ML022830040

Annual Financial Reports for South Texas Project Electric Generating Station, Table of Contents - Exhibit F-4, Page 136

ML022830040
Person / Time
Site:	South Texas
Issue date:	10/01/2002
From:	George Wilson South Texas
To:	Document Control Desk, Office of Nuclear Reactor Regulation
References
31497337, G20, NOC-AE-02001413
Download: ML022830040 (170)

Text

Comprehensive Annual Financial Report City of Austin, Texas For the year ended September 30, 2001 Prepared by:

Financial and Administrative Services Department John Stephens, CPA Director Barbara Nickle, CPA Controller Members of the Government Finance Officers Association of the United States and Canada

City Council Gus Garcia Mayor.....'%' '

Term expires June 15,2003 Jackie Goodman Mayor Pro Terh" Term expires June 15, 2002 Council Members Raul Alvarez Beverly Griffith Daryl Slusher Danny Thomas Will Wynn June 15, 2003 June 15, 2002 June 15;2002 June 15, 2003 June 15, 2003 Jesus Garza City Manager

CITY OF AUSTIN, TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT Year Ended September 30, 2001 TABLE OF CONTENTS INTRODUCTION Exhibit Page Letter of Transmittal i

City Organization Chart xv Certificate of Achievement xvi FINANCIAL SECTION Independent Auditors' Report xvii GENERAL PURPOSE FINANCIAL STATEMENTS All Fund Types and Account Groups - Combined Balance Sheet A-1 2

All Governmental Fund Types and Expendable Trust Funds - Combined Statement of Revenues, Expenditures and Changes in Fund Balances A-2 8

General Fund, Special Revenue Funds and Debt Service Fund - Combined Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual-Budget Basis A-3 10 All Proprietary Fund Types and Similar Trust Funds - Combined Statement of Revenues, Expenses and Changes in Retained Earnings/Fund Balances A-4 12 All Proprietary Fund Types and Similar Trust Funds - Combined Statement of Cash Flows A-5 14 Notes to Combined Financial Statements:

Note 1 Reporting Entity.

18 Note 2 Significant Accounting Policies 18 Note 3 Budget Basis Reporting 28 Note 4 Deficits in Fund Balance and Retained Earnings 31 Note 5 Pooled Investments and'Cash 32 Note 6 Investments and Depiosits 32 Note 7 Property Taxes 34 Note 8 Fixed Assets 35 Note 9 Retirement Plans 36 Note 10 Selected Revenues 39 Note 11 General Long-Term Debt 39 Note 12 Enterprise Funds - Revenue Bonds and Other Long-Term Debt 43 Note 13 Conduit Debt 49 Note 14 Debt Service Requirements 50 Note 15 Interfund Receivables and Payables 56 Note 16 Interfund Transfers 58 Note 17 Segment Information 60 Note 18 Joint Operations 61 Note 19 Litigation 64 Note 20 Commitments and Contingencies 64 Note 21 Other Post-Employment Benefits 69 Note 22 Subsequent Events 70 I

CITY OF AUSTIN, TEXAS COMPREHENSIVE ANNUAL FINANCIALCREPORT Year Ended Se'ptember 30, 2001

• TABLE OF CONTENTS FINANCIALSECTION, Continued Exhibit Page SUPPLEMENTAL INFORMATION GOVERNMENTAL FUNDS General Fund Balance Sheet Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual-Budget Basis Schedule of Revenues - Budget and Actual-Budget Basis Schedule of Expenditures - Budget and Actual-Budget Basis Schedule of Transfers - Budget and Actual-Budget Basis Special Revenue Funds Combining Balance Sheet Combining Statement of Revenues, Expenditures and Changes in Fund Balances Combining Balance Sheet - All Special Revenue Grants Combining Statement of Revenues, Expenditures and Changes in Fund Balances - All Special Revenue Grants Combining Schedule of Expenditures - All Special Revenue Grants Enterprise Related - Combining Balance Sheet Enterprise Related - Combining Schedule of Expenditures Other - Combining Balance Sheet Other - Combining Statement of Revenues, Expenditures and Changes in Fund Balances' Other - Combining Schedule of Revenues, Expenditures and Transfers - Budget and Actual-Budget Basis Debt Service Fund Combining Balance Sheet Combining Statement of Revenues, Expenditures and Changes in Fund Balances Combining Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual-Budget Basis Capital Projects Funds Combining Balance Sheet Combining Statement of Revenues, Expenditures and Changes in Fund Balances Combining Balance Sheet Combining Statement of Revenues, Expenditures and Changes in Fund Balances B-1 B-2 B-3 B-:4 B-5 S-C-i1 C-2

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CITY OF AUSTINTEXAS COMPREHENSIVE ANNUAL, FINANCIAL REPORT Year Ended September 30, 2001 TABLE OF CONTENTS FINANCIAL SECTION, Continued Exhibit Page PROPRIETARY FUNDS Enterprise Funds Combining Balance Sheet Combining Statement of Revenues, Expenses and Changes in Retained Earnings Combining Statement of Cash Flows Combining Schedule of Changes in Fixed Assets and Accumulated Depreciation Internal Service Funds Combining Balance Sheet Combining Statement of Revenues, Expenses and Changes in Retained Earnings Combining Statement of Cash Flows Combining Schedule of Changes in Fixed Assets and Accumulated Depreciation F-1 F-2 F-3 F-4 G-1 G-2 G-3 G-4 118 124 126 132 138 140 142 146 FIDUCIARY FUNDS Trust and Agency Funds Combining Balance Sheet H-1 148 Expendable Trust Funds Combining Balance Sheet Combining Statement of Revenues, Expenditures and Changes in Fund Balances H-2 H-3 149 150 Agency Funds Combining Balance Sheet Combining Statement of Changes in Assets and Liabilities H-4 152 H-5 153 ACCOUNT GROUPS General Fixed Assets Schedule of Changes in General Fixed Assets General Long-Term Debt Schedule of Changes in General Long-Term Debt I-1 155 1-2 156 J-1 157 J-2 158 SUPPLEMENTAL SCHEDULES Schedule of General Obligation Bonds Authorized and Unissued Schedule of Revenue Bonds Authorized, Deauthorized and Unissued

CITY OF AUSTIN, TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT Year Ended September 30, 2001 TABLE OF CONTENTS STATISTICAL SECTION - UNAUDITED Exhibit Page General Government Total Expenditures and Expenditures Per Capita 1

162 General Obligation Net Debt and Net Debt Per Capita 2

163 City of Austin Employees Per Capita 3

164 Ratio of General Fund Unreserved Ending Balance to General Government Annual Expenditures 4

165 Table Page General Government Expenditures by Function 1

166 General Government Expenditures by Function (Constant Dollars) 2 168 General Fund Revenues and Other Financing Sources by Source 3

169 Assessed Valuation, Estimated Market Value, Tax Rates, Tax Levies, and Tax Collections 4

170 Principal Taxpayers 5

171 Ratio of Net General Bonded Debt to Assessed Value and Net Bonded Debt Per Capita 6

172 Ratio of Annual Debt Service Expenditures for General Bonded Debt to Total General Fund Expenditures 7

173 Computation of Legal Debt Margin 8

174 Computation of Direct and Overlapping Debt 9

175 Property Tax Rates and Tax Levies for Direct and Overlapping Governments with Applicable Percentages Over 10%

10 176 City Sales Tax - Tax Levied Effective January 1, 1968 11 177 Electric Fund and Water and Wastewater Fund - Miscellaneous Statistics 12 178 Electric Fund and Water and Wastewater Fund - Five-Year Comparative Operating Statement 13 179 Electric Fund and Water and Wastewater Fund - Plant Cost and Equity in Utility Systems 14 181 Schedule of Combined Utility Systems Revenue Bond Coverage 15 182 Transfers from Electric Fund and Water and Wastewater Fund to General Fund 16 183 Electric Fund and Water and Wastewater Fund - Statistical Data 17 184 Water and Wastewater Fund - Large Customers 18 185 Schedule of Insurance in Force 19 186 Hotel-Motel Occupancy Tax - Tax Levied Effective January 1, 1971 20 188 Miscellaneous Statistical Data 21 189 Miscellaneous Statistical Data - Economic and Growth Indicators 22 190 Miscellaneous Statistical Data - Employment Characteristics 23 191 Elements of Budget Fund Balance for Selected Operating Funds 24 192

INTRODUCTION

City of Austin Founded by Congress, Republic of Texas, 1839 Municipal Building, Eighth at Colorado, P.O. Box 1088, Austin, Tekas 78767 February 27, 2002 Honorable Mayor and Council Members City of Austin, Texas W/e are pleased to submit to you the 2001 Comprehensive Annual Financial Report of the City of Austin, Texas. The report was prepared by the Controller's Office of the Financial Services Department. The combined financial statements and related notes have been jointly audited by the independent firms of Certified Public Accountants, KPMG LLP, and Richard Mendoza, CPA, whose report is included herein. This audit satisfies Article VII, Section 16 of the City Charter, which requires an annual audit of all accounts of the.City by an independent Certified Public Accountant. The Federal awards received by the City directly from Federal agencies or passed through by the State of Texas or other governmental entities during fiscal year 2001

-are being audited under the provisions of the Single Audit Act of 1996, as amended, and State awards are being audited under the provisions of the State of Texas Single AuditCircular. The reports (the "Single Audit Reports") will be available under separate cover.

Responsibility for both the accuracy of th-epresented data and the ýompleteness and fairness of the presentations, including all disclosures, rests with the City. We believe the data, as presented, are accurate in all material respects and are presented in a manner which fairly sets forth the financial position and results of operations of the City. Furthermore, we believe that all disclosures necessary to enable the reader to gain an understanding of the City's financial activity have been included.

These f*nancial statements have been prepared in accordance with generally accepted accounting principles for local governments as prescribed by the Governmental Accounting Standards Board (GASB) and the American Institute of Certified Public Accountants (AICPA).

The City received a Certificate of Achievement for Excellence In Financial Reporting from the Government Finance Officers Association of the United States and Canada (GFOA) for, its 2000 Comprehensive Annual Financial Report (CAFR).

A Certificate of Achievement is valid for a period of one year only. City management believes that this 2001 CAFR conforms to the Certificate of Achievement Program requirements, and we are submitting it to GFOA for its review.

This CAFR consists of three parts. The introductory section includes an organization chart and this transmittal letter, which highlights significant aspects of financial operations during the year and particular financial issues faced by theCity. The financial section includes the independent auditors! report, combined financial statements and related notes, and supplemental financial data. The statistical section includes several exhibits and tables of unaudited data depicting the financial history of the City, as well as demographic and other miscellaneous statistics.

Reporting Entity-.

The City of Austin, chartered in 1839, has a Council-Manager form of government with a Mayor and six Councilmembers. The Mayor and Councilmembers are elected at large for three-year staggered terms, with a maximum of two consecutive terms.

The City Manager, appointed by the City Council, is responsible to them for the management of all City employees and the administration of all City affairs.

This report includes financial statements of-the fundstand account-groups required to account for those activities, organizations and functions that relate to the City and are controlled by or dependent upon the City's governing body, the City Council.- Criteria used by the City for including activities in preparing its financial statements are in conformity with Statement No. 14 of the Governmental Accounting Standards Board, The Financial Reporting Entity. +On the basis of these criteria, the following activities and organizations are included in the City's 2001 financial statements: municipal services inauding police and fire, sanitation, parks and recreation, libraries, public health and social services, urban growth management, infrastructure and watershed maintenance, electric and water and wastewater,utilities, airport facilities, convention facilities, and general administrative services; the Austin Housing Finance Corporation, whose activities are reported in the Housing Assistance Fund, a special revenue fund; and the Austin Industrial Development Corporation, whose activities are included in the Austin Industrial Development Corporation Fund, a special revenue fund.

Year In Review Fiscal year 2001 was a year of change for the City and the nation, with all of us feeling the effects of the softening economy and the impact of the September 11 events on the economy as well as on the cost of municipal government. The economic slowdown resulted in lower than anticipated sales tax revenues, with actual collections 6.5% below budget. The City took steps in mid-year to identify savings to offset the revenue shortfall, and as a result was able to end the year with a balance in excess of $23.9 million Austin is experiencing a change in leadership on the heels of 2001, with a new Mayor recently taking the helm and a new City Manager in the City's future.

In November 2001, Mayor Gustavo Garcia was elected to fill the unexpired term of Mayor Kirk Watson, who resigned to run for State-wide office. Mayor Garcia returns to city government, where he previously served as City Councilmember for 10 years. In January 2002 the City Manager submitted his resignation, effective the end of April, at which time the current Deputy City Manager will become Acting City Manager.

During fiscal year 2001, City leaders continued to focus on four major areas: public safety;, sustainability; youth, family and neighborhood vitality; and affordability. In the area of public safety, the City experienced several improvements. The Police Department (APD) maintained near full strength with the assistance of an increase in authorized sworn strength by 26 officers to maintain the ratio of 1.9 officers'per 1000 residents.

Eight of those 26 officers were assigned specifically to traffic enforcement. In addition,' 35 new civilian p6sitions were added to serve the department in areas that do not require police authority.

These positions not only' increased officer efficiency throughout the department, but also allowed the full redeployment of eight officers.

Further,' the Commission on Accreditation for Law Enforcement Agencies, Inc. (CALEA) officially awarded accredited status to APD in December 2000. APD joins an elite group of more than 500 law enforcement agencies in the United States, Canada, and Barbados that have received this prestigious international recognition.

The Fire Department increased the authorized sworn positions by 54 during 2001, and increased estimated success in containing fires to the room or area of origin in 75% of calls. Emergency Medical Services estimated maintaining a high response time by responding to 91% of priority one calls in less than 11 minutes.' Additionally, six FTEs were added to the Communications Center in order to maintain the goal in call processing time of less than 70 seconds. These positions will also be critical in future years, as they will hell5 staff the new public safety combined communications center in 2003. The City also took major steps during 2001 to upgrade and enhance 9-1-1 services.

The City broke ground on the new combined emergency center, which will replace the City of Austin and Travis County 9-1-1 center, and will provide cntical upgrades to current emergency servicd systems. The City also implemented a 3-1-1 non-emergen6y public safety telephone system. This non-emergency system is a major improvement, because it frees 9-1-1 personnel to handle real emergency situations.

In support of the sustainable community initiative, the City established two funds in 2001: the Sustainability Fund and the Economic Development Fund. The Sustainability Fund provides resources for projects that will help the City of Austin build a sustainable economic,' environmental and equitable infrastructure - the three We's" that make up sustainability.

In its initial year, funding was provided for construtction projects that would ease traffic'congestion and pave the way for development in the less environmentally sensitive areas of the City. In addition workforce development, childcare and housing initiatives were "supported by this fund to increase access to the workplace for Austin citizens.' The Economic Development Fund will allow Austin Energy, the City's electric utility, to increase the density in growth of existing infrastructure and shorten the time it takes to bring new customers on line, as well as give the City the ability to plan and implement growth and redevelopment strategies on a timely basis.

In 2001, the City continued to make progress on various projects authorized in the 1998 bond election with improvements to transportation and mobility needs; improvements to public safety facilities and systems; enhancement of the library and park systems; and addressing watershed issues.

In addition, voters approved bonds in November 2000 for transportation and mobility projects. The bulk of this funding is earmarked as matching funds for State highway (SH) projects such as continued improvemyients to SH 183, which will improve access to Austin-Bergstrom International Airport, extension of Loop 1 Northi ind construction of an east-west highway, SH 45N,, in the northern portion of Travis County. The City is also receiving funding for transportation and mobility projects to improve transportation options for pedestrians and bicyclists.

The City also continued implementation of its Smart Growth initiative begun in 1998. Smart Growth, a nationwide movement that addresses problems'of both cities and suburban areas through strategies that encourage more infill development, more concentrated developrnentand more redevelopment, brought many changes to Austin: In one of the most significant efforts by the City to revitalize downtown, the City and Computer Sciences Corporation (CSC) entered into an agreement in 1999.

Under this agreement, CSC constructed two downtown facilities that opened this year, and the City broke ground on the new city hall parking garage.

The new city hall is scheduled for completion in February 2004.

In addition, an 800-room headquarters hotel is being built adjacent to the Austin Convention Center.

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The slowing economy has had some impact on the Smart Growth initiative., CSC delayed a third building and, in January 2002, the City purchased the right to develop the land upon which CSC would have constructed that building. Intel, which had begun construction of a headquarters facility downtown, has stopped work on the project for the foreseeable future. Vignette, which had planned to construct a building and relocate to downtown, has canceled this plan. However, several downtown tdevelopments continued, including lofts and residential areas.

The City's focus on the area of youth, family and neighborhood vitality led to a reorganization of City departments, so that the City now has an Integrated neighborhood services and neighborhood planning department to provide a more seamless delivery of service.

In the area of affordability, the City remains committed to providing city seMces efficiently and at a reasonable cost.. The City began adjusting to the slowing economy by implementing a savings plan early in the year.'.The City's bond rating agencies recognized Austin's efforts to manage in this economic downturn by maintaining or enhancing the' City's bond ratings: in January 2001, Fitch upgraded both the City's combined utility debt and its water-wastewater separate lien obligations from "A" to 'A+", while at the same time, Standard and Poor's changed the outlook for the City's combined utility debt from "stables to "positive."

The City's electric utility (Austin Energy) is a significani operation'within the City. National attention focused on the electric industry in 2001. Significant increases in the price of natural gas and wholesale power, the "California power crisis' and the financial problems of major dtilities (Pacific Gas & Electric,'SoCal Edison and Enron) were In the news daily. Energy policy was,a leading concern for Federal and State legislators. Many states began to re-evaluate electric restructuring legislation adopted or under consideration and considered implementation delays in light of California's crisis.

On December 2, 2001, Enron (considered 'the largest and 'most successful energy traier in the' U.S.) sought bankruptcy protection following an announcement in October 2001 of over $500 million in loss adjustments to its net income. This again brought the electric industry to the forefront of public attention as many investors suffered significant financial losses.

At the State level, Texas' electric utility restructuring bill,' Senate Bill 7 (SB7),' effective 'on September 1, 1999 opened the Texas electric market for retail competition.

Under SB7, generation and sales are unregulated, but transmission and distributi6n' remain regulated.

Pilot programs and wholesale market design changes to support retail electric 'market c6mpetition began In the summer of 2001.

The Texas' retail competition'pilot program was intended to 'provide 5% of investor owned utilities' (IOU) customers the opportunity to choose their Retail Electric Provider (REP). Due to delays in software implementation, only a handful of customers - just enough to allow system testing - were switched during the Initial months. On July 31, 2001, the Electric C-Reliability Council of Texas (ERCOT - Texas'Independent System Operator) consolidated into a single electric control area and implemented new procedures for managing the Texas electric grid in a deregulated market. Pilot program switching activity was increased in the fall and over 100,000 customers switched to a new retail provider by the'end of 2001 'Retail competition began, with little fanfare, January 1, 2002 for customers of most Texas investor owned utilities.

'Major provisions'of SB7 affecting Municipally Owned Utilities (MOUs) include:

Options to offer retail competition or "opt in" by governing body's adoption of a resolution.' A decision to "opt in" is irrevocable.

May determine their stranded costs and recovery periods.

Not subject to rate reductions imposed upon the investor-owned utilities.

Not required to sell generation assets or participate in capacity auctions.

Concern about the California power crisis spilled over to the Texas electric market, which was examined for sirmilarities. The Texas market has several protections that were not available in California such as:"

"* Current oersupply of generation In Texas, unlike the thin margins in the Western U.S.

"* Long-term or bilateral contracts are allowed.

° Texas has no mandatoiry ýoweir exchange.

STexas did not require utilitieisto sell generation assets pIrior to the retail m~arket.

A "price to beat" was set for retail electric providers affiliated with an existing Investor owned utility, however, periodic adjustments are allowed for increasing fuel costs....

Limitations in Texas' transmission system result in constraints during the peak load periods. The transmission system was originally built to provide service generally from locally situated generation to near-by population centers and to provide critical links between systems In the event of emergencies or shortages., Deregulation of the wholesale market had already put strains on the transmission system not contemplated -when it was designed and built.- Additional, transmission system construction is underway to relieve constraints; however, these6are long-term projects and will not provide immediate relief.-

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The City and Austin Energy have ongoing initiatives to strengthen the electric utility's competitive position. The City Council has given clear direction that Austin does not plan to "opt-in" or open its service area for retail competition at this time.

However, it is always prudent to be in a position to respond if conditions should change.

The City Council approved financial targets for the electric utility in 1996, and revised them in 1999 to add renewable energy targets. The electric utility continues to successfully meet these long-range financial targets demonstrated by:

"* Improving its competitive position through reduced costs and improvements in reliability and customer service.

"* Improving the utility's debt to equity ratio from 79% in 1994 to 62% by 2001 through reducing reliance on debt financing of its capital program.

"* Directing all utility excess cash to a debt management account (revenue bond future debt service account) accumulating over $185 million since 1996 and allowing its use to improve the utility's competitive position.

"* Austin Energy's General Fund transfer remains within an established target range of 6.6% to 9.1% of total revenue.

Additional initiatives and competitive actions include:

"* City Council adoption of resolutions for open records (governing competitively sensitive information), opt-in conditions and electric utility purchasing.

"* Unbundling of utility revenue bond debt to provide additional strategic and operational flexibility and improve competitive position.

"* Closed the Combined Utilities Revenue Bond Prior Lien and Subordinate Lien and plan no future debt issuance under this combined pledge. The prior and subordinate lien bond ordinances remain in effect while such bonds remain outstanding.

In June 2000, the water and wastewater utility issued its first debt under a Separate Lien Obligation Master Bond Ordinance (lien on water and wastewater systeim's revenues).

"* Developed a new Separate Lien Electric Revenue Bond Master Ordinance (lien on electric revenues). This ordinance does not require a debt service reserve fund, loosened the additional bonds' test and eased the rate covenant for bonds issued under this ordinance. -The initial debt issuance under this new ordinance in January 2001 was favorably rated 'A" by Fitch Ratings, "A-" with a Positive Outlook by Standard & Poor's and "A-" by Moody's Investors Service, Inc.

"* Began evaluation of best use of Debt Management account to improve the utility's competitive position through debt reduction.

"* Generation peaking capacity additions, funded with internally generated cash plus $36.8 million from the Debt Management account, were completed and operational prior to the 2001 summer peak. Preparation for the construction of a combined cycle generation plant (scheduled for completion in 2004) continued.

Continued implementation of integrated outage and work management software expected to improve customer service.

Fiscal year 2001 was another strong year financially for Austin Energy, with net income of $103.4 million.

Net income has been reinvested in the electric system to improve competitive position, reliability and customer service.

Austin Energy continues to meet its service area load with its own generation to limit exposure in the wholesale market. Although the local economy slowed during 2001, continued growth in energy demand is expected, albeit at a slower pace than in recent years.,

Attention focused on natural gas prices during 2000 and 2001. Austin Energy implemnented stair-step increases in the fuel component of its electric rate to recover increased gas costs during 2000 and 2001. With these increases, full recovery was accomplished by December 2001 and a fuel component reduction was implemented January 1, 2002. Austin Energy's fuel rate continues to be the lowest among Texas utilities.

Economic Outlook The national economy experienced a downturn in 2001, with consumer confidence dropping to a five-year low. The U.S. real gross domestic product (GDP) increased by 1.1%, and the growth for each quarter of 2001 was less than the same quarter of the prior year. As of December 2001, national unemployment increased to 5.8% and employment decreased over the year by 1.8 million jobs. The inflation rate rose somewhat during 2001, with an increase in the Consumer Price Index (CPI) of 1.6%.

Wages and benefits grew by 4.1% in the quarter-ended September 2001 compared to same period of the prior year, which was a ten-year high. Although predictions are difficult, most economists project a slow recovery for the economy to begin in the second or third quarter of 2002.

Like the national economy, the Texas economy slowed during the year, although less than at the national level. Texas' largest industries are high tech and oil and gas, and the fastest growing industries are transportation and communications. High tech has experienced the impact of the downturn more than a number of 6ther industries. In addition, Texas is home to three of the nation's niajor airlines, which have been affected greatly as a result of the September 11 tragedy. The full impact of the disaster on the airlines and related industries is not yet fully known. The gross state product (GSP) grew at a slower rate for 2001 than for 2000, though it outpaced the national GDP. GSP grew by 3.4% during 2001. The unemployment rate increased from a nearly three-decade low of 3.8% in January 2001 to 5.7% in December 2001.

Still, Texas ranked third in the nation in the number of new jobs added.

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3,000 u~o 2,500 0

QNet Change, 1990 to 20-01 2,ooo P 1,500 0 o1,o000 z

E 5000 Source-U S. Bureau of Labor Statistics Texas, which is the country's second largest exporting state after California, exports approximately $5,000 of goods for every resident. The Texas economy is expected to grow over the next two years, with GSP growing at about 4% annually. The rate of employment growth Is expected to slow to approximate 2% annually: The Texas economy may not boom, but it is expected to avoid a recession.

As with the national and state economies, the Austin economy experienced a downturn during 2001. The national downturn in

'the high tech industry also affected Austin, and there were a number of job losses in this industry locally. In recent years, Austin has had the lowest unemployment rate in the state; this year saw a change in this measure, as the high tech industry and others experienced layoffs. Austin's unemployment rate rose from a record low of 1.6% in December 2000 to over 4% in 2001. The September 11 disaster affected Austin, with a decrease in airline traffic and tourism, as well as increased costs for

'-homeland defense.

Texas v. Ausin Unemployment 9%

-8%

0-1 Texas M

Ct'f

ý,i 7 %-

Calendar Year Source: Texas Workforce Commission In 2001, Austin experienced an increase in office vacancy rates; occupancy rates decreased from a very tight market at 95%

in 2000 to 81% at the end of 2001.

Retail average occupancy rates remained higher than any other Texas market. The Austin economy is expected to see continued growth over the next several years, though the pace will be much slower than the high growth experienced in recent years.

v Net Jobs Change 1990 to 2001 E

3%

3%

2:

2% -*

IL 1%

0%

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

Life In Austin Austin is now the 1 6th largest city in the country and since 1990, has ranked number one in growth among the 30 largest cities.

Texas' Capital City, Austin is unique and known for its beauty, its dynamic style, and its diverse community. Located in the heart of the Texas Hill Country, the Austin area is blessed with panoramic views, an abundance of rivers and lakes and a climate that is conducive to outdoor activity.

Austin is a great place to enjoy the outdoors. With winter temperatures rarely dipping below freezing and often reaching into the 70's and 80's and with long summers, the city, county and state parks and recreation facilities are busy year-round.

Austin Weather Mean temperature 68 Mean low temperature 58 Mean high temperature 79 Clear days 116 Average rainfall 32 Average days of sunshine 300 Austin is also very fortunate to have a first-rate Parks and Recreation Department (PARD).

In fact, the department is recognized as one of the finest in the country. For the third consecutive year, PARD was nominated for the national Gold Medal Award given by the National Recreation and Park Association. PARD administers a number of public outdoor recreational facilities, including, numerous neighborhood parks, greenbelts, athletic fields, golf courses, tennis courts, a veloway for bicyclists and in-line skaters, miles of hike and bike trails and striped bike lanes, a youth entertainment complex, and swimming pools, including renowned Barton Spnngs, where as many as 300,000 people a year enjoy its constant 68 degree spring-fed water.'

Austin is home to a number of outdoor events, including various art, music, and food and wine festivals; races and bicycle rides; and the nightly flights of the world's largest urban bat colony. A favorite holiday event is the Trail of Lights, a festive, mile-long display of lighted scenes of the holiday season, with more than 200,000 visitors over a two-week period.

In addition to outdoors recreational opportunities, Austinites can choose from a wide variety of indoors recreational activities.

Long recognized as the "live music capital of the world," Austin boasts more than 100 live music venues, and is home to the annual South by Southwest (SXSW) music and film festivals. Austin also has a number of museums, art galleries, an opera facility and a wide variety of restaurants and clubs, especially in the popular Sixth Street and Warehouse District areas.

With its seven institutions of higher learning and more than 90,000 students, education is a significant aspect of life in the Austin area. Access to these institutions, especially the University of Texas at Austin (UT), has attracted many of the high technology industries that have contributed to most of the growth in the city's economy. The largest public university in the nation, UT is known as a world-class center of education and research.

Among U.S. cities with a population over 250,000, Austin is one of the most highly educated cities, with more than 30% of its adults having a college degree and over 88% of the workforce having some college education.

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Industry and Business In 2001, the Austin metropolitan area continued to receive national recognition for its dynamic economy and its quality of life.

'In a summer survey of Fortune 1000 executives conducted by AT Keamey, a global management consulting firm, Austin was named the most likely place to locate a technology-related business or business unit In addition to receiving the top ranking for location, Austin received top honors as the most appealing in the local government involvement category - a category that recognizes local government programs that foster economic growth,-develop the local workforce and address quality of life and economic issues. Austin was also recognized by Employment Review Magazine as the best place to live and work in America. The nationwide review looked at more than 300 metropolitan areas, comparing unemployment rates, projected job growth, cost of living and other data. In its assessment of Austin, the writer states, 'the capital city of Texas deserves a capital

'p' for perfection...Austin has created the perfect blend of work, lifestyle and leisure, making it a true treasure of a city....

Additionally, FORBES magazine named Austin the second best place to do business and advance one's career. - As the capital of Texas and the home of the University of Texas, Austin has long been consid6red a government and university town.

However, Austin is also one'of the premier high-tech communities in the country. Approximately 2,500 technology related "companies employ people in the Austin area. These companies and various other professional service firms make up an important segment of Austin's employment base. The high-tech companies have borne the brunt of the downturn in the economy, with more than 13,000 layoffs during 2001. While government employment is still a stabilizing force in the Austin economy, it now accounts for a much lower percentage of the make-up of Austin's total employment. As the following comparison shows, since 1970, government employment has decreased substantially relative to the other large employment sectors in the Austin area.

"Austin's Changing Employment Profile 40.0%

350%

300%-

o

25 0%

'20 0%

S150%

"o10%-

50%

00%

1970 1980 1990 2000 2001 "Year 0 nGovernment ElServices En Manufacturing Source: Texas Workforce Commission Although Austin's semi-conductor industry has been hit with layoffs and cutbacks, industry analysts indicate the Industry can provide jobs in the future. In preparation for the future, local semiconductor firms contributed funding for scholarships and a facility for training industry workers. The area's large university student population, primarily at the University of Texas, help keep the city intellectually active and provide a valuable resource to companies locating to the area.

With all the features Austin has to offer, the City typically enjoys a strong tourism industry, which has a significant impact on the Austin economy. The City's convention and meeting facilities include the Austin Convention Center, which is expanding to meet increased demand, a soon-to-be open Palmer Events Center, and the Long Performing Arts Center, soon to be under construction, to be built by Arts Center Stage. The number of hotels in the Austin area increased by 23 between 1999 and 2001 to keep up with demand. However, with the September 11 disaster, like many other cities across the country, Austin has experienced a decrease In both tourism and travel, with a 10% drop in hotel occupancy in November and 20% drop in airport passenger traffic in December, compared to the same periods in 2000. Fortunately, Austin may be less vulnerable to the effects of reductions in air travel because more than half of the City's visitors come from other Texas cities.

vii

The Accounting System and Budgetary Control The Financial Services Department is responsible for providing all centralized City financial services including financial accounting and reporting, payroll'and accounts payable disbursement functions, cash and investment management, debt management, budgeting, purchasing, contract administration, regulatory affairs, and special financial and policy analyses for City managemenL The Director of Financial Services, appointed by the City Manager, supervises the department's operations.

The City employs a computerized financial accounting system that includes a system of internal accounting controls. These controls have been designed and are continually being re-evaluated to provide reasonable, but not absolute, assurance for the safeguarding of assets against loss from unauthorized use or disposition and the reliability of financial records for preparing financial statements and maintaining accountability for assets.

The concept of reasonable assurance recognizes that the cost of a control should not exceed the benefits likely to be derived and the evaluation of costs and benefits requires estimates and judgments by management. All internal control evaluations occur within this framework and are believed to adequately safeguard assets, and provide reasonable assurance of proper recording of financial transactions.

Accounting records for governmental fund types are maintained on a modified accrual basis, i.e., revenues are recorded when available and measurable and expenditures are recorded when services or goods are received and the liabilities are incurred.

Accounting records for proprietary fund types and similar trust funds are maintained on the accrual basis.

The annual operating budget, or financial plan, is proposed by the City Manager and enacted by the City Council after public discussion.

Subsequent intradepartmental budget transfers must be approved by the City Manager.

Interdepartmental transfers and any increase or decrease in total appropriations must be approved by the City Council. Management control for the operating budget is maintained at the fund and department level.

New Reporting Model The City will implement the new financial reporting model, Governmental Accounting Standards Board Statement No. 34, Basic Financial Statements - and Management's Discussion and Analysis - for State and Local Governments in fiscal year 2002.

Nonexchange Revenues The City adopted Governmental Accounting Standards Board Statements No. 33 Accounting and Financial Reporting for NonexchangeTransactons and No. 35 Recipient Reporting for Certain Shared Nonexchange Revenues-an amendment of GASB Statement No. 33 during fiscal year 2001.

The statements call for the recognition of revenue for nonexchange transactions, such as hotel-motel occupancy taxes, when the underlying transaction takes place. Implementation of these statements resulted in increases in the 2000 and 2001 ending fund balances for the following two funds: Hotel-Motel Occupancy Tax fund ($7.6 million and $5.8 million, respectively) and Vehicle Rental Tax fund ($1.5 million and $1.2 million, respectively). These adjustments change the timing of reporting the revenues, and do not increase the cash available for appropriation.

viii

General Fund The City's General Fund is used to account for expenditures for traditional governmental services as well as all financial resources other than those required to be accounted for in other funds. Sources of revenue for this fund are widely diversified and include property tax, sales tax, transfers from the City-owned utility system, and other sources as shown below:.

General Fund Sources Fiscal Year 2001 Sales Taxes Property Taýes Other Financing Franchise Fees Licenses, inspections Fines, Forfeitures Interest and Other CQarges for ServiceslGoods Other Taxes 300%

150%

1D 0%

5.0%

00%

General Fund expenditures were, as follows:

.1

-

ix 20.0%

25 0%

General Fund Uses Fiscal Year 2001 Rublic Safety" Nondepartnrntal Riblic Health Riblic Recreation & Culture Public Service & Ublties Operating Transfers Urban Growth Managenent Social Services Adrrinistration 25.0%

30'0%

35'0%

40ol%

45.'0%

50b%

100%

'10%

-200%

0.0%

5.0%

'I Elt

Below is a summary of General Fund sources and uses of funds for fiscal years 2001 and 2000:

General Fund Sources and Uses (Dollars In Millions)

Increase 2001 2000 (Decrease)

SOURCES OF FUNDS Property taxes 124.93 11533 960 8

Sales taxes 12322 122.16 1 06 1

Other taxes 360 3.18, 042 13 Franchise fees 31.45 23.70 7.75 33 Fines, forfeitures, and penalties 17.00 16.04 096 6

Licenses, permits, and inspections 17 63 18.17 (0 54)

(3)

Charges for services, goods 14 99 11.76 323 27 Interest and other 1058 9.41 1.17 12 Transfer and other sources 86 28 78.35 7 93 10 Total 429.68 398.10 31.58 8

USES OF FUNDS Administration 9.43 8 98 045 5

Urban growth management 11 57 10.19 138 14 Publc safety 21028 191.59 1869 10 Public services and utilities 9 52 6.10 342 56 Public health 41.44 41.03 041 1

Public recreation and culture 47.45 44.20 3 25 7

Social services management 807 9 39 (1 32)

(14)

Nondepartmental expenditures 5786 53.46 440 8

Operating transfers out 2999 31.29 (1.30)

(4)

Total 425.61 396.23 29.38 7

Increase(decrease) in fund balance 4 07 1.87 2 20 118 Total fund balance, beginning of year 44.51 42.39; 2.12 5

Residual equity transfers in (out)

(0 50) 0 25 (0.75) 0 Total fund balance, end of year 48.08 44.51-3.57 8

Exclusive of transfers to/from emergency and contingency reserves.

For the year ended September 30, 2001, revenues on a budget basis were $.7 million more than amended budget This amount is the net of revenues in excess of and below budget Amounts in excess of budget were franchise fees ($3.5 million),

fines, forfeitures and penalties ($.3 million), licenses, permits and inspections ($.7 million), goods/services ($2.5 million), and interest and other ($1.6 million); revenues less than budget were taxes ($7.8 million): Expenditures on a budget basis were

$9.8 million lower than amended budget, with significant savings achieved by public safety ($5.3 million), urban growth management ($1.4 million) and social services management ($1.2 million). Overall, the General Fund stayed within the amended budget and maintained emergency reserves of $15 million and contingency reserves of $367,000.

Special Revenue Funds The special revenue funds include the Federal grant funds, State grant funds, other special revenue grant funds and other special revenue funds, which include the Hotel-Motel Occupancy Tax Fund and the Housing Assistance Fund. Collectively, these funds expended $112 million during 2001.

x

The grant programs have an important effect on the Austin community by allowing the City to operate community centers, provide services to the elderly, provide health services to women and children, enhance public safety activities, and provide assistance in construction of capital improvements.

In 2001, the Hotel-Motel Occupancy Tax Fund transferred $3.6 million to the' Parks :and Recreation Depadtment Cultural Projects Fund for cultural arts programs, $15.6 million to the Convention Center Tax Fund, $6.9 million to the Town Lake Park NVenue Project Fund anaJ $5 million to the Tourism and Promotion Fund for promotion of the tourism indu-stry.

General Obligation Debt Administration

'The Cit`:maintains a separate fund, the GeIneral Obligation Debt Service Fund, to administer debt'associated with its g6neral obligation bonds, certificates of obligation, contractual obligations, and other tax-supported debt. A separate ad valorem tax is levied and collected to provide funds to retire such debt issued for general government capital projects (debt service on deneral obligation debt issued for proprietary fund ca'p-ital projects is- -paid from related proprietary fund revenues): For 2001, this tax was $.1652 per $100 assessed valuation.

The fund balance iesignated for'general obligation debt service at'September 30, 2001, was $16.47 million or 20% of 2001 budget-basis debt service expenditures. At September 30, 2001, the City had $563 million in tax-supported general obligation bonds,.certificates of obligation, contractual obligations, and other tax-suppoirted -debtfoutstanding (not including amounts supported by proprietary funds)

Authorized but unissued general obligation bonds at September 30, 2001 totaled $435.2 million."

The ratio of net bonded debt to assessed valuation and the amount of bonded debt per capita for 2001 and 2000 are shown below.,

2001 2000 Net bonded debt

$546,210,746

$540,282,278 Ratio of debt to assessed value 1.32%

1.52%

Debt per capita

$825.54

$859.41 Assessed valuation (000's)

$41,419,314

$35,602,840 Debt service tax rate per

"$100 assessed valuation

$0.1652

$01812

'The City's outstanding general obligation debt is rated Aa2 (Moody's Investor Services, Inc.), AA+ (Standard & Poor's) and AA+ (Fitch).

In addition to the General Obligation Debt Service Fund, the City maintains a separate fund for U.S. Housing and Urban Development (HUD) Section 108 Loans.

',I xi Special Revenue Funds Federal grants

$38,019,169 State grants 3,844,744 Other special revenue grants 443,558 Other special revenue funds 58,430,016 Housing Assistance Fund 11,324,603 Total Expenrditures

$112,062,090

Capital Projects Funds The City maintains capital project funds to account for general government capital improvements, which are funded primarily by general obligation bond proceeds, transfers from other funds, interest income and intergovernmental revenues. When projects are completed, they are recorded-as additions to the General Fixed Asset'Account Group. Capital projects for proprietary funds that use general obligation bonds as a funding source (primarily the Airport and Solid Waste Services) are accounted for within the enterprise or internal service funds rather than within the capital projects funds.

During 2001, a total of $105.4 million was expended in the capital project funds, primranly for street, traffic signal and drainage improvements; general improvements; fire facilities; and land purchases. At September 30, 2001, total fund balance was

$122.9 million consisting of a reserve for encumbrances of $79.2 million and an unreserved balance of $43.7 million.

Utilities The City owns and operates its electric, water, and wastewater systems and issues revenue bonds for the majority of its capital expenditures for these facilities. The utilities have issued combined utility system prior lien, subordinate lien and separate lien revenue bonds. At September 30, 2001, the Combined Utility System revenue bonds were rated, as follows:

prior lien A2 (Moody's Investor Services, Inc.), A (Standard andPoor's), and A+ (Fitch) and subordinate lien A2 (Moody's Investor Services, Inc.), A- (Standard and Poor's) and A+ (Fitch). The electric separate lien bonds were rated A3 (Moody's Investor Services, Inc.), A- (Standard & Poor's) and A (Fitch). The water and wastewater separate lien bonds were rated A2 (Moody's Investor Services, Inc.), A- (Standard & Poor's) and A+ (Fitch).

At September 30, 2001, authorized but unissued revenue bonds totaled $562 million for electric projects, $535.6 million for water projects, and $394.7 million for wastewater projects. Activity relating to revenue bonds is summanzed in the following table (in thousands of dollars):

Water and Electric Wastewater Description, Prior Lien Subordinate Separate Separate (Net of discount and Inclusive of premium)

Bonds Lien Bonds Lien Bonds Lien Bonds Total Balance payable. October 1, 2000

$1,950,526 323.587 100,015 2,374,128 Debt issued 126,944 225,809 352,753, Debt repaid, defeased, or refunded (64,592)

(36,765)

(101,357)

Amortization of bond discount and premium 1,681 (272) 4 5

1,418 Balance payable, September 30, 2001

$1,887,615 286,550 126,948 325,829 2,626,942 The Electric Fund and the Water and Wastewater Fund transferred $67.3 million and $18.5 million, respectively, to the General Fund in 2001.

Electric Fund Electric operating revenues for 2001 were $806 million, an increase of 3% over the prior year. Operating expenses before depreciation for 2001 were $459 million, an increase of 9% from the prior year.

Water and Wastewater Fund The City owns and operates three water treatment plants with an average daily consuri*ption of 121 million gallons per day (mgd) and four wastewater treatment plants with an average daily volume of 94 mgd. The City also owns and operates its own distribution and collection systems.

Total Water and Wastewater operating revenues for 2001 were $220 million, a decrease of 9% under the prior year.

Operating expenses before depreciation for 2001 were $102 million, an increase of 6% over the prior year.

xii

The City has certain contractual commitments with several municipal utility districts (MUDs) for the construction of certain additions, improvements, and extensions of the City's water and wastewater delivery systems. These MUDs are authorized to issue contract revenue bonds to finance the construction of such improvements. The City will become the owner of these improvements when they are completed or if the City annexes the MUDS. Upon completion or annexation the City~will make

-debt service payments on the MUDs' portion of the bonds., This arrangement will enable the City' to expand its system in a manner that prevents the proliferation of stand-alone' utilities, which would ultimately need to be integrated into a regional system upon annexation.

The City has annexed MUDs that have issued and outstanding $64.7 million City of Austin,' Texas, Contract Revenue Bonds as of September 30, 2001.

North Austin MUD No. 1, which has not been annexed, had issued and outstanding $12 million City of Austin, Texas, Contract Revenue Bonds as of September 30, 2001. The total City of Austin, Texas, Contract Revenue Bonds outstanding at September 30, 2001 is $76.7 million.

Airport Fund The Airport Fund accounts involve the operation of the Austin-Bergstrom International[ Airport (ABIA)." The ABIA is self sustaining, providing for operating expenses including depreciation, an amount equivalent to the airport's interest on debt, payment for support services from other City departments, and funding of capital improvement projects. Operating revenues for the year ended September 30, 2001, were $68.5 million. After deducting operating expenses of $54.5 million, the airport

-had operating income of $14 million and net income of $16.3 million. Fiscal year 2001 beginning retained earnings of the Airport fund were'reduced by $2.5 million for a liability identified after fiscal,ear 2000.

Effective November 1, 1993, the Airport Fund began to charge each enplaned passenger a $3 passenger facility charge, as allowed by the Federal Aviation Administration. The Airport Fund's 2001 operating revenues included passenger facility charges of $10 million, which are dedicated to debt service payments for the Austin-Bergstrom International Airport.

Austin Airline Traffic at ABIA and Robert Mueller 4,000 3,500 3,000 2,000 4*

4 2,5000 -

21500 LuJ 1,000 0

1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000" 2001 Fiscal Years WEnlaned Passenners Cash Management Cash balances of all City funds are Invested in consideration of five factors: safety, term, liquidity, market exposure, and rate of return. Cash balances of most funds, except the debt service and revenue bond retirement reserve, are pooled for investment purposes. These investments are made in accordance with the Texas Public Funds Investment Act and the City of Austin Investment Policy, and are restricted primarily to obligations of the United States, the State of Texas, the County, the City, certificates of deposit insured by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation, local government investment pools, bankers' acceptances, prime commercial paper, money market mutual funds, share certificates issued by the National Credit Union Share Insurance Fund, and fully collateralized direct and reverse repurchase agreements meeting the requirements of the above-mentioned statutes.

During 2001, the City's cash resources were primarily invested In U.S. Treasury and Agency issues. The average yield on pooled investments during the year was 5.7%.

xiii

Risk Management The City is exposed to employee-related riski for health benefits and workers' compensation, as well as to various risks of loss related to torts, including medical malpractice; theft of, damage to, or destruction of assets; errors and omissions; and natural disasters. The City continues to be self-insured for liabilities for most health benefits, third-party claims, and workers' compensation. The City purchases commercial insurance for coverage for property loss or damage, commercial &rime, fidelity bond, and airport operations., In addition, the City purchases a broad range of insurance coverage for contractors working at selected capital improvement project sites. The City does not participate in a risk pool.

The City uses intemal service' funds to account for risks related to health 'benefits, third-party liability, and workers' compensation, as well as for resources for these risks. Liabilities are reported when it is probable that a loss has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated. Liabilities include an amount for claims that have been incurred but not reported (IBNR).

Claim liabilities for the Employee Benefits Fund are calculated considering recent claim settlement trends; liabilities for the Liability Reserve and Workers' Compensation funds are calculated based on outstanding claims.

Acknowledgments The preparation of this report'on a timely basis could not have been accomplished without the dedicated services of a highly qualified staff. The City of Austin has such a staff in the Controller's Office of the Financial Services Department. We would like to express our appreciation to all the staff of the Controllers Office who assisted in and contributed to the preparation of this report.

Other departments and offices'of the City have also contributed directly or indirectly to the preparation of this report.

In particular, the Budget Office of the Financial Services Department and the Office of the City Auditor have been instrumental in ensuring that good financial management practices are maintained, and their cooperation and continued assistance is appreciated. We also acknowledge the efforts of the City departments in following good financial management practices and in providing information and assistance during the preparation of the report.

We acknowledge the thorough, professional, and timely manner in which the audit was conducted by our independent auditors, KPMG LLP and Richard Mendoza, CPA.

Finally, we acknowledge the Mayor and Council Members who have consistently supported the City's goal of excellence in all aspects of financial management. Their support is greatly appreciated.

esus Garza City Manager Jci(V Stephens, CPA D ;ctor, Financial and Administrative Services xiv

City of Austin, Texas ORGANIZATIONAL CHART C[tyClerk-CityManager City

&iio BoardsWand Xv

The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Austin, Texas for its Comprehensive Annual Financial Report for the Fiscal Year Ended September 30, 2000.

In order to be awarded a

Certificate of Achievement, a

governmental unit must publish an easily readable and efficiently organized Comprehensive' Annual Financial Report, whose contents conform to program standards.

Such reports must satisfy both generally accepted accounting principles and applicable legal requirements.

A Certificate of Achievement is valid for a period of one year only.

City management believes that this 2001 CAFR conforms to the Certificate of Achievement Program requirements, and we are submitting it to GFOA for their review.

Certificate of Achievement for Excellence in Financial Reporting Presented to City of Austin, Texas For its Comprehensive Annual Financial Report for the Fiscal Year Ended September 30, 2000 A Certificate of Achievement, for Excellence in Financial Reporting Is presented by the Government Finrance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards In government accounting and financial reporting.

Pculdent Y ExecutieDrco xvi I-

FINANCIAL SECTION

rVINO ZA 111 C*u~s Aw "Certied PublkAccounlait Auaetl 78xl INDEPENDENT AUDITORS' REPORT The Honorable Mayor and Members of the City Council, City of Austin, Texas:

We have audited the general purpose financial statements of the City of Austin, Texas ("City") as of and for the year ended September 30, 2001, as listed in the accompanying table of contents under "General Purpose Financial Statements" and the following Individual fund supporting financial statements included in Exhibit F-1, Exhibit F-2, and Exhibit F-3: Electric Fund Balance Sheet, Electric Fund Statement of Revenues, Expenses, and Changes in Retained Earnings, Electric Fund Statement of Cash Flows, Water and Wastewater Fund Balance Sheet, Water and Wastewater Fund Statement of Revenues, Expenses, and Changes in Retained Earnings, Water and Wastewater Fund Statement of Cash Flows, Airport Fund Balance Sheet, Airport Fund Statement of Revenues, Expenses, and Changes in Retained Earnings, and Airport Fund Statement of Cash Flows. These general purpose financial statements and individual fund supporting financial statements listed above are the responsibility of the City's management. Our responsibility Is to express an opinion on these general purpose financial statements and individual fund supporting financial statements listed above based on our audiL We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements and individual fund supporting financial statements listed above are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements and individual fund supporting financial statements listed above. An audit also includes assessing the accounting pnnciples used and significant estimates made by management, as well as evaluating the overall financial statement presentation and the presentation of the individual fund supporting financial statements listed above. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Austin, Texas as of September 30, 2001, and the results of its operations and cash flows of its proprietary fund types and similar trust funds for the year then ended in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the individual fund supporting financial statements referred to above present fairly, in all material respects, the financial position of each of the individual funds as of September 30, 2001, and the results of operations and the cash flows of such funds for the year then ended in conformity with accounting principles generally accepted in the United States of America.

Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole and on the individual fund supporting financial statements referred to In the first paragraph. The accompanying combining, individual fund and Individual account group financial statements and schedules, other than those referred to in the first paragraph, and schedules of general obligation bonds authorized and unissued and revenue bonds authorized, deauthorized, and unissued, as listed under "Supplemental Information" in the accompanying table of contents are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the City of Austin, Texas.

Such information, other than those individual fund supporting financial statements referred to in the first paragraph, has been subjected to the auditing procedures applied In the audit of the general purpose financial statements and, in our opinion, is fairly stated in all material respects in relation to the general purpose financial statements taken as a whole. The schedules listed under "Statistical Section" In the accompanying table of contents were not audited by us, and, accordingly, we express no opinion on them.

K<PMcwT LIM44Ac Austin, Texas January 18, 2002 xvii

This page intentionally blank.

xvidi I

COMBINED FUNDS

ALL FUND TYPES AND ACCOUNT GROUPS COMBINED BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 ASSETS AND OTHER DEBITS Current assets:

Cash Pooled investments and cash Investments, at fair value Working capital advances Cash and investments held by trustee Receivables, net of allowances:

Property taxes Accounts and other receivables Receivables from other governments Due from other funds Inventones, at cost Real property held for resale Other assets Total current assets Restricted assets:

Revenue note current debt service account Revenue bond current debt service account Revenue bond future debt service account Revenue bond retirement reserve account Construction account Due from other funds Advances to other funds Decommissioning account Capital improvement account Operating reserve account Hotel occupancy tax account Renewal and replacement account Investments and cash held by trustee Nuclear fuel inventory acquisition account Mueller disposition account Customer and escrow deposits Other restncted accounts Total restricted assets Fixed assets, at cost:

Property, plant and equipment Less accumulated depreciation Net property, plant and equipment Investment in municipal utility districts Intangible assets, net of amortization Other long-term assets Deferred costs and expenses, net of amortization Other debits:

Amount available in debt service funds Amount to be provided for accrued compensated absences Amount to be provided for retirement of long-term debt Total assets Governmental Fund Types Special Debt Capital General Revenue Service Projects 87,388 6,835 246 35,120.932 57,155,129 127,703,177 903,585 16.344,051 4,445,274 3,072,010 27,849,270 16,982,963 2,384,375 10,477,094 13,689,040 7,997,755 1,522,969 259,336 4,290,745 273,011 930,616 839,748 69,298.844 104.695.343 19,416,307 138,925,055

$ 69,298,844 104,695.343 19.416,307 138,925.055 The accompanying notes are an integral part of the financial statements.

2

CITY OF AUSTIN, TEXAS Exhibit A-1 Proprietary Fund Types Internal Fiduciary Fund Types Trust and Account Groups General Fixed General Long-Totals (Memorandum Only)

Enterprise Service Agency Assets Term Debt 2001 2000 44,300 22,875 161,644, 195,563 133,857,198 53,308,192 8,112,717 415,257,345 341,916,193 17,247,636 10,461,177 3,014,635 3,014,635 2,548,202 292,073 292,073 198,423 7,517,284 7,567,074 135,001,019 321,341 182,538,968 211,976,161 128,894 10,605,988 15,066,423 150,000 21,836,795

-33,218,120 48,991,431 1,668,318 52,442,054 50,021,832 S-.....

4,290,745

-1,923,982 27,798,023 295,823

.- 30,137,221.

66,596,625 348,856.606 55,908,622 8,241,611 745,342,388 741,689,775 392.997 392,997 441,867 134,089,286 134,089,286 118,709,645 192,196,078 192,196,078 221,753,105 177,614,370 177,614,370 168,178,520 325,032,405 1,885,414 326,917,819

-376,567,991 26,872 26,872

, _-o 384.424 4,559,850

-59,850

-'4,586,722 72,591,362 72,591,362 63,515,224 34,547,866 34,547,866 15,485,262 6,900,950 6,900,950 -

17,509,286 572,788

-72,788 2,076,499 11,063,999

,11,063,999 11,043,578 5,213,934 5,213,934 20,393,686 31,898,253 31,898,253 33,473,935 5,778,587 5,778,587,

-2,616,040 7,325,312 7,325,312 12,199,305 14,153.590 14,153,590 10,156,981 1,023,958,499 1,885,414 1,025,843,913 1,079,092.070 6,494,638,304 77,773,612 734,191,487 7,306,603,403 6,775,627,049 (1,944.774,595)

(26,697,015)

(1,971,471,610)

(1,822,117,652) 4,549,863,709 51,076,597 734,191,487 5,335,131,793 4,953,509,397 1,756,084 1,756,084

'2,107,665 95.101,582 95,101,582 97,500,000 3,969,980 3.969,980%,

1,326,942 634,789,800 8,404 634,798,204 641,821,907 16,467,130 16,467,130 9,756,704 49,412,297 49,412,297' 47,885,622 566.110,732 566,110,732 553,810,692 6,658,296,260

, 108,879,037

,.8,241,611 734,191,487 631,990,159 8,473,934,103 8,128,500,774 S(continued) 3

ALL FUND TYPES ANDACCOUNT GROUPS COMBINED BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 LIABILITIES, EQUITY AND OTHER CREDITS Current liabilities:

Accounts payable Accrued payroll Accrued compensated absences Claims payable Construction contracts payable Contract revenue bonds payable Due to other governments Due to other funds Interest payable on other debt General obligation bonds payable and other tax supported debt Water improvement district bonds payable Capital lease obligations payable Deferred revenue and other liabilities Total current liabilities Liabilities payable from restricted assets:

Accounts and retainage payable Accrued interest payable General obligation bonds and other tax supported debt payable Revenue bonds payable within one year Capital lease obligations payable Decommissioning expense payable Nuclear fuel expense payable Other liabilities Total liabilities payable from restricted assets Long-term obligations, net of current portion:

Accrued compensated absences Claims payable Construction contracts payable Contract revenue bonds payable, net of discount Advances from other funds Loans payable Capital appreciation bond interest payable Commercial paper notes payable Revenue notes payable General obligation bonds payable and other tax supported debt, net of discount and inclusive of premium Revenue bonds payable, net of discount and inclusive of premium Water improvement district bonds payable Capital lease obligations payable Decommissioning assessment payable Accrued landfill closure and postclosure costs Deferred revenue and other liabilities Total liabilities Governmental Fund Types Special Debt Capital General Revenue Service Projects 5,586,536 4.690,171 7,072,545 5,798,262 268,918 2.774.177 192.714 13,839,040 7,994,095 7,059,278 46,022,257 2,949,177 929,415 21.218,253 65,013,100 2,949.177 15.996.055

$ 21.218,253 65,013.100 2,949.177 15,996.055 The accompanying notes are an integral part of the financial statements 4

CITY OF AUSTIN, TEXAS Exhibit A-I (Continued)

Proprietary Fund Types Internal Enterprise Service Fiduciary

-Fund Types Trust and Agency SAccount Groups General Fixed General Long

'Assets Term Debt Totals (Memorandum Only) 2001 2000 70,348,995 4,260,772 10,888,218 204,041 6,605,000 5.210,331 2,953,607 250.000 2,286,614 5,015,021 1,735,063 4,055.853 14,101,232 26,872 70,899 1,058,294 42,177 1,587,256 3,660 92,755,445 12,063,015 17.910,962 14,101,232

'-204,041 6,605,000 1,587,256 21,863,667 5,281,230 4,011,901 250.000 2,286,614 100,063,130 9,638,871 18,378,165 13,747,986 1,074,032 6,930,000 1,310,591 33,602,544 6,392,313 3,906,398 366,000 2,100,001 7.863,588 1,000,451 3,198.822 69,022.988 63,425,716 110.871.166 27.063,685 4,831.915 247,943.351 260,935.747 46,646.854 46,646.854 40,191.049 71,024,255 71,024,255 62,027,168 5,045,853 5,0.45,853 3,688,803 105,220.662 105,220,662 104,302,365 7,500.000 72,591,362

'72,591.362 63,515,224 31,898,253 31,898,253 33,473,935 10,970,414 10,970.414 11,954,008 343,397,653 343,397,653 326,652.552 8,106,045 2,466,758 49,412,297 59,985,100 56,381,438 9,416,434 9,416,434 8,378,102 75,000 75,000 75,000 69.858,104 69.858,104 88,254.611 241,850 4,318,000 4,559,850 4,586,722 11,208,126 11,208,126 9.210.660 145,060,818 145,060,818 128,547,946 228,468.720 228,468,720 403,255,427 28,000,000 28,000,000 28,000,000 61,855,982 4,917,785 562,677,630 629,451,397 623,286,293 3,125,935,659 3,125,935,659 2,875,791,298 423,000 16,636.520 16,636,520 17,534,999 1.703,648 1,703,648 1,976,937 6,904,024 6.904,024 6,700,886 42,636,780 4,374,106 47,010,886 9,233,172 4,189.510,119 44,106,512 4,831,915 631,990,159 4,975,615,290 4,849,224,790 (continued) 5

ALL FUND TYPES AND ACCOUNT GROUPS COMBINED BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 LIABILITIES, EQUITY AND OTHER CREDITS Continued Equity and other credits:

Contributions from municipality Contributions from State and Federal governments Contributions in aid of construction Contributions from the pnvate sector Investment In general fixed assets Retained earnings:

Reserved for renewal and replacement Reserved for passenger facility charge Unreserved Fund balances:

Reserved Encumbrances Inventones and prepaid items Notes receivable Real property held for resale Nonexpendable trust Emergencies Contingencies Unreserved:

Designated for future use Designated for debt service Designated for purposes of trust Undesignated Total equity and other credits Total liabilities, equity and other credits Governmental Fund Types Special Debt Capital General Revenue Service Projects 6.460.867 3.276,115 79.211.890 1.795.980 259,336 3,441,706 4,290,745 15,000.000 366,953 539,613 29,247.723 16,467,130 23.917,178 (833.382) 43,717.110 48.080,591 39.682,243 16,467,130 122,929,000

$ 69,298,844 104,695,343 19,416,307 138,925,055 The accompanying notes are an integral part of the financial statements 6

SCITY OF AUSTIN, TEXAS SExhibit A-1 (Continued)

Proprietary Fund Types Internal Enterprise Service 56,252.909 53,464,798 162,967.116 394,672,524 4,175,344

--11,063,999

-11,909,161 1,827,745,088 Fiduciary Fund Types Account Groups Trust and General Fixed General Long SAgency Assets Term Debt 734,191,487 11,307,727 Totals (Memorandum Only) 2001 2000 109,717,707 102,259,366 162,967,116 167,117,885 394,672,524 410,144,687 4,175,344 4,175,344 734,191,487 669,969.579 11,063,999 11,065,953 11,909,161 10,152,485 1,839,052,815 1,680,670,900 88,948,872 2,055,316 3,441,706 "4,290,745 1,040,217 15,000,000 366,953 1,040,217 62,693,897 1,824,251 5,040,609 1,923,982 1.040,217 17,658,310 615,422

• 29.787,336 33,760.268 "16.467,130 9.756,704 2,369,479 2,369,479 4,224,460 66,800,906 85,181,665

- 2,468.786,141 64.772,525 -

3,409,696 734,191,487 3,498,318,813 3,279,275,984 "6,658,296,260 108,879,037 8,241,611 734,191,487 631,990,159 8,473,934,103 8,128,500,774 7

ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 REVENUES Taxes Franchise fees Fines, forfeitures and penalties Licenses, permits and inspections Charges for services/goods Intergovernmental revenues Property owners! participation and contributions Contributions to trusts Interest and other Total revenues EXPENDITURES (1)

Current:

Administration Urban growth management Public safety Public services and utilities Public health Public recreation and culture Social services management Nondepartmental expenditures Special projects Capital outlay for construction Debt service:

Principal retirement Interest, commissions and other Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES)

Proceeds of refunding bonds Payment to escrow agent Proceeds from issuance of general obligation bonds and other tax supported debt Operating transfers in Operating transfers out Total other financing sources (uses)

Excess (deficiency) of revenues and other sources over expenditures and other uses Fund balances at beginning of year Adjustment for a change In accounting principle Fund balances at beginning of year, as restated Residual equity transfer in (out)

Fund balances at end of year Governmental Fund Types Special Debt General Revenue Service

$ 251,749,818 36,178,201 68.639,520 31.452.706 16,999.766 4,184,809 17,630.897 14,984,531 22,836,690 42,307.471 10,584.063 22.076,579 3,101.822 343,401,781 127,583,750 71.741.342 9,425,506 58.430,016 11,569,463 210,280,836 9,519,936 41,437,116 47,459,639 8,071,026 57,857,261 53,632,074 44,550.106 30,295,459 395,620.783 112.062,090 74,845,565 (52,219,002) 15,521,660 (3,104,223) 110,583,444 (110,563.444) 86,282,962 39,320,803 9,814,649 (29,992,440)

(59,736,704) 56,290.522 (20,415,901) 9,814,649 4,071,520 (4.894,241) 6.710,426 44,509,071 35,070,972 9,756,704 9,070,655 44,509,071 44,141,627 9,756,704 (500.000) 434,857

$ 48.080,591 39,682,243 16,467,130 (1) Expenditures include capital outlay of $2,432,283 in the General Fund,

$668,248 in the special revenue funds, and $213,506 in the expendable trust funds.

The accompanying notes are an integral part of the financial statements.

8

CITY OF AUSTIN, TEXAS Exhibit A-2 Fiduciary FundType Capital Expendable Projects Trust 8,961,227 11,439,828 11,963,968 32.365.023 720273 189.359 909.632 Totals (Memorandum Only) 2001 2000 356,567,539 341,986,742 31,452,706 23,699,065 21,184,575 20,024,670 17,630,897 18,173,885 37,821,221 43,227,549 51,268,698 44,973.932 11,439,828 9,508.185 _

720,273 337,735 47,915.791 36,906,538 576.001.528 538,838,301 67,855,522 65,875,366 11,569,463 10,188,934 20,676 210,301,512 191,614,923 11,773 9,531.709 6,129,315 41,437,116 41,037,563 2.521,381 49,981,020 44,429,880 8.071,026 9,387,107 57,857,261 53,458,609 53,632.074 39,230,221 105,423,588 105,423,588 99,863,556 44,550,106 27,220,117 30,295,459 42,460,582 105,423,588 2,553.830 690,505,856 630,896,173 (73,058,565)

(1,644,198)

(114,504.328)

(92,057,872) 110,563,444 (110,563.444) 58.990,000 58,990,000 59,330,000 41,854,349 1,000,000 178,272,763 139,301,402 (24,904.490)

(173,580)

(114,807,214)

(79.355,042) 75,939.859 826.420 122,455,549 119,276,360 2,881,294 (817.778) 7,951221 27,218,488 120,047,706 4,224,460 213,608,913 187,793,677 9,070,655 7.806,558 120,047,706 4,224,460 222,679,568 195,600,235 (1,037,203)

(1.102,346)

(139.155) 122.929,000 2.369,479 229,528,443 222,679.568 9

GENERAL FUND, SPECIAL REVENUE FUNDS AND DEBT SERVICE FUND COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL-BUDGET BASIS Year ended September 30, 2001 General Fund Variance Favorable Budqet (Unfavorable)

Annually Budgeted Special Revenue Funds Actual-Variance Budget Favorable Basis Budget (Unfavorable)

REVENUES Taxes Franchise fees Fines, forfeitures and penalties Licenses, permits and inspections Charges for services/goods Interest and other Total revenues EXPENDITURES Administration Urban growth management Public safety Public services and utilities Public health Public recreation and culture Social services management Nondepartmental expenditures Pnncipal retirement Interest and other Fees and commissions Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES)

Operating transfers in Operating transfers out Total other financing sources (uses)

Excess (deficiency) of revenues and other sources over expenditures and other uses Fund balances at beginning of year Fund balances at end of year

$ 251,749,818 259,543,305 (7,793,487) 31,452,706 28,002,200 3,450,506 16,999,766 16,684,955 314,811 17,630,897 16,953,748 677,149 13,724,721 11,262,833 2,461,888 10,584,063 8,957,902 1,626,161

-74.703,323 70,953.424 3,749.899 342,141,971 341,404,943 737,028 74,703,323 70.953,424 3.749.899 9,422.061 9,757,764 335,703 55,433,485 57,906,326 2,472,841 11,611.673 13,028,116 1,416,443 212,694,718 217,975,633 5,280,915 9,681.985 10,111,779 429,794 41,634,578 42,067,305 432,727 47,783,963 47,973,830 189,867 7,296,906 8,517,380 1,220,474 9,007,839 9,476,990 469,151 349,133,723 358,908,797 9,775,074 55,433,485 57,906,326 2,472,841 (6,991,752)

(17,503,854) 10,512,102 19,269,838 13,047,098 6.222,740 93,697,676 92,882,676 815,000 39,123,803 39,061,313 62,490 (81,948.329)

(85,674,400) 3,726,071 (61,071,665) (58,852,169)

(2,219,496) 11,749,347 7,208.276 4.541.071 (21,947.862) (19,790.856)

(2,157.006) 4,757,595 (10,295,578) 15,053,173 (2,678,024)

(6,743,758) 4,065,734 39,205,196 10,315,578 28,889,618 12,275,160 5,621,098 6,654,062

$ 43,962,791 20,000 43,942,791 9,597.136 (1,122,660) 10,719,796 The accompanying notes are an integral part of the financial statements.

10 Actual Budget Basis

CITY OF AUSTIN, TEXAS Exhibit A-3 Debt Service Fund

• Actual-Variance

" Budget Favorable Basis Budget -

(Unfavorable) 68,639.520 68,515,476 3,101.822 3,032,846 71,741,342 71,548,322 50,813,885 48,123,885 32,728,200 36,669.300 136 1.0 Totals (Memorandum Only)

Actual-Variance Budget Favorable Basis Budget (Unfavorable) 124,044 320,389,338 328,058,781 (7,669,443) 31,452,706 28,002,200 3,450,506 16,999,766 16,684,955 314,811 17.630,897 16,953,748 677,149 13,724,721 11,262,833 2,461,888 68.976 88,389,208 82.944,172 5.445,036 193.020 488,586,636 483,906,689 4,679,947 64,855,546 67,664,090 11,611,673 13,028,116 212,694,718 217,975,633 9,681,985 10,111,779 41,634,578 42,067,305 47,783,963 47.973,830 7,296,906 8,517,380 9,007,839 9,476,990 (2,690,000) 50,813,885 48,123,885 3,941,100 32,728,200 36,669,300 (3.962) 13,962 10,000 2,808,544 1.416,443 5,280,915 429.794 432,727 189,867 1,220,474 469,151' (2,690,000) 3,941,100

" (3,962) 83,556.047

- 84,803,185 1.247,138 488.123.255 501,618,308 13,495.053 (11,814,705)

(13,254,863) 1,440,158 463,381 (17,711,619)

. 18,175,000 18,525,131 12,264,564 6,260,567 151,346,610 144,208,553 7,138,057, (143,019,994)

(144,526,569)

-1,506,575 18,525,131 12,264,564 6,260,567 8,326,616 (318,016) 8,644,632 "6,710,426 (990,299) 7,700,725 8,789,997 (18,029,635) 26.819.632 9,756,704-9,350,509 406,195 61,237,060 25,287,185 35,949,875 16,467,130 8,360,210 8.106,920 70,027,057 7,257,550 62,769,507

'11 v

ALL PROPRIETARY FUND TYPES AND SIMILAR TRUST FUNDS COMBINED'STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS/FUND BALANCES Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 REVENUES Electric services Water and wastewater services User fees and rentals Billings to departments Employee contibutons Operating revenues from other governments Other operating revenues Operating revenues EXPENSES Electric operations Water and wastewater operations Other enterprise operations Internal service operations Depreciation and amortization Total operating expenses Operating income (loss) before nonoperating revenues (expenses) and operating transfers NONOPERATING REVENUES (EXPENSES)

Interest and other revenues Interest on revenue bonds and other debt Interest capitalized during construction Capital contributions Passenger facility charge Amortization of bond issue costs Other nonoperating expense Total nonoperýang revenues (expenses)

Costs (recovered) to be recovered in future years Income (loss) before operating transfers Operating transfers:

Operating transfers in Operating transfers out Net Income (loss)

Add depreciation transferred to contributions Net increase in retained earnings/fund balances Retained earnings/fund balances at beginning of year.

as previously reported Prior period adjustment Retained eamings/fund balances at beginning of year, as restated Retained earnings/fund balances at end of year The accompanying notes are an integral part of the financial statements.

Proprietary Fund Types Intemal Enterprise Service 806,310.682 219,914.504 178,112,881 169.413,223 20,350,742 3,266,054 4.341,498 1,207,604,121 194,105,463 458,685,525 102,411,722 141,784,303 186,345,906 160.840,169 3,591,343 863,721,719 189,937,249 343,882.402 4,168,214 81,598,970 1,510,452 (227,748,710)

(312,766) 5,234,561 46,843,438 9,999,244 (1.452.994)

(6.223)

(1.732.555)

(199,576)

(87,258,046) 991,887 (40,719,456) 215,904,900 5,160,101 36,576,026 1.000,000 (101.041,575) 151,439,351 6,160,101 2,537,185 153,976.536 6.160,101 1,699,241,712 5.147,626 (2,500,000) 1,696,741,712 5.147,626

$ 1,850,718,248 11,307.727 12

CITY OF, AUSTIN, TEXAS Exhibit A-4 Fiduciary Totals Fund Type (Memorandum Only)

Nonexpendable Trust 2001 2000 806,310,682 782,729,128 219,914.504 240,478,634 178.112,881 159.972,993 169,413,223 142,895,966 20,350,742 18,389,105 3,266,054 3,278,280 4,341,498 3,036,285 1.401,709.584 1,350,780.391 458,685,525 420,074,862 102,411,722 96,365,741 141,784,303 123,538,253 186,345,906 161,563,025 164,431,512 159,361,415 1,053,658,968 960,903,296 348,050,616 389,877,095 83,109,422 72,782,771 (228,061,476)

(225,453,642) 5,234,561 1,852,527 46,643,438 9.999,244 9,407.652 (1,459,217)

(1.430,722)

(1.932,131)

(4,339,779)

(86,266,159)

(147,181,193)

(40,719,456) 25,711,965 221,065,001 268,407,867 37,576,026 26,368,879 (101,041,575)

(86.315,239) 157,599,452 208,461,507 2,537,185 2,342,835 160.136,637 210,804.342 1,040,217

1,705,429.555 1,492,125.213 S....

(2,500,000) 1,040,217 1,702,929,555 -1.492,125,213 1.040,217 1.863.066,192 1,702,929,555 13

ALL PROPRIETARY FUND TYPES AND SIMILAR TRUST FUNDS COMBINED STATEMENT OF CASH FLOWS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CITY OF AUSTIN, TEXAS Exhibit A-5 Proprietary Fund Types Internal CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers Cash payments to suppliers for goods and services Cash payments to employees for services Cash payments to claimantsnbenefidaries Cash received from other governments Taxes collected and remitted to other governments Net cash provided by operating activities CASH FLOWS FROM NONCAPrrAL FINANCING ACTIVITIES:

Operating transfers in Operating transfers out Interest paid on revenue notes and other debt (Increase) decrease in deferred assets Contributions from municipality Loan repayments to other funds Loan repayments from other funds Net cash provided (used) by noncapital financing activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:

Proceeds from long-term debt issues Proceeds from long-term loans Principal paid on long-term debt Proceeds from the sale of fixed assets Purchased interest received Interest paid on revenue bonds and other debt Passenger facility charges Acquisition and construction of capital assets Contributions from municipality Contributions from State and Federal governments Acquisition of intangible assets Contributions in aid of construction Bond discounts and issuance costs Bond premiums Bonds issued for advanced refundings of debt Cash paid for bond refundings/defeasances Cash paid for nuclear fuel inventory Net cash used by capital and related financing activities CASH FLOWS FROM INVESTING ACTMITIES:

Purchase of investment securities Proceeds from sale and matunties of investment secunties Interest on investments Reverse repurchase agreement Income Reverse repurchase agreement expense Net cash provided by Investing activities The accompanying notes are an integral part of the financia Fiduciary Fund Type Nonexpendable Totals (Memorandum Only)

Enterprise Service Trust (1) 2001 2000

$ 1,268,237,045 194,706,933 1,462,943,978 1,256,518,708 (469.462.293)

(66,782,766)

(536,245,059)

(442.115,070)

(202,768,392)

(78,710,560)

(281,478,952)

(259,860,712)

(38,399,752)

(38,399,752)

(36,369,463) 3,266,054 3,266,054 2,785,271 (22.824,871)

(22,824,871)

(16.981,467) 576,447,543 10,813,855 587,261,398 503,977,267 36,576,026 1,000,000 37,576,026 26,368,879 (101.041,575)

(101,041.575)

(86,315,239)

(189,068)

(189,068)

(1,170,582)

(938,863)

(938,863) 135,567 904,368 3.253,421 4,157,789 139,155 (178,169)

(178,169) 21.222 (64,867,281) 4,253,421 (60,613,860)

(60,820,998) 172,830,000 172,830,000 217,844,960 1,405,340 1,405,340 (119,832,943)

(1,218,746)

(121,051,689)

(135,584,651) 20,000 17,000 37,000 930,246 2,715,091 2,715,091 815,775 (198,907,791)

(332,315)

(199,240,106)

(201,681,835) 9,999.244 9,999.244 9,407,652 (449,640.566)

(11,238.356)

(460,878,922)

(368,546,747) 1.366 3,731.702 3,733,068 6,776,620 8,943,294 8,943,294 10,931,313 (101.582)

(101,582)

(100,000.000) 4,254,591 4,254,591 16,594,929 (3,809,169)

(4,111)

(3,813,280)

(2,245.888) 3,060,414 28,186 3,088,600 240,583 367,738,710 590,656 368,329,366 100.000.000 (376,494.068)

(603,492)

(377,097,560)

(99,205,027)

(10,571,733)

(10,571,733)

(6,681,685)

(588,389,802)

(9,029,476)

(597,419,278)

(550.403.755)

(707,851,885)

(707,851,885)

(652,344.315) 731,249,880 731,249,880 668.174.899 62,394,228 1,510,452 63,904,680 63,408,464 4,608,990 (4.357,463) 85,792,223 1.510,452 87,302,675 79,490,575 (continued)

Ia statements.

14

ALL PROPRIETARY FUND TYPES AND SIMILAR TRUST FUNDS COMBINED STATEMENT OF CASH FLOWS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000.

CITY OF AUSTIN, TEXAS Exhibit A-5 (Continued)

Proprietary Fund Types Internal Net increase (decrease) in cash and cash equivalents Cash and cash equivalents, October 1, 2000 (2)

Cash and cash equivalents, September 30, 2001 (2)

RECONCIUATION OF OPERATING INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES:

Operating income Adjustments to reconcile operating income to net cash provided by operating acivities Depreciation Amortization Change In assets and liabilities:

(increase) decrease In working capital advances (Increase) decrease in accounts receivable (Increase) decrease In allowance for uncollectible accounts Decrease In due from other funds (Increase) decrease in inventory (Increase) decrease in prepaid expenses and deferred costs (Increase) decrease In other regulatory assets (Increase) decrease in other long-term assets Increase (decrease) in accounts payable Increase (decrease) in accrued payroll and compensated absences Increase (decrease) in deferred revenue Decrease in decommissioning assessment payable (Increase) decrease in unrecovered fuel revenue Increase In accrued landfill closure costs Increase In claims payable Decrease in due to other governments Decrease in due to other funds Decrease in advance from other funds Increase In other liabilities Increase in customer deposits Total adjustments Net cash provided by operating activities (1)

(2)

Fiduciary Fund Type Nonexpendable Totals (Memorandum Only)

Enterprise Service Trust (1) 2001 2000 8.982,683 7.548,252

- 16,530.935 (27,756,911) 556,854,286 47,960,302 1,040,217 605,854.805 633.611,716

'565,836,969 55,508,554 1,040,217 622.385.740 605.854,805 343,882,402 4,168,214 348,050,616 389,877,095 158,340,169 3,591,343 161,931,512 156,861.415 12.846,051 12,846,051 11,549,749 (466,433)

(466,433) 578,050 24,254.033 "14,708 24,268,741 (38,529,923) 131,372 131.372 (364,004) 24,766 (2.589.703) 411,012 (2.178.691) 3,291,819 567,710 (96,545) 471.165 (1,084.338)

(100,068)

(100.068) 356,339 (2,843,038)

(2.643.038) 123,674 (3,474,944) 321,243 (3.153,701) 32.446,830 2,204,700 648,343 2,853,043 (8,174,383)

(985,824) 586,762 (399.062)

(892,652)

(262,048)

(262.048)

(271,131) 35,803,879 35,803,879 (51.725,251) 203,138 203,138 233,505 1.391,578 1,391.578 2,453,761 (493.009)

(301,397)

(301.397)

(45.988)

(26,872)

(26,872)

(328,269) 7,819,618 105,466 7,925,084 7,146.769 916,529 916,529 942,443 232,565,141 6,645,641 239,210,782 114,100.172 576,447,543 10,813,855 587,261,398 503,977.267 (continued)

Nonexpendable trust fund cash and cash equivalents of $1,040,217 are reported on the balance sheet with all trust and agency funds' pooled investments and cash of $9,421,637 at October 1, 2000 and $8,112,717 at September 30, 2001.

Cash and cash equivalents Includes $476,493,720 and $2,375,955 in enterprise and Internal service funds' restricted accounts, respectively at October 1, 2000 and $431,935,471 and $1,885,414 in enterpnse and internal service funds' restricted accounts.

respectively at September 30, 2001.

The accompanying notes are an Integral part of the financial statements.

15

ALL PROPRIETARY FUND TYPES AND SIMILAR TRUST FUNDS COMBINED STATEMENT OF CASH FLOWS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CITY OF AUSTIN, TEXAS Exhibit A-5 (Continued)

Proprietary Fund Enterprise Fiduciary 1Types Fund Type Internal Nonexpendable Service Trust (1)

Totals (Memorandum Only) 2001 2000 NONCASH INVESTING, CAPITAL AND FINANCING ACTIVITIES:

Increase in advances to other funds Increase (decrease) in deferred assets/expenses Unamortized bond discounts, premiums, and issue costs on refunded bonds Increase in capital appreciation bond interest payable Increase in deferred revenue Increase In contributed facilibes Net increase in fair value of investment Amortization of bond discounts, premiums, and issue costs Amortization of deferred loss on refundings Loss on disposal of assets Costs (recovered) to be recovered in future years Loss on extinguishment of debt Due to other funds for fixed assets Contnbutions from other funds Deferred revenue and other liabilities (22,261,454)

(1,100)

(790,465)

(16.512,872) 18,229,303 17,604,840 (4,912,708)

(539,387)

(947,635)

(40.719,456)

(116,807) 34,362,666 (2,455)

(3,768)

(199,576) 4,318,000 (22,262,554) 9,720,585 (790,465)

(16,512,872)

(18,674,086)

(4,318,000) 18,229,303 14,918,520 17.604,840 990,517 (4,915,163)

(543,155)

(1,147,211)

(40,719,456)

(116,807) 34,362,666 (5,333,141)

(514,217)

(1,872.106) 25,711,965 (556,529)

(2,656) 63,750 The accompanying notes are an integral part of the financial statements 16

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 Note Page' 1

Reporting Entity 18 2

Significant Accounting Policies 18 3

Budget Basis Reporting 28 4

Deficits in Fund Balance and Retained Earnings 31 5

Pooled Investments and Cash 32 6

Investments and Deposits 32 7

Property Taxes 34 8

Fixed Assets 35 9

Retirement Plans 36 10 Selected Revenues 39 11 General Long-Term Debt 39 12 Enterprise Funds - Revenue Bonds and Other Long-Term Debt 43 13 Conduit Debt 49 14 Debt Service Reqtiirements 50 15 Interfund Receivables and Payables 56 16 Interfund transfers 58 17 Segment Information 60 18

'-Joint Operations 61 19 Litigation 64 20 Commitments and Contingencies 64 21 rOther Post-Employment Benefits 69 22 Subsequent Events 70 17

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 1 -- REPORTING ENTITY The City of Austin, Texas (the City) is a municipal corporation incorporated under Article Xl, Section 5 of the Constitution of the State of Texas (Home Rule Amendment). The City operates under a Council-Manager form of government The City Council is composed of a Mayor and six Councilmembers, all of whom are elected at large for three-year staggered terms, and who may serve for a maximum of two consecutive terms.

As required by generally accepted accounting principles, these financial statements present the City and its component units, entities for which the City is considered to be financially accountable. Blended component units, although legally separate entities, are, in substance, part of the City's operations and so data from these units are combined with data of the City.

The City's major activities or functions include police and fire protection, emergency medical services, parks and libraries, public health and social services, urban growth management, and general administrative services. In addition, the City owns and operates certain major enterprise activities, including an electric utility system, water and wastewater system, airport, convention center, and other enterprise activities. These activities are included in the accompanying financial statements.

Blended Component Units The Austin Housing Finance Corporation (AHFC) and Austin Industrial Development Corporation (AIDC) are legally separate entities from the City. AHFC and AIDC serve all the citizens of Austin and are governed by a board composed of the City Councilmembers. The activities are reported in the Housing Assistance Fund and Austin Industrial Development Corporation Fund, special revenue funds.

Related Organizations The following entities are related organizations to which the City Council appoints board members, but for which the City has no significant financial accountability. The City appoints certain members of the board of the Capital Metropolitan Transit Authonty (Capital Metro), but the City's accountability for this organization does not extend beyond making the appointments.

City Councilmembers appoint themselves as members of the board of the Austin-Bergstrom International Airport (ABIA)

Development Corporation; their function on this board is ministerial rather than substantive. The City Council appoints the members of the board of Austin-Bergstrom Landhost Enterpnses, Inc., and Austin Convention Enterprises, Inc.; the function of these boards is ministerial rather than substantive.

The City retirement plans (descnbed in Note 9) and the City of Austin Deferred Compensation Plan for City employees are not included in the City's reporting entity because the City does not exercise substantial control over the entities.

2 - SIGNIFICANT ACCOUNTING POLICIES The accounting and reporting policies of the City relating to the funds and account groups included in the accompanying financial statements conform to generally accepted accounting principles applicable to state and local governments.

Generally accepted accounting principles for local governments include those principles prescribed by the Governmental Accounting Standards Board (GASB) in its publication GASB Statement 1 entitled Authoritative Status of NCGA Pronouncements and AICPA Industry Auditing Guide, and all subsequent GASB statements, interpretations, concept statements, and technical bulletins; the National Council on Governmental Accounting (NCGA) in the publication entitled Governmental Accounting, Auditing, and Financial Reporting, including NCGA Statements 1 through 7 and interpretations thereof; and by the American Institute of Certified Public Accountants in the publication entitled Audits of State and Local Governmental Units. The following represent the more significant accounting and reporting policies and practices used by the City.

GASB Statement 34 GASB Statement 34, Basic Financial Statements-and Management's Discussion and Analysis-for State and Local Governments represents a significant change in financial reporting for governments.

The City will implement GASB Statement No. 34 in the financial statements for fiscal year 2002.

Audit The Charter of the City of Austin requires an annual audit by an independent certified public accountant.

18

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS S(Continued) 2 - SIGNIFICANT ACCOUNTING POLICIES, continued Basis of Presentation The accounts of the City are organized and operated on the basis of funds or account groups, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a self-balancing set of accounts that comprise its assets, liabilities, fund balances or retained earnings, revenues, and expenditures or expenses. The various funds are grouped by category and type in the financial statements. The City maintains the following fund types within three broad fund categories and the account groups:

Governmental Funds Governmental funds are'those through which most governmental functions of the City are financed. The acquisition, use and balances of the City's expendable financial resources and the related current liabilities (except those, if any, which should be accounted for in proprietary funds) are accounted for through governmental funds.

The measurement focus is on determination of financial position and changes in financial position rather than on determination of net income. The following governmental fund types are maintained by the City:

General Fund - The General Fund is the general operating fund bfthe City.- It is used to account for all financial resou'rces except those required to be accounted for in another fund. All general tax revenues and other receipts that are not allobated by law, ordinance, or contractual agreement to other funds are accounted for in this fund.

Special Revenue Funds -, Special revenue funds are 'used to account for the proceeds of specific revenue sources (other than expendable trusts or major capital projects) that are legally restricted to expenditures for specified purposes. There are four major groups of funds within the special revenue..funds, in addition to the Housing Assistance Fund. Of these groups, three account for the activities related to grant programs and one accounts for activities for which expenditures are legally restricted. The groups are: Federal grant funds (both direct iand indirect funds), State grant funds, other special revenue grant funds, and other special revenue funds.

Debt Service Funds - The debt service funds are used to account for the accumulation of resources for, and the payment of,

,general long-term debt principal, interest, related costs and certain loans. -The two debt service funds are General Obligation Debt Service and HUD Section 108 Loans.

Capital Project Funds - Capital project funds are used to account for financial resources for the acquisition or construction of major.capital facilities (other than those reported within proprietary funds and trust funds). Capital projects are funded primanly by general obligation debt, other tax supported debt, interest income, and other intergovemmental revenues.

In 1981, the City Council passed an ordinance that requires the establishment of a separate fund for each bond proposition approved in each bond election. These separate funds are grouped by year and by bond election date. There are eight major groups of funds within the capital projects funds that account for the activities related to various capital improvement projects as follows:

Prior to 1984: funds adthorized prior to 1981; funds authorized August 29, 1981, for street and drainage, fire stations, and emergencj medical service projects; funds authorized September 11, 1982, for various purposes; funds authorized October 22, 1983, for Jollyville Road Improvements and City facility Improvements;

,1984:

funds authorized September 8, 1984, for yarious purposes; 1985:

fuhds authorized January 19, 1985, for-cultural projects; "funds authorized July 26, 1985, for parks and recreation; funds authorized September 26, 1985, for art in public places; funds authorized December 14, 1985, for various purposes;..

1987:

funds authorized September 3, 1987, for street improvements; 1992:

funds'authoriied August 10, 1992, for various purposes; 1997:

funds authorized May 3, 1997, for radio trunking; 1998:

'funds authorized November 3, 1998, for various purposes; and Other other funds established for various purposes.

19

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continued) 2 - SIGNIFICANT ACCOUNTING POLICIES, continued Proprietary Funds Proprietary funds are used to account for the City's ongoing organizations and activities that are similar to those found in the private sector. The measurement focus is on capital maintenance and on determination of net income, financial position, and changes in financial position.

Enterprise Funds - Enterprise funds are used to account for operations: (1) that are financed and operated in a manner similar to private business enterprises, where the intent of the governing body is that the costs (expenses including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges, or (2) where the governing body has decided that periodic determination of revenues earned, expenses incurred, or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes.

The City's enterprise funds include the following:

Fund Electric System Water and Wastewater System Hospital Solid Waste Services Airport Convention Center Drainage Transportation Golf Parks and Recreation Accounts For Activities of the City-owned electric utility, doing business as Austin Energy Activities of the City-owned water and wastewater utility Activities related to the lease of City-owned Brackenridge Hospital Solid waste collection and disposal activities; recycling activities Operations of the Austin-Bergstrom International Airport Operations of the Convention Center, Palmer Auditorium, and the City Coliseum; construction of the Convention Center expansion and Town Lake Venue Project Drainage management activities Street maintenance activities Public golf courses City-sponsored softball and recreation programs Internal Service Funds - Internal service funds are used to account for the financing of goods or services provided by one department or agency to other City departments or agencies or to other governmental units on a cost-reimbursement basis.

The City maintains nine internal service funds as follows:

Fund Fleet Maintenance Support Services Information Systems Employee Benefits Liability Reserve Workers' Compensation Radio Communication Infrastructure Support Services Capital Projects Management Accounts For Maintenance costs of City-owned vehicles Activities of the City's support service departments Activities of the Information Systems Department Activities related to the health, dental, and life insurance costs of City employees Coverage of the City's major claims liabilities Workers' compensation costs Radio communication services for City departments and area agencies Activities for support services for five City departments Activities for management of the City's capital improvement projects Fiduciary Funds Fiduciary funds are used to account for assets held by the City in a trustee capacity or as an agent for individuals, private organizations, other governmental units, or other funds. Fiduciary funds include expendable and nonexpendable trust funds and agency funds.

Expendable Trust Funds - Expendable trust funds are accounted for in essentially the same manner as governmental funds. The measurement focus is on determination'of changes in financial position rather than on net income.

Nonexpendable Trust Funds -

These funds are accounted for in the same manner as proprietary funds, with the measurement focus on determination of net income and capital maintenance.

20

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 2-- SIGNIFICANT ACCOUNTING POLICIES, continued Agency Funds - Agency funds are purely custodial (assets equal liabilities) and thus do not involvemeasurement of results of operations.

Account Groups Account groups are used to establish accounting control and accountability for the City's general fixed assets and general long-term liabilities. The following are the account groups maintained by the City.

General Fixed Assets Account Group - This account group accounts for all fixed assets of the City other than those accounted for in the proprietary funds.

General Long-Term Debt Account Group - This account group accounts for and provides control over all long-term liabilities other than those accounted for In the proprietary funds, including unmatured general obligation bonds.

Basis of Accounting Basis of accounting refers to the time at which revenues and expenditures (governmental funds) or expenses (proprietary funds) are recognized in the accounts and reported in the financial statements.

Governmental funds, expendable trust funds, and agency funds are accounted for on the modified accrual basis of accounting. Under the modified accrual basis of accounting, certain revenues are recorded when susceptible to accrual (i e.,

both measurable and available). Available means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Expenditures, if measurable, are generally recognized on the accrual basis of accounting when the related liability is incurred. Exceptions to this general rule include the unmatured principal and interest on general obligation long-term debt, which is recognized when due.

This exception is in conformity with generally accepted governmental accounting principles Agency funds use the modified accrual basis of accounting to recognize assets and liabilities.

Property tax revenues are recognized when they become available in accordance with GASB Interpretation No. 5, Property Tax Revenue Recognition in Governmental Funds. Available means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period (within 60 days) Tax collections expected to be received after the 60-day availability period are reported as deferred revenue. Sales taxes are also recognized when they become available In accordance with GASB Statement No. 22, Accounting for Taxpayer-Assessed Tax Revenues in Governmental Funds.

In fiscal year 2001, the City implemented GASB Statement No. 33, Accounting and Financial Reporting for Nonexchange Transactions, and Statement No. 36, Recipient Reporting for Certain Shared Nonexchange Revenues - an amendment of GASB Statement No. 33.

The Statements establish financial reporting standards for nonexchange transactions. The Statements require that certain revenues be recognized when the underlying transaction occurs, even if collected in a future financial reporting period. As a result, the City has recognized certain Imposed nonexchange transactions collected within 60 days subsequent to September 30. The cumulative effect to fund balance as of September 30, 2001 was an increase of

$5,831,220 in the Hotel-Motel Occupancy Tax Fund and an increase of $2,408,514 in the Vehicle Rental Tax Fund. See page 27 for further information on prior period restatements. In addition, the City recognized certain capital contributions as non-operating revenues.

In applying the susceptible-to-accrual concept to Intergovernmental revenues, the legal and contractual requirements of the individual grant programs are used for guidance. For most of the Citys grants, money must be expended for the specific purpose or project before any amounts will be paid to the City. 'For all grants, revenues are recognized based upon the expenditures recorded.

Proprietary funds and nonexpendable trust funds use the accrual basis of accounting under which revenues are recognized in the accounting period in which they are earned and become measurable. Expenses are recorded in the accounting period incurred, if measurable.

In accordance with GASB Statement 20, the City is required to follow all Financial Accounting Standards Board (FASB) pronouncements issued prior to November 30, 1989, including FASB Statement 71, unless those pronouncements conflict 21

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 2 - SIGNIFICANT ACCOUNTING POLICIES, continued with or contradict GASB pronouncements. The City has elected not to follow FASB pronouncements issued subsequent to that date.

Investment earnings are recorded on the accrual basis in all funds, and unrealized gains or losses on investments are recognized in accordance with GASB Statement No. 31.

Revenues in the Electric Fund, Water and Wastewater Fund, Solid Waste Services Fund, Drainage Fund, and Transportation Fund are recognized as they are billed to customers on a cyclical basis. Electric rates include a fixed rate and a fuel recovery cost-adjustment factor that allows recovery of coal, gas, purchased power, and other fuel costs. Electric deferred or unbilled revenues are recorded if actual fuel costs differ from amounts billed to customers, and any over-collections or under collections are applied to the cost-adjustment factor. The fuel factor is revised annually on a calendar year basis or when over or under fuel recovery is more than 10% of expected fuel costs.

Revenues for the airport fund are recognized as they are billed to customers. Effective November 1, 1993, the Airport Fund began to charge each enplaned passenger a $3 passenger facility charge, as allowed by the Federal Aviation Administration.

Airport Fund 2001 non-operating revenues included passenger facility charges of $9,999,244. These funds were approved by the FAA for debt service payments for the Austin-Bergstrom International Airport.

Revenues for the Convention Center are recognized as they are billed to customers upon completion of events held at the Convention Center facilities.

In accordance with current accounting principles, provisions of the various statements need not be applied to immaterial items.

Rates The Texas Public Utility Commission has jurisdiction over electric utility wholesale transmission rates. The City Council has jurisdiction over all other electric utility rates and over all water and wastewater utility rates and other services. The Council's determination of water and wastewater utility rates and electric utility rates is based on the cost of operations and a debt service coverage approach.

Under a bill passed by the Texas Legislature in 1999, municipally owned electric utilities such as the City's utility system have the option of offering retail competition after January 1, 2002. At September 30, City management had not decided to enter into retail competition, as allowed by State law, thus the effects of entering retail competition are uncertain and do not warrant a change in accounting policy.

Budget In accordance with the City Charter, the City adheres to the following procedures in establishing its operating budgets:

(1) At least thirty days prior to the beginning of the new fiscal year, the City Manager submits a proposed budget to the City Council. The budget represents the financial plan for the new fiscal year and includes proposed expenditures and the means of financing them.

(2) Public hearings are conducted on the budget to obtain taxpayer comments.

(3) The budget is legally enacted by the City Council no later than the twenty-seventh day of the last month of the old fiscal year, through passage of an appropriation ordinance and tax levying ordinance.

(4) The City Manager has the authonty to transfer appropriation balances from one expenditure account to another within a fund and department of the City., The City Council must approve amendments to the budget and transfers of appropriations from one fund and department to another.

Any budget amendments for the General Fund are summarized in Note 3.

(5) Formal budgetary control is employed as a management control device during the year for the General Fund, certain non-grant special revenue funds, debt service funds and proprietary funds. Management control for the operating budget 22

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 2-SIGNIFICANT ACCOUNTING POLICIES, continued is maintained at the fund and department level. Formal budgetary control is employed as a management control device in the special revenue grant funds and capital projects funds for the life of the related grants or projects.

(6) Annual budgets are legally adopted for the General Fund, certain special revenue funds, debt service funds, certain trust funds, and proprietary funds.

A comparison of budget to actual is presented In the financial statements for all governmental funds that adopt annual budgets.- Budgets for the grant-related special -revenue funds-are established pursuant to the terms of the related grant awards.

Capital project fund appropriations are increased on an 'annual basis through the budgetary'process. However, the budgets are not binding on an annual basis. Rather, budgets are long-range and are used for planning purposes.

Accordingly, no comparison of budget to actual is presented in the financial statements for such funds.

(7)The City Charter does not permit a deficiency of anticipated revenues over appropriations. If at any time during the fiscal year the'City Manager determines that available reventjes plus' beginning fund 'balance'wil be less than-total appropriations for the year, he or she shall reconsider the work programs of the departments and agencies and revise them to prevent deficit spending. Expenditures may not legally exceed budgeted activities at the departmental level.

(8) At the close of each fiscal year, any unencumbered appropriation balances in the General Fund and certain special revenue'fun-ds lapse or revert to the undesighated fund balance. In the proprietary funds, utnencumbered appropriations also' lapse but do 'not revert to fLnid balance for accounting purposes because' of the differences in methods of accounting' Unencumbered appropriation balances in the grant-related special re~erue funds and "capital proje-cts funds do not lapse at year-end.

Encumbrances outstanding at year end and the related appropriation are available for expenditure in subsequent years.

For governmental funds, encumbrances constitute the equivalent of _expenditures *for budgetary purposes and accordingly, the accompanying financial statements' present comparisons of actual results "to the budgets for governmental funds on a budget-basis (see Note 3), which may differ from that used for reporting In accordance with generally accepted accounting principles (GAAP basis).

Encumbrances Encumbrances represent commitments for unperformed (executory) contracts for goods or services.

Encumbrance accounting, under which purchase orders, contracts, and other-commitments are recorded to'reserve appropriations, is used in the governmental funds. Encumbrances outstanding at year-end are reported as reservatiorns of fund balance and do not constitute GAAP-basis expenditures or liabilities, since the commitments will be horio-ed during the subsequent year.

Pooled Investments and Cash Cash ba ances of all City funds (except for certain funds shown in Note 6 as having non-pooled Investments) are pooled and invested. Investments purchased with pooled cash, consisting primarily of U.S. government obligations and U.S. agency obligations, are stated at fair value. Interest earned 'on investments pur6hased with p6oled cash is allocated monthly to each participating fund based upon the fund's average daily balance."-Funds'that In-cur a negative balance in pooled cash and investments are not allocated Interest earnings nor charged Interest expense.

Investments The City complies with Gove'rmnental Accounting Standardsý Board (GASB) Statement 31,

'Accouting "and Financial Reporting for Certain Investments and for External Investment Po6ls (see Note 6),1 which requires certain investments to be reported at fair value. The fair value Is based on quoted market prices.- Reaized gainrs'o&r losses resulting fromthe sale of investments are' determined by the specific cost of the'secudtii' sold. The City cares all of its investments at fair valiue as of September 30, 2001.

23

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 2 - SIGNIFICANT ACCOUNTING POLICIES, continued Inventories Inventories are valued at cost, which is determined as follows:

Fund Inventory Valuation Method General Fund Average cost (predominantly); some first-in, first-out Electric Fuel oil and coal Last-in, first out Other inventories Average cost All other Average cost Inventories for all funds use the consumption method and record expenditures when issued. Inventories reported in the General Fund and certain special revenue funds are offset by a fund balance reserve, which indicates they do not represent "available spendable resources."

Property, Plant and Equipment - Proprietary Funds Prop6rty, plant and equipment owned by the proprietary funds are stated at historical cost. Maintenance and repairs are charged to operations as incurred, and improvements and betterments that extend the useful lives of fixed assets are capitalized. Interest paid on long-term debt in the enterprise funds is capitalized when it can be attributed to a specific project and when it materially exceeds the interest revenue generated by the bond proceeds issued to fund the project. Depreciation of plant and equipment classified by functional components is provided by the straight-line method over their estimated *useful lives. Estimated useful lives are as follows:

Electric Fund and Water and Wastewater Fund:

Plant 30-50 years Improvements to grounds 30-50 years Transmission and distnbution system 12-50 years Other machinery and equipment 7-30 years Vehicles 7 years Other Enterprise Funds and Internal Service Funds:

Buildings and improvements 40 years Improvements to grounds 15 years Machinery and equipment 7-12 years Vehicles 7 years Depreciation of completed but unclassified fixed assets is provided by the straight-line method, using a composite rate.

The City is accelerating the depreciation of two generating stations that will be retired before the end of their estimated useful life. The increase to Electric Fund 2001 depreciation expense for this accelerated depreciation is $209,974.

When the City retires or otherwise disposes of proprietary fund fixed assets (other than debt-financed assets of the utility funds), it recognizes a gain or loss on the disposal of the assets.

Federal, State or local grant funds that are restricted to purchasing property, plant, and equipment and contributions in aid of construction are recorded as capital contnbutions when received.

Depreciation on contributed assets is recorded as an expense in the statement of operations; for contributions prior to fiscal year 2001, the depreciation is then transferred to the related contribution accounts.

Cointnbutions of funds from the municipality are recorded as equity contributions when received.

24

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 2 - SIGNIFICANT ACCOUNTING POLICIES, continued Intangible Assets - Proprietary Funds On October 7, 1999, the City and the Lower Colorado River Authority (LCRA) signed a historic fifty-year assured water supply agreement, with an option to extend another fifty years. The $100 million contract reserves an additional 75,000 acre-feet of water for Austin and allows the City to take water from the Highland Lakes, rather than relying exclusively on available river water. The Water and Wastewater Fund has recorded the water rights as an intangible asset, which is being amortized over 40 years and is reported net of accumulated amortization of $5 million.

General Fixed Assets General fixed assets have been acquired for general governmental purposes. Assets purchased or constructed are recorded as expenditures in the governmental funds and capitalized at historical cost in the General Fixed Assets Account'Group.

Contributed fixed assets are recorded in the General Fixed Assets Account Group at estimated fair market value at the time received.

The City does not capitalize public domain general fixed assets (infrastructure) and, accordingly, no such assets are recorded in the General Fixed Assets Account Group. Infrastructure consists of certain improvements other than buildings, including roads, bridges, curbs and gutters, streets and sidewalks, drainage systems and traffic signal systems. Such assets normally are immovable and are of value only to the City. Therefore, the responsibility for stewardship for capital expenditures is satisfied without recording these assets. This accounting treatment will change with the implementation of GASB Statement No. 34 in fiscal year 2002.

No depreciation has been provided on general fixed assets. No interest has been capitalized on general fixed assets.

Long-Term Debt The debt service for general obligation bonds and other general obligation debt, including loans, issued to fundgeneral government capital projects is paid from tax revenues, interfund transfers, and intergovernmental revenues. Such general obligation debt is recorded in the General Long-Term Debt Account Group The debt service for general obligation bonds and other general obligation debt issued to fund proprietary fund capital projects is normally paid from net revenues of the applicable proprietary fund, although such debt will be repaid from tax revenues if necessary. Such general obligation debt is shown as a specific liability of the applicable proprietary fund, which is appropriate under generally accepted accounting principles and in view of the expectation that the proprietary fund will provide resources to service the debt.

Revenue bonds that have been issued to fund capital projects of certain enterprise funds are to be repaid from net revenues of these funds. Such debt is recorded in the funds.

The City defers and amortizes gains or losses that its proprietary funds realize on refundings of debt and reports both the new debt liability and the related deferred amount on the funds' balance sheets. The City recognizes gains or losses on debt defeasance when funds from current operations are used.

Compensated Absences All full-time employees accumulate vacation benefits in varying annual amounts up to a maximum'allowable accumulation of six weeks. All full-time employees earn sick leave benefits at a rate of twelve days per year, these benefits may be accumulated without limit. Upon termination, an employee Is reimbursed for all accumulated vacation days. If the terminating employee was employed prior to October 1, 1986 and leaves in good standing, reimbursement is also made for all accrued sick leave up to ninety days. Certain employees:are also allowed to accumulate credit for compensatorytime In lieu of overtime pay up to 120 hours0.00139 days <br />0.0333 hours <br />1.984127e-4 weeks <br />4.566e-5 months <br />. Compensated absence liabilities include the components above, as well as employment related taxes.

I 25

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 2 -- SIGNIFICANT ACCOUNTING POLICIES, continued For governmental funds, the estimated current portion of the compensated absence liability is recorded as an expenditure and liability in the General Fund or special revenue fund, with the non-current portion of the liability recorded in the General Long-Term Debt Account Group. The current portion is estimated based on amounts paid to terminating employees during the most recent fiscal year. Actual vacation, sick and compensatory time benefits paid during the year are recorded as expenditures in the governmental funds.

For proprietary funds, the compensated absences liability is recorded as an expense and related liability in the year earned.

The current portion is estimated based on an analysis of the historical use of benefits by the employees.

Risk Management The City is exposed to employee-related risks for health benefits and workers' compensation, as well as to various risks of loss related to torts, including medical malpractice; theft of, damage to, or destruction of assets; errors and omissions; and natural disasters. The City continues to be self-insured for liabilities for most health benefits, third-party and workers' compensation claims.

The City purchases commercial insurance for coverage for property loss or damage, commercial crime, fidelity bond, and airport operations. In addition; the City purchases a broad range of insurance coverage for contractors working at selected capital improvement project sites. The City does not participate in a risk pool. The City complies with GASB Statement 10, Accounting and Reporting for Risk Financing and Related Insurance Issues (see Note 20).

Pension Plans It is the policy of the City to fund pension costs annually. Pension costs are composed of normal cost and, where applicable, amortization of unfunded actuarial accrued liability and of unfunded prior service cost (see Note 9).

Federal and State Grants, Entitlements and Shared Revenues Grants, entitlements and shared revenues may be accounted for within any of the seven fund types. The purpose and requirements of each grant, entitlement, or shared revenue are analyzed to determine the proper fund type in which to record the related transactions. Grants, entitlements and shared revenues received for activities normally recorded in a particular fund type may be accounted for in that fund type, provided that applicable legal restrictions can be satisfied.

Revenues received for activities normally recorded in other governmental funds are accounted for within these special revenue fund groups: Federal grant funds, State grant funds, and other special revenue grant funds. Capital grants restricted for capital acquisitions or construction, other than those associated with proprietary type funds, are accounted for in the applicable capital projects funds. Revenues received for operating activities of proprietary funds or revenues that may be used for either operations or capital expenditures at the discretion of the City are recognized in the applicable proprietary fund. Grant money restricted for acquisition or construction of capital assets is recorded as capital contributions in the applicable proprietary fund in fiscal year 2001.

Intergovernmental Revenues, Receivables and Liabilities Intergovernmental revenues and related receivables arise primarily through funding received from Federal and State grants.

These revenues and receivables are earned through expenditure of money for grant purposes. Intergovernmental liabilities arise primarily from funds held in an agency capacity for other local govemmentat units.

Transactions Between Funds During the course of normal operations, the City has numerous transactions between funds. Short-term advances between funds are accounted for in the pooled investments and cash accounts. Transactions between funds that would be treated as revenues, expenditures, or expenses if they involved organizations external to the governmental unit are accounted for as revenues, expenditures, or expenses in the funds involved. Transactions between funds that constitute reimbursements for expenditures or expenses are recorded as expenditures or expenses in the reimbursing fund and as reductions of the expenditure or expense in the fund that is reimbursed.

26

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 2-- SIGNIFICANT ACCOUNTING POLICIES, continued Nonrecurring or nonroutine transfers of equity between funds are treated as residual equity transfers'and are reported as additions to or deductions from the fund balance of governmental funds. Residual equity transfers to proprietary funds are treated as 'contributed capital, and such transfers from proprietary funds are reported as reductions of retained earnings or contributed capital as appropriate: All other legally authorized transfers are treated as operating transfers and are included in the results of operations of both governmental and proprietary funds.

Comparative Data Comparative data for the prior year have been presented in the accompanying financial statements in order to provide an understanding of changes in the City's financial position and operations.

However, complete comparative data, (i.e.,

presentation of prior year totals by fund type) have not been presented in each of the statements since their inclusion would make the statements unduly complex and difficult to read.

Reclassifications and Restatements Certain comparative data for the prior year have been reclassified or restated to present them in a manner consistent with the current year's financial statements. In 2001, the City implemented GASB Statements No. 33, Accounting and Financial Reporting for Nonexchange Transactions, and No. 36, Recipient Reporting for Certain Shared Nonexchange Revenues - an amendment of GASB Statement No. 33, resulting in the following restatement of fund balance for the following special revenue funds for fiscal year 2000 (in thousands):

I.

Hotel-Motel Vehicle Occupancy Rental Description Tax Fund Tax Fund Fund balance, September 30, 2000, as previously reported 5,954 Prior period adjustment 7,604 1,467 Fund balance, September 30, 2000, restated

$ 7,604 7,421 In fiscal year 2001, the City identified a liability that should have been recorded in the Airport Fund at September 30, 2000.

This liability has been recorded, and the Airport Fund September 30, 2000 retained earnings has been restated, decreasing retained earnings by $2.5 million, from $146.4 million to $143.9 million.

Total Columns on Combined Financial Statements Total columns on the combined financial statements are captioned "Memorandum Only" to indicate they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or cash flows in conformity with generally accepted accounting principles. No consolidating or other eliminations of interfund balances or transactions were made in arriving at the totals. Such data are not comparable to a consolidation.

Deferred Items The City's ublity systems are reported in accordance with Statement of Financial Accounting Standards No. 71, Accounting for the Effects of Certain Types of Regulation. Certain utility expenses that do not currently require funds are deferred to future periods in which they are intended to be recovered by rates. Likewise, certain credits to income are deferred to periods in which they are matched with related costs. These expenses or credits include changes in fair value of Investments in accordance with GASB Statement 31. Deferred expenses will be recovered in these future periods by setting rates sufficient to provide funds for the related debt service requirements. If rates being charged will not recover deferred expenses, the deferred expenses will be subject to write off. Retail deregulation of electric rates in the future may affect the City's current accounting treatment of its electric utility revenues, expenses and deferred amounts.

27

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 2 - SIGNIFICANT ACCOUNTING POLICIES, continued Statement of Cash Flows For purposes of the statement of cash flows, the City considers cash and cash equivalents to be currency on hand, cash held by trustee, demand deposits with banks, and all amounts included in pooled investment and cash accounts.

Landfill Closure and Postclosure Care Costs The City reports municipal solid waste landfill costs in accordance with GASB Statement 18, Accounting for Municipal Solid Waste Landfill Closure and Postclosure Care Costs. The liability for landfill closure and postclosure costs is reported in the Solid Waste Services Fund, an enterprise fund.

3 - BUDGET BASIS REPORTING a - General The City of Austin prepares its annual operating budget based on cash and available resources (budget basis) that differs from generally accepted accounting principles (GAAP basis). In order to provide a meaningful comparison of actual results with the budget, the Combined Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Budget Basis for the General Fund, certain special revenue funds, and debt service funds present the actual and budget amounts in accordance with the City's budget basis.

28 I

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN,.TEXAS (Continued) 3 - BUDGET BASIS REPORTING, continued b - Reconciliation of GAAP Basis and Budget Basis Amounts The primary differences between GAAP and budget reporting for the General Fund are the reporting of encumbrances and the reporting of certain operating transfers. General Fund accrued payroll is recorded at the department level on a GAAP basis and in nondepartmental expenditures on the budget basis. The differences for those special revenue funds that have a legally adopted annual budget are the reporting of unbudgeted revenues, encumbrances and the recording of payroll and compensated absences on a GAAP basis, as opposed to the budget basis. Adjustments necessary to convert the excess of revenues and other sources over expenditures and other uses on a GAAP basis to a budget basis for the General Fund and these special revenue funds are provided, as follows:

Excess (deficiency) of revenues and other sources over expenditures and other uses - GAAP basis Adjustment:

Less: Excess revenues and other sources over expenditures and other uses for nonbudgeted funds - GAAP basis Adjusted excess (deficiency) of revenues and other sources over expenditures and other~uses - GAAP basis Other adjustments:

Increase due to unbudgeted revenues Decrease due to unbudgeted payroll accrual Decrease due to net compensated absences'accrual Decrease due to outstanding encumbrances established in 2001 Increase due to payments against prior year encumbrances Decrease due to contingency and emergency reserves in 2001 Excess (deficiency) of revenues and other sources over expenditures and other uses - budget basis General Fund 4,071,520 4,071,520 (5,078,795) 2,858,091 2,906,779 4.757,595 Special Revenue Funds (1)

(4,894,241) 1,346,691 (3,547,550) 1,988,153 (60,747)

(46.752)

(2,537,884) 1,526,756 "1(2,678,024)

(1) The special revenue funds that have legally adopted budgets are Aviation Asset Forfeiture, Balcones Canyonlands Conservation Plan, Child Safety, Disproportionate Share, EMS Travis County Reimbursed, Energy Conservation Rebates and Incntives, Environmental Remediation, Federally Qualified Health Center, Fee Waiver, Health and Human Services Travis County Reimbursed, Hotel-Motel Occupancy Tax, Municipal Court Building Security, Municipal Court Technology, Neighborhood Housing and Conservation, One Texas Center, PARD Cultural Projects, PARD Police Asset Forfeitures, Police Federal Seized Funds, Police SeizedJ Money, Public Improve'menrt District, Strategic Planning InvestmenIt, Sus,

tainability, Telecommunity Partnership, Tourism and Promotion, and Vehicle Rental Tax.

The following special revenue funds reported expenditures in excess of approlpriations, but did,not report a deficit fund balance:

Balcones Canyonlands Conservation Plan Federal Qualified Health Center 190,298 1,451,507 Although the debt service fund statements are prepared on a budget basis, no differences exist between GAAP basis and budget basis fund balance for these funds except for the amount of enterprise-related and certain departmental-related debt payments ($8,710,482) budgeted as operating transfers.

29

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 -

CITY OF AUSTIN, TEXAS (Continued) 3 - BUDGET BASIS REPORTING, continued c - Budget Amendments The original budget of the General Fund was amended several times during fiscal year 2001. The following table compares original to amended budgets:

Amendments Original Budget Increase (Decrease)

Amended Budaet REVENUES Taxes Franchise fees Fines, forfeitures and penalties Licenses, permits and inspections Charges for services/goods Interest and other Total revenues EXPENDITURES Administration Urban growth management Public safety Public services and utilities Public health:

Physician stipend/Charity care Medical Assistance Program hospital contracted services/patient services Other public health Public recreation and culture Social services management Nondepartmental expenditures Total expenditures TRANSFERS Operating transfers in Operating transfers out Total transfers Deficiency of revenues and other sources over expenditures and other uses

$ 259,543,305 259,543,305 28,002,200 28,002,200 16,684,955 16,684,955 16,953,748 16,953,748 11,324,483 (61,650) 11,262,833 8,479,022 478,880 8,957,902 340,987,713 417,230 341.404,943 9,744,905 12,859 9,757,764 16,194,366 (3,166,250) 13,028,116 210,856,890 7,118,743 217,975,633 6,165,431 3,946,348 10,111,779 10,495,146 10,495,146 6,108,237 6,108,237 26,101,710 (637,788) 25,463,922 47,897,4860-76,350 47,973,830 8,517,380 8,517,380 16,025,874 (6,548,884) 9,476,990 358,107,419 801,378 358,908,797 89,386,082' 3,496,594 92,882,676 (82,561,954)

(3,112,446)

(85,674,400) 6,824,128 384,148 7,208,276

$ (10,295,578)

(10,2951578)

The amended budget is presented in the accompanying financial statements. The General Fund budget includes other revenues and requirements, which are presented in the nondepartmental category. The amended expenditure budget for these' nondepartmental requireirnents includes the following: tuition reimbursement ($85,000), accrued payroll ($1,009,000),

expenses for workers' compensation ($5,810,516) and liability reserve ($2,500,000), and wage adjustment ($72,474).

30

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001

• CITYOF AUSTIN, TEXAS

"(Continued) 3-BUDGET BASIS REPORTING, continued I

There were budget amendments to the following special revenue'funds during fiscal year 2001:

Original Increase Budget (Decrease)

REVENUES EMS Travis County Reimbursed Federally Qualified Health Center Public Improvement District EXPENDITURES EMS Travis Cotdnty Reimbursed Federally Qualified Health Center Health and Human Services Travis County Reimbursed ' "

Neighborhood Housing and Conservation Public Improvement District OPERATING TRANSFERS IN Federally Qualified Health Center Neighborhood Housing and Conservation Public Improvement District OPERATING TRANSFERS OUT Federally Qualified Health Center Neighborhood Housing and Conservation 6,030,912 8,451,974 6,030,912 14,882,349 5,382,536 2,418,462 7,194,444 1,554,051 362,464 92,415 1,486,746 1,396,521 92,415 2,036,802 126,362 (411,000) 1,446,521 1,455,574 89,000 150,000 763,252 500,000

'6,123,327 9,938,720 1,396,521 6,123,327

'-16,919,151 5,508,898 "2,007,462 1,446,521 8,650,018 1,643,051 150,000 763,252 862,464 4 - DEFICITS IN FUND BALANCE AND RETAINED EARNINGS At September 30, 2001, the funds below reported deficits in fund balance or retained earnings. Marnagement intends to recover these deficits through future operating revenues, transfers or debt issues. Of the proprietary funds below, all except the Liability Reserve Fund have positive fund equity.

Special Revenue Funds:

Austin Transportation Study One Texas Center Voluntary Utility Assistance Capital Projects Funds.

Energy improvements - city, facilities Parks/Old Bakery Police facilities Street resurfacing Police substations Traffic signals Build Austin CMTA Mobility Public Works Tanglewood park City Hall, plaza, parking garage

'Conservation Land Colony Park Deficit

-Fund Balance Enterprise Funds:

147,250 Parks and Recreation' 555,355 59,518 Internal Service Funds:

"82,006

-490,544 13,785 54,298 253,964 4,397,286 114,762 248,274 106,447 64,197 4,961,211 4,551 11,509

,Employee Benefits Liability Reserve Workers Compensation, Deficit Retained Earnings 941,043 5,027,128 1,086,764 925,266 31 Amended Budget

- T

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continued) 5 - POOLED INVESTMENTS AND CASH The following summarizes the amounts of pooled investments and cash by fund type at September 30, 2001:

General Fund Special Revenue Funds Capital Projects Funds Enterprise Funds:

Electric Water and Wastewater Hospital Solid Waste Services Airport Convention Center Other Internal Service Funds Fiduciary Funds Subtotal pooled investments and cash Total pooled investments and cash Pooled Investments and Cash Unrestricted Restricted 35,120,932 57,155,129 127,703,177 56,571,935 11,904,032 35,173,831 2,389,996 5,012,442 17,981,848 4,823,114 53,308,192 8,112,717 415,257,345

$ 836,519,568 6 - INVESTMENTS AND DEPOSITS INVESTMENTS Chapter 2256, Texas Government Code (The Public Funds Investment Act) and the City of Austin Investment Policy authorize the City to invest in the following:

(1) obligations of the U.S. Treasury or its agencies and instrumentalities; (2) direct obligations of the State of Texas; (3) other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the State of Texas or the United States or its agencies and instrumentalities; (4) obligations of states, agencies, counties, cities, or other political subdivisions of any state rated A or better by a national investment rating firm; (5) certificates of deposit that are insured by the' Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation or its successor, or'secured by obligations described in (1) through (4) above, and having a market value of at least the principal amount of the certificates; (6) fully collateralized direct and reverse' repurchase agreements.

State statutes require that securities underlying repurchase agreements must liave a market value of at least 100% of the repurchase agreement's cost Money received by the City under the terms of a reverse security repurchase agreement may be'used to acquire additional authorized secunties, but the term of the authorized security acquired must mature not later than the expiration date stated in the reverse security repurchase agreement; (7) bankers acceptances accepted by a domestic bank maturing in 270 days or less from the date of its issuance and is rated at least A-i, P-1 by a national investment rating firm; (8) commercial paper with a stated maturity of 270 days or less from the date of its issuance and is either (a) rated not less than A-i, P-1 by at least two national investment rating firms, or (b) is rated at least A-i, P-1 by one national investment rating firm and is fully secured by an irrevocable letter of credit issued by a bank organized and existing under the laws of the United States or any state thereof; (9) SEC-regulated, no load money market mutual funds with a dollar weighted average portfolio maturity of 90 days or less and whose investment objectives include seeking to maintain a stable net asset value of $1 per share; (10) local government investment pools, such as the Texas Local Government Investment Pool, organized in accordance with Chapter 791, Texas Government Code (The Interlocal Cooperation Act), whose assets consist of the obligations described in (1) through (8) above. A public funds investment pool must be continuously rated no lower than AAA, AAA m or at an equivalent rating by at least one nationally recognized rating service; and 32 101,127,208 100,508,566 9,387,949 84,387,645 96,480,473 27,484,968 1,885,414 421,262,223

NOTES'TO COMBINEýD FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001

[(Continued) 6-INVESTMENTS AND DEPOSITS, continued (11)share certificates issued by state or federal credit unions domiciled'in Texas that are guaianteed or issued b*.<the National Credit Union Share Insurance Fund or its successor, or secured by obligations described under (1) through (4) above having a market value of at least the principal amount of the certificates.

The City follows GASB Statement 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools. This statement requires that governmental entities should report investments at fair value on the balance sheet, and that all investment income, including changes in the fair value of investments, should be reported as revenue in the operating statement. The change in investment value is reported on the balance sheet in either pooled investments and cash for investment pool participants, or in investments, for those -funds which hold their own investments; the'revenue is reported on the income statement in interest income.

The City participates in two Texas local government investment pools, TexPool and TexasTERM, which are external investment pools.

The State Comptroller of Public Accounts maintains oversight responsibility for TexPool.

This responsibility includes the ability to influence operations, designation of management, and accountability for fiscal matters.

TexPool bperates in almrriner consistent iith the SEC's Rule 2a7 of the Investment Company Act of 1940. The fair value of the City's position in TexPool is the same as the value of the shares the City holds. TexasTERM was established in conformity 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.

An advisory board, consisting of participants or their designees, maintains oversight responsibility. TexasTERM provides a fixed-term investment with a maturity of up to one year; therefore, the fair value of the City's position is equivalent to the carrying value.

The City did not particiliate in any reverse repurchase agreements during fiscal year 2001.

The City's investments (with exceptions noted below) are categorized below to give an indication of the level of risk (Category 1-lowest level of risk to Category 3-highest level of risk) assumed by the City at year-end. Category I includes investments that are insured or registered or for which the securities are held by the City's agent in the City's name. Category 2 includes uninsured and unregistered investments for which the securities are held by the counterparty's trust department or agent in the City's name. Category 3 includes uninsured and unregistered investments for which the securities are held by the City's trust department or agent, but not in the City's name.

Category Fair Investments Obligations of the U.S. government and its agencies Commercial paper Investments held by trustee Obligations of the U.S. government and its agencies Investments not categorized Money market mutual funds TexPool, Texas Local Government Investment Pool TexasTERM, Local Government Investment Pool Total investments 1

2 3

Value

$ 826,532,613 826,532,613 14,925,358 14,925,358 841,457,971 841,457,971 72,357,639 72,357,639

, 57,950,064.

383,490,260

-85,000,000 526,440,324 1,440,255,934 33

NOTESTO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 6 - INVESTMENTS AND DEPOSITS, continued Investments owned by the various funds of the City at September 30, 2001 are as follows:

Fair Change in Description Yields Value Fair Value NON-POOLED INVESTMENTS Money market mutual funds 3.29% -

3.35% $

724,043 Obligations of the U..S. government and its agencies 5.00% -

14.29%

423,533,793 16,686,459 TexPool, Texas Local Government Investment Pool 3.34%

160,418,696 TexasTERM, Local Government Investment Pool 4.04%

10,000,000 Total non-pooled investments 594,676,532 16,686,459 POOLED INVESTMENTS Money market mutual funds 3.14% -

3.35%

57,226,021 Obligations of the U.S. government and its agencies 5.29% -

5.78%

475,356,459 4,870,819 Commercial paper,

3.46%

14,925,358 TexPool, Texas Local Government Investment Pool 3.34%

223,071,564 TexasTERM, Local Government Investment Pool 3.59%

75,000,000 Total pooled investments '

845,579,402 4,870,819 TOTAL ALL INVESTMENTS DEPOSITS The September 30, 2001, carrying amount of deposits is as follows:

Cash Unrestricted 161,398 Restncted 246 Cash held by trustee Unrestricted 292,073 Restricted 5,213,934 Pooled cash 4,390,364 Total deposits

$ 10,058,015

$ 1,440,255,934 21,557,278 All bank balances were either insured or collateralized with securities held by the City or by its agent in the City's name.

7 - PROPERTY TAXES The City's property tax is levied each October 1 on the assessed value listed as of January 1 for all real and personal property located in the City. The adjusted assessed value for the roll as of January 1, 2000, upon which the 2001 levy was based, was

$41,419,314,286.

Taxes are due by January 31 following the October 1 levy date. Dunng the year ended September 30, 2001, 98.98% of the current tax levy (October 1, 2000) was collected. The statutory lien date is January 1.

The methods of property assessment and tax collection are determined by Texas statute. The statutes provide for a property tax code, county-wide appraisal districts, a State property tax board, and certain exemptions from taxation, such as intangible personal property, household goods, and family-owned automobiles.

34

t,

C, NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS

. (Continued) 7 - PROPERTY TAXES, continued The appraisal of property within the City is the responsibility of the Travis Central Appraisal DistricL' The appraisal district is required under the Prioperty Tax Code to assess all property within the appraisal district on the basis of 100% of its appraised value and is prohibited from applying any assessment ratios. The value of propertywithin the appraisal district must be reviewed every five ybers; however, the City may require more frequent reviews of appraised values at its own expense" The Travis Central Appraisal District has chosen 'to review the value of iýroperty every two years.

The City may challenge appraised values established by the appraisal district through various appeals and, if necessary,: legal iiction.

The City is authorized to set tax rates on property within the City limits. However, if the effective tax rate, excluding tax rates foir bonds, certificates of obligation, and other contractual oblig'ations, as adjusted for new improvements and revaluation, exceeds the rate for the previous year by more than 8%, qualified ývoters of the City may p~tition for an election' to determine whether to limit the tax rate increase to no more than 8%.

The City is permitted by Article II, Section 5 of the State of Texas Constitution to levy taxes up to $2.50 per $100 of assessed "valuation for gerneral govemmnental services, including the payment of principal and interest on'general obligation long-term debt. Under the City Charter, a limit on taxes levied for general governmental services, exclusive of payments of principal and interest on general obligation long-term debt, has been established at $1.00 per $100 assessed valuation. A practical limitation on taxes levied for debt service of $1.50 per $100 of assessed valuation is established by State Statute'and City Charter limitations. Through a contractual arrangement, Travis County bills and collects property taxes for the City.

The tax rate to finance general governmental purposes, other than the payment of principal and interest on general obligation long-term debt, for the year ended September 30, 2001, was $.3011 per $100 assessed valuation. The City has a tax margin for general governmental purposes of $.6989 per $100 assessed valuation, and could levy approximately $289,479,588 in additional taxes from the assessed valuation of $41,419,314,286 before the legislative limit is reached.

,8 - FIXED ASSETS Components of the City's fixed assets at September 30, 2001, are summarized as follows (in thousands of dollars):

Land and lad n"ts Buildings and improverrents Liachner and eqpmento Completed assets not classified Total plant in service Less acoux;nated deprecation Net property, plant and eqwsrrent in servo Construcbon inpres Nulear fuWl, net of anodazat Plant held for future use Total pioperty, plant and eqspment Water&

Solid Waste Convention Other internal General Electric Wastewater Hospital Services Airport Center Enterprise Service Fixed Fund Fund Fund Fund Fund Fund Funds Funds° Assets Total 34,352 135,154 760 10,462 58,691 26,089 2,760 485 190,379 459.132 561,747 1,323,647 74.017 10,127 639,014 83,775 16,259 3.530 219.095 2,931211 2,023,592 478,192 4

11,413 16,667 1,744 17,224 18,093 62458, 2629,387 203,389 158.323 13 20.977 10.271 3.385

-15,618 54.161 466.137 2,825.080 2095.316 74,794 52.979 724,643 114,993 51,861 76,269 471,932 6,485,867 (1,131,861)

(592,992)

(33.754)

(22,483) (126,438)

(24,599)

(12.648)

(26,697)

(1,971.472) 1,691.219 1,.52,324

-41.040 30,496 598.205 90.394 39,213 49,572 471.932 4,514,395 193,753 155.017 12,722 10,404 109,054 25,28 1,505 262,259 769,920 19,438 7..

19,438 31,379 31.76 1.935.789 1.657,341 41,040 43.218 608,609 199,448 64.419 51,077 734,191 5,335.132 The following table summarizes the changes in components of the General Fixed Assets Account Group for the year ended September 30. 2001:

Se tm e

30 1:

Balance, September 30, 2000 Additions Retirements Completed construction Transfers (to) from other funds Balance, September 30, 2001 I

improvements M achinery OtherThan

, and -,

Construction Land Buildings Buildings Equipment in Progress Total

$ 174,543,252 176,908,215 42,187,232 67.842,125 208.488.755 669,969,579 7

77,099,502 77,099,502 (2,811,509)

(6,770,497)

(3,253,421)

(12,835,427) 18,647,173 1,422,794 (20,069,967)

I...

(36,866)

(5.301) *

(42,167)

$ 190.378,916 176,908,215 42,187.232 62,457.556 262,259,568 734,191,487 35

NOTES TO COMBINED FINANCIAL STATEMENTS Septemnber 30, 2001 CITY OF AUSTIN, TEXAS (Continued) 8 - FIXED ASSETS, continued The City does not capitalize public domain general fixed assets. This accounting policy affects only the General Fixed Asset Account Group. During 2001, the City did not capitalize completed infrastructure assets amounting to $33,925,820.

Construction in progress includes various capital projects that are funded primarily by general obligation and revenue bonds.

The General Fixed Asset Account Group includes as construction-in-progress certain completed capital projects in service at September 30, 2001, which have not been unitized or capitalized pending classification to the proper fixed asset in-service categories. In all other funds, completed construction unclassified is included in property, plant and equipment.

The City anticipates the need for numerous additional utility-related projects over the next several years. However, the City has no formal commitments to projects other than those currently under construction.

Estimated unfunded future expenditures for capital projects will be funded from operations, issuance of additional general obligation or revenue bonds, or from alternative methods of financing.

The City has recorded capitalized interest for fiscal year 2001 in the following funds related to the construction of various capital improvement projects:

Solid Waste Services Airport Convention Center Drainage 800,393 1,237,475 3,090,193 106,500 9-- RETIREMENT PLANS a -- Description The City participates in funding three contributory, defined benefit retirement plans: City of Austin Employees' Retirement and Pension Fund, City of Austin Police Officers' Retirement and Pension Fund, and Fire Fighters' Relief and Retirement Fund of Austin, Texas. An independent board of trustees administers each plan. These plans are City-wide single employer funded plans that cover substantially all full-time employees. The fiscal year of each pension fund ends December 31. The most recently available financial statements of the pension funds are for the year ended December 31, 2000. Membership in the plans at December 31, 2000 is-as follows:

Retirees and beneficiaries currently receiving benefits and terminated employees entitled to benefits but not yet receiving them Current employees Total Total City Police Fire (Memorandum Employees Officers Fighters Only) 3,068 259 352 3,679 6,894 1.183 921 8,998 9,962 1.442 1.273 12.677 Each plan provides service retirement, death, disability and withdrawal benefits. State law governs benefit and contribution provisions. Amendments may be made by the Legislature of the State of Texas.

Financial reports that include financial statements and supplementary information for each plan are publicly available at the locations shown below.

Plan Address Telephone Employees' Retirement and Pension Fund 418 E. Highland Mall Blvd.

(512)458-2551 Austin, Texas 78752 Police Officers' Retirement and Pension Fund P.O. Box 684808 Austin, Texas 78768-4808 Fire Fighters' Relief and Retirement Fund 3301 Northland Drive, Suite 215 Austin, Texas 78731 (512)416-7672 (512)454-9567 36

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 "CITY OF AUSTINTEXAS

". t I(Continued) 9 - RETIREMENT PLANS, continued b - Funding Policy Authority establishing contributions obligation.

Frequency of contribution Employee's contribution (percent of earnings)

City's contnbution (percent of earnings)

City of Austin Employees' Retirement and Pension Fund' State Legislation Biweekly 8.0%

8.0% (1)

City of Austin Police Officers' Retirement and Fire Fighters' Relief Pension Fund and Retirement Fund State Legislation Biweekly 9.0%

180%

State Legislation Biweekly 13.70%

-.18.05%

(1) The City contributes two-thirds of the cost of prior service benefit payments.

While the contribution requirements are not actuarially determined, state law requires that a qualified actuary approve each plan of benefits adopted. The actuary of each plan has certified that the contribution commitment by the participants and the City provide an adequate financing arrangement. Contributions for fiscal year ended September 30, 2001, are as follows (in thousands):

city Employees Total contributions

City, Police Fire (Memorandum Employees Officers-Fighters

'Only) 24,118 10,738 8,429 43,285 24,118 5,369 6,398 35,885 48,236 16,107

-, 14,827, 79,170 c-Annual Pension Cost and Net Pension Obligation The City's annual pension cost of $43,285,000 for fiscal year ended September 30, 2001, was equal to the City's required and actual contributions. Three-year trend information is as follows (in thousands):

City Police Fire Employees - Officers Fighters City's Annual Pension Cost (APC):

1999 2000 2001 Percentage of APC contributed:

1999 2000 2001 Net Pension Obligation:

1999 2000 2001

,.17.513 8,907 20,458 9.834 24,118 8,429 100%

100%

100%

100%

100%

100%

7,722 7,984 10,738 100%

100%

100%

Total (Memorandum Only) 34,142 38,276 43,285 N/A N/A N/A 37

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS, (Continued) 9 - RETIREMENT PLANS, continued Actuarial valuations of the plans are performed every two years. Actuarial updates are done in each year following the full valuation.

The latest actuarial valuations were completed as of December 31, 1999.

The actuarial cost method and significant assumptions underlying the actuarial calculations are as follows:

City Employees Police Officers Actuarial Cost Method Asset Valuation Basis Inflation Rate Entry Age Actuarial Cost Method 5-year smoothed market 4%

Entry Age Actuarial Cost Method 5-year smoothed market 4%

Entry Age Actuarial Cost Method 5-year smoothed market 5.5%

Projected Annual Salary Increases Post retirement benefit increase Assumed Rate of Return on Investments Amortization method Remaining Amortization Period 4 5% to 14.5%

None 8%

Level percent of projected pay, open Not applicable 6.6% average None 8.25%

Level percent of projected pay, open 8.5 years 7%

3.5% effective January 1, 2001 through January 1.

2004 and, 0.5% annually thereafter 8%

Level percent of projected pay, open Not applicable d -- Trend Information (Unaudited)

Information pertaining to the latest actuarial valuations for each Plan is as follows (in thousands):

Valuation Date, December 31 st City Employees 1993 1995 1997 1999 Police Officers 1993 1995 1997 1999 Fire Fighters 1993 1995 1997 1999 Actuarial Value of Assets 579,100 707.300 856,423 1,105,100 97,093 127,572 168,602 226.913 175,612 213,403 268,241 341,593 Actuarial Accrued LUability 541,200 623,000 832,140 1,044,500 106,127 164,865 222,703 257,850 193,343 236,994 279.472 317,223 Unfunded Actuarial Accrued Liability (Excess)

(37,900)

(84,300)

(24,283)

(60,600) 9,034 37,293 54,101 30,937 17,731 23,591 11,231 (24,370)

Annual Funded Covered Ratio Payroll 107.0%

1135%

102.9%

105.8%

91.5%

77.4%

75.7%

88.0%

90.8%

90.0%

96.0%

107.7%

38 Fire Fighters Percentage of Unfunded Actuarial Accrued Liability (Excess) to Covered Payroll (16.1%)

(38.1%)

(11.1%)

(24 8%)

26.1%

103.0%

114.6%

56.6%

61.1%

72.6%

32.0%

(63 0%)

235,200 221,000 219,208 244,500 34.550 36,211 47,189 54,695 29.018 32,496 35,130 38,690

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30,2001 (Continued) 10- SELECTED REVENUES Effective October 1, 1995, the City entered into a long-term lease arrangement with the Daughters of Charity Health Services of Austin ("Seton") to operate City-owned Brackenridge Hospital. This lease agreement qualifies as an operating lease for accounting purposes. The lease agreement specifies a minimum lease payment, in addition to a supplemental rent payment based on approximately 46% of net disproportionate share revenue proceeds.

In fiscal year 2001,Ahe Hospital Fund revenues included minimum lease payments of $864,764 and additional rent of $5,385,433. The minimum lease payment includes an amendrnent approved by the City Council in November 2000 to reduce the amount of rent payment to the City by

$1,000,000 for fiscal year 2001. The reduction was used by Seton to expand facilities and services at Brackenridge Hospital and Children's Hospital of Austin.

The City participates in the Agreement Regarding Disposition of Tobacco Settlement Proceeds filed on July 24, 1998, In the case The State of Texas v. The American Tobacco Co., et al. Under the terms of the agreement, a political subdivision may receive a pro rata share of the annual amount of settlement proceeds distributed by the State of Texas. The City received proceeds of approximately $1.4 million in fiscal year 2001, which was recorded in the Hospital Fund.,

The City has entered Into certain lease agreements as lessor for concessions at the Airport. These lease agreements qualify as operating leases for accounting purposes. In fiscal year 2001, the Airport Fund revenues included minimum concession guarantees of $7,925,185.

The following is a schedule by year of minimum future rentals on noncancelable operating leases up to a term of thirty years for the Hospital Fund and twenty years for the Airport Fund as of September 30, 2001. Amounts for the Hospital Fund do not include supplemental rent payments as discussed above.

Fiscal Year Ended Hospital Airport September 30 Fund Fund 2002

$ 1,864,764

'9,199,981 2003 1,864,764 9,197,428 2004 1,864,764

- 8,625,182 2005 1,864,764 7,601,680 2006 1,864,764 7,598,557 Thereafter 35,430,516 20,939,151 Totals

$ 44,754,336 63,161,979 11 - GENERAL LONG-TERM DEBT a - General Obligation Debt - Capital Projects Funding Capital Iýrojects funds are used to account for'the acquisition and construction of general fixed assets. Capital projects are funde6d primarily by the issuance of general obligation debt, other tax supported debt, interest income and intergovernmental revenues.

General obligation debt is collateralized by the full faith and credit of the City and is reported as an obligation of the General Long-Term Debt Account Group (GLTDAG), except as described below.' The City intends to retire Its-general obligation debt, plus interest, from future ad valorem tax levies, and is required by ordinance'to create from guch tax revenues a sinking fund sufficient to pay the current interest due thereon arid each installment of irin-cipal as It becomes due. General obligation debt issued to fund fixed assets of proprietary funds is reported as an obligation of these proprietary funds, although the funds are not obligated 'by the 'applicable bond indentures to repay any portion of principal and interest on outstanding general obligation debt. However, the City intends for the prop*retary funds to meet the debt service requirements.,

As described In Note 7, State Statute and the City Charter establish a practical limit'ation of $1.50 "per $100 of assessed valuation on the debt service tax rate levied to service general obligation'debt, including Interest. The tax rate to finance the payment of principal and interest on general obligation lorg-term debt' for the 'year ended Septemnber 30, 2001,

'as' $.1652 per $100 assessed valuation. At September 30, 2001, allowable taxes related to debt service (assuming the rate of $1.50 per

$100 assessed valuation) are approximately $621,289,714, providing potential additional taxes for debt service of

$552,865,007 from the assessed valuation of $41,419,314,286.

39

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continued) 11 - GENERAL LONG-TERM DEBT, continued There are a number of limitations and restrictions contained in the various general obligation bond indentures. The City is in compliance with all limitations and restrictions.

The following table summarizes significant facts about general obligation bonds, certificates of obligation, contractual obligations, tax notes and assumed municipal utility district (MUD) bonds outstanding at September 30, 2001, including those reported in certain proprietary funds:

Series Series 1992 Series 1992 Series 1993 Senes1993 Series 1993 Senes 1993A Series 1994 Senes 1994 Series 1995 Series 1995 Series 1996 Series 1996 Taxable Series 1997 Series 1997 Senes 1997 Series 1997 Senes 1998 Assumed MUD Debt Series 1998 Series 1998 Series 1998 Senes 1999 Series 1999 Series 1999 Series 2000 Series 2000 Series 2001 Total Date Issued October, 1992 October, 1992 Felbruary, 1993 October, 1993 October, 1993 October, 1993 October, 1994 October, 1994 October, 1995 October, 1995 October, 1996 October, 1996 May, 1997 October, 1997 October, 1997 October, 1997 January, 1998 December, 1997 October, 1998 October, 1998 October, 1998 October, 1999 October, 1999 October, 1999 October, 2000 October, 2000 June, 2001 Original Issue

$ 52,490,000 5,405,000 71,600,000 25,000,000 6,435,000 70,230,000 33,260,000 3,550,000 30,250,000 8,660,000 30,550,000 11,755,000 18,400,000 29,295,000 13,975,000, 2,120,000 110,300,000 33,680,000 13,430,000 22,770,000 14,975,000 51,100,000 10,335,000 5,590,000 52,930,000 6,060,000 123,445,000 Amount Outstanding at September 30, 2001 3,000,000 250,000 62,945,000 18,960,000 4,880,000 52,850,000 5,500,000 475,000 2,185,000 1,550,000 13,625,000 4,675,000 15,400,000 28,515,000 7,570,000 1,850,000 110,090,000 16,641,011 13,330,000 20,800,000 10,990,000 50,690,000 8,455,000 5,245,000 51,245,000 5,890,000 120,755,000

$ 638,361,011 Aggregate Interest Requirements at' September 30, 2001 217,500 (1) 14,000(1) 15,982,533 (1) 6,288,039 (1) 1,618,869 (1) 10,398,370 (1) 696,000 (1) 51,065 (1) 596,920 (1) 218,100 (1) 5,899,063 (1) 339,530 (2) 2,333,400 (1) 17,221,816 (1) 698,850 (2) 908,213 (1) 50,535,613 (1) 11,560,668 (3) 7,830,075 (1) 10,151,223 (1) 1,187,522 (2) 37,845,500 (1) 1,240,800 (2) 3,091,538 (1) 40,488,600 (1) 3,605,694 (1) 31,641,531 (1)

Interest Rates Of Debt Outstanding at September 30, 2001 7.25%

56%

520- 5.75%

4 20- 4.75%

420- 4.75%

425-500%

520-600%

5.10 -5 70%

7.30- 7.75%

4 75 -6 00%

470-600%

4.70-480%

690-695%

500- 5.75%

4 50%

4.50 - 7.00%

3.95-5.25%

440-10.50%

4.40- 7.13%

4.10- 7.00%

3.90-4.25%

4.13-5.75%

4.50- 4.75%

500-6.00%

435-600%

500- 5.38%

450-550%

Maturity Dates Of Serial Debt 911/2002 9/112002 911/2002-2009 911/2002-2013 9/1/2002-2013 9/1/2002-2010 9/11/2002-2005 911/2002-2004 911/2002-2005 91112002-2005 911/2002-2011 11/1/2001-2003 311/2002-2004 9/1/2002-2017 11/1/2001-2004 9/112002-2017 9/112003-2016 11/15/2001-2021 9/1/2002-2018 9/1/2002-2018 11/1/2001-2005 9/11/2002-2019 11/11/2001-2006 911/2002-2019 914/2003-2020 9/1/2002-2020 9/11/2002-2022 (1) Interest Is paid semiannually on March 1 and September 1.

(2) Interest is paid semiannually on May 1 and November 1.

(3) Interest is paid four times a year on March 1, May 15, September 1, and November 15.

In October 2000, the City issued Public Improvement Bonds, Series 2000, in the amount of $52,930,000. Of the proceeds from the issue, $5,745,000 will be used for libraries, $1,000,000 will be used for asbestos abatement, $26,345,000 will be used for street improvements, $6,910,000 will be used for park and recreation facilities, $10,990,000 will be used for emergency centers, and $1,940,000 will be used for police forensics. These bonds will be amortized serially on September 1 of each year from 2001 to 2020. Certain of these bonds are callable beginning September 1, 2010. Interest is payable on March 1 and September 1 of each year, commencing March 1, 2001. Total interest requirements for these bonds, at rates ranging from 4.35% to 6.0% are $43,353,038.

40

'i ýý.

l*

IT FASTN EA NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS Septembrer 30, 2001 (Continued) 11 -- GENERAL LONG-TERM DEBT, continued In October 2000, the City issued Certificates of Obligation, Series 2000, in the amount of $6,060,000. Of the proceeds from the issue, $2,160,000 will be used for developer reimbursements and $3,900,000 will be used for land conservation. These certificates of obligation will be amortized serially September I of each year from 2001 to 2020.' Certain of these obligations

'are callable beginning September 1; 2010.' ý Interest is payable on March 1 and September 1 of each year,'commencing March 1, 2001. Total interest requirements for these obligations, at rates ranging from 5% to 5.38% are $3,920,300.

In June 2001, the City issued $123,445,000 in Public Improvement Refunding Bonds, Series 2001, with a weighted average interest rate of 5.17% to advance refund the following:

Weighted Average Interest Series Refunded Amount Rate Public Improvement Refunding Bonds, Series 1990A

$17,380,000 6.91%

Public Improvenment Refunding Bbnds, Series 1991A 880,000 5.88%

Public Improvement Refunding Bonds, Series 1992 3,000,000 7.25%

Certificates of Obligation, Series 1992

- 275,000 5.75%

Public Improvement Refunding Bonds, Series 1992 58,315,000 6.09%

Public Improvement Refunding Bonds, Series 1994 t3,500,000 5.57%

Certificates of Obligation, Series 1994 800,000 5.56%

Public Improvement Refunding Bonds, Series 1995 19,755,000 5.26%

Certificates of Obligation, Series 1995 4,420,000 5.25%

Austin Municipal Utility District No. 2 Unlimited Tax Bonds, Series 1991 1,635,000 8.15%

Circle C Municipal Utility District No. 3 Waterworks and Sewer System Combination Unlimited 760,000 5 38%

Tax and Revenue Bonds, Series 1996 Circle C Municipal Utility District No. 4 Waterworks and Sewer System Combination Unlimited -

1,950,000 5.64%

Tax and Revenue Bonds, Series 1994 Maple Run at Austin Municipal Utility District Unlimited Tax and Revenue Bonds, Series 1986 1,850,000 8.72%

North Cerntral Austin Growth Corridor Municipal Utility District No. 1 Waterworks Combination 520,000 6.38%

Unlimited Tax and Revenue Bonds, Series 1986 North Central Austin Growth Corridor Municipal Utility District No. 1 Waterworks and System 250,000 6.50%

Combination Unlimited Tax and Revenue Bonds; Series 1987 South Austin Growth Corridor Municipal Utility District No. 1 Unlimited Tax and Revenue Bonds,

-250,000" "6.00%

Series 1987 Southland Oaks Municipal Utility District Unlimited Tax and Revenue Bonds, Series 1995 2,840,000 6.10%

Southland Oaks Municipal Utility District Unlimited Tax and Revenue Bonds, Series 1996 1,470,000 5.96%

"Village at Western Oaks Municipal Utility District Unlimited Tax and Revenue Bonds, Series 1995 1,815,000-6.00%

'Village at Western Oaks Municipal Utility District Unlimited Tax and Revenue Bonds, Series 1996 1,580,000 5.88%,

Travis County Water Control and Improvement District No.12 Waterworks and Sewer System Tax

-45,000 5.00%

and Revenue Refunding Bonds, Series 1965 Travis County Water Control and Improvement District No.14 Waterworks and Sewer System Tax 70,000 5.00%

and Revenue Refunding Bonds, Series,1963 Travis County Water Control and Improvement District No.9 Refunding Bonds, Series 1962

""58,000 5.00%

The net proceeds of $128,476,463 (after issuer contribution of $105,332 and after payment of $303,373 in underwriting fees, insurance, and other issuance costs) were used to purchase U.S. government securities. Those securities were deposited in an irrevocable trust with an escrow agent to provide for all future debt service payments on the refunded bonds. As a result, the refunded bonds are considered to be legally defeased and the liability for the refunded bonds has' been removed from the financial statements.

The City advance refunded these bonds to reduce total debt service payments in the current period and in future years by approximately $7.1 million and to obtain an economic gain (difference between the present values of the debt service payments on the old and new debt) of approximately $6.3 million.

41

NOTES TO COMBINED FINANCIAL STATEMENTS Septernbter 30, 2001 CITY OF AUSTIN, TEXAS 11 - GENERAL LONG-TERM DEBT, continued The following is a summary of general obligation bonds, certificates of obligation, contractual obligation and tax note transactions of the City (including those of certain enterprise funds) for the year ended September 30, 2001 (in thousands of dollars), excluding assumed tax and revenue bond principal of $13,705,390 and Water and Wastewater note of $120,000 and premiums/discounts of ($28,924).

Balance payable-September 30, 2000 Refunding activity.

Refunding debt issued Outstanding debt defeased by refunding Balance payable subsequent to refunding Debt issued:

Parks and recreation Street improvements Libraries Health Department safety and welfare renovations Public safety Developer reimburseables Land conservation Debt issued during the year Debt retired during the year Balance payable-September 30, 2001 General Obligation Bonds and Other Tax Supported Debt General Long-Term Proprietary Debt Account Group Funds 550,039 56,124 106,234 17,211 (108,515)

(5,093) 547,758 68,242 6,910 26,345 5,745 1,000 12,930 2,160 3,900 58,990 (44,070)

(6,264) 562,678 61,978' General obligation bonds authorized and unissued amount to $435,155,000 at September 30. 2001.

Bond ratings at September 30, 2001, were Aa2 (Moody's Investor Services, Inc.), AA+ (Standard & Poor's) and AA+ (Fitch).

b - Other Long-Term Debt In addition to general obligation bonds,, certificates of obligation, contractual obligations, and tax notes, the General Long Term Debt Account Group includes all liabilities of the City (other than those reported in the propnetary funds) which are not due in the current period. Obligations include the following:

Descripton Accrued compensated absences Advances from other funds Loans payable:

HUD Section 108 loan (1)

Municipal Energy Conservation loan (2)

Long-term loan Other liabilities:

Arbitrage payable Grant liability Other Balance September 30, 2000 Increase (Decrease)

Balance September 30, 2001 47,885,622 1,526,675 49,412,297 4,318,000 4,318,000 7,305,000 (285,000) 7,020,000 1,905,660 (517,534) 1,388,126 2,800,000 2,800,000 2,601,957 2,601,957 500,000 500,000 1,272,149 11,272,149 61,414,282 7,898,247 69,312,529 (1) Interest payable In the amount of $3,837,734 at September 30, 2001.

(2) Interest payable in the amount of $85,242 at September 30, 2001.

42

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 12 - ENTERPRISE FUNDS - REVENUE* BONDS AND OTHER LONG-TERM DEBT

-a - Combined Utility Systems Debt -- General I I I

The City's Electric Fund and Water and Wastewater Fund comprise the "Combined Utility Systems," which Issue Combined Utility Systems revenue bonds to fund Electric Fund and Water and Wastewate'r Fund capital projects. 'Principal and interest on these bonds are payable solely from the combined net revenues of the Elebtric Fund and Water and Wastewater Fund.

The followirg table summarizes Combined Utility Systems revenue bonds and other long-te6m financing trarnsactions for the year ended September 30, 2001 (in thousands of dollars):

Description Prior Lien Subordinrate' (Net of discount and Inclusive of premium)

Bonds Lien Bonds Total Balance payable, October 1, 2000

$ 1,950,526 323,587 2,274,113 Debt repaid, defeased, or refunded (64,592)

(36,765)

(101,357)

Amortization of bond discount and premium 1,681 (272) 1,409 Balance payable, September 30, 2001

$ 1,887,615 286,550 2,174,165 The total Coribined Utility Systems revenue bond obligations at September 30,2001, exclusive of discounts and premiums, consist of $1,902,370,731 prior lien bonds and $280,854,512 subordinate lien bonds. Aggregate interest requirements for all prior liens and subordinate lien bonds are $1,515,477,155 at September 30, 2001. Revenue bonds authorized and unissued amount to $1,492,642,660 at that date. Bond ratings at September,30, 2001 for the prior lien and subordinate lien bonds were, respectively, A2 and A2 (Moody's Investor Services, Inc.), A and A- (Standard & Poor's), and A+ and A+ (Fitch).

b - Combined Utility Systems Debt - Revenue Bond Indenture Requirements The City is required by bond indentures to pledge the net revenues of the Combined Utility Systems for debt service, and is required to maintain debt service funds and bond reserve funds foraill outstanding revenue bonds. The debt service funds, with assets of $308,946,379 including accrued interest at September 30, 2001, are restricted within the utility systems and require that the net revenues of the systems, after operating and maintenance expenses are deducted, be irrevocably pledged by providing equal monthly installments that will accumulate to the semiannual principal and interest requirements as they become due.

The bond reserve fund for revenue bond retirement, with assets of $170,699,819 of investments at fair value at September 30, 2001, is also'restricted within the utility systems. The City is required to maintain a combined reserve fund for'the benefit of the holders of prior lien bonds and subordinate lien bonds, which must contain cash and Investments of not less than

$85,000,000 arnd which shall be increased upon the issuance of any additional bonds to the greater of such amount or the average annual principal and interest reiluirements on all prior lien" bonds and subordinate lien bonds. Additional amounts required to be dep6sited in the reserve fund must be funded from borid proceeds or accumulated in the reserve fund in equal monthly installments within 60 months from the date of delivery of the additional bonds.

The City also covenants under the bond indentures that the custodian of the reserve fund shall be an official City depository and investment of the reserve fund shall be in direct or guaranteed obligations of the United States of America (USA),

Including obligations guaranteed by the USA, and certificates of deposit of any bank or trust company, the deposits of which are fully secured by a pledge or obligation of the USA or guaranteed by the USA. The ievenue bond indentures also provide for a number of other limitations and restrictions. The City is in compliance with all significant limitations and restrictions contained in the revenue bond indentures.

c -- Combined Utility Systems Debt

- Revenue Bond Refunding Issues The Combined Utility Systems have refunded various issues of revenue bonds, notes, and c'ertificates of obligation through refunding revenue bonds. Principal and Interest on these refunding bonds are payable solely from the combined net revenues of the City's Electric Fund and Water and Wastevwater Fund."

The prior lien bonds are subordinate only to the prior lien revenue bonds outstanding at the time of Issuance, while the subordinate lien bonds are subordinate to prior lien revenue bonds and to subordinate lien revenue bonds outstanding at the time of issuance.

'43

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continuedi 12 - ENTERPRISE FUNDS - REVENUE BONDS AND OTHER LONG-TERM DEBT, continued Some of these bonds are callable prior to maturity at the option of the City. The term bonds are subject to a mandatory redemption prior to the maturity dates as defined in the respective official statements.

The net proceeds of each of the refuriding bond issuances were used to purchase U.S. government securities. Those securities were deposited in an irrevocable trust with an escrow agent to provide for all future debt service. As a result, the refunded bonds are considered to b6 legally defeased and the liability for the refunded bonds has been removed from the financial statements. The accounting gains and losses due to the advance refunding of debt have been deferred and are being amortized over the life of the refunding bonds by the straight-line method. However, a gain or loss on refunded bonds is recognized when funds from current operations are used.

d - Combined Utility Systems Debt - Bonds Issued and Outstanding The following schedule shows all original and refunding revenue bonds outstanding at September 30, 2001 (in thousands of dollars):

Series 1982 Refunding 1986 Refunding 1987 1989 1990 1990AB Refunding 1991A Refunding 1992 Refunding 1992A Refunding 1993 Refunding 1993A Refunding 1994 1994 Refunding 1995 Refunding 1996AB Refunding 1997 Refunding 1998 Refunding 1998A Refunding 1998 Refunding 1998 Bonds Dated March 1982 March 1986 May 1987 July 1989 August 1990 February 1990 June 1991 March 1992 May 1992 February 1993 June 1993 May 1994 October 1994 June 1995 S6ptember 1996 August1997 August 1998 August 1998 November 1998 November 1998 Original Amount Issued 598,000 545,145 65,000 65,800 6,395 236,009 57,080 265,806 351,706 203,166 263,410 3,500 142,559 151.770 249,235 227,215 180,000 123,020 245,315 10,000 Outstanding at September 30, 2001 19,315 34,490 1,720 2,670 4,055 33,962 32,310 232,966 310,471 168,911 189,341 2,790 107,159 46,670 247,265 218,210 177,160 99,065 245,080 9,615

$ 2,183,225 a - Combined Utility Systems Debt - Commercial Paper Notes The City is authorized by ordiriance' to issue commercial paper notes in an aggregate principal amount not to exceed

$350,000,000 outstanding at any one time. Proceeds from the notes are used to provide interim financing for capital project costs for additions, improvements, and extensions to the City's electric system and the City's water and wastewater system and to refinance, renew, or refund maturing notes and other obligations of the systems. Note ratings at September 30, 2001 were P1 (Moody's Investor Services, Inc.), Al (Standard & Poor's), and F1 (Fitch).

The notes will be in denominations of $100,000 or more and mature not more tan 270 days from the date of issuance.

Principal and interest on the notes are payable from the combined net revenues of the City's Electric Fund and Water and Wastewater Fund.

44 I

NOTES TO COMBINED FINANCIAL STATEMENTS CITY-OF AUSTIN, TEXAS September 30, 2001 (Continued) 12-ENTERPRISE FUNDS -' REVENUE BONDS AND OTHER LONG-TERM DEBT, continued At September 30, 2001, the Electric Fund had outstanding commercial paper notes of $77,084,000'and the Water and.

Wastewater Fund had $78,226,000, of commercial paper notes outstanding. Interest rates on the notes range from 2.20% to 3.20%, and subsequent issues cannot exceed the maximum eate of 15%.' The City inten'ds to refinance maturing commercial paper notes by issuing additional commercial paper notes or by issuing long-term debt.

f-Combined Utility Systems Debt - Taxable Commercial Paper Notes The City is authorized bi-ordinarnce to is~sue'taxable commercial palerf notes, (the 'taxable n*otes"), in an-aggregate principal amount not to exceed $160,000,000 outstanding at any one time. Proceeds from the taxable notes are used to provide interim financing for capital project costs for additions, improvements, and extensions to the City's electric system and the City's water and wastewater system and to refinance, renew, or refund maturing notes and other obligations of the.systems.

Note ratings at September 30, 2001 were P1 (Moody's Investor Seivices," Inc.), A1+ (Standard & Poor's), and Fl+(Fitch).

The taxIable notes will be in denominations of $100,000 or more and maturei not more than 270 days from the date of issuance. -Principal and interest on the taxable notes are payable from the combined net revenues of the City's Electric Fund and Water and Wastewater Fund.

At September 30, 2001, the Electric Fund had outstanding taxable notes of $73,158,720 (net of discount of $460,280), and the Water and Wastewater Fund had no taxable notes outstanding. Interest rates on the taxable notes range from 3.65% to 3.69%. The City intends to refinance matunng commercial paper notes by issuing long-term debt-.

g - Electric System Revenue Debt -General The City is authorized by ordinance to issue electric system revenue obligations. Proceeds from these obligations are used only to fund electric capital projects or to refund debt issued to fund these capital projects. Principal and interest on these obligations are payable solely from the net revenues of the Electric Fund. The following table summarizes the electric system revenue bonds for the year ended September 30, 2001 (in thousands of dollars):

Description Separate Lien (Net of discount and Inclusive of premium on refunding)

Bonds.

Balance payable, October 1, 2000 Debt issued 126,944 Amortization of bond discount and premium 4

Balance payable, September 30, 2001 126,948 h

Electric System Revenue Debt L-Revenue Bond Indenture Requirements From 'July 18, 2000 forward, all revenue bbligations, other'than,commercial paper obligations," to finance -capital improvements for the electric system shall be payable from and secuied only by a lien on and pledge of the net revenues of the electric system. Electric system revenue debt is subject to the prior claim on 'and lien on the net revenues of the electric system for the payment of the Combined Utilitj System Debt (see note 12-a).

I - Electric System Revenue Debt - Revenue Bond Refundiing Issues The City was authorized by ordinance to issue Electric Utility System Revenue Refunding Bonds, in an aggregate principal amount of $126,700,000. Proceeds from the bond refunding were used to convert $125,000,000 of outstanding Combined Utility System Commercial Paper Notes, Series A, to long-term debt of the electric utility system. The refunding resulted in future debt service requirements of $136,721,574.' No economic gain or loss was recognized on this transaction. Bond ratings at September 30, 2001 were A3 (Moody's Investor Services, Inc.), A- (Standard & Poor's), and A (Fitch).

45

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 12 - ENTERPRISE FUNDS - REVENUE BONDS AND OTHER LONG-TERM DEBT, continued J - Electric System Revenue Debt - Bonds Issued and Outstanding The following table summarizes all electric system original and refunding revenue bonds outstanding at September 30, 2001 (in thousands of dollars):

Original Amount Outstanding at Series Bonds Dated Issued September 30, 2001 2001 Refunding February 2001

$126,700

$126,700 k - Water and Wastewater System Revenue Debt - General The City is authorized by ordinance to. issue water and wastewater system revenue obligations. Proceeds from these obligations are used only to fund water and wastewater capital projects or to refund debt issied to fund these capital projects.

Principal and interest on these obligations are payable solely from the net revenues of the Water and Wastewater Fund. The following table summarizes the water and wastewater system revenue bonds for the year ended September 30, 2001 (in thousands of dollars):

Description Separate Lien (Net of discount and inclusive of premium on refunding)

Bonds Balance payable, October 1, 2000 100,015 Debt issued 225,809 Amortization of bond discount and premium 5

Balance payable, September 30, 2001 325,829 I - Water and Wastewater System Revenue Debt - Revenue Bond Indenture Requirements From July 18, 2000 forward, all revenue obligations, other than commercial paper obligations, to finance capital improvements for the water and wastewater system shall be payable from and secured only by a lien on and pledge of the net revenues of the water and wastewater system. Water and wastewater system revenue debt is subject to the prior claim on and lien on the net revenues of the water and wastewater system for the payment of the Combined Utility System Debt (see note 12-a).

m - Water and Wastewater System Revenue Debt - Revenue Bond Refunding Issues and Defeasance The City was authorized by ordinance to issue $152,180,000 of Water and Wastewater System Revenue Bonds, Series 2001A and $73,200,000 of Water and Wastewater System Revenue Refunding Bonds, Series 2001B. Proceeds from the Series 2001A bonds were used to refund $150,000,000 of Commercial Paper Notes, Series A, and $2,625,000 of Circle C Municipal Utility District No. 4 Contract Revenue Bonds, Series 1990.

The Series 2001B bonds were used to refund

$57,650,000 of tax-exempt Commercial Paper Notes, Series A and $15,012,552 of taxable Commercial Paper Notes. The debt service requirements on the refunding bonds were $237,942,341. No economic gain or loss was recognized on these transactions.

An accounting'loss of $436,094, which will be deferred and amortized in accordance with Statement of Financial Accounting Standards No. 71, was recognized on the refunding. Bond ratings at September 30, 2001 were A2 (Moody's Investor Services, Inc.), A- (Standard & Poor's), and A+ (Fitch).

On May 1, 2001, the City defeased $9,235,000 in Circle C Municipal Utility District No. 3 Contract Revenue Bonds, Series 1996. The Water and Wastewater Fund placed $9,651,944 in an irrevocable escrow account that was used to purchase U.S.

Govemment obligations to provide for all future debt service payments on defeased bonds. The bonds are considered to be legally defeased and the liability has been removed from these financial statements. There was no economic gain or loss recognized on this transaction; an accounting loss on the defeasance of $141,818 was recognized.

46

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS

, (Continued) 12 - ENTERPRISE FUNDS L-'REVENUE BOiNDS A4ND OTHER LONG-TERM DEBT,'con-tin-ued n - Water and Wastewater System Revenue Debt - Bonds Issued and Outstanding The following table summarizes all water and wastewater system original and refunding revenue bonds outstanding at September 30, 2001 (in thousands of dollars):

Series.

2000 Refunding 2001A Refunding 2001B Refunding Bonds Dated June 2000 June 2001 June 2001 Original Amount Issued

'$100,000 152,180 73,200 Outstanding at September 30, 2001 100,000 152,180

-73,200 325,380 o - Water and Wastewater Fund - Refunds Payable on Construction Contracts Refunds payable,on construction contracts of approximately $279,041 at September 30, 2001, excluding accrbed interest, represent 'contractual obligations of the Water and Wastewater Fund to refund,a percentage 'of certain construction costs incurred by developers. The contracts vary as to terms and conditions.

p - Airport, - General The City's Airport Fund issues Airport System revenue bonds to fund Airport Fund capital projects. Principal and interest on these bonds are payable solely from the net revenues of the Airport Fund. The following table summarizes Airport System revenue bonds for the year ended September 30, 2001 (in thousands of dollars):

Description I I (Net of discount and loss on refunding)

Balance payable, October 1, 2000 Prior Lien

'-Bonds

$ 364,477 Amortization of bond discount and loss on refunding 560 Balance -payable, Septembe& 30, 2001

$ 365,037 The total Arlrrrt Systenm obligation for prior lien bonds is $374,245,000, exclusive of discount bnd loss 'on refunding, at September 30,ý 2001. Aggregate interest requirements for all prior lien bonds are $359,378,396 at September 30, 2001.

Revenue bonds authorized and unissued amount to $735,795,000 at that date.

q - Airp*rt' -Revenue Bond Indenture Requirements The City is required by bond Indentures to pledge the net revenues of the Airport System for debt service, and is required to maintain a debt service fund and bond reserve fund for all outstanding revenue bonds.-,The debt service fund, with assets of

$11,390,843 including accrued interest at September 30, 2001, is restricted within the Airport System and requires that the net revenues of the airport, after operating and maintenance expenses are deducted, be irrevocably pledged by providing equal monthly installments that will accumulate to the semiannual principal and interest requirements as they become due.

The City is also required to maintain a reserve fund for the benefit of the holders of prior lien bonds, which must contain cash and investments equal to the arithmetic average of the debt service requirements scheduled to occur in the then current and future fiscal years for all prior lien bonds then outstanding. The bond ordinance allows for the use of a debt service reserve fund surety bond in lieu of the cash deposit. The City holds a surety bond with a total benefit available of $30,429,177. The City is in compliance with all significant limitations and restrictions contained in the revenue bond indentures available in the event a draw is necessary.

' 47 J

4

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continrued) 12 - ENTERPRISE FUNDS - REVENUE BONDS AND OTHER LONG-TERM DEBT, continued r - Airport Debt - Bonds Issued and Outstanding The following schedule shows all original and refunding revenue bonds outstanding at September 30, 2001 (in thousands of dollars):

Series 1989 1995A 1995B Refunding Bonds Dated September 1989 August 1995 August 1995 Original Amount Issued 30,000 362,205 31,040 Outstanding at September 30, 2001 1,000 342,205 31,040 374,245 s -- Airport Debt - Variable Rate Revenue Notes The City is authorized to issue Airport System variable rate revenue notes, pursuant to Ordinance No. 950817B, as amended and restated by Ordinance 980205A adopted by the City Council on February 5, 1998. At September 30, 2001, the Airport System had outstanding variable rate revenrue notds of $28,000,000. The debt service fund required by the bond ordinance held assets of $392,997 including accrued interest at September 30, 2001 and was restricted within the Airport System.

During fiscal year 2001, interest rates on the notes ranged from 1.95% to 5.50%, adjusted weekly, and subsequent rate changes cannot exceed the maximum rate of 15%. Principal and interest on the notes are payable from the net revenues of the Airport System.

t - Convention Center - General The City's Convention Center Fund issues Convention Center revenue bonds and Hotel Occupancy Tax revenue bonds to fund Convention Center Fund capital projects. Principal and interest on these bonds are payable solely from pledged hotel occupancy tax revenues and the special motor vehicle rental tax revenues. The following table summarizes the Convention Center Fund revenue bonds for the year ended September 30, 2001 (in thousands of dollars):

Description (Net of discount, premium and loss on refunding)

Balance payable, October 1, 2000 Debt repaid Amortization of bond discounts, premiums, and loss on refunding Balance payable, September 30, 2001 Prior Lien Bonds

$ 131,787 (2,945)

Subordin*

Lien Bon 109,7 ate ds Total

'17 241,504 (2,945) 632 (15) 617

$ 129,474 109,702 239,176 The total Convention, Center obligation for prior and subordinate lien bonds is $247,940,000, exclusive of discounts, premiums and loss on -refunding, at September 30, 2001. Aggregate interest requirements for all prior and subordinate lien bonds are $229,850,575 at September 30, 2001.

Revenue bonds authorized and unissued amount to $760,000 at September 30, 2001.

48

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 12 - ENTERPRISE FUNDS - REVENUE BONDS AND OTHER LONG-TERM DEBT, continued u - Convention Center - Revenue Bond Issues and Indenture Requirements The City is required by bond indentures to pledge the hotel occupancy tax revenue for debt srvice, and Is req"ired to maintain a debt service fund and either a bond reserve fund or a debt service reserve fund suretj bond The debt service fund, with assets of $5,341,486 at September 30, 2001,,is restricted within the Convention Center and requires that the pledged hotel occupancy revenues of the Convention Center-be'irrevocably pledged by providing 4uarterly installments that will accumulate to the semiannual principal and interest requirements as they become due. The debt service reserve fund, with assets of $6,914,551 at September 30, 2001, is required to maintain cash and investments that must equal the lesser of 10% of the principal amount or the maximum annual debt service requirement scheduled to occur In the current and each future fiscal year for all bonds'outstanding. All other debt service requirements have been satisfied with the purchase of surety bonds. The City is in compliance with all significaht limitations contained in the revenue bond indentures.

In November 1999, the City issued the Town Lake Community Events Center Venue Project Bonds, Series 1999, in the amount of $40,000,000. The Series was issued to construct the Town Lake Community Events Center and a parking facility.

The debt is secured and payable from the levy of the Special Motor Vehicle Rental Tax, a 5% tax on the gross rental receipts on the short-term motor vehicle rentals within the City. The City established a debt service fund, with assets of $606,656 at September 30, 2001 to service principal and interest payments. The City maintains as a reserve requirement, a surety bond issued at the date of delivery of the bonds.

v-- Convention Center Debt - Bonds Issued and Outstanding The following schedule shows all original and refunding revenue bonds outstanding at Septernbefr 30, 2001 (thousands of dollars):

Original Amount Outstanding at Series Bonds Dated Issued,

Septeniler 30, 2001 1993A December 1993 75,955 67,940 1999 Refunding June 1999 6,445 5,000 1999A.

June 1999 25,000 25,000 1999 September 1999 110,000 110,000 1999 November 1999 40,000 40,000

"$ 247,940 13 - CONDUIT DEBT To provide for low cost housing and for acquisition and construction of industrial and commercial facilities, the City has issued several series of housing and industrial development revenue bonds. These bonds are secured by the property financed and are payable solely from payments received on the underlying mortgage loans. Prior to September 30, 1997 the City issued several series of bonds; the aggregate principal amount payable of these bonds could not be determined; however, their original issue amounts totaled $310.2 million Since 1997, the City has'issued various series of bonds, with the'original Issues totaling $47 million, and $46.5 million outstanding at September 30, 2001.

To provide for facilities located at the airport and convention center, the City has issued various facility revenue bonds. These bonds are special limited obligations of the City, payable solely from and secured by a pledge of revenue to be received from agreements between the City and various third parties.

The original issues totaled $366 Wmillion, with $364.3 million outstanding at September 30, 2001.

The above bonds do not constitute a debt or pledge of the faith and credit of the City and accordingly have not been reported in the accompanying financial statements.

49

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continued) 14 - DEBT SERVICE REQUIREMENTS The following Is a schedule of General Obligation Bonds and Other Tax Supported Debt requirements for the General Long-Term Debt Account Group (in thousands):

Fiscal Year Ended General Obligation Bonds (1)

September 30 Principal Interest Total Public Property Finance Contractual Obligations Principal Interest Total Certificates of Obligation Principal Interest Total 39.309 28,210 67,519 37,734 26,258 63,992 39,634 24,356 63,990 41,852 21.958 63,810 42,700 19,863 62.563 335,397 106,749 442,146 536,626 227,394 764,020-7,160 7.680 7,225 5,550 3,205 "870 31,690 1,320 8,480 994 8,674 650 7,875 350 5,900 132 3,337 21 891 3,467 35,157 Fiscal Year Ended Tax Notes September 30 Principal Interest Total 1.500 1.900 12,000 1,017 2,517 900 2,800 416 12,416 15,400 2,333 17,733 Less: Amounts reported in Enterpnse Funds Amounts reported in Internal ServIce Funds Total requirements reported In other funds, exclusive of discounts, loss on refundings and premiums General Long-Term Debt Account Group requirement at September 30, 2001 2,230 2.045 4,275 2,095 1.913 4,008 2,220 1.788 4,008 2,165 1,661, 3,826 1,835 1,562 3,397 30,395 10,689 41,084 40,940 19,658 60,598 Total Principal Interest Total 50,199 32,592 82,791 49,409 30.065 -

79.474 61,079 27,210 88,289 49,567 23,969 73,536 47,740 21,557 69,297 366,662 117,459 484,121 624.656 252.852 877,508 (55,926)

- (17.902)

(73,828)

(6,052)

(1,467)

(7,519)

(61,978)

(19,369)

(81,347) 562,678 233,483 796,161 (1) General Obligation Bonds exclude Tax Supported Debt of $69,312,529 (see Note 11-b).

2002 2003 2004 2005 2006 Thereafter (3i M

2002 2003 2004 2005 2006 Thereafter

NOTES TO COMBINED FINANCIAL STATEMENTS Seotember 30. 2001 CITY OF AUSTIN, TEXAS (Continued) 14-DEBT SERVICE REQUIREMENTS, continued The following summarizes the proprietary funds debt service obligations at September 30, 2001 (in thousands):

Fiscal Year Ended Commercial Paper Notes (1)

Revenue Notes (2)

September30 Principal -

Interest'

--Total Principal Interest Total 2002 228,929 1,306 230,235 1,680 1,680 2003 1,680 1,680 2004 1,680 1,680 2005 1,680 1,680 2006 r

1,680 1,680 Thereafter 28,000 19,320 47,320 228,929 1,306 230,235 28,000 27,720 55,720 Less: Unamortized bond discount (460)

(460)

Unamortized loss on bond refundings Add:

Unamortized bond premium Net debt service requirements,-

228,469 1,306 229,775 Fiscal Year General Obligation Bonds Ended,

and Other Tax Supported Debt (3)

Revenue Bonds September 30 Principal Interest Total Principal Interest,

Total -

2002 2003 2004 2005 20066 Thereafter Less:

Unamortized bond discount "Unamortized loss on bond refundings Add:

Unamortized bond premium Net debt service requirements 9,178 8,752 8,294 7,770 4,969 36,842 4,464 4,059 3,663 3,109 2,775 11,107 13,642 12,811 11,957 10,879 7,744 47,949 75,805 29,177 104,982 (224)

(224)

(843)

(843) 1,094 1,094 75,832 29,177 105,009 105,219 90,525 137,236 157,092 166,619 2.600.797 193,419 182,901 167,619 154,516 145,083 1.746.249 298,638 273,426 304,855 311,608 311,702 4.347.046 3,257,488 2,589,787 5,847,275 (54,318)-

(54,318)

(8,113),

(8,113) 36,099

. 36,099 3,231,156 2,589,787 5,820,943 (continued)

(1) The City intends to refinance maturing commercial paper notes by issuing additional commercial paper notes or by issuing long-term debt.

(2) These are variable rate notes with 6% Interest (3) Includes assumed tax and revenue bond principal of $13,705,390 and Interest of $9,808,616 and

$120,000 of Water and Wastewater notes payable.

51

NOTES TO COMBINED FINANCIAL STATEMENTS Septeimber 30, 2001 CITY OF AUSTIN, TEXAS 14 - DEBT SERVICE REQUIREMENTS, continued Fiscal Year Water Improvement Municipal Utility District Ended District Bonds Contract Revenue Bonds September 30 Principal Interest Total Principal Interest Total 2002 250 13 263 6,605 4,563 11.168 2003 7.405 4,140 11,545 2004 8,045 3,664 11,709 2005 8,770 3,140 11,910 2006 9,385 2,573 11.958 Thereafter 36,515 4,419 40,934 250 13 263 76,725 22,499 99,224 Less:

Unamortized bond discount (262)

(262)

Unamortized loss on band refundings Add:

Unamortized bond premium Net debt service requirements 76.463 22,499 98,962 Fiscal Year Total Ended Debt Service Requirements September 30

- Principal Interest Total 2002 2003 2004 2005 2006 Thereafter Less:

Unamortized bond discount Unamortized loss on bond refundings Add:

Unamortized bond premium Net debt service requirements 350,181 205,445 555,626 106,682 192,780 299,462 153,575 176,626 330,201 173,632 162.445 336,077 180,973 152,111 333,084 2,702,154 1,781,095 4,483,249 3,667,197 2,670,502 6,337,699 (55,264)

(55,264)

(8,956)

(8.956) 37,193 37,193

$ 3,640,170 2,670,502 6,310,672 52

-2

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continued) 14-DEBT SERVICE REQUIREMENTS, continued

, I The following summarizes the proprietary funds debt service requirements at September 30, 2001 by fund (in thousands):

Electric (1)

Princioal

'Interest

-Total 231,489 96,681 328,170 67,543 90,030 157,573 92,297 77,094 169,391 101,125 66,094 167,219 101,642 60,240 161,882 1,063,003 570,545 1,633,548 1,657,099 960,684

-2,617,783 Less:

Unamortized bond discount "Unamortized loss on bond refundings Add: _ Unamortized bond premium Net debt service requirements Fiscal Year

-Ended September 30 (22,743)

(22,743) 25,322 25,322 1.659,678

ý 960,684 2,620,362 Solid Waste Services Principal Interest Total 1.962 1,900 1.888 1,677 909 11,428 19,764 Less:

Unamortized bond discount Unamortized loss on bond refundings Add: -_ Unamortized bond premium Net debt service requirements' 986 883 784 686 609 3,414 7,362 2,948 2,783 2,672 2,363 1,518 14,842 27,126 (31)

(31)

(710)

(710) 296 296 19,319 7,362 26,681 Water and Wastewater (2)

Princlial Interest Total 108,336 68,887 177,223 26,295 63,484 89,779 44,985 61,039 106,024 55,571 58,779 114,350 62,513 55,281 117,794 1,023,798 771,655 1,795,453 1,321,498 1,079,125 2.400,623 (22,080)

(22,080) 10,886 C

-10,886 1,310,304

-1,079,125 2,389,429 Airport Principal Interest Total 3,387 24,426 27,813 5,765 24,173 29,938 7,316 23,806 31,122 7,759 23,361 31.120" 8,473 22,846 31,319 370,495 268,775 639,270, 403,195 387,387 790.582 (7,614)

(7,614)

(1,557)

(1,557) 18 18 394,042 387,387 781,429 (continued)

(1) Included in the debt service requirements of Electric is $150,703,000 principal and $1,001,252 interest for commercial paper notes.

(2) Included In the debt service requirements of Water and Wastewater is $78,226,000 principal and $304,367 Interest for commercial paper notes.

53 Fiscal Year Ended S~nt*_mb~r :30, 2002 2003 2004 2005 2006 Thereafter 2002 2003 2004 2005 2006 There fter Sentember 30

NOTES TO COMBINED FINANCIAL STATEMENTS September30, 2001 CITY OF AUSTIN, TEXAS (Continued*

14 -- DEBT SERVICE REQUIREMENTS, continued Fiscal Year Ended Convention Center Drainage September 30 Principal Interest Total Principal Interest Total 2002 3,146 13,649 16,795 187 109 296 2003 3,315 13,487 16,802 190 99 289 2004 5,275 13,269 18,544 166 89 255 2005 6,131 12,976 19,107 155 79 234 2006 6,544 12,644 19,188 105 72 177 Thereafter 224,037 163,996 388,033 1,417 453 1.870 248,448 230,021 478,469 2,220 901 3,121 Less:

Unamortized bond discount (2,781)

(2,781)

(3)

(3)

Unamortized loss on bond refundings (6,518)

(6,518)

(2)

(2)

Add:

Unamortized bond premium 535 535 29 29 Net debt service requirements 239,664 230,021 469,705 2,244 901 3.145 Fiscal Year Ended Transportation Golf September 30 Principal Interest Total Principal Interest Total 2002 2003 2004 2005 2006 Thereafter Less:

Unamortized bond discount Unamortized loss on bond refundings Add:

Unamortized bond premium Net debt service requirements 117 123 130 66 18 13 7

2 135 136 137 68 436 40 476 436 40 476 499 421 493 489 503 6,080 414 388 367 342 319 1.685 913 809 860 831 822 7,765 8,485 3,515 12,000 (7)

(7)

(51)

(51) 61 61 8,488 3,515 12.003 (continued) 54 2-

NOTES.TO COMBINED FINANCIAL STATEMENTS

.. rnt,~mh*=r R(fl 2AM CITY OF AUSTIN, TEXAS S(Continued) 2002 2003 2004 2005 2006 Thereafter 798 856 743 450 155 123 86 48 19

.3 3,002 279 Less:

Unamortized bond discount Unamortized loss on bond refundings Add:

Unamortized bond premium Net debt service requirements 3,002 921 350.181 942 106,682 791 153,575 469 173,632

.158 180,973

'2,702,154 3,281 3,667,197 205,445

-192,780 176,626 162,445

- 152,111 1,781,095 2,670,502 555,626 299,462 330,201 336.077 333,084 4,483,249 6,337,699 S-(55,264)

(55,264)

(8,956)

(8,956) 37,193 37,193

!79 3,281 3,640,170

-2,670,502 6,310,672 55 14 - DEBT SERVICE REQUIREMENTS, continued Fiscal Year Ended Fleet Maintenance Support Services September 30 Principal Interest Total Principal Interest Total 2002 132 97 229 128 - -

55 183 2003 136 89 225 138 48 186 2004 130 81 211 152 42 194 2005 130 73 203 79 34 113 2006 84 67 151 45 30 75 Thereafter 1,338 431 1,769 558 141 699 1,950 838 2,788

-1,100 350 1.450 Less:

Unamortized bond discount (2)

(2)

(3)

(3)

Unamortized loss on bond refundings (59)

(59)

(59)

(59)

Add:

Unamortized bond premium 18 18 28 28 Net debt service requirements 1,907 838 2,745 1,066 350 1.416 Fiscal Year Total Ended Information Systems Debt Service Requirements September 30 Principal

- Interest Total Principal Interest Total

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continued) 15-INTERFUND RECEIVABLES AND PAYABLES Interfund receivables and payables at September 30, 2001, are as follows:

RECEIVABLES:

Special Revenue Funds Other Special Revenue Funds:

Receivable from Other Special Revenue Funds Capital Projects Funds Capital Projects Funds Prior to 1984:

Receivable from Capital Projects Funds Pnor to 1984 Capital Projects Funds 1984:

Receivable from Capital Projects Funds 1984 Capital Projects Funds 1985:

Receivable from Capital Projects Funds 1987 Capital Projects Funds 1992:

Receivable from Capital Projects Funds 1992 Capital Projects Funds 1998:

Receivable from Capital Project Funds 1998 Capital Projects Funds Other Funds:

Receivable fromn Capital Projects Funds Other Funds Receivable from Agency Funds Enterprise Funds Electnc:

Special Revenue Funds:

Receivable from Other Special Revenue Funds Water and Wastewater (Restricted):

Internal Service Funds:

Receivable from Information Systems Airport (Restricted):

Receivable from General Long-Term Debt Group Total Receivables Current Due From Other Funds Long-Term Advance To Other Funds 13,689,040 82,006 504,329 54,298 72,989 2,419,473 4,861.000 3,660 150,000 26,872 241,850 4,318,000

$ 21,863,667 4,559,850 (continued) 56

NOTES TO COMBINED FINANCIAL'STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS

"(Continued) 15 - INTERFUND RECEIVABLES AND PAYABLES, continued PAYABLES:

Special Revenue Funds Federal Grants:

Payable to Other Special Revenue Funds "State Grants:

Payable to Other Special Revenue Funds Other Special Revenue Grants:

Payable to Other Special Revenue Funds Other Special Revenue Funds Payable to Other Special Revenue Funds Payable to Electnc Fund Capital Projects Funds Capital Projects Funds Pnor to 1984:

Payable to Capital Projects Funds Prior to 1984 Capital Projects Funds 1984:

Payable to Capital Projects Funds 1984 Capital Projects Funds 1987:

Payable to Capital Projects Funds 1985 Capital Projects Funds 1992:

Payable to Capital Projects Funds 1992 Capital Projects Funds 1998:

Payable to Capital Projects Funds 1998 Capital Projects Funds Other Funds:

Payable to Capital Projects Funds Other Funds Internal Service Funds Information Systems:

Payable to Water and Wastewater Trust and Agency Funds Agency Funds:

Payable to Capital Projects Funds General Long-Term Debt Group Payable to Airport Total Payables 21,863,667 4,318,000 4,559,850

.-57 Current

-Due To Other Funds Long-Term Advance From Other Funds 8,018,701 849,390 94,722 4,726,227 150,000 82,006 504,329 54,298 72,989 2,419,473 4,861,000 26,872 241,850 3,660

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 __.

CITY OF AUSTIN, TEXAS (Continued) 16 - INTERFUND TRANSFERS a - Interfund Transfers Operating transfers between funds during the year were as follows:

Operating Transfers In Enterprise Funds:

Operating Transfers Out Electric Water and Wastewater Parks and Recreation Amount 67,283,000 18,541,446 458,516 86,282,962 Special Revenue Funds - Other:

Balcones Canyonlands Conservation Plan Barton Springs Conservation Environmental Remediation Federally Qualified Health Center Neighborhood Housing and Conservation PARD Cultural Projects Public Improvement District Sustainability Tourism and Promotion Voluntary Utility Assistance Debt Service Funds:

General Obligation Debt Service HUD Section 108 Loans Capital Projects Funds General Fund Enterprise Funds:

General Fund Enterprise Funds Enterprise Funds:

General Fund Enterprise Funds Special Revenue Funds:

Enterprise Funds General Fund Enterpnse Funds:

General Fund Special Revenue Funds:

General Fund Special Revenue Funds:

Capital Project Funds:

Special Revenue Funds:

General Fund Special Revenue Funds:

Capital Project Funds:

Expendable Trust Funds:

Drainage Water and Wastewater Solid Waste Drainage Hospital Electnc Water and Wastewater Airport Hotel-Motel Occupancy Tax Water and Wastewater Convention Center Water and Wastewater Solid Waste Drainage Transportation Hotel-Motel Occupancy Tax One Texas Center Downtown Art Museum Interest income fund Neighborhood Housing and Conservation Sustainability Cultural arts General government projects Fire-general Capital reserve Interest income fund Planting for the future 160,000 470,015 45,000 75,000 1,750,000 100,000 8,650,018 1,162,995 133,333 133,333 133,333 3,634,952 75,000 75,000 14,307,479 2,302,026 363,497 267,801 183,364 125,382 5,021,275 152,000 39,320,803 2,416,538 6,195,647 840,000 362,464 9,814,649 12,656,726 13,081,000 461,863 5,824,576 1,763,404 1,000,000 6,893,200 173.580 41,854.349 (continued) 58 General Fund

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continued) 16 - INTERFUND TRANSFERS, continued Operating Transfers In Enterprise Funds:

Solid Waste Services Convention Center Drainage Internal Service Funds:

Information Systems Trust and Agency Funds-,

Expendable Trusts:

'Housing Trust Social Equity Ooeratlna Transfers Out General Fund 1,

Special Revenue Funds:,

Enterpnse Funds:

Special Revenue Funds:

General Fund Special Re venue Funds:

Capital Project Funds:

Environmental Remediation Drainage.

Hotel-Motel Occupancy Tax Vehicle Rental Tax Suitainability Interest income fund Capital Project Funds:

General government projects Special Revenue Funds.

Sustainability Total Operating Transfers I Amount

-,1,084.354 868,000 46,893 22,488,324 10,710,151 298,504 154,000 925,800 "36,576.026 ;

1,000,000 1,000,000 215,848.789 b - Residual Equity Transfers Residual equity transfers between funds are listed below. Proprietary fund transfers are reported in the financial statements as residual equity transfers or as contributions, as appropriate under generally accepted accounting principles.

Residual Equity Transfers In Residual Equity Transfers Out Governmental funds General Fund Special Revenue Funds, Other Special Revenue Funds:

APD Incident Management Disproportionate Share Capital Projects Funds Conservation Land Balcones Canyonlands Conservation Plan Proprietary funds Enterprise Funds:

Water and Wastewater Hospital Trust and Agency funds Expendable Trust Funds:

Penta Development Fairway Ridge Brackenridge Imaging Town Lake Beautification 500,000 747,919 197,978 904,368 111,000 2.461.265 59 500,000 65,143 747,919 111,000 197,978 839,225 2.461,265 Operating Transfers Out

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continued) 17 - SEGMENT INFORMATION a - Enterprise Fund Activities The City maintains ten enterprise funds, which provide electric, water and wastewater, hospital, solid waste services, airport, convention center, drainage, transportation, golf, and parks and recreation activities. Segment information for the year ended September 30, 2001, is as follows (in thousands of dollars):

SWater &

Solid Waste Convention Other Total Electric Wastewater Hospital Services Airport Center Enterprise Enterprise Fund Fund Fund Fund Fund Fund Funds Funds Operating revenues Depreciation and amortization expense Operating income (loss)

Operating transfers in Operating transfers out Net income (loss)

Current assets Current liabilities Net working capital surplus Property, plant and equipment:

$ 806,311 219,914 9,755 36,958 68,528 85,828 52,240 2,520 1,801 15,292 262,516 65,720 5,010 991 13,978 1,999 (67,416)

(21,127)

(8,650)

(2,114)

(133) 103,425 1.696 (1,790) 1,310 16,169 234,444 34.913 35,460 6,797 9,655 74,535 19.119 61 4,074 8,620 159,909 15,794 35,399 2,723 1,035 11,072 55,066 1,207,604 2,668 1,944 162,293 (7,074) 2,741 343,882 33,198 1,379 36,576 (75)

(1,527)

(101,042) 24,198 6.431 151,439 18,514 9,074 348,857 982 3,480 110,871 17,532 5,594 237,986 Additions 244,226 129,523 9,078 14,202 82,121 9,495 488,645 Retirements (10,512)

(2,987)

(3,439)

(1,033)

(1,294)

(370)

(19,635)

Transfers from other funds 5

37 42 Net property, plant and equipment 1,935,789 1,657.341 41,040 43,218 608,609 199,448 64,419 4,549,864 Total assets 3,118,190 2,223,771 76,500 59,443 733,420 345,967 101,005 6,658,296 Bond, restricted, and other long-term liabilities Current capital contributions Total equity 1,931,549 1,437,220 25,066 412,415 259,747 12,642 4,078,639 904 I

1 906 1,112,106 767,432 76,439 30,303 312,384 85.238 84,884 2,468,786 60

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS

- (Continued) 17-SEGMENT INFORMATION, continued b

Proprietary Fund Contributed Capital The following table summarizes activity in contributed capital for the year ended September 30, 2001:

Balance September 30, 2000 Enterprise Funds:

Electric Water and Wastewater S-Hospital Solid Waste Services Airport -

I Convention Center Drainage 4

Transportation Golf Parks and Recreation Internal Service Funds:

Fleet Maintenance 4

Sup'port Services

-,4Information Systems Employee Benefits 4

Workers' Compensation S,_

Radio Communication 4

S.

Infrastructure Support Services Capital Projects Management' Total I

(To) From "Municipality

$ - 65,065,927 350,855,981 12,754,170 1,372,233 152,302,895 21,606,204 31,010,335 331,206 848,680 1,069,976 27,468,252

.941,164 5,955,380 9,244,036 2,443,283 56,255 343,005

-28,300 683.697,282 904,368 1,366

,3,731,702 3,253,421 7,890,857 "Depreciation

" 'Taken (3.3 (14,1 (2.4 Balance September 30, 2001 35,183) 61,730,744 75,147) 336,680,834 13,658,538 1,372,233 68,017) 149.836,244 (70,216) 21,535,988

.31.010,335,44 331,206 (6,885) 841,795

.1,069,976 31,199,954 941,164 9,208,801 9,244,036 2,443,283 S-

.- 56,255.

- 343,005 28,300 055,448) 671,532,691

18-JOINT OPERATIONS The City has entered into several participating agreements on joint projects., As required by generally accepted accounting principles, such joint operations have been evaluated to determine if they fall within the definition of the reporting entity. The following joint operations meet the criteria of an undivided interest as defined in GASB Statement 14 and, accordingly, the City's share of assets, liabilities, and expenses Is included in the City's financial statements.

aa-Fayette Power Project The Fayette Power Project (the "Project", Units I and II) is jointly owned by the City and the Lower Colorado River Authority (LCRA, Project Manager) - each participant has an undivided interest in the Project. The Project is a joint operation of two coal-fired electric power generation units with anetcapacity of 1,140 megawatts.

Each participant's actual equity in the Project may vary from 50% depending on the percentage of killowatt hours produced by the Project and used by each.

The Project is governed by a' management committee whose four members &re administratively appointed, two each, by the participants.

As managing parner, LCRA is responsible for the operation of the Project and appoints the Project's management. However, the City has the abihity to influence lignificantly the operatiohn of the Project through approval of major contracts and new major expenditures' by its'api5ointees to the management committee. Each participant issued Its own debt to finance its share of construction costs. The City's portion is financed through revenue bonds to be repaid by the Electric Fund. In addition, each participant has the obligation to finance its portion of any deficits that may occur.

-61 4

4 4

(20,0

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 18 - JOINT OPERATIONS, continued The following is a summary of financial information taken from the Project's audited financial statements, dated June 30, 2001, and 2000, the Project's fiscal year end (in thousands of dollars). These statements include Unit III, which is 100%

owned by LCRA. These statements were not examined by the City's auditors.

June 30, 2001 June 30, 2000 Total COA LCRA Total COA LCRA Assets 58,227 22,105 36,122 62,897 26,536 36.361 Liabilities 8,005 2,930 5,075 14.412 5,275 9.137 Equity 50,222 19,175 31,047 48,485 21,261 27,224 Revenues 2,526 549 1,977 1,538 361 1,177 Expenses 154,339 53.905 100,434 150,069 52,712 97.357 Net expenses incurred 151,813 53,356 98,457 148.531 52,351 96,180 Financial reports that include financial statements and supplementary information for the Fayette Power Project are publcly available at the LCRA, 3700 Lake Austin Blvd., Austin, TX 78703, (512) 473-3200.

b - South Texas Project The South Texas Project (STP) was formed for the' purpose of licensing, constructing and operating two 1,250 megawatt nuclear generating units. The City was admittedto the STP in December 1973, with a 16% ownership in generating units and common facilities. The City is a tenant-in-common with Reliant Energy, Inc. (formerly Houston Lighting and Power Company or HL&P), City Public Service of San Antonio (CPS), and Central Power and Light Company (CP&L).

On October 1, 1997 the STP Nuclear Operating Company (OPCO) was formed by the owners of STP and replaced HL&P as the project manager. OPCO is a separate entity formed to manage STP. Each participant appoints one member to the board of directors of OPCO. There is also an owner's committee, and each participant appoints one member to the owner's committee. A member of the owner's committee may serve-on the board of directors in the absence of a board member.

OPCO, serving as project manager, is responsible for the operation and maintenance of the project as well as capital improvements. Each participant is responsible for its debt related to STP. The City's portion is financed through revenue bonds or commercial paper, which are repaid by the Electric Fund (see Note 12). In addition, each participant has the obligation to finance any deficits that may oc6ur.

The City's portion of Units 1 and 2 of the South Texas Project is classified as plant in service. Nuclear fuel includes fuel in the reactor as well as nuclear fuel in process.'

The following is a summary of financial information taken from the South Texas Project's audited financial statements dated December 31, 2000 (in thousands of dollars). These statements were not examined by the City's auditors.

Operations Spent fuel Total 2000 funding Reliant CPS CP&L Austin Total 91,029 82.754 74,519 47,288 295,590 5.325 4,787 4.213 2,767 17,092 96,354 87.541 78.732 50,055 312,682 Financial reports that include financial'statenients and supplementary information for the STP are publicly available at the STP Nuclear Operating Company, P.O. Box 289, Wadsworth, TX 77483, (361) 972-7067.

62

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS

"(Continued) 18 - JOINT OPERATIONS, continued c - South Texas Project Decommissioning The South Texas Project (STP) is subject to regulation by the Nu~lear Regulatory Commission (NRC). The NRC requires that each holder of a nuclear plant operating license submit information to the NRC indicating the minimum amount of funds that will be required to decommission 'the plant while demonstrating reasonable assurance that sufficient funds -are being accumulated to provide the minimum amount at the time the plant Is decommissioned. This minimum amount must be*

adjukted annually in accordance with an adjustment factor as required by the NRC. At September 30, 2001 and 2000, the City had funded its share of the eitiniated decommissioning liability as follows:

I I

Estimated cost to decommission STP Restricted decommissioning fund assets 2001

$210,784,554 72,591,362 2000

$200,423,996

"'63,515,224

• x The City of Austin and other STP participants have provided the'required information to theiNRC; and the City of Austin has established an external irrevocable trust for decommissioning and has been collecting through its rates since 1989 sufficient amounts to provide for its share of the estimated decommissioning costs. For fiscal years 2001 and 2000, the City collected

$4,958,221 in each year for decommissioning expenses.

d Sandhill Power Project The City 'entere'd-into a 'Participation Agreement with Enron Sandhill Limited Partnership ("Enron 'Sandhill") for the construction and operation of the Sandhill Energy Center in Travis County. Operational since June 2001, the plant contains four gas-turbine units and has a total output capacity of 180 megawatts. Enron Sandhill wias r-esponsible for constructing the plant, while Austin Energy is responsible for the vast majority of the construction costs and for occupying and running the plant. Enron Sandhill's interest is limited to an 8.6% ownership interest in the plant (though Austin Energy owns 100% of the land on which the plant is sited) and a right to the first 100 megawatts of output until November 3, 2003. At that time Enron's interest in the plant will terminate and Austin Energy shall acquire full ownership and control.- Currently,'the Sandhill Energy Center is governed by a management committee composed of a representative of each, with Austin Energy's representative serving as the Chair.

e - Municipal Utility Districts The City has certain contractual commitments with several municipal utility districts (MUDs) for the construction of additions and Improvements to the City's water and wastewater system that serve the MUDs and surrounding areas. These'additions and Improvements are funded by'the issuance of City contract revenue bonds, whose principal and interest'are payable primarily from the net revenues of the Water and Wastewater Fund.

The City reports the bond 'proceeds as "investment In municipal utility districts" on the balance sheet of the Water and Wastewater Fund. As facilities funded by the contract revenue bonds are completed, the City's Investment in municipal utility districts is reduced and plant in service is increased.

f - Brushy Creek During fiscal year 2001, the City entered into a contract with the Lower Colorado River Authority and the Brazos River Authority for the Brushy Creek Regional Wastewater System. The City sold its assets in the system and is now a customer rather than an owner In the system. The Lower Colorado River Authority constructs the assets of the system and the Brazos River Authority operates the system.

63

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 18 - JOINT OPERATIONS, continued g - Rivercrest Water Supply Corporation Upon annexation, in December 1997, of Davenport Ranch Municipal Utility District ("Davenport MUD"), the City assumed a cost sharing agreement with Davenport MUD, Davenport Umited, Rivercrest Water Supply Corporation and Loop 360 Water Supply Corporation. The agreement allocates the costs, based on capacity allocations, of operating a private water treatment facility servicing the Davenport MUD and the other participants' service areas. ST Environmental is under contract to operate the water treatment facility. The City may amend this arrangement in the future to provide for facility improvements that will allow the customers to be served by the City's system. The City incurred expenses of $255,619 during the fiscal year.

19 - LITIGATION a - Water and Wastewater Litigation The City is involved in a number of lawsuits involving the operation of its water and wastewater system; some small lawsuits involve various property claims. The City believes these suits will not have a material effect on these financial statements.

b - Other Litigation A number of claims against the City are pending with respect to various matters arising in the normal course of the City's operations. Legal counsel and City management are of the opinion that the settlement of these claims and pending litigation will not have a material effect on the City's financial statements. The City has accrued liabilities in the Liability Reserve Fund for claims payable at September 30, 2001. These liabilities include amounts for lawsuits settled subsequent to year end.

20 - COMMITMENTS AND CONTINGENCIES a -- Certificates of Participation The City has entered into several capital lease arrangements through the issuance of Certificates of Participation as follows:

$23,060,000 Certificates of Participation, City of Austin, Texas Electric Utility Office Project, Series 1987;

$14,000,000 Certificates of Participation, City of Austin. Texas Water and Wastewater Utility Office Project, Senes 1987; The certificates represent proportionate interests in lease payments to be made by the City to a third-party lessor. The City has btile to the office projects, pursuant to general warranty deeds; however, the trustee maintains a vendor's lien and superior title to the properties until all sums due are paid in full.

The City's obligations under the lease agreements are subject to and dependent upon annual appropriations by the City Council and do not obligate the City to levy or pledge any form of taxation. Thus the certificates are treated as capital lease obligations rather than long-term bonds and are recorded as a liability in the funds.

64

NOTES TO COMBINED FINANCIAL STATEMENTS September 30, 2001 CITY OF AUSTIN, TEXAS (Continued) 20 - COMMITMENTS AND CONTINGENCIES, continued The following table presents information regarding these certificates:

Description Date issued Amount issued Interest rates Interest payable on Maturity dates Electric Fund Office Project (1)

February 1987

$23,060,000 4.00% - 7.00%

March 15 and September 15 September 15 1988-2007 Present value of lease payrmenis

$10,085,000

-/

,Reserve'Fund (2)

$ 2,000,000 (1) Subiect t6 mandatory redemption upon the occurrence of certain events.

(2) Held by trustee, to be used to make final payments.

Water and Wastewater Fund Office Project (1)

August 1987

$14,000,000

-5.25%, 8.00%

May 15 and November 15 November 15

, 1989 -2007 S$7,456,000

$1,250,000 b - Federal and State Financial Assistance Programs The City participates in a number of Federally assisted and State grant programs, with most funding from the Housing and Urban Development (HUD) Department, Health and Human Services (HHS) Department, and Department of Transportation.

The City's programs are subject to program compliance audits by the granting agencies. Management believes that no material liability~will arise from any such audits.,

c - Arbitrage Rebate Payable The Citys finanrcial advisor-has determined that the City has eamed interest revenue on unused bond proceeds in excess of amounts allowed by applicable Federal regulations, which will be rebated to the federal govemment. The estimated amounts payable at September 30, 2001 are $844,124 for the enterprise funds and $2,804,045 for the capital projects funds. The long-term payable related to the capital projects funds, in the amount of $2,601,957, has been recorded in the General Long Term Debt Group.

d - Capital Improvement Plan As required by the City Charter, the City has a Five Year Capital Improvement Plan that is an anticipated spending plan for projects in the upcoming year (a Capital Budget) as well as for future years. The City's 2002 Capital Budget includes new appropriations of $430,817,449 for the City's enterprise funds and $106,859,820 for general government projects and appropriation reductions of $37,351,005 for the enterprise funds and $6,263,334 for general government projects. The City has substantial contractual commitments relating to its capital improvement plan.

Operating lease with Daughters of CharitySHealth Services of Austin Effective October 1, 1995, the City entered into a long-term lease arrangement with the Daughters of Charity Health Services of Austin ("Seton'). -Under the terms of the lease, Seton will operate City-owned Brackenridge Hospital and will provide all necessary medical services for-all residents of Austin regardless of their ability to pay. rThe City will fund these services through payments to Seton for three programs. ;Under the Charity Care Program, the City will reimburse Seton up to a maximum of $5.6 million annually for providing care to the medicallyindigent; provided, however, that Seton must first satisfy its requirement under State law to provide charity care in the amount of 4%of net revenues. Under the Medical Assistance Program, the City will pay Seton a maximum of approximately $7.5 million beginning February 2001 (adjusted annually for the next 4 years) for providing services to patients enrolled In the City's Medical Assistance Program. For fiscal year 2001, expenditures were $7.0 million. Under the Physician Services Program, the City paid Seton approximately $5.4 million during fiscal year 2001, for providing physician services to patients in the first two programs. This amount will beadjusted annually for the next four years.

65

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 20 - COMMITMENTS AND CONTINGENCIES, continued In June 2001, Seton formally notified the City that it would be unable to perform or permit others to perform certain reproductive services at Brackenridge Hospital. The notification was due to revisions in the Ethical and Religious Directives for Catholic Health Care Services to which Seton adheres. The City is in discussion with Seton in order to reach a mutually agreeable resolution.

f - Landfill Closure and Postclosure Liability State and federal regulations require the City to place a final cover on the City of Austin landfill site (located on FM812) when it stops accepting waste and to perform certain maintenance and monitoring functions at the site for thirty years after closure.

Although closure and postclosure care costs will be paid only near or after the date that the landfill stops accepting waste, the City reports in the Solid Waste Services Fund a portion of these closure and postclosure care costs as an operating expense in each period, based on landfill capacity used as of each balance sheet date. The $6,904,024 reported as accrued landfill closure and postclosure costs at September 30, 2001, represents the cumulative amount reported to date based on the use of 77.9% of the estimated capacity of the landfill. The Solid Waste Services Fund will recognize the remaining estimated cost of closure and postclosure care of $1,958,652 as the remaining estimated capacity is filled over the next ten years. The total estimated costs of $8,862,676 include costs of closure in 2010 of $2,298,015 and postclosure costs over the subsequent thirty years of $6,564,661. These amounts are based on what it would cost to perform all closure and postclosure care in 2001. Actual costs may be higher dud to inflation, changes in technology or changes in regulations.

State and federal laws to demonstrate financial assurance for closure, postclosure, and/or corrective action became effective in April 1997. The City complies wth the financial and public notice components of the local government financial test and government-guarantee of the test.

g - Risk-Related Contingencies The City uses internal service funds to account for risks related to health benefits, third-party liability, and workers' compensation. The funds are as follows:

Fund name Description Employee Benefits Approximately 13% of City employees use one of two HMOs; approximately 87% use the City's program, which is self-insured. In addition, retirees may choose from two HMOs and a PPO. Premiums are charged' to other City funds through a charge per employee per pay period.

Liability Reserve Self-insured. Includes losses and claims related to liability for bodily injury, property damage, professional liability, and certain employment liability. Excludes losses and claims related to health benefits or workers' compensation. Premiums are charged to other City funds each year based on historical costs.

Workers' Compensation Self-insured. Premiums are charged to oiler City funds each year based on historical costs.

The City purchases stop loss insurance for the City's self-funded Medical Plan. This stop loss insurance covers individual claims that exceed $150,000 per calendar year, up to a maximum of $1 million. During fiscal year 2001, two claims exceeded the stop loss limit of $150,000; four claims exceeded the stop loss limit in fiscal year 2000; and six claims exceeded the stop loss limit in fiscal year 1999. City coverage is limited to $1 million in lifetime benefits. The City does not purchase stop loss insurance for workers' compensation claims.

The City purchases commercial lnsurance' for coverage for property loss or damage, commercial crime, fidelity bond, hnd airport operations. The City also purchases a broad range of insurance' coverage through the Rolling Owner Controlled Insurance Program (ROCIP).

The program provides auto and commercial general liability coverage for the-City and for contractors working at selected capital improvement sites; it also provides workers' 6om6pensation, employers' liability, and excess liability for contractors at these sites. The City purchases excess liability coverage for the Electric Fund and the Airport Fund.' The City also purchases medical malpractice insurance coverage for physicians in the City's Health and Humarn Services Department and Primaryý Care Department clinics. ' None of the policies had claims settlements in excess of insurance coverage. The City does not participate in a risk pool. There are no significant reductions in insurance coverage in fiscal year 2001.

66 I-

NOTES TO COMBINED FINANCiAL STATEMENTS A

f -

CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 20 - COMMITMENTS AND CONTINGENCIES, continued Liabilities are reported when it is probable that a loss has been incurred at the date of the financial statements and the amount of the loss' cn be reasonably estimated.' Liabilities include an amount for claims that have been incurred but not reported (IBNRs)., Claim liabilities for the Employee Benefits Fund are calculated considering recent claim settlement trends; liabilities for the Liability Reserve Fund and Workers' Compensation Fund are calculated based on outstanding claims. The amount to be ýaid out ultimatily may be more or less than the amount accrued at September 30, 2001. The possible range of losilis $23.5 - $3k6.5 million. The City contributes amounts to an internal service fund based on an estimate of the cost of claims expected to be incurred each year.

Changes in the balances of claims liability are as follows (in thousands of dollars):

Employee Liability

'Workers' Benefits Reserve Compensation 2001 2000 2001 2000 2001 2000 Liability balances, beginning of year 3,737 3,021 12,042 12,497 6,347' 4,154 '

-Claims and changes In estimates 4,015 4,024 3,897 2,705 3,472-5,483 Claim payments (3,282) -

(3,308)

(3,239)

(3.160)

(3,472)

(3,290)

Liability balances, end of year 4,470 --

3,737 12,700 12,042 6,347 6,347 The Liability Reserve Fund claims liability balance at fiscal year end includes liabilities of $5.8 million discounted at 5.28% In 2001 and $6.2 million discounted at 5.74% in*2000.

h - Environmental Remediation Contingencies The Electric Fund may incur potential costs related to environmental remediation of certain sites including the Seaholm Power Plant, and the statements include a liability of $2 million at Septemnber 30, 2001. This amount includes the cost of penalties associated with an Environmental Protection Agency (EPA) PCB inspection and estimated remaining costs for the remediation of the contaminated sites. The Electric Fund anticipates payment of these costs In 2002.

The EPA previously issued an Administrative Order to the Water and Wastewater Utility. The Utility must conduct studies of its wastewater collection system, eliminate overflows by December 2007 and make necessary improvements requiring capital investment for the repair and/or'rehabilitation of the collection system infrastructure. Wher the studies are complete the utility will be able to estimate the cost of the improvements.

Currently, the Utility is complying with all requirements of the Administrative Order.

The Airport Fund may also incur potential costs related to environmental remediation of certain sites, and has recorded In these financial statements an estimated liability of $3 million.

I - Downtown Development Projects The Austin Convention Center expansion is under way. The $110 million expansion will double the amount of space currently available. The expansion is scheduled to be completed in May 2002. In March 2001, the City Council approved payment of

$15 million to Austin Convention Enterprises, Inc. for the City's share in the construction of a new Convention Center Headquarter Hotel; the payment is recorded as a deferred asset in the Convention Center Fund. The hotel will be financed by debt issued by Austin Convention Enterprises, Inc. The debt does not constitute a pledge of faith and credit of the City and accordingly has not been reported in the accompanying financial statements. The hotel is scheduled to open for business in January 2004.

The Lester E. Palmer Events Center and Parking Garage are also nearing completion. These facilities will replace the City Coliseum and Palmer Auditorium. The Lester E. Palmer Events Center and Parking Garage were approved through a bond proposition by Austin residents in 1998. The total project cost is approximately $48.3 million, which is funded by an increase in the vehicle rental tax of 5%. The parking garage is scheduled to open in November 2001; the events center is scheduled to open in June 2002.

-67

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 20 - COMMITMENTS AND CONTINGENCIES, continued The 1998 election also authorized the City to lease the existing Palmer Auditorium and adjacent parkland for up to fifty years.

Arts Center Stage, the lessee, will renovate the auditorium using privately-raised funds. The renovated auditorium will be known as the Long Center for the Performing Arts. The auditorium reverts to the City at the end of the fifty-year lease.

In August 2001, Computer Sciences Corporation (CSC) employees moved into the first of two new buildings. Employees are scheduled to move into the second building in November. CSC has not begun construction of a planned third building. See Footnote 22 for an update subsequent to September 30.

In December 2000, the City Council approved a resolution for a $25 million incentive package for Vignette Corp. to relocate in downtown Austin. Vignette announced in May 2001 that it was canceling the relocation plans due to the economic slowdown.

Also, Intel Corporation has halted construction of a 10-story downtown center due to the economic slowdown. Any decision on the project has been postponed indefinitely. Intel was to have received up to $9 million in incentives for development in the downtown area.

j - Other Commitments and Contingencies The City is committed under various leases for building and office space, tracts of land and rights of way, and various equipment These leases are considered for accounting purposes to be operating leases. Lease expense for the year ended September 30, 2001, amounted to $17,617,658.

The City expects these leases to be replaced, in the ordinary course of business with similar leases. Future minimum lease payments for these leases should be approximately the same amount.

The City has entered into c~rtain lease agreements, including the certificates of participation, as lessee for financing the purchase of equipment used in the Electric Fund and Water and Wastewater Fund. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception.

The following summarizes utility assets recorded at September 30, 2001, under capital lease obligations:

Water &

Electric Wastewater Total Assets Building Accumulated depreciation Net assets

$ 21,604,300 12,750,000 34.354,300 (7,463,804)

(3,434,330)

(10,898.134)

$ 14,140,496 9,315,670 23,456,166 68

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 20 - COMMITMENTS AND CONTINGENCIES, continued The following Is an analysis of the future minimum lease payments under these capital leases and Certificates of Participation and the present value of the net minimum lease payments, as of September 30, 2001:

Fiscal Year Ended Water and Septemhber 30 Electric Wastewater Total 2002 2,210.065 1.406.194 3,616,259 2003 2,207,430 1,387,931 3,595,361 2004 2.206,730 1,389,216 3,595,946 2005 2,203,680 1,384,350 3,588,030 2006 2,202,930 1,373,437 3,576,367 Later years Total minimum lease payments Less:

Amount representing interest Present value of net minimum lease payments Current portion Long-term portion 4.301.059 2.758.000 7.059.059 15,331,894 9,699,128 25,031,022 3,858,760 2,249,128 6,107,888 11,473,134 7,450,000 18,923,134 1,436,614 850,000 2,286,614 10,036,520 6,600,000 16,636,520 The City guarantees certain energy improvement loans made by a bank. The maximum contingent liability of the RMD Loan Fund, a special revenue fund, is $3.7 million, which City management does not anticipate having to fulfill.'

The City has entered into an agreement with the Federal Aviation Administration'iegarding the development of new facilities exclusively for the use of the State Aircraft Pooling Board of Austin-Bergstrom International Airport. The construction of these facilities was paid for from the Aviation Fund, which receives Federal airport grant assistance.' The Aviation Fund was pa~rtially'reimbursed for the $4.8 million in constructioni costs with $1.4 million that was received by the City from the Austin Museum of Art, Inc. for land conveyed to the City from the State of Texas. Additionally, land at the City's former airport site (Mueller) received Federal grant assistance. Repayment of these amounts will be made from the City to the Aviation Fund over a period of 5-7 years. The Aviation Fund has recorded a corresponding interfund receivable in'the amount'of $4.3 million.

To comply with Federal Aviation Administration (FAA) requirements, the City stopped sending household garbage,to the City's landfill site near Austin-Bergstrom International Airport. 'The landfill site continues to'ac6ept nonbird attracting waste, and the FAA has agreed to this approach. With the closing ofthe City landfill for household garbage, the City has entered into long-term contracts for hotdsehold waste disposal.

21 - OTHER POST-EMPLOYMENT BENEFITS In addition to making contributions to the three pension systems, the City povided certain other 'post-er' oyment benefits' to its retirees. Other post-employment benefits include access to medical and dental insurance f6r the retiree and the retiree's family and $1,000 of life insurance on the retiree only.

All retirees who are eligible to receive pension benefits under any of the City's three pension systems are eligible for other post-employment benefits. Retirees may also enroll eligible deoendents under the medical and dental plan(s) in which they participate. Eligible dependents of the retiree Include a legally married spouse, Unmarried children tinder age 19 (under age 24 if an eligible student) who are dependent upor the retiree for support including natural children, stepchildren, legally adopted children', children for whom the-retiree has obtained court-ordered guarcianshiplconservatorship, qualified children placed pending adoption, and grandchildren who qualify as a depehdent on the retiree's or retiree's spouse's federal income tax return, and eligible disabled children. A surviving spouse of a deceased retiree may continue medical coverage until the date the surviving spouse remarries. A surviving spouse of a deceased retiree may continue dental coverage for 36 months by paying the entire premium plus a two-percent administrative fee. Other surviving dependents of a deceased retiree may continue medical and dental coverage for 36 months by paying the entire premium plus a two-percent administrative fee.

69

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS September 30, 2001 (Continued) 21 - OTHER POST-EMPLOYMENT BENEFITS, continued The City is under no obligation, statutory or otherwise, to offer other post-employment benefits or to pay any portion of the cost of other post-employment benefits to any retirees. Allocation of City funds to pay other'post-employment benefits or to make other post-employment benefits available is determined on an annual basis by the City Council as part of the budget process.

The City pays a portion of the retiree's medical insurance premium and a portion of the retiree's dependents' medical insurance premium. The portion paid by the City varies according to age, coverage selection, and years of service. The percentage of the medical insurance premium paid by the City ranges as follows:

Years of Service Retiree only Dependent only Less than 5 years 6%-18%

4%-11%

5 to 10 years 10%-26%

5%-17%

10 to 15 years 16%-44%

9%-28%

15 to 20 years 23%-62%

14%-39%

Greater than 20 years 32% - 88%

18% - 56%

The City pays 100% of the retiree's life insurance premium. Group dental coverage is available to retirees and their eligible dependents. The retiree pays the full cost of the dental premium.

Other post-employment benefits are expensed and funded on a pay-as-you-go basis. The City recognizes the cost of providing these benefits as payroll expense/expenditure in an operating fund with corresponding revenue in the Employee Benefits Fund. Medical and dental premiums and claims and life insurance premiums are reported in the Employee Benefits Fund. The cost of providing these benefits for 2,090 retirees and 9,713 active employees in 2001 and 2,050 retirees and 9,320 active employees in 2000 is not separable and cannot be reasonably estimated. Total payments to the Employee Benefits Fund for retirees and active employees were $39,444,283 in 2001 and $31,479,028 in 2000.

As more fully descnbed in Note 18, the City is a participant in the South Texas Project Nuclear Operating Company (OPCO) and as such Is liable for certain post-employment benefits for OPCO employees. At December 31, 2000, the City's portion of this obligation, $5,899,126, is not reflected in the financial statements of the Electric Fund.

22 - SUBSEQUENT EVENTS a - General Obligation Bonds Issuance In October 2001, the City, issued Public Improvements Bonds, Series 2001, in the amount of $79,650,000. Of the proceeds from the issue, $6,310,000 will be used for land acquisition and libraries. $1,000,000 will be used for asbestos abatement,

$35,555,000 will be used for street improvements, $8,920,000 will be used for park and recreation facilities, $4,565,000 will be used for emergency centers, and $2,300,000 will be used for the Carver Museum expansion, $15,000,000 will be used for ROW acquisition and utility relocation, and $6,000,000 will be used for police forensics. These bonds will be amortized serially on September 1 of each year from 2004 to 2021. Certain of these bonds are callable beginning September 1, 2012.

Interest is payable on March 1 and September 1 of each year, commencing March 1, 2002. Total interest requirements for these bonds, at rates rangin'g from 4% to 5.25%, are $53,100,504.

b - Public Property Finance Contractual Obligations Issuance In October 2001, the City issued Certificates of Obligation, Series 2001, in the amount of $2,650,000. Of the proceeds from the issue, $1,385,000 will be used for police helicopter and $1,265,000 will be used for capital equipment. These certificates of obligation will be amortized serially May 1 of each year from 2002 to 2008. Interest is payable on May I and November 1 of each year, commencing May_1, 2002. The contractual obligations are not subject to optional redemption prior to maturity.

Total interest requirements for these obligations, at rates ranging from 3% to 3.88%, are $391,720.

70

NOTEýS TO COMBINED FINANCIAL STATEMENTS CITY-OF AUSTIN, TEXAS September 30, 2001 (Continued) 22 - SUBSEQUENT EVENTS, continued c -.:Certificates of Obligation Issuance In October 2001, the City issued Certificates of Obligation, Series 2001, in the amount of $65,335,000. The proceeds from the issue 'will'be used as follows: developer reimbursements "($500,000); right of way acquisition'and utility relocation

($29,500,000), convention center ($10,000,000), golf course improvements ($620,000), north service center ($3,545,000),

City Hall ($19,150,000), and landfill capital requirements ($2,020,000). These certificates of obligation will'beamortized serially September 1 of each year from 2002 to 2021. Certain of these obligations are callable beginning September 1, 2012.

Interest is payable'on March 1 and September 1 of each year: commencing March 1 2002. Total Interest requirements for these obligations, at rates ranging from 4% to 5.25%, are $31,414,665.

d - Water and Wastewater System Revenue Bond Refunding Issue In November 2001, the City issued $95,380,000 of Water and Wastewater System Revenue Refunding B6nds Series 2001C.'

Proceeds from the bonds were used to refund $96,660,000 of the par amount of the bonds. The refunding resulted in future interest requirements to service the debt of $25,419,181.

An 'economic gain of $7,971,757 was -rec6gniied on this transaction. The :change in net cash flows that resulted was $8,066,955. An accounting loss of $3,123,904, which *,ill be deferred an d 'amortized in accordance with Statement of Financial Accounting Standards No.'71., ýwas :re**ognized on the refunding. The following bonds were refunded in this transaction (in thousands of dollars):

Series Amount 1986 Revenue 10,065 1990A Refunding 4,920 1990B Refunding 900 1990 Sub Lien 3,740 1991A Refunding 29,670 1991 Circle C MUD No. 3 14,200 1991 Southland Oaks MUD 18,155 1991 Village at Western Oaks MUD 15,010 96,660 e - Grant Liability In October 2001, the Housing and Urban Development (HUD) Department directed the City to repay $1.25 million used to purchase land in a prior year. The City contracted with a subrecipient to develop the land with a housing project known as Vision Village. The subrecipient is under investigation by the City and FBI; in November 2001, the investigation was turned over to the county district attorney's office. HUD has agreed to allow the City to repay the amount in installments during fiscal years 2002 and 2003, and the City has reported this amount In the fiscal year 2001 financial statements.

f-Electric Retail Competition Municipally owned utilities such as the City's electric utility system have the option of offering retail competition after January

1. 2002. The City Council has directed that the electric utility will not open its service area for retail competition ("opt in") at this time.

g - Enron Bankruptcy The electric utility (Austin Energy) and Enron Corporation have entered into a joint operation agreement (the Sandhill Power Project). Although Enron Sandhill is not In bankruptcy, its guarantor, Enron North America Corporation is currently under Chapter 11 protection. Prior to the bankruptcy filing, Austin Energy issued a notice of default to Enron Sandhill and Enron North America stating that Enron and Partnership were in anticipatory breach of their obligations under the Participation Agreement because of past due invoices. The letter also stated that Austin Energy would decline any requests to schedule delivery of energy from Sandhill Energy Center until payment of delinquent invoices have been received and authorized written assurances are given that future invoices will be paid in a timely manner. Austin Energy suspended all bilateral transactions with Enron in early November 2001 and no additional energy transactions are contemplated with Enron. Austin Energy does not anticipate that the Enron bankruptcy proceedings, in which Austin Energy is listed as an unsecured creditor, will have a material adverse effect on the operation of the Sandhill Energy Center.

71

NOTES TO COMBINED FINANCIAL STATEMENTS CITY OF AUSTIN, TEXAS.

September 30, 2001 (Continued)'

22 -- SUBSEQUENT EVENTS, continued Enron has not billed Austin Energy for all remaining construction costs of the Sandhill Energy Center, which are estimated at

$1 million. Austin Energy considers these costs probable and, in accordance with generally accepted adcountin g principles, has accrued this amount. Other potential costs associated with Enron include recent payments to Austin Energy by Enron, which may be subject to preference challenge in bankruptcy court. Estimates of the costs range from $0 to $1.6 million.

h -Conduit Debt In December 2001, the City issued $11.5 million of housing revenue bonds for Austin Housing Finance Corporation. These bonds are secured by the property financed and are payable solely from payments received on the underlying mortgage loans. The bonds do not constitute a debt or pledge of the faith and credit of the City and accordingly will not be reported in future financial statements.

I - Computer Sciences Corporation In January 2002, the City Council voted to buy back from Computer Sciences Corporation (CSC) the right to develop a city owned block that the City agreed in 1999 to lease'to CSC. The City will pay $4 million to CSC in order to buy back the development rights. In addition to the $4 million payment, CSC will keep a $4 million deposit it originally paid into escrow,'

which was to be paid to the City at the inception of construction on this block. The City will avoid paying $2.6 million in incentives and will keep previously promised parking garage space beneath City Hall with an estimated value of $4 million.

CSC has completed construction on two other city-owned blocks that constituted the original agreement.

72 I

GENERAL FUND The General Fund is the general operating fund of the City. It is used to account for all financial resources except for those required to be accounted for in another fund.

GENERAL FUND BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 2001 "

ASSETS Cash Pooled investments and cash Property taxes receivable Less allowance for uncollectble taxes Net taxes receivable Accounts and other taxes receivable

'Less aallowance for doubtful accounts Net accounts receivable Inventories, at cost Prepaid items and other assets Total assets LIABILITES AND FUND BALANCES Liablitbes:

Accounts payable Accrued payroll Accrued compensated absences Due to other funds Deferred revenue Performance, escrow and other deposits Total liabIrtes Fund balances, Reserved:

-Encumbrances Inventories and prepaid items Emergencies

'Contingencies Unreserved

- Designated for future use Undesignated Total fund balances Tot;l liabilities and fund balances I -I 87,388 35,120,932 5,434,951

"(989,677) 4,445,274 66,464,570 (38,615,300) 27,849,270 1,522,969 273,011 69,298,844 5,586,536 5,798,262 2,774,177 4,458,160 2,601,118 21,218,253 6,460,867 1,795,980 15,000,000 366,953 539,613 23,917,178 48,080,591

$ 69,298,844 CITY OF AUSTIN, TEXAS Exhibit B-1 2000--

124,742 28,270,387 5,386,313 (969,536) 4,416,777 66,942,596 (36,928,045) 30,014,551 1,540,774 283,477 64.650.708 6,145,105 4,694,875 2,804,177 13,229 4,353,051 2,131,200 20.141.637 9,442,246 1,824,251 17,658,310 615,422

'14,968,842 44,509,071 64,650,708 73 2001 "

GENERAL FUND "

SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL-BUDGET BASIS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CITY OF AUSTIN,'TEXAS Exhibit B-2 REVENUES Taxes Franchise fees Fines, forfeitures and penalties Licenses, permits and inspections Charges for services/goods Interest and other Nondepartmental revenues Total revenues EXPENDITURES Administration Urban growth management Public safety Public services and utilities Public health:

Physician stipend/chanty care Medical Assistance Program-hospital contracted services/patient services Other public health Public recreation and culture Social services management Nondepartmental expenditures (3)

Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES)

Operating transfers in Operating transfers out Total other financing sources (uses)

Excess (deficiency) of revenues and other sources over expenditures and other uses Fund balances at beginning of year Residual equity transfers in (out)

Special revenue funds:

APD Incident Management Fund balances at end of year 2001 Actual Adjustments Budget Variance Favorable 2000 Actual Budget Actual (1) (2)

Basis Budget (Unfavorable)

Basis

$ 251,749,818 251,749,818 259,543,305 (7,793,487) 240,663,684 31,452,706 31,452,708 28,002,200 3,450,506 23,699,065 16,999,766 16,999,766 16,684,955 314,811 16,039,732 17,630,897 17,630,897 16,953,748 677.149 18.173,885 14,984,531 (1,259,810) 13,724.721 11,262,833 2,461,888 11,757,818 10,584,063 10,584,063 8,957,902 1,626.161 9,410,372 8,794,817 343,401,781 (1,259,810) 342,141,971 341,404,943 737,028 328,539,373 9,425,506 (3,445) 9,422,061 9,757,764 335,703 9,217,085 11,569,463 42,210 11,611,673 13,028,116 1,416,443 10,215,532 210,280,836 2.413,882 212,694,718 217,975,633 5,280,915 190,347,117 9,519,936 162,049 9,681.985 10,111,779 429,794 5,917,338 10,495,146 10,495,146 10,495.146 10,495,146 6,085,832 6,085,832 6,108,237 22,405 5,797,713 24,856,138 197,462 25,053,600 25,463,922 410,322 25,427,453 47,459,639 324,324 47,783,963 47,973,830 189,867 43,835,536 8,071,026 (774,120) 7,296,906 8,517,380 1,220,474 10,132,129 57,857,261 (48,849,422) 9,007,839 9,476,990 469,151 18,994,289 395,620,783 (46,487,060) 349,133,723 358,908,797 9,775,074 330,379.338 (52,219,002) 45,227,250 (6,991,752)

(17,503,854) 10,512,102 (1,839,965) 86,282,962 7,414,714 93,697,676 92,882,676 815,000 81,295,130 (29,992,440)

(51,955,889)

(81,948,329)

(85,674,400) 3,726,071 (80,842,792) 56,290,522 (44,541,175) 11,749,347 7,208,276 4,541,071 452,338 4,071,520 686,075 4,757,595 (10,295,578) 15,053,173 (1,387,627) 44,509,071 (5,303,875) 39,205,196 10,315,578 28,889,618 40,592,823 (500,000) 500,000

$ 48,080,591 (4,117,800) 43,962,791 20,000 43,942,791 39,205,196 (1) Includes adjustments to expenseslexpenditures for current year encumbrances, payments against prior year encumbrances, accrued payroll, compensated absences, and amounts budgeted as operating transfers.

(2) Includes adjustments to revenues/transfers required for adjusted budget basis presentation.

(3) Actual expenses include employee training costs and amounts budgeted as fund-level expenses or operating transfers. Actual-budget basis expenditures Include employee training costs, budgeted payroll accrual, and amounts budgeted as fund-level expenses.

74 I

GENERAL FUND SCHEDULE OF REVENUES - BUDGET AND ACTUAL-BUDGET BASIS Year ended September 30, 2001 With comparative totals for vear ended September 30. 2000 CITY OF AUSTIN, TEXAS Exhibit B-3 2001

-Actual Adjustments.

Budget (11 Basis 2000 Variance-Actual Favorable Budget Budget (Unfavorablel Basis Taxes Property taxes:

Current Derinquent

,Penalty and Interest Sales taxes Other taxes Total taxes Franchise fees Fines, forfeitures and penalties Library fines Traffic fines Parking violations Weights and measures Other Total fines, forfeitures and penalties Licenses, permits and Inspections Parking meters Alarm permits Commercial solid waste Public health Development Building safety Beer and wine permits Other Total licenses, permits and Inspections Charges for serviceslgoods Recreation and culture Public health Ermergency medical services General govemment - -,

Total charges for services/goods Interest and other Interest Rental income Sale of property Municipal Utility Districts Other" I

Total interest and other.,

Nondepartmental revenues Total revenues

$ 123,581,214 607,885 741.836 123,218,291 3.600.592 123,581,214 123,311,622 269,592 113,789,108 607,885 635,534 (27,649) 853,714 741,836 621,149 120,687 685,147 123,218,291 131,813,000 (8,594,709) 122,157,210 3,600,592 3.162,000 438.592 3.178.505 251,749,818

-251,749,818

-259,543,305 (7,793,487) 240,663,684 31,452,706 31,452,706 28,002,200 3,450,506 23,699,065 371.703 371.703 412,809 (41,106) 402.670 8,160.598 8,160,598 8,188,920 (28,322) 7,511,479 2,503,208 2,503,208 2.745,400 (242.192) 2,654,595 109,297 109,297 117,800 (8,503) 116,785 5,854,960 5,854,960 5,220,026 634,934 5,354,203 16,999,766 16,999,766 16,684,955 314,811 16,039,732 2,085,510 2,085,510 1.989,851 95,659 - -

2,221,750 1,545,202 1,545,202 1.508,615 36,587 1,599.937.

864,393 864,393 651,000 213,393 524,288 1,175,291 1,175,291 1,182,432 (7,141) 1,067.454 1,852,244 1,852,244 1,688,688 163,556 1,819,335 9,636,792 9,636,792 9,450,568

-186,224 10,332,575 241,128 241,128 212,000 29,128 240.045 230,337 230,337 270,594 (40,257) 368,501 17.630.897 17.630.897 16.953.748 677.149 18.173.885 2,030,173 2,030,173 1,943,350 86,823 2,132.582 976,474 976,474 1,066,254 (89,780) 1,074,132 9,828,763 1--

,9,828,763 7,425,200 2,403.563 7,724,476 2,149,121 (1,259,810) 889,311 "-'

828,029 61,282 826,628 14,984,531 (1,259,810) 13,724,721 11,262,833 2,461,888 11,757,818 7,742,749 7,742,749 7,299,200 443,549 7,073,089 351,605 351,605 265,030 86,575

--324.783 607,198 607,198 171,003 436.195 504,688 1,930 1,930 1,930 13,358

-1,880,581 1,880,581-- -L11,222,669

-657,912 1,494,454 10,584,063 10,584,063 8,957,902 1,626,161 9,410,372

'8,794,817

"$ 343,401,781 (1,259,810) 342,141,971 - 341,404,643 737,028

-328,539,373 (1) Adjustments and actual-budget basis include amounts budgeted as fund-level revenues.

75 Actual I

GENERAL FUND SCHEDULE OF EXPENDITURES BUDGET AND ACTUAL-BUDGET BASIS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CITY OF AUSTIN, TEXAS Exhibit B-4 2001 Actual Adjustments Budget (1)

Basis 2000 Variance-Actual Favorable Budget Budget (Unfavorable)

Basis Administration Municipal Court:

Salaries and fringe benefits Contractual services Commodities Expense refunds Capital outlay Total administration Urban growth management Neighborhood Planning and Zoning:

Salaries and fringe benefits Contractual services Commodities Expense refunds Capital outlay Development Services and Watershed Protection:

Salanes and fnnge benefits Contractual services Commodities Expense refunds Capital outlay Total urban growth management Public safety Police:

Salanes and fringe benefits Contractual services Commodities Expense refunds Capital outlay Fire:

Salaries and fringe benefits Contractual services Commodities Indirect cost Expense refunds Capital outlay Emergency Medical Services:

Salaries and fringe benefits Contractual services Commodities Expense refunds Capital outlay Total public safety 7,387.222 1,816,338 238.726 (95,565) 78,785 110,037 7,497,259 7,625,605 128,346 6,635,931 (94,115) 1,722,223 1,881,376 159,153 1,794,931 409 239,135 193,439 (45,696) 276,248 (95,565)

(5,066) 90,499 (74,139)

(19,776) 59,009 62,410 3,401 584,114 9,425,506 (3,445) 9,422,061 9.757,764 335.703 9,217,085 2.811,766 34,301 2,846,067 3,335,896 489.829 496,814 24,126 520,940 694,180 173,240 90,653 13,941 104,594 135,899 31,305 (4,200)

(4,200)

(35,000)

(30,800) 13,329 2.951 16,280 54.064 37,784 3,408,362 75,319 3,483,681 4,185,039 701,358 6,919,538 79.901 6,999.439 7,380,987 381,548 8,773,963 1,257,809 (76,219) 1,181.590 1,379,028 197,438 1.776,690 134,253 (24,541) 109.712 97,520 (12,192) 203,691' (164,208)

(164.208)

(166,628)

(2,420)

(760,656) 13,709 (12,250) 1.459 152,170 150,711 221,844 8,161,101 (33,109) 8,127,992 8,643,077 715,085 10,215,532.

11,569,463 42,210 11,611,673 13,028,116 1,416,443 10.215,532 111,388,565 736,632 112,125,197 111.723,005 (402,192) 99,117,919 12,750,989 36,344 12,787,333 12,293,390 (493,943) 10,737,621 2,077,292 153.230 2,230,522 2,774,425 543,903 1,747,438 (4,366,648)

(16,449)

(4,383,097)

(2.996,669) 1,386,428 (5,763,748) 1,166,244 164,005 1,330.249 2,140.913 810,664 1,846,312 123,016,442 1,073,762 124,090.204 125,935,064 1,844,860 107,685,542 67,923,812 506,018 68,429,830 69,491,848 1,062,018 62,160,210 4.972.470 153,184 5,125,654 5,215,323 89,669 5.597,353, 1,616.478 (118,166) 1,498,312 1,808,736 310,424 1,919,723 228,287 228,287 201,025 (27,262) 186.607 (3,802.287)

(3,802,287)

(3,768,968) 33,319 (3,714,131) 165.520 247.443 412,963 325,500 (87,463) 90.491 71.104.280 788,479 71,892,759 73,273,464 1,380,705 66,240,253 13,055,379 140,186 13,195,565 14,887,178 1.691.613 13,425,519 1,823,298 (20,268) 1,803,030 1,823.387 20,357 2,045.561

-1,219.145 32,678 1,251,823 1.395.302 143.479 1,248,126 (237,509) 3,585 (233,924)

(228.526) 5,398 (538,142) 299,801 395,460 695,261 889.764 194,503 240,258 16,160,114 551,641 16,711,755 18,767.105 2,055,350 16,421,322

$ 210,280,836 2,413,882 212,694,718 217,975,633 5,280,915 190.347,117 (1) Includes adjustments for current year encumbrances, payments against prior year encumbrances, accrued payroll.

compensated absences and amounts budgeted as operating transfers.

76 Actual (continued)

GENERAL FUND SCHEDULE OF EXPENDITURES BUDGET AND ACTUAL-BUDGET BASIS "Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CITY OF AUSTIN, TEXAS Exhibit B-4 (Continued) 2001 2000 Actual-Variance-Actual Adjustments Budget Favorable Budget Public services and utilities Public Works and Transportation:

Salaries and fringe benefits Contractual services Commodities Indirect cost (Expense refunds Capital outlay "Street lighting Transportation, Planning and Sustainabilitý Salaries and fnnge benefits Contractual services Commodities Indirect cost

-Expe-nse refunds Capital outlay Total public services and utilities Public health Health and Human Services:

Physician stipend/chanty care Medical Assistance Program hospital contracted services/

patient services I.

Actual (1)

Basis Budget (Unfavorable)

Basis 543,950 4,292 548,242 602,944 54,702 5,557,985 72.386 (9,142) 63,244 16,965 (46,279) 2,137,948 56,462 (45,021) 11,441 20.725 9,284

- 1,878,422 518,096 (525,106)

(525,106)

(517.897) 7,209 (4,334,553) 27,673 (27,673) 4,600 4,600 83,065 76.375 175,365 (77,544) 97,821 127.337 29,516 5,917.338 8,651,569 108,544 8.760,113 9,956,864 1,196,751 2.868,390 76,625 2,945,015 2,944,984 (31) 2.078,286 47.585 2,125,871 1,259,376 (866,495) 632,859.

632,859 461,000 (171,859)

(4,916,903)

(4,916,903)

(4,723,769) 193,134 30,370

• 6,839 37,209 85,987 48,778 9,344,571 239,593 9,584,164 9,984,442 400,278 9.519.936 162,049 -

9,681,985

- 10,111,779 429,794 5,917,338 10,495,146 10,495,146 10.495,146 10,495,146 6,085,832 6,085,832 6,108,237 22,405 5,797.713 Salaries and fringe benefits 16,179.616 208,707 16,388,323 16,053,970 (334,353) 15,859,788 Contractual services 22,883,194 53,341 22,936.535 22,999,837 63,302 17,386,550 Commodities 1.028,424 85,690 1,114,114 1,121,476 7,362

, 1,138,529 Expense refunds (15,547.239)

(15,547,239)

(14,821,767) 725,472 (9,365,949)

Capital outlay 312,143 (150,276) 161,867 110,406 (51,461) 408,535

, Other public health 24,856.138 197,462 25,053,600 25,463,922 410.322 25,427.453 Total public health

$ 41,437,116

-197,462 41,634,578 -

42,067,305 432.727, 41,720,312 (1) Includes adjustments for current year encumbrances, payments against prior year encumbrances, accrued payroll, compensated absences and amounts budgeted as operating transfers (continued) 77 w

GENERAL FUND SCHEDULE OF EXPENDITURES BUDGET AND ACTUAL-BUDGET BASIS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CITY OF AUSTIN, TEXAS Exhibit B-4 (Continued) 2001 Actual Adjustments Budget (1)

Basis Variance Favorable Budoet (Unfavorablel Public recreation and culture Parks and Recreation:

Salaries and fringe benefits Contractual services Commodities Indirect cost Expense refunds Capital outlay Austin Public Library Salaries and fringe benefits Contractual services Commodities Expense refunds Capital outlay Total public recreation and culture Social services management Nondepartmental expenditures (2)

Total expenditures General fund expenditures Salaries Contractuals Commodities Indirect cost Expense refunds Capital outlay Street lighting Social services management Nondepartmental expenditures Total expenditures

$ 23.165,712 281,931 23,447.643 24,715.456 1,267,813 20.598,620 7,782,525 2,205 7,784.730 6,327.023 (1,457,707) 7,534,808 2,259,935 (145,563) 2.114,372 2,217,183 102,811 2,482,538 304,565 304,565 338.000 33,435 254,722 (3,452,269)

(3,452.269)

(3,050,654) 401,615 (3,342,330) 308,429 (15,868) 292.561 122,898 (169,663) 189.225 30,368,897 122,705 30,491,602 30,669,906 178.304 27,717,583 12,988,246 188,211 13,176,457 12,979,708 (196,749) 11,518,338 2,367,372 22,240 2,389,612 2,234,619 (154,993) 2,480,870 1,988,492 (5,973) 1,982,519 2,078,766 96,247 2,270,553 (269,648)

(269,648)

(181,169) 88,479 (256,348) 16,280 (2,859) 13,421 192,000 178,579 104,540 17,090,742 201,619 17,292,361 17,303,924 11,563 16,117,953 47.459,639 324,324 47,783,963 47,973,830 189,867 43,835,536 8,071,026 (774.120) 7,296,906 8,517,380 1,220,474 10,132,129 57,857,261 (48,849,422) 9,007,839 9,476,990 469,151 18,994,289 395,620,783 (46,487,060) 349,133,723 358,908,797 9,775,074 330,379,338 271.015,375 2,398,760 273,414,135 278.753,461 5.339,326 243,648,273 75,672,563 168,321 75,840,884 74,413.495 (1,427,389) 67.785,191 12,788,146 (5,731) 12,782,415 13,102,847 320,432 13,165,268 1,165,711 1,165,711 1,000,025 (165.686) 959,425 (33,381,582)

(12,864)

(33,394,446)

(30,496.113) 2,898,333 (28.149,996) 2,432,283 587,996 3,020,279 4,140,712 1,120,433 3.768,384 76,375 8,071,026 (774,120) 7,296,906 8,517,380 1,220,474 10.132.129 57,857,261 (48,849,422) 9,007,839 9,476,990 469,151 18,994,289

$ 395,620,783 (46,487.060) 349,133,723 358,908,797 9,775.074 330.379,338 (1) Includes adjustments for current year encumbrances, payments against prior year encumbrances, accrued payroll, compensated absences and amounts budgeted as operating transfers or fund-level expenditures.

(2) Actual expenses include employee training costs and amounts budgeted as fund-level expenses or operating transfers. Actual-budget basis expenditures include employee training costs, budgeted payroll accrual, and amounts budgeted as fund-level expenditures.

78 Actual 2000 Actual Budget Basis

GENERAL FUND SCHEDULE OF TRANSFERS BUDGET AND ACTUAL-BUDGET BASIS Year ended September 30, 2001 With comnarative totals for year ended September 30, 2000 CITY OF AUSTIN, TEXAS Exhibit B-5 Operating transfers In General fund:

Emergency reserve Contingency reserve Enterprise funds:

Elechic Water and Wastewater Parks and Recreation Total operating transfers In 2001 Actual Adjustments Budget Variance Favorable 2000 Actual Budget Actual (1)

Basis Budget (Unfavorable)

Basis 2,658,310 2,658,310 2,658,310 3.496,594 3,496,594 3,496,594 2.943,527 67,283,000 50,000 67,333.000 66.518,000 815.000 61,200,000 18,541.446 1.209,810 19,751,256 19,751,256 17,151,603 458,516 458,516 458,516 86,282,962 7,414,714 93,697,676 92,882,676 815,000 81,295,130 Operating transfers out General fund:

Emergency reserve Contingency reserve Special revenue funds' Balcones Canyonlands Conservation Plan Barton Spnngs Conservation Fee Waiver Neighborhood Housing and Conservation Planning, Environmental and Conservation Services Strategic Planning Investment Sustainability Fund Tourism and Promotion Voluntary Utility Assistance Capital project funds Enterprise funds:

Electric Solid Waste Services Drainage Internal service funds:

Fleet Maintenance Support Services Information Systems Employee Benefits Radio Communication Infrastructure Support Services Capital Projects Management Trust and agency funds:

First Step - A Community Project Housing Trust Social Equity Total operating transfers out Net transfers 3,248,125 3,248,125 3,248,125 160,000 45,000 1,162,995 14,307,479 125,382 152,000 12,656,726 1,084,354 298,504 160,000 45,000 160,000 45,000 1,162,995 1,143,051 14,307,479 14,748,738 125,382 125,382 152,000 152,000 12,656,726 12,656,726 65,817 3,918,075 26,280,633 12,758,616 244,894 3,924,006 1,515,723 29,992,440 51,955,889

$ 56,290,522 (44,541,175) 65,817

"-1,084,354 298.504 165,817 1,084,354 298,504 3,918,075 3,918,075 26,280,633 29,432,312 12,758,616 12,758,616 244,894 244,894 3,924,006 3,977,083 1,515,723 1,515,723 81,948,329 85,674,400 11.749.347 7.208,276 1,230.641 2,735,822 160,000 45,000 7,000 (19,944) 1,475,624 441,259 100,000 3,151,679 53,077 3,726,071 4,541,071 4,183,441" 1,504,813 125,382 160,000 20,152,798 129,641 353,020 1,826,504 6,962,371 23,693.171 9,575,591 500,000 3,143,054 1,578,919 300,000 I1,000,000 80,842,792 452.338 (1) Includes adjustments to actual transfers required for adjusted budget basis presentation.

79 I

F lv

0

SPECIAL REVENUE FUNDS Special revenue funds are used to account for th'_ proceeds of specific revenue -sources (other than special assessments,'

expendable trusts or major capital projects) that are 'legally restricted to expenditures for specific -purposes. Included in the special revenue funds are:

Federal grants funds; State grants funds; Other special revenue grants funds; Other special revenue funds - see next page for

-, descriptions of the individual funds; o

Housing Assistance fund - provides housing assistance to the citizens of Austin'.

r

-t

• Other Special Revenue Funds Animal Shelter Building - Accounts for donations to improve the Townlake7Animal Shelter.

APD Incident Management Fund - Established to account for funds from Capital Metro to the Austin Police Department to establish a traffic command center within the Austin Police Department '

Austin Industrial Development Corporation (AIDC) - Accounts for the administrative costs related to the Corporation.

Austin Inner City Redevelopment Corporation - A:ccounts for the activity of this entity.

Austin Music Channel - Established as a program with Austin Music Channel Company to manage and promote Austin as 'The Uve Music Capital of the World."

Austin Transportation Study -

Coordinates regional transportation planning.

Aviation Asset Forfeiture - Accounts for the redistribution of proceeds generated by airport police enforcement activities.

Balcones Canyonlands Conservation Plan (BCCP) - Accdunts for the City's and County's management of preserve systems.

Barbara Jordan Memorial - Accounts for donations for a future memorial.

Barton Springs Conservation - Accounts for habitat conservation in Barton Springs.

Cable TV - Payments from the Austin Cablevision Company and disbursement to Austin Access Television Campaign Financing - Accounts for donations and fees for the Austin Fair Campaign Ordinance.

Child Safety - Accounts for certain fines and fees used to provide school crossing guard programs at City schools.

COA Customer Assistance Fund - Accounts for funds donated to assist citizens with utility bills who are facing extreme emergencies.

Disproportionate Share - Proceeds used for improvements to the City's clinic system in order to serve patients Downtown Development - Accounts for the relocation of music venue facilities.

EMS Travis County Reimbursed - Accounts for expenses incurred in providing for expended emergency medical services to the citizens of Travis County, located outside the City of Austin and the corresponding reimbursements from Travis County.

Energy Conservation Rebates and Incentives - Used for energy loans and rebates/ incentives to customers; funded primanly by Electric Fund.

Environmental Remediation - Accounts for remediation of sites which affect ground and surface water quality or public health and safety for which the City has either partial or total liability.

Federally Qualified Health Center - Accounts for services provided to City residents in the City's primary care health centers.

Fee Waiver-Accounts for funds provided to allow for payment of fees waived by Council through City Ordinance.

Fire Miscellaneous - Accounts for contributions for specified purposes and for "The Firehouse," a public safety awareness exhibit which is transported to different sites throughout Austin.

Fiscal Surety - Land Development - Escrow funds received from contractors for hydromulchlerosion control.

Friends of East Austin Youth - Accounts for donations from the Friends of East Austin Youth Golf Toumament to fund programs benefiting the youth of East Austin.

Health and Human Services Travis County Reimbursed - Accounts for expenses Incurred by the City on behalf of Travis County and the corresponding reimbursement from Travis County for Health and Human Services and Federally Qualified Health Center programs.

Health Miscellaneous - Accounts for contributions for Strategic Intervention for High Risk Youth.

Hotel-Motel Occupancy Tax - Accounts for hotel/motel occupancy tax revenues and transfers of these revenues to participating funds.

Housing Miscellaneous - Accounts for donations to the Housing program to be used for specified purposes.

Leveraged Loan Pool - Used to leverage private capital and state or federal resources to stimulate business investments.

Lbrary City Literacy Program - Accounts for fundralsing efforts to help fund the City's Workplace Uteracy Program.

Medicaid Administrative Claims - Holds additional Medicaid proceeds.

Municipal Court Building Secunty-Provides funding to enhance courthouse security.

Municipal Court Technology - Provides funding for technological enhancements to Municipal Court operations.

Music Loan Program - The City serves as the guarantor of loans made by banks to this program.

Neighborhood Housing and Conservation - Established in 1996 to lead economic development, affordable housing, and neighborhood revitalization efforts.

Office of Emergency Management Miscellaneous - Accounts for contributions for public safety awareness.

One Texas Center - Accounts for revenue and debt service requirements for the City's One Texas Center site.

PARD Cultural Projects - Records activities for cultural project purposes. Funded by a portion of bed tax receipts PARD Police Asset Forfeitures - Accounts for the redistnbution of proceeds generated by PARD police enforcement activities.

Pavement Life Recovery Collection of fees associated with pavement life recovery costs.

Planning, Environmental Conservation Services - Accounts for energy and water conservation services and environmental protection activities.

Police Federal Seized Funds - Records all federal seized funds generated by police enforcement activities per State Code of Criminal Procedures (Chapter 59).

Police Seized Money - Accounts for the redistribution of proceeds generated by police enforcement activities.

Public Improvement Distnct - Accounts for the downtown public improvement district, which will provide services, secunty, and improvements for the downtown Austin area.

Railroad Right of Way - Accounts for management of the Austin and Northwestern Railroad right of way.

RMD Conservation - Amounts contributed by the Electric Fund to be used for energy loans and rebates/incentives.

RMD Loan - Accounts for energy loans to customers.

Strategic Planning Investment -

Accounts for costs related to managing and planning for growth by the City of Austin.

Subdivision Participation - Escrow account for funds received from contractors for construction and installation of streets, sidewalks, drainage facilities, etc.

Sustainability Fund - The Sustainability Fund was created to provide resources for on-time projects that will help the City build a sustainable economic, environmental and equitable infrastructure.

Telecommunity Partnership - Accounts for addressing training needs of the Austin community and will create opportunities for Individuals through partnerships with local employers.

Tourism and Promotion - Accounts for the promotion of tourism in Austin as both a leisure and business destination.

Funded by a portion of bed tax receipts.

Vehicle Rental Tax - Accounts for the levy of a short-term motor vehicle rental tax.

Voluntary Utility Assistance - Contributions for the benefit of indigent utility customers.

I

SPECIAL REVENUE FUNDS CITY OF AUSTIN, TEXAS COMBINING BALANCE SHEET Exhibit C-1 Septemb'er 30,'2001 With comparative totals for September 30, 2000 ASSETS Cash Pooled Inve'stments ýnd cash invesni'mnts, *at fair *,alue Accounts recelvable,*riet Notes'i6eilvabI6, ret' Receivables from other'g6vemrients Due from other funds Inventories, at cost Realiiprol)erty held for re'sale Other assets co Total assets LIABILITIES AND FUND BALANCES Liabilities:

Accounts payable A~crued payroll Accrued compensated absences Due to other funds Deposits and other liabities Total liabnitles Fund balances' Reserved for encumbrances Reserved for Inventories Reserved for notes receivable Reserved for real property held for resale Unreserved, designated for future use Unreserved, undesignated.

Total fund balances Total liabilities and fund balances Other Special Revenue Federal Other' seinalu S

Revenue Housing Totals Grants Grants Grants Funds -

'q Assistance 2001 2000 6,835 6,835 5,600 S5,272,269 187,952.

96,004 49,759,321 1,839,583 57,155,129 50,567,495 903,585

- ' 903,585 858,311 S......

11,819,267 1,721,990 13,541,257 15,793,314 3,441,706 3,441,706 5,040,609 9,449,247 932,616 95,231 10,477,094 14,307.025 13,689,040 13,689,040 16,453,847 259,336 259,336 4,290,745 4,290,745 1,923,982 97,221 730,871

' 102,524 930.616

'944,189 14,818,737 "

1,120,568 191,235 76,264,670 12,300,133 104,695,343 105,894,372 1,485,154 104,455 534 2,491,771 608,257 4,690,171 4,148,748 268,918 268,918 208,173 192,714 192,714 145,962 8,018,701 849,390 94,722 4,876,227 13,839,040 16,453,847 5,314,882 166,723 95,979 36,951,921 3,492,752 46,022,257 40,796,015 14,818,737 1,120,568 191,235 44,781,551 4,101,009 65,013,100 61,752,745 3,276,115.

.3,276,115 4,096,365

'259,336 259,336 3,441,706 3,441,706 5,040,609 4,290,745 4,290,745 1,923,982 S......

28,781,050 466,673 29,247,723 33,760,268 (833,382)

(833,382)

(679,597) 31,483,119 8,199,124 39,682,243 44,141,627 14,818,737 1,120,568 191,235 76,264,670 12,300,133 104,695,343 105,894,372 State I

SPECIAL REVENUE FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CITY OF AUSTIN, TEXAS Exhibit C-2 REVENUES Intergovernmental:

Grants Other.

Taxes Fines; forfeitures and penalties Charges for serviceslgoods Interest and other Total revenues EXPENDITURES Administration (1)

Special projects Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES)

Operating transfers in Operating transfers out Total other financing sources (uses)

Excess (deficiency) of revenues and other sources over expenditures and other uses Fund balances at beginning of year, as previously reported Adjustment for a change in accounting pnnciple Fund balances at beginning of year, as restated Residual equity transfers in (out)

Fund balances at end of year Federal State Other Special Revenue Other Special Revenue Housing Totals Grants Grants Grants Funds Assistance 2001 2000 38,019,169 3,844,744 443,558 42,307,471 35,804,413 36,178,201 36,178,201 36,362,545 4,184,809 4,184,809 3,984.938 S......

22,836,690 22,836,690 31,469.731 12,863,935 9,212,644 22,076,579 7,366,232 38,019,169 3,844,744 443,558 76,063,635 9,212,644 127,583,750 114,987,859 58,430,016 58,430,016 56,899,295 38,019,169 3,844,744 443,558 11,324,603 53,632,074 39,230,221 38,019,169 3,844,744 443,558 58,430,016 11,324,603 112,062,090 96,129,516 17,633,619 (2,111,959) 15,521,660 18,858,343 39,320,803 39,320,803 24,216,617 S......

(59,736,704)

(- 59,736,704)

(34,412,302)

(20,415,901)

(20,415,901)

(10,195,685)

(2,782,282)

(2,111,959)

(4,894,241) 8,662,658 24,759,889 10,311,083 35,070,972 28,062,160 9,070,655 9,070,655 7,806,558 S......

33,830,544 10,311,083 44,141,627 35,868,718 434,857 434,857 (389,749) 31,483,119 8,199,124 39,682,243 44,141,627 (1) Expenditures Include capital outlay of $668,248.

CITY-OF AUSTIN, TEXAS Exhibit C-3 SPECIAL REVENUE FUNDS COMBINING BALANCE SHEET - ALL SPECIAL REVENUE GRANTS September 30, 2001 With comnarative totals for September 30, 2000 1

0 Assets.+

Receivables Pooled from Investments Other and CashII FEDERAL GRANTS U.S. Department of Agdculture U.S. Department of Energy Equal Employment Opportunity Commission J,

U.S Department of Justice 338,076 U.S. Department of Labor U.S. Department of Transkprtation 8,887 U.S. Federal Emergency Management U.S. Health & Human Services, ',,

747,558 U S. Houslng/Urban Development 3,966,066 U.S. National Foundation on the 0

Arts and Humanities 11,359 CIO U.S. Department of Veteran-s Affairs 200,323 Total Federal Grants 5,272,269 STATE GRANTS Texas Governor's Offlce6'Crmlnal Justice Division Texas Health Department 13,519 Texas Comptroller of Public Accounts 66,090 Texas Health and Human Services Commission 15,338 Telecommunications Infrastructure Fund Board I-Texas Parks and Wildlife f

3,015 Texas Department of Transportation

+89,476 The University of Texas at Austin Center of Criminology 514 Texas State Library Archives Commission State Energy Conservation Office Texas Workforce Commission Total State Grants,-

187,952 OTHER 6PE' CA"LiREiVENUE GRANTS 96,004 Total All Grants 5,556,225 2000 Tta,

$ 3,964,660 Liabilities and Fund Balances Oth~e`r" Total Accounts Due to Other Total Assets Assets Payable Other Funds Liabilities Liabilities 734,346 5,154 739,500 94,875 591,873 74 435,073 94,209 2,859,135 4,272,682 366,980 9,449,247 12,054 80,013 94,875 929,949 74 443,960 94,209 3,618,747 8,318,761 378,339 200,323 97,221 14,818,737 269,623 269,623 409,870 423,389 66,090 28,933 44,271 4,158 189,949 15,849:"

14,234 ' -

7,173 279,425 514 1 15,849" 14,234 7,849 731,651 104,529 3,531 434 956,252 407,623 4,936 1,485,154 35,391 8,544 3,121 44,271 499 9,836 2.793 94,875 577,020 74 431,542 93,775 1,946,310 3,781,410 362,044 8,018,701 234,232 406,046 3,659 180,113 248,400 8,887 716,185 4,129,728 11,359 200,323 5,314,882 739,500 94,875 929,949 74 443,960 94,209 3,618,747 8,318,761

- 378,339 200,323 14,818,737 Total Liabilities Fund and Fund Balances Balances 739,500 94,875 929,949 74 443,960 94,209 3,618,747 8,318,761 378,339 200,323 14.818.737 269,623 8,799 423,389 62,969 66,090 44,271 3,015 7,173 89,476 279,425

-514.

15,849 S,9,491 1,950

.. 514 15,849

+'14,234 269,623 423,389 66,090 44,271 7,173 279,425 514 15,849 14,234 932,616 1,120,568 104,455 849,390 166,723 1,120,568 1,120,568 95,231 191,235 534 94,722 95,979 191,235 191,235 10,477,094 97,221 16,130,540 1,590,143 8,962,813 5,577,584 16,130,540 16,130.540 14,307,025 353,995 18,625,680 1,789,270 11,662,876 5.173,534 18,625,680 18,625,680 GovernmenLS

SPECIAL REVENUE FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - ALL SPECIAL REVENUE GRANTS For year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CITY OF AUSTIN, TEXAS Exhibit C-4 Fund Balances September 30, 2000 Fund Balances September 30, 2001 FEDERAL GRANTS U.S. Department of Agnculture U.S. Department of Energy Equal Employment Opportunity Commission U.S. Department of Justice U.S. Department of Labor U.S. Department of Transportation U.S. Federal Emergency Management U.S. Health & Human Services U.S. Housing/Urban Development U.S. National Foundation on the Arts and Humanities U.S. Department of Veterans Affairs Total Federal Grants STATE GRANTS Texas Govemor's Office Criminal Justice Division Texas Health Department Texas Comptroller of Public Accounts Texas Health and Human Services Commission Telecommunications Infrastructure Fund Board Texas Parks and Wildlife Texas Department of Transportation The University of Texas at Austin Center of Criminology Texas State Library and Archives Commission State Energy Conservation Office Texas Workforce Commission Total State Grants OTHER SPECIAL REVENUE GRANTS Total All Grants 2000 Totals' 3,035.389 3,035,389 4,571 4,571 169,500 169,500 4.051,763 4,051,763 274,532 274,532 2,405,575 2,405,575 210,138 210,138 9,702,828 9,702,828 16,889,626 16,889,626 1,275,240 1,275,240 7

7 38,019,169 38,019,169 498,950 498,950 1,952,574 1,952,574 78,836 78,836 173,827 173,827 148,100 148,100 14,488 14,488 959,547 959,547 475 475 16,413 16,413 21,390 21,390 (19,856)

(19,856) 3.844,744 3,844,744 443,558 443,558 42,307,471 42,307,471 35,804,413 35,804,413 Revenues Inter oovernmental Expenditures Special Prolects Excess (Deficiency)

Of Revenues Over Expendltures

CITY OF AUSTIN, TEXAS Exhibit C-5 SPECIAL REVENUE FUNDS COMBINING SCHEDULE OF EXPENDITURES - ALL SPECIAL REVENUE GRANTS From Inception to September 30, 2001 FED'ERAL GRANTS U.S. Department of Agriculture, U.S. Department of Energy Equal Employment Opportunity Commission-U.S. Department of Justice U.S. Department of Labor U.S. Department of Transportation U S. Federal Emergency Management U S. Health & Human Services L

U S. Housing/Urban Devel6pirent U.S. National Foundation on the I Arts and Humanities U.S. Department of Veterans Affairs LA Total Federal Grants STATE GRANTS Texas Governor's Office Criminal Justice Division Texas Health Department Texas Comptroller of Public Accounts Texas Health and Human

'Services Commissidn.

Telecommunications Infrastructure Fund Board '

Texas Parks and Wildlife Texas Department of Transportation The University of Texas at Austin Center of Criminology Texas State Library and Archives Commission State Energy Conservation Offile Texas Workforce Commission Total State Grants OTHER SPECIAL REVENUE GRANT Total'All "Grants' Total Expenditures at September 30, 2000 In-Kind Current Year In-Kind Total Expenditures at September 30, 2001 Budget In-Kind Grant -

Match Total Grant - - - Match- -.

Grant Match -

-- Total Grant Match Total

$ 2,659,210 218,190 2,877.400 3,035,389 (38.173) 5,694,599 180,017 5,874,616 5,688,606 5,688,606 25,379 30,000 55,379 4,571 29,950 30,000 59,950 30,000 30,000 60,000 150,450 150,450 169,500 319,950 319,950, 336,200 336,200 13,753,028 3,392,929 17,145,957 4,051,763 2,347,174 17,804,791 5,740,103 23,544,894 20,712,080 8,590,273 29,302,353 362,708 95,589 458,297 274,532 91.562 637,240 187,151 824,391 876,284 109,895 986,179 6,330,187 1,701,092, 8,031,279 2,405,575-889,281 8,735,762 2,590,373 11,326,135 16,497,655 5,487,965 21,985,620 194,471 410,361 604,832 210,138 445,099 404,609 855,460 1,260,069 738,353 416,771 1,155,124 15,996,606 2,404,699 18,401,305 9,702,828 1,198,174 25,699,434 3,602,873 29,302,307 32,225,781 6,499,473 ' 38,725,254 90,901,187 664,988 91,566,175 16,889,626 107,790,813 664,988 108,455,801 133,796,326 700,000 134,496,326 1,814,796 1,814,796 1,275,240 3,090,036 3,090,036 4,513,219 4,513,219 153,766-153,766 7

_- 153,773 153,773 338,836 338,836 132,341,788 8.917,848 141,259,636 38,019,169 4,933,117 170,360,957 13,850,965 184,211,922 - 215,753,340 21,834,377 237,587,717 691,964 228,970 920,934 498,950 122,560 1,190,914 351,530 1,642,444 1,927,277 496,840

-2,424,117 2,446,830 2,446,830 1,952,574-

-4,399,404 -

4,399,404 5,793,654 5,793,654 362,415 362,415 78,836 441,251 441,251 497,931 497,931 173,827 173,827

-o 173,827 206,992 206,992 218,787 3,680 222,467 148,100 60,000 366,887 63,680 430,567 1,540,726 142,435-1,683,161 22,257 22,257 14,488 19,317 36,745 19,317 56,062 130,000 44,047 174,047 1,728,058 640,445 2,368,503 959,547 513,575 2,687,605 1,154,020 3,841,625 3,864,826 1,885,725 5,750,551 9,061

'9,061 475 9,536 9.536 10,000 10,000 16.413 13,659 16,413 13,659 30,072 17,727" 13,659 31.386 21,390 21,390

- : I -

21,390 50,000 15,000 r,

65,000 19,856 8.547 28,403 (19,856) 8,547 8,547 25,000 8,333 33,333 5,499,228 881,642' 6,380,870 3,844.744 729,111 9,343,972 1,610.753 10,954,725 14,064,133 2,606,039 -;, 16,670,172 S

417,462 24,935 442,397 443,558 861.020 24,935' 885,955 1,449,288 39,600 1,488,888

$138,258,478 9,824,_42"5 1i48,0b82i,903i" 42,307,471-5,662.228 0,5-65,9_49' 15.486'.653.196,052'.602.

231,266,761 -24.480,016 255,746,777 In-Kind

SPECIAL REVENUE FUNDS - ENTERPRISE RELATED COMBINING BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 CITY OF AUSTIN, TEXAS Exhibit C-6 ELECTRIC RELATED U.S. Department of Energy American Public Power Association ICLEI USA, Inc.

Total Electric WATERWORKS AND SEWER RELATED U.S. Environmental Protection Agency co U.S. Fish and Wildlife o

Total Waterworks and Sewer Related r

SOUD WASTE RELATED U.S. Environmental Protection Agency Total Solid Waste AIRPORT RELATED U.S. Department of Transportation Texas Comptroller of Public Accounts Total Airport DRAINAGE American Society of Civil Engineers Total Drainage Total grants, enterprise related 2000 Total Pooled Investments Assets Receivables from Other Total Advanced Pooled Investments Liabilities and Fund Balances Other Total Fund

Total, Liabilities and Fund and Casn uovernments Assets and Cash Liabilities Liabilities Balances Balances 159,141 23,237 182,378 23,237 159,141 182,378 182,378 14,651 14,651 14,651 14,651 14,651 173,792 23,237 197,029 23,237 173,792 197,029 197,029 42,342 42,342 42,342 42,342 42,342 5,383 5,383 5,383 5,383 5,383 47,725 47,725 47,725 47,725 47,725 26,033 26,033 26,033 26,033 26,033 26,033 26,033 26,033 26,033 26,033 584,287 584,287 584,287

-o 584,287 584,287.

13,728

-° 13,728 13,728 13,728 13,728 13,728 584,287 598,015 584,287 13,728 598,015 598,015 187,520 681,282 868,802 681,282 187,520 868,802 868,802 31,537 229,758 261,295 229,235 32,060 261,295 261,295 NOTE: These grants have been reported in the enterprise fund financial statements.

SPECIAL REVENUE FUNDS - ENTERPRISE RELATED COMBINING SCHEDULE OF EXPENDITURES From inceltion to September 30; 2600 CITY OF AUSTIN, TEXAS Exhibit C-7 Total Expenditures at September30, 2000' ELECTRIC RELATED U.S. Department of Energy American Public Power Association ICLEI USA, Inc.

Total Electric,

, Current Year Total Exuenditures at September 30, 2001 Budget In-Kind In-Kind In-Kind In-Kind Grant Match Total Grant Match Grant Match Total Grant Match Total

$ 407,178 935,896 1,343,074 32,130 439,308 935,896 1,375,204 797,784 1,434,778 2,232,562 14,000 14,000 (14,000) 74,655 74,655 349 349 6,000 6,349 6,349 42,000 35,000 77,000 421,527 935,896 1,357.423 24,130 445,657 935,896 1,381,553 914,439 1,469,778, 2,384,217 WATERWORKS AND SEWER RELA U.S. Environmental Protection Agen U.S. Fish and Wildlife Total Waterworks and Sewer Related C!

SOLID WASTE RELATED

-4 U.S. Environmental Protection Agen Total Solid Waste

. AIRPORT RELATED U S. Department of Transportation Texas Comptroller of Public Accoun Total Airport DRAINAGE American Society of Civil Engineers Total Drainage Total grants, enterprise relate

• TED

• cv 975.428 975.428 7.249,293 8,224,721 8,224,721 10,055,000 10,055,000 5,383 5,383 5,383 25,000 25,000 975,428 975,428 7,254,676 8,230,104 8,230,104 10,080,000 10,080,000 cy 109,314 109,314 72,407 181,721 181,721 700,000 700.000 109,314 1 109,314 72,407 181,721 181,721 700,000 700,000 2,750.000 916,666 3,666,666 9,413,159 3,137,723 12,163,159 4,054,389 16,217,548 27,317,635 8,697,545 36,015,180 is 3,950 3,950 1,270 5,220 5,220 7,728 7,728 2,753,950 916,666 3,670,616 9,414,429 3,137,723 12,168,379 4,054.389 16,222,768 27,325,363 8,697,545 36,022,908 12,514 12,514 12,514 12,514 1

12,520 12,520 12,514 12,514 12,514 12,514 12,520 12,520 d

$4,272,733 1852.562 6.125.295 16.765.642 3.137,723 21,038,375 4,990,285 26,028,660.

39,032,322 10,167,323.49,199,645 NOTE: These grants have been reported In the enterprise fund financial statements.'

I I

I I

SPECIAL REVENUE FUNDS - OTHER COMBINING BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 Assets Pooled Net Investments Accounts Due from Inventories Other Total Cash and Cash Receivable Other Funds at cost Assets Assets Animal Shelter Building APD Incident Management Austin Industrial Development Corporation (AIDC)

Austin Inner City Redevelopment Corporation Austin Music Channel Austin Transportation Study Aviation Asset Forfeiture Balcones Canyonlands Conservation Plan (BCCP)

Barbara Jordan Memorial Barton Springs Conservation Cable TV Campaign Financing Child Safety COA Customer Assistance Disproportionate Share Downtown Development EMS Travis County Reimbursed Energy Conservation Rebates and Incentives Environmental Remediation Federally Qualified Health Center 2,235 Fee Waiver Fire Miscellaneous Fiscal Surety - Land Development Friends of East Austin Youth Health and Human Services Travis County Reimbursed Health Miscellaneous Hotel-Motel Occupancy Tax Housing Miscellaneous Leveraged Loan Pool Library City Literacy Program Medicaid Administrative Claims Municipal Court Building Security Municipal Court Technology Music Loan Program Neighborhood Housing and Conservation 500 Office of Emergency Management Miscellaneous One Texas Center PARD Cultural Projects PARD Police Asset Forfeitures Pavement life Recovery Planning, Environmental Conservation Services Police Federal Seized Funds 4,100 Police Seized Money Public Improvement District Railroad Right of Way RMD Conservation RMD Loan Strategic Planning Investment Subdivision Participation Sustainability Telecommunity Partnership Tourism and Promotion Vehicle Rental Tax Voluntary Utility Assistance 2001 Total 6,835 2000 Total 11,297 367,807 141,407 1,428 2,054 867,021 229,700 1,724,181 1,344 156,394 224,129 18,872 327,974 941 150,000 208,201 175,084 475,9B4 3,889,528 1,923,739 2,775,501 155,608 23,754 12,535 21,646,176 13,539,040 9,829 3,110,673 198,483 145,136 5,831,220 39,169 342,695 2,695 757,304 377,869 839,511 229,471 1,464,969 14,481 1,047,200 10,523 401,073 44.347 235,663 395,961 226,319 883,750 83,132 5,081 97.421 851,674 345,980 4,170,908 599,558 12,202 944,636 1,157,232 1,251,282 90,482 11,297 367,807 141,407 1,428 2,054 867,021 229,700 1,724,181 1,344 156,394 224,129 58,249 77,121 1,346 329,320 150,941 208,201 175,084 475,984 3,889,528 1,923,739 259,336 638 3,193,318 23,754 12,535 35,185,216 9,829 1,505 3,112,178 198,483 5,976,356 39,169 121,490 464,185 2,695 757,304 377,869 839,511 229,471 1,465,469 14,481 1,047,200 10,523 445,420 235,663 400,061 226,319 966,882 5,081 97,421 117,633 969,307 345,980*

4,170,908!

5,410 604,968 12,202 424,600 1,369,236.

2,408,514

, 90,482' 49,759,321 11,819,267 13,689,040 259,336 730,871 76,264,670

$ 5,600 44,940,100 14,256,509 16,453,847 487,670 76,143,726 88

CITY OF AUSTIN, TEXAS Exhibit C-8

-Liabilities..

Fund Balances Accrued Due Deposits Reserved Reserved Total Compen-to and,

I -

for for Unreserved Total Liabilities Accounts Accrued sated Other Other Total Encum-Inven-Undesig-Fund and Fund Payable -,Payroll Absences Funds Liabilities Liabilities brances "torles Designated nated Balances Balances 10 10 39,123 975.148 1,014,271 10,594 10,594 10,391 9,533 -

20,727 33,500 74,151 72,642 72,642 2,198 8,881 258 11,337 150,000 150,000 378 378 56,088 11,900 212,969 280,957 380,333 380,333 49,572 49,572 734,759 244,323 105,051 1,084,133 500 3,208 3,708 449,388 34,258.878 34,708,266 4,598 1,583 8,284 2,832,755 2,921,859 136,245 S--

169,722 171,091 145,136 145,136 715,490 715,490 13,968 2,149 46,752 40,199 92,637 70,355 1 5 0 555,355 555,355 44,093 284,600 47,687 193,919 19,921 3,699 S......

13,646 723,261 119,188

. 23,961 23,961 18,709 1,439,355 1,439,355 _

327,530 342,724 140,132 140,232 150,000 150,000 11,297 11,297-11,297 367,807 367,807 367,807 141,407.

141,407 141,407 1,428' p1,428 1.428 2,044 2,044 i.2,054 30 (147,280).

(147,250),

867,021 14,715 204,391 219,106 " 229,700 7,988 1,642,042 1,650,030

- 1,724,181 1,344

-1,344 1,344 156,394 156,394 156,394 224,129 224,129

- 224,129 4,479 4,479

' 77,121 30,859 287,124 317,983

- 329,320 941 941 150,941 207,823 207,823 208,201 175,084 175,084 175,084 43,255 151,772 195,027 475,984 848,137 2,661,058 3,509,195 3,889,528 1,874,167 1,874,167 o 1,923,739 207,071 259,336 1,642,778 2,109,185 3,193,318 23,754 23,754 23,754 344 8,483 8,827 12,535 476,950 476,950 35,185,216 9,829 9,829,

9,829 54,074 190,319 - 3,112,178 27,392 27,392-

-198,483 5,831,220 5,831,220 5,976,356 39,169 39,169 39,169 464,185 464,185 464,185 2,695 2,695 2,695 41,814 41,814 757,304 361,752,

363,901 377,869 839,511

, 839,511

- 839,511 229,471 229,471

- 229,471 1,302,477 1,372,832

'1,465,469 14,331 14,331 14,481 (555,355)

(555,355) 718,507 1,003,107

.1,047,200 10,523 10,523 10,523 445,420 445,420 445,420 (5,943)'

187,976 235,663 376,441 380,140 " 400,061 212,673 212,673 226,319 243,621 966,882 966,882 5,081 5,081 5,081 97,421 97,421>

97,421 850,119 850,119.

969,307 303,310 322,019 345,980 2,731,553 2,731,553 4,170,908 (65,286) 277,438-

.604,968 12,202 12,202--, - 12,202 1,088,872 1,229,104 1,369,236 2,408,514

-- 2,408,514 2,408,514 (59,518)

(59,518)

- 90,482 89 80,820 1,369 9,370 4,103 150 44,093 47,687 19,921 13,646 119,188 327,530 140,132 2,491,771 268,918 192,714 4,876,227 36,951,921 44,781,551 3,276,115 259,336 28,781,050 (833,382) 31,483,119 76,264,670 2,227,982 208,173 145,962 4,790,971 34,940,094 42,313,182 4,096,365 30,413,776 (679,597) 33,830,544 76,143,726

]

f t

u N

SPECIAL REVENUE FUNDS - OTHER COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES For year ended September 30, 2001 With comparative totals for year ended September 30, 2000 Revenues

Fines, Charges Interest Forfeitures for Services/

and Total Expenditures Taxes and Penalties Goods Other Revenues (1)

Animal Shelter Building 554 554 APD Incident Management 132,193 Austin Industrial Development Corporation (AIDC) 6.938 6,938 Austin Inner City Redevelopment Corporation 70 70 Austin Music Channel 78 78 Austin Transportation Study 1,239,103 1,239,103 1,239,302 Aviation Asset Forfeiture 15,727 19,832 35,559 259,232 Balcones Canyonlands Conservation Plan (BCCP) 1t190.434 65.384 1,255,818 852,635 Barbara Jordan Memodal 66 66 Barton Springs Conservation 6,467 6,467 Cable TV 653,018 5,641 658,659 577,500 Campaign Financing 506 506 Chiid Safety 1,418,023 21,144 1,439,167 1,565,039 COA Customer Assistance 941 941 Disproportionate Share 176,191 Downtown Development 8,885 8,885 9,672 EMS Travis County Reimbursed 6.089.034 6,089.034 6,124,326 Energy Conservation Rebates and Incentives 8,576,259 8,576,259 7,795,381 Environmental Remediation 72,258 72,258 7,052 Federally Qualified Health Center 8,285,339 2,317,824 10,603,163 18.152.533 Fee Waiver 1,166 1,166 Fire Miscellaneous 2,075 544 2,619 6,977 Fiscal Surety - Land Development 645,144 645.144 Fnends of East Austin Youth Health and Human Services Travis County Reimbursed 4,326,404 4,326,404 4,278,057 Health Miscellaneous 9,575 9,575 Hotel-Motel Occupancy Tax 29,344,429 27,670 29,372,099 Housing Miscellaneous 1,922 1,922 Leveraged Loan Pool 16,200 16,200 59.751 Library City Literacy Program 132 132 Medicaid Administrative Claims 34.725 34,725 Municipal Court Building Secunty 459.541 15,723 475,264 376.504 Municipal Court Technology 560,460 32,644 593,104 234,814 Music Loan Program 229,471 229,471 Neighborhood Housing and Conservation 123,237 123,237 2,129.005 Office of Emergency Management Miscellaneous 3,000 1,009 4,009 17,235 One Texas Center 2,222.959 2,222,959 PARD Cultural Projects 70,201 70,201 3,644,305 PARD Police Asset Forfeitures 516 516 Pavement Life Recovery 234.700 14,103 248.803 Planning, Environmental Consbrvation Services 258,626 Police Federal Seized Funds 180,913 14,320 195,233 158,933 Police Seized Money 97.341 18,571 115,912 27.157 Public Improvement District 1,322,445 64,646 1,387,091 1,323,637 Railroad Right of Way 249 249

- RMD Conservation RMD Loan 70 70 Strategic Planning Investment 278,512 Subdivision Participation 204,642 204,642 Sustainability 2,911,729 Telecommunity Partnership 599 599 Tourism and Promotion 62,910 62,910 5,354,777 Vehicle Rental Tax 5,511,327 185,890 5,697,217 Voluntary Utility Assistance 15,758 12,879 28.637-478.941 2001 Total 36,178,201 4,184,809 22,836,690 12,863,935 76,063.635 58,430,016 2000 Total

$36.362,545 3,984,938 31,469,731 1.363,185 73.180,399 56,899.295 (1) Expenditures include capital outlay of $668,248.

(2) See Note 2 90 I

CITY OF AUSTIN, TEXAS Exhibit C-9 Excess Other Financing Sources (Uses)

(Deficiency)

Fund Fund of Revenues Balances Balances zi "and Other September 30, Adjustment

- September 30, Fund Operating Operating Sources Over

2000, for change In

2000,

" Residual Equity Balances Transfers Transfers Expenditures as previously accounting as I I Transfers September 30, In Out and Other Uses reported prlnciple(2)

Restated In (Out) 2001 630,015 45,000 1,925.000 8,650,018-(868,000) 554 (132,193) 6,938 70 78 (199)

(223,673) 1,033,198 66 51,467 81,159 506 (125,872) 941 (176,191)

(787)

(35,292) 780,878 1,122,206 1,100,648 1,166 (4,358) 645,144 48,347 9,575 (31,144,551)

(1,772.452) 1.922 (43,551) 132 34,725 S-98.760 358,290 229,471 1,562,994 i362,464)

(805,238)

(13,226)

(2,416,538)

(193,579) 3,634.952 60,848 516 248,803 (258.626) 36,300 88,755 150,000 213.454 249 70 (278,512) 204,642 17,424,167 (14,235,000) 277,438 599 5,146,657 (145.210)

(10,710,151)

(5,012,934) 152.000 (298,304) 39,320,803 (59.736,704)

(2.782,282) 10.743 134.469 1,358.

1,966 (147,051) 442.779 616,832 1.278 104,927 142,970 3,973 443,855 449,157 175.871 230,319

",2,728,317 751,961 1.008,537 22,588 13,185 (168,194) 9,829 10,743 134,469 1,358 1,966 (147,051) 442,779 616,832 1.278 104,927 142,970 3,973 443,855 449,157 175,871 230,319 2,728,317 751,961 1,008,537 22,588 13,185 (168,194) 9,829 141.972 141,972 17,817 17,817 7.603,672 7,603,672 37,247 37,247 507,736 507,736 2,563 2,563 7,089 7,089 265,141 265,141 481,221 481,221 2,178,070 2,178.070 27,557 27,557 (361,776)

(361,776) 942,259 942,259 10,007 10,007 196,617 196,617 446,602 446,602 343,840 343,840 123,918 123,918 753,428 753,428 4,832 4.832 97.421 97,421 850,049 850.049 600,531 600,531 2,526,911 2,526,911

"-11,603 11,603

'1,374,314

- 1,374,314'-:

"5.954,465.

1,466.983, 2 7,421.448 238.786

- 1 238,786 24.759.889

.,070.655 33,830,544, 91 24,216,617 (34,412.302),

L- -- 6.085,419

, 20,328,316

• " 7,806.558, "28,134,874 -

(389.749)

-33.830.544 11,297 500,000 367,807 S-141.407 1.428 2,044 (147,250) 219,106 1,650,030 1,344 156,394 224,129 4,479 317.983 941 (65,143) 207,823 j

175,084 195.027 3,509,195 1,874,167 2,109,185 23,754 8,827 476,950 9,829 190,319 27,392 5,831,220 39,169 S -

464,185 2,695 41,814 363,901

~

839,511 "229.471 1,372.832 14.331 (555,355) 1.003,107 10,523 445,420 187.976 380.140',

212,673 966,882 5,081, 97.421

' 850.119 S -

322,019

• *2,731,553

.277,438 12,202

"*1,229.104 2,408,514-r- :(59,518) 434,857

.31.483,119 o

SPECIAL REVENUE FUNDS - OTHER CITY OF AUSTIN, TEXAS COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND TRANSFERS -

Exhibit C-10 BUDGET AND ACTUAL-BUDGET BASIS Year ended September 30, 2001 Fund Balances September 30, 2000 Revenues Expenditures Operating Transfer In utUses Operating Transfer Excess of Sources Over Fund Balances September 30, 2001 2001 Aviation Asset Forfeiture Actual budget basis Budget Variance Balcones Canyonlands Conservation Plan (BCCP)

Actual budget basis Budget Variance Child Safety Actual budget basis Budget

• o Variance

""Disproportionate Share Actual budget basis Budget

Variance, EMS Travis County Reimbursed Actual budget basis Budget Variance Energy Conservation Rebates and Incentives Actual budget basis Budget Variance Environmental Remedlation Actual budget basis Budget Vanance 435,790 71,644 364,146 576,701 34,035 542,666 371,561 20,582 350,979 (127,686)

(5,687)

(121,999) 170,732 170,732 970,073 809,774 160,299 748.065 616,324 131,741 35,559 129,000 (93,441) 1,255,818 8,280 1,247,538 1,439,167 1,529.270 (90,103) 269,152 361,700 92,548 806,723 616,425 (190,298) 1,519,755 1,694,191 174,436 (63,750) 63,750 6,089,034 6,123,327 (34,293) 8,576,259 8,973,500 (397,241) 72,258 20,000 52.258 6,093,358 6,123,327 29,969 7,859,624 8,973,500 1,113,876 7,052 50,000 42,948 630,015 630.015 71,709 71,709 (233,593)

(232,700)

(893) 1,079,110 21,870 1,057,240 (152,297)

(236,630) 84,333 63,750 63,750 (4,324)

(4.324),

716,635 716,635 1,122,206 1,052,000 70,206 202,197 (161,056) 363,253 1,655,811 55,905 1.599,906 219,264 (216,048) 435,312 (63,936)

(5,687)

(58,249) 166,408 166,408 1,686,708 809,774 876,934 1,870,271 1,668,324 201,947 (continued) 1,925,000 1,950,000 (25,000) 868,000 868,000

SPECIAL REVENUE FUNDS - OTHER COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND TRANSFERS BUDGET AND ACTUAL-BUDGET BASIS CITY OF AUSTIN, TEXAS Exhibit C-10 (Continued)

Year'ended September 30, 2001 Fund Balances September 30, 2000 Revenues Exoenditures OperatIng Transfer In Operating Transfer Out Excess of Sources Over Uses Fund Balances September 30, 2001 Federally Qualfied Health Center Actual budget basis Budget,

Variance Fee Waiver Actual budget basis

Budget, Variance Health and Human Services Travis County Reimbursed Actual budget basi" Budget (D

V~rialn66 oJ Hotel-Motel Occupancy Tax Actual budget basis

Budget, Variance Municipal Court Building Security Actual budget basis Budget Variance Municipal Court Technology Actual budget basis Budget Variance Neighborhood Housing and Conservation Actual budget basis Budget Variance One Texas Center Actual budget basis-

Budget, Variance 548,129 488,947 59,182 22,588, (7,450) 30,038 (163,887) 187,831 (35i,718) 10,603,163 9,938,720 664,443 1,166 1,166 4,326,404 5,508,898 (1,182,494)'

18,370,658 16,919,151 (1,451,507) 22,481 22,481 4,351,789 5,508,898 1,157,109 31,144,551 28,925,000 2,219,551 212,454 51,082 161,372, 481,221

...96,843 384,378 1,982,670 1,503,731

_478,939 (361,776)

(334,670)

-'(27,166)'

475,264 448,290 26,974 593,104 442,864 150,240 123,237 96,483 26,754 2,222,959 2,237,021

" (14,062)'

1,641,990 1,562,994 2,007,462 1,643,051 365,472.

. (80,057) 2,416,538 2,416,538 8,650,018 8,650,018 763,252 763,252 119,271 906,335 (787,064) 1,166 (22,481) 23,647 (25,385)

(25,385) 667,400 1,395,282 (727,882) 23,754 (29,931) 53,685 (189,272) 187,831 (377,103)'

31,144,551 28,925,000 (2,219,551) 366,989 438,883 71,894 234,814 425,000 190,186 108,275 9,407 98,868.

358,290 17,864 340,426 (818,223)

(1,130,392) 312,169 (193,579)

(179,517)

(14,062) 862,464 862,464 320,729 60,489.

260,240 839,511 114,707 724,804" 1,164,447

-373,339 791,108 (555,355)

(514,187)

(4c,168)d (continued)

Revenues Exnenditures in S,, $

SPECIAL REVENUE FUNDS - OTHER COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND TRANSFERS BUDGET AND ACTUAL-BUDGET BASIS Year ended September 30, 2001 CITY OF AUSTIN, TEXAS Exhibit C-10 (Continued)

Fund Balances September 30, 2000 Revenues Expenditures Operating Transfer In Operating Transfer Out Excess of Sources Over Uses Fund Balances September 30, 2001 PARD Cultural Projects Actual budget basis Budget

'Variance PARD Police Asset Forfeiture Actual budget basis Budget Variance Police Federal Seized Funds Actual budget basis Budget..

Variance Police Seized Money Actual budget basis Budget Variance Public Improvement Districl Actual budget basis Budget Variance Strategic Planning Investment Actual budget basis Budget Variance Sustalnabihty Actual budget basis Budget Variance Telecommunity Partnership Actual budget basis Budget Variance 592,948 172,730 420,218 10,007 9,652 355 320,779 (288,416) 609,195 112,391 44,723 67,668 153,051 233,972 (80,921) 70,201 70,201 516 516 195,233 375,000 (179,767) 115,912 45,000 70,912 1,387,091 1,396,521 (9,430) 3,726,834 3,772,332 45,498 9,652 9,652 217,271 471,600 254,329 25,336 80,000 54,664 1,446,521 1,446,521 53,936 (650,000) 703,936 3,204,592 3,630,426 425,834 11,600 3,452 8,148 3,634,952 3,379,917 255,035 (21,681)

(392,415) 370,734 516 (9,652) 10,168 (22,038)

(96,600) 74,562 90,576 (35,000) 125,576 90,570 100,000 (9,430) 150,000 150,000 571,267 (219,685) 790,952 10,523 10,523 298,741 (385,016) 683,757 202,967 9,723 193,244 243,621 333,972 (90,351) 53,936 (650,000) 703,936 17,424,167 17,865,426 (441,259) 14,235,000 14,235,000 599 599 (15,425)

(15,425) 599 599 (15,425)

(15,425) 12,199 3,452 8,747 (continued)

SPECIAL REVENUE FUNDS - OTHER COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND TRANSFERS BUDGET AND ACTUAL-BUDGET BASIS CITY OF AUSTIN, TEXAS Exhibit C-10 (Continued)

Year ended September 30, 2001 Fund Balances September 30, Tourism and Promotion Actual budget basis Budget Variance Vehicle Rental Tax Actual budget basis Budget Variance Total Actual budget basis Budget Variance Operating Transfer Operating Transfer Excess of Sources Over Fund Balances September 30, 2000 Revenues Expenditures In Out Uses 2001 1,389,719 62,910 5,354,777 5,146,657 (145,210) 1,244,509 564,257 65,000 5,354,777 4,792,886 (496,891) 67,366 825,462 (2,090) 353,771 351,681 1,177,143 3,764,094 5,912,918 10,710,151 (4,797,233)

(1,033,139) 1,997,742 4,691,250 10,710,206 (6,018,956)

(4,021,214) 1,766,352 1,221,668 55 1,221,723 2,988,075 12,275,160 74,703,323 55,433,485 39,123,803 61,071,665 (2,678,024) 9,597,136 5,621,098 70,953,424 57,906,326 39,061,313 58,852,169 (6,743,758)

(1,122,660) 6,654,062 3,749,899 2,472,841 62,490 (2,219,496) 4,065,734 10,719,796 (0

Cn

96

-1

DEBT SERVICE FUNDS Debt service funds are used to account for the accumulation of resources for, and the payment of, general long-term debt.

The two debt service funds are as follows:

The General Obligation Debt Service Fund -

used for payments of principal, interest and related costs of general obligation and other tax-supported debt; The Section 108 Loans Fund - used to account for HUD loans for construction costs.

CITY OF AUSTIN, TEXAS

'Exhibit D-1 DEBT SERVICE FUNDS COMBINING BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 General ASSETS Cash SInvestments, at fair value Property taxes receivable Less allowance for uncollectible taxes

"-Net taxes receivable Due from other funds Total assets UABILmES AND FUND BALANCES

-,Uabilhbes:

-Deferred revenue Total ihabilibes '

Fund balances (unreserved)

Designated for debt service Total fund balances Total liabilities and fund balances HUD Section Totals Obligation 108 Loans 2001 2000 246 246 246 16,344,051 16,344.051 9,602,866 3.752.665 3.752,665 3.839,236 (680,655)

(680,655)

(688,939) 3,072,010 3,072,010 3,150,297 13,229 19,416,061 246 19,416,307 12,766,638

-2,949,177 -

2,949,177 3,009,934 2,949,177 2,949,177

-3,009,934 16,466,884' 246 16,467,130-9,756,704 16,466,884--1 246 16,467,130

. -9,756,704 19,416,061 246 19,416,307 12,766,638.

97

DEBT SERVICE FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CITY OF AUSTIN, TEXAS Exhibit D-2 REVENUES General property taxes Interest Other revenue Total revenues EXPENDITURES Principal retirement Interest and other Fees and commissions Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES)

Proceeds of refunding bonds Payment to escrow agent Operating transfers in Total other financing sourcing (uses)

Excess (deficiency) of revenues and other sources over expenditures and other uses Fund balances at beginning of year Fund balances at end of year General HUD Section Totals Obligation 108 Loans 2001 2000 68,639,520 68,639,520 64,960,513 2.216,053 2,216,053 2,545,511 326,371 559,398 885,769 620,439 71.181,944 559,398 71,741,342 68,126.463 44,070,106 480,000 44,550.106 27,220,117 29,839,635 441,862 30,281,497 42,450,477 13,962 13.962 10.105 73,923,703 921,862 74,845,565 69,680,699 (2,741,759)

(362,464)

(3,104,223)

(1,554,236) 110,563,444 110,563,444 (110,563,444)

(110,563,444) 9,452,185 362.464 9,814,649 3,441,226 9,452,185 362,464 9,814,649 3,441,226 6,710,426 6,710,426 1,886,990 9,756,458 246 9,756,704 7,869,714 16,466,884 246 16,467,130 9,756,704 98

DEBT SERVICE FUNDS CITY OF AUSTIN, TEXAS COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES Exhibit D-3 IN FUND BALANCES - BUDGET AND ACTUAL-BUDGET BASIS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 General Obligation Actual RI~dnet Variance Favorable Actual Budget HUD Section 108 Loans Variance Favorable REVENUES General property taxes Interest Other revenue Total revenues EXPENDITURES Principal retirement Interest and other SFees and commissions Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES)

Operating transfers In Total other financing sources (uses)

Excess (deficiency) of revenues and other sources over expenditures and other uses Fund balances at beginning of year Fund balances at end of year Basis Budget (Unfavorable)

Basis Budget (Unfavorable) 2001 2000 68,639,520 68,515,476 124,044 68.639,520 64,960,513 2,216,053 2,056,232 159,821 2,216,053 2,545,511 326,371 138,000 188,371 559,398 838,614 (279,216) 885,769 620,439 71,181,944 70,709,708 472,236

'559,398 838,614 (279,216) 71,741,342 68,126,463 50,333,885 47,643,885 (2,690,000) 480,000 480,000 50,813,885 33,555,625 32,286,338 35,948,222 3,661,884 441,862 721,078 279,216 32,728,200 45,522,371 13,962 10,000 (3,962) 13,962 10,105 82,634,185 83,602,107 967,922

-921,862 1,201,078 279,216 83,556,047 79,088,101 (11,452,241)

(12,892,399)

'1,440,158 (362,464)

(362,464)

(11,814,705)

(10,961,638) 18,162.667 11,902,100 6,260,567 362,464 362,464 18,525,131 12,848,628 18,162,667 11,902,100 6,260,567 362,464 362,464 18,525,131 12,848.628 6,710,426 (990,299) 7,700,725 6,710,426 1,886,990 9,756,458 9,350,509 405,949 246 246 9,756,704 7,869,714 16,466,884 8,360,210 8,106,674 246 246 16,467.130 9,756,704 Totals Actual-Budget Basis

100

CAPITAL PROJECTS FUNDS Capital projects funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities other than those financed by proprietary funds and trust funds. There are eight major groups of funds that account for the activities related to the capital improvement projects:

Prior to 1984: Funds authorized prior to 1981; Funds authorized August 29, 1981, for street and drainage, fire stations, traffic signals and emergency medical service projects; Funds authorized September 11, 1982, for various purposes; Funds authorized October 22, 1983, for Jollyville Road Improvements; 1984:

Funds authorized September 8, 1984, for various purposes; 1985:

Funds authorized January 19, 1985, for cultural arts; Funds authorized July 26, 1985, for parks and recreation; Funds authorized September 26, 1985, for art in public places; Funds authorized December 14, 1985, for various purposes; 1987:

Funds authorized September 3, 1987, for street improvements; 1992:

Funds authorized August 10, 1992, for various purposes; 1997.

Funds authorized May 3, 1997, for radio trunking; 1998:

Funds authorized November 3, 1998, for various purposes; and Other: Other funds established for various purposes.

C C

101

CITY OF AUSTIN, TEXAS Exhibit E-1 CAPITAL PROJECTS FUNDS COMBINING BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 Summary of Funds from General Obligation Bonds by Year of Authorization Prior to 1984 1984 1985 1987 1992 1997 1998 Other Totals Funds 2001 2000 ASSETS Pooled Investments and cash Accounts receivable Less allowance for doubtful accounts Net accounts receivable Due from other funds Other assets Total assets LIABILITIES AND FUND EQUITY Liabilities:

Accounts payable Due to other funds o

Other liabilities Total liabilities Fund balances:

Reserved for encumbrances Unreserved, undesignated Total fund balances Total liabilities and fund balances 979,088 9.930,108 512,638 512,638 82.006 504.329 5.193,017 54,298 413,634 7,345.422 29,389,470 31.049,772 43,816,300 166,953 24,419 30,490 1,816,828 (166,953) 24,419 30.490 1,816,828 72,989 2,419,473 4.864.660 426,114 127.703,177 2,551,328 (166,953) 2,384.375 7,997,755 839,748 127,975,159 2,329,942 (172,590) 2.157.352 16,751.044 931,536 1,061,094 10,947,075 5,660,949 7,442,830 29,419,960 33,469,245 50,923,902 138,925,055 147,815,091 1.040 263,100 33.578 237,528 1,367,877 2,320,788 2.848,634 7,072,545 8,281,892 82,006 504.329 54,298 72,989 2.419.473 4,861,000 7,994,095 16,747.159 311,303 618,112 929,415 2.738,334 83,046 767,429 344,881 54,298

, 310,517 1,367,877 4,740,261 8,327,746 15,996,055 27,767,385 37,104 2,099,283 163,959 1,000 1,175,647 29.102.712 18.464.438 28,167,747 79,211.890 49,155,286 940.944 8.080,363 5,152,109 (55,298) 5,956,666 (1,050,629) 10,264,546 14,428,409 43,717,110 70,892,420 978,048 10,179,646 5,316,068 (54,298) 7,132,313 28,052,083 28,728,984 42,596,156 122,929,000 120,047,706 1.061,094 10,947,075 5.660.949 7,442,830 29,419,960 33,469,245 50,923,902 138,925,055 147,815,091

CITY OF AUSTIN, TEXAS Exhibit E-2 CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND`

CHANGES IN FUND BALANCES Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 Summary of Funds from General Obligation Bonds I

bv Year of Authorization REVENUES I

Intergovernmental revenues Property owners' participation and contnbutions Interest and other, Total revenues EXPENDITURES Capital outlay for construction Deficiency of reve'nues over expenditures OTHER FINANCING: SOURCES (USES Proceeds from Issuance of tax oD supported debt' Operating transfers In Operating transfers out Total other financing sources (uses)

Excess (deficiency) of revenues and other sources over expenditures and other uses Fund balances at beginning of year Residual equity transfers In(out)

Fund balances at end of year Other Totals Prior to 1984

1984, 1985 1987 1992 1997 1998 Funds 2001 2000 725,381 8,235,846 -

8,961,227 9,169,519 100,000 (106,141) 995,023 7,502 (4,088) 7,072,252 3,375,280 11,439,828 9,508,185 463,629 (188,905) 162,644 11,526,600 11,963,968 16.783,236.

100,000 (106,141) 1,458,652 (181,403) 883,937 7,072,252 23,137,726 32,365,023 35,460,940;Z 375,215 12,018,153 282,158 86,393 7,138,500 9,650,243 35,931,422 39,941,504 105,423,588 99,863,556 (275.215)

(12,124,294) 1,176,494 (267,796)

(6,254,563)

(2,577,991)

(35,931,422)

(16,803,778)

(73,058,565)

(64,402,616)

,-i 1,000,000 51,930,000 6,060,000

" 58,990,000 59,330,000 100,000 1,831,773 39,922,576 41,854,349 31,991,956 (6,657,510)

(18,246,980)

(24,904,490)'

(13,649,158) 100,000 (6,657,510) 1.000,000 1,831.773 51,930,000 27,735,596 75,939,859 77.672,798 (175,215)

(12,124,294)

(5,481,016)

(267,796)

(5,254,563)

(746,218) 15,998,578 10,931,818 2,881,294 13,270,182:

1.153,263 22,303,940 10.797,084' 213,498 13,136,795k 28,798,301 12,730,406 30,914,419 120,047,706 106,777,524 (749.919) 749,919 978,048 10,179,646 5,316,068 (54,298) 7,132,313 28.052,083 28,728,984 42,596,156 122,929,000 120,047,706

CAPITAL PROJECTS FUNDS COMBINING BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 Funds Authorized Prior to 1981 Parks and recreation Police and courts Street improvements Library Health centers Funds Authorized August 29, 1981 Street and drainage Fire stations EMS buildings Funds Authorized September 11, 1982 Street and drainage Flood prevention Public works parking Traffic signals Parks-vanous Environmental resources Fire/EMS building Funds Authorized October 22, 1983 Jollyville road improvements Energy improvements - city facilities Total Prior to 1984 Funds Authorized September 8,1984 Zilker land acquisition PARD pools Parkland acquisition Parks/Old Bakery Drainage and flood improvements Street improvements Fire improvements Libraries Police facilities Traffic signals EMS/Fire facility Assets Pooled Allowance Net Investments Accounts for Doubtful Accounts Due from Other Total and Cash Receivable Accounts Receivable Other Funds Assets Assets 176,770 176,770 2,469 2.469 56,675 56,675 7,274 7,274 9,190 9,190 252,378 252,378 2,989 2.989 24,184 24.184 329,117 329.117 356.290 356.290 14 14 128,488 128,488 169,440 82,006 251,446

'2,462 2,462 43,259 43,259 343,663 82,006 425,669 26,757 26,757 26.757 26,757 979,088 82.006 1,061,094 4,856 4,856 383,883 383,883 3,213,079 3,213,079 6,303,578 512,638 512.638 504,329 7,320,545 10,847 10,847 841 841 9,495 9,495 3,529 3,529 9,930,108 512.638 512,638 504,329 10,947,075 104

CITY OF AUSTIN, TEXAS Exhibit E-3 Liabilities Fund Balances Total Unreserved, Total Uabilitles Accounts Due to Other Total iReserved for Undesignated Fund and Fund Payable Other Funds Liabilities IUlabilitles Encumbrances (Deficit)

Balances Balances 176,770 2,469 56,675 7,274 9,190 252.378 1.040 1.040 12,204 12.204 2,989 24,184 315,873 343.046 176,770 2,469 56,675 7,274 9,190 252,378 176,770 2,469 56,675 7,274 9,190 252,378 2,989

-2,989 24.184 24,184 328,077 329,117 355.250 356,290 19,900 14 128,488 231,546 2,462 43.259 14

' 14 128,488 128,488 251,446 251,446 2.462 12,462 43,259 43,259

-19,900 405,769 425,669

'425,669 26,757 26,757 26,757 82,006 82,006 5,000 (87,006)

(82,006) 82,006 82,006 5,000 (60,249)

(55,249) 26,757 1,040 82,006 83,046 37,104 940,944 978,048 1,061,094 490,544 490,544 263,100 _

263,100 13,785 13,785 6,413 229,103 1,863,253 514

"-4.856

-" 383,883 (496,957) 2,983,976 5,194,192 10,847 841 (13,785) 9,495 3.015 4,856 4,856 383,883 383,883 (490,544) 3,213,079 3,213,079 7,057,445 7,320,545 10,847 10,847 841 841 (13,785) 9,495 9,495 3,529 3,529 -

105 r

1,040 lflt41l 263,100 -..-- 504,329 -

767,429 2,099,283

-8,080,363-10,179,646 10,947.075' (continued) 1040 1040 12204 f

CAPITAL PROJECTS FUNDS COMBINING BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 Assets Pooled Allowance Net Investments Accounts for Doubtful Accounts Due from Other Total and Cash Receivable Accounts Receivable Other Funds Assets Assets Funds Authorized January 19, 1985 Cultural arts 1,407.957 413,634 1.821,591 Downtown art museum 168.363 168,363 1,576,320 413,634 1,989,954 Funds Authorized July 26, 1985 Neighborhood park and recreation 3,576.619 54,298 3,630,917 Funds Authorized September 26, 1985 Art in pubfic places 107 107 Funds Authorized December 14,1985 Senior activity center 13,135 13,135 South Austin parkland 10.903 10,903 Parks Oak Hill 15.933 15,933 39.971 39,971 Total Funds Authorized In 1985 5,193,017 54,298 413.634 5,660,949 Funds Authorized September 3, 1987 Street resurfacing 166,953 (166,953)

Funds Authorized August 10, 1992 EMS facility 49,357 49,357 Fire stations 33,441 33,441 Police substations Asbestos abatement/ADA compliance/

East Austin health clinic 1,572.178 72,989 1,645,167 Erosion & flood control 4,099,220 24,419 24.419 4,123,639 Street & traffic signals 490,446 490.446 Neighborhood sidewalks 91,538 91,538 Parks and recreation facilities 601.999 601,999 Libraries 57,954 57.954 Balcones Canyonlands Conservation Plan 24,361 24,361 Barton Creek greenway 324,928 324.928 7,345.422 24,419 24,419 72,989 7,442.830 Funds Authorized May 3, 1997 Radio Trunking 29,389.470 30,490 30,490 29.419,960

$ 29,389.470 30,490 30,490 29.419,960 106 I-

CITY OF AUSTIN, TEXAS Exhibit E-3 -'

(Continued)

Liabilities Accounts Due to Payable Other Funds Other Total Reserved for Liabilities Liabilities Encumbrances 28,775 28,775 1.961,179 1.989,954 1,989,954 21,103 311.303 332,406 124,459

-- 3,174,052- -

3,298,511 3,630,917 10.725 (10,618)

• 13,135 10.903

• 3.458 j

475 107 13,135 10,903 3.458 107 13,1353,

_10,903*

15.933 12,475 12,475 27,496 27,496 39,971 311,303 344,881 163,959 5,152,109 5,316,068 5,660,949,

54.298 54.298 1.000 (55,298)

(54,298) 253,964 44,515 1

10,322 1,715 6,458 329,570 272,104 "194,159 103,373

- 26,741 "206,545 36,697

'49,357 "26,983 (583,534) 1,328,548

-3,929,480 387,072 64,797 385,132 19,542 49,357 33.441 (253,964) 1.600,652 4,123,639 490,445 91,538.

591,677 56,239 49,357,,

33,441

-1,645,167.

4,123,639 490,446

" 91,538 601,999 57,954 "24,361 24,361 24,361 324,928 324,928 324,928 237,528 72.989 310,517 1,175,647 5,956,666 7,132,313 7,442,830 S1,367,877 1,367.877 29,102.712 (1.050,629) 28,052,083 29,419,960 1.367.877 1,367,877 29,102,712

( (1,050,629) 28,052,083 29,419,960 (contnued) 107 Fund Balances Unreserved, Undesignated (Deficit) 1,792,816 S168.363 Total Fund Balances 1.821,591 168.363 Total Liabilities and Fund Balances 1,821.591 S168.363 V3 40 A7r

,!, F 33,578 72,989 180.975 44,515 1

10.322 1,715 Liabilities I

I 54298 t

CAPITAL PROJECTS' FUNDS COMBINING BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 Funds Authorized November 3, 1998 Cultural arts and land Drainage and flood control Traffic signals Public safety FAC Parks and recreation facilities Other funds Planning & development improvements TPSD general improvements Parks-1992 Ubrary automation system Fire/EMSINW Austin MUD #1 General government projects Health projects Build Austin CMTA Mobility Forsythia Drive Central City Entertainment Center Park improvements Police and courts Health centers Neighborhood centers Loan star improvements Fire - general Capital reserve Library Public Works One Texas Center Watershed Protection Tanglewood park Great Streets City Hall. plaza, parking garage Conservation Land Colony Park Interest income fund Total other funds 2001 Totals Prior year totals Funds authorized:

Prior to 1984 September 8, 1984 1985 September 3, 1987 August 10, 1992 1997 1998 Other funds 2000 Totals Assets Pooled Allowance Net Investments Accounts for Doubtful Accounts Due from Other Total and Cash Receivable Accounts Receivable Other Funds Assets Assets 6,667,090 6,667,090 5,231,058 5,231,058 12,498,040 2,419,473 14,917,513 6,653,584 6,653,584 31.049,772 2,419,473 33,469,245 750,088 15,947,888 373,498 444,175 589.049 7,963,456 522,669 3,128 27,132 4,025,630 836,273 17,301 8,265 330,704 6,086,053 3,390,383 5,768 186.684 723,857 629,747 954,552 43,816,300 10,639 705,479 1,100,710 1,816.828 10,639 705,479 1,100,710 1.816,828 4,861,000 3,660 4,864.660 426,114 750,088 15,958,527 373,498 444,175 589,049 7,963,456 522,669 705,479 3,128 27.132 4,025,630 836,273 17,301 8,265 330,704 6,086,053 9.352,093 5,768 186,684 1,149,971 629,747 3,660 954,552 426,114 50,923,902 127,703,177 2,551,328 (166,953) 2,384,375 7,997,755 839,748 138,925.055 1,305,932 92,542 34,105 1.432,579 22,094,794 512.638 512.638 421,946 9.837 23,039,215 10,568,010 420,063 10.988,073 248.168 365,821 (172,590) 193,231 441,399 13,879,026 3,885 41.417 13,924,328 28,798,301 28,798,301 14,675,386 8,661,570 23,336,956 36,405,542 1,451,483 1,451,483 7,571,101 426,114 45,854,240

$ 127,975,159 2.329,942 (172,590) 2.157,352 16,751,044 931,536 147,815,091 108

CITY OF AUSTIN, TEXAS

.'Exhibit E-3 (Continued)

S.

FundBalances---

Total Unreserved, Total Liabilities Accounts Due to Other Total Reserved for Undesignated Fund and Fund Payable Other Funds Liabilities Liabilities

'Encumbrances (Deficit)

Balances Balances 134,929 94,150 1,977,813 2,419,473 28.233 85,663 2,320.788 2,419,473 134,929 94,150 4,397,286 28,233 85,663 4,740,261 1,393,109 5,139,052 6,532,161 6,667,090 688,889 4,448,019 5,136,908 5,231,058 5,706,783 (10,104,069)

(4,397,286) 7,641,255 7,248,025 14,889,280 14,917,513 3,034.402 3,533,519 6,567,921 6,653,584 18.464A38 10.264.546 28,728,984 33,469,245 171,242 66,269 297,058 9,513 50,543 769,698 41,198 207,076 8,523 632 13,115 282,828

-' 10,471 95,976 641,980 64,197 1,255,262 3,705,949 6,595 11,509 2.848.634 4.861.000 412,006 2,402 1,616 202,088 618.112 7.072.545 7.994.095 -.

929.415 4,412 745,676 750,088 750,088 171,242 3,533,785 12,253,500 15,787,285 15,958,527 66,269 217,192 90,037 307,229

,373,498 296,203 147,972 444,175 444,175 589,049 589,049 589,049 709,064 1,637,941 5,616,451 7.254,392 7,963,456 9.513 47,918 465,238 513,156 522,669 820,241 188,198 (302,960)

(114,762) 705,479 248,274 1,712,423 (1,960,697)

(248.274) 3,128 3,128 3,128 2,402 438 24,292 24,730 27,132 8,523 402,542 3,614,565 4,017,107 4,025,630 632 27,143 808,498 835,641 836,273 451 16,850 17,301 17,301 8,265 8,265 8,265 13,750 316,954 330,704 330,704

'13,115 143,523--

5,929.415 6,072,938 6,086,053 282,828 15,364,209 (6,294,944) 9,069,265

,: 9,352,093 5,768 5,768 5,768 106,447 144,422 (250,869)

(106,447) 1,731 184,953 186,684 186,684 641,980 449,806 58,185 507,991

-1,149,971 64,197 (64,197)

(64,197) 629,747 629,747 629,747 4,961,211 3,981,660 (8,942,871)

(4,961.211) 8,211 (4,551)

(4,551) 3,660 11,509 (11,509)

(11,509) 202,088 752.464 752,464 954,552 8,327,746 28,167.747 14,428.409 42,596,156 50,923.902 15,996,055 79,211,890 43,717,110 122,929,000 138,925,055 109,124 170,192 279,316 307,552 845,711 1,153,263 1,432,579 390,979 344,296 735,275 11,055,579 11,248,361 22,303,940 23,039,215 8,612 182,377 190,989.

73,913 10,723,171 10,797,084 10,988,073 227,877 24 227,901 1,000 212,498 213,498

, 441,399 785,692 1,841 787,533 4,301,700 8.835,095 13,136.795 13,924,328 43,764 28,754,537 28,798,301 28,798,301

",1,944,980 8,661,570 10,606.550 20,095,751 (7,365,345) 12,730,406 23,336.956 4,814,628 7,571,101 2,554,092" 14,939,821.

13,276.027..

17.638,392 30.914,419 45,854.240 8,281,892 16,747,159 2,738,334 27,767,385 49,155,286 70,892,420 120,047,706 147,815,091 109 S.......

Liabilities

CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 Revenues Expenditures Property Owners' Inter-Participation Interest governmental and and Total Capital Revenues Contributions Other Revenues Outlay Funds Authorized Prior to 1981 Parks and recreation Police and courts Street improvements Library Health centers Funds Authorized August 29, 1981 Street and drainage Fire stations EMS buildings Funds Authorized September 11, 1982 Street and drainage Flood prevention Public works parking Traffic signals Parks-various Environmental resources Fire/EMS building Funds Authorized October 22, 1983 Jollyville road Improvements Energy improvements - city facilities Total Prior to 1984 Funds Authorized September 8, 1984 Zilker land acquisition PARD pools Parkland acquisition Parks/Old Bakery Drainage and flood improvements Street improvements Fire Improvements Ubraries Police facilities Traffic signals EMS/Fire facility Funds Authorized January 19, 1985 Cultural arts Downtown art museum 100,000 838 184 100,000 100,000 100,000 1,022 604 339.230 339.834 (529) 1 4

29,729 29,205 5,154 5,154 100.000 100,000 375.215 9

160,033 315,047 (106.141)

(106.141) 11,543,064 (106,141)

(106.141) 12,018,153 463,629 463.629 28,610 463,629 463.629 28,610 110

.CITY OF AUSTIN, TEXAS Exhibit E-4

+I Excess

-Other Financing Sources (Uses)

(Deficiency) of Revenues Issuance Total and Other Fund Residual Fund of Tax Operating Operating Other Sources over Balances Equity Balances Supported Transfers Transfers Financing Expenditures September 30, Transfers September 30,

Debt, In Out Sources(Uses) and Other Uses

`2000 In (Out) 2001 (838) 177,608 176,T70 2,469 2,469 56,675 56,675 99,816 (92,542) 7,274 9,190 9,190 98,978 153,400 252,378 2,989 2,989

-(604) 24,788

'24,184" 100.000 100,000 (239,230).

567,307 328,077 100,000 100,000 (239,834) 595,084 355,250 14

-14' S

529 127,959 128,488 (1) 1 r

(4) 4 (29,729) 281,175 251,446 S.....

2,462 2,462 43,259 43,259 (29,205) 454,874 425,669 26,757 26,757 (5,154)

(76,852)

(82,006)

(5,154)

(50,095)

(55,249) 100,000 100,000 (175,215) 1,153,263 978,048 (9) 9 4,856 4,856 383,883

• 383,883

-(160,033)

(330,511)

(490,544),

(315,047) --..

3,528,126 3,213,079 (11,649,205) 18,706,650 7,057,445

+, t 10,847 10,847 10,84 841 841 (13,785)

'(13,785)

S-9,495 9,495 3,529 3,529 S....-

(12,124,294) 22,303,940 10,179,646 (461,863)

(461,863)

(26,844) 1,848,435 1,821,591 (6,195,647)

(6,195,647)

(6,195,647) 6,364,010 168,363 (6,657,510)

(6,657,510)

(6,222,491) 8,212,445 1.989,954 (continued)

.111

CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 Revenues Expenditures Property Own ers' Inter-Participation -

Interest governmental and and Total Capital Revenues Contributions Other Revenues Outlay Funds Authorized July 26,1985 Neighborhood park and recreation Funds Authorized September 26, 1985 Art in public places Funds Authorized December 14, 1985 Senior activity center South Austin parkland Parks Oak Hill Total funds authorized In 1985 Funds Authorized September 3, 1987 Street resurfacing Funds Authorized August 10, 1992 EMS facility Fire stations Police substations Asbestos abatement/ADA compliance/

East Austin health clinic Erosion & flood control Street & traffic signals Neighborhood sidewalks Parks and recreation facilities Libraries Balcones Canyonlands Conservation Plan Barton Creek greenway Funds Authorized May 3, 1997 Radio Trunking Funds Authorized November 3, 1998 Cultural arts and land Drainage and flood control Traffic signals Public safety FAC Parks and recreation facilities 995,023 995,023 189.485 8,225 55,838 55,838 995,023 463,629 1,458,652 282,158 7.502 (188,905)

(181,403) 86,393 40,505 2,743.405 305,113 305,113 1,830,391 1,162,078 (144,513)

(144,513) 416,756 813 725,381 725,381 786,156 142,741 (4,088) 2,044 (2,044) 15,655 725,381 (4,088) 162,644 883,937 7,138,500 7,072.252 7,072,252 9,650,243 7,072,252 7,072,252 9,650,243 1,871,368 1.983,956 20,780,807 4,879.114 6,416,177 35,931,422 112

CITY )F AUSTIN, TEXAS Exhibit E-4 (Continued)/

Excess Other Financing Sources (Uses)

(Deficiency) of Revenues Issuance Total and Other Fund Residual Fund of Tax Operating Operating,

Other Sources over Balances Equity Balances Supported Transfers Transfers

• Financing Expenditures September30, Transfers September 30, Debt In Out

"'Sources(Uses) and Other Uses

-2000 In (Out) 2001 805.538 2.492,973 3,298,511--

(8,225) 8,332 107 13,135 13,135 10,903

'ý10,903 S....

(55,838) 59,296 3,458 (55,838) 83,334

-27,496 (6.657,510)

(6,657,510)

(5,481,016) 10,797,084 5,316,068 (267,796) 213.498 (54.298)

,1,000,000 1,000,000 7..

(40,505)

(2,743,405)

(525,278)

(1,162,078)

(561,269)

(813)

.- (60,775)

(142,741)

"(17,699) 49,357 73,946 2,489,441 2,125,930 5,285,717 1,051,714 92,351

-652,452

- 198,980 791,979

'I'A A'nO

'49,357 33,441 (253,964)

(749,919) 1,600,652 4,123.639

'490,445 91,538 591,677 '"'

56,239'-* zT 24,361

'A'9A GIA 1,000.000 1,000,000 (5,254,563) 13,136,795 (749,919) 7,132,313 1,831,773 1,831,773 (746,218) 28,798,301 28,052,083 1,831,773 1,831,773 (746,218) 28,798,301 28,052,083 5,745,000 5,745,000 3,873,632 2,658,529 6,532,161 (1,983,956),

7,120,864 5,136,908

-26,345,000 26.345,000

-'5,564,193, (9,961,479)

(4,397,286) 12,930,000 12,930,000

- 8,050,886 --'

---6,838,394 14,889,280 6,910,000 6,910,000 493,823 6,074,098 6,567,921 51,930.000 51,930,000 15,998,578 12,730,406 28,728.984 (conbnued) 113

CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 Revenues Expenditures Property Owners' Inter-Participation Interest governmental and and Total Capital Revenues Contributions Other Revenues Outlay Other funds Planning & development Improvements TPSD general improvements Parks project 1992 Library automation system Fire/EMS/NW Austin MUD #1 General government projects Health projects Build Austin CMTA Mobility Forsythia Dnve Central City Entertainment Center Park improvements Police and courts Health centers Neighborhood centers Loan star improvements Fire : general Capital reserve Ubrary Public Works One Texas Center Watershed Protection Tanglewood park Great Streets City Hall, plaza, parking garage Conservation Land Colony Park Interest income fund Total other funds 2001 Totals Prior year totals Funds authorized:

Prior to 1964 September 8, 1964 1985 September 3, 1987 August 10, 1992 1997 1998 Other funds 2000 Totals 650,541 23,272 209,518 4,404 3.690,918 19,6 378,8 1

1,598,011 1,744,928 2,800,000 8,235,846 887,490 2,044 3,375,280 2.4 (55.1 4,21 11,176,41 11,526,6 650,541 23,272 55 229,173 16-383,220 3,690,918 53 153 1,598,011 1,744,928 887,490 23 2,423

13)

(55,113) 05 6,249 2,800,000 61 11,176,461 20 23,137,726 10,626,742 234,988 275,719 3,160,509 297,119 2.925,798 248,274 53,878 1,035,081 123,156 101,832 198,072 5,192,764 1,725,054 13,063 917,103 9,990,043 10,800 2,811,509 39,941.504 8.961,227 11,439,828 11,963.968 32.365,023 105,423,588 856,185 2.000,000 2,000,000 10,169,329 738,521 440,814 1,179,335 374,470 22,520 22,520 239,406 197,615 79,486 277,101 13,432,013 (34,692) 24,321,332 8,971,904 6,769,664 16,240.416 31.981,984 50,505,513 9,169.519 9,508,185 16,783,236 35,460,940 99,863,556 114

CITY OF AUSTIN, TEXAS Exhibit E-4 (Continued)

Excess Other Financing Sources (Uses)

(Deficiency) of Revenues Issuance Total and Other Fund Residual Fund of Tax Operating Operating Other Sources over Balances Equity Balances Supported Transfers Transfers Financing Expenditures September 30, Transfers September 30, Debt In Out Sources(Uses) and Other Uses 2000 In (Out) 2001 19,022,000 373,000 7,163,404 (6,824,576) 160,000 4,155,580 3,675,000 (1,763,404) 2,484,374 (1,000,000) 2,160,000 2,116,329 311,026 3,900,000 461,863 (8,659,000)

R lf nnn

'4N RQ9 7R (19 94R 9RO*

19,022,000 373,000 338,828 160,000 4,155.580 1,911,596 1,484,374 4,276,329 311,026 3,900,000 (8,197,137) 750,088 9,045,799 6,741,486 (234,988) 542,217 120,553 323,622 229,173 359,876 (2,438.461) 9,692,853 (137,119) 650,275 765,120 (879.882)

(248,274) 153 2,975 (53,878) 78,608 3,120,499 896,608 (123,156) 958,797 (101,832) 119,133 8,265 330,704 1,713,524 4,359,414 (2,110,379) 11,179,644 53768 19,874 (126,321)

(13,063) 199,747 4,246,716 (3,738,725)

(64,197) 313,449 316,298 (10,045,156) 5,083,945

'!3.895,449 (4.649,919)

(11,509) 2,979,324 (2,226,860) 10.931.818.

30.914.419 58.990,000 41,854.349 (24,904,490) 75.939.859 2,881.294 120,047,706 122,929,000 38,576 38,576 (817,609) 1,970,872 1,153,263 (8,169,329) 30,473.269 22,303,940 174,000 (1,142,428)

(968,428)

(163,563) 10,960,647 10,797,084 (216,886) 430,384 213,498 4,690,000 1,150.000 5,840,000 (7,314,912) 20.451,707 13,136,795 6,720,000 6,720,000 6,754,692 22,043,609 28,798,301 42.390,000 42,390,000 18,068,668 (5,338,262) 12,730,406 5.530,000 30,629,380 (12.506,730) 23,652,650 5,129,121 25,785,298 30,914,419 59.330,000 31,991,956 (13.649.158) 77,672,798 13,270.182 106,777,524 120,047,706 115 750,088 15,787,285 307,229 444,175 589,049 7,254,392 513,156 (114,762)

(248,274) 3.128 24,730 4,017,107 835.641 17,301 8,265 330,704 6,072,938 9,069,265 5,768 (106,447) 186,684 507,991 (64,197) 629,747 (4,961,211)

(4,551)

(11,509) 752,464 42.596,156 749,919 749.919

116

ENTERPRISE FUNDS Enterprise funds account for the acquisition, operations and maintenance of the City's facilities and services that are entirely or predominantly supported by user charges or those for which the City has decided that periodic determination of the revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public

policy, management control, accountability or other purposes.

All activities necessary to provide services are accounted for in these funds, including, but not limited to, administration, operations, and maintenance.

Debt service for the Electric Fund, the Water and Wastewater Fund, the Solid Waste Services Fund, the Airport Fund, and the Convention Center Fund is also included. The enterprise funds are as follows:

The Electric Fund; The Water and Wastewater Fund; The Hospital Fund, The Solid Waste Services Fund; The Airport Fund; The Convention Center Fund; The Drainage Fund; The Transportation Fund; The Golf Fund; and The Parks and Recreation Fund

U',

117 I I P

't,

ENTERPRISE FUNDS COMBINING BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 Water and ASSETS Current assets:

Cash Pooled investments and cash Working capital advances Accounts receivable Less allowance for doubtful accounts Net accounts receivable Receivable from other governments Due from other funds Inventories, at cost Prepaid expenses and other assets Total current assets Restricted assets:

Revenue note current debt service account Revenue bond current debt service account Revenue bond future debt service account Revenue bond retirement reserve account Construction account Due from other funds Advances to other funds Decommissioning account Capital improvement account Operating reserve account Hotel occupancy tax account Renewal and replacement account Investments and cash held by trustee Nuclear fuel inventory acquisition account Mueller disposition account Customer and escrow deposits Other restricted accounts Total restricted assets Fixed assets, at cost:

Property, plant and equipment in service Less accumulated depredation Net property, plant and equipment in service Construction in progress Nuclear fuel, net of amortization Plant held for future use Net property, plant and equipment Investment in municipal utlity districts Intangible assets, net of amortization Other long-term assets Deferred costs and expenses, Including bond issue cost, net of amortization Total assets See accompanying independent auditors' report.

Solid Waste Electric Wastewater Hospital Services 17,000 12,450 2,550 56,571,935 11,904,032 35,173,831 2,389,996 2,890.794 103,809,396 22,912,691 3.675,901 4,516,165 (4,310,094)

(994,716)

(3,389,316)

(132,627) 99,499,302 21,917,975 286,585 4,383,538 150,000 47,649,254 1,078,454 27,665,645 20,448 234,443,930 34,912,911 35,460,416 6,796,532 81,116,278 35,634,023 192,196,078 116,568,219 54,131,600 67,543,721 99,448,693 9,217,149 26,872 241,850 72,591,362 5,213,934 31,898,253 4,073,789 2,137,203 170,800 2,060,156 568,047,856 196,834,175 9,387,949 2,823,080,198 2,095,315,953 74,793,203 52,979,101 (1,131,860,735)

(592,992,200) (33,753,688) (22,483,056) 1,691,219,463 1,502,323,753 41,039,515 30,496,045 193,752,698 155,017,516 12,722,470 19,438,007 31,378,983 1,935,789,151 1,657,341,269 41,039,515 43,218,515 1,756,084 95,101,582 3,969,980 375.938,961 237,825,191 39,772

$3,118,189,878 2,223,771,212 76,499,931 59,442,768 118

CITY OF AUSTIN, TEXAS Exhibit F-1 I V Convention Airport Center Drainage Transportation Golf 7,500

. 2,000 700 5,012,442 17,981,848 1,230,766 123,841 4,783,960 363,618 2,615,113 (150,000)

(1,024)

(97,156)

'800

,2,749,555 1,575,880 (176,772) 1,300 651,968 44,300 42,050 190,825 133,857,198 80,318,516 3,014,635, 2,548,202 144,252,724 167,850,654 (9,251,705)

(9,163,184) 4,633,960 362,594 2,517,957 1,399,108 135,001,019 158,687,470 698,954 150,000 263,723 48,991,431 46,401,728

-.1,200 43,500 67.230 27,798,023 64,184,961 9,655.102 18,513,783 3,816,653 4,413,186 653,268 190,825 348,856,606 352,881,881 392,997 11,390,843 5,948,142 6,914,551 27,241,407 94,096,467 26,321,922 4,318,000 34,547,866 6,900,950 572,788 10,000,000 1,063,999 5,778,587 196,301--

747,219 12,093,434 112,860,385 109,343,166 26,321,922 26,405 1,136,641 26.405 1.136,641 392,997 441,867 134,089V86 118,709,645 192,196,078 221,753,105 177,614,370 168,178,520 325,032,405 374,192,036 S- -

26,872 384,424 4,559,850 4,586,722 72,591,362 63,515,224 34,547,866 15,485,262 6.900,950 17,509,286 572,788 2,076,499 11,063,999 11,043,578 5,213,934 20,393,686 31,898,253 33,473,935 5,778,587.

2,616,040 7,325,312 12,199,305 14,153,590

,10,156,981 1,023,958,499 1,076,716,115 724,642,522 114,992,716 28,705,631 10,070.022 12,913,309 173,018 5,937,665,673 5,630,759,243 (126,437,598)

(24,598,883)

(4,707,994)

(4,259.138)

(3,628.130)

(53,173) (1,944,774,595)

(1,797,068,649) 598,204,924 90,393,833 23,997,637 5,810,884 9,285,179 119,845 3,992,891,078 3,833,690,594 10,403,624 109,054,206 23,631,480 1,573,647 506,155,641 354,580,793 19,438,007 17,862,325 31,378,983 31,378,983 608,608,548 199,448,039 47,629,117 5,810,884 10,858,826 119,845 4,549,863,709 4,237,512,695 1,756,084 2,107,665 95,101,582 97,500,000 3,969,980 1,326,942 2,295,702 18,662,165 5,974 1,129 20,906 634,789,800 641,812,260 733.419,737 345,967,153 77,773,666 10,251,604 12,669,641 310,670 6,658,296,260 6,409,857,558 (continued) 119 Parks and Recreation Totals 2001 2000

ENTERPRISE FUNDS COMBINING BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 Water and Electric Wastewater Solid Waste Hospital Services LIABIUTIES AND FUND EQUITY Current liabilities:

Accounts payable Accrued payroll Accrued compensated absences Construction contracts payable Contract revenue bonds payable Due to other funds Interest payable on other debt Deferred revenue General obligation bonds payable and other tax supported debt Water improvement district bonds payable Capital lease obligations payable Other liabilities Total current liabilities Liabilities payable from restricted assets:

Accounts and retainage payable Accrued interest payable General obligation bonds payable and other tax supported debt Revenue bonds payable within one year Capital lease obligations payable Customer deposits Escrow deposits Decommissioning expense payable Nuclear fuel expense payable Other liabilities Total liabilities payable from restricted assets See accompanying independent auditors' report.

60,116,489 1,811,695 4,967,011 1,004,687 1,436,614 5,198,430 1,221,671 1.070,686 2,861,904 204,041 6,605,000 4,029,558 959,058 250,000 850,000 1,066,943 35,554 3,109 2.105 19,873 565,580 361,718 895,528 113,938 1,962,116 175,153 74,534,926 19,118,861 60,641 4,074,033 18,023,476 11M752,863 425,232 34,686,964 22,553,515 336,624 4,709,229 80,449,446 18,426,216 2,504,419 889,034 170,800 1,569,370 1,248,169 72,591,362 31,898,253

$ 242,059,914 59,579,026 596,032 120

CITY OF AUSTIN, TEXAS, Exhibit F-1 i,,_ -(Continued),,

Convention Parks and Totals Airport Center

'Drainage Transportation Golf Recreation 2001 2000 6,882,391 447.032 265,164

-681,130 73,538 60,446 70,348,995

.74,328,647 350,862 133.092

-266,640 166,567 58,812 37,591 4,260,772 3,411,366 852,867 295,941 480,684 386,075 117,971 28,132-10,888,218

.11,409,500 204,041.-,.

1,074,032 S......

6,605,000 6,930,000

-* 30,825 8,341 11,141 8,176 34,490 5,210,331 6,301,865

'380,433 1,359,364 1,386,130 132,009 55,766 187,477 116,934 499,305 2,953,607 2,700,523 250,000 n 366,000--,

2,286,614 2,100,001 13,728 49,970 6,504,224 5,909,229 8,620,631 981,801 1,211,106 1,358,882 784,116 126,169

,110,871,166

,-115,948,118 1,684,794

--1 3, 943,756 810,897 5,836 46,646,854 40,191,049 8,586,936

-"5.196,8ý40 71,024,255 62,027,168 S..........

5,045,853 3,688,803 3,255,000

-3,090,000 105,220,662 104,302,365 I.

, 7,500,000

- 196,301 747,219 212,380

,4,720,153

.3,803,624 2,817,539

-:3,608,061, 72,591,362 63,515,224, S.......

31,898,253

. 33,473,935

-3,432,722 3,432,722

-, 4,542,323 17,155,753

--22.977,815 1,023,277 5,836 343,397,653 326,652.552

• cnunueU) 121 J

f

ENTERPRISE FUNDS.,

)

COMBINING BALANCE SHEET September 30, 2001 With comparative totals for September 30, 2000 Water and Electric Wastewater Solid Waste Hospital Services LUABILITIES AND FUND EQUITY, CONTINUED Long-term liabilities:

Accrued compensated absences payable Constru~tion contracts payable Contract revenue bonds payable, net of discount Capidal appreciation bond interest payable Commercial paper notes payable Revenue notes payable General obligation bonds payable and other tax supported debt, net of discount and inclusive of premium Revenue bonds payable, net of discount and inclusive of premium Water improvement district bonds payable Capital lease obligations payable Decommissioning assessment payable Accrued landfill closure and postclosure costs Deferred revenue and other liabilities Total long-term liabilities Total liabilities Fund equity Contributions from municipality Contributions from State and Federal govemments Contributions in aid of construction Contributions from the private sector Total contributions Retained earnings:

Reserved for renewal and replacement Reserved for passenger facility charge Unreserved Totalretained eamings Total fund equity Total liabilities and fund equity See accompanying independent auditors! report.

4,282,537 91,208,535 150,242,720 1,848,301 75.000 69,858,104 53,852,283 78,226,000 2,729,710 30,080,275 1,425,918,901 10,036,520 1,703,648 3,366,279 1,689,488,850 2,006,083,690 1,102,148,563 6.600.000 34,952,501 1,377,641,027 1.456,338,914 209,538 17,356,515 60,641 6,904,024 24,470.077 29,140.142 3,562,708 2,797,496 9,097,495 1,372,233 670,509 27,460,799 874,135 57,497,527 306,422,539 3,686,908 61,730,744 336,680,834 13,658,538 1,372,233 1,050,375.444 430,751,464 62,780,752 28,930,393 1,050,375,444 430.751,464 62.780,752 28.930,393 1,112,106.188

$3,118,189,878 767.432,298 2,223,771,212 76.439,290 76.499.931 30,302,626 59.442.768 122 I

CITY OF AUSTIN, TEXAS

,Exhibit F-I (Continued)

Convention Parks and Totals Airport Center Drainage Transportation Golf Recreation 2001 2000 286,284 231,052 709,456 314,618 168,691 55,568 8,106,045

-6,229,468,

q 75,000

- 75.000 69,858,104 88,254,611 S.......

145,060,818 128,547,946 S..........

228,468,720 403,255,427 28,000,000 28,000,000

.- 28,000,000 873,260 452,215 2,056,430 319,120 _

7,988,457 61,855,982 o67,274,825, 361,782,102 236,086,093 3,125,935,659 2,875,791,298 423,000 S...........

" 16,636,520

'17.534,999 1,703,648

- 1 1,976,937

• 6,904,024.

6,700,886--.

4,318,000 42,636,780

- 9,233,172 395,259,646 236,769,360 2,765,886 633,738 8,157,148 55,568 3,735,241,300

3,633,297,569 421,036,030 260.728,976 5,000,269 1,992,620 8,947,100 181,737 4,189,510,119 4,075,898,239 3,033,536 18,988,154 15,188,310 331,206 811,795 1,069,976 56,252,909 55,779,691--

133,713,334

_ 248,339 162,967,116 167,117,885 13,089,374

-1,811,059 15,822,025 30,000 394,672,524 410,144,687. T 488,436 4,175,344 4,175,344 149,836,244 21,535,988

-31,010,335 331,206 841,795 1,069,976 618,067,893 637,217,607 "

10,000,000 1,063,999 11,063,999 11,065,953 11,909,161 11,909,161

-10,152,485 140,638,302 62,638,190

'41,763,062 7,927,778 2,880,746 (941,043) 1,827,745,088 -

1,675,523,274 162,547,463 63,702,189

. 41,763,062 7,927,778 2,880,746 -

'(941,043) 1,850,718,248

-1,696,741,712 312,383,707 85,238,177 72,773,397 8,258,984 3,722,541 128,933 2,468,786,141'-

2,333,959,319 733,419,737 345,967,153 77,773,666 10,251,604 12,669,541 310,670,- 6,658,296,260 6,409,857,558 A123

ENTERPRISE FUNDS COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 REVENUES Utility services User fees and rentals Operating revenues from other governments Operating revenues EXPENSES Operating expenses before depredation Depreciation and amortization Total operating expenses Operating Income (loss) before nonoperating revenues (expenses) and operating transfers NONOPERATING REVENUES (EXPENSES)

Interest and other revenues interest on revenue bonds and other debt Interest capitalized dunng construction Capital contributions Passenger facility charges Amortization of bond issue cost Other nonoperating expense Total nonoperating revenues (expenses)

Cost (recovered) to be recovered in future years Income (loss) before operating transfers Operating transfers:

Operating transfers in Operating transfers out Net Income Add depredation transferred to contributions Net increase (decrease) in retained earnings Retained earnings at beginning of year, as previously reported Prior period adjustment Retained earnings at beginning of year, as restated Retained earnings at end of year Water and Solid Waste Electric

, Wastewater Hospital Services 806,310,682 219,914,504 6,488,666 36,957,905 3,266,054 806,310,682 219,914,504 9,754,720 36,957,905 458,685,525 102,411,722 2,223,956 34,168,607 85,109,400 51.782,640 2,520,452 1.797,946 543,794,925 154.194,362 4,744.408 35,966,553 262,515,757 65,720,142 5,010,312 991,352 47,779,398 13,536,485 1,849,476 696,209 (111,623,386)

(75,672,996)

(1,056,841) 800,393 3,366,279 30,996,387 (718,676)

(456,791)

(3,091)

(909,855)

(149.075)

(3,394)

(62,106,240)

(31.745,990) 1,849,476 433,276 (29,568,154)

(11,151,302) 170,841,363 22,822,850 6,859,788 1,424,628 1,999,247 (67,416,333)

(21,126,805)

(8,650,018)

(2,113,497) 103,425,030 1,696,045 (1,790,230) 1,310,378 103,425,030 1,696,045 (1.790,230) 1,310,378 946,950,414 429,055,419 64,570,982 27,620,015 946,950,414 429,055,419 64,570,982 27,620,015

$ 1,050,375,444 430,751,464 62,780,752 28,930,393 See accompanying independent auditors' report.

124

CITY OF AUSTIN, TEXAS Exhibit F-2

-Convention Parks and Totals Airport -

Center

'Drainage Transportation Golf Recreation 2001 2000 1,026,225,186 1,023,207,762 68,528, 440 11,071,836 25,885,542 19,089,514 6,300,537 3,790,441

'-178,112,881 159,972,993 S..

- 3,266,054 3,278,280 68,528,440 11,071,836 25,885,542 19,089,514 6,300,537 3,790,441 1,207,604,121. 1,186,459,035 39,362,751 15,645,795 23,135,527 15,187,731 2,500,508 761,164 54,550,482 18,146,303 23,896,691 13,977,958 (7,074,467) 1,988,851 6,083,184 10,040,917 1,273,325 (24,339,580)

(14,457,667)

(139,001) 1.237,475 3,090,193 106,500 9,568,393 2,912,379 9,999,244 (104,660)

(167,767)

(16)

(119,809)

(356,568)

(15,891) 2,324,247 (1,850,892) 4,137,296 16,302,205 (8,925,359) 6,126,147 33,198,475 1,378,304 (133,333)

(75,000)

(884,709) 16,168,872 24,198,116 6,619,742 2,468,017 69,168 18,636,889 24,267,284 6,619,742 146,410,574 39,434,905 35,143,320 (2,500,000) 143,910,574 39,434,905 35,143,320 162,547,463 63,702,189 41,763,062 18,074,757 5,311,793 749,149 420,936 18,823,906 5,732,729 265.608 567.808 178,319 142,866 (21,323)

(437,916)

(407)

(1,586)

(177,963) 156,589 (474,599) 422,197 93,209 (183,364) 238,833 93.209 238,833 93,209 7,688,945 2,787,537 7,688,945 2,787,537 7,927,778 2,880,746 3,861,117 702,881,550 639,978,856 10,243

-160,840,169 1 156,647,504 3,871,360 863,721,719 796,626,360 (80,919) 343,882,402 389,832,675 18,791 81,598,970',

71,129,441

,(227,748,710)

(225,078,583) 5,234,561 1,852,527.

46,843,438 9,999,244 9,407,652 (1,452,994)

(1,426,863)

(1,732,555)

'(4,103,677) 18,791 (87,258,046)

(148,219,503)

(40,719,456) 25,711,965 (62,128) 215,904,900 267,325,137 36,56026 25,108,879 (458,516)

(101,041,575)

(86,315,239)

(520,644) 151,439,351 206,118,777 2,537.185

'_ 2.342,835 (520,644) 153,976,536 208,461,612 (420,399) 1,699,241,712 1,488,280,100 (2,500,000)

(420,399) 1,696,741,712 1,488,280,100 (941,043) 1,850,718,248 1,696.741,712 "125

+

ENTERPRISE FUNDS COMBINING STATEMENT OF CASH FLOWS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers Cash payments to suppliers for goods and services Cash payments to employees for services Cash received from other governments Taxes collected and remitted to other governments Net cash provided (used) by operating activities CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:

Operating transfers in Operating transfers out Interest paid on revenue notes and other debt (Increase) decrease in deferred assets Contnbutions from municipalities Loan repayments to other funds Loan repayments from other funds Net cash provided (used) by noncapital financing activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:

Proceeds from the sale of commercial paper notes Proceeds from the sale of general'obligation bonds and other tax supported debt Proceeds from the sale of revenue bonds Proceeds from long-term loans Principal paid on long-term debt Proceeds from the sale of fixed assets Purchased interest received Interest paid on revenue bonds and other debt Passenger facility charges Acquisition and construction of capital assets Contributions from municipality Contnbutions from State and Federal governments Acquisition of Intangible assets Contributions in aid of construction Bond discounts and issuance costs Bond premiums Cash paid for bond defeasance Bonds issued for advanced refundings of debt Cash paid for bond refunding escrow Cash paid for nuclear fuel inventory Net cash used by capital and related financing activities See accompanying independent auditors' report.

Electric Wastewater Hospital Services

$ 864,905,398 224,505,932 6,617,614 36,487,578 (345,410,122)

(50,075,244)

(2,137,996) (16,420,811)

(86,533,773)

(50,818,437)

(146,470)

(17,059,157) 3,266,054 (22,824,871) 410,136,632 123,612,251 7,599,202 3,007,610 1,999,247 (67,416,333)

(21.126,805)

(8,650,018)

(2,113,497)

(170,966)

(8,186)

(9,916)

(938,863) 904,368 (150,000)

(22,610)

(68,676,162)

(21,134,991)

(7,745,650)

(146,776) 72,890,000 99,940,000 1,405,340 (85,379,610)

(28,793,666)

(1,683,362) 928,590 1,782,096 (96,290,708)

(63,413,727)

(1,007,893)

(221,252,697) (118,399,797)

(8,851,778)

(101,582) 4,260,137 12,080,569 (1,540,668)

(2,230,001)

(29,132) 872,584 1,923,865 199,731 (9,651,944) 126,700,000 235,507,025 4,185,585 (125,000,000) (236,084,975)

(4,356,184)

(10,571,733)

$(332,978,765)

(107,442,137)

(11,543,033) 126 Water and Solid Waste

-1

CITY OF AUSTIN, TEXAS Exhibit F-3 Convention Parks and Totals Airport Center

. Drainage Transportation Golf Recreation 2001 2000 68,869.789 12,084,084 25,390,755 19,284,517 6,300,537 3,790,841

'1,68,237.045 1,092,020,136 (21,532,048)

(9,364,578)

(10,275,418)

(10,123,111)

(2,624,747)

(1,498,218)

(469,462,293) _,(388,201,653)

(15,892,440)

(6,568,446)

(12,590,728)

o. (8,066,449)

(2,778,402)

(2,314,090)

(202,768,392)

(187,490,128)

S.....

3,266,054 2,785,271 (22,824,871)

(16,981.467) 31,445.301 (3.848,940) 2,524,609 1,094,957 897,388 (21,467) 576,447,543 502,132,159 33.198,475 (75,000) 1,378,304

'(884,709)

(183,364)

(5,559) ti lr

• q**

31)3 475 488.036 (1 83.364)

- 36,576,026 25,108,879

'(458,516)

(101,041,575)

"(86,315,239),

_o (189,068),

(1,170,582)

J (938,863)

.135,567, 904,368 139,155

...,(178,169)

.21,222 (458,516)

(64,867,281)'

(62,080,998) 172,830,000 170,149,960 (180,752) 4,405

-(127,384)

(111,461) 20,000 (23,413)

(6,887.337) ° 2 (2,092,857) 2,912,379 (4,540) '

31,129 652,345 (678,934) 7,695,000

-r

,40,000,000 1,405,340 (444,108)

(119,832,943)

(134,063,118)

20,000

-930,246 2,715,091 815,775 (434,074)

(198,907,791)

'(201,280,319) 9,999,244

-- 9,407.652 (1,738,435)

(24,769)-

(449,640,566)

(356,196,325)

- - 1,366..

- 621 8,943,294 10,931,313

'(101,582)

(100,000,000) 4,254,591-16,594,929 (1,913)

(3,809,169) 13,119 3.060,414 (9,651,944) 274,917 367,738,710 (286,122)

• (366,842,124)

(10.571.733)

S-- (2,245.888) 240,583 100,000,000 (99,205,027)

, (6,681,685) 127 (133,333)

(2,996,908)

(13,798,898)

(68,313,504)

,(1 5.000,0oo)

" (243,076)

(23.811,694) 9,999,244 (22,079,392)

"" '1,366 8,943,294 1,506 (2,915) 19,986 418,838

-(435,909)

(27.188,752) (100,109,310) -'-(4,278,689)

(2,207,731)

(2.616,616)

,(24,769)

(588,389,802) -,(542,906,283),

(continued) 11333331 33123475 488036 (183,364)

I

ENTERPRISE FUNDS COMBINING STATEMENT OF CASH FLOWS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of investment securities Proceeds from sale and maturities of investment securities Interest on investments Reverse repurchase agreement income Reverse repurchase agreement expense Net cash provided by Investing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents, October 1 (including $476,493,720 in restricted accounts)

Cash and cash equivalents, September 30 (including $431,935,471 In restricted accounts)

RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES:

Operating income (loss)

Adjustments to reconcile operating income to net cash provided by operating activities:

Depredation Amortization Change in assets and liabilities:

(Increase) decrease in working capital advances (Increase) decrease in accounts receivable Increase (decrease) In allowance for doubtful accounts Decrease in due from other funds (Increase) decrease in inventory (Increase) decrease in prepaid expenses and deferred costs (Increase) decrease in other regulatory assets (Increase) decrease in other long-term assets Increase (decrease) in accounts payable Increase (decrease) in accrued payroll and compensated absences Increase (decrease) In deferred revenue Decrease in decommissioning assessment payable (Increase) decrease in unrecovered fuel revenue Increase in accrued landfill closure costs "Decrease in due to other governments Increase (decrease) in other liabilities Increase (decrease) in customer deposits Total adjustments Net cash provided (used) by operating activities Electric Wastewater Hospital Services

$(544,087,681)

(99,397,105) 562,767,173 95.436,997 31,263,718 10,841,010 1,849,476 788,099 49,943,210 6,880,902 1,849,476 788,099 58,424,915 1,916,025 1,703,028 (7,894,100) 106,146,753 116,240,426 33.470,803 19,646,329 164,571,668 118,156,451 35,173,831 11,752,229 262,515,757 65,720,142 5,010,312 991,352 85,109,400 49,282,640 2,520,452 1,797,946 10,346,051 2,500,000 (466,433) 14,857,960 6,830,026 308,517 436,180 433,785 (67,003)

(179,569)

(3,886)

(2,154,651)

(383,983) 20,639 608,733 (16,526)

(100,068)

(2,643,038)

(4,027,304)

(689,228)

(6,367)

(302,709) 803,897 525,833 3,587 79,311 (959,058)

(57,730)

(262,048) 35,803,879 203.138 9,135,820 (782)

(208,377) 762,986 244,931 31,181 147,620,875 57,892,109 2,588,890 2,016,258

$ 410,136,632 123,612,251 7,599.202 3,007.610 See accompanying independent auditors' report, 128 Water and Solid Waste

CITY OF AUSTIN, TEXAS, Exhibit F-3 (Continued)

Convention Parks and Totals Airport Center Drainage Transportation Golf Recreation 2001 2000 (29,467,016)

(34,900,083)

N (707,851,885)

(652,344,315) 38,214,351 34,831,359 731,249,880 668,174,899 6,083,184 9,972,997 1,273,325 160,762 142,866 18,791 62,394,228 61,965,545

.4,398,582

.(4,157,670) 9,904,273 1,273,325 160,762 142,866 (60,930,502) 7,281 (1,135,376)

(1,576,362) 175,394,823 27,546,107 3,912,136 3.366,271 114,464,321

, 27,553,388 2,776,760 1,789,909 18,791 85,792,223 78,037,041 (485,961) 8,9820683

• . (24,818,081) 676,786 556,854,286 581,672,367 190,825 565,836,969 556,854,286, 13,977,958 (7,074,467) 1,988,851 15,187,731 2.500,508 1,126,143 761.164 180,745 (1,805)

(42,393)

(2,743)

(381,219)

(627.743) 136,415 226,140 (32)

(113,895) 3,225,527 535,758 (3,848,940) 2,524,609 265,608 567,808 749,149 420,936 195,003 (50,150)

(51,069)

(90,142)

(165,597) 76,558 74,304 (63) 829.349 329,580 1,094,957 897,388 (80,919) 343,882,402

'389,832,675 10,243

.158,340,169 154,147,504 12,846,051 11,549,749 (466,433) 578,050 400 24,254,033 (38,828,870) 131,372 (364,004) 24,766 (2,589,703) 3,551,801 567.710 (854,809)

(100,068) 356,339 (2,643,038) 123,674 33,727 (3,474,944) 32,876,093 15,271 2,204,700 (5,984,425)

(985,824)

(770,921)

(262,048)

(271,131) 35,803,879 (51,725,251) 203,138 233,505 (493,009)

(189) 7,819,618 7,207,980 916,529 942.443 59.452 232,565,141 112,299,454 (21,467) 576,447,543 502,132,159 (continued)

,129 14,830,519 18,953,735 70.453,852 89,407,587 319,059 2,781,638 263,384 30,964 (1,106,759)

(8,674) 17,467,343 31.445,301

ENTERPRISE FUNDS COMBINING STATEMENT OF CASH FLOWS Year ended September 30, 2001 With comparative totals for year ended September 30, 2000 Water and Electric Wastewater NONCASH INVESTING, CAPITAL AND FINANCING ACTIVmES:

Increase in advances to other funds Increase (decrease) in deferred assets/expenses Unamortized bond discounts, premiums, and issue costs on refunded bonds Increase in capital appreciation bond interest payable Increase in deferred revenue Increase in contributed facilities Net increase in the fair value of investments Amortization of bond discounits, premiums and issue costs Amortization of deferred loss on refundings Gain (loss) on disposal of assets Costs (recovered) to be recovered in future years Loss on extinguishment of debt Due to other funds for fixed assets Contributions from other funds Deferred revenue and other liabilities See accompanying independent auditors' report.

(31,523,876) 9,262,422 (783,202)

(8,514,138)

(7,998,734) 18,229,303 13,707,170 3,029,280 (2,507,444)

(1,458,953)

(320,455)

(29,568,154) 3,366,279 30,996,387 130 Hospital Solid Waste Services (149,075)

(11,151,302)

(116,807)

(3,091)

(30,495)

(3,394)

CITY OF AUSTIN, TEXAS Exhibit F-3

, '(Continued)

Convention Parks and Totals Airport Center

-Drainage Transportation Golf Recreation 2001 2000 S...........-.

4,318,000 (22,261,454) 9,720.597 (7,263)

(790.465)

(16,512,872)

(18,674,086)

(4,318,000) 18,229,303 14,918,520 660,584 207.806 17,604,840 990,517 (586,753)

(357.340)

(1,485)

(282)

(2,360)

(4,912,708)

(5.332,652)

(81,395)

(427,477)

(20)

(539.387)

(510,847)

(119,809)

(356,568)

(15,891) 17,557 (947,635)

(1,835,798)

(40,719,456) 25,711,965 (116,807)

(556.529)

(2,656) 63,750 34,362,666 131

ENTERPRISE FUNDS' COMBINING SCHEDULE OF CHANGES IN FIXED ASSETS AND ACCUMULATED DEPRECIATION Yea'r ended September 30, 2001 Assets Transfers Balance Transfers from from (to)

Balance Septembler 30, Construction Other September 30, 2000 Additions Retirements In Progress Funds (1) 2001 Property, plant and equipment in service:

Electric Water Wastewater Hospital Solid Waste Services Airport Convention Center Drainage Transportation Golf Parks and Recreation Construction In progress:

Electric Water Wastewater Solid Waste Services Airport Convention Center Drainage Transportation Golf Electric-nuclear fuel Inventory Electric-plant held for future use Total

$2,642,600,458 1,038,123,601 998,622,903 74,793,203 39,316,231 681,077,907 115,058,302 21,240,331 7,291,534 12,486,524 148,249 5,630,759,243 151,085,316 52,787,985 34,262,428 20,745,445 40,800,037 28,161,630 25,524,340 778,595 435,017 354,580,793 138,479,330 31,378,983

$6.155.198.349 3,535,337 11,156,476 8,233,587 (25,995) 988,346 193,957 86,507 2,092,857 79,390 24,769 26,365,231 230,118,939 68,864,509 41,268,814 9,104,429 13,213,032 81,927,382 5,716,655 1,494,866 451,708,626 10,571,732 488.645.589 (3,105,832)

(1,358,037)

(1,628,797)

(3,438,539)

(1,033,176)

(1,294,349)

(230,722)

(129,830)

(8,841)

(12,228,123)

(7,406,623)

(7,406,623)

(19,634,746) 180,044,934 32,126,850 10,039,370 17,127,404 43,609,445 1,034,806 7,609,515 778,595 356,236 292,727,155 (180,044,9 (32,126,8 (10,039,3 (17,127,4 (43,609,4 (1,034,8 (7,609,5 (778,5 (356,27 (292,727,1.

5,301 36,866 42,167

34)

50)

70)

04)

45)

06)

15)

95)

36) 4

55) 42.167 See accompanying independent auditor's report.

132 2,823,080,198 1,080,048,890 1,015,267,063 74.793,203 52.979,101 724,642,522 114,992,716 28.705,631 10,070,022 12,913,309 173,018 5,937,665.673 193,752.698 89,525,644 65,491,872 12,722,470 10,403,624 109,054,206 23,631,480 1.573,647 506,155,641 149,051,062 31.378,983 6,624,251,359

CITY OF AUSTIN, TEXAS Exhibit F-4 Accumulated Depreciation Balance Current Transfers- -

Balance September 30, Depreciation and September 30, 2000

& Amortization Retirements Adjustments 2001-1,048,947,313 85,109,400 (2,195,978) 1,131,860,735 242,395,336 23,250,115 (1,293,234) 264,352,217 304,151,983 26.032,525 (1,544,525)

- _328,639,983 31.233,236 2,520,452 33,753,688 24,120,255

_1,797,946 (3,435,145) 22,483,056 112,163,234 15,187,731 (913,367) 128,437,598 23,036,156 2,500,508 (937,781) 24,598,883 4,161,661

-761.164 (214,831) 4,707,994 3,600,510

-- 749,149 (127,387) 36,866 4,259,138 3,216,035 420,936 __

(8,841) 3,628,130 42,930 10,243 53,173 1,797,068,649 158,340,169, (10,671,089) 36,866 1,944,774,595 120,617,005 8,996,050 129,613,055 1,917,685,654 167,336,219 (10,671,089) 36,866 2,074,387,650 (continued) on F

'F 1

ENTERPRISE FUNDS`,-

COMBINING SCHEDULE OF CHANGES IN FIXED ASSETS AND ACCUMULATED DEPRECIATION Year ended September 30, 2001 Electric Water Wastewater Hospital Solid Waste Services Property, plant and equipment:

Land and land rights Buildings Improvements to grounds Machinery and equipment Vehicles Completed assets not classified Less accumulated depreciation Net property, plant and equipment in service Construction in progress Nuclear fuel, net of amortization Plant held for future use Total property, plant and equipment (1) Transfers from (to) other funds and account groups are as follows:

General Fixed Assets 34,352.298 111,199,423 23,954,778 759,502 10,461,629 547,735,403 673,255,342 608,019,323 74,002,127 5,559,117 14,011,739 24,148,080 18,223,947 14,580 4,567,919 2,003,951,131 175,221,740 286,973,97,1 4,045 1,617,316 19,640,769 6,358,696 9,637,897 9,795,959 203.388,858 89.865,609 68,457.147 12,949 20,977.161 2,823,080,198 1,080,048,890 1,015,267,063 74,793,203 52,979,101 (1,131,860,735)

(264,352,217)

(328,639,983)

(33,753,688)

(22,483.056) 1,691,219,463 815,696,673 686,627,080 41,039,515 30.496.045 193,752,698 89,525,644 65,491,872 12,722,470 19,438,007 31,378,983 1,935,789,151 905,222,317 752,118,952 41.039,515 43,218,515 5,301 5,301 See accompanying independent auditors' report.

134

CITY OF AUSTIN, TEXAS Exhibit F-4 (Continued)

Convention Parks and Airport Center Drainage Transportation Golf Recreation Total 58,690,308 26.089,465 2,435,911 324,266 268,267,580 574,379,745 83,644,609 511,963 3,042,324 2.570,149,953 64,634,140 130,155 4,749,395 7,952,456 2,999 138,435,410 15,051,253 1.384,819 9,718,945 187,336 503,475 52,032 2,494.666,063 1,615,577 358,880 2,191,142 4.314,727 256,134 329 54,170.110 10,271,499 3,384,788 9,098,275 5.567,959 834,654 117,658 411,976,557 724,642,522 114,992,716 28,705,631 10,070,022 12.913,309 173,018 5,937,665,673 (126,437,598)

(24,598,883)

(4,707,994)

(4,259,138)

(3,628,130)

(53,173)

(1,944,774,595) 598,204,924 90,393,833 23,997,637 5,810,884 9,285,179 119,845 3,992,891,078 10.403,624 109,054,206 23,631,480 1,573,647 506,155,641 19,438,007 31,378,983 608,608,548 199,448,039 47,629,117 5,810,884' 110,858,826 119,845 4,549,863,709 36,866 42,167

-36,866 42,167 135

136

INTERNAL SERVICE FUNDS Internal service funds are used to account for the financing of goods or services provided by one department to other departments of the City and other agencies on a cost reimbursement basis.

The internal service funds are as follows:

The Fleet Maintenance Fund, which includes vehicle and equipment services; The Support Services Fund, which includes the activities of the various support service departments; The Information Systems Fund, which includes activities of the Information Systems Department; The Employee Benefits Fund, which includes activities related to the health, dental, and life insurance costs of City employees; The Liability Reserve Fund, which provides coverage of the City's major claims liabilities; The Workers' Compensation Fund, which accounts for workers' compensation costs; The Radio Communication

Fund, which includes communication support activities; The Infrastructure Support Services Fund, which includes the activities for support services for five departments; and The Capital Projects Management Fund, which manages the City's capital improvement projects.