CAFR FY 1995-96COMPREHENSIVE
ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED
SEPTEMBER 30, 1996
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CITY OF SCHERTZ, TEXAS
MAYOR
CITY COUNCIL
CITY OF SCHERTZ, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED SEPTEMBER 30, 1996
CITY OFFICIALS
HONORABLE HAROLD D. BALDWIN
KENNETH GREENWALD
MAYOR PRO -TEM
(November 21, 1995 to May 21, 1996)
TIMOTHY SWINNEY
MAYOR PRO -TEM
(May, 1995 to November 21, 1995)
EARL SAWYER
JOE POTEMPA
CHARLES MCDONALD
MAYOR PRO -TEM
(May 21, 1996 to November 5, 1996)
CITY MANAGER KERRY R. SWEATT
INDEPENDENT AUDITORS
Thompson, Williams, Biediger, Kastor & Young, L.C.
San Antonio, Texas
OFFICIALS ISSUING REPORT
Kerry R. Sweatt
City Manager
i
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ii
C O N T E N T S
PAGE
NUMBER
INTRODUCTORY SECTION
Letter of Transmittal
ix
Organization Chart
xvii
GFOA Certificate of Achievement
xviii
FINANCIAL SECTION
Independent Auditor's Report
3
General Purpose Financial Statements
Combined Balance Sheet - All Fund Types
and Account Groups and Discretely Presented
Component Unit
8
Combined Statement of Revenues, Expenditures,
and Changes in Fund Balances - All Governmental
Fund Types
11
Combined Statement of Revenues, Expenditures,
and Changes in Fund Balances - Budget and
Actual - General and Debt Service Fund Type
13
Combined Statement of Revenues, Expenses, and
Changes in Retained Earnings - All Proprietary
Fund Types
15
Combined Statement of Cash Flows - All Proprietary
Fund Types
16
Notes to Financial Statements
18
Combining, Individual Fund and Account Group
Statements and Schedules
General Fund
Comparative Balance Sheets
43
Comparative Schedules of Revenues,
Expenditures, and Changes in Fund Balances
(GAAP Basis) - Budget and Actual
44
Schedule of Revenues Compared to Budget
45
Schedule of Expenditures Compared to Budget
(GAAP Basis)
46
iii
C O N T E N T S
PAGE
TABLE
NUMBER
Special Revenue Funds
Combining Balance Sheet
48
Combining Statement of Revenue, Expenditures
and Changes in Fund Balances
49
Debt Service Fund
Comparative Balance Sheets
52
Comparative Statements of Revenues,
Expenditures, and Changes in Fund
Balances - Budget and Actual
53
Capital Projects Funds
Comparative Balance Sheets
57
Comparative Statements of Revenue,
Expenditures, and Changes in Fund Balances
58
Enterprise Funds
Combining Balance Sheet
60
Combining Statement of Revenues, Expenses,
and Changes in Retained Earnings
62
Combining Statement of Cash Flows
All Proprietary Fund Types
63
General Fixed Assets
Schedules of General Fixed Assets - By Source
67
Schedules of General Fixed Assets -
By Function and Activity
68
STATISTICAL INFORMATION
General Governmental Expenditures by Function
1
72
General Government Revenues by Source
2
73
Property Tax Levies and Collections
3
75
Assessed and Estimated Actual Value of Property
4
77
iv
C O N T E N T S
PAGE
TABLE NUMBER
Property Tax Rates - Direct and Overlapping
Governments
5
78
Ratio of Net General Obligation Bonded Debt
to Assessed Value and Net General Bonded
Debt Per Capita
6
79
Computation of Direct and Overlapping Debt
7
80
Legal Debt Margin
8
81
Ratio of Annual Debt Service Expenditures for
General Obligation Bonded Debt to Total
General Expenditures - Last Ten Fiscal Years
9
83
Water and Sewer Fund Revenue Bond Coverage
10
84
Waterworks and Sewer System Fund Revenue
Bond Requirements and Restricted Funds
11
85
Demographic Statistics - Last Ten Fiscal Years
12
87
Property Value, Construction, and Bank
Deposits - Last Ten Fiscal Years
13
89
Principal Taxpayers
14
90
Miscellaneous Statistics
15
92
SINGLE AUDIT REPORTS
Independent Auditor "s Report on Schedule
of Federal Financial Assistance
95
Schedule of Federal Financial Assistance
97
Notes to Schedule of Federal Financial
Assistance
98
Independent Auditorfs Report on Internal
Control Structure Based on an Audit of
General Purpose Financial Statements
Performed in Accordance with Government
Auditing Standards
99
Independent Auditorfs Report on Compliance
Based on an Audit of General Purpose
Financial Statements Performed in
Accordance with Government Auditing
Standards
103
v
C O N 11 N T S
PAGE
TABLE NUMBER
Independent Auditor "s Report on Internal
Control Structure Used in Administering
Federal Financial Assistance Programs 105
Independent Auditor's Report on Compliance
with the General Requirements Applicable to
Federal Financial Assistance Programs 109
Independent Auditor "s Report on Compliance
with Specific Requirements Applicable to
Nonmajor Federal Financial Assistance
Program Transactions
vi
111
INTRODUCTORY SECTION
vii
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viii
1400 SCHERTZ PARKWAY
P. O. DRAWER I
SCHERTZ, TEXAS 78154 -0890
AC (210) 658 -3510 KERRY R. SWEATT
FAX (210) 659 -3204 CITY MANAGER
April 19, 1997
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, 1996 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 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, Table of
Organization, comments regarding economic conditions and outlook, major
occurrences of fiscal year 1995 -96, and major initiatives for fiscal year
1996 -97.
2. Financial - This section consists of: The Independent Auditors' Report,
General Purpose Financial Statements including combined balance sheets
and combined statements of revenue and 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.
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
ix
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City resources. 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 which continues to rank as one of the highest tourist attraction
areas in the Southwest. The economic condition and outlook of the area continues
to improve and statistical data for fiscal year 1995 -96 economic indicators
include: Housing starts were 460 for 1995 -96 as compared to 126 for the previous
year. Total permits were valued at $48,959,088 for 1995 -96 compared to $21,150,682
for last year.
The current economic condition in the area and region remains positive. Area
unemployment continues to fall as area businesses expand and new businesses open.
Another sign of good economic fortune is the continual expansion of our tax base.
While some increases are from increased valuation, the majority was due to growth
in both the residential and commercial sectors. The continued growth in sales tax
revenues is a further indication of local economic strength.
The economic outlook for Schertz and the surrounding area remains favorable.
Commercial inquiries continue at a heavy pace, and the size and scope of the
projects reflect a growing maturity and sophistication in our service area. The
size of the projects "on the ground" show the willingness to invest in Schertz is
very strong. We believe this trend is likely to continue for at least the next two
years, provided the national economy remains stable.
CURRENT YEAR PROJECTS
Recent new developments as well as enhancement of existing businesses shows
a renewed enthusiasm, and the attitude that "nothing breeds success like success"
seems to effect relocation and growth activity for our area. A positive outlook
is shared by all involved in the community "s Economic Development Commission
activities. The City is currently working with several substantial prospects to
relocate to the area. Four new industrial relocations were announced that total
over 8 million dollars in hard capital investment. American Freightways completed
its new 72 bay truck terminal at a capital cost of 3.5 million dollars.
MAJOR EVENTS
The major events for fiscal year 1995 -96 can be categorized into two words,
growth and growth in housing construction and master planning, the City continues
to grow to a point at which new platted residential lots are continuing to be
platted and built at an increasing rate. By the end of the fiscal year over 515
additional residential lots had been platted. Dove Meadows Unit III, Greenshire
Unit III, Woodland Oaks 5A, 6A, 10 and Ashley Place Unit II were completed.
Greenshire Units IV, VI, Ashley Place Unit III, Dove Meadows Unit IV, Berry Creek
Unit I and Carolina Crossing Unit I began construction.
The announcement by Security Capital Investment Trust of plans to construct
a 244,000 square foot distribution center in Tri- County Business Park. The
estimated 6 million dollar cost represents the largest single capital investment
in the history of Schertz. HEB started the final platting process for an 81,000
square foot retail store.
xi
MAJOR INITIATIVES
During the coming year we believe the City will continue to benefit from the
generally positive outlook. Renewed interest and emphasis in upgrading
infrastructure and meeting the challenges of growth in service request will occupy
a major portion of time. It is anticipated that a major capital improvements
program addressing community needs in public safety, parks and recreation,
community facilities and other areas will be discussed. We also expect further
consideration will be given to the question of an additional sales tax levy for
specific purposes. Overall the future for residential, commercial, and industrial
growth appears to be quite high.
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.
General Governmental Functions: Revenues which include General, Special
Revenue, Debt Service, and Capital Projects for general governmental function
totaled $3,785,857 in 1996, an increase of 8.38% from 1995. Taxes produced 62.99%
of general revenues compared to 65.90% last year. The amount of revenues from
various sources and the increase /decrease from last year are shown in the following
tabulation:
xii
PERCENT INCREASE
OF (DECREASE)
AMOUNT TOTAL FROM 1995
Taxes (Property, Sales, Etc.)
$2,384,706
62.99%
$ 98,971
Licenses and Permits
394,841
10.43
260,450
Charges for Services
375,767
9.93
22,717
Fines and Forfeitures
317,403
8.38
107,684
Other Revenues
313,140
8.27
(172,711)
$3,7,857 10% $317,111
Expenditures. For general governmental purposes, expenditures totaled
$4,018,958, an increase of 8.26`k from 1995. Changes in levels of expenditures for
major functions of the City over the preceding year are shown in the following
tabulation:
$4,018,958 100-00% $332
As reflected in the financial statements, general fund revenues including sales
tax as well as ad valorem taxes have generally increased. Through cooperative
agreements with Guadalupe County, specific intergovernmental 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. General Fund expenditures have increased in a number of areas
including overall personnel costs resulting from step increases and related items.
We believe overall realignments in budget accounts more correctly reflect actual
cost centers by activity and function than in years prior.
General obligation bonded debt data for the City of Schertz at the end of 1996
fiscal year was as follows:
Net General Obligation Bonded
Debt (Principal)
AMOUNT
$1,215,000
xiii
RATIO OF DEBT
TO ASSESSED
VALUE (100%)
OF PRESENT
MARKET
.36
DEBT
PER CAPITA
$83.00
PERCENT
INCREASE
OF
(DECREASE)
FUNCTION
AMOUNT
TOTAL
FROM 1995
General Government
$ 898,599
22.36%
$ 84,810
Public Safety
1,174,371
29.22
115,040
Streets and Parks
304,722
7.58
(44,937)
Health Services
85,685
2.13
5,361
Recreation
156,101
3.88
(19,961)
Economic Development
67,946
1.69
1,770
Capital Outlay
486,942
12.12
(358,237)
Debt Service
844,592
21.02
548,247
$4,018,958 100-00% $332
As reflected in the financial statements, general fund revenues including sales
tax as well as ad valorem taxes have generally increased. Through cooperative
agreements with Guadalupe County, specific intergovernmental 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. General Fund expenditures have increased in a number of areas
including overall personnel costs resulting from step increases and related items.
We believe overall realignments in budget accounts more correctly reflect actual
cost centers by activity and function than in years prior.
General obligation bonded debt data for the City of Schertz at the end of 1996
fiscal year was as follows:
Net General Obligation Bonded
Debt (Principal)
AMOUNT
$1,215,000
xiii
RATIO OF DEBT
TO ASSESSED
VALUE (100%)
OF PRESENT
MARKET
.36
DEBT
PER CAPITA
$83.00
General Obligation Bonds
Revenue Bonds
MOODYFS
INVESTORS
SERVICE
Baa -1
A
In October 1995, the City issued $1,700,000 of General Obligation Refunding
Bonds. This refunding bond issue replaced a total of seven bond issues from the
water and sewer fund and general long -term debt account group. The issuance of
these bonds was given an A rating.
Property Taxes. Current tax collections are 98.7% of the tax levy. This is
the sixth consecutive year in which current property tax collections have exceeded
95.0 %. The ratio of total collections (current and delinquent) to the current tax
levy was 99.7%. Allocations of property tax levy by purpose for 1996 and the
preceding two fiscal years are as follows (amounts per $100 assessed value):
PURPOSE
General Fund
General Obligation Debt
1996 1995 1994
.3472 .3478 .3731
.0600 .0797 .0953
.4072 .4�275 .4684
Cash Management. Cash temporarily idle during the year was invested in short-
term time deposits and U. S. Treasury bills. The interest earned on such deposits
during the year was $185,651, an increase of $25,552 interest compared to earnings
during 1995. This increase was due to additional funds from the General Fund and
Water and Sewer Fund being available. 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, 1996, the general fixed
assets of the City amounted to $11,721,266. This amount represents the original
cost, or an estimate of. the original cost of the assets. Depreciation of general
fixed assets is not recognized in the City's accounting system. Refer to
Notes 1 (I) and 5 in the notes to the financial statements.
The City is self- insured on physical damage to specific vehicles. In order to
provide coverage for this, risk funds are designated in the General Fund with a
balance of $45,000 at September 30, 1996.
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
xiv
1996 1995
$2,390,600 $1,997,654
667,185 289,089
998,010 608,414
289,392 292,654
During the year, $445,000 of maturing revenue bonds and $4,000 in Public
Facility HUD Bond, and $22,198 of a note payable (New Braunfels Utilities) were
retired in the Water and Sewer Fund.
Schertz Area Facility for Emergency Services (SAFES) - During the fiscal year
ended September 30, 1996, SAFES increased its revenue 6.3% and increased operating
expenses by 15.9%. SAFES is fully dependent on income fees generated from services
rendered and the contracted cities' support to cover operations costs. This year
SAFES had an operating income before depreciation of $78,659. A net charge for
future uncollectible accounts of $19,747 reduced operating expenses for the current
year.
OTHER INFORMATION
Awards. The Government Finance Officers Association of the United States and
Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial
Reporting to the City for its comprehensive annual financial report for the fiscal
year ended September 30, 1995. The Certificate of Achievement is the highest form
of- recognition for excellence in state and local government financing reporting.
In order to be awarded a Certificate of Achievement, a government unit must
publish an easily readable and efficiently organized comprehensive annual financial
report, whose contents conform to program standards. Such reports must satisfy both
generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. The City
of Schertz has received a Certificate of Achievement for the last six (6)
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 of Thompson, Williams, Biediger, Kastor
& Young, L.C. of San Antonio, Texas, to perform the independent audit for the fiscal
year 1995 -96. 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. Representatives of the
audit firm of Thompson, Williams, Biediger, Kastor & Young, L.C. and specifically,
Fred Timmons, have provided a high degree of expertise and assistance for the
preparation of the report and I wish to express my personal thanks and appreciation
for their help.
Respectively Submitted,
Kerry R. Sweatt
City Manager
xv
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xvi
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, 1995
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.
�E 0fpjCF9
ti MM STATES
AM o
gym« r Preside
SEAL day
Executive Director
xvii
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zviii
FINANCIAL SECTION
(This Page Intentionally Left Blank)
To the Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Independent Auditor's Report
We have audited the accompanying general purpose financial statements of the
City of Schertz, Texas, and the combining financial statements of the City of
Schertz, Texas, as of and for the year ended September 30, 1996, as listed in the
table of contents. These financial statements are the responsibility of the CityFs
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards
and Government Auditing Standards issued by the Comptroller General of the United
States and the provisions of Office of Management and Budget Circular A -128, Audits
of State and Local Governments. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the 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, at September 30, 1996, and the results of its operations and cash
flows of its proprietary fund types for the year then ended, in conformity with
generally accepted accounting principles. Also, in our opinion, the combining
financial statements referred to above present fairly, in all material respects, the
financial position of each of the individual funds of the City of Schertz, Texas,
at September 30, 1996, and the results of operations of such funds and the changes
in individual proprietary funds for the year then ended, in conformity with
generally accepted accounting principles.
In accordance with "Government Auditing Standards," we have also issued a
report dated April 11, 1997 on our consideration of the City of Schertz, Texas'
internal control structure and a report dated April 11, 1997 on its compliance with
laws and regulations.
R. LARRY THOMPSON. C.P.A. / PAUL E. WILLIAMS. C.PA- / JAMES L. BIEDIGER. JR., C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG. JR.. C.P.A.
JOHN LEIF. C.P.A. / H. LEE SCHWARTZMAN. C.P.A. / E GLENN CRAVEY, C.P.A. / FRED J. TIMMONS, C.P.A. / JOHN W. GREEN, C.P.A.
JAMES T McCARTY, C.P.A. (RETIRED) 3
Thompson,
Williams,
Biediger,
NORTH TOWER
u ++ CERTIFIED PUBLIC ACCOUNTANTS
800 N.W. LOOP 410, SUITE 30ON
SAN ANTONIO, TEXAS 78216 -5611
210/341 -2581
1 I,aor
MEMBERS AMERICAN INSTITUTE OF
FAX 210/341.2588
Young, CERTIFIED PUBLIC ACCOUNTANTS
L.C.
To the Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Independent Auditor's Report
We have audited the accompanying general purpose financial statements of the
City of Schertz, Texas, and the combining financial statements of the City of
Schertz, Texas, as of and for the year ended September 30, 1996, as listed in the
table of contents. These financial statements are the responsibility of the CityFs
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards
and Government Auditing Standards issued by the Comptroller General of the United
States and the provisions of Office of Management and Budget Circular A -128, Audits
of State and Local Governments. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the 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, at September 30, 1996, and the results of its operations and cash
flows of its proprietary fund types for the year then ended, in conformity with
generally accepted accounting principles. Also, in our opinion, the combining
financial statements referred to above present fairly, in all material respects, the
financial position of each of the individual funds of the City of Schertz, Texas,
at September 30, 1996, and the results of operations of such funds and the changes
in individual proprietary funds for the year then ended, in conformity with
generally accepted accounting principles.
In accordance with "Government Auditing Standards," we have also issued a
report dated April 11, 1997 on our consideration of the City of Schertz, Texas'
internal control structure and a report dated April 11, 1997 on its compliance with
laws and regulations.
R. LARRY THOMPSON. C.P.A. / PAUL E. WILLIAMS. C.PA- / JAMES L. BIEDIGER. JR., C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG. JR.. C.P.A.
JOHN LEIF. C.P.A. / H. LEE SCHWARTZMAN. C.P.A. / E GLENN CRAVEY, C.P.A. / FRED J. TIMMONS, C.P.A. / JOHN W. GREEN, C.P.A.
JAMES T McCARTY, C.P.A. (RETIRED) 3
(This Page Intentionally Left Blank)
Our audit was made for the purpose of forming an opinion on the general purpose
financial statements taken as a whole and on the combining financial statements.
The accompanying financial information listed as supporting schedules in the table
of contents is presented for purposes of additional analysis and is not a required
part of the financial statements of the City of Schertz, Texas. The information in
these schedules has been subjected to the auditing procedures applied in the audit
of the general purpose and combining financial statements and, in our opinion, is
fairly stated in all material respects in relation to the financial statements of
each of the respective individual funds, taken as a whole.
San Antonio, Texas
April 11, 1997
%��' 404�" '�a q'I' X, a.
Certified Public Accountants
5
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GENERAL PURPOSE FINANCIAL STATEMENTS
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12
CITY OF SCHERTZ, TEXAS
COMBINED STATEMENT OF REVENUES EXPENDITURES,_ AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - GENERAL AND DEBT SERVICE FUND TYPE
YEAR ENDED SEPTEMBER 30, 1996
(See Accompanying Notes to Financial Statements)
13
GENERAL FUND
DEBT SERVICE FUND
VARIANCE
VARIANCE
FAVORABLE
FAVORABLE
BUDGET
ACTUAL
(UNFAVORABLE)
BUDGET
ACTUAL
(UNFAVORABLE)
REVENUES
Taxes
$2,335,401
$2,384,706
$ 49,305
$ -
$ -
$ -
Licenses and Permits
273,750
394,841
121,091
-
-
-
Charges for Services
360,236
375,767
15,531
-
-
-
Fines and Forfeitures
232,000
317,403
85,403
-
-
-
Other
142,215
231,297
89,082
-
1,794
1,794
Total Revenues
$3,343,602
$3,704,014
$360,412
$ -0-
$ 1,794
$ 1,794
EXPENDITURES
Current
General Government
$ 887,973
$ 837,540
$ 50,433
$ -
$ 48,550
$ (48,550)
Public Safety
1,279,301
1,174,371
104,930
-
-
-
Streets and Parks
388,861
304,722
84,139
-
-
-
Health
96,513
85,665
10,828
-
-
-
Recreation
171,907
156,101
15,806
-
-
-
Economic Development
66,257
57,374
8,883
-
-
-
capital Outlay
398,440
452,795
(54,355)
-
-
-
Debt Service
Principal
-
-
-
128,150
656,000
(527,850)
-
-
-
96,462
177,461
(80,999)
Interest
Total Expenditures
$3,289,252
$3,068,588
$220,664
$ 224,612
$ 862,011
$(657,399)
Excess of Revenues Over
(Under) Expenditures
$ 54,350
$ 635,426
$581,076
$(224,612)
$(880,217)
$(655,605)
OTHER FINANCING SOURCES (USES)
Proceeds of Bond Issue
$ -
$ -
$ -
$ -
$ 447,000
$ 447,000
Loan Proceeds
-
87,891
87,891
-
-
-
Operating Transfers (Out)
(224,612)
(224,612)
-
224,612
383,870
159,258
Total Other Financing
Sources (Uses)
$ (224,612)
$ (136,721)
$ 87,891
$ 224,612
$ 830,870
$ 606,258
Excess (Deficiency) of
Revenues and Other Financing
Sources Over Expenditures
and
Other Financing Uses
$$ (170,262)
$ 498,705
668,967
$ -0-
$ (49,347)
$$ (447)
FUND BALANCES - OCTOBER 1, 1995
1,190,501
15,000
FUND BALANCES (DEFICIT)
-
SEPTEMBER 30, 1996
$1,689,206
$ (34,347)
(See Accompanying Notes to Financial Statements)
13
(This Page Intentionally Left Blank)
14
CITY OF SCHERTZ, TEXAS
COMBINED STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN RETAINED EARNINGS -
ALL PROPRIETARY FUND TYPES
YEAR ENDED SEPTEMBER 30, 1996
(WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1995)
OPERATING REVENUE
Fees Charged to Users
Reimbursements and Other
Total Operating Revenue
OPERATING EXPENSES BEFORE
DEPRECIATION
Personal Services
Sewage Treatment
General and Administrative
Contractual Services
Supplies /Maintenance
Bad Debts
Total Operating Expenses
before Depreciation
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 before Other
Financing Sources (Uses)
OTHER FINANCING SOURCES (USES)
Transfers Out
Net Income (Loss)
RETAINED EARNINGS (DEFICIT) -
OCTOBER 1
ENTERPRISE
FUNDS
$2,932,642
43,597
$2,976,239
TOTALS
INTERNAL (MEMORANDUM ONLY)
SERVICE 1996 1995
$ 52,442 $2,985,084 $2,566,288
6,700 50,297 57,026
$ 59,142 $3,035,381 $2,623,314
$ 601,270 $ 22,291 $ 623,561 $ 583,924
414,065 - 414,065 411,336
227,600 - 227,600 229,800
282,712 16,090 298,802 229,854
228,707 30,331 259,038 269,016
78,422 78,422 69,853
$1,832,776 $ 68,712 $1,901,488 $1,793,783
$1,143,463 $ (9,570) $1,133,893 $ 829,531
438,688 2,759 441,447 411,806
$ 704,775 $(12,329) $ 692,446 $ 417,725
$ 123,232 $ - $ 123,232 $ 93,416
(191,560) - (191,560) (224,648)
$ (68,328) $ -0- $ (68,328) $ (131,232)
$ 636,447 $(12,329) $ 624,118 $ 286,493
(159,258) - (159,258) -
$ 477,189 $(12,329) $ 464,860 $ 286,493
712,380 (21,757) 690,623 404,130
RETAINED EARNINGS (DEFICIT) -
SEPTEMBER 30 $1,1189 $04,086) $1,1� 55 $ 690,623
(See Accompanying Notes to Financial Statements)
15
CITY OF SCHERTZ, TEXAS
COMBINED STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES
YEAR ENDED SEPTEMBER 30, 1996
(WITH COMPARATIVE TOTALS FOR SEPTEMBER 30 1995)
TOTALS
ENTERPRISE INTERNAL (MEMORANDUM ONLY)
FUNDS SERVICE 1996 1995
CASH FLOWS FROM OPERATING
ACTIVITIES
Cash Received from Customers
$2,761,751
Cash Payments to Suppliers for
Goods and Services
(334,585)
Cash Payments to Employees
for Services
(597,469)
Cash Received for Reimbursements
and Other
43,597
Net Cash Provided by
Operating Activities
$1,873,294
CASH FLOWS FROM NON - CAPITAL
FINANCING ACTIVITIES
Operating Transfers in (Out)
$ (159,258)
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
Acquisition and Construction
of Capital Assets
$ (502,030)
Bond Issue Costs
(128,985)
Principal Payments on Long -
Term Debt
(1,317,218)
Proceeds from Issuance of
Long -Term Debt
1,253,000
Interest Paid on Long -Term
Debt
(194,139)
Capital Contributed for
Capital Assets
236,908
Net Cash Used in Capital and
Related Financing Activities
$ (652,464)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of Investment
$ (601,663)
Interest on Investments
123,232
Net Cash Provided by (Used in)
Investing Activities
$ (478,431)
Net Increase in Cash
$ 583,141
CASH AND CASH EQUIVALENTS -
BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS -
END OF YEAR
Comprised of
Current Assets
Restricted Assets
CASH AND CASH EQUIVALENTS -
END OF YEAR
$52,380
(35,587)
(22,351)
6,700
1,142
$2,814,131 $ 2,295,311
(370,172) (1,210,461)
(619,820) (581,205)
50,297 57,026
$1,874,436 $ 560,671
$ (159,258) $ -
$(1,142) $ (503,172) $ (205,868)
(128,985) -
- (1,317,218) (239,619)
- 1,253,000 30,020
(194,139) (228,402)
236,908 10,125
$(1,142) $ (653,606) $ (633,744)
$ - $ (601,663) $ -
- 123,232 93,567
$ -0- $ (478,431) $ 93,567
$ -0- $ 583,141 $ 20,494
1,539,216 90 1,539,306 1,518,812
$2,122,357 90 $2,122,447 $1,539,306
$1,281,603 $ 90 $1,281,693 $. 699,053
840,754 - 840,754 840,253
$2,122,357 90 $2,122,447 $1,5
(Continued)
(See Accompanying Notes to Financial Statements)
16
CITY OF SCHERTZ, TEXAS
COMBINED STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES
YEAR ENDED SEPTEMBER 30, 1996
(WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1995)
RECONCILIATION OF OPERATING
INCOME (LOSS) 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
Provision for Uncollectible
Accounts
Change in Assets and
Liabilities
(Increase) Decrease in
Accounts Receivable
(Increase) Decrease in
Inventory
(Increase) Decrease in
Due from Other Funds
(Increase) Decrease in
Prepaid Costs
Increase (Decrease) in
Vouchers Payable
Increase (Decrease) in
Due to Other Funds
Increase (Decrease) in
Accrued Vacation
Increase (Decrease) in
Accrued Interest Payable
Increase (Decrease) in
Customer Deposits
NET CASH PROVIDED BY
OPERATING ACTIVITIES
Supplemental Disclosure
Non -Cash Capital and Related
Financing Transactions
Acquisition and Construction
of Capital Assets
Bond Issued
Note Payable Issued
Federal Financial Assistance
Contributed Capital
TOTALS
ENTERPRISE INTERNAL (MEMORANDUM ONLY)
FUNDS SERVICE 1996 1995
$ 704,775 $(12,329) $692,446 $286,493
441,221 2,759 443,980 411,806
78,422 - 78,422 69,853
(54,671)
-
(54,671)
(61,627)
7,202
615
7,817
24,923
(194,642)
(62)
(194,704)
(759,313)
-
(310)
(310)
-
121,575
-
121,575
6,276
741,481
10,529
752,010
582,899
3,801
(60)
3,741
2,969
-
-
-
(3,754)
24,130
-
24,130
146
$1,873,294 1,142 $1,8� 74 $560,671
$ 502,030 $ 1,142 $ 503,172 $205,868
1,253,000 - 1,253,000 -
- - - 30,020
160,511 - 160,511 -
236,908 - 236,908 10,125
17
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the City of Schertz, Texas, (the City), have been prepared
in conformity with generally accepted accounting principles (GAAP) as applied to
government units. The Government Accounting Standards Board (GASH) is the accepted
standard - setting body for establishing governmental accounting and financial reporting
principles. The more significant of the City's accounting policies are described below.
A. Financial Reporting Entity
The city of Schertz is a city in which citizens elect the mayor and council members
at large. The accompanying financial statements present the City's primary
government and component units over which the City exercises significant influence.
Significant influence or accountability is based primarily on operational or
financial relationships with the city.
1. Blended Component Unit: The Schertz Development Foundation is a nonprofit
corporation organized and operated for charitable purposes, including, but not
limited to, assisting the City of Schertz, Texas, develop and implement economic
viability to the City. The foundation board is chosen by the City Council and the
Executive Director is employed by the City. The books and records are kept by city
personnel. Therefore, the operations of the foundation are reported as a Special
Revenue Fund in the report. Annual reports of the Schertz Development Foundation
for fiscal year ended September 30, 1996 are available upon request from City Hall.
2. Discretely Presented Component Unit: The Library Fund's governing board is
appointed by the Schertz city Council and provides the majority of its funding. The
Library provides a service to citizens outside of the City of Schertz.
B. Fund Accounting
The City uses funds and account groups to report on its financial position and the
results of its operations. Fund accounting is designed to demonstrate legal
compliance and to aid financial management by segregating transactions related to
certain City functions or activities.
A fund is a separate accounting entity with a self - balancing set of accounts. An
account group, on the other hand, is a financial reporting device designed to
provide accountability for certain assets and liabilities that are not recorded in
the funds because they do not directly affect net expendable available financial
resources.
Funds are classified into two categories: governmental and proprietary. Each
category, in turn, is divided into separate "fund types ".
Governmental funds are used to account for all or most of a government's general
activities, including the collection and disbursement of earmarked monies (Special
Revenue Funds), the acquisition or construction of general fixed assets (Capital
Projects Funds), and the servicing of general long -term debt (Debt Service Funds).
The General Fund is used to account for all activities of the City not accounted for
in some other fund.
18
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
B. Fund Accounting (Continued)
Proprietary funds are used to account for activities similar to those found in the
private sector, where the determination of net income is necessary or useful to
sound financial administration. Goods or services from such activities can be
provided either to outside parties (enterprise funds) or to other departments.
C. Basis of Accounting
The accounting and financial reporting treatment applied to a fund is determined by
its measurement focus. All governmental funds are accounted for using a current
financial resources measurement focus. With this.measurement focus, only current
assets and current liabilities generally are included on the balance sheet.
Operating statements of these funds present increases (i.e., revenues and other
financing sources) and decreases (i.e., expenditures and other financing uses) in
net current assets.
All proprietary funds are accounted for on a flow of economic resources measurement
focus. With this measurement focus, all assets and all liabilities associated with
the operation of these funds are included on the balance sheet. Fund equity (i.e.,
net total assets) is segregated into contributed capital and retained earnings
components. Proprietary fund -type operating statements present increases (e.g.,
revenues) and decreases (e.g., expenses) in net total assets.
The modified accrual basis of accounting is used by all governmental fund types.
Under the modified accrual basis of accounting, revenues are recognized when
susceptible to accrual .(i.e., when they become both measurable and available).
"Measurable" means the amount of the transaction can be determined and "available"
means collectible within the current period or soon enough thereafter to be used to
pay liabilities of the current period. The City considers property taxes as
available if they are collected within sixty (60) days after year end. A one -year
availability period is used for revenue recognition for all other governmental fund
revenues. Expenditures are recorded when the related fund liability is incurred.
Principal and interest on general long -term debt are recorded as fund liabilities
when due or when amounts have been accumulated in the Debt Service Fund for payments
to be made early in the following year.
Those revenues susceptible to accrual are property taxes, franchise taxes, special
assessments, interest revenue, and charges for services. Licenses, fines, and
permits are not susceptible to accrual because generally they are not measurable
until received in cash.
The accrual basis of accounting is utilized by proprietary fund types. Under this
method, revenues are recorded when earned and expenses are recorded at the time
liabilities are incurred.
The City reports deferred revenue on its combined balance sheet. Deferred revenues
arise when a potential revenue does not meet both the "measurable" and "available"
criteria for recognition in the current period. Delinquent taxes are reported as
deferred revenue as they are not available for current use.
19
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
C. Basis of Accounting (Continued)
Government funds include the following fund types:
The general fund is the government "s primary operating fund. It
accounts for all financial resources of the general government,
except those required to be accounted for in another fund.
The special revenue funds account for revenue sources that are legally
restricted to expenditure for specific purposes (not including expendable
trusts or major capital projects).
The debt service fund accounts for the servicing of general long -term
debt not being financed by proprietary or nonexpendable trust funds.
The capital projects funds account for the acquisition of fixed assets or
construction of major capital projects not being financed by proprietary
or nonexpendable trust funds.
Enterprise funds are used to account for those operations that are
financed and operated in a manner similar to private business or where the
board has decided that the determination of revenues earned, costs
incurred, and /or net income is necessary for management accountability.
Internal service funds account for the operations that provide services to
other departments or agencies of the government, or to other governments,
on a cost - reimbursement basis.
Proprietary Funds - The proprietary funds consist of Water and Sewer Fund, SAFES
Fund, and the Fleet Service Fund. The proprietary activities apply to all FASB
statements and interpretations issued after November 30, 1989 except for those that
conflict with or contradict GASB pronouncements.
Account Group. The general fixed assets account group is used to account for fixed
assets not accounted for in proprietary or trust funds. The general long -term debt
account group is used to account for general long -term debt and certain other
liabilities that are not specific liabilities of proprietary or trust funds.
D. Budgets
The City Charter establishes requirements for the adoption of budgets and related
budgetary control. Budgetary preparation and control is exercised at the
departmental level. The City Council must approve over - expenditures of
appropriations or transfers of appropriated amounts between departments. Amendments
to budget total are made only by the City Council. The city manager is authorized
to amend the budget without City Council approval by transferring budget amounts
between line items within a department. During the year amendments were necessary,
all complied with city charter requirements.
20
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. Budgets (Continued)
Annual appropriated budgets are adopted for the general and debt service funds. The
budgets are prepared using the modified accrual basis of accounting. All annual
appropriations lapse at fiscal year end. Project - length financial plans are adopted
for all capital projects funds. In addition, as part of the overall budget process,
budgets are adopted for the proprietary fund; however, the City does not require a
reporting as part of the comprehensive annual financial report.
Encumbrances represent commitments related to unperformed contracts for goods or
services. Encumbrance accounting - under which purchase orders, contracts and other
commitments for the expenditure of resources are recorded to reserve that portion
of the applicable appropriation - is utilized in the governmental funds. Any
encumbrances outstanding at year end are reported as reservations of fund balances
and do not constitute expenditures or liabilities because the commitments will be
honored during the subsequent year.
E. Cash and Investments
Cash includes amounts in demand deposits as well as short -term certificates of
deposit with a maturity date within three (3) months of the date acquired by the
City.
Investments generally consists of certificates of deposit with a maturity date
greater than three (3) months of the date acquired by the City and are recorded at
cost, which approximates market value.
F. Short -Term Interfund Receivables /Payables
During the course of operations, numerous transactions occur between individual
funds for goods provided or services rendered. These receivables and payables are
classified as "due from other funds" or "due to other funds" on the balance sheet.
Short -term interfund loans are classified as "interfund receivables /payables ".
G. Inventories
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.
H. 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 covenants. 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.
21
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
I. Fixed Assets
General fixed assets are not capitalized in the funds used to acquire or construct
them. Instead, capital acquisition and construction are reflected as expenditures
in governmental funds, and the related assets are reported in the general fixed
assets account group. All purchased fixed assets are valued at cost where
historical records are available and at an estimated historical cost where no
historical records exist. Donated fixed assets are valued at their estimated fair
market value on the date received.
The costs of normal maintenance and repairs that do not add to the value of the
asset or materially extend asset lives are not capitalized. Improvements are
capitalized and depreciated over the remaining useful lives of the related fixed
assets, as applicable.
Public domain ( "infrastructure ") general fixed assets consisting of roads, bridges,
curbs and gutters, streets and sidewalks, drainage system, and lighting systems are
capitalized.
Assets in the general fixed assets account group are not depreciated. Depreciation
of buildings, equipment, and vehicles in the proprietary fund types is computed
using the straight -line method.
Interest is capitalized on proprietary fund assets acquired with tax - exempt debt.
The amount of interest to be capitalized is calculated by offsetting interest
expense incurred from the date of the borrowing until completion of the project with
interest earned on invested proceeds over the same period.
J. Compensated Absences
Vested or accumulated vacation leave that is expected to be liquidated with
expendable available financial resources is reported as an expenditure and a fund
liability of the governmental fund that will pay it. Amounts of vested or
accumulated vacation leave 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. Vested or accumulated
vacation leave of proprietary funds is recorded as an expense and liability of those
funds as the benefits accrue to employees. In accordance with the provisions of
GASB Statement No. 16, "Accounting for Compensated Absences ", no liability is
recorded for nonvesting accumulating rights to receive sick pay benefits.
K. 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.
22
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
L. 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.
M. Fund Equity
Contributed capital is recorded in proprietary funds that have received capital
grants or contributions from developers, customers, or other funds. Reserves
represent those portions of fund equity not appropriate for expenditure or legally
segregated for a specific future use. Designated fund balances represent tentative
plans for future use of financial resources.
N. 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.
O. 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.
All other interfund transactions, except quasi - external transactions and
reimbursements, are reported as transfers. Nonrecurring or non - routine permanent
transfers of equity are reported as residual equity transfers. All other interfund
transfers are reported as operating transfers.
P. Cash Flows Statement
For purposes of the statement of cash flows, the City considers all highly liquid
investments with an original maturity of approximately ninety days or less to be
cash equivalents.
23
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Q. Memorandum Only - Total Columns
Total columns on the general purpose financial 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 cash flows in conformity with generally accepted accounting principles.
Neither are such data comparable to a consolidation. Interfund eliminations have
not been made in the aggregation of this data.
R. Comparative Data
Comparative total data for the prior year has been presented in the accompanying
financial statements in order to provide an understanding of changes in the
governmentfs financial position and operations.
S. 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.
T. Reclassifications
Certain reclassifications have been made to the 1995 comparative totals to conform
to the 1996 presentation.
NOTE 2: LEGAL COMPLIANCE - BUDGETS
On or before July each year, all agencies of the City submit request for appropriation
to the City Manager so that a budget may be prepared. The budget is prepared by fund,
department, function, and activity, and includes information on the past year, current
year estimates and requested appropriations for the next fiscal year.
Before September 30, the proposed budget is presented to the City Council for review,
modification, and approval. By state statute budgeted expenditures may not exceed
budgeted revenues.
Expenditures may not legally exceed budgeted appropriations at the fund level.
NOTE 3: DEPOSITS WITH FINANCIAL INSTITUTIONS
The City maintains demand deposit accounts, savings accounts, certificates of deposit,
and U. S. Treasury bills that are available for the individual funds from which they are
generated. The funds accounts are displayed on the combined balance sheet under the
captions "Cash and Cash Equivalents" or "Investments."
24
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 3: DEPOSITS WITH FINANCIAL INSTITUTIONS (CONTINUED)
At September 30, 1996, cash deposits with financial institutions amounted to $3,066,284
and Treasury bills totaled $601,663. Bank balances totaled $4,206,199 and were entirely
collateralized by securities held by the City's agent in the City's name.
There are three (3) categories of risk that apply to the City's bank balances:
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 pledging financial institution's trust
department of the City's agent in the City's name.
3. Uncollateralized.
Deposits, categorized by level of risk are:
PRIMARY GOVERNMENT
Cash and Cash Equivalents
Investments
TOTALS
COMPONENT UNIT
Cash and Cash Equivalents
Investments
TOTALS
COLLATERAL
CATEGORY CARRYING MARKET
1 2 3 AMOUNT VALUE
$3,006,284 $ - $ - $3,006,284 $6,052,188
601,663 - - 601,663 608,527
$3,607,947 $3,607,947 $6,660,715
$ 10,483 $ - $ - $ 10,481 $ 10,483
$ 10.483, 0 0- $ 10,481 $ 10,483
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 or 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
deposits issued by state and national banks domiciled in Texas that are guaranteed or
insured by the Federal Deposit Insurance Corporation or its successor, or secured by
obligations mentioned above; and (6) fully collateralized direct repurchase agreements
having a defined termination date.
For fiscal year September 30, 1996, the City invested in demand deposits, certificates
of deposit, and U. S. Treasury bills.
25
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 4: RECEIVABLES
Receivables at September 30, 1996 consist of the following:
NET TOTAL RECEIVABLES
$101.188 $14,512 $389.147 $504,847
The delinquent taxes receivable account represents past years of uncollected tax levies
and is also reflected as a deferred revenue of equal amount.
Property taxes are levied as of October 1 on property values assessed as of January 1.
Property taxes are payable on or before January 31 following the levy date without
penalty or interest. Unpaid property taxes attach as an enforceable lien on property
as of February 1 with penalty and interest. On July 1, unpaid taxes are forwarded for
collection and are subject to additional penalties for collection expenses.
NOTE 5: GENERAL FIXED ASSETS
The following is a summary of changes in general fixed assets:
BALANCES AT
DEBT
BALANCES AT
OCTOBER 1,
GENERAL
SERVICE
ENTERPRISE
TOTAL
RECEIVABLES
1996
Land
$ 423,460
$ - $ -
Taxes
$ 74,583
$15,276
$ -
$ 89,859
Account
30,334
-
508,657
538,991
Gross Receivables
$104,917
$15,276
$508,657
$628,850
Less: Allowance for
1,092,935
Equipment
1,027,942
106,297
Uncollectible
3,729
764
119,510
124,003
NET TOTAL RECEIVABLES
$101.188 $14,512 $389.147 $504,847
The delinquent taxes receivable account represents past years of uncollected tax levies
and is also reflected as a deferred revenue of equal amount.
Property taxes are levied as of October 1 on property values assessed as of January 1.
Property taxes are payable on or before January 31 following the levy date without
penalty or interest. Unpaid property taxes attach as an enforceable lien on property
as of February 1 with penalty and interest. On July 1, unpaid taxes are forwarded for
collection and are subject to additional penalties for collection expenses.
NOTE 5: GENERAL FIXED ASSETS
The following is a summary of changes in general fixed assets:
$11,228,539 $492,727 $ -0- $11,721,266
*Adjusted to Include Land of $15,739 in the Schertz Development Foundation
26
BALANCES AT
BALANCES AT
OCTOBER 1,
SEPTEMBER 30,
1995
ADDITIONS DEDUCTIONS
1996
Land
$ 423,460
$ - $ -
$ 423,460
Buildings
1,114,290
- -
1,114,290
Improvements Other than
Buildings
7,922,195
34,147 -
7,956,342
Vehicles
740,652
352,283 -
1,092,935
Equipment
1,027,942
106,297
1,134,239
$11,228,539 $492,727 $ -0- $11,721,266
*Adjusted to Include Land of $15,739 in the Schertz Development Foundation
26
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 6: FIXED ASSETS - PROPRIETARY FUND TYPES
The following is a summary of the property, plant, and equipment of the Proprietary
Funds at September 30, 1996:
Buildings
Improvements Other than Buildings
Machinery and Equipment
Construction in Progress
Accumulated Depreciation
Land
ENTERPI
WATER /SEWER
$ 195,724
9,505,982
615,046
100,490
$10,417,242
5,308,340
$ 5,108,902
160,521
USE INTERNAL
SAFES SERVICE TOTAL
$ 26,656 $59,946 $ 282,326
- - 9,505,982
470,158 25,198 1,110,402
100,490
$496,814 $85,144 $10,999,200
297,754 26,411 5,632,505
$199,060 $58,733 $ 5,366,695
160,521
TOTALS $ 5,269,423 $199,060 $58,733 $ 5,527,216
In the proprietary and internal service funds, the following useful lives are used to
compute depreciation:
Buildings
Sewer and Water Lines
Equipment
NOTE 7: LONG -TERM DEBT
A. Advance Refunding
30 Years
50 Years
5 - 10 Years
In October, 1995, the City issued $1,700,000 of General Obligation Refunding Bonds
with an interest rate ranging from 3.75`•k to 5.00`k to advance refund a total of
$1,525,000 of bonds from the General Long -Term Debt Account Group and the Water and
Sewer Fund. The proceeds of the refunding bonds were used to purchase U. S. Obligations
or their equivalent in an escrow account of the trust department of the paying agent
bank, to provide resources for all future debt service payments of the bonds being
refunded.
The advance refunding resulted in a total debt service savings of $140,778 and a
present value economic benefit of $95,186.
27
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 7: LONG -TERM DEBT (CONTINUED)
B. General Long -Term Debt
The following is a summary of changes in general long -term debt for the year ended
September 30, 1996:
Certificates
of Obligation
1990 Series
General Obligation
Refunding Bonds
1995 Series
Notes Payable -
Bank
Due November,
1996
Notes Payable -
Bank
Due September,
1997
TOTAL GENERAL
OBLIGATION
BONDS,
CERTIFICATES
OF OBLIGA-
TION, GENERAL
OBLIGATION
REFUNDING
BONDS, AND
NOTES PAYABLE
850,000 7 - 9.0% $ 695,000 $ - $315,000
447,000
$ 42,891
45,000
3.75 -
5.00% $ - $447,000 $ 29,000
9.25% $ - $ 42,891 $
$380,000
$418,000
$ 42,891
8.00% - 45,000 45,000
$ -0- $ 87,891 $ -0- $ 87,891
$1,804,000 $534,891 $656.000 $1,682
28
BALANCE
BALANCE
OUTSTANDING
OUTSTANDING
ORIGINAL
INTEREST
OCTOBER 1,
DURING YEAR
SEPTEMBER 30,
AMOUNT
RATE
1995
ISSUED RETIRED
1996
General
Obligation
Bonds
1962
Series
$301,000
3.63%
$ 74,000
$ - $ 12,000
$ 62,000
1975
Series
175,000
6.2 - 7.0%
130,000
- 130,000
-
1987
Series
445,000
6.2 - 8.3%
310,000
- 145,000
165,000
1992
Series
620,000
5.2 - 7.2%
595,000
- 25,000
570,000
$1.109,000
$ -0- $312,000
$797,000
Certificates
of Obligation
1990 Series
General Obligation
Refunding Bonds
1995 Series
Notes Payable -
Bank
Due November,
1996
Notes Payable -
Bank
Due September,
1997
TOTAL GENERAL
OBLIGATION
BONDS,
CERTIFICATES
OF OBLIGA-
TION, GENERAL
OBLIGATION
REFUNDING
BONDS, AND
NOTES PAYABLE
850,000 7 - 9.0% $ 695,000 $ - $315,000
447,000
$ 42,891
45,000
3.75 -
5.00% $ - $447,000 $ 29,000
9.25% $ - $ 42,891 $
$380,000
$418,000
$ 42,891
8.00% - 45,000 45,000
$ -0- $ 87,891 $ -0- $ 87,891
$1,804,000 $534,891 $656.000 $1,682
28
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 7: LONG -TERM DEBT (CONTINUED)
B. General Long -Term Debt (Continued)
C. Proprietary Long -Term Debt
The following is a summary of changes in proprietary long -term debt for the year ended
September 30, 1996:
BALANCE BALANCE
OUTSTANDING OUTSTANDING
ORIGINAL INTEREST OCTOBER 1, SEPTEMBER 30,
AMOUNT RATE 1995 ISSUED RETIRED 1996
Revenue Bonds
1973
BALANCE
$ 165,000
5.75
BALANCE
165,000 $
OUTSTANDING
1975
Series
OUTSTANDING
7.00
OCTOBER 1,
205,000
- 205,000 -
SEPTEMBER 30,
Series
1995
ADDITIONS
DEDUCTIONS
1996
- 185,000 -
Compensated Absences Payable
$108,856
$20,617
$ -0-
$129,473
900,000
- 15,000 885,000
GENERAL
OBLIGATION
YEAR ENDED
NOTES
REFUNDING
GENERAL
CERTIFICATE OF
SEPTEMBER 30,
PAYABLE
BONDS
OBLIGATION
OBLIGATION
1997
$95,469
$ 66,175
$ 119,365
$ 75,948
1998
-
62,248
120,669
76,772
1999
-
39,755
120,546
77,718
2000
-
38,661
116,375
78,231
2001
-
91,265
64,093
73,519
2002 -2006
-
211,162
388,650
88,081
Thereafter
-
-
185,310
-
TOTAL
$95,469
$509,266
$1,115,008
$470,269
Principal
$87,891
$418,000
$ 797,000
$380,000
Interest
7,578
91,266
318,008
90,269
TOTAL
$95,469
$509,266
$1,115
$470,269
C. Proprietary Long -Term Debt
The following is a summary of changes in proprietary long -term debt for the year ended
September 30, 1996:
BALANCE BALANCE
OUTSTANDING OUTSTANDING
ORIGINAL INTEREST OCTOBER 1, SEPTEMBER 30,
AMOUNT RATE 1995 ISSUED RETIRED 1996
Revenue Bonds
1973
Series
$ 165,000
5.75
- 6.10% $
165,000 $
- $ 40,000 $ 125,000
1975
Series
325,000
7.00
- 7.75%
205,000
- 205,000 -
1981
Series
475,000
9.00
- 10.0%
185,000
- 185,000 -
1988
Series
1,020,000
6.30
- 8.30%
900,000
- 15,000 885,000
$1,455,000 $ -0- $445,000 $1,0� 100
29
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 7: LONG -TERM DEBT (CONTINUED)
C. Proprietary Long -Term Debt (Continued)
30
BALANCE
BALANCE
OUTSTANDING
OUTSTANDING
ORIGINAL INTEREST
OCTOBER 1,
SEPTEMBER 30,
AMOUNT RATE
1995
ISSUED
RETIRED
1996
Certificates
of obliga-
tion
1981 Series
$ 150,000 9.30 - 10.00%
$ 55,000
$ -
$ 55,000
$ -
1983 Series
1,250,000 8.20 - 10.00%
745,000
-
660,000
85,000
1992 Series
200,000,5.00 - 7.00%
1801000
-
10,000
170,000
$$ 980.000
$ -0- $725,000
$ 255,000
General Obliga-
tion Refunding
Bonds
1995 Series
$1,253,000 3.75 - 5.00%
-
$1,253,000 91,000
$1,162,000
BALANCE
BALANCE
OUTSTANDING
OUTSTANDING
ORIGINAL INTEREST
OCTOBER 1,
SEPTEMBER 30,
AMOUNT RATE
1995
ISSUED
RETIRED
1996
Public
Facility
-Loan (HUD)
$142,000 5.00%
84,000
$ -0-
4,000
$ 80,000
Note Payable
$273,000 7.60%
$196,017
$ -
$22,198
$173,819
Note Payable
$ 30,000 8.25%
30,020
-
30,020
-
$226,037
$ -0-
$52,218
$173,819
The annual requirements to amortize all debt outstanding
as of September 30, 1996
including interest payments are as follows:
GENERAL
OBLIGATION
CERTIFICATES
PUBLIC
YEAR ENDED
REFUNDING REVENUE
OF
FACILITY
NOTES
SEPTEMBER 30,
BONDS
BONDS OBLIGATION
LOAN
PAYABLE
1997
$ 132,226 $
125,578
$112,310
$ 8,000
$ 37,212
1998
228,748
122,012
18,960
7,800
37,212
1999
221,953
143,588
18,390
7,600
37,212
2000
272,524
93,375
17,890
7,400
37,212
2001
271,207
90,750
17,380
7,200
37,212
2002 -2006
235,097
797,437
130,320
33,000
37,213
Thereafter
-
133,563
51,000
-
TOTALS
$1,361,755 $1,506,303
$315,250
$122,000
$223,273
30
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 7: LONG -TERM DEBT (CONTINUED)
C. Proprietary
Long -Term Debt (Continued)
GENERAL
OBLIGATION
YEAR ENDED
REFUNDING
REVENUE
SEPTEMBER 30,
BONDS
BONDS
Principal
$1,162,000
$1,010,000
Interest
199,755
496,303
TOTALS
$1,361,755
$1,506,303
CERTIFICATES PUBLIC
OF FACILITY NOTES
OBLIGATION LOAN PAYABLE
$255,000 $ 80,000 $173,819
60,250 42,000 49,454
$315,250 $122,000 $223,273
Bonded debt of the City consists of various series of general obligation bonds, revenue
bonds, certificates of obligation, public facility loan (HUD), public property finance
contractual obligations, and two notes 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 water and sewer fund. The debenture
agreement for water and sewer bonds require funds be available for 1 /12th the principal
and 1 /6th the 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 payments of first lien revenue bonds. The public
loan is payable from gross revenue derived from operations of the water and sewer systems
and has equal status with first lien revenue bonds. Public property finance contractual
obligations are payable from a levy of ad valorem taxes upon all taxable property within
the City. The notes payable are 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.
NOTE 8: INTERFUND ASSETS /LIABILITIES
The following is a summary of amounts due from and due to primary government and blended
component units as of September 30, 1996:
General Fund
Special Revenue Funds
Schertz Development Foundation
Forestry
Debt Service
Capital Projects
Enterprise Funds
Water and Sewer System
SAFES
Internal Service Fund
TOTALS
31
DUE FROM DUE TO
OTHER FUNDS OTHER FUNDS
$1,822,032 $ 859,509
218
376,668
1,061,091
1,911
62
758
269,360
571,516
1,459,375
70,611
30,853
$3,261,982 $3.26
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 8: INTERFUND ASSETS /LIABILITIES (CONTINUED)
The following is a summary of amounts due to and due from primary government and
discretely presented component units.
DUE FROM DUE TO
COMPONENT PRIMARY
UNIT GOVERNMENT
General Fund $115 $ -0-
Library Fund 115
TOTALS 115 115
NOTE 9: 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,
1996, is as follows:
Operating Revenues
Operating Expenses, Exclusive of
Depreciation and Amortization
Depreciation
Operating Income
Other Income (Expenses)
Net Income before Transfers
Transfers Out
NET INCOME
Total Assets
Total Equity
Working Capital
Additions to Fixed Assets
Outstanding Debt
NOTE 10: CONTRIBUTED CAPITAL
WATER /SEWER SAFES TOTAL
$2,390,600 $585,639 $2,976,239
(1,325,796) (506,980)
(397,619) (41,069)
$ 667,185 $ 37,590
(82,489) 14,161
$ 584,696 $ 51,751
(159,258) -
(1,832,776)
(438,688)
$ 704,775
(68,328)
$ 636,447
(159,258)
$ 425,438 51,751 $ 477,189
$9,204,267
$644,067
$9,848,334
$4,643,219
$560.207
$5,203,426
$1,258,368
$361,147
$1,619,515
$ 457,127
$ 45,134
$ 502,261
$2,680,819
$ -0-
$2,680,819
During the year, contributed capital increased by the following amounts:
32
WATER AND
INTERNAL
SEWER
SAFES
SERVICE
SOURCE
FUND
FUND
FUND
TOTAL
Developers
$ 78,930
$ -
$ -
$ 78,930
Federal Financial Assistance
160,511
-
-
160,511
Less: Depreciation on Contribution
(2,533)
-
-
(2,533)
Totals
$ 236,908
$ -0-
$ -0-
$ 236,908
Contributed Capital, October 1
3,550,180
226,769
63,577
3,840,526
CONTRIBUTED CAPITAL, SEPTEMBER 30
$3,787,088
$226,769
$63,577
$4,077,434
32
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 11: OPERATING TRANSFERS
Operating transfers are comprised as follows:
General Fund
Water and Sewer Fund
Debt Service Fund
NOTE 12: DEFICIT RETAINED EARNINGS
IN OUT
383,870
$224,612
159,258
For the year ended September 30, 1996, the Internal Service Fund has a deficit retained
earnings balance of $34,086. This occurred again because sufficient transfers were not
made from other funds to supplement revenue in order to exceed expenditures. Transfers
from other funds will be adjusted in 1997 to offset this deficit balance. The Debt
Service Fund had a deficit fund balance of $34,347 because transfers from the General Fund
and Water and Sewer Fund were too low. Transfers will be adjusted in 1997.
NOTE 13: PENSION PLAN
Description
The City provides pension benefits for all of its full -time employees through a
nontraditional, joint contributory, defined contribution plan in the state -wide Texas
Municipal Retirement System (TMRS), one of over 670 administered by TMRS, an agent
multiple - employer public employee retirement system. It is the opinion of the TMRS
management that the plans in TMRS are substantially defined contribution plans, but they
have elected to provide additional voluntary disclosure to help foster a better
understanding of some of the nontraditional characteristics of the plan.
Benefits depend upon the sum of the employee's contributions to the plan, with interest,
and the City - financed monetary credits, with interest. At the 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 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 contribution 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.
33
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
NOTE 13: PENSION PLAN (CONTINUED)
Description (Continued)
Members can retire at ages sixty (60) and above with ten (10) or more years of service or
with twenty -five (25) years of service regardless of age. The plan also provides death
and disability benefits. A member is vested after ten (10) years, but he must leave his
accumulated contributions in the plan. If a member withdraws his own money, he is not
entitled to the employer- financed monetary credits, even if he was vested. ' The plan
provisions are adopted by the governing body of the City, within the options available in
the state statutes governing TMRS and within the actuarial constraints also in the
statutes.
Contributions
The contribution rate for the employees is 5%, and the City matching percent is currently
100`•k, both as adopted by the governing body of the City. Under the state law governing
TMRS, the City contribution rate is annually determined by the actuary. This rate
consists of the normal cost contribution rate and the prior service contribution rate,
both of which are calculated to be a level percent of payroll from year to year. The
normal cost contribution rate finances the currently accruing monetary credits due to City
matching percent, which are the obligation of the City as of an employee's retirement
date, not at the time the employee's contributions are made. The normal cost contribution
rate is the actuarially determined percent of payroll necessary to satisfy the obligation
of the City to each employee at the time his retirement becomes effective. The prior
service contribution rate amortizes the unfunded actuarial liability over the remainder
of the plan's twenty -five (25) year amortization period. When the City periodically
adopts updated service credits and increases in annuities in effect, the increased
unfunded actuarial liability is to be amortized over a new twenty -five (25) year period.
Currently, the unfunded actuarial liability is being amortized over the twenty -five (25)
year period which began September, 1994. 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 (1) year lag between the actuarial valuation that is the
basis for the rate and the calendar year when the rate goes into effect.
The City's total payroll in fiscal year 1996 was $2,133,469 and the City's contributions
were based on a payroll of $1,794,550. Both the City and the covered employees made the
required contributions, amounting to $91,335, (15.12% for the months in calendar year
1995, 3.15% normal cost plus 1.97% to amortize the unfunded actuarial liability and 5.08%
for the months in calendar year 1996, 3.23% normal cost plus 1.85% to amortize the
unfunded actuarial liability) for the City and $89,678 (5%) for the employees. There were
no related -party transactions.
34
CITY OF SCHERT2, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 30, 1996
NOTE 13: PENSION PLAN (CONTINUED)
Funding Status and Progress
Even though the substance of the City's plan is not to provide a defined benefit in some
form, some additional voluntary disclosure is appropriate due to the nontraditional nature
of the defined contribution plan which had an initial unfunded pension benefit obligation
due to the monetary credits granted by the City for services rendered before the plan
began and which can have additions to the unfunded pension benefit obligation through the
periodic adoption of increases in benefit credits and benefits. Statement No. 5 of the
Governmental Accounting Standards Board (GASB 5) defines pension benefit obligation as a
standardized disclosure measure of the actuarial present value of pension benefits,
adjusted for the effects of projected salary increases, estimated to be payable in the
future as a result of employee service to date. The measure is intended to help users
assess the funding status of public employee pension plans, assess progress made in
accumulating sufficient assets to pay benefits when due, and make comparisons among public
employee pension plans.
The pension benefit obligation shown below is similar in nature to the standardized
disclosure measure required by GASB 5 for defined benefit plans except that there is no
need to project salary increases since the benefit credits earned for service to date are
not dependent upon future salaries. The calculations were made as part of the annual
actuarial valuation as of December 31, 1995. Because of the money - purchase nature of the
plan the interest rate assumption, currently 8.0% per year, does not have as much impact
on the results as it does for a defined benefit plan. Market value of assets is not
determined for each city's plan, but the market value of assets for TMRS as a whole was
114.2% of book value as of December 31, 1995.
Pension Benefit Obligation
Annuitants Currently Receiving Benefits $ 157,727
Terminated Employees 40,742
Current Employees
Accumulated Employee Contributions Including
Allocated Invested Earnings 248,592
Employer- Financed Vested 448,594
Employer- Financed Nonvested 153,771
TOTAL $1,049,426
Net Assets Available for Benefits, at Book Value $ 43,745
Unfunded Pension Benefit Obligation $ 555,681
35
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 30, 1996
NOTE 13: PENSION PLAN (CONTINUED)
The book value of assets is amortized cost for bonds and original cost for short -term
securities and stocks. The actuarial assumptions used to compute the actuarially
determined city contribution rate are the same as those used to compute the pension
benefit obligation.
Trend Information
The ten (10) year historical trend information is being developed prospectively.
Because the City joined the Texas Municipal Retirement System (TMRS) during 1993, only
information for the last three (3) years is available as follows:
Net Assets Available for Benefits
Pension Benefit Obligation
Percentage Funded
Unfunded (Assets in Excess of) Pension
Benefit Obligation
Annual Covered Payroll
Unfunded Pension Benefit Obligation
as a % to Payroll
City Contribution to TMRS
Average City Rate
NOTE 14: MARKETABLE SECURITIES
YEAR ENDED SEPTEMBER 30,
1996 1995 1994
$ 493,745 $ 320,126 $ 133,346
$1,049,426 $ 876,870 $ 654,382
47.05% 36.51% 20.38%
$ 555,681 $ 556,744 $ 521,030
$1,794,550 $1,844,503 $1,633,320
30.97% 30.18% 31.90%
$ 91,335 $91,702 $ 70,991
5.09% 4.97% 4.35%
At September 30, 1996, the marketable securities portfolio was comprised of one U. S.
Treasury bill that the City of Schertz, Texas, has the intent and ability to hold to
maturity. In accordance with FASB No. 115, these securities are carried at cost,
adjusted for amortization of premiums and accretions of discounts.
The amortized cost and fair value of marketable securities held to maturity at
September 30, 1996 were:
Securities to be Held to Maturity -
U. S. Treasury Bill (Maturing in
August, 1997)
36
GROSS
AMORTIZED UNREALIZED FAIR
COST GAINS VALUE
$601.663, $6,864 $608,527
CITY OF SCHERTZ, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 30, 1996
NOTE 15: RISK MANAGEMENT
The City is exposed to various risks of loss related to torts; theft of, damage to, and
destruction of assets; errors and omissions; injuries to employees; and natural
disasters. During October 1991, the City was unable to obtain insurance at a cost it
considered economically justifiable. In October, 1991, the City entered into a
contractual agreement 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 Intergovernmental Risk Pool has published its own financial
report for the year ended September 30, 1996, which can be obtained from the Texas
Municipal League.
NOTE 16: COMMITMENTS AND CONTINGENCIES
Vehicles owned by the City that are older than four years are covered only by liability
insurance. The City has designated $45,000 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, 1996.
37
(This Page Intentionally Left Blank)
36
COMBINING, INDIVIDUAL FUND AND
ACCOUNT GROUP STATEMENTS AND SCHEDULES
(This Page Intentionally Left Blank)
40
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.
41
(This Page Intentionally Left Blank)
vl
CITY OF SCHERTZ, TEXAS
GENERAL FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 1996 AND 1995
ASSETS
Cash and Cash Equivalents
Accounts Receivable
Delinquent Taxes Receivable (Net of Allowances)
Due from Other Funds
Inventory of Supplies, at Cost
Other Receivables
TOTAL ASSETS
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts Payable
Due to Other Funds
Deferred Revenue
Total Liabilities
FUND BALANCES
Reserved for Park Improvements
Reserved for Forfeited Property
Reserved for Inventory of Supplies
Unreserved
Designated for Economic Development
Designated for Equipment Replacement
Designated for Self- Insurance
Undesignated
Total Fund Balances
TOTAL LIABILITIES AND FUND BALANCES
(See Accompanying Notes to Financial Statements)
43
SEPTEMBER 30,
1996 1995
$ 714,563 $ 947,237
30,334 13,172
70,854 63,418
1,822,147 540,391
12,398 13,058
169
$2,650,296 $1,577,445
$ 30,727 $ 51,087
859,509 272,439
70,854 63,418
$ 961,090 $ 386,944
$ 83,134 $ 1,073
19,980 3,489
12,398 13,059
18,821 18,821
15,144 15,144
45,000 45,000
1,494,729 1,093,915
$1,689,206 $1,190,501
$2,650,296 $1,577,445
CITY OF SCHERTZ, TEXAS
GENERAL FUND
COMPARATIVE SCHEDULES OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
YEAR ENDED SEPTEMBER 30, 1996
OTHER FINANCIAL SOURCES (USES)
Loan Proceeds
Operating Transfers - (Out)
Total Other Financial
Sources (Uses)
Excess of Revenues and
Other Financing Sources
over Expenditures and
Other Financing Uses
FUND BALANCES - OCTOBER 1
FUND BALANCES -
SEPTEMBER 30
$ - $ 87,891
(224,612) (224,612)
$ (224,612) $ (136,721)
$ (170) $ 498,705
44
1,190,501
$1,6 1 206
$ 87,891 $ -
(242,879)
$ 87,891
$ 668,967
$ (242,879)
$ 404,727
785,774
$1,190,501
1996
VARIANCE
FAVORABLE
1995
BUDGET
ACTUAL
(UNFAVORABLE)
ACTUAL
REVENUES
Taxes
$2,335,401
$2,384,706
$ 49,305
$2,285,735
Licenses and Permits
273,750
394,841
121,091
134,391
Charges for Services
360,236
375,767
15,531
353,050
Fines and Forfeitures
232,000
317,403
85,403
209,719
Other Sources
142,215
231,297
89,082
291,864
Total Revenues
$3,343,602
$3,704,014
$360,412
$3,274,759
EXPENDITURES
Current
General Government
$ 887,973
$ 837,540
$ 50,433
$ 813,789
Public Safety
1,279,301
1,174,371
104,930
1,059,331
Streets and Parks
388,861
304,722
84,139
349,659
Health
96,513
85,685
10,828
80,324
Recreation
171,907
156,101
15,806
176,062
Economic Development
66,257
57,374
8,883
52,989
Capital Outlay
398,440
452,795
(54,355)
94,999
Total Expenditures
$3,289,252
$3,068,588
$220,664
$2,627,153
Excess of Revenues over
Expenditures
$ 54,350
$ 635,426
$581,076
$ 647,606
OTHER FINANCIAL SOURCES (USES)
Loan Proceeds
Operating Transfers - (Out)
Total Other Financial
Sources (Uses)
Excess of Revenues and
Other Financing Sources
over Expenditures and
Other Financing Uses
FUND BALANCES - OCTOBER 1
FUND BALANCES -
SEPTEMBER 30
$ - $ 87,891
(224,612) (224,612)
$ (224,612) $ (136,721)
$ (170) $ 498,705
44
1,190,501
$1,6 1 206
$ 87,891 $ -
(242,879)
$ 87,891
$ 668,967
$ (242,879)
$ 404,727
785,774
$1,190,501
CITY OF SCHERTZ, TEXAS
GENERAL FUND
SCHEDULE OF REVENUES COMPARED TO BUDGET
YEAR ENDED SEPTEMBER 30, 1996
REVENUES
Taxes
Ad Valorem
Tax Penalty
City Sales Tax
Utility Franchise
Other
Total Taxes
Licenses and Permits
Charges for Services
Utility Administration
Swimming Pool
Animal Shelter
Building Rental
Library and Fire
Other
Total Charges for Services
Fines and Forfeitures
Other Sources
Reimbursements
Proceeds from Litigation
Cibolo Creek Municipal Authority
Interest
Sale of Assets
Sale of Recycled Materials
Miscellaneous
State and Federal Grants
Total Other Sources
TOTAL REVENUES
1996
VARIANCE
FAVORABLE 1995
BUDGET ACTUAL (UNFAVORABLE) ACTUAL
$1,345,531 $1,356,184
12,000 10,304
715,000 760,667
248,870 243,403
14,000 14,148
$2,335,401 $2,384,706
$ 10,653 $1,303,562
(1,696) 11,976
45,667 697,713
(5,467) 242,218
148 30,266
$ 49,305 $2,285,735
$ 273,750 $ 394,841 $121,091 $ 134,391
$ 210,000
$ 225,000
$ 15,000
$ 210,000
31,500
29,796
(1,704)
27,087
4,300
4,925
625
4,575
6,800
7,342
542
6,423
79,836
85,436
5,600•
81,761
27,800
23,268
(4,532)
23,204
$ 360,236
$ 375,767
$ 15,531
$ 353,050
$ 232,000
$ 317,403
$ 85,403
$ 209,719
$ 15,000
$ 43,355
$ 28,355
$ 25,630
-
16,850
16,850
155,534
6,200
6,106
(94)
6,289
12,805
31,703
18,898
25,121
-
-
-
25,000
22,000
22,323
323
22,371
50,910
85,690
34,780
31,919
35,300
25,270
(10,030)
-
$ 142,215
$ 231,297
$ 89,082
$ 291,864
$3,343,602
$3,704,014
$360.412,
$3,2759
45
CITY OF SCHERTZ, TEXAS
GENERAL FUND
SCHEDULE OF EXPENDITURES COMPARED TO BUDGET
YEAR ENDED SEPTEMBER 30, 1996
Public Safet
Police Department
$ 888,860
1996
$ 62,366
$ 742,916
Fire Department
329,786
291,330
VARIANCE
263,430
Inspection
60,655
56,547
FAVORABLE
1995
Total Public Safety
BUDGET
ACTUAL
(UNFAVORABLE)
ACTUAL
CURRENT
General Government
$ 298,751
$ 223,082
$ 75,669
$ 245,334
City Council
$ 19,688
$ 16,795
$ 2,893
$ 18,645
City Manager
217,595
201,206
16,389
178,606
Tax
85,293
78,777
6,516
78,626
Planning and Zoning
124,855
126,716
(1,861)
108,402
Legal
43,000
56,922
(13,922)
80,821
Municipal Court
70,207
67,059
3,148
53,723
Municipal Building
115,127
109,006
6,121
100,865
General Administration
101,508
87,772
13,736
98,302
Other - Unclassified
110,700
93,287
17,413
95,799
Total General Government
$ 887,973
$ 837,540
$ 50,433
$ 813,789
Public Safet
Police Department
$ 888,860
$ 826,494
$ 62,366
$ 742,916
Fire Department
329,786
291,330
38,456
263,430
Inspection
60,655
56,547
4,108
52,985
Total Public Safety
$1,279,301
$1,174,371
$104,930
$1,059,331
Streets and Parks
Streets
$ 298,751
$ 223,082
$ 75,669
$ 245,334
Parks
90,110
81,640
8,470
104,325
Total Streets and Parks
$ 388,861
$ 304,722
$ 84,139
$ 349,659
Health
Animal Control
$ 96,513
$ 85,685
$ 10,828
$ 80,324
Recreation
Swimming Pool
$ 59,840
$ 50,794
$ 9,046
$ 50,498
Library
112,067
105,307
6,760
125,564
Total Recreation
$ 171,907
$ 156,101
$ 15,806
$ 176,062
Economic Development
$ 660257
$ 57,374
$ 8,883
$ 52,989
CAPITAL OUTLAY
$ 398,440
$ 452,795
$(54,355)
$ 94,999
TOTAL EXPENDITURES
$3,289,252
$3,0
$220,664
$2,627,153
46
SPECIAL REVENUE FUNDS
Special Revenue Funds account for the proceeds of specific revenue sources (other than
expendable trusts or for major capital projects) that are legally restricted to
expenditure for specified purposes.
Tax Increment Financing Fund - will account for the proceeds of designated property taxes
to be used for the widening of Schertz Parkway.
Hotel Occupancy Tax Fund - will account for proceeds of hotel occupancy taxes to be used
strictly for those kinds of programs that promote the tourism industry.
Forestry Fund - will account for funds from a state grant to be used for purchasing trees
and shrubs for City parks.
Schertz Development Foundation - will account for donations to the foundation and other
revenues for the development of economic viability to the City.
47
CITY OF SCHERTZ, TEXAS
SPECIAL REVENUE FUNDS
COMBINING BALANCE SHEET
SEPTEMBER 30, 1996
(WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1995)
TAX HOTEL SCHERTZ
INCREMENT OCCUPANCY DEVELOPMENT TOTALS
FINANCING TAX FORESTRY FOUNDATION 1996 1995
ASSETS
Cash and Cash
Equivalents
Investments
Due from Other Funds
TOTAL ASSETS
LIABILITIES AND
FUND BALANCES
LIABILITIES
Due to Other Funds
FUND BALANCES
Unreserved
Designated
TOTAL LIABILITIES
AND FUND BALANCES
$1,687 $3,372 $853 $49,214 $55,126 $ 7,278
- - - - - 41,819
218 218 218
$1,687 $3,372 853 $49,,432 $55,344 $49J15
$ - $ - $758 $ - $ 758 $ 763
1,687 3,372 95 49,432 54,586 48,552
$1,687 3,372 853 $49,432 $55,344 $49,315
(See Accompanying Notes to Financial Statements)
48
CITY OF SCHERTZ, TEXAS
SPECIAL REVENUE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
YEAR ENDED SEPTEMBER 30, 1996
(WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1995)
(See Accompanying Notes to Financial Statements)
49
TAX
HOTEL
SCHERTZ
INCREMENT
OCCUPANCY
DEVELOPMENT
TOTALS
FINANCING
TAX
FORESTRY
FOUNDATION
1996
1995
REVENUES
other
Donations
$ -
$ -
$ -
$ 9,704
$ 9,704
$ 6,050
Tax Revenue
1,687
3,372
-
-
5,059
-
Sale of Land
-
-
-
-
-
34,002
Interest
-
-
39
1,804
1,843
1,722
Total Revenues
$1,687
$3,372
39
$11,508
$16,606
$41,774
EXPENDITURES
General and
Administrative
$ -
$ -
$ -
$ 5,367
$ 5,367
$ -
Contractual Services
-
-
-
205
205
11,169
Supplies /Maintenance
-
-
-
-
-
20,278
Infrastructure
-
-
-
5,000
5,000
-
Total Expenditures
$ -0-
$ _0_
$_0_
$10,572
$10,572
$13,447
Excess of Revenues
Over Expenditures
$1,687
$3,372
$ 39
$ 936
$ 6,034
$28,327
FUND BALANCES - OCTOBER 1
-
-
56
48,496
48,552
20,225
FUND BALANCES -
SEPTEMBER 30
$1,687
$3,372
95
$49,432
$54,586
$48,552
(See Accompanying Notes to Financial Statements)
49
(This Page Intentionally Left Blank)
50
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.
51
CITY OF SCHERTZ, TEXAS
DEBT SERVICE FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 1996 AND 1995
ASSETS
SEPTEMBER 30,
1996 1995
Cash and Cash Equivalents $235,013 $ 34,271
Delinquent Taxes Receivable (Net of Allowances) 14,512 13,916
Investments 104,866
TOTAL ASSETS $249,525 $153,053
LIABILITIES AND FUND BALANCES
LIABILITIES
Due to Other Funds $269,360 $124,137
Deferred Revenue
Ad Valorem Taxes 14,512 13,916
Total Liabilities $283,872 $138,053
FUND BALANCES (DEFICIT)
Reserved for Debt Service (34,347) '15,000
TOTAL LIABILITIES AND FUND BALANCE $249,525 $153,053
(See Accompanying Notes to Financial Statements)
52
CITY OF SCHERTZ, TEXAS
DEBT SERVICE FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
YEAR ENDED SEPTEMBER 30, 1996
REVENUES
Interest Income
EXPENDITURES
Debt Service
Bond Principal
Bond Interest
Bond Issue Costs
Fiscal Agent Fees
Total Expenditures
Excess of Revenues Over
(Under) Expenditures
OTHER FINANCING SOURCES (USES)
Operating Transfers In
Proceeds from Bond Issue
Total Other Financing
Sources (Uses)
Excess of Revenues
(Deficiency) and Other
Financing Sources Over
(Under) Expenditures and
Other Financing Uses
FUND BALANCES - OCTOBER 1
FUND BALANCES (DEFICIT) -
SEPTEMBER 30
1996
VARIANCE
FAVORABLE 1995
BUDGET ACTUAL (UNFAVORABLE) ACTUAL
$ -0- $ 1,794 $ 1,794 $ 6,594
$ 128,150 $ 656,000 $(527,850) $ 165,000
96,462 177,461 (80,999) 129,255
- 46,016 (46,016) -
- 2,534 (2,534) 2,090
$ 224,612 $ 882,011 $(657,399) $ 296,345
$(224,612) $(880,217) $(655,605) $(289,751)
$ 224,612 $ 383,870
- 447,000
$ 224,612 $ 830,870
$ 159,258
447,000
$ 606,258
$ -0- $ (49,347) $$ (449)
15,000
$ ($ (3)
(See Accompanying Notes to Financial Statements)
53
$ 242,879
$ 242,879
$ (46,872)
61,872
$$ 15,000
(This Page Intentionally Left Blank)
54
CAPITAL PROJECTS FUNDS
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.)
6161
(This Page Intentionally Left Blank)
56
CITY OF SCHERTZ, TEXAS
CAPITAL PROJECTS FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 1996 AND 1995
ASSETS
Cash and Cash Equivalents
Accounts Receivable
Accrued Interest
Due from Other Funds
TOTAL ASSETS
LIABILITIES AND FUND BALANCES
LIABILITIES
Due to Other Funds
Accounts Payable
Total Liabilities
FUND BALANCES
Unreserved - Designated for
Capital Improvements
TOTAL LIABILITIES AND
FUND BALANCES
TOTALS
1996 1995
$ 719,889 $ 674,261
- 80,356
376,668 292,154
$1,096,557 $1,046,771
$ 571,516 $ 494,840
56,186
$ 571,516 $ 551,026
525,041 495,745
$1,096,557 $1,046,771
(See Accompanying Notes to Financial Statements)
57
CITY OF SCHERTZ, TEXAS
CAPITAL PROJECTS FUND
COMPARATIVE STATEMENTS OF REVENUE, EXPENDITURES, AND CHANGES IN FUND BALANCES
YEARS ENDED SEPTEMBER 30, 1996 AND 1995
REVENUES
Other
Federal Financial Assistance
Interest Income
Other
Total Revenues
EXPENDITURES
Capital Outlay
Excess (Deficiency) of Revenues
Over (Under) Expenditures
FUND BALANCES - BEGINNING OF YEAR
FUND BALANCES - END OF YEAR
TOTALS
1996 1995
$ 36,765
26,678
$ 63,443
$ 110,713
33,246
1,660
$ 145,619
34,147 750,180
$ 29,296 $ (604,561)
495,745 1,100,306
$525,041 S - 495,745
(See Accompanying Notes to Financial Statements)
58
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.
59
CITY OF SCHERTZ, TEXAS
ENTERPRISE FUNDS
COMBINING BALANCE SHEET
SEPTEMBER 30, 1996
(WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1995)
RESTRICTED ASSETS
Cash and Cash
Equivalents
FIXED ASSETS
Land and Improvements
Buildings
Improvements Other
than Buildings
Machinery, Equipment,
and Vehicles
Construction in
Progress
Totals
Less: Accumulated
Depreciation
Total Fixed Assets
OTHER ASSETS
Organizational Costs
(Net of Accumulated
Amortization of $1,233
and $1,185 for 1996
and 1995)
Bond Issue Costs
(Net of Accumulated
Amortization of $12,479
and $ -0- for 1996 and
1995)
Total Other Assets
TOTAL ASSETS
$ 840,754 $ -0- $ 840,754 $ 840,253
$ 160,521 $ - $ 160,521 $ 160,521
195,724 26,656 222,380 222,380
9,505,982 - 9,505,982 8,879,069
615,046 470,158 1,085,204 969,221
100,490 100,490 341,125
$10,577,763 $496,814 $11,074,577 $10,572,316
5,308,340 297,754 5,606,094 5,177,400
$ 5,269,423 $199,060 $ 5,468,483 $-5,394,916
$ 667 $ - $ 667 $ 715
116,506 - 116,506 -
$ 117,173 $ -0- $ 117,173 $ 715
$ 9,204,267 $644,067 $ 9,848,334 $ 8,309,816
(See Accompanying Notes to Financial Statements)
60
WATER AND
SEWER
TOTALS'
SYSTEM
SAFES
1996
1995
ASSETS
CURRENT ASSETS
Cash and Cash
Equivalents
$ 921,707
$359,896
$1,281,603
$ 698,963
Investments
601,663
-
601,663
-
Accounts Receivable
(Net)
325,497
63,650
389,147
412,898
Due from Other Funds
1,061,091
1,911
1,063,002
868,360
Inventory of Supplies,
at Cost
66,959
19,550
86,509
93,711
Total Current
Assets
$ 2,976,917
$445,007
$3,421,924
$ 2,073,932
RESTRICTED ASSETS
Cash and Cash
Equivalents
FIXED ASSETS
Land and Improvements
Buildings
Improvements Other
than Buildings
Machinery, Equipment,
and Vehicles
Construction in
Progress
Totals
Less: Accumulated
Depreciation
Total Fixed Assets
OTHER ASSETS
Organizational Costs
(Net of Accumulated
Amortization of $1,233
and $1,185 for 1996
and 1995)
Bond Issue Costs
(Net of Accumulated
Amortization of $12,479
and $ -0- for 1996 and
1995)
Total Other Assets
TOTAL ASSETS
$ 840,754 $ -0- $ 840,754 $ 840,253
$ 160,521 $ - $ 160,521 $ 160,521
195,724 26,656 222,380 222,380
9,505,982 - 9,505,982 8,879,069
615,046 470,158 1,085,204 969,221
100,490 100,490 341,125
$10,577,763 $496,814 $11,074,577 $10,572,316
5,308,340 297,754 5,606,094 5,177,400
$ 5,269,423 $199,060 $ 5,468,483 $-5,394,916
$ 667 $ - $ 667 $ 715
116,506 - 116,506 -
$ 117,173 $ -0- $ 117,173 $ 715
$ 9,204,267 $644,067 $ 9,848,334 $ 8,309,816
(See Accompanying Notes to Financial Statements)
60
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Vouchers Payable
Note Payable
Due to Other Funds
Accrued Vacation and
Sick Leave
Total Current
Liabilities
CURRENT LIABILITIES PAYABLE
FROM RESTRICTED ASSETS
Customer Deposits
Revenue Bonds
Certificates of
Obligation
Refunding Bonds
Public Facility Loan
Accrued Interest
Total Current
Liabilities
Payable from
Restricted Assets
NONCURRENT LIABILITIES
Revenue Bonds Payable
(Less Current
Maturities)
Certificate of
Obligation Payable
(Less Current Maturities)
Refunding Bonds (Less
Current Maturities)
Public Facility Loan
Note Payable (Less
Current Maturities)
Total Noncurrent
Liabilities
Total Liabilities
EQUITY
Contributed Capital
Retained Earnings
Reserved for Revenue
Bond Retirement
Reserved for Equipment
Replacement and Capital
Improvements
Unreserved
Total Equity
TOTAL LIABILITIES AND EQUITY
WATER AND
SEWER
SYSTEM SAFES
$ 211,339 $ 7,222
23,899 -
1,459,375 70,611
23,936 6,027
$1,718,549 $ 83,860
$ 143,815 $ -
55,000 -
95,000 -
82,000 -
4,000 -
41,764 -
TOTALS
1996 1995
$ 218,561
23,.899
1,529,986
29,963
$1,802,409
$ 143,815
55,000
95,000
82,000
4,000
41,764
$ 96,755
52,218
788,505
26,162
$ 963,640
$ 119,685
100,000
100,000
4,000
44,343
$ 421,579 $ -0- $ 421,579 $ 368,028
$ 955,000 $ - $ 955,000 $1,355,000
160,000 - 160,000 880,000
1,080,000 - 1,080,000 -
76,000 - 76,000 80,000
149,920 149,920 .173,819
$2,420,920 $ -0- $2,420,920 $2,488,819
$4,561,048 $ 83,860 $4,644,908 $3,820,487
$3,787,088 $226,769 $4,013,857 $3,776,949
382,368 - 382,368 382,368
40,000 - 40,000 40,000
433,763 333,438 767,201 290,012
$4,643,219 $560,207 $5,203,426 $4,489,329
$9,204,267 $644,067 $9,8� 4 $8,3� 09
61
CITY OF SCHERTZ, TEXAS
ENTERPRISE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN RETAINED EARNINGS
YEAR ENDED SEPTEMBER 30, 1996
(WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1995)
OPERATING REVENUES
Fees Charged to Users
Reimbursements and Other
Total Operating Revenues
OPERATING EXPENSES BEFORE
DEPRECIATION
Personal Services
Sewage Treatment
General and Administrative
Contractual Services
Supplies /Maintenance
Bad Debts
Total Operating Expenses
before Depreciation
Operating Income before
Depreciation and Amortization
Depreciation and Amortization
Operating Income
NONOPERATING REVENUES (EXPENSES)
Interest Income
Interest Expenses
Total Nonoperating Revenues
(Expenses)
Net Income before Other
Financing Sources (Uses)
OTHER FINANCING SOURCES (USES)
Transfers Out
Net Income
RETAINED EARNINGS AT BEGINNING
OF YEAR
RETAINED EARNINGS
AT END OF YEAR
WATER AND TOTALS
SEWER SYSTEM SAFES 1996 1995
$2,347,003 $585,639 $2,932,642 $2,517,892
43,597 43,597 45.026
$2,390,600 $585,639 $2,976,239 $2,562,918
$ 360,289 $240,981 $ 601,270 $ 561,845
414,065 - 414,065 411,336
225,000 2,600 227,600 229,800
206,938 75,774 282,712 215,337
117,257 111,450 228,707 241,711
2.247 76.175 78,422 69,853
$1,325,796 $506,980 $1,832,776 $1,729,882
$1,064,804 $ 78,659 $1,143,463 $ 833,036
397,619 41.069 438.688 409,041
$ 667,185 $ 37,590 $ 704,775 $ 423,995
$ 106,348 $ 16,884
(188,837) (2,723)
$ (82,489) $ 14,161
$ 584,696 $ 51,751
(159,258) -
$ 425,438 $ 51,751
$ 123,232 $ 93,416
(191,560) (224,648)
$ (68,328) $ (131.232)
$ 636,447 $ 292,763
(159,258) -
$ 477,189 $ 292,763
430.693 281,687 712,380 419,617
$ 856,131 $333.438 $1,1,569 $ 7� 1 0
(See Accompanying Notes to Financial Statements)
62
CITY OF SCHERTZ, TEXAS
ENTERPRISE FUNDS
COMBINING STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES
YEAR ENDED SEPTEMBER 30, 1996
(WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1995)
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 from
Reimbursements and Other
Net Cash Provided by
Operating Activities
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Operating Transfers out
to Other Funds
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
Acquisition and Construction
of Capital Assets
Bond Issue Costs
Principal Payments on
Long -Term Debt
Proceeds from Issuance of
Long -Term Debt
Interest Paid on Long -Term
Debt
Capital Contributed for
Capital Assets
Net Cash Used in Capital
and Related Financing
Activities
CASH FLOWS FROM INVESTING
ACTIVITIES
Purchase of Investment
Interest on Investments
Net Cash Provided by
(Used in) Investing
Activities
Net Increase in Cash
CASH AND CASH EQUIVALENTS -
BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS -
END OF YEAR
Comprised of
Current Assets
Restricted Assets
CASH AND CASH EQUIVALENTS
END OF YEAR
WATER AND
-
TOTALS
SEWER SYSTEM
SAFES
1996
1995
(239,619)
1,253,000
$2,189,156
$572,595
$2,761,751
$2,240,947
(96,632)
(237,953)
(334,585)
(1,168,425)
(356,488)
(240,981)
(597,469)
(559,001)
43,597
-
43,597
45,026
$1,779,633
$ 93,661
$1,873,294
$ 558,547
$ (159,258) $ -0- $ (159,258) $ -
$ (456,896) $(45,134) $ (502,030) $ (203,745)
(128,985)
-
(128,985)
-
(1,287,198)
(30,020)
(1,317,218)
(239,619)
1,253,000
-
1,253,000
30,020
(191,416)
(2,723)
(194,139)
(228,402)
236,908
236,908
10,125
$ (574,587)
$(77,877)
$ (652,464)
$ (631,621)
$ (601,663)
$ -
$ (601,663)
$ -
106,348
16,884
123,232
93,567
$ (495,315) $ 16,884 $ (478,431) $ 93,567
$ 550,473 $ 32,668 $ 583,141 $ 20,493
1,211,988
$1,762,461
$ 921,707
840,754
$1,762,461
(See Accompanying Notes to Financial Statements)
63
327,228 1,539,216 1,518,723
$359,896 $2,122,357 $1,539,216
$359,896 $1,281,603 $ 698,963
- 840,754 840,253
$359,896 $2,122,357 $1,539,216
(Continued)
CITY OF SCHERTZ, TEXAS
ENTERPRISE FUND
COMBINING STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES
YEAR ENDED SEPTEMBER 30. 1996
WATER AND TOTALS
SEWER SYSTEM SAFES 1996 1995
RECONCILIATION OF OPERATING
INCOME (LOSS) TO NET CASH
PROVIDED BY OPERATING
INCOME
Operating Income (Loss)
Adjustments to Reconcile
Operating Income (Loss)
to Net Cash Provided by
Operating Activities
Depreciation /Amortization
Provision for Uncollectible
Accounts
Change in Assets and Liabilities
(Increase) Decrease in
Accounts Receivable
(Increase) Decrease in Inventory
(Increase) Decrease in
Due from Other Funds
Increase (Decrease) in
Vouchers Payable
Increase (Decrease) in
Due to Other Funds
Increase (Decrease) in
Accrued Vacation
Increase (Decrease) in Accrued
Interest Payable
Increase (Decrease) in
Customers Deposits
NET CASH PROVIDED BY
OPERATING ACTIVITIES
Supplemental Disclosures
Non -Cash Capital and Related
Financing Transactions
Acquisition and Construction
of Capital Assets
Bonds Issued
Note Payable Issued
Federal Financial Assistance
Contributed Capital
$ 667,185 $ 37,590 $ 704,775 $292,763
400,152
41,069
441,221
409,041
2,247
76,175
78,422
69,853
33,516
(88,187)
(54,671)
(61,627)
5,493
1,709
7,202
25,137
(193,610)
(1,032)
(194,642)
(760,397)
118,878
2,697
121,575
6,276
717,841
23,640
741,481
578,265
3,801
-
3,801
2,844
-
-
-
(3,754)
24,130
24,130
146
$1,7779 S 93,661 $1,873,294 $$ 558,547
$ 456,896 $ 45,134 $ 502,030 $203,745
1,253,000 - 1,253,000 -
- - - 30,020
160,511 - 160,511 -
236,908 - 236,908 10,125
64
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.
65
(This Page Intentionally Left Blank)
66
CITY OF SCHERTZ, TEXAS
SCHEDULES OF GENERAL FIXED ASSETS - BY SOURCE
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
67
SEPTEMBER 30,
1996 1995
$ 423,4.60 $ 423,460
1,114,290 1,114,290
7,956,342 7,922,195
1,092,935 740,652
1,134,239 1,027,942
$11,721,266 $11,228,539
$ 2,526,393 $ 2,073,598
1,317,990 1,317,990
182,686
182,686
317,005
317,005
113,614
113,614
180,984
146,837
7,066,305
7,066,305
10,504
10,504
5,785
$11,721,266 $11,228,539
CITY OF SCHERTZ, TEXAS
SCHEDULES OF GENERAL FIXED ASSETS - BY FUNCTION AND ACTIVITY
YEAR ENDED SEPTEMBER 30, 1996
BALANCE BALANCE
OCTOBER 1, SEPTEMBER 30,
1995 ADDITIONS DEDUCTIONS 1996
General Government $ 926,042 $ 6,310 $ - $ 932,352
Public Safety
Police
373,279
200,215
- 573,494
Fire
644,074
184,863
- 828,937
Inspection
24,055
900
- 24,955
Street and Park
Street
7,530,655
55,647
- 7,586,302
Pool
541,773
1,527
- 543,300
Parks
685,252
2,730
- 687,982
Health
Animal Control
223,948
8,760
- 232,708
Library
268,957
31,775
- 300,732
Development Foundation
10,504
-
- 10,504
TOTALS
$11,228,539
$492.727
$ $11.721,266
68
COMPONENTS OF GENERAL FIXED ASSETS
IMPROVEMENTS
OTHER THAN
LAND BUILDINGS BUILDINGS VEHICLES EQUIPMENT
$ 63,769 $ 623,236 $ 48,310 $ 6,676 $ 190,361
- - -
418,408
155,086
12,000 65,000 5,670
479,985
266,282
- - 139
18,031
6,785
108,333 400 7,068,867
145,109
263,593
- - 530,309
-
12,991
182,662 195,159 202,906
17,998
89,257
23,161 106,071 65,274 6,728 37,259
23,031 124,424 34,867 - 112,625
10,504
$423,460 $1,114,290 $7,956,342 $1.092.935 $1,134,239
69
(This Page Intentionally Left Blank)
70
STATISTICAL INFORMATION
71
CITY OF SCHERTZ, TEXAS
GENERAL GOVERNMENTAL EXPENDITURES BY FUNCTION TABLE 1
FISCAL
GENERAL
PUBLIC
STREETS
TOTAL (1)
YEAR
GOVERNMENT
SAFETY
AND PARKS
HEALTH
OTHER
EXPENDITURES
1987
$715,242
$488,536
$318,719
$55,657
$188,193
$1,766,347
1988
807,754
523,000
283,323
47,507
216,662
1,878,246
1989
934,517
582,673
289,539
50,243
189,199
2,046,171
1990
654,009
796,823
327,797
56,150
339,241
2,174,020
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
2,34,4,541
1993
741,305
924,222
373,213
75,441
479,836
2,594,017
1994
744,801
978,121
305,633
80,494
647,556
2,756,605
1995
813,789
1,059,331
349,659
80,324
633,842
2,936,945
1996
886,090
1,174,371
304,722
85,685
1,510,303
3,961,171
(1) Includes General, Special Revenue
and Debt Service Funds
72
CITY OF SCHERTZ, TEXAS
GENERAL GOVERNMENT REVENUES BY SOURCE TABLE 2
*Includes General, Special Revenue
and Debt Service Funds
* *Reclassification Among These Categories
Performed in 1991
73
LICENSES
CHARGES
FINES
FISCAL
AND
FOR
AND
YEAR
TAXES
PERMITS
SERVICES
FORFEITURES
OTHER
TOTAL*
1987
$1,152,108
$76,821
$32,459
$159,837
$203,837
$1,625,062
1988
1,308,600
54,627
32,391
139,008
272,230
1,806,856
1989
1,360,611
53,045
31,235
145,830
305,348
1,896,069
1990
1,540,027
42,194
72,781
217,311
305,977
2,178,290
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
2,526,5'58
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
2,384,706
394,841
375,767
317,403
249,697
3,722,414
*Includes General, Special Revenue
and Debt Service Funds
* *Reclassification Among These Categories
Performed in 1991
73
(This Page Intentionally Left Blank)
74
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FF-1
CITY OF SCHERTZ, TEXAS
ASSESSED AND ESTIMATED ACTUAL VALUE OF PROPERTY TABLE 4
77
FISCAL
ESTIMATED
LEVY
YEAR
ACTUAL
ASSESSMENT
ASSESSED
TAX
TAX
YEAR
ENDED
VALUES
PERCENTAGE
VALUATIONS
RATE
LEVY
1987
09 -30 -87
$153,457,116
100%
$147,961,601
.4128%
$ 610,784
1988
09 -30 -88
379,674,429
100
285,978,200
.24705
706,369
1989
09 -30 -89
284,253,725
100
290,606,339
.2576
748,602
1990
09 -30 -90
376,676,293
100
287,272,356
.3183
914,388
1991
09 -30 -91
340,903,727
100
272,593,690
.3689
1,005,598
1992
09 -30 -92
269,351,284
100
268,170,123
.3889
1,042,914
1993
09 -30 -93
256,861,608
100
259,038,486
.4255
1,102,209
1994
09 -30 -94
264,286,116
100
258,766,426
.4684
1,212,063
1995
09 -30 -95
362,247,758
100
312,676,505
.4275
1,337,010
1996
09 -30 -96
346,130,091
100
334,122,763
.4072
1,360,548
77
CITY OF SCHERTZ, TEXAS
PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS TABLE 5
*All rates shown are per $100 assessed valuation.
* *Year shown is the fiscal year of collection. Taxes
were levied the previous calendar year.
78
COUNTY
YEAR **
CITY
SCHOOL
COUNTY
ROAD
100%
100%
100%
100%
ASSESSMENT
ASSESSMENT
ASSESSMENT
ASSESSMENT
RATE*
RATE*
RATE
RATE
1987
.4128 %
1.14 %
.3875%
.04 %
1988
.24705
.783
.2852
.0820
1989
.2576
.8882
.1522
.0950
1990
.3183
1.00561
.1418
.0977
1991
.3689
1.20513
.2720
.0850
1992
.3889
1.4777
.3599
.0850
1993
.4255
1.4499
.3036
.0950
1994
.4684
1.3095
.2995
.0867
1995
.4275
1.3712
.3018
.0833
1996
.4072
1.4089
.2997
.0758
*All rates shown are per $100 assessed valuation.
* *Year shown is the fiscal year of collection. Taxes
were levied the previous calendar year.
78
CITY OF SCHERTZ, TEXAS
RATIO OF NET GENERAL OBLIGATION BONDED DEBT
TO ASSESSED VALUE AND NET GENERAL BONDED DEBT PER CAPITA TABLE 6
*Based on Preliminary 1990 Census. This estimate has
been challenged by the City.
* *Includes General Bonded Debt Issued During Current Year
79
NET
RATIO
GENERAL
OF NET
BONDED
BONDED DEBT
DEBT PER
FISCAL
YEAR
ESTIMATED
ASSESSED
NET GENERAL
TO ASSESSED
CAPITA
September
30,
1987
12,500
$147,961,601
$757,798
.51.
$60.62
September
30,
1988
12,580
285,978,200
758,401
.27
60.29
September
30,
1989
12,580
290,606,339
755,115
.26
60.03
September
30,
1990
10,681*
287,272,356
732,510
.25
68.58
September
30,
1991
10,900
272,593,690
7150,300
.26
65.62
September
30,
1992
11,500
268,170,123
687015
.26
59.80
September
30,
1993
12,000
259,038,486
"1,190,649 **
.46
99.22
September
30,
1994
12,500
258,766,426
1,132,128
.43
90.57
September
30,
1995
13,500
312,676,505
1,056,611
.34
78.27
September
30,
1996
14,500
334,122,763
1,215,000
.36
83.79
*Based on Preliminary 1990 Census. This estimate has
been challenged by the City.
* *Includes General Bonded Debt Issued During Current Year
79
CITY OF SCHERTZ, TEXAS
COMPUTATION OF DIRECT AND OVERLAPPING DEBT
YEAR ENDED SEPTEMBER 30, 1996
*Bezar County
*Comal County
*Comal Independent School District
*Guadalupe County
*Schertz- Cibolo- Universal
City Independent School District
*San Antonio River Authority
*Alamo Community College District
Total Net Overlapping Debt
*City of Schertz
TOTAL DIRECT AND OVERLAPPING DEBT
(2.56% OF ASSESSED VALUE -
$800.75 PER CAPITA)
TABLE 7
*Source of Data - Texas Municipal Reports,
City of Schertz, 1995 (Latest Available)
Compiled and Published by Municipal
Advisory Council of Texas
11,959,146 04 -01 -95
65,640,000 06 -30 -95
69,595,000 08 -31 -95
51.88 6,204,405
.02 13,128
.02 13,919
$6,604,599
1,847,362 07 -31 -95 100.00 1,847,362
80
$8,4
NET DEBT
PERCENT
AMOUNT
AS OF
OVER-
OVER -
AMOUNT
08 -31 -95
LAPPING
LAPPING
$171,035,609
04 -30 -95
.02%
$ 34,207
4,987,238
12 -31 -94
.09
4,489
34,174,689
08 -31 -95
.12
41,010
1,989,431
09 -30 -94
14.75
293,441
*Source of Data - Texas Municipal Reports,
City of Schertz, 1995 (Latest Available)
Compiled and Published by Municipal
Advisory Council of Texas
11,959,146 04 -01 -95
65,640,000 06 -30 -95
69,595,000 08 -31 -95
51.88 6,204,405
.02 13,128
.02 13,919
$6,604,599
1,847,362 07 -31 -95 100.00 1,847,362
80
$8,4
CITY OF SCHERTZ, TEXAS
LEGAL DEBT MARGIN
YEAR ENDED SEPTEMBER 30, 1996 TABLE 8
Texas municipalities are not bound by any 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 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.
81
(This Page Intentionally Left Blank)
82
CITY OF SCHERT2, TEXAS
RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR
GENERAL OBLIGATION BONDED DEBT TO TOTAL GENERAL EXPENDITURES
LAST TEN FISCAL YEARS TABLE 9
*Includes General, Special Revenue, and Debt Service Funds
83
PERCENT
OF DEBT
DEBT
SERVICE TO
SERVICE
GENERAL
FISCAL
YEAR
PRINCIPAL
INTEREST
TOTAL
EXPENDITURES*
EXPENDITURES
September
30,
1987
$22,000
$25,169
$47,169
$1,766,347
2.7%
September
30,
1988
24,000
72,900
96,900
1,878,246
5.2
September
30,
1989
39,000
54,758
93,758
2,046,171
4.3
September
30,
1990
45,000
52,049
97,049
2,174,020
4.5
September
30,
1991
45,000
49,067
94,067
2,341,055
4.0
September
30,
1992
46,000
46,084
92,084
2,344,541
4.0
September
30,
1993
57,000
42,830
99,830
2,594,017
3.9
September
30,
1994
58,000
97,493
15501493
2,756,605
5.6
September
30,
1995
85,000
74,139
159,139
2,936,945
5.4
September
30,
1996
341,000
87,098
428,098
3,961,171
10.81
*Includes General, Special Revenue, and Debt Service Funds
83
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CITY OF SCHERTZ, TEXAS
WATERWORKS AND SEWER SYSTEM FUND
REVENUE BOND REQUIREMENTS AND RESTRICTED FUNDS
YEAR ENDED SEPTEMBER 30, 1996
UTILITY SYSTEM REVENUE BONDS, SERIES 1973:
Principal Payment, Due September 1, 1997
Interest Payment, Due March 1, 1997
UTILITY SYSTEM REVENUE BONDS, SERIES 1987:
Principal Payment, Due September 1, 1997
Interest Payment, Due March 1, 1997
Total Requirements
CASH - RESTRICTED
UNDER REQUIREMENTS
RESERVE FUND REQUIREMENT
ANNUAL
PRINCIPAL/
SEMI - ANNUAL
INTEREST
$ 40,000
3,664
15,000
31,625
TABLE 11
REQUIREMENT
AT
SEPTEMBER 30,
BASIS 1996
1 /12th $ 3,333
1 /6th 611
1 /12th 1,250
1 /6th 5,271
$10,465
7,391
$0,074)
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, 1996 met these requirements.
1 'h Time Average Annual Principal and Interest
Requirement (Annual $136,937)
Cash and Investments
FUNDS AVAILABLE OVER (UNDER) REQUIREMENT
85
$205,406
342,238
$136
(This Page Intentionally Left Blank)
86
CITY OF SCHERTZ, TEXAS
DEMOGRAPHIC STATISTICS
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
(4) Schertz - Cibolo- Universal City Independent School District
87
LAST TEN
FISCAL YEARS
TABLE 12
LEVEL IN
a.
f.
PER
YEARS OF
CAPITA
MEDIAN
FORMAL
SCHOOL
UNEMPLOYMENT
FISCAL
POPULATION
INCOME
AGE
EDUCATION
ENROLLMENT
RATE IN %
YEAR
(1)
(2)
(3)
(3)
(4)
(3)
1987
12,500
Est.
$ -
41
12
2,306
5.7%
1988
12,580
Est.
8,300
41
12
2,334
6.2
1989
12,580
Est.
8,300
41
12
3,980
7.3
1990
10,597
Act.
9,600
42
12
4,175
.4.6
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
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
(4) Schertz - Cibolo- Universal City Independent School District
87
(This Page Intentionally Left Blank)
88
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CITY OF SCHERTZ, TEXAS
PRINCIPAL TAXPAYERS
YEAR ENDED SEPTEMBER 30, 1996
TABLE 14
90
1995
PERCENTAGE OF
ASSESSED
TOTAL ASSESSED
PRINCIPAL TAXPAYERS
TYPE OF BUSINESS
VALUATION
VALUATION
1.
Eric W. White
Real Estate
$ 5,717,248
20.34%
2.
Negley Paint Co., Inc.
Industrial
3,599,250
12.80
3.
Sycamore Creek Partners
Apartments
3,359,231
11.95
4.
PSPI, Inc.
Machine Fabricating
3,110,173
11.06
5.
Garden Ridge Pottery
Mercantile-
3,059,174
10.88
6.
American Freightways Corp.
Transportation
2,897,949
10.32
7.
Guadalupe Valley Electric
Utility
2,152,230
7.66
8.
Southwestern Bell
Telephone Co.
Telephone Utility
1,563,560
5.56
9.
Beck Readymiz Concrete Co.
Manufacturing
1,341,425
4.77
10.
UPADHYAYA, Inc.
Motel
1,309,789
4.66
TOTAL (8.46% OF 1995
ASSESSED VALUATION)
$28,110,029
100.00%
90
CITY OF SCHERTZ, TEXAS
MISCELLANEOUS STATISTICS
YEAR ENDED SEPTEMBER 30, 1996
Date of Incorporation:
Date First Charter Adopted:
Date Present Charter Adopted:
Form of Government:
YEAR
1996
1995
1994
1993
1992
1991
1990
1989
1988
1987
Miles of Highways, Streets and Alleys
Streets and Highways, Paved
Streets, Unpaved
Alleys
Sidewalks
Miles of Sewer:
Storm
Sanitary
Building Permits:
TABLE 15
December, 1958
April, 1974
Amended March, 1989
Council - Manager
SQUARE MILES
24.15
24.15
24.15
24.15
24.15
23.75
23.75
22.42
22.42
22.38
93.69 Miles
6.78 Miles
3.44 Miles
15.09 Miles
2.18 Miles
41.04 Miles
(Continued)
91
VALUE OF
YEAR
PERMITS ISSUED
BUILDINGS
1996
2,559
$64,267,503
1995
2,066
21,150,682
1994
2,771
18,917,416
1993
2,167
25,705,848
1992
873
6,702,823
1991
545
7,667,699
1990
392
6,652,769
1989
407
6,762,584
1988
368
7,752,335
1987
430
9,725,569
(Continued)
91
CITY OF SCHERTZ, TEXAS
MISCELLANEOUS STATISTICS
YEAR ENDED SEPTEMBER 30, 1996
Fire Protection:
Number of Stations
Number of Employees (Full and Part -Time)
Number of Volunteers
Recreation:
Parks
Playgrounds
Other Recreational Facilities:
Baseball Fields
Softball Fields
Large Pavilion
Small Pavilion
Picnic Tables:
Unpovered
Restrooms:
Male
Female
Concessions Stands
Community Center
City Employees:
September 30, 1996
Elections:
Number of Registered Voters
Number of Votes in:
Last Municipal Election
Percentage of Registered Voters Voting in:
Last Municipal Election
Source: Municipal Election Records
Population:
Census Population Count
1996 (Estimate)
1990
1980
1970
1960
1950
1940
��l
TABLE 15
1
17
30
7
65
3
2
10,000 Square Feet Covered
600 Square Feet Covered
50
6
6
1
1
157
7,343
945
13.0%
14,500
10,597
7,260
4,061
2,281
1,200
600
SINGLE AUDIT REPORTS
93
(This Page Intentionally Left Blank)
94
NORTH TOWER
800 N.W. LOOP 410, SUITE 5WN
SAN ANTONIO, TEXAS 78216.5611
210/341 -2581
FAX 210/341.2588
The Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Thompson,
Williams,
Biediger,
Kastor
T
Young,
LC.
CERTIFIED PUBLIC ACCOUNTANTS
MEMBERS AMERICAN INSTITUTE OF
CERTIFIED PUBLIC ACCOUNTANTS
Independent Auditor's Report
on Schedule of Federal Financial Assistance
We have audited the general purpose financial statements of the City of Schertz,
Texas, as of and for the year ended September 30, 1996, and have issued our report
thereon dated April 11, 1997. 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 statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards
and Government Auditing Standards, issued by the Comptroller General of the United
States and the provisions of Office of Managemefit and Budget (OMB) Circular A -128,
Audits of State and Local Governments. Those standards and OMB Circular A -128 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.
Our audit was conducted for the purpose of forming an opinion on the general
purpose financial statements of the City of Schertz, Texas, taken as a whole. The
accompanying Schedule of Federal Financial Assistance is presented for purposes of
additional analysis and is not a required part of the general purpose financial
statements. The information in this schedule has been subjected to the auditing
procedures applied in the audit of the general purpose financial statements and, in our
opinion, is fairly presented in all material respects in relation to the general
purpose financial statements taken as a whole.
Certified Public Accountants
San Antonio, Texas
April 11, 1997
R. LARRY THOMPSON, C.P.A. / PAUL E. WILLIAMS. C.P.A. / JAMES L. BIEDIGER, JR., C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG, JR., C.P.A.
JOHN LEIF, C.P.A. / H. LEE SCHWARTZMAN, C.P.A. / F GLENN CRAVEY C.P.A. / FRED J. TIMMONS, C.P.A. / JOHN W. GREEN. C.P.A.
JAMES T. McCARTY, C.P.A. (RETIRED)
95
(This Page Intentionally Left Blank)
96
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CITY OF SCHERTZ, TEXAS
NOTES TO SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
YEAR ENDED SEPTEMBER 30, 1996
1. GENERAL
The accompanying Schedule of Federal Financial Assistance presents the activity
of all federal financial assistance programs of the City of Schertz, Texas. The
City of Schertz, Texas, reporting entity is` defined in Note 1 to the City's
general purpose financial statements. All federal financial assistance passed
through other government agencies are included on the schedule.
2. BASIS OF ACCOUNTING
The accompanying Schedule of Federal Financial Assistance is presented using the
modified accrual basis of accounting, which is described in Note 1 to the City's
general purpose financial statements.
3. RECONCILIATION OF FEDERAL FINANCIAL ASSISTANCE
Federal Financial Assistance was received in the following funds:
Water and -Sewer System Fund
Capital Projects Fund
98
The Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Independent Auditor's Report on Internal Control Structure
Based on an Audit of General Purpose Financial Statements
Performed in Accordance with Government Auditing Standards
We have audited the general purpose financial statements of the City of Schertz,
Texas, as of and for the year ended September 30,'1996, and have issued our report
thereon dated April 11, 1997.
We conducted our audit in accordance with generally accepted auditing standards
and 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.
The management of the City of Schertz, Texas, is responsible for establishing and
maintaining an internal control structure. In fulfilling this responsibility,
estimates and judgments by management are required to asses the expected benefits and
related costs of internal control structure policies and procedures. The objectives
of an internal control structure are to provide management with reasonable, but not
absolute, assurance that assets are safeguarded against loss from unauthorized use or
disposition, and that transactions are executed in accordance with management's
authorization and recorded properly to permit the preparation of financial statements
in accordance with generally accepted accounting principles. Because of inherent
limitations in any internal control structure, errors or irregularities may
nevertheless occur and not be detected. Also, projection of any evaluation of the
structure to future periods is subject to the risk that procedures may become
inadequate because of changes in conditions or that the effectiveness of the design and
operation of policies and procedures may deteriorate.
In planning and performing our audit of the general purpose financial statements
of the City of Schertz, Texas, for the year ended September 30, 1996, we obtained an
understanding of the internal control structure. With respect to the internal control
structure, we obtained an understanding of the design of relevant policies and
procedures and whether they have been placed in operation, and we assessed control risk
in order to determine our auditing procedures for the purpose of expressing our opinion
on the general purpose financial statements and not to provide an opinion on the
internal control structure. Accordingly, we do not express such an opinion.
R. LARRY THOMPSON, C.P.A. / PAUL E. WILLIAMS. C.P.A. / JAMES L. BIEDIGER. JR.. C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG, JR., C.P.A.
JOHN LEIF, C.P.A. / H. LEE SCHWARTZMAN, C.P.A. / F GLENN CRAVEY, C.P.A. / FRED J. TIMMONS, C.P.A. / JOHN W. GREEN, C.P.A.
JAMES T. MCCARTY, C.P.A. (RETIRED) 99
Thompson,
Williams,
Biediger,
NORTH TOWER
800 N.W. LOOP 410, SUITE 30ON
Kas tor CERTIFIED PUBLIC ACCOUNTANTS
SAN ANTONIO. TEXAS 78216.5611
210/341.2581
T MEMBERS AMERICAN INSTITUTE OF
FAX 210/341 -2588
Young, CERTIFIED PUBLIC ACCOUNTANTS
L.-C.
The Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Independent Auditor's Report on Internal Control Structure
Based on an Audit of General Purpose Financial Statements
Performed in Accordance with Government Auditing Standards
We have audited the general purpose financial statements of the City of Schertz,
Texas, as of and for the year ended September 30,'1996, and have issued our report
thereon dated April 11, 1997.
We conducted our audit in accordance with generally accepted auditing standards
and 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.
The management of the City of Schertz, Texas, is responsible for establishing and
maintaining an internal control structure. In fulfilling this responsibility,
estimates and judgments by management are required to asses the expected benefits and
related costs of internal control structure policies and procedures. The objectives
of an internal control structure are to provide management with reasonable, but not
absolute, assurance that assets are safeguarded against loss from unauthorized use or
disposition, and that transactions are executed in accordance with management's
authorization and recorded properly to permit the preparation of financial statements
in accordance with generally accepted accounting principles. Because of inherent
limitations in any internal control structure, errors or irregularities may
nevertheless occur and not be detected. Also, projection of any evaluation of the
structure to future periods is subject to the risk that procedures may become
inadequate because of changes in conditions or that the effectiveness of the design and
operation of policies and procedures may deteriorate.
In planning and performing our audit of the general purpose financial statements
of the City of Schertz, Texas, for the year ended September 30, 1996, we obtained an
understanding of the internal control structure. With respect to the internal control
structure, we obtained an understanding of the design of relevant policies and
procedures and whether they have been placed in operation, and we assessed control risk
in order to determine our auditing procedures for the purpose of expressing our opinion
on the general purpose financial statements and not to provide an opinion on the
internal control structure. Accordingly, we do not express such an opinion.
R. LARRY THOMPSON, C.P.A. / PAUL E. WILLIAMS. C.P.A. / JAMES L. BIEDIGER. JR.. C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG, JR., C.P.A.
JOHN LEIF, C.P.A. / H. LEE SCHWARTZMAN, C.P.A. / F GLENN CRAVEY, C.P.A. / FRED J. TIMMONS, C.P.A. / JOHN W. GREEN, C.P.A.
JAMES T. MCCARTY, C.P.A. (RETIRED) 99
(This Page Intentionally Left Blank)
100
Independent Auditorl's Report on Internal Control Structure
Based on an Audit of General Purpose Financial Statements
Performed in Accordance with Government Auditing Standards (Continued)
Reportable conditions involve matters coming to our attention relating to
significant deficiencies in the design or operation of the internal control structure
that, in our judgment, could adversely affect the entity's ability to record, process,
summarize, and report financial statements.
A material weakness is a reportable condition in which the design or operation of
one or more of the specific internal control structure elements does not reduce to a
relatively low level the risk that errors or irregularities 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 structure and its operations that we consider to be material weaknesses as
defined above.
Our consideration of the internal control structure would not necessarily disclose
all matters in the internal control structure that might be material weaknesses as
defined above.
This report is intended for the information of the City of Schertz, Texas,
management and city council. However, this report is a matter of public record, and
its distribution is not limited.
San Antonio, Texas
April 11, 1997
9 Vol
Certified Public Accountants
101
(This Page Intentionally Deft Blank)
102
The Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Independent Auditor's Report on Compliance
Based on an Audit of General Purpose Financial Statements
Performed in Accordance with Government Auditing Standards
We have audited the general purpose financial statements of the City of Schertz,
Texas, as of and for the year ended September 30, 1996, and have issued our report
thereon dated April 11, 1997.
We conducted our audit in accordance with generally accepted auditing standards and
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.
Compliance with laws, regulations, contracts, and grants applicable to the City of
Schertz, Texas, is the responsibility of the City's management. As part of obtaining
reasonable assurance about whether the financial statements are free of material
misstatement, we performed tests of the City's compliance with certain provisions of
laws, regulations, contracts, and grants. However, the objective of our audit of the
general purpose financial statements was not to provide an opinion on overall
compliance with such provisions. 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.
This report is intended for the information of the City of Schertz, Texas'
management and city council. However, this report is a matter of public record and its
distribution is not limited.
Certified Public Accountants
San Antonio, Texas
April 11, 1997
R. LARRY THOMPSON, C.P.A. / PAUL E. WILLIAMS. C.P.A. / JAMES L. BIEDIGER, JR.. C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG, JR., C.P.A.
JOHN LEIF, C.P.A. / H. LEE SCHWARTZMAN, C.P.A. / F. GLENN CRAVEY, C.P.A. / FRED J. TIMMONS, C.P.A. / JOHN W. GREEN, C.P.A.
JAMES T. MCCARTY C.P.A. (RETIRED) 103
Thompson,
Williams,
NORTH TOWER
800 N.W. LOOP 410, SUITE
Biediger,
Kastor CERTIFIED PUBLIC ACCOUNTANTS
3WN
11 VVM1n SAN ANTONIO, TEXAS 78216 -5611
210/341 -2581
FAX 210/341.2588
MEMBERS AMERICAN INSTITUTE OF
Young, CERTIFIED PUBLIC ACCOUNTANTS
L.C.
The Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Independent Auditor's Report on Compliance
Based on an Audit of General Purpose Financial Statements
Performed in Accordance with Government Auditing Standards
We have audited the general purpose financial statements of the City of Schertz,
Texas, as of and for the year ended September 30, 1996, and have issued our report
thereon dated April 11, 1997.
We conducted our audit in accordance with generally accepted auditing standards and
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.
Compliance with laws, regulations, contracts, and grants applicable to the City of
Schertz, Texas, is the responsibility of the City's management. As part of obtaining
reasonable assurance about whether the financial statements are free of material
misstatement, we performed tests of the City's compliance with certain provisions of
laws, regulations, contracts, and grants. However, the objective of our audit of the
general purpose financial statements was not to provide an opinion on overall
compliance with such provisions. 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.
This report is intended for the information of the City of Schertz, Texas'
management and city council. However, this report is a matter of public record and its
distribution is not limited.
Certified Public Accountants
San Antonio, Texas
April 11, 1997
R. LARRY THOMPSON, C.P.A. / PAUL E. WILLIAMS. C.P.A. / JAMES L. BIEDIGER, JR.. C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG, JR., C.P.A.
JOHN LEIF, C.P.A. / H. LEE SCHWARTZMAN, C.P.A. / F. GLENN CRAVEY, C.P.A. / FRED J. TIMMONS, C.P.A. / JOHN W. GREEN, C.P.A.
JAMES T. MCCARTY C.P.A. (RETIRED) 103
(This Page Intentionally Left Blank)
104
The Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Independent Auditor's Report on
Internal Control Structure Used in Administering
Federal Financial Assistance Programs
We have audited tire� general purpose financial statements of City of Schertz, Texas,
as of and for the year ended September 30, 1996, and have issued our report thereon
dated April 11, 1997.
We conducted our audit in accordance with generally accepted auditing standards;
Government Auditing Standards, issued by the Comptroller General of the United States;
and Office of Management and Budget Circular A -128, Audits of State and Local
Governments. Those standards and OMB Circular A -128 require that we plan and perform
the audit to obtain reasonable assurance about whether the general purpose financial
statements are free of material misstatement.
In planning and performing our audit for the year ended September 30, 1996, we
considered the internal control structure of the City of Schertz, Texas, in order to
determine our auditing procedures for the purpose of expressing our opinion on the City
of Schertz, Texas' general purpose financial statements and to report on the internal
control structure in accordance with OMB Circular A -128. This report addresses our
consideration of internal control structure policies and procedures relevant to
compliance with requirements applicable to federal financial assistance programs. We
have addressed internal control structure policies and procedures relevant to our audit
of the general purpose financial statements in a separate report dated April 11, 1997.
The management of City of Schertz, Texas, is responsible for establishing and
maintaining an internal control structure. In fulfilling this responsibility,
estimates and judgments by management are required to assess the expected benefits and
related costs of internal control structure policies and procedures. The objectives
of an internal control structure are to provide management with reasonable, but not
absolute, assurance that assets are safeguarded against loss from unauthorized use or
disposition, that transactions are executed in accordance with management's
authorization and recorded properly to permit the preparation of general purpose
financial statements in accordance with generally accepted accounting principles, and
that federal financial assistance programs are managed in compliance with applicable
laws and regulations. Because of inherent limitations in any internal control
structure, errors, irregularities, or instances of noncompliance may nevertheless occur
R. LARRY THOMPSON. C.P.A. / PAUL E. WILLIAMS, C.P.A. / JAMES L. BIEDIGER, JR., C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG, JR., C.P.A.
JOHN LEIF. C.P.A. / H. LEE SCHWARTZMAN. C.P.A. / F. GLENN CRAVEY, C.P.A. / FRED A TIMMONS, C.P.A. / JOHN W. GREEN. C.P.A.
JAMES T. McCARTY, C.P.A. (RETIRED) 105
Thompson,
Williams,
Biediger,
NORTH TOWER
800 N.W. LOOP 410, SUITE WON
Kastor CERTIFIED PUBLIC ACCOUNTANTS
SAN ANTONIO. TEXAS 78216 -5611
210/341 -2581
FAX 210/341
T MEMBERS AMERICAN INSTITUTE OF
-2588
Young, CERTIFIED PUBLIC ACCOUNTANTS
L.C.
The Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Independent Auditor's Report on
Internal Control Structure Used in Administering
Federal Financial Assistance Programs
We have audited tire� general purpose financial statements of City of Schertz, Texas,
as of and for the year ended September 30, 1996, and have issued our report thereon
dated April 11, 1997.
We conducted our audit in accordance with generally accepted auditing standards;
Government Auditing Standards, issued by the Comptroller General of the United States;
and Office of Management and Budget Circular A -128, Audits of State and Local
Governments. Those standards and OMB Circular A -128 require that we plan and perform
the audit to obtain reasonable assurance about whether the general purpose financial
statements are free of material misstatement.
In planning and performing our audit for the year ended September 30, 1996, we
considered the internal control structure of the City of Schertz, Texas, in order to
determine our auditing procedures for the purpose of expressing our opinion on the City
of Schertz, Texas' general purpose financial statements and to report on the internal
control structure in accordance with OMB Circular A -128. This report addresses our
consideration of internal control structure policies and procedures relevant to
compliance with requirements applicable to federal financial assistance programs. We
have addressed internal control structure policies and procedures relevant to our audit
of the general purpose financial statements in a separate report dated April 11, 1997.
The management of City of Schertz, Texas, is responsible for establishing and
maintaining an internal control structure. In fulfilling this responsibility,
estimates and judgments by management are required to assess the expected benefits and
related costs of internal control structure policies and procedures. The objectives
of an internal control structure are to provide management with reasonable, but not
absolute, assurance that assets are safeguarded against loss from unauthorized use or
disposition, that transactions are executed in accordance with management's
authorization and recorded properly to permit the preparation of general purpose
financial statements in accordance with generally accepted accounting principles, and
that federal financial assistance programs are managed in compliance with applicable
laws and regulations. Because of inherent limitations in any internal control
structure, errors, irregularities, or instances of noncompliance may nevertheless occur
R. LARRY THOMPSON. C.P.A. / PAUL E. WILLIAMS, C.P.A. / JAMES L. BIEDIGER, JR., C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG, JR., C.P.A.
JOHN LEIF. C.P.A. / H. LEE SCHWARTZMAN. C.P.A. / F. GLENN CRAVEY, C.P.A. / FRED A TIMMONS, C.P.A. / JOHN W. GREEN. C.P.A.
JAMES T. McCARTY, C.P.A. (RETIRED) 105
(This Page Intentionally Left Blank)
106
Independent Auditorfs Report on
Internal Control Structure Used in Administering
Federal Financial Assistance Programs (Continued)
and not be detected. Also, projection of any evaluation of the structure to future
periods is subject to the risk that procedures may become inadequate because of changes
in conditions or that the effectiveness of the design and operation of policies and
procedures may deteriorate.
For the purpose of this report, we have classified the significant internal
control structure policies and procedures used in administering federal financial
assistance programs in the following categories:
Claims for Advances and Reimbursements
General Requirements
• Political Activity
• Davis -Bacon Act
• Civil Rights
• Cash Management
• Federal Financial Reports
• Allowable Cost /Cost Principles
• Drug -Free Work -Place Act
• Administrative Requirements
Specific Requirements
• Types of Services
• Eligibility
For all of the internal control structure categories listed above, we obtained an
understanding of the design of relevant policies and procedures and determined whether
they have been placed in operation, and we assessed control risk.
During the year ended September 30, 1996, the City of Schertz, Texas, had no major
federal financial assistance programs and expended 100 percent of its total federal
financial assistance under its nonmajor federal financial assistance programs:
United States Department of Housing and Urban Development - Texas
Department of Housing and Community Affairs
We performed tests of controls, as required by OMB Circular A -128, to evaluate the
effectiveness of the design and operation of internal control structure policies and
procedures that we have considered relevant to preventing or detecting material
noncompliance with specific requirements, general requirements, and requirements
governing claims for advances and reimbursements and amounts claimed or used for
matching that are applicable to the aforementioned nonmajor programs. Our procedures
were less in scope than would be necessary to render an opinion on these internal
control structure policies and procedures. Accordingly, we do not express such an
opinion.
Reportable conditions involve matters coming to our attention relating to
significant deficiencies in the design or operation of the internal control structure
that, in our judgment, would adversely affect the City of Schertz, Texas' ability to
administer federal financial assistance programs in accordance with applicable laws and
regulations.
107
Independent Auditor's Report on
Internal Control Structure Used in Administering
Federal Financial Assistance Programs (Continued)
A material weakness is a condition in which the design or operation of one or more
of the internal control structure elements does not reduce to a relatively low level
the risk that noncompliance with laws and regulations that would be material to a
federal financial assistance program may occur and not be detected within a timely
period by employees int he normal course of performing their assigned functions. We
noted no matters involving the internal control structure and its operations that we
consider to be material weaknesses as defined above.
our consideration of the internal control structure policies and procedures used
in administering federal financial assistance would not necessarily disclose all
matters in the internal control structure that might be reportable conditions and,
accordingly would not necessarily disclose all reportable conditions that are also
considered to be weaknesses.
This report is intended for the information of the City of Schertz, Texas"
management and city council. However, this report is a matter of public record, and
its distribution is not limited.
San Antonio, Texas
April 11, 1997
�JA14d& JO,114�W
Certified Public Accountants
108
The Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Independent Auditor's Report on Compliance
with the General Requirements Applicable to
Federal Financial Assistance Programs
We have audited the general purpose financial statements of the City, of Schertz,
Texas, as of and for the year ended September 30,'1996, and have issued our report
thereon dated April 11, 1997.
We have applied procedures to test the City of Schertz, Texas', compliance with the
following requirements applicable to its federal financial assistance programs which
are identified in the Schedule of Federal Financial Assistance for the year ended
September 30, 1996: political activity, Davis -Bacon Act, civil rights, cash
management, federal financial reports, allowable costs /cost principles, Drug -free Work-
place Act, and administrative requirements.
Our procedures were limited to the applicable procedures described in the Office
of Management and Budget's Compliance Supplement for Single Audits of State and Local
Governments. Our procedures were substantially less in scope than an audit, the
objective of which is the expression of an opinion on the City of Schertz, Texas'
compliance with the requirements listed in the.preceding paragraph. Accordingly, we
do not express such an opinion.
With respect to the items tested, the results of those procedures disclosed no
material instances of noncompliance with the requirements listed in the second
paragraph of this report. With respect to items not tested, nothing came to our
attention that caused us to believe that the City of Schertz, Texas, had not complied,
in all material respects, with those requirements.
This report is intended for the information of the City of Schertz, Texas'
management and city council. However, this report is a matter of public record and its
distribution is not limited.
�
aVM, 0'� .
Certified Public Accountants
San Antonio, Texas
April 11, 1997
R. LARRY THOMPSON. C.P.A. / PAUL E. WILLIAMS, C.P.A. / JAMES L. BIEDIGER, JR., C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG, JR., C.P.A.
JOHN LEIF, C.P.A. / H. LEE SCHWARTZMAN, C.P.A. / F. GLENN CRAVEY C.P.A. / FRED J. TIMMONS, C.P.A. / JOHN W. GREEN, C.P.A.
JAMES T McCARTY, C.P.A. (RETIRED) 109
Thompson,
Williams,
Biediger,
NORTH TOWER
Kastor CERTIFIED PUBLIC ACCOUNTANTS
800 N.W. LOOP 410, SUITE 300N
SAN ANTONIO. TEXAS 78216 -5611
210/341.2581
FAX 2101341.2588
MEMBERS AMERICAN INSTITUTE OF
Young, CERTIFIED PUBLIC ACCOUNTANTS
L.C.
The Honorable Mayor and
Members of the City Council
City of Schertz, Texas
Independent Auditor's Report on Compliance
with the General Requirements Applicable to
Federal Financial Assistance Programs
We have audited the general purpose financial statements of the City, of Schertz,
Texas, as of and for the year ended September 30,'1996, and have issued our report
thereon dated April 11, 1997.
We have applied procedures to test the City of Schertz, Texas', compliance with the
following requirements applicable to its federal financial assistance programs which
are identified in the Schedule of Federal Financial Assistance for the year ended
September 30, 1996: political activity, Davis -Bacon Act, civil rights, cash
management, federal financial reports, allowable costs /cost principles, Drug -free Work-
place Act, and administrative requirements.
Our procedures were limited to the applicable procedures described in the Office
of Management and Budget's Compliance Supplement for Single Audits of State and Local
Governments. Our procedures were substantially less in scope than an audit, the
objective of which is the expression of an opinion on the City of Schertz, Texas'
compliance with the requirements listed in the.preceding paragraph. Accordingly, we
do not express such an opinion.
With respect to the items tested, the results of those procedures disclosed no
material instances of noncompliance with the requirements listed in the second
paragraph of this report. With respect to items not tested, nothing came to our
attention that caused us to believe that the City of Schertz, Texas, had not complied,
in all material respects, with those requirements.
This report is intended for the information of the City of Schertz, Texas'
management and city council. However, this report is a matter of public record and its
distribution is not limited.
�
aVM, 0'� .
Certified Public Accountants
San Antonio, Texas
April 11, 1997
R. LARRY THOMPSON. C.P.A. / PAUL E. WILLIAMS, C.P.A. / JAMES L. BIEDIGER, JR., C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG, JR., C.P.A.
JOHN LEIF, C.P.A. / H. LEE SCHWARTZMAN, C.P.A. / F. GLENN CRAVEY C.P.A. / FRED J. TIMMONS, C.P.A. / JOHN W. GREEN, C.P.A.
JAMES T McCARTY, C.P.A. (RETIRED) 109
(This Page Intentionally Left Blank)
110
Thompson,
Williams,
NORTH TOWER Biediger, Kastor
800 N.W. LOOP 410, SUITE 300N
SAN ANTONIO, TEXAS 78216 -5611
210/341.2581 Young
FAX 210/341 -2588
L.C.
To the Honorable Mayor and
Members of the City Council
City of Schertz, Texas
CERTIFIED PUBLIC ACCOUNTANTS
MEMBERS AMERICAN INSTITUTE OF
CERTIFIED PUBLIC ACCOUNTANTS
Independent Auditor's Report on Compliance
with Specific Requirements Applicable to Nonmaior
Federal Financial Assistance Program Transactions
We have audited the general purpose financial statements of the City of Schertz,
Texas, as of and for the year ended September 30, 1996, and have issued our report
thereon dated April 11, 1997.
In connection with our audit on the general purpose financial statements of the
City of Schertz, Texas, and with our consideration of the City of Schertz, Texas,
internal control structure used to administer federal financial assistance programs,
as required by Office of Management and Budget Circular A -128, Audits of State and
Local Governments, we selected certain transactions applicable to certain nonmajor
federal financial assistance programs for the year ended September 30, 1996. As
required by OMB Circular A -128, we have performed auditing procedures to test
compliance with the requirements governing types of services allowed or unallowed and
eligibility that are applicable to those transactions. Our procedures were
substantially less in scope than an audit, the objective of which is the expression on
an opinion on the City of Schertz, Texas' compliance with these requirements.
Accordingly, we do not express such an.opinion.
With respect to the items tested, the results of those procedures disclosed no
material instances of noncompliance with the requirements listed in the preceding
paragraph. With respect to items not tested, nothing came to our attention that caused
us to believe that the City of Schertz, Texas, had not complied, in all material
respects, with those requirements.
This report is intended for the information of the City of Schertz, Texas'
management and city council. However, this report is a matter of public record and its
distribution is not limited.
Certified Public Accountants
San Antonio, Texas
April 11, 1997
R. LARRY THOMPSON, C.P.A. / PAUL E. WILLIAMS. C.P.A. / JAMES L. BIEDIGER. JR.. C.P.A. / C. TED KASTOR, C.P.A. / CHARLIE E. YOUNG. JR., C.P.A.
JOHN LEIF C.P.A. / H. LEE SCHWARTZMAN, C.P.A. / F. GLENN CRAVEY. C.P.A. / FRED J. TIMMONS, C.P.A. / JOHN W. GREEN, C.P.A.
JAMES T MCCARTY, C.P.A. (RETIRED) 111