HomeMy WebLinkAboutCity of Bay City - Public Financial ReportPopular Annual
Financial Report
FOR THE YEAR ENDED SEPTEMBER 30, 2021
City of Bay City, Texas
cityofbaycity.org
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CITY OF BAY CITY, TEXAS
Popular Annual Financial Report (PAFR)
FOR FISCAL YEAR ENDED SEPTEMBER 30, 2021
Prepared by: Finance Department
This Popular Annual Financial Report (PAFR) is intended to summarize and simplify the statistical, economic and financial
information contained in the 2021 Comprehensive Annual Financial Report (CAFR). The CAFR was prepared in conformance with
Generally Accepted Accounting Principles (GAAP) and was independently audited by Harrison, Waldrop And Uherek, LLP. The
purpose of the audit was to ensure that City is complying with Generally Accepted Accounting Principles (GAAP). The audit
resulted in the highest level of assurance given. The City’s CAFR is a set of financial statements presenting the total financial
condition of the city based on what actually occurred. It is prepared under the accounting and reporting standards set by the
Government Accounting Standards Board (GASB). This Popular Annual Financial Report (PAFR) is presented in conformity with
Generally Accepted Accounting Principles (GAAP) with the exclusion of the City’s two component units.
For a fully detailed, fully disclosed GAAP based presentation of the City’s financial position, the CAFR, in its entirety, please visit
the City’s website at: www.cityofbaycity.org/transparency-program.
TABLE OF CONTENTS
City Staff……………………………………….…………….3
Key Demographics……………………………..….……5
Fiscal Sustainability…………………………….…..….9
Net Position…………………………………….………..10
Revenue Sources……………………….………………11
Debt……………………………………….…………………14
Capital Assets………………………….………………..16
Glossary…………………………………….………………17
Contact Info/City Achievements……….……….18
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Government Finance Officers Association
Award for Outstanding
Achievement in Popular
Annual Financial
Reporting
Presented to
City of Bay City Texas
For its Annual Financial Report for the
Fiscal Year Ended
September 30, 2020
Executive Director/CEO
The City of Bay City, Texas received its 3rd award for Achievement in Popular Annual Financial Reporting (PAFR) for
the year ended September 30, 2020. The intent of the PAFR is to increase awareness of the financial condition of
the City. This report is created in a manner that summarizes and communicates the City’s financial position in a
user-friendly manner. The PAFR, while unaudited, provides a brief analysis of where the City of Bay City’s revenues
come from and where the dollars go, trends and statistics as well on the local economy. This PAFR is still in
compliance with GAAP in that we present the governmental funds using the current financial resources
management focus and modified basis of accounting. Proprietary funds are used to report the same functions
presented as business type activities in the government wide financial statements.
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About Your City Staff
Over 183.50 full and part-time employees compromise our team within the City of Bay City organization. These
same employees come together day in and day out with the important task of assisting with the delivery of
essential City services. They are dedicated to the development and growth of the city.
Your Bay City City Council
From left to right: Councilman Brent Marceaux, Councilwoman Julie Estlinbaum, Mayor Robert Nelson,
Councilwoman Becca Sitz, Councilman William “Bill” Cornman and Councilman Jason Childers.
The City has a home-rule City Manager-Council form of government. The elected body is made up of a Mayor and
five council members who are elected on an “at-large” basis by the community. The Mayor is elected for a three-
year term while Council Members are all elected for staggered two-year terms. Your City Council meets every
second and fourth Tuesday at 6:00 p.m.
Division Directors
Shawna Burkhart, City Manager
Scotty Jones, Finance Director
Jeanna Thompson, City Secretary
Rhonda Clegg, Human Resources Director
Barry Calhoun, Public Works Director
Robert Lister, Police Chief
Shawn Blackburn, Parks & Recreation Director
James Mason, Airport Manager
Vision:
Bay City, Texas: Clean, Safe and Prosperous
A community for all people where dreams are big
and results are even bigger.
Mission:
The City of Bay City is a community that fosters
future economic growth, strives to deliver superior
municipal services, invests in quality of life
initiatives and is the gateway to the great outdoors.
We encourage access to our unique historical and
eco-cultural resources while maintaining our small-
town Texas charm.
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Organization Chart
5
Key Demographics
Population
According to the 2010 census, Bay City is currently home to about
17,614 residents. The graph to the right represents the City’s
population beginning in 1990 to the projected 2030, based on the
records of the U.S. Census Bureau. The City, according to the
Texas Water Development Board is projected to reach 19,786 by
2030. The City has seen slow, but steady growth. An updated
population count will be available once 2020 Census is complete.
City of Bay City, Texas
Population
Year Population 2012 17,663 2013 17,476 2014 17,509 2015 17,368 2016 17,598 2017 17,809 2018 17,614 2019 17,534 2020 17,471 2021 18,061
18
,
8
5
6
18
,
6
8
3
17
,
6
1
4
18
,
8
9
7
19
,
7
8
6
1990 2000 2010 2020 proj.2030 proj.
Location
The City of Bay City is in southeast Texas, near the Texas Gulf Coast. The City
is about 8.87 square miles, of which 0.12 square miles of water area, with
an elevation of 52 feet. Bay City is the county seat of Matagorda County,
which also includes the cities of Palacios, Matagorda, Van Vleck, Markham,
Blessing and Sargent. Bay City is accessible via State Highways 35 and 60
along with FM 457. These roads provide access to Houston and the market
areas of Brazoria, Jackson and Wharton Counties.
17,000
17,200
17,400
17,600
17,800
18,000
18,200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
CITY OF BAY CITY POPULATION
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Schools
Bay City is served by the Bay City Independent School District. Bay City presently has three Pre-Kindergarten
through Fifth grade elementary schools: Cherry Elementary for Pre-K and Kindergarten, Linnie Roberts Elementary
for First and Second grade and Tenie Holmes for Third through Fifth grades; Bay City Jr. High serves the Sixth
through Eighth grades; Bay City High School serves the Ninth through Twelfth grades. Tenie Holmes and BCJH have
newly constructed campuses opening the Fall of 2019. The new Blackcat football stadium is slated to open, on the
BCHS grounds, in the fall of 2020 as well. Bay City also has a college campus, Wharton County Junior College, which
focuses on technical training and nuclear plant operations.
BCISD Enrollment
Year Enrollment 2012 3,770 2013 3,860 2014 3,735 2015 3,755 2016 3,725 2017 3,571 2018 3,657 2019 3,712 2020 3,536 2021 3,530
Unemployment Rate
Year Rate 2012 10.1% 2013 9.8% 2014 8.3% 2015 6.8% 2016 7.0% 2017 7.4% 2018 7.2% 2019 6.1% 2020 11.4% 2021 13.50%
3,300
3,400
3,500
3,600
3,700
3,800
3,900
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
BCISD ENROLLMENT
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
UNEMPLOYMENT RATE
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Per Capita Personal Income
Year Income 2012 $ 22,000 2013 $ 22,000 2014 $ 35,426 2015 $ 37,324 2016 $ 39,111 2017 $ 39,090 2018 $ 40,827 2019 $ 45,482 2020 $ 50,182 2021 $ 45,089
City Amenities/Services
The City’s primary objective is Public Safety. A full-time equivalent staff of 61 employees are dedicated to serving the
community in the most efficient and cost-effective way possible. The City has one police station with 38 sworn police
officers dedicated to serving and protecting our citizens. The Bay City Volunteer Fire Department, consisting of 26
volunteers, provides the City with fire suppression and rescue protection. Our Animal Control Department, consisting
of 2 animal control officers, responds to all animal calls in conjunction with our Animal Impound.
Taxable
Assessed
Taxpayer Valuation
Nichols Square Partners LTD 15,544,210$
Oak Manor Bay City LLC 12,172,292
Wal Mart Real Estate Business Trust 11,987,930
Cypressbrook Palm Village LP 11,800,500
AEP Texas Central Company 11,256,290
IMFI CB Apartments LP 7,000,000
Bay City Community Development Corp.7,290,990
Interurban Riverway LLP 5,951,750
HE BUTT Grocery Company 5,875,200
Gulf Coast Hardware LLC 5,598,090
94,477,252$
Principal Property Taxpayers PRINCIPAL EMPLOYERS
Employer Employees
South Texas Project (STP) 986
Tenaris 653
Bay City I.S.D 598
Walmart 265
Matagorda County 256
Regional Medical Center
H.E.B 250
Matagorda County 202
OXEA 193
Lyondell 175
City of Bay City 159
$-
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
PER CAPITA PERSONAL INCOME
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Utilities
The City of Bay City owns and operates its own water, wastewater and gas which is operated by the Bay City Gas
Company. Sanitation services have been contracted out to WCA. Currently, the City has approx. 6,100 water and
sewer customers, whether it be residential or commercial. Average daily water consumption (millions) is 1.553 and
average daily sewage consumption (millions) is 1.931. The City maintains 110 miles of streets, 113 water main miles
and 108 sewer miles.
Culture and Recreation
“The Gateway to the Great Outdoors”, there are a variety of things to do within Bay City and the surrounding cities of
Matagorda County.
Citizens can enjoy any one of the City’s 23 parks, 2 pools and sports complex. Hilliard Pool is open from Memorial Day
through Labor Day while the 16th Street Pool is open year-round.
Overview of Audited Results
The following summary highlights are taken directly from the Management Discussion and Analysis (MD&A) section of
the fiscal year 2021 Comprehensive Annual Financial Report (CAFR).
The assets and deferred outflow of resources of the City exceeded its liabilities and deferred inflow of
resources at the close of the most recent fiscal year by $45,718,599 (net position). Of this amount,
$7,541,131 (unrestricted net position) may be used to meet the City’s ongoing obligations to citizens and
creditors.
The City’s total net position of the governmental activities decreased $515,645 and business-type increased
$1,701,688. The net position of the Water and Sewer Fund increased by $1,394,704 and the Airport Fund
increased by $306,984.
As of the close of the current fiscal year, the City’s governmental funds reported combined ending fund
balances of $8,883,301, a decrease of $1,800,465 from the prior year. At the end of the current fiscal year,
unassigned fund balance for the General Fund was $4,839,191, or 35% of total General Fund expenditures.
The City’s outstanding bonded debt for governmental and business-type activities had a net increase of
$3,987,000 or 16% from the prior year. The City also had $865,000 of tax notes and $78,735 in capital leases
payable outstanding as of September 30, 2021.
Local attractions include: Matagorda County Birding and Nature Center, Rio
Colorado Golf Course, Shulman Movie Bowl Grill, Bay City Public Library,
Matagorda County Museum, local downtown square and the Texas Theatre
which is currently under construction.
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Fiscal Sustainability
Government-wide financial statements provide financial information about the city. These statements distinguish
between two types of activities: governmental and business-type. The government-wide focus is more on the
sustainability of the City as an entity and the change in aggregate financial position resulting from the activities
taking place in the fiscal year.
The City’s two kinds of funds are governmental and proprietary (business-type). The City maintained 16 types of
individual governmental funds during the fiscal year. The City adopts an annual budget for its General Fund and
Debt Service Fund. The General Fund is the most significant fund of the City’s 16 governmental funds. The City also
has two proprietary funds. The City uses enterprise funds to account for its water/wastewater utility service and
airport operations. The City uses internal service funds to account for equipment maintenance and information
technology services. Because these services predominantly benefit governmental rather than business-type
functions, they have been included within governmental activities in the government-wide financial statements.
2021 2020 2019 2021 2020 2019 2021 2020 2019
Current & Other Assets 15,153,872$ 15,602,604$ 6,318,462$ 10,157,688$ 6,505,214$ 6,372,674$ 25,311,560$ 22,107,818$ 12,691,136$
Capital Assets (net)28,710,841$ 26,583,419$ 24,165,011$ 27,467,094$ 23,136,325$ 22,845,618$ 56,177,935$ 49,719,744$ 47,010,629$
Other Noncurrent Assets 6,186,836$ 6,660,318$ -$ -$ -$ -$ 6,186,836$ 6,660,318$ -$
Total Assets 50,051,549$ 48,846,341$ 30,483,473$ 37,624,782$ 29,641,539$ 29,218,292$ 87,676,331$ 78,487,880$ 59,701,765$
Total deferred
outlfow of resources 752,907$ 722,419$ 1,849,737$ 296,276$ 159,484$ 430,709$ 1,049,183$ 881,903$ 2,280,446$
Current Liabilities 6,338,227$ 2,616,619$ 2,208,439$ 2,678,176$ 2,343,493$ 2,240,686$ 9,016,403$ 4,960,112$ 4,449,125$
Noncurrent Liabilities 19,243,169$ 21,297,110$ 15,400,562$ 13,331,149$ 7,259,988$ 8,432,558$ 32,574,318$ 28,557,098$ 23,833,120$
Total Liabilities 25,581,396$ 23,913,729$ 17,609,001$ 16,009,325$ 9,603,481$ 10,673,244$ 41,590,721$ 33,517,210$ 28,282,245$
Total deferred
inflow of resources 1,182,385$ 1,098,711$ 65,841$ 233,809$ 221,306$ 49,140$ 1,416,194$ 1,320,017$ 114,981$
Net investment in capital assets 18,917,264$ 21,205,583$ 13,287,618$ 17,403,926$ 15,909,542$ 14,858,787$ 36,321,190$ 37,115,125$ 28,146,405$
Restricted 1,856,278$ 1,199,626$ 857,834$ -$ -$ -$ 1,856,278$ 1,199,626$ 857,834$
Unrestricted 3,267,133$ 2,151,111$ 512,916$ 4,273,998$ 4,066,694$ 4,067,830$ 7,541,131$ 6,217,805$ 4,580,746$
Total Net Position 24,040,675$ 24,556,320$ 14,658,368$ 21,677,924$ 19,976,236$ 18,926,617$ 45,718,599$ 44,532,556$ 33,584,985$
Net Position
Governmental Activities Business-type Activities Total
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The City had an overall increase in Total Net Position of $1,186,043, consisting of a decrease in governmental
activities of $515,645 and in increase in business-type activities of $1,701,688 from 2020 to 2021.
The decrease in the governmental activities is mainly due to a $9,221,849 decrease in capital and operating grants
and contributions. Capital grants and contributions in the prior year mainly related to the recognition of the
interlocal commitment revenue from the Bay City Community Development Corporation and the Bay City Gas
Company as of September 30, 2020 in the amount of $ 7,138,550. Also, expenses of the governmental activities
increased $1,196,702 from the prior year and $760,336 of the increase was attributable to public works.
The increase in the business-type activities is mainly due to an increase in charges for services in the amount of
$898,063. Water and sewer revenues accounted for $ 776,174 or 86% of this positive variance. This is due to rate
increases to support bond payments in connection with critical water and sewer improvements as well as increased
water consumption due to Winter Storm Uri.
2021 2020 2019 2021 2020 2019 2021 2020 2019
Revenues
Program Revenues:
Charges for Services 3,423,064$ 3,269,277$ 3,213,169$ 8,882,292$ 7,984,229$ 8,163,162$ 12,305,356$ 11,253,506$ 11,376,331$
Operating Grants &
Contributions 1,648,408$ 3,441,951$ 2,207,235$ 89,247$ 50,000$ 84,130$ 1,737,655$ 3,491,951$ 2,291,365$
Capital Grants & Contributions 416,419$ 7,844,725$ 376,144$ 326,500$ 730,209$ 219,828$ 742,919$ 8,574,934$ 595,972$
General Revenues:
Property Taxes 5,844,703$ 5,677,751$ 5,603,015$ -$ -$ -$ 5,844,703$ 5,677,751$ 5,603,015$
Sales Taxes 4,934,706$ 4,966,859$ 4,447,508$ -$ -$ -$ 4,934,706$ 4,966,859$ 4,447,508$
Franchise Taxes 1,263,438$ 1,258,458$ 1,266,666$ -$ -$ -$ 1,263,438$ 1,258,458$ 1,266,666$
Other Taxes 685,845$ 698,939$ 779,523$ -$ -$ -$ 685,845$ 698,939$ 779,523$
Unrestricted Investment
Earnings 50,980$ 107,377$ 134,570$ 2,552$ 30,887$ 86,208$ 53,532$ 138,264$ 220,778$
Miscellaneous 354,982$ 501,621$ 483,211$ 875$ 26,900$ 5,800$ 355,857$ 528,521$ 489,011$
Total Revenues 18,622,545$ 27,766,958$ 18,511,041$ 9,301,466$ 8,822,225$ 8,559,128$ 27,924,011$ 36,589,183$ 27,070,169$
Expenses
General Government 3,191,169$ 2,543,235$ 2,525,947$ -$ -$ -$ 3,191,169$ 2,543,235$ 2,525,947$
Public Safety 5,508,076$ 5,434,064$ 5,329,122$ -$ -$ -$ 5,508,076$ 5,434,064$ 5,329,122$
Public Works 6,390,932$ 5,630,596$ 6,347,218$ -$ -$ -$ 6,390,932$ 5,630,596$ 6,347,218$
Cultural and Recreation 2,790,759$ 2,962,822$ 2,720,126$ -$ -$ -$ 2,790,759$ 2,962,822$ 2,720,126$
Interest on Long-Term Debt 522,913$ 636,430$ 329,979$ -$ -$ -$ 522,913$ 636,430$ 329,979$
Water and Sewer -$ -$ -$ 7,443,424$ 7,655,910$ 6,993,425$ 7,443,424$ 7,655,910$ 6,993,425$
Airport -$ -$ -$ 890,695$ 778,555$ 644,192$ 890,695$ 778,555$ 644,192$
Total Expenses 18,403,849$ 17,207,147$ 17,252,392$ 8,334,119$ 8,434,465$ 7,637,617$ 26,737,968$ 25,641,612$ 24,890,009$
Change in Net Position
before Transfers 218,696$ 10,559,811$ 1,258,649$ 967,347$ 387,760$ 921,511$ 1,186,043$ 10,947,571$ 2,180,160$
Transfers (734,341)$ (661,859)$ 768,787$ 734,341$ 661,859$ (768,787)$ -$ -$ -$
Change in Net Position (515,645)$ 9,897,952$ 2,027,436$ 1,701,688$ 1,049,619$ 152,724$ 1,186,043$ 10,947,571$ 2,180,160$
Net Position-October 1 24,556,320$ 14,658,368$ 12,630,932$ 19,976,236$ 18,926,617$ 18,773,893$ 44,532,556$ 33,584,985$ 31,404,825$
Net Position-September 30 24,040,675$ 24,556,320$ 14,658,368$ 21,677,924$ 19,976,236$ 18,926,617$ 45,718,599$ 44,532,556$ 33,584,985$
Governmental Activities Business-type Activities Total
Changes in Net Position
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Revenue Sources
Property Tax
44% of the City’s total revenue is represented by taxes: property, sales, franchise and hotel/motel. Tax Revenues by
Source for Governmental Funds are represented in the table below.
Property taxes are levied each year on October 1st on the assessed values as of the prior January 1st for all real and
personal property located in the City. Appraised values are established by the Appraisal District at market value and
assessed at 100% of appraised value. The City’s property taxes are billed and collected by the Matagorda Country
Tax Office and are due and payable on January 31st. Such taxes are applicable to the fiscal year in which they are
levied and become delinquent with an enforceable lien on the property on January 1st of the subsequent calendar
year. Property tax is the largest source of income for the General Fund making up 28% of the budgeted revenue for
the 2021 fiscal year. This tax supports operations such as police services, fire protection, streets, park maintenance
and code enforcement. The citizens of Bay City elected for .5% of the City’s 2% local option to be used for property
tax relief. Increases in sales tax helps the City decrease its reliance on property tax revenue.
The total value of all taxable property as certified by the Matagorda County Appraisal District is summarized
in the following table:
Current Year
FY 2021
Prior Year
FY 2020
Variance
Variance
Certified Taxable Value (2020 Tax Roll) 897,701,778 867,110,964 30,590,814 3.5%
* The City approved a $10,000 exemption for all Bay City citizens over the age of 65.
The certified assessed taxable property valuations for the 2021 fiscal year (2020 tax roll) equal $ 897,701,778 with a tax
rate of $0.48212 per $100 valuation for maintenance and operations and $0.17288 per $100 valuation for the interest
and sinking fund. The total tax rate of $0.6550 remained the same as compared to fiscal year 2020 (2019 tax roll). The
certified taxable property valuations increased from the 2019 tax roll by $30,590,814 or 3.5%.
Sales Tax
The City of Bay City received $4,934,706 in sales tax in fiscal year 2021. The sales tax is allocated to general fund, tax
relief and to economic development. The City receives 1.5%, for its General Fund and Property Tax Relief, of the 8.25%
tax charged inside the city limits. The Bay City Community Development Corporation receives 0.5%, for economic
development and the remaining 6.25% goes to the State.
Fiscal Penalty
Year Property and Interest Franchise Sales Other Total
2019 5,597,430 78,618 1,266,666 4,447,508 779,523 12,169,745
2020 5,644,455 84,420 1,258,458 4,966,859 698,939 12,653,131
2021 5,868,646 96,898 1,263,438 4,934,706 685,845 12,849,533
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*The pink dotted line above on the Sales Tax graph is to illustrate the budgeted revenues for FY 21 sales tax*
Hotel/Motel Tax
The Hotel Occupancy Tax Fund accounts for the levy and use of the hotel-motel bed tax. “Putting heads in beds”. All
occupants staying overnight in hotels or motels in the City of Bay City for less than 30 consecutive days, are charged
a hotel tax of 13% of the room cost. The City receives 7% of the revenue while the State collects 6%. This money is
used to promote the City of Bay City following strict guidelines on the use of this tax set up by the State
Comptroller’s Office. There are currently 20 hotels/motels in Bay City.
$-
$200,000.00
$400,000.00
$600,000.00
$800,000.00
$1,000,000.00 HOTEL/MOTEL TAX TREND
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Franchise Fees
Franchise fees are collected from major public utility providers operating within the City limits. This charge is for the
use of the City’s right of ways and streets. The fee is usually computed at 5% of gross receipts. The City collected a
total of $1,263,438 at the end of fiscal year 2021 a slight increase as compared to prior year’s collections of
$ 1,258,458. Included in that amount is a Franchise Fee charged to the Public Utility Fund based on 6% of gross
revenue, amounting to $ 501,000.
Licenses & Permits
Revenues from these categories relate to various contractors’ permits, alcohol permits and animal licenses.
Charges for Services
This type of charge can be found in the General Fund, Public Utility Fund and Airport Fund. Charges for Services in the
General Fund are Sanitation Fees, in the Public Utility Fund they are water/sewer charges and in Airport Fund they are
for late fees on hangar rentals.
Fines and Penalties
Fines and forfeitures account for approximately 1% of the citywide revenue and can be found in the General Fund and
Public Utility Fund. In the General Fund, this revenue is represented by payments of citations, warrants, court costs and
Library Fines. The revenue is represented as late payment penalties in the Public Utility Fund.
Miscellaneous
This source can also be found in most funds. This includes items such as rental income, royalties, grants, park fees,
donations, interest income and tie down fees.
Other Revenues/Sources
This is the smallest resource of citywide revenue and can be found in most funds. This includes items such as other
financing sources and contributed capital.
Intergovernmental
This revenue represents transfers from various funds to reimburse the General Fund for services such as office space,
financial services, administrative services, equipment purchases, and capital projects.
Bond Ratings- “City’s Credit Score”
Ratings play a critical role in determining how much the City pays in interest on their debt. “A credit rating is an
assessment of the creditworthiness of a debt instrument based on a credit rating agency’s analytical models,
assumptions, and expectations.”
Standard & Poor’s (S&P): A+ rating due to a weak economy, adequate management with standard financial policies
and practices under our Financial Management Assessment (FMA) methodology, strong budgetary flexibility with an
available fund balance in fiscal year 2016 of 13.7% of operating expenditures, very strong liquidity with total
government cash at 56.5% of total government fund expenditures and 5.6 governmental debt service, adequate debt
and contingent liability position and a strong institutional framework score
Moody’s: A2 rating reflects the city’s pattern of declining liquidity due in part to large general fund transfers that
support debt service, weak resident income indices and above average yet manageable net direct debt burden. The
rating also incorporates the city’s growing tax base and manageable pension burden.
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Long Term Debt
There is no direct limit on debt in the City Charter. Statutes of the State of Texas do not provide any limitations on
the dollar amount of debt cities can float; however, as a matter of policy, the Attorney General of Texas, will not
approve the issuance of bonds where the total debt service of all tax supported debt requires a tax rate of more than
$1.50 per $100 assessed valuation. The truth-in-taxation criterion specifies that debt (Interest & Sinking)
requirements must be met first, and then the operations can be funded. The property tax rate to meet these needs
cannot exceed $2.50 per $100 valuation.
Debt service requirements for the City of Bay City are currently $ .17288 of the current property tax rate of $.6550.
The City has seven outstanding debt issues most of which are Tax and Revenue Certificates of Obligations. The City
has plans to issue debt within the next 12 months to fund water and sewer improvements.
Assessed value, 2020 tax roll $897,701,779 Actual amount of tax-secured
debt service - Year ended
September 30, 2020
$ 3,004,679
Limit on amount designated for debt
service per $100 assessed valuation
x $ 1.50
Legal Debt Service Limit 13,465,527 Legal Debt Margin $10,460,848
At the end of the current fiscal year, the City had total bonded debt outstanding of $28,692,009. Of this amount,
$6,585,000 represents general obligation debt and certificates of obligation totaled $22,107,009. The City’s bonded
debt had a net increase of $3,987,000 or 16% during the fiscal year ended September 30, 2021. This was due to the
issuance of the 2021A and 2021B Certificates of Obligation in the amount of $ 6,867,000. The City also advance
refunded the 2010 and 2012 Certificates of Obligations by the issuance of the 2021 General Obligation Refunding
Bonds in the amount of $6,205,000. The City also had $865,000 of tax notes and $78,735 of capital leases payable
outstanding as of September 30,2021.
2021 2020 2021 2020 2021 2020
Certificates of Obligation 13,177,238$ 15,951,829$ 8,929,771$ 7,193,180$ 22,107,009$ 23,145,009$
General Obligation Bonds 2,751,000$ 1,560,000$ 3,834,000$ -$ 6,585,000$ 1,560,000$
Notes 865,000$ 1,065,000$ -$ -$ 865,000$ 1,065,000$
Capital Leases 78,735$ 116,468$ -$ -$ 78,735$ 116,468$
Plus Issuance Premiums 960,198$ 713,715$ 830,704$ 140,867$ 1,790,902$ 854,582$
Total 17,832,171$ 19,407,012$ 13,594,475$ 7,334,047$ 31,426,646$ 26,741,059$
Governmental Activities Business-type Activities Total Primary Government
Outstanding Debt By Type
General Obligation Bonds
(G.O.’s) are payable from the
proceeds on an annual
property tax, levied within the
limitations of the law. The
payment of these bonds is
guaranteed by the full faith
and credit of the city. These
bonds must be authorized by
a vote of the citizens.
Certificates of Obligation
(C.O.’s) do not require voter
approval and are ordinarily sold
to finance smaller, less
expensive projects which tend
to have shorter pay-out periods
on the debt. These are also
backed by the full faith and
credit of the city and are paid
from property tax receipts.
Revenue Bonds are payable from
specific sources of non-tax revenue
and do not affect the property tax
rate. Coverage Ratios of Revenue
Bonds will always follow the
minimum coverage ratio required
by the revenue bond ordinances. It
shall be the goal of the City to
achieve a budgeted coverage ratio
of 1.60
15
Property Tax Supported Debt
2010 Tax and Revenue Certificates of Obligation (CO)
$3,300,000 – 2010 Tax and Revenue Certificate of Obligation Bond was issued for street and drainage improvements,
park improvements, civic center improvements, and airport improvements. The payments are secured by property
taxes due in annual installments ranging from $245,000 to $255,000 through September 1, 2030; interest varying
between 3.50% and 4.20%.
2013 General Obligation Refunding Bonds
$5,125,000 – 2013 General Obligation Refunding Bond was issued to take advantage of the low interest rate
environment by refunding the callable portion of the General Obligation Bonds, Series 2003 and the Combination Tax
and Revenue Certificates of Obligation, Series 2004 that were originally issued to fund various street projects. The
payments are secured by property taxes due in annual installments ranging from $405,000 to $413,000 through
September 1, 2024; interest fixed at 2.00%.
*2014 Tax and Revenue Certificates of Obligation (CO)
$3,995,000 – 2014 Tax and Revenue Certificate of Obligation Bond was issued for construction and improvement of
streets, sidewalks, water and sewer system, and to purchase public works equipment. The payments are secured by
property taxes due in annual installments ranging from $222,000 to $247,000 through September 1, 2034 funded by
both Utility revenues (25%) and property taxes (75%); interest varying between 2.00% and 4.00%.
*2016 Tax and Revenue Certificates of Obligation (CO) $5,665,000 – 2016 Tax and Revenue Certificate of Obligation Bond was issued for construction and improvement of
streets, sidewalks, water and sewer system, and to purchase park equipment. The payments are secured by property
taxes due in annual installments ranging from $371,000 to $376,000 through September 1, 2036 funded by both
Utility revenues (33.33%) and property taxes (66.67%); interest varying between 2.00% and 3.00%.
2018 Tax Note
$1,285,000 – 2018 Tax Note was issued for building improvements and the acquisition of road equipment. The
payments are secured by property taxes due in annual installments ranging from $195,000 to $230,000 through
March 1, 2025; interest fixed at 3.01%.
2020 Tax and Revenue Certificates of Obligation (CO)
$8,965,000- 2020 Tax and Revenue Certificate of Obligation Bond was issued for the purchase of street equipment,
renovation of the Bay City Regional Airport hangars, and construction of the Nile Valley Road. These payments are
secured by property taxes due in annual installments ranging from $80,000 to $620,000 through September 1, 2045
funded by property taxes and the City’s two component units - Bay City Gas Company and Bay City Community
Development Corporation (BCCDC); interest varying between 2.00% and 3.00%.
*Paid by both property taxes and utility system revenues
Public Utility Fund Supported Debt
2012 Tax and Revenue Certificates of Obligation (CO)
$9,530,000 - 2012 Utility System Tax and Revenue Certificates of Obligation was issued to replace all water meters
and move the City to a fixed based reading system. Other improvements included lighting systems of City facilities,
street light system, and irrigation systems at City parks and recreational facilities. The payments are supported by
the City’s Public Utility Fund and due in annual installments for approximately $800,000 through September 1,
2027; interest varying between 2.00% and 3.25%.
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Capital Assets
The largest portion of the City’s net position $56,177,935 reflects its investment in capital assets, net of
accumulated depreciation, which include land, buildings, machinery, equipment, improvements, infrastructure and
construction in progress, less any debt used to acquire these assets that is still outstanding. The City uses these
capital assets to provide services to citizens; yet these assets are not available for future spending. The City’s
investment in its capital is reported as net of related debt, it should be noted that the resources needed to repay
this debt must be provided from other sources, since the assets themselves cannot be used to liquidate these
liabilities. The net increase in the City’s investment in capital assets was $6,458,191.
Upcoming capital projects slated for fiscal year 2021-2022:
2021 2020 2021 2020 2021 2020
Land 1,603,907$ 1,603,907$ 403,117$ 391,117$ 2,007,024$ 1,995,024$
Construction In Progress 750,429$ 4,195,076$ 3,680,326$ 1,303,113$ 4,430,755$ 5,498,189$
Buildings and Improvements 1,035,434$ 1,328,374$ 1,612,094$ 385,555$ 2,647,528$ 1,713,929$
Machinery and Equipment 3,880,801$ 4,091,053$ 6,292,384$ 5,159,967$ 10,173,185$ 9,251,020$
Infrastructure 21,440,270$ 15,365,009$ 15,479,173$ 15,896,573$ 36,919,443$ 31,261,582$
Total 28,710,841$ 26,583,419$ 27,467,094$ 23,136,325$ 56,177,935$ 49,719,744$
Governmental Activities Business-type Activities Total
Capital Assets (Net of Depreciation)
Nile Valley Road-UPRR Bridge Rehab- $ 500,000
Street Reconstruction Projects- $ 1,300,000
Drainage Construction GLO Grant- $ 15,000,000
Drainage Improvements Hamman Rd.- $ 688,000
Ball Field Lighting at Frahm’s Field- $ 300,000
Katy Water Plant No. 3-Electrical Improvements- $ 300,869
AMI Meter Replacement Program- $ 3,800,000
New Water Plant- North Side- $ 3,500,000
WWTP Rehab- Phase II Construction- $ 12,700,000
New Sewer line extension- SH35 East- $ 1,000,000
Airport Taxiway with Drainage- $ 8,587,000
Capital expenditures are payments used to acquire assets or
improve the life of existing assets. Factors that are considered in
determining capital items are as follows:
• Expected normal useful life of more than 3 years
• The item has a unit cost of $ 10,000 or more (including
freight and installation)
• Buildings and improvements shall also have a cost of
$ 10,000 or more
17
Accounting Terminology
Accrual Basis of Accounting is a method of accounting that recognizes the financial effect of transactions, events
and interfund activities when they occur, regardless of the timing of the related cash flows.
Assigned Fund Balance is the portion of fund balance set aside by the City for a particular purpose.
Current Assets are available or can be made readily available to finance current operations or to pay current
liabilities. Current assets include those which will be used up or converted into cash within one year. Some
examples are cash, investments, taxes receivable, prepaid items and inventories.
Capital Assets include land, improvements to land, easements, construction in progress, buildings, building
improvements, vehicles, machinery, equipment, infrastructure and all other tangible or intangible assets that are
used in operations and that have initial useful lives extending beyond a single reporting period.
Current Liabilities are expected to be paid to vendors or employees from current financial resources within one
year. Also included are unearned revenue and accrued interest.
Committed Fund Balance is the portion of fund balance that represents resources whose use is subject to legally
binding constraints imposed by the City itself.
Deferred Inflows of Resources represent an acquisition of net position that applies to a future period(s) and so will
not be recognized as an inflow of resources (revenue) until that time. Deferred inflows consist of pension activities
related to the difference in expected and actual pension expense.
Deferred Outflows of Resources represent a consumption of net position that applies to a future period(s) and will
not be recognized as an outflow of resources (expense) until then. Deferred Outflows consist of deferred charges on
debt refundings, pension contributions after the measurement date and pension activity. A deferred charge on
refunding results from the difference in the carrying value of refunded debt and its reacquisition price. The amount
is deferred and amortized over the shorts of the life of the refunded (old) debt or refunding (new) debt.
Long Term Liabilities are liabilities with a future benefit over one year, including bonds, capital leases, notes
payable, health claims liability, Other Post-Employment Benefits (“OPEB”), net pension liability, severance payable
and compensated absences.
Net Pension Liability is the difference between the total pension liability and the assets set aside in a trust
restricted to paying benefits to current employees, retirees and their beneficiaries.
Net Position represents the City’s assets less liabilities.
Net Investment in Capital Assets consists of capital assets, net of accumulated depreciation, reduced by the
outstanding balances of borrowings attributable to the acquisition, construction, or improvement of these assets.
Nonspendable Fund Balance is the portion of fund balance that cannot be spent because of the underlying
resources are not in spendable form.
Restricted Net Position consists of restricted assets reduced by liabilities and deferred inflow of resources related
to those assets.
Unrestricted Net Position is the remaining net position of the City after subtracted net investment in capital assets
and restricted net position.
18
City of Bay City Contact Information
In the case of an emergency:
Call 9-1-1
Airport
979-244-5037
3598 FM 2540 N
Animal Control/Impound
979-323-1706
4611 Starling Drive
Mayor’s Office
979-245-2137
1901 5th Street
Police (Non-Emergency)
979-245-8500
2201 Avenue H
Human Resources (Job Info)
979-245-6550
1901 5th Street
Municipal Court (Traffic Fines)
979-245-0035
1824 6th Street
Recycling Center
979-943-8758
1702 Avenue K
Parks and Recreation
979-323-1660
1209 10th Street
Public Works Warehouse
979-323-1659
1217 Avenue J
Utility Billing (Water Bills)
979-245-2322
1901 5th Street
Tax Office (Property Tax Bill)
979-244-7605
1700 7th Street
For a fully detailed and disclosed CAFR, in
its entirety, please visit the City’s website:
www.cityofbaycity.org/transparency-
program
City Achievements
Municipal Court received TMCEC Traffic Safety Award for the 3rd year
in a row
Finance received the Popular Annual Financial Report award for the
2nd time as well as received the Comprehensive Annual Financial Report award and the Distinguished Budget Presentation awards all
through Government Finance Officers of America
Police Department lowered overall UCR statistics from prior year and
was also recognized for best practices by Texas Police Chief’s
Association
Recycling Center recycled and diverted 260 tons of waste and 2,950
gallons of oil from the landfill
Splashpad at Amistad Park was installed and opened for use
Constructed a floating boat dock at Riverside Park
Library earned Achievement in Excellence of Libraries award from
TMLDA; partnered with DSHS to add lactation room; made public
entrances ADA accessible
Nile Valley Road reconstruction and rehabilitation completed of the
roadway and bridge approach for traffic use
Airport completed construction of new T-Hangar row; also awarded
the 2021 General Aviation Airport of the Year from Texas Department
of Transportation- Aviation Division
19
*Nile Valley Road Grand Re-Opening August 17,2021*
*Main Street-Downtown Square*
*New Splashpad-Amistad Park*