City of Missouri City, Texas
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City of Missouri City, Texas COMPREHENSIVE ANNUAL FINANCIAL REPORT For the Fiscal Year Ended June 30, 2014 Edward Broussard, City Manager Prepared by: Wes Vela, Director of Finance Michael Higgins, Assistant Finance Director City of Missouri City, Texas COMPREHENSIVE ANNUAL FINANCIAL REPORT Year Ended June 30, 2014 TABLE OF CONTENTS Exhibit Page INTRODUCTORY SECTION Letter of Transmittal i-xiv GFOA Certificate of Achievement xv Organizational Chart xvi List of Principal Officials xvii-xix FINANCIAL SECTION Independent Auditors’ Report 1-2 Management’s Discussion and Analysis 4-13 Basic Financial Statements: Government-Wide Financial Statements: Statement of Net Position A-1 17 Statement of Activities A-2 18-19 Fund Financial Statements: Balance Sheet - Governmental Funds A-3 20 Statement of Revenues, Expenditures, and Changes in Fund Balance - Governmental Funds A-4 21 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities A-5 22 Statement of Net Position - Proprietary Funds A-6 23 Statement of Revenues, Expenses and Changes in Fund Net Position - Proprietary Funds A-7 24 Statement of Cash Flows - Proprietary Funds A-8 25-26 Notes to the Financial Statements A-9 28-64 Required Supplementary Information: General Fund - Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual B-1 66 Notes to Required Supplementary Information B-2 67-69 Texas Municipal Retirement System - Schedule of Funding Progress B-3 70 City of Missouri City, Texas COMPREHENSIVE ANNUAL FINANCIAL REPORT Year Ended June 30, 2014 TABLE OF CONTENTS Exhibit Page Combining and Individual Fund Statements and Schedules: Combining Statements – Non-major Governmental Funds: Combining Balance Sheet C-1 74-77 Combining Statement of Revenues, Expenditures and Changes in Fund Balance C-2 78-81 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual: Parkland Dedication Fund C-3 82 Law Enforcement Fund C-4 83 Radio Communications Fund C-5 84 Court Security Fee Fund C-6 85 Court Technology Fee Fund C-7 86 Missouri City TV Facility & Equipment Fund C-8 87 Court Juvenile Case Fund C-9 88 Grants Fund C-10 89 Donations Fund C-11 90 Community Development Block Grant Fund C-12 91 Tax Increment Reinvestment Zone #1 Fund C-13 92 Tax Increment Reinvestment Zone #2 Fund C-14 93 Tax Increment Reinvestment Zone #3 Fund C-15 94 Development Authority Fund C-16 95 Public Improvement District #2 Fund C-17 96 Public Improvement District #4 Fund C-18 97 Metro Fund C-19 98 Certificates of Obligation Fund C-20 99 Debt Service Fund C-21 100 Internal Service Funds: Combining Statement of Net Position C-22 101 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position C-23 102 Combining Statement of Cash Flows C-24 103 City of Missouri City, Texas COMPREHENSIVE ANNUAL FINANCIAL REPORT Year Ended June 30, 2014 TABLE OF CONTENTS STATISTICAL SECTION Table Page Net Position by Component 1 106-107 Changes in Net Position 2 108-111 Fund Balances of Governmental Funds 3 112-113 Changes in Fund Balances of Governmental Funds 4 114-115 Assessed Value and Estimated Value of Taxable Property 5 117 Property Tax Rates - Direct and Overlapping Governments 6 118-119 Principal Property Taxpayers 7 120 Property Tax Levies and Collections 8 121 Ratios of Outstanding Debt by Type 9 122 Ratio of Net General Bonded Debt Outstanding 10 123 Direct and Overlapping Governmental Activities Debt 11 125 Legal Debt Margin Information 12 126-127 Demographic and Economic Statistics 13 128 Principal Employers 14 129 Full-time Equivalent City Governmental Employees by Function 15 130-131 Operating Indicators by Function 16 132-133 Capital Assets Statistics by Function 17 134-135 (This Page Intentionally Left Blank) December 18, 2014 To the Honorable Mayor, Members of the City Council, and Citizens of the City of Missouri City, Texas: We are pleased to submit to you the Comprehensive Annual Financial Report of the City of Missouri City, Texas, for the fiscal year ended June 30, 2014. This report is published to provide the City Council, City staff, our citizens, our bondholders, and other interested parties with detailed information concerning the financial condition and activities of the City. Responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosure, rests with the City. We believe the data, as presented, is accurate in all material respects and that it is presented in a manner designed to fairly set forth the financial position and results of operations of the City as measured by the financial activity of its government-wide financial statements and its various funds, and that all disclosures necessary to enable the reader to gain the maximum understanding of the City’s financial activity have been included. Whitley Penn, Certified Public Accountants, has issued an unmodified (“clean”) opinion on the City of Missouri City’s financial statements for the year ended June 30, 2014. The independent auditor’s report is located in the front of the financial section of this report. Management’s discussion and analysis (MD&A) immediately follows the independent auditor’s report and provides a narrative introduction, overview, and analysis of the basic financial statements. MD&A complements this letter of transmittal and should be read in conjunction with it. MISSION STATEMENT AND ORGANIZATIONAL GOALS The City’s mission statement is “To provide the Citizens of Missouri City with quality service and efficient use of resources.” The City’s overall goal statement is shown below: A city that has grown to maturity and continues to be a desirable place: to live, because of the existence of a wide range of housing types located in safe, well- kept neighborhoods which receive a full range of services and supporting infrastructure; to work, because of the existence of office and light manufacturing, industry, and business offering a variety of job opportunities; to play, because of the existence of a wide range of leisure time activities, both public and private; and to shop, because of the existence of adequate and attractive retail areas. i The City Council and the City Staff shall: 1. Perform with concern for the health, safety and well-being of our citizens and always consider how our actions affect citizens. 2. Reflect a positive image. 3. Establish good/sound financial planning. 4. Strive to develop Missouri City within parameters of the Comprehensive Plan. 5. Work toward the equitable distribution of City resources. LOCAL ECONOMY Missouri City is located approximately 20 miles southwest of downtown Houston, in northeast Fort Bend County. A small portion of the City extends into the southwestern section of Harris County, where its boundaries adjoin the City of Houston. Approximately 10 percent of the City’s population resides in Harris County. A number of toll roads and highway expansions, including Highway 90A, Texas State Highway 6, and the Fort Bend Tollway, allow for more improved travel times throughout the region. According to the Greater Fort Bend County Economic Development Council’s Annual Report for Fiscal Year 2014, Fort Bend County’s population is estimated at 652,365 which is a 4% increase over 2013. The County’s labor force was 330,255 at June 30, 2014, while Missouri City’s labor force was 39,668 (12% of the county). With an increase in local and regional business activity, the unemployment in Fort Bend County was 5.0 percent as compared to the state average of 5.5 percent and national average of 6.5 percent. Fort Bend County has the No. 1 fastest growing county of the ten largest counties in Texas, and is consistently ranked in the top 3% of the nation's counties in 5 key demographic measures. While many governmental entities around the nation, state and region are working to keep their bottom lines strong in a slowly recovering economy, the City of Missouri City has seen more stable trends. Property tax income increased 12 percent in FY14, sales taxes increased 8 percent and franchise fees were up 15 percent. The last few budget years have presented challenges for Missouri City similar to most other cities. We have been finding alternative solutions to becoming less reliant on property taxes, and we will continue to craft strategic plans as a recovery continues to take place. “SHOW ME” SUCCESS Missouri City has achieved significant successes in FY2014 as the Great Recession sits in its rear view mirror. Economic and residential growth has been part of the City’s story the past five to ten years, and all signs point to continued growth in the future. New industries continue to find a home here, producing goods and services in Missouri City for the world. In the past five years, Missouri City’s commercial tax base has grown 25 percent as the City continues to expand its commercial square footage to not only diversify the property tax base but to provide jobs for the citizens. In the past three years, more than 1,100 jobs, 600 of them non- retail, have been added to the City’s workforce and commercial square footage has increased by 3.3 million. The Lakeview Business Park and the Beltway Crossing Complex are attractive locations for national and international respected companies. ii “SHOW ME” THE FUTURE As the economy is expected to improve ever so slightly, the Missouri City community anticipates a better year. A stable economy in the upcoming year will allow the City to stay on track with the capital improvement projects and to build and maintain staffing levels. In collaboration with our citizens and staff, the City Council is committed to maintaining the community at the level of a Top 100 American City.