HomeMy WebLinkAboutRes 06-11 Approving the Comprehensive Annual Financial Report Year Ending September 30, 2005TOWN OF WESTLAKE
RESOLUTION NO. 06-11
A RESOLUTION OF THE BOARD OF ALDERMEN OF THE TOWN OF WESTLAKE,
TEXAS, APPROVING THE FISCAL YEAR 2004/2005 ANNUAL AUDIT REPORT
FROM WEAVER & TIDWELL, LLP AND APPROVING A $5,000 BUDGET
AMENDMENT TO INCLUDE THE TEXAS STUDENT HOUSING FINANCIAL
INFORMATION IN THE TOWN OF WESTLAKE AUDIT.
WHEREAS, Section 103.001 of the Local Government Code requires that a municipality
shall have its records and accounts audited annually and shall have an annual financial statement
prepared based on the audit; and
WHEREAS, Section 103.002 of the Local Government Code requires that a municipality
shall employ at its own expense a certified public accountant who is licensed in this state or a
public accountant who holds a permit to practice from the Texas State Board of Public
Accountancy to conduct the audit and to prepare the annual financial statement; and
WHEREAS, the inclusion of the Texas Student Housing financial information was
required to be "discretely presented" as a component unit in the Town's 2004/2005 annual audit
because it was determined that the Board of Aldermen can appoint and/or remove a director of
the Texas Student Housing Board..
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE
TOWN OF WESTLAKE:
SECTION 1: That the Board of Aldermen does hereby approve the fiscal year 2004/2005
annual audit report from Weaver and Tidwell, LLP.
SECTION 2: That the Board of Aldermen does hereby approve the $5,000 budget
amendment necessary to include the Texas Student Housing financial information in the Town of
Westlake audit.
SECTION 3: That this Resolution shall become effective upon the date of its passage.
PASSED AND APPROVED ON THIS 27' DAY OF MARCH, 2006.
Scott Bradley, Mayor
ATTEST:
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Jon Dwinnell, Town Secretary
Trent O. Petty, To anager
TOWN OF WESTLAKE, TEXAS
FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2005
TOWN OF WESTLAKE, TEXAS
FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
Table of Contents
Independent Auditor's Report
1
Management's Discussion and Analysis
2
Basic Financial Statements:
Government -wide Financial Statements:
Statement of Net Assets
8
Statement of Activities
9
Fund Financial Statements:
Balance Sheet — Governmental Funds
11
Reconciliation of the Governmental Funds Balance
Sheet to the Statement of Net Assets
12
Statement of Revenues, Expenditures, and Changes in
Fund Balances — Governmental Funds
13
Reconciliation of the Statement of Revenues, Expenditures,
and Changes in Fund Balances of Governmental
Funds to the Statement of Activities
14
Statement of Net Assets — Proprietary Fund
15
Statement of Revenues, Expenses, and Changes in
Fund Net Assets — Proprietary Fund
16
Statement of Cash Flows — Proprietary Fund
17
Discretely Presented Component Units Financial Statements:
Discretely Presented Component Units- Combining
Statement of Net Assets
18
Discretely Presented Component Units- Combining
Statement of Activities
20
Notes to the Financial Statements
22
Required Supplementary Information:
Schedule of Revenues, Expenditures, and Changes in
Fund Balances — Budget and Actual — General Fund
45
Schedule of Revenues, Expenditures, and Changes in
Fund Balances — Budget and Actual —
Westlake Academy General Fund
46
Notes to Required Supplementary Information
47
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. 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, based on our audit and the report of other auditors, the financial statements referred to
above present fairly, in all material respects, the respective financial position of the governmental
activities, the business -type activities, each major fund and the aggregate discretely presented
component units of the Town of Westlake, Texas, as of September 30, 2005, 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.
INDEPENDENT AUDITOR'S REPORT
WEAVED
To the Honorable Mayor
12
and Board of Aldermen
TIDWELL
TOWN OF WESTLAKE, TEXAS
L. L. R
regarding the methods of measurement and presentation of the required supplementary information.
CERTIFIED PUBLIC
We have audited the accompanying financial statements of the governmental activities, the business -
ACCOUNTANTS
type activities, each major fund and the aggregate discretely presented component units of the Town of
AND CONSULTANTS
Westlake, Texas (the "Town"), as of and for the year ended September 30, 2005, which collectively
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comprise the Town's basic financial statements as listed in the table of contents. These financial
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statements are the responsibility of the Town of Westlake, Texas management, Our responsibility is to
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express opinions on these financial statements based on our audit. We did not audit the financial
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statements of Texas Student Housing Corporation — MSU Project and Texas Student Housing
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Authority — College Station Project, which represent 30%, 31%, and 37% respectively, of the assets,
net assets, and revenues of the aggregate discretely presented component units of the Town of
FORT WORTH
Westlake. Those financial statements were audited by other auditors whose report thereon has been
1600 lk'cs! ,5ercntb Street
furnished to us, and our opinion, insofar as it relates to the amounts included for Texas Student
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Housing Corporation — MSU Project and Texas Student Housing Authority — College Station Project, is
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based on the report of the other auditors.
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. 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, based on our audit and the report of other auditors, the financial statements referred to
above present fairly, in all material respects, the respective financial position of the governmental
activities, the business -type activities, each major fund and the aggregate discretely presented
component units of the Town of Westlake, Texas, as of September 30, 2005, 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.
The management's discussion and analysis and budgetary comparison information on pages 2 through
7 and 36 through 38 are not a required part of the basic financial statements but are supplementary
information required by accounting principles generally accepted in the United States of America. We
have applied certain limited procedures, which consisted principally of inquires of management
regarding the methods of measurement and presentation of the required supplementary information.
However, we did not audit the information and express no opinion on it.
DALLAS
In accordance with Government Auditing Standards, we have issued a report dated January 4, 2006,
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on our consideration of the Town's internal control over financial reporting and our tests of compliance
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with certain provisions of laws, regulations, contracts, rants and other matters. The purpose of that
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report is to describe the scope of our testing of internal control over financial reporting and compliance
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and the results of that testing, and not to provide an opinion on internal control over financial reporting
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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.
FORT WORTH
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81-..3.32.-905
WEAVER AND TIDWELL, L.L.P.
Fsr;. -w.�M6
4VWW.WEAVERANDTIDWELL.00M
Dallas, Texas
AN INOEPENOENT nnEMIRER OF
January4, 2006
BAKER TILLY
INTERNATIONAL
MANAGEMENT'S DISCUSSION AND ANALYSIS
The Town of Westlake is pleased to present this overview and analysis of the financial activities of the Town for the
fiscal year ended September 30, 2005. The Town implemented Governmental Accounting Standards Board
Statement 34, Basic Financial Statements – and Management's Discussion and Analysis -- for State and 'Local
Governments (Statement 34) for the first time for fiscal year 2004; therefore, comparative data is shown in various
tables within this report.
FINANCIAL HIGHLIGHTS
• The Assets of the Town exceeded its liabilities at the close of the most recent fiscal year by $16,362,812
(Net assets).
As of the close of the current fiscal year, the Town of Westlake's governmental funds reported combined
ending fund balances of $1,898,630, a decrease of $145,656 in comparison with the prior year.
• At the end of the current fiscal year, fund balance for the general fund was $937,426, a decrease of $62,647
in comparison with the prior year. This represents 25% of total general fund expenditures and is equivalent
to 93 operating days.
OVERVIEW OF THE FINANCIAL STATEMENTS
This overview is intended to serve as an introduction to the Town's basic financial statements. The Town's annual
report consists of three parts— management's discussion and analysis (this section), the basic financial statements,
and required supplementary information. The basic financial statements include statements that present different
views of the Town's overall financial health:
• The first two statements are government -wide financial statements that provide both long-term and short-
term information about the Town's overall financial status.
• The remaining statements are fund financial statements that focus on individual parts of the government,
reporting the Town's operations in more detail than the government -wide statements.
• The governmental funds statements tell how general government services were financed in the short term
as well as what remains for future spending.
The financial statements also include notes that explain some of the information in the financial statements and
provide more detailed data. The statements are followed by a section of required supplementary information that
further explains and supports the information in the financial statements.
Government -wide financial statements
The government -wide financial statements are designed to provide readers with a broad overview of the Town's
finances, in a manner similar to a private -sector business. The government -wide financial statements are prepared
utilizing the economic resources measurement focus and the accrual basis of accounting.
The statement of net assets presents information on all of the Town's assets and liabilities with the difference
between the two reported as net assets. Over time, increases or decreases in the Town's net assets serve as a
useful indicator of the long-term financial trends experienced by the Town. Other non-financial factors should also
be taken into consideration, such as changes in the condition of the Town's infrastructure (i.e. roads, drainage
improvements, etc.), to assess the overall financial condition.
The statement of activities presents information showing how the government's net assets changed during the most
recent fiscal year. All of the revenues and expenses are taken into account as soon as they occur, regardless of the
timing of related cash flows. Thus revenues and expenses are reported in this statement for some items that will
only be reflected in terms of cash flow in future fiscal periods.
The government -wide financial statements are prepared utilizing the economic resources measurement focus and
the accrual basis of accounting.
2
Town of Westlake, Texas
Management's Discussion and Analysis
Both of the government -wide financial statements distinguish functions of the Town that are principally supported by
sales taxes and intergovernmental revenues (governmental activities) from other functions that are intended to
recover all or a significant portion of their costs through user fees and charges (business -type activities). The
governmental activities of the Town include general government, public safety, culture and recreation, economic
development, public works, visitor services and education. The business -type activities of the Town include water
and sewer.
The government -wide financial statements include not only the Town (known as the primary government), but also
three discretely presented component units: the Lone Star Public Facility Corporation, 4A Economic Development
Corporation, and the 4B Economic Development Corporation. In addition, the Town has one blended component
unit, Westlake Academy, an open enrollment charter school owned and operated by the Town of Westlake.
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated
for specific activities or objectives. The Town, like other state and local governments, uses fund accounting to
ensure and demonstrate compliance with finance -related legal requirements. Below are the three types of funds.
The Town had only "Governmental funds and Propriety funds" for the year ended September 30, 2005.
Governmental funds - Governmental funds are used to account for essentially the same functions reported as
government activities in the government -wide financial statements. However, unlike the government -wide financial
statements, governmental fund financial statements focus on current sources and uses of spendable resources, as
well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful
in evaluating a government's near-term financial requirements.
Most of the Town's basic services are included in governmental funds, which focus on (1) how cash and other
financial assets that can readily be converted to cash flow in and out and (2) the balances left at year-end that are
available for spending. Consequently, the governmental fund statements provide a detailed short-term view that
helps you determine whether there are more or fewer financial resources that can be spent in the near future to
finance the Town's programs.
Because the focus of governmental funds is narrower than that of the government -wide financial statements, it is
useful to compare the information presented for governmental funds with similar information presented for
governmental activities in the government -wide financial statements. By doing so, the reader may better understand
the long-term impact of the government's near-term financing decisions. Both the governmental fund balance sheet
and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a
reconciliation to facilitate this comparison between governmental funds and governmental activities.
The Town maintains six 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
balances for the General, Visitor's Association, Westlake Academy General, Westlake Academy Special Revenue,
Capital Projects and Debt Service funds, all of which are presented as major funds.
The Town adopts an annual appropriated budget for its general fund. A budgetary comparison statement has been
provided for the general fund to demonstrate compliance with this budget
Proprietary funds - There are two types of Proprietary funds, Enterprise Funds and Internal Service Funds. The
Town maintains one type of proprietary fund — an enterprise fund. Enterprise funds are used to report the same
functions presented as business -type activities in the government -wide financial statements. The Town uses an
enterprise fund to account for its water and sewer activities. All activities associated with providing such services are
accounted for in this fund, including administration, operation, maintenance, debt service, capital improvements,
billing and collection. The Town's intent is that costs of providing the services to the general public on a continuing
basis is financed through user charges in a manner similar to a private enterprise. The Town has no Internal Service
Funds (fund to report activities that provide supplies and services for the Town's other programs and activities, i.e.
self insurance and fleet management.)
Fiduciary funds - Fiduciary funds are used to account for resources held for the benefit of parties outside the
government. Fiduciary funds are not reflected in the government -wide financial statements because the resources
of those funds are not available to support the Town's own programs. The accounting used for fiduciary funds is
Town of Westlake, Texas
Management's Discussion and Analysis
similar to the accounting used for proprietary funds. The Town of Westlake does not currently have any fiduciary
funds.
Notes to the financial statements. The notes provide additional information that is essential to a full understanding
of the data provided in the government -wide and fund financial statements.
GOVERNMENT -WIDE FINANCIAL ANALYSIS
The Town's combined net assets were $16,362,812 as of September 30, 2005. Analyzing the net assets and net
expenses of governmental and business -type activities separately, business -type activities' net assets are
$6,829,508 as can be seen in the following "Condensed Statement of Net Assets".
The largest portion of the Town's net assets, $16,426,691 reflects its investment in capital assets (e.g. land,
buildings, equipment, improvements, construction in progress, and infrastructure), less any debt used to acquire
capital assets still outstanding. The Town uses these capital assets to provide services to citizens; consequently,
these assets are not available for future spending. Although the Town's investment in its capital assets is reported
net of related debt, it should be noted that the resources needed to repay this debt may be provided from other
sources, since the capital assets themselves cannot be used to liquidate these liabilities.
Condensed Statement of Net Assets
Governmental
Activities
2005 2004
Business -like
Activities
2005 2004
Totals
2005 2004
Current and other assets
$ 2,712,381
$ 2,935,269
$ 1,047,661
$ 234,455
$ 3,760,042
$ 3,169,724
Capital assets
27,071,572
27,894,603
14,431,702
14,657,530
41,503,274
42,552,133
Total Assets
29,783,953
30,829,872
15,479,363
14,891,985
45,263,316
45,721,857
Long-term liabilities outstanding
18,726,329
19,113,943
5,878,381
5,931,254
24,604,710
25,045,197
Other liabilities
1,524,320
1,260,790
2,771,474
2,305,043
4,295,794
3,565,833
Total Liabilities
20,250,649
20,374,733
8,649,855
8,236,297
28,900,504
28,611,030
Net Assets:
Invested in capital assets,
net of related debt
7,975,910
9,064,603
8,450,781
8,118,139
16,426,691
17,202,742
Restricted
-
124,185
-
-
-
124,185
Unrestricted
1,557,394
1,246,351
(1,621,273)
(1,462,451)
63,879
216,100
Total Net Assets
$ 9,533,3D4
$10,455,139
$ 6,829,508
$ 6,655,688
$16,362,812
$17,110,827
Governmental activities: Governmental activities decreased the Town's net assets by $921,835. Significant
balances and transactions are as follows:
General Fund —The excess revenues over expenditures can be attributed primarily to the shortfall of
anticipated building permits and fees and fines and penalties as well as the unexpected liability of $140,000
related to the settlement of a protracted lawsuit involving annexation which began in 2002.
• Visitor's Association Fund — The Town's hotel occupancy tax decreased by $59,628; expenditures increased
by $236,410 which is mostly due to the approval of Marriott transportation and marketing funds,
development of the Town's website and the move of the Historical Society and Tree City from the General
Fund.
• Westlake Academy — General Fund — With the addition of the Kindergarten and the 7t'' grade, the
Academy's state funding increased by $602,081. Also, with the implementation of the Blacksmith Apprentice
Program, a $200,000 donation from the Westlake Academy Foundation was received during the fiscal year.
Expenditures increased by $511,044, which was primarily for the addition of new staff.
4
Town of Westlake, Texas
Management's Discussion and Analysis
Business -type activities: Business -type activities increased the Town's net assets by $135,705. Below are the
major components related to this increase:
• The increase in total revenues, approximately $891,000, is primarily due to the following:
• Fidelity's contribution of $370,551 for the construction of the Fidelity water -line
4 Additional $371,000 in water and sewer revenues from the change in the utility, rate structure with
consumption increase as a result of the increase in accounts and drought conditions
• TRA wastewater settle -up in the amount of $82,000 based on prior year flow projections
• Addition of new accounts that affected the water and sewer tap fees as well as our Fort Worth
impact fees constitutes the remaining $67,000
• The expenses increased by $257,840 of which $260,891 can be attributed to water purchases due to the
addition of customers which is offset by the revenue derived from the water billings.
Change in Net Assets
Expenses:
General government
Governmental
Business -like
- -
2,198,123
1,862,863
Activities
Activities
Totals
- -
1,592,962
2005
2004
2005 2004
2005
2004
Revenues:
3,622
Economic development
313,450
53,006
- -
Program revenues:
53,006
Public works
342,500
533,290
- -
Charges for services
$ 1,835,512
$ 1,557,245
$ 1,722,659 $ 1,200,660
$ 3,558,171 $
2,757,905
Operating grants and
80,935
Visitor services
448,604
172,542
- -
contributions
1,646,438
1,605,091
370,551 -
2,016,989
1,605,091
Capital grants and
1,655,212
Interest on long-term debt
1,028,104
1,012,982
- -
contributions
141,139
263,941
- -
141,139
263,941
General revenues:
1,702,081
Total expenses
$ 8,186,616
$ 6,978,623
$ 1,888,064 $ 1,702,081
Taxes
$ 8,680,704
Sales taxes
994,606
868,046
- -
994,606
868,046
Hotel occupancy taxes
381,221
440,849
- -
381,221
440,849
Mixed beverage taxes
13,846
10,511
- -
13,846
10,511
Franchise taxes
352,115
337,222
- -
352,115
337,222
Unrestricted grants
1,722,198
937,187
- -
1,722,198
937,187
Interest on investments
41,802
33,180
2,416 3,245
44,218
36,425
Miscellaneous
30,298
134,717
- -
30,298
134,717
Sale of Land
33,749
-
-
33,749
-
Transfers
71,857
-
(71,857) -
-
-
Total revenues
$ 7,264,781
$ 6,187,989
_
$ 2,023,769 $1,203,905
$ 9,288,550 $
7,391,894
Expenses:
General government
2,198,123
1,862,863
- -
2,198,123
1,862,863
Public safety
1,592,962
1,604,171
- -
1,592,962
1,604,171
Culture and recreation
96,617
3,622
- -
96,617
3,622
Economic development
313,450
53,006
- -
313,450
53,006
Public works
342,500
533,290
- -
342,500
533,290
Protective inspections
-
80,935
- -
-
80,935
Visitor services
448,604
172,542
- -
448,604
172,542
Education
2,166,256
1,655,212
- -
2,166,256
1,655,212
Interest on long-term debt
1,028,104
1,012,982
- -
1,028,104
1,012 982
Water and sewer
-
-
1,888,064 1,702,081
1,888,064
1,702,081
Total expenses
$ 8,186,616
$ 6,978,623
$ 1,888,064 $ 1,702,081
$ 10,074,680
$ 8,680,704
Change in net assets
(921,835)
(790,634)
135,705 (498,176)
(786,130)
(1,288,810)
Prior period adjustment
-
32,828
38,115 -
38,115
32,828
Net assets, beg. of year
10,455,139
11,212,945
6,655,688 7,153,864
17,110,827
18,366,809
Net assets, end of year
$ 9,533,304
$ 10,455,139
$ 6,829,508 $ 6,655,688
$ 16,362,812
$ 17,110,827
Town of Westlake, Texas
Management's Discussion and Analysis
FINANCIAL. ANALYSIS OF THE TOWN'S FUNDS
Govemmental funds. The focus of the Town's governmental funds is to provide information on near-term inflows,
outflows, and balances of spendable resources. Such information is useful in assessing the Town's financing
requirements. In particular, unreserved fund balance may serve as a useful measure of a Town's net resources
available for spending at the end of the fiscal year.
At the end of the current fiscal year, the Town's governmental funds reported combined ending fund balances of
$1,898,630, a decrease of $145,656 in comparison with the prior year. During the current year, the fund balance of
the Town's general fund decreased by $62,647. The key factor in this decrease was due to the unexpected liability
related to the settlement of a protracted lawsuit involving annexation, which began in 2002.
Proprietary funds. The Town's proprietary fund statements provide the same type of information found in the
government -wide financial statements but in more detail.
General Fund Budgetary Highlights
The General Fund budget was amended in total to decrease the $1,837,877 excess revenues over expenditures to
an excess of expenditures over revenue of $68,725. This amendment was primarily due to the postponement of a
large retailer to deliver a promised retail center in Westlake. This change resulted in the cancellation of development
and inspection fees of approximately $1,804,000 for the project. This amendment resulted in an overall decrease in
revenues totaling $1,984,006 as well as a decrease in total expenditures of $77,404 as can be seen on schedule on
page 45.
ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS
• In late .tune, First American Title announced its relocation to Solana. This $20 million renovation of 615,000
sq. ft. of office space in Campus Circle will accommodate up to 3,000 First American employees and will see
Campus Circle 1, 2, 3 and 4 linked by a four story sky bridge.
The FY 2005/2006 budget was adopted without provision for the large retail developments that have been
promised for years but never built. Expenditures will remain relatively static with the exception of an
increase in the debt service fund, which reflects the Town's first full payment of debt service for the Civic
Campus. The Board of Aldermen are expected to call an election in the Spring of 2006 which will dissolve
the 4A Economic Development 1/z cent sales tax and transfer the fund balance of approximately $1,700,000
to the General Fund. In order to maintain the same revenue flow from the half -cent, voters will also be asked
to approve a half -cent sales tax to reduce its property tax. Even though the Town has not levied a property
tax, the provision is legally available to the Town. Funds collected under the %Z cent reduction in property
tax are much less restricted in terms of their use than the '/2 cent funds collected under the 4A Economic
Development Corporation provision. These indicators were taken into account when adopting the general
fund budget for 2005.
The revenue budget has increased from the final 2005 budget of $3.46 million to $3.74 million, an
approximate $300 thousand increase. This anticipated increase is mostly due to additional sales tax
revenue and development fees.
Amounts available for appropriation in the general fund budget are $3.71 million, an increase of $200,000
from the final 2005 budget of $3.5 million. This increase is primarily made up of the following:
Approximately $28K for records management and codification
Increase in the Keller police contract of approximately $25K and an additional $50K related to the
utilization of part-time employees during the proposed FTO program
Increase in payroll of $32K in Municipal Court for the addition of a new warrant office and a
complete year of employment for the current warrant officer
Town of Westlake, Texas
Management's Discussion and .Analysis
Additional $65K related to facilities/ground maintenance. With the building being 3 years old,
various warranties are no longer in affect and the increase of student population and the utilization
of the building warrants additional repairs.
• Transfers in from the dissolution of 4A Economic Development Fund was budgeted at $1.8 million as well as
a transfer in of $85 thousand from the Utility Fund
• Transfers out relate to various capital projects including the civic campus expansion. A transfer has also
been budgeted to the Debt Service fund of $482 thousand to cover the shortfall of 4B Economic
Development funds appropriated for debt payment.
If these estimates are realized, the Town's budgetary general fund balance should increase by $1.02 million.
CONTACTING THE TOWN'S FINANCE DEPARTMENT
This financial report is designed to provide our citizens, customers, and investors and creditors with a general
overview of the Town's finances and to demonstrate the Town's accountability for the money it receives. If you have
questions about this report or need additional financial information, contact the Town's Finance Director, Debbie
Piper, at 817-490-5712.
7
TOWN OF WESTLAKE
STATEMENT OF NET ASSETS
SEPTEMBER 30, 2005
ASSETS
Cash and Cash Equivalents
Accounts Receivable (net of allowance)
Notes Receivable
Internal Balances
Due from Primary Government
Due from Component Units
Prepaid Items
Other Assets
Deferred Expenses
Restricted Assets:
Cash and Cash Equivalents
Capital Assets:
Land and Construction in Progress
Capital Assets, Net of Accumulated Depreciation
Debt issue costs, net of amortization
Total Assets and Other Debits
LIABILITIES AND NET ASSETS
LIABILITIES:
Accounts Payable
Due to Component Units
Due to Primary Government
Deposits
Accrued Interest Payable
Unearned Revenue
Noncurrent liabilities:
Due within one year
Due in more than one year
Total Liabilities
NET ASSETS:
Invested in Capital Assets, net of related debt
Restricted
Unrestricted
Total Net Assets
The accompanying notes are
an integral part of this statement.
Primary Government
Discretely
Governmental Business -type Presented
Activities Activities Total Component Units
$ 1,904,572
$ 255,540
$ 2,160,112 $
6,490,149
544,243
528,876
1,073,119
772,963
54,655
-
54,655
-
119,641
(126,580)
(6,939)
-
-
-
-
476,231
60,000
-
60,000
-
23,781
1,468
25,249
84,823
18,726,329
5,878,381
24,604,710
21,209
5,489
-
5,489
-
-
388,357
388,357
10,747,044
8,260,199
112,700
8,372,899
13,622,885
18,811,373
14,319,002
33,130,375
111,148,044
-
-
-
6,409,074
(2,743,610)
29,783,953
15,479,363
45,263,316
149,772,422
666,735
139,668
806,403
4,165,884
60,000
416,231
476,231
-
-
-
-
60,000
-
77,410
77,410
1,264
428,252
1,521,459
1,949,791
5,125,064
-
514,166
514,166
4,783,255
369,333
102,540
471,873
84,265,614
18,726,329
5,878,381
24,604,710
73,977,917
20,250,649
8,649,855
28,900,504
172,378,998
7,975,910
8,450,781
16,426,691
(28,143,544)
8,280,578
1,557,394
(1,621,273)
(63,879)
(2,743,610)
$ 9,533,304
$ 6,829,508
$ 16,362,812
$ (22,606,576)
0
TOWN OF WESTLAKE, TEXAS
STATEMENT OF ACTIVITIES
SEPTEMBER 30, 2005
Program Revenues
GENERAL REVENUES:
Taxes:
Sales Taxes
Hotel Occupancy Taxes
Mixed Beverage Taxes
Franchise Taxes
Unrestricted Grants
Interest Income
Miscellaneous
Sale of Land
Transfers
Total general revenues and transfers
Change in Net Assets
PRIOR PERIOD ADJUSTMENT
NET ASSETS, beginning of year
NET ASSETS, and of year
The accompanying notes are
an integral part of this statement 9
Charges for
Operating Grants
Capita[ Grants
Functions/Programs
Expenses
Services
and Contributions
and Contributions
Primary government:
Governmental Activities:
General Government
$ 2,162,365
$ 1,039,214
$ 135,895
$ -
Public Safety
1,592,962
45,213
27,706
-
Cultural and Recreational
96,617
-
Economic Development
349,208
-
119,263
-
Public Works
342,500
711,655
-
141,139
Visitor Services
448,604
-
_
Education
2,166,256
39,430
335,470
-
Interest on Long-term Debt
1,028,104
-
1,026,104
-
Total governmental activities
8,186,616
1,835,512
1,646,438
141,139
Business -type activities:
Water BSewer
1,888,064
1,722,659
370,551
Total business -type activities
1,888,064
1,722,659
370,551
-
Total primary government
$ 10,074,680
$ 3,558,171
$ 2,016,989
$ 141,139
Reported Discretely Presented
Component Units
$ 33,633,754
$ 16,598,473
$ 213,313
$ 1,635,690
GENERAL REVENUES:
Taxes:
Sales Taxes
Hotel Occupancy Taxes
Mixed Beverage Taxes
Franchise Taxes
Unrestricted Grants
Interest Income
Miscellaneous
Sale of Land
Transfers
Total general revenues and transfers
Change in Net Assets
PRIOR PERIOD ADJUSTMENT
NET ASSETS, beginning of year
NET ASSETS, and of year
The accompanying notes are
an integral part of this statement 9
Net (Expense) Revenue and
Changes in Net Assets
Primary Government
Discretely
Governmental Business - Type Presented
Activities Activities Total Component Units
(987,255) $
- $ (987,256) $ -
(1,520,043)
- (1,520,043) -
(96,617)
- (96,617) -
(229,945)
- (229,945) .
510,294
- 510,294
(448,604)
(44804) -
(1,791,356)
(1,791,356) -
(4,553,527) (4,563,527)
10
205,146
205,146
-
-
205,146
205,146
-
(4,563,527)
205,146
(4,358,3811
$ - $
$ - $
(15,186,278)
994,606
-
994,605
994,606
381,221
-
381,221
-
13,846
-
13,846
-
352,115
-
352,115
-
1,722,198
-
1,722,198
-
41,802
2,416
44,218
459,432
30,298
-
30,298
610,074
33,749
33,749
-
71,857
(71,857)
-
3,641,692
(69,441)
3,572,251
2,064,112
(921,835)
135,705
(786,130)
(13,122,166)
-
38,115
38,115
-
10,455,139
6,655,688
17,110,827
(9,484,410)
$ 9,533,304 $
6,829,508
$ 16,362,812 $
(22,606,576)
10
TOWN OF WESTLAKE
BALANCE SHEET
GOVERNMENTAL FUNDS
SEPTEMBER 30, 2005
LIABILITIES:
Liabilities:
Accounts payable $
489,283 $
22,136 $
Westlake
Westlake
666,735
Due to other funds
18,643
2,862
9,293 -
Academy
Academy
Debt
Total
-
- -
Visitor's
General
Special
Service Capital
Govermental
- -
General
Association
Fund
Revenue Fund
Fund Projects
Funds
ASSETS:
844,549
Fund Equity:
Cash and cash equivalents
$ 925,698
$ 771,233 $
206,901
$ 740 $
- $ - $
1,904,572
Receivables
-
779,244
- -
_ -
779,244
Reserved for court security
Accounts receivable
342,455
26,992
75,858
26,702
- 72,236
544,243
Notes receivable
54;655
-
-
-
- -
54,655
Due from other funds
131,796
987,729
-
-
- 18,643
150,439
Due from Component Unit
60,000
-
-
-
- -
60,000
Prepaid items
17,764
6,017
-
-
- -
23,781
Deferred Expenses
-
5,489
-
- -
5,489
TOTAL ASSETS
$ 1,532,368
$ 804,242 $
288,248
$ 27,442 $
- $ 90,879 $
2,743,179
LIABILITIES:
Liabilities:
Accounts payable $
489,283 $
22,136 $
46,864 $ 27,442 $
- $ 81,010 $
666,735
Due to other funds
18,643
2,862
9,293 -
- -
30,798
Due to component units
-
-
- -
- 60,000
60,000
Deferred revenue
67,016
-
- -
- -
87,016
Total liabilities
594,942
24,998
56,157 27,442
- 141,010
844,549
Fund Equity:
Fund balance
Reserved to promote tourism
-
779,244
- -
_ -
779,244
Reserved for court security
and technology
131,657
- -
- -
131,557
Unreserved and undesignated
805,769
-
232,091-
5( 0,131)
987,729
Total fund equity
937,426
779,244
232,091-
- 5( 0,131)
1,898,630
TOTAL LIABILITIES AND FUND EQUITI $
1,532,368 $
804,242 $
288,248 $ 27,442 $
- $ 90,879 $
2,743,179
The accompanying notes are
are an integral part of this statement. 11
TOWN OF WESTLAKE
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO
THE STATEMENT OF NET ASSETS
SEPTEMBER 30, 2005
Total fund balances -- governmental funds
Amounts reported for governmental activities in the statement of net assets
are different because:
Capital assets used in governmental activities are not financial resources
and therefore are not reported as assets in governmental funds.
Receivables for court fines are deferred at the fund level but are recognized
as revenues in the government wide statement of net assets.
Interest on long term debt is recognized when paid at the fund level but is
accrued when incurred in the government wide statement of net assets.
Long-term liabilities, including bonds payable, are not due and payable
in the current period and therefore are not reported at the fund level.
Total Net Assets - Governmental Activities
The accompanying notes are
are an integral part of this statement. 12
$ 1,898,630
27,071,572
87,416
(428,252)
19,095,662
TOWN OF WESTLAKE
STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
SEPTEMBER 30, 2005
The accompanying notes are
are an integral part of this statement. 13
Westlake
Westlake
Academy
Academy
Total
Visitor's
General
Special
Debt Capital
Governmental
General
Association
Fund
Revenue Fund
Service Fund Projects
Funds
REVENUES:
Taxes
Sales
$ 994,606 $ - $
$ - $
- $ $
994,606
Mixed beverage
13,846
-
-
- -
13,846
Hotel occupancy
-
381,221
-
-
-
381,221
Franchise
352,115
-
-
-
- -
352,115
State program revenues
-
-
1,589,848
7,514
- -
1,597,362
Federal program revenues
27,706
-
257,686
-
285,392
Interest income
21,469
20,301
-
-
- 16
41,786
Building permits and fees
740,027
-
-
_
_ _
740,027
Fines and penalties
1,007,142
-
-
-
- -
1,007,142
Contributions
35,758
-
-
-
1,028,104 260,402
1,324,264
Miscellaneous
40,839
9,801
242,050
-
- -
292,690
Total revenues
3,233,508
411,323
1,831,898
265,200
1,028,104 260,418
7,030,451
EXPENDITURES:
Current
General govemment and administration
1,716,269
-
-
-
- 526,893
2,243,162
Public safety
1,554,115
-
-
-
-
1,554,115
Cultural and recreational
96,617
_
_
-
96,617
Public works
112,764
-
-
-
-
112,764
Economic Development
35,758
-
-
-
-
35,758
Visitor services
-
448,604
-
-
- -
448,604
Education
-
-
1,612,198
265,200
- -
1,877,398
Capital outlay
164,607
2,000
-
-
- 97,074
263,681
Debt service
Interest and other fiscal charges
-
-
-
-
1,028,1 D4 -
1,D28,104
Total expenditures
3,680,130
450,604
1,612,198
265,200
1,028,104 623,967
7,660,203
Excess (deficiency) of revenues over expenditures
(446,622)
(39,281)
219,700
-
- 363,549
(629,752)
OTHER FINANCING SOURCES (USES)
Proceeds from sale of land
412,239
-
-
- -
412,239
Transfers in
71,873
-
-
-
- 100,137
172,010
Transfers out
(100,137)
-
-
(16)
(100,153)
Net other financing sources (uses)
383,975
-
-
-
- 100,121
484,096
Excess (deficiency) of revenues and other
sources over expenditures and other uses
(62,647)
(39,281)
219,700,
-
263428
{ }
(145,656)
Fund balances, at beginning of year
1,000,073
818,525
12,391
-
- 213,297
2,044,286
Fund balances at end of year
$ 937,426 $
779,244 $
232,091
$ $
(50,131 $
$ ��
1,898,630
The accompanying notes are
are an integral part of this statement. 13
TOWN OF WESTLAKE
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES OF GOVERMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
SEPTEMBER 30, 2005
Amounts reported for governmental activities in the statement of activities
are different because:
Net changes in fund balances - total governmental funds
Current year capital outlays are expenditures in the fund financial
statements, but are shown as increases in capital assets in the
government -wide financial statements.
Depreciation is not recognized as an expense in governmental funds since it
does not require the use of current financial resources. The effect of recording
the current year's depreciation is to decrease net assets
Revenues associated with court fines in the statement of activities are
reported on the accrual method and differ from amounts reported at the
fund level on the modified accrual basis.
The entirety of proceeds for sale of capital assets ($412,239) are shown as
other sources in the fund financial statements, but are offset by the remaining
book value ($378,490) to show the resulting gain in the govern ement-wide
financial statements.
Principal payments on tax reimbursement rates are shown as expenditures in
the fund financial statements, but are shown as a reduction of long-term
liabilities in the government -wide financial statements.
Change in net assets of governmental activities
The accompanying notes are
are an integral part of this statement. 14
$ (145,656)
289,602
(734,143)
28,571
(378,490)
18,281
$ (921,835)
TOWN OF WESTLAKE
STATEMENT OF NET ASSETS
PROPRIETARY FUND
SEPTEMBER 30, 2005
ASSETS:
Cash and cash equivalents
$
256,54.0
Accounts receivable
528,876
Prepaid items
1,468
Restricted cash and investments
388,357
Capital assets not being depreciated
112,700
Capital assets, net of accumulated depreciation and amortization
14,319,002
TOTAL ASSETS
$
15,605,943
LIABILITIES
Accounts payable
$
139,668
Due to component units
416,231
Accrued interest payable
1,521,459
Due to other funds
126,580
Unearned revenue
514,166
Current liabilities payable from restricted assets
Customer deposits payable
77,410
Noncurrent liabilities
Due within one year
102,540
Due in more than one year
5,878,381
TOTAL LIABILITIES
$
8,776,435
NET ASSETS
Invested in capital assets, net of related debt
$
8,450,781
Unrestricted
(1,621,273)
TOTAL NET ASSETS
$
6,829,508
The accompanying notes are
are an integral part of this statement. 15
TOWN OF W ESTLAKE
STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN NET ASSETS
SEPTEMBER 30, 2005
OPERATING REVENUES:
Charges for services $ 1,722,659
Contributions 370,551
2,093,210
OPERATING EXPENSES:
Payroll costs 126,036
Professional and contract services 63,308
Depreciation 413,060
Amortization of wastewater treatment rights 31,760
Water purchases 593,011
Other operating costs 188,437
Total operating expenses 1,415,612
Net operating income 677,598
NON-OPERATING REVENUES(EXPENSES):
Interest income 2,416
Interest expense (472,452)
income before transfers 207,562
Transfer (71,857)
Change in net assets 135,705
Total net assets, beginning of year 6,655,688
Prior Period Adjustment 38,115
Total net assets, end of year $ 6,829,508
The accompanying notes are
are an integral part of this statement. 16
TOWN OF WESTLAKE
STATEMENT OF CASH FLOWS
PROPRIETARY FUND
SEPTEMBER 30, 2005
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts from customers
$
1,835,223
Payments to employees
Depreciation and amortization
(126,036)
Payments to suppliers
(758,763)
Net cash provided by operating activities
Prepaid items
950,424
CASH FLOW FROM NONCAPITAL FINANCING
87,461
Customer deposits payable
ACTIVITIES:
Deferred revenue
85,246
Net interfund borrowings
$ 950,424
(249,231)
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:
Principal paid on debt
(46,466)
Interest paid on debt
(130,648)
Investment earnings
2,416
Purchase of property and equipment
(218,992)
Net cash used in capital and related financing activities
393,690)
Net increase in cash
and cash equivalents
307,503
Cash and cash equivalents at the
beginning of the year
336,394
Cash and cash equivalents at the
end of the year
$
643,897
RECONCILIATION OF TOTAL CASH AND CASH EQUIVALENTS:
Cash and cash equivalents
$
255,540
Restricted cash and cash equivalents
388,357
Total cash and cash equivalents
$
643,897
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES:
Operating income
$
677,598
Adjustments to reconcile operating loss to net
cash provided by operating activities:
Depreciation and amortization
444,820
Changes in operating assets and liabilities:
Receivables
(356,593)
Prepaid items
(1,468)
Accounts payable
87,461
Customer deposits payable
13,360
Deferred revenue
85,246
Net cash provided by operating activities
$ 950,424
The accompanying notes are
are an integral part of this statement. 17
TOWN OF WESTLAKE
DISCRETELY PRESENTED COMPONENT UNITS
COMBINING STATEMENT OF NET ASSETS
SEPTEMBER 30, 2005
ASSETS
Cash and cash equivalents
Accounts receivable (net of allowance)
Due from component units
Due from primary government
Prepaid items
Other assets
Restricted assets:
Cash and cash equivalents
Capital Assets:
Land and Construction in Progress
Capital Assets, net of accumulated depreciation
Debt issue costs, net of amortization
Total assets and other debits
LIABILITIES AND NET ASSETS
LIABILITIES:
Accounts payable and accrued expenses
Deposits
Due to component units
Due to primary government
Unearned revenue
Accrued interest payable
Noncurrent liabilities:
Due within one year
Due in more than one year
Total liabilities
NET ASSETS:
Invested in capital assets, net of related debt
Restricted for debt service
Unrestricted
Total net assets
The accompanying notes are
are an integral part of this statement.
Texas Student
Lone Star Westlake Westlake Housing Authority
Public Facility 4A 413 6allparkAustin
Corporation Corporation Corporation Project
$ 11,804 $ 1,305,126 $ 221,681 $ 571,169
63,357 63,357 20,182
13,398 - -
60,000 416,231 -
- - 35,987
11,804 1,441,881
3,000,448
4,788,265
23,673,014
3,167,749
701,269 35,256,814
- 867,761
- 13,398
60,000 -
- - 463,153
- 1,890,547
- 484,915
- 37,742,839
60,000 13,398 41,449,215
(6,598,726)
- 1,604,513
11,804 1,381,8131 687,871
$ 11,804 $ 1,381,881 $ 687,871 $ (6,792,401)
iK
Texas Student
Texas Student
Texas Student
Texas Student
Texas Student
69,836
4,165,884
Housing
Housing
Housing Authority
Housing
Housing Authority
-
1,264
Corporation - The
Corporation - The
Townlake
Corporation
College Station
Texas Student
13,398
Ridge at North Texas
Ridge at San Marcos
Austin Project
MSU Project
Project
Housing Authority
Total
$ 561,899
$ 66,562
$ 501,809
$ 312,320
$ 2,458,386
$ 479,393
$ 6,490,149
36,314
42,263
9,246
175,790
301,778
60,676
772,963
-
-
-
-
-
-
13,398
_
-
-
-
-
-
476,231
-
4,741
2,737
33,821
-
7,537
84,823
-
900
-
-
20,309
-
21,209
2,466,250
151,000
1,353,438
2,448,914
1,326,994
-
10,747,044
2,200,000
1,552,207
2,182,816
-
2,899,597
-
13,622,885
22,586,190
13,715,024
16,696,592
11,050,954
23,424,270
-
111,148,044
876,812
861,442
1,080,304
422,767
-
-
6,409,074
28,727,465
16,394,139
21,828,942
14,444,566
30,431,334
547,606
149,785,820
1,718,152
902,535
243,649
30,260
333,691
69,836
4,165,884
1,264
-
-
-
-
-
1,264
-
_
_
-
-
-
13,398
-
-
-
-
-
60,000
443,493
140,077
356,884
574,575
2,728,471
76,602
4,783,255
612,226
943,560
133,815
464,900
1,080,016
-
5,125,064
31,260,281
19,610,508
175,583
134,327
32,600,000
-
84,265;614
-
-
22,317,405
13,917,673
-
-
73,977,917
34,035,416
21,596,680
23,227,336
15,121,735
36,742,178
146,438
172,392,396
(5,597,279)
(3,481,835)
(2,531,276)
(2,578,279)
(7,356,149)
-
(28,143,544)
2,297,517
-
1,067,540
1,984,014
1,326,994
-
8,280,578
(2,008,189)
(1,720,706)
65,342
(82,904)
(281,689)
401,168
(2,743,610)
$ (5,307,951)
$ (5,202,541)
$ (1,398,394)
$ (677,169)
$ (6,310,844) $
401,168
$ (22,606,576)
19
TOWN OF WESTLAKE
DISCRETELY PRESENTED COMPONENT UNITS
COMBINING STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2005
Functions/Programs
Governmental Activities:
Lone Star Public Facility Corporati
Westlake 4A Corporation
Westlake 4B Corporation
Total governmental activities
Business -type activities:
Texas Student Housing Authority
Texas Student Housing Authority:
College Station Project
Ballpark Austin Project
Town Lake Austin Project
Texas Student Housing Corporatio
MSU Project
The Ridge at North Texas
The Ridge at San Marcos
Total business -type activities
Total primary government
Charges for
Expenses Services
Program Revenues
Operating Grants
and Contributions
Capital Grants
and Contributions
on $ - $ - $
155,978
1,028,634 - 213,313 -
1,184,612 - 213,313 -
484,455 504,189 - _
12,164,305 3,868,919 - 1,635,690
5,332,163 3,163,011
3,956,253 2,632,802
n:
1,966,778 1,556,660
4,969,363 2,905,894
3,575,825 1,966,998
32,449,142 16,598,473 - 1,635,690
$ 33,633,754 $ 16,598,473 $ 213,313 $ 1,635,690
GENERAL REVENUES:
Sales Taxes
Interest Income
Miscellaneous
Total general revenues
Change in Net Assets
NET ASSETS, beginning of year
NET ASSETS, end of year
The accompanying notes are
an integral part of this statement, 20
The accompanying notes are
an integral part of this statement, 20
Net (Expense) Revenue and
Changes in Net Assets
Governmental Business - Type
Activities Activities Total
(155,978)
(815, 321)
(971,299)
(155,978)
(815,321)
(971,299)
21
19,734
19,734
-
(6,659,696)
(6,659,696)
-
(2,169,152)
(2,169,152)
-
(1,323,459)
(1,323,451)
-
(410,118)
(410,118)
-
(2,063,469)
(2,063,469)
-
(1,608,827)
(1,6D8,827)
-
(14,214,979)
(14,214,979)
(971,299)
(14,214,979)
(15,186,278)
994,606
-
994,606
33,246
426,186
459,432
13,398
596,676
610,074
1,041,250
1,022,862
2,064,112
69,951
(13,192,117)
(93,122,166)
2,011,605
(11,496,015)
(9,464,410)
$ 2,081,556
$ (24,688,132)
$ (22,606,576)
21
I UVVIN Ut- VVtS I LANt=, I tAAS
NOTES TO THE FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies
General Statement
The Town of Westlake, Texas (the Town") was incorporated under the provisions of the laws of
the State of Texas on December 26, 1956. The Town operates under a Board -Manager form of
government and provides the following services as authorized by the laws of the State of Texas:
public safety; cultural and recreation; and economic development.
The accounting and reporting policies of the Town conform with 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 Industry Audit Guide entitled Audits of State and Local Governmental Units and by
the Financial Accounting Standards Board (when applicable). The Town 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 Town are
described below.
Financial Reporting Entity
The Town's basic financial statements include the accounts of the Town's financial reporting
entity, including the primary government, organizations for which the Town is financially
accountable and other organizations for which the nature and significance of their relationship
with the Town are such that exclusion would cause the Town's financial statement to be
misleading or incomplete. The criteria for including organizations as component units within the
Town's reporting entity, includes whether:
• the organization is legally separate (can sue and be sued in their own name);
• the Town holds the corporate powers of the organization;
• the Town appoints a voting majority of the organization's board;
• the Town is able to impose its will on the organization;
• the organization has the potential to impose a financial benefit/burden on the Town; and,
• there is fiscal dependency by the organization on the Town.
Component units are blended with the balances and transactions of the Town if one of the
following criterion are met:
= the component unit is substantially the same governing body as the Town; or
the component unit provides services entirely (or almost entirely) to the Town or benefits the
Town exclusively (or almost exclusively).
Based on the aforementioned criteria, the Town has the following component units: Lone Star
Public Facilities Corporation, Westlake 4A Corporation, Westlake 4B Corporation, Westlake
Academy, Texas Student Housing Corporation, Texas Student Housing Authority, Jefferson
Commons at the Ballpark project, Jefferson Commons at Town Lake Project, College Station
Cambridge Project, Texas Student Housing Corporation — Denton Project, Texas Student
Housing Corporation — San Marcos Project, and Texas Student Housing Corporation — MSU
Project.
22
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies — continued
Component Units
Discretely Presented
Lone Star Public Facilities Corporation is a Texas non-profit corporation that acts on behalf of
the Town to further the public purposes under the Public Facilities Corporation Act, as its'
duly constituted authority and instrumentality. The board of directors, appointed by the
Town's governing body, is comprised of seven members; of whom five must be members of
the Town's governing body.
Westlake 4A Corporation is a Texas non-profit industrial development corporation under the
Development Corporation Act of 1979 formed to promote economic development within the
Town and the State of Texas in order to eliminate unemployment and underemployment, and
to promote and encourage employment and the public welfare of, for, and on behalf of the
Town by using the proceeds of a sales and use tax for the promotion and development of
new and expanded business enterprises and any other lawful activities as defined and
permitted under Section 4A of the Act. The board of directors is composed of five persons
appointed by the Town's governing body; two of which are members of the Town's governing
board.
Westlake 4B Corporation is a Texas non-profit industrial corporation under the Development
Corporation Act of 1979 formed to promote economic development within the Town and the
State of Texas in order to eliminate unemployment and underemployment, and to promote
and encourage employment and the public welfare of, for, and on behalf of the Town by
developing, implementing, financing, and providing one or more projects defined and
permitted under Section 4B of the Act. The board of directors is composed of seven persons
appointed by the members of the Town's governing board. Four of the members of the board
of directors are members of the Town's governing board.
The Texas Student Housing Authority, Ballpark Austin Project, Town Lake Austin Project,
College Station Project, Texas Student Housing Corporation — The Ridge at North Texas
Project, Texas Student Housing Corporation — San Marcos Project, and Texas Student
Housing Corporation — MSU project (collectively, "Texas Student Housing") are Texas non-
profit organizations as a duly constituted authority of the Town pursuant to Section 53.35(b)
of the Texas Education Code, as amended (Act). Texas Student Housing's primary purpose
is to construct, own, and operate student housing facilities on college campuses in Texas.
The Board consists of seven directors which are appointed by the Town's governing body.
No members of the Board are members of the Town's governing body. The Texas Student
Housing entities are reported as enterprise funds. The Town is not responsible for the long
term debt of the Texas Student Housing entities. All Texas Student Housing entities have
separately issued financial statements. These statements can be obtained by contacting the
Texas Student Housing Authority.
The financial statements are formatted to allow the user to clearly distinguish between the
primary government and the discretely presented component units.
Blended
Westlake Academy ("Academy") is a Texas non-profit Corporation that acts on behalf of the
Town to acquire a charter, under Chapter 12, Subchapter D of the Education Code, provide
education services and acquire, finance, and operate educational facilities. The board
consists of seven directors and is appointed by the Town's governing body. Currently all the
members of the board of directors are members of the Town's governing body. The
Academy's year end is August 31.
23
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies — continued
Government -wide and Fund Financial Statements
The government -wide financial statements (i.e., the Statement of Net Assets and the Statement
of Changes in Net Assets) report information on all of the non -fiduciary activities of the Town. For
the most part, the effect of interfund activity has been removed from these statements. Govern-
mental activities, which normally are supported by taxes and intergovernmental revenues, are
reported separately from business -type activities, which rely to a significant extent on fees and
charges for support,
The statement of activities demonstrates the degree to which the direct expenses of a given
function or segment are offset by program revenues. Direct expenses are those that are clearly
identifiable with a specific function or segment. Program revenues include 1) charges to
customers or applicants who purchase, use, or directly benefit from goods, services, or privileges
provided by a given function or segment and 2) grants and contributions that are restricted to
meeting the operational or capital requirements of a particular function or segment. Taxes and
other items not properly included among program revenues are reported instead as general
revenues.
Separate financial statements are provided for governmental funds and proprietary funds. Major
individual governmental funds are reported as separate columns in the fund financial statements.
Measurement Focus, Basis of Accounting, and Financial Statement Presentation
The government -wide financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting, as are the proprietary fund financial
statements. Revenues are recorded when earned and expenses are recorded when a liability is
incurred, regardless of the timing of related cash flows. Grants and similar items are recognized
as revenue as soon as all eligibility requirements imposed by the provider have been met.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized as
soon as they are both measurable and available. Revenues are considered to be available when
they are collectible within the current period or soon enough thereafter to pay liabilities of the
current period. For this purpose, the Town considers revenues to be available if they are collected
within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a
liability is incurred, as under accrual accounting. However, debt service expenditures, as well as
expenditures related to compensated absences and claims and judgments, are recorded only
when payment is due.
Sales taxes, franchise taxes, licenses, and interest associated with the current fiscal period are all
considered to be susceptible to accrual and so have been recognized as revenues of the current
fiscal period. All other revenue items are considered to be measurable and available only when
cash is received by the Town.
The Town uses funds to report on its financial position and the results of its operations. Fund
accounting is designed to demonstrate legal compliance and to aid financial management by
segregating transactions related to certain government functions or activities. A fund is a.
separate accounting entity with a self -balancing set of accounts.
24
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies — continued
Measurement Focus, Basis of Accounting, and Financial Statement Presentation — continued
The Town reports the following major governmental funds:
General Fund — To account for all financial resources except those required to be
accounted for in another fund. The General Fund balance is available for any purpose,
provided it is expended or transferred in accordance with the legally adopted budget of
the Town.
Special Revenue Funds — To account for the proceeds of specific revenue sources (other
than special assessments, expendable trusts, or major capital projects) that are legally
restricted to expenditures for specified purposes.
Visitor's Association — To account for municipal hotel occupancy taxes collected and
expenditures to promote tourism and the convention and hotel industry.
Westlake Academy General Fund — To provide education services and acquire, finance,
and operate educational facilities.
Westlake Academy Special Revenue Fund — To account for the proceeds of federal and
state sources that provide education services.
Debt Service Fund — To account for resources accumulated and payments made for
principal and interest on long-term general obligation debt of governmental funds in a
debt service fund
Capital Projects Fund — To account for proceeds from long-term financing and revenue
and expenditures related to authorized construction and other capital asset acquisitions
and for the accumulation of resources for and the payment of general long-term debt
principal, interest and related costs..
Proprietary Fund Types
Proprietary funds are those used to account for the Town's ongoing organizations and
activities, which are similar to those found in the private sector. The measurement focus is
upon capital maintenance and upon determination of net income, financial position and
changes in financial position. The following are the proprietary fund types maintained by the
Town:
Enterprise Fund -- To account for revenues and expenses related to providing water and
sewer services to the general public on a continuing basis. Enterprise fund equity is
segregated into contributed capital and retained earnings.
Use of Estimates
The preparation of the basic financial statements in conformity with accounting principles
generally accepted in the United States of America requires the Town to make estimates and
assumptions that affect certain reported amounts and disclosures. Accordingly, actual results
may differ from those estimates.
Cash and Investments
Cash and cash investments of all funds, including restricted cash, are available upon demand
and are considered to be "cash equivalents".
25
TOWN OF W ESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies - continued
For purposes of the statement of cash flows, the Town considers highly -liquid investments
(including restricted assets) with an original maturity of three months or less when purchased to
be cash equivalents.
All investments are recorded at fair value based on quoted market prices. Fair value is the
amount at which a financial instrument could be exchanged in a current transaction between
willing parties.
Interfund Receivables and Payables
Short-term amounts owed between funds are classified as "due tolfrom other funds." Amounts
owed between funds payable in more than one year are classified as "advances to/from other
funds."
Fund Changes and Transactions Between Funds
Legally authorized transfers are treated as operating transfers and are included in the results of
operations of both governmental and proprietary funds.
The Town allocates to the Enterprise Funds an indirect cost percentage of the salaries and
wages and related costs of personnel who perform administrative services for those funds but are
paid through the general fund along with other indirect costs deemed necessary for their
operations.
Capital Assets
All fixed assets are valued at historical cost or estimated historical cost if actual historical cost
is not available. Donated assets are valued at their fair market value on the date donated.
Assets capitalized have an original cost of $5,000 or more and over three years of life.
Depreciation has been calculated on each class of depreciable property using the straight-
line method. Estimated useful lives are as follows:
Water and sewer system 10-50 years
Buildings 20-50 years
Machinery and equipment 4-10 years
Improvements 5-30 years
Compensated Absences
The Town's policy allows employees to earn 5 days of vacation and 5 days of sick leave after six
months of service and 10 days of vacation and 10 days of sick leave upon completion of a year of
service. After completion of five years of service, 15 days of vacation and 15 days of sick leave
per year are earned. After completion of ten years of service, 20 days of vacation and 20 days of
sick leave per year are earned. No accumulated, unused sick time or vacation is payable upon
termination or retirement.
Reserved and Designated Fund Equity
Reserved fund balances are not appropriable for expenditure or are legally segregated for a
specific future use. Designated fund balances are established to indicate tentative plans for
financial resources utilization in a future period.
26
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 2. Deposits and Investments
State statutes govern the Town's investment policies. Town funds are deposited in U.S. Federal
Deposit Insurance Corporation ("FDIC") insured banks located within the Town and in the State of
Texas Local Government Investment Pool ("TexPool"). Permissible investments include the
following:
1. Obligations of the U.S. or its agencies and instrumentalities;
2. Direct obligations of the State of Texas or its agencies;
Other obligations, the principal and interest of which are unconditionally guaranteed by
the State of Texas or the United States;
4. Obligations of states, agencies, counties, cities and other political subdivisions of any
state having been rated as to the investment quality by a nationally recognized
investment firm and having received a rating of not less than A or its equivalent;
5. Certificates of deposit issued by state and national banks domiciled in the State of Texas
that are guaranteed or insured by the FDIC or secured by other obligations that have a
market value of not less than the principal amount of the certificates; and,
6. Fully collateralized direct repurchase agreements having a defined termination date,
secured by direct obligations of the United States or its agencies and instrumentalities,
pledged with a third party selected or approved by the Town, and placed through a
primary government securities dealer, as defined by the Federal Reserve, or through a
bank domiciled in the State of Texas.
The Town did not engage in repurchase or reverse repurchase agreement transactions during the
current year.
During the year ended September 30, 2005, the Town had investments with TexPool. TexPool, a
public funds investment pool created by the Treasurer of the State of Texas acting by and through the
Texas Treasury Safekeeping Trust Company, which is empowered to invest funds and acts as
custodian of investments purchased with local investment funds. These investments are not required
to be categorized because the investor is not issued securities, but rather it owns an undivided
beneficial interest in the assets of the respective funds. The fair value of the position in TexPool is
the same as the value of the pool shares.
On September 1, 1989, local government investment pools became authorized investments for the
majority of public entities in Texas. The Interlocal Cooperation Act was amended by the 71St Texas
Legislature to facilitate the creation of local government investment pools in Texas. This act permits
the creation of investment pools to which a majority of political subdivisions (local governments) may
delegate, by contract, the authority to make investments purchased with local investment funds and
to hold legal title as custodian of the investments. TexPool was organized to conform with the
interlocal Cooperation Act, Chapter 791 of the Texas Government Code, and the Public Funds
Investment Act, Chapter 2256 of the Texas Government Code.
27
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 2. Deposits and Investments - continued
The Public Funds Investment Act (Government Code Chapter 2256) contains specific provisions in
the areas of investment practices, management reports and establishment of appropriate policies.
Among other things, it requires the Academy to adopt, implement, and publicize its investment policy.
That policy must address the following areas: (1) safety of principal and liquidity, (2) portfolio
diversification, (3) allowable investments, (4) acceptable risk levels, (5) expected rates of return, (6)
maximum allowable stated maturity of portfolio investments, (7) maximum average dollar — weighted
maturity allowed based on the stated maturity date for the portfolio, (8) investment staff quality and
capabilities, (9) and bid solicitation preferences for certificates of deposit. Statutes and the District's
investment policy authorized the District to invest in the following investments as summarized in the
table below:
Authorized Maximum Percentage Maximum Investment
Investment Type Maximum Maturity of Portfolio In One Issuer
Obligations of, or Guaranteed by
Governmental Entities
2 years
None
None
Certificates of Deposit
1 year
None
None
Mutual Funds
2 years
80%
None
Guaranteed Investment Contracts
-
None
None
Investment Pools
-
None
None
At September 30, 2005, the Town's investments included investment pools in the name of the Town
or its agent in the Town's name. The Town's investments were as follows:
Reconciliation of total cash and investments at September 30, 2005 are as follows:
Cash and cash equivalents $ 2,160,112
Restricted cash and investments 388,357
25484 9
The Town's entire cash deposits in the bank of $1,221,275 on September 30, 2005, were covered by
federal depository insurance or by collateral.
Weighted
Component Units
Carrying
Fair
Minimum
Rating as of
Primary Government
Amount
Value
Legal Rating
Year End
Investments:
Texpool
$ 1,538,611
$ 1,538,611
Texpool
$ 2,259,663
$ 2,259,663
NIA
AAA -m
Cash
288,806
288,806
NIA
NIA
Total cash and investments
12.548,4
_2_548,469
Reconciliation of total cash and investments at September 30, 2005 are as follows:
Cash and cash equivalents $ 2,160,112
Restricted cash and investments 388,357
25484 9
The Town's entire cash deposits in the bank of $1,221,275 on September 30, 2005, were covered by
federal depository insurance or by collateral.
Weighted
Component Units
Carrying
Fair
Average
Amount
Value
Maturi
Investments:
Texpool
$ 1,538,611
$ 1,538,611
6 months
Cash
4,951,538
4,951,538
n/a
$ 6,490,149
$ 6,490,149
28
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 2. Deposits and Investments - continued
Interest rate is the risk that changes in market interest rates will adversely affect the fair value of an
investment. Generally, the longer the maturity of an investment the greater the sensitivity of its fair
value of changes in market interest rates. One of the ways that the Town manages its exposure to
interest rate risk is by investing mainly in investment pools which purchase a combination of shorter
term investments with an average maturity of less than 29 days thus reducing the interest rate risk.
The Town monitors the interest rate risk inherent in its portfolio by measuring the weighted average
maturity of its portfolio. The Town has no specific limitations respect to this metric.
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder
of the investment. This is measured by the assignment of a rating by a nationally recognized
statistical rating organization. Presented above is the minimum rating required by (where applicable)
the Public Funds Investment Act, the Town's investment policy, or debt agreements, and the actual
rating as of year end for each investment type.
Note 3. Capital Assets
A summary of the changes in capital assets for the year ended September 30, 2005:
Beginning Decrease/ Ending
Balance increases Adjustment Transfers Balance
General Capital Assets
Land $ 8,482,936 $ 146,600 $ 378,490 $ - $ 8,251,046
Construction in Progress 41,652 9,153 - (41,652) 9,153
Total General Capital Assets Not Being Depreciated $ 8,524,588 $ 155,753 $ 378,490 $ (41,652) $ 8,260,199
Capital Assets, Being Depreciated:
Capital Improvements
Buildings
Machinery and equipment
Total Capital Assets; Being Depreciated
Less Accumulated Depreciation
$ 3,914,728 $ 2,000 $
15,950,709 87,921
1,862,784 43,928 _
21,728,221 133,849
2,358,206 734,143
$ 41,652 $ 3,958,380
- 16,038,630
- 1,906,712
41,652 21,903,722
3,092,349
Total General Capital Assets; Being Depreciated (net) $19,370,015 $ (600,294) $ - $ 41,652 $ 18,811,373
Business -type Activities
Construction in Progress
Capital Assets; Being Depreciated
Capital Improvements
Wastewater Treatment Rights
Machinery and Equipment
Total Capital Assets: Being Depreciated
Less Accumulated Depreciation
Total Capital Assets: Being Depreciated (net)
$ - $ 112,700 $ - $ - $ 112,700
$12,292,637 $ 84,974 $
635,199 -
3,346,424 21,318 _
16,274,260 106,292
$ - $ 12,377,611
635,199
3,367,742
16,380,552
1,616,730 444,820 - 2,061,550
$14,657530 $(338,528) $ $ - $ 14,319,002
Depreciation was charged to departments of the primary government as follows:
General Government $ 156,718
Public Safety 58,832
Public Works 229,736
Education 288,857
Total $ 734.143
We
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 3. Capital Assets - continued
A summary of discretely presented component units capital assets at September 30, 2005, follows:
30
Beginning
Ending
Balance
Additions Retirements
Balance
Ballpark Austin Project
Land
$ 4,788,265
$ - $ - $
4,788,255
Capital assets being depreciated:
Building
$ 21,345,305
$ - $ - $
21,345,305
Furniture and fixtures
6,993,063
- -
6,993,063
Total capital assets being depreciated
28,338,358
- -
28,338,368
Less accumulated depreciation:
3,392,310
1,273,044 -
4,665,354
Capital assets being depreciated, net
$ 24,946,058
$ (1,273,044) $ - $
23,673,014
The Ridge at North Texas
Land
$ 2,200,000
$ - $ - $
2,20D,000
Capital assets being depreciated:
Building
$25,705,DD0
$ - $ - $
25,705,000
Furniture and fixtures
1,253,849
-
1,253,841
Total capital assets being depreciated
26,958,841
-
26,958 841
Less accumulated depreciation:
3,324,414
1,048,237 -
4,372,651
Capital assets being depreciated, net
$ 23,634,427
$ (1,048,237) $ - $
22,586,190
The Ridge at San Marcos
Land
$ 1,552,207
$ - $ - $
1,552,207
Capital assets being depreciated:
Building
$15,875,143
$ - $ - $
15,875,143
Furniture and fixtures
818,332
- -
818,332
Total capital assets being depreciated
16,693,475
- -
16,693,475
Less accumulated depreciation:
2,332,872
645,579 -
2,978,451
Capital assets being depreciated, net
$ 14,360,603
$ (645,579) $ - $
13,715,024
Town Lake Austin Project
Land
$ 2,182,816
$ $ - $
2,182,816
Capital assets being depreciated:
Building
$16,954,671
$ 9,170 $ - $
16,963,841
Furniture and fixtures
1,211,085
-
1,211 085
Total capital assets being depreciated
18,165,756
9,170 -
18,174,926
Less accumulated depreciation:
738,164
738,170 -
1,476,334
Capital assets being depreciated, net
$17,427,592
$ (729,000) $ - $
16,698,592
30
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 3. Capital Assets - continued
Summary of discretely presented component units capital assets - continued:
MSU Project
Capital assets being depreciated:
Building
Furniture and fixtures
Total capital assets being depreciated
Less accumulated depreciation:
Capital assets being depreciated, net
College Station Project
Land
Beginning
Balance Additions Retirements
Ending
Balance
$11,300,714
$ - $
- $ 11,300,714
624,824
4,180
- 629,004
11,925,538
4,180
- 11,929,718
439,172
439,592
- 878,764
$11,486,366
$ {435,412) $
- $ 11,050,554
20,731
2008
$ -
$ 2,899,597 $
- $ 2,899,597
Capital assets being depreciated:
Building $
Furniture and fixtures _
Total capital assets being depreciated
Less accumulated depreciation:
Capital assets being depreciated, net
Note 4. Restricted Assets/Net Assets
Proprietary Fund
$ 27,727,646 $ - $ 27,727,646
2,591,427 - 2,591,427
30,319,073 - 30,319,073
6,894,803 - 6,894,803
$ - $ 23,424,270 $ - $ 23,424,270
Within the proprietary funds, $77,410 of the fund represents customer deposits received for water
and sewer usage that are refundable upon termination of service. The remaining balance of
$310,947 is to be used for specific water line construction.
Discretely Presented Component knits
Within the discretely presented component units, $10,747,044 in cash and cash equivalents
represents funds held for debt service.
Note 5. Interlocal Agreement with Trophy Club/Westlake Department of Public Safety
On April 24, 2000, the Town approved an interlocal agreement with the Trophy ClublWestlake
Department of Public Safety ("DPS"), which called for the Town of Westlake to participate in the
financing of an emergency vehicle for the DPS. The Town recorded a note receivable of $125,000
based on the terms of the interlocal agreement.
The Agreement calls for eight principal and interest payments to the Town, with interest calculated at
a stated rate of 6.75%. The schedule of future collections by the Town under this agreement, in each
of the next five fiscal years, is as follows:
Fiscal Year Ended
September 30,
_ Principal _
Interest
Total
2006
$ 17,042
$ 3,689
$ 20,731
2007
18,192
2,539
20,731
2008
19,421
_ _ _ 1,311
20,732
Total
$ 54.655
L 7,539
$.6 .2194
31
NOTES TO THE FINANCIAL STATEMENTS
Note 5. Interlocal Agreement with Trophy Club/Westlake Department of Public Safety - continued
Effective ,lune 1, 2002, the Trophy ClublWestlake Department of Public Safety was officially
dissolved. The Town of Trophy Club will continue to repay the remaining debt according to the terms
of the note.
Note 6. General Long -Term Debt
A summary of the changes in general long-term debt for the year ended September 30, 2005 follows:
Outstanding
Description Interest Rate Original Issue 1011104 Issued Retired
Combination Tax 8 Limited
Pledge Revenue Certificates of
Obligation. Series 2002
Combination Tax 8 Limited
Pledge Revenue Certificates of
Obligation, Series 2003
Fidelity Tax Reimbursement
5.75%-6.50% $ 12,400,D00 $ 12,4D0,000 $ - $
Outstanding Due within one
9130105 year
- $ 12,400,000 $ 210,000
2.0%-5.0% 5,410,000
6,410,000
- 6,410,D00
140,OD0
5.75% 536,374
303,943
18,281 285,662
19,333
$ 19,346,374
$ 19,113,943 $
$ 18,281 $ 19,D95,662 $
369,333
Debt service requirements of certificates of obligation to be retired from governmental funds are as
follows:
Fiscal Year Ended,
September 30,
2006
2007
2008
2009
2010
2011-2015
2016-2020
2021-2025
2026-2030
2039-2032
Principal
$ 350,000
370,D00
380,000
400,00D
420,000
2,425,000
3,075,000
3,930,000
5,050,000
2,410,000
$ 18,810,000
Interest
$ 1,027,804
1,011,354
993,249
974,059
953,309
4,402,290
3,656,488
2,733,251
1,535, 090
201,850
$ 17,488,744
Total
Requirements
$ 1,377,804
1,381,354
1,373,249
1,374,059
1,373,309
6,827,290
6,731,488
6,663,251
6,585,090
2,611,850
$ 36,298,744
On August 10, 1998 the Town entered into an economic development agreement with Fidelity Texas
Limited Partnership ("Fidelity") which provided that Fidelity will receive a rebate of one percent of local
sales taxes collected by the Town and paid by Fidelity. The agreement provided that the rebate will
be paid to Fidelity within thirty days of each calendar quarter from the sales taxes received by the
Town. On November 13, 2000, the agreement was amended to allow for a payment schedule of
fifteen annual equal installments for sales tax rebate due and payable to Fidelity. The amount due
will not bear interest. The loan is discounted to present value and amortized over the life of the loan
using the effective interest method.
32
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Mote 6. General Long -Term Debt - continued
Debt service requirements for deferred rebates to be retired from governmental funds are as follows:
Fiscal Year Ended
Total
September 30,
Principal
Interest
Requirements
2006
$ 19,333
$ 16,427
$ 35,760
2007
20,444
15,314
35,758
2008
21,620
14,138
35,758
2009
22,863
12,895
35,758
2010
24,178
11,580
35,758
2011-2015
143,410
35,380
178,790
2016
33,814
1,944
35,758
$ 285,662
$ 107,678
$ 393,340
The Certificates of Obligations, Series 2002 and 2003 require the Town to provide certain updated
financial information and operating data to certain information vendors annually, as permitted by SEC
Rule 15c2-12 (the "Rule"). The issuer will provide the updated information to each nationally
recognized municipal securities information repository (" NRh1ISIR") and to any state information
depository ("SID") that is designated by the State of Texas and approved by the staff of the United
States Securities and Exchange Commission (the "SEC").
Note 7. Proprietary Long -Term Debt
Elevated Water Storage Facility
On October 9, 2000, the Town approved an interlocal agreement with the City of Keller, which
provided for the joint construction, operation, maintenance and use of an elevated water storage
facility and appurtenances. The Town recorded a contractual obligation of $1,466,000 based on
the terms of the interlocal agreement, which requires 20 annual principal and interest payments to
the City of Keller, with payments due each September 30 at interest rates ranging from 5.0% to
5.65%.
Dove Road Water Line and West Pump Station
In April 2000, the Town approved an agreement with the Hillwood Development Corporation
("Hillwood"). In the agreement, Hillwood agreed to bear all initial costs for the design, engineering
and constructions of the Dove Road Water Line and the West Pump Station that will serve the
residents of the Town. The Town agreed to reimburse Hillwood for the cost of the project upon
completion and the Town's acceptance of the project, which occurred in June 2001, solely from a
$.25 charge per 1,000 gallons of usage. The Town further agreed to deposit debt service
revenue of $.25 per 1,000 gallons of usage collected from Town residents to fund its repayment
to Hillwood. Debt service revenue will be allocated between Hillwood service area and Town
service area by 52% and 48%, respectively and deposited into two separate debt service funds
that will result in debt service revenue to pay the respective share of the construction cost. The
Town recorded a limited pledge contractual obligation of $4,679,944 for the project cost based
upon the terms of the agreement, which requires 239 monthly principal and interest payments to
Hillwood, at an interest rate of 6.75%. If the Town collects insufficient funds to pay current
interest on the debt, the interest payment may be deferred. No portion of debt payments will be
applied to the principal component, until all current and deferred interest is fully paid.
33
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 7. Proprietary Long -Term Debt - continued
Proprietary long-term debt as of September 30, 2005 is as follows:
Outstanding Outstanding Current
Description 9130104 issued Retired 9130105 Portion
Contractual Obligations:
Elevated Water Storage $ 1,347,443 $ - $ 45,466 $ 1,300,977 $ 102,540
Limited Pledge Contractual
ONigation:
Dove Rd Water Line &
West Pump Station 4,679,944 - - 4,679,944
$ 6,027,367 $ S 46,456 $ 5,980,921 $ 102,540
The schedule of future payments by the Town under these agreements is as follows:
Fiscal Year Ended
Total
September 30,
Principal
Interest
Requirements
2006
$ 102,540
$ 2,015,735
$ 2,118,275
2007
56,082
520,918
577,000
2008
59,277
549,210
608,487
2009
64,082
579,210
643,292
2010
67,298
611,809
679,107
2011-2015
405,349
3,641,983
4,047,332
2016-2020
546,349
4,888,889
5,435,238
2021
4,679,944
772,340
5,452,284
$ 5,980,921
$ 13,580,094
$ 19,561,015
Note 8. Discretely Presented Long -Term Debt
College Station Project
The Project's installment note payable is summarized as follows:
Interest
Lender/Security/Due Date Rate Balance
Cambridge Student Housing Financing Company 8.00% $ 32,600,000
L.P.; collateralized by subatantially all assets and
assignment of rents; due November 1, 2039
The project's installment note is payable monthly with principal and interest
payments of $231,545 until November 1, 2039
The following is a summary of long-term debt transactions of the Project for the year ended August
31,2005:
Balance Balance Due Within
91112004 Increases Decreases 8131/2005 One Year
$ - $ 32,600,000 $ - $ 32,600,000 $ 32,600,000
34
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 8. Discretely Presented Long -Term Debt - continued
The Project's original Developer refinanced the installment note through a secondary offering with
Cambridge Student Housing Financing Company, L.P. The debt certificates were sold to private
investors in the following classes:
Class(Series) Offering Total
A $ 17,500,000
B 4,900,000
C 4,820,000
D 5,380,000
$ 32,600,000
Each class has certain rights and privileges, as contained in the private placement memorandum. As
a part of the offering, the Project entered into a Trust Agreement with J.P. Morgan Trust Company,
N.A. (the "Trustee") for the purpose of determining that each class is paid in accordance with the
private placement memorandum.
At August 31, 2005, the Project was not in compliance with the fixed charge coverage ratio, which
constitutes a default of the lending agreement. Upon default, the lender may accelerate the maturity
of the unpaid portion of the principal payable under the Installment Sale Agreement. However, the
Authority does not anticipate this event will occur, since foreclosure by private interests would result
in the loss of tax exempt status for the Project.
MSU Project
The long-term debt activity of the MSU Project is as follows:
Balance
9//12004
Series 2002
Revenue Bonds $ 14,540,000
Less Discounts 512,327
Balance Dee Within
Increases Decreases $13112005 One Year
$ - $ 14,540,000 $ 110,000
24,327 488,000 24,327
$ 14,027,673 $ - $ 24,327 $ 14,052,000 $ 134,327
The bonds are payable solely from the revenues generated by the Property and are secured by the
revenues pledged and assigned under the terms of the Trust Indenture. Interest rates range from
5.5% to 6.5%. Future payments on the bonds are as follows:
Year Ending August 31
Principal
Interest
Total
2006
$ 110,000
$ 926,775
$ 1,036,775
2007
145,000
919,763
1,064,763
2008
170,000
911,100
1,081,100
2009
200,000
900,925
1,100,925
2010
210,000
889,650
1,099,650
2011-2015
1,230,000
4,252,675
5,482,675
2016-2020
1,665,000
3,797,137
5,462,137
2021-2025
2,285,000
3,160,462
5,445,462
2026-2030
3,130,000
2,287,350
5,417,350
2031-2035
5,395,000
1,055,437
6,450,437
Total
$ 14,540,000
$ 19,101,274
$ 33,641,274
The bonds have numerous covenants which must be complied with annually. For the year ending
August 31, 2005, all of the covenants have been satisfactorily met, except the Fixed Changes
Coverage Ratio. Management does not believe this will impact the ability to continue to service the
bonds.
35
I VVVIN Vi- VVF_0I L/-Af\.C9 I L/\t- o
NOTES TO THE FINANCIAL STATEMENTS
Note 8. Discretely Presented Long -Term Debt — continued
Town Lake Austin Project
The long-term debt activity of the Town Lake Austin Project is as follows:
Balance
Interest
Balance
Due within
911/2004
Increases Decreases
8/3112005
One Year
Revenue Bonds
204,958
1,709,872
1,914, 830
2002 A-1 Bonds $18,206,175
$ $ (1,101,312)
$ 17,104,863
$ 175,583
2002 A-2 Bonds 5,388,125
- -
5,388,125
-
$23,594,300
$ - $ (1,101,312)
$22,492,988
$ 175,583
The bonds are payable solely from the revenues generated by the Project and are secured by the
revenues pledged and assigned under the terms of the Trust Indenture. Interest rates for the bonds
range from 7.76% to 8.69% at present and principal and interest payments are made monthly. The
future debt service requirements of the bonds are as follows:
Due Fiscal Year
Ending August 31
2006
2007
20D8
2009
2010
2011-2015
2016-2020
2021-2025
2026-2030
2031-2035
2036-2039
Total Debt Service
The Ridge at San Marcos
Principal
Interest
Total
$ 175,583
$ 1,739,247
$ 1,914,830
189,703
1,725,127
1,914,830
204,958
1,709,872
1,914, 830
221,441
1,693,389
1,914,830
239,248
1,675,582
1,914,B30
1,517,705
8,056,448
9,574,153
2,234,316
7,339,837
9,574,153
3,289,289
6,284,864
9,574,153
4,842,385
4,727,764
9,570,149
6,165,901
3,586,576
9,752,477
3,412,459
2,959,136
6,371,595
$ 22,492,968 $ 41,497,842 $ 63,990,830
The long-term debt activity of the Ridge at San Marcos is as follows:
Balance Balance Due within
9/1/2004 Increases Decreases 8/3112005 One Year
Revenue Bonds
2000 Bonds $ 19,632,280 $ - $ (21,772) $19,610,508 $19,610,508
$ 19,632,280 $ - $ (21,772) $19,610,508 $19,610,508
The bonds are payable solely from the revenues generated by the Project and are secured by the
revenues pledged and assigned under the terms of the Trust Indenture. The annual interest rate is
8.2% and interest is due on the first of each month. In the case of default under the terms of the
indenture, the interest rate increases by 2%. During 2005, the Project defaulted on the bonds and the
interest rate increased to 10.2%.
36
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 8. Discretely Presented Long -Term Debt -- continued
During 2005 the Project ceased making the required principal and interest payments required by the
Loan and Financing Agreement. This constitutes an event of default under provisions of the
indenture and permits the Trustee at the direction of the Servicing Agent to declare the principal and
all interest then due to be immediately due and payable. As a result, the outstanding principal at
August 31, 2005 has been shown as a current liability in the accompanying financial statements. In
addition, the Project was not in compliance with certain debt covenants as of August 31, 2005.
Ballpark Austin Project
The long-term debt activity of the Ballpark Austin Project is as follows:
Balance
91412004
Revenue Bonds
Balance Due within
Increases Decreases 8/3112005 One Year
2001A Bonds $ 33,450,000 $ - $ (495,000) $ 32,955,000 $ 515,000
2001B Bonds 2,425,000 - (30,000) 2,395,000 30,000
2001C Bonds 3,000,000 - - 3,000,000 -
Deferred Purchase Price 1,460,000 - - 1,460,000 -
Less Discounts (1,642,332) - 60,086 (1,582,246) (60,085)
$ 38,692,668 $ - $ (464,914) $ 38,227,754 $ 484,915
The bonds are payable solely from the revenues generated by the Project and secured by the
revenues pledged and assigned under the terms of the Trust Indenture. Interest rates on the bonds
range from 4.00% to 11,00% and are payable semi-annually. The debt service requirements of the
bonds are as follows:
Due Fiscal Year
Ending August 31
Principal
Interest
Total
2006
$ 545,000
$ 2,232,586
$ 2,777,586
2007
570,000
2,207,923
2,777,923
2008
595,000
2,180,920
2,775,920
2009
620,000
2,151,940
2,771,940
2010
650,000
2,121,044
2,771,044
2011-2015
3,785,000
10,028,319
13,813,319
2016-2020
4,935,000
8,814,963
13,749,963
2021-2025
6,440,000
7,225,825
13,665,825
2026-2030
8,445,000
5,110,942
13,555,942
2031-2033
11,765,000
1,644,413
13,409,413
Total Debt Service $ 38,350,000 $ 43,718,875 $ 82,068,875
At August 31, 2005, the Project had not made interest payments on the subordinate 2001C Bond
Series since July 2003 and the subordinate 20010 Bond is in default. In addition, the Project's fixed
charges coverage ratio was not in compliance with the covenants of the Indenture. These events do
not constitute an event of default that accelerates the bonds. As a result, the maturities are
presented under the original repayment terms.
37
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 8. Discretely Presented Long -Term Debt — continued
The Ridge at North Texas
The long term debt activity of the Ridge at North Texas is as follows:
Balance
911/2004 Increases Decreases
Revenue Bonds
Balance Due within
8131/2005 One Year
2001A Bonds $ 29,055,000 $
- $ (100,000)
$ 28,955,000
$ 28,955,000
2001 B Bonds 3,475,000
- (235,000)
3,240,000
3,240,000
Less Discounts (972,204)
- 37,485
(934,719)
(934,719)
$ 31,557,796 $
- $ (297,515)
$• 31,260,281
$ 31,260,281
The bonds are payable solely from the revenues generated by the Project and secured by the
revenues pledged and assigned under the terms of the Trust Indenture. interest rates on the bonds
range from 5.00% to 11.00% and are payable semi-annually.
At August 31, 2005, the Project was not in compliance with certain covenants. Upon certain events of
default either the Trustee, or owners of not less than 25% in aggregate principal of the bonds then
outstanding, may declare the principal and all interest then due to be immediately due and payable.
In addition, all required principal payments on the Series B bonds had not been made at August 31,
2005.
The Town is not liable for the debt of the discretely presented component units.
Note 9. Deferred Revenue
Deferred revenue in the proprietary fund of $514,166 relates to the collection of the entire amount due
on five Ductbank leases as follows: One 20 year lease with AT&T local network services and four 20
and 25 year leases with Verizon Southwest for use of the Town's ductbank.
Note 10. Commitments and Contingencies
Lease Obligations
The Town has commitments relative to municipal services, and contractual relationships
concerning certain utilities and public safety resources, which are normal in its ongoing activity.
Non -cancelable obligations consist of agreements for services at September 30, 2005
Minimum lease payments and contractual obligations under these non -cancelable leases and
agreements as of September 30, 2005 are as follows:
Fiscal Year End,
September 30. _ Amount
2006 $ 8,810
2007 2,431
Total $ 11.241
Rental expenditures in 2005 were $14,531.
38
TOWN OF W ESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 10. Commitments and Contingencies -continued
Interlocal Agreement with the City of Southlake
In August 1995, the Town entered into an agreement with the City of Southlake to allow the Town
to utilize capacity in a sewer line and to set forth their respective rights and obligations with
respect to the sewer line owned by the City of Southlake. The town is obligated to share in the
cost of construction, operation and maintenance of the water sewer line. The sewer line was
constructed in 2000. Additionally, the Town must pay the City of Southlake all transportation,
treatment and related costs allocable to the metered flow of sewage from the Town into the sewer
line.
Note 11. Federal and State Program Revenues
The Town received financial assistance from various federal and state governmental agencies in the
form of grants. The disbursement of funds received under these programs generally requires
compliance with terms and conditions specified in the grant agreements and are subject to audit by
the grantor agencies. Any unallowed disbursement resulting from such audits becomes a liability of
the Town. In the opinion of the Town management, no material refunds will be required as a result of
unallowed disbursements (if any), by the grantor agencies.
Sources of federal and state program revenues for the year ended September 30, 2005, were as
follows:
Source
Federal program revenues:
Homeland Security
Federal Emergency Management Agency
U.S. Department of Education - passed
through State Department of Education
State program revenues:
State Department of Education
Note 12. Excess of Expenditures over Appropriations
General Fund
General Westlake
Fund Academy Total
$ 25,842 $
1,864
$ 25,842
1,864
257,686 257,686
$ 27,7D6 $ 257,686 $ 285,392
$ - $ 1,597,362 $ 1,597,362
Excess of expenditures over appropriations in general government is a result of the unexpected
liability related to the settlement of a protracted lawsuit involving annexation which began in 2002.
The excess in the public works division is related to the additional right-of-way watering due to the
dry summer and unanticipated road repairs.
Utility Fund
The excess of expenditures over appropriations for the water purchases is a result of the drought
conditions the Town encountered. This overexpenditure was funded by greater than anticipated
water revenues.
39
I UVVIN Ut- VVt51 LAKt, I EX.AS
NOTES TO THE FINANCIAL STATEMENTS
Note 13. Retirement Plan
Plan Description
The Town provides pension benefits for all of its full-time employees through a non-traditional,
joint contributory, hybrid defined contribution plan in the statewide Texas Municipal Retirement
System C'TMRS"), one of 794 administered by TMRS, an agent multiple -employer public
employee retirement system.
Benefits depend upon the sum of the employee's contributions to the plan, with interest, and the
Town -financed monetary credits, with interest. At the date the plan began, the Town granted
monetary credits for service rendered before the plan began of a theoretical amount equal to two
times what would have been contributed by the employee, with Interest, prior to establishment of
the plan. Monetary credits for service since the plan began are 100°/x, 1.50% or 200% of the
employee's accumulated contributions.
In addition, the Town can grant, as often as annually, another type of monetary credit referred to
as updated service credit which is a theoretical amount which, when added to the employee's
accumulated contributions and the monetary credits for service since the plan began, would be
the total monetary credits and employee contributions accumulated with interest if the current
employee contribution rate and Town matching percent had always been in existence and if the
employee's salary had always been the average of his/her 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 Town, within the options available
in the state statues governing TMRS and within the actuarial constraints also in the statues.
Deposits are at a rate of 7%, and the Town matching ratio is currently 2 to 1. An employee is
vested after 5 years of service. Employees can retire at age 60 with 5 years of service or at any
age after 20 years of service with the Town.
Contributions
Under the state law governing TMRS, the actuary annually determines the Town 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 Town matching
percent, which are the obligation of the Town as of an employee's retirement date, not at the time
the employee's contributions are made. The normal cost contribution rate is the actuarially
determined percent of payroll necessary to satisfy the obligation of the Town to each employee at
the time his/her retirement becomes effective. The prior service contribution rate amortizes the
unfunded (overfunded) actuarial liability (asset) over the remainder of the plan's 25 -year
amortization period. The unit credit actuarial cost method is used for determining the Town
contribution rate. Both the employees and the Town matte contributions monthly. Since the
Town 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.
40
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 13. Retirement Plan - continued
Schedule of Actuarial Liabilities and Funding Progress
Actuarial valuation date
Actuarial accrued liability
Percentage funded
Unfunded actuarial accrued liability ("UAAL")
Annual covered payroll
UAAL as a percentage of covered payroll
Net pension obligation ("NPO") at the beginning of the year
Annual required contribution
Contributions made
NPO at the end of the year
Actuarial Assumptions
Actuarial cost method
Amortization method
Remaining amortization period
Asset valuation method
Investment rate of return
Projected salaryincreases
Includes inflation at
Cost of Illving adjustments
Note 14. Interfund Balances and Transactions
1213112004 12131/2003
412,742 212,522
423,569 230,684
97.4% 92.1%
10,827 18,162
1,299,091 844,639
0.8% 2.2%
105,663 77,491
(105,663) (77,491)
Unit credit
Level percent of payroll
25 years- open period
Amortized cost
7%
None
3.5%
None
(1) Interfund receivables and payables at September 30, 2005 were as follows:
Fund
General Fund
Westlake Academy General Fund
Visitor's Association Fund
Enterprise Fund
Capital Projects Fund
Special Revenue Fund
Visitor's Association
General Fund
Westlake Academy General Fund
General Fund
Capital Project Fund
General Fund
Enterprise Fund
General Fund
Due from Other Due to Other
Funds Funds
2,354 -
2,862 -
126,580
- 18,643
2,862
- 9,293
18,643 -
- 126,580
$ 150,439 $ 157,378
These balances represent timing differences related to routine advances from the Town for water
and sewer and academy operations and other capital transactions. Interfund receivables and
payables between the Westlake Academy General Fund and the Town differ by $6,939 as a
result of different fiscal year ends. Amounts totaling $125,010 represent advances for capital
expenditures and are to be repaid over a 15 year term.
41
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
(Vote 14. Interfund Balances and Transactions - continued
(2) Receivable and payable balances between the Town and its component units consisted of the
following at September 30, 2005:
Primary Government:
General Fund
Westlake 4A Corporation
Captial Projects Fund
Westlake 4A Corporation
Enterprise Fund
Westlake 4B Corporation
Component Units:
Westlake 4B Corporation
Westlake 4A Corporation
Enterprise Fund
Westlake 4A Corporation
Westlake 413 Corporation
Captial Projects Fund
General Fund
Due from Due to
Primary _ Component
$ 60,000 $ .
416,231
- 13,398
416,231
93,398
60,000 -
- 60,000
$ 549,629 $ 549,629
These balances represent advances from the component units for operations and capital
expenditures. Amounts totaling $416,231 represent advances for capital transactions to be
repaid over a 15 year term.
(3) Transactions between the primary government's funds and its component units for the year
ended September 30, 2005 consisted of the following.
Contribution from (Fund) Contribution to (Fund)
Primary Government
Component Units Capital Projects Debt Service General Total
Westlake 4A Corporation $ 119,263 $ - $ 35,758 $ 155,021
Westlake 413 Corporation - 1,0213,104 1,028,104
Total $ 118,263 $ 1,028,104 $ 35,758 $ 1,183,125
Component Units
Westlake 4A Westlake 4B
Corporation Corporation Total
Primary Government
General Fund $ - $ 16 $ 16
Capital Projects Fund - 213,297 213,297
Total $ - $ 213,313 $ 213,313
42
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 14. Interfund Balances and Transactions - continued
(4) Interfund transfers between the primary government's funds consisted of:
Transfers In Transfers Out
GENERAL FUND
Transfer in from CC $ - $ (16)
Transfer in from Utility Fund - (71,857)
Transfer out to Capital Projects Fund 100,137 -
CIVIC CAMPUS FUND
Transfer out to General Fund 16 -
CAPITAL PROJECTS FUND
Transfer in from General Fund - (100,137)
UTILITY FUND
Transfer out to General Fund 71,857 -
$ 172,010 $ (172,010)
Contributions from the Westlake 4B Corporation to the Debt Service fund in the amount of $1,028,104
represent interest expense associated with debt for the construction of the civic center as authorized
in Section 4B of the Texas Revised Civil Statutes, Ann. Sec. 5190.6.
Contributions from the Westlake 4A Corporation to the General Fund in the amount of $119,263
represents engineering costs related to FM 1938 and SH 114. The $35,758 contribution represents
payment of the sales tax rebate to Fidelity
Contributions from the General Fund to Westlake 4B Corporation in the amount of $16 represent a
transfer of interest.
Contributions from the Capital Project fund to the Westlake 4B Corporation in the amount of $213,297
represents excess funds transferred to the Capital Project Fund.
The Town received $6,000 for the year ended August 31, 2005 for rent from the Texas Student
Housing Authority.
Note 15. Water Purchase and Wastewater Treatment Contracts
The Town has a contract with the City of Fort Worth, Texas to purchase water. Under the contract,
the Town may obtain from the City of Fort Worth a supply of potable water at a reasonable rate based
on water usage. The rate charges are subject to minimum annual contract payments. Water
expense for the year ended September 30, 2005, was $593,011.
43
TOWN OF WESTLAKE, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
Note 16. Risk Management
The Town is exposed to various risk of loss related to torts, theft of, damage to, and destruction of
assets; errors and omissions; injuries to employees, and natural disasters. The Town's general
liability, worker's compensation liability, law enforcement liability, errors and omissions liability, and
automobile (lability coverage is insured by the Texas Municipal League, a public entity risk pool. The
Town's only responsibility to the Texas Municipal League is to pay premiums for insurance and
related deductible amounts of these policies. Other risk of loss is covered by commercial insurance.
Settlements of claims have not exceeded coverage in the past three years.
Note 17. Contingent Liabilities
Various claims and lawsuits are pending against the Town. In the opinion of Town management,
after consultation with legal counsel, the potential loss on all claims and lawsuits will not materially
effect the Town's financial position.
Note 18. Prior Period Adjustment
Engineering expenses were recorded on the books of the town for $38,115 for the year ended
September 30, 2004. These expenses should have been recorded as construction in progress in prior
year. A prior period adjustment for $38,115 has been recorded in the current year to correct this
error.
44
TOWN OF WESTLAKE, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL - GENERAL FUND
FOR THE YEAR ENDED SEPTEMBER 30, 2005
OTHER FINANCING SOURCES (USES)
Proceeds from sale of land - 412,239 412,239 -
Operating transfers in - 85,000 71,873 (13,127)
Operating transfers out (140,000) (129,508) (100,137) 29,371
Net other financing sources (uses) (140,000) 367,731 383,975 16,244
Excess (deficiency) of revenues and other sources over
expenditures and other uses 1,697,877 299,006 (62,647) (361,653)
Fund balance at beginning of year 1,000,073 1,000,073 1,000,073 -
Fund balance at end of year $ 2,697,950 $ 1,299,079 $ 937,426 $ (361,653)
45
General Fund
Variance
Budgeted Amounts
Favorable
Ori
Amended
Actual
(Unfavorable)
REVENUES:
Taxes
Sales
$ 1,300,000
$ 1,016,000
$ 994,606 $
(21,394)
Mixed beverages
10,000
13,182
13,846
664
Franchise
353,475
347,795
352,115
4,320
Federal program revenues
-
25,512
27,706
2,194
Interest income
12,867
18,540
21,469
2,929
Building permits and fees
2,877,124
875,016
740,027
(134,989)
Fines and penalties
784,950
1,073,656
1,007,142
(66,514)
Contributions from others
-
-
35,758
35,758
Other miscellaneous income
105,802
90,511
40,839
(49,672
Total revenues
5,444,218
3,460,212
3,233,508
(226,704)
EXPENDITURES:
Current
General government and administration
1,709,923
1,544,102
1,716,269
(172,167)
Public safety
1,603,442
1,566,791
1,554,115
12,676
Cultural and recreational
97,190
105,923
96,617
9,306
Public works
127,786
91,578
112,764
(21,186)
Economic development
50,000
50,000
35,758
14,242
Capital Outlay
18,000
170,543
164,607
5,936
Total expenditures
3,606,341
3,528,937
3,680,130
(151,193)
Excess (deficiency) of revenues over expenditures
1,837,877
(68,725)
(446,622)
(377,897)
OTHER FINANCING SOURCES (USES)
Proceeds from sale of land - 412,239 412,239 -
Operating transfers in - 85,000 71,873 (13,127)
Operating transfers out (140,000) (129,508) (100,137) 29,371
Net other financing sources (uses) (140,000) 367,731 383,975 16,244
Excess (deficiency) of revenues and other sources over
expenditures and other uses 1,697,877 299,006 (62,647) (361,653)
Fund balance at beginning of year 1,000,073 1,000,073 1,000,073 -
Fund balance at end of year $ 2,697,950 $ 1,299,079 $ 937,426 $ (361,653)
45
TOWN OF WESTLAKE, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL -- WESTLAKE ACADEMY GENERAL FUND
FOR THE YEAR ENDED SEPTEMBER 30, 2005
REVENUES:
State program revenues
Other miscellaneous income
Total revenues
EXPENDITURES:
Education
Total expenditures
Excess (deficiency) of revenues over expenditures
Fund balance at beginning of year
Fund balance at end of year
l5
Variance
Budgeted Amounts
Favorable
Orginal
Final
Actual
(Unfavorable)
$ 282,300 $
240,758 $
242,050
$ 1,292
1,353,576
1,570,232
1,589,848
19,616
1,635,876
1,810,990
1,831,898
20,908
1,634,180
1,640,802
1,612,198
28,604
1,634,180
1,640,802
1,612,198
28,604
1,696
170,188
219,700
49,512
12,391
12,391
12,391
-
$ 14,087 $
182,579 $
232,091
$ 49,512
l5
TOWN OF WESTLAKE, TEXAS
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
Budgetary Control
The Board of Aldermen adopts an annual budget prior to October T for the general and
proprietary funds. The annual budget for the general and proprietary funds is prepared in
accordance with the basis of accounting utilized by that fund and is legally enacted through
passage of an ordinance. The Board of Alderman throughout the fiscal year can amend the
budget.
The Combined Schedule of Revenues, Expenditures, and Changes in Fund Balances — Budget
and Actual — General Fund and Westlake Academy General Fund presents a comparison of
budgetary data to actual results of operations for which the annual operating budget is legally
adopted. The general fund utilizes the same basis of accounting for both budgetary purposes
and actual results. Formal budgetary accounting is to be employed as a management control for
all funds of the Town. The Town Manager is authorized to transfer budgeted amounts between
line items and departments within any fund; however, the Board of Aldermen must approve any
revisions that alter the total expenses/expenditures of any fund.
47