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R2001-0038 03-26-01 RESOLUTION NO. R2001-38 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS, ACCEPTING THE RESULTS OF THE CITY'S ANNUAL FINANCIAL AUDIT AS PREPARED BY NULL-LAIRSON, P.C. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS: Section 1. That certain financial audit as prepared by NulI-Lairson, P.C., 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 results of the City's annual financial audit. PASSED, APPROVED and ADOPTED this the 26 day of March A.D., 2001. TOM REID MAYOR ATTEST: UNG L~NG/ APPROVED AS TO FORM: DARRIN M. COKER CITY ATTORNEY CITY OF PEARLAND,TEXAS FEDERAL SINGLE AUDIT REPORT YEAR ENDED SEPTEMBER 30, 2000 Null - Lairson Professional Corporation Certified Public Accountants 11 Greenway Plaza,Suite 1515 Houston,Texas 77046 (713)621-1515 CITY OF PEARLAND,TEXAS FEDERAL SINGLE AUDIT REPORT YEAR ENDED SEPTEMBER 30,2000 TABLE OF CONTENTS Page Independent Auditors' Report on Compliance and on Internal Control Over Financial Reporting Based on an Audit of the General Purpose Financial Statements Performed In Accordance With Government Auditing Standards 1-2 Independent Auditors' Report on Compliance With the Requirements Applicable to Each Major Program,Internal Control Over Compliance in Accordance with OMB Circular A-133, and on the Schedule of Expenditures of Federal Awards 3-4 Schedule of Expenditures of Federal Awards 5-6 Note on Accounting Policies for Federal Awards 7 Schedule of Findings and Questioned Costs 8 Status of Prior Findings 9 Corrective Action Plan 10 11 Greenway Plaza,Suite 1515 Null A Lairson One Sugar Creek Center Blvd.,Suite 920 Houston,TX 77046 Sugar Land,TX 77478 (713)621-1515 Fax:(713)621-1570 CERTIFIED PUBLIC ACCOUNTANTS (281)242-8600 Faxc(281)242-7333 PROFESSIONAL CORPORATION Independent Auditors' Report on Compliance and on Internal Control Over Financial Reporting Based on an Audit of the General Purpose 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 the general purpose financial statements of the City of Pearland, Texas ("City"), as of and for the year ended September 30, 2000, and have issued our report thereon dated January 11, 2001 We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Compliance As part of obtaining reasonable assurance about whether the City's general purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws,regulations, contracts, and grants,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, accordmgly,we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. Internal Control Over Financial Reporting In planning and performing our audit, we considered the City's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control over financial reporting that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses. 1 To the Honorable Mayor and Members of City Council City of Pearland, Texas Page 2 This report is intended solely for your information and use and the information and use of management, federal awarding agencies, and pass-through entities and is not intended to be, and should not be, used by anyone other than those specified parties. 740 oYQ , ram.-. e . Houston, Texas January 11, 2001 2 IlL 11 Greenway Plaza,Suite 1515 Null A L..ai rson One Sugar Creek Center Blvd.,Suite 920 Houston,TX 77046 Sugar Land,TX 77478 (713)621-1515 Fax:(713)621-1570 CERTIFIED PUBLIC ACCOUNTANTS (281)242-8600 Fax:(281)242-7333 PROFESSIONAL CORPORATION Independent Auditors' Report on Compliance With the Requirements Applicable to Each Major Program,Internal Control Over Compliance in Accordance with OMB Circular A-133, and on the Schedule of Expenditures of Federal Awards To the Honorable Mayor and Members of City Council City of Pearland, Texas Compliance We have audited the compliance of the City of Pearland ("City") with the types of compliance requirements described in the U S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to each of its major federal programs for the year ended September 30, 2000. The City's major federal programs are identified m the summary of auditors' results section of the accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, regulations, contracts, and grants applicable to each of its major federal programs is the responsibility of the City's management. Our responsibility is to express an opinion on the City's compliance based on our audit. We conducted our audit of compliance m accordance with generally accepted auditmg standards, the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133 Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and matenal effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the City's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on the City's compliance with those requirements. In our opinion, the City of Pearland, Texas, complied, m all material respects, with requirements referred to above that are applicable to each of its major federal programs for the year ended September 30, 2000 3 To the Honorable Mayor and Members of City Council City of Pearland, Texas Page 2 Internal Control Over Compliance The City's management, is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts, and grants applicable to federal programs. In planning and performing our audit, we considered the City's internal control over compliance with requirements that could have a direct and material effect on a major federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133 Our consideration of the internal control over compliance would not necessarily disclose all matters in the mternal control that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that noncompliance with applicable requirements of laws, regulations, contracts, and grants that would be material in relation to a major federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses. Schedule of Expenditures of Federal Awards We have audited the City's general purpose financial statements as of and for the year ended September 30, 2000, and have issued our report thereon dated January 11, 2001 Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by OMB Circular A-133 and is not a required part of the general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the general purpose financial statements taken as a whole. This report is intended solely for your information and use and the information and use of management, federal awarding agencies, and pass-through entities and is not intended to be, and should not be, used by anyone other than those specified parties. -7/j. g •••••-• 4 Houston,Texas January 19,2001 (except for the sixth paragraph of this report as to which the date is January 11, 2001) 4 (This page intentionally left blank.) CITY OF PEARLAND,TEXAS SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR YEAR ENDED SEPTEMBER 30,2000 Federal Grantor/Pass-through Federal Grant/Program Title CFDA Number FEDERAL AWARDS US DEPARTMENT OF COMMERCE,. ECONOMIC DEVELOPMENT ASSISTANCE Grants for Public Works and Economic Development 11.300 US DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT Passed through Harris County Community Development: Community Development Block Grants/Entitlement Grants (Morenci Road) 14.218 US DEPARTMENT OF JUSTICE Local Law Enforcement Block Grants Program 16.592 Bulletproof Vest Partnership Program 16.607 Public Safety Partnership and Community Policing Grants 16.710 Passed through Texas Governor's Office-Criminal Justice Division: Enforcing Underage Drinking Laws Program 16.727 ENVIRONMENTAL PROTECTION AGENCY Passed through Texas Water Development Board: Capitalization Grants for State Revolving Funds 66.458 FEDERAL EMERGENCY MANAGEMENT ASSISTANCE Passed through Texas Department of Public Safety: Emergency Management Performance Grants 83.552 TOTAL FEDERAL AWARDS 5 Pass-through/Grantor's Program or Disbursement/ Contract Number Award Amount Expenditures 08-01-03185 $ 1,500,000 $ 522,940 CD 94-062 253,137 3,673 98-LB-VX-4864 17,302 17,302 99004040 4,826 4,826 95CFWX307 900,000 149,180 AH-98401-1-13219 63,000 35,855 985,128 207,163 3393-02 17,100,000 3,588,516 EMT-2000-GR-0020 18,138 17,531 $ 19,856,403 $ 4,339,823 6 (This page intentionally left blank.) CITY OF PEARLAND,TEXAS NOTE ON ACCOUNTING POLICIES FOR FEDERAL AWARDS YEAR ENDED SEPTEMBER 30,2000 NOTE -BASIS OF ACCOUNTING The City accounts for all awards under federal programs in special revenue and enterprise funds. Special revenue fund programs are accounted for usmg 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)m net current assets. The modified accrual basis of accounting is used for these programs. This basis of accounting recognizes revenues in the accounting period m 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. Federal grant funds for special revenue fund programs 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 deferred revenues until earned. Generally, unused balances are returned to the grantor at the close of specified project periods. Enterpnse fund programs are accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and liabilities associated with the operation of the programs are included on the balance sheet. Operating statements present increases and(revenues) and decreases (expenses)in net total assets. The full accrual basis of accounting is used for these programs. This basis of accounting recognizes revenues when earned and expenses when incurred. The enterprise fund programs follow generally accepted accountmg principles prescribed by the Governmental Accounting Standards Board and Financial Accounting Standards Board standards issued prior to November 30,1989 Subsequent to this date, these programs are accounted for as prescribed by the Governmental Accounting Standards Board. 7 CITY OF PEARLAND,TEXAS SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED SEPTEMBER 30,2000 SUMMARY OF AUDITORS' RESULTS SECTION LEVEL DESCRIPTION FINANCIAL STATEMENTS Type of auditors' report issued on financial statements. Unqualified. Findings related to compliance with laws and regulations. None. Reportable conditions noted in relation to internal control over financial reporting. None Material weaknesses noted in relation to internal control over financial reporting. None. FEDERAL AWARDS Type of report on compliance with major programs. Unqualified. Findings and questioned costs for federal awards as defined in section .510(a)OMB Circular A- There were no known questioned costs above 133 $10,000. Reportable conditions reported in relation internal controls over compliance with requirements applicable to each major program. None reported. Material weaknesses noted m relation internal controls over compliance with requirements applicable to each major program. None. Dollar threshold considered between type A and type B federal programs. $300,000. Low nsk auditee statements. The City was not classified as a low-nsk auditee in the context of OMB Circular A-133 Major Federal Programs. 1 Capitalization Grants for State Revolving Funds(CFDA#66.458) 2. Grants for Public Works and Economic Development(CFDA#11.300) Pass-through Entity 1 Texas Water Development Board(Project #3393-02). 2. Direct federal 8 CITY OF PEARLAND,TEXAS STATUS OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED SEPTEMBER 30, 1999 PROGRAM STATUS OF PRIOR YEAR'S FINDING Compliance Findings—Financial Statements Compliance Finding#99-1 Delinquent Tax The City now allocates delinquent tax receipts Receipts Regarding the Debt Service Fund regarding the debt service fund Reportable Conditions—Financial Statements Reportable Condition#99-2 Motor Fleet The City has an inventory tracking procedure and Gasoline Inventories in place for motor fleet and gasoline inventories. Reportable Condition#99-3 Grant Accounting and Maintenance of Separate The City has established a separate fund to Funds account and maintain grant funds Material Weaknesses—Financial Statements Material Weakness#99-4 Accounting for The P.E.D C. is now accounted for as a P.E.D.C. Capital Expenditures governmental fund. All capital expenditures are accounted for m the City's General Fixed Asset Account Group. Material Weakness#99-5 Physical The City obtained a good physical count of Inventory of Equipment, Other Fixed fixed assets on hand. The City's fixed asset Assets,& Capitalization Level capitalization policy was increased to $5,000 Compliance Findings—Federal None Noted. Internal Control—Federal None Reported. 9 CITY OF PEARLAND, TEXAS CORRECTIVE ACTION PLAN FOR THE YEAR ENDED SEPTEMBER 30,2000 For All Items: Contact Person. Mr Jim Causey—Director of Finance-Phone No. (281)652-1672. Estimated Completion Date: During the 1999-2000 fiscal year CORRECTIVE ACTION PLAN NOT APPLICABLE 10 1 Exhibit "A" i ' Resolution No. R2001-38 I. / 4 , Y , Y ,, ) Li' , _— l ) 1- , r I 1, 1, 6I \sllkj _ ` TI" 11, _ , , Yy v c Y.„..., r +ter` ;r > �... ,, .. _, „, !. J.,, ,,, 1 tl �' 'I" f, , ,1 it , , , 1?, to It _ ., . , , , .. . . d „ 0 M. lh :_ . . . . , ,. . . a z 1 cy. a rl 1 r, , 1 .1,r I �. '!s, /, ..., 1 ,,, , ,. ' '1, ., , :, ,, , ., .,. .,_ , , , , , , „,,,,t a „I , �, i , ... _., • ., ., „ ,,t . , , .„ ,, 4, pic.A---, ,, , , ., ,. , , , ., , , w« r,, 0‘ .. _____..... -ih.\\, ,, .. .1 eee \ v 1 J �5� r wwrlwwr �I E ' 1 , p . ' \—,' --- e L iE/ -- , i ., 1 ,. /. ..\__N .10 1.1 . _ 1 1 .S \ � a9 _ , r x / ' I FOR.THE, YEAR EN DE.aS;.EPTE:M�BER' 3�0,. 2.0007 El s ,„1.., a e__ e_,s r s Ie �•. a t_ 1 , ,-,CITY OF PEARLAND, TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT Year Ended September 30,2000 , , , e Prepared By. Finance Department CITY OF PEARLAND, TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT TABLE OF CONTENTS Year Ended September 30,2000 Exhibit Page INTRODUCTORY SECTION Letter of Transmittal 1 GFOA Certificate of Achievement for Excellence in Financial Reporting 7 Organization Chart 8 Principal Officials 9 Executive Managers 10 FINANCIAL SECTION Independent Auditors' Report 13 GENERAL PURPOSE FINANCIAL STATEMENTS Combined Balance Sheet-All Fund Types,Account Groups, and Discretely Presented Component Unit 1 16 Combined Statement of Revenues, Expenditures,and Changes in Fund Balances -All Governmental Fund Types and Discretely Presented Component Units 2 18 Combined Statement of Revenues, Expenditures,and Changes in Fund Balances -Budget and Actual-General and Debt Service Funds 3 20 Combined Statements of Revenues, Expenses, and Changes.in Retained Earnings—All Proprietary Fund Types 4 22 Combined Statements of Cash Flows—All Proprietary Fund Type 5 23 Notes to Financial Statements 24 REQUIRED SUPPLEMENTARY INFORMATION Pension.Information—Texas Municipal Retirement System 46 COMBINING AND INDIVIDUAL FUND AND ACCOUNT GROUP FINANCIAL STATEMENTS AND SCHEDULES Governmental Fund Types General Fund. Comparative Balance Sheet A-1 52. Statement of Revenues, Expenditures,and Changes in Fund Balance-Budget and Actual A-2 53 Schedule of Revenues-Budget and Actual A-3 54 Schedule of Expenditures-Budget and Actual A-4 57 CITY OF PEARLAND, TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT TABLE'OF CONTENTS Year Ended.S eptember 30,2000 Exhibit _ ,Page . , FINANCIAL SECTION(continued) COMBINING AND INDIVIDUAL FUND AND ACCOUNT GROUP FINANCIAL STATEMENTS AND SCHEDULES (continued) Governmental Fund Types(continued) Special Revenue Funds: - Combining:Balance Sheet B-1 64 Combining Statement-of Revenues, Expenditures,and Changes in Fund Balances B-2 66 Debt Service Fund: Comparative Balance Sheet C-I 70 Statement of Revenues,Expenditures,and Changes in Fund Balance-Budget and Actual C-2 71 Capital Projects Funds. Combimng.Balance Sheet D-1 74 Combining Statement of Revenues,Expenditures,and Changes in Fund Balance D-2 76 Account Groups- General Fixed Assets: Sehedule of General Fixed Assets by Source E-1 82 k Schedule of Changes in General Fixed Assets by Function and Activity E-2 83 Schedule of General Fixed Assets by Function and Activity E-3 84 General Long-Term Debt: Schedule of General Long-Term Debt Service Requirements to Maturity F 88 Enterprise'Fund,Debt- Schedule of Enterprise Fund, Debt Service Requirements to Maturity G 92 Component Units Combining Balance Sheet,Component Units H-1 94 Combining Statement of Revenues, Expenditures, and Changes in.Fund Balance Component Units H-2 95 Combining Balance Sheet Pearland Economic Development Corporation(P.E.D C.) I-1 96 ii CITY OF PEARLAND, TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT TABLE;OF CONTENTS Year Ended September 30,2000 Exhibit Page, FINANCIAL SECTION(continued) COMBINING AND INDIVIDUAL FUND AND ACCOUNT GROUP ,FINANCIAL"STATEMENTS AND'SCHEDULES (continued) Component Units(continued) Combining Statement of Revenues,Expenditures,and Changes in Fund Balance Pearland Economic Development Corporation(P.E.D C) I-2 97 Combining Balance Sheet TIRZ.#1&#2 J-1 98 , Combining Statement of Revenues,,Expenditures,and Changes in Fund Balance TIRZ#18&#2. J-2 99 Table Page' UNAUDITED STATISTICAL.SECTION 'General Governmental Expenditure's by Function.—Last Ten Fiscal Years 1 102 General Governmental-Revenues by Source—.Last Ten Fiscal Years 2 104 Property Tax Levies and Collections-.Last Ten Fiscal Years 3 106 Assessed Value of Taxable Property-Last Ten Fiscal Years 4- 108 Property Tax Rates-Direct and Overlapping Governments, -Last Ten Fiscal Years ' 5 '109 Principal Taxpayers 6, 110 Property Value, Construction,and Bank Deposits 7 , 1111 Ratio of Net General Long-Term Debt to Assessed Value and Net Long-Term Debt PerCapita.-Last Ten,Fiscal Years '8 112 Ratio of Annual Debt Service Expenditures for General Long-Term Debt 'to Total General Governmental Expenditures,-Last Ten Fiscal Years 9 114 Computation of Direct and Overlapping Debt .10 115 Demographic Statistics 11 116 Miscellaneous'Statistical Data 12 117 i v 111 O�Y SEC. ;p1� I1`��O��C� Co44*,,e( i.Wirillirpl9VWW” EAQ1 L -u4.1-t ------4 T E X AS rt s 9 To the Honorable Mayor,Members of City Council, and Citizens of the City of Pearland Pearland,Texas. The comprehensive annual financial report of the City of Pearland, Texas (the "City") for the fiscal year ended September 30, 2000, is hereby submitted. Responsibility for both the accuracy of the data, and the completeness and fairness of the presentation, including all disclosures, rests with the City To the best of our knowledge and belief, the enclosed data are accurate in all material respects and are reported in a manner designed to present fairly the financial position and results of operations of the various funds and account groups of the City All disclosures necessary to enable the reader to gain an understanding of the City's financial activities have been included. The comprehensive annual financial report is presented in three sections. Introductory, Financial, and Statistical Section. The Introductory Section includes this transmittal letter, the City's organizational chart, and a list of principal officials. The Financial Section includes the general purpose financial statements and the combining and individual fund and account group financial statements and schedules, as well as the auditor's report on the financial statements and schedules. The Statistical Section includes selected financial and demographic information,generally presented on a multi-year basis. The financial reporting entity (the "City") includes all the funds and account groups of the primary government (i.e., the City of Pearland as legally defined), as well as all of its Component Units. Component Units are legally separate entities for which the primary government is financially accountable. The City provides the full range of municipal services contemplated by statute or charter This includes police and fire protection, health and social services, public improvements, planning and zoning, and general administrative services. The City also provides water, sewer, and sanitation services. Additionally, the City has an Economic Development Corporation, designed to attract and retain jobs and more fully develop the local ad valorem tax base. Discretely presented and blended component units are reported in a separate column in the combined financial statements to emphasize that they are legally separate from the primary government and to differentiate their financial position, results of operations, and cash flows from those of the primary government. The Economic Development Corporation is reported as a discretely presented component unit. 3519 LIBERTY DRIVE•PEARLAND,TEXAS 77581 •281-652-1600•www.ci.pearland.tx.us Printed on Recacled Paper 0 ECONOMIC CONDITION AND OUTLOOK The City of Pearland lies fifteen miles southeast of downtown Houston and ten miles from the Texas Medical Center in the northeast corner of Brazoria County, with small areas within Harris and Fort Bend Counties. Pearland is accessible by way of four major highways and is six miles from Houston Hobby Airport. Sales tax receipts have shown favorable increases for the last several years. Permits for more than 700 single-family residences were issued in 2000 The Pearland Economic Development Corporation (PEDC) awarded incentive packages to either attract new businesses or allow existing businesses to expand. MAJOR INITIATIVES The Pearland City Council sets its goals each year in a strategic planning workshop Some of the highlighted goals include: • Enhance the transportation network to improve the efficiency of traffic movements. • Update land use and development standards and practices to reflect the goals of the Comprehensive Plan. • Create recreational opportunities to meet the needs of the citizens. • Maintain and enhance Pearland's high standards of public safety • Reduce the frequency and severity of flooding through a comprehensive storm water management policy • Ensure adequate water supply and wastewater treatment capacity for growth. • Ensure the City is financially sound and fiscally responsible. 2 FUTURE OUTLOOK Brazoria County's current population is just under 228,000 It is estimated that this will increase to over 330,000 in the next ten to fifteen years. According to the Brazoria County Partnership,job growth will be focused in four primary areas 1)aerospace/high technology, 2) transportation and distribution, 3) petrochemical and downstream petrochemical companies, and 4)tourism. In late 1998, the City of Pearland created a Tax Increment Reinvestment Zone (TIRZ#2). This involved the annexation of over 3,000 acres west of the State Highway 288 (SH 288) corridor The city limit now extends to portions of Fort Bend County The proposed development, Shadow Creek Ranch, has the potential to develop the acreage over a fifteen to twenty year time frame. It is estimated that 7,000 new single-family homes, 1,800 assisted living units, and 3,900 multi-family units could be developed. More than two billion dollars worth of value would be added over the next twenty years. Shadow Creek Ranch will not only improve roads in the area, but will also bring in sewer and drainage, water, and major landscaping to the area. The added population poises SH 288 for major retail and- commercial development that could eventually include major office buildings, a hospital, and hotels. DEPARTMENT FOCUS Finance: The Finance Department continues to improve in multiple major areas. Additional staff has allowed for enhanced interest earnings and improved financial projections. The department continues to submit winning GFOA awards for budget presentation and financial audit reporting. Purchasing procedures have allowed the city to streamline and-centralize its purchasing function. FINANCIAL INFORMATION Management of the City is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft or misuse, and to ensure that adequate accounting data are compiled to allow for the preparation of financial statements in conformity with generally accepted accounting pnnciples. The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that (1) the cost of controls should not exceed the benefits expected to be denved and (2) the evaluation of costs and benefits requires estimates and judgments by management. Accounting Controls. We believe that the City's accounting controls provide reasonable assurance that errors or irregularities that could be material to the financial statements are prevented or would be detected within a timely period by employees in the normal course of performing their assigned function. Budgeting Controls. In addition, the City maintains budgetary controls. The objective of these budgetary controls is to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the City's governing body Activities of the General, Debt Service, and Enterprise Funds are included in the annual appropriated budget. The level of budgetary control (the level at which expenditures cannot legally exceed the appropriated amount) is the total approved budget for each department. 3 As demonstrated by the statements and schedules included in the financial section of this report, the City continues to meet its responsibility for sound financial-management. General Government Functions. The revenue from the general, special revenue, and debt service funds, and the amount and percentage of increases and decreases in relation to prior year revenue,is summarized in the following schedule: 2000 Percent of 2000 Percent of 1999 'Increase Increase Revenue Source Amount Total Amount (Decrease) (Decrease) Property taxes and penalities $ 9,344,578 42.6 % $ 8,192,927 $ 1,151,651 14 do % Sales taxes 3 745 460 17 1 3,426,576 318,884 9.3 Franchise and gross receipts ta) 2,022,789 9.2 1,943,545 79,244 4 1 Licenses and permits 1,469,799 6 7 955,819 513,980 53 8 Fines and Forfeitures 731,959 3.3 675,691 56,268 8.3 Intergovernmental 15,000 0 1 489,860 (474,860) (96 9) Charges for services 3,061,545 14.0 2,960,214 101,331 3 4 Interest 529,861 2.4 335,544 194,317 57 9 Other 990,634 , 4.5 356,937 633,697 177.5 $ 21,911,625 100 0 % $ 19,337,113 $ 2,574,512 The most significant percentage increase in revenue was derived from Licenses and Permits. This was due primarily to the continued growth of the city and related building permits. The percentage changes. between the "interest"and"other"line items offset each other Allocations of property tax levy by purpose for 1999-2000 fiscal year and the preceding two fiscal years are as follows (amount per$100/assessed value). Purpose 1999-00 1998-99 1997-98 General Fund $ 0 440 $ 0 440 $ 0 440 General Obligation Debt 0.255 0.255 0-255 Total Tax Rate $ 0 695 $ 0 695 $ 0 695 4 The expenditures for the general, special revenue, and debt service funds and the amount, and percentage of increases and decreases in relation to the prior year expenditures, are summarized in the following schedule. 2000 Increase Percent of 2000 Percent of 1999 (Decrease) Increase Function Amount Total Amount . Over 1999-00 (Decrease) . General Government $ 3,971,691 19 1 % $' 3,690,296 $ 281,395 7.6 % Public Safety 5 952,191 28.6 5,698,238 253,953 4.5 Public Works 5,635,397 27 1 5 137,708 497,689 9 7 Community Services 1,781,610 8 6 1,598,521 183,089 11.5 Debt Service 3,436,061 16.5 3,582,811 (146,750) (4 1) $ 20,776,950 100.0 ,% $ 19,707,574 $) 1,069,376 Enterpnse Operations. The government's enterpnse operations are comprised of the Water and Sewer System. Water and Sewer System. Operating revenues totaled $9,228,160 compared to $5,850,554 last year, a 8.8% increase. The increase is due to increase in growth, annexations, and increased water and sewer rates. Comparative data for the past two.fiscal years are presented in the following schedule: 1999-00 1998-99 Operating Revenues $ 7,146,031 $ 5,850,554 Operating expenses (before depreciation) 3,899,289 3,464,094 Operating income (before depreciation) $ 3,246,742 $ 2,386,460 Number of customers (water) 11,000 10,452 Debt Administration. The ratio of net debt to assessed valuation and the amount of bonded debt per capita are useful indicators of the-City's debt position'to municipal management, citizens, and investors. These data for the City of Pearland at September 30, 2000, were as follows: The City's assigned "insured"bond ratings on its most recent issue were as,follows_ Standard& Moody's Poors Revenue Bonds Aaa AAA Tax Bonds Aaa AAA Cash Management. Cash, temporarily idle during the year, was invested in certificates of deposit ranging from 60 to 365 days to maturity Certificate of deposit and cash amounts which exceed FDIC coverage are collateralized by secunties owned by the City's depository All investments held by the City dunng the year and. at September 30, 2000, are classified in the category of lowest credit risk as defined by the Governmental Accounting Standards Board. Risk Management. Dunng 1999-2000, the City continued an aggressive risk management program for worker's compensation. Various risk control techniques, including employee accident prevention training, have been emphasized dunng the year in order to minimize accident-related losses. 5 OTHER INFORMATION Independent Audit. The City Charter requires an annual-audit of the books of account, financial records, and transactions of all administrative departments of the City by an independent certified public accountant. The accounting firm of Null - Lairson, P C. was selected by the City Council. This requirement has been complied with, and the auditors' opinion has been included in this report. Awards The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Pearland for its Comprehensive Annual Financial Report for the fiscal year ended September 30, 1999 This was the twenty third consecutive year that the City has received this prestigious award. In order to be awarded a Certificate of Achievement, a governmental unit must publish an easily readable and efficiently organized comprehensive annual financial report, whose contents conform to program standards. Such reports must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a penod of one year only We believe our current report continues to conform to Certificate of Achievement Program requirements and we are submitting it to GFOA to determine its eligibility for another certificate. In addition, the government also received the GFOA's Award for Distinguished Budget Presentation, the thirteenth consecutive year for its annual appropriated budget dated September 13, 1999 In order to qualify for the Distinguished Budget Presentation Award, the government's budget document was judged to be proficient in several categories including policy documentation,financial planning, and organization. Acknowledgments. We would like to express our appreciation to all members of the Finance and Administration Department who assisted and contributed to its preparation. We would also like to thank the Mayor, members of the City Council, and City Manager for their interest and support in planning and conducting the financial operations of the City in a responsible and progressive manner Respectfully submitted, Jimmy Causey Director of Finance January 11,2001 6 Certificate of Achievement for Excellence in Financial Reporting Presented to City of Pearland, Texas For its'Comprehensive Annual Financial Report for the Fiscal Year Ended September 30, 1999 A.Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada'to government units and public employee retirement systems whose comprehensive annual financial reports(CAFRs) achieve the highest standards in government accounting and financial reporting. 80 IwoC4 President yA0 zg Executive Director 7 CITIZENS CITY COUNCIL MUNICIPAL JUDGES CITY MANAGER f --il CITY ATTORNEY ECONOMIC DEPUTY CITY MANAGER OF CITY SECRETARY DEVELOPMENT MANAGER ADMINISTRATIVE SUPPORT FINANCE ENGINEERING _ ADMINISTRATIVE SER VICE ACCOUNTING - I PROJECTS I PURCHASING HUMAN RESOURCES PUBLIC WORKS UTILITY BILLING FLEET MUNICIPAL- M.I.S. MAINTENANCE COURT STREETS AND FIRE MARSHAL/ DRAINAGE - EMERGENCY MANAGEMENT FIRE WATER COMMUNITY PRODUCTION AND DEVELOPMENT WASTEWATER EMS TREATMENT ANIMAL CONTROL WATER AND PARKS&RECREATION - WASTEWATER DISTRIBUTION BUILDING AND COLLECTION INSPECTION RECREATION CODE WATER AND ENFORCEMENT PARKS/BUILDING WASTEWATER MAINTENANCE CONSTRUCTION COMMUNITIY PLANNING AND CENTER ZONING KNAPP BUILDING GRANTS/PUBLIC AFFAIRS CUSTODIAL POLICE CID CIVILIAN COMMUNITY SERVICE PATROL 8 CITY OF PEARLAND, TEXAS Page 1 of 2 List of Principal Officials As of September 30,2000 ' Elected Officials Tom Reid Mayor Klaus Seeger (Position 5) Mayor Pro Tern Helen Beckman (Position 1) Council.Member Woody Owens (Position 2) Council Member Larry Wilkins (Position 3) Council Member Larry Marcott (Position 4) Council Member Appointed Officials Alan Mueller Interim City Manager Young Lorfing City Secretary Damn Coker City Attorney 9 CITY OF PEARLAND, TEXAS Page 2 of-2 List of Principal Officials As of September.30,2000 Executive Managers Mike Chance Executive Director of P.ED C. Jimmy Causey Director of Finance ChriS Doyle Police Chief Larry Steed Fire Marshal/Emergency , Management Director Tobin Maples Manager of Administrative Serv= Ed Hersh Director of Parks &Recreation Glenn Chaney' Municipal Court Judge Roy Simmons Municipal Court Judge Edward Sillas Municipal Court Judge Floyd Myers. Municipal Court Judge i r 10 C1AL SECO-01 11 (this page intentionally left blank) 12 /RA 11 Greenway Plaza,Suite 1515 Null•Lairson One Sugar Creek Blvd.,Suite 920 Houston,TX 77046 Sugar Land,TX 77478 (713)621-1515 CFRTIFIFDPUBUCACCOUNTANTS (281)242-8600 Fax: (713)621-1570 PROFESSIONAL CORPORATION Fax. (281)242-7333 Independent Auditors' Report To the Honorable Mayor and Members of the City Council City of Pearland,Texas We have audited the accompanying general purpose financial statements of the City of Pearland, Texas, as of and for the year ended September 30, 2000, as listed in the table of contents. These general purpose financial statements are the responsibility of the City's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose- financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall general purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Pearland, Texas, as of September 30, 2000, and the results of its operations and the cash flows of its proprietary fund type for the year then ended in conformity with generally accepted accounting principles. Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The combining and individual fund and account group financial statements and schedules listed in the table of contents are presented for purposes of additional analysis and are not a required part of the City's general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. The Required Pension System supplementary Information listed in the table of contents is not a required part of the general-purpose financial statements but is supplementary information required by the Government Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the additional information. However, we did not audit the information and express no opinion on it. Houston,Texas C January 11, 2000 13 NTS T ATE � OSE FINANCIAL S CE�',�p'I,PURPOSE 15 CITY OF PF.ARLAND,TEXAS COMBINED BALANCE SHEET-ALL FUND TYPES, ACCOUNT GROUPS AND DISCRETELY PRESENTED COMPONENT UN1TS 1 September 30,2000 with comparative totals for September 30,1999 Proprietary Governmental Fund Types Fund Type Special Debt Capital Enterprise General Revenue Service Projects Fund Assets and Other Debits Assets Cash and cash equivalents $ 6,503,460 $ 558,997 $ 736,014 $ 5,049,607 $ 27,800,968 Receivables: Property taxes 319,546 - 159,624 - - Accounts Receivable 443,563 - - - 1,171,151 Less:Allowance for estimated uncollectibles (63,008) - - - (84,603) Assessments - - - 242,178 - Accrued interest 31,943 88 - '3,826 142,751 Due from other funds 63,008 50,569 560,464 Inventories 51,678 - - - - Restricted assets-Cash and cash equivalents - - - - 425,136 Deferred charges - - - - 503,652 Fixed assets(net where applicable of accumulated depreciation) - - - - 28,8.80,315 Other Debits Amount available for debt.service - - - - - Amount to be provided for retirement of general long-term debt - - - - - Total Assets and Other Debits $ 7,350,190 $ 609,654 $ 895,638 $ 5,295,611 , $ 59,399,834 Liabilities,Equity,and Other Credits Liabilities Accounts payable $ 797,699 $ 5,173 $ 13,489 $ 149,970 $ 1,559,251 Accrued liabilities 253,535 - - - 90,700 Due to other funds 610,015 1,019 - - 63,008 Security deposits - - - - 528,630 Accrued compensated absences 164,186 - - - 171,675 Deferred revenue 319,546 - 159,623 31,566 - Current portion-revenue bonds - - - 585,000 Certificates of obligation - - - - - Revenue bonds-less current portion - - - - 33,140,000 Obligations under capital leases - - - - - General obligation bonds - - - - - Total Liabilities 2,144,981 6,192 173,112 181,536 36,138,264 Equity and Other Credits Contributed capital - - - - 18,054,250 Investment in general fixed assets - - - - Retained earnings - - - - - 5,207,320 Fund Balances: Reserved for encumbrances 294,544 - - 2,260,550 - Unreserved: Designated for debt service - - 722,526 - - Designated for subsequent years'expenditures - 603,462 - 2,853,525 - Undesignated 4,910,665 - - - - Total Equity and Other Credits 5,205,209 603,462 722,526 5,114,075 23,261,570 Total Liabilities,Equ ity,•and Other Credits $ 7,350,190 $ 609,654 $ 895,638 $ 5,295,611 $ 59,399,834 See Notes to Financial Stateiitnts. 16 , , <• Exhibit 1 ' Totals ' -Piiniary Discretely Account Groups Government Presented Totals Reporting Entity General General long- (Memorandum Component (Memorandum Only). Fixed Assets Term Debt Only). Units Sept 30,2000 Sept.30,1999 $ - $ - $ 40,649,046 $, .3,543,017 $• 44,192,063 $ 39,179,047 - •- 1 479,170 - 479,170 389,445 - - 1,614,714 - 1,614,714 1,252,610. ' - (147,611) - (147,611) (116,754) - - 242,178 - 242,178 15,966 - 178,608 16,488 195,096 , 139,669 674,041 - 674,04t - - 51;678 - 51,678 60,000 - - 425,136 - 425,136 413,149 - - - 503,652 - 503,652 541,290 _0,334,277 - 78,214,592 '•55,403 78,269;995. 64,963;456` - ' 722,526 722,526, - 722,526 208;324 , - 30,134;253 . .30,134,253 •4,752,620 , 34,886;873• 39,188,615 , 49;334,277 . 30,856,779 153,741;983 8,367,528 162,109,511 146,234,817 $ - $ - $ 2,525,582 $ 34,727 $ 2,560,309 $. 2,348,910 - - 344,235 - 344,235 378,762 - - 674,042 - 674,942 - - - 528,630 _ - 528,630 , 416,988 - 1,215,529 "1,551,390 7,620 1,559,010 .1;501,502 , - 510,735 '- 510,735 405,411 585,000 95,000 680,000 510,000 - ' 15,875,000 15,875,000 - 15,875;000 17,525,000 - 33,140,000- - 33,140,000 '25,725,000 - , 381,250. '381,250 - 381,250 888,569 - 13,385;000 '13,385,000 4,650,000 18,035;000 . 19;850,000 - 30,856,779 �, 69,500,864 4,787,347 74,288;211 ' , 69,550;142 , 18,054,250 18,054,250 16,021,808 49;334,277 49;334,277 55,403` 49,389,680 44,534,133 5,207,320 - 5,207,320 , 3,337,913 - - 2,555,094 - 2,555,094 816;874 - - 722;526 - 722,526 208,324 - - 3,456,987 - 3,456,987 4,667,445 -, - . _ 4,910,665 , 3,524,778 8,435,443 _, 7,098,178 49,334;277 , ' - ' 84,241,119 3,580,181 .87,821,300 ., 76,684,675 ., $ -49,334,27.7 $ .30,856,779 .$ 153,741,983 $ 8,367;528 $ 162,109,511 $ 146,234,817 , 17 CITY OF PEARLAND,TEXAS COMBINED'STATEMENT OF REVENUES,EXPENDITURES,AND CHANGES IN.FUND BALANCES -ALL GOVERNMENTAL FUND TYPES,.AND DISCRETELY PRESENTED COMPONENT UNITS Year Ended September 30,2000 with comparative totals for Year Ended September 30, 1999 Governmental Fund Special Debt ,General Revenue .Service Revenues Property taxes and penalties $ 5,876,495 $ - $ 3,468,083 Other taxes 3,697,523 47,937 - Licenses and permits 1,469,799 - - Fines and forfeitures 731,959 - - Franchise fees 2,022,789 - - Charges for services 3,061,545 - - Intergovernmental revenues 15,000 - - Other revenues 827,950 582,388 110,157_ Total Revenues 17,703,060 630,325 3,578,240 Expenditures Current: General government 3,580,693 390,998 - Public safety 5,944,516 7,675 - Public works 5,635,397, - - Community services 1,762,770 18,840 - Economic Development - - - Capital'Outlay - - Debt Service. Principal retirement - - 1,605,000 Interest and fiscal charges - - 1,459,038 Total Expenditures 16,923,376 417,513 3,064,038 Revenues.Over(Under)Expenditures 779,684 212,812 514,202 Other Financing Sources(Uses), Operating transfers in 781,000 100,000 - Operating transfers(out) (922,967) - - Operating transfers in from component unit(P.E.D C ) 110,000 - - Operating transfers out from primary government - - - Proceeds from lease financing - - - Total Other Financing Sources(Uses) (31,967) 100,000 - Revenues and Other Financing Sources Over(Under) Expenditures and Other Financing(Uses) 747,717 312,812 514,202 Fund Balances-Beginning 4,457,492 290,650 208,324 Fund Balances-Ending $ 5,205,209 $ 603,462 $ 722,526 See Notes to Financial Statements: 18 Exhibit 2 Totals Discretely Types (Memorandum Only) Presented Totals Reporting Entity Capital Primary Component (Memorandum Only) Projects Government ‘ Units 2000 1999 $ - $ 9,344,578 $ - $ 9,344,578 $ 8,192,927 - 3,745,460 1,841,918 5,587,378. 5,191,647 - 1,469,799 - 1,469,799 955,819 - 731,959 - 731,959 675,691 - 2,022,789 - 2,022,789 1,943,545 - 3,061,545 - 3,061,545 2,960,214 15,000 - 15,000 489,860 908,844 2,429,339 600,465 3,029,804 1,663,726 908,844 22,820,469 2,442,383 25,262,852 22,073,429 - 3,971,691 - 3,971,691 3,690,296 - 5,952,191 - 5,952,191 5,698,238 - 5,635,397 - 5,635,397 5,137,708 - 1,781,610 - 1,781,610 1,598,521 - - 531,969 531,969 455,517 1,679,600 1,679,600 701,280 2,380,880 6,989,770. - 1,605,000 90,000 1,695,000 1,525,000 - 1,459,038 282,023 1,741,061 2,057,81.1 1,679,600 22,084,527 1,605,272 23,689,799 27,152,861 (770,756) 735,942 8,37,111 1,573,053 (5,079,432) 694,967 1,575,967 - 1,575,967 1,258,000 (922,967) - (922,967) (464,384) - 110,000 - 110,000 110,000 - - (11,0,000) (110,000) (110,000)_ 151,676 151,676 - . 151,676 425,000 846,643 914,676 (110,000) 804,676 1,218,616 75,887 1,650,618 727,111 2,377,729 (3,860,816) 5,038,188 9,994,654 2,797,667 12,792,321 16,651,637 $ 5,114,075 .$ 11,645,272 $ 3,524,778 $ 15,170,050 $, 12,790,821 , 19 CITY OF PEARLAND,TEXAS COMBINED STATEMENT OF REVENUES,EXPENDITURES,AND CHANGES IN FUND BALANCES.-BUDGET AND ACTUAL- GENERAL AND DEBT SERVICE FUNDS Year Ended September 30,2000 General Fund Variance Favorable Budget Actual (Unfavorable) Revenues Property taxes and penalties $ 5,907,278 $ 5,876,495 $ (30,783) Other taxes 3,863,000 3,697,523 (165,477) Licenses and permits 934,700 1,469,799 535;099 Fines and forfeitures 716,500 731,959 15,459 Franchise fees 2,050,000 2,022,789 (27,211) Charges for services 3,164,650 3,061,545 (103,105) Intergovernmental revenues 359,200 15,000 (344,200) Other revenues 553,000 . ,827,950 274,950 Total Revenues '17,548,328 -17,703,060 154,732 Expenditures Current: General government 3,806,491 3,580,693 225,798 Public safety 6,347,009 5,944,516 402,493 Public works 5,862;888 5,635,397 227,491 Community services 1,806,122 1,762,770 43,352 Debt Service: Principal retirement - - - Interest and fiscal agent fees - - Total Expenditures 17,822,510 16,923;376 899,134 Other Financing Sources Operating transfers in 781;000 78'1,000, ' Operating transfers(out) (800,081) (922,967) (122,886) Operating in from component unit(P.E.D.C.) 110,000 110,000 Total Other Financing Sources(Uses), 90,919• (31,967), (122,886) Revenues and Other Financing Sources Over(Under) Expenditures (183,263) 747,717 930,980 Fund Balances-Beginning 4,457,492 4",457,492 - Fund Balances-Ending $ c4,274,229 $ .5,205,209 $ 930;980 See Notes to Financial Statements. 20 Exhibit 3 Debt Service Fund Variance Favorable Budget Actual (Unfavorable) $ 3,342,006 $ 3,468,083 $ 126,077 20,000 110,157 90,157 3,362,006 3,578,240 216,234, 1;455,000 1,605,000 (150,000 00) 1,920,000 1,459,038 460,962 3,375,000 3,064,038 310,962 (12,994) 514,202 527,196 208,324 208,324 - $ 195,330 $ 722,526 $ 527,196 21 CITY OF PEARLAND, TEXAS Exhibit 4 STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN RETAINED EARNINGS - ALL PROPRIETARY FUND TYPES (ENTERPRISE FUND) Year Ended September 30, 2000 Enterprise Operating Revenues Water & sewer sales and services $ 7,105,559 Other revenue 40,472 Total Operating Revenues 7,146,031 Operating Expenses Production and wastewater 2,207,296 Distribution and collection 618,633 Accounting and collections 279,313 Other requirements 338,568 Construction 455,479 Total Operating Expenses 3,899,289 3,246,742 Depreciation 959,756 Operating Income 2,286,986 Non-Operating Revenue Earnings on investments 1,599,406 Interest and fiscal charges (1,326,348) 'Amortized bond issuance costs (37,637) Total Non-Operating Revenues (Expenses) 235,421 Income Before Operating Transfers 2,522,407 Operating Transfers In (Out) Operating transfers in 128,000 Operating transfers (out) (781,000) Net Income 1,869,407 Retained Earnings - Beginning 3,337,91'3 Retained Earnings - Ending $ 5,2'07,320 See Notes.to Financial Statements 22 CITY OF PEARLAND,TEXAS Exhibit 5 COMBINED STATEMENTS OF CASH FLOWS- ALL PROPRIETARY FUND.TYPES(ENTERPRISE FUND) Year Ended September 30,2000 Enterprise Cash Flows from Operating Activities Operating income $ 2,286,986 Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation expense .959,756 Changes in Assets and Liabilities. (Increase)in accounts receivable (207,142) (Increase)in due from other funds (560,464) Increase in customer deposits 111,642 Increase(decrease)in accounts payable 583,197 Increase(decrease)in accrued compensated absences (27,090) (Decrease)in deferred charges (37,638) (Decrease)in accrued liabilities (42,848) Increase in due to other funds 63,008 Net Cash Provided by Operating Activities 3,129,407 Cash Flows from Noncapital Financing Activities Operating transfers in 128,000 Operating transfers(out) (781,000) (653,000) Cash Flows from Capital and Related Financing Activities 'Contributed capital-impact fees 2,032,440 Proceeds from Revenue Bonds 8,000,000 Purchase of fixed assets (9,410,748) Revenue bond principal payments (420,000) Capital lease principal payments (62,360) Interest payments on revenue bonds (1,326,348) Amortized issuance expense on revenue bonds 37,637 (1,149,379) Cash Flows from Investing Activities Interest on investments , 1;566,836 1,566,836, Net(decrease) in cash 2,893,864 Cash and Cash Equivalents-Beginning 25,332,240 Cash and Cash Equivalents-Ending $ 28,226,104 Cash 27,800,968 Restricted Cash 425,136 Cash and Cash Equivalents-Ending $ 28,226,104 See Notes.to Financial Statements. 23 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL STATEMENTS September 30,2000 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Pearland, Texas, was incorporated.in December 1959 and adopted the "Home Rule Charter" February 6, 1971, pursuant to the laws of the State of Texas. The City operates under a "Council-Manager" form of government and provides services authorized by its charter Presently, these services include police and fire protection, 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. The financial statements of the City of Pearland have been prepared in conformity with generally accepted accounting principles (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The more significant of the City's accounting policies are described below. A. Reporting Entity The City is an independent political subdivision of the State of Texas, governed by an elected mayor and five member council, and is considered a primary government. As required by generally accepted accounting principles, these general purpose financial statements have been prepared based on considerations regarding the potential for inclusion of other entities, organizations, or functions as part of the City's financial reporting entity The Pearland Economic Development Corporation (PEDC.) has been included in the City's financial reporting entity as a discretely presented component unit. The City is considered a primary government for financial reporting purposes and its activities are not considered a part of any other governmental or other type of reporting entity Considerations regarding the potential for inclusion of other entities, organizations, or functions in the City's financial reporting entity, are based on criteria prescribed by generally accepted accounting principles. These same criteria are evaluated in considering whether the City is a part of any other governmental or other type of reporting entity The overriding elements associated with prescribed criteria considered in determining that the City's financial reporting entity status is that of a primary government are that it has a separately elected governing body; it is legally separate; and it is fiscally independent of other state and local governments. Additional prescribed criteria under generally accepted accounting principles include considerations pertaining.to organizations for which the primary government is financially accountable; and considerations pertaining to other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity's financial statements to be misleading or incomplete. As required by generally accepted accounting principles, the financial statements of the reporting entity include those of the City of Pearland (the primary government) and its component units, entities for which the City is considered to be financially accountable. Blended component units, although legally separate entities, are, in substance, part of the government's operations and so data for these units would be combined with data of the City The City has no blended component units The City's discretely presented component units is reported in a separate column in the combined financial statements. 24 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL• STATEMENTS September 30,2000 • `NOTE 1 - SUMMARY OF-SIGNIFICANT ACCOUNTING POLICIES(continued) A. Reporting Entity Discretely Presented Component Unit: The PEDC responsible for economic development within the City's jurisdiction. The, members .of'the PEDC governing board are- appointed by City Council. However; the PEDC is"fiscally dependent upon the government because the City Council approves the PEDC's budget and must approve any.debt issuances. The PEDC is accounted for in-a proprietary fund type. Additional financial information for the PEDC may be.obtained at the PEDC's administrative offices at the following address. Pearland Economic Development Corporation 3519 Liberty'Drive Pearland,Texas 77581-5416 B. Fund Accounting The City uses funds- and account groups to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management`by segregating transactions related to certain,government functions"or activities. A fund is a separate accounting entity'with a self=balancing set of accounts. An account group, on the other hand, is a financial reporting device designed to provide•accountability for certain assets and liabilities that are"hot recorded-in the funds because they do hot directly affect net expendable available financial resources.The"follovi+ing is a description of the various funds and account.groups: ' Governmental"Fund Types General Fund , r A 'The General Fund is used to account for all financial transactions not properly includable in other funds. The principal sources of revenues of the General Fund.are property taxes, sales and use taxes, franchise fees, permit fees, and fines and forfeitures. Expenditures are for general government,finance,public safety, public works, park maintenance and recreation, municipal court, planning and zoning, and engineering. Special Revenue Funds The Special Revenue Funds are used to account for all 'financial transactions. for the Regional Detention, Municipal Court, Hotel/Motel'Tax, Park-Donations, Park and Recreation Development, Tree Donation, Tree Trust, Police, Federal. Police,_ Community Service Fund, and special grant. revenues where the funds"are for specific uses. 25 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL STATEMENTS September 30,2000 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) B. Fund Accounting(continued) Debt Service Fund The Debt Service Fund is used to account for the payment of interest and principal on all general obligation debts of the City The primary source of revenue for debt service is local property taxes. Capital.Projects Funds The Capital Projects Funds are used to account for the proceeds from the sale of general obligation bonds and certificates of obligation and expenditures of these proceeds for the acquisition of fixed assets as designated in each bond issue. Proprietary Fund Types Enterprise Fund The Enterprise Fund is used to account for those operations that are financed and operated in a manner similar to private business or where the Council has decided that the determination of revenues earned, costs incurred, and/or net income is necessary for management accountability The Enterprise Fund is used to account for the City's water and sewer service operations. Account Groups General Fixed Assets Account Group General fixed assets are not capitalized in the funds used to acquire or construct them. Instead, capital acquisition and construction are reflected as expenditures in governmental funds, and the related assets are reported in the general fixed asset account group All purchased fixed assets are valued at cost. Donated fixed assets are valued at their estimated fair market value on the date received. The costs of normal maintenance and repairs that do not add to the value of the asset, or materially extend asset lives, are not capitalized. Improvements to fixed assets are capitalized. Assets in the general fixed asset group are not depreciated. Interest is not capitalized on general fixed assets acquired through the issuance of tax exempt debt. Public domain (infrastructure) general fixed assets, consisting of roads,bndges, curbs and gutters, streets, and drainage systems, are capitalized. General Long-Term Debt Account Group This account group is used to account for the City's long-term liabilities, which include general obligation bonds, certificates of obligation and obligations under capital leases due at varying dates through 2020, and the long-term liability for employees' accrued compensated absences. 26 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL STATEMENTS September 30,2000 NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) C. Basis of Accounting The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. As such, only current assets and current liabilities generally'are included on the balance sheet. Operating statements of these funds present increases (revenues and other financing resources) and decreases(expenditures) in net current assets. The proprietary fund type is accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and all liabilities associated with the operation of the funds are included on' the balance sheet. Fund equity (net total assets) is segregated into contributed capital, if applicable, and retained earnings components. Proprietary fund-type operating statements present increases (revenues)and decreases (expenses)in net total assets. The modified accrual basis of accounting is used by the governmental fund types. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (when they become both measurable and available). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. The City considers the majority of its major revenues as available when collected. Expenditures are recorded when the related fund liability is incurred. Principal and interest on general long-term debt are recorded as liabilities when due. Those revenues susceptible to accrual under the modified accrual basis are property taxes and other taxes (primarily sales taxes), franchise fees, intergovernmental revenue, and interest revenue. Licenses and permits and fines and forfeitures revenues are not susceptible to accrual because generally they are not measurable until received in cash. The City recognized deferred revenue on its balance sheet. Deferred revenue arises when potential revenue does not meet both the "measurable" and "available" criteria for recognition in the current period. The accounts of the proprietary fund type are maintained, and the financial statements have been prepared, on the accrual basis of accounting. Under this basis, revenues are recognized when they are earned and expenses are recognized when they are incurred. The proprietary fund type follows generally accepted accounting principles prescribed by the Governmental Accounting Standards Board (the GASB) and all Financial Accounting Standards Board's standards issued prior to November 30, 1989 Subsequent to this date, the City accounts for its proprietary fund type as prescribed by the GASB 27 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL.STATEMENTS September 30,2000 r ' NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) D. Budgets Annual budgets are-adopted for the General and Debt Service Funds: The City does not legally adopt an annual budget for the Special Revenue and Capital Project Funds.'The City adopts project budgets for the Capital Projects and Special Revenue Funds, which are revised annually These budgets are created by ordinance and include all sources and uses of funds as approved by Council. All ,annual .budgets are prepared on a basis consistent with generally accepted accounting principles (GAAP). Encumbrance accounting is utilized_in all'governmental fund types. Encumbrances fdr'.materials, other goods,, 'and purchased services are documented by purchase orders or contracts. Encumbrances outstanding at year-end do not constitute expenditures or liabilities. The City generally'honors these commitments, and it has been the City's-practice. to increase the subsequent year's appropriations to complete these transactions. At year-end, 'the City reserved a portion of fund balance for outstanding encumbrances of$294,544 in the General Fund and.$2,260,550 in the Capital Projects Fund. E. Cash and Temporary Investments Cash and temporary investments consist of amounts in an interest bearing time deposit account, petty cash funds, Texpool and Lone Star Investment Pool. Texpool and Lone Star '.Investment Pool are external investment pools established by interlocal contract under state law Investments are stated at fair value based on quoted market prices at,September 30, 2000 The net-increase or decrease in the fair value of investments is recorded as investment earnings. Investments are generally held'to maturity 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 securities and disclosed,as -part of the City's investments. The City pools excess cash of the various individual funds to purchase .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 its respective share of pooled investments. F. Receivables All'trade receivables are shown'net.of.an'allowance for Uncollectibles. Property-taxes are recorded as revenue when levied for-the current year and due, payable, and collected in the current year Uncollected amounts at year end are.reported as deferred,revenue. Property taxes collected within sixty days subsequent to September 30,2000,were not considered, material. 28 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL STATEMENTS- September 30,-2000 NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING,POLICIES(continued) G. Interfund Receivables and Payables During the course of operations,transactions occur between individual funds for specified purposes. Thesereceivables and-payables are classified as "due from other funds" or,"due to other funds" on the combined balance sheet. H. Use of:Estimates, 1 The preparation of financial statements, in conformity with,generally accepted accounting principles, requires management to make estimates and assumptions that affectthe reported amounts of assets and 'liabilities and disclosure'of contingent assets.and liabilities at the date'of the,financial statements and the ,reported amounts of revenues, expenditures, and expenses during the reporting period. Actual results could differ from those estimates. I. Use of.Estimates Inventory, which consists of gasoline'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 used. J. Restricted Assets Certain proceeds of Enterprise Fund revenue bonds, as well as .certain ,resources set 'aside for their, repayment, are classified as restricted assets on the combined balance sheet because,their use is limited by applicable bond covenants. ', K. 'Compensated`Absences Compensated absences, which include unpaid vacation, sick, and other employee benefit amounts, are accumulated during employment. Amounts accumulated are paid to,employee,s upon separation from City service. Under the modified accrual basis of accounting, such amounts are recorded in.the General Long-Term Debt.Account Group net of amounts expected to be, liquidated with expendable available, financial resources at the end of the fiscal,year, which are recorded as.expenditures of the General•Fund. Compensated absences are accrued when incurred in the proprietary'funds and recorded as a fund liability L. Fund Equity, Contributed capital is recorded in Proprietary Funds that have received "capital grants or contributions front, developers, customers, or Other funds. Reserves represent those portions of fund equity not available''for expenditure or legally segregated fora specific future use. Designations of fund balance represent,tentative management plans that are subject to change. 29 CITY OF'PEARLAND, TEXAS NOTES.TO FINANCIAL STATEMENTS September 30,2000 NOTE 1.- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) M. Cash and Cash Equivalents For the purpose Of the Statement of Cash Flows, the Proprietary Fund'Type considers all investments with original maturities of'three'months or less from the date of acquisition to'be cash equivalents. - N. Total.Columns on Combined Statements Total columns'on the combined statements 'are captioned'(Memorandum'Only) to indicate that they arc presented only to facilitate financial analysis. -Data in these columns do not present financial position or results of operations for the City as a whole in- conformity with generally accepted accounting principles. NOTE 2-BUDGETARY COMPLIANCE The City Manager, on or'before the tenth day of July of each year, shall submit to Council a proposed budget. The Council shall review the,proposed budget and revise as deemed appropnate prior to circulation for public hearing. After the public hearing,.the Council may adopt the'budget with or without amendment. In amending the,budget, Council may add or increase programs or amounts and may delete or decrease any amount, , except expenditures required by law or for debt or for estimated cash deficits, provided no amendments to the budget shall'increase the authorized"expenditures,to an amount greater than the total of estimated income in,addition to funds available from prior years. City management may legally amend the adopted budget in any manner as long as the.amendments do not exceed total appropriations by fund. However, City management has adopted the practice of submitting for City Council's formal approval all'budget amendments that increase total department appropriations by'fund. The Council shall adopt.the budget by the 15th of September of"each.year Adoption of the budget shall constitute.appropriation of the amounts specified therein as expenditures and shall constitute a levy of the property tax therein proposed. Every appropriation lapses at the close of the fiscal year to the extent it has not.been expended. Any encumbered appropriation lapses at year-end but is generally reappropriated'as part of the subsequent year's budget. Expenditures may not legally exceed appropriations at the fund level. At any time during the fiscal year, the City Manager may request Council to transfer by ordinance any unencumbered appropriation balance'between funds. No significant supplemental appropriations were necessary during the year 30 CITY OF PEARLAND, TEXAS 'NOTES-TO FINANCIAL STATEMENTS September 30,2000 NOTE 3 - DEPOSITS (CASH)AND INVESTMENTS `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, deposits with financial institutions, short term investments in external public funds investment pool accounts,Texpool'and Lone 'Star and other investments which have maturities at purchase date of less than three months. The restricted cash includes cash-on deposit withfmancial institutions. For better management of-cash, the City pools the cash,based on the City's needs; into either deposits in the-bank; in short term investments with'Texpool, and Lone Star, or in longer-term investments in commercial paper or US. Government; securities. However,each ftind's balance of cash and investments is maintained in the bboks of the City The Council has adopted a written investment policy-regarding the investment of-its funds as defined by Public Funds Investment Act(Chapter 2256 Texas Government Code). The investments of the City are in compliance with the:Council's investment policies. 'It is the City's policy to restrict its investments to direct obligations of the U S. .Governrnent, commercial paper, fully-collateralized certificates of - deposit and other interest-bearing time and demand deposits, and other instruments and investments in public funds,investment pools such as the Texas Local Government Investment Pool (Texpool), and Lone Star, Special purpose trust companies authorized by the Texas Legislature-in 1986. State law provides that collateral pledged as security for bank deposits.must have a market value of not less than the 'uninsured amount of the deposits and must consist of (1) obligations of the United State&-of 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. Cash and Cash equivalents :At year-end, the.City had cash on hand, bank deposits,deposits with Texpbol'and Lone Star as follows. Cash Cash Bank Equivalent On Hand , Deposits Investments Total , 'General $ 775 $, 303,125 ,$ 6,19.9,560 $ 6,503',460 Special Revenue' - 543,997 15,0,00 558,997 Debt Service - 86;473 649,541 736,`0:14 Capital'Projects - 1,156,295 3,893,312 5,049,607 , Enterprise 800 , 7,048,736 21,176,568 28,22.6,104 Component Unit. 885,9741 2,657,046 _ 3,543,017 $, 1,575 $ -1.0,024,597 $ .34;59,1,027 .$ 44,617,199 J , 3.1 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL STATEMENTS September 30,2000 NOTE 3-DEPOSITS (CASH)AND INVESTMENTS (continued) Credit Risk Categorization for Deposits It is the City' policy for deposits to be 100% secured by collateral valued at market or par, whichever is lower, less the amount of the Federal Deposit Insurance Corporation,insurance. The City's pooled and non-pooled deposits are categorized to gve,an indication of the level of risk assumed by the. City at September 30,2000. The categories are described as follows. Category 1- Deposits which are insured or collateralized with securities,held, by the City or'by its agent in the City's name. Category 2- Deposits which are collateralized with securities held by the pledging financial institution's trust department or agent in the City's name. Category 3- Deposits which are not collateralized or collateralized with secunties held by the pledging financial institution or by its trust department or agent but not in the City's name. The City's deposits in banks of.$10,024,597 at year-end were entirely covered by federal depository insurance Or by acceptable collateral held by.the City's agent in the City's name. The deposits in Texpool and Lone Star of $34,591,027 are not evidenced by securities that exist'in physical or book entry form and, accordingly, are not categorized by risk. However, the nature of these funds requires that they be used to purehase investments -authorized-by the Public Funds Act. 'The_ primary objective of these investment pools is to provide a safe environment:for the placement of public funds in short-term, fully collateralized investments. Texpool and Lone Star operate in a manner consistent with the SEC's Rule 2a7 of the Investment Company Act of 1940. The pools use amortized cost, rather than market value, to report net assets to compute,share prices. Accordingly, the fair value of the positions'in Texpool and Lone Star is the,same as the values of Texpool and Lone Star shares. Fair value of'investments are based on quoted market prices in accordance with GASB Statement No: 31, Accounting and Financial Reporting for Certain Investments and for External,Investment Pools. The amount of increase or decrease in the fair value of investments during the year ended September 30,. 2000 was not significant. Texpool The State Comptroller of Public. Accounts:exercises-oversight responsibility over Texpool, the Texas Local Government Investment Pool. Oversight includes the ability to significantly influence operations, designation of management and accountability for fiscal matters. Additionally,:the State Comptroller has established an advisory board composed of both participants in Texpool and Other'persons who do not have a business relationship with Texpool. The.Advisory'Board members review the investment policy and management fee structure. Finally,Texpool is rated AAAm by Standard &Poors, as'well as the office of the Comptroller of Public Accounts for review 32 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL STATEMENTS September.30,2000 NOTE 3-DEPOSITS (CASH)AND INVESTMENTS (continued) Lone_Star The Lone Star investment pool was- created pursuant to. the Interlocal Cooperation. Act, Texas Government Code, Chapter 791, and -the.Public' Funds Investment Act, Texas Government 'Code; Chapter 2256. The primary objective of this.pool_is to maintain the safety of principal, while providing participating government entities with the highest,possible rate Of return for invested funds. Participants own pro rata interests in the underlying assets of the,fund in which they participate. A.participant's,sole 'source of payment from its investment in the,pools is the market value of such assets. Pursuant to investment.agreements approved by each participant.with the pool,the business and affairs of the pools .are required to be' managed by the:pool's .Board- of Trustees (the Board.) The Board is consists'of members, representing entities that have adopted the investment agreements. The duties of the board-includes,:but are not limited to, adopting investment policies, appointing investment officers-,„ overseeing.the selection of investment managers, custodian banks, 'investment consultants, and other. service providers, monitoring compliance with the pool's investment policy,, monitoring performance, and revising the investment policies to reflect.changing,'conditions affecting the pool or the needs.of the participants. - Pursuant to Section 2256.016(g) of the Investment Act, these pools have established advisory boards. composed of.participants and other knowledgeable individuals.The purpose of the advisory boards shall be to, gather and exchange information from participants and non-participants relating to the pools' operations. NOTE 4-PROPERTY TAXES -Property taxes for each'year are required-to be levied by September 1'5 and are due upon receipt Of the :City's tax bill and become delinquent on February 1.of the following year On January 1,of each year, a tax lien is attached to the property to secure.the payment of all taxes,penalties, and interest. The lien exists in the favor of the-State and each.taxing unit. Appraised'values are established* the Central Appraisal District (CAD) of Brazoria County, Texas, through procedures. established by the Texas- Legislature. The Pearland Independent School District bills and collects the City's property taxes: The procedure for.collection of delinquent taxes-is to send out delinquent notices'and a letter and then refer the delinquent counts to the Tax Attorney for legal action., The Home Rule.Charter requires the foreclosure proceedings no:later than two years after taxes first become.delinquent. - A penalty of 7% is added,to delinquent taxes .on February 1 and increases 2%. each month through. September An additional penalty,of 15% is added in July for attorney costs. There are no discounts` allowed in taxes. , , - The City is permitted,,by Article'XI,.Section 5, of the State of Texas Constitution and:the City'Charter, to levy property taxes up to $2.50.per $100 of assessed valuation,for general governmental services. Within the$2.50 maximum levy, there is no legal limit upon the amount of-property taxes, which can.be ,. levied for debt service. The propertytax rates to finance general governmental-services and.debt service for the 1999-2000'tax year were$.44.000.and$.25500;respectively,per$100 of assessed valuation'. The 1999 assessed -value and total tax levy as.adjusted through`September'30, 2000, were $1,320,032,285 and S$9,174,224,respectively 33 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL.STATEMENTS September 30,2000 NOTE - PROPERTY TAXES (continued) The following is,an analysis of the September 30, 2000, delinquent,tax balances in the General and Debt Service Funds,'by year of levy General Debt Service Year of Levy Fund Fund Total 1999 $ 157,941 $ 48,899 $ 206,840 1998 58,325 313,802 92,127 1997. 30,440 17,641 48,081 1996 15,690 9,093 24,783 1995 12,480 7,233 19,713 1994, 13,807 8,207 22,014 1993 9,271 '6,982 16,253 1992 2,548 > 2,519 5,067 1991. 2,966 2,821 5,787 1990 3,674 4,102 7,776 1989 and prior 12,404' 18,325 30,729' $ 319,546' $ 159,624 $ 479,170 The City has enacted an ordinance providing for the-exemption of $25,000 of the assessed value of residential homesteads of persons 65 years of age or older from property taxes. This is provided by Section 1-b(a) of Article 8 of the Constitution of Texas. An exemption of$10,000 is allowed disabled persons-on homesteads and ,up to $3,000 is allowed disabled veterans on any one piece of property Additionally, the market value of agricultural land is reduced"to-agncultural value for purposes of the City's tax levy calculation. The 1999 assessed values, reduced by exempt property, exemptions, and reduction in market value of , agricultural land, were as follows. Assessed valuation. Real property $ 1,346,642,050 Personal property. 174,353,848 1;520,995,898 Exempt property 73;929,590 • Other Exemptions: Over 65 homestead 37,858,579 Disabled veterans 1,337,790 Freeport 7,036,630 House Bill 366 6,910 Abatement 3,431,990 Pollution 48,970 Prorated Exempt Property 127,974 •Homestead Cap Adjustment 30,285,070 Agricultural use,and historical exemptions. 46,900,110 127,034,023 'Net assessed valuations $ 1,320,032,285 34 I i CITY OF PEARLAN.D,'TEXAS NOTES TO FINANCIAL STATEMENTS September 30,2000 NOTE 5-CHANGES IN FIXED ASSETS The following is a summary of changes in general fixed assets for the year ended September 30,2000: Balance Balance Oct.'1, 1999 Additions Deletions 'Sept.30,2000 Land $• 1;497,777' $ 15,500 $ - $ '1,513,277 Buildings 7,381;658' 2,506,576' -' 9,888,234 Construction in progress 2,339,349 - 2,339,349 Improvements other than buildings 26,196,265 - (778,937) 25,417,328, Machinery and equipment 9,426,575. 749,514 - 10,176,089 Totals $, 44,502;275 .$ 5,610,939 $ (778,937)- $ 49,334;277 The following is'a°summary Of changes in.the Enterprise Fund,fixed assets for the year ended September 30,_ 2000: Balance Balance Oct. 1, 1999 Additions. .D,eletidns Sept. 30,2000 Land $ 189,071 $, - $ - - $ '189,071 Equipment 2,224,368 100,170 - 2,324,538 Buildings and improvements 19,706,357 .8,723,599 - 28,429,956, Construction in Progress 7,557,945 8,473,652 (7,886,676) . 8,144,921 . .29;677,741 17,297,421. -(7,886,676) 39,088,486 Less allowance for depreciation (9,248,415) . . (959,756) - (10;208,171)- Totals $ 20,429,326 $ 16,337,665 .$ (7,886,676) $ 28,880;315 • Depreciation on Enterprise Fund fixed assets is recorded using the straight-line method over the following estimated useful lives of.the assets. Description Estimated Useful Lives, Equipment 5 to 10 years Buildings and infrastructure, 3 to 50 years. t , 35 - CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL STATEMENTS September 30,2000 NOTE 6- LONG-TERM DEBT A. General Long-Term Debt The following is a summary of general long-term debt transactions for the year ended September 30, 2000• Balance Balance October 1, September 30, 1999 Additions Retirements 2000 Certificates of Obligation $ 17,525,000 $ - $ (1,650,000) $ 15,875,000 General Obligation Bonds 15,105,000 10,830,000 (12,550,000) 13,385,000 Capital Leases 826,209 - (444,959) 381,250 Compensated Absences 1,098,112 117,417 -. 1,215,529 $ 34,554,321 $ 10,947,417 $ (14,644,959) $ 30,856,779' Certificates,of Obligation and General Obligation Bonds Certificates of obligation and, general obligation bonds at September 30, 2000, are comprised of the following individual issues. Principal Payment Interest Interest Date/ Payment Debt Issue Rates Maturity Dates Outstanding $5,000,000 Public Works 5.00% to March 1/ March 1/ Series 1995 7.00% 2014 Septemberl $ 4,425,000 $6,250,000 Tax and Re.venue 5.25% to March 1/ March 1/ Series 1997 7.25% 2016 Septemberl 6,050,000 $5,500,000 Tax and Revenue 5.20% to March 1/ March 1/ Series 1997 A 7.20% 2018 Septemberl 5,400,000 Subtotal Certificates of Obligation 15,875,000 $10,830,000 Refunding Bonds 6 00% to March 1/ March 1/ Series 2000 8.00% 2009 September) 10,830,000. $6,510,000 Refunding Bonds 2.65% to March 1/ March 1/ Series 1993 4.63% 2003 Septemberl 2,555,000 Subtotal General Obligation Bonds 13,385,000 Total $ 29,260,000 36 CITY OF.PEARLAND, TEXAS ' NOTES'TO FINANCIAL.STATEMENTS September 30,2000 NOTE 6-LONG-TERM DEBT(continued) The annual requirements to amortize all certificates of obligation and general obligation'bonds outstanding ' as-'of September 30, 2000 areas follows. Year Ending Sept. 30,2000 . Principal , Interest. Total 2001 $ 1,395,000 $ 1,547,675 $. 2,942,675 2002 1,285,000 1,433,683' 2,718,683 2-003 1,515,0.06 1,359,616 2,874,616 '2004. 1;730,000 , 1,273,739 3,001,739 2605 2,030,000 1,176,766 , 3,;206;766 2006-2016 2.1,305,000 , 6,273;808 27.,578,808. ,,,$ '29,260,000 $ ' 13,065,286 .$ 42,3;25,286 'There is,$722,526 available in the Debt Service .Fund to service the above obligations and the City's Obligations under capital leases. Obligations Under Capital.:Leases Capital,leases:bear interest rates ranging-from 4.38% to 5 85% and have maturity dates ranging from 2001 to: 2002. Annual,requirements'to satisfy these Obligations follow• Year Ending Sept..30,2000 Principal . Interest Total 2001 $ 306,526 $ 14,200 $ 320;726 '2002 74,724 , 1,636 76,360' $ 381,250 $ 15,836 ,5' . 397;086 Compensated Absences Employees earn vacation leave at the'rate:of fifteen days per year from one to fifteen years, twenty days per year.for service of sixteen to 'nineteen years, and.twenty-five days-per year'for service of twenty-years .or more. Employees -are required to take their earned vacation. Employees whb are unable,to use their ' , vacation,for various reasons,'may, with the City Manager's'approval, carry over fifty percent of the unused portion of the vacation, Or,receive compensation for a maximum of forty hours. City employees receive eleven,paid holidays per year Employees 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 Employees may be paid or receive compensatory time. The maximum accrual for overtime is 160 hours, except for employees involved in public safety, who can accrue up to 320 hours. 37 CITY OF PEARLAND, TEXAS ' NOTES TO FINANCIAL STATEMENTS , September 30,2000 , , 'NOTE 6-LONG-TERM DEBT(continued) _ Compensated Absences(continued) The liability for compensated absences at September 30,,2000, is comprised of the.following components Vacation $ 139;827 'Sick 9:11,501 Compensatory Time 164,201. $ 1,21,5,529 A. Enterprise'Fund Debt The following is a summary of Enterprise'Fund long-term debt transactions of the City for the year'ended September 30,2000: Balance- Balance October 1', September 30, ' . . 1999' Additions Retirements 2000 Water&Wastewater 1 Revenue.Bonds $ 9,045,000 $ 8,000,000' $ (370,000) $ 16,675,000 Certificates of Obligations 17,100,000 ' (50,000) ,17,050,000 'Capital.Leases ,62,360, _ (62,360) $ 26;207,360- $ 8,000,000 $ (482,360) $ 33,725,000 Revenue Bonds and Certificates of Obligation A summary of the terms of revenue and certificates of obligation bonds recorded in the Enterprise Fund as of September.30, 2000, is a follows. Principal Payment Interest Interest Date/ Payment Debt Issue Rates Maturity, Dates ..Outstanding $1,115,000 Water&Sewer Revenue Bonds 4.5%,to Sept. 1/ .March 1/ Series 1996 A .5.20% 2002 September I $ 400,000 $8,870,000.' Water&Sewer Revenue Bonds 2.9%to Sept. 1/ March 1/ Series 199'6 B 4.85% -2016 September 1, 8,275,000 $8,000,000 Water&Sewer Revenue Bonds Sept. 1/ March 1/ Series,1999 4 90% 2020 September 1 8;000,000 Subtotal Water&Sewer.Revenue Bonds 16,675,000 $17,100,000 , Certificates of Obligation 2.60% to March I/ March 1/ Series 1998 A 3.80% 2,018' September 1 17,050,000 Subtotal Certificates of Obligation . 17,050,000 Total, " $' 33,725,000 38 , CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL:STATEMENTS September 30,2000 NOTE 6-LONG-TERM DEBT'(Continued)' A. Enterprise.Fund Debt"(continued) „ Revenue BOnds and Certificates of Obligation(continued) ` The annual'requirements to amortize all revenue bonds and certificates of obligation outstanding as;of' ` September'30,.2000,areas follows. Year Ending ' September 30, , Principal . Interest Total. 2001 $' ' 585,009 $' 1,378,844 ' $ .1,963,844 2002 4;485,000 1,352,903 5,837,903 2003 4;360,000 1,132;990 5,492,990 ' 2004 540,000 929,848 1,469,848 2005 1,310,000 898,1'86. 2,208,-186 ' 2006-2018' 22,445,006 6,377,138,, '28;822,138 $ ' 33,725,000 $ 12,069',909.. $ 45;794,909, B. Annual Debt Service Requirements , , The annual requirements to amortize all.long.-tern debt outstanding at'September 30-, 2000,including interest payments and exeluding compensated absences, are as follows. ' General Enterprise Year Ending Long-Term .Fund . September 30, . Debt Debt , Total '2001 $ 1,263;401 ' $ 1,963,844- $ '5,227,245 . 2002 2,795",043 /5,;837,903' 8,632;946 ' 2003 2,874,616 5,492,990 8;367,606 2004 3,093,739 1,469,848 4,473,587 , 2005 3,,20.6,766- 2,208,,,186' 5,414,952- 2006-2018 27,578,867 ,,28,822,138 56,400,945, 42,722;372 45,794,909 ,88,517,280 Less interest (13.',08,1,122), (12,069,909) , „(25,151,031) $ -29,641,250 $ 33,725,000 $' 63;366,249 , '39 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL STATEMENTS September 30,2000 NOTE 7—OPERATING TRANSFERS BETWEEN FUNDS For the year ended September 30,2000, operating transfers between funds consisted of the following: Fund Transfers in (out) Transfers in Transfers out General Fund Enterprise fund $ 781,000 Subtotal 781,000 General Fund Component Unit(P E.D C) 110,000 Special Revenue General 100,000 Capital Projects Capital Projects General 572,081 Street Assessment General 122,886 Subtotal 694,967 Enerprise Fund General 128,000 General Fund (Capital Projects) (572,081) General Fund (Enterprise fund) (128,000) General Fund (Street Assessment) (122,886) General Fund (Special Revenue) (100,000) Subtotal (922,967) Enterprise Fund (General Fund) (781,000) Component Unit(P E.D C ) (General Fund) (110,000), Totals '$ 1,813,967 $ (1,813,967) 40 CITY OF PEARLAND, TEXAS' NOTES TO FINANCIAL.STATEMENTS , September 30;2000 NOTE.8 FUND EQUITY The City's Capital Project'Fund-equity at September 30, 2000, has been designated for subsequent'years' expenditures. Tentative plans for the expenditure of these resources are as-follows: ; Transportation.Improvements ,r $ 1,410,859 , Drainage improvements 1,442,666 $ . , , 2,8"53',525 'Deficit Fund Balance ` The following TIRZ#2 fundhad a deficit fund balance of the following amounts as of September 30, 2000: Fund Balance Fund. (Deficit)' TIRZ#2 ,$ (21",086) NOTE 9—CONTRIBUTED CAPITAL A summary of changes in contributed capital is as follows. Enterprise Fund., Beginning Balance .$ 16,021,808 Impact Fees 2,032,442 , Ending Balance $ , . - '1-8,05,4,250 NOTE.10- PENSION.PLAN Plan Description -The City provides pension benefits for all of its" full-time employees through a nontraditional, joint contributory, hybrid defined benefit plan in the state-wide Texas Municipal Retirement System (TMRS),. one of 73.1 administered by TMRS,an agent multiple-employer public employee retirement system. Benefits depend upon 'the s'um of the employee's 'contributions. to the plan;, with interest, and' the 'City- financed monetary,credits, with interest. At the date the"plan began, the'City granted monetary credits for service rendered before"the plan began of,a theoretical amount equal tb two times what"would have beet} contributed by the employee, with interest, prior to establishment Of the_plan. Monetary"credits for service since the plan began,are a percent-(100%, 150%, or 200%) of the employee's accumulated contributions. In addition, the City can grant,as often as annually, another type of monetary credit referred to,as an updated service credit which,-is a theoretical amount which, when added to the employee's accumulated contributions and the."monetary credits for service since the plan began', would be the total monetary credits and employee contributions,accumulated with interest,if the current employee contribution rate and City matching"percent 4'1 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL STATEMENTS September 30,2000 NOTE 10-PENSION PLAN(continued) Plan Description(continued) had always been in existence; and if the employee's salary had always been the average Of his salary in the last three'years that are one year before the effective date. At retirement,.the benefit is calculated as if the , sum of the employee's accumulated contributions, with interest, and the employer-financed monetary credits, with interest, were used to purchase an annuity Members can retire at age 60 and above with 10'or more years of"service or with 20 years of service regardless of age. A member is vested after 10 years. The plan provisions are adopted by the governing.body of the City, within the options available in the state statutes governing TMRS.and within the actuarial constraints also in the statutes. Contributions The contribution rate for the employees is 7% and the City matching ratio IS currently 2 to 1, both as adopted by the governing body of the City 'Under the state law governing TMRS, the actuary annually determines the City contribution-rate. This rate consists of the.normal cost contribution rate and the prior service contribution rate,both of which are calculated to be a level percent of'payroll from year to year The normal cost contribution. rate finances the'currently accruing monetary credits due to the'City matching percent, which are the obligation of the City as of,an ,employee's retirement date, not at the time the employee's contributions are made. The normal cost contribution rate is the actuarially determined percent of payroll necessary to satisfy the obligation of the City to each employee at the-time his/her retirement becomes effective. The. prior service contribution rate amortizes the unfunded (overfunded) actuarial liability (asset) over the remainder of the plan's 25-year amortization period. The unit credit actuarial cost method is, used for determining the City contribution rate. Both the employees and -the City make contributions monthly Since the City needs to know its contribution rate in advance for budgetary process, there is a one-year delay between the actuarial valuation that is,the basis for the rate and•the5calendar year when the rate goes into effect. (i.e: December 31, 1999, valuation is effective for rates beginning January 2001) Because the actuary determines contribution rates on an annual basis and the City pays the calculated tate each month, the City Will always have a net'pension-obligation (NPO) of zero at the beginning and end of the period, and the annually required contributions (ARC) will always .equal contributions made. Trend information regarding,ARC and NPO is shown below City Fiscal Year ,2000 1999 1998 , Net Pension Obligation(NPO)at the _ Beginning of the Period $ $ 7 $, - Annual Pension Costs Annual Required Contribution.(ARC)' 736,702- 629;516 '543;300 Contributions`Made 736,702 629,516, 543,300 Increase in NPO , - - NPO at the End of the'Period $ - $ - $ - %.Annual Pension Cost.Contributed 100% 100% 100% 42 CITY OF PEARLAND,,TEXAS NOTES TO FINANCIAL STATEMENTS -September 30,2000 NOTE 10-PENSION PLAN(continued) Contributions(continued) A.schedule,of'funding progress for TMRS for the three most recent-actuarial valuations maybe found in the required supplementary information section of the City's Comprehensive Annual Financial Report: Information as to the latest actuarial valuation-follows: Valuation Date- - 12/31/99 Actuarial'Cost Method Unit'Credit Amortization Method Level.Percent of'Payroll Remaining Amortization Period 25 Years-,Open Period Asset Valuation Method Amortized Cost Actuarial Assumptions Investment Rate of Return 8% Projected Salary Increases None ' Includes Inflation At None Cost-of-living Adjustments , None- The City is one of 731 municipalities having its benefit plan administered'by-TMRS Each of the 731 ' municipalities has an-annual; individual actuarial valuation performed. All'assumptions for the December 31, 1998, valuations are contained in the 1998 TMRS Comprehensive Annual Financial Report, a copy of which may be Obtained by writing to P O Box 149153,,Austin;Texas 78714-9153 NOTE 11 - 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 (TML- IRP), an 'Intergovernmental- Risk-Pool and through commercial insurance carriers. The City purchases commercial- general insurance through the Texas Municipal League, an unincorporated association of political subdivisions of the State of Texas. This policy encompasses general liability, incidental, medical - malpractice, automobile liability, law enforcement liability, errors and omissions liability, property, automobile vehicle liability, and damages with limits of liability for each occurrence. The City-has riot 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 participation of the City in-the TML-IRP is limited to payment of premiums. At year-end, the City did not have any significant claims pending. 43 CITY OF PEARLAND, TEXAS NOTES TO FINANCIAL STATEMENTS September 30,2000 NOTE 11 -RISK MANAGEMENT (continued) Workers' Compensation The City is a member of the Texas Municipal League (TML) Workers' Compensation Intergovernmental Risk Pool, an unincorporated association of political subdivisions of the State of Texas. The fund contracts with a third party administrator for administration, investigation, and adjustment services in the handling of claims Premiums are based on the estimated City payroll by risk factor and rates. The premiums are adjusted by the City's experience modifier All loss contingencies, including claims incurred but not reported, if any, are recorded and accounted for by the TML Pool. The City's liability is limited to the payment of premiums as assessed by TML. NOTE 12- FEDERAL TAX COMPLIANCE(ARBITRAGE) FOR LONG-TERM DEBT In accordance with provisions of Section 148 of the Internal Revenue Code of 1986, as amended, (the "Code") the City's long-term debt obligations must meet certain minimum criteria to be considered and continue to be considered "tax exempt" This "tax exempt" status means that interest income earned by purchasers of the City's long-term debt instruments is not subject to federal'income taxes. Related Treasury Regulations promulgated under section 148 of the Code generally provide that the determination of whether these obligations are tax exempt is made as of the date such obligations are issued based on a reasonable expectations regarding the use of the proceeds of the bonds issued. Long-term debt that does not meet and continue .to meet the minimum criteria of Section 148 of the Code and the related Treasury Regulations described above are considered"arbitrage bonds"and are not considered"tax exempt"as described above. Rebate Obligations will become arbitrage bonds (as described above) if certain arbitrage profits are not paid to the federal government as rebate under section 148(f) of the Code. The City's obligations to calculate and make rebate payments (if any) will, continue as long as there are gross proceeds allocable to outstanding debt issues. The City has performed calculations required under section 148(f) of the Code and has no present liability nor has the City ever been required to make rebate payments for issued debt in past years. Unexpended Debt Issuance Proceeds(Yield Restriction Requirements) Section 148 of the Code also provides that in order for debt not to be considered arbitrage bonds (as described above), proceeds of such debt must be invested at a yield that is not materially higher than the yield on the debt issued starting on the third anniversary of the issue date of such debt. Accordingly, any unexpended proceeds of debt issued by the City that remain unexpended more than three years after such debt was issued should be yield restricted. The yield restriction may be accomplished by making yield reduction payments pursuant to Treas. Reg. Section 1 148-5(c). The City is currently pursuing compliance with these yield restriction requirements and does not anticipate associated significant noncompliance issues. The City is continuing to proceed with reasonable diligence to expend any remaining unexpended debt issuance proceeds on qualifying projects. 44 INFORMATION ANT Amy IN�'O� RE VIREO SUPPLEMENT 45 CITY OF PEARLAND, TEXAS REQUIRED SUPPLEMENTARY INFORMATION (Unaudited) September 30,2000 PENSION DATA - TEXAS MUNICIPAL RETIREMENT SYSTEM The City's annual covered payroll and annual pension cost are actuarially valued on a calendar year basis. Because the City makes all of the annually required contributions, no net pension obligation exists. The information presented below was determined as part of the actuarial valuation, as of December 31, for each period presented. Schedule of Funding Progress UAAL Actuarial Actuarial As A Actuarial Value of Accrued Unfunded Annual Percentage Valuation Plan Liability Percentage AAL Covered of Covered Date Assets (AAL) Funded (UAAL) Payroll Payroll 12/31/96 $ 7,543,433 $ 8,901,254 84 7% $ 1,357,821 $ 5,656,996 24 0% 12/31/97 8,759,905 11,129,222 78 7% 2,369,317 6,820,450 34 7% 12/31/98 9,615,238 12,280,029 78.3% 2,664,791 6,787,171 39.3% 12/31/99 10,976,420 14,117,504 77.8% 3,141,084 7,189,179 43 7% 46 ,� GROUPUN ASIS AN"��pUL'ES DING AND L ST ATL� CpN1S FINAL 41 T�YIN)TYPES G O�g�EN 49 (this page intentionally left blank) 50 ` � ' . ` ` ' ` ^ ' ` . ^ ' , . ^ . ` ' - ' ` ` ` . . ' ' to tct�° _ , ` The illellada ^ ^ ' � ^ - .� ' - . . - ' ` ` ^ ^ ' ` ' , ^ 51 ` ' ^ ' - CITY OF PEARLAND,TEXAS Exhibit A-1 GENERAL FUND COMPARATIVE BALANCE SHEET September 30,2000 and 1999 2000 1999 Assets _ Assets Cash and cash equivalents $ 6,503,460 $' 5,624,286 Receivables: Property taxes 319,546 233,139 Accounts 443,563 256,450 Less. Allowance,for estimated uncollectibles (63,008) Accrued interest 31,943 14,782 Due from other funds 63,008 - Inventories ,51,678 60,000 Total Assets $ 7,350,190 $ 6,188,657 Liabilities and Fund Balance Liabilities Accounts payable $ 797,699 $ 1,061,203 ' Accrued liabilities 253,535 239,816 ' Due to other funds 610,015 - Accrued Compensated Absences 164,186 197,007 Deferred'revenue 319,546 233,139 Total'Liabilities 2,144,981 1,731,165 Fund Balance Reserved for encumbrances 294,544 155,481 Unreserved. Undesignated 4,910,665 4,302,011 Total Fund Balance 5,205,209 4,457,492 Total Liabilities and Fund Balance $ 7,350,190 $ 6,188,657 52 CITY OF PEARLANI),TEXAS Exhibit A-2 GENERAL FUND •STATEMENT OF REVENUES,EXPENDITURES,AND CHANGES IN FUND BALANCE-BUDGET AND ACTUAL Year Ended September 30,2000 with comparative actual amounts for the Year Ended September 30,1999 2000 Variance Favorable 1999 Budget Actual (Unfavorable) Actual Revenues Property taxes and penalties $ 5,907,278 $ 5,876,495 $ (30,783) $ 5,260,551 Other taxes 3,863,000 3,697,523 (165,477) 3,426,576 Licenses and permits 934,700 1,469,799 535,099 955,819 Fines and forfeitures 716,500 731,959 15,459 675,691 Franchise fees 2,050,000 2,022,789. (27,211) 1,943,545 Charges for services 3,164,650 3,061,545 (103,105) 2,960,214 Intergovemnental revenues 359,200 , 15,000 (344,200) 489,860 Other revenues 553,000 827,950 274,950 655,582 Total Revenues 17,548,328 17,703,060 154,732 16,367,838 Expenditures Current: General government 3,806,491 3;580;693 225,798 3,685,523 Public safety 6,347,009 5,944,516 402,493 5,695,956 Public works 5,862,888 5,635,397 227,491 5,137,708 Community services 1,806,122 1,762,770 43;352 1,580,624 Total Expenditures 17,822,510 16,923,376 899,134 16,099,811 Revenues Over(Under) Expenditures (274,182) 779,684 1,053,866 268,027 Other Financing Sources(Uses) Operating transfers in 781,000 781,000 - 1,000,000 Operating Transfers(out) (800,081) (922,967) (122,886) (389,384) Operating transfer in from component unit 110,000 110,000 - 110,000 Total Other Financing Sources(Uses) 90,919 (31,967) (122,886) 720,616 Revenues and Other Financing Sources Over (Under)Expenditures (183,263) 747,717 930,980 988,643 Fund Balance-Beginning 4,457,492 4,457,492 - 3,468,849 Fund Balance-Ending $ 4,274,229• $ 5,205,209 $ 930,980 $ 4,457,492 53 CITY OF PEARIAND,TEXAS Exhibit A 3 GENERAL FUND SCHEDULE OF REVENUES-BUDGET AND ACIUAL Page 1of3 Year Ended September 30,2000 with comparative actual amounts for the Year Ended September 30,1999 2000 Variance ' Favorable 1999 Budget , _ Actual (Unfavorable) Actual Property Taxes and Penalties Property taxes-current $ 5,764,278 $ 5,626,664 $ (137,614) $ 5,059,928 Piopeity taxes-delinquent 70,000 119,461 49,461 96,094 Penalties and interest 50,000 58,231 ,8,231 79,217 Attonry fees 20,000 22,371 2,371 23,586 Mrsc.Tax Revenue 3,000 49,768 46,768.. 1,726 • ' 5,907,278' 5,876,495 (30,783)- 5,260,551 Other Taxes City retail sales tax 3,851,003 3,684,676 (166,324) 3,415,183 State beverage tax 12,000 12,847 847 11,393 3,863,000 3,697,523 ' (165,477) 3,426,576 licenses and Permits Building pests 525,000 686,073 161,073 472,674 Electrical Pt mrits 60,000 73,701 13,701 75,221 Marling&gas permits 65,000 94,819 29,819 83,857 Platting Fees 45,000 50,396 5,396 52,051 Mechanical Pernits 50,000 74,316 24,316 59,592 Beer Permits 3,000 4,310 1,310 4,167 Moving Permits 10,000 8,100 (1,900) 10,900 Garage Sale Pemits 20,000 18,937 (1,063) 17,538 Electrical licenses 20,000 14,635 (5,365) 14,741 Animal licenses 6,000 9,324 3,324 6;409 Peddlers&Solicitors 500 1,900 1,400 525 Health Certificate Fees - 18,997 18,997 355 Wrecker Pemits 5,000 4,900 (100) 3,900 Culvert Permits 3,000 2,338 (662) 3,667 Building Plan Check Fee 15,000 347,538 332,538 100,977 Occupancy Permits 2,500 2,225 (275) 3,192 Plan&Zare Board of Adj. 62,500 21,079 (41,421) 11,050 Demolition pemits 200 250 50 95 Kennel licenses - 50 50 100 Bldg.Site Work Per nit - 21,862 21,862 712 Alariupemits 2,500 2,788 288 2,723 Reinspec.Fee/Inspection 4,500 800 (3,700) 2,447 Sign penrits 4,000 4,253 253 3,821 Health '31,000 6,208 (24,792) 25;110. 934,700 1,469,799 535,099 955,819 54 CITY OF PEARLAND,TEXAS Exhibit A-3 GENERAL FUND SCHEDULE OF REVENUES-BUDGET AND ACTUAL Page 2of3 Year Ended September 30,2000 with comparative actual amounts for the Year Ended September 30,1999 2000 ' Variance Favorable 1999 Budget Actual (Unfavorable) Actual Fines and Forfeitures Child Safety $ - $' - $ $ Child Safety-Harris Co. 1,500 1,849 349 1,782 Mun.Court-Bldg.Security 15,000 (26,832) (41,832) 14,723 Fines 700,000 756,942 56,942 659,186 716,500 731,959 15,459 675,691 Franchise Fees Gas 85,000 71,604 (13,396) 78,512 Electric utility 1,175,000. 1,163,224 (11,776) 1,133,646 Telephone Company 300,000 315,192 15'192 263,146 Cable television 125,000 124,814 (186) 114,882 Sanitation 365,000 347,955 (17,045) 353,359 2,050,000 2,022,789 (27,211) 1,943,545 Charges for Services False Alarm Fee 1,000 25 (975) - Clean Pearland Bldg.Rent 2,400 1,600 (800) 2,200 Land Rental - - - 4,000 Fleet Repairs - - - Fuel Service Center - - - Basketball Programs 8,000 8,365 365 9,585 Trash Revenue 2,300,000 '2,156,943 (143,057) 2,127,315 Sanitation Billing Fee 135,000 122,763 (12,237) 126,561 MUD/EMS/Fire Collections 55,000 53,470 (1,530) 51,800 Animal Shelter 18,000 18,279 279 18,427 Disposal of Animals 2,000 3,940 1,940 3,800 Police Programs - 97 97 399 Fingerprint Fees 750 535 (215) 690 Tennis Programs 2,000 6,992' 4,992 .5,936 Recreation Programs 80,000 94,252 14,252 163,375 Learnto'Swim Programs 27,500 26,065 (1,435) 19,801 Community-Building,Rental 37,500 21,213 (16,287) 29,978 Senior Citizens Programs 3,000 4,040 1,040 2,707' Swimming Pool Fees 25,000 18,234 (6,766) 15,365 Pool Rental 3,500 2,259. (1,241) 3,080 Pavilion Rental 3,500 190 (3,310) 1,270 Ambulance Service Fee 375,000 377,377 2,377 302,180 Rental Gazebo&Pavilion 5,000 4,590 (410) 2,795 Soccer Program 27,500 48,004 20,504 38,795 Softball Program 50,000 76,449 26,449 82,861 Barbecue Shelter Rental 3,000 1,760 (1,240) 1,370 Fourth of July - - - 1,007 Winter Fest - 12,433 12,433 '2,390 Dog Trot - 1,670 1,670 2,527 3,164,650 3,061,545 (103,105) 2,960,214 55 CITY OF PEARLAND,TEXAS Exhibit A-3 GENERAL FUND SCHEDULE OF REVENUES. BUDGET AND ACTUAL Page 3 of 3 Year Ended September 30,2000 with comparative actual amounts for the Year Ended September 30,1999. 2000 . ' Variance Favorable 1999 Budget Actual (Unfavorable) Actual Intergovernmental Revenues Grant PD Radar Trailer $ $ $ $ 13,010 Grant Police Department 300,000 (300,000) 368,998 Grant-Gal.Co.Task Force 43,500 (43,500) 50,776 Grant-Forestry Program 15,000 15,000 6,643 Emergency Mgmt.Asst Grant 15,700 - (15,700) - Grant Park - - 25,496 Grant E.M.S. - 17,817 Solid Waste Enforcer -. - 7,120 . 359,200 15,000 (344,200) 489,860 Other Revenues City Brochure 3,500 4,331 831 4,680 Report Copies-Police Dept 3,000 4,896 1,896 4,945 Bids&Specs 1,500 - (1,500) 1,670 Cash Short/Over - (181) (181) 11 Donations-Concert/Band - 8,750 8,750 4,920 Donations Planning 500 500 - Donations Animal Shelter - 289 Donation-Park (5,179) (5,179) 2,322 Donation-Hyde Park - - - 5,000 Reimbursements Misc. - - - 4,484 Reimbursements Phone&Fax - 3,023 3,023 Reimbursement-Worker Comp - 14,315 14,315 2,519 Reimbursement P.LS.D. 154,000 173,721 .19 721 162,479 L.E.O.S.E.Training Fire - - - 650 Plat Copies 4,500 -1,548 (2,952) 5,372 L.E.O.S.E.Training P.D. - - 4,829 Reproduction/Xerox Copies 1,500 3,285 1 785 1,851 Econ Develop Sponsorship - 580 Reimbursement-Insurance 983 983 35,865 Texpool Interest 248,195 248,195 166,900 Payroll Interest ,1,001 1,001 394 N.O.W Account Interest 23,934 23,934 5,033 Interest Income 290,000 126,175 (163,825) 94 104 Credit Card-Interest - 2,830 2,830 364 Miscellaneous 16,000 73,028 57,028 28,556 Auction - 3,955 3,955 - Street Light Charges 30,000 86,408 56,408 48,975 N.S.F Fees 1,000 1,375 375 1 100 Sand/Topsoil 40,000 43,416 3,416 61,136 Discount Taken 55 55 '55 Pool/Park Vending Machine 1,500 '1,331 (169) 1,061 Comm.Center Vending Machine 1,500 2,010 510 1,273 City Hall Vending Machine - 202 202 109 Concession Stand 5,000 4,043 (957) 4,056 553,000 827,950 274,950 655,582 Total Revenues $ 17,548,328 $ 17,703,060 $ 154,732 $ 16,367,838 56 , ' , , Y , , CITY OF PEARLAND,TEXAS- , , ' 'Exhibit A-4 GENERAL FUND ,- SCHEDULE OF EXPENDITURES-BUDGET AND ACTUAL ` Page 1of 6 Year Ended September 30,2000 ` with comparative actual amounts for the Year Ended September 30,1999 ' ,2000 ' Variance ' ' Favorable. 1999 , Budget Actual (Unfavorable) Actual , General Government , City Council. Personnel . $ , "20,023 $ 22,249 $ (2,226) $ 18,593• Commodities ' 2;000 1,114" ' -886 '823' ' , Contractual-services 45,600 27,313 18,287 30,578 Other services 5,000 , - 5,000- - 1 Capital outlay. - ' , - 123 - : 72,623 50,676 21,947 -• ,-50,117 City Manager , Personnel 463,368 454,104 9,264 271,611 •Comidities' 4,500 7,248 (2,748) '2,455 Contractual services 6,180 3,700 ' 2,480 ,22,622 Other services 35,840 27,866 7,974 160 Capital outlay , 5;528 (5,528) .17,308 ' • '509,888 498,446 11,442, ' `314;156 City.Secretary Personnel 83,122. ,85,388 (2,266) 75,170 1 Commodities 4;000 3,623 377 3,222 ` Contractual services 1,750 1,300 450 31,818 Other services 42,156 26,090 , 16,066 '9,193 1 Capital outlay - . - , , . - 2,242 • . 131,028: •, 116,401 . -14,627 121,645. Finance , Personnel 429,085 424,197 4,888 391;883 Commmdities , 11,250 11,862 ` (612) 12,006 Contractual services 2,700' 5,305 (2,605) 33,498 Other services 37,975 28,342• •9,633 - Capital outlay - . - . . - 21,186. . 481,010 , . , 469,706 . . 11,304 . . 458,573 Tax , Contractual services. . , 135,000 .133,231 1;769 122,788 135,000 � 133,231 ' , 1,769 122,788 , Human Resources Personnel ' 279,910 270,293 9,617' - 263,542 , Commodities 14,688 , 7,722 6,966 9,076, Contractual services 2,200 1,901 299' 42,661 Other services, 42,840 41,896 944 - Capital outlay . . ,, 1,612 . , (1;612) .6,729 339,638 ' 323,424 . 16,214 . 322,008 , r ' . .57 ' ' CITY OF PEARLAND,TEXAS Exhibit A-4 GENERAL FUND SCHEDULE OF EXPENDITURES-BUDGET AND ACTUAL Page 2 of 6 Year Ended September 30,2000 with comparative actual amounts for the Year Ended September 30,1999 2000 Variance , Favorable 1999 Budget . Actual (Unfavorable) Actual General Government(con't) Legal Personnel $ 171,566 $ 172,015. $ (449) $ 139,361 Commodities 7,025 4,345 2,680 1,796 Contractual services 1,000 247 753 159,083 Other services 69,570 87,777 (18,207) 80 Capital outlay - - 3,298 249,161 264,384 (15,223) 303,618 Municipal Court Personnel 204,092 194,713 9,379 155,474 Commodities 3,545 6,591 (3,046) 2,851 Contractual services 5,850 1,471 4,379 14,910 Other services 16,210 12,917 3,293 660 Capital outlay 2,000 2,537 (537) 7,466 231,697 ` 218,229 13,468 181,361 Custiodial Services Personnel 144,920 121,901 23,019 113,288 Commodities 27,248 25,702 1,546 24,311 Contractual services 2,880 1,887 993 .1,751 Otherservices 1,560 729 831 - Capital outlay - - . 5,975 176,608 150,219 26,389 145,325 City Hall Personnel. - - - 12,485 Commodities 19,631 17,483 2,148 48,950 Contractual services 114,194 108,160 6,034 233,869 Other services 230,641 228,589 2,052 5,633 Capital outlay - - - 9,565 364,466 354,232' 10,234. 310,502 Public Affairs/Grants Personnel 186,828 130,342 56,486 220,004 Commodities 75,521 48,310 27,211 61,660 Contractual services - - - 36,448 Other services 48,095 33,004 15,091 - Capital outlay - 5,317 . (5,317) , 16,431 310,444 216,973 93,471 '334,543 58 CITY OF PEARLAND,TEXAS 1 Exhibit A-4 GENERAL FUND ' SCHEDULE OF EXPENDITURES-BUDGET AND ACTUAL, , , Page 3 of 6 Year Ended September 30.2000 with comparative actual amounts for the Year Ended September 30,1999 , , 2000 , ' - Variance ' , ' Favorable ' '1999 Budget Actual (Unfavorable) _Actual General Government(ain't) _ -Other ' .Personnel $ - $ , - •$ $ '12,500 Contractual services 697,959 720,254 (22;304) ,636,303, , Other services , 106,978 64,518 • 42,460 _ •'372,084 • )804,928 784,772 20,156 1,020,887- , Total General Government 3,806,491 ,3;580,693 225,798 , 3,685,523. Public Safety , Police ' Personnel 4,270,094 3,814,646 455,448 3,660,767 .Commodities 86,518 74,655 .11,863 L 80;263 ' .Contractual services 257;384 331,805 (74,421) 564,930 Other services 254,725 214,088 40,637 8,092 Capital outlay 171,815, 173,930 (2;115) ' '191,103 . . 5,040,536 4,609,124 431,412 4;505,155 - , Fire Personnel - - Commodities 38,907 37,442 1,465 24,990 Contractual-services 41,847 ' 44,664 (2,817) ,54,065 'Other services 42,775 39,618 3,157 1,075 Capital-outlay . 56,257 ,55,980 277 55,464 179,786 177,704, '-2,082 135;594 - Firre Marshall Personnel. - 105,368 94,274 ,,11,094 95,390 Commodities .9,700 9,670. ' 30 9,959 , Contractual services _ 5;500 10,591 (5,091) , 17,476' Other services 33,850 27,143 „ 6,707 Capital outlay . , - - .. . - . , , 12,332 ', 154,418 . 141,678 .12,740 '135,157 Animal Shelter ,. Personnel 149,136 148,713 423 , 137,523 ' Commodities 6,911 7,224 (313) 6;463 Contractual services 17;780 23,313 (5;533) ,. 24,751 Other services 17;630 ,15,305 '2,325 448 Capital outlay 1,350 , , , 2,254.. . (904)• 22,053 . `192;807 " , .196,809 .. . :(4,002) 191,238 _ c 59 CITY OF PEARLAND,TEXAS ' Exhibit A-4 'GENERAL FUND - t SCHEDULE OF EXPENDITURES-BUDGET AND ACTUAL ' Page4of6 Year Ended September 30,2000 , with connarative actual amounts for the Year Ended September 30,1999 2000 , , ,- _ Variance 1 Favorable 1999 K Budget Actual (Unfavorable) Actual Public Safety(con't) Emergency Medical Services Personnel $ ' 388,777 $ 463,834 $ (75,057) $ '533,408 Conniodities 89,372 i 85,214 4,158 68,645 Contractual services 82,387 78,305 4,082 110,182 , Other services 105,007 74,402 '30,605 1,310 Capital outlay 113,919 1.17;446 (3,527) 15,267 , , 779,462 819,201 (39,739) _ , 728,812 Total Public Safety 6,347,009 . .5,944,516 402,493 5,695,956 Public Works Adninistration Personnel 114,532 116,488 (1,956) 109,061 Commodities 7,850 _ 7,712 138 6,751 ' Contractual services 4,550 `5,328 (778) .11,479 , Other services 5,250 4,402 848 - Capital outlay . - - - 3,917 132,182 - 133,930. - ` (1,748) 131,208 , Personnel 510,045 494,577. 15,468 426,657 Commodities 6,081 5,961 120 4,743 Contractual services 9,620 12,754 (3,134) 19,298 Other,services 281,995 182,423 99,572 - Capital outlay , 28,500 .. 16,720 . 11,780 22,946 836,241 712,435 123,806 - , 473,644 Code Enforcement Personnel 324,303 318,106 6,197 407,189 Commodities 33,020 ' 17,427 15,593 7,343 - Contractual services 11,525 14,767 (3,242) 42,145 Other services .39,341 54,221 (14,880) 160 Capital outlay - •- 13,981 408,189 -, . - 404,521 . '3,668- , 470,818 Cormunity Services Commodities .10,000 •10,000 - 5,400 10,000 10,000 - 5,400 60 r , CITY PEARLAND,TEXAS Exhibit A-4 GENERAL FUND SCHEDULE OF EXPENDITURES-BUDGET AND ACTUAL Page^5 of 6 , Year Ended September 30,2000. ' with comparative actual anniints for the Year.Ended September 30,1999 - 2000 . , ' Variance ^Favorable 1999 Budget Actual, -(Unfavorable) Actual Public Works(con't) Fleet Maintenance Personnel $ 209,670 $ 203,465 $ 6,205 $ 201;365 t Coninndities 5,330 4,783 , 547 4,684, Contractual services. 6,320 -7,035 '(715) 6,542, Other'services 3,660 1,128 ` 2,532 - Capital outlay 2,136 224,980, ,' 216,41 1 8,569 214,727 Service Center ` Conui,odities 17,119 21,949 (4;830) 18,692 Contractual services 48;340 41,691 6;649 71,864 Other services :55,259 58;809- (3,619) - Capital.outlay ' - . - , 4,711, 120,709. 122,509 (1,800) 95,267 Street and Drainage r Personnel 472;344, 428,719 43;625 370,715' Corrinndities "253,455 251,066 2;389 203,012 Contractual services- 590;500 .584,269 6,231 621,046 Other services 355,962 378,453' (22;491) 80 Capital outlay , ; 92,000 , 90,360 1;640 65,720 1 _ ' ' 1,764,261 . 1,732,867 31,394 1,260,573 r Sanitation Contractual services 2;366,326 . 2,302,724 63;602 2,486,071 2,366,326 . . 2;302,724 ,63,602 2,480,071 Total Public Works , „' 5,862;888. 5,635,397 227,491 5,137,708. ` , L , t , 61, ' , CITY OF PEARLAND,TEXAS Exhibit A-4 GENERAL FUND SCHEDULE OF EXPENDITURES BUDGET AND ACTUAL Page 6 of 6 Year Ended September 30,2000 with comparative actual amounts for the Year Ended September 30,1999 2000 Variance Favorable 1999 Budget Actual (Unfavorable) Actual Community Services Library Personnel $ $ $ - $ - Commodities 2,100 2,328 (228) 1,921 Contractual services 2,600 2,922 (322) 1.8 436 Other services 35,500 54,601 (19 101) Capital outlay 6,360. 5,264 1,096 1,407 46,560 65,115 (18,555) 21,764 Parks&Recreation-Adminstration Personnel 633,097 540,939 92,158 469,239 Commodities 33,685' 25,991 7,694 26,528 Contractual services 143,842 189,864 (46,022) 237,533 Other services 111 429 104,221 7,208 785 Capital outlay 51,039 53,608 (2,569) , 90,112 973,092 914,623 58,469 824,197 Parks&Recreation-Recreation Personnel 240,284 226,533 13,751 223,980 Commodities 155,538 153 188 2,350 140,650 Contractual services 5 459 6,428 (969) 55 405 Other services 59 425 57,233 2,192 720 Capital outlay 7,850 (7,850) 6,125 460,706 451,232 9,474 426,880 Parks&Recreation-Athletics&Aquatics Personnel 133,472 109,696 23 776 118,903 Commodities 123,806 142,871 (19,065) 117 981 Contractual services 32,740 20,173 12,567 54 132 Other services 29,666 53,545 (23,879) 1,395 Capital outlay 6,080 5,515 565 15,372 325,764 331,800 , (6,036) 307,783 Total Community Services 1,806,122 1,762,770 43,352 1,580,624 Total Expenditures $ 17,822,510 $ 16,923,376 $ 899,134 $ 16,099,811 62 SPECIAL REVENUE FUNDS The Special Revenue Funds are used to account for specific revenues that are legally restricted for particular purposes. A description of the individual special revenue funds follows. Regional Detention Fund A fund created to account for the regional detention development. Municipal Court A fund created to account for municipal court fees collected. Hotel/Motel Afund created to account for the hotel/motel occupancy tax revenue. Park Donations A fund created to account for park donations. Park&Recreation Development A fund created to account for the development of parks. Tree Donations A fund created to account for tree donations. Tree Trust A fund created to account for tree trust donations. Police Fund To account for financial resources to be used for the Police department drug program. Federal Police Fund To account for expenditures related to special federal programs for the police department. Community Services To account for expenditures related to community services. Grant Fund To account for all grant revenues and expenditures. 63 CITY OF PEARLAND,TEXAS SPECIAL REVENUE FUNDS COMBINING BALANCE SHEET September 30,2000 with comparative totals for September 30,1999 Hotel Park& Regional Municipal 'Motel Park Recreation 'Detention Court Tax Donation Development Assets Assets Cash and cash equivalents $ 133,513 $ - $ 164,873 $ - $ 122,348 Due from others - 45,390 - 5 179 - Accrued interest receivable - - - - - Total Assets $ 133,513 $ 45,390 $ 164,873 $ 5,179 $ 122,348 Liabilities and Fund Balances Liabilities Accounts payable $ - $ - $ - $ - $ - Due to others - - - 1,019 - Total Liabilities - - - 1,019 - Fund Balances Fund Balances Unreserved. Designated for subsequent years'expenditures 133,513 45,390 164,873 4,160 122;348 Total Liabilities and Fund Balances $ .133,513 $ 45,390 $ 164,873 , $ 5,179 $ 122;348 64 Exhibit B-1 Tree Tree Federal Community Totals Donation Trust Police Police Services Grants 2000 1999 $ 1,312 $ 25,225 $ 36,973 $ 7,809 $ 23,715 $ 43,229 $ 558,997 $ 292,852 - - - - - 50,569 - - 88 - - 88 96 $ 1,312 $ 25,225 $ 37,061 $ 7,809 $ 23,715 $, 43,229 $ 609,654 $ 292,948 $ - $ - $ - $ - $ - $ 5,173 $ 5,173 $ 2,298 - , - - - - 1,019 - - - - - 5,173 6,192 2,298 1,312 25,225 37,061. 7,809 23,715 38,056 603,462 290,650 $ 1,312 $ 25,225 $ 37,061 $ 7,809 $ 23,715 $ 43,229 $ 609,654 $ 292,948 65 CITY OF PEARLAND,TEXAS SPECIAL REVENUE FUNDS' COMBINING STATEMENT OF REVENUES,EXPENDITURES,AND CHANGES IN FUND BALANCES Year Ended September 30,2000 with comparative totals for the Year Ended September 30,1999 i \--) Hotel Park& Regional Municipal Motel Park Recreation Detention Court Tax Donation Development Revenues Intergovernmental Revenue: Hotel/Motel Tax $ - $ - $ 47,937 $ $ Municipal Court - 45,390 - - - Regional Detention 32,736 - - - - Park/Tree - - - 7,821 121,450 Police Drug Revenue - - - - - Community Services Revenue - - - - Grants - - - - Total Intergovernmental Revenue 32,736 45,390 47,937 7,821 121,450 Other Revenue: Investment earnings 4,118 - 5,194 14 898 Total Other Revenue 4,118 - 5,194 14 898 Total Revenues 36,854 45,390 53,131 7,835 122,348 Expenditures General Government - - - - - Park Equipment - - - 3,675 - Community Services - - - - - Police Drug Expense _ - - - Total Expenditures - - - 3,675 - Revenues Over Expenditures 36,854 45,390 53,131 4,160 122,348 Other Financing Sources(Uses) Transfer In/(Out) - - - - - Fund Balances-Beginning 96,659 - 111,742 - - Fund Balances-Ending $ 133,513 $ 45,390 $ 164,873 $ 4,160 $ 122,348 66 r ' , Exhibit'B-2 s `j a _/ ,, (�a 'COTree' Tree " 'Federal -Community ; ,)0/' Totals , ' , Donation , Trust Police Police Services . Grant . 2000. 1999 ' $ - $ - $ - $ - $ _ $ - $ 47,937 $ 57,878 - _ - - - , - - 45,390- - _ _ - 32,7.36• 83,026 1,300 '25.000 - - - ' - 1 155;571 " 8,838 - , - - 8,838 1,307 - - - 18,653. - 18,653 22,538 - - _ - - 303,631 .303,631 2,445' 1,300 25,000 8,838- - 18,653 303,631 . 612,756 167,194 v 12, ,. . 225 , , . 1;432 345 . , 784• 4,547 17,569- •3,183 , 12 225 1,432 '345 784 4,547- t 17,569 3,183 ' 1,312 25,225 10,270 345' , . 19,437 308,178. 630,325 170,377 - , - - - 390;998 390,9,98 4;773 - ._ _ - - - 3,675 - _ - - 15,165. - 15,165 17,897 - ' " 5;669 , '2,006 , '' - i - 7,675 , 2,282 ,- 5,669, 2,006 15,165. . 390,998 ' 4-17,513 24,952 1,312 25,225 4,601 (1,661) 4,272 (82;820) ` 21'2,8.12 145,425_ - - - - - 100,000 100,000 - - - , , 32,460 9,470 19,443' 20;876, , 290,650 145,225- - $ 1,312 $ '25,225 $ 37,061 $ 7,809 ,'$ . 23,715. $, 38;056 $. 603,462 $' .290,650 , 67 (this page intentionally left blank) 68 ' ' ` - ` . ` ` ' ^ ` , . ' . / ' . ` . ^ ` ` . . ` - ' . . , . ' ' cV,FUND ayment - �u' ' ��1� � ` 6" ^- ��dx� ' Count for oov��-- ` ^ rle Debt Service all g rest On- o t .__� ` . ` , ` ` ` ' ^ . ` ' ` _ ' ' . ` - ` ` ` ` al ` 89 ^ ` ` CITY OF PEARLAND, TEXAS Exhibit C-1 DEBT SERVICE FUND COMPARATIVE BALANCE SHEET September 30,2000 and 1999 2000 1999 Assets Assets. Cash and cash equivalents $ 736,014 $ 208,324 Receivables Property taxes 159,624 156,306 Total Assets $ 895,638 $ 364,630 Liabilities and Fund Balance Liabilities Accounts payable $ 13,489 $ - Deferred revenue 159,623 156,306 Total Liabilities 173,112 156,306 Fund Balance Unreserved. Designated for debt service 722,526 208,324 Total Liabilities and Fund Balance $ 895,638 $ 364,630 70 I ' 1 ... ani of.PEARLAND,TEXAS Exhibit.C-2 DEBT SERVICE FUND STATEMENT OF REVENUES,EXPENDITURES,AND CHANCES IN FUND BALANCE-BUDGET AND ACI'UAL ' Year Ended September 30..2000 , with comparative actual balances for the Year Ended September 30,1999 , 2000 ', Variance Favorable 1999 BUdget, Aetna', (Unfavorable) Revenues - , Property Taxes and Penalties: Property taxes-current $, 3,342,006 $ 3,468,083 $ ,126,077 $ .2,932,376 , 3,342,006 3,468,083 '126,077 2932376 Other revenues- investrrent earnings . . 20,000 110,157 90,157 ' . 36,899 .. , Total Revenues , 3,362,006. 3578,240 ,216,234 2,969,275 . , Expenditures - Debt-Service: , Principal retirenent 1,455,000 1,605000 (150,0'0)) -,1,440,000 Interest , . 1,920,000 1;459,038 , 460,962 . , 1;760,270 • Total Expenditures 3,375,000 ,3,064,638 310,962 . 3;209,693 Revenues Over(Under) ' 4PendiOrts (12,994) 514;202 527,196 , (240,418) Other Financing Sources(USes) Transfers In/(Out) - - . - 175,000 . Total Other Financing Sources(UseS) . - . , . - ., 175,000 . , Revenues and Other Financing SouteEs Over(Under) Expenditures " (12,994) 514,202. 527,196 ' (65,418) a _ Rind pal,-Beginning 208,324 208,324 Fund Balance-Encling $ , 195,330 $ , 722,526 $ _, , 273,742, 527,196 $ . . 208,324 ,-. _ . , 71 (this page intentionally left blank) 72 CAPITAL PROJECTS FUNDS The Capital Projects Funds are used to account for all resources used for the acquisition and/or construction of all buildings, equipment, rights of way, street and drainage, improvements, and regional wastewater facilities. The funds used are described below Street Assessment A compulsory levy made against certain properties to defray all or part of the cost of a specific capital improvement or service deemed to benefit primarily those properties. Street Assessment-McHard Rd. A compulsory levy made against certain properties to defray all or part of the 'cost of a specific capital improvement or service deemed to benefit primarily those properties. Street Assessment-Southfork A compulsory levy made against certain properties to defray all or part of the cost of a specific capital improvement or service deemed to benefit primarily those properties. Street Assessment-Hooks Rd A compulsory levy made against certain properties to defray all or part of the cost of a specific capital improvement or service deemed to benefit primarily those properties Capital Project Fund A fund created to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds and trust funds) Road & Bridges To account for financial resources to be used for roads&bridges. Library To account for financial resources to be used for the City's library Capital Improvement 1997 To account for financial resources to be used for the facilities projects, transportation projects, drainage projects, and watershed projects. Certificate of Obligation—1997 To account for capital expenditures related to the issuance of certificates of obligation in August 1997 73 CITY OF PEARLAND,TEXAS CAPITAL PROJECTS FUNDS COMBINING BALANCE SHEET September 30,�200� with comparative totals for September 30,1999 F McHard Rd Southfork Hooks Rd Street Street Street Street Assessments Assessments Assessments Assessments Assets ' Assets Cash and cash equivalents $ 55,767 $ 187,533 $ 122,886 $ 54,827 Assessments Receivable 15,966 171,874 - 54,338 Accrued interest receivable 1,469 - 2,357 - Total Assets $ 73,202 $ 359,407 $ 125,243 $ 109,165 Liabilities and Fund Balances Liabilities Accounts payable $ - $ - $ $ - Deferred Revenue 31,566 - - - Total Liabilities 31,566 - - - Fund Balance Reserved for encumbrances - - - - Fund Balance 41,636 359,407. 125,243 109,165 , Total Fund Balance 41,636 359,407 125,243 109,165 Total Liabilities and Fund Balance $ 73,202 $ 359,407 $ 125,243 $ 109,165 74 Exhibit D-1 1y r i t , /0. ; `17 Capital Certificate Of Capital Roads and Improvement Obligation. Totals Projects Bridges Library 1997 1997 , 2000' 1999 , f I $ 711,017 $ 60,714 $ 10,845 $ 570,536, $• 3,275,482 $ 5,049,607 -$ 5;339;579 _ - '242,178 15,966. 3,826 1,336 .$. '711,017 $ 60;714 $; 10,845 $ ,' 570,536 $ 3,275,482 $ _ 5,295,611 $ 5,356;881• $ 1,267 $' 600 $ - $ 148,103 $' - $ 149,970, $ 302,727 - - , 31,566• 15,966 1,267, 600 - 148,103 - 181;536 318,693 31,547 19,585 - 1,790,254419,164 2,260,550 f 661,393. '678,203 40,529 , 10,845 (1,367,821) 2;856,318 2,853,525 4,376,795 709,750 '60,114. 10,845 422,433, 3,275,482 5;114,075 5,038,188 ,$ 711,017 $ 60;714 $ 10,845 .$ 570,536 $ 3,275,482 $ 5,295;611 $ 5;356,881 75 CITY OF PEARLAND,TEXAS CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES,EXPENDITURES, AND CHANGES IN'FUND BALANCES Year Ended September 30,2000 with comparative totals for the Year Ended September 30,1999 Mclard Rd Southfork Hooks Rd Street Street Street Street Assessments Assessments Assessments Assessments Revenues Investment earnings $ 5,289 $ 1,474 .$ 2,357 $ 488 Other - 357,933 - 108,677 Total Revenues 5,289 359,407 2,357 109,165 Expenditures Capital Outlay General Government - - - - Public Safety - - - - Public Works Utility Billing - - - Streets and transportation - - - - Drainage 79,200 - - - - Other projects - - - - Parks and recreation - - - Total Expenditures 79,200 - - - Revenues(Under)Expenditures (73,911) 359,407 2,357 109,165 Other Financing Sources(Uses) Transfer In from General Fund - - 122,886 - Transfer(Out)to Other Funds - - - - Proceeds from lease financing - - - - Total Other Financing Sources(Uses) - - 122,886 - Revenues and Other'Financing Resources Over(Under) Expenditures (73,911) .359,407 125,243 109,165 Fund Balances-Beginning 115,547 - s - Fund Balances-Ending $ 41,636 $ 359,407 $ 125,243 $ 109,165 76 , Exhibit D-2 Capital Certificate Of Capital Roads and Improvement Obligation Totals Projects Bridges Library 1997 1997 2000 1999 5 13,093 $ 2,376 $ $ 34,092 $ 210,365 $ 269,534 $ 346,145 145,481 27,2-19 639,310 347,895 13,093 2,376 1.79,573 237,584 908,844 694,040 , 40,720 - 40,720 538,436 100,832 - - 18,705 - 9,615 - 641,003 650,618 1,817,380 - 56,263 - 135,463 112,300 - 478,501 374,298 852,799 1,799,298 124,217 40,720 9,615 534,764 1,015,301 1,679,600 4,511,168 (27,627) (7,239) (355 191) (777,717) (770,756) (3,817;128) 572,081 - - 694,967 83,000 - - - - (75,000) 151,676 - - - - 151,676 425,000 723 757 - - - - •846,643 433,000 696,130 (7,239) - (355,191) (777,717). 75,887 (3,384,128) 13,620 67,353 10,845 . 777,624 4,053,199 5,038,188 8,422,316 $ 709,750 $ 60,114 $ 10,845 $ 422,433 $ 3,275,482 $ 5,114,075 $ 5,038,188 77 (this page intentionally left blank) 78 1 1 • r GRCAWS • ACC�U 19 (this page intentionally left blank) 80 1 -t 1 S 1 , , 1 t 1. ~ l 1XED p►5SETS of�,e City nt foY to at,cou tpe fixed arse ou4°f aecOunts used T1v s is a$elf,-balanein�� , gl , CITY OF PEARLAND,TEXAS Exhibit E 1 SCHEDULE OF GENERAL FIXED ASSETS BY SOURCE September 30,2000 and 1999 2000 1999 General Fixed Assets Land $ 1,513,277 $ 1497,777 Buildings 9,888,234 7,381,658 Construction in progress 2,339,349 - Improvements `25,417,328 '26196,265 Machinery and'equipment 10,176,089 . 9,426,575 Total General Fixed Assets $ 49,334,277 $ 44,502,275 Investments in General Fixed Assets Financed By Capital Proiects•Funds General Obligation bonds and Time warrants and certificates of obligatio❑ $ 35,061,742 $ 30,979,495 Lease Purchase agreement 425,519 395 743 Federal grants 395,576 395,576 General Fund Revenues 10,132,739 9,412,760 Special Revenue Fund Reserves 2,114,776 2,114,776 Special Assessments 510,286 510,286 Intergovernmental transfers 693,639 693,639 Total Investment in General Fixed Assets $ 49,334;277 $ 44,502,275 82 CITY OF PEARLAND,TEXAS Exhibit E 2 SCHEDULE OF CHANGES IN GENERAL FIXED ASSETS BY FUNCTION AND ACTIVITY Year Ended September 30,2000 Balance Balance Oct. 1,1999 Additions Sept.30,2000 General Government City Council $ 4,410 $ - $ 4 410 Human Resource 25 794 1,612 27,406 City Manager 56,333 5,528 61,861 City Secretary 38,207 - 38,207 Finance 54,483 54,483 Legal 33,283 - 33,283 Municipal Court 111,410 1,809 113,219 Custodial Services 49,718 - 49 718 City Hall 3,672,322 230,424 3,902,746 MIS 13,169 - 13,169 Total General Government 4,059 129 239,373 4,298,502 Public Safety Police 5,124,723 172,403 5,297,126 Fire 947 171 55 980 1,003,151 Animal Shelter 419,282 1,718 421,000' Code Enforcement 287,334 - 287,334 Civil Service 4,433. - 4 433 Fire Marshall 217,783 - 217,783 ' Emergency Medical Services 984,681 117,444 1,102,125 Total Public Safety 7 985,407 347,545 8,332,952 Public Works Public Works 1,442 973 - 1,442,973 Service Center 1,116,613 15,500 1,132 113 Fleet Maintenance 77 168 - 77.,168 Engineering 206,753 - 206,753 Sireet 21,605,883 61.1,442 22,217,325 Sanitation 453,653 - 453,653 Total Public Works ,24,903,043 626,942 25,529,985 Community Services Library 3,293,848 1 165,170 4 459,018 Parks, Recreation, Beautification 4,260,848 113,623 4,374,471 Total Community Services 7,554 696 1,278,793 8,833 489 Construction in Progress - 2,339,349 2,339,349 Total $ 44,502,275 $ , 4,832,002 $ 49,334.,277 83 CITY OF PEARLAND,TEXAS SCHEDULE OF GENERAL FIXED ASSETS BY FUNCTION AND ACTIVITY September 30,2000 Total Land Buildings ' General Government City Council $ 4,410 $ - $ - Human Resource 27,406 - - City Manager 61,861 - City Secretary 38,207 - - Finance 54,483 - - Legal 33,283 - - Municipal Court 113,219 - - Custodial Services 49,718 - -, City Hall 3,902,746 50,014 2,298,570 MIS 13,169 - - Total General Government 4,298,502 50,014 2,298,570 Public Safety Police 5,297,126 - 1,938,940 Fire 1,003,151 - 48,031 Animal Shelter 421,000 4,320 287,435 Code Enforcement 287,334 - - Civil Service 4,433 - - Fire Marshall 217,783 - 6,212 Emergency Medical Services. 11,102,125 - 212,625 Total Public Safety 8,332,952 4,320 2,493,243 Public Works Public Works 1,442,973 410,058 - Service Center 1,132,113 15,500 571,432 Fleet Maintenance 77,168 - - Engineering 206,753 - - Street 22,217,325 198,066 - Sanitation 453,653 57;236 7,010 Total Public Works 25,529,985 680,860 578,442 Community Services Library 4,459,018 5,000 3,464,092 Parks,Recreation, Beautification 4,374,471 773,083 1,053,887 Total Community Services 8,833,489 , 778,083' 4,517,979 $ 46,994,928 $ 1,513,277 $ 9,888,234 Construction in Progress. $ 2,339,349 Total General Fixed Assets '$ 49,334,277 84 Exhibit E-3 Machinery Improvements and Equipment $. $ 4,410 27,406 61,861 38,207 54 483 33,283 6,182 107,037 49,718 200 881 1,353,281 13,169 207,063 1,742,855 1,639 3,356,547 50,000 905,120 129,245 109,570 177,764 4,433 4,739 206,832 8,977 880,523 174,925 5,660,464 995,624 37,291 394,001 151,180 77,168 206,753 20,843,031 1 176,228 387,652 1,755 22,620,308 1,650,375 886,471 103,455 1,528,561 1,018,940 2,415,032 1,122,395. $ 25,417,328 $ 10,176,089, 85 (this page intentionally left blank) 86 GENERAL LONG-TERM DEBT This account group is a self-balancing group of accounts used to account for the City's long-term liabilities which include general obligation bonds,certificates of obligation,capital leases, and compensated absences. 87 CITY OF PEARLAND,TEXAS SCHEDULE OF GENERAL LONG-TERM DEBT SERVICE REQUIREMENTS TO MATURITY September 30,2000 Refunding Bonds, Due During Annual Requirements for All Series Series 1993-$6,510,000 Fiscal Year Total Total Total Principal Interest Due Ending Principal and Principal Interest Due March 1, Sept.30, Interest Due Due Due March 1 Septemberl Total 2001 $ 3,263,401 $ 1,701,526 $ 1,561,875 $ 1,030,000 $ 92,229 $ 1,122,229 2002 2,795,043• 1,359,724 1,435,319 770,000 52,244 822,244 2003 2,874,616 1,515,000 1,359,616 755,000 17 459 772,459 2004 3,003,739 1,730,000 ,1,273,739 - 2005 3,206,766 2,030,000 1,176,766 2006 3,190,893 2,125,000 1,065,893 - - 2007 3,199154 2,250,000 949,154 - - 2008 3,193,329 2,360,000 833,329 - 2009 3,182,981 2,470,000 712,981 - 2010 1,911,911 1,295,000 616,911 - 2011 1,920,526 1,375,000 545,526 - - 2012 1,929 191 1,460,000 469,191 - - 2013 1,932,500 1,545,000 387,500 - - - 2014, 1,947 111 1,645,000 302,111 - - - 2015 1,946,862 1,735,000 211,862 - - - 2016 1,949,595 1,835,000 114,595 - - - 2017 638,480 590,000 48,480 - - - 2018 636,275 620,000 16,275 Totals $ 42,722,372 $ 29,641,250 $ 13,081,122 $ 2,555,000 $ ' 161,932 $ 2,716,932 Obligations Under Bank One Obligations Under Bank One Due During Capital Leases Capital Leases Fiscal Year Principal Interest Due Principal Interest Due Ending , Due Due Due Due Sept.30, Annually Annually Total Annually Annually Total 2001 $ 57 701 $ 1,500 $ 59,201 $ 144,679 $ 8,043 $ 152,722 2002 74,724 1,636 76,360 2003 - - 2004 - - - - - 2005 - - - - 2006 - 2007 - - 2008 - - -- 2009 - 2010 - - 2011 - - 2012 - - - - 2013 - - - 2014 - - - - 2015 - - - - 2016 - - - - 2017 - - - - 2018 - - - - - - Totals $ 57,701 $ 1,500 $ 59,201 $ 219,403 $ ' 9,679 $ 229,082 88 Exhibit F(1 of 2) Refunding Bonds, Obligations Under IBM' Due During Series 2000-$10,830,000 Capital Leases Fiscal Year Principal Interest Due Principal Interest Due Ending Due March 1,. Due March 1, Sept.30, March 1 September 1 Total March 1 September 1 Total 2001 $ $ 576,320 $ 576,320 $ 49 037 $ 2,498 $ 51,535 2002 140,000 528,663 668,663 - 2003. 375,000. 516,431 891,431 - - - 2004 1,330,000 475,938 1,805,938 - 2005 1,620,000 405,875 , 2,025,875 - - 2006. 1 700,000 320,650 2,020,650 2007 1,800,000 230,700 2,030,700 - - - 2008 1,885,000 142,260 2,027,260 - - 2009 1,980,000 48,510 2,028,510 - 2010 - - - - 2011 - - 2012 - - 2013 - - - - - 2014 - - - 2015 - - - 2016 - - - 2017 - - 2018 - - - Totals $ 10,830,000 $ 3,245,346 $ 14,075,346 $ 49,037 $ 2,498 $ 51,535 Obligations Under Bank One Due During Capital Leases Fiscal Year Principal Interest Due Ending Due March 1, Sept.30, March 1 September 1 Total 2001 $ 55 109 $ 2,159 $ 57,268 2002 - - 2003 2004 - - 2005 - - 2006 - - 2007 - - 2008 - - 2009 - - , 2010 - - 2011 - - 2012 - - 2013 - 2014 - - 2015 - - - 2016 - - 201-7 - - - 2018 - - Totals $ 55,109 $ ` 2,159 $ 57,268 89 CITY OF PEARLAND,TEXAS Exhibit F(2 of 2) SCHEDULE OF GENERAL LONG-TERM DEBT SERVICE REQUIREMENTS TO MATURITY September 30,2000 Certificates of Obligation, Certificates of Obligation, Due During ` Series 1995 $5,000,000 Series 1997 $6,250,000 Fiscal Year Principal Interest Due Principal Interest Due Ending Due March 1, Due March 1, Sept.30, March 1 September 1 Total March 1 September 1 Total 2001 $ 165,000 $ 245,945 $ 410,945 $ 100,000 $ 337 135 $ 437 135 2002 175,000 234,045 409,045 100,000 329,885 429,885 2003 185,000 221,445 406,445 100,000 322,635 422,635 2004 200,000 207,970 407,970 100,000 315,385 415,385 2005 210,000 195,510 405,510 100,000 308,135 408,135 2006 225,000 184,312 409,312 100,000- 300,885 400,885 2007 240,000 172,335 412,335 110,000 293,273 403,273 2008 255,000 159,338 414,338 120,000 285,385 405,385 2009 270,000 145,290 415,290 120,000 278,335 398,335 2010 500,000 124,250 624,250 400,000 264,685 664,685 2011 500,000 96,500 596,500 460,000 242,110 702,110 2012 500,000 68,250 568,250 520,000 216,255 736,255 2013 500,000 39,500 539,500 580,000 186,960 766,960 2014 500,000 12,500 512,500 650,000 153,895 803,895 2015 - 1,210,000 103,373 1,313,373 2016 - 1,280,000 35,200 1,315,200 2017 - - 2018 - - - Totals $- 4,425,000 $ 2,107,190 $ 6,532,190 $ 6,050,000 $ 3,973,531 $ 10,023,531 Certificates of Obligation, Due During . Series 1997A $5,500,000 Fiscal Year Principal Interest Due Ending Due March 1, Sept.30, March 1 September 1 Total 2001 $ 100,000 $ 296,046 $ 396,046 2002 100,000 288,846 388,846 2003 100,000 281,646 381,646 2004 100,000 274,446 374,446 2005 100,000 267,246 367,246 2006 100,000 260,046 360,046 2007 100,000 252,846 352,846 2008 100,000 246,346 346,346 2009 100,000 240,846 340,846 2010 395,000 227,976 622,976 2011' 415,000 206,916 621,916 2012 440,000 184,686 624,686 2013 465,000 161,040 626,040 2014 495,000 135,716 630,716 2015 525,000 108,489 633,489 2016 555,000 79,395 634,395 2017 590,000 48,480 638,480 2018 620,000 16,275 636,275 Totals $ 5,400,000 $ 3,577,287 $ 8,977,287 90 E��5 F1 1 DEBT ENT 91 CITY OF PEARLAND,TEXAS SCHEDULE OF ENTERPRISE FUND DEBT SERVICE REQUIREMENTS TO MATURITY September 30,2000 Water&Sewer System Revenue Bonds Due During Annual Requirements for All Series Series 1996A-$1,115,000 Fiscal Year Total Total Total Principal Interest Due Ending Principal and Principal Interest Due March 1, Sept.30, Interest Due Due Due Sept.1 Septemberl Total 2001 $ 1,963,844 $ 585,000 $ 1,378,844 $ 200,000 $ 20,600 $ 220,600 2002 5,837.903 4 485,000 1,352,903 200,000 10,400 210,400 2003 5,492,990 4,360,000 1132,990 2004 1469,848 540,000 929,848 2005 2,208,186 1,310,000 898,186 2006 2,208,501 1,355,000 853,50I 2007 2,215,949 1410,000 805,949 2008 2,215,596 1460,000 755,596 - 2009 2,221,587 1,520,000 701,587 2010 2,219,903 1,575,000 644,903 2011 2,224,027 1,640,000 584,027 2012 2,223,837 1705,000 518,837 2013 2,220.046 1770,000 450,046 2014- 2,222,465 1,845,000 377 465 - 2015" 2,221,328 1 920,000 301,328 2016 2,216,069 1,995,000 221,069 - 2017 2,211790 2,090,000 121 790 2018 2,201,040 2,160,000 41,040 - Totals $ 45,794,909 $ 33,725,000 $ 12,069,909 $ 400,000 $ 31,000 $ 431,000 Certificates of Obligations Due During Series 1998 $17,100,000 Fiscal Year Principal Interest Due Ending Due March 1, Sept.30, Sept.1 September 1 Total 2001 $ 50,000 $ 595,558 $ 645,558 2002 75,000 593,833 668,833 2003 90,000 591,500 681,500 2004 100,000 588,768 688,768 2005 855.000 574 706 1,429 706 2006 880,000 548,675 1428,675 2007 915,000 521,073 1436.073 2008 945,000 492,006 1437,006 2009 980,000 461197 1 441 197 2010 1,015,000 428,271 1443,271 2011 1,050,000 393,157 1443,157 , 2012 1,090,000 355,697 1445,697 2013 1 125,000 316.100 1 441 100 2014 1 170,000 274 497 1 444 497 2015 1,210,000 230,760 1440,760 2016 1,250,000 184,937 1 434,937 2017 2,090,000 121 790 2,211 790 2018 2,160,000 41,040 2,201,040 Totals $ 17,050,000 $ 7,313,565 $ 24,363,565 92 93 CITY OF PEARLAND,TEXAS Exhibit H-1 COMPONENT UNITS COMBINING BALANCE SHEET September 30,2000 and 1999 Totals P.E.D.C. TIRZ 2000 1999 Assets and Other Debits Assets Cash and cash equivalents $ 3,474,126 $ 68,891 3,543,017 2,794,915 Interest receivable 16,488 - 16,488 13,274 Amount to be provided'for retirement of debt 4,752,620 - 4,752,620 4,842,619 Fixed assets '55,403 - 55,403 31,858 Total Assets $ 8,298,637 $ 68,891 $ 8,367,528 $ 7,682,666 liabilities and Equity Liabilities Accounts payable $ 13,286 $ 21,441 $ 34,727 $ 6,624 Accrued liabilities - - - 5,398 Accrued compensated absences 7,620 - 7,620 7,619 Current portion-revenue bonds 95,000 - 95,000 90,000 General obligation bonds 4,650,000 - 4,650,000 4,745,000 Total Liabilities 4,765,906 21,441 4,787,347 4,854,641 Equity and Other Credits. Investment in General Fixed Assets 55,403 - 55,403 31,858 Undesignated 3,477,328 47,450 3,524,778 2,796,167 Total Equity and Other Credits 3,532,731 47,450 3,580,181 2,828,025 Total Liabilities,Equity, and Other Credits $ 8,298,637 $ 68,891 $ 8,367,528 $ 7,682,666 94 CITY OF PEARLAND,TEXAS Exhibit H-2 COMPONNENTTUNITS COMBINING STATFIVIEN T OF REVENUES,EXPENDITURES,AND CHANGES IN FUND BALANCE Year Ended September 30,2000 with comparative totals for the Year Ended September 30,1999 EDC Totals Fund TIRZ 2000 1999 Revenues Sales Tax Revenue $ 1,841,918 $ $ 1,841,918 $ 1,707,193 Other Revenue 415,199 185,266 600,465 164,706 Total Revenues 2,257,117 185,266 2,442,383 1,871,899 Expenditures Economic Development Current: Personnel $ 178,839 $ - $ 178,839 $ 211,338 Connuliities 4,671 - 4,671 1,415 Contractual services 205,981 - 205,981 242,604 Other services 3,162 139,316 142,478 ' ' 160 Capital Outlay 701,280 - 701,280 2,478,602 Debt Service: Principal 90,000 - 90,000 85,000 Interest and fiscal charges 282,023 - 282,023 288,118 Total Expenditures 1,465,956 139,316 1,605,272. 3,307,237 Revenues Over(Under)Expenditures 791,161 45,950 837,111 (1,435,338) Other Financing Sources(Uses) Operating transfer(out)to primary govemment(General Fund) (110,000) - (110,000) (110,000) Revenues and Other Financing Sources Over(Under Expenditures and Other Financing(Uses) 681,161 45,950 727,111 (1,545,338) Fund Balances-Beginning 2,796,167 1,500 2,797,667 4,341,505 Fluid Balances-Ending $ 3,477,328 $ 47,450 $ 3,524,778 $ 2,796,167 95 CITY OF PEARLAND,TEXAS Exhibit I-1 PEARLAND ECONOMIC DEVELOPMENT CORPORATION(P.E.D.C.) COMBINING BALANCE SHEET September 30,2000 and 1999 .`") EDC EDC Totals EDC Fixed Long Term Fund Overpass Assets Debt 2000 1999 Assets and Other Debits Assets ,Cash and cash equivalents $ 3,263,362 $ 210,764 $ - $ - 3,474,126 2,794,915 Interest receivable 16,488 - - - 16,488 13,274 Amount to be provided for retirement of debt - - - 4,752,620 4,752,620 4,842,619 Fixed assets - - 55,403 - 55,403 31,858 Total Assets $ 3,279,850 $ 210,764 $ 55,403 $ 4,752,620 $ 8,298,637 $ 7,682,666 Liabilities and Equity Liabilities Accounts payable .$ 13,286 $ - $ - $ - $ 13,286 $ 6,624 Accrued liabilities - - - - - 5,398 Accrued compensated absences •- - - 7,620 7,620 7,619 Current portion-revenue bonds - - - 95,000 95,000 90,000 General obligation bonds - - - 4,650,000 4,650,000 4,745,000 Total Liabilities 13,286 - - 4,752,620 4,765,906 4,854,641 Equity Investment in General Fixed Assets - - 55,403 - 55,403 31,858 Undesignated 3,266,564 210,764 - - 3,477,328 2,796,167 3,266,564 210,764 55,403 - 3,532,731 2,828,025 'Total Liabilities and Equity $ 3,279,850 $ 210,764 $ 55,403 $ 4,752,620 $ 8,298,637 $ 7,682,666 96 CITY OF PEARLAND,TEXAS Exhibit I-2 PEARLAND ECONOMIC DEVELOPMENT CORPORATION(P.E.D.C:) COMBINING STATEMENT OF REVENUES,EXPENDITURES,AND CHANGES IN FUND BALANCE Year Ended September 30,2000 with comparative totals for the Year Ended September 30,1999 EEC Totals Fund Overpass 2000 1999 Revenues Sales Tax Revenue $ 1,841,918 $ - $ 1,841,918 $. 1,707,193 Other.Revenue 156,206. 258,993 415,199- , .164,706 Total Revenues 1,998,124 258,993 2,257,117 1,87.1,899 Expenditures Economic Development Current: Personnel 178,839 - 178,839 211,338 Commodities 4,671 - 4,671 1,415 Contractual,services 205,981 - 205;981 242,604 Other services 3,162 - 3,162 160 Capital Outlay 87,901 613,379 701,280 2,478,602 Debt Service: Principal 90,000 90,000 85,000 Interest and fiscal charges 282,023_ - 282,023 288,118 Total Expenditures 852,577 613,379 1,465,956 3,307,237 Revenues Over(Under)Expenditures 1,145,547 (354,386) 791,161 (1,435,338) Other Financing Sources(Uses) Operating transfer(out)to primary govemment(General Fund) (110,000) (110,000) (110,000) Revenues and Other Fmancing Sources Over(Under Expenditures and Other Fmancing(Uses) 1,035,547 (354,386) 681;161 .(1,545,338) Fund Balances-:Beginning 2,231,017 565,150 2,796,167 4,341,505 Fund Balances-Ending $ 3,266,564 $ 210,764 $ 3,477,328 $ 2,796,167 97 CITY OF.PEARLAND,TEXAS Exhibit J-1 TIRZ#1 &#2- COMBINING BALANCE.SHEET September 30,2000 and1999 `7 TIRZ#1 RZ#2 Total Assets and Other Debits Assets Cash and_cash equivalents $ 68,536 '$ 355 $ 68,891 , Total Assets $ 68,536 $ 355 $ 68,891 Liabilities and Equity Liabilities Accounts payable $ $ 21,441 $ 21,441 Total Liabilities - 21,441 21,441 Equity Undesignated 68,536 (21,086) 47,450 Total Liabilities and Equity $ 68,536 $ '355 $ 68,891' 98 CITY OF PEARLAND,TEXAS Exhibit J-2 TIRZ#1 &#2 COMBINING STATEMENT OF REVENUES,EXPENDITURES,AND CHANGES IN FUND BALANCE. Year Ended September 30,2000 TIRZ#1 TIRZ#2 Totals Revenues Other Revenue $ 67,036 $ 118,230 $ 185,266 Total Revenues 67,036 118,230 . 185,266 Expenditures TIRZ Current: Other services - 139,316 139,316 Total Expenditures - 139,316 139,316 Revenues Over Expenditures 67,036 (21,086) 45,950 Fund Balances-Beginning 1,500 - 1,500 Fund Balances(Deficit).-Ending $ 68,536 $ (21,086) $ 47,450 99 (this page intentionally left blank) 100 O SZ NIISTICA1,SECIIpS A3SSATIT 101 CITY OF PEARLAND,TEXAS GENERAL GOVERNMENTAL EXPENDITURES BY FUNCTION(1) Last Ten Fiscal Years Fiscal Year Ended General Public Public Community Sept.30, Government Safety Works Services 1991 1,286,010 2,262,597 1,146,406 378,645 1992 1,591,133 2,467,920 2,293,754 464,376 1993 1,709,983 2,890,899 3,514,225 501,733 1994 1,831,204 3,100,156 3,312,929 777,059 1995 1,998,228 3,445,100 3,798,607 881,211 1996 2,316,013 3,865,449 4,112,939 1,185,426 1997 2,357,621 4,238,647 4,334,123 1,137,045 1998 2,834,021 5,026,554 4,925,693 1,543,440 1999 3,685,523 5,695,956 5,137,708 1,580,624 2000 3,580,693 5,944,516 5,635,397 1,762,770 (1) - Includes general governmental expenditures of the General Fund and Debt Service Fund. 102 Table 1 Debt Service Total 2,360,017 7,433,675 2,361,609 9,178,792 2,547,354 11,164,194 2,254,696 11,276,044 2,044,453 12,167,599 2,430,097 13,909,924 ,2,451,033 14,518,469 3,273,010 17,602,718 3,209,693 19,309,504 3,073,461 19,996,837 103 CITY OF PEARLAND,TEXAS GENERAL GOVERNMENTAL REVENUES BY SOURCE(1) Last Ten Fiscal Years Fiscal Year Property Ended Taxes and Other Licenses Fines and Sept:30, Penalties Taxes(2) and Permits Forfeitures 1991 6,782,700 1,548,190 277,260 257,781 1992 7,722,736 1,704,160 296,725 315,085 1993 8,094,140 1,733,901 418,577 404,857 1994 8,261,631 1,905,741 432,626 415,511 1995 8,568,140 2,166,219 339,309 415,378 1996 9,292,922 2,298,546 514,081 459,884 1997 10,472,362 2,589,918 524,197 529,152 1998 7,108,800 2,973,058 615,808 576,856 1999 8,192,927 3,426,576 955,819 675,691 2000 9,344,578 3,697,523 1,469,799 731,959 (1) - Includes general governmental revenues of the General Fund and Debt Service Fund. (2) - Primarily City Sales taxes. 104 Table 2 Charges Inter- For Franchise governmental Other Services Fees Revenues Revenues Total - 753,493 - 191,434 9,810,858 1,115,488 1,077,130 - 371,742 12,603,066 1 089,194 1,050,451 - 311,959 13,103,079 1,182,274 1,109,374 107,987 463,971 13,879,115 1,425,741' 1,026,007 78,882 809,141 14,828,817 1,553,765 1,016;069 246,414 523,188 15,904,869 1,648,617 1,498,788 197,764 722,189 18,182,987' 2,508,087 1,703,715 345,674 678,232 16,510,230 2,960,214 1,943,545 489,860 692,481 19,337,113 3,061,545 2,022,789 15,000 938,107 21,281,300 105 CITY OF PEARLAND,TEXAS PROPERTY TAX LEVIES AND COLLECTIONS(1) Last Ten Fiscal Years Fiscal Year Percent of Delinquent Ended Total Current Tax Current Taxes Tax Sept.30, Tax Levy(2) Collections Collected Collections 1991 4,604,996 4,524 053. 98.24 $ 87,551 1992 4,943 097 4,832,158 97 76 60,002 1993 5,218,769 5,141,839 98.53 96,234 1994 5;224,050 5,020,687 96 11 1 152 1995 5,316,625 5;229,939' 98.37 63,318 1996 5,869,525 5,790,544 98.65 62,365 1997 6,343,113 6,235,954 98.31 70,983 1998 7,062,826 6,957,153 98.50 74,969 1999 8,147,473 7,992,304 98 10 96,094 2000 9 174,224 9,094,747 99 13 119,461 (1) A property tax system was initiated in the 1970-71 fiscal year Taxes are levied in August(or as,soon thereafter as practicable)and become delinquent on February 1 of each year The City, in accordance with Section 33 07 of the Texas Property Tax Law Annotated 1982,imposes an additional penalty of 15% beginning July 1 to defray cost of collection. (2) - The total tax levy has been adjusted to reflect additions to and deletions from the tax roll for prior years. 106 Table 3 Percent of Percent of Total Tax Outstanding .Delinquent Total Tax Collections to Delinquent Taxes to Collections Total Tax Levy Taxes Total Tax Levy $ 4,611,604 100 14 $ 283,909 6 2 4,892,160 98 97 278,501 5 6 5,238 073 100 37 303,983 5 8 5,021,839 96 13 286,677 5.5 5,293,257 99.56 383,032 7.2 5,852,909 99 72 280,499 4 8 6,306,937 99 43 258,104 4 1 7,032,122 99.57 293,915 4.2 8,088,398 99 27 389,445 4.8' 9,214,208 100 44 479,170 5.2 107 CITY OF PEARLAND,TEXAS Table 4 ASSESSED VALUE OF TAXABLE PROPERTY Last Ten Fiscal Years Fiscal Year Ended Personal Sept. 30, Real Property Property Total 1991 494,085,484 81,539,040 575,624,524 1992 532,082,340 94,804,820 626,887 160 1993 555,963,400 98,841,350 654,804,750 1994 593,577,620 136,752,320 730,329,940 1995 646,643,658 116,800,2'12, 763,443,870 1996 722,600,850 121,756,991 844,357,847 1997 774,645,420 100,838,570 875,483,990 1998 857,952,469 154,096,941 1,012,049,410 1999 998,492,267 173,806,010 1,172,298,277 2000 1,145,678,437 174,353,848 1,320,032,285 Note-Assessment date is January 1st of the tax year Assessed value is 1'00% of the estimated actual value Source-Tax department records of the County 108 CITY OF PEARLAND,TEXAS Table 5 PROPERTY TAX RATES.- DIRECT AND OVERLAPPING GOVERNMENTS(1) Last Ten"Fiscal•Years Pearland Harris Independent Port of County Harris County Fiscal City of School Brazoria 'Hams Houston Flood Hospital Year Pearland District County ,County Authority Control District 1991 0.8000 14752 0.3161 0.3148 0.0133 0.0619 0.1662 1992 0.8000 •1.6000 0.3161 0.3218 0.0153 0.0559 0.1962 1993 0.7970 1.5320 0.3575 0.3290 0.0149 0.0559 0.1962 1994 0.7153 17047 0.3575 0.3385 0.6122 0:0557 0.1897 1995 0.6974 17050, 0.3575 0.3628 0.0132 0.0625 0.1835, 1996 0.6950 1.7050 0.3575 0.4068 0.0160 0.0760 0.1238 1997 0.6950 17685 0.4989 0.4187 0.0156 0.0797 0.1238 1998 0.6950 .17767 0.4989 0.4166 0.0213 0.0800 0.1238 1999 0.6950 1.8624 0.4989 0.3703 0.0204 '0.0308 0.1465 2000 0.6950 1.6500 0.5336 0.3590 0.0183 0.0617 0.2027 Note:Property Tax rates based on per$100 of assessed valuation. 109 CITY OF PEARLAND,TEXAS Table 6 PRINCIPAL TAXPAYERS September 30,2000 1999 Assessed Percentage of Value of Assessed Taxpayer Type of Business Property* Valuation 1 Weatherford International Oil Field Service,Rental& Fishing Operation $ 18,679,380 1 42 % 2 Houston Light& Power Utility Company 12,036 460 0 91 3 Pearland Enclave Apts. Apartment 10,235 020 0 78 4 Southwestern Bell Utility Company 9;374,920 0 71 Telephone Company 5 Weatherford US LP Oil Field 6,574,300 0.50 6 Texas Windmill Apts. Apartment 6,108,210 0 46 7 Continental 34 Fund Ltd. Apartment 6,093,140 0 46 8 Phillips Petroleum Co. Oil Field 6,036,120 0 46 9 Aggreko Inc Mobile Temperature 5,976;480 0 45 10 Whispering Winds Apts Apartment 5,854,140 0.44 Total ten principal taxpayers 86,968,170 6.59 Others 1,233,064,115 93 41 Total $ 1,320,032,285 100.00 % *Source: Tax department records of the County 110 CITY OF PEARLAND,TEXAS Table 7 PROPERTY VALUE, CONSTRUCTION,AND BANK DEPOSITS September 30, 2000 Fiscal Bank Property Year Construction Deposits-A Value- C 1991 $ 36,532,453 $ 181,448,579 $ 575,624,524 1992 40,648,928 175,680,243 617,887,160 1993 47,503,523 190,640,375 654,840,750 1994 50,962,332 194,173,827 730,329,940 1995 44,521,636 * 763,443,870 1996 47,357,024 * 844,357,847 1997 126,940,074 * 912,663,45.0 1998 95,711,203 * 1,020,836,821 1999 106,475,930 * 1,310,608,180 2000 248,015,927 * 1,320,032,285 Note A-•Bank deposits are as reported by Texas Bankers Associations at the preceding December 31 Note B - Inspection department records to'the City Note C -Tax department records of the City * Information.not available 111 CITY OF PEARLAND,TEXAS RATIO OF NET GENERAL LONG-TERM DEBT TO ASSESSED VALUE AND NET'LONG-TERM DEBT PER CAPITA Last Ten Fiscal Years Fiscal Year Net Assessed Gross Ended Estimated Value Long-Term Sept. 30, Population * (in Thousands), Debt(1) 1991 18,750 1,151,496 22,398,598 1992 23;016 1,268,906 23,398,361 1993 23,016 1,329,410 24,385,000 1994 27,942 1,4'11,711 21,765,000 1995 27,942 1,494,202 25,810,000 1996 30,000 1,563,037 24,81'0,000 1997 36,000 1,624,015 35,350,000 1998 37,000 1,012,049 34,820,139 1999 37,535 1,172',298 33,456,209 2000 39 000 1,320,032 29 641,250 (1) - Includes all general obligation bonds,certificates of obligation, and obligations under capital leases at fiscal year end * Source 1989 Houston Lighting and Power connections at 1980 plus new electrical connections (City records) times 3 19 less vacancy rate of 6.3% 1990 Bureau of Statistics 1991-98 Bureau of Statistics plus Houston Lighting and Power connections times 3 19 less'vacancy rate of 6.3% 112 Table 8 Ratio of Net Net Debt Service Net Long-Term Long-Term Monies Long-Term Debt to Debt Available Debt Assessed Value Per Capita 1 586,672 20,811 926 1 81% $ 1,11.0 1,792,917 21,605,444 1 70 939 1,953 703 22,431,297 1 69 975 2,036,915 19 728,085 1 40 706 2,1"73,995 23,636,005 1 58 846 2,435,712 22,374,288 1 43 746 2,141;816 33,208 184 2 04 922 34,820,139 3 44 941 208,324 33,247,885 2 84 886 722,526 28,918,724 2 19 742 113 CITY OF PEARLAND,TEXAS Table 9 RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR GENERAL LONG-TERM DEBT TO TOTAL GENERAL GOVERNMENTAL EXPENDITURES Last Ten Fiscal Years ' Ratio of Fiscal Interest Total Debt Service Year Ended and Fiscal Total Debt General to Total Sept.30 Principal- Agent Fees Service Expenditures(1) , Expenditures 1991 1,157,338 1,202,679 2,360,017 7,433,675 31.75 % 1992 1,000,237 1,361-,372 2,361,609 9,178,792 25.73 1993 1,243,361 1,303,993 2,547,354 11,163,194 22.82 1994 1,100,000 1,154,694 2,254,694 11,267,042 20.01 1995 955,000 1,089,453 2,044,453 12,167,599 16.80 1996 1,010,000 1,420,097 2,430,097 13,909,924 17 47 1997 1,200,000 1,251,033 2,451,033 14,518,469 16.88 1998 1,280,000 1,993,010 3,273,010 17,586,532 18.61 1999 1,440,000 1,769,693 3,209,693 19,309,504 16.62 2000 1,605,000 1,468,461 3,073,461 19,987,414 15.38 (1) - Includes general govenurrntal expenditures of the General Fund and Debt Service Fund. 114 CITY OF PEARLAND,TEXAS Table 10 COMPUTATION OF DIRECT AND OVERLAPPING DEBT September 30,2000 Overlapping Gross TaxOng Jurisdiction Debt. Percentage , Amount Brazoria County $ 28,518,942 5.41 % $. 1,542,875 Harris County 785,659,545 0.05 392,830' Pearland Independent School District 97,836,973 61.77 60,433,898 Port of Houston Authority 296,600,000 0.05 148,300 Harris County Flood Control 150,409,153 0.05. 75,205 Total Overlapping Debt 62,593,107 CITY OF PEARLAND 16,256,250 100.00 16,256,250 Total Direct and Overlapping Debt $ 78,849,357 Population 39,000 - Per Capita Debt-Direct and Overlapping $ 2,021 115 4 CITY OF PEARLAND,TEXAS Table 11 DEMOGRAPHIC STATISTICS Last Ten Fiscal Years Fiscal Year Ended Estimated School Unemployment Sept. 30, Population (1) Enrollment (2) Percentage (3) 1991 18,750 6,950 2 6 % 1992 23,016 7,500 2.5 % 1993 23,0.16 7,555 3.2 % 1994 27,942 8,138 3 8 % 1995 27,942 8,600 3 7 % 1996 30,000 8,900 3 6 % 1997 36,000 9,300 3.9 % 1998 37,000 9,200 4:5 % 1999 37,535 9,500 4.6 % ' 2000 39,000 9,700 3 6 % Sources (1).- Estimated Population- The Pearland Economic Development Corporation (2) - School enrollment figures were obtained from Pearland Independent.School District and includes kindergarten through college students (3) - Unemployment statistics for the City were obtained from the Texas Workforce Commission and calculated as percentage of unemployed to employable 116 CITY OF PEARLAND,TEXAS Table 12' MISCELLANEOUS STATISTICAL DATA Page 1 of 2 September 30,2000 Date of incorporation December 1959 Form of government Council/Manager Area 36 square miles Fire Protection: Number of stations 3 Number of certified personnel,not including reserve firefighters 45 Number of fire vehicles 13 Police Protection: Number of`stations 1 Number of commissioned officers,not including P.S.O.or reserve officers 93 Number of patrol vehicles 74 (home fleet program)- Recreation: Number of parks 8 Acres 110.66 Number of pools 1 Number of tennis courts 9 Softball fields 4 Pavilions 1 large&4 small Community Center 1 Activity Building 1 Frinration: Pearland Independent School District Number of teachers 663 Number of students 10,224 Elementary Schools 7 Middles School 2 Junior High 2 High School 1 117 CITY OF PEARLAND,TEXAS Table 12 MISCELLANEOUS STATISTICAL DATA Page 2 of 2 September 30,2000 City Employees: Full-tine employees 258 Part-tine employees '84 342 Election: Number of votes cast Last general election 1,908 Last city election 6/3/00 Water Number of wells 8 Average daily consumption 5,500,000 gallons Maxirnun daily consun tion 10,000,000 gallons Water mains 180 miles Number of connections 10,780 Sewer Number of plants 3 Liftstations 65 Average daily capacity 7,750,000 gallons Maximum daily consumption 28,000,000 gallons Sanitary sewer mains 170 miles Number of connections 10,200 Emergency Medical Services: Number of volunteers 25 Number of paid paraneclics 34 Number of stations 1 Number of vehicles 8 Library. Number of buildings 1 Number of cardholders 24,000 Number of books in library 84,000 118