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Res 22-26 Accepting the Comprehensive Annual Financial Report presented by Weaver and Tidwell, L.L.P., for the fiscal year ended September 30, 2021TOWN OF WESTLAKE RESOLUTION NO.22-26 A RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF WESTLAKE, TEXAS, ACCEPTING THE COMPREHENSIVE ANNUAL FINANCIAL REPORT PRESENTED BY WEAVER AND TIDWELL, L.L.P., FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2021. WHEREAS, Section 103.001 of the Local Government Code requires that a municipality shall have its records and accounts audited annually and shall have an annual financial statement prepared based on the audit; and WHEREAS, Section 103.002 of the Local Government Code requires that a municipality shall employ at its own expense a certified public accountant who is licensed in this state or a public accountant who holds a permit to practice from the Texas State Board of Public Accountancy to conduct the audit and to prepare the annual financial statements; and WHEREAS, the Town Council finds that the passage of this Resolution is in the best interest of the citizens of Westlake. NOW, THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF THE TOWN OF WESTLAKE: SECTION 1: That, all matters stated in the Recitals hereinabove are found to be true and correct and are incorporated herein by reference as if copied in their entirety. SECTION 2: That the Town Council does hereby accept the Comprehensive Annual Financial Report from Weaver and Tidwell, L.L.P., for the fiscal year ended September 30, 2021, attached as Exhibit "A". SECTION 3: If any portion of this Resolution shall, for any reason, be declared invalid by any court of competent jurisdiction, such invalidity shall not affect the remaining provisions hereof and the Council hereby determines that it would have adopted this Resolution without the invalid provision. SECTION 4: That this resolution shall become effective from and after its date of passage. Resolution 22-26 Page 1 of'2 PASSED AND APPROVED ON THIS 23rd DAY OF MAY 2022. ATTEST: Mary J. own Sean Kilbride, Mayor FW� Mv DeGan, Town Manager Resolution 22-26 Page 2 of 2 TOWN OF WESTLAKE ANNUAL COMPREHENSIVE FINANCIAL REPORT FISCAL YEAR ENDED SEPTEMBER 30, 2021 T H E T o w H o IF WESTLAKE DISTINCTIVE BY DESIGN T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN Town of Westlake, Texas Annual Comprehensive Financial Report Fiscal Year Ended September 30, 2021 Prepared by: Town of Westlake Finance Department 1500 Solana Blvd, Suite 7200 Westlake, Texas 76262 T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN Town of Westlake Annual Comprehensive Financial Report For the Fiscal Year Ended September 30, 2021 Table of Contents Page Exhibit Introductory Section Letter of Transmittal iii GFOA Certificate of Achievement xi Organization Chart xii Town Officials xiii Financial Section Independent Auditor's Report 3 Management's Discussion and Analysis 9 Basic Financial Statements Government -Wide Financial Statements Statement of Net Position 23 A-1 Statement of Activities 24 A-2 Fund Financial Statements Governmental Funds Financial Statements Balance Sheet 26 A-3 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position 28 A-4 Statement of Revenues, Expenditures, and Changes in Fund Balances 30 A-5 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities 32 A-6 Proprietary Funds Financial Statements Statement of Net Position 33 A-7 Statement of Revenues, Expenses, and Changes in Net Position 34 A-8 Statement of Cash Flows 35 A-9 Fiduciary Funds Financial Statements Statement of Fiduciary Net Position 36 A-10 Statement of Changes in Fiduciary Net Position 37 A-11 Discretely Presented Component Units Financial Statements Combining Statement of Net Position 39 A-12 Combining Statement of Activities 40 A-13 Notes to the Basic Financial Statements 43 Required Supplementary Information Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - General Fund 91 B-1 Schedule of Revenues, Expentitures and Changes in Fund Balance - Budget and Actual - Westlake Academy 92 B-2 Notes to Budgetary Comparison Schedules 93 Schedule of Net Pension Liability and Related Ratios - TMRS Pension Plan 94 B-3 Schedule of Pension Contributions - TMRS Pension Plan 95 B-4 Schedule of Academy's Proportionate Share of Net Pension Liability - TRS Pension Plan 96 B-5 Schedule of Pension Contributions - TRS Pension Plan 97 B-6 Schedule of Changes in the Total OPEB Liability and Related Ratios - TMRS OPEB Plan 98 B-7 Schedule of OPEB Contributions - TM IRS OPEB Plan 99 B-8 Schedule of Academy's Proportionate Share of Net OPEB Liability - TRS Care Plan 100 B-9 Schedule of OPEB Contributions - TRS Care Plan 101 B-10 Town of Westlake Annual Comprehensive Financial Report For the Fiscal Year Ended September 30, 2021 Table of Contents - Continued Page Exhibit Combining and Individual Fund Statements and Schedules Major Governmental Funds Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual - Debt Service Fund 104 C-1 Nonmajor Governmental Funds Combining Balance Sheet 106 C-2 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance 107 C-3 Nonmajor Special Revenue Funds Budgetary Comparison Schedules Visitors Association Fund 108 C-4 Lone Star Public Facilities Corporation Fund 109 C-5 Economic Development Fund 110 C-6 4B Economic Development Corporation Fund ill C-7 Statistical Section Net Position By Component 115 S-1 Changes in Net Position 116 S-2 Fund Balances, Governmental Funds 118 S-3 Changes in Fund Balances, Governmental Funds 119 S-4 Assessed Value and Estimated Actual Value of Taxable Property 121 S-5 Principal Property Tax Payers 122 S-6 Property Tax Levies and Collections 123 S-7 Direct and Overlapping Property Tax Rates 124 S-8 Taxable Sales by Industry Type 125 S-9 Ratios of General Bonded Debt Outstanding 126 S-10 Ratios of Outstanding Debt by Type 127 S-11 Direct and Overlapping Governmental Activities Debt 128 S-12 Demographic and Economic Statistics 129 S-13 Principal Employers 130 S-14 Full -Time Equivalent Town Government Employees by Function/Program 131 S-15 Operating Indicators by Function/Program 132 S-16 Capital Asset Statistics by Function/Program 133 S-17 4 T H E T D W N O F WESTLAKE May 17, 2022 Honorable Mayor, Council Members, and Citizens of the Town of Westlake, The Town of Westlake (the "Town") Fiscal and Budgetary Policies require that the Town's Finance Department prepare a complete set of financial statements presented in conformity with generally accepted accounting principles (GAAP) and audited in accordance with generally accepted auditing standards by a firm of licensed certified public accountants. Accordingly, the Annual Comprehensive Financial Report for the Town of Westlake, Texas for the fiscal year ended September 30, 2021, is hereby issued. This report consists of management's representations concerning the finances of the Town. Consequently, management assumes full responsibility for the completeness and reliability of all the information presented in this report. To provide a reasonable basis for making representations, the Town established a comprehensive internal control framework that was designed both to protect the Town's assets from loss, theft or misuse and to compile sufficient reliable information for the preparation of the Town's financial statements in conformity with GAAP. Because the cost of internal controls should not outweigh their benefits, the Town's comprehensive framework of internal controls has been designed to provide reasonable, rather than an absolute, assurance that the financial statements will be free from material misstatements. As management, we assert that this financial report is complete and reliable in all material respects to the best of our knowledge and belief. The Town's financial statements have been audited by Weaver and Tidwell, L.L.P. The goal of the independent audit was to provide reasonable assurance that the financial statements of the Town for the fiscal year ended September 30, 2021, were free of material misstatements. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall financial statement presentation. The independent auditor concluded, based upon the audit, that there was a reasonable basis for rendering an unmodified opinion that the Town's financial statements for the fiscal year ended September 30, 2021, were fairly presented in conformity with GAAP. The independent auditors' report is presented as the first component of the financial section of this report. The Town of Westlake's MD&A can be found immediately following the independent auditor's report. The Statistical Section includes financial and demographic information relevant to readers of the Town's financial statements and is generally presented on a multi -year basis. Profile of the Town Westlake is certainly distinctive by design. As a result of this intentional design, our community is an oasis of natural beauty that maintains open spaces in balance with one -of -a -kind developments, trails, and quality of life amenities amidst an ever-expanding urban landscape. Nestled in the Dallas -Fort Worth (DFW) Metroplex, Westlake is designated as both a Platinum Level Scenic City and a Tree City USA. Extraordinary residential developments and architecturally vibrant corporate campuses find harmony among our meandering roads and trails, lined with native oaks and stone walls. Westlake is a leader in education, known for our innovative partnerships between the Town -operated Charter school and our corporate neighbors. We strive to maintain strong aesthetic standards and preserve the natural beauty in our community where hospitality finds its home. Westlake is family -friendly, welcoming, fully involved and invested in our rich heritage, with a vibrant present and sustainable future. Ideally located minutes from downtown Fort Worth, its Alliance Airport and the Dallas/Fort Worth International Airport, the Town of Westlake is home to several prestigious residential communities, Fortune 500 companies, and corporate headquarters, all of which possess a unique character and charm. There is a common ideal shared by our corporate and individual residents of support for the existing character and charm of the Westlake community as well as a commitment to excellence in new development. The Town geographically lies in both northeast Tarrant County and southern Denton County and may be conveniently accessed by several major thoroughfares, including SH 114, SH 170 and US 377. Westlake occupies approximately seven (7) square miles and serves a population of approximately 1,840. In 2021, the average size of new home construction was 8,949 square feet, with an average estimated construction cost of $1.8 million. Westlake, incorporated in 1956, is considered a Type A general -law municipality. The Town operates under the Council -Manager form of government. The Council is comprised of a mayor and five (5) council members and is responsible for, among other things, passing ordinances, adopting the budget, appointing committees, and hiring the Town Manager. The Town Manager is responsible for carrying out the policies and ordinances of the Council, for overseeing the day-to-day operations of the Town and appointing and supervising heads of various departments. The Mayor and Town Council members serve two (2) year terms. All elected officials are elected at -large for a two-year staggered term each May. The financial reporting entity (the government) includes all funds of the primary government (i.e. the Town of Westlake), as well as all its component units. Component units are legally separate entities for which the primary government is financially accountable. The following entities are considered blended component units: Lone Star Public Facilities Corporation is a Texas nonprofit corporation that acts on behalf of the Town to further the public purposes under the Public Facilities Corporation Act, as it's duly constituted authority and instrumentality. The board of directors, appointed by the Town's governing body, is comprised of seven members, of whom five must be members of the Town's governing body. O 413 Economic Development Corporation is a Texas nonprofit industrial corporation under the Development Corporation Act of 1979 formed to promote economic development within the Town and the State of Texas to eliminate unemployment and underemployment, and to promote and encourage employment and the public welfare of, for, and on behalf of the Town by developing, implementing, financing, and providing one or more projects defined and permitted under Section 4B of the Act. The board of directors is composed of seven (7) persons appointed by the members of the Town Council. Four of the members of the board of directors are members of the Town Council. Westlake Academy (Academy) is an open -enrollment charter school, as provided by Subchapter D, Chapter 12, of the Texas Education Code. The Town of Westlake ("Charter Holder") applied for and became the first municipality in Texas to ever receive this special charter designation. The Academy had 856 students in FY 20-21 and serves Kindergarten thru 12th grade. The Academy graduated their first class in FY 09-10. The Board consists of six (6) trustees, appointed by the Town's governing body. Currently, all members of the Academy Board are members of the Town's governing body. The Academy's year-end is August 31. Discretely presented component units are legally separate entities and not part of the primary government's operations. These component units are as follows: Texas Student Housing Corporation -Denton Project, Texas Student Housing Corporation -College Station Project, and Texas Student Housing Authority. Services Provided Westlake's value proposition is found in the excellent municipal and academic services that are provided to our residents — all at an exceptional price! Our community has high expectations for service delivery — both in accessibility, responsiveness, financial stewardship, amenities, distinctive developments, open spaces and education. Major services provided under the general government and enterprise functions are: Fire and emergency medical services, police, water and sewer utility services, park and recreational facilities, street improvements, education and administrative services. The Town utilizes a combination of direct service delivery along with out -sourced services in its service delivery mix. The decision as to which service to deliver directly versus out -sourcing is based on analysis of cost-effectiveness, citizen responsiveness, and customer service quality. Economic Conditions and Outlook Coronavirus (COVID-19) The coronavirus pandemic continued to cast a shadow over the Town of Westlake's economic outlook and our country's economic outlook as a whole in 2021. The United States' economic downturn remains unprecedented as local, state and federal leaders continue to work through the impacts caused by the necessary actions designed to suppress COVID-19 transmission. The Town has remained steadfast in their established conservative approach during this time and seeks cost -saving adjustments wherever prudent. Local Challenges Involving Residential Growth The information presented in the financial statements is perhaps best understood when it is considered from the broader perspective of the environment within which the Town operates. The Town staff is aware that the Town of Westlake does not create wealth but instead is entrusted with public dollars collected on behalf of our citizens. We are stewards who are fully vested in the success of the Town of Westlake and Westlake Academy. We exist as a municipal corporation for one reason and one reason only: to prioritize and deliver the best services possible with the resources provided to achieve an exceptional quality of life. This is a challenge the Staff takes very seriously, one that we pursue with vigor every day. Over the previous fiscal year, the Town's continued work and focus on important initiatives and projects allows us to balance our "distinctive development, trails, and quality of life amenities amidst an ever-expanding urban landscape." The current and potential development within our community provides both an exciting and challenging time in Westlake! Adhering to the Town's Vision remains the key to Westlake's success in managing the significant growth. While growth has steadily continued, it continues to present very clear opportunities for our community if we wish to maintain the elements of Westlake that make it so distinctive. These community attributes include our beautiful neighborhoods with high quality residences, strong aesthetic standards, an exemplary Town owned IB World K-12 charter school, open space preservation, future public art projects, streetscaping, emphasis on proactive planning, and maintaining our view corridors. The impending change that surrounds Westlake involves not only our current internal development but also the growth opportunities planned and now underway for the State Highway corridors (SH 114 and SH 170) in northeast Tarrant County and into southern Denton County. Our neighboring communities have also experienced significant growth and are nearing a fully developed condition that will only add pressure from developers as they look to a relatively undeveloped Westlake. • Westlake's Permanent Population Growth: This is the portion of our population considered to be our permanent residents. From the 1990 population of 185 to the 2021 population of 1,840, our Town saw an increase of 176 additional residents in the past year. We will monitor and plan for the anticipated increase in these numbers considering our Comprehensive Plan's forecast of approximately 7.21% annual population growth between now and 2040. This would bring us to around 7,000 residents. • Traffic Demands Due to Growth in Westlake and Surrounding Areas: The four (4) municipalities surrounding Westlake (Keller, Southlake, Trophy Club, and Roanoke) are projected to have a combined population of 215,000 people by 2040. The growth in these communities will generate additional traffic that commutes through our Town. And with the projected level of residents (7,000) and existing zoning entitlements (if executed), we would expect an estimated 300,000 vehicle trips per day. Local impacts associated with this level of growth affect our street infrastructure, water and sewer system capital investment requirements, as well as demand for daily municipal services. Policies, and the provided estimates above, established in our Comprehensive Plan will be essential for addressing this issue via the Town's thoroughfare plan as it pertains to development in the community. • Housing Start Increases and Maintaining Westlake's High -Quality Residential Housing: We continue to see strong single-family residential construction demand, with the majority of the growth in the Granada (now nearing completion), Quail Hollow, Vaquero, Entrada, and The Knolls of Solana. The Entrada mixed -use development continues to progress, albeit slowly, with both residential and commercial projects under construction. Entrada's infrastructure is financed with a Town approved Public Improvement District (PID), the bonds for which are paid back by assessments on development within Entrada. When the infrastructure is complete, it will add (over time) a wide variety of 322 residential units to Westlake - including single-family homes, villas, condominiums, and townhomes. a Our residential construction activity remains steady with an increase in building permits for housing, even through the effects of Covid-19. Housing starts in Westlake, due to our homes' high value, add taxable value to our taxing base; however, this also impacts the demand for municipal services, especially the Town's K-12 public charter school, Westlake Academy. As the area economy continues to push through the economic downturn of a pandemic, and Westlake and our surrounding communities continue to experience commercial development, this will further attract individuals who work for and own these businesses. As our housing stock expands in response to these forces, we will need to manage our developments to ensure we maintain our distinctive community as an 'oasis of natural beauty' and achieve high -end housing options as identified in the Housing element of our Comprehensive Plan. Below is a quick glance at the status of Westlake's residential developments as of March 2022: Development Constructed Lots/Units Vacant Entrada 27 units 295 units Granada 67 lots 17 lots Knolls at Solana 4 lots 52 lots Quail Hollow 17 lots 76 lots Vaquero 270lots 27lots Westlake Ranch/Aspen Estates 0 lots 36 lots Others 213 32 lots TOTAL: 598 units 535 units *Projected home completions in 2022: 30 units Local Challenges Involving Commercial Growth • Commercial Development, Economic Development, and Daytime Population Growth: Because Westlake is the home to major corporate office campuses, its Monday -Friday daytime population continues to grow and is conservatively estimated to grow to an approximate 20,075 individuals, post- COVID. These office complexes are comprised of notable corporate clients that include Deloitte LLP, Fidelity Investments, and Charles Schwab among other Fortune 500 companies. o Commercial Development in Entrada: The mixed -use development of Entrada, located at FM1938/Davis Boulevard and SH114, slowly continues to create growth in our commercial tax base. During the past budget year additional commercial buildings have been approved by the Town for the development. Several medical services and personal care offices opened for business, joining CVS Pharmacy, Primrose Private Preschool, and Starbucks. Significant progress was made this year on the water front restaurants, parking garage, and chapel on the northeast side of the development as well. Other approved residential and commercial uses include various retail, a reception hall, and hotels. Entrada's anticipated activity in 2022 includes: vii o Construction of a 90,080 square foot Residential Repository which includes customized luxury storage units, flex offices, and a rooftop restaurant. Construction timeline: 2 years o Construction of a five -story condominium building with up to 100 residential units. Construction timeline: 2 years o Opening of three new restaurants totaling 15,000 square feet. o Opening of a new parking garage totaling 424 parking spaces. Economic Development: The Town has pursued the ideas advanced in the Economic Development element of the Comprehensive Plan. That is, where appropriate, to pursue businesses that ultimately expand the Town's tax base with high quality office buildings, and at the same time, compliments our financial services industry hub which has already been created through our corporate residents of Fidelity, Deloitte, and Charles Schwab. Further, we pursue the types of businesses interested in high quality office campus development and creating well -paying employees' positions. The completion of Charles Schwab and its merger with TD Ameritrade's complex in Southlake firmly establishes us as a leading financial services corridor within the DFW Metroplex. Additionally, the Town has recently entered into a new economic development agreement with Deloitte, LLP for expansion of their international learning and innovation center in 2022. Balanced Growth to Impact Cost of Municipal Services: Likewise, the ability to fund municipal services utilizing a cost-effective revenue format requires balanced growth that provides for commercial development and a diversified tax base, while maintaining the community's open space and pastoral atmosphere. At the same time, we must continue to ensure the policy direction of the Town is focused on growth paying for the infrastructure for which it creates the demand. Staff will continue to monitor our corporate stakeholders and attempt to identify avenues to strengthen these relationships and assist in attracting new corporations to Westlake. The expansion of commercial development will continue to grow Westlake's daytime population. Local Challenges — Other There are other local challenges involving both financial and physical site planning, strategic forecasting, residential feedback through our survey instruments and the Town's public charter school, Westlake Academy. As we look to regional or state issues and opportunities, we will monitor these issues among others: • Water Usage and Demand — As water demand continues to be a high priority for our entire region, the Town has worked diligently over the last few years to secure the necessary infrastructure and resources for our future needs with the recent addition of a new 30 inch water line and a N-1 sewer line. Efforts continue this year to begin and complete the addition of a fifth water pump at our Westlake Pump Station. All of these recent improvements are estimated to meet the projected development needs at final build -out of the Town, along with our neighboring communities in northeast Tarrant County. • Westlake's Residential Growth Impact on the Academy: Planning for Academy growth in the face of residential development remains a consistent focus and challenge for us. Wherever possible, the Town enters into an economic development agreement with residential developers to provide funding for Westlake Academy facilities and lessen the impact of their residential development on the school's enrollment. Not only did we receive additional funding this year from a new development, but Town staff is nearing completion of the school's program needs and enrollment trends analysis. We hope to complete the Westlake Academy Facility Master Plan this year and obtain the best balance of student population and facility needs for its near future. • Pursuit of Infrastructure and Services Reinvestment While Combating Certain Cost Increases: With our continued growth comes the need to allocate capital spending as we continue to reinvest in our infrastructure, including water and sewer utilities and trail and roadway improvements. This year our current budget included $3.4 million for these capital improvement costs. As our community and those surrounding us continue to develop, Staff will strengthen our partnerships and/or opportunities to help in the improvement of mobility within the community without compromising the design standards and expectations of our residents. East/West traffic continues to be an area of concern along with our surrounding highway capacity for transient vehicles. Town staff continues the work with TxDOT, and our counties, as the construction of the new SH 114 service road between FM 1938 and Dove Road in Southlake, and the SH 170 main lanes from SH 114 west to I- 35, have now begun. These improvements are expected to be complete within the next 12-24 months. Users of this transmittal letter, as well as others interested in the programs and services offered by the Town of Westlake, are encouraged to read the Town's Fiscal Year 2021-2022 Budget. The budget details the Town's long-term goals and financial policies and describes program accomplishments and initiatives. Other Information The Government Finance Officers Association of the United States of America and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the Town of Westlake for its annual comprehensive financial report for the fiscal year ended September 30, 2020. To be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized annual comprehensive 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 annual comprehensive financial report will meet the Certificate of Achievement Program's requirements and we plan to submit it to GFOA to determine its eligibility for another certificate. In addition, we also received our thirteenth GFOA Distinguished Budget Presentation Award for the fiscal year beginning October 1, 2020 for our municipal budget. To qualify for the Distinguished Budget Presentation Award, the Town budget document had to be judged proficient as a policy document, a financial plan, an operations guide, and a communications device. Westlake Academy has also received recognition from the Association of School Business Officials International as a recipient of the International Award for Budget Excellence for the past ten years. ix Acknowledgements The preparation of this report could not be accomplished without the dedicated services of the entire Finance Department staff. Appreciation is expressed to all Town employees, especially those employees who were instrumental in the successful completion of this report. Town Staff would sincerely like to thank the Mayor and Council for their conservative leadership and steadfast support through their transparent governance of the Town's financial operations in a responsible and progressive manner. Respectfully Submitted, I P j 2091, ffi� Amanda DeGan Town Manager/Superintendent gill Ginger R. Awtry '<- aze6� Director of Finance x Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reportllla Presented to Town of Westlake Texas For its Annual Comprehensive Financial Report For the Fiscal Year Ended September 30. 2020 , Executive DirectorrCEO xi XI I ELECTED COUNCIL MEMBERS Laura Wheat Mayor (wheat@westlake-tx.org A Chandrika Dasgupta �� Council Member cdasgupta@westlake-tx.org Ana White Council Member ci awhite@westlake-tx.org ' Carol Langdon Mayor Pro-Tem clangdon@westlake-tx.org Alesa Belvedere Council Member abelvedere@westlake-tx.org Rajiv Trivedi Council Member rtrivedi@westlake-tx.org BOARDS & COMMISSIONS Planning & Zoning Commission Westlake Academy Foundation 4B Economic Development Board Westlake Public Arts Society Westlake Historical Preservation Society Texas Student Housing Authority xui T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN X1v Financial Section lw T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN 2 weaver Assurance • Tax • Advisory Independent Auditor's Report To the Honorable Mayor and Members of Town Council Town of Westlake, Texas Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business -type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the Town of Westlake (the Town) as of and for the year ended September 30, 2021, and the related notes to the financial statements, which collectively comprise the Town'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 to fraud or error. Auditor's Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We did not audit the financial statements of Texas Student Housing Authority, Texas Student Housing Corporation - College Station Project, and Texas Student Housing Corporation - Denton Project, the discretely presented component units. Those financial statements were audited by other auditors whose reports have been furnished to us, and our opinions, insofar as they relate to the amounts included for Texas Student Housing Authority, Texas Student Housing Corporation - College Station Project, and Texas Student Housing Corporation - Denton Project, are based solely on the reports of the other auditors. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The financial statements of Texas Student Housing Authority, Texas Student Housing Corporation - College Station Project, and Texas Student Housing Corporation - Denton Project were not audited in accordance with Government Auditing Standards. 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. Weaver and Tidwell, L.L.P. 2300 North Field Street, Suite 1000 1 Dallas, Texas 75201 3 Main: 972.490.1970 CPAs AND ADVISORS I WEAVER.COM The Honorable Mayor and Members of Town Council Town of Westlake, Texas We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, based on our audit and the report of other auditors, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business -type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the Town, as of September 30, 2021, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. Emphasis of Matters Reaardina Goina Concern The accompanying financial statements have been prepared assuming the discretely presented component units will continue as going concerns. As discussed in Note 17 to the financial statements, the discretely presented component units are in default on their bonds due to failure to meet certain bond covenants. This gives bond holders the right to accelerate and demand payment on the bonds in full. This condition raises substantial doubt about the discretely presented component units' ability to continue as going concerns. Management's plans regarding these matters are also described in Note 17. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified with respect to this matter. Implementation of Government Accounting Standards Board (GASB) Statement No. 84 As discussed in Note 19 to the basic financial statements, during the year ended September 30, 2021, the Town implemented GASB Statement No. 84, Fiduciary Activities. Beginning net position in the fiduciary funds and governmental activities and beginning fund balance in the governmental funds have been restated as a result of the implementation of this statement. Our opinions are not modified with respect to this matter. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management's discussion and analysis on pages 9 through 19 and budgetary comparison information and pension and OPEB schedules on pages 90 through 100 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 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. 4 The Honorable Mayor and Members of Town Council Town of Westlake, Texas Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Town's basic financial statements. The introductory section, combining and individual fund financial statements and schedules, and statistical section, are presented for purposes of additional analysis and are not a required part of the financial statements. The combining and individual fund statements and schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual fund statements and schedules are fairly stated in all material respects in relation to the basic financial statements as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we 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 May 17, 2022 on our consideration of the Town's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is 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 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 Town's internal control over financial reporting and compliance. WEAVER AND TIDWELL, L.L.P. Dallas, Texas May 17, 2022 5 T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN M. Management's Discussion and Analysis T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN Management's Discussion and Analysis Management of the Town of Westlake offers the readers of the Town's financial statements this narrative overview and analysis of the financial activities and financial position of the Town for the fiscal year ended September 30, 2021. Financial reporting is limited in its ability to provide the "big picture" but rather focuses on financial position and changes in financial position. In other words, are revenues and/or expenditures higher or lower than the previous year? Has the net position (containing both short- term and long-term assets and liabilities) or fund balances (the current "spendable" assets less current liabilities) of the government been maintained? Readers are encouraged to consider the information presented here in conjunction with the additional information furnished in the letter of transmittal and the statistical section, as well as information in the annual operating budget, along with other community information found on the Town's website at www.westlake-tx.org. It should be noted that the Independent Auditor's Report describes the auditors' association with the various sections of this report and that all the additional information from the website and other Town sources are unaudited. FINANCIAL HIGHLIGHTS The assets and deferred outflows of resources of the Town exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by $64,264,956 (Net position). This number must be viewed within the context that the vast majority of the Town's net position of $52,795,677 (82.2%) is its investment in capital assets and that most capital assets in a government entity do not directly generate revenue nor can they be sold to generate liquid capital. The net position restricted for specific purposes totaled $2,734,375 (4.3%). The remaining amount, $8,734,904 (13.5%), represents unrestricted net position. • As of the close of the current fiscal year, the Town of Westlake's governmental funds reported combined ending fund balances of $28,951,609, which is an increase of $5,430,794 in comparison with the prior year. Within this total, $11,097,599 is non -spendable, restricted, committed or assigned by management or council. • At the end of the current fiscal year, fund balance for the general fund was $18,212,917 an increase of $1,622,407 in comparison with the prior year. Of this total fund balance, $17,854,010 is unassigned. This represents 189.5% of the total general fund expenditures and is equivalent to 682 operating days. • The Town's capital assets (net of accumulated depreciation) decreased by $1,538,031. This is due in large part to depreciation expense exceeding current year capital asset additions. • The Town's long-term debt increased by $1,175,352 in total, primarily due to the issuance of bonds during the fiscal year. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the Town's basic financial statements. The Town's basic financial statements are comprised of the following three components: 1) Government -wide financial statements, 2) Fund financial statements, and 3) Notes to the financial statements. This report also contains 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 Town's finances, in a manner similar to a private -sector business. The government -wide financial statements are prepared utilizing the economic resources measurement focus and the accrual basis of accounting. The statement of net position presents information on all the Town's assets and deferred outflows of resources and liabilities and deferred inflows of resources with the difference between the two reported as net position. Over time, increases or decreases in the Town's net position serves as a useful indicator of whether the financial position of the Town is improving or weakening. The statement of activities presents information showing how the government's net position changed during the most recent fiscal year. All the revenues and expenses 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. Both government -wide financial statements distinguish functions of the Town that are principally supported by sales taxes, property taxes, and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business -type activities). The governmental activities of the Town include general government, public safety, culture and recreation, economic development, public works, visitor services and education. The business -type activities of the Town include water/sewer and cemetery. The government -wide financial statements include not only the Town (known as the primary government), but also discretely presented component units including all the Texas Student Housing entities. Financial information for these component units is reported separately from the financial information presented for the primary government itself. In addition, the Town has the following blended component units: Lone Star Public Facilities Corporation, 4B Economic Development Corporation, and Westlake Academy, an open enrollment charter school owned and operated by the Town of Westlake. See pages 43 - 44 of the "Financial Section" for detail on these entities. Fund Financial Statements A fund is a grouping of related accounts used to maintain control over resources that have been segregated for specific activities or objectives. The Town, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance -related legal requirements. Below are the three types of funds. Governmental funds - Governmental funds are used to account for essentially the same functions reported as government activities in the government -wide financial statements. However, unlike the government -wide financial statements, governmental fund financial statements focus on 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 financial requirements. Because the focus of governmental funds is narrower than that of the government -wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government -wide financial statements. By doing so, the reader may better understand the long-term impact of the government's near -term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. IN The Town maintains eleven 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, Westlake Academy, Debt Service, and Capital Projects, all of which are presented as major funds. Data from the other funds (Visitors Association, Economic Development, Lone Star Public Facilities Corporation, Public Arts, 4B Economic Development Corporation, Solana PID Capital Projects, and Westlake Academy Expansion Capital Projects funds) are combined into a single, aggregate presentation. Individual fund data for each of these non -major governmental funds is provided in the form of combining statements elsewhere in this report. The Town adopts an annual appropriated budget for all funds, except the Capital Projects, Solana PID Capital Projects, Public Arts, and Westlake Academy Expansion funds which are project -length based budgets. A budgetary comparison statement has been provided for all appropriate funds to demonstrate compliance with this budget. The basic governmental fund financial statements can be found on pages 26 - 32 of this report. Proprietary funds - There are two types of proprietary funds, Enterprise Funds and Internal Service Funds. Enterprise Funds are the only proprietary funds currently maintained by the Town. Enterprise funds are used to report the same functions presented as business -type activities in the government -wide financial statements. The Town uses enterprise funds to account for its water and sewer activities and its cemetery activities. All activities associated with providing such services are accounted for in these funds, including administration, operation, maintenance, debt service, capital improvements, billing and collection. The Town's intent is that the costs of providing the services to the general public on a continuing basis is financed through user based charges in a manner similar to a private enterprise. The Town has no Internal Service Funds (fund to report activities that provide supplies and services for the Town's other programs and activities, i.e. self-insurance and fleet management). The basic proprietary fund financial statements can be found on pages 33 - 35 on this report. Fiduciary funds - Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not reflected in the government -wide financial statements because the resources of those funds are not available to support the Town's own programs. The accounting used for fiduciary funds is similar to the accounting used for proprietary funds. The Town of Westlake maintains one fiduciary fund, the PID Custodial Fund. Notes to the financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government -wide and fund financial statements. The notes to the financial statements can be found on pages 43 - 88 of this report. Other information. In addition to the basic financial statements and accompanying notes, this report also presents schedules that further support the information in the financial statements. The schedules are presented immediately following the notes to the financial statements and can be found on pages 91 - 111. Government -Wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of the government's financial position. In the case of the Town, assets and deferred outflows exceeded liabilities and deferred inflows by $64,264,956 at the close of the most recent fiscal year. The Town's combined net position changed from a year ago, increasing $3,177,527, exclusive of the $56,123 cumulative effect of the change in accounting principle. Our analysis below focuses on the net position (Table 1) and changes in net position (Table 2) of the Town's governmental and business -type activities. The largest portion of the Town's net position, $52,795,677 (82.2%), reflects its investment in capital assets (e.g. land, buildings, equipment, improvements, construction in progress, and infrastructure), less any debt used to acquire capital assets still outstanding. The Town uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the Town's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources since the capital assets themselves cannot be used to liquidate these liabilities. An additional portion of the Town's net position, $2,734,375 (4.3%), represents resources that are subject to external restrictions on how they may be used. The remaining balance of $8,734,904 (13.5%) represents unrestricted net position which is available for the Town's ongoing expenses. Assets Current and other assets Capital assets Total Assets Deferred outflows of resources Liabilities Noncurrent liabilities Other liabilities Total Liabilities Deferred inflows of resources Net Position (deficit) Net investments in capital assets Restricted U nrestricted Total Net Position (deficit) Table 1 Condensed Statement of Net Position At September 30, 2021 and 2020 Governmental Activities Business -type Activities Total 2021 2020 2021 2020 2021 2020 $ 31,017,151 $ 24,790,376 $ 9,135,320 $ 7,072,350 $ 40,152,471 $ 31,862,726 75,676,563 76,747,384 9,792,880 10,260,090 85,469,443 87,007,474 106,693,714 101,537,760 18,928,200 17,332,440 125,621,914 118,870,200 40,637,633 38,422,095 7,717,104 7,833,053 2,190,804 1,392,491 11,998,996 11,150,698 42,828,437 39,814,586 19,716,100 18,983,751 48,354,737 46,255,148 62,544,537 58,798,337 2,461,543 1,757,053 29,209 32,362 2,490,752 1,789,415 48,565,384 46,633,638 4,230,293 4,672,681 52,795,677 51,306,319 2,684,375 3,653,143 50,000 50,000 2,734,375 3,703,143 13,764,861 12,350,020 (5,029,957) (6,328,176) 8,734,904 6,021,844 $ 65,014,620 $ 62,636,801 $ (749,664) $ (1,605,495) $ 64,264,956 $ 61,031,306 12 Table 2 Changes in Net Position For the Years Ended September 30, 2021 and 2020 Governmental Activities Business -type Activities Total Revenues Program revenues Charges for services $ 3,305,279 $ 2,645,897 $ 6,242,299 $ 6,478,333 $ 9,547,578 $ 9,124,230 Operating grant and contributions 10,240,349 9,725,263 - - 10,240,349 9,725,263 Capital grants and contributions 1,537,500 280,000 1,537,500 280,000 General revenues Taxes Sales taxes 6,372,366 7,378,900 6,372,366 7,378,900 Property taxes 2,708,091 2,411,279 2,708,091 2,411,279 Hotel occupancy taxes 222,937 369,145 222,937 369,145 Mixed beverage taxes 23,269 41,949 23,269 41,949 Franchise taxes 735,263 972,520 - - 735,263 972,520 Interest on investments 38,381 260,003 11,439 62,177 49,820 322,180 Miscellaneous 91,890 72,688 - 91,890 72,688 Total revenues 25,275,325 24,157,644 6,253,738 6,540,510 $ 31,529,063 $ 30,698,154 Expenses General governmental 6,101,168 6,555,048 - - 6,101,168 6,555,048 Public safety 4,011,699 3,991,114 4,011,699 3,991,114 Culture and recreation 182,503 282,512 182,503 282,512 Economic development - 150,037 - 150,037 Public works 1,297,821 1,326,090 1,297,821 1,326,090 Visitor services 451,392 802,244 451,392 802,244 Education 9,972,935 9,979,674 9,972,935 9,979,674 Interest on long-term debt 1,141,125 1,103,925 - - 1,141,125 1,103,925 Water and sewer - - 5,184,455 6,407,650 5,184,455 6,407,650 Cemetery - 8,438 21,734 8,438 21,734 Total expenses 23,158,643 24,190,644 5,192,893 6,429,384 28,351,536 30,620,028 Increase (decrease) in net position before transfers 2,116,682 (33,000) 1,060,845 111,126 3,177,527 78,126 Transfers 205,014 77,158 (205,014) (77,158) - - Change in net position 2,321,696 44,158 855,831 33,968 3,177,527 78,126 Net position (deficit), beginning 62,636,801 62,592,643 (1,605,495) (1,639,463) 61,031,306 60,953,180 Cumulative effect of the change in accounting principle 56,123 - 56,123 - Net position (deficit), ending $ 65,014,620 $ 62,636,801 $ (749,664) $ (1,605,495) $ 64,264,956 $ 61,031,306 13 Governmental activities: Governmental activities increased the Town's net position by $2,321,696 (3.8%). Unrestricted net position, the part of net position that can be used to finance day-to-day operations without constraints established by debt covenants, enabling legislation, other legal requirements, and/or Council or management's decision, increased by $1,414,841 primarily due to an increase in charges for services from building permits and fees and capital grants and contributions. Total revenues for governmental activities increased by $1,117,681 when compared to the prior year. General revenue decreased by $1,314,287, while program revenues increased by $2,431,968. Program revenues • Charges for services increased $659,382 which was primarily due to an increase in permit and review fees for development which have recovered after COVID-19 with an increase in economic activities within the Town. • Capital Grants and Contributions increased by $1,257,500 with the major portion being attributed to a $1.25 million donation received in the fiscal year for the expansion of Westlake Academy. General revenues • Sales tax decreased by $1,006,534 as a result of decreased taxable sales due, in part, to the COVID-19 pandemic. Property taxes increased by $296,812 due to increases in both the tax rate and taxable valuation. Expenses • Total expenses for governmental activities decreased by $1,032,001 or approximately 4.3%. • Decreases in expenses occurred in culture and recreation ($100,009), economic development ($150,037), and visitor services ($350,852). These declines occurred primarily as a result of decreased operations from COVID-19. The remaining reduction in expenses was primarily due to decreased activities in general government function of $453,880. These decreases include a reduction in allocations to Westlake Academy, reductions in allocations of depreciation expense, and overall decreases in operating costs from the prior year. Business -type Activities: The net position of the business -type activities was a deficit balance of $749,664 as of September 30 2021, which was an increase of $855,831. The business -type activities increased primarily due to operating expenses decreasing by over $1.2 million, mainly attributed to reduced spending for an intergovernmental non -capital infrastructure project with the City of Fort Worth. 14 Financial Analysis of the Town's Funds As noted earlier, the Town uses fund accounting to ensure and demonstrate compliance with finance - related legal requirements. Governmental funds. The focus of the Town's governmental funds is to provide information on near -term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the Town's financing requirements. In particular, unassigned fund balance may serve as a useful measure of a town's net resources available for spending at the end of the fiscal year. As of the end of the current fiscal year, the Town's governmental funds reported combined ending fund balances of $28,951,609; an increase of $5,430,794 in comparison with the prior year. Approximately 61.7% of this total ($17,854,010) constitutes unassigned fund balance, which is available for spending at the government's discretion. The remainder of fund balance is non -spendable, restricted, committed or assigned to indicate that it is not available for new spending because of constraints. The following tables present a summary of general, special revenue, capital project, and debt service fund revenues and expenditures for the fiscal year ended September 30, 2021, and the amount and percentage of increases and decreases in relation to the prior year. Table 3 Summary of Governmental Funds Revenues Increase Percent 2020-21 Percent (Decrease) Increase Revenues Amount of Total From 2019-20 (Decrease) Taxes Sales taxes $ 6,372,366 25.3% $ (1,006,534) (13.6)% Property taxes 2,711,849 10.8% 299,985 12.4 % Mixed beverage taxes 23,269 0.1% (18,680) (44.5)% Hotel occupancy taxes 222,937 0.9% (146,208) (39.6)% Franchise taxes 735,263 2.9% (237,257) (24.4)% Subtotal - Taxes 10,065,684 39.9% (1,108,694) (9.9)% State program 8,457,552 33.5% 446,491 5.6 % Federal program 121,678 0.5% (16,232) (11.8)% Interest income 38,381 0.2% (221,622) (85.2)% Building permits and fees 2,612,098 10.4% 615,264 30.8 % Fines and penalties 582,854 2.3% 90,419 18.4 % Intergovernmental 25,000 0.1% 250 0.0 % Contributions 1,800,000 7.1 % 1,507,140 514.6 % Miscellaneous 1,512,867 6.1% (300,127) (16.6)% Total Revenues $ 25,216,114 100.0% $ 1,012,889 4.2 % 15 Table 4 Summary of Governmental Funds Expenditures Expenditures General government $ Public safety Culture and recreation Economic development Public works Visitor services Education Capital outlay Debt services 2020-21 Amount 5,052,010 3,546,694 182,253 601,562 448,414 9,557,739 1,129,642 3,065,817 Increase Percent (Decrease) Of Total From 2019-20 21.4% $ 15.0% 0.8% 0.0% 2.6% 1.9% 40.5% 4.8% 12.9% (116,766) 34,238 (82,164) (150,037) (20,839) (333,469) (287,946) (551,276) 124,326 Percent Increase (Decrease) (2.3)% 1.0 % (31.1)% (100.0)% (3.3)% (42.6)% (2.9)% (32.8)% 4.2 % Total Expenditures $ 23,584,131 100.0% $ (1,383,933) (5.5)% Below are summaries and explanations of the changes in fund balances from fiscal year 2020 to fiscal year 2021 of the Governmental Funds that are contained in the above totals. General Fund - At the end of the current fiscal year, fund balance for the general fund (which for financial reporting purposes also includes the major maintenance fund and vehicle maintenance/replacement fund) was $18,212,917, an increase of $1,622,407 in comparison with the prior year. Of this total, $17,854,010 is unassigned. This represents 189.5% of the total general fund expenditures including transfers out to other funds related to operations of $357,169. This is equivalent to 682 operating days. Overall revenues in the General Fund increased $96,100 from FY20 to FY21; the primary reason for the increase was building permits and fees which increased $615,264 from the previous year due to increased development since the beginning of the COVID pandemic. The Town also had increases in property tax revenues of $291,495 and contributions of $287,140. These increases were offset by a reduction in sales tax revenues of $754,851 experienced in FY21 as a result of decreased taxable sales within the Town because of COVID-19. • Expenditures remained largely consistent from FY20 to FY21, with only minor variances in functional categories. Westlake Academy - Fund balance increased by $236,968 primarily due to a decrease in operating costs including reductions related to cleaning supplies, furniture enhancements additional air filtering systems, and contracted services necessary for the mitigation of the effects of COVID-19 in FY20. Capital Projects Fund - Fund balance increased by $4,596,395 primarily due to issuance of $3,215,000 in certificates of obligation to fund various capital projects including street, drainage, and park improvements. This fund balance also increased as a result of contributions being received including the contribution of $1.25 million for the expansion of Westlake Academy. Debt Service Fund - The debt service fund remained consistent only slightly decreasing by $46,525 with an ending fund balance of $103,993. The debt service fund had transfers in from the general and non - major funds totaling $1,950,261 which offset the net of debt service payments and property tax revenues ($2,069,718). Non Major Funds - The non major fund balance decreased by $1,034,574 the result of transfers to the Debt Service Fund and Capital Projects Fund totaling $2,593,092. Un. Proprietary Funds. - The Town's proprietary fund statements provide the same type of information found in the government -wide financial statements with greater detail. Total net position of the Proprietary Funds increased by $855,831. This increase is the combined effect of an increase in the utility fund of $838,739 primarily due to reduced operating costs; and a $17,092 increase in the cemetery fund. General Fund Budgetary Highlights The General Fund budget for fiscal year 2021 was amended in total to increase the net change in fund balance from ($1,811,672) to $725,300, a total increase of $2,536,972. The amended budget for revenues was increased by $1,428,119 (14.9%) based on an anticipated increases in various revenue categories based on economic recovery projections. The amended budget for expenditures was decreased by $467,325 (4.5%). This reduction was primarily due to decreases in public safety expenditures related to a reduction in payroll from vacant positions. The General Fund actual revenues were more than the amended budget by $205,465 primarily due to sales taxes and building permits and fee revenues exceeding projections. Actual expenditures were less than the amended budget by $586,509 due mostly to less than anticipated service expenditures. Capital Assets and Debt Administration Capital Assets. The Town's investment in capital assets for its governmental and business -type activities as of September 30, 2021, totaled $85,469,443 (net of accumulated depreciation). The investment in capital assets includes land, buildings, improvements, machinery and equipment, infrastructure, and construction in progress. The net decrease in the Town's investment in capital assets for the current fiscal year was $1,538,031 or 1.8% mostly due to depreciation exceeding current year capital asset additions. Table 5 Town's Capital Assets (Net of Accumulated Depreciation) Governmental Activities Business -type Activities Total 2021 2020 2021 2020 2021 2020 Land $ 12,446,059 $ 12,446,059 $ - $ - $ 12,446,059 $ 12,446,059 Capital improvements 27,375,576 27,033,940 8,286,570 8,646,033 35,662,146 35,679,973 Building 33,488,757 34,370,215 - - 33,488,757 34,370,215 Machinery and equipment 1,500,479 1,442,037 1,177,280 1,285,027 2,677,759 2,727,064 Construction in progress 865,692 1,455,133 329,030 329,030 1,194,722 1,784,163 Total capital assets $ 75,676,563 $ 76,747,384 $ 9,792,880 $ 10,260,090 $ 85,469,443 $ 87,007,474 Additional information on the Town's capital assets can be found in Note 4 on pages 56 - 58 of this report. Long-term liabilities - At the end of the current fiscal year, the Town had total long-term debt outstanding of $41,573,789. Of this amount, $34,652,000 represents bonded indebtedness with premium outstanding of $1,565,509, $152,921 of capital leases, $431,719 of compensated absences, $91,696 in loans and $4,679,944 of contractual obligations. During the fiscal year 2020-2021, the Town's total debt payable increased by $1,175,352. This is the net result of the paying down of debt during the year, the issuance of refunding general obligation bonds and the related savings, and the issuance or certificates of obligation to fund new projects within the Town. Standard & Poor's Ratings Services, a division of McGraw-Hill, Inc. reconfirmed the Town's rating of AAA/stable. Additional information about the rating agency or the significance of the rating provided may be obtained from Standard & Poor's web site. Additional information on the Town's long-term debt can be found in Note 5 on pages 59 - 65. 17 Table 6 Outstanding Debt at Year -End Governmental Activities Business -type Activities Total 2021 2020 2021 2020 2021 2020 General obligation bonds $ 12,690,000 $ 12,660,000 $ - $ - $ 12,690,000 $ 12,660,000 Certificates of obligation 18,502,550 16,996,900 2,777,450 2,891,100 21,280,000 19,888,000 Tax notes 682,000 901,000 - - 682,000 901,000 Contractual obligations - - 4,679,944 4,679,944 4,679,944 4,679,944 Capital leases 152,921 398,012 - - 152,921 398,012 Premium on bonds 1,540,316 1,279,473 25,193 26,365 1,565,509 1,305,838 Notes payable 91,696 128,373 - - 91,696 128,373 Compensated absences 358,959 368,239 72,760 69,031 431,719 437,270 Total long-term debt $ 34,018,442 $ 32,731,997 $ 7,555,347 $ 7,666,440 $ 41,573,789 $ 40,398,437 In addition to the liabilities in Table 6, the Town reports liabilities for the Academy's proportionate share of the TRS net pension and OPEB liabilities and the Town's net pension and total OPEB liabilities associated with TMRS. The Town's net pension liability relative to its participation in Texas Municipal Retirement System (TMRS) decreased from $1,440,488 as of September 30, 2020 to $1,370,359 as of September 30, 2021. The Town's net other post -employment benefits (OPEB) liability relative to its participation in Texas Municipal Retirement System (TMRS) increased from $82,590 as of September 30, 2020 to $108,591 as of September 30, 2021. The Academy's proportionate share of the Teacher Retirement System (TRS) net pension liability increased from $1,502,914 as of August 31, 2020 to $2,987,427 as of August 31, 2021. The Academy's proportionate share of the Teacher Retirement System (TRS) net OPEB liability decreased from $2,830,719 as of August 31, 2020 to $2,314,571 as of August 31, 2021. Economic Factors and Next Year's Budgets In the FY 2021-2022 adopted budget, the fund balance of the General Fund, which includes the Town's General Fund, General Maintenance & Replacement Fund and General Vehicle Maintenance & Replacement Fund for audit purposes, is anticipated to decrease by $3.2M. Adopted revenues and transfers in are budgeted to be less than the 2021 actuals by $903K primarily due to the reallocation of M&O property tax to I&S property tax and a decrease in contributions. Anticipated expenditures and transfers out are budgeted to be $4.1 M more than the prior year. Transfers in were significantly increased ($2.4M) this year after pausing during the past two years of COVID-19 and the uncertainty of its effects. These transfers were allocated to the following funds: General Maintenance & Replacement, General Vehicle Maintenance & Replacement, Capital Projects, and the Visitors Association Fund. Additionally, other expenditures were increased ($1.7M) due to anticipated post - pandemic effects of higher costs for needed supplies, contract & consulting services, repairs, and maintenance. While COVID-19 continues to present budgetary challenges for businesses and local governments with the uncertainty of its post -pandemic effects, the budget is intended to be adaptable given the unfamiliar long-term fiscal impact of the pandemic and with other service delivery needs that may arise within our community. In This budget adheres to Council directions to stabilize our ad valorem rate, closely monitor expenditures, and restart transfers of revenue to the funds noted above for responsible planning. These directives help ensure we plan for the Town's financial stability and are better prepared to meet the service delivery expectations of our community. Our approach to both revenue estimating and expenditure requests continue to proceed in a steadfast fiscally conservative manner. Contacting the Town's Finance Department This financial report is designed to provide our citizens, customers, and investors and creditors with a general overview of the Town's finances and to demonstrate the Town's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Ginger R. Awtry, Town of Westlake Director of Finance, at 817-490-5719 or email at gawtry@westlake- tx.org. Me T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN 20 Basic Financial Statements 21 T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN 22 Town of Westlake Statement of Net Position September 30, 2021 Exhibit A-1 Primary Government Discretely Governmental Business -type Presented Activities Activities Total Component Units ASSETS Cash and cash equivalents $ 27,962,784 $ 7,497,247 $ 35,460,031 $ 3,594,018 Receivables (net of allowance) 2,628,919 1,166,770 3,795,689 452,025 Inventories - 87,546 87,546 - Other assets 195,046 24 195,070 - Restricted cash and cash equivalents 230,402 383,733 614,135 1,304,601 Capital assets: Land and construction in progress 13,311,751 329,030 13,640,781 5,099,597 Buildings and improvements 78,838,734 14,899,416 93,738,150 52,590,312 Wastewater treatment rights - 635,199 635,199 - Machinery and equipment 6,535,979 3,732,823 10,268,802 - Furniture and fixtures - - - 4,726,323 Less accumulated depreciation (23,009,901) (9,803,588) (32,813,489) (37,243,058) Total capital assets 75,676,563 9,792,880 85,469,443 25,173,174 Total assets 106,693,714 18,928,200 125,621,914 30,523,818 DEFERRED OUTFLOWS OF RESOURCES Deferred outflows of resources - TRS OPEB 416,945 - 416,945 - Deferred outflows of resources - TM IRS OPEB 29,416 3,613 33,029 Deferred outflows of resources - TRS pension 2,100,145 - 2,100,145 Deferred outflows of resources - TM IRS pension 519,668 63,832 583,500 Deferred loss on refunding 544,712 - 544,712 Total deferred outflows of resources 3,610,886 67,445 3,678,331 - LIABILITIES Accounts payable 1,843,026 439,401 2,282,427 1,720,956 Customer deposit payable - 268,315 268,315 - Unearned revenue 216,762 279,514 496,276 368,747 Accrued interest payable 131,016 11,011,766 11,142,782 39,260,713 Noncurrent liabilities: Due within one year Long-term debt 1,997,849 4,794,694 6,792,543 48,750,031 Compensated absences 35,896 7,276 43,172 - Due in more than one year Long-term debt 31,661,634 2,687,893 34,349,527 Compensated absences 323,063 65,484 388,547 TRS net OPEB liability 2,314,571 - 2,314,571 TMRS total OPEB liability 96,712 11,879 108,591 TRS net pension liability 2,987,427 - 2,987,427 TM IRS net pension liability 1,220,481 149,878 1,370,359 - Totalliabilities 42,828,437 19,716,100 62,544,537 90,100,447 DEFERRED INFLOWS OF RESOURCES Deferredinflows- TRSOPEB 1,694,859 - 1,694,859 - Deferred inflows - TMRSOPEB 3,636 446 4,082 Deferredinflows- TRSpension 396,946 - 396,946 Deferredinflows- TMRSpension 234,172 28,763 262,935 Deferred gain on refunding 131,930 - 131,930 Total deferred inflows of resources 2,461,543 29,209 2,490,752 NET POSITION (DEFICIT) Net investment in capital assets 48,565,384 4,230,293 52,795,677 (23,576,857) Restricted for: Tourism 98,081 - 98,081 Construction 2,331,905 2,331,905 Court security and technology 239,576 239,576 Future projects 14,813 - 14,813 Improvements - 50,000 50,000 Unrestricted 13,764,861 (5,029,957) 8,734,904 (35,999,772) Total net position (deficit) $ 65,014,620 $ (749,664) $ 64,264,956 $ (59,576,629) The Notes to the Financial Statements are an integral part of this statement. 23 Town of Westlake Statement of Activities For the Year Ended September 30, 2021 ram Revenues Charges for Operating Grants Capital Grants Functions/Programs Expenses Services and Contributions and Contributions PRIMARY GOVERNMENT Governmental activities: General government $ 6,101,168 $ 218,922 $ - $ Public safety 4,011,699 724,198 137,500 Cultural and recreation 182,503 - 150,000 - Public works 1,297,821 2,251,832 - 1,300,000 Economic development - - - Visitor services 451,392 - - - Education 9,972,935 110,327 9,952,849 237,500 Interest on long-term debt 1,141,125 - - - Total governmental activities 23,158,643 3,305,279 10,240,349 1,537,500 Business -type activities: Water and sewer 5,184,455 6,217,154 - - Cemetery 8,438 25,145 - Total business -type activities 5,192,893 6,242,299 - - Total primary government $ 28,351,536 $ 9,547,578 $ 10,240,349 $ 1,537,500 Discretely Presented Component Units $ 11,196,283 $ 6,188,961 $ - $ - GENERAL REVENUES AND TRANSFERS Taxes: Sales taxes Property taxes Hotel occupancy taxes Mixed beverage taxes Franchise taxes Interest Income Miscellaneous Transfers Total general revenues and transfers Change in net position NET POSI11 ON, beginning of year Cumulative effect of change in accounting principle NET POSITION, end of year The Notes to the Financial Statements are an integral part of this statement. 24 Exhibit A-2 Net (Expense) Revenue and Changes in Net Position Primary Government Discretely Governmental Business - Type Presented Activities Activities Total Component Units $ (5,882,246) $ $ (5,882,246) $ (3,150,001) (3,150,001) (32,503) (32,503) 2,254,011 2,254,011 (451,392) (451,392) 327,741 327,741 (1,141,125) (1,141,125) (8,075,515) (8,075,515) 1,032,699 1,032,699 16,707 16,707 1,049,406 1,049,406 $ (8,075,515) $ 1,049,406 $ (7,026,109) $ $ $ $ $ (5,007,322) 6,372,366 6,372,366 2,708,091 2,708,091 222,937 222,937 23,269 23,269 735,263 - 735,263 - 38,381 11,439 49,820 2,715 91,890 - 91,890 - 10,203,636 2,715 2,321,696 855,831 56,12,5- 56,123 - $ 65,014,620 $ (749,664) $ 64,264,956 $ (59,576,629) 25 Town of Westlake Balance Sheet Governmental Funds September 30, 2021 Debt Westlake Service General Academy Fund ASSETS Cash and cash equivalents $ 17,693,936 $ 1,481,822 $ 103,993 Receivables : Property taxes 4,451 - 1,303 Accounts receivable 1,441,947 813,603 - Due from other funds 278,846 - - Prepaid items 38,889 155,760 - Restricted cash and cash equivalents - - - TOTAL ASSETS $ 19,458,069 $ 2,451,185 $ 105,296 LIABILITIES, DEFFERED INFLOWS OF RESOURCES AND FUND BALANCE Liabilities: Accounts payable $ 1,025,796 $ 396,807 $ - Unearned revenue 214,905 - - Due to other funds - - - Total liabilities 1,240,701 396,807 - DEFERRED INFLOWS OF RESOURCES Unavailable resources - property taxes 4,451 - 1,303 Total deferred inflows of resources 4,451 - 1,303 FUND BALANCES Nonspendable: Prepaid items 38,889 155,760 - Restricted for: Tourism - - - Capital items - - - Court security and technology 239,576 - - Debt service - - 103,993 Future projects - - - Education - 1,898,618 - Committed for: Street and tree improvements 80,442 - - U nassigned 17,854,010 - - Total fund balances 18,212,917 2,054,378 103,993 TOTAL LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND FUND BALANCES $ 19,458,069 $ 2,451,185 $ 105,296 The Notes to the Financial Statements are an integral part of this statement. 26 Exhibit A-3 Nonmajor Total Capital Governmental Governmental Projects Funds Funds $ 6,253,444 $ 2,429,589 $ 27,962,784 - - 5,754 50,000 317,615 2,623,165 - - 278,846 - 397 195,046 - 230,402 230,402 $ 6,303,444 $ 2,978,003 $ 31,295,997 $ 167,922 $ 252,501 $ 1,843,026 - 1,857 216,762 - 278,846 278,846 167,922 533,204 2,338,634 5,754 5,754 - 397 195,046 - 97,684 97,684 6,135,522 2,331,905 8,467,427 - - 239,576 - - 103,993 - 14,813 14,813 - - 1,898,618 - - 80,442 - - 17,854,010 6,135,522 2,444,799 28,951,609 $ 6,303,444 $ 2,978,003 $ 31,295,997 27 Town of Westlake Exhibit A-4 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position September 30, 2021 Total fund balance -governmental funds balance sheet $ 28,951,609 Amounts reported for governmental activities in the statement of net position are different because: Capital assets used in governmental activities are not current financial resources and therefore are not reported in the governmental funds balance sheet. 75,676,563 Deferred losses on refunding are reported as deferred outlfows of resources and deferred gains on refunding are reported as deferred inflows in the government -wide statement of net position. This amount is the net effect of deferred losses of $544,712 and deferred gains of ($131,930). 412,782 Revenues earned but not available within sixty days of the fiscal year-end are not recognized as revenue in the fund financial statements. 5,754 Deferred outflows of resources related to the Town's TMRS pension liability and OPEB liability increased net position by $519,668 and $29,416, respectively; while the Town's TMRS deferred resource inflows related to the pension liability and OPEB liability decreased net position by $234,172 and $3,636. This amount is the net effect. 311,276 Deferred outflows of resources related to the Academy's TRS pension liability and OPEB liability increased net position by $2,100,145 and $416,945, respectively; while the Academy's TRS deferred resource inflows related to the pension liability and OPEB liability decreased net position by $396,946 and $1,694,859, respectively. This amount is the net effect. 425,285 Interest payable on long-term debt does not require current financial resources, therefore interest payable is not reported as a liability in the governmental funds balance sheet. (131,016) Long-term liabilities, including bonds payable, are not due and payable in the current period, and therefore are not reported in the fund financial statements. (40,637,633) NET POSITION OF GOVERNMENTAL ACTIVITIES - statement of net position 65,014, 620 The Notes to the Financial Statements are an integral part of this statement. 28 T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN 29 Town of Westlake Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds For the Year Ended September 30, 2021 Westlake Debt General Academy Service Fund REVENUES Taxes Sales $ 4,779,274 $ $ - Property 2,017,446 - 694,403 Mixed beverage 23,269 - - Hotel occupancy - - - Franchise 735,263 - - State program revenues - 8,457,552 - Federal program revenues - 121,678 - I nterest income 26,664 2,422 - Building permits and fees 2,612,098 - Fines and penalties 582,854 - I ntergov ernmental 25,000 - Contributions 300,000 - Miscellaneous 91,890 1,420,977 - Total revenues 11,193,758 10,002,629 694,403 EXPENDITURES Current General government 5,052,010 - - Public safety 3,546,694 - Cultural and recreation 182,253 - Public works 601,562 - - Visitor services - - - Education - 9,557,739 - Capital outlay - - - Debt service Principal retirement 36,677 195,108 1,651,350 Interest and other fiscal charges - 12,814 1,039,839 Bond issuance costs - - 72,932 Total expenditures 9,419,196 9,765,661 2,764,121 Excess (deficiency) of revenues Over (Under) Expenditures 1,774,562 236,968 (2,069,718) OTHER FINANCING SOURCES (USES) Transfers in 205,014 - 1,950,261 Transfers out (357,169) - - Refunding bonds issued - - 4,430,000 Payment to refunding bond escrow agent - - (4,694,366) Premium on bonds and certificates issued - - 337,298 Cerificates of obligation issued - - - Net other financing sources (uses) (152,155) - 2,023,193 NET CHANGE IN FUND BALANCES 1,622,407 236,968 (46,525) FUND BALANCES, AT BEGINNING OF YEAR 16,590,510 1,761,287 150,518 Cumulative effect of change in accounting principle - 56,123 - FUND BALANCES AT END OF YEAR $ 18,212,917 $ 2,054,378 $ 103,993 The Notes to the Financial Statements are an integral part of this statement. 30 Exhibit A-5 Capital Projects 4,392 1,300,000 1,304,392 Nonmajor Total Governmental Governmental Funds Funds 1,593,092 $ 6,372,366 - 2,711,849 - 23,269 222,937 222,937 - 735,263 8,457,552 - 121,678 4,903 38,381 - 2,612,098 582,854 - 25,000 200,000 1,800,000 - 1,512,867 2,020,932 25,216,114 5,052,010 3,546,694 182,253 601,562 448,414 448,414 - - 9,557,739 1,115,642 14,000 1,129, 642 - - 1,883,135 - 1,052,653 57,097 130,029 1,172, 739 462,414 23,584,131 131,653 1,558,518 1,631,983 1,000,000 - 3,155,275 - (2,593,092) (2,950,261) 4,430,000 - (4,694,366) 249,742 587,040 3,215,000 3,215,000 4,464,742 (2,593,092) 3,742,688 4,596,395 (1,034,574) 5,374,671 1,539,127 3,479,373 23,520,815 - - 56,123 $ 6,135,522 $ 2,444,799 $ 28,951,609 31 Town of Westlake Exhibit A-6 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities For the Year Ended September 30, 2021 Net change in fund balances - total governmental funds. $ 5,374,671 Amounts reported for governmental activities in the statement of activities are different because: 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. 1,142,375 Depreciation expense on capital assets is reported in the statement of activities but does not require the use of current financial resources. Therefore, depreciation expense is not reported as expenditures in the governmental funds. (2,213,196) The issuance of long-term debt 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. The amortization of bond premiums and deferred gain/loss on refunding of long- term debt is reported in the statement of activities but does not require the use of current financial resources. Therefore, the effect of the amortization of these various items are not reported in the statement of revenues, expenditures, and changes in fund balance. This amount represents the net effect of the following items: Repayments of long-term debt principal $ 1,933,118 Proceeds from issuance of long-term debt (7,645,000) Premiums on issuance of long-term debt (587,040) Amortization of deferred gains and losses on refunding (87,224) Amortization of premium on bonds 127,355 Payment to bond refunding escrow agent 4,694,366 (1,564,425) Current year changes in accrued interest payable does not require the use of current financial resources; and therefore, are not reported as expenditures in governmental funds. 1,426 Implementation of GASB 68 and 75 requires certain expenditures to be de -expended and recorded as deferred outflows of resources. The changes in deferred outflows from pension and OPEB activity for TMRS decreased net position by $94,294 and increase net position by $6,888, respectively. The change in net pension liability increased net position by $62,429. The change in OPEB liability decreased net position by $23,157. The change in deferred inflows of resources from pension and OPEB activity for TMRS increased net position by $24,914 and increased net position by $753, respectively. This amount is the net effect. (22,467) Implementation of GASB 68 and 75 requires certain expenditures to be de -expended and recorded as deferred outflows of resources. The changes in deferred outflows from pension and OPEB activity for TRS increased net position by $1,144,899 and $19,483, respectively. The change in net pension liability decreased net position by $1,484,513. The change in OPEB liability increased net position by $516,148. The changes in deferred inflows of resources from pension and OPEB activity for TRS decreased net position by $127,979 and by $470,248, respectively. This amount is the net effect. (402,210) Current year changes in the long-term liability for compensated absences do not require the use of current financial resources; and therefore, are not reported as expenditures in governmental funds. 9,280 Certain revenues in the government -wide statement of activities that do not provide current financial resources are not reported as revenue in the governmental funds. (3,758) CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIES - statement of activities $ 2,321,696 The Notes to the Financial Statements are an integral part of this statement. 32 Town of Westlake Statement of Net Position Proprietary Funds September 30, 2021 Utility ASSETS Current assets Cash and cash equivalents $ 7,311,488 $ Accounts receivable 1,162,570 1 nv entories - Prepaid expenses 24 Restricted cash and investments 333,733 Total current assets 8,807,815 Noncurrent assets Capital assets Construction in progress 329,030 Buildings and improvements 14,899,416 Wastewater treatment rights 635,199 Machinery and equipment 3,732,823 Less: accumulated depreciation (9,803,588) Total capital assets 9,792,880 Total noncurrent assets 9,792,880 TOTAL ASSETS 18,600,695 DEFERRED OUTFLOWS OF RESOURCES Deferred outflows - TM IRS OPEB 3,613 Deferred outflows - TM IRS pension 63,832 TOTAL DEFERRED OUTFLOWS OF RESOURCES 67,445 LIABILITIES Current liabilities Accounts payable 437,292 Customer deposits payable 268,315 Accrued interest payable 11,011,766 Unearned revenue 279,514 Compensated absences - current portion 7,276 Current portion of bonds payable 114,750 Contractual obligations 4,679,944 Total current liabilities 16,798,857 Long-term liabilities: _ Bonds payable 2,687,893 Compensated absences 65,484 Total OPEB liability 11,879 Net pension liability 149,878 Total long-term liabilities 2,915,134 TOTAL LIABILITIES 19,713,991 DEFERRED INFLOWS OF RESOURCES Deferred inflows - TMRS OPEB 446 Deferred inflows - TMRS pension 28,763 Total deferred inflows of resources 29,209 NET POSITION (DEFICIT) Net investment in capital assets 4,230,293 Restricted for improvements - U nrestricted (5,305,353) TOTAL NET POSITION (DEFICIT) $ (1,075,060) $ The Notes to the Financial Statements are an integral part of this statement. 33 Exhibit A-7 Cemetery Fund Total 185,759 $ 7,497,247 4,200 1,166,770 87,546 87,546 - 24 327,505 9,135,320 - 329,030 14,899,416 635,199 3,732,823 (9,803,588) 9,792,880 9,792,880 3,613 63,832 67,445 2,109 439,401 - 268,315 11,011,766 279,514 7,276 114,750 4,679,944 2,109 16,800,966 - 1,6tS/,23Y:i 65,484 11,879 149,878 2,109 19,716,100 446 29,209 - 4,230,293 50,000 50,000 275,396 (5,029,957) 325,396 $ (749,664) Town of Westlake Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds For the Year Ended September 30, 2021 OPERATING REVENUES Charges for services Miscellaneous revenue Total operating revenues OPERATING EXPENSES Payroll costs Professional and contract services Depreciation Water purchases Cost of cemetary lots sold Other operating costs Total operating expenses Net operating income NON -OPERATING REVENUES (EXPENSES) I nterest income I nterest expense Total non -operating revenues (expenses) INCOME BEFORE TRANSFERS AND CAPITAL CONTRIBUTIONS Transfer out Change in net position Total net position, beginning of year Total net position, end of year Utility Fund $ 5,985,541 231,613 6,217,154 483,108 48,000 505,123 1,278,398 1,882,696 4,197,325 2,019,829 11,054 (987,130) (976,076) 1,043,753 (205,014) Cemetery Fund $ 25,145 25,145 3,325 1,093 8,438 Exhibit A-8 Total $ 6,010,686 231,613 6,242,299 483,108 51,325 505,123 1,278,398 1,093 1,886,716 4,205,763 385 11,439 - (987,130) 17,092 1,060,845 838,739 17,092 855,831 (1,913,799) 308,304 (1,605,495) $ (1,075,060) $ 325,396 $ (749,664) The Notes to the Financial Statements are an integral part of this statement. 34 Town of Westlake Exhibit A-9 Statement of Cash Flows Proprietary Funds For the Year Ended September 30, 2021 Utility Cemetery Fund Fund Total CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers $ 6,106,195 $ 20,945 $ 6,127,140 Payments to employees (476,655) - (476,655) Payments to suppliers (3,173,944) (7,534) (3,181,478) Net cash provided by operating activities 2,455,596 13,411 2,469,007 CASH FLOW FROM NONCAPITAL FINANCING ACTIVITIES Transfer to other funds (205,014) - (205,014) Net cash used in noncapital financing activities (205,014) (205,014) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Principal paid on debt (113,650) (113,650) Interest paid on debt (199,258) (199,258) Purchase of property and equipment (37,913) (37,913) Net cash used in capital and related financing activities (350,821) - (350,821) CASH FLOWS FROM INVESTING ACTIVITIES Investment earnings 11,054 385 11,439 Net cash provided by investing activities 11,054 385 11,439 Net increase in cash 1,910,815 13,796 1,924,611 Cash and cash equivalents at the beginning of the year 5,734,406 221,963 5,956,369 Cash and cash equivalents at the end of the year $ 7,645,221 $ 235,759 $ 7,880,980 RECONCILIATION OF TOTAL CASH AND CASH EQUIVALENTS Cash and cash equivalents $ 7,311,488 $ 185,759 $ 7,497,247 Restricted cash and cash equivalents 333,733 50,000 383,733 Total cash and cash equivalents $ 7,645,221 $ 235,759 $ 7,880,980 RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES Operating income $ 2,019,829 $ 16,707 $ 2,036,536 Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation 505,123 - 505,123 Pension expense 819 819 OPEB expense 1,905 1,905 Changes in operating assets and liabilities: Receivables (135,228) (4,200) (139,428) Prepaid Iterns (24) - (24) Inventory - 1,093 1,093 Compensated absences 3,729 - 3,729 Accounts payable 42,142 (189) 41,953 Customer deposits payable 26,835 - 26,835 Unearned revenue (9,534) - (9,534) Net cash provided by operating activities $ 2,455,596 $ 13,411 $ 2,469,007 The Notes to the Financial Statements are an integral part of this statement. 35 Exhibit A-10 Town of Westlake Statement of Fiduciary Net Position Custodial Fund September 30, 2021 PID Custodial Fund ASSETS Restricted cash and cash equivalents $ 4,622,482 Total assets $ 4,622,482 LIABILITIES NET POSITION Restricted for Debt service 4,622,482 Total net position $ 4,622,482 36 Exhibit A-11 Town of Westlake Statement of Changes in Fiduciary Net Position Custodial Fund For the Year Ended September 30, 2021 PID Custodial Fund ADDITIONS Special assessment collections $ 2,587,885 Investment income 516 Total additions 2,588,401 DEDUCTIONS Payments to special assessment bond holders 1,953,625 Administrative costs 60,967 Total deductions 2,014,592 Change in net position 573,809 Net position - beginning of year - Cumulative effect of adoption of GASB 84 4,048,673 Net position - beginning of year, as restated 4,048,673 Net position - ending $ 4,622,482 37 T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN M. Town of Westlake Discretely Presented Component Units Combining Statement of Net Position September 30, 2021 Exhibit A-12 Texas Student Texas Student Housing Housing Corporation Texas Student Corporation College Station Housing Denton Project Project Authority Total ASSETS Cash and cash equivalents $ 288,902 $ 711,817 $ 2,593,299 $ 3,594,018 Accounts receivable (net of allowance) 82,262 25,425 344,338 452,025 Restricted assets: Cash and cash equivalents 1,019,587 285,014 - 1,304,601 Capital assets: Land 2,200,000 2,899,597 - 5,099,597 Buildings and improvements 25,705,000 26,885,312 - 52,590,312 Machinery and equipment 1,289,185 3,437,138 - 4,726,323 Less: accumulated depreciation (18,769,482) (18,473,576) - (37,243,058) Total assets 11,815,454 15,770,727 2,937,637 30,523,818 LIABILITIES AND NET POSITION LIABILITIES Accounts payable and accrued expenses 296,586 1,420,639 3,731 1,720,956 Unearned revenue 122,060 246,687 - 368,747 Accrued interest payable 9,988,610 29,272,103 - 39,260,713 Bonds payable 20,545,031 28,205,000 - 48,750,031 Total liabilities 30,952,287 59,144,429 3,731 90,100,447 NET POSITION (DEFICIT) Net investment in capital assets (10,120,328) (13,456,529) - (23,576,857) Unrestricted (9,016,505) (29,917,173) 2,933,906 (35,999,772) Total net position (deficit) $ (19,136,833) $ (43,373,702) $ 2,933,906 $ (59,576,629) The Notes to the Financial Statements are an integral part of this statement. 39 Town of Westlake Discretely Presented Component Units Combining Statement of Activities For the Fiscal Year Ended September 30, 2021 Program Revenues Charges for Operating Grants Capital Grants Functions/Programs Expenses Services and Contributions and Contributions Business -type activities: Texas Student Housing Authority $ 717,383 $ 244,117 $ - $ Texas Student Housing Corporation College Station Project 4,899,268 1,666,804 - Denton Project 5,579,632 4,278,040 - Total business -type activities 11,196,283 6,188,961 - Total component units $ 11,196,283 $ 6,188,961 $ $ GENERAL REVENUES I nterest income Total general revenues Change in net position NET POSITION (DEFICIT), beginning of year NET POSITION (DEFICIT), end of year The Notes to the Financial Statements are an integral part of this statement. 40 Exhibit A-13 Net (Expense) Revenues and Changes in Net Position Texas Student Texas Student Housing Housing Corporation Texas Student Corporation College Station Housing $ $ - $ (473,266) $ (473,266) (3,232,464) (3,232,464) (1,301,592) (1,301,592) (1,301,592) (3,232,464) (473,266) (5,007,322) $ (1,301,592) $ (3,232,464) $ (473,266) $ (5,007,322) 82 56 2,577 2,715 82 56 2,577 2,715 (1,301,510) (3,232,408) (470,689) (5,004,607) (17,835,323) (40,141,294) 3,404,595 (54,572,022) $ (19,136,833) $ (43,373,702) $ 2,933,906 $ (59,576,629) 41 T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN 42 Town of Westlake Notes to the Financial Statements Note 1. Summary of Significant Accounting Policies The Town of Westlake, Texas (the Town) was incorporated under the provisions of the laws of the State of Texas on December 26, 1956. The Town operates under a Council - Manager form of government and provides the following services as authorized by the laws of the State of Texas: public safety; cultural and recreation; and economic development. The accounting and reporting policies of the Town conform to accounting principles generally accepted in the United States of America for local governments. Generally accepted accounting principles (GAAP) for local governments include those principles prescribed by the Governmental Accounting Standards Board (GASB). The following is a summary of the more significant accounting and reporting policies: Financial Reporting Entity The accompanying financial statements present the government and its component units, entities for which the government is considered to be financially accountable. Blended component units, although legally separate entities, are, in substance, part of the Town's operations and are appropriately presented as funds of the primary government. Discretely presented component units, on the other hand, are reported in a separate column in the government -wide financial statements to emphasize it is legally separate from the Town. Based on these criteria, the financial information of the following entities have been blended or discretely presented within the financial statements: Lone Star Public Facilities Corporation, 4B Economic Development Corporation, Westlake Academy, Texas Student Housing Authority, Texas Student Housing Corporation - College Station Project and Texas Student Housing Corporation - Denton Project. The Texas Student Housing Authority, Texas Student Housing Corporation - College Station Project, and Texas Student Housing Corporation - Denton Project (collectively, Texas Student Housing Entities) are Texas nonprofit organizations as a duly constituted authority of the Town pursuant to Section 53.35(b) of the Texas Education Code, as amended (Act). Texas Student Housing Entities' primary purpose is to construct, own, and operate student housing facilities on college campuses in Texas. The board consists of seven directors which are appointed by the Town's governing body and has the ability to remove at will the appointed members; thus, the governing body can impose its will on the organizations. However, the board is not substantively the same as the Town's governing body; therefore, the Texas Student Housing Entities are reported as discretely presented component units (enterprise funds). The Town is not responsible for the long-term debt of the Texas Student Housing Entities. The Texas Student Housing Entities' year-end is August 31. Component Units Discretely Presented Separately issued financial reports are available for all the Texas Student Housing Entities. These reports may be obtained by contacting the following office. Texas Student Housing Authority P.O. Box 93419 Southlake, Texas 76092 43 Town of Westlake Notes to the Financial Statements Blended Lone Star Public Facilities Corporation is a Texas nonprofit corporation that acts on behalf of the Town to further the public purposes under the Public Facilities Corporation Act, as it's duly constituted authority and instrumentality. The board of directors, appointed by the Town's governing body, is comprised of seven members, of whom five must be members of the Town's governing body. Since the board of directors is substantively the same as the Town's governing body, and a financial benefit relationship exists, the entity has been reported as a blended component unit of the Town. 4B Economic Development Corporation is a Texas nonprofit industrial corporation under the Development Corporation Act of 1979 formed to promote economic development within the Town and the State of Texas in order to eliminate unemployment and underemployment, and to promote and encourage employment and the public welfare of, for, and on behalf of the Town by developing, implementing, financing, and providing one or more projects defined and permitted under Section 4B of the Act. The board of directors is composed of seven persons appointed by the members of the Town's governing board. Four of the members of the board of directors are members of the Town's governing board. Since the board of directors is substantively the same as the Town's governing body, and a financial benefit relationship exists, the entity has been reported as a blended component unit of the Town. Westlake Academy (Academy) is an open -enrollment charter school, as provided by Subchapter D, Chapter 12, of the Texas Education Code. The Town of Westlake (Charter Holder) applied for and became the first municipality in Texas to ever receive this special charter designation. The board consists of six trustees and is appointed by the Town's governing body. Currently, all the members of the board of trustees are members of the Town's governing body. Since the board of directors is substantively the same as the Town's governing body, and a financial benefit relationship exists, the entity has been reported as a blended component unit of the Town. The Academy's year-end is August 31. Basis of Presentation Government -Wide and Fund Financial Statements The government -wide financial statements (i.e., the Statement of Net Position and the Statement of Activities) report information on all of the non -fiduciary activities of the Town. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business -type activities, which rely to a significant extent on fees and charges for support. Likewise, the primary government is reported separately from certain legally separate component units for which the primary government is financially accountable. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds and proprietary funds. Major individual Governmental Funds and major individual Enterprise Funds are reported as separate columns in the fund financial statements. 44 Town of Westlake Notes to the Financial Statements Measurement Focus, Basis of Accounting, and Financial Statement Presentation The government -wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the Town considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Sales taxes, franchise taxes, licenses, and interest associated with the current fiscal period are all considered to be susceptible to accrual and have been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable and available only when cash is received by the Town. The Town uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain government functions or activities. A fund is a separate accounting entity with a self -balancing set of accounts. Governmental Funds are those through which most governmental functions of the Town are financed. The acquisition, use, and balances of the Town's expendable financial resources and the related liabilities (except those accounted for in the proprietary fund type) are accounted for through governmental funds. The measurement focus is upon determination of changes in financial position, rather than upon income determination. The Town reports the following major governmental funds: General Fund - to account for all financial resources except those required to be accounted for in another fund. The General Fund balance is available for any purpose, provided it is expended or transferred in accordance with the legally adopted budget of the Town. The General Fund includes the Town's Major Maintenance and Replacement Fund, Vehicle Replacement Fund, and PID (local) Fund. Westlake AcademyF- to account for all local, state and federal revenue and related educational expenditures of the Academy. Debt Service Fund - to account for resources accumulated and payments made for principal and interest on long-term general obligation debt of governmental funds. Capital Projects Fund - to account for proceeds from long-term financing and revenue and expenditures related to authorized construction and other capital asset acquisitions other than those related to the expansion of Westlake Academy facilities. 45 Town of Westlake Notes to the Financial Statements In addition, the Town reports the following nonmajor governmental funds: Visitors Association Fund - to account for municipal hotel occupancy taxes collected and expenditures to promote tourism and the convention and hotel industry. Lone Star Public Facilities Corporation Fund - to account for investment activity relating to the Lone Star Public Facilities Corporation. Economic Development Fund - to account for sales tax and hotel occupancy tax collected to fund activity relating to Economic Development agreements. Public Arts Fund - to account for contributions restricted for public art. 4B Economic Development Corporation Fund - to account for sales tax collected to fund the activities of the 4B Economic Development Corporation. Solana Public Improvement District (PID) Capital Projects Fund - to account for the acquisition or construction of capital facilities and improvements relating to the Solana public improvement district. Westlake Academy Expansion Capital Projects Fund - to account for proceeds from long-term financing and revenue and expenditures for authorized construction related to the expansion of Westlake Academy facilities. The Town adopts an annual appropriated budget for all governmental funds except capital projects, Solana PID capital projects, Public Arts, and Westlake Academy Expansion capital projects fund, which are project -length based budgets. A budgetary comparison schedule has been provided for all appropriate funds to demonstrate compliance with the budget. Proprietary Funds distinguish operating revenues and expenses from nonoperating 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 Town's Enterprise Fund are charges to customers for sales and services. Operating expenses for the Enterprise Fund include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenue and expenses not meeting this definition are reported as nonoperating revenue and expenses. The Town reports the following major proprietary funds: Utility Fund - to account for revenues and expenses related to providing water and sewer services to the general public on a continuing basis. Cemetery Fund - to account for the operations of the Town's cemetery. The Town reports the following fiduciary fund: Solana PID Custodial Fund - to account for bond proceeds, assessments, and related debt associated with bonds issued by the Town as an agent for the Solana public improvement district. As a general rule, the effect of interfund activity has been eliminated from the government -wide financial statements. Exceptions to this general rule are charges between the Town's water and wastewater function and various other functions of the government. Elimination of these charges would distort the direct costs and program revenue reported for the various functions concerned. 46 Town of Westlake Notes to the Financial Statements Amounts reported as program revenues include: 1) charges to customer or applicants for goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments. Internally dedicated resources are reported as general revenues rather than as program revenue. Likewise, general revenue includes all taxes. Assets, Liabilities, Deferred Inflows/Oufflows of Resources, and Net Position or Equity Cash and Cash Equivalents Cash and investments of all funds, including restricted cash, are available upon demand and are considered to be "cash equivalents:' For purposes of the statement of cash flows, the Town considers highly -liquid investments (including restricted assets) with an original maturity of three months or less when purchased to be cash equivalents. State statutes authorize the Town to invest in (1) obligations of the United States or its agencies and instrumentalities; (2) direct obligations of the State of Texas or its agencies; (3) other obligations, the principal of, and interest on, which are unconditionally guaranteed or insured by the State of Texas or the United States; (4) obligations of states, agencies, counties, cities, and other political subdivisions of any state having been rated as to investment quality by a nationally recognized investment rating firm and having received a rating of not less than "A" or its equivalent; (5) certificates of deposit by state or national banks domiciled in this state that are (a) guaranteed or insured by the Federal Deposit Insurance Corporation, or its successor; or, (b) secured by obligations that are described by (1) - (4); or (6) fully collateralized direct repurchase agreements having a defined termination date, secured by obligations described by (1) pledged with third -party selected or (2) approved by the Town, and placed through a primary government securities dealer. All investments are recorded at fair value based on quoted market prices. Fair value is the amount at which a financial instrument could be exchanged in a current transaction between willing parties. Receivables and Payables Transactions between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as "due to/from other funds" (i.e., the current portion of interfund loans) or "advances to/from other funds" (i.e., the non -current portion of interfund loans). All other outstanding balances between funds are reported as "due to/from other funds." Any residual balances outstanding between the governmental activities and business -type activities are reported in the government -wide financial statements as "internal balances." Advances between funds, as reported in the fund financial statements, are offset by nonspendable fund balance in applicable governmental funds to indicate that they are not available for appropriation and are not expendable available financial resources. The Town's property taxes are levied on October 1 on the assessed value listed as of the prior January 1 for all real and business personal property located in the Town. Assessed values are established at 100% of estimated market value. Property taxes attach as an enforceable lien on property as of January 1. Taxes are due by January 31 following the October 1 levy date and are considered delinquent after January 31 of each year. All property tax receivables are shown net of an allowance for uncollectibles. The net property tax receivable allowance is equal to management's estimate of uncollectible outstanding property taxes at September 30, 2021. 47 Town of Westlake Notes to the Financial Statements Restricted Assets Certain bond proceeds, as well as certain resources set aside for their repayment, are classified as restricted assets on the balance sheet because their use is limited by applicable bond covenants. Inventories and Prepaid Items Inventories, which are expended as they are consumed, are stated at the lower of cost or market on a first -in, first -out basis. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items using the consumption method in both the government -wide and fund financial statements. Fund Chanaes and Transactions between Funds Legally authorized transfers are treated as transfers in and out and are included as other financing sources (uses) of both governmental and proprietary funds. The Town allocates an indirect cost percentage of the salaries, wages and related costs of personnel who perform administrative services as well as other indirect costs necessary for the operation of various funds. Expenses are budgeted and paid from the appropriate fund. Capital Assets All capital assets are valued at historical cost or estimated historical cost if actual historical cost is not available. The cost of nominal maintenance and repairs that do not add value to the asset or materially extend assets' lives are not capitalized. Donated assets are valued at their acquisition value on the date donated. Assets capitalized have an original cost of $5,000 or more and three years or more of life. All infrastructure assets (e.g., roads, bridges, sidewalks, and similar items), regardless of the acquisition date or amount, have been included. Estimated historical cost for initial reporting of infrastructure assets (those reported by governmental activities) was valued by estimating the current replacement cost of the infrastructure and using an index to deflate the cost to the estimated acquisition/construction year. As the Town constructs or acquires additional capital assets, including infrastructure assets, they are capitalized and reported at historical cost. Depreciation has been calculated on each class of depreciable property using the straight-line method. Estimated useful lives are as follows: Assets Years Water and sewer system 10-50 Buildings 20-50 Machinery and equipment 3-30 Improvements 5-30 Information systems and software 3 Compensated Absences The Town's policy provides vacation and sick leave to be accrued at the start of employment. Employees earn 10 days of vacation and 10 days of sick leave between one year and five years of service. After completion of 5 years of service, 15 days of vacation and 15 days of sick leave per year are earned. After completion of 10 years of service, 20 days of vacation and 20 days of sick leave per year are earned. Unused vacation hours are paid upon termination or retirement at the employee's normal hourly rate. 48 Town of Westlake Notes to the Financial Statements Long -Term Obligations In the government -wide financial statements and proprietary fund types in the fund 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 straight-line method, which approximates the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as issuance costs during the current period. The face amount of the debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts are reported as other financing uses. Issuance costs, even if withheld from the actual proceeds, are reported as expenditures in the year of issuance. Fund Equity and Net Position The governmental fund financial statements present fund balances based on classifications that comprise a hierarchy that is based primarily on the extent to which the Town is bound to honor constraints on the specific purposes for which amounts in the respective governmental funds can be spent. The classifications used in the governmental fund financial statements are as follows: Nonspendable: This classification includes amounts that cannot be spent because they are either (a) not in spendable form or (b) are legally or contractually required to be maintained intact. Nonspendable items are not expected to be converted to cash or are not expected to be converted to cash within the next year. Restricted: This classification includes amounts for which constraints have been placed on the use of the resources either (a) externally imposed by creditors, grantors, contributors, or laws or regulations of other governments, or (b) imposed by law through constitutional provisions or enabling legislation. Committed: This classification includes amounts that can be used only for specific purposes pursuant to constraints imposed by board resolution of the Town council, the Town's highest level of decision making authority. These amounts cannot be used for any other purpose unless the Town council removes or changes the specified use by taking the same type of action that was employed when the funds were initially committed. This classification also includes contractual obligations to the extent that existing resources have been specifically committed for use in satisfying those contractual requirements. Assigned: This classification includes amounts that are constrained by the Town's intent to be used for a specific purpose but are neither restricted nor committed. In the General Fund, assigned amounts represent intended uses established by the Town Council or the Town Finance Director who has been delegated that authority. Unassigned: This classification includes the residual fund balance for the General Fund. The unassigned classification also includes negative residual fund balance of any other governmental fund that cannot be eliminated by offsetting of assigned fund balance amounts. In the government -wide financial statements, net position represents the difference between assets and deferred outflows and liabilities and deferred inflows. Net investment in capital assets consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowing used for the acquisition, construction or improvements of those assets, and adding back unspent proceeds. Net position is reported as restricted when there are limitations imposed on its use either though the enabling legislations adopted by the Town or through external restrictions imposed by creditors, grantors or laws or regulations of other governments. 49 Town of Westlake Notes to the Financial Statements The government -wide and fund level financial statements report restricted fund balances for amounts not available for appropriation or legally restricted for specific uses. When an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available, it is the Town's policy to use restricted resources first, then unrestricted resources as needed. When an expenditure is incurred forwhich committed, assigned, or unassigned fund balances are available, the Town considers amounts to have been spent first out of committed funds, then assigned funds, and finally unassigned funds. Pensions and Other Post -Employment Benefits (OPEB) For purposes of measuring the net pension/OPEB and total OPEB liabilities, pension and OPEB related deferred outflows and inflows of resources and pension and OPEB expense, the Town's specific information about its Fiduciary Net Position in the Texas Municipal Retirement System (TMRS) and Teachers Retirement System (TRS) and additions to/deductions from the Town's Fiduciary Net Position have been determined on the same basis as they are reported by TMRS and TRS. 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. For TMRS, information regarding the Town's Total Pension Liability and Total OPEB Liability is obtained from TMRS through reports prepared for the Town by TMRS consulting actuary, Gabriel Roeder Smith & Company, in compliance with Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions, and GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions. For TRS, information regarding the Town's Total Pension Liability and Total OPEB Liability is obtained from TRS which is a cost -sharing multi -employer defined benefit plan. Reports prepared are in compliance with Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pensions, and GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions. Deferred Outflows and 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 on the Statement of Net Position and Governmental Fund Balance Sheet. 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. In addition to liabilities, the statement of net position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of net position that applies to a future period and will not be recognized as an inflow of resources (revenue) until that time. The Town has the following items that qualify for reporting in these categories: Deferred Oufflow/Inflow from Gain or Loss on Refunding - these deferred outflows reported at the net position result 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. Deferred Oufflow/Inflows from Pensions/OPEB - these deferred outflows/inflows reported on the Statement of Net Position result from pension/OPEB contributions after the measurement date (deferred and recognized as a reduction of the related liability in the following fiscal year), differences in projected and actual earnings on pension/OPEB investments (deferred and amortized over a closed five-year period), and differences between expected and actual experience and/or changes in assumptions (deferred and amortized over the remaining average service life of participants.) 50 Town of Westlake Notes to the Financial Statements Deferred Outflow/Inflows from Contributions - these deferred outflows/inflows result from contributions made or received before time requirement is met. The deferred outflows/inflows from contributions are eliminated at the Statement of Activities and Net Position. Deferred Inflows from Unavailable Resources - these deferred inflows result from property tax receivables not being collected within 60 days of year-end. The deferred inflows from unavailable resources are recorded as revenues on the Governmental -wide Statement of Activities. Estimates The preparation of financial statements, in conformity with U.S. generally accepted accounting principles, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual amounts could differ from those estimates. Note 2. Cash and Investments Legal provisions generally permit the Town to invest in certificates of deposit, repurchase agreements, public funds investment pools, direct obligations of the United States of America or its subdivisions and state and local government securities. The Public Funds Investment Act (Government Code Chapter 2256) contains specific provisions in the areas of investment practices, management reports and establishment of appropriate policies. Among other things, it requires the Town to adopt, implement, and publicize its investment policy. That policy must address the following areas: (1) safety of principal and liquidity, (2) portfolio diversification, (3) allowable investments, (4) acceptable risk levels, (5) expected rates of return, (6) maximum allowable stated maturity of portfolio investments, (7) maximum average dollar - weighted maturity allowed based on the stated maturity date for the portfolio, (8) investment staff quality and capabilities, and (9) bid solicitation preferences for certificates of deposit. Statutes and the Town's investment policy authorized the Town to invest in the following investments as summarized in the table below: Maximum Maximum Authorized Maximum Percentage Investment I nv estment Type Maturity of Portfolio In One Issuer U.S. Government securities 5 Years 100% None State of Texas 5 Years 25% None States, agencies, counties, cities and other 5 Years 25% None Repurchase agreements 90 Days 100% None Certificates of deposits 5 Years 25% None Commercial paper 270 Days 25% None No-load money market mutual funds 90 Days 25% None Eligible investment pools 90 Days 100% None The Town did not engage in repurchase or reverse repurchase agreement transactions during the current year. 51 Town of Westlake Notes to the Financial Statements At year end, the carrying amount of the Town's deposits was $36,043,559 and the bank balance was $36,278,880. The bank balance was completely covered by federal deposit insurance and collateral held by the pledging financial institution in the Town's name. At year end, the carrying amount of the component units' deposits was $4,898,619 and the bank balance was $5,1 1 1,990. The bank balance was completely covered by federal deposit insurance and collateral held by the pledging financial institution in the component units' names. The carrying amount consists of $3,594,018 in cash and cash equivalents and $1,304,601 in restricted cash and cash equivalents. At September 30, 2021, the Town's cash and cash equivalents consist of and are classified in the accompanying financial statements are follows: Primary government: Cash and cash equivalents $ 35,460,031 Restricted cash and cash equivalents 614,135 Total primary government 36,074,166 Fiduciary funds: Restricted cash and cash equivalents 4,622,482 Total cash and cash equivalents $ 40,696,648 Deposits with financial institutions $ 36,043,559 Investments 4,653,089 Total cash and cash equivalents $ 40,696,648 Disclosures Relating to Interest Rate Risk This is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment the greater the sensitivity of its fair value to changes in market interest rates. In order to limit interest and market rate risk from changes in interest rates, the Town's investment policy sets a maximum stated maturity limit of two years for obligations of the United States Government, its agencies and instrumentalities (excluding mortgage backed securities) and one year for fully insured or collateralized certificates of deposit. No more than 80% of the Town's monthly average balance may be invested in money market funds. Additionally, the Town invests in an investment pool that purchases a combination of shorter term investments with an average maturity of 37 days thus reducing the interest rate risk. Information about the sensitivity of the fair values of the Town's investments to market interest rate fluctuations is provided by the following table that shows the distribution of the Town's Investments. As of September 30, 2021, the Town's investments were as follows: Carrying I nvestment Type Amount TexPool $ 205 Money market 4,652,884 Total $ 4,653,089 Weighted Average Fair Value Maturity (days) $ 205 37 days 4,652,884 30 days $ 4,653,089 52 Town of Westlake Notes to the Financial Statements Disclosures Relating to Credit Risk This is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required by (where applicable) the Public Funds Investment Act, the Town's investment policy, or debt agreements, and the actual rating as of year-end for each investment type. Minimum Rating Carrying Fair Legal as of Primary government Amount Value Rating Year-end I nv estments: TexPool $ 205 $ 205 N/A AAA-m Money market 4,652,884 4,652,884 N/A N/A Total $ 4,653,089 $ 4,653,089 Disclosures Relating to Concentration of Credit Risk The Town's investment policy is to avoid a concentration of assets in a specific maturity, a specific issue, or a specific class of investments. Disclosures Relating to Custodial Credit Risk Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The Public Funds Investment Act does not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits: The Public Funds Investment Act requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The market value of the pledged securities in the collateral pool must equal at least the bank balance less the FDIC insurance at all times. The Town requires all deposits to be covered by Federal Depository Insurance Corporation (FDIC) insurance and/or collateralized by qualified securities pledged by the Town's depository in the Town's name and held by the depository's agent. As of September 30, 2021, the Town's entire cash deposits with financial institutions in excess of federal depository insurance were fully collateralized. The Town categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. GASB Statement No. 72, Fair Value Measurement and Application, provides a framework for measuring fair value which establishes a three -level fair value hierarchy that describes the inputs that are used to measure assets and liabilities. Level 1 inputs are quoted prices (unadjusted) for identical assets or liabilities in active markets that a government can access at the measurement date. Level 2 inputs are inputs - other than quoted prices included within Level 1 - that are observable for an asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for an asset or liability. 53 Town of Westlake Notes to the Financial Statements The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs. If a price for an identical asset or liability is not observable, a government should measure fair value using another valuation technique that maximizes the use of relevant observable inputs and minimizes the use of unobservable inputs. If the fair value of an asset or a liability is measured using inputs from more than one level of the fair value hierarchy, the measurement is considered to be based on the lowest priority level input that is significant to the entire measurement. The Town has recurring fair value measurements as presented in the table below. The Town's investment balances and weighted average maturity of such investments are as follows: Investments not Subject to Fair Value: Investment Pools: TexPool Money market Total Value Fair Value Measurements Using Quoted Prices in Active Significant Markets for Other Significant Weighted Value at Identical Observable Unobservable Percent of Average September 30, Assets I nputs I nputs Total Maturity 2021 (Level1) (Level2) (Level3) Investments (Days) $ 205 $ 4,652,884 $ 4,653,089 $ Investment in State Investment Pools - $ $ - 0.00% 37 - - 100.00% 30 On September 1, 1989, local government investment pools became authorized investments for the majority of public entities in Texas. The Interlocal Cooperation Act was amended by the 71 st Texas Legislature to facilitate the creation of local government investment pools in Texas. This act permits the creation of investment pools to which a majority of political subdivisions (local governments) may delegate, by contract, the authority to make investments purchased with local investment funds and to hold legal title as custodian of the investments. TexPool was organized to conform with the Interlocal Cooperation Act, Chapter 791 of the Texas Government Code, and the Public Funds Investment Act, Chapter 2256 of the Texas Government Code. During the year ended September 30, 2021, the Town had investments with TexPool. TexPool, a public funds investment pool created by the Treasurer of the State of Texas acting by and through the Texas Treasury Safekeeping Trust Company, which is empowered to invest funds and acts as custodian of investments purchased with local investment funds. These investments are not required to be categorized because the investor is not issued securities, but rather it owns an undivided beneficial interest in the assets of the respective funds. The fair value of the position in TexPool is the same as the value of the pool shares. Restricted Cash Governmental Activities Within the governmental activities, $230,402 of restricted cash held in trust restricted in use for the acquisition or construction of capital facilities and improvements related to the Solana Public Improvement District. 54 Town of Westlake Notes to the Financial Statements Proprietary Fund Within the proprietary funds, $230,065 of restricted cash represents customer deposits received for water and sewer usage that are refundable upon termination of service; $103,668 represents remaining Texas Water Development Board bond proceeds to be spent on the Fort Worth waterline; and $50,000 of restricted cash represents a contribution restricted for cemetery improvements. Discretely Presented Component Units Within the discretely presented component units, the $1,304,601 in restricted cash and cash equivalents represents funds held for debt service. Note 3. Receivables Governmental activities receivable balance consists of the following as of September 30, 2021: Governmental Funds Debt Nonmajor Total Westlake Service Capital Governmental Governmental General Academy Fund Projects Funds Funds Receivables: Sales tax $ 836,540 $ $ - $ $ 278,915 $ 1,115,455 Property tax 5,935 1,737 - 7,672 Othertaxes 1,762 - 38,700 40,462 Franchise tax 157,883 - 157,883 Other 502,939 813,603 - 50,000 - 1,366,542 Gross receivables 1,505,059 813,603 1,737 50,000 317,615 2,688,014 Less: allowance for uncollectibles (58,661) - (434) - - (59,095) Net total receivables $ 1,446,398 $ 813,603 $ 1,303 $ 50,000 $ 317,615 $ 2,628,919 Business -type receivables balance consists of the following as of September 30, 2021: Business -Type Activities Utility Cemetery Fund Fund Total Receivables: Accounts $ 1,161,722 $ 4,200 $ 1,165,922 Other 848 - 848 Gross receivables 1,162,570 4,200 1,166,770 Less: allowance for uncollectibles - - - Net total receivables $ 1,162,570 $ 4,200 $ 1,166,770 55 Town of Westlake Notes to the Financial Statements Note 4. Capital Assets Capital asset activity for the year ended September 30, 2021, was as follows: Primary Government Beginning Ending Balance Increases Decreases Transfers Balance Governmental activities: Capital assets, not being depreciated: Land $ 12,446,059 $ - $ $ - $ 12,446,059 Construction in progress 1,455,133 1,005,196 (1,594,637) 865,692 Total assets not being depreciated 13,901,192 1,005,196 (1,594,637) 13,311,751 Capital assets, being depreciated: Capital improvements 34,294,176 26,302 1,228,549 35,549,027 Buildings 43,289,707 - - 43,289,707 Machinery and equipment 5,210,768 101,819 (49,084) - 5,263,503 Information systems and software 897,330 9,058 366,088 1,272,476 Total capital assets being depreciated 83,691,981 137,179 (49,084) 1,594,637 85,374,713 Less accumulated depreciation: Capital improvements (7,260,236) (913,215) - (8,173,451) Buildings (8,919,492) (881,458) - (9,800,950) Machinery and equipments (4,166,694) (219,878) 49,084 (4,337,488) Information systems and software (499,367) (198,645) - (698,012) Total accumulated depreciation (20,845,789) (2,213,196) 49,084 - (23,009,901) Total capital assets being depreciated 62,846,192 (2,076,017) - 1,594,637 62,364,812 Governmental activities capital assets, net $ 76,747,384 $ (1,070,821) $ - $ - $ 75,676,563 Beginning Ending Balance Increases Decreases Transfers Balance Business -type activities: Capital assets, not being depreciated: Construction in progress $ 329,030 $ - $ $ $ 329,030 Total assets not being depreciated 329,030 - 329,030 Capital assets, being depreciated: Capital improvements 14,899,416 - 14,899,416 Wastewater treatment rights 635,199 - 635,199 Machinery and equipment 3,710,614 37,913 (15,704) 3,732,823 Total capital assets being depreciated 19,245,229 37,913 (15,704) 19,267,438 Less accumulated depreciation: Capital improvements (6,253,383) (359,463) (6,612,846) Wastewater treatment rights (635,199) - - (635,199) Machinery and equipment (2,425,587) (145,660) 15,704 (2,555,543) Total accumulated depreciation (9,314,169) (505,123) 15,704 (9,803,588) Total capital assets being depreciated 9,931,060 (467,210) - 9,463,850 Business -type activities capital assets, net $ 10,260,090 $ (467,210) $ - $ $ 9,792,880 56 Town of Westlake Notes to the Financial Statements Depreciation was charged to departments of the primary government as follows: Governmental activities: General government $ 937,890 Public safety 477,636 Public works 797,670 Total depreciation expense - governmental activities $ 2,213,196 Business -type activities: Water and sewer $ 505,123 A summary of discretely presented component units' capital assets at August 31, 2021 follows: Texas Student Housing Corporation - Denton Project Beginning Ending Capital assets, not being depreciated: Land Total assets not being depreciated Capital assets, being depreciated: Buildings Furniture and fixtures Total capital assets being depreciated Less accumulated depreciation: Buildings Furniture and fixtures Total accumulated depreciation Total capital assets being depreciated Capital assets, net $ 2,200,000 $ - $ - $ 2,200,000 2,200,000 - - 2,200,000 25,705,000 - - 25,705,000 1,253,841 35,344 - 1,289,185 26,958,841 35,344 - 26,994,185 (16,636,845) (856,833) - (17,493,678) (1,232,010) (43,794) - (1,275,804) (17,868,855) (900,627) - (18,769,482) 9,089,986 (865,283) - 8,224,703 $ 11,289,986 $ (865,283) $ - $ 10,424,703 57 Town of Westlake Notes to the Financial Statements Texas Student Housing Corporation - College Station Project Capital assets, not being depreciated: Land $ 2,899,597 $ - $ - $ 2,899,597 Total assets not being depreciated 2,899,597 - - 2,899,597 Capital assets, being depreciated: Buildings 26,885,312 - - 26,885,312 Furniture and fixtures 3,437,138 - - 3,437,138 Total capital assets being depreciated 30,322,450 - - 30,322,450 Less accumulated depreciation: Buildings (14,230,237) (896,177) - (15,126,414) Furniture and fixtures (3,317,870) (29,292) - (3,347,162) Total accumulated depreciation (17,548,107) (925,469) - (18,473,576) Total capital assets being depreciated 12,774,343 (925,469) - 11,848,874 Capital assets, net $ 15,673,940 $ (925,469) $ - $ 14,748,471 58 Town of Westlake Notes to the Financial Statements Note 5. Long -Term Debt The Town issues general obligation bonds, certificates of obligation and tax notes to provide for the acquisition and construction of major capital facilities and infrastructure. Combination tax and revenue certificates of obligation are issued for both governmental and business -type activities. General obligation bonds, governmental revenue bonds and tax notes pledge the full faith and credit of the Town. A summary of long-term debt transactions for the year ended September 30, 2021, was as follows: Governmental activities: General obligation bonds and other obligations Unamortized bond premium Notes payable Capital leases Compensated absences Total OPEB liability - TM RS Net OPEB liability - TRS Net pension liability - TMRS Net pension liability - TRS Total governmental activities Business -type activities: Certificates of obligation Contractual obligations Unamortized bond premium Compensated absences Total OPEB liability - TM RS Net pension liability - TM RS Total business -type activities Amount Beginning Ending Due within Balance Additions Reductions Balance One year $ 30,557,900 $ 7,645,000 $ (6,328,350) $ 31,874,550 $ 1,808,250 1,279,473 587,040 (326,197) 1,540,316 - 128,373 - (36,677) 91,696 36,678 398,012 - (245,091) 152,921 152,921 368,239 177,810 (187,090) 358,959 35,896 73,555 23,157 - 96,712 - 2,830,719 - (516,148) 2,314,571 - 1,282,910 - (62,429) 1,220,481 - 1,502,914 1,484,513 - 2,987,427 - $ 38,422,095 $ 9,917,520 $ (7,701,982) $ 40,637,633 $ 2,033,745 Amount Beginning Ending Due within Balance Additions Reductions Balance One year $ 2,891,100 $ - $ (113,650) $ 2,777,450 $ 114,750 4,679,944 - - 4,679,944 4,679,944 26,365 - (1,172) 25,193 - 69,031 27,027 (23,298) 72,760 7,276 9,035 2,844 - 11,879 - 157,578 - (7,700) 149,878 - $ 7,833,053 $ 29,871 $ (145,820) $ 7,717,104 $ 4,801,970 The Town's accrued interest for general obligation bonds reported in governmental activities was $131,016 and certificates of obligation reported in business -type activities for $10,676. Additional accrued interest for contractual obligations of $11,001,090 is reported in the business -type activities. 59 Town of Westlake Notes to the Financial Statements General Obligation Bonds, Tax Notes and Certificates of Obligation General obligation bonds, tax notes and certificates of obligation are as follows as of September 30, 2021 General Obligations Bonds, Tax Notes, and Final Business - Certificates of Obligation Maturity Interest Rates Governmental Type $9,320,000 Certificates of Obligation, Series 2013 2043 2.0-4.0% $ 6,937,550 $ 857,450 $2,200,000 General Obligation Refunding Bonds, Series 2013 2028 2.0-2.5% 1,080,000 - $1,910,000 General Obligation Refunding Bonds, Series 2014 2032 2.0-5.0% 1,515,000 - $9,180,000 Certificate of Obligation Bonds, Series 2016 2046 2.0-5.0% 8,350,000 - $5,795,000 General Obligation Refunding Bonds, Series 2017 2032 2.0-5.0% 5,665,000 - $1,530,000 Tax Notes, Series 2017 2024 2.0-5.0% 682,000 - $2,100,000 Certificates of Obligation, Series 2018 2028 2.0-2.7% - 1,920,000 $3,215,000 Certificates of Obligation, Series 2021 2041 4.007o 3,215,000 - $4,430,000 General Obligation Refunding Bonds, Series 2021 2031 2.0-4.0% 4,430,000 - $ 31,874,550 $ 2,777,450 Debt service requirements of certificates of obligation, tax notes, and general obligations to be retired from governmental funds are as follows: Year Ending Total September 30, Principal Interest Requirements 2022 $ 1,808,250 $ 1,046,510 $ 2,854,760 2023 1,836,700 1,018,674 2,855,374 2024 1,895,600 965,346 2,860,946 2025 1,693,600 909,758 2,603,358 2026 1,746,950 851,678 2,598,628 2027-2031 9,768,600 3,270,480 13,039,080 2032-2036 5,376,050 1,767,201 7,143,251 2037-2041 4,625,000 1,043,668 5,668,668 2042-2046 3,123,800 271,208 3,395,008 Total $ 31,874,550 $ 11,144,523 $ 43,019,073 :s Town of Westlake Notes to the Financial Statements Debt service requirements of certificates of obligation to be retired from proprietary funds as follows: Year Ending Total September 30, Principal Interest Requirements 2022 $ 114,750 $ 84,051 $ 198,801 2023 120,300 81,173 201,473 2024 121,400 78,075 199,475 2025 121,400 74,884 196,284 2026 128,050 71,542 199,592 2027-2031 736,400 298,134 1,034,534 2032-2036 838,950 171,834 1,010,784 2037-2041 495,000 50,664 545,664 2042-2043 101,200 4,092 105,292 Total $ 2,777,450 $ 914,449 $ 3,691,899 Notes Payable In March 2014, the Town received a $366,774 loan from Bennett Benner Pettit, the proceeds of which were used to fund a portion of the Westlake Academy expansion project. The terms of the note call for ten annual payments at Oho interest. Year Ending Note September 30, Payments 2022 36,678 2023 36,678 2024 18,340 Total $ 91,696 Capital Leases In 2020, the Academy acquired equipment and software with a historical cost of $585,623 under a capital lease. The following schedule shows the future minimum payments under the lease as of August 31, 2021: Year Ending Annual August31, Principal Interest Lease Payments 2022 $ 152,921 $ 5,017 Total $ 152,921 $ 5,017 $ 157,938 $ 157,938 M. Town of Westlake Notes to the Financial Statements Contractual Obligations Proprietary funds contractual obligations as of September 30, 2021 are as follows: Business - Contractual Obligations Maturity Interest Rate Type Limited pledge contractual obligation: Dove Road Water Line and West Pump Station 2022 6.75% $ 4,679,944 Dove Road Water Line and West Pump Station - In April 2000, the Town approved an agreement with the Hillwood Development Corporation (Hillwood). In the agreement, Hillwood agreed to bear all initial costs for the design, engineering and constructions of the Dove Road Water Line and the West Pump Station that will service the residents of the Town. The Town agreed to reimburse Hillwood for the cost of the project upon completion and the Town's acceptance of the project, which occurred in June 2001, solely from a $.25 charge per 1,000 gallons of usage. The Town further agreed to deposit debt service revenue of $.25 per 1,000 gallons of usage collected from Town residents to fund its repayment to Hillwood. Debt service revenue will be allocated between Hillwood service area and Town service area by 52% and 48%, respectively and deposited into two separate debt service funds that will result in debt service revenue to pay the respective share of the construction cost. The Town recorded a limited pledge contractual obligation of $4,679,944 for the project cost based upon the terms of the agreement, which requires 239 monthly principal and interest payments to Hillwood, at an interest rate of 6.75%. If the Town collects insufficient funds to pay current interest on the debt, the interest payment may be deferred. No portion of debt payments will be applied to the principal component, until all current and deferred interest is fully paid. The obligation of the Town to pay the purchase price and interest thereon is not a general obligation of the Town but is a limited recourse obligation payable solely from debt service revenue. The schedule of future payments by the Town under these agreements is as follows: Year Ending September 30, Principal Past Due $ - 2022 4,679,944 Total Interest Requirements 10,189, 745 $ 10,189, 745 811,345 5,491,289 Total $ 4,679,944 $ 11,001,090 $ 15,681,034 On August 15, 2021, the Town issued $3,215,000 of Combination Tax and Revenue Certificates of Obligation, Series 2021. Proceeds from the sale of these bonds will be used for various street and drainage infrastructure projects as well as park and cemetery improvements. Current Refunding On August 15, 2021, the Town issued $4,430,000 of General Obligation Refunding Bonds, Series 2021. Proceeds from the sale, including $337,298 in premiums, were deposited with an escrow agent to refund $1,212,000 of Certificates of Obligation, Series 2011 and $3,465,000 of General Obligation Refunding Bonds, Series 2011. 62 Town of Westlake Notes to the Financial Statements The net carrying value of the old debt exceeded the reacquisition price by $150,777. The amount is reported as a deferred inflow of resources for the Governmental Activities in the Statement of Net Position and will be amortized over the remaining life of the bonds. The bonds were refunded to reduce the Town's total debt service payments over 10 years by $302,725 and this resulted in an economic gain (difference between the net present values of the debt service payments on the old and new debt) of $289,901. Compensated Absences Although compensated absences are liquidated by the fund to which they relate, the significant portion of the governmental activities compensated absences has typically been liquidated by the general fund. Discretely Presented Component Units - Long -Term Debt Texas Student Housino Corporation -Denton Project The long-term debt activity of the Denton Project is as follows: Revenue Bonds: 2001 A Bonds 2001 B Bonds Discount on bonds Total Beginning Balance $ 18,140,000 $ 3,240,000 (372,444) Increases E1 $ 21,007,556 $ - $ Amounts Ending Due Within Decreases Balance One Year (500,010) $ 17,639,990 $ 17,639,990 3,240,000 3,240,000 37,485 (334,959) (462,525) $ 20,545,031 $ 20,879,990 The Bonds are payable solely from the revenues generated by the Denton Property and are secured by the revenues pledged and assigned under the terms of the Trust Indenture. The Town of Westlake does not have any liability for the payment of the bonds as the bonds are non -recourse to both the Town of Westlake and Texas Student Housing Authority. Interest rates on the bonds range from 5.00% to 1 1.00% and are payable semi-annually on July 1 and January 1 of each year thereafter. At August 31, 2021, the Project was not in compliance with certain covenants of the Indenture including insufficient funds in some of the required funds and a fixed charges ratio less than 1.25. In addition, all required principal payments on the Series B bonds had not been made as of August 31, 2021. Upon certain events of default either the trustee, or owners of not less than 25% in aggregate principal of the bonds then outstanding, may declare the principal and all interest then due to be immediately due and payable. 63 Town of Westlake Notes to the Financial Statements The debt service requirements of the bonds are as follows: Year Ending Total August 31, Principal Interest Requirements Past Due $ 2,259,990 $ 11,393,644 $ 13,653,634 2022 1,330,000 1,343,530 2,673,530 2023 1,430,000 1,248,483 2,678,483 2024 1,535,000 1,145,963 2,680,963 2025 1,645,000 1,035,835 2,680,835 2026 1,765,000 917,550 2,682,550 2027-2031 10,915,000 2,483,760 13,398,760 $ 20,879,990 $ 19,568,765 $ 40,448,755 Texas Student Housing Corporation - College Station Project The Project's installment note payable is summarized as follows: Lender/Security/Due/Date Rate Balance Cambridge Student Housing Financing Company, L.P.; substantially all assets and assignment of rents: due November 1, 2039 8.00% $ 28,205,000 The following is a summary of long-term debt transactions of the Project for the year ended August 31, 2021: Amounts Beginning Ending Due Within Balance Increases Decreases Balance One Year Revenue Certificates $ 28,205,000 $ - $ - $ 28,205,000 $ 28,205,000 The debt is to be amortized through 2040 with varying payments. The annual requirements to amortize the Project's outstanding installment notes payable as of August 31, 2021 are as follows: Year Ending August 31, Principal Interest Total Past Due 2022 2023 2024 2025 2026 2027-2031 2032-2036 2037-2040 Total $ 3,215,800 895,000 495,000 530,000 570,000 615,000 4,130,000 5,975,000 $ 28,816,343 1,464,122 1,410,935 1,372,495 1,331,160 1,286,580 4,626,153 4,275,367 $ 32,032,143 2,359,122 1,905,935 1,902,495 1,901,160 1,901,580 8,756,153 10,250,367 $ 28,205,000 $ 46,437,373 $ 74,642,373 64 Town of Westlake Notes to the Financial Statements Class C and D bonds are in default and the property does not generate enough revenue to pay the debt obligations. All of the Class C and D bonds issued remain outstanding as of August 31, 2021. Each class has certain rights and privileges, as contained in the private placement memorandum. As a part of the offering, the Project entered into a trust agreement with The Bank of New York (the Trustee) for the purpose of determining that each class is paid in accordance with the private placement memorandum. At August 31, 2021, the Project was not in compliance with the fixed charge coverage ratio. As a result, the lender may accelerate the maturity of the unpaid portion of the principal payable under the installment sale agreement. However, the Authority does not anticipate this event will occur, since foreclosure by private interests would result in the loss of tax-exempt status for the Project. The Town of Westlake does not have any liability for the payment of debt of the discretely presented component units as the bonds are non -recourse to both the Town and Texas Student Housing Authority. Note 6. Unearned Revenue / Deferred Inflows of Resources Unearned revenue in the proprietary fund of $279,514 relates to the collection of the entire amount due on fifteen Ductbank leases as follows: three leases with AT&T local network services ranging from 5 - 30 years; six leases with Verizon Southwest ranging from 5-30 years; two five-year leases with MCI Metro; three five-year lease with L3 Communications for use of the Town's Ductbank; and one five-year lease with Charter. Governmental funds report deferred inflows of resources in connection with receivables for revenue that is not considered to be available to liquidate liabilities of the current period. At the end of the current fiscal year, deferred inflows of resources reported in the governmental funds consist of $4,451 and $1,303 of unavailable property taxes in the General Fund and Debt Service Fund, respectively. Governmental funds also reported unearned revenues these unearned revenues include $21 1,733 of State and Local Fiscal Recovery Funds and $5,029 received from other sources. These funds were received in advance of funds being earned. 65 Town of Westlake Notes to the Financial Statements Note 7. Federal and State Program Revenues The Town received financial assistance from various federal and state governmental agencies in the form of grants for Westlake Academy. The disbursement of funds received under these programs generally requires compliance with terms and conditions specified in the grant agreements and are subject to audit by the grantor agencies. Any unallowed disbursement resulting from such audits becomes a liability of the Town. In the opinion of the Town management, no material refunds will be required as a result of unallowed disbursements (if any) by the grantor agencies. Sources of federal and state program revenues for the year ended September 30, 2021, were as follows: Westlake Source Academy Federal program revenues: U.S. Department of Education - Passed through State Department of Education Total federal program revenues $ 121,678 State program revenues: State Department of Education $ 8,457,552 Note 8. Interfund Balances and Transactions Interfund receivables and payables at September 30, 2021, were as follows: General Fund Nonmajor governmental funds: 4B Economic Development Fund Due From Other Funds $ 278,846 $ $ 278,846 $ Due To Other Funds 278,846 278,846 The $278,846 receivable in the General Fund and payable from the 4B Economic Development Fund is related to the sales tax receivable balance. Inter -fund transfers are reported in the governmental funds and proprietary fund financial statements. In the government -wide statements, inter -fund transfers are eliminated within the governmental activities column and business -type column, as appropriate. Individual fund transfers for fiscal year 2021 were as follows: Transfer out Transfer in Amount Purpose General Fund Debt Service Fund $ 357,169 Debt service payments Nonmajor Governmental Capital projects fund 1,000,000 For Westlake Academy capital projects Nonmajor Governmental Debt Service Fund 1,593,092 Debt service payments Utility Fund General Fund 205,014 Fort Worth impact revenue $ 3,155,275 Town of Westlake Notes to the Financial Statements Note 9. Interlocal Agreement with the City of Southlake In August 1995, the Town entered into an agreement with the City of Southlake to allow the Town to utilize capacity in a sewer line and to set forth their respective rights and obligations with respect to the sewer line owned by the City of Southlake. The Town is obligated to share in the cost of construction, operation and maintenance of the sewer line. The sewer line was constructed in 2000. Additionally, the Town must pay the City of Southlake all transportation, treatment and related costs allocable to the metered flow of sewage from the Town into the sewer line. Costs associated with this agreement for the year ended September 30, 2021 were $964,683. Note 10. Water Purchase Contract The Town has a contract with the City of Fort Worth, Texas, to purchase water. Under the contract, the Town may obtain from the City of Fort Worth, a supply of potable water at a reasonable rate based on water usage. The rate charges are subject to minimum annual contract payments. Water expense for the year ended September 30, 2021 was $1,278,398. Note 11. Town of Westlake and Westlake Academy Pension Plans The Town provides for two pension plans; one provides for defined retirement pension benefits to the Town's employees, Texas Municipal Retirement System - TMRS, and the other provides defined retirement pension benefits to teachers at Westlake Academy, Teacher Retirement System of Texas (TRS). Both plans are described in detail below. Aggregate amounts for the two pension plans are as follows: TM RS TRS Total Pension Liability $ 1,370,359 $ 2,987,427 $ 4,357,786 Deferred outflows of resources 583,500 2,100,145 2,683,645 Deferred inflows of resources 262,935 396,946 659,881 Pension Expense 535,572 1,184,539 1,720,111 TMRS Plan Description The Town participates as one of 895 plans in the nontraditional, joint contributory, hybrid defined benefit pension plan administered by the Texas Municipal Retirement System (TMRS). TMRS is an agency created by the State of Texas and administered in accordance with the TMRS Act, Subtitle G, Title 8, Texas Government Code (the TMRS Act) as an agent multiple -employer retirement system for municipal employees in the State of Texas. The TMRS Act places the general administration and management of the System with a six -member Board of Trustees. Although the Governor, with the advice and consent of the Senate, appoints the Board, TMRS is not fiscally dependent on the State of Texas. TMRS's defined benefit pension plan is a tax -qualified plan under Section 401 (a) of the Internal Revenue Code. TMRS issues a publicly available annual comprehensive financial report (ACFR) that can be obtained by writing to TMRS, P.O. Box 149153, Austin, Texas, 78714-9153 or by calling 800-924-8677. In addition, the report is available on TMRS' website at www.tmrs.com. All eligible employees of the Town are required to participate in TMRS. M. Town of Westlake Notes to the Financial Statements TMRS Benefits Provided TMRS provides retirement, disability, and death benefits. Benefit provisions are adopted by the governing body of the Town, 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 Town -financed monetary credits with interest were used to purchase an annuity. Members may choose to receive their retirement benefit in one of seven payments 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. TMRS Employees Covered By Benefit Terms At the December 31, 2020 valuation and measurement date, the following employees were covered by the benefit terms: Inactive employees of beneficiaries currently receiving benefits 16 Inactive employees entitled to but not yet receiving benefits 31 Active employees TMRS Contributions 46 93 The contribution rates for employees in TMRS are either 5%, 6%, or 7% of employee gross earnings, and the Town matching percentages are either 100%, 150%, or 200%, both as adopted by the governing body of the Town. Under the state law governing TMRS, the contribution rate for each Town is determined annually by the actuary, using the Entry Age Normal (EAN) actuarial cost method. The actuarially determined rate is the estimated amount necessary to finance the cost of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees for the Town were required to contribute 7% of their annual gross earnings during the fiscal year. The contribution rates for the Town was 11.77% in calendar years 2020 and 2021. The Town's contributions to TMRS for the year ended September 30, 2021, were $524,995, and were equal to the required contributions. TMRS Net Pension Liability The Town's Net Pension Liability (NPL) was measured as of December 31, 2020, and the Total Pension Liability (TPL) used to calculate the Net Pension Liability was determined by an actuarial valuation as of that date. TMRS Actuarial Assumptions The Total Pension Liability in the December 31, 2020 actuarial valuation was determined using the following actuarial assumptions: • Inflation 2.5% per year • Overall payroll growth 3.5% to 1 1.5%, including inflation • Investment Rate of Return 6.75%, net of pension plan investment expense, including inflation • Amortization method: Level percentage of payroll, closed • Actuarial Cost Method: Entry Age Normal Town of Westlake Notes to the Financial Statements Salary increases were based on a service -related table. Mortality rates for post -retirement were based on the 2019 Municipal Retirees of Texas Mortality Tables. The rates are projected on a fully generational basis with the scale UMP. Mortality rates for pre -retirement were based on PUB(10) mortality tables, with the Public Safety table used for males and the General Employee table used for females. The rates are projected on a fully generational basis with scale UMP. Actuarial assumptions used in the December 31, 2020, valuation were developed primarily from the actuarial investigation of the experience of TMRS over the four-year period from December 31, 2014 to December 31, 2018. They were first adopted in 2019 and first used in the December 31, 2019 actuarial valuations. The pension plan's policy in regard to the allocation of invested assets is established and may be amended by the Board. Plan assets are managed on a total return basis with an emphasis on both capital appreciation and the production of income, in order to satisfy the short-term and long-term funding needs of TMRS. The long-term expected rate of return on pension plan investments was determined using a building- block method in which best estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. In determining their best estimate of a recommended investment return assumption under the various alternative asset allocation portfolios, GRS focused on the area between (1) arithmetic mean (aggressive) without an adjustment for time (conservative) and (2) the geometric mean (conservative) with an adjustment for time (aggressive). The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: Long -Term Expected Real Rate of Return Asset Class Target Allocation (Arithmetic) Global Equity 30.0% 5.30% Core Fixed Income 10.0% 1.25% Non -Core Fixed Income 20.0% 4.14% Real Return 10.0% 3.85% Real Estate 10.0% 4.00% Absolute Return 10.0% 3.48% Private Equity 10.0% 7.75% Total 100.0% e Town of Westlake Notes to the Financial Statements TMRS 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 remain at the current 7% 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. TMRS Changes in the Net Pension Liability Balance at 12/31 /2019 Changes for the year: Service Cost Interest Change of benefit terms Difference between expected and actual experience Changes of assumptions Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Administrative expense Other changes Net Changes Balance at 12/31/20 Increase (Decrease) Total Plan Net Pension Fiduciary Pension Liability 1-1 Net Position 1l \ Liability 1-1 1l $ 9,514,373 $ 8,073,885 $ 1,440,488 683,693 - 683,693 660,928 - 660,928 (5,405) - (5,405) - 500,613 (500,613) - 297,813 (297,813) - 615,040 (615,040) (129,398) (129,398) - (3,966) 3,966 - (155) 155 1,209,818 1,279,947 (70,129) $ 10,724,191 $ 9,353,832 $ 1,370,359 Net Pension Liability as a Percentage of Covered Payroll is 32.21 %. 70 Town of Westlake Notes to the Financial Statements TMRS Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability of the Town, calculated using the discount rate of 6.75%, as well as what the Town's net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (5.75%) or 1-percentage-point higher (7.75%) than the current rate: 1% Decrease in Discount Rate Discount Rate (5.75%) (6.75%) I % Increase in Discount Rate (7.75%) Net pension liability $ 3,006,623 $ 1,370,359 $ 24,755 TMRS 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. TMRS Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended September 30, 2021, the Town recognized pension expense of $535,572. At September 30, 2021, the Town reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Difference between expected and actual economic experience Changes in actuarial assumptions Difference between projected and actual investment earnings Contributions subsequent to the measurement date Deferred Deferred Outflows of Inflows of Resources Resources $ 149,801 $ 32,618 54,764 - 230,317 378,935 Total $ 583,500 $ 262,935 $378,935 reported as deferred outflows of resources related to pensions resulting from contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability for the year ending September 30, 2022. FA Town of Westlake Notes to the Financial Statements Other amounts reported as deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows: Year ended Net Deferred September 30, Outflows (Inflows) 2022 $ (16,416) 2023 51,586 2024 (85,123) 2025 (8,417) Total $ (58,370) Defined Benefit Pension Plan - TRS TRS Plan Description The Academy participates in a cost -sharing multiple -employer defined benefit pension that has a special funding situation. The plan is administered by the Teacher Retirement System of Texas (TRS). TRS's defined benefit pension plan is established and administered in accordance with the Texas Constitution, Article XVI, Section 67 and Texas Government Code, Title 8, Subtitle C. The pension trust fund is a qualified pension trust under Section 401 (a) of the Internal Revenue Code. The Texas Legislature establishes benefits and contribution rates within the guidelines of the Texas Constitution. The pension's Board of Trustees does not have the authority to establish or amend benefit terms. All employees of public, state -supported educational institutions in Texas who are employed for one-half or more of the standard work load and who are not exempted from membership under Texas Government Code, Title 8, Section 822.002 are covered by the system. TRS Pension Plan Fiduciary Net Position Detailed information about the Teacher Retirement System's fiduciary net position is available in a separately issued Annual Comprehensive Financial Report that includes financial statements and required supplementary information. That report may be obtained on the Internet at https://www.trs.texas.gov/Pages/a bout_ archive_cafr.aspx; by writing to TRS at 1000 Red River Street, Austin, TX, 78701-2698; or by calling (512) 542-6592. TRS Benefits Provided TRS provides service and disability retirement, as well as death and survivor benefits, to eligible employees (and their beneficiaries) of public and higher education in Texas. The pension formula is calculated using 2.3 percent (multiplier) times the average of the five highest annual creditable salaries times years of credited service to arrive at the annual standard annuity except for members who are grandfathered, the three highest annual salaries are used. The normal service retirement is at age 65 with five years of credited service or when the sum of the member's age and years of credited service equals 80 or more years. Early retirement is at age 55 with five years of service credit or earlier than 55 with 30 years of service credit. There are additional provisions for early retirement if the sum of the member's age and years of service credit total at least 80, but the member is less than age 60 or 62 depending on date of employment, or if the member was grandfathered in under a previous rule. There are no automatic post - employment benefit changes; including automatic COLAs. Ad hoc post -employment benefit changes, including ad hoc COLAs can be granted by the Texas Legislature as noted in the Plan description above. 72 Town of Westlake Notes to the Financial Statements TRS Contributions Contribution requirements are established or amended pursuant to Article 16, section 67 of the Texas Constitution which requires the Texas legislature to establish a member contribution rate of not less than 6% of the member's annual compensation and a state contribution rate of not less than 6% and not more than 10% of the aggregate annual compensation paid to members of the system during the fiscal year. Employee contribution rates are set in state statute, Texas Government Code 825.402. The Texas Pension Reform Bill (Senate Bill 12) of the 86r" Texas Legislature amended Texas Government Code 825.402 for member contributions and increased both employee and employer contribution rates for plan years 2020 through 2025. Contribution rates 2020 2021 Member 7.70% 7.70% Non -employer contributing entity (State) 7.50% 7.50% Employers (District) 7.50% 7.50% The contribution amounts for the district's fiscal year 2021 are as follows: 2021 Employer contributions $ 222,306 2021 Member contributions $ 469,856 2020 Plan year NECE on -behalf contributions (state) $ 316,819 Contributors to the plan include members, employers and the State of Texas as the only non -employer contributing entity. The State contributes to the plan in accordance with state statutes and the General Appropriations Act (GAA). As the non -employer contributing entity for public education and junior colleges, the State of Texas contributes to the retirement system an amount equal to the current employer contribution rate times the aggregate annual compensation of all participating members of the pension trust fund during that fiscal year reduced by the amounts described below which are paid by the employers. Employers (public school, junior college, other entities or the State of Texas as the employer for senior universities and medical schools) are required to pay the employer contribution rate in the following instances: • On the portion of the member's salary that exceeds the statutory minimum for members entitled to the statutory minimum under Section 21.402 of the Texas Education Code. • During a new member's first 90 days of employment. • When any part or all of an employee's salary is paid by federal funding sources, a privately sponsored source, from non -educational and general, or local funds. • When the employing district is a public junior college or junior college district, the employer shall contribute to the retirement system an amount equal to 50% of the state contribution rate for certain instructional or administrative employees; and 100% of the contribution rate for all other employees. 73 Town of Westlake Notes to the Financial Statements In addition to the employer contributions listed above, there are two additional surcharges an employer is subject to: • When employing a retiree of the Teacher Retirement System the employer shall pay both the member contribution and the state contribution as an employment after retirement surcharge. • Public education employer contribution - all public schools and regional education service centers must contribute 1.5% of the member's salary beginning in September 1, 2019, gradually increasing to 2.0% on September 1, 2024. TRS Actuarial Assumptions The total pension liability in the August 31, 2019 actuarial valuation was determined using the following actuarial assumptions: Valuation Date Actuarial Cost Method Asset Valuation Method Single Discount Rate Long-term expected Investment Rate of Return Municipal bond rate as of August 2019 Inflation Salary increases including inflation Ad hoc post -employment benefit changes Active mortality rates August 31, 2019 rolled forward to August 2020 Individual Entry Age Normal Market Value 7.25% 7.25% 2.33%. Source for the rate is the fixed Income Market Data/Yield Curve/Date Municipal Bonds with 20 Years to maturity that include only federally tax-exempt Municipal bonds as reported in Fidelity Index's "20-Year Municipal GO AA Index" 2.30% 3.05% to 9.05% includes inflation None Based on 90% of the RP 2014 Employing Mortality Tables for males and females with full generational mortality. The post - retirement mortality rates for healthy lives were based on the 2018 TRS of Texas Health Pensioner Mortality Tables with full Generational projection using the ultimate Improvement rates from the most recently Published projective scale U-MP. The actuarial methods and assumptions are primarily based on a study of actual experience for the four-year period ending August 31, 2017 and adopted in July 2018. 74 Town of Westlake Notes to the Financial Statements TRS Discount Rate and Long -Term Expected Rate of Return A single discount rate of 7.25% was used to measure the total pension liability. The single discount rate was based on the expected rate of return on pension plan investments of 7.25%. The projection of cash flows used to determine the single discount rate assumed that contributions from active members and those of the contributing employers and the non -employer contributing entity will be made at the statutorily required rates. Based on these assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. The long-term expected rate of return on pension plan investments was determined using a building- block method in which best estimates 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. Best estimates of geometric real rates of return for each major asset class included in the Systems target asset allocation as of August 31, 2020 are summarized below: Long-term Expected Portfolio 2019 PYTarget Net Target Real Rate of Asset Class Allocation* Allocation** Return Global Equity U.S. 18% 3.90% 0.99% Non-U.S. Developed 13% 5.10% 0.92% Emerging Markets 9% 5.60% 0.83% Private Equity 14% 6.70% 1.41% Stable Value Government bonds 16% -0.07% -0.05% Absolute Return 0% 1.80% 0.00% Stable Value Hedge Funds 5% 1.90% 0.11% Cash Real Return Real Estate 15% 4.60% 1.02% Energy, Natural Resources, and inlation 6% 6.00% 0.42% Commodities 0% 0.80% 0.00% Risk Parity Risk Parity 8% 3.00% 0.30% Asset Allocation Leverage Cash 2% -1.50% -0.03% Asset Allocation Leverage -6% -1.30% 0.08% Inflation Expectation 2.00% Volatility Drag*** -0.67% Total 100.0% 7.33% * Target Allocation based on the Plan Year 2020 policy model ** Capital Market Assumptions come from AONHewitt (as of 8/31 /2020) *** Volatility Drag results from the conversion between arithmetic and geometric mean 75 Town of Westlake Notes to the Financial Statements TRS Discount Rate Sensitivity Analysis The following schedule shows the impact of the Net Pension Liability if the discount rate used was 1 % less than and 1 % greater than the discount rate that was used (7.25%) in measuring the 2020 Net Pension Liability. 1 % Decrease in Discount 1 % Increase in Discount Rate (6.25%) Rate (7.25%) Discount Rate (8.25%) Academy's proportionate share of the TRS net pension liability $ 4,606,558 $ 2,987,427 $ 1,671,918 TRS Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At August 31, 2021, the Academy reported a liability of $2,987,427 for its proportionate share of the TRS's net pension liability. This liability reflects a reduction for State pension support provided to the Academy. The amount recognized by the Academy as its proportionate share of the net pension liability, the related State support, and the total portion of the net pension liability that was associated with the Academy were as follows: Academy's proportionate share of the collective net pension liability $ 2,987,427 State's proportionate share that is associated with Academy 4,1 12,478 $ 7,099,905 The net pension liability was measured as of August 31, 2020 and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as August 31, 2019 rolled forward to August 31, 2020. The Academy's proportion of the net pension liability was based on the Academy's contributions to the pension plan relative to the contributions of all employers to the plan for the period September 1, 2019 thru August 31, 2020. At August 31, 2020, the employer's proportion of the collective net pension liability was 0.0055779% which was an increase of 0.0026868% from its proportion measured as of August 31, 2019. TRS Changes since the Prior Actuarial Valuation There were no changes in assumptions or benefits terms that affected measurement of the total pension liability since the prior measurement date. For the year ended August 31, 2021, the Academy recognized pension expense of $1,184,539 and revenue of $494,640 for support provided by the State. 76 Town of Westlake Notes to the Financial Statements At August 31, 2021, the Academy reported its proportionate share of the TRS's deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Deferred Outflows Deferred Inflows of Resources of Resources Difference between expected and actual economic experience Changes in actuarial assumptions Changes in proportionate share Difference between projected and actual investment earnings Contributions paid to TRS subsequent to the measurement date Total $ 5,455 $ 83,371 693,189 294,739 1,118,717 18,836 60,478 - 222,306 - $ 2,100,145 $ 396,946 The $222,306 reported as a deferred outflow of resources resulting from Academy contributions made subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ending August 31, 2022. The other amounts of the employer's balances of deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows: Year Ended Net Deferred Aug. 31, Outflows (Inflows) 2022 $ 335,659 2023 346,967 2024 340,767 2025 241,902 2026 160,954 Thereafter 54,644 Total $ 1,480,893 77 Town of Westlake Notes to the Financial Statements Note 12. Other Post -Employment Benefits (OPEB) The Town provides for two other post -employment benefit (OPEB) plans; one provides for postemployment health insurance benefits for teachers at Westlake Academy through a multiple - employer defined benefit medical plan Texas Public School Retired Employees Group Insurance Program (TRS-Care), and the other is the Texas' Municipal Retirement System Supplemental Death Benefits Fund (TMRS-SDBF), a single employer defined benefit OPEB plan for the Town employees. Both plans are described in detail below. Aggregate amounts for the two OPEB plans are as follows: TM RS SDBF TRS-Care Total OPEB Liability $ 108,591 $ 2,314,571 $ 2,423,162 Deferred outflows of resources 33,029 416,945 449,974 Deferred inflows of resources 4,082 1,694,859 1,698,941 OPEB Expense 15,709 (39,985) (24,276) TMRS-SDBF Plan Description Texas Municipal Retirement System ("TMRS") administers a defined benefit group -term life insurance plan known as the Supplemental Death Benefits Fund ("SDBF"). This is a voluntary program in which participating member cities may elect, by ordinance, to provide group -term life insurance coverage for their active members, including or not including retirees. Employers may terminate coverage under and discontinue participation in the SDBF by adopting an ordinance before November 1 of any year to be effective the following January 1. The Town has elected to participate in the SDBF for its active members including retirees. As the SDBF covers both active and retiree participants, with no segregation of assets, the SDBF is considered to be an unfunded single -employer OPEB plan (i.e. no assets are accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No. 75) for Town reporting. TMRS-SDBF Benefits Provided 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 preceding the month of death). The death benefit for retirees is considered an other postemployment benefit ("OPEB") and is a fixed amount of $7,500. At the December 31, 2020 valuation and measurement date, the following employees were covered by the benefit terms: Inactive employees currently receiving benefits 11 Inactive employees entitled to but not yet receiving benefits 4 Active employees 46 m 78 Town of Westlake Notes to the Financial Statements TMRS-SDBF Contributions The member 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. 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. Contributions are made monthly based on the covered payroll of employee members of the participating member city. The contractually required contribution rate is determined annually for each Town. The rate is based on the mortality and service experience of all employees covered by the SDBF and the demographics specific to the workforce of the city. There is a one-year delay between the actuarial valuation that serves as the basis for the employer contribution rate and the calendar yearwhen the rate goes into effect. The funding policy of this plan is to assure that adequate resources are available to meet all death benefit payments for the upcoming year. The retiree portion of contribution rates to the SDBF for the Town was 0.01 % in calendar years 2020 and 2021. The Town's contributions to the SDBF for the year ended September 30, 2021 were $5,899, and were equal to the required contributions. TMRS-SDBF Total OPEB Liability The Town's Total OPEB Liability (TOL) was measured as of December 31, 2020 and was determined by an actuarial valuation as of that date. TMRS-SDBF Actuarial Assumptions The Total OPEB Liability in the December 31, 2020 actuarial valuation was determined using the following actuarial assumptions: Inflation 2.50% Salary increases 3.50% to 11.50% including inflation Discount rate 2.00% Retiree's share of benefit -related costs $0 Salary increases were based on a service -related table. Salary increases were based on a service - related table. Mortality rates for post -retirement were based on the 2019 Municipal Retirees of Texas Mortality Tables. The rates are projected on a fully generational basis with scale UMP. Mortality rates for pre - retirement were based on PUB(10) mortality tables, with the Public Safety table used for males and the General Employee table used for females. The rates are projected on a fully generational basis with scale UMP. Actuarial assumptions used in the December 31, 2020 valuation were developed primarily from the actuarial investigation of the experience of TMRS over the four-year period from December 31, 2014 to December 31, 2018. They were first adopted in 2019 and first used in the December 31, 2019 actuarial valuation. The discount rate used to measure the Total OPEB Liability was 2.00% and was based on the Fidelity Index's "20-Year Municipal GO AA Index" rate as of December 31, 2020. 79 Town of Westlake Notes to the Financial Statements TMRS-SDBF Changes in Total OPEB Liability Balance at 12/31 /2019 Changes for the year: Service Cost Interest on Total OPEB Liability Change of benefit terms Difference between expected and actual experience Changes of assumptions or other inputs Benefit payments Administrative expense Other changes Net changes Balance at 12/31/20 Total OPEB Liability $ 82,590 8,934 2,388 (80) 15,184 (425) 26,001 $ 108,591 Total OPEB Liability as a Percentage of Covered Payroll is 2.55%. TMRS-SDBF Sensitivity of the Total OPEB Liability to Changes in the Discount Rate The following presents the total OPEB liability of the Town, calculated using the discount rate of 2.00%, as well as what the Town's total OPEB liability would be if it were calculated using a discount rate that is 1 percentage -point lower (1.00%) or 1 percentage -point higher (3.00%) than the current rate: 1 % Decrease 1 % Increase in Discount Discount in Discount Total OPEB Liability $ 134,366 $ 108,591 $ 88,768 :E Town of Westlake Notes to the Financial Statements TMRS-SDBF OPEB Expense and Deferred Oufflows of Resources and Deferred Inflows of Resources Related to OPEB For the year ended September 30, 2021, the Town recognized OPEB expense of $15,709. At September 30, 2021, the Town reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Changes in expected and actual experience Changes in assumptions and other inputs Contributions subsequent to the measurement date Total Deferred Deferred Outflows of Inflows of Resources Resources $ 2,833 $ 1,331 26,655 2,751 3,541 $ 33,029 $ 4,082 The $3,541 reported as deferred outflows of resources related to OPEB resulting from contributions subsequent to the measurement date will reduce the Total OPEB liability during the year ending September 30, 2022. The other amounts reported as deferred outflows and inflows of resources related to OPEB will be recognized in OPEB expense as follows: Fiscal Year Ended Net Deferred Sept. 30, Outflows (Inflows) 2022 $ 4,387 2023 4,387 2024 4,387 2025 3,987 2026 4,290 Thereafter 3,968 Total $ 25,406 TRS-Care Health Care Coverage During the period ended August 31, 2021, employees of the Academy (a blended component unit of the Town) who met minimum eligibility requirements were covered by a state-wide health care plan, TRS Active Care. The Academy's participation in this plan is renewed annually. The Academy paid into the Plan $397 per month per employee and $322 per month when the employee works less than 30 hours per week if eligible to enroll in TRS Active Care. Employees, at their option, pay premiums for any coverage above these amounts as well as for dependent coverage. The Teacher Retirement System (TRS) manages TRS Active Care. The medical plan is administered by Aetna, and Caremark Health administers the prescription drug plan. The latest financial information on the state-wide plan may be obtained by writing to the TRS Communications Department, 1000 Red River Street, Austin, Texas 78701, by calling the TRS Communications Department at 1-800-223-8778, or by downloading the report from the TRS Internet website, www.trs.state.tx.us, under the TRS Publications heading. EMI Town of Westlake Notes to the Financial Statements TRS-Care Defined Other Post Employment Benefit Plan TRS-Care Plan Description The Academy participates in the Texas Public School Retired Employees Group Insurance Program (TRS-Care). It is a multiple -employer, cost -sharing defined Other Post -Employment Benefit (OPEB) plan that has a special funding situation. The plan is administered through a trust by the Teacher Retirement System of Texas (TRS) Board of Trustees. It is established and administered in accordance with the Texas Insurance Code, Chapter 1575. TRS-Care Plan Fiduciary Net Position Detail information about the TRS-Care's fiduciary net position is available in the separately issued TRS Annual Comprehensive Financial Report that includes financial statements and required supplementary information. That report may be obtained on the Internet at https://www.trs.texas.gov/Pages/about_archive_cafr.aspx; by writing to TRS at 1000 Red River Street, Austin, TX, 78701-2698; or by calling (512) 542-6592. TRS-Care Benefits Provided TRS-Care provides a basic health insurance coverage (TRS-Care 1), at no cost to all retirees from public schools, charter schools, regional education service centers and other educational academies who are members of the TRS pension plan. Optional dependent coverage is available for an additional fee. Eligible retirees and their dependents not enrolled in Medicare may pay premiums to participate in one of two optional insurance plans with more comprehensive benefits (TRS-Care 2 and TRS-Care 3). Eligible retirees and dependents enrolled in Medicare may elect to participate in one of the two Medicare health plans for an additional fee. To qualify for TRS-Care coverage, a retiree must have at least 10 years of service credit in the TRS pension system. The Board of Trustees is granted the authority to establish basic and optional group insurance coverage for participants as well as to amend benefit terms as needed under Chapter 1575.052. There are no automatic post -employment benefit changes; including automatic COLAs. The premium rates for the optional health insurance are based on years of service of the member. The schedule below shows the monthly rates for the average retiree with and without Medicare coverage. TRS-Care Plan Premium Rates Plan Year 2020 TRS-Care 2 Medicare Non -Medicare Retiree* $ 135 Retiree and spouse 529 Retiree* and children 468 Retiree and family 1,020 * or surviving spouse $ 200 689 408 999 82 Town of Westlake Notes to the Financial Statements TRS-Care Contributions Contribution rates for the TRS-Care plan are established in state statute by the Texas Legislature, and there is no continuing obligation to provide benefits beyond each fiscal year. The TRS-Care plan is currently funded on a pay-as-you-go basis and is subject to change based on available funding. Funding for TRS- Care is provided by retiree premium contributions and contributions from the state, active employees, and Academy based upon Academy payroll. The TRS Board of Trustees does not have the authority to set or amend contribution rates. Texas Insurance Code, Section 1575.202 establishes the state's contribution rate which is 1.25% of the employee's salary. Section 1575.203 establishes the active employee's rate which is .65% of pay. Section 1575.204 establishes an employer contribution rate of not less than 0.25 percent or not more than 0.75 percent of the salary of each active employee of the public. The actual employer contribution rate is prescribed by the Legislature in the General Appropriations Act. The following table shows contributions to the TRS-Care plan by type of contributor. 2020 2021 Active employee 0.65% 0.65% Non -employer contribution entity (state) 1.25% 1.25% Employers/District 0.75% 0.75% Federal/private funding remitted by Employers 1.25% 1.25% The contribution amounts for the Academy's fiscal year 2021 are as follows: 2021 Employer contributions $ 46,994 2021 Member contributions 39,665 2020 Plan year NECE on -behalf contributions (state) 62,186 In addition, the State of Texas contributed $26,729, $24,620, and $20,423 in 2021, 2020, and 2019, respectively, for on -behalf payments for Medicare Part D. In addition to the employer contributions listed above, there is an additional surcharge all TRS employers are subject to (regardless of whether or not they participate in the TRS Care OPEB program). When employers hire a TRS retiree, they are required to pay to TRS Care, a monthly surcharge of $535 per retiree. TRS-Care Actuarial Assumptions The actuarial valuation of the total OPEB liability was performed as of August 31, 2019. Updated procedures were used to roll forward the total OPEB liability to August 31, 2020. The actuarial valuation of the OPEB plan offered through TRS-Care is similar to the actuarial valuation performed for the pension plan, except that the OPEB valuation is more complex. The following assumptions used for the valuation of the TRS-Care OPEB liability are identical to the assumptions employed in the August 31, 2020 TRS annual pension actuarial valuation: Demoaraohic Assumptions Rates of mortality Rates of retirement Rates of termination Rates of disability Economic Assumptions General inflation Wage inflation Salary increase 83 Town of Westlake Notes to the Financial Statements The demographic assumptions were developed in the experience study performed for TRS for the period ending August 31, 2017. Valuation date Actuarial cost method I nflation Discount Rate Aging factors Election rates Expenses Healthcare trend rates Ad -hoc employment benefit changes TRS-Care Discount Rate August 31, 2019, rolled forward to August 31, 2020 Individual entry age normal 2.30% 2.33%. Source from fixed income municipal bonds with 20 years to maturity that include only federal tax-exempt municipal bonds as reported in Fidelity I ndex's "20-Year Municipal GO AA I ndex" as of August 31, 2020. Based on plan specific experience Normal retirement; 65% participation prior to age 65 and 40% after age 65.25% of pre-65 retirees are assumed to discontinue coverage at age 65. Third -party administrative expenses related to the delivery of health care benefits are included in the age -adjusted claims costs. 9.00% for Medicare retirees and 7.30% for non -Medicare retirees. The initial trend rates decrease to an ultimate trend rate of 4.25% over a period of 13 years. None A single discount rate of 2.33% was used to measure the total OPEB liability at August 31, 2020. There was a decrease of 0.30% in the discount rate since the August 31, 2019 measurement date. The plan is essentially a "pay-as-you-go" plan, and based on the assumption that contributions are made at the statutorily required rates, the OPEB plan's fiduciary net position was projected to not be able to make all future benefit payments to current members and therefore, the single discount rate is equal to the prevailing municipal bond rate. The source for the rate is the Fixed Income Market Data / Yield Curve / Data Municipal Bonds with 20 years to maturity that include only federally tax-exempt municipal bonds as reported in Fidelity Index's "20-Year Municipal GO AA Index". TRS-Care Discount Rate Sensitivity Analysis. The following schedule shows the impact of the Net OPEB Liability if the discount rate used was 1% less than and 1% greater than the discount rate that was used (2.33%) in measuring the Net OPEB Liability. Academy's proportionate share of the net OPEB liability 1% Decrease in Discount 1% Increase in Discount Rate Rate Discount Rate (1.33%) (2.33%) (3.33%) $ 2,777,480 $ 2,314,571 $ 1,948,940 84 Town of Westlake Notes to the Financial Statements TRS-Care Healthcare Cost Trend Rates Sensitivity Analysis. The following presents the net OPEB liability of the plan using the assumed healthcare cost trend rate, as well as what the net OPEB liability would be if it were calculated using a trend rate that is one -percentage point lower or one -percentage point higher than the assumed healthcare cost trend rate. 1 % Decrease in Trend 1 % Increase in Rate Rate Discount Rate Academy's proportionate share of the net OPEB liability $ 1,890,708 $ 2,314,571 $ 2,879,097 TRS-Care OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEBs. At August 31, 2021, the Academy reported a liability of $2,314,571 for its proportionate share of TRS's Net OPEB Liability. This liability reflects a reduction for State OPEB support provided to the Academy. The amount recognized by the Academy as its proportionate share of the net OPEB liability, the related State support, and the total portion of the net OPEB liability that was associated with the Academy were as follows: Academy's proportionate share of the collective net OPEB liability $ 2,314,571 State's proportionate share that is associated with Academy 3,110,229 Total 5,424,800 The Net OPEB Liability was measured as of August 31, 2020 and the Total OPEB Liability used to calculate the Net OPEB Liability was determined by an actuarial valuation as of August 31, 2019 rolled forward to August 31, 2020. The employer's proportion of the Net OPEB Liability was based on the employer's contributions to the OPEB plan relative to the contributions of all employers to the plan for the period September 1, 2019 thru August 31, 2020. At August 31, 2020 the employer's proportion of the collective Net OPEB Liability was .0060886508% which was an increase of .0001029369% the same proportion measured as of August 31, 2019. TRS-Care Changes Since the Prior Actuarial Valuation. The following were changes to the actuarial assumptions or other inputs that affected measurement of the Total OPEB liability since the prior measurement period. • The discount rate changed from 2.63% as of August 31, 2019 to 2.33% as of August 31, 2020. This change increased the total OPEB liability. The ultimate health care trend assumption was lowered from 4.50% to 4.25% as a result of Congress' repeal of the excise (Cadillac) tax on high -cost employer health plans in December 2019. These changes decreased the total OPEB liability. • The participation rate for pre-65 retirees was lowered from 50% to 40%. This change decreased the total OPEB liability. For the year ended August 31, 2021, the Academy recognized OPEB expense of ($39,985) and revenue of ($21,596) for support provided by the State. 85 Town of Westlake Notes to the Financial Statements At August 31, 2021, the Academy reported its proportionate share of the TRS's deferred outflows of resources and deferred inflows of resources related to other post -employment benefits from the following sources: Deferred Deferred Outflows Inflows of Resources of Resources Differences between expected and actual economic experience $ 121,190 $ 1,059,266 Changes in actuarial assumptions 142,761 635,593 Difference between projected and actual investment earnings 752 - Changes in proportion and difference between the employer's contributions and the proportionate share of contributions 105,248 - Contributions paid to TRS subsequent to the measurement date 46,994 - Total $ 416,945 $ 1,694,859 The $46,994 deferred outflow of resources resulting from Academy contributions subsequent to the measurement date will be recognized as a reduction of the net OPEB liability in the year ended August 31, 2022. The net amounts of the remaining balances of deferred outflows and inflows of resources related to OPEB will be recognized in OPEB expense as follows: Year Ended August 31, OPEB Expense (I ncome) Amount 2022 $ (224,204) 2023 (224,304) 2024 (224,364) 2025 (224,348) 2026 (162,524) Thereafter (265,164) Total $ (1,324,908) Note 13. Risk Management The Town is exposed to various risks of loss related to torts, theft of, damage to, and destruction of assets; errors and omissions; injuries to employees, and natural disasters. The Town's general liability, workers' compensation liability, law enforcement liability, errors and omissions liability, and automobile liability coverage is insured by the Texas Municipal League, a public entity risk pool. The Town's only responsibility to the Texas Municipal League is to pay premiums for insurance and related deductible amounts of these policies. Other risk of loss is covered by commercial insurance. Settlements of claims have not exceeded coverage in the past three years. Town of Westlake Notes to the Financial Statements Note 14. Contingent Liabilities Litigation Various claims and lawsuits are pending against the Town. In the opinion of Town management, after consultation with legal counsel, the potential loss on these claims and lawsuits will not materially affect the Town's financial position. Circle T Municipal Utility Districts The Town and Hillwood are currently in discussions regarding the debt for Municipal Utility District's (MUDS) #1 and #3 on the Circle T property in Westlake which is controlled by AIL Investments, L.P. As this property develops, Hillwood agreed to de -annex developed property from the MUDs in exchange for pro-rata payments on water and sewer infrastructure installed by the MUDs at their inception. To date, three projects, Lexington TNI, Deloitte University, and Charles Schwab, have been or are being developed within these MUDs. Discussions regarding the Town's payment to AIL Investments, L.P. in exchange for de -annexation of these three tracks from the Circle T MUDs have taken place but have not come to a conclusion as to the settlement amounts. These discussions are ongoing until the Town receives full documentation that it determines is adequate to support the requested payments. The Town of Westlake holds full rights and privileges under the State granted Certificate of Convenience and Necessity (CCN) and can serve all water and sewer customers within these MUD boundaries regardless of the status of these negotiations. Note 15. Solana Public Improvement District On February 24, 2014, the Town Council granted a petition by Maguire Partners -Solana Land, LP in resolution 14-07 to authorize and provide for the creation of a public improvement district, The Solana Public Improvement District ("the District"). The District encompasses approximately 85 acres currently being developed as a master -planned mixed -use development known as "Westlake Entrada" that is expected to include, among other things, condominiums, residential villas, hotels, office, retail, commercial, institutional and hospitality uses, and a wedding event center. The District was created in accordance with Chapter 372 of the Texas Local Government Code. On February 5, 2015, the Town Council approved issuance of $26,175,000 of Special Assessment Revenue Bonds, Series 2015 related to the District. The Public Improvement District Bonds (The Bonds) are special and limited obligations of the Town payable solely from the pledged revenues and other funds comprising the Trust Estate, as and to the extent provided in the indenture. The bonds do not give rise to a charge against the general credit or taxing power of the Town and are payable solely from the sources identified in the indenture. The owners of the bonds shall never have the right to demand payment thereof out of money raised or to be raised by taxation, or out of any funds of the Town other than the Trust Estate, as and to the extent provided in the indenture; and, no owner of the bonds shall have the right to demand any exercise of the Town's taxing power to pay the principal of the bonds or the interest or redemption premium, if any, thereon. The Town shall have no legal or moral obligation to pay the bonds out of any funds of the Town other than the Trust Estate in accordance with the Texas Local Government Code. The proceeds from the bond issue are being used as follows: payment of a portion of the costs of construction, acquisition, or purchase of certain water, wastewater and roadway public improvements for the special benefit of the District; funding a reserve fund; funding capitalized interest; payment of a portion of the costs incidental to the organization of the District; and payment of the cost of issuance of the bonds. The Town is not, and will not be obligated to provide any funds to finance construction of authorized improvements. All design and construction costs of the District's authorized public improvements will be paid from the District assessments and from other sources of funds, if any, to the extent provided in the Trust Indenture. 87 Town of Westlake Notes to the Financial Statements Note 16. Tax Abatements The Town enters into economic development agreements authorized under Chapter 380 of the Texas Local Government Code and Chapter 312 of the Texas Tax Code. These agreements are planning tools designed to stimulate economic activity, redevelopment, community improvement, and provide a return on investment for the community. These programs abate or rebate property and/or sales and hotel/motel taxes and may include other incentive payments such as fee reductions or construction costs reimbursements. Economic development agreements are considered on a case -by -case basis by the Town Council and generally contain recapture provisions, which may require repayment or termination if recipients do not meet the required provisions of the economic incentives. Other Economic Agreements Chapter 380 of the Texas Local Government Code allows the Town to provide grants for the purpose of promoting local economic development. These grants are based on a percentage of property and/or sales tax received by the Town. For the fiscal year ending September 30, 2021, the Town abated $594,163 in property taxes. Note 17. Going Concern The 2021 financial statements were prepared assuming the Texas Student Housing entities will continue as going concerns. The Texas Student Housing entities' bonds payable are considered to be in default due to not making full principal and interest payments and, therefore, are reported as current liabilities. This is considered an event of default by the Trustees, which gives the bondholders the right to accelerate and demand payment of the bonds in full. Management and the property managers are in the process of developing and implementing plans to increase occupancy and rental rates at the properties to improve their financial performance. Note 18. Subsequent Events The Town has evaluated all events or transactions that occurred after September 30, 2021 up through May 17, 2022, the date the financial statements were issued. During this period, there were no material subsequent events that required recognition or additional disclosure in these financial statements, except as follows: Bond Issuance On February 15, 2022, the Town issued $14,920,000 of General Obligation Refunding Bonds, Series 2022. These bonds were issued to refund the contractual obligations owed by the Town's Utility Fund (business - type activities) consisting of $4,679,944 of principal and accrued interest of $1 1,001,089. These bonds have an interest rate of 4.0% and will mature in 2030. Note 19. GASB Pronouncements Implemented by the Town GASB Statement No. 84, Fiduciary Activities. This Statement was issued in January 2017 and provides guidance to enhance the consistency and comparability of fiduciary activity reporting by (1) establishing specific criteria for identifying activities that should be reported as fiduciary activities and (2) clarifying whether and how business -type activities should report their fiduciary activities. Beginning net position of the PID Custodial Fund was restated by $4,048,673, and beginning net position of the governmental activities and beginning fund balance of the Westlake Academy Fund (major special revenue) were restated by $56,123 as a result of the implementation of this pronouncement. :: Required Supplementary Information EMI T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN .s Town of Westlake Schedule of Revenues, Expenditures, and Changes in Fund Balances Budget and Actual - General Fund For the Year Ended September 30, 2021 Exhibit B-1 General Fund Variance Budgeted Amounts Favorable Original Amended Actual (Unfavorable) REVENUES Taxes Sales $ 3,166,125 $ 4,500,000 $ 4,779,274 $ 279,274 Property 1,837,577 2,003,360 2,017,446 14,086 Mixed beverages 40,000 40,000 23,269 (16,731) Franchise 942,125 942,125 735,263 (206,862) Interest income 96,300 36,300 26,664 (9,636) Building permits and fees 2,691,217 2,367,185 2,612,098 244,913 Fines and penalties 475,600 517,918 582,854 64,936 Intergovernmental 285,325 25,000 25,000 - Contributions - 300,000 300,000 Miscellaneous 25,905 256,405 91,890 (164,515) Total revenues 9,560,174 10,988,293 11,193,758 205,465 EXPENDITURES Current General government 5,384,425 5,335,425 5,052,010 283,415 Public safety 3,971,557 3,633,232 3,546,694 86,538 Cultural and recreation 318,273 280,273 182,253 98,020 Public works 762,095 720,095 601,562 118,533 Debt service Principal retirement 36,680 36,680 36,677 3 Total expenditures 10,473,030 10,005,705 9,419,196 586,509 Excess of revenues over expenditures (912,856) 982,588 1,774,562 791,974 OTHER FINANCING SOURCES (USES) Transfers in 68,000 192,588 205,014 12,426 Transfers out (966,816) (449,876) (357,169) 92,707 Net other financing sources (uses) (898,816) (257,288) (152,155) 105,133 NET CHANGE IN FUND BALANCE (1,811,672) 725,300 1,622,407 897,107 FUND BALANCE AT BEGINNING OF YEAR 16,590,510 16,590,510 16,590,510 - FUND BALANCE AT END OF YEAR $ 14,778,838 $ 17,315,810 $ 18,212,917 $ 897,107 M Town of Westlake Exhibit B-2 Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual - Westlake Academy For the Year Ended August 31, 2021 Westlake Academy Variance Budgeted Amounts Favorable Original Final Actual (Unfavorable) REVENUES State program revenues $ 8,302,843 $ 8,405,664 $ 8,457,552 $ 51,888 Federal program revenues 115,421 121,678 121,678 - Interest income 10,000 5,000 2,422 (2,578) Local and intermediate sources 1,269,135 1,422,792 1,420,977 (1,815) Total revenues 9,697,399 9,955,134 10,002,629 47,495 EXPENDITURES Education 9,668,876 9,699,347 9,557,739 141,608 Debt service 207,922 207,922 207,922 - Total expenditures 9,876,798 9,907,269 9,765,661 141,608 Excess (deficiency) of revenues over (under) expenditures (179,399) 47,865 236,968 189,103 NET CHANGE IN FUND BALANCE (179,399) 47,865 236,968 189,103 FUND BALANCE AT BEGINNING OF YEAR 1,761,287 1,761,287 1,761,287 - Cumulative effect of change in accounting principle - - 56,123 56,123 FUND BALANCE AT END OF YEAR $ 1,581,888 $ 1,809,152 $ 2,054,378 $ 245,226 92 Town of Westlake Notes to Budgetary Comparison Schedules Budgetary Information - The Town follows these procedures annually in establishing the budgetary data reflected in the budgetary comparison schedules: The Town Manager submits to the Town Council a proposed budget for the fiscal year commencing the following October 1. The budget includes proposed expenditures and the means of financing them. 2. Prior to October 1, the budget is legally adopted through passage of an ordinance. This budget is reported as the Original Budget in the budgetary comparison schedules. 3. During the fiscal year, changes to the adopted budget may be authorized, as follows: a. Items requiring Town Council action - appropriation of fund balance reserves; transfers of appropriations between funds; new inter -fund loans or advances; and creation of new capital projects or increases to existing capital projects. b. Items delegated to the Town Manager - appropriation balances from an expenditure account to another within a single fund. 4. Budget amounts are reflected after all authorized amendments and revisions. This budget is reported as the Final Budget in the budgetary comparison schedules. 5. The appropriated budget is prepared by fund, function and department. The Town's management may make transfers of appropriations within a fund. Transfers of appropriations between funds require the approval of the Town Council. The legal level of budgetary control is the fund level. The Town Council made several supplementary budget appropriations during the year. 6. Commitments are for goods or services in future years. Accounting under other commitments for the expenditure of resources are recorded to reserve a portion of the governmental funds. The budgeted commitments lapse at year-end and do not constitute expenditures or liabilities because the commitments must be re -appropriated, budgeted, and honored during the subsequent year. 7. Prior to August 25 of the preceding fiscal year, the Westlake Academy prepares a budget for the next succeeding fiscal year beginning September 1. The operating budget includes proposed expenditures and the means of financing them. A meeting of the Board of Trustees is then called for the purpose of adopting the proposed budget. Prior to September 1, the budget is legally enacted through resolution by the Board. Once a budget is approved, it can only be amended at the object, function and fund level by approval of a majority of the members of the Board. Amendments are presented to the Board at its regular meetings. Each amendment made before the fact, is reflected in the official minutes of the Board, and is not made after fiscal year end. All budget appropriations lapse at year-end. 93 Town Of Westlake Schedule of Net Pension Liability and Related Ratios Texas Municipal Retirement System Pension Plan Last Seven Measurement Years Total pension liability Exhibit B-3 Service cost $ 683,693 $ 651,255 $ 605,453 $ 566,643 $ 493,414 $ 435,146 $ 288,923 Interest 660,928 570,598 493,022 439,725 371,753 317,982 264,994 Change in benefit terms - - - - - - - Difference between expected and actual experience (5,405) 131,635 126,691 (120,557) 212,434 96,226 176,965 Change in assumptions 89,534 - - 139,579 - Benefit payments (129,398) (112,642) (84,942) (146,316) (58,144) (38,289) (55,762) Net change in total pension liability 1,209,818 1,330,380 1,140,224 739,495 1,009,457 950,644 675,120 Total pension liability, beginning 9,514,373 8,183,993 7,043,769 6,304,274 5,294,817 4,344,173 3,669,053 Total pension liability, ending 10,724,191 9,514,373 8,183,993 7,043,769 6,304,274 5,294,817 4,344,173 Plan fiduciary net position Contributions, employer 500,613 470,903 472,011 400,684 330,604 290,278 172,064 Contributions, nonemployer 297,813 279,349 257,327 232,776 203,359 188,725 152,077 Net investment income 615,040 999,440 (179,608) 670,195 276,056 5,368 182,430 Benefit payments (129,398) (112,642) (84,942) (146,316) (58,144) (38,289) (55,762) Administrative income (3,966) (5,628) (3,463) (3,468) (3,113) (3,268) (1,904) Other (155) (169) (181) (176) (168) (191) (127) Net change in plan fiduciary net position 1,279,947 1,631,253 461,144 1,153,695 748,594 442,623 448,778 Plan fiduciary net position, beginning 8,073,885 6,442,632 5,981,488 4,827,793 4,079,199 3,636,576 3,187,798 Plan fiduciary net position, ending 9,353,832 8,073,885 6,442,632 5,981,488 4,827,793 4,079,199 3,636,576 Town's net pension liability, ending $ 1,370,359 $ 1,440,488 $ 1,741,361 $ 1,062,281 $ 1,476,481 $ 1,215,618 $ 707,597 Plan fiduciary net position as a % of total pension liability 87.22% 84.86% 78.727. 84.927. 76.587. 77.047o 83.71% Covered payroll $ 4,254,465 $ 3,961,404 $ 3,676,095 $ 3,325,369 $ 2,905,134 $ 2,696,072 $ 2,172,525 Town's net pension liability as a % of payroll 32.21% 36.36% 47.377. 31.94% 50.827. 45.09% 32.57% Note: Only seven years of data is presented in accordance with GASB #68, paragraph 138. "The information for all period for the 10-year schedules that are required to be presented as required supplementary information may not be available initially. In these cases, during the transition period, that information should be presented for as many periods as are available. The schedules should not include information that is not measured in accordance with the requirements of this statement. Additional years' information will be displayed as it becomes available." 94 Town of Westlake Schedule of Pension Contributions Texas Municipal Retirement System Pension Plan Last Seven Fiscal Years Exhibit B-4 2021 2020 2019 2018 2017 2016 2015 Actuarially determined contributions $ 524,995 $ 478,059 $ 473,030 $ 454,421 $ 419,720 $ 316,618 $ 277,651 Contributions in relation to the actuarially determined contributions (524,995) (478,059) (473,030) (454,421) (419,720) (316,618) (277,651) Contribution deficiency (excess) $ - $ - $ - $ - $ - $ - $ - Covered payroll 4,460,447 4,058,942 3,920,565 3,676,094 3,325,369 2,821,349 2,778,776 Contributions as a percentage of covered payroll 11.777. 11.787. 12.077. 12.367. 12.627. 11.227. 9.99% Note: GASB #68, paragraph 81.2.b requires that the data in this schedule be presented as of the Town's fiscal year as opposed to the time period covered by the measurement date. Note: Only seven years of data is presented in accordance with GASB #68, paragraph 138. "The information for all period for the 10-year schedules that are required to be presented as required supplementary information may not be available initially. In these cases, during the transition period, that information should be presented for as many periods as are available. The schedules should not include information that is not measured in accordance with the requirements of this statement. Additional years' information will be displayed as it becomes available." 95 Town of Westlake Exhibit B-5 Schedule of Academy's Proportionate Share of Net Pension Liability - Teacher Retirement System Pension Plan Last Seven Measurement Years 2020 2019 2018 2017 2016 2015 2014 Academy's proportion of the net pension liability 0.0055779% 0.00289127. 0.0027061% 0.00280127. 0.00278227. 0.00309457. 0.0007190% Academy's proportionate share of net pension liability $ 2,987,427 $ 1,502,914 $ 1,489,525 $ 895,663 $ 1,051,346 $ 1,093,865 $ 192,056 State's proportionate share of net pension liability associated with the Westlake Academy 4,112,478 5,272,547 5,571,598 3,480,057 4,035,754 3,667,893 2,965,583 Total $ 7,099,905 $ 6,775,461 $ 7,061,123 $ 4,375,720 $ 5,087,100 $ 4,761,758 $ 3,157,639 Academy's covered payroll $ 5,984,542 $ 5,534,431 $ 5,289,916 $ 5,391,515 $ 5,094,571 $ 4,784,695 $ 4,300,931 Academy's proportionate share of net pension liability as a percentage of its covered payroll 49.927. 27.167. 28.167. 16.61% 20.64% 22.867. 4.477. Plan fiduciary net position as a percentage of total pension liability 75.547. 75.247. 73.747. 82.17% 78.007. 78.437. 83.25% Note: Only seven years of data is presented in accordance with GASB #68, paragraph 138. "The information for all periods for the 10-year schedules that are required to be presented as required supplementary information may not be available initially. In these cases, during the transition period, that information should be presented for as many years as are available. The schedules should not include information that is not measured in accordance with the requirements of this Statement." Town of Westlake Schedule of Pension Contributions Teacher Retirement System Pension Plan Last Seven Fiscal Years (Unaudited) Exhibit B-6 2021 2020 2019 2018 2017 2016 2015 Statutorily required contributions $ 222,306 $ 230,148 $ 100,311 $ 91,593 $ 131,436 $ 88,399 $ 92,325 Actual contributions in relation to statutorily required contributions (222,306) (230,148) (100,311) (91,593) 131,436 88,399 92,325 Contribution deficiency (excess) $ - $ - $ - $ - $ - $ - $ - Academy's covered payroll $ 6,119,043 $ 5,984,542 $ 5,534,431 $ 5,289,916 $ 5,391,515 $ 5,094,571 $ 4,784,694 Contributions as a percentage of Academy's covered payroll 3.63% 3.857o 1.81% 1.737o 2.44% 1.747o 1.937o Note: GASB 68, Paragraph 81.2.b requires that the data in this schedule be presented as of the Academy's current fiscal year as opposed to the time period covered by the measurement date. Note: Only seven years of data is presented in accordance with GASB #68, paragraph 138. "The information for all periods for the ten-year schedules that are required to be presented as required supplementary information may not be available initially. In these cases, during the transition period, that information should be presented for as many years as are available. The schedules should not include information that is not measured in accordance with the requirements of this Statement." 97 Town of Westlake Exhibit B-7 Schedule of Changes in the Total OPEB Liability and Related Ratios Texas Municipal Retirement System OPEB Plan Last Four Measurement Years (Unaudited) 2020 2019 2018 2017 Total OPEB liability Service cost $ 8,934 $ 7,131 $ 7,720 $ 6,318 Interest 2,388 2,146 1,844 1,603 Change in benefit terms - - - - Difference between expected and actual experience (80) 3,831 (2,126) - Change in assumptions 15,184 15,394 (4,632) 4,872 Benefit payments (425) (396) (5,184) 4,816 Net change in total OPEB liability 26,001 28,106 (2,378) 17,609 Total OPEB liability, beginning 82,590 54,484 56,862 39,253 Total OPEB liability, ending $ 108,591 $ 82,590 $ 54,484 $ 56,862 Employee covered payroll $ 4,254,465 $ 3,961,404 $ 3,676,094 $ 3,325,369 Total OPEB liability as a % of employee covered payroll 2.55% 2.08% 1.48% 1.71% Note: Only four years of data is presented in accordance with GASB #75. Additional years' information will be displayed as it becomes available. The TMRS Supplementary Death Benefit Fund (SDBF) is considered to be an unfunded OPEB plan; therefore, no plan fiduciary net position and related ratios are reported in the above schedule. Town of Westlake Schedule of OPEB Contributions Texas Municipal Retirement System OPEB Plan Last Four Fiscal Years (Unaudited) Exhibit B-8 2021 2020 2019 2018 Actuarially determined contributions $ 5,899 $ 7,712 $ 7,349 $ 6,380 Contributions in relation to the actuarially determined contributions (5,899) (7,712) (7,349) (6,380) Contribution deficiency (excess) $ - $ - $ - $ Covered employee payroll $ 4,460,447 $ 4,058,942 $ 3,920,565 $ 3,676,094 Contributions as a percentage of covered employee payroll 0.13% 0.19% 0.19% 0.17% Note: GASB #75, paragraph 57 requires that the data in this schedule be presented as of the Town's fiscal year as opposed to the time period covered by the measurement date. Only four years of data is presented in accordance with GASB #75. Additional years' information will be displayed as it becomes available. The TMRS Supplementary Death Benefit Fund (SDBF) is considered to be an unfunded OPEB plan; therefore, no plan fiduciary net position and related ratios are reported in the above schedule. Town of Westlake Exhibit B-9 Schedule of Academy's Proportionate Share of the Net OPEB Liability and Related Ratios Teacher Retirement System TRS Care Plan Last Four Measurement Years (Unaudited) Academy's proportion of the net OPEB liability 0.006088651% 0.0059857139% 0.005909347o 0.0058830418% Academy's proportionate share of net OPEB liability $ 2,314,571 $ 2,830,719 $ 2,950,588 $ 2,558,314 State's proportionate share of net OPEB liability associated with the Westlake Academy 3,110,229 3,761,390 4,695,104 4,406,333 Total $ 5,424,800 $ 6,592,109 $ 7,645,692 $ 6,964,647 Academy's covered payroll $ 5,984,542 $ 5,534,431 $ 5,289,916 $ 5,391,515 Academy's proportionate share of net OPEB liability as a percentage of its covered payroll 38.68% 51.15% 55.78% 47.45% Plan fiduciary net position as a percentage of total OPEB liability 4.99% 2.66% 1.577o 0.91% Note: Only four years of data is presented in accordance with GASB #75. "The information for all periods for the 10-year schedules that are required to be presented as required supplementary information may not be available initially. In these cases, during the transition period, that information should be presented for as many years as are available. The schedules should not include information that is not measured in accordance with the requirements of this Statement:' No] Town of Westlake Schedule of Academy's OPEB Contributions Teacher Retirement System TRS Care Plan Last Four Fiscal Years (Unaudited) Exhibit B-10 2021 2020 2019 2018 Statutorily required contributions $ 46,994 $ 46,278 $ 46,703 $ 46,204 Actual contributions in relation to statutorily required contributions (46,994) (46,278) (46,703) (46,204) Contribution deficiency (excess) $ - $ - $ - $ - Academy's covered payroll $ 6,102,222 $ 5,984,542 $ 5,534,431 $ 5,289,916 Contributions as a percentage of Academy's covered payroll 0.77% 0.77% 0.847o 0.877o Note: GASB 75 requires that the data in this schedule be presented as of the Academy's current fiscal year as opposed to the time period covered by the measurement date. Note: Only four years of data is presented in accordance with GASB #75. "The information for all periods for the 10-year schedules that are required to be presented as required supplementary information may not be available initially. In these cases, during the transition period, that information should be presented for as many years as are available. The schedules should not include information that is not measured in accordance with the requirements of this Statement." IN T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN UN Combining and Individual Fund Statements and Schedules 103 Town of Westlake Schedule of Revenues, Expenditures and Changes In Fund Balances Budget and Actual - Debt Service Fund For the Year Ended September 30, 2021 REVENUES Taxes Property Total revenues EXPENDITURES Debt service Principal retirement Interest and other fiscal charges Bond issuance costs Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Refunding bonds issued Payment to refunding bond escrow agent Premium on refunding bonds issued Total other financing sources (uses) NET CHANGE IN FUND BALANCE FUND BALANCE AT BEGINNING OF YEAR FUND BALANCE AT END OF YEAR Exhibit C-1 Debt Service Fund Variance Budgeted Amounts Favorable Original Amended Actual (Unfavorable) $ 632,381 $ 699,383 $ 694,403 $ (4,980) 1,651,350 1,651,350 1,651,350 1,039,924 1,039,839 1,039,839 - - - 72,932 (72,932) 2,691,274 2,691,189 2,764,121 (72,932) (2,058,893) (1,991,806) (2,069,718) (77,912) 2,022,191 1,949,876 1,950,261 385 - - 4,430,000 4,430,000 - - (4,694,366) (4,694,366) - - 337,298 337,298 2,022,191 1,949,876 2,023,193 73,317 (36,702) (41,930) (46,525) (4,595) 150,518 150,518 150,518 - $ 113,816 $ 108,588 $ 103,993 $ (4,595) 104 Town of Westlake Nonmajor Governmental Funds Visitors Association Fund To account for municipal hotel occupancy taxes collected and expenditures to promote tourism and the convention and hotel industry. Lone Star Public Facilities Corporation Fund To account for investment activity relating to the Lone Star Public Facilities Corporation. Economic Development Fund To account for sales tax and hotel occupancy tax collected to fund activity relating to Economic Development agreements. Public Arts Fund To account for contributions restricted for public arts. 4B Economic Development Corporation Fund To account for sales tax collected to fund the activities of the 4B Economic Development Corporation. Solana Public Improvement District (PID) Capital Projects Fund To account for the acquisition or construction of capital facilities and improvements relating to the Solana public improvement district. Westlake Academy Expansion Capital Projects Fund To account for proceeds from long-term financing and revenue and expenditures related to authorized construction related to the expansion of Westlake Academy facilities. Town of Westlake Combining Balance Sheet Non Major Governmental Funds September 30, 2021 Exhibit C-2 Special Revenue Funds Lone Star Westlake Public 4B Economic Solana PID Academy Total Visitors Facilities Economic Development Capital Expansion Nonmajor Association Corporation Development Public Arts Corporation Projects Capital Governmental Fund Fund Fund Fund Fund Fund Projects Fund Funds ASSETS Cash and cash equivalents $ 98,833 $ 14,744 $ $ 250,000 $ - $ $ 2,066,012 $ 2,429,589 Accounts receivable 38,700 - 69 - 278,846 - 317,615 Prepaid items 397 - 397 Restricted cash and investments - - 230,402 - 230,402 Total assets $ 137,930 $ 14,744 $ 69 $ 250,000 $ 278,846 $ 230,402 $ 2,066,012 $ 2,978,003 LIABILITIES AND FUND BALANCES Accounts payable $ 37,992 $ - $ $ $ 200,999 13,510 $ 252,501 Unearned revenue 1,857 - - 1,857 Due to other funds - 278,846 278,846 Total liabilities 39,849 278,846 200,999 13,510 533,204 FUND BALANCES Nonspendable: Prepaid items 397 - - 397 Restricted for: Capital items - 250,000 29,403 2,052,502 2,331,905 Tourism 97,684 - - - - 97,684 Future projects - 14,744 69 14,813 Total fund balances 98,081 14,744 69 250,000 29,403 2,052,502 2,444,799 Total liabilities and fund balances $ 137,930 $ 14,744 $ 69 $ 250,000 $ 278,846 $ 230,402 $ 2,066,012 $ 2,978,003 .4 Town of Westlake Exhibit C-3 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended September 30, 2021 Special Revenue Funds Lone Star Westlake Public 413 Economic Solana PID Academy Visitors Facilities Economic Development Capital Expansion Total Nonmajor Association Corporation Development Public Arts Corporation Projects Capital Governmental Fund Fund Fund Fund Fund Fund Projects Fund Funds REVENUES Sales taxes $ - $ $ $ $ 1,593,092 $ $ $ 1,593,092 Hotel occupancy taxes 222,868 69 - 222,937 1 nterest income 294 25 4,584 4,903 Contributions - 150,000 50,000 200,000 Total revenues 223,162 25 69 150,000 1,593,092 54,584 2,020,932 EXPENDITURES Current: Visitor services 448,414 - - - 448,414 Capital outlay - 14,000 14,000 Total expenditures 448,414 14,000 462,414 Excess (deficiency) of revenues over (under) expenditures (225,252) 25 69 150,000 1,593,092 40,584 1,558,518 OTHER FINANCING SOURCES Transfers out (1,593,092) (1,000,000) (2,593,092) Total other financing sources (1,593,092) (1,000,000) (2,593,092) Net change in fund balances (225,252) 25 69 150,000 - (959,416) (1,034,574) Fund balances, October 1 323,333 14,719 100,000 29,403 3,011,918 3,479,373 Fund balances, September30 $ 98,081 $ 14,744 $ 69 $ 250,000 $ $ 29,403 $ 2,052,502 $ 2,444,799 107 Town Of Westlake Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual - Visitors Association Fund For the Year Ended September 30, 2021 Visitors Association Fund Exhibit C-4 Variance Budgeted Amounts Favorable Original Amended Actual (Unfavorable) REVENUES Hotel occupancy taxes $ 378,000 $ 228,000 $ 222,868 $ (5,132) Interest income 3,500 1,000 294 (706) Miscellaneous 5,700 5,700 - (5,700) Total revenues 387,200 234,700 223,162 (11,538) EXPENDITURES Visitor services 517,241 517,241 448,414 68,827 Total expenditures 517,241 517,241 448,414 68,827 Deficiency of revenues under expenditures (130,041) (282,541) (225,252) 57,289 NET CHANGE IN FUND BALANCE (130,041) (282,541) (225,252) 57,289 FUND BALANCE AT BEGINNING OF YEAR 323,333 323,333 323,333 - FUND BALANCE AT END OF YEAR $ 193,292 $ 40,792 $ 98,081 $ 57,289 108 Town of Westlake Exhibit C-5 Schedule of Revenues, Expenditures and Changes In Fund Balances Budget and Actual - Lone Star Public Facilities Corporation Fund For the Year Ended September 30, 2021 Lone Star Public Facilities Corporation Fund Variance Budgeted Amounts Favorable Original Amended Actual (Unfavorable) REVENUES Interest income $ 50 $ 50 $ 25 $ (25) Total revenues 50 50 25 (25) NET CHANGE IN FUND BALANCE 50 50 25 (25) FUND BALANCE AT BEGINNING OF YEAR 14,719 14,719 14,719 - FUND BALANCE AT END OF YEAR $ 14,769 $ 14,769 $ 14,744 $ (25) 109 Town of Westlake Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual - Economic Development Fund For the Year Ended September 30, 2021 Economic Development Fund Exhibit C-6 Variance Budgeted Amounts Favorable Original Amended Actual (Unfavorable) REVENUES Taxes Hotel occupancy $ 28,000 $ 28,000 $ 69 $ (27,931) Total revenues 28,000 28,000 69 (27,931) EXPENDITURES Economic development 28,000 28,000 - 28,000 Total expenditures 28,000 28,000 - 28,000 Excess of revenues over expenditures - - 69 69 NET CHANGE IN FUND BALANCE - - 69 69 FUND BALANCE AT BEGINNING OF YEAR - - - - FUND BALANCE AT END OF YEAR $ - $ - $ 69 $ 69 110 Town of Westlake Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual - 4B Economic Development Corporation Fund For the Year Ended September 30, 2021 Exhibit C-7 4B Economic Development Corporation Variance Budgeted Amounts Favorable Original Amended Actual (Unfavorable) REVENUES Taxes Sales $ 1,055,375 $ 1,500,000 $ 1,593,092 $ 93,092 Total revenues 1,055,375 1,500,000 1,593,092 93,092 OTHER FINANCING USES Transfers out (1,055,375) (1,500,000) (1,593,092) (93,092) Total other financing uses (1,055,375) (1,500,000) (1,593,092) (93,092) NET CHANGE IN FUND BALANCE - - - - FUND BALANCE AT BEGINNING OF YEAR - - - - FUND BALANCE AT END OF YEAR $ - $ - $ - $ - T H E T O W N O F WESTLAKE DISTINCTIVE BY DESIGN UM Statistical Section 113 Statistical Section Unaudited This part of the Town of Westlake, Texas' annual comprehensive financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures and required supplementary information says about the Town's overall financial health. Page Financial Trends 115 - 120 These schedules contain trend information to help the reader understand how the Town's financial performance and well-being have changed over time. Revenue Capacity 121 - 125 These schedules contain information to help the reader assess the Town's most significant local revenue sources. Although sales taxes are the Town's most significant local revenue source, information about principal revenue payers is confidential under Texas statutes, and; therefore, not disclosed. Trend information about sales tax revenue is provided in Exhibit S-9. Debt Capacity 126 - 128 These schedules present information to help the reader assess the affordability of the Town's current levels of outstanding debt and the Town's ability to issue additional debt in the future. Demographic and Economic Information 129 - 131 These schedules offer demographic and economic indicators to help the reader understand the environment within which the Town's financial activities take place. Operating Information 132 - 133 These schedules contain service and infrastructure data to help the reader understand how the information in the Town's financial report relates to the services the Town provides and the activities it performs. Sources: Unless otherwise noted, the information in these schedules is derived from annual financial reports for the relevant year. 114 Town of Westlake Net Position by Component Last Ten Years Accrual Basis of Accounting - Unaudited Governmental activities: Exhibit S-1 Fiscal Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Net Investment in capital assets $ 14,866,299 $ 21,177,426 $ 32,048,991 $ 29,633,298 $ 38,299,337 $ 46,499,873 $ 47,629,452 $ 48,030,010 $ 46,633,638 $ 48,565,384 Restricted 4,726,376 4,243,239 2,284,947 17,827,177 7,489,048 2,034,916 1,077,646 3,786,893 3,653,143 2,684,375 Unrestricted 5,023,731 6,636,876 ( 910,977) 7,108,101 9,260,572 9,513,643 6,437,845 10,775,740 12,350,020 13,764,861 Total governmental activities net position 1 24,616,406 $ 32,057,541 $ 33,422,961 $ 54,568,576 $ 55,048,957 $ 58,048,432 $ 55,144,943 $ 62,592,643 $ 62,636,801 $ 65,014,620 Business -type activities: Net investment in capital assets $ 6,877,555 $ 6,601,949 $ 6,734,414 $ 6,410,547 $ 6,044,363 $ 5,583,570 $ 5,293,188 $ 4,909,471 $ 4,672,681 $ 4,230,293 Restricted - - - - - - - - 50,000 50,000 Unrestricted ( 1,636,249) ( 842,457) ( 1,272,014) ( 2,608,315) ( 4,041,360) ( 3,746,696) ( 4,685,810) ( 6,548,934) ( 6,328,176) ( 5,029,957) Total business -type activities net position $ 5,241,306 $ 5,759,492 $ 5,462,400 $ 3,802,232 $ 2,003,003 $ 1,836,874 $ 607,378 $( 1,639,463) JL 605,495) JL 749,664) Primary government: Net investment in capital assets $ 21,743,854 $ 27,779,375 $ 38,783,405 $ 36,043,845 $ 44,343,700 $ 52,083,443 $ 52,922,640 $ 52,939,481 $ 51,306,319 $ 52,795,677 Restricted 4,726,376 4,243,239 2,284,947 17,827,177 7,489,048 2,034,916 1,077,646 3,786,893 3,703,143 2,734,375 Unrestricted 3,387,482 5,794,419 ( 2,182,991) 4,499,786 5,219,212 5,766,947 1,752,035 4,226,806 6,021,844 8,734,904 Total primary government net position 129,857,712 $ 37,817,033 $ 38,885,361 158,370,808 $ 57,051,960 159,885,306 $ 55,752,321 $ 60,953,180 $ 61,031,306 $ 64,264,956 Source: Annual financial reports 115 Town of Westlake Changes in Net Position Last Ten Years Accrual Basis of Accounting - Unaudited Exhibit S-2 Fiscal Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 EXPENSES Governmental activities: General government $ 2,518,490 $ 2,606,785 $ 2,784,587 $ 3,145,716 $ 4,491,557 $ 5,716,302 $ 4,776,131 $ 6,091,403 $ 6,555,048 $ 6,101,168 Public Safety 1,883,424 1,978,803 2,190,050 2,381,437 2,737,084 3,063,003 3,133,733 3,489,071 3,991,114 4,011,699 Cultural and Recreation 111,765 113,924 123,541 129,970 187,274 217,489 184,685 299,815 282,512 182,503 Public Works 216,901 267,973 955,794 1,081,996 1,102,636 1,634,549 1,820,908 1,368,049 1,326,090 1,297,821 Economic Development 546,039 626,423 147,680 171,757 141,779 163,578 469,852 306,982 150,037 - Visitor Services 475,719 521,521 493,087 665,936 740,835 737,071 885,654 927,670 802,244 451,392 Education 6,193,560 5,803,611 7,147,411 8,598,261 9,516,287 8,566,295 6,568,453 9,523,906 9,979,674 9,972,935 Interest on long-term debt 897,573 1,031,328 998,951 1,022,201 990,413 1,401,199 1,184,818 1,131,485 1,103,925 1,141,125 Total governmental activities expenses 12,843,471 12,950,368 14,841,101 17,197,274 19,907,865 21,499,486 19,024,234 23,138,381 24,190,644 23,158,643 Business -type activities: Water and Sewer 3,098,466 3,356,466 3,690,137 4,861,529 5,519,116 4,893,075 7,049,946 7,544,125 6,407,650 5,184,455 Cemetery 6,282 5,328 7,121 7,297 7,831 8,021 9,754 10,628 21,734 8,438 Total business -type activities expenses 3,104,748 3,361,794 3,697,258 4,868,826 5,526,947 4,901,096 7,059,700 7,554,753 6,429,384 5,192,893 Total primary government program expenses $ 15,948,219 $ 16,312,162 $ 18,538,359 $ 22,066,100 $ 25,434,812 $ 26,400,582 $ 26,083,934 $ 30,693,134 $ 30,620,028 $ 28,351,536 PROGRAM REVENUES Governmental activities: Fees, fines, and charges for services: General Government $ 673,090 $ 774,909 $ 33,975 $ 110,778 $ 789,457 $ 73,180 $ 137,805 $ 91,845 $ 318,140 $ 218,922 Public Safety 142,402 182,154 848,772 887,919 932,017 783,681 782,833 984,268 649,795 724,198 Public Works 407,328 659,246 1,022,769 936,245 1,789,776 3,338,541 2,027,613 5,419,039 1,587,839 2,251,832 Education 195,059 182,220 222,270 531,090 283,077 275,759 247,721 313,741 90,123 110,327 Operating grants and contributions 5,269,841 4,907,472 6,592,642 7,615,653 7,863,168 8,047,113 7,044,597 9,166,821 9,725,263 10,240,349 Capital grants and contributions - 5,897,456 80,472 19,983,078 269,185 3,485,255 424,948 1,861,623 280,000 1,537,500 Total governmental activities program revenues 6,687,720 12,603,457 8,800,900 30,064,763 11,926,680 16,003,529 10,665,517 17,837,337 12,651,160 15,083,128 Business -type activities: Charges for services: Water and Sewer 2,934,842 3,157,332 3,428,702 3,549,775 3,968,086 4,815,635 5,794,818 5,374,118 6,410,755 6,217,154 Cemetery 4,500 5,510 7,749 13,620 11,115 9,964 29,440 30,745 67,578 25,145 Operating grants and contributions 24,423 - - - - - - - - - Capital grants and contributions - - - - - 50,000 1,271 54 - - Total business -type activities program revenues 2,963,765 3,162,842 3,436,451 3,563,395 3,979,201 4,875,599 5,825,529 5,404,917 6,478,333 6,242,299 Total primary government program revenues $ 9,651,485 $ 15,766,299 $ 12,237,351 $ 33,628,158 $ 15,905,881 $ 20,879,128 716,491,046 $ 23,242,254 $ 19,129,493 $ 21,325,427 Town of Westlake Changes in Net Position Last Ten Years Accrual Basis of Accounting - Unaudited NET (EXPENSE) REVENUES Governmental activities Business -type activities Total primary government net expense GENERAL REVENUES AND OTHER CHANGES IN NET POSITION Governmental activities: Taxes Sales Property Hotel Occupancy Mixed Beverage Franchise Investment earnings Miscellaneous Transfers Extraordinary item Special item Total governmental activities Business -type activities: Investment earnings Miscellaneous Transfers Total business -type activities Total primary government CHANGE IN NET POSITION Governmental activities Business -type activities Total primary government Source Annual financial reports Exhibit S-2 Fiscal Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 $( 6,155,751) $( 346,911) $( 6,040,201) $ 12,867,489 $( 7,981,185) $( 5,495,957) $( 8,358,717) $( 5,301,044) $( 11,539,484) $( 8,075,515) ( 140,983) ( 198,952) ( 260,807) ( 1,305,431) ( 1,547,746) ( 25,497) ( 1,234,171) ( 2,149,836) 48,949 1,049,406 ( 6,296,734) ( 545,863) ( 6,301,008) 11,562,058 ( 9,528,931) ( 5,521,454) ( 9,592,888) ( 7,450,880) ( 11,490,535) ( 7,026,109) 3,657,274 4,375,397 4,725,845 4,925,428 4,609,523 4,650,744 6,003,605 8,032,671 7,378,900 6,372,366 1,441,238 1,366,633 1,367,069 1,438,969 1,476,355 1,576,750 1,629,640 1,956,630 2,411,279 2,708,091 590,853 709,578 796,481 872,179 822,490 751,601 849,167 861,710 369,145 222,937 38,286 39,727 51,602 59,184 61,476 68,432 62,347 66,923 41,949 23,269 664,991 734,935 795,322 963,040 930,043 818,423 779,506 964,239 972,520 735,263 33,353 24,218 26,713 28,904 55,600 182,095 356,076 517,128 260,003 38,381 1,112,858 1,023,149 246,633 198,199 241,501 278,071 215,076 142,230 72,688 91,890 45,507 ( 485,591) 43,399 323,100 264,578 169,316 71,466 207,213 77,158 205,014 ( 124,346) - - - - - - - - - 67,760 - - - - - - - - - 7,527,774 7,788,046 8,053,064 8,809,003 8,461,566 8,495,432 9,966,883 12,748,744 11,583,642 10,397,211 10,077 6,552 7,114 7,083 13,095 28,684 79,961 110,208 62,177 11,439 84,780 224,995 - - - - - - - - ( 45,507) 485,591 ( 43,399) ( 323,100) ( 264,578) ( 169,316) ( 71,466) ( 207,213) ( 77,158) ( 205,014) 49,350 717,138 ( 36,285) ( 316,017) ( 251,483) ( 140,632) 8,495 ( 97,005) ( 14,981) ( 193,575) 7,577,124 8,505,184 8,016,779 8,492,986 8,210,083 8,354,800 9,975,378 12,651,739 11,568,661 10,203,636 1,372,023 7,441,135 2,012,863 21,676,492 480,381 2,999,475 1,608,166 7,447,700 44,158 2,321,696 ( 91,633) 518,186 ( 297,092) ( 1,621,448) ( 1,799,229) ( 166,129) ( 1,225,676) ( 2,246,841) 33,968 855,831 $ 1,280,390 $ 7,959,321 $ 1,715,771 $ 20,055,044 $( 1,318,848) $ 2,833,346 $ 382,490 $ 5,200,859 $ 78,126 $ 3,177,527 117 Town of Westlake Fund Balances Governmental Funds Last Ten Years Modified Accrual Basis of Accounting - Unaudited Exhibit S-3 Fiscal Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 General fund Nonspendable: Prepaid items $ 6,856 $ 6,906 $ 8,821 $ 13,334 $ 12,794 $ 18,705 $ 19,253 $ 19,302 $ 41,586 $ 38,889 Restricted for: Court security and technology 192,768 194,422 193,082 203,173 238,636 219,693 203,173 237,804 203,173 239,576 Committed for: Future projects 49,941 74,941 80,442 80,442 335,322 335,392 80,442 80,442 80,442 80,442 Assigned for: Future equipment 22,000 24,000 - - - - - - - - Unassigned 4,992,240 6,751,362 7,671,173 7,383,601 9,092,721 10,363,702 10,493,380 14,900,650 16,265,309 17,854,010 Total general fund $ 5,263,805 $ 7,051,631 $ 7,953,518 $ 7,680,550 $ 9,679,473 $ 10,937,492 $ 10,796,248 $ 15,238,198 $ 16,590,510 $ 18,212,917 All other governmental funds Nonspendable Prepaid items $ 60,963 $ 62,635 $ 80,118 $ 83,359 $ 68,718 $ 243,401 $ 56,397 $ 196,074 $ 83,440 $ 156,157 Restricted for: Tourism 1,052,546 1,025,891 1,107,520 1,081,009 1,003,636 791,308 781,775 734,938 416,064 97,684 Future projects 3,594,379 10,370,914 1,751,405 13,632 13,679 13,789 14,141 14,543 14,719 14,813 Debt service 22,657 1,482 1,081 20,916 30,468 11,963 28,798 44,683 150,518 103,993 Education 758,127 931,094 993,998 1,592,227 1,098,359 729,709 1,068,117 1,323,663 1,685,116 1,898,618 Economic development 178,384 - - - - - - - - - Capital projects funds - - - 17,713,788 8,501,489 15,080,456 7,292,917 6,070,774 4,580,448 8,467,427 Total all other governmental funds $ 5,667,056 $ 12,392,016 $ 3,934,122 $ 20,504,931 $ 10,716,349 $ 16,870,626 $ 9,242,145 $ 8,384,675 $ 6,930,305 $ 10,738,692 Source: Annual financial reports W. Town of Westlake Changes in Fund Balances Governmental Funds Last Ten Years - Continued Modified Accrual Basis of Accounting - Unaudited REVENUES Taxes Licenses, fees and permits Fines and penalties State program revenues Federal program revenues Investment earnings Contributions Other revenues Total revenues EXPENDITURES General government Public safety Cultural and recreation Public works Economic development Visitor services Education Capital Outlay Capital Project Debt service Principal Interest and other fiscal charges Bond issuance cost Total expenditures EXCESS (DEFICIENCY) OF REVENUES OVER (UNDER) EXPENDITURES Exhibit S-4 Fiscal Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 $ 6,393,472 $ 7,226,180 $ 7,722,606 $ 8,252,748 $ 7,902,983 $ 7,867,015 $ 9,321,321 $ 11,881,784 $ 11,174,378 $ 10,065,684 598,394 944,735 1,175,075 1,200,790 2,715,236 3,521,686 2,314,933 5,873,529 1,996,834 2,612,098 622,338 695,167 730,441 734,152 796,014 673,716 633,318 616,451 492,435 582,854 4,369,635 4,696,540 5,269,641 6,173,418 6,543,782 6,603,358 7,217,383 7,415,219 8,011,061 8,482,552 152,351 81,958 80,103 87,797 98,564 140,152 114,797 110,248 137,910 121,678 33,353 24,218 26,713 28,904 55,600 182,095 356,076 517,128 260,003 38,381 732,535 5,916,014 82,446 18,785,953 283,684 728,887 494,131 1,253,200 292,860 1,800,000 1,323,237 1,274,826 1,665,003 2,471,191 1,542,835 2,863,801 1,735,201 1,804,309 1,837,744 1,512,867 14,225,315 20,859,638 16,752,028 37,734,953 19,938,698 22,580,710 22,187,160 29,471,868 24,203,225 25,216,114 1,878,885 1,910,545 2,236,360 2,411,239 3,280,507 4,596,827 3,672,933 5,330,174 5,169,039 5,052,010 2,224,469 1,967,584 2,146,587 2,490,551 2,453,857 2,684,244 2,992,727 3,269,778 3,512,456 3,546,694 111,765 113,924 123,541 130,322 185,923 164,720 183,816 272,146 264,248 182,253 391,115 532,675 615,781 744,028 773,751 784,279 675,550 593,830 622,307 601,562 243,939 296,565 147,685 171,757 141,779 163,578 469,852 306,982 203,407 - 475,719 521,521 493,082 670,157 725,971 717,055 875,322 904,689 781,883 448,414 6,193,560 5,762,652 7,143,678 7,938,501 9,245,592 8,819,174 9,012,348 8,996,714 9,845,685 9,557,739 1,110,476 7,601,631 9,964,047 5,274,282 9,561,954 7,082,844 9,407,447 3,525,437 1,627,548 1,129,642 668,000 2,955,000 1,004,677 1,130,762 1,150,490 1,124,697 1,555,677 1,766,131 1,837,638 1,883,135 952,027 830,425 1,116,489 977,412 947,411 1,105,376 1,182,679 1,128,720 1,103,853 1,052,653 148,891 185,699 69,283 - - 368,278 - - - 130,029 14,398,846 22,678,221 25,061,210 21,939,011 28,467,235 27,611,072 30,028,351 26,094,601 24,968,064 23,584,131 $( 173,531) $( 1,818,583) $( 8,309,182) $ 15,795,942 $( 8,528,537) $( 5,030,362) $( 7,841,191) $ 3,377,267 $( 764,839) $ 1,631,983 Ig] Town of Westlake Exhibit S-4 Changes in Fund Balances Governmental Funds Last Ten Years - Continued Modified Accrual Basis of Accounting - Unaudited Fiscal Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 OTHER FINANCING SOURCES (USES): Sale of assets $ $ - $ $ $ $ 1,200,000 $ $ $ $ Issuance of debt 8,294,800 - - Premium on CO issued 284,437 - 249,742 Refunding bonds issued 7,799,196 2,200,000 1,910,000 5,795,000 4,430,000 Premium on refunding bonds issued - 37,723 84,598 1,020,809 337,298 Payments to bond escrow agent ( 7,650,305) - ( 1,925,315) ( 6,452,467) ( 4,694,366) Issuance of capital lease 239,009 16,740 474,300 - 585,623 Notes payable issued 401,484 162,059 - - - - Certificate of obligations issued - - - - - 10,710,000 3,215,000 Special item 67,760 40,959 - - Extraordinary item ( 124,346) ( 40,959) - - - - - - Transfers in 2,121,099 2,104,929 3,094,211 4,617,896 2,485,227 3,621,066 3,949,085 3,902,325 2,673,972 3,155,275 Transfers out ( 2,075,592) ( 2,590,520) ( 3,050,812) (4,294,796) (2,220,649) (3,451,750) (3,877,619) (3,695,112) (2,596,814) (2,950,261) Total other financing sources (uses) 137,812 10,331,369 753,175 501,899 738,878 12,442,658 71,466 207,213 662,781 3,742,688 NET CHANGES IN FUND BALANCES $( 35,719) $ 8,512,786 $( 7,556,007) $ 16,297,841 $( 7,789,659) $ 7,412,296 $( 7,769,725) $ 3,584,480 $( 102,058) $ 5,374,671 DEBT SERVICE AS A PERCENTAGE OF NONCAPITAL EXPENDITURES 12.5% 25.3% 14.4% 12.8% 11.1% 12.47o 12.9% 13.0% 12.5% 13.1% Source Annual Financial Reports 120 Town of Westlake Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years Modified Accrual Basis of Accounting - Unaudited Appraised Value Less: Total Taxable Total Fiscal Real Personal Tax -Exempt Assessed Direct Year Property Property Property Value Tax Rate 2012 $ 1,016,474,604 $ 85,329,823 $ 156,315,552 $ 945,488,875 0.15684 2013 1,099,249,031 122,792,343 335,814,215 886,227,159 0.15684 2014 1,091,142,760 151,927,427 346,730,543 896,339,644 0.15634 2015 1,123,354,430 139,936,507 342,248,275 921,042,662 0.15634 2016 1,175,230,336 107,537,466 336,770,136 945,997,666 0.15634 2017 1,468,274,115 132,422,540 437,293,366 1,163,403,289 0.13695 2018 1,517,833,356 133,680,163 442,433,216 1,209,080,303 0.13615 2019 1,558,408,769 139,762,420 400,628,631 1,297,542,558 0.15600 2020 1,388,137,170 121,646,081 322,005,656 1,187,777,595 0.16018 2021 2,042,984,947 161,717,042 564,51 1,494 1,640,190,495 0.16788 Source: Tarrant County Appraisal District Denton Central Appraisal District Exhibit S-5 121 Town of Westlake Exhibit S-6 Principal Property Tax Payers Current and Nine Years Ago - Unaudited 2021 2012 Percentage Percentage Taxable of Total Town Taxable of Total Town Assessed Taxable Assessed Taxable Taxpayer Value Rank Assessed Value Taxpayer Value Rank Assessed Value FMR Texas, LLC/LTD Partnership $ 117,339,367 1 7.15% Maguire Thomas Partners, etal $ 150,235,546 1 15.85% SOL Westlake 101,885,372 2 6.21% FM Texas, LLC/LTD Partnership 77,754,274 2 8.20% Cellco Partnership 69,502,321 3 4.247. DCLI, LLC 76,847,119 3 8.11% DCLI, LLC 48,435,854 4 2.95% Corelogic Real Estate 18,050,838 4 1.9070 Magruire Partners -Solana Land LP 36,743,533 5 2.24% Lexington TNI Westlake LP 16,560,450 5 1.757o HMC Solana LLC 36,573,910 6 2.23% Marsh USA, Inc. 10,030,377 6 1.067. Marsh USA, Inc. 30,272,476 7 1.85% First American Leasing 8,804,230 7 0.93% CS Kinross Lane Parkway LLC 29,501,528 8 1.80% Levi Strauss & Co. 8,637,483 8 0.91% Quail Hollow Development I I LLC 28,399,758 9 1.73% Westlake Terra, LLC 6,808,002 9 0.727o Marsh USA, Inc. 19,667,540 10 1.20% Louco Investment Partners LP 6,467,500 10 0.68% Total $ 518,321,659 31.60% Total $ 380,195,819 40.11% Source: Tarrant County Appraisal District Note: (1) Prior to fiscal year ended September 30, 2011, the Town of Westlake did not assess an ad valorem tax. (2) Total Taxable Assessed Value including real and personal property for tax year 2012 (fiscal year 2013) is $886,277,159. (3) Total Taxable Assessed Value including real and personal property for tax year 2020 (fiscal year 2021) is $1,640,190,459. 122 Town of Westlake Property Tax Levies and Collections Last Ten Fiscal Years - Unaudited Taxes Levied Adjusted Fiscal for the Adjustments _ Taxes Levied Year Fiscal Year to Levy for Fiscal Year 2012 $ 1,486,968 $( 47,220) $ 1,439,748 $ 2013 1,398,777 (45,297) 1,353,480 2014 1,405,819 (44,761) 1,361,058 2015 1,450,674 (43,948) 1,406,726 2016 1,482,989 (40,244) 1,442,745 2017 1,573,803 (33,281) 1,540,522 2018 1,661,110 (30,810) 1,630,300 2019 2,007,359 (31,840) 1,975,519 2020 2,365,878 34,399 2,400,277 2021 2,369,205 335,571 2,704,776 Source: Tarrant County Appraisal District Denton Central Appraisal District Collected within the Fiscal Year of the Levy Amount 1,437,908 1,352,097 1,350,639 1,405,148 1,441,536 1,536,921 1,624,655 1,953,575 2,392,470 2,699,328 Percent of Levy 99.87% 99.90% 99.23% 99.89% 99.92% 99.77% 99.65% 98.89% 99.67% 99.80% Exhibit S-7 Collections Total Collections Net of Refunds to Date in Subsequent Percentage Years Amount of Levy > 1,453 $ 1,439,361 99.97% 1,001 1,353,098 99.97% 10,050 1,360,689 99.97% 1,464 1,406,612 99.99% 1,209 1,442,745 100.00% 3,426 1,540,347 99.99% 5,277 1,629,932 99.98% 21,563 1,975,138 99.98% 2,359 2,394,829 99.77% - 2,699,328 99.80% 123 Town of Westlake Direct and Overlapping Property Tax Rates (Per $100 of Assessed Value) Last Ten Fiscal Years - Unaudited Town Direct Rates Overlapping Rates Exhibit S-8 Operating/ School Districts Counties Tarrant Tarrant Trophy Total Fiscal General Debt Service Total (A) Carroll Northwest Keller Denton Tarrant County County Club Direct and Year Fund Fund Direct ISD ISD ISD County County College Dist Hospital Dist. MUD #1 Overlapping 2012 0.13835 0.01849 0.15684 1.41500 1.37500 1.54000 0.28287 0.26400 0.14897 0.22790 0.17500 5.58557 2013 0.14197 0.01487 0.15684 1.40000 1.37500 1.54000 0.28287 0.26400 0.14897 0.22790 0.13339 5.52896 2014 0.13710 0.01924 0.15634 1.40000 1.45250 1.54000 0.27220 0.26400 0.14950 0.22790 0.13339 5.59583 2015 0.13710 0.01924 0.15634 1.40000 1.45250 1.54000 0.27220 0.26400 0.14950 0.22790 0.13339 5.59583 2016 0.13947 0.01687 0.15634 1.40000 1.45250 1.54000 0.27220 0.26400 0.14950 0.22790 0.13339 5.59583 2017 0.12882 0.00813 0.13695 1.39000 1.45250 1.52000 0.24841 0.25400 0.14473 0.22790 0.12722 5.50171 2018 0.11133 0.02482 0.13615 1.38500 1.49000 1.52000 0.23781 0.24400 0.14006 0.22443 0.12021 5.49766 2019 0.13201 0.02399 0.15600 1.38000 1.49000 1.51000 0.22557 0.02340 0.13607 0.22443 0.11618 5.26165 2020 0.11453 0.04565 0.16018 1.30000 1.42000 1.40830 0.22528 0.23400 0.13607 0.22443 0.11618 5.22444 2021 0.12490 0.04298 0.16788 1.28640 1.33630 1.39470 0.22499 0.23400 0.13017 0.22443 0.10774 5.10661 Notes: Prior to fiscal year ended September 30, 2011, the Town of Westlake did not assess an ad valorem tax. Overlapping rates are those of local and county governments that apply to property owners within the Town of Westlake. Not all overlapping rates apply to all Town's property owners (e.g., the rates for the counties and school districts apply only to the proportion of the Town's property owners whose property is located within the geographic boundaries of the county and school district) Source: Tarrant County Appraisal District Denton Central Appraisal District 124 Town of Westlake Taxable Sales by Industry Type Last Ten Fiscal Years - Unaudited NAICS Industry Type 11 21 22 23 31-33 42 44-45 48-49 51 52 53 54 56 61 62 71 72 81 92 Note: Agriculture, Forestry, Fishing and Hunting Mining Utilities Construction Manufacturing Wholesale Trade Retail Transportation and Warehousing I nformation Financial and Insurance Real Estate and Rental and Leasing Professional, Scientific, and Technical Services Admin and Support and Waste Mgmt & Rem Sry Education Services Health Care and Social Assistance Arts, Entertainment and Recreation Accommodation and Food Services Other Services (except Public Administration) Public Administration Town direct sales tax rate Exhibit S-9 Fiscal Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 $ 38 $ 163 $ 731 $ 775 $ 2,083 $ 1,685 $ 4,303 $ 336 $ 196 $ 808 3,050 335 15 714 655 128 5 - 11 20 171,131 176,622 204,280 191,031 138,331 147,000 180,564 183,347 179,545 206,392 139,000 365,049 239,888 216,546 230,067 340,077 1,294,092 2,249,378 1,385,998 667,542 526,755 295,660 375,905 234,651 209,128 86,798 113,487 284,939 350,447 343,715 134,466 59,571 421,371 515,602 356,946 339,854 278,054 533,723 406,321 597,218 1,106,427 1,132,811 962,244 1,332,659 415,356 458,833 428,355 523,021 737,764 942,782 1,156 3,662 1,962 3,550 1,107 1,133 567 624 1,723 731 367,298 378,221 623,828 567,685 551,172 387,714 817,086 793,755 764,753 1,985,535 27,857 75,529 505,585 295,622 754,386 509,201 709,787 835,150 352,872 141,787 215,754 457,693 493,570 708,747 940,971 999,118 675,273 928,259 884,229 174,719 221,331 536,971 242,069 193,145 287,066 261,704 309,704 519,447 596,913 1,014,951 39,027 110,686 103,340 50,264 125,033 85,430 93,967 98,927 76,437 154,815 356,689 373,117 153,279 201,761 230,775 220,078 555,159 577,530 424,882 153,277 106 251 11,018 2,887 228 398 999 592 692 673 204,456 184,687 191,343 189,027 201,391 241,107 216,403 266,915 460,281 379,180 93,123 204,044 221,061 246,755 230,615 233,769 228,003 226,361 122,585 135,043 9,805 13,156 17,412 8,965 3,167 2,963 2,772 2,329 4,285 4,089 135 295 27,243 - - 1 1,391 1,656 1,717 2,427 $ 3,617,604 $ 4,368,523 $ 4,796,144 $ 4,960,386 $ 4,678,477 $ 4,316,991 $ 5,909,966 $ 8,026,289 $ 6,751,651 $ 6,905,704 2.007 2.00% 2.007. 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.007 Due to confidentiality issues, the names of the ten largest revenue payers are not available. The categories presented are intended to provide alternative information regarding the sources of the Town's sales tax revenue Source: Texas State Comptroller reports 125 Town of Westlake Ratios of General Bonded Debt Outstanding Last Ten Fiscal Years - Unaudited Exhibit S-10 General Bonded Debt Outstanding Percentage General Certificates of Actual Fiscal Obligation of Taxable Per Year Bonds Obligation Tax Notes Total Sales Capita 2012 $ 16,770,000 $ 4,877,000 $ $ 21,647,000 11.84% 19,519 2013 16,590,000 13,622,000 30,212,000 13.81 % 26,271 2014 18,260,000 11,044,000 29,304,000 12.4017o 24,750 2015 17,480,000 11,046,131 - 28,526,131 11.58% 22,409 2016 17,091,659 10,739,306 - 27,830,965 11.30% 20,080 2017 15,267,000 18,460,700 1,530,000 33,727,700 14.50% 22,697 2018 15,457,018 19,361,251 1,328,000 36,146,269 15.54% 23,200 2019 14,504,400 20,957,422 1,116,000 36,577,822 12.19% 22,719 2020 13,512,294 20,341,544 901,000 34,754,838 9.42% 20,886 2021 13,582,994 19,149,872 682,000 33,414,866 10.49% 18,160 Notes: Details regarding the Town's outstanding debt can be found in the notes to the financial statements. There was no debt issued until fiscal year 2002. See Table 13 for personal income and population data. $ 40 $ 35 $ 30 $ 25 H $ 20 c 0 $15 i $10 $5 $- 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 ■ General Obligation Bonds ■ Certificates of Obligation ■ Tax Notes 126 Town of Westlake Ratios of Outstanding Debt by Type Last Ten Fiscal Years - Unaudited Exhibit S-I I Governmental Activities Business -Type Activities General Certificates Other Certificates Total Percentage Fiscal Obligation of Capital Contractual of Primary of Personal Year Bonds Obligation Tax Notes Leases Loans Obligations Obligation Government Income 2012 $ 16,770,000 $ 4,877,000 $ $ - $ 34,075 $ 5,498,668 $ - $ 27,179,743 20% 2013 16,590,000 13,622,000 - 18,150 5,412,149 - 35,642,299 24% 2014 18,260,000 10,029,800 237,378 437,253 5,320,824 1,014,200 35,299,455 22% 2015 17,480,000 9,759,250 154,347 357,041 5,226,294 1,286,881 34,263,813 23% 2016 17,091,659 9,736,953 563,045 275,101 5,126,958 971,300 33,765,016 19% 2017 15,457,018 19,361,251 1,328,000 162,004 238,404 5,156,839 949,300 42,652,816 23% 2018 15,457,018 18,432,779 1,328,000 162,004 201,737 4,913,865 956,009 41,451,412 207 2019 14,504,400 17,930,135 1,116,000 - 165,050 4,800,109 3,027,287 41,542,981 207 2020 13,512,294 14,424,079 901,000 398,012 128,373 4,679,944 2,917,465 36,961,167 17% 2021 13,582,994 19,149,872 682,000 152,921 91,696 4,679,944 2,802,643 41,142,070 177 Note: Details regarding the Town's outstanding debt can be found in the notes to the financial statements. No debt was issued until fiscal year 2000. See Table 13 for personal income and population data. $ 60 $ 40 $ 20 0 $ 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 ■ General Obligation Bonds ■ Certificates of Obligation ■ Capital Leases ■ Loans ■ Business -Type Activities ■ BT Certificates of Obligation ■ Tax Notes ■ Contractual Obliqations Per Capita 24,508 30,993 25,576 32,150 29,812 28,703 28,308 28,765 23,246 22,008 127 Town of Westlake Direct and Overlapping Governmental Activities Debt As of September 30, 2021 - Unaudited Taxi n Carroll I SD Denton County Keller ISD Northwest ISD Tarrant County Tarrant County College District Tarrant County Hospital District Trophy Club M U D# 1 Total Overlapping Debt Town of Westlake Outstanding Debt Total Direct & Overlapping Debt Amount of Debt Outstanding $ 329,880,000 571,605,000 877,564,989 1,223,981,739 213,675,000 255,995,000 14,495,000 6,395,000 As of 9/30/2021 9/30/2021 9/30/2021 9/30/2021 9/30/2021 9/30/2021 9/30/2021 9/30/2021 Overla Percent (1) 6.89% $ 0.03% 4.06% 1.90% 0.71 % 0.71 % 0.71 % 30.46% Exhibit S-12 Amount 22,728,732 171,482 35,629,139 23,255,653 1,517,093 1,817,565 102,915 1,947,917 87,170,496 33,659,483 120,829,979 Source: Texas Municipal Report prepared by employees of the Municipal Advisory Council of Texas ("MAC") Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the Town. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the Town of Westlake. This process recognized that, when considering the Town's ability to issue and repay long-term debt, the entire debt burden borne by the resident 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. (1) the percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated by determining the portion of the entity's taxable assessed value that is within the Town's boundaries and dividing it by the entities' total taxable assessed value. 128 Town of Westlake Demographic and Economic Statistics Last Ten Fiscal Years - Unaudited Exhibit S-13 Year Population Income Income Age Enrollment Rate 2012 1109 $ 112,697 $ 138,423,531 41.8 630 6.0% 2013 1,150 114,951 147,292,890 41.4 658 5.0% 2014 1,184 117,250 160,462,095 41.2 697 4.0% 2015 1,273 119,595 144,111,592 41.8 812 4.1 % 2016 1,386 121,987 173,419,076 41.7 825 3.2% 2017 1,486 124,427 162,998,462 41.5 830 3.4% 2018 1,558 126,915 197,733,767 41.2 856 3.4% 2019 1,610 129,453 208,420,020 41.2 869 3.1 % 2020 1,664 132,042 219,718,715 42.8 890 7.7% 2021 1,840 134,683 247,817,359 45.6 856 4.1 % Sources: Tarrant County Unemployment Rate information taken from Texas Workforce Commission. Municipal Advisory Council of Texas - Population USA.com - Per Capita Income source North Central Texas Council of Governments United States Census - Median Age Estimated Population 2000 1,273 1, 386 1,486 1500 1109 1,150 1,184 1000 500 0 ttv 2012 2013 2014 2015 2016 2017 129 Town of Westlake Principal Employers Current and Ten Years Ago - Unaudited 2021 Percentage of Estimated Total Town Employer Employees Employment Schwab Fidelity Investments Sabre JLL Facilities Wells Fargo Core -Mark Deloitte Robinhood Verizon Goosehead Insurance Solera Defi Solutions Sound Physicians Town of Westlake/Westlake Academy All Other Businesses Total Exhibit S-14 2012 Percentage of Estimated Total Town Employer Employees Employment 7,000 34.87% Fidelity I nvestments 6,716 33.45% Core Logic 1,380 6.87% Wells Fargo 617 3.07% 1D Auto Finance 560 2.79% McKesson Corporation 500 2.49% Sabre JLL Facilities 478 2.38% Walco International 405 2.02% Vaquero Club 391 1.95% Marriott Solana Hotel 261 1.30% Town of Westlake/Westlake Academy 214 1.07% Levi Strauss 173 0.86% All Other Businesses 151 0.75% 1,229 6.12% 20,075 100% Total Source: Cushman &Wakefield tenant records and contact with employers of the Town 4,724 1,790 580 595 208 196 159 135 124 94 70 699 50.39% 19.10% 6.19% 6.35% 2.22% 2.09% 1.70% 1.44% 1.32% 1.00% 0.75% 7.46% 9,374 100,7 130 Town of Westlake Full -Time Equivalent Town Government Employees by Function/Program Last Ten Fiscal Years - Unaudited Exhibit S-15 Function/Program 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 General government Town Manager 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Deputy Town Manager 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1.00 1.00 1.00 Assistant Town Manager 0.00 0.75 0.90 1.00 0.90 1.00 1.00 1.00 1.00 1.00 Assistant to Town Manager 0.75 0.00 0.00 0.00 0.50 0.50 0.75 0.00 1.00 0.00 Administrative 0.75 1.00 0.50 0.50 0.00 1.50 1.00 1.00 1.00 1.00 Planning and Development 1.33 1.50 1.66 1.66 3.17 4.00 4.00 4.00 4.00 4.00 Town Secretary 1.00 1.00 1.00 1.25 1.25 1.50 1.50 1.50 1.00 1.00 Facilities/Grounds maintenance 0.83 1.00 1.09 1.34 1.58 0.50 1.75 1.00 0.83 0.83 Municipal 3.75 4.75 5.10 5.00 4.60 4.00 3.50 4.25 4.75 4.75 Finance 3.00 3.00 4.00 4.00 4.25 4.00 4.00 4.00 3.00 5.00 Payroll/Human Resources 1.33 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 1.00 Information Technology 0.00 0.00 1.00 1.00 1.00 1.00 2.00 2.00 2.00 2.00 Public safety (EMS) 9.00 10.00 13.25 14.25 14.25 11.00 15.50 15.50 15.00 18.00 Culture and recreation 0.50 0.75 0.84 0.84 0.84 0.50 0.50 1.00 0.83 0.83 Public works 2.00 3.00 2.66 2.66 2.67 3.00 4.00 4.00 4.33 4.33 Marketing and public affairs 1.00 1.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 Education 67.48 76.18 91.18 93.65 95.31 95.05 98.00 95.00 100.26 103.51 Total 93.72 106.93 128.18 132.15 135.32 132.55 142.50 140.25 145.00 151.25 Source: Prior Town budgets and Academy personnel records Note: A full time municipal employee is scheduled to work 2,080 hours per year (including vacation and sick leave). Fulltime equivalent employment is calculated by dividing total labor hours by 2,080. A full time education employee is scheduled to work 1,122 hours per year. 131 Town of Westlake Operating Indicators by Function/Program Last Ten Fiscal Years - Unaudited Fiscal Year Exhibit S-16 Function/Program 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 General government Permits issued 85 132 144 159 218 217 259 250 193 221 Permit values $ 29,481,047 $ 50,544,048 $ 59,358,904 $ 80,011,354 $ 87,307,794 $ 262,690,940 $ 311,013,915 $ 332,197,798 $ 65,739,881 $ 109,039,264 Police (Contract with Keller PD) Motor vehicle stops 12,221 9,993 9,579 10,432 11,109 10,718 8,339 7,729 7,457 7,049 Traffic accident investigations 343 322 341 398 461 386 333 327 219 254 Part I crimes 39 9 15 20 13 22 31 14 48 48 DWI arrests 50 69 55 62 66 70 50 25 33 36 Fire/EMS Fire runs 181 238 211 211 257 248 320 235 308 371 Ambulance runs 266 286 240 253 288 269 202 206 128 272 Inspections 54 96 286 261 246 290 188 227 103 165 Public Works - General Street resurfacing (I-F) 30,000 - - - - 6,000 - - 5,012 8,820 Potholes repaired 6 2 6 20 20 10 5 8 10 15 Public Works -Utility Number of water accounts 568 614 651 713 752 810 835 762 773 853 Water main breaks 4 3 1 1 - - 1 2 4 2 Avg daily consumption MG (water) 1.100 1.090 1.045 1.021 1.122 1.233 1.400 1.209 1.000 1.250 Peak daily consumption MG (water) 2.600 2.480 2.690 2.770 1.586 1.646 1.564 2.709 2.709 2.789 System capacity - MG (water) 1.685 1.685 2.685 2.685 2.685 2.685 2.685 2.685 2.685 2.685 Water purchased (in gallons x 000) 407,305 401,457 381,482 372,838 409,817 450,208 510,931 441,352 462,529 248,329 Water sold (in gallons x 1000) 376,496 357,297 347,148 360,000 350,000 419,520 470,168 422,635 492,376 463,536 Wastewater Number of new sewer connections 292 325 350 384 403 454 503 541 545 579 Avg daily sewage treatment 0.136 0.151 0.208 0.166 0.132 0.176 1.171 1.171 0.210 0.191 (thousands of gallons) Source: Various Town departments Notes: N/A represents information that is unavailable 132 Town of Westlake Capital Asset Statistics by Function/Program Last Ten Fiscal Years - Unaudited Fiscal Year Exhibit S-17 Function/Program 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Fire Stations 1 1 1 1 1 1 1 1 1 1 Public Works - Utility Pump station 1 1 1 1 1 1 1 1 1 1 Lift station 3 3 3 3 3 3 3 3 3 3 Telecommunications Duct Bank (LF) 57,783 57,783 59,936 66,084 66,084 82,231 82,231 82,231 86,711 86,711 Telecommunications Duct Bank Manholes 122 122 122 140 140 140 140 140 160 160 Water Water mains (LF) 137,891 137,891 142,694 148,117 148,117 181,393 181,393 181,393 188,387 188,387 Fire hydrants 191 191 201 214 214 256 256 256 267 267 Storage capacity MG 1,685 1,685 2,685 2,685 2,685 2,685 2,685 2,685 2,685 2,685 Wastewater Sanitary sewers (LF) 94,000 94,000 98,964 104,373 104,373 123,168 123,168 123,168 128,923 128,923 Manholes 304 304 326 355 355 444 444 444 467 467 Public Works - Utility Streets (miles) 10.25 10.25 10.25 10.50 10.42 10.42 10.42 10.84 10.84 10.84 Traffic signals (school zone flashers) 2 2 2 2 2 2.0 2.0 2.0 2.0 4.0 Parks and recreation Open Space (acres) 25 25 27 27 27 27.0 27.0 27.0 27.0 27.0 Playgrounds 2 2 2 2 2.0 2.0 2.0 2.0 2.0 2.0 Softball/soccer field 1 1 1 1 1.0 1.0 1.0 1.0 1.0 1.0 Football field 1 1 1 1 1.0 1.0 1.0 1.0 1.0 1.0 Public trails (miles) 5.0 5.0 7.0 8.5 8.5 8.5 15.0 16.0 16.0 16.0 Source: Various Town departments Note: No capital asset indicators are available for the general government. 133