Comprehensive Annual Financial ReportC(4'SPc--ilq
CITY OF ALLEN, TEXAS
11
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
CITY OF ALLEN
FISCAL YEAR ENDED
SEPTEMBER 30, 2003
AS PREPARED BY THE
FINANCE DEPARTMENT
CITY OF ALLEN, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2003
TABLE OF CONTENTS
Exhibit Page
I. INTRODUCTORY SECTION
Letter of Transmittal
Certificate of Achievement All
Organizational Chart xiv
Elected Officials and Administrative Officers xv
II. FINANCIAL SECTION
Independent Auditors' Report 1
A. MANAGEMENT'S DISCUSSION AND ANALYSIS 3
B. BASIC FINANCIAL STATEMENTS
Government -Wide Financial Statements
Statement of Net Assets
1
2
17
16
Statement of Activities
Fund Financial Statements
Governmental Funds Financial Statements
Balance Sheet— Governmental Funds
3
20
Reconciliation of the Balance Sheet of Government
Funds to the Statement of Net Assets
4
22
Statement of Revenues, Expenditures and
24
Changes in Fund Balances — Governmental Funds
5
Reconciliation of the Statement of Revenues,
Expenditures and Changes in Fund Balances
of Governmental Funds to the Statement
of Activities
6
26
Proprietary Funds Financial Statements
Statement of Net Assets — Proprietary Funds
7
27
Reconciliation of the Statement of Net Assets
of Proprietary Funds
6
28
Statement of Revenues, Expenses and Changes
29
In Net Assets — Proprietary Funds
9
Reconciliation of the Statement of Revenues,
Expenses and Changes in Net Assets of
Proprietary Funds to the Statement of Activities
10
30
Statement of Cash Flows — Proprietary Funds
11
31
Component Units Financial Statements
Statement of Net Assets — Component Units
12
32
Statement of Activities — Component Units
13
33
CITY OF ALLEN, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2003
TABLE OF CONTENTS
Exhibit
C. NOTES TO FINANCIAL STATEMENTS
Note 1
Summary of Significant Accounting policies
Note 2
Deposits, Investments and Investment Policies
Note 3
Receivables
Note 4
Capital Assets
Note 5
Long -Term Debt
Note 6
Interfund Receivables and Payables
Note 7
Interfund Transfers
Note 8
Retirement Plan
Note 9
Water and Sewer Contracts
Note 10
Deferred Compensation Plan
Note 11
Self -Insurance and Risk Management
Note 12
Commitments and Contingent Liabilities
Note 13
Prior Period Adjustment
D. REQUIRED SUPPLEMENTARY INFORMATION
General Fund Statement of Revenues, Expenditures
And Changes in Fund Balances — Budget and Actual
Notes to Required Supplementary Information
E. COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES
Major Governmental Funds
Comparative Balance Sheets - General Fund
Comparative Statement of Revenues, Expenditures and
Changes in Fund Balances — General Fund
Comparative Balance Sheets — Debt Service Fund
Comparative Statement of Revenues, Expenditures and
Changes in Fund Balances — Debt Service Fund
Budgetary Comparison Schedule — Debt Service Fund
Comparative Balance Sheets — Facilities Agreement Fund
Comparative Statement of Revenues, Expenditures and
Changes in Fund Balances - Facilities Agreement Fund
Comparative Balances Sheets — General Capital Projects Fund
Comparative Statements of Revenues, Expenditures and
Changes in Fund Balances —
General Capital Projects Fund
A-1
B-1
B-2
B-3
B-4
B-5
B-6
B-7
B-8
-1"
Page
35
42
44
45
49
56
57
58
60
61
61
62
62
65
66
T
71
72
73
74
75
76
77
78
CITY OF ALLEN, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2003
TABLE OF CONTENTS
Exhibit
Page
Comparative Balance Sheets — Street Improvements Fund
B-10
79
Comparative Statements of Revenues, Expenditures and
Changes in Fund Balances — Street Improvement Fund
8-11
80
Comparative Balance Sheets — Park Improvement Fund
B-12
81
Comparative Statements of Revenues, Expenditures and
Changes in Fund Balances — Park Improvement Fund
B-13
82
Comparative Balance Sheets — Library Fund
B-14
83
Comparative Statements of Revenues. Expenditures and
. Changes in Fund Balances — Library Fund
B-15
84
Non -major Governmental Funds
Combining Balance Sheet
C-1
86
Combining Statement of Revenues, Expenditures and
Changes in Fund Balances
C-2
88
Major Enterprise Funds
Comparative Statements of Net Assets — Water and Sewer
D-1
92
Comparative Statement of Revenues, Expenses and
Changes in Fund Net Assets — Water and Sewer
D-2
93
Comparative Statements of Cash Flows — Water and Sewer
D-3
94
Comparative Statements of Net Assets — Solid Waste
D-4
95
Comparative Statement of Revenues, Expenses and
Changes in Fund Net Assets — Solid Waste
D-5
96
Comparative Statements of Cash Flows — Solid Waste
D-6
97
Comparative Statements of Net Assets — Drainage
D-7
98
Comparative Statement of Revenues, Expenses and
Changes in Fund Net Assets — Drainage
0-8
99
Comparative Statements of Cash Flows — Drainage
D-9
100
Internal Service Funds
Combining Statement of Net Assets
E-1
102
Combining Statement of Revenues, Expenses and
Changes In Fund Net Assets
E-2
103
Combining Statement of Cash Flows
E-3
104
F. CAPITAL ASSETS USED IN THE OPERATION OF GOVERNMENTAL FUNDS
Comparative Schedules by Source
F-1
105
Schedule by Function and Activity
F-2
106
Schedule of Changes by Function and Activity
F-3
108
CITY OF ALLEN, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2003
TABLE OF CONTENTS
Table
Page
III. STATISTICAL SECTION
General Governmental Expenditures by Function
1
110
General Governmental Revenues by Source
2
112
Ad Valorem Tax Levies and Collections
3
114
Assessed and Estimated Actual Value of
Taxable Property
4
116
Property Tax Rates — Direct and
Overlapping Governments
5
117
Ratio of Net General Bonded Debt to Assessed
Value and Net Bonded Debt Per Capita
6
118
Ratio of Annual Debt Service Expenditures to
General Bonded Debt To Governmental Expenditures
7
120
Computation of Legal Debt Margin
8
121
Computation of Direct and Overlapping Debt
9
122
Property Values, Construction and Bank Deposits
10
123
Principal Taxpayers
11
124
Miscellaneous Statistical Facts
12
125
Demographic Statistics
13
126
Introductory
Section
CITY OF ALLEN
March 25, 2004
Honorable Mayor, Members of the
City Council, City Manager and
Citizens
City of Allen, Texas
The Comprehensive Annual Financial
Report (CAFR) of the City of Allen,
Texas (the "City"), for the fiscal year
ended September 30, 2003, is hereby
submitted. The report was prepared
by the Finance Department and our
independent auditors, Weaver and
Tidwell, L.L.P. This report is prepared
to provide the City Council, City staff,
our citizens, our bondholders, and
other interested parties with detailed
information concerning the financial
condition and activities of the City
government. Responsibility for both
the accuracy of the
Presented data and
the completeness
and fairness of the
Presentation,
including all
disclosures, rests
with the City. We
believe that the data,
as presented, is
accurate and
Presented in a manner designed to
fairly set forth, in all material respects,
the financial position and results of
operations of the City with all
disclosures necessary to enable the
reader to gain an understanding of the
City's financial affairs.
In the current year's financial
statements, the City had to implement
a dramatic change in governmental
financial reporting because of changes
in reporting requirements by the
Government Accounting Standards
Board (GASB). We believe this new
presentation will provide better
information to users of the CAFR. The
new reporting model issued by GASB
requires that management provide a
narrative introduction, overview, and
analysis to accompany the basic
financial statements in the form of
Management's
Discussion and
Analysis (MD&A).
This letter of
transmittal is
designed to
complement MD&A
and should be read in
conjunction with it.
The City's MD&A can
be found immediately
following the
independent auditor's report.
The Comprehensive Annual Financial
Report is presented in three sections:
introductory, financial and statistical.
The introductory section includes this
transmittal letter, the City's
organizational chart, and a list of
ALLEN CIVIC PLAZA • 305 CENTURY PARKWAY • ALLEN, TEXAS 75013-8062
972!127-0100
EMAIL: coa®cityofa0m.mg
principal officials. The financial
section includes. the Management's
Discussion and Analysis, government -
Wide and major fund presentations,
required supplementary information,
combining and individual fund
statements, as well as the
independent auditor's report on the
financial statements and schedules.
The statistical section includes
selected financial and demographic
information, generally presented on a
multi-year basis.
In addition to issuance of the CAFR,
the independent auditors have
performed a Single Audit and issued
auditor reports on the City's state
awards for the fiscal year ended
September 30, 2003. The City's
single audit report is separately
available by contacting the City's
Finance Department.
CITY OF ALLEN PROFILE
The City of Allen is located in Collin
County, 25 miles north of downtown
Dallas on U.S.75. Allen is bordered to
the north by the City of McKinney; by
the Town of Lucas to the east and by
the City of Plano to the south and
west. Allen, together with its
neighboring cities,
forms the greater
metropolitan Dallas
area, which is the -
Southwest's
st's leading
business
s, tit
financial center.
The relocation of high r
technology police Headquarters
companies in the, r,
1960's drastically
increased employment opportunities
for Allen's citizens. The City has
experienced significant increases in
population, from 24,493 in 1994 to
63,643 in 2003 and is estimated to
surpass 95,000 in the year 2010.
Allen was settled in the early 1850s
from land grants given by the Republic
of Texas as an inducement for settlers
to come to the frontier. The City is a
home rule city operating under the
Council -Manager form of government
and was incorporated in 1953. The
City Council is comprised of the Mayor
and six Council members, who enact
local laws, determine policies and
adopt the annual budget. The City
Council appoints the City Manager,
who has full responsibility for carrying
out Council policies and administering
City operations. City service
departments provide a full range of
services including police and fire
protection, sanitation/solid waste
service, water and sewer services,
construction and maintenance of
streets, recreational activities and
cultural events.
The annual budget serves as the
foundation for Allen's financial
planning and control. Annual budgets
are legally adopted for the General
Fund and Debt Service Fund. Each
year the City Manager is required to
submit to the City Council a proposed
budget for the fiscal
year beginning on the
following October 1.
F The operating budget
'2` includes proposed
fir- 1' expenditures and the
.,ins means of financing
them. Public
hearings are
conducted to obtain
taxpayers' comments.
Prior to October 1, the budget is
legally enacted by the City Council
through passage of an ordinance,
setting the limit for expenditures during
the fiscal year. Expenditure
appropriations in the adopted budget
are by department and may be
amended during the year. The City
Manager is authorized to adjust
budgeted amounts; however, such
revisions may not result in total
expenditures exceeding budgeted
expenditures without approval of the
City Council.
Formal budgetary integration is not
employed for Special Revenue Funds,
Proprietary Funds or Capital Project
Funds. However, the City does adopt
an annual budget for those funds for
managerial control.
FACTORS AFFECTING THE
CITY'S FINANCIAL CONDITION
Economic Development - As
development expanded outward from
Dallas and growth spread northward,
the City Council created
the Allen Economic
Development
Corporation (AEDC) to
receive and disperse the
one-half cent sales tax
approved by voters for
economic development.
Since its inception in
1992, AEDC has
dedicated its resources
to developing first-class
technology parks and
recruiting quality
industries to the
community.
Although 2003 was a
challenging year for many
communities across north Texas, Allen
experienced significant developments
that contributed to its healthy
economic growth. Sage Telecom,
named the fastest growing company in
the Dallas/Fort -Worth Metroplex by the
Dal/as Business Jouma/, is rapidly
becoming one of Allen's largest
employers. As the local and long-
distance service provider expanded
into eleven states, they were looking
to expand in their corporate
headquarters. The AEDC worked
closely with Sage to retain the
company and its 500 employees at the
Allen Office Center.
Allen has earned a reputation as an
attractive location for new business
start-ups. In 2003, several companies
that had operated in "stealth" mode
rolled out their products.
• Ceterus Networks, a provider
of a unique "single virtual
pipe" for transport of Metro
Ethernet services, unveiled
their Universal Transport
SystemTM^ family of network
devices. Located
in the Bethany
Tech Center, the
company employs
approximately 50
people.
iii
• Integrated Trading
Solutions (ITS), a
provider of
platforms,
execution services
and data services
for financial
institutions also
opened their
headquarters in
Allen in the
Bethany Tech Center. A
division of Dallas -based
Penson Worldwide Inc., ITS
also acts as a gateway to all
major U.S., Canadian and
European Exchanges for
automated trading programs.
• J. Suzette moved into Allen
Station Business Park, the
newest officettech
development in Allen located
on Exchange Parkway, east
of U.S.75. The company
designs apparel patterns for
major catalog retailers such
as Land's End and Eddie
Bauer.
The year 2003 was active for small
office, officettech and warehouse
leasing activity.
• JEH/MSI Eagle
Supply, a roofing
and masonry
supply distributor
leased 33,000
square feet at 815
Enterprise
Boulevard.
• Blueridge Office
Park, a 40,000
square foot complex located
on the northwest corner of
S.H.5/Greenville Avenue and
Ridgemont Drive, started the
year virtually vacant and is
now 80% leased with a
number of small companies.
sale, now has only 16,000
square feet remaining.
Major medical office developments
were unveiled in 2003 which will add
more than 200,000 square feet of
medical office to Allen.
• Presbyterian Hospital
announced plans to build a
three-story, 60,000, square
foot medical office complex
on 21 acres adjacent to the
hospital. In addition, the
hospital announced it will
double its bed capacity, add
eight intensive -care beds and
enhance diagnostic services.
. Allen Business Centre,
located north of Bethany
Drive and west of S.H.5 and
Greenville Avenue, is now
fully leased.
• Jupiter Office, at 305 South
Jupiter Road, which originally
had over 45,000 square feet
of office available for lease or
iv
• JaRyCo
Development
broke ground
on the first of
three
medical
office
buildings just
south of the
hospital.
When
complete, Twin Creeks
Medical Center will contain
over 100,000 square feet of
medical office space.
• On the southwest corner of
Exchange Parkway and
U.S.75, Landesta Corporation
announced plans for
MedCentral, a 30,000 square
foot medical office complex.
The AEDC works closely with
commercial brokers to market anchor
retail space in Allen. In 2003, the
AEDC assisted in the recruitment of
Stacy Home Furnishings Center which
purchased a 125,000 square foot
space in Twin Creeks Shopping
Village. Stacy is a "destination"
retailer, drawing shoppers from a
wider radius than many furniture
retailers because of its unique store
design and diverse selection of
furniture and accessories. The
complex also features a full service
restaurant and daycare center. The
entire project is estimated to generate
$20430 million in annual sales,
growing to $40 million in 3 to 5 years.
Allen's continued population growth
and excellent demographics have
attracted new retail, restaurants and
services to the City. With a median
household income of $85,189, white
collar workers comprise 81% of the
workforce. This has brought new bank
branches to Allen including Regions,
Hibernia, First American Bank, Bank
of America, Bank One and
Washington Mutual and new
restaurants including Cliff's Star
Neighborhood Grill (located inside
Stacy Furniture) Pei Wei, Tin Star,
Chipotle and Bennigan's.
Property Values — Assessed property
values increased $598 million (18%)
from the preceding
year. The increase is Alle
accounted for by $336
million in new property
and a $262 million
increase in the value of
existing property.
Assessed property
value has increased
115% over the past five
years and accounts for
43% of the General
Fund revenue budget. Increases in
assessed property value along with
continued economic growth have
allowed the City Council to lower the
property tax rate for the tenth
consecutive year while improving
quality services to its citizens.
Retail Sales - Similar to other
communities in Takes and the United
States, Allen's retail economy faced
significant challenges in 2002-2003
fiscal year. Early in the fiscal year
sales tax revenues were not meeting
projections, and it became evident that
the slow economic conditions would
have an impact on that and other key
revenue sources for the remainder of
the year. Therefore, in January 2003,
the City implemented an action plan
based on projected General Fund
revenue shortfalls of approximately
$1.2 million. Components of the
contingency plan included:
• Reducing department
budgets by approximately
3%
• Initiating a hiring freeze until
April 1 for new non-public
safety positions, and
• Restricting staff travel and
conferences.
In March, the projected shortfall was
revised to approximately $1.5 million.
In order to offset the
n 10utletadditional amount,
the hiring freeze was
extended to October
1, and was expanded
to include all vacant
positions (non-public
safety). Also, some
t;additional operating
reductions were
taken. This approach
allowed the City to maintain quality
services to Its citizens, increase the
General Fund balance by $421,208
and avoid employee layoffs.
Long -Term Financial Planning — The
City's annual budget process involved
incorporating the goals and strategies
identified by the City Council's three-
year Strategic Plan to provide for the
community's highest priority needs.
The goal statements developed by the
City Council are:
• Enhance neighborhood
livability and safety.
• Cultivate alliances and
partnerships with agencies
and governmental units that
affect Allen.
• Continue to provide first-rate
emergency services.
• Manage growth and
development to preserve
Allen's character.
• Improve regional mobility
through transportation
initiatives.
• Promote the continued
development of recreational
opportunities.
• Systematically invest in
community infrastructure.
• Achieve operational
excellence in City
government services.
• Signify City of Allen identity
through
beautification
efforts.
• Ensure good
fiscal
management.
Individual c _
departments -A-- Don Rodenbau
develop their goals y
and objectives in
terms of these all-encompassing
organizational goals.
Vi
Strategic Financial Plan — An
appropriate financial plan for the City
of Allen requires many elements all
working in concert with one another.
In 2002 Allen's Finance Department
recognized the slow down in the
economy resulting in budget
reductions to cover the potential sales
tax revenue shortfall. Current
expectations are for modest sales tax
revenue growth, potential reductions
of state revenue sharing, and
additional demands for "essential" City
services such as police, fire, water,
sewer, drainage and street
improvement. The Finance
Department's management role will be
to maintain and enhance financial plan
elements and ensure the continued
financial stability for the City of Allen.
Financial Resource Planning —
Strategic planning begins with
determining the City's fiscal capacity
based upon long -tens financial
forecasts of recurring available
revenues. Financial forecasts coupled
with financial trend analysis
techniques and careful reserve
analysis will preserve the fiscal well
being of Allen. Strategic planning is a
critical element not only to meet long-
term financial stability goals but also to
determine City
Council objectives
that will require
-_w special financial
<' planning to achieve
"" success.
Strategic Capital
Improvement
gh NaWori m Program Planning
— The City of Allen's
Capital Improvement Program (CIP) is
a multi-year financial plan for the
acquisition, expansion, or
rehabilitation of infrastructure, capital
assets, or productive capacity of City
services. The City's operating and
capital projects budgets are closely
linked.
Revenues for the capital budget come
primarily from bond sales,
supplemented by development fees
and some current revenues. The
capital improvement program unlike
the operating budget is a five-year
plan and is reviewed and projects are
reprioritized on an ongoing basis.
Although not formally adopted as part
of the annual budget, project budgets
are used as a guide for project, debt
and other related budget planning. As
such, future years are subject to
change; in addition, debt issuance for
many future projects is subject to voter
approval.
Throughout the year
projects are
monitored and
reprioritized as
needed. The City
utilizes the project
accounting and
budgeting
components of the
financial software to
assist with the
monitoring aspect of the process.
Monthly reports are provided to
Council to keep them informed of the
status of projects.
revenue bases for the repayment of
debt, the overall debt burden on the
community, statutory limitations and
market factors affecting tax-exempt
interest costs. Sizing of the City's
Capital Improvement Program based
on debt capacity in conjunction with
conservatively estimated pay-as-you-
go revenues will help stabilize per
capita debt and lower annual debt
service costs to the City over the long-
term.
Cash Management Policies and
Practices — The City of Allen's
investment policy is to invest all City
funds at the highest available interest
rate, assuring that all monies are fully
secured with emphasis on safety of
principal, liquidity,
yield, diversification,
and public trust.
State statutes
authorize the City to
invest in U.S.
Government
obligations,
obligations of Texas
and its agencies and
fully collateralized
repurchase
agreements. The City
utilizes a pooled cash concept in order
to invest greater amounts of cash at
one time and therefore receives more
favorable interest rates.
Debt Management
issuances are for the
purposes of financing
capital infrastructure
or long-lived costly
assets. Each debt
issuance is evaluated
against multiple
policies addressing:
debt service as a
percent of operating
expenditures, tax and
— All debt Insurance and
Vii
Risk Management -
The City has a
comprehensive risk
management
program, including
property, liability,
safety, workers'
compensation, health
and wellness.
Administration of
these functions
requires participation
from the Human Resources
department, outside legal counsel and
consultants.
The City has established a self-
insurance plan for City employees and
their covered
dependents for medical
and dental care. A
third -party insurance
company re -insured the
City for individual
claims in excess of
$25,000. The City
participates in the
Texas Municipal
League
Intergovernmental Risk
Pool (TMLIRP), which provides the
City with risk financing and loss
prevention services. TMLIRP carries
the City's general liability, property and
casualty insurance and workers
compensation. Each category of
coverage has a specific deductible per
occurrence. The Texas Tort Claims
Act limits the liability of a municipality
to a maximum of $250,000 for each
person and $500,000 for each
occurrence for bodily injury or death
and $100,000 for each occurrence or
injury to or destruction of property.
Purchasing division is responsible for
the procurement of items required to
operate and maintain the City. This
division assists all departments in
planning and maintaining the City's
financial health, by establishing a
uniform procedure for
obtaining goods and
services in an
effective and timely
manner in
accordance with
generally accepted
purchasing
procedures and
legally mandated
procurement
standards. The City
has contracted with DemandStar.com
for the maintenance of an automated
vendor list which categorizes each
vendor by commodity codes for the
specific goods or services offered by
the vendor.
Allen has an aggressive safety
incentive program that promotes
employee safety on the job and
focuses on risk control techniques
designed to minimize
accident -related losses.
In addition to the safety
program's preventive
measure, claims are
closely monitored in
order to minimize the
City's liability exposure.
Procurement Planning -
Under the Finance
Department, the
FISCAL YEAR 2003 HIGHLIGHTS
Fiscal 2002-2003 reflects a very
conservative approach to City
operations considering the country's
economic conditions while carefully
balancing the expansion of services
and amenities that define the special
character of the City. These programs
and amenities will assist in maintaining
Allen as a 'livable" community for
future generations.
Key projects
completed during the
year included:
• Construction
Of
Celebration
Park Phase
1. The 100 -
plus acre
park includes 15 soccer
the City's property tax base, generate
fields, four baseball
additional revenues, and improve
diamonds, Kid Mania
services in meeting the needs of its
playground, water spray
citizens. Such initiatives include:
ground, and two fishing lakes.
The City's annual Fourth of
• Main Library / Auditorium.
July celebration was held
Construction of a 60,000
here, in conjunction with the
square -foot facility for a
grand opening of the park.
library/auditorium to replace
the present library facility,
• Historic Village desian phase.
located on Allen Drive at St.
As part of the redevelopment
Mary Drive.
of the Central Business
District, this area is designed
• Adaptive re -use of former
to preserve some of the City's
library. Convert former library
significant structures.
to municipal court and county
offices.
• Street Construction. New
streets built include West
• Central Business District
Bethany, from Bel Air to
(CBD). Redevelopment of
Alma; Exchange Parkway,
the CBD in the historic area
from Greenville Avenue to
of Allen surrounding Main
Angel Parkway; Ash Drive,
Street; covering
from McDermott Drive to
approximately 200 acres will
Main Street; Ridgeview Drive,
be home to the City's new
from Stacy Road to 1,700 ft.
library, the Historic Village,
east; Phase 2 of the alley
and an expanded Allen
replacement program and
Station Park.
Phase 2 of Asphalt Street
Rehabilitation.
• Civic Center Plaza. Plaza
landscape, public art, and
•Sewer lift station at
water feature.
Summerside Drive and
Malone Road. The City
• Performing Arts Complex. A
undertook contractual
regional performing arts
maintenance of
center in
the AISD lift
conjunction with
station at Bolin 1
the cities of
Elementary to
Plano, and
help assure sewer r: I , ,�
'f .. Frisco.
system f.
b:
• Senior Citizen
Center. Design
The City has numerous
and construction
capital projects and Allen Station Park of a 20,000
economic development
square foot
initiatives underway or
facility at St. Mary and Cedar
in the planning stage that will increase
Drive.
ix
• Allen Station Park. Phase 2.
Design and construction of a
teen center, skate -park,
hockey courts, plaza, trails,
orchard, parking and
pedestrian bridges.
• Celebration Park, Phase 2.
Additional baseball fields,
restrooms, concession
building, signage, parking and
trails. (Phase 1, completed
during fiscal year 2003,
included approximately 80 to
85 percent of the total 103
acres this park will cover.)
• Construction and extension of
several roads. St. Mary Drive
Extension, 700 feet from Ash
Drive to Cedar Drive; Coats
Drive, Allen Drive to Butler
Drive (340 feet); expansion of
S.H.5 from Exchange
Parkway to Stacy Road;
extension of Main Street
(F.M. 2170), 6 -lanes from
Allen Heights to F.M. 2551 in
conjunction with the Texas
Department of Transportation
(TXDOT).
• U.S.75 Intersection
Landscaping Joint project
between the City and
TXDOT, which includes
material and annual
maintenance casts.
• Twin Creeks Drainage
Correction of storm water
flows to reduce stream
erosion.
• Prestige Elevated Storage
Improves the capacity and
Pressure of the water system.
• Ola Lift Station. Replacement
project.
• West Side Water Main. 36"
and 24" mains extending from
Custer Road Pump Station to
Twin Creeks Phase VIII and
from Twin Creeks Phase VI to
Alma/Bel Air intersection.
• Other Projects.
Drainage
system construction and
improvements;
construction
and renovation
of various
neighborhood
parks,
greenbelts, and
sidewalks;
maintenance
of alley
approaches,
including
replacement of
concrete
alleys and asphalt pavement;
and traffic management and
signals.
AWARDS AND
ACKNOWLEDGEMENTS
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 of Allen
for its comprehensive annual financial
report for the fiscal year ended
September 30, 2002. This was the
fifth consecutive year that the
government has achieved this
prestigious award. In order to be
awarded a Certificate of Achievement,
a government must publish an easily
readable and efficiently organized
comprehensive annual financial report.
This report must satisfy both generally
accepted accounting principles and
applicable legal requirements.
A Certificate of Achievement is valid
for a period of one year only. We
Governmental Accounting Standards
Board Statement No. 34.
We would also like to thank the City
Manager's office and the members of
the City Council for their interest and
support in planning and conducting the
financial operations of the City in a
responsible and progressive manner.
Acknowledgment is also given to the
representatives of Weaver and
Tidwell, L.L.P. for their invaluable
assistance in producing the final
document.
Respectfully submitted,
�mmeke
Director of Finance
xii
Joanne Stoehr
Assistant Finance Director
believe that our current
comprehensive annual financial report
continues to meet the Certificate of
Achievement Program's requirements,
and we are submitting it to the GFOA
to determine its eligibility for another
certificate.
The City received numerous other
awards throughout the year. Among
them were:
❖ Certificate for Outstanding
Performance -Texas
Commission on
Environmental Quality,
Public Drinking Water
Section of the Water Supply
Division
❖ Texas Crime Prevention
Officer of the Year
❖ National Night Out, STEP-
Seatbeft Enforcement
•e Excellence in Procurement
Award
❖ Certificate of Achievement
for Planning Excellence for
2003
❖ Community of the Year -
Texas Chapter of the
American Planning
Association
f• Dallas County Corporate
Recycling Council — Finalist
S• Texas Community Forestry
Award -Urban Forestry
Development
:• Membership Award -Texas
Amateur Athletic Federation
Region VII
S• Best Web Site Award -Texas
Recreation and Parks
Society Region III
❖ Texas Association of
Telecommunications
Officers and Advisors Award
❖ Outstanding Media Award.
Texas Crime Prevention
Association
❖ Communicator Crystal
Award of Excellence
Acknowledamenfa
The preparation of this report on a
timely basis could not have been
accomplished without the efficient and
dedicated services of the entire staff of
the Finance Department. Appreciation
is expressed to those employees and
other City employees throughout the
organization, especially Vivian
Leverington, Senior Accountant, Laci
Culbert, Senior Accountant, Trish
Featherston, Budget Analyst, Joyce
Blankenship, Accountant and Debbie
Sumrow, Senior Administrative
Assistant, who were instrumental in
the successful completion of this
report. These individuals worked
many hours and exhibited
extraordinary effort in ensuring the
accuracy and timeliness of this report,
and their contribution to this effort is
greatly appreciated.
We would like to acknowledge the
Engineering Department this year for
their invaluable assistance with the
City's first year of implementation of
infrastructure reporting required by
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Allen,
Texas
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
September 30, 2002
A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
3 w 0
President
.� saai
Executive Director
City of Allen
Organizational Chart
xiv
CITY OF ALLEN, TEXAS
CITY OFFICIALS
IVES
CITY OF ALLEN
Council Members
Mayor
Mayor Pro Tem, Place 5
Place 1 Council Member
Place 2 Council Member
Place 3 Council Member
Place 4 Council Member
Place 6 Council Member
Stephen Terrell
Kenneth Fulk
Debbie Stout
Ross Obermeyer
Mark Pacheco
Susan Bartlemay
Jeff McGregor
Management Staff
City Manager Peter H. Vargas
Finance Director Kevin Hammeke
Assistant Finance Director Joanne Stoehr
CITY OF ALLEN
xvi
Financial
Section
II I INDEPENDENT AUDITOR'S REPORT
WEAVER
TIDWELL
L L.P.
CERTI`IED IncOUNUANTS
CONSULTANTS Honorable Mayor and Members of
AND Oyo
the City Council
CITY OF ALLEN, TEXAS
We have audited the accompanying financial statements of the governmental activities,
the business -type activities, each major fund and the aggregate remaining fund
information of the City of Allen (the "City') as of and for the year ended September 30,
2003, which collectively comprise the City's basic financial statements, as listed in the
table of contents. These basic financial statements are the responsibility of the City's
management. Our responsibility Is to express an opinion on these basic financial
statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the
United States of America 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 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 opinions.
In our opinion the basic financial statements referred to above present fairly, in all material
respects, the financial position of the governmental activities, the business -type activities,
each major fund, and the aggregate remaining fund information of the City of Allen at
September 30, 2003, and the respective changes in financial position and cash flows,
where applicable, thereof, for the year then ended in conformity with accounting principles
generally accepted in the United States of America.
As discussed in Note 1 to the financial statements, the City implemented a new financial
reporting model, as required by the provisions of Governmental Accounting Standards
Board ("GASB") Statement No. 34, Basic Financial Statements -and Management's
n LLRB
Discussions and Analysis -for State and Local Governments, GASB Statement No. 37,
rm„ F.— Pl—
Basic Financial Statements -and Management's Discussion and Analysis -for State and
12221 m,.,. IT—
Local Governments. Omnibus which additional guidance for the implementation of
Snm 1400
o„ rcu Tr- 75251-22xD
provides
GASB No. 34, and GASB Statement No. 38, Certain Financial Statement Note Disclosures,
912.490 1970
which changes note disclosure requirements for governmental entities.
F9.2902M1
The accompanying management's discussion and analysis and budgetary comparison
FORT WORTH
information on pages 3 through 16 and 65 through 66, respectively, are not a required part
1600 W.. s,V...1b S—,
of the basic financial statements but are supplementary information required by the GASB.
S 300
F,I11Vnb Tr ,-6102]506
We have applied certain limited procedures, which consisted principally of inquiries of
x21332 IPOs
management regarding the methods of measurement and presentation of the required
F en 4295936
supplementary information. However, we did not audit the information and express no
Y,w. WEAVERANDTIOWELL COM
opinion on it.
AN IH MEMBER OF
OE
BAKETILLY
City of Allen, Texas
February 27, 2004
Page Two
In accordance with Government Auditing Standards, we have issued a report dated
February 27, 2004, on our consideration of the City's internal control over financial reporting
and our tests of compliance with certain provisions of laws, regulations, contracts and
grants. That report is an integral part of an audit performed in accordance with
Government Auditing Standards and should be read In conjunction with this report in
considering the results of our audit.
Our audit was made for the purpose of forming opinions on the basic financial statements
taken as a whole. The introductory section, combining and Individual major and non -major
fund financial statements and statistical tables listed in the table of contents are presented
for purposes of additional analysis and are not a required part of the basic financial
statements of the City. The combining and individual major and non -major fund financial
statements have been subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, are fairly stated, in all material respects in relation
to the basic financial statements taken as a whole. The introductory section and statistical
tables have not been subjected to the auditing procedures applied in the audit of the basic
financial statements and, accordingly, we express no opinion on such data.
WEAVER AND TIDWELL, L.L.P.
Dallas, Texas
February 27, 2004
1431
Management's
Discussion
and Analysis
CITY OF ALLEN, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2003
As management of the City of Allen, Texas, we offer readers of the City's financial
statements this narrative overview and analysis of the financial activities of the City for
the fiscal year ended September 30, 2003. We encourage readers to consider the
information presented here in conjunction with additional information that is furnished in
the letter of transmittal, found on pages i to xii of this report. This discussion and
analysis does not include comparative data for prior years, as this information is not
available for the first year of implementation of Governmental Accounting Standards
Board Statement No. 34, Basic Financial Statements and Management's Discussion and
Analysis for State and Local Governments. Future years will include, when available,
comparative analysis of government -wide data.
FINANCIAL HIGHLIGHTS
• The assets of the City exceeded its liabilities (net assets) at September 30,
2003 by $352,721,649. Of this amount, $45,177,220 may be used to meet
the government's ongoing obligations to citizens and creditors (unrestricted
net assets).
• The Citys net assets increased by $11,973,394.
• The City's governmental funds reported combined ending fund balances of
$50,630,432 at September 30, 2003, an increase of $707,594 from the prior
year. The increase was due to county funds received for street
construction projects and contributions from the Water and Sewer Fund and
Drainage Fund to the General Capital Projects Fund.
• The City's unreserved fund balance for the General Fund was $7,432,287
at year end or 23% of total general fund expenditures for the reported fiscal
year.
• The City's total noncurrent liabilities of $97,959,638 increased by
$1,137,973 or 1.18%. During the reportedfiscal year $7,210,000 of
General Obligation (G.O.) Bonds and $2,705,000 in General Obligation
Refunding Bonds were sold.
OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis is intended to serve as an introduction to the City's basic
financial statements. The City's basic financial statements are comprised of three
components: 1) government -wide financial statements, 2) fund financial statements, and
3) notes to the financial statements. This report also contains other supplementary
information in addition to the basic financial statements.
In the past, the primary focus of local government financial statements has been
summarized fund type information on a current financial resource basis. This approach
has been modified and, for the first time, additional new statements are presented.
These new statements focus on the City as a whole (government -wide), as well as the
major individual funds. The new government -wide financial statements provide both
long-term and short -tens information about the City's overall financial status. The fund
financial statements, which have been provided in the past, focus on the individual parts
of City government, reporting the operations of the City in more detail than the
government -wide statements. Both perspectives (government -wide and individual fund)
allow the user to address relevant questions, broaden the basis for comparison, and
enhance the City's accountability.
Government -wide Financial Statements. The government -wide financial statements
are designed to provide readers with a broad overview of the City's finances, in a
manner similar to that of a private -sector business. The statement of net assets
presents information on all of the City's assets and liabilities, with the difference between
the two reported as net assets. Over time, increases or decreases in net assets may
serve as a useful indicator of whether the financial position of the City is improving or
deteriorating. To assess the overall health of the City, other non-financial factors should
also be taken into consideration, such as changes in the City's property tax base and the
condition of the City's infrastructure.
The statement of activities presents information showing how the City's net assets
changed during the fiscal year.. All of the current year's revenues and expenses are
taken into account regardless of when cash is received or paid. Thus, revenues and
expenses are reported in this statement for some items that will only result in cash flows
in future fiscal periods (e.g. uncollected taxes and earned but unused compensated
absences.) Both the statement of net assets and the statement of activities are
prepared utilizing the accrual basis of accounting as opposed to the modified accrual
basis used in prior reporting models.
In the government -wide financial statements, pages 17 through 19, the City is divided
into three kinds of activities:
• Governmental activities- Most of the City's basic services are reported
here, including the police, fire, library, community development, parks and
recreation, municipal court, and general administration. Property and sales
taxes, charges for services, franchise fees, and state and federal grants
finance most of these activities.
• Business -type activities- The City's water and sewer operations are
reported here. Fees are charged to customers to help cover the costs of
providing these services.
• Component units- The city includes two separate legal entities in this
report- the Allen Economic Development Corporation and the Community
Development Corporation. Although legally separate, these component
units are important because the City is financially accountable for them.
Fund Financial Statements. A fund is a grouping of related accounts used to maintain
control over resources that have been segregated for specific activities or objectives.
The City, like other state and local governments, uses fund accounting to ensure and
demonstrate compliance with finance -related legal requirements. All of the funds of the
City can be divided into two categories: governmental and proprietary.
Governmental Funds- These funds are used to account for the majority of
the City's activities, which are essentially the same functions as
governmental activities in the government -wide statements. However,
unlike the government -wide financial statements, governmental fund
financial statements focus on near -tens inflows and outflows of spendable
resources, as well as resources available for future spending at fiscal year
end. These funds are reported using the modified accrual basis of
accounting, which measures cash and all other financial assets that can be
readily converted to cash. When compared with similar information in the
broader government -wide financial statements, readers may better
understand the long-term impact of the government's near-term financing
decisions. Reconciliation is provided that details the relationships or
differences between governmental activities and governmental funds;
reconciliation follows the fund financial statements.
The City maintains several individual governmental funds. Information is
presented separately in the governmental fund balance sheet and in the
governmental fund statement of revenues, expenditures, and changes in
fund balance for the General Fund, the Debt Service Fund, and the Capital
Projects Fund, all of which are considered to be major funds. Data for the
other governmental funds are combined into a single, aggregated
presentation. Individual fund data for each of the non -major governmental
funds is provided in the form of combining statements elsewhere in this
report.
The basic governmental fund financial statements can be found on pages
20 through 26 of this report.
Proprietary funds- The City maintains two different types of proprietary
funds: enterprise funds and internal service funds. Enterprise funds are
used to report the same functions presented as business -type activities in
the government -wide financial statements. The City uses enterprise funds
to account for its water and sewer operations, solid waste collection and
disposal services, drainage operations, and development fees. Internal
service funds are an accounting device used to accumulate and allocate
costs internally among the City's various functions. The City uses its
internal service funds to account for its employee health and dental
insurance program and vehicle replacement. These services have been
included within governmental activities in the government -wide financial
statements as they predominantly benefit governmental rather than
business -type functions.
Proprietary funds provide the same type of information as the government -
wide financial statements, only in more detail. The proprietary fund
financial statements provide separate information for the water and sewer
operations, solid waste collection and disposal services, and development
fees since they are considered to be major funds of the City. The drainage
fund is the only remaining enterprise fund, so it is being presented as a
major fund even though it does not meet the criteria of a major fund
established in Governmental Accounting Standards Board Statement No.
34. All internal service funds are combined into a single aggregated
presentation in the proprietary fund financial statements. Individual fund
data for the internal service funds is provided in the form of combining
statements elsewhere in this report.
The basic proprietary fund financial statements can be found on pages 27
through 31 of this report.
Notes to the Financial Statements. The notes provide additional information that is
essential to a full understanding of the data provided in the government -wide and fund
financial statements. The notes to the financial statements can be found on pages 35
through 62 of this report.
Other Information. In addition to the basic financial statements and accompanying
notes, this report also presents required supplementary information highlighting
budgetary information for the General Fund found on pages 65 through 66 of this report.
The combining statements referred to earlier in connection with non -major governmental
funds and internal service funds are presented following the required supplementary
information. A comparative schedule of capital assets used in the operation of
governmental funds is found on pages 105 through 108.
GOVERNMENT -WIDE FINANCIAL ANALYSIS
As noted earlier, over time net assets may serve as a useful indicator of the financial
position of a government. The assets of the City of Allen exceed the liabilities by
$352,721,649 as of September 30, 2003.
The largest portion of the City's net assets $383,993,899, or 830/6, shown in Table 1
below, is its investment in capital assets (i.e. land, buildings, infrastructure, machinery,
and equipment), less any related debt used to acquire those assets that is still
outstanding. The City uses these capital assets to provide services to its citizens;
consequently, they are not available for future spending. Although the City reports its
capital assets net of related debt, it should be noted that the resources needed to repay
this debt must be provided from other sources, since the capital assets themselves
cannot be used to liquidate these liabilities.
The restricted net asset amount of $23,046 represents resources that are subject to
external restrictions on how they may be used and the remaining balance of
$45,177,220 may be used to meet the government's ongoing obligations to citizens and
creditors.
Table 1
Net Assets
Governmental Business -Type
Activities Activities Total
Current and other assets
$ 64,593,584
$ 14,465,457
$ 79,059,041
Capital assets
307,047,535
76,946,363
383,993,899
$
278,491,104
$
Total Assets
371,641,119
91,411,820
463,052,939
Longterm liabilities
$ 83,544,848
$ 14,414,790
$ 97,959,638
Other liabilities
9605,167
2,766,485
12371,652
Total Liabilities
93150,015
17,181,275
110,331,290
Net Assets:
Invested in capital assets,
net of related debt $ 244,859,181 $ 62,662,202 $ 307,521,383
Restricted - 23,046 23,046
Unrestricted
33,631,923
11,545,297
45,177,220
Total Net Assets
$
278,491,104
$
74,230,545
$
352,721,649
As of September 30, 2003, the City is able to report an overall increase in net assets for
the government as a whole with an increase in the net assets of the governmental
activities that offsets the decrease in net assets for business -type activities.
Table 2 below provides a summary of the City's operations for the year ended
September 30, 2003. Governmental activities increased the City's net assets by
$14,077,783. Business -type activities decreased the City's net assets by $2,104,389
7
due to self-financing of water and sewer capital projects and operational transfers to the
General Fund.
5,232,132
Table 2
5,232,132
Pudic safety
Changes in Net Assets
14,189,983
Governmental Business -Type
14,189,983
Activides Activities
Total
6,653,857
Revenues:
Program Revenues:
Culture & recreation
Charges for services
$ 3,952,613 $ 19,306,503
$ 23,259,116
Oper. Grants & Contributions
1,181,049
1,181,048
Capital Grants & Contributions
5,343,717 1,974,803
7,318,520
General Revenues:
1,475,116
Property taxes
23,033,563
23,033,563
salestax
6,740,270
6,740,270
Franchise texas
3,349,730
3,349,730
Hotel motel bases
221,262
221,262
Other taxes
1,428,274
1,428,274
Interest earnings
1,149,016 205,505
1,354,521
Miscellaneous
800747
800,747
Environmental waste services
Total Revenues $ 47,200,240 $ 21,486,611
$ 68,687,051
Expenses
General government
$
5,232,132
$
5,232,132
Pudic safety
14,189,983
14,189,983
Public works
6,653,857
6,653,857
Culture & recreation
7,821,550
7,821,550
Community development
1,475,116
1,475,116
Grants Administration
340,030
340,030
Interest on long-term debt
4,264,053
4,264,053
Water & sewer
13,068,955
13,058,955
Environmental waste services
3.052,961
3,052,961
Drainage
615,020
615,020
Total Expenses
$
39,976,721
$
16,736,936
$
56,713,657
Increase Net Assets before transfers
$
7,223,519
$
4,749,875
$
11,973,394
Transfers
6,854,264
(8854,264)
Increase in Net Assets
$
14,077,783
$
(2,104,389)
$
11,973,394
Net Assets -October 1, 2002
264,413,321
78334,934
340,748,255
Net Assets -September 30,2003
$
278,491,104
$
74,230,545
$
352,721,649
0
FINANCIAL ANALYSIS OF THE GOVERNMENT'S FUNDS
Governmental Funds'— The focus of the City of Allen's governmental funds is to
provide information on near -tens inflows, outflows and balances of spendable resources.
Such information is useful in assessing the City's financing requirements. In particular,
unreserved fund balance may serve as a useful measure of a government's net
resources available for spending at the end of the fiscal year.
As of the and of the current fiscal year, the City's governmental funds reported combined
fund balances of $50,630,432. Approximately 91.9%, or $46,520,039, constitutes
unreserved fund balances, which are available for spending at the government's
discretion. The remainder of the fund balances are reserved to indicate that it is not
available for new spending because it has already been committed to pay for
encumbrances ($2,730,370), debt service ($1,377,670), and to provide for prepaid items
($2,353). The following charts show the governmental funds' sources of revenue and
expenditure by percentage.
Governmental Funds
Sources of Revenue
12% 12%
5% ■6%
e6%
•11%
■9%
• 39%
Governmental Funds
Expenditures
16% es%
'We
■%■26%
44%
4%
c Net Bontl Proceeds
■ Franchise fees
■ Saks Taxes
■ Property Taxes
■ Service Fees & fires
o htergovernm Mal
Grants, Merest, rise
Nat Transfers YdOdre
■ General Goverrarent
■ Pubic Safety
e Pubic Works
■ GLlure & recreation
Grants Adrm & other
■ Capital Outlay
Debt Service
General Fund and Budgetary Highlights: The General Fund is the chief operating
fund of the City. At September 30, 2003, the General Fund unreserved fund balance
was $7,319,381, while total fund balance reached $7,432,287. As a measure of the
General Fund's liquidity, it may be useful to compare both unreserved fund balance and
total fund balance to total fund expenditures. Unreserved fund balance represents
23.0% of total general fund expenditures, while total fund balance represents 23.3% of
that same amount.
Early in the fiscal year sales tax revenues were not meeting projections, and it became
evident that the slow economic conditions would have an impact on that and other key
revenue sources for the remainder of the year. The original budget projected a
$109,237 increase in fund balance; however, the revised budget indicated the use of
reserves totaling $443,492 would be needed for the shortfall. Therefore, in January,
2003, the City implemented an action plan based nn projected General Fund revenue
shortfalls of approximately $1.2 million. Components of the contingency plan included:
reducing department budgets by approximately 3%
initiating a hiring freeze until April 1 for new non-public safety positions
restricting travel and conferences for staff
In March the projected shortfall was revised to approximately $1.5 million. In order to
offset the additional amount, the hiring freeze was extended to October 1, and was
expanded to include all vacant positions (non-public safety). Also, some additional
operating reductions were taken. By taking this approach, the City was able to maintain
quality services to its citizens, and did not have to lay off any employees.
As a result, total revenue of $32,300,108 was greater than the revised budget of
$32,138,491 and operating expenditures of $31,878,900 were less than the revised
budget of $32,581,983, resulting in an increase to fund balance of $421,208.
Debt Service Fund: The Debt Service Fund has a fund balance of $1,377,670, all of
which is reserved for the payment of debt service. The net increase in fund balance
during the current fiscal year was $336,935.
To take advantage of declining interest rates, on January 1, 2003 the City issued
$2,705,000 in General Obligation Refunding Bonds which were used to refund the City's
callable portion of the 1992 outstanding General Obligation bonds. The City completed
the advance refunding to reduce its total debt service payments for the next four years
and to obtain an economic gain of $131,093.
Special Revenue Fund: The City's Facilities Agreement Fund records the use of funds
received from builders and developers on specific facility agreements. There was little
activity this year as the projects are still in development stages.
Capital Project Funds: The Capital Project funds provide information on bonded and
non -bonded capital projects. These funds cover multi-year budgeted capital projects.
The General Capital Projects fund balance increased by $3,963,913. This fund received
$6,970,569 transferred from other funds to finance capital expenditures.
10
The Street Improvement, Park Improvements, and Library Fund record the use of bond
funds for capital projects. This year the Street and Park Improvement Funds received
$4,020,000 and $3,190,000 respectively from the Spring 2003 G.O. Bond sale. Fiscal
year 2003 highlights can be found in the transmittal letter starting on page viii.
Non -Major Governmental Funds: Special revenue funds that are legally restricted to
expenditures for specific purposes and capital project funds that do not qualify as major
funds are recorded together under this category. One of those funds, Parks and
Recreation Special Revenue Fund, records the City's recreation services. Membership
and user fees are insufficient to cover all expenses; therefore, the General Fund
transferred $1,125,000 to supplement the citizens' recreation activities.
Proprietary Funds: The City's proprietary funds provide the same type of information
found in the government -wide financial statements, but in more detail.
Unrestricted net assets in the Water and Sewer Fund, the Solid Waste Fund, and the
Drainage Fund at the end of the current fiscal year amounted to $9,829,241, $1,049,608,
and $560,188, respectively. The Solid Waste fund had an increase in net assets of
$71,740, while the Water and Sewer fund and the Drainage fund had a decrease in net
assets of $2,212,865 and $69,524, respectively. The Water and Sewer fund transferred
$1,980,358 to the General Fund for operational expenses and contributed $2,534,585
towards the Stacy Road pump station, Ola sewer lift station, waterline replacements and
other various water and sewer capital projects. The Drainage fund contributed $130,694
towards the Mustang Creek drainage capital project.
The 2002-2003 fiscal year represents the first year of the implementation of a water and
sewer rate study that resulted in an overall rate increase of 2.5%. An increase in the
City's cost to purchase water and wastewater treatment resulted in an increase in rates
to the customer. The rate structure continues to reflect the shift to conservation water
rates, which is a year-round inclined block rate system based on increasing charges for
increasing water usage levels. The block system is designed to be revenue neutral in
terms of the 2002-2003 fiscal year, and does not shift the cost burden between
residential and commercial customers. The following two charts show the proprietary
funds' sources of revenue and expenditure by percentage.
Proprietary Funds
Revenue by Activity
0 Water Saba
■ Sewer Charges
O Servbe fees, ht &
■ Sold Waste
■ Drainage
. 0 Dsvebprrent fees
11
Proprietary Funds
Expenses by Activity
e for
■ 29%
■ 4%elm 43%
❑12%
❑2%
Capital Assets
The City's investment in capital assets for its governmental and business -type activities
as of September 30, 2003, amounts to $383,993,899 (net of accumulated depreciation.)
This investment in capital assets includes land and their improvements, buildings,
vehicles, machinery and equipment, park land and facilities, roads and bridges. A 0.2 %
decrease in the business -type activities investment in capital assets was related to
disposals and transfers to other funds. The increase in capital assets in the
governmental activities is primarily attributed to infrastructure reporting.
Major capital asset events during the current fiscal year included the following:
Various water and sewer projects were completed at a cost of $9,203,555;
construction in progress at the close of fiscal year amounted to $543,684.
Drainage projects were completed at a cost of $1,456,260.
A variety of street construction projects in new residential developments
and widening of existing streets began; construction in progress at the and
of the fiscal year reached $11,354,604.
Land was purchased for current and eventual use in the amount of
$673,164. Developers contributed land valued at $729,966.
Public Safety buildings and improvements were completed during the fiscal
year at a cost of $8,945,545 and opened for use.
Architectural and engineering work began on the new central library.
Park and Recreation facilities and land improvements were completed
during the fiscal year at a cost of $20,884,908.
12
The following Table 3 outlines the City's capital assets with additional information in Note
4 on pages 45 through 49 of this report:
Table 3
Capital Assets at Year-end
Net of Accumulated Depreciation
Debt Administration
At September 30, 2003, the City had long-term debt shown in Table 4 below. General
Obligation Bonds totaling $79,243,921 comprises debt backed by the full faith and credit
of the government, $14,525,000 represents bonds secured solely by water and sewer
revenue, and $8,875,000 represents bonds secured by 4A and 4B sales tax revenue.
The contractual obligation pertains to an agreement between the City of Allen, the 4A
and 4B component units and a developer for the construction of Stacy Road. The
remaining other long-term debt relates to capital leases, compensating absences,
interest, discounts and lease payables.
13
Governmental
Business -Type
Activities
Activities
Total
Land
$ 57,215,397
$ 822,643
$ 58,038,040
Buildings
33,625,797
33,625,797
Towers, Tanks & Pump Stations
73,980,157
73,980,157
Improvements
199,773,051
199,773,051
Furniture & Fixtures
586,467
60,073
646,540
Vehicles
2,984,773
319,614
3,304,387
Machinery & Equipment
1,138,988
1,220,192
2,359,180
Other
368,459
368,459
Construction in Progress
11,354,604
543,684
11 898,288
Total
$307,047,536
$ 76,946,363
$383,993,899
Debt Administration
At September 30, 2003, the City had long-term debt shown in Table 4 below. General
Obligation Bonds totaling $79,243,921 comprises debt backed by the full faith and credit
of the government, $14,525,000 represents bonds secured solely by water and sewer
revenue, and $8,875,000 represents bonds secured by 4A and 4B sales tax revenue.
The contractual obligation pertains to an agreement between the City of Allen, the 4A
and 4B component units and a developer for the construction of Stacy Road. The
remaining other long-term debt relates to capital leases, compensating absences,
interest, discounts and lease payables.
13
Table 4
Outstanding Debt at Year-end
Bonds and Other Long Tam Debt
The City's indebtedness decreased by approximately $1,148,533 during the current
fiscal year because current debt service payments were greater than new debt issued.
Governmental activities' total debt increased by 2.5%, business -type activities' debt
decreased by 7.01% and component unit's debt decreased by 10.9%.
The City had authorized but un -issued direct general obligation bonds totaling
$31,985,000 at fiscal year end.
The City's General Obligation, Sales Tax and Water and Sewer Revenue Bond ratings
are listed below:
Moody's Standard
Investors Service & Poor's
General Obligation Bonds Aa3 AA -
Water & Sewer Revenue Bonds A3 A -
Sales Tax Revenue Bonds A3 A -
The City's bonds are insured thus holding a Triple A credit rating from both Moody's and
Standard and Poor's. Additional information on the City's long -tens debt can be found in
Note 5.
14
Govemmeraal
BusY�Type
Gross Barttlad Debt
Activities
ACIMIbe
Cdnydra
Unlb
Tdal
Genal Oblotbn
BCnde
IS
79,243,921
$ 79,243,821
Revenue Bones
Payable
14,525,000
14,525,000
Sales Tex Revenue
BOMB
&875000
8,875,000
Trial Gross forded
MA
$
79,243,921
$ 14,525,000
$
&875,000
$ 102,843,921
OB,er lnng-Tetm Debt
Cdaradual
Obligation
$
578,633
$
578,834
$ 1,157,267
Cdnpensated
Absences
1,820,292
85,a29
1,7(18,121
Was Payable
205,254
208,254
Accreted N.,"a t &
Discounts
1,898,748
(196,039)
1.700.709
Total OtherLong
Term Debt
$
4,300.927
$ (110,210)
$
578,834
$ 4,769,351
Toad
$
83,544,848
$ 14,414,790
$
9.453,834
$ 107,413,272
The City's indebtedness decreased by approximately $1,148,533 during the current
fiscal year because current debt service payments were greater than new debt issued.
Governmental activities' total debt increased by 2.5%, business -type activities' debt
decreased by 7.01% and component unit's debt decreased by 10.9%.
The City had authorized but un -issued direct general obligation bonds totaling
$31,985,000 at fiscal year end.
The City's General Obligation, Sales Tax and Water and Sewer Revenue Bond ratings
are listed below:
Moody's Standard
Investors Service & Poor's
General Obligation Bonds Aa3 AA -
Water & Sewer Revenue Bonds A3 A -
Sales Tax Revenue Bonds A3 A -
The City's bonds are insured thus holding a Triple A credit rating from both Moody's and
Standard and Poor's. Additional information on the City's long -tens debt can be found in
Note 5.
14
ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES
The slow down in the economy affected the city's sales tax receipts. Sales tax growth for
2002-2003 slowed to an annual growth rate of 2.5% above the previous year. A growth
rate of 10% had originally been budgeted for sales tax. For the 2003-2004 budget, a
conservative approach was taken to project the revenue sources. Sales tax was
projected to increase 7.5% above the revised 2002-2003 budget.
Revenue was also down for commercial and multi -family building permits and franchise
fees; however, property valuations continued to increase since residential construction
continued to be strong due to low mortgage interest rates that make housing affordable.
The city saw an increase of 18.6% in the total assessed value for the 2003 budget. For
the 2003-2004 budget, the total valuation increased 8.7% to $4.43 billion. The City
continues to add approximately 5,000 residents per year and issues about 1,400 single
family building permits annually.
The city's property tax rate was reduced to $.562 per $100 valuation for the 2002-2003
budget. A conservative approach to expenditure budgeting resulted in the proposed
budget for 2003-2004; this approach reflects a tax rate of $.561 per $100 valuation. The
city has reduced its tax rate for the eleventh straight year. The portion of the tax rate
contributed to debt service was 36%, which remains consistent with the city's policy of
maintaining the proportion below 40%.
The City's financial policy requires 60 days reserve for General Fund operational
expenses. The 2002-2003 reserve was 73 days, and the projected 2003-2004 budget
reflects a reserve of 70.8 days.
Although there was a slow down in the economy, the City continued with capital
improvement projects being funded from several sources. The City issued $7.2 million of
G.O. bonds for various projects. The City has issued $54 million of the $62.5 million
authorized in the 1999 bond election. A five year debt service analysis was prepared that
shows the City is able to support the remaining $8.5 million of 1999 authorized bonds
plus $1.98 million of the 2002 authorized $19.5 million for a Performing Arts Complex
and $4 million for a Senior Center. The total bond issue planned for 2003-2004 is
approximately $11.7 million.
With the additional debt, the tax rate for Debt Service is expected to remain constant for
the next few years as valuation increases help to generate additional property taxes
dedicated to Debt Service. Cash financing from the General Fund for Capital
Improvement Program (CIP) projects totaled $450,000 in 2002-2003. This amount
represented year end available resources that were unrestricted or unallocated for other
purposes. The 2003-2004 budget does not contain General Fund cash financing for
projects; however, If unallocated resources are available at year end, the City may direct
funds to CIP projects that need additional funding.
An overall rate increase of 2.5% was implemented for water and sewer in 2002-2003.
The long range plan expects annual 6% increases to continue in the future as 1) North
Texas Municipal Water District (NTMWD) proceeds with their water and sewer capital
expansion plans and 2) the City implements conservation water rates. The City cash
15
financed CIP water and sewer projects of approximately $2.5 million in 2002-2003 and
intends to issue $3.4 million in revenue bonds and $3,655,000 in revenue refunding
bonds in 2003-2004. Cash financing of water and sewer projects has reduced working
capital; however, the City will meet bond coverage requirements necessary to maintain a
working capital minimum of 1.2 times the annual debt service obligation.
North Texas Municipal Water District provides landfill services for several cities including
the City of Allen. NTMWD is in the process of constructing a new landfill on Highway
121 in McKinney. Disposal costs are expected to increase at the new landfill in the
future; however, the City's planned $.33 monthly increase in solid waste fees in 2003-
2004 is associated with the Household Hazardous Waste program. Future rate
increases will be associated with disposal costs relative to the McKinney landfill.
A new Employee Classification and Compensation Plan was implemented on April 1,
2003 to ensure that employee salaries remain competitive. Implementation of the plan
cost the City approximately $432,000. The 2003-2004 fiscal year budget provides for a
maximum 4°/, merit increase based upon performance; however, the budget was
prepared with an average merit increase of 30/6 for non-public safety employees and 4
for public safety employees on a step pay grade system.
Request for Information
The financial report is designed to provide our citizens, customers, investors, and
creditors with a general overview of the City's finances. If you have questions about this
report or need any additional information, contact the Finance Department at 305
Century Parkway, Allen, Texas, 75013, or call (972)727-0185.
16
Basic
Financial
Statements
CITY OF ALLEN, TEXAS
STATEMENT OF NET ASSETS
AS OF SEPTEMBER 30, 2003
EXHIBIT 1
LIABILITIES
Accounts payable $
PRIMARY GOVERNMENT
1,396,489 E
4,359,791 E
161,334
GOVERNMENTAL
BUSINESS -TYPE
76,498
COMPONENT
6,105
ACTIVITIES
ACTIVITIES
TOTAL
UNITS
ASSETS
lity
1,057,582
1,057,682
Cash and cash equivalents
E 33,348,788
E 4,739,120 E
38,087,908
$ 4,007,561
Inveabrants
28,981,000
4,094,822
33,085,822
2,000,000
Receivables (net of allmance for uncollectibles)
2,285,771
2,995,776
5,281,547
1,227,876
Internal balances
(106,260)
106,260
1,162252
8260,820
Prepaid and other assets
2,353
76,446,280
2,363
89,698,818
Inventories
TOTAL LIABILITIES
18,115
18,115
110,331290
Restricted cash and cash equivalents
NET ASSETS
2,466,564
2,466,064
Capital assets:
Invested in capital assets (net of related debt)
244,859,181
62,662202
307,521,383
Non -depreciable
68,570,001
1,366,327
69,936,328
4,738202
Depreciable(net of depreciation)
238,477,635
75,580,036
314,057,571
2,504.465
Defend charges
71,931
44,800
116,731
45,177220
TOTAL ASSETS
$ 371,641,119
$ 91,411,820 $
463,052,939
$ 14,478,104
LIABILITIES
Accounts payable $
2,963,322 $
1,396,489 E
4,359,791 E
161,334
Accrued labilities
2,155,305
76,498
2,231,803
6,105
Accrued interest payable
332,716
235,936
568,652
37,362
lity
1,057,582
1,057,682
revenue
Defened revenue
Deferred
4,065,889
4,065,889
Retainage payable
87,935
87,935
16,974
Nwn current liabilities:
Due Whin we year
7,098,568
1,162252
8260,820
978,634
Due in more than ane year
76,446,280
13252,538
89,698,818
8,475,000
TOTAL LIABILITIES
93,150,015
17,181275
110,331290
9,675,409
NET ASSETS
Invested in capital assets (net of related debt)
244,859,181
62,662202
307,521,383
11.632,333)
ResNcted for
Debt M.
23,046
23,046
Unrestricted
33,631,923
11,545,297
45,177220
6,435,028
TOTAL NET ASSETS E
278,491,104 E
74.230,545 E
362,721,649 E
4,802,695
The Notes to Financlal Statements
are an Integral part of (his statement.
17
CITY OF ALLEN, TEXAS
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED SEPTEMBER 30, 2003
The Notes to Financial Statements
are an integral part of this statement.
18
General revenues:
Taxes:
Property taxes, levied for general purposes
Sales taxes
Franchise taxes
Hotel motel taxes
Othertaxes
Interest on investments
Miscellaneous
Transfers
Total general revenues and transfers
CHANGE IN NET ASSETS
NET ASSETS, beginning of year
NET ASSETS, end of year
Program Revenues
Charges for
Operating Grants
Capital Grants
Expenses
Services
and Contributions
and Contributions
Functions/Program Activities
PRIMARY GOVERNMENT:
Governmental Activities:
General government
$ 5,232,132 $
215,689 $
177,574 $
Public safety
14,189,983
575,140
7,733
Publicworks
6,653,857
236
555,089
2,425,000
Culture and recreation
7,821,550
1,603,568
58,920
Community development
1,475,116
1,557,980
86,892
Grants administration
340,030
294,840
2,918,717
Interest on Long-term Debt
4,264,053
Total governmental activities
39,976,721
3.952,613
1.181.048
5.343.717
Business -type Activities:
Water and sewer
13,068,955
15,375,794
1,974,803
Environmental waste services
3,052,961
3,139,245
Drainage
615.020
791.464
Total business -type activities
16.736,936
19,306,503
1,974,803
TOTAL PRIMARY GOVERNMENT
$ 56.713.657 $ 23.259.116 $
1.181.048 $
7.318.520
COMPONENT UNITS:
Allen Economic Development Corporation
$ 2,406,449
Allen Community Development Corporation
4,228.494
TOTAL COMPONENT UNITS
$ 6.634.943 $
$
$
The Notes to Financial Statements
are an integral part of this statement.
18
General revenues:
Taxes:
Property taxes, levied for general purposes
Sales taxes
Franchise taxes
Hotel motel taxes
Othertaxes
Interest on investments
Miscellaneous
Transfers
Total general revenues and transfers
CHANGE IN NET ASSETS
NET ASSETS, beginning of year
NET ASSETS, end of year
EXHIBIT 2
Net (Expense) Revenue and
Changes in Net Assets
Primary Government
Govemmental Business - Type COMPONENT
Activities Activities TOTAL UNITS
$ (4,838,869) $
(13,607,110)
(3,673,532)
(6159,062)
169,756
2,873,527
(4,264,0531
(29,499,343)
$ (4,838,869) $
(13,607,110)
(3,673,532)
(6,159,062)
169,756
2,873,527
(4,264,053)
(29499,343)
4,281,642 4,281,642
86,284 86,284
176.444 176.444
4,544,370 4,544.370
$(29.499.3431 $ 4.544.370_ $ (24.954.9731 $
$ $ $ $ (2,406,449)
(4,228,494)
$ $ $ $ (6.634.9431
23,033.563
23,033,563
6,740,270
6,740,270
6,740,270
3,349,730
3,349,730
221,262
221,262
1,428,274
1,428,274
,
1,149,016
205,505
1,354,521
76,535
800,747
800,747
8,778
6.854,264
(6,854,264)
43 577.126
(6,648,759)
36 928.367
6,a25.583
14,077,783
(2,104,389)
11,973,394
190,640
264 413,321
76 334.934
340,748,255
4,612,055
$ 278.491.104_
$ 74.230.545 $
352.721,649
_ $ 4.802.695
19
CITY OF ALLEN, TEXAS
BALANCE SHEET
GOVERNMENTAL FUNDS
SEPTEMBER 30.2003
The Notes to Financial Statements
are an integral part of this statement.
20
GENERAL
DEBT
FACILITIES
CAPITAL
GENERAL
SERVICE
AGREEMENT
PROJECTS
ASSETS
Cash and cash equivalents
$
3,215,201
$ 380,685 $
2,177,037 $
6,465,496
Investments
5,000,000
1,000,000
1,997,000
8,000,000
Receivables, net of allowances for
uncoil
Ad valorem taxes
149,776
88,496
Sales taxes
1,213,740
Accounts receivable
Accrued interest
29,882
1,867
9,325
47,507
Other
426,787
2,374
Special assessments
Due from other funds
400,487
2,000,000
450,000
Prepaid Items
2,353
TOTAL ASSETS
$
10,438,226
$ 1A73,422 $
6,183,362 $
14,963,003
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable
$
875,117
$ $
$
372,742
Accrued liabilities
1,530,559
Accrued interest payable
7,256
Retainage payable
606
34,267
Due to other funds
450,487
00.000
Deferred revenue
149,776
88,496
4,065,889
TOTAL [LIABILITIES
3,005,939
95,752
4,066,495
807,009
FUND BALANCES
Reserved for encumbrances
110,553
79,749
Reserved for debt service
1,377,670
Reserved for prepaid Items
2,353
Unreserved:
,
Designated for capital projects
14.155,9W
Designated for court security and technology
185,857
Designated for library services
4,128
Designated for police services
6,785
Designated for fire services
2,913
Undesignated
7,119,698
2,037,118
TOTAL FUND BALANCES
7,432,287
1,377,670
2,116,867
14,155,994
TOTAL LIABILITIES AND FUND BALANCES
$
10,438,226
$ 1,473,422 $
6,183,362 $
14,963,003
The Notes to Financial Statements
are an integral part of this statement.
20
EXHIBIT 3
$ 4,710,929 $ 4,793,523 $ 5,268,068 $ 3,480,910 30,491,849
5,000,000 3,000,000 2,000.000 1,000,000 26,997,000
238,272
1,213,740
24,552 24,552
30,144 14,105 8,077 2,048 142,955
429,161
208,796 208,796
2,850,487
2,353
$ 9,741,073 $ 7,807,628 $ 7,276,145 $ 4,716,306 62.599,185
$ 1,485,018 $
2,197 $ 107,289 $ 83,246 $
2,925,609
OTHER
TOTAL
STREET
PARK
LIBRARY
GOVERNMENTAL
GOVERNMENTAL
IMPROVEMENTS
IMPROVEMENTS
FUND
FUNDS
FUNDS
$ 4,710,929 $ 4,793,523 $ 5,268,068 $ 3,480,910 30,491,849
5,000,000 3,000,000 2,000.000 1,000,000 26,997,000
238,272
1,213,740
24,552 24,552
30,144 14,105 8,077 2,048 142,955
429,161
208,796 208,796
2,850,487
2,353
$ 9,741,073 $ 7,807,628 $ 7,276,145 $ 4,716,306 62.599,185
$ 1,485,018 $
2,197 $ 107,289 $ 83,246 $
2,925,609
223,501
39,225
1,793,285
7,256
1,377,670
9,435 43,627
87,935
2,000,000
2,850,487
4,304.161
3,708,519
11,632 107,289 166,098
11,968,733
2,176,624
62,292
168,058
133,094
2,730,370
1,377,670
2,353
14,155,994
185,857
4,128
6,785
2,913
3,855,930
7,733,704
7,000,798
4,417,114
32,164,362
6,032,554
7,795,996
7,168,856
4,550,208
50,630,432
$ 9,741,073 $
7,807,628 $
7,276,145 $
4,716,306 $
62,599,165
21
CITY OF ALLEN, TEXAS
RECONCILIATION OF THE GOVERNMENTAL FUNDS
STATEMENT OF NET ASSETS TO THE BALANCE SHEET
SEPTEMBER 30, 2003
EXHIBIT 4
Total fund balances - governmental funds
$ 50,630,432
Amounts reported for governmental activities in the statement of net assets
are different because:
Capital assets used in governmental activities are not current financial resources
and therefore are not reported in the governmental funds balance sheet.
307,047,536
Costs associated with the issuance of governmental long term debt are expensed
when incurred in the fund statements and capitalized and amortized over the
life of the debt in the government -wide financial statements.
71,931
Interest payable on long term debt does not require current financial resources,
therefore interest payable is not reported as a liability in the governmental
funds balance sheet.
(325,460)
Internal service funds are used by management to charge the cost of certain
activities, such as insurance and Fleet management, to individual funds. The
assets and liabilities of the internal service funds are net of the amount allocated
to business -type activities and capital assets.
4,373,241
Revenues earned but not available within sixty days of the year end are not
recognized as revenue on the fund financial statements.
238,272
Long-term liabilities, including bonds payable are not due and payable in the
current period and therefore are not reported in the fund financial statements.
(83,544,848)
Net assets of governmental activities
$ 278,491,104
The Notes to the Basic Financial Statements
are an integral part of this statement. 22
CITY OF ALLEN
23
CRY OF ALLEN, TEXAS
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
GOVERNMENTALFUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2003
The Notes to Financial Statements
we an integral pan of this statement.
24
GENERAL
DEBT
FACIUTIES
CAPITAL
GENERAL
SERVICE
AGREEMENT
PROJECTS
REVENUES
Ad valorem taxes, Penalties and interest
$ 14,662,974 S
8,598,834 $
$
Franchise taxes
3,349,730
Municipal sales tax
6,740,270
License, permits and fees
1,364,939
Charge for services
988,076
Fines
1,428,274
Gifts and contributions
137,207
86,892
48,100
Special assessments
Hotal / motel fees
Recreation fees
Intergovernmental
794,840
2,662,487
Interest earned
200,947
67,398
93,208
207,184
Miscellaneous
478.377
442
Total revenues
30,165,634
8.666,232
180.100
2.918,213
EXPENDITURES
Current
General government
5,184,152
194,622
Public safety
13,551,576
Public works
2,444,021
Culture and reoreatton
5,026,395
Community development
1,492,952
Grants administration
1,025,141
Capital outlay
86,892
5,730,247
Debt service:
Principal retirement
660,771
4,370,000
Interest and fiscal charges
94,050
4,018,210
Total expenditures
29,479,058
8.358,210
86.892
5,924,869
Excess (deficiency) of revenues
mw (under) a penditures
686,576
278.022
93.208
(3,006,656)
OTHER FINANCING SOURCES (USES)
Proceeds from refunding bands
2,712,759
Proceeds from sale of bands
Proceeds from capital lease obligation
6,789
Payment to refund bond escrow Want
(2,653,846)
Transfers from other funds
2,127,685
6,970,559
Transfers to other funds
(2,399,842)
Total other financing sources (uses)
(265,368)
58,913
6.970,569
NET CHANGE IN FUND BALANCES
421,208
336,935
93,208
3,963,913
FUND BALANCES, BEGINNING OF YEAR
7,011,079
1,040.735
2.023,659
10,192.081
FUND BALANCES, END OF YEAR
$_ 7,432,287 $
1,377,670 $
2,116,867 $
14,155,994
The Notes to Financial Statements
we an integral pan of this statement.
24
EXHIBIT 5
(8,157,201) (1,951,367) (422,926) (942,028) (13 422,372)
OTHER
TOTAL
STREET
PARK
LIBRARY
GOVERNMENTAL
GOVERNMENTAL
IMPROVEMENTS
IMPROVEMENTS
FUND
FUNDS
FUNDS
$
$ $
1,125,000
10,223,254
$ 23,281.808
(155,220)
(81,975)
!731,953)
(3.368,990)
3,349,730
3,034,780
(81.975)
393.047
14,129,966
6,740,270
(4,137,201)
1,083,413
(504,901)
(548,981)
1,364,939
10 159,755
6,71Z583
7.673,757
5,099,189
988,076
$ 6,032,554
$ 7.795,996
$ 7,168,856
1,428,274
$ 50,630,432
58,920
331,119
317,602
317,602
221,262
221,262
1,599,598
1,599,598
3,457,327
184,464
119,568
131,153
66,696
1,070,618
372,462
851,281
184,464
119.568
131,153
2,636,540
45.001,904
26,200
5,404,974
13,077
13,564,653
35,347
720
2,480,088
81,019
6,066
2,951,217
8,064,697
1,492,952
1,025,141
8,306,318
1,989,916
548,013
587,354
17,248,740
5,030,771
4,112,260
8,341,665
2,070,935
554,079
3,578,568
58,424,276
(8,157,201) (1,951,367) (422,926) (942,028) (13 422,372)
tti
2,712,759
4,020,000
3,190,000
7,210,000
6,789
(2,653.846)
1,125,000
10,223,254
(155,220)
(81,975)
!731,953)
(3.368,990)
4,02D,000
3,034,780
(81.975)
393.047
14,129,966
(4,137,201)
1,083,413
(504,901)
(548,981)
707,594
10 159,755
6,71Z583
7.673,757
5,099,189
49 922,838
$ 6,032,554
$ 7.795,996
$ 7,168,856
4,550,208
$ 50,630,432
tti
CITY OF ALLEN, TEXAS
RECONCILIATION OF THE STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES OF
GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
YEAR ENDED SEPTEMBER 30, 2003
EXHIBIT 6
Net change in fund balances- total governmental funds
$ 707,594
Amounts reported for governmental activities in the statement of activities
are different because:
Governmental funds report capital outlays as expenditures. However,
in the statement of activities the cost of those assets is allocated over
their estimated useful lives and reported as depreciation expense. This is
the amount of capital assets recorded in the current period.
18,577,362
Governmental funds do not recognize assets contributed by developers. However,
(2,057,961)
in the statement of activities the fair market value of those assets are
recognized as revenue, then allocated over their estimated useful lives and
reported as depredation expense.
2,418 717
Depredation expense on capital assets is reported in the statement of activities but
does not require the use of current financial resources. Therefore, depreciation
10,413
expense is not reported as expenditures in the governmental funds.
(5,453,903)
The proceeds from issuance of long term debt (e.g. bonds) provides current financial
resources to governmental funds ($9,929,548), while the repayment of the principal of
long-term debt consumes the current financial resources of governmental funds,
including amounts paid to refund bond escrow agents ($ 7,800,743). Neither transaction,
however, has any effect on net assets. Also, governmental funds report the effect of
issuance costs, premiums, discounts, and similar items when debt is first issued,
whereas the amounts are deferred and amortized in the statement of activities ($70,844).
This amount is the net effect of these differences in the treatment of long-term debt and
related items.
(2,057,961)
Current year changes in long term liability for compensated absences do not require
the use of current financial resources; therefore, are not reported as expenditures
in governmental funds.
34,457
Current year changes in accrued interest payable do not require the use of current
financial resources; therefore, are not reported as expenditures in governmental funds.
10,413
Internal service funds are used by management to charge the costs of certain
activities, such as insurance and fleet management, to individual funds. The
net revenue of the internal service funds is reported with governmental activities
net of amount allocated to business -type activities.
322,399
Current year accretion on capital appreciation bonds is not reflected in the fund financial
statements, but is shown as an increase in the accreted interest on the government -wide
financial statements. Payments of accreted interest on capital appreciation bonds are
expenditures In the fund financial statements, but are shown as reductions in long-term
debt in the government -wide financial statements.
(233,050)
Certain revenues in the government -wide statement of activities that do not
provide current financial resources are not reported as revenue in the
governmental funds.
(248,245)
Change in Net Assets of Governmental activities
$ 14,077,783
The Notes b the Basic Financial Statements
are an integral pan of Mis statement. 26
111M.I ....
Aaounb payable
Accred liabllkm
Incunod but nal repold clams
Peyeble Sam restricbtl meet:
Revenue bade payable
Accmd intermt Paydle
UBlitydeposit
Tow wnent liabilifim
NON-CURRENT LIABILITIES
R.- bond: P-IMMa
Aamd aamPareatd absences
Tota n.u-t Iiabllidm
TOTAL LIABILITIES
NET ASSETS
Invutsd In capital asset, net of named debt
Resbicttl M
Revnue bond Principal and inbrmt
Unrestnc
TOTAL NET ASSETS
Th. Notes to Finaradal Statement
we n Integral Part of 0us stewnnt.
6 1,82,582 9
157,652 $
16,225 6
1,388140 $
W.113
EXHIBIT 7
CITY OF ALLEN, TEXAS
5,025
7840
STATEMENT OF NET ASSETS
M.om
1,10,00o
PROPRIETARY FUNDS
235106
235,838
SEPTEMBER 30,2003
1,057,582
106/,582
BUSINESS -TYPE ACTIVITIES
3.721,362
ENTERPRISE FUNDS
21,20
3,916,485
pOVERNMENTAL
ACTIVITIES
WATER AND
SOLID
76,666
INTERNAL SERVICE
3,404
SEWER
WASTE
DRAINAGE
TOTAL
FUNDS
ASSETS
13,258615
5,771
3,404
19284,70
CURRENT ASSETS
$ 3,449,5/7 $
7",180 $
545,359 $
4,739,120 6 2,856,939
Cash and cash equivalents
4,004,822
179,814
7,4,656
4.096,822
1,894,00
Inveatmants
61,03,086
Re ablm, net of allowance tar uncdecfiblm:
2,454,861
335,151
38.483
2,828,495
18,707
Accounts
16,986
4,479,501
16,360
8,588
Axmad intoner
1481917
1,088,243 5
149,917
74,124,285 $
OMr
18,115
18,115
Inventaiaa
Reablctd cash and cash equivalents
2466 584
z •c'�
Tatal cunenl assets
12,WD,W3
1228,262
584,802
14310.397
4,879,234
CAPITAL ASSETS
822,843
88 643
Land
Tea., and Pump data.
983W,170
08038
0,818m8
1,953,345
Molar vahiclm
782.109
1,342,942
40,448
1,40
50,353
419,007
BW,910
1,7,399
20,201
Machine, and equipmnt
174
Fumibn and fikure
89.174
543,684
Caabucfia in program
543,684
Tata capita masts
99,910,722
45'm
1,039,308
100,886,018
2,153,548
Lw: accumulated d"miadn
(23823,475)
(1.263)
(218,917)
(7,4049,655)
(1249,888)
Capiw neat, net of accumulated dWroaadm
78087,247
38,635
MABt
76,946,3fi3
03,548
DEFERRED CHARGES
40,00
B0
Bok imunu cost, net of.,ati afia
TOTAL ASSETS
S 88,632,30 $
1,287,887 8
1,405,323 $
91,305,580
S 5,782,782
111M.I ....
Aaounb payable
Accred liabllkm
Incunod but nal repold clams
Peyeble Sam restricbtl meet:
Revenue bade payable
Accmd intermt Paydle
UBlitydeposit
Tow wnent liabilifim
NON-CURRENT LIABILITIES
R.- bond: P-IMMa
Aamd aamPareatd absences
Tota n.u-t Iiabllidm
TOTAL LIABILITIES
NET ASSETS
Invutsd In capital asset, net of named debt
Resbicttl M
Revnue bond Principal and inbrmt
Unrestnc
TOTAL NET ASSETS
Th. Notes to Finaradal Statement
we n Integral Part of 0us stewnnt.
6 1,82,582 9
157,652 $
16,225 6
1,388140 $
W.113
55,252
16,221
5,025
7840
M.om
1,10,00o
1,10,00
235106
235,838
1,057,582
106/,582
3.721,362
173,673
21,20
3,916,485
388733
13,178,01
13,178,01
76,666
5,771
3,404
Sun
13,258615
5,771
3,404
19284,70
16,978977
179,814
7,4,656
17181,85
399,733
61,03,086
38835
Bm,481
62,662,m2
WG, 48
23 0a8
8829,241
1049808
00,188
23,046
11439,037
4,479,501
$ 71,655,373 S
1,088,243 5
1,30,668 $
74,124,285 $
5,383,049
27
CITY OF ALLEN, TEXAS
RECONCILIATION OF THE STATEMENT OF NET ASSETS
OF PROPRIETARY FUNDS TO THE
GOVERNMENT -WIDE STATEMENT OF NET ASSETS
AS OF SEPTEMBER 30, 2003
Amounts reported for business -type activities in the statement of net
assets are different because:
EXHIBIT 8
Total net assets per statement of net assets $ 74,124,285
Internal service funds are used by management to charge the costs of fleet
management, property liability loss, medical and dental insurance, and health claims
to individual funds.
The assets and liabilities of internal service funds are induced in the governmental
activities in the government -wide statement of net assets. The amount shown is
allocated to business -type activities as the net receivable from internal service funds
which is reported within business -type activities. 106,260
Total net assets of business -type activities
The Notes to Financial Statements
are an integral part of this statement.
28
$ 74,230,545
The Notes to Financial Statements
are an integral pat of this statement.
29
EXHIBIT 9
CRY OF ALLEN, TEXAS
STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN NET ASSETS
PROPRIETARY FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2003
BUSINESS -TYPE ACTIVITIES
ENTERPRISE FUNDS
GOVERNMENTAL
ACTIVITIES
WATER AND
SOLID
INTERNAL SERVICE
SEWER
WASTE
DRAINAGE
TOTAL
FUNDS
OPERATING REVENUES
Charges fa sales and services:
$
$
E
10,682,260 $
Water sales E
10,682,260
3,939,556
Sawa charges
3,939,556
264,2,40
Connection fees
264,240
3,073,816
3,073,916
Garbage colles9ons
276,036
58.147
334,183
3,574,347
Service charges
730,986
730,986
Drainage fees
213,702
65,329
2,331
281,362
33,598
Miscellanews
Total operating revenues
15,375,784
3139,245
791,464
19,306,503
3607,945
OPERATING EXPENSES:
2,090,224
163,794
209,599
2,483,617
57,339
Personal services
Cwkwami sendees
7,363,688
2,843,969
118,642
10,327,289
3,011,365
Maintenance
189,671
131,205
320,876
Supplies
95,242
5,463
9,374
110,079
Depreciation and amati}ation
2,876,140
7,263
92,931
2,776,334
193,500
Other
16,301
32,472
52,269
101,042
Total operabng expenses
12,431,266
3052,981
615.020
16.098247
3262,204
OPERATING INCOME
2,944,528
86,284
178444
3,207,256
345.741
NON-OPERATING REVENUES (EXPENSES)
188,009
10,061
7,435
205,505
78,398
Interest incase
(743,949)
(743,949)
Intereslexpense
4,520
Gain on disposal of capital assets
860.557
880,557
DevsWrnent fees
Total noncperaling revenues
324,617
10,061
7,435
342,113
82,918
INCOME BEFORE CAPITAL CONTRIBUTIONS
1631879
3549369
428.659
AND TRANSFERS
3.269,145
96,345
CAPITAL CONTRIBUTIONS AND TRANSFERS
1,094,248
Capital contributions
1,094,248
27,536
12,549
40,085
Tranalas from otMr funds
Transfers to other funds
(6603792)
7154
(253403)
(6894349)
Total capital contributions and transfers
(5482010)
24605
(253403)
(5760018)
CFW4GE IN NET ASSETS
(2,212,865)
71,740
(69,524)
2.210,649)
428,659
NET ASSETS, BEGINNING OF YEAR
73868.238
1,016,503
1.450193
78334.934
4954,390
NET ASSETS, END OF YEAR
E 71,655,373
$ 1,088,243 $
1,380,668
$ 74,124,285
$ 5,383,049
The Notes to Financial Statements
are an integral pat of this statement.
29
CITY OF ALLEN, TEXAS
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN NET ASSETS OF PROPRIETARY FUNDS
TO THE STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED SEPTEMBER 30, 2003
Amounts reported for business -type activities in the statement of activifles
are different because:
EXHIBIT 10
Net change in fund net assets- total propnety funds $ (2,210,649)
Internal service funds are used by management to charge the costs of fleet
management, property liability loss, medical and dental insurance, and health claims
to individual funds.
The net expenses of certain activities of internal service funds is reported within
business -type activities. 106,260
Change in net assets of business -type activities
The Notes to Financial Statements
are an integral part of this statement.
30
$(2,104,389)
C.ah lid M dims
Net cash provided by( ... d in) el.fini, ectiNtiea
CASH FLOWS FROM NON -CAPITA.
FNANCNGACTWMES
To nefm hom oMerNMn
Transfxs to olhx lundv
Had cash wind In.n-cep8ei finercinq ectiMi.
4293.396 (364.618) 243.269 432/.047
2],536
12,549
(1,984,000)
EXHIBIT 11
CRY OF ALLEN, TEXAS
(3]150
(253.4831
18.891.3491
ENTERPRISE FUNDS
8..6051
(2534831
(8854.264)
STATEMENT OF CASH FLOWS
880.667
640'657
f 2.859P39
PROPRIETARY FUNDS
12.384.9371
(45.8981 1191,4311 (2SOS255)
FOR THE YEAR ENDED SEPTEMBER 30, 2(103
(114,341)
(24.641)
(131,964)
94.231
BUSINESS -TYPE ACTIVITIES
4378
1,617
(96318511)
ENTERPRISE FUNDS
5,131
GOVERNMENTAL
0.605)
5,401
ACTIVITIES
WATER AND SOLID
98,641
INTERNAL SERVICE
833.8911
SEWER WASTE DRAINAGE
TOTAL
FUNDS
CASH FLOWS FROM OPERATING ACTNRIES
S 15,11],83] 3 2,6µ271 $ 789,987 $
18,752.95
$
Oaah recaivad hom c.bm..
267.]31
0.293.396
3,611,125
Cash received from ha.ac5oes wiM owner funds
(2,085,080) (161,922) (211,204)
(2,458318)
(57439)
Gash lid b employe. for services
Ciahlidiar9oodeendaervic.
(8,]39,351) (2,991,967) (335,514)
(12.088,832)
(2A2,076)
C.ah lid M dims
Net cash provided by( ... d in) el.fini, ectiNtiea
CASH FLOWS FROM NON -CAPITA.
FNANCNGACTWMES
To nefm hom oMerNMn
Transfxs to olhx lundv
Had cash wind In.n-cep8ei finercinq ectiMi.
4293.396 (364.618) 243.269 432/.047
2],536
12,549
(1,984,000)
40.645
(8603.]92)
(3]150
(253.4831
18.891.3491
(8576356)
8..6051
(2534831
(8854.264)
CASH FLOWS FROM CAPITAL AND
(4,064,BZ2)
(1,984,000)
RELATED FNANCWG ACTNRIES
Pdnciyal lM on re.nue bond m aurides
(1.164,064)
(1,100,000)
Interest paid
(761,014)
(751.044)
Acguisdian of pM1..eb
(11364A50)
(45,888) (194,431) (1,62A,in)
Conona.b.. Be. de.loln
880.667
640'657
f 2.859P39
Nat cash led in .,M1 and related fil.ial.cdiities
12.384.9371
(45.8981 1191,4311 (2SOS255)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of imas4nent securities
Prx.da tram da, vele and maturities
o(inv.hnem
Interest on inv.nandaimenM
Net cash provided by investing activi0.
NET INCREASE (DECREASE)
N CASH AND CASH EOUNAtENTS
CASH AND CASH EOUNALENTS, BEGNNNG OF YEAR
CASH AND CASH EQUIVALENTS, END OF YEAR
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED BY (USED N) OPERATNG ACTIVITIES
Net operating I..(baa)
Adlusba.nis b reconcile olrating imom. (lass)
W net cash provided by (used in) operating attAft:
Depreciation end emo Ration intens
Cheng in sets and liabild.:
(fiiona ) in accounts receivable
(bore..) In other mc.inables
(brnase) d.r.ase in Inv.nion.
bc.. (decro.e) In accounia payable
bare.. (desr..a) I..carued liabilities.
Increases (deomme) in comlesatnd aba.ncna
bon... in utility deslaib
Inas. (dxnion.) in retaining. lyebl.
Tobi edlashlnb
NN cash pnvided by (.ed In) Olndng ao4viti.
140144ASH FNANCNG ACTNRES:
ConVbut.na of fixed .seta from da ndal-
Reconodudion W bbl c.eh to me.btsmem of nat.aets:
C.h end cash ... hadi l-cunent
R.Mcted cash and cash eeulwlan6
CASH AND CASH EQUIVALENTS. END OF YEAR
The Nobs to Financial Statements
are an integral pat of Nie shtanerlL
(783381
633A72
(640.160)
(640.1601
(4,094,822)
(4,064,BZ2)
(1,984,000)
6,566,864
6,566,808
2,&55,640
201.506
10.061 7A35 219.002
]6.0]4
2.8]3.490
10.061 7.435 3690.986
]1].084
(1.9]4.30])
(3701640)
(19].138)
(2.541A97)
710498
7890448
1114244
742AN
9747.181
2146543
8 5.916.141 $
744.184 S
545.364 8
7.2(15.884
f 2.859P39
S 2914.528 $ 86.284 $ 176444 $ 3.207.258 5 345.741
2,876,140
736G
92,931
2.7]6,334
193500
(267.257)
(197,825)
(1,471)
(457,259)
(91,149)
(�1")
26,648
7,648
(114,341)
(24.641)
(131,964)
94.231
(969,745)
4378
1,617
(96318511)
5,131
1472
0.605)
5,401
98.041
98,641
833.8911
(233.891)
1348.868
1395.9021
68.825
1 819.791
267.]31
0.293.396
(369.6181
243264
4337.641
633.472
$ 1.094346 $_$_3 1.094.248 $
$ 3449,677 $ 744,184 $ 5451359 8 2.7739.10 8 2,858,939
2458.564
3 5.918.141 $ 741184 $ 645,39 S 7.205.684 $ 2.858.939
31
CITY OF ALLEN, TEXAS
EXHIBIT 12
COMPONENT UNITS
STATEMENT OF NET ASSETS
SEPTEMBER 30, 2003
ALLEN
ALLEN
ECONOMIC
COMMUNITY
DEVELOPMENT
DEVELOPMENT
CORPORATION
CORPORATION
TOTALS
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$ 2,205,943
$ 11801,618
$
4,007,561
Investments
2,000,000
2,000,000
Sales tax receivable
606,870
606,870
1,213,740
Accounts receivable
1,039
1,039
2,078
Accrued interest receivable
12,058
12,058
Total current assets
2,813,852
4,421,585
7,235,437
CAPITAL ASSETS
Land
4,569,624
4,569,624
Furniture 8 Fixtures
74,028
74,028
Buildings and improvements
2,942,599
2,942,599
Construction in Progress
168,578
168,578
Total exploit assets
7,754,829
7,754,829
Less: accumulated depreciation
(512,162)
(512,162)
Capital assets, net of accumulated depreciation
7,242,667
7,242,667
TOTAL ASSETS
$ 10,056,519
$ 4,421,585
$
14,478,104
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES
Accounts payable
$ 71,706
$ 89,628
$
161,334
Accrued and other liabilities
6,105
6,105
Accrued interest payable
37,362
37,362
Retainage payable
16,557
417
16,974
Contractual obligations
289,317
289,317
578,634
Revenue bonds payable
400,000
400,000
Total current liabilities
383,685
816,724
1,200,409
NON-CURRENT LIABILITIES
Revenue bonds payable
8,475,000
8,475,000
Total noncurrent liabilities
8,475,000
8,475,000
TOTAL LIABILITIES
383,685
9,291,724
9,675,409
NET ASSETS (ACCUMULATED DEFICIT)
Invested in capital assets, net of related debt
7,242,667
(8,875,000)
(1,632,333)
Unrestricted
2430,167
4,004,861
6,435,028
TOTAL NET ASSETS
(ACCUMULATED DEFICIT)
$ 9,672,834
$(4,870,139)
$
4,802,695
The Notes to Financial Statements
are an integral pan of this statement.
32
CITY OF ALLEN, TEXAS EXHIBIT 13
STATEMENT OF ACTIVITIES
COMPONENT UNITS
FOR THE YEAR ENDED SEPTEMBER 30 2003
Net (Expense) Revenue and
Program Revenues Changes in Net Assets
COMPONENT UNITS
Funcaon/Pmgram Activities
COMPONENT UNITS
Allen Economic
Development Corporason
Allen Community
Development Corporation
TOTAL COMPONENT UNITS
ALLEN ALLEN
Operating ECONOMIC COMMUNITY
Charges for Grants and DEVELOPMENT DEVELOPMENT
Expenses Services Contributions CORPORATION CORPORATION TOTALS
$ 2,406,449 $ $
$ (2,406,449) $ $
(2,408,449)
4,228,494
(4,228,494)
(4,228,494)
$ 8.834,943 $ $
$ (2,608.448)
$ M.228.414) $(8.834.943)
General revenues:
Sales taxes
It 3,370,135
E 3,370,135 9
6,740,270
Interest on investments
17,888
58,867
78,535
Miscellaneous
8,778
8,778
Total general revenues and transfers 3,396,581
3,429,002
6,825,583
Change in Net Assets
890,132
(799,492)
190,840
NET ASSETS, beginning of year
8,662,702
(4,070,847)
4,612,055
NET ASSETS, end of year
$ 9.872,834
E (4,870.1391 $
4.602,695
The Notes to Financial Statements are
an integral part of this statement. 33
CITY OF ALLEN
Q
Notes to
Financial
Statements
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General Statement
The City of Allen (the "City') was incorporated in 1953, under the provisions of Chapter 11, Title 28,
Texas Revised Civil Statutes of 1925. In 1979, the City adopted a charter making it a home rule city
operating under a Council -Manager form of government. The City provides such services as are
authorized by its charter to advance the welfare, health, comfort, safety and convenience of its
inhabitants.
The accounting and reporting policies of the City relating to the funds included in the accompanying
basic financial statements conform to accounting principles generally accepted in the United States of
America applicable to state and local governments. Generally accepted accounting principles for local
governments include those principles prescribed by the Governmental Accounting Standards Board
(GASB), the American Institute of Certified Public Accountants in the publication entitled Audits of State
and Local Governmental Units and by the Financial Accounting Standards Board (when applicable). As
allowed in Section P80 of GASB's Codification of Governmental Accounting and Financial Reporting
Standards, the City has elected not to apply Financial Accounting Standards Board Statements and
Interpretations, Accounting Principles Board Opinions, and Accounting Research Bulletins of the
Committee of Accounting Procedure issued after November 30, 1989. The more significant accounting
policies of the City are described below.
Financial Reporting Entity
As required by accounting principles generally accepted in the United States of America the financial
statements of the City include the primary government and organizations for which the primary
government is financially accountable and other organizations for which the nature and significance of
their relationship with the primary government are such that exclusion would cause the reporting
entity's financial statements to be misleading or incomplete.
The City is financially accountable for legally separate organizations f its officials appoint a voting
majority of an organization's governing body and either it is able to impose Its will on that organization
or there is a potential for the organization to provide specific financial benefits to, or to impose speck
financial burdens on, the primary government. A primary government may also be financially
accountable for governmental organizations that are fiscally dependent on it.
A primary government has the ability to impose its will on an organization if it can significantly influence
the programs, projects, or activities of, or the level of services performed or provided by, the
organization. A financial benefit or burden relationship exists if the primary government (a) is entitled to
the organization's resources; (b) is legally obligated or has otherwise assumed the obligation to finance
the deficits of, or provide financial support to, the organization; or (c) is obligated in some manner for
the debt of the organization.
Some organizations are included as component units because of their fiscal dependency on the
primary government. An organization is fiscally dependent on the primary government if it is unable to
adopt its budget, levy taxes, set rates or charges, or issue bonded debt without approval by the primary
government.
317
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES- continued
Financial Reporting Entity - continued
The following entities were found to be component units of the City and are included in the basic
financial statements:
Allen Economic Development Corporation (AEDC) - The AEDC is responsible for aiding, promoting
and furthering economic development within the City.
Allen Community Development Corporation (ACDC) - The ACDC is responsible for supporting the
improvements in community parks and recreation, streets and sidewalks, public safety and the
community library.
The members of both the AEDC's and ACDC's Boards of Directors are appointed by the City
Council. Both the AEDC and ACDC are fiscally dependent upon the City as the City Council
approves their budgets and must approve any debt issuance. However, the component units do
not qualify for blending because the component services directly benefit the community rather than
the City itself. The AEDC and ACDC are discreetly presented as governmental fund types and do
not issue separate financial statements.
Basis of Presentation
The government -wide financial statements (the statement of net assets and the statement of activities)
report information on all of the activities of the City, except for fiduciary funds. The effect of interfund
activity, within the governmental and business -type activities columns, has been removed from these
statements. Governmental activities, which normally are supported by taxes and intergovernmental
revenues, are reported separately from business -type activities, which rely to a significant extent on
fees and charges for support.
The statement of activities demonstrates the degree to which the direct expenses of a given program
are affset by program revenues. Direct expenses are those that are clearly identifiable with a specific
Program. Program revenues include 1) charges to customers or applicants who purchase, use, or
directly benefit from goods, services, or privileges provided by a given program and 2) operating or
capital grants and contributions that are restricted to meeting the operational or capital requirements of
a particular program. Taxes and other items not properly included among program revenues are
reported instead as general revenues.
Fund Financial Statements:
The City segregates transactions related to certain functions or activities in separate funds in order
to aid financial management and to demonstrate legal compliance. Separate statements are
presented for governmental funds and proprietary funds. These statements present each major
fund as a separate column on the fund financial statements; all non -major funds are aggregated
and presented in a single column.
Governmental funds are those funds through which most governmental functions typically are
financed. The measurement focus of governmental funds is on the sources, uses and balances of
current financial resources. The City has presented the following major governmental funds:
36
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -continued
Basis of Presentation — continued
General Fund -
The General Fund is the general operating fund of the City. It is used to account for all financial
resources not accounted for in other funds. All general tax revenues and other receipts that are not
restricted by law or contractual agreement to some other fund are accounted for in this fund.
General operating expenditures, foxed charges and capital improvement costs that are not paid
through other funds are paid from the General Fund.
Debt Service Fund -
The Debt Service Fund is used to account for the accumulation of financial resources for the
payment of principal, interest and related costs on general long-term debt paid primarily from taxes
levied by the City. The fund balance of the Debt Service Fund is reserved to signify the amounts
that are restricted exclusively for debt service expenditures.
Facilities Agreement Special Revenue Fund -
The Facilities Agreement Special Revenue Fund is used to account for funds received from
builders and developers used on specific facility agreements such as neighborhood parks, paving
and assessments in new developments.
General Capital Projects Fund -
The General Capital Projects Fund is used to account for resources used for the acquisition andlor
construction of capital facilities by the City, except those financed by proprietary funds and not
accounted for by another capital projects fund.
Street Improvements Capital Projects Fund -
The Street Improvements Capital Projects Fund is used to account for the financing and
construction of improvements to and the extension of the Citys streets. The construction is
financed primarily by the proceeds of general obligation bonds and interest on investments.
Park Improvements Capital Projects Fund -
The Park Improvements Capital Projects Fund is used to account for the financing, improvements,
and enlargements of the City's parks. These improvements and enlargements are funded by
general obligation bond proceeds and interest on investments.
Library Capital Projects Fund -
The Library Capital Projects Fund is used to account for the financing, construction and furnishing
of library facilities with the proceeds of general obligation bonds and interest on investments.
37
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued
Basis of Presentation - continued
Proprietary Funds are accounted for using the economic resources measurement focus and the
accrual basis of accounting. The accounting objectives are determinations of net income, financial
position and cash Flow. All assets and liabilities are included on the Statement of Net Assets. The City
has presented the following major proprietary funds:
Water and Sewer Fund -
Water and Sewer Fund is used to account for the acquisition, operation and maintenance of a
municipal water and sewer utility, supported primarily by user charges to the public.
Solid Waste Fund -
The Solid Waste Fund is used to account for the provision of solid waste services to residents of
the City.
Drainage Fund -
The Drainage Fund is used to account for the provision of developing and maintaining proper
drainage services to the residents of the City.
Additionally, the City reports the Internal Service Funds which are used to account for vehicle
replacement and self funded medical and dental insurance provided to departments of the City.
Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating
revenues and expenses generally result from providing services and producing and delivering goods in
connection with a proprietary fund's principal ongoing operations. Operating expenses for the
proprietary funds include the cost of personnel and contractual services, supplies and depreciation on
capital assets. All revenues and expenses not meeting this definition are reported as non-operating
revenues and expenses.
Measurement Focus and Basis of Accounting
Measurement focus refers to what is being measured; basis of accounting refers to when revenues and
expenditures are recognized in the accounts and reported in the financial statements. Basis of
accounting relates to the timing of the measurement made, regardless of the measurement focus
applied.
The government -wide statements and fund financial statements for proprietary funds are reported
using the economic resources measurement focus and the accrual basis of accounting. The economic
resources measurement focus means all assets and liabilities (whether current or non-current) are
included on the statement of net assets and the operating statements present increases (revenues)
and decreases (expenses) in net total assets. Under the accrual basis of accounting, revenues are
recognized when earned, including unbilled water and sewer services which are accrued. Expenses
are recognized at the time the liability is incurred.
38
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued
Measurement Focus and Basis of Accounting — continued
Governmental fund financial statements are reported using the current financial resources
measurement focus and are accounted for using the modified accrual basis of accounting. Under the
modified accrual basis of accounting, revenues are recognized when susceptible to accrual; i.e., when
they become both meesumble 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 all revenues as available if they are
collected within 60 days after year end. Expenditures are recorded when the related fund liability is
incurred, except for unmatured interest on general long-term debt which is recognized when due, and
certain compensated absences and claims and judgments which are recognized when the obligations
are expected to be liquidated with expendable available financial resources.
Property taxes, sales taxes, franchise taxes and interest are susceptible to accrual. Other receipts
(special assessments) become measurable and available when cash is received by the City and are
recognized as revenue at that time.
Cash, Cash Equivalents and Investments
State statutes and policy as established by the City Council authorize the City to invest in certificates
of deposit, direct obligations of the U.S. Treasury, investment pools consisting of such U.S. Treasury
obligations, repurchase agreements, commercial paper and mutual funds. Substantially all operating
cash and rash equivalents are maintained in pooled cash and time deposit accounts. Interest income
relating to pooled deposits is allocated to the individual funds based on each fund's pro rata share of
total pooled deposits.
For purposes of the statement of cash flows, the proprietary funds consider all highly liquid
investments (including restricted assets) with an original maturity of three months or less when
purchased to be cash equivalents, as they are available for withdrawal on demand.
Investments are accounted for in accordance with GASB No. 31 — Accounting for Financial reporting
for Certain Investments and for External Investment Pools. Investments are recorded at amortized
cost when original maturity at the time of purchase is less than one year or at market if greater than
one year.
Encumbrances
Encumbrance accounting, under which purchase orders, contracts, and other commitments for the
expenditure of funds are recorded in order to reserve that portion of the applicable appropriation, is
utilized in the governmental funds. Under the City's budgetary process, appropriations lapse at fiscal
year end. Encumbrances are reported as reservations of fund balances because they do not
constitute expenditures or liabilities.
#k]
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -continued
Property Taxes
The City's property tax is levied each October 1 on the assessed value listed as of the prior January 1
for all real and certain personal property located within the City. Appraised values are established by
the Central Appraisal District of Collin County at 100% of estimated market value and certified by the
Appraisal Review Board. The assessed value upon which the 2002 levy was based is
$4,076,548,994. Taxes are due on October 1 and are delinquent after the following January 31.
The City is permitted by Article XI, Section 5 of the State of Texas Constitution to levy taxes up to
$2.50 per $100 of assessed valuation for general governmental services, including the payment of
principal and interest on general obligation long-term debt. The combined tax rale to finance general
governmental services including the payment of principal and interest on long-term debt for the year
ended September 30, 2003 was $0.562 per $100 of assessed valuation.
In Texas, countywide central appraisal districts are required to assess all property within the appraisal
district on the basis of 100% of its appraised value and are prohibited from applying any assessment
ratios. The value of property within the appraisal district must be reviewed every five years; however,
the City may, at its own expense, require annual reviews of appraised values.
The City may challenge appraised values established by the appraisal district through various appeals
and, it necessary, legal action. Under this legislation, the City continues to set tax rates on City
property. However, if the effective tax rate, excluding tax rates for bonds and other contractual
obligations, adjusted for new improvements, exceeds the rate for the previous year by more than 8%,
qualified voters of the City may petition for an election to determine whether to limit the tax rete to no
more than 8% above the tax rate of the previous year.
Interfund Receivables and Payables
Any residual balances outstanding between the governmental activities and business -type activities are
reported in the government -wide financial statements as "internal balances".
Transactions Between Funds and Between Funds and Component Units
Quasi-extemal 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 a reduction of expenditures/expenses in the fund reimbursed. All other interfund transactions,
except quasi -external transactions and reimbursements, are recorded as transfers.
Transactions between the component units and the primary government are accounted for as quasi -
external transactions. During the year ended September 30, 2003, the AEDC contributed $30,000 to
the general fund and the ACDC contributed $99,474 and $30,000 to the general fund and general
capital projects fund, respectively. The revenues were reflected as grants and contributions for the
primary government in the statement of activities.
Inventories
Inventories, which are expended when consumed, are recorded using the average cost method, and
are valued at cost.
40
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003 _
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued
Special Assessments
The City has the authority to make special assessments to property owners as part of the financing of
capital improvements. Such assessments are recorded in the capital projects fund as receivables when
assessed and are recognized as revenue when both the measurable and available criteria have been
met (generally when collected).
Capital Assets
Capital assets, which include property, plant, equipment, and infrastructure assets, are reported in the
applicable governmental or business -type activities columns in the government -wide financial
statements and in the fund financial statements for proprietary funds. All capital assets are valued at
historical cost or estimated historical cost if actual historical cost is not available. Donated assets are
valued at fair market value on the date donated. The costs of normal repairs and maintenance that do
not add to the value of the asset or materially extend the asset lives are not capitalized. Renewals and
betterments are capitalized. Interest has not been capitalized during the construction period on
property, plant and equipment.
Assets capitalized, not including infrastructure assets, have an original cost of $5,000 or more and over
one year of useful life. Depreciation has been calculated on each class of depreciable property using
the straight-line method. Estimated useful lives are as follows:
Buildings
15 - 40 Years
Towers, tanks, and pump stations
30 Years
Infrastructure
10.50 Years
Machinery and equipment
3 - 15 Years
Vehicles
2 -15 years
Library books
5 Years
Furniture and fixture
5 Years
Improvements
25 Years
The City has established the Vehicle Replacement Internal service fund to account for some of the City -
owned vehicles. Charges for use of the vehicle in the form of lease payments are made by the City
departments to the Vehicle replacement Internal Service fund to provide for future acquisitions and
replacement of City -owned vehicles
Vacation and Sick Leave (Compensated Absences)
City employees earn vacation and sick leave, which may either be taken or accumulated, up to certain
amounts, until paid upon retirement or termination. Upon termination or retirement, an employee is
reimbursed up to a maximum number of hours of vacation pay and sick leave based upon the years of
service. All vacation and sick pay is accrued in the government -wide, proprietary, and fiduciary fund
financial statements and reported as accrued salaries and wages (a current liability) only if they have
matured.
The estimated vacation and sick liability expected to be satisfied with available financial resources is
included in accrued compensated absences in the General Fund.
41
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30.2003
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – continued
Net Assets
Net assets represent the difference between assets and liabilities. Net assets invested in capital
assets, net of related debt consists of capital assets, net of accumulated depreciation, reduced by
the outstanding balances of any borrowing used for the acquisition, construction or improvements
of those assets, and adding back unspent proceeds. Net assets are reported as restricted when
there are limitations imposed on their use either through the enabling legislations adopted by the
City or through external restrictions imposed by creditors, grantors or laws or regulations of other
governments.
Implementation of New Accounting Principles
For fiscal year 2003, the City has implemented GASB Statement No. 34 (GASB 34), "Basic
Financial Statements — Management's Discussion and Analysis — for State and Local
Governments", GASB Statement No. 37 (GASB 37), "Basic Financial Statements — and
Management's Discussion and Analysis — for State and Local Governments: Omnibus" and
GASB Statement No. 38 (GASB 38), "Certain Financial Statement Disclosures..
GASB 34 creates new basic financial statements for reporting on the City's financial activities.
The financial statements now include government -wide financial statements prepared on an
accrual basis of accounting and fund financial statements which present information for individual
major funds rather than by fund type. Non -major funds are presented in total in one column.
GASB 34 also requires the City to capitalize infrastructure. Infrastructure networks recorded
include streets, sidewalks, drainage and street right of ways. The City estimated the historical
cost of general infrastructure assets utilizing current costs of similar assets and deflating those
costs through the use of appropriate price indexes. Street right of way historical cost was
estimated based on land values in the City at the time the right of way was acquired.
Comparative Data I Reclassification
Comparative data for the prior year has been presented for the individual funds in the fund
financial statements to provide an understanding of the changes in the financial position and
operations of the funds. Also, certain amounts presented in the prior year data have been
reclassified in order to be consistent with the current year's presentation.
NOTE 2. DEPOSITS, INVESTMENTS AND INVESTMENT POLICIES
Deposits – State statutes require that all deposits be fully collateralized by U.S. Government
obligations or obligations of Texas and its agencies that have a market value of not less than the
principal amount of the deposits.
The City's demand deposits and certificates of deposit were fully insured or collateralized at
September 30, 2003, with collateral required by state statutes. At year-end, the carrying amount of
the City's deposits was $1,641,665 and the bank balance was $1,032,645. Of the bank balance,
federal depository insurance covered $200,000 and the remainder was covered by collateral held by
the pledging financial institution's agent in the City's name. The City's petty cash balance at
September 30, 2003 was $7,803.
42
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30.2003
NOTE 2. DEPOSITS, INVESTMENTS AND INVESTMENT POLICIES - continued
Deposits — continued
The carrying amount of deposits for ACDC and AEDC, discretely presented component units, were
$798,090 and $50, respectively, with no corresponding bank balances as they are pooled with the City's
deposits.
Investments — State statutes authorize the City to invest in U.S. Government obligations, obligations of
Texas and its agencies and fully collateralized repurchase agreements.
Investments are categorized into three categories as defined by GASB Statement No. 3 to give an
indication of the level of risk assumed by the entity at year-end: Category 1 includes investments that are
insured or registered or for which the securities are held by the City or its agents in the City's name.
Category 2 includes uninsured and unregistered investments for which the securities are held by the
counterparty's trust department or agent in the City's name. Category 3 includes uninsured and
unregistered investments for which the securities are held by the counterparty, or by its trust department or
agent but not in the City's name. At September 30, 2003, the City had no Category 2 or 3 investments.
The City, AEDC and ACDC invest in Texpool which is an investment fund authorized by the Texas
Legislature and administered by the Texas State Treasury. The Texas Treasury Safekeeping Trust
Company is trustee of Texpool and is a limited purpose trust company authorized pursuant to Texas
Government Code. The purpose of Texpool is to allow for the pooling of public funds to provide a higher
yield on the pooled investment than would be possible with the investment of the individual public entity's
funds. Texpool investments are subject to the same investment policies maintained by the State Treasury
for all state funds. The Legislature has authorized only certain investment instruments for public funds,
including repurchase agreements, U.S. Treasury bills and bonds, securities of other U.S. government
agencies, commercial paper and other safe instruments. The investment in Texpool and any accrued
interest may be redeemed at the City s discretion. The City's position in the pool is not materially different
from the value of the pool shares.
Amounts invested in Texpool, by the City, AEDC and ACDC, respectively, are not categorized in
accordance with GASB No. 3 because they are not evidenced by securities that exist in physical or book
entry form. At September 30, 2003, the City's investment balances were as follows:
43
Category
Carrying
Fair
1
Amount
Value
Other Government Agency Securities $
33,085,822 $
33,085,822
$ 33,085,822
Texpool
$
33.085.822
38.905.004
38.905.004
$
At year-end, AEDC's investment balances were as follows:
71.990.826
$ 71.990.826
Category
Carrying
Fair
1
Amount
Value
Texpool
$
2.205.893
$ 2205.893
2205.893
$ 2205.893
43
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 2. DEPOSITS, INVESTMENTS AND INVESTMENT POLICIES - continued
Investments - continued
At year-end, ACDC's investment balances were as follows:
Category Canying Fair
1 Amount Value
Other Government Agency Securities $ 2,000,000 $ 2,000,000 $ 2,000,000
Texpool 1.003.528 1.003.528
$2000,000 S-ana= S 3003.52
NOTE 3. RECEIVABLES
Receivables at September 30, 2003 for the government's individual
major funds and non -major, and
internal service funds in the aggregate,
including the applicable allowances for uncollectible accounts,
consist of the following:
Property Sales
Accrued
To. Taxes
Acmunts
Interest Assessments Other Total
$292,980
$
$ $
$426,787 $,963,389
General Fund $1,213,740
29,882
Debt Service 176,445
1,867
2,374 180,686
Facilities
9,325
9,325
Agreement
General Capital
47,5W
67 507
Projects
Street
30,144
30,144
Improvements
Park
Improvements
14,105
71,105
Library Fund
8.077
8,077
Non-maor
Go-maor cal Funds j
24,552
2,048
208,796 235,396
Water 8 Sewer
2,469,442
16,364
2,485,806
Solid Waste
335,151
149,917 485.068
Drainage
39,483
39.483
Internal Service
Funds
19.707
8,588$
5 —�
Gross Receivables 469,425 1,213,740
2,888.335
167,907
208.796 579,078 5,527,281
Less: Allowance for
Uncollectibles (2311531
( 14.581)
! 245 731)
Total Net Receivables,
Pnmary Government 5238. < 7 ota Tan
5 2 A737sa
279fi Z 9Z,_ - 2fl1 59Z
Component Units $1.213.740
2.078
12.058
1 227,876
Total Net Remivables,
Reporting Entity23fl 7 42Z
852 _ ZS 932
1Zfl
5_211ILM QHS 6 9.23
The Water and Sewer Fund accounts receivable include unbilled charges for services rendered through
September 30, 2003.
44
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 4. CAPITAL ASSETS
Capital asset activity for the
year ended September 30, 2003, was as follows:
Balance
Sales or
Balance
September 30,
Capital
Other
Adjustments/
September 30,
2002
Acouisitions
Dispositions
Transfers
2003
Governmental Activities:
Capital assets not being
depreciated
Land 8 Land Improvements
$ 54,970,112
$ 1,403,130
$
$ 842,156
$ 57,215,397
Construction in progress
20.850.011
16.903.927
(263993341
11.354.604
Total capital assets
not being depreciated
75.820.123
18.307.057
(25.557.178)
68.570.001
Capital assets being
depreciated
Buildings
18,480,883
( 58,361)
18,451,067
36,873.389
Improvements
other than buildings
249,497,151
1,735,173
5,347,347
266,579,671
Furniture B Fizlures
1,469,090
96,667
( 4,500)
1,561,257
Vehicles
1,574,663
205,494
( 98,518)
1,738,967
3,422.606
Library Books
2,483,857
142,831
( 64,357)
2,562,331
Machinery and equipment
1.479.995
508.857
( 7.650)
19.797
2.000.999
Total capital assets being
depreciated
274.985.439
2.689.022
f 231.3861
25.557.178
303.000.253
Less: Accumulated
depreciation for:
Buildings
( 2,909,554)
( 396,399)
58,361
( 3.247,592)
Improvements
other than buildings
( 52,737,077)
( 4,058,542)
( 56,795,619)
Furniture B FlAures
( 848,566)
( 130,723)
4,500
( 974,789)
Vehicles
( 939,908)
( 429,844)
96,518
( 1,273,234)
Library Books
( 2,159,689)
( 109,541)
64,357
( 2,204,873)
Machinery and equipment
( 608.955)
f 328.854)
7,650
! 930.159)
Total accumulated!
Depreciation
( 60.203.749)
f 5.453.9031
231,386
f 65.426.288)
Total capital assets
being depreciated, net
214.781 590
f 2.764,881)
25.557.178
237.573.987
Governmental activibes
capital assets. net
$ 2M.fif11 A13
$ 15 54217fi
S
$
S 9lIR 14n ABB
45
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 4. CAPITAL ASSETS -continued
Internal Semlge Funds:
46
Balance
September 30,
Capital
Sales or
Other
Adjustments)
Balance
September 30,
2002
Acou'sitions
D'soositlons
Transfers
2003
Capital assets being depreciatetl1
$ 1,346,970
$ 626.624
$ ( 20.249)
$
$ 953345
Vehicles
Machinery and equipment
186,665
13.538
200201
Total internal service
assets being depreciated
1,533,635
640,160
( 20,249)
2,153.546
Less: Accumulated
depreciation for:
( 962,874)
( 160,133)
5,082
( 1,117,945)
Vehicles
Machinery and equipment
( 98,686)
1 33.367)
132 0531
1
Total accumulated
Depreciation
1 10615601
( 193,5001
5,062
( 1249.998)
Internal service funds
187)
$ mead
capital assets, net
- 472 075
E dd6N
E f 1c
$
Water and Sewer Activities:
Capital assets not being depreciated
$
$
E 822 843
Land
Construction in progress
$ 822,643
8.554,901
$
878.445
1 8,889,662
543.664
Total capital assets not
Wing tlepreciatetl
9 377.544
878.445
( 8889,662)
1.366.327
Capital Assets Being
Depreciated:
Towers. Tanks, & Pumps Stations 86.378,810
1,094,247
( 12,549)
8.889,662
96,350 ,170
Furniture
& Fixtures
Machinery & Equipment
8.187
1,982,796
60,987
386,620
( 1,026.474)782.109
1.342.942
Vehicles
389.352
392.757
Total capital assets
being depreciated
80759.145
1934.811
( 1039.023)
8889.662
98544.395
Less: Accumulated
depreciation for:
Towers, Tanks, & Pumps Stations ( 20,692,016)
( 2,215,678)
( 22.907,696)
( 9,101)
Furniture & Fixtures
Machinery & Equipment
( 1,365)
( 1,012.477)
( 7,736)
( 359,413)
20,750
966,552
( 384,588)
Vehicles
( 161.192)
( 79.515)
37.530
( 318.915)
1 522.092)
Total accumulated
depreciation
( 21887.050)
( 2882.342)
58.280
647.637
( 23823.475)
Total capital assets
Wing depreciated, net
66892,095
1 727.7311
1 980743)
9.537.299
74720.920
Water and Sewer activities
R3]
E ]6.f
capital assets, net
E 762696
$ t51L]14
E ( og0 ]d3 )
E 64]
UAZ
46
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30. 2003
NOTE 4. CAPITAL ASSETS • continued
Solid Waste Activities:
47
Balance
Sales or
Balance
September 30,
Capital Other
Adjustments/
September 30,
2002
Acouisi0ons Disoositions
Transfers
2003
Capital assets being depreciated
Machinery and equipment
$
$ 1,450 $
$
$ 1,450
Vehicles
44.448
44.448
Total capital assets
being depreciated
45.848
45.898
Less: Accumulated
depreciation for.
Machinery and equipment
( 307)
( 307)
Vehicles
f 6.956)
1 6.9561
Total accumulated
depreciation
( 7,263)
( 7.263)
Solid waste activities
capital assets, net
S
S 38.635 8
S
E 36 635
Drainage Activities:
Capital assets not being depreciated
Construction in progress
$ 496.132
$ S
S( 496.1321
$
Total capital assets not
being depreciated
496.132
( 496132)
Capital assets being depreciated
Towers, Tanks, 8 Pump Stations
69.906
496,132
566,038
Vehicles
54,353
54,353
Machinery and equipment
264.162
194,431
1 39.5861
419.007
Total capital assets
being depreciated
S 386A21
$ 194.431 $
456596
$1.039.398
Less: Accumulated
depreciation for:
Towers, Tanks, & Pump Stations
( 8.383)
( 19.974)
( 28,357)
Vehicles
( 20,567)
( 11,683)
( 32,250)
Machinery and equipment
( 136,622)
( 61.2
39.586
1 158.310)
Total accumulated
depreciation
( 165.572)
( 92.931)
39.586
( 218.917)
Total capital assets
being depreciated net
222.849
101.500
496,132
820.481
Drainage activities
capital assets, net
8 ]18961
S tnt5m S
S 620681
47
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 4. CAPITAL ASSETS - continued
Component Units
Business -type activities:
Water and sewer $ 2,662,342
Solid waste 7,263
Drainage utility 92.931
Total depreciation expense -Business -type activities L_2.782=
Component units:
Allen Economic Development Corporation $ 324.553
Total depreciation expense -Component units L= -U4.=
48
BalanceSales
or
Balance
September 30,
Capital Other
Adjustments/ September 30,
2002
Acquisitions Dlsoos8ions
Transfers 2003
Capital assets not being
depreciated
land
$4,138,888
$ 430,736 $
$ $4,569,624
Constmction in Progress
168,578
168.578
Total capital assets
not being depreciated
4,138,888
599.314
4,738.20
Capital assets being
deprecated
Buildings
2,942,599
2,942,599
Fixture 8 Furniture
74.028
74,028
Total capital assets being
depreciated
3.016.627
3.018.627
Less: Accumulated
depreciation for
Buildings
( 147,130)
( 309.747)
( 456,877)
55285)
Fixture 8 Furniture
f 40A79)
14 OB)
(
Total accumulated
Depreciation
( 187609)
( 3245531
( 512162)
Total capital assets
being depreciated, net
2.829.018
()
2.504.465
Total component units
capital assets, net
fi I fi
$--2798-1
Depreciation expense was charged as direct
expense to programs of the
primary government as follows:
Governmental activities:
General government
$ 258,070
Public safety
710,339
Public works
4,245,351
Culture and recreation
197,429
Community development
29.521
Grant administration
13.193
Total depreciation expense -General Capital Assets
5,453,903
Internal Service Funds
193.500
Total depreciation expense -Governmental activities
4 5 847 403
Business -type activities:
Water and sewer $ 2,662,342
Solid waste 7,263
Drainage utility 92.931
Total depreciation expense -Business -type activities L_2.782=
Component units:
Allen Economic Development Corporation $ 324.553
Total depreciation expense -Component units L= -U4.=
48
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 4. CAPITAL ASSETS -continued
Outstanding commitments at September 30, 2003, under authorized construction contracts were
$14,155,994. These outstanding commitments for capital projects will be funded from unexpended bond
proceeds and additional general obligation bonds. Authorization to issue additional bonds may be
requested from the qualified voters of the City.
NOTE 5. LONG-TERM DEBT
At September 30, 2003, bonds payable consisted of the following individual issues:
General Obligation Bonds:
Governmental
$100,000 Series 1966 Bonds due in annual installments
of $5,000 to $15,000 beginning November 1, 1995 through
November 1, 2004; interest at 5.75%.
$ 25,000
$1,978,921 Series 1992 Capital Appreciation Bonds with
principal and interest due upon maturity on September 1,
2005 and September 1, 2006; interest at 6.25% to 6.35%.
1,978,921
$7,015,000 Series 1994 Bonds due in annual installments of
$165,000 to $565,000 through September 1, 2015; interest at
5.5% to 8%.
300,0X)
$7,100,000 Series 1996 Bonds due in annual installments of
$130,00010 $585,000 through September 1, 2016; interest at
6% to 7%.
5,515,000
$10,000,000 Series 1998 Bonds due in annual installments of
$95,000 to $795,000 through September 1, 2008; interest at
4.5% to 6.5%.
8,535,000
$13,340,000 Series 1999 Bonds due in annual installments of
$320,000 to $1,055,000 through September 1, 2019; interest
at 4.875% to 6.375%.
11,745,000
$11,100,000 Series 2000 Bonds due in annual installments of
$115,000 to $915,000 through September 1, 2020; interest at
5.0% to 6.5%.
10,295,000
$20,715,000 Series 2001 Bonds due in annual installments of
$160,000 to $2,110,000 through September 1, 2021; interest
at 4.0% to 5.25%.
18,890,000
$13,000,000 Series 2002 Bonds due in annual installments of
$175,000 to 1,020,000 through September 1, 2022; interest
at 4.2% to 5.5%.
12,825,000
49
Business-tvoe
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30.2003
NOTES. LONG-TERM DEBT—continued
General Obligation Bonds - continued:
Governmental Business-tvoe
$2,705,000 Series 2003 Bonds due in annual installments of
$25,000 to $955,000 through September 1, 2007; interest at
2.0% to 3.0%. 1,925,000
$7,210,000 Series 2003 Bonds due in annual installments of
$175,000 to $515,000 through September 1, 2023; interest at
2.75% to 4.25%. 7.210.000
$ 79.243.921 $
Contractual Obligation:
Contractual obligation payable bearing interest of 10% to
12% on unpaid balances payable solely from sales
taxes collected at a spec development.
Revenue Bonds:
$8,545,000 Series 1992 Bonds due in annual installments
of $95,000 to $705,000 through June 1, 2012; interest
at 3.25% to 6.4%
$ $ 834000
$4,100,000 Series 1995 Bonds due in annual installments
-
of $115,000 to $335,000 through June 1, 2015; interest
at 5.125% to 7.125%.
2,985,000
$12,545,000 Series 1999 Bonds due in annual installments
of $330,000 to $950,000 through June 1, 2019; interest
at 3.55% to 5.00%
10,710,000
Unamortized Bond Discount
( 196.039)
ACDC
$ $ 14.328.961
Sales Tax Revenue Bonds:
$5,350,000 Series 1997 Bonds due in annual installments
of $125,000 to $435,000 through September 1, 2017;
$ 4,330,000 $
$5,125,000 Series 1999 Bonds due in annual installments of
$55,000 to $400,000 through September 1, 2017; interest
at 4.5% to 6.00%.
4,545,000
$ 8 875 000 �
wk
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 5. LONG-TERM DEBT - continued
ACDC - continued
Governmental
Business -type
Contractual Obligation:
Contractual obligation payable bearing interest or 10% to
12% on unpaid balances payable solely from sales taxes
collected at specific development
$
289 317
$
AEDC
Contractual Obligation:
Contractual obligation payable bearing interest of 10% to
12% on unpaid balances payable solely from sales
taxes collected at a specific development.
289.317
$
The following is a summary of long-term debt transactions, including current portion, of the City for the year
ended September 30, 2003:
Balance
Balance
Due
Beginning
End
Within
of Year Increases
Decreases
of Year
One Year
Governmental Activities
General Obligation Bonds $ 76,343,921 $ 9,915,000
$ (7,015,000)
$ 79,243,921
$ 5,110,000
Capital lease payable 314,591 6,789
( 116,126)
205,254
114,920
Contracts payable 1,347,569
( 768,936)
578,633
578,633
Compensated absences 1,654,749
( 34,457)
1,620,292
1,295,015
Accreted interest 1.663.698 233.050
1.896.748
Governmental activity
Long-term debt $10 154 A.99
112.9111M
S A3 Sad A4A
$ 7 09�A C g
Business Type Activities
Water and Sewer Revenue
Bonds $15,625,000 $
$ (1,100,000)
$14,525,000
$ 1,150,000
Compensated absences 80,428 7,006
( 1,805)
85,829
Less: Amounts deferred for
Issuance discounts ( 2082911
12.252
( 196.0391
12.252
Business -type activity
Long-term debt S 14497.137 $
$ ry.089.353)
$ 14 414 7911
$ 1.1_
Component Units
Sales Tax Revenue Bonds $ 9,260,000 $
$ ( 385,000)
$ 8,875,000
$ 400,000
Contractual obligations 1.347.568
( 768.934)
578.634
578.634
Component units
Long -tens debt Ate R(1] Ffin $ $ !1.153 934) A 9 A53 fi3d 9713.6
,14
The City intends to retire all of Its general long-term liabilities, plus accrued interest, from ad valorem taxes and
other current revenues. The proprietary fund type long-term debt will be repaid, plus accrued interest, from
operating revenues of the Water and Sewer Fund.
51
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 5. LONG-TERM DEBT — continued
Annual Requirements to Retire Debt Obligations
The annual aggregate maturities for each bond type for the years subsequent to September 30, 2003, are as
follows:
General Obligation Bonds
Annual debt service requirements to maturity for general obligation bonds, including interest of $36,635,551
are as follows:
Revenue Bonds
Revenue bond debt service requirements to maturity, including interest of $5,223,685 are as follows
Government Activities
Fiscal Year Ending
-
September 30
Principal
Interest
Total
2004
$ 5,110,000
$ 3,834,188 $
8,944,188
2005
4,183,251
4,748,549
8,931,800
2006
4,255,670
4,657,587
8,913,257
2007
5,595,000
3,169,014
8,764,014
2008
3,620,000
2,889,221
6,509,221
2009-2013
21,020,000
11,767,247
32,787,247
2014-2018
23,845,000
6,320,035
30,165,035
2019 2023
11.615.000
1.249.710
12.864.710
Total
$ 79.243.921
$ 38.835.551 $
117.879.47
Revenue Bonds
Revenue bond debt service requirements to maturity, including interest of $5,223,685 are as follows
52
Business Type Activities
Fiscal Year Ending
-
-September 30
Principal
Interest
Total
2004
$ 1,150,000
$ 707,806
$ 1,857,806
2005
1,215,000
645,131
1,860,131
2006
1,265,000
586,234
1,851,234
2007
1,320,000
528,104
1,848,104
2008
1,305,000
466,251
1,771,251
2009-2013
4,070,000
1,618,115
5,688,115
2014-2018
3,535,000
640,456
4,175,456
2019
665.000
31.588
696.588
Total14.525.000
5>�
$ 19 748 685
52
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTES. LONG-TERM DEBT—continued
Annual Requirements to Retire Debt Obligations - continued
Component Units
Sales Tax Revenue bond debt service requirements to maturity, including interest of $3,887,269 are as
follows:
General Obligation Bonds
The City issues general obligation bonds to provide funds for the acquisition and construction of major
capital facilities and infrastructure. During the year, $7,210,000 of general obligation bonds were issued to
finance construction projects. The City is required by ordinance to create from ad valorem tax revenues a
sinking fund sufficient to pay the current interest and principal installments as they become due. The Debt
Service Fund has $1,377,670 available to service the general obligation debt at September 30, 2003.
There are a number of limitations and restrictions contained in the various general obligation bond
indentures. The City is in compliance with all significant limitations and restrictions at September 30, 2003.
A schedule of authorized but unissued direct General Obligation Bonds as of September 30, 2003, is as
follows:
Date of
Government Activities
Previously
Fiscal Year Ending
Tarim Bodv Authorira6on
Purpose
September 30
Principal
Interest
Total
2004
$ 400,000
$ 448,339
$ 848,339
2005
420,000
423,026
843,026
2006
445,000
396,451
841,451
2007
470,000
372,983
842,983
2008
495,000
348,220
843,220
2009-2013
2,915,000
1,334,967
4,249,967
2014-2018
3,330,000
545,283
3,875,283
2019
400.000
18.000
418.000
Total
LAMUN
$ 3.887.269
R 12 762 289
General Obligation Bonds
The City issues general obligation bonds to provide funds for the acquisition and construction of major
capital facilities and infrastructure. During the year, $7,210,000 of general obligation bonds were issued to
finance construction projects. The City is required by ordinance to create from ad valorem tax revenues a
sinking fund sufficient to pay the current interest and principal installments as they become due. The Debt
Service Fund has $1,377,670 available to service the general obligation debt at September 30, 2003.
There are a number of limitations and restrictions contained in the various general obligation bond
indentures. The City is in compliance with all significant limitations and restrictions at September 30, 2003.
A schedule of authorized but unissued direct General Obligation Bonds as of September 30, 2003, is as
follows:
Date of
Amount
Previously
This
Tarim Bodv Authorira6on
Purpose
Authorized
Issued
Issue
Unissued
City of Allen 08-12-99
Fire Stn 8 Equip
$ 4,900,000
$ 3,565,000
$
$1,335,000
08-12-99
Streels
20,500,000
13,736,000
4,020,000
2,736,000
08-12-99
Drainage
1,50.000
560,000
940,000
08-12-99
Parks
22,000,000
15,344,000
3,190,000
3,474,000
08.12-00(a)
Library
10,000,000
10,000,000
11-05-02
Perform Arts Center
1915001000
19,500,000
11-05-02
Senior Center
4.000.000
4,000,Opp
Total $a2 4pp Om $43 205 (1nn $ T,21n mn [it ms nM
(a) Upon approval by the voters of the 2000 Library authorization, the remaining $125,000 and $2,270,000
of authorized but unissued bonds from the 1985 and 1994 Library authorizations were cancelled.
53
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003 —
NOTES. LONG-TERM DEBT—continued
Debt Defeasance
On January 1, 2003, the City issued $2,705,000 in General Obligation Refunding Bonds with an
average interest rate of 2.3 percent to advance refund $2,645,000 of outstanding 1992 Series bonds
with an average interest rate of 3.2 percent. The net proceeds were used to purchase U.S. Securities
that were deposited in an irrevocable trust with an escrow agent in sufficient amounts to provide for
all future payments of the refunded 1992 Series debt. As a result, the refunded debt is considered
defeased and the liability for those bonds has been removed from governmental long-term debt as
appropriate.
The City completed the advance refunding to reduce its total debt service payments over the next 4
years by $3,065,450 and to obtain an economic gain (difference between the present values of the
old and new debt service payments) of $131,093.
In prior years, the City legally defeased certain outstanding revenue bonds by placing the proceeds of
new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds.
Accordingly, the trust account assets and the liability for the defeased bonds are not included in the
City's financial statements. As of September 30, 2003, the amount of defeased debt outstanding was
$ 7,365,000.
Revenue Bonds
The City is required by the applicable revenue bond indentures to pledge the net revenues of the
Water and Sewer Enterprise Fund for the retirement of its outstanding revenue bonds, including
interest thereon, and is required to maintain debt service funds and bond reserve funds for all such
bonds outstanding.
Funds aggregating $23,046 at September 30, 2003 are restricted within the Water and Sewer
Enterprise Fund for servicing of the debt. The respective bond indentures require the City to make
equal monthly payments to the restricted accounts to accumulate the annual principal and interest
requirements as they become due.
Water and Sewer Revenue Bonds and Refunding Bonds and Drainage Utility Revenue Bonds are
payable solely from and equally secured by a first lien on and pledge of the net revenue of the City$
combined waterworks and sanitary sewer system and the net revenues of the City's drainage utility
system, respectively.
The ordinances authorizing the Revenue Bonds stipulate that the City will deposit, in addition to
principal and interest requirements, certain amounts in a reserve fund. Amounts in the reserve fund
are to be used to pay principal and interest on outstanding bonds at any time sufficient funds are not
available in the bond interest and redemption fund. The bond indentures require that the City
accumulated reserves to an amount equal to the average annual principal and interest requirements
of all outstanding bonds secured by the net revenues of the system. Such reserves are funded up to
the required level in equal monthly installments over a maximum five-year period, as defined in the
indentures. Amounts in the reserve fund at September 30, 2003 of $1,408,982 are adequate to meet
the reserve requirements.
54
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE S. LONG-TERM DEBT — continued
Revenue Bonds - continued
At September 30, 2003, restricted assets, which include Revenue Bond Debt Service and Reserve Funds,
were as follows:
Revenue bond debt service $ 137,937
Revenue bond reserve fund 1,271,045
Utility deposits 1.057.582
2.46fi.564
The amount of retained earnings reserved for revenue bond retirement is detailed as follows:
Restricted assets, revenue bond debt
Service and reserve funds $ 1,408,982
Accrued interest, payable from restricted assets ( 235,936)
Current maturities of revenue bonds,
Payable from restricted assets 1 1,150.000)
Reserved for revenue bond principal and interest
The City is in compliance with the various requirements of the bond ordinances. This covenant requires
that operating revenues, as defined, cover the current debt requirement including principal and interest by a
minimum of 1.2 times. Such coverage at September 30, 2003 was 3.1 times.
Contractual Oblloatfons
The City entered into an economic development agreement whereby the developer agreed to advance the
City funds for the City's share of the construction of a road. The developer also agreed to design,
construct, operate and manage a retail shopping center. The amount advanced, less the developer's
share of the construction of road improvements will be repaid from 100% of the City's sales tax receipts
imposed by the City, AEDC and ACDC attributed to sales by retailers at the proposed development.
The amounts reflected as contractual obligations in the City's, AEDC, and ACDC general long-term debt
account groups in the amount of $578,633, $289,317, and $289,317, respectively, as of September 30,
2003. The City, AEDC and ACDC made principal and interest payments of $754,821, $377,410, and
$377,410 respectively, from sales tax collected at the center during the year.
55
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTES. LONG-TERM DEBT—continued
Capital Leases
The City acquired office equipment under various leases accounted for as capital leases. These leases
meet the criteria of a capital lease as defined by Statement of Financial Accounting Standards No. 13,
"Accounting for Leases", which defines a capital lease generally as one which transfers benefits and risks
of ownership to the lessee. As of September 30, 2003, the capitalized cost of the leased property under
capital leases was $425,948.
The terms of the leases range from 3 - 5 years and call for monthly and annual payments over the life of the
leases. The future minimum lease payments under the capitalized leases and the net present value of the
future minimum lease payments at September 30, 2003 are as follows:
Years Ending
Annual Lease
September 30,
Payments
2003
$ 125,383
2004
83,970
2005
6,730
2006
3,821
2007
814
Future minimum lease payments
220,718
Amount representing interest
1 15.464)
Present value of future minimum lease payments
NOTE 6. INTERFUND RECEIVABLES AND PAYABLES
Due totfrom other funds at September 30, 2003 consisted of the following individual fund receivables and
payables:
Fund
Receivable
Payable
General Capital Projects
General Fund
$ 450,000
$
General Fund
400,000
Street Improvements
Facilities Agreements Fund
2,000,000
Facilities Agreements Fund
Street Improvements
2,000,000
General Fund
General Capital Projects Fund
400,487
General Capital Projects Fund
$ 2.850.487
450.487
$ 2 850.487
The purpose of interfund receivables and payables is to loan cash between funds. All balances are
expected to be settled within one year.
56
CITY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 7. INTERFUND TRANSFERS
All interfund transfers between the various funds are approved supplements to the operations of
those funds. Individual fund operating transfers for fiscal year 2003 were as follows:
Transfers Transfers
Fund
In
Out
Purpose of Transfer
General Fund:
Water and Sewer
$1,980,358
$
Operational
Solid Waste Services
24,618
Operational
Drainage Utility Fund
122,709
Operational and capital projects
General Capital Projects
1,274,842
Capital projects
Park & Rec Special Revenue
1,125,000
Operational
Water and Sewer Fund:
General Fund
1,980,358
Operational
Solid Waste Fund
12,536
Operational
Solid Waste Fund
12,549
Transfer of capital asset
General Capital Projects
4,610,885
Capital Projects
Special Assessments
15,000
Solid Waste Services:
General Fund
24,618
Operational
Water and Sewer Fund
12,549
Transfer of capital asset
Water and Sewer Fund
12,536
Operational
Drainage Utility Fund:
General Fund
122,709
Operational and capital projects
General Capital Projects
130,694
Capital projects
Special Assessment:
Water and Sewer
15,000
Operational
General Capital Projects
478,150
Capital Projects
Library:
General Capital Projects
81,975
Operational
Police:
General Capital Projects
2,700
Operational
Fire:
General Capital Projects
7,720
Operational
Park:
General Capital Projects
155,220
Operational
Antenna Rental:
General Capital Projects
228,383
Capital projects
Parks and Recreation:
General Fund
1,125,000
Operational
57
CITY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2003
NOTE 7. INTERFUND TRANSFERS -continued
Transfers Transfers
Fund In Out
General Capital Projects:
General Fund
Water & Sewer
Drainage
Special Assessments
Library
Police
Fire Station
Park
Amenna Rental
NOTE 8. RETIREMENT PLAN
1,274,842
4,610,885
130,694
478,150
81,975
2,700
7,720
155,220
228.383
Purpose of Transfer
Capital projects
Capital projects
Capital projects
Capital projects
Operallonal
Operational
Operational
Operational
Capital projects
Plan Description
The City provides pension benefits for all of its full-time employees through a non-traditional, joint
contributory, hybrid defined benefit plan in the state-wide Texas Municipal Retirement System (TMRS),
one of 774 administered by TMRS, an agent multipl"mployer public employee retirement system.
Benefits depend upon the sum of the employee's contributions to the plan, with interest, and the City -
financed monetary credits, with interest. At the date the plan began, the City granted monetary credits
for service rendered before the plan began of a theoretical amount equal to two times what would have
been contributed by the employee, with interest, prior to establishment of the plan. Monetary credits for
service since the plan began are a percent (100%, 150%, or 200%) of the employee's accumulated
contributions. in addition, the City can grant, as often as annually, another type of monetary credit
referred to as an updated service credit which is a theoretical amount which, when added to the
employee's accumulated contributions and the monetary credits for service since the plan began, would
be the total monetary credits and employee contributions accumulated with interest if the current
employee contribution rate and City matching percent had always been in existence and it 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 it the sum of the employee's
accumulated contributions with interest and the employer -financed monetary credits with interest were
used to purchase an annuity.
Members can retire at ages 60 and above with 5 or more years of service or with 20 years of service
regardless of age. A member is vested after 5 years. The plan provisions are adopted by the governing
body of the City, within the options available in the state statutes governing TMRS and within the
actuarial constraints also in the statutes.
CITY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 8. RETIREMENT PLAN - continued
Plan Description - continued
The pension plan does not issue separate reports on the pension plan. However, TMRS does issue a
publicly available report that includes financial statements and supplementary information for the plan as
a whole, but not for individual employers. That report can be obtained by writing to: Texas Municipal
Retirement System, P.O. Box 149153, Austin, Texas 78714-9153.
Contributions
The contribution rate for the employees is 7%, and the City matching ratio is currently 2 to 1, both as
adopted by the governing body of the City. Under the state law governing TMRS, the actuary annually
determines the City contribution rate. This rate consists of the normal cost contribution rate and the prior
serAoe contribution rate, both of which are calculated to be a level percent of payroll from year to year.
The normal cost contribution rate finances the currently accruing monetary credits due to the City
matching percent, which are the obligation of the City as of an employee's retirement date, not at the time
the employee's contributions are made. The normal cost contribution rale is the actuarially determined
percent of payroll necessary to satisfy the obligation of the City to each employee at the time his/her
retirement becomes effective. The prior service contribution rate amortizes the unfunded (over funded)
actuarial liability (asset) over the remainder of the plan's 25 -year amortization period. The unit credit
actuarial cost method is used for determining the City contribution rate. Both the employees and the City
make contributions monthly. Since the City needs to know its contribution rate in advance for budgetary
purposes, there is a one-year delay between the actuarial valuation that is the basis for the rate and the
calendar year when the rate goes into effect. (i.e. December 31, 2002 valuation is effective for rates
beginning January 2004).
Schedule of Actuarial Liabilities and Funding Progress
Actuarial Valuation Date
2092
2001
2000
low
1999
1997
Actuarial value of assets (1)
$23,100,250
$19,247,588
$16,375,900
514,193,181
$11,599,541
$9.549,733
Actuarial accrued liability(1)
28,115,656
24.411,638
22,396,483
17,723,052
15,743,031
12,476,918
Percentage fimded
82%
79%
73%
80%
74%
77%
unfunded (Over -untied) Actuarial
Accnied Liability (UAAL)
5,015,406
5,164,070
6,020,583
3,529,871
4,143,490
2,927,185
Annual covered payroll (2)
17,651,515
14,778,443
11,938,005
10,994,145
8,986,968
7,274,772
UAAL as a percenlage of
covered payroll
28%
35%
50%
32%
46%
40%
Net Pension Obligation (NPO)
at the beginning of period
Annual pension cost (1):
Annual Required Contribution (ARC)
1,868,305
1,758,583
1,315,729
1,218,421
1,040,079
834,500
Interest on NPO
Adjustment to ARC
Conbibuhans made (2) 1,858,305 1,756,583 1,315,729 1,218,421
Increase in NPO
NPO at the end of the period
1.040.079 834,500
CITY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTES. RETIREMENT PLAN -continued
Annual City TMR pension cost and related information for the last three years is as follows:
Annual required contribution (ARC)
Actual contribution
Net pension obligation
Actuarial cost method
Amortization method
Remaining amortization period
Asset valuation method
Actuarial Assumptions:
Investment Rate of Return
Projected Salary Increases
Includes Inflation At
Cost of Living Adjustments
2003
$ 1,868,305
1.868.305
Unit Credit
Level of Percent
of Payroll
25 Years - Open Period
Amortized Cost
(to accurately reflect
the requirements of
GASB stmt, No. 25,
paragraphs 36e and 138)
NOTE 9. WATER AND SEWER CONTRACTS
8%
None
None
None
2002 2001
$ 1,755,583 $ 1,315,729
1.766.683 1.315.729
Unit Credit
Unit Credit
Level of Percent
Level of Percent
of Payroll
of Payroll
25 Years -Open Period 25 Years -Open Period
Amortized Cost
(to accurately reflect
the requirements of
GASB stmt, No. 25,
paragraphs 36e and 138)
8%
None
None
None
Amortized Cost
(to accurately reflect
the requirements of
GASB stmt, No. 25,
paragraphs 36e and 138)
8%
None
None
None
In 1972, the City entered Into a forty -year contract with the North Texas Municipal Water District (District) for
the purchase of water. Under the terms of this contract, the City is obligated to make a minimum annual
payment (adjusted annually) in return for a minimum volume of gallons of water per year. During 1998, the
City was annexed into the North Texas Municipal Water District, which guaranteed the City a minimum
volume of water. During the year ended September 30, 2003, the cost of water purchased under this
contract was $3,473,207
In 1978, the City entered into a contract with the District for the transportation, treatment and disposal of
sanitary sewage and other waste. The contract will continue in force at least until all bonds issued by the
District pursuant to the contract have been paid in full and will remain in force thereafter throughout the
useful life of the District's sanitary sewer system. The contract requires the City to pay varying amounts
based on the costs associated with sewage transported and/or treated and disposed of. The cost includes
the City's proportionate share of the District's operating and maintenance expenses and related debt
service costs. During 2003, the cost for transportation, treatment and disposal of sewage and other wastes
was $2,960,242.
CITY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 10. DEFERRED COMPENSATION PLAN
As a result of legislative changes, all amounts of compensation deferred, all property and rights
purchased, and all income, property or rights are (until paid or made available to the employee or other
beneficiary) held in trust for the exclusive benefit of the participants and their beneficiaries, whereas,
prior to these legislative changes, these amounts were solely the property and rights of the City subject
only to the claims of the Citys general creditors. As a result, at September 30, 2003, the deferred
compensation investments are not reported in the City's financial statements.
NOTE 11. SELF-INSURANCE AND RISK MANAGEMENT
The City has established a self-insurance plan for City employees and their covered dependents. The City
self -insures its employees and their dependants for medical and dental care up to certain amounts per
insured person and in the aggregate. At September 30, 2003, the annual limitation on City health claim
expense was $25,000 per person. A third -party insurance company re -insures the City for individual claims
in excess of $25,000 up to a lifetime maximum of $1,000,000. The maximum claim for all employees, in
the aggregate, is based upon a formula. All claims and maximums are calculated for a plan year ending
each December 31.
There has been no significant reduction in insurance coverage in prior fiscal years and the amount of claim
settlements has not exceeded insurance coverage for the past three fiscal years.
Accrued liabilities include provisions for claims reported and claims incurred but not reported. The
provision for reported claims is determined by estimating the amount that will ultimately be paid to each
claimant. The provision for claims incurred but not yet reported is estimated based on the City's
experience since the inception of the program.
Premium payments are reported as quasi-exlemal interfund transactions; accordingly, they are treated as
operating revenues of the Self -Insurance Internal Service Fund and operating expenditurestexpenses of
the participating funds.
Changes in the medical and dental claims liability during fiscal years ended September 30, 2000 through
2003 were as follows:
61
Balance at
Current Year
End of
Balance at
Claims and
Year Ending
Beginning of
Changes in
September 30,
Fiscal Year
Estimates
2000
$
$ 1,214,157
2001
272,791
2,414,770
2002
307,765
2,467,587
2003
303,246
3,011,365
61
Balance at
Claim
End of
Payments
Fiscal Year
$ 941,366
$ 272,791
2,379,796
307,765
2,472,106
303,246
2,952,591
362,020
CITY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30 2003
NOTE 11. SELF-INSURANCE AND RISK MANAGEMENT - continued
The City is exposed to varying degrees of risk and loss from liability claims, auto and vehicle liability,
mechanical breakdown of equipment, and loss of property due to natural disasters and vandalism. To
cover this risk, the City participates in the Texas Municipal League Joint Self -Insurance Fund (TMLIF) to
provide general liability, workers' compensation claims and property insurance. The City, along with other
participating entities, contributes annual amounts determined by TMLIF management. As claims arise they
are submitted to and paid by TMLIF. The City has a self-insured retention for property and liability of
$10,000 per occurrence. Any claims over the self-insured retention are covered by TMLIF. During 2003,
the City contributed $556,374 to the fund for property, general liability, and workers compensation.
NOTE 12. COMMITMENTS AND CONTINGENT LIABILITIES
Federal Grants
The City participates in a number of State and Federally assisted grant programs. Amounts received or
receivable from grant agencies are subject to audit and adjustment by grantor agencies, principally the
federal government. Any disallowed claims, including amounts already collected, may constitute a liability of
the applicable funds. The amount, if any, of expenditures which may be disallowed by the grantor cannot be
determined at this time although the City expects such amounts, if any, to be immaterial.
Litigation
The City is a defendant in various lawsuits. Although the outcome of these lawsuits is not presently
determinable, it is the opinion of the City's counsel that resolution of these matters will not have a material
adverse effect on the financial condition of the City.
Economic Development Grant
The City has entered into an economic development agreement whereby it has agreed to pay a grant to a
developer in return for the developer designing, constructing, operating, and managing a retail, shopping
center. The grant is calculated at $22 per gross leasable square feet up to a maximum of 458,000 square
feet. The grant is payable solely from sales tax receipts imposed by the City, AEDC, and ACDC, attributed
only to sales by retailers at the proposed development for a period not to exceed 15 years from the date of
certificate of occupancy. If the developer has not completed a minimum of 418,000 square feet within six
years after the commencement of construction, then the City is no longer obligated to make any future grant
payments. The developer had completed construction of 346,590 square feet of the retail shopping center
as of September 30, 2003.
NOTE 13. PRIOR PERIOD ADJUSTMENT
Effective October 1, 2002, two enterprise funds and one agency fund were closed and the resulting net
assets were rolled into the Parks and Recreation Special Revenues Fund. Those three funds were
originally misclassified and should have been classified as Special Revenue Funds prior to October 1,
2002. As a result of the adjustment, the beginning net assets balance of the Parks and Recreation Special
Revenue Fund was increased by $125,990 to a beginning balance of $125,990. This adjustment has no
impact on current year operations.
62
Required
Supplementary
Information
63
CITY OF ALLEN
ME
CITY OF ALLEN, TEXAS
EXHIBIT A-1
GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES -BUDGET AND ACTUAL
FOR THE YEAR ENDED SEPTEMBER 30, 2003
VARIANCE WITH
BUDGETED AMOUNTS
FINALBUDGET-
POSITIVE
ORIGINAL
FINAL
ACTUAL
(NEGATIVE)
REVENUES
Ad vNaem taxes, penalties and interest
$ 14,646,631
$ 14,603,165
S 14,682,974
$ 79,809
Franchise tome,
7290,250
3,075,583
3,349,730
274,147
Municipal sales W
3,516,700
6,722,230
6,740,270
18,040
License, penrits and teas
1,888,100
1,356,700
1,364,939
8.239
Chargefosarvices
1287,777
1,108,776
988,076
(120,700)
Fines
120,171
1,318,800
1,428274
109,474
Gifts and Contributions
137,207
137,207
Intergovernmental
802,768
1,030,712
794,840
(235,872)
Interest earn ed
183,312
180AN
200,947
20,947
Miscellanecus
325,089
485,367
478,377
(6,990)
Total revenues
31,148,798
29,881,333
30,165,634
284.301
EXPENDITURES
Current
General goromment
5,882,821
5,738,551
5,184,152
554,399
Public safety
13,795,166
13,607,756
13,651,576
58,180
Public works
2,828,819
2,644,115
2444,021
200,094
Culture and recreation
5,454,006
5,213,592
5,026,395
187,197
Conrnmity devebprrent
1,580,058
1,527,244
1,492,952
34,292
Grants administration
1,158,159
1,370,649
1,025,141
345,508
Debt service:
Principal refinement
620,960
455,880
860,771
(204,881)
Interest and fiscal charges
155,240
112,433
94,050
18,383
Total evpenditures
31,453229
30,670230
29,479,058
1,191,172
Exces,(deficiency) of revenues war expenditunes
(304,431)
1788,897)
686,576
1,475,473
OTHER FINANCING SOURCES (USES)
Proceeds from capital lsaas obligation
6,789
6,789
Transfers frornother funds
2238,668
2257,156
2,127,685
(129,473)
Trans(anetcolher(unds
(1,825,000)
(1,911,753)
(2,399,842)
(488,089)
Total other financing sources; (uses)
413,888
345,405
(265,368)
(610,773)
NET CHANGE IN FUND BALANCE
109,237
(443,492)
421,208
864,700
FUND BALANCES, BEGINNING OF YEAR
7,011,079
7,011,079
7,011,079
FUND BALANCES, END OF YEAR
$ 7,120,316
$ 6,567,587
$ 7,432,287
$ 864,700
65
CITY OF ALLEN, TEXAS
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
YEAR ENDED SEPTEMBER 30 2003
BUDGETARY INFORMATION
The City Council adheres to the following procedures in establishing the budgets reflected in the
financial statements:
1. Each year the City Manager is required to submit to the City Council a proposed budget for the
fiscal year beginning on the following October 1. The operating budget includes proposed
expenditures and the means of financing them.
2. Public hearings are conducted to obtain taxpayers' comments.
3. Prior to October 1, the budget is legally enacted by the City Council through passage of an
ordinance.
4. Annual budgets are legally adopted for the General Fund and Debt Service Fund on a basis
consistent with accounting principles generally accepted in the United States of America. Formal
budgetary integration is not employed for proprietary funds. However, the City does adopt an
annual budget for those funds for managerial control.
5. The City Manager is authorized to adjust budgeted amounts; however, such revisions may not
result in total expenditures (appropriations) in excess of budgeted expenditures without approval of
the City Council. Therefore, the legal level of budgetary control is total budgeted expenditures.
6. Formal budgetary integration is not employed for Special Revenue Funds, Proprietary Funds or
Capital Projects Funds. However, the City does adopt an annual budget for those funds for
managerial control.
7. Budgetary data for the Special Revenue Funds and Capital Projects Funds has not been presented
in the accompanying basic financial statements as such funds are budgeted over the life of the
respective grant or project and not on an annual basis. Budgetary information for the Proprietary
Funds have not been presented since reporting on such budgets is not legally required.
The Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual —
General Fund presents a comparison of budgetary data to actual results. The General Fund utilizes
the same basis of accounting for both budgetary purposes and actual results.
M
Combining
and
Individual Fund
Statements
and
Schedules
CITY OF ALLEN
68
MAJOR GOVERNMENTAL FUNDS
GENERALFUND
The General Fund is used to account for resources associated with traditional governmental functions
that are not required legally or by sound financial management to be accounted for in another fund.
DEBT SERVICE FUND
The Debt Service Fund is used to account for the accumulation of resources for and the payment of
general obligation bonds and interest from governmental resources.
SPECIAL REVENUE FUND
The Special Revenue Funds account for the proceeds of specific revenue sources (other than
expendable trust or capital projects) that are legally restricted to expenditures for specific purposes. The
City classifies the following Special Revenue Fund as a major fund:
Facilities Agreement Fund — To account for funds received from builders and developers used on
specific facility agreements such as neighborhood parks, paving and assessments in new
developments.
CAPITAL PROJECTS FUNDS
The Capital Projects Funds account for all resources used for the acquisition and/or construction of major
capital facilities by the City, except those financed by proprietary funds and trust funds. The following
Capital Projects Funds are classified as major funds:
General Capital Projects Fund — To account for resources used for the acquisition and/or
construction of capital facilities by the City, except those financed by proprietary and trust funds and
not accounted for by the other capital project funds.
Street Improvements Fund — To account for the financing and construction of improvements to and
the extension of the City's streets. The construction is financed primarily by the proceeds of general
obligation bonds and interest on investments.
Park Improvements Fund — To account for the financing, improvements, and enlargements of the
City's parks. These improvements and enlargements are funded by general obligation bond
proceeds and interest on investments.
Library Fund — To account for the financing, construction and furnishing of library facilities with the
proceeds of general obligation bonds and interest on investments.
69
CITY OF ALLEN, TEXAS
GENERALFUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2003 AND 2002
ASSETS
Cash and cash equivalents
Investments
Receivables:
Ad valorem taxes (net of allowances for unwllectibles
of $143,204 in 2003 and $107,956 in 2002)
Sales taxes
Accrued interest
Other
Due from other funds
Prepaid expenses
TOTAL ASSETS
LIABILITIES AND FUND BALANCE
LIABILITIES:
Aw nts payable
Accrued liabilities
Due to other funds
Deferred revenue
TOTAL LIABILITIES
FUND BALANCES:
Reserved for encumbrances
Reserved for prepaid items
Unreserved:
Designated for wurt security and technology
Designated for library services
Designated for police services
Designated for fire services
Undesignated
TOTAL FUND BALANCES
TOTAL LIABILITIES AND FUND BALANCE
70
EXHIBIT B-1
2003 2002
3,215,201 $ 5,873,022
5,000,000 3,700,000
149,776
308,706
1,213,740
1,158,101
29,882
17,115
426,787
327,379
400,487
3,005,939
2,353
11,840
10,438,226
11,396,163
875,117
825,169
1,530,559
1,576,209
450,487
1,200,000
149,776
783,706
3,005,939
4,385,084
110,553
680,095
2,363
185,857
120,745
4,128
4,127
6,785
6,792
2,913
3,196
7,119,698
6,196,124
7,432,287
7,011,079
$ 10,438,226 $
11,396,163
CRY OF ALLEN, TEXAS
GENERALFUND
COMPARATIVE STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002
REVENUES
Ad valorem taxes, penalties and interest
Franchise taxes
Municipal sales tax
License, permits and fees
Charge for services
Fines
Gifts and contributions
Intergovernmental
Interest earned
Miscellaneous
Total revenues
EXPENDITURES
Curets:
General govemment
Public safety
Public works
Culture and recreation
Community development
Grants administration
Debt service:
Principal retirement
Interest and fiscal charges
Total current expenditures
Excess (deficiency) of revenues over expenditures
OTHER FINANCING SOURCES AND (USES)
Proceeds from capital lease obligation
Transfers from other funds
Transfers to other funds
Total other financing sources (uses)
NET CHANGE IN FUND BALANCES
FUND BALANCE, BEGINNING OF YEAR
FUND BALANCE, END OF YEAR
EXHIBIT B-2
2003 2002
14,682,974
3,349,730
6,740,270
1,364,939
988,076
1,428,274
137,207
794,840
200,947
478,377
i 12,594,563
3,270,580
6,575,564
1,484,888
1,147,409
1,179,269
60.000
896,321
181,737
479,584
30,165,634 27,889,915
5,184,152
5,091,235
13,551,576
12,813,503
2,444,021
2,360,227
5,026,395
5,423,075
1,492,952
1,522,634
1,025,141
660,771
544,998
94,050
136,707
29,479,058
27,891,479
666,576
(21,564)
6,789
396,945
2,127,685
2,054,256
(2,399842) {2,101,562)
(265,368)
349,639
421,208
328,075
7,011,079
6,683,004
$ 7,432,287 $
7,011,079
71
CITY OF ALLEN, TEXAS
DEBT SERVICE FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2003 AND 2002
ASSETS:
Cash and cash equivalents
Investments
Receivables:
Ad valorem taxes (net of allowances for uncollectibles
of $87,949 in 2003 and $71,216 in 2002)
Accrued interest receivable
Other receivables
Total assets
LIABILITIES AND FUND BALANCES:
LIABILITIES:
Deferred revenue
Interest payable
Total liabilities
FUND BALANCE:
Reserved for debt service
TOTAL LIABILITIES AND FUND BALANCE
72
EXHIBIT B-3
2003 2002
$ 380,685 $ 1,036,613
1,000,000
88,496 177,811
1,867
2,374 4,122
$ 1,473,422 $ 1,218,546
$ 88,496 $ 177,811
7,256
95,752 177,811
1,377,670 1,040,735
$ 1,473,422 $ 1,218,546
CRY OF ALLEN, TEXAS
DEBT SERVICE FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002
EXHIBIT Bd
EXPENDITURES:
2003
2002
REVENUES:
4,370,000
3,725,000
Ad valorem tax
$ 8,598,834
7,211,959
Interest
67,398
120,439
Excess (Deficiency) of revenues over expenditures
Total revenues
8,666,232
7,332,398
EXPENDITURES:
Principal retirement
4,370,000
3,725,000
Interest and fiscal charges
4,018,210
3,715,129
Total expenditures
8,388,210
7,440,129
Excess (Deficiency) of revenues over expenditures
278,022
(107,731)
OTHER FINANCING SOURCES AND (USES):
Transfers from other funds
300,000
Proceeds from refunding bonds
2,712,759
Payment to refund bond escrow agent
(2,653,846)
Total other financing sources
58,913
300,000
NET CHANGE IN FUND BALANCES
336,935
192,269
FUND BALANCE, BEGINNING OF YEAR
1,040,735
848,466
FUND BALANCE, END OF YEAR
$ 1,377,670
$ 1,040,735
73
CITY OF ALLEN, TEXAS
DEBT SERVICE FUND
BUDGETARY COMPARISON SCHEDULE
FOR THE ENDED SEPTEMBER 30, 2003
EXHIBIT 13-5
74
VARIANCE WITH
BUDGETED AMOUNTS
FINAL BUDGET
POSITIVE
ORIGINAL
FINAL
ACTUAL
(NEGATIVE)
REVENUES
Ad valorem tax
$ 8,568,574 $
8,558,093
$ 8,598,834
$ 40,741
104,895
98,500
67,398
(31,102)
Interest
Total revenues
8,673,469
8,656,593
8,666,232
9,639
EXPENDITURES
Principal retirement
4,885,000
4,370,000
4,370,000
Interest and fiscal charges
4,170,158
4,042,225
4,018,210
24,015
Total expenditures
9,055,158
8,412,225
8388,210
24,015
Excess (deficiency) of revenues over expenditures
(381,689)
244,368
278,022
33,654
OTHER FINANCING SOURCES AND (USES)
Transfers from other funds
292.390
60,000
2,712,759
2,652,759
Proceeds from refunding bonds
(2,653,846)
(2,653,846)
Payment to refund bond escrow agent
Total other financing sources (uses)
292,390
60,000
58,913
(1,087)
NET CHANGE IN FUND BALANCES
(89,299)
304,368
336,935
32,567
FUND BALANCE, BEGINNING OF YEAR
1,040,735
1,040,735
1,040,735
FUND BALANCE, END OF YEAR
$ 951,436 $
1,345,103
$ 1,377,670
$ 32,567
74
CITY OF ALLEN, TEXAS
FACILITIES AGREEMENT FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2003 AND 2002
EXHIBIT B-6
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable $ $ 410,996
Retainage payable 606 35,849
Deferred revenue 4,065,889 3,251,496
Total liabilities 4,066,495 3,498,341
FUND BALANCES
Reserved for encumbrances
2003
2002
ASSETS
2,037,118
1,907,179
Cash and cash equivalents
$ 2,177,037 $
1,467,088
Investments
1,997,000
3,882,251
Accrued interest receivable
9,325
25,330
Due from other funds
2,000,000
147,331
Total assets
$ 6,183,362 $
5,522,000
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable $ $ 410,996
Retainage payable 606 35,849
Deferred revenue 4,065,889 3,251,496
Total liabilities 4,066,495 3,498,341
FUND BALANCES
Reserved for encumbrances
79,749
116,480
Unreserved: Undesignated
2,037,118
1,907,179
Total fund balances
2,116,867
2,023,659
Total liabilities and fund balances
$ 6,183.362 $
5,522,000
75
CITY OF ALLEN, TEXAS
FACILITIES AGREEMENT FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002
EXHIBIT B-7
2003 2002
REVENUES
$ 86,892 $
1,004,720
Gifts and contributions
Interest
93,208
123,847
Total revenues
180,100
1,128,567
EXPENDITURES
86,892
1,004,720
Capital oullay
Total expenditures
86,892
1,004,720
NET CHANGE IN FUND BALANCES
93,208
123,847
FUND BALANCES, BEGINNING OF YEAR
2,023,659
1,899,812
FUND BALANCES, END OF YEAR
$ 2,116,867 $
2,023,659
76
CITY OF ALLEN, TEXAS
GENERAL CAPITAL PROJECTS FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2003 AND 2002
ASSETS
Cash and cash equivalents
Investments
Accrued interest receivable
Due from other funds
Total assets
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable
Retainage payable
Due to other funds
Total liabilities
FUND BALANCES
Reserved for encumbrances
Unreserved:
Designated for capital projects
Total fund balances
Total liabilities and fund balances
77
EXHIBIT B-8
2003 2002
$ 6,465,496 $
4,421,300
8,000,000
4,142,286
47,507
10,228
450,000
2,041,617
$ 14,963,003 $
106615,431
$ 372,742 $ 325,005
34,267 98,345
400,000
807,009 423,350
1,458,202
14,155,994 8,733,879
14,155,994 10,192,081
$ 14,963,003 $ 10,615,431
CITY OF ALLEN, TEXAS
GENERAL CAPITAL PROJECTS FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002
EXHIBIT B-9
Deficiency of revenues over expenditures
OTHER FINANCING SOURCES
Transfers from component unit
Transfers from other funds
Proceeds from contractual obligations
Total other financing sources
NET CHANGE IN FUND BALANCES
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
78
(3,006,656) (2,158,868)
2003
2002
REVENUES
Intergovernmental
$ 2,662,487 $
696,427
Interest
207,184
156,320
Contributions
48,100
Miscellaneous
412
23'088
Total revenues
2,918,213
875,835
EXPENDITURES
194,622
156,218
General government
5,730,247
2,878,485
Capital outlay
Total expenditures
5,924,869
3,034,703
Deficiency of revenues over expenditures
OTHER FINANCING SOURCES
Transfers from component unit
Transfers from other funds
Proceeds from contractual obligations
Total other financing sources
NET CHANGE IN FUND BALANCES
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
78
(3,006,656) (2,158,868)
1,062,588
6,970,569
5,049,567
1,062,588
6,970,569
7,174,743
3,963,913
5,015,875
10,192,081
5,176,206
$ 14,155,984 $
10,192,081
CITY OF ALLEN, TEXAS
STREET IMPROVEMENTS FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2003 AND 2002
EXHIBIT B-10
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable S 1,485,018 $ 19,689
Retainage payable 223,501 42,520
Due to other funds 2,000,000
Total liabilities 3,708,519 62,209
FUND BALANCES
Reserved for encumbrances 2,176,824 3,230,404
Unreserved: Undesignated 3,855,930 6,939,351
Total fund balances 6,032,554 10,169,755
Total liabilities and fund balances $ 9,741,073 $ 10,231,964
79
2003
2002
ASSETS
Cash and cash equivalents
$ 4,710,929 $
2,748,328
Investments
5,000,000
7,445,931
Accrued interest receivable
30,144
37,705
Total assets
$ 9,741,073 $
10,231,964
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable S 1,485,018 $ 19,689
Retainage payable 223,501 42,520
Due to other funds 2,000,000
Total liabilities 3,708,519 62,209
FUND BALANCES
Reserved for encumbrances 2,176,824 3,230,404
Unreserved: Undesignated 3,855,930 6,939,351
Total fund balances 6,032,554 10,169,755
Total liabilities and fund balances $ 9,741,073 $ 10,231,964
79
CITY OF ALLEN, TEXAS
STREET IMPROVEMENTS FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30,20D3 AND 2002
REVENUES
Interest
Total revenues
EXPENDITURES
Public works
Capital outlay
Total expenditures
Deficiency of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Transfers to other funds
Proceeds from sale of bonds
Total other financing sources
NET CHANGE IN FUND BALANCES
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
Lug
EXHIBIT B-11
2003 2002
$ 184,464
$ 178,719
184,464
178,719
35,347
27,101
8,306,318
1,526,048
8,341,665
1,553,149
(8,157,201)
(1,374,430)
(89,746)
4,020,000
5,056,000
4,020,000
4,966,254
(4,137,201)
3,591,824
10,169,755
6,577,931
$ 6,032,554
$ 10,169,755
CITY OF ALLEN, TEXAS
PARKIMPROVEMENTSFUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2003 AND 2002
ASSETS
Cash and cash equivalents
Investments
Accrued interest receivable
Total assets
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable
Retainage payable
Total liabilities
FUND BALANCES
Reserved for encumbrances
Unreserved: Undesignated
Total fund balances
Total liabilities and fund balances
81
EXHIBITB-12
2003 2002
$ 4,793,523 $
2,351,196
3,000,000
5,350,386
14,105
18,639
$ 7,807,628 $
7,720,221
$ 2,197 $ 7139,925
9,435 237,713
11,632 1,007,638
62,292 1,866,824
7,733,704 4,845,759
7,795,996 6,712,583
$ 7,807,628 $ 7,720,221
CITY OF ALLEN, TEXAS
PARK IMPROVEMENTS FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002
REVENUES
Interest
Total revenues
EXPENDITURES
Culture and recreation
Capital outlay
Total expenditures
Deficiency of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Transfers to other funds
Proceeds from sale of bonds
Total other financing sources
NET CHANGE IN FUND BALANCES
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
82
EXHIBIT B-13
2003 2002
$ 119,568
$ 232,728
119,568
232,728
81,019
6,041
1,989,916
4,149,486
2,070,935
4,155,527
(1,951,367)
(3,922,799)
(155,220)
(169,530)
3,190,000
544,000
3,034,780
374,470
1,083,413
(3,548,329)
6,712,583
10,260,912
$ 7,795,996
$ 6,712,583
CITY OF ALLEN, TEXAS EXHIBIT B•14
LIBRARY FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2003 AND 2002
2003 2002
ASSETS
Cash and cash equivalents $ 5,268,068 $ 2,157,829
Investments 2,000,000 5,479,589
Accrued interest receivable 8,077 36,349
Total assets $ 7,276,145 $ 7,673,767
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable
$ 107,289 $
10
Total liabilities
107,289
10
FUND BALANCES
Reserved for encumbrances
168,058
580,992
Unreserved: Undesignated
7,000,798
7,092,765
Total fund balances
7,168,856
7,673,757
Total liabilities and fund balances
$ 7,276,145 $
7,673,767
83
CITY OF ALLEN, TEXAS
LIBRARY FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002
REVENUES
Interest
Total revenues
EXPENDITURES
Culture and recreation
Capital outlay
Total expenditures
Deficiency of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Transfers to other funds
Proceeds from sale of bonds
Total other financing sources (uses)
NET CHANGE IN FUND BALANCES
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
M
EXHIBIT B-15
2003 2002
$ 131,153 $
78,576
7,400,000
1311153
78,576
(504,901)
5,495,151
6,066
39,291
548,013
1,920,142
554,079
1,959,433
(422,926) (1,880,857)
(81,975)
(23,992)
7,400,000
(81,975)
7,376,008
(504,901)
5,495,151
7,673,757
2,178,606
$ 7,168,856 $
7,673,757
NON -MAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS
The Special Revenue Funds account for the proceeds of specific revenue sources (other than expendable
trust or capital projects) that are legally restricted to expenditures for specific purposes. Non -major Special
Revenue Funds are as follows:
Antenna Rental Fund - To account for funds received and expended for capital items for the City.
Hotel Occupancy Tax Fund - To account for funds received from hotel occupancy tax and expend as
allowed by state law.
Asset Forfeiture Fund — To account for activities associated with assets legally seized and forfeited.
Allen Arts Alliance Fund - To account for funds received and expended to promote, nurture and
support the arts in the City of Allen.
Parks and Recreation Fund - To account for the provision of recreation services to the residents of the
City, account for the operations and maintenance of the City's leisure and competitive swimming pools
and to account for funds received and expended for the City of Allen swim team activities.
Library Acquisition Fund - To account for funds received and expended for the acquisition of library
books and other resources.
Park Dedication Fund - To account for funds received and expended for the acquisition of additional
park land and for the development of neighborhood parks.
CAPITAL PROJECTS FUNDS
The Capital Projects Funds account for all resources used for the acquisition and/or construction of major
capital facilities by the City, except those financed by proprietary funds and trust funds. The following Capital
Projects Funds are classed as non -major funds:
Special Assessments Fund - To account for funds received from property owners who were assessed
for improvements the City performed which increased their property value.
Public Safety Fire Fund - To account for the financing of construction and renovation of fire stations
and the acquisition of fire fighting equipment. General fund revenues, general obligation bond proceeds
and interest on investments are the sources of financing for building renovation and equipment
purchases.
Public Safety Police Fund - To account for the financing of construction and renovation to the Police
and Court Building. The construction is financed primarily by the proceeds of general obligation bonds
and interest on investments.
Drainage Improvements Fund - To account for the financing and construction of improvements to and
the extension of the Citys drainage system. The construction is financed primarily by the proceeds of
general obligation bonds and interest on investments.
85
CRY OF ALLEN, TEXAS
NON -MAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
SEPTEMBER 30,2003
SPECIAL REVENUE
ASSETS
Cash and cash equivalents
Investments
Accounts receivable
Interest receivable
Special assessments receivable
TOTAL ASSETS
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable
Retainage payable
Accrued liabilities
TOTAL LIABILITIES
FUND BALANCES
Reserved for encumbrances
Unreserved:
Undesignated
TOTAL FUND BALANCES
TOTAL LIABILITIES AND FUND BALANCES
HOTEL ALLEN PARKS
ANTENNA OCCUPANCY ASSET ARTS AND
RENTAL TAX FORFEITURE ALLIANCE RECREATION
$ 325,479 $ 88,659 $ 8,607 $ 8,554 $ 245,974
971 22,585 996
$ 326,450 $ 89,244 $ 8,607 $ 8,554 $ 246,970
$ $ 15,277 $ $ $ 22,781
39,225
15,277 62,006
326,450
73,967
8,607
8,554
184,964
326,450
73,967
8,607
8,554
184,964
$ 326,450 $
89,244 $
8,607 $
8,554 $
246,970
86
EXHIBIT C-1
CAPITAL PROJECTS
TOTAL
NON -MAJOR
LIBRARY PARK SPECIAL PUBLIC SAFETY PUBLIC SAFETY DRAINAGE GOVERNMENTAL
ACQUISITION DEDICATION ASSESSMENTS FIRE POLICE IMPROVEMENTS FUNDS
$ 204,151 $ 1,263,579 $ 401,706 $ 692,815 $ 74,813 $ 188,773 $ 3,480,910
1.000.000 1,000,000
24,552
2.048 2,048
208,796 208.796
$ 204.151 $ 2.265,627 $ 610.502 $ 692,615 $ 74,813 $ 188,773 $ 4,716,306
$
$ $
1,926 $
27,678 $
$
15,584 $
83,246
22,875
20,752
43.627
39.225
1.926
50,553
38.336
166,098
133,094
133,094
204.151
2,265,627
608,576
508.968
74,813
152,437
4.417,114
204.151
2,265,627
608.576
642.062
74,813
152,437
4.550,208
$ 204,151
$ 2265,627 $
610.502 $-
692,615 $
74,813 $
188,773 $
4.716.306
87
CITY OF ALLEN, TEXAS
NON -MAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED SEPTEMBER 30, 2003
1,125,000
(228,383)
SPECIAL REVENUE
(228,383)
1,125,000
HOTEL
ALLEN
PARKS
(83)
ANTENNA
OCCUPANCY
ASSET
ARTS
AND
RENTAL
TAX
FORFEITURE
ALLIANCE
RECREATION
REVENUES
$
$ $
$
Special assessments $
221,262
Hotel/motel taxes
1,482,853
Recreation fees
54,310
Gifts and contributions4
817
376
111
459
Interest
263,654
7,616
46.138
Miscellaneous
268,622
222,079
7,992
111
1,583,760
Total revenues
EXPENDITURES
General government
Public safety
Public works
Culture and recreation
Capital outlay
Total expenditures
Excess (defidency) of revenues over
expenditures
OTHER FINANCING SOURCES (USES)
Transfer: fan other funds
Transfers to other funds
Total other financing sources (uses)
NET CHANGE IN FUND BALANCES
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
26.200
8,075
68.260 230,088 87 2,649.786
94,460 230,088 8.075 87 2649,786
174,162 (8,009) (83) 24 (1,066,026)
1*13
1,125,000
(228,383)
(228,383)
1,125,000
(54,221)
(8,009)
(83)
24 58,974
380,671
81,976
8,690
8,530 125,990
$ 328.450 S
73,967 $
8,607 $
8,554 $ 184,964
1*13
EXHIBIT C-2
19
CAPITAL PROJECTS
TOTAL
NON -MAJOR
LIBRARY
PARK
SPECIAL
PUBLIC SAFETY
PUBLIC SAFETY
DRAINAGE
GOVERNMENTAL
ACQUISITION
DEDICATION
ASSESSMENTS
FIRE
POLICE
IMPROVEMENTS
FUNDS
$
$
$ 317.602
$
$
$ $
317,602
221,262
116,745
1,599,598
4,610
58,920
2.656
33,142
10,284
9,522
318
4,043
66,696
55,054
372,462
7,266
149,887
327,886
9,522
55,372
4,043
2,636,540
26,200
3,752
1,250
13,077
720
720
2,996
2,951,217
243,980
31,640
84,800
226,934
587,354
2,996
243,980
31,640
88,552
1,250
227,654
3,578,568
4,270
(94,093)
296,246
(79,030)
54,122
(223,611)
(942,028)
1,125,000
(493,150)
(7,720)
(2,700)
1731,953)
(493,150)
(7,720)
(2,700)
393,047
4,270
(94,093)
(196,904)
(86,750)
51,422
(223,611)
(548,981)
199,881
2,359,720
805,480
728,812
23,391
376,048
5,099,189
E 204.151
$ 2,265.627
$ 608576
$ 642,062
$ 74,813
$ 152.437 $
4,550,208
19
CITY OF ALLEN
R
MAJOR ENTERPRISE FUNDS
The Enterprise Funds are used to account for operations that are financed and operated in a manner similar
to private business enterprises where the intent is that the costs of providing goods or services to the general
public on a continuing basis be financed or recovered primarily through user charges; or where the City's
council has decided that periodic determination of net income is appropriate for accountability purposes.
Water and Sewer Fund — To account for the provision of water and sewer services to the residents of the
city.
Solid Waste Fund — To account for the provision of solid waste services to the residents of the City of Allen.
Drainage Fund —To account for the provision of developing and maintaining proper drainage services to the
residents of the City.
91
CITY OF ALLEN, TEXAS
WATER AND SEWER ENTERPRISE FUND
COMPARATIVE STATEMENTS OF NET ASSETS
SEPTEMBER 30, 2003 AND 2002
EXHIBIT D-1
2003
2002
ASSETS
CURRENTASSETS
$ 3,449,577
$ 5,521,040
Cash and cash equivalents
4,094,822
61566,806
Investments
Receivables, net of allowance for uncollectibles:
Accounts
2,454,861
2,196,904
Accrued interest
16,364
29,861
Inventories
18,115
44,183
Restricted cash and cash equivalents
2,488.584
2,369,408
Total current assets
12,500,303
16,728,202
CAPITAL ASSETS
822,643
822,643
Land
Towers, tanks, and pump stations
98,350,170
88,378,810
Motor vehicles
782,109
389,352
Machinery and equipment
1,342,942
1,982,796
Furniture and future
69,174
8,187
Construction in progress
543,684
8,554,901
Total capital assets
99,910,722
98,136,689
Less: accumulated depreciation
(23,823,475)
(21,867,050)
Capital assets, net of accumulated depreciation
76,087,247
76,269,639
DEFERRED CHARGES- bond issuance costs, net of amortization
44,800
47.600
TOTAL ASSETS
$ 88,632,350
$ 93,045,441
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES
$ 1,222,592
$ 1,215,514
Accounts payable
Accrued liabilities
55,252
36,049
Retainage payable
233,891
Due to other funds
988,948
Payable from restricted assets:
Revenue bonds payable
1,150,000
1,100,000
Accrued interest payable
235,936
253,031
Utilitydepoalts
1,057,582
961,541
Total current liabilities
3,721,362
4,788,974
NON-CURRENT LIABILITIES
13,178,961
14,316,709
Revenue bonds payable
Accrued compensated absences
76,654
71,520
Total noncurrent liabilities
13,255,615
14,388,229
TOTAL LIABILITIES
16,976,977
19,177,203
NET ASSETS
Invested in capital assels, net of related debt
61,803,086
60,900,530
Restricted
Restricted for revenue bond principal and interest
23,046
54,836
Unrestricted
9,829,241
12,912,872
TOTAL NET ASSETS
$ 71,655,373
$ 73,868,238
92
CITY OF ALLEN, TEXAS
2,090,224
EXHIBIT D-2
WATER AND SEWER ENTERPRISE FUND
7,363,688
6,326,704
COMPARATIVE STATEMENTS OF REVENUES, EXPENSES
189,671
135,517
AND CHANGES IN FUND NET ASSETS
95,242
96,419
FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002
2,676,140
2,571,245
Other
2003
2002
OPERATING REVENUES
12,431266
10,976,171
Water sales
$ 10,682260
$ 9,703,921
Sewer charges
3,939,556
3,320,060
Connection fees
264,240
288,882
Service charges
278,038
177,077
Miscellaneous
213,702
333,903
Total operating revenues
15,375,794
13,823,843
OPERATING EXPENSES
Personal services
2,090,224
1,788,390
Contractual and other services
7,363,688
6,326,704
Maintenance
189,671
135,517
Supplies
95,242
96,419
Depreciation and amortization
2,676,140
2,571,245
Other
16,301
57,896
Total operating erpenses
12,431266
10,976,171
OPERATING INCOME
2,944,528
2,847,672
NON-OPERATING REVENUES (EXPENSES)
Interest income
188,009
393,830
Interest expense
(743,949)
(799,951)
Development fees
880,557
1,706,293
Total non-operating expense
324,617
1,300,172
INCOME BEFORE CAPITAL CONTRIBUTIONS
AND TRANSFERS
3,289,145
4,147,844
CAPITAL CONTRIBUTIONS AND TRANSFERS
Capital contributions
1,094,246
4,072,057
Transfers from other funds
27,536
24,862
Transfers to other funds
16,603,792)
44,634,025)
Total capital contributions and transfers
(5,482,010)
1537,306)
CHANGE IN NET ASSETS
(2,212,865)
3,610,538
NET ASSETS, BEGINNING OF YEAR
73,868,238
70257,700
NET ASSETS, END OF YEAR $
71,655,373 $
73,868,236
93
CITY OF ALLEN, TEXAS
EXHIBIT D-3
WATER AND SEWER ENTERPRISE FUNDS
$ 2,944.526 $
2,847,672
COMPARATIVE STATEMENTS OF CASH FLOWS
FOR THE FISCAL YEARS ENDED SEPTEMBER 30,20D3 AND 2002
net cash provided
Depreciation and amonizaion e)q:ense
2D03
2002
CASH FLOWS FROM OPERATING ACTMTIES
$ 15117837
$ 13573462
Cash received from customers
(2,065,090)
(5,084.133)
Cash pad to MPbyees for services
(8,739,351)
(1,644,590)
Cash pad for goods and sanices
7,0787,075
219.456
Net cash provided by operating activities
4,293,396
6,844,739
CASH FLOWS FROM NON -CAPITAL FINANCING ACTIVITIES
27,536
24662
Transfers from other funds
(6,603,792)
(4,634,025)
Transfers toow funds
Net cash used In r o capital financing activities
(6,576,256)
(4,609,363)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES
(1100 000)
(1.040.0W)
Principal pad on revenue bond maturities
(761,044)
(818,456)
Interest pad
(1,384,450)
(6,705,308)
Acquisition of capita assets
880.557
1,706,293
Contributions frau devebpers
Net cash used in capital and related financing activities
(2,364,9371
(8'857'471)
CASH FLOWS FROM INVESTING ACTIVITIES
(4094822)
(18,089.956)
Pumhase of investment securities
Proceeds from the sale and maturities of imwtmenl securities
6,566,606
21,725,094
Interest on Investments
231,536
475,969
Net cash provided by investing sotiAb"
2,673,490
4,112,107
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(1,974,307)
(2,509,988)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
7,890,448
10,400,436
CASH AND CASH EQUIVALENTS, END OF YEAR
$ 5,916,141
$ 7.990.448
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
$ 2,944.526 $
2,847,672
Net Operating incwna
Adjustments to reconcile not operating Incorne
to by operating amides:
net cash provided
Depreciation and amonizaion e)q:ense
2,676,140
2,571,245
Change in assets and liabilities:
(257,957)
(254,996)
(Increase) in accounts raceivable
�'
5,068
(Increase) decrease in inventories
156'567
(Increase) decrease in prepaid items
7,0787,075
219.456
Increase (decrease) in accounts payable
(969'74$)
9 3'667
Increase in accrued liabilities
increase (decrease) In compensated abse,446
5,134
(,531)
(9
Increase in utdity deposits
98,017
(233.891)
109'473
205,072
Increase (decrease) in retainage payable
Trial adjustments
1,348.68
3997,067
Net cash provided by operating activities
$ 4,293,396 $
6,844,739
NONCASH FINANCING ACTIVITIES: $ 1094,246 $ 4,072,057
Contributions of fixed assets from devaopers ,
94
CITY OF ALLEN, TEXAS
SOLID WASTE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF NET ASSETS
SEPTEMBER 30, 2003 AND 2002
EXHIBIT D-4
2003
2002
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$
744,184
$
1,114,244
Receivables, net of allowance for uncollectibles:
Accounts
335,151
137,326
Other
149,917
52,768
Total current assets
1,229,252
1,304,338
CAPITAL ASSETS
Machinery and equipment
1,450
Vehicles
44,448
Total capital assets
45,898
Less: accumulated depreciation
(7,263)
Capital assets, net of accumulated depreciation
38,635
TOTALASSETS
$
1,267,887
$
1,304,338
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES
Accounts payable
$
157,652
$
271,993
Accrued liabilities
16,221
11,943
Total current liabilities
173,873
283,936
NON -CURRENT LIABILITIES
Accrued compensated absences
5,771
3,899
Total ran-current liabilities
5,771
3,899
TOTAL LIABILITIES
179,644
287,835
NETASSETS
Invested in capital assets, net of related debt
38,635
Unrestricted
1,049,608
1,016,503
TOTAL NET ASSETS
$
1,088,243
$
1,016,503
95
CITY OF ALLEN, TEXAS
SOLID WASTE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002
OPERATING REVENUES
Garbage collections
Other
Total operating revenues
OPERATING EXPENSES
Personal services
Contractual and other services
Supplies
Depreciation
Other
Total operaling expenses
OPERATING INCOME
NON-OPERATING REVENUES
Interest income
INCOME BEFORE TRANSFERS
TRANSFERS
Transfers from other funds
Transfers to other funds
Total transfers
CHANGE IN NET ASSETS
NET ASSETS, BEGINNING OF YEAR
NET ASSETS, END OF YEAR
n.
EXHIBIT D-6
2003 2002
$ 3,073,916 $
2,889,284
65,329
26,205
3,139,245
2,915,489
163,794
104,582
2,843,969
2,500,158
5,463
5,820
7,263
32,472
48,643
3,052,961
2,659,203
86,284
256,286
10,061
16,926
96,345
273,212
12,548
(37,154) (64,812)
(24,605) (64,812)
71,740 208,400
1,016,503 808,103
$ 1,088,243 $ 1,016,503
CITY OF ALLEN, TEXAS
EXHIBIT D-8
SOLID WASTE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF CASH FLOWS
FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2003 AND 2002
2003
2002
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers
$ 2,844,271 $
2,851,912
Cash paid to employees for services
(161,922)
(103,038)
Cash paid for goods and services
(2,991,967)
(2,477,678)
Net cash provided by (used in) operating activities
(309,618)
271,196
CASH FLOWS FROM NON -CAPITAL FINANCING ACTIVITIES
Transfers from other funds
12,549
(64,812)
Transfers to other funds
(37,154)
Net cash used in non -capital financing activities
124,605)
(64,812)
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
Acquisition of capital assets
(45,898)
Net cash used in capital and related financing activities
(45,898)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from the sale and maturities of investment securities
100,000
Interest on investments
10,061
18,980
Net cash provided by investing activities
10,061
118,980
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(370,060)
325,364
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
1,114,244
788,880
CASH AND CASH EQUIVALENTS, END OF YEAR
$ 744,184 $
1,114,244
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED BY (USED IN) OPERATING ACTIVITIES
Net operating income
$ 86,284 $
256,286
Adjustments to reconcile net operating income
to net cash provided by operating activities:
Depreciation
7,263
Change in assets and liabilities:
(Increase) in accounts receivable
(197,825)
(16,462)
(Increase) in other receivables
(97,149)
(47,115)
Increase in accounts payable
(114,341)
71,602
Increase (decrease) in accrued liabilities
4,278
5,341
Increase (decrease) in accrued compensated absences
1,872
1,544
Total adjustments
(395,902)
14,810
Net cash provided by (used in) operating activities
$ 309.6181$
271,196
97
CITY OF ALLEN, TEXAS
DRAINAGE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF NET ASSETS
SEPTEMBER 30, 2003 AND 2002
EXHIBIT 0.7
2003
2002
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$ 545,359
$ 742,489
Accounts receivable
39,483
38,006
Total current assets
584,842
780,495
CAPITAL ASSETS
568,038
89,908
Towers, tanks, and pump stations
54,353
54,353
Vehicles
Machinery and equipment
419,007
264,161
Construction in progress
496,133
Total capital assets
1,039,398
884,553
Less: accumulated depreciation
(218,917)
(165,572)
Capital assets, net of accumulated depreciation
820,481
718,981
TOTAL ASSETS
$ 1,405,323
$ 1,499,476
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES
$ 16,225
$ 40,866
Accounts payable
5,025
3,408
Accrued liabilities
Total current liabilities
21,250
44,274
NON-CURRENT LIABILITIES
Accrued compensated absences
3,404
5,009
Total noncurrent liabilities
3,404
5,009
TOTAL LIABILITIES
24,654
49,283
NET ASSETS
Invested in capital assets, net of related debt
820,481
718,981
Unrestricted
560,188
731,212
TOTAL NET ASSETS
$ 1,380,669
$ 1,450,193
[I)
CRY OF ALLEN, TEXAS EXHIBIT D-8
DRAINAGE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002
2003 2002
OPERATING REVENUES
Drainage fees
Service charges
Miscellaneous
Total operating revenues
OPERATING EXPENSES
Personal services
Contractual and other services
Maintenance
Supplies
Depreciation
Other
Total operating expenses
OPERATING INCOME
Non-operating revenues - interest income
INCOME BEFORE TRANSFERS
Transfers to other funds
CHANGE IN NET ASSETS
NET ASSETS, BEGINNING OF YEAR
NET ASSETS, END OF YEAR
$ 730,986
$ 667,268
58,147
106,132
2,331
791,464
773,400
209,599
203,793
119,642
95,619
131,205
104,920
9,374
16,164
92,931
55,148
52,269
48,993
615,020
524,637
176,444
248,763
7,435
15,428
183,879
264,191
(253,403)
(123,808)
(69,524)
140,383
1,450,193
1,309,810
$ 1,380,669
$ 1,450,193
CITY OF ALLEN, TEXAS
EXHIBIT D-9
DRAINAGE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF CASH FLOWS
FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2003 AND 2002
2003
2002
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers
$ 789,987
$ 771,362
Cash paid to employees for services
(211.204)
(203.488)
Cash paid for goods and services
(335,514)
(325,192)
Net cash provided by operating activities
243,269
242,672
CASH FLOWS FROM NON -CAPITAL FINANCING ACTIVITIES
Operafing transfers to other funds
(253,403)
(123,808)
Net cash used in non -capital financing activities
(253,403)
(123,808)
CASH FLOWS FROM CAPITAL
AND RELATED FINANCING ACTIVITIES:
Acquisition of capital assets
(194,431)
(151,392)
Net cash used in capital and related financing activities
(194,431)
(151,392)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest on investments
7,435
15,428
Net cash provided by investing activities
7,435
15,428
NET DECREASE IN CASH AND CASH EQUIVALENTS
(197.130)
(17,100)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
742,489
759,589
CASH AND CASH EQUIVALENTS, END OF YEAR
$545.3.59
$ 742,489
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
Net operating income
$ 176,444
$ 248,763
Adjustments to reconcile net operating income
to net cash provided by operating activities:
Depreciation
92,931
55,148
Change in assets and liabilities:
(increase)in accounts receivable
(1,477)
(2,038)
Increase (decrease) in accounts payable
(24.641)
(33.801)
Increase (decrease) in retainage payable
(25,345)
Increase (decrease) in accrued liabilities
1.617
(eso)
Increase (decrease) in compensated absences
(1,605)
295
Total adjustments
68.825
(6,091)
Net cash provided by operating activities
$ 243,269
$ 242,672
tr
INTERNAL SERVICE FUNDS
The Internal Service Fund is used to account for financing of services provided by one department to other
departments of the City on a cost -reimbursement basis.
The Vehicle Replacement Fund - accounts for the costs associated with the acquisition of vehicles through
the rental of such vehicles to other departments.
Self -Insurance Fund — To account for the costs associated with the medical and dental self-insurance
programs established for the City employees and their covered dependents.
101
CITY OF ALLEN, TEXAS
33:11-lkt=51
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF NET ASSETS
SEPTEMBER 30,2003
(WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 2002)
VEHICLE SELF TOTALS
REPLACEMENT INSURANCE
FUND FUND 2003 2002
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$ 2,001,755 $
855,184
$ 2,856,939
$ 2,146,543
Investments
1,994,000
1,994,000
2,635,010
Accounts receivable
19,707
19,707
Accrued interest receivable
8,588
8,588
6,264
Total current assets
4,024,050
855,184
4,879,234
4,787,817
CAPITAL ASSETS
Machinery and equipment
200,201
200,201
186,665
Vehicles
1,953,345
1,953,345
1,346,970
Accumulated depreciation
(1,249,998)
(1,249,998)
(1,061,660)
Capital assets,
net of accumulated depreciation
903,548
903,548
472,075
TOTAL ASSETS
4,927,598
855,184
5,782,782
5,259,892
LIABILITIES AND NET ASSETS
LIABILITIES
Accounts payable
3,180
34,533
37,713
21,720
Incurred but not reported claims
362,020
362,020
283,782
TOTAL LIABILITIES
3,180
396,553
399,733
305,502
NET ASSETS
Invested in capital assets,
net of related debt
903,548
903,548
472,075
Unrestricted
4,020,870
458,631
4,479,501
4,482,315
TOTAL NET ASSETS
$ 4,924,418 $
458,631
$ 5,383,049
$ 4,954,390
102
CITY OF ALLEN, TEXAS
EXHIBIT E-2
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
FOR THE YEAR ENDED SEPTEMBER 30.2003
(WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2002)
VEHICLE SELF TOTALS
REPLACEMENT INSURANCE
FUND FUND 2003 2002
OPERATING REVENUES
$ 864,877 $
2,709,470 $
3,574,347 $
3,487,515
Charges for services
33,598
33,598
317,689
Other income
Total operating revenues
864,877
2,743,068
3,607,945
3,805,204
OPERATING EXPENSES
Personal services
57,339
57,339
54,614
Contractual services
3,011,365
3,011,365
2,467,587
Depreciation
193,500
193,500
255,605
Total operating expenses
193,500
3,068,704
3,262,204
2,777,806
OPERATING INCOME (LOSS)
671,377
(325,636)
345,741
1,027,398
NON-OPERATING REVENUES
Interest income
64,654
13,744
78,398
88,868
Gain on disposal of capital assets
4,520
4,520
Total nonoperating revenues
69,174
13,744
82,918
88,668
CHANGE IN NET ASSETS
740,551
(311,892)
428,659
1,116,066
NET ASSETS, BEGINNING OF YEAR
4,183,867
770,523
4,954,390
3,838,324
NET ASSETS, END OF YEAR
$ 4,924,418 $
458,631 $
5,383,049 $
4,954,390
103
CITY OF ALLEN, TEXAS
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED SEPTEMBER 30, 2003
(WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2002)
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from transactions v41h other funds
Cash pad to employees for services
Cash paid to for goods and services
Cash pad for dams
Net cash provided by (used In) operating ac8.4ties
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Acquisition of capita assats
Net cash used in capita and related financing activilbs
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of invest n rnt securities
Proceeds f. sob and maturities of Investrnenl securities
Interest on invastrrnnis
Net cash provided by (used In) Investing activities
NET INCREASE IN CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS, END OF YEAR
RECONCILIATION OF OPERATING INCOME (LOSS)TO
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
Not operating inane (loss)
Adjustments to reconcile operating Income (loss)
to nal cash provided by (used in) operating activities:
Depreciation
Change in assets and liabilities:
(Increase) decrease In accounts receivables
(Increase) decrease in other receivables
Increase (decrease) in accounts Payable
Total atljusbronts
Net cash provided by (used in) operating activities
EXHIBITE3
VEHICLE SELF TOTALS
REPLACEMENT INSURANCE
FUND FUND 2003 2002
$ 868,057 E 2,743,068 $
3,611,125 $
4,442,308
(57,339)
(57,339)
(54,614)
(2,842,076)
(2,842,076)
(2,533,035)
(78,238)
(78238)
(32,000)
868,057 (234,585)
633,472
1,822,659
(640,180) (640,160) (132,465)
(640,160) (640,160) (132,465)
(1,994,000) (11994,000) (4,253,451)
2,335,010 300,000 2,635,010 3,618,441
61,997 14,077 78,74 92,739
403,007 314077 717,084 (542,271)
630,904 79,492 710,396 1,147,923
1,370.851 775,692 2,146,543 998,620
$ 2,01,755 S 855,184 E 2,858,939 E 2,146,543
E 671,377 $ (326,636)$ 345,741 $ 1,027,398
mi
193,500 193,500 255,605
337,104
300,000
3,180 91,051 94.231 (97,448)
198,880 91,051 287,731 795.261
868,057 (234.5881 633,472 1,822,859
Capital Assets
Used in the
Operation of
Governmental
Funds
CITY OF ALLEN, TEXAS
COMPARATIVE SCHEDULES OF CAPITAL ASSETS USED IN
THE OPERATION OF GOVERNMENTAL FUNDS - BY SOURCE {a)
SEPTEMBER 30, 2003 AND 2002
GOVERNMENTAL FUNDS CAPITAL ASSETS
Land and land improvements
Buildings
Machinery and equipment
Furniture and fixtures
Vehicles
Books
Infrastructure
Total property and equipment in service
Construction in progress
Total governmental funds capital assets
INVESTMENTS IN GOVERNMENTAL FUNDS CAPITAL ASSETS
BY REVENUE SOURCE
General obligation bond proceeds and interest income
Revenue bonds
Contributions
Othergovemments
General and otherfund operations
Special revenue funds
Total governmental funds capital assets
EXHIBIT F-1
2003 2002
$ 57,215,397 $
54,970,112
36,873,389
18,480,683
2,000,999
1,479,995
1,561,257
1,469,090
3,422,606
1,574,663
2,562,331
2,483,857
256,579,671
249,497,151
360,215,550 329,955,551
11,354,604 20,850,011
$ 371,570,254 $ 350,805,562
$ 70,402,558 $
62,455,776
10,475,000
10,475,000
223,886,656
216,227,752
6,451,500
4,026,500
57,742,668
55,095,554
2,611,872
2,524,880
$ 371,570,254 $ 350,805,562
(a) This schedule presents only the capital asset balances related to govemmental funds,
including infrastructure. Accordingly, the capital assets reported in the internal service
funds are excluded from the above amounts. Generally, the capital assets of internal
service funds are included as governmental activities in the statement of net assets.
105
CITY OF ALLEN, TEXAS
SCHEDULE OF CAPITAL ASSETS USED IN THE OPERATION OF
GOVERNMENTAL FUNDS - BY FUNCTION AND ACTIVITY (a)
AS OF SEPTEMBER 30, 2003
PUBLIC SAFETY
Land
Machinery &
Function and Activity
Land Improvements
Buildings
Equipment
Fire
6.858,585
587,027
GENERAL GOVERNMENT
13,133,735
792,876
Municipal court
$ 631,788 $ $
289,669 $
City administration
523,621
8,820,247
21,164
Information technology
93.988
Total general government
1,155,409
9,109,916
115,152
PUBLIC SAFETY
Police
6,475,150
205,849
Fire
6.858,585
587,027
Total public safety
13,133,735
792,876
PUBLIC WORKS
Community services 6 streets
50,940,632
319,024
Engineering
21,397
Total public works
50,940,632
340.421
CULTURE If RECREATION
Perks 8 recreation
4,277,200
$42,156 12,734,660
627,871
Library
1,895,078
Total culture& recreation
4,277,200
842,156 14,629,738
627,871
COMMUNITY DEVELOPMENT
Building and code compliance
Planning 6 development
6,993
Total community development
6,993
GRANT ADMINISTRATION
Grant administration
117,686
Total grant administration
117,666
Construction In Progress
Total governmental funds capital assets $ 56,373,241 $_ a42, 156 $_ 36,873,389 $ 2,000,999
(a) This schedule presents only the capital asset balances related to governmental funds,
including infrastructure. Accordingly, the capital assets reported in the internal service
funds are excluded from the above amounts. Generally, the capital assets of internal
service funds are included as govemmental activities in the statement of net assets.
106
EXHIBIT F-2
Furniture 8
779,025
Other Conshuctlon In
216,974
Fh4ures
Vehicles
Backs Improvements Pmress
Tote!
11,000 16 784,675
23,684,794
$ $
$
$ $ $
921,457
818,459
10,183,491
14,565
9,682
222,321
340,556
833,024
9,682
222,321
11,45,504
213.330
779,025
11.000 7,684,354
216,974
1,637,735
9100,321
430,304
2,416,760
11,000 16 784,675
223,788 256,326,350 307,809.794
17,701 154,619 193,717
17,701 378,407 256,326,350 308,003,511
280,228
445,270
2,562,331
20,000
19,227,385
4,457,409
280,228
445,270
2,562,331
20,000
23,684,794
135,515 135,515
6,993
135,515 142.508
36,972 164,658
36,972 154,668
11,354,604 11,354,604
11,364,604 11,354,604
$ 1,561,257 $ 3,422,606 $ 2,562,331 $ 256579.671 $ 11,354,604 $ 371,570,254
107
CRY OF ALLEN, TEXAS
SCHEDULE OF CHANGES IN CAPITAL ASSETS USED IN THE OPERATION
OF GOVERNMENTAL FUNDS - BY FUNCTION AND ACTIVITY (a)
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2003
EXHIBIT F-3
G xmnemzl Finds
GovemmenMl Funds
Cap11stA w Developer
CapulAssts
Function and Ac6vly
0c1aMr1,2002 CantiWtlone
Addition
Drlduclbc
Tranabn
September W. 2003
GENERAL GOVERNMENT
Municipal count
i 921,457 i S
i S
S
921,457
Gyadminlatrabon
9,82$580
313.292
(58,381)
10,189,491
infwmadm feUnndogy
127.012 213,514
340,558
Tolalgenerelgovemment
1019771058
528.808
(5&381)
11.445,504
PUBLIC SAFETY
'
Pdloe
3,208,354
87.255
(52084)
4,442,798
7,654.351
R.
4,975,832
41,4
4,063,067
9.100.321
Total pudic safety
&162188
126]08
(szom)
11,525,865
16,784,875
PUBLIC WORKS
Community semloss&sheets
2811,0119,287 2.142.321
491,872
7,088,314
307,809.794
EnglreeNq
184,480
9.257
193,717
TWalpuMcvor,s
2811,273,747 2,142321
501,129
7,088,314
sO8pG9511
CULTURE & RECREATION
Parka &raueaWn
7,964,720 276.395
251,197
(52.009)
10.787.155
19227,385
LIOmry
4,423219
98,547
(61.357)
4.457.409
Tdal culture &mcreagon
12,387.939 278,396
349.744
(11614401
10.787,155
23,684,794
COMMUNITY DEVELOPMENT
Building & code compliance
123.127
12,388
135,515
PlannIM&development
11,493
(4.500)
8,983
Total community developauxt
134.820
12,388
(4.500)
142,506
GRANTADMINI5TRATICN
Grentadminisbagon
154.858
154.658
Total grant administra8on
154,658
1%,858
Total general fixed assets
allocated by function
3291955.551 2,418,717
1,e79,433
(231,385)
28,399.334
380,215,650
Construction In pn,rasa
2%850,011
18,90.9,927
W13"A34)
11.354,804
Tal& govemmandal funds
ppibl .arae%
S 350.805,562 $ 2418.717 $
18.577.360
$ (2313651 S
i371570251
(a) This schedule presents only the capital asset balances related to governmental funds,
including Infrastructure. Accordingly, the capital assets reported in the internal service
funds are excluded from the above amounts. Generally, the capital assets of internal
service funds are included as governmental activities in the statement of net assets.
108
Statistical
Section
(Unaudited)
STATISTICAL SECTION
(UNAUDITED)
109
CITY OF ALLEN, TEXAS
GENERAL GOVERNMENTAL EXPENDITURES BY FUNCTION (Note A) (UNAUDITED)
LAST TEN FISCAL YEARS
FISCAL
GENERAL
PUBLIC
PUBLIC
CULTURE AND
YEAR
GOVERNMENT
SAFETY
WORKS
RECREATION
1994
$ 892,067 $
33,524,883 $
499,867 $
1,143,493
1995
1,534,808
4,028,945
541,827
1,465,860
1996
1,257,365
4,339,685
542,141
17,648,576
1997
1,788,174
5,620,122
585,179
2,133,283
1998
2,126,443
6,911,125
675,079
2,541,508
1999
2,657,125
8,006,330
854,907
2,913,149
2000
3,714,436
9,063,625
1,963,195
3,390,150
2001
4,051,058
10,896,606
2,354,777
4,554,158
2002
5,091,234
12,813,503
2,629,347
4,996,149
2003
5,210,352
13,559,651
2,444,021
7,977,612
(A) Includes General, Special Revenue and Debt Service Funds.
(B) Prior to 2003, grants were allocated to the category in which they were awarded rather than
being in their own category.
110
COMMUNITY
DEVELOPMENT
$ 456,149 $
545,331
587,059
674,604
748,510
618,812
1,230,318
1,242,795
1,949,561
1,492,952
GRANTS CAPITAL
ADMIN B OUTLAY
1,025,141
156,959
758,278
980,289
678,761
254,693
1,153,095
2,250
1,004,720
330,872
111
DEBT
SERVICE
2,403,619 $
3,005,147
3,007,485
3,620,852
3,643,055
4,451,686
5,545,171
6,813,770
8,124,934
9,143,031
TABLE 1
TOTAL
38,920,078
11,280,877
28,140,589
15,402,503
17,324,481
19,756,702
26,059,990
29,915,414
36,609,448
41,183,632
CITY OF ALLEN, TEXAS
GENERAL GOVERNMENTAL REVENUES BY SOURCE (Note A) (UNAUDITED)
LAST TEN FISCAL YEARS
FISCAL
LICENSES
INTER-
CHARGES FOR
YEAR
TAXES (B)
AND PERMITS
GOVERNMENTAL
SERVICES
1994
$ 8,563,016 $
706,120
$ 28,121
$ 92,418
1995
9,200,266
615,891
9,293
1996
10,757,710
922,138
112,972
1997
12,002,526
1,026,175
243,417
1998
13,976,651
1,842,603
287,020
1999
16,607,129
2,006,937
358,597
2000
20,255,520
1,733,140
992,672
2001
25,292,740
1,896,867
538,761
1,288,629
2002
29,715,372
1,484,888
896,321
1,147,409
2003
33,593,070
1,364,939
794,840
2,587,674 (D)
(A) Includes General, Special Revenue and Debt Service Funds.
(B) Includes ad valorem, penalty and interest, franchise, hotel and sales taxes -
General, Special Revenue, and Debt Service Funds.
(C) Includes gifts and contributions.
(D) Includes recreation fees.
112
TABLE 2
FINES AND
GIFTS AND
FORFEITURES
CONTRIBUTIONS
INTEREST
MISCELLANEOUS
TOTAL
$ 177,323
$ $
209,376
$ 711,445
(C) $
10,487,819
202,345
420,387
866,113
(C)
11,314295
310,318
473,570
510,363
(C)
13,087,071
332,385
451,499
909,111
(C)
14,965,113
465,756
685,217
521,151
459,825
18,238,223
671,934
254,693
478,640
653,506
21,031,436
738,005
1,158,765
1,000,208
1,099,644
26,977,954
1,007,666
2,250
918,055
641,851
31,586,819
1,179,269
1,004,720
436,605
636,367
36,700,951
1,428,274
283,019
404,082
795,785
41,251,683
113
CITY OF ALLEN, TEXAS
AD VALOREM TAX LEVIES AND COLLECTIONS (UNAUDITED)
LAST TEN FISCAL YEARS
FISCAL
TOTAL
YEAR
TAX LEVY
OF LEVY
1994
$ 5,770,930 $
1995
6,380,680
1996
7,139,479
1997
8,092,555
1998
9,107,745
1999
10,823,366
2000
13,100,263
2001
16,070,978
2002
19,396,752
2003
22,912,250
(A) Includes penalty and interest collections. Such amounts are recorded with
ad valorem tax revenue in the basic financial statements.
114
PERCENT
DELINQUENT
CURRENTTAX
OF LEVY
TAX
COLLECTIONS
COLLECTED
COLLECTIONS
5,770,699
100.00
$ 14,349
6,363,231
99.73
19,016
7,142,679
100.04
50,451
8,056,575
99.56
80,355
9,102,700
99.94
27,067
10,762,014
99.43
68,580
13,043, 521
99.57
103,623
16,051,072
99.88
152,450
19,318,306
99.60
272,200
22,676,871
98.97
445,044
(A) Includes penalty and interest collections. Such amounts are recorded with
ad valorem tax revenue in the basic financial statements.
114
TABLE 3
115
PERCENT OF
PERCENT OF
TOTALTAX
OUTSTANDING
OUTSTANDING
TOTALTAX
COLLECTIONS
DELINQUENT
DELINQUENT
COLLECTIONS (A)
TO TAX LEVY
TAXES
TAXES TO TAX LEVY
$ 5,785,046
100.87
$ 6,349
0.11
6,382,247
99.65
4,626
0.07
7,193,130
100.06
8,158
0.11
8,136,930
99.57
12,131
0.15
9,129,767
99.81
38,701
0.42
10,830,594
100.36
72,467
0.67
13,147,144
100.36
56,244
0.43
16,203,522
100.82
104,596
0.65
19,590,506
101.00
179,172
0.92
23,121,915
100.92
231,153
1.01
115
CITY OF ALLEN, TEXAS TABLE 4
ASSESSED AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY (UNAUDITED)
LAST TEN FISCAL YEARS
(1) Represents total assessed value before expiration.
116
REAL AND
ESTIMATED
PERSONAL
VALUE
PROPERTY
FISCAL
ASSESSED
YEAR
VALUE (1)
1994
$ 779,885,438
1995
891,654,515
1996
1,073,605,805
1997
1,248,851,016
1998
1,566,233,175
1999
1,882,324,508
2000
2,287,107,121
2001
2,849,399,418
2002
3,445,805,987
2003
4,076,548,994
(1) Represents total assessed value before expiration.
116
PERCENTAGE OF
ESTIMATED
TOTAL ASSESSED TO
VALUE
TOTAL ESTIMATED
$ 779,885,438
100
891,654,515
100
1,073,605,805
100
1,248,851,016
100
1,566,233,175
100
1,882,324,508
100
2,287,107,121
100
2,849,399,418
100
3,445,805,987
100
4,076,548,994
100
(1) Represents total assessed value before expiration.
116
CITY OF ALLEN, TEXAS
TABLE 5
PROPERTY TAX RATES -
DIRECT AND OVERLAPPING GOVERNMENTS (UNAUDITED)
LAST TEN FISCAL YEARS
COLLIN
COUNTY
DEBT
COMMUNITY
TAX
GENERAL
SERVICE
ALLEN
COLLIN
COLLEGE
YEAR
FUND
FUND
TOTAL
I.S.D.
COUNTY
DISTRICT
TOTAL
1994
$ 0.431200$
0.308800$
0.74000
1.668600$
0.2600$
0.09855$
2.76715
1995
0.378050
0.337550
0.71560
1.668600
0.2600
0.09855
2.74275
1996
0.383710
0.281290
0.66500
1.605000
0.2600
0.09855
2.62855
1997
0.358430
0.289570
0.64800
1.690000
0.2600
0.09855
2.69655
1998
0.348670
0.231910
0.58058
1.661100
0.2600
0.09855
2.60023
1999
0.350050
0.224950
0.57500
1.736900
0.2500
0.09888
2.66078
2000
0.346030
0.227970
0.57400
1.762040
0.2500
0.09405
2.68009
2001
0.348170
0.215830
0.56400
1.831416
0.2500
0.092843
2.73826
2002
0.357050
0.205950
0.56300
1.808203
0.2500
0.091946
2.71315
2003
0.354380
0.207620
0.56200
1.806203
0.2500
0.091946
2.71215
Note: Rates are based per $100 valuation.
In 1992, a new taxing entity (County Education District) was established by the State of Texas. County
education district taxes were initially levied and collected during fiscal year 1993. The legislation which
created County education districts was declared unconstitutional by the Texas Supreme Court, and a
new State funding method was enacted for fiscal year 1995.
117
CITY OF ALLEN, TEXAS
RATIO OF NET GENERAL BONDED DEBT TO TAXABLE VALUE
AND NET BONDED DEBT PER CAPITA (UNAUDITED)
LAST TEN FISCAL YEARS
(A) Source: Census results/North Central Texas Council of Governments.
(B) Includes all general obligation bonds.
(C) Represent assessed value less exemptions.
118
GROSS
GENERAL
FISCAL
ESTIMATED
TAXABLE
BONDED
YEAR
POPULATION (A)
VALUE (C)
DEBT (B)
1994
24,493
$ 779,885,438
$ 20,798,921
1995
27,219
891,654,515
26,398,921
1996
29,468
1,073,605,805
32,033,921
1997
32,539
1,248,851,016
30,323,921
1998
35,744
1,566,233,175
38,413,921
1999
43,686
1,882,324,508
49,608,921
2000
48,308
2,287,107,121
59,117,730
2001
54,421
2,849,399,418
68,409,064
2002
58,790
3,445,805,987
78,007,619
2003
63,643
4,076,548,994
79,243,921
(A) Source: Census results/North Central Texas Council of Governments.
(B) Includes all general obligation bonds.
(C) Represent assessed value less exemptions.
118
LESS DEBT
SERVICE
FUND
$ 469,120
594,510
765,253
838,686
1,017,694
937,386
833,788
848,466
1,040,735
1,377,670
Id
NET
BONDED DEBT
20,329,801
25,804,411
31,268,668
29,485,235
37,396,227
48,671,535
58,283,942
67,560,598
76,966,884
77,866,251
RATIO OF
NETBONDED
DEBT TO
TAXABLE VALUE
0.02607
0.02894
0.02912
0.02361
0.02388
0.02585
0.02548
0.02371
0.02234
0.01910
119
TABLE 6
NET
BONDED DEBT
PER CAPITA
$ 830.02
1,061.11
906.15
1,046.22
1,114.12
1,206.51
1,241.44
1,309.18
1,223.48
CITY OF ALLEN, TEXAS TABLE 7
RATIO OF ANNUAL DEBT SERVICE EXPENDITURES TO
GENERAL BONDED DEBT TO TOTAL GENERAL GOVERNMENTAL EXPENDITURES(UNAUDITED)
LAST TEN FISCAL YEARS
FISCAL
RATIO OF DEBT
YEAR
PRINCIPAL
INTEREST
1994
$ 1,105,000
$ 1,294,973 $
1995
1,195,000
1,204,232
1996
1,465,000
1,539,912
1997
1,710,000
1,906,985
1998
1,927,980
1,715,075
1999
2,145,000
2,306,686
2000
2,830,000
2,715,171
2001
3,469,803
3,343,966
2002
3,725,000
3,715,129
2003
4,370,000
4,018,210
(A) Includes General, Special Revenue and Debt Service Funds.
120
RATIO OF DEBT
SERVICE TO
TOTAL GENERAL
GENERAL
TOTAL DEBT
GOVERNMENTAL
GOVERNMENTAL
SERVICE
EXPENDITURES
EXPENDITURES
2,399,973
$ 8,920,078
26.91%
2,399,232
11,260,877
21.31%
3,004,912
12,256,870
24.52%
3,616,985
15,402,503
23.48%
3,643,055
17,324,481
21.03%
4,451,686
19,756,702
22.53%
5,545,171
24,828,513
22.33%
6,813,769
29,754,166
22.90%
7,440,129
35,331,608
21.06%
8,388,210
41,133,632 (A)
20.39%
(A) Includes General, Special Revenue and Debt Service Funds.
120
CITY OF ALLEN, TEXAS
COMPUTATION OF LEGAL DEBT MARGIN (UNAUDITED)
SEPTEMBER 30,2003
TABLE 8
Article XI, Section 5 of the Texas Constitution, applicable to cifies of more than 5,000 population: $2.50
per $100.00 assessed valuation. The City Charter of the City of Allen, Texas, does not provide for a
debt limit. The City tax rate of $0.56200 per $100.00 assessed valuation is 22.48% of the constitutional
limit for operation and debt service.
121
CITY OF ALLEN, TEXAS
COMPUTATION OF DIRECT AND OVERLAPPING DEBT (UNAUDITED)
SEPTEMBER 30,2003
TABLE 9
Plano I.S.D.
732,198,140
PERCENTAGE
AMOUNT
Collin County
200,594,997
APPLICABLE TO
APPLICABLE TO
Collin County Community College District
GROSS DEBT
THE CITY OF
THE CITY OF
OUTSTANDING (A)
ALLEN
ALLEN
City of Allan
$ 79,243,921
100%
$ 79,243,921
Total direct debt
79,243,921
79,243,921
Alien I.S.D.
206,823,648
95%
196,482,466
Plano I.S.D.
732,198,140
0.9%
6,589,783
Collin County
200,594,997
8.90%
17,852,955
Collin County Community College District
28,172,129
8.90%
2,507,319
Total overlapping debt
1,167,788,914
223,432,523
Total direct and overlapping debt $
1,247,032,835
E 302,676,444
Average debt per capita $
19,594
(A) Includes all general obligation debt which is to be repaid from property tax collections.
CITY OF ALLEN, TEXAS TABLE 10
PROPERTY VALUES AND CONSTRUCTION (UNAUDITED)
LAST TEN FISCAL YEARS
(A) Source: City of Allen -Building Inspections (includes all permits)
(B) Includes new construction, alterations, add-ons and improvements.
123
CONSTRUCTION (A)
TOTAL
FISCAL
ASSESSED
NUMBER
COMMERCIAL
NUMBER
RESIDENTIAL
YEAR
VALUE
PERMITS
VALUE
OF PERMITS
VALUE(B)
1994
$ 779,885,438
332
$ 9,239,371
2,411
$ 119,699,855
1995
891,654,515
333
13,491,728
2,259
104,305,165
1996
1,073,605,805
319
36,369,959
2,803
164,855,137
1997
1,248,851,016
386
75,998,593
2,487
158,480,566
1998
1,566,233,175
468
56,481,429
3,36D
209,691,408
1999
1,882,324,508
133
116,245,279
1,298
209,732,070
2000
2,287,107,121
252
105,883,860
1,425
244,820,111
2001
2,849,399,418
197
73,483,501
2,257
586,583,500
2002
3,445,805,987
202
50,759,762
1,456
277,808,123
2003
4,076,548,994
218
39,705,007
3,706
238,064,000
(A) Source: City of Allen -Building Inspections (includes all permits)
(B) Includes new construction, alterations, add-ons and improvements.
123
CITY OF ALLEN, TEXAS
TABLE 11
PRINCIPAL TAXPAYERS (UNAUDITED)
SEPTEMBER 30,2003
PERCENTAGE OF
2002
TAXABLE ASSESSED
TAXPAYER
TYPE OF BUSINESS
VALUATION
VALUATION
Chelsea Allen Development LP
Commercial Real Estate
$ 45,057,024
1.11%
OncorfTXU/Lone Star Gas
Gas Utility
35,210,984
0.86%
Wells Operating Partnership
Commercial Real Estate
34,963,145
0.86%
Southwestern Bell/SBC
Telephone Utility
30,737,561
0.75%
Janice Brittingham
Real Estate
28,708,816
0.70%
Meridian Settlers' Gate, L.P.
Apartment Complex
25,988,633
0.64%
Alcatel USA
Telecommunications
25,296,740
0.62%
Benton Pointe/Sentinel R.E.
Apartment Complex
25,000,000
0.61%
Sunbelt Telecommunications
Telecommunications
23,539,793
0.58%
Twin Creeks Village LP
Retail
21,580,689
0.53%
Total
7.26%
$ 296,083,385
124
CITY OF ALLEN, TEXAS
MISCELLANEOUS STATISTICAL FACTS (UNAUDITED)
SEPTEMBER 30, 2003
TABLE 12
Date of Incorporation
July 1, 1953
Form of Government
Council/Manager
Area
27.1059 square miles
Miles of street
251 center line miles
Population estimate (2003)
63,643
Fire Protection:
classes held at the High School
Number of stations
4
Number of personnel
84
Number of fire hydrants
2547
Police Protection:
Number of stations
1
Number of personnel
118
Water Service:
Supplier
North Texas Municipal Water District
Number of consumers
20,758
Average daily consumption
10,426,000
Miles of water lines
307 linear miles
Sewer Service:
Sanitary sewer lines
236 linear miles
Storm sewer lines
83 linear miles
Building Permits Issued (A)
5,065
Parks:
Number
35
Area
720 acres
Municipal Employees:
Full-time equivalent
502.35
Public Education
Total Enrollment
13,798
Number of Schools
Elementary ( K - 6)
11
Middle School (7 & 8)
2
Freshman Center (9)
1
High School (10 - 12)
1
Community College
classes held at the High School
(A) Includes residential, commercial, and miscellaneous (e.g. pools, fences) permits
125
CITY OF ALLEN, TEXAS
DEMOGRAPHIC STATISTICS (UNAUDITED)
LAST TEN FISCAL YEARS
TABLE 13
126
FISCAL
ESTIMATED
PER CAPITA
SCHOOL
YEAR
POPULATION (A)
INCOME (B)
ENROLLMENT (C)
1994
24,493 $
16,040
6,895
1995
27,219
16,040
7,531
1996
29,468
16,040
8,199
1997
32,539
16,040
8,781
1998
35,744
16,040
9,453
1999
43,686
16,040
9,940
2000
48,308
16,040
10,595
2001
54,421
40,068
11,519
2002
58,790
40,068
12,380
2003
63,643
40,068
13,798
(A)
Estimates by City, review of available census data and review of various City records.
(B)
Source:
North Dallas Chamber of Commerce/North Central Texas Council of Governments.
Updated every 10 years from census study.
(C)
Source:
Allen Independent School District.
126
CITY OF ALLEN, TEXAS
COMMUNICATION OF INTERNAL CONTROL STRUCTURE
RELATED MATTERS NOTED DURING THE AUDIT
FOR THE YEAR ENDED SEPTEMBER 30, 2003
DAUAI
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WWWMEMBER
EAVERANDTIDWELLDOF
EPENDENT
BAKER TILLY
However, during our audit, we noted certain matters involving accounting internal control
structure and other operational matters that are presented for your consideration. These
matters, which were considered by us during our audit of the financial statements and do
not modify the opinion expressed in our report dated February 27, 2004, are presented in
the following paragraphs. We will review the status of these comments during our next
audit engagement. Our Comments and recommendations are intended to improve the
internal control structure or result in other operating efficiencies. Additionally, we
evaluated the status of the comments from our audit of the previous year.
CURRENT COMMENTS
Procedures for Using Charge Accounts
Observation:
During our audit of controls over cash disbursements, we noted instances where procedures
for submitting receipts following the use of the City's charge cards were not followed. As a
result, the City's funds can be disbursed for non -allowable activities and such disbursements
may not be in Compliance with applicable laws and regulations.
Recommendation:
We recommend that the City review its purchasing policies and procedures to ensure that
disbursements are conducted in the proper manner.
March 8, 2004
1
WEAVER
' TIDWELL
To the Honorable Mayor,
L c a
City Council and City Manager
CERTIFIED PUBLIC
City of Allen, Texas
ACCOUNTANTS
AND CONSULTANTS
Management of the City of Allen, Texas (the "City") is responsible for establishing and
maintaining the City's 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 the 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 general
purpose financial statements in accordance with generally accepted accounting
principles. Because of inherent limitations in any internal control structure, errors or
irregularities may occur and not be detected. Also, projection of any evaluation of the
internal structure to future periods is subject to the risk it may become inadequate
'
because of changes in conditions or deterioration in its operating effectiveness.
In planning and performing our audit of the financial statements of the City of Allen for the
'
year ended September 30, 2003, we considered its internal control structure in order to
determine our auditing procedures for the purpose of expressing our opinion on the
financial statements and not to provide assurance on the internal control structure. Our
report on compliance and on internal control over financial reporting is documented in a
'
separate letter dated February 27, 2004.
DAUAI
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BAKER TILLY
However, during our audit, we noted certain matters involving accounting internal control
structure and other operational matters that are presented for your consideration. These
matters, which were considered by us during our audit of the financial statements and do
not modify the opinion expressed in our report dated February 27, 2004, are presented in
the following paragraphs. We will review the status of these comments during our next
audit engagement. Our Comments and recommendations are intended to improve the
internal control structure or result in other operating efficiencies. Additionally, we
evaluated the status of the comments from our audit of the previous year.
CURRENT COMMENTS
Procedures for Using Charge Accounts
Observation:
During our audit of controls over cash disbursements, we noted instances where procedures
for submitting receipts following the use of the City's charge cards were not followed. As a
result, the City's funds can be disbursed for non -allowable activities and such disbursements
may not be in Compliance with applicable laws and regulations.
Recommendation:
We recommend that the City review its purchasing policies and procedures to ensure that
disbursements are conducted in the proper manner.
I
Manaoement's Response:
' All of the City's water accounts run in cycle 5 and are set up to bill each department one
day and then pay the Water & Sewer fund the next day. This automated process creates
a payable to the Water & Sewer Fund which should zero out each cycle. Researching
' this process we found that several of the parks water accounts had incorrect billing
codes, resulting in the software creating the bill but not paying it off. The codes were
corrected in January 2004. The automated entries are now checked each time to
guarantee the amounts zero out
' Status of Prior Year Comments
' Accompanying this letter is a summary of the status of prior year comments, which should
be read along with our current observations and recommendations.
Concluding Comments
' We appreciate the opportunity to be of service and wish to express our appreciation to the
officials and employees of the City for their cooperation and assistance during the course of
' the audit. We would be pleased to discuss these recommendations in greater detail or
otherwise assist in their implementation.
This report is intended solely for the information and use of the City council, management,
and others within the organization.
WEAVER AND TIDWELL, L.L.P.
CITY OF ALLEN, TEXAS
March 8, 2004
Page Two
Management's Response:
In December 2003 the Finance department updated the Accounts Payable and Travel
'
policies. Both policies state that detailed original receipts are required for documenting
purchases while conducting City business. Training sessions were held to educate
employees of the new policies and the Finance department is monitoring compliance.
'
The Purchasing
department has also developed a procurement card program to be
implemented this spring, whereby authorized users must follow strict purchasing and
reconciliation guidelines. A formal policy will provide guidance to employees and
establish formal processes to ensure that disbursements
purchases and are conducted in
the proper manner.
'
Utilities Payable
Observation:
During the current year, we noted that the general fund's Utility Bill Payable account carried
'
an unsupported debit balance at year's end. Based on the nature and purpose of this
account, it appears that the water and sewer fund is not receiving the proper credits for
charges made to other City departments via automated cycle billings.
'
Recommendation:
We recommend that the City review the operations of the utility billing system and take
corrective action to ensure that the affected accounts reflect the correct balances at all
'
times.
Manaoement's Response:
' All of the City's water accounts run in cycle 5 and are set up to bill each department one
day and then pay the Water & Sewer fund the next day. This automated process creates
a payable to the Water & Sewer Fund which should zero out each cycle. Researching
' this process we found that several of the parks water accounts had incorrect billing
codes, resulting in the software creating the bill but not paying it off. The codes were
corrected in January 2004. The automated entries are now checked each time to
guarantee the amounts zero out
' Status of Prior Year Comments
' Accompanying this letter is a summary of the status of prior year comments, which should
be read along with our current observations and recommendations.
Concluding Comments
' We appreciate the opportunity to be of service and wish to express our appreciation to the
officials and employees of the City for their cooperation and assistance during the course of
' the audit. We would be pleased to discuss these recommendations in greater detail or
otherwise assist in their implementation.
This report is intended solely for the information and use of the City council, management,
and others within the organization.
WEAVER AND TIDWELL, L.L.P.
CITY OF ALLEN, TEXAS
March 8, 2004
Page Three
STATUS OF PRIOR YEAR COMMENTS
The status of prior year's recommendations is based upon discussion with management and limited review of
their implementation. Such recommendations were reported to the City Council and are more fully described
in prior year's Communication of Internal Control Structure Related Matters Noted during the Audit.
Recommendations
1. We recommended that the City reconcile the
sidewalk escrow subsidiary ledger to the
respective general ledger account balance
on a regular basis. In the event construction
for which escrow funds were deposited were
not paid for by the City, the City needs to
determine the specific amounts of escrowed
funds, plus accrued interest, that need to be
funded to each respective owner, upon request
2. We recommended that payments of principal
and related interest be recorded in specific
accounts titled "debt service or capital lease
payments" so they may be easily identifiable
in the general ledger.
Implementation
Implemented Not Implemented In Process
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'
CITY OF ALLEN, TEXAS
UNIFORM GRANTS MANAGEMENT
STANDARDS REPORT
'
YEAR ENDED SEPTEMBER 30, 2003
1
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' TABLE OF CONTENTS
Page
Independent Auditor's Report on Compliance and on Internal Control
Over Financial Reporting Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards 1
Independent Auditor's Report on Compliance with Requirements Applicable
' To Each Major Federal Program, Internal Control Over Compliance,
And Schedule of Expenditures of Federal and State Awards 3
Schedule of Findings and Questioned Costs 4
Schedule on Prior Audit Findings 6
' Supplementary Information:
Schedule of Expenditures of Stale Awards 7
' Notes to Schedule of Expenditures of State Awards 8
1
1
1
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE AND ON INTERNAL
AND CONSULTANTS Allen, Texas
We have audited the financial statements of The City Of Allen (the City) as of and for the
year ended September 30, 2003, and have issued our report thereon dated February 27,
2004. We conducted our audit in accordance with generally accepted auditing standards
and the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether the City's financial statements
are free of material misstatement, we performed tests of its compliance with certain
provisions of laws, regulations, contracts and grants, noncompliance with which could
have a direct and material effect on the determination of financial statement amounts.
However, providing an opinion on Compliance with those provisions was not an objective
of our audit and, accordingly, we do not express such an opinion. The results of our tests
disclosed no instances of noncompliance that are required to be reported under
Government Auditing Standards.
CONTROL G BASED ON AN AUDIT OF
I I I
FINAN STATEMENTSIN ACC R ANCE
PERFORMEDTAUDITING
TIAL
ITH E
WEAVER
expressing our opinion on the basic financial statements and not to provide assurance on
TIDWELL
the internal control over financial reporting. Our Consideration of the internal control over
c.c P.
To the Honorable Mayor,
City Council and City Manager
ccanr¢D vueuc
ADCOUNTANTS
City Of Allen
AND CONSULTANTS Allen, Texas
We have audited the financial statements of The City Of Allen (the City) as of and for the
year ended September 30, 2003, and have issued our report thereon dated February 27,
2004. We conducted our audit in accordance with generally accepted auditing standards
and the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether the City's financial statements
are free of material misstatement, we performed tests of its compliance with certain
provisions of laws, regulations, contracts and grants, noncompliance with which could
have a direct and material effect on the determination of financial statement amounts.
However, providing an opinion on Compliance with those provisions was not an objective
of our audit and, accordingly, we do not express such an opinion. The results of our tests
disclosed no instances of noncompliance that are required to be reported under
Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the Council's internal control over
financial reporting in order to determine our auditing procedures for the purpose of
expressing our opinion on the basic financial statements and not to provide assurance on
the internal control over financial reporting. Our Consideration of the internal control over
financial reporting would not necessarily disclose all matters in the internal control over
financial reporting that might be material weaknesses. A material weakness is a Condition
in which the design or operation of one or more of the internal Control components does
not reduce to a relatively low level the risk that misstatements in amounts that would be
material in relation to the financial statements being audited may occur and not be
detected within a timely period by employees in the normal course of performing their
DALLAS
assigned functions. We noted no matters involving the internal control over financial
11.., I". PL¢v
reporting and its operation that we consider to be material weaknesses.
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This report is intended for the information and use of management, state awarding
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agencies and pass-through entities, and is not intended to be and should not be used by
anyone other than these specified parties.
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WEAVER AND TIDWELL, L.L.P.
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Dallas, Texas
Ax INDEPENDENT D WF
February 27, 2004
11
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH REQUIREMENTS
We have audited the compliance of the City of Allen, Texas (the City) with the types of
compliance requirements described in the Uniform Grants Management Standards issued
by the Governors Office of Budget and Planning that are applicable to each of its major
state programs for the year ended September 30, 2003. The City's major state programs
are identified in the summary of auditor's results section of the accompanying schedule of
audit findings. Compliance with the requirements of laws, regulations, contracts and
grants applicable to each of its major state programs is the responsibility of the City's
management. Our responsibility is to express an opinion on the City's compliance based
on our audit.
We conducted our audit of compliance in accordance with auditing standards generally
accepted in the United States of America; the standards applicable to financial audits
contained in Government Auditing Standards, issued by the Comptroller General of the
United States; and Uniform Grant Management Standards issued by the Governors Office
of Budget and Planning. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether noncompliance with the types of compliance
requirements referred to above that could have a direct and material effect on a major
state program occurred. An audit includes examining, on a test basis, evidence about the
City's compliance with those requirements and performing such other procedures, as we
considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion. Our audit does not provide a legal determination on the
City's compliance with those requirements.
In our opinion, the City Complied, in all material respects, with the requirements referred to
above that are applicable to each of its major state programs for the year ended
September 30, 2003.
' Internal Control Over Compliance
mss
Management of the City is responsible for establishing and maintaining effective internal
'
1222+11"1,11control over compliance with requirements of laws, regulations, contracts and grants
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r...:>zn -sxn applicable to state programs. In planning and performing our audit, we Considered the
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„-o City's internal control over compliance with requirements that could have a direct and
xr2r material effect on a major state program in order to determine our auditing procedures for
' the purpose of expressing our opinion on Compliance and to test and report on internal
r°”' W.— control over compliance in accordance with Uniform Grant Management Standards issued
iaon %„ s -,,,,h 5—, by the Governor's Office of Budget and Planning.
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APPLICABLE TO CH MAJOR M, INTERNAL CONTROL OVER
NSLDNCE IN SORDANCE WITHGRANSTATE
MANAGEMENTIII
STANDARDS ANDHE LLE FEXPDIITUR OF AWARDS
WEAVER
TIDWELL
To the Honorable Mayor,
r_Lv
City Council and City Manager
City Of Allen
CERTIFIED rUei
p«oxxTA„Ts
Allen, Texas
ADD caxsULTAnrs
Compliance
We have audited the compliance of the City of Allen, Texas (the City) with the types of
compliance requirements described in the Uniform Grants Management Standards issued
by the Governors Office of Budget and Planning that are applicable to each of its major
state programs for the year ended September 30, 2003. The City's major state programs
are identified in the summary of auditor's results section of the accompanying schedule of
audit findings. Compliance with the requirements of laws, regulations, contracts and
grants applicable to each of its major state programs is the responsibility of the City's
management. Our responsibility is to express an opinion on the City's compliance based
on our audit.
We conducted our audit of compliance in accordance with auditing standards generally
accepted in the United States of America; the standards applicable to financial audits
contained in Government Auditing Standards, issued by the Comptroller General of the
United States; and Uniform Grant Management Standards issued by the Governors Office
of Budget and Planning. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether noncompliance with the types of compliance
requirements referred to above that could have a direct and material effect on a major
state program occurred. An audit includes examining, on a test basis, evidence about the
City's compliance with those requirements and performing such other procedures, as we
considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion. Our audit does not provide a legal determination on the
City's compliance with those requirements.
In our opinion, the City Complied, in all material respects, with the requirements referred to
above that are applicable to each of its major state programs for the year ended
September 30, 2003.
' Internal Control Over Compliance
mss
Management of the City is responsible for establishing and maintaining effective internal
'
1222+11"1,11control over compliance with requirements of laws, regulations, contracts and grants
c,,,,
uerc-i25
r...:>zn -sxn applicable to state programs. In planning and performing our audit, we Considered the
k,
„-o City's internal control over compliance with requirements that could have a direct and
xr2r material effect on a major state program in order to determine our auditing procedures for
' the purpose of expressing our opinion on Compliance and to test and report on internal
r°”' W.— control over compliance in accordance with Uniform Grant Management Standards issued
iaon %„ s -,,,,h 5—, by the Governor's Office of Budget and Planning.
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City of Allen, Texas
February 27, 2004
Page 2
Our consideration of the internal control over compliance would not necessarily disclose all
matters in the internal control that might be material weaknesses. A material weakness is
a condition in which the design or operation of one or more of the internal control
components does not reduce to a relatively low level the risk that noncompliance with
applicable requirements of laws, regulations, contracts and grants that would be material
in relation to a major state program being audited may occur and not be detected within a
timely period by employees in the normal course of performing their assigned functions.
We noted no matters involving the internal control over compliance and its operation that
we consider to be material weaknesses.
Schedule of Expenditures of State Awards
We have audited the basic financial statements of the City of Allen, Texas as of and for the
year ended September 30, 2003, and have issued our report thereon dated February 27,
2004. Our audit was performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying Schedule of Expenditures of
State Awards is presented for purposes of additional analysis as required by Uniform
Grant Management Standards issued by the Governor's Office of Budget and Planning
and is not a required part of the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basic financial statements,
and, in our opinion, is fairly stated, in all material respects, in relation to the basic financial
statements taken as a whole.
This report is intended for the information and use of management, state awarding
agencies, and pass-through entities, and is not intended to be and should not be used by
anyone other than these specified parties.
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WEAVER AND TIDWELL, L.L.P.
Dallas, Texas
February 27, 2004
CIN OF ALLEN, TEXAS
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED SEPTEMBER 30, 2003
Section I -Summary of Auditors'
Results
• Reportable condition(s) identified
BASIC FINANCIAL STATEMENTS:
that are not considered to be material
An unqualified opinion was issued on the financial statements.
_Yes X None reported
An unqualified opinion was issued on compliance for
Internal control over financial reporting:
Any audit findings disclosed that are
• Material weakness(es) identified?
_Yes
X No
• Reportable condition(s) identified
Identification of State major program(s):
that are not considered to be
Name of State Grant of Program
material weakness(es)?
_Yes
X None reported
Noncompliance material to financial
between type A and type B programs:
$300.000
Statements noted?
_Yes
X No
STATE AWARDS:
Internal control over major programs
• Material weakness(es) identified?
_Yes X No
• Reportable condition(s) identified
that are not considered to be material
weakness(es)?
_Yes X None reported
An unqualified opinion was issued on compliance for
major program.
Any audit findings disclosed that are
required to be reported in accordance
with section 510(a) or Circular A-133?
_Yes X No
Identification of State major program(s):
State Grant Number
Name of State Grant of Program
50-00263
Allen Sports Complex Project
Dollar threshold used to distinguish
between type A and type B programs:
$300.000
Auditee qualified as low-risk auditee?
X Yes _No
4
' CITY OF ALLEN, TEXAS
SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued)
FOR THE YEAR ENDED SEPTEMBER 30, 2003
Section II -Financial Statement Findings
This section identifies the reportable conditions, material weaknesses, and instances of noncompliance
related to the basic financial statements that are required to be reported in accordance with Chapter 5.18 of
Government Auditing Standards.
There were no findings for the year ended September 30, 2003.
' Section III -State Awards Findings and Questioned Costs
This section identifies the reportable conditions, material weaknesses, and instances of noncompliance,
including questioned costs, related to the audit of major state programs, as required to be reported by
Un'rform Grant Management Standards issued by the Governors Office of Budget and Planning (1998).
Where practical, findings should be organized by state agency or pass-through entity.
There were no findings for the year ended September 30, 2003.
11
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CITY OF ALLEN, TEXAS
SCHEDULE OF PRIOR AUDIT FINDINGS
FOR THE YEAR ENDED SEPTEMBER 30, 2003
Findings from the Year Ended, September 30, 2002
Reportable Condition
FINDING # 2002-01 - Sidewalk Escrow Policies and Procedures
Condition: During our audit of the sidewalk escrow liability, we noted that the subsidiary schedule balance did
not reconcile with the general ledger account balance at September 30, 2002. In accordance with section 6.25
of the Allen Land Development Code, escrow policies and procedures, the City is required to maintain sidewalk
escrow deposits made by property owners and developers since these deposits, plus accrued interest, are
refundable to the respective property owners.
Recommendation: We recommended that the City reconcile the sidewalk escrow subsidiary ledger to the
respective general ledger account balance on a regular basis. In the event construction for which escrow
funds were deposited were not paid for by the City, the City needs to determine the specific amounts of
escrowed funds, plus accrued interest, that need to be refunded to each respective owner, upon request.
Current Status: The Finance and Engineering departments have worked in harmony to develop
procedures to reconcile the sidewalk escrow liability. The Engineering department annually reviews
subdivisions over 2-3 years old; upon completion and, if eligible, sidewalk escrow refunds will be
processed accordingly. The Finance department continues to verify that the sidewalk escrow subsidiary
ledger matches the general ledger balance.
SUPPLEMENTARY INFORMATION
CITY OF ALLEN, TEXAS
SCHEDULE OF EXPENDITURES OF STATE AWARDS
FOR THE YEAR ENDED SEPTEMBER 30, 2003
Federal Grantor/Pass-Through
Contract Number /
Grantor/Program Title
Vendor Number
Expenditures
Office of the Governor, Criminal Justice Division:
JB -Juvenile Accountability Incentive Block Grant
JB -01-J20-15525-03 $
3,280
JB -Juvenile Accountability Incentive Block Grant
JB -15525-04
366
Total Office of the Governor, Criminal Justice Division
3,646
Texas Comptroller of Public Accounts:
LEOSE fire Training Grant
17560049128-004
783
TCLEOSE Police Training Grant
17560049128-005
6,711
Tobacco Compliance Grant
17560049128-005
3,000
Total Texas Comptroller of Public Accounts
10,494
Texas Department of Transportation:
STEP WAVE Project Grant
582XXF6038
23,034
Total Texas Department of Transportation
23,034
Bureau of Justice Assistance:
Bulletproof Vest Grant Program
G02006
2,600
Total Bureau of Justice Assistance
2,600
Office of the Governor. Criminal Justice Division:
Mobile Crime Scene Unit Grant
SF -03-A10-16329-01
38,384
Total Office of the Governor, Criminal Justice Division
38,384
Texas State Library and Archives Commission:
Lone Star Libraries Grant Program
TX0416
10,428
Total Texas State Library and Archives Commission
10,428
Bureau of Justice Assistance
Local Law Enforcement Block Grants Program
2001 -LB -BX -4131
11,029
Total Texas
11,029
Texas Parks and Wildlife Department:
Allen Sports Complex
50-00263
500,000
Total Texas Parks and Wildlife Department:
500,000
Total Expenditures of State Awards
$
599,615
See accompanying independent auditors report
and accompanying notes to schedule of expenditures of state awards.
7
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I , CITY OF ALLEN, TEXAS
NOTES TO SCHEDULE OF EXPENDITURES OF STATE AWARDS
SEPTEMBER 30,2003
I' Note 1. General
' The accompanying Schedule of Expenditures of State Awards presents the activity of all federal and
state awards programs of the City of Allen, Texas. The City's accounting policies and procedures are
defined in the Note 1 to the basic financial statements. All awards received directly from state
' agencies as well as awards passed through other government agencies have been included in the
accompanying schedule.
' Note 2. Basis of Presentation
The accompanying Schedule of Expenditures of State Awards is presented using the accrual basis of
' accounting. Under this method, revenues are recorded when earned and expenses are recorded at
the time liabilities are incurred. The modified accrual basis of accounting is described in Note 1 to the
basic financial statements.
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