Harris County Flood Control District

1 Harris County Flood Control District A Component Unit of Harris County , Texas Comprehensive Annual Financial Report For the Fiscal Year Ended February 29, 2016 Prepared By: Barbara J. Schott, County Auditor 1001 Preston, Suite 800 Houston, Texas 77002 Harris County Flood Control District A COMPONENT UNIT OF Harris County , TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED FEBRUARY 29, 2016 TABLE OF CONTENTS i PAGE INTRODUCTORY SECTION (Unaudited) County Auditors Letter of Transmittal 1 Certificate of Achievement for Excellence in Financial Reporting 5 Schedule of Board Members, Key Personnel and Consultants 6 Organization Chart 8 FINANCIAL SECTION Independent Auditors Report 9 Management s Discussion and Analysis (Unaudited) 13 BASIC FINANCIAL STATEMENTS: Government-wide Financial Statements: Statement of Net Position 23 Statement of Activities 24 Fund Financial Statements.

2 Balance Sheet Governmental Funds 25 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position 26 Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds 27 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balance of Governmental Funds to the Statement of Activities 28 Statement of Fiduciary Net Position Agency Funds 29 Notes to the Basic Financial Statements: 1. Summary of Significant Accounting Policies 30 2. Deposits and Investments 36 3. Property Taxes 41 4. Interfund Balances and Transfers 42 5. Capital Assets 43 6. Long-Term Liabilities 43 7.

3 Retirement Plan 46 8. Other Post Employment Benefits 51 9. Commitments and Contingent Liabilities 55 10. Risk Management 56 11. Fund Balances 56 12. Recent Accounting Pronouncements 57 Required Supplementary Information (Unaudited): Schedule of Revenues and Expenditures Budget and Actual Budgetary Basis Operations and Maintenance (General) Fund 59 Notes to the Required Supplementary Information 60 Other Post Employment Benefits - Schedule of Funding Progress 61 Schedule of Changes in Net Pension Liability and Related Ratios 62 Texas County and District Retirement System - Schedule of Employer Contributions 63 Harris County Flood Control District A COMPONENT UNIT OF Harris County , TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED FEBRUARY 29, 2016 TABLE OF CONTENTS ii PAGE Other Supplementary Information and Individual Fund Statements.

4 Combining Statement of Fiduciary Net Position Agency Funds 65 Statement of Changes in Fiduciary Assets and Liabilities Agency Funds 66 Schedule of Revenues and Expenditures Budget and Actual Budgetary Basis Debt Service Funds 67 Schedule of Revenues and Expenditures Budget and Actual Budgetary Basis Capital Projects Funds 68 STATISTICAL SECTION (Unaudited) TABLE PAGE Financial Trends: Net Position by Component Last Ten Fiscal Years 1 70 Changes in Net Position Last Ten Fiscal Years 2 71 Fund Balances, Governmental Funds Last Ten Fiscal Years 3 72 Changes in Fund Balances, Governmental Funds Last Ten Fiscal Years 4 73 Revenue Capacity: Assessed Value and Actual Value of Taxable Property Last Ten Fiscal Years 5 74 Ad Valorem Tax Rates Last Ten Fiscal Years 6 75 Property Tax Rates All Direct and Overlapping Governments Last Ten Fiscal Years 7 76 Principal Property Taxpayers 8 77 Property Tax Levies and Collections Last Ten Fiscal Years 9 78 Debt Capacity: Ratio of Outstanding Debt by Type Last Ten Fiscal Years 10 79 Estimated Direct and Overlapping Bonded Debt 11 80 Harris County s Legal Debt Margin Information Last Ten Fiscal Years 12 81 Demographic and Economic Information.

5 Demographic and Economic Statistics Last Ten Calendar Years 13 82 Principal Corporate Employers Current Year and Nine Years Ago 14 83 Operating Information: Full-Time Equivalent County Employees by Function Last Ten Fiscal Years 15 84 Capital Asset Statistics by Function/Program Last Ten Fiscal Years 16 85 Operating Indicators by Function/Program Last Ten Fiscal Years 17 86 Other Information: Services and Rates 18 87 General Fund Expenditures 19 89 Taxes Levied and Receivable 20 90 Long-Term Debt Service Requirements - B y Years 21 91 Changes in Long-Term Debt 22 92 Comparative Schedule of Revenues and Expenditures General And Debt Service Funds Five Years Ended 23 93 Operating Funds Budget for the District s Fiscal Year 2016-2017 24 94 Historical Tax Debt Outstanding 25 95 County Assessed Values and Tax Rates (Except Flood Control District ) 26 96 County Tax Levies and Collections (Except Flood Control District )

6 Last Ten Fiscal Years 27 97 County Tax Debt Outstanding 28 98 Harris County Flood Control District A COMPONENT UNIT OF Harris County , TEXAS COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED FEBRUARY 29, 2016 TABLE OF CONTENTS iii TABLE PAGE County -Wide Ad Valorem Tax Debt Service Requirements 29 99 County -Wide Authorized but Unissued Bonds 30 100 Operating Funds Budget for the County s Fiscal Year 2016-2017 31 101 County Capital Projects Funds Budgeting 32 102 PAGE COMPLIANCE SECTION Independent Auditors Report on Compliance for Each Major Program; Report on Internal Control Over Compliance 103 Independent Auditors Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 105 Schedule of Expenditures of Federal and State Awards 107 Notes to the Schedule of Expenditures of Federal and State Awards 108 Schedule of Findings and Questioned Costs 109 I N T R O D U C T O R Y S E C T I O N 1 Mike Post, Chief Assistant County Auditor Accounting Division Mark Ledman, , Chief Assistant County Auditor Audit Division BARBARA J.

7 SCHOTT, Harris County AUDITOR 1001 Preston, Suite 800 Houston, Texas 77002-1817 (713) 755-6505 FAX (713) 755-8932 Help Line (713) 755-HELP August 12, 2016 Honorable District Judges of Harris County , Honorable Members of the Harris County Commissioners Court, and Citizens of Harris County , Texas The Harris County Auditor's Office (the Auditor s Office ) is pleased to present the Basic Financial Statements of Harris County Flood Control District (the District ), a component unit of Harris County , Texas (the County ) for the fiscal year ended February 29, 2016. This report is submitted in accordance with Section of the Texas Local Government Code and was prepared by the staff of the County Auditor's Office. The report consists of management s representations concerning the finances of the District .

8 Therefore, management assumes full responsibility for the completeness and reliability of all of the information presented in this report. We believe the information and data contained herein are accurate in all material respects and is reported in a manner designed to present fairly the financial position and results of operations of the District in accordance with generally accepted accounting principles in the United States of America ( GAAP ). All disclosures necessary to enable the reader to gain an understanding of the District s financial activities have been included, beginning with Management s Discussion and Analysis ( MD&A ) on page 13. Management of the District has established a comprehensive internal Control framework that is designed both to protect the government s assets from loss, theft, or misuse, and to compile sufficient reliable information for the preparation of the District s financial statements in conformity with GAAP.

9 Because the cost of internal controls should not outweigh their benefits, the District s comprehensive framework of internal controls has been designed to provide reasonable rather than absolute assurance that the financial statements are free from material misstatement. The District s financial statements were audited by Deloitte & Touche LLP, an independent audit firm. The goal of the independent audit was to provide reasonable assurance that the financial statements of the District for fiscal year ended February 29, 2016 are free of material misstatement. The independent auditor concluded based upon the audit that there was a reasonable basis for rendering an unmodified opinion that the District s financial statements are fairly presented in conformity with GAAP in all material respects. The independent auditor s report is presented as the first component of the financial section of this report.

10 The independent audit of the District s financial statements includes a broader, federally mandated Single Audit designed to meet the special needs of federal and state grantor agencies. The standards governing Single Audit engagements require the independent auditor to report not only on the fair presentation of the financial statements, but also on the government s internal controls and compliance with legal requirements, with special emphasis on internal controls and legal requirements involving the administration of federal and state awards. These reports are available in the compliance section of this report. 2 PROFILE OF THE District History, Geographic Location, and Population After experiencing devastating floods in 1929 and 1935, local Harris County leaders petitioned the Texas Legislature for assistance. On April 23, 1937, the Texas Legislature passed a bill creating the Harris County Flood Control District (a special purpose District ) and establishing the Harris County Commissioners Court as the District s governing body.