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1993 Annual Financial ReportSECRETARY ®�IaINAL COPY CITY OF BANGER, TEXAS FINANCIAL STATEMENTS SEPTEMBER 30, 1993 TABLE OF CONTENTS PAGE # AUDITOR'S REPORT 1 CITY OFFICIALS 2 COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS 3 COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - ALL GOVERNMENTAL FUND TYPES 4 COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - ALL GOVERNMENTAL FUND TYPES - BUDGET AND ACTUAL 5 COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN RETAINED EARNINGS - PROPRIETARY FUND 6 COMBINED STATEMENT OF CASH FLOWS - PROPRIETARY FUND 7 NOTES TO FINANCIAL STATEMENTS 8-15 COMBINING AND INDIVIDUAL FUND AND ACCOUNT GROUP STATEMENTS COMBINING STATEMENT OF REVENUES & EXPENDITURES GENERAL FUND 16 COMBINING STATEMENT OF REVENUES & EXPENDITURES GENERAL FUND - BUDGET AND ACTUAL 17 STATEMENT OF GENERAL FIXED ASSETS 18 SCHEDULE OF CHANGES TO GENERAL FIXED ASSETS 19 SCHEDULE OF PROPERTY, PLANT & EQUIPMENT - PROPRIETARY FUND 20 STATEMENT OF GENERAL LONG-TERM DEBT 21 SCHEDULE OF CHANGES IN GENERAL LONG-TERM DEBT 22 SCHEDULE OF GENERAL FUND DEBT SERVICE REQUIREMENTS 23 SCHEDULE OF CHANGES IN LONG-TERM DEBT - PROPRIETARY FUND 24 SCHEDULE OF PROPRIETARY FUND DEBT SERVICE REQUIREMENTS 25 SUPPLEMENTAL INFORMATION SCHEDULE OF RESTRICTED ASSETS 26 SCHEDULE OF RESERVED FUND EQUITIES 27 SCHEDULE OF INSURANCE COVERAGE 28 ENTERPRISE FUND # OF CUSTOMERS AND RATES 29 ANALYSIS OF PROPERTY TAXES 30 r William l_ Spore Company, Certified Public INDEPENDENT AUDITOR'S REPORT To the City Council City of Sanger, Texas We have audited the accompanying general purpose financial statements of the City of Sanger, Texas as of September 30, 1993, and for the year then ended, as listed in the table of contents. These general purpose financial statements are the responsibility of City of Sanger, Texas, management. Our responsibility is to express an opinion on these general purpose financial statements based upon our audit. We conducted our audit in accordance with generally accepted auditing standards, Governmental Auditing Standards, issued by the Comptroller General of the United States, and the provisions of the Office of Management and Budget Circular A-128, "Audits of State and Local Governments." Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall general purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Sanger, Texas, as of September 30, 1993, and the results of its operations and the cash flows of its proprietary fund types for the year then ended in conformity with generally accepted accounting principles. Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The combining and individual fund and account group financial statements and schedules listed in the table of contents are presented for purposes of additional analysis and are not a required part of the general purpose financial statement of the City of Sanger, Texas. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. William C. Spore & Company, P.C. Certified Public Accountants February 11, 1994 III ME 1600 Airport Freeway, Suite 208 • Bed ford, TX 76022 • 817/545-1040 ELECTED OFFICIALS MAYOR MAYOR PRO TEM COUNCILMEMBERS APPOINTED OFFICIALS CITY ADMINISTRATOR CITY SECRETARY, MUNICIPAL COURT JUDGE CITY ATTORNEY CITY OF BANGER CITY OFFICIALS September 30, 1993 Nel Armstrong Jerry Jenkins Margie Braxton Tommy Kincaid Russell Madden Jack Richardson John Hamilton Rosalie Chavez Danny Spindle Ronald Neiman SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 2 CITY OF SANGER COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS ASSETS Cash Receivables, Net of Allowances for Uncollectables: Property Taxes Nonproperty Taxes Services Other Inventory Prepaid Expenses Restricted Assets - Cash Property, Plant and Equipment Net of Accumulated Depreciation Amount to be Provided for Retirement of General Long -Term Debt TOTALASSETS LIABILITIES Accounts Payable Accrued Expenses Customer Deposits Deferred Revenues Long -Term Debt: Combensated Absences Notes Payable Revenue Bonds Payable Certificate of Obligation Payable Capital Leases TOTAL LIABILITIES FUND EQUITY Contributed Capital Investment in General Fixed Assets Retained Earning - Reserved Retained Earning - Unreserved Fund Balance - Reserved Fund Balance - Unreserved TOTAL FUND EQUITY TOTAL LIBILITIES AND FUND EQUITY September so, 1993 GENERAL 10,834 $ 51,015 10,704 0 54,845 0 0 4,124 0 0 ENTERPRISE 20,398 0 0 3201331 347 1111874 0 2611130 3,633,450 $ 131,522 $ 4,347,530 161,540 7,039 0 51,015 0 0 0 0 0 219,594 0 0 0 0 4,124 (92,196) (88,072) $ 144,593 71,362 60,575 0 0 0 2,310,000 0 115,480 21702,010 100,196 0 249,697 11295,627 0 0 196459520 $ 131,522 $ 4,347,530 0 0 51,015 60,658 0 0 10,704 61,242 0 0 320,331 245,750 0 0 55,192 21650 0 0 111,874 78,801 0 0 0 21627 0 0 265,254 963,697 1,512,443 0 5,145,893 4,400,849 0 495,394 495,394 559,700 $ 11512,443 $ 495,394 $ 61486,889 $ 61486,631 $ 0 $ 0 $ 306,133 193,278 0 0 78,401 102,122 0 0 60,575 582675 0 0 51,015 60,658 0 12,800 12,800 91700 0 182,896 182,896 175,000 0 0 21310,000 2,3801000 0 295,000 295,000 375,000 0 4,698 120,178 72,225 0 4951394 31416,998 3,426,658 0 0 100,196 100,196 11512,443 0 11512,443 1,247,062 0 0 249,697 268,014 0 0 11295,627 11337,544 0 0 41124 99,539 0 0 (92,196) 71618 11512,443 0 31069,891 31059,973 $ 1,512,443 $ 495,394 $ 61486,889 $ 61486,631 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 3 CITY OF SANGER COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GENERAL FUND REVENUES Property Taxes Nonproperty Taxes Penalties and Interest on Deliquent Taxes License and Permits Fees and Services Grants and Intergovernmental Interest Income Miscellaneous Income Donations TOTAL REVENUES For the Year Ended September 3o, 1993 1993 1992 $ 326,015 $ 340,502 223,715 196,222 8,062 8,510 201775 91382 1851805 173,791 1631691 31,422 39365 4,058 51041 20,161 21480 15,018 9381949 799,066 EXPENDITURES General Government 361,719 336,920 Public Safety 304,383 371,109 Hiways and Streets 441,588 358,610 Health and Welfare 11,091 10,941 Culture and Recreation 71,647 62,208 Capital Outlay 280,381 108,715 Debt Service: Principal 256,232 103,297 Interest 36,662 35,494 TOTAL EXPENDITURES 11763,703 11387,294 EXCESS REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES) Proceeds of Notes Payable Transfers In TOTAL OTHER FINANCING SOURCES (USES) EXCESS OF REVENUES AND OTHER SOURCES OVER EXPENDITURES FUND BALANCE -BEGINNING (824,754) (588,228) 188,826 440,699 175,000 441, 012 629,525 616,012 (1951229) 27,784 1071157 79,373 FUND BALANCE -ENDING $ (881072) $ 107,157 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 4 CITY OF SANGER COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GENERAL FUND For the Year Ended September so, 1993 REVENUES BUDGET ACTUAL VARIANCE Property Taxes $ 319,421 $ 326,015 $ 6,594 Nonproperty Taxes 198,000 223,715 25,715 Penalties and Interest on Deliquent Taxes 11,000 81062 (21938) License and Permits 11,900 20,775 81875 Fees and Services 177,600 185,805 81205 Grants and Intergovernmental 30,918 163,691 132,773 Interest Income 31500 31365 (135) Miscellaneous Income 17,000 51041 (11,959) Donations 0 21480 21480 TOTAL REVENUES 769,339 938,949 16%610 EXPENDITURES General Government 346,171 361,719 (15,548) Public Safety 314,021 304,383 91638 Hiways and Streets 103,365 441,588 (338,223) Health and Welfare 11,466 11,091 375 Culture and Recreation 90,822 71,647 19,175 Capital Outlay 80,540 280,381 (199,841) Debt Service: Principal 255,000 256,232 (11232) Interest 28,700 36,662 (71962) TOTAL EXPENDITURES 11230,085 11763,703 (533,618) EXCESS REVENUES OVER (UNDER) EXPENDITURES (460,746) (824,754) (364,008) OTHER FINANCING SOURCES (USES) Proceeds of Notes Payable 0 188,826 188,826 Transfers In 460,746 440,699 (20,047) TOTAL OTHER FINANCING SOURCES (USES) EXCESS OF REVENUES AND OTHER SOURCES OVER EXPENDITURES $ FUND BALANCE -BEGINNING FUND BALANCE -ENDING 460,746 629,525 0 (195,229) $ 107,157 $ (88,072) 168,779 (195,229) SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 5 CITY OF SANGER COMBINED STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN RETAINED EARNINGS - PROPRIETARY FUND For the Year Ended September 30, 1993 1993 OPERATING REVENUES Charges and Fees $ 2,834,347 $ OPERATING EXPENSES Personnel Services 518,128 Purchase of Services 15455,922 Materials and Supplies 67,224 Depreciation 205,102 Franchise Fees 62,233 TOTAL OPERATING EXPENSES 2,308,609 OPERATING INCOME 525,738 NONOPERATING REVENUES (EXPENSES) Interest Income Debt Service Interest, Fees & Discounts Loss on Advance Refunding of Bonds Transfers Out TOTAL NONOPERATING REVENUES (EXPENSES) NET INCOME RETAINED EARNINGS -BEGINNING RETAINED EARNIN- GS ENDING 1992 2,495,739 526,731 1,372,538 71,121 195,172 57,091 2,222,653 273,086 16,315 52,135 (161,588) (228,507) 0 (103,994) (440,699) (441,012) (585,972) (721,378) (60,234) (448,292) 1,605,558 2,053,850 $ 1,545,324 $ 1,605,558 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED CITY OF SANGER COMBINED STATEMENT OF CASH FLOWS - ALL PROPRIETARY FUND TYPES For the Year Ended September 3o, 1993 1993 1992 CASH FLOWS FROM OPERATING ACTIVITIES: Cash Received from Customers $ 21761,666 $ 21534,073 Cash Payments to Suppliers for Goods and Services (1,603,799) (1,495,629) Cash Payments for Employees Services (538,236) (514,161) NET CASH PROVIDED BY OPERATING ACTIVITIES 619,631 524,283 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES: Acquisition of Capital Assets (684,765) (4389608) Additions to Long -Term Debt 70,369 21313,333 Principal Paid on Bonds and Notes (97,114) (11426,032) Interest Paid on Bonds and Notes (162,954) (220,206) Cash Transfered to Other Funds (440,699) (441,012) NET CASH USED FOR CAPITAL AND RELATED FINANCING ACTIVITIES (11315,163) (212,525) CASH FLOWS FROM INVESTING ACTIVITIES: Interest on Investments 18,618 51,621 NET INCREASE (DECREASE) IN CASH (676,914) 363,379 CASH - BEGINNING OF YEAR 958,442 595,063 CASH - END OF YEAR $ 281,528 $ 958,442 RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES: Operating Income $ 525,738 $ 273,086 Adjustment to Reconcile Operating Income to Net Cash Provided by Operating Activities: Depreciation 205,102 195,172 (Increase) Decrease in Receivables (74,581) 43,203 (Increase) in Inventory & Prepaid Expenses (30,446) (252164) Increase (Decrease) in Accounts Payable 11,290 30,464 Increase (Decrease) in Accrued Expenses (19,372) 12,391 Increase (Decrease) in Customer Deposits 11900 (41869) NET CASH PROVIDED BY OPERATING ACTIVITIES $ 619,631 $ 524,283 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 7 CITY OF SANGER NOTES TO FINANCIAL STATEMENTS September 30, 1993 NOTE A: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Sanger operates under a Council -Mayor government, following the laws of a General Law City as the State of Texas. The City provides the following public safety police, fire and ambulance, parks, sanitation, a public library senior center, community general administrative services along with water, electrical services. form of def fined by services: streets, center and sewer and The accounting policies of the City conform to generally accepted accounting principles as applicable to governments. The following is a summary of the more significant policies. 1. REPORTING ENTITY: The City, for financial reporting purposes, includes all of the funds and account groups relevant to the City of Sanger. The financial statements presented herein do not include agencies which have been formed under applicable state laws or separate and distinct units of government apart from the City of Sanger. There are no separately administered organizations that are controlled or dependent on the City. 2. FUND ACCOUNTING: The accounts of the City are organized on the basis of funds or account groups, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for by providing a separate set of self -balancing accounts which are comprised of each fund's assets, liabilities, fund equity, revenues and expenditures or expenses, as appropriate. Governmental resources are allocated to and for individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The various funds are grouped, in the financial statements in this report, into two generic fund types and two broad fund categories as follows. GOVERNMENTAL FUND TYPES General Fund The general fund is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund. CITY OF SANGER NOTES TO FINANCIAL STATEMENTS September 30, 1993 PROPRIETARY FUND TYPES Enterprise Funds Enterprise funds are used to account for operations (a) that are financed and operated in a manor similar to private business enterprises - where the intent of the governing body is that costs (expenses, including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges or (b) where the governing body has decided that periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. 3. PROPERTY, PLANT AND EQUIPMENT AND LONG-TERM LIABILITIES: The accounting and reporting treatment applied to property plant and equipment and long-term liabilities associated with a fund are determined by its measurement focus. All governmental fund types are accounted for on a "financial flow" measurement focus. This means that only current assets and current liabilities are generally included on their balance sheets. Their reported fund balance is considered a measure of "available spendable resources". Governmental fund operating statements present increases (revenue and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of "available spendable resources" during a period. Plant, property and equipment used in governmental fund type oDOerations are accounted for in the General Fixed Assets Account Group, rather than in governmental funds. No depreciation has been provided on such property, plant and equipment. All property, plant and equipment are valued at historical cost or estimated historical cost if actual cost is not available. Donated property, plant and equipment are valued at their estimated fair value on the date donated. Public domain "infrastructure" certain improvements other general fixed assets consisting of Long-term liabilities expected to be financed from governmental fund types are accounted for in the General Long -Term Debt Account Group, not in the governmental funds. The two account groups are not "funds". They are concerned only with the measurement of financial position. They are not involved with measurement of results of operations. Page - 9 CITY OF SANGER NOTES TO FINANCIAL STATEMENTS September 30, 1993 Special reporting treatments are applied to governmental fund prepaid expenses to indicate that they do not represent "available spendable resources", even though they are a component of net current assets. Such amounts are generally offset by fund balance reserve accounts. Because of their spending measurement focus, expenditure recognition for governmental fund types is limited to exclude amounts represented by non -current liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities. They are instead reported as liabilities in the General Long -Term Debt Account Group. All proprietary funds are accounted for on a cost of services or "capital maintenance" measurement focus. This means that all assets and liabilities (whether current or noncurrent) associated with their activity are included on their balance sheets. Their report fund equity (net total assets) is segregated into contributed capital and retained earnings components. Depreciation is provided in the proprietary funds in amounts sufficient to relate the cost of the depreciable assets, to operations over their estimated service lives on the straight-line basis. The service lives by type are as follows: Electric System 20 to 50 years Water and sewer system 10 to 50 years Furniture and Equipment 3 to 10 years 4. BASIS OF ACCOUNTING: Basis of accounting refers to when revenues and expenditures or expenses 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. All governmental funds are accounted for using the modified accrual basis of accounting. Their revenues are recognized when they become measurable and available as net current assets. Gross receipts and sales taxes are considered "measurable" when in the hands of intermediary collecting governments and are recognized as revenues at that time. All major revenues are susceptible to accrual. Expenditures are generally recognized under the modified basis of accounting when the related fund liability is incurred. Exceptions to this general rule include accumulated unpaid vacation and sick time which are not accrued and principal and interest on general Long-term debt which is recognized when due. Page - 10 CITY OF SANGER NOTES TO FINANCIAL STATEMENTS September 30, 1993 All proprietary funds are accounted for using the accrual basis of accounting. Their revenues are recognized when they are earned, and their expenses are recognized when they are incurred. 5. BUDGETS AND BUDGETARY ACCOUNTING: The City follows these procedures in establishing the budgetary data reflected in the financial statements: A: Prior to July 1, the City Manager submits to the City Council a proposed operating budget for the fiscal year commencing the following October 1. The operating budget includes proposed expenditures and the means of financing them. B: Public hearings are conducted to obtain taxpayer comments. C: Prior to October 1, the budget is legally enacted through the passage of an ordinance. D: The City Manager is authorized to transfer budgeted amounts between departments within any fund; any revisions that alter the total expenditures of any fund must be approved by the City Council. E: Budgets for the General and Proprietary Funds are adopted on a basis consistent with generally accepted accounting principles (GAAP). F: Unused appropriations for all of the above annually budgeted funds lapse at the end of the fiscal year. At year-end the City's cash accounts totalled $296,486 of which $296,386 was held in checking, savings or certificate of deposit accounts at a local bank. Of the Bank balances, $139,034 was covered by federal depository insurance and the remaining $157,352 was covered by collateral held by the pledging Bank's agent in the name of the City. There were no uncollateralized cash accounts. The securities pledged by the City's depository institution are as follows: SECURITY PAR TREASURY NOTE 11300,000 FNMA 100,000 FMV 1,478,344 103,281 $1,581,625 Page - 11 CITY OF SANGER NOTES TO FINANCIAL STATEMENTS September 30, 1993 7: INVENTORIES: Inventories of the Enterprise Fund are valued at the lower of cost (first -in, first -out) or market. 8. ACCUMULATED COMPENSATED ABSENCES: It is the CitI policy to permit employees to accumulate a limited amount of earned but unused vacation and sick time, which will be paid to employees upon separation from the City's service. In governmental funds, the cost of vacation and sick leave is recognized when paid. A long-term liability of $12,800 of accrued vacation and sick leave has been recorded in the General Long -Term Debt Account Group, representing the City's commitment to fund such costs from future operations. Proprietary funds accrue vacation leave in the period they are earned. 9. REVENUE RECOGNITION - PROPERTY TAXES: Property taxes attach as an enforceable lien on property as of January 1. Taxes are levied on October 1 and are due and payable at that time. All unpaid taxed levied October 1 become delinquent February 1 of the following year. Property tax revenues are recognized when they become available. Delinquent taxes are considered fully collectable and, therefore, no allowance for doubtful taxes is provided. 10. ALLOWANCE FOR UNCOLLECTIBLE ACCOUNTS: Allowance for uncollectible accounts receivable in the Proprietary Fund at September 30, 1993 is $37,390. 11. TOTAL COLUMNS ON COMBINED STATEMENTS: Total columns on the Combined Statements are captioned "memorandum only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or changes in financial position in conformity with generally accepted accounting principles. Neither is such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. NOTE B: RETIREMENT PLANS: Firemen's Pension Fund: The City's firemen are covered by the firemen's pension plan. This contributory plan is operated as part of the State Firemen's Relief Page - 12 CITY OF SANGER NOTES TO FINANCIAL STATEMENTS September 30, 1993 and Retirement Funds. The pension expense for the year ended September 30, 1993 was $3,410. Employee Retirement Plan: The City belongs to the Texas Municipal Retirement System, a retirement and disability pension system for municipal employees in the State of Texas. The plan is administered in accordance with the Texas Municipal Retirement System Act and is governed by a Board of Trustees appointed by the governor of the State of Texas. The City has elected to have monthly contributions from the City's employees in the amount of 5% of their gross earnings with the City providing a monthly contribution of 4.25% of the monthly gross earnings. Employee contributions are tax deferred and not subject to federal income tax until they are withdrawn. The City's contributions for the fiscal year totalled $30,755. NOTE C: LONG-TERM DEBT: The following is a summar future debt requirements these financial statements. General Long Term Debt: y of the City's Long -Term Debt. The are detailed in schedules included in Combination Tax and Utility System Junior Lien Revenue Certificates of Obligation, Series 1986 - Original amount of $700,000, principal paid annually on August 1; Interest paid semi-annually on February 1, and August 1, at rates ranging from 7.00 to 11.00%. The Bonds were issued for street improvements and are to be repaid from sales tax and property tax revenues and are further secured by a pledge of Enterprise Fund Net Revenues. The Certificates of Obligation require that certain reserve accounts be maintained as property taxes are collected. Note Payable to Gainesville National Bank - The note bears interest at 1% below prime rate and requires quarterly principal payments of $50,000 beginning December 15, 1993, with the balance due September 15, 1994. The note proceeds were used for street improvements. Capital Lease - Ford Motor Credit - Original balance of $9,500. The lease requires twenty four monthly rental payments of $273.54, with eighteen payments remaining at September 30, 1993. The City has a purchase option during the term of the lease to purchase the quipment at a designated purchase option pri ece. The City intends Page - 13 CITY OF SANGER NOTES TO FINANCIAL STATEMENTS September 30, 1993 Proprietary Fund: Texas Utility System Revenue Bonds, Series 1976 - Original amount of $305,000, principal paid annually on May 15; Interest paid semi-annually on May 15, and November 15, at rates ranging from 5.50 to 7.25%. The Bonds were issued for improvements to and extension of the City's Waterworks, Sewer and Electric Systems and are to be repaid from and secured by the Enterprise Fund Net Revenues. Texas Utility System Refunding and Improvement Revenue Bonds, Series 1991 - Original amount of $2,230,000, principal paid annually on May 15, Interest paid semi-annually on May 15 and November 15, at rates ranging from 4.70% to 7.15%. The bonds were issued to provide funds sufficient to refund all of the City's outstanding Series 1976, 1977, and 1985 Bonds plus an additional $800,000 for improvements to the City's Waterworks System. The refunding of the Bonds provided for lower future debt service requirements due to reduced interest rates. The Bonds are to be repaid from and are secured by the Enterprise Fund Net Revenues. The Bond Obligations require that certain cash reserve accounts be maintained. Capital Lease - Kansas State Bank - Original balance of $83,333. The lease requires forty eight monthly rental payments of $2,002,39, with twenty nine payments remaining at September 30, 1993. The City has a purchase option during the term of the lease to purchase the equipment at a designated purchase option price. The City intends to exercise this option at the end of the lease term. The proceeds of the lease were used to purchase a Digger Derrick unit. The equipment is security for the lease. Capital Lease - Case Credit Corporation - Original balance of $381750. The lease requires forty eight monthly rental payments of $939,74, with forty four payments remaining at September 30, 1993. The City has a purchase option during the term of the lease to purchase the equipment at a designated purchase option price. The City intends to exercise this option at the end of the lease term. The proceeds of the lease were used to purchase a trencher. The equipment is security for the lease. Capital Lease - Ford Motor Credit - Original balance of $31,618. The lease requires forty eight monthly rental payments of $752.73, with forty payments remaining at September 30, 1993. The City has a purchase option during the term of the lease to purchase the Page - 14 CITY OF SANGER NOTES TO FINANCIAL STATEMENTS September 30, 1993 NOTE D: DEBT SERVICE REQUIREMENTS NEXT FIVE YEARS: Debt service requirements for each of the next five years are as follows: General Fund: Proprietary Fund: Year Principal Interest Principal Interest 1994 $275,981 $ 32,242 $ 111,886 $ 159,235 1995 101,613 16,178 119,757 152,319 1996 105,000 81400 1131570 145,152 1997 --- --- 95,267 139,073 1998 --- --- 90,000 134,050 Future --- --- 11895,000 1,040,276 Total $482,594 $ 56,820 $2,425,480 $1,770,105 NOTE E: PRIOR -YEAR DEFEASANCE OF DEBT: In 1992, the City defeased its Series 1985 Revenue Bonds by placing the proceeds of new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in the City's financial statements On September 301 1993, $765,000 of bonds outstanding are considered defeased. NOTE F: PURCHASE COMMITMENT: On January 7, 1985 the City entered into a ten year contract with the Brazoz Electric Power Cooperative, Inc, whereby the City purchases electric power and energy at agreed upon rates, subject to a fuel adjustment charge and power adjustment on demand and energy charges. Power purchased for the current fiscal year totaled $1,215,622. NOTE G: INTERFUND RECEIVABLE AND PAYABLE: Permanent transfers were made to clear all interfund receivables and payables occurring during the year. The receivable and payables result from one fund paying an expenditure for another fund. Page - 15 COMBINING AND INDIVIDUAL FUND AN D ACCOU NT G ROU P STATEMENTS AND SCHEDULES CITY OF SANGER COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GENERAL FUND For the Year Ended September au, 199a REVENUES Property Taxes Nonproperty Taxes Penalties and Interest on Deliquent Taxes License and Permits Fees and Services Grants and Intergovernmental Interest Income Miscellaneous Income Donations TOTAL REVENUES EXPENDITURES General Government Public Safety Hiways and Streets Health and Welfare Culture and Recreation Capital Outlay Debt Service: Principal Interest TOTAL EXPENDITURES EXCESS REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES) Proceeds of Notes Payable Transfers In TOTAL OTHER FINANCING SOURCES (USES) EXCESS OF REVENUES AND OTHER SOURCES OVER EXPENDITURES $ FUND BALANCE -BEGINNING FUND BALANCE -ENDING 3261015 $ 0 $ 0 $ 0 97,221 0 0 0 81062 0 0 0 51850 10,151 0 0 0 0 20,612 0 0 0 0 31,701 750 0 49 0 41173 0 0 0 0 0 11150 0 442,071 10,151 21,811 31,701 137,495 42,357 0 0 0 0 254,090 50,293 0 0 0 0 11,091 0 0 0 0 0 0 0 51787 0 12,695 17,891 0 0 0 0 0 0 0 0 154,373 42,357 266,785 68,184 287,698 (32,206) (244,974) (36,483) 0 0 0 0 440,699 0 0 0 440,699 0 0 0 728,397 $ (32,206) $ (244,974) $ (36,483) SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 16 $ 0 $ 0 0 3,577 159,937 0 0 868 0 164,382 0 $ 126,494 0 0 0 28,419 875 0 0 155,788 181,867 0 0 0 0 441,588 0 0 0 0 0 18,774 0 256,232 0 36,662 181,867 753,256 0 1,197 0 5,318 0 0 0 6,515 0 0 0 28,305 14,018 0 0 42,323 0 0 0 0 0 0 1,330 1,330 0 0 5,256 98,253 1,691 0 0 105,200 0 0 0 0 0 0 0 326,015 223,715 8,062 20,775 185,805 163,691 3,365 5,041 2,480 0 938,949 0 0 0 361,719 0 0 0 304,383 0 0 0 441,588 0 0 0 11,091 7,069 24,554 11,719 71,647 41353 203,293 31570 280,381 0 0 0 256,232 0 0 0 36,662 11,422 227,847 15,289 1,763,703 (17,485) (597,468) (35,808) (10,092) (122,647) (15,289)= 0 188,826 0 0 0 188,826 0 0 C�] 0 0 0 0 0 0 0 0 (824,754) 188,826 440,699 629,525 (195,229) 107,157 $ (88,072) SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 16 CITY OF SANGER COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GENERAL FUND For the Year Ended September 30, 1993 REVENUES I BUDGET ACTUAL VARIANCE Property Taxes $ 319,421 $ 326,015 $ 6,594 Nonproperty Taxes 90,000 97,221 7,221 Penalties and Interest on Deliquent Taxes 11,000 81062 (21938) License and Permits 11200 51850 41650 Fees and Services 0 0 0 Grants and Intergovernmental 0 0 0 Interest Income 31500 750 (21750) Miscellaneous Income 17,000 41173 (12,827) Donations 0 0 0 TOTAL REVENUES 442,121 4421071 (50) EXPENDITURES General Government 147,987 137,495 10,492 Public Safety 0 0 0 Hiways and Streets 0 0 0 Health and Welfare 11,466 11,091 375 Culture and Recreation 41500 0 41500 Capital Outlay 61800 51787 11013 Debt Service: Principal 0 0 0 Interest 0 0 0 TOTAL EXPENDITURES 170,753 154 7373 16,380 EXCESS REVENUES OVER (UNDER) EXPENDITURES 271,368 287,698 16,330 OTHER FINANCING SOURCES (USES) Proceeds of Notes Payable 0 0 0 Transfers In 460t746 440,699 (20,047) TOTAL OTHER FINANCING SOURCES (USES) 460,746 440,699 (20,047) EXCESS OF REVENUES AND OTHER SOURCES OVER EXPENDITURES $ 732,114 $ 728,397 $ (31717) SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 17 BUDGETI ACTUAL VARIANCE $ 0 $ 0 $ 0ma ma $ 0 0 7,500 0 0 0 0 0 7F'1LiIl 0 10,151 0 0 0 0 0 10,151 0 2,651 0 0 0 0 0 2,651 BUDGET I I ACTUAL 0 0 15,400 0 0 0 0 15,400 0 0 20,612 0 49 0 1,150 21, 811 VARIANCE 0 0 0 51212 0 49 0 1,150 6,411 38,804 42,357 (3,553) 0 0 0 0 0 0 264,899 254,090 10,809 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 31750 0 31750 14,000 12,695 11305 0 0 0 0 0 0 0 0 0 0 0 0 421554 42,357 197 278,899 266,785 12,114 (35,054) (32,206) 0 0 U 0 0 �7 2,848 0 0 0 (263,499) (244,974) 0 0 C�7 18,525 C 2,848 $ (263,499) $ (244,974) $ 18,525 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page — 17 CITY OF SANGER COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GENERAL FUND For the Year Ended September 30, 1993 REVENUES I ACTUAL I VARIANCE Property Taxes $ 0 $ 0 $ 0 Nonproperty Taxes 0 0 0 Penalties and Interest on Deliquent Taxes 0 0 0 License and Permits 0 0 0 Fees and Services 0 0 0 Grants and Intergovernmental 18,100 31,701 13,601 Interest Income 0 0 0 Miscellaneous Income 0 0 0 Donations 0 0 0 TOTAL REVENUES 18,100 31,701 13,601 EXPENDITURES General Government 0 0 0 Public Safety 49,122 50,293 (1,171) Hiways and Streets 0 0 0 Health and Welfare 0 0 0 Culture and Recreation 0 0 0 Capital Outlay 15,500 17,891 (2,391) Debt Service: Principal 0 0 0 Interest 0 0 0 TOTAL EXPENDITURES 64,622 68,184 (31562) EXCESS REVENUES OVER (UNDER) EXPENDITURES (46,522) (36,483) 10,039 OTHER FINANCING SOURCES (USES) Proceeds of Notes Payable 0 0 0 Transfers In 0 0 0 TOTAL OTHER FINANCING SOURCES (USES) 0 0 0 EXCESS OF REVENUES AND OTHER SOURCES OVER EXPENDITURES $ (46,522) $ (36,483) $ 10,039 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 17 BUDGET ACTUAL I VARIAN I BUDGET j I ACTUAL VARIANCE $ 0$ 0$ 0$ 0$ 0$ 0 0 0 0 108,000 126,494 18,494 0 0 0 0 0 0 3,200 31577 377 0 0 0 154,200 159,937 51737 0 0 0 0 0 0 0 28,419 28,419 0 0 0 0 875 875 0 868 868 0 0 0 0 0 0 0 0 0 157,400 164,382 61982 108,000 1559788 47,788 159,380 181,867 (22,487) 0 0 0 0 0 0 0 0 0 0 0 0 103,365 441,588 (338,223) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 24,500 18,774 51726 0 0 0 255,000 256,232 (11232) 0 0 0 28,700 36,662 (71962) 159,380 181,867 (22,487) 411,565 753,256 (341,691) (11980) (17,485) (15,505) (303,565) (597,468) (293,903) 0 0 0 0 188,826 188,826 0 0 0 0 0 0 0 0 0 0 188,826 188,826 $ (1,980) $ (17,485) $ (15,505) $ (303,565) $ (408,642) $ (105,077) SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 17 CITY OF SANGER COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GENERAL FUND For the Year Ended September 30, 1993 REVENUES Property Taxes Nonproperty Taxes Penalties and Interest on Deliquent Taxes License and Permits Fees and Services Grants and Intergovernmental Interest Income Miscellaneous Income Donations TOTAL REVENUES EXPENDITURES General Government Public Safety Hiways and Streets Health and Welfare Culture and Recreation Capital Outlay Debt Service: Principal Interest TOTAL EXPENDITURES EXCESS REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES) Proceeds of Notes Payable Transfers In TOTAL OTHER FINANCING SOURCES (USES) BUDGET I I ACTUALJ I VARIANCE $ 0 $ 0 $ 0 0 0 0 0 0 0 0 1,197 1,197 0 0 0 12,818 59318 (71500) 0 0 0 0 0 0 0 0 0 12,818 61515 (6,303) 0 0 0 0 0 0 0 0 0 0 0 0 39,042 28,305 10,737 91740 14,018 (41278) 0 0 0 0 0 0 48,782 42,323 61459 (35,964) (35,808) 156 0 0 0 0 0 0 0 0 0 EXCESS OF REVENUES AND OTHER SOURCES OVER EXPENDITURES $ (35,964) $ (35,808) $ 156 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 17 BUDGET ACTUAL VARIANCE BUDGET I ACTUAL VARIANCE $ 0$ 0$ 0$ 0$ 0$ 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 81000 51256 (21744) 0 0 0 0 98,253 98,253 0 0 0 0 11691 11691 0 0 0 0 0 0 0 1,330 11330 0 0 0 0 97,200 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 91482 71069 21413 24,873 24,554 319 41000 41353 (353) 0 203,293 (203,293) 0 0 0 0 0 0 0 0 0 0 0 0 133482 11,422 2,060 24,873 227,847 (202,974) (13,482) (10,092) 31390 (16,873) (122,647) (105,774) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1,330 11330 81000 105,200 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 17 CITY OF SANGER COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GENERAL FUND REVENUES Property Taxes Nonproperty Taxes Penalties and Interest on Deliquent Taxes License and Permits Fees and Services Grants and Intergovernmental Interest Income Miscellaneous Income Donations TOTAL REVENUES For the Year Ended September a0, 199a $ 0 0 0 EXPENDITURES General Government 0 Public Safety 0 Hiways and Streets 0 Health and Welfare 0 Culture and Recreation 12,925 Capital Outlay 21250 Debt Service: Principal 0 Interest 0 TOTAL EXPENDITURES 15,175 EXCESS REVENUES OVER (UNDER) EXPENDITURES (15,175) OTHER FINANCING SOURCES (USES) Proceeds of Notes Payable 0 Transfers In 0 TOTAL OTHER FINANCING SOURCES (USES) 0 $ 0 0 EXCESS OF REVENUES AND OTHER SOURCES OVER EXPENDITURES $ (15,175) $ FUND BALANCE -BEGINNING FUND BALANCE -ENDING 0 0 0 0 0 0 0 0 0 0 0 11,719 3,570 0 0 VARIANCE $ 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1,206 (1,320) 0 0 15,289 (114) (15,289) (114) u SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 17 BUDGET ACTUAL VARIANCE $ 319,421 $ 326,015 $ 61594 198,000 223,715 25,715 0 11,000 8,062 (2,938) 11,900 20,775 81875 177,600 185,805 81205 30,918 163,691 132,773 31500 31365 (135) 17,000 51041 (11,959) 0 21480 21480 769,339 938,949 169,610 346,171 314,021 103,365 11,466 90,822 80,540 255,000 28,700 11230,085 (460 t746) 0 460,746 460,746 0 361,719 (15,548) 304,383 9,638 441,588 (338,223) 11,091 375 71,647 19,175 280,381 (199,841) 256,232 (11232) 36,662 (71962) 11763,703 (533,618) (824,754) (364,008) 188,826 188,826 440,699 (20,047) 629,525 168,779 (195,229) $ (195,229) 107,157 $ (88,072) SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 17 Land Buildings Equipment Fire Equipment Swimming Pool Improvements INVESTMENT IN GENERAL FIXED ASSETS CITY OF SANGER STATEMENT OF GENERAL FIXED ASSETS For the Year Ending September 30, 1993 G� 71,870 1261395 4971262 1221985 2151293 4781638 $ 1,512,443 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED CITY OF SANGER SCHEDULE OF CHANGES IN GENERAL FIXED ASSETS For the Year Ending September 30, 1993 COST BEGINNING ADDITIONS DELETIONS ENDING Land $ 713870 $ 0 $ 0 $ 71,870 Buildings 126,395 0 0 126,395 Equipment 453,065 59,197 15,000 497,262 Fire Equipment 105,094 17,891 0 122,985 Swimming Pool 12,000 203,293 0 215,293 Improvements 478,638 0 0 478,638 INVESTMENT IN GENERAL FIXED ASSETS $ 11247,062 $ 280,381 $ 15,000 $ 11512,443 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 19 CITY OF SANGER SCHEDULE OF CHANGES IN PROPERTY, PLANT & EQUIPMENT ENTERPRISE FUND For the Year Ending September 30, 1993 BEGINNING I DELETIO I ENDING COST Water System $ 1,339,345 $ 549,068 $ 0 $ 1,888,413 Sewer System 11930,951 0 0 1,930,951 Electric System 1,609,613 37,474 0 11647,087 Equipment 320,163 90,681 0 410,844 Furniture & Fixtures 114,161 7,542 0 121,703 Building Improvements 14,623 0 0 14,623 Easement 11500 0 0 11500 TOTAL COST $ 5,330,356 $ 684,765 $ 0 $ 6,015,121 ACCUMULATED DEPRECIATION Water System $ 505,879 $ 58,271 $ 0 $ 564,150 Sewer System 534,785 53,017 0 587,802 Electric System 846,559 50,033 0 896,592 Equipment 176,777 39,765 0 216,542 Furniture & Fixtures 106,721 21553 0 109,274 Building Improvements 51848 11463 0 71311 Easement 0 0 0 0 TOTAL ACCUMULATED DEPRECIATION $ 2,176,569 $ 205,102 $ 0 $ 2,381,671 NET PROPERTY, PLANT & EQUIPMENT $ 31153,787 $ 31633,450 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 20 CITY OF SANGER STATEMENT OF GENERAL LONG - TERM DEBT September 30, 1993 Series 1986 Certificates of Obligation NOTES PAYABLE Note Payable -Gainesville National Bank CAPITAL LEASES Ford Motor Credit ACCRUED COMPENSATED ABSENCES Accrued Vacation Pay Accrued Sick Pay TOTAL ACCRUED COMPENSATED ABSENCES TOTAL TO BE PROVIDED FOR RETIREMENT OF GENERAL LONG -TERM DEBT 4,300 8,500 $ 295,000 182,896 4,698 12,800 $ 495,394 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 21 CITY OF SANGER SCHEDULE OF CHANGES IN GENERAL LONG - TERM DEBT For the Year Ended September 30, 1993 1BEGINNING1 JADDITION7S IREDUCTIONS ENDING BOND OBLIGATIONS Series 1986 Certificates of Obligation $ 375,000 $ 0 $ NOTES PAYABLE Note Payable -Gainesville National Bank $ 175,000 $ Note Payable - Gainesville National Bank 0 TOTAL NOTES PAYABLE $ 175,000 $ CAPITAL LEASES Ford Motor Credit $ ACCRUED COMPENSATED ABSENCES Accrued Vacation Pay $ Accrued Sick Pay TOTAL ACCRUED COMPEN. ABSENCES $ 80,000 $ 295,000 175,000 $ 0 182,896 $ 175,000 $ 182,896 0 $ 5,930 $ 1,232 $ 4,698 4,600 $ 9,700 $ TOTAL TO BE PROVIDED FOR RETIREMENT OF GENERAL LONG -TERM DEBT $ 559,700 $ 0 $ 300 $ 4,300 3,400 0 8,500 3,400 $ 300 $ 12,800 192,226 $ 256,532 $ 495,394 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 22 CITY OF SANGER DEBT SERVICE REQUIREMENTS - GENERAL LONG-TERM DEBT September 30, 1993 Series 1986 Certificates of Obligation Year Ending September 30, PRINCIPAL 1994 $ 901000 $ 1995 100,000 1996 105,000 $ 295,000 $ INTEREST 22,900 $ 16,150 8,400 47,450 $ Note Payable - Gainseville National Bank Year Ending September 30, PRINCIPAL INTEREST TOTAL REQUIREMENTS 112,900 1161150 1131400 342,450 TOTAL REQUIREMENTS 1994 $ 182,896 $ 9,145 $ 192,041 $ 182,896 $ 91145 $ 192,041 Capital Lease - Ford Motor Company Year Ending TOTAL September 30, PRINCIPAL INTEREST REQUIREMENTS 1994 $ 3,085 $ 197 $ 3,282 1995 1,613 28 1,641 $ 41698 $ 225 $ 41923 Total Bond Obligations and Notes Payable Year Ending TOTAL September 30, PRINCIPAL INTEREST REQUIREMENTS 1994 $ 275,981 $ 32,242 $ 308,223 1995 101,613 16,178 117,791 1996 105,000 81400 113,400 $ 482,594 $ 56,820 $ 539,414 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 23 CITY OF SANGER SCHEDULE OF CHANGES IN LONG - TERM DEBT - ENTERPRISE FUND For the Year Ended September 30, 1993 REVENUE BOND OBLIGATIONS Series 1973 Series 1976 Series 1991 TOTAL REVENUE BONDS CAPITAL LEASES Kansas State Bank Case Credit Corporation Ford Motor Credit TOTAL CAPITAL LEASES TOTAL LONG -TERM DEBT BEGINNINGj JADDITIONS1REDUCTIO I ENDING $ 51000 $ 0 $ 160,000 0 21215,000 0 0 38,750 0 31,619 $ 2,452,225 $ 5,000 $ 0 50,000 110,000 15,000 2,2001000 70,000 $ 21310,000 19,265 $ 3,017 4,832 70,369 $ 27,114 $ 52,960 35,733 26,787 115,480 70,369 $ 97,114 $ 21425,480 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 24 CITY OF SANGER DEBT SERVICE REQUIREMENTS - ENTERPRISE FUND September 30, 1993 Series 1976 Revenue Bonds Year Ending TOTAL September 30, PRINCIPAL INTEREST REQUIREMENTS 1994 $ 55,000 $ 6,050 $ 61,050 1995 55,000 31025 58,025 $ 110,000 $ 91075 $ 119,075 Series 1991 Revenue Bonds Year Ending TOTAL September 30, PRINCIPAL INTEREST REQUIREMENTS 1994 $ 20,000 $ 145,732 $ 165,732 1995 25,000 144,712 169,712 1996 85,000 143,400 228,400 1997 85,000 138,810 223,810 1998 90,000 134,050 224,050 1999 100,000 128,830 228,830 2000 105,000 122,830 227,830 2001 110,000 116,372 226,372 2002 115,000 109,498 224,498 2003 125,000 102,138 227,138 2004 1305000 93,950 223,950 2005 140,000 85,240 225,240 2006 150,000 75,720 225,720 2007 160,000 65,370 225,370 2008 170,000 54,170 224,170 2009 185,000 42,186 227,186 2010 195,000 28,958 223,958 2011 210,000 15,014 225,014 $ 21200,000 $ 11746,980 $ 31946,980 Capital Lease - Kansas State Bank Year Ending TOTAL September 30, PRINCIPAL INTEREST REQUIREMENTS 1994 $ 20,761 $ 31268 $ 24,029 1995 22,372 1,657 24,029 1996 91827 185 10,012 $ 52,960 $ 51110 $ 58,070 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 25 CITY OF SANGER DEBT SERVICE REQUIREMENTS - ENTERPRISE FUND September 30, 1993 Capital Lease - Case Credit Corporation Year Ending September 30, 1994 1995 1996 1997 PRINCIPAL $ 8,733 9,459 10,244 7,297 $ 35,733 Capital Lease -Ford Motor Credit TOTAL INTEREST REQUIREMENTS $ 21544 $ 11,277 11818 11,277 1,033 11,277 221 7,518 $ 51616 $ 41,349 Year Ending TOTAL September 30, PRINCIPAL INTEREST REQUIREMENTS 1994 $ 71392 $ 11641 $ 91033 1995 71926 11107 91033 1996 81499 534 91033 1997 21970 42 31012 $ 26,787 $ 31324 $ 30,111 (TOTAL ALL DEBT Year Ending TOTAL September 30, PRINCIPAL INTEREST REQUIREMENTS 1994 $ 111,886 $ 159,235 $ 271,121 1995 119,757 152,319 272,076 1996 113,570 145,152 258,722 1997 95,267 139,073 234,340 1998 90,000 134,050 224,050 1999 100,000 128,830 228,830 2000 105,000 122,830 227,830 2001 110,000 116,372 226,372 2002 115,000 109,498 224,498 2003 125,000 102,138 227,138 2004 130,000 93,950 223,950 2005 140,000 85,240 225,240 2006 150,000 75,720 225,720 2007 160,000 65,370 225,370 2008 170,000 54,170 224,170 2009 185,000 42,186 227,186 2010 195,000 28,958 223,958 2011 210,000 15,014 225,014 $ 21425,480 $ 11770,105 $ 41195,585 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 25 SUPPLEMENTAL INFORMATION CITY OF SANGER GOVERNMENTAL AND PROPRIETARY FUNDS SCHEDULE OF RESTRICTED CASH September 30, 1993 GENERAL FUND Swimming Pool Funds Police Department Funds TOTALGENERALFUND ENTERPRISE FUND Revenue Bond I & S Funds Revenue Bond Reserve Funds Customer Utility Deposits TOTAL ENTERPRISE FUND $ 2,515 1,609 $ 6,003 243, 694 $ 261,130 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 26 CITY OF SANGER GOVERNMENTAL AND PROPRIETARY FUNDS SCHEDULE OF RESERVED FUND EQUITIES September 30, 1993 GENERAL FUND Swimming Pool Funds Police Department Funds TOTAL GENERAL FUND ENTERPRISE FUND Minimum Required Reserves, Interest and Sinking Funds - Revenue Bonds TOTAL ENTERPRISE FUND 249,697 $ 249,697 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 27 TYPE OF COVERAGE Business Auto. Liability Physical Damage Property Damage Workmen's Compensation Liability - Law Enforcement Liability Public Officials Liability General Liability Mobile Equipment CITY OF SANGER SCHEDULE OF INSURANCE COVERAGE September 30, 1993 AMOUNT OF FROM TO COVERAGE FCARRIER 10/1 /92 10/1 /93 3,000,000 Texas Municipal League 10/1/92 10/1/93 Scheduled Equip. Texas Municipal League 345,503 10/1/92 10/1/93 Scheduled Equip. Texas Municipal League 11538,500 10/1 /92 10/1 /92 10/1/93 Statutory Texas Municipal League 10/1/93 1,000,000 Texas Municipal League 10/1/93 11000,000 Texas Municipal League 10/1/93 3,0001000 Texas Municipal League 10/1/93 68,550 Texas Municipal League SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 28 CLASSIFICATION OF CUSTOMERS Residential Commercial, Demand & City CITY OF SANGER PROPRIETARY FUND SUPPLEMENTAL INFORMATION September 30, 1993 WATER 1,298 205 NUMBER OF CONNECTIONS 1,503 RESIDENTIAL WATER RATES & COMMERCIAL Deposit $ 25.00 First 1,000 Gallons (minimum) $ 10.00 11000 TO 5,000 Gallons $ 1.80 51000 TO 15,000 Gallons $ 2.00 151000 TO 30,000 Gallons $ 2.40 Over 30,000 Gallons $ 3.20 SEWER RATES First 1,000 Gallons (minimum) Over 1,000 Gallons Maximum ELECTRIC RATES Deposit Facility Charge Energy Charge Demand Charge. First 6 KWH (minimum) Over 6KWH RESIDENTIAL ELECTRIC 1,418 283 COMMERCIAL $ 10.00 $ 16.00 $ 25.00 $ 125.00 SMALL RESIDENTIAL COMMERCIAL SEWER 1, 334 133 LARGE COMMERCIAL $ 50.00 $ 100.00 $ 100.00 $ 9.00/Month $ 11.50/Month $ -- $ .0599161/kwh $ .0652494/kwh $ .022848/KWH GALLONS OF WATER METERED (APPROX.) 147,824,000 50.50 SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 29 CITY OF SANGER ANALYSIS OF TAXES RECEIVABLE For the Year Ended September 30, 1993 1992 Year Original Tax Roll Adjustments to Original Tax Roll ADJUSTED TAX ROLL Less: Collections and Adjustments CURRENT YEAR TAXES RECEIVABLE -END OF YEAR PRIOR YEAR TAXES RECEIVABLE -END OF YEAR TOTAL TAXES RECEIVABLE -END OF YEAR Assessed Value Tax Rate per $100 Percent of Current Taxes Collected to Billed $ 317,173 8,753 325,926 315,955 9,971 r 41,044 51, 015 70,346,419 0.4633 96.94% SEE ACCOUNTANT'S REPORT AND NOTES ATTACHED Page - 30 r WilliamC.Spore ♦ Company, Certified Public Accountants To the Honorable Mayor and City Council, City of Sanger, Texas In planning and performing our audit of the general purpose financial statements of the City of Sanger, Texas, for the year ended September 30, 1993, we considered its internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control structure. However, we noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under the standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure that, in our judgement, could adversely affect the City's ability to record, process, summarize, and report financial data consistent with the assertions of management in the financial statements. These reportable conditions are as follows with suggestions for system improvements: 1. Penalties related to unpaid electric service billings are deleted by the computer system which requires manual re -billing of the penalties each month. This process is time consuming and makes reconciling accounts receivables to the general ledger difficult. The system should be upgraded to include the penalties in the billings at month end and not require manually re -billing the penalties. The penalties should become part of the customer balance and included in all aging reports. 2. The system for tracking customer deposits should be computerized to allow for prompt month end reconcilement to the general ledger liability accounts and to the deposit bank accounts. The current system is done manually and is not always reconciled in a timely manner. 3. Customer deposit cash funds were used during the year to reduce cash flow problems related to the slow reimbursement of the swimming pool grant funds. The deposit liability cash accounts are restricted funds and should not be used for general operating needs of the City. Cash accounts equal to customer deposit liabilities should be maintained at all times. 4. Pre -numbered tickets should be used by the Police Department to allow for accountability of all tickets issued and the related 1600 Airport Freeway, Suite 208 • Bed ford, TX 76022 • 817/545-1040 fines. All ticket books should be accounted for and reconciled periodically. All outstanding tickets should be accounted for on a monthly basis and a numeric listing of all tickets written should be maintained as part of the court accounting system. A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to relatively low level the risk that errors or irregularities in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned duties. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we noted the following reportable condition that we believe to be a material weakness. Condition - The City's system of issuing credit memos related to utility billings does not allow for assurance that all credit memos are properly approved or accounted for. The internal control system should be designed to assure that all utility billings and related receivables are recorded in the City's financial records. Recommendation - Pre -numbered credit memos should be used and a tracking system to account for all credit memos should be established. This tracking system should also be used for making entries related to receivables and billings in the general ledger. Each credit memo should be approved by someone other than the billing clerk. City 's Response - Pre -numbered tickets are now in use and are being logged in a credit memo journal for use in reconciling to the general ledger. This report is intended solely for the information and use of the management, Mayor and City Council of the City of Sanger, Texas. Thank you, wOUAA. �..F� William C. Spore & Company, Certified Public Accountants February 11, 1994 Page - 2