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CAFR FY 1999-00COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 F�O`sSCHER�iA c'pow U -35 I -1( CITY OF SCHERTZ. TEXAS CITY OF SCHERTZ, TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR ENDED SEPTEMBER 30, 2000 This page intentionally left blank CITY OF SCHERTZ, TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED SEPTEMBER 30, 2000 TABLE OF CONTENTS INTRODUCTORY SECTION PAGE TABLE OF CONTENTS i LETTER OF TRANSMITTAL iv CITY OFFICIALS x ORGANIZATIONAL CHART xi CERTIFICATE OF ACHIEVEMENT xii FINANCIAL SECTION INDEPENDENT AUDITOR'S REPORT .......................................................................... ............................... 1 GENERAL PURPOSE FINANCIAL STATEMENTS ...................................................... ............................... 3 COMBINED BALANCE SHEET - ALL FUND TYPES, ACCOUNT GROUPS AND DISCRETELY PRESENTED COMPONENT UNITS ........................................................................... ............................... 4 COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -ALL GOVERNMENTAL FUND TYPES AND DISCRETELY PRESENTED COMPONENTUNITS .................................................................................................. ............................... 8 COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL - GENERAL, SPECIAL REVENUE, AND DEBT SERVICEFUND TYPES ............................................................................................ ............................... 10 COMBINED STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS - ALL PROPRIETARY FUND TYPES .................................................. ............................... 12 COMBINED STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES ........................ 13 NOTES TO FINANCIAL STATEMENTS .................................................................... ............................... 15 COMBINING AND INDIVIDUAL FUND AND ACCOUNT GROUP FINANCIAL STATEMENTSAND SCHEDULES ............................................................................... ............................... 38 GOVERNMENTAL FUND TYPES GENERALFUND ............................................................................................................ ............................... 39 COMPARATIVE BALANCE SHEETS .......................................................................... .............................40 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ........................................................... ............................... 41 SCHEDULE OF REVENUES COMPARED TO BUDGET ........................................... .............................42 SCHEDULE OF CURRENT EXPENDITURES COMPARED TO BUDGET ............ ............................... 43 1 SPECIAL REVENUE FUNDS ........................................................................................... .............................44 COMBINING BALANCE SHEET - SPECIAL REVENUE FUNDS ............................. .............................45 COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND - BALANCES, SPECIAL REVENUE FUNDS ............................................................. ............................... 47 PARK SPECIAL REVENUE FUND - STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ............................... ............................... 49 RECYCLING SPECIAL REVENUE FUND - STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ...................... ............................... 50 HOTEL OCCUPANCY TAX SPECIAL REVENUE FUND - STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ..................... 51 DEBTSERVICE FUND ................................................................................................... ............................... 52 COMPARATIVE BALANCE SHEETS .......................................................................... .............................53 STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL ...................................................... ............................... 54 CAPITAL PROJECTS FUND ............................................................................................ .............................55 COMPARATIVE BALANCE SHEETS .......................................................................... .............................56 COMPARATIVE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE ..................................................................... ............................... 57 PROPRIETARY FUND TYPE ENTERPRISEFUNDS ....................................................................................................... .............................58 COMBINING BALANCE SHEET ................................................................................ ............................... 59 COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN RETAINED EARNINGS .................................................................... ............................... 61 COMBINING STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES .................................................................................. ............................... 62 GENERALFIXED ASSETS .............................................................................................. .............................64 COMPARATIVE SCHEDULE OF GENERAL FIXED ASSETS BY SOURCE ........ ............................... 65 SCHEDULE OF GENERAL FIXED ASSETS - BY FUNCTION AND ACTIVITY . ............................... 66 DISCRETELY PRESENTED COMPONENT UNITS .................................................... ............................... 68 COMBININGBALANCE SHEET ................................................................................ ............................... 69 COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES INFUND BALANCE .................................................................................................. ............................... 70 REPORT ON COMPLIANCE AND INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS ........................................................ ............................... 71 STATISTICAL SECTION GENERAL GOVERNMENTAL EXPENDITURES BY FUNCTION - LAST TEN FISCAL YEARS ..... 74 GENERAL GOVERNMENTAL REVENUES BY SOURCE - LAST TEN FISCAL YEARS .................. 75 PROPERTY TAX LEVIES AND COLLECTIONS - LAST TEN FISCAL YEARS ... ............................... 76 m ASSESSED AND TAXABLE VALUE OF PROPERTY - LAST TEN FISCAL YEARS .......................... 78 PROPERTY TAX RATES - ALL OVERLAPPING GOVERNMENTS - LAST TEN FISCAL YEARS.. 79 RATIO OF NET GENERAL BONDED DEBT TO TAXABLE VALUE AND NET GENERAL BONDED DEBT PER CAPITA - LAST TEN FISCAL YEARS ............................... ............................... 80 COMPUTATION OF DIRECT AND OVERLAPPING DEBT .................................... ............................... 81 LEGALDEBT MARGIN .............................................................................................. ............................... 82 RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR GENERAL OBLIGATION BONDED DEBT TO TOTAL GENERAL FUND EXPENDITURES - LAST TEN FISCAL YEARS.... 83 REVENUE BOND COVERAGE - UTILITY SYSTEM BONDS - LAST TEN FISCAL YEARS............ 84 WATERWORKS AND SEWER SYSTEM FUNDS - REVENUE BOND REQUIREMENTS AND RESTRICTEDFUNDS ................................................................................................ ............................... 86 DEMOGRAPHICSTATISTICS ................................................................................... ............................... 87 PROPERTY VALUE AND NEW CONSTRUCTION - LAST TEN FISCAL YEARS .............................. 88 PRINCIPALTAXPAYERS ........................................................................................... ............................... 90 MISCELLANEOUS STATISTICS .................................................................................. .............................91 iii This page intentionally left blank January 26, 2001 1400 SCHERTZ PARKWAY STEVE SIMONSON P.O. DRAWER I INTERIM CITY MANAGER SCHERTZ, TEXAS 78154-0890 AC (210) 658 -3510 FAX (210) 659 -3204 To the Citizens of the City of Schertz, Texas: The comprehensive annual financial report (CAFR) of the City of Schertz, Texas, (the City) for the year ending September 30, 2000 is submitted herewith. Responsibility for both the accuracy of the presentation including all disclosures rests with the City. The data, as presented, is accurate to the best of our ability in all material aspects. The report is presented in a manner designed to set forth the financial position of the City and provide a review of various funds. We have attempted to provide all disclosures necessary to enable the reader to gain maximum understanding of the City's financial activity. The accompanying CAFR is presented in the following three (3) sections: 1. Introduction - Includes this letter of transmittal, Organizational Chart, comments regarding economic conditions and outlook, major occurrences of fiscal year 1999 -2000, and major initiatives for fiscal year 2000 -01. 2. Financial - This section consists of: the independent auditor's report, general purpose financial statements including combined balance sheets and combined statements of revenues, expenditures, and changes in fund balance, notes to financial statements, and individual fund statements and account groups with supplemental statements. Within information contained in this section is a review of the accounting system and controls, and includes commentary thereto. 3. Statistical - This section includes selected financial and demographic information, generally presented on a multi -year basis. No Single Audit Reports were required for this audit period because the City did not meet the $300,000 threshold, as required by The Single Audit Act, for issuance of this report. This report includes all funds and account groups of the City of Schertz. The City provides a full range of services including: police, emergency medical transportation, and fire protection; water and sewer services; waste collection; code enforcement; comprehensive planning; street maintenance and recreational activities as well as economic development efforts. While the Schertz Public Library is an operating department of city government, the Library Board serves as an advisory board and maintains a small amount of funds, derived from private sources, as a means to fund specific improvements /additions to the library outside City resources. The Schertz Development Foundation is a separate nonprofit corporation organized and operated for the charitable purpose of assisting the City of Schertz, Texas, to develop and implement plans for economic viability to the City. The Schertz Economic Development Corporation was created to promote economic development in our City. The library, economic development corporation, and the foundation are reported as component units, discretely presented. The Schertz Volunteer Fire Department Board does not meet the criteria for inclusion in the reporting entity, and accordingly, is excluded from this report. ECONOMIC CONDITION AND OUTLOOK The City is located near the center of the San Antonio Standard Statistical Metropolitan Area (SMSA) that continues to rank as one of the highest tourist attractions in the Southwest. The economic conditions and outlook remain sound. Statistical data for fiscal year 1999 -2000 includes new housing starts of 332, compared to 520 for 1998 -1999 and 537 for 1997 -1998. Total building permits were $59,100,348 for 1999 -2000 compared to $76,501,637 in 1998 -1999 and $82,872,572 in 1997 -1998. 10 The current economic conditions remain strong. Unemployment in the area remains at historically low levels at 3 %. The City of Schertz is at the southern end of the Austin /San Antonio Corridor, which remains one of the fastest growing regions in the country. The City of Schertz can draw from a labor pool of over 750,000. We are, however, beginning to see signs of labor shortages in certain segments of the economy. The near -term remains very positive. Commercial inquiries are steady, and the size and scope of the projects seem to be growing larger as higher profile companies look at this area. The long -term outlook also remains positive because of the underlying fundamentals of the area economy: a sizable but often under - employed work force; competitive taxes; excellent quality of life; improving infrastructure; space for continued growth; political stability; and continued forward planning in both the near and long term. Our economy seems to mirror the national economy, and is affected by changes in the national economy far more than one would anticipate given our size, especially changes in interest rates. Nonetheless, we remain optimistic that our growth will continue, albeit at a slower pace. CURRENT YEAR PROJECTS Recent new developments as well as enhancement of existing businesses and the attitude that "nothing breeds success like success" seem to effect relocation and growth activity for our area. A positive outlook is shared by all involved in the community's economic development activities. The City is currently working with several substantial prospects to relocate to the area. We continue to receive an ever - larger number of inquiries, which is another positive economic sign. One of the major strengths of the City is an abundance of land available for development along the San Antonio /Austin corridor of IH -35 and similarly available land for development along the corridor between Houston /San Antonio of IH -10. Construction began on FM 78 in Schertz in January 2000. The project is scheduled to take approximately 24 months and will cost $8.3 million. This long awaited re- construction includes a new bridge that meets the 100 - year flood requirement. Development of an alternative water supply in partnership with the City of Seguin has moved into high gear. Various permits and approvals have been obtained and the test well has shown more and better quality water source than had been anticipated. The pipeline design has been completed and major portion of the right -of -way has been obtained. Additionally, enough land has been purchased or leased to assure water for the two cities for the next half a century, with the potential to be able to provide for the needs of the adjoining cities and townships, as well. Pipeline construction is scheduled to begin in April 2001 and scheduled to be completed by July 2002. The second -phase joint bond issuance to fund the project is scheduled for third week of February 2001. With water availability from the Wilcox - Carrizo aquifer a reality, the future growth of the City of Schertz and its residents is assured well into the future. MAJOR EVENTS The major event of 1999 -2000 continues to be that of growth; however, we now see the beginnings of a more balanced growth pattern between retail, industrial, and residential. We have had 158 new residential lots platted during the past twelve months. Ashley Place, Dove Meadows, and Woodland Oaks, Unit 5A, 5B, 6A, 613, and 6C Subdivision have completed their build -out with a combined total of 1089 new homes. The Greenshire subdivision is now building in its last section, which will bring their combined new residential units to 505 when completed. The subdivisions of Carolina Crossing, Forest Ridge, Woodbridge, Oak Trails, and Arroyo Verde continue to grow with several more years of residential growth projected. The Jonas woods Subdivision is underway and, when completed, will bring 315 new residential lots. The Wynn Brook Subdivision infrastructure is underway and a breakout is projected in the spring of 2001. It is interesting to note that between the years of 1993 and August 2000 there were 3,191 new residential lots platted. There may be some reduction of housing units in the next five years because much of the prime tree - covered residential land is already in production for residential lots. It appears, however, that the developers will continue to produce residential lots on available open land with tree planting incentives and other inducements for upscale housing in the $150K + market. With several existing subdivisions still in production of residential lots and several developers actively seeking additional land, the new platted lot count could very easily reach 3,750 within the next three to five years. v During the coming year we believe the City will continue to benefit from a positive outlook and the results of earlier planning. In December 1997, the City issued 4.9 million dollars of general obligation bonds pursuant to an August, 1997 election. Bonds for police, fire, and EMS building construction and specific library building improvements were rated "AAA" with FGIC insurance, with an underlying rating of "A" sold at an average effective interest rate of 4.8233 %. The August, 1997 election included approval of an additional 112 cent sales tax levy to provide debt service for specific capital improvements including those emergency service building projects. Construction on the three emergency service buildings was completed in mid -year 2000, and the new Safety Complex was dedicated at an open house in August 2000. The remodel work on the library was finished in the latter part of 1999, and the renovation of the municipal building has also been completed. Tri- County Business and Industrial Park continues to be a prime location, as a fully developed business park. This year Bordertown (a combination store housing Taco Bell, Pizza Hut and Kentucky Fried Chicken, along with a video arcade game room) has opened retail outlets complementing the existing mix of quick food outlets at the intersection of IH -35 and FM 3009. While we do not have a single major industrial employer, our rapid growth as a large distribution hub puts Schertz in a position to attract manufacturing activity. Several new warehousing, distribution and storage facilities came on -line during 2000. At the end of 2000, the City Council heard a proposal for the construction of a liquor and wine wholesale warehouse/ distributorship, the largest in southwest Texas. Construction has started and the operations are expected to begin by fall of 2001. INITIATIVES FOR FUTURE In the spring of 2001, the City will begin work with a consulting firm on a new comprehensive land plan for the new millennium. Major areas to be addressed will include, but not be limited to: transportation, recreation, planned future growth and infrastructure enhancements. Schertz is now evolving from being a mere bedroom community for a metropolitan area to having a significant role to play in servicing the distribution channels along the San Antonio - Austin corridor along 1 -35 to the North -East and San Antonio - Houston route along 1 -10 West. Schertz has the distinction of stretching across three counties and being the second largest city in each county. FINANCIAL INFORMATION The City's accounting records for general governmental operations are maintained on a modified accrual basis, with revenues being recognized when they become both measurable and available and expenditures being recognized when the services or goods are received and the liabilities are incurred. Accounting records for the City's utilities and other enterprises are maintained on the accrual basis of accounting. In developing and altering the City's accounting systems, consideration has been given to the adequacy of internal accounting controls. Internal accounting controls have been designed to provide reasonable assurance regarding: The safeguarding of assets against loss from unauthorized use of disposition and, The reliability of financial records for preparing financial statements and maintaining accountability for assets. The concept of reasonable assurance recognizes that: The cost of a control should not exceed the benefits likely to be derived and, The evaluation of costs and benefits required estimates and judgments by management. All internal control evaluations occur within the above framework. The City's internal accounting controls adequately safeguard assets and provide reasonable assurance of proper recording of financial transactions. vi Budgetary control is maintained by the use of purchase order procedures that require encumbrance of the estimated purchase amounts prior to the release of purchase orders to vendors. Open encumbrances, if any, are reported as reservations of fund balance at September 30, 2000. General Governmental Functions: Revenues include general, special revenue, debt service, and capital projects for general governmental function totaled $6,593,500 in 2000, an increase of 0.17% from 1999. Taxes produced 62.01 °% of general revenues compared to 55.78% last year. The amount of revenues from various sources and the increase /decrease from last year are shown in the following tabulation: PERCENT INCREASE OF (DECREASE) AMOUNT TOTAL FROM 1999 Taxes (Property, Sales, Etc.) $4,088,491 62.01% $ 416,975 Licenses and Permits 731,488 11.09 51,172 Charges for Services 626,464 9.50 67,560 Fines and Forfeitures 444,331 6.74 64,747 Other Revenues 702,726 10.66 (589,472) $6,593,500 100.00% 10,982 Expenditures: For general governmental purposes, expenditures totaled $8,602,863, a decrease of 12% from 1999. Changes in levels of expenditures for major functions of the City over the preceding year are shown in the following tabulation: PERCENT INCREASE OF (DECREASE) FUNCTION AMOUNT TOTAL FROM 1999 General Government $1,558,650 18.12% $ 251,162 Public Safety 2,212,924 25.72 151,436 Streets and Parks 793,700 9.23 (12,329) Health Services 155,814 1.81 13,527 Recreation 259,848 3.02 (15,017) Management Services 83,273 0.97 (195,785) Bond Issue Cost - 0.00 - Capital Outlay 2,870,723 33.37 (1,373,453) Debt Service 667,931 7.76 2,211 $8,602,863 100.00% $(1,178,248) As reflected in the financial statements, general fund revenuers iqcluding sales tax as well as ad Valorem taxes enerall ed Through cooperative agreements with Guadalupe County, specific intergovernmenta payments for services such as library, fire, and SAFES have increased. Other major fluctuations include: an increase in construction permits and related items due to an increase in total construction. Genal fund expenditures have increased in a number of areas incluung_ overall person costs resulting from step increases an i ems. a ieve overa area in budget accounts ore correc y re c actua cos ce vi y function than in years prior. General obligation bonded debt data for the City of Schertz at the end of the 1999 fiscal year was as follows: vii Net General Obligation Bonded Debt (Principal) General Obligation Bonds Revenue Bonds RATIO OF DEBT TO ASSESSED VALUE (100 %) OF PRESENT MARKET AMOUNT DEBT PER CAPITA $5,321,410 0.84 $287.64 STANDARD R PnnR'.q A A Property Taxes. Current tax collections are 98.0% of the tax levy. This is the eighteenth consecutive year in which current property tax collections have exceeded 97.0 %. The ratio of total collections (current and delinquent) to the current tax levy was 99.97 %. Allocations of property tax levy by purpose for 2000 and the preceding two fiscal years are as follows (amounts per $100 assessed value): PURPOSE General Fund General Obligation Debt 2000 1999 1998 .3152% .3169% .3049% .0304% .0375% .0505% .3456% .3544% .3554% Cash Management. Cash temporarily idle during the year was invested in short -term time deposits and investment pools. The interest earned on such deposits during the year was $587,985, an increase of $13,438 interest compared to earnings during 1999. This increase was due to more funds being invested in investment pools. Bank deposits and certificates of deposit are secured by FDIC insurance and governmental securities pledged by Schertz Bank and Trust and held in safekeeping by Frost Bank. General Fixed Assets. The general fixed assets of the City are those fixed assets used in the performance of general governmental functions and exclude the fixed assets of enterprise funds. As of September 30, 2000, the general fixed assets of the City amounted to $19,617,100. This amount represents the current cost, or an estimate of the original cost of the assets. Depreciation of general fixed assets is not generally recognized in the City's accounting system. The City is self- insured on physical damage to specific vehicles. In order to provide coverage for this, risk funds are designated within the general fund with a balance of $45,000 at September 30, 2000 and an allocation within the reserve of $345,700. Water and Sewer System. Comparative data for the past two fiscal years is presented below: Total Operating Revenue Operating Income (Gross Revenues Less Operating Expenses) Net Revenues (Operating Income Plus Depreciation Less Solid Waste Revenues) Average Annual Bonded Debt Requirements an 2000 1999 $3,958,054 $3,250,589 759,358 1,1 17,644 147,747 626,171 1,021,961 133,233 During the year, $35,000 of maturing revenue bonds and $5,000 in Public Facility HUD Bond and $29,821 of a note payable (New Braunfels Utilities) were retired in the water and sewer fund. City Of Schertz Emergency Services. During the fiscal year ended September 30, 2000, Emergency Services operations revenues increased 9.7% and operating expenses were increased by 1.9 %. This activity is fully dependent on income fees generated from services rendered and the contracted cities' support to cover operations costs. This year there was an operating loss before depreciation of $29,582. OTHER INFORMATION Award The Government Finance Officers Association of the United States and Canada (GFOA) awarded a ertificate of Achievement for Excellence in Financial Reporting to the City for its comprehensive annual financial report for the fiscal year ended September 30, 1999. The Certificate of Achievement is the highest form of recognition for excellence in state and local government financing reporting. requirements. A Certificate of Achievement is valid for a period of one year only. The City of Schertz has received a Certificate of Achievement for the last 12 consecutive years. We believe our current report continues to conform to the Certificate of Achievement program requirements, and we are submitting it to GFOA. The City Council has selected the firm Armstrong, Vaughan & Associates, P. C., of Universal City, Texas, to perform the independent audit for the fiscal year 1999 -2000. We find the background experience and interest of the firm will assure the accomplishment of the audit function in an outstanding manner and will provide educational training opportunities for our staff. Acknowledgements. I want to extend my thanks to the Mayor and members of the City Council for their interest and support in planning and conducting the financial operations of the City in an effective and efficient manner. Mr. Vijay Jain of our staff and Ms. Nancy Vaughan, along with other representatives of the audit firm of Armstrong, Vaughan & Associates, P. C., have provided a high degree of expertise and assistance for the preparation of the report. I wish to express my personal thanks and appreciation to everyone involved in the audit process for their help. I am especially appreciative of both City and the audit firm staff working together to assure a smooth transition from our prior audit firm to Armstrong, Vaughan & Associates. Also, I would like to commend Ms. Vaughan's patience in reviewing the financial information that involved migration from City's old Financial Management software to a Y2K- compliant integrated system. Respectively Submitted, Steve Simonson Interim City Manager ix MAYOR CITY COUNCIL INTERIM CITY MANAGER COMPTROLLER CITY OF SCHERTZ, TEXAS CITY OFFICIALS HONORABLE HAL BALDWIN REGINA AGEE MAYOR PRO -TEM (DECEMBER 21, 1999 TO AUGUST 15, 2000) KENNETH GREENWALD PIA JARMAN (OCTOBER 1, 1999 —MAY 4, 2000) NORMA HEAD (MAY 4, 2000) JOE POTEMPA MAYOR PRO -TEM (MAY 4, 1999 TO DECEMBER 21, 1999) GLYN D. WILLIAMS MAYOR PRO -TEM STEVE SIMONSON VIJAY JAIN INDEPENDENT AUDITORS Armstrong, Vaughan & Assoc., P.C. Universal City, Texas OFFICIALS ISSUING REPORT Steve Simonson Interim City Manager Vijay Jain Comptroller x This page intentionally left blank U N O 0 -v � n At, A� o C'nmAA46v�Aa o .. Q c6b V N a e u1^ .-r .�+ N M •--� .-. N �-+ o A g��� o °,��v ��g,a �v Eo �w4��a� �+ a .�-+M ��N•-+N �� .-ANN o o 3 c xi a� ew E �a %n N 4 Certificate of Achievement for Excellence in Financial Reporting Presented to City of Schertz, Texas For its Comprehensive Annual Financial Report for the Fiscal Year Ended September 30, 1999 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. 3 wo resident Executive Director X11 FINANCIAL SECTION This page intentionally left blank ARMSTRONG, VAUGHAN & ASSOC., P.C. ................................................................... ............................... CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITOR'S REPORT The Honorable Mayor and Members of the City Council City of Schertz, Texas We have audited the accompanying general - purpose financial statements of the City of Schertz, Texas, as of and for the year ended September 30, 2000, as listed in the table of contents. These general- purpose financial statements are the responsibility of the City of Schertz, Texas', management. Our responsibility is to express an opinion on these general - purpose financial statements based on our audit. The general - purpose financial statements of the City of Schertz as of September 30, 1999 were audited by other auditors whose report dated February 10, 2000, expressed an unqualified opinion on those statements. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general - purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general- purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall 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 Schertz, Texas, as of September 30, 2000, and the results of its operations and cash flows of its proprietary fund types and nonexpendable trust funds for the year then ended in conformity with generally accepted accounting principles. (As more fully described in Note N, subsequent to the issuance of the City of Schertz, Texas' 2000 general purpose financial statements and our report thereon, dated December 20, 2000, we became aware of certain errors resulting in an overstatement of accounts payable and current expenditures in the Capital Projects Fund. Accordingly, the statements have been revised as of March 12, 2001 to correct the error. In our original report, we exl�sed an unqualified opinion on the 2000 general- purpose financial statements, and our opinion on the revised statements as expressed herein,.rema3n&�u- equal' fed. In accordance with Government Auditing Standards, we have also issued a report dated December 20, 2000, on our consideration of the City of Schertz, Texas', internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit. 433 KITTY HAWK, SUITE 113 • UNIVERSAL CITY, TEXAS 78148 • (210) 658 -6229 • FAX (210) 659 -7611 • www.avacpa.com Our audit was performed for the purpose of forming an opinion on the general - purpose financial statements of the City of Schertz, Texas, taken as a whole. The combining and individual fund and account group financial statements for the year ended September 30, 2000, and supplementary 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. Such information has been subjected to the auditing procedures applied in the audit of the general- purpose financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the general - purpose financial statements taken as a whole. The statistical data, as listed in the table of contents herein, has been summarized from the City's records and was not subjected to the auditing procedures applied in the audit of the general - purpose financial statements of the City of Schertz, Texas. Accordingly, we do not express an opinion on such data. A rwutr&Yt*, Vaugha vv FT Assorl , P.C. Armstrong, Vaughan & Assoc., P.C. December 20, 2000, except as to the fourth paragraph above and Note N, which are as of March 10, 2001. 2 GENERAL PURPOSE FINANCIAL STATEMENTS CITY OF SCHERTZ, TEXAS COMBINED BALANCE SHEET - ALL FUND TYPES, ACCOUNT GROUPS AND DISCRETELY PRESENTED COMPONENT UNITS SEPTEMBER 30, 2000 Governmental Fund Types Proprietary Fund Types The accompanying notes are an integral part of these statements. 4 Special Debt Capital Internal ASSETS & OTHER DEBITS General Revenue Service Projects Enterprise Service Cash and Cash Equivalents $2,988,694 $ 663,799 $ 184,999 $1,104,573 $ 3,287,811 $ 28,731 Receivables (Net of Allowances) Taxes 81,041 - 9,086 - - - Accounts 233,609 36,419 - - 773,213 - Other - - - - 20,183 - Due From Other Funds 130,440 11,083 - - 163,780 - Due From Component Units 50,695 - - - - - Inventory at Cost 14,315 - - - 88,931 1,414 Prepaid Expenses 47,975 - - - 18,306 737 Restricted Assets: Cash and Cash Equivalents - - - - 1,927,162 - Fixed Assets (Net of Accumulated Depreciation) - - - - 5,497,802 53,862 Organization Costs (Net of Accumulated Amortization) - - - - 477 - Bond Issue Costs (Net of Accumulated Amortization) - - - - 16,255 - Deferred Loss on Early Retirement of Debt (Net of Accumulated Amortization) - - - - 43,630 - Other Debits: Amount Available in Debt Service Fund - - - - - - Amount to be Provided for Retirement of General Long - Term Debt - - - - - - Amount to be Provided for Employee Compensated Absences and Salary Reserve - - - - - - TOTAL ASSETS AND OTHER DEBITS $3,546,769 $ 711,301 $ 194,085 $1,104,573 $11,837,550 $ 84,744 The accompanying notes are an integral part of these statements. 4 Account Groups Totals - 358,548 233,351 $19,617,100 $5,829,958 (Memorandum $ 719,266 $ 43,645,346 Totals General Only) (Memorandum Only) General Long -Term Primary Component Reporting Entity Fixed Assets Debt Government Units 2000 1999 $ - $ - $ 8,258,607 $ 653,586 $ 8,912,193 $ 9,269,782 - - 90,127 - 90,127 100,918 - - 1,043,241 59,656 1,102,897 617,635 - - 20,183 - 20,183 742,798 - - 305,303 - 305,303 976,982 - - 50,695 - 50,695 43,206 - - 104,660 6,024 110,684 125,103 - - 67,018 - 67,018 - - - 1,927,162 - 1,927,162 1,266,664 19,617,100 - 25,168,764 - 25,168,764 22,593,400 - - 477 - 477 525 - - 16,255 - 16,255 20,006 - - 43,630 - 43,630 53,699 105,019 105,019 - 5,366,391 5,366,391 - 105,019 170,444 - 5,366,391 5,666,786 - 358,548 358,548 - 358,548 233,351 $19,617,100 $5,829,958 $42,926,080 $ 719,266 $ 43,645,346 $ 41,881,299 Continued 5 CITY OF SCHERTZ, TEXAS COMBINED BALANCE SHEET - ALL FUND TYPES, ACCOUNT GROUPS AND DISCRETELY PRESENTED COMPONENT UNITS (CONTINUED) SEPTEMBER 30, 2000 Governmental Fund Types Proprietary Fund Types LIABILITIES AND EQUITY AND OTHER CREDITS Special Debt Capital Internal General Revenue Service Projects Enterprise Service Liabilities: Vouchers Payable $ 226,350 $ 4,680 $ 225 $ 9,496 $ 466,280 $ 1,212 Notes Payable - Current - - - - 32,106 - Accrued Salaries and Benefits 57,608 - - - 23,880 1,066 Bond Escrow 12,500 - - - - - Salary Reserve - - - - 49,229 1,871 Compensated Abscences Payable - - - - 64,409 2,163 Payable from Restricted Assets: Deposits - - - - 213,655 - Revenue Bonds - - - - 35,000 - Certificates of Obligation - - - - 10,000 - Refunding Bonds - - - - 245,890 - Public Facility Loan - - - - 5,000 - Accrued Interest - - - - 11,540 - Due to Other Funds 95,079 46,691 79,755 8,000 8,256 67,522 Due to Component Units - - - - - - Due to Primary Government - - - Deferred Revenue 81,041 - 9,086 - - - General Obligation Bonds Payable - - - - - - Revenue Bonds Payable - - - - 750,000 - Certificates of Obligation Payable - - - - 120,000 - General Obligation Refunding Bonds - - - - 297,700 - Public Facility Loan - - - - 57,000 - Note Payable (Less Current Maturities - - - - 34,564 - Total Liabilities 472,578 51,371 89,066 17,496 2,424,509 73,834 Fund Equity and Other Credits: Contributed Capital - - - - 3,915,525 63,577 Investment in General Fixed Assets - - - - - Retained Earnings (Deficit) Reserved for Revenue Bond Retirement - - - - 374,586 - Reserved for Equipment Replaceme - - - - 40,000 - Reserved for Contingencies - - - - 972,500 - Unreserved - - - - 4,110,430 (52,667) Fund Balances (Deficit) Reserved for Forfeited Property 19,814 - - - - ' Reserved for Inventory 14,315 - - - - - Reserved for Municipal Court 24,103 - - - Unreserved - Designated for: Capital Improvement - - - 1,087,077 - - General Fund Projects 2,269,593 - - - - - Special Revenues - 659,930 - - - - Component Units - - - Undesignated 746,366 - 105,019 - - - Total Fund Equity (Deficit) 3,074,191 659,930 105,019 1,087,077 9,413,041 10,910 and Other Credits TOTAL LIABILITIES, FUND EQUITY AND OTHER CREDIT $3,546,769 $ 711,301 $ 194,085 $1,104,573 $ 11,837,550 $ 84,744 The accompanying notes are an integral part of these statements. 6 - - 1,087,077 Totals 2,077,276 - - 2,269,593 - 2,269,593 Account Groups (Memorandum - 659,930 Totals - - - General Only) - - 851,385 (Memorandum Only) General Long -Term Primary Component Reporting Entity Fixed Assets Debt Government Units 2000 1999 $ - $ - $ 708,243 $ 37 $ 708,280 $ 1,422,005 - - 32,106 - 32,106 29,821 - - 82,554 - 82,554 65,756 - - 12,500 - 12,500 - - 122,724 173,824 - 173,824 65,756 - 235,824 302,396 - 302,396 251,901 - - 213,655 - 213,655 166,597 - - 35,000 - 35,000 35,000 - - 10,000 - 10,000 10,000 - - 245,890 - 245,890 198,314 - - 5,000 - 5,000 5,000 - - 11,540 - 11,540 14,764 - - 305,303 - 305,303 976,982 - - - - - 10,606 - - - 50,695 50,695 32,600 - - 90,127 - 90,127 100,918 - 5,125,000 5,125,000 - 5,125,000 5,354,000 - - 750,000 - 750,000 785,000 - 150,000 270,000 - 270,000 345,000 - 196,410 494,110 - 494,110 811,686 - - 57,000 - 57,000 62,000 - - 34,564 - 34,564 66,671 - 5,829,958 8,958,812 50,732 9,009,544 10,810,377 - - 3,979,102 - 3,979,102 4,117,208 19,617,100 - 19,617,100 - 19,617,100 16,802,163 - - 374,586 - 374,586 412,488 - - 40,000 - 40,000 40,000 - - 972,500 - 972,500 - - - 4,057,763 - 4,057,763 3,924,376 - - 19,814 - 19,814 19,814 - - 14,315 6,024 20,339 16,252 - - 24,103 - 24,103 - - - 1,087,077 - 1,087,077 2,077,276 - - 2,269,593 - 2,269,593 271,237 - - 659,930 - 659,930 533,291 - - - 662,510 662,510 350,909 - - 851,385 - 851,385 2,505,908 19,617,100 - 33,967,268 668,534 34,635,802 31,070,922 $19,617,100 $ 5,829,958 $42,926,080 $ 7191266 $ 4356451346 $ 41,881,299 7 CITY OF SCHERTZ, TEXAS COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - ALL GOVERNMENTAL FUND TYPES AND DISCRETELY PRESENTED COMPONENT UNITS FOR THE YEAR ENDED SEPTEMBER 30, 2000 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1999) REVENUES Taxes Licenses and Permits Charges for Services Fines and Forfeits Grants Other Revenue TOTAL REVENUES EXPENDITURES Current: General Government Public Safety Streets and Parks Health Culture and Recreation Management Services Capital Outlay Debt Service: Principal Retirement Interst and Fiscal Charges TOTAL EXPENDITURES Excess (Deficiency) of Revenues Over (Under) Expenditures OTHER FINANCING SOURCES (USES) Operating Transfers In Operating Transfers (Out) Operating Transfers (to) from Primary Government Operating Transfers (to) from Component Unit TOTAL OTHER FINANCING SOURCES (USES) Excess (Deficiency) of Revenues & Other Sources Over (Under) Expenditures & Other (Uses) Fund Balances - Beginning Prior Period Adjustment Fund Balances - Beginning As Adjusted Residual Equity Transfers In (Out) Fund Balances - Ending Governmental Fund Types 1,083 198,612 - (199,695) (18,691) - - 10 606 - 388.104 - (189,089) (17,608) 586,716 - 114 Qnl 126.619 (65.425) (990.199) 2,642,767 533,291 170,444 2,077,276 96,521 - - - 2,739,288 533,291 170,444 2,077,276 $ 3,074,191 $ 659,930 $ 105,019 $ 1,087,077 The accompanying notes are an integral part of these statements. 8 Special Debt Capital General Revenue Service Projects $ 4,042,025 $ 46,466 $ - $ - 587,565 143,923 - - 626,464 - - - 435,574 8,757 - - 17,558 262,468 - 273,185 56,840 15,790 76,885 5,982,371 518,454 15,790 76,885 1,452,638 26,858 - 79,154 2,172,342 277 - 40,305 671,725 121,975 - - 155,814 - - - 253,008 - - 6,840 83,273 - - - 669,579 225,097 - 940,785 - - 365,820 - - - 302,111 - 5,458,379 374,207 667,931 1,067,084 523,992 144,247 (652,141) (990,199) 1,083 198,612 - (199,695) (18,691) - - 10 606 - 388.104 - (189,089) (17,608) 586,716 - 114 Qnl 126.619 (65.425) (990.199) 2,642,767 533,291 170,444 2,077,276 96,521 - - - 2,739,288 533,291 170,444 2,077,276 $ 3,074,191 $ 659,930 $ 105,019 $ 1,087,077 The accompanying notes are an integral part of these statements. 8 Totals - 1,558,650 (Memorandum 2,212,924 Totals Only) 2,061,488 (Memorandum Only) Primary Component Reporting Entity Government Units 2000 1999 $ 4,088,491 $ 679,161 $ 4,767,652 $ 4,292,518 731,488 - 731,488 680,316 626,464 - 626,464 558,904 444,331 - 444,331 379,584 280,026 - 280,026 783,582 422,700 38,927 461,627 523,954 6.593.500 71 R_ORR 7311 _SRR 7 ?1 R RSR 1,558,650 - 1,558,650 1,307,488 2,212,924 - 2,212,924 2,061,488 793,700 - 793,700 806,029 155,814 - 155,814 142,287 259,848 4,643 264,491 278,851 83,273 5,856 89,129 288,419 1,835,461 - 1,835,461 4,244,176 365,820 - 365,820 338,770 302,111 - 302,111 326,950 7,567,601 10,499 7,578,100 9,794,458 (974,101) 707,589 (266,512) (2,575,600) 199,695 - 199,695 - (218,386) - (218,386) 710,806 (686,032) - (398,710) (398,710) (379,130) 398,710 - 398,710 379,130 380,019 (398,710) (18,691) 24,774 (594,082) 308,879 (285,203) (2,550,826) 5,423,778 350,909 5,774,687 8,219,494 96,521 8,746 105,267 169,858 5,520,299 359,655 5,879,954 8,389,352 - - - (63,839) $ 4,926,217 $ 668,534 $ 5,594,751 $ 5,774,687 0 CITY OF SCHERTZ, TEXAS COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL - GENERAL, SPECIAL REVENUE, AND DEBT SERVICE FUND TYPES FOR THE YEAR ENDED SEPTEMBER 30, 2000 Fund Balances - October 1, 1999 2,642,767 Prior Period Adjustment 96,521 Fund Balances - September 30, 2000 $ 3,074,191 The accompanying notes are an integral part of these statements. 10 General Fund Variance Favorable Budget Actual (Unfavorable) REVENUES Taxes $ 3,886,247 $ 4,042,025 $ 155,778 Licenses and Permits 574,165 587,565 13,400 Charges for Services 625,466 626,464 998 Fines and Forfeits 380,000 435,574 55,574 Grants 14,800 17,558 2,758 Other Revenue 276,575 273,185 (3,390) TOTAL REVENUES 5,757,253 5,982,371 225,118 EXPENDITURES Current: General Government 1,696,516 1,452,638 243,878 Public Safety 2,292,186 2,172,342 119,844 Streets and Parks 707,254 671,725 35,529 Health 175,979 155,814 20,165 Culture and Recreation 255,729 253,008 2,721 Management Services 88,376 83,273 5,103 Capital Outlay 449,398 669,579 (220,181) Debt Service: Principal Retirement - - - Interest and Fiscal Charges - - - TOTAL EXPENDITURES 5,665,438 5,458,379 207,059 Excess (Deficiency) of Revenues Over (Under) Expenditures 91,815 523,992 432,177 OTHER FINANCING SOURCES (USES) Operating Transfers In (Out) (191,805) (199,695) (7,890) Operating Transfers In (Out) from Component Units - 10,606 10,606 TOTAL OTHER FINANCING SOURCES (USES) (191,805) (189,089) 2,716 Excess (Deficiency) of Revenues and Other Sources Over (Under) Expenditures and Other (Uses) $ (99,990) 334,903 $ 434,893 Fund Balances - October 1, 1999 2,642,767 Prior Period Adjustment 96,521 Fund Balances - September 30, 2000 $ 3,074,191 The accompanying notes are an integral part of these statements. 10 $ 492,594 11 $ 105,019 Annually Budgeted Special Revenue Funds Debt Service Funds Variance Variance Favorable Favorable Budget Actual (Unfavorable) Budget Actual (Unfavorable) $ 26,000 $ 36,466 $ 10,466 $ - $ _ $ _ 30,000 143,923 113,923 15,600 46,953 31,353 - 15,790 15,790 71,600 227,342 155,742 - 15,790 15,790 26,000 24,734 1,266 - _ _ 4,200 108 4,092 45,000 46,228 (1,228) - _ _ - - - 365,820 365,820 - - - - 299,665 302,111 (2,446) 75,200 71,070 4,130 665,485 667,931 (2,446) (3,600) 156,272 159,872 (665,485) (652,141) 13,344 (1,500) (18,691) (17,191) 191,805 198,612 6,807 - - - 388,105 388,104 (1) (1,500) (18,691) (17,191) 579,910 586,716 6,806 $ (5,100) 137,581 $ 142,681 $ (85,575) (65,425) $ 20,150 355,013 I �n_aa4 $ 492,594 11 $ 105,019 CITY OF SCHERTZ, TEXAS COMBINED STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS - ALL PROPRIETARY FUND TYPES FOR THE YEAR ENDED SEPTEMBER 30, 2000 (With Comparative Totals for the Year Ended September 30, 1999) OPERATING REVENUES Fees Charged to Users Reimbursements and Other TOTAL OPERATING REVENUES OPERATING EXPENSES BEFORE DEPRECIATION Personnel Services Sewage Treatment General and Administrative Contractual Services Supplies /Maintenance Bad Debts TOTAL OPERATING EXPENSES Operating Income (Loss) before Depreciation and Amortization Depreciation and Amortization Operating Income (Loss) NONOPERATING REVENUES (EXPENSES) Interest Income Interest Expense TOTAL NONOPERATING REVENUES (EXPENSES) Net Income (Loss) Before Operating Transfers Operating Transfers In (Out) Net Income (Loss) Add Back of Depreciation Closed to Contributed Capital Total Retained Earnings (Deficit) - October 1 Prior Period Adjustment Retained Earnings (Deficit) - October 1 As Adjusted Total Transfers of Equity Retained Earnings (Deficit) - September 30 1,275,661 59,592 Totals - Enterprise Internal (Memorandum Only) Funds Service 2000 1999 $ 4,545,439 $ 119,669 $ 4,665,108 $ 3,952,044 297,858 - 297,858 203,569 4,843,297 119,669 4,962,966 4,155,613 1,275,661 59,592 820,724 - 362,956 - 833,446 15,686 268,981 28,647 32,412 - 3,594,180 103,925 1,335,253 1,379,783 820,724 550,647 362,956 274,806 849,132 494,026 297,628 375,655 32,412 1 ene I na 45,462 4 l )A '2-Al 1,249,1 17 15,744 1,264,861 1,035,234 519,341 2,818 522,159 522,155 729,776 12,926 742,702 513,079 271,680 818 272,498 191,000 (104,012) - (104,012) (120,483) 167,668 818 168,486 70,517 897,444 13,744 911,188 583,596 18,691 - 18;691 (24,774) 916,135 13,744 929,879 558,822 138,106 - 138,106 138,106 1,054,241 13,744 1,067,985 696,928 4,443,275 (66,411) 4,376,864 3,785,955 - _ - (169,858) 4,443,275 (66,411) 4,376,864 3,616,097 5,497,516 (52,667) 5,444,849 4,313,025 - - 63,839 $ 5,497,516 $ (52,667) $ 5,444,849 $ 4,376,864 The accompanying notes are an integral part of these statements. 12 CITY OF SCHERTZ, TEXAS COMBINED STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES FOR THE YEAR ENDED SEPTEMBER 30, 2000 (With Comparative Totals for the Year Ended September 30, 1999) CASH FLOWS FROM OPERATING ACTIVITIES: Cash Received From Customers Cash Payments to Suppliers for Goods and Services Cash Payments to Employees for Services Cash Received For Reimbursements and Other Net Cash Provided (Used) by Operating Activities CASH FLOWS FROM NON - CAPITAL FINANCING ACTIVITIES Operating Transfers in (Out) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition and Construction of Capital Assets Principal Payments on Long -Tenn Debt Interest Paid on Long -Tenn Debt Capital (Advanced) Received from Joint Venture Capital Received (Contributed) for Capital Assets Net Cash Provided (Used) by Capital and Related Financing Activities CASH FLOWS FROM INVESTING ACTIVITIES Interest on Investments NET INCREASE (DECREASE) IN CASH Cash and Cash Equivalents at October 1 Cash and Cash Equivalents at September 30 Cash Compromised of: Current Assets Restricted Assets Cash and Cash Equivalents - End of Year Enterprise Internal Funds Service Totals (Memorandum Only) 2000 1999 $ 4,351,861 $ 119,669 $ 4,471,530 $ 3,898,865 (1,959,916) (47,582) (2,007,498) (2,095,419) (1,236,780) (59,359) (1,296,139) (1,332,896) 297,858 - 297,858 203,569 1,453,023 12,728 1,465,751 674,119 4,139,733 $ 5,214,972 $ 18,691 - 18,691 (24,774) (262,955) (5,765) (268,720) (503,203) (278,002) (278,002) (276,929) (107,236) - (107,236) (123,064) 742,798 742,798 (742,798) - 63,839 94,605 (5,765) 88,840 (1,582,155) 271,680 818 272,498 191,000 1,837,999 7,781 1,845,780 (741,810) 3,376,973 20,950 3,397,923 4,139,733 $ 5,214,972 $ 28,731 $ 5,243,703 $ 3,397,923 $ 3,287,810 $ 28,731 $ 3,316,541 $ 2,131,259 1,927,162 - 1,927,162 1,266,664 $ 5,214,972 $ 28,731 $ 5,243,703 $ 3,397,923 Continued The accompanying notes are an integral part of these statements. 13 CITY OF SCHERTZ, TEXAS COMBINED STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES (CONTINUED) FOR THE YEAR ENDED SEPTEMBER 30, 2000 (With Comparative Totals for the Year Ended September 30, 1999) RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES Operating Income (Loss) Adjustments to Reconcile Operating Income (Loss) to Net Cash Provided by Operating Activities: Depreciation /Amortization Depreciation Attributed to Contributed Capital Provision for Uncollectible Accounts (Increase) Decrease in the Following Assets Accounts Receivable Inventory Prepaid Expenses Due from Other Funds Increase (Decrease) in the Following Liabilities: Vouchers Payable Due to Other Funds Accrued Vacation Accrued Salaries Salary Reserve Customer Deposit Net Cash Provided (Used) by Operating Activities $ 1,453,023 $ 12,728 $ 1,465,751 $ 674,119 The accompanying notes are an integral part of these statements. 14 Totals Enterprise Internal (Memorandum Only) Funds Service 2000 1999 729,776 12,926 742,702 513,079 381,235 2,818 384,053 384,049 138,106 - 138,106 138,106 32,391 - 32,391 2,620 (338,331) - (338,331) (10,335) 18,506 - 18,506 8,494 (18,306) (737) (19,043) - 444,058 - 444,058 (444,903) 252,876 1,212 254,088 (54,507) (273,227) (3,724) (276,951) 132,196 2,442 (978) 1,464 8,491 5,545 203 5,748 19,198 30,894 1,008 31,902 19,198 47,058 - 47,058 (41,567) $ 1,453,023 $ 12,728 $ 1,465,751 $ 674,119 The accompanying notes are an integral part of these statements. 14 NOTES TO FINANCIAL STATEMENTS 15 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2000 NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial statements of the City of Schertz, Texas, have been prepared in conformity with generally accepted accounting principles (GAAP) as applied to government units. The Government Accounting Standards Board (GASB) is the accepted standard - setting body for establishing government accounting and financial reporting principles. The more significant of the government's accounting policies are described below. REPORTING ENTITY In evaluating how to define the government, for financial purposes, management has considered all potential component units. The decision to include a potential component unit in the reporting entity was made by applying the criteria set forth in GASB Statement 14, "The Financial Reporting Entity ". The definition of the reporting entity is based primarily on the concept of financial accountability. A primary government is financially accountable for the organizations that make up its legal entity. It is also financially accountable for legally separate organizations if its officials appoint a voting majority of an organization's governing body and either it is able to impose its will on that organization or there is a potential for the organization to provide specific financial benefits to, or to impose specific financial burdens on, the primary government. Individual Component Unit Disclosures Discretely presented component units. The component units columns in the combined financial statements include the financial data of the component units of the City of Schertz. Following is a summary of the component units: Schertz Economic Development Corporation: A non profit corporation incorporated under the Development Corporation Act of 1979, Texas Revised Civil Statutes Annotated, Article 5.90.6, Section 4A. The Corporation is organized exclusively for the purpose of promoting economic development in order to eliminate unemployment and underemployment and to promote and encourage employment and public welfare of, for, and on behalf of the City. The Board of Directors consists of seven (7) members appointed by the City Council. 2. Library: The library's governing board is appointed by the City Council. The library provides services to the citizens of the City of Schertz as well as surrounding communities. The function of the Library Board is to work cooperatively with city management to provide funding and oversight for special projects of the Library. Schertz Development Foundation: The Foundation was incorporated under the Texas Non - profit Corporation Act to assist the City in developing and implementing plans for economic viability for the City. The Board of Directors is appointed by the City Council and the executive director is employed by the City. Complete financial statements for each of the three component units may be obtained at City Hall. The following pages present condensed financial statements for each of the discretely presented component units. lime CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL S"TA"TEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 1. REPORTING ENTITY (Continued) CONDENSED BALANCE SHEET Schertz Economic Schertz Development The Development Corporation Library Foundation Total ASSETS Current Assets TOTAL ASSETS LIABILITIES Current Liabilities Due to Primary Government TOTAL LIABILITIES EQUITY Fund Balance TOTAL LIABILITIES AND $ 587,638 $ 35,362 $ 96,266 $ 719,266 $ 587,638 $ 35,362 $ 96,266 $ 719,266 $ - $ 37 $ 40,089 547,549 10,643 - $ 37 50,732 24,719 96,266 668,534 EQUITY $ 587,638 $ 35,362 $ 96,266 $ 719,266 CONDENSED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE Revenues $ 696,527 $ 6,469 $ 15,092 $ 718,088 Expenditures (788) (4,643) (5,068) (10,499) Excess of Revenues Over (Under) Expenditures 695,739 1,826 10,024 707,589 Transfers to Primary Government (388,104) (10,606) - (398,710) Excess (Deficiency) of Revenues and Other Sources Over (Under) Expenditures and Other (Uses) 307,635 (8,780) 10,024 308,879 Fund Balance - Beginning 239,914 33,499 77,496 350,909 Prior Period Adjustment - - 8,746 8,746 Fund Balance - Ending $ 547,549 $ 24,719 $ 96,266 $ 668,534 17 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 1. REPORTING ENTITY (Continued) Joint Venture A joint venture is a legally separate entity that results from a contractual arrangement and that is owned, operated, or governed by two or more participating governments. The following entity meets the criteria for joint ventures: Schertz /Seguin Local Government Corporation: The Corporation is a public, nonprofit corporation organized to aid, assist, and act on behalf of the cities of Schertz and Seguin in acquiring, constructing, maintaining, and operating a water utility system. The participating governments have an ongoing financial responsibility to fund the operation of the corporation through either purchase of services or by subsidizing the operations. Separate financial statements for the Schertz /Seguin Local Government Corporation may be obtained from the City of Seguin, P.O. Box 591, Seguin, Texas 78156. Summarized financial data for the joint venture has been provided in Note K. 2. FUND ACCOUNTING The City's accounts are organized on the basis of funds and account groups, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for by providing a separate set of self - balancing accounts which are comprised of each funds' assets, liabilities, fund equity, revenues, and expenditures or expenses as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purpose for which they are to be spent and the means by which spending activities are controlled. The various funds are grouped, in the financial statements in this report, into six generic fund types and three broad fund categories as follows: Governmental Fund Types: 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. Special Revenue Funds: These funds are used to account for specific revenue sources which are legally restricted to expenditures for specified activities. Debt Service Funds: These funds are used to account for the accumulation of resources for and the payment of principal and interest on general long -term debt of the City other than Revenue Bonds. CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 2. FUND ACCOUNTING (Continued) Governmental Fund Types (Continued): Capital Projects Funds: These funds are established to account for major capital expenditures not financed by proprietary or nonexpendable trust funds. Proprietary Fund Type: Enterprise Fund: The Enterprise Fund accounts for operations which are intended to be self - supporting through user charges. The City operates water and sewer services on this basis. Internal Service Funds: Internal service funds account for operations that provide services to other departments or agencies of the government, or to other governments, on a cost - reimbursement basis. Account Groups: The accounting and reporting treatment applied to the fixed assets and long -term liabilities associated with a fund are determined by its measurement focus. All governmental fund types are accounted for on a spending "financial flow" measurement focus. This means that only current assets and current liabilities are generally included on their balance sheets. Their reported fund balance (net current assets) is considered a measure of "available spendable resources." Governmental fund operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of "available spendable resources" during a period. Property, plant, and equipment used in governmental fund type operations are accounted for in the General Fixed Assets Account Group, rather than in governmental funds. Long -term liabilities expected to be financed from governmental fund types are accounted for in the General Long -Term Debt Account Group, not in the governmental fund. The two account groups are not "funds ". They are concerned only with the measurement of financial position. They are not involved with measurement or results of operations. Wt CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 3. BASIS OF ACCOUNTING Governmental Funds (General, Special Revenue, Debt Service and Capital Projects) are accounted for on a modified accrual basis using a current financial resources measurement focus. Revenues are recognized in the period in which they are both measurable and available and expenditures are recognized when incurred except for interest on general long -term debt which is recognized when due. Sales and property taxes are considered "measurable" when in the hands of intermediary collecting governments and are recognized as revenue at that time. Other revenues susceptible to accrual are franchise taxes, interest, and charges for services. Licenses, fines, and permits are not susceptible to accrual because generally they are not measurable until received in cash. Proprietary Funds have an economic resources measurement focus and use the full accrual method of accounting for both revenues and expenses similar to a commercial enterprise. The City has elected not to follow any pronouncements issued by the Financial Accounting Standards Board (FASB) subsequent to November 30, 1989. 4. CASH AND CASH EQUIVALENTS Cash and cash equivalents include amounts in demand deposits, interest bearing accounts and deposits in local government investment pools. The City is allowed to invest in (1) obligations of the United States or its agencies and instrumentalities; (2) direct obligations of the State of Texas or its agencies; (3) other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the State of Texas of the United States; (4) obligations of states, agencies, counties, cities, and other political subdivisions of any state having been rated as to investment quality by a nationally recognized investment rating firm and having received a rating of not less than "AA" or its equivalent; (5) certificates of deposit issued by state and national banks domiciled in Texas that are guaranteed or insured by the Federal Deposit Insurance Corporation (FDIC) or its successor, or secured by obligations mentioned above; and (6) fully collateralized direct repurchase agreements having a defined termination date. In addition the City invests in local government investment pools. For purposes of the statement of cash flows, the Enterprise Funds and Internal Service Fund considers all highly liquid investments including cash in banks, cash on hand, money market accounts, deposits in local government investment pools, and restricted cash and temporary investments to be cash equivalents. 5. PROPERTY TAXES Property taxes are levied on January 1 of each year on all taxable property within the City. The taxes become due and payable on October 1 following the levy date and delinquent on February 1 of the subsequent year. Penalties and interest are added for payments made after the February 1 due date. The City contracts with the Guadalupe County Tax Assessor - Collector for the billing and collection of the property taxes. Taxes receivable are shown net of the related allowance for uncollectible taxes of $5,311. 20 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 5. PROPERTY TAXES (Continued) For fiscal year 2000, the assessed tax rate for the City was $345572 per $100 on an assessed valuation of $636,157,284. This is broken out as $315125 for general maintenance and operations and $.030447 for debt retirement. 6. ACCOUNTS RECEIVABLE Accounts receivable are reported net of allowances for uncollectible accounts. The allowance account represents management's estimate of uncollectible accounts based upon experience and historical trends. 7. INVENTORIES AND PREPAID ITEMS Inventories are valued at cost, which approximates market, using the first- in/first -out (FIFO) method. The costs of governmental fund -type inventories are recorded as expenditures when consumed rather than when purchased. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items. 8. RESTRICTED ASSETS Certain proceeds of Enterprise Fund revenue bonds, as well as certain resources set aside for their repayment, are classified as restricted assets on the balance sheet because their use is limited by applicable bond convenants. Funds are segregated to report those proceeds of revenue bond issuances that are restricted for use in construction. Funds are also segregated to provide for debt services as provided under bond indenture agreements. 9. FIXED ASSETS Fixed assets are recorded at cost or estimated historical cost if purchased or constructed. Donated fixed assets are recorded at their estimated fair value at the date of donation. Costs incurred for the purchase or construction of general fixed assets are recorded as capital outlay expenditures in the General, Special Revenue, and Capital Projects Funds. All such costs are capitalized in the General Fixed Assets Account Group. Public domain, ( "infrastructure ") general fixed assets consisting of certain improvements other than buildings, including roads, curbs, gutters, streets, and sidewalks, drainage systems, and lighting systems are capitalized. Amounts expended for property, plant, and equipment in the Enterprise Fund are capitalized in the fixed asset accounts within that fund. Interest incurred during the construction phase of proprietary fund fixed assets is reflected in the capitalized value of the asset constructed, net of interest earned on the invested proceeds over the same period. 21 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 10. DEPRECIATION Depreciation and amortization are provided for in the Enterprise Fund in amounts sufficient to relate the cost of fixed assets to operations over their estimated service lives using the straight -line method. Estimated useful lives for Enterprise Fund fixed assets are as follows: Useful Lives Fixed Asset (Years) Buildings 30 Water and sewer lines and mains 50 Equipment 5 -10 No depreciation is provided for the general fixed assets of the City. 11. SALARY RESERVE It is the policy of the City of Schertz to retain as a liability the first forty (40) hours of service for each employee. The liability is to be paid upon termination at the rate of pay in existence at that time. Amounts of salary reserve that are not expected to be liquidated with expendable available financial resources are reported in the General Long -Term Debt Account Group. No expenditure is reported for these amounts. Salary reserve of proprietary funds is recorded as an expense and liability of those funds as the benefits accrue to employees 12. COMPENSATED ABSENCES Vested or accumulated vacation leave and compensatory time that is expected to be liquidated with expendable available resources is reported as an expenditure and fund liability of the governmental fund that will pay for it. Amounts of vested or accumulated vacation leave and compensatory time that are not expected to be liquidated with expendable available financial resources are reported in the General Long -Term Debt Account Group. Vested or accumulated vacation leave and compensatory time of the Proprietary Funds is recorded as an expense and liability of that fund as the benefits accrue to employees. Accumulated vacation pay and compensatory time at September 30, 2000, of $64,409, $2,163 and $235,824 has been recorded in accrued liabilities of the Enterprise Fund, Internal Service Fund, and General Long -Term Debt Account Group, respectively. No liability is recorded for nonvesting accumulating rights to receive sick pay benefits. 13. DEFERRED REVENUE Property tax revenues, are recognized when they become available. Available means when due, or past due, and receivable within the current period and collected within the current period or expected to be collected soon enough thereafter to be used to pay liabilities of the current period. The City recognizes property tax revenues collected within sixty (60) days after year end. 22 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 14. SHORT -TERM OBLIGATION Short-term debt, debt of less than a year duration, is recognized as a liability of the governmental fund that incurred the obligation when the intent is to liquidate the obligation from expendable available resources. 15. LONG -TERM OBLIGATION Long -term debt is recognized as a liability of a governmental fund when due, or when resources have been accumulated in the debt service fund for payment early in the following year. For other long -term obligations, only that portion expected to be financed from expendable available financial resources is reported as a fund liability of a governmental fund. The remaining portion of such obligations is reported in the general long -term debt account group. Long -term liabilities expected to be financed from proprietary fund operations are accounted for in those funds. 16. DEBT SERVICE The ad valorem tax rate is allocated each year between the General Fund and the Debt Service Fund. The full amount estimated to be required for debt service on General Obligation Debt is provided by the debt service tax, together with interest earned within the Debt Service Fund. 17. REVENUE RECOGNITION Water and sewer revenues are based on cycle billings rendered to customers on a monthly basis. Unbilled water and sewer utility service receivables are recorded at year end and are included in customer receivables. 18. FUND EQUITY The unreserved fund balances for governmental funds represent the amount available for budgeting future operations. The reserved fund balances for governmental funds represent the amount that has been legally identified for specific purposes. Designations of fund balance represent tentative management plans that are subject to change. Unreserved retained earnings for the proprietary fund represents the net assets available for future operations or distribution. Reserved retained earnings for the proprietary fund represents the net assets that have been legally identified for specific purposes. The proprietary fund's contributed capital represents equity acquired through capital grants and capital contributions from developers, customers, or other funds. 19. BOND DISCOUNTS /ISSUANCE COSTS In governmental fund types, bond discounts and issuance costs are recognized in the current period. Bond discounts and issuance costs for proprietary fund types are deferred and amortized over the term of the bonds using the bonds - outstanding method, which approximates the effective interest method. Bond discounts are presented as a reduction of the face amount of bonds payable whereas issuance costs are recorded as deferred charges. 23 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 20. COMPARATIVE DATA Comparative total data for the prior year have been presented in selected sections of the accompanying financial statements in order to provide an understanding of the changes in the City's financial position and operations. 21. INTERFUND TRANSACTIONS Quasi - external transactions are accounted for as revenues, expenditures, or expenses. Transactions that constitute reimbursements to a fund for expenditures /expenses initially made from it that are properly applicable to another fund, are recorded as expenditures /expenses in the reimbursing fund and as reductions of expenditures /expenses in the fund that is reimbursed. 22. BUDGETS An operating budget is adopted each fiscal year for the general fund, hotel /motel tax (special revenue) fund, park (special revenue) fund, recycling (special revenue) fund and debt service fund. Annual budgets are not legally required for the other special revenue funds. For capital projects funds, total estimated revenues and other financing sources and estimated expenditures are approved at the inception of each project. Accordingly, no comparison of budget to actual is presented in the annual financial statements for these funds. In addition, as part of the overall budget process, budgets are adopted for the proprietary funds, however, the City does not require a reporting as part of the comprehensive annual financial report. The budget is adopted on the same basis of accounting as described in note A 3. Budgetary preparation and control is exercised at the departmental level. The City Manager is authorized to transfer budget amounts between line items within a department; however, any transfer or supplemental appropriation that amends the total expenditures of a department or total budget requires City Council approval. During the year, the City made various departmental and line item transfers to the budget for the general fund; which had the following effect: General Fund: Revenues Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures Total Original Final Budget Amended Net 10/1/99 Budget Change $ 5,565,666 $ 5,757,253 $ 191,587 5,473,861 5,665,438 191,577 $ 91,805 24 $ 91,815 $ 10 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 22. BUDGETS (Continued) All appropriations lapse at the end of each year. Encumbrances represent commitments related to unperformed contracts for goods or services. Encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditures of resources are recorded to reserve that portion of the applicable appropriation, is utilized in the governmental funds. Encumbrances lapse at year end and do not constitute expenditures or liabilities because the commitments must be reappropriated and honored during the subsequent year. 23. TOTAL COLUMNS Total columns on these statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or changes in financial position in conformity with generally accepted accounting principles. Such data is not comparable to a consolidation, as interfund eliminations have not been made in the aggregation of this information. 24. USE OF 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 the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. NOTE B - DEPOSITS WITH FINANCIAL INSTITUTIONS Deposits consist of demand deposit accounts and interest - bearing accounts and are carried at cost. There are three categories of credit risk that apply to the government's bank balance: 1. Insured or collateralized with securities held by the City or by the City's agent in the City's name. 2. Collateralized with securities held by the pledging financial institution's trust department or the City's agent in the City's name. 3. Uncollateralized. 25 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE B -- DEPOSITS WITH FINANCIAL INSTITUTIONS (Continued) CASH AND CASH EQUIVALENTS Balances held in each category as follows: Insured (FDIC) Unisured: Collateral held by City's Agent in City's Name Total Cash in Banks The book balance is made up as follows: Petty Cash Cash in Banks Total Collaterlized /Insured Deposits Deposits with Local Government Investment Pools Total Primary Government Book Bank Balance Balance $ 124,215 $ 124,215 $ Component Units Book Bank Balance Balance 1,481,839 1,829,877 307,740 327,009 $ 1,606,054 $ 1,954,092 $ 307,740 $ 327,009 The City held deposits in the following local government investment pools: Primary Component Government Units $ 320 $ - 1,606,054 307,740 1,606,374 307,740 Q cIn lnc '2nc ono �y iv,av✓,i vi W v ✓✓, ✓vv Primary Component Government Units Local Government Investment Cooperative (LOGIC) $ 3,074,781 $ 88,319 MBIA Municipal Investors Service Corporation 483,683 257,527 Lone Star Investment Pool 5,020,931 - Total $ 8,579,395 $ 345,846 All three investment pools have regulatory oversight from the Texas Public Funds Investment Act Sec. 2256.0016. The fair value of the City's position in each pool is the same as the value of the pool shares. The City is authorized to make direct investments in U.S. Government, federal agency and instrumentality obligations, certificates of deposit, and local government investment pools. Investments represented by specific identifiable investment securities are classified as to credit risk by the three (3) categories described below: 26 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE B -- DEPOSITS WITH FINANCIAL INSTITUTIONS (Continued) Category 1 - Insured, or registered, or securities held by the City or its agent in the City's name. Category 2 - Uninsured and unregistered, with securities held by the counterparty's trust department or agent in the City's name. Category 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent, but not in the City's name. As of September 30, 2000, no securities were held that would be subject to credit risk as defined above. NOTE C -- CHANGES IN FIXED ASSETS Activity for general fixed assets capitalized by the City is summarized below: Balance Balance 10/1/1999 Adjustments Additions Deletions 9/30/2000 Land $ 997,173 $ - $ 472,688 $ (4,480) $ 1,465,381 Buildings 4,216,586 - 1,383,360 - 5,599,946 Improvements Other Than Buildings 8,555,316 - 1,224,315 - 9,779,631 Vehicles 1,394,066 (531,255) - - - Equipment 1,639,022 267,321 20,619 (17,631) 1,909,331 $ 16,802,163 $ (263,934) $ 3,100,982 $ (22,111) $ 19,617,100 Adjustments were made to the beginning fixed asset balances to reflect changes in capitalization policies, disposition of assets in previous years, and re- classifications. The following is a summary of the Enterprise Fund property plant, and equipment at September 30, 2000: Enterprise Internal Land and Improvements Buildings Improvements Other than Buildings Machinery, Equipment, and Vehicles Less Accumulated Depreciation Net Property, Plant, and Equipment $ 160,521 $ - $ 195,724 26,656 10,964,007 7,642 1,020,300 625,108 12,340,552 659,406 27 - $ 160,521 58,804 281,184 1,142 10,972,791 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE D -- LONG -TERM DEBT The City had the following changes in long -term debt outstanding for the year ended September 30, 2000: Balance Balance Outstanding Outstanding Original Interest October 1, September 30. Amount Rates 1999 Issued Retired 2000 General Long -Term Debt General Obligation Bonds 1962 Series 1987 Series 1992 Series 1998 Series 1995 Refunding Bonds Certificates of Obligation 1990 Series Total General Obligation Debt $ 301,000 3.63% $ 24,000 $ 454,000 6.2 -8.3% 45,000 620,000 5.2 -7.2% 495,000 4,930,000 4.37 - 5.375% 4,790,000 447,000 3.75 -5.00% 268,230 5,622,230 Compensated Absences Payable Salary Reserve Total General Long -Term Debt Proprietary Fund Debt Revenue Bonds: 1987 Series Certificate of Obligation: 1992 Series General Obligation Bonds: 1995 Refunding Bonds Other Debt: Public Facility Loan (HUD) Note Payable Total Proprietary Fund Debt 850,000 7.0 -9.0% 215,000 5,837,230 $ 14,000 $ 10,000 - 45,000 - - 25,000 470,000 - 145,000 4,645,000 - 71,820 196,410 300,820 5,321,410 65,000 150,000 365,820 5,471,410 186,793 49,031 - 235,824 46,558 76,166 - 122,724 $ 6,070,581 $ 125,197 $ 365,820 $ 5,829,958 1,020,000 6.3 -8.3% $ 820,000 $ - $ 35,000 $ 785,000 200,000 5.0 -7.0% 140,000 - 10,000 130,000 1,253,000 3.75 -5.0 741,770 - 198,180 543,590 142,000 5.00% 67,000 - 5,000 62,000 273,000 7.60% 96,491 - 29,821 66,670 $ 1,865,261 $ - $ 278,001 $ 1,587,260 28 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE D -- LONG -TERM DEBT (Continued) Debt Service Requirements The following are summaries of debt service requirements to maturity for long -term bonds, certificates, and notes for the General Long -Term and Proprietary Fund Debt: SUMMARY OF DEBT SERVICE REQUIREMENTS TO MATURITY FOR GENERAL LONG -TERM DEBT Year Ending September 30, Principal Interest Total 2001 $ 343,680 $ 278,461 $ 622,141 2002 297,610 258,524 556,134 2003 254,260 241,959 496,219 2004 257,930 226,349 484,279 2005 272,930 210,064 482,994 2006 305,000 193,566 498,566 2007 315,000 171,928 486,928 2008 300,000 151,394 451,394 2009 240,000 133,933 373,933 2010 255,000 120,673 375,673 2011 270,000 109,156 379,156 2012 285,000 97,006 382,006 2013 300,000 84,209 384,209 2014 315,000 70,766 385,766 2015 335,000 56,547 391,547 2016 355,000 41,453 396,453 2017 375,000 25,484 400,484 2018 395,000 8,641 403,641 $ 5,471,410 $ 2,480,113 $ 7,951,523 Average annual requirements $ 441,751 29 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE D -- LONG -TERM DEBT (Continued) SUMMARY OF DEBT SERVICE REQUIREMENTS TO MATURITY FOR PROPRIETARY FUND DEBT Year Ending September 30, Principal Interest Total 2001 $ 328,426 $ 91,502 $ 419,928 2002 286,954 78,490 365,444 2003 270,740 58,168 328,908 2004 207,070 42,156 249,226 2005 207,070 29,652 236,722 2006 130,000 18,975 148,975 2007 130,000 10,163 140,163 2008 5,000 1,350 6,350 2009 5,000 1,100 6,100 2010 5,000 850 5,850 2011 5,000 600 5,600 2012 5,000 350 5,350 2013 2,000 100 2,100 $ 1,587,260 $ 333,456 $ 1,920,716 Average annual requirements $ 147,747 Bonded debt of the City consists of various series of general obligation bonds, revenue bonds, certificates of obligation, public facility loan (HUD), and a note payable. General obligation bonds are direct obligations of the City for which its full faith and credit are pledged, and are payable from taxes levied on all taxable property located within the City. Revenue bonds are generally payable from pledged revenues generated by the water and sewer fund. The debenture agreement for water and sewer bonds require funds be available for 1 /12th the principal and 1 /6th interest requirements of the next fiscal year. Certificates of obligation are payable from a levy of ad valorem taxes upon all taxable property within the City, and are further payable from certain net revenues derived from the operation of the City's combined water and sewer systems after operations of the water and sewer systems and has equal status with first lien revenue bonds. The note payable is payable from revenues generated by the water and sewer fund. The City is mandated to maintain revenue reserves at least 1.5 times the average annual revenue bond debt service requirements. The City was in compliance. As of September 30, 2000, outstanding general obligation bonds of $740,000 are considered to be defeased. These are analyzed by fund types as follows: Water and Sewer Fund General Long -Term Debt Group 30 $ 543,590 196,410 $ 740,000 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE E -- RETIREMENT PLAN Texas Municipal Retirement Fund: Plan Description The City provides pension benefits for all of its full -time employees through a nontraditional, joint contributory, hybrid defined benefit plan in the state -wide Texas Municipal Retirement System (TMRS), one of over 731 administered by TMRS, an agent multiple- employer public employee retirement system. TMRS issues a publicly available financial report that includes financial statements and required supplementary information for TMRS. That report may be obtained by writing to Texas Municipal Retirement System, P.O. Box 149153, Austin, Texas 78714. 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 date the plan began, the City granted monetary credits for service rendered before the plan began of a theoretical amount equal to two times what would have been contributed by the employee, with interest, prior to establishment of the plan. Monetary credits for service since the plan began are a percent (100 %, 150 %, or 200 %) of the employee's accumulated contributions. In addition, the City can grant, as often as annually, another type of monetary credit referred to as an updated service credit which is a theoretical amount which, when added to the employee's accumulated contributions and the monetary credits for service since the plan began, would be the total monetary credits and employee contributions accumulated with interest if the current employee contribution rate and City matching percent had always been in existence and if the employee's salary had always been the average of his salary in the last three years that are one year before the effective date. At retirement, the benefit is calculated as if the sum of the employee's accumulated contributions with interest and the employer - financed monetary credits with interest were used to purchase an annuity. Members can retire at age 60 and above with 10 or more years of service or with 25 years of service, regardless of age. A member is vested after 10 years. The plan provisions are adopted by the governing body of the City, within the options available in the state statutes governing TMRS and within the actuarial constraints also in the statutes. Contributions The contribution rate for the employees is 5 %, and the City matching percent is currently 1.5 to 1, 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 the City matching percent, which are the obligation of the City as of an employee's retirement date, not at the time the employee's contributions are made. The normal cost contribution rate is the actuarially determined percent of payroll necessary to satisfy the obligation of the City to each employee at the time his /her retirement becomes effective. The prior service contribution rate amortizes the unfunded (overfunded) actuarial liability (asset) over the remainder of the plan's 25 -year amortization period. The unit credit actuarial cost method is used for determining the City contribution rate. 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 delay between the actuarial valuation that is the basis for the rate and the calendar year when the rate goes into effect (i.e., December 31, 1999 valuation is effective for rates beginning January 2001). 31 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE E -- RETIREMENT PLAN (Continued) Texas Municipal Retirement Fund: (Continued) Contributions (Continued) For 1999, the City's annual pension cost of $252,975 was equal to the City's required and actual contributions. The actuarial assumptions included (a) 8% investment rate of return, (b) no projected salary increases, (c) no inflation component and (d) the amortization period is open. The actuarial value of TMRS assets was determined based on market - related values. Schedule of Actuarial Liabilities and Funding Progresi Actuarial Valuation Date Actuarial Value of Assets Actuarial Accrued Liability Percentage Funded Unfunded (Overfunded) Actuarial Accrued Liability (UAAL) Annual Covered Payroll UAAL as a Percentage of Covered Payroll Net Pension Obligation (NPO) at the Beginning of Period Annual Pension Cost: Annual Required Contribution (ARC) Interest on NPO Adjustment to the ARC Contributions Made Increase in NPO NPO at the End of Period Trend Information The six year historical trend information is being developed prospectively. The information for the last six years is as follows: ACTUARIAL VALUATION DATE DECEMBER 31, 1999 1998 1997 1996 1995 1994 Net Assets Available for Benefits as a Percentage of the Pension Benefit Obligation Unfunded Pension Benefit Obligation as a Percentage of Covered Payroll Employer Contributions as a Percentage of Covered Payroll 56.40% 53.26% 55.94% 50.75% 47.05% 36.51% 40.10% 36.03% 28.08% 25.09% 30.97% 30.18% 7.55% 7.20% 5.28% 5.46% 5.09% 4.97% 32 12/31/99 12/31/98 12/31/97 $ 1,734,692 $ 2,434,873 $ 951,784 $ 3,076,611 $ 1,296,918 $ 1,701,471 56.4% 53.3% 55.9% $ 1,341,919 $ 1,137,955 $ 749,687 $ 3,349,515 $ 3,158,499 $ 2,669,695 40.1% 36.0% 28.1% $ 252,975 $ 227,548 $ 140,886 $ 140,886 $ 227,548 $ 252,975 Trend Information The six year historical trend information is being developed prospectively. The information for the last six years is as follows: ACTUARIAL VALUATION DATE DECEMBER 31, 1999 1998 1997 1996 1995 1994 Net Assets Available for Benefits as a Percentage of the Pension Benefit Obligation Unfunded Pension Benefit Obligation as a Percentage of Covered Payroll Employer Contributions as a Percentage of Covered Payroll 56.40% 53.26% 55.94% 50.75% 47.05% 36.51% 40.10% 36.03% 28.08% 25.09% 30.97% 30.18% 7.55% 7.20% 5.28% 5.46% 5.09% 4.97% 32 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE F -- INTERFUND RECEIVABLES AND PAYABLES Interfund balances as of September 30, 2000 consisted of the following receivables and payables: Due From Due To General Fund Special Revenue Funds: Library Grant Fund $ 8,000 $ - Police Department Forfeitures - 1,083 Tax Increment Financing - 10,000 Debt Service Fund 38,662 - Capital Projects Funds 8,000 - Proprietary Funds: Water and Sewer Enterprise Fund - 83,996 Safes Enterprise Fund 8,256 - Fleet Services Internal Service Fund 67,522 - 130,440 95,079 Special Revenue Funds Tax Increment Financing: General 10,000 - Library Grant Fund: General - 8,000 Police Department Forfeitures: General 1,083 - Recycling Fund: Water and Sewer Enterprise Fund - 18,691 1998 FEMA Water and Sewer Enterprise Fund - 20,000 11,083 46,691 Debt Service Fund General Fund - 38,662 Water and Sewer Enterprise Fund - 41,093 - 79,755 Capital Projects Fund General Fund - 8,000 Enterprise Fund Water and Sewer Enterprise Fund General 83,996 - Recycling (Special Revenues) Fund 18,691 - 1998 FEMA (Special Revenue) Fund 20,000 - Debt Service Fund 41,093 - Safes Enterprise Fund General - 8,256 163,780 8,256 Internal Service Fund General - 67,522 TOTAL INTERFUND RECEIVABLES AND PAYABLES $ 305,303 $ 305,303 33 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE F -- INTERFUND RECEIVABLES AND PAYABLES (Continued) Due From Due To General Fund Schertz Economic Development Corp Library Schertz Economic Development Corp General Fund Library General Fund TOTALS NOTE G -- OPERATING TRANSFERS Primary Government $ 40,089 $ - 10,606 - - 40,089 - 10,606 $ 50,695 $ 50,695 Transfers Transfers General Fund $ - $ 199,695 Special Revenue Funds: Sewer Safes Service Police Department Forfeiture Fund Fund 1,083 Fund - Recycling Fund $ (138,106) - $ - 18,691 Debt Service Fund 3,826,862 198,612 63,577 - Proprietary Funds: Water and Sewer Enterprise Fund $ 3,688,756 18,691 $ 63,577 - TOTALS $ 218,386 $ 218,386 Primary Government and Component Unit General Fund $ 10,606 $ - Debt Service Fund 388,104 - Library - 10,606 Schertz Economic Development Corporation - 388,104 TOTALS $ 398,710 $ 398,710 NOTE H -- CONTRIBUTED CAPITAL Changes to contributed capital during the year are as follows: 34 Water And Internal Sewer Safes Service Fund Fund Fund Total Depreciation of Contributed Assets $ (138,106) $ - $ - $ (138,106) Contributed Capital - October 1 3,826,862 226,769 63,577 $ 4,117,208 CONTRIBUTED CAPITAL - SEPTEMBER 30 $ 3,688,756 $ 226,769 $ 63,577 $ 3,979,102 34 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE I -- SEGMENT INFORMATION — ENTERPRISE FUNDS The City has two (2) enterprise operations which provide water /sewer and emergency ambulance services. Segment information for the twelve month period ended September 30, 2000, is as follows: Operating Revenues Operating Expenses, Exclusive of Depreciation and Amoritzation Depreciation and Amortization Operating Income Other Income (Expense) Operating Transfers In (Out) Net Income Total Assets Total Equity Working Capital Additions to Fixed Assets Outstanding Debt NOTE J -- RISK MANAGEMENT Water /Sewer Safes Total $ 3,958,054 $ 885,243 $ 4,843,297 (2,717,774) (876,406) (3,594,180) (480,922) (38,419) (519,341) 759,358 (29,582) 729,776 156,461 11,207 167,668 18,691 - 18,691 $ 934,510 $ (18,375) $ 916,135 $ 11,186,676 $ 650,874 $ 11,837,550 $ 8,837,112 $ 575,929 $ 9,413,041 $ 3,364,012 $ 344,052 $ 3,708,064 $ 201,486 $ 61,469 $ 262,955 $ 1,587,260 $ - $ 1,587,260 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 contracts with the Texas municipal League Intergovernmental Risk Pool, a public entity risk pool currently operating as a common risk management and insurance program providing insurance coverage in the following areas: general liability, automobile liability and physical damage, law enforcement liability, workers compensation, real and personal property, mobile equipment, and errors and omissions liability. The agreement for formation of the Texas Municipal League Intergovernmental Risk pool provides that the pool will be self - sustaining through member premiums and will be adjusted annually through an experience modifier. The City continues to carry commercial insurance for all other risks of loss including public official bond, employee dishonesty blanket bond, and underground tank pollution liability. Settled claims resulting from these risks have not exceeded commercial insurance coverage in any of the past three (3) fiscal years. The pooling agreement requires the pool to be self - sustaining. It is not possible to estimate the amount of any losses for which the City might be liable. The Texas Municipal League Intergovern mental Risk Pool has published its own financial report for the year ended September 30, 2000, which can be obtained from the Texas Municipal League. 35 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE J -- RISK MANAGEMENT (CONT.) Vehicles owned by the City that are older than four (4) years are covered by liability insurance only. The City has elected to supplement this coverage by designating $350,000 of general fund equity in the event it is needed. To date no claims have been made on this reserve and none exists as of September 30, 2000. NOTE K -- COMMITMENTS AND CONTINGENCIES Schertz /Seguin Local Government Corporation The City of Schertz is jointly liable, together with the City of Seguin, for operating deficits and long -term debt of the Schertz /Seguin Local Government Corporation (See Note Al). Following is a summary of financial data as reported in the Corporation's audited financial statements dated September 30, 2000: ASSETS: Current Assets $ 3,612,244 Restricted Cash and Equivalents 525,720 Projects in Progress 1,809,604 Land 3,539,631 Other Assets 963,902 TOTAL ASSETS $ 10,451,101 LIABILITIES & RETAINED EARNINGS Current Liabilities $ 520,431 Bonds Payable 10,000,000 TOTAL LIABILITIES 10,520,431 Retained Earnings (Deficit) TOTAL LIABILITIES & RETAINED EARNINGS (69,330) $ 10,451,101 The Corporation issued $10,000,000 in revenue bonds for the purpose of developing an alternate water system. The bonds are backed by the revenues derived from existing water systems of the Cities of Schertz and Seguin. Contracts The City has entered into construction contracts for the purpose of city hall renovations in the amount of $315,636 (including contracted architectural fees). As of September 30, 2000, the City had incurred $274,361 of the total contracts, with an estimated future commitment of $41,275. Litigation The City is the subject of various claims and litigation that have arisen in the course of its operations. Management is of the opinion that the City's liability in these cars, if decided adversely to the City, will not have a material effect on the City's financial position. 36 CITY OF SCHERTZ, TEXAS NOTES TO FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2000 NOTE L - PRIOR PERIOD ADJUSTMENT Primary Government In the financial statements for the year ended September 30, 1999, an error was made in accounting for sales tax revenue and receivables in the general fund. Sales tax receivable in the amount of $96,521 was not recorded in the proper period. The error has been corrected and has had the following effect on the beginning fund balance: Beginning fund balance (as previously reported) $ 2,642,767 Adjustment of sales tax revenue /receivable 96,521 Beginning fund balance (as corrected) $ 2,739,288 Component Unit In the financial statements for the year ended September 30, 1999 an error was made in accounting for inventory of land held for sale in the Schertz Development Foundation. Land purchased by the Foundation for the purpose of industrial development is held for sale at reduced prices to entice manufactures and other employers to locate in Schertz, Texas. The error has been corrected and has had the following effect on the beginning fund balance: Beginning fund balance (as previously reported) Adjustment of land inventory Beginning fund balance (as corrected) NOTE M -- DEFICIT RETAINED EARNINGS $ 77,496 8,746 $ 86,242 For the year ended September 30, 2000, the Internal Service Fund has a deficit retained earnings balance of $52,667. The deficit has occurred over several years as a result of insufficient transfers from user funds to meet expenses of the fleet services provided by the Internal Service Fund. The City plans to adjust transfers from other funds to offset deficits. NOTE N -- SUBSEQUENT DISCOVERY OF FACTS Subsequent to the issuance of the City of Schertz, Texas' general - purpose financial statements, management became aware of certain errors resulting in an overstatement of accounts payable and current expenditures in the Capital Projects Fund. The error occurred because the payments for contracted construction were properly accrued at September 30, 1999, but were subsequently recorded as current expenditures in 2000. The correction of the error in the revised financial statements has the effect of decreasing current liabilities in the Capital Projects Fund by $1,035,262 at September 30, 2000, and increasing the fund balance for 2000 by $1,035,262. 37 This page intentionally left blank COMBINING AND INDIVIDUAL FUND AND ACCOUNT GROUP FINANCIAL STATEMENTS AND SCHEDULES 38 This page intentionally left blank GENERALFUND 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. 39 This page intentionally left blank CITY OF SCHERTZ, TEXAS GENERALFUND COMPARATIVE BALANCE SHEETS SEPTEMBER 30, 2000 AND 1999 ASSETS Cash and Cash Equivalents Delinquent Taxes Receivable (Net of Allowances of $4,750) Accounts Receivable Due from Other Funds Due from Component Unit Inventory of Supplies, at Cost Prepaid Items TOTAL ASSETS LIABILITIES AND FUND BALANCE Liabilities Vouchers Payable Accrued Salaries and Benefits Bond Escrow Due to Other Funds Deferred Revenue Total Liabilities Fund Balance Reserved for Forfeited Property Reserved for Inventory of Supplies Reserved for Municipal Court Unreserved: Designated for Economic Development Designated for Equipment Replacement Designated for Self- Insurance Designated for A/C Replacement Designated for Street Repair Designated for Vehicle Replacement Designated for Contingencies Designated for Police Building Undesignated Total Fund Balance TOTAL LIABILITIES AND FUND BALANCE 40 September 30, 2000 1999 $ 2,988,694 $ 3,040,504 81,041 90,241 233,609 81,921 130,440 - 50,695 32,600 14,315 16,252 47,975 - $ 3,546,769 $ 3,261,518 226,350 57,608 12,500 95,079 81,041 A l'7 C70 19,814 14,315 24,103 18,821 231,472 350,000 70,000 178,655 1,420,000 645 746,366 4 W7A 101 $ 80,728 46,558 401,224 90,241 618,751 19,814 16,252 18,821 16,144 45,000 121,710 69,562 $ 3,546,769 $ 3,261,518 CITY OF SCHERTZ, TEXAS GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL YEAR ENDED SEPTEMBER 30, 2000 (WITH COMPARATIVE ACTUAL AMOUNTS FOR THE YEAR ENDED SEPTEMBER 30, 1999) REVENUES Taxes Licenses and Permits Charges for Services Fines and Forfeits Grants Other Revenue TOTAL REVENUES EXPENDITURES Current General Government Public Safety Streets and Parks Health Culture and Recreation Management Services Capital Outlay Debt Service TOTAL EXPENDITURES Excess (Deficiency) of Revenues Over (Under) Expenditures OTHER FINANCING SOURCES (USES) Operating Transfers In Operating Transfers (Out) Operating Tansfers (to) from Component Unit TOTAL OTHER FINANCING SOURCES (USES) Excess (Deficiency) of Revenues and Other Sources Over (Under) Expenditures and Other (Uses) Fund Balance - October 1 Prior Period Adjustment Fund Balance - September 30 2000 Variance Favorable Budget Actual (Unfavorable) $ 3,886,247 $ 4,042,025 $ 155,778 574,165 587,565 13,400 625,466 626,464 998 380,000 435,574 55,574 14,800 17,558 2,758 276,575 273,185 (3,390) 5,757,253 5,982,371 225,118 1000 Aohinl $ 3,565,950 680,316 558,904 369,255 470,100 7n7 R27 1,696,516 1,452,638 243,878 1,306,500 2,292,186 2,172,342 119,844 2,023,379 707,254 671,725 35,529 472,408 175,979 155,814 20,165 142,287 255,729 253,008 2,721 274,865 88,376 83,273 5,103 85,845 449,398 669,579 (220,181) 922,721 - - - 3,109 5,665,438 5,458,379 207,059 5,231,114 01 R 1 5 G71 007 A V) 177 (,7 1 7d2 - 4,800 (191,805) (199,695) (7,890) (681,232) - 10,606 10,606 (13,059) (191,805) (189,089) 2,716 (689,491) $ (99,990) 334,903 $ 434,893 (68,248) 2,642,767 2,711,015 96,521 - $ 3,074,191 $ 2,642,767 41 CITY OF SCHERTZ, TEXAS GENERALFUND SCHEDULE OF REVENUES COMPARED TO BUDGET YEAR ENDED SEPTEMBER 30, 2000 (WITH COMPARATIVE ACTUAL AMOUNTS FOR THE YEAR ENDED SEPTEMBER 30, 1999) 42 Variance Favorable REVENUES Budget Actual (Unfavorable) Actual Taxes: Ad Valorem $ 2,205,972 $ 2,187,164 $ (18,808) $ 1,932,632 Tax Penalty 24,100 26,244 2,144 30,673 City Sales Tax 1,200,000 1,361,537 161,537 1,219,983 Utility Franchise 448,475 459,495 11,020 378,341 Other 7,700 7,585 (115) 4,322 Total Taxes 3,886,247 4,042,025 155,778 3,565,951 Licenses and Permits 574,165 587,565 13,400 680,316 Charges for Services: Utility Administration 362,956 362,956 - 265,000 Swimming Pool 30,350 30,335 (15) 33,942 Animal Shelter 79,000 79,282 282 21,760 Building Rental 12,775 13,217 442 9,299 Library and Fire 133,965 133,965 - 116,686 Other 6,420 6,709 289 112,217 Total Charges for Service 625,466 626,464 998 558,904 Fines and Forfeitures 380,000 435,574 55,574 369,255 Grants 14,800 17,558 2,758 470,100 Other Revenue: Reimbursements 17,500 17,402 (98) 10,582 Proceeds from Litigation 30,000 30,217 217 - Cibolo Creek Municipal Authority 6,200 6,169 (31) 5,954 Interest 200,000 199,990 (10) 152,561 Sale of Merchandise 600 588 (12) 25,497 Miscellaneous 22,275 18,819 (3,456) 13,238 Total Other Revenue 276,575 273,185 (3,390) 207,832 TOTAL REVENUES $ 5,757,253 $ 5,982,371 $ 225,118 $ 5,852,358 42 CITY OF SCHERTZ, TEXAS GENERAL FUND SCHEDULE OF CURRENT EXPENDITURES COMPARED TO BUDGET YEAR ENDED SEPTEMBER 30, 2000 (WITH COMPARATIVE ACTUAL AMOUNTS FOR THE YEAR ENDED SEPTEMBER 30, 1999) 2000 1999 W Variance Favorable Budget Actual (Unfavorable) Actual CURRENT General Government City Council $ 18,800 $ 15,144 $ 3,656 $ 14,345 City Manager 229,284 228,752 532 137,187 Business Office 216,525 217,362 (837) 105,319 Planning and Zoning 137,548 132,319 5,229 128,939 Legal 99,000 82,990 16,010 100,266 Municipal Court 178,921 148,575 30,346 149,430 Municipal Building 179,550 182,055 (2,505) 174,332 General Administration 88,936 78,217 10,719 91,563 Finance 151,932 130,643 21,289 157,265 Other - Unclassified 396,020 236,581 159,439 247,854 Total General Government 1,696,516 1,452,638 243,878 1,306,500 Public Safety Police Department 1,473,804 1,373,654 100,150 1,290,320 Fire Department 657,421 644,210 13,211 591,026 Inspection 160,961 154,478 6,483 142,033 Total Public Safety 2,292,186 2,172,342 119,844 2,023,379 Streets and Parks Streets 587,613 571,690 15,923 372,134 Parks 119,641 100,035 19,606 100,274 Total Streets and Parks 707,254 671,725 35,529 472,408 Health Animal Control 175,979 155,814 20,165 142,287 Culture and Recreation Swimming Pool 65,915 65,702 213 66,325 Library 189,814 187,306 2,508 208,540 Total Culture and Recreation 255,729 253,008 2,721 274,865 Management Services 88,376 83,273 5,103 85,845 Capital Outlay 449,398 669,579 (220,181) 922,721 Debt Service Interest - - - 3,109 Total Expenditures $ 5,665,438 $ 5,458,379 $ 207,059 $ 5,231,114 W SPECIAL REVENUE FUNDS Special Revenue funds account for the proceeds of specific revenues (other than expendable trusts or for major capital projects) that are legally restricted to expenditure for specified purposes. Park Fund - to account for revenues from developers' fees (in lieu of park land dedication), grants, and donations and designed to monitor and manage improvement of park system. Recycling Fund - to account for revenues received from the recycling fee on all residential water bills and the sale of recyclable material and used to buy down solid waste collection costs. Tax Increment Financing Fund — to account for the proceeds of designated property taxes to be used for the widening of Schertz Parkway. 1998 FEMA Fund — to account for the funds received from the Federal Emergency Management Association which are used to repair damages incurred in the flood of 1998. Hotel Occupancy Tax Fund — to account for proceeds of hotel occupancy taxes to be used strictly for those kinds of programs that promote the tourism industry. Library Grant Fund — to account for funds from a state grant to be used for purchasing computers at the library to be used for access to the internet. Police Department Forfeitures Fund - to account for revenue received from drug related cases in conjunction with other law enforcement agencies. .. CITY OF SCHERTZ COMBINING BALANCE SHEET SPECIAL REVENUE FUNDS SEPTEMBER 30, 2000 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1999) ASSETS Cash and Cash Equivalents Accounts Receivable Due from Other Funds TOTAL ASSETS LIABILITIES AND FUND BALANCE Liabilities Accounts Payable Due to Other Funds Total Liabilities Fund Balance Unreserved Designated TOTAL LIABILITIES AND FUND BALANCE 45 Tax Park Recycling Increment $ 304,114 $ 50,948 $ 108,273 $ 304,114 $ 50,948 $ 118,273 $ 206 $ 1,677 $ - 206 20,368 - 303,908 30,580 118,273 $ 304,114 $ 50,948 $ 118,273 Police Hotel Library Department 1998 Occupancy Grant Forfeitures FEMA Tax Fund Fund Totals 2000 1999 $ 4,430 $ 158,856 $ 20,447 $ 16,731 $ 6639799 $ 600,235 36,419 - - - 36,419 - 40,849 158,856 20,447 $ 17,814 $ 711,301 $ 689,870 $ 2,047 $ 750 $ - $ - $ 4,680 $ 92,611 20,000 - 8,000 - 46,691 63,968 22,047 750 8,000 - 51,371 156,579 18,802 158,106 12,447 17,814 659,930 533,291 40,849 $ 158,856 $ 20,447 $ 17,814 $ 711,301 $ 689,870 46 CITY OF SCHERTZ COMBINING STATEMENT OF REVENUE, EXPENDITURES, AND CHANGES IN FUND - BALANCES, SPECIAL REVENUE FUNDS SEPTEMBER 30, 2000 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1999) REVENUES Other Taxes Developer Fees Property Forfeitures Grants Donations Sale of Recycling Materials Interest TOTAL REVENUES EXPENDITURES General and Administrative Streets and Parks Contractual Services Capital Outlay TOTAL EXPENDITURES Excess (Deficency) of Revenues Over Expenditures OTHER FINANCING SOURCES (USES) Transfers In Transfers (Out) Total Expenditures Excess (Deficency) of Revenues and Other Sources Over (Under) Expenditures and Other (Uses) Fund Balance - October I Residual Equity Transfer In (Out) Fund Balances - September 30 47 Tax Park Recycling Increment $ - $ - $ 10,000 143,923 - - 30,256 - 0A T7 - 108 - - - 19,770 1,716 46,228 - - 107,214 10,486 13,496 (18,691) - (18,691) - 107,214 (8,205) 13,496 196,694 38,785 104,777 $ 303,908 $ 30,580 $ 118,273 Hotel 1998 Occupancy FEMA Tax $ - $ 36,466 $ 224,841 - Police Library Department Grant Forfeitures Totals - $ - $ 46,466 $ 105,566 143,923 69,107 - 8,757 8,757 10,329 37,627 - 262,468 313,482 - - - 250 - - 30,256 7,839 $ 228,354 $ 43,536 $ 37,627 $ 9,919 $ 518,454 $ 528,184 300 4,964 - 277 5,649 10,159 121,975 - - - 121,975 224,488 - - - - 21,486 112,397 149,105 - 26,032 3,732 225,097 179,790 271,380 4,964 26,032 4,009 374,207 526,834 (43,026) 38,572 11,595 5,910 144,247 1,350 - - - 1,083 1,083 150,562 - - - - (18,691) (4,800) - - - 1,083 (17,608) 145,762 (43,026) 38,572 11,595 6,993 126,639 147,112 61,828 119,534 852 10,821 533,291 450,018 - - - - - (63,839) $ 18,802 $ 158,106 $ 12,447 $ 17,814 $ 659,930 $ 533,291 .• CITY OF SCHERTZ, TEXAS PARK SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL YEAR ENDED SEPTEMBER 30, 2000 REVENUES Developer Fees Interest Income TOTAL REVENUES EXPENDITURES Contractual Services Capital Outlay TOTAL EXPENDITURES Excess (Deficiency) of Revenues Over (Under) Expenditures Fund Balance - October 1, 1999 Fund Balance - September 30, 2000 Budget $ 30,000 4,000 34,000 4,200 45,000 49,200 $ (15,200) 49 Actual $ 143,923 9,627 153,550 108 46,228 46,336 107,214 196,694 $ 303,908 Variance Favorable (Unfavorable) $ 113,923 5,627 119,550 4,092 (1,228) 2,864 $ 122,414 CITY OF SCHERTL RECYCLING SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE — BUDGET AND ACTUAL YEAR ENDED SEPTEMBER 30, 2000 50 Variance Favorable Budget Actual (Unfavorable) REVENUES Sale of Recycling Materials $ 7,500 $ 30,256 $ 22,756 TOTAL REVENUES 7,500 30,256 22,756 EXPENDITURES Contractual Services 6,000 19,770 (13,770) TOTAL EXPENDITURES 6,000 19,770 (13,770) Excess (Deficiency) of Revenues Over (Under) Expenditures 1,500 10,486 8,986 OTHER FINANCING SOURCES (USES) Operating Transfers In (Out) (1,500) (18,691) (17,191) TOTAL OTHER FINANCING SOURCES (USES) (1,500) (18,691) (17,191) Excess (Deficiency) of Revenues and Other Sources Over (Under) Expenditures and Other (Uses) $ - (8,205) $ (8,205) Fund Balance - October 1, 1999 38,785 Fund Balance - September 30, 2000 $ 30,580 50 CITY OF SCHERTZ HOTEL OCCUPANCY TAX SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE — BUDGET AND ACTUAL YEAR ENDED SEPTEMBER 30, 2000 51 Variance Favorable Budget Actual (Unfavorable) REVENUES Sale of Recycling Materials $ 26,000 $ 36,466 $ 10,466 Interest Income 4,100 7,070 2,970 TOTAL REVENUES 30,100 43,536 13,436 EXPENDITURES Contractual Services 24,000 4,964 19,036 TOTAL EXPENDITURES 24,000 4,964 19,036 Excess (Deficiency) of Revenues Over (Under) Expenditures $ 6,100 38,572 $ 32,472 Fund Balance - October 1, 1999 119,534 Fund Balance - September 30, 2000 $ 158,106 51 DEBT SERVICE FUND This fund is used to account for the accumulation of resources for and the payment of principal, interest, and related costs on general long -term debt of the City. 52 This page intentionally left blank CITY OF SCHERTZ, TEXAS DEBT SERVICE FUND COMPARATIVE BALANCE SHEETS SEPTEMBER 30, 2000 AND 1999 ASSETS Cash and Cash Equivalents Delinquent Taxes Receivable (Net of Allowances) TOTAL ASSETS LIABILITIES AND FUND BALANCE Liabilities Accounts Payable Due to Other Funds Deferred Revenue Ad Valorem Taxes Total Liabilities Fund Balance Reserved for Debt Service TOTAL LIABILITIES AND FUND BALANCE 53 SEPTEMBER 30, 2000 1999 $ 184,999 $ 329,505 9,086 10,677 $ 194,085 $ 340,182 $ 225 $ - 79,755 159,061 9,086 10,677 89,066 169,738 105,019 170,444 $ 194,085 $ 340,182 CITY OF SCHERTZ, TEXAS DEBT SERVICE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES — BUDGET AND ACTUAL SEPTEMBER 30, 2000 (WITH COMPARATIVE ACTUAL AMOUNTS FOR 1999) Variance Favorable REVENUES Interest Income EXPENDITURES Debt Service Bond Principal Bond Interest Fiscal Agent Fees TOTAL EXPENDITURES Excess (Deficiency) of Revenues Over (Under) Expenditures OTHER FINANCING SOURCES (USES) Operating Transfers In Operating Transfers from Component Unit TOTAL OTHER FINANCING SOURCES (USES) Excess (Deficiency) of Revenues and Other Sources Over (Under) Expenditures and Other (Uses) Fund Balance - October 1 Fund Balance - September 30 1999 $ - $ 15,790 $ 15,790 $ 10,094 365,820 365,820 - 338,770 299,665 299,665 - 321,185 - 2,446 (2,446) 2,656 665,485 667,931 (2,446) 662,611 (665,485) (652,141) 13,344 (652,517) 191,805 198,612 6,807 258,785 388,105 388,104 (1) 392,189 $ (85,575) (65,425) $ 20,150 54 $ 105,019 (1,543) $ 170,444 CAPITAL PROJECTS FUND The Capital Projects Fund accounts for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary fund types.) 55 This page intentionally left blank CITY OF SCIIERT7, TEXAS CAPITAL PROJECTS FUND COMPARATIVE BALANCE SHEETS SEPTEMBER 30, 2000 AND 1999 601 TOTALS 2000 1999 ASSETS Cash and Cash Equivalents $ 1,104,573 $ 2,833,030 Due from Other Funds - 279,508 TOTAL ASSETS $ 1,104,573 $ 3,112,538 LIABILITIES AND FUND BALANCE Liabilities Accounts Payable $ 9,496 $ 1,035,262 Due to Other Funds 8,000 - Total Liabilities 17,496 1,035,262 Fund Balances Unreserved Designated 1,087,077 2,077,276 TOTAL LIABILITIES AND FUND BALANCE $ 1,104,573 $ 3,112,538 601 CITY OF SCHERTZ, TEXAS CAPITAL PROJECTS FUND COMPARATIVE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE YEAR ENDED SEPTEMBER 30, 2000 AND 1999 REVENUES Other Interest Income TOTAL REVENUES EXPENDITURES General and Administrative Professional and Contractual Services Capital Outlay TOTAL EXPENDITURES Excess (Deficiency) of Revenues Over (Under) Expenditures OTHER FINANCING SOURCES (USES) Operating Transfers In (Out) TOTAL OTHER FINANCING SOURCES (USES) Excess (Deficiency) of Revenues and Other Sources Over (Under) Expenditures and Other (Uses) Fund Balance - October 1 Prior Period Adjustment Fund Balance - October 1 As Adjusted Fund Balance - September 30 57 TOTALS 2000 1999 $ 76,885 $ 191,883 76,885 191,883 $ - $ 988 126,299 38,109 940,785 3,321,455 1,067,084 3,360,552 (990,199) (3,168,669) - 296,659 - 296,659 (990,199) (2,872,010) 2,077,276 4,779,428 - 169,858 2,077,276 4,949,286 $ 1,087,077 $ 2,077,276 PROPRIETARY FUND TYPE ENTERPRISE FUNDS Enterprise Funds are established to account for operations that are financed and operated in a manner similar to private business enterprises — where the intent of the governing body is that costs (expenses, including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges. The City operates the Water and Sewer System and the Schertz Area Facility for Emergency Services (SAFES) on this basis. WO This page intentionally left blank CITY OF SCIIERT7, TEXAS ENTERPRISE FUNDS COMBINING BALANCE SHEET SEPTEMBER 30, 2000 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1999) Other Assets: Organizational Costs (Net of Accumulated Amortization of $1,423 and $1,375 for 2000 and 1999) Bond Issuance Costs (Net of Accumulated Amortization of $18,755 and $15,004 for 2000 and 1999) Deferred Loss on Early Retirement of Debt (Net of Accumulated Amortization of $50,345 and $40,276 for 2000 and 1999) Total Other Assets TOTAL ASSETS 477 16,255 43,630 60,362 - 477 - 16,255 - 43,630 60,362 525 20,006 53,699 74,230 $ 11,186,676 $ 650,874 $ 11,837,550 $ 11,137,053 Continued WN WATER AND SEWER TOTALS SYSTEM SAFES 2000 1999 ASSETS Current Assets: Cash and Cash Equivalents $ 3,135,472 $ 152,339 $ 3,287,811 $ 2,110,309 Accounts Receivable (Net of Allowances of $7,613 and $41,726 respectively) 536,762 236,451 773,213 487,454 Accounts Receivable - Other 20,183 - 20,183 742,798 Due from Other Funds 163,780 - 163,780 607,839 Inventory of Supplies, at Cost 68,870 20,061 88,931 107,437 Prepaid Expenses 8,160 10,146 18,306 - Total Current Assets 3,933,227 418,997 4,352,224 4,055,837 Restricted Assets: Cash and Cash Equivalents 1,927,162 - 1,927,162 1,266,664 Fixed Assets: Land and Improvements 160,521 - 160,521 160,521 Buildings 195,724 26,656 222,380 222,380 Improvements Other than Buildings 10,964,007 7,642 10,971,649 10,800,124 Machinery, Equipment, and Vehicles 1,020,300 625,108 1,645,408 1,553,978 12,340,552 659,406 12,999,958 12,737,003 Less: Accumulated Depreciation (7,074,627) (427,529) (7,502,156) 6,996,681 Total Fixed Assets 5,265,925 231,877 5,497,802 5,740,322 Other Assets: Organizational Costs (Net of Accumulated Amortization of $1,423 and $1,375 for 2000 and 1999) Bond Issuance Costs (Net of Accumulated Amortization of $18,755 and $15,004 for 2000 and 1999) Deferred Loss on Early Retirement of Debt (Net of Accumulated Amortization of $50,345 and $40,276 for 2000 and 1999) Total Other Assets TOTAL ASSETS 477 16,255 43,630 60,362 - 477 - 16,255 - 43,630 60,362 525 20,006 53,699 74,230 $ 11,186,676 $ 650,874 $ 11,837,550 $ 11,137,053 Continued WN CITY OF SCHERTZ, TEXAS ENTERPRISE FUND COMBINING BALANCE SHEET (CONTINUED) SEPTEMBER 30, 2000 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1999) WATER AND .1' SEWER TOTALS SYSTEM SAFES 2000 1999 LIABILITIES AND EQUITY Current Liabilities: Vouchers Payable $ 464,806 $ 1,474 $ 466,280 $ 213,404 Note Payable - Current Maturity 32,106 - 32,106 29,821 Due to Other Funds - 8,256 8,256 281,483 Accrued Salaries and Benefits 11,300 12,580 23,880 18,335 Salary Reserve 21,859 27,370 49,229 18,335 Compensated Absences Payable 39,144 25,265 64,409 61,967 Total Current Liabilities 569,215 74,945 644,160 623,345 Current Liabilities Payable From Restricted Assets Customer Deposits 213,655 - 213,655 166,597 Revenue Bonds 35,000 - 35,000 35,000 Certificates of Obligation 10,000 - 10,000 10,000 Refunding Bonds 245,890 - 245,890 198,314 Public Facility Loan 5,000 - 5,000 5,000 Accrued Interest 11,540 - 11,540 14,764 Total Current Liabilities Payable From Restricted Assets 521,085 - 521,085 429,675 Noncurrent Liabilities: Revenue Bonds Payable (Less Current Maturities) 750,000 - 750,000 785,000 Certificate of Obligation Payable (Less Current Maturities) 120,000 - 120,000 130,000 Refunding Bonds (Less Current Maturities) 297,700 - 297,700 543,456 Public Facility Loan 57,000 - 57,000 62,000 Note Payable (Less Current Maturities) 34,564 - 34,564 66,671 Total Noncurrent Liabilities 1,259,264 - 1,259,264 1,587,127 TOTAL LIABILITIES 2,349,564 74,945 2,424,509 2,640,147 EQUITY Contributed Capital 3,688,756 226,769 3,915,525 4,053,631 Retained Earnings - Reserved: Revenue Bond Retirement 374,586 - 374,586 412,488 Equipment Replacement 40,000 - 40,000 40,000 Contingencies 750,000 222,500 972,500 - Unreserved 3,983,770 126,660 4,110,430 3,990,787 TOTAL EQUITY 8,837,112 575,929 9,413,041 8,496,906 TOTAL LIABILITIES AND EQUITY $ 11,186,676 $ 650,874 $ 11,837,550 $ 11,137,053 .1' CITY OF SCHERTZ, TEXAS ENTERPRISE FUND COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN RETAINED EARNINGS YEAR ENDED SEPTEMBER 30, 2000 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1999) NONOPERATING REVENUES (EXPENSES) Interest income 260,473 11,207 271,680 190,652 Interest Expenses (104,012) - (104,012) (120,483) TOTAL NONOPERATING REVENUE (EXPENSES) 156,461 11,207 167,668 70,169 NET INCOME (LOSS) BEFORE OPERATING TRANSFERS WATER AND (18,375) 897,444 602,785 Operating Transfers In (Out) SEWER - TOTALS (24,774) NET INCOME (LOSS) SYSTEM SAFES 2000 1999 OPERATING REVENUES Fees Charged to Users $ 3,663,091 $ 882,348 $ 4,545,439 $ 3,854,059 Reimbursements and Other 294,963 2,895 297,858 203,403 TOTAL OPERATING REVENUE 3,958,054 885,243 4,843,297 4,057,462 OPERATING EXPENSES - - - (169,858) Personnel Services 650,310 625,351 1,275,661 1,317,480 Sewage Treatment 820,724 - 820,724 550,647 General and Administrative 355,156 7,800 362,956 272,800 Contractual Services 731,960 101,486 833,446 493,123 Supplies /Maintenance 159,416 109,565 268,981 325,709 Bad Debts 208 32,204 32,412 45,462 TOTAL OPERATING EXPENSES BEFORE DEPRECIATION 2,717,774 876,406 3,594,180 3,005,221 Operating Income (Loss) Before Depreciation and Amortization 1,240,280 8,837 1,249,117 1,052,241 Depreciation and Amortization 480,922 38,419 519,341 519,625 OPERATING INCOME (LOSS) 759,358 (29,582) 729,776 532,616 NONOPERATING REVENUES (EXPENSES) Interest income 260,473 11,207 271,680 190,652 Interest Expenses (104,012) - (104,012) (120,483) TOTAL NONOPERATING REVENUE (EXPENSES) 156,461 11,207 167,668 70,169 NET INCOME (LOSS) BEFORE OPERATING TRANSFERS 915,819 (18,375) 897,444 602,785 Operating Transfers In (Out) 18,691 - 18,691 (24,774) NET INCOME (LOSS) 934,510 (18,375) 916,135 578,011 Add Back of Depreciation Closed to Contributed Capital 138,106 - 138,106 138,106 TOTAL 1,072,616 (18,375) 1,054,241 716,117 Retained Earnings - October 1 4,075,740 367,535 4,443,275 3,833,177 Prior Period Adjustment - - - (169,858) Retained Earnings - October 1 As Adjusted 4,075,740 367,535 4,443,275 3,663,319 TOTAL 5,148,356 349,160 5,497,516 4,379,436 TRANSFERS OF EQUITY - - - 63,839 Retained Earnings - September 30 $ 5,148,356 $ 3491160 $ 5,497,516 $ 4,443,275 61 CITY OF SCHERTZ, TEXAS ENTERPRISE FUNDS COMBINING STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES YEAR ENDED SEPTEMBER 30, 2000 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1999) CASH FLOWS FROM OPERATING ACTVITIES: Cash Received From Customers Cash Payments to Suppliers for Goods and Services Cash Payments to Employees for Services Cash Received From Reimbursements and Other NET CASH PROVIDED BY (USED Ili OPERATING ACTIVITIES CASH FLOWS FROM NONCAPITAL FINANCING ACTMTIES: Operating Transfers In (Out) to /from Other Funds CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES: Acquisition and Construction of Capital Assets Principal Payments on Long -Term Debt Interest Paid on Long -Term Debt Capital Advanced to Joint Venture Capital Contributed for Capital Assets NET CASH PROVIDED (USED) BY CAPITAL AND RELATED FINANCING ACTIVITIES CASH FLOWS FROM INVESTING ACTIVITIES: Interest on Investments WATER AND SEWER SYSTEM TOTALS SAFES 2000 1999 $ 3,554,960 $ 796,901 $ 4,351,861 $ 3,800,880 (1,735,809) (224,107) (1,959,916) (2,063,289) (635,362) (601,418) (1,236,780) (1,272,949) 294,963 2,895 297,858 203,403 1,478,752 (25,729) 1,453,023 668,045 18,691 - 18,691 (24,774) (201,486) (61,469) (262,955) (503,203) (278,002) - (278,002) (276,929) (107,236) - (107,236) (123,064) 742,798 - 742,798 (742,798) - - - 63,839 156,074 (61,469) 94,605 (1,582,155) 260,473 11,207 271,680 190,652 NET INCREASE (DECREASE) IN ACTIVITIES 1,913,990 (75,991) 1,837,999 (748,232) CASH AND EQUIVALENTS AT BEGINNING OF YEAR: 3,148,643 228,330 3,376,973 4,125,205 CASH AND EQUIVALENTS AT END OF YEAR: $ 5,062,633 $ 152,339 $ 5,214,972 $ 3,376,973 62 CITY OF SCHERTZ, TEXAS ENTERPRISE FUNDS COMBINING STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES (CONTINUED) YEAR ENDED SEPTEMBER 30, 2000 (WITH COMPARATIVE TOTALS FROM SEPTEMBER 30, 1999) Comprised of: Current Assets Restricted Assets WATER AND SEWER $ 3,135,471 1,927,162 TOTALS SAFES 2000 1999 $ 152,339 $ 3,287,810 $ 2,110,309 - 1,927,162 1,266,664 CASH AND CASH EQUIVALENTS END OF YEAR $ 5,062,633 $ 152,339 $ 5,214,972 $ 3,376,973 RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED BY OPERATING INCOME: Operating Income (Loss) $ 759,358 $ (29,582) $ 729,776 $ 532,616 Adjustments to Reconcile Operating Income to Net CashProvided (Used) by Operating Activities Depreciation/Amortization 342,816 38,419 381,235 381,519 Depreciation Attributed to Contributed Capital 138,106 - 138,106 138,106 Provision for Uncollectible Accounts 187 32,204 32,391 2,620 (Increase) Decrease in the Following Assets: Accounts Receivable (155,375) (182,956) (338,331) (10,335) Inventory 21,941 (3,435) 18,506 8,123 Prepaid Expenses (8,160) (10,146) (18,306) - Due from Other Funds 346,548 97,510 444,058 (444,903) Increase (Decrease) in the Following Liabilities: Vouchers Payable 252,808 68 252,876 (54,066) Due to Other Funds (281,483) 8,256 (273,227) 111,401 Accrued Vacation 953 1,489 2,442 7,861 Accrued Salaries and Benefits 1,718 3,827 5,545 18,335 Salary Reserve 12,277 18,617 30,894 18,335 Customer Deposits 47,058 - 47,058 (41,567) NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES $ 1,478,752 $ (25,729) $ 1,453,023 $ 668,045 63 This page intentionally left blank GENERAL FIXED ASSETS This account group is established to account for the fixed assets owned by the City exclusive of those relating to Proprietary Fund operations. Expenditure transactions to acquire general fixed assets occur in the General Fund. This page intentionally left blank CITY OF SCHERTZ, TEXAS COMPARATIVE SCHEDULE OF GENERAL FIXED ASSETS BY SOURCE YEARS ENDED SEPTEMBER 30, 2000 AND 1999 GENERAL FIXED ASSETS Land Buildings Improvements Other than Buildings Vehicles Equipment TOTALS INVESTMENT IN GENERAL FIXED ASSETS BY SOURCE General Fund Capital Projects General Obligation Bonds Certificates of Obligation Time Warrants Contractual Obligations Grant Contributed Special Revenue - Development Foundation Component Unit TOTALS 65 SEPTEMBER 30, 2000 $ 1,465,381 5,599,946 9,779,631 862,811 1,909,331 $ 19,617,100 1999 $ 997,173 4,216,586 8,555,316 1,394,066 1,639,022 $ 16,802,163 $ 3,506,087 $ 3,325,592 7,115,735 5,139,688 182,686 182,686 317,005 317,005 113,614 113,614 640,984 640,984 7,724,700 7,066,305 10,504 10,504 5,785 5,785 $ 19,617,100 $ 16,802,163 CITY OF SCHERTZ, TEXAS SCHEDULE OF GENERAL FIXED ASSETS — BY FUNCTION AND ACTIVITY YEAR ENDED SEPTEMBER 30, 2000 .. Balance Balance October 1, Adjustments/ September 30, 1999 Transfers Additions Deductions 2000 General Government $ 1,761,869 $ (123,880) $ 449,398 $ (17,631) $ 2,069,756 Public Safety Police 2,075,856 (178,713) 337,152 - 2,234,295 Fire 1,944,664 (321,309) 270,714 - 1,894,069 EMS 844,315 21,084 166,816 - 1,032,215 Inspection 27,210 2,290 - - 29,500 Streets and Park Streets 8,228,304 - 1,579,144 - 9,807,448 Pool 543,300 56,700 - - 600,000 Parks 712,900 139,583 219,239 - 1,071,722 Health Animal Control 271,915 (46,821) 1,527 - 226,621 Library 378,940 187,132 76,992 - 643,064 Economic Development Foundation 12,890 - - (4,480) 8,410 TOTALS $ 16,802,163 $ (263,934) $ 3,100,982 $ (22,111) $ 19,617,100 .. COMPONENTS TO GENERAL FIXED ASSETS Improvements Other Than Land Buildings Buildings Vehicles Equipment $ 314,258 $ 1,082,741 $ - $ 55,756 $ 617,001 41,793 1,611,753 - 244,513 336,236 41,793 1,281,141 - 215,981 355,154 41,793 969,338 - - 21,084 - - - 20,460 9,040 304,669 - 8,924,331 245,795 332,653 - - 600,000 - - 656,860 186,472 100,300 49,090 79,000 23,161 106,071 30,000 31,216 36,173 35,030 362,430 125,000 - 120,604 6,024 - - - 2,386 1,465,381 $ 5,599,946 $ 9,779,631 $ 862,811 $ 1,909,331 67 This page intentionally left blank DISCRETELY PRESENTED COMPONENT UNITS Discretely presented component units consist of separate entities whose governing bodies are not substantively the same as the governing body of the primary government. The discretely presented component units also provide services to areas other than the primary government. 68 This page intentionally left blank CITY OF SCHERTZ, TEXAS DISCRETELY PRESENTED COMPONENT UNITS COMBINING BALANCE SHEET SEPTEMBER 30, 2000 ASSETS Cash and Cash Equivalents Accounts Receivable Inventory TOTAL ASSETS LIABILITIES & FUND BALANCE Liabilities Accounts Payable Due to Primary Government Total Liabilities Fund Balances Reserved for Inventory Unreserved Designated Total Fund Balance TOTAL LIABILITIES & FUND BALANCE Schertz Economic Development Schertz The Development Totals Library Foundation 2000 $ 527,982 $ 35,362 $ 90,242 $ 653,586 59,656 - - 59,656 $ 587,638 $ 35,362 $ 96,266 $ 719,266 $ - $ 37 $ 40,089 10,606 547,549 24,719 547,549 24,719 - $ 37 50,732 6,024 6,024 96,266 668,534 $ 587,638 $ 35,362 $ 96,266 $ 719,266 m' CITY OF SCHERTZ, TEXAS DISCRETELY PRESENTED COMPONENT UNITS COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE SEPTEMBER 30, 2000 Schertz Economic Schertz Development The Development Totals Corporation Library Foundation 2000 REVENUES Taxes $ 679,161 $ - $ - $ 679,161 Other Net Land Sales - - 10,286 10,286 Donations - 5,451 - 5,451 Interest 17,366 1,018 4,806 231190 TOTAL REVENUES $ 696,527 $ 6,469 $ 15,092 $ 718,088 EXPENDITURES Current Culture and Recreation $ - $ 4,643 $ - $ 4,643 Economic Development 788 - 5,068 5,856 Total Expenditures 788 4,643 Excess (Deficiency) of Revenues Over Expenditures 695,739 1,826 OTHER FINANCING SOURCES (USES) Transfers to Primary Government (388,104) (10,606) Total Other Financing Sources (Uses) (388,104) Excess (Deficiency) of Revenues and Other Sources Over (Under) Expenditures and Other (Uses) 307,635 10,024 707,589 - (398,710) - (398,710) (8,780) 10,024 308,879 Fund Balances - October 1 239,914 33,499 77,496 350,909 Prior Period Adjustment - - 8,746 8,746 Fund Balances - September 30 $ 547,549 $ 24,719 $ 96,266 $ 668,534 70 ARMSTRONG, VAUGHAN & ASSOC., P.C. .................................................................... ............................... CERTIFIED PUBLIC ACCOUNTANTS REPORT ON COMPLIANCE AND INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT A UDITING STANDARDS The Honorable Mayor and Members of the City Council City of Schertz, Texas We have audited the financial statements of the City of Schertz, Texas, as of and for the year ended September 30, 2000, and have issued our report thereon dated December 20, 2000. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Compliance As part of obtaining reasonable assurance about whether the City of Schertz, Texas, general- purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grants, noncompliance with which could have a direct and material affect on the determination of the financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. Internal Compliance Over Financial Reporting In planning and performing our audit, we considered the City of Schertz, Texas, control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the general - purpose financial statements and not to provide assurance on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control over financial reporting that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses. However, we noted other matters involving the internal control over financial reporting that we have reported to management of the City of Schertz in a separate letter dated December 20, 2000. 71 433 KITTY HAWK, SUITE 113 • UNIVERSAL CITY, TEXAS 78148 • (210) 658 -6229 • FAX (210) 659 -7611 • www.avacps.com This report is intended for the information and use of management, others within the organization, and City Council and is not intended to be and should not be used by anyone other than these specified parties. Arwi4tYQVt*, Vaugha+V fr Asti, P.C. Armstrong, Vaughan & Assoc., P.C. December 20, 2000 72 STATISTICAL SECTION 73 CITY OF SCHERTZ, TEXAS GENERAL GOVERNMENTAL EXPENDITURES BY FUNCTION LAST TEN FISCAL YEARS TABLE 1 Fiscal General Public Streets Total Period Government Safety And Parks Health Other Expenditures* 1991 $ 659,815 $ 836,031 $ 342,974 $ 65,816 $ 436,419 $ 2,341,055 1992 689,082 843,582 352,093 66,646 393,138 2,344,541 1993 741,305 924,222 373,213 75,441 479,836 2,594,017 1994 744,801 978,121 308,126 80,494 645,063 2,756,605 1995 813,789 1,059,331 349,659 80,324 633,582 2,936,685 1996 886,090 1,174,371 304,722 85,685 1,510,303 3,961,171 1997 976,032 1,472,534 397,807 102,293 798,071 3,746,737 1998 1,063,835 1,702,684 408,461 127,065 1,165,475 4,467,520 1999 1,306,500 2,023,379 806,029 142,287 2,142,364 6,420,559 2000 1,479,496 2,172,619 793,700 155,814 1,898,888 6,500,517 * Includes General, Special Revenue, and Debt Service Funds. 74 CITY OF SCHERTZ, TEXAS GENERAL GOVERNMENTAL REVENUES BY SOURCE LAST TEN FISCAL YEARS TABLE 2 *Includes General, Special Revenue, and Debt Service Funds. (1) 1999 Revenues have been revised to reflect the prior period adjustment detailed in Note L. 75 Charges Fiscal Licenses and for Fines and Period Taxes Permits Services Forfeits Other Total 1991 $ 1,746,053 $ 43,826 $ 276,508 $ 201,512 $ 156,737 $ 2,424,636 1992 1,811,941 53,316 326,184 221,856 113,261 2,526,558 1993 1,895,333 173,310 327,434 196,200 112,248 2,704,525 1994 2,109,202 145,229 343,731 195,964 195,320 2,989,446 1995 2,285,735 134,391 353,050 209,719 340,232 3,323,127 1996 2,389,765 394,841 375,767 317,403 244,638 3,722,414 1997 2,698,175 546,159 452,890 331,244 242,905 4,271,373 1998 3,168,926 610,943 472,366 343,943 654,095 5,250,273 1999 3,768,037 680,316 558,904 379,584 1,100,315 6,487,156 (�) 2000 4,088,491 731,488 626,464 444,331 625,841 6,516,615 *Includes General, Special Revenue, and Debt Service Funds. (1) 1999 Revenues have been revised to reflect the prior period adjustment detailed in Note L. 75 CITY OF SCHERTZ, TEXAS PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS TABLE 3 76 Percent of Total Fiscal Total Current Tax Current Levy Delinquent Tax Year Tax Levy Collections Collected Collections Collections September 30, 1991 $ 1,005,598 $ 975,352 97.0% $ 37,972 $ 1,013,324 September 30, 1992 1,042,914 1,014,564 97.0% 19,995 1,034,559 September 30, 1993 1,102,209 1,083,800 98.3% 17,037 1,100,837 September 30, 1994 1,212,063 1,192,569 98.4% 14,634 1,207,203 September 30, 1995 1,337,010 1,290,283 96.5% 13,280 1,303,563 September 30, 1996 1,360,548 1,342,990 98.7% 13,194 1,356,184 September 30, 1997 1,408,699 1,384,497 98.3% 18,639 1,403,136 September 30, 1998 1,600,008 1,565,295 97.8% 18,922 1,584,217 September 30, 1999 1,892,640 1,869,557 98.8% 42,720 1,912,277 September 30, 2000 2,198,381 2,153,542 98.0% 43,622 2,197,164 76 Ratio of Total Ratio of Tax Collections Outstanding Delinquent to Total Delinquent Taxes to Total Tax Levy Taxes Tax Levy 101.0% $ 78,396 7.8% 99.0% 84,843 8.1% 99.9% 85,876 7.8% 99.6% 71,161 5.9% 97.5% 81,404 6.1% 99.7% 89,860 6.6% 99.6% 97,394 6.9% 99.0% 111,856 7.0% 102.3% 106,230 5.6% 99.9% 95,438 4.3% 77 Levy Year 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 CITY OF SCHERTZ, TEXAS ASSESSED AND TAXABLE VALUE OF PROPERTY LAST TEN FISCAL YEARS Fiscal Year Ended 09 -30 -91 09 -30 -92 09 -30 -93 09 -30 -94 09 -30 -95 09 -30 -96 09 -30 -97 09 -30 -98 09 -30 -99 09 -30 -00 Estimated Actual Values $340,903,727 269,351,284 256,861,608 264,286,116 362,247,758 346,130,091 369,917,233 452,163,752 545,742,286 636,157,284 Assessment Assessed Percentage Valuations W. 100% $272,593,690 100% 268,170,123 100% 259,038,486 100% 258,766,426 100% 312,676,505 100% 334,122,763 100% 378,784,051 100% 450,199,212 100% 534,039,183 100% 636,157,284 TABLE 4 Tax Tax Rate Levy .3689% $ 1,005,598 .3889% 1,042,914 .4255% 1,102,209 .4684% 1,212,063 .4275% 1,337,010 .4072% 1,360,548 .3719% 1,408,699 .3554% 1,600,008 .3544% 1,892,640 .3456% 2,198,381 CITY OF SCHERTZ, TEXAS PROPERTY TAX RATES - ALL OVERLAPPING GOVERNMENTS LAST TEN FISCAL YEARS TABLE 5 ra City School County County Road 100% 100% 100% 100% Assessment Assessment Assessment Assessment Year ** Rate* Rate* Rate Rate 1991 .3689 1.0056 .1418 .0977 1992 .3889 1.2051 .2720 .0850 1993 .4255 1.4777 .3599 .0850 1994 .4684 1.4499 .3036 .0950 1995 .4275 1.3095 .2995 .0867 1996 .4072 1.3712 .3018 .0833 1997 .3719 1.4089 .2997 .0758 1998 .3554 1.4299 .3040 .0730 1999 .3544 1.6923 .3192 .0600 2000 .3455 1.4945 .3417 .0582 *All rates shown are per $100 assessed valuation. * *Year shown is the fiscal year of collection. Taxes were levied the previous calendar year. ra CITY OF SCHERTZ, TEXAS RATIO OF NET GENERAL BONDED DEBT TO TAXABLE VALUE AND NET GENERAL BONDED DEBT PER CAPITA LAST TEN FISCAL YEARS TABLE 6 *Based on Preliminary 1990 Census. The estimate has been challenged by the City. :1 Ratio Net Net General of Net General Fiscal Bonded Bonded Debt Bonded Debt Year Estimated Assessed Debt To Assessed Per Capita September 30, 1991 10,900* $272,593,690 $ 715,300 .26 65.62 September 30, 1992 11,500 268,170,123 687,715 .26 59.80 September 30, 1993 12,000 259,038,486 1,190,645 .46 99.22 September 30, 1994 12,500 258,766,426 1,132,129 .43 90.57 September 30, 1995 13,500 312,676,405 1,056,611 .34 78.27 September 30, 1996 14,500 334,122,763 1,215,000 .36 83.79 September 30, 1997 15,000 378,784,051 1,095,000 .29 73.00 September 30, 1998 17,500 450,199,212 5,901,000 1.31 337.20 September 30, 1999 18,000 534,039,183 5,622,230 1.05 312.35 September 30, 2000 18,500 636,157,284 5,321,410 .84 287.64 *Based on Preliminary 1990 Census. The estimate has been challenged by the City. :1 CITY OF SCIIERTZ, TEXAS COMPUTATION OF DIRECT AND OVERLAPPING DEBT YEAR ENDED SEPTEMBER 30, 2000 TABLE 7 Direct And Net Estimated Estimated Bonded Percent Overlapping Debt Applicable Bonded Debt *Bexar County $ 139,472,802 *Comal County 7,328,399 *Comal Independent School District 137,775,401 *Guadalupe County 15,525,000 *Schertz- Cibolo- Universal City 21,284,015 Independent School District *San Antonio, RA *Alamo Community College District Total Net Overlapping Debt *City of Schertz TOTAL DIRECT AND OVERLAPPING DEBT (3.22% OF ASSESSED VALUE - $1,107.33 PER CAPITA) *Source of Data - Texas Municipal Reports, City of Schertz, April, 2000 Compiled and Published by Municipal Advisory Council of Texas 57,865,000 46,470,795 81 6,930,000 0.02% $ 27,895 0.09 8,596 0.12 166,330 14.75 2,289,938 51.88 11,042,147 0.02 11,573 0.02 9,204 13,555,683 100.00% 6,930,000 $ 20,485,683 CITY OF SCHERTZ, TEXAS LEGAL DEBT MARGIN YEAR ENDED SEPTEMBER 30, 2000 TABLE 8 Texas municipalities are not bound by and direct constitutional or statutory maximums as to the amount of general obligation bonds which may be issued; however, all local bonds must be submitted to and approved by the State Attorney General. It is the established practice of the Attorney General not to approve a prospective bond issue if it will result in the levy of a tax for bonded debt of over $1.00 for cities under 5,000 population or $1.50 for cities over 5,000 population. 82 CITY OF SCHERTZ, TEXAS RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR GENERAL OBLIGATION BONDED DEBT TO TOTAL GENERAL FUND EXPENDITURES LAST TEN FISCAL YEARS Fiscal Year September 30, 1991 $ September 30, 1992 September 30, 1993 September 30, 1994 September 30, 1995 September 30, 1996 September 30, 1997 September 30, 1998 September 30, 1999 September 30, 2000 Debt Service TABLE 9 Ratio of Debt Service to General Expenditures 45,000 $ 49,067 $ 94,067 $ 2,341,055 4.0% 46,000 46,084 92,084 2,344,541 4.0% 57,000 42,830 99,830 2,594,017 3.9% 58,000 97,493 155,493 2,756,605 5.6% 85,000 74,139 159,139 2,936,945 5.4% 341,000 87,098 428,098 3,961,171 10.8% 120,000 65,540 185,540 3,746,737 5.0% 124,000 58,916 182,916 4,467,520 4.1% 278,770 303,468 582,238 6,420,559 11.0% 300,820 286,435 587,225 6,500,517 9.0% * Includes General, Special Revenue, and Debt Service Funds CITY OF SCHERTZ, TEXAS REVENUE BOND COVERAGE — UTILITY SYSTEM BONDS LAST TEN FISCAL YEARS TABLE 10 ., Total Operating Operating Expenses Income Fiscal Operating Before Before Year Revenues Depreciation Depreciation September 30, 1991 $ 1,515,854 $ 1,139,935 $ 375,919 September 30, 1992 1,487,049 1,203,574 283,475 September 30, 1993 1,617,768 1,387,165 230,603 September 30, 1994 1,997,654 1,206,670 790,984 September 30, 1995 1,967,127 1,292,499 674,628 September 30, 1996 2,390,600 1,325,796 1,064,804 September 30, 1997 2,879,730 1,556,271 1,323,459 September 30, 1998 3,316,900 1,711,388 1,605,512 September 30, 1999 3,250,589 2,145,249 1,105,340 September 30, 2000 3,958,054 2,717,774 1,240,280 ., 85 Number of Debt Service Requirements Customers Principal Interest Total Coverage Water Sewer $ 83,000 $ 139,423 $ 222,423 1.69:1 3,751 3,086 80,000 134,473 214,473 1.32:1 3,859 3,177 90,000 128,672 218,672 1.06:1 4,074 3,377 95,000 122,106 217,106 3.64:1 4,231 3,488 100,000 115,028 215,028 3.13:1 4,282 3,584 445,000 92,080 537,080 1.98:1 4,877 4,031 55,000 70,578 125,578 10.54:1 5,641 4,622 55,000 67,013 122,013 13.16:1 6,914 5,767 80,000 63,588 143,588 7.70:1 7,351 6,226 35,000 58,375 93,375 13.28:1 6,837 5,814 85 CITY OF SCHERTZ, TEXAS WATERWORKS AND SEWER SYSTEM FUNDS REVENUE BOND REQUIREMENTS AND RESTRICTED FUNDS YEAR ENDED SEPTEMBER 30, 2000 UTILITY SYSTEM REVENUE BONDS, SERIES 1987 Principal Payment, Due September 1, 2001 Interest Payment, Due March 1, 2001 Total Requirements Cash - Restricted Over (Under) Requirements RESERVE FUND REQUIREMENTS TABLE 11 Annual Requirement Principal/ At Semi - Annual September 30, Interest Basis 2000 35,000 1/12 th $ 2,917 27,876 1/6 th 4,646 7,563 12,389 $ 4,826 The City is required to make monthly deposits sufficient to meet the total reserve fund requirement within sixty (60) months of the closing date for the 1987 issue. City monthly deposits through September 30, 2000 met these requirements. 1 1/2 Time Average Annual Principal and Interest Requirement (Annual $145,964) $ 218,946 Cash and Cash Equivalents Funds Available Over (Under) Requirement :. $ 205,901 CITY OF SCHERTZ, TEXAS DEMOGRAPHIC STATISTICS LAST TEN FISCAL YEARS 87 Level In Per Years Of Capita Median Formal School Unemployment Fiscal Population Income Age Education Enrollment Rate in % Year (1) (2) (3) (3) (4) (3) 1991 10,900 Est. $ 13,436 35 14 4,309 6.3% 1992 12,000 Est. 13,500 33 14 4,619 4.0 1993 12,000 Est. 13,500 32 14 4,700 3.9 1994 12,500 Est. 13,600 32 14 4,576 3.9 1995 13,500 Est. 13,600 32 14 4,678 3.9 1996 14,500 Est. 13,600 32 14 4,841 3.9 1997 15,000 Est. 13,600 33 14 5,136 3.9 1998 17,500 Est. 16,500 32.6 14.6 5,951 3.9 1999 18,000 Est. 16,500 32.6 14.6 5,777 3.9 2000 18,500 Est. 39,757 32.6 14.6 6,407 3.3 Source: (1) 1990 Bureau of the Census Department of Planning, University of Texas (2) Department of Economics, University of Texas United States Department of Labor (Information not Available for Odd Years) (3) Texas Employment Commission 87 CITY OF SCHERTZ, TEXAS PROPERTY VALUE AND NEW CONSTRUCTION LAST TEN FISCAL YEARS Commercial Construction Number Value TABLE 13 Residential Construction Number Value 1991 11 $ 938,564 33 $ 2,377,438 1992 11 664,016 50 4,140,140 1993 9 235,825 245 22,537,308 1994 21 4,868,688 92 8,323,846 1995 31 4,271,904 126 12,815,060 1996 25 14,758,928 468 48,959,088 1997 32 10,587,644 524 57,591,942 1998 22 17,173,013 537 60,529,538 1999 27 14,396,374 520 58,783,734 2000 21 13,169,373 353 43,092,362 Sources: City Building Inspection Records City Tax Records S. W. T. Research Center Schertz State Bank Surety Southwest State Bank & Trust Property Value* Commercial Residential Nontaxable $ 32,198,188 $ 177,354,060 $ 430,425 30,327,586 178,353,991 5,086,170 31,626,493 182,817,263 5,360,890 33,775,788 216,454,372 5,374,948 54,009,275 246,501,668 5,607,897 40,363,499 246,223,426 8,557,521 52,420,249 333,173,109 10,448,019 71,693,462 395,802,747 10,898,210 258,298,378 354,485,210 22,672,637 324,331,981 403,920,536 31,850,206 * Estimated Actual Value :• CITY OF SCHERTZ, TEXAS PRINCIPAL TAXPAYERS YEAR ENDED SEPTEMBER 30, 2000 TABLE 14 TOTAL ASSESSMENTS .1 $ 636,157,284 100.00% 1999 Percentage Of Assessed Total Assessed Principal Taxpayers Type of Business Valuation Valuation 1. H E Butt Grocery Co Grocery Sales $ 9,517,558 1.50% 2. Erich W. White Real Estate 5,769,582 .91 3. Sycamore Apartments LTD Apartment Complex 5,005,680 .79 4. Coronado Paint, Inc. Industrial 4,570,575 .72 5. Garden Ridge Pottery Mercantile 4,496,778 .71 6. PSPI, Inc. Machine Fabricating 4,347,106 .68 7. CHM Parks Inc. Real Estate 3,118,602 .49 8. ARC SPEII, LLC Real Estate 3,095,949 .49 9. Guadalupe Valley Electric Utility 3,052,440 .48 10. American Standard Industrial 2,427,121 .38 Other Assessed Properties 590,755,893 92.85 TOTAL ASSESSMENTS .1 $ 636,157,284 100.00% CITY OF SCHERTZ, TEXAS MISCELLANEOUS STATISTICS YEAR ENDED SEPTEMBER 30, 2000 TABLE 15 Date of Incorporation: December, 1958 Date of First Charter Adopted: April, 1974 Date Present Charted Adopted: Amended May, 1997 Form of Government: Council - Manager Year Square Miles 2000 24.18 1999 24.15 1998 24.15 1997 24.15 1996 24.15 1995 24.15 1994 24.15 1993 24.15 1992 24.15 1991 23.75 Miles of highways, Streets, and Alleys Streets and Highways, Paved 97.49 Miles Streets, Unpaved 6.78 Miles Alleys 3.44 Miles Sidewalks 16.95 Miles Miles of Sewer: Storm 3.02 Miles Sanitary 48.05 Miles Building Permits: Value Of Year Permits Issued Buildings 2000 3,716 $61,864,013 1999 3,690 76,501,638 1998 3,767 82,800,348 1997 3,373 71 ,741,172 1996 2,559 64,267,503 1995 2,066 21,150,682 1994 2,771 18,917,416 1993 2,167 27,705,848 1992 873 6,702,848 1991 545 7,667,699 Continued H CITY OF SCHERTZ, TEXAS MISCELLANEOUS STATISTICS (CONTINUED) SEPTEMBER 30, 2000 TABLE 15 Fire Protection: Number of Stations I Number of Employees (Full and Part -Time) 21 Number of Volunteers 10 Recreation: 17,500 Parks 7 Playgrounds 65 Other Recreational Facilities: 7,260 Baseball Fields 3 Softball Fields 2 Large Pavillion 10,000 Square Feet Covered Small Pavillion 600 Square Feet Covered Picnic Tables: Uncovered 50 Restrooms: Mate 6 Female 6 Concessions Stands I Community Center I City Employees: September 30, 1999 154 Elections: Number of Registered Voters 11,692 Number of Votes in: Last Municipal Election 767 Percentage of Registered Voters Voting in: Last Municipal Election 7% Source: Municipal Election Records Population: Census Population Count 2000 (Estimate) 18,500 1999 (Estimate) 18,000 1998 (Estimate) 17,500 1997 (Estimate) 15,000 1990 10,597 1980 7,260 1970 4,061 1 960 2,281 1950 1,200 1940 600 92