HomeMy WebLinkAbout1985 03 31 Single Audit Report - Harris county water control and improvement district No.108 (2) U
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
HARRIS COUNTY, TEXAS
FINANCIAL STATEMENTS AND AUDITORS REPORT
March 31 , 1985
VAN SAHAKIAN
Certified Public Accountant
Houston,Texas
• i
VAN SAHAKIAN
Certified Public Accountant 2400 Lazy Hollow Or., Suite 139
Houston, Texas 77063
May 8 , 1985
To The Board of Directors of
Harris County Water Control and Improvement District No. 108
I have examined the combined balance sheets - all fund
types and account groups of Harris County Water Control and
Improvement District No. 108 as of March 31 , 1985 , and the
related statement of combined revenues, expenditures and
changes in fund balances - all governmental fund types, for
the year then ended. My 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 I considered necessary in the circum-
stances.
In my opinion, the statements referred to above present
fairly the financial position of Harris County Water Control
and Improvement District No. 108 at March 31 , 1985 , and the
results of its operations for the year then ended, in con-
formity with generally accepted accounting principles, applied
on a basis consistent with that of the preceding year.
An..�
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 10H
COMBINED BALANCE SHEETS - ALL FUND TYPES AND ACCOUNT GROUPS
March 31, 1985
Totals
Governmental Fund Types Account Groups (Memorandum Only)
Debt Capital General
Service Projects General Fixed Long-Term March 31, March 31,
General Fund Fund Fund Assets Debt 1985 1984
ASSETS
Cash $ 31,237 $ 17,853 $ 99 $ 49,189 $ 46,490
Time deposits 191,380 201,044 8,432 400,856 465,13E
Receivables -
Accounts 29,716 29,716 34,393
Taxes 35,224 35,224 26,595
Accrued interest 265 157 52 474 936
Prepaid expenses 4,285 4,285 2,34E
Land $ 1,675 1,675 1,675
Water system 716,827 716,827 716,827
Sewage system 734,252 734,252 734,252
Drainage system 562,735 562,735 562,735
Engineering costs 174,159 174,159 174,159
Office building 107,949 107,949 107,178
Furniture and fixtures 7,346 7,346 7,34E
Construction in progress 97,951 97,951 7,669
Amount available in Debt Service Fund $ 218,897 218,897 202,561
Amount to be provided for retirement
of long-term debt 2,236,103 2,236,103 2,332,439
Total assets $256,883 $254,278 $8,583 $2,402,894 $2,455,000 $5,377,638 $5,422,739
LIABILITIES AND FUND EQUITY
Liabilities -
Accounts payable $ 19,741 $ 638 $ 20,379 $ 30,101
Refundable deposits 14,799 14,799 12,357
Undistributed refunds of purchased
sewer services 9,443 9,443 -
Deferred revenue:
Property taxes 35,224 35,224 26,595
General obligation bonds payable $2,455,000 2,455,000 2,535,000
Total liabilities 43,983 35,862 - - 2,455,000 2,534,845 2,604,053
Fund equity -
Investment in general fixed assets 2,402,894 2,402,894 2,311,841
Fund balances: 73,706 75,450
Reserve account - Series 1971 Bonds 73,706
Designated for debt service 144,710 144,710 127,339
Undesignated 212,900 8,583 221,483 304,05E
Total fund equity 212,900 218,416 8,583 2,402,894 - 2,842,793 2,818,68r,
Total liabilities and fund equity $256,883 $254,278 $8,583 $2,402,894 $2,455,000 $5,377,638 $5,422,73',
See notes to financial statement:
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
' COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCES - GOVERNMENTAL FUND TYPES
For The Fiscal Year Ended March 31, 1985
Totals
Governmental Fund Types (Memorandum Only)
Debt Capital Year Ended
Service Projects March 31, March 31,
General Fund Fund Fund 1985 1984
Revenues -
Water and sewer services $294,489 $294,489 $291,630
Taxes collected $268,601 268,601 266,759
Penalties and interest 30,466 24,497 $ 1, 537 56,500 48,843
Tap connection fees (net) 1,193 1,193 76,411
Miscellaneous revenues 2, 340 2, 340 542
Total revenues 328,488 293,098 1,537 623,123 684,185
Expenditures -
Current:
Purchased sewer services \aa 131,502 i, 131,502 ' 136,354
Contracted services 38,698 8,052 46,750 55,493
Professional fees 20, 352 20,352 16,554
Utilities iti 27,997 27,997 26,917
Repairs and maintenance ii 71,624 71,624 41,492
Other operating expenses 5 31,372 31, 372 22,319
Property assessment expense h`' 3,013 3,013 4,217
Miscellaneous expenses 1,541 1,541 652
Capital outlay 91,053 91,053 112,949
Debt service:
Principal payments 80,000 80,000 80,000
Interest paid 184,865 • r184,865 190,795
Total expenditures 321,545 277,471 91,053 690,069 687,742
Excess of revenues over
(under) expenditures 6,943 15,627 (89, 516) (66,946) (3, 557)
Other financing sources (uses)-
Operating transfers in 85,000 85,000 50,000
Operating transfers out (85,000) (85,000) (50,000)
Increase/(decrease) in
uncollected taxes - 3,695
Total other financing
sources (uses) (85, 000) - 85, 000 - 3,695
Excess of revenues and
other sources over (under)
expenditures and other uses (78,057) 15,627 (4, 516) (66,946) 138
Fund balances, March 31, 1984 290,957 229, 384 13,099 533,440 533,302
Reclassification of taxes
receivable to deferred revenue - (26, 595) - (26,595) -
Fund balances, March 31, 1984
as adjusted 290,957 202, 789 13, 099 506,845 533, 302
Fund balances, March 31, 1985 $212,900 $218,416 $ 8, 583 $439,899 $533,440
See notes to financial statements
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL - GENERAL FUND
For The Fiscal Year Ended March 31 , 1985
General Fund
Variance -
Favorable
Budget Actual (Unfavorable)
Revenues -
Water and sewer services $277, 918 $294 , 489 $ 16,571
Penalties and interest 31 , 140 30, 466 (674)
Miscellaneous revenues 1 , 542 2 , 340 798
Tap connection fees (net) - 1 , 193 1 , 193
Total revenues 310, 600 328 , 488 17, 888
Expenditures -
Current:
Purchased sewer services 127, 664 131 , 502 (3,838)
Contracted services 48 , 074 38, 698 9, 376
Professional fees 22, 168 20 , 352 1 ,816
Utilities 7 27 , 868 27, 997 ( 129)
Repairs and maintenance - 71 , 136 71 , 624 ! (488)
Other operating expenses 32 , 583 31 , 372 1 , 211
Total expenditures 329 , 493 321 , 545 7, 948
Excess of revenues over
(under) expenditures ( 18 , 893) 6 , 943 25 , 836
Other financing uses -
Operating transfers out - 85, 000 ( 85,000)
Excess of revenues over
(under) expenditures
and other uses ( 18 , 893) ( 78, 057) ( 59, 164)
Fund balance, March 31 , 1984 290 , 957 290 , 957 -
Fund balance, March 31 , 1985 $272 , 064 $212 , 900 $ ( 59 , 164)
See notes to financial statements
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
NOTES TO FINANCIAL STATEMENTS
March 31 , 1985
Note 1 : Creation of the District -
Harris County Water Control and Improvement District No. 108
was created by an order of the Texas Water Rights Commission on
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 : Summary of accounting policies -
The Texas Water Rights Commission (Texas Department of Water
Resources) adopted a "Water District Accounting Manual" in 1974 and
the use of the Manual by all water districts was required by the
Commission beginning January 1 , 1975; the District ' s accounts are
generally maintained in accordance with the Manual . The accrual
basis of accounting is followed by the District and all financial
statements were prepared on this basis. The basic financial state-
ments of the District conform to the requirements of Statement 1 of
the National Council on Governmental Accounting and in compliance
with the directives of the Texas Department of Water Resources.
All of the fixed assets of the District are included in the
general fixed assets group of accounts and are stated at cost. The
District has the policy of expensing currently any repairs or main-
tenance which do not extend the life of the assets or increase the
assets value. Depreciation is not provided in accordance with
accepted practice for non-enterprise funds .
Property taxes are reported as revenue in the fiscal year in
which they become available to finance expenditures of the fiscal
year; tax accounts receivable but not available are recorded as
deferred revenue.
Note 3 : Budgets -
Annual budgets are prepared for the General Fund and adopted by
the District ' s Board of Directors for management guidance of the
District ' s operations. Actual net revenues exceeded budgeted net
revenues by $25 , 836 representing principally the combination of the
favorable variance in total revenues of $17 , 888 and the favorable
variance in total expenditures of $7, 948 . The favorable variance in
revenues resulted from increased water consumption of approximately
9 million gallons offset in part by decreased sewer service revenues
occassioned by a decrease in sewer rate charges as discussed in Note
7. The favorable variance in contracted services of $9 , 376 , which
for the most part, resulted from an unexpected refund of $6 , 157 from
the District' s operator.
Note 4 : Pledge of revenues -
All of the District' s bonds are payable from the proceeds of an
NOTES TO FINANCIAL STATEMENTS (Continued)
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 water-
works and sanitary sewer system after deduction of reasonable costs of
administration, efficient operation, and adequate maintenance of the
District' s service facilities in the manner provided by Chapter 217,
Acts of the Regular Session of the 52nd Legislature of Texas, 1951 .
Note 5: Debt service requirements -
Series 1970A - 1971A - 1972 - 1981 Bonds:
The Bond Orders for the above named series of bonds require that
while said bonds or any part of the principal and interest thereof
are outstanding and unpaid, there shall be levied an ad valorem tax
upon all taxable property within the District sufficient in amount to
pay the interest on such bonds, together with an additional amount to
be placed in the sinking fund sufficient to redeem such bonds at their
maturity. At such time as the net revenues from operation of the sys-
tem, pledged to the payment of these bonds, together with money deriv-
ed from taxes may have accumulated a surplus ihP sinking fund equal_
to the sum to be required in the succeeding__year to pay the interest
and rinci l o__ t_ e c s obligations maturing—in that year, the
District ' s annual tax levies may be lowered to produce not less than
25% of the bond maturities for each succeeding year. Whenever the ac-
tual experience of three consecutive years demonstrates that the net
revenues are adequate to protect the maturities of the District ' s
obligations, the District ' s tax may be wholly abated, until further
experience demonstrates the necessity to again levy taxes to avoid
default in payments of the District' s obligations as they may mature.
Series 1971 Bonds:
The Bond Orders for the Series 1971 bonds require the establish-
ment of a Reserve Account-by setting out from the net revenues of the
system and paying into the Bond Fund (i .e. Debt Service Fund) a sum
equal to 20% of the total monthly principal and interest requirements
for the next succeeding maturity of principal and interest until said
fund shall consist of a sum equal to the total principal and interest
requirements forthe _next__succeedingyear; current interest and prin-
cipal requirements are to be deposited in equal monthly installments.
At March 31 , 1985 the Reserve Account contained the amounts required
by the Bond Orders.
Note 6: Redemption of bonds -
The outstanding bonds of the District are callable for redemption
prior to maturity at the option of the District. The bonds may be
called in whole or in part, in inverse numerical order , for the pur-
poses of retirement or refunding, or both, at par plus accrued inter-
est. Bonds of the Series 1970A, 1971 , 1971A, 1972 , and 1981 may be
called on October 1 , 1985 , April 1 , 1985 , April 1 , 1986 , April 1 , 1987
and April 1 , 1995 , respectively, or any interest payment date there-
after.
NOTES TO FINANCIAL STATEMENTS (Continued)
Note 7: Engineers report -
The Bond Orders of the Series 1971 bonds require a complete
engineering inspection and report of the operations and physical
condition of the system to be made each year by an independent
qualified engineer. During the fiscal year the District' s inde-
pendent engineer inspected the water system and reported favorably
on its condition.
Note 8: Contract with the City of Friendswood -
The District entered into a waste disposal contract with the City
of Friendswood, Texas in 1971 and under the terms of this contract the
District constructed lines and facilities to transport waste on the
City' s sanitary sewer trunk line facilities. Under this contract the
District is entitled to have up to 460 ,000 gallons per day treated by
the City with the City being responsible for all maintenance and oper-
ation of the plant. In 1980 , the District entered into another con-
tract with the City whereby 85% of the sewer service revenues of the
District is to be paid for waste disposal . The contract stipulates
that the sewer service charge to the District ' s customers is to be made
on the same basis used by the City of Friendswood to charge its cus-
tomers. Accordingly, the District charged its customers based on the
actual water usage each month, as did the City, and remitted 85% of
the revenue from those charges to the City. The District learned that
in 1980 the City changed the basis used to charge its customers and
the District has determined that their customers have been charged for
sewer services in excess of those charged by the City ar,d as a result
have overpaid the City for sewer services. The District changed its
basis for sewer service charges beginning with April 1 , 1984 to con-
form to the basis used by the City and filed a claim for refund of
overpayments aggregating $46, 199 of which $19 , 250 was received during
the fiscal year. These refunds are passed on to the District' s resid-
ential customers, when received, on the basis of $3 . 00 per customer
per month. At March 31 , 1985, customer refunds totaling $9 , 807 had
been made and undistributed refunds of $9, 443 have been included in
current liabilities .
Note 9: Insurance coverages -
The Bond Orders require that so long as any of the bonds are
outstanding, the District agrees to maintain insurance for the bene-
fit of the bondholders, of a kind and in an amount which would usually
be carried by private companies engaged in a similar type of business.
The insurance agent/consultant of the District has determined that the
insurance provision of the Bond Orders have been complied with in all
material respects.
NOTES TO FINANCIAL STATEMENTS (Continued)
Note 10 : Water and sewer rates and customers -
The following monthly water and sewer service rates are currently
in effect.
Water Service
Residential and commercial :
First 5, 000 gallons of water used (minimum bill ) * $6 . 00
Each 1 , 000 gallons of water used thereafter . 95
*Master metered townhouses and apartment projects
are based on first 5 , 000 gallons of water used
times the number of units.
Sewer Service
Residential and commercial :
First 3 ,000 gallons of water used (minimum bill ) * $7 .00
Each 1 , 000 gallons of water used thereafter . 90
*Master metered townhouses and apartment projects
are charged $8 . 00 for each unit.
Five year summary of customers at March, 31 :
1985 1984 1983 1982 1981
1 , 078 1 , 085 1 , 097 1 , 146 1 , 158
VAN SAHAKIAN
Certified Public Accountant 2400 Lazy Hollow Dr.. Suite 139
Houston. Texas 77063
May 8 , 1985
The Board of Directors
Harris County Water Control and
Improvement District No. 108
Friendswood, TX 77546
In my opinion, the accompanying information is stated
fairly in all material respects in relation to the combined finan-
cial statements taken as a whole, of Harris County Water Control
and Improvement District No. 108 for the year ended March 31 , 1985 ,
which are covered by my opinion presented in the first section of
this report. The accompanying information is supplemental to the
combined financial statements and is not essential for a fair pre-
sentation of the financial position and the results of its opera-
tions. My examination was made primarily for the purpose of form-
ing an opinion on the combined financial statements taken as a
whole, and included such tests of the accounting records from which
the supplementary information was compiled, and such other auditing
procedures as I considered necessary in the circumstances.
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
March 31 , 1985
X D. Notes Required by the Water District Accounting Manual
( Included in notes to the financial statements)
X E. Analysis of Changes in Cash and Temporary Investments
X F. General Long-Term Debt Service Requirements by Fiscal Years
X G. Analysis of Changes in General Long-Term Debt
X H. Schedule of Temporary Investments
X I . Analysis of Taxes Receivable
X J. Analysis of Organizational Costs
X K. Analysis of Changes in General Fixed Assets
L. Schedule of Notes Payable
X M. Comparative Schedule of Revenues and Expenditures - Five Years
X N. Insurance Coverage
X O. Board Members , Key Personnel and Consultants
X P. Questionnaire Completed by the Auditor
X Q. Certificate of the Board of Directors
Schedule E
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
ANALYSIS OF CHANGES IN CASH AND TEMPORARY INVESTMENTS
For The Fiscal Year Ended March 31 , 1985
Debt Capital Totals
General Service Projects (Memorandum
Fund Fund Fund Only)
Sources of cash and temporary
investments -
Cash receipts from revenues $333 , 508 $293, 168 $ 1 , 585 $628 , 261
Cash transfers from other
funds 85 , 000 85 ,000
Refundable deposits 2, 442 2, 442
Undistributed refunds of
purchased sewer services 9 , 443 9 ,443
Total cash and temporary
investments provided 345 ,393 293 , 168 86, 585 725, 146
Application of cash and
temporary investments -
Cash disbursed for:
Current expenditures 329 , 462 11 , 967 341 ,429
Capital outlay 95 , 433 95, 433
Debt service 264 , 865 264 ,865
Cash transfers to other •
funds 85 ,000 85,000
Total cash and temporary
investments applied 414, 462 276, 832 95, 433 786 ,727
Increase/ (decrease) in _
cash and temporary
investments ( 69 , 069) 16 , 336 ( 8 , 848) (61 , 581 )
Cash and temporary investment
balances -
At the beginning of the year 291 , 686 202, 561 17 , 379 511, 626
At the end of the year $222 , 617 $218 , 897 $ 8 , 531 $450, 045
See notes to financial statements
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108 3
GENERAL LONG-TERM DEBT SERVICE REQUIREMENTS, BY FISCAL YEARS
March 31, 1985
Series 1970-A Series 1971 Series 1971-A Series 1972
Interest Interest Interest Interest
Principal Due Principal Due Principal Due Principal Due
Fiscal Due April 1, Due April 1, Due April 1, Due April 1,
Years October 1 October 1 Total April 1 October 1 Total April 1 October 1 Total April 1 October 1 Total
Ti' 1986 $ 15,000 , $ 11,222 $ 26,222 - $ 19,762 $ 19,762 - $ 39,831 $ 39,831 - $ 15,525 $ 15,52
1987 15,000( 21,170 36,170 $ 15,00Q�) 38,944 53,944 $ 40,000f 75,675 115,675 $ 15,000 Y, 29,869 44,86
1988 15,000 19,970 34,970 20,000 37,587 57,587 40,000 72,775 112,775 15,000 28,856 43,85
1989 15,000 18,770 33,770 20,000 36,038 56,038 45,000 69,693 114,693 15,000 27,844 42,84
1990 15,000 17,570 32,570 25,000 34,294 59,294 50,000 66,188 116,188 15,000 26,831 41,83
1991 15,000 16,370 31,370 25,000 32,356 57,356 50,000 62,437 112,437 20,000 25,650 45,65
1992 15,000 15,110 30,110 30,000 30,225 60,225 55,000 58,500 113,500 20,000 24,300 44,30
1993 15,000 13,850 28,850 30,000 27,900 57,900 60,000 54,188 114,188 20,000 22,950 42,95
1994 20,000 12,590 32,590 35,000 25,381 60,381 65,000 49,419 114,419 20,000 21,600 41,60
1995 20,000 10,910 30,910 35,000 22,669 57,669 70,000 44,187 114,187 25,000 20,081 45,08
1996 20,000 9,230 29,230 40,000 19,762 59,762 75,000 38,569 113,569 25,000 18,394 43,39
1997 20,000 7,550 27,550 40,000 16,663 56,663 80,000 32,562 112,562 40,000 16,200 56,20
1998 20,000 5,870 25,870 45,000 13,369 58,369 85,000 26,169 111,169 45,000 13,331 58,33
1999 20,000 4,190 24,190 45,000 9,881 54,881 100,000 19,000 119,000 50,000 10,125 60,12
2000 20,000 2,510 22,510 50,000 6,200 56,200 110,000 10,863 120,863 60,000 6,412 66,41
2001 20,000 830 20,830 55,000 2,131 57,131 110,000 3,300 113,300 65,000 2,194 67,19
Totals $280,000 $187,712 $467,712 $510,000 $373,162 $883,162 $1,035,000 $723,356 $1,758,356 $450,000 $310,162 $760,16,
Cash and temporary investment balances at March 31, 1985 - \t"U ; Cry
Debt Service Fund $218,897 f/-1
9X
/" -
it
Schedule G
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
ANALYSIS OF CHANGES IN GENERAL LONG-TERM DEBT
For the Fiscal Year Ended March 31, 1985
Series
1970A 1971 1971A 1972 1981 Totals
nterest rate 8.00% to 7.75% 6.00% to 8.5% 5.60% to
8.5% 7.75% • 5.65%
=tes interest payable 4/1-10/1 4/1-10/1 4/1-10/1 4/1-10/1 4/1-10/1 -
•nds outstanding at
beginning of the year $295,000 $525,000 $1,070,000 $460,000 $185,000 $2,535,000
tirements of principal 15,000 15,000 35,000 10, 000 5,000 80,000
•nds outstanding at
end of year $280,000 $510,000 $1,035,000 $450,000 $180,000 $2,455,000
tirements of interest $23,083 $40,687 $79,662 $31,050 $10,383 $184,865
-eying agents -
Series 1970A,
1971 and 1972 Allied Bank of Texas, Houston, Texas and
First National Bank, Denver, Colorado
Series 1971A Allied Bank of Texas, Houston, Texas
and 1981 -
••nds voted: $3, 000,000 - Bonds approved: $3,000,000 - Bonds sold: $3,000,000
See notes to financial statements
Schedule H
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
SCHEDULE OF TEMPORARY INVESTMENTS
March 31 , 1985
Interest Maturity Face Accrued
Rate Date Amount Interest
General Fund -
Time deposit No. 100288 8 . 65% 4/24/85 $159 , 525 $265
Money-market account
No. 08-000637-9 8 . 5% - 31 , 855 -
191 , 380 265
Debt Service Fund -
Time deposit No. 9576 9 . 5% 9/25/85 201 ,044 157
Capital Projects Fund -
Money-market account
No. 53-040186-9 9 . 0% - 8 ,432 52
Total all funds $400, 856 $474
See notes to financial statements
Schedule I
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
ANALYSIS OF TAXES RECEIVABLE
For The Fiscal Year Ended March 31 , 1985
Taxes receivable at the beginning of the year $ 26, 595
1983 Original tax roll 277, 230
Total to be accounted for 303 , 825
Tax collections -
Current year 254, 107
Prior years 14 , 494
268 , 601
Taxes receivable at the end of the year $ 35 , 224
Taxes receivable by years -
1979 and prior 2 , 077
1980 1 , 633
1981 1 , 750
1982 3 , 060
1983 2 ,557
1984 23 , 147
7
$ 35 , 224
Assessed Valuations Summary (000 omitted)
Tax rate
Personal per $100
Land Improvements Property Total Valuation Tax Roll
1984 $16 , 178 $56 , 412 $1 , 236 $73 , 826 37. 4G $277. 2
1983 4 , 322 26 , 746 1 , 127 32 , 195 84G 270. 4
1982 4 , 322 26 , 636 923 31 , 881 84G 267. 2
1981 4 , 299 26 , 621 871 31 , 791 82G 260 . 2
1980 4 , 258 26, 419 776 31 , 453 82G 257 . 9
Tax collection year - From October 1 , 1984 to September 30 , 1985
Percent of assessed valuation to fair market value 100. 0%
Percent of current taxes collected to current tax levied 91 . 7%
Percent of current and delinquent taxes collected to
current and delinquent taxes outstanding at the
beginning of the year 88. 4%
See notes to financial statements
Schedule J
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
ANALYSIS OF CHANGES IN DISTRICT ORGANIZATIONAL COSTS
For The Fiscal Year Ended March 31 , 1985
Balances
March 31 , 1984
and 1985
Costs during organization and construction -
Legal fees $109 , 125
Bond interest 169, 468
Amortized bond discount 3 , 705
Fiscal agent fees 44, 000
Bond issue expenses 4 , 527
Interest on temporary investments ( 60, 013)
Total $270, 812
C
Amounts provided by -
Capital Projects Fund / $157, 652
Debt Service Fund 113, 160
Total $270, 812
See notes to financial statements
Schedule K
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
ANALYSIS OF CHANGES IN GENERAL FIXED ASSETS
For The Fiscal Year Ended March 31 , 1985
Balances Balances
March 31 , March 31 ,
1984 Additions Deductions 1985
Land $ 1 , 675 $ 1 , 675
Water system 716 , 827 716, 827
Sewage system 734, 252 734, 252
Drainage system 562 , 735 562, 735
Engineering fees 174 , 159 174, 159
Office building 107 , 178 $ 771 107,949
Furniture and fixtures 7, 346 7, 346
Construction in progress-
Lift station
rehabilitation 7 , 669 90 , 282 97, 951
$2 , 311 , 841 $91 , 053 - $2 , 402 , 894
Amounts provided by -
Capital Projects Fund $2 , 145 , 752 $ 6 , 053 $2 , 151 , 805
General Fund 166, 089 85, 000 - 251 , 089
$2 , 311 , 841 $91 , 053 - $2 , 402 ,894
See notes to financial statements
Schedule M
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
COMPARATIVE SCHEDULE - REVENUES AND EXPENDITURES
By Fiscal Years - For The Five Years Ended March 31
Revenues and Expenditures Percent of Total Fund Revenues
1985 1984 1983 1982 1981 1985 1984 1983 1982 1981
General Fund Revenues -
Water and sewer services $294,489 $291,630 $285,406 $276,461 $264,643 89.7 74.0 81.9 90.4 94.7
Penalties and interest 30,466 25,727 24,092 24,672 14,102 9.3 6.5 6.9 8.1 5. 1
Miscellaneous revenues 2,340 542 2,522 4,663 655 .7 .2 .7 1.5 .2
Tap connection fees -1 ,193 76,411 36,600 - - .3 19.3 10.5 - -
328,488 394,310 348,620 305,796 279,400 100.0 100.0 100.0 100.0 100.0
General Fund Expenditures -
Purchased sewer services 131,502 136,354 134,217 129,089 109,808 40.0 34.6 38.5 42.2 39.3
Contracted services 38,698 47,535 43,689 41,893 41,123 11.8 12.1 12.5 13.7 14.8
Professional fees 20,352 16,554 17,253 14,408 21,075 6.2 4.2 4.9 4.7 7.5
Utilities 27,997 26,917 24,681 18,159 15,521 8.5 6.8 7.2 5.9 5.6
Repairs and maintenance 71,624 41,492 57,145 39,830 36,173 21.8 10.5 16.4 13.3 12.9
Recurring operating expenses 31,372 22,319 12,653 10,473 13,730 9.6 5.6 3.6 3.4 4.9
321,545 291,171 289,638 253,852 237,520 97.9 73.8 83.1 83.2 85.0
General Fund Revenues Over
Expenditures 6,943 $103,139 $ 58,982 $ 51,944 $ 41,880 2.1 26.2 16.9 16.8 15.0
Debt Service Fund Revenues -
Tax revenues $268,601 $266,759 $265,462 $261,133 $257,599 91.6 92.9 92.2 91.0 92.5
Penalties and interest 24,497 20,364 22,592 25,727 20,905 8.4 7.1 7:8 9.0 7.5
293,098 287,123 288,054 286,860 278,504 100.0 100.0 100.0 100.0 100.0
Debt Service Fund Expenditures -
Contracted services 8,052 7,958 7,200 4,800 4,800 2.8 2.7 2.5 1.7 1.7
Property assessment fees 3,013 4,217 3,062 - - 1.0 1.5 1.1 - -
Miscellaneous expenses 1,541 652 1,877 1,797 1,552 .5 .2 .7 .6 .6
Debt service -
Interest 184,865 190,795 195,762 199,935 196,314 63.1 66.4 67.9 69.7 70.5
Principal 80,000 80,000 65,000 65,000 55,000 27.3 27.9 22.5 22.7 19.7
277,471 283,622 272,901 271,532 257,666 94.7 98.7 94.7 94.7 92.5
Debt Service Fund Revenues Over
Expenditures $ 15,627 $ 3,501 $ 15,153 $ 15,328 $ 20,838 5.3 1.3 5.3 5.3 7.5
Average annual bond principal
and interest $258,354 $258,642 $259,255 $259,334 $243,288
Coverage: Net General Fund Revenues
plus net tax revenues 1.02 1.38 1.20 1.18 1.20
Average annual unpaid bond
principal and interest
Number of customers 1,078 1,085 1,097 1,146 1,158 •
Total water pumped into the system * 141.5 133.4 126.2 121.3 131.7
Total water billed to customers* 125.2 116.3 116.5 115.5 121.1
*in millions of gallons
•
Schedule N
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
INSURANCE COVERAGE
March 31 , 1985
Insurer (1)
Amount of Co-
Type of Coverage From/To Coverage Name insurance
Fire, Lightning, Extended 11/22/84 National Standard 80%
Coverage, Vandalism and 11/22/85 Insurance Company
Malicious Mischief: -
Water plants and sewage
treatment plants $361,500
Office building and
contents $110,000
General Liability: - 11/22/84 American General Fire None
Bodily injury-aggregate 11/22/85 $300,000 and Casualty Company
Property damage-aggregate $25,000
Auto liabilit '!
y, non-owned
cars:
Bodily injury $100,000/
Property damage 300,000
Flood Insurance: - 9/24/82 National Flood Program None
Comfort station, control 9/24/85
house and contents $111,000
Faithful Performance Sched- 2/15/85 $25,000 The St. Paul Insurance None
ule Bond (5 Directors) 2/15/88 Company
Public Officials and 11/22/84 $1,000,000 International Surplus None
Employees Liability 11/22/87 ($1,000 re- Lines Insurance Co.
tention
each loss)
Boiler and Machinery 11/22/84 $500,000 The Home Indemnity None
11/22/87 Company
Tax Assessor/Collector 2/15/85 $25,000 The St. Paul Insurance None
Bond 2/15/88 Company
See notes to financial statements
Schedule 0
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
BOARD MEMBERS , KEY PERSONNEL AND CONSULTANTS
March 31 , 1985
Mailing address: 4300 Laura Lee Lane, Friendswood, TX 77546
Business telephone number: Eco-Resources, Operator - 713/240-1700
Board Members
Fees and Expense
Term Reimbursements
Expires March 31 , 1985 Title
Margaret K. George 4/ 1/88 $7, 195 President
3960 Laura Leigh Lane (Note 2)
Friendswood, TX 77546
Gina Runnels 4/ 1/86 $950 Secretary
16731 David Glen
Friendswood, TX 77546
Mary B. Jones 4/ 1/86 $1 , 035 Vice
P.O. Box 194 President
Friendswood, TX 77546
Harvey Hillmon, Jr . 4/ 1/86 $550 Member
17150 Barcelona Drive
Friendswood, TX 77546
Jack A. Roberts 4/ 1/88 $550 Member
16919 Oxnard
Friendswood, TX 77546
Note 1 : All directors were residents of the District and no director
has any business or family relationships (as defined by the
Texas Water Code) with major landowners in the District, with
the District ' s developer or with any of the District' s consul-
tants.
Date Hired Fees Paid Title
Key Administrative Personnel:
Note 2: Assigned the responsibility of administering the day-to-day
business of the District at a monthly compensation of $600.
Consultants :
Smith & Murdagh
1200 Travis Street 1/ 19/70 $5 , 757 Legal counsel
Houston, TX 77002
Alta Carbone
P.O. Box 343 4/ 19/70 $7 , 200 Tax collector
Pearland, TX 77581
Eco-Resources , Inc
P.O. Box 487 5/ 20/ 76 $45 , 373 Operator of the
Alief, TX 77411 system
Harris County Appraisal District
District 6
4624 Fairmont Parkway 1/ 1/84 $3 , 013 Central Appraisal
Houston, TX 77504 District
OTHER SUPPLEMENTAL INFORMATION
(Not Subjected to Audit Procedures)
Jl:l1CUUiC r
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
QUESTIONNAIRE TO BE COMPLETED BY THE AUDITORS
March 31 , 1985
1 . On the following chart, provide the appropriate check
. markes for each listed accounting record. Under the
"Used?" block for each record indicate either "No"
( it is not used) or "Yes" ( it is used) . Under the
"How Kept?" block indicate if records are maintained
manually, by hand, or if data are input to a computer .
Under the "When Updated?" block show how often entries
are made to each record. If entries are made less often
than monthly, write in the frequency under "How Often?" .
Indicate who provided the information for the table
below: Shirley McClennan, District Bookkeeper.
USED ? HOW KEPT? WHEN UPDATED?
RECORD By By How
No- Yes Hand Comp1ter Daily Weekly Monthly Often?
Description of Accounts x x As required
Chart of Accounts x x As required
General Journal x x _ x
Cash Receipts Journal x x x
Cash Disbrusements Journal x x x
Check Register x x x x
i
General Ledger x x x
Customer Subsidiary Ledger x x x
Fixed Assets Ledger
Bank Reconciliation x x x
Trial Balance x x x
YES NO
2 . Does the district use double entry accounting? x
3 . What is the usual location of accounting records?
Eco-Resources , Inc. , District Operator
12550 Emily Court, Sugarland, TX 77478
4 . Did you identify, during the course of your examina-
tion of the financial statements of the water
district, any areas pertaining to accounting matters
in which action should be taken by the Board of
Directors of the water district? x
If "Yes" is check for Question 4 , have these topics
been discussed in a Management Letter to the water
district ' s Board of Directors. x
5. Did you obtain representation from the Board of
Directors of the water district that all records of
the water district were made available to you for
your examination? x
Schedule P
Page 2
YES NO
6 . Did the water district:
a. Use the capital projects fund and debt
service fund only for purposes authorized by
the Board of Directors of the water district
and/or within the provisions of applicable
bond resolutions? x
b. Properly escrow the required amount of cash as
prescribed by the Texas Water Commission or
disburse the escrowed cash according to the
terms prescribed by the Texas Water Commission? N/A
c . Do business only with firms or corporations
in which members of the Board of Directors
had no pecuniary interest? x
d. Observe the conditions for obtaining grants,
gifts, etc. , or observe agreements with
governmental agencies for the purpose of
securing funds or services? N/A
e. Have a contract for Social Security coverage
for its employees with the Texas Employees
Retirement System? N/A
f. Make remittances of Social Security taxes
according to the terms of the contract fo,x
Social Security coverage with Social Security
Division of the Texas Employees Retirement
System? N/A
g. Deposit receipts to the proper funds kept by
the approved depository bank? x
h. Draw checks only on funds approved by the
Board of Directors and signed by authorized
personnel? x
7 . Did you issue a management letter to administrative
officials of the water district which sets forth
your comments, based on matters which came to your
attention during your examination, for strengthen-
ing internal accounting controls and improving
administrative efficiency and procedures? x
a. Were your recommendations explained to and
discussed with administrative officials of
the water district? x
b. The date of your most recent management
letter was May 8 , 1985
c. Is there evidence indicating that previous
year (s) recommendations have been or are
• being implemented? x
Schedule P
Page 3
YES NO
d. Has a copy of the management letter been
filed with the Texas Department of Water
Resources? x
8 . The Texas Water Code makes specific provisions
•
relating to the security provided by depository
banks. After consideration of the applicable
laws pertaining to the specific water district,
did the depository bank provide adequate
security of the correct type?
Please indicate for each depository:
See page 4 .
9 . The water district ' s taxes were collected by: (check one)
a. An employee of the district
b. The county tax assessor-collector
c. A city or other tax assessor-collector x
d. More than one of the above
10 . Was the tax assessor-collector bonded as required
by law? x
11 . What was:•
a. The tax assessor-collector bonded for? $25,000
b. The greatest amount of the district ' s taxes
in the tax assessor-collector ' s possession
at any one time? $88 , 143
c. The frequency of tax receipts deposits with
the bonded depository? (check one)
( 1 ) Daily ) Deposits are made daily during
(2) Weekly the high period of collections;
(3) Monthly) deposits are made less frequently
thereafter.
d. The percent of the assessed valuation to fair
market value? 100%
12 . We: (check one)
•
a. Actually examined the records of the tax
assessor-collector• x
b. Received written confirmation for the tax
data from the tax assessor-collector
c. Accepted tax data furnished by the dictrict ' s
'x: administrative offices .
... Y'.k yr •.
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
STATEMENT RELATING TO QUESTION NO. 8
March 31, 1985
First Texas Allied
a. Name of depository bank National Allied Commerce - Interfirst Interfirst Village Mainland Mission
Pearland Beltway Friendswood Post Oak Fannin Savings Savings Bend
b. Amount of FDIC or FSLIC
coverage $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000
c. Amount of bond or other
security pledged at the
end of the fiscal year $100,000 - - $200,000 (Note 1) - - $125,000
d. Largest cash balance $156,121 $45,864 $47,442 $159,525 $139,786 $69,424 $56,696 $201,044
e. Date of largest cash balance 1/22/85 8/23/84 7/20/84 3/29/85 3/29/85 7/31/84 12/10/84 3/29/85
f. Amount of bond or security
pledged at the time of the
largest cash balance (ex-
cluding FDIC or FSLIC
coverage) $100,000 - - $200,000 (Note 1) - - $125,000
Note 1: Funds are transferred to bond paying agent through this bank;
funds remain in the bank for one day. Accordingly, the bank
does not pledge securities for so short a time.
Note 2: By adoption of the Bond Orders of all of the series of bonds
issued by the District, the District has pledged to the bond-
holders the net revenues from the operation of the system and
the taxes levied by the District. Section 330.8 par. (b) of
the FDIC Rules and Regulation states:
"Public Bond Issues. Where an officer, agent or eMployee of a
public unit has custody of certain funds which by law or under
the bond indenture are required to be paid to the holders of
bonds issued by the public unit, any deposit of such funds in an
insured bank shall be deemed to be a trustee of trust funds of
which the bondholders are pro rata beneficiaries, and each such
beneficial interest shall be separately insured for $40,000."
4
=£ Schedule P
Page 5
4
I
1
1 1 YES NO
i
{
' 10. As a result, were local tax revenues ( including
• delinquent taxes and interest and penalties on
taxes) properly separated for debt service? x
14 . Was the water district in compliance with
applicable bond resolutions, with the general
or special legislation under which the district
was created and with the specific statutes
excerpted and included in the Legal Compliance
i Guidelines in Section 70-03-1 of the Water
District Accounting Manual? x
Any exceptions noted duringthe course of our •
P
examination of the financial statements are
described in the management letter or notes to
the financial statements.
15. Other comments of the Auditor:
None
i
1
f
i
i
a
.
•
• Y
r
is
r
Schedule Q
•
CERTIFICATE OF THE BOARD OF DIRECTORS
HARRIS COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NO. 108
•
We, the undersigned, do hereby certify that the audit report
of the above-named Water District for the fiscal year ended March
31 , 1985 , was received by the Board of Directors on the day
of , 1985 and was reviewed and approved;
disapproved at a meeting of the Board of Directors of the
Water District on the day of , 1985.
Signature of Board Secretary Signature of Board,President