Comprehensive Annual Financial ReportCentral Fire Station (� n
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CITY OF ALLEN, TEXAS
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
CITY OF ALLEN
FISCAL YEAR ENDED
SEPTEMBER 30, 2007
AS PREPARED BY THE
FINANCE DEPARTMENT
CITY OF ALLEN, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2007
TABLE OF CONTENTS
11. FINANCIAL SECTION
Independent Auditor's Report 1
A. MANAGEMENT'S DISCUSSION AND ANALYSIS 3
B. BASIC FINANCIAL STATEMENTS
Government -Wide Financial Statements
EXHIBIT Page
1. INTRODUCTORY SECTION
Statement of Net Assets
Letter of Transmittal
I
Certificate of Achievement
vi
Organizational Chart
vii
Elected Officials and Administrative Officers
viii
11. FINANCIAL SECTION
Independent Auditor's Report 1
A. MANAGEMENT'S DISCUSSION AND ANALYSIS 3
B. BASIC FINANCIAL STATEMENTS
Government -Wide Financial Statements
Statement of Net Assets
1
19
Statement of Activities
2
20
Fund Financial Statements
Governmental Funds Financial Statements
Balance Sheet— Governmental Funds
3
22
Reconciliation of the Balance Sheet of Government
Funds to the Statement of Net Assets
4
24
Statement of Revenues, Expenditures and
Changes in Fund Balances—Governmental Funds
5
25
Reconciliation of the Statement of Revenues,
Expenditures and Changes in Fund Balances
of Governmental Funds to the Statement
of Activifies
6
27
Proprietary Funds Financial Statements
Statement of Net Assets — Proprietary Funds
7
28
Reconciliation of the Fund Level Statement of Net Assets
of Proprietary Funds to the GovemmenFwide
Statement of Net Assets
8
29
Statement of Revenues, Expenses and Changes
In Net Assets — Proprietary Funds
9
30
Reconciliation of the Statement of Revenues,
Expenses and Changes in Net Assets of
Proprietary Funds to the Statement of Activities
10
31
Statement of Cash Flows — Proprietary Funds
11
32
Component Units Financial Statements
Statement of Net Assets — Component Units
12
33
Statement of Activities — Component Units
13
34
CITY OF ALLEN, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2007
TABLE OF CONTENTS
C. REQUIRED SUPPLEMENTARY INFORMATION
General Fund Schedule of Revenues, Expenditures
And Changes in Fund Balances— Budget and Actual A-1 66
Notes to Required Supplementary Information 67
D. COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES
EXHIBIT
Page
Notes To Financial Statements
Note 1.
Summary of Significant Accounting Policies
35
Note 2.
Deposits, Investments and Investment Policies
43
Note 3.
Receivables
46
Note 4.
Capital Assets
47
Note 5.
Long -Term Debt
51
Note 6.
Interfund Transfers
59
Note 7.
Retirement Plan
60
Note 8.
Water and Sewer Contracts
62
Note 9.
Deferred Compensation Plan
63
Note 10.
Risk Management
63
Note 11.
Commitments and Contingent Liabilities
64
C. REQUIRED SUPPLEMENTARY INFORMATION
General Fund Schedule of Revenues, Expenditures
And Changes in Fund Balances— Budget and Actual A-1 66
Notes to Required Supplementary Information 67
D. COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES
Major Governmental Funds
Comparative Balance Sheets - General Fund
B-1
69
Comparative Statements of Revenues, Expenditures and
Changes in Fund Balances — General Fund
B-2
70
Comparative Balance Sheets— Debt Service Fund
B-3
71
Comparative Statements of Revenues, Expenditures and
Changes in Fund Balances — Debt Service Fund
B-4
72
Budgetary Comparison Schedule — Debt Service Fund
B-5
73
Comparative Balance Sheets— Facilities Agreement Fund
88
74
Comparative Statements of Revenues, Expenditures and
Changes in Fund Balances - Facilities Agreement Fund
B-7
75
Comparative Balance Sheets — General Capital Projects Fund
B-8
76
Comparative Statements of Revenues, Expenditures and
Changes in Fund Balances—General Capital Projects Fund
B-9
77
CITY OF ALLEN, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2007
TABLE OF CONTENTS
EXHIBIT
Page
Comparative Balance Sheets—General Obligation Bond Fund
B-10
78
Comparative Statements of Revenues, Expenditures and
Changes in Fund Balance—General Obligation Bond Fund
B-11
79
Non -major Governmental Funds
Combining Balance Sheet
C-1
81
Combining Statement of Revenues, Expenditures and
Changes in Fund Balances
C-2
84
Major Enterprise Funds
Comparative Statements of Net Assets— Water and Sewer
D-1
85
Comparative Statements of Revenues, Expenses and
Changes in Fund Net Assets— Water and Sewer
D-2
86
Comparative Statements of Cash Flows — Water and Sewer
D-3
87
Comparative Statements of Net Assets — Solid Waste
D4
88
Comparative Statements of Revenues, Expenses and
Changes in Fund Net Assets—Solid Waste
D-5
89
Comparative Statements of Cash Flows— Solid Waste
D-6
90
Comparative Statements of Net Assets— Drainage
0-7
91
Comparative Statements of Revenues, Expenses and
Changes in Fund Net Assets — Drainage
D-8
92
Comparative Statements of Cash Flows — Drainage
D-9
93
Statements of Net Assets — Golf Course
D-10
94
Statements of Revenues, Expenses and
Changes in Fund Net Assets — Golf Course Fund
0-11
95
Statements of Cash Flows — Golf Course Fund
D-12
96
Internal Service Funds
Combining Statement of Net Assets
E-1
98
Combining Statement of Revenues, Expenses and
Changes in Fund Net Assets
E-2
99
Combining Statement of Cash Flows
E-3
100
CITY OF ALLEN, TEXAS
F5
106
COMPREHENSIVE ANNUAL FINANCIAL REPORT
G-2
111
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2007
F-6
107
TABLE OF CONTENTS
TABLE
Page
EXHIBIT
F-7
Page
Discretely Presented Component Units
1
115
Comparative Balance Sheets -Economic Development Corporation
F-1
102
Reconciliation of the Governmental Funds Balance Sheet to the
3
118
Statement of Net Assets
F-2
103
Comparative Statements of Revenues, Expenditures and Changes
5
120
in Fund Balances
F-3
104
Reconciliation of the Governmental Funds Statement of
7
122
Revenues, Expenditures and Changes in Fund Balance
FA
105
Comparative Balance Sheets -Allen Community Development
Corporation
F5
106
Reconciliation of the Governmental Funds Balance Sheet to the
G-2
111
Statement of Net Assets
F-6
107
Comparative Statements of Revenues Expenditures and
TABLE
Page
Changes in Fund Balances
F-7
108
Reconciliation of the Governmental Funds Statement of
1
115
Revenues, Expenditures and Changes in Fund Balance
F-8
109
E. CAPITAL ASSETS USED IN THE OPERATION OF GOVERNMENTAL FUNDS
Comparative Schedules by Source
G-1
110
Schedule by Function and Activity
G-2
111
Schedule of Changes by Function and Activity
G-3
113
TABLE
Page
STATISTICAL SECTION
Net Assets by Components
1
115
Changes in Net Assets, Last Three Fiscal Years
2
116
Fund Balances, Governmental Funds
3
118
Changes in Fund Balances, Govemmental Funds
4
119
Assessed Value and Estimated Actual Value of Taxable Property
5
120
Direct and Overlapping Property Tax Rates
6
121
Principal Property Tax Payers
7
122
Ad Valorem Tax Levies and Collections
8
123
Ratio of Outstanding Debt by Type
9
124
Ratio of General Bonded Debt Outstanding
10
125
Direct and Overlapping Governmental Activities Debt
11
126
Pledged -Revenue Coverage
12
127
Demographic and Economic Statistics
13
128
Principal Employers
14
129
Full -Time Equivalent City Government Employees by
Function/Program
15
130
Operating Indicators by Function/Program
16
131
Capital Asset Statistics by Functlon/Program
17
132
CITY OF ALLEN
March 25, 2008
Honorable Mayor and City Council,
City Manager,
Citizens of Allen:
The Comprehensive Annual Financial Report (CAFR) of the City of Allen, Texas (the City), for the
fiscal year ended September 30, 2007, is submitted herewith.
Management assumes full responsibility for the completeness and reliability of information
contained in this report, based upon a comprehensive framework of internal control that is
established for this purpose. Because the cost of Internal control should not exceed anticipated
benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial
statements are free of any material misstatements.
Weaver and Tidwell, L.L.P. have Issued an unqualified ("dean") opinion on the City of Allen's
financial statements for the year ended September 30, 2007. The independent auditors report is
located in the beginning of the financial section of the CAFR.
This letter of transmittal is designed to complement Management's Discussion and Analysis
(MDBA) and should be read in conjunction With it. The City's MDBA can be found immediately
following the independent auditors report and provides a narrative introduction, overview and
analysis of the basic financial statements.
PROFILE OF THE GOVERNMENT
The City of Allen, incorporated in 1953, is located in central Collin County, Texas, 25 miles north
of downtown Dallas, on U.S. Highway 75 and currently occupies a land area of 26.31 square
miles. The City's population was 78,804 at the and of the fiscal year and has grown to over
81,168 In January 2008.
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,
sanitabonlsolid waste service, water and sewer services, construction and maintenance of
streets, recreational activities and cultural events.
The financial reporting entity (the government) includes all funds of the primary government (i.e.,
the City of Allen as legally defined), as well as all of its component units. Component units are
legally separate entitles for which the primary government is financially accountable. Discretely
presented component units are legally separate entities and not part of the primary government's
operations. The Allen Economic Development Corporation (AEDC) and Allen Community
Development Corporation (ACDC) are included in the financial statements as discretely
presented component units.
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. The operefing budget includes proposed expenditures and the
means of financing them. Public hearings are conducted to obtain taxpayers' comments. Prior to
305 CENTURY PARKWAY • ALLEN, TEXAS 75013-8042. 214.509A 100
WEB: www c r,ofallen ore"EMAIL: coa@cilyofallen.or8
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.
As part of each years budget development process, departments are required to update revenue
and expenditure estimates for the current fiscal year. The re-estimated current year budget is
submitted to the City Council along with the proposed budget for the next fiscal year. The revised
budget Is than used as a working budget for the last half of the current fiscal year.
During the course of the year on-line reporting has been developed using an automated
management accounting system to allow individual departments to review and compare actual
versus budgeted amounts. The Finance department also reviews operating revenues and
expenditures, recommending adjustments as needed. On a quarterly basis, the Finance
department submits financial reports to 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.
LOCAL ECONOMY
Bordered by McKinney to the north and Plano to the south, Allen is directly in the path of growth.
The population of approximately 78,804 is anticipated to reach 97,900 by the year 2011. The
quality of the Allen community attracts well-educated residents with a high level of spending
power and disposable income making Allen a prime location for restaurants, shopping centers
and other retail venues.
Allen is a community that offers exceptional housing, award-winning schools and a pro-business
attitude and enthusiastic accommodation of industry. In addition to maintaining Allen's quality of
life, the Planning and Development department along with the Allen Economic Development
Corporation (AEDC) actively work to balance new residential growth with quality ocormercial
developments. A major development currently underway is a new multi-purpose event center with
6,200 fixed seats and 26 luxury suites; a project that has been a part of the City's strategic vision
for many years. The Allen Event Center will host a Central Hockey League team with two sheets
of Ice along with 100 entertainment events annually. The Event Center will be located in the
Village of Allen commercial development at U.S. 75 and Stacy Road. This 181 acre development
will feature the event center, two parking garages, 1.5 million square feet of retail, restaurants,
office and hotel space. Also, this spring, Phase One of Waters Creek at Montgomery Farms will
open at Bethany and U.S. 75 with first-in-class retail, 250,000 square feet of office and 250 luxury
residential units above the retail to define Allen's first 'live, shop and play" development.
The vision of the City is to create the highest quality of life in Allen. These developments achieve
that goal as well as create regional attractions that bring people from surrounding communities
and additional tax dollars to Allen. The following categones represent key factors that impact
Allen's economic and financial success:
Property Values - Assessed property values increased $558 million (10.8%) from the preceding
year with $293 million in new property and a $265 million increase in the value of existing
property. During the last five years assessed property value has increased 58% and property
taxes account for 50.09% of the General Fund revenue. With a well-educated populace and
average household income of $108,680, Allen enjoys an exceptionally high property tax collection
rale. Increases in assessed property value along with continued economic growth have allowed
the City Council to lower the property tax rate for the fourteenth consecutive year while Improving
quality services to its cifizens.
Retall Sales — The General Fund's second largest revenue source is sales tax generated from a
variety of businesses operating in the City of Allen. Sales tax receipts resulted in revenue of
$9.76 million in fiscal year 2006-07, a 5.69% increase over the prior year. With recent new
development such as Montgomery Fan, the Villages at Allen and the large number of retailers
and restaurants settling in Allen, future revenues are expected to grow as Allen becomes a
destination for shopping and entertainment.
Long-Term Financial Planning — The City's annual budget process involves 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.
• Improve regional mobility through transportation Initiatives.
• Signify, enhance and communicate Allen's Identity to the region and the nation.
• Systematically invest in public infrastructure.
• Maintain operational excellence in City government services.
• Provide public support for new economic investment in Allen that broadens the
employment base, provides desired goods and services for residents and contributes to
the community character and Identity.
Individual departments develop their goals and objectives In terms of these all-encompassing
organizational goals.
Strategic Financial Plan — An appropriate financial plan for the City of Allen requires many
elements all working in concert with one another. Current expectations are for continued sales
tax revenue growth 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-term 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
special financial planning to achieve success.
Capital Improvement Program Planning — The City of Allen's Capital Improvement Program 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 seven-year plan that 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 repriodtized 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.
In May 2007, Allen voters approved a $77,895,000 bond election proposed by the 2007-2013
Capital Improvement Program steering committee and approved by the City Council. Voters
approved $14,500,000 for maintenance and operations service center facilities, $1,700,000 for
renovating existing municipal public buildings, $27,200,000 for street improvements, $17,250,000
for park and recreation facilities, $1,390,000 for public art projects and $15,855,000 for public
safety facilities.
Debt Management — All debt 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 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 payors -you -go revenues 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, state investment pools, commercial
paper, 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.
Insurance and Risk Management - The City has a comprehensive risk management program,
including property, liability, safety, workers' compensation, health, dental and wellness. The
safety incentive program 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. Administration of these functions requires participation from the Risk Manager, outside
legal counsel and consultants. To reduce health claim costs, the City promotes a wellness
program to Improve employee awareness of exercise, nutrition, and lifestyle choices.
Procurement Planning- Under the Finance Department, the 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.00m 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. Also, the City's Business Diversity Program encourages the participation of small,
minority and women -owned businesses in the City of Allen procurement process.
FISCAL YEAR 2007 HIGHLIGHTS
The City of Allen's fiscal year 2006-2007 reflects the efforts of the governing body and City staff
to address the need to provide services and facilities to support our vibrant and growing
community while maintaining a strong financial position. A five-year Information Technology
Strategic Plan was implemented to begin enhancing the City's technology infrastructure,
operational efficiency and responsiveness to citizens. Staffing levels were increased by 15.4 full
time equivalent positions, with 7 of the positions created in the Police Department. All of these
positions emphasize the City's commitment to maintain a high level of service to our Citizens
while conservatively growing the size of the organization.
Record rainfall in the North Texas area through spring and summer decreased water sales
revenue by 27.6% from the previous year when extreme drought conditions existed. Community
efforts between the City, school district, homeowner's associations, civic groups and individuals
are on-going to promote water conservation education. A new water and sewer rate structure
was implemented and key pieces of equipment were purchased to make the delivery of services
faster, more efficient and improved our abilities to detect leaks in the water system and inflows
into the sewer system.
During the fiscal year the combined efforts of City Manager, Peter Vargas, the Allen Economic
Development Corporation, the Community Development Corporation, City Council members and
City staff worked diligently to finalize the agreements for the Village of Allen and to obtain the
Allen Events Center. This project that has been a part of the City's strategic vision for many
years and establishes Allen as a destination center for retail and entertainment.
AWARDS AND ACKNOWLEDGEMENTS
Awards — The Government Finance Officers Association of the United States and Canada
(GFOA) awarded a Certificate of Achievement for Excellence In Financial Reporting to the City of
Allen for its CAFR for the fiscal year ended September 30, 2006. This was the ninth 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 believe that our current
CAFR continues to meal the Certificate of Achievement Program's requirements, and we are
submitting it to the GFOA to determine its eligibility for another certificate.
Acknowledgements — Many people are responsible for the preparation of this report, and for the
maintenance of records upon which it is based. Appreciation is expressed to representatives of
Weaver and Tidwell L.L.P. for their invaluable assistance In producing the final document and to
Dana Murray, Accounting Manager, and Tru Nguyen, Senior Accountant, who were instrumental
in the completion of this report.
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.
RespecHUlly subm' ed,
Kevin Hammeke
Finance Director
Joanne
Assistant Finance Director
Certificate of
Achievement
for Excellence
in Financial
Reporting
F3eatmted to
City of Allen
Texas
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
September 30, 2006
A Certificate ofAcbiewment for Excellence in Fineedal
Reporting is presented by the Oovamment Finance Ofi'icerx
Association of the United States and Canada to
goverameot wits and public employ" n6rcIDeat
systems whose wanprehaoaive annual financial
repaint (CAFRs) achieve the highest
standards in govarwent accounting
and financial reporting.
CITY OF ALLEN
ORGANIZATIONAL CHART
A
CITY OF ALLEN, TEXAS
CITY OFFICIALS
Council Members
Mayor
Stephen Terrell
Mayor Pro Tem
Debbie Stout
Place 2 Council Member
Ross Obermeyer
Place 3 Council Member
Mark Pacheco
Place 4 Council Member
Robin L. Sedlacek
Place 5 Council Member
Gary L. Caplinger
Place 6 Council Member
Jeff McGregor
Management Staff
City Manager Peter H. Vargas
Finance Director Kevin Hammeke
Assistant Finance Director Joanne Stoehr
Accounting Manager Dana Murray
WEAVER
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INDEPENDENT AUDITOR'S REPORT
Honorable Mayor and Members of
the City Council
CITY OF ALLEN, TEXAS
We have audited the accompanying financial statements of the governmental activities,
the business -type activities, the aggregate discretely presented component units, 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, 2007, 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,
the aggregate discretely presented component units, each major fund, and the aggregate
remaining fund information of the City of Allen at September 30, 2006 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.
In accordance with Govemment Auditing Standards, we have also issued our report
dated March 14, 2008, on our consideration of the City's internal control over financial
reporting and our tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements and other matters. The purpose of that report is to
describe the scope of our testing of internal control over financial reporting and
compliance and the results of the testing, and not to provide an opinion on the internal
control over financial reporting or on compliance. That report is an integral part of an
audit performed in accordance with Government Auditing Standards and should be
considered in assessing the results of our audit.
The accompanying management's discussion and analysis and budgetary comparison
information on pages 3 through 18 and 66 and 67, respectively, are not a required part of
the basic financial statements but are supplementary information required by the GASB.
III,,,, We have applied certain limited procedures, which consisted principally of inquiries of
uul arc.;, nn, management regarding the methods of measurement and presentation of the required
^'°0•'11.1 supplementary information. However, we did not audit the information and express no
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City of Allen, Texas
Page Two
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 schedules, the discretely presented component units
financial statements and schedules, schedules of capital assets used in the operation of
governmental funds, 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
and schedules, discretely presented component units financial statements and schedules,
and schedules of capital assets used in the operation of governmental funds 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
March 14, 2008
MANAGEMENT'S DISCUSSION
AND ANALYSIS
i 41f5`fCT h ;"",V/
CITY OF AIV
CITY OF ALLEN, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
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, 2007.
FINANCIAL HIGHLIGHTS
• The assets of the City exceeded its liabilities (net assets) at September 30, 2007
by $473,922,725. Of this amount, $55,508,599 (unrestricted net assets) may be
used to meet the government's ongoing obligations to citizens and creditors.
• The City's total net assets increased by $24,023,298. The increase is primarily a
msult of an increase in developer contributions due to growth in residential and
commercial development and an Increase in the assessed property values.
• The City's governmental funds reported combined ending fund balances of
$43,346,852 at September 30, 2007; an increase of $12,688,827 from the prior
fiscal year.
• At the end of the fiscal year, the unreserved fund balance for the General Fund
was $13,373,243 or 31% of total General Fund expenditures.
• On a govemmenl-wide basis, the City's total liabilities increased by $2,381,640.
The key factors for this increase is a result of the issuance of $11,145,000 in
General Obligation Bonds.
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 am 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.
Government -wide financial statements - The government -wide financial statements am
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 changes in net assets are reported when the undertying event giving
rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and
expenses am 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.
CITY OF ALLEN, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
In the government -wide financial statements, pages 19 through 21, 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, sewer, solid waste, drainage, and golf
course operations are reported here. These are functions intended to recover all
or a significant portion of their costs through user fees and charges.
• Component units - The City includes two separate legal entities in this report: the
Allen Economic Development Corporation (AEDC) and the Allen Community
Development Corporation (ACDC). 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 - Thew 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-term 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, Debt Service Fund, Facilities
Agreement Fund, General Capital Projects Fund and General Obligation Bond 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 22 through 27 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
CITY OF ALLEN, TEXAS
MANAGEMENTS DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
uses enterprise funds to account for its water and sewer operations, solid waste collection,
disposal services, drainage operations, and golf course operations. 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 vehicle, machinery, and
equipment replacements and costs associated with workers compensation, liability and property
insurance, and employee medical and dental insurance programs. 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
since they are considered to be major funds of the City. The Drainage Fund and the Golf
Course Fund are the only remaining enterprise funds, so they are being presented as major
funds even though they do 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 28 through 32 of this
report.
Notes to the Financial Statements - Additional information that is essential to a full
understanding of the data provided In the government -wide and fund financial statements is
provided in the notes to the financial statements found on pages 35 through 65 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 66 through 67 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.
Comparative schedules of capital assets used in the operation of governmental funds are found
on pages 110 through 113.
CITY OF ALLEN, TEXAS
MANAGEMENTS DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
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 $473,922,725 as of
September 30, 2007. By far the largest portion of the City's net assets ($416,975,549 or 88%)
reflects its investment in capital assets (i.e. land, buildings, infrastructure, vehicles, machinery,
and equipment), less any related debt used to acquire those assets that are still outstanding.
The City uses these capital assets to provide services to citizens; consequently, these assets
are not available for future spending. Although the City's investment in its capital assets is
reported 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.
T.W.1
NO Ms
Long- —9a ftl 91,989188 5,841}5 19,M,M 18,474,885 109.923,588 105315.%1
O rlmb9 a 555,3% 9,4388% 3.953,250 4.190.894 12.503,58 13.81.2%
Total Wbfl es 1%5X,18] 99.Z/]58 28]929)0 22.58.592 121,2718 118_47,254
Ne Asxls'
Inw51eE m capital
as4eN. M of,eNtetl
808 333,90,275 319,1),5 83,45,2>4 78,48,220 418,9]5.548 %8.30855
aee0Ac0e0 1,o%.998 1,1883% 335842 945858 11438540 2,101,%0
umeW%b9 3.3.492994 27%195 22107,42 21.4%.894 55.50,35 49.497,57
TotaINRA1aN. $ 38.993,28] 348.981.55] 8 1%.88.45 100.931.770 S 4]3,82]25 44888849
An additional portion of the City's net assets, $1,436,840, represents resources that are subject
to external restrictions on how they may be used; the remaining balance of $55,510,336 may be
used to meet the government's ongoing obligations to citizens and creditors.
Analysis of the City's Operations - As of September 30, 2007, the City had an overall
increase in net assets of $24,023,298 for the government as a whole which, represents
$19,028,610 for governmental activities and $4,994,688 for business -type activities. The
increase is due to continuous population and housing growth which stimulates local business
and economic development. Assessed properly, values have also increased 58% over the past
five years. A summary of the City's operations for the year ended September 30, 2007 is
provided in Table 2.
Sow Mm
lAcdAes
BuaMaHwe
ACIN.Iea
Trial
M7
2
244L
L9%
Cu„em antl oMerasse4 i
591398,638
46.858.199 8
26,826.739
3,038,907 $
08,135,3]]
78,59505
Capra) assets
4%,318.919
3%,%81%
%.8559
88.887.555
509.114.505
491,M,575
To IAveta
489,52].451
445.24819
128.722.429
123.604.38
595.249.882
568.81&081
Long- —9a ftl 91,989188 5,841}5 19,M,M 18,474,885 109.923,588 105315.%1
O rlmb9 a 555,3% 9,4388% 3.953,250 4.190.894 12.503,58 13.81.2%
Total Wbfl es 1%5X,18] 99.Z/]58 28]929)0 22.58.592 121,2718 118_47,254
Ne Asxls'
Inw51eE m capital
as4eN. M of,eNtetl
808 333,90,275 319,1),5 83,45,2>4 78,48,220 418,9]5.548 %8.30855
aee0Ac0e0 1,o%.998 1,1883% 335842 945858 11438540 2,101,%0
umeW%b9 3.3.492994 27%195 22107,42 21.4%.894 55.50,35 49.497,57
TotaINRA1aN. $ 38.993,28] 348.981.55] 8 1%.88.45 100.931.770 S 4]3,82]25 44888849
An additional portion of the City's net assets, $1,436,840, represents resources that are subject
to external restrictions on how they may be used; the remaining balance of $55,510,336 may be
used to meet the government's ongoing obligations to citizens and creditors.
Analysis of the City's Operations - As of September 30, 2007, the City had an overall
increase in net assets of $24,023,298 for the government as a whole which, represents
$19,028,610 for governmental activities and $4,994,688 for business -type activities. The
increase is due to continuous population and housing growth which stimulates local business
and economic development. Assessed properly, values have also increased 58% over the past
five years. A summary of the City's operations for the year ended September 30, 2007 is
provided in Table 2.
CITY OF ALLEN, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30.2007
(UNAUDITED)
Tablet
Changes In Net Assets
Eytenses'.
Govemmenbl Aoh,ft,a
B -tune
Actvbas
I>�1
2m
am
2xz
20%
21mL
2�9
Revenues
PuNkseflty
20.718,918
19,008.822
24714308
Program Revenues:
Pudic Mike
13,174859
13,058.0
14174889
Charges for services 6
8,613,1561
6,473421
26.397.811
29.664 948
32,851,381
38,137,389
Operatog grants and
Communny d9velopment
2.031,522
2,029.589
2.31,622
ootriboliona
2,767,412
2.888.438
2,767,112
2,884438
Capital grann and
Interest on long brm"In
4.10.82
4.238.814
4,010.882
co NSNima
18,8911
25.504.879
8,029.069
8,257.558
24,925,555
33,782,437
General Revenues:
EenNmnlnenblwnb
Property texas
32,922829
29,667,668
3.921,0803,523,01K
32.922829
24WT.88
Sales bx
6.754380
9,234206
704503
9,755,380
9,2W.2J8
Froochisetares
4,931,008
5,582.256
1303174
4.931,008
4582258
Hotel moW bass
873.383
411,488
8111.47102
24983120
673,383
411.489
Other bass
1,883,830
1,831,725
1.893,830
1,831,125
Inbresteamnpe
3,011,10
2,4011571
1884510
96430)
4,230,655
3.397,078
Gann m sale of mpibl
Transfers
2714588
1.111
(2718588)
11,693798)
t
",830
327,268
30,6301893
4,930,888
1I,93a
M72M
Miscelle.
mi.m
794088
32/07968/
100831770
891816
730.88
Total Revenue9
82384221
84872007
3361111l
311,916,013
115870,617
123/90020
Eytenses'.
Generalpcoemmard
11,171.912
0,282795
11,171,912
9282.795
PuNkseflty
20.718,918
19,008.822
24714308
19,008822
Pudic Mike
13,174859
13,058.0
14174889
13,054440
Culture am recreation
14,912287
14.54082
14,912,287
14,OW.302
Communny d9velopment
2.031,522
2,029.589
2.31,622
2.29588
Grenb AOnBnisha8on
Interest on long brm"In
4.10.82
4.238.814
4,010.882
4,234814
Waterton.
19,483,383
17,1151,504
19,149,393
17,951,501
EenNmnlnenblwnb
rvima
3.921,0803,523,01K
3,621.80
3,829084
Drauu2e
704503
307755
704803
817,755
Golf mores
1303174
1991430
1 309174
1991430
Talal Expenses
30054169
8111.47102
24983120
24.18833
911117,319
85W3935
Increase In net aseab before
trend.
18,310,022
23.224.30
7,713,278
14.301,130
24,029288
34124085
Transfers
2714588
1.111
(2718588)
11,693798)
Increaseinnetasaeb
19.028,810
30,6301893
4,930,888
13,237.392
24.023899
34124085
Nmaaema, beg'rnnin9a1year
348,930307
32/07968/
100831770
"411
449898427
4111143/2
Net assets, end of year S
36>093887
318981.457
t30,92B,458
100,9.,770
479.B22.Tlb
N9,899.427
1
CITY OF ALLEN, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
Governmental activities
Revenues — The following chart visually illustrates the City's revenue by sources for
governmental activities.
sal« toss
f8,758,9$4
11%
Revenues for the City's governmental activities decreased by $2,507,786 or 3%. While some
activities ended the fiscal year with an increase, capital grants and contributions significantly
decreased by $6,608,393. Major components of revenue decreases/increases are explained as
follows:
• Capital grants and contributions decreased from the prior year as a result of new
commercial and residential growth slowing and street construction being completed.
• While the City was able to lower the property tax rate from $0.559 to $.0558 per $100
valuation, the property tax base and assessed property value increased on the average
single family home by 6.4%.
• Investment earnings increased due to the increase in the interest rates on investments.
• Sales taxes increased due to additional retail businesses, more residents, and the rise in
the economy.
is In FY06, the City received an additional payment from TXU Electric due to the privilege
period changing from annual to quarterly. As a result, the franchise taxes decreased in
FY07 when compared to the previous year.
• Hotel taxes increased as a result of the first full year of operation of Holiday Inn and
Hampton Inn.
Revenue by Source -Governmental Activities
Oboists, Grants 6
contributions
,2,767,412
_
\ Cashil Grants end
Chansons for
3%
Contributions
arvk«
Transfers
$16,996,466
_
SG.W,664
$2,718,688 -
22%
8%
3%
Oster J'
$6,586,112
broaartY lases
8%
$32,622,226
Frenchls Tas•s
39%
$4.,81,688
6%
sal« toss
f8,758,9$4
11%
Revenues for the City's governmental activities decreased by $2,507,786 or 3%. While some
activities ended the fiscal year with an increase, capital grants and contributions significantly
decreased by $6,608,393. Major components of revenue decreases/increases are explained as
follows:
• Capital grants and contributions decreased from the prior year as a result of new
commercial and residential growth slowing and street construction being completed.
• While the City was able to lower the property tax rate from $0.559 to $.0558 per $100
valuation, the property tax base and assessed property value increased on the average
single family home by 6.4%.
• Investment earnings increased due to the increase in the interest rates on investments.
• Sales taxes increased due to additional retail businesses, more residents, and the rise in
the economy.
is In FY06, the City received an additional payment from TXU Electric due to the privilege
period changing from annual to quarterly. As a result, the franchise taxes decreased in
FY07 when compared to the previous year.
• Hotel taxes increased as a result of the first full year of operation of Holiday Inn and
Hampton Inn.
CITY OF ALLEN, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
Expenditures for governmental activities increased by $4,407,097 or 7.1%. Increases were due
to increased personnel and maintenance costs for new facilities, and an increase in service
demands caused by population growth. Major components of increases are explained as
follows:
• Staffing levels increased by 14.90 full time equivalent positions needed as a direct
result of operation and maintenance needs of new facilities and a growing
population. Merit increases averaged 4% and Public Safety certification pay was
implemented.
• The first year of the five-year IT Master Plan resulted in the hiring of a network
systems supervisor, construction of a new server room, purchasing network
managing software and installing a new data storage system.
• As a result of the addition of new staff, as well as increased medical claims, the
cost the City contributes for health insurance premiums increased by 20.9%.
• Street construction consisted of the widening of Exchange Parkway from Watters to
West Branch and SH5 from Exchange to Stacy. In addition, St. Mary's Drive phase
3 street improvements were completed.
• Culture and recreation increased due to increased costs to maintain public facilities
and parklands.
• The General Fund and Park and Recreation Fund transferred a total of $570,652 to
the Golf Course Fund due to revenue shortfalls and to cover operating expenses.
The following chart illustrates the relationship between expenses and program revenues for
governmental type activities.
Expenses and Program Revenues -Governmental AcMNkbs
1.1
General PubIICSffiely Cultur—M Community PuN,CWorkc Flereston
Government Recreatbn Geaelopmant Longterm
DW
CITY OF ALLEN, TEXAS
MANAGEMENTS DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
Business -type activities —
Revenues — The following chart visually illustrates the City's revenue by sources for business -
type activities.
Revenue By Source - Business -Type Activities
Charyea for
xM as
.]97.617
76%
Capital Grants 8
Contributions
66,0]9,069
16%
J
Other Revenue
61,]69.510
9%
Business -type activities revenues decreased by $5,311,617 or 13.6%. Major components of the
decreaseslncreases are as follows:
• Charges for services for business -type activities decreased by $3,357,131 or 11.3%.
The largest part of this decrease is a result of the weather related conditions that
occurred which resulted in less water used by citizens and business for landscaping
maintenance. Water sales decreased by 27.6% from the previous year.
• Capital contributions for water and sewer lines and impact fees decreased by 27% due
to residential growth slowing.
at Due to weather related conditions, the Golf Course Fund required transfers from the
General Fund and the Park and Recreation Fund totaling $570,652 for operating costs.
• Interest earnings grew from $995,507 in FY2006 to $1,269,510 in FY2007. This
increase was a result of the continued increase of rates on investments during FY07.
Expenses for business -type activities increased by $1,876,287 or 7.8%. The increases were
primarily a result of expansion of waterlines, the expansion of Custer Road pump station #3,
and sewer replacement on Jupiter Road. The following chart illustrates the relationship
between expenses and program revenues for business -type activities:
10
CITY OF ALLEN, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
Expenses and Program Revenues - Business -type Activities
is Digense is Revenue
vo 000 oaD
ft5000p0o
Vo o00 000
sa00o 0oa
sn o00 000
M itre.o.
Water B Seeer Sora Waste Drainage Gol(Dourse
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-term
inflows, outflows and balances of spendable resources. Such information is useful in assessing
the City's measure of a government's net resources available for spending at the end of the
fiscal year.
At the end of the current fiscal year, the governmental funds reported combined ending fund
balances of $43,346,852, an increase of $12,688,827 in comparison with the prior fiscal year.
Approximately 92% or $39,820,566 constitutes unreserved fund balances, which are available
for spending at the government's discretion. The remaining fund balances are reserved to
indicate that they are not available for new spending because the funds have already been
committed to pay for encumbrances ($2,126,301), and debt service ($1,399,985).
The General Fund is the chief operating fund of the City. At the end of the current fiscal year,
the total unreserved fund balance was $13,373,243. The total fund balance increased by
$812,214 more than the final revised budget. Contributing to this variance was revenue greater
than the revised budget by $239,586 due to higher than anticipated revenue from all sources
except property taxes and court fines. Current operating expenditures had savings of
$2,213,019 allowing an additional $210,894 to be transferred to the Golf Course Fund and
$1,289,000 transferred to the Capital Projects Fund for self financing of capital projects. The
fund balance increased from $11,492,233 to $13,373,243 resulting in a positive effect on the
operational expenditure reserve for the 2006-2007 budget.
The Debt Service Fund balance of $1,399,985, all of which is reserved for the payment of debt,
increased from the prior year fund balance by $106,274. Since fiscal year 2005-06, the
allocation to the debt service portion of ad valorem tax rate has decreased to $0.167 or 8.6%
from $0.183 or 36%. The remaining fund balance meets the FY2007 10% of annual debt service
requirement of $1,015,333.
CITY OF ALLEN, TEXAS
MANAGEMENTS DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
The Facilities Agreement Fund records the use of funds received from builders and developers
on specific facility agreements. At fiscal year end revenues exceeded expenditures by
$343,099 resulting in the fund balance increasing from $2,826,417 to $3,169,516. The net
increase was mainly a result of interest earnings. The major expenditure for the fund was
widening of Exchange from Watters to West Branch.
The General Capital Projects Fund provides information on cash financed capital projects.
During the fiscal year, the fund balance increased by $1,456,655 from $6,373,660 to
$7,830,305. Revenues and transfers from other funds totaled $5,335,581 which included
$1,125,000 from the County and $234,628 from the State of Texas for the widening of
Exchange Parkway and $2,068,362 transferred in from other funds to cash finance capital
projects. Total expenditures were $3,878,926 and consisted of street improvements at St.
Mary's Drive, widening of Exchange, emergency signals for fire station 2 and 3, and for the
construction of Shallowater Bridge.
The General Obligation Bond Fund had an ending fund balance of $13,234,722, an increase of
$10,053,704 from the prior year. Revenues and other financing sources included interest
earnings and $11,145,000 of new issued bonds. Expenditures totaled $1,347,251 which
included $1,040,815 to fund construction of the Arts of Collin County project.
Proprietary Funds
The City's proprietary funds provide the same type of information found in the government -wide
financial statements, but in more detail.
At the end of the year, unrestricted net assets for all enterprise funds are as follows: Water and
Sewer, $17,729,431, Solid Waste, $2,331,596, Drainage, $1,248,635, and Golf Course,
$91,591. The total change in net assets for the funds was $3,966,005, $683,196, $158,055,
and $107,565, respectively. All funds had an increase in net assets as a result of capital
contributions, transfers from other funds, and operating revenues. The Water and Sewer Fund
contributed $2,100,000 for the repainting of the Stacy Road ground storage tank, water and
sewer line replacement and concrete repairs. Other factors concerning the finances of these
funds have already been addressed in the discussion of the City's business -type activities.
General Fund Budgetary Highlights
During April and May, all accounts are evaluated to determine if they are in line with the original
budgets. Accounts that are under or over budget are revised to meet year -and estimates. New
projects are not added to the year-end estimate; only the cost of maintaining the current base
operation is revised as needed. As is customary, during FY2006-07, the City Council amended
the budget for the General Fund one time.
Small adjustments made during FY2006-07, increased the original revenue budget by
$1,075,297 and decreased the expenditure budget by $637,272. Al the end of FY2007
revenues exceeded the revised budget by $239,586. Additional retail businesses and more
residents caused positive revenue budget variances in sales tax and property. In FY06, the City
received an additional payment from TXU due to a change from annual to quarterly payments.
As a result of this additional payment in FY06, franchise taxes decreased in FY07. Positive
expenditure variances were due to salary savings from open staffing positions, reduced
watering and mowing costs of city parkland due to weather conditions, and prudent conservative
12
CITY OF ALLEN, TEXAS
MANAGEMENTS DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
management by city staff. The net result of positive revenues and expenditure budget variances
allowed the General Fund to transfer out an additional $1,499,894 representing an additional
$210,894 to the Golf Course Fund for operating costs being more than expected and
$1,289,000 to the General Capital Projects Fund to cash finance capital projects.
The resulting General Fund balance increased $1,881,010 which was $812,214 more than
budgeted and increased the funds operational expenditure reserve from the budgeted 71.6 days
to 108.9 days, well above the City's financial policy of 60 days.
CAPITAL ASSETS
The City's invested in capital assets for its governmental and business -type activities as of
September 30, 2007, amounts to $509,114,506 (net of accumulated depreciation.) This
investment in capital assets includes land and improvements, buildings, vehicles, machinery
and equipment, park land and facilities, roads and bridges. About 80% of the capital assets are
governmental and 20% are business -type activities. The total increase in investment in capital
assets for the current fiscal year was 3%, out of which 63% was governmental and 37% was
business -type activities.
Table 3
Capital Assets at Year-end Net of Accumulated Depreciation
13
Governmental Activities
Businesstype
Activities
Total
2007
2006
2007
2006
2441
2006
Land $
103,304,007
0,611,W $
3,380,635
3,327,730 $
106,681,642
101,938,774
Buildmgs
44,693,164
38,684,509
44,693,164
38,684,509
Towerst lanlod pump stations
84,221,962
81,830,490
84,221,962
81,830,490
Other Improvements
245,24,734
227,719,989
441,911
453,852
245,686,645
228,173,841
Furniture and figures
792,169
1,139411
11,035
3,454
803,204
1,142,865
Vehicles
3,269,854
3,295,841
44,128
37,765
3,313,982
3,333,606
Machinery and equipment
1,079,668
1,344,146
1,626,246
1,636,066
2,705,914
2,980,212
construction in progress
10.835,221
27591,180
10.169,772
6.278,198
21.004.993
33,869,378
Total s
409,218,817
398,386,120 $
99,895,689
93,567,555 $
509,114,506
491,953,675
13
CITY OF ALLEN, TEXAS
MANAGEMENTS DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
Governmental -type capital improvement projects and developer contributions during the current
fiscal year included the following:
Proiects
• Developer contributed right of way and park land
$ 15,956,369
• Spring Meadows Park
498,277
• Allenwood Park Development
381,524
• Street construction:
Exchange, Watters -W. Branch
2,088,441
St. Mary Drive, phase 3
1,208,810
_ SH 5, Exchange -Stacy
712,303
Business -type capital improvement projects and developer contributions during the current
fiscal year include the following:
Projects
• Developer contributed water mains and sewer lines $ 4,139,592
• Custer Road pump station N3 expansion 1,642,682
• Twin Creeks 36' waterline 396,623
• Jupiter Road sewer replacement 293,594
Additional information on the City's capital assets can be found in Note 4 on pages 49-53
of this report
DEBT ADMINISTRATION
At September 30, 2007, the City had long-term debt totaling $108,823,598 shown in Table 4.
General Obligation Bonds totaling $83,310,000 comprises debt backed by the full faith and
credit of the government, Certificates of Obligation totaling $5,310,000 comprises of debt
backed by taxes and revenue generated from the golf course facility, and $16,610,000
represents bonds secured solely by water and sewer revenue. The other long-term debt relates
to compensating absences, notes payable, debt refunding and issuance, premiums, and
discounts.
Governmental activities' total debt increased by 5.9% and business -type activities' debt
decreased by 8.85%. The City had authorized but un -issued direct general obligation bonds
totaling $85,440,000 at fiscal year end. In September 2007, the City issued $11,145,000 in
General Obligation Bonds. The City's indebtedness increased $3,507,637 during the fiscal
year.
Allen Community Development Corporation had outstanding long-term debt totaling $7,188,439.
This amount represents $7,155,000 of sales tax revenue bonds secured by 4B sales tax
revenue and $33,439 which relates to the issuance costs and refunding of the bonds. Total
indebtedness of the ACDC decreased by $474,973 or 6.2%.
14
CITY OF ALLEN, TEXAS
MANAGEMENTS DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
_
Gmem,wYalnNMO�
Y a
PxaYMrylMlnvear<m
Bp,b �IBOes Lwq T—n
&aMbiwa MAinKs
Cu,cmvilAYb
Service
TN
General Obligation Bonds
'
M
4*7 M
=7
AA
tee]
am€
Gmcs BmCeO Po01
Sales Tax Revenue Bonds
At
Genial
9 Yon
eoms J
89jtoptll
70,9g1,W9
f 0,910.M1'U
78.3D9.W9
cmi6rala d
o ry o0
&n6a
4310.tlp
S,SW,0.0
5,910fW
6,`.Ap,0.0
eWSPande
18.610.M 18.18,OW
16.610.W]
18,18U.O10
Salm Tv
moa
]1
M
7,15 U
]BR=
Wl m
9wtlal Pod
88690.001
03.PoOAW
I010A01 MMM
71lSOb
7.825.0.0
113.93010
1Wb1SW0
Mstaq-Tenn M41
Cm4xMial
OOfp,pm
WnW d
.Wesw
2,9s9313
9.6%.F85
257811 LH.910
9,i08,894
9,g980i1
IMS PaPde
]6]R
IU,107
51,90.1 130.010
p7.475
2M,113
BON,giy
n.198.T9�
(1}S1,W5)
m.6an (02,281
(191 A9)
I1J3,<90)
(1.b1.8Y1
11,518.815)
Isauw,
NSnnsO
Pomnis
1.58.012
1.S]A16
111iT 11ffiI
1&131
IA910
1.]CU,AB
1Ts1AH
Td9
dqT—
i4m
Ce01
y98l.ee
9,p1138i
220 TA 20x.898
1949
99AI9
18]A3]
3.3F.3I3
T., f
91.83,88
M,Bftpi
16%A.iN 10,Oa,698
],IY.x30
],�3,tl2
t 118=.7
112,9MM
The City's bonds are insured resulting in AAA ratings. The underlying credit ratings from both
Moody's Investors Service and Standard and Poor's for the Citys General Obligation Bonds,
Community Development Corporation's Sales Tax Bonds and Water and Sewer Revenue
Bonds are shown below in Table 5. Additional information on the City's long-term debt can be
found in Note 5.
Table 5
Bond Ratings
15
Moody's Investors
Service
Standard & Poor's
General Obligation Bonds
Aa2
AA
Certificates of Obligation
Aa2
AA
Water & Sewer Revenue Bonds
A2
AA -
Sales Tax Revenue Bonds
At
15
CITY OF ALLEN, TEXAS
MANAGEMENTS DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES
Allen's current population is 78,804 and is expected to surpass 97,900 by the year 2011.
National employment statistics show the region as leading the country in employment growth,
ahead of much larger metropolitan areas. Allen takes a proactive approach to economic
development recruitment of new businesses and retention of existing businesses. The City has
earned a reputation as a premier location for high-tech manufacturing, assembly/distribution
facilities and corporate headquarters, retail and services. The reasonable cost of living, a highly
rated school district and home prices below the national average continue to make Allen an
attractive area for businesses to locate. The 2007-2008 budget reflects the efforts of the
governing body and city staff to address the need to provide services and facilities to support
our vibrant and growing community while maintaining a strong financial position.
At the end of fiscal year 2006-2007 the General Fund balance increased by $1,881,010. This
increased the operational expenditures in reserve from the budgeted 71.6 days to 108.9 days,
which is well above the City's financial policy of 60 days. This will have a positive effect on the
2007-2008 budget estimate of appmximately 88.2 days.
The certified assessed property value for 2007-2008 equates to an overall increase of
approximately $734 million (12.8%) from the preceding year. This has afforded the opportunity
for the City to reduce the property tax' mte for the fifteenth straight year from $0.558 to $0.557
per $100 valuation. Of the total tax rate, $0.426618 is dedicated to operations and maintenance
in the General Fund, and $0.130382 is dedicated to general obligation debt service.
The economic outlook from increased commercial development was projected to be very
favorable with the mixed use development at Montgomery Farms resulting in approximately
1,100,000 square feet of retail, residential apartments, and offices planned to open in the Spring.
of 2008. Although residential development was projected at a slower pace, the overall sales tax
receipts are projected to increase 7.7%. As of January 2008, sales tax revenue is 3.99% above
last year, but is 3.24% below projection. Finance staff will monitor the monthly sales tax
revenues and make adjustments as needed.
The 2007-2008 budget demonstrates the significant commitment to provide public safety to the
community and to operate and maintain each of the public facilities and the increasing staffing
levels they require. The 2007-2008 General Fund expenditure budget reflects a 15.2% increase
from the revised 2006-2007 budget. City-wide staffing levels will increase by 25 full-time
equivalent positions, which includes 21.5 from the General Fund to primarily address public
safety, construction activities that impact Parks, Building Codes and Planning, the Information
Technology Master Plan, and Finance monitoring of economic development incentives. With
the City's residential and commercial growth, there are needs for additional police and fire
personnel and equipment. The Capital Improvements Program includes Fire stations #5 and #6
being planned and bonds will be issued for the design and engineering of a new service center
to accommodate the increasing Fleet of the City. A five year Information Technology Strategic
Plan will be implemented city-wide requiring a $782,500 investment in 2007-2008. The City has
been impacted by the increase in commodity prices such as natural gas which affect the price of
electricity in Texas. Price increases in steel, concrete, and gasoline will affect the City's
operational and the capital project costs. City staff continue to look for ways to conserve energy
and utilize alternative solutions when cost efficient and to reevaluate the scope of capital
projects.
16
CITY OF ALLEN, TEXAS
MANAGEMENTS DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
In 2007-2008, the City plans to issue the remaining $250,000 of the un -issued 1999 general
obligation bonds. The City is also planning to issue $2,085,000 for the Arts of Collin County
project and $10,520,000 of new bonds that the voters approved in May 2007. The total bond
election amount approved was $77,895,000. During Fy2008, the City plans to issue $15 million
in Economic Development sales tax revenue bonds for Infrastructure associated with a large
commercial development at US75 Highway and Stacy Road. An additional $32 million in
Community Development sales tax bonds is planned to be issued for an Event Center project
and two parking garages. This City facility will be located within the Village of Allen retail
development which will have 1.5 million square feet of retail, office, and hotel space.
An annual 10% increase in the water rates for construction and irrigation are planned in early
2008. No increases are planned for residential, commercial, schools, or apartments. The sewer
rates are planned to be increased 7% for residential, 10% for schools and municipal accounts,
and 15% for commercial accounts. Due to the drought conditions in 2006, the City implemented
a water conservation and drought policy. In 2007, wet weather resulted in less watering by
residents and businesses which affected the Water and Sewer Fund operating revenues by
approximately $1,990,000 less than projected The rate increases previously mentioned are
necessary as North Texas Municipal Water District proceeds with capital expansion plans and
the costs associated with water and sewer service from the District rises. In addition to wet
weather reducing revenues, rash financing of water and sewer projects has reduced working
capital. However, the City will meet bond coverage requirements necessary to maintain working
capital minimum of 1.2 times the annual debt service obligations.
The Solid Waste Fund represents a stable operational service and staff has expanded
educational outreach programs and prepared grant requests for future grant cycles. No Solid
Waste Fund fee increases are planned in 2008.
The Parks and Recreation Enterprise Fund continues to record only revenue generating
activities and related costs. Operation and maintenance expenditures for facilities are being
budgeted in the General Fund. It is the goal of the City to have all revenue generating programs
be 100% sell sustaining.
The City finished the third year of operating the Chase Oaks Golf Course. Due to the wet
weather in 2007 affecting the number of rounds of play and revenues received, the City
subsidized the course with approximately, $570,652 to cover the revenue shortfalls. Expenses in
2007 were lower than in 2006 as staff made a concerted effort to monitor the expenditures on a
daily and weekly basis.. The clubhouse received major renovations that resulted in an enclosed
community, meeting room that can be used for parties, weddings, and by service clubs.
Improvements to the course were also necessary due to some flooding. The long range goal is
to improve the playability of the course with various improvements which should lead to more
rounds being played. Consequently, additional revenue for golf operations is the expected result
from the improvements.
Since healthcare costs continue to rise, the 2007-2008 budget includes an 8.6% budget
increase to cover projected costs for medical, prescriptions, dental and vision claims,
immunizations and physicals for employees and claims handling administration. Premium costs
for employees were not budgeted to increase due to a prudent Risk Management Fund balance
and positive trend in claims history. The City contributes about 76% of the cost of the health
insurance premiums.
17
CITY OF ALLEN, TEXAS
MANAGEMENTS DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(UNAUDITED)
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(214)509-4626.
IE7
BASIC FINANCIAL STATEMENTS
gGT t INTeG
♦ R/r
CITY GF PUFF."
CITY OF ALLEN, TEXAS EXHIBIT 1
STATEMENT OF NET ASSETS
AS OF SEPTEMBER 30, 2007
ASSETS
Cash and cash equivalents $
InvesMants
Receivables (net of alle nce for uncollectibles)
Internal balances
PrepaM items and other assets
Inventories
RestncleJ cash and cash equivalents
Caphal assets:
Non -depreciable
Depreciable (net of depreciation)
Deferral Marges
TOTAL ASSETS
LIABILITIES
Accounts payable
Accrued liabilities
Accrued interest payable
Customer deposlts
Unearned revenue
Retainage payable
Noncurrent liabilities:
Due w8hth one year
Due in more than one year
TOTAL LIABILITIES
NET ASSETS
Invested in capital assets (mit of related deM)
Restricted for debt service
Unrestricted
TOTAL NET ASSETS
The Notes M Financial Statements
are an integral part of this statement
PRIMARY GOVERNMENT
13,550,487
127.689,635
7,591,883
295,079,588
GOVERNMENTAL
BUSINESS -TYPE
1,869,380
COMPONENT
ACTIVITIES
ACTMTIES
TOTAL
UNITS
126.722,428 $
595,249,882 $
23,293,713
2,795,629
23,447,595 $
12,439,405 $
35,887,000 $
7,378,386
31.880.848
6.404,397
38,265,243
4,600558
4,223,331
4,807,724
9,031,055
1,766,376
(708,OB9)
708,089
-
-
-
11,050
11,050
-
131,481
131,481
-
-
2.174,961
2,174,961
-
114,139828
13,550,487
127.689,635
7,591,883
295,079,588
88,345,282
381,424,870
1,869,380
482,955
151,632
634,587
87,130
$ 468,527,454 $
126.722,428 $
595,249,882 $
23,293,713
$ 2,1911 $
1,782,518 $
3,9112886 5
1,791,700
2,893,751
572,162
3,485,913
26,525
455,464
263,119
718,583
12,884
-
1,335,451
1,335,451
-
2,795,629
-
2,795,629
-
205,697
-
205,697
73.940
6.621.M
1.806,297
8,427,363
495,000
85,382,812
15.033,423
100,396.235
6.693,439
$ 100,5%,187 $
20,792.970 $
121,327,157 $
9,093,488
333,490275
83.485,274
416,975,549
2,272,824
1.099,998
336,842
1,436,840
-
33,402,994
22,107,342
55,510,338
11,927.401
$ 367,993,267 %
105,929,458 $
473,922,725 $
14,200,225
19
CITY OF ALLEN, TEXAS
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Program Revenues
The Notes to Financial Statements
are an integral part of this statement.
General revenues:
Taxes:
Property taxes, levied for general purposes
Sales taxes
Franchise taxes
Hotel motel taxes
Other taxes
Investment earnings
Gain on sale of capital assets
Miscellaneous
Transfers
Total general revenues and transfers
CHANGE IN NET ASSETS
NET ASSETS, beginning of year
NET ASSETS, end of year
41]
Charges for
Operating Grants
Capital Grants
Expenses
Services
and Contributions
and Contributions
Functions/Program Activities
PRIMARY GOVERNMENT:
Govemm x,tal Activities:
General government
$
11,171,912 $
488,618 $
- $
-
Public safety
20,718,948
984,340
590,045
-
Public works
13,178,850
180,773
-
18,898,486
Culture and recreation
14,912,287
2,340,027
646,630
-
Community development
2,031,522
2,549,806
1,530,737
-
Interestonlong-term debt
4,040,682
Total governmental activities
66,054,199
6,543,564
2,767,412
18.896,486
Business -type Activities:
Water and sewer
19,463,383
19,394,286
-
6,029,069
Environmental waste services
3,921,060
4,597,805
-
-
Drainage
705,503
975,639
-
Golf Come
1,603,174
1,340,087
Total business -type activities
25,893,120
26.307,817
6,029,069
TOTAL PRIMARY GOVERNMENT
$
91.947.319 $_
32.851.381 $
2.767.412 $
24.925.555
COMPONENT UNITS:
Allen Economic Development Corporation
$
6,269,128 $
- $
- $
-
Allen Community Development Corporation
2,412,520
TOTAL COMPONENT UNITS
$
8.681.648 $
$
It
The Notes to Financial Statements
are an integral part of this statement.
General revenues:
Taxes:
Property taxes, levied for general purposes
Sales taxes
Franchise taxes
Hotel motel taxes
Other taxes
Investment earnings
Gain on sale of capital assets
Miscellaneous
Transfers
Total general revenues and transfers
CHANGE IN NET ASSETS
NET ASSETS, beginning of year
NET ASSETS, end of year
41]
EXHIBIT 2
Net(Ex me)Revenue and
Changes in Net Assets
Pdmary Cg mment
Gwffn. ntal Business - Type COMPONENT
AcWdies Ac8vibes TOTAL UNITS
$ (10,683,294) $
-
$ (10,683,294) $ -
(19,144,561)
-
(19,144,661) -
5,898,409
-
5.898,409 -
(11,925,630)
-
(11,925,630) -
2,049,021
-
2,049,021 -
(4,D40,682)
1.893.830
(4,040,682)
1,893,830
137,896,7371
3,011.145
(37,846,737)
4,280.655
- 761,733
-
5,959,972
5,959,972 -
-
676,745
676,745 -
-
270,136
270,138 -
(2,718,588)
(463,D87)
(463,087)
56,875,347
(1,449,078)
6.443,766
6,443,766
19,028,610
S (32648737) $
6.443.766
$ 131.402.9711 $
348,964,657
$ - $
-
$ - $ (6,269,128)
$ 387.993.267 $
105.829.458 $
(2,412,520)
14.200.225
S E
$ $ 18.681.6481
$ 32,922,229 $
- $
32.922.229 $
-
9.765,380
-
9,755,380
9,674,144
4,931,008
-
4,931,008
-
673,383
-
673,383
-
1.893.830
-
1,893,830
-
3,011.145
1,269,510
4,280.655
- 761,733
77,938
-
77,938
-
891,848
-
891,846
22,115
2,718.588
(2,718,588)
56,875,347
(1,449,078)
65,426,269
10,457,992
19,028,610
4,994,688
24,023,298
1,7]8,344
348,964,657
100.934.770
449,899,427
12,423.881
$ 387.993.267 $
105.829.458 $
473.922.]25 $
14.200.225
21
CITY OF ALLEN, TEXAS
BALANCE SHEET
GOVERNMENTAL FUNDS
SEPTEMBER 30, 2007
The Notes b Financial Statements
are an integral part of this statement.
22
GENERAL
DEBT
FACILITIES
CAPITAL
GENERAL
SERVICE
AGREEMENT
PROJECTS
ASSETS
Cash and cash Nui.lenls
S
847,111 $
1,434.750 f
2,59B,]95 f
5,870,780
Ine rls
12,289,447
-
3,339,310
3.072.227
Receivables, net of alb noes far
uncellectibles:
Ad valorem taxes
340,921
146,476
-
Sales taxes
1,878,839
-
-
-
Accountsreceivable
Amued interest
108,8]9
-
35884
32.812
Otter
1,389,040
2,018
-
-
Specialaseasanerda
-
187,557
TOTAL ASSETS
f
18,712,837 $
1583 2M f
5.9]3)89 f
8,963.378
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable
f
1,561.408 $
- $
23,887 f
229,328
Accrn dliabilities
1.437,285
-
-
782,338
Interest payable
36,810
Retainage payable
-
-
57,325
121,40]
Deferretl revenue
340,821
146,4n
2,]23.041
-
TOTALLIABILITIES
3,339,594
183,287
2804,253
1,133,071
FUND BALANCES
Reserved for:
E.rnbrences
-
-
154.712
1,784.737
Debt service
-
1,399.985
-
-
Unreserved. reported in:
General fund
13,373,243
-
-
-
Facilitiesa9reenrent
-
-
3,014,8041
-
General obligation band fund
-
-
-
-
Specialrevenuelunds
-
-
-
-
Capitalprojectsfunds
-
8.045.588
TOTAL FUND BALANCES
13,373,243
1,389,985
3,189.518
7,830,305
TOTAL LIABILITIES AND FUND BALANCES
S
18,)12,53] f
1,583,272 S
5,9]3,769 $
8,963,3]8
The Notes b Financial Statements
are an integral part of this statement.
22
EXHIBIT 3
GENERAL OTHER TOTAL
OBLIGATION GOVERNMENTAL GOVERNMENTAL
BOND FUNDS FUNDS
S 3,131,576 E 3.03,082 $ 17,188,104
10,105,881 1,037,414 29,824,279
- - 4B2,ae2
119,0.98 129,439
101,932 11,060 29],181
- - 1,371,086
182,55-/
S 13,345,389 S 4,631,025 E 51,209,888
E 91,516 E
15.593 $
2.8,832
-
56,849
2,216,450
38,810
19,051
2.914
205,691
22,568
3,293,021
110,882
291,944
2,862,816
9,223 9,019 2,12,301
1,39,985
13,313,243
3,014,804
13,131,949 - 13,132,849
1,545,022 1,545,021
2,203,915 8,149,543
13,234,222 4,339,081 43.346.852
E 13.345.389 E 4,831,025 $ 51,20,868
23
CfTY OF ALLEN, TEXAS
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET ASSETS
SEPTEMBER 30,2007
EXHIBIT 4
Total fund balances - governmental funds
$ 43,346,852
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.
409,218,816
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.
482,955
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.
(418,654)
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 ($706,089) and to capital assets ($2,602,645).
6,859,778
Revenues earned but not available within sixty days of the year end are not
recognized as revenue on the fund financial statements.
487,398
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.
(91,983,878)
Net assets of governmental activities
$ 367,993,267
The Notes to the Basic Financial Statements
are an integral part of this statement.
24
ats,t GY * Icy TEC
u RST.
CITY OF Pbbf-•-
CITY OF ALLEN, TEXAS
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FOR THE YEAR ENDED SEPTEMBER 30.2007
The Notes to Financial Statements
are an integral part of this statement.
25
GENERAL
DEBT
FACILITIES
CAPITAL
GENERAL
SERVICE
AGREEMENT
PROJECTS
REVENUES
Ad valorem taxes, penalties and interest
$ 23,230,344 E
9,957,899 $
- $
-
Franchisetaxes
4,886,243
-
-
Municipalsalestax
9,755,380
-
-
Licenses, permits and fees
1,837.556
-
-
-
Charges for services
1,404,376
-
-
770,929
Court fines
1,727,693
-
-
-
Gft and contributions
152,018
-
1,527,029
-
Hotel / molc4 fees
_
_
_
-
Recreabonfees
-
-
.
Intergovernmental
11,826
-
-
1,359,628
Investment earnings
969,303
316,837
343,099
415,880
Miscellaneous
261,404
721,002
Total revenues
44,016,143
10,274,736
1,870,128
3,267,219
EXPENDITURES
Current
General government
9,111,806
-
-
76,095
Public safety
19,825,653
-
-
-
Public v s
3,025,105
-
-
Cultureandrecreation
8,772,497
Community development
1,893,229
-
-
_
Capital outlay
-
-
1,527,029
3,802,831
Debt service:
Principal retirement
-
6,325,000
-
Interest and fiscal charges
3,843,462
Total expenditures
42.628.290
10.168,462
1.527,029
3,878,926
Excess (deficiency) of revenues
over (under) expenditures
1,387,853
106,274
343,089
(611,707)
OTHER FINANCING SOURCES (USES)
Issuance of debt
-
-
Transfers from other funds
2,839,250
-
-
2,068,382
Transfers to other funds
(2,180,010)
-
-
.
Sale of capital assets
33,917
Total other financing sources (uses)
493,157
2,068,362
NET CHANGE IN FUND BALANCES
1,881,010
108,274
343,089
1,456,655
FUND BALANCES, BEGINNING OF YEAR
11,492.233
1,293,711
2.826,417
6,373,650
FUND BALANCES, END OF YEAR
$ 13,373,243 $
1,399,985 $
3.169,516 $
7,830,305
The Notes to Financial Statements
are an integral part of this statement.
25
EXHIBIT 5
GENERAL
OTHER
TOTAL
OBLIGATION
GOVERNMENTAL
GOVERNMENTAL
BOND
FUNDS
FUNDS
16,367
$ - $
- $
33,188.243
13 705,207
64,765
4,931,008
12,688,827
-9,755.380
5,490,996
-
665,4 67
2,303,023
43.346.852
-2,176,305
166,137
1,893,830
181,673
1,860,720
-
673,383
673,383
2,098,051
2,098,051
765,592
2,137,046
245,817
288,136
2,578,852
10.138
133.181
1.125,725
255.955
5.036,385
64,720 566
1,283,817
180,694
10,632,412
.
430,894
20,256,547
_
46,747
3,071,852
2,957,211
11,629,708
-138,725
2,031,954
83.434
2,532,717
7,948,011
_
-
6,325,000
3.M,462
1,347,251
6,186,988
65.738.946
(11,091,296) (1.150,603) (1,016,380)
11,145,000
-
11,145,000
-
370,193
5,077,795
(387,862)
(2,567,872)
16,367
50,284
11 145,000
(1,312)
13 705,207
10,063.704
(1,151,915)
12,688,827
3,181,018
5,490,996
30 658,025
j 13,234.722 $
4,339,081 $
43.346.852
a
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, 2007
EXHIBIT 6
Net change in fund balances - total governmental funds
$ 12,688,827
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.
8,430,521
Governmental funds do not recognize assets contributed by developers. However, in the
statement of activities the fair market value of those assets is recognized as revenue,
then allocated over Meir estimated useful lives and reported as depreciation expense.
17,418,016
Depreciation expense on capital assets is reported in the statement of activities but
does not require the use of current financial resources. Therefore, depreciation
expense is not reported as expenditures in the governmental funds.
(15,297,044)
In governmental fund financial statements , the proceeds from sale of assets am shown
as an increase in financial resources. However, in the statement of activities,
the gain or loss is calculated and reported.
(22,052)
The proceeds from issuance of long-term debt (e.g. bonds) provides current financial
resources to governmental funds ($11,145,000), while the repayment of the principal of
long -tens debt consumes the current financial resources of governmental funds
($6,392,925). Neither transaction, however, has any effect on net assets.
(4,752,075)
Governmental funds report the effect of issuance costs, premiums, discounts, and similar
items when debt is first issued. However, these amounts are deferred and amortized
in the government -wide financial statements.
(9,790)
Current year changes in long-term liability for compensated absences do not require
the use of current financial resources and, therefore, are not reported as expenditures
in governmental funds.
(252,829)
Current year changes in accrued interest payable do not require the use of current
financial resources and, therefore, are not reported as expenditures in governmental funds.
(35,167)
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 operating and
non-operating income and transfers of the internal service funds is reported with
governmental activities net of amounts allocated to business -type activities.
1,126,217
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.
(266,014)
Change in Net Assets of Governmental activities
$ 19,028,610
The Notes to the Basic Financial Statements
are an integral part of this statement.
27
CITY OF ALLEN, TEXAS
EXHIBIT T
STATEMENT OF NET ASSETS
S 1.51&BN $
1]5,4]1 S
n.774S
8].825 $
1,]82,518 $
tY.BX
PROPRIETARY FUNDS
599,331
21,14]
8.867
M.517
572.162
-
SEPTEMBER 30 2007
-
18,828
10,791
19,789
47•404
Imi ned bel nd reponed demo
119X585
BUBI NESSTYPE ACTINTIES
3.131
-
.
01],3]1
Payable (mm reetH.. easels:
ENFFRPRISE FUNDS
219.0:
405,853
GOVERNMENIAL
26,)929]9
755237
Revenue bonds payable-umenl
15]5.04
-
ACTIVERES
1.5]5.00
WATERAND
SOLID
3.584
GOLF
INTEENN. SERVICE
36,053
SEVER
WASTE
DRNNAGE
CWNSE
TOTAL
FUNDS
ASSETS
283.119
Unrastnded
Amued cmwnsaled absences conenl
147,820
1.2ae695
-
CURRENT ASSETS
Cas, m] oM'ulnnOenla f
B,9]0.293 S
04
1,5509 f
1,21Y 0,5 S
233.047 S
12.4.'3,105 S
8,251.491
InvnMenb
0.101.047
_
e,b1,397
2.030.507
Remivffika, net Ndbxen¢ Ior mmlkdl0ks'
Total parent lindles,
5.3X,887
213.740
42,432
102402
5759,W
qup,ryg
1,123,318
351,010
53,912
B,BIB
441),]58
2.X5
Amu J IM¢resl
80.101
-
-
0M
21.751
menmen321.583
-
321.4, 504
'
Inwnbnes
131.101
131,481
PrepaE ilrns
-
-
11,050
ll.-
macOlvMenb
ReaOkleE�and! OM
2.1]1601
-
-
21]1.90174.961
TdN alrenl essNa
21812.X2
2550.043
1,281.498
250.918
2 Sms,o18
0322.1,
NONCURRENT ASSETS
CgPRrY ASSETS
3,350.645
3.380835
'
Ipq
ONx i�rymvMNnls
188,132
-
458.132
Tsetse. tmka. send pump slalFina
inn,52.510
121152.510
V.I.
780.655
- m.HB
102,079
-
WT.182
3AY5,798
MxTincy mtl eWigecA
2.914.093
9.819
3)3,)14
Y9,5W
9,,1,114
1.161,326
Fumeum and flqums
11.114
-
-
10.504
n.CCe
'
conssumm F prapms
10189.]]2
-
10.189,]]2
TolelosedelsevNs
138,)72,049
51.287
971,015
3X,4@
141,089,123
5.0e3,126
Less'. eramulNed deprecisetim
(10.4T15]2)
(W.0B3)
0,04.5311
(247,M)
(41,173,7311
(2.W.479)
Cep"sonels,nd0tacdamuklNdepreda6.
99.218.237
3,581
371,414
]3414
88885804
2002.815
DEFERRED CHARGES
BvMiawa ....nNMemo'bes n
151832
151,m
TMM ndlanrenl eaxb
04X9059
3,554
571114
n.454
104017.321
2042&5
TOTALASSETS S 1213)2.]50 $ 2.261277 S 1.865.912 S
323100 $ 128,016.339 $
10.924.748
LUNLITIES AND NET ASSETS
CURRENT LIABIUTIES
Acwumepaynek
S 1.51&BN $
1]5,4]1 S
n.774S
8].825 $
1,]82,518 $
tY.BX
Adored lla...
599,331
21,14]
8.867
M.517
572.162
-
AdRez ompensated absmrea-wrtbed
-
18,828
10,791
19,789
47•404
Imi ned bel nd reponed demo
119X585
5.351
3.131
-
.
01],3]1
Payable (mm reetH.. easels:
20.317.452
219.0:
405,853
210.5%
26,)929]9
755237
Revenue bonds payable-umenl
15]5.04
-
1.5]5.00
-
capilalleasesparaEle-emrenl
3.584
-
-
36,053
3a.BX
RA... for Rvenue bora pdndpm and Wnle.
,-ealmereslpayable
253,119
-
-
-
283.119
Unrastnded
Amued cmwnsaled absences conenl
147,820
1.2ae695
-
-
141826
-
Cuslomerdeposilspayable
13089723
S 112.412
$ 13.2X.326 S
25,485
1,335,451
Total parent lindles,
5.3X,887
213.740
42,432
102402
5759,W
]50.23]
NONCURRENT LIABILITIES
Revenue bonds payable
14,950,206
-
-
11,9X,226
-
Coplblbas,spayable
-
-
15.140
15.110
-
pmuMmnpensNedabsmces
10350
5251
3.p1
12.936
82.077
Taal .-I
119X585
5.351
3.131
X079
15X342]
-
TOTALUANUTIES
20.317.452
219.0:
405,853
210.5%
26,)929]9
755237
NET ASSETS
Invested'. deelel essels. nN of MMW debt
32,X9.025
3.584
571.114
21,251
W,b ,2]4
1X2.&5
RA... for Rvenue bora pdndpm and Wnle.
336,142
-
-
-
336.6K'
-
Unrastnded
17,729U1
2231.526
1.2ae695
91.591
21.401,253
7565957
TOTAL NET ASSETS
i 104.955.226 5 2.335.126 $
1.020.0`19
S 112.412
$ 13.2X.326 S
10.1X.512
Ttle Notes to Financial Statements
are en integral pant of this Net e..R
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, 2007
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 $ 105,223,369
Internal service funds are used by management to charge the costs of replacing
machinery and equipment, fleet management, workers compensation, properly liability
loss, medical and dental insurance, and health claims to individual funds.
The assets and liabilities of internal service funds are included in the governmental
activities in the government -wide statement of net assets. The amount shown
represents the net receivable from internal service funds allocated to business -type
activities since the adoption of GASB 34. 706,089
Total net assets of business -type activities
The Notes to Financial Statements
are an integral part of this statement.
29
$ 105,929,458
CRY OF ALLEN,T S
&Y II!]y:L[ef:IaAII
OPERATING EXPENSES
Ponamal ¢erv9wa
2XG,112
BUSINES&TYPEA 11NIIIES
289,]21
981,802
4,19,BW
iN,9M
CDNatluM mniaae
INIERPRSE FUND$
3,631,418
81.916
GOVEWYIEMAL
15.191.133
8,058,991
Mart.—
2]],231
ACTVI11E8
7,051
WATE
pOF
123,10
NN
2$832
SEWER
WASE DRAINAGE
OURSE
TOTAL
FLININS
OPERATING REVENUES
17,37
72,77
1,592819
6861229
aM
CtW�9az b Was aM aervlue:
46595
63,113
33,501
P1,701
1,X8,081
Wa
TMal o9eraen9 er,P s
18,686,911
$
10,992.395 i
-
Seeerc8e
0,681,851
DPEMTING INCOME (LOSS)
7,241,215
-
GWmOMOn%eWes
211,-
-
-
2L1,BB5
-
Ge�Bege ions
1,552.398
1,552,388
1,130,130
SerWa c4egenes
164517
- NS73
1,317,958
1,8511018
7,311,182
Ora2aq Me
-
40,1144
-
929.244
Miscebrews
808,286
15,40
42.131
8]3,02
Total r ft revenues
1989130
4,SWBN 8)5.839
1,310,08)
NATA17
7,408578
OPERATING EXPENSES
Ponamal ¢erv9wa
2XG,112
219,162
289,]21
981,802
4,19,BW
iN,9M
CDNatluM mniaae
10,653,668
3,631,418
81.916
515,133
15.191.133
8,058,991
Mart.—
2]],231
176.785
7,051
W2,050
-
SUPPI"
123,10
9,3B
2$832
123,916
285,118
Dapecia5on
18M,X6
9,119
17,37
72,77
1,592819
6861229
aM
126,182
46595
63,113
33,501
P1,701
1,X8,081
NETASSETS, BEGINNING OFYFAR
TMal o9eraen9 er,P s
18,686,911
3.921862
M,5N
1,803,171
25,110,816
0,681,851
DPEMTING INCOME (LOSS)
M],3]5
6]6,)0.5
MAN
(10,48])
1,191110
526,627
NON-0PERATNG REVEMES(EXPENSES)
InreaO eaM,,t
1,130,130
6,08
561180
-
1,X8$10
133,283
InWWMex,,s a
(658339)
-
-
(858839)
WOlcroiWl ascela
GeNIa"m
36,188
Ceaelolan.M N..
LBM,an
1
tBN,aM
TOM rona0nauq...
;1050
0566
580
2.30,818
170.M2
INCOME (LOSS) BEFORE CAPITAL
COMRIBUTIO4S AND TRANSFERS 28MBO )5)531 3X839 WIN?) 3,dB9.S12 07,119
CAPITAL CONTRIBUTIONS ANDTMNSFERS
Lap4almM0uBDne
1.138.592
-
-
I,f05W
TWnSWR FOmd6u M1
1,495,115
SM.80
48N3W
208,05
TWrcbnboWer funds
(4,540475)
,41.195)
(1M,6)6)
-
(4.7M885)
-
TOMI OaPbI m8n2e4snsaM lWrs(era
1,ON,N2
(71,135)
(1M57)
SM,=
1,121806
211,80.5
CHANGE IN NET MSET5
3,0800
BRIAN
10.05
107,885
4.914.821
1,X8,081
NETASSETS, BEGINNING OFYFAR
N,903N
1,651,901
1,Ni.994
5377
10,M8,516
B,962126
NETASSETS,ENDO'YPAR
$ 1N.N5398 $ 23%,10 S
18X819 S
112,812
S 10,223,30 $
19,1011,512
TM NMea b FBW .I SWten1en15
are an 89e9W1 Put a Mia statement
30
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, 2007
Amounts reported for business -type activities In the statement of activities
are different because:
EXHIBIT 10
Net change in fund net assets- total proprietary funds $ 4,914,821
Internal service funds are used by management to charge the costs of replacing
machinery and equipment, fleet management, workers compensation, property liability
loss, medical and dental insurance, and health claims to individual funds.
The net expenses of certain activities of internal service funds is allocated to
business -type activities. 79,867
Change in net assets of business -type activities $ 4,994,688
The Notes to Financial Statements
are an integral part of this statement.
31
CITY OF ALLEN, TEXAS
ENTERPRISE FUNDS
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
(1,58900)
- - 11.9)0.000)
Mw . hes pal onlm .dell
(8571.430) -
(amoa )
EXHIBITII
(6.66).)0)
(2AB12) (6A01.390)
BUSWESS-TYPE ACTIVITIES
(00.)19) (0.)13)
Pmaetls M1wn sale dcapil.l esmas
flMae dimeshnenl seadtle
II.IW.roI
ENTERPRISE FUNDS
1.800,1"
1,888,95
GOVERNMENTAL
P,cpWM1an SNe ant mWOMdlnwbnent eecu,Nm
7.M.a5
- 7,a652B5
AC IES
1.106.905
WATERMD
SOLID
1.N5.985
GOLF
NeleW pa+Ned Oy xvestin9 aNWke
INTERNALSERVIGE
mm
SEWFR
WASTE
DRAINAGE
COURSE
TOTAL
FUNDS
CASH FLOWS FROM OPERATING ACTNRIES
179116 (65s,2.1)
1'mm
CSHANDCASHEOUWALENTS,BEGINNIHGQFYF.AR
12.3N.M
1315.178
1027531
Cash nreireelmm orstomas
$ 18.502.410 i
4.530,653 S m.m S 1.3aBAb 3
35.MBA16 $
1.239.785 $
Cash-eira0 ft n hansaAws xM pVwM1
6361.9)1
BECDNCL Al OF OPEMTING INCOME (LOS$)
]A,5,OR
Cashpaidl empbyenlw servku
(2,81538)
1235,995)
P(!p,809)
9)9;643)
(4.B 70)
(156,679)
Cash Widf 9.. sarvics
(11412.381)
13.587,1071
(342,181)
(735.516)
(1..4].03)
(2413.511)
Cash paid M dtima
roMuab pa..id. bV (used h IF9 MAMOes:
85159151
NN b9)profsbf8 (u in) apenti,getlMlMs
.4911.118
887.051
310.415
413 o3 )
1A1A
1,169.921
CASH FLOW$ FROM NONLAPRAL
".]38 1.512,10
6FB,iR
LN,ge x assent arE NaNllllw:
FNMILINGA TIES
Iliweue)dwenein a¢w,nd rec«aue
(191.118)
(1x119)
93931)
e,aat (839795)
TysfwSM1vn 'p"*`
1.495.615
-
(M.o73)
m.6m
2,156.47
MA85
Rsalseba6w NMa
(0.510.1]5)
9.41351
119).6751
21(on 21,5]3
H.tmm)
0egeasexin.®ntpnea
TIM UN Paintpy (aseG xlnmogMlfinencvq aaNMic (AW.530)
91.1351
000.5751
660.652
(2.826.588)
M8865
GSH FLOWS FROM CAPITAL AND
106.131
15.08
zst9 (137,M58
(II.-
W..(.-se)In
.
Mcmeeldenms.),h.>Pdmbenu
11&345
RM ,Paid m,e-h. W .Mta Ms
(1,58900)
- - 11.9)0.000)
Mw . hes pal onlm .dell
(8571.430) -
(amoa )
NquMNOnaM canaVuc4m dteplelaveLL
(6.66).)0)
(2AB12) (6A01.390)
Capltl baedw,n paymaX
(00.)19) (0.)13)
Pmaetls M1wn sale dcapil.l esmas
flMae dimeshnenl seadtle
II.IW.roI
CmNRnllbnak da-lp ars
1.800,1"
1,888,95
Not aaah(u m) cap. and matednne 1M.�.itls
9]333071
(112]25) n.MM)
19399391
CASH ROWS MOM FSTING AC IES
flMae dimeshnenl seadtle
II.IW.roI
-
- (4.405,5M)
895.433
P,cpWM1an SNe ant mWOMdlnwbnent eecu,Nm
7.M.a5
- 7,a652B5
Inw t lnwsanenk
1.106.905
mm
Y.IN
1.N5.985
338990
NeleW pa+Ned Oy xvestin9 aNWke
4.565.W0
mm
MAN
I.71M.700
11394513
NET CH 04 CASH AND CASH EQUIVALENTS
11,7391011
MM2
202.29)
179116 (65s,2.1)
1'mm
CSHANDCASHEOUWALENTS,BEGINNIHGQFYF.AR
12.3N.M
1315.178
1027531
34'm 15z21M5
1,431425
CASH .NDC 8 EQUWAIENTS. END OF YEAR
$ 11.145,2% S ""Al S
1.239.785 $
213.253 3 KW.W 3
6361.9)1
BECDNCL Al OF OPEMTING INCOME (LOS$)
1D NET CASH PRO V IDED BY OKRA dNC ACTMIES
NMppuatlrg lncpne lMlSs)
$ 707,375 f
876.70 f
"D.135S
I .W)S 1.19110 f
598.27
A*ma nmd to recmclM apeamg xam,e (bM)
roMuab pa..id. bV (used h IF9 MAMOes:
atopen
QegeGetXn e9) emptlzatlm aslwnp
0,383,986
9,09
11.88
".]38 1.512,10
6FB,iR
LN,ge x assent arE NaNllllw:
Iliweue)dwenein a¢w,nd rec«aue
(191.118)
(1x119)
93931)
e,aat (839795)
(2.Ms1
Ihwease)x lvablu
-
(M.o73)
(2z.5n
srpow
(l,ttufle)xgepaNs
-
21(on 21,5]3
-
0egeasexin.®ntpnea
17,726
119 9,956
ev
pbli.
15563a5)
106.131
15.08
zst9 (137,M58
(II.-
W..(.-se)In
.
Mcmeeldenms.),h.>Pdmbenu
11&345
P3W9)
199
ta7.1w
-
w-,.rhuhMyd)N mmpensaua abemw
13.379
87.2331
9.78)
(10.%1) (9).379
-
Mc,nsemutlFrydePoZR
59.319
53.318
Tdal.d hnen6
3,M.741
M.XW
0.179
0.878 .41221%
6413,291
Nel rant goNdM OV(uaed inl PoWetlrg ectlMlleS
$ 3.971.118 $
0701 f
311315 f DIa M91S 1.613873 3
1,169921
NONGl3H NVESING ACTN91E3-
CM,Nelntlnla9 rYro dlnroebnmb
3 8.531 $_S_$
f B.5% S
K.711
NOHLASN FINANC W G AC11 V Rff 5:
CcnIBAw. d m,Aal mde M1 d ,ads
$ 1.139.50 s
s
f
3 1.138.50 S
.n.l.am d total sent W T. abtemem d nel ua.
Cash hal uh rydrNMib-nmed
s 81970,293 S
1.918a1 $
I'm1 5 $
21.4239 S 12M.W7 f
a. tal
PaaniaMl aan aMCIDb egWvel.nM
2,174,961
2,17401
CASNAIIOCASHFQUWLLEMTAENDOFYFAR
$ 11.10.254 f 1.117&01 S 3239.785 S
213339 $ 11.569.9% S
6.WIAB1
The Notes b Flrlarval StaWavem
ere an I.".[ part o7Mis atal.
32
CITY OF ALLEN, TEXAS
COMPONENTUNTTS
STATEMENT OF NET ASSETS
SEPTEMBER 30, 2007
EXHIBIT 12
ALLEN
ALLEN
ECONOMIC
COMMUNITY
DEVELOPMENT
DEVELOPMENT
CORPORATION
CORPORATION
TOTALS
ASSETS
CURRENT ASSETS
Cash and rash ecuivalena
$ 85(l,156
S B,522,230
$ ],3]8.388
Inveetmer9s
1,741,319
2,858239
4,801
Saba tax mcalwde
838,319
838,320
1,818,839
AccoudsreceMNa
1.301
39.301
40,802
Arzmetl interest rec ivabls
18,598
30,537
49,135
Todlarmntassets
3,455,883
10.259.827
13,145.320
CAPITAL ASSETS
Land
7.381.605
Lana improvements
20].2]8
-
207.738
Furniture an i fthaes
74,028
-
14,DM
Impr nnerds other Man buildings
3,128,289
-
3.1M,289
Total capital assets
10,791
-
10,195,200
Less: a=nnuated depreciation
(1.333.937)
N,339,D31)
Capital assals, net a accumulated depreciation
9,481,M3
-
9,481,289
DEFERRED CHARGES
Bad ksuance coca, rwtAamaltreeon
87,130
81,130
TOTAL r135ET5
S 12,918,958
$ 10.378,757
8 29,293.113
LIABILITIES AND NET A59ET5
WRRENT LIABILITIES
Accounte payable
$ 1,448,15]
$ 313,543
S 1,181,100
AcrnaW interest payeNe
-
28.525
M,525
Acrruetl and otter liabilities
12,884
12,884
Retainage payable
-
73,940
73,910
Revenue bads payable - current
495.000
495.000
Total carent MdAttes
1.481,041
939,ODB
2.400,019
WO URRENTLNBLITIES
Reienue is payable (rIM
ans
ndon k..
tlisccuna aM defertatl amount on refadap)
8,899.439
8,683,439
Total mnanent labllilies
6,889,439
8,893,439
TOTAL LIABILITIES
1,481.041
],832,(11
9.093.488
NETASSETS (ACCUMULATED DEFICIT)
In asled in capital asseA ,
net ci related deIX
9,481,M3
(1,188.439)
z2n.824
LAvestticletl
1.89/.852
9.932.748
11,921.401
TOTAL NET ASSETS
(ACCUMULATED DEFICIT)
S 11.4%,915
S 27".310
$ 14=,,5
The Notes b Financial Statements
are an integral p" this statement.
CITY OF ALLEN, TEXAS EXHIBIT 13
STATEMENT OF ACTIVITIES
COMPONENT UNITS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Net (Esi atue) RayamO aM
Program Revenues Chaingesh Nat Assets
COMPONENT UNITS
ALLEN ALLEN
Operating ECONOMIC COMMUNITY
Charges for Grans arM DEVELOPMENT DEVELOPMENT
Expenses Servoes CORPORATION CORPORATION TOTALS
FurrboNProgrem A twiues
COMPONENT UNITS
Allen Economic
Developmenl Corporation $ 6,269,128 $ - i - $ (8,289,128) $ - $ (6289,128)
Allen Community
Development Corporation 2,412 520 - (2,412,520) (2.41;$20)
TOTAL COMPONENT UNITS $ 8.881.848 S $ $ (8.289.1281 f 2.4125201 S 18.681,fi48)
The Notes to Financial Statements are
an integral part of this statement
G menal revenues.
Sales saes
Interest on noe amens
Miscellaneous
Toll general ry ernes
CHANGE IN NET ASSETS
NET ASSETS, beginning of year
NET ASSETS, and of year
34
$ 4,837,072 8
4,837,072
$ 9,674,1"
310,880
450,743
761,733
22,115
22.115
5.170,177
5,287,815
10,457,892
(1,098,951)
2.875,295
1,778,344
12,554,888
(130,985)
12,423,881
$ 11.455.915 $
2,7M.310
S 14200.225
aESpECT 1
ti
Py
4�
�qTE
CR
�r
t
{ °jrr OF A�.1.iN
NOTES TO
FINANCIAL STATEMENTS
0.O,SpECT * INTeG
{� RST.
C�rV OF AL�'�•-
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
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 Stabiles of 1925. In 1979, the City adopted a charter making It a home rule city
operating under a CoundkManager form of government. The City provides such services as are
authorized by its charter to advance the welfare, healdr, 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 by 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 signficance 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 if its officials appoint a voting
majority of an organization's governing body and either it is able to impose its will on that organization
or there is a potential for the organization to provide specific financial benefits to, or to impose specific
financial burdens on, the primary government. 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.
35
CIN OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE1. 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 ACOC 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 (i.e., the statement of net assets and the statement of
activities) report information on all of the non-fiduclary activities of the primary government and its
component units. The effect of interfund activity, within the governmental and business -type activities
columns, has been removed from these statements; however, interfund services provided and used are
not eliminated in the process of consolidation. 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. Additionally, the primary government is
reported separately from the legally separate component units for which the primary government is
financially accountable.
The statement of activities demonstrates the degree to which the direct expenses of a given program
are offset by program revenues. Direct expenses are those that are dearly 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.
KIN
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Basis of Presentation — continued
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:
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, fixed charges and capital improvement costs that am 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 -tens 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.
General Obligation Bond Capital Projects Fund -
To account for financing, acquisitions, and construction of improvements to City facilities and
infrastructure not accounted for by other bond funds.
37
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
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 accounfing objectives am 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:
Enterprise Funds:
Water and Sewer Fund -
The Water and Sewer Fund is used to account for the provision of water and sewer services to the
residents of the City. Activities for the fund include administration, operations and maintenance of
the water and sewer system and billing and collection activities. The fund also accounts for the
accumulation of resources for, and the payment of, long-term debt principal and interest for water
and sewer debt. All costs are financed through charges to utility customers with rates reviewed
regularty and adjusted if necessary to ensure integrity of the fund.
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.
Golf Course Fund -
The Golf Course Fund is used to account for activities associated with the operations of the Chase
Oaks Golf Course purchased by the City in October 2004.
Internal Service Funds:
Replacement Fund -
The Replacement Fund is an internal service fund that accounts for the rusts associated with the
acquisition and replacement of vehicles, machinery, and equipment through the rental of such
items to other departments.
Risk Management Fund -
The Risk Management Fund accounts for the costs associated workers compensation, liability and
property insurance and medical and dental programs established for City employees and their
covered dependents.
Kkl
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -CONTINUED
Basis of Presentation - continued
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 noncurrent) are
included on the statement of net assets and the operating statements present increases (revenues)
and decreases (expenses) in total net 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 liabilities are incurred.
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 measurable and available. "Measurable means the amount of the transaction can
be determined and "available' means collectible within the cement 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.
The revenues susceptible to accrual are property and sales taxes, franchise taxes and interest income.
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 cash 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.
W.
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -CONTINUED
Cash, Cash Equivalents and Investments - continued
For purposes of the statement of rash 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 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 govemmental funds. Under the City's budgetary process, appropriations lapse at fiscal
year end. Encumbrances are reported as reservations of fund balances bemuse they do not
constitute expenditures or liabilities.
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 2006 levy was based is
$5,719,244,070. 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 rate to finance general
governmental services including the payment of principal and Interest on long-term debt for the year
ended September 30, 2007 was $0.558 par $100 of assessed valuation. In Texas, countywide mntral
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 three 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, if 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 pefition for an election to determine whether to limit the tax rate to no
more than 8% above the tax rate of the previous year.
40
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30.2007
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES— CONTINUED
Interfund Receivables and Payables
Activities between funds that are representative of lending/borrowing arrangements outstanding at the
end of the fiscal year are reported as "due tolfrom other funds'. Any residual balances outstanding
between the governmental activities and business -type activities are reported in the govemment-wide
financial statements as *internal balances'.
Transactions Between Funds and Between Funds and Component Units
Intertund services provided and used 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 expenditurestexpenses in the reimbursing
fund and as a reduction of expenditures/expenses in the fund reimbursed. All other interfund
transactions, except transactions between the component units and the primary government are
recorded as transfers.
Transactions between the component units and the primary government are accounted for as external
transactions (revenues and expenses). During the fiscal year ended September 30, 2007, ACDC
contributed $72,000 to the General Fund and $60,000 to the Park and Recreation Special Revenue
Fund and AEDC contributed $68,500 to the General Fund. These revenues were reflected as grants
and contributions for the primary government in the government -wide statement of activifies.
Inventories and Prepaid Items
Inventories, which are expanded when consumed, are recorded using the average cost method, and
are valued at cost.
Prepaid items are for payments made by the City in the current year to provide services occurring in
the subsequent fiscal year. A reserve for prepaid items is recognized in the governmental funds in the
fund level financial statements to signify that a portion of fund balance is not available for other
subsequent expenditures.
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).
41
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES —CONTINUED
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 costa 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 have an original cost of $5,000 or more and over one year of useful fife.
Depreciation has been calculated on each Gass 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 filum
5 Years
Other improvements
2 - 30 Years
The City has established the Replacement Fund to account for the replacement of the Cl"ned
vehicle, machinery, and equipment. Charges for use In the forth of user payments are made by City
departments to the Replacement Fund to provide for future acquisitions and replacements.
Compensated Absences
City employees eam vacation and sick leave, which may either be taken or accumulated, up to certain
amounts, until paid upon retirement a termination. Upon termination a retirement, an employee is
reimbursed up to a maximum number of hours of vacation pay and sick leave based upon the years of
service. Accumulated vacation and sick leave is accrued when incurred in the government -wide,
proprietary, and fiduciary fund financial statements.
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 a through
external restrictions imposed by creditors, grantors or laws or regulations of other governments.
42
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30.2007
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,
2007, with collateral required by state statutes. At year-end, the carrying amount of the City's deposits was
$1,609,784 and the bank balance was $2,803,731. 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, 2007 was $9,800.
The carrying amount of deposits for ACDC and AEDC, discretely presented component units, were $9,474
and $2,546, 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. 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. Texpcol 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. Govemment agencies, commercial paper and other safe
Instruments. The investment in Texpool and any accrued interest may be redeemed at the City's
discretion. The Citys position in the pool is not materially different from the value of the pool shares.
The table below identifies the investment types that are authorized for the City by the Public Funds
Investment Act. (Government Code Chapter 2256). The table also identifies certain provisions of the City's
investment policy that address interest rate risk, credit risk, and concentration of credit risk.
43
Maximum
Maximum
Authorized
Maximum
Percentage
Investment
Investment Type
Maturity
ofPortfolio
In One Issuer
Certificates of Deposit
5 years
30%
None
Repurchase Agreements
5 years
30%
None
U. S. Treasure Obligations
5 years
100%
None
Municipal Investment Pool
5years
100%
None
Commercial Bank Savings Account
5years
15%
None
U. S. Govemment Securities (non -callable)
5 years
100%
None
U. S. Government Securities (callable)
5 years
70%
None
U. S. Government Sponsored Corp.
5 years
75%
None
Instruments: non -callable
U. S. Government Sponsored Corp.
5 years
70%
None
Instruments: callable
Commercial Paper
5 years
20%
None
Bankers Acceptance
5 years
10%
None
Guaranteed Investment Contracts
5 years
25%
None
State or Local Governmental Obligations
5years
30%
None
43
CRY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30,2007
NOTE 2. DEPOSITS, INVESTMENTS AND INVESTMENT POLICIES - CONTINUED
Disclosures relating to interest rate risk
Interest rate risk is the dsk that changes in market interest rates will adversely affect the fair value of an
investment. Investments with interest rates that are fixed for longer periods of time are more likely to
be subject to increased variability In their fair values due to changes in the market interest rates. The
City manages its exposure to market price changes by avoiding over -concentration of assets in a
specific maturity sector, limitation of average maturity of operating funds investments to less than
eighteen months, and avoidance of over -concentration of assets in specific instruments other than U.S.
Treasury Securities and authorized investment pools.
As of September 30, 2007, the City had the following investments:
Fair Value Weighted
Investment Primary Avg. Maturity
Type Government AEDC ACDC Total, (Years)
FFC $ 2,468,750 $ $ $ 2,468,750 1.46
Commercial Paper 16,527,693 16,527,693 .45
FHLB 6,029,872 487,569 800,587 7,318,028 .61
FNMA 7,089,340 574,635 943;549 8,607,524 .40
FHLMC 4,149,586 679,115 1,115,103 5,943,804 .56
Certificates of Deposit 2,000,000 2,000,000 .02
Texpool 36.442.478 853.510 8.512.756 43.808.744 .003
Total S 74.707.719 $ 2.594.829 , S 8(3.874.543
Disclosures relating to credit risk
Credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the
investment. This type of risk is typically expressed in terms of the credit ratings issued by a nationally
recognized statistical rating organization. The City reduces the risk of Issuer default by limiting
investments to those instruments allowed by the Public Funds Investment Act, Chapter 2256, Texas
Government Code. The City's investments in U.S. Agency securities (FHLB, FNMA, FFCB, and
FHLMC) are rated AAA by Standard & Pools and Airs by Moodys Investors Service.
The investment in the Texas Local Government Pool (TexPool) carded a credit rating of AAAm by
Standard & Pools as of September 30, 2007. The City's Investments in commercial paper are rated A-
1. F-1, and P-1 by Moody's Investors Service, Fitch, and Standard & Pools as of September 30, 2007.
44
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30.2007
NOTE 2. DEPOSITS, INVESTMENTS AND INVESTMENT POLICIES - CONTINUED
Concentration of Credit Risk
The City's Investment policy does not contain stipulations regarding the amount of funds that can be
invested in any single issuer. As of September 30, 2007, with the exception of funds invested at
Texpool, the following table represents 5% or more of the City's investments.
Issuer Investment Type Reported Amount Percentage
FHLB Federal agency securities $ 7,318,028 8.44%
FNMA Federal agency securifies $ 8,607,524 9.93%
FHLMC Federal agency securities $ 5,943,804 6.86%
Custodial Credit Risk
The custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial
institution, a government will not be able to recover deposits or will not be able to recover collateral
securities that are in the possession of an outside party.
The custodial credit risk for investments is the risk that, in the event of failure of the counterparty to a
transaction, a government will not be able to recover the value of investment or collateral securities that
are in the possession of an outside parry. The CIVs invesbnent policy does not contain specific policy
or legal requirements that address the potential for custodial credit risk for investments.
The Public Funds Investment Act does require that financial institutions secure deposits made by state
or local governmental bodies by pledging securities in an undivided collateral pool held by a depository
regulated under state law. The market value of the pledged securities of the collateral must always
remain at least equivalent to the bank balance less the FDIC insurance.
As of September 30, 2007, the City's deposits with financial institutions above the federal depository
limits were fully collateralized.
45
CIN OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 3. RECEIVABLES
Receivables at September 30, 2007 for the governments individual major funds and non -major, and
internal service funds in the aggregate, including the applicable allowances for uncollecuble accounts,
consist of the following:
Bales Aamnd
Tues A Urfls IMereat Asseasme0Uev Total
General Fund $517,213 f 1,676,639 f f 103,679 f $1,389.00 $3.6n.571
Debt Servke 255,928 2,048 257,874
FadlNas
Agreement
General Capital
prolents
G.O. Bond Fund
Nomura or
Govenvaental Funds
Water and Sewer
Solid Waste
Drainage
Goff Course
Internal Service
Funds
Gross Receivables 773,891 1,676,639
Less: Allowance for
Unmbwtibles 285
Total Net Recewat4w.
Primary G.rrarent S af] 391 E 1 8]62y9
Component Units
35.664 35.864
I 14.5511 ( 300.2251
E d 599.492 f 3E) 31B E 1a] i5] E 1 892.851 f9 j
f 411.BrYl E 19.135 f f— Sl>68.378
The Water and Sewer Fund accounts receivable include unbilled charges for services rendered through
September 30, 2007.
46
32,812
187,557 22,369
107,932
107,932
179,439
11,080
19,519
4,137,929
68,401
4,206,330
233,619
321,565 555.184
53.942
53.962
6,849
81849
2.285
2_1751
24.018
4,814,073
387,319
187,557' 1,692,651 9,331,280
I 14.5511 ( 300.2251
E d 599.492 f 3E) 31B E 1a] i5] E 1 892.851 f9 j
f 411.BrYl E 19.135 f f— Sl>68.378
The Water and Sewer Fund accounts receivable include unbilled charges for services rendered through
September 30, 2007.
46
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 4. CAPITAL ASSETS
Capital asset activity for the year ended September 30, 2DD7 was as follows:
Governmental Activities
47
Balance
Sales or
saw.
September 30,
Other
Adjustments/
September 30,
2D06
AddiBom
Dispositions
Transfers
2007
Governmental Funds:.
General capital assets
M their, depredated
Land and WW improvements
$98.611,W4
6 4,692,963
S
8
5103.3Wpm
construction in progress
27.591.180
8.428.212
( 25.164.1711
10.835.221
Total capital assets
not 1,eir, depredated
126.202224
13.121.175
( 25.184.1711
114.138.228
General capital assets
being depredated
Buildings
45,583,715
6,647,878
52,231,50
Improvements
other Nan buildings
314,80,086
11,969,466
18,536,20
345,395,845
Fumiture and fuWres
2,846,757
47,956
2,894,713
Vehicles
3,171,545
128,347
( T77,911)
3,021,01
Unny books
2,670,852
10,00
( 58.914)
2,761,838
Machinery and equipment
4.05.827
431.595
( 56.8891
4.30.533
Total capital assets being
depredated
373.168.782
12,727.384
( 393.7141
25.184.171
410.886.03
Less accumulated
depredation for:
Buildings
( 6,899,206)
( 639,223)
( 7,08,429)
Improvements
other than building
( 87,818,598)
( 12,951,882)
( 10,570,480)
Fumiture and fixtures
( 1)07,348)
( 30,10)
( 2,102,547)
Vehides
( 1,659,429)
( 29],163)
257,749
( 1,60,843)
LDmry Books
( 2,222,30)
(' 179,130)
56,913
( 2,342,567)
Machinery and equipment
( 3.1H.34]I
( 834.44])
55.000
( 3.956.]0)
Total accumulated
depredation
( 10.2842]8)
( 15.297.041
371.662
( 118.209.660)
Total general capdal assets
being depredated, net
269.884.50
( 2.569.60)
( 22.052)
25.184.171
20.476.942
General capital assets, net
$ 30.086]28
$ 10.551.495
(S 22.052)
$
S 406.616.171
47
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 4. CAPITAL ASSETS - CONTINUED
Balance
Sales or
Balance
Septgmbar 30.
Other
Adjustments/
September 30,
2006
Addtbns
Olespedip s
Trainees
2007
Internal Service Funds:
Capital ar ats being depreciated
Vehicles
f 3,386,300
f 890,791
(f 203,293)
$
S 3,875,798
Wa eery and equipment
821.431
348.585
( 7001
1.187.326
Total usemal trg arvice
sets bedepredated
4.209.731
1,037.M
( 203 993)
5.043.124
Less arrumuland
depr Wn for
Vehicles
( 1,604.5]4)
( 462,647)
138,139
( 1,829,082)
Machinery and equipment
( 305.765)
( 205632)
( 5113971
Tefal accumulated
depredaWn
( 1,910,3391
( 688.279)
130,139
1 2440479)
Internal servbe funds
capital awls, net
"299.392
S 389.107
(S 65.854)
S
$ 2.802.645
Goremmental adwifies
e 016 e1fi
capital assets, not
- m 3M.120
it 10 alts fine
IS A7906)
S
4r19
Business -Type Activities
Water and Sewer Activities:
Capibl assets not beirg depredated
Land
$ 3,327,730
f 52,905
S
f
f 3,380.635
ConslrucWn in progress
6278.196
6059.058
f 21674821
10169772
Total capibl assets not
being depredated
9805.928
6111.961
( 2187A821
135501W
Capital Assets Being depreciated:
Towers, tank; 8 pumps staWns 118,145.488
4,13$592
2,167,482
122,452,540
Fumikee and fixtures
Machinery and equipment
11,114
2,469,928
488,136
10,029
11,114
2.948,093
Vehicles
725.314
77.625
( 422841
760.655
Total capital assts
being depreciated
119.351.622
4685359
( 322551
2187482
1281]2402
Less acamuli ted
depredat'ufn for
Towers, larks, B pumps sutio n ( 34,314,9]6)
( 3,915,803)
( 38.230,579)
FumlNre and futures
( 7,860)
( 2,224
( 9•W)
1,499,925)
Machinery and aqutpment
Vehicles
( 1,103,188)
( 717.7421
( 388.75/)
( 587221
42280
(
( 734.1841
Total aaumubted
depredation
( 36143.5481
[ 43733081
42.280
1 404]4.5]21
Total capital assals
being depredated, net
83208.276
312.04]
10.025
2.167.462
85097.830
Wafer aM ewer activities
capital assets, net
f 92814.204
$ 6424008
S 10.025
$
S 88208.23]
48
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 4. CAPITAL ASSETS • CONTINUED
Salana, Salesor Balance
SapOembs30, Other AdjustmenW September 30,
2006 Additions Dispositions Transfers 2007
Solid Waste Activities.
Capital assets being depreciated
Machinery and equipment
$ 9,819
S
E S
$ 9,819
Vehicles
*1.448
44.448
Total capital assets
twang deprecated
54.267
54.267
Lass accumulated
deprecation for:
Machinery aid equipment
( 5,017)
( 1,219)
( 6,236)
Vehicles
( 36.2181
( 8.230)
1 *1.6481
Total accumulated
depredation
( 41235)
( 9.*191
( 50.8841
Sold Veale activities
capital assets, net
$ 13.32
($ 9.4491
$ $
$ 3.583
Drainage Activities:
Capital assets being deprecated
011ier improvements
$ 498,132
f
$ $
S 498,132
Vehicles
406,809
( 4,730)
102,0]9
Machinery and equipment
373734
373.739
Total capital assets
betrg deprecated
976.615
( 4.7301
971.915
Less accumulated
depredation nor:
Other impmvemenls
( 42,280)
( 11,941)
( 54,221)
Vehicles
( 84,845)
( 4,308)
4,730
( 84,423)
Machinery and equipment
f 230811)
( 31.0771
( 281.888)
Total accumulated
deprecation
L 357.9361
( 47.3261
4.730
( 400.532)
Drainage activities
capital assets, net
$ 6187
($ 47.328)
f $
$ 5]1.413
Golf Course Activities:
Capital assets being depreciated
Machinery and equlpment
S 296.790
$ 12,718
$ $
S 3091508
Fenit re add f lures
10.894
10 894
Total opital assets
being depreciated
296.780
23.612
320.402
Less accumulated
depreciation for.
Machinery add! equipment
( 175210)
( 71,649)
( 246,859)
FumlWre add futures
f 1
( 1.0891
( 1089)
Total accumulated
deprecation
( 175210)
( 72.738)
( 247.948)
Golf course activities
capital assets, net
S 121.580
($ 49.128)
S $
$ 72.45
Bualdess-type acliviees
capital assets, net
f 9A•Sa] 455
$ R 31fl 1n]
jj�0.M5MS $
$ ae R45 fifl]
49
CITY OF ALLEN, TERAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30.2007
NOTE4. CAPITAL ASSETS—CONTINUED
Balance
Saks or
Baknce
September 30,
Other
AEjustrnentd Seplemkr 30,
2006 Additions
DLsoosiions
Tranaism 2007
Component Units
Capital assets col king tlepretletetl:
Land $ 4,324,525 $10,852,659
($ 7,792,579)
$ $ 7,384,805
Land improvemerds 207.278
207.276
Total capital assets
not beiig depradak $ 4.531.803 $10.852.659
($ 7.792.5!91
$ $ 7.591.883
Capital assets berg depredated:
Improvements other
Nan buildings 3,129,289
3,129,289
FumBure and fixtures 74.028
74.028
Total capital assets being
depredated 3.203.317
3.203.317
leu a.rnnda ed
depreciation for:
Buikings 1 1,108,578) ( 153,333)
( 1,259,909)
Furn ure and fixtures 1 83.6381 9.608
( 74.028)
Total emumulatetl
EepredaWn ".190.212) ( 1437251
( 1.333.937)
Total capital assete
being depreciated. net 2.013.105 1_ 143]25)
1.889.380
Component unus
capital assets, net E 8 V4.GW S 1R7aBg34
($ ] 792579)
E
Depreciation expense was charged as direct expense to programs of the
primary government as follows:
Governmental activities:
General government
$ 810,611
Public safety
827,093
Public works
9,929,012
Culture and recreation
3,680,231
Community development
17,870
Grant Administration
32.227
Total depreciation expense - General capital assets
15,297,044
Internal Service Funds
668.279
Total depreciation expense -Governmental activities
315.985.323
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 4. CAPITAL ASSETS - CONTINUED
Business -type activities:
Water and sewer
Solid waste
Drainage utility
Golf course
Total depreciation expense - Business -type activities
Component units:
Allen Economic Development Corporation
$ 4,373,306
9,449
47,326
72.738
$ 4.502.819
Outstanding commitments at September 30, 2007, under authorized construction contracts were
$3,533,154. 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, 2007, bonds payable consisted of the following individual issues:
General Obligation Bonds:
Govemmental Business -Noe
$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%. $ 475,000 $
$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%.
1,230,000
$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%.
1,480,000
$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%.
7,810,000
$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%.
11,045,000
$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%. $
6,240,000
51
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTES. LONG-TERM DEBT—CONTINUED
General Obligation Bonds - continued:
Governmental Business -type
$11,700,000 Series 2004 Bonds due in annual installments
of $395,DD0 to $790,000 through September 1, 2024;
interest at 4.0% to 5.25%.
10,640,000
$32,330,000 Series 2005 Refunding Bonds due in annual
installments of $75,000 to $3,505,000 through August 15,
2021; interest at 3.0% to 5.00%.
31,700,000
$1,595,000 Series 2006 Bonds due in annual installments
of $50,000 to $1.15,000 through August 15, 2026;
interest at 4.0% to 4.20%.
1,545,000
$11,145,000 Series 2007 Bonds due In annual installments
of $3110,000 to $815,0D0 through August 15, 2027;
interest at 4.0% to 5.00%.
11.145.000
$ 6mllm $
Certificates of Obligation
$4,735,000 Series 2004A Combination Tax & Revenue
Golf Course Certificates of Obligation due in annual
installments of $165,000 to $390,000 through
September 1, 2024; interest at 3.50% to 5.00%. $ 4,570,000 $
$765,000 Series 2004B Combination Tax S Revenue
Golf Course Certificates of Obligation due in annual
installments of $25,000 to $70,000 through
September 1, 2024:mterest at 4.875% to 5.50%. 740,000
ACDC Sales Tax Revenue Bonds
$5,350,000 Series 1997 Sales Tax Revenue Bonds
due in annual installments of $125,000 to $435,000
through September 1, 2017; interest at 4.625% to 6.625%. $ 260,000 $
$5,125,000 Series 1999 Sales Tax Revenue Bonds
due in annual installments of $55,000 to $400,000
through September 1, 2019; interest at 4.5% to 6.0%. 1,295,000
$5,600,000 Series 2006 Refunding Bonds due in
annual installments of $290,000 to $785,000 through
September 1, 2019; interest at 3.75% to 5.0%. 5.600.000
$ 7.155.000 $
52
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 5. LONG-TERM DEBT - CONTINUED
Water and Sewer Revenue Bonds:
Governmental Business -Noe
$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 5.0%. $ $ 7,125,D00
$6,710,000 Series 2004 Bonds due in annual Installments
of $175,000 to $490,000 through June 1, 2024; Interest
at 4.75% to 5.0%. 5,490,000
$4,300,000 Series 2005 Bands due in annual installments
of $140,000 to $310,000 through June 1, 2025; interest
at 3.75% to 6.625%. 3.995.000
$ $ 16.610.000
The following is a summary of long-term debt transactions, including current portion, of the City for the year
ended September 30, 2007:
Balance Balance Due
Beginning End Whin
of Year Increases Decreases of Year One Year
Governmental Activities
General Obligation Bonds
Certificates of Obligation
Capital lease payable
Compensated absences
Less deferred amounts:
For issuance premiums
For refundings
Governmental activity
Long-temtdebt
$ 78,300,000
$11,145,000 ( $6,135,000)
$ 83,310,000
$ 4,575,000
5,500,000
( 190,000)
5,310,000
200,000
144,197
( 67,925)
76,272
57,698
2,696,685
387,663 ( 134,834)
2,949,513
1,786,368
1,557,416
( 20,604)
1,536,812
( 1.357.0351
158.316
( 1.198.719)
53
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTES. LONG-TERM DEBT—CONTINUED
Balance Balance Due
Beginning End Whin
of Year Increases Decreases of Year One Year
Business Type Activities
Water and Sewer Revenue Bonds
$ 18,190,000 $
($1,580.000)
$ 16,610,000
$ 1,575,000
Compensated absences
231,346
84,912 ( 58,950)
257,308
195,234
Capital lease payable
139,916
( 88,713)
51,203
36,063
Less deferred amounts:
For refundings
( 82,282)
4,636
( 77,646)
For issuance discounts I premiums
( 4.2821
3.135
( 1.147)
Business -type activity
Long4avo debt
$ 111d]d 848 $
86912 ($1]198921
$160.49 ]1A
$ 1611629]
Component Units
Sales Tax Revenue Bonds
$ 7,625,000 $
($470,000)
$ 7,155,000
$ 495,000
Less defamed amounts:
For issuance premiums
177,910
( 13,179)
164,731
For refundings
f 139.498)
8.208
( 131.292)
Component units
Long-term debt
Annual Requirements to Retire Debt Obligations
The City intends to retire all of Its general long-term liabilities, plus accrued interest, from ad valorem teres
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. The annual aggregate maturities for each bond
type for the years subsequent to September 30, 2007, are as follows:
General Oblioadon Bonds
Annual debt service requirements to maturity for geneml obligation bonds, including interest of $32,978,298
are as follows:
Govemmental Activi5es
Fiscal Year Ending
September 30 Principal Interest Total
2008 4,575,000 3,785,483 8,360,483
2009 4,745,000 3,587,506 8,332,506
2010 4,960,000 3,389,960 8,349,960
2011 5,180,000 3,188,566 8,368,566
2012 5,435,000 2,978,034 8,413,034
2013-2017 29,515,000 10,926,242 40,441,242
2018-2022 22,540,000 4,363,842 26,903,842
2023-2027 6.360.000 758.665 7118.665
Total $ 83 310.000 $ 32.978.298116$ 28629$
54
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTES. LONG-TERM DEBT -CONTINUED
Certificates of Obligation
Annual debt service requirements to maturity for the Certificates of Obligation, Including interest of
$2,391,918 are as follows:
Sales Tar and Revenue Bonds
Sales Tax Revenue bond debt service requirements to maturity, including interest of $2,060,745 are as
follows:
Governmental Activities
Fiscal Year Ending
September 30
Principal
Interest
Total
2008
$ 200,000
233,825 -
433,825
2009
205,000
223,700
428,700
2010
220,000
213,325
433,325
2011
230,000
202,175
432,175
2012
240,000
190,525
430,525
2013-2017
1.440,000
798,500
2,238,500
2018-2022
1,875,000
466,805
2,341,805
2023 - 2024
900.000
63.063
963.083
Total
$ 5.310.000
S 2391 V18
$ 7.701.918
Water and Sewer Revenue
Bonds
Revenue bond debt service requirements
to maturity,
including interest of $6,109,026 are as follows:
Business-troe Activities
Fiscal Year Ending
September 30
Princioal
Interest
Total
2008
1,575,000
789,358
2,364,358
2009
1,035,000
709,407
1,744,407
2010
1,085,000
659,089
1,744,089
2011
1,145,000
605,277
1,750,277
2012
1,200,000
549,221
1,749,221
2013-2D17
5,540,000
1,928,901
7,468,901
2018-2022
3,630,000
749,269
4,379,269
2023-2025
1.400.ODD
118.504
1.518.504
Total
$ 168100011
$
$ 22.719.026
Sales Tar and Revenue Bonds
Sales Tax Revenue bond debt service requirements to maturity, including interest of $2,060,745 are as
follows:
55
Governmental Activities
Fiscal Year Ending
September 30
Principal
Interest
Total
2008
495,000
318,305
813,305
2009
535,000
291,985
826,985
2010
570,000
266,410
836,410
2011
590,000
243,085
833,085
2012
625,000
218,935
843,935
2013-2017
3,580,000
670,275
4,250,275
2018-2019
760.000
51.750
811.750
Total
$ ] 155 000
2.060.]0.5
$ 9 215 745
55
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTES. LONGTERM DEBT—CONTINUED
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, $11,145,000 of general obligation bonds were issued
to finance permanent public improvements and public purposes. 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 $1,399,985 available to service the general
obligation debt at September 30, 2007. 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, 2007.
A schedule of authorized but unissued direct General Obligation Bonds as of September 30, 2007, is as
follows:
Dak of
M t
Pmvbusly
2007
T.hg Bodv AUMgtraBon
Purpose
Avi ached
Issued
Issue
Unissued
City of Nen 06-12-99
Fire G4n 8 Equip
$ 4,900,000
S 3,755,000
$ 1,135,000
$
0612-99
sheets
20,500,000
20,309,500
190.500
0612-99
Parks
22,000,000
21,349,000
401,000
250,000
11-05-02
Perkwft Ms Center
19,500,000
2,755,500
28,500
15,585,000
0512-07
Service Cntr Facikees
14,500,000
14,500,000
0512417
Munidpal %Wi Bidgs
1,700,000
1,700,000
05-12-07
stn eft
27,200,000
2,840.=
24,380.000
0512-07
Parks
17,250,000
4,150,000
13,100,000
0512-07
Public Arts Pmlects
1,390,000
200,000
1,190,000
0512-0]
Public Safety
15.855.000
2.200.000
13.655.000
Total $1440.]85.889
d5
$ t1.145.09a
en544a 000
6*11
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTES. LONG-TERM DEBT—CONTINUED
Wafer and Sewer 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 $336,842 at September 30, 2007 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 are payable solely from and, equally secured by,
a first lien on and pledge of the net revenue of the City's combined waterworks and sanitary sewer
systems.
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 accumulate 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, 2007 of $2,174,961 are adequate to meet the reserve requirements.
At September 30, 2007, restricted assets, which include Water and Sewer Revenue Bond Debt Service
and Reserve Funds, were as follows:
Revenue bond debt service $ 1,359,811
Revenue bond reserve fund 815.150
Retained earnings reserved for Water and Sewer revenue bond retirement is detailed as follows:
Restricted assets, revenue bond debt
Service and reserve funds $ 2,174,961
Accrued interest, payable from restricted assets ( 263,119)
Current maturities of revenue bonds,
payable from restricted assets ( 1,575.0001
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, 2007 was 3.32 times.
57
CITY OF ALLEN, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
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, 2007, the capitalized costs of the Governmental leased
property and Business -type leased property under capital leases were $632,755 and $296,790,
respectively.
The terms of the leases range trom 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, 2007 are as follows:
Operatlna Leases
The City leases machinery and equipment under noncancelable operating leases. Total costs for such
leases were $70,768 for the fiscal year ended September 30, 2007. Future minimum lease payments, by
year and in the aggregate, under the non -cancelable lease commitments are as follows:
Fiscal Year Ending
September 30, Amount
2008 $ 70,073
2009 92,884
Total $ 162,957
on
Governmental Activities
Fiscal Year Ending
September 30.
Principal
Interest
Total
2008
57,698
2,662
60.360
2009
12,622
760
13,382
2010
- 3,893
343
4,236
2011
2.059
59
2.118
Total
Trx
Business -type Activities
Fiscal Year Ending
September30.
Principal
Interest
Total
2008
36,063
1,491
37,554
2009
9,954
584
10,538
2010
5.186
83
5.289
Total
L—.§=
$ 2.158
$S
Operatlna Leases
The City leases machinery and equipment under noncancelable operating leases. Total costs for such
leases were $70,768 for the fiscal year ended September 30, 2007. Future minimum lease payments, by
year and in the aggregate, under the non -cancelable lease commitments are as follows:
Fiscal Year Ending
September 30, Amount
2008 $ 70,073
2009 92,884
Total $ 162,957
on
CITY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 6. 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 2007 were as follows:
Fund
Transfers In
Transfers Out
Major Governmental Funds:
General Fund
$ 2,639,250
$ 801,010
Non -Bond Capital Projects
2.068.362
1.379.000
Total Major Governmental Funds
4.707.612
2.180.010
Non -major Govemmental Funds:
Street Improvement
1,152
Antenna Rental Fund
175,000
Parks & Recreation Special Revenue
175,000
150,000
Park Improvement
67,710
Grants & Special Revenue
195.183
Total Non -major Govemmental Funds
370,183
387.862
Major Enterprise Funds
Water and Sewer Fund
1,495,645
4,540,175
Solid Waste Fund
74,135
Drainage Utility Fund
170,575
Golf Course Fund
570.652
Total Major Enterprise Funds
$ 2.066.297
$ 4.784.885
Internal Service Funds:
Risk Management Fund
$ 208.665
Total Internal Service Funds
208.665
Total Transfers
$ 7.352.757
E 7.352.757
Transfers are used to 1) move amounts from funds receiving administrative and operating support to the
appropriate fund incurring the administrative and operating costs and 2) to move unrestricted funds to
finance various programs that the City must account for in other funds in accordance with budgetary
authorizations, including amounts provided as subsidies or matching funds for various grant programs and
to support cash financing of capital projects.
The fund financial statements show:
• Governmental funds: Total transfers in of $5,077,795 include funding for capital projects, grant
matching funds, and reimbursement for operating and administrafive costs Incurred to provide
technology, procurement, human resources, building maintenance, financial and administrative
support. Transfers out totaling $2,567,872 include cash financing of capital projects, support of
programs recorded in non -major governmental funds and internal service funds.
59
CITY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 6. INTERFUND TRANSFERS - CONTINUED
Proprietary funds: Total transfers in of $2,066,297 mainly represent amounts transferred into the
Golf Course to support operations. The total transfer out of $4,784,885 represents the amount
provided by other funds for technology, procurement, human resources, building maintenance,
financial and administrative support. The Internal Service Funds total transfer in of $208,665 mainly
represents the amounts needed for administrative support of the Risk Management fund.
NOTE 7. RETIREMENT PLAN
Plan Descrlptlon
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 811 currently administered by TMRS, an agent multiple -employer public employee retirement
system. Each of the 811 municipalities has an annual, individual actuarial valuation performed. All
assumptions for the December 31, 2006 valuations are contained in the 2005 TMRS Comprehensive
Annual Financial Report. A copy of that report can be obtained by writing to: Texas Municipal Retirement
System, P.O. Box 149163, Austin, Texas 78714-9153.
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 at least 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 percentage (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 O the current
employee contribution rate and City matching percent had always been in existence and O the
employee's salary had always been the average of his salary in the last three years that are one year
before the effective date. At retirement, the benefit is calculated as if the sum of the employee's
accumulated contributions with interest and the employer -financed monetary credits with interest were
used to purchase an annuity. The plan provisions are adopted by the governing body of the City, within
the options available in the state statutes governing TMRS. Plan provisions for the City were as follows
(as of 4/04/07):
Deposit Rate: 7%
Matching Ratio (City to Employee): 2 to 1
A member is vested after 5 years
Members can refire at certain ages, based on the years of service with the City. The Service Retirement
Eligibili ies for the City are: 5 yearslage 60; 20 years/any age.
Contributions and Funding Policy
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 service contribution rate, both of which are
calculated to be a level percent of payroll from year to year. The normal cost contribution rate finances
the currently accruing monetary credits due to the City matching percent, which are the obligabon of the
City as of an employee's refirement date, not at the time the employee's contributions are made. The
M
CITY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 7. RETIREMENT PLAN - CONTINUED
normal cost contribution rate is the actuarially determined percent of payroll necessary to satisfy the
obligation of the City to each employee at the time his/her retirement becomes effective. The poor
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 serves as the basis for the rate and the calendar year when
the rate goes into effect. (i.e. December 31, 2006 valuation is effective for rates beginning January
2008).
Contributions and Fundina Policy
Contributions by the City were $2,519,314 or 10.9% of the covered payroll of $25,875,248 as required by
the actuarial valuation. Annual City TMRS pension cost and related information for the last three years is
as follows:
Annual Pension
Fiscal Year Cost (APC)
2005 $2,307,968
2006 2,570,900
2007 2,519,314
Percentage of Net Pension
APC Contributed Obligation
100% 0
100% 0
100% 0
Actuarial Assumotions
Actuarial Cost Method —
Unit Credit
Amortization Method —
Level Percent of Payroll
Remaining Amortization Period —
25 Years — Open Period
Asset Valuation Method —
Amortized Cost
Investment Rate of Return —
7%
Projected Salary increases —
None
Includes Inflation At —
3.5%
Cost -of -Living Adjustments —
None
Schedule of Funding
Progress
Actuarial Valuation Date
2006
2005
2004
2003
2002
Actuarial value of assets
$39,700,887
$3(749,259
$30,154,132
$28,378,242
$23,100,250
Actuarial accrued liability
47,412,499
41,257,545
38,4511,050
33,315,148
28,115,558
Percentage funded
83.73%
84.2%
0%
79 %
62 %
Unfunded (Over -funded) Actuarial
Accrued Liability (URAL)
7,711,812
6,508,288
8,298,918
6,938,904
5,015,408
Annual covered payroll
25,875,246
23,580,572
21,251,288
18,963,358
17,651,515
UAAL as a percentage of
covered payroll
29.8%
27.6%
30 %
37%
28%
61
CIT/ OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
Additional Information
At its December 8, 2007 meeting, the TMRS Board of Trustees adopted actuarial assumptions to be
used in the actuarial valuation for the year ended December 31, 2007. A summary of the actuarial
assumptions and definitions can be found in the December 31, 2007 TMRS Comprehensive Annual
Financial Report (CAFR).
Since its inception, TMRS has used the traditional Unit Credit actuarial funding method. This method
accounts for liability accrued as of the valuations date but does not project the potential fixture liability of
provisions adopted by a city. Two-thirds of the cities participating in TMRS have adopted the Updated
Service Credit and Annuity Increases provisions on an annually repeating basis. These provisions are
considered to be 'committed' benefits (or likely to be guaranteed); as such, the TMRS Board has
adopted the Projected Unit Credit (PUC) actuarial funding method, which facilitates advance funding for
future updated service credits and annuity increases that are adopted on an annually repeating basis.
For the December 31, 2007 valuation, the TMRS Board determined that the PUC method will be used.
In addition, the Board also adopted a change in the amortization period from a 25 -year "open' to a 25 -
year 'closed" period. TMRS Board of Trustee rules provide that, whenever a change in actuarial
assumptions or methods results in a contribution rate increase in an amount greater than 0.5%, the
amortization period may be increased up to 30 years, unless a city requests that the period remain at 25
years. For dues with repeating features, these changes will likely result initially In higher required
contributions and ktwer funded ratios. To assist in this transition to higher rates, the Board also approved
an eight-year phasein period, which will allow cities the opportunity to increase their contributions
gradually (approximately 12.5% each year) to their full rate (or their required contribution rate).
Using demographic data from the 12/31/06 valuation, TMRS' actuary has made calwlations with the new
actuarial assumptions. For cities with annually repeating benefits, those wlwiations resulted in
estimated higher contribution rates, increased unfunded actuarial liabilities, and lower funded ratios.
As of January 2008, The City elected to fund an additional 1% of the estimated payroll to reduce the
unfunded liability.
NOTES. WATER AND SEWER CONTRACTS
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, 2007, the cost of water purchased under this
contract was $5,700,024.
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 2007, the cost for transportation, treatment and disposal of sewage and other wastes
was $4,130,515.
62
CRY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE 9. 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 City's general creditors. As a result at September 30, 2007, the deferred
compensation investments are not reported in the City's financial statements.
NOTE 10. RISK MANAGEMENT
Health and Dental Insurance
The City provides health and dental insurance benefits to City employees under a modified self-insurance
plan. Under the plan, the City and the employee pay a portion of a predetermined monthly premium, which
is based on the estimated claims cost for the plan and the extent of medical coverage selected by the
employee. To cover annual costs, premium payments are reported as operating revenues of the Risk
Management Fund and operating expenditureslexpenses of the participating funds.
A commercial insurance carrier Is utilized to adjudicate and pay medical claims on behalf of the City. The
City's liability is limited by an excess ("stop loss") insurance policy covering individual claims in excess of
$100,000 per person. Throughout the policy year, the "stop loss" insurance carrier reimburses the City for
claims paid during the policy year which exceeded the "stop loss amount. A commercial insurance
company re -insures the City for individual claims in excess of up to a lifetime maximum of $2,000.000.
The liabilities for insurance claims reported are based on GASB No. 10, Accounting and Financial
Reporting for Risk Financing and Related Insurance Issues, which requires that a liability for claims be
reported if information prior to the issuance of the financial statements indicates that it is probable that a
liability has been incurred at the date of the financial statements and the amount of the loss can be
reasonably estimated. These liabilities include an estimate for Inured but not reported claims. The
estimated amount at September 30, 2007 was $617,301.
Changes in the Risk Management liability during the past five fiscal years were as follows:
Current Year
Balance at Claims and Balance at
Year Ending Beginning of Changes in Claim End of
September 30, Fiscal Year Estimates Payments Fiscal Year
2003 $ 303,246 $ 3,011,365 $ 2,952,591 $ 362,020
2004 362,020 3,827,089 3,764,493 424,616
2005 424,616 4,506,755 4,404,086 -527,285
2006 527,285 4,347,042 4,359,308 515,021
2007 515,021 6,056,992 5,954,712 617,301
)ci
CITY OF ALLEN, TEXAS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2007
NOTE10. RISK MANAGEMENT -CONTINUED
Postemolovment Benefits
The City provides post -employment health care benefits to all employees who retire from the City at any
age with 20 years of service. The benefit provided by the City consists of participation in the City's health
insurance plan at the same cost as an employee until age 65. Premiums are equal to COBRA rates and
are paid entirely by the retired employee. Currently only two refirees are covered by these benefits. During
fiscal year 2006-2007, refiree claims were $3,847 less than premiums collected. Revenues and
expenditures are included in the Risk Management Fund.
During fiscal year 2006-2007 the Government Accounting Standard Board implemented Statement 45,
Accounting and Financial Reporting by Employers for Post -employment Benefits Other Than Pensions
which requires the City to report, for the first time, annual post employment benefit costs and the unfunded
actuarial accrued liabilities for past service costs. An actuarial valuation of the post-refirement medical and
dental insurance program for the City of Allen was completed as of August 31, 2005 to provide the basis of
implementing GASB 45 in fiscal year 2007-2008. The actuarial study Indicated a $240,657 liability of which
the City has elected to make $40,068 annual contributions to fund the annual required contribution (ARC)
of $8,423 and $31,645 for the normal annual cost for current and future retirees.
Workers Compensation, Property and Liability Insurance
The City participates in the Texas Municipal League Intergovernmental Risk Pool (TMLIRP") for workers'
compensation claims, liability (general, automobile, law enforcement, and emorslomisslons), and property
insurance. The cost is based on the pool's claims cost, which is adjusted to reflect the City's individual
claims experience. As claims arise they are submitted to and paid by TMLIRP. To cover annual costs,
premium payments are reported as operating revenues of the Risk Management Fund and operating
expenditureslexpenses of the participating funds.
The City has a workers' compensation deductible of $25,000 per occurrence, with an annual aggregate
deductible of $400,000. During 2007, the City contributed $534,084 to the Risk Management Fund for
workers' compensation.
The City has various levels of insurance deductibles for property, liability, and automobile insurance with
the maximum deductible set at $10,000. All insured claims are paid by TMLIRP, less the appropriate
deductible. During 2007, the City contributed $488,442 for property and general liability.
NOTE 11. 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 Mese matters will not have a
material adverse effect on the financial condition of the City.
64
CITY OF ALLEN, TEXAS
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
YEAR ENDED SEPTEMBER 30, 2007
NOTE 17. COMMITMENTS AND CONTINGENT LIABILITIES -CONTINUED
Economic Development Grant The City has several economic development agreements whereby It has
agreed to pay a gmngs) to a developer and/or business in return for the design, construction, operating
and/or managing of the business within the City of Allen. All grants are performance based and do not
constitute a liability on the City's financial records.
65
ao,scr • RNreQ
C'rY OF P1•lO-H
REQUIRED SUPPLEMENTARY
INFORMATION
� *a�sP ECT f �NTFC ,
RT
Y
Al q. O�
SP1Nli/l � "m
A
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t C�YY OP A``EN
CITY OF ALLEN, TEXAS
GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
FOR THE YEAR ENDED SEPTEMBER 30, 2007
REVENUES
Ad valorem taxes, penaltes and interest
Franchise taxes
Municipal sales tax
Licenses, penNts and fees
Charge for services
Court fines
Gifts and contributions
Investment earnings
Miscellaneous
EXHIBIT A-1
VARIANCE WITH
BUDGETED AMOUNTS FINAL BUDGET -
POSITIVE
ORIGINAL FINAL ACTUAL (NEGATIVE)
$ 22,779,504 $
23,328,756 $
4,627.190
4,918,286
10,130,630
9,734,954
1,626,000
1,562,500
1,348,619
1,386,228
1,500,001
1,848,900
129,333
135,162
508,000
751,000
51,963
110,771
23,230,344 $
(98,412)
4,888,243
(52,043)
9,756,380
20,426
1,637,556
75,056
1,404,376
18,148
1,727,693
(121,207)
163,844
28,682
969,303
218,303
261,404
150,633
Total revenues
42,701,260
43,776,557
44,016,143
239,586
EXPENDITURES
current
urhent
GenerPublic
10,317,903
10,245,666
9,111,806
1,133,860
safety
Public safely
20,056,714
20,124,611
19,825,653
299,158
Public mft
3,340.534
3,169,112
3,025,105
144,007
Culture and recreation
9,798,554
9,324,196
8,772,497
551,699
Community development
1,964,876
1977,524
1,893,229
84,295
Total expenditures
45,478,581
44,841,309
42,628,290
2,213,019
Excess (deficiency) of revenues
over expenditures
(2,777,321)
(1,064,752)
1,387,853
2,452,605
OTHER FINANCING SOURCES (USES)
Transfers fnxn other funds
2,779,750
2,779,750
2,639,250
(140,500)
Transfers to other funds
(504,877)
(680,116)
(2,180,010)
(1,499,894)
Sale of capital assets
-
33,914
33,917
3
Total other financing sources (uses)
2274,873
2,133,548
493,157
(1,640,391)
NET CHANGE IN FUND BALANCE
(502,448)
1,068,796
1,881,010
812,214
FUND BALANCES, BEGINNING OF YEAR
11,492,233
11,492,233
11,492,233
FUND BALANCES, END OF YEAR
$ 10,989,785
It 12,561,029 $
13,373,243
$ 812,214
i
CITY OF ALLEN, TEXAS
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
YEAR ENDED SEPTEMBER 30, 2007
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 Gty 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 am 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 has 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.
67
COMBINING AND INDIVIDUAL FUND
STATEMENTS AND SCHEDULES
pESPE4T
P�wQ�
it iryi
FSR
C��'Y OF PL�tH
� k
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, certificate of obligation bonds, and Interest from governmental resources.
MAJOR 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.
MAJOR 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 the acquisition and/or construction of capital facilities
and infrastructure, except those financed by proprietary and trust funds and not accounted for by the
other capital project funds. Proceeds from nonrecurring revenue sources are allocated to this fund.
General Obligation Band Fund — To account for bond proceeds used for financing, acquisitions, and
construction of improvements to City facilities and infrastructure not accounted for by other bond funds.
Proceeds from the sale of general obligation bonds provide financing for this fund.
N
CITY OF ALLEN, TEXAS
GENERALFUND
COMPARATIVE BALANCF,SHEETS
SEPTEMBER 30, 2007 AND 2006
ASSETS
Cash and cash equivalents
Investments
Receivables:
Ad valorem takes (net of allowances for uncollectibles
of $176,292 in 2007 and $220,791 in 2006)
Sales fazes
Accrued interest
Other
Prepaid items
TOTAL ASSETS
LIABILITIES AND FUND BALANCE
LIABILITIES
Accounts payable
Accrued liabilities
Due to other funds
Defemed revenue
TOTAL LIABILITIES
FUND BALANCES
Reserved for prepaid items
Unreserved, undesignated
TOTAL FUND BALANCES
TOTAL LIABILITIES AND FUND BALANCE
69
EXHIBIT B-1
2007 2006
$ 947,111 $
5,764,836
12,269,447
6,169,000
340,921
508,305
1,676,639
1,625,234
109,679
25,158
1,369,040
1,364,218
1,250
1,250
$ 16,712,637 $
15,458.003
$ 1,561,406 $
1,308,438
1,437,265
1,239,027
910,000
340,921
508,305
3,339,594
3,965,770
1,250
13,373,243
11,490,983
13,373,243
11 492,233
$ 16,712,837 $
15,458,003
CITY OF ALLEN, TEXAS
EXHIBIT B-2
GENERALFUND
COMPARATIVE STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2007 AND 2006
2007 2006
REVENUES
Ad valorem taxes, penalties and interest
Franchise taxes
Municipal sales tax
Licenses, permits and fees
Charge for services
Court fines
Gifts and contributions
Intergovernmental
Investment earnings
Miscellaneous
Total revenues
EXPENDITURES
Current:
General govemment
Public safety
Public vrorks
Culture and recreation
Community development
Total expenditures
Excess of revenues over expenditures
OTHER FINANCING SOURCE=S AND (USES)
Transfers from other funds
Transfers to other funds
Capital lease obligations
Sale of capital assets
Total other financing sources
NET CHANGE IN FUND BALANCES
FUND BALANCE, BEGINNING OF YEAR
FUND BALANCE, END OF YEAR
70
$ 23,230,344 $
19,727,993
4,866,243
5,520,215
9,755,380
9,230,206
1,637,556
1,732,374
1,404,376
1,447,878
1,727,693
1,506,429
152,018
78,370
11,826
-
969,303
789,876
261,404
498,658
44,016,143
40,531,999
9,111,806
7,293,588
19,825,653
18,124,797
3,025,105
3,257,485
8,772,497
8,750,856
1,893,229
1,723,126
42,626,290
39,149,852
1,387,863
1,382,147
2,639,250
2,339,600
(2,180,010)
(2,111,267)
-
65,944
33,917
380,634
493,157
674,911
1,881,010
2,057,058
11,492,233
9,435,175
$ 13,373,243 $
11.492.233
CITY OF ALLEN, TEXAS
DEBT SERVICE FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2007 AND 2006
ASSETS:
Cash and cash equivalents
Investments
Receivables:
Ad valorem taxes (net of allowances for unoollectibles
of $109,352 in 2007 and $133,428 in 2006)
Accrued interest receivable
Other receivables
Total assets
LIABILITIES AND FUND BALANCES:
LIABILITIES
Interest Payable
Deferred revenue
Total liabilities
FUND BALANCE
Reserved for debt service
TOTAL LIABILITIES AND FUND BALANCE
71
EXHIBIT B-3
2007 2006
$ 1,434,750 $ 183,319
- 1,099,854
146,476 245,110
8,732
2,046 1,806
$ 1,583,272 $ 1,538,821
$ 36,810 $
146,477 245,110
183,287 245,110
1,399,985 1,293,711
$ 1,583,272 $ 1,538,821
CITY OF ALLEN, TEXAS
DEBT SERVICE FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2007 AND 2006
NET CHANGE IN FUND BALANCES 106,274
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
72
EXHIBIT 64
2006
$ 9,600,260
178,792
9,779,052
4,725,670
5,272,002
9,997,672
(218,620)
(218,620)
1,293,711 1,512,331
$ 1,399,985 $ 1,293,711
2007
REVENUES
Ad valorem taxes
$ 9,957,899
Investment earnings
316,837
Total revenues
10,274.736
EXPENDITURES
Principal retirement
6,325,000
Interest and fiscal charges
3,843,462
Total expenditures
10,168,462
Deficiency of revenues over (under) expenditures
106,274
NET CHANGE IN FUND BALANCES 106,274
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
72
EXHIBIT 64
2006
$ 9,600,260
178,792
9,779,052
4,725,670
5,272,002
9,997,672
(218,620)
(218,620)
1,293,711 1,512,331
$ 1,399,985 $ 1,293,711
CITY OF ALLEN, TEXAS
DEBT SERVICE FUND
BUDGETARY COMPARISON SCHEDULE
FOR THE YEAR ENDED SEPTEMBER 30, 2007
EXHIBIT B-5
73
VARIANCE WITH
BUDGETED AMOUNTS
FINALBUDGET
POSITIVE
ORIGINAL
FINAL
ACTUAL
(NEGATIVE)
REVENUES
Ad valorem lazes
$ 9,749,347 $
9,982,214 $
9,957,899 $
(24,315)
Imestment earnings
250,000
240,000
316,837
76,837
Total revenues
9,999,347
10,222,214
10,274,736
52,522
EXPENDITURES
Principal re8rement
6,325,000
6,325,000
6,325,000
-
Intemstand fiscal charges
3,836,117
3,836,117
3,843,462
(7,345)
Total expenditures
10,181,117
10,161,117
10,168,462
(7,345)
NET CHANGE IN FUND BALANCES
(161,770)
61,097
106,274
45,177
FUND BALANCE, BEGINNING OF YEAR
1293,711
1,283,711
1,293,711
FUND BALANCE, END OF YEAR
$ 1,131,841 S
1,354,808 $
1,389,965 $
45,177
73
CITY OF ALLEN, TEXAS
FACILITIES AGREEMENT FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2007 AND 2006
ASSETS
Cash and cash equivalents
Investments
Accrued interest receivable
Total assets
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable
Retainage payable
Deferred revenue
Total liabilities
FUND BALANCES
Reserved for encumbrances
Unreserved, undesignated
Total fund balances
Total liabilities and fund balances
74
EXHIBIT B-6
2007 2006
$ 2,598,795 $ 5,728,521
3,339,310 1,320,499
35,664 10,483
$ 5,973,769 $ 7,059,503
$ 23,887 It 38,134
57,325 21,068
2,723,041 4,173,884
2,804,253 4,233,086
164,712 545,426
3,014,804 2,280,991
3,169,516 2,826,417
$ 5,973,769 $ 7,059,503
CITY OF ALLEN, TEXAS
FACILITIES AGREEMENT FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2007 AND 2006
EXHIBIT B-7
75
2007
2006
REVENUES
Gifts and conhibu0ons
$ 1,527,029 $
448,159
Investment samings
343,099
346,473
Total revenues
1,870,128
794,632
EXPENDITURES
Capital outlay
1,527,029
448,159
Total expenditures
1,527,029
448,159
NET CHANGE IN FUND BALANCES
343,099
346,473
FUND BALANCES, BEGINNING OF YEAR
2,826,417
2,479,944
FUND BALANCES, END OF YEAR
$ 3,169,516 $
2,826,417
75
CITY OF ALLEN, TEXAS
GENERAL CAPITAL PROJECTS FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2007 AND 2006
ASSETS
Cash and cash equivalents
Investments
Accrued interest receivable
Special assessments receivable
Due from other funds
Total assets
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable
Retainage payable
Accrued liabilities
Total liabilities
FUND BALANCES
Reserved for encumbrances
Unreserved, designated
Total fund balances
Total liabilities and fund balances
76
EXHIBIT M
2007 2006
$ 5,670,780 $
3,325,456
3,072,227
3,119,786
32,812
24,768
187,557
187,557
620,000
$ 8,963,376 $
7,477,567
$ 229,328 $ 194,479
121,407 287,112
782,336 622,326
1,133,071 1,103,917
1,784,737 1,449,765
6,045,568 4,923,885
7,830,305 6,373,650
$ 8,963,376 $ 7,477,567
CITY OF ALIEN, TEXAS EXHIBIT B-9
GENERAL CAPITAL PROJECTS FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2007 AND 2006
REVENUES
Charges for services
Intergovernmental
Investment earnings
Miscellaneous
Total revenues
EXPENDITURES
General government
Capital outlay
Total expend8ures
Deficiency of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Transfers from 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
77
2007 2006
$ 770,929 $
593,749
1,359,628
1,882,500
415,860
368,414
721,002
303,098
3,267,219
3,147,761
76,095
143,277
3,802,831
5,707,586
3,678,926
5,850,863
(611,707)
(2,703,102)
2,068,362
1,288,600
(35,000)
2,068,362
1,253,800
1,456,655
(1,449,502)
6,373,650
7,823,152
$ 7,830,305 $
6,373,650
CITY OF ALLEN, TEXAS EXHIBIT B-10
GENERAL OBLIGATION BOND FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2007 AND 2006
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 far encumbrances
Unreserved, undesignated
Total fund balances
Total liabilities and fund balances
i
2007 2006
$ 3,131,576 $
1,782,836
10,105,881
1,528,373
107,932
12,134
$ 13,345,389 $
3,323,343
$ 91,616 $ 5,877
19,051 136,448
110,667 142,325
96,773 2,563
13,137,949 3,178,455
13,234,722 3,181,018
$ 13,345,389 $ 3,323,343
CITY OF ALLEN, TEXAS
GENERAL OBLIGATION BOND FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
SEPTEMBER 30, 2007 AND 2006
EXHIBITB-11
Deficiency of revenues over expenditures
OTHER FINANCING SOURCES
Issuance of debt
Total other financing sources
NET CHANGE IN FUND BALANCES
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
79
(1,091,296) (1,339,972)
11,145,000
2007
2006
REVENUES
11,145,000
1,595,000
Investment earnings
$ 245,817 $
134,262
Miscellaneous
10,138
-
Total revenues
255,955
134,262
EXPENDITURES
General government
1,263,817
918,126
Capital outlay
83,434
556,108
Total expenditures
1,347,251
1,474,234
Deficiency of revenues over expenditures
OTHER FINANCING SOURCES
Issuance of debt
Total other financing sources
NET CHANGE IN FUND BALANCES
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
79
(1,091,296) (1,339,972)
11,145,000
1,595,000
11,145,000
1,595,000
10,053,704
255,028
3,181,018
2,925,990
$ 13,234,722 $
3,181,018
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.
Grants and Special Revenue Fund - To account for monies received from other governmental
agencies that have restricted legal requirements and multi-year budgets.
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 classified as non -major 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.
PEI
CRY OF ALLEN, TEXAS
6 505,23s 3
23,5116 $
305,082 $
NON -MAJOR GOVERNMENTAL FUNDS
-
56,179
-
COMBINING BALANCE SHEET
-
$ 323,027
$ W,414 $
SEPTEMBER 30,2007
429.312 $
479,127
580.414 S
23,586 $
429,342 $
479,127
SPECIAL REVENUE
GRANTS
HOTEL
AND
PARKS
ANTENNA OCCUPANCY
ASSET SPECIAL
AND
RENIN. TAX
FORFEITURE REVENUE
RECREATION
ASSETS
Cash aM rash eeuW"M
Inver wm
Accounts receivable
Acciuee interest
TOTAL ASSETS
LIABILITIES AND FUND BALANCES
LIABILITIES
A me Payable
Ratalnage Payable
Accrued llaNliees
Deferred revenue
TOTAL LNBILITIES
FUND MA CES
ReaeNed 1N en W Tb2(ICGS
Unreserved
TOTAL FUND BALANCES
TOTAL LIABILITIES AND FUND BALANCES
$ 322027
6 505,23s 3
23,5116 $
305,082 $
479.127
-
56,179
-
124,26D
-
$ 323,027
$ W,414 $
23.586 $
429.312 $
479,127
6 - $ 26,118 $ 160 8 64,120 $ 46,798
3,600
2,724 16,671 37,463
62 095 10,463
26,116 2904 146887 94,742'
323,027
534,298
20,882
282.655
384,386
323.027
534.288
20.862
282,655
384.385
$ 323.027 f
580.414 S
23,586 $
429,342 $
479,127
81
EXHIBIT 61
CAPITAL PROJECTS
5,887 15,628 291944
-
61,297
- 28,782
9.879
TOTAL
2,355,898
68,726
4,249,02
NON AJOR
LIBRARY
PARK
STREET
PARK
GOVERNMENTAL
ACQUISITION
DEDICATION
IMPROVEMENTS IMPROVEMENTS
FUNDS
S 282,153 $
1,373,768 $
- $
131,136 $
3.403.092
-
1,037,414
-
-
1,037,414
179,439
11.060
11,030
$ 282,153 $
2,422,260 $
$
131.136 $
4,631,025
$ - $
1,753 $
- $
15,628 $
15,593
-
4,114
-
-
7,914
56,649
72,M
5,887 15,628 291944
-
61,297
- 28,782
9.879
262.153
2,355,898
68,726
4,249,02
262,153
2.416,393
115,508
4,339,61
$ 282.153 $ 2,422.280 $ $ 131.138 S 4.631,25
82
CITY OF ALLEN, TEXAS
NON -MAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED SEPTEMBER 30, 2007
1*1
GRANTS
HOTEL
AND
PARKS
ANTENNA
OCCUPANCY
ASSET
SPECIAL
AND
RENTAL
TAX
FORFEITURE
REVENUE
RECREATION
REVENUES
FmnUiae taxes
$ - $
- $
- $
84765 $
-
U..' pemrits, and fees
402,922
Court fires
-
-
-
166,137
-
HotelImoteltaxes
-
673,383
-
-
-
Reve nfees
-
-
-
-
2,098,051
Gigs and m IribuFiorm
-
-
-
-
181,445
Inter ...ntal
-
-
-
765,592
-
ImesManteamings
12,419
13,662
895
8,353
18,592
Miscellaneous
37,612
1,737
93,832
Tolal revenues
415,341
687,045
38,307
1,06,684
2,392,920
EXPENDITURES
Generel govemmenl
-
-
-
1WAW
-
PUNicsafely
-
-
18,4D4
412,490
-
PuNicmrks
-
-
-
41,309
-
Cultureand .6.
WAD
334.465
-
47,195
2.376.848
Community dowlaprrenl
-
-
-
138,725
-
CaFilal Du6ey
31.782
286.395
-
Total ex mlttums
98,703
334,465
So.188
1,106,808
2,376.848
Excess(defide )ofrevenuesover
expendilums
316,638
352,5W
(11.879)
(100224)
1SA72
OTHER FINANCING SOURCES (USES)
Trensfers fmm o r funds
-
-
-
196,183
175,6000
Tmnsivm W otherfuMs
(175.00D)
-
-
-
(1501000)
Sale Df capital assets
-
IBW7
-
Tatelotherfte drgso s(uces)
(176.000)
16,367
195,183
25,650
NET CHANGE IN FUND BALANCES
141,638
352,5W
4,488
9'959
41,072
FUND BALANCES, BEGINNING OF YEAR
181,350
181,718
16,174
187,696
343.313
FUND BALANCES, END OF YEAR
$ 323,027 $
53'298 $
20,662 $
282,655 $
38'385
1*1
EXHIBIT C-2
13,385 120,590 (757232) (1,090,633) (1,160,603)
_ -
-
CAPITAL PROJECTS
_ (1,152)
(61,710)
(387,862)
16,367
TOTAL
(61,710)
(1,312)
13,385 120,590 (768.384)
(1.152,243)
NON -MAJOR
LIBRARY
PARK
STREET
PARK
GOVERNMENTAL
ACQUISITION
DEDICATION
IMPROVEMENTS
IMPROVEMENTS
FUNDS
$ - 8
6
- $
- f
84,785
-
262,545
-
-
885,467
_
-
-
188.137
-
-
673,383
_
-
-
2,098,051
228
-
-
181,673
_
785,592
13,157
126,941
34,181
59,136
288,138
133.181
13,385
389.486
34,181
59,138
5,038.385
180,884
430.894
-
5,438
-
46.747
-
-
2,857,211
_
_
-
138.725
268.896
795.975
1.149.889
2,632.717
268,896
801,413
1,149,809
8.186.988
13,385 120,590 (757232) (1,090,633) (1,160,603)
_ -
-
370,163
_ (1,152)
(61,710)
(387,862)
16,367
(1,152)
(61,710)
(1,312)
13,385 120,590 (768.384)
(1.152,243)
(1,151,915)
248,768 2,295.803 768,364
1.287,761
5,490,896
$ 262,153 6 2,416.393 9 - 6
115,606
$ 4,3 %Wl
84
0S,FCT * INTpG
CITY OF A�V�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.
Drainage Fund — To account for the provision of developing and maintaining proper drainage services to the
residents of the City.
Golf Course Fund — To account for activities associated with the operations of the Chase Oaks Golf Course
purchased by the City in October 2004.
CT' OF ALLEN, TEAS
WATER AND SEWER ENTERPRISE FUND
COMPARATIVE STATEMENTS OF NET ASSETS
SEPTEMBER 36, 2007 AND 2008
E diff D-1
2007
2008
ASSETS
CURRENT ASSETS
$ 8,970,293 s
10,070,114
Cash mM rash equivalents
6,404,397
9,853,578
Inwmonionts
Remhables, cwt of allowance for moollecONes'.
P at,t
4,123,348
3,331,88
A¢med interest
68.01
54410
Inventories
131,481
141,509
R mctwl cash and cash equivalents
2,174,961
2814,241
Total wrrent easels
21,88,881
28,285,84
NONCURRENT ASSETS
CAPITAL ASSETS
3,380,635
3,327,730
LarM
stat
Towers, tanks, and pump ins
122,452,540
118,145,486
Vehicles
780.055
85,314
Machinery and equipment
2.848.083
2,/89,828
FumiMe am fuWies
11,114
11.114
Comtns8on In Pm9ress
10169.78
6,278198
Total capital assets
139,82,809
128,857,750
Less: accumulated depreciaton
(00474.58)
(38143.548)
Capital assets, net of accvmutated ft aacialian
MA48 237
W1 .204
DEFERREDCNARGES-bondlsmwn wa ,mtofamor07atton
151,632
181,311
Total mnctnent meets
99,389.889
92,975,515
TOTAL ASSETS
121,272,750
119,241339
LIABILITIES AND NET ASSETS
CURRENT UABILITIES
1,516,646
2,075,028
tents P.Plate
509.331
380,938
Acr+ IiabiWles
ft"We from restricted assets:
1,575,000
1,560,000
Revenue burgs Payable - want
Accrued Interest payable
263,119
287,506
Accrued compensated etaences curtent
147,826
124,583
Customer deposits ",tM
1308.983
1,250,151%
Total current liabilities
5,320.887
5678,717
NON -CURRENT LIABILITIES
Revenue WM. pyable
14,956306
18,523,436
A as compensated absences
40.336
49793
Total ncn u ant liabilities
14,906.585
18,5]3329
TOTAL LIABILITIES
20317,452
71351946
NET ASSETS
Invested N coptiM assets, nat of related debt
82,889,025
7].8]8,785
Restricted
Restricted lor revenue bond principal aM interest
336,842
946.656
Umeotrloted
1] 729,431
18,163.852
TOTAL NET ASSETS
5 100,955,298
S 98,988.293
CITY OF ALLEN, TEXAS
EXHIBIT D-2
WATER AND SEWER ENTERPRISE FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
SEPTEMBER 30, 2007 AND 2006
2007
2006
OPERATING REVENUES
Water sales
$ 10,992,395
$ 15,189,548
Sewer charges
7,084,215
6,786,694
Connection fees
241,895
269,051
Service charges
469,517
638,541
Miscellaneous
606,264
47,260
Total operating revenues
19,394,286
22,931 094
OPERATING EXPENSES
Personnel services
2.833.142
2.725,162
Contractual and other services
10,953,668
9,810,399
Maintenance
277,231
212,249
Supplies
123,102
109,319
Depreciation
4,373,306
4,087,222
Other
126,462
127,661
Total operating expenses
18,686,911
17 072,012
OPERATING INCOME
707,375
5,859,082
NON-OPERATING REVENUES (EXPENSES)
Interest income
1,130,430
923,966
Interest expense
(856,339)
(906,632)
Development fees
1,889,477
1,753,041
Total non-operating expense
2163,568
1,770,375
INCOME BEFORE CAPITAL CONTRIBUTIONS
AND TRANSFERS
2,870,943
7,629,457
CAPITAL CONTRIBUTIONS AND TRANSFERS
Capital contributions
4,139,592
6,504,517
Tmnsfers from other funds
1,495,645
10,290
Transfers to other funds
(4,540,175)
(2,182,633)
Total capital conidbutions and transfers
1,095,062
4332,174
CHANGE IN NET ASSETS
3,966,005
11,961,631
NET ASSETS, BEGINNING OF YEAR
96,989293
85,027662
NET ASSETS, ENO OF YEAR
$ 100,955,298
$ 96.989.293
M
CITY OF At TEXAS
EXHIBIT D-3
WATER AND SEWER ENTERPRISE FUNDS
COMPARATIVE STATEMENTS OF CASH FLOWS
FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2007 AND 200(
2007
2006
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from oashxnens
$ 18,602,810
$ 23.886.558
Cash paid to employees for services
(2,819,333)
(2,771207)
Cash paid for goods and services
(11.812,361)
(9.749.963)
NO cash provided by operating activities
3,971,116
11.365.368
CASH FLOWS FROM NON -CAPITAL FINANCING ACTIVITIES
Transfers from odw hinds
1,495,645
10290
Transfers to other funds
(4.540,175)
(2,182.833)
Net cash provided used in non-Witil financing activities
(3.044.530)
(2.172.3431
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES
Principal paid on revenue bond maturities
(1,580,000)
(1,545,000)
Interest and fees paid on long-term debt
(873,036)
(901,693)
Acquisition and construction of capital assets
(6,667,748)
(7,558,547)
Contributions from developers
1.889.477
1,753.041
Net cash provided by (used in) capital and related financing activities
(7231.307)
(8252,199)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of invesil lsecudtles
(4.406,570)
(9.959.693)
Proceeds from the sale and maturities of invashnent secuddes
7,865285
12,035,393
Interest on mveshnen5
1,106.9D5
797.053
NO rash provided by (used in) Investing activities
4,565,620
2,872.753
NET INCREASE IN CASH AND CASH EQUIVALENTS
(1,739,101)
3,813,599
CASH AND CASH EQUIVALENTS. BEGINNING OF YEAR
12,884,365
9.070.756
CASH AND CASH EQUIVALENTS, END OF YEAR
$ 11,145,254
$ 12.884.355
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
Net Operating income
$ 707,375
$ 5,859.082
Adjushneels to reconcile net operating income
to net cash provided by operating activities:
Depreciation and amortibation expense
4,382,986
4,087,222
Change in assets and liabilities:
(Increase) decrease in accounts receivable
(791,476)
955,464
(Increase) decrease in inventories
10,028
(66,835)
Increase (decrease) in accounts payable
(558,380)
489,658
Increase in accrued liabilities
148,395
29,810
Increase (decrease) In compensated absences
13,809
(46,045)
Increase in utility deposits
58.379
57,032
Total adjustments
3283.741
5.506 306
Net cash provided by operating activities
$ 3,971,116
$ 11,365,388
NON-CASH INVESTING ACTIVITIES:
Change in the fair value of Investments
$ 9,534
$ 108,585
NONCASH FINANCING ACTIVITIES:
Contributions of capibl assets horn developers
$ 4,139.592
$ 6,504,517
87
CITY OF ALLEN, TEXAS EXHIBIT D-4
SOLID WASTE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF NET ASSETS
SEPTEMBER 30.2007 AND 2006
2007 2006
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$ 1,995,5D9
$ 1,275,179
Receivables, net of allowance for uncdlectibles:
Acoouras
233,619
188,440
Other
321,565
299,492
Total current assets
2,550,693
1,763,111
NONCURRENT ASSETS
CAPITAL ASSETS
Vehicles
44,448
44,448
Machinery and equipment
9,819
9.819
Total capital assets
54,267
54,267
Less: accumulated depredation
(50,683)
(41,235)
Capital assets, net of accumulated depreciation
3,584
13,032
Total noncunent assets
3,584
13,032
TOTAL ASSETS
2,554,277
1,776,143
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES
Accounts payable
175,471
69,033
Accrued compensated absences-cunenl
16,828
Accrued liabilities
21,447
32,542
Total current liabilities
213,746
101,575
NON-CURRENT LIABILITIES
Accrued compensated absences
5,351
22,584
Total non- rrenl liabilities
5,351
22,584
TOTAL LIABILITIES
219,097
124,159
NET ASSETS
Invested In capital assets, net of related debt
3,584
13,032
Unrestricted
2,331,596
1,638,952
TOTAL NET ASSETS
$ 2,335,180
$ 1,651,984
I
CITY OF ALLEN, TEXAS
EXHIBIT D-5
SOLID WASTE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
FOR THE YEARS ENDED SEPTEMBER 30, 2007 AND 2006
2007 2006
OPERATING REVENUES
Garbage collections
Other
Total operating revenues
OPERATING EXPENSES
Personnel services
Contractual and other services
Supplies
Depreciation
Other
Total operating expenses
OPERATING INCOME (LOSS)
NON-OPERATING REVENUES
Interest income
INCOME (LOSS) BEFORE TRANSFERS
TRANSFERS
Transfers to other funds
Total transfers
CHANGE IN NET ASSETS
NET ASSETS, BEGINNING OF YEAR
NET ASSETS, END OF YEAR
[U
$ 4,652,398
$ 4,073,155
45,407
383284
4,597,805
4,436,419
219,162
258,661
3,834,416
3,174,850
9,438
11,074
9,449
10,806
48,595
67,703
3,921,060
3,523,094
676,745
913,325
80,586
33,904
757,331
947,229
(74,135) (48,078)
(74,135) (48,078)
683,195 899,151
1,651,984 752,833
$ 2,335,180 $ 1,651,984
CITY OF ALLEN, TEXAS
EXHIBIT D-8
SOLID WASTE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF CASH FLOWS
FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2007 AND 200E
2007
2008
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers
$ 4,530,553
$ 4,272,563
Cash paid to employees for services
(236,395)
(258,172)
Cash paid for goods and services
(3,597,107)
(3,476,564)
Net cash provided by (used in) operating activities
897,051
537,827
CASH FLOWS FROM NOWCAPITAL FINANCING ACTIVITIES
Transfers to other funds
(74,135)
(48,078)
Net cash used in noncapital financing activities
(74135)
(48,078)
GSH FLOWS FROM INVESTING ACTIVITIES
Interest on investments
80.888
33,804
Net cash provided by investing activities
80,586
33•904
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
703,502
523,653
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
1,275,179
751,526
CASH AND CASH EQUIVALENTS, END OF YEAR
$ 1,978,681
$ 1,275,179
RECONCILIATION OF OPERATING (LOSS) TO
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
Net Operating (loss)
$ 678,745
$ 913,325
Adjustments to recencile net operating (loss)
to net cash provided by (used in) operating activities:
Depreciation
9,449
10,806
Change in assets and liabilities:
Increase in accounts receivable
(45,179)
(27.104)
Increase in other receivables
(22.073)
(138,752)
Increase (decrease) in accounts payable
108,437
(233,886)
Increase in accrued liabilities
(11.095)
10,949
Increase in accrued compensated absences
(17,233)
489
Total adjustments
20,306
(375,498)
Net cash provided by (used in) operating activities
$ 697,051
$ 537,827
MR
CITY OF ALLEN, TEXAS EXHIBIT DJ
DRAINAGE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF NET ASSETS
SEPTEMBER 30, 2007 AND 2006
2007 2006
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$ 1,240,556
$ 1,027,531
Pcwums receivable,
53,942
42,008
Total current assets
1,294,498
1,069,539
NONCURRENT ASSETS
CAPITAL ASSETS
Other improvements
496,132
496,132
Vehicles
102,079
106,809
Machinery and equipment
373,734
373,734
Total capital assets
971,945
976,675
Less: accumulated depreciation
(400,531)
(357,936)
Capital assets, net of accumulated depreciation
571,414
618,739
Total noncurrent assets
571,414
618,739
TOTAL ASSETS
1,865,912
1,688,278
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES
Accounts payable
22,774
7,307
Accrued compensated absences
10.791
Accrued liabilities
8,867
8,368
Total current liabilities
42,432
15,675
NON-CURRENT LIABILITIES
Accrued compensated absences
3,431
10,609
Total ron-accent Iiabil8ies
3,431
10,609
TOTAL LIABILITIES
45,863
26,284
NETASSETS
Invested in capital assets, net of related debt
571,414
618,739
Unrestricted
1,248,635
1,043.255
TOTAL NET ASSETS
$ 1,820,049
$ 1,661,994
91
CITY OF ALLEN, TEXAS
EXHIBIT D8
DRAINAGE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
FOR THE YEARS ENDED SEPTEMBER 30, 2007 AND 2006
2007 2006
OPERATING REVENUES
Drainage fees
Service charges
Miscellaneous
Total operating revenues
OPERATING EXPENSES
Personnel services
Contractual and other services
Maintenance
Supplies
Depreciation
Other
Total operating expenses
OPERATING INCOME
Non-operating revenues - interest income
INCOME BEFORE TRANSFERS
TRANSFERS
Transfers to other funds
Total operating transfers
CHANGE IN NET ASSETS
NET ASSETS, BEGINNING OF YEAR
NET ASSETS, END OF YEAR
92
$ 909,066 $
861,947
66,573
123,166
14,895
975,639
1,000,008
299,721
270,148
87,916
87,469
178,765
186,423
28,632
11,641
47,326
55,791
63,143
36,283
705,503
647,755
270,136
352,253
58,494
37,637
328,630
389,890
(170,575) (141,655)
(170,575) (141,655)
158,055 248,235
1,661,994 1,413,759
$ 1,820,049 $ 1,661,994
CIN OF ALLEN, TEXAS
DRAINAGE ENTERPRISE FUND
COMPARATIVE STATEMENTS OF CASH FLOWS
FOR THE FISCAL YEARS ENDED SEPTEMBER 30,2D07 AND 2006
EXHIBIT D-9
2007
2006
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers
$ 963,705 $
998,486
Cash paid to employees for services
(306,899)
(270,052)
Cash paid for goods and services
(342,491)
(326,931)
Net cash provided by operating activities
314,315
401,503
CASH FLOWS FROM NON -CAPITAL FINANCING ACTIVITIES
Transfers to other funds
(170,575)
(141,655)
Net cash used in nonrapital financing activities
(170,575)
(141,655)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest on investments
58,494
37,637
Net cash provided by investing activities
58,494
37,637
NET INCREASE IN CASH AND CASH EQUIVALENTS
202,234
297,485
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
1,027,531
730,046
CASH AND CASH EQUIVALENTS, END OF YEAR
$ 1,229,765 $
1,027,531
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
Net operating income
$ 270,136 $
352,253
Adjustments to reconcile net operating income
to net cash provided by operating activities:
Depreciation
47,326
55,791
Change in assets and liabilities:
(11,934)
(1,522)
(Increase) in accounts receivable
(Decrease) in accounts payable
15,466
(4,598)
Increase (decrease) in accrued liabilities
499
(517)
Increase in compensated absences
(7,178)
96
Total adjustments
44,179
49,250
Net cash provided by operating activities
$ 314,315 $
401,503
CIN OF ALLEN, TEXAS
EXHIBIT D-10
GOLF COURSE ENTERPRISE FUND
STATEMENTS OF NET ASSETS
SEPTEMBER 30, 2007 AND 2006
2007
2DD6
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$ 233,047 $
34,140
Accounts receivable
6,849
15,710
Due from other funds
-
90,000
Prepaid items
11,050
11,050
Total current assets
250,946
150,900
NONCURRENT ASSETS
CAPITAL ASSETS
Fumiture and fixtures
10,894
-
Machinery and equipment
309,508
296,790
Less: accumulated depredation
(247,948)
(175,210)
Capital assets, net of accumulated depreciation
72,454
121,580
Total noncurrent assets
72,454
121,580
TOTAL ASSETS
323,400
272,480
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES
Accounts payable
67,625
46,052
Acc ued liabilities
32,517
33,489
Accrued compensated absences
19,789
-
Capitalleasespayable - current
36,063
88,713
Customer deposits payable
26,488
23,969
Total current liabilities
182,482
192,223
NON-CURRENT LIABILITIES
Capital leases payable
15,140
51,203
Accrued compensated absences
12,936
23,777
Total non-current liabilities
28,076
74,980
TOTAL LIABILITIES
210,558
267,203
NET ASSETS
Invested in capital assets, net of related debt
21,251
(18,336)
Unrestricted
91,591
23,613
TOTAL NET ASSETS
$ 112,842 $
5,277
i
CITY OF ALLEN, TEXAS
GOLF COURSE ENTERPRISE FUND
STATEMENTS OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
FOR THE YEARS ENDED SEPTEMBER 30, 2007 AND 2006
OPERATING REVENUES
Service charges
Miscellaneous
Total operating revenues
OPERATING EXPENSES
Personnel services
ContracWal and other services
Maintenance
Supplies
Depreciation
Other
Total operating expenses
OPERATING LOSS
TRANSFERS
Transfers from other funds
Transfers to other funds
Total operating transfers
CHANGE IN NET ASSETS
NET ASSETS, BEGINNING OF YEAR
NET ASSETS, END OF YEAR
95
EXHIBIT D-1 t
2007 2006
$ 1,317,956 $ 1,294,941
22,131 2,486
1,340,087 1,297,427
981,802
515,133
76,054
123,946
72,738
33,501
1,803,174
(463,087)
982,610
647,374
107,234
108,421
108,763
40,078
1,994,480
(097,053)
570,652
707,000
(8,712)
570,652
698,288
107,555
1,235
5,277
4,042
$ 112,842
$ 5,277
CITY OF ALLEN, TEXAS
GOLF COURSE ENTERPRISE FUND
STATEMENTS OF CASH FLOWS
FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2007 AND 2006
EXHIBIT D-12
2007
2006
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers $ 1,348,948 $
1,297,413
Cash paid to employees for services
(992,643)
(987,661)
Cash paid for goods and services
(725,514)
(894,457)
Net cash used in operating activities
(369,209)
(584,705)
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES
Operating transfers from other funds
660,652
627,000
Operating transfers to other funds
(8,712)
Net cash provided by non-capital financing activities
680,652
618,288
CASH FLOWS FROM CAPITAL
AND RELATED FINANCING ACTIVITIES
Acquisition and construction of capital assets
(23,612)
-
Capital lease down payment
(88,713)
(98,730)
Net cash used in capital and related financing activities
(112,325)
(98,730)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
179,118
(65,147)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
34,140
99,287
CASH AND CASH EQUIVALENTS, END OF YEAR
$ 213,258 $
34,140
RECONCILIATION OF OPERATING LOSS TO NET CASH
USED IN OPERATING ACTIVITIES
Net operating loss
$ (463,087) $
(697,053)
Adjustments to reconcile net operating loss
to net cash used in operating activities:
Depreciation
72,738
108,763
Change in assets and liabilities:
(Increase) in accounts receivable
8,881
(14)
Increase in accounts payable
21,573
2,383
Increase (decrease) in accrued liabilities
(972)
(1,022)
Increase in customer deposits
2,519
7,289
Increase (decrease) in compensated absences
(10,841)
(6,051)
Total adjustments
93,878
112,348
Net cash used in operating activities
$(369,209) $ (584,706)
I
64*��spEGT 1'NtE6 +Y
qr
4 �A
V
r C tW or At -L od
INTERNAL SERVICE FUNDS
The Internal Service Funds are used to account for financing of services provided by one department to
other departments of the City on a cost -reimbursement basis.
Replacement Fund - accounts for the costs associated with the acquisition of vehicles, machinery, and
equipment through the rental of such items to other departments.
Risk Management Fund — amounts for the costs associated with workers compensation, liability and
property insurance and medical and dental programs established for City employees and their covered
dependents.
CITY OF ALLEN, TEXAS EXHIBIT E-1
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF NET ASSETS
SEPTEMBER 30,2007
(WITH COMPARATIVE TOTALS FOR SEPTEMBER 30 2006)
RISK TOTALS
REPLACEMENT MANAGEMENT
FUND FUND 2007 2006
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$ 3,764,597 $
2,506,894 $
6,261,491 $
4,431,425
Investments
2,036,567
-
2,036,567
2,986,826
Accounts receivable
-
2,295
2.295
-
Acolued interest receivable
21,751
21,751
23,712
Total current assets
5,812,915
2,509.189
8,M,104
7,441,963
CAPITAL ASSETS
Machinery and equipment
1,167,326
-
1,187,326
821,431
Vehides
3,875,798
-
3,875,798
3,388,300
Accumulated depredation
(2,440,479)
-
(2,440.479)
(1,910,339)
Capital assets,
net of acdumulated depredation
2,602,845
2,602,645
2,299,392
TOTAL ASSETS
8,415,560
2,509,189
10,924,749
9,741,355
LIABILITIES AND NET ASSETS
LIABILITIES
Accounts payable
32,527
106,409
138,936
263,906
Incurred but not reported claims
-
617,301
617,301
515,021
TOTAL LIABILITIES
32,527
723,710
756,237
778,927
NET ASSETS
Invested in capital assets,
net of related debt
2,602,645
-
2,602,645
2,299,392
Unrestricted
5,780,388
1,785,479
7,565,867
6,663,036
TOTAL NET ASSETS
$ 8,383,033 $
1,785,479 $
10,168,512E
1,962,428
D11
CT' 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, 2007
(WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2008)
RISK TOTALS
REPLACEMENT MANAGEMENT
FUND FUND 2007 2008
OPERATING REVENUES
Charges for services
Other income
Total operating revenues
OPERATING EXPENSES
Personal services
Contractual services
Depreciation
Total operating expenses
OPERATING INCOME
NON-OPERATING REVENUES
Investmem earnings
Gain on disposal of capital assets
Total non-operating revenues
INCOME BEFORE TRANSFERS
TRANSFERS
$ 1,196,563 $
6,144,619 $
7,341,182 $
6,266,847
Total transfers
67,396
67,396
44,789
1,196,553
6212,015
7,408,578
6,311,636
NET ASSETS, BEGINNING OF YEAR 7,505,788
1,456,640
8,962,428
-
156,678
156,678
148,613
-
6,056,994
6,056,994
4,874,327
668,279
668,279
450,369
668,279
6,213,672
6,881,951
5,473,309
528,284
(1,657)
526,627
838,327
310,462
121,831
432293
286,652
38,498
38,499
6,752
348,961
121,831
470,792
293,404
877.245
120,174
997,419
1,131,731
Transfers from other funds
208,685
208,665
230,357
Total transfers
208,685
208,665
230,357
CHANGE IN NET ASSETS 877,245
328,839
1,206,084
1,362,088
NET ASSETS, BEGINNING OF YEAR 7,505,788
1,456,640
8,962,428
7,600,340
NET ASSETS, END OF YEAR $ 8,383,033 $
1,785,479 $
10,168,512 $
8,962,428
99
CITY DF ALLEN, TEILAS EXHIBIT E-3
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED SEPIESiBER 30, 2007
(MATH COMPARATVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30 2006)
RISK TOTALS
REPLACEMENT MANAGEMENT
FUND FUND 2007 2008
CASH FLOWS FROM OPERATNG ACTVITES
Cash received hoot trenm lions wilb other funds
Caen mid to employees farry ry
Casa mM for goods eM services
Cash pale firtlaim.
Net man Wovided by operating ac5v19es
CASH FLOWS FROM NONC ITAL FINANCING ACWWS
TraneleM sono aNx Nr1ds
Net man provided by nm -capital financt ac5N5ss
CASH FLOWS FROM CAPITAL AND RELATED
FINANCINGACTVITES
Aryuisi5on of mpiMl ae.em
Promstla frern sale of metal assets
had mah used In mpital and related fimndng act'ni ie;
CASH FLOWS FROM INVESTING AGW`rIES
Purtlrese of inves6nmt secuntles
Proceed. from sale and InatulNea of imesbnerd semMias
Interest on InvesMenb
Net rash provided by (used in) inwstirg ac5vi5es
NET INCREASE (DECREASE)
IN CASH AND CASH EQUIVALENTS
CASH AND GASH EQUIVALENTS, BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS, END OF YEAR
RECONCIU ATON OF OPERATNG INCOME TO
NET CASH PROVIDED BY OPERATNG ACTVITIES
Net operating inmnne
AGlustmm%to reoondla opemerg inconte
to net muh provided In, .,.b g acevil@s:
Depreciation
Change in assets aM IiaNSnes:
Der ase (lncosase) in a..%..IhWe
hrvease in xcouos payable
Total adlusbnures
Net msh promded by operating acdvl5es
NONCASHINVE5TNGAC ES:
Change M the Mir value of investments
8 1,105,303 $
6,20'920
$ 7,315,028
$ 8,515,813
-
(158,678)
(158,578)
(148,813)
-
(2,47;611)
(2,472,511)
(114011383)
(91,257)
(3,515,91M
(3,515,918)
(3.82,058)
577022
61
110,305
84.815
1169921
1,500,551
1,169,921
$ 1,50D.554
$ 49,741
S S
49,741
206,655
206365
230,357
208,665
208.665
230,357
(1,037,386)
-
(1,037,386)
(925,214)
101.353
104.353
5,752
(933,33)
(933,33)
M18,4821
995,933
-
895,933
(3,033,072)
_
-
-
3,00,00
266.749
121.831
360.580
284,563
1262352
121331
1,364,513
231,591
1,434,955
395,111
1,830,0118
1,041,40
2319.012
2,111,783
4.431.425
3.387.385
$ 3,754.597 $
230'894
S 8261.491
S 4.431.425
$ 528.201
S (11857) $
52'627
S 63'327
888279
66'279
45'369
-
(2,295)
(2285)
6'193
(91,257)
65.567
(22,90)
131,665
577022
61
643,294
662222
$ 1,105,306
S 64.815 $
1,169,921
$ 1,50D.554
$ 49,741
S S
49,741
$ 7,271
100
DISCRETELY PRESENTED COMPONENT UNITS
Allen Economic Development Corporation (AEDC) — AEDC is a legally separate entity from the City and
Is responsible for aiding, promoting and furthering economic development within the City.
Allen Community Development Corporation (ACDC)—ACOC is a legally separate entity from the City and
is responsible for supporting the improvements in community parks and recreation, streets and sidewalks,
public safety and the community library.
101
CITY OF ALLEN, TEXAS EXHIBIT F-1
ALLEN ECONOMIC DEVELOPMENT CORPORATION
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30, 2007 AND 2006
LIABILITIES AND FUND BALANCES
CURRENT LIABILITIES
Accounts payable
2007
2006
ASSETS
12,884
10,253
CURRENT ASSETS
1,461,041
235,784
Cash and cash equivalents
$ 856,156 $
3,454,552
Investments
1,741,319
1,961,439
Sales tax receivable
838,319
812,617
Accounts receivable
1,301
1,562
Accrued interest receivable
18,598
15,572
TOTAL ASSETS
$ 3,455,693 $
6,245,742
LIABILITIES AND FUND BALANCES
CURRENT LIABILITIES
Accounts payable
$ 1,448,157 $
225531
Ac ed and other liabili8es
12,884
10,253
TOTAL LIABILITIES
1,461,041
235,784
FUND BALANCES
Unrestricted
1,994,652
6,009,958
TOTAL LIABILITIES AND FUND BALANCES
$ 3,455,693 $
6,245,742
102
CITY OF ALLEN, TEXAS
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET ASSETS
ALLEN ECONOMIC DEVELOPMENT CORPORATION
SEPTEMBER 30,2007
EXHIBIT F-2
Total governmental fund balance $ 1,994,652
Amounts reported for governmental activities in the statement of net assets
are different because:
Capital assets (net of accumulated depreciation) used in governmental activities
are not current financial resources and therefore are not reported in the
governmental funds balance sheet. 9,461,263
Net assets of governmental activities
103
$ 11,455,915
CITY OF ALLEN. TEXAS
ALLEN ECONOMIC DEVELOPMENT CORPORATION
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2007 AND 2006
REVENUES
Sales and other taxes
Investment earnings
Miscellaneous
Total revenues
EXPENDITURES
Current:
Economic development
Capital projects:
Economic development
Total expenditures
Excess of revenues over expendibires
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
104
EXHIBIT F-3
2007 2006
$ 4,837,072 $ 4,579,623
310,990 277,912
22,115 596,890
5,170,177 5,454,425
6,125,403 5,138,322
3,060,080
251,203
9,185,483
5,389,525
(4,015,306)
64,900
6,009,958
5,945,058
$ 1,994,652 $
6,009,958
CITY OF ALLEN, TEXAS
RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT
OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
TO THE STATEMENT OF ACTIVITIES
ALLEN ECONOMIC DEVELOPMENT CORPORATION
FOR THE YEAR ENDED SEPTEMBER 30, 2007
EXHIBIT F-4
Net change in fund balances - total governmental funds $ (4,015,306)
Amounts reported for governmental activities in the statement of activities
are different because:
Depreciation expense on capital assets is reported in the statement of activities but
does not require the use of current financial resources. Therefore, depreciation
expense is not reported as expenditures in the governmental funds. (143,725)
Governmental funds report capital outlays as expenditures. However, in the
statement of activities the cost of those assets are allocated over their estimated
useful lives and reported as depreciation expense. 3,060,080
Change in net assets of governmental activities $ (1,098,951)
105
CITY OF ALLEN, TEXAS EXHIBIT F-5
ALLEN COMMUNITY DEVELOPMENT CORPORATION
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30.2D07 AND 2006
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Investments
Sales tax receivable
Accounts receivable
Accrued interest receivable
TOTAL ASSETS
LIABILITIES AND FUND BALANCES
CURRENT LIABILITIES
Accounts payable
Retainage payable
TOTAL LIABILITIES
FUND BALANCES
Reserved for encumbrances
Unreserved
Total fund balance
TOTAL LIABILITIES AND FUND BALANCES
106
$ 6,522,230 $
5,131,812
2,859,239
1,734,374
838,320
812,617
39,301
1,562
30,537
13,769
$ 10,289,627 $
7,693,934
$ 343,543 $ 191,493
73,940 31,891
417,483 223,384
497,827 547,625
9,374,317 6,922,925
9,872,144 7,470,550
$ 10,289,627 $ 7,693,934
CRY OF ALLEN, TEXAS
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET ASSETS
ALLEN COMMUNITY DEVELOPMENT CORPORATION
SEPTEMBER 30,2007
EXHIBIT F-6
Total governmental fund balance
$ 9.672.144
Amounts reported for governmental activities in the statement of net assets
are different because:
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.
67,130
Interest payable on long-term debt does not require current financial resources,
and, therefore, is not reported as a liability in the governmental funds
balance sheet.
(26,525)
Long -tens liabilities, including bonds payable are not due and payable in the
current period and, therefore, are not reported in the fund financial statements.
(7,188,439)
Net assets of governmental activities
107
$ 2,744,310
CITY OF ALLEN, TEXAS EXHIBIT F-7
ALLEN COMMUNITY DEVELOPMENT CORPORATION
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEARS ENDED SEPTEMBER 30, 2007 AND 2006
REVENUES
Sales and other taxes
Investment earnings
Total revenues
EXPENDITURES
Current:
Community development
Capel projects:
Community development
Debt service:
Principal retirement
Interest and fiscal charges
Total expenditures
Excess of revenues over expenditures
OTHER FINANCING SOURCES AND (USES)
Issuance of refunding debt
Premium on Issuance of debt
Payment to refund bond escrow agent
Total other financing sources
NET CHANGE IN FUND BALANCES
FUND BALANCES, BEGINNING OF YEAR
FUND BALANCES, END OF YEAR
108
2007
2006
$ 4,837,072
$ 4,579,623
450,743
283,700
5,287,815
4,863,323
611,457
691,494
1,461,696
1,115,573
470,000
445,000
343,068
344,110
2,886,221
2,596,177
2,401,594
2,267,146
-
5,600,000
184,499
(5,732,704)
51,795
2,401,594
2,318,941
7,470,550
5,151,609
$ 9,872,144
$ 7,470,550
CITY OF ALLEN, TEXAS
RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT
OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
TO THE STATEMENT OF ACTIVITIES
ALLEN COMMUNITY DEVELOPMENT CORPORATION
FOR THE YEAR ENDED SEPTEMBER 30, 2007
EXHIBIT F-8
Net change in fund balances - total govemmental funds $ 2,401,594
Amounts reported for governmental activities in the statement of activities
are different because:
Governmental funds report the effect of issuance costs, premiums, discounts, and similar
Items when debt is first issued. However, these amounts are deferred and amortized 6,590
In the government -wide financial statements.
Current year changes in accrued interest payable do not require the use of current
financial resources and, therefore, are not reported as expenditures in governmental
(2,889)
funds.
Repayment of the principal on long-term debt consumes the current financial
resources of governmental funds. However, these transactions have no 870,000
effect on net assets.
Change in net assets of govemmental activities $ 2,875,295
109
a�SFECT
Ps
4�
'NTFG
R?
r
CITY OF
CAPITAL ASSETS
USED IN THE OPERATION
OF GOVERNMENTAL FUNDS
a�SpEGT
t`
4�
IN),
cq
,r
Y
ORY OF AU`EN
CITY OF ALLEN, TEXAS
COMPARATIVE SCHEDULES OF CAPITAL ASSETS USED IN
THE OPERATION OF GOVERNMENTAL FUNDS - BY SOURCE (a)
SEPTEMBER 30, 2007 AND 2006
GOVERNMENTAL FUNDS CAPITAL ASSETS
Land and land improvements
Buildings
Machinery and equipment
Furniture and fixtures
Vehicles
Books
Infrastructure
Total property and equipment in service
Constmcbon in progress
Total governmental funds capital assets
INVESTMENTS IN GOVERNMENTAL FUNDS CAPITAL ASSETS
BY REVENUE SOURCE
EXHIBIT G-1
2007 2006
$ 103,304,007 $
98,611,044
52,231,593
45,583,715
4,380,533
4,005,827
2,894,713
2,846,757
3,021,981
3,171,545
2,761,938
2,670,852
345,395,845
314,890,086
513,990,610 471,779,826
10,835,221 27,591,180
$ 524,825,831 $ 499,371,006
General obligation bond proceeds and interest income
$ 106,550,241 $
104,521,162
Revenue bonds
10,475,000
10,475,000
Conidbutions
307,084,732
291,128,363
Other governments
9,951,500
9,951,500
General and other fund operations
79,115,782
73,728,723
Special revenue funds
11,648,576
9,566,258
Total governmental funds capital assets
$ 524,825,831 $ 499,371,006
(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.
110
CITY OF ALLEN
SCHEDULE OF CAPITAL ASSETS USED IN THE OPERATION OF
GOVERNMENTAL FUNDSBY FUNCTION AND ACTNIIY (a)
AS OF SEPTEMBER 30, 2007
Function arm Act *
IoM lam Imwoyenbnb
Bil"
Medinery 8
EgWmn
GENERAL GOVERNMENT
Munkipal mart E
631,788 $ S
269,669 E
57,885
City administration
432,333
8,871,016
181,028
InformationI no4ogy
268,244
Human resaaose
IrBemal servcas
(6,784)
Tafel General Government
1,064,121
9,160,6&5
500,373
PUBLIC SAFETY
Police
6,729,217
471,105
Fre
24,100
8,983,460
841.269
TotalRtlR seiw
24,100
13,]126]!
1.312374
PUBLIC WORKS
Community servims BstrcJs
51,236,812
287,360
Engineering
38,635,407
15,887
Trial PaNk Nbrks
89,875,219
303,257
CULTURE 6 RECREATION
PaAs Bre .uon
10,998,411 642,156
18,316,844
961,483
Literary
11.041,387
532849
TDWCultu.&Revestion
10,990.411 642,156
29,350.231
IAN,=
COMMUNITY DEVELOPMENT
Bulding 8 cone mmplianoe
10,790
Plannug 8 tlevebpmeK
6,993
Totals unity develoWnent
17,783
GRANTADMINISTRATION
GraMAEministra8on
500.000
752,414
Totalgmnta6ministraton
500,000
752414
Construc0an in Progress
Total governmental funds metal assets E im2 l.851 E 802,158E 52,231.593E 4,380.533
111
EXH191T G2
Fum .5 Cnubw !o
Fbmaec Ve des Boob Otlix lnpeovenieod Pr09re4a Tod!
$ 413 $
$
$ $
$ 979,755
M,
97,019
89560,203
10,323,085
16,009
9,651
222,321
518,255
3,335
3,336
18.321
666,404
15,722.412
11,537
876,788
9,681
222,321
11 833,969
1495.631
668404
2697,810 15722,412
63275.387
261,717
352,985
71,867
7,886,891
235,398
1.347,562
288,885
9791.774
49],115
341.752
175aa.865
135088
225,687
259,3Ya,927
311,107,766
17,701
97,019
89560,203
10834] 227
17,701
322686
326936,130
/19454993
658,1]2
666,404
15,722.412
48,10,882
839459
2697.810
15,111, 0
1495.631
668404
2697,810 15722,412
63275.387
135088
145,879
7,478
14,471
7.478 735.089
180 `3'i0
187474128 173230
167] 248
1474 81,64.128 173230
87,
1877246
10 835221 10 835 221
S 2,894,713 $ 3,021,981 5 2.781,938 i Us M80.5 S 10,935,221 $ 524,825,831
112
CITY OF ALLEN, TEXAS
SCHEDULE OF CHANGES IN CAPITALASSETS USED IN THE OPERATION
OF GOVERNMENTAL FUNDS - BY FUNCTION AND ACTWf1Y (a)
FOR THE FISCAL YEAR ENDED SEPTEMBER 30 ZBOT
EXHIBITG-3
O�oftMrl Ca01tl AeN6 Fund,at
Funam and /.m NN 2. �j Lin j gay Ton 30.2107
GEHERALGOVENNMENT
sea
uundpal Gun! $
8]8,)55 f
5
$
S f
loans
CS, Al�i8ma1'vi
10,2N,a61
%in
21,3"
10,323,00
Im,nnat nTetlamT'
CMMQD
85.07
518257
H. Rmrtea
SM
3.338
INemN Selvint
11,SS1
11A37
FYprce
TdN Ga1wYC N
11.]00]"
89.]03
21.969
11A49.%d
PUBUICGAF6TY
pub
751OX18
WA18
(116,383)
295,"2
7X%,891
Fk
B.WL]28
74006
M.Ssl1
",an
8,701n9
TOW PUN. S.F
17.115580
31].]19
(158,9091
312X15
17XBSX65
PUBLIC WGRKs
Canlviy aviQseIDre6
311X91,139
(133,373)
311,10],]%
Fpmae9q
NL A911740
1(853X81
351,4X5
WZ
9,2PA13
108}9])2]
T.. WUAa
3.5132W
19,'"X61
359."5
1167,8131
9237X13
919,959,8%
CULIURE 8 RECREATION
Pa &RwarBm
32.006,917
lAsean
b]A]2
19,581,4110
91183X83
LINq
19X%.9%
IWA00
(58,91"
W.019
15.111X%
Tab!CUOae d R—fion".1N=
1.WB.Bn
SWATS
IY.919)
15.9%AN
'®3]5.317
COMNUMnY DEVELOW.IFNT
&lSgdCOR L'�feelLa
1b.13s
(12%9)
M"
PYraApd OeMaprcnl
NAH
19,471
TOH Lonmuiy0erebpmy
172X00
1122511
184350
GRRNTAIB S.InON
GmX/Wiiatra5an
1."81"
1A.%1
83.121
1,1772"
Tebl ldaNAeei9stra"n
1,461,1"
lE%1
69,121
1.17]396
TON9<male...Sbde6
99 FupM
n1.n9Xz6
ISAMe 89
1463,959
(39911713)
25,184,171
513,990,810
Cn¢Tr(5wlFpe9reaa
27,591.1%
9,92121z
R5.1811]11
la%i5221
TuuI ii -aa Xel fimMm a1
—ur S_
999.s]L006 S 15X56.369 f
9X82.1]1
S (311]15) i S
5"X25,%1
Trial9 rneMal M1mEa
.g,kwe. S
989.3]1,005 $
15.%6,368 $
18.320.311 i (393,715) $_ [25,134,111) S
529,025.831
(a) This schedule presents only the oSpilal assel balances related to governmental funds,
Including infmstmdure. Accordingly, the capital as"ts repoded in the intemal service
funds are e2duded from the above amounts. Generally, the capital assets of internal
service funds are included! as govemmental activities in the statement of net assets.
113
STATISTICAL SECTION
(UNAUDITED)
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n
CITY OF Al.`.gN
STATISTICAL SECTION
This part of the City of Allen's comprehensive annual financial report presents detailed information as a
context for understanding what the information in the financial statements, notes disclosures, and required
supplementary information says about the City's overall financial health. This information has not been
audited by the independent auditor.
Contents
Table IRs
Financial Trends
1, 2, 3 & 4
These tables contain trend information to help the reader understand how the City's
financial performance and well-being have changed over time.
Revenue Capacity
5, 6, 7 & B
These tables contain information to help the reader assess the City's two most significant
local revenue sources, the property and sales taxes.
Debt Capacity
9, 10, 11 & 12
These tables present information to help the reader assess the affordability of the City's
current levels of outstanding debt and the Citys ability to issue additional debt in the future.
Economic and Demographic Information
13 & 14
These tables offer economic and demographic indicators to help the reader understand the
environment within which the City's financial activities take place.
Operating Information
15,16 & 17
These tables contain service and infrastructure data to help the reader understand how the
information in the City's financial report relates to the services the City provides.
Source: Unless otherwise noted, the information in these tables is derived from the comprehensive annual
financial reports for the relevant year. The City implemented GASB Statement 34 in fiscal year 2003: tables
presenting government -wide information include Information beginning in that year.
114
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132
x 0'VEGT * INTFC
* CITT OF Al•b`d
CITY OF ALLEN, TEXAS
REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING
YEAR ENDED SEPTEMBER 30, 2007
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
I I I AND ON COMPLIANCE AND OTHER MATTERS BASED ON
AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENTAL AUDITING STANDARDS
WEAVER City Council
TIDWELL City of Allen, Texas
Allen, Texas
L�L.P We have audited the financial statements of the governmental activities, its discretely
CERTIFIED PUBLIC presented component units, each major fund and the aggregate remaining fund
AccouNTANTs information of City of Allen as of and for the year ended September 30, 2007, and have
AND CONOMLTANI issued our report thereon dated March 14, 2008. We conducted our audit in
accordance with auditing standards generally accepted in the United States of America
and the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered City of Allen's internal control over
financial reporting as a basis for designing our auditing procedures for the purpose of
expressing our opinion on the financial statements, but not for the purpose of
expressing an opinion on the effectiveness of the City of Allen's internal control over
financial reporting. Accordingly, we do not express an opinion on the effectiveness of
the City of Allen's internal control over financial reporting.
Our consideration of internal control over financial reporting was for the limited purpose
described in the preceding paragraph and would not necessarily identify all deficiencies
in internal control over financial reporting that might be significant deficiencies or
material weaknesses. However, as discussed below, we identified certain deficiencies
in internal control over financial reporting that we consider to be significant deficiencies.
A control deficiency exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned
functions, to prevent or detect misstatements on a timely basis. A significant deficiency
is a control deficiency, or combination of control deficiencies, that adversely affects the
City of Allen's ability to initiate, authorize, record, process, or report financial data
reliably in accordance with generally accepted accounting principles such that there is
more than a remote likelihood that a misstatement of the City of Allen's financial
statements that is more than inconsequential will not be prevented or detected by the
City of Allen's internal control. We consider the deficiency described in the
accompanying schedule of findings and responses to be a significant deficiency in
internal control over financial reporting. 2007-01.
A material weakness is a significant deficiency, or combination of significant
deficiencies, that results in more than a remote likelihood that a material misstatement
of the financial statements will not be prevented or detected by the entity's internal
control.
Our consideration of the internal control over financial reporting was for the limited
purpose described in the first paragraph of this section and would not necessarily
identify all deficiencies in the internal control that might be significant deficiencies and,
accordingly, would not necessarily disclose all significant deficiencies that are also
considered to be material weaknesses. However, we believe that none of the
Th- rnn Pk, significant deficiencies described above is a material weakness.
12221 A4mt Durr
1.11 1400
Dolt; T -.a 75251-2280
9724A9 1970
T 9]2.7028321
WW WWEAVEEAMDTDKNELIL LOM
AN INDEPENDENT MEMBER OF O'FAESM•
BAKER TILLV
INTE BNATIONPL DALLAS FOWNVBTI NOOBTON
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
AND ON COMPLIANCE AND OTHER MATTERS BASED ON
AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENTAL AUDITING STANDARDS
Compliance and Other Matters
As part of obtaining reasonable assurance about whether City of Allen'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 or other matters that are
required to be reported under Government Auditing Standards.
This report is intended for the information of the District's Board of Directors, the audit
committee, the administration, federal awarding agencies and pass-through entities,
and is not intended to be used and should not be used by anyone other than these
specified parties.
Very truly yours,
WEAVER AND TIDWELL, L.L.P.
Dallas, Texas
March 14, 2008
CITY OF ALLEN, TEXAS
SCHEDULE OF FINDINGS AND RESPONSES
SEPTEMBER 30, 2007
2007-01:
Finding
During our testing of property and equipment, we found discrepancies between the balance of
fixed assets noted in the government wide financial statements and what had been recorded in
the depreciation system and noted that some assets had been duplicated in the depreciation
system. As a result the City had taken approximately $940,000 to much in depreciation expense
in prior years. Due to the volume of activity Flowing through the fixed asset and depreciation
listings we recommend that a reconciliation of the two listings is performed on a regular basis to
more easily and quickly resolve differences.
Management Response
During the audit when staff became aware of the discrepancies between the balance of fixed
assets and depreciation amounts, it was found that the discrepancies originated between fiscal
years 2002 and 2003.
The Fixed Asset module of the City's financial software was implemented in 2002 to prepare for
the new GASB 34 reporting requirement implemented in FY2003 and to automate financial
tracking of fixed assets and depreciation calculations. Prior to automating fixed asset purchases,
multiple funding sources (enterprise and governmental funds) were used to purchase assets
which made it difficult to determine which fund would own the assets.
Changes were made so that assets are now purchased from one fund to allow the general ledger
to reconcile to the Fixed Asset application. Current accounting staff must now go back and
reconcile the two applications and determine where the adjustments need to be made. This
project will require considerable accounting research wlth plans for completion prior to the close
of fiscal year 2007-2008.