HomeMy WebLinkAbout1997 09 30 Annual Comprehensive Financial Report - City of Friendswood I
I
I
I
I Comprehensive
Annual Financial Report
Iof the
City of Friendswood, Texas
I
1
Fiscal Year Ended
September 30, 1997
I
I
IOfficials Issuing Report
IRonald E.Cox
City Manager
I Roger C.Roecker
Director of Administrative Services
I
I
1
I
ICITY OF FRIENDSWOOD,TEXAS
I COMPREHENSIVE ANNUAL FINANCIAL REPORT
Year Ended September 30, 1997
TABLE OF CONTENTS
IExhibit Pa2e
INTRODUCTORY SECTION
I Letter of Transmittal 1
Organization Chart 10
Certificate of Achievement for Excellence in Financial Reporting 11
IPrincipal Officials 12
FINANCIAL SECTION
IIndependent Auditors' Report 13
GENERAL PURPOSE FINANCIAL STATEMENTS
I
Combined Balance Sheet-All Fund Types and Account Groups A-1 14
Combined Statement of Revenues, Expenditures and Changes in Fund
I Balances- All Governmental Fund Types A-2 18
Combined Statement of Revenues, Expenditures and Changes in Fund
Balances — Budget (GAAP Basis) and Actual — General, Special
I Revenue, and Debt Service Funds A-3 20
Combined Statement of Revenues, Expenses and Changes in Retained
Earnings/Fund Balance - Proprietary Fund Type and Non-
I Expendable Trust Fund A-4 22
Combined Statement of Cash Flows - Proprietary Fund Type and Non-
Expendable Trust Fund A-5 24
INotes to Financial Statements A-6 26
COMBINING,INDIVIDUAL FUND AND ACCOUNT GROUP
ISTATEMENTS AND SCHEDULES
Governmental Fund Types
IGeneral Fund:
Comparative Balance Sheet B-1 49
I
Statement of Revenues, Expenditures and Changes in Fund Balance -
Budget and Actual B-2 50
Special Revenue Funds:
1 Combining Balance Sheet C-1 58
Combining Statement of Revenues, Expenditures and Changes in Fund
Balance C-2 60
I Statement of Revenues, Expenditures, and Changes in Fund Balance -
Budget and Actual (Police Investigation) C-3 62
Statement of Revenues, Expenditures, and Changes in Fund Balance -
I Budget and Actual (Fire/EMS Donations) C-4 63
Statement of Revenues, Expenditures, and Changes in Fund Balance -
Budget and Actual (Centennial) C-5 64
I
Ii
CITY OF FRIENDSWOOD, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
Year Ended September 30, 1997
TABLE OF CONTENTS
Exhibit Page I
FINANCIAL SECTION (continued)
COMBINING,INDIVIDUAL FUND AND ACCOUNT GROUP I
STATEMENTS AND SCHEDULES(continued)
Governmental Fund Types (continued) I
Debt Service Fund: ,
Comparative Balance Sheet D-1 65
Statement of Revenues, Expenditures and Changes in Fund Balance -
Budget and Actual D-2 66
Capital Projects Funds: I
Combining Balance Sheet E-1 67
Combining Statement of Revenues, Expenditures and Changes in Fund
Balance E-2 68
Proprietary Fund Type I
Enterprise Fund:
Comparative Balance Sheet F-1 69 '
Schedule of Revenues, Expenses and Changes in Retained Earnings -
Budget and Actual (Non-GAAP Budgetary Basis) F-2 70
Schedule of Bonds Payable by Maturity F-3 73 I
Schedule of Certificates of Obligation by Maturity Date F-4 74
Fiduciary Fund Types I
Trust and Agency Funds: I
Combining Balance Sheet G-1 75
Comparative Statements of Revenues and Changes in Fund Balance G-2 76
Schedule of Changes in Assets and Liabilities G-3 77
Account Groups 1
General Fixed Assets: I
Comparative Schedules of General Fixed Assets by Source H-1 78
Schedule of General Fixed Assets by Function and Activity H-2 79
Schedule of Changes in General Fixed Assets by Function and Activity H-3 81 1
General Long-Term Debt:
Comparative Schedules of General Long-Term Debt I-1 82
Schedule of Changes in General Long-Term Debt I-2 83
Schedule of General Long-Term Debt Service Requirements to I
Maturity I-3 85
ii I
ICITY OF FRIENDSWOOD, TEXAS
I
COMPREHENSIVE ANNUAL FINANCIAL REPORT
Year Ended September 30, 1997
TABLE OF CONTENTS
ITable Pace
UNAUDITED STATISTICAL SECTION
1 General Government Revenues By Source 1 87
General Governmental Expenditures by Function 2 89
I Property Tax Levies and Collections 3 91
Assessed and Estimated Actual Value of Taxable Property 4 93
Direct and overlapping Property Tax Rates 5 94
I
Tax Rate Distribution 6 96
Principal Taxpayers 7 97
Revenue Bond Coverage 8 98
Ratio of Net General Bonded Debt to Assessed Value and Net Bonded
I Debt Per Capita 9 100
Ratio of Annual Debt Service Expenditures for General Bonded Debt to
Total General Expenditures 10 102
I Computation of Direct and Overlapping Debt 11 103
Demographic Statistics 12 104
Property Value and Construction 13 105
I Texas Municipal Retirement System Analysis of Funding Progress- 14 106
Schedule of Impact Fee Project Changes 15 108
Miscellaneous Statistical Data 16 110
I
I
I
I
I
I
I
I
I
1 iii
I
T ,. .
City of Friendswood
.
TEXA
March 31, 1998
I
To the Honorable Mayor and
' Members of the City Council
' The comprehensive annual financial report of the City of Friendswood for the fiscal year ended
September 30, 1997, 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. 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 Single Audit Act is not applicable for fiscal year ended September 30, 1997. There are no major
or nonmajor Federal Financial Assistance programs.
This report includes all funds and account groups of the City. Friendswood Independent School
' District, Clear Creek Independent School District, Galveston County, Harris County, Clear Creek
Drainage District and Friendswood Volunteer Fire Department have not met the established criteria
for inclusion in the reporting entity and, accordingly, are excluded from this report.
The City is involved in two cost sharing projects for the operation of the Blackhawk Regional Waste
Treatment Plant and the Southeast Water Purification Plant with the Gulf Coast Waste Disposal
Authority and the City of Houston, respectively. The City's share of ownership in the Blackhawk
Waste Treatment Plant is 52.47% and paid operating and management fees during the year in the
amount of$919,940. The City's share of production pumping cost in the Southeast Water Purification
1 Plant was 3.75% and paid operating fees in the amount of$346,879 during the year.
The City provides a full range of services, including City administration, traffic planning, inspection
services, municipal court services and a library. However, the services that affect most citizens on a
day-to-day basis are described as follows.
I
I1
3
Water and Sewer
The City provides water and sewer services for residential and commercial locations. 19 employees
are responsible for maintaining the system,as well as billing and collecting for the services.
Police 1
Twenty-four hour coverage is provided by the City's police department, which consists of Administration,
Patrol, Investigative, Communications and Animal Control. A goal of the department's 56 full and part-
time personnel is to actively involve the citizens in its community safety efforts.
Fire
Although the City does not employ its own fire department, it purchases fire trucks and other equipment
for the members of the Friendswood Volunteer Fire Department. The City employs a Fire Marshal,three
part-time deputy fire marshals, one full-time fire fighter, one clerk and funds six fire fighter, paramedic111
and emergency medical technician positions through a pool of part-time employees. The Fire Marshal is
responsible for the emergency management function, as well as fire prevention, education and
investigation duties. I
Streets
The street department is responsible for the repair and maintenance of all city streets and roadside '
drainage. This department consists of twelve employees.
Sanitation
The city's solid waste services, including curbside pickup of recyclable materials, are contracted to a
private firm. Residential pickup is twice weekly. 1
Parks
The Parks and Recreation Division of the Community Services Department oversees 110.5 acres of
parkland, including four tennis courts, a swimming pool, picnic areas and 57.45 acres for future
development. The staff consists of nine full-time employees, as well as part-time and seasonal employees
for the swimming pool, summer camp, sports activities and other park functions.
ECONOMIC CONDITION AND OUTLOOK
The City of Friendswood, Texas, is located 20 miles southeast of downtown Houston in southern Harris
and northern Galveston Counties. The City's population is currently estimated at 28,902. The economy is
linked closely to that of Houston and the Clear Lake area. The Clear Lake Area Economic Development
Foundation (CLAEDF) is charged with retaining current businesses and associated jobs, as well as
recruiting other corporations to the area. Ten companies have either relocated or expanded into the Clear
Lake region in 1996-97.These companies will bring more than 500 new jobs to the Clear Lake area.
The economy of the Clear Lake area has become more diverse, featuring aerospace, petrochemical,
tourism, boating and recreation industries. The NASA/Johnson Space Center, the Bayport petrochemical
complex, Ellington Field and the University of Houston-Clear Lake are key players in the economy of the
area. According to CLAEDF estimates, "726,000 persons are employed within a 45-mile drive time of
the Clear Lake area. The local economic base, comprised of an estimated 7,000 establishments and
95,000 employees, rests solidly on four supports and a bedroom community linkage to Houston. The
first, and most notable, support is the aerospace industry. An equally large and stable second support is
the petrochemical industry. The third and growing component is tourism, and the fourth is the boating
2 1
I
and recreation sector. The region's high-tech work force, strategically located between the Texas Medical
Center and the University of Texas Medical Branch at Galveston, attracts many new bio-technology,
computer software, engineering and petrochemical services companies."
MAJOR INITIATIVES
For the Year.
During the 1996-97 budget preparation, the City identified several important programs needed to meet
citizens' needs for services and to safeguard the environment, in conformity with applicable federal and
state standards. The following items will provide a summary of these programs.
Streets
1996-97 was the thirteenth year of the city's concrete street improvement program. San Joaquin Parkway
was designated as the target for funding at $450,000. In addition, sidewalk projects were budgeted at
$25,000, asphalt street improvements at $50,000 and $6,000 was designated for the City's speed hump
pilot program.
1 Water and Sewer
' The City established its infiltration and inflow program in 1991. Since its inception, 1,106 manholes
were repaired and sealed to reduce the amount of rainwater intrusion. The manhole rehabilitation project
has taken place in 25 subdivisions throughout the City. To continue the program, an additional $125,000
' was included in the 1996-97 budget. Other water and sewer improvements included the following
projects.
1,100 feet of 24" sanitary sewer line was replaced in 1997, with a budget of $75,000. This 11,000'
fiberglass sewer trunk line was installed in 1968 along Cowards Creek and is in poor condition. Because
of the estimated cost of more than $1,000,000 to replace all of this line, the City plans to replace it in
phases, as funding is available.
The fire hydrant painting program is a preventive program to audit, sandblast and paint all fire hydrants in
the City. Since implementation of this program three years ago, 663 fire hydrants have been painted. The
' City budgeted$15,000 to continue this program in 1996-97.
Parks and Recreation
57.45 acres is now available to begin development of the City's new Centennial Park. This property will
be developed into a multipurpose complex that the entire community can enjoy. The new park will
provide a mixture of open space,natural space, recreational facilities and athletic facilities, including: two
playground areas, jogging/walking trail, basketball facilities, soccer and football fields, park pavilions,
concession stand, restrooms and parking. Discussion continues between the City and the Friendswood
Independent School District regarding a possible interlocal agreement, in which a new FISD Jr. High
School would be built on an adjoining 20 acres. The City and School District would then share facilities
and maximize the use of our citizens' tax dollars. $250,000 was budgeted for development purposes.
' Fire
1 Engine number 84 and Rescue 70 were replaced with one fire pumper with the necessary tools and
equipment to also perform the functions of Rescue 70. Placing this new pumper at Fire Station #1 also
allows the relocation of two existing pumpers to provide better fire protection in other parts of the City.
$235,052 was budgeted for this purpose in 1996-97.
t3
3
FOR THE FUTURE
Streets I
An additional $560,754 is budgeted for construction of concrete streets and sidewalks. This funding,
when combined with funds encumbered from 1996-97, will allow the complete reconstruction of San
Joaquin Parkway from FM 528 to San Miguel. Available funding totals approximately$927,000.
Drainage I
$30,000 has been budgeted to improve drainage in the Melody Woods Estates subdivision by constructing
a concrete ditch.
Water and Sewer
$50,000 was budgeted to contract with an engineer to develop a water and sewer analysis of the City's
northern water and sewer infrastructure. Immediate growth is occurring in this area of the City and
capacity must be ensured to allow continued development.
Department Focus.
Each year the City will select a department to highlight for its efforts and accomplishments. For 1996-97
the City Manager's Office has been chosen for review.
Reporting directly to the City Council, the City Manager is ultimately responsible for all City programs.
In addition to the City Manager, the staff consists of two full-time secretaries and a half-time clerical
position filled through the school district's office education program.
This office acts as a focal point for contacts between citizens and City Council and staff. The
responsibilities are wide ranging: provides background information for decision-making of the City
Council; implements decisions and policies of the Council; ensures enforcement of state laws and City
ordinances; directs annual budget preparation and monitors its execution; identifies topics for and
coordinates preparation of Council agendas and publishes two newsletters annually.
The City Manager's Office also coordinates legal assistance as required. The City employs the firm of
Olson & Olson to provide professional legal services; write and review ordinances, resolutions, contracts
and agreements; attend Council meetings; attend Planning and Zoning Commission meetings; review
cable and utility rate regulations and perform other services for the City as requested. Other attorneys and
consultants are also utilized to provide specialized assistance in areas such as cable TV and utility rate
cases.
The City Manager also serves as staff liaison to the Friendswood Community and Economic
Development Committee and the Friendswood Chamber of Commerce. The intent of both of these
bodies is to stimulate economic growth that is compatible with the image of the City of Friendswood.
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 principles. The internal control structure is designed to provide
reasonable,but not absolute,assurance that these objectives are met. The concept of reasonable assurance
4
I
1 recognizes that: (1) the cost of a control should not exceed the benefits likely to be derived; and (2) the
valuation of costs and benefits requires estimates and judgments by management.
IIn 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 City Council.
I The City legally adopts annual budgets for the General, Special Revenue, and Debt Service Funds.
Annual and project budgets are also adopted for the Proprietary and Capital Projects Funds,respectively.
I The level of budgetary control (that is, the level at which expenditures cannot legally exceed the
appropriated amount) is established by department within a fund. The City also maintains an
encumbrance accounting system as one technique of accomplishing budgetary control. Encumbered
Iamounts lapse at year end. However, encumbrances generally are reappropriated as part of the following
year's budget.
As demonstrated by the statements and schedules included in the financial section of this report, the City
Icontinues to meet its responsibility for sound financial management.
I General Government Functions
Revenues for general government functions (General, Special Revenue and Debt Service Funds) totaled
approximately $10.6 million in 1996-97, an increase of approximately $382,000 over 1995-96 revenues.
I The amount of revenue from various sources and the increase (decrease) over the preceding year are
shown in the following tabulation:
Increase
I (Decrease)
Amounts Percent of from 1996
Revenue Source (000's) Total (000's)
IProperty taxes $ 5,747 54.2% $ 86
Sales taxes 1,630 15.4% 191
I Franchise tax 859
1 8.1% 7
Sanitation ,011 9.5% (6)
Fines and forfeitures 348 3.3% (6)
Permits and fees 469 4.4% 67
I
Donations 132 1.2% 4
Intergovernmental 12 0.1% (28)
Earnings on investments 272 2.6% 34
I
Other 127 1.2% 31
$ 10,607 100.0% $ 381
IAssessed valuations of approximately $941 million represented an increase of 3.2 percent over the
preceding year. The net taxable assessed valuations are set at 100% of market value as determined by the
Galveston County and Harris County Appraisal Districts, less exemptions or abatements. For the 1996
I fiscal year, the City's sales tax rate was increased by .5%. The property tax rate for fiscal year 96-97 was
reduced by .0111 per $100 valuation to offset the increase in the sales tax rate. As a result, sales taxes
increased and the adjusted tax levy for the 1996-97 fiscal year of approximately $5.69 million, increased
I by approximately $82,174 or 1.44 percent over the prior year tax levy. Current tax collections of
approximately $5.65 million, or 99 percent of the tax levy, are up approximately $84,263 (1.51%) from
last year. The ratio of total collections (current and delinquent) to the current tax levy was 100.24
I
percent.
5
I
The Cityhad approximately $173,423 in delinquent taxes outstanding as of September 30, 1997 which
represents 3.05 percent of the current tax levy. Delinquent tax collections were down approximately
$38,443 from the prior fiscal year. However, the percentage of delinquent taxes to current levy also
declined by 0.0065 percent.
Allocations of property tax levy for the 1997 fiscal year and the preceding two fiscal years are as follows
(tax rate per $100 of assessed value):
Purpose 1996-97 1995-96 1994-95 111
General Fund $ 0.4961 $ 0.4680 $ 0.5140
General Obligation Debt 0.1084 0.1476 0.1490 I
Total Tax Rate $ 0.6045 $ 0.6156 $ 0.6630
The City's sales taxes increased byapproximately $191,000. This increase is attributable to theprior year
tY PP Y
adoption of an additional .5% sales tax rate and the growth in commercial establishments within the City.
As noted above the property tax revenues decreased as a result of the adoption of additional sales tax to
reduce the property tax rate.
New home and commercial construction remained approximately the same as in prior year with a slight
decline in building permits and fees. Permits and fees decreased by approximately $3,400. The total
amount of new construction for the current fiscal year was approximately $41.5 million, down from $42.4
million for 1995-96, a decrease of.02 percent. 1
Expenditures for general government functions (General, Special Revenue and Debt Service Funds)
totaled approximately $10.6 million in 1996-97, an increase of approximately $483,000 over 1995-96
expenditures. Increases or (decreases) over the preceding year in the levels of expenditures for major
functions of the City are shown in the following tabulation:
Increase
(Decrease) I
Amounts Percent of from 1996
Function (000's) Total (000's)
General government $ 2,129 19.5% $ 513
Public safety 3,846 35.2% 516
Public works 1,861 17.0% 55
Community development 362 3.3% (89)
Community services 1,751 16.0% 64
Debt Service: 974 8.9% (228)
$ 10,923 100.0% $ 831
I
General government expenditures increased by approximately $513,000 due to the City's expending
$348,000 for replacement of the software system and to upgrade the City's computer hardware. The
increases is also due to legal expenditures for utility rate cases and litigation related to a pipeline dispute.
Public safety expenditures increased by approximately $516,000 or 36.4% over the prior year. A portion I
of the increase, $298,000 is due to expenditures related to a search for a kidnapped child and the resulting
murder investigation. $172,000 of the increase is due to the purchase of a fire truck, a vehicle and other
capital equipment in the Fire/EMS department.
6
I
1 Community development expenditures decreased by $89,000 due to the elimination of the City's Planner
position and a temporary vacancy in the Community Development Director position
IDebt Service expenditures decreased by approximately $576,000. The decrease is due to the notes
payable for land purchased for Centennial Park being reduced and a reduction in principal and interest
Ipayments for the year.
Fund balances in the major operating funds were maintained at budgeted levels. Net changes in these
1 fund balances are tabulated below:
(In 000's)
I
Net Ending
Beginning Increase Fund
I Fund Fund Balance (Decrease) Balance
General $ 1,621 $ (479) $ 1,142
Special Revenue 137 (27) 110
I
Debt Service 298 94 392
Capital Projects 779 218 997
IEnterprise Fund Operations
I
The water and sewer utility operation continued to show gains in number of customers. Comparative data
for the past two fiscal years are presented in the following tabulation:
1997 1996
I
(000's) (000's)
Operating revenue $ 4,745 $ 4,995
Operating expenses before depreciation 2,803 2,731 I
Net Revenue Available for Debt Service $ 1,942 $ 2,264
Revenue Bond Debt Service $ 53 $ 55
ICoverage(income available for revenue
bond debt service divided by annual
I
revenue bond debt service) 36.6 41.2
Number of customers
Water 8,701 8,382
1 Sewer 8,350 8,043
I
Non-Expendable Trust Fund Operation
The Non-Expendable Trust Fund is comprised of assets held by the City for the 1776 Park. Activity in
I
this fund resulted solely from interest earnings during the year. Fund balance was $78,102 as of
September 30, 1997.
I
1 7
I
Debt Administration
The ratio of net general obligation debt paid from governmental fund resources 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. At year end, these indicators were as follow:
Percent of 1
Debt to
Assessed Debt Per
Description Amount Value Capita
Net direct bonded debt $ 3,214,207 0.34% $ 111
Overlapping debt 25,253,796 2.68% 874
Total Direct and
Overlapping Debt $ 28,468,003 3.02% $ 985
The City's latest bond issues were rated Aaa by Moody's Investors Service, and AAA by Standard and
Poor's. The City did not have any new debt issuances in fiscal year ending 1997. During the year the
City's debt retirements amounted to $591,897 of General Long Term Debt Group debt and $1,310,950 of
Enterprise Fund debt.
Cash Management
Cash temporarily idle during the year was invested in Texpool, Lone Star Investment Pool (LSIP) and
Local Government Investment Cooperative (LOGIC). Yields on Texpool ranged from 5.22 percent to 5.6
percent during the year ended September 30, 1997, the City earned $59,234 from Texpool. The City's
investments in LSIP earned $65,619. The City's investments in LOGIC earned $43,929. The City also
invested in US governmental securities, T-Bills and Notes. The City earned approximately $170,339 on
these investments. Interest earned for the year was approximately $339,121.
The City's investment policy is to minimize credit and market risks while maintaining a competitive yield 1
on its portfolio. Accordingly, deposits were either insured by federal depository insurance or
collateralized. All collateral on deposits were held by a financial institution's trust department in the
City's name. All investments held by the City during the year end at September 30, 1997 which were
subject to categorization are classified in the category of lowest credit risk as defined by the
Governmental Accounting Standards Board. The investments in Texpool LSIP and LOGIC are not
evidenced by securities that exist in physical or book entry form and accordingly are not subject to credit
risk categorization.
Risk Management 1
The City has a risk management program to protect the City from exposure 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 risk management program encompasses obtaining property and liability insurance
through third party commercial insurance carriers to cover the City for the various risks of loss. I
1
8 ,
1
OTHER INFORMATION
Independent Audit.
The City Charter requires an annual audit of the financial statements of all of the various funds of the City
by independent certified public accountants. The accounting firm of Null Lairson, CPA, P. C. was
selected and their opinion has been included in this report.
1 Awards.
The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for
Excellence in Financial Reporting to the City of Friendswood for its comprehensive annual financial
report for the fiscal year ended September 30, 1996. This was the tenth consecutive year that the City has
received this prestigious award. In order to be awarded a Certificate of Achievement, the City published
an easily readable and efficiently organized comprehensive annual financial report. This report satisfied
' both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
comprehensive annual financial report continues to meet the Certificate of Achievement Program's
requirements and we are submitting it to the GFOA to determine its eligibility for another certificate.
Acknowledgments.
The preparation of the comprehensive annual financial report was made possible by the dedicated service
of the entire staff of the Administrative Services Department. Each member of the department has my
sincere appreciation for the contributions made in the preparation of this report.
In closing, I also express my thanks to the Mayor, members of the City Council and the City Manager for
their leadership, interest and support in conducting the financial operations of the City in a responsible
and progressive manner.
Sincerely,
16;?ee—A--
Roger C. Roecker
Director of Administrative Services
,I
1
1
1
1 9
I
CITY OF FRIENDSWOOD
ORGANIZATION CHART
I
MAYOR 1
AND
COUNCIL
I I I I I I
APOINTED FRIENDSWOOD CITY CITY CITY MUNICIPAL CITY
BOARDS AND VOLUNTEER SECRETARY MANAGER ATTORNEY JUDGE PROSECUTOR
AD HOC FIRE
COMMITTEES DEPARTMENT
I I 1 I I I
ADMINISTRATIVE COMUNITY POLICE FIRE PUBLIC COMMUNITY
SERVICES DEVELOPMENT MARSHAL/ WORKS SERVICES
EMERGENCY
MANAGMENT
I
1
I
1
I
1
I
I
I
1
10 1
Certificate of
i Achievement
for Excellence
in Financial
i Reporting
Presented to
City of Friendswood,
Texas
For its Comprehensive Annual
' Financial Report
for the Fiscal Year Ended
September 30, 1996
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.
0041
rm
President
1 as ait‘
Executive Director
i
i
i11
III
il
y
CITY OF FRIENDSWOOD,TEXAS smi
PRINCIPAL OFFICIALS
IN
September 30, 1997 liki
E
Elected Officials Position Term
Expires
Harold L. Whitaker Mayor May 2000
Kitten Hajecate Council Member—Position No. 1 May 2000
Jerry Erickson Council Member—Position No. 2 May 1999
Tom Manison Council Member—Position No. 3 May 2000
Mel Austin Council Member—Position No. 4 May 1998
I
Aline Dickey Council Member—Position No. 5 May 1999
Mel Measeles Council Member—Position No. 6 May 1998
Appointed Officials Position
Ronald E. Cox City Manager
Deloris McKenzie City Secretary
Jon Branson Director of Community Services
Rebecca Carbone Tax Assessor-Collector
Michel G. Hodge Community Development Director
Melvin L. Meinecke Director of Public Works I
Olson&Olson City Attorney
Terry Byrd Fire Marshall Emergency ManagementI
Coordinator
Roger C. Roecker Director of Administrative Services I
Jared D. Stout Police Chief
James W. Woltz Judge—Municipal Court I
I
I
I
12 I
I
I
I
I
I
I
I
I Fl � T
1
1
1
I
1
I
1
1
1 IlL
11 Green ay Plaza,Suite 1515 Null A LairSO f One Sugar Creek Center Blvd., Suite 1150
1 luuston,"fX 77046 ��V Sugar Land,'I X 77 478
CERTIFIED PUBLIC ACCOUNTANTS
(713)621-151 •Fax:(713)621-1570 (281)242-8600•Fax:(281)242-7333
PROF ESSIONALCORI'OR T ION
1
Independent Auditors' Report
1
To the Honorable Mayor and
Members of the City Council
City of Friendswood, Texas
We have audited the accompanying general-purpose financial statements of the City of Friendswood,
Texas, as of and for the year ended September 30, 1997, 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
e 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 Friendswood, Texas, as of September 30, 1997, and the
' results of its operations and the cash flows of its proprietary fund type and non-expendable trust fund 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, 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 general
purpose financial statements of the City of Friendswood, Texas. 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.
Houston, Texas /
February 13, 1998
I
I
1 13
I
I
I
I
I
I
I
I
I
IGENERAL PURPOSE FINANCIAL STATEMENTS
I
I
I
I
I
I
I
I
CITY OF FRIENDSWOOD,TEXAS
COMBINED BALANCE SHEET-
ALL FUND TYPES AND ACCOUNT GROUPS
September 30, 1997
Governmental Fund Types
Special Debt Capital
General Revenue Service Projects
Assets and Other Debits
Assets
Cash and cash equivalents $ 481,278 $ 56,000 $ $ 1,219,500
Investments 1,528,515 54,225 194,067
Receivables
Taxes 173,423 57,567
Customer accounts 152,506
Interest 31,500 1,200 3,500
Other 197,374
Investments with fiscal agent
Due from other governments 18,443
Due from other funds 201,589
Inventory 10,472
Prepaids and other assets 35,334 2,825
Restricted cash and investments
Fixed Assets: I
General Fixed Assets
Enterprise system property,plant
and equipment at cost,less
accumulated depreciation
Non-expendable trust assets
Other Debits
Amount available for debt service
Amount to be provided for retirement
of general long-term debt
Total Assets and Other Debits $ 2,628,845 $ 111,425 $ 456,723 $ 1,222,325
I
I
See Notes to Financial Statements.
I
14 I
I
1
Exhibit A-1
Page 1 of 2
I
I Proprietary Fiduciary Totals
(Memor
andum Type Fund Type Account Groups Only)
Trust and General General Long- September 30, September 30,
Enterprise Agency Fixed Assets Term Debt 1997 1996
$ 230,21667 $ 20,902 $ $ $ 2,007,896 $ 2,082,235
13 ,11 1,912,924 3,096,161
230,990 231,973
729,345 881,851 840,294
5,916 42,116 58,948
45,551 242,925 45,397
971,877 971,877 729,374
18,443 52,313
I
201,589 125,287
10,472 8,195
62,989 101,148 119,370
I
282,024 282,024 346,026
28,816,843 28,816,843 28,049,373
I25,142,528 25,142,528 24,397,084
57,200 57,200 57,200
I
392,220 392,220 298,053
I3,717,460 3,717,460 4,320,476
$ 26,634,686 $ 1,049,979 $ 28,816,843 $ 4,109,680 $ 65,030,506 $ 64,857,759
I
1
I
I15
I
CITY OF FRIENDSWOOD, TEXAS
COMBINED BALANCE SHEET-
ALL FUND TYPES AND ACCOUNT GROUPS
September 30, 1997
I
Governmental Fund Types
Special Debt Capital
General Revenue Service Projects
Liabilities.Equity.and Other Credits I
Liabilities
Accounts payable $ 382,621 $ 1,427 $ 6,936 $ 23,575
Accrued liabilities 218,615
Compensated absences 600,887
Customer deposits
Deferred revenue 285,085 57,567
Deferred compensation benefits payable
Bonds payable
Certificates of obligation payable
Notes payable
Obligations under capital leases
Due to other funds 201,589
Accretion on premium compound interest
bonds
Total Liabilities 1,487,208 1,427 64,503 225,164
Equity and Other Credits I
Investment in general fixed assets
Contributed capital
Retained earningsII
Fund Balances
Reserved for encumbrances 31,928 140,650
Reserved for inventory 10,472
Reserved for debt services 392,220
Reserved for prepaids and other 35,334
Unreserved:
Designated 950,000 109,998 856,511
Undesignated 113,903 I
Total Equity and Other Credits 1,141,637 109,998 392,220 997,161
Total Liabilities,Equity,and 1
Other Credits $ 2,628,845 $ 111,425 $ 456,723 $ 1,222,325
See Notes to Financial Statements.
16 1
I
1 Exhibit A-1
Page 2 of 2
I
I
Proprietary Fiduciary Totals
I Fund Type Fund Type Account Groups (Memorandum Only)
Trust and General General Long- September 30, September 30,
Enterprise Agency Fixed Assets Term Debt 1997 1996
I
I $ 240,135 $ $ $ $ 654,694 $ 688,364
251,501 470,116 284,906
1 71,914 18,742 672,801 757,675
18,742 171,055
342,652 354,700
971,877 971,877 729,374
4,044,351 1,536,427 5,580,778 6,760,778
5,740,000 2,070,000 7,810,000 8,270,000
181,805 I
180,418 180,418 219,209
201,589 125,287
I264,135 322,835 586,970 512,796
10,630,778 971,877 4,109,680 17,490,637 19,055,949
28,816,843 28,816,843 28,049,373
12,435,358 12,435,358 11,761,849
I3,568,550 3,568,550 3,074,202
67,200 239,778 357,036
8,195
392,220 298,053
I
35,334 44,715
10,902 1,927,411 1,602,655
1 113,903 605,732
16,003,908 78,102 28,816,843 47,539,869 45,801,810
1 $ 26,634,686 $ 1,049,979 $ 28,816,843 $ 4,109,680 $ 65,030,506 $ 64,857,759
I
1 17
CITY OF FRIENDSWOOD, TEXAS
COMBINED STATEMENT OF REVENUES,EXPENDITURES,AND
CHANGES IN FUND BALANCES-ALL GOVERNMENTAL FUND TYPES
Year Ended September 30, 1997
Governmental Fund Types
Special Debt Il
General Revenue Service
Revenues
Property taxes $ 4,712,049 $ $ 1,034,757111
Sales taxes 1,629,754
Franchise fees 859,378
Sanitation 1,011,101
Fines and forfeitures 347,670
Permits and fees 469,669
Donations 21,844 110,537
Intergovernmental 11,510
Interest on investments 229,470 9,170 33,311
Other 121,161 6,188
Total Revenues 9,413,606 125,895 1,068,068
Expenditures
Current:
General government 2,129,473
Public safety 3,687,950 158,446
Public works 1,860,928
Community development 362,455
Community services 1,747,013 3,496
Capital outlay
Debt Service: I
Principal retirement 899,000
Interest and fiscal charges 74,901
Total Expenditures 9,787,819 161,942 973,901
Revenues Over(Under)Expenditures (374,213) (36,047) 94,167
Other Financing Sources(Uses
Operating transfers in 100,000 9,000
Operating transfers(out) (616,511)
Proceeds from sale of equipment
Proceeds from issuance of debt 411,376
Total Other Financing
Sources(Uses) (105,135) 9,000
Revenues and Other Financing Sources I
Over(Under)Expenditures
and Other Financing(Uses) (479,348) (27,047) 94,167
Fund balances-Beginning 1,620,985 137,045 298,053
Fund Balances-Ending $ 1,141,637 $ 109,998 $ 392,220
See Notes to Financial Statements.
I
18
I
I
Exhibit A-2
I
Totals
I
Capital (Memorandum Only)
September 30, September 30,
Projects 1997 1996
Is $ 5,746,806 $ 5,660,697
1,629,754 1,439,030
859,378 852,091
I
1,011,101 347,670 1,017,028
353,742
469,669 401,720
I
132,381 130,309
11,510 49,239
5,953 277,904 279,121
I
1,600 128,949 156,804
7,553 10,615,122 10,339,781
I2,129,473 1,615,770
3,846,396 3,329,960
I
1,860,928 362,455 1,805,947
450,916
1,750,509 1,686,909
504,491 504,491 912,833
I899,000 963,272
74,901 238,920
I
504,491 11,428,153 11,004,527
(496,938) (813,031) (664,746)
1 715,163 824,163 676,185
(616,511) (60,663)
9,600
1 411,376 160,000
715,163 619,028 785,122
I
218,225 (194,003) 120,376
I778,936 2,835,019 2,714,643
$ 997,161 $ 2,641,016 $ 2,835,019
1
I
I
19
I
CITY OF FRIENDSWOOD, TEXAS
COMBINED STATEMENT OF REVENUES,EXPENDITURES,AND
CHANGES IN FUND BALANCES-BUDGET(GAAP BASIS)AND ACTUAL
GENERAL,SPECIAL REVENUE,AND DEBT SERVICE FUNDS
Year Ended September 30, 1997
General Fund I
Variance
Favorable
Budget Actual (Unfavorable)
Revenues
Property taxes $ 4,673,262 $ 4,712,049 $ 38,787
Sales taxes 1,658,840 1,629,754 (29,086)
Franchise fees 703,300 859,378 156,078
Sanitation 994,216 1,011,101 16,885
Fines and forfeitures 313,600 347,670 34,070
Permits and fees 431,848 469,669 37,821
Donations 17,893 21,844 3,951
Intergovernmental 14,280 11,510 (2,770)
Interest on investments 179,400 229,470 50,070
Other 83,900 121,161 37,261
Total Revenues 9,070,539 9,413,606 343,067
Expenditures
Current:
General government 2,239,170 2,129,473 109,697
Public safety 3,630,549 3,687,950 (57,401)
Public works 1,919,963 1,860,928 59,035
Community development 412,560 362,455 50,105
Community services 1,858,302 1,747,013 111,289
Debt Service:
Principal retirement I
Interest and fiscal charges
Total Expenditures 10,060,544 9,787,819 272,725
Revenues Over(Under)Expenditures (990,005) (374,213) 615,792 1
Other Financing Sources(Uses)
Operating transfers in 422,176 100,000 (322,176)
Operating transfers(out) (616,511) (616,511)
Proceeds from the sale of equipment
Proceeds from issuance of long-term debt 411,376 411,376 I
Total Other Financing Sources(Uses) 217,041 (105,135) (322,176)
Revenues and Other Financing Sources Over
(Under)Expenditures and Other
Financing(Uses) (772,964) (479,348) 293,616
Fund balances- Beginning 1,620,985 1,620,985
Fund Balances-Ending $ 848,021 $ 1,141,637 $ 293,616
See Notes to Financial Statements.
20 1
I
I
Exhibit A-3
I
ISpecial Revenue Fund Debt Service Fund
Variance Variance
Favorable Favorable
IBudget Actual (Unfavorable) Budget Actual (Unfavorable)
$ $ $ $ 1,021,128 $ 1,034,757 $ 13,629
1
I
125,252 110,537 (14,715)
2,525 9,170 6,645 20,200 33,311 13,111
10,000 6,188 (3,812)
I
137,777 125,895 (11,882) 1,041,328 1,068,068 26,740
I103,969 158,446 (54,477)
III 1,928 3,496 (1,568)
804,293 899,000 (94,707)
194,380 74,901 119,479
105,897 161,942 (56,045) 998,673 973,901 24,772
I31,880 (36,047) (67,927) 42,655 94,167 51,512
I 9,000 9,000
(840) 840
4,600 4,600
1 3,760 9,000 14,440
35,640 (27,047) (62,687) 42,655 94,167 51,512
I137,045 137,045 298,053 298,053
$ 172,685 $ 109,998 $ (62,687) $ 340,708 $ 392,220 $ 51,512
I
I21
3
CITY OF FRIENDS WOOD, TEXAS
COMBINED STATEMENT OF REVENUES,EXPENSES,AND
CHANGES IN RETAINED EARNINGS/FUND BALANCE-
PROPRIETARY FUND TYPE AND NON-EXPENDABLE TRUST FUND I
Year Ended September 30, 1997
Proprietary Fiduciary
I
Fund Type Fund Type
Non-Expendable
Enterprise Trust
I
Operating Revenues
Water charges $ 2,589,842 $
Sewer charges 1,947,140
I
Fees and penalties 140,717
Other 66,858
Interest on investments 734
I
Total Operating Revenues 4,744,557 734
Operating Expenses I
Water operations 850,121
Sewer operations 1,485,596
Operation administration 335,335
1
Finance administration 11,399 3,999
Computer services
Insurance 37,345
Engineering 83,118
Depreciation 780,996
Total Operating Expenses 3,583,910 3,999
I
Operating Income(Loss) 1,160,647 (3,265)
Nonoperating Revenue5(Expenses)
Interest revenue 63,626
Impact fees
Gain on sale of property
Interest expense (522,273)
Total Nonoperating
Revenues(Expenses) (458,647)
Income(Loss)Before Operating Transfers 702,000 (3,265)
Operating Transfers In(0110
Operating transfers in 30,180 I
Operating transfers(out) (237,832)
Net Income(Loss) 494,348 (3,265)
I
Retained earnings/Fund balance-Beginning of Year 3,074,202 81,367
Retained Earnings/Fund Balance-End of Year $ 3,568,550 $ 78,102
1
See Notes to Financial Statements.
22
I
I
IExhibit A-4
I
I Totals
(Memorandum Only)
September 30, September 30,
I1997 1996
$ 2,589,842 $ 2,796,977
I 1,947,140 1,919,924
140,717 114,460
66,858 163,758
I 734 1,428
4,745,291 4,996,547
I850,121 989,535
1,485,596 1,325,931
I 335,335 100,825
15,398 217,535
5,403
I 37,345 42,077
83,118 58,013
780,996 873,217
I3,587,909 3,612,536
1,157,382 1,384,011
I
63,626 124,604
I 241,725
1,317
(522,273) (727,274)
I (458,647) (359,628)
I698,735 1,024,383
I30,180
(237,832) (615,522)
I 491,083 408,861
3,155,569 2,746,708
I $ 3,646,652 $ 3,155,569
I23
I
CITY OF FRIENDSWOOD, TEXAS
COMBINED STATEMENT OF CASH FLOWS-
PROPRIETARY FUND TYPE AND NON-EXPENDABLE TRUST FUND
Year Ended September 30, 1997
Proprietary Fiduciary
Fund Type Fund Type
Non-Expendable
Enterprise Trust
Cash Flows from Operating Activities
Operating Income(Loss) $ 1,160,647 $ (3,265)
Adjustments to Reconcile Operating Income(Loss)to
Net Cash Provided(Used)by Operations
Depreciation and amortization 780,996
(Increase)Decrease in investment earnings (734)
(Increase)Decrease in accounts receivable (77,291)
(Increase)Decrease in due from other funds 81,250
(Increase)Decrease in prepaids and other assets 9,283
Increase in accounts payable and accrued liabilities 106,716
Increase(Decrease)in due to other funds (44,037) 1
(Decrease)in customer deposits (152,313)
(Decrease)in compensated absences (2,664)
Net Cash Provided(Used)by Operating Activities 1,862,587 (3,999)
Cash Flows from Noncapital Financing Activities
Operating transfers in 30,180
Operating transfers(out) (237,832) III
Net Cash(Used)by Noncapital Financing Activities (207,652)
Cash Flows from Capital and Related Financing
Activities
Contributed capital 339,466
Impact fees
Capital expenditures for property,plant, and equipment (1,159,020)
Proceeds from the sale of equipment
Principal payments on long-term debt (1,310,950)
Interest payments on long-term debt (522,273)
Net Cash(Used)by Capital and Related Financing Activities (2,652,777)
Cash Flows from Investing Activities I
Purchase of investments
Proceeds from sale of investments 540,577 14,701
increase in joint venture (3,278)
Interest on investments 63,626 407
Net Cash(Used)by Investing Activities 600,925 15,108
Net Increase(Decrease)in Cash and Cash Equivalents (396,917) 11,109
Cash and cash equivalents,beginning of year 714,116 9,208
Cash and Cash Equivalents,End of Year $ 317,199 $ 20,902
Unrestricted cash and cash equivalents $ 230,216 $ 20,902
Restricted cash and cash equivalents 86,983
Cash and Cash Equivalents,End of Year $ 317,199 $ 20,902
24
I
1
Exhibit A-5
I
Totals
I
(Memorandum Only)
1996 1996
1 $ 1,157,382 $ 1,384,011
I
780,996 873,217
(77,291) 54,184
I
81,250 (81,250)
9,283 18,254
106,716 74,495
1 (44,037) 44,037
(152,313) (13,468)
(2,664) (8,743)
I1,859,322 2,344,737
I
(237,832) (615,522)
(237,832) (615,522)
I
339,466
I
241,725
(1,159,020) (1,234,320)
1,317
I
(1,310,950) (898,400)
(522,273) (661,133)
(2,652,777) (2,550,811)
1 (688,259)
555,278
I
(3,278) (12,126)
64,033 124,277
616,033 (576,108)
I
(415,254) (1,397,704)
723,324 2,121,028
I $ 338,101 $ 723,324
$ 251,118 $ 569,061
86,983 154,263
I
$ 338,101 $ 723,324
1 25
CITY OF FRIENDSWOOD
Exhibit A-6
I
NOTES TO FINANCIAL STATEMENTS
INOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
I The City of Friendswood, Texas(the City)was incorporated on October 15, 1960. The City charter provides for a City
Council-City Manager form of government. The Mayor and six Council Members are elected from the City at large
serving three year terms. Currently, the City charter provides for a Council term limitation of three terms.
IThe City Council is the principal legislative body of the City. The City Manager is appointed by a majority vote of the
City Council and is responsible to the Council for the administration of all the affair of the City. The City Manager is
I responsible for law enforcement, appointment and removal of department directors and employees, supervision and
control of all City departments, and preparation of the annual budget. The Mayor presides at meetings of the City
Council and can vote.
I The City provides the following services: public safety, streets, parks and recreation, library, water and sewer,
sanitation,planning and zoning,building inspection,code enforcement,and general administrative services.
IA. Reporting Entity
I The City is an independent political subdivision of the State of Texas governed by an elected six member council
and a mayor 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
I inclusion of other entities, organizations, or functions as part of the City's financial reporting entity. Based on these
considerations, no other entities have been included in the City's reporting entity. Additionally, as the City is
considered a primary government for financial reporting purposes, its activities are not considered a part of any
Iother governmental or other type of reporting entity.
Considerations regarding the potential for inclusion of other entities, organizations, or functions in the City's
Ifinancial 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;
I 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
I 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.
IAs indicated in Note 13, the City participates in a joint venture (Blackhawk Regional Waste Treatment Plant) with
three other entities, under the authority of the Gulf Coast Waste Disposal Authority. This venture is accounted for
I
under the equity method in the City's Enterprise Fund.
I
I
I
26
I
CITY OF FRIENDSWOOD
NOTES TO FINANCIAL STATEMENTS Exhibit A-6
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
B. Fund Accounting
The accounts of the City are organized on the basis of funds or account groups, each of which is considered to be a
separate accounting entity. The operations of each fund are accounted for by providing a set of self-balancing
accounts which consist of each fund's assets, liabilities, fund equity, revenues, and expenditures or expenses, as
appropriate. The following paragraphs describe the various fund types and account groups.
Governmental Fund Types
General Fund(Budgeted)
The General Fund accounts for the resources used to finance all the operations of the City not properly included
in other funds. The principal sources of revenue of the General Fund include property taxes, sales and use taxes,
franchise taxes, fines and forfeitures, permits and fees, and charges for sanitation services. Expenditures include
general government,public safety,public works, community development, and community services.
Special Revenue Funds (Budgeted) I
The Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally
restricted or designated for specified activities. I
Debt Service Fund(Budgeted)
The Debt Service Fund is used to account for the accumulation of resources for the retirement of general long-
term debt and related costs. The primary source of revenue of the Debt Service Fund is property taxes.
Capital Projects Funds (Unbudgeted)
The Capital Projects Funds are used to account for the financial resources to be used for the acquisition or
construction of major capital facilities financed principally by proceeds of long-term debt. Capital Project
Funds are budgeted on a project rather than an annual basis.
Proprietary Fund Type(Unbudgeted)
Enterprise Fund I
The Enterprise Fund is used to account for the operations that provide water and wastewater utility services to
the public. These services are financed and operated in a manner similar to private business enterprises where
the intent of the Council is that costs (expenses, including depreciation) of providing goods or services to the
general public on a continuing basis will be financed or recovered primarily through user charges. Proprietary
fund types follow generally accepted accounting principles prescribed by the Governmental Accounting 111
Standards Board (the GASB), and all Financial Accounting Standards Board's standards issued before ll
November 30, 1989. After this date, the City accounts for its proprietary funds as presented by the GASB.
I
I
I
27 1
1
CITY OF FRIENDSWOOD
Exhibit A-6
I NOTES TO FINANCIAL STATEMENTS
1 NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(continued)
B. Fund Accounting(continued)
Fiduciary Fund Types(Unbudgeted)
' Trust Fund
The Non-Expendable Trust Fund (1776 Park) is used to account for assets held by the City in a trustee capacity
or as an agent for individuals, private organizations, other governments and/or other funds. This fund is
' accounted for on the same basis as proprietary funds.
Agency Fund
' The Agency Fund(Deferred Compensation Fund)is used to account for assets held for employees in accordance
with the provisions of Internal Revenue Code Section 457. The Agency Fund is custodial in nature (assets equal
liabilities) and does not involve measurement of results of operations.
' Account Groups
' General Fixed Assets
The General Fixed Assets Account Group is used to account for the City's land, buildings, improvements, and
equipment, except those recorded in proprietary and fiduciary fund types.
General Long-Term Debt
This account group is used to account for the City's liability for general obligation bonds, certificates of
obligation, notes payable, and capital leases which are payable from governmental fund resources. The debt is
offset by the amount available in the Debt Service Fund and the amount to be provided in future years.
iC. Basis of Accounting
' The basis of accounting is the method by which revenues and expenditures or expenses are recognized lin the
accounts and reported in the financial statements. The accounting and financial reporting treatment applied to a
fund is determined by its measurement focus. All Governmental Fund Types are accounted for using a current
financial resources measurement focus. With this measurement focus, only current assets and current liabilities
' generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues
and other financing sources)and decreases (i.e., expenditures and other financing uses) in net current assets.
The Proprietary Fund Type and the Non-expendable Trust Fund are accounted for on a flow of economic resources
measurement focus. With this measurement focus, all assets and liabilities associated with the operation of this
fund are included on the balance sheet. Fund equity (i.e.,net total assets) is segregated into contributed capital and
retained earnings components. Operating statements for these funds present increases(i.e., revenues) and decreases
(e.g., expenses) in net total assets.
28
CITY OF FRIENDSWOOD
Exhibit A-6
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
C. Basis of Accounting(continued)
The modified accrual basis of accounting is used by the Governmental Fund Types and Agency Fund. Under the I
modified accrual basis of accounting, revenues are recognized when susceptible to accrual, i.e., 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.
Most types of revenue are recorded as revenues when received in cash because they are generally not measurable
until actually received. Revenues susceptible to accrual are property taxes, franchise taxes, sales taxes, licenses,
interest revenues, and charges for services. Property taxes, sales taxes, and franchise taxes collected after the fiscal
year end which should be available to finance current operations are immaterial and remain deferred. Fines and
permits are not susceptible to accrual because generally they are not measurable until received. Investment •
earnings are recorded as earned since they are measurable and available.
Under the modified accrual basis of accounting, expenditures (including capital outlay) are recorded when the
liability is incurred, except for general obligation debt principal and interest which are recorded when paid rather I
than when incurred.
The Proprietary Fund Type and Non-expendable Trust Fund are accounted for using the accrual basis of I
accounting, whereby revenues are recognized in the period in which they are earned and expenses are recognized in
the period in which they are incurred.
1
D. Budgets
Procedures in establishing budgetary data reflected in the financial statements are as follows: I
1. On or before the first day of August of each year, the City Manager shall submit to the Council a proposed
budget and an accompanying message. The Council shall review the proposed budget and revise as deemed
appropriate prior to general circulation for public hearing. The Council shall adopt the budget by ordinance on
one reading on or before the 15th day of September or as soon thereafter as practical. Adoption of the budget
shall require an affirmative vote of at least a majority of all members of the Council. Adoption of the budget
shall constitute appropriations of the amounts specified therein as expenditures from the funds indicated. If,
during the fiscal year, the City Manager certifies that there are funds available for appropriation, revenues in
excess of those estimated in the budget, the Council may make supplemental appropriation for the year up to I
the amount of such excess.
2. At any time during the fiscal year, the City Manager may transfer part or all of any unencumbered
appropriation balance among programs within a department, division, or office, and, upon written request by •
the City Manager, the Council may by ordinance transfer part or all of any unencumbered appropriation
balance from one department,office,or agency to another. 1
3. Limitations: No appropriation for debt service may be reduced or transferred and no appropriation may be
reduced below any amount required by law to be appropriated or by more than the amount of the
unencumbered balance thereof.
I
29
CITY OF FRIENDSWOOD
Exhibit A-6
I NOTES TO FINANCIAL STATEMENTS
NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(continued)
D. Budgets(continued)
4. Lapse of Appropriations: Every appropriation, except an appropriation for a capital expenditure, shall lapse at
the close of the fiscal year to the extent that it has not been expended or encumbered. An appropriation for a
' capital expenditure shall continue in force under the purpose for which it was made until it has been
accomplished or abandoned. The purpose of any such appropriation shall be deemed abandoned if three years
pass without disbursement from or encumbrance of the appropriation.
5. Annual appropriations budgets are adopted for the General, Special Revenue, and Debt Service Funds and are
prepared on a basis consistent with generally accepted accounting principles (GAAP) at the departmental
level,the legal level of budgetary control. An annual non-appropriated budget is adopted for the City's Water
and Sewer Enterprise Fund on a non-GAAP basis for managerial control. Project length budgets are adopted
for Capital Projects Funds and amended on an annual basis to reflect the uncompleted portion of the projects.
' 6. Encumbrances represent commitments related to unperformed contracts for goods or services. Encumbrance
accounting -under which purchase orders, contracts, and other commitments for the expenditure of resources
are recorded to reserve that portion of the applicable appropriation -is utilized in the governmental funds.
' Encumbrances outstanding at year-end are reported as reservations of fund balances and do not constitute
expenditures or liabilities because the commitments will be honored during the subsequent year.
Encumbrances that lapse are reappropriated in the ensuing years budget.
tBudget amendments were adopted for various funds during the year to increase expenditures and other uses. The
amounts reported in the accompanying financial statements represent the original budgeted amounts plus all
supplemental appropriations.
During the 1997 fiscal year, expenditures exceeded appropriations at the departmental level (the legal level of
compliance) in the General Fund and the Centennial Special Revenue Fund — General Government $54,477 and
Community Development by$1,568.
E. Cash and Temporary Investments
All investments are stated at cost, which approximates market value except for assets in a deferred compensation
plan, which are stated at market value. The City holds all investments until maturity date.
The City maintains a pooled cash and investments account for all funds of the City. Each fund's positive equity in
the pooled cash account is presented as "Cash and Cash Equivalents" in the financial statements. Negative equity
balances have been reclassified and are reflected as interfund accounts payable. Interest income and interest
expense are allocated to each respective individual fund monthly based on their respective fund balances.
I For the purpose of the Statement of Cash Flows, all highly liquid temporary investments and investments with a
maturity of three months or less when purchased are considered to be cash equivalents.
I
I
30
CITY OF FRIENDSWOOD
Exhibit A-6 in
NOTES TO FINANCIAL STATEMENTS
NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
F. Interfund Transactions
Interfund transactions that would be treated as revenues, expenditures, or expenses if they involved organizations I
external to the governmental unit are accounted for as revenues, expenditures, or expenses in the funds involved.
Transactions which constitute reimbursements of a fund for expenditures or expenses initially made from that fund
which are properly attributable to another fund are recorded as expenditures or expenses in the reimbursing fund
and primarily as reductions of the expenditure or expense in the fund that is reimbursed.
Non-recurring or non-routine transfers of equity between funds are reported as additions to or reductions of the I
fund balance of Governmental Funds. Transfers of equity to the Enterprise Fund are treated as contributed capital,
and such transfers from the Enterprise Fund are reported as reductions of retained earnings or contributed capital, as
is appropriate in the circumstances. All other legally authorized transfers are treated as operating transfers and are
included in the results of operations of both the Governmental and Proprietary Fund Types.
G. Fund Equity I
Contributed capital is recorded in the Enterprise Fund which has received capital grants, contributions from 1
developers and customers, and/or other funds of the City. Reserved fund balances represent those portions of fund li
balance not appropriable for expenditure or legally segregated for a specific future use. Designated fund balances
represent management's tentative plans for future use of financial resources.
H. Compensated Employee Absences
The City's employees earn vacation and sick leave which may either be taken or accumulated, up to certain
amounts, until paid upon termination or retirement.
The City accrues vacations and sick leave based on criteria established by the Governmental Accounting Standards I
Board. For all funds, this liability reflects amounts attributable to cumulative employee services previously
rendered, where the payment is probable and can be reasonably estimated. The liability for accumulated vacation
and sick leave, as of September 30, 1997, has been recorded in the General and Enterprise Funds since the liability I
is to be liquidated with expendable available resources.
I. Encumbrances I
Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of
funds are recorded in the accounting system in order to reserve the portion of the applicable appropriation, is
employed in the governmental funds. Appropriations lapse at fiscal year-end. Encumbrances that have not been
liquidated are reported as reservations of fund balances since they do not constitute expenditures or liabilities.
I
J. Inventories
Inventories are recorded in the General and Enterprise Funds and are stated at cost, using the first-in, first-out 1
method. Inventories consist of expendable supplies held for consumption, and the cost thereof is recorded as an
expense/expenditure at the time the inventory items are issued(Consumption method).
31 I
CITY OF FRIENDSWOOD
Exhibit A-6
INOTES TO FINANCIAL STATEMENTS
INOTE 1 —SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(CONTINUED)
K. Fixed Assets
General Fixed Assets
General fixed assets have been acquired or constructed for general governmental purposes. Such fixed assets are
recorded as expenditures in the Governmental Funds and capitalized at historical cost in the General Fixed Assets
Account Group. Gifts or contributions of general fixed assets are recorded at estimated fair market value upon
receipt. Public domain ("infrastructure") general fixed assets consisting of certain improvements other than
buildings, including roads,bridges, curbs and gutters, streets and sidewalks, drainage systems, and lighting systems
are capitalized as general fixed assets. No depreciation has been provided on general fixed assets.
Enterprise Fund Fixed Assets
The land, buildings, and equipment owned by the Enterprise Fund are recorded at historical cost or at estimated fair
market value for contributed assets. Interest costs during construction are capitalized when the effects of
capitalization materially impact the financial statements. Some of the assets on which such interest was capitalized
1 are still under construction and are classified as construction in progress in the Enterprise Fund. Depreciation of
buildings and equipment is provided using the straight-line method over the following estimated useful lives:
Years
Water and sewer system 40-50
Equipment 5-10
Additions to the water and sewer systems are financed principally from sources other than Enterprise Fund
operating revenues such as long-term debt and contributed capital. The costs of normal maintenance and repairs are
charged to operations as incurred. Improvements and betterments that extend the useful lives of the assets are
capitalized.
L. Total Columns on Combined Statements
Total columns presented in the combined financial statements are captioned (Memorandum Only) to indicate that
they are presented only to facilitate financial analysis. Data in these columns do not represent financial position,
results of operations, or cash flows on a consolidated basis in conformity with generally accepted accounting
principles. Interfund eliminations have not been made in the aggregation of this data. Certain reclassifications
have been made to the prior year totals to conform with the current year presentation.
M. Estimates
The preparation of financial statements in conformity with generally accepted accounting principles 'requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of financial statements an the reported amounts of revenues
and expenditures during the reporting period.Actual results could differ from those estimates.
I
I
1 32
CITY OF FRIENDSWOOD
Exhibit A-6
NOTES TO FINANCIAL STATEMENTS
NOTE 2 -CASH AND INVESTMENTS
Cash
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 a state-managed public funds investment pool account(Texpool,), a privately-managed public funds
investment pool (Lone Star) and a Local Government Investment Cooperative (LOGIC). The Investments, which
have a maturity at purchase of greater than three months, consist mainly of US government treasury bills, treasury
notes and other US government obligations. The restricted cash and investments are the assets restricted for
specific use. The restricted cash includes cash on deposit with financial institutions and Texpool. At year-end, cash
and cash equivalents consisted of:
Carrying Market
Amount Value 1
Cash on hand and deposits $ 10,357 $ 10,357
Texpool 873,494 873,494
LOGIC 616,006 616,006
Lone Star Investment Pool 595,022 595,022
Total cash and cash equivalents 2,094,879 2,094,879 1
Less restricted cash and cash equivalents 86,983 86,983
Unrestricted cash and cash equivalents $ 2,007,896 $ 2,007,896 1
Credit Risk Categorization for Deposits
Cash deposits held at financial institutions can be categorized according to three levels of risk. These three levels of
risk are:
Category 1- Deposits which are insured or collateralized with securities held by the City or by its agent in the 1
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 securities held by the pledging I
financial institution or by its trust department or agent but not in the City's name.
At September 30, 1997, all of the City's cash deposits were insured or collateralized as described under category 1
above.
The TexPool, Lone Star and LOGIC amounts of$873,495, $595,022 and$734,079, respectively, are not evidenced 1
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 purchase investments authorized by the Public Funds Investment
Act of 1995. The primary objective of these investment pools is to provide a safe environment for the placement of 1
public funds in short-term, fully collateralized investments.
I
33
CITY OF FRIENDSWOOD
Exhibit A-6
INOTES TO FINANCIAL STATEMENTS
INOTE 2—CASH AND INVESTMENTS (continued)
Investments
1 Under provisions of state and local statutes, the City's investment policies, and provisions of the City's depository
contracts with an area financial institution, the City is authorized to place available deposits and investments in the
following:
1. Obligations of the U.S., its agencies and instrumentalities,
1 2. Certificates of Deposit issued by state and national banks or savings or loan associations domiciled in this state
that are:
-guaranteed or insured by the Federal Deposit Insurance Corporation; or
-collateralized in accordance with Section 2256.010,the Texas Government Code, in face amount not to exceed
$100,000,
1 3. No-load money market mutual funds,
4. Texas Local Government Investment Pool, Lone Star Investment Pool, and the Local Government Investment
Cooperative(LOGIC).
City council has adopted a written investment policy regarding the investments of its funds as defined by the Public
Funds Investment Act of 1995 (Chapter 2256, Texas Government Code). The Investments of the City are in
compliance with the council's investment policies. The City did not have any derivative investment products during
the current year. All significant legal and contractual provisions for investments were complied with during the
1 year. Investments at year end are representative of the types of investments maintained by the City during the year.
The carrying amounts and market values of the City's investments can be categorized according to three levels of
risk. These credit risk categories are as follows:
Category 1- Insured or registered, or securities held by the entity or its agent in the entity's name,
Category 2- Uninsured and unregistered, with securities held by the counter-party's trust department or agent
in the entity's name,
Category 3- Uninsured and unregistered, with securities held by counter-party or by its trust department or
agent but not in the entity's name.
1 At year-end, the City's investment balances were as follows:
Carrying Market
iU.S. Government Securities Category Amount Value
■ FNMA term notes 1 $ 1,912,924 $ 1,912,924
Investments not subject to categorization:
Deferred compensation mutual fund 971,877 971,877
1 Total Investments $ 2,884,801 $ 2,884,801
34
I
CITY OF FRIENDSWOOD
Exhibit A-6
NOTES TO FINANCIAL STATEMENTS
NOTE 3 -PROPERTY TAXES I
The City's property taxes are levied annually in October on the basis of the Appraisal District's assessed values as of
January 1 of that calendar year. Appraised values are established by the Appraisal District at market value and i
assessed at 100% of appraised value. The City's property taxes are billed and collected by the City's Tax
Assessor/Collector. Such taxes are applicable to the fiscal year in which they are levied and become delinquent with
an enforceable lien on property on February 1 of the subsequent calendar year.
Property taxes are prorated between operations and debt service based on rates adopted for the year of the levy. For
the current year, the City levied property taxes of$.6045 per $100 of assessed valuation which were prorated between
operations and debt service in the amounts of$.4961 and $.1084, respectively. The resulting adjusted tax levies were ,
approximately $4.6 and $1 million for operations and debt service, respectively, based on a total adjusted taxable
valuation of approximately $941 million for the 1996 tax year.
Property taxes receivable, at September 30, 1997, consists of the following:
Debt I
General Service
Tax Year Fund Fund Total
1996 $ 45,590 $ 9,961 $ 55,551 I
1995 40,464 12,762 53,226
1994 23,338 6,765 30,103
1993 14,042 4,485 18,527
1992 13,604 4,377 17,981
1991 8,849 3,234 12,083
990 and prior 73,126 25,944 99,070
$ 173,423 $ 57,567 $ 230,990
I
NOTE 4- LAND, BUILDINGS,AND EQUIPMENT
A summary of changes in the General Fixed Assets Account Group, for the year ended September 30, 1997, follows: I
Transfers,
Balance, Adjustments Balance,
October 1, and Retirements September 30,
1996 Additions In(Out) 1997
Land $ 3,164,182 $ 168,681 $ $ 3,332,864
Buildings 4,362,738 170,567 4,533,305
Improvements other
than buildings 16,370,479 114,057 16,484,536
Furniture and equipment 4,111,389 261,428 4,372,817
Construction in progress 40,585 52,736 93,321
Total $ 28,049,373 $ 767,469 $ $ 28,816,843 1
I
35
l
CITY OF FRIENDSWOOD
Exhibit A-6
I NOTES TO FINANCIAL STATEMENTS
INOTE 4- LAND, BUILDINGS,AND EQUIPMENT(continued)
Construction in progress and remaining commitments under related construction contracts for general government
1 construction projects at September 30, 1997 is as follows:
Total in
1 Project Description Progress
Activity Building Renovations $ 4,761
Eagle Lakes Drainage 13,660
Panic Alarm System 1,945
San Joaquin Parkway 72,955
Total $ 93,321
IA summary of Enterprise Fund fixed assets at September 30, 1997, follows:
Land $ 643,097
1 Plant and equipment 17,870,698
Plant and equipment-Blackhawk 14,934,426
Water and sewer lines 1,687,541
35,135,762
Less accumulated depreciation (9,993,234)
' Total $ 25,142,528
The Trust and Agency fund accounts for its own land and improvements in the amount of$57,200.
INOTE 5-LONG-TERM DEBT
1 The City issues a variety of long-term debt instruments in order to acquire and/or construct major capital facilities
and equipment for general government and enterprise fund activities. These instruments include general obligation
bonds, certificates of obligation, revenue bonds, notes payable, and capital leases. These debt obligations are
secured by either future tax revenues, water and sewer system revenues, or liens on property and equipment. Debt
obligations that are intended to be repaid from water and sewer system revenues have been recorded in the City's
Enterprise Fund. All other long-term obligations of the City have been recorded in the General Long-Term Debt
Account Group.
I
1
36
CITY OF FRIENDSWOOD
Exhibit A-6
NOTES TO FINANCIAL STATEMENTS
NOTE 5-LONG-TERM DEBT(continued) I
Bonds Payable and Certificates of Obligation
A summary of the terms of general obligation bonds, combination tax and revenue bonds, and certificates of I
obligation outstanding and their corresponding allocations to the General Long-Term Debt Account Group and the
Enterprise Fund at September 30, 1997 follows:
Series and Original Final Interest Long-Term Enterprise
Issue Amount Maturity Rate(%) Debt FundI
General Obligation Bonds
1986 Refunding BondsI
10,650,777 2004 4.25 7.90 $ 242,427 $
1993 Refunding Bonds
6,555,000 2004 2.25 -4.625 1,260,000 3,780,000
1,502,427 3,780,000
Combination Tax and Revenue I
Certificates of Obligation
1992 Series 5,000,000 2008 5.30-6.75 2,070,000 2,605,000
1995 Series 3,200,000 2010 5.375 -7.375 3,135,000
2,070,000 5,740,000
Revenue Bonds
1969 Series 700,000 1999 5.5- 6.125 34,000 66,000
1979 Series 1,750,000 1996 5.5- 6.125 198,351
34,000 264,351 1
Total Bonds and Certificates of Obligation $ 3,606,427 $ 9,784,351
I
Annual debt service requirements for bonds and certificates of obligation are as follows:
General
Long-Term Enterprise
Fiscal Year Debt Fund
1998 563,831 1,565,987
1999 554,016 1,547,760
2000 807,211 1,296,477
2001 408,361 977,951
2002 441,304 937,868
Thereafter 2,291,050 7,139,402
5,065,773 13,465,445
less interest portion 1,459,346 3,681,094
Total requirements $ 3,606,427 $ 9,784,351
37
1
CITY OF FRIENDSWOOD
Exhibit A-6
INOTES TO FINANCIAL STATEMENTS
INOTE 5-LONG-TERM DEBT(continued)
Accretion on Premium Compound Interest Bonds
IA portion of the bonds sold in the Series 1986 refunding bond issue were premium compound interest bonds. These
obligations have par values of$440,777 and maturity values of$1,305,000. The interest these obligations will be paid
upon maturity in the fiscal years ending September 30, 2000, through 2004. The accreted values of these bonds at
1 September 30, 1997, is approximately $1,027,750 of which $462,488 has been allocated to the Enterprise Fund and
$565,263 has been allocated to the General Long-Term Debt Account Group. Accordingly, accretion on these bonds of
$264,138 and $322,835 has been recorded in the Enterprise Fund and the General Long-Term Debt Account Group,
1 respectively.
I
Obligations Under Capital Leases
The City entered into capital lease agreements in order to purchase management information system equipment for City
Hall and the police and fire departments. Following is a summary of future lease payments due on this equipment:
ILease
Fiscal Year Obligation
I 1998 1999 $ 114,939
80,945
2000 2,200
ITotal 198,084
less interest portion 17,666
I
Obligations under capital leases $ 180,418
I
I
Prior Year Defeasance of Debt
In prior years, the City defeased certain general obligation and revenue bonds by placing the proceeds of the 1986 and
1993 refunding bonds in an irrevocable trust to provide for all future debt service payments on the old bonds.
I
Accordingly, the trust account assets and the liability for the defeased bonds are not included in the City's financial
statements. On September 30, 1997,approximately$7.5 million of bonds outstanding are considered defeased.
I
I
I
1 38
CITY OF FRIENDSWOOD
Exhibit A-6
NOTES TO FINANCIAL STATEMENTS
NOTE 5-LONG-TERM DEBT (continued) 1
Changes in Long-Term Debt I
The following are summaries of long-term debt transactions of the City for the year ended September 30, 1997.
General Long-Term Debt Account Group e
1996 Additions Retirements 1997
General obligation bonds $ 1,786,177 $ $ (283,750) $ 1,502,427
Revenue bonds 49,300 (15,300) 34,000
Certificates of obligation 2,100,000 (30,000) 2,070,000 I
Notes payable 181,805 (181,805)
Obligations under capital
leases 219,209 411,376 (450,167) 180,418
Accreted interest on premium I
compound interest bonds 282,038 40,797 322,835
$ 4,618,529 $ 452,173 $ (961,022) $ 4,109,680
I
Enterprise Fund Long-Term Debt I
1996 Additions Retirements 1997
Revenue bonds $ 294,051 $ $ (29,700) $ 264,351
General obligation bonds 4,631,250 (851,250) 3,780,000
Certificates of obligation 6,170,000 (430,000) 5,740,000III
Accreted interest on premium
compound interest bonds 230,758 33,377 264,135
$ 11,326,059 $ 33,377 $ (1,310,950) $ 10,048,486
1
I
I
I
39 I
1 CITY OF FRIENDSWOOD
Exhibit A-6
NOTES TO FINANCIAL STATEMENTS
INOTE 5-LONG-TERM DEBT(continued)
Summary of Long-Term Debt Requirements
I The annual requirements to amortize all long-term debt outstanding at September 30, 1997, including interest
payments are as follows:
General
I
Fiscal Long-Term Enterprise
Year Debt Fund Total
1998 678,770 1,565,987 2,244,757
I 1999 634,961 1,547,760 2,182,721
2000 809,411 1,296,477 2,105,888
2001 408,361 977,951 1,386,312
I 2002 441,304 937,868 1,379,172
2003 442,039 941,121 1,383,160
2004 445,052 935,744 1,380,796
I
2005 346,320
350,238 873,494 1,219,814
2006 871,064 1,221,302
2007 352,913 867,935 1,220,848
I 2008 354,488 872,488 1,226,976
2009 884,175 884,175
2010 893,381 893,381
$ 5,263,857 $ 13,465,445 $ 18,729,302
I
NOTE 6- FUND EQUITY
Retained Earnings
IA portion of retained earnings in the Enterprise Fund is reserved for the following:
I Water and sewer construction $ 112,091
Debt service 115,924
$ 228,015
IContributed Capital
I The following is a schedule of changes in contributed capital for the Enterprise Fund for the year ended September 30,
1997:
I Contributed capital at beginning of year $ 11,761,849
Additions
Contribution from City 673,509
I
Contributed Capital at End of Year $ 12,435,358
I
40
I
CITY OF FRIENDSWOOD
Exhibit A-6
NOTES TO FINANCIAL STATEMENTS
NOTE 6-FUND EQUITY(continued) I
Fund Balance
Fund Balances in the various Governmental Fund Types are reserved or designated as follows: I
Special Capital
General Revenue Debt Service Projects
Reserved for:
Encumbrances $ 31,928 $ $ 140,650
Inventories 10,472
Prepaids and other assets 35,334
Debt service 392,220 1
Total reserved fund
balance $ 77,734 $ 392,220 $ 140,650
Designated for: 1
Emergency
operations $ 900,000 $ $
Police investigations 6,512
Centennial observance 102,325
Fire/EMS 1,161
Authorized
construction 856,511
Total designated fund
balance $ 900,000 $ 109,998 $ 856,511 1
In the Non-expendable Trust Fund, $67,200 of the fund balance is reserved for an endowment I
NOTE 7-INTERFUND OPERATING TRANSFERS
I
Operating transfers between funds during the 1997 year were as follows:
Operating Operating I
Transfer From Transfer To Amounts
General Fund Special Revenue Fund $ 9,000
General Fund Enterprise Fund 30,180
General Fund Capital Projects Fund 577,331
Enterprise Fund General Fund 100,000
Enterprise Fund Capital Projects Fund 137,832
$ 854,343
I
41 I
CITY OF FRIENDSWOOD
Exhibit A-6
I NOTES TO FINANCIAL STATEMENTS
INOTE 8- INTERFUND RECEIVABLES AND PAYABLES
At September 30, 1997 interfund receivable and payable balances consisted of the following:
I
Due From Due To Amounts
Debt Service Fund Capital Projects Fund $ 201,589
Total Due From(To) $ 201,589
NOTE 9-IMPACT FEES
111 On April 27, 1990, the City, in conformance with the provisions of Senate Bill 336 and House Bill 1786, adopted a
Capital Improvements Plan for Water Supply and Distribution Improvements and for Wastewater Treatment and
Collection Improvements that were needed to serve new developments. An Impact Fee Structure to defray the costs of
these improvements was also adopted.
In recent years, the City has committed funds to the construction of surface water facilities and wastewater capacity
I necessary to provide service to current residents, as well as for projected development within the City. The cost of
water and wastewater capacity that has been constructed to support new growth is reflected in the City Wide impact
fees.
IBased on population growth projections, two areas (Melody Lane and Central Service Area) within the City were
identified for the proposed extension of water distribution and wastewater collection systems and are included in the
impact fee structure. An impact fee was also included to defray the costs of water distribution facilities extended to the
Bay Area Boulevard Service Area under the terms of a contractual agreement with Bay Area Land Company, Ltd.
I The Capital Improvements Plan and Impact Fee structure was amended by City Council on January 7, 1991, to include
an impact fee for sanitary sewer collection system costs serving the area known as Mills, Murphy, and Briarmeadow
Avenue between Sunset Drive and Greenbriar.
111
The following is a summary of the Impact Fees that apply on a City Wide Basis and for each of the designated service
areas. The fees represent the charge for single equivalent service units as defined in the Capital Improvement Plan.
I
I
I
I
I
' 42
CITY OF FRIENDSWOOD
Exhibit A-6
NOTES TO FINANCIAL STATEMENTS
NOTE 9-IMPACT FEES(continued)
Equivalent
Service Unit
City Wide Impact Fees
Surface water facilities $ 685
Wastewater treatment facilities 69
Impact fee study and update study 36
Total City Wide Impact Fee $ 790
Water Distribution Impact Fees
Melody Lane service area $ 854
Bay Area Boulevard service area 294
South Friendswood service area 293
Wastewater Collection Impact Fees
Melody Lane service area $ 450
Mills,Murphy,Briarmeadow Avenue 2,532
South Friendswood Service Area
Area A 378
Area B-1 378
Area B-2 378
Area C 285
Area D 161
Area E-1 784
Area E-2 784
Area E-3 161 1
Area E-4 161
Area F 378
I
The impact fees are deposited into a separate, interest bearing bank account in compliance with the referenced
legislation and transferred to the Enterprise Fund cash account as needed. The impact fees and interest income for
each service area are maintained in separate equity schedules. Interest is applied based on a percentage of the daily
equity balance of each service area.
The portion of City Wide Impact Fees collected for Surface Water Facilities are used to meet the current debt service I
obligations for the 1988 Certificates of Obligations issued to fund the surface water facilities capital improvements.
The remaining City Wide Impact Fees collected for Wastewater Treatment Facilities and Impact fee study and Update
Study are used to fund other water and wastewater system improvements. All Impact Fees collected for specific
service areas are used to fund new capital improvements for those designated areas.
I
t
I
43 1
CITY OF FRIENDSWOOD
Exhibit A-6
I NOTES TO FINANCIAL STATEMENTS
INOTE 10- RETIREMENT PLANS
Plan Description and Provisions
The City provides pension benefits for all of its full-time employees through a non-traditional,joint contributory,
defined contribution plan in the state-wide Texas Municipal Retirement System ("TMRS"), one of over 570
' administered by TMRS,an agent multiple-employer public employee retirement system. It is the opinion of TMRS
management that the plans in TMRS are substantially defined contribution plans, but they have elected to provide
additional voluntary disclosure to help foster a better understanding of some of the non-traditional characteristics of
the plan.
Benefits depend upon the sum of the employee's contributions to the plan, with interest, and the (City-financed
monetary credits, with interest. At the inception of the plan, the City granted monetary credits for service rendered
before the plan began of a theoretical amount equal to two times what would have been contributed by the
employee, with interest, prior to establishment of the plan. Monetary credits for service since initiation of the plan
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 the City matching percent 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 ten or more years of service or with 25 years of service regardless of
age. The plan also provides for death and disability benefits. A member is vested after ten years,but he must leave
his accumulated contributions in the plan. If a member withdraws his own money, he is not entitled to the
employer-financed monetary credits, even if he was vested. 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 6%, and the City's matching percent is currently 150% of that
contribution, both as adopted by the governing body of the City. Under the state law governing TMRS, the City
contribution rate is annually determined by the actuary. 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 City matching percent,
I 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 retirement becomes effective. The prior
I service contribution rate amortizes the unfunded actuarial liability over the remainder of the plan's 25-year
amortization period. When the City periodically adopts updated service credits and increases in annuities, the
increased unfunded actuarial liability is to be amortized over a new 25-year period. Currently, the unfunded
1 actuarial liability is being amortized over the 25-year period that began January 1997. The unit credit actuarial cost
method is used for determining the City contribution rate. Contributions are made monthly by both the employees
and the City. Since the City needs to know its contribution rate in advance to budget for it, there is a one-year lag
between the actuarial valuation that is the basis for the rate and the calendar year when the rate goes into effect.
I44
I
CITY OF FRIENDSWOOD
Exhibit A-6
NOTES TO FINANCIAL STATEMENTS
NOTE 10-RETIREMENT PLANS(continued)
The City's total payroll in fiscal year 1997 was approximately $4.7 million and the City's contributions were based
on a payroll of approximately $4.5 million. Both the City and the covered employees made the required ,
contributions that amounted to $324,151 for the City and $267,350 for the employees. The City's contribution is
broken down as follows:
For the months in calendar year 1996 - 6.97% ($74,447) of covered payroll; 6.16% ($65,796) normal cost plus I
0.81%($8,652)to amortize the unfunded actuarial liability.
For the months in calendar year 1997 - 7.37% ($249,675) of covered payroll; 6.34% ($214,718) normal cost 1
plus 1.03% ($34,894)to amortize the unfunded actuarial liability.
The Cityadopted changes in theplan after the previous actuarial valuation, which had the effect of increasing the
P g
City's contribution rate for 1997 by 0.03% of payroll. There were no related-party transactions.
Funding Status and Progress
Even though the substance of the City's plan is not to provide a defined benefit in some form, some additional I
voluntary disclosure is appropriate due to the non-traditional nature of the defined contribution plan which had an
initial unfunded pension benefit obligation due to the monetary credits granted by the City for services rendered
before the plan began and which can have additions to the unfunded pension benefit obligation through the periodic
adoption of increases in benefit credits and benefits. Statement No. 5 of the Governmental Accounting Standards
Board (GASB 5) defines pension benefit obligation as a standardized disclosure measure of the actuarial present
value of pension benefits, adjusted for the effects of projected salary increases, estimated to be payable in the future
as a result of employee service to date. The measure is intended to help users assess the funding status of public
employee pension plans, assess progress made in accumulating sufficient 'assets to pay benefits when due, and
make comparisons among public employee pension plans.
The pension benefit obligation shown below is similar in nature to the standardized disclosure measure required by
GASB 5 for defined benefit plans except that there is no need to project salary increases since the benefit credits
earned for service to date are not dependent upon future salaries. The calculations were made as part of the annual
actuarial valuation as of December 31, 1996. Because of the money- purchase nature of the plan, the interest rate
assumption, currently 8.0% per year, does not have as much impact on the results as it does for a defined benefit
plan. Market value of assets is not determined for each City's plan, but the market value of assets for TMRS as a I
whole was 102.7% of book value as of December 31, 1996.
Pension Benefit Obligation
Annuitants currently receiving benefits $ 531,372
Terminated employees 690,170
Current Employees:
Accumulated employee contributions,including allocated invested earnings 2,685,490
Employer-financed vested 3,115,156
Employer-financed nonvested 509,515
Total Pension Benefit Obligation 7,531,703
Net assets available for benefits,at book value 6,820,961
Unfunded Pension Benefit Obligation $ 710,742
45
CITY OF FRIENDSWOOD
Exhibit A-6
INOTES TO FINANCIAL STATEMENTS
1 NOTE 10-RETIREMENT PLANS (continued)
Unfunded Pension Benefit Obligation
The book value of assets is amortized cost for bonds and original cost for short-term securities and stocks. The
assumptions used to compute the actuarially determined City contribution rate are the same as those used to
compute the pension benefit obligation. The numbers above reflect the adoption of changes in the plan since the
previous actuarial valuation, which had the effect of increasing the pension benefit obligation by$25,356.
Trend Information
Trend information gives an indication of the progress made in accumulating sufficient assets to pay benefits when
due. Ten-year historical trend information presenting the progress in accumulating sufficient assets to pay benefits
when due is presented in the statistical section (Table 16) of the City' Comprehensive Annual Financial Report.
Trend information for the last three calendar years follows:
Calendar Year
1994 1995 1996
' Net assets available for
benefits as a percentage
of pension benefit
obligation 87% 89% 91%
Unfunded pension benefit
obligation as a percentage
of annual covered payroll 17% 17% 17%
Employer contribution as a
percentage of annual covered
payroll 6% 7% 7%
INOTE 11 -DEFERRED COMPENSATION PLAN
The City offers its employees a tax-deferred compensation plan meeting the requirements of Internal Revenue Code
Section 457. The plan was established by City Ordinance which appointed ICMA Retirement Corporation as plan
administrator. The City's fiduciary responsibility is to remit employee deferred compensation to the administrator
on a regular basis. The deferred compensation is not available to employees until termination, retirement, death, or
1 emergency. At September 30, 1997, the plan assets had a market value of$729,374.
All amounts of compensation deferred under the plan,all property and rights purchased with those amounts, and all
income attributable to those amounts, property, or rights are (until paid or made available to the employee or other
beneficiary) solely the property and rights of the City (without being restricted to the provisions of the benefits
under the plan), subject only to the claims of the City's general creditors. Participants' rights under the plan are
equal to those of general creditors of the City in an amount equal to the fair market value of the deferred account
for each participant.
' 46
3
CITY OF FRIENDSWOOD
Exhibit A-6
NOTES TO FINANCIAL STATEMENTS
NOTE 12- SOUTHEAST WATER PURIFICATION PLANT
The City has entered into a contract with the City of Houston for constructing, operating, and maintaining a water
purification plant known as Southeast Water Purification Plant. The City's pro rata share of the actual production 1
construction costs of the project is 3.75 percent. The City's pro rata share of the actual pumping construction costs is
1.33 percent.
The City began receiving water from the plant on October 15, 1990. The City is billed on a monthly basis for the I
actual gallons of water received times the City's pro rata share of actual costs. At the end of each quarter, the City of
Houston computes the total operation and maintenance expense for the quarter just ended,recalculates the cost per one
thousand gallons, and adjusts previous billings on the next invoice.
The relationship of the parties is of a fiduciary character. No partnership or joint venture is created by this contract.
NOTE 13- BLACKHAWK REGIONAL WASTE TREATMENT PLANT
The City has entered into an arrangement with the Gulf Coast Waste Disposal Authority for the operation and I
maintenance of a joint treatment plant known as Blackhawk Regional Waste Treatment Plant. The City of
Friendswood, the City of Houston, Harris County MUD No. 55, and Baybrook MUD 1, (the "participants") share in
the expense of operation and maintenance based on their respective usage on a monthly basis. The percentages of
equity in the joint venture based on their respective capacity rights at September 30, 1997 are as follows:
City of Friendswood 52.47 %
City of Houston 16.18
Harris County MUD No. 55 20.27
Baybrook MUD No. 1 11.08
100.00 %
I
An annual budget for operations is submitted to the Gulf Coast Waste Disposal Authority each year. The Gulf Coast
Waste Disposal Authority is the governing authority and consists of nine members (three appointed by the governor,
three appointed by Harris County, Galveston County, and Chambers County, and three appointed by the participants).
Separate financial statements for the joint venture were available in the December 31, 1996 audited financial
statements of the Gulf Coast Waste Disposal Authority and are summarized below:
Joint
Venture
Total assets $ 425,208
Total liabilities (425,208)
Total fund equity
Total revenues 1,350,799
Total expenditures/expenses (1,350,799)
Net Decrease
$ -0-
I
47
e
CITY OF FRIENDSWOOD
IExhibit A-6
NOTES TO FINANCIAL STATEMENTS
1 NOTE 14-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 encompasses obtaining
property and liability insurance through Texas Municipal League (TML), an Intergovernmental Risk-Pool. The City
has not had any significant reduction in insurance coverage and the amounts of insurance settlements have not
exceeded insurance coverage for any of the last three years. The participation of the City in TML is limited to
payment of premiums. During the year ended September 30, 1997 the City paid premiums of approximately $152,918
to TML for provisions of various liability, property and casualty insurance. The City has various deductible amounts
ranging from$1,000 to$5,000 on various policies. At year-end,the City did not have any significant claims.
The City also provides workers compensation insurance on its employees through TML. The Workers compensation
' premiums for the year ended September 30, 1997 were approximately $201,857. Workers compensation is subject to
change when audited by TML. At year end September 30, 1997 the City believed the amounts paid on workers
compensation would not change significantly from the amounts recorded.
During the year ended September 30, 1997 employees of the City were covered by a health and dental insurance plan
(the plan) with TML. The City paid premiums of approximately $213 per month per employee plus $443 per month
per employee for 70% of the dependents coverage to the plan. All premiums were paid to TML. The City does not
retain any risk of loss on health and dental insurance.
1
I
I
I
48
I
I
I
I
I
I
I
I
I
ICOMBINING,INDIVIDUAL FUND AND ACCOUNT GROUP
STATEMENTS AND SCHEDULES
I
I
I
I
I
I
I
I
I
1
1
1
1
I
GENERAL FUND
' The General Fund accounts for the resources used to finance the fundamental operations of the City. It is
the basic fund of the City and covers all activities for which a separate fund has not been established.
I
I
I
I CITY OF FRIENDSWOOD, TEXAS
GENERAL FUND Exhibit B-1
COMPARATIVE BALANCE SHEET
1 September 30, 1997 and 1996
1 1997 1996
Assets
ICash and cash equivalents $ 481,278 $ 1,039,380
Investments 1,528,515 1,648,831
I
Receivables
Taxes 173,423 170,863
Customer accounts 152,506 154,745
1 Interest receivable 31,500
197,374 28,947
Other 43,897
Due from other governments 18,443 52,313
1 Due from other funds 44,037
Inventory 10,472 8,195
Prepaids and other assets 35,334 44,715
I
Total Assets $ 2,628,845 $ 3,235,923
I
ILiabilities and Fund Balance
Liabilities
I
Accounts payable $ 382,621 $ 370,217
Accrued liabilities 218,615 186,784
Compensated absences 600,887 683,097
Due to other funds 81,250'
Deferred revenue 285,085 293,590
I
Total Liabilities 1,487,208 1,614,938
Fund Balance
Reserved for encumbrances 31,928 62,343
IReserved for inventories 10,472 8,195
Reserved for prepaids and other assets 35,334 44,715
Unreserved:
IDesignated for emergency operations 950,000 900,000
Undesignated 113,903 605,732
ITotal Fund Balance 1,141,637 1,620,985
I
Total Liabilities and Fund Balance $ 2,628,845 $ 3,235,923
I49
I
CITY OF FRIENDSWOOD, TEXAS
GENERAL FUND Exhibit B-2
STATEMENT OF REVENUES,EXPENDITURES,AND Page 1 of 8
CHANGES IN FUND BALANCE-
BUDGET AND ACTUAL
Year Ended September 30,1997
with comparative actual balances for the Year Ended September 30, 1996
1997
VarianceI
Favorable 1996
Budget Actual (Unfavorable) Actual
Revenues
Property taxes $ 4,673,262 $ 4,712,049 $ 38,787 $ 4,303,607
Sales taxes 1,658,840 1,629,754 (29,086) 1,439,030
Franchise fees 703,300 859,378 156,078 852,091
Sanitation 994,216 1,011,101 16,885 1,017,028
Fines and forfeitures 313,600 347,670 34,070 353,742
Permits and fees 431,848 469,669 37,821 401,720
Donations 17,893 21,844 3,951 10,087
Intergovernmental 14,280 11,510 (2,770) 40,055
Interest on investments 179,400 229,470 50,070 202,771
Other 83,900 121,161 37,261 95,172
Total Revenues 9,070,539 9,413,606 343,067 8,715,303
Expenditures
General Government:
Mayor and Council:
Personnel services 289 281 8 268
Supplies 1,744 1,591 153 1,519
Other services and charges 52,394 52,396 (2) 37,787
Capital outlay 850 850
Total Mayor and Council 55,277 54,268 1,009 39,574
City Manager: I
Personnel services 201,083 195,046 6,037 189,798
Supplies 3,100 3,059 41 4,810
Repairs and maintenance 496 (496) 909
Other services and charges 31,365 34,152 (2,787) 20,280
Total City Manager 235,548 232,753 2,795 215,797
City Secretary:
Personnel services 127,521 127,210 311 124,734 I
Supplies 3,920 3,512 408 3,100
Repairs and maintenance 1,650 2,296 (646) 2,285
Other services and charges 29,426 35,134 (5,708) 26,237 I
Capital outlay 6,889 6,289 600 2,234
Total City Secretary 169,406 174,441 (5,035) 158,590
I
50 I
I
ICITY OF FRIENDSWOOD, TEXAS
GENERAL FUND Exhibit B-2
STATEMENT OF REVENUES,EXPENDITURES,AND Page 2 of 8
ICHANGES IN FUND BALANCE-
BUDGET AND ACTUAL
1 Year Ended September 30, 1997
with comparative actual balances for the Year Ended September 30, 1996
I 1997
Variance
I Favorable
(U 1996
Budget Actual (Unfavorable) Actual
Expenditures(continued)
General Government: (continued)
I
Administration:
Finance:
Personnel services $ 281,344 $ 274,822 $ 6,522 $ 262,177
ISupplies 9,400 8,381 1,019 9,198
Repairs and maintenance 250 185 65 428
Other services and charges 58,703 54,970 3,733 39,266
ITotal Finance 349,697 338,358 11,339 311,069
Human Resources:
I Personnel services 112,886 93,590 19,296 106,271
Supplies 8,026 4,900 3,126 3,844
Repairs and maintenance 1,129 286 843 993
IOther services and charges 24,661 33,714 (9,053) 15,339
Total Human Resources 146,702 132,490 14,212 126,447
I Tax:
Other services and charges 129,443 123,766 5,677 121,613
I Economic Development
Other services and charges 13,610 12,812 798 12,742
Legal:
I Other services and charges 238,614 268,546 (29,932) 119,261
Public utilities services and charges 1,400 847 553 106,101
ITotal Legal 240,014 269,393 (29,379) 225,362
Municipal Court:
Personnel services 158,270 146,849 11,421 148,457
I Supplies 5,850 5,382 468 3,909
Repairs and maintenance 100 141 (41)
Other services and charges 13,665 8,015 5,650 13,264
ICapital outlay 3,500 3,500
Total Municipal Court 181,385 160,387 20,998 167,197
I
I
51
I
CITY OF FRIENDSWOOD, TEXAS
GENERAL FUND Exhibit B-2
STATEMENT OF REVENUES,EXPENDITURES,AND Page 3 of 8
CHANGES IN FUND BALANCE-
BUDGET AND ACTUAL
Year Ended September 30, 1997 I
with comparative actual balances for the Year Ended September 30, 1996
I
1997
Variance
Favorable 1996
Budget Actual (Unfavorable) Actual
Expenditures (continued)
Computer Services:
Personnel services $ 36,498 $ 25,245 $ 11,253 $ 48,242
Supplies 31,071 32,984 (1,913) 14,909
Repairs and maintenance 41,546 38,570 2,976 44,774
Other services and charges 435,576 365,560 70,016 39,541
Capital outlay 95,317 98,095 (2,778) 18,343
Total Computer Services 640,008 560,454 79,554 165,809
Risk Management: I
Supplies 1,400 768 632 943
Insurance 71,035 67,556 3,479 67,275
Other services and charges 5,645 2,027 3,618 3,3521
Total Risk Management 78,080 70,351 7,729 71,570
Total General Government 2,239,170 2,129,473 109,697 1,615,770 I
Public Safety:
Police Services:
Personnel services 2,206,262 2,205,126 1,136 1,925,198
Supplies 94,589 109,118 (14,529) 109,161
Repairs and maintenance 79,695 109,176 (29,481) 77,368
Other services and charges 80,036 74,144 5,892 76,778
Capital outlay 6,800 41,007 (34,207) 20,829
Total Police Services 2,467,382 2,538,571 (71,189) 2,209,334
Communications:
Personnel services 435,268 461,776 (26,508) 409,809
Supplies 6,475 4,448 2,027 4,246
Repairs and maintenance 3,350 3,997 (647) 3,998
Other services and charges 7,355 5,760 1,595 6,194
Capital outlay 2,668 2,668 2,913
Total Communications 455,116 475,981 (20,865) 427,160
52
I
ICITY OF FRIENDSWOOD,TEXAS
GENERAL FUND Exhibit B-2
STATEMENT OF REVENUES,EXPENDITURES,AND Page 4 of 8
ICHANGES IN FUND BALANCE-
BUDGET AND ACTUAL
IYear Ended September 30, 1997
with comparative actual balances for the Year Ended September 30, 1996
I
1997
I Variance
Favorable 1996
Budget Actual (Unfavorable) Actual
I Expenditures(continued)
Public Safety: (continued)
I Animal Control:
Personnel services $ 89,181 $ 81,020 $ 8,161 $ 68,669
Supplies 6,980 8,930 (1,950) 5,967
I Repairs and maintenance 2,050 1,927 123 1,896
Other services and charges 5,824 2,773 3,051 3,687
Capital outlay 5,600 5,394 206
ITotal Animal Control 109,635 100,044 9,591 80,219
Fire and EMS:
IPersonnel services 180,112 171,307 8,805 158,771
Supplies 79,246 1,198 78,048 1,348
Repairs and maintenance 81,519 14,988 66,531 24,896
IOther services and charges 96,630 234,484 (137,854) 210,500
Capital outlay 22,678 22,678
ITotal Fire and EMS 460,185 444,655 15,530 395,515
Fire Marshal:
I Personnel services 113,419 108,025 5,394 96,083
Supplies 4,129 3,621 508 6,271
Repairs and maintenance 1,750 969 781 1,801
IOther services and charges 8,740 7,436 1,304 12,360
Total Fire Marshal 128,038 120,051 7,987 116,515
IEmergency Management:
Personnel services 5,112 4,296 816 2,817
Supplies 946 1,517 (571) 1,588
IRepairs and maintenance 2,504 1,500 1,004 2,485
Other services and charges 1,631 1,335 296 2,436
1 Total Emergency Management 10,193 8,648 1,545 9,326
Total Public Safety 3,630,549 3,687,950 (57,401) 3,238,069
I
53
I
CITY OF FRIENDSWOOD, TEXAS
3
GENERAL FUND Exhibit B-2
STATEMENT OF REVENUES, EXPENDITURES,AND Page 5 of 8
CHANGES IN FUND BALANCE-
BUDGET AND ACTUAL
Year Ended September 30, 1997 I
with comparative actual balances for the Year Ended September 30, 1996
I
1997
Variance
Favorable 1996
Budget Actual (Unfavorable) Actual
Expenditures(continued)
I
Public Works:
Administration:
Personnel services $ 123,083 $ 120,717 $ 2,366 $ 119,782
Supplies 2,250 1,492 758 2,011
Repairs and maintenance 1,006 219 787 401
Other services and charges 4,140 3,401 739 4,081 1
Capital Outlay 650
Reserves and contingencies 7,243
Total Administration 130,479 125,829 4,650 134,168 I
Streets:
Personnel services 263,319 245,852 17,467 207,108
Supplies 54,361 62,591 (8,230) 68,696
Repairs and maintenance 90,647 87,282 3,365 83,742
Other services and charges 212,423 206,610 5,813 204,597
Capital outlay 2,639 2,556 83 5,799
Total Streets 623,389 604,891 18,498 569,942 111
Drainage:
Personnel services 120,180 118,123 2,057 111,513
Supplies 785 507 278 812
Repairs and maintenance 16,000 20,860 (4,860) 24,199
Other services and charges 55,758 49,341 6,417 6,300
Capital outlays 4,995
Total Drainage 192,723 188,831 3,892 147,819
Sanitation:
Other services and charges 964,035 939,395 24,640
Reserves and Contingencies 9,337 1,982 _ 7,355 954,018
Total Sanitation 973,372 941,377 31,995 954,018
Total Public Works 1,919,963 1,860,928 59,035 1,805,947
54 I
I
1 CITY OF FRIENDSWOOD,TEXAS
GENERAL FUND Exhibit B-2
1 STATEMENT OF REVENUES,EXPENDITURES,AND Page 6 of 8
CHANGES IN FUND BALANCE-
1 BUDGET AND ACTUAL
Year Ended September 30, 1997
1 with comparative actual balances for the Year Ended September 30, 1996
I
1997
Variance
Favorable 1996
I
Budget Actual (Unfavorable) Actual
Community Development:
Administration:
I
Personnel services Supplies $ 89,513 $ 57,097 $ 32,416 $
(1) 88,516
500 501 213
Other services and charges 2,619 3,451 (832) 864
I
Total Administration 92,632 61,049 31,583 89,593
Planning and Zoning:
I
Personnel services 74,620 74,566 54 70,937
Supplies 1,250 1,630 (380) 1,020
Repairs and maintenance 225 209 16 29
I
Other services and charges 8,134 3,505 4,629 3,364
Capital outlay 1,406 (1,406)
I
Total Planning and Zoning: 84,229 81,316 2,913 75,350
Engineering:
I Personnel services Supplies 54,755 36,800 17,955 57,130
2,800 2,127 673 2,106
Repairs and maintenance 2,600 2,442 158 2,114
I Other services and charges Capital outlay 8,818 30,281 (21,463) 7,251
800 783 17 2,070
IITotal Engineering: 69,773 72,433 (2,660) 70,671
Inspection:
I Personnel services 147,650 130,759 16,891 176,926
Supplies 3,825 4,535 (710) 5,068
Repairs and maintenance 2,350 2,992 (642) 1,358
I Other services and charges 12,101 9,371 2,730 28,323
Capital Outlay 3,627
Total Inspection 165,926 147,657 18,269 215,302
I
Total Community Development 412,560 362,455 50,105 450,916
I55
1
CITY OF FRIENDSWOOD, TEXAS
GENERAL FUND Exhibit B-2
STATEMENT OF REVENUES, EXPENDITURES,AND Page 7 of 8
CHANGES IN FUND BALANCE-
BUDGET AND ACTUAL
Year Ended September 30, 1997
with comparative actual balances for the Year Ended September 30, 1996 1
1997
Variance
Favorable 1996
Budget Actual (Unfavorable) Actual I
Expenditures(continued)
Community Services:
Health Services:
111
Other services and charges $ 45,500 $ 31,347 $ 14,153 $ 62,572
Total Health Services 45,500 31,347 14,153 62,572
Library:
Personnel services 368,553 353,371 15,182 339,343
Supplies 117,782 107,315 10,467 86,803
Repairs and maintenance 3,210 2,326 884 520
Other services and charges 29,493 25,296 4,197 20,777
Capital Outlay 19,433 4,144 15,289 2,933
Total Library 538,471 492,452 46,019 450,376
Parks and Recreation
Personnel services 134,155 131,614 2,541 220,669
Supplies 44,160 28,906 15,254 26,655
Repairs and maintenance 51,095 53,010 (1,915) 23,338
Other services and charges 139,333 152,182 (12,849) 139,841
Capital Outlay 13,400 18,489 (5,089) 26,063
Total Parks and Recreation 382,143 384,201 (2,058) 436,566 1
Community Activities:
Personnel services 218,823 202,022 16,801 102,416
Supplies 22,998 19,555 3,443 15,602
Repairs and maintenance 7,125 3,007 4,118 2,569
Other services and charges 46,286 55,454 (9,168) 54,063
Capital Outlay 53,601 7,241 46,360 14,588
Total Community Activities 348,833 287,279 61,554 189,238
I
I
56 1
I
CITY OF FRIENDSWOOD, TEXAS
GENERAL FUND Exhibit B-2
ISTATEMENT OF REVENUES,EXPENDITURES,AND Page 8 of 8
CHANGES IN FUND BALANCE-
IBUDGET AND ACTUAL
Year Ended September 30, 1997
Iwith comparative actual balances for the Year Ended September 30, 1996
I 1997
Variance
Favorable 1996
I Budget Actual (Unfavorable) Actual
Expenditures(continued)
Swimming Pool:
I Personnel services $ 35,128 $ 31,690 $ 3,438 $ 33,725
Supplies 8,085 6,984 1,101 10,646
Repairs and maintenance 16,150 17,193 (1,043) 4,421
IOther services and charges 14,900 12,951 1,949 14,512
Total Swimming Pool 74,263 68,818 5,445 63,304
I Building Operations:
Personnel services 36,710 25,814 10,896 27,804
Supplies 21,975 23,698 (1,723) 32,459
I Repairs and maintenance 95,280 89,137 6,143 44,462
Other services and charges 295,127 342,344 (47,217) 337,855
Capital Outlay 20,000 1,923 18,077 13,829
ITotal Building Operations 469,092 482,916 (13,824) 456,409
Total Community Services 1,858,302 1,747,013 111,289 1,658,465
1 Total Expenditures 10,060,544 9,787,819 272,725 8,769,167
I Revenues Over(Under)
Expenditures (990,005) (374,213) 615,792 (53,864)
I Other Financing Sources(Uses)
Proceeds from capital leases 411,376 411,376
Operating transfers in 422,176 100,000 (322,176) 229,460
I Operating transfers(out) (616,511) (616,511)
Total Other Financing Sources(Uses) 217,041 (105,135) (322,176) 229,460
Revenues and Other Financing Sources
I Over(Under)Expenditures and
Other Financing(Uses) (772,964) (479,348) 293,616 175,596
Fund balance-Beginning 1,620,985 1,620,985 1,445,389
IFund Balance-Ending $ 848,021 $ 1,141,637 $ 293,616 $ 1,620,985
I57
I
I
I
1
I
I
I
ISPECIAL REVENUE FUNDS
I These funds are used to account for the proceeds of specific revenue sources that are legally restricted to financing
specific purposes. The following describes the various types of Special Revenue Funds used by the City:
Police Investigation Fund
IThis fund receives funds that are restricted to police investigation.
Centenial Fund
I This fund receives donations that are restricted for the commemoration of the 1995-96 centennial for the
City.
I Fire/EMS Donation Fund
This fund receives funds that are restricted for Fire/EMS capital outlays.
I
I
I
I
I
I
I
CITY OF FRIENDSWOOD, TEXAS
SPECIAL REVENUE FUNDS 3
COMBINING BALANCE SHEET
September 30, 1997 1
with comparative totals for September 30, 1996
I
Police Fire/EMS
Investigation Donations Centennial I
Assets
Cash and cash equivalents $ 6,953 $ 46,900 $ 2,147
Investments 54,225
Interest receivable 1,200
Miscellaneous receivables
Total Assets $ 6,953 $ 102,325 $ 2,147
1
Liabilities and Fund Balance
Liabilities
Accounts payable and accrued liabilities $ 441 $ $ 986
Fund Balances
Unreserved:
Designated for police investigations 6,512
Designated for Fire/EMS 102,325
Designated for centennial observance 1,161
Total Fund Balances 6,512 102,325 1,161
Total Liabilities and Fund Balances $ 6,953 $ 102,325 $ 2,147
I
I
1
1
58 1
Exhibit C-1
1
Totals
1997 1996
$ 56,000 $ 52,793
54,225 84,258
' 1,200
1,479
$ 111,425 $ 138,530
1
t
$ 1,427 $ 1,485
6,512 8,000
102,325 124,870
I1,161 4,175
109,998 137,045
$ 111,425 $ 138,530
I
I
I
I
59
I
CITY OF FRIENDSWOOD
SPECIAL REVENUE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES,AND
CHANGES IN FUND BALANCE I
Year Ended September 30, 1997
with comparative totals for the Year Ended September 30, 1996
Police Fire/EMS I
Investigation Donations Centennial
Revenues I
Donations $ 305 $ 109,850 $ 382
Interest 134 9,006 30
Other 6,118 70
Total Revenues 6,557 118,856 482
Expenditures
Current:
Public safety 8,045 150,401111
Community services 3,496
Total Expenditures 8,045 150,401 3,496
Revenues Over(Under)
Expenditures (1,488) (31,545) (3,014) 1
Other Financing Sources
Proceeds from the sale of equipment I
Operating transfers in 9,000
Operating transfers(out)
Total Other Financing Sources 9,000 _ I
Revenues and Other Financing Sources
Over(Under)Expenditures (1,488) (22,545) (3,014)
Fund balances,beginning of year 8,000 124,870 4,175
Fund Balances,End of Year $ 6,512 $ 102,325 $ 1,161
I
I
60 I
I
IExhibit C-2
I
I
ITotals
1997 1996
I $ 110,537 $ 118,172
9,170 5,624
I6,188 666
125,895 124,462
I
I 158,446 91,891
3,496 28,444
I161,942 120,335
I (36,047) 4,127
I9,000 9,600
(840)
II9,000 8,760
I (27,047) 12,887
I137,045 124,158
I $ 109,998 $ 137,045
I
I
1 61
I
CITY OF FRIENDSWOOD, TEXAS
SPECIAL REVENUE FUND(POLICE INVESTIGATION) Exhibit C-3
STATEMENT OF REVENUES, EXPENDITURES,AND
CHANGES IN FUND BALANCE- I
BUDGET AND ACTUAL
Year Ended September 30, 1997
with comparative actual balances for the Year Ended September 30, 1996 ill
I
1997
Variance
Favorable 1996
Budget Actual (Unfavorable) Actual
Revenues
Donations $ 15,150 $ 305 $ (14,845) $ 6,624
Interest on investments 350 134 (216) 519
Other 6,118 6,118
Total Revenues 15,500 6,557 (8,943) 7,143
I
Expenditures
Public safety 15,500 8,045 7,455 7,391
Revenues(Under)
Expenditures (1,488) (1,488) (248) I
Fund balances-Beginning 8,000 8,000 8,248 I
I
Fund Balances-Ending $ 8,000 $ 6,512 $ (1,488) $ 8,000
I
I
I
I
I
62 I
I
ICITY OF FRIENDSWOOD, TEXAS
SPECIAL REVENUE FUND(FIRE/EMS DONATIONS) Exhibit C-4
STATEMENT OF REVENUES,EXPENDITURES,AND
I
CHANGES IN FUND BALANCE-
BUDGET AND ACTUAL
I Year Ended September 30,1997
with comparative actual balances for the Year Ended September 30, 1996
I
1997
I Variance
Favorable 1996
Budget Actual (Unfavorable) Actual
I Revenues
Donations $ 110,000 $ 109,850 $ (150) $ 109,480
Intergovernmental
IInterest on investments 2,270 9,006 6,736 4,353
Total Revenues 112,270 118,856 6,586 113,833
I
I Expenditures
Public safety 150,401 150,401 84,500
ITotal Expenditures 150,401 150,401 84,500
IRevenues Over(Under)
Expenditures (38,131) (31,545) 6,586 29,333
IOther Financing Sources
Proceeds from the sale
Iof equipment 4,600 (4,600) 9,600
Operating transfers in 9,000 9,000
ITotal Other Financing
Source 4,600 9,000 4,400 9,600
Revenues and Other
I Financing Sources Under
Expenditures (33,531) (22,545) 10,986 38,933
IFund balances-Beginning 124,870 124,870 85,937
Fund Balances-Ending $ 91,339 $ 102,325 $ 10,986 $ 124,870
I63
1
CITY OF FRIENDSWOOD, TEXAS
SPECIAL REVENUE FUND(CENTENNIAL) Exhibit C-5
STATEMENT OF REVENUES,EXPENDITURES,AND
CHANGES IN FUND BALANCE-
BUDGET AND ACTUAL
Year Ended September 30, 1997 1
with comparative actual balances for the Year Ended September 30, 1996
1997 1
Variance
Favorable 1996
Budget Actual (Unfavorable) Actual
Revenues I
Donations $ $ 382 $ 382 $ 2,068
Interest on investments 30 30 752
Other 70 70 666
Total Revenues 482 482 3,486 1
Expenditures I
Public Safety
Community services 1,909 3,496 (1,587) 28,444
Total Expenditures 1,909 3,496 (1,587) 28,444 1
Revenues(Under)
Expenditures (1,909) (3,014) (1,105) (24,958)
Other Financing Sources(Usesl 1
Operating transfers in
Operating transfers(out) (840)
Total Other Financing 1
Sources(Uses) (840)
Revenues and Other 1
Financing Sources Under
Expenditures and Other
Financing Uses (1,909) (3,014) (1,105) (25,798)
Fund balances-Beginning 4,175 4,175 29,973 1
Fund Balances-Ending $ 2,266 $ 1,161 $ (1,105) $ 4,175
I
I
64
I
I
I
I
I
I
I
I
1
DEBT SERVICE FUND
IThe Debt Service Fund is used to account for property taxes levied for payment of principal and
interest on all general long-term debt of the City.
I
I
I
I
I
I
I
1
1
I
CITY OF FRIENDSWOOD, TEXAS
DEBT SERVICE FUND Exhibit D-1
COMPARATIVE BALANCE SHEET
September 30, 1997 and 1996 1
##
1997 1996 '
Assets
Cash and cash equivalents $ $ 113,587
Investments 194,067 181,283
Taxes receivable 57,567 61,110
Accrued interest receivable 3,500 3,183
Due from other funds 201,589
1
Total Assets $ 456,723 $ 359,163
1
Liabilities and Equity
Liabilities
Accounts payable and accrued liabilities $ 6,936 $
Deferred revenue 57,567 61,110
Total Liabilities 64,503 61,110
Equity
Fund Balances:
Reserved for debt service 392,220 298,053
Total Equity 392,220 298,053
Total Liabilities and Equity $ 456,723 $ 359,163
I
I
65 t
I
I
CITY OF FRIENDSWOOD, TEXAS
DEBT SERVICE FUND Exhibit D-2
STATEMENT OF REVENUES,EXPENDITURES,AND
I CHANGES IN FUND BALANCE-
BUDGET AND ACTUAL
I Year Ended September 30, 1997
with comparative actual balances for the Year Ended September 30, 1996
I
1997
I Variance
Favorable 1995
Budget Actual (Unfavorable) Actual
Revenues
IProperty taxes $ 1,021,128 $ 1,034,757 $ 13,629 $ 1,357,090
Interest on investments 20,200 33,311 13,111 29,614
I
Total Revenues 1,041,328 1,068,068 26,740 1,386,704
I
Expenditures
Principal retirement 804,293 899,000 (94,707) 963,272
Interest retirement 192,880 73,097 119,783 238,210
1 Fiscal charges 1,500 1,804 (304) 710
Total Expenditures 998,673 973,901 24,772 1,202,192
IRevenues Over
(Under)Expenditures 42,655 94,167 51,512 184,512
I
Other Financing Sources
I
Operating transfers out 56,573
Total Other Financing Sources 56,573
I
Revenues and Other Financing
Sources Over Expenditures 42,655 94,167 51,512 241,085
1 Fund balances-Beginning 298,053 298,053 56,968
1 Fund Balances-Ending $ 340,708 $ 392,220 $ 51,512 $ 298,053
I
1 66
3
I
I
1
I
I
I
CAPITAL PROJECTS FUNDS
IThe Capital Projects Funds account for financial resources used for the acquisition and/or
constriction of major capital facilities.
ICapital Projects
Used to account for non-building capital projects and infrastructure.
ICapital Facility
Used to account for building related projects.
I
I
I
I
I
I
I
0
CITY OF FRIENDSWOOD, TEXAS '
CAPITAL PROJECTS FUNDS Exhibit E-1
COMBINING BALANCE SHEET ON
September 30, 1997
with comparative totals for September 30, 1996
r
Capital Capital Totals
Projects Facility 1997 1996
Assets
Cash and cash equivalents $ 1,156,371 $ 63,129 $ 1,219,500 $ 307,414
Investments 490,394
Accrued interest receivable 8,609
Other assets 2,825 2,825 2,383
Total Assets $ 1,159,196 $ 63,129 $ 1,222,325 $ 808,800
I
Liabilities and Fund Balances
Liabilities
Accounts payable and
accrued liabilities $ 23,575 $ $ 23,575 $ 29,864
Due to other funds 201,589 201,589
Total Liabilities 225,164 225,164 29,864
Fund Balances I
Reserved for encumbrances 77,521 63,129 140,650 227,493
Designated for authorized construction 856,511 856,511 551,443 I
934,032 63,129 997,161 778,936
Total Liabilities and I
Fund Balances $ 1,159,196 $ 63,129 $ 1,222,325 $ 808,800
I
I
I
67 1
I
CITY OF FRIENDSWOOD,TEXAS
3 CAPITAL PROJECTS FUNDS Exhibit E-2
COMBINING STATEMENT OF REVENUES,EXPENDITURES,AND
3 CHANGES IN FUND BALANCE
Year Ended September 30,1997
with comparative totals for the Year Ended September 30,1996
I Capital Capital Totals
Projects Facility 1997 1996
Revenues
I Donations $ $ $ $ 2,050
Intergovernmental 9,184
Interest 5,084 869 5,953 41,112
Other 100 1,500 1,600 60,966
Total Revenues 5,184 2,369 7,553 113,312
IExpenditures
Capital Outlay:
I Public Works:
Streets 10,015 10,015 697,638
Drainage 3,645
I Community Services:
Parks and recreation 15,638
Building operations 355,128 139,348 494,476 195,912
ITotal Expenditures 365,143 139,348 504,491 912,833
I Revenues(Under)
Expenditures (359,959) (136,979) (496,938) (799,521)
I Other Financing Sources(Uses)
Operating transfers in 695,602 19,561 715,163 390,152
Operating transfers(out) (59,823)
IProceeds from the sale of notes payable 160,000
Total Other
I
Financing Sources 695,602 19,561 715,163 490,329
Revenues and Other Financing
Sources Over(Under)I
Expenditures 335,643 (117,418) 218,225 (309,192)
Fund balances-Beginning 598,389 180,547 778,936 1,088,128 I
Fund Balances-Ending $ 934,032 $ 63,129 $ 997,161 $ 778,936
I
I68
I
1
ENTERPRISE FUND
The Enterprise Fund is used to account for the acquisition, operation, and maintenance of
governmental facilities and services that are entirely or predominantly self-supporting by user
charges. The operations of the water and sewer system are accounted for in the Enterprise Fund to
' reflect the results of operations similar to private enterprise.
1
1
I
CITY OF FRIENDSWOOD, TEXAS
I
ENTERPRISE FUND Exhibit F-1
COMPARATIVE BALANCE SHEET
ISeptember 30, 1997 and 1996
1997 1996
I Assets
Current Assets
Cash and cash equivalents $ 230,216 $ 559,853
I Investments 136,117 676,694
Receivables:
Customer accounts 729,345 685,549
I Interest 5,916 17,951
Other 45,551 21
Due from other funds 81,250
I Prepaids and other assets 62,989
1 72,272
Total Current Assets ,210,134 2,093,590
Restricted Assets
I Investment in Blackhawk joint venture 195,041 191,763
Deposits and impact fees 86,983 154,263
282,024 346,026
ILand,buildings,and equipment,at cost 35,135,762 33,609,322
Less accumulated depreciation (9,993,234) (9,212,238)
Land,Buildings,and Equipment,Net 25,142,528 24,397,084
ITotal Assets $ 26,634,686 $ 26,836,700
Liabilities and Fund Equity
I Current Liabilities
Accounts payable $ 240,135 $ 286,798
Accrued liabilities 251,501 98,122
I Compensated absences 71,914 74,578
Customer deposits 18,742 171,055
Due to other funds 44,037
I Bonds payable,current portion 940,500 880,950
Certificates of obligation payable,current portion 155,000 430,000
Total Current Liabilities 1,677,792 1,985,540
I Long-Term Liabilities
Bonds payable, less current portion 3,103,851 4,044,351
Certificates of obligation payable,less current portion 5,585,000 5,740,000
I Accreted interest on premium compound interest bonds 264,135 230,758
Total Long-Term Liabilities 8,952,986 10,015,109
Total Liabilities 10,630,778 12,000,649
Fund Equity
IContributed capital 12,435,358 11,761,849
Retained Earnings:
Reserved for water and sewer construction 112,091 2,145,671
IReserved for debt service 115,924 115,924
Unreserved 3,340,535 812,607
Total Retained Earnings 3,568,550 3,074,202
I Total Fund Equity 16,003,908 14,836,051
$
Total Liabilities and Fund Equity $ 26,634,686 26,836,700
I
69
I
CITY OF FRIENDSWOOD, TEXAS
ENTERPRISE FUND Exhibit F-2
SCHEDULE OF REVENUES,EXPENSES,AND CHANGES IN Page 1 of 3
RETAINED EARNINGS-BUDGET AND ACTUAL I
(NON-GAAP BUDGETARY BASIS)
Year Ended September 30, 1997 1
with comparative actual balances for the Year Ended September 30, 1996
1997 1
Variance
Favorable 1996 I
Budget Actual (Unfavorable) Actual
Operating Revenues
Water charges $ 2,859,047 $ 2,589,842 $ (269,205) $ 2,796,977
Sewer charges 1,956,412 1,947,140 (9,272) 1,919,924 1
Fees and penalties 108,000 140,717 32,717 114,460
Other 144,894 66,858 (78,036) 163,758
Total Operating Revenues 5,068,353 4,744,557 (323,796) 4,995,119 1
Operating Expenses
Water Operations:
Personnel services 247,164 241,491 5,673 231,608
Supplies 41,900 46,309 (4,409) 46,241
Repairs and maintenance 82,494 69,977 12,517 146,515
Other services and charges 522,826 492,344 30,482 565,171
Capital outlay 202,952 130,623 72,329 49,106
Total Water Operations 1,097,336 980,744 116,592 1,038,641
Sewer Operations:
Personnel services 202,265 169,987 32,278 183,686
Supplies 12,050 12,314 (264) 14,916
Repairs and maintenance 83,245 103,908 (20,663) 236,871
Other services and charges 1,338,602 1,190,209 148,393 872,870
Reserves and contingencies 29,118 9,178 19,940 17,588
Capital outlay 1,126,173 1,028,397 97,776 1,109,131
Total Sewer Operations 2,791,453 2,513,993 277,460 2,435,062
Operation Administration:
Personnel services 271,780 254,386 17,394 98,050
Supplies 9,000 12,251 (3,251) 1,496II
Repairs and maintenance 3,500 5,083 (1,583) 123
Other services and charges 31,509 50,088 (18,579) 1,156
Water and sewer bonds 434 (434) 1,011
Reserves and contingencies 35,001 13,093 21,908
Total Operation Administration 350,790 335,335 15,455 101,836
1
70 I
I
CITY OF FRIENDSWOOD, TEXAS
IENTERPRISE FUND Exhibit F-2
SCHEDULE OF REVENUES,EXPENSES,AND CHANGES IN Page 2 of 3
I RETAINED EARNINGS-BUDGET AND ACTUAL
(NON-GAAP BUDGETARY BASIS)
I Year Ended September 30,1997
with comparative actual balances for the Year Ended September 30, 1996
I 1997
Variance
Favorable 1996
I Budget Actual (Unfavorable) Actual
Operating Expenses (continued)
Finance Administration:
I Personnel services Supplies $ $ $ $ 158,923
6,380
Repairs and maintenance 4,301
I Other services and charges 23,329
Bad debt expense 10,000 11,399 (1,399) 16,002
Capital outlay 14,900 14,900
ITotal Finance Administration 24,900 11,399 13,501 208,935
Computer Services:
Supplies 2,520 2,520 1,809
IRepairs and maintenance 3,316 3,316 2,639
Other services and charges 17,902 17,902 955
Reserves and contingencies 5,500 5,500
I Capital outlay 1,095 1,095 505
Total Computer Services 30,333 30,333 5,908
I Insurance:
Other services and charges 46,974 37,345 9,629 42,077
Total Insurance 46,974 37,345 9,629 42,077
IEngineering:
Personnel services 55,747 57,758 (2,011) 54,090
I Supplies 2,100 2,117 (17) 1,987
Repairs and maintenance 1,500 1,778 (278) 1,476
Other services and charges 21,343 21,465 (122) 460
ITotal Engineering 80,690 83,118 (2,428) 58,013
ITotal Operating Expenses 4,422,476 3,961,934 460,542 3,890,472
Operating Income 645,877 782,623 136,746 1,104,647
I
I
I71
CITY OF FRIENDSWOOD, TEXAS
ENTERPRISE FUND Exhibit F-2
SCHEDULE OF REVENUES,EXPENSES,AND CHANGES IN Page 3 of 3
RETAINED EARNINGS-BUDGET AND ACTUALI
(NON-GAAP BUDGETARY BASIS)
Year Ended September 30, 1997 1
with comparative actual balances for the Year Ended September 30, 1996
1997
Variance
Favorable 1996
Budget Actual (Unfavorable) Actual
Nonoperating Revenues(Expenses)
Interest revenue $ 59,470 $ 63,626 $ 4,156 $ 124,604
Impact fees 88,586 (88,586) 241,725
Gain on sales of property 46,251 (46,251) 1,317
Principal retirement (1,814,052) (1,310,950) 503,102 (898,400)
Interest expense (522,273) (522,273) (727,274)
Total Nonoperating
Revenues(Expenses) (1,619,745) (1,769,597) (149,852) (1,258,028)
Operating Transfers(Out) I
Operating transfers in 2,131,303 30,180 (2,101,123)
Operating transfers(out) (2,729,182) (237,832) 2,491,350 (615,522)
(597,879) (207,652) 390,227 (615,522)
Net Income(Loss)
(Budgetary Basis) $ (1,571,747) (1,194,626) $ 377,121 (768,903)
Adjustments
Depreciation expense (780,996) (873,217)
Capital outlay 1,159,020 1,159,753
Principal retirement 1,310,950 898,400
Net Adjustments 1,688,974 1,184,936
Net Income(GAAP Basis) 494,348 416,033 1
Retained earnings,beginning of year 3,074,202 2,658,169
Retained Earnings,end of year $ 3,568,550 $ 3,074,202 I
I
I
I
72 1
I
ICITY OF FRIENDSWOOD, TEXAS
ENTERPRISE FUND Exhibit F-3
I SCHEDULE OF BONDS PAYABLE-
BY MATURITY DATE
September 30, 1997
I
I Due During Fiscal Year Annual Requirements for All Series Series 1969
Principal Interest Total Total Due
Ending Principal Interest Principal and Due November 1,
I Sept.30, Due Due Interest Due November 1 May 1 Total
1998 $ 940,500 $ 143,127 $ 1,083,627 $ 33,000 $ 3,032 $ 36,032
1999 966,750 104,735 1,071,485 33,000 1,011 34,011
2000 492,375 329,448 821,823
I 2001 396,405 114,052 510,457
2002 398,494 74,577 473,071
2003 416,247 57,964 474,211
I2004 433,580 38,219 471,799
Totals $ 4,044,351 $ 862,122 $ 4,906,473 $ 66,000 $ 4,043 $ 70,043
iDue During Series 1986 Series 1993
Fiscal Year Principal Interest Due Principal Interest Due
I Ending Due November 1, Due March 1,
Sept.30, November 1 May 1 Total March 1 September 1 Total
1998 $ $ $ $ 907,500 $ 140,095 $ 1,047,595
1999 933,750 103,724 1,037,474 I
2000 139,875 251,625 391,500 352,500 77,823 430,323
2001 25,155 51,345 76,500 371,250 62,707 433,957
2002 12,244 28,256 40,500 386,250 46,321 432,571
I 2003 11,247 29,253 40,500 405,000 28,711 433,711
2004 9,830 28,420 38,250 423,750 9,799 433,549
ITotals $ 198,351 $ 388,899 $ 587,250 $ 3,780,000 $ 469,180 $ 4,249,180
I
I
I
I
I
I73
3
CITY OF FRIENDSWOOD, TEXAS
ENTERPRISE FUND Exhibit F-4
SCHEDULE OF CERTIFICATES OF OBLIGATION-
BYMATURITY DATEI
September 30, 1997
I
Due During Annual Requirements for All Series Series 1995
Fiscal Year Total Total Total Principal Interest Due
Ending Principal Interest Principal and Due November 1,
Sept.30, Due Due Interest Due November 1 May 1 Total
1998 $ 155,000 $ 327,360 $ 482,360 $ 70,000 $ 182,251 $ 252,251
1999 160,000 316,275 476,275 75,000 176,904 251,904
2000 170,000 304,654 474,654 80,000 171,189 251,189
2001 175,000 292,494 467,494 85,000 165,104 250,104
2002 185,000 279,797 464,797 90,000 158,651 248,651
2003 200,000 266,910 466,910 100,000 151,645 251,645
2004 210,000 253,945 463,945 100,000 144,270 244,270
2005 645,000 228,494 873,494 155,000 134,964 289,964
2006 680,000 191,064 871,064 190,000 124,239 314,239
2007 715,000 152,935 867,935 230,000 112,923 342,923
2008 760,000 112,488 872,488 275,000 99,150 374,150
2009 815,000 69,175 884,175 815,000 69,175 884,175
2010 870,000 23,381 893,381 870,000 23,381 893,381
Totals $ 5,740,000 $ 2,818,972 $ 8,558,972 $ 3,135,000 $ 1,713,846 $ 4,848,846 1
Due During Series 1992
Fiscal Year Principal Interest Due
Ending Due November 1,
Sept.30, November 1 May 1 Total
1998 $ 85,000 $ 145,109 $ 230,109
1999 85,000 139,371 224,371
2000 90,000 133,465 223,465
2001 90,000 127,390 217,390
2002 95,000 121,146 216,146
2003 100,000 115,265 215,265
2004 110,000 109,675 219,675
2005 490,000 93,530 583,530
2006 490,000 66,825 556,825
2007 485,000 40,012 525,012
2008 485,000 13,338 498,338
2009
2010
Totals $ 2,605,000 $ 1,105,126 $ 3,710,126
1
74 I
I
1
I
I
I
1
1
I
TRUST AND AGENCY FUNDS
1776 Park Trust Fund
This fund has been established by the City to account for 1776 Park assets held in Trust.
Deferred Compensation Agency Fund
iThis fund is used to account for assets held for employees in accordance with the
provisions of Internal Revenue Code Section 457.
I
I
I
I
1
1
I
1
I
CITY OF FRIENDSWOOD,TEXAS
TRUST AND AGENCY FUNDS Exhibit G-1
COMBINING BALANCE SHEET
September 30, 1997
with comparative totals for September 30, 1996
I
Non-
Expendable
Trust Agency
1776 Deferred Totals
Park Compensation 1997 1996
Asset
Cash and cash equivalents $ 20,902 $ $ 20,902 $ 9,208
Investments 14,701
Accrued interest receivable 258
Investments with fiscal agent 971,877 971,877 729,374
Land and Improvements 57,200 57,200 57,200
Total Assets $ 78,102 $ 971,877 $ 1,049,979 $ 810,741 111
Liabilities and Fund Balances
Liabilities
Deferred compensation benefits payable $ $ 971,877 $ 971,877 $ 729,374
I
Fund Balances
Reserved for endowments 67,200 67,200 67,200
Unreserved:
Designated for park improvements 10,902 10,902 14,167
Total Fund Balances 78,102 78,102 81,367 I
Total Liabilities and I
Fund Balances $ 78,102 $ 971,877 $ 1,049,979 $ 810,741
I
I
75
1
' CITY OF FRIENDSWOOD, TEXAS
1776 PARK TRUST FUND(NON-EXPENDABLE TRUST) Exhibit G-2
COMPARATIVE STATEMENTS OF REVENUES,EXPENSES AND
CHANGES IN FUND BALANCE
Year Ended September 30, 1997
with comparative totals for the Year Ended September 30, 1996
1
1997 1996
Revenue
1 Interest on investments $ 734 $ 1,428
Expenses
Community services 3,999 8,600
Revenues Over(Under)Expenditures (3,265) (7,172)
Fund balances,beginning of year 81,367 88,539
1
Fund Balances,End of Year $ 78,102 $ 81,367
1
I
i
I
I
1
I
I
I76
I
CITY OF FRIENDSWOOD, TEXAS
DEFERRED COMPENSATION AGENCY FUND Exhibit G-3
SCHEDULE OF CHANGES IN ASSETS AND LIABILITIES
Year Ended September 30, 1997 1
Balance Balance
October 1, September 30,
1996 Additions Deletions 1997 1
Assets I
Deferred compensation
investments $ 729,374 $ 256,352 $ 13,849 $ 971,877
1
Liabilities
Deferred compensation
benefits payable $ 729,374 $ 256,352 $ 13,849 $ 971,877
77
I
1
I
I
1
I
I
1
I
I
I
I
I
I
I
I
I
GENERAL FIXED ASSETS
IThis account group is established to account for the fixed assets owned by the City excluding those
relating to Enterprise Fund operations. Expenditure transactions to acquire general fixed assets
occur in the Governmental Fund Types.
I
I
I
I
I
I
I
I
I
CITY OF FRIENDSWOOD, TEXAS
IGENERAL FIXED ASSETS Exhibit H-1
COMPARATIVE SCHEDULES OF GENERAL FIXED ASSETS-
I BY SOURCE
September 30, 1997 and 1996
I
1997 1996
IGeneral Fixed Assets
Land $ 3,332,864 $ 3,164,182
I
Buildings 4,533,305 4,362,738
Improvements 16,484,536 16,370,479
Equipment 4,372,817 4,111,389
' Construction in progress 93,321 40,585
Total General Fixed Assets $ 28,816,843 $ 28,049,373
I
I
Investment in General Fixed Assets From
General obligation bonds $ 4,591,258 $ 4,591,258
Time warrants and certificates of
I
obligation 4,861,441 4,861,441
Federal,state,and local obligations 3,248,287 3,198,287
Municipality 13,838,953 13,272,429
Donations 2,276,904 2,125,958
I
Total Investment in
General Fixed Assets $ 28,816,843 $ 28,049,373
I
I
I
I
I
I
I
78
CITY OF FRIENDSWOOD, TEXAS
GENERAL FIXED ASSETS
SCHEDULE OF GENERAL FIXED ASSETS-
BY FUNCTION AND ACTIVITY
September 30, 1997
I
Function and Activity Land Buildings Improvements I
General Government
City Manager $ $ $
City Secretary
Administrative Services
Total General Government 1
Public Safety
Police 10,542 728,007
Fire 18,000 267,322
Emergency management
Total Public Safety 28,542 995,329
public Works
Streets and drainage 375,408 141,816 14,512,150
Total Public Works 375,408 141,816 14,512,150 1
Community Development
Planning and zoning I
Engineering
Inspection
Total Community Development I
Community Services
Library 28,838 591,760
Parks and recreation 1,904,461 382,726 1,132,778
Community activities 308,914
Swimming pool 552,700 717,820
Buildings 442,915 2,112,760 121,788
Total Community Services 2,928,914 3,396,160 1,972,386
Construction in progress
Total General Fixed Assets $ 3,332,864 $ 4,533,305 $ 16,484,536
79
I
IExhibit H-2
I
I
Construction
IEquipment In Progress Total
I $ 23,605 44,704 $ $ 23,605
44,704
841,564 841,564
909,873 909,873
I877,055 1,615,604
1,451,720 1,737,042
I61,745 61,745
2,390,520 3,414,391
I348,462 15,377,836
I348,462 15,377,836
I 1,406 1,406
783 783
I2,189 2,189
I168,164 788,762
307,115 3,727,080
I 308,914
15,268 1,285,788
231,226 2,908,689
I721,773 9,019,233
1
93,321 93,321
I $ 4,372,817 $ 93,321 $ 28,816,843
I80
I
CITY OF FRIENDSWOOD, TEXAS
GENERAL FIXED ASSETS Exhibit H-3
SCHEDULE OF CHANGES IN GENERAL FIXED ASSETS-
BY FUNCTION AND ACTIVITY
Year Ended September 30, 1997
I
General General
Fixed Assets Fixed Assets
Function and October 1, Transfers and September 30, III
Activity 1996 Additions Retirements 1997
General Government I
City Manager $ 23,605 $ $ $ 23,605
City Secretary 38,415 6,289 44,704
Administrative Services 746,473 98,094 (3,003) 841,564
Total General Government 808,493 104,383 (3,003) 909,873
Public Safety
Police 1,654,167 46,945 (85,508) 1,615,604
Fire 1,563,963 173,079 1,737,042
Emergency management 61,745 61,745
Total Public Safety 3,279,875 220,024 (85,508) 3,414,391 1
Public Works
Streets and drainage 15,329,999 2,556 45,281 15,377,836
Total Public Works 15,329,999 2,556 45,281 15,377,836 1
Community Development
Planning and zoning 1,406 1,406
Engineering 783 783
Inspection
Total Community Development 2,189 2,189
Community Services
Library 678,213 110,549 788,762
Parks and recreation 3,410,739 273,111 43,230 3,727,080
Community activities 308,914 308,914
Swimming pool 1,285,788 1,285,788
Buildings 2,906,767 1,922 2,908,689
Total Community Services 8,590,421 385,582 43,230 9,019,233
Construction in progress 40,585 52,736 93,321
Total General Fixed Assets $ 28,049,373 $ 767,470 $ $ 28,816,843 1
81 1
I
I
I
I
I
I
I
GENERAL LONG—TERM DEBT
IThis account group is established to account for the principal outstanding on general obligation
bonds and other long-term liabilities.
I
I
I
I
I
I
I
CITY OF FRIENDSWOOD, TEXAS
ICOMPARATIVE SCHEDULES OF Exhibit I-1
GENERAL LONG-TERM DEBT
ISeptember 30, 1997 and 1996
1 1997 1996
I Amount Available and to be Provided for
the Payment of General Long-Term Debt
IAmount available in Debt Service Fund $ 392,220 $ 298,053
Amount to be provided for retirement of general long-term
debt 3,717,460 4,320,476
Total Amount Available and to be Provided $ 4,109,680 $ 4,618,529
1
General Long-Term Debt Payable
IAccretion on premium compound interest bonds $ 322,835 $ 282,038
Notes payable 181,805
IObligations under capital leases 180,418 219,209
ICertificates of obligation 2,070,000 2,100,000
General obligation bonds 1,536,427 1,835,477
I
Total General Long-Term Debt Payable $ 4,109,680 $ 4,618,529
I
I
I
I
I
I82
3
CITY OF FRIENDSWOOD, TEXAS
SCHEDULE OF CHANGES IN GENERAL LONG-TERM DEBT
September 30, 1997 and 1996
Amounts
Date of Interest Originally
Issue Description Rate Payable Issued
1969 Revenue Bonds- Series 1969 5.5%-6.125% $ 700,000
08/15/86 Refunding Bonds- Series 1986 4.25%-7.9% 10,650,777 1
10/19/92 Certificates of Obligation-Series 1992 5.5%-6.75% 2,160,000
04/14/93 Refunding Bonds- Series 1993 2.25%-4.625% 3,480,000
I
Notes payable 598,567
Obligations under capital leases 195,924
Accretion on premium compound interest bonds 1
Totals
1
I
I
1
1
I
1
83 1
I
IExhibit I-2
I
I Amounts Reallocated Amounts
Outstanding Issued Retired (To)/From Outstanding Interest
October 1, Current Current Enterprise September 30, Current
111 1996 Year Year Fund 1997 Year
$ 49,300 $ $ 15,300 $ $ 34,000 $ 2,551
I242,427 242,427
I2,100,000 30,000 2,070,000 119,783
1,543,750 283,750 1,260,000 57,776
I3,935,477 329,050 3,606,427 180,110
181,805 181,805 10,908
I
219,209 411,376 450,167 180,418 13,770
I282,038 40,797 322,835
I $ 4,618,529 $ 452,173 $ 961,022 $ $ 4,109,680 $ 204,788
I
I
I
1
I
I
84
I
CITY OF FRIENDSWOOD,TEXAS
SCHEDULE OF GENERAL LONG-TERM DEBT
SERVICE REQUIREMENTS TO MATURITY
September 30, 1997
Refunding Bonds
Due During Annual Requirements for All Series Series 1986
Fiscal Year Total Total Total Principal Interest Due
Ending Principal Interest Principal and Due March 1,
Sept.30, Due Due Interest Due March 1 September 1 Total
1998 $ 502,817 $ 175,953 $ 678,770 $ $ $
1999 483,398 151,563 634,961
2000 370,411 439,000 809,411 170,958 307,542 * 478,500
2001 224,494 183,867 408,361 30,744 62,756 * 93,500
2002 298,715 142,589 441,304 14,965 34,535 * 49,500
2003 313,746 128,293 442,039 13,746 35,754 * 49,500
2004 333,264 111,788 445,052 12,014 34,736 * 46,750
2005 285,000 61,320 346,320
2006 305,000 45,238 350,238
2007 325,000 27,913 352,913
2008 345,000 9,488 354,488
Totals $ 3,786,845 $ 1,477,012 $ 5,263,857 $ 242,427 $ 475,323 $ 717,750
Revenue Bonds
Due During Series 1969
111
Fiscal Year Principal Interest Due
Ending Obligations Under Capital Leases Due March 1,
Sept.30, Principal Interest Total March 1 September 1 Total
1998 103,317 11,622 114,939 17,000 1,562 18,562
1999 75,148 5,797 80,945 17,000 521 17,521
2000 1,953 247 2,200
2001
2002
2003
2004II
2005
2006
2007
2008
Totals $ 180,418 $ 17,666 $ 198,084 $ 34,000 $ 2,083 $ 36,083
I
I
I
* Includes accretion on premium compound interest bonds.
85 1
I
1 Exhibit I-3
I
I Due During Certificates of Obligation Refunding Bonds
Series 1992 Series 1993
Fiscal Year Principal Interest Due Principal Interest Due
Ending Due March 1, Due March 1,
ISept.30, March 1 September 1 Total March 1 September 1 Total
1998 $ 80,000 $ 116,070 $ 196,070 $ 302,500 $ 46,699 $ 349,199
1999 80,000 110,670 190,670 311,250 34,575 345,825
I2000 80,000 105,270 185,270 117,500 25,941 143,441
2001 70,000 100,208 170,208 123,750 20,903 144,653
2002 155,000 92,614 247,614 128,750 15,440 144,190
I 2003 165,000 82,969 247,969 135,000 9,570 144,570
2004 180,000 73,785 253,785 141,250 3,267 144,517
2005 285,000 61,320 346,320
I
2006 305,000 45,238 350,238
2007 325,000 27,913 352,913
2008 345,000 9,488 354,488
I
Totals $ 2,070,000 $ 825,545 $ 2,895,545 $ 1,260,000 $ 156,395 $ 1,416,395
I
I
I
I
I
I
I
I
I86
I
I
I
I
I
I
I
IUNAUDITED STATISTICAL SECTION
I
I
I
I
I
I
I
CITY OF FRIENDSWOOD, TEXAS
GENERAL GOVERNMENT REVENUES BY SOURCE
Last Ten Fiscal YearsI
Function 1988 1989 1990 1991 1992 1
General property taxes $4,442,540 $4,562,856 $4,557,133 $ 4,749,173 $4,958,863 1
Sales taxes 510,574 607,349 690,327 742,725 808,405
Franchise taxes 375,755 400,986 419,062 456,566 541,841 I
Sanitation 545,130 542,911 595,244 733,245 780,604
Fines and forfeitures 142,516 190,106 166,982 166,355 171,154 I
Permits and fees 125,083 143,105 240,294 286,421 337,539
Intergovernmental revenue 48,985 53,464 50,984 28,641 34,006 1
Interest on investments 196,647 185,037 222,328 232,773 153,558
Other revenue 106,057 118,539 115,107 139,525 208,466 111
$ 6,493,287 $ 6,804,353 $7,057,461 $ 7,535,424 $ 7,994,436
I
Includes General, Special Revenue,and Debt Service Funds. I
Source-Accounting records of the City.
I
I
1
I
I
I
87 I
I
ITable 1
I
1 1993 1994 1995 1996 1997
5,249,517 $ 5,553,218 $ 5,865,855 $ 5,660,697 $ 5,746,806
Is
979,890 1,001,832 1,028,528 1,439,030 1,629,754
530,059 570,031 863,183 852,091 859,378
838,542 966,066 1,085,149 1,017,028 1,011,101
174,487 217,411 266,287 353,742 347,670
I319,384 296,003 234,518 401,720 469,669
32,273 48,101 46,060 40,055 11,510
I
154,195 107,089 193,588 238,009 271,951
219,615 330,313 354,627 224,097 259,730
I $ 8,497,962 $ 9,090,064 $ 9,937,795 $ 10,226,469 $ 10,607,569
I
I
I
I
I
I
I
I88
3
CITY OF FRIENDSWOOD, TEXAS
GENERAL GOVERNMENT EXPENDITURES BY FUNCTION
Last Ten Fiscal Years
I
Function 1988 1989 1990 1991 1992
General government $ 1,143,024 $ 1,167,194 $ 1,258,050 $ 1,085,683 $ 1,112,882
Public safety 1,934,317 2,038,066 2,173,685 2,478,564 3,061,016 1
Public works 1,128,195 1,108,423 1,196,889 1,521,841 1,537,447
Community development 249,684 257,750 281,723 289,501 326,854 I
Community services 814,380 768,533 949,048 1,048,606 1,087,039
Debt service 1,344,693 1,305,728 1,304,597 1,301,928 1,315,242 I
$ 6,614,293 $ 6,645,694 $ 7,163,992 $ 7,726,123 $ 8,440,480
I
Includes General,Special Revenue,and Debt Service Funds.
Source-Accounting records of the City.
1
I
1
I
I
I
I
I
89 1
I
ITable 2
I
I1993 1994 1995 1996 1997
$ 1,149,344 $ 1,478,817 $ 1,481,710 $ 1,615,770 $ 2,129,473
1 2,814,658 2,846,169 3,206,222 3,329,960 3,846,396
1,621,896 1,783,738 1,792,014 1,805,947 1,860,928
1 386,976 413,489 463,813 450,916 362,455
1,319,689 1,426,792 1,656,146 1,686,909 1,750,509
I1,434,052 1,427,360 1,579,490 1,202,192 973,901
$ 8,726,615 $ 9,376,365 $ 10,179,395 $ 10,091,694 $ 10,923,662
I
I
I
I
I
I
I
I
I
I
I90
I
CITY OF FRIENDSWOOD, TEXAS
PROPERTY TAX LEVIES AND COLLECTIONS
Last Ten Fiscal Years
I
I
Fiscal Year Percent
Ended Tax Tax Total Current Tax of Levy
Sept.30, Year Rate Tax Levy Collections Collected
1987 1986 $ 0.6950 $ 4,369,541 $ 4,245,550 97.16 % I
1988 1987 0.6950 4,351,363 4,248,363 97.63
1989 1988 0.6950 4,553,066 4,433,139 97.37
1990 1989 0.6950 4,531,537 4,427,153 97.70
1991 1990 0.6950 4,636,066 4,561,109 98.38
1992 1991 0.6950 4,869,697 4,782,350 98.21 1
1993 1992 0.6630 5,179,275 5,081,084 98.10
1994 1993 0.6630 5,450,155 5,384,023 98.79 I
1995 1994 0.6630 5,779,760 5,717,509 98.92 1
1996 1995 0.6156 5,610,277 5,568,094 99.25
1997 1996 0.6045 5,692,451 5,652,357 99.30 I
I
Source-Tax assessor/collector's records.
I
1
I
I
91
I
Table 3
I
I Total Outstanding
Collections Delinquent
Delinquent as Percent Outstanding Taxes as
I
Tax Total Tax of Current
Levy Delinquent Percent of
Collections Collections Taxes Levy
I $ 133,831 $ 4,379,381 100.23 % $ 318,441 7.29 %
119,687 4,368,050 100.38 301,754 6.93
I79,695 4,512,834 99.12 341,986 7.51
74,484 4,501,637 99.34 371,886 8.21
I
107,112 4,668,221 100.69 339,731 7.33
I120,660 4,903,010 100.68 306,418 6.29
91,531 5,172,615 99.87 313,078 6.04
I103,113 5,487,136 100.68 276,097 5.07
I89,977 5,807,486 100.48 248,371 4.30
54,842 5,622,936 100.23 231,973 4.13
I53,927 5,706,284 100.24 230,990 4.06
I
I
I
I
I
I92
I
CITY OF FRIENDSWOOD, TEXAS
IASSESSED AND ESTIMATED Table 4
ACTUAL VALUE OF TAXABLE PROPERTY
ILast Ten Fiscal Years
IRatio of
Fiscal Year Estimated Assessed Value
I Ended Tax Assessed Actual to Estimated
Sept.30, Year Value Value Actual Value
1987 1986 $ 628,710,940 $ 760,787,760 82.64 %
I
1988 1987 626,095,422 763,454,517 82.01
I1989 1988 634,729,000 729,914,210 86.96
1990 1989 653,106,888 759,841,760 85.95
I1991 1990 667,059,850 761,569,171 87.59
I1992 1991 700,373,270 806,261,160 86.87
1993 1992 781,187,783 917,420,470 85.15
I1994 1993 825,111,643 976,268,953 84.52
I1995 1994 869,085,848 1,021,248,848 85.10
1996 1995 911,351,022 1,165,107,496 78.22
I1997 1996 941,679,232 1,207,803,598 77.97
I
Source-Tax assessor/collector's records.
I
I
I
I
I
93
3
CITY OF FRIENDSWOOD, TEXAS
PROPERTY TAX RATES AND TAX LEVIES-
DIRECT AND OVERLAPPING
Last Ten Fiscal Years
Friendswood Clear Creek
Independent Independent Clear Creek
Tax City of School School Drainage
Fiscal Year Year Friendswood District District District
I
Tax Levies
1988 1987 $ 4,351,363 $ 6,533,297 $ 45,544,888 $ 763,695
1989 1988 4,553,066 6,849,562 46,984,529 771,330
1990 1989 4,531,537 7,611,417 54,340,449 781,367 1
1991 1990 4,636,066 7,818,079 69,557,334 806,204
1992 1991 4,866,767 8,876,657 77,572,430 856,973 I
1993 1992 5,179,275 10,772,828 91,172,650 899,822
1994 1993 4,564,207 11,518,030 95,705,135 1,037,657 1
1995 1994 5,779,760 12,328,327 99,770,180 1,100,283
1996 1995 5,779,760 13,164,873 99,102,542 1,175,127
1997 1996 5,537,895 12,864,752 100,503,671 1,480,950
111
Tax Rates(*1
1988 1987 $ 0.6950 $ 1.4100 $ 0.9500 $ 0.1500 1
1989 1988 0.6950 1.4100 0.9500 0.1500
1990 1989 0.6950 1.5500 1.0750 0.1500 I
1991 1990 0.6950 1.5500 1.2890 0.1500
1992 1991 0.6950 1.6500 1.2990 0.1500 II
1993 1992 0.6630 1.7200 1.4256 0.1500
1994 1993 0.6630 1.6180 1.4600 0.1450 1
1995 1994 0.6630 1.6090 1.4700 0.1430 I
1996 1995 0.6156 1.5900 1.4700 0.1410
1997 1996 0.6045 1.5750 1.5900 0.1425
Source-Tax Department records of the various taxing authorities.
(*) Per$100 valuation.
94
I
ITable 5
I
IPort of Harris County
Harris Galveston Houston Harris County Hospital
ICounty County Authority Flood Control District
I $ 317,153,627 $ 31,021,686 $ 7,748,212 $ 40,312,374 $ 157,500,730
316,515,115 28,734,107 11,721,027 40,396,410 156,997,245
I
342,106,783 33,270,892 13,285,192 53,821,732 163,778,567
339,934,538 33,629,041 14,325,485 66,823,478 179,453,767
I341,733,008 38,392,445 17,091,568 58,953,528 220,564,979
371,558,722 39,834,245 16,726,662 63,103,788 231,593,228
379,718,078 43,383,400 13,625,480 62,410,785 212,802,322
412,753,000 46,158,111 14,964,000 71,119,000 208,743,464
I409,625,000 52,786,000 16,352,487 70,974,320 208,369,480
405,730,000 52,890,000 16,832,660 70,850,000 202,760,440
1 $ 0.29316 $ 0.3850 $ 0.00715 $ 0.03720 $ 0.13700
0.29455 0.3540 0.01091 0.03760 0.14600
1 0.32600 0.3965 0.01267 0.05130 0.16600
0.31483 0.3965 0.01327 0.06190 0.16621
I0.32188 0.4251 0.01531 0.05280 0.19621
0.32909 0.4300 0.01496 0.05590 0.19621
I0.33854 0.4650 0.01222 0.05565 0.18975
0.36281 0.4850 0.01316 0.06252 0.18350
I0.43330 0.5200 0.01600 0.07424 0.12381
I0.42760 0.5200 0.07420 0.07420 0.12380
I
I95
3
CITY OF FRIENDSWOOD, TEXAS
TAX RATE DISTRIBUTION Table 6
Last Ten Fiscal Years
I
Fiscal Year Debt Total
Ended Tax General Service Tax
Sept.30, Year Fund Fund Rate
1988 1987 $ 0.52000 $ 0.17500 $ 0.69500 1
1989 1988 0.50746 0.18754 0.69500
1990 1989 0.53330 0.16170 0.69500
1991 1990 0.50876 0.18624 0.69500 1
1992 1991 0.50900 0.18600 0.69500
1993 1992 0.50160 0.16140 0.66300 I
1994 1993 0.50250 0.16050 0.66300 1
1995 1994 0.51400 0.14900 0.66300
1996 1995 0.46800 0.14760 0.61560 I
1997 1996 0.49610 0.10840 0.60450
I
Source-City's tax ordinances. I
Tax rates are per$100 valuation.
I
I
I
I
96 I
I
CITY OF FRIENDSWOOD, TEXAS
PRINCIPAL TAXPAYERS Table 7
September 30, 1997
I
IPercent
of Total
— Assessed Assessed
ITaxpayer Type of Property Valuation Valuation
. Exxon Corporation Oil and Gas $ 15,467,470 1.64%
Ii
2 . Southwestern Bell Telephone Utility Company 13,224,420 1.40%
I3 . Texas New Mexico Power Utility Company 8,541,300 0.91%
4 . Friendswood Retirement Living Ltd. Retirement Home 7,204,830 0.77%
I5 . Property Trust of America(Seahawk Apts.) Apartments 6,880,940 0.73%
I6 . Hausman-Banfield Interests Apartments;Commercial 5,630,640 0.60%
7 . Frontier Land VPLL(Salem Square) Apartments 3,299,500 0.35%
I8 . Houston Lighting&Power Utility Company 3,151,810 0.33%
I9 . H.U.D.Multi Family Homes Apartments 2,910,450 0.31%
10 . Bellaire Capital Partnership(Kroger 2351) Shopping Center 2,884,580 0.31%
1 69,195,940 7.35%
IAll other taxpayers 872,483,292 92.65%
ITotals $ 941,679,232 100.00%
ISource-Tax assessor/collector's records.
I
I
1
1 97
1
REVENUE BOND COVERAGE
Last Ten Fiscal Years
3
Operating Net Operating
Number Number Expenses Revenue
Fiscal of Water of Sewer Operating Before Available for
Year Customers Customers Revenue Depreciation Debt Service
1988 6,626 6,432 $ 3,071,181 $ 1,526,297 $ 1,544,884 I
1989 6,731 6,539 3,034,892 1,443,986 1,590,906
1990 6,968 6,719 3,472,772 1,597,064 1,875,708 I
1991 7,336 6,983 3,378,322 1,857,809 1,520,513 I
1992 7,521 7,171 3,567,379 2,063,694 1,503,685
1993 7,781 7,475 3,808,566 2,246,969 1,561,597 I
1994 8,031 7,709 3,896,444 2,305,953 1,590,491 I
1995 8,210 7,878 4,394,289 2,135,227 2,259,062
1996 8,382 8,043 4,995,119 2,730,719 2,264,400 I
1997 8,534 8,199 4,744,557 2,802,914 1,941,643
I
Note A- The amounts only include Revenue bonds and do not include amounts paid by
the Enterprise Fund for Combination Tax and Revenue Bonds which are
secured by Tax Revenues
Source- Accounting records of the City.
II
I
I
I
98 i
I
1 Table 8
I
Revenue Bond
IDebt Service Requirements
Principal Interest Total Coverage
I $ 125,000 $ 69,720 $ 194,720 7.93
125,000 61,900 186,900 8.51
1 130,000 56,275 186,275 10.07
I130,000 46,906 176,906 8.60
135,000 38,916 173,916 8.65
135,000 31,022 166,022 9.41
I135,000 25,710 160,710 9.90
140,000 15,581 155,581 14.52
111 45,000 10,244 55,244 A 40.99
I45,000 7,503 52,503 36.98
I
I
I
I
I
I
I99
I
CITY OF FRIENDSWOOD, TEXAS
RATIO OF NET GENERAL BONDED DEBT TO ASSESSED
VALUE AND NET BONDED DEBT PER CAPITA
Last Ten Fiscal Years
I
Fiscal Year
Ended Assessed Gross
Sept.30, Population Value Bonded Debt
1988 22,500 $ 763,454,517 $ 9,405,778
1989 23,500 729,914,210 8,750,778
1990 22,710 759,841,760 8,080,778
1991 22,814 761,569,171 7,365,778
1992 25,680 806,261,160 6,575,778
1993 26,333 781,187,783 9,061,649
1994 27,356 825,111,643 8,160,895
1995 27,700 869,085,848 4,776,263 (1) 1
1996 28,602 911,351,022 3,935,477
1997 28,902 941,679,232 3,606,427 1
Source-Tax assessor/collector and accounting records of the City. I
(1) Reflects reallocation of debt to Enterprise Funds in 1994-95 in the amount of$2.5 million.
I
1
I
I
I
I
1
100 1
I
1 Table 9
I
IRatio of Net
Less Debt Bonded Debt Net Bonded
I Service Net to Assessed Debt
Funds Bonded Debt Value Per Capita
I $ 325,894 $ 9,079,884 1.19% $ 404
280,793 8,469,985 1.16% 360
I 57,308 8,023,470 1.06% 353
50,854 7,314,924 0.96% 321
78,244 6,497,534 0.81% 253
I45,501 9,016,148 1.15% 342
47,281 8,113,614 0.98% 297
I56,968 4,719,295 0.54% (1) 170
298,053 3,637,424 0.40% 127
I392,220 3,214,207 0.34% 111
I
I
I
I
I
I
I
I101
RATIO OF ANNUAL DEBT SERVICE EXPENDITURES Table 10
FOR GENERAL BONDED DEBT
TO TOTAL GENERAL EXPENDITURES
Last Ten Fiscal Years
Ratio of
Interest Total Debt Total Debt Service
Fiscal and Fiscal Service General Requirements
Year Principal Charges Requirements Expenditures to ExpendituresI
1988 $ 690,323 $ 654,370 $ 1,344,693 $ 6,614,293 20.33%
1989 687,029 618,699 1,305,728 6,645,694 19.65%
1990 721,245 583,352 1,304,597 7,163,992 18.21%
1991 763,192 538,736 1,301,928 7,726,061 16.85%
1992 830,000 485,242 1,315,242 8,440,480 15.58%
1993 945,000 489,052 1,434,052 8,726,615 16.43%
1994 960,000 433,270 1,393,270 9,376,365 14.86%
1995 910,000 358,551 1,268,551 10,179,395 12.46%
1996 963,272 238,920 1,202,192 10,091,694 11.91%
1997 899,000 74,901 973,901 10,923,662 8.92%
I
I
I
I
I
I
I
102 1
I
CITY OF FRIENDSWOOD, TEXAS
ICOMPUTATION OF DIRECT AND OVERLAPPING DEBT Table 11
September 30, 1997
I
I Percentage
Applicable City of
Net Debt Outstanding to City of Friendswood's
I
Name of Governmental Unit Outstanding as of Friendswood Share of Debt
Friendswood Independent
I
School District $ 12,130,503 08/31/97 100.00 % $ 12,130,503
Clear Creek Independent
School District 185,257,008 08/31/97 3.94 7,299,126
I
Galveston County 34,448,000 12/31/96 5.68 1,956,646
1 Harris County 2,235,827,000 2/28/96 0.15 3,353,741
Harris County Flood
I
Control District 228,198,000 2/28/96 0.15 342,297
Port of Houston Authority 114,322,000 2/28/96 0.15 171,483
I
I
Total Net Overlapping Debt 25,253,796
City of Friendswood 3,214,207
I
Total Net Direct and Overlapping Debt $ 28,468,003
I
I
1
I
I
I
1 103
3
CITY OF FRIENDSWOOD,TEXAS
DEMOGRAPHIC STATISTICS Table 12 3
Last Ten Fiscal Years
I
Fiscal Per Capita Median Unemployment I
Year Population Income Age Rate(A)
1988 22,500 29,743 29.7 6.8 % I
1989 23,500 20,409 32.9 6.4
1990 22,710 N.A. N.A. 5.0
1991 22,814 N.A. N.A. 7.4 I
1992 25,680 N.A. N.A. 8.9
1993 26,333 N.A. N.A. 7.6
1994 27,356 N.A. N.A. 7.8
1995 27,700 N.A. N.A. 7.8
1996 28,602 N.A. N.A. 3.7 (B)
1997 28,902 N.A. N.A. 2.9
N.A.-Not Available
(A) Source-Texas Employment Commission
(B) For the year 1996 the unemployment rate is for the City of Friendswood.For years prior to 1996 the rate I
was for Galveston County since rates were not available for the City of Friendswood.
I
I
I
I
I
104 1
I
CITY OF FRIENDSWOOD,TEXAS
PROPERTY VALUE AND CONSTRUCTION Table 13
Last Ten Fiscal Years
I
I Fiscal Year Property
Value Construction
I 1988 $ 763,454,517 $ 19,712,294
1989 729,914,210 14,998,749
1990 759,841,760 37,068,554
1991 761,569,171 46,975,722
1992 806,261,160 63,126,050
1993 781,187,783 61,604,061
1 1994 825,111,643
869,085,848 64,653,799
1995 34,680,410
1996 911,351,022 42,440,747
1997 941,679,232 41,528,406
1
I
I
Source:City's Permits Department.
I
i
e
105
CITY OF FRIENDSWOOD, TEXAS
REQUIRED SUPPLEMENTARY INFORMATION
TEXAS MUNICIPAL RETIREMENT SYSTEM
ANALYSIS OF FUNDING PROGRESS
Last Ten Calendar Years
I
Plan Net Assets Pension Unfunded
Calendar Available Benefit Percentage Pension
Year for Benefits Obligation Funded ObligationI
1987 $ 1,265,501 $ 1,632,280 77.5% $ 366,779
1988 1,582,085 1,878,557 84.2% 296,472
1989 1,866,216 2,204,025 84.7% 337,809
1990 2,223,461 2,978,946 74.6% 755,485
1991 3,323,037 3,606,837 92.1% 283,800
1992 3,954,115 4,245,973 93.1% 291,858
1993 4,547,707 5,418,187 83.9% 870,480
1994 5,190,936 5,862,152 88.6% 671,216
1995 5,838,306 6,559,465 89.0% 721,159 I
1996 6,820,691 7,531,703 90.6% 710,742
I
I
I
I
I
I
I
I
I
106
I
I
Table 14
I
I
Unfunded
I
Pension
Benefit as a
Annual Percentage City Average
I
Covered Payroll of Covered Contribution City
Payroll to TMRS Rate
$ 2,516,687 14.6% $ 85,739 3.4%
I
2,615,976 11.3% 86,290 3.3%
2,617,976 12.9% 97,716 3.7%
2,955,563 25.6% 171,244 5.8%
I
3,051,394 9.3% 210,370 6.9%
3,339,878 8.7% 208,440 6.2%
3,469,512 25.1% 207,130 6.0%
I 3,892,013 17.2% 257,192 6.6%
4,150,533 17.4% 284,653 6.9%
4,455,830 16.0% 324,151 7.3%
I
I
I
I
I
I
I
107
2
CITY OF FRIENDSWOOD, TEXAS
SCHEDULE OF IMPACT FEE PROJECT CHANGES 3
Year Ended September 30, 1997
I
South South
Friendswood Friendswood
Surface Water Service Area Service Area
Facilities Water Wastewater
Improvements Improvements Improvements
Increases
Impact fees $ 185,066 $ 12,892 $ 27,323
Interest 3,444 239 625
188,510 13,131 27,948
Decreases
Improvements:
Manhole rehabilitation
Transfer for Debt Service
Payments:
1988 Certificate of Obligation 150,032
1992 Certificate of Obligation 41,537 1
1995 Refunding Bonds 15,902
150,032 15,902 41,537
Net Increase(Decrease) 38,478 (2,771) (13,589)
I
Balance,beginning of year 40,333 2,771 13,589
I
Balance,End of Year $ 78,811 $ $
I
Source- Citysubsidiaryrecords trackingproject information regarding impact fees received by the
Enterprise Fund. Impact fees are recorded as additions to contributed capital in the Enterprise
Fund. I
(1 Interest allocated on percentage of beginning equity and impact fee revenues.
I
108 1
' Table 15
I
7 Other
Water and
' Wastewater
Improvements Totals
$ 31,060 $ 256,341
509 4,817
' 31,569 261,158
' 25,627 25,627
150,032
41,537
15,902
25,627 233,098
5,942 28,060
2,230 58,923
$ 8,172 $ 86,983
1
I
r109
4
CITY OF FRIENDSWOOD, TEXAS
MISCELLANEOUS STATISTICAL DATA Table 16
September 30, 1997 Page 1 of 2
�.a
Date of incorporation October 15, 1960
Date of present charter Adopted Home Rule Charter
October 16, 1971
Form of government Council-Manager
Area 22.70 square miles
Miles of Streets
Streets-Paved 111.95 miles
Streets-Unpaved 2.12 miles
I
Fire Protection
Number of stations 3 1
Number of employees (Full-time equivalent) 6.00
Number of volunteers 98
I
Fire Prevention
Number of employees(Full-time equivalent) 2.80
Number of volunteers -
Police Protection 111
Number of stations 1
Number of sworn officers(Full-time equivalent) 38.48
Number of patrol units 12
Recreation
Number of parks 6
Size of parks 110.5 acres
Number of golf courses -
Number of swimming pools 1
Number of tennis courts 4
Miles of storm sewers 84.74 miles
110 1
CITY OF FRIENDSWOOD, TEXAS
3 MISCELLANEOUS STATISTICAL DATA Table 16
September 30, 1997 Page 2 of 2
Education
Friendswood Independent School District:
Number of teachers 340
Number of students 4,517
Clear Creek Independent School District:
Number of teachers 1,600
Number of students 27,600
City Employees
Department heads 6
Employees:
Full-time 120.00
Part-time(Full-time equivalent) 28.03
Total 154.03
I
Election
Number of Votes Cast:
Last City Election-Regular Election 2,075
Water
Source Ground Water Surface Water
Average daily consumption 1,144,799 gallons 2,437,683 gallons
Maximum daily consumption 3,595,000 gallons 4,093,000 gallons
Water mains 115 miles
Number of connections 8,382
Sewer Blackhawk
Average daily flow 2,635,478 gallons
Maximum daily flow 8,699,000 gallons
Sanitary sewer mains 115 miles
Number of connections 8,043
1
1
I
' 111