R-2018-5203 - 2/22/2018 RESOLUTION NO. R-2018-5203
WHEREAS,the City of Round Rock's Comprehensive Annual Financial Report("Report")for the
fiscal year ended September 30, 2017 has been submitted to the City Council, and
WHEREAS, the City Council desires to acknowledge the receipt and acceptance of the attached
Report,Now Therefore
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS,
That the City of Round Rock's Comprehensive Annual Financial Report for the fiscal year ended
September 30, 2017, attached hereto as Exhibit "A" and incorporated herein, is hereby received and
accepted.
The City Council hereby finds and declares that written notice of the date,hour,place and subject
of the meeting at which this Resolution was adopted was posted and that such meeting was open to the
public as required by law at all times during which this Resolution and the subject matter hereof were
discussed, considered and formally acted upon, all as required by the Open Meetings Act, Chapter 551,
Texas Government Code, as amended.
RESOLVED this 22nd day of February, 2018.
CRA6 MOR �Vc
, Mayor
City of Round , Texas
ATTEST:
SARA L. WHITE, City Clerk
0112.1804;00395291
No Text
EXHIBIT
„A»
s
ROUND ROCK TEXAS
City of Round Rock, Texas
Comprehensive Annual Financial Report
Fiscal Year Ended September 30, 2017
ELECTED OFFICIALS
Craig Morgan, Mayor
Will Peckham, Mayor Pro Tem
Tammy Young, Council Member
Rene Flores, Council Member
Frank Leffingwell, Council Member
Writ Baese, Council Member
Kris Whitfceld, Council Member (through September 2017)
Hilda Montgomery, Council Member (elected December 2017)
MANAGEMENT STAFF
Laurie Hadley
City Manager
Bryan Williams
Assistant City Manager
Brooks Bennett
Assistant City Manager
OFFICIAL ISSUING REPORT
Susan L. Morgan, CPA
Chief Financial Officer
•
004 0
v�llllf �*��*�A�Iff�"+FM�~~�* wl�►��
��` TT
TABLE OF CONTENTS
INTRODUCTORY SECTION:
Letter of Transmittal 3
City Organizational Chart 13
Certificate of Achievement for Excellence in Financial Reporting 14
FINANCIAL SECTION:
Independent Auditors' Report 17
Management's Discussion and Analysis 21
Basic Financial Statements
Government-Wide Financial Statements:
Statement of Net Position 34
Statement of Activities 36
Fund Financial Statements:
Governmental Funds:
Balance Sheet 38
Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Position 41
Statement of Revenues, Expenditures and Changes in
Fund Balances 42
Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances of Governmental Funds
to the Statement of Activities 44
Statement of Revenues,Expenditures and Changes in Fund Balance-
Budget and Actual—General Fund 45
Statement of Revenues, Expenditures and Changes in Fund Balance-
Budget and Actual—Round Rock Transportation and Economic
Development Corporation Fund 46
Proprietary Funds:
Statement of Net Position 48
Statement of Revenues, Expenses and Changes in Net Position 50
Statement of Cash Flows 51
Notes to the Financial Statements 55
Required Supplementary Information
Schedule of Funding Progress 103
Schedule of Changes in the Net Pension Liability and Related Ratios 104
Schedule of Contributions 105
TABLE OF CONTENTS
Combining and Individual Fund Statements and Schedules
Nonmajor Governmental Funds:
Combining Balance Sheet-Nonmajor Governmental Funds 107
Combining Statement of Revenues, Expenditures and Changes in
Fund Balance—Nonmajor Governmental Funds 108
Combining Balance Sheet—Nonmajor Special Revenue Funds 110
Combining Statement of Revenues, Expenditures and Changes in Fund Balances—
Nonmaj or Special Revenue Funds 112
Combining Balance Sheet—Nonmajor Capital Projects Funds 116
Combining Statement of Revenues,Expenditures and Changes in Fund Balances—
Nonmajor Capital Projects Funds 118
Schedules of Revenues,Expenditures and Changes in Fund Balances—
Budget and Actual:
General Fund 122
Debt Service Fund 126
Nonmajor Special Revenue Funds:
Community Development Block Grant 127
Hotel-Motel Occupancy Tax 128
Hotel-Motel Occupancy Venue Tax 129
Landscape 130
Library 131
Multipurpose Sports Complex 132
Municipal Court 133
Police 134
Public Education&Government 135
Traffic Safety Program 136
Supplemental Schedules:
Schedule of Capital Assets for Governmental Activities 138
TABLE OF CONTENTS
STATISTICAL SECTION(UNAUDITED):
Financial Trends:
Net position by Component—Last Ten Fiscal Years 142
Changes in Net position—Last Ten Fiscal Years 144
Fund Balances of Governmental Funds—Last Ten Fiscal Years 148
Changes in Fund Balances of Governmental Funds—Last Ten Fiscal Years 150
Revenue Capacity:
Actual and Taxable Assessed Value of Property—Last Ten Fiscal Years 152
Property Tax Rates—Direct and Overlapping Governments
Per$ 100 of Assessed Value—Last Ten Fiscal Years 153
Principal Property Taxpayers—Current Year and Nine Years Ago 154
Property Tax Levies and Collections—Last Ten Fiscal Years 155
Sales Tax and Ad Valorem Tax—Last Ten Fiscal Years 156
Taxable Sales by Category—Last Ten Calendar Years 158
Hotel Taxpayers 160
Hotel Occupancy Tax Collection History by Quarter—Last Ten Fiscal Years 161
Debt Capacity:
Ratios of Outstanding Debt by Type—Last Ten Fiscal Years 162
Ratios of Net General Bonded Debt Outstanding to Assessed Value and Net
Bonded Debt Per Capita—Last Ten Fiscal Years 163
Computation of Direct and Overlapping Bonded Debt 165
Legal Debt Margin Information—Last Ten Fiscal Years 166
Condensed Utility Statement of Operations—Last Ten Fiscal Years 168
Demographic and Economic Information:
Demographic and Economic Statistics—Last Ten Fiscal Years 171
Principal Employers—Current Year and Nine Years Ago 172
Operating Information:
Full-Time Equivalent City Government Employees by Function—Last
Ten Fiscal Years 173
Operating Indicators by Function—Last Ten Fiscal Years 174
Capital Asset Statistics by Function—Last Ten Fiscal Years 176
Top Ten Water Customers 178
Water and Sewer Retail Rates 179
TABLE OF CONTENTS
SINGLE AUDIT SECTION:
Schedule of Expenditures of Federal Awards 183
Notes to Schedule of Expenditures of Federal Awards 184
Independent Auditors' Report on Internal Control Over Financial
Reporting and on Compliance and Other Matters Based
on an Audit of Financial Statements Performed in Accordance
with Government Auditing Standards 185
Independent Auditors' Report on Compliance for Each Major Program and
on Internal Control Over Compliance Required by the Uniform Guidance 187
Schedule of Findings and Questioned Costs 189
INTRODUCTORY
SECTION
- s I
. s
.M
2
—_dill
oftr"W"l—
Mayor Councillmembers City Manager
Craig Mi.)rgan T(irnrny YOUng Laurie Halley
Rene Flores
ROUND ROCK TEXAS Mayor Pro-Tern Frank Lef fingwell
1::�MI�57 A"Tic)
Writ Baese City Attorney
AriMINISTRATION DEPARTMENT Will Peckharn Hilda Montgomery Stephan L.Sheets
February 2,2018
Honorable Mayor and Members of the
City Council
City of Round Rock, Texas
The Comprehensive Annual Financial Report of the City of Round Rock, Texas for the fiscal year ended
September 30, 2017, is submitted herewith. This report has been prepared by the City's Finance
Department and responsibility for both the accuracy of the presented data and the completeness and fairness
of the presentation, including all disclosures, rests with the City. We believe the data is accurate in all
material aspects and is presented in a manner designed to clearly state the financial position and results of
operations of the City as measured by the financial activity of its various funds. All disclosures have been
included to enable the reader to gain the maximum understanding of the City's financial affairs.
The City Charter requires an annual audit of the books of account,financial records and transactions of all
departments of the City by independent certified public accountants selected by the City Council.
Whitley Penn, L.L.P., Certified Public Accountants, have issued an unmodified ("clean") opinion on the
City of Round Rock's financial statements for the year ended September 30, 2017. The independent
auditors' report is located at the front of the financial section of this report.
Management's discussion and analysis (MD&A) can be found immediately following the report of the
independent auditors. The MD&A is a narrative introduction, overview and analysis to accompany the
basic financial statements. This letter of transmittal is designed to complement the MD&A and should be
read in conjunction with it.
City of Round Rock Profile
The City of Round Rock, established in 1851, is a municipal corporation incorporated under Article XI,
Section 5 of the Constitution of the State of Texas (Home Rule Amendment). The City operates under a
Council-Manager form of government with six council members and a mayor. The City Manager is
appointed by the City Council and is responsible to them for managing and administering all City affairs.
The Chief Financial Officer is appointed by the City Manager and is responsible for supervising the
operations of the Finance Department. This department maintains all accounting records of the City.
The financial reporting entity(the government)includes all the funds of the primary government(the City
of Round Rock as legally defined) as well as its component units. Component units are legally separate
entities for which the primary government is financially accountable. The City provides a full range of
services which include police and fire protection, parks and library, construction and maintenance of
infrastructure, planning and community development, convention and tourism activities, and general
administrative services. In addition,the City owns and operates a water,sewer and drainage utility system.
These activities are included in the accompanying financial statements.
3
CITY OF ROUND ROCK 221 East Main Street,Round lock, Texas 78664
[P]512.2 1 18.5401 - [F]512.218.7097 - roundracktexas.gov
Blended component units, although legally separate entities, are in substance part of the primary
government's operations and included as part of the primary government. Accordingly, Round Rock
Transportation and Economic Development Corporation revenues are reported in a special revenue fund of
the City.
Annual budgets are legally adopted for the General Fund, Special Revenue Funds,Debt Service Fund, and
the Proprietary Funds. Capital Projects Funds have no binding annual budget. Project-length financial
plans are adopted for all capital projects;accordingly,no comparison of budget to actual is presented in the
financial statements.
Budgetary control is maintained at the department level by the encumbrance of estimated purchase amounts
prior to the release of purchase orders to vendors. Purchase orders which result in an overrun of balances
are not released until additional appropriations are made available. The City had no material operating
encumbrances as of September 30,2017.
Significant Local Economic Events
Strategic Goals
The City of Round Rock is the largest City within Williamson County and is adjacent to the City of Austin.
The City has experienced tremendous population growth which has led to an increased demand for city
services. To adequately prepare for the effect of this activity on the City, much effort goes into planning
and funding infrastructure and service programs. Each February, Council reviews the City's successes and
challenges and refines both the short-term and long-term strategic goals for the City. These goals set the
direction for the allocation of staff and financial resources and are the basis for the development of the
following year's budget.
ROUND s ROCK
Financially Sound City Infrastructure for "The Sports Capital of
City Providing High Today and Tomorrow Texas"for Tourism &
Value Services Residents
i
i
'YEA
MYIr
Great Community Sustainable Authentic Downtown-
to Live Neighborhoods Exciting Community
Destination
4
Economy
Round Rock continues to see strong population and economic growth. As the largest city in Williamson
County and part of the Austin Metropolitan Statistical Area(MSA),Round Rock is a key city in one of the
fastest growing regions across the nation. From 2009 to the projected population for 2018, the City of
Round Rock has experienced population growth of almost 12% over the past 10 years. Long-range
population estimates from the City's Planning and Development Services Department predict this increase
continuing at a growth rate of between 2% and 3% per year for the foreseeable future. The City's current
population is an estimated 108,353.
The population for 2030 is projected to be over 158,000 within the City limits and over 215,000 in Greater
Round Rock, which includes the City limits and the City's extraterritorial jurisdiction (ETJ). While most
of the long-range growth will likely occur in northeast Round Rock where there are still large tracts of land
that could be developed into additional neighborhoods, population density will likely increase across the
City as residential development continues for single family townhomes,multifamily apartments,and senior
living facilities. The City is planning and preparing for this population growth to ensure the high-quality
services Round Rock residents have come to expect are expanded to serve residents of today and of
tomorrow.
A leading driver of the City's population growth is a strong local economy.The City's unemployment rate
is 3.2%, remaining lower than the Austin MSA rate of 3.3%and the statewide rate of 4.1%. As the Texas
economy faces some uncertainties due to unstable oil prices and the aftermath of Hurricane Harvey, the
Central Texas area's geographic and economic distance from the oil industry and the recovery Coastal
region has and will likely continue to insulate the region from major impacts. Round Rock businesses have
seen continued growth in revenues, especially in the hotel and restaurant industries, as more tourists and
visitors come to enjoy Round Rock's "Sports Capital of Texas" sporting events, historic downtown, and
unique blend of destination shopping experiences.
Round Rock continues to gain recognition for the value of the high-quality services provided to our
residents. Below are a few of our most recent accolades:
• Ranked number 5 by Niche.com as one of the"2017 Safest Cities in the Country"
• Ranked number 3 by LendEDU as one of the"Best Cities to Start a Family"
• Ranked number 12 by Bankrate.com as one of the"Best Cities to Retire"
• Ranked number 8 by WalletHub among mid-size cities for the"Fastest Economic Growth"
• Ranked number 2 by SmartAsset.com as one of the"Best Minor League Baseball Towns of 2017"
• Ranked number 8 by SmartAsset.com as one of the"Best Cities for Living the American Dream"
The local hotel/motel industry continues to be a particularly vibrant industry for Round Rock. The City
had 3,000 hotel and motel rooms at the end of fiscal year 2017. Occupancy rates remain among the highest
in the state at 77%. This strong industry bodes well for the hotel occupancy tax collections which support
local tourism events and debt service for the Dell Diamond/Convention Center, the home of the "Round
Rock Express" Triple A Baseball team and the Round Rock Sports Center, the City's 82,800 square foot
indoor sports venue which opened in January 2014. The City's new $27 million tournament class outdoor
multipurpose sports complex opened on May 18, 2017. This complex attracts major sporting tournaments
such as soccer and other field sports and events from across the country. With several area sports facilities
in place and statewide events being planned, Round Rock continues its marketing strategy as the "Sports
Capital of Texas." Tourism is an important component of the City's overall economic development
strategy.
5
Economic Development
The City understands that diversification of Round Rock's economy is a key to financial stability. The
local retail market place continues to thrive. The major destination retail hubs provide continued expansion
and broaden Round Rock's economy. The Round Rock Premium Outlets celebrated its 10'anniversary in
August 2016. The 430,000-square foot outlet mall serves as a destination for shoppers from Central Texas
and beyond. The Round Rock IKEA celebrated its 10°i anniversary in November 2016. Over the past 10
years IKEA has brought in over 18 million shoppers to the City from Texas, Mexico, and beyond. IKEA
has diversified the City's economy and brought in millions of dollars in sales tax revenues. Round Rock
Premium Outlets, IKEA, and similar destination-based retail stores like Bass Pro Shops which opened in
2015 were intentionally sought out by the City's economic development program to locate in Round Rock.
These stores generate sales tax revenues for the City, bring in shoppers to the area which benefits
neighboring retail and restaurants, and place a relatively low demand on City services such as police, fire,
and parks and recreation. While traditional brick and mortar retail continues to see declines, destination
shopping,both in Round Rock and across the nation, continues to thrive.
Dell Technologies continues to be the largest employer in Round Rock with an estimated 12,000 employees
in 2017 and is a major driver of the City's economy. Since Dell relocated to Round Rock in 1994, the
economic impact to the City has been transformative.Dell remains the City's largest sales tax payer,though
sales tax revenues attributed to Dell's sales have decreased over time as the company has shifted away from
the manufacture of goods and has focused more on services. Because of the company's commitment to
Round Rock, the employment opportunities they offer, and the property tax and sales tax revenues they
generate,Dell remains vital to the City's economy.
As retail stores and shopping centers across Round Rock continue to age, the City is realizing the
importance of supporting and enabling redevelopment of its retail infrastructure. There is funding in the
fiscal year 2018 budget for the City to partner with the Round Rock Chamber of Commerce for a business
and retail redevelopment study to identify and implement strategies to keep these businesses vital. As part
of this strategy, the City has reorganized and established a new business and neighborhood development
division to focus on keeping its commercial and residential areas strong.
The long-standing partnership between the City and Round Rock Chamber of Commerce continues to
attract new development to the City. The funding is leveraged with the Chamber of Commerce Momentum
funding to create a public/private partnership for economic development priorities. This partnership
continues to yield a new, inspired approach to economic development for Round Rock. The City will see
new additions within the city limits in the next year.
Round Rock's economy has become stronger and more diverse because of a variety of business relocations
bringing capital investment, job opportunities, and new residents to the City. Emerson Process
Management opened its$70 million,282,000-square foot international headquarters and technology center
in January 2014 for its automation systems and project services businesses which help customers operate
facilities in .fields like oil and gas. TECO-Westinghouse, which has their large manufacturing plant in the
City, is the largest manufacturer of electric motors in North America. Houghton Mifflin Harcourt(HMH)
relocated its Texas regional office to Round Rock in July 2016. Their relocation brought over 270 jobs to
the City and they now anchor a brand new 100,000-square foot Class A office building in La Frontera.
South University built a 42,000-square foot campus, also in La Frontera, when they relocated from Austin
in early 2015. ProPortion Foods LLC,a Los Angeles-based food service company relocated its office,food
processing,storage,and warehouse facility to the City in 2016,bringing in at least 400 full-time jobs.Airco
Mechanical, a commercial and residential heating, ventilation, and air conditioning service provider, has
relocated its Central Texas headquarters to a previous vacant 47,000-square foot building, bringing in
another 400 full-time jobs.
6
These economic development wins of the past will continue to add to the diversity of Round Rock's
economy into the future as several companies have recently announced plans to locate in the City. A new
Embassy Suites Hotel and Conference Center is planned to be built for $20 million on approximately 6
acres of land near Bass Pro Shops and Round Rock Premium Outlets. The project will bring a 160-room
hotel with at least 14,000-square feet of convention and meeting space and will generate at least 60 jobs.
The hotel and conference center is anticipated to open in 2020.
Mesa Creek, a 60,000-square foot Class A office building is being built on a 16-acre plot on Old Settlers
Boulevard near Mesa Drive. The project helps ease a shortage of office space in the City and will bring in
over 50 j obs.The groundbreaking for the project was held on May 24,2017 with completion scheduled for
early 2018.
United Parcel Service (UPS) announced they will be the next Fortune 500 company to expand in Round
Rock with a new regional distribution center that will provide additional operating capacity for the Austin
area. The $70 million facility,projected to open in 2018, will be 225,000-square feet located on fifty acres
of land near SH 45 and A.W. Grimes Boulevard. The new distribution center will employ more than 300
people.
Kalahari Resorts has chosen Round Rock as the location of its fourth family resort and convention center.
The City views this partnership as a game-changer for the community. Its proximity to Old Settlers Park
and Dell Diamond—two well-established venues that draw more than a million visitors annually—bodes
well for a successful,tourism-oriented development. The convention and resort business is a new industry
for Round Rock that will provide substantial property tax revenues and diversify the local economy and
available employment opportunities. The proposed project is under design and will feature a minimum of
975 guest rooms, a 150,000-square foot convention center, a 200,000-square foot indoor/outdoor water
park, restaurants,retail, and other indoor and outdoor activities.
Mark IV Capital finalized a memorandum of understanding with the City in November 2017 to build a
master-planned, mixed-use development in south Round Rock. The development,named The District,will
be located on 65 acres with an estimated capital investment of$200 million to build 1 million-square feet
of Class A office, commercial, and residential space. This mixed-use development, with hundreds of
thousands of square-feet of Class A office space, will be a great opportunity for continued growth and
diversification of the City's economy.
Round Rock continues to see significant growth in the medical industry. The City is home to several
hospitals offering comprehensive world-class healthcare services. These hospitals continue to expand their
facilities and services to keep up with Round Rock's growing population. Baylor Scott & White Health
opened a new 39,000-square foot cancer care facility on its medical center campus in September 2017.The
facility offers a comprehensive approach to cancer treatment and houses numerous departments and
services including medical and neurological oncology, radiologists, pain management specialists, social
workers, physical therapy,occupational therapy, palliative care, and more.
To complement the healthcare and medical facilities, Round Rock is home to several higher education
facilities, many of which focus on healthcare disciplines. These institutions of higher learning include the
Texas A&M Health Science Center, Texas State University, Austin Community College, and the Art
Institute of Austin. Texas State University is undergoing construction of a new $70 million building on
their Round Rock campus which, when complete in 2018, will house their College of Health Professions.
7
Relevant Financial Policies
Accounting System and Controls
The City Council approved a change to the General Fund Reserve policy to lower the reserve requirement
from 33%to 25%of operating expenditure. The City is not as dependent on volatile sales tax revenues as
it once was. Beginning with the fiscal year 2018 budget, the reserve will be lowered over 2 to 3 years to
gradually transition to the new balance and will continue to maintain a conservative reserve against future
risk. The City's Concentration Risk Fund, a separate account to provide additional surety on the City's
highest sales tax remitters,remains in place. Working capital in the Water/Wastewater Utility Fund is also
maintained at 33% of operating expenditures. Balances in excess of the above levels are earmarked for
future uses or reduced to the target levels over an appropriate length of time.
In developing and evaluating the City's accounting system, consideration is given to the adequacy of
internal accounting controls. Internal accounting controls are designed to provide reasonable, but not
absolute, assurance regarding: (1) the safeguarding of assets against loss from unauthorized use or
disposition and (2) the reliability of financial records for preparing financial statements and maintaining
accountability for assets. The concept of reasonable assurance recognizes that: (1) the cost of a control
should not exceed the benefits likely to be derived and (2) the evaluation of costs and benefits requires
estimates and judgments by management.
All internal control evaluations occur within the above framework. We believe that the City's internal
accounting controls adequately safeguard assets and provide reasonable assurance of proper recording of
financial transactions.
Long-Term Financial Planning
The City uses a 5-year planning model for the General Fund which projects revenues and expenditures over
a long-term period using assumptions about economic conditions and future spending scenarios.This model
is developed internally and focuses on the anticipated future funding necessary to meet the City's strategic
goals.
The model takes a comprehensive approach to evaluating the long-term needs for property tax rates and
other revenues to provide for the maintenance and operations of the General Fund. The City's General
Fund relies heavily on sales tax as a revenue source. The sales tax is a less stable revenue source than the
property tax but provides the taxpayers with more discretion and a lower property tax rate. Because of this
revenue makeup, the City estimates sales tax revenues conservatively and introduces new programs
somewhat more cautiously until projected revenue levels are attained. The City is also more attentive to
the health of its economy because of the reliance upon commerce to produce the sales tax.
The City's economy is expected to generate approximately$64.3 million in sales tax revenue for fiscal year
2018, net of sales tax rebates paid to Dell, Sears and Bass Pro Shops in accordance with economic
development agreements in effect. This amount includes the 1/2%or$17.3 million in additional sales and
use tax for roads and economic development. The remaining 1 1/2%is projected to generate$47.0 million
for general operations, property tax reduction and capital projects.
In 2016, Dell, the City's largest employer and taxpayer, completed its acquisition of EMC Corporation.
This acquisition transformed Dell into a major player in the data storage, information security,
virtualization,analytics and cloud computing markets. Dell continues to be a vital part of the Round Rock
economy and the City continues to be the company's global headquarters. Although the City has
experienced declining sales tax revenue from Dell, the high-level jobs provided by the City's largest
employer has continued to provide a strong local economy. Dell sales tax receipts for fiscal year 2017
8
accounted for 16.4% of total sales tax collected. A concentration risk account has been established to
mitigate the City's annual net exposure to declining sales tax from any single sales taxpayer that represents
more than 5%of the City's net General Fund revenues.
While the City has reduced its reliance on Dell receipts,the remaining sales tax base has grown from$29.8
million in 2008 to$38.5 million for 2017,an increase of 29%over the ten-year period.The reduced reliance
on Dell, and on sales taxes in general, makes the City's finances more stable and less susceptible to any
negative effects of economic downturns.
The City sets utility rates based on the cost of service,establishing an equitable rate structure for total cost
recovery. The utility rate model was updated during 2017. A 3.5%water rate increase went into effect on
October 1,2017 as the first year of three years of adopted rate increases. With future development demands
anticipated for the water system these rate increases are needed to fund capital improvement programs, an
increase in system demands, and operating cost pressures. The base rates for all customer categories have
been increased which reduces revenue volatility that results from weather and conservation. In addition to
the water rate increases, the tiered water rate structure for residential and irrigation customers have been
adjusted to be year-round and is designed to shift more of the cost increase to higher users who are driving
the added costs. Based on the utility rate model,there are no wastewater increases anticipated for the next
several years. Even with the water rate increases, Round Rock water and wastewater rates continue to be
among the lowest in the region.
The City planned ahead to ensure its utility system will serve the future citizens of Round Rock. With
multiple contracts in place with the Brazos River Authority, the City has secured its water supply through
expected buildout in 2050. Water from Lake Georgetown and Stillhouse Hollow Lake in the Brazos River
Basin provide water to the City's current 52 million gallons per day(MGD)water treatment plant.The City
also secured water from Lake Travis in the Lower Colorado River Basin. In order to treat water from Lake
Travis, the City partnered with the Cities of Cedar Park and Leander to form the Brushy Creek Regional
Utility Authority(BCRUA).The BCRUA system will ultimately pump and treat 105.6 MGD which meets
all three Cities' supply needs through buildout. In 2009, in order to provide the most cost effective
wastewater services, the City partnered with the Cities of Cedar Park and Austin to purchase the Brushy
Creek Regional Wastewater System (BCRWWS). The system is currently undergoing improvements to
increase capacity to collect and treat up to 28 MGD of wastewater. The City's portion will be approximately
23 MGD and will serve Round Rock through 2035.
December 2017, the City's Utility System and BCRUA both received an upgraded rating to AAA, the
highest rating of creditworthiness,from Standard and Poor's(S&P). This raised rating reflects the stability
of the City's utility system. S&P also noted that the system had good financial management policies and
practices.
Prospects for the Future
As we look to the future, there are several key initiatives in process now that will shape the development
of Round Rock for the next decade. The City is leveraging available resources to attract industries from
across the globe to strengthen its property tax and sales tax bases. Significant investment in the medical
industry including several state-of-the-art medical facility expansions, combined with the impact of
multiple higher education centers,will provide community development and unlimited opportunities. Not
only will these initiatives shape the physical development of the City but they will also influence the
knowledge base and creativity found in the community.
With the City's natural commercial attractiveness,a strong economic development plan and a strengthening
economy,the future of the community is bright.
9
Awards and Acknowledgements
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting to the City of Round Rock,Texas for its
comprehensive annual financial report for the fiscal year ended September 30, 2016. This was the thirty-
first consecutive year that the City has achieved this prestigious award. To be awarded a Certificate of
Achievement, a government must publish an easily readable and efficiently organized comprehensive
annual financial report. This 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. We believe that our current
comprehensive annual financial report continues to meet the Certificate of Achievement Program's
requirements and we are submitting it to the GFOA to determine its eligibility for another certificate.
In addition, the City of Round Rock also received the GFOA's Distinguished Budget Presentation Award
for its annual budget document for the fiscal year beginning October 1, 2016. To qualify for the
Distinguished Budget Presentation Award,the government's budget document had to be judged proficient
as a policy document, a financial plan,an operations guide and a communications device.
The City of Round Rock earned three Transparency Stars from the Texas Comptroller's Office recognizing
the City's efforts to make information on the City's traditional finances, debt obligations, and economic
development transparent and readily available. During fiscal year 2018,the City will continue to increase
the level of transparency and will apply for the last two remaining stars: Contracts and Procurement and
Public Pensions.
Additionally, the GFOA awarded the City a Certificate of Outstanding Achievement in Popular Annual
Financial Reporting for the fiscal year ended September 30,2016. This award recognizes the City's ability
to extract information from their comprehensive annual financial report to produce high quality popular
annual financial reports specifically designed to be readily accessible and easily understandable to the
general public and other interested parties without a background in public finance and then to recognize
individual governments that are successful in achieving that goal.
The presentation of this report on a timely basis could not be accomplished without the efficient and
dedicated services of the entire staff of the Finance Department. We would like to express our appreciation
to all members of the Department who assisted and contributed to its presentation. Acknowledgement is
also given to Whitley Penn,L.L.P. for their valuable assistance in production of the report. We would also
like to thank the Mayor and Council members for their commitment in planning and conducting the
financial operations of the City in a responsible and progressive manner.
Respectfully submitted,
Laurie Hadley
City Manager
Susan L. Morgan,CPA
Chief Financial Officer
10
r050�Afr~ .�
�*r4OP4
--
11
� � ~'m«.
qm
12
Citizens of Round Rock
Mayor&Council
Municipal Judge City Aft am
Assistant City Manager Assistant Cita Manager
Fire Depsrtment Finance City Clerk Communications&
Marketing
------------
Fire Suppress Accounting&Treasury - ids&Special Events
Fite-Pre"rition Budget $peeiai Events
Human Resources
lnspecOons muili ipal Court 'Social Media
lit.4tal txt�r�t�rrt
l utc Edticaon
General Services
Information Technology
Palm Department Tourism Management& �rxterprisa> pt ati�t�'�s `.
Tourism ts�tructura&Customer
Support
Informatio
Planning&Development CeoWar... n
Services: Investigations rnttort Vf!%trxs Bureau'
Support service$ rest 0 ea4 GottClub Library
Animal Control
l
velopment Services t nsportatiCommunity Engagement
�an Department
Long Range Pla a
Zoning Legislative Issues
Utilities&Environmental
Services
fp'lan�&
later�.stevatter"latrt Parks and Recreation
Operatforis Winienano , Parrs
mer c livat € Re reatic n meters
wee t Reoycilr ;tl?t+ett� gtt
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Round Rock
Texas
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
September 30,2016
Executive Director/CEO
14
FINANCIAL
SECTION
. s
15
Rryn' �...,.
rr• r,�rrj�`
Ali
VIA
JAR
• t
� rrsrrR+rr�a�wr*r��r
r
16
Austin G)f ce
1.
whitleypenn suite,301
XasS7t;1.
S12.478.7165 MIn
INDEPENDENT AUDITORS' REPORT
To the Honorable Mayor and
Members of City Council
City of Round Rock, 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 City of Round Rock, Texas
(the "City"), as of and for the year ended September 30, 2017, 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
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 fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States of America and
the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures 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.
%v rember of 17
Nexia
lnE. rn<ztic.�ii<a( ,Ui,;CHI DaIIas F0rt M.) 11 Hot,iston
To the Honorable Mayor and
Members of City Council
City of Round Rock, Texas
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, as of September 30, 2017, and the respective
changes in financial position,the respective budgetary comparison schedule for the General Fund and the
Round Rock Transportation and Economic Development Corporation Revenue Fund, and, where
applicable, cash flows thereof for the year then ended in accordance with accounting principles generally
accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that management's
discussion and analysis on pages 21 through 32, other post-employment benefit information on page 103,
and pension information on pages 104 through 105 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 the financial
reporting for placing the basic financial statements in an appropriate operational, economic, 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,
and other knowledge we obtained during our audit of the 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 fund
statements and schedules, and statistical section are presented for the purposes of additional analysis and
are not a required part of the basic financial statements. The schedule of expenditures of federal awards is
presented for purposes of additional analysis as required by U.S. Office of Management and Budget
("OMB"); Title 2 U.S Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost
Principles, and Audit Requirements for Federal Awards (Uniform Guidance), and is also not a required
part of the basic financial statements.
The combining and individual fund statements and schedules and schedule of expenditures of federal
awards 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, combining and individual fund statements and
schedules and schedule of expenditures of federal awards are fairly stated in all material respects in
relation to the basic financial statements as a whole.
18
To the Honorable Mayor and
Members of City Council
City of Round Rock, Texas
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 do not express an opinion or provide any
assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated February 2,
2018, on our consideration of the City's internal control over financial reporting and our tests of its
compliance with certain provisions of laws, regulations, contracts, grant agreements and other matters.
The purpose of that report is solely to describe the scope of our testing of internal control over financial
reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness
of the City's 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.
Austin,Texas
February 2,2018
19
. '"
we 1*
20
CITY OF ROUND ROCK,TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
The discussion and analysis of the City of Round Rock's financial performance provides an overview and
analysis of the City's financial activities for the fiscal year ended September 30,2017. It should be read in
conjunction with the accompanying transmittal letter and the accompanying basic financial statements.
Financial Highlights
• The assets and deferred outflows of resources of the City of Round Rock exceeded its liabilities
and deferred inflows of resources at the close of the most recent fiscal year by $835,836,585 (net
position). Of this amount,$165,490,042(unrestricted net position)may be used to meet the City's
ongoing obligations to its citizens and creditors.
• The City's total net position increased by $44,638,845. This increase is a result of$21.6 million
of capital grants and contributions from both governmental and business-type activities, as well as
the receipt of rental revenues from the Kalahari project for governmental activities.
• As of the close of the current fiscal year, the City of Round Rock's governmental funds reported
combined ending fund balances of$173,198,068, a decrease of$832,478 in comparison with the
prior year. The decrease is due in part to the spending down of bond proceeds. The fund balance
of the Hotel Motel Occupancy Tax Fund decreased$6.7 million to help fund the construction and
equipping of the new Multipurpose Complex. Approximately 28.9% of the total fund balance
amount, $50,090,080, is available for spending at the government's discretion (unassigned fund
balance).
• At the end of the current fiscal year,unassigned fund balance for the general fund was$50,090,080,
or 54.3%of the total general fund expenditures.
• The City of Round Rock's total debt increased by $13,377,613 during the current fiscal year. The
change can be attributed to the issuance of general obligation bonds, along with the offset by
regularly scheduled debt principal retirement and savings from refunding state infrastructure bank
loans as more fully described in Note IV(F)to the financial statements.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City of Round Rock's basic
financial statements. The City's basic financial statements comprise three components: 1) government-
wide financial statements,2)fund financial statements,and 3)notes to the financial statements. This report
also contains other 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 Round Rock's finances, in a manner similar to a private-sector business.
The statement of net position presents information on all of the City's assets, liabilities, and deferred
outflows (inflows) of resources with the difference 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
Round Rock is improving or deteriorating.
21
CITY OF ROUND ROCK,TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Government-wide Financial Statements(Continued)
The statement of activities presents information showing how the City's net position changed during the
most recent 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 flows in future fiscal periods (e.g.,
unavailable tax revenues and earned but unused vacation leave).
Both of the government-wide financial statements distinguish functions of the City of Round Rock 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 government, public
safety, public works and culture and recreation. The business-type activities of the City of Round Rock
include water, sewer and drainage utility and a golf course.
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been
segregated for specific activities or objectives. The City of Round Rock, like other 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 two categories: governmental funds and proprietary funds.
Governmental funds
Governmental funds are used to account for essentially the same functions reported as governmental
activities in the government-wide financial statements. However, unlike the government-wide financial
statements, governmental fund financial statements focus on the 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, readers may better
understand the long-term impact of the City's near-term financing decisions. Both the governmental fund
balance sheet and the governmental fiend statement of revenues,expenditures,and changes in fund balances
provide a reconciliation to facilitate this comparison between governmental funds and governmental
activities.
The City of Round Rock maintains 21 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 fund, debt service fund, the Round Rock Transportation and
Economic Development Corporation(RRTEDC)fund,the self-financed construction fund,and the 2014&
2017 General Obligation Bonds fund, all of which are considered to be major funds. Data from the other
16 governmental funds are combined into a single, aggregated presentation. Individual fund data for each
of these nonmajor governmental funds is provided in the form of combining statements elsewhere in the
report.
22
CITY OF ROUND ROCK,TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Fund Financial Statements(Continued)
The City adopts an annual appropriated budget for its General Fund. A budgetary comparison statement
has been provided for the general fund to demonstrate compliance with the budget.
Proprietary funds
The City of Round Rock 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, sewer and drainage utility and for its golf course.
Internal service funds are an accounting device used to accumulate and allocate costs internally among the
City's various functions. The City uses an internal service fund to account for its self-funded health
insurance program and funding of its OPEB liability as of September 30, 2017. The net income(loss) of
the internal service fund is allocated between governmental and business-type activities.
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 the water,sewer
and drainage utility and for the golf course. The water, sewer and drainage utility is considered a major
fund of the City. Since the golf course fund is the only remaining enterprise fund, it is being presented as
a major fund even though it does not meet the criteria of a major fund established in GASB Statement
No. 34. The internal service fund is a single presentation in the proprietary fund financial statements.
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.
Other Information
The combining statements referred to earlier in connection with nonmajor governmental funds and
individual fund schedules are presented immediately following the notes to the financial statements.
Additional information on capital assets used in the operation of governmental funds is provided following
the individual fund schedules.
Government-wide Financial Analysis
Net position is a useful indicator of a government's financial position. For the City of Round Rock,assets
and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $835,836,585
as of September 30, 2017.
The largest portion of the City's net position (72.0%) reflects its investments in capital assets (e.g., land,
buildings and improvements, improvements other than buildings, machinery and equipment and
construction in progress), less any debt used to acquire those assets that is still outstanding. The City uses
23
CITY OF ROUND ROCK,TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Other Information(Continued)
these capital assets to provide services to its citizens;consequently,these assets are not available for future
spending. Although the City's investment in 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 (8.2%) represents resources that are subject to external
restriction on how they may be utilized. The remaining balance of unrestricted net position$165,490,042
may be used to meet the City's ongoing obligations to citizens and creditors.
As of September 30,2017,and 2016,the City was able to report positive balances in all three categories of
net position, both for the City as a whole, as well as for its separate governmental and business-type
activities. The following table provides a comparative summary of the City's net position as of
September 30,2017 and 2016.
Net Position(in 000's)
Governmental Business-Type
Activities Activities Total
2017 2016 2017 2016 2017 2016
Current and other assets $ 197,315 $ 201,297 $ 161,585 $ 145,435 $ 358,900 $ 346,732
Capital assets 553,930 492,228 320,800 324,346 874,730 816,574
Total assets 751,245 693,525 482,385 469,781 1,233,630 1,163,306
Deferred outflows 19,629 21,535 6,314 6,678 25,943 28,213
Long term liabilities 276,704 239,575 88,594 92,853 365,298 332,428
Other liabilities 49,813 59,618 7,303 6,666 57,116 66,284
Total liabilities 326,517 299,193 95,897 99,519 422,414 398,712
Deferred inflows 1,163 1,416 159 193 1,322 1,609
Net position,as restated:
Net investment
in capital assets 356,586 310,186 245,005 234,981 601,591 545,167
Restricted 48,955 51,813 19,801 15,276 68,756 67,089
Unrestricted 37,653 52,452 127,837 126,490 165,490 178,942
Total net position $ 443,194 $ 414,451 $ 392,643 $ 376,747 $ 835,837 $ 791,198
Analysis of Changes in Net Position
The table on the following page summarizes the changes in the City's net position from its activities for the
fiscal year ended September 30, 2017,with comparisons to the previous year.
24
CITY OF ROUND ROCK, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Analysis of Changes in Net Position (Continued)
Changes in Net Position(in 000's)
Governmental Business-Type
Activities Activities Total
2017 2016 2017 2016 2017 2016
Revenues:
Program revenues:
Charges for services $ 9,394 $ 8,589 $ 52,715 $ 49,014 $ 62,109 $ 57,603
Operating grants and
contributions 1,203 947 - - 1,203 947
Capital grants and contributions 5,958 8,013 15,642 19,607 21,600 27,620
General revenues:
Property taxes 49,107 44,239 - - 49,107 44,239
Franchise taxes 7,103 7,175 - - 7,103 7,175
Sales tax 64,210 67,340 - - 64,210 67,340
Hotel occupancy tax 5,515 5,408 - - 5,515 5,408
Public service taxes 627 567 - - 627 567
Rent 17,604 - - - 17,604 -
Investment earnings and other 8,202 7,958 2,290 1,215 10,492 9,173
Total revenues 168,923 150,236 70,647 69,836 239,570 220,072
Expenses:
General government 24,441 28,205 - - 24,441 28,205
Public safety 52,243 49,440 - - 52,243 49,440
Public works 34,360 33,448 - - 34,360 33,448
Culture and recreation 24,130 20,885 - - 24,130 20,885
Interest on long-term debt 8,075 8,294 - - 8,075 8,294
Issuance costs 424 229 - - 424 229
Water and sewer utility - - 49,401 47,948 49,401 47,948
Golf course - - 1,857 133 1,857 133
Total expenses 143,673 140,501 51,258 48,081 194,931 188,582
Increases in net position before
transfers 25,250 9,735 19,389 21,755 44,639 31,490
Transfers 3,493 3,610 3,493) 3,610 - -
Increase in net position 28,743 13,345 15,896 18,145 44,639 31,490
Net position-beginning 414,451 401,106 376,747 358,602 791,198 759,708
Net position-ending $ 443,194 $ 414,451 $ 392,643 $ 376,747 $ 835,837 $ 791,198
Governmental Activities
Governmental activities increased the City's net position by $28,743,227 or 64.4% of the total increase in
the net position of the City over the prior year. Key factors for the increase are as follows:
REVENUES
• Developer contributions of subdivision improvements approximated$3.0 million and are included
in program revenues of public works and culture and recreation activities. This represents a
decrease of$4.6 million, or 60.5%less than the prior year.
25
CITY OF ROUND ROCK, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Governmental Activities(Continued)
• Amounts received for property taxes increased from last year by 11.0% due primarily to an
increase of$0.005 in the nominal property tax rate from$0.42500 for fiscal year 2016 to$0.43000
for fiscal year 2017. Other factors include addition of new property to the tax base. Property tax
makes up 32.2%of total general revenues.
• Sales tax collections of$64.2 million decreased 4.6%,compared to prior year. This is a result of
a shift in how sales tax rebates for economic development agreements are accounted for. In fiscal
year 2016 and earlier the gross sales tax receipts were recognized as revenues and the sales tax
rebates were expensed. In fiscal year 2017 the sales tax rebates were moved to offset the gross
sales tax receipts in the revenues to more accurately portray the actual net sales tax revenues which
decreased the revenues.
• Charges for services increased by $804,675 primarily due to the popularity of the expanded
Rock'N River Pool Complex and the opening of the Multipurpose Sports Complex.
• Hotel occupancy tax revenues increased 2.0% or $107,000. This is a result of new rooms and
higher average room rates for area hotel/motels. The occupancy rate decreased from 80.9% in
2016 to 77.1% in 2017. The statewide occupancy rate was 64.9%in 2017.
• Grants and contribution revenues decreased 20.0%, or$1.8 million. This decrease is due largely
to the amount of capital grants and contributions received in public works. Grants and contribution
revenues can vary year to year depending on current development within the City.
EXPENSES
Expenses for governmental activities for the City totaled $143,673,435 for the year ended
September 30,2017. Significant factors include the following:
• General government costs decreased $3.8 million from$28.2 million in 2016 to $24.4 million in
2017, or 13.3%. This decrease is due primarily to the shift in how sales tax rebates for economic
development agreements are accounted for. In fiscal year 2016 and earlier the gross sales tax
receipts were recognized as revenues and the sales tax rebates were expensed as general
government costs. In fiscal year 2017 the sales tax rebates were moved to offset the gross sales
tax receipts in the revenues to more accurately portray the actual net sales tax revenues which
decreased the expenses.
• Public safety program costs including police and fire department activities totaled about
$52.2 million,or 36.3%of total expenses for governmental activities. This is an increase of 5.7%,
compared to prior year. This increase is due primarily to personnel costs which included 10 new
positions,including an additional assistant fire chief,a fire code inspector,seven additional sworn
police personnel, and one civilian police position, plus contractual salary increases and increased
health benefits.
• Public works program costs increased$911,428, or 2.7%, compared to prior year. This increase
is due in part to an expansion in the City's transit system to offer new local circulator and regional
express routes.
• Culture and recreation increased $3.2 million from $20.9 million in 2016 to $24.1 million, or
15.5%, in 2017. This increase is due in part to the continued popularity of the expanded Rock'N
River Pool Complex and the Round Rock Sports Center, along with the newly opened
Multipurpose Sports Complex.
26
CITY OF ROUND ROCK, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Business-Type Activities
Business-type activities increased the City's net position by $15,895,618 or 35.6% of the total growth in
the net position of the City over the prior year. Key factors for the increase are as follows:
REVENUES
• The City's water, sewer and drainage utility continues to show increases in the number of
customers and operating revenues. Scheduled uses of impact fees received have allowed current
rates to remain stable while still providing adequate times coverage of utility bonded debt service.
Comparative data for the past two fiscal years are presented as follows:
2017 2016
Operating revenues $ 51,980,615 $ 48,653,788
Operating income $ 5,960,735 $ 4,397,665
Income available for debt
service $ 24,618,423 $ 21,146,727
Annual debt service $ 6,352,459 $ 6,680,204
Coverage 3.88 3.53
• The City sets utility rates based on the cost of service. This model establishes an equitable rate
structure for total cost recovery. There were no retail rate increases for water or wastewater for
fiscal year 2017. However,higher wholesale water rates went into effect October 1, 2016 as part
of a 3-year scheduled rate increase. The City's wholesale customers make up approximately
15.0% of revenues each year. Even with the rate increases, Round Rock water and wastewater
rates continue to be among the lowest in the region.
EXPENSES
• Expenses of the business-type activities increased $3.2 million from prior year due to costs of
treating higher volumes of water to serve a growing number of customers and normal weather
fluctuations. The expenses of the Golf Course Fund increased due to the implementation of a new
management company and how the financial transactions are recorded.
Financial Analysis of the Government's Funds
As noted earlier,the City of Round Rock uses fiend 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 government's net resources
available for spending at the end of the fiscal year.
27
CITY OF ROUND ROCK,TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Governmental Funds(Continued)
For the fiscal year ended September 30, 2017, the City's governmental funds reported combined ending
fund balances of$173,198,068. Approximately 28.9% of this total amount of$50,090,080 constitutes
unassigned fund balance and is available for spending at the City's discretion. $1,004,583 is assigned to
culture recreation while $28,522,368 of the fund balance is committed to either capital projects or special
revenue projects/programs. The remainder of fund balance is restricted or non-spendable to indicate that it
is not available for new spending because it has already been committed to 1) pay debt service of
$3,880,982, 2)fund authorized construction of$81,086,426, 3)other restricted purposes of$8,381,625 or
4)non-spendable of$232,004.
The General Fund is the chief operating fund of the City. At the close of the current fiscal year, fund
balance of the General Fund reached$50,322,084,of which$50,090,080 was unassigned. Unassigned fund
balance represented 54.3%of total General Fund expenditures.
During the current fiscal year, the fund balance of the General Fund decreased by $2,478,000 because of
planned transfers to fund one-time capital projects. The General Fund total revenues exceeded the budget
by $4,785,473. The City continues to budget revenues conservatively but with the continued population
growth and increase in property values, the property taxes and sales tax revenues continue to surpass
budgeted projections.
The debt service fund had a total fund balance of$3,8801982 at the end of the fiscal year, all of which is
restricted for the payment of debt service. The net increase in fund balance during the year was$1,131,337.
Debt service expenditure requirements decreased by$1,654,427 during the fiscal year and were adequately
funded by the debt service portion of the property tax.
The fund balance of the RRTEDC fund was $35,662,207, a decrease of$368,501 compared to the prior
year. The decrease reflects a reduction in transfers out of this fund to fund transportation system
improvements and related maintenance and debt service costs. This is a result of higher costs incurred for
transportation projects, compared to the prior year.
The self-financed construction fund and the 2014 & 2017 general obligation bonds fund had a combined
total fund balance at year-end of$69,411,485. The collective net increase of$8,152,229 is a result of the
spending down of the 2014 general obligation bonds and the issuance of 2017 general obligation bonds.
Proprietary Funds
The City's proprietary fund statements provide the same type of information found in the government-wide
financial statements, but in more detail. Unrestricted net position of the water and sewer fund totaled
$127,104,170 at September 30, 2017. The total growth in net position for the water and sewer fund was
$16,667,294. The unrestricted net position represented 32.8%of the utility's total net position.
General Fund Budgetary Highlights
One budget amendment was taken to City Council for the General Fund for the year ended September 30,
2017.The budget amendment added three additional positions to the General Fund to help meet immediate
staffing needs. The positions added are an assistant director for general services, a neighborhood services
assistant, and a planning inspector.
28
CITY OF ROUND ROCK, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Capital Assets and Debt Administration
Capital Assets
The City of Round Rock's investment in capital assets for its governmental and business-type activities as
of September 30, 2017, amounted to $874,729,303 (net of accumulated depreciation). This investment
includes land, buildings and improvements, improvements other than buildings (including infrastructure),
machinery and equipment,and construction in progress.
Major capital asset events during the year ended September 30, 2017, included the following:
• The City acquired$28.2 million in land for the future Kalahari family resort,water park and
convention center.
• Projects underway and completed that were funded by the 2014&2017 G.O. bonds are as
follows:
• Construction was completed on the Round Rock Multipurpose Complex at a cost of$27.7
million.The facility was opened in May 2017.Construction is underway on the Old Settler's
Park's soccer fields with$2.2 million spent to date.
• South East Fire Station#8 located on Red Bud Lane was completed at a cost of$5.7 million.
• Fire Station#4 relocation was completed at a cost of$5.1 million.
• Expansion of citywide trails began at an estimated cost of$18.9 million with $3.2 million
incurred to date.
• Neighborhood park improvements,ADA upgrades,and facility improvements are underway
with total cost estimated at$5.1 million and$2.4 million spent to date.
• Construction is underway on a public safety training facility. The total estimated cost is
$29.4 million with$15.0 million spent to date and an anticipated completion date in Summer
2018.
• Projects underway and completed that were funded by the 2014 C.O. bonds are as follows:
• Creek Bend Boulevard Extension roadway extension project was completed at a cost of$10.5
million.
• Southwest Downtown Phase 5A Improvement project was substantially completed during
the year at a total cost of$17.4 million. This project included improvements to Mays Street,
Main Street, and Round Rock Avenue.
• Construction is underway on the Southwest Downtown Phase 5B Improvement project with$2.8
million spent to date. This project includes improvements to Bagdad Avenue, McNeil Road,
Florence Street, and Blair Street.
• Additional Downtown Improvement projects are at various stages of completion with$1.4 million
spent to date.
• Major arterial, signal, and road projects are underway and at various stages of completion.
Completed projects totaled$7.6 million while construction in progress at year-end approximated
$14.8 million.
• City facility improvements were completed at a cost of $947,000 and information technology
infrastructure upgrades were completed at a cost of$506,000.
• Various street and sidewalk improvement projects were completed at a cost of$701,000.
29
CITY OF ROUND ROCK,TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Capital Assets(Continued)
• Design is underway for the new Luther Peterson Service Center which will consolidate the Utility
and Environmental Services,Transportation,and General Services Departments with construction
starting in 2018.The total estimated cost is$16.5 million funded from both utility funds and future
bond funds.
• Developers contributed infrastructure improvements for governmental activities of$3.0 million,
and$7.3 million for water, sewer and drainage system infrastructure improvements.
• Design is underway for various water pump station improvements throughout the City. The total
cost is estimated at$3.4 million with completion in 2018.
• Various water and wastewater line replacement projects were completed and placed in service at
a cost of$8.5 million and similar projects were in progress costing$2.0 million to date.
Capital Assets(in 000's)
Governmental Business-Type
Activities Activities Total
2017 2016 2017 2016 2017 2016
Land $ 82,456 $ 53,134 $ 8,453 $ 8,453 $ 90,909 $ 61,587
Buildings and improvements 146,682 135,706 22,436 22,437 169,118 158,143
Improvements other than bldgs 654,984 592,991 453,845 437,267 1,108,829 1,030,258
Machinery and equipment 81,237 73,386 19,860 16,012 101,097 89,398
Accumulated depreciation (452,082) (422,643) (188,065) (172,385) (640,147) (595,028)
Construction in progress 40,653 59,654 4,271 12,562 44,924 72,216
Total $ 553,930 $ 492,228 $ 320,800 $ 324,346 $ 874,730 $ 816,574
Additional information on the City of Round Rock's capital assets can be found in Note IV (E) to the
financial statements.
Long-Term Debt
At the end of the current fiscal year, the City of Round Rock had total debt outstanding of$307,715,000.
Of this amount,$196,930,000 comprises debt backed by the full faith and credit of the City. The remainder
of the City's debt is secured solely by specified revenue sources(i.e.,revenue bonds).
During the current fiscal year, the City of Round Rock's total debt increased by $13,377,613. The net
increase is largely due to the City issuing 2017 general obligation bonds. The City also refinanced its state
infrastructure bank loans to take advantage of favorable interest rates. Details of the refunding and
issuances can be found in Note IV(F) (4)to the financial statements. Regularly scheduled debt principal
was retired during 2017 as well.
30
CITY OF ROUND ROCK, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Long-Term Debt(Continued)
Long-Term Debt(in 000's)
Governmental Business-Type
Activities Activities Total
2017 2016 2017 2016 2017 2016
General obligation bonds $ 170,615 $ 149,540 $ - $ - $ 170,615 $ 149,540
Certificates of obligation 26,315 27,095 - - 26,315 27,095
Hotel tax revenue bonds 11,675 12,320 - - 11,675 12,320
Sales tax revenue bonds 17,540 9,180 - - 17,540 9,180
State infrastructure bank loans - 11,527 - - - 11,527
Water and wastewater
revenue bonds - - 81,570 84,675 81,570 84,675
Total $ 226,145 $ 209,662 $ 81,570 $ 84,675 $ 307,715 $ 294,337
The City of Round Rock benefits substantially in reduced interest costs resulting from recently affirmed
bond ratings by Moody's Investors Service of Aal, and Standard&Poor's recently raised its rating of the
Utility Revenue bonds to AAA.
There is no direct debt limitation in the City Charter or under state law. The City operates under a Home
Rule Charter(Article XI, Section 5,Texas Constitution), approved by the voters,that limits the maximum
tax rate,for all City purposes to$2.50 per$100 assessed valuation. Administratively,the Attorney General
of the State of Texas will permit allocation of$1.50 of the $2.50 maximum tax rate for general obligation
debt service. The resulting legal debt margin is$1,735,889,178. Of the maximum tax rate for debt service
of$1.50, the City uses $0.15313, or 10.21%. Of$49,113,540 levied in property taxes for the fiscal year
ended September 30, 2017, 99.75% of taxes levied were collected during the fiscal year. The City is
conservative in how it issues debt and has adopted a"pay as you go"philosophy by using excess cash funds
to fund current projects and issuing debt only when deemed necessary. Additional information on the City's
long-term debt can be found in Note IV(F)to the financial statements.
Economic Factors and Next Year's Budgets and Rates
The development of the City's budget is guided by several factors including the Council's Strategic Goals,
prevailing economic conditions and the continuing need to provide basic and improved customer services
for a growing population. The fiscal year 2017-2018 budget adopted by the City Council adheres to the
City's financial policies and preserves the City's strong financial position while providing excellent levels
of service. During the creation of the 2017-2018 budget process the City Manager and Executive team
focused on various budget drivers in the decision-making process.
• Addressing council Strategic Goals
• Meeting the demands of growth with additions to maintain service levels
• Biennial citizen survey results
• Voter authorized general obligation debt to expand programs and services
• Debt payments for new programs
• Competitive employee compensation and benefits
• Maintenance of parks, facilities, and streets
• Compliance with financial policies
31
CITY OF ROUND ROCK, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30,2017
Economic Factors and Next Year's Budgets and Rates(Continued)
Revenue assumptions in general for fiscal year 2017-2018 are expected to follow the growth curve of job
creation, population growth,retail sales activity, and housing starts.
The City's economy is expected to generate approximately$64.3 million in sales tax revenue for fiscal year
2018. This amount includes the 1/2% or $17.3 million in additional sales and use tax for roads and
economic development. The remaining 1 1/2% is projected to generate $47.0 million for general
operations,property tax reduction, and capital projects.
The fiscal year 2018 certified taxable property value for Round Rock is$12.5 billion,an increase of 10.6%
from last year's $11.3 billion. The adopted property tax rate for fiscal year 2018 is $0.43000 per$100 of
valuation. The tax rate is an increase of 2.7 cents over the effective rate of$0.40317, and well below the
rollback rate of$0.43494. The 2.7 cent increase over the effective tax rate is to provide funds for debt
payments, operations for voter-approved bond projects and rising costs. With an adopted rate of$0.43000,
the City continues to have one of the lowest tax rates in Central Texas, and is among the lowest rates in the
state for medium-sized cities.
The Water and Wastewater Utility operations are funded primarily through user fees. The City's utility
infrastructure and service delivery systems have been carefully planned and have sufficiently met demand
for a growing customer base. Water sales are conservatively estimated using customer base projections,
while at the same time taking into account changing weather conditions. Water conservation and drought
contingency programs continue to help the City conserve existing water sources. There is a 3.5% water
rate increase included in the fiscal year 2018 budget which went into effect on October 1, 2017. This rate
increase is the first year of a three-year planned implementation stemming from a recently updated water
and wastewater rate model. With future development demands anticipated for the water system,these rate
increases are needed to fund capital improvement programs, an increase in system demands,and operating
pressures. Based on the water and wastewater rate model, no wastewater increases are anticipated for the
next several years.
Requests for Information
This financial report is designed to provide citizens, taxpayers, customers, investors and creditors with a
general overview of the City's finances and to show the City's accountability for the money it receives. If
you have questions about this report or need additional financial information, contact the Chief Financial
Officer,City of Round Rock, 221 East Main Street,Round Rock,Texas 78664.
32
BASIC FINANCIAL STATEMENTS
33
CITY OF ROUND ROCK, TEXAS
STATEMENT OF NET POSITION
SEPTEMBER 30,2017
Governmental Business-Type
Activities Activities Total
ASSETS
Cash and cash equivalents $ 10,614,676 $ 10,241,094 $ 20,855,770
Investments 88,460,815 93,553,502 182,014,317
Receivables(net of allowance for uncollectibles)-
Property taxes 282,358 - 282,358
Accounts&other 7,354,941 18,432,989 25,787,930
Accrued interest 127,868 414,856 542,724
Intergovernmental - 3,881,561 3,881,561
Grants 454,887 - 454,887
Interfund (730,840) 730,840 -
Inventories 192,943 416,272 609,215
Other current assets 302,566 434,249 736,815
Restricted assets-
Cash and cash equivalents 16,335,397 7,405,282 23,740,679
Investments 72,280,877 12,718,117 84,998,994
Property tax receivable 158,512 - 158,512
Accounts and other 1,426,712 710,916 2,137,628
Accrued interest 53,673 19,337 73,010
Investment in joint venture - 12,626,402 12,626,402
Capital assets-
Land and construction in progress 123,108,963 12,723,826 135,832,789
Capital asset, net of accumulated depreciation 430,820,688 308,075,826 738,896,514
Total assets 751,245,036 482,385,069 1,233,630,105
DEFERRED OUTFLOWS OF RESOURCES
Deferred amount on refundings 5,985,503 4,406,750 10,392,253
Pension contributions after measurement date 6,217,717 894,272 7,111,989
Pension actuarial losses,net of amortization 7,425,257 1,012,536 8,437,793
Total deferred outflows of resources 19,628,477 6,313,558 25,942,035
The accompanying notes are an integral part of this financial statement.
34
Governmental Business-Type
Activities Activities Total
LIABILITIES
Accounts payable $ 13,775,439 $ 1,421,492 $ 15,196,931
Accrued payroll 2,797,002 376,485 3,173,487
Unearned revenue 11,7859007 17,209 11,802,216
Accrued interest payable 1,531,983 525,592 2,057,575
Customer deposits - 1,071,900 1,071,900
Due within one year 19,922,839 3,890,278 23,813,117
Net pension liability 39,486,545 5,384,529 44,871,074
Due in more than one year 237,217,705 83,209,956 320,427,661
Total liabilities 326,516,520 95,897,441 422,413,961
DEFERRED INFLOWS OF RESOURCES
Pension actuarial gains,net of amortization 1,163,003 158,591 1,321,594
Total deferred inflows of resources 1,163,003 158,591 1,321,594
NET POSITION
Net investment in capital assets 356,586,425 245,005,044 601,591,469
Restricted for-
Debt service 2,565,183 598,039 3,163,222
Capital projects 38,007,544 19,202,683 57,210,227
Hotel-motel tax 6,526,672 - 6,526,672
Public safety 585,878 - 585,878
General government 1,269,075 - 1,269,075
Unrestricted 37,653,213 127,836,829 1653490,042
Total net position $ 443,193,990 $ 392,642,595 $ 835,836,585
35
CITY OF ROUND ROCK,TEXAS
STATEMENT OF ACTIVITIES
SEPTEMBER 30,2017
Program Revenues
Operating Capital
Charges for Grants and Grants and
Functions/Programs Expenses Services Contributions Contributions
Governmental activities:
General government $ 24,441,262 $ 2,174,874 $ 1,104,251 $ -
Public safety 52,243,460 1,478,161 25,259 -
Public works 34,359,785 607,398 - 5,484,996
Culture and recreation 24,130,067 5,133,816 73,300 473,209
Interest on long-term debt 8,075,351 - - -
Issuance costs 423,510 - - -
Total governmental activities 143,673,435 9,394,249 1,202,810 5,958,205
Business-type activities:
Water and sewer utility 49,400,833 51,980,615 - 15,579,756
Golf course 1,857,334 733,883 - 62,625
Total business-type activities 51,258,167 52,714,498 - 15,642,381
Total primary government $ 194,931,602 $ 62,108,747 $ 1,202,810 $ 21,600,586
The accompanying notes are an integral part of this financial statement.
36
Net(Expense)Revenue and
Changes in Net Position
Primary Government
Governmental Business-Type
Functions/Programs Activities Activities Total
Governmental activities:
General government $ (21,162,137) $ - $ (21,162,137)
Public safety (50,740,040) - (50,740,040)
Public works (28,267,391) - (28,267,391)
Culture and recreation (18,449,742) - (18,449,742)
Interest on long-term debt (8,075,351) - (8,075,351)
Issuance costs (423,510) - (423,510)
Total governmental activities (127,118,171) - (127,118,171)
Business-type activities:
Water and sewer utility - 18,159,538 18,159,538
Golf course - (1,060,826) (1,060,826)
Total business-type activities - 17,098,712 17,098,712
Total primary government (127,118,171) 17,098,712 110,0 19,45 9,N)
General revenues:
Taxes:
Property taxes, levied for general purpose 31,423,791 - 31,423,791
Property taxes, levied for debt service 17,683,633 - 17,683,633
Franchise taxes 7,103,548 - 7,103,548
Sales taxes 64,209,719 - 64,209,719
Hotel occupancy tax 5,515,163 - 5,515,163
Public service taxes 627,164 - 627,164
Rent 17,603,565 - 17,603,565
Unrestricted investment earnings and other 8,201,944 2,289,777 10,491,721
Transfers 3,492,871 (3,492,871) -
Total general revenues and transfers 155,861,398 (1,203,094) 154,658,304
Change in net position 28,743,227 15,895,618 44,638,845
Net position-beginning 414,450,763 376,746,977 791,197,740
Net position-ending $ 443,193,990 $ 392,642,595 $ 835,836,585
37
CITY OF ROUND ROCK,TEXAS
GOVERNMENTAL FUNDS BALANCE SHEET
SEPTEMBER 30,2017
Round Rock
Transportation
and Economic
General Debt Service Development
Fund Fund Corporation Fund
ASSETS
Cash and cash equivalents $ 5,705,857 $ - $ 93,001
Investments 47,194,877 - -
Receivables(net of allowance for uncollectibles)-
Property taxes,including interest and penalties 282,358 - -
Accounts and other 5,271,399 956 1,537,098
Accrued interest 66,614 - -
Interfund - 7,530 -
Grants 135,339 - -
Inventories 192,943 - -
Other current assets 39,061 - -
Restricted assets-
Cash and cash equivalents - 920,305 3,887,443
Investments - 2,952,191 32,207,673
Receivables-
Property taxes,including interest and penalties - 158,512 -
Sales tax - - 1,426,712
Accrued interest - - 45,461
Total assets $ 58,888,448 $ 4,039,494 $ 39,197,388
LIABILITIES,DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities-
Accounts payable $ 5,357,875 $ - $ 3,535,181
Accrued payroll 2,743,023 - -
Interfund payables 83,562 - -
Unearned revenue 99,546 - -
Totalliabilities 8,284,006 - 3,535,181
Deferred inflows of resources-
Unavailable revenue-property taxes 282,358 158,512 -
Total deferred inflows of resources 282,358 158,512 -
Fund balances-
Nonspendable 232,004 - -
Restricted-debt service - 3,880,982 -
Restricted-authorized construction - - 35,662,207
Restricted-hotel-motel tax - - -
Restricted-public safety - - -
Restricted-general government - - -
Committed-general government - - -
Committed-capital projects funds - - -
Assigned-culture and recreation - - -
Unassigned 50,090,080 - -
Total fund balances 50,322,084 3,880,982 35,662,207
Total liabilities,deferred inflows of resources and
fund balances $ 58,888,448 $ 4,039,494 $ 39,197,388
The accompanying notes are an integral part of this financial statement.
38
2014&2017
Self- General Nonmajor Total
Financed Obligation Bonds Governmental Governmental
Construction Fund Funds Funds
$ 2,824,311 $ - $ 1,207,977 $ 9,831,146
24,788,156 - 9,986,196 81,969,229
- - - 282,358
- - 528,333 7,337,786
38,141 - 13,950 118,705
- - 76,032 83,562
287,900 - 31,648 454,887
- - - 192,943
176,005 - - 215,066
- 10,099,384 1,428,265 16,335,397
34,828,771 2,292,242 72,280,877
- - 158,512
- - 1,426,712
- 4,976 3,236 53,673
$ 28,114,513 $ 44,933,131 $ 15,567,879 $ 190,740,853
$ 733,381 $ 2,902,778 $ 499,158 $ 13,028,373
- - 53,979 2,797,002
- 83,562
- - 1,093,432 1,192,978
733,381 2,902,778 1,646,569 17,101,915
- - - 440,870
440,870
232,004
- - - 3,880,982
42,030,353 3,393,866 81,086,426
- 6,526,672 6,526,672
- 585,878 585,878
- 1,269,075 1,269,075
- - 124,703 124,703
27,381,132 - 1,016,533 28,397,665
- - 1,004,583 1,004,583
- - - 50,090,080
27,381,132 42,030,353 13,921,310 173,198,068
$ 28,114,513 $ 44,933,131 $ 15,567,879 $ 190,740,853
39
,Mr, 0,4 '.,N.w,,
Vft
Yep'"
•+I",,,Mr��r�rj�
40
CITY OF ROUND ROCK,TEXAS
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION
Total Fund Balances-Governmental Funds $ 173,198,068
Amounts reported for Governmental Activities in the Statement of Net
Position are different because:
Capital assets used in governmental activities are not financial resources and,
therefore,are not reported in the funds. These assets consist of:
Land $ 82,456,114
Construction in progress 40,652,849
Building and improvements 801,665,286
Equipment 81,237,374
Accumulated depreciation (452,081,972)
Total capital assets $ 553,929,651 553,929,651
Deferred amounts on refundings are deferred outflows of resources and,
therefore,are not reported in the funds. 5,985,503
Contributions to the pension plan after the measurement date are deferred
outflows of resources and,therefore, are not reported in the funds. 6,217,717
Pension actuarial losses (gains) are deferred outflows (inflows) of resources
and,therefore, are not reported in the funds. 6,262,254
Property tax revenues collected in advance of the fiscal year to which they
apply are recorded as deferred inflows of resources in the funds and recognized
as revenue of the period to which they apply. 440,870
Internal service funds are used by management to charge the costs of self-
funded insurance to individual funds. The assets and liabilities of the internal
service funds are included in governmental activities in the Statement of Net
Position. 5,911,028
Unearned rent revenue for the land acquisition associated with the Kalahari
project is not a financial resource and,therefore, is not reported in the funds. (10,592,029)
Accrued interest payable in the governmental funds are not recognized
because they are not paid within the prescribed time period after year end. (1,531,983)
Some long-term liabilities are not due and payable in the current period and,
therefore, are not reported in the funds. They are detailed in Note III(A). (296,627,089)
Net Position of Governmental Activities $ 443,193,990
The accompanying notes are an integral part of this financial statement.
41
CITY OF ROUND ROCK, TEXAS
GOVERNMENTAL FUNDS
STATEMENT OF REVENUES,EXPENDITURES AND
CHANGES IN FUND BALANCES
YEAR ENDED SEPTEMBER 30,2017
Round Rock
Transportation
and Economic
Debt Development
General Service Corporation
Fund Fund Fund
Revenues-
Taxes and franchise,
including interest and penalties $ 85,573,078 $ 17,726,552 $ 17,614,117
Licenses,permits and fees 1,605,412 - -
Charges for services 4,854,852 - -
Fines and forfeitures 1,235,903 - -
Grants 649,921 - 1,567,082
Hotel occupancy tax - - -
Investment and other 5,127,744 101,787 909,022
Contributions - - 601,833
Total revenues 99,046,910 17,828,339 20,692,054
Expenditures-
Current-
General government 19,171,885 - -
Public safety 47,351,032 - -
Public works 11,434,437 - 1,248,066
Culture and recreation 14,2621422 - -
Debt service-
Principal retirement - 13,287,160 -
Interest and fiscal charges - 8,306,767 -
Payment to Refunding Agent - 10,050,443 -
Issuance costs - 86,311 -
Capital projects - - 16,627,120
Total expenditures 92,219,776 31,730,681 17,875,186
Excess(deficiency)of revenues
over expenditures 6,827,134 (13,902,342) 2,816,868
Other financing sources(uses)-
Issuance of debt - - -
Issuance of refunding bonds - 10,140,000 -
Issuance of premium - - -
Transfers in 3,355,800 4,893,679 834,829
Transfers out (12,660,934) - (4,020,198)
Total other financing sources(uses) (9,305,134) 15,033,679 (3,185,369)
Net change in fund balances (2,478,000) 1,131,337 (368,501)
Fund balances,October 1,2016 52,800,084 2,749,645 36,030,708
Fund balances, September 30,2017 $ 50,322,084 $ 3,880,982 $ 35,662,207
The accompanying notes are an integral part of this financial statement.
42
2014&2017
Self- General Nonmajor Total
Financed Obligation Governmental Governmental
Construction Bonds Fund Funds Funds
$ - $ - $ 228,498 $ 121,142,245
- 40,665 1,646,077
- 1,452,525 6,307,377
- 204,892 1,440,795
254,241 - 479,589 2,950,833
- - 5,515,163 5,515,163
1,265,913 393,912 455,236 8,253,614
37,500 - 292,268 931,601
1,557,654 393,912 8,668,836 148,187,705
1,148,278 - 735,769 21,055,932
- - 244,852 47,595,884
- - - 12,682,503
2,957,278 17,219,700
- 13,287,160
- - - 8,306,767
- - 10,050,443
- 337,199 - 423,510
10,219,680 25,659,170 10,762,716 63,268,686
11,367,958 25,996,369 14,700,615 193,890,585
(9,810,304) (25,602,457) (6,031,779) (45,702,880)
28,585,000 - 28,585,000
- - 10,140,000
- 2,652,531 - 2,652,531
12,878,262 1,800 9,944,100 31,908,470
(552,603) - (11,181,864) (28,415,599)
12,325,659 31,239,331 (1,237,764) 44,870,402
2,515,355 5,636,874 (7,269,543) (832,478)
24,865,777 36,393,479 21,190,853 174,030,546
$ 27,3815132 $ 42,030,353 $ 1359215310 $ 173,198,068
43
CITY OF ROUND ROCK, TEXAS
RECONCILIATION OF THE STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES OF
GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
YEAR ENDED SEPTEMBER 30,2017
Amounts reported for governmental activities in the statement of activities are different because:
Net Change in Fund Balances-Total Governmental Funds $ (832,478)
Governmental funds report capital outlays as expenditures. However, in the
statement of activities,the cost of those assets is allocated over their estimated
useful lives and reported as depreciation expense. This is the amount by which
capital outlays exceeded depreciation. 58,474,502
The net effect of various miscellaneous transactions involving capital assets
(i.e. sales,disposals,and donations) is to increase net position. 3,226,912
Property tax revenues in the statement of activities that do not provide current
financial resources are not reported as revenues in the hinds. (94,390)
The issuance of long-term debt (i.e. bonds, leases) provides current financial
resources to the governmental funds, while the repayment of the principal of
long-term debt consumes the current financial resources of governmental
funds. Also,governmental funds report the effect of issuance costs,premiums,
discounts, and similar items when debt is first issued,whereas these amounts
are deferred and amortized in the Statement of Activities. This amount is the
net effect of these differences in the treatment of long-term debt and related
items. (18,091,774)
The land acquisition associated with the Kalahari project did not require the
use of current financial resources and,therefore, is not reported in the funds. (10,592,029)
Some expenses reported in the statement of activities do not require the use of
current financial resources and, therefore, are not reported as expenditures in
governmental funds. These include:
Pension costs, net (2,336,083)
Interest and employee expense (256,284)
Internal service funds are used to charge the costs of self-funded insurance to
the individual funds. The net revenue of certain activities of the internal
service fund is reported with governmental activities. (755,149)
Change in Net Position of Governmental Activities $ 28,743,227
The accompanying notes are an integral part of this financial statement.
44
CITY OF ROUND ROCK, TEXAS
GENERAL FUND
SCHEDULE OF REVENUES,EXPENDITURES AND CHANGES
IN FUND BALANCE -BUDGET AND ACTUAL
YEAR ENDED SEPTEMBER 30,2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Taxes and franchise,
including interest and penalties $ 82,470,000 $ 82,573,294 $ 85,573,078 $ 2,999,784
Licenses,permits and fees 1,233,600 1,274,243 1,605,412 331,169
Charges for services 4,552,600 4,552,600 4,854,852 302,252
Fines and forfeitures 1,115,000 1,115,000 1,235,903 120,903
Grants 365,000 3651000 649,921 284,921
Investment and other 4,381,300 4,381,300 5,127,744 746,444
Total revenues 94,117,500 94,261,437 99,046,910 4,785,473
Expenditures-
Current-
General government 22,479,783 19,941,621 19,171,885 769,736
Public safety 45,402,718 47,395,697 47,351,032 44,665
Public works 15,608,723 12,517,868 11,434,437 1,083,431
Culture and recreation 13,620,710 14,263,512 14,2621422 1,090
Total expenditures 97,111,934 94,118,698 92,219,776 1,898,922
Excess(deficiency)of revenues
over expenditures (2,994,434) 142,739 6,827,134 6,684,395
Other financing sources(uses)-
Transfers in 3,355,800 3,355,800 3,355,800 -
Transfers out (9,600,000) (12,725,000) (12,660,934) 64,066
Total other financing sources
(uses), net (6,244,200) (9,369,200) (9,305,134) 64,066
Net change in hind balance $ (9,238,634) $ (9,226,461) (2,478,000) $ 6,748,461
Fund balance,October 1,2016 52,800,084
Fund balance,September 30,2017 $ 50,322,084
The accompanying notes are an integral part of this financial statement.
45
CITY OF ROUND ROCK,TEXAS
ROUND ROCK TRANSPORTATION AND
ECONOMIC DEVELOPMENT CORPORATION FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCE -BUDGET AND ACTUAL
YEAR ENDED SEPTEMBER 30,2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Sales tax $ 16,433,333 $ 16,433,333 $ 17,614,117 $ 1,180,784
Grants 2,000,000 2,000,000 1,567,082 (432,918)
Investment and other 752,084 752,084 909,022 156,938
Contributions 1,500,000 1,500,000 601,833 (898,167)
Total revenues 20,685,417 20,685,417 20,692,054 6,637
Expenditures-
Public works 2,353,133 2,353,133 1,248,066 1,105,067
Capital projects 16,336,772 16,627,120 16,627,120 -
Total expenditures 18,689,905 18,980,253 17,875,186 1,105,067
Excess of revenues
over expenditures 1,995,512 1,705,164 2,816,868 1,111,704
Other financing sources(uses)-
Transfers in - - 834,829 834,829
Transfers out (4,020,200) (4,020,200) (4,020,198) 2
Total other financing sources (uses) (4,020,200) (4,020,200) (3,185,369) 834,831
Net change in fund balances $ (2,024,688) $ (2,315,036) (368,501) $ 1,946,535
Fund balance, October 1,2016 36,030,708
Fund balance, September 30,2017 $ 35,662,207
The accompanying notes are an integral part of this financial statement.
46
s
e
a!
ka�aa�M taa aa•aaw 7f
1�
47
CITY OF ROUND ROCK, TEXAS
PROPRIETARY FUNDS
STATEMENT OF NET POSITION
SEPTEMBER 30,2017
Business-Type Activities Governmental
Enterprise Funds Activities
Water and Golf Course Internal
Sewer Fund Fund Total Service Fund
ASSETS
Current assets:
Cash and cash equivalents $ 10,241,094 $ - $ 10,241,094 $ 783,530
Investments 93,553,502 - 93,553,502 6,491,586
Receivables(net of allowance
for uncollectibles of$443,426)-
Accounts 18,358,544 74,445 18,432,989 17,155
Accrued interest 414,856 - 414,856 9,163
Intergovernmental 3,881,561 - 3,881,561 -
Inventories 416,272 - 416,272 -
Other current assets 434,249 - 434,249 87,500
Total current assets 127,300,078 74,445 127,374,523 7,388,934
Noncurrent assets:
Restricted cash,cash equivalents,
and investments:
Impact fees 7,320,566 - 7,320,566 -
Construction 11,151,864 - 11,1.51,864 -
Customer deposits 1,052,930 - 1,052,930 -
Revenue bond covenant accounts 598,039 - 598,039 -
Restricted accounts and accrued
interest receivable:
Restricted impact fees 710,916 - 710,916 -
Restricted accrued interest 19,337 - 19,337 -
Investment in joint venture 12,626,402 - 12,626,402 -
Capital assets:
Land and construction in progress 10,764,623 1,959,203 12,723,826 -
Capital assets being depreciated 305,342,924 2,732,902 308,075,826 -
Total capital assets(net of accumulated
depreciation of$188,064,786) 316,107,547 4,692,105 320,799,652 -
Total noncurrent assets 349,587,601 41692,105 354,279,706 -
Total assets 476,887,679 4,766,550 481,654,229 7,388,934
DEFERRED OUTFLOWS OF RESOURCES
Pension contributions after measurement
date 894,272 - 894,272 -
Pension actuarial losses, net of amortization 1,012,536 - 1,012,536 -
Deferred charges on refunding 4,406,750 - 4,406,750 -
Total deferred outflows of resources 6,313,558 - 6,313,558 -
The accompanying notes are an integral part of this financial statement.
48
Business-Type Activities Governmental
Enterprise Funds Activities
Water and Golf Course Internal
Sewer Fund Fund Total Service Fund
LIABILITIES
Current liabilities:
Accounts payable $ 1,366,075 $ 55,417 $ 1,421,492 $ 747,066
Accrued payroll 376,485 - 376,485 -
Accrued benefit obligations 468,087 - 468,087 -
Unearned revenue - 17,209 17,209 -
Accrued interest 525,592 - 525,592 -
Customer deposits 1,071,900 - 1,071,900 -
Current portion of bonds payable 3,422,191 - 3,422,191 -
Total current liabilities 7,230,330 72,626 7,302,956 747,066
Noncurrent liabilities:
Net pension liability 5,384,529 - 5,384,529 -
Bonds payable 82,605,242 - 82,605,242 -
Noncurrent accrued benefit obligations 604,714 - 604,714 -
Total noncurrent liabilities 88,594,485 - 88,594,485 -
Totalliabilities 95,824,815 72,626 95,897,441 747,066
DEFERRED INFLOWS OF RESOURCES
Pension actuarial gains,net of amortization 158,591 - 158,591 -
NET POSITION
Net investment in capital assets 240,312,939 4,692,105 245,005,044 -
Restricted for:
Debt service 598,039 - 598,039 -
Capital projects 19,202,683 - 19,202,683 -
Unrestricted 127,104,170 1,819 127,105,989 6,641,868
Total net position $ 387,217,831 $ 4,693,924 391,911,755 $ 6,641,868
Reconciliation to government-wide statement of net position:
Adjustment to reflect the cumulative net profit of the internal
service fund that was allocated to enterprise fund functions. 730,840
Net position of business-type activities $ 392,642,595
The accompanying notes are an integral part of this financial statement.
49
CITY OF ROUND ROCK,TEXAS
PROPRIETARY FUNDS
STATEMENT OF REVENUES,EXPENSES AND CHANGES IN NET POSITION
YEAR ENDED SEPTEMBER 30,2017
Business-Type Activities Governmental
Enterprise Funds Activities
Water and Golf Course Internal
Sewer Fund Fund Total Service Fund
Operating revenues-
Charges for services $ 47,769,478 $ 733,883 $ 48,503,361 $ 11,721,652
Licenses,permits, and fees 4,211,137 - 4,211,137 -
Total revenues 51,980,615 733,883 52,714,498 11,721,652
Operating expenses-
Personnel services 10,669,214 - 10,669,214 -
Contractual services 14,854,212 1,721,083 16,575,295 2,880,220
Supplies 855,379 - 8555379 -
Materials 1,649,261 6,579 1,655,840 935
Heat, light and power 1,618,297 - 1,618,297 -
Claims expense - - - 10,077,914
Depreciation 165373,517 119,521 16,493,038 -
Total operating expenses 46,019,880 1,847,183 47,867,063 12,959,069
Operating income(loss) 5,960,735 (1,113,300) 4,847,435 (1,237,417)
Nonoperating revenues(expenses)-
Investment and other revenues 25284,171 5,606 2,289,777 338,209
Interest and fiscal charges (3,2361894) (10,151) (3,247,045) -
Total nonoperating
revenues(expenses) (952,723) (4,545) (957,268) 338,209
Income before contributions
and transfers 5,008,012 (1,117,845) 3,890,167 (899,208)
Contributions and transfers-
Contributions-impact fees 8,215,831 - 8,215,831 -
Contributions-infrastructure 7,298,800 - 7,298,800 -
Contributions-other 65,125 62,625 127,750 -
Transfers in - 427,603 427,603 -
Transfers out (3,920,474) - (3,920,474) -
Total contributions and transfers 11,659,282 490,228 12,149,510 -
Change in net position 16,667,294 (627,617) 16,039,677 (899,208)
Net position,October 1,2016 370,550,537 5,321,541 7,541,076
Net position, September 30,2017 $ 387,217,831 $ 4,693,924 $ 6,641,868
Reconciliation to government-wide statement of activities:
Adjustment to reflect the net profit of the internal
service fund that was allocated to enterprise fund functions (144,059)
Change in net position of business-type activities $ 15,895,618
The accompanying notes are an integral part of this financial statement.
50
CITY OF ROUND ROCK, TEXAS
PROPRIETARY FUNDS
STATEMENT OF CASH FLOWS
YEAR ENDED SEPTEMBER 30,2017
Business-Type Activities Governmental
Enterprise Funds Activities
Water and Golf Course Internal
Sewer Fund Fund Total Service Fund
Cash flows from operating activities:
Cash received from customers $ 41,195,893 $ 709,890 $ 41,905,783 $ 689,359
Cash received from other funds for
services provided - - - 11,032,945
Cash payments to suppliers for goods
and services (19,279,466) (1,672,245) (20,951,711) (12,948,656)
Cash payments to employees for services (10,199,658) - (10,199,658)
Net cash provided(used)by
operating activities 11,716,769 (962,355) 10,754,414 (1,226,352)
Cash flows from noncapital financing activities:
Transfers from other funds - 427,603 427,603 -
Transfers to other funds (3,920,474) - (3,920,474)
Net cash provided(used)by noncapital
financing activities (3,920,474) 427,603 (3,492,871) -
Cash flows from capital and related
financing activities:
Proceeds from sale of capital assets 149,985 1,215 151,200 -
Acquisition and construction of capital assets (5,996,340) (48,634) (6,044,974) -
Investment in joint venture (424,030) - (424,030) -
Principal paid on revenue bonds (3,337,191) - (3,337,191) -
Contributions 65,125 - 65,125 -
Impact fees 8,215,831 - 8,215,831 -
Interest and fiscal charges paid (2,986,216) (10,151) (2,996,367)
Net cash used by capital and
related financing activities (4,312,836) (57,570) (4,370,406) -
Cash flows from investing activities:
Sale(purchase)of investments (6,478,894) 501,952 (5,976,942) 485,445
Investment and other income 1,834,641 5,080 1,839,721 338,916
Net cash provided(used)by
investing activities (4,644,253) 507,032 (4,137,221) 824,361
Net decrease in cash and cash equivalents (1,160,794) (85,290) (1,246,084) (401,991)
Cash and cash equivalents at beginning of year 18,807,170 85,290 18,892,460 1,185,521
Cash and cash equivalents at end of year $ 17,646,376 $ - $ 17,646,376 $ 783,530
The accompanying notes are an integral part of this financial statement. (CONTINUED)
51
CITY OF ROUND ROCK,TEXAS
PROPRIETARY FUNDS
STATEMENT OF CASH FLOWS
YEAR ENDED SEPTEMBER 30,2017
Business-Type Activities Governmental
Enterprise Funds Activities
Water and Golf Course Internal
Sewer Fund Fund Total Service Fund
Reconciliation of Cash and Cash Equivalents
to Proprietary Fund Statement of Net Position
Cash and cash equivalents $ 10,241,094 $ - $ 10,241,094 $ 783,530
Restricted assets-
Cash and cash equivalents 7,405,282 - 7,405,282 -
Cash and cash equivalents $ 17,646,376 $ - $ 17,646,376 $ 783,530
Reconciliation of operating income(loss)to
net cash provided(used)by operating activities
Operating income(loss) $ 5,960,735 $ (1,113,300) $ 4,847,435 $ (1,237,417)
Adjustments to reconcile operating income
(loss)to net cash provided(used)by operating
activities:
Depreciation 16,373,517 119,521 16,493,038 -
Provision for bad debts 3,683 - 3,683 -
(Increase)decrease in:
Receivables (10,778,316) (41,202) (10,819,518) 652
Customer deposits (10,089) - (10,089) -
Inventory 254,908 - 254,908 -
Other assets (14,985) - (14,985) -
Pension related deferred outflows 258,665 - 258,665 -
Increase(decrease)in:
Accounts payable (564,470) 55,417 (509,053) 10,413
Accrued payroll (37,451) - (37,451) -
Customer deposits 22,230 - 22,230 -
Compensated absences 112,452 - 112,452 -
Unearned revenue - 17,209 17,209 -
Pension related deferred inflows (34,477) - (34,477) -
Increase in net pension liability 170,367 - 170,367 -
Total adjustments 5,756,034 150,945 5,906,979 11,065
Net cash provided(used)by operations $ 11,716,769 $ (962,355) $ 10,754,414 $ (1,226,352)
NOTES:
Noncash capital and related financing activities:
In fiscal year 2017, the Water and Sewer Fund had $7,298,800 in capital assets contributed, recognized a
change of($996,629)in fair value of investments, and a change of($3,453,820)in joint venture net position.
The accompanying notes are an integral part of this financial statement.
52
NOTES TO THE
FINANCIAL
STATEMENTS
53
w
>Not .3
VM
IIS►
54
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Round Rock, Texas (the City) is a municipal corporation incorporated under Article XI.
Section 5 of the Constitution of the State of Texas (Home Rule Amendment). The City operates under a
Council-Manager form of government. The financial statements of the City have been prepared in
accordance with generally accepted accounting principles (GAAP) as applied to governmental units. The
Governmental Accounting Standards Board (GASB) is the standard-setting body for governmental
accounting and financial reporting. The GASB periodically updates its codification of the existing
Governmental Accounting and Financial Reporting Standards which, along with subsequent GASB
pronouncements (Statements and Interpretations), constitutes GAAP for governmental units. The more
significant of these accounting policies are described below, and where appropriate, subsequent
pronouncements will be referenced.
A. REPORTING ENTITY
The City provides various services and performs many different functions. These include a police force, a
fire fighting and protection force, emergency medical services, a park and recreation system, a municipal
golf course, a public library, convention and tourism support, planning and zoning, and a waterworks and
sewer utility system. The City's staff provides the necessary support for the services provided. All are
responsible to the Citizens of Round Rock and are therefore included within the reporting entity.
As required by generally accepted accounting principles,these financial statements present the City and its
component unit, an entity for which the City is considered to be financially accountable. Blended
component units, although legally separate entities, are, to substance, part of the City's operations and so
data from these units are combined with data of the City.
Blended Component Unit
The Round Rock Transportation and Economic Development Corporation(Corporation), an entity legally
separate from the City, is governed by a seven-member board appointed by the City Council. The City
Council maintains budgetary control of the Corporation. For financial reporting purposes,the Round Rock
Transportation and Economic Development Corporation is presented as a part of the City's operations
because its purpose is to utilize sales tax revenues for the improvement of the City's transportation system
and for economic development purposes. No less than 90% of the Corporation funds will be used for
transportation projects. The remaining 10% may be used for economic development purposes covered
under local government code. The revenues of the Corporation,its administrative expenditures,and capital
projects are accounted for in a special revenue fund.
B. BASIS OF PRESENTATION — GOVERNMENT-WIDE AND FUND FINANCIAL
STATEMENTS
The basic financial statements include both government-wide (based on the City as a whole) and fund
financial statements. GASB Statement No. 34 requires certain supplementary information. Management's
Discussion and Analysis includes an analytical overview of the City's financial activities. In addition,
budgetary comparison statements are presented that compare the adopted and amended budgets of the
General Fund and the Round Rock Transportation and Economic Development Corporation Fund with their
actual results.
55
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
B. BASIS OF PRESENTATION—GOVERNMENT-WIDE AND FUND FINANCIAL
STATEMENTS(CONTINUED)
Government-wide Statements:
The government-wide financial statements(i.e.,the statement of net position and the statement of activities)
report information on all non-fiduciary activities of the primary government and its component unit.
Governmental activities, which are normally supported by taxes and intergovernmental revenues, are
reported separately from business-type activities,which are funded by fees and charges for services.
The City's statement of net position includes both non-current assets and non-current liabilities of the City.
In addition,the government-wide statement of activities reflects depreciation expense on the City's capital
assets, including infrastructure.
The government-wide statement of activities demonstrates the degree to which the direct expenses of a
functional category (police, fire, public works, etc.) are offset by program revenues. Direct expenses are
those that are clearly identifiable with a specific function. Program revenues include 1) charges to
customers or applicants who purchase, use or directly benefit from goods, services, or privileges provided
by a given function or segment, 2) grants and contributions that are restricted to meeting the operational
requirements of a particular function or segment, and 3) grants and contributions that are restricted to
meeting the capital requirements of a particular function or segment. Taxes and other items not properly
included among program revenues are reported as general revenues.
The net cost(by function or business-type activity)is normally covered by general revenue(property,sales
or franchise taxes, intergovernmental revenues, interest income,etc.).
The government-wide focus is more on the sustainability of the City as an entity and the change in aggregate
financial position resulting from financial activities of the fiscal period. The focus of the fund financial
statements is on the major individual funds of the governmental and business-type categories and the
component unit. Each presentation provides valuable information that can be analyzed and compared to
enhance the usefulness of the information.
Fund Financial Statements:
Separate fund based financial statements are provided for governmental funds and proprietary funds. Major
individual governmental funds and major individual enterprise funds are reported as separate columns in
the fund financial statements. An emphasis is placed on major funds within the governmental and
proprietary categories. GASB Statement No. 34 sets forth minimum criteria (percentage of assets,
liabilities, revenues or expenditures/expenses of either fund category for the governmental and enterprise
combined)for the determination of major funds. The major governmental funds are the General Fund,the
Debt Service Fund, the Round Rock Transportation and Economic Development Corporation Fund, the
Self-Financed Construction Fund, and the 2014 & 2017 General Obligation Bonds Fund. The nonmajor
funds are combined in a separate column in the fund financial statements.
The Internal Service Fund, which provides services to the other funds of the government, is presented as
part of the proprietary fund financial statements. The net income (loss) of the Internal Service Fund is
allocated between governmental and business-type activities. Because the principal users are the City's
governmental activities, financial statements of the Internal Service Fund are consolidated into the
56
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
B. BASIS OF PRESENTATION–GOVERNMENT-WIDE AND FUND FINANCIAL
STATEMENTS(CONTINUED)
governmental column when presented at the government-wide level. The costs of these services are
reflected in the appropriate functional activity(general government,public safety,public works,etc.).
C. GOVERNMENTAL FUND TYPES
Governmental funds are those through which most governmental functions of the City are financed. The
acquisition,use and balances of the City's expendable financial resources and the related current liabilities
(except those, if any, which should be accounted for in proprietary funds) are accounted for through
governmental funds. The measurement focus is upon determination of financial position and changes in
financial position, rather than upon net income determination. The City maintains the following
governmental fund types:
The General Fund accounts for financial resources in use for general types of operations, which are not
encompassed within other funds. The General Fund is considered a major fund in the fund financial
statements.
The Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than
major capital projects)that are legally restricted to expenditures for specified purposes.
There are eleven groups of funds within the Special Revenue Funds which account for the activities related
to grant programs, hotel-motel room taxes, transportation system improvement sales tax and funds
designated for specific service programs. They are as follows:
Major Fund
— Round Rock Transportation and Economic Development Corporation Fund
Nonmajor Funds
— Community Development Block Grant Fund
— Hotel-Motel Occupancy Tax Fund
— Hotel-Motel Occupancy Venue Tax Fund
— Landscape Fund
— Library Fund
— Multipurpose Sports Complex Fund
— Municipal Court Fund
— Police Fund
— Public Education& Government Fund
— Traffic Safety Program Fund
The Round Rock Transportation and Economic Development Corporation Fund is considered a major
fund in the fund financial statements. It accounts for sales tax monies and donations/developer
contributions received for streets, drainage and other transportation system improvements, including
maintenance and capital costs associated with such authorized projects.
57
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
C. GOVERNMENTAL FUND TYPE (CONTINUED)
The Debt Service Fund is used to account for the accumulation of resources for, and the payment of,
governmental long-term debt principal, interest and related costs. The Debt Service Fund is considered a
major fund in the fund financial statements.
The Capital Proiects Funds are used to account for financial resources to be used for the acquisition or
construction of capital facilities(other than those financed by proprietary funds). There are eleven groups
of funds within the Capital Projects Fund which account for the activities related to various capital
improvements projects as follows:
Major Funds
— 2014&2017 General Obligation Bonds Fund
— Self-Financed Construction Fund
Nonmajor Funds
— 2004&2007 General Obligation Bonds Fund
— 2014 Certificates of Obligation Fund
— Convention Center Complex Fund
— Park Development Fund
— Streets and Drainage Fund
— Tourism Development Fund
The Self-Financed Construction Fund and the 2014 and 2017 General Obligation Bonds Fund are
considered major funds in the fund financial statements. The Self-Financed Construction Fund accounts
for the costs of authorized general capital improvements and facilities. Financing is provided by general
government resources. The 2014 and 2017 General Obligation Bonds Fund account for projects related to
fire department facilities, parks and recreational purposes, library facilities and police and fire training
facilities.
D. PROPRIETARY FUND TYPES
The Proprietary Funds are used to account for the City's ongoing organizations and activities that are
similar to those found in the private sector. The measurement focus is upon capital maintenance and upon
determination of net income, financial position and cash flows. The City maintains the following
Proprietary Fund type:
The Enterprise Funds are used to account for operations that are financed and operated in a manner similar
to private business enterprises-where the intent of the governing body is that the costs(expenses including
depreciation) of providing goods or services to the general public on a continuing basis be financed or
recovered primarily through user charges. The City's Enterprise Fund consists of the Water and Sewer
Utility Fund, which includes the City's storm water drainage program, and the Golf Course Fund. These
funds are primarily supported by user charges.
58
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
E. OTHER FUND TYPES
The Internal Service Fund is used to account for the financing of goods or services provided by one
department or agency to other City departments or agencies on a cost-plus basis. The City's Internal Service
Fund is the Self-Funded Health Insurance Fund,which is used to account for the activities of the City's self-
funded health insurance program.
F. NON-CURRENT GOVERNMENTAL ASSETS/LIABILITIES
GASB Statement No. 34 eliminated the presentation of account groups, but provides for these records to
be maintained and incorporates the information into the governmental activities column in the government-
wide statement of net position.
G. BASIS OF ACCOUNTING
Government-wide Statements
The government-wide financial statements are reported using the economic resources measurement focus
and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when
a liability is incurred, regardless of the timing of the related cash flows. Property taxes are recognized as
revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon
as all eligibility requirements imposed by the provider have been met.
Fund Financial Statements
In the fund financial statements, all governmental funds are accounted for using a modified accrual basis
of accounting. Governmental funds use the current financial resources measurement focus. Under this
basis, revenues are recognized in the accounting period in which they become measurable and available.
Expenditures are recognized in the accounting period in which the fund liability is incurred, if measurable.
Governmental Funds
Revenue Recognition
In applying the susceptible to accrual concept under the modified accrual basis of accounting,revenues are
recorded when deemed both measurable and available. Measurable means that the amount of the
transaction can be determined. Available means the amount of the transaction is collectible within the
current period or soon enough thereafter to be used to pay liabilities of the current period. For this purpose,
the City considers revenues to be available if they are collected within 60 days of the end of the current
fiscal year.
Property tax revenues are recognized when they become available. In this case,available means when due,
or past due and receivable within the current period and collected within the current period or soon enough
thereafter to be used to pay liabilities of the current period. Such time thereafter shall not exceed 60 days.
59
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
G. BASIS OF ACCOUNTING(CONTINUED)
Hotel taxes, franchise fees, and special assessments are recorded when susceptible to accrual, both
measurable and available. Sales taxes collected and held by the State at year-end on behalf of the City are
also recognized as revenue. Licenses and permits, charges for services, fines and forfeitures and other
revenues (except earnings on investments) are recorded as revenues when received in cash because they
are generally not measurable until actually received. Earnings on investments are recorded on the accrual
basis in all funds. Unrealized gains or losses on investments are also recognized in accordance with GASB
Statement No. 31.
In applying the susceptible to accrual concept to grant revenues,the legal and contractual requirements of
the individual grant programs are used for guidance. Monies received are generally unrestricted as to
purpose of expenditure and are revocable only for failure to comply with prescribed compliance
requirements. These resources are recognized as revenues at the time of receipt,or sooner,if the susceptible
to accrual criteria are met.
The City reports unavailable revenue on its fund financial statements. Unavailable revenues arise when
potential revenue does not meet both the"measurable" and"available" criteria for recognition in the current
period. Unearned revenues arise when the City receives resources before it has a legal claim to them, as
when grant monies are received prior to the incurrence of qualifying expenditures. In subsequent periods,
when both revenue recognition criteria are met or when the City has a legal claim to the resources, the
liability for unearned revenue is removed from the balance sheet and revenue is recognized.
Expenditure Recognition
The measurement focus of governmental fund accounting is on decreases in net financial resources
(expenditures)rather than expenses. Most expenditures are measurable and are recorded when the related
fund liability is incurred except for unmatured principal and interest on governmental long-term debt which
are recognized when paid. Allocations of costs, such as depreciation and amortization, are not recognized
in the governmental funds' fund financial statements.
Proprietary Funds
In the fund financial statements and the government-wide statements,proprietary and agency funds utilize
the accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized in the
accounting period in which they are earned and become measurable. Expenses are recorded in the
accounting period incurred, if measurable.
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. The principal operating revenues of the
Water and Sewer Fund,the Golf Course Fund and the Internal Service Fund are charges to customers for
sales and services. Operating expenses for the Enterprise Funds and Internal Service Fund include the cost
of sales and service, administrative expenses and depreciation on capital assets. All revenue and expenses
not meeting this definition are reported as non-operating revenues and expenses.
60
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
H. CASH AND CASH EQUIVALENTS
In accordance with GASB Statement No. 9, for reporting purposes, the City has developed a definition of
cash equivalents. Cash equivalents are demand deposit account balances, investments with the State
Investment Pool, repurchase agreements, obligations of the United States government and its agencies,
commercial paper and certificates of deposit with original maturities of three months or less.
I. INVESTMENTS
All investments are presented at fair value. The fair value of U.S. Government Securities is based upon
discounted future cash flows. The fair value of the positions in the state investment pools is the same as
the value of the pool shares.
The City pools excess cash of the various individual funds to purchase these investments. These pooled
investments are reported in the combined balance sheet as investments in each fund based on each fund's
share of the pooled investments. Interest income is allocated to each respective individual fund, monthly,
based on their respective share of investments in the pooled investments. The City's local government
investment pools are recorded at amortized costs as permitted by GASB Statement No. 79, Certain
Investment Pools and Pool Participants.
J. INVENTORIES AND PREPAID ITEMS
Inventories of supplies for all funds are valued at cost. The consumption method is used to account for
inventories. Under the consumption method, an expenditure is recognized when inventory items are used.
Cost is determined for inventories of supplies on the first-in, first-out method.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items (other current assets) in both the government-wide and fund financial statements.
K. JOINT VENTURE
Joint venture represents the City's equity interest calculated in accordance with the agreement for the
Brushy Creek Regional Utility Authority(BCRUA). The City's initial investment in this joint venture was
recorded at cost. The City shares in the operating results in this joint venture so the City adjusts its equity
interest by the amount of its participating share of the joint venture's change in net position.
L. CAPITAL ASSETS
Capital assets are stated at historical cost. Maintenance and repairs are charged to operations as incurred.
Improvements and betterments, which extend the useful lives of assets, are capitalized.
The accounting and reporting treatment applied to the capital assets associated with a fund are determined
by the fund's measurement focus. The minimum capitalization threshold is any individual item with a total
cost greater than$5,000 and a useful life of at least 5 years. Donated capital assets, donated works of art,
and similar items are reported at acquisition value rather than fair value.
61
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
L. CAPITAL ASSETS(CONTINUED)
Public domain capital assets (infrastructure) have been capitalized. Infrastructure consists of certain
improvements other than buildings, including roads, curbing, gutters, streets and sidewalks and drainage
systems.
In the government-wide statements, depreciation of plant and equipment classified by functional
components is provided by the straight-line method over their estimated useful lives. Estimated useful lives
are as follows:
Buildings 30-50 years
Improvements other than buildings 10-40 years
Machinery and equipment 5- 10 years
When capital assets are retired or otherwise disposed of, a gain or loss on disposal of assets is recognized.
In the fund financial statements, because of the application of the current financial resources focus and the
use of modified accrual accounting for governmental funds, depreciation is only recognized for the
Enterprise Funds.
For the Enterprise Fund's capital assets,interest is capitalized on construction costs. The amount of interest
cost capitalized for assets constructed with tax-exempt borrowings is equal to the cost of borrowing, less
interest earned on related interest-bearing investments acquired with proceeds of the related tax-exempt
borrowings. The total amount of interest expense incurred and expensed was$3,247,045.
M. LONG-TERM DEBT
In the government-wide financial statements, and proprietary fund types in the fiend financial statements,
long-term debt and other long-term obligations are reported as liabilities in the applicable governmental
activities,business-type activities, or proprietary fund type statement of net position. Bond premiums and
discounts are deferred and amortized over the life of the bonds using the effective interest method. Bonds
payable is reported net of the applicable bond premium or discount. Deferred amounts related to refundings
are reported as deferred outflow of resources and amortized over the shorter of the refunded or refunding
debt.
In the fund financial statements,governmental fund types recognize bond premiums and discounts,as well
as bond issuance costs, during the current period. The face amount of debt issued is reported as other
financing sources. Premiums received on debt issuances are reported as other financing sources while
discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld
from the actual debt proceeds received, are reported as debt service expenditures.
Hotel Occupancy Tax Revenue Bonds were issued to fund the City's portion of the construction of a
convention center complex. The project costs were shared with a private corporation in accordance with
the Master Agreement Regarding Convention Center Development. Venue Tax and Hotel Occupancy
Revenue Bonds were issued to fund a portion of the construction of a sports center. The Hotel Occupancy
62
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
M. LONG-TERM DEBT(CONTINUED)
Tax Revenue Bonds and Venue Tax and Hotel Occupancy Tax Revenue Bonds are to be repaid from the
hotel tax revenues.
Loans from the State Infrastructure Bank have been received to fund transportation improvements. The
loans are to be repaid from revenues of the Round Rock Transportation and Economic Development
Corporation. The final portions of these loans were fully refunded in July 2017 when the City issued
$10,140,000 of Senior Lien Sales Tax Revenue bonds.
Revenue bonds, which have been issued to fund capital projects of the Enterprise Fund, are to be repaid
from net revenues of the utility systems.
Sales tax revenue bonds have been issued to fund transportation improvements. The bonds are to be repaid
from revenues of the Round Rock Transportation and Economic Development Corporation.
N. ACCRUED BENEFIT OBLIGATIONS
Unpaid Compensated Absences
Each employee may accumulate a total of two years vacation eligibility. Employees are paid for the
accumulated vacation upon termination. Effective January 1, 1994, sick pay does not vest for non-Civil
Service employees;therefore,a liability is only recorded for sick leave relating to Civil Service employees.
The City accrues a liability for accumulated vacation and sick leave benefits, which meet the following
criteria:
— The City's obligation to fitnd accumulated vacation and sick leave benefits is
attributable to employees'services already rendered.
— The obligation relates to rights that vest or accumulate.
— Payment of the compensation is probable.
— The amount can be reasonably estimated.
All vacation pay is accrued when incurred in the government-wide and proprietary fund financial
statements. A liability for these amounts is reported in governmental funds only if they have matured, for
example, as a result of employee resignations and retirements.
Other Post-Employment Benefits
The City provides its retirees the opportunity to maintain health insurance coverage by participating in the
City's self insurance plan. The City accrues a liability for the annual required contribution, as determined
by an actuary,less the actual cost incurred on a pay as you go basis on the government-wide and proprietary
fund financial statements. The actual cost recorded in the governmental fund financial statements is the
cost of the health benefits incurred on behalf of the retirees less the premiums collected from the retirees.
63
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
O. TRANSACTIONS BETWEEN FUNDS
Short-term advances between funds are accounted for in the appropriate interfund receivable and payable
accounts. All legally authorized transfers are appropriately treated as transfers and are included in the
results of operations of both governmental and proprietary funds. Nonrecurring or non-routine transfers of
equity between funds — for example, contribution of capital assets to a proprietary fund or transfers of
residual balances of discontinued funds to other funds-are accounted for as transfers.
As a rule, the effect of interfund activity has been eliminated from the government-wide statement of net
position. Exceptions to this rule are cost reimbursement transactions between the enterprise fiend and
various other functions of the government for utilities and for reimbursement of personnel costs for
employees administering grant programs. Elimination of these charges would distort the direct costs and
program revenues reported for the various functions concerned.
P. NET POSITION
Net position in government-wide and proprietary fund financial statements are classified as net investment
in capital assets,restricted,and unrestricted. Net investment in capital assets consists of: capital assets net
of accumulated depreciation, outstanding balances of capital-related borrowings, and capital-related
deferred outflows(inflows)of resources. Net position classified as restricted are balances with constraints
on resources that are either externally imposed by creditors, grantors, contributors, or laws or regulations
of other governments or imposed by law through state statute.
Certain bond proceeds, as well as resources set aside for their repayment, are classified as restricted assets
because their use is limited by bond covenants. Other assets are restricted due to City Ordinance restrictions
on their use.
Net position has been restricted for the excess of restricted assets over related liabilities to the extent such
restricted assets were accumulated from revenues (i.e., in some cases, restricted assets were obtained in
total or in part from the proceeds of bond sales or grants).
When both restricted and unrestricted resources are available for use,it is the City's policy to use restricted
resources first,then unrestricted resources as they are needed.
Q. CLASSIFICATION OF FUND EQUITY
Governmental funds' fund balance classifications describe the relative strength of the spending constraints
placed on the purposes for which resources can be used:
Nonspendable fund balance—Nonspendable fund balances are amounts that are not in spendable form or
are required to be maintained intact.
Restricted fund balance—Restricted fund balances are amounts that are constrained to specific purposes
by creditors, grantors,contributors, or laws or regulations of other governments.
64
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Q. CLASSIFICATION OF FUND EQUITY (CONTINUED)
Committed fund balance—Committed fund balances are amounts that are committed to specific purposes
by City Council through an ordinance. Amounts cannot be used for other purposes unless the City Council
takes the same action to remove or change the constraint. The most significant commitment in the special
revenue funds is for the tree replacement program. The commitments in the capital projects funds are for
park improvements,street maintenance, and construction of roads and facilities.
Assigned fund balance—Assigned fund balances are amounts that the City intends to use for a specific
purpose but are neither restricted nor committed. Assignments are made by City management based on
Council direction.
Unassigned fund balance — Unassigned fund balances are amounts that are available for any legal
purposes. The General Fund is the only fund that reports an unassigned fund balance amount.
For the classification of governmental fund balances,the City considers the expenditure to be made from
the most restrictive first when more than one classification is available.
R. MINIMUM FUND BALANCE POLICY
It is the desire of the City to maintain an adequate fund balance in the General Fund to maintain liquidity
and in anticipation of economic downturns or natural disasters. The City Council has adopted a financial
standard to maintain a General Fund minimum fund balance. In recognition of fund balance reserve best
practices,the fund balance reserve in the General Fund shall be transitioned from one hundred twenty(120)
days to ninety (90)days or 25% of annual budgeted General Fund operating expenditures beginning with
the fiscal year 2017/18 budget year. Reserves will be set at the 2016/17 amount and allowed to stay level
until such time as General Fund operating expenditures require increasing reserves to meet the new 90-day
requirement. Staff will evaluate the financial stability of the General Fund revenues annually to ensure the
reserve requirement remains adequate.
S. DEFERRED OUTFLOWS/INFLOWS OF RESOURCES
In addition to assets, the statement of financial position and/or balance sheet 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 items that qualify for
reporting in this category by the City include the following:
• 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 or refunding debt. The deferred charge
on refundings is reported in the government-wide statement of net position.
• Pension contributions after measurement date - These contributions are deferred and
recognized in the following fiscal year.
• Difference in projected and actual earnings on pension assets -This difference is deferred and
amortized over a closed five-year period.
65
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
S. DEFERRED OUTFLOWS/INFLOWS OF RESOURCES(CONTINUED)
In addition to liabilities, the statement of financial position and/or balance sheet 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. Reported as a deferred inflow for the
City are the difference in expected and actual pension experience and the difference arising from changes
in assumptions(both are deferred and recognized over the estimated average remaining lives of all members
determined as of the measurement date). For the governmental funds, property taxes received in advance
of the fiscal year to which they apply are reported as deferred inflows of resources.
T. TAP-IN(CONNECTION FEES)AND IMPACT FEES
Water and sewer tap-in fees(connection fees)represent reimbursement of the costs incurred to perform the
connection of the respective utilities. These fees are recorded as operating revenue at the time of service.
The impact fee substantially exceeds the cost of connection to the water and sewer system, and is therefore
viewed as a contribution. Effective with the implementation of GASB Statement No. 33, impact fees are
recorded as contributions in the Enterprise Fund.
U. USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles generally accepted in the
United States of America requires management to make estimates and assumptions that affect certain
reported amounts and disclosures. Specifically,the actuarial calculations to determine the annual required
contributions of the retirement and other post-employment benefits are based on assumptions about events
far into the future. Accordingly, actual results could differ from those estimates.
V. 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 GASB Statement No.68,Accounting and Financial
Reporting for Pensions-an amendment of GASB Statement No. 27.
W. NEW AND FUTURE FINANCIAL REPORTING REQUIREMENTS
The GASB has issued the statement on the following page which will become effective in fiscal year 2018.
66
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
W. NEW AND FUTURE FINANCIAL REPORTING REQUIREMENTS(CONTINUED)
Statement No. 75, "Accounting and Financial Reporting for Postemployment Benefits Other Than
Pensions." — This statement changes the focus of accounting of postemployment benefits other than
pensions from whether they are responsibly funding the benefits over time to a point-in-time liability that
is reflected on the employer's financial statements for any actuarially underfunded portion of benefits earned
to date. This statement will become effective for the City in fiscal year 2018.
II. STEWARDSHIP,COMPLIANCE AND ACCOUNTABILITY
A. BUDGETARY ACCOUNTING
The City follows these procedures in establishing the appropriated budget as reflected in the accompanying
financial statements:
(1) At least sixty days prior to the beginning of each fiscal year, the City Manager
submits to the City Council a proposed budget for the fiscal year beginning on the
following October 1. The operating budget, which represents the financial plan
for the ensuing fiscal year, includes proposed expenditures and the means of
financing them.
(2) Public hearings are conducted at which all interested persons' comments
concerning the budget may be heard.
(3) The budget is legally enacted by the City Council through passage of an
appropriation ordinance and tax-levying ordinance not later than the final day of
the last month of the fiscal year.
(4) Formal budgetary integration is employed as a management control device during
the year for the General Fund, Special Revenue Funds, Debt Service Fund and
Proprietary Funds. Management control for the operating budget is maintained at
the individual office,department, or agency level.
(5) Annual budgets are legally adopted for the General Fund, Special Revenue Funds,
Debt Service Fund and the Proprietary Funds. Capital Projects Funds have no
binding annual budget. Project-length financial plans are adopted for all capital
projects; accordingly, no comparison of budget to actual is presented in the
financial statements.
(6) Amendments that alter total expenditures of any fund must be approved by the City
Council. Although costs are monitored on a departmental basis,the level of control
at which expenditures may not exceed the budget is at the fund level. The reported
budgetary data has been revised for amendments authorized.
(7) Any appropriation balances lapse or revert to the undesignated fund balances at
the close of each fiscal year.
67
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
II. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY (CONTINUED)
A. BUDGETARY ACCOUNTING (CONTINUED)
The budgets of the various funds are prepared on a basis consistent with generally accepted accounting
principles as described above. The following table compares original to final budgets for the General Fund.
Amendments
Original Increase Final
Budget (Decrease) Budget
Revenues-
Taxes and franchise,
including interest and penalties $ 82,47000 $ 103,294 $ 82,573,294
Licenses,permits and fees 1,233,600 40,643 1,274,243
Charges for services 4,552,600 - 4,552,600
Fines and forfeitures 1,115,000 - 1,115,000
Intergovernmental 365,000 - 365,000
Investment and other 4,381,300 - 4,381,300
Total revenues 94,117,500 143,937 94,261,437
Expenditures-
Current-
General government 22,479,783 (2,538,162) 19,941,621
Public safety 45,402,718 1,992,979 47,395,697
Public works 15,608,723 (3,090,855) 12,517,868
Culture and recreation 13,620,710 642,802 14,263,512
Total expenditures 97,111,934 (2,993,236) 94,118,698
Excess(deficiency)of revenues
over expenditures (2,994,434) 3,137,173 142,739
Other financing sources (uses)-
Transfers in 3,355,800 - 3,355,800
Transfers out (9,600,000) (3,125,000) (12,725,000)
Total other financing sources(uses) (6,244,200) (3,125,000) (9,369,200)
Net change in fund balances $ (9,238,634) $ 12,173 $ (9,226,461)
B. ENCUMBRANCES
Encumbrances represent commitments related to unperformed(executory)contracts for goods or services.
For budgetary purposes, encumbrances lapse at fiscal year-end. In accordance with the City Charter, Part
I,Article 8, Section 8.03 (a)(10)—Finance Administration, a capital improvement program may be revised
and extended each year to indicate capital improvements pending or in process of construction or
acquisition. Therefore, purchase orders and contracts associated with capital improvement programs roll
at the end of the fiscal-year. The following page summarizes the encumbrances and significant
commitments at September 30, 2017 associated with capital improvements.
68
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
II. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY (CONTINUED)
B. ENCUMBRANCES (CONTINUED)
Major Funds
Round Rock Transportation and Economic
Development Corporation Fund $ 8,524,000
Self-Financed Construction Fund $ 2,777,000
2014&2017 General Obligation Bonds Fund $ 13,702,000
Nonmajor Funds
Capital projects funds $ 728,000
Special revenue funds $ 125,000
III. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL
STATEMENTS
A. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL
FUNDS BALANCE SHEET AND THE GOVERNMENT-WIDE STATEMENT OF NET
POSITION
The governmental fund balance sheet includes a reconciliation between fitnd balance-total governmental
fitnds and netposition-governmental activities as reported in the government-wide statement of net position.
One element of that reconciliation explains that"long-term liabilities,including bonds payable,are not due
and payable in the current period and therefore are not reported in the funds."The details of this difference
are as follows:
Bonds payable $ 226,14500
Plus: Issuance premium(amortized against interest expense) 16,520,459
Less: Issuance discount(amortized against interest expense) (102,069)
Capital leases payable 3,844,223
Net pension liability 39,486,545
Compensated absences 6,991,784
Other post-employment benefits 3,741,147
Net adjustment to reduce fitnd balance-total governmentalfunds
to arrive at net position-governmental activities $ 296,627,089
69
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
III. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL
STATEMENTS (CONTINUED)
B. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL
FUNDS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND
BALANCES AND THE GOVERNMENT-WIDE STATEMENT OF ACTIVITIES
The governmental fund statement of revenues, expenditures, and changes in fund balances includes a
reconciliation of net changes in fund balances —total governmental funds to changes in net position of
governmental activities as reported in the government-wide statement of activities. One element of that
reconciliation explains that "Governmental funds report capital outlays as expenditures. However, in the
statement of activities the cost of those assets is allocated over their estimated useful lives and reported as
depreciation expense."The details of this difference are as follows:
Capital outlay $ 90,020,515
Depreciation expense (31,546,013)
Net adjustment to increase net changes in fund balances-
total governmentalfunds to arrive at changes in net position
of governmental activities $ 58,474,502
Another element of the reconciliation states that "The net effect of various miscellaneous transactions
involving capital assets(i.e. sales,disposals,and donations)is to increase net position." The details of this
difference are as follows:
Donations $ 3,278,582
Reclassifications, disposals, and transfers (51,670)
Net adjustment to increase net changes in fitnd balances-total
governmental ficnds to arrive at changes in net position of
governmental activities $ 3,226,912
Another element of the reconciliation states that "The issuance of long-term debt (e.g. bonds, leases)
provides current financial resources to governmental funds, while the repayment of the principal of long-
term debt consumes the current financial resources of governmental funds. Neither transaction, however,
has any effect on net position. Also, governmental funds report the effect of issuance costs, premiums,
discounts,and similar items when debt is first issued,whereas these amounts are deferred and amortized in
the statement of activities." The details of this difference are as follows:
Issuance of debt $ (38,725,000)
Premiums received on issuance of debt (2,652,531)
Deferred amount on refunding 141,564
Debt payments/refundings 22,242,387
Capital lease payments 901,806
Net adjustment to decrease net changes in fitnd balances-
total governmental funds to arrive at changes in net position
of governmental activities $ (18,091,774)
70
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
III. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL
STATEMENTS (CONTINUED)
B. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL
FUNDS STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND
BALANCES AND THE GOVERNMENT-WIDE STATEMENT OF ACTIVITIES
(CONTINUED)
Another element of the reconciliation states that"Some expenses reported in the statement of activities do
not require the use of current financial resources and therefore are not reported as expenditures in
governmental funds." The details of these differences are as follows:
Increase in net pension obligation $ (1,249,361)
Deferred net actuarial gain (1,644,054)
Increase in deferred pension premiums 557,332
Net adjustment to decrease net changes in fund balances-total
governmental ficnds to arrive at changes in net position of
governmental activities $ (2,336,083)
Increase in OPEB liability $ (540,056)
Change in compensated absences 511
Amortization of bond premium/discount 1,207,229
Change in accrued interest (215,072)
Amortization of deferred amount on refunding (708,896)
Net adjustment to decrease net changes in fitnd balances-total
governmental funds to arrive at changes in net position of
governmental activities $ (256,284)
IV. DETAILED NOTES ON ALL FUNDS
A. CASH AND INVESTMENTS
At September 30, 2017, the carrying amount of deposits was a debit balance of$50,835,431, including
$2,453,204 in outstanding checks, and the respective bank balances totaled$53,288,635. The City's bank
balances were fully insured or collateralized with securities held by the City's agent in the City's name.
Investments—
All investments are presented at fair value. The fair value of U.S. Government Securities is based upon
discounted future cash flows. The fair value of the positions in the state investment pools is the same as
the value of the pool shares. The change in the fair value of investments during the year ended
September 30,2017 is as follows:
Fair value at September 30,2017 $ 260,774,329
Add: Proceeds of investments matured this fiscal year 252,992,501
Less: Cost of investments purchased this fiscal year (238,467,494)
Less: Fair value at September 30, 2016 (277,854,794)
Change in fair value of investments $ (2,555,458)
71
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
A. CASH AND INVESTMENTS(CONTINUED)
Reconciliation of cash and investments to the statement of net position amounts for cash and cash
equivalents and investments is as follows:
Cash in banks $ 50,835,431
Investments 260,774,329
Total cash and investments $ 311,609,760
Statement of net position presentation:
Cash and cash equivalents $ 20,855,770
Investments 182,014,317
Restricted assets-
Cash and cash equivalents 23,740,679
Investments 84,998,994
Total cash and cash equivalents and investments $ 311,609,760
Following Statement No. 72, "Fair Value Measurement and Application, the City categorizes its fair value
measurements within the hierarchy established by generally accepted accounting principles. The hierarchy
is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices
in active markets for identical assets; Level 2 inputs are significant other observable inputs; and Level 3
inputs are significant unobservable inputs. As of September 30, 2017,the City has the recurring fair value
measurements for U.S. Government securities of$20,312,407 valued using quoted prices for similar assets
in active markets(level 2 inputs).
Weighted
Average
Carrying Fair Maturity
Amount Value (Days)
U. S. Government Securities $ 20,312,407 $ 20,312,407 286
Certificates of Deposit 211,715,905 211,715,905 307
State Investment Pools 28,746,017 28,746,017 37
$ 260,774,329 $ 260,774,329
Portfolio weighted average maturity 272
In accordance with its investment policy, the City manages its interest rate risk by limiting the weighted
average maturity of its portfolio to less than 540 days. The City's state investment pool investments are
not subject to limitations, penalties, or restrictions on withdrawals.
Legal and Contractual Provisions Governing Deposits and Investments
The Public Funds Investment Act(PFIA)(Government Code Chapter 2256)contains specific provisions
72
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
A. CASH AND INVESTMENTS (CONTINUED)
in the areas of investment practices,management reports and establishment of appropriate policies. Among
other things, it requires the City to adopt,implement,and publicize an investment policy. That policy must
address the following areas: (1)safety of principal and liquidity, (2)portfolio diversification,(3)allowable
investments,(4)acceptable risk levels,(5)expected rates of return,(6)maximum allowable stated maturity
of portfolio investments, (7) maximum average dollar-weighted maturity allowed based on the stated
maturity date for the portfolio, (8) investment staff quality and capabilities, and (9) bid solicitation
preferences for certificates of deposit. Statutes authorize the City to invest in (1) obligations of the U.S.
Treasury, certain U.S. agencies, and the State of Texas, (2) certificates of deposit, (3) certain municipal
securities, (4) money market savings accounts, (5) repurchase agreements, (6) banker's acceptances, (7)
mutual funds,(8)investment pools,(9)guaranteed investment contracts,and(10)common trust funds. The
Act also requires the City to have independent auditors perform test procedures related to investment
practices as provided by the Act. The City is in substantial compliance with the requirements of the Act
and with local policies.
In addition,the funds of the City must be deposited and invested under the terms of a contract, contents of
which are set out in the Depository Contract Law. The depository bank places approved pledged
securities for safekeeping and trust with the City's agent bank in an amount sufficient to protect City funds
on a day-to-day basis during the period of the contract. The pledge of approved securities is waived only
to the extent of the depository bank's dollar amount of Federal Deposit Insurance Corporation (FDIC)
insurance and any letters of credit that are pledged.
Policies Governing Deposits and Investments
1. Foreign Currency Risk—The City's deposits and investments are not exposed to foreign currency risk.
2. Custodial Credit Risk—The City's policy is to be collateralized. The City was fully collateralized during
the year.
3. Interest Rate Risk—In compliance with the City's Investment Policy,as of September 30,2017,the City
minimized its interest rate risk in the portfolio by:
a) Limiting the weighted average maturity to 540 days;
b) Structuring the portfolio so that maturities meet cash requirements for ongoing operations,
thereby avoiding the need to sell securities on the secondary market prior to maturity;
c) Monitoring credit ratings of portfolio positions to assure compliance with rating requirements
imposed by PFIA; and
d) Investing operating funds primarily in short-term securities, money market mutual funds,
money market accounts,or government investment pools.
4. Credit Risk — In compliance with the City's Investment Policy, as of September 30, 2017, the City
minimized credit risk losses due to default of security issuer or backer by:
a) Limiting investments to the safest rated securities. All the City's purchased investments in
U. S.Agencies were rated AA+and Aaa by Standard&Poor's and Moody's respectively;
73
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
A. CASH AND INVESTMENTS(CONTINUED)
b) Using a registered investment advisor to provide investment and market advice; and
c) Diversifying the investment portfolio so that potential losses on individual securities were
minimized.
5. Concentration Risk—The City invests in pools, certificates of deposit, money market funds, municipal
bonds and U. S. Government Securities. State law authorizes the City to invest in obligations of the
United States government and its agencies, commercial paper, money market funds, certificates of
deposit of any state or federally chartered bank,obligations of states,agencies,counties,cities and other
political subdivisions of any state not rated less than A or equivalent. All investments made in 2017
were in the aforementioned categories.
Local Government Investment Pools
As of September 30, 2017, the City's investments included TexPool, TexSTAR, and Texas Term
TexasDAILY Investment Pools. The investment pools' investments are not evidenced by securities that
exist in physical or book entry form and, accordingly, do not have custodial risk. At September 30, 2017,
$23,503,699 was invested in TexPool, $191,213 was invested in TexSTAR, and $5,051,105 in
TexasDAILY.
TexPool policies require that local government deposits be used to purchase investments authorized by the
Public Funds Investment Act(PFIA)of 1987,as amended. The Texas State Comptroller of Public Accounts
has oversight responsibility for TexPool. TexPool is a public funds investment pool created by the Texas
Treasury Safekeeping Trust Company (Trust Company)to provide a safe environment for the placement
of local government funds in authorized short-term, fully collateralized investments, including direct
obligations or, or obligations guaranteed by,the United States or State of Texas or their agencies;federally
insured certificates of deposit issued by Texas banks or savings and loans; and fully collateralized direct
repurchase agreements secured by United States Government agency securities and placed through a
primary government securities dealer.
The Trust Company was incorporated by the State Treasurer by authority of the Texas Legislature as a
special purpose trust company with direct access to the services of the Federal Reserve Bank to manage,
disburse,transfer,safe keep,and invest public funds and securities more efficiently and economically. The
State Comptroller of Public Accounts exercises oversight responsibility over TexPool. Oversight includes
the ability to significantly influence operations, designation of management, and accountability for fiscal
matters. TexPool uses amortized cost rather than fair value to report net position to compute share prices.
The fair value of the position in TexPool is the same as the value of TexPool shares. Accordingly, the
City's investments in TexPool are stated at cost,which approximates fair value. TexPool is currently rated
AAAm by Standard and Poor's. This rating indicates excellent safety and superior capacity to maintain
principal value and limit exposure to loss.
Texas Short Term Asset Reserve program(TexSTAR)is a local government investment cooperative created
74
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
A. CASH AND INVESTMENTS(CONTINUED)
under the Interlocal Cooperation Act, Chapter 791 of the Texas Government Code and the PFIA,
specifically tailored to meet state and local government investment objectives of preservation of principal,
daily liquidity and competitive yield. The fund maintains a maturity of 60 days or less, with a maximum
of 13 months for any individual security. The fund seeks to maintain a constant dollar objective and fulfills
all requirements of Texas PFIA for local government investment pools.
TexSTAR is co-administered by J.P. Morgan Investment Management Inc. and Hilltop Securities Inc. and
is overseen by a five-member government board made up of three participants and one of each of the
program's co-administrator or an affiliate. The responsibility of the board includes the ability to influence
operations, designation of management, and accountability for fiscal matters. In addition, the pool has a
Participant Advisory Board which provides input and feedback on the operations and direction of the
program and Standard and Poor's reviews the pool on a weekly basis to ensure the pool's compliance with
its rating requirements. TexSTAR uses amortized cost(which excludes unrealized gains and losses)rather
than fair value to report net assets to compute share price. The fair value of the City's position in TexSTAR
is the same as the value of TexSTAR shares.
TexasTERM Local Government Investment Pool (the "Pool") was established by the TexasTERM
Common Investment Contract, in conformity with Chapters 791 (Interlocal Cooperation Act) and 2256
(Public Funds Investment Act)of the Texas Government Code. An elected Advisory Board is responsible
for the overall management of the Pool, including formation and implementation of its investment and
operating policies. The Pool is a non-taxable investment fund established for local governments. The Pool
has not provided or obtained any legally binding guarantees to support the value of shares.All participation
in the Pool is voluntary. The Pool is not required to register with the Securities and Exchange Commission
(SEC)as an investment company.
The Pool's investment advisor and administrator is PFM Asset Management,LLC.The Pool offers a series
of professionally managed portfolios that are available to government entities in the State of Texas. One of
these portfolios, TexasDAILY, is a money market portfolio with daily liquidity that is rated AAAm by
Standard& Poor's. TexasDAILY's investment objectives are to provide shareholders with as high a level
of current income as is consistent with stability, safety of principal, and liquidity, and to maintain a stable
net asset value (NAV) of$1.00 per share. TexasDAILY is designed as an investment vehicle for bond
proceeds and operating funds of municipalities located in Texas. PFM Fund Distributors, Inc., a wholly-
owned subsidiary of PFM Asset Management LLC, serves as the fund's distributor.
In accordance with GASB Statement No. 79, Certain External Investment Pools and Pool Participants,the
Local Government Investment Pools do not have any limitations and restrictions on withdrawals such as
notice periods or maximum transaction amounts. These pools do not impose any liquidity fees or
redemption gates.
B. PROPERTY TAXES AND RECEIVABLES
Property taxes attach as an enforceable lien on January 1. Taxes are levied on or about October 1, are due
on November 1, and are past due the following February 1. The Williamson and Travis Central Appraisal
Districts established appraisal values in accordance with requirements of the Texas Legislature.
75
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
B. PROPERTY TAXES AND RECEIVABLES(CONTINUED)
The City Council levies taxes based upon the appraised values. Williamson County and Travis County
bills and collects the City's property taxes.
The property tax rates, established in accordance with state law, were based on 100% of the net assessed
valuation of real and personal property within the City on the 2016 tax roll. The tax rate, based on total
taxable assessed valuation of$11,327,175,854 was$0.425000 on each$100 valuation and was allocated to
the General Fund and Debt Service Fund at$0.271870 and$0.153130,respectively.
General Debt Service
Fund Fund Total
Current year levy $ 97,259 $ 47,903 $ 145,162
Prior years' levies 187,951 112,210 300,161
285,210 160,113 455,323
Less-allowance for uncollectible taxes (2,852) (1,601) (4,453)
$ 282,358 $ 158,512 $ 440,870
Allowances for uncollectible taxes are based upon historical experience in collecting property taxes. The
City is prohibited from writing off real property taxes without specific statutory authority from the Texas
Legislature.
C. INTERFUND,RECEIVABLES,PAYABLES AND TRANSFERS
Interfund receivables and payables as of September 30, 2017 were as follows:
Receivable Fund Payable Fund Receivable Payable
Debt Service Fund General Fund $ 7,530 $ 7,530
Nonmajor Governmental Funds General Fund 76,032 76,032
Governmental Funds $ 83,562 $ 83,562
Remaining balances resulted from the time lag between the dates that(1) interfund goods and services are
provided or reimbursable expenditures occur, (2)transactions are recorded in the accounting system, and
(3)payments between funds are made.
The City reports interfund transfers between many of its funds. These routine transfers are consistent with
the activities of the funds.
Transfers are used to(1)move revenues from the fund that statute or budget requires to collect them to the
fund that statute or budget requires to expend them, (2) move receipts restricted to debt service from the
funds collecting the receipts to the debt service fund as debt service payments become due, and(3)use
76
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
C. INTERFUND,RECEIVABLES,PAYABLES AND TRANSFERS(CONTINUED)
unrestricted revenues collected in the general fund to finance various programs accounted for in other funds
in accordance with budgetary authorizations. A summary of transfers between funds is shown below.
Governmental Funds Transfers In Transfers Out
General Fund-
Water and Sewer Fund $ 3,355,800 $ -
Self-Financed Construction Fund - 12,310,834
Nonmajor Governmental Funds - 350,100
3,355,800 12,660,934
Debt Service Fund-
Round Rock Transportation and Economic Development Corporation Fund 4,020,198 -
Nonmajor Governmental Funds 873,481 -
4,893,679 -
Round Rock Transportation and Economic Development Corporation Fund-
Self-Financed Construction Fund 125,000 -
Nonmajor Governmental Funds 709,829 -
Debt Service Fund - 4,020,198
834,829 4,020,198
Self-Financed Construction Fund-
General Fund 12,310,834 -
Golf Course Fund - 427,603
Water and Sewer Fund 564,674 -
Nonmajor Governmental Funds 2,754 125,000
12,878,262 552,603
2014 and 2017 General Obligation Bonds Fund-
Nonmajor Governmental Funds 1,800 -
1,800 -
Other Governmental Funds-
Nonmajor Governmental Funds 9,944,100 11,181,864
9,944,100 11,181,864
Subtotal of Governmental Funds 31,908,470 28,415,599
Proprietary Funds
Water and Sewer Fund-
General Fund - 3,355,800
Self-Financed Construction Fund - 564,674
3,920,474
Golf Course Fund-
Self-Financed Construction Fund 427,603 -
427,603 -
Subtotal of Proprietary Funds 427,603 3,920,474
Total Transfers $ 32,336,073 $ 32,336,073
77
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
D. JOINT VENTURE
The City entered into a partnership with the cities of Leander and Cedar Park and formed Brushy Creek
Regional Utility Authority(BCRUA). The BCRUA has the responsibility to provide reliable,cost effective
sources of water. The City accounts for this partnership as a joint venture. Condensed financial statements
for BCRUA are shown below. Financial statements may be obtained at the BCRUA,221 East Main Street,
Round Rock,Texas, 78664.
STATEMENT OF NET POSITION
As of September 30,2017
Total City's Interest
ASSETS
Cash and cash equivalents $ 5,660,423 $ 3,024,681
Receivables,other current assets 89,553 7,072
Restricted investments 18,325,661 11,239,924
Capital assets 159,364,214 57,537,008
Total Assets 183,439,851 71,808,685
Deferred outflows of resources 15,558,001 6,062,490
LIABILITIES
Accounts payable 865,626 64,654
Retainage payable 1,595,370 546,199
Accrued bond interest payable 1,044,503 373,036
Total current liabilities 3,505,499 983,889
Bonds payable 174,172,705 64,260,884
Total Liabilities 177,678,204 65,244,773
NET POSITION $ 21,319,648 $ 12,626,402
STATEMENT OF ACTIVITIES AND CHANGES IN NET POSITION
For the Year Ended September 30,2017
Total City's Interest
Operating revenues $ 2,302,665 $ 375,370
Interest expense (6,032,788) (2,280,806)
Other operating expenses (5,722,504) (1,680,693)
Other income(expenses) (495,484) 132,309
Changes in Net Position (9,948,111) (3,453,820)
Net position, October 1, 2016 19,471,253 12,202,372
Contribution of capital, net 11,796,506 3,877,850
Net position, September 30, 2017 $ 21,319,648 $ 12,626,402
78
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
E. CAPITAL ASSETS
Capital asset activity for the year ended September 30,2017 was as follows:
October 1, Additions/ Retirements/ September 30,
2016 Completions Adjustments 2017
Governmental Activities:
Capital assets not being depreciated:
Land $ 53,133,747 $ 29,783,667 $ (461,300) $ 82,456,114
Construction in progress 59,653,890 58,042,594 (77,043,635) 40,652,849
Total capital assets not being depreciated 112,787,637 87,826,261 77,504,935) 123,108,963
Capital assets being depreciated:
Buildings and improvements 728,697,300 73,168,922 (200,936) 801,665,286
Equipment 73,386,255 9,808,848 (1,957,729) 81,237,374
Total capital assets being depreciated 802,083,555 82,977,770 (2,158,665) 882,902,660
Less accumulated depreciation for:
Buildings and improvements 367,467,741 24,469,699 (168,523) 391,768,917
Equipment 55,175,213 7,076,314 (1,938,472) 60,313,055
Total accumulated depreciation 422,642,954 31,546,013 (2,106,995) 452,081,972
Total capital assets being depreciated,net 379,440,601 51,431,757 (51,670) 430,820,688
Governmental activities capital assets,net $ 492,228,238 $ 139,258,018 $ (77,556,605) $ 553,929,651
Business-Type activities:
Capital assets not being depreciated:
Land $ 8,452,956 $ - $ - $ 8,452,956
Construction in progress 12,562,302 4,469,572 (12,761,004) 4,270,870
Total capital assets not being depreciated 21,015,258 4,469,572 (12,761,004) 12,723,826
Capital assets being depreciated:
Buildings and improvements 459,703,327 16,596,655 (19,219) 476,280,763
Equipment 16,012,631 4,660,827 (813,609) 19,859,849
Total capital assets being depreciated 475,715,958 21,257,482 (832,828) 496,140,612
Less accumulated depreciation for:
Building and improvements 160,160,972 14,673,593 - 174,834,565
Equipment 12,224,356 1,819,445 (813,580) 13,230,221
Total accumulated depreciation 172,385,328 16,493,038 (813,580) 188,064,786
Total capital assets being depreciated,net 303,330,630 4,764,444 (19,248) 308,075,826
Business-type activities capital assets,net $ 324,345,888 $ 9,234,016 $ (12,780,252) $ 320,799,652
79
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
E. CAPITAL ASSETS(CONTINUED)
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental Activities:
General government $ 2,436,302
Public safety 3,467,235
Public works 19,630,724
Culture and recreation 6,011,752
Total depreciation expense—governmental activities $ 31,546,013
Business-Type Activities:
Water and sewer utility $ 16,373,517
Golf course 119,521
Total depreciation expense—business-type activities $ 16,493,038
Net Investment in Capital Assets
Detailed reconciliation of net investment in capital assets on the Government-wide Statement of Net
Position for September 30, 2017 follows:
Governmental Business-Type
Activities Activities Total
Net investment in capital assets:
Total capital assets(net of
accumulated depreciation) $ 553,929,651 $ 320,799,652 $ 874,729,303
Plus capital-related deferred
outflows of resources 5,985,503 4,406,750 10,392,253
Less long-term debt (246,407,611) (86,027,433) (332,435,044)
Plus unspent bond proceeds 432078,882 5,826,075 48,904,957
Net investment in capital assets
(net of related debt) $ 356,586,425 $ 245,005,044 $ 601,591,469
80
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
F. LONG-TERM DEBT
The following is a summary of long-term debt transactions, including current portion, of the City for the
year ended September 30, 2017:
Balance Balance
October 1, Refundings/ September 30, Due within
2016 Additions Retirements 2017 one year
Governmental Activities
General obligation bonds $ 149,540,000 $ 28,585,000 $ (7,510,000) $ 170,615,000 $ 7,795,000
Certificates of obligation 27,095,000 - (780,000) 26,315,000 795,000
Hotel tax revenue bonds 12,320,000 - (645,000) 11,675,000 620,000
Sales tax revenue bonds 9,180,000 10,140,000 (1,780,000) 17,540,000 3,615,000
State infrastructure bank loans 11,527,387 - (11,527,387) - -
Plus deferred amount:
For issuance premium 15,088,834 2,652,531 (1,220,906) 16,520,459 1,291,642
For issuance discount (115,748) - 13,679 (102,069) (13,679)
Lease purchase payable 4,746,029 - (901,806) 3,844,223 1,135,381
Net pension liability 38,237,184 1,249,361 - 39,486,545 -
Compensated absences 6,992,295 4,040,206 (4,040,717) 6,991,784 4,684,495
Other post-employment benefits 3,201,091 970,358 (430,302) 3,741,147 -
Total governmental activities 277,812,072 47,637,456 (28,822,439) 296,627,089 19,922,839
Business-Type Activities
Revenue bonds 84,675,000 - (3,105,000) 81,570,000 3,190,000
Plus deferred amount:
For issuance premium 4,689,624 - (232,191) 4,457,433 232,191
Net pension liability 5,214,162 170,367 - 5,384,529 -
Compensated absences 529,023 568,613 (505,121) 592,515 468,087
Other post-employment benefits 406,642 132,322 (58,678) 480,286 -
Total business-type activities 95,514,451 871,302 (3,900,990) 92,484,763 3,890,278
Total government $ 373,326,523 $ 48,508,758 $(32,723,429) $ 389,111,852 $ 23,813,117
The General Fund and Hotel/Motel Fund are responsible for liquidating the liability for compensated
absences and other post-employment benefits in the governmental activities and the Water and Sewer Fund
and Drainage Fund are responsible for liquidating the liability for compensated absences and other post-
employment benefits in the business-type activities.
81
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
F. LONG-TERM DEBT(CONTINUED)
Long-term debt at September 30,2017 is comprised of the following:
Business-
Governmental Type
Activities Activities
General Obligation Bonds:
$ 18,575,000 2010 refunding bonds due in annual installments
of$ 140,000 to $ 1,940,000 through 2027; interest at 2.0%to 4.0% $ 16,360,000 $ -
$ 19,580,000 2011 refunding bonds due in annual installments
of$405,000 to $ 1,885,000 through 2027; interest at 2.0%to 4.0% 12,100,000 -
$ 8,615,000 2013 refunding bonds due in annual installments
of$455,000 to $ 925,000 through 2024; interest at 1.00%to 1.65% 5,020,000 -
$ 10,465,000 2014A GO and refunding bonds due in annual installments
of$270,000 to$ 1,740,000 through 2021; interest at 2.0%to 5.0% 5,595,000 -
$66,885,000 2014 GO and refunding bonds due in annual installments
of$-0-to $4,790,000 through 2038; interest at 3.0%to 5.0% 66,8855000 -
$32,465,000 2015 refunding bonds due in annual installments
of$-0-to $3,445,000 through 2032; interest at 4.0%to 5.0% 29,740,000 -
$6,995,000 2016 refunding bonds due in annual installments
of$-0-to $755,000 through 2032; interest at 2.0%to 4.0% 6,330,000 -
$28,585,000 2017 GO bonds due in annual installments
of$-0-to $ 1,945,000 through 2042; interest at 3.0%to 5.0% 28,585,000 -
Total General Obligation Bonds 170,615,000 -
Certificates of Obligation:
$27,270,000 2014 Combination tax and revenue certificates of
obligation due in installments of$ 175,000 to$ 1,700,000
through 2039; interest at 2.0%to 4.0% 26,315,000 -
Total Certificates of Obligation 26,315,000 -
Hotel Tax Revenue Bonds:
$ 7,715,000 2012 venue tax and hotel bonds due in annual installments of
$ 110,000 to $ 590,000 through 2038; interest at 2.0%to 4.0% 7,250,000 -
$4,455,000 2016 refunding bonds due in annual installments of
$ 30,000 to $630,000 through 2025; interest at 2.0%to 4.0% 4,425,000 -
Total Hotel Tax Revenue Bonds 11,675,000 -
Sales Tax Revenue Bonds:
$ 105930,000 2015 refunding bonds due in annual installments of
$ 1.75 to$ 1.89 million through 2021 including interest at 1.56% 7,400,000 -
$ 10,140,000 2017 refunding bonds due in annual installments of
$ 1.32 to$ 1.92 million through 2023 including interest at 1.78% 10,140,000 -
Total Sales Tax Revenue Bonds 179540,000 -
82
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
F. LONG-TERM DEBT(CONTINUED)
Business-
Governmental Type
Activities Activities
Utility System Revenue Bonds:
$ 12,000,000 2006 bonds due in annual installments of
$365,000 to$ 835,000 through 2026; interest at 2.20%to 2.95% - 6,740,000
$78,785,000 2009 bonds due in annual installments of
$645,000 to $4,455,000 through 2039; interest at 2.0%to 5.0% - 32,440,000
$8,000,000 2014 bonds due in annual installments of
$-0-to $ 585,000 through 2034; interest at 2.0%to 4.0% - 7,360,000
$35,185,000 2016 bonds due in annual installments of
$ 155,000 to $3,400,000 through 2035; interest at 2.0%to 5.0% - 35,030,000
Total Utility System Revenue Bonds - 81,570,000
Issuance premium 16,520,459 4,457,433
Issuance discount (102,069) -
Lease purchases payable:
$ 5,700,000 leases due in semi-annual installments including interest
ranging from 1.02%- 1.619%due in 2022. The lease obligation
is funded with general revenue sources. 3,844,223 -
Net pension liability 39,486,545 5,384,529
Compensated absences 6,991,784 592,515
Other post-employment benefits 3,741,147 480,286
Total Primary Government Debt $ 296,627,089 $ 92,484,763
The annual requirements to amortize bonded, certificates of obligation, loan and lease debt at
September 30, 2017, including interest are as follows:
Governmental Activities:
Year Ending September 30, General and Certificates of Obligation Debt
Principal Interest Total
2018 $ 8,590,000 $ 8,524,930 $ 17,114,930
2019 10,875,000 7,958,566 18,833,566
2020 11,275,000 7,561,666 18,836,666
2021 10,580,000 7,088,944 17,668,944
2022 11,105,000 6,665,925 17,770,925
2023-2027 50,870,000 26,366,006 77,236,006
2028-2032 36,930,000 16,891,144 53,821,144
2033-2037 34,980,000 8,947,263 43,927,263
2038-2042 21,725,000 1,909,606 23,634,606
$ 196,930,000 $ 91,914,050 $ 288,844,050
83
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
F. LONG-TERM DEBT(CONTINUED)
Governmental Activities:
Year Ending September 30, Hotel Tax Revenue
Principal Interest Total
2018 $ 620,000 $ 397,830 $ 1,017,830
2019 630,000 382,805 1,012,805
2020 645,000 364,955 1,009,955
2021 665,000 343,280 1,008,280
2022 690,000 317,505 1,007,505
2023-2027 3,030,000 1,201,775 4,231,775
2028-2032 2,185,000 815,685 3,000,685
2033-2037 2,620,000 388,200 3,008,200
2038-2042 590,000 11,800 601,800
$ 11,675,000 $ 4,223,835 $ 15,898,835
Year Ending September 30, Sales Tax Revenue
Principal Interest Total
2018 $ 3,615,000 $ 315,485 $ 3,930,485
2019 3,700,000 235,567 3,935,567
2020 3,750,000 173,755 3,923,755
2021 3,810,000 111,097 3,921,097
2022 1,320,000 47,437 1,367,437
2023-2027 1,345,000 23,941 1,368,941
$ 17,540,000 $ 907,282 $ 18,447,282
Year Ending September 30, Lease Purchases
Principal Interest Total
2018 $ 1,135,381 $ 51,552 $ 1,186,933
2019 1,152,270 34,663 1,186,933
2020 865,905 18,679 884,584
2021 458,923 7,636 466,559
2022 231,744 1,535 233,279
$ 3,844,223 $ 114,065 $ 3,958,288
84
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
F. LONG-TERM DEBT(CONTINUED)
Business-Type Activities:
Year Ending September 30, Utility System Revenue Bonds
Principal Interest Total
2018 $ 3,190,000 $ 3,153,554 $ 6,343,554
2019 3,295,000 3,038,199 6,333,199
2020 3,415,000 2,897,619 6,312,619
2021 3,555,000 2,747,831 6,302,831
2022 3,675,000 2,614,694 6,289,694
2023-2027 18,980,000 10,958,184 29,938,184
2028-2032 17,915,000 7,910,619 25,825,619
2033-2037 18,845,000 4,810,550 23,655,550
2038-2042 8,700,000 657,750 9,357,750
$ 81,570,000 $ 38,789,000 $ 120,359,000
In prior years, the City defeased certain revenue and general obligation bonds by placing the proceeds of
new bonds in an irrevocable trust to provide all future debt service payments on the old bonds. Accordingly,
the trust account assets and the liability for the defeased bonds are not included in the City's financial
statements. At September 30,2017,there are no bonds outstanding which have been reported as defeased.
Bond ordinances also provide for other limitations and restrictions. The City is in compliance with all
significant limitations and restrictions contained in the various bond ordinances.
In November 2013,the voters authorized the issuance of general obligation bonds to fund capital assets of
the general government. The full faith and credit of the City as well as the City's ad valorem taxing authority
back general obligation bonds.
Date Amount Amount Unissued
Purpose Authorized Authorized Issued(*) Balance
Fire Department 11/5/2013 $ 16,500,000 $ 16,500,000 $ -
Parks& Recreation 11/5/2013 56,500,000 56,500,000 -
Library 11/5/2013 23,200,000 1,500,000 21,700,000
Police&Fire 11/5/2013 27,400,000 27,400,000 -
$ 123,600,000 $ 101,900,000 $ 21,700,000
(*)"Amount issued"column is adjusted pursuant to rules used by the Texas Attorney General.
The City may incur non-voted debt payments from or secured by its levy and collection of ad valorem taxes
and other sources of revenue,including tax notes,public property finance contractual obligations,and leases
for various purposes.
85
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
F. LONG-TERM DEBT (CONTINUED)
(1) UTILITY REVENUE BONDS
Utility revenue bonds are used to finance the acquisition and construction of major capital improvements
to the City's water and sewer systems. The City is required by bond ordinances to pledge the net revenues
of the waterworks and sewer system for the retirement of its outstanding revenue bonds, including interest
thereon, and is required for such purposes to maintain debt service funds and bond reserve funds for all
outstanding revenue bonds.
The debt service funds are restricted within the Enterprise Fund and require that net revenues of the City's
waterworks and sewer system, after operating and maintenance expenses are deducted, be irrevocably
pledged by providing equal monthly installments which will accumulate to the semi-annual principal and
interest requirements as they become due. For fiscal year 2017, net revenues available for debt service
were 3.88 times the average annual debt service requirement.
The bond reserve funds for revenue bond retirement are also restricted within the Enterprise Fund. The
City is in compliance with the requirement to maintain a combined reserve fund containing cash and
investments in an amount equal to the average annual principal and interest requirements of all bonds then
outstanding. The City also covenants under the bond indentures that reserve funds shall be invested in time
deposits, certificates of deposit and direct or guaranteed obligations of the United States of America.
(2) HOTEL TAX REVENUE BONDS
Hotel occupancy tax revenue bonds were issued to fund the City's portion of the convention center complex.
The debt service fund for the hotel tax revenue bonds, aggregating $703,624 at September 30, 2017, is
reported in the governmental funds. Bond covenants require that the hotel tax revenues be irrevocably
pledged by providing quarterly installments, which will accumulate to the semi-annual principal and
interest requirements as they become due.
The bond reserve fund for hotel tax revenue bond retirement aggregates $816,630 at September 30, 2017.
This amount is in compliance with the requirements contained in the bond's Indenture Agreement. This
agreement requires '/z of the average annual debt service requirements of the bonds in the reserve fund be
deposited upon issuance of the bonds,with quarterly installments until the required reserve is attained.
(3) SALES TAX REVENUE BONDS
Sales tax revenue bonds have been issued to fund transportation improvements. The Round Rock
Transportation and Economic Development Corporation issued the sales tax revenue bonds. The
Corporation is a blended component unit of the City of Round Rock, which collects '/z of I% of the sales
tax collected by the State on its behalf. Although the Corporation is presented as a blended component
unit, none of the City's assets are pledged to payment of the bonds. The bonds are secured solely by a
pledge of the revenues of the Round Rock Transportation and Economic Development Corporation.
The debt service fund for the sales tax revenue bonds, aggregating $161,191 at September 30, 2017, is
reported in the governmental funds. Bond covenants require that the Corporation's share of the sales tax is
86
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
F. LONG-TERM DEBT(CONTINUED)
pledged as security for the bonds. The Corporation provides monthly installments that accumulate to the
semi-annual principal and interest requirements as they become due.
A reserve fund was not established for these bonds. The Corporation purchased bond insurance to provide
for payment of the principal and interest requirements in the event that pledged revenues are not sufficient.
(4) 2017 REFUNDING/ISSUANCE
In May 2017,the City issued$28,585,000 in General Obligation Bonds, Series 2017. The proceeds, along
with a reoffering premium, will be used for City fire department facilities, City park and recreational
purposes, City police and fire department training facilities and payment of costs to issue the bonds.
In July 2017,the City refunded the final portions of State Infrastructure Bank Loans. The net proceeds of
the $10,140,000 of Senior Lien Sales Tax Revenue Refunding Bonds (after payment of underwriting fees,
insurance and other issuance costs) were deposited into an escrow account and held in cash to prepay the
loan obligations. As a result,the refunded bonds are considered defeased, and the debt for these bonds has
been removed from the City's financial statements.
This refunding will reduce the total debt service payments over the next six(6)years by$544,981,and will
result in an economic gain(i.e.the difference between the present value of the debt service payments of the
refunded debt and the refunding bonds)of$600,951.
G. ACCRUED COMPENSATED ABSENCES
Changes to accrued compensated absences for the year ended September 30, 2017,were as follows:
Governmental Business-Type
Activities Activities
Balance, October 1,2016 $ 6,992,295 $ 529,023
Additions 4,040,206 568,613
Reductions (4,040,717) (505,121)
Balance, September 30,2017 $ 6,991,784 $ 592,515
Accrued compensated absences due within one year were $4,684,495 for governmental activities and
$468,087 for business-type activities. Liabilities for accrued compensated absences are funded from
general fiend revenue for the governmental activities and water and sewer fund and drainage fund program
revenues for the business-type activities.
87
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
IV. DETAILED NOTES ON ALL FUNDS (CONTINUED)
H. RESTRICTED ASSETS
The following summarizes restricted assets by purpose at September 30,2017:
Cash& Property Sales Accrued
Cash Taxes Tax Interest
Equivalents Investments Receivable Receivable Receivable
Governmental Activities:
Debt Service Fund $ 920,305 $ 2,952,191 $ 158,512 $ - $ -
Restricted by debt covenants-
Round Rock Transportation
and Economic Development
Corporation Fund 3,887,443 32,207,673 - 1,426,712 45,461
2014 and 2017 General
Obligation Bonds Fund 10,099,384 34,828,771 - - 4,976
Nonmajor capital projects funds 1,428,265 2,292,242 - - 3,236
Total Governmental Activities $ 16,335,397 $ 72,280,877 $ 158,512 $ 1,426,712 $ 53,673
Cash& Accrued
Cash Accounts Interest
Equivalents Investments Receivable Receivable
Business-Type Activities:
Water and Sewer Fund-
Impact fees $ 788,425 $ 6,532,141 $ 710,916 $ -
Construction 4,965,888 6,185,976 - -
Customer deposits 1,052,930 - - -
Revenue bond debt service 598,039 - - -
Accrued interest receivable - - - 19,337
Total Business-Type Activities $ 7,405,282 $ 12,718,117 $ 710,916 $ 19,337
V. OTHER INFORMATION
A. COMMITMENTS AND CONTINGENCIES
Tax Collections
The City has a contract with Williamson and Travis counties tax offices to collect City taxes and deposit
monies to the City's accounts. For this service, Williamson County was paid $8,854 and Travis County
was paid$528 for the fiscal year ended September 30,2017.
88
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
A. COMMITMENTS AND CONTINGENCIES(CONTINUED)
Commitments for Road Construction
The City's component unit,the Round Rock Transportation and Economic Development Corporation has
entered into various commitments with the State of Texas, Department of Transportation and neighboring
cities/counties relative to the construction of roadways.
Water Supply Agreements
On May 2, 1978,the City entered into the"Water Supply Contract"with the Brazos River Authority(BRA),
providing the City the right to purchase 6,720 acre-feet of water per year from Lake Georgetown. A new
agreement, "System Water Availability Agreement for Lake Georgetown" dated September 1, 2001,
replaced that agreement. The new agreement revised the rate methodology from a tiered system rate,
wherein rates change based upon the City's consumption, to a level system rate. For the fiscal year ended
September 30,2017,the City's cost under this contract was $483,840.
On September 12, 1991,the City entered into the"Replacement Water Supply Agreement"with the BRA,
wherein it received the right to purchase 8,134 acre-feet of water per year from Stillhouse Hollow Lake.
Rights for an additional 10,000 acre-feet of water were acquired in the November 13, 1996"System Water
Supply Agreement". These agreements were replaced with the"System Water Availability Agreement for
Stillhouse Hollow Lake" dated September 1, 2001. Under this agreement,the City purchases 18,134 acre-
feet of water per year at the new system rate. For the fiscal year ended September 30,2017,the City's cost
under this contract was $1,305,648.
Effective September 1, 2001, the City entered into a"System Water Availability Agreement for Colorado
River Basin Water" with the BRA, wherein it received reserved water rights for an additional 6,944 acre-
feet of water. Two subsequent agreements granted Round Rock rights to 13,984 additional acre-feet of
water per year from the Colorado River Basin. For the fiscal year ended September 30, 2017, the City's
cost under these contracts was $1,639,514.
Future annual charges under the Water Supply Agreements will be based upon the system rate periodically
set by the BRA.
Regional Wastewater Project
In October 1996, as part of a plan for a regional wastewater collection,treatment and disposal system,the
City and the City of Cedar Park entered into agreements with an alliance(Alliance) formed by the Brazos
River Authority (BRA) and the Lower Colorado River Authority (LCRA). In 1998, LCRA acquired the
treatment facilities of the City (these facilities were repurchased from the LCRA in 2009, as described
below). BRA contracted with the Cities to operate and maintain the regional system.
In September 2009, the Cities of Round Rock, Austin and Cedar Park entered into a Purchase Agreement
with the LCRA wherein they agreed to buy the Brushy Creek Regional Wastewater System (BCRWWS)
from the LCRA. The agreement outlined the proportional share that each city would purchase of the
89
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
A. COMMITMENTS AND CONTINGENCIES(CONTINUED)
wastewater transportation and treatment system. On December 8, 2009, the three cities purchased the
BCRWWS assets and entered into a Master Contract for the Financing, Construction, Ownership and
Operation of the BCRWWS. The Master Contract provided for the terms and conditions by which the cities
would jointly own and operate the BCRWWS.
The system currently has a total treatment capacity of 24.5 MGD which is sufficient to meet future projected
flows through 2023. The City of Round Rock's current wastewater capacity in the system is 20.1 MGD.
The BRA is contracted to provide operation of the system, for which each of the cities is invoiced relative
to their system usage. For the fiscal year ended September 30, 2017, expenditures for operation of the
regional facilities were $3,967,125.
In June,2010 the Cities of Round Rock,Austin and Cedar Park sold a share of the BCRWWS assets to the
City of Leander, and all parties entered into the Amended and Restated Master Contract for the Financing,
Construction,Ownership and Operation of the Brushy Creek Regional Wastewater System.
Other
The City is a defendant in a number of lawsuits arising principally from claims against the City for alleged
improper actions by City employees. Total damages claimed are substantial;however,it has been the City's
experience that such actions are usually dismissed or settled for amounts substantially less than the claimed
amounts. The City Attorney estimates that the potential claims against the City not covered by various
insurance policies would not materially affect the financial condition of the City.
Arbitrage Rebate
Due to requirements of the Tax Reform Act of 1986, the City annually contracts for the computations of
arbitrage rebate requirements for the City's various bond issues. At September 30, 2017, the potential
rebate was calculated at$0.
Deferred Compensation Plan
The City offers its employees a deferred compensation plan that permits them to defer a portion of their
current salary until future years. Any contributions made to the deferred compensation plan,in compliance
with Section 457 of the Internal Revenue Code, are not available to employees until termination of
employment, retirement, death or an unforeseen emergency. A third party administrator, Nationwide
Retirement Solutions, administers contributions to the plan. Effective January 1997, and in compliance
with the provisions of the IRC Section 457(g), the plan assets are in custodial accounts for the exclusive
benefit of the plans' participants and beneficiaries. In accordance with GASB Statement No. 32,the City
provides neither administrative services nor investment advice to the plans and therefore, no fiduciary
relationship exists between the City and the deferred compensation plan.
90
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
A. COMMITMENTS AND CONTINGENCIES(CONTINUED)
Tax Abatements
The City of Round Rock negotiates property tax abatement agreements, property tax rebates,and sales tax
rebates on an individual basis. Each agreement was negotiated under The Texas Property Redevelopment
and Tax Abatement Act,Chapter 312,Tax Code,V.A.T.S.as amended,allowing localities to abate property
taxes for economic development purposes which include business relocation, retention and expansion.
Property must be located within a reinvestment zone to be eligible for a tax abatement,and agreements are
limited to ten (10) years in length. The abatement value can only be to the extent its value for that year
exceeds its value for the year in which the agreement is executed. The City has an Abatement Recapture
clause in all Tax Abatement Agreements in the event that the recipient does not fulfill the requirements of
the agreement. The tax rebate program is for a period greater than 10 years, and taxes paid are reimbursed
back to the owner.
Amount of Taxes
Abated during the
Tax Abatement Program Fiscal Year
Economic Development
Property Tax $ 62,336
Tax Rebate Program
Economic Development
Property Tax 849,644
Sales Tax 6,212,331
The City has not made any commitments as part of the agreements other than to reduce taxes. The City is
not subject to any tax abatement agreements entered into by other governmental entities.
B. RISK MANAGEMENT
The City is a member of the Texas Municipal League's Intergovernmental Risk Pool(Pool). The Pool was
created for the purpose of providing coverage against risks, which are inherent in operating a political
subdivision. The City pays annual premiums to the Pool for liability, property and workers' compensation
coverage and all billed premiums upon the coverage have been paid. The City's agreement with the Pool
provides that the Pool will be self-sustaining through member premiums and will provide reinsurance
contracts through commercial companies. The Pool agrees to handle all liability, property and workers'
compensation claims and provide any defense as is necessary. The Pool makes available to the City loss
control services to assist the City in following a plan of loss control that may result in reduced losses. The
City agrees that it will cooperate in instituting any and all reasonable loss control recommendations made
by the Pool. The City has experienced no significant reductions in coverage through the Pool over the past
year. There have been no insurance settlements exceeding Pool coverage for any of the past three years.
91
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
B. RISK MANAGEMENT(CONTINUED)
Self-Funded Health Insurance Fund
The City is self-insured for medical and dental claims. The self-insurance program is maintained in the
Self-Funded Health Insurance Internal Service Fund. This program provides health benefit coverage in
accordance with a pre-approved plan that establishes coverage limits per employee per year with unlimited
health coverage benefits. The City purchases commercial insurance for claims in excess of a contractual
City liability limit.
Additionally, commercial insurance covers claims in excess of an aggregate amount for the City up to
$1,000,000 per plan year. Settled claims have not exceeded the commercial coverage in any of the past
three fiscal years. The liability is estimated based upon claims settled within the next month. An analysis
of claims activities is presented below:
Claims and
Beginning Changes in Actual Claim Balance
Fiscal Year Liability Estimates Payments at Year-End
2015 $ 605,912 $ 8,351,468 $ 8,535,401 $ 421,979
2016 $ 421,979 $ 9,625,120 $ 9,310,446 $ 736,653
2017 $ 736,653 $ 10,077,914 $ 10,067,501 $ 747,066
C. EMPLOYEE RETIREMENT PLAN
Plan Description
The City participates as one of 872 plans in the non-traditional,joint contributory, hybrid defined benefit
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'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
92
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
C. EMPLOYEE RETIREMENT PLAN(CONTINUED)
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 benefit 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.
A summary of plan provisions for the City is as follows:
Employee deposit rate 7%
Matching ratio(city to employee) 2 to 1
Years required for vesting 5
Service retirement eligibility 20 years at any age, 5 years at age 60 and above
Updated Service Credit 100%Repeating,Transfers
Annuity increase(to retirees) 70%of CPI Repeating
Employees Covered by Benefit Terms
At the December 31, 2016 valuation and measurement date,the following employees were covered by the
benefit terms:
Inactive employees or beneficiaries currently receiving benefits 268
Inactive employees entitled to but not yet receiving benefits 347
Active employees 884
Total 1,499
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 adopted 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 Non-nal (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. Since the City needs to know its
contribution rates in advance for budgetary purposes, there is a one-year delay between the actuarial
valuation that serves as the basis for the rate and the calendar year when the rate goes into effect.
Employees for the City were required to contribute 7%of their annual gross earnings during the fiscal year.
The City elected to contribute for calendar years 2016 and 2017 as follows:
2016 2017
Total Retirement Rate 15.40% 15.55%
Supplemental Death Benefit 0.13% 0.13%
Total Combined Contribution 15.53% 15.68%
93
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
C. EMPLOYEE RETIREMENT PLAN(CONTINUED)
Accordingly, contributions to TMRS for the year ended September 30, 2017, were $9,059,953, and were
equal to the required contributions.
Net Pension Liability
The City's Net Pension Liability (NPL) was measured as of December 31, 2016, and the Total Pension
Liability (TPL) used to calculate the Net Pension Liability was determined by an actuarial valuation as of
that date.
Actuarial assumptions:
The Total Pension Liability in the December 31, 2016 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-district RP2000 Combined Healthy Mortality Tables with Blue
Collar Adjustment,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
Adjustment are used with males' 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.
Actuarial assumptions used in the December 31, 2016 valuation were based on the results of actuarial
experience studies. The experience study in TMRS was for the period December 31, 2010 through
December 31,2014. Healthy post-retirement mortality rates and annuity purchase rates were updated based
on a Mortality Experience Investigation Study covering 2009 through 2011, and dated December 31,2013.
These assumptions were first used in the December 31, 2013 valuation, along with a change to the Entry
Age Normal (EAN) actuarial cost method. Assumptions are reviewed annually. No additional changes
were made for the 2014 valuation. After the Asset Allocation Study analysis and experience investigation
study, the Board amended the long-term expected rate of return on pension plan investments from 7% to
6.75%. 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
94
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
C. EMPLOYEE RETIREMENT PLAN(CONTINUED)
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). The target allocation
and best estimates of real rates of return for each major asset class in fiscal year 2017 are summarized in
the table below:
Target Long-Term Expected Real
Asset Class Allocation Rate of Return(Arithmetic)
Domestic Equity 17.5% 4.55%
International Equity 17.5% 6.35%
Core Fixed Income 10.0% 1.00%
Non-Core Fixed Income 20.0% 4.15%
Real Return 10.0% 4.15%
Real Estate 10.0% 4.75%
Absolute Return 10.0% 4.00%
Private Equity 5.0% 7.75%
Total 100.0%
Single 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.
95
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
C. EMPLOYEE RETIREMENT PLAN(CONTINUED)
Changes in the Net Pension Liability
Increase(Decrease)
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability
(a) (b) (a)-(b)
Balance at December 31,2015 $ 221,236,523 $ 177,785,177 $ 43,451,346
Changes for the year:
Service cost 9,609,823 - 9,609,823
Interest 15,065,206 - 15,065,206
Difference between expected and actual experience 704,655 - 704,655
Changes of assumptions - - -
Contributions-employer - 8,302,118 (8,302,118)
Contributions-employee - 3,779,341 (3,779,341)
Net investment income - 12,021,503 (12,021,503)
Benefit payments, including refunds of
employee contributions (5,706,408) (5,706,408) -
Administrative expense - (135,695) 135,695
Other - (7,311) 7,311
Net changes 19,673,276 18,253,548 1,419,728
Balance at December 31,2016 $ 240,909,799 $ 196,038,725 $ 44,871,074
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:
Current
1%Decrease Discount Rate 1%Increase
5.75% 6.75% 7.75%
City's net pension liability $ 84,236,772 $ 44,871,074 $ 12,985,932
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.
96
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
C. EMPLOYEE RETIREMENT PLAN(CONTINUED)
Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources
For the year ended September 30, 2017, the City recognized pension expense of $11,590,087. At
September 30, 2017, the City reported deferred outflows of resources and deferred inflows of resources
related to pensions from the following sources:
Deferred Deferred
Outflows of Inflows of
Resources Resources
Differences between expected and actual economic experience $ 592,805 $ 479,616
Difference between projected and actual investment earnings 7,844,988 16,804
Pension contributions after measurement date 7,111,989 -
Changes in actuarial assumptions used to determine pension liability - 825,174
Total $ 15,549,782 $ 1,321,594
Deferred outflows of resources related to pensions resulting from contributions subsequent to the
measurement date of$7,111,989 will be recognized as a reduction of the net pension liability for the
measurement year ending December 31, 2017 (i.e., recognized in the City's financial statements
September 30, 2018). 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 ended Outflows(Inflows)
December 31, of Resources
2017 $ 2,551,892
2018 2,551,891
2019 2,151,819
2020 (192,910)
2021 19,953
Thereafter 33,554
Total $ 7,116,199
Supplemental Death Benefits Fund
The City also participates in the cost sharing multiple-employer defined benefit group-term life insurance
plan operated by TMRS known as the Supplemental Death Benefits Fund (SDBF). The City elected, by
ordinance,to provide group-term life insurance coverage to both current and retired employees. The City
may terminate coverage under and discontinue participation in this fiend by adopting an ordinance before
November 1, of any year to be effective the following January 1.
The death benefit for active employees provides a lump-sum payment approximately equal to the
employee's annual salary(calculated based on the employee's actual earnings,for the 12-month period
97
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
C. EMPLOYEE RETIREMENT PLAN(CONTINUED)
preceding the month of death); retired employees are insured for $7,500; this coverage is an "other post-
employment benefit,"or OPEB. The City offers supplemental death benefits to both active employees and
retirees for plan years 2017 and 2016.
The City contributes to the SDBF at a contractually required rate as determined by an annual actuarial
valuation. The rate is equal to the cost of providing one-year term life insurance and represents 0.13%of
required contributions. The City's contributions to the SDBF for the years ended 2017, 2016, and 2015
were$11,778,$11,323,and$10,272,respectively,which equaled the required contributions each year. The
funding policy for the SDBF program is to assure that adequate resources are available to meet all death
benefit payments for the upcoming year; the intent is not to pre-fund retiree term life insurance during
employees' entire careers.
The City also provides basic life and accidental death and dismemberment insurance for all eligible
employees at no cost. The benefit is equal to the employee's annual base earnings up to a maximum of
$100,000. This benefit is paid out to the beneficiaries in the event of the employee's death.
D. OTHER POST-EMPLOYMENT BENEFITS
In addition to the contributions made to the pension system as previously described, the City provides a
single employer plan for certain other post-employment benefits (OPEB) to its retirees. Other post-
employment benefits include access to medical,dental,and vision insurance for the retiree and the retiree's
family.
All retirees who are eligible to receive pension benefits under the City's pension system and, for retirees,
have at least five years of service with the City at the time of their retirement are eligible for other post-
employment benefits. Retirees may also enroll eligible dependents under the medical, dental, and vision
plan(s) in which they participate. Eligible dependents of the retiree include a legally married spouse and
unmarried children dependent on the retiree for support. The children covered include children under age
26 and eligible disabled children beyond 26 years of age, if covered prior to age 26. A surviving spouse of
a deceased retiree may continue medical coverage until the date the surviving spouse remarries, or until
they are Medicare eligible. A surviving spouse of a deceased retiree may continue dental and/or vision
coverage for 36 months by paying the entire premium plus a 2 percent administrative fee. Other surviving
dependents of a deceased retiree may continue medical, dental, and/or vision coverage for 36 months by
paying the entire premium plus a 2 percent administrative fee.
The City is under no obligation, statutory or otherwise,to offer other post-employment benefits or to pay
any portion of the cost of other post-employment benefits to any retirees or their dependents. Allocation
of city funds to pay other post-employment benefits or to make other post-employment benefits available
is determined on an annual basis by the City Council as part of the budget approval process.
Group dental coverage is available to retirees and their eligible dependents. The retiree pays the full cost
of the dental premium.
98
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
D. OTHER POST-EMPLOYMENT BENEFITS(CONTINUED)
Annual OPEB Cost and Net OPEB Obligation
Other post-employment benefits are funded on a pay-as-you-go basis. The City recognizes the cost of
providing these benefits as an expense and corresponding revenue in the Internal Service Fund(self funded
health insurance). Medical, dental and life insurance claims and premiums are reported in the Internal
Service Fund. As of September 30,2017 and September 30,2016,this fund had adequate resources to fund
the net OPEB obligation.
The City recognized the following liability in the financial statements at September 30, 2017. The City
performed an actuarial valuation during fiscal year 2017. The annual required contribution and OPEB
liability for fiscal year 2017 is based upon the October 1, 2017 biennial actuarial valuation.
The annual OPEB cost associated with the City's retiree benefits for the fiscal year ended
September 30,2017, is as follows:
2017 Amounts
2016 Total Governmental Proprietary Total
Annual required contribution $ 1,049,156 $ 956,985 $ 130, 498 $ 1,087,483
Interest on net OPEB obligation 140,557 142,866 19,482 162,348
Adjustment to annual required
contribution (127,400) (129,493) (17,658) (147,151)
Annual OPEB cost 1,062,313 970,358 132,322 1,102,680
Contributions made (578,066) (430,302) (58,678) (488,980)
Change in net OPEB obligation 484,247 540,056 73,644 613,700
Beginning net OPEB obligation 3,123,486 3,201,091 406,642 3,607,733
Net OPEB obligation $ 3,607,733 $ 3,741,147 $ 480,286 $ 4,221,433
Percentage of annual OPEB cost
contributed 54.4% 44.3%
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net
OPEB obligation for 2017 and the preceding two years is as follows:
Three-Year Trend Information
%of Annual
Fiscal Year Annual OPEB Actual Cost Net OPEB
Ending Cost Contribution Made Contributed Obligation
2015 $ 937,133 $ 495,926 52.90% $ 3,123,486
2016 $ 1,062,313 $ 578,066 54.42% $ 3,607,733
2017 $ 1,102,680 $ 488,980 44.30% $ 4,221,433
99
CITY OF ROUND ROCK, TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
D. OTHER POST-EMPLOYMENT BENEFITS(CONTINUED)
Actuarial valuations involve estimates of the value of reported amounts and assumptions about the
probability of events far into the future. Actuarially determined amounts are subject to continual revision
as actual results are compared to past expectations and new estimates are made about the future. The
required schedule of funding progress immediately following the notes to the financial statements presents
multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over
time relative to the actuarial accrued liability for benefits. Calculations are based on the types of benefits
provided under the terms of the substantive plan at the time of each valuation and on the pattern of sharing
of costs between the employer and plan members to that point. Actuarial calculations reflect a long-term
perspective. Consistent with that perspective, actuarial methods and assumptions used include techniques
that are designed to reduce short-term volatility in actuarial accrued liabilities and the actuarial value of
assets. The actuarial cost method and significant assumptions underlying the actuarial calculation are as
follows:
Schedule of Actuarial Valuations
Actuarial Valuation Date October 1, 2013 October 1, 2015 October 1, 2017
Actuarial Cost Methods Projected Unit Credit Projected Unit Credit Projected Unit Credit
Amortization Method Level Percent Open Level Percent Open Level Percent Open
Remaining Amortization Period 30 years 30 years 30 years
Inflation Rate 3.5% 3.5% 3.5%
Assumed Rate of
Return on Investments 4.5% 4.5% 4.5%
Projected Salary Increases 3.0% 3.0% 3.0%
Post-retirement Benefit 10%in 2011, 10%in 2011, 10%in 2011,
Increases decreasing 0.5%per decreasing 0.5%per decreasing 0.5%per
year for ten years to an year for ten years to an year for ten years to an
ultimate trend of 5%in ultimate trend of 5% in ultimate trend of 5%in
2021 2021 2021
Funded Status and Funding Progress:
As of October 1, 2017, the most recent actuarial valuation date, the actuarial accrued liability for benefits
was $12,201,040, all of which was unfunded. The covered payroll (annual payroll of active employees
covered by the plan)for fiscal year 2017 was $59,425,681, and the ratio of the unfunded actuarial accrued
liability to the covered payroll was 20.5%.
The schedule of funding progress,presented as required supplementary information following the notes to
the financial statements, shows what percent of the liability is funded. Currently,the benefit has not been
funded with contributions with plan assets so the funded ratio is 0%. Although not considered contributions
under GASB Statement No. 45,the City has net position available for funding the OPEB liability.
100
CITY OF ROUND ROCK,TEXAS
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30,2017
V. OTHER INFORMATION (CONTINUED)
E. MUNICIPAL GOLF COURSE
Management Agreement
Management of the City's golf course has been performed by a private operator in accordance with the
terms of a Management Agreement since 1989. Under that agreement, operations and management were
handled independently by the operator with the City recording net revenues. The City exercised the early
termination option on December 31,2016.
On November 22,2016,the City signed a new Management Agreement with a new operator with an initial
term of three years that shall automatically renew for two additional I-year terms. The agreement began
on January 1, 2017. Under conditions set forth in the new Management Agreement, the operator shall be
paid a monthly base management fee. Additionally,the operator may earn an annual incentive management
fee based upon gross receipts of the golf course.
F. SUBSEQUENT EVENTS
Capital Lease
In October 2017,the City secured a master lease agreement with Frost Bank in the amount of$3,000,000
to lease/purchase various pieces of large equipment and rolling stock. The term of the lease is five (5)
years.
Bond Issuance
In December 2017,the City issued Utility System Revenue Refunding Bonds, Series 2017, in the amount
of$33,410,000. Proceeds from the sale of the bonds will be used to refund certain of the City's Outstanding
Parity Debt to achieve a debt service savings and to pay the costs of issuing the bonds. Standard and Poor's
upgraded the City's utility debt to AAA,the highest credit rating possible. This rating helped increase the
savings on the City's refunding to$3 million.
BCRUA Contract Revenue Bonds
In November 2017,the Brushy Creek Regional Utility Authority issued approximately$17 million of State
Water Implementation Fund for Texas (SWIFT) notes payable, of which $4,435,000 is the City's
share. Proceeds from the sale of the bonds will be used to complete Phase 1 C of the BCRUA expansion
project which will provide necessary conveyance and treatment capacity until Phase 2 of the regional
project is completed. The expansion will increase the plant capacity treatment from 17 million gallons per
day(MGD)to 30 MGD.
101
• N
102
CITY OF ROUND ROCK, TEXAS
REQUIRED SUPPLEMENTARY INFORMATION
SEPTEMBER 30,2017
(UNAUDITED)
Schedule of Funding Progress
Percentage
Actuarial Actuarial Actuarial Annual of UAAL
Valuation Value of Accrued Funded Covered to Covered
Plan Date Assets Liability UAAL Ratio Payroll Payroll
Other Post-Employment Benefits
10/01/2015 $ - $ 11,162,966 $ 11,162,966 0.0% $ 52,956,052 21.1%
10/01/2016 $ - $ 11,661,976 $ 11,661,976 0.0% $ 56,923,747 20.5%
10/01/2017 $ - $ 12,201,040 $ 12,201,040 0.0% $ 59,425,681 20.5%
See Independent Auditors' Report.
1.03
CITY OF ROUND ROCK,TEXAS
REQUIRED SUPPLEMENTARY INFORMATION
SEPTEMBER 30,2017
(UNAUDITED)
Schedule of Changes in the Net Pension Liability and Related Ratios
Measurement period ending December 31, 2014 2015 2016
Total pension liability
Service Cost $ 8,066,254 $ 8,990,916 $ 9,609,823
Interest(on the Total Pension Liability) 13,330,143 14,481,391 15,065,206
Difference between expected and actual experience (50,055) (662,530) 704,655
Change of assumptions - (1,208,085) -
Benefit payments,including refunds of employee contributions (5,231,094) (5,493,451) (5,706,408)
Net Change in Total Pension Liability 16,115,248 16,108,241 19,673,276
Total Pension Liability-Beginning 189,013,034 205,128,282 221,236,523
Total Pension Liability-Ending(a) $ 205,128,282 $ 221,236,523 $ 240,909,799
Plan Fiduciary Net Position
Contributions-Employer $ 7,787,328 $ 8,195,714 $ 8,302,118
Contributions-Employee 3,423,287 3,644,800 3,779,341
Net Investment Income 8,955,552 252,867 12,021,503
Benefit payments,including refunds of employee contributions (5,231,094) (5,493,451) (5,706,408)
Administrative Expense (93,479) (154,001) (135,695)
Other (7,685) (7,607) (7,311)
Net Change in Plan Fiduciary Net Position 14,833,909 6,438,322 18,253,548
Plan Fiduciary Net Position-Beginning 156,512,946 171,346,855 177,785,177
Plan Fiduciary Net Position-Ending(b) 171,346,855 177,785,177 196,038,725
Net Pension Liability-Ending(a)-(b) $ 33,781,427 $ 43,451,346 $ 44,871,074
Plan Fiduciary Net Position as a Percentage of Total Pension
Liability 83.53% 80.36% 81.37%
Covered Payroll $ 48,839,040 $ 51,731,390 $ 53,776,289
Net Pension Liability as a Percentage of Covered Payroll 69.17% 83.99% 83.44%
Notes to Schedule:
1)No significant factors noted to disclose.
2)No significant methods and assumptions to disclose.
3) Schedule will be built out to 10 years.
See Independent Auditors' Report.
104
CITY OF ROUND ROCK,TEXAS
REQUIRED SUPPLEMENTARY INFORMATION
SEPTEMBER 30,2017
(UNAUDITED)
Schedule of Contributions
Fiscal year ending September 30, 2015 2016 2017
Actuarially Determined Contribution $ 8,077,742 $ 8,507,987 $ 8,897,294
Contributions in relation to the actuarially determined
contribution 8,193,478 8,739,633 9,059,953
Contribution deficiency(excess) $ (115,736) $ (231,646) $ (162,659)
Covered payroll $ 51,159,783 $ 54,924,766 $ 57,346,696
Contributions as a percentage of covered payroll 16.02% 15.91% 15.80%
Notes to Schedule of Contributions
Valuation Date:
Actuarially determined contribution rates are calculated as of December 31 and become effective in January, 13
months and a day later.
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 3.50%to 10.5%including inflation
Investment Rate of Return 6.75%
Retirement Age 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 2010-2014.
Mortality RP2000 Combined Mortality Table with Blue Collar Adjustment
with male rates multiplied by 109%and female rates multiplied
by 103%and projected on a frilly generational basis with scale
BB.
Other Information:
There were no benefit changes during the year. Schedule will be built out to ten years.
See Independent Auditors' Report.
105
NONMAJOR GOVERNMENTAL FUNDS
NONMAJOR SPECIAL REVENUE FUNDS
Special Revenue Funds account for specific resources, other than major capital projects that are restricted to
expenditures for specified purposes.
NONMAJOR CAPITAL PROJECTS FUNDS
Capital Projects Funds are used to account for financial resources to be used for major capital projects (other than
those financed by the proprietary fund). General obligation bonds are the primary funding source for capital
projects.
106
CITY OF ROUND ROCK, TEXAS
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
SEPTEMBER 30,2017
Total
Nonmaj or
Special Capital Governmental
Revenue Funds Projects Funds Funds
ASSETS
Cash and cash equivalents $ 980,262 $ 227,715 $ 1,207,977
Investments 8,099,569 1,886,627 9,986,196
Receivables-
Accounts and other 528,333 - 528,333
Accrued interest 11,287 2,663 13,950
Interfund 76,032 - 76,032
Grants 31,648 - 31,648
Restricted assets-
Cash and cash equivalents - 1,428,265 1,428,265
Restricted investments - 2,292,242 2,292,242
Restricted accrued interest - 3,236 3,236
Total assets $ 9,727,131 $ 5,840,748 $ 15,567,879
LIABILITIES AND FUND BALANCES
Liabilities-
Accounts payable $ 162,241 $ 336,917 $ 499,158
Accrued payroll 53,979 - 53,979
Unearned revenue - 1,093,432 1,093,432
Total liabilities 216,220 1,430,349 1,646,569
Fund balances-
Restricted-authorized construction - 3,393,866 3,393,866
Restricted-hotel-motel tax 6,526,672 - 6,526,672
Restricted-public safety 585,878 - 585,878
Restricted-general government 1,269,075 - 1,269,075
Committed-general government 124,703 - 124,703
Committed-capital projects funds - 1,016,533 1,016,533
Assigned-culture and recreation 1,004,583 - 1,004,583
Total fund balances 9,510,911 4,410,399 13,921,310
Total liabilities and
fund balances $ 9,727,131 $ 5,840,748 $ 15,567,879
107
CITY OF ROUND ROCK,TEXAS
NONMAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES,EXPENDITURES AND
CHANGES IN FUND BALANCES
YEAR ENDED SEPTEMBER 30, 2017
Total
Nonmaj or
Special Capital Governmental
Revenue Funds Projects Funds Funds
Revenues-
Taxes and franchise $ 228,498 $ - $ 228,498
Licenses, permits and fees 40,665 - 40,665
Charges for services 1,452,525 - 1,452,525
Fines and forfeitures 204,892 - 204,892
Grants 479,589 - 479,589
Hotel occupancy tax 5,515,163 - 5,515,163
Investment and other 152,377 302,859 455,236
Contributions 6,541 285,727 292,268
Total revenues 8,080,250 588,586 8,668,836
Expenditures-
Current-
General government 735,769 - 735,769
Public safety 244,852 - 244,852
Culture and recreation 2,957,278 - 2,957,278
Capital projects - 10,762,716 10,762,716
Total expenditures 3,937,899 10,762,716 14,700,615
Excess(deficiency)of
revenues over expenditures 4,142,351 (10,174,130) (6,031,779)
Other financing sources(uses)-
Transfers in 1,200,100 8,744,000 9,944,100
Transfers out (10,467,480) (714,384) (11,181,864)
Total other financing
sources(uses) (9,267,380) 8,029,616 (1,237,764)
Net change in fund balances (5,125,029) (2,144,514) (7,269,543)
Fund balances,October 1,2016 14,635,940 6,554,913 21,190,853
Fund balances, September 30,2017 $ 9,510,911 $ 4,410,399 $ 13,921,310
108
NONMAJOR SPECIAL REVENUE FUNDS
Special Revenue Funds account for specific resources, other than major capital projects that are restricted to
expenditures for specified purposes.
Community Development Block Grant Fund —To account for grant monies received for programs benefiting
persons of low to moderate income.
Hotel-Motel Occupancy Tax Fund—To account for the levy and use of the 7%hotel—motel bed tax received.
Proceeds from this tax are to be used toward tourism, community events, cultural enhancements and promotion of
the City.
Hotel-Motel Occupancy Venue Tax Fund—To account for the levy and use of the 2%hotel—motel bed venue
tax received. Proceeds from this tax are to be used toward the construction and maintenance of the sports center
that prompts tourism and promotion of the City.
Landscape Fund—To account for amounts received through the City's landscape ordinance.
Library Fund—To account for contributions received designated to specific programs for the City's library.
Multipurpose Sports Complex Fund — To account for amounts received to provide for the operations,
maintenance, and programming for the Multipurpose Sports Complex.
Municipal Court Fund —To account for amounts received through child safety fines, court security, and court
technology fees.
Police Fund—To account for amounts received through drug enforcement actions.
Public Education & Government Fund — To account for amounts received for programs to provide public
education in government.
Traffic Safety Program Fund—To account for amounts received to promote traffic safety programs.
109
CITY OF ROUND ROCK,TEXAS
NONMAJOR SPECIAL REVENUE FUNDS
COMBINING BALANCE SHEET
SEPTEMBER 30,2017
Community Hotel-Motel Hotel-Motel
Development Occupancy Occupancy
Block Grant Tax Venue Tax Landscape
ASSETS
Cash and cash equivalents $ - $ 189,190 $ 471,468 $ 16,678
Investments - 1,567,450 3,884,178 138,180
Receivables-
Accounts and other - 410,937 117,396 -
Accrued interest - 2,212 5,483 195
Interfund - - - -
Grants 31,648 - - -
Total assets $ 31,648 $ 2,169,789 $ 4,478,525 $ 155,053
LIABILITIES AND FUND BALANCES
Liabilities-
Accounts payable $ 31,648 $ 35,251 $ 39,052 $ 30,350
Accrued payroll - 12,515 34,824 -
Total liabilities 31,648 47,766 73,876 30,350
Fund balances-
Restricted-hotel-motel tax - 2,122,023 4,404,649 -
Restricted-public safety - - - -
Restricted-general government - - - -
Committed-general government - - - 124,703
Assigned-culture and recreation - - - -
Total fiend balances - 2,122,023 4,404,649 124,703
Total liabilities and
fund balances $ 31,648 $ 2,169,789 $ 4,478,525 $ 155,053
110
Total
Multipurpose Public Traffic Nonmajor
Sports Municipal Education& Safety Special
Library Complex Court Police Government Program Revenue Funds
$ 1,713 $ 108,525 $ 42,498 $ 1,312 $ 136,507 $ 12,371 $ 980,262
14,194 899,137 352,096 10,868 1,130,972 102,494 8,099,569
- - - - - - 528,333
20 1,269 497 15 1,596 - 11,287
- - - - - 76,032 761,032
- - - - - - 31,648
$ 15,927 $ 1,008,931 $ 395,091 $ 12,195 $ 1,269,075 $ 190,897 $ 9,727,131
$ - $ 13,635 $ 125 $ 12,180 $ - $ - $ 162,241
6,640 - - - - 53,979
20,275 125 12,180 - - 216,220
- - - - - 6,526,672
394,966 15 - 190,897 585,878
- - 1,269,075 - 1,269,075
- - - - - 124,703
15,927 988,656 - - - - 1,004,583
15,927 988,656 394,966 15 1,269,075 190,897 9,510,911
$ 15,927 $ 1,008,931 $ 395,091 $ 12,195 $ 11,269,075 $ 190,897 $ 9,727,131
111
CITY OF ROUND ROCK, TEXAS
NONMAJOR SPECIAL REVENUE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
YEAR ENDED SEPTEMBER 30,2017
Community Hotel-Motel Hotel-Motel
Development Occupancy Occupancy
Block Grant Tax Venue Tax Landscape
Revenues-
Taxes and franchise $ - $ - $ - $ -
Licenses,permits and fees - - - 40,665
Charges for services - - 1,278,991 -
Fines and forfeitures - - - -
Grants 479,589 - - -
Hotel occupancy tax - 4,289,595 1,225,568 -
Investment and other 11,377 31,320 79,185 1,656
Contributions - - - -
Total revenues 490,966 4,320,915 2,583,744 42,321
Expenditures-
Current-
General government 490,966 - - 129,698
Public safety - - - -
Culture and recreation - 914,898 1,649,319 -
Total expenditures 490,966 914,898 1,649,319 129,698
Excess(deficiency)of
revenues over expenditures - 3,406,017 934,425 (87,377)
Other financing sources(uses)-
Transfers in - - - -
Transfers out - (10,094,000) (373,480) -
Total other financing
sources(uses) - (10,094,000) (373,480)
Net change in fiend balances - (6,687,983) 560,945 (87,377)
Fund balances,October 1,2016 - 8,810,006 3,843,704 212,080
Fund balances,September 30,2017 $ - $ 2,122,023 $ 4,404,649 $ 124,703
112
Total
Nonmajor
Multipurpose Public Traffic Special
Sports Municipal Education& Safety Revenue
Library Complex Court Police Government Program Funds
$ - $ - $ - $ - $ 228,498 $ - $ 228,498
- - 40,665
173,534 - - - - 1,452,525
- 108,559 96,333 - - 204,892
- - - - 479,589
- - - - - 5,515,163
151 5,151 3,319 9,115 11,103 - 152,377
6,541 - - - - - 6,541
6,692 178,685 111,878 105,448 239,601 - 8,080,250
- - 63,420 - 51,685 - 735,769
- - - 244,774 - 78 244,852
3,032 390,029 - - - - 2,957,278
3,032 390,029 63,420 244,774 51,685 78 3,937,899
3,660 (211,344) 48,458 (139,326) 187,916 (78) 4,142,351
- 1,200,000 - - - 100 1,200,100
- - - - - (10,467,480)
1,200,000 - - - 100 (9,267,380)
3,660 988,656 48,458 (139,326) 187,916 22 (5,125,029)
12,267 - 346,508 139,341 1,081,159 190,875 14,635,940
$ 15,927 $ 988,656 $ 394,966 $ 15 $ 1,269,075 $ 190,897 $ 9,510,911
113
•••� �••
s
4Y
114
NONMAJOR CAPITAL PROJECTS FUNDS
Capital Projects Funds are used to account for financial resources to be used for major capital projects (other than
those financed by the proprietary fund).
2004 & 2007 General Obligation Bonds Fund—To account for street, traffic safety and sidewalk improvement
projects, improvements and equipment for police,fire and municipal office facilities.
2014 Certificates of Obligation Fund—To account for transportation improvements.
Convention Center Complex Fund—To account for the ongoing repairs,maintenance and capital improvements
to the city-owned Dell Diamond, a minor league baseball stadium and conference center. Funding is provided by
hotel tax revenues.
Park Development Fund—To account for the development of and improvements to various neighborhood parks.
Funding is provided by general government resources.
Streets and Drainage Fund —To account for street and drainage improvements in the Arterial II section of the
City. Funding is provided by general government resources.
Tourism Development Fund — To account for the development of tourism. Funding is provided by hotel tax
revenues.
115
CITY OF ROUND ROCK,TEXAS
NONMAJOR CAPITAL PROJECTS FUNDS
COMBINING BALANCE SHEET
SEPTEMBER 30,2017
2004&2007
General Convention
Obligation 2014 Series Center
Bonds CO Complex
ASSETS
Cash and cash equivalents $ - $ - $ -
Investments - - -
Receivables-
Accrued interest - - -
Restricted assets -
Cash and cash equivalents - 1,151,592 70,088
Restricted investments - - 580,679
Restricted accrued interest - - 820
Total assets $ - $ 1,151,592 $ 651,587
LIABILITIES AND FUND BALANCES
Liabilities-
Accounts payable $ - $ 103,063 $ 1,262
Unearned revenue - - -
Total liabilities - 103,063 1,262
Fund balances-
Restricted-authorized construction - 1,048,529 650,325
Committed-capital projects funds - - -
Total fund balances - 1,048,529 650,325
Total liabilities and
fund balances $ - $ 1,151,592 $ 651,587
116
Total
Nonmaj or
Capital
Park Streets and Tourism Projects
Development Drainage Development Funds
$ 149,961 $ 77,754 $ - $ 227,715
1,242,430 644,197 - 1,886,627
1,754 909 - 2,663
- - 206,585 1,428,265
1,711,563 2,292,242
- - 2,416 3,236
$ 1,394,145 $ 722,860 $ 1,920,564 $ 5,840,748
$ 7,040 $ - $ 225,552 $ 336,917
1,093,432 - - 1,093,432
1,100,472 - 225,552 1,430,349
- - 1,695,012 3,393,866
293,673 722,860 - 1,016,533
293,673 722,860 1,695,012 4,410,399
$ 1,394,145 $ 722,860 $ 1,920,564 $ 5,840,748
117
CITY OF ROUND ROCK, TEXAS
NONMAJOR CAPITAL PROJECTS FUNDS
COMBINING STATEMENT OF REVENUES,EXPENDITURES AND
CHANGES IN FUND BALANCES
YEAR ENDED SEPTEMBER 30,2017
2004&2007
General Convention
Obligation 2014 Series Center
Bonds CO Complex
Revenues-
Investment and other $ - $ 32,461 $ 236,243
Contributions - - 218,968
Total revenues - 321461 455,211
Expenditures-
Capital projects 87,552 3,013,530 2,075,445
Total expenditures 87,552 3,013,50 2,075,445
Excess(deficiency)of
revenues over expenditures (87,552) (2,981,069) (11620,234)
Other financing sources(uses)-
Transfers in - - 1,844,000
Transfers out (275,509) - -
Total other financing
sources(uses) (275,509) - 1,844,000
Net change in fund balances (363,061) (2,981,069) 223,766
Fund balances,October 1,2016 363,061 4,029,598 426,559
Fund balances, September 30,2017 $ - $ 1,048,529 $ 650,325
118
Total
Nonmaj or
Streets Capital
Park and Tourism Projects
Development Drainage Development Funds
$ 12,246 $ 9,540 $ 12,369 $ 302,859
66,759 - - 285,727
79,005 9,540 12,369 588,586
66,759 - 55519,430 10,762,716
66,759 - 5,519,430 10,762,716
12,246 9,540 (5,507,061) (10,174,130)
- - 6,900,000 8,744,000
(438,875) - (714,384)
- (438,875) 6,900,000 8,029,616
12,246 (429,335) 1,392,939 (2,144,514)
281,427 1,152,195 302,073 6,554,913
$ 293,673 $ 722,860 $ 1,695,012 $ 4,410,399
119
,,Awa► 41
120
SCHEDULES OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCES - BUDGET AND ACTUAL
GENERAL, DEBT SERVICE
AND NONMAJOR SPECIAL REVENUE FUNDS
121
CITY OF ROUND ROCK,TEXAS
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
YEAR ENDED SEPTEMBER 30,2017
WITH COMPARATIVE TOTALS FOR YEAR ENDED SEPTEMBER 30,2016
Variance-
Budgeted Amounts Positive 2016
Original Final Actual (Negative) Actual
Revenues-
Taxes and franchise-
Property tax $ 31,150,000 $ 31,150,000 $ 31,397,927 $ 247,927 $ 27,017,296
Penalty and interest 75,000 75,000 77,335 2,335 75,044
Sales tax 43,892,000 43,995,294 46,595,602 2,600,308 50,505,090
Franchise 6,865,000 6,865,000 6,875,050 10,050 6,910,979
Bingo tax 38,000 38,000 38,156 156 38,759
Mixed drink tax 450,000 450,000 589,008 139,008 527,953
Total taxes and franchise 82,470,000 82,573,294 85,573,078 2,999,784 85,075,121
Licenses,permits and fees-
Building permits 451,000 491,643 663,161 171,518 614,937
Other permits 36,000 36,000 47,750 11,750 50,533
Fees 746,600 746,600 894,501 147,901 1,172,838
Total licenses,permits,and fees 1,233,600 1,274,243 1,605,412 331,169 1,838,308
Charges for services-
Trash collection fees 1,303,000 1,303,000 1,261,138 (41,862) 1,297,118
Swimming pool fees 908,000 908,000 1,220,042 312,042 1,090,494
Recreation program fees 2,165,000 2,165,000 2,214,546 49,546 2,264,562
Filing and reproduction fees 25,000 25,000 27,598 2,598 27,410
Other 151,600 151,600 131,528 (20,072) 177,208
Total charges for services 4,552,600 4,552,600 4,854,852 302,252 4,856,792
Fines and forfeitures 1,115,000 1,115,000 1,235,903 120,903 1,339,334
Grants 365,000 365,000 649,921 284,921 470,988
Investment and other-
Investment income 300,000 300,000 518,868 218,868 373,585
Other 4,081,300 4,081,300 4,608,876 527,576 5,132,945
Total investment and other 4,381,300 4,381,300 5,127,744 746,444 5,506,530
Total revenues 94,117,500 94,261,437 99,046,910 4,785,473 99,087,073
122 (CONTINUED)
CITY OF ROUND ROCK,TEXAS
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL (CONTINUED)
YEAR ENDED SEPTEMBER 30,2017
WITH COMPARATIVE TOTALS FOR YEAR ENDED SEPTEMBER 30,2016
Variance-
Budgeted Amounts Positive 2016
Original Final Actual (Negative) Actual
Expenditures-
Current-
General government
Executive-
Personnel services $ 13,499,707 $ 11,211,854 $ 11,211,849 $ 5 $ 10,128,213
Contractual services 4,619,337 4,456,057 4,262,965 193,092 3,879,733
Supplies and materials 747,224 738,352 723,906 14,446 713,094
Other services and charges 2,643,771 2,515,381 2,079,888 435,493 8,168,563
Capital outlay 93,000 115,377 80,501 34,876 65,568
Total executive 21,603,039 19,037,021 18,359,109 677,912 22,955,171
Judicial-
Personnel services 786,102 813,958 742,752 71,206 740,218
Contractual services 60,992 60,992 51,989 9,003 46,024
Supplies and materials 17,340 17,340 11,211 6,129 15,810
Other services and charges 12,310 12,310 6,824 5,486 6,911
Total judicial 876,744 904,600 812,776 91,824 808,963
Total general government 22,479,783 19,941,621 19,171,885 769,736 23,764,134
Public safety
Police-
Personnel services 24,412,786 24,706,337 24,706,332 5 23,639,739
Contractual services 795,097 864,832 864,832 - 903,824
Supplies and materials 1,981,567 1,667,243 1,664,289 2,954 1,348,856
Other services and charges 1,221,361 1,204,361 1,186,390 17,971 937,028
Capital outlay 140,181 334,370 310,635 23,735 8,495
Total police 28,550,992 28,777,143 28,732,478 44,665 26,837,942
Fire-
Personnel services 15,149,205 16,942,371 16,942,371 - 15,216,099
Contractual services 405,630 371,108 371,108 - 339,587
Supplies and materials 1,086,557 1,148,958 1,148,958 - 1,059,084
Other services and charges 188,334 156,117 156,117 - 156,440
Capital outlay 22,000 - - - 76,775
Total fire 16,851,726 18,618,554 18,618,554 - 16,847,985
Total public safety 45,402,718 47,395,697 47,351,032 44,665 43,685,927
123 (CONTINUED)
CITY OF ROUND ROCK, TEXAS
GENERAL FUND
SCHEDULE OF REVENUES,EXPENDITURES AND CHANGES
IN FUND BALANCES - BUDGET AND ACTUAL (CONTINUED)
YEAR ENDED SEPTEMBER 30,2017
WITH COMPARATIVE TOTALS FOR YEAR ENDED SEPTEMBER 30,2016
Variance-
Budgeted Amounts Positive 2016
Original Final Actual (Negative) Actual
Expenditures-(cont'd)
Current-(cont'd)
Public works
Administration-
Personnel services $ 3,431,114 $ 3,270,012 $ 3,270,012 $ - $ 3,236,231
Contractual services 173,210 203,300 203,298 2 128,934
Supplies and materials 917,009 917,379 829,068 88,311 720,639
Other services and charges 1,125,340 1,041,300 906,666 134,634 813,386
Capital outlay - 47,895 47,895 - 31,975
Total administration 5,646,673 5,479,886 5,256,939 222,947 4,931,165
Streets-
Personnel services 2,060,698 2,122,912 2,122,906 6 1,937,976
Contractual services 5,267,432 2,168,272 1,552,458 615,814 1,400,444
Supplies and materials 870,255 870,255 791,545 78,710 733,937
Other services and charges 45,153 45,153 18,109 27,044 17,880
Capital outlay 186,000 186,000 113,565 72,435 232,429
Total streets 8,429,538 5,392,592 4,598,583 794,009 4,322,666
Maintenance shop-
Personnel services 1,324,830 1,359,903 1,304,834 55,069 1,225,516
Contractual services 45,197 45,197 43,701 1,496 37,029
Supplies and materials 121,110 128,915 128,914 1 129,303
Other services and charges 21,375 21,375 18,440 2,935 22,940
Capital outlay 20,000 90,000 83,026 6,974 -
Total maintenance shop 1,532,512 1,645,390 1,578,915 66,475 1,414,788
Total public works 15,608,723 12,517,868 11,434,437 1,083,431 10,668,619
124 (CONTINUED)
CITY OF ROUND ROCK, TEXAS
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL (CONTINUED)
YEAR ENDED SEPTEMBER 30,2017
WITH COMPARATIVE TOTALS FOR YEAR ENDED SEPTEMBER 30,2016
Variance-
Budgeted Amounts Positive 2016
Original Final Actual (Negative) Actual
Expenditures-(cont'd)
Current-(cont'd)
Culture and recreation
Library-
Personnel services $ 1,936,802 $ 2,078,414 $ 2,078,413 $ 1 $ 1,940,132
Contractual services 160,025 133,813 133,813 - 132,561
Supplies and materials 375,416 331,568 331,568 - 328,935
Other services and charges 198,033 193,751 192,662 1,089 201,632
Culture-Library-capital outlay - 17,495 17,495 - -
Total library 2,670,276 2,755,041 2,753,951 1,090 2,603,260
Parks and recreation-
Personnel services 7,337,232 7,818,576 7,818,576 - 6,877,096
Contractual services 1,798,529 1,609,747 1,609,747 - 1,637,709
Supplies and materials 1,455,488 1,649,731 1,649,731 - 1,471,239
Other services and charges 262,185 307,286 307,286 - 314,164
Capital outlay 97,000 123,131 123,131 - 107,243
Total parks and recreation 10,950,434 11,508,471 11,508,471 - 10,407,451
Total culture and recreation 13,620,710 14,263,512 14,262,422 1,090 13,010,711
Total expenditures 97,111,934 94,118,698 92,219,776 1,898,922 91,129,391
Excess(deficiency)of
revenues over expenditures (2,994,434) 142,739 6,827,134 6,684,395 7,957,682
Other financing sources(uses)-
Transfers in 3,355,800 3,355,800 3,355,800 - 3,290,000
Transfers out (9,600,000) (12,725,000) (12,660,934) 64,066 (9,155,808)
Total other financing sources(uses) (6,244,200) (9,369,200) (9,305,134) 64,066 (5,865,808)
Net change in fund balances $ (9,238,634) $ (9,226,461) (2,478,000) $ 6,748,461 2,091,874
Fund balance,October 1,2016 52,800,084 50,708,210
Fund balance,September 30,2017 $ 50,322,084 $ 52,800,084
125
CITY OF ROUND ROCK,TEXAS
DEBT SERVICE FUND
SCHEDULE OF REVENUES,EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
YEAR ENDED SEPTEMBER 30,2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Taxes and franchise $ 17,362,000 $ 17,362,000 $ 17,726,552 $ 364,552
Investment and other 5,000 5,000 101,787 96,787
Total revenues 17,367,000 17,367,000 17,828,339 461,339
Expenditures
Debt service-
Principal retirement 10,201,542 14,215,049 13,287,160 927,889
Interest and fiscal charges 7,462,625 8,306,767 8,306,767 -
Payment to refunding agent 10,050,443 10,050,443 10,050,443 -
Issuance costs 86,311 86,311 86,311 -
Total expenditures 27,800,921 32,658,570 31,730,681 927,889
Excess(deficiency)of revenues
over expenditures (10,433,921) (15,291,570) (13,902,342) 1,389,228
Other financing sources(uses)-
Issuance of refunding bonds 10,140,000 10,140,000 10,140,000 -
Transfers in 4,330,400 4,330,400 4,893,679 563,279
Total other financing sources(uses) 14,470,400 14,470,400 15,033,679 563,279
Net change in fund balances $ 4,036,479 $ (8211170) 1,131,337 $ 1,952,507
Fund balance,October 1,2016 2,749,645
Fund balance, September 30,2017 $ 3,880,982
126
CITY OF ROUND ROCK,TEXAS
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES,EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
COMMUNITY DEVELOPMENT BLOCK GRANT
YEAR ENDED SEPTEMBER 30,2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Grants $ 479,589 $ 479,589 $ 479,589 $ -
Investment and other 11,377 11,377 11,377 -
Total revenues 490,966 490,966 490,966 -
Expenditures-
Current-
General government-
Supplies and materials 9,929 9,929 9,929 -
Other services and charges 209,150 209,150 209,150 -
Capital outlay 271,887 271,887 271,887 -
Total expenditures 490,966 490,966 490,966 -
Net change in fund balances $ - $ - - $ _
Fund balance, October 1,2016 _
Fund balance, September 30,2017 $
127
CITY OF ROUND ROCK, TEXAS
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
HOTEL-MOTEL OCCUPANCY TAX FUND
YEAR ENDED SEPTEMBER 30, 2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)-
Revenues-
Charges
Negative)Revenues-
Charges for services $ 110,000 $ 110,000 $ - $ (110,000)
Hotel occupancy tax 4,100,000 4,100,000 4,289,595 189,595
Investment and other 20,000 20,000 31,320 11,320
Contributions 20,000 20,000 - (20,000)
Total revenues 4,250,000 4,250,000 4,320,915 70,915
Expenditures-
Current-
Culture and recreation-
Personnel services 465,643 465,643 374,024 91,619
Contractual services 426,552 426,552 260,559 165,993
Supplies and materials 44,780 44,780 3,522 41,258
Other services and charges 607,123 607,123 276,793 330,330
Total expenditures 1,544,098 1,544,098 914,898 629,200
Excess(deficiency)of revenues over
expenditures 2,705,902 2,705,902 3,406,017 700,115
Other financing sources(uses)-
Transfers out (6,173,237) (10,094,000) (10,094,000) -
Total other financing sources (uses) (6,173,237) (10,094,000) (10,094,000) -
Net change in fund balances $ (3,467,335) $ (7,388,098) (6,687,983) $ 700,115
Fund balance, October 1,2016 8,810,006
Fund balance, September 30,2017 $ 2,122,023
128
CITY OF ROUND ROCK,TEXAS
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES,EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
HOTEL-MOTEL OCCUPANCY VENUE TAX FUND
YEAR ENDED SEPTEMBER 30,2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Charges for services $ 1,030,000 $ 1,030,000 $ 1,278,991 $ 248,991
Hotel occupancy tax 1,110,000 1,110,000 1,225,568 115,568
Investment and other 54,000 54,000 79,185 25,185
Total revenues 2,194,000 2,194,000 2,583,744 389,744
Expenditures-
Current-
Culture and recreation-
Personnel services 773,882 1,022,392 1,022,389 3
Contractual services 404,800 304,800 289,493 15,307
Supplies and materials 276,335 267,825 260,518 7,307
Other services and charges 88,100 48,100 47,712 388
Capital outlay 150,000 50,000 29,207 20,793
Total expenditures 1,693,117 1,693,117 1,649,319 43,798
Excess(deficiency)of revenues over
expenditures 500,883 500,883 934,425 433,542
Other financing sources(uses)-
Transfers out (373,480) (373,480) (373,480) -
Total other financing sources(uses) (373,480) (373,480) (373,480) -
Net change in fund balances $ 127,403 $ 127,403 560,945 $ 433,542
Fund balance,October 1,2016 3,843,704
Fund balance, September 30,2017 $ 4,404,649
129
CITY OF ROUND ROCK,TEXAS
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
LANDSCAPE FUND
YEAR ENDED SEPTEMBER 30,2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Licenses,permits and fees $ 35,000 $ 35,000 $ 40,665 $ 5,665
Investment and other 100 100 1,656 1,556
Contributions 1,000 1,000 - (1,000)
Total revenues 36,100 36,100 42,321 6,221
Expenditures-
Current-
General government-
Supplies and materials 205,204 205,204 129,698 75,506
Total expenditures 205,204 205,204 129,698 75,506
Net change in fund balances $ (169,104) $ (169,104) (87,377) $ 81,727
Fund balance, October 1,2016 212,080
Fund balance,September 30,2017 $ 124,703
130
CITY OF ROUND ROCK, TEXAS
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
LIBRARY FUND
YEAR ENDED SEPTEMBER 30, 2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Investment and other $ 10 $ 10 $ 151 $ 141
Contributions 3,000 3,000 6,541 3,541
Total revenues 3,010 3,010 6,692 3,682
Expenditures-
Current-
General government-
Supplies and materials 2,400 3,050 35032 18
Other services and charges 14,634 13,984 - 13,984
Total expenditures 17,034 17,034 3,032 14,002
Net change in fund balances $ (14,024) $ (14,024) 3,660 $ 17,684
Fund balance, October 1,2016 12,267
Fund balance,September 30,2017 $ 15,927
131
CITY OF ROUND ROCK,TEXAS
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
MULTIPURPOSE SPORTS COMPLEX
YEAR ENDED SEPTEMBER 30,2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Charges for services $ 157,808 $ 157,808 $ 173,534 $ 15,726
Investment and other - - 5,151 5,151
Total revenues 157,808 157,808 178,685 20,877
Expenditures-
Personnel services 294,688 226,988 139,068 87,920
Contractual services 100,529 100,529 50,568 49,961
Supplies and materials 93,336 161,036 161,007 29
Other services and charges 52,650 52,650 36,886 15,764
Capital outlay 43,500 43,500 2,500 41,000
Total expenditures 584,703 584,703 390,029 194,674
Excess(deficiency)of revenues over
expenditures (426,895) (426,895) (211,344) 215,551
Other financing sources(uses)-
Transfers in 1,200,000 1,200,000 1,200,000 -
Total other financing sources (uses) 1,200,000 1,200,000 1,200,000 -
Net change in fund balances $ 773,105 $ 773,105 988,656 $ 215,551
Fund balance,October 1,2016 -
Fund balance, September 30,2017 $ 988,656
132
CITY OF ROUND ROCK,TEXAS
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES,EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
MUNICIPAL COURT FUND
YEAR ENDED SEPTEMBER 30,2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Fines and forfeitures $ 80,000 $ 80,000 $ 108,559 $ 28,559
Investment and other 150 150 3,319 3,169
Total revenues 80,150 80,150 111,878 31,728
Expenditures-
Current-
General government-
Supplies and materials 99,550 99,550 52,000 47,550
Other services and charges 284,853 274,553 1,164 273,389
Capital outlay - 10,300 10,256 44
Total expenditures 384,403 384,403 63,420 320,983
Excess(deficiency)of revenues over
expenditures (304,253) (304,253) 48,458 352,711
Other financing sources(uses)-
Transfers out (52,000) (52,000) - 52,000
Total other financing sources(uses) (52,000) (52,000) - 52,000
Net change in fund balances $ (356,253) $ (356,253) 48,458 $ 404,711
Fund balance, October 1,2016 346,508
Fund balance, September 30,2017 $ 394,966
133
CITY OF ROUND ROCK, TEXAS
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
POLICE FUND
YEAR ENDED SEPTEMBER 30, 2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Fines and forfeitures $ 240,000 $ 240,000 $ 969333 $ (143,667)
Investment and other 50 50 9,115 9,065
Total revenues 240,050 240,050 105,448 (134,602)
Expenditures-
Current-
Public safety-
Supplies and materials - 609 609 -
Capital outlay 402,397 401,788 244,165 157,623
Total expenditures 402,397 402,397 244,774 157,623
Net change in fund balances $ (162,347) $ (162,347) (139,326) $ 23,021
Fund balance,October 1,2016 139,341
Fund balance,September 30,2017 $ 15
134
CITY OF ROUND ROCK,TEXAS
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
PUBLIC EDUCATION & GOVERNMENT FUND
YEAR ENDED SEPTEMBER 30,2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues-
Taxes and franchise $ 240,000 $ 240,000 $ 228,498 $ (11,502)
Investment and other 50 50 11,103 11,053
Total revenues 240,050 240,050 239,601 (449)
Expenditures-
Current-
General Government-
Capital outlay 685,000 685,000 51,685 633,315
Total expenditures 685,000 685,000 51,685 633,315
Net change in fund balances $ (444,950) $ (444,950) 187,916 $ 632,866
Fund balance,October 1,2016 1,081,159
Fund balance,September 30,2017 $ 1,269,075
135
CITY OF ROUND ROCK,TEXAS
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES -BUDGET AND ACTUAL
TRAFFIC SAFETY PROGRAM FUND
YEAR ENDED SEPTEMBER 30,2017
Variance-
Budgeted Amounts Positive
Original Final Actual (Negative)
Expenditures-
Current-
Other services and charges $ 130,239 $ 130,239 $ 78 $ 130,161
Total expenditures 130,239 130,239 78 130,161
Excess(deficiency)of revenues over
expenditures (130,239) (130,239) (78) 130,161
Other financing sources(uses)-
Transfers in - - 100 100
Total other financing sources(uses) - - 100 100
Net change in fiend balances $ (130,239) $ (130,239) 22 $ 130,261
Fund balance,October 1,2016 190,875
Fund balance,September 30,2017 $ 190,897
136
CAPITAL ASSETS
USED IN THE OPERATION
OF GOVERNMENTAL FUNDS
137
CITY OF ROUND ROCK,TEXAS
SCHEDULE OF CAPITAL ASSETS FOR GOVERNMENTAL ACTIVITIES
SEPTEMBER 30,2017
Capital assets-
Land $ 82,456,114
Construction in progress 40,652,849
Buildings and improvements 801,665,286
Equipment 81,237,374
$ 1,006,011,623
Investment in capital assets from-
Capital projects funds-
General obligation bonds $ 314,365,644
Federal grants 4,631,065
State grants 1,008,753
General fund revenues 188,408,962
Special revenue fund revenues 163,123,505
Hotel occupancy tax revenues 45,567,733
Gifts 288,189,052
Special assessments 716,909
$ 1,006,011,623
138
STATISTICAL
SECTION
139
i
•
140
CITY OF ROUND ROCK,TEXAS
STATISTICAL SECTION
(UNAUDITED)
This part of the City of Round Rock's comprehensive annual financial report presents detailed information as a
context for understanding what the information in the financial statements, note disclosures, and supplementary
information says about the City's overall financial health. This information has not been audited by the independent
auditors.
Contents Page
Financial Trends
These schedules contain trend information to help the reader understand how the 142
City's financial performance and well-being have changed over time.
Revenue Capacity
These schedules contain information to help the reader assess the City's significant 152
local revenue sources,the property and sales tax.
Debt Capacity
These schedules present information to help the reader assess the affordability of the 162
City's currently outstanding debt and the City's ability to issue additional debt in the
future.
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader 171
Understand the environment within which the City's financial activities take place.
Operating Information
These schedules contain service and infrastructure data to help the reader understand 173
how the information contained in the City's financial report relates to the services the
City provides and the activities it performs.
Sources: Unless otherwise noted,the information in these schedules is derived from the City's comprehensive
annual financial reports for the relevant year.
141
CITY OF ROUND ROCK, TEXAS
NET POSITION BY COMPONENT
LAST TEN FISCAL YEARS
(accrual basis of accounting)
2008 2009 2010 2011
Governmental activities-
Net investment in capital assets $ 212,133,161 $ 244,059,034 $ 248,153,129 $ 245,403,528
Restricted 60,414,392 59,433,510 61,882,505 66,810,986
Unrestricted 77,912,630 74,490,409 76,111,460 77,864,804
Total governmental activities net position $ 350,460,183 $ 377,982,953 $ 386,147,094 $ 390,079,318
Business-type activities-
Net investment in capital assets $ 219,607,998 $ 217,990,010 $ 210,960,047 $ 213,536,543
Restricted 14,376,789 15,571,119 9,125,932 11,984,130
Unrestricted 53,228,109 66,770,620 85,930,757 95,693,542
Total business-type activities net position $ 287,212,896 $ 300,331,749 $ 306,016,736 $ 321,214,215
Primary government-
Net investment in capital assets $ 431,741,159 $ 462,049,044 $ 459,113,176 $ 458,940,071
Restricted 74,791,181 75,004,629 71,008,437 78,795,116
Unrestricted 131,140,739 141,261,029 162,042,217 173,558,346
Total primary government net position $ 637,673,079 $ 678,314,702 $ 692,163,830 $ 711,293,533
142
2012 2013 2014 2015 2016 2017
$ 252,984,681 $ 295,777,997 $ 303,977,353 $ 299,730,557 $ 310,185,706 $ 356,586,425
72,780,050 42,970,091 43,974,370 48,019,726 51,813,118 48,954,352
76,870,782 74,833,175 44,713,408 53,355,360 52,451,939 37,653,213
$ 402,635,513 $ 413,581,263 $ 392,665,131 $ 401,105,643 $ 414,450,763 $ 443,193,990
$ 212,883,311 $ 214,178,908 $ 221,062,599 $ 228,866,895 $ 234,981,264 $ 245,005,044
13,9949028 6,868,062 7,764,750 1.9,215,972 15,275,659 19,800,722
104,985,805 116,650,981 114,901,064 110,519,279 126,490,054 127,836,829
$ 331,863,144 $ 337,697,951 $ 343,728,413 $ 358,602,146 $ 376,746,977 $ 392,642,595
$ 465,867,992 $ 509,956,905 $ 525,039,952 $ 528,597,452 $ 545,166,970 $ 601,591,469
869774,078 49,838,153 51,739,120 67,235,698 67,088,777 68,755,074
181,856,587 191,484,156 159,614,472 163,874,639 178,941,993 165,490,042
$ 734,498,657 $ 751,279,214 $ 736,393,544 $ 759,707,789 $ 791,197,740 $ 835,836,585
143
CITY OF ROUND ROCK,TEXAS
CHANGES IN NET POSITION
LAST TEN FISCAL YEARS
(accrual basis of accounting)
2008 2009 2010 2011
Expenses:
Governmental activities-
General government $ 24,154,706 $ 24,856,934 $ 27,064,905 $ 28,487,648
Public safety 34,541,169 37,104,418 36,688,203 39,140,352
Public works 55,835,912 13,955,375 29,053,781 36,442,333
Culture and recreation 12,842,679 16,433,602 14,260,057 14,514,561
Interest on long-term debt 9,353,621 9,410,388 9,394,116 8,608,399
Issuance costs - - -
Total governmental activities expenses 136,728,087 101,760,717 116,461,062 127,193,293
Business-type activities-
Water and sewer utility 33,032,588 37,178,011 37,623,591 38,602,875
Golf course 185,659 182,521 192,595 174,149
Total business-type activities expenses 33,218,247 37,360,532 37,816,186 38,777,024
Total primary government expenses 169,946,334 139,121,249 154,277,248 165,970,317
Program revenues:
Governmental activities-
Charges for services-
General government 1,941,519 3,820,455 3,927,379 3,519,857
Public safety 3,197,900 3,646,892 4,150,577 4,295,283
Public works 1,295,783 877,676 836,169 2,032,530
Culture and recreation 2,721,570 2,503,925 2,531,989 3,136,422
Operating grants and contributions 1,097,733 1,064,411 932,879 1,130,628
Capital grants and contributions 3,825,335 14,083,063 7,634,857 9,257,876
Total governmental activities program revenues 14,079,840 25,996,422 20,013,850 23,372,596
Business-type activities-
Charges for services-
Water and sewer utility 35,060,024 37,802,909 37,512,213 44,922,715
Golf course 474,353 485,972 349,424 431,413
Capital grants and contributions 13,967,314 12,490,491 6,014,265 9,518,890
Total business-type activities program revenues 49,501,691 50,779,372 43,875,902 54,873,018
Total primary government program revenues 63,581,531 76,775,794 63,889,752 78,245,614
Net(expense)revenue-
Governmental activities (122,648,247) (75,764,295) (96,447,212) (103,820,697)
Business-type activities 16,283,444 13,418,840 6,059,716 16,095,994
Total primary government net expense $ (106,364,803) $ (62,345,455) $ (90,387,496) $ (87,724,703)
144
2012 2013 2014 2015 2016 2017
$ 30,406,768 $ 27,923,780 $ 28,050,936 $ 27,917,481 $ 28,204,761 $ 24,441,262
40,944,978 41,842,363 45,283,826 45,236,987 49,439,902 52,243,460
33,537,533 33,412,841 33,448,357 34,359,785
29,295,041 31,215,489
15,069,456 15,702,435 18,024,001 19,202,557 20,885,009 24,130,067
7,144,755 6,915,772 8,478,700 8,118,490 8,294,279 8,075,351
- - - 942,596 229,245 423,510
122,860,998 123,599,839 133,374,996 134,830,952 140,501,553 143,673,435
38,842,107 42,657,792 44,605,155 46,069,705 47,947,818 49,400,833
157,135 141,153 71,090 144,993 133,270 1,857,334
38,999,242 42,798,945 44,676,245 46,214,698 48,081,088 51,258,167
161,860,240 166,398,784 178,051,241 181,045,650 188,582,641 194,931,602
3,104,355 2,822,715 2,559,380 2,168,842 2,258,333 2,174,874
4,215,243 3,248,867 2,652,480 2,461,782 1,669,550 1,478,161
2,760,386 2,942,382 726,785 749,524 742,437 607,398
2,737,969 2,844,842 3,032,109 3,288,970 3,919,254 5,133,816
1,135,386 829,367 1,042,301 1,199,574 946,604 1,202,810
9,782,214 5,310,541 5,901,038 4,234,018 8,013,039 5,958,205
23,735,553 1.7,998,714 15,914,093 14,102,710 17,549,217 16,555,264
43,327,656 43,094,185 43,705,878 45,898,090 48,653,788 51,980,615
480,116 522,169 382,081 320,846 360,371 733,883
7,533,264 6,514,369 10,226,302 17,742,568 1.9,607,086 15,642,381
51,341,036 50,130,723 54,314,261 63,961,504 68,621,245 68,356,879
75,076,589 68,129,437 70,228,354 78,064,214 86,170,462 84,912,143
(99,125,445) (105,601,125) (117,460,903) (120,728,242) (122,952,336) (127,118,171)
12,341,794 7,331,778 9,638,016 17,746,806 20,540,157 17,098,712
$ (86,783,651) $ (98,2691347) $ (107,822,887) $ (102,981,436) $ (1021412,179) $ (110,019,459)
(CONTINUED)
145
CITY OF ROUND ROCK,TEXAS
CHANGES IN NET POSITION (CONTINUED)
LAST TEN FISCAL YEARS
(accrual basis of accounting)
2008 2009 2010 2011
General revenues and other changes
in net position:
Governmental activities-
Taxes-
Property $ 27,560,939 $ 29,867,765 $ 33,040,085 $ 33,578,991
Franchise 5,748,333 6,213,263 5,934,540 6,221,790
Sales 64,038,208 58,777,622 59,545,288 61,734,643
Hotel occupancy 2,939,352 2,394,145 2,291,326 2,684,046
Public service 286,179 315,739 327,723 352,159
Rent - - - -
Investment earnings and other 8,220,228 4,112,703 1,365,802 988,222
Miscellaneous 257,495 - - -
Transfers 2,291,695 1,605,828 2,106,589 2,193,070
Total governmental activities 111,342,429 103,287,065 104,611,353 107,752,921
Business-type activities-
Investment earnings 1,618,492 1,305,841 1,731,860 1,294,555
Transfers (2,291,695) (1,605,828) (2,106,589) (2,193,070)
Total business-type activities (673,203) (299,987) (374,729) (898,515)
Total primary government 110,669,226 102,987,078 104,236,624 106,854,406
Change in net position:
Governmental activities (11,305,818) 27,522,770 8,164,141 3,932,224
Business-type activities 15,610,241 13,118,853 5,684,987 15,197,479
Total primary government $ 4,304,423 $ 40,641,623 $ 13,849,128 $ 19,129,703
146
2012 2013 2014 2015 2016 2017
$ 34,379,529 $ 34,979,578 $ 36,502,409 $ 39,932,573 $ 44,239,067 $ 49,107,424
6,326,735 5,952,712 6,460,448 7,255,212 7,175,948 7,103,548
63,305,917 66,216,447 68,462,292 67,620,848 67,340,120 64,209,719
3,252,542 4,140,920 4,646,208 5,083,556 5,407,667 5,515,163
316,320 347,846 477,606 515,778 566,712 627,164
- - - - - 17,603,565
1,635,630 2,026,554 1,882,139 5,020,786 7,957,942 8,201,944
2,464,967 2,882,818 1,800,895 3,740,000 3,610,000 3,492,871
111,681,640 116,546,875 120,231,997 129,168,753 136,297,456 155,861,398
772,102 1,385,847 1,397,321 866,927 1,214,674 2,289,777
(2,464,967) (2,882,818) (1,800,895) (3,740,000) (3,610,000) (3,492,871)
(1,692,865) (1,496,971) (403,574) (2,873,073) (2,395,326) (1,203,094)
109,988,775 115,049,904 119,828,423 126,295,680 133,902,130 154,658,304
12,556,195 10,945,750 2,771,094 8,440,511 13,345,120 28,743,227
10,648,929 5,834,807 9,234,442 14,873,733 18,144,831 15,895,618
$ 23,205,124 $ 16,780,557 $ 12,005,536 $ 23,314,244 $ 31,489,951 $ 44,638,845
147
CITY OF ROUND ROCK,TEXAS
FUND BALANCES OF GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(modified accrual basis of accounting)
2008 2009 2010 2011
Nonspendable-
Inventories,prepaids and other $ - $ - $ - $ 288,758
Restricted for-
Debt service 3,431,063 2,887,281 1,944,761 2,238,270
Authorized construction 104,541,402 9000,407 88,064,514 88,021,123
Hotel-motel tax 6,368,822 7,005,856 7,314,509 8,114,729
Public safety 521,354 497,243 862,273 1,024,405
General government - - - -
Committed to-
General government 158,190 158,886 158,990 901,229
Capital projects funds 34,543,559 31,250,099 33,739,591 35,731,396
Streets and drainage - - - 573,809
Culture and recreation 15,164 14,302 11,176 11,239
Assigned to-
Culture and recreation 788,440 574,093 571,705 542,779
Unassigned 36,415,765 36,785,055 36,857,155 36,238,854
Total governmental funds $ 186,783,759 $ 169,173,222 $ 169,524,674 $ 173,686,591
148
2012 2013 2014 2015 2016 2017
$ 321,044 $ 375,087 $ 397,271 $ 430,821 $ 372,288 $ 232,004
2,301,340 2,415,427 2,278,062 2,351,780 2,749,645 3,880,982
81,424,206 43,630,036 106,539,802 117,515,606 77,545,478 81,086,426
8,927,441 9,549,082 11,173,765 10,934,476 12,653,710 6,526,672
937,105 1,249,246 1,050,349 1,274,293 676,724 585,878
- - - - - 1,269,075
911,674 865,493 684,199 856,977 1,081,159 124,703
35,645,374 31,856,334 26,570,024 24,696,122 24,865,777 28,397,665
1,179,777 1,570,994 - 1,145,826 1,152,195 -
6,625 10,530 12,438 322,576 293,694 -
248,771 283,518 264,662 272,666 212,080 1,004,583
36,912,381 38,604,781 38,726,365 50,277,389 52,427,796 50,090,080
$ 168,815,738 $ 130,410,528 $ 187,696,937 $ 210,078,532 $ 174,030,546 $ 173,198,068
149
CITY OF ROUND ROCK, TEXAS
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(modified accrual basis of accounting)
2008 2009 2010 2011
Revenues-
Taxes and franchise $ 97,759,902 $ 95,097,743 $ 98,990,298 $ 101,914,916
Licenses,permits and fees 1,593,711 1,053,959 907,705 2,155,358
Charges for services 3,895,886 3,757,215 3,767,565 3,985,634
Fines and forfeitures 2,014,379 2,057,353 2,260,401 2,492,261
Intergovernmental 1,317,506 1,232,594 3,953,092 3,302,276
Hotel occupancy tax 2,939,352 2,394,145 2,291,326 2,684,046
Investment and other 9,977,103 8,406,513 3,652,629 3,786,134
Contributions 2,094,375 1,729,637 972,641 3,282,812
Total revenues 121,592,214 115,729,159 116,795,657 123,603,437
Expenditures-
General government 22,858,670 22,640,290 22,874,155 24,346,515
Public safety 32,949,754 34,099,601 34,539,844 36,556,318
Public works 9,360,999 10,065,601 9,565,430 8,797,799
Culture and recreation 11,693,213 11,813,663 11,157,995 11,336,602
Capital projects 53,298,559 38,798,458 21,184,635 22,981,288
Debt service-
Principal retirement 10,448,506 10,942,820 11,456,810 11,815,968
Interest and fiscal charges 9,060,707 9,290,481 9,097,057 8,072,821
Payment to refunding agent - - - -
Other charges - - 1,327,989 247,433
Total expenditures 149,670,408 137,650,914 121,203,915 124,154,744
Excess of revenues
over(under)expenditures (28,078,194) (21,921,755) (4,408,258) (551,307)
Other financing sources(uses)-
Issuance of lease 750,000 1,505,390 1,310,569 1,372,023
Issuance of debt 16,798,622 - 18,575,000 16,145,000
Premium on bonds issued - - 1,387,593 223,248
Payment to refunded bond escrow agent - - (19,682,356) (16,083,357)
Transfers in 26,429,303 33,385,722 24,459,490 27,752,457
Transfers out (24,137,608) (30,579,894) (21,290,586) (24,696,147)
Total other financing sources(uses) 19,840,317 4,311,218 4,759,710 4,713,224
Net change in find balances $ (8,237,877) $ (17,610,537) $ 351,452 $ 4,161,917
Capital outlay including amounts reported $ 53,298,559 $ 40,000,535 $ 22,684,310 $ 23,932,697
under departmental current expenditures
Debt service as a percentage of 20.2% 20.7% 20.9% 19.8%
noncapital expenditures
150
2012 2013 2014 2015 2016 2017
$ 104,318,270 $ 107,417,612 $ 111,592,909 $ 115,508,506 $ 119,211,433 $ 121,142,245
3,094,983 3,567,437 1,243,857 1,704,374 1,843,633 1,646,077
4,198,815 4,436,779 4,645,527 4,513,428 5,172,465 6,307,377
2,814,987 3,208,637 2,673,670 2,451,316 1,573,476 1,440,795
2,158,621 1,225,195 3,044,095 1,679,993 990,683 2,950,833
3,252,543 4,140,920 4,646,208 5,083,556 5,407,667 5,515,163
2,635,613 3,565,842 4,783,567 7,207,478 7,963,854 8,253,614
5,858,346 2,567,327 3,152,100 600,919 368,748 931,601
128,332,178 130,129,749 135,781,933 138,749,570 142,531,959 148,187,705
25,332,577 23,783,735 24,375,794 23,838,520 24,394,392 21,055,932
37,646,821 39,475,791 42,306,841 43,067,272 44,388,881 47,595,884
9,791,618 11,852,443 11,291,499 12,328,284 12,062,839 12,682,503
11,958,179 12,440,948 13,775,702 14,766,040 15,078,964 17,219,700
39,916,082 65,523,775 38,694,239 33,476,554 65,414,999 63,268,686
13,040,604 12,852,059 14,395,697 13,919,366 13,463,922 13,287,160
6,825,065 6,797,281 7,372,652 8,597,372 9,641,498 8,306,767
- - - - - 10,050,443
256,373 98,630 862,888 942,596 229,245 423,510
144,767,319 172,824,662 153,075,312 150,936,004 184,674,740 193,890,585
(16,435,141) (42,694,913) (17,293,379) (12,186,434) (42,142,781) (45,702,880)
500,000 1,000,000 1,450,000 2,000,000 2,250,000 -
27,295,000 8,615,000 77,350,000 70,665,000 11,450,000 38,725,000
1,317,881 - 6,161,887 6,369,020 1,094,690 2,652,531
(20,616,784) (8,509,756) (11,682,994) (48,205,991) (12,309,895) -
34,447,300 49,547,722 32,984,237 27,070,865 30,552,126 31,908,470
(31,379,109) (46,363,263) (31,683,342) (23,330,865) (26,942,126) (28,415,599)
11,564,288 4,289,703 74,579,788 34,568,029 6,094,795 44,870,402
$ (4,870,853) $ (38,405,210) $ 57,286,409 $ 22,381,595 $ (36,047,986) $ (832,478)
$ 41,282,292 $ 67,059,226 $ 38,644,877 $ 35,385,140 $ 65,116,395 $ 90,020,515
19.2% 18.6% 1.9.0% 19.5% 19.3% 23.0%
151
CITY OF ROUND ROCK, TEXAS
ACTUAL AND TAXABLE ASSESSED VALUE OF PROPERTY
LAST TEN FISCAL YEARS
Actual Assessed Value Less: Total
Taxable
Fiscal Real Personal Tax Exempt Assessed Total Direct
Year Property Property Total Property Valuation Tax Rate
2008 $ 6,954,733,744 $ 852,374,495 $ 7,807,108,239 $ $ 303,674,692 $ 7,503,433,547 $ 0.3652
2009 7,623,482,042 957,142,673 8,580,624,715 386,156,997 8,194,467,718 0.3652
2010 7,843,041,122 880,412,269 8,723,453,391 401,156,676 8,322,296,715 0.3966
2011 7,581,182,068 831,489,169 8,412,671,237 395,522,799 8,017,148,438 0.4173
2012 7,654,036,144 850,976,608 8,505,012,752 408,354,355 8,096,658,397 0.4232
2013 7,837,387,397 947,316,007 8,784,703,404 493,653,067 8,291,050,337 0.4204
2014 8,195,046,631 1,062,520,327 9,257,566,958 567,914,523 8,689,652,435 0.4195
2015 9,193,035,124 1,030,331,518 10,223,366,642 589,210,216 9,634,156,426 0.4146
2016 10,040,964,402 1,018,628,138 11,059,592,540 567,506,618 10,492,085,922 0.4147
2017 10,935,482,664 1,031,249,775 11,966,732,439 639,556,585 11,327,175,854 0.4250
Source: Williamson Central Appraisal District/Travis Central Appraisal District
Note-Property in the City is assessed each year. Property is assessed at actual value;therefore,the assessed
values are equal to actual value. Tax rates are per$100 of assessed value.
152
CITY OF ROUND ROCK,TEXAS
PROPERTY TAX RATES -DIRECT AND OVERLAPPING GOVERNMENTS
PER$100 OF ASSESSED VALUE
LAST TEN FISCAL YEARS
City Direct Rates Overlapping Rates
Round Rock Total
Independent Direct and
Fiscal Operating Debt Service Total School Williamson Special Overlapping
Year Rate Rate Direct District County Districts Rates
2008 $ 0.1960 $ 0.1692 $ 0.3652 $ 1.3238 $ 0.4891 $ 0.0200 $ 2.1981
2009 0.2171 0.1481 0.3652 1.3324 0.4683 0.1154 2.2813
2010 0.2491 0.1475 0.3966 1.3800 0.4900 0.1146 2.3812
2011 0.2665 0.1508 0.4173 1.3800 0.4900 0.1151 2.4024
2012 0.2751 0.1481 0.4232 1.3350 0.4877 0.1148 2.3607
2013 0.2830 0.1373 0.4203 1.3800 0.4890 0.1151 2.4044
2014 0.2800 0.1395 0.4195 1.3674 0.4890 0.1149 2.3908
2015 0.2628 0.1518 0.4146 1.3375 0.4865 0.1142 2.3528
2016 0.2545 0.1602 0.4147 1.3325 0.4815 0.1205 2.3492
2017 0.2719 0.1531 0.4250 1.3325 0.4765 0.1220 2.3560
Source: Williamson County Tax Office
153
CITY OF ROUND ROCK, TEXAS
PRINCIPAL PROPERTY TAXPAYERS
CURRENT YEAR AND NINE YEARS AGO
2017 2008
%of Total %of Total
Net Net Net Net
Assessed Assessed Assessed Assessed
Name of Taxpayer Valuation Rank Valuation Valuation Rank Valuation
Dell Computer Holdings, LP $ 339,097,490 1 2.994% $ 195,290,162 1 2.603%
CPG Round Rock, LP/
Round Rock Premium Outlets 142,423,939 2 1.257 108,535,031 2 1.446
Baltgem Development Corp./
La Frontera Village 76,071,273 3 0.672 89,155,876 3 1.188
CMF 15 Portfolio,LLC/
Colonial Grand Apartments 73,097,054 4 0.645 - -
Columbia/St. David Healthcare 71,894,919 5 0.635 55,449,016 5 0.739
Dell Computer Corp 61,308,621 6 0.541 55,082,430 6 0.734
Baev-LaSalle Round Rock
University Blvd, LLC 53,098,990 7 0.469 - -
FST La Frontera LLC 52,515,178 8 0.464 - -
Fisher-Rosemount Systems, Inc. 52,250,000 9 0.461 - -
Lodge MultiFamily Austin LP 47,120,343 10 0.416 - -
Scott& White Memorial Hospital - - 71,824,805 4 0.957
Toppan Photomasks, Inc. - - 46,624,323 7 0.621
TXU Electric Delivery Co. - - 40,237,994 8 0.536
Drever,Limestone, LP - - 33,621,294 9 0.448
2800 La Frontera#I A, LTD - - 32,309,217 10 0.431
$ 968,877,807 8.554% $ 728,130,148 9.703%
Source: Williamson Central Appraisal District
154
CITY OF ROUND ROCK, TEXAS
PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN FISCAL YEARS
Collected within the
Fiscal Year of the Levy Total Collections to Date
Taxes Levied Collections
Fiscal for the Percentage in Subsequent Percentage
Year Fiscal Year Amount Of Levy Years Amount Of Levy
2008 $ 27,220,757 $ 27,194,031 99.90% $ 574 $ 27,194,605 99.90 %
2009 29,931,048 29,745,017 99.38 1,594 29,746,611 99.38
2010 33,001,196 32,822,350 99.46 1,771 32,824,121 99.46
2011 33,469,184 33,330,239 99.58 2,149 33,332,388 99.59
2012 34,255,559 34,161,567 99.73 3,049 34,164,616 99.73
2013 34,865,783 34,717,536 99.57 3,319 34,720,855 99.58
2014 36,452,223 36,281,479 99.53 (2,892) 36,278,587 99.52
2015 39,792,302 39,697,745 99.76 7,401 39,705,146 99.78
2016 44,063,923 43,894,949 99.62 27,973 43,922,922 99.68
2017 49,113,540 48,988,540 99.75 - 48,988,540 99.75
155
CITY OF ROUND ROCK,TEXAS
SALES TAX AND AD VALOREM TAX
LAST TEN FISCAL YEARS
Total 1% % of Equivalent 1%
Fiscal Sales Tax Ad Valorem Ad Valorem of Ad Valorem Sales Tax
Year Collected Tax Levy Tax Levy Tax Rate Population Per Capita
2008 $ 34,064,751 $ 27,220,757 125.14% $ 0.4540 96,200 $ 354
2009 30,849,792 29,931,048 103.07 0.3765 99,500 310
2010 30,758,801 33,001,196 93.21 0.3696 99,887 308
2011 31,306,675 33,469,184 93.54 0.3905 100,659 311
2012 31,652,958 34,255,559 92.40 0.3909 101,702 311
2013 33,108,223 34,865,783 94.96 0.3993 102,349 323
2014 34,231,146 36,452,223 93.91 0.3939 103,107 332
2015 33,810,424 39,792,302 84.97 0.3509 105,405 321
2016 33,670,060 44,063,923 76.41 0.3209 106,591 316
2017 34,970,879 49,113,540 71.20 0.3087 108,353 323
Note: The City has adopted the Municipal Sales and Use Tax Act,Texas Tax Code,Chapter 321, which
grants the City the power to impose and levy a 1%Local Sales and Use Tax within the City;the proceeds
are credited to the General Fund and are not pledged to the payment of the bonds. Collections and
enforcements are effected through the office of the Texas Comptroller of Public Accounts who remits the
proceeds of the tax,after deduction of a 2%service fees,to the City monthly.
The calculations above are only based on the 1% sales and use tax,not the 1/2%sales and use tax
collected for reduction of ad valorem taxes and 1/2%sales and use tax collected for transportation
improvements.
156
«
157
CITY OF ROUND ROCK,TEXAS
TAMABLE SALES BY CATEGORY
LAST TEN CALENDAR YEARS
Calendar Retail Wholesale
Year Trade Manufacturing Services Trade Utilities
2007 $ 1,164,629,997 $ 1,451,958,775 $ 307,961,994 $ 145,020,854 $ 19,249,383
2008 1,169,189,726 1,075,483,223 331,119,293 179,784,677 16,648,480
2009 1,101,311,223 990,398,877 324,328,200 145,345,099 16,322,477
2010 1,070,089,059 1,111,487,638 331,304,579 117,424,010 17,788,882
2011 1,107,689,836 1,095,938,383 346,422,899 85,234,726 22,224,004
2012 1,228,352,605 985,127,289 381,294,220 99,025,592 26,448,906
2013 1,399,874,606 1,103,790,424 402,483,896 131,162,463 29,351,784
2014 1,529,469,558 1,061,444,585 432,758,149 128,755,561 34,412,553
2015 1,556,013,209 951,496,554 476,798,645 123,940,513 41,822,044
2016 1,592,542,371 905,719,610 505,372,604 141,775,154 41,190,339
$ 12,919,162,1.90 $ 10,732,845,358 $ 3,839,844,479 $ 1,297,468,649 $ 265,458,852
Source: Texas Comptroller of Public Accounts
Note: Sales information is not available on a fiscal year basis. Also,due to State of Texas confidentiality rules,
names of sales tax payers are not available. The categories presented provide alternative information indicative of
sales tax revenue sources.
158
City
Direct State
Finance, Sales Tax Sales Tax Over-
Construction Insurance Total Rate Rate lapping
$ 47,674,780 $ 1,793,374 $ 3,138,289,157 2.00% 6.25% 8.25%
46,245,654 1,639,355 2,820,110,408 2.00 6.25 8.25
30,440,097 2,160,587 2,610,306,560 2.00 6.25 8.25
46,023,961 2,114,837 2,696,232,966 2.00 6.25 8.25
61,286,941 3,006,901 2,721,803,690 2.00 6.25 8.25
70,736,973 2,846,478 2,793,832,063 2.00 6.25 8.25
90,125,307 2,368,176 3,159,156,656 2.00 6.25 8.25
95,799,482 2,497,918 3,285,137,806 2.00 6.25 8.25
110,293,477 2,600,258 3,262,964,700 2.00 6.25 8.25
135,370,923 2,951,985 3,324,922,986 2.00 6.25 8.25
$ 733,997,595 $ 23,979,869 $ 29,812,756,992
159
CITY OF ROUND ROCK, TEXAS
HOTEL TAXPAYERS
SEPTEMBER 30,2017
Hotel Motel Hotel Motel Total Collections
Occupancy Occupancy Year Ended Number of %of Total
Taxpayer Tax Venue Tax September 30,2017 Rooms Collections
Austin Marriott North $ 671,550 $ 191,872 $ 863,422 295 15.7%
Homewood Suites 312,192 89,198 401,390 115 7.3
Hilton Garden Inn 249,817 71,376 321,193 122 5.8
Home 2 Suites 218,318 62,376 280,694 91 5.1
Courtyard by Marriott 215,731 61,637 277,368 113 5.0
Residence Inn 215,327 61,522 276,849 96 5.0
Hampton Inn 207,415 59,262 266,677 93 4.8
Springhill Suites 194,918 55,691 250,609 104 4.5
Holiday Inn 180,496 51,570 232,066 116 4.2
Holiday Inn Express N 170,138 48,611 218,749 91 4.0
La Quinta Inn 138,301 39,515 177,816 116 3.2
Wingate Inn 133,533 38,152 171,685 100 3.1
Red Roof Inn 117,436 33,552 150,988 107 2.7
Baymont Inn 117,021 33,435 150,456 96 2.7
Microtel Inn&Suites 104,651 29,899 134,550 82 2.4
Holiday Inn Express S 99,251 28,343 127,594 109 2.3
Best Western Executive Inn 97,780 27,929 125,709 64 2.3
Sleep Inn 97,258 27,788 125,046 74 2.3
Motel 6 83,200 23,771 106,971 59 1.9
Extended Stay America#6030 81,198 23,200 104,398 138 1.9
Staybridge Suites 79,962 22,846 102,808 81 1.9
Extended Stay America#6197 77,327 22,093 99,420 104 1.8
Candlewood Suites 75,693 21,627 97,320 98 1.8
Comfort Suites 74,072 21,163 95,235 63 1.7
Country Inn&Suites 68,662 19,618 88,280 63 1.6
Value Place(Woodsprings) 68,606 19,602 88,208 121 1.6
Days Inn&Suites 60,705 17,339 78,044 48 1.4
Hyatt Place North 54,059 15,445 69,504 138 1.3
Towne Place Suites 19,776 5,650 25,426 102 0.5
VRBO Homes 4,548 1,299 5,847 4 0.1
Provident Crossing Retirement 656 187 843 2 0.1
$ 4,289,597 $ 1,225,568 $ 5,515,165 3,005 100.0%
160
CITY OF ROUND ROCK, TEXAS
HOTEL OCCUPANCY TAX COLLECTION HISTORY BY QUARTER
LAST TEN FISCAL YEARS
Fiscal
Year
Ended 1 st Quarter 2nd Quarter 3rd Quarter 4th Quarter
9-30 Oct.—Dec. Jan.—Mar. Apr.—June July—Sept. Total
2008 $ 669,345 $ 749,897 $ 806,813 $ 713,297 $ 2,939,352
2009 609,608 589,006 640,846 554,685 2,394,145
2010 504,062 582,719 661,356 543,189 2,291,326
2011 684,430 678,090 716,629 604,897 2,684,046
2012 610,280 835,331 1,004,705 802,227 3,252,543
2013 964,181 1,091,350 1,152,982 932,407 4,140,920
2014 1,071,926 1,217,483 1,271,649 1,085,150 4,646,208
2015 1,114,213 1,274,209 1,437,121 1,258,012 5,083,555
2016 1,214,093 1,354,383 1,570,064 1,269,127 5,407,667
2017 1,249,406 1,411,265 1,509,276 1,345,218 5,515,165
161
CITY OF ROUND ROCK, TEXAS
RATIOS OF OUTSTANDING DEBT BY TYPE
LAST TEN FISCAL YEARS
Business-Type
Governmental Activities Activities
General Percentage
Fiscal Obligation Certificates of Other Debt Revenue Total Primary of Personal Per
Year Bonds Obligation Obligations Bonds Government Income Capita
2008 $ 120,060,000 $ 15,300,000 $ 73,598,054 $ 8,290,000 $ 217,248,054 7.67% $ 2,258
2009 115,725,000 14,475,000 69,270,163 11,555,000 211,025,163 7.10 2,121
2010 110,470,000 13,530,000 65,830,308 91,166,635 280,996,943 9.16 2,813
2011 105,980,000 12,965,000 60,691,660 89,888,648 269,525,308 8.63 2,678
2012 101,185,000 12,380,000 62,571,173 87,765,660 263,901,833 8.27 2,595
2013 96,340,000 11,770,000 56,131,110 85,392,673 249,633,783 7.56 2,439
2014 155,780,000 11,135,000 55,963,734 90,799,894 313,678,628 9.12 3,042
2015 154,925,000 29,675,000 56,701,818 87,827,948 329,129,766 10.00 3,123
2016 149,540,000 27,095,000 52,746,502 89,364,624 318,746,126 6.43 2,990
2017 170,615,000 26,315,000 49,477,613 86,027,443 332,435,056 6.87 3,068
Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements.
See the Schedule of Demographic and Economic Statistics for personal income and population data.
162
CITY OF ROUND ROCK,TEXAS
RATIOS OF NET GENERAL BONDED DEBT OUTSTANDING
TO ASSESSED VALUE AND NET BONDED DEBT PER CAPITA
LAST TEN FISCAL YEARS
Ratio of Net
Fiscal Amount Bonded Net
Year Net Assessed Gross Available in Debt to Bonded
Ended (1) Value(in Bonded Debt Service Net Bonded Assessed Debt Per
9-30 Population thousands) Debt Fund Debt Value Capita
2008 96,200 $ 7,503,434 $ 132,716,787 $ 3,431,063 $ 129,285,724 1.72% $ 1,344
2009 99,500 8,194,468 127,721,445 2,887,281 124,834,164 1.52 1,255
2010 99,887 8,322,297 123,017,131 1,944,761 121,072,370 1.45 1,212
2011 100,659 8,017,148 118,122,822 2,238,270 115,884,552 1.45 1,151
2012 101,702 8,096,658 114,268,570 2,301,340 111,967,230 1.38 1,101
2013 102,349 8,291,050 108,241,436 2,415,427 105,826,009 1.28 1,034
2014 103,107 8,689,652 172,890,871 2,278,062 170,612,809 1.96 1,655
2015 105,405 9,634,156 181,245,000 2,351,780 178,893,220 1.86 1,697
2016 106,591 10,492,086 173,280,000 2,749,645 170,530,355 1.63 1,600
2017 108,353 11,327,176 196,930,000 3,880,982 193,049,018 1.70 1,782
Note: Includes Certificates of Obligation and General Obligation Bonds.
(1) Source: Planning Department, City of Round Rock
163
a«RYt♦•SRR*R�R�
RR *�
R
R'# •RR�
�� Reee•+RReMee��reee*'�«ReeRs
164
CITY OF ROUND ROCK,TEXAS
COMPUTATION OF DIRECT AND OVERLAPPING BONDED DEBT
SEPTEMBER 30,2017
Total ** Estimated
General Estimated Share of
Debt Percentage Overlapping
Name of Governmental Unit Outstanding Applicable Debt
Debt repaid with property taxes-
Williamson County $ 872,279,942* 20.25% $ 176,636,688
Round Rock Independent
School District 727,880,000* 35.24 256,504,912
Travis County 684,531,179* 0.24 1,642,875
Georgetown ISD 3-15,655,000* 0.19 637,745
Austin Community College 297,583,965* 5.96 17,736,004
Travis County Healthcare District 10,380,000* 0.22 22,836
Subtotal, overlapping debt 453,181,060
City direct debt 246,407,613
Total direct and overlapping debt $ 699,588,673
* Gross Debt as of September 30, 2017
** The percentage of overlapping debt applicable is estimated using taxable assessed property values.
Source: City of Round Rock Finance Department and Texas Municipal Reports
Note: Overlapping governments are those that coincide,at least in part, with the geographic boundaries of the
City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne
by the residents and businesses of the City of Round Rock, Texas. This process recognizes that,when
considering the government's ability to issue and repay long-term debt, the entire debt borne by the residents and
businesses should be taken into account. However,this does not imply that every taxpayer is a resident, and
therefore responsible for repaying the debt, of each overlapping government.
165
CITY OF ROUND ROCK, TEXAS
LEGAL DEBT MARGIN INFORMATION
LAST TEN FISCAL YEARS
2008 2009 2010 2011
Debt limit $ 1,345,033,513 $ 1,468,905,352 $ 1,491,819,433 $ 1,437,119,854
Total net debt applicable to limit 126,786,525 122,512,295 117,540,239 112,406,730
Legal debt margin $ 1,218,246,988 $ 1,346,393,057 $ 1,374,279,194 $ 1,324,713,124
Total net debt applicable to the limit
as a percentage of debt limit 9.43% 8.34% 7.88% 7.82%
Legal Debt Margin Calculation for Fiscal Year 2017
Total assessed value $ 11,327,175,854
Debt limit-Maximum serviceable at permitted allocation
of$1.50 per$100 of assessed value $ 1,928,938,196
Amount of debt applicable to debt limit:
Total General Obligation Debt $ 196,930,000
Less:
Amount available in Debt Service Fund (3,880,982)
Total net debt applicable to debt limit 193,049,018
Legal debt margin $ 1,735,889,178
There is no direct debt limitation in the City Charter or under state law. The City operates under a Home Rule Charter
(Article XI, Section 5,Texas Constitution),approved by voters in August 1977,that limits the maximum tax rate,for all City
purposes,to$2.50 per$100 assessed valuation.Administratively,the Attorney General of the State of Texas will permit
allocation of$1.50 of the$2.50 maximum tax rate for general obligation debt service.
Assuming the maximum tax rate for debt service of$1.50 on January 1,2016,assessed valuation of$11,327,175,854 at
100%collection,tax revenue of$169,907,638 would be produced. This revenue could service the debt on$ 1,928,938,196
issued as 20-year serial bonds at 5.50%(with level debt service payment).
Interest and Sinking Fund Budget Projection
General Obligation Debt Service Requirements,Fiscal Year 2018 $ 17,114,930
Tax Year 2017 Interest and Sinking Fund Tax Levy @ 99%Collection $ 17,300,000
Interest and Sinking Fund Balance as of 9-30-17 3,880,982
21,180,982
Estimated Balance,9-30-18 $ 4,066,052
166
2012 2013 2014 2015 2016 2017
$ 1,451,372,470 $ 1,486,218,341 $ 1,557,670,054 $ 1,640,628,922 $ 1,786,728,268 $ 1,928,938,196
107,568,660 101,824,573 161,006,938 178,893,220 170,530,355 193,049,018
$ 1,343,803,810 $ 1,384,393,768 $ 1,396,663,116 $ 1,461,735,702 $ 1,616,197,913 $ 1,735,889,178
7.41% 6.85% 10.34% 10.90% 9.54% 10.01%
167
CITY OF ROUND ROCK,TEXAS
CONDENSED UTILITY STATEMENT OF OPERATIONS
LAST TEN FISCAL YEARS
2008 2009 2010 2011
Gross Revenue(1)
Charges for services $ 35,060,024 $ 37,802,909 $ 37,512,213 $ 44,922,715
Licenses,permits and fees - - - 1,114,142
Interest income and other 1,569,165 1,292,130 1,728,177 1,292,672
Total 36,629,189 39,095,039 39,240,390 47,329,529
Direct Operating Expense(2)
Personnel services 6,354,652 7,258,877 7,479,392 8,576,547
Contracted services 14,161,138 15,790,749 11,305,080 9,839,091
Materials and supplies 1,765,297 1,785,769 1,652,634 2,055,399
Heat,light and power 2,267,989 2,521,364 1,806,175 2,474,391
Total 24,549,076 27,356,759 22,243,281 22,945,428
Net available for Debt Service $ 12,080,113 $ 11,738,280 $ 16,997,109 $ 24,384,101
Debt Service Requirements(P&I) $ 153,666 $ 568,400 $ 4,007,882 $ 5,081,298
Revenue Bond Coverage 77.39 20.65 4.24 4.79
Metered Water Customers 29,750 30,001 30,362 30,676
Metered Sewer Customers 29,171 29,407 29,759 30,061
Average Annual Principal and Interest Requirements,2018-2039 $ 5,470,864
Coverage of Average Requirements by fiscal 2017 Net Revenue 4.50 times
Estimated Maximum Principal and Interest Requirements,2018 $ 6,343,554
Estimated Coverage of Maximum Requirements by 2017 Net Revenue 3.88 times
Parity Debt Outstanding at FY2017 $ 81,570,000
(1) Water and Sewer Fund operating and non-operating revenues
(2) Water and Sewer Fund operating expenses,excluding depreciation
168
2012 2013 2014 2015 2016 2017
$ 43,327,656 $ 43,094,185 $ 40,762,523 $ 41,880,906 $ 44,406,721 $ 47,769,478
1,921,789 1,941,121 2,943,355 4,017,184 4,247,067 4,211,137
770,977 1,385,965 1,397,259 863,900 1,211,532 2,284,171
46,020,422 46,421,271 45,103,137 46,761,990 49,865,320 54,264,786
8,599,771 8,634,094 8,939,263 9,228,272 9,742,128 10,669,214
9,913,713 14,335,824 14,200,624 14,500,269 15,222,355 14,854,212
2,106,220 1,890,480 2,163,731 1,837,026 2,091,331 2,504,640
1,966,864 1,951,428 1,829,036 1,783,408 1,662,779 1,618,297
22,586,568 26,811,826 27,132,654 27,348,975 28,718,593 29,646,363
$ 23,433,854 $ 19,609,445 $ 17,970,483 $ 19,413,015 $ 21,146,727 $ 24,618,423
$ 5,893,953 $ 6,101,113 $ 6,347,632 $ 6,894,788 $ 5,994,842 $ 6,352,459
3.87 3.13 2.83 2.82 3.53 3.88
30,989 31,431 32,012 32,447 32,930 34,179
30,359 30,766 31,133 31,531 31,984 33,186
169
*MI�Nrr
NN NN
NN Nr
•
WOO
NM�k N iLl7
N
170
CITY OF ROUND ROCK, TEXAS
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN FISCAL YEARS
(4) (2) (3) (2)
Fiscal (1) Personal Per Capita Median School Unemployment
Year Population Income Income Age Enrollment Rate
2008 96,200 $ 2,831,069,800 $ 29,429 31.2 41,489 4.2%
2009 99,500 2,971,866,000 29,868 31.2 41,867 6.4
2010 99,887 3,038,262,879 30,417 31.4 42,683 6.2
2011 100,659 3,096,874,794 30,766 31.6 44,331 6.1
2012 101,702 3,164,864,538 31,119 32.0 45,000 5.9
2013 102,349 3,221,434,775 31,475 32.0 45,361 5.0
2014 103,107 3,282,514,452 31,836 31.7 45,924 4.2
2015 105,405 4,104,259,890 38,938 33.5 47,093 3.2
2016 106,591 4,636,495,318 43,498 33.9 47,580 3.3
2017 108,353 4,841,103,687 44,679 34.4 48,121 3.0
Sources: (1) Planning Department, City of Round Rock
(2) Round Rock Chamber of Commerce
(3) Round Rock Independent School District
(4) U.S. Dept. of Commerce/Bureau of Economic Development; data is for Williamson County, which
is representative of the City; data for City not available.
171
CITY OF ROUND ROCK,TEXAS
PRINCIPAL EMPLOYERS
CURRENT YEAR AND NINE YEARS AGO
2017 2008
%of Total %of Total
City City
Name of Employer Employees Rank Employment Employees Rank Employment
Dell Technologies 12,000 1 19.05% 9,000 1 17.95%
Round Rock Independent School District 5,800 2 9.21 5,200 2 10.37
City of Round Rock,Texas 956 3 1.52 831 4 1.66
Emerson Process Management 875 4 1.39
Round Rock Premium Outlets 800 5 1.27
Scott&White Healthcare 750 6 1.19 600 7 1.20
Round Rock Medical Center 689 7 1.09 710 5 1.42
Liquidation Channel 600 8 0.95
Sears Telesery 600 9 0.95 1,300 3 2.59
Wayne,a GE Energy Business 550 10 0.87 550 8 1.10
Texas Guaranteed Student Loan 485 11 0.77 700 6 1.40
Seton Medical Center Williamson 450 12 0.71
Field Asset Services 440 13 0.70
AirCo Mechanical 375 14 0.60
Michael Angelo's Gourmet Food 370 15 0.59 350 10 0.70
ProPortion Foods 325 15 0.52
Chasco Constructors 300 16 0.48
TECO-Westinghouse Motor Company 300 17 0.48
Toppan Photomask 250 18 0.40 368 9 0.73
26,915 42.74% 19,609 39.12
Source: City of Round Rock Finance Department/Round Rock Chamber of Commerce
172
CITY OF ROUND ROCK, TEXAS
FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION
LAST TEN FISCAL YEARS
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Function:
General government 176 173 176 164 164 164 171 174 180 183
Public safety-
Police-
Officers 146 151 152 152 154 153 160 167 168 177
Civilians 62 61 61 67 67 68 64 67 72 71
Fire-
Firefighters&officers 124 124 124 124 124 124 129 129 132 134
Civilians 5 5 5 5 5 6 8 8 8 8
Public works-
Street&Drainage 48 48 48 48 48 55 55 54 59 69
Shop 15 15 15 15 15 15 16 18 19 18
Culture&Recreation-
Library 29 29 29 29 29 30 31 31 31 31
Parks&Recreation 95 97 98 94 94 91 91 91 106 102
Water 95 96 97 91 91 91 93 95 93 93
Sewer 36 36 35 35 35 35 35 35 35 35
Total 831 835 840 824 826 832 853 869 903 921
Source:City of Round Rock Finance Department
173
CITY OF ROUND ROCK,TEXAS
OPERATING INDICATORS BY FUNCTION
LAST TEN FISCAL YEARS
2008 2009 2010 2011
Function:
Police-
Arrests 3,749 3,908 4,328 4,521
Accident reports 1,997 1,646 1,877 2,747
Index crimes reported 2,449 2,960 3,154 3,154
Crimes per thousand residents 30.10 30.30 31.30 31.30
Officers per thousand of population 1.52 1.52 1.48 1.48
Fire-
Incident volume 7,690 8,000 8,500 8,141
Priority calls answered 5,656 5,800 6,000 5,916
Non-emergency calls answered 2,034 2,200 2,500 2,225
Priority calls-response less than 6 minutes 64% 65% 65% 65%
Public Works-
Street-
Street resurfacing(lane miles) 135 137 137 45
Potholes repaired annually 4,000 4,000 4,000 4,000
Signals maintained 59 59 59 68
Shop-
Work orders 5,618 6,330 6,930 4,609
Number of departments served 19 19 19 19
Culture and Recreation-
Library-
Number of items circulated 762,926 780,000 810,000 854,000
Number of card holders 49,829 51,000 53,000 59,000
Number of library visits 311,000 310,000 320,000 292,000
Parks&Recreation-
Total park acres maintained 1,610 1,757 1,780 1,935
Number of athletic fields maintained 38 43 45 46
Number of trees planted 818 877 350 345
*Number of recreation enrollees 402,548 401,000 401,000 420,000
Number of recreation participants - - - -
Water-
New connections 572 254 356 335
Line maintenance work orders 4,400 4,226 4,044 3,185
Average monthly consumption 552,610,000 589,159,550 466,096,342 655,615,475
Sewer-
Average monthly treatment 296,208,875 301,433,205 327,351,600 475,482,100
Line feet reviewed for infiltration&inflow 161,291 156,934 114,176 317,789
Source: City of Round Rock Finance Department
*Note:Parks and Recreation started recording all participants in all programs in Fiscal Year 2015
174
M
9L9`90Z 81t`68I t9t`L81 8ZI`69t E8L`LL£ t8L`19£
tLt`iE9`9Zt 19I`L9£`91t 890`II9498£ 000`0006E 000`000`601 OOt`L96`L9t
899`Z90`i L9 80E`Z80`9£9 89 I,I 92`909 001`9E6`l6t 09l`t9l`6t9 I t0`182`099
9t£`£ Zi 9`E LI£`E t£L`9 009`9 6LZ`E
999 081 ZOt 09£ Ztt EiE
L9E`8Lt`i LEE`886 t8 I'm - - -
- - tOL`06t 99t`L8t 000`OZt
801 961 Oil 991 E91 899
6t 6t 6t 6t 6t 6t
OLZ`Z 9t0`Z 9t0`Z 9t0`Z 9E0`Z 9£0`2
0£6`68£ 99Z`16E 929`88£ L9I`60E t8E`EZ£ 89L`t6Z
91t`6L 8 i 8`LL ZZ8`66 Z61`tL OZ9`I8 9££`99
L9L`881`1 Zi£`080`1 t60`ZL6 16Z`9L6 9EI`06 61Z`£06
61 61 6I 61 61 61
OZ9`t 19L`t 66E`t 8L I`t Ltt`t 9£E`9
68 E8 t8 E8 6L 9L
00£ OOt 009`I 000`1 000`1 000`t
09 09 Ot 08 08 09
%89 %19 %99 %E9 %09 %09
6ZZ`8 I I9`9 8ti`L tI E`9 IZO`9 9L8`t
8t9`Z 9EL`E 08L`Z EIL`E 8ZL`E 9Lt`E
LLL`OI 9t£`6 8Z6`6 LZO`6 6tL`8 09£`8
8t'I Et'I E9'i Zt'I 9t'i 6t'i
Ot'9Z 09'ZZ 00'ZZ OL'iZ OI'9Z OULZ
LZ8`Z E8E`Z 6Z£`Z 8EE`Z ZE9`Z LLL`Z
9tL`Z OL£`Z 6tZ`Z ESE`9 9t8`t 98t`t
Z9 i`t 9Lt`t 009`1 ELL'S Z81`9 9I L`9
LIOZ 9IOZ 9106 tiOZ £IOZ ZIOZ
CITY OF ROUND ROCK, TEXAS
CAPITAL ASSET STATISTICS BY FUNCTION
LAST TEN FISCAL YEARS
2008 2009 2010 2011
Function:
Police-
Number of stations 1 1 1 1
Number of units 189 195 199 199
Fire-
Number of stations 7 7 7 7
Number of fire trucks 11 14 15 16
Public Works-
Street-
Lane miles 1,124 1,124 1,137 1,200
Drainage miles 100 100 100 100
Number of street lights 5,075 5,103 5,104 5,119
Number of traffic signals 59 59 59 68
Shop-
Repair facilities 1 1 1 1
Number of bays 19 19 19 19
Culture and Recreation-
Library-
Number of library books 180,397 185,000 185,000 183,000
Number of library facilities 1 1 1 1
Parks&Recreation-
Total park acres 1,610 1,855 2,119 2,274
Number of athletic fields 38 44 46 47
Number of parks 53 60 84 85
Number of tennis courts 23 23 23 23
Number of pools 5 5 5 4
Water-
Number of miles of water lines 487 503 591 584
Pumping stations 14 15 15 15
Tanks 18 19 20 20
Treatment capacity(millions of gallons/day) 48 48 52 52
Sewer-
Number of miles of sewer mains 392 400 417 422
Wastewater lift stations 12 12 12 12
Source: City of Round Rock Finance Department
176
2012 2013 2014 2015 2016 2017
1 1 1 1 1 1
199 201 229 240 259 252
7 7 7 7 7 9
16 16 14 16 15 16
1,200 1,250 1,250 1,250 1,200 1,200
100 150 150 150 150 151
5,312 6,000 6,800 5,400 5,433 5,604
76 79 83 84 83 89
1 1 1 1 1 1
19 19 19 19 13 18
195,000 150,211 154,278 156,277 257,667 213,381
1 1 1 1 1 1
2,035 2,035 2,035 2,035 2,035 2,270
49 49 49 49 49 59
62 62 62 62 62 61
23 23 25 25 25 22
4 4 4 4 4 4
585 587 601 608 615 614
15 1.4 14 15 15 15
20 20 20 22 22 22
52 52 52 52 52 52
422 424 432 424 427 428
12 12 12 12 12 12
177
CITY OF ROUND ROCK,TEXAS
TOP TEN WATER CUSTOMERS
SEPTEMBER 30,2017
%of Total
Water Water
Consumption Consumption
Name of Customer Type of Business in Gallons in Gallons
Fern Bluff Municipal Utility District Municipal Utility District 298,368,600 4.354%
Williamson County Municipal Utility District# 1 Municipal Utility District 203,914,000 2.976
Williamson County Municipal Utility District# 11 Municipal Utility District 194,950,300 2.845
Williamson County Municipal Utility District# 10 Municipal Utility District 166,480,100 2.429
Chandler Creek Municipal Utility District Municipal Utility District 153,397,800 2.238
Vista Oaks Municipal Utility District Municipal Utility District 124,819,100 1.821
Dell Technologies Electronic Equipment 92,367,700 1.348
Round Rock Independent School District Public Schools 69,615,000 1.016
Walsh Ranch Municipal Utility District Municipal Utility District 53,419,900 0.780
Michael Angelo's Food Production 52,187,000 0.762
1,409,519,500 20.569%
Source: City of Round Rock Finance Department
178
CITY OF ROUND ROCK, TEXAS
WATER AND SEWER RETAIL RATES
SEPTEMBER 30,2017
Water rates for retail customers inside the city limits are as follows:
Volume Rate Monthly Service Charge
Non peak billing periods: Meter Size Base Monthly Water
$2.49 per 1,000 gallons of water used by all customers Serving Customer Service Charge
Peak billing periods:
Four block structure for use in excess of predetermined amounts set by meter size-
Block 1: $2.49 per 1,000 gallons of water used by all customers
Block 2: Base rate times 125%
Block 3: Base rate times 150%
Block 4:Base rate times 200%
5/8 inch $ 14.69
3/4 inch 20.46
1 inch 32.30
1 1/2 inch 61.89
2 inch 97.40
3 inch 180.27
4 inch 298.66
6 inch 931.10
8 inch 1,627.45
10 inch 2,555.91
12 inch 3,136.21
Sewer rates for retail customers inside the city limits are as follows:
Volume Rate Monthly Service Charge
$3.39 per 1,000 gallons of water used by all customers * Meter Size Base Monthly Sewer
Serving Customer Service Charge
5/8 inch $ 13.27
3/4 inch 17.31
1 inch 24.82
1 1/2 inch 45.26
2 inch 69.79
3 inch 127.01
4 inch 208.75
6 inch 615.27
8 inch 1,073.67
10 inch 1,684.85
12 inch 2,066.84
* Sewer customers'volume is measured as the rate per 1,000 gallons of the lesser of a three-month winter average or actual
water use.
Note:Rates above represent those that were in effect for FY2017. New rates and rate structure became effective October 1,
2017.
Source:City of Round Rock Finance Department
179
r
180
SINGLE AUDIT
SECTION
- s 3
�s�
�� � ltitlttftt
tt tyt
182
CITY OF ROUND ROCK, TEXAS
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
SEPTEMBER 30,2017
Pass-
Grant or Through to
Federal Grantor/Pass-Through Grantor CFDA Identifying Non-State Expenditures
Program Title Number Number Entities Direct Total
Institute of Museum and Library Services
Passed-Through from Texas State Library and Archives
Commission
Grants to States 45.310 $ - $ 13,873 $ 13,873
Total Institute of Museum and Library Services - 13,873 13,873
U.S.Department of Housing&Urban Development
Community Development Block Grants/Entitlement Grants
Cluster
Community Development Block Grants/Entitlement Grants 14.218 1313MC480514 13,838 17,158 30,996
Community Development Block Grants/Entitlement Grants 14.218 B14MC480514 2,869 114,989 117,858
Community Development Block Grants/Entitlement Grants 14.218 B15MC480514 20,874 146,216 167,090
Community Development Block Grants/Entitlement Grants 14.218 B 16MC480514 97,327 77,695 175,022
Total Community Development Block Grants/Entitlement
Grants Cluster 134,908 356,058 490,966
Total ti.S.Department of Housing&Urban Development 134,908 356,058 490,966
U.S.Department of Justice
Edward Byrne Memorial Justice Assistance Grant Program 16.738 - 8,840 8,840
Equitable Sharing Program 16.922 TX2460500 - 8,973 8,973
Passed-Through from the Federal Bureau of Investigation-San
Antonio VCTF
Equitable Sharing Program 16.922 MOU-June 19,2017 - 132,221 132,221
Total U.S.Department of Justice - 1.50,034 150,034
U.S.Department of Transportation
Federal Transit Formula Grants 20.507 TX-90-Y001-00 - 297,192 297,192
Federal Transit Formula Grants 20.507 TX-2017-035-00 - 25,279 25,279
Passed-Through from Capitol Metropolitan Transportation
Authority
Job Access and Reverse Commute Program 20.516 TX-37-X065-01 - 69,106 69,106
Highway Planning and Construction Cluster
CSJ#0914-05-164/
Quiet Zone Project 20.205 0914-05-165 - 9,878 9,878
RM 620 Right of Way Acquisitions Project 20.205 CSJ 0883-01-056 - 988,519 988,519
Sidewalk GAPS Project 20.205 CSJ 0914-05-186 - 324,062 324,062
Southwest Downtown Infrastructure Improvements Project 20.205 CSJ 0914-05-185 - 235,328 235,328
Passed-Through from the Texas Department of Transportation
Recreational Trails Program 20.219 CSJ#0914-05-161 - 109,667 109,667
Total Highway Planning and Construction Cluster - 1,667,454 1,667,454
Total U.S.Department of Transportation - 2,059,031 2,059,031
U.S.Department of Treasury
Equitable Sharing Program 21.016 TX2460500 - 53,099 53,099
Total U.S.Department of Treasury - 53,099 53,099
Total Expenditures of Federal Awards $ 134,908 $ 2,632,09.5 $ 2,767,003
183
CITY OF ROUND ROCK,TEXAS
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
SEPTEMBER 30,2017
1. BASIS OF PRESENTATION
The Schedule of Expenditures of Federal Awards presents the activity of all applicable federal awards
of the City of Round Rock, Texas. The City's reporting entity is defined in the notes of the basic
financial statements. Federal financial assistance received directly from federal agencies as well as
federal financial assistance passed through other governmental agencies is included on the Schedule of
Expenditures of Federal Awards. The information on this schedule is presented in accordance with the
requirements of Uniform Guidance, Audits of States, Local Governments and Non-Profit
Organizations.Therefore,some amounts presented in this schedule may differ from amounts presented
in, or used in the preparation of the basic financial statements.
2. BASIS OF ACCOUNTING
The Schedule of Expenditures of Federal Awards is prepared on the modified accrual basis of
accounting. Expenditures are recognized when the related fund liability is incurred.Federal grants are
considered to be earned to the extent of expenditures made under the provision of the grant and are
received on a reimbursement basis.
3. INDIRECT COST RATE
The City of Round Rock has not elected to use the 10-percent de minimis indirect cost rate allowed
under the Uniform Guidance.
184
INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED
ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
WITH GOVERNMENT UDITING STANDARDS
To the Honorable Mayor and
Members of City Council
City of Round Rock, Texas
We have audited, in accordance with the 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, the financial statements of the governmental
activities, the business-type activities, each major fund, and the aggregate remaining fund information of
City of Round Rock, Texas(the "City"), as of and for the year ended September 30, 2017, and the related
notes to the financial statements, which collectively comprise the City's basic financial statements, and
have issued our report thereon dated February 2,2018.
Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City's internal control
over financial reporting (internal control) to determine the audit procedures that are appropriate in the
circumstances for the purpose of expressing our opinions on the financial statements, but not for the
purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do
not express an opinion on the effectiveness of the City's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a
combination of deficiencies, in internal control, such that there is a reasonable possibility that a material
misstatement of the entity's financial statements will not be prevented, or detected and corrected on a
timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control
that is less severe than a material weakness,yet important enough to merit attention by those charged with
governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this
section and was not designed to identify all deficiencies in internal control that might be material
weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any
deficiencies in internal control that we consider to be material weaknesses. However, material
weaknesses may exist that have not been identified.
A rnember of
185
Nexia
InT.ernationial
To the Honorable Mayor and
Members of City Council
City of Round Rock, Texas
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements, noncompliance with which could have a direct and material effect on the
determination of financial statement amounts. However, providing an opinion on compliance with those
provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The
results of our tests disclosed no instances of noncompliance or other matters that are required to be
reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the entity's internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the entity's internal control and compliance.
Accordingly,this communication is not suitable for any other purpose.
Austin, Texas
February 2,2018
186
Auslln 01ti e
wh
ifleypenn"
609 Shoal Creek Boulevard Suite
-301
Ausbn,Texas 78701.
`12..4'?8. 1.65 Mian
whillt Vic nr'1.cJn7
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE FOR EACH MAJOR
PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE
REQUIRED BY THE UNIFORM GUIDANCE
To the Honorable Mayor and
Members of City Council
City of Round Rock, Texas
Report on Compliance for Each Major Federal Program
We have audited City of Round Rock, Texas' (the "City") compliance with the types of requirements
described in the OMB Compliance Supplement that could have a direct and material effect on each of the
City's major federal programs for the year ended September 30, 2017. The City's major federal programs
are identified in the summary of auditor's results section of the accompanying schedule of findings and
questioned costs.
Management's Responsibility
Management is responsible for compliance with federal statues, regulations, and the terms and conditions
of its federal awards applicable to its federal programs.
Auditor's Responsibility
Our responsibility is to express an opinion on compliance for each of the City's major federal programs
based on our audit of the types of compliance requirements referred to above. We conducted our audit of
compliance in accordance with auditing standards generally accepted in the United States of America; the
standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal
Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for
Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan
and perform the audit to obtain reasonable assurance about whether noncompliance with the types of
compliance requirements referred to above that could have a direct and material effect on a major federal
program occurred. An audit includes examining, on a test basis, evidence about the City's compliance
with those requirements and performing such other procedures as we considered necessary in the
circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major
federal program. However, our audit does not provide a legal determination of the City's compliance.
A irien'ber of 1 g7
Nexi;
International 1ti,I'1 Fort Worth HGUs'-ern
? Dallas Dallas t1
To the Honorable Mayor and
Members of City Council
City of Round Rock, Texas
Opinion on Each Major Federal Program
In our opinion, the City complied, in all material respects, with the types of compliance requirements
referred to above that could have a direct and material effect on each of its major federal programs for the
year ended September 30, 2017.
Report on Internal Control Over Compliance
Management of the City is responsible for establishing and maintaining effective internal control over
compliance with the types of compliance requirements referred to above. In planning and performing our
audit of compliance, we considered the City's internal control over compliance with the types of
requirements that could have a direct and material effect on each major federal program to determine the
auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on
compliance for each major federal program and to test and report on internal control over compliance in
accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the
effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the
effectiveness of the City's internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a
federal program on a timely basis. A material weakness in internal control over compliance is a
deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a
reasonable possibility that material noncompliance with a type of compliance requirement of a federal
program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in
internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over
compliance with a type of compliance requirement of a federal program that is less severe than a material
weakness in internal control over compliance, yet important enough to merit attention by those charged
with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over
compliance that might be material weaknesses or significant deficiencies. We did not identify any
deficiencies in internal control over compliance that we consider to be material weaknesses. However,
material weaknesses may exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our
testing of internal control over compliance and the results of that testing based on the requirements of the
Uniform Guidance. Accordingly,this report is not suitable for any other purpose.
WA;-he-
Austin, Texas
February 2, 2018
188
CITY OF ROUND ROCK, TEXAS
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For the Year Ended September 30,2017
I. Summary of Auditor's Results
Financial Statements
Type of auditor's report issued Unmodified
Internal control over financial reporting:
Material weakness(es) identified? No
Significant deficiency(ies) identified that are not considered to
be material weaknesses? None reported
Noncompliance material to the financial statements noted? No
Federal Awards
Internal controls over major programs:
Material weakness(es) identified? No
Significant deficiency (ies) identified that are not considered to
be material weaknesses? None reported
Type of auditor's report issued on compliance for major
programs: Unmodified
Any audit findings disclosed that are required to be reported in
accordance with 2 CFR 200.516(a)? No
Identification of Major Programs:
Name of Federal Program or Cluster CFDA Number
Highway Planning and Construction Cluster:
Quiet Zone Project 20.205
RM 620 Right of Way Acquisitions Project 20.205
Sidewalk GAPs Project 20.205
Southwest Downtown Infrastructure Improvements Project 20.205
Recreational Trails Program 20.219
Dollar threshold used to distinguish Between Type A
and Type B federal programs: $750,000
Auditee qualified as low-risk auditee? Yes
189
CITY OF ROUND ROCK,TEXAS
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For the Year Ended September 30,2017
II. Financial Statement Findings
None Noted
III. Federal Award Findings and Questioned Costs
None Noted
190