HomeMy WebLinkAboutCity of Euless Comprehensive Annual Financial Report FY2019
City of Euless, Texas
Comprehensive Annual Financial Report
Fiscal Year Ending
September 30, 2019
Prepared by
City of Euless
Finance Department
201 North Ector Drive
Euless, TX 76039
CITY OF EULESS, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED SEPTEMBER 30, 2019
C O N T E N T S
Page(s)
INTRODUCTORY SECTION
Letter of Transmittal i-vii
City Officials viii
Organizational Chart ix
GFOA Certificate of Achievement x
FINANCIAL SECTION
Independent Auditor's Report 1-3
Management’s Discussion and Analysis (unaudited)5-17
Basic Financial Statements
Government-Wide Financial Statements
Statement of Net Position 18
Statement of Activities 19
Fund Financial Statements
Governmental Funds
Balance Sheet 20
Reconciliation of the Governmental Funds Balance Sheet to the
Statement of Net Position 21
Statement of Revenues, Expenditures and Changes in Fund Balances 22
Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances of Governmental Funds to the Statement
of Activities 23
Proprietary Funds
Statement of Net Position 24-27
Statement of Revenues, Expenses, and Changes in Net Position 28-31
Statement of Cash Flows 32-35
Fiduciary Funds
Statement of Net Position 36
Statement of Changes in Fiduciary Net Position 37
Notes to Basic Financial Statements 38-78
Required Supplementary Information
Schedule of Changes in Net Pension Liability
and Related Ratios (Texas Municipal Retirement System)80
Schedule of Contributions (Texas Municipal Retirement System)81
Schedule of Changes in Net OPEB Liability and Related Ratios 82
Schedule of Contributions – OPEB Trust 83
Budgetary Comparison Schedules
General Fund 84-85
Car Rental Special Revenue Fund 86
Notes to Required Supplementary Information 87
Combining and Individual Fund Statements and Schedules
Non-Major Governmental Funds
Combining Balance Sheet 92-95
CITY OF EULESS, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED SEPTEMBER 30, 2019
C O N T E N T S – CONTINUED
Page(s)
Combining and Individual Fund Statements and Schedules - Continued
Non-Major Governmental Funds
Combining Statement of Revenues, Expenditures, and Changes
in Fund Balances 96-99
Schedule of Revenues, Expenditures, and Changes in Fund Balances
Budget and Actual
Hotel/Motel Special Revenue Fund 100
Half-Penny Sales Tax Special Revenue Fund 101
Police Drug Enforcement Special Revenue Fund 102
Crime Control and Prevention District Special Revenue Fund 103
Grant Special Revenue Fund 104
Police Seized Assets Special Revenue Fund 105
Juvenile Case Special Revenue Fund 106
TIRZ #3 Glade Parks Special Revenue Fund 107
Midtown Public Improvement District Special Revenue Fund 108
TIRZ #4 Midtown Special Revenue Fund 109
Cable PEG Fees Special Revenue Fund 110
Internal Service Funds
Combining Statement of Net Position 112
Combining Statement of Revenues, Expenses, and Changes in Net Position 113
Combining Statement of Cash Flows 114
Escrow Agency Funds
Combining Statement of Changes in Assets and Liabilities 115
STATISTICAL SECTION (Unaudited)Table
Net Position by Component 1 119
Changes in Net Position 2 120-121
Fund Balances, Governmental Funds 3 122
Changes in Fund Balances, Governmental Funds 4 123
Estimated Actual Value of Taxable Property 5 124
Direct and Overlapping Property Tax Rates 6 125
Principal Property Taxpayers 7 126
Property Tax Levies and Collections 8 127
Ratio of Outstanding Debt by Type 9 128
Ratio of Net General Bonded Debt to Assessed Value and
Net Bonded Debt Per Capita 10 129
Direct and Overlapping Governmental Activities Debt 11 130
Schedule of Revenue Bond Coverage Water and Wastewater Bonds 12 131
Schedule of Revenue Bond Coverage Drainage Utility Bonds 13 132
Demographic Statistics 14 133
Principal Employers 15 134
Full-time Equivalent City Government Employees by Function/Program 16 135
Operating Indicators by Function/Program 17 136
Capital Asset Statistics by Function/Program 18 137
INTRODUCTORY SECTION
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February 25, 2020
To the Honorable Mayor,
Members of the City Council, and
Citizens of the City of Euless, Texas
The Finance Department and City Manager’s Office are pleased to submit the
Comprehensive Annual Financial Report (“CAFR”) for the City of Euless, Texas (“City”)
for the fiscal year ended September 30, 2019. This report complies with State law which
requires that all local governments publish, within six months of the close of each fiscal
year, a complete set of financial statements presented in conformity with accounting
principles generally accepted in the United States of America (“GAAP”) and audited in
accordance with auditing standards generally accepted in the United States of America by
a firm of licensed certified public accountants.
This report is published to provide the City Council, City staff, citizens, bondholders, and
other interested parties with detailed information concerning the financial condition and
activities of the City. The report consists of City management’s representations concerning
the finances of the City. Consequently, management assumes full responsibility for the
accuracy, completeness, and reliability of all of the information presented in the report. To
provide a reasonable basis for making these representations, management of the City has
established a comprehensive internal control framework that is designed both to protect the
City’s assets from loss, theft, or misuse and to compile sufficient reliable informati on for
the preparation of the City’s financial statements in conformity with GAAP. Because the
cost of internal controls should not outweigh the benefits derived from them, the City’s
comprehensive framework of internal controls has been designed to provide reasonable
rather than absolute assurance that the financial statements will be free from material
misstatement. As management, we assert that, to the best of our knowledge and belief, this
financial report is complete and reliable in all material respects.
The City’s financial statements have been audited by Weaver, L.L.P., a firm of licensed,
certified public accountants. The goal of the independent audit is to provide reasonable
assurance that the financial statements of the City for the fiscal year ended September 30,
2019, are free of material misstatement. The independent audit involved examining, on a
test basis, evidence supporting the amounts and disclosures in the financial statements;
assessing the accounting principles used and significant estimates made by management;
and evaluating the overall financial statement presentation. The independent auditor
concluded, based upon the audit, that there was a reasonable basis for rendering an
unmodified (“clean”) opinion that the City’s financial statements for the fiscal year ended
September 30, 2019, are fairly presented in conformity with GAAP. The independent
auditor’s report is presented as the first component of the Financial Section of this report.
201 N. Ector Drive, Euless TX 76039-3595
817/685-1400 Metro 817/267-4403 Fax 817/685-1416
www.eulesstx.gov
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This report is presented in three sections: Introductory, Financial, and Statistical. The
Introductory Section includes this transmittal letter, a listing of City Officials, and an
organizational chart of the City. The Financial Section includes the independent auditor’s
report on the basic financial statements, Management’s Discussion and Analysis
(“MD&A”), basic financial statements, the notes to the basic financial statements, and
combining and individual fund statements and schedules. The MD&A is a narrative
introduction, overview, and analysis to accompany the basic financial statements. This
letter of transmittal is designed to complement, and should be read in conjunction with, the
MD&A. The City of Euless’ MD&A can be found immediately following the independent
auditor’s report. The Statistical Section includes financial and demographic information
relevant to readers of the City’s financial statements. The statistical data is generally
presented on a multi-year basis.
Profile of the City of Euless, Texas
The City of Euless is located in North Central Texas in Northeast Tarrant County
approximately 16 miles west of Dallas and 16 miles east of Fort Worth. Euless is readily
accessible by State Highway 183 which is a multi-lane expressway linking Dallas to Fort
Worth. Other major highways through the City include State Highway 121, State Highway
360, State Highway 10 and Farm-to-Market Road 157. Euless’ centralized location
provides quick access to both Dallas and Fort Worth metropolitan areas and is adjacent to
Dallas-Fort Worth International Airport (“DFW Airport”), one of the world’s busiest
airports. The City is approximately 16.2 square miles and serves a population of
approximately 56,160.
The City of Euless was incorporated February 24, 1953 and is a home rule city operating
under a Council/Manager form of government. The City Council is comprised of the mayor
and six council members who are elected at large. The Council has the authority to enact
local legislation, levy taxes, adopt budgets, determine policies, incur debt, and appoint the
City Secretary, City Attorney, Municipal Court Judge, and the City Manage r. The City
Manager reports directly to the City Council, and is responsible for the daily management
of the various City departments. Council members serve three-year staggered terms, with
two council members elected each year. The Mayor is elected to serve a three-year term.
In addition, several boards and commissions were created to assist the City Council in
deciding matters of policy and procedure and meet on various issues throughout the year.
The City of Euless provides a full range of services to its citizens including: police and
fire protection; emergency ambulance services; municipal court operations; development
and code services; construction and maintenance of streets and highways, parks, and
recreational facilities; water service and wastewater collection and treatment; and library
operations. The City also operates a top-ranked, 18-hole golf course and conference center,
an adult softball facility, youth athletic complex, and an aquatics center. Internal services
of the City account for risk management, equipment replacement, and employee insurance
coverage activities on a cost reimbursement basis. Private contractors, through franchise
agreements, provide solid waste and recycling collections and disposal services for the
City.
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Four component units of the City, the Euless Development Corporation, the Euless Crime
Control and Prevention District, Tax Increment Reinvestment Zone (TIRZ) #3 – Glade
Parks, and Tax Increment Reinvestment Zone (TIRZ) #4 – Midtown, are presented in the
financial statements of the City as blended component units. Data for these organizations
is recorded in and presented as special revenue funds in the City’s financial statements.
Additional information on these component units can also be found in Note 1 in the Notes
to the Basic Financial Statements.
The annual budget serves as the foundation for the City of Euless’ financial planning and
control. Per the City Charter, the City Manager provides to the City Council the proposed
budget by August 1st each year. The budget is filed with the City Secretary and is open for
public inspection. Upon receipt of the budget, the City Council sets a date for a public
hearing at which time interested citizens may express their opinions regarding the proposed
budget. The Charter requires the Council to adopt the budget by a favorable majority vote
at least ten days prior to the beginning of the next fiscal year.
The City Manager is authorized to transfer budgeted amounts between line items and
departments within any fund; however any revisions that alter the total expenditures of any
fund must be approved by the City Council. Budgetary control has been established at the
individual fund level. Financial reports are produced showing budget to actual
expenditures by line item and are distributed monthly to City departments for review.
Economic Condition
The information presented in the financial statements is perhaps best understood when it is
considered from the broader perspective of the specific environment within which the City
of Euless operates.
The City of Euless is located in Tarrant County in the heart of the Dallas/Fort Worth (DFW)
Metroplex and adjacent to the DFW International Airport. Thus, the economic vitality of
the region significantly impacts the economic health of Euless.
DFW Airport reports itself as the fourth largest airport in terms of operations and fifteenth
largest in terms of passengers in the world, handling over 73 million passengers a year.
DFW Airport reports service is provided to 260 destinations. It is reported by the airport
that economic activity across the North Texas area attributable to DFW Airport totals $37
billion in economic output, 228,000 in full-time jobs, and $12.5 billion in payroll.
According to the North Texas Commission, DFW is the 4 largest region in the US and has
experienced tremendous growth during the past decade. With its highly-diversified
economy, DFW has a population of over 7.4 million, a Gross Metro Product of $511.6
billion, a labor force of over 3.9 million, a 2.8% job growth rate, 22 Fortune 500 Firms,
and college enrollment of over 367,000. Such an economic environment has helped the
region weather economic downturns in key sectors better than many other regions in the
nation.
The Alliance Texas development in North Fort Worth is a 26,000-acre master-planned,
mixed-use community which is home to more than 480 companies, 48,000+ employees,
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and is anchored by the inland port known as the Alliance Global Logistics Hub. This area
offers a variety of commercial real estate options, industrial space, office space, and retail
facilities and had a $4.73 billion annual impact in North Texas in 2017
(www.alliancetexas.com, Alliance Texas Facts).
During the past few years, Euless has realized new commercial, industrial, residential, and
multi-family developments. The City of Euless is focused on bringing quality development
to the area, seeking redevelopment opportunities, and promoting business retention.
Taxable value for all residential and commercial property in the City of Euless is estimated
at approximately $4.9 billion for tax year 2019, which is an 11.78% increase from the prior
year, due to increases in both residential and commercial real estate property values. Sales
tax collections increased during FY2019. Euless continues to look for additional revenue
opportunities in order to minimize the tax burden to citizens and strives to cut costs without
impacting service.
The City also receives a significant amount of revenue from a consolidated rental car
facility located at DFW Airport. The City Council has chosen to use this funding source
to build reserves and to cash flow capital projects in lieu of debt issuance. This has allowed
the City to refrain from becoming overly dependent on a volatile resource while providing
for needed improvements for citizens.
Approximately 496.9 acres of undeveloped land exists inside the City of Euless outside of
DFW Airport.
The Dallas Cowboys AT&T Stadium, Texas Rangers Globe Life Park and Globe Life
Field, and the Six Flags parks all in Arlington, are within minutes of Euless and continue
to attract additional tourism to the City by hosting major concerts and sporting events.
Population with a median age of 36.1 years (U.S. Census Bureau American Fact Finder
2017) has increased from 51,277 to 56,160 since the 2010 census. The City’s median
household income is $60,558, which compares favorably to $57,051 for the State of Texas
(U.S. Census Bureau American Fact Finder 2017). The educational level is 89.2% high
school graduate or higher (U.S. Census Bureau American Fact Finder 2017).
Long-Term Financial Planning
The City of Euless has developed a comprehensive capital improvements document as well
as a multi-year financial plan. Such strategic planning has allowed the City Council to
fund several major infrastructure upgrades, park enhancements, and capital purchases in a
systematic manner while considering the full impact to the operating budget and tax
requirements. Many of these projects have been completed on a pay-as-you-go basis by
utilizing operating revenues, excess reserves, and rental car taxes.
The City Council and citizens of Euless have determined that debt issuance is a viable
method of financing major capital projects. Analysis of potential debt issuance includes
the operating impact the repayment thereof will have on citizens, property tax rates, and
enterprise fund service fee revenues. Per the City’s fiscal policies, long-term debt will not
be used for operating purposes and the life of the debt instruments will not exceed the
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useful life of the projects financed. Policy also specifies that bonds with an average life of
20 years or less will be issued to reduce net interest cost and maintain future flexibility by
paying off debt earlier. The majority of the City’s existing long-term debt was used to
finance infrastructure needs and traditional government facilities such as streets, utility
infrastructure, and development of parks and open spaces.
The City’s fiscal policies state current expenditures will be paid with current revenues.
Deferrals, short-term loans, or one-time sources will be avoided as budget balancing
techniques. Reserves will be used for emergencies or nonrecurring expenditures, except
when balances can be reduced because levels exceed guidelines or legally-required
minimums.
Fiscal policies provide for a General Fund reserve equal to between 30 and 60 days of
working capital. At no time shall the reserve fall below 8.3% of the General Fund
expenditure budget (i.e. 30-day level). The current operating reserve is at 130 days of
operations which equates to approximately 35% of next year’s budgeted expenditures. At
the end of the current year, the City was in compliance with this policy.
The City’s fiscal policies for the Water and Wastewater Fund require the maintenance of a
minimum reserve of 45 to 75 days of working capital. The City currently maintains a 127-
day reserve. Water and Wastewater revenue bond covenants require the City to maintain
reserve amounts sufficient to cover the average annual debt service requirements. This
revenue bond reserve is in addition to the working capital required by the City’s fiscal
policies and is maintained in a separate fund on the general ledger. As of September 30,
2019, the revenue bond reserve totaled $827,464 which meets the required average annual
debt service per bond covenants.
Standard & Poor’s Ratings Services, a subsidiary of the McGraw-Hill Companies, Inc.
rates the City’s general obligation debt and sales tax revenue debt at AA and the water and
wastewater revenue debt at AA+. Moody’s Investor Service, Inc. rates the general
obligation debt and water and wastewater revenue debt at Aa2. Additional information
about the rating agencies or the significance of the ratings provided may be obtained from
each agency’s web site.
Major Initiatives
The City has partnered with Tarrant County, surrounding cities, local churches, and
businesses to renovate qualifying homes in the community through the Tarrant County
Home Program and the Community Powered Revitalization Program (“CPR”). Through
these partnerships, the cities of Hurst, Euless, and Bedford have joined forces to assist
qualifying residents in all three communities.
The City’s Capital Improvements Program and ADA Transition Plan address facility needs
of the City. The Parks Master Plan, which focuses on improving the quality of life for the
community, includes additional hike/bike trails, park amenities and upgrades. The City
has completed several projects in the past year and has many others underway that were
included in these plans. The City believes it is critical that the street, water, wastewater,
and drainage systems are properly maintained and systematically upgraded. While these
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are not glamorous, these represent the most basic governmental functions. Deferral of
these projects creates a financial burden for future generations.
Projects currently underway include Reclaimed Water Line Phase III construction; water
well replacements for the Fuller and Far North wells; FY2018 street reconstruction that
includes sections of Bear Creek, Ash Lane, Fuller-Wiser Road, and Midway Drive; and the
library remodel which is scheduled for completion in spring 2020.
The construction phase of the FY2019 street reconstruction project that includes portions
of West Pipeline Road, South Pipeline Road, Harwood Road, and Mills Drive will begin
in FY2020. Other projects for FY2020 include the reconstruction of Glade Road east of
Highway 360, installation of a traffic signal at Cheek Sparger and Heritage Avenue,
replacement of the water line at Alexander Lane, and replacement of the wastewater lines
at Midway Park 2nd and 3rd Additions and North Main. Fire station #1 demolition and
reconstruction, along with Texas Star Sports Complex Phase VII and Wilshire Park
upgrades will also start in FY2020.
Over the last several years, the City has worked with developers on some major, mixed-
use centers. Glade Parks, located along the southwest corner of Glade Road and Highway
121, provides approximately 1.2 million square feet of retail/office and includes a unique
residential component. In an effort to promote development in this area, the City created a
Tax Increment Reinvestment Zone (“TIRZ”) for the Glade Parks development and
approved the related project and financing plan. This plan authorized the City to undertake
certain public improvements associated with the Glade Parks development. Additionally,
the City created the Glade Parks Public Improvement District (“PID”) which is funded
from assessments within the district. Over the last several fiscal years, numerous
businesses opened in this development creating increased property values and retail sales.
The single family residential component continues to add value to the property tax base as
well.
The RiverWalk! development includes approximately 200 acres located at the northwest
corner of Airport Freeway and State Highway 360 extending north to Harwood Road.
Lennar Homes has developed five (5) subdivisions within the RiverWalk! mixed use
project. At the end of FY2019 there were 592 platted lots. Urban lofts built in the
RiverWalk! total 500-units.
The City also approved a 56-acre mixed-use development called Founders Parc, previously
known as Midtown, located on the south side of State Highway 183, east of Farm-to-
Market Road 157 and north of State Highway 10. This development of 259 new single
family homes, 285 urban lofts, and over 57,000 square feet of retail and commercial space
is underway. Both a TIRZ and a PID have been created by the City to support debt for
public improvements needed for the area including roadways, water distribution system,
sanitary sewer and storm sewer collections systems, hardscaping, and amenities.
Awards and Acknowledgements
The Government Finance Officers Association (“GFOA”) awarded a Certificate of
Achievement for Excellence in Financial Reporting to the City of Euless for its
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Comprehensive Annual Financial Report (“CAFR”) for the fiscal year ended September 30,
2018. The Certificate of Achievement is a prestigious national award recognizing
conformance with the highest standards for preparation of state and local government financial
reports. In order to be awarded a Certificate of Achievement, a government unit must publish
an easily readable and efficiently organized CAFR, whose contents conform to program
standards. Such report must satisfy both Generally Accepted Accounting Principles and
applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. The City has be en
awarded a Certificate of Achievement for the last 32 consecutive years. We believe that the
current CAFR meets the Certificate of Achievement program requirements and are submitting
it to GFOA for review.
In addition, the City of Euless received the GFOA’s Distinguished Budget Presentation Award
for its annual budget document. The City of Euless has received the Distinguished Budget
Award for the last 28 years. In order to qualify for the award, the City’s budget document was
judged to be proficient in several categories, including as a policy document, a financial plan, an
operations guide, and a communications device.
The preparation of this report on a timely basis could not have been accomplished without the
efficient and dedicated services of the entire staff of the Finance Department. Appreciation is
expressed to City employees throughout the organization, especially those who were
instrumental in the successful completion of this report.
We would like to thank the Mayor and members of the City Council for their support in
planning and conducting the financial operations of the City in a responsible, professional, and
progressive manner. As always, the City of Euless staff welcomes and appreciates your
comments.
Respectfully Submitted,
Loretta Getchell Janina Jewell
City Manager Director of Finance
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FINANCIAL SECTION
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Austin | Conroe | Dallas | Fort Worth | Houston Los Angeles | Midland | New York City | San Antonio
Weaver and Tidwell, L.L.P.
2300 North Field Street, Suite 1000 | Dallas, Texas 75201
Main: 972.490.1970 | Fax: 972.702.8321
CPAs AND ADVISORS | WEAVER.COM
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Independent Auditor’s Report
To the Honorable Mayor,
City Council and City Manager
City of Euless, Texas
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business -
type activities, each major fund, and the aggregate remaining fund information of the City of Euless,
Texas (the City) as of and for the year ended September 30, 2019, and the related notes to the financial
statements which collectively comprise the City’s basic financial statements as listed in the table of
contents.
Management’s Responsibility for the Financial Statements
The City’s management is responsible for the preparation and fair presentation of these financial
statements in accordance with accounting principles generally accepted in the United States of
America; this includes the design, implementation, and maintenance of internal control relevant to the
preparation and fair presentation of financial statements that are free from material misstatement,
whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We cond ucted
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 from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and di sclosures
in the financial statements. The procedures selected depend on the auditor’s judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the financial statements in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of
significant accounting estimates made by management, as well as evaluating the overall presentation
of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinions.
Opinions
In our opinion, 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 remaining fund information of the City of Euless, Texas, as of Se ptember 30,
2019, and the respective changes in financial position and, where applicable, cash flows thereof for the
year then ended in accordance with accounting principles generally accepted in the United States of
America.
The Honorable Mayor,
City Council and City Manager
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Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management’s discussion and analysis, and the required supplementary information, as listed in the
table of contents, be presented to supplement the basic financial statements. Such information,
although not a part of the basic financial statements, is required by the Governmental Accounting
Standards Board, who considers it to be an essential part of financ ial reporting for placing the basic
financial statements in an appropriate operational, ec onomic, or historical context. We have applied
certain limited procedures to the required supplementary information in accordance with auditing
standards generally accepted in the United States of America, which consisted of inquiries of
management about the methods of preparing the information and comparing the information for
consistency with management’s responses to our inquiries, the basic financial statements, an d other
knowledge we obtained during our audit of t he basic financial statements. We do not express an
opinion or provide any assurance on the information because the limited procedures do not provide us
with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City’s basic financial statements. The introductory section, combining and
individual nonmajor fund financial statements and schedules, and statistical tables are presented for
purposes of additional analysis and are not a required part of the financial statements.
The combining and individual nonmajor fund financial statements and schedules are the responsibility
of management and were derived from and relate directly to the underlying accounting and other
records used to prepare the basic financial statements. Such information has been subjected to the
auditing procedures applied in the audit of the basic financial statements and certain additional
procedures, including comparing and reconciling such information directly to the underlying
accounting and other records used to prepare the basic financial statements or to the basic financial
statements themselves, and other additional procedures in accordance with auditing standards
generally accepted in the United States of America. In our opinion, the combining and individual
nonmajor fund financial statements and schedules are fairly stated, in all material respects, in relation to
the basic financial statements as a whole.
The introductory and statistical sections have not been subjected to the auditing procedures applied in
the audit of the basic financial statements and, accordingly, we d o not express an opinion or provide
any assurance on them.
The Honorable Mayor,
City Council and City Manager
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Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated February 19,
2020, on our consideration of the City’s internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other
matters. The purpose of that report is to describe the scope of our testing of inter nal control over
financial reporting and compliance and the results of that testing, and not to provide an opinion on
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the City’s internal control
over financial reporting and compliance.
WEAVER AND TIDWELL, L.L.P.
Dallas, Texas
February 19, 2020
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CITY OF EULESS, TEXAS
Management’s Discussion and Analysis
For the Year Ended September 30, 2019
(Unaudited)
Management of the City of Euless offers the readers of the City’s financial statements this narrative
overview and analysis of the financial activities and financial position of the City for the fiscal year
ended September 30, 2019. In the broadest context, the financial well-being of a government lies in the
underlying wealth and willingness of its citizens and property owners to pay adequate taxes combined
with the vision of the government’s elected and appointed leadership to spend those taxes strategically
so that the City’s tax base, service levels, City assets, and the City’s desirability will be maintained not
just for the current year but well into the future.
Financial reporting is limited in its ability to provide the “big picture” but rather f ocuses on financial
position and changes in financial position. In other words, are revenues and/or expenditures higher or
lower than the previous year? Has net position (containing both short-term and long-term assets and
liabilities) or fund balances (the current “spendable” assets less current liabilities”) of the government
been maintained? Readers are encouraged to consider the information presented here in conjunction
with the additional information furnished in the letter of transmittal (pages i-vii of this report) and the
statistical section (pages 119-137 of this report) as well as information in the annual budget and the
capital improvement plan along with other community information found on the City’s website at
www.eulesstx.gov. It should be noted that the Independent Auditor’s Report describes the auditors’
association with the various sections of this report and that all of the additional information from the
website and other City sources are unaudited.
Financial Highlights
The assets and deferred outflows of resources of the City of Euless exceeded its liabilities and
deferred inflows of resources at the close of the most recent fiscal year by $231,847,232 (net
position). This number must be viewed in the context that the vast majority of the City’s net
position of $165,365,720 (71%) is net investment in capital assets and that most capital assets in
government do not directly generate revenue nor can they be sold to generate liquid capital. The net
position restricted for specific purposes totaled $41,279,564 (18%). The remaining $25,201,948
(11%) is unrestricted net position and may be used to meet the government’s ongoing obligations to
citizens and creditors in accordance with the City’s fund designation and fiscal policies.
Governmental activities realized an increase in total net position of $6,944,040 and business -type
activities realized an increase in total net position of $4,427,467 bringing the total increase in net
position for the City to $11,371,507.
At the close of the current fiscal year, the City of Euless’ governmental funds reported combined
ending fund balances of $62,460,631 which represents an increase of $13,041,982. Within this total,
$3,429,240 is restricted for debt service; $19,289,696 is restricted by bond covenant for capital
projects; $130,268 and $280,877 are restricted for court technology and juvenile case management,
respectively; and another $2,240,942 is restricted for capital projects by developer agreements.
Amounts restricted for cable PEG fees and historical preservation total $786,074 and $1,245,
respectively. Nonspendable fund balance of $74,835 represents fund balance amounts for
6
inventories and prepaid items. Fund balances of $19,597,348 represent assigned fund balance in the
general, special revenue, and capital projects funds. The unassigned fund balance in the General
Fund of $16,630,106 can be used for any lawful purpose. The General Fund unassigned balance
represents 42% of fiscal year 2019 total fund expenditures.
The City’s total capital assets (net of accumulated depreciation) increased by $7,726,971 which is
attributed to completion of capital improvement projects and other asset additions including
construction in progress exceeding current year depreciation expense and asset retirements.
The City’s debt payable increased by $17.1 million or 26% due primarily to the issuance of
certificates of obligation, sales tax revenue bonds, and water and wastewater revenue bonds less
scheduled principal payments and annual amortization of premiums and discounts on debt issuances.
OVERVIEW OF THE FINANCIAL STATEMENTS
The discussion and analysis are intended to serve as an introduction to the City of Euless’ basic financial
statements which are comprised of three components: 1) government-wide financial statements, 2) fund
financial statements, and 3) notes to the financial statements. This report also contains other required
supplementary information in addition to the basic financial statements themselves.
Government-wide Financial Statements. The government-wide financial statements are designed to
provide readers with a broad overview of the City of Euless’ finances, in a manner similar to a private -
sector business.
The statement of net position presents information on all of the City of Euless’ assets and deferred
outflows of resources and liabilities and deferred inflows of resources, with the difference between them
reported as net position. Over time, increases or decreases in net position may serve as a useful
indicator of whether the financial position of the City of Euless is improving or deteriorating.
The statement of activities presents information showing how the City’s net position changed during the
fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the
change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported
in this statement for some items that will only result in cash receipts and cash outlays in future fiscal
periods (e.g., uncollected taxes and earned but unused compensated absences).
The government-wide financial statements distinguish between functions of the City that are principally
supported by 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 City include general and administrati ve, public
safety, highways and streets, development services, and culture and recreation. The business-type
activities of the City include water and wastewater system, drainage system, golf course, and other
recreational activities.
The government-wide financial statements include not only the City of Euless (the primary
government), but also the Euless Development Corporation, the Crime Control and Prevention District,
the Tax Increment Reinvestment Zone #3 – Glade Parks, and Tax Increment Reinvestment Zone #4 –
Midtown which are legally separate entities that are financially accountable to the City. A blended
presentation has been used to report the financial information of these component units.
The government-wide financial statements can be found on pages 18-19 of this report.
7
Fund Financial Statements. A fund is a self-balancing set of accounts that is used to maintain control
over resources that have been segregated for specific activities or objectives. The City of Euless, like
other state and local governments, uses fund accounting to ensure and demonstrate compliance with
finance-related legal requirements. All of the funds of the City can be divided into three categories:
governmental funds, proprietary funds, and fiduciary funds.
Governmental Funds. Governmental funds are used to account for essentially the same functions
reported as governmental activities in the government-wide financial statements with the exclusion of
internal service fund activity. However, unlike the government-wide financial statements, governmental
fund financial statements focus on near-term inflows and outflows 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 financing requirements.
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 City maintains twenty-three individual governmental funds. Information is presented separately in
the governmental funds balance sheet and in the governmental funds statement of revenues,
expenditures, and changes in fund balances for the General, Debt Service, Car Rental Tax, and Street
CIP funds, all of which are considered to be major funds. Data from the other nineteen governmental
funds are combined into a single, aggregate presentation. Individual fund data for each of these non -
major governmental funds is provided in the form of combining statements elsewhere in this report.
The City adopts an annual appropriated budget for its General and Car Rental Tax major governmental
funds. A budgetary comparison schedule has been provided for each fund to demonstrate compliance
with the adopted budgets.
The basic governmental fund financial statements can be found on pages 20-23 of this report.
Proprietary funds. The City maintains two different types of proprietary funds. Enterprise funds are
used to report the same functions presented as business-type activities in the government-wide financial
statements. The City uses enterprise funds to account for its water and wastewater, drainage utility, golf
operations, and other recreation enterprises. Internal service funds are an accounting device used to
accumulate resources and allocate costs internally among the City’s various functions. The City uses
internal service funds to account for its equipment replacement, risk management, and health insurance
services. Because these services predominately benefit governmental rather than business-type
functions, a portion of the activities in these funds is included within governmental activities in the
government-wide financial statements.
Proprietary funds provide the same type of information as the government-wide financial statements,
only in more detail. The proprietary fund financial statements provide separate information for Water
and Wastewater, Drainage Utility, Golf, and Other Recreation enterprises all of which are considered to
be major funds of the City. The internal service funds are combined into a single, aggregate
8
presentation in the proprietary fund financial statements. Individual data for the internal service funds is
provided in the form of combining statements elsewhere in this report.
The basic proprietary fund financial statements can be found on pages 24-35 of this report.
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 City’s own programs. The
accounting used for fiduciary funds is much like that used for proprietary funds.
The basic fiduciary fund financial statements can be found on pages 36 and 37 of this report.
Notes to the financial statements. The notes provide additional information that is essential to a full
understanding of the data provided in the government-wide and fund financial statements. The notes to
the financial statements can be found on pages 38-78 of this report.
Other information. In addition to the basic financial statements and accompanying notes, this report
also presents certain required supplementary information concerning the City’s progress in funding its
obligations to provide pension and post-employment healthcare benefits to its employees. Additionally,
schedules comparing budgetary figures and actual results of the General and Car Rental Tax funds are
also located in this section of the report. Required supplementary information can be found on page 80-
87 of this report.
The combining statements referred to earlier in connection with non-major governmental funds and
internal service funds are presented immediately following the required supplementary information on
pensions, OPEB, and budgetary comparisons. Combining and individual fund statements and schedules
can be found on pages 92-115 of this report.
Government-Wide Financial Statement Analysis
As noted earlier, net position and especially net position by category may serve over time as a useful
indicator of a government’s financial position. In the case of the City of Euless, assets and deferred
outflows of resources exceeded liabilities and deferred inflows of resources by $231,847,232 as of
September 30, 2019.
The largest portion of the City’s net position (71%) reflects its investment in capital assets (i.e., land,
buildings, equipment, improvements, construction in progress, and infrastructure) net of accumulated
depreciation, less any debt used to acquire those assets that is still outstanding. The City uses these
capital assets to provide services to citizens; consequently these assets are not available for future
spending and with the exception of business-type assets, do not generate direct revenue for the City.
They do, however, represent an obligation on the part of the City to maintain these assets into the future.
Although the City’s investment in its capital assets is reported net of related debt, it should be noted that
the resources needed to repay this debt must be provided from other sources, since the capital assets
themselves cannot be used to liquidate these liabilities.
An additional portion of the City’s net position (18%) represents resources that are subject to external
restrictions on how they may be used. The remaining balan ce of unrestricted net position of
$25,201,948 (11%) may be used to meet the City’s ongoing obligations to citizens, creditors, and
employees.
9
Net Position
Governmental Business-type Change from PY
Amounts shown in 000's activities activities Total
2019 2018 2019 2018 2019 2018
Current and other assets 87,082$ 71,687$ 43,883$ 35,247$ 130,965$ 106,934$
Capital assets 157,892 153,752 78,845 75,257 236,737 229,009
Total assets 244,974 225,439 122,728 110,504 367,702 335,943
Total deferred outflows 12,575 4,450 2,819 1,282 15,394 5,732
Long-term liabilities 97,467 73,470 31,641 20,930 129,108 94,400
Other liabilities 15,216 14,064 5,867 6,410 21,083 20,474
Total liabilities 112,683 87,534 37,508 27,340 150,191 114,874
Total deferred inflows 892 5,325 166 1,001 1,058 6,326
Net position:
Net investment in
capital assets 99,744 112,710 65,622 63,283 165,366 175,993
Restricted 26,158 13,621 15,121 7,876 41,279 21,497
Unrestricted 18,072 10,699 7,130 12,286 25,202 22,985
Total net position 143,974$ 137,030$ 87,873$ 83,445$ 231,847$ 220,475$
As of September 30, 2019 the City reports positive balances in all three categories of net position, for
the government as a whole, as well as for its separate governmental and business-type activities. The
same situation was true for fiscal year 2018.
The City’s unrestricted net position increased by $2,216,966 in fiscal year 2019 as compared to the
unrestricted net position for the prior year. Restricted net position realized an increase of $19,782,213
and the amount invested in capital assets, net of related debt decreased by $10,627,672. The increase in
total net position of more than $11 million results primarily from current year operating results flowing
to the unrestricted and restricted categories of net position. The decrease in the net investment in capital
assets portion of net position primarily results from current year depreciation expenses, asset disposals,
and the scheduled payments on debt used to acquire those capital assets outpacing asset additions. The
details of the results of current year operations are found in the table shown on the following page.
10
Changes in Net Position
Governmental Business-type
Amounts shown in 000's Activities Activities Totals
2019 2018 2019 2018 2019 2018
REVENUES
Program revenues:
Fees, fines and charges for 6,917$ 7,286$ 33,492$ 34,784$ 40,409$ 42,070$
Operating grants and 622 741 - - 622 741
Capital grants and contributions 1,304 2,355 3,059 1,729 4,363 4,084
General revenues:
Property taxes 20,429 18,630 - - 20,429 18,630
Sales taxes 21,420 20,728 - - 21,420 20,728
Car rental taxes 14,797 14,776 - - 14,797 14,776
Mixed beverage taxes 138 154 - - 138 154
Occupancy taxes 842 865 - - 842 865
Gross receipts taxes 4,549 4,811 - - 4,549 4,811
Investment income 1,883 964 747 385 2,630 1,349
Rents and royalties 1,348 1,224 - - 1,348 1,224
Gain on asset disposal - - 10 3 10 3
Miscellaneous 931 773 - - 931 773
Total revenues 75,180 73,307 37,308 36,901 112,488 110,208
EXPENSES
Culture and recreation 7,330 7,071 - - 7,330 7,071
Development services 1,057 1,038 - - 1,057 1,038
General government 21,113 21,357 - - 21,113 21,357
Highways and streets 7,193 3,787 - - 7,193 3,787
Public safety 30,353 27,424 - - 30,353 27,424
Interest and fiscal charges 2,011 1,632 - - 2,011 1,632
Water and wastewater - - 23,493 23,226 23,493 23,226
Drainage utility - - 1,563 1,515 1,563 1,515
Golf course - - 4,732 4,764 4,732 4,764
Recreation enterprises - - 2,271 2,416 2,271 2,416
Total expenses 69,057 62,309 32,059 31,921 101,116 94,230
Increase (decrease) in net position
before transfers 6,123 10,998 5,249 4,980 11,372 15,978
Transfers 821 761 (821) (761) - -
Increase (decrease) in net position 6,944 11,759 4,428 4,219 11,372 15,978
Net position, beginning 137,030 125,271 83,445 79,226 220,475 204,497
Net position ending 143,974$ 137,030$ 87,873$ 83,445$ 231,847$ 220,475$
11
Governmental activities. Governmental activities increased the City’s net position by $6,944,040
thereby accounting for most of the growth (61%) in total net position. Most revenue categories,
including property taxes, car rental taxes, and investment income exceeded prior year receipts.
Sound fiscal management and close monitoring of revenues and expenses allowed the City to realize
an increase in governmental activities net position before transfers of $6,123,377.
Total revenue for the governmental activities (excluding transfers) increased from the previous year
by $1,873,261. General revenue, which is primarily comprised of property taxes, sales taxes, and
car rental taxes, realized a net increase of $3.4 million. Property tax revenue increased due to an
overall increase in taxable values of 10.3% over the prior year values. Sales tax collections
increased as a result of improvement of the local economy, new retail business openings, and the
stabilization of several large taxpayers. Car rental taxes were relatively flat with the prior year
collections. Total governmental program revenues, which consist primarily of charges for services,
grants, and contributions, net to a decrease of $1.5 million. Charges for services accounts for
approximately $369,000 of this decrease. The largest decrease was noted in the public safety sector.
Ambulance revenues and jail income from housing detainees decreased approximately $115,000
combined. There was a swing in the government-wide charges for services of nearly $231,000 due
in part to the prior year recognition or elimination of deferred revenues in governmental funds and a
decrease in deferrals in the current year. Additionally, municipal court fines declined by more t han
$245,000 as compared to the prior year. The Midtown PID assessment for the current year accounts
for the increase in highways and streets program revenues of $126,000. Development remained
strong throughout the year and outpaced last year’s figures b y more than $250,000. General and
administrative charges for services decreased by $204,000 due in large part to the decline in other
municipal court collections. The police department received $120,000 less in grant revenues in
FY2019 than in the prior year. Developer contributions of infrastructure declined by $970,000 in the
current year.
Total expenses of governmental activities increased by $6.8 million from FY2018 to FY2019. The
raise package for employees included an increase of 2.5% which accounts for an increase in
expenses across all functions. Pension-related entries increased expenses $2,985,000 as compared to
the prior year primarily due to the recording of changes in and amortization of deferred outflows and
deferred inflows combined with the increase in the net pension liability. OPEB-related expenses
which includes the change in the net OPEB liability, related deferred inflows and deferred outflows,
as well as the amortization of the deferrals decreased expenses by approximately $87,0 00 compared
to a decrease in expenses of $412,000 in the prior year. While the allocation of internal service fund
activity was relatively flat year over year, the allocation to the functions varied. The allocation to
general and administrative expenses dropped by $400,000 while public safety picked up an
additional $330,000 and culture and recreation increased by $87,000. Furthermore, fluctuations in
depreciation expense as a result of the acquisition and disposal of capital assets affect the various
expense categories. General and administrative and streets and highways realized expense increases
of $102,000 and $50,000, respectively, due to depreciation charges. More than half of the increase in
public safety expenses results from the pension and OPEB-related entries. Public works expenses
increased primarily as a result of the City’s participation in the final phase of Glade Parks which was
completed during the current year. The net position of general governmental operations accounts for
62% of total net position.
12
Business-type activities. Business-type activities increased the City’s net position by $4,427,467.
The change in net position before transfers is $5,248,130. Charges for services program revenues
for the business-type activities decreased from the previous year by $1.3 million due primarily to
decreased water and wastewater revenues. Capital grants and contributions increased by $1.3
million due to increased grant receipts and developer contributions combined with a reduction in
impact fee collections.
Some expense categories realized decreases for the year, but overall business-type expenses
increased .4%. Increases attributable to the employee raise package and related benefits were offset
by the savings in potable water purchases resulting from a decline in purchased volume of 181
million gallons. An increase in the suppliers’ volume rates resulted in increases in water purchase
costs (in relation to purchased volume) and wastewater treatment charges. Pension entries increased
business-type expenses by approximately $407,000 for the year compared to a decrease of $100,000
in the prior year. OPEB-related entries decreased expenses by $77,000 last year, but only decreased
expenses by $17,000 this year. Net position for business-type activities represents 38% of total net
position.
Financial Analysis of the City’s Funds
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance -
related legal requirements.
Governmental funds. The focus of the City’s governmental funds is to provide information on near-
term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the
City’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of
a City’s net resources available for spending at the end of the fiscal year.
At the end of the current fiscal year, the City of Euless’ governmental funds reported combined ending
fund balances of $62,460,631, which represents an increase of $13,041,982 in comparison with prior
year. Approximately 27% or $16.6 million constitutes unassigned fund balance in the general fund that
is available for spending at the City’s discretion. Another $74,835 in non-spendable fund balance
represents amounts invested in inventories and prepayments. Another portion is restricted to indicate
that it is not available for new spending because it has already been committed 1) to pay debt service
($3,429,240); 2) to pay for specific capital improvements per developer agreements ($2,240,942); 3)
restricted by bond covenant for specific capital projects ($19,289,696); and 4) for a variety of other
restricted purposes ($1,198,464). Assigned fund balance includes funds that management intends to use
for a specific purpose as well as any residual balances of governmental funds other than the general
fund. Assigned fund balance totals $19,597,348 and includes assigned fund balance in the general fund
of $135,720 and $19,461,628 which represents residual balances in other governmental funds. See
discussion under Fund Balance Classifications in Note 1 of the Notes to Basic Financial Statements for
additional details on fund balance.
In the General Fund, the City budgeted for a decrease in fund balance (planned reduction) of
$1,960,745. Due to a positive budget variance in overall revenues and expenditures, the General Fund
ended the year with an increase to fund balance of $2,418,922. This figure represents a positive budget
variance of $4,379,667 resulting primarily from licenses and permit revenues exceeding budget
parameters and expenditure savings of $3.3 million, before transfers.
13
Several General Fund revenue categories realized increases over the prior year and surpassed budget
estimates as well. Licenses and permits, intergovernmental revenue, and investment income are in this
category. An increase in property values resulted in property tax collections surpassing prior year
revenues. However, current year collections fell slightly short of budget expect ations. Sales taxes also
fell short of budget estimates, but surpassed prior year collections due improvement in the local
economy and the opening of new retail establishments. Municipal court fines, jail income, and
ambulance fees fell short of budgetar y parameters and failed to attain prior year levels. Total revenues
surpassed both budget and prior year levels.
Expenditures increased $360,000, or .9% over the prior year, but ended the fiscal year under budget
parameters by nearly $3.3 million. Salary and benefits savings for all functions of $1.3 million were
realized from full-time positions open throughout the year, employee healthcare elections, and savings
in contract labor and part-time salaries. General and administrative expenditures were under budget by
$2.6 million, a portion of which was salary and benefit-related. The remainder includes utilities, such as
water and electric, which recognized budgetary savings of $290,000 and rebates which attained
budgetary savings of more than $230,000 due to sales tax collections falling short of projections. Aside
from salaries and benefits, public safety expenditure savings were also noted in maintenance of $27,000;
hardware/software lease of $38,000; and special services of $11,000. Jail food expenditures realized a
positive budget variance of $26,000 due to a reduction in federal detainees. Culture and recreat ion
realized budgetary savings of $15,000 in mowing costs. One-time capital expenditures were under
budget as a result of cost savings and timing of purchases (for which the funds will roll into the next
fiscal year).
The Debt Service fund balance increased $501,238 which is $570,985 better than the budgeted decrease
of $69,747. The positive variance results primarily from property tax collections and investment income
surpassing budgetary projections combined with the premium collected on the issuance of debt. Savings
in expenditures resulted from reductions in issuance costs. The Car Rental Tax fund balance was
originally anticipated to decrease $967,742 and was revised to decrease $1,017,742, but rather ended the
year with a decrease of $346,435 resulting primarily in a significant increase in investment income
compared to budget expectations and savings in capital outlay. The savings in cap ital outlay were
related to one-time projects for which funding has been rolled into next fiscal year. The Streets CIP
fund balance increased by $8,471,599 due to the issuance of debt and other sources outpacing project
expenditures.
The non-major governmental funds realized a combined increase in fund balance of $1,996,658; special
revenue funds contributed $1,738,211 to this increase, while the capital projects funds only added
$258,447 to the balance. Of the special revenue funds, the EDC realized the largest increase in fund
balance in the amount of almost $959,464 and TIRZ #3 Glade Parks fund balance increased by
$511,378. The remaining non-major special revenue funds net to an increase in fund balance of just
over $267,000. The net increase from CIP funds results primarily from Car Rental CIP transfers in of
more than $3 million resulting in an increase in fund balance of $1.7 million. The EDC CIP fund
realized a decrease in fund balance of more than $1 million due to project expenditures outpacing other
financing sources including the issuance of sales tax revenue bonds of $1,635,000. The remaining CIP
funds combined decreased fund balance by $424,000 due to project expenditures outpacing revenues
and other sources. The combined net effect of these changes in governmental fund balances results in an
increase of approximately $2 million.
14
Enterprise funds. The City’s enterprise fund statements provide the same type of information found in
the government-wide financial statements for business-type activities, but in more detail. Most of the
City’s enterprise funds are heavily dependent upon local weather conditions. During the year, rainfall
exceeded that of a “normal” year by more than twelve inches and exceeded that of the prior year by
almost six inches. Much of this rainfall occurred during peak tournament season for Texas Star Golf
Course and other recreation enterprises. Although August and September were hot and dry, the effects
of the rainfall received earlier in the operating season could not be overcome resulting in revenue
shortfalls in many of the City’s enterprise funds.
Unrestricted net position of the enterprise funds at the close of the fiscal year was: Water and
Wastewater fund $1,377,647; Drainage Utility fund $1,130,959; Golf Course fund $281,333; and Other
Recreation enterprise fund $1,598,435. The Water and Wastewater fund realized a decrease in operating
income resulting primarily from a decline in water consumption as compared to the prior year. Water
consumption was down approximately 13.5%, or 293 million gallons, year over year resulting in a
decline in water service revenues of more than $413,000. Wastewater treatment volume was down by
7% or approximately 107 million gallons. However, rate increases offset the treatment volume decline
resulting in a net increase in wastewater revenues of $196,000. The decline in servi ce fees and
miscellaneous was offset by an increase in developer contributions. Investment income increased by
$325,000 due to better market conditions throughout most of the fiscal year. The overall net income in
the Water and Wastewater fund was approximately $4.8 million.
The decrease in net position of the Drainage Utility fund results primarily from depreciation on drainage
infrastructure and capital assets. Net position for the Golf Course fund decreased $164,685 due in large
part to lagging revenues resulting from excessive rainfall during tournament season as mentioned
previously. Depreciation of capital assets is offset by transfers in from other funds. Other Recreation
Enterprises fund realized an increase of nearly $45,000 in net position. The combined net effect of these
changes in enterprise fund net position totals an increase of $4,345,688.
Capital Asset and Debt Administration
Capital assets. The City’s investment in capital assets for its governmental and business-type activities
as of September 30, 2019, totaled $236,736,519 (net of accumulated depreciation). The investment in
capital assets includes land, buildings, improvements, machinery and equipment, infrastructure, and
construction in progress. The net increase in the City’s investment in capital assets for the current fiscal
year was $7,726,971 or about 3.4%.
Major capital asset activity that occurred during the current fiscal year included the following:
Capital asset contributions were comprised of $245,000 in Community Development Block Grant
(CDBG) expenditures for Oakwood Terrace Phase III wastewater line replacement and developer
asset dedications totaling more than $3 million in street infrastructure, land, water and wastewater
facilities, and drainage structures.
Capital asset additions for governmental activities include, but are not limited to, equipment for
parks and recreation, public works yard improvements, Brazos ticket writers, Euless Family Life
Center flooring replacement, and a variety of public safety equipment.
Construction-in-progress related to general government activity of $25,474,707 primarily consists of
Midtown infrastructure ($18 million), Library Remodel ($4.1 million), FY2018 Street
Reconstruction ($1.2 million), and Carr Park improvements ($970,614).
15
Kynette Drive water line replacement was completed at a cost of $594,000, miscellaneous
wastewater rehab projects at a cost of $41,000 were finalized, and valve replacements were
completed for a cost of $78,000.
Capital asset additions for the business-type activities include, but are not limited to, purchase of a
backhoe, retaining wall improvements, new fencing at the service center and cart path improvements
and remodel at Texas Star Golf Course.
Construction-in-progress related to business-type operations of $5,207,167 primarily consists of
Phase III of the Reclaimed Water System Extension and the Well Replacement projects.
Capital Assets (Net of Accumulated Depreciation)
Amounts shown in 000s activities activities Total
2019 2018 2019 2018 2019 2018
Land 33,439$ 32,539$ 3,619$ 3,618$ 37,058$ 36,157$
Buildings 34,012 35,616 1,551 1,676 35,563 37,292
Other improvements 8,613 8,811 9,891 10,033 18,504 18,844
M&E 9,532 10,094 1,984 2,131 11,516 12,225
Infrastructure 46,821 48,592 56,593 56,846 103,414 105,438
Construction in
Progress 25,475 18,100 5,207 953 30,682 19,053
Total 157,892$ 153,752$ 78,845$ 75,257$ 236,737$ 229,009$
Governmental Business-type
Additional information on the City’s capital assets can be found in Note 3 on pages 55-56 of this report.
Long-term debt. At the end of the current fiscal year, the City had total debt outstanding of
$79,996,397 net of unamortized losses on prior refundings. Of this amount, $58,619,183 comprises debt
backed by the full faith and credit of the government, where $7,556,439 is the amount of self -supported
debt for Texas Star Golf Course and Stars Center. The remainder of the City’s debt, $21,377,214,
represents bonds secured solely by specific revenue sources (i.e. revenue bonds).
Outstanding Bonded Debt
Amounts shown in 000s activities activities Total
2019 2018 2019 2018 2019 2018
GO Bonds 8,805$ 11,460$ 4,295$ 4,770$ 13,100$ 16,230$
COs 46,200 35,660 - - 46,200 35,660
GO/CO deferred loss (310) (417) (371) (417) (681) (834)
Tax notes - 735 - - - 735
Capital lease - 84 - - - 84
Revenue bonds 1,565 40 19,905 11,545 21,470 11,585
Revenue deferred loss - (9) (93) (111) (93) (120)
Totals 56,260$ 47,553$ 23,736$ 15,787$ 79,996$ 63,340$
Governmental Business-type
16
In fiscal year 2019, the City issued $11,785,000 in new certificates of obligation and $1,635,000 in sales
tax revenue bonds. Additionally, $9.275 million in water and sewer revenue bonds were issued utilizing
the Texas Water Development Board Drinking Water State Revolving Fund. The City’s total debt
increased $17,134,670 (exclusive of deferred losses) or 26% during fiscal year 2019 which is attributed
to the addition of the new debt less scheduled annual principal payments and annual amortization of
premiums and discounts on debt issues.
Standard & Poor’s Ratings Services, a division of the McGraw-Hill Companies, Inc. rates the City’s
general obligation debt and revenue debt at AA and the water and wastewater revenue debt at AA+.
Moody’s Investor Service, Inc. rates the general obligation debt and the water and wastewater revenue
debt at Aa2 and the sales tax revenue debt at Aa2. Additional information on the City’s long-term debt
can be found in Note 4 on pages 57-62.
Economic Factors and Next Year’s Budgets and Rates
In the FY2019-20 budget, General Fund revenues and transfers are budgeted to increase by 3.5% from
the FY2018-19 original budget. Property taxes account for 39% of budgeted revenues and sales taxes
comprise approximately 31% of budgeted revenues. Certified assessed valuations as of July 25, 2019
increased 11.8% from the preceding year.
In the FY2019-20 budget, sales tax receipts are projected to increase about $58,000 which is basically
flat with the prior year budget. The car rental tax receipts are anticip ated to remain flat with end-of-year
projections.
Baseline budgeted expenditures in the General Fund are projected to increase approximately 3% from
the FY2018-19 original budget. This increase is partially attributed to the employee raise package and
related costs and the establishment of the replacement plan for furnishings and equipment. The City
elected to use excess reserves to cash flow capital programs including facility improvements, inspection
services, and various equipment needs. The property tax rate remained at .4625¢ per $100 of assessed
valuation for FY2019-20.
For the Water and Wastewater Fund, the FY2019-20 budget includes the continuation of the tiered rate
structure for residential and irrigation water volume billing. Under the tiered structure, customers pay a
graduated volume rate based on varying levels of monthly water consumption. Residential volume rates
range from $4.07 to $6.70 per thousand gallons. Monthly water base rates are increasing by 2% for
both residential and commercial customers. A wastewater volume charge of $4.29 per thousand gallons
applies to all customer classes and monthly base rates are increasing by 25¢. Residential wastewater
volume charges are capped at a maximum of 12,000 gallons per month. The City maintained the annual
funding for pay-as-you-go capital expenses in the Water and Wastewater Fund of $1,075,000. Funding
for Midway Park 3rd Addition Phase I wastewater line replacement, North Main Street wastewater line
replacement, and Alexander Lane water line replacement is included in next year’s budget. CDBG
funding for Phase I of the Midway Park 2nd Addition wastewater line replacement is also included. One-
time capital in the amount of $30,000 is approved for painting fire hydrants.
The Texas Star Golf Course and Conference Centre is a vibrant part of the Euless community. This
secluded facility, located in the midst of the Dallas/Fort Worth Metroplex, is well -known for world class
golf and a challenging course that has been recognized as a premier municipal facility by leading golf
publications, including Golf Digest and Golfweek. Additionally, Raven’s Grille ranked in the top five
for best service and best place to dine before or after your golf experience by Avid Golfer.
17
The Conference Centre has 7,000 square feet of divisible space and hosts business conferences,
weddings, concerts, and other events. Proposed revenues of $4,694,475 and proposed operating
expenses of $4,688,712 comprise the FY2019-20 operating budget.
Request for Information
The financial report is designed to provide citizens, customers, investors, and creditors with a general
overview of the City’s finances. If you have questions about this report or need additional information,
contact the Finance Department, Attn: Janina Jewell, Director of Finance, at 201 North Ector Drive,
Euless, Texas 76039, call (817) 685-1626, or e-mail jjewell@eulesstx.gov.
CITY OF EULESS, TEXAS
GOVERNMENT-WIDE STATEMENT OF NET POSITION
SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
18
Primary Government
Governmental Business-type
Activities Activities Total
Deposits and investments 61,161,022$ 21,323,681$ 82,484,703$
Receivables, net of allowances 8,360,877 4,418,958 12,779,835
Internal balances (2,741,905) 2,741,905 -
Inventories, at cost 11,797 246,295 258,092
Prepaid items 125,195 32,287 157,482
Restricted assets
Deposits and investments 20,164,514 15,121,222 35,285,736
Capital assets
Land and construction in progress 58,913,284 8,825,712 67,738,996
Other capital assets, net of
accumulated depreciation 98,978,616 70,018,907 168,997,523
Total assets 244,973,400 122,728,967 367,702,367
Deferred outflows related to pension 11,355,811 2,184,419 13,540,230
Deferred outflows related to OPEB 909,802 170,299 1,080,101
Deferred charges on refunding 309,762 463,841 773,603
Total deferred outflows of resources 12,575,375 2,818,559 15,393,934
Accounts payable 12,529,725 3,144,445 15,674,170
Accrued liabilities 2,380,780 368,935 2,749,715
Accrued interest payable 305,698 119,404 425,102
Unearned revenue - 97,514 97,514
Money held in escrow - 2,137,159 2,137,159
Noncurrent liabilities
Due within one year 4,831,494 1,722,922 6,554,416
Due in more than one year 92,635,408 29,917,903 122,553,311
Total liabilities 112,683,105 37,508,282 150,191,387
Deferred inflows related to OPEB 403,699 75,186 478,885
Deferred inflows related to pension 487,937 90,860 578,797
Total deferred inflows of resources 891,636 166,046 1,057,682
Net investment in capital assets 99,744,023 65,621,697 165,365,720
Restricted for
Debt service 3,429,240 1,426,830 4,856,070
Capital projects 19,289,696 10,646,450 29,936,146
Impact fees - 3,047,942 3,047,942
Developer agreements 2,240,942 - 2,240,942
Court technology 130,268 - 130,268
Juvenile cases 280,877 - 280,877
Cable PEG fees 786,074 - 786,074
Historical preservation 1,245 - 1,245
Unrestricted 18,071,669 7,130,279 25,201,948
Total net position 143,974,034$ 87,873,198$ 231,847,232$
ASSETS
LIABILITIES
NET POSITION
DEFERRED OUTFLOWS OF RESOURCES
DEFERRED INFLOWS OF RESOURCES
CITY OF EULESS, TEXAS
GOVERNMENT-WIDE STATEMENT OF ACTIVITIES
YEAR ENDED SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
19
Primary Government
Operating Capital Business -
Charges Grants and Grants and Governmental Type
Program Activities Expenses for Services Contributions Contributions Activities Activities Total
Primary government
Governmental activities
Culture and recreation 7,330,168$ 266,091$ 457$ 7,716$ (7,055,904)$ -$ (7,055,904)$
Development services 1,057,414 2,133,420 - - 1,076,006 - 1,076,006
General and administrative 21,112,696 861,929 15,588 - (20,235,179) - (20,235,179)
Highways and streets 7,193,189 1,114,507 - 1,296,704 (4,781,978) - (4,781,978)
Public safety 30,352,705 2,541,205 606,016 - (27,205,484) - (27,205,484)
Interest and fiscal agent charges 2,010,814 - - - (2,010,814) - (2,010,814)
Total governmental activities 69,056,986 6,917,152 622,061 1,304,420 (60,213,353) - (60,213,353)
Business-type activities
Water and wastewater 23,493,321 26,400,731 - 2,637,827 - 5,545,237 5,545,237
Drainage utility 1,563,021 826,711 - 420,464 - (315,846) (315,846)
Golf course 4,731,810 4,067,026 - -- (664,784) (664,784)
Other recreation enterprises 2,270,768 2,197,926 - -- (72,842) (72,842)
Total business-type activities 32,058,920 33,492,394 - 3,058,291 - 4,491,765 4,491,765
Total primary government 101,115,906$ 40,409,546$ 622,061$ 4,362,711$ (60,213,353) 4,491,765 (55,721,588)
General Revenues
Taxes
Property taxes, levied for general purposes 20,428,821 - 20,428,821
Sales taxes 21,419,831 - 21,419,831
Car rental taxes 14,797,320 - 14,797,320
Mixed beverage taxes 138,219 - 138,219
Hotel/motel occupancy taxes 841,588 - 841,588
Gross receipts taxes 4,549,026 - 4,549,026
Investment income 1,882,696 746,865 2,629,561
Rents and royalties 1,348,465 - 1,348,465
Gain on sale of capital assets - 9,500 9,500
Miscellaneous 930,764 - 930,764
Transfers 820,663 (820,663) -
Total general revenues and transfers 67,157,393 (64,298) 67,093,095
Change in net position 6,944,040 4,427,467 11,371,507
NET POSITION, beginning of year 137,029,994 83,445,731 220,475,725
NET POSITION, end of year 143,974,034$ 87,873,198$ 231,847,232$
Net (Expense) Revenue and
Changes in Net Position
Program
Revenues
CITY OF EULESS, TEXAS
BALANCE SHEET – GOVERNMENTAL FUNDS
SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
20
Debt Car Streets Non-major Total
General Service Rental Tax CIP Governmental Governmental
Fund Fund Fund Fund Funds Funds
Deposits and investments 16,880,304$ 2,414,669$ 10,912,438$ 459,988$ 18,511,964$ 49,179,363$
Receivables
Property taxes 386,235 149,856 - - 38,636 574,727
Accounts receivable 1,050,178 745 - 33,600 349,314 1,433,837
Accrued interest receivable 79,790 - 21,678 26,406 38,391 166,265
Due from other governments 2,299,620 - 2,391,070 - 1,385,000 6,075,690
Prepaids and deposits 63,038 - -- -63,038
Inventories, at cost 11,797 - -- -11,797
Restricted deposits and investments 2,686 - -18,441,832 1,719,996 20,164,514
Total assets 20,773,648$ 2,565,270$ 13,325,186$ 18,961,826$ 22,043,301$ 77,669,231$
Accounts payable 1,199,118$ -$ 8,962,995$ 874,818$ 1,192,477$ 12,229,408$
Accrued liabilities 1,711,253 - -- 223,774 1,935,027
Accrued interest payable - 3,010 - - - 3,010
Total liabilities 2,910,371 3,010 8,962,995 874,818 1,416,251 14,167,445
Unavailable revenue - property taxes 386,235 146,881 - - - 533,116
Unavailable revenue - other 503,427 - - - 4,612 508,039
Total deferred inflows of resources 889,662 146,881 - - 4,612 1,041,155
Nonspendable
Prepaids, deposits, and inventories 74,835 - - - - 74,835
Restricted for
Debt service - 2,415,379 - - 1,013,861 3,429,240
Capital projects 2,686 - - 17,567,014 1,719,996 19,289,696
Developer agreements - - - - 2,240,942 2,240,942
Court technology 130,268 - - - - 130,268
Juvenile case management - - - - 280,877 280,877
Cable PEG fees - - - - 786,074 786,074
Historical preservation - - - - 1,245 1,245
Assigned 135,720 - 4,362,191 519,994 14,579,443 19,597,348
Unassigned 16,630,106 - -- - 16,630,106
Total fund balances 16,973,615 2,415,379 4,362,191 18,087,008 20,622,438 62,460,631
Total liabilities, deferred inflows of resources,
and fund balances 20,773,648$ 2,565,270$ 13,325,186$ 18,961,826$ 22,043,301$ 77,669,231$
ASSETS
LIABILITIES
DEFERRED INFLOWS OF RESOURCES
FUND BALANCES
CITY OF EULESS, TEXAS
RECONCILIATION OF THE GOVERNMENTAL FUNDS
BALANCE SHEET TO THE STATEMENT OF NET POSITION
SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
21
Total fund balances - governmental funds 62,460,631$
Capital assets of governmental funds are not current financial resources and
therefore are not reported in the governmental funds balance sheet. 152,182,519
Interest payable on long-term debt does not require current financial resources,
therefore interest payable is not reported as a liability in the governmental funds
balance sheet.(302,688)
Internal service funds are used by management to charge the cost of certain
activities,such as insurance and fleet management,to individual funds.The assets
and liabilities of the internal service funds are net of the amount allocated to
business-type activities.14,369,817
Revenues earned but not available within sixty days of the year end are not
recognized as revenue on the fund financial statements.1,041,155
Funds comprising the OPEB liability ($9,874,248),deferred inflows ($403,699)
and deferred outflows $909,802 of resources related to the OPEB are not current
financial resources and therefore are not reported in the governmental funds
balance sheet.(9,368,145)
(16,190,209)
Long-term liabilities,including bonds payable,deferred charges on refundings,and
compensated absences (excluding those of internal service funds)are not due and
payable in the current period and therefore are not reported in the fund financial
statements.(60,219,046)
Net position of governmental activities 143,974,034$
Amounts reported for governmental activities in the statement of net position are
different because:
Funds comprising the net pension liability ($27,058,083), deferred inflows
($487,937) and deferred outflows $11,355,811 of resources related to the
pension are not current financial resources and therefore are not reported in the
governmental funds balance sheet.
CITY OF EULESS, TEXAS
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES – GOVERNMENTAL FUNDS
YEAR ENDED SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
22
Debt Car Streets Non-major Total
General Service Rental Tax CIP Governmental Governmental
Fund Fund Fund Fund Funds Funds
Revenues
General property tax 15,193,545$ 3,896,571$ -$ -$ 1,318,465$ 20,408,581$
Gross receipts tax 4,439,903 - - - 950,710 5,390,613
Mixed beverage tax 138,219 - - - -138,219
General sales tax 13,038,632 - - - 8,381,199 21,419,831
Car rental tax - - 14,797,320 - -14,797,320
Fines and fees 3,313,059 - - - -3,313,059
Licenses and permits 2,105,716 - - - -2,105,716
Investment income 442,141 114,585 231,387 379,171 456,623 1,623,907
DEA revenues - - - - 18,353 18,353
Intergovernmental 422,585 - - 15,600 191,147 629,332
Rents and royalties - 516,750 - - 118,803 635,553
Other revenues 1,141,965 - - - 1,220,765 2,362,730
Total revenues 40,235,765 4,527,906 15,028,707 394,771 12,656,065 72,843,214
Expenditures
Current
Culture and recreation 3,308,005 - - - 2,950,487 6,258,492
Development services 764,542 - - - 237,045 1,001,587
General and administrative 8,476,030 - 9,843,484 - 718,986 19,038,500
Highways and streets 1,366,556 - -3,189,179 - 4,555,735
Public safety 24,818,499 - -- 2,919,739 27,738,238
Debt service
Principal - 4,718,848 - - 110,000 4,828,848
Interest and fiscal charges - 1,893,060 - - 50,435 1,943,495
Capital outlay 550,634 - - 2,207,806 6,220,608 8,979,048
Total expenditures 39,284,266 6,611,908 9,843,484 5,396,985 13,207,300 74,343,943
Excess (deficiency) of
revenues over (under) expenditures 951,499 (2,084,002) 5,185,223 (5,002,214) (551,235) (1,500,729)
Other financing sources (uses)
Issuance of debt - - - 11,785,000 1,635,000 13,420,000
Premiums on issuance of debt - 192,082 - 638,813 39,041 869,936
Proceeds from sale of assets 8,145 - - - 17,480 25,625
Transfers in 2,970,891 2,393,158 - 1,050,000 4,626,552 11,040,601
Transfers out (1,511,613) - (5,531,658) - (3,770,180) (10,813,451)
Total other financing sources (uses)1,467,423 2,585,240 (5,531,658) 13,473,813 2,547,893 14,542,711
Net change in fund balances 2,418,922 501,238 (346,435) 8,471,599 1,996,658 13,041,982
Fund balances, beginning of year 14,554,693 1,914,141 4,708,626 9,615,409 18,625,780 49,418,649
Fund balances, end of year 16,973,615$ 2,415,379$ 4,362,191$ 18,087,008$ 20,622,438$ 62,460,631$
CITY OF EULESS, TEXAS
RECONCILIATION OF THE STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES OF
GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
YEAR ENDED SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
23
Net change in fund balances - total governmental funds 13,041,982$
Governmental funds report capital outlays as expenditures.However,in the statement of
activities the cost of those assets is allocated over the estimated useful lives and reported
as depreciation expense.This is the amount of capital expenditures recorded in the
current period.8,979,048
Governmental funds report cash proceeds from the disposal of capital assets as revenues,
while only the net gain/loss on the transaction is reported in the statement of activities and
capital contributions are not reported in governmental funds.This is the amount of capital
contributions and disposals recorded in the current period.981,045
Depreciation expense on capital assets is reported in the statement of activities but does
not require the use of current financial resources.Therefore,depreciation expenses are
not reported as expenditures in the governmental funds.(5,574,654)
The issuance of long-term debt provides current financial resources to governmental
funds, but has no effect on net position.(13,420,000)
The repayment of the principal of long-term debt consumes current financial resources of
governmental funds, but has no effect on net position.4,828,848
Governmental funds report the effect of premiums,discounts,and deferred charges on
refunding when debt is first issued,whereas the amounts are deferred and amortized in
the statement of activities.(792,687)
Current year changes in the long-term liabilities for compensated absences do not require
the use of current financial resources;therefore,they are not reported as expenditures in
governmental funds.(4,468)
Current year changes in accrued interest payables do not require the use of current
financial resources;therefore,they are not reported as expenditures in governmental
funds.(67,319)
Changes in the OPEB liability and related deferred inflows and outflows not recognized
on the fund financial statements under the modified accrual basis are recognized on the
accrual basis in the government-wide financial statements.87,178
Changes in the net pension liability and related deferred inflows and outflows not
recognized on the fund financial statements under the modified accrual basis are
recognized on the accrual basis in the government-wide financial statements.(2,135,977)
Internal service funds are used by management to charge the costs of certain activities,
such as insurance and fleet management,to individual funds.The net revenue of the
internal service funds is reported with governmental activities net of the amount allocated
to business-type activities.1,126,233
Certain revenues in the government-wide statement of activities that do not provide
current financial resources are not reported as revenue in the governmental funds.(105,189)
Change in net position of governmental activities 6,944,040$
Amounts reported for governmental activities in the statement of activities are different
because:
CITY OF EULESS, TEXAS
STATEMENT OF NET POSITION – PROPRIETARY FUNDS
SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
24
Water and Drainage
Wastewater Utility
Current assets
Deposits and investments 16,997,082$ 1,473,419$
Accounts receivable and unbilled revenue
less allowance for uncollectibles of
$13,647 for water and wastewater and
$250 for drainage utility 4,038,843 95,272
Accrued interest receivable 92,164 -
Prepaids and deposits 10,500 45
Inventory 119,375 -
Total unrestricted current assets 21,257,964 1,568,736
Restricted deposits and investments
W&WW impact fees 3,047,942 -
Capital projects 10,646,450 -
Revenue bond reserve for debt service 1,426,830 -
Total restricted assets 15,121,222 -
Total current assets 36,379,186 1,568,736
Property, plant, and equipment in service, at cost
Land 1,576,667 559,826
Building 97,094 -
Equipment 1,664,603 10,380
Improvements 1,097,773 1,171,994
Construction in progress 5,207,167 -
Utility system 87,683,233 28,322,975
Total property, plant, and equipment in service 97,326,537 30,065,175
Less accumulated depreciation 46,001,578 15,742,088
Net property, plant, and equipment in service 51,324,959 14,323,087
Total non-current assets 51,324,959 14,323,087
Total assets 87,704,145 15,891,823
Deferred outflows related to pension 1,624,257 187,557
Deferred outflows related to OPEB 125,835 14,222
Deferred charges on refunding 92,786 -
Total deferred outflows of resources 1,842,878 201,779
ASSETS
DEFERRED OUTFLOWS OF RESOURCES
Business - Type Activities -
Enterprise Funds
(1 of 2)
25
Governmental
Activities -
Other Total Internal
Golf Recreation Enterprise Service
Course Enterprises Funds Funds
1,103,511$ 1,749,669$ 21,323,681$ 11,981,659$
182,771 9,908 4,326,794 92,922
- - 92,164 17,436
7,415 14,327 32,287 62,157
100,416 26,504 246,295 -
1,394,113 1,800,408 26,021,221 12,154,174
- - 3,047,942 -
- - 10,646,450 -
- - 1,426,830 -
- - 15,121,222 -
1,394,113 1,800,408 41,142,443 12,154,174
897,520 584,532 3,618,545 -
3,621,666 488,275 4,207,035 -
596,355 1,688,576 3,959,914 14,416,755
8,863,125 10,504,868 21,637,760 -
- - 5,207,167 -
- - 116,006,208 -
13,978,666 13,266,251 154,636,629 14,416,755
7,933,393 6,114,951 75,792,010 8,707,374
6,045,273 7,151,300 78,844,619 5,709,381
6,045,273 7,151,300 78,844,619 5,709,381
7,439,386 8,951,708 119,987,062 17,863,555
318,450 54,155 2,184,419 -
25,922 4,320 170,299 -
371,055 - 463,841 -
715,427 58,475 2,818,559 -
Business - Type Activities -
Enterprise Funds
CITY OF EULESS, TEXAS
STATEMENT OF NET POSITION – PROPRIETARY FUNDS
SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
26
Water and Drainage
Wastewater Utility
Current liabilities
Payable from current assets
Accounts payable 3,019,673$ 5,246$
Accrued salaries and wages 255,300 30,449
Current portion of bonds payable 1,180,000 -
Current portion of compensated absences 26,457 1,674
Accrued insurance claims - -
Unearned revenue - -
Accrued interest 106,094 -
Total current liabilities 4,587,524 37,369
Non-current liabilities
Customer and escrow deposits 2,020,022 -
Net pension liability 3,836,919 421,229
Net OPEB liability 1,358,508 152,204
Bonds payable 18,706,994 -
Compensated absences 238,111 15,065
Total non-current liabilities 26,160,554 588,498
Total liabilities 30,748,078 625,867
Deferred inflows related to pensions 67,324 7,463
Deferred inflows related to OPEB 55,551 6,226
Total deferred inflows of resources 122,875 13,689
NET POSITION
Net investment in capital assets 42,177,201 14,323,087
Restricted for
Impact fees 3,047,942 -
Capital projects 10,646,450 -
Debt service 1,426,830 -
Unrestricted 1,377,647 1,130,959
Total net position 58,676,070$ 15,454,046$
Reconciliation to government-wide statement of net position
Adjustment to reflect the consolidation of internal
service funds' activities related to enterprise funds
Net position of business-type activities
LIABILITIES
DEFERRED INFLOWS OF RESOURCES
Business - Type Activities -
Enterprise Funds
(2 of 2)
27
Governmental
Activities -
Other Total Internal
Golf Recreation Enterprise Service
Course Enterprises Funds Funds
70,538$ 48,988$ 3,144,445$ 300,317$
52,705 30,481 368,935 9,907
490,000 - 1,670,000 -
6,522 653 35,306 576
- - - 435,843
97,514 - 97,514 -
13,310 - 119,404 -
730,589 80,122 5,435,604 746,643
117,137 - 2,137,159 -
734,367 123,363 5,115,878 -
281,110 46,852 1,838,674 -
3,956,219 - 22,663,213 -
58,698 5,880 317,754 5,187
5,147,531 176,095 32,072,678 5,187
5,878,120 256,217 37,508,282 751,830
13,758 2,315 90,860 -
11,493 1,916 75,186 -
25,251 4,231 166,046 -
1,970,109 7,151,300 65,621,697 5,709,381
- - 3,047,942 -
- - 10,646,450 -
- - 1,426,830 -
281,333 1,598,435 4,388,374 11,402,344
2,251,442$ 8,749,735$ 85,131,293 17,111,725$
2,741,905
87,873,198$
Business - Type Activities -
Enterprise Funds
CITY OF EULESS, TEXAS
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION –
PROPRIETARY FUNDS
YEAR ENDED SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
28
Water and Drainage
Wastewater Utility
Operating revenues
Water service 13,859,748$ -$
Reclaimed water service 498,987 -
Wastewater service 9,694,746 -
Drainage fees - 826,711
Recreation fees - -
Insurance premiums - -
Service fees and miscellaneous 2,347,250 -
Total operating revenues 26,400,731 826,711
Operating expenses
General and administrative 495,567 -
Water production 7,474,888 -
Water distribution 1,168,841 -
Utility engineering 612,694 -
Wastewater collection and treatment 5,070,324 -
Nondepartmental 4,346,681 -
Geographic information systems 627,879 -
Service center 1,209,424 -
Drainage - 764,267
Recreation classes - -
Golf course - -
Pro shop - -
Food and beverage - -
Conference center - -
Cart operations - -
Texas Star Sports Complex - -
Arbor Daze - -
Insurance costs - -
Depreciation 2,110,195 779,768
Amortization 19,843 -
Total operating expenses 23,136,336 1,544,035
Operating income (loss)3,264,395 (717,324)
Business - Type Activities -
Enterprise Funds
29
Governmental
Activities -
Other Total Internal
Golf Recreation Enterprise Service
Course Enterprises Funds Funds
-$ -$ 13,859,748$ -$
- - 498,987 -
- - 9,694,746 -
- - 826,711 -
- 780,800 780,800 -
- - - 6,465,300
4,067,025 1,417,125 7,831,400 2,453,398
4,067,025 2,197,925 33,492,392 8,918,698
- - 495,567 1,942,396
- - 7,474,888 -
- - 1,168,841 -
- - 612,694 -
- - 5,070,324 -
- - 4,346,681 -
- - 627,879 -
- - 1,209,424 -
- - 764,267 -
- 737,270 737,270 -
1,758,613 - 1,758,613 -
449,890 - 449,890 -
1,191,259 - 1,191,259 -
564,083 - 564,083 -
216,196 - 216,196 -
- 980,199 980,199 -
- 60,247 60,247 -
- - - 5,582,123
398,547 476,148 3,764,658 1,387,290
27,480 - 47,323 -
4,606,068 2,253,864 31,540,303 8,911,809
(539,043) (55,939) 1,952,089 6,889
Business - Type Activities -
Enterprise Funds
CITY OF EULESS, TEXAS
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION –
PROPRIETARY FUNDS – CONTINUED
YEAR ENDED SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
30
Water and Drainage
Wastewater Utility
Nonoperating revenues (expenses)
Gain on sale of capital assets -$ -$
Investment income 645,791 33,842
Interest expense (246,576) -
Total nonoperating revenues
(expenses), net 399,215 33,842
Income (loss) before contributions
and transfers 3,663,610 (683,482)
Developer contributions 2,637,827 420,464
Transfers in - -
Transfers out (1,531,265) (41,541)
Net income (loss)4,770,172 (304,559)
Net position, beginning 53,905,898 15,758,605
Net position, end of year 58,676,070$ 15,454,046$
Reconciliation to government-wide statement of net position
Adjustment to reflect the consolidation of internal
service funds' activities related to enterprise funds
Change in net position of business-type activities
Enterprise Funds
Business - Type Activities -
31
Governmental
Activities -
Other Total Internal
Golf Recreation Enterprise Service
Course Enterprises Funds Funds
7,490$ 2,010$ 9,500$ 106,820$
27,378 39,854 746,865 258,791
(111,819) - (358,395) -
(76,951) 41,864 397,970 365,611
(615,994) (14,075) 2,350,059 372,500
- - 3,058,291 -
451,309 58,835 510,144 860,673
- - (1,572,806) (25,161)
(164,685) 44,760 4,345,688 1,208,012
2,416,127 8,704,975 15,903,713
2,251,442$ 8,749,735$ 17,111,725$
81,779
4,427,467$
Enterprise Funds
Business - Type Activities -
CITY OF EULESS, TEXAS
STATEMENT OF CASH FLOWS – PROPRIETARY FUNDS
YEAR ENDED SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
32
Water and Drainage
Wastewater Utility
OPERATING ACTIVITIES
Cash received from customers 26,113,020$ 831,338$
Cash payments to suppliers for goods and services (17,977,928) (323,045)
Cash payments to employees for services (3,512,487) (395,366)
Net cash provided by
operating activities 4,622,605 112,927
NONCAPITAL FINANCING ACTIVITIES
Transfer in - -
Transfer out (1,531,265) (41,541)
Net cash provided by (used in)
noncapital financing activities (1,531,265) (41,541)
CAPITAL AND RELATED FINANCING ACTIVITIES
Proceeds from bond issuances 9,275,000 -
Impact fees 557,093 -
Purchase of capital assets (6,501,617) (152,369)
Interest paid on bonds (191,327) -
Principal paid on bonds (915,000) -
Capital grant and developer contributions 2,080,734 -
Proceeds from sale of capital assets - -
Net cash provided by (used in) capital
and related financing activities 4,304,883 (152,369)
INVESTING ACTIVITIES
Interest received on investments 617,467 33,842
Net cash provided by investing activities 617,467 33,842
Net change in cash and cash equivalents 8,013,690 (47,141)
Cash and cash equivalents, beginning of year 24,104,614 1,520,560
Cash and cash equivalents, end of year 32,118,304$ 1,473,419$
Business - Type Activities -
Enterprise Funds
33
Governmental
Activities -
Other Total Internal
Golf Recreation Enterprise Service
Course Enterprises Funds Funds
4,109,683$ 2,215,370$ 33,269,411$ 8,873,569$
(2,297,265) (1,186,634) (21,784,872) (7,626,149)
(1,806,418) (542,447) (6,256,718) (140,774)
6,000 486,289 5,227,821 1,106,646
451,309 58,835 510,144 860,673
- - (1,572,806) (25,161)
451,309 58,835 (1,062,662) 835,512
- - 9,275,000 -
- - 557,093 -
(216,793) (60,574) (6,931,353) (1,141,662)
(113,600) - (304,927) -
(475,000) - (1,390,000) -
- - 2,080,734 -
7,490 2,010 9,500 106,820
(797,903) (58,564) 3,296,047 (1,034,842)
27,378 39,854 718,541 270,713
27,378 39,854 718,541 270,713
(313,216) 526,414 8,179,747 1,178,029
1,416,727 1,223,255 28,265,156 10,803,630
1,103,511$ 1,749,669$ 36,444,903$ 11,981,659$
Business - Type Activities -
Enterprise Funds
CITY OF EULESS, TEXAS
STATEMENT OF CASH FLOWS – PROPRIETARY FUNDS – CONTINUED
YEAR ENDED SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
34
Water and Drainage
Wastewater Utility
Reconciliation of operating income (loss)
to net cash provided by
operating activities
Operating income (loss)3,264,395$ (717,324)$
Adjustments to reconcile operating
income (loss) to net cash provided
by operating activities:
Depreciation and amortization 2,130,038 779,768
Changes in assets and liabilities:
Accounts receivable and
unbilled revenue (387,481) 4,627
Prepaids and deposits (9,000) (45)
Inventory 11,431 -
Net OPEB liability (7,571) (891)
Net pension liability 2,095,985 246,587
Deferred outflows (1,183,044) (143,158)
Deferred inflows (617,892) (68,491)
Accounts payable (367,359) 2,056
Accrued salaries and wages 56,422 5,270
Accrued insurance claims - -
Compensated absences 10,211 4,528
Customer and escrow
deposits 99,770 -
Unearned revenue (473,300) -
Net cash provided by
operating activities 4,622,605$ 112,927$
Noncash financing activities
Developer contributed assets 2,080,734$ 420,464$
Reconciliation of cash to balance sheet:
Cash - current 16,997,082$ 1,473,419$
Cash - restricted 15,121,222 -
Cash and cash equivalents 32,118,304$ 1,473,419$
Business - Type Activities -
Enterprise Funds
35
Governmental
Activities -
Other Total Internal
Golf Recreation Enterprise Service
Course Enterprises Funds Funds
(539,043)$ (55,939)$ 1,952,089$ 6,889$
426,027 476,148 3,811,981 1,387,290
12,712 17,445 (352,697) (45,129)
(580) - (9,625) (56,957)
832 2,053 14,316 -
(1,527) (254) (10,243) -
422,720 70,453 2,835,745 -
(236,246) (21,071) (1,583,519) -
(126,930) (39,375) (852,688) -
2,406 27,182 (335,715) (14,770)
11,499 10,739 83,930 4,323
- - - (175,000)
4,184 (1,092) 17,831 -
29,240 - 129,010 -
706 - (472,594) -
6,000$ 486,289$ 5,227,821$ 1,106,646$
-$ -$ 2,501,198$ -$
1,103,511$ 1,749,669$ 21,323,681$ 11,981,659$
- - 15,121,222 -
1,103,511$ 1,749,669$ 36,444,903$ 11,981,659$
Business - Type Activities -
Enterprise Funds
CITY OF EULESS, TEXAS
STATEMENT OF NET POSITION – FIDUCIARY FUNDS
SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
36
Stars Center Escrow OPEB
Agency Fund Trust Fund
ASSETS
Investments at fair value
Money market account 1,428,593$ 296,533$
Fixed income funds - 2,853,404
Equity funds - 4,263,427
Total assets 1,428,593$ 7,413,364$
LIABILITIES
Due to other entities 1,420,547$ -$
Refunds payable 8,046 -
Total liabilities 1,428,593$ -
NET POSITION
Held in trust for OPEB 7,413,364$
CITY OF EULESS, TEXAS
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
OPEB TRUST FUND
YEAR ENDED SEPTEMBER 30, 2019
The Notes to the Basic Financial Statements
are an integral part of these statements.
37
OPEB
Trust Fund
ADDITIONS
Employer contributions 1,583,715$
Other contributions 278,259
Investment income
Net increase in fair value of investments 312,243
Less: investment expense (35,867)
Total investment income 276,376
Total additions 2,138,350
DEDUCTIONS
Insurance claims 1,027,986
Administrative expenses 135,118
Total deductions 1,163,104
Change in net position 975,246
Net position - beginning 6,438,118
Net position - ending 7,413,364$
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
38
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General Statement
The City of Euless (the City) was incorporated on February 24, 1953. The City operates under a
Council-Manager form of government and provides the following services as authorized by its
charter: general government, police and fire protection, emergency ambulance service, road and
traffic signal maintenance, water and wastewater operations, drainage system, parks and
recreational facilities, courts, library services, planning land use, building inspection, and traffic
control.
The accounting and reporting policies of the City relating to the funds included in the
accompanying basic financial statements conform to accounting principles generally accepted in
the United States of America (GAAP) applicable to state and local governments. GAAP for local
governments include those principles prescribed by the Governmental Accounting Standards
Board (GASB) and the American Institute of Certified Public Accountants in the publication
entitled Audits of State and Local Governmental Units.
The more significant accounting policies of the City are described as follows:
Financial Reporting Entity
As required by GAAP, these basic financial statements present the primary government and its
component units, entities for which the government is considered to be financially accountable.
The blended component units, although legally separate entities, are, in substance, part of the
primary government’s operations. As such, data from these units is combined with data of the
primary government.
Blended Component Units
The City includes four component units in the financial statements. The Euless Development
Corporation (Corporation) is used to account for the accumulation of half-cent sales tax
proceeds dedicated to building and improving City parks and facilities, enhancing library
services, and stimulating economic development activities within the City. The Euless Crime
Control and Prevention District (District) is used to account for the accumulation and use of
quarter-cent sales tax proceeds dedicated for crime reduction programs. The Corporation and
the District are reported as special revenue funds of the primary government. The Boards of
Directors of both component units are substantively the same as the City Council. There are
seven directors on each board, four of whom are council members which constitutes a voting
majority of the City Council. The remaining three board members are residents of the City.
Upon dissolution of the Corporation or the District, the entity’s assets will be distributed to
the City. Each component unit provides all of its services to the City. The financial
statements for the units were obtained from the respective Boards of Directors. Financial
information for both entities may be obtained from the City.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
39
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Financial Reporting Entity – Continued
Blended Component Units – Continued
The Tax Increment Reinvestment Zone #3 - Glade Parks (TIRZ #3) is also a blended
component unit of the City and is reflected in the financial statements as a special revenue
fund. TIRZ #3 was created to stimulate development and enhance the value of taxable real
property within the boundaries of the zone. Tarrant County and Tarrant County College
District are taxing entities participating in TIRZ #3. The Board of Directors of TIRZ #3 is
substantially the same as the City Council, and management of the City has operational
responsibility for TIRZ #3. The Board is comprised of seven directors, four of whom are
council members which constitutes a voting majority of the Board. The remaining three
board members are representatives selected by the other participating taxing entities and the
Tarrant County Hospital District. Financial information for TIRZ #3 may be obtained from
the City.
The Tax Increment Reinvestment Zone #4 – Midtown (TIRZ #4) is also a blended
component unit of the City and is reflected in the financial statements as a special revenue
fund. The Midtown CIP Fund is also part of TIRZ#4. TIRZ #4 was created to stimulate
development and enhance the value of taxable real property within the boundaries of the
zone. Tarrant County, Tarrant County Hospital District, and Tarrant County College District
are taxing entities participating in TIRZ #4. The Board of Directors of TIRZ #4 is
substantially the same as the City Council, and management of the City has operational
responsibility for TIRZ #4. The Board is comprised of seven directors, four of whom are
council members which constitutes a voting majority of the Board. The remaining three
board members are representatives selected by the other participating taxing entities.
Financial information for TIRZ #4 may be obtained from the City.
Basis of Presentation
The government-wide financial statements (the statement of net position and the statement of
activities) report information on all of the activities of the City, except fiduciary funds. The
effect of interfund activity, with the exception of interfund services provided or used, within the
governmental and business-type activities columns, has been removed from these statements.
Governmental activities, which normally are supported by taxes and intergovernmental revenues,
are reported separately from business-type activities, which rely to a significant extent on user
fees and charges for support.
The statement of activities demonstrates the degree to which the direct expenses of a given
program are offset by program revenues. Direct expenses are those that are clearly identifiable
with a specific program. Program revenues include 1) charges to customers or applicants who
purchase, use, or directly benefit from goods, services, or privileges provided by a given program
and 2) operating or capital grants and contributions that are restricted to meeting the operational
or capital requirements of a particular program. Taxes and other items not properly included
among program revenues are reported instead as general revenues.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
40
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Basis of Presentation – Continued
Fund Financial Statements
The City segregates transactions related to certain functions or activities in separate funds in
order to aid financial management and to demonstrate compliance with various legal
provisions. Separate statements are presented for governmental funds, proprietary funds, and
fiduciary funds, even though the latter are excluded from the government-wide financial
statements. These statements present each major fund as a separate column on the fund
financial statements; all non-major funds are aggregated and presented in a single column.
Governmental funds are those funds through which most governmental functions are
typically financed. The measurement focus of governmental funds is on the sources, uses ,
and balances of current financial resources. The City has presented the following major
governmental funds:
General Fund
The General Fund is the main operating fund of the City. This fund is used to account for
all financial resources not accounted for in other funds. All general tax revenues and
other receipts that are not restricted by law or contractual agreement to some other fund
are accounted for in this fund. General operating expenditures, fixed charges, and capital
improvement costs that are not paid through other funds are paid from the General Fund.
Debt Service Fund
The Debt Service Fund is used to account for the accumulation of financial resources for
the payment of principal, interest, and related costs on general long-term debt paid
primarily from property taxes levied by the City. The fund balance of the Debt Service
Fund is restricted for debt service expenditures.
Car Rental Tax Fund
The Car Rental Tax Fund is used to account for revenues received from the collection of
short-term motor vehicle rental taxes and the expenditures thereof. Per contractual
agreement, revenues are shared with the cities of Dallas and Fort Worth. The City’s
portion of the revenue is used primarily for debt reduction, one-time capital projects, and
to maintain the property tax rate.
Streets CIP Fund
The Streets CIP Fund is used to account for street construction and reconstruction
projects and the means of financing such improvements.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
41
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Basis of Presentation – Continued
Proprietary funds are accounted for using the economic resources measurement focus and the
accrual basis of accounting. The accounting objectives are determinations of net income,
financial position, and cash flow. All assets and liabilities are included on the statement of
net position. The City has presented the following major proprietary funds:
Water and Wastewater Fund
Water and Wastewater Fund is used to account for the acquisition, operation and
maintenance of a municipal water and wastewater utility, supported primarily by user
charges.
Drainage Utility Fund
Drainage Utility Fund is used to account for the acquisition, operation, and maintenance
of a municipal drainage utility, supported primarily by user charges.
Golf Course Fund
Golf Course Fund is used to account for operation and maintenance of the City’s golf
course, supported primarily by user charges.
Other Recreation Enterprises Fund
Other Recreation Enterprises Fund is used to account for operations and maintenance of
recreation programming, Arbor Daze, and the Texas Star Sports Complex , supported by
user charges.
Additionally, the City reports the Internal Service Funds which are used to account for
equipment replacement, risk management, and self-funded health insurance coverage and
disability insurance provided to employees of the City.
Proprietary funds distinguish operating revenues and expenses from non-operating items.
Operating revenues and expenses generally result from providing services and producing and
delivering goods in connection with a proprietary fund’s principal ongoing operations.
Operating expenses for the proprietary funds include the cost of personnel and contractual
services, supplies, and depreciation on capital assets. All revenues and expenses not meeting this
definition are reported as non-operating revenues and expenses.
The City also reports two fiduciary funds in the financial statements. The Stars Center Escrow
Fund accounts for investments that will be held on behalf of the Dallas Stars until the debt issued
for the specific purpose of purchasing the Stars Center is fully repaid. The OPEB Trust Fund
accounts for the accumulation and use of resources for benefit payments related t o post-
employment health care.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
42
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Measurement Focus and Basis of Accounting
Measurement focus refers to what is being measured; basis of accounting refers to when
revenues and expenditures/expenses are recognized in the accounts and reported in the financial
statements. Basis of accounting relates to the timing of the measurement made, regardless of the
measurement focus applied.
The government-wide and proprietary fund financial statements are reported using the economic
resources measurement focus and the accrual basis of accounting. The economic resources
measurement focus means all assets, deferred inflows/outflows of resources, and liabilities
(whether current or noncurrent) are included on the statement of net position and the operating
statements present increases and decreases in total net position. Under the accrual basis of
accounting, revenues are recognized when earned, including unbilled water, wastewater, and
drainage services which are accrued. Expenses are recognized at the time the liability is
incurred.
Governmental fund financial statements are reported using the current financial resources
measurement focus and are accounted for using the modified accrual basis of accounting. Under
the modified accrual basis of accounting, revenues are recognized when susceptible to accrual;
i.e., become both measurable and available. “Measurable” means the amount of the transaction
can be determined and “available” means collectible within the current period or soon enough
thereafter to be used to pay liabilities of the current period. The City considers property taxes
and other revenues as available if they are collected within 60 days of year end. Expenditures are
recorded when the related fund liability is incurred. However, debt service expenditures, as well
as expenditures related to compensated absences and other long-term liabilities are recorded only
when payment is due.
The significant revenues susceptible to accrual are property taxes, franchise fees, licenses,
charges for service, interest income, and intergovernmental revenues. Sales taxes and short-term
motor vehicle rental taxes collected and held by the state at year end on behalf of the City are
also recognized as revenue. All other governmental fund revenues are recognized when
received.
Deposits and Investments
Substantially all operating cash, deposits, and short-term investments are maintained in
consolidated cash accounts or individual fund investment accounts. Related interest income is
allocated to the various funds based primarily on ownership by each fund of specific
investments. Cash equivalents consist of highly-liquid investments with original maturities of
three months or less.
For purposes of the statement of cash flows, the City considers all highly liquid investments to
be cash equivalents.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
43
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Deposits and Investments – Continued
Investments in U.S. Treasury and agency obligations with maturities of one year or less when
purchased are reported at amortized cost. All other investments are reported at fair value.
State statutes authorize the City to invest in obligations of the U.S. Government or its agencies;
obligations of the State of Texas or its agencies; and certain other obligations, repurchase
agreements, money market mutual funds, and certificates of deposits within established criterion.
Property Taxes
Property taxes are levied for appropriation for the fiscal year beginning on October 1, are due
October 1, attach as an enforceable lien on property as of January 1, and become delinquent on
February 1. Property taxes are accrued based on the period for which they are levied and
available. Delinquent taxes estimated not to be available are treated as deferred inflows of
resources. Property taxes for cities, including those applicable to debt service, are limited by the
Texas Constitution to $2.50 per $100 of assessed valuation. The City's current tax rate is
$0.4625 per $100 of assessed valuation ($0.4625 per $100 last year) and assessed valuation is
approximately 100% of estimated value.
Inventories
Inventories, which are recognized as expenditures/expenses as consumed, are stated at cost (first-
in, first-out method) for the General Fund, Enterprise Funds and Internal Service funds.
Inventories consist primarily of expendable supplies for the General Fund and Internal Service
funds and merchandise for resale for the Enterprise Funds.
Prepaid Items
Prepaid balances are for payments made by the City in the current year to provide services
occurring in the subsequent fiscal year, and are recognized as expenditures utilizing the
consumption method.
Interfund Receivables and Payables
Any residual balances outstanding between the governmental activities and business-type
activities are reported in the government-wide financial statements as “internal balances.”
Transactions Between Funds
Interfund services provided and used are accounted for as revenues and expenditures or
expenses. Transactions that constitute reimbursements to a fund for expenditures or expenses
initially made from it that are properly applicable to another fund, are recorded as expenditures
or expenses in the reimbursing fund and as a reduction of expenditures or expenses in the fund
reimbursed. All other interfund transactions are recorded as transfers.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
44
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Capital Assets
Capital assets, which include property, plant, equipment, and infrastructure assets, are reported in
the applicable governmental or business-type activities columns in the government-wide
financial statements and in the fund financial statements for proprietary funds. All capital assets
are recorded at historical cost or estimated historical cost if actual historical cost is not available.
Donated assets are recorded at acquisition value on the date donated. Repairs and maintenance
are recorded as expenses. Renewals and betterments are capitalized. Interest has not been
capitalized during the construction period on property, plant, and equipment.
Assets capitalized have an original cost of $5,000 or more and over one year of useful life.
Depreciation has been calculated on each class of depreciable property using the straight-line
method. Estimated useful lives are as follows:
Buildings 33 1/3 years
Water and wastewater system 33 1/3 years
Storm drainage system 33 1/3 years
Infrastructure 7 - 40 years
Machinery and equipment 5 - 15 years
Improvements 25 years
Compensated Absences
Employees may accumulate a maximum of two times their annual vacation accrual. The City's
policy is to pay the employee accumulated vacation upon termination. The City does not pay
employees for accumulated sick leave upon termination. The short-term portion of vacation pay
accrued in the proprietary fund financial statements is reported as accrued salaries and wages (a
current liability). The long-term component is reflected in non-current liabilities as compensated
absences. Compensated absences are recorded in governmental funds as they mature (i.e. as
taken). The liability for governmental fund compensated absences is typically liquidated in the
general fund, the juvenile case fund, the half-penny sales tax fund, and the crime control and
prevention district fund.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
45
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Fund Balance Classifications
Fund balances are classified as follows on the governmental fund financial statements:
General Fund
Debt Service
Fund
Car Rental Tax
Fund Streets CIP Fund
Nonmajor
Governmental
Funds
Total
Governmental
Funds
Nonspendable 74,835$ -$ -$ -$ -$ 74,835$
Restricted for
Debt service - 2,415,379 - - 1,013,861 3,429,240
Capital projects 2,686 - - 17,567,014 1,719,996 19,289,696
Developer agreements - - - - 2,240,942 2,240,942
Court technology 130,268 - - - - 130,268
Juvenile case processing - - - - 280,877 280,877
Cable PEG fees - - - - 786,074 786,074
Historical preservation - - - - 1,245 1,245
Assigned
Capital projects - - - - 7,367,519 7,367,519
Betterments 51,906 - - - - 51,906
Emergency/radio systems 47,231 - - - - 47,231
Tourism and
conference facilities - - - - 508,112 508,112
Parks, library, and
economic development - - - - 3,251,852 3,251,852
Police department - - - - 2,098,787 2,098,787
Other 36,583 - 4,362,191 519,994 1,353,173 6,271,941
Unassigned 16,630,106 - - - - 16,630,106
Total 16,973,615$ 2,415,379$ 4,362,191$ 18,087,008$ 20,622,438$ 62,460,631$
Reported in
Nonspendable: This classification includes amounts that cannot be spent because they are either
(a) not in spendable form or (b) are legally or contractually required to be maintained intact. The
City has classified prepaid items and inventory as being nonspendable.
Restricted: This classification includes amounts for which constraints have been placed on the
use of the resources either (a) externally imposed by creditors (such as through a debt covenant),
grantors, contributors, or laws or regulations of other governments, or (b) imposed by law
through constitutional provisions or enabling legislation.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
46
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Fund Balance Classifications – Continued
The City has recorded the following restrictions at year-end:
a. Restricted for debt service represents that portion of fund equity legally restricted for
retirement of bond principal and payment of interest and related charges.
b. Restricted for capital projects represents that portion of fund equity legally restricted
by debt covenant for capital projects.
c. Restricted for developer agreements represents the portion of fund equity that must be
used for future improvements to various development areas within the City.
d. Restricted for court technology represents funds collected from a court technology fee
that must be used to upgrade court systems.
e. Restricted for juvenile case processing represents funds collected from a fee on
municipal court citations that must be used to support the expenditures associated
with juvenile case processing.
f. Restricted for cable PEG fees represents the portion of fund equity that must be used
for the expansion of the City’s public, educational, and government access channel.
g. Restricted for historical preservation represents donations that must be used toward
the preservation of the City’s historical sites.
Committed: This classification includes amounts that can be used only for specific purposes
pursuant to constraints imposed by formal action (ordinance) of the City Council. These
amounts cannot be used for an y other purpose unless the City Council removes or changes
the specified use by taking the same type of action that was employed when the funds were
initially committed. This classification also includes contractual obligations to the extent that
existing resources have been specifically committed for use in satisfying those contractual
requirements. The City has no committed fund balance at year-end.
Assigned: This classification includes amounts that are constrained by the City’s intended
use for a specific purpose but are neither restricted nor committed. The City Council
delegates the authority for determining this intent to the City Manager. Assignments are
made at the City Manager's discretion, but generally represent items for which specific funds
have been informally dedicated internally. This classification also includes the remaining
positive fund balance for all governmental funds except for the General Fund. The City has
recorded the following assignments at year-end:
a. Assigned for capital projects represents revenue sources that are to be used for capital
projects for the City.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
47
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Fund Balance Classifications – Continued
b. Assigned for betterment represents funds donated by citizens that are to be used for the
betterment of the community.
c. Assigned for emergency/radio systems represents funding that is to be used to upgrade
emergency and radio systems.
d. Assigned for tourism and conference facilities represents funds to promote the City
through tourism, conference booking, and historical preservation.
e. Assigned for parks, libraries, and economic development represents funds from sales
taxes that are to be used for park improvements, library activities, and economic
development throughout the City.
f. Assigned for the police department are funds from the Crime Control and Prevention
District and the sale of assets seized in connection with drug arrests to be used for police
department expenditures.
g. Assigned for other are funds from specific revenues that are to be spent for facility
remodel, victim assistance, and injured animals.
Unassigned: This classification includes all amounts that are not included in other spendable
classifications and the remaining negative fund balance for any governmental funds. The
General Fund is the only fund that reports a positive unassigned fund balance.
When available, the City uses restricted fund balances first, followed by committed
resources, assigned resources, then unassigned resources, as appropriate opportunities arise.
However, the City reserves the right to selectively spend unassigned resources first to defer
the use of these other classified funds.
Net Position
Net position represents the difference between assets and deferred outflows of resources and
liabilities and deferred inflows of resources of governmental and business-type activities and
proprietary funds. Net investment in capital assets consists of capital assets, net of accumulated
depreciation, plus capital-related deferred outflows of resources, reduced by the outstanding
balances of any borrowing and capital related deferred inflows of resources used for the
acquisition, construction, or improvements of those assets, plus unspent debt proceeds. Net
position is reported as restricted when there are limitations imposed on its use, either through the
enabling legislation adopted by the City or through external restrictions imposed by creditors,
grantors, or laws or regulations of other governments.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
48
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Pensions
For purposes of measuring the net pension liability, pension related deferred outflows and inflows
of resources, and pension expense, City specific information about its Fiduciary Net Position in the
Texas Municipal Retirement System (TMRS) and additions to/deductions from the City’s
Fiduciary Net Position have been determined on the same basis as they are reported by TMRS. For
this purpose, plan contributions are recognized in the period that compensation is reported for the
employee, which is when contributions are legally due. Benefit payments and refunds are
recognized when due and payable in accordance with the benefit terms. Investments are reported at
fair value. Information regarding the City’s Total Pension Liability is obtained from TMRS
through a report prepared for the City by TMRS consulting actuary, Gabriel Roeder Smith &
Company, in compliance with Governmental Accounting Standards Board (GASB) Statement No.
68, Accounting and Financial Reporting for Pensions.
Other Post-Employment Benefits (OPEB)
For purposes of measuring the net OPEB liability, OPEB related deferred outflows and inflows of
resources, and OPEB expense, City specific information about its Fiduciary Net Position and
additions to/deductions from the City’s Fiduciary Net Position have been determined on the same
basis as they are reported. For this purpose, plan contributions are recognized in the period that
compensation is reported for the employee, which is when contributions are legally due. Benefit
payments and refunds are recognized when due and payable in accordance with the benefit terms.
Investments are reported at fair value. Information regarding the City’s OPEB liability is obtained
from an actuarial valuation through a report prepared for the City by their consulting actuary in
compliance with Governmental Accounting Standards Board (GASB) Statement No. 75,
Accounting and Financial Reporting for Postemployment Benefits other than Pensions.
Deferred Outflows/Inflows of Resources
In addition to assets, the statement of net position will sometimes report a separate section for
deferred outflows of resources. This separate financial statement element, deferred outflows of
resources, represents a consumption of net position that applies to a future period(s) and so will not
be recognized as an outflow of resources (expense/expenditure) until then. The City has the
following items that qualify for reporting as deferred outflows of resources:
Deferred charges on refundings – a deferred charge on refunding results from the
difference in the carrying value of refunded debt and its reacquisition price. This amount is
deferred and amortized over the shorter of the life of the refunded debt or refunding debt.
Pension contributions after measurement date – these contributions are deferred and
recognized in the following fiscal year.
Difference in projected and actual investment earnings for pension assets – the difference is
deferred and amortized over a closed five-year period.
Difference in projected and actual earnings on OPEB assets – this difference is deferred
and amortized over a closed five-year period.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
49
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Deferred Outflows/Inflows of Resources - Continued
Difference in expected and actual OPEB experience – this difference is deferred and
amortized over a closed period that approximates the estimated average remaining lives of
all members on the measurement date.
In addition to liabilities, the statement of net position will sometimes report a separate section for
deferred inflows of resources. This separate financial statement element, deferred inflows of
resources, represents an acquisition of net position that applies to a future period(s) and so will not
be recognized as an inflow of resources (revenue) until that time.
The City has the following items that qualify for reporting as deferred inflows of resources:
Difference in expected and actual pension experience – this difference is deferred and
amortized over a closed period that approximates the estimated average remaining lives of
all members on the measurement date.
Difference in pension actuarial assumption changes – this difference is deferred and
amortized over a closed period that approximates the estimated average remaining lives of
all members on the measurement date.
Difference in OPEB actuarial assumption changes – this difference is deferred and
amortized over a closed period that approximates the estimated average remaining lives of
all members on the measurement date.
Tax Abatements
The City provides tax abatement programs through economic development agreements designed
to promote local economic development and redevelopment; spur economic improvement;
stimulate business and commercial activity within the City; retain, create, and attract jobs; train
and retrain employees of local businesses; generate additional sales tax and enhance the property
tax base and economic condition of the City. Agreements generally contain recapture provisions
which may require repayment or termination if the recipients do not meet the required
provisions.
As of September 30, 2019, the City has two categories of tax abatement programs for economic
development:
Tax Abatements – The City has designated tax reinvestment zones and negotiated tax abatement
agreements with applicants as authorized by the Texas Tax Code Chapter 312 and administered
through the City’s Tax Abatement Policy to promote development and redevelopment within the
City. Such abatement agreements authorize the appraisal district to reduce the assessed val ue of
the taxpayer’s property by a percentage specified in the agreement, and the taxpayer will pay
taxes on the lower assessed value during the term of the agreement. Recipients receiving tax
abatements generally commit to the creation of new value of eligible property improvements,
either for new or improved existing facilities, made subsequent to the agreement ranging from
35% to 75% for up to 10 years. No property taxes were abated under this program in fiscal year
2019.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
50
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED
Tax Abatements – Continued
General Economic Development Agreements – The City has entered into various agreements
under Texas Local Government Code Chapter 380 to stimulate economic development. Such
agreements may provide rebates, grants, or loans for promotion of economic development
including attracting new business and encouraging expansion or retention of existing businesses.
Rebates may be a flat amount or percentage of property taxes or sales taxes received by the City.
For fiscal year 2019 the City rebated $1,024,524 in sales taxes, or 4.8% of the total sales tax
revenues. These rebates are reflected in non-departmental expenditures in the general fund and in
general and administrative expenditures in the EDC fund.
NOTE 2. DEPOSITS AND INVESTMENTS
Deposits
State statutes and the City’s investment policy require that all uninsured deposits in financial
institutions be fully collateralized by U.S. Government obligations or its agencies or
instrumentalities or direct obligations of Texas or its agencies or instrumentalities that have a
market value of not less than the principal amount of the deposits or by a letter of credit issued
by a federal home loan bank. The City’s deposits were fully insured or collateralized as required
by state statutes as of September 30, 2019. At year-end, the carrying amount of the City’s
deposits was $11,189,358 with a bank balance of $11,111,783.
The total bank balance is covered by Federal Depository Insurance Corporation (FDIC)
insurance or by collateral for balances in excess of FDIC coverage. Collateral is held by Bank of
NY Mellon in the City’s name under a joint safekeeping agreement with Frost National Bank for
City deposits at Frost Bank. The market value of the collateral at the close of the fiscal year was
$1,356,365. The balances at Bank of Texas (BOT) are covered by FDIC insurance and collateral
pledged to cover the balances in the BOT short-term cash fund.
Investments
State statutes, City bond ordinances, and City resolutions authorize the City’s investments. The
City is authorized to invest in obligations of the U.S. Government and its agencies and
instrumentalities, obligations of the State of Texas and its agencies and instrumentalities, fully-
insured or collateralized certificates of deposit, fully-collateralized repurchase agreements and
reverse repurchase agreements, government pools, and no-load SEC-registered money market
funds consisting of any of these securities listed.
Because the City is responsible for the investment portfolio of its component units, the City’s
investment practices and policies disclosed herein apply equally to its component units. During
the year ended September 30, 2019, the City did not own any types of securities other than those
permitted by statute.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
51
NOTE 2. DEPOSITS AND INVESTMENTS – CONTINUED
Investments – Continued
Book Value
Fair Value
Level 2
% of
Portfolio WAM Rating
Rating
Agency
Interest bearing bank deposits $ 10,646,450 9%
Investments measured at amortized cost:
Investment Pools:
TexPool 31,018,143 26%34 AAAm S&P
TexSTAR 30,247,920 25%22 AAAm S&P
Investments measured at fair value:
U.S. Government Agency Securities:
FNMA 1,917,023 1,999,170 2%1 AA+/Aaa S&P/Moody's
FFCB 14,457,128 14,521,700 12%15 AA+/Aaa S&P/Moody's
FHLB 19,402,043 19,510,860 16%45 AA+/Aaa S&P/Moody's
FHLMC 9,224,091 9,257,465 8%42 AA+/Aaa S&P/Moody's
FAMCA 2,000,500 2,003,390 2%6
Total 118,913,298$ 47,292,585$ 100%
Investment Type
Not rated
Weighted average maturity (WAM) of the portfolio by investment type categories reflected in the previous table is stated in
days. For the investment pools, the Reset WAM is presented. Investment type acronyms displayed in the previous table are
defined as follows: FNMA – Federal National Mortgage Association, FFCB – Federal Farm Credit Bank, FHLB – Federal
Home Loan Bank, FHLMC – Federal Home Loan Mortgage Corporation, and FAMCA – Federal Agricultural Mortgage
Corporation. The rating agency acronyms are defined as follows: S&P – Standard and Poor’s Ratings Services, a division of
the McGraw-Hill Companies, Inc. and Moody’s – Moody’s Investor Service, Inc. Additional information about the rating
agency or the significance of the ratings provided may be obtained from the agency’s web site.
Fair Value
The City categorizes its fair value measurements within the fair value hierarchy established
by generally accepted accounting principles. GASB Statement No. 72, Fair Value
Measurement and Application provides a framework for measuring fair value which
establishes a three-level fair value hierarchy that describes the inputs that are used to measure
assets and liabilities.
Level 1 inputs are quoted prices (unadjusted) for identical assets or liabilities in active
markets that a government can access at the measurement date.
Level 2 inputs are inputs – other than quoted prices included within Level 1– that are
observable for an asset or liability, either directly or indirectly.
Level 3 inputs are unobservable inputs for an asset or liability.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
52
NOTE 2. DEPOSITS AND INVESTMENTS – CONTINUED
Investments – Continued
Fair Value – Continued
The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to
Level 3 inputs. If a price for an identical asset or liability is not observable, a government
should measure fair value using another valuation technique that maximizes the use of
relevant observable inputs and minimizes the use of unobservable inputs. If the fair value of
an asset or a liability is measured using inputs from more than one level of the fair value
hierarchy, the measurement is considered to be based on the lowest priority level input that is
significant to the entire measurement.
The City has recurring fair value measurements as presented in the previous table. The City’s
investment balances and weighted average maturity of such investments are as shown.
Investment pools are measured at amortized cost and are exempt from fair value reporting.
U.S. Government Agency Securities classified in Level 2 of the fair value hierarchy are
valued using a matrix pricing technique. Matrix pricing is used to value securities based on
the securities’ relationship to benchmark quoted prices.
Both of the public fund investment pools (pools) in which the City is a participant use
amortized cost to value the portfolio. Amortized cost, in most cases, approx imates the
market value of the securities held. In order to meet the criteria to be recorded at amortized
cost, investment pools must transact at a stable net asset value per share and maintain certain
maturity, quality, liquidity and diversification requirements within the investment pool. The
pools in which the City invests transact at a net asset value of $1.00 per share, have a
weighted average maturity of 60 days or less and weighted average life of 120 days or less,
hold investments that are highly rated by a nationally recognized statistical rating
organization, have no more than 5% of the portfolio with one issuer (excluding US
government securities), and can meet reasonably foreseeable redemptions.
The TexPool investment pool is an external investment pool valued at amortized costs.
TexPool, has a redemption notice period of one day and has no maximum transaction
amounts. The investment pools’ authorities may only impose restrictions on redemptions in
the event of a general suspension of trading on major securities markets, general banking
moratorium or national or state emergency that affects the pool’s liquidity.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
53
NOTE 2. DEPOSITS AND INVESTMENTS – CONTINUED
Investments – Continued
The TexSTAR investment pool is an external investment pool measured at amortized cost.
TexSTAR’s strategy is to seek preservation of principal, liquidity and current income through
investment in a diversified portfolio of short-term marketable securities. TexSTAR has a
redemption notice period of one day and may redeem daily. The investment pool’s authorities
may only impose restrictions on redemptions in the event of a general suspension of trading on
major securities markets, general banking moratorium or national or state emergency that affects
the pool’s liquidity.
TexPool falls under the purview of the Texas Comptroller of Public Accounts (Comptroller) who
is responsible for oversight of TexPool operations. Federated Investors is responsible for
managing pool assets and day-to-day operations. TexSTAR is duly chartered and administered
by HilltopSecurities Inc. and JP Investment Management, Inc. TexSTAR has established a
governing board that is partially comprised of pool participants. Duties of the governing board
include oversight responsibility. The Comptroller and the governing board exercise oversight of
the pools’ activities via daily, weekly, and monthly reporting requirements.
Additionally, per the requirements of the Public Funds Investment Act (PFIA), all pools will
maintain an AAA or equivalent rating from at least one nationally recognized rating agency. The
PFIA also requires an annual examination of the financial statements of the pools by an
independent certified public accounting firm. In connection with the financial audit, a
compliance audit of management controls on investments and adherence to the investment
policies is also required.
Interest Rate Risk
In compliance with the City’s Investment Policy, as of September 30, 2019, the City minimized
the interest rate risk, the risk relating to the decline in market value of securities in the portfolio,
by: limiting the weighted average maturity to 365 days and the stated maturity to two years or
less, with the exception of securities purchases related to reserve funds; structuring the
investment portfolio so that securities mature to meet cash requirements for ongoing operations,
thereby avoiding the need to sell securities in the secondary market prior to maturity; monitoring
credit ratings of portfolio positions to assure compliance with rating requirements imposed by
the PFIA; and investing funds primarily in money market mutual funds, government investment
pools, and shorter-term securities.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
54
NOTE 2. DEPOSITS AND INVESTMENTS – CONTINUED
Interest Rate Risk – Continued
The following table details the maturity schedule for the City’s investment portfolio as of
September 30, 2019:
Maturity Schedule Book Value Fair Value % of Portfolio
Overnight 71,912,513$ 71,912,513$ 60%
Less than 1 month 6,902,456 6,999,670 6%
1 to 6 months 15,409,732 15,516,850 13%
6 to 9 months 4,214,256 4,261,195 4%
9 to 12 months 3,975,091 4,002,540 3%
12 to 18 months 7,999,250 8,004,710 7%
Over 18 months 8,500,000 8,507,620 7%
Total 118,913,298$ 119,205,098$ 100%
Credit Risk
In compliance with the City’s Investment Policy, as of September 30, 2019, the City minimized
credit risk losses due to default of a security issuer or backer, by: limiting investments to the
safest types of securities; primarily investing in U.S. Agency Bonds rated AA+ by Standard &
Poor’s; pre-qualifying financial institutions, brokers/dealers, and advisors with which the City
will do business; and diversifying the investment portfolio so that the potential losses on
securities are minimized.
Custodial credit risk – risk that a government will not be able to recover (a) deposits if the
depository financial institution fails or (b) the value of investment or collateral securities that are
in the possession of an outside party if the counterparty to the investment or deposit transaction
fails. To minimize such risk, the City requires collateralization of deposits in excess of FDIC
coverage, utilizes the delivery vs. payment method for investment purchases, and contracts with
a third-party collateral safekeeping agent.
Per the terms of its depository agreement, for bank deposits in excess of the coverage provided
by the FDIC, the City requires the depository bank to pledge to the City securities (collateral)
equal to 105% of the largest balances the City maintains in the bank. The percentage as shown
reflects the requirement based on market value of the pledged securities. The City actively
monitors and manages collateral levels for all deposits. On September 30, 2019, the City’s bank
balances were fully insured or collateralized.
The City’s depository bank also acts as its safekeeping agent per the terms of the depository
contract. City policy dictates that all securities rendered for payment will be sent delivery vs.
payment, meaning that the funds required for purchase of a security will not be released until the
safekeeping agent has received the security purchased in the City’s name. No broker holds City
funds. The City does not purchase securities from its depository bank or any subsidiary banks of
the same bank holding company.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
55
NOTE 3. CAPITAL ASSETS
Capital asset activity for the year ended September 30, 2019, was as follows:
Balance Balance
Beginning Adjustment/End of
of Year Increase Decrease Transfer Year
Governmental activities
Capital assets not being depreciated
Land 32,538,668$ 526,938$ -$ 372,971$ 33,438,577$
Construction in progress 18,099,872 8,213,250 - (838,415) 25,474,707
Total capital assets
not being depreciated 50,638,540 8,740,188 - (465,444) 58,913,284
Capital assets being depreciated
Buildings 61,657,631 - (257,414) 435,444 61,835,661
Improvements other than buildings 13,575,426 211,447 - - 13,786,873
Infrastructure 90,924,715 688,112 - - 91,612,827
Machinery and equipment 10,575,260 592,085 (278,470) 30,000 10,918,875
Total capital assets
being depreciated 176,733,032 1,491,644 (535,884) 465,444 178,154,236
Less accumulated depreciation
Buildings (26,041,137) (1,790,878) 8,141 - (27,823,874)
Improvements other than buildings (4,763,981) (409,714) - - (5,173,695)
Infrastructure (42,332,924) (2,458,941) - - (44,791,865)
Machinery and equipment (6,436,450) (915,121) 256,004 - (7,095,567)
Total accumulated depreciation (79,574,492) (5,574,654) 264,145 - (84,885,001)
Total capital assets being
depreciated, net 97,158,540 (4,083,010) (271,739) 465,444 93,269,235
Total governmental fund capital
assets, net 147,797,080 4,657,178 (271,739) - 152,182,519
Internal service funds
Capital assets being depreciated
Machinery and equipment 13,602,771 1,141,662 (327,678) - 14,416,755
Total internal service assets
being depreciated 13,602,771 1,141,662 (327,678) - 14,416,755
Less accumulated depreciation
Machinery and equipment (7,647,762) (1,387,290) 327,678 - (8,707,374)
Total internal service funds
capital assets, net 5,955,009 (245,628) - - 5,709,381
Total governmental activities
capital assets, net 153,752,089$ 4,411,550$ (271,739)$ -$ 157,891,900$
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
56
NOTE 3. CAPITAL ASSETS – CONTINUED
Balance Balance
Beginning Adjustment/End of
of Year Increase Decrease Transfer Year
Business-type activities
Capital assets not being depreciated
Land 3,618,545$ -$ -$ -$ 3,618,545$
Construction in progress 953,413 5,336,158 - (1,082,404) 5,207,167
Total capital assets
not being depreciated 4,571,958 5,336,158 - (1,082,404) 8,825,712
Capital assets being depreciated
Buildings 4,207,035 - - - 4,207,035
Equipment 3,970,602 130,289 (155,413) 14,436 3,959,914
Improvements 21,171,897 102,446 - 363,417 21,637,760
Utility system 113,518,732 1,782,925 - 704,551 116,006,208
Total capital assets being
depreciated 142,868,266 2,015,660 (155,413) 1,082,404 145,810,917
Less accumulated depreciation
Buildings (2,531,389) (124,215) - - (2,655,604)
Equipment (1,839,974) (291,328) 155,413 - (1,975,889)
Improvements (11,138,603) (608,303) - - (11,746,906)
Utility system (56,672,799) (2,740,812) - - (59,413,611)
Total accumulated depreciation (72,182,765) (3,764,658) 155,413 - (75,792,010)
Total capital assets being
depreciated, net 70,685,501 (1,748,998) - 1,082,404 70,018,907
Total business-type activities
capital assets, net 75,257,459$ 3,587,160$ -$ -$ 78,844,619$
Depreciation expense was charged as a direct expense to programs of the primary government as
follows:
Governmental activities
Culture and recreation 785,961$
Development 24,003
General administrative 3,054,572
Highways and streets 2,540,116
Public safety 557,292
Total depreciation expense - governmental activities 6,961,944$
Business-type activities
Water and wastewater 2,110,195$
Drainage utility 779,768
Golf course 398,547
Other recreation enterprises 476,148
Total depreciation expense - business-type activities 3,764,658$
Outstanding commitments at September 30, 2019, under authorized construction contracts, were
$15,675,253. These outstanding commitments are to be financed by available deposit and investment
balances, which include proceeds from previous bond issuances.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
57
NOTE 4. LONG-TERM DEBT
The following is a summary of long-term debt activity of the City for the year ended September 30,
2019:
Balance Balance Due
Beginning End within
of Year Increases Decreases of Year One Year
Governmental activities
General obligation bonds 11,460,000$ -$ (2,655,000)$ 8,805,000$ 2,765,000$
Certificates of obligation 35,660,000 11,785,000 (1,245,000) 46,200,000 1,605,000
Sales tax revenue bonds 40,000 1,635,000 (110,000) 1,565,000 60,000
Tax notes 735,000 - (735,000) - -
Capital lease 83,848 - (83,848) - -
Premium on debt 1,315,625 869,936 (206,536) 1,979,025 206,536
Discount on debt (104,123) - 12,735 (91,388) (12,735)
Net pension liability 12,280,508 14,777,575 - 27,058,083 -
Net OPEB liability 9,927,619 - (53,371) 9,874,248 -
Compensated absences 2,070,975 530,832 (524,873) 2,076,934 207,693
Total governmental activities 73,469,452 29,598,343 (5,600,893) 97,466,902 4,831,494
Business-type activities
Water and sewer revenue bonds 11,545,000 9,275,000 (915,000) 19,905,000 1,180,000
General obligation refunding bonds 4,770,000 - (475,000) 4,295,000 490,000
Premiums on debt 175,210 - (19,243) 155,967 19,241
Discounts on debt (24,380) - 1,626 (22,754) (1,625)
Net pension liability 2,280,133 2,835,745 - 5,115,878 -
Net OPEB liability 1,848,917 - (10,243) 1,838,674 -
Compensated absences 335,229 39,070 (21,239) 353,060 35,306
Total business-type activities 20,930,109 12,149,815 (1,439,099) 31,640,825 1,722,922
Total primary government 94,399,561$ 41,748,158$ (7,039,992)$ 129,107,727$ 6,554,416$
Governmental fund net pension liability and OPEB liability are typically liquidated by the
general, half-penny sales tax, crime control and prevention district, and juvenile case funds.
General Obligation Bonds
General obligation bonds and general obligation refunding bonds provide funds for the
acquisition and construction of major capital equipment, City facilities, and infrastructure assets
and the refunding of previously issued debt instruments. General obligation bonds require voter
authorization; whereas general obligation refunding bonds do not. General obligation bonds are
direct obligations of the City, payable from a continuing and direct ad valorem tax, levied within
the limits prescribed by law, on all taxable property within the City as provided in the ordinances
authorizing issuance of the bonds.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
58
NOTE 4. LONG-TERM DEBT – CONTINUED
General Obligation Bonds – Continued
The City is required to compute an interest and sinking fund tax rate sufficient to cover the
annual debt service requirements inclusive of anticipated drawdown of reserves, transfers or
revenues from self-supporting debt systems, and other miscellaneous sources.
As of September 30, 2019, general obligation bonds currently outstanding are as follows:
Interest Maturity Principal
Rate % Dated Date Outstanding
General Obligation Bonds
Taxable Refunding, Series 2010 3.85% –
4.4%
08/15/2010 08/01/2025 $3,690,000
Refunding, Series 2011 4% 01/15/2011 08/15/2021 1,680,000
Refunding, Series 2012 3% – 4% 12/01/2011 02/15/2024 2,515,000
Refunding, Series 2012A 2% – 3% 11/01/2012 02/15/2027 4,295,000
Refunding, Series 2014 3% 10/15/2014 02/15/2020 920,000
Total $13,100,000
Annual debt service requirements to maturity for general obligation bonds are as follows:
Fiscal
Year Principal Interest Principal Interest Total
2020 2,765,000$ 316,181$ 490,000$ 99,125$ 3,670,306$
2021 1,925,000 229,114 510,000 84,125 2,748,239
2022 1,105,000 152,439 520,000 71,275 1,848,714
2023 1,140,000 110,539 530,000 60,444 1,840,983
2024 1,185,000 67,099 540,000 48,738 1,840,837
2025-2027 685,000 30,140 1,705,000 66,168 2,486,308
Total 8,805,000$ 905,512$ 4,295,000$ 429,875$ 14,435,387$
Governmental Activities Business-Type Activities
The business-type activities general obligation refunding bonds outstanding were issued to
refund previously issued golf course debt. The City anticipates repayment of the debt will occur
from the golf system revenues. However, these plans are subject to change.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
59
NOTE 4. LONG-TERM DEBT – CONTINUED
Certificates of Obligation
Certificates of obligation are issued for many of the same purposes as general obligation bonds,
but certificates do not require voter authorization nor may they be used to refund existing debt.
The certificates constitute direct obligations of the City, payable from (i) the levy and collection
of a direct and continuing ad valorem tax, levied within the limits prescribed by law, on all
taxable property within the City, and (ii) a limited pledge (not to exceed $1,000) of the Net
Revenues of the City’s waterworks and sanitary sewer system.
In 2019, the Euless City Council approved the issuance of $11,785,000 of City of Euless, Texas Tax
and Waterworks and Sewer System (Limited Pledge) Revenue Certificates of Obligation, Series
2019. Proceeds will be used for construction of public works; and/or the purchase of materials,
supplies, equipment, machinery, land, and rights-of-way for authorized needs and purposes; and
professional services rendered in relation to such projects and the financing thereof.
The City currently has the following certificates of obligation outstanding as of the end of the
fiscal year:
Interest Maturity Principal
Rate % Dated Date Outstanding
Certificates of Obligation
Series 2011 4% –
4.25%
01/15/2011 08/15/2030 $2,080,000
Series 2014
Series 2015
Series 2016
Series 2018
Series 2019
3% – 5%
3% – 5%
2% – 4%
3% – 4%
3% - 5%
10/15/2014
10/27/2015
01/12/2016
03/01/2018
01/15/2019
08/15/2034
02/15/2035
02/15/2041
02/15/2038
02/15/2039
5,025,000
2,795,000
15,555,000
8,960,000
11,785,000
Total $46,200,000
Annual debt service requirements to maturity for the certificates of obligation are as follows:
Fiscal Governmental Activities
Year Principal Interest Total
2020 $ 1,605,000 $ 1,786,085 $ 3,391,085
2021 1,875,000 1,512,950 3,387,950
2022 1,930,000 1,452,075 3,382,075
2023 2,005,000 1,383,625 3,388,625
2024 2,070,000 1,304,800 3,374,800
2025-2029 11,530,000 5,393,975 16,923,975
2030-2034
2035-2039
12,760,000
10,895,000
3,230,273
1,186,537
15,990,273
12,081,537
2040-2041 1,530,000 59,150 1,589,150
Total $ 46,200,000 $17,309,470 $63,509,470
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
60
NOTE 4. LONG-TERM DEBT – CONTINUED
Revenue Bonds
Each series of revenue bonds is backed by the pledged revenue sources identified in the bond
ordinances authorizing issuance of the bonds. The purpose and primary pledged revenue sources
of each type of revenue bond are summarized as follows.
Half-penny sales tax fund issues sales tax revenue bonds (STRB) to finance library, park, and
economic development projects throughout the City. Sales tax revenue bonds are special
obligations of the Euless Development Corporation (EDC), payable solely from and secured by a
lien on and pledge of certain Pledged Revenues which includes the gross proceeds of a ½¢ sales
and use tax levied within the City for the benefit of the EDC. The EDC is reflected in the
financial statements of the City as a special revenue fund. Accordingly, the EDC’s debt is
reflected in governmental activities debt.
Water and wastewater fund issues revenue bonds (W&WW) for the construction of and
improvement to the City’s combined waterworks and sanitary sewer infrastructure or to refund
previously issued revenue bonds. Water and sewer revenue bonds and refunding bonds are
payable solely from and equally secured by a first lien on and pledge of the net revenues of the
City’s water and wastewater system.
In October 2018, the Euless Development Corporation issued $1,635,000 of Euless Development
Corporation Sales Tax Revenue Bonds, Series 2018. The bonds have interest rates ranging from
3% to 4%, with maturities through September 2038. Proceeds will be used to finance the costs of
the construction of parks and park facilities within the City and pay the costs associated with the
issuance of such bonds.
In April 2019, the City issued $9,275,000 of Waterworks and Sewer System Revenue Bonds to
the Texas Water Development Board through their Drinking Water State Revolving Fund low
interest loan program. Proceeds will be used to fund well replacement construction and the
financing thereof.
The City currently has the following revenue bonds outstanding at the end of the fiscal year:
Interest Maturity Principal
Rate % Dated Date Outstanding
Revenue Bonds
W&WW Refunding, Series 2012 2.03% 03/29/2012 07/15/2024 $ 930,000
W&WW Improvement, Series 2013 3% – 5% 06/25/2013 07/15/2033 1,215,000
W&WW Improvement, Series 2015A 0% - 1.98% 06/15/2015 07/15/2035 3,805,000
W&WW Improvement, Series 2015B
W&WW Improvement, Series 2018
W&WW Improvement, Series 2019
STRB, Series 2018
0% - 1.68%
0% - 1.49%
0% - 1.66%
3% – 4%
06/15/2015
04/12/2018
04/25/2019
10/15/2018
07/15/2035
07/15/2038
07/15/2049
09/15/2038
2,020,000
2,660,000
9,275,000
1,565,000
Total $ 21,470,000
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
61
NOTE 4. LONG-TERM DEBT – CONTINUED
Revenue Bonds – Continued
Annual debt service requirements to maturity for revenue bonds are as follows:
Fiscal
Governmental Activities Business-Type
Activities
Year Principal Interest Principal Interest Total
2020 $60,000 $58,750 $1,180,000 $306,355 $1,605,105
2021 60,000 56,950 945,000 271,034 1,332,984
2022 65,000 55,150 945,000 263,393 1,328,543
2023 65,000 53,200 960,000 254,746 1,332,946
2024 65,000 51,250 965,000 244,786 1,326,036
2025-2029 370,000 220,700 4,300,000 1,062,713 5,953,413
2030-2034 450,000 141,200 4,545,000 711,088 5,847,288
2035-2039
2040-2044
2045-2049
430,000
–
–
44,000
–
–
2,575,000
1,675,000
1,815,000
378,383
229,542
90,746
3,427,383
1,904,542
1,905,746
Total $1,565,000 $681,200 $19,905,000 $3,812,786 $25,963,986
The gross ½¢ sales tax revenues of the EDC recognized in the year ending September 30, 2019
totaled $5,356,697. The principal and interest payments on the EDC debt for the same period
totaled $160,435 which equates to approximately 3.0% of the gross ½¢ sales tax revenues.
The recognized net revenues of the water and wastewater fund totaled $3,910,186 for the year
ending September 30, 2019. Principal and interest payments on the water and sewer revenue
bonds totaled $1,106,327 which equates to approximately 28.3% of net system revenues.
In accordance with the water and sewer revenue and refunding bond ordinances, the following
reserves were established:
Reserve for revenue bond debt service – to be used for retirement of the current portion of
principal and interest payments due.
Reserve for emergency – to be used for payment of extraordinary repairs or replacements to
the system necessitated by an emergency for which no other funds are available.
Revenue bond reserve – a reserve established at the time of issuance pursuant to the revenue
bond covenants which will be used for principal and interest payments in the event of default
by the issuer.
Should the reserve for revenue bond debt service and/or the revenue bond reserve prove
deficient, the reserve for emergency shall be used for the purpose of meeting principal and/or
interest requirements of the bonds.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
62
NOTE 4. LONG-TERM DEBT – CONTINUED
Annual Requirements to Retire Debt Obligations – Continued
All funding requirements for the above reserves were met at September 30, 2019.
Investments of funds included in the bond reserve and emergency accounts are restricted to
obligations of the United States or its agencies or instrumentalities (except for mortgage pass-
through securities).
Water and sewer revenue bonds authorized and unissued as of September 30, 2019, amounted to
$1,200,000. The water and sewer bonds were authorized in 1970, and currently the City Council
has no intent to issue these bonds.
NOTE 5. COMMITMENTS AND CONTINGENT LIABILITIES
The City entered into a contract dated January 21, 1972, with Trinity River Authority (TRA)
whereby TRA agreed to provide treated water to the City. This contract was for an original term of
thirty-five (35) years and continues in effect until all bonds, or any bonds issued to refund same,
have been paid in full. Additionally, on October 10, 1973, the City entered into a contract with TRA
to provide wastewater treatment services to the City. The contract remains in force and effect for a
period of fifty (50) years and thereafter until any bonds, or any bonds issued to refund same, have
been paid in full. Payments by the City are based on metered usage at rates designed to charge the
City a prorata share of TRA's annual operating and maintenance expenses and principal and interest
requirements on bonds issued by TRA. Payments under these contracts approximated $10,827,111
and are included as operating expenses of the water and wastewater fund.
The City entered into a 20-year contract dated February 2, 2010, with the City of Fort Worth (Fort
Worth) whereby Fort Worth agreed to provide reclaimed water service to the City. Payments by the
City are based on metered volume. Payments under this contract were $243,759 in the year ended
September 30, 2019 and are included as operating expenses of the water and wastewater fund.
The City is involved in a number of lawsuits arising in the ordinary course of business. In the
opinion of the City's legal counsel and management, any liability resulting from such litigation
would not be material in relation to the City's financial position.
NOTE 6. SERVICE CENTER
The water and wastewater enterprise fund historically bears the major portion of the operating costs
of the City's service center, which provides services to all City departments.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
63
NOTE 7. INTERFUND TRANSFERS
All interfund transfers between the various funds are approved supplements to the operations of
those funds.
General Debt Service Street CIP
Non-major
Governmental
Subtotal
Governmental
Internal
Service
Transfers out
General -$ -$ 1,050,000$ 206,406$ 1,256,406$ 242,000$
Car rental tax 1,640,085 - - 3,514,900 5,154,985 376,673
Water and wastewater 1,289,265 - - - 1,289,265 242,000
Drainage utility 41,541 - - - 41,541 -
Nonmajor governmental - 2,392,997 - 880,246 3,273,243 -
Internal service - 161 - 25,000 25,161 -
Total transfers in 2,970,891$ 2,393,158$ 1,050,000$ 4,626,552$ 11,040,601$ 860,673$
Water and Drainage Golf Other Recreation Subtotal Total
Wastewater Utility Course Enterprise Enterprise Transfers Out
Transfers out
General -$ -$ 13,207$ -$ 13,207$ 1,511,613$
Car rental tax - - - - - 5,531,658
Water and wastewater - - - - - 1,531,265
Drainage utility - - - - - 41,541
Nonmajor governmental - - 438,102 58,835 496,937 3,770,180
Internal service - - - - - 25,161
Total transfers in -$ -$ 451,309$ 58,835$ 510,144$ 12,411,418$
Transfers in
Transfers in
Major Enterprise
Transfers are primarily used to move funds from:
The general fund to the street CIP fund and non-major governmental funds to satisfy grant
matching requirements and to fund approved capital projects and to the golf course fund for
sales tax rebates.
The car rental tax fund, the water and wastewater fund, and the drainage utility fund to the
general fund for general and administrative charges.
The car rental tax fund to the non-major governmental funds to provide funding for approved
capital projects.
The non-major governmental funds to non-major governmental funds to provide funding for
approved projects.
The non-major governmental funds to debt service funds for debt payments on previously
issued debt.
The general fund and water and wastewater fund to the internal service funds for workers’
compensation and general liability insurance claims.
The car rental fund to the internal service funds for equipment purchases.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
64
NOTE 7. INTERFUND TRANSFERS – CONTINUED
The non-major governmental funds to the golf course fund to cover a portion of the operating
and debt costs associated with the conference center.
The non-major governmental funds to the other recreation enterprises fund to provide
funding for approved projects.
Internal service funds to general debt service for a portion of the debt payment and to the
non-major governmental funds to provide project funding.
NOTE 8. RISK MANAGEMENT
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of
assets; errors and omissions; injuries to employees; and natural disasters. The City participates in the
Texas Municipal League Joint Self-Insurance Fund (TMLIF) to provide both general liability and
property insurance.
The City, along with other participating entities, contributes annual amounts determined by TMLIF
management. As claims arise they are submitted to and paid by TMLIF. The City is not liable for
payments beyond their annual contributions to TMLIF and related deductibles.
In fiscal year 2006, the City contracted with the Texas Municipal League Intergovernmental Risk
Pool to provide workers’ compensation insurance and effectively discontinued being self-insured for
workers’ compensation claims. This policy has no deductibles, includes all claims handling, and has
a fixed premium.
In fiscal years prior to 2006, the City was self-insured for workers' compensation claims.
Contributions were made to a separate risk management fund by other funds and were available to
pay claims, claim reserves, and administrative costs of the program. The City remains liable under
its self-insurance program for any claims occurring prior to October 1, 2005.
The City provides employee health insurance coverage on a self-insured basis. Premiums are paid
into a separate insurance fund by other funds, by the City's employees, and by retirees. The
premiums are used to fund claims, administrative costs of the program, and claim reserves. An
excess coverage insurance policy covers individual claims in excess of $125,000 and aggregate
claims in excess of $6,661,017. During fiscal year 2019, the City and the City's employees
contributed approximately $4,525,714 and $1,431,817 respectively, for medical coverage.
The City's contributions are accounted for as interfund services provided and used. Claims liabilities
are based on estimates of the ultimate cost of claims (including future claim adjustment expenses)
that have been reported but not settled, and of claims that have been incurred but not reported, and
are accounted for in the Insurance Internal Service Fund.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
65
NOTE 8. RISK MANAGEMENT – CONTINUED
Changes in the balances of health and dental claims liabilities for the years ended September 30,
2019 and 2018 are as follows:
2019 2018
Unpaid claims, beginning of year 608,000$ 885,000$
Incurred claims 2,728,588 2,946,653
Paid claims (2,903,588) (3,223,653)
Unpaid claims, end of year 433,000$ 608,000$
Settlement amounts have not exceeded stop loss insurance coverage for the year ended
September 30, 2019 or any of the three preceding years ended September 30.
NOTE 9. DEFINED BENEFIT PENSION PLAN
Plan Description
The City participates as one of 887 plans in the nontraditional, joint contributory, hybrid defined
benefit pension plan administered by the Texas Municipal Retirement System (TMRS). TMRS is
an agency created by the State of Texas and administered in accordance with the TMRS Act,
Subtitle G, Title 8, Texas Government Code (the TMRS Act) as an agent multiple -employer
retirement system for municipal employees in the State of Texas. The TMRS Act places the
general administration and management of the System with a six-member Board of Trustees.
Although the Governor, with the advice and consent of the Senate, appoints the Board, TMRS is
not fiscally dependent on the State of Texas. TMRS’s defined benefit pension plan is a tax -
qualified plan under Section 401 (a) of the Internal Revenue Code. TMRS issues a publicly
available comprehensive annual financial report (CAFR) that can be obtained at www.tmrs.com.
All eligible employees of the City are required to participate in TMRS.
Benefits Provided
TMRS provides retirement, disability and death benefits. Benefit provisions are adopted by the
governing body of the City, within the options available in the state statutes governing TMRS.
At retirement, the benefit is calculated as if the sum of the employee’s contributions, with
interest, and the city-financed monetary credits with interest were used to purchase an annuity.
Members may choose to receive their retirement benefit in one of seven payment options.
Members may also choose to receive a portion of their ben efit as a Partial Lump Sum
Distribution in an amount equal to 12, 24, or 36 monthly payments, which cannot exceed 75% of
the member’s deposits and interest.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
66
NOTE 9. DEFINED BENEFIT PENSION PLAN – CONTINUED
Benefits Provided – Continued
Plan provisions for the City are as follows:
Employee deposit rate 7%
Matching ratio (City to employee) 2 to 1
A member is vested after 5 years
Service retirement eligibility 20 years at any age, 5 years at 60 and above
Updated service credit 100% Repeating, Transfers
Annuity increase (to retirees) 70% of CPI
Employees Covered By Benefit Terms
At the December 31, 2018 valuation and measurement date, the following employees were
covered by the benefit terms:
Inactive employees or beneficiaries currently receiving benefits 247
Inactive employees entitled to, but not yet receiving benefits 170
Active employees 382
Total 799
Contributions
The contribution rates for employees in TMRS are either 5%, 6%, or 7% of employee gross
earnings, and the city matching percentages are either 100%, 150%, or 200%, both as adopte d by
the governing body of the City. Under the state law governing TMRS, the contribution rate for
each city is determined annually by the actuary, using the Entry Age Normal (EAN) actuarial
cost method. The actuarially determined rate is the estimated amount necessary to finance the
cost of benefits earned by employees during the year, with an additional amount to finance any
unfunded accrued liability.
Employees of the City were required to contribute 7% of their annual gross earnings during the
year ended September 30, 2019. The contribution rates for the City were 17.80% and 17.51% in
calendar years 2018 and 2019, respectively. The City’s contributions to TMRS for the year
ended September 30, 2019 were $5,174,020 and were equal to the required contributions.
Net Pension Liability
The City’s Net Pension Liability (NPL) was measured as of December 31, 2018, and the Total
Pension Liability (TPL) used to calculate the Net Pension Liability was determined by an
actuarial valuation as of that date.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
67
NOTE 9. DEFINED BENEFIT PENSION PLAN – CONTINUED
Actuarial Assumptions
The TPL in the December 31, 2018 actuarial valuation was determined using the following
actuarial assumptions:
Inflation 2.5% per year
Overall payroll growth 3.0% per year
Investment rate of return 6.75%, net of pension plan investment expense,
including inflation
Salary increases were based on a service-related table. Mortality rates for active members,
retirees, and beneficiaries were based on the gender-distinct RP2000 Combined Healthy
Mortality Table with Blue Collar Adjustments, with male rates multiplied by 109% and female
rates multiplied by 103%.
The rates are projected on a fully generational basis by scale BB to account for future mortality
improvements. For disabled annuitants, the gender-distinct RP2000 Combined Healthy Mortality
Tables with Blue Collar Adjustments are used with male rates multiplied by 109% and female
rates multiplied by 103% with a 3-year set-forward for both males and females. In addition, a
3% minimum mortality rate is applied to reflect the impairment for younger members who
become disabled. The rates are projected on a fully generational basis by scale BB to account for
future mortality improvements subject to the 3% floor.
The actuarial assumptions were developed primarily from the actuarial investigation of the
experience of TMRS over the four year period from December 31, 2010 to December 31, 2014.
They were adopted in 2015 and first used in the December 31, 2015 actuarial valuation. The
post-retirement mortality assumption for healthy annuitants and Annuity Purchase Rate (APR s)
are based on the Mortality Experience Investigation Study covering 2009 through 2011 and
dated December 31, 2013. In conjunction with these changes first used in the December 31, 2013
valuation, the System adopted the Entry Age Normal actuarial cost method and a one-time
change to the amortization policy. Plan assets are managed on a total return basis with an
emphasis on both capital appreciation as well as the production of income, in order to satisfy the
short-term and long-term funding needs of TMRS.
The long-term expected rate of return on pension plan investments was determined using a
building-block method in which best estimate ranges of expected future real rates of return
(expected returns, net of pension plan investment expense and inflation) are developed for each
major asset class. These ranges are combined to produce the long-term expected rate of return by
weighting the expected future real rates of return by the target asset allocation percentage and by
adding expected inflation. In determining their best estimate of a recommended investment
return assumption under the various alternative asset allocation portfolios, GRS focused on the
area between (1) arithmetic mean (aggressive) without an adjustment for time (conservative) and
(2) the geometric mean (conservative) with an adjustment for time (aggressive).
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
68
NOTE 9. DEFINED BENEFIT PENSION PLAN – CONTINUED
Actuarial Assumptions – Continued
The target allocation and best estimates of real rates of return for each major asset class in fiscal
year 2019 are summarized in the following table:
Asset Class
Target
Allocation
Long-Term Expected Real
Rate of Return (Arithmetic)
Domestic Equity 17.5%4.30%
International Equity 17.5%6.10%
Core Fixed Income 10.0%1.00%
Non-Core Fixed Income 20.0%3.39%
Real Return 10.0%3.78%
Real Estate 10.0%4.44%
Absolute Return 10.0%3.56%
Private Equity 5.0%7.75%
Total 100.0%
Discount Rate
The discount rate used to measure the Total Pension Liability was 6.75%. The projection of cash
flows used to determine the discount rate assumed that employee and employer contributions
will be made at the rates specified in statute. Based on that assumption, the pension plan’s
Fiduciary Net Position was projected to be available to make all projected future benefit
payments of current active and inactive employees. Therefore, the long-term expected rate of
return on pension plan investments was applied to all periods of projected benefit payments to
determine the Total Pension Liability.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
69
NOTE 9. DEFINED BENEFIT PENSION PLAN – CONTINUED
Changes in the Net Pension Liability
TPL
(a)
Plan Fiduciary
Net Position
(b)
NPL
(a) - (b)
Balance at 12/31/2017 206,651,269$ 192,090,628$ 14,560,641$
Changes for the year:
Service cost 5,253,722 - 5,253,722
Interest 13,864,487 - 13,864,487
Change of benefit terms - - -
Difference between expected
and actual experience (206,128) - (206,128)
Changes of assumptions - - -
Contributions - employer - 5,146,736 (5,146,736)
Contributions - employee - 2,023,998 (2,023,998)
Net investment income - (5,754,957) 5,754,957
Benefit payments, including
refunds of employee contributions (7,756,635) (7,756,635) -
Administrative expense - (111,206) 111,206
Other changes - (5,810) 5,810
Net changes 11,155,446 (6,457,874) 17,613,320
Balance at 12/31/2018 217,806,715$ 185,632,754$ 32,173,961$
Increase (Decrease)
Sensitivity of the Net Pension Liability to Changes in the Discount Rate
The following presents the net pension liability of the City, calculated using the discount rate of
6.75%, as well as what the City’s net pension liability would be if it were calculated using a
discount rate that is 1-percentage-point lower (5.75%) or 1-percentage-point higher (7.75%) than
the current rate:
1% Decrease
in
Discount Rate
(5.75%)
Discount Rate
(6.75%)
1% Increase in
Discount Rate
(7.75%)
City’s net pension liability 62,929,686$ 32,173,961$ 6,913,692$
Pension Plan Fiduciary Net Position
Detailed information about the pension plan’s Fiduciary Net Position is available in a separately-
issued TMRS financial report. That report may be obtained on the Internet at www.tmrs.com.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
70
NOTE 9. DEFINED BENEFIT PENSION PLAN – CONTINUED
Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources
Related to Pensions
For the year ended September 30, 2019, the City recognized pension expense of $7,716,688.
At September 30, 2019, the City reported deferred outflows of resources and deferred inflows of
resources related to pensions from the following sources:
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected
and actual experience -$ 431,821$
Changes in actuarial assumptions - 146,976
Difference between projected and
actual investment earnings 9,934,982 -
Contributions subsequent to the
measurement date 3,605,248 -
Total 13,540,230$ 578,797$
$3,605,248 reported as deferred outflows of resources related to the pension resulting from
contributions subsequent to the measurement date will be recognized as a reduction of the net
pension liability for the year ended September 30, 2020. Other amounts reported as deferred
outflows and inflows of resources related to pensions will be recognized in pension expense as
follows:
Measurement Net Deferred
Year Outflows/(Inflows)
December 31,of Resources
2019 3,156,296$
2020 1,190,955
2021 1,302,675
2022 3,711,091
2023 (4,832)
Total 9,356,185$
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
71
NOTE 10. OTHER POSTEMPLOYMENT BENEFITS
Postemployment Healthcare Plan
Plan Description
The City adopted the City of Euless Post-Employment Benefits Trust (OPEB Trust) by passage
of Resolution No. 09-1319 on September 8, 2009 which authorized participation in the PARS
Public Agencies Post-Retirement Health Care Plan Trust, including the City of Euless Public
Agencies Post-Retirement Health Care Plan (the Plan), as part of the City’s Retirement Program.
Article III of the Public Agencies Post-Retirement Health Care Plan Master Plan Document as
adopted provides for the determination of eligibility under the plan to each participating
Employer to the extent provided in the Employer’s applicable policies.
The City’s policies with regard to post-employment healthcare coverage are governed by the
City of Euless Medical and Dental Plan, the City’s group health insurance plan, the benefits of
which are established by management.
Benefits provided. The City provides post-employment medical, dental, life, and vision benefits
under the Plan to eligible retirees and dependents qualifying as one of the eligible classes of
dependents as described in the Plan. To be eligible for coverage under the Plan, an employee
must retire with the City of Euless and be eligible for retirement through TMRS. TMRS
retirement eligibility requirements are described in detail in Note 9. Additionally, written
application to enroll himself/herself and all eligible dependents (for which coverage is elected) in
the Plan must be made by the employee prior to or on the retirement date.
The Plan provides lifetime benefits or until Medicare eligibility is attained. Regardless of
Medicare enrollment status, the Plan will base payment of benefits as t hough Medicare were
responsible for primary payment of benefits insomuch as allowed by Federal law.
The Plan is a single-employer defined benefit healthcare plan administered by the City Manager,
his/her successor, or his/her designee. Separate financial statements for the Plan are not issued,
but rather are included in the financial statements of the City which are available on-line at
https://www.eulesstx.gov/departments/finance/cafr.
The OPEB Trust is an agent multiple-employer trust arrangement established to provide
economies of scale and efficiency of administration to public agencies. The OPEB Trust is
established as a tax-exempt trust within the meaning of Section 115 of the Internal Revenue
Code and is intended to hold the assets used to fund the City’s post-employment benefits offered
by the City to its employees as specified in the City’s policies.
The OPEB Trust is administered by Public Agency Retirement Services pursuant to the Trust
Agreement adopted on September 8, 2009 by the City Council with passage of Resolution No.
09-1319. Upon adoption of the Trust Agreement, a separate Agency Account was established
under the OPEB Trust for the City, and all assets of the Trust attributable to the City are held in
the City’s Agency Account. The assets of the Trust are available only to pay post -employment
healthcare benefits of eligible employees of the City and their dependents and other associated
administrative costs.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
72
NOTE 10. OTHER POSTEMPLOYMENT BENEFITS – CONTINUED
Funding Policy
A Participant in the OPEB Trust is required from time-to-time to contribute to its Agency
Account an amount determined by such Participant at its sole discretion. Such amount may, but
need not, equal such Participant’s actuarially determined contribution (ADC) as determined in
accordance with GASB 74. However, it is currently the intent of the Plan Administrator to
annually fund an amount equal to, or in excess of, the ADC. This intent is sub ject to change and
is subject to annual appropriation.
Contribution requirements of Plan members and the City are determined by the Plan
Administrator and may be amended by same from time to time. Plan members contribute:
Medical Plan A Medical Plan B Dental Vision
Retiree Only 908.73$ 739.68$ 33.10$ 8.26$
Retiree plus Children 1,726.59 1,405.39 62.89 13.50
Retiree plus Spouse 2,090.08 1,701.26 76.13 16.04
Retiree plus Family 2,635.32 2,145.07 96.00 22.68
Monthly Contribution
Retired employees meeting all eligibility requirements as set forth in the Plan that were hired
prior to October 1, 2006 and are either:
a) Retired and enrolled in the Plan on or prior to September 30, 2007; or
b) Retired and not enrolled in the Plan on or prior to September 30, 2007 and meet
guidelines for reinstatement to the Plan; or
c) Employees who were not retired as of September 30, 2007 that retire with at least ten
years of service to the City of Euless and have a combined age and years of service equal
to at least 70
will qualify for a service discount on their total premium, subject to annual appropriation, as set
forth in the following table.
Retired employees meeting all eligibility requirements as set forth in the Plan that were hired
after October 1, 2006 and before October 1, 2014 retiring with a minimum of 20 years of service
with a combined age and years of service to the City of Euless equal to at least 80 qualify for a
service discount on their total premium, subject to annual appropriation, as set forth in the
following:
Service Retiree Retiree+Retiree Retiree+Retiree Retiree+
10 to 14 years 15%30%N/A N/A N/A N/A
15 to 19 years 25%40%N/A N/A N/A N/A
20 to 24 years 35%50%35%50%N/A N/A
25 to 29 years 50%65%50%65%N/A N/A
30+ years 60%75%60%75%N/A N/A
Hired Pre-10/2006 Hired Post-10/2006 Hired Post-10/2014
Discounts on Premiums
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
73
NOTE 10. OTHER POSTEMPLOYMENT BENEFITS – CONTINUED
Funding Policy – Continued
Retirees are permitted to participate with active employees in the healthcare plan but retirees
must pay all premiums (less applicable discounts) assigned to them. The City will continue to
apply the applicable discount to surviving spouse/dependents based upon a deceased employee’s
years of service. Employees hired on or after October 1, 2014 will not be eligible for premium
discounts regardless of years of service.
Per the requirements of GASB 74 and GASB 75, the following data is presented.
Plan Membership
At the September 30, 2018 actuarial valuation and measurement date, plan membership consisted
of the following:
Inactive plan members or beneficiaries currently receiving benefit payments 76
Inactive plan members entitled to, but not yet receiving benefit payments 25
Active plan members 761
862
Investments
Investment policy. The City’s policy in regard to the allocation of invested assets is established
and may be amended by the City Manager. The City Council appointed the City Manager or her
successor or her designee as the City’s Plan Administrator. The City Manager selected the
balanced, moderately aggressive actively-managed investment option (HighMark PLUS) to
provide growth of principal and income. While dividend and interest income are an important
component of the objective’s total return, it is expected that capital appreciation will comprise a
larger portion of the total return. The portfolio will be allocated between equity and fixed
income investments.
Asset Class
Strategic
Range
Target
Allocation
9/30/2019
Allocation
Equity 60-85%75%58%
Fixed income 10-30%20%38%
Cash 0-20%5%4%
100%100%
Rate of return. For the year ended September 30, 2019, the annual money-weighted rate of
return on investments, net of investment expense, was 4.07%. The money-weighted rate of
return expresses investment performance, net of investment expense, adjusted for the changing
amounts actually invested.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
74
NOTE 10. OTHER POSTEMPLOYMENT BENEFITS – CONTINUED
Investments – Continued
Concentrations. The following investments comprised 5% or more of the OPEB plan’s fiduciary
net position as of September 30, 2019:
% of
Asset Class Investment Vehicle Portfolio
Equity Vanguard Growth & Income Adm 12.86%
Equity Dodge & Cox Stock Fund 6.87%
Fixed Income Vanguard Short-Term Corp Adm Fund 6.07%
Fixed Income PGIM Total Return Bond R6 10.82%
Fixed Income PIMCO Total Rturn Instl Fund 10.82%
Fixed Income DoubleLine Core Fixed Income I 10.79%
Net OPEB Liability of the City
The components of the net OPEB liability of the City at September 30 were as follows:
2019 2018
Total OPEB liability 19,126,287$ 18,214,654$
Plan fiduciary net position (7,413,365) (6,438,118)
City's net OPEB liability 11,712,922$ 11,776,536$
Plan fiduciary net assets as a percent
of the total OPEB liability 38.76%35.35%
Actuarial Methods and Assumptions
Projections of benefits for financial reporting purposes are based on the substantive plan (the
plan as understood by the employer and the plan members) and include the types of benefits
provided at the time of each valuation and the historical pattern of sharing of benefit costs
between the employer and plan members at that point. The actuarial methods and assumptions
used include techniques that are designed to reduce the effects of short-term volatility in actuarial
accrued liabilities and the actuarial value of plan assets, consistent with the long-term perspective
of the calculations.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
75
NOTE 10. OTHER POSTEMPLOYMENT BENEFITS – CONTINUED
Actuarial Methods and Assumptions – Continued
An actuarial valuation was performed as of September 30, 2018 using the entry age normal
actuarial cost method. The liability was then projected forward to the measurement date of
September 30, 2019. The actuarial assumptions include:
Inflation 2.5% per annum
Salary increases 3.00%
Investment rate of return 7.50%
Healthcare cost trend rates 7.3% with annual increases/decreases to
an ultimate rate of 4.20% in 2044
Dental cost trend rates 3.00%
Mortality rates were based on the Adjusted RPH-2014 Generational with MP-2018 projection.
The plan has not had a formal actuarial experience study performed.
The expected return of each asset class is determined through a combination of historical rates of
return, valuation projections, and economic expectations. Expected rates of return are developed
and annually reviewed by HighMark’s Asset Allocation Committee. The long-term expected
rate of return on OPEB plan investments is then calculated by weighting the returns for each
asset class according to the exposure as determined by the current strategic allocation. The
anticipated long-term rate of return is 7.21% with an expected standard deviation of 11.85%.
Anticipated long-term returns by asset class are not available.
Discount rate. The discount rate used to measure the total OPEB liability was 7.5%. The
projection of cash flows used to determine the discount rate assumed the City contributions will
be made at rates at least equal to the actuarially determined contribution rates. Bas ed on those
assumptions, the OPEB Plan’s fiduciary net position was projected to be available to make all
projected future benefit payments of current plan members. Therefore, the long-term expected
rate of return on OPEB plan investments was applied to all periods of projected benefit payments
to determine the total OPEB liability.
Sensitivity of the OPEB liability to changes in the discount rate. The following presents the net
OPEB liability of the City as well as what the City’s net OPEB liability wou ld be if it were
calculated using a discount rate that is one percentage point lower (6.5%) or one percentage point
higher (8.5%) than the current discount rate:
1% Decrease
(6.5%)
Discount Rate
(7.5%)
1% Increase
(8.5%)
Net OPEB liability 15,346,916$ 11,712,922$ 8,843,979$
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
76
NOTE 10. OTHER POSTEMPLOYMENT BENEFITS – CONTINUED
Actuarial Methods and Assumptions – Continued
Sensitivity of the OPEB liability to changes in the healthcare cost trend rates. The following
presents the net OPEB liability of the City as well as what the City’s net OPEB liability would be
if it were calculated using healthcare cost trend rates that are one percentage point lower or one
percentage point higher than the current healthcare cost trend rates:
1% Decrease
Current Trend
Rates 1% Increase
Net OPEB liability 8,790,831$ 11,712,922$ 14,843,022$
Net OPEB Liability
Total OPEB
Liability
(a)
Plan Fiduciary
Net Position
(b)
Net OPEB
Liability
(a) - (b)
Balance at 9/30/2018 18,214,654$ 6,438,118$ 11,776,536$
Changes for the year:
Service cost 435,930 - 435,930
Interest 1,360,548 - 1,360,548
Change of benefit terms - - -
Difference between expected
and actual experience - - -
Changes of assumptions - - -
Difference in expected and
actual net investment income - (226,279) 226,279
Contributions - employer - 1,583,715 (1,583,715)
Contributions - other 270,205 270,205 -
Net investment income - 502,656 (502,656)
Benefit payments, including
refunds of employee contributions (1,019,931) (1,019,931) -
Administrative expense (135,119) (135,119) -
Net changes 911,633 975,247 (63,614)
Balance at 9/30/2019 19,126,287$ 7,413,365$ 11,712,922$
Increase (Decrease)
Assumption Changes. Since the prior valuation, the mortality improvement scale was updated
from MP-2017 to the MP-2018 table. Also, the per capita claims costs and trend were updated to
reflect recent experience.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
77
NOTE 10. OTHER POSTEMPLOYMENT BENEFITS – CONTINUED
OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources
Related to OPEB
For the year ended September 30, 2019, the City recognized OPEB expense of $1,479,142.
At September 30, 2019, the City reported deferred outflows of resources and deferred inflows of
resources related to OPEB from the following sources:
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected
and actual experience 875,992$ -$
Changes in actuarial assumptions - 478,885
Difference between projected and
actual investment earnings 204,109 -
Total 1,080,101$ 478,885$
Amounts reported as deferred outflows and inflows of resources related to OPEB will be
recognized in OPEB expense as follows:
Fiscal Year Net Deferred
Ending Outflows/(Inflows)
September 30,of Resources
2020 185,320$
2021 185,320
2022 185,320
2023 45,256
Total 601,216$
NOTE 11. EXCESS OF EXPENDITURES OVER APPROPRIATIONS
As of September 30, 2019, the grant special revenue fund had an excess of expenditures over
appropriations of $14,335.
CITY OF EULESS, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
78
NOTE 12. SUBSEQUENT EVENT
On December 12, 2019, the Euless Development Corporation, a blended component unit of the City,
issued $4,120,000 of Euless Development Corporation Sales Tax Revenue Bonds, Series 2019.
Proceeds will be used for construction of parks and park facilities, specifically Texas Star Sports
Complex Phase VII Construction, as approved in the Capital Improvements Program Budget and the
financing thereof.
On January 14, 2020, the City Council approved the issuance of $7,115,000 of Tax and Waterworks
and Sewer System (Limited Pledge) Revenue Certificates of Obligation, series 2020 for the purpose
of paying contractual obligations to be incurred for (i) the construction of public work s, to wit;
acquiring, designing, constructing, improving, expanding, and equipping one or more fire stations
(including the demolition of existing fire Station #1); and (ii) professional services rendered in
relation to such projects and the financing thereof.
79
REQUIRED SUPPLEMENTARY INFORMATION
CITY OF EULESS, TEXAS
SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS
FOR THE MEASUREMENT YEAR ENDED DECEMBER 31
80
2018*2017*2016*2015*2014*
Total pension liability
Service cost 5,253,722$ 5,149,378$ 4,868,631$ 4,539,237$ 4,331,759$
Interest (on the total pension liability)13,864,487 13,129,452 12,462,429 12,302,430 11,698,243
Difference in expected and actual experience (206,128) 169,296 (361,966) (579,992) (752,184)
Change in assumptions - - - (595,757) -
Benefit payments, including refunds of employee contributions (7,756,635) (7,465,146) (6,990,135) (6,911,946) (6,588,671)
Net change in total pension liability 11,155,446 10,982,980 9,978,959 8,753,972 8,689,147
Total pension liability, beginning of year 206,651,269 195,668,289 185,689,330 176,935,358 168,246,211
Total pension liability, ending of year 217,806,715$ 206,651,269$ 195,668,289$ 185,689,330$ 176,935,358$
Plan fiduciary net position
Contributions - employer 5,146,736$ 5,027,855$ 4,691,585$ 4,644,735$ 4,787,533$
Contributions - employee 2,023,998 1,981,736 1,877,709 1,801,285 1,789,251
Net investment income (5,754,957) 23,456,668 10,748,002 235,212 8,631,343
Benefit payments, including refunds of employee contributions (7,756,635) (7,465,146) (6,990,135) (6,911,946) (6,588,671)
Administrative expense (111,206) (121,542) (121,371) (143,262) (90,113)
Other (5,810) (6,160) (6,539) (7,076) (7,409)
Net change in plan fiduciary net position (6,457,874) 22,873,411 10,199,251 (381,052) 8,521,934
Plan fiduciary net position - beginning 192,090,628 169,217,217 159,017,966 159,399,018 150,877,084
Plan fiduciary net position - ending 185,632,754$ 192,090,628$ 169,217,217$ 159,017,966$ 159,399,018$
Net pension liability - ending 32,173,961$ 14,560,641$ 26,451,072$ 26,671,364$ 17,536,340$
Plan fiduciary net position as a % of total pension liability 85.23%92.95%86.48%85.64%90.09%
Covered employee payroll 28,914,263$ 28,308,838$ 26,824,411$ 25,732,638$ 25,560,729$
Net pension liability as a % of covered employee payroll 111.27%51.44%98.61%103.65%68.61%
*The schedule is intended to show information for 10 years. Additional years
will be displayed as they become available.
CITY OF EULESS, TEXAS
SCHEDULE OF CONTRIBUTIONS – PENSION
FOR THE YEAR ENDED SEPTEMBER 30
81
2019*2018*2017*2016*2015*
Actuarially determined contributions 5,174,020$ 5,094,779$ 4,971,811$ 4,670,520$ 4,602,538$
Actual contributions (5,174,020) (5,094,779) (4,971,811) (4,670,520) (4,602,538)
Contributions deficiency (excess)-$ -$ -$ -$ -$
City covered employee payroll 29,411,252$ 28,640,420$ 28,113,691$ 26,464,297$ 25,453,407$
Ratio of actual contributions to covered payroll amount 17.80% and 17.51%17.76% and 17.80%17.49% and 17.76%18.05% and 17.49% 18.73% and 18.05%
*The schedule is intended to show information for 10 years. Additional years
will be displayed as they become available.
Notes to Schedule
Valuation Date
Methods and Assumptions Used to Determine Contribution Rates:
Actuarial Cost Method Entry Age Normal
Amortization Method Level Percentage of Payroll, Closed
Remaining Amortization Period 25 years
Asset Valuation Method 10 year smoothed market; 15% soft corridor
Inflation 2.5%
Salary Increases 3.5% to 10.5% including inflation
Investment Rate of Return 6.75%
Retirement Age
Mortality
Actuarial determined contribution rates are calculated as of December 31st each year
and become effective in January, 13 months later
Experience-based table of rates that are specific to the City's plan of benefits.Last
updated for the 2015 valuation pursuant to an experience study of the period 2010 -
RP2000 Combined Mortality Table with Blue Collar Adjustment with male rates
multiplied by 109% and female rates multiplied by 103% and projected on a fully
generational basis with scale BB.
CITY OF EULESS, TEXAS
SCHEDULE OF CHANGES IN NET OPEB LIABILITY AND RELATED RATIOS
FOR THE YEAR ENDED SEPTEMBER 30
82
2019*2018*2017*
Total OPEB liability
Service cost 435,930$ 447,155$ 75,083$
Interest on total OPEB liability 1,360,548 1,271,483 825,331
Effect of changes of benefit terms - - -
Effect of difference between expected
and actual experience - 1,459,988 432,425
Contributions - other 270,205 - -
Effect of changes of assumptions - (798,143) 5,480,748
Administrative expense (135,119) - -
Benefit payments (1,019,931) (1,230,281) (1,332,839)
Net change in OPEB liability 911,633 1,150,202 5,480,748
Beginning balance 18,214,654 17,064,452 11,583,704
Ending balance 19,126,287$ 18,214,654$ 17,064,452$
Plan fiduciary net position
Contributions - employer 1,583,715$ 1,754,093$ 1,832,839$
Contributions - other 270,205 320,471 -
Net investment income 502,656 381,824 559,716
Difference in expected
and actual net investment
income (226,279) - -
Benefit payments (1,019,931) (1,230,281) (1,332,839)
Administrative expense (135,119) (147,597) (13,525)
Net change in plan fiduciary
net position 975,247 1,078,510 1,046,191
Beginning balance 6,438,118 5,359,608 4,313,417
Ending balance 7,413,365$ 6,438,118$ 5,359,608$
City's net OPEB liability ending 11,712,922$ 11,776,536$ 11,704,844$
Plan fiduciary net position as a %
of the total OPEB liability 39%35%31%
Covered employee payroll 29,411,252$ 28,640,420$ 25,944,080$
City's net OPEB liability as a %
of covered employee payroll 40%41%45%
* This schedule is presented to illustrate the requirement to show ten years of information. However, until a full
ten-year trend is available, the schedule will present the information that is available.
CITY OF EULESS, TEXAS
SCHEDULE OF CONTRIBUTIONS – OPEB TRUST
FOR THE YEAR ENDED SEPTEMBER 30
83
Schedule of City OPEB Contributions 2019*2018*2017*
Actuarially determined contribution 1,486,177$ 1,492,738$ 1,226,144$
Contributed in relation to the actuarially
determined contribution 1,583,715 1,754,093 1,832,839
Contribution deficiency (excess)(97,538)$ (261,355)$ (606,695)$
Covered employee payroll 29,411,252$ 28,640,420$ 25,944,080$
Contributions as a percentage of
covered employee payroll 5.4%6.1%7.1%
* This schedule is presented to illustrate the requirement to show ten years of information. However, until a
full ten-year trend is available, the schedule will present the information that is available.
Notes to Schedule
Significant assumptions used in preparation of actuarial valuation
Valuation date 9/30/2018 (rolled forward to 9/30/2019)
Actuarial cost method Entry Age Normal
Amortization method Level Dollar Method
Remaining amortization period 28 years - closed period
Amortization period for new losses 25-year closed
Asset valuation method Market value
Discount rate 7.5%
Inflation 2.5%
Healthcare cost trend rates 7.3% increasing/declining annually to 4.2% in 2044+
Dental cost trend rates 3.0% per annum
Salary increases including inflation 2.75%
Long-term investment rate of return,
net of investment expense 7.5%
Retirement age Varies with age and service level
Mortality Adjusted RPH-2014 Generational table with MP-2018 Projection
CITY OF EULESS, TEXAS
BUDGETARY COMPARISON SCHEDULE
GENERAL FUND
YEAR ENDED SEPTEMBER 30, 2019
84
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
General property tax
Current and delinquent taxes 15,185,605$ 15,185,605$ 15,136,632$ (48,973)$
Penalty and interest 65,000 65,000 56,913 (8,087)
Total property tax 15,250,605 15,250,605 15,193,545 (57,060)
Gross receipts and mixed beverage tax
Telephone line access fee 268,000 268,000 250,706 (17,294)
Electric company 1,700,266 1,700,266 1,680,213 (20,053)
Gas company 430,000 430,000 381,306 (48,694)
Cable TV 580,000 580,000 551,611 (28,389)
City garbage service 252,000 252,000 264,926 12,926
Water and wastewater system 1,298,677 1,298,677 1,289,265 (9,412)
Others 191,300 191,300 160,095 (31,205)
Total gross receipts and
mixed beverage tax 4,720,243 4,720,243 4,578,122 (142,121)
General sales tax 13,193,953 13,193,953 13,038,632 (155,321)
Fines and fees
Municipal court fines 2,383,980 2,383,980 2,080,267 (303,713)
Jail income 200,000 200,000 175,239 (24,761)
Dog licenses and pound fees 7,500 7,500 7,605 105
Ambulance fees 1,010,000 1,010,000 905,783 (104,217)
Library fees 5,100 5,100 5,649 549
Zoning fees 17,000 17,000 20,041 3,041
Deferred adjudication fee 130,000 130,000 118,475 (11,525)
Total fines and fees 3,753,580 3,753,580 3,313,059 (440,521)
Licenses and permits
Building permits 300,000 300,000 1,720,499 1,420,499
Miscellaneous permits 274,000 274,000 321,552 47,552
Minimum housing 79,015 79,015 63,665 (15,350)
Total licenses and permits 653,015 653,015 2,105,716 1,452,701
Investment income 170,000 170,000 442,141 272,141
Intergovernmental 420,000 420,000 422,585 2,585
Other revenues
Rental income 559,594 559,594 712,912 153,318
Swimming pools 185,000 185,000 249,384 64,384
Miscellaneous income 249,650 249,650 179,669 (69,981)
Total other revenues 994,244 994,244 1,141,965 147,721
Total revenues 39,155,640 39,155,640 40,235,765 1,080,125
Budgeted Amounts
CITY OF EULESS, TEXAS
BUDGETARY COMPARISON SCHEDULE
GENERAL FUND
YEAR ENDED SEPTEMBER 30, 2019
(Continued)
85
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Expenditures
Current
Culture and recreation 3,476,886$ 3,476,886$ 3,308,005$ 168,881$
Development services 796,527 796,527 764,542 31,985
General and administrative 11,810,031 11,608,796 9,026,664 2,582,132
Highways and streets 1,404,700 1,404,700 1,366,556 38,144
Public safety 25,267,822 25,267,822 24,818,499 449,323
Total expenditures 42,755,966 42,554,731 39,284,266 3,270,465
Excess (deficiency) of revenues
over (under) expenditures (3,600,326) (3,399,091) 951,499 4,350,590
Other financing sources (uses)
Proceeds from sale of assets 4,000 4,000 8,145 4,145
Transfers in 2,979,037 2,979,037 2,970,891 (8,146)
Transfers out (1,343,456) (1,544,691) (1,511,613) 33,078
Total other financing
sources (uses), net 1,639,581 1,438,346 1,467,423 29,077
Net change in fund balance (1,960,745) (1,960,745) 2,418,922 4,379,667
Fund balance,
beginning of year 14,554,693 14,554,693 14,554,693 -
Fund balance, end of year 12,593,948$ 12,593,948$ 16,973,615$ 4,379,667$
Budgeted Amounts
CITY OF EULESS, TEXAS
BUDGETARY COMPARISON SCHEDULE
CAR RENTAL SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
86
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
Car rental tax 14,760,765$ 14,760,765$ 14,797,320$ 36,555$
Investment income 75,000 75,000 231,387 156,387
Total revenues 14,835,765 14,835,765 15,028,707 192,942
Expenditures
General and administrative 9,940,510 9,940,510 9,843,484 97,026
Capital outlay 381,339 381,339 - 381,339
Total expenditures 10,321,849 10,321,849 9,843,484 478,365
Excess of revenues over
expenditures 4,513,916 4,513,916 5,185,223 671,307
Other financing uses
Transfers out (5,481,658) (5,531,658) (5,531,658) -
Total other
financing uses (5,481,658) (5,531,658) (5,531,658) -
Net change in fund balance (967,742) (1,017,742) (346,435) 671,307
Fund balance, beginning of year 4,708,626 4,708,626 4,708,626 -
Fund balance, end of year 3,740,884$ 3,690,884$ 4,362,191$ 671,307$
Budgeted Amounts
CITY OF EULESS, TEXAS
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
87
NOTE 1. BUDGET BASIS OF ACCOUNTING
The City Council adheres to the following procedures in establishing budgetary data reflected in the
financial statements:
1. Prior to August 1, the City Manager submits to the City Council a proposed operating budget
for the fiscal year commencing the following October 1. The operating budget includes
proposed expenditures and expenses and means of financing them.
2. Public hearings are conducted to obtain taxpayers' comments.
3. Prior to September 30, the budget is legally enacted through passage of an ordinance and a
budgetary report is prepared.
4. The City Manager is authorized to transfer budgeted amounts between departments within
any fund; however, any revision that alters the total expenditures or expenses of any fund
must be approved by the City Council. The budget presented reflects revisions made during
the year. The legal level of control is at the fund level.
5. A budget is legally adopted for the general fund and special revenue funds on a basis
consistent with accounting principles generally accepted in the United States of America.
Formal budgetary integration is employed as a management control device during the year
for the general fund and special revenue funds. Appropriations and encumbrances lapse at
year-end.
6. Formal budgetary integration is not employed for the debt service funds because effective
budgetary control is alternatively achieved through general obligation bond indenture
provisions.
7. Budgetary data for the capital projects funds has not been presented in the accompanying
basic financial statements as such funds are budgeted over the life of the respective projects
and not on an annual basis. Accordingly, formal budgetary integration of the capital projects
funds is not employed and comparison of actual results of operations to budgetary data for
such funds is not presented.
8. Appropriated budgets for the proprietary funds are also adopted but have not been presented
since reporting on such budgets is not legally required.
The Budgetary Comparison Schedules – general fund and car rental tax special revenue fund present
a comparison of budgetary data to actual results. These funds utilize the same basis of accounting
for both budgetary purposes and actual results.
88
89
COMBINING AND INDIVIDUAL FUND
STATEMENTS AND SCHEDULES
90
NON-MAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS
Special revenue funds are used to account for specific revenues that are legally restricted to
expenditures for particular purposes.
Hotel/Motel Fund – to account for the operations and expenditures for which hotel/motel
occupancy taxes are used. Occupancy tax revenues are used primarily for advertising and
promotion of the City.
Half-Penny Sales Tax Fund – to account for the sales tax revenues and expenditures of the
Euless Development Corporation, a component unit of the City of Euless. The revenues can only
be spent on parks, library, debt service, and economic development activities with the City of
Euless.
Police Drug Enforcement Fund – to account for proceeds from the sale of assets seized in
connection with drug arrests. Revenues are used solely for police department expenditures.
Crime Control and Prevention District Fund – to account for the revenues and expenditures of
this component unit of the City of Euless. The revenues are collected from sales taxes and
expenditures can only be spent for police department operations and capital as approved by the
Crime Control and Prevention District Board.
Grant Fund – to account for grant revenues received by the City, which must be spent in
accordance with the grant provisions.
Police Seized Asset Fund – to account for resources received from asset forfeiture pursuant to
court judgment File No. 09-13-640 to be administered in compliance with Chapter 59, Texas
Code of Criminal Procedure.
Juvenile Case Fund – to account for a fee added to municipal court citations. This fee is used to
support the expenditures associated with juvenile case processing.
Glade Parks Public Improvement District (PID) Fund – to account for the accumulation of
resources from an assessment levied upon properties within the district boundaries. The
resources are utilized for the repayment of debt issued to fund public improvements within the
district. The district assesses property owners only for the portion of the debt payment not
covered with resources of the Glade Parks TIRZ #3.
Tax Increment Reinvestment Zone (TIRZ) #3 – Glade Parks Fund (TIRZ #3) – to account for the
accumulation of a portion of the incremental property taxes from taxing entities participating in
the tax increment reinvestment zone. The resources are used for the repayment of debt issued to
fund public improvements within the district.
91
NON-MAJOR GOVERNMENTAL FUNDS – Continued
Midtown Public Improvement District (PID) Fund – to account for the accumulation of resources
from an assessment levied upon properties within the district boundaries. The resources are
utilized for the repayment of debt issued to fund public improvements within the district.
Midtown TIRZ #4 Fund – to account for the accumulation of a portion of the incremental
property taxes from taxing entities participating in the tax increment reinvestment zone. The
resources are used for the repayment of debt issued to fund public improvements within the
district.
Cable PEG Fees Fund – to account for a 1% fee collected from cable channel providers for
expansion of the city’s public, educational, and governmental access channel.
CAPITAL PROJECTS FUNDS
Half-Penny Sales Tax CIP Fund – to account for bond proceeds and sales tax receipts to be
expended for capital projects funded by the Euless Development Corporation, a component unit
of the City of Euless.
Developers' Contribution Fund – to account for funds received for the purpose of making new
and future improvements to various development areas within the City.
General CIP Fund – to account for various general construction projects within the City.
Redevelopment CIP Fund – to account for land acquisition and revitalization projects designed
to enhance development and promote redevelopment throughout the community.
Midtown Reserve Fund – to account for resources used to establish the initial debt reserve fund
per the Midtown construction, funding, and development agreement.
TIRZ #4 Midtown CIP Fund – to account for construction projects and the means of financing
such projects within the development area generally known as Euless Midtown.
Car Rental CIP Fund – to account for the building and infrastructure projects that are funded
from the short-term motor vehicle rental tax.
CITY OF EULESS, TEXAS
COMBINING BALANCE SHEET
NON-MAJOR GOVERNMENTAL FUNDS
SEPTEMBER 30, 2019
92
Police Crime
Drug Control and
Hotel/Half-Penny Enforce-Prevention
Motel Sales Tax ment District Grant
Fund Fund Fund Fund Fund
ASSETS
Deposits and investments 587,100$ 2,799,264$ 526,962$ 953,500$ -$
Accounts receivable 188,300 - - - 69,152
Property taxes receivable - - - - -
Accrued interest receivable - 3,510 - - -
Due from other governments - 919,848 - 465,152 -
Restricted deposits and investments - - - - -
Total assets 775,400$ 3,722,622$ 526,962$ 1,418,652$ 69,152$
LIABILITIES
Liabilities
Accounts payable 266,043$ 112,870$ 1,500$ 1,926$ 65,620$
Accrued salaries and wages - 94,039 - 120,857 2,719
Total liabilities 266,043 206,909 1,500 122,783 68,339
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - - - - -
Total deferred inflows of resources - - - - -
FUND BALANCES
Fund Balances
Nonspendable - - - - -
Restricted, debt service - 263,861 - - -
Restricted, capital projects - - - - -
Restricted, developer agreements - - - - -
Restricted, juvenile case management - - - - -
Restricted, cable PEG fees - - - - -
Restricted, historical preservation 1,245 - - - -
Assigned 508,112 3,251,852 525,462 1,295,869 813
Total fund balances 509,357 3,515,713 525,462 1,295,869 813
Total liabilities, deferred inflows of
resources, and fund balances 775,400$ 3,722,622$ 526,962$ 1,418,652$ 69,152$
Special Revenue Funds
93
Police Cable Special
Seized Juvenile Glade Parks TIRZ #3 Midtown Midtown PEG Revenue
Assets Case PID Glade Parks PID TIRZ #4 Fees Funds
Fund Fund Fund Fund Fund Fund Fund Total
279,543$ 287,972$ 750,000$ 1,145,696$ 87,437$ 39,865$ 759,969$ 8,217,308$
- 4,584 - 40,726 - - 27,000 329,762
- - - 26,777 - 11,859 - 38,636
- - - - - - - 3,510
- - - - - - - 1,385,000
- - - - - - - -
279,543$ 292,556$ 750,000$ 1,213,199$ 87,437$ 51,724$ 786,969$ 9,974,216$
-$ 2,995$ -$ -$ -$ -$ 895$ 451,849$
2,087 4,072 - - - - - 223,774
2,087 7,067 - - - - 895 675,623
- 4,612 - - - - - 4,612
- 4,612 - - - - - 4,612
- - - - - - - -
- - 750,000 - - - - 1,013,861
- - - - - - - -
- - - - - - - -
- 280,877 - - - - - 280,877
- - - - - - 786,074 786,074
- - - - - - - 1,245
277,456 - - 1,213,199 87,437 51,724 - 7,211,924
277,456 280,877 750,000 1,213,199 87,437 51,724 786,074 9,293,981
279,543$ 292,556$ 750,000$ 1,213,199$ 87,437$ 51,724$ 786,969$ 9,974,216$
Special Revenue Funds
CITY OF EULESS, TEXAS
COMBINING BALANCE SHEET
NON-MAJOR GOVERNMENTAL FUNDS
SEPTEMBER 30, 2019
94
Half-Penny
Sales Tax Developers'General Redevelopment
CIP Contribution CIP CIP
Fund Fund Fund Fund
ASSETS
Deposits and investments 915,237$ 2,240,331$ 1,856,002$ 971,143$
Accounts receivable 13,712 - 5,840 -
Property taxes receivable - - - -
Accrued interest receivable 6,263 611 - -
Due from other governments - - - -
Restricted deposits and investments 650,796 - - -
Total assets 1,586,008$ 2,240,942$ 1,861,842$ 971,143$
LIABILITIES
Liabilities
Accounts payable 247,825$ -$ -$ -$
Accrued salaries and wages - - - -
Total liabilities 247,825 - - -
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - - - -
Total deferred inflows of resources - - - -
FUND BALANCES
Fund Balances
Nonspendable - - - -
Restricted, debt service - - - -
Restricted, capital projects 650,796 - - -
Restricted, developer agreements - 2,240,942 - -
Restricted, juvenile case management - - - -
Restricted, cable PEG fees - - - -
Restricted, historical preservation - - - -
Assigned 687,387 - 1,861,842 971,143
Total fund balances 1,338,183 2,240,942 1,861,842 971,143
Total liabilities, deferred inflows of
resources, and fund balances 1,586,008$ 2,240,942$ 1,861,842$ 971,143$
Capital Project Funds
95
TIRZ #4 Car Capital Total
Midtown Midtown Rental Project Non-major
Reserve CIP CIP Funds Governmental
Fund Fund Fund Totals Funds
-$ -$ 4,311,943$ 10,294,656$ 18,511,964$
- - - 19,552 349,314
- - - - 38,636
- - 28,007 34,881 38,391
- - - - 1,385,000
999,725 69,475 - 1,719,996 1,719,996
999,725$ 69,475$ 4,339,950$ 12,069,085$ 22,043,301$
-$ -$ 492,803$ 740,628$ 1,192,477$
- - - - 223,774
- - 492,803 740,628 1,416,251
- - - - 4,612
- - - - 4,612
- - - - -
- - - - 1,013,861
999,725 69,475 - 1,719,996 1,719,996
- - - 2,240,942 2,240,942
- - - - 280,877
- - - - 786,074
- - - - 1,245
- - 3,847,147 7,367,519 14,579,443
999,725 69,475 3,847,147 11,328,457 20,622,438
999,725$ 69,475$ 4,339,950$ 12,069,085$ 22,043,301$
CITY OF EULESS, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND
BALANCES – NON-MAJOR GOVERNMENTAL FUNDS
YEAR ENDED SEPTEMBER 30, 2019
96
Police Crime
Drug Control and
Hotel/Half-Penny Enforce-Prevention
Motel Sales Tax ment District Grant
Fund Fund Fund Fund Fund
Revenues
General property tax -$ -$ -$ -$ -$
Gross receipts tax 841,588 - - - -
General sales tax - 5,356,697 - 2,671,390 -
Investment income 12,130 41,367 11,447 20,094 -
DEA revenues - - 18,353 - -
Intergovernmental - - - - 191,147
Rents and royalties - 73,580 - - -
Other revenues - - - - -
Total revenues 853,718 5,471,644 29,800 2,691,484 191,147
Expenditures
Culture and recreation - 2,749,421 - - 6,000
Development services - 206,703 - - -
General and administrative 270,870 236,087 - - -
Public safety - - 23,448 2,651,548 211,562
Debt service
Principal - 110,000 - - -
Interest and fiscal charges - 50,435 - - -
Capital outlay - 130,435 - 28,240 10,889
Total expenditures 270,870 3,483,081 23,448 2,679,788 228,451
Excess (deficiency) of revenues
over (under) expenditures 582,848 1,988,563 6,352 11,696 (37,304)
Other financing sources (uses)
Issuance of debt - - - - -
Premium on issuance of debt - - - - -
Proceeds from sale of assets - 3,735 - - -
Transfers in - - - - 37,711
Transfers out (496,937) (1,032,834) - - -
Total other
financing sources (uses)(496,937) (1,029,099) - - 37,711
Net change in fund balances 85,911 959,464 6,352 11,696 407
Fund balance,
beginning of year 423,446 2,556,249 519,110 1,284,173 406
Fund balance, end of year 509,357$ 3,515,713$ 525,462$ 1,295,869$ 813$
Special Revenue Funds
97
Police Cable Special
Seized Juvenile Glade Parks TIRZ #3 Midtown Midtown PEG Revenue
Asset Case PID Glade Parks PID TIRZ #4 Fees Funds
Fund Fund Fund Fund Fund Fund Fund Totals
-$ -$ -$ 1,266,741$ -$ 51,724$ -$ 1,318,465$
- - - - - - 109,122 950,710
- - - 353,112 - - - 8,381,199
6,252 5,799 - 21,793 676 - 16,221 135,779
- - - - - - - 18,353
- - - - - - - 191,147
- - - - - - - 73,580
- 77,939 - - 1,114,507 - - 1,192,446
6,252 83,738 - 1,641,646 1,115,183 51,724 125,343 12,261,679
- - - - - - - 2,755,421
- - - - - - - 206,703
- 72,367 - - 20,381 - 16,934 616,639
33,181 - - - - - - 2,919,739
- - - - - - - 110,000
- - - - - - - 50,435
- - - - - - 12,731 182,295
33,181 72,367 - - 20,381 - 29,665 6,841,232
(26,929) 11,371 - 1,641,646 1,094,802 51,724 95,678 5,420,447
- - - - - - - -
- - - - - - - -
13,745 - - - - - - 17,480
- - - - - - - 37,711
- - - (1,130,268) (1,077,388) - - (3,737,427)
13,745 - - (1,130,268) (1,077,388) - - (3,682,236)
(13,184) 11,371 - 511,378 17,414 51,724 95,678 1,738,211
290,640 269,506 750,000 701,821 70,023 - 690,396 7,555,770
277,456$ 280,877$ 750,000$ 1,213,199$ 87,437$ 51,724$ 786,074$ 9,293,981$
Special Revenue Funds
CITY OF EULESS, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND
BALANCES – NON-MAJOR GOVERNMENTAL FUNDS
YEAR ENDED SEPTEMBER 30, 2019
98
Half-Penny
Sales Tax Developers'General Redevelopment
CIP Contribution CIP CIP
Fund Fund Fund Fund
Revenues
General property tax -$ -$ -$ -$
Gross receipts tax - - - -
General sales tax - - - -
Investment income 82,892 47,529 36,592 30,021
DEA revenues - - - -
Intergovernmental - - - -
Rents and royalties - - 45,223 -
Other revenues - 28,319 - -
Total revenues 82,892 75,848 81,815 30,021
Expenditures
Culture and recreation 124,842 70,224 - -
Development services 30,342 - - -
General and administrative - - - 98,202
Public safety - - - -
Debt service
Principal - - - -
Interest and fiscal charges - - - -
Capital outlay 3,471,365 - - 799,415
Total expenditures 3,626,549 70,224 - 897,617
Excess (deficiency) of revenues
over (under) expenditures (3,543,657) 5,624 81,815 (867,596)
Other financing sources (uses)
Issuance of debt 1,635,000 - - -
Premium on issuance of debt 39,041 - - -
Proceeds from sale of assets - - - -
Transfers in 847,493 - 201,448 500,000
Transfers out - (32,753) - -
Total other
financing sources (uses)2,521,534 (32,753) 201,448 500,000
Net change in fund balances (1,022,123) (27,129) 283,263 (367,596)
Fund balance,
beginning of year 2,360,306 2,268,071 1,578,579 1,338,739
Fund balance, end of year 1,338,183$ 2,240,942$ 1,861,842$ 971,143$
Capital Project Funds
99
TIRZ #4 Car Capital Total
Midtown Midtown Rental Project Non-major
Reserve CIP CIP Funds Governmental
Fund Fund Fund Totals Funds
-$ -$ -$ -$ 1,318,465$
- - - - 950,710
- - - - 8,381,199
- - 123,810 320,844 456,623
- - - - 18,353
- - - - 191,147
- - - 45,223 118,803
- - - 28,319 1,220,765
- - 123,810 394,386 12,656,065
- - - 195,066 2,950,487
- - - 30,342 237,045
- - 4,145 102,347 718,986
- - - - 2,919,739
- - - - 110,000
- - - - 50,435
- 312,877 1,454,656 6,038,313 6,220,608
- 312,877 1,458,801 6,366,068 13,207,300
- (312,877) (1,334,991) (5,971,682) (551,235)
- - - 1,635,000 1,635,000
- - - 39,041 39,041
- - - - 17,480
- - 3,039,900 4,588,841 4,626,552
- - - (32,753) (3,770,180)
- - 3,039,900 6,230,129 2,547,893
- (312,877) 1,704,909 258,447 1,996,658
999,725 382,352 2,142,238 11,070,010 18,625,780
999,725$ 69,475$ 3,847,147$ 11,328,457$ 20,622,438$
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
HOTEL / MOTEL SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
100
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
Gross receipts tax 864,690$ 864,690$ 841,588$ (23,102)$
Investment income 5,000 5,000 12,130 7,130
Total revenues 869,690 869,690 853,718 (15,972)
Expenditures
General and administrative 400,766 433,230 270,870 162,360
Total expenditures 400,766 433,230 270,870 162,360
Excess of revenues
over expenditures 468,924 436,460 582,848 146,388
Other financing uses
Transfers out (518,102) (518,102) (496,937) 21,165
Total other financing uses (518,102) (518,102) (496,937) 21,165
Net change in fund balance (49,178) (81,642) 85,911 167,553
Fund balance, beginning of year 423,446 423,446 423,446 -
Fund balance, end of year 374,268$ 341,804$ 509,357$ 167,553$
Budgeted Amounts
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
HALF-PENNY SALES TAX SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
101
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
General sales tax 5,413,479$ 5,413,479$ 5,356,697$ (56,782)$
Investment income 14,150 14,150 41,367 27,217
Rents and royalties 73,580 73,580 73,580 -
Total revenues 5,501,209 5,501,209 5,471,644 (29,565)
Expenditures
Culture and recreation 3,810,177 3,810,177 2,879,856 930,321
Development services 755,141 755,141 206,703 548,438
General and administrative 275,156 275,156 236,087 39,069
Debt service
Principal 95,000 95,000 110,000 (15,000)
Interest and fiscal charges 154,054 154,054 50,435 103,619
Total expenditures 5,089,528 5,089,528 3,483,081 1,606,447
Excess of revenues
over expenditures 411,681 411,681 1,988,563 1,576,882
Other financing sources (uses)
Proceeds from sale of assets - - 3,735 3,735
Transfers out (1,066,533) (1,066,533) (1,032,834) 33,699
Total other financing
sources (uses), net (1,066,533) (1,066,533) (1,029,099) 37,434
Net change in fund balance (654,852) (654,852) 959,464 1,614,316
Fund balance, beginning of year 2,556,249 2,556,249 2,556,249 -
Fund balance, end of year 1,901,397$ 1,901,397$ 3,515,713$ 1,614,316$
Budgeted Amounts
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
POLICE DRUG ENFORCEMENT SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
102
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
Investment income 7,300$ 7,300$ 11,447$ 4,147$
DEA revenues - - 18,353 18,353
Total revenues 7,300 7,300 29,800 22,500
Expenditures
Public safety 200,500 200,500 23,448 177,052
Total expenditures 200,500 200,500 23,448 177,052
Excess (deficiency) of revenues
over (under) expenditures (193,200) (193,200) 6,352 199,552
Net change in fund balance (193,200) (193,200) 6,352 199,552
Fund balance, beginning of year 519,110 519,110 519,110 -
Fund balance, end of year 325,910$ 325,910$ 525,462$ 199,552$
Budgeted Amounts
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
CRIME CONTROL AND PREVENTION DISTRICT SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
103
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
General sales tax 2,672,030$ 2,672,030$ 2,671,390$ (640)$
Investment income 11,885 11,885 20,094 8,209
Total revenues 2,683,915 2,683,915 2,691,484 7,569
Expenditures
Public safety 2,782,684 2,782,684 2,679,788 102,896
Total expenditures 2,782,684 2,782,684 2,679,788 102,896
Excess (deficiency) of revenues
over (under) expenditures (98,769) (98,769) 11,696 110,465
Net change in fund balance (98,769) (98,769) 11,696 110,465
Fund balance, beginning of year 1,284,173 1,284,173 1,284,173 -
Fund balance, end of year 1,185,404$ 1,185,404$ 1,295,869$ 110,465$
Budgeted Amounts
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
GRANT SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
104
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
Intergovernmental 129,002$ 129,002$ 191,147$ 62,145$
Total revenues 129,002 129,002 191,147 62,145
Expenditures
Culture and recreation - 6,000 6,000 -
Public safety 151,118 208,116 222,451 (14,335)
Total expenditures 151,118 214,116 228,451 (14,335)
Deficiency of revenues
under expenditures (22,116) (85,114) (37,304) 47,810
Other financing sources
Transfers in 35,456 35,456 37,711 2,255
Total other financing sources 35,456 35,456 37,711 2,255
Net change in fund balance 13,340 (49,658) 407 50,065
Fund balance, beginning of year 406 406 406 -
Fund balance, end of year 13,746$ 49,252)($ 813$ 50,065$
Budgeted Amounts
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
POLICE SEIZED ASSETS SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
105
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
Investment income 3,500$ 3,500$ 6,252$ 2,752$
Total revenues 3,500 3,500 6,252 2,752
Expenditures
Public safety 61,506 61,506 33,181 28,325
Total expenditures 61,506 61,506 33,181 28,325
Deficiency of revenues
under expenditures (58,006) (58,006) (26,929) 31,077
Other financing sources
Proceeds from sale of assets - - 13,745 13,745
Total other financing sources - - 13,745 13,745
Net change in fund balance (58,006) (58,006) (13,184) 44,822
Fund balance, beginning of year 290,640 290,640 290,640 -
Fund balance, end of year 232,634$ 232,634$ 277,456$ 44,822$
Budgeted Amounts
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
JUVENILE CASE SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
106
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
Investment income 3,000$ 3,000$ 5,799$ 2,799$
Other revenues 91,000 91,000 77,939 (13,061)
Total revenues 94,000 94,000 83,738 (10,262)
Expenditures
General and administrative 81,317 81,317 72,367 8,950
Total expenditures 81,317 81,317 72,367 8,950
Net change in fund balance 12,683 12,683 11,371 (1,312)
Fund balance, beginning of year 269,506 269,506 269,506 -
Fund balance, end of year 282,189$ 282,189$ 280,877$ (1,312)$
Budgeted Amounts
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
TIRZ #3 GLADE PARKS SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
107
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
General property tax 1,316,474$ 1,316,474$ 1,266,741$ (49,733)$
General sales tax 339,743 339,743 353,112 13,369
Investment income - - 21,793 21,793
Total revenues 1,656,217 1,656,217 1,641,646 (14,571)
Other financing uses
Transfers out (1,130,249) (1,130,249) (1,130,268) (19)
Total other
financing uses (1,130,249) (1,130,249) (1,130,268) (19)
Net change in fund balance 525,968 525,968 511,378 (14,590)
Fund balance, beginning of year 701,821 701,821 701,821 -
Fund balance, end of year 1,227,789$ 1,227,789$ 1,213,199$ (14,590)$
Budgeted Amounts
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
MIDTOWN PID SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
108
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
Other revenues 1,114,529$ 1,114,529$ 1,114,507$ (22)$
Investment income - - 676 676
Total revenues 1,114,529 1,114,529 1,115,183 654
Expenditures
General and administrative 37,141 37,141 20,381 16,760
Total expenditures 37,141 37,141 20,381 16,760
Excess of revenues over expenditures 1,077,388 1,077,388 1,094,802 17,414
Other financing uses
Transfers out (1,077,388) (1,077,388) (1,077,388) -
Total other financing uses (1,077,388) (1,077,388) (1,077,388) -
Net change in fund balance - - 17,414 17,414
Fund balance, beginning of year 70,023 70,023 70,023 -
Fund balance, end of year 70,023$ 70,023$ 87,437$ 17,414$
Budgeted Amounts
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
TIRZ #4 MIDTOWN SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
109
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
Property tax revenues 37,820$ 37,820$ 51,724$ 13,904$
Total revenues 37,820 37,820 51,724 13,904
Net change in fund balance 37,820 37,820 51,724 13,904
Fund balance, beginning of year - - - -
Fund balance, end of year 37,820$ 37,820$ 51,724$ 13,904$
Budgeted Amounts
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES –
BUDGET AND ACTUAL
CABLE PEG FEES SPECIAL REVENUE FUND
YEAR ENDED SEPTEMBER 30, 2019
110
Variance with
Actual Final Budget
GAAP Positive
Original Final Basis (Negative)
Revenues
Gross receipts tax 111,000$ 111,000$ 109,122$ (1,878)$
Investment income - - 16,221 16,221
Total revenues 111,000 111,000 125,343 14,343
Expenditures
General and administrative 60,000 60,000 16,934 43,066
Capital outlay 60,000 60,000 12,731 47,269
Total expenditures 120,000 120,000 29,665 90,335
Net change in fund balance (9,000) (9,000) 95,678 104,678
Fund balance, beginning of year 690,396 690,396 690,396 -
Fund balance, end of year 681,396$ 681,396$ 786,074$ 104,678$
Budgeted Amounts
111
INTERNAL SERVICE FUNDS
Internal service funds are used to account for the financing of goods or services provided by one
department to other departments of the City on a cost reimbursement basis.
Equipment Replacement Fund – to account for the accumulation of funds to be used for
replacement of existing equipment. Funding is provided annually by the user departments.
Insurance Fund – to account for the revenues and expenses resulting from providing health
insurance to the City's employees.
Risk Management/Workers’ Compensation (Risk/WC) Fund – to account for the revenue
and expenses applicable to providing workers’ compensation coverage for all City
employees, as well as, general liability and property coverage.
CITY OF EULESS, TEXAS
COMBINING STATEMENT OF NET POSITION
INTERNAL SERVICE FUNDS
SEPTEMBER 30, 2019
112
Equipment
Replacement Insurance Risk/WC
Fund Fund Fund Total
Deposits and investments 4,786,193$ 5,014,002$ 2,181,464$ 11,981,659$
Accounts receivable - 40,070 52,852 92,922
Prepaid expenses - 62,157 - 62,157
Accrued interest receivable 9,656 7,780 - 17,436
Total current assets 4,795,849 5,124,009 2,234,316 12,154,174
Property, plant, and equipment, at cost
Equipment 14,246,598 - 170,157 14,416,755
Less accumulated depreciation 8,655,681 - 51,693 8,707,374
Net property, plant, and equipment 5,590,917 - 118,464 5,709,381
Total assets 10,386,766 5,124,009 2,352,780 17,863,555
Accounts payable - 23,275 277,042 300,317
Accrued salary and wages - 5,853 4,054 9,907
Current portion of compensated absences - 457 119 576
Accrued insurance claims - 433,000 2,843 435,843
Total current liabilities - 462,585 284,058 746,643
Compensated absences - 4,115 1,072 5,187
Total non-current liabilities - 4,115 1,072 5,187
Total liabilities - 466,700 285,130 751,830
Net investment in capital assets 5,590,917 - 118,464 5,709,381
Unrestricted 4,795,849 4,657,309 1,949,186 11,402,344
Total net position 10,386,766$ 4,657,309$ 2,067,650$ 17,111,725$
ASSETS
LIABILITIES
NET POSITION
CITY OF EULESS, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES
IN NET POSITION
INTERNAL SERVICE FUNDS
YEAR ENDED SEPTEMBER 30, 2019
113
Equipment
Replacement Insurance Risk/WC
Fund Fund Fund Total
Operating revenues
Insurance premiums -$ 5,957,487$ 507,813$ 6,465,300$
Intergovernmental - - 48,077 48,077
Service fees and miscellaneous 1,536,169 869,152 - 2,405,321
Total operating revenues 1,536,169 6,826,639 555,890 8,918,698
Operating expenses
General and administrative 91,477 1,762,940 87,979 1,942,396
Insurance costs - 4,469,286 1,112,837 5,582,123
Depreciation 1,374,829 - 12,461 1,387,290
Total operating expenses 1,466,306 6,232,226 1,213,277 8,911,809
Operating income (loss)69,863 594,413 (657,387) 6,889
Nonoperating revenues
Gain on sale of capital assets 106,820 - - 106,820
Investment income 95,650 115,879 47,262 258,791
Total nonoperating revenues 202,470 115,879 47,262 365,611
Income (loss) before transfers 272,333 710,292 (610,125) 372,500
Transfers
Transfers in 376,673 - 484,000 860,673
Transfers out (161) - (25,000) (25,161)
Net transfers 376,512 - 459,000 835,512
Change in net position 648,845 710,292 (151,125) 1,208,012
Net position, beginning of year 9,737,921 3,947,017 2,218,775 15,903,713
Net position, end of year 10,386,766$ 4,657,309$ 2,067,650$ 17,111,725$
CITY OF EULESS, TEXAS
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
YEAR ENDED SEPTEMBER 30, 2019
114
Equipment
Replacement Insurance Risk/WC
Fund Fund Fund Total
OPERATING ACTIVITIES
Cash received from customers 1,536,169$ 6,834,362$ 503,038$ 8,873,569$
Cash payments to suppliers for goods and services (99,759) (6,374,061) (1,152,329) (7,626,149)
Cash payments to employees for services - (78,628) (62,146) (140,774)
Net cash provided by (used in) operating activities 1,436,410 381,673 (711,437) 1,106,646
NONCAPITAL FINANCING ACTIVITIES
Transfers in 376,673 - 484,000 860,673
Transfers out (161) - (25,000) (25,161)
Net cash provided by noncapital financing activities 376,512 - 459,000 835,512
CAPITAL AND RELATED FINANCING ACTIVITIES
Purchase of capital assets (1,041,719) - (99,943) (1,141,662)
Proceeds from sale of capital assets 106,820 - - 106,820
Net cash used in capital and related financing activities (934,899) - (99,943) (1,034,842)
INVESTING ACTIVITIES
Interest received on investments 94,442 123,384 52,887 270,713
Net cash provided by investing activities 94,442 123,384 52,887 270,713
Net increase in cash and cash equivalents 972,465 505,057 (299,493) 1,178,029
Cash and cash equivalents, beginning of year 3,813,728 4,508,945 2,480,957 10,803,630
Cash and cash equivalents, end of year 4,786,193$ 5,014,002$ 2,181,464$ 11,981,659$
Reconciliation of operating income (loss) to net
cash provided by (used in) operating activities
Operating income (loss)69,863$ 594,413$ (657,387)$ 6,889$
Adjustments to reconcile operating income (loss) to
net cash provided by (used in) operating activities
Depreciation expense 1,374,829 - 12,461 1,387,290
Change in assets and liabilities
Receivables - 7,723 (52,852) (45,129)
Prepaids - (59,957) 3,000 (56,957)
Accounts payable (8,282) 12,512 (19,000) (14,770)
Accrued salaries and wages - 1,982 2,341 4,323
Accrued insurance claims - (175,000) - (175,000)
Net cash provided by (used in) operating activities 1,436,410$ 381,673$ (711,437)$ 1,106,646$
Reconciliation of cash to balance sheet:
Cash - current 4,786,193$ 5,014,002$ 2,181,464$ 11,981,659$
Cash and cash equivalents 4,786,193$ 5,014,002$ 2,181,464$ 11,981,659$
CITY OF EULESS, TEXAS
COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
ESCROW AGENCY FUNDS
YEAR ENDED SEPTEMBER 30, 2019
115
Balance Balance
October 1, September 30,
2018 Additions Deductions 2019
Stars Center Escrow Fund
Assets
Investments at fair value 1,427,488$ 32,954$ (31,849)$ 1,428,593$
Total assets 1,427,488$ 32,954$ (31,849)$ 1,428,593$
Liabilities
Due to other entities 1,420,547$ -$ -$ 1,420,547$
Refunds payable 6,941 8,046 (6,941) 8,046
Total liabilities 1,427,488$ 8,046$ (6,941)$ 1,428,593$
116
117
STATISTICAL SECTION
(Unaudited)
118
STATISTICAL SECTION
(Unaudited)
The statistical section of the City of Euless’ comprehensive annual financial report presents detailed
information as a context for understanding what the information in the financial statements, note
disclosures, and required supplementary information says about the City’s overall financial health.
Contents Tables
Financial Trends 1-4
The financial trend schedules contain trend information to help the reader
understand how the City’s financial performance and well-being have changed
over time.
Revenue Capacity 5-8
The revenue capacity schedules contain information to help the reader assess
the City’s most significant local revenue source, the property tax.
Debt Capacity 9-13
The debt capacity schedules present information to help the reader assess
the affordability of the City’s current level of outstanding debt (including that
of its blended component units) and the City’s ability to issue additional
debt in the future.
Demographic and Economic Information 14-15
The demographic and economic schedules offer demographic and economic
indicators to help the reader understand the environment within which
the City’s financial activities occur.
Operating Information 16-18
The operating information schedules contain service and infrastructure data
to help the reader understand how the information in the City’s financial
report relates to the services it provides and the activities it performs.
CITY OF EULESS, TEXAS
NET POSITION BY COMPONENT – LAST TEN FISCAL YEARS
(Accrual Basis of Accounting – Unaudited)
Table 1
119
Fiscal Year
2010*2011 2012 2013 2014 2015 2016 2017 2018 2019
Governmental activities
Net investment in capital assets 73,815,504$ 71,051,094$ 77,828,950$ 88,228,282$ 94,162,906$ 99,539,958$ 108,135,655$ 113,509,089$ 112,710,338$ 99,744,023$
Restricted 1,375,950 1,818,957 4,426,819 4,138,774 4,999,085 5,666,450 17,508,943 10,293,057 13,620,993 26,158,342
Unrestricted 24,933,443 31,448,528 27,192,202 24,910,579 23,921,387 17,302,574 3,610,521 12,466,943 10,698,663 18,071,669
Total governmental activities net position 100,124,897$ 104,318,579$ 109,447,971$ 117,277,635$ 123,083,378$ 122,508,982$ 129,255,119$ 136,269,089$ 137,029,994$ 143,974,034$
Business-type activities
Net investment in capital assets 53,318,214$ 53,132,882$ 52,202,849$ 52,334,570$ 55,160,898$ 55,396,268$ 59,184,256$ 62,421,284$ 63,283,054$ 65,621,697$
Restricted for debt service 438,340 438,948 309,595 314,171 317,758 733,562 733,164 733,264 1,018,037 1,426,830
Restricted for capital projects - - - - 232,300 1,183,350 4,265,268 1,166,442 3,962,644 10,646,450
Restricted for impact fees 2,999,156 2,649,336 2,401,217 2,740,656 1,876,393 1,966,315 1,980,150 2,467,095 2,895,677 3,047,942
Unrestricted 13,987,730 16,947,928 17,703,257 18,150,441 15,047,594 12,554,695 11,122,601 14,528,797 12,286,319 7,130,279
Total business-type activities net position 70,743,440$ 73,169,094$ 72,616,918$ 73,539,838$ 72,634,943$ 71,834,190$ 77,285,439$ 81,316,882$ 83,445,731$ 87,873,198$
Primary government
Net investment in capital assets 127,133,718$ 124,183,976$ 130,031,799$ 140,562,852$ 149,323,804$ 154,936,226$ 167,319,911$ 175,930,373$ 175,993,392$ 165,365,720$
Restricted 4,813,446 *4,907,241 7,137,631 7,193,601 7,425,536 9,549,677 24,487,525 14,659,858 21,497,351 41,279,564
Unrestricted 38,921,173 48,396,456 44,895,459 43,061,020 38,968,981 29,857,269 14,733,122 26,995,740 22,984,982 25,201,948
Total primary government net position 170,868,337$ *177,487,673$ 182,064,889$ 190,817,473$ 195,718,321$ 194,343,172$ 206,540,558$ 217,585,971$ 220,475,725$ 231,847,232$
Source: Comprehensive Annual Financial Reports
* recalculated
CITY OF EULESS, TEXAS
CHANGES IN NET POSITION – LAST TEN FISCAL YEARS
(Accrual Basis of Accounting – Unaudited)
Table 2
120
Fiscal Year
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Expenses
Governmental activities:
Culture and recreation 5,004,580$ 5,091,589$ 5,680,772$ 6,025,540$ 6,424,683$ 6,468,332$ 6,998,904$ 7,349,035$ 7,070,484$ 7,330,168$
Development services 1,692,845 1,707,148 972,770 1,155,089 1,367,005 877,713 918,214 999,153 1,038,328 1,057,414
General and administrative 14,571,600 15,698,832 15,910,313 17,145,752 18,017,535 19,949,733 20,722,236 20,816,148 21,356,342 21,112,696
Highways and streets 2,662,949 2,923,241 2,968,770 3,334,188 3,578,341 3,374,422 3,708,184 4,143,412 3,787,336 7,193,189
Public safety 21,416,966 20,754,733 22,316,429 23,324,328 24,278,144 23,807,143 26,673,966 28,265,072 27,424,253 30,352,705
Interest on long-term debt 1,885,177 1,618,420 1,327,482 1,227,084 1,126,017 1,136,786 1,807,001 1,502,912 1,632,302 2,010,814
Total governmental activities expenses 47,234,117 47,793,963 49,176,536 52,211,981 54,791,725 55,614,129 60,828,505 63,075,732 62,309,045 69,056,986
Business-type activities:
Water and wastewater 17,035,520 17,827,272 17,813,199 18,554,761 20,298,024 19,970,346 21,009,701 21,673,844 23,225,786 23,493,321
Drainage utility 1,107,206 1,177,938 1,283,617 1,245,838 1,373,036 1,319,999 1,414,483 1,396,736 1,515,183 1,563,021
Golf 4,460,627 4,483,252 4,599,099 4,750,359 4,152,015 4,155,834 4,409,773 4,632,475 4,764,095 4,731,810
Other recreation enterprises 1,866,786 1,982,613 2,115,730 2,312,949 2,288,337 2,009,582 2,211,065 2,321,414 2,416,337 2,270,768
Total business-type activities expenses 24,470,139 25,471,075 25,811,645 26,863,907 28,111,412 27,455,761 29,045,022 30,024,469 31,921,401 32,058,920
Total primary government expenses 71,704,256 73,265,038 74,988,181 79,075,888 82,903,137 83,069,890 89,873,527 93,100,201 94,230,446 101,115,906
Program Revenues
Governmental activities:
Fees, fines, and charges for services
Culture and recreation 66,368 69,950 65,912 297,361 304,283 317,024 291,349 264,307 252,000 266,091
Development services 751,323 779,939 1,263,477 1,186,347 1,321,040 1,409,703 1,717,416 2,019,496 1,875,120 2,133,420
General and administrative 1,548,497 1,707,890 1,760,023 1,383,779 1,347,600 1,342,091 1,285,797 1,156,745 1,066,075 861,929
Highways and streets - - 54,622 112,736 218,012 93,258 350,920 607,588 988,302 1,114,507
Public safety 4,345,101 3,271,115 3,097,141 3,355,604 3,567,917 3,452,086 3,383,743 3,151,407 3,104,895 2,541,205
Operating grants and contributions 511,093 469,404 481,655 2,978,933 633,080 597,437 578,007 592,870 740,969 622,061
Capital grants and contributions 602,372 1,015,402 689,642 1,213,341 1,552,118 3,228,945 3,375,733 2,356,556 2,354,450 1,304,420
Total governmental activities program revenues 7,824,754 7,313,700 7,412,472 10,528,101 8,944,050 10,440,544 10,982,965 10,148,969 10,381,811 8,843,633
Business-type activities:
Charges for services
Water and wastewater 17,321,670 19,978,802 18,437,963 19,183,198 19,353,144 20,593,262 23,759,236 24,178,812 27,504,814 26,400,731
Drainage utility 691,800 694,751 705,474 708,984 712,971 716,595 725,152 730,202 818,622 826,711
Golf 5,279,259 4,746,242 4,335,149 4,520,224 3,622,952 4,168,578 4,187,728 4,247,345 4,337,003 4,067,026
Other recreation enterprises 1,937,416 2,684,905 2,041,878 2,138,600 2,241,920 1,848,434 2,059,413 2,168,944 2,123,825 2,197,926
Operating grants and contributions - - - - - - - - - -
Capital grants and contributions 26,400 772,714 368,882 1,847,097 2,037,263 1,746,638 2,943,188 2,280,769 1,729,219 3,058,291
Total business-type activities program revenues 25,256,545 28,877,414 25,889,346 28,398,103 27,968,250 29,073,507 33,674,717 33,606,072 36,513,483 36,550,685
Total primary government program revenues 33,081,299 36,191,114 33,301,818 38,926,204 36,912,300 39,514,051 44,657,682 43,755,041 46,895,294 45,394,318
(Continued)(Continued)(Continued)(Continued)(Continued)(Continued)(Continued)(Continued)(Continued)(Continued)
CITY OF EULESS, TEXAS
CHANGES IN NET POSITION – LAST TEN FISCAL YEARS
(Accrual Basis of Accounting – Unaudited) – Continued
Table 2
121
Net (Expense) Revenue
Governmental activities (39,409,363)$ (40,480,263)$ (41,764,064)$ (41,683,880)$ (45,847,675)$ (45,173,585)$ (49,845,540)$ (52,926,763)$ (51,927,234)$ (60,213,353)$
Business-type activities 786,406 3,406,339 77,701 1,534,196 (143,162) 1,617,746 4,629,695 3,581,603 4,592,082 4,491,765
Total primary government net expense (38,622,957) (37,073,924) (41,686,363) (40,149,684) (45,990,837) (43,555,839) (45,215,845) (49,345,160) (47,335,152) (55,721,588)
General Revenues
and Other Changes in Net Position
Governmental activities:
Taxes
Property taxes, levied for general purposes 12,306,387 11,855,993 12,451,543 12,744,753 13,488,816 14,358,074 14,752,044 16,656,028 18,630,301 20,428,821
Sales taxes 12,337,598 13,252,805 14,957,757 16,142,357 17,525,123 18,359,717 20,364,878 21,252,491 20,728,210 21,419,831
Car rental taxes 11,480,736 12,457,910 12,933,884 13,592,255 14,082,518 14,112,552 14,842,109 14,401,763 14,776,566 14,797,320
Mixed beverage taxes 71,653 66,383 54,138 60,823 69,160 84,533 101,503 128,250 154,035 138,219
Hotel/motel occupancy taxes 237,429 272,809 292,931 329,368 343,312 391,991 696,805 798,905 864,829 841,588
Gross receipts taxes 3,967,036 4,174,627 4,276,136 4,209,564 4,458,682 4,556,355 4,467,535 4,455,137 4,811,119 4,549,026
Investment income 292,761 168,929 132,607 106,521 70,374 127,367 271,786 451,406 963,670 1,882,696
Rents and royalties - - 397,527 1,481,305 1,390,283 1,166,832 1,105,829 1,149,534 1,223,788 1,348,465
Gain/(loss) on disposal of assets 116,978 100,110 68,329 117,763 84,664 - - 124,792 - -
Miscellaneous 103,569 1,419,512 637,975 35,884 48,773 35,128 692,939 755,996 772,773 930,764
Transfers 647,463 904,867 690,629 692,951 531,974 722,702 (703,751) (233,569) 760,590 820,663
Total governmental activities 41,561,610 44,673,945 46,893,456 49,513,544 52,093,679 53,915,251 56,591,677 59,940,733 63,685,881 67,157,393
Business-type activities:
Investment income 87,799 66,161 60,752 40,045 34,063 40,282 104,618 158,805 385,513 746,865
Gain on disposal of assets 3,579 (141,979) - 41,630 - 4,199 13,185 57,466 2,873 9,500
Miscellaneous - - - - - - - - - -
Transfers (647,463) (904,867) (690,629) (692,951) (531,974) (722,702) 703,751 233,569 (760,590) (820,663)
Total business-type activities (556,085) (980,685) (629,877) (611,276) (497,911) (678,221) 821,554 449,840 (372,204) (64,298)
Total primary government 41,005,525 43,693,260 46,263,579 48,902,268 51,595,768 53,237,030 57,413,231 60,390,573 63,313,677 67,093,095
Change in Net Position
Governmental activities 2,152,247 4,193,682 5,129,392 7,829,664 6,246,004 8,741,666 6,746,137 7,013,970 11,758,647 6,944,040
Business-type activities 230,321 2,425,654 (552,176) 922,920 (641,073) 939,525 5,451,249 4,031,443 4,219,878 4,427,467
Total primary government 2,382,568$ 6,619,336$ 4,577,216$ 8,752,584$ 5,604,931$ 9,681,191$ 12,197,386$ 11,045,413$ 15,978,525$ 11,371,507$
(concluded)(concluded)(concluded)(concluded)(concluded)(concluded)(concluded)(concluded)(concluded)(concluded)
Source: Comprehensive Annual Financial Reports
CITY OF EULESS, TEXAS
FUND BALANCES, GOVERNMENTAL FUNDS – LAST TEN FISCAL YEARS
(Modified Accrual Basis of Accounting – Unaudited)
Table 3
122
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
General Fund
Reserved for other 492,776$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Nonspendable - 19,344 28,796 49,262 48,072 47,834 35,250 52,050 51,409 74,835
Restricted - 311,076 258,765 124,312 120,093 109,618 121,041 104,340 125,753 132,954
Assigned - 103,423 111,096 121,542 121,334 116,336 113,655 107,657 121,708 135,720
Unreserved/Unassigned 7,121,683 7,296,719 8,913,078 9,595,558 10,560,958 10,775,542 11,973,524 13,185,421 14,255,823 16,630,106
Total general fund 7,614,459$ 7,730,562$ 9,311,735$ 9,890,674$ 10,850,457$ 11,049,330$ 12,243,470$ 13,449,468$ 14,554,693$ 16,973,615$
All Other Governmental Funds
Reserved for:
Debt service 1,622,584$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Development Agreements 1,454,496 - - - - - - - - -
Other 7,677 - - - - - - - - -
Unreserved, reported in:
Special revenue funds 7,780,378 - - - - - - - - -
Capital funds 5,792,872 - - - - - - - - -
Nonspendable - 5,665 5,803 9,464 34,704 15,399 7,738 22,028 12,427 -
Restricted for:
Debt service - 1,818,957 1,867,971 1,776,644 2,377,710 2,477,981 1,995,548 2,285,719 2,765,013 3,429,240
Capital projects - 2,168,956 606,505 365,641 398,756 594,211 12,715,424 4,985,922 7,501,009 19,287,010
Other - 87,972 1,694,821 1,872,178 2,089,735 2,455,941 2,718,045 2,952,158 3,229,218 3,309,138
Assigned - 14,855,820 15,802,863 13,504,412 12,692,185 13,765,385 12,541,184 14,730,171 21,356,289 19,461,628
Total all other governmental funds 16,658,007$ 18,937,370$ 19,977,963$ 17,528,339$ 17,593,090$ 19,308,917$ 29,977,939$ 24,975,998$ 34,863,956$ 45,487,016$
Source: Comprehensive Annual Financial Reports
Note: The City of Euless first applied GASB Statement No. 54 "Fund Balance Reporting and Governmental Fund Type Definitions'" in fiscal year 2011. Reclassification of fund balances for prior years was not required.
CITY OF EULESS, TEXAS
CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(Modified Accrual Basis of Accounting – Unaudited)
Table 4
123
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Revenues:
General property tax 12,277,457$ 11,786,579$ 12,382,757$ 12,893,583$ 13,468,394$ 14,351,598$ 14,771,632$ 16,674,673$ 18,652,639$ 20,408,581$
Gross receipts tax 4,276,110 4,513,819 4,623,205 4,599,755 4,871,154 5,032,879 5,265,843 5,382,292 5,829,983 5,528,832
General sales tax 12,337,598 13,252,805 14,957,757 16,142,357 17,525,123 18,359,717 20,364,878 21,252,491 20,728,209 21,419,831
Car rental tax 11,480,736 12,457,910 12,933,884 13,592,255 14,082,518 14,112,552 14,842,109 14,401,763 14,776,566 14,797,320
Fines and fees 4,336,063 4,033,868 4,278,738 4,627,199 4,646,390 4,289,681 4,461,439 3,961,369 3,806,964 3,313,059
Licenses and permits 719,918 744,978 1,233,465 1,152,875 1,286,753 1,379,332 1,682,431 1,997,082 1,847,315 2,105,716
Investment income 253,302 143,564 107,195 92,118 57,880 105,443 237,949 385,769 821,642 1,623,907
DEA revenues 15,350 6,589 12,488 3,571 15,316 39,292 18,274 9,994 2,656 18,353
Intergovernmental 376,512 377,660 1,012,673 2,839,545 461,484 906,695 507,966 1,490,142 813,633 629,332
Rents and royalties 1,620,210 1,233,686 1,111,873 1,024,021 1,390,283 637,196 612,365 628,486 668,036 635,553
Other revenues 978,179 1,194,966 1,206,611 1,383,172 1,210,086 1,795,395 1,943,007 1,996,374 2,217,797 2,362,730
Total Revenues 48,671,435 49,746,424 53,860,646 58,350,451 59,015,381 61,009,780 64,707,893 68,180,435 70,165,440 72,843,214
Expenditures:
Culture and recreation 4,120,435 4,335,786 4,676,100 5,171,477 5,558,463 5,704,520 6,023,057 6,324,436 6,372,535 6,258,492
Development services 1,251,706 1,340,898 688,296 806,275 1,017,903 882,212 862,571 931,119 1,036,278 1,001,587
General and administrative 14,796,474 15,610,772 15,539,673 17,207,934 17,711,441 18,357,428 18,975,116 18,985,489 19,790,021 19,038,500
Highways and streets 610,996 713,742 861,748 1,144,223 1,351,404 1,606,372 1,688,714 1,616,714 1,222,905 4,555,735
Public safety 19,011,663 19,492,862 21,074,399 22,192,488 23,121,457 23,521,280 24,698,550 26,068,993 26,977,362 27,738,238
Debt Service:
Principal 3,110,000 3,445,000 8,210,000 3,975,000 5,567,404 4,284,197 3,530,000 3,848,825 4,761,697 4,828,848
Interest and fiscal charges 2,189,070 1,798,615 1,361,259 1,241,776 1,148,069 1,243,589 1,743,450 1,516,936 1,662,399 1,943,495
Issuance costs 95,000 178,229 184,966 26,064 - - - - - -
Capital outlay 6,865,802 4,805,147 3,727,193 10,390,582 2,672,010 9,086,345 14,871,624 10,600,631 6,839,864 8,979,048
Total expenditures 52,051,146 51,721,051 56,323,634 62,155,819 58,148,151 64,685,943 72,393,082 69,893,143 68,663,061 74,343,943
Excess (deficiency) of revenues
over (under) expenditures (3,379,711) (1,974,627) (2,462,988) (3,805,368) 867,230 (3,676,163) (7,685,189) (1,712,708) 1,502,379 (1,500,729)
Other Financing Sources (Uses):
Capital lease - 494,322 - 1,446,603 - - - 249,370 - -
Issuance of debt 8,110,000 9,610,000 9,740,000 1,160,000 - 11,400,000 20,760,000 - 9,805,000 13,420,000
Payment of escrow for refunding (8,443,763) (6,804,790) (5,381,310) (1,190,252) - (6,074,450) - - - -
Premiums on issuance of debt - 390,694 260,435 79,046 - 789,428 403,354 - 264,116 869,936
Bond discount (94,828) - - - - - - - - -
Proceeds from sale of assets - - - - - - - - 23,513 25,625
Transfers in 3,371,742 5,696,323 8,134,018 6,278,531 4,366,649 5,897,789 7,468,038 8,845,061 13,942,847 11,040,601
Transfers out (3,417,248) (5,016,456) (7,668,389) (5,839,245) (4,209,345) (6,421,904) (9,083,041) (11,177,666) (14,544,672) (10,813,451)
Total other financing sources (474,097) 4,370,093 5,084,754 1,934,683 157,304 5,590,863 19,548,351 (2,083,235) 9,490,804 14,542,711
Net change in fund balances (3,853,808)$ 2,395,466$ 2,621,766$ (1,870,685)$ 1,024,534$ 1,914,700$ 11,863,162$ (3,795,943)$ 10,993,183$ 13,041,982$
Debt service as a percentage
of noncapital expenditures 11.9%11.6%18.5%10.1%12.1%9.9%9.2%9.0%10.4%10.4%
Source: Comprehensive Annual Financial Reports
CITY OF EULESS, TEXAS
ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY – LAST TEN FISCAL YEARS
(Unaudited)
Table 5
124
Total
Less:Direct
Fiscal Real Personal Total Tax-Exempt Total Taxable Tax
Year Property Property Value Property Value Rate
2010 2,470,282,654 449,954,489 2,920,237,143 330,392,987 2,589,844,156 0.470000
2011 (1) 2,473,997,250 390,731,885 2,864,729,135 341,730,427 2,522,998,708 0.470000
2012 2,610,172,289 389,778,962 2,999,951,251 348,227,246 2,651,724,005 0.470000
2013 2,661,959,213 445,909,463 3,107,868,676 351,726,906 2,756,141,770 0.470000
2014 2,759,268,619 461,065,240 3,220,333,859 356,283,956 2,864,049,903 0.470000
2015 2,920,206,326 509,189,960 3,429,396,286 369,393,032 3,060,003,254 0.467500
2016 3,352,029,682 513,118,652 3,865,148,334 410,557,810 3,454,590,524 0.467500
2017 3,470,371,005 531,751,946 4,002,122,951 450,853,105 3,551,269,846 0.462500
2018 3,922,338,493 564,286,167 4,486,624,660 492,318,425 3,994,306,235 0.462500
2019 4,353,413,236 576,907,417 4,930,320,653 549,709,999 4,380,610,654 0.462500
Source: Tarrant Appraisal District
(1) Amounts prior to 2011 are shown at market value and amounts from 2011 forward are shown at appraised value.
Estimated Value
CITY OF EULESS, TEXAS
DIRECT AND OVERLAPPING PROPERTY TAX RATES (per $100 of Assessed Value) – LAST TEN FISCAL YEARS
(Unaudited)
Table 6
125
Fiscal
Year
Operating /
General Rate
General
Obligation Debt
Service Total Direct Rate
Hurst-Euless-
Bedford ISD
Grapevine-
Colleyville ISD Tarrant County
Tarrant County
Hospital District
Tarrant County
Community
College
2010 0.360791 0.109209 0.470000 1.2955 1.2900 0.2640 0.2280 0.1377
2011 0.343905 0.126095 0.470000 1.2882 1.2900 0.2640 0.2279 0.1376
2012 0.345388 0.124612 0.470000 1.4140 1.3100 0.2640 0.2280 0.1490
2013 0.355130 0.114870 0.470000 1.4075 1.3201 0.2640 0.2279 0.1490
2014 0.360619 0.109381 0.470000 1.3875 1.3201 0.2640 0.2279 0.1495
2015 0.364505 0.102995 0.467500 1.3750 1.3201 0.2640 0.2279 0.1495
2016 0.366571 0.100929 0.467500 1.3500 1.3201 0.2640 0.2279 0.1495
2017 0.363053 0.099447 0.462500 1.3160 1.3967 0.2540 0.2279 0.1447
2018 0.361056 0.101444 0.462500 1.2630 1.3967 0.2440 0.2244 0.1401
2019 0.371710 0.090790 0.462500 1.2730 1.3967 0.2340 0.2244 0.1361
Sources: City of Euless Budget Office, Tarrant Appraisal District
Overlapping RatesCity Direct Rates
CITY OF EULESS, TEXAS
PRINCIPAL PROPERTY TAXPAYERS
Current Year and Nine Years Ago
(Unaudited)
Table 7
126
Percentage Percentage
of Total City of Total City
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayer Value Value (1)Taxpayer Value Value (2)
Star Monticello LLC/Star Kensington LLC 100,900,000$ 2.30 %Avis Budget Group LLC 71,494,412$ 2.76 %
EAN Holdings LLC 89,401,459 2.04 Hertz Corp 59,138,506 2.28
Westdale Hills 2013 LP 83,608,284 1.91 Vanguard Car Rental USA, Inc.55,180,417 2.13
Brazos TX Partners LLC 75,060,000 1.71 UDR The Mandolin LLC 38,448,160 1.48
WOP Mandolin LLC 73,900,000 1.69 Somerset Village Partners LP 36,903,507 1.42
Stoneleigh at Bear Creek Apt.65,895,000 1.50 Oncor Electric Delivery Co. LLC 36,706,608 1.42
CMF 15 Portfolio LLC 61,200,000 1.40 CMF 15 Portfolio LLC 32,500,000 1.25
Bedrock Holdings II (Dallas) LLC 58,950,000 1.35 IRA Stoneleigh FEECO LLC 32,200,000 1.24
Avenue 900 Holdings LLC 52,590,662 1.20 Vineyard Village MSV LLC 31,421,752 1.21
Avis Rent a Car System LLC/Budget Car Rental 48,915,653 1.12 Seramont II LP 30,563,740 1.18
Total 710,421,058$ 16.22 %Total 424,557,102$ 16.37 %
Source: Tarrant County Tax Office
Notes:
(1) Total Taxable Value including real and personal property for tax year 2018 (fiscal year 2019) is $4,380,610,654.
(2) Total Taxable Value including real and personal property for tax year 2009 (fiscal year 2010) is $2,589,844,156.
Fiscal Year 2019 Fiscal Year 2010
CITY OF EULESS, TEXAS
PROPERTY TAX LEVIES AND COLLECTIONS – LAST TEN FISCAL YEARS
(Unaudited)
Table 8
127
Taxes Levied Adjustments Adjusted
Within the to Levy in Taxes Levied Collections
Fiscal Fiscal Year Subsequent for the Percentage in Subsequent Percentage Percentage
Year of the Levy Years Fiscal Year Amount of Levy Years Amount of Levy Amount of Levy
2010 12,318,061 (12,986)12,305,075 12,182,266 99.00%113,554 12,295,820 99.92%9,255 0.08%
2011 11,796,659 (39,704) 11,756,955 11,637,719 98.99%108,776 11,746,495 99.91%10,459 0.09%
2012 12,436,816 (89,925) 12,346,891 12,252,510 99.24%80,402 12,332,912 99.89%13,979 0.11%
2013 12,926,215 (227,241) 12,698,974 12,648,635 99.60%35,181 12,683,816 99.88%15,158 0.12%
2014 13,426,248 (70,742) 13,355,506 13,303,694 99.61%34,321 13,338,015 99.87%17,492 0.13%
2015 14,245,865 (193,585) 14,052,280 14,049,020 99.98%(12,186) 14,036,834 99.89%15,447 0.11%
2016 13,671,980 871,167 14,543,147 14,481,033 99.57%42,889 14,523,922 99.87%19,225 0.13%
2017 15,828,162 379,458 16,207,620 16,191,555 99.90%(4,820) 16,186,735 99.87%20,885 0.13%
2018 18,199,497 (34,530) 18,164,967 18,131,429 99.82%5,690 18,137,119 99.85%27,848 0.15%
2019 19,850,820 - 19,850,820 19,769,021 99.59%- 19,769,021 99.59%81,799 0.41%
Source: Tarrant County Tax Office and Tarrant Appraisal District
Delinquent TaxesTotal Collection
Collected within the
Fiscal Year of the Levy
CITY OF EULESS, TEXAS
RATIO OF OUTSTANDING DEBT BY TYPE – LAST TEN FISCAL YEARS
(Unaudited)
Table 9
128
Premiums/Premiums/
Discounts General Discounts
General Certificates Sales Tax on Debt Issues W&S Obligation on Debt Issues Total Percentage
Fiscal Obligation of Tax Revenue Capital and Losses on Revenue Refunding and Losses on Primary of Personal Per
Year Bonds Obligation Notes Bonds Leases Refundings (1)Bonds Bonds Refundings (1)Government Income (3)Capita (3)
2010 30,765,000 4,910,000 - 4,470,000 438,227 (735,696) 3,850,000 9,160,000 (886,175) 51,971,356 3.29%959$
2011 29,235,000 6,590,000 - 3,715,000 356,897 (373,493) 3,580,000 8,675,000 (825,449) 50,952,955 3.60%994$
2012 29,915,000 3,230,000 - 2,910,000 272,526 (495,831) 3,435,000 8,165,000 (930,576) 46,501,119 3.37%903$
2013 27,095,000 2,910,000 - 2,050,000 1,631,602 (396,737) 4,690,000 7,495,000 (610,729) 44,864,136 3.30%867$
2014 24,070,000 2,780,000 - 1,175,000 94,196 622,367 (2)4,285,000 6,915,000 237,146 (2)40,178,709 2.53%731$
2015 20,655,000 8,365,000 - 285,000 - 994,148 (2)10,940,000 6,320,000 211,601 (2)47,770,749 2.98%884$
2016 17,425,000 27,710,000 1,280,000 120,000 - 1,497,876 (2)10,305,000 5,695,000 186,063 (2)64,218,939 3.94%1,184$
2017 14,490,000 27,350,000 860,000 75,000 160,545 1,099,640 (2)9,540,000 5,240,000 168,446 (2)58,983,631 3.62%1,075$
2018 11,460,000 35,660,000 735,000 40,000 83,848 1,211,502 (2)11,545,000 4,770,000 150,830 (2)65,656,180 3.82%1,190$
2019 8,805,000 46,200,000 - 1,565,000 - 1,887,637 (2)19,905,000 4,295,000 133,213 (2)82,790,850 4.49%1,474$
Note: Details regarding the City's outstanding debt can be found in the notes to the Financial Statements.
(1)Column added to table in 2016; prior year figures have been restated to include amounts reflected.
(2)Calculations for fiscal years after 2013 do not include losses on refundings due to their balance sheet reclassification to Deferred Inflows of Resources.
(3)See Table 14 for personal income and population data.
Business-Type Activities Governmental Activities
CITY OF EULESS, TEXAS
RATIO OF NET GENERAL BONDED DEBT TO TAXABLE ASSESSED VALUE AND NET BONDED DEBT PER CAPITA –
LAST TEN FISCAL YEARS
(Unaudited)
Table 10
129
Premiums/
Discounts
General Certificates on Debt Issues Less: Debt Net O/S Net Debt Net General
Fiscal Obligation of and Losses on Service Debt Estimated Taxable to Taxable Debt Per
Year Bonds Obligation Refundings (1)Reserves Total Population (2)Value (3)Value Capita
2010 39,925,000 4,910,000 (1,484,544) 684,246 42,666,210 54,200 2,589,844,156 1.65%787$
2011 37,910,000 6,590,000 (1,074,877) 880,619 42,544,504 51,277 2,522,998,708 1.69%830$
2012 38,080,000 3,230,000 (1,126,577) 956,430 39,226,993 51,500 2,651,724,005 1.48%762$
2013 34,590,000 2,910,000 (721,626) 807,054 35,971,320 51,750 2,756,141,770 1.31%695$
2014 30,985,000 2,780,000 883,948 (5)796,454 33,852,494 53,780 2,864,049,903 1.18%629$
2015 26,975,000 8,365,000 1,228,901 (5)813,841 35,755,060 54,050 3,060,003,254 1.17%662$
2016 (4)23,120,000 27,710,000 1,446,619 (5)1,056,021 51,220,598 54,250 3,454,590,524 1.48%944$
2017 19,730,000 27,350,000 1,288,664 (5)1,398,495 46,970,169 54,870 3,551,269,846 1.32%856$
2018 16,230,000 35,660,000 1,381,631 (5)1,914,141 51,357,490 55,170 3,994,306,235 1.29%931$
2019 13,100,000 46,200,000 2,038,856 (5)2,415,379 58,923,477 56,160 4,380,610,654 1.35%1,049$
Note:
Source:(1) Column added to table in 2016, prior years restated to include amounts shown.
(2) Estimates by North Central Texas Council of Governments and Euless Planning and Development Department
(3) Tarrant Appraisal District
(4) Taxable value restated to fiscal year end amounts.
(5)Calculations for fiscal years after 2013 do not include losses on refundings due to their balance sheet reclassification to Deferred Inflows of Resources.
General Bonded Debt Outstanding
Details regarding the City's outstanding debt can be found in the Notes to the Financial Statements. Total does not include revenue bonds.
CITY OF EULESS, TEXAS
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
AS OF SEPTEMBER 30, 2019 – (Unaudited)
Table 11
130
Estimated
Estimated Share of
Debt Percentage Overlapping
Governmental Unit Outstanding Applicable Debt
Debt repaid with property taxes
Grapevine-Colleyville Independent School District 382,071,058$ 9.89%37,786,828$
Hurst-Euless-Bedford Independent School District 383,550,000 21.67%83,115,285
Tarrant County 266,375,000 2.48%6,606,100
Tarrant County Hospital District 17,735,000 2.48%439,828
Tarrant County College District - 2.48%-
Subtotal, overlapping debt 127,948,041
Debt repaid with property taxes
City of Euless (direct debt)56,543,834 100.00%56,543,834
Total direct and overlapping debt repaid with property taxes 184,491,875$
Notes:The percentage of overlapping debt applicable is estimated using taxable property values. Applicable percentages were
estimated by determining the portion of another governmental unit's taxable value that is within the City's boundaries and
dividing it by each unit's total taxable value.
The current year calculation of direct debt includes all general governmental activities debt excluding sales tax
revenue bonds which are not repaid with property taxes. Amounts shown have been adjusted for losses on prior
refundings, premiums, and discounts.
Source: Debt outstanding data provided by Municipal Advisory Council of Texas and City records.
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUE BOND COVERAGE WATER AND WASTEWATER BONDS – LAST TEN FISCAL YEARS
(Unaudited)
Table 12
131
Interest
Less Net and
Fiscal Total Operating Revenue Fiscal Coverage
Year Revenues (1)Expenses (2)Available Principal Charges Total Ratio
2010 17,475,984 14,799,879 2,676,105 255,000 171,452 426,452 6.28
2011 20,148,834 15,952,372 4,196,462 270,000 161,333 431,333 9.73
2012 18,714,408 15,824,724 2,889,684 90,000 105,785 195,785 14.76
2013 19,399,314 16,660,397 2,738,917 330,000 82,110 412,110 6.65
2014 19,729,539 18,269,093 1,460,446 405,000 122,229 527,229 2.77
2015 21,182,560 17,879,209 3,303,351 410,000 129,703 539,703 6.12
2016 24,311,965 18,625,302 5,686,663 635,000 181,747 816,747 6.96
2017 24,353,525 19,249,699 5,103,826 765,000 175,682 940,682 5.43
2018 27,828,648 20,880,984 6,947,664 780,000 184,154 964,154 7.21
2019 27,603,615 21,006,298 6,597,317 915,000 191,327 1,106,327 5.96
Notes: (1) Operating and nonoperating revenues of water and wastewater fund
(2) Total operating expenses of water and wastewater fund exclusive of depreciation and amortization
CITY OF EULESS, TEXAS
SCHEDULE OF REVENUE BOND COVERAGE DRAINAGE UTILITY BONDS – LAST TEN FISCAL YEARS
(Unaudited)
Table 13
132
Interest
Less Net and
Fiscal Total Operating Revenue Fiscal Coverage
Year Revenues (1)Expenses (2)Available Principal Charges Total Ratio
2010 700,827 457,376 243,451 210,000 8,400 218,400 1.11
2011 699,709 519,622 180,087 - - - n/a
2012 707,165 604,994 102,171 - - - n/a
2013 711,154 567,215 143,939 - - - n/a
2014 715,800 663,625 52,175 - - - n/a
2015 717,763 581,364 136,399 - - - n/a
2016 812,399 666,628 145,771 - - - n/a
2017 741,055 629,112 111,943 - - - n/a
2018 840,916 741,964 98,952 - - - n/a
2019 860,553 764,267 96,286 - - - n/a
Notes: (1) Operating and nonoperating revenues of drainage utility fund
(2) Total operating expenses of drainage utility fund exclusive of depreciation and amortization
CITY OF EULESS, TEXAS
DEMOGRAPHIC STATISTICS – LAST TEN FISCAL YEARS
(Unaudited)
Table 14
133
Personal
Per Income
Fiscal Estimated Capita (thousands Median School Unemployment
Year Population (1)Income (2)of dollars)Age (2)Enrollment (3)Rate (4)
2010 54,200 29,179$ 1,581,502$ 32.4 20,898 7.9%
2011 51,277 27,590$ 1,414,732$ 34.4 21,071 7.3%
2012 51,500 26,820$ 1,381,230$ 34.4 21,570 6.6%
2013 51,750 26,299$ 1,360,973$ 34.6 21,814 5.4%
2014 53,780 28,947$ 1,556,770$ 31.8 22,138 5.0%
2015 54,050 29,651$ 1,602,637$ 34.7 22,762 3.6%
2016 54,250 30,054$ 1,630,430$ 34.9 23,090 3.8%
2017 54,870 29,730$ 1,631,285$ 34.9 23,425 3.2%
2018 55,170 31,117$ 1,716,725$ 34.9 23,632 3.5%
2019 56,160 32,810$ 1,842,610$ 36.1 23,707 3.6%
Notes: (1) Estimates by North Central Texas Council of Governments
(2) Estimates by Claritas Site Reports; Research & Demographic Solutions; 2014 forward from US Census Bureau
(3) Hurst-Euless-Bedford Independent School District
(4) Texas Workforce Commission; Bureau of Labor Statistics
CITY OF EULESS, TEXAS
PRINCIPAL EMPLOYERS
CURRENT YEAR AND NINE YEARS AGO
(Unaudited)
Table 15
134
Percentage Percentage
of Total City of Total City
Employer Employees Employment Employer Employees Employment
LSG Sky Chefs, Inc.1,000 4.27%HEB ISD 818 3.45%
HEB ISD 861 3.61%LSG Sky Chefs, Inc.800 3.37%
City of Euless 390 1.67%City of Euless 358 1.51%
Target 250 1.07%Redi-Mix Concrete 355 1.50%
Lowe's 225 0.96%Autogrill Group, Inc.350 1.47%
Redi-Mix Concrete 190 0.81%Life Outreach International 181 0.76%
Life Outreach International 186 0.79%Super Target 150 0.63%
Dave and Buster's 150 0.64%Lowe's 125 0.53%
Lazy Dog 125 0.53%Home Depot 122 0.51%
Legend Oaks Healthcare 90 0.38%TJ Lambrecht Construction 20 0.51%
Total 3,467 14.73%3,279 14.23%
Source: City of Euless Planning and Development Department
2019 2010
CITY OF EULESS, TEXAS
FULL–TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION/PROGRAM – LAST TEN FISCAL YEARS
(Unaudited)
Table 16
135
Function/Program 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
General Government
and Administration 50.00 48.50 48.50 48.50 48.50 48.00 49.50 50.00 51.00 50.50
Public Safety 118.00 121.00 129.00 132.00 135.00 136.00 136.00 136.00 137.00 137.00
Fire Safety 71.00 71.00 72.00 72.00 72.00 72.00 72.00 75.00 75.00 75.00
Development Services 11.50 13.50 6.00 6.00 7.50 7.50 7.50 8.00 7.50 7.50
Culture and Recreational 30.00 31.00 32.00 30.50 33.25 34.25 34.25 35.25 35.25 35.25
Water and Wastewater 46.00 42.00 42.50 42.00 42.00 42.00 42.50 42.50 43.50 43.00
Golf Course 13.00 13.00 13.00 12.00 10.75 11.75 11.75 11.75 11.75 11.75
Public Works 14.00 17.50 18.50 18.50 18.50 20.00 20.00 21.00 22.50 23.50
Service Center 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00
Risk Management / Insurance 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50
Total 360.00 364.00 368.00 368.00 374.00 378.00 380.00 386.00 390.00 390.00
Source: City Budget Office
CITY OF EULESS, TEXAS
OPERATING INDICATORS BY FUNCTION/PROGRAM – LAST TEN FISCAL YEARS
(Unaudited)
Table 17
136
Function/Program 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Public Safety
Police
Number of Certified Officers 85 85 85 87 92 92 92 87 91 91
Number of Citations Issued 24,126 21,790 22,787 26,356 25,500 24,573 18,483 25,061 19,100 16,552
Fire
Number of Certified Firefighters 69 69 70 70 70 70 70 72 73 74
Number of Alarms 4,097 4,196 4,204 4,296 4,505 4,686 4,770 4,678 3,758 4,324
Number of EMS Calls 2,793 2,848 2,982 3,108 3,230 3,424 3,431 3,772 3,468 2,958
Municipal Court
Cases Filed 31,442 27,022 26,889 32,192 31,172 28,885 25,957 25,061 25,101 22,472
Development
Number Residential Inspections - New 101 52 44 42 107 176 186 176 214 93
Number Commercial Inspections - New 14 11 29 16 29 33 15 36 32 18
Number Multifamily Inspections - New 0 0 0 0 1 1 0 0 1 6
Public Works
Street Overlay (Square Footage)770,380 953,406 368,654 540,613 631,260 430,504 1,156,833 1,549,065 1,063,046 1,289,759
Cultural and Recreational
Parks and Recreation
Recreation Center Memberships 2,443 4,337 3,654 5,137 6,261 6,742 (1)6,975 6,528 7,183 7,125
Water and Wastewater
Number of Water Consumers 24,760 24,924 24,428 25,039 25,319 26,014 25,812 25,970 26,200 26,659
Water Produced (In Gallons x 1000)579,154 477,914 299,107 416,843 380,864 741,225 540,921 439,255 580,337 569,697
Water Purchased - TRA (In Gallons x 1000)2,028,760 2,566,370 2,440,539 2,133,211 2,154,469 1,628,651 1,787,547 1,766,692 1,767,677 1,586,667
Water Supplied (In Gallons x 1000)2,607,914 3,044,284 2,739,646 2,550,054 2,535,333 2,369,876 2,328,468 2,205,947 2,348,014 2,156,364
Annual Rainfall (In Inches)38.65 22.26 36.57 24.41 23.98 44.45 53.16 34.96 42.39 48.20
Golf Course
Number of Paid Rounds Played 32,996 35,075 34,550 35,890 22,110 (2)33,735 32,852 33,237 32,557 32,016
Source: City Departments
Comprehensive Annual Financial Report
City Budget Office
Notes:
(1) Amount restated to include recreation, aquatic and senior memberships.
(2) Golf course closed for 3½ months for renovations in 2014.
CITY OF EULESS, TEXAS
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM – LAST TEN FISCAL YEARS
(Unaudited)
Table 18
137
Function/Program 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Public Safety
Police Stations 1 1 1 1 1 1 1 1 1 1
Fire Stations 3 3 3 3 3 3 3 3 3 3
Public Works
Streets - Paved (1)217.6 332.1 332.4 333.36 340.62 342.8 344.77 350.12 350.12 351.74
Cultural and Recreational
Aquatic Facilities 3 3 3 4 3 3 3 3 3 3
Parks (2)16 16 16 16 16 16 16 16 16 16
Parks Land (Acres) (3)341 341 341 341 341 341 341 341 341 341
Other Facilities (Acres) (3)291 291 291 291 291 291 291 291 291 291
Community Buildings 5 6 6 6 6 6 6 6 6 6
Ampitheater 2 2 2 2 3 3 3 3 3 3
Conference Centre 1 1 1 1 1 1 1 1 1 1
Golf Course 1 1 1 1 1 1 1 1 1 1
Softball Facility (4)1 1 1 1 1 1 1 1 1 1
Athletic Fields 33 33 33 33 28 28 30 30 30 30
Library Holdings 106,121 110,149 111,230 111,312 105,500 98,596 101,160 85,123 80,241 81,353
Water and Wastewater
Water Mains - Potable (5)228.20 228.50 227.99 231.06 232.28 234.84 235.50 236.30 239.10 241.93
Water Mains - Reclaimed (5)- - - 1.73 3.22 3.70 3.82 3.96 4.12 7.15
Fire Hydrants 1,525 1,526 1,550 1,579 1,633 1,648 1,674 1,719 1,798 1,805
Wastewater Mains (5)186.5 186.7 187.6 187.6 191.3 192.4 193.2 195.2 197.0 198.4
Source: City Departments
(1) Fiscal years to 2010 are reported in linear miles. 2011 to current are reported in lane miles.
(2) Restated to exclude Softball Facility
(3) Restated to reflect Golf Course and Softball Facility land separately
(4) Added Softball Facility
(5) Miles of lines. Fiscal year 2012 figures have been restated to exclude approximately two miles of TRA lines that had been accidentally included as City lines.
138