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Home My WebLink About1975 03 31 Single Audit Report - Harris county water control and improvement district No. 108 wmm --ooOoo-- AUDIT REPORT HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 HARRIS COUNTY, TEXAS -o- MARCH 31 , 1975 --ooOoo-- vimmin --ooOoo-- C O N T E N T S Exhibit Schedule ACCOUNTANTS' REPORT COMBINED BALANCE SHEET, ALL FUNDS A CERTIFICATES OF DEPOSIT AL1 REVENUES, EXPENSES AND FUND BALANCE, OPERATING FUND B REVENUES, EXPENSESTAX E S, AND FUND BALANCE, T FUND C TAXES RECEIVABLE C-1 REVENUES, EXPENSES AND FUND BALANCE, DEBT SERVICE FUND D BOND INTEREST RESERVE D-1 RECEIPTS AND DISBURSEMENTS, ALL FUNDS E GENERAL LONG-TERM DEBT AND DEBT SERVICE REQUIREMENTS F GENERAL FIXED ASSETS G DISTRICT ORGANIZATIONAL COSTS H NOTES TO FINANCIAL STATEMENTS I --ooOoo-- vMOMMO WHITE, PETROV & MCHONE CERTIFIED PUBLIC ACCOUNTANTS ROBERT A.WHITE 600 JEFFERSON SUITE 1150 JOSEPH W.PETROV HOUSTON.TEXAS 77002 ROBERT W.MCHONE TELEPHONE (713) 224-7758 STEPHEN H.CORDILL,JR. August 12, 1975 JOHN B.MANTHEY MEMBERS AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS Board of Directors Harris County Water Control and Improvement District No. 108 Harris County, Texas We have examined the combined balance sheet, all funds, of HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 as of March 31 , 1975, and the related statements of revenues, expenses and fund balances for the year then ended. Our examination was made in accordance with generally accepted auditing standards, and accordingly included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. The District is in the developmental stage and construction of the fixed moommerr assets is not complete at the balance sheet date. In accordance with the suggestions of the Texas Water Rights Commission, the District did not depreci- ate its general fixed assets. We observed no departures by the District from the requirements of the bond orders except as described in detail in note 10 of the notes to financial statements. In our opinion, subject to the outcome of the lawsuit as discussed in note 14 of the notes to financial statements, the accompanying combined balance sheet, all funds, and the related statements of revenues, expenses and fund balances present fairly the financial position of HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 as of March 31 , 1975, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles applied on a basis consistent with that of the preceding year. The supplementary information contained in this report has been subjected to the tests and other auditing procedures applied in the examination of the financial statements mentioned above, and, in our opinion, is fairly stated in relation to the financial statements taken as a whole. ‘eZde4 CA‘4 a Jirommaignow Our certificate or report upon en audit or examination is delivered to client with the understanding that any publication, advertisement, or copy therefrom, in full or in part, of such certificate or report, shall be in the form to be approved by us. Exhibit A ww� COMBINED BALA) HAPR|S COUNTY WATER CONTROL MARC General General :ruction Long-Term Fixed .und Debt Assets ASSETS Cash /Ol Certificate of Deposit, Schedule A- Accrued Interest Receivable, SchedL Accounts Receivable, Water and Sewe Accounts Receivable, Other Taxes Receivable, Schedule C-1 Prepaid Coupon Interest on Bonds, K Prepaid Insurance Prepaid Tap Expense Due From Other Funds ) 461 General Fixed Assets, Exhibit G l 963 158 District Organizational Costs, ExhY 782 796 Amount to be Provided to Retire Gan 2 800 OOU ' TOTAL ASSETS 162 2 800 000 2 744 954 LIABILITIES, RESERVES AND FUND BALAN[ Liabilities Accounts Payable 893 Customer Deposits Due to Other Funds 223 Bonds Payable, Exhibit F 2 800 OOO Total Liabilities 116 2 800 000 -o- Raservms and Fund Balances Reserve For Uncollected Taxes Authorized Construction 046 Investment in General Fixed Ass 2 744 954 Fund Balances Total Reserves and Fund Hat 046 -o- 2 744 954 ' TOTAL LIABILITIES, RESERVES 162 2 800 UDU 2 744 954 "Noftowww" The NOTES TO FINANCIAL STATEMENTS Schedule A-1 .rri CERTIFICATES OF DEPOSIT HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 MARCH 31 , 1975 Accrued Interest Interest Maturity Face Receivable Rate Date Amount March 31 , 1975 Debt Service Fund Certificate of Deposit No. 1515 8.25% 9/22/75 103 000 1 275 vularimmr rs2111ranr The NOTES TO FINANCIAL STATEMENTS are an integral part of this report. Exhibit B r REVENUES, EXPENSES AND FUND BALANCE, OPERATING FUND HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 FOR THE YEAR ENDED MARCH 31 , 1975 OPERATING REVENUES Water Services , Note 6 59 382 Sewer Services , Note 6 33 898 Garbage Services 7 334 Sewer Inspections 730 Late Charges 3 264 Reconnections 190 TOTAL OPERATING REVENUES 104 798 OPERATING EXPENSES Paying Agent Fee 662 Bookkeeping Fees 750 Insurance 315 Audit Fee 1 400 Garbage Expense 8 342 • Legal Fees 6 085 Monthly Services 18 '750 "moBow Office Supplies .1 502 Repairs and Maintenance 11 096 Utilities 3 344 �1pk,r� Sewer Service Expense, Note 13 �7 303 ruDIcaI:Or,jL 3G1 Sewer Inspection Expense 520 /� Directors' Per D i ems 1 10 E/ec d" );4"c". 3S o Bad Debt Expense 1 064 Ptemtor oov,&OHfO Riau" Other 475 TOTAL OPERATING EXPENSES 82 708 NET OPERATING REVENUES 22 090 OTHER REVENUES (EXPENSES) Water Tap Fees 21 508 Water Tap Expense (12 940) 8 568 NET REVENUE FOR THE PERIOD, Note 5 30 658 FUND BALANCE, APRIL 1 , 1974 ( 6 730) Transfers to Debt Service Fund ( 48 500) FUND BALANCE, MARCH 31 , 1975 ( 24 572) The NOTES TO FINANCIAL STATEMENTS are an integral part of this report. Exhibit C vimmos REVENUES, EXPENSES AND FUND BALANCE, TAX FUND HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 FOR THE YEAR ENDED MARCH 31 , 1975 REVENUES Taxes Collected 180 411 Penalty and Interest 1 289 TOTAL REVENUES 181 700 EXPENSES Tax Assessor-Collector Fees 4 999 Board of Equalization 100 Legal Fees 225 Fidelity Bond 25 Other 484 TOTAL EXPENSES 5 833 NET REVENUES FOR THE YEAR, Note 5 175 867 FUND BALANCE, APRIL 1 , 1974 8 053 Transfers to Debt Service Fund (164 000) FUND BALANCE, MARCH 31 , 1975 19 920 AMMONIUM The NOTES TO FINANCIAL STATEMENTS are an integral part of this report. Schedule C-1 immumm TAXES RECEIVABLE HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 MARCH 31 , 1975 Taxes Receivable, April 1 , 1974 8 858 Adjustments ( 445) Adjusted Taxes Receivable, April 1 , 1974 8 413 1974 Original Tax Roll 179 975 Additions and Corrections ( 2 752) Adjusted 1974 Tax Roll 177 223 Total to be Accounted For 185 636 Tax Collections: Current Year 173 489 Prior Years 6 922 180 411 Taxes Receivable, March 31 , 1975 5 225 Taxes Receivable by Years 1974 3 734 1973 844 1972 609 1971 23 1970 15 Total Taxes Receivable 5 225 Property Valuations 1974 1973 1972 1971 Land 4 292 700 4 357 850 3 946 313 2 023 822 Improvements 15 189 780 9 769 390 4 975 675 1 816 375 Personal Property 209 040 150 550 75 820 -o- Total Valuations 19 691 520 14 277 790 8 997 808 3 840 197 v" axwi Tax Rate Per $100 Valuation 0.90 0.90 0,75 0.45 The NOTES TO FINANCIAL STATEMENTS are an integral part of this report. Exhibit D Amminim REVENUES, EXPENSES AND FUND BALANCE, DEBT SERVICE FUND HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 FOR THE YEAR ENDED MARCH 31 , 1975 REVENUES Appropriation . From Bond Interest Reserve, Schedule D-1 , Note 3 29 946 Interest Earned on Certificates of Deposit 10 877 Transfers From Tax Fund 164 000 Transfers From Operating Fund 48 500 TOTAL REVENUES 253 323 EXPENSES #-- Bond Interest 268 645 NET EXPENSES FOR THE YEAR ( 15 322) FUND BALANCE, APRIL 1 , 1974 237 329 FUND BALANCE, MARCH 31 , 1975 222 007muMMEMMIS The NOTES TO FINANCIAL STATEMENTS are an integral part of this report. Schedule D-1 BOND INTEREST RESERVE HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 MARCH 31 , 1975 Bond Interest Reserve, April 1 , 1974 29 946 Deductions: Appropriation For Bond Coupon Interest, Note 3 $530,000 Series 1972 29 946 Bond Interest Reserve, March 31 , 1975 -o- The NOTES TO FINANCIAL STATEMENTS are an integral part of this report. Exhibit E RECEIPTS AND DISBURSEMENTS, ALL FUNDS HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 FOR THE YEAR ENDED MARCH 31 , 1975 Debt Operating Tax Service Construction Fund Fund Fund Fund RECEIPTS Operating Income 106 204 Water Tap Income 21 508 Penalty and Interest Income 1 289 Taxes Collected 180 411 Redemption of Certificates of Deposit 245 015 Overpayments 3 000 Interest Received on Certifi- cates of Deposit 11 117 Transfers From Other Funds 212 500 Reimbursement of Repairs Expense 260 Other 132 Reimbursement of Due From Other Funds 4 611 TOTAL RECEIPTS 131 104 181 700 468 632 4 611 DISBURSEMENTS Operating Expenses 65 634 5 833 Bond Coupon Interest , Note 11 251 813 Construction of Fixed Assets 5 642 Payment of Prior Year Accounts Payable 8 571 542 Refund of Overpayments 3 000 Reimbursement of Due to Other Funds 4 611 Purchase of Certificates of Deposit 233 015 Reimbursable Payments for Other Funds 925 13 964 Tap Construction Expense 120 Transfer to Debt Service Fund 48 500 164 000 Prepaid Tap Expenses 580 TOTAL DISBURSEMENTS 131 941 169 833 484 828 20 148 EXCESS OF RECEIPTS OVER (UNDER) DISBURSEMENTS ( 837) 11 867 ( 16 196) (15 537) CASH BALANCE, APRIL 1 , 1974 22 329 8 286 16 214 31 238 iginimw CASH BALANCE, MARCH 31 , 1975 21 492 20 153 18 15 701 The NOTES TO FINANCIAL STATEMENTS are an integral part of this report. Exhibit F Page 1 of 2 111111111111111111 GENERAL LONG-TERM DEBT HARRIS COUNTY WATER CONTROI MARI Debt Service Requirements For The Year Ending For The Year Ending March 31 , 1976 March 31 , 1977 Description Principal Interest Principal Interest Harris County Water Control and Imprc District No. 108 Waterworks and Se% System Combination Tax and Revenue Series 1970A 30 945 5 000 30 945 Harris County Water Control and Imprc District No. 108 Waterworks and Se% "'merwmar— System Combination Tax and Revenue Refunding Bonds, Series 1971 60 000 5 000 59 806 Harris County Water Control and Imprc District No. 108 Waterworks and Sep System Combination Tax and Revenue Series 1971A 96 337 20 000 95 612 Harris County Water Control and Imprc District No. 108 Waterworks and Se% System Combination Tax and Revenue Series 1972 47 700 5 000 41 569 imeimums TOTALS, Notes 5, 8 and 12 -o- 234 982 35 000 227 932 The NOTES TO FINANCIAL STATEMENT! Exhibit F m,NN.MIII Page 2 of 2 GENERAL LONG-TERM DEBT AND DEBT SERVICE REQUIREMENTS HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 MARCH 31 , 1975 Principal Principal Interest Interest Total For The Years Due Due Due Due Annual Ending March 31 , April 1 October 1 April 1 October 1 Requirements 1976 117 491 117 491 234 982 1977 30 000 5 000 117 491 110 441 262 932 1978 30 000 5 000 110 229 109 141 254 370 1979 30 000 10 000 108 929 101 028 249 957 1980 35 000 10 000 100 603 99 398 245 001 1981 45 000 10 000 98 973 97 341 251 314 1982 45 000 10 000 96 916 95 285 247 201 1983 50 000 10 000 94 860 93 048 247 908 1984 50 000 15 000 92 623 90 810 248 433 1985 60 000 15 000 90 173 87 985 253 158 1986 60 000 15 000 87 347 85 160 247 507 1987 70 000 15 000 84 523 81 985 251 508 1988 75 000 15 000 81 385 78 654 250 039 ,...•;— 1989 80 000 15 000 78 054 75 141 248 195 1990 90 000 15 000 74 541 71 191 250 732 1991 95 000 15 000 70 591 67 073 247 664 1992 105 000 15 000 66 442 62 543 248 985 1993 110 000 15 000 61 912 57 825 244 737 1994 120 000 20 000 57 195 52 645 249 840 1995 130 000 20 000 51 805 46 892 248 697 1996 140 000 20 000 46 052 40 753 246 805 1997 160 000 20 000 39 912 33 913 253 825 1998 175 000 20 000 33 073 26 516 254 589 1999 195 000 20 000 25 676 18 370 259 046 2000 220 000 20 000 17 530 9 305 266 835 2001 230 000 20 000 8 465 840 259 305 TOTALS 2 430 000 370 000 1 912 791 1 810 774 6 523 565 Animmimi The NOTES TO FINANCIAL STATEMENTS are an integral part of this report. Exhibit G immom GENERAL FIXED ASSETS HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 MARCH 31 , 1975 Balances Balances April 1 , 1974 Additions March 31 , 1975 Drainage System 623 214 623 214 Sewer System 711 810 922 712 732 Water System 443 538 6 840 450 378 Engineering 174 159 174 159 Land 1 675 1 675 TOTAL, Notes 9 and 10 1 954 396 7 762 1 962 158 Additions Provided By Construction Fund Disbursed 5 642 Operating Fund (Reimbursable) Disbursed 750 Accrued 1 370 2 120 Total Amount Provided 7 762 ammonium The NOTES TO FINANCIAL STATEMENTS are an integral part of this report. Exhibit H mimmor DISTRICT ORGANIZATIONAL COSTS HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 MARCH 31 , 1975 Balances Balances April 1 , 1974 Additions March 31 , 1975 Directors' Per Diems 4 925 4 925 Bond Coupon Interest, Note 3 491 061 29 946 521 007 Legal Fees 127 688 127 688 Fiscal Advisory Fees 44 000 44 000 Bond Discount 79 154 79 154 Publication of Legal Notices 2 516 2 516 Creation of District 1 123 1 123 Bond Printing Expense 1 560 1 560 Election Expense 616 616 Other 207 207 wwwariar— TOTAL, Note 4 752 850 29 946 782 796 Additions Provided By Debt Service Fund 29 946 mummomm The NOTES TO FINANCIAL STATEMENTS are an integral part of this report. Exhibit I Page 1 of 4 NOTES TO FINANCIAL STATEMENTS HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 MARCH 31 , 1975 Note 1 : Creation of District Harris County Water Control and Improvement District No. 108 was created by an order of the Texas Water Rights Commission effective October 22, 1968. The Board of Directors held its first meeting on November 7, 1968, and the first bonds were sold on August 31 , 1970. Note 2: Accounting Methods The exhibits and supporting schedules contained in this report were prepared on the accrual method of accounting except for Exhibit C which was prepared on the modified accrual method and Exhibit E which was prepared on the cash basis. Note 3: Bond Interest Reserve In accordance with Section VIII of the Bond Orders, a portion of the bond proceeds was deposited into the debt service fund and reserved ...••�� for the payment of bond interest during the construction period. This bond interest was being capitalized as a district organizational cost as it was paid and the reserve account reduced accordingly. Note 4: District Organizational Cost The District has elected to capitalize and charge to district organizational costs all costs incurred in the issue and sale of bonds, costs of creating and organizing the District and some administrative costs until construction of fixed assets is completed. Note 5: Pledge of Tax and Operating Revenue The bonds are payable from the proceeds of an ad valorem tax levied upon all taxable property subject to taxation within the District, without limitation as to rate or amount, and are further payable from and secured by a lien on and pledge of the net revenues to be received from the operation of the District 's waterworks and sanitary sewer system. • • Exhibit I Page 2 of 4 ,ram NOTES TO FINANCIAL STATEMENTS HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 MARCH 31 , 1975 Note 6: Water and Sewer Service Rates The District has established the following water and sewer service rates: Residential and Commercial Combined Water and Sewer Service First 5,000 Gallons of Water Used (Minimum Bill )* 8.75 Each 1 ,000 Gallons of Water Used Thereafter .70 Water Service Only First 5,000 Gallons of Water Used (Minimum Bill ) 5.00 Each 1 ,000 Gallons of Water Used Thereafter .45 Sewer Service Only First 50,000 Gallons of Water Used (Minimum Bill ) 3.75 Each 1 ,000 Gallons of Water Used Thereafter .25 * Master metered townhouses are based on first 5,000 gallons of water used times the number of units. Note 7: Water and Sewer Service Customers The following is a comparison of the number of metered water and sewer service customers serviced by the District: March 31 , 1972 220 March 31 , 1973 383 March 31 , 1974 654 March 31 , 1975 838 Note 8: Redemption of Bonds The outstanding bonds of Harris County Water Control and Improvement District No. 108 are callable for redemption prior to maturity at the option of the District. The bonds may be called in whole or in part for the purpose of retirement or refunding, or both, at par in addition to unpaid accrued interest. Bonds of the Series 1970A, 1971 , 1971A and 1972 may be called on October 1 , 1985, April 1 , 1985, April 1 , 1986 and April 1 , 1987, respectively, or any interest date thereafter. Exhibit I Page 3 of 4 NOTES TO FINANCIAL STATEMENTS HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 MARCH 31 , 1975 Note 9: Insurance Coverage Bond Order dated March 3, 1970, Section X, Paragraph E, requires that as long as any of the bonds are outstanding, the District will maintain insurance on its facilities for the benefit of bondholders of a type and in an amount which usually would be carried by private companies engaged in a similar type of business. At the balance sheet date the District carried the following insurance: Insurer: National Standard Insurance Co. Policy Number: 7314614 Policy Period: November 12, 1973 to November 12, 1976 Amount of Coverage: $170,000 (80% Coinsurance) Type of Coverage: Fire and Lightning, Extended Coverage, Vandalism and Malicious Mischief Description of Property: Water and Sewer Plants Insurer: Maryland American General Policy Number: LS 49509903 Policy Period: November 22, 1974 to November 22, 1975 ,,.....•— Amount of Coverage: $300,000 (Bodily Injury) , $25,000 (Property Damage) Type of Coverage: Manufacturer' s and Contractor' s Liability Note 10: Engineering Report The Bond Order dated March 3, 1970, Section X, Paragraph I , states that a complete engineering inspection report of the operations and physical conditions of the plant and system shall be made each year by an independent qualified engineer. At the balance sheet date said report had not been made. Note 11 : Prepaid Coupon Interest Coupon interest in the amount of $117,491 , was transmitted to the bond paying agent in March, 1975, for the interest due April 1 , 1975. Note 12: Supplemental Coupons All bonds of the Series 1971A have supplemental coupons attached so that the total interest paid on each bond shall be 10% per annum from October 1 , 1971 to October 1 , 1974. All bonds of the Series "'1.1.1.11=1•1 1971 Refunding Bonds have supplemental coupons attached so that the total interest paid on each bond will be equal to ten per cent (10%) per annum from October 1 , 1973 to April 1 , 1978. Bonds of the Series 1972 maturing in the years 1982 through 2000, aggregating $490,000, have supplemental coupons attached so that the total interest paid on each bond shall be nine per cent (9%) per annum from June 1 , 1972 to April 1 , 1976. Exhibit I """'r Page 4 of 4 NOTES TO FINANCIAL STATEMENTS HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 MARCH 31 , 1975 Note 13: Contract With City of Friendswood On October 19, 1971 , the District entered into a waste disposal contract with the City of Friendswood , Texas. Under the terms of this contract, the District constructed lines and facilities to transport waste to the sanitary sewer trunk line facilities of the City. Also, on March 30, 1972, the District paid the City $239,000 for expansion and improvement of the City's sewage treatment facilities to meet all state and federal regulations. Under this contract the District is entitled to have up to 460,000 gallons per day treated by the City. The City is responsible for all maintenance and operation of the plant. As of June 15, 1972, the District must pay $3.00 per connection, per month for sewer treatment service. Note 14: Subsequent Litigation Subsequent to March 31 , 1975 the District was named as a party defendant in a law suit which alleged damages to the plaintiff's property in the „i...,...-_ amount of $600,000 due to alleged infractions concerning water control in the stream known as Clear Creek. This law suit is pending as of the date of this report and the outcome is uncertain.