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DALLAS COUNTY, TEXAS Comprehensive Annual Financial Report for the Fiscal Year Ended September 30, 2019

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DALLAS COUNTY, TEXAS Comprehensive Annual Financial Report for the Fiscal Year Ended September 30, 2019 COMPREHENSIVE ANNUAL FINANCIAL REPORT DALLAS COUNTY, TEXAS REPORT FOR THE YEAR ENDED SEPTEMBER 30, 2019 DALLAS COUNTY, TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2019 Prepared by: Darryl D. Thomas Office of County Auditor 1201 Elm Street, Suite 2300 Dallas, Texas 75270 DALLAS COUNTY, TEXAS Comprehensive Annual Financial Report For the Fiscal Year Ended September 30, 2019 TABLE OF CONTENTS Page INTRODUCTORY SECTION (Unaudited) Letter of Transmittal 1 GFOA Certificate of Achievement 6 Organizational Chart 7 List of Elected and Appointed Officials 8 FINANCIAL SECTION Independent Auditors’ Report 9 Management’s Discussion and Analysis 13 Basic Financial Statements: Government-wide Financial Statements: Statement of Net Position 26 Statement of Activities 27 Fund Financial Statements: Balance Sheet – Governmental Funds 28 Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds 29 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities 30 Statement of Net Position – Proprietary Fund 31 Statement of Revenues, Expenses and Changes in Fund Net Position - Proprietary Fund 32 Statement of Cash Flows – Proprietary Fund 33 Statement of Fiduciary Assets and Liabilities – All Agency Funds 34 Notes to the Basic Financial Statements 35 Required Supplementary Information: Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual – General Fund 100 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual – Major Projects Special Revenue Fund 102 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual – Major Grants Special Revenue Fund 103 Notes to Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual 104 Infrastructure Assets Under Modified Approach 106 Schedule of Changes in Net Pension Liability and Related Ratios – Primary Government 108 Schedule of Employer Pension Contributions – Primary Government 109 Schedule of Changes in Other Post Employment Benefit Liability – Primary Government 110 Schedule of Changes in Net Pension Liability and Related Ratios – Discretely Presented Component Unit 111 Schedule of Employer Pension Contributions – Discretely Presented Component Unit 112 i DALLAS COUNTY, TEXAS Comprehensive Annual Financial Report For the Fiscal Year Ended September 30, 2019 TABLE OF CONTENTS Page Supplementary Information Combining and Individual Funds Statements and Schedules: Combining Balance Sheet – Non-Major Governmental Funds 117 Combining Statement of Revenues, Expenditures and Changes in 120 Fund Balances – Non-Major Governmental Funds Schedules of Revenues, Expenditures, and Changes in Fund Balances Budget and Actual: Debt Service Fund – County-Wide Fund 123 Non-Major Special Revenue Funds 124 Combining Statement of Fiduciary Assets and Liabilities – All Agency Funds 134 Combining Statement of Changes in Fiduciary Assets and Liabilities – All Agency Funds 136 STATISTICAL SECTION (Unaudited) Net Position of Primary Government 148 Changes in Net Position 149 Governmental Activities Tax Revenues by Source 150 Fund Balances of Governmental Funds 151 Changes in Fund Balances of Governmental Funds 152 Assessed Value and Estimated Actual Value of Taxable Property 153 Property Tax Rates and Tax Levies 154 Property Tax Rates – Direct and Overlapping Governments 155 Principal Property Taxpayers 156 Property Tax Levies and Collections 157 Ratios of Outstanding Debt 158 Computation of Direct and Overlapping Bonded Debt 159 Legal Debt Margin – Primary Government 161 Pledged Revenue Coverage 162 Demographic and Economic Statistics 163 Principal Employers 164 Full-time Equivalent County Government Employees by Function 165 Operating Indicators by Function 166 Capital Asset Statistics by Function 167 ii INTRODUCTORY SECTION (Unaudited) DALLAS COUNTY DARRYL D. THOMAS COUNTY AUDITOR March 31, 2020 Honorable District Judges of Dallas County and Honorable Members of the Dallas County Commissioners Court: State law, V.T.C.A. Local Government Code 114.025 and 115.045, requires issuance of an annual financial report and an annual independent audit of all matters relating to fiscal affairs of the County. Pursuant to those requirements, we hereby release the comprehensive annual financial report of the County of Dallas for the fiscal year ended September 30, 2019. This report consists of management’s representations concerning the finances of the County. Consequently, management assumes full responsibility for the completeness and reliability of all of the information presented in this report. To provide a reasonable basis for making these representations, the County has established a comprehensive internal control framework that is designed both to protect the County’s assets from loss, theft, or misuse, and to compile sufficient reliable information for the preparation of the basic financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP). Accounting requirements for Governmental Accounting Standards Board (GASB) Statement Numbers 83 and 88 were implemented in FY19. Only GASB 88 impacted the County. These statements are explained in the Notes to the Basic Financial Statements. Because the cost of internal controls should not outweigh their benefits, the County’s comprehensive framework of internal controls has been designed to provide reasonable, rather than absolute, assurance that the basic financial statements will be free from material misstatement. Responsibility for internal controls is shared by Commissioners Court, which is the governing body; the County Auditor, (appointed by the District Judges); the Office of Budget and Evaluation (appointed by Commissioners Court); and, the County Treasurer (an elected position). We believe that the County’s internal accounting controls adequately safeguard assets and provide reasonable assurance of proper recording of financial transactions. We assert that, to the best of our knowledge and belief, this financial report is complete and reliable in all material respects. The County’s basic financial statements have been audited by Deloitte & Touche, LLP. The goal of the independent audit was to provide reasonable assurance that the basic financial statements of the County, 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 basic financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall financial statement presentation. The independent auditors’ report is presented as the first component of the financial section of this report. Generally accepted accounting principles require a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). The introduction includes this transmittal letter, the County’s organizational chart and a list of principal officials. This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The financial section also includes government-wide financial statements, fund financial statements, notes to the financial statements, required supplementary information and the combining and individual fund financial statements and schedules in addition to the report of the independent auditors on the financial statements. The statistical section of this 1 report includes selected financial and demographic information, which is generally presented on a multi-year basis. PROFILE OF DALLAS COUNTY The County is located in north central Texas, and is strategically central to the economic region of Texas, Louisiana, Arkansas, Oklahoma, and New Mexico, as well as centrally located within the United States. The County region was opened for settlement by the Mexican colonization laws and was included in an impresario grant before 1836, but actual settlement was delayed until 1841. The first Texas legislature created the County from parts of Robertson and Nacogdoches counties on March 30, 1846, and designated the town of Dallas (a post office since 1844) as a temporary “Seat of Justice.” The act does not state whom the County’s name honors; it probably was George M. Dallas, then vice president of the United States. Two elections were held in 1850 to fix the city of Dallas as the permanent county seat. The County encompasses an area of 900 square miles. Dallas County is the ninth largest county in the U.S. The 2010 census reported population for the County at 2,368,139. The Census Bureau has estimated the population has increased approximately 11.4%. The County is a public corporation and political subdivision of the State of Texas. The general governing body of the County is the elected five-member Commissioners Court in accordance with Article 5, Paragraph 18 of the Texas Constitution. Commissioners serve four-year staggered terms, two members elected every two years. The County Judge is elected at large to serve a four-year term. The Commissioners Court sets County tax rates, establishes policies for County operations, approves contracts for the County and develops and adopts the County budget within the resources estimated by the County Auditor. The Commissioners Court is also responsible for development of policies
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