HomeMy WebLinkAboutApril 15, 2008 Agenda
AGENDA
CITY OF DENTON CITY COUNCIL
April 15, 2008
After determining that a quorum is present, the City Council of the City of Denton, Texas will
convene in a Work Session on Tuesday, April 15, 2008 at 4:30 p.m. in the Council Work Session
Room at City Hall, 215 E. McKinney Street, Denton, Texas at which the following items will be
consi ere
1. Requests for clarification of agenda items listed on the agenda for April 15, 2008.
2. Receive a briefing, hold a discussion, and give staff direction regarding adding a section
to Chapter 18 of the Code of Ordinances - "Use of Hand Held Mobile Telephones
Prohibited in School Zones".
3. Receive a report, hold a discussion, and give staff direction regarding the 2007
Comprehensive Annual Financial Report and annual audit.
Following the completion of the Work Session, the City Council will convene in a Closed
Meeting to consider specific items when these items are listed below under the Closed Meeting
section of this agenda. When items for consideration are not listed under the Closed Meeting
section of the agenda, the City Council will not conduct a Closed Meeting and will convene at
the time listed below for its regular or special called meeting. The City Council reserves the
right to adjourn into a Closed Meeting on any item on its Open Meeting agenda consistent with
Chapter 551 of the TEXAS GOVERNMENT CODE, as amended, as set forth below.
1. Closed Meeting:
A. Consultation with Attorney -Under Texas Government Code Section 551.071.
1. Receive, consider and hold a discussion related to a briefing from City's
Attorneys, relating to claims, potential claims, and settlement thereof for
matters pertaining to JNC Partners Denton, LLC v. City of Denton,
including legal advice related to future annexation, zoning, subdivision
controls, plat applications, annexation plans, development agreements,
annexation agreements, service plans, utility service, water rights,
permitting and other legal issues related to the future development of land,
as proposed by JNC Partners Denton, LLC.
2. Consider and discuss litigation styled Tower v. City of Denton, Civil
Action No. 4:05cv302, currently pending in the U.S. District Court,
Eastern District, Sherman Division.
ANY FINAL ACTION, DECISION, OR VOTE ON A MATTER DELIBERATED IN A CLOSED MEETING
WILL ONLY BE TAKEN IN AN OPEN MEETING THAT IS HELD IN COMPLIANCE WITH TEXAS
GOVERNMENT CODE, CHAPTER 551, EXCEPT TO THE EXTENT SUCH FINAL ACTION, DECISION, OR
VOTE IS TAKEN IN THE CLOSED MEETING IN ACCORDANCE WITH THE PROVISIONS OF §551.086 OF THE TEXAS GOVERNMENT CODE (THE `PUBLIC POWER EXCEPTION'). THE CITY COUNCIL
RESERVES THE RIGHT TO ADJOURN INTO A CLOSED MEETING OR EXECUTIVE SESSION AS
AUTHORIZED BY TEX. GOVT. CODE, §551.001, ET SE . (THE TEXAS OPEN MEETINGS ACT) ON ANY
ITEM ON ITS OPEN MEETING AGENDA OR TO RECONVENE IN A CONTINUATION OF THE CLOSED
MEETING ON THE CLOSED MEETING ITEMS NOTED ABOVE, IN ACCORDANCE WITH THE TEXAS
OPEN MEETINGS ACT, INCLUDING, WITHOUT LIMITATION §551.071-551.086 OF THE TEXAS OPEN MEETINGS ACT.
City of Denton City Council Agenda
April 15, 2008
Page 2
Regular Meeting of the City of Denton City Council on Tuesday, April 15, 2008 at 6:30 p.m. in
the Council Chambers at City Hall, 215 E. McKinney Street, Denton, Texas at which the
following items will be considered:
1. PLEDGE OF ALLEGIANCE
A. U.S. Flag/Texas Flag
"Honor the Texas flag; I pledge allegiance to thee, Texas, one state under God,
one and indivisible."
2. PROCLAMATIONS/PRESENTATIONS
A. Proclamations/Awards
1. Recognition of the receipt of the National Arbor Day Foundation's Tree
City USA award presented by the Texas Forest Service to the City of
Denton.
3. CONSENT AGENDA
Each of these items is recommended by the Staff and approval thereof will be strictly on
the basis of the Staff recommendations. Approval of the Consent Agenda authorizes the City Manager or his designee to implement each item in accordance with the Staff recommendations.
The City Council has received background information and has had an opportunity to raise
questions regarding these items prior to consideration. Citizens may speak on items listed on the
Consent Agenda. A Request to Speak Card should be completed and returned to the City
Secretary before Council considers the Consent Agenda. Citizen comments on Consent Agenda
items are limited to three minutes.
Listed below are bids, purchase orders, contracts, and other items to be approved under
the Consent Agenda (Agenda Items A - K). This listing is provided on the Consent Agenda to
allow Council Members to discuss or withdraw an item prior to approval of the Consent Agenda.
If no items are pulled, Consent Agenda Items A - K below will be approved with one motion. If
items are pulled for separate discussion, they may be considered as the first items following
approval of the Consent Agenda.
A. Consider approval of the minutes of:
March 3, 2008
March 4, 2008
March 25, 2008
B. Consider adoption of an ordinance authorizing the City Manager to approve a
third amendment to a commercial airport operations lease agreement approved by
Ordinance 2004-362 dated December 1, 2004, between the City of Denton, Texas
and Jet Works Aviation, Inc. on approximately 1.912 acres of land at the Denton
Municipal Airport; and providing an effective date. The Airport Advisory Board
recommends approval (6-0). The Mobility Committee recommends approval
(3-0).
City of Denton City Council Agenda
April 15, 2008
Page 3
C. Consider adoption of an ordinance accepting competitive bids and awarding an
annual contract for the purchase of traffic signal poles for the City of Denton
Traffic Division; providing for the expenditure of funds therefor; and providing
an effective date (Bid 3972-Annual Contract for the Purchase of Traffic Signal
Poles awarded to the lowest responsible bidder meeting specification, Structural
and Steel Products, Inc., in the annual estimated amount of $701,380).
D. Consider adoption of an ordinance accepting competitive bids and awarding an
annual contract for the installation of roadway pavement markings for the City of
Denton Traffic Division; providing for the expenditure of funds therefor; and
providing an effective date (Bid 3995-Annual Contract for the Purchase of
Roadway Pavement Markings awarded to the lowest responsible bidder meeting
specification, Striping Technology LP, in the annual estimated amount of
$140,000).
E. Consider adoption of an ordinance accepting competitive bids and awarding a
public works contract for the reconstruction of West Oak Street; providing for the
expenditure of funds therefor; and providing an effective date (Bid 3994-West
Oak Street Reconstruction awarded to the lowest responsible bidder meeting
specification, Jagoe-Public Company, in the amount of $729,865.75).
F. Consider approval of tax refunds for the following property taxes:
Name Reason Tax Amount
Year 1. De Lage Landers Operational Svc DCAD Supplemental Change 2006 $67,660.58
2. SDS Apartments/Atlantic Housing DCAD Supplemental Change 2004 $63,875.54
3. SDS Apartments/Atlantic Housing DCAD Supplemental Change 2005 $35,773.36
G. Consider approval of a resolution allowing La Mexicana Restaurant to be the sole
participant allowed to sell alcoholic beverages at the Cinco de Mayo Celebration
on May 3, 2008, upon certain conditions; authorizing the City Manager or his
designee to execute an agreement in conformity with this resolution; and
providing for an effective date. The Parks, Recreation and Beautification Board
recommends approval (6-0).
H. Consider approval of a resolution allowing Metzler's Food and Beverage to be the
sole proprietor allowed to sell alcoholic beverages at the Denton Arts and Jazz
Festival on April 25 - 27, 2008, upon certain conditions; execute aone-year
agreement in conformity with this resolution; and providing for an effective date.
The Parks, Recreation and Beautification Board recommends approval (6-0).
I. Consider adoption of an ordinance of the City Council repealing Ordinance No.
2008-057; awarding a purchase for primary and secondary insulated electric
distribution cables for the City of Denton, Texas (Denton Municipal Electric);
providing for the expenditure of funds therefor; and providing an effective date (File No. 3623-Interlocal Agreement for Purchase of Primary and Secondary
Insulated Electric Distribution Cables with the Lower Colorado River Authority
(LCRA) awarded to Techline, Inc., in the estimated amount of $2,205,840). The
Public Utilities Board will consider this item on April 14, 2008.
City of Denton City Council Agenda
April 15, 2008
Page 4
J. Consider approval of a resolution of the City Council of the City of Denton,
Texas, requesting that the Texas Department of Transportation (TxDOT) and the
North Texas Tollway Authority (NTTA) waive the requirement to develop a
market valuation for Interstate 35 East as allowed by Senate Bill 792, further
requesting that NTTA waive its right to develop the project and support TxDOT's
development of the IH3 SE project from Interstate Highway 63 5 to US Highway
3 80, and acknowledge that NTTA's primary role will be to provide the associated
toll operations at a reasonable cost; and providing for an effective date.
K. Consider adoption of an ordinance approving an Agreement for Deposit of Costs
for Off Site Paving in the amount of $2,512,936.95 between the City of Denton
and Aldi (Texas) L.L.C., a Texas limited liability company, for the construction
of off site paving improvements to VVestcourt Road, authorizing the City Manager
or his designee to execute said Agreement on behalf of the City of Denton; and
declaring an effective date.
4. PUBLIC HEARINGS
A. Hold the second of two public hearings to consider, under the annexation
procedures for areas exempted from the municipal annexation plan, the voluntary
annexation and service plan for approximately 484.84 acres of land located west
of Locust Street (FM 2164) and south of Milam Road. The Planning and Zoning
Commission recommends approval (7-0). (A07-0006, Hills of Denton North
Annexation)
5. ITEMS FOR INDIVIDUAL CONSIDERATION
A. Consider adoption of an ordinance providing for an Amended and Restated
Landfill and Digester Gas Rights and Collection Facility Lease between Denton
Power, LLC and the city of Denton, Texas providing for the extraction,
collection, processing, use, sale, and delivery of landfill gas from the City's
Landfill and digester gas from the City's wastewater plant, authorizing the
expenditure of funds therefor, and providing an effective date. The Public
Utilities Board recommends approval (7-0).
B. Consider approval of a resolution of the City Council of the City of Denton,
Texas approving the execution by the City of the "Air North Texas Partner
Agreement" of the North Central Texas Council of Governments and the
Regional Transportation Council, wherein the city of Denton supports the
principles, goals, activities and recommendations of the partnership; and
providing an effective date. The Council Mobility Committee recommends
approval (3-0).
C. Consider nominations/appointments to the City's Boards and Commissions.
D. Citizen Reports
1. Review of procedures for addressing the City Council.
2. Receive citizen reports from the following:
City of Denton City Council Agenda
April 15, 2008
Page 5
A. Carolyn Phillips regarding a traffic light or three way stop at
Woodrow Lane and Morse Street.
B. Pat Foutch regarding a Lee Meadows flood control update.
C. David Smith regarding freeway traffic flow on I-35.
D. Bob Clifton regarding more legal issues.
E. New Business and Announcements
This item provides a section for Council Members to suggest items for future
agendas, request information from the City Manager, and/or make announcements
of public interest.
F. City Manager's Report
G. Possible Continuation of Closed Meeting under Sections 551.071-551.086 of the
Texas Open Meetings Act.
H. Official Action on Closed Meeting Item(s) under Sections 551.071-551.086 of the
Texas Open Meetings Act.
CERTIFICATE
I certify that the above notice of meeting was posted on the bulletin board at the City Hall of the City of
Denton, Texas, on the day of , 2008 at o'clock (a.m.) (p.m.)
CITY SECRETARY
NOTE: THE CITY OF DENTON CITY COUNCIL CHAMBERS IS ACCESSIBLE IN
ACCORDANCE WITH THE AMERICANS WITH DISABILITIES ACT. THE CITY WILL PROVIDE SIGN LANGUAGE INTERPRETERS FOR THE HEARING IMPAIRED IF REQUESTED AT LEAST
48 HOURS IN ADVANCE OF THE SCHEDULED MEETING. PLEASE CALL THE CITY
SECRETARY'S OFFICE AT 349-8309 OR USE TELECOMMUNICATIONS DEVICES FOR THE
DEAF (TDD) BY CALLING 1-800-RELAY-TX SO THAT A SIGN LANGUAGE INTERPRETER
CAN BE SCHEDULED THROUGH THE CITY SECRETARY' S OFFICE.
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: Police Department
ACM: Fred Greene
SUBJECT
Receive a briefing, hold a discussion, and give staff direction regarding adding a section to
Chapter 18 of the Code of Ordinances - "Use of Hand Held Mobile Telephones Prohibited in
School Zones".
BACKGROUND
This ordinance prohibits a driver or operator of a motor vehicle from the use of hand held mobile
telephones in school zones during designated school zone hours. The ordinance prohibits drivers
from using hand held mobile telephones to engage in calls or to create, send, or read messages
while driving or operating a motor vehicle in any school zone on official school days during the
hours when school zones are in effect and when school zone signs and signs prohibiting hand
held mobile telephone use are in place. The ordinance does not prohibit the use of hands free
mobile telephones in school zones.
Respectfully submitted,
4 ~ ,
Roy W. Minter, Jr.
Chief of Police
s:lour daa~te~slordina~cesl08~mobi~e p~o~e ordinancer~nal.doc
ODINANE
A DRDINANE DF THE 1TY DF DENTDN, TEAS SUPPLEMENTING ~HAPTE~ 18
~F THE ODE DF ORDINANCES AND EN.ATIN A NEw SET~N 18-215 "USE OF
HAND HELD MOBILE TLEAH~NE PR~H~~~TED IN SH~4L ONES;" P~vIDIN~
FOR A PENALTY NOT TD EEED FE HUN1]RED DOLLARS; PI~OVIDINr FOR A
SE~ERABILITY LA.USE; PRO~TIDINO FOR INCORPORATION INTO THE OODE OF ~~DIl~ANES; AND POVIDINC~ AN EFFETE DATE.
WHEREAS, to further serve protect school aged children traveling to and from
elementary schools and other educational facilities throughout the state, the Mate of Teas has
ado ted certain laws re atin the s eed of motor vehicles in a school gone said laws ~P~13'~g
~ ~ ~ only on official Schaal days and during the hogs when the schoal gone is in effect; and -
wHEREA, using a hand held mobile telephone alkla a cell phone while operating a
motor vehicle necessarily distracts the actor from his or her operation of~ said orator vehicle and
thus causes him ar her to concentrate Less on driving safely; and
wHEREAS~ using a hand held nubile telephone while operating motor vehicle
necessarily limits the actor's ability to steer and maneuver said motor vh~c~e; and ~ .
wHEEA, the qty of Denton finds that the use of a hand held mobile telephone while
operating a motor vehicle in a schoal gone on official Schaal days and. during hours when the
school gone is in eet creates a danger or probability of it to school children and others that the
Oil seeps to m~-r~imize; and
- wI~REAS, the safety of alb schoal aged children traveling to and from elementary
schools and other educational facilities located in Denton is of paramount importance and, as
such demands a high standard of positive care and control; and
~V-HEEAS, sict liability aenses c~ucle not only those that are regulatory public ,
welfare or a~ ~rohi~i~a in nature, but also those for e~a~nple that are designed to protect
children; and ~ .
wH~REA, the Mates of Oalifornia, onnecttcut, New Jersey, New fork, and
Washington ban the use of hand held mobile telephones while operating a motor vehicles and .
wHE~EAS, the Oity desires to implement those rules and regulations that protect health
life and property and that preserve good go~rernent order and security of the Oity and its
inhabitants; New, THEREFORE, ~ -
THE CITY OOUNCIL ~F THE CITY ~F DENTON HEREBY ORDAINS:
SECTION l . That Ohapter 1 S of the Oode of Ordinances of the Oil of Denton is hereby .
supplemented and a new Section 18-215 "Use of Hand Held Mobile Telephones Prohibited in
School hones" is hereby enacted and is to read as f~Ilows:
Lm
Sec 1S-~i~. Use of Hind Held oboe ~'elephone~ ~ro~bited in Schoen Zene~.
For purposes of this section the following de~initians apply:
~~~gi~g in a ca~~ shall mean talking into, dialing or listening on a hand held mobile telephone
but shall not include balding mobile te~ephane to activate ar deactivate such telephone.
as ~re~ mobile ~e~ep~ao~t shall mean mobile telephone that has an internal feature or
function or that is equipped with an attachment or addition, whether or not permanently p~ of
such mobile telephone by which user engages in a call without the use of either hand or prosthetic device or aid in the case of a physically disabled person,
whether ar not the use o~
either hand yr prosthetic device is necessary to activate deactivate or initiate a function of such
telephone.
a~ held mobile ~~~~p~to~e shall mean a mobile telephone with which a user engages in a call using at least one hand ar prosthetic device ar aid in the case of a physically disabled
person,
I~bile teleplta~ae shall mean the device used by subscribers and other users of wireless telephone
service to access such service and shall include Personal Digital Assistants.
~~rsona~ Digi~~~ ~4ssrsta~at shall mean a device operated using a wireless telecoHin~unications
service that provides for data onnnunication other than by vorce.
ir~~~~ss ~e~ephone service shall mean o-~~.~ real time voice telecom.urdcatian service that
is interconnected to a public switched telephone network and commonly referred to s cellular .
service or personal cammun~catlan ser~~ce.
Exce t as otherwise provided below it shall be unlawful far a person to drive or ~ p
operate a motor vehicle in a school pane as designated in sections l 8-~ l ~ through 1 S-~ 1 on
official school da s during the hours when school pones axe in effect and when school gone signs Y
and signs prohibitinn hand held mobile telephone use are pasted place while using a hand held
mobile telephone to engage in call or to create, send or read messages. .
~c} A.n operator of a motor vehicle who holds a mobile telephone to or in the immediate
proximity of his or her ear while such vehicle is motion i presumed to be engaging in a call
within the meaning of this section. mediate proximity shall mean that distance as per~aits the
v erator of a mobile telephone to hear telecomn~unicatians transmitted aver such .mobile p
telephone, but shall not require physical contact with such operator's ear.
~d~ Subsection ~ shall not apply to:
~ . 'Fhe use of a mobile telephone for the sale purpose of conunicating with any of
the fallowing regarding an emergency situationw an emergency response operator,
a hospital, a physician's office or health clinic, or the pity's Foli~e Department;
gage 2
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Any law enforcement public .safety or police officers, emergency services
officials, first aid emergency medical technicians and personnel, or any ire safety .
officials in the performance of duties arising out of and in the course of their
en~ploy~nent as such; or
The use of a hands free mobile telephone when being used in hands free
manner,
fie} The violation of this section is a strict liability offense.
SECTION Any person violating any provision of this ordinance shall, upon .
conviction, be fined a sum not to exceed Five Hundred Dollars ~0~.~4}.
SECTION ~f any section or portion of this ordinance is far any reason held to be
lnvait or unconst~tuttonal by decision of a court of competent ~ur~sdlctlan, that section or
portion shall be deemed severable and shall not affect the validity of the remaining portions of the ordinance,
ECTIDN 4. This ordinance shall be, and the same is hereby deemed to be, incorporated
into the Code of ordinances of the City of Denton, Texas.
SECTION . This ordinance shall became effective l4 days franc the date of its passage,
and the Ci ecre is hereb directed to cause the caption of this ordinance tv be published
~ y twice in the ~e~t~~ record ~h~oni~~e, the official newspaper of the ~Ci of Denton, Texas,
within I ~ days of the date of its passage.
PASSED AND APPRvED t~.s the day of ~~oS.
PER1~Y cNEI~L, NIAY~~
ATTEST:
TENNIk'E WALTER, CITY SEC~.ETA~ .
BY:
APPROVED AS T~ LErAL F~R~VI:
EDwIl~ M. NYDER, CITY ATTORNEY
+ ~E BY,
Page .
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AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: Finance
ACM: Jon Fortune
SUBJECT
Receive a report, hold a discussion, and give staff direction regarding the 2007 Comprehensive
Annual Financial Report and annual audit.
BACKGROUND
Each year, the City hires an independent accounting firm to conduct an audit of the City's basic
financial statements. The purpose of the audit is to express an opinion as to whether the City's
financial statements present fairly, in all material respects, the financial position of the City. The
annual audit report is comprised of four major components: 1) the Comprehensive Annual
Financial Report (CAFR), 2) Management Letter, 3) Single Audit, and 4) Report to Those
Charged with Governance.
The CAFR represents the entire financial position of the City, specifically for the fiscal year
ending September 30, 2007. The document includes the independent auditor's opinion of
management's representations within the annual report. The auditors have provided the City a
clean opinion, which means that in the opinion of KPMG, the City financial statements present fairly, in all material respects, the financial position of the City. The KPMG
audit specifically
included the following items:
• Audit of the City's CAFR in accordance with generally accepted auditing standards
• Performance of a Single Audit, which is an audit of the City's expenditures of State and
Federal grant awards
• Preparation of a letter to management detailing any weaknesses or ideas for improvement
identified during the audit
• A review, analysis, and evaluation of the City's financial accounting systems and internal
controls
The auditor's examination of internal controls was conducted at a level sufficient to gain an
understanding of the internal control structure to determine nature, timing, and extent of audit
procedures. The auditors did not perform an audit of internal controls, but performed limited
tests of internal controls for the purpose stated above. Additionally, the auditors examined, on a
test basis, evidence supporting amounts and disclosures in the combined financial statements.
Agenda Information Sheet
April 15, 2008
Page 2
PRIOR ACTION/REVIEW
The Audit/Finance Committee reviewed the Comprehensive Annual Financial Report (CAFR)
with staff at their April 1, 2008 meeting.
Prior to the Audit/Finance Committee meeting on April 1, committee members submitted
questions to staff. Staff has provided written responses to these questions which were sent to the
City Council on April 4 along with a draft copy of the minutes from the April 1, Audit/Finance
Committee meeting.
The City Council was provided a copy of the CAFR, Single Audit, Management Letter, and
Report to Those Charged with Governance on April 1, 2008.
EXHIBITS
a) Comprehensive Annual Financial Report
b) Single Audit Report
c) Management Letter
d) Report to Those Charged with Governance
Respectfully Submitted:
Bryan Langley
Director of Finance
CITY OF DENTON, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the fiscal year ended September 30, 2007
CITY MANAGER
George C. Campbell
ASSISTANT CITY MANAGER
Jon Fortune
Prepared by:
Bryan Langley Lori Allen
Director of Finance Accounting Technician
Harvey Jarvis Gary Calmes, CPA Controller Utilities Finance Administrator
Cody Wood Phil Williams, CPA
Chief Accountant Electric Accounting Manager
Diane Chang, CPA Chris Rodriguez Senior Grants Accountant Budget Manager
Kurt Breyfogle Antonio Puente
Senior Utilities Accountant Budget Coordinator
Ed Lane, CPA Katie Griffin
Accountant III Budget Analyst
Mary Billings Michelle McCallum
Accountant III Assistant to City Manager
City of Denton, Texas
Comprehensive Annual Financial Report
For Year Ended September 30, 2007
TABLE OF CONTENTS
Page
INTR OD UCTOR Y SECTION (UNAUDITED)
Transmittal Letter i Organlzatlona C art vl
Certl icate o Ac levement ................................................................................................................................vll
List of Principal Officials viii
FINANCIAL SECTION:
Independent Auditors' Report l
Management's Discussion and Analysis .............................................................................................................3
Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Assets ll Statement of Activities ..........................................................................................................................12
Fund Financial Statements:
Governmental Fund Financial Statements:
Balance Sheet .................................................................................................................................14
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Assets ......15
Statement of Revenues, Expenditures and Changes in Fund Balances ..........................................16
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances
of Governmental Funds to the Statement of Activities ..............................................................17
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget to Actual
General Fund ...............................................................................................................................19
Proprietary Fund Financial Statements:
Statement of Net Assets .................................................................................................................20
Statement of Revenues, Expenses and Changes in Fund Net Assets .............................................24
Statement of Cash Flows ................................................................................................................26
Fiduciary Fund Financial Statements:
Statement of Assets and Liabilities ................................................................................................28
Notes to Basic Financial Statements ...........................................................................................................29
Required Supplementary Information: Schedule of TMRS Funding Progress and Contributions -Last Three Fiscal Years 57
Schedule of Denton's Firemen's Relief and Retirement Plan Funding Progress
and Contributions -Last Three Fiscal Years ........................................................................................58
Combining and Individual Fund Financial Statements and Schedules:
Combining Balance Sheet -Nonmajor Governmental Funds .....................................................................60
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Governmental Funds ............................................................................................................62
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget to Actual:
Debt Service Fund ................................................................................................................................64
Special Revenue Funds:
Recreation .......................................................................................................................................65 Police Confiscation .........................
...............................................................................................66
Tourist and Convention 67
Combining Statement of Net Assets -Internal Service Funds ...................................................................70
City of Denton, Texas
Comprehensive Annual Financial Report
For Year Ended September 30, 2007
TABLE OF CONTENTS
(continued)
Page
FINANCIAL SECTION (continued): Combining and Individual Fund Financial Statements and Schedules (continued):
Combining Statement of Revenues, Expenses and Changes in Fund Net Assets -
Internal Service Funds 72
Combining Statement of Cash Flows -Internal Service Funds ..................................................................74
Combining Statement of Net Assets -Agency Funds .......................................................................................76
Combining Statement of Changes in Assets and Liabilities -Agency Funds ...................................................77
Capital Assets Used in the Operation of Governmental Funds:
Comparative Schedules by Source ..............................................................................................................79
Schedule by Function and Activity .............................................................................................................80 Schedule of Changes by Function
and Activity ..........................................................................................81
STATISTICAL SECTION (UNAUDITED):
Table
1 Net Assets by Component .........................................................................................................................85 2 Changes in Net Assets
...............................................................................................................................86
3 Fund Balances of Governmental Funds ....................................................................................................88
4 Changes in Fund Balances of Governmental Funds ..................................................................................90
5 Assessed Value and Estimated Actual Value of Taxable Property ...........................................................92
6 Property Tax Rates (Per $100 of Assess Value) -Direct and Overlapping Governments .......................93
7 Principal Property Taxpayers ....................................................................................................................95
8 Property Tax Levies and Collections ........................................................................................................96
9 Ratio of Outstanding Debt by Type ...........................................................................................................98
10 Ratio of General Bonded Debt Outstanding ............................................................................................100
11 Direct and Overlapping Governmental Activities Debt ..........................................................................101
12 Pledged Revenue Coverage .....................................................................................................................102 13 Demographic and
Economic Statistics ....................................................................................................104
14 Principal Employers ................................................................................................................................105
15 Full-Time Equivalent City Government Employees by Function/Program ............................................106
16 Operating Indicators by Function/Program .............................................................................................108
17 Capital Asset Statistics by Function/Program .........................................................................................110
REGULATORYSECTION (UNAUDITED):
Comparative Balance Sheet -General Fund ............................................................................................113
Balance Sheet -Enterprise Funds (Traditional Format) ...........................................................................114
Statement of Revenues, Expenses and Changes in Retained Earnings -Enterprise Funds (Traditional Format) ........................................................................................
...................................116
Statement of Cash Flows -Enterprise Funds (Traditional Format) ..........................................................118
Balance Sheet -Internal Service Funds (Traditional Format) ..................................................................122
Statement of Revenues, Expenses and Changes in Retained Earnings -Internal Service Funds
(Traditional Format) ...........................................................................................................................124
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March 5, 2008
T0: The Honorable Mayor, Members of the City Council and Citizens of the City of Denton
It is with great pleasure that we present to you a copy of the Comprehensive Annual Financial Report (CAFR) of
the City of Denton (the City) for the fiscal year ended September 30, 2007. The responsibility for both the accuracy of the presented information and the completeness
and fairness of the presentation of the data, including
all disclosures, rests with the City. To the best of our knowledge and belief, the enclosed data is accurate in all
material respects and is reported in a manner designed to fairly present the results of our operations in each of the
various funds reported by the City. All disclosures necessary to enable the reader to gain an understanding of the
City's financial activities have been included.
The CAFR is presented in four sections: Introductory, Financial, Statistical and Regulatory. The Introductory
Section includes this transmittal letter, the City's organizational chart, and a list of principal officials. The
Financial Section includes the Management's Discussion and Analysis (MD&A), Basic Financial Statements,
Required Supplementary Information, Combining and Individual Fund Financial Statements and Other
Supplemental Information, as well as, the independent auditors' report. The Statistical Section includes selected
financial and demographic information, generally presented on amulti-year basis. The Regulatory Section includes
financial statements presented in a traditional format for the utility and internal service funds.
Management's discussion and analysis (MD&A) immediately follows the independent auditors' report and
provides a narrative introduction, overview, and analysis of the basic financial statements. The MD&A
complements this letter of transmittal and should be read in conjunction with it.
Profile of the Government
The City of Denton was incorporated September 26, 1866. The City operates as a home rule city, under a
council-manager form of government and provides a full range of services as authorized by its charter, such as public safety (police and fire protection); public works (construction
and maintenance of highways, streets and
infrastructure); parks and recreation; electric, water and wastewater utilities; solid waste; and general administrative
services. This report includes all funds of the City.
Local Economy
The City of Denton is located in the northern portion of the Dallas/Fort Worth Consolidated Statistical Area
(CSMA). The City is a part of the Dallas/Fort Worth Metroplex, and is situated at the apex of a triangle based by
Dallas (38 miles to the southeast) and Fort Worth (36 miles to the southwest) providing excellent access to and
from all parts of the area. Due to its proximity to Dallas and Fort Worth, Denton enjoys a low average
unemployment rate of 3.8 percent compared to the state average of 4.6 percent. With the expansion of both its hospitals and other medical facilities, Denton is well on its way
to becoming a regional medical destination serving
north Texas and southern Oklahoma. Denton is also home to two universities that have a combined enrollment of
more than 46,444 students.
Fiscal year 2006-07 brought exciting news in economic development. Listed below are just a few of the highlights.
• Denton Towne Crossing, a 43-acre retail development completed construction and opened the new Super
Target, Home Depot, several retail stores, banks and restaurants. The 340,000 square feet development is
located on the southeastern corner of Loop 288 and Brinker Road.
• Unicorn Lake's mixed-use project continues to develop. The master plan for the development includes
restaurants, residential, commercial and part trails. In 2006-07 Unicorn Lake saw the opening of the Brick House Gym, a bank, and two office buildings. In addition,
construction began on one of the many
i
restaurants planned, as well as, the single-family residential area, which when completed will have over
100 homes beginning in the $350,000 to $400,000 price range.
• The Denton Municipal Airport saw the completion of four new hangar facilities -two of which were private hangars for lease, and two that support the fixed base
operator's expansion and the Jet Works
aircraft completion facility.
• Granite Point Phase I opened and leased 60,000 square feet to Morrison Milling Company and another
60,000 to Tetra Point Fuels. Tetra Point Fuels is an ethanol production facility that will open Summer of
2008. Granite announced they will begin their Phase II project in June 2008.
• United Copper completed their 120,000 square feet expansion to the existing 450,000 square feet plant.
The company manufactures copper wiring for both commercial and residential construction.
• Fastenal Company began construction on their 208,000 square feet distribution facility. The company is
relocating from Carrollton, Texas, where they were unable to expand. Fastenal will perform some light
manufacturing at the facility and will distribute their industrial fasteners throughout north Texas.
• Molecular Insight purchased an existing building and began renovation of the 80,000 square feet facility to
manufacture pharmaceuticals. The company has a working relationship with Trace Pharmaceuticals, an
existing company that manufactures radio isotopes for cancer detection and treatment.
Major Initiatives
According to recent projections from the North Central Texas Council of Governments, the City is expected to
continue growing over the next several years. According to their estimates, the City is projected to reach a
population of approximately 148,143 by the end of 2015.
Growth continues to increase demand for City of Denton services. Sales tax, the second largest revenue source for
the City's General Fund, continues to increase as well. For fiscal year 2006-07, sales tax revenue increased 1.53
percent over the prior year's receipts. For fiscal year 2007-08, sales tax revenue is projected to increase by less
than 1 percent over fiscal year 2006-07 receipts.
The City's tax base has grown considerably over the last few years. The Denton Central Appraisal District's fiscal
year 2006-07 certified appraisal roll shows an increase of 13.6 percent over the fiscal year 2005-06 certified value
and an increase of 24.4 percent over the final fiscal year 2004-OS value. A tax increase of 1.837 cents (per $100 of
valuation) was approved for fiscal year 2006-07. This revenue will be used to fund service enhancements for the
Police, Code Enforcement, Streets, and Library Departments.
Public safety continues to be a major initiative for the City. The City's new Central Fire Station 7 opened in FY
2007 with 15 new firefighters. The Police Department added five additional patrol officers and three civilian
positions. In addition, the City replaced 26 police vehicles and the department's bullet proof vests. The City also
recently completed a Public Safety Training Facility Master Plan and is planning to begin construction in late FY
2008 or early FY 2009.
The City also continues to emphasize community service programs. The FY 2006-07 budget included funding for
the addition of two code enforcement officers to enhance neighborhood vitality. Due to the continuing demand for
library services, the City also continued to plan for the expansion of the South Branch Library and provided
additional resources for library materials related to the expansion project. This will increase funding to the level of 2 books per capita.
The Solid Waste Department implemented several service enhancements. The department is projected to increase
the level of refuse diverted from the landfill through an increase in recycling and the new home chemical collection
program. In addition, the department purchased seven new residential refuse cart collection trucks. The Landfill was also provided the funding to construct the Phase 3A and
3B waste cells.
ii
Financial Information
The City's management team is responsible for establishing and maintaining internal controls designed to ensure
that the assets of the City are protected from loss, theft, or misuse and to ensure that adequate accounting data is
compiled to allow for the preparation of financial statements in conformity with generally accepted accounting
principles. Internal controls are designed to provide reasonable but not absolute assurance that these objectives are
met. The concept of reasonable assurance recognizes that (1) the cost of the controls should not exceed the benefits
likely to be derived and (2) the valuation of cost and benefits requires estimates and judgments by management.
Single Audit
As a recipient of federal and state grant awards, the City is also responsible for ensuring that adequate internal
controls are in place to ensure compliance with applicable state and federal laws and regulations. These controls
are subject to periodic evaluation by management. As a part of the City's single audit, tests are conducted to
determine that the City has complied with applicable laws and regulations related to federal awards.
Budgetary Controls
The City maintains budgetary controls to ensure compliance with legal provisions embodied in the annual
appropriated budget approved by the City Council. Activities of the General Fund, Special Revenue Funds
(Recreation Fund, Police Confiscation Fund, and Tourist and Convention Fund), Debt Service Fund, Enterprise Funds, and Internal Service Funds are included in the annual
operating budget. A capital improvement plan is
approved each year. The level of budgetary control (i.e., the level at which expenditures cannot legally exceed the
appropriated amount) is established by function activity within an individual fund. The City maintains an
encumbrance accounting system as one technique of accomplishing budgetary controls and a technique of
budgetary "lock out" which will prevent a transaction from exceeding legally appropriated budgetary amounts.
As demonstrated by the statements and schedules included in the financial section of this report, the City continues
to meet its responsibility for sound financial management.
Enterprise Operations
The City's enterprise fund operations consist of a utility system and solid waste operations. The City's utility
system provides electric, water and wastewater services. Electric operations did not increase base rates in FY 2006-
07. Retail water rates were increased by 2% in an attempt to improve water conservation for residential customers
with high volume usage. Wastewater operations did not increase retail or wholesale customers' rates. Solid Waste
increased the commercial rates by 4% and made other minor modifications to the residential base rates.
Internal Service Operations
The internal service operations consist of the Materials Management, Fleet Services, Risk Retention, and
Technology Services funds. The Materials Management Fund accounts for the financing of goods provided by the
Warehouse to other City departments. The Fleet Services Fund accounts for the financing of goods and services
provided by the municipal garage to other departments within the City. The Risk Retention Fund accounts for the
accumulation of resources for the payment of workers' compensation, general liability claims, and insurance
policies. The Technology Services Fund provides computer-programming services and systems analysis.
Reprographics, which is part of the Technology Services Fund, provides imaging, print shop, and office services to
City departments.
Fiduciary Operations -Agency Funds
The Agency Funds consist of Payroll, Employee Insurance and Other Agency Funds. The Payroll Fund is
responsible for the collection and payment of the City's payroll and associated liabilities. Employee Insurance
Fund accounts for City and employee contributions to pay for employee health and life insurance premiums. Other
Agency Funds account for various accumulations of resources for non-City entities.
Debt Administration
The City has developed a plan for issuing annual General Obligation Bonds that are approved by voters in a capital improvements plan. Certificates of Obligation are used in accordance
to the City Debt Issuance Policy to finance
facilities, vehicles, and equipment.
iii
Cash Management
The City follows an active program of cash management, keeping all temporarily idle funds in interest-bearing
accounts. These accounts are in the form of money market (government-based) funds, U.S. Treasury issues, and
federal government agency instrumentalities. On September 30, 2007, the annualized yield on investments was
4.47 percent, compared to 4.07 percent and 3.04 percent for the same period in 2006 and 2005, respectively. Funds
available for investment at September 30, 2007 were $312.4 million, which is an increase from $294.2 million in
2006 and an increase from $250.9 million in 2005. The City's investment policy is to safeguard assets with a
minimal amount of risk, while maintaining the necessary level of liquidity and maximizing the yield on investments. Accordingly, all of the City's deposits
are either insured by the Federal Deposit Insurance
Corporation or are collateralized by governmental securities. A third-party financial institution in the City of
Denton's name holds all collateral for deposits. An outside trustee appointed by the City holds the investments of
the Deferred Compensation Plan, in which the City participates, separately from those of other City funds. State
statutes authorize the City to invest in obligations of the U.S. Treasury and U.S. agencies; obligations of the State of
Texas and related agencies; fully collateralized repurchase agreements; local government investment pools; SEC-
registered no-load, money market mutual funds; fully collateralized certificates of deposit; and municipal securities
of any state rated "AA" or above by a nationally recognized rating service.
Risk Management
The City has maintained a very aggressive program to increase safety awareness and training. Incentive programs,
transitional duty, medical-case management, and cost containment should continue to contain workers'
compensation expenditure growth in the future. Legal expenditures for general liability issues have spiked in
previous years due to specific cases that have now been settled.
Independent Audit
The City Charter requires an independent audit of the accounts of the City by an independent auditor. The
accounting firm of KPMG LLP was selected by the City Council to perform the annual audit. In addition to
meeting the requirements set forth in the City Charter, the audit was also designed to meet the requirements of the
Single Audit Act Amendments of 1996 and related OMB Circular A-133.
Awards
The Government Finance Officers' Association (GFOA) awarded a Certificate of Achievement for Excellence in
Financial Reporting to the City for its Comprehensive Annual Financial Report for the fiscal year ended September 30, 2006, for the twenty-second consecutive
year. In order to be awarded the Certificate of
Achievement in Financial Reporting, the City published an easily readable and efficiently organized
Comprehensive Annual Financial Report. This report satisfies both generally accepted accounting principles and
applicable legal requirements. The Certificate of Achievement is held for a period of one year only. We believe
our current Comprehensive Annual Financial Report continues to meet the Certificate of Achievement
requirements, and we are submitting it to GFOA to determine its eligibility for another certificate.
The City also received the GFOA award for Distinguished Budget Presentation for its fiscal year 2006-07 Annual
Budget. In order to qualify for the Distinguished Budget Presentation Award, the City's budget document was
judged according to its compliance with specific guidelines established by GFOA. These guidelines help ensure
that Denton's budget is distinguished as an operations guide, financial plan, policy document, and communication
device. The City has submitted its fiscal year 2007-08 Annual Budget to GFOA to determine its eligibility for
another certificate. We believe it continues to meet the Distinguished Budget Presentation Award criteria.
In 2007, the City's Purchasing Department earned the Excellence in Procurement Award from the National
Purchasing Institute, Inc. (NPI) for 2007 for the tenth year in a row. This award is achieved by those organizations
that demonstrate excellence in procurement by achieving a high score on standardized criteria designed to measure
innovation, professionalism, productivity, and leadership. NPI represents purchasing officials employed by
national, state, and local governments; educational institutions; and tax-supported and public entities throughout the
country.
iv
Acknowledgements
We would like to thank the City Council for their strong leadership and support that helped make the presentation
of this report possible. We would also like to thank the Finance staff, department directors, division heads and
especially the Accounting Division staff for their diligent efforts in the preparation of the annual financial report.
Jon Fortune Bryan Langley Assistant City Manager Director of Finance
v
CITY OF DENTON, TEXAS
ORGANIZATIONAL CHAR T
Citizens City Council
Boards, Commissions, & Committees City Attorney
Municipal Judge Internal Audit
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
City Manager . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Economic Development/ Human Resources
Downtown Development
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Administrative
Services
City Manager's Office
City Secretary
Reprographics
Public Communications Office
Assistant City Manager Assistant City Manager Assistant City Manager
Finance Electric Operations Fire
Solid Waste Operations Library
Accountin Bud et g/ g
Water Operations Parks & Recreation
Municipal Court
Wastewater Operations Police Treasury/Debt
Streets
Materials Management Animal Services
Traffic/Street Lighting
Risk Management Planning
Transportation/Airport
Customer Service Building Inspections
Facilities/Fleet
Code Enforcement
Tech Services
Community Development
- vi -
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Denton
Texas
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
September 30, 2006
A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance 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
standazds in government accounting
and financial reporting.
~
~ President
a~~~~
~~~~r~~~
Executive Director
CITY OF DENTON, TEXAS
List of Principal Officials
September 30, 2007
ELECTED OFFICIALS
Title Name
Mayor Perry McNeill
Mayor Pro-Tem Pete Kamp
Deputy Mayor Pro-Tem Joe Mulroy
Councilmember Charlye Heggins
Councilmember Jack Thomson
Councilmember Bob Montgomery
Councilmember Chris Watts
CITY OFFICIALS
Title Name
City Manager George C. Campbell
Assistant City Manager Howard Martin
Assistant City Manager Jon Fortune
Assistant City Manager Fred Greene
City Attorney Ed Snyder
Municipal Judge Robin Ramsay
City Secretary Jennifer Walters
....1~ 1 iTr.:.; . KPMG LLP Suite 3100
717 North Harwood Street
Dallas, TX 75201-6585
Independent Auditors' Report
The Honorable Mayor and Members of City Council
City of Denton, Texas:
~Ve have audited the accompanying financial statements of the governmental activities, business type
activities, each major fund and the aggregate remaining fund information of the City of Denton, Texas
(the City) as of and for the year ended September 30, 2007, which collectively comprise the City's basic
financial statements as listed in the table of contents. These financial statements are the responsibility of the City's management. Our responsibility is to express opinions on
these financial. statements based on our
audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material.
misstatement. An audit includes consideration. of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the City's internal. control over financial reporting. Accordingly, we
express no such opinion. An audit also includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinions.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, each major fund
and the aggregate remaining fund information of the City as of September 30, 2007, and the respective
changes in financial. position, and, where applicable, cash flows thereof and the budgetary comparison for
the General Fund for the year then ended in conformity with U.S. generally accepted accounting principles.
In accordance with Government Auditing Stc~nda~°ds, we have also issued our report dated February 18,
2008 on our consideration of the City's internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters.
The purpose of that report is to describe the scope of our testing of internal control. over financial reporting
and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part
of an audit performed in accordance
with Govern~~~ent Auditing Standards and should be considered in assessing the results of our audit.
KPMG LLP, a U.S. limited liability partnership, is the U.S. memberfirm of KPMG International, a Swiss cooperative.
The management's discussion and analysis, the schedule of TMRS funding progress and contributions and
the schedule of Denton's Firemen's Relief and. Retirement Plan. funding progress and contributions on
pages 3 through 10, 57 and 58, respectively, are not a rewired part of the basic financial statements but are
supplementary information required by U.S. generally accepted accounting principles. VVe have applied
certain limited procedures, which consisted. principally of inquiries of management regarding the methods
of measurement and presentation of the required supplementary information. However, we dial not audit
the information and express no opinion on it.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City's basic financial statements. The introductory section., combining and individual fund
financial statements and schedules, capital assets used in the operation of governmental funds schedules,
regulatory section and statistical section are presented for purposes of additional analysis and are not a
required part of the basic financial statements. The combining and individual. fund financial statements and
schedules have been. subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material
respects in relation to the basic financial
statements taken as a whole. The introductory section., capital assets used in the operation of governmental.
funds schedules, regulatory section and statistical section. have not been subjected to the auditing
procedures applied in the audit of the basic financial statements and accordingly, we express no opinion on
them.
February ] 8, 2008
CITY OF DENTON, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS
SEPTEMBER 30, 2007
The City of Denton's Management's Discussion and Analysis is designed to (a) assist the reader in focusing on
significant financial issues, (b) provide an overview of the City's financial activity, (c) identify changes in the
City's fnancial position (its ability to address the next and subsequent years' challenges), (d) identify any
material deviations from the financial plan (the approved budget), and (e) identify individual fund issues or
concerns.
Since the Management's Discussion and Analysis (MD&A) is designed to focus on the current year's activities,
resulting changes and currently known facts, please read it in conjunction with the Transmittal Letter
(beginning on page i) and the City's fnancial statements (beginning on page ll
FINANCIAL HIGHLIGHTS
• The assets of the City exceeded its liabilities at the close of the fiscal year ended September 30, 2007, by
$512,3 51,177 (net assets). Of this amount, $13 8,575,851 (unrestricted net assets) may be used to meet the
government's ongoing obligations to citizens and creditors.
• The City's total net assets increased by $39,255,728. This increase can be attributed to the net revenue of
the governmental activities, business-type activities and the contribution of capital assets by developers.
• As of September 30, 2007, the City's governmental funds reported combined fund balances of $81,313,672, an increase of $27,442,558 in comparison with the prior
fiscal year, due to increased revenue
from taxes and the proceeds from the issuance of long-term debt. Approximately 39% of the $81,313,672,
$31,455,921, is available for spending at the government's discretion (unreserved fund balance).
• At the end of the fiscal year, the unreserved and undesignated fund balance for the General Fund was $18,199,161, or 23.68% of budgeted general fund expenditures.
• The City's total noncurrent liabilities increased by $21,812,324 during the fiscal year. The primary reason
for the increase was the issuance of $16.7 million of revenue bonds, $15.9 million of general obligation
bonds, and $11.5 million of certificates of obligation bonds along with the normal pay down of general obligation bonds and certificates of obligation bonds of $9.4 million,
and the normal pay down of revenue
bonds of $13.3 million.
OVERVIEW OF THE FINANCIAL STATEMENTS
The Management's Discussion and Analysis is intended to serve as an introduction to the City of Denton's
basic fnancial statements. The City's basic financial statements comprise three components: (1) government-
wide financial statements, (2) fund financial statements and (3) notes to the financial statements. This report
also contains other supplementary information in addition to the basic fnancial statements themselves.
Government-wide Financial Statements. The government-wide financial statements are designed to provide
readers with a broad overview of the City's finances in a manner similar to private-sector business.
The statement of net assets presents information on all of the City's assets and liabilities, with the difference between the two reported as net assets. Over time, increases
or decreases in net assets may serve as a useful
indicator of whether the financial position of the City is improving or deteriorating.
The statement of activities presents information showing how the City's net assets changed during the most
recent fiscal year. All of the current year's revenues and expenses are taken into account regardless of when
cash is received or paid. Thus, revenues and expenses are reported in this statement for some items that will
only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but not used vacation leave). Both the statement of net assets and the statement
of activities are prepared using the accrual basis of
accounting as opposed to the modified accrual basis.
In its Statement of Net Assets and the Statement of Activities, the City is divided between two kinds of
activities:
• Governmental activities. Most of the City's basic services are reported here, including police, fire,
libraries, development, public services and operations, public works, building inspection, technology
3
CITY OF DENTON, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
SEPTEMBER 30, 2007
services and general administration. Property taxes, sales taxes and franchise taxes finance most of these
activities.
• Business-type activities. The City charges a fee to customers to cover the cost of services it provides. The City's utility systems (electric, water and wastewater) and
solid waste activities are reported here.
The government-wide financial statements can be found on pages 11-13 of the report.
Fund Financial Statements. A fund is a grouping of related accounts used to maintain control over resources
that have been segregated for specific activities or objectives. Fund financial statements provide detailed
information about the most significant funds, not the City as a whole. Some funds are required to be
established by state law or bond covenants. However, the City Council establishes many other funds to help it
control and manage money for particular purposes or to show that it is meeting legal responsibilities for using
certain taxes, grants and other monies. All of the funds of the City can be divided into three categories:
governmental funds, proprietary funds and fiduciary funds.
• Governmental funds. The majority of the City's basic services are reported in governmental funds, which
focus on how money flows into and out of those funds and the balances left at year-end that are available
for spending. These funds are reported using an accounting method identified as the modified accrual basis
of accounting, which measures cash and all other financial assets that can readily be converted to cash. The
governmental fund statements provide a detailed short-term view of the City's general government
operations and the basic services it provides. Governmental fund information helps the reader determine
whether there are more or fewer financial resources that can be spent in the near future to finance the City's programs. By comparing information presented for governmental funds
with similar information presented
for governmental activities in the government-wide financial statements, readers may better understand the
long-term impact of the government's near-term financing decisions. The relationship or differences
between governmental activities (reported in the Statement of Net Assets and the Statement of Activities)
and governmental funds is detailed in a reconciliation following the fund financial statements.
The City of Denton maintains ten governmental funds. Information is presented separately in the
governmental funds balance sheet and in the governmental funds statement of revenues, expenditures and
changes in fund balances for the general fund, debt service fund and capital projects fund, all of which are
considered to be major funds. Data from the other seven governmental funds are combined into a single,
aggregated presentation. Individual fund data for six of these non-major governmental funds along with an
aggregate of all other is provided in the form of combining statements elsewhere in this report.
• Proprietary funds. The City charges customers for certain services it provides, whether to outside
customers or to other units within the City. These services are generally reported in proprietary funds.
Proprietary funds are reported in the same manner that all activities are reported in the Statement of Net
Assets and the Statement of Activities. In fact, the City's enterprise funds (a component of proprietary
funds) are similar to the business-type activities that are reported in the government-wide statements but
provide more detail and additional information, such as cash flows. The internal service funds (the other
component of proprietary funds) are utilized to report activities that provide supplies and services for the
City's other programs and activities, such as the City's municipal warehouse, the City's self insurance fund and equipment maintenance function. Because these services benefit
both governmental and business-type
functions, they have been included in both the governmental and business-type activities in the
government-wide financial statements.
The City of Denton maintains four enterprise funds. The City uses enterprise funds to account for its
electric, water and wastewater systems and solid waste operations. The funds provide the same type of information as the government-wide financial statements, only in
more detail and include some of the
internal service fund-type activity. The City considers all enterprise funds to be major funds.
4
CITY OF DENTON, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
SEPTEMBER 30, 2007
• Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties outside
the government. Fiduciary funds are not reflected in the government-wide financial statement because the
resources of those funds are not available to support the City's own programs. The accounting used for
fiduciary funds is much like that used for proprietary funds. Agency funds are a component of fiduciary
funds. Agency funds differ from other fiduciary funds in that they do not typically involve a formal trust
agreement. Agency funds are used to account for situations where the City's role is purely custodial, such
as receipt, temporary investment and remittance of fiduciary resources to individuals, private organizations,
or other governments.
The City maintains three fiduciary funds. The City uses agency funds to account for the collection and
payment of the City's payroll and associated liabilities, employee-purchased insurance and other similar
relationships.
Notes to the financial statements. The notes provide additional information that is essential to a full
understanding of the data provided in the government-wide and fund financial statements. The notes to the
financial statements can be found on pages 29 - 56 of this report.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
As of September 30, 2007, the City's combined net assets were $512,351,177, of which $131,482,550 can be
attributed to governmental activities and $380,868,627 attributed to business-type activities. This analysis
focuses on the net assets (Table 1) and changes in net assets (Table 2) of the City's governmental and business-
type activities.
The largest portion of the City's net assets (66.7%) reflects its investment in capital assets (e.g., land, building,
machinery and equipment), less any related debt used to acquire those assets that is still outstanding. The City
uses these capital assets to provide services to citizens; consequently, these assets are not available for future
spending. Although the City's investment in its capital assets is reported net of related debt, it should be noted
that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.
Table 1
Net Assets
(in thousands}
G~vemmenhal Business-tune Aetivities Activities Total
2007 2006 2047 200 2007 2006
Current and other assets $ 94,G55 $ 51,555 $ 29,434 $ 24,529 $ 3G4,092 $ 325,354
Capital a55et5 179,923 150,4b5 449,529 422,Ob2 X29,452 b02,527
Total a55et5 274,551 22,020 715,9G3 ~G5,591 993,544 930,911
Long-term liabilities outstanding 124,12G 107,70 255,703 253,310 412,529 391,01
Other liabilities 15,973 lb,ll l 49,391 SO,ti55 G5,3ti4 tib,799
Total liabilities 143,099 123,517 335,094 333,995 451,193 457,515
Net a55et5:
Invested in capital assets,
net a~related debt 99,555 107,410 242,01 213,075 341,574 320,455
Restricted 55~ 440 31,015 30,975 31,901 31,415
Unrestricted 30,735 30,353 107,535 90,543 135,57G 121,19b
Total net a55et5 $131,452 $135,203 $ 350,SG9 $ 334,593 $ 512,351 $ 473,09b
5
CITY OF DENTON, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
SEPTEMBER 30, 2007
Governmental activities decreased the City's net assets by $6,720,088 and business-type activities increased the
City's net assets by $45,975,816. The key elements of these increases are contained in Table 2.
Table 2
Changes in Net Assets
(in thousands)
Governmental Business-type
Activities Activities Total
2007 2006 2007 2006 2007 2006
Revenue
Program Revenue:
Charges for services $13, 877 $13,965 $195,405 $221,151 $209,282 $23 5,116
Operating grants and contributions 2,991 3,713 - - 2,991 3,713
Capital grants and contributions 5,399 5,537 8,441 10,023 13,840 15,560
General Revenue: Property tax 34,756 30,001 - - 34,756 30,001
Sales tax 20,654 20,343 - - 20,654 20,343
Franchise tax 15,198 16,500 - - 15,198 16,500
Hotel occupancy tax 1,269 1,133 - - 1,269 1,133
Beverage tax 295 258 - - 295 258
Bingo tax 24 24 - - 24 24 Investment Income 3,633 1,967 12,109 5,971 15,742 7,938
Miscellaneous 3,199 3,892 548 1,955 3,747 5,847
Total revenue 101,295 97,333 216,503 239,100 317,798 336,433
Expenses:
General government 22,146 22,166 - - 22,146 22,166
Public safety 42,162 36,627 - - 42,162 36,627
Public works 14,009 12,485 - - 14,009 12,485
Parks and recreation 11,564 10,497 - - 11,564 10,497 Interest on long-term debt 4,658 4,333 - - 4,658 4,333
Electric - - 123,927 145,368 123,927 145,368
Water - - 25,840 26,708 25,840 26,708
Wastewater - - 18,785 19,028 18,785 19,028
Solid waste - - 15,451 13,455 15,451 13,455
Total expenses 94,539 86,108 184,003 204,559 278,542 290,667
Increase in net assets before transfers 6,756 11,225 32,500 34,541 39,256 45,766 Transfers (13,476) 895 13,476 (895) - -
Increase in net assets (6,720) 12,120 45,976 33,646 39,256 45,766
Net assets at beginning of year - 138,202 126,082 334,893 301,247 473,095 427,329
Net assets at end of year $131,482 $138,202 $380,869 $334,893 $512,351 $473,095
Governmental activities. The most significant governmental activities expense was in providing public
safety, which incurred expenses of $42,161,674. These expenses were funded by revenues collected from a
variety of sources, with the largest being from property taxes, which are $34,756,356 for the fiscal year ended
September 30, 2007. The most significant portion of public safety is the cost of personnel, which totaled
$31,415,487. Other significant governmental activities expense for the City includes general government,
which incurred $22,145,804 in expenses, of which $12,371,944 represented personnel charges. During the
fiscal year Motor Pool, an internal service fund, was dissolved resulting in a transfer of net assets to business-
type activities of $14,332,928, which included the net value on capital assets as well as any unspent cash
allocated to vehicle and equipment purchases. Governmental activities' portion of the Motor Pool dissolution
was $9,900,198, but since internal service funds are classified as governmental activities, there is no effect presented above.
L
U
CITY OF DENTON, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
SEPTEMBER 30, 2007
Increased expenses for governmental activities include $3.4 million additional depreciation relating to vehicles
and equipment transferred to the general government from Motor Pool; $l .l million depreciation adjustment on
public safety equipment; increased capital purchases of $ l . l million; and $1.5 million associated with the
commencement of operations at fire station #7. The $4.0 million increased revenues in governmental activities are mainly due to a 13.6% increase to the property tax base in fiscal
year 2007 over fiscal year 2006.
Business-type activities. Business-type activities increased the City's net assets by $45,975,816, accounting
for the total growth in the entity-wide net assets. A key element of this increase is capital contributions,
emerging as a maj or revenue source for the Water and Wastewater funds during the current fiscal year,
producing $8,440,634 in revenue. Contributions of assets arise from new property development within the City. Charges for services decreased $25,745,292 due to Energy Cost
Adjustment (ECA) rate decreases by
50.1% as a result of lower energy costs and decreased sales volumes as a result of rain totals ten inches above
normal. The expense decrease between fiscal years 2006 and 2007 reflects decreased costs of production as it
relates to the above normal rainfall. As noted in governmental activities, Motor Pool was dissolved resulting in
a transfer of net assets to business-type activities of $14,332,928.
FINANCIAL ANALYSIS OF THE GOVERNMENT'S FUNDS
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal
requirements.
Governmental funds. The focus of the City's governmental funds is to provide information on near-term
inflows, outflows, and balances of resources available to spend. Such information is useful in assessing the
City's financing requirements. In particular, unreserved fund balance may serve as a useful measure of a
government's net resources available for spending at the end of the fiscal year.
As of the end of the current fiscal year, the City's governmental funds reported a combined ending fund
balance of $81.3 million, an increase of $27.4 million in comparison with the prior year. Approximately $27.1
million constitutes unreserved, undesignated fund balance, which is available for spending at the government's
discretion. In addition to unreserved, undesignated fund balance, the governmental funds reported unreserved,
designated fund balance of $4.3 million. The remainder of the fund balance is reserved to indicate that it is not available for new spending because it has already been committed
1) to purchase or construct capital assets
($49.0 million), or 2) to pay debt service ($0.9 million).
The general fund is the chief operating fund of the City. At September 30, 2007, the unreserved and
undesignated fund balance of the general fund was $18.2 million, or 23.68% of budgeted general fund
expenditures. The unreserved and undesignated fund balance of the general fund increased by $4.9 million
during the current fiscal year due to expenditures being less than anticipated by $2.9 million and higher than
anticipated revenues from return on investment of $0.9 million and fees for services of $0.5 million.
The entire balance of the capital projects fund is reserved for capital construction and acquisition. At the end of
the fiscal year, the capital projects fund has a fund balance of $49.0 million, an increase of $16.1 million. In 2007, the City received $24.8 million of proceeds from the issuance
of debt while expending $14.5 million on
construction and acquisition. In addition to 2007 debt proceeds, the capital projects fund received $1.8 million
in interest income, $1.3 million of revenue related to gas wells, and transfers in from the general fund, motor
pool, and CDBG grant of $ l . l million, $ l , l million and $0.4 million respectively.
The debt service fund has a total fund balance of $0.9 million all of which is reserved for the payment of debt
service. The overall increase in the debt service fund balance was $0.4 million.
Proprietary funds. The City's proprietary funds provide the same type of information found in the
government-wide financial statements, but in more detail.
CITY OF DENTON, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
SEPTEMBER 30, 2007
Unrestricted net assets in Electric, Water, and Wastewater at September 30, 2007 are $72.1 million, $19.0
million, and $10.0 million respectively. Solid Waste has unrestricted net assets of $4.1 million. The results
reflect an increase of unrestricted net assets in each fund, specifically $9.7 million in Electric, $1.4 million in
Water, $4.4 million in Wastewater, and $1.4 million in Solid Waste. Other factors concerning the finances of these funds have already been addressed in the discussion of the City
of Denton'sbusiness-type activities.
GENERAL FUND BUDGETARY HIGHLIGHTS
During fiscal year 2006-2007 there were no formal amendments to the City of Denton general fund budget.
For fiscal year 2006-07, General Fund actual expenditures (including transfers) on a budgetary basis were
$76.1 million compared to the budget of $76.9 million. The $0.8 million variance was primarily due to reduced
personnel costs for the general government and an offsetting transfer to the recreation fund to cover the aquatic
center deficit balance. Actual revenue (including transfers and proceeds from capital leases) on a budgetary
basis was $83.6 million compared to the original budget of $77.3 million. Of the $6.3 million variance,
approximately $5.2 million was the transfer from the Motor Pool fund due to dissolution and $l.l million was
due to the unbudgeted proceeds on capital leases.
Over the years, the Denton City Council has followed a policy of maintaining a general fund balance in order to
plan for unforeseen emergencies and place the City in a more favorable position. In 1997-1998, the policy
level was increased from 10% to 12.5% of general fund expenditures. In 1999-2000, the percentage was
increased to 13% , in 2004-2005 to 13.5%, and in 2005-2006 to 14.0%. The 2006-07 budget increased the
policy level to 14.5%. The City of Denton's unreserved and undesignated fund balance at September 30, 2007
is $18.2 million, or 23.68% of budgeted expenditures.
Below is a listing of the ending unreserved balances for the past three years, as well as fiscal year 2006-07
projected and actual. For those years where the actual ending balance has exceeded the policy level, the
following year's budget has included utilization of that amount for one-time expenditures. By using the fund
balance for one-time expenditures only, the financial impact on future budgets is eliminated.
Actual Actual Adopted Projected Actual
9/30/0S 9/30/06 9/30/07 9/30/07 9/30/07
Unreserved balances $9,718,368 $13,264,027 $11,150,708 $14,432,949 $18,199,161
of total budgeted expenditures 13.98% 18.84% 14.50% 18.77% 23.68%
Policy level 13.50% 14.00% 14.50% 14.50% 14.50%
The largest revenue source of the General Fund's budget was the ad valorem tax. Denton's ad valorem tax rate
is comprised of two components. The first is the operations and maintenance component that is used to
calculate revenue for the City's General Fund operations. The second component is the debt portion that is
used to calculate revenue to pay the City's general debt service obligations. The Denton Central Appraisal
District's certified appraisal roll shows an increase of 13.61 % over the prior year certified value and 11.94%
over the final 2005 value (including supplements). This increase consisted of $255.2 million of new value
added for 2006 and a $396.6 million increase in value for property on the tax rolls in 2005. The 2006-07 ad
valorem tax rate was increased by $0.01837 to $.62652 per $100 of valuation, which was used to provide enhanced services for police, streets, code enforcement and library
services.
CAPITAL ASSET AND DEBT ADMINISTRATION
Capital assets. At the end of fiscal year 2007, the City had $629,452,713 invested in a broad range of capital
assets, including police and fire equipment, buildings, park facilities, roads, bridges and water and sewer lines
(see Table 3 on the following page). This amount represents a net increase (including additions and deductions) of $26,925,881 or 4.5% over the prior fiscal year.
Q
0
CITY OF DENTON, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
SEPTEMBER 30, 2007
Table 3
Capital Assets at Year-end
(Net of Accumulated Depreciation, in Thousands Governmental Business-type
Activities Activities Totals
2007 2006 2007 2006 2007 2006
Land $ 7,840 $ 7,830 $ 10,015 $ 9,780 $ 17,855 $ 17,610
Landfill improvements - - 253 549 253 549
Buildings and improvements 41,766 39,084 4,802 4,171 46,568 43,255
Plant, machinery and equipment 20,881 28,666 116,625 98,879 137,506 127,545
Water rights - - 57,099 57,795 57,099 57,795 Infrastructure 95,568 95,255 226,441 213,637 322,009 308,892
Construction in progress 13,869 9,630 34,294 37,251 48,163 46,881
Total capital assets $179,924 $180,465 $449,529 $422,062 $629,453 $602,527
This year's major additions included:
De9c rip~tian Anununt
Fine Station #7 ~ 4,024,221 Preserve at Pecan creek -development infrastructure 3,155,720
Villages ofCarmel Phase lA -development infrastn~cture 1,554,951
Bernard Street upgrade 1,512,990
wheeler Ridge Phase 4 -development infrastructure 1,31,335
L~rary Books 1,005,150
Total ~ 12,f4.4,370
Additional information on the City's capital assets can be found in note IV. D. on pages 40 - 42 of this report.
Debt. At year-end, the City had $423.9 million in bonds and notes outstanding as compared to $401.4 million
at the end of the prior fiscal year, an increase of 5.6%, as shown in Table 4.
Table 4
Outstanding Debt at Year-end
(in thousands)
Governmental Business-type
Activities Activities Totals
2007 2006 2007 2006 2007 2006
General obligation bonds $ 70,650 $58,743 $ 3,100 $ 3,582 $ 73,750 $ 62,325
Certificates of obligation 51,355 46,700 13,890 11,975 65,245 58,675
Revenue bonds - - 281,750 277,305 281,750 277,305
Notes - - 3,141 3,141 3,141 3,141 Total $122,005 $105,443 $301,881 $296,003 $423,886 $401,446
These amounts do not include net unamortized premiumsl(discounts) of $7,686,484 or net deferred gainl(loss)
on refunding of ($9,627,882).
n
7
CITY OF DENTON, TEXAS
MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)
SEPTEMBER 30, 2007
During the current fiscal year, the City issued debt in February 2007 and July 2007. The new debt resulted
primarily from the issuance of $41,795,000 in utility refunding revenue bonds, $15,925,000 in general
obligation bonds, $11,445,000 in certificates of obligation, and $16,740,000 in utility revenue bonds.
Moody's Investor's Service, Inc. has given the City's General Obligation Bonds and the Certifcates of
Obligation a rating of "Aa3." Standard and Poor's Corporation has given both the City's General Obligation
Bonds and Certificates of Obligation an "AA-" rating. The City's Utility Revenue Bonds carry "Al" and
"A+" ratings by Moody's and Standard and Poor's respectively. The City is permitted by Article XI, Section 5
of the State of Texas Constitution to levy taxes up to $2.50 per $100 of assessed valuation for general
governmental services including the payment of principal and interest on general obligation long-term debt. The current ratio oftax-supported debt to certified assessed value
of all taxable property is 2.50%.
Other long-term liabilities. The City maintains a self insurance program for general liability, auto liability,
public officials' liability, errors and omission liability, police professional liability, and workers' compensation.
Private insurance companies cover claims for property loss over $50,000 per occurrence and for workers'
compensation and liability over $500,000 per occurrence. The City has a reserve for claims and judgments of
$3.3 million outstanding at year-end compared with $2.9 million at the end of the prior fiscal year. Other obligations include accrued vacation pay and sick leave. More detailed
information about the City's long-term
liabilities is presented in Note IV. G., on pages 45 - 50 of this report.
ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES
All indicators are pointing to continued growth of the Denton community, and the 2007-08 Budget includes the
resources to provide City services to meet demands. The 2007-08 budget includes a $0.04/$100 valuation
increase in the ad valorem tax rate to accommodate the debt associated with the 2005 bond program and
additional drainage improvements. Sales tax revenue is projected to increase 2.0%, and the general fund
balance reserve has been increased to 15.0% of budgeted expenditures.
The 2007-08 budget includes no base rate increases for electric customers. The water budget includes a 3%
rate revenue increase for retail customers. No base rates changes are proposed for wastewater retail or
wholesale customers. Solid Waste adopted budget includes a rate increase of $0.50 per month to the single-
family residential recycling rate.
REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the City's finances for all those with an
interest in the City's finances. Questions concerning any of the information provided in this report or requests
for additional financial information should be addressed to the City of Denton Finance Department, 215 E.
McKinney, Denton, Texas 76201.
~n
1V
CITY OF DENTON, TEXAS Exhibit I STATEMENT OF NET ASSETS
SEPTEMBER 30, 2007
Primary Government
Governmental Business-type Activities Activities Total
ASSETS:
Current assets:
Cash, cash equivalents and investments, at fair value ~ 35,219,984 ~ 112,994,437 S 148,214,421
Receivables, net of allowances:
Taxes 4,424,110 - 4,424,110 Accounts - 10,495,699 10,495,699
Unbilled utility service - 8,620,054 8,620,054
Interest 587,590 1,174,890 1,762,480
Other 2,829,239 1,970 2,831,209 Internal balances (7,954,141) 7,954,141 -
Duefrom fiduciary funds 80,309 35,156 115,465
Due from other governments 1,075,398 - 1,075,398
Inventory 6,523,928 - 6,523,928 Prepaid items 140 18,310 18,450
Deferred debt issuance costs 96,629 272,082 368,711
Total current assets 42,883,186 141,566,739 184,449,925
Noncurrent assets: Restricted assets:
Cash, cash equivalents and investments,
at fair value 51,033,505 123,889,435 174,922,940 Escrow deposits 5,257 716,273 721,530
Accrued interest 222 1,270,993 1,271,215
Other receivables - 26,337 26,337
Deferred debt issuance costs 735,595 1,963,896 2,699,491 Capital assets not being depreciated:
Land 7,839,654 10,015,175 17,854,829
Construction in progress 13,868,587 34,294,162 48,162,749
Capital assets, net of accumulated depreciation: Buildings 41,766,340 4,801,695 46,568,035
Plant, machinery and equipment 20,880,854 116,624,565 137,505,419
Infrastructure 95,567,903 226,441,491 322,009,394
Landfill improvements - 253,199 253,199 `Vater rights - 57,099,088 57,099,088
Total noncurrent assets 231,697,917 577,396,309 809,094,226
Total assets 274,581,103 718,963,048 993,544,151
LIABILITIES: Current liabilities:
Accounts payable 4,674,006 19,472,465 24,146,471
Retaina~e payable 140,246 - 140,246 Deposits - 3,505,469 3,505,469
Accrued interest 808,934 - 808,934
Due to other governments 18 - 18
Noncurrent liabilities due within one year 12,696,621 20,224,590 32,921,211 Other liabilities 627,775 - 627,775
Unearned revenue 8,750 81,325 90,075
Payable from restricted assets:
Accounts payable 16,090 1,202,204 1,218,294 Retainage payable - 343,987 343,987
Accrued interest - 4,561,500 4,561,500
Total current liabilities 18,972,440 49,391,540 68,363,980
Noncurrent liabilities: Noncurrent liabilities due in more than one year 124,126,113 288,702,881 412,828,994
Total noncurrent liabilities 124,126,113 288,702,881 412,828,994
Total liabilities 143,098,553 338,094,421 481,192,974 NET ASSETS:
Invested in capital assets, net of related debt 99,858,383 242,015,614 341,873,997
Restricted:
Restricted for debt service 886,141 29,097,159 29,983,300 Restricted for capital acquisition - 1,918,029 1,918,029
Unrestricted 30,738,026 107,837,825 138,575,851
Total net assets ~ 131,482,550 ~ 380,868,627 ~ 512,351,177
The notes to the basic financial statements are an integral part of this statement.
11
1 1
CITY OF DENTON, TEXAS
STATEMENT OF ACTIVITIES FOR THE YEAR ENDED SEPTEMBER 30, 2007
Program Revenues Operating Capital
Charges for Grants and Grants and
FunctionslPrograms Expenses Services Contributions Contributions
Primary government:
Governmental activities:
General government $ 22,145,804 $ 3,694,869 $ 2,291,182 $ - Publicsafety 42,161,674 6,160,611 606,381 -
Publicworks 14,008,867 800,378 62,143 5,399,220
Parks and recreation 11,564,247 3,220,837 31,518 -
Interest expense 4,658,128 - - -
Total governmental activities 94,538,720 13,876,695 2,991,224 5,399,220
Business-type activities: Electric system 123,926,967 128,973,477 - -
Water system 25,839,614 27,830,767 - 2,246,754
Wastewater system 18,785,353 22,634,454 - 6,193,880
Solid waste 15,451,025 15,967,051 - -
Total business-type activities 184,002,959 195,405,749 - 8,440,634
Total primary government $ 278,541,679 $ 209,282,444 $ 2,991,224 $ 13,839,854
General revenues:
Taxes:
Property tax
Sales tax
Franchise fees Hotel occupancy tax
Beverage tax
Bingo tax
Investment income
Miscellaneous
Transfers Total general revenues and transfers
Change in net assets
Net assets at beginning of year
Net assets at end of year
The notes to the basic financial statements are an integral part of this statement.
17.
i r
Exhibit II
Net (Expense) Revenue and
Changes in Net Assets Primary Government
Governmental Business-type
Activities Activities Total
$ (16,159,753) $ - $ (16,159,753) (35,394,682) - (35,394,682)
(7,747,126) - (7,747,126)
(8,311,892) - (8,311,892)
(4,658,128) - (4,658,128)
(72,271,581) - (72,271,581)
- 5,046,510 5,046,510
- 4,237,907 4,237,907
- 10,042,981 10,042,981
- 516,026 516,026
- 19,843,424 19,843,424
(72,271,581) 19,843,424 (52,428,157)
34,756,356 - 34,756,356
20,653,932 - 20,653,932
15,197,943 - 15,197,943 1,268,627 - 1,268,627
294,623 - 294,623
23,708 - 23,708
3,632,744 12,108,632 15,741,376
3,199,131 548,189 3,747,320
(13,475,571) 13,475,571 - 65,551,493 26,132,392 91,683,885
(6,720,088) 45,975,816 39,255,728
138,202,638 334,892,811 473,095,449
$ 131,482,550 $ 380,868,627 ~ 512,351,177
1Z
AL V
CITY OF DENTON, TEXAS Exhibit III BALANCE SHEET
GOVERNMENTAL FUNDS
SEPTEMBER 30, 2007
Other Total
General Capital Governmental Governmental
Fund Debt Service Proiects Funds Funds ASSETS:
Cash, cash equivalents and investments,
at fair value $ 19,584,095 $ 847,804 $ 49,308,152 $ 8,725,992 $ 78,466,043 Escrow Deposits 5,257 - - - 5,257
Receivables, net of allowances
for uncollectibles: Taxes 4,155,269 268,841 - - 4,424,110
Accrued interest 162,149 - 313,712 52,881 528,742
Other 2,251,491 - 219,714 152,534 2,623,739 Interfund receivables 471,252 - - 60,611 531,863
Due from other governments - - - 1,075,398 1,075,398
Total assets ~ 26.629.513 S 1.116.645 ~ 49.841.578 ~ 10.067.416 S 87.655.152
LIABILITIES AND FUND BALANCES
LIABILITIES: Accounts payable 2,423,114 - 665,772 475,169 3,564,055
Retaina~e payable - - 133,504 6,742 140,246
Interfund parables - - - 60,611 60,611 Due to other governments 18 - - - 18
Other liabilities 627,775 - - - 627,775
Deferred revenues 1,018,796 230,504 70,692 628,783 1,948,775
Total liabilities 4,069,703 230,504 869,968 1,171,305 6,341,480
FUND BALANCES: Reserved for:
Debt service - 886,141 - - 886,141
Capital projects - - 48,971,610 - 48,971,610
Unreserved, designated for, reported in: Vehicle replacement 4,360,649 - - - 4,360,649
Unreserved, undesignated reported in:
General fund 18,199,161 - - - 18,199,161
Special revenue funds - - - 8,896,111 8,896,111 Total fund balances 22,559,810 886,141 48,971,610 8,896,111 81,313,672
Total liabilities and fund balances ~ 26.629.513 ~ 1.116.645 ~ 49.841.578 ~ 10.067.416 ~ 87.655.152
The notes to the basic financial statements are an integral part of this statement.
1d
AL T
CITY OF DENTON, TEXAS Exhibit IV
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE
STATEMENT OF NET ASSETS
AS OF SEPTEMBER 30, 2007
Total fund balances -governmental funds (Exhibit III) ~ 81,313,672
Amounts reported for governmental activities in the statement of net assets are
different because:
Capital assets used in governmental activities are not financial resources and
therefore are not reported as assets in governmental funds. 179,923,338
Certain receivables will be collected next year but are not available soon enough
to pay for the current period's expenditures and therefore are reported as
deferred revenues in the funds. 1,940,026
An internal charge to business-type activities is not recorded at the fund level. (2,571,266)
Several internal service funds are used by the City's management. The assets and
liabilities of the internal service funds are included with governmental activities.
Total assets of internal service funds ~ 23,189,963 Less: Capital assets reported above (8,587,636)
Less: Total liabilities of internal service funds (16,645,955)
Liabilities reported below 6,424,614 4,380,986
Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported as liabilities in the funds. Long-term
liabilities at year-end consist of:
General obligation bonds payable ~ (70,650,317) Certificates of obligation payable (51,355,100)
Less: Deferred charge for issuance costs 249,288
Arbitrage payable (3,335)
Accrued interest on the bonds (808,934)
Capital leases payable (2,393,684)
Compensated absences (8,542,124) (133,504,206)
Total net assets of governmental activities (Exhibit I) ~ 131,482,550
The notes to the basic financial statements are an integral part of this exhibit.
1S
AL V
CITY OF DENTON, TEXAS Exhibit V
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Other Total General Capital Governmental Governmental
Fund Debt Service Projects Funds Funds
REVENUES:
Taxes $ 45,842,915 ~ 9,791,684 $ - $ 1,268,627 ~ 56,903,226
Licenses and permits 1,097,323 - - - 1,097,323 Franchise fees 15,197,943 - - - 15,197,943
Fines and forfeitures 4,468,692 - - 596,357 5,065,049
Fees for services 4,439,570 - - 3,184,695 7,624,265
Investment revenue 1,441,299 82,748 1,810,561 298,136 3,632,744 Intergovernmental 380,887 - 1,639 3,469,987 3,852,513
Miscellaneous 529,753 - 1,999,374 477,624 3,006,751
Total revenues 73,398,382 9,874,432 3,811,574 9,295,426 96,379,814
EXPENDITURES:
Current:
General government 16,142,835 - 274,026 3,741,878 20,158,739
Public safety 36,776,654 - 74,804 862,513 37,713,971 Public works 5,561,166 - 978 62,143 5,624,287
Parks and recreation 7,312,078 - 2,690 2,919,593 10,234,361
Capital outlay 2,409,001 - 14,480,371 348,550 17,237,922
Debt service: Principal retirement 41,301 6,808,439 - - 6,849,740
Bond issuance costs - - 314,286 - 314,286
Interest and other charges - 4,389,307 - - 4,389,307
Total expenditures 68,243,035 11,197,746 15,147,155 7,934,677 102,522,613
Excess (deficiency) of revenues over (under) expenditures 5,155,347 1323 314 (11,335,581) 1,360,749 (6,142,799)
OTHER FINANCING SOURCES (USES): Issuance of long-term debt - - 24,780,000 - 24,780,000
Premium on debt issuance - - 528,630 - 528,630
Capital leases 1,108,131 - - - 1,108,131
Transfers in 5,278,998 1,769,797 2,588,960 2,685,377 12,323,132 Transfers out (4,038,781) - (431,039) (684,716) (5,154,536)
Total other financing sources (uses) 2,348,348 1,769,797 27,466,551 2,000,661 33,585,357
Net change in fund balances 7,503,695 446,483 16,130,970 3,361,410 27,442,558
Fund balances at beginning of year 15,056,115 439,658 32,840,640 5,534,701 53,871,114
Fund balances at end of year ~ 22,559,810 ~ 886,141 ~ 48,971,610 ~ 8,896,111 ~ 81,313,672
The notes to the basic financial statements are an integral part of this statement.
1~
AL V
CITY OF DENTON, TEXAS Exhibit VI
RECONCILIATION OF STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
OF GOVERNMENTAL FUNDS TO THE STATEMENT
OF ACTIVITIES
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Net change in fund balances -total governmental funds (Exhibit V) $ 27,442,558
Amounts reported for governmental activities in the statement of activities are
different because:
Governmental funds report capital outlays as expenditures. However, in the
statement of activities the cost of those assets is allocated over their
estimated useful lives and reported as depreciation expense. This is the
amount by which depreciation and retirement of assets ($14,911,525=X16,252,128 - $1,350,603 internal service portion) exceeded
capital outlays ($17,237,922) in the current period. 2,326,397
Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. Such amounts are
recorded in the funds when considered available. (210,810)
The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins and donations) is to increase net assets. 5,155,928
Bond proceeds provide current financial resources to governmental funds, but
issuing debt increases long-term liabilities in the statement of net assets. Repayment of bond principal is an expenditure in the governmental funds,
but the repayment reduces long-term liabilities in the statement of net
assets. This is the amount by which proceeds exceeded payments. (19,038,391)
Fund-level financials report costs related to bonds as expenditures; however,
these are deferred and amortized on the government-wide financials. (317,065)
Certain expenses reported in the statement of activities do not require the use
of current financial resources and therefore are not reported as expenditures
in governmental funds. (1,318,845)
Governmental funds include transfers in for the dissolution of the internal
service fund Motor Pool. As internal service fund assets are classified on the government-wide statements as governmental, the statement of activies would
not include these amounts as a change in net assets. (6,523,661)
Amounts recorded in the statement of activities include transfers out for the dissolution of the internal service fund Motor Pool to business-type activities.
Governmental funds do not report this amount. (14,332,928)
Internal service funds are used by management to charge the costs of certain activities, such as insurance and telecommunications, to individual funds.
A portion of the net revenue (expense) of certain internal service funds is
reported with governmental activities. The amount reported with
business-type activities is X103,040. 96,729
Change in net assets of governmental activities (Exhibit II) $ (6,720,088)
The notes to the basic financial statements are an integral part of this statement.
17
AL I
1
of
X0
CITY OF DENTON, TEXAS Exhibit VII
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET TO ACTUAL
GENERAL FUND
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Variance with Adjustments - Actual on a Final Budget -
Budgeted Amounts Actual Budgetary Budgetary Positive
Original Final Amounts Basis Basis (Negative)
REVENUES:
Taxes $ 45,588,821 ~ 45,588,821 ~ 45,842,915 $ - $ 45,842,915 $ 254,094
Licenses and permits 1,492,680 1,492,680 1,097,323 - 1,097,323 (395,357) Franchise fees 15,791,387 15,791,387 15,197,943 - 15,197,943
(593,444)
Fines and forfeitures 4,343,843 4,343,843 4,468,692 - 4,468,692 124,849
Fees for services 3,907,596 3,907,596 4,439,570 - 4,439,570 531,974
Investment revenue 550,000 550,000 1,441,299 - 1,441,299 891,299
Intergovernmental 363,162 363,162 380,887 - 380,887 17,725
Miscellaneous 154,599 285,081 529,753 - 529,753 244,672 Total revenues 72,192,088 72,322,570 73,398,382 - 73,398,382 1,075,812
EXPENDITURES:
Current:
General government 23,332,793 20,059,041 16,142,835 3,771,385 19,914,220 144,821
Public safety 37,654,912 36,782,059 36,776,654 - 36,776,654 5,405 Public works 6,526,281 5,768,446 5,561,166 - 5,561,166 207,280
Parks and recreation 7,484,603 7,438,752 7,312,078 - 7,312,078 126,674
Capital outlay 1,116,860 2,563,256 2,409,001 - 2,409,001 154,255
Debt service:
Principal retirement 41,301 41,301 41,301 - 41,301 - Total expenditures 76,156,750 72,652,855 68,243,035 3,771,385 72,014,420 638,435
Excess (deficiency) of revenues
over expenditures (3,964,662) (330,285) 5,155,347 (3,771,385) 1,383,962 1,714,247
OTHER FINANCING SOURCES
(USES): Capital leases - - 1,108,131 - 1,108,131 1,108,131
Transfer in 5,106,792 4,976,310 5,278,998 3,771,385 9,050,383 4,074,073
Transfers out (742,446) (4,246,341) (4,038,781) - (4,038,781) 207,560
Total other financing
sources (uses) 4,364,346 729,969 2,348,348 3,771,385 6,119,733 5,389,764
Excess (deficiency) of revenues
and other sources over (under)
expenditures and other uses 399,684 399,684 7,503,695 - 7,503,695 7,104,011
Fund balances at beginning of year 15,056,115 15,056,115 15,056,115 - 15,056,115 - Fundbalance at end of year $ 15,455,799 ~ 15,455,799 ~ 22,559,810
$ - $ 22,559,810 $ 7,104,011
Adjustments -Budgetary Basis are expenditures allocated to and reimbursed by other funds. These
expenditures are recorded in the other funds' financials.
The notes to the basic financial statements are an integral part of this statement.
14
AL /
CITY OF DENTON, TEXAS
STATEMENT OF NET ASSETS PROPRIETARY FUNDS
AS OF SEPTEMBER 30, 2007
Business-type Activities -Enterprise Funds
Electric Water Wastewater Solid System System System Waste
ASSETS:
Current assets:
Cash, cash equivalents and investments,
at fair value ~ 78,509,502 $ 19,615,484 ~ 7,752,223 $ 7,117,228
Receivables, net of allowances: Accounts 6,876,626 1,594,954 1,140,402 883,717
Unbilled utility service 5,878,927 1,168,208 901,675 671,244
Accrued interest 783,341 211,883 116,983 62,683
Other - 1,970 - -
Interfundreceivables 486,759 91,843 189,644 13,706
Merchandise inventory - - - - Prepaiditems 14,375 - 3,935 -
Deferreddebt issuance costs 83,566 111,082 55,789 21,645
Total current assets 92,633,096 22,795,424 10,160,651 8,770,223
Noncurrent assets:
Restricted assets:
Cash, cash equivalents and investments, at fair value 36,564,844 54,034,427 26,224,966 7,065,198
Escrow deposit 126,311 97,696 57,692 434,574
Accrued interest 492,610 439,858 206,613 131,912
Other receivables - 26,337 - -
Interfundreceivables 4,321,244 209,542 105,293 -
Deferreddebt issuance costs 575,891 964,061 318,605 105,339 Capital assets, net of accumulated depreciation 100,383,585 185,169,551 142,353,969 21,622,270
Total noncurrent assets 142,464,485 240,941,472 169,267,138 29,359,293
Total assets 235,097,581 263,736,896 179,427,789 38,129,516
LIABILITIES:
Current liabilities:
Accounts payable 18,611,735 251,384 303,597 305,749 Claims payable - - - -
Compensated absences payable 467,766 494,647 241,549 240,500
Leases payable - - 135,929 1,043,641
Deposits 3,239,502 224,819 - 41,148
Accrued interest - - - -
Interfund payables - - - - Unearned revenue 81,325 - - -
Payable from restricted assets:
Accounts payable 52,084 319,933 410,449 419,738
Retainage payable - 228,649 97,125 18,213
Accrued interest 1,356,773 2,148,593 951,113 105,021 Revenue and certificate and general
obligation bonds 5,496,141 5,926,483 4,125,689 2,052,245
Total current liabilities paid from restricted
assets 6,904,998 8,623,658 5,584,376 2,595,217
Total current liabilities 29,305,326 9,594,508 6,265,451 4,226,255
~n
Amd v
Exhibit VIII
Governmental
Activities -
Total Internal
Enterprise Service Funds Funds
$ 112,994,437 $ 6,909,897
10,495,699 -
8,620,054 -
1,174,890 58,848
1,970 205,500
781,952 4,686
- 6,523,928 18,310 140
272,082 5,119
134,359,394 13,708,118
123,889,435 877,549
716,273 -
1,270,993 222
26,337 -
4,636,079 -
1,963,896 16,438 449,529,375 8,587,636
582,032,388 9,481,845
716,391,782 23,189,963
19,472,465 1,109,951 - 437,500
1,444,462 226,488
1,179,570 442,279
3,505,469 -
- 25,640
- 5,778,504 81,325 -
1,202,204 16,090
343,987 -
4,561,500 -
17,600,558 469,732
23,708,249 485,822
49,391,540 8,506,184
(continued)
7.1
itl 1
CITY OF DENTON, TEXAS
STATEMENT OF NET ASSETS
PROPRIETARY FUNDS AS OF SEPTEMBER 30, 2007
Business-type Activities -Enterprise Funds
Electric Water Wastewater Solid
System System System Waste
Noncurrent liabilities:
Leases payable $ - $ - $ 190,098 ~ 2,522,096
Payable from restricted assets:
Arbitrage payable 24,692 5,525 17,037 -
Generalobligation bonds payable - - - 2,670,243 Certificates of obligation - - - 12,323,127
Revenue bonds payable, net of premiumldiscount 82,753,134 133,623,217 56,606,213 -
Deferred amount on refunding (2,645,894) (5,226,934) (1,370,727) (96,130)
Notes payable - 3,141,222 - -
Compensated absences payable 50,915 35,444 30,008 75,133
Claims payable - - - -
Landfill closurelpostclosure costs - - - 3,974,462
Total noncurrent liabilities 80,182,847 131,578,474 55,472,629 21,468,931 Total liabilities 109,488,173 141,172,982 61,738,080 25,695,186
NET ASSETS:
Invested in capital assets, net of related debt 42,769,813 90,349,270 100,597,301 8,299,230
Restricted for debt service 10,737,987 12,375,006 5,984,166 -
Restricted for capital acquisition - 820,101 1,097,928 -
Unrestricted 72,101,608 19,019,537 10,010,314 4,135,100
Total net assets $125,609,408 $122,563,914 $117,689,709 ~ 12,434,330
Adjustment to reflect inclusion of internal service fund activities related to enterprise funds.
Net assets of business-type activities (Exhibit I)
The notes to the basic financial statements are an integral part of this statement.
Exhibit VIII
Governmental
Activities -
Total Internal
Enterprise Service
Funds Funds
$ 2,712,194 ~ 884,574
47,254 -
2,670,243 53,312 12,323,127 4,292,209
272,982,564 -
(9,339,685) -
3,141,222 -
191,500 30,380
- 2,879,296
3,974,462 -
288,702,881 8,139,771 338,094,421 16,645,955
242,015,614 3,344,636
29,097,159 -
1,918,029 -
105,266,559 3,199,372
$ 378,297,361 $ 6,544,008
2,571,266
$ 380,868,627
(concluded)
v
CITY OF DENTON, TEXAS
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS
PROPRIETARY FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Business-type Activities -Enterprise Funds
Electric Water Wastewater Solid
System System System Waste
OPERATING REVENUES:
Utility services $ 124,727,137 $ 20,624,118 $ 20,103,918 $ 15,809,048
Charges for goods and services - - - -
Otherfees 4,246,340 3,057,387 1,088,519 158,003
Miscellaneous - - 32,294 - Totaloperating revenues 128,973,477 23,681,505 21,224,731 15,967,051
OPERATING EXPENSES:
Operating expenses before depreciation 116,650,348 15,167,255 11,073,000 11,796,867
Depreciation 4,255,715 5,033,989 5,087,019 2,910,127
Total operating expenses 120,906,063 20,201,244 16,160,019 14,706,994
Operating income 8,067,414 3,480,261 5,064,712 1,260,057
NON-OPERATING REVENUES (EXPENSES): Investment revenue 5,934,612 3,623,792 1,831,738 718,490
Interest expense and fiscal charges (3,049,271) (5,665,918) (2,641,555) (774,935)
Impact fee revenue - 4,149,262 1,409,723 -
Gain (loss) on disposal of capital assets (45,703) (120,160) (9,220) 319,857
Other non-operating revenues (expenses) - 136,107 28,634 238,674
Total non-operating revenues (expenses) 2,839,638 2,123,083 619,320 502,086
Income before contributions and transfers 10,907,052 5,603,344 5,684,032 1,762,143
CONTRIBUTIONS AND TRANSFERS:
Capital contributions - 2,246,754 6,193,880 -
Transfers in 5,154,417 3,102,983 3,901,029 2,486,595 Transfers out (74,829) (109,863) (923,197) (61,564)
Total contributions and transfers 5,079,588 5,239,874 9,171,712 2,425,031
Change in net assets 15,986,640 10,843,218 14,855,744 4,187,174
Total net assets at beginning of year 109,622,768 111,720,696 102,833,965 8,247,156
Total net assets at end of year $ 125,609,408 $ 122,563,914 $ 117,689,709 $ 12,434,330
Change in fund net assets of proprietary funds
Adjustment to reflect inclusion of internal service fund activities related to enterprise funds.
Change in net assets of business-type activities (Exhibit II)
The notes to the basic financial statements are an integral part of this statement.
7d
Exhibit IX
Governmental
Activities - Total Internal
Enterprise Service
Funds Funds
$ 181,264,221 $ -
- 18,767,700
8,550,249 -
32,294 295,628 189,846,764 19,063,328
154,687,470 17,875,080
17,286,850 1,350,603
171,974,320 19,225,683
17,872,444 (162,355)
12,108,632 361,451
(12,131,679) (211,748)
5,558,985 -
144,774 -
403,415 -
6,084,127 149,703
23,956,571 (12,652)
8,440,634 -
14,645,024 212,422 (1,169,453) (24,233,126)
21,916,205 (24,020,704)
45,872,776 (24,033,356)
332,424,585 30,577,364
$ 378,297,361 $ 6,544,008
45,872,776
103,040
$ 45,975,816
~S
itl V
CITY OF DENTON, TEXAS
STATEMENT OF CASH FLOWS PROPRIETARY FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Business-type Activities -Enterprise Funds Electric Water Wastewater
System System System
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers $ 131,199,927 ~ 23,968,104 ~ 21,316,526 Cash paid to employees for services (5,959,780) (9,155,896) (4,638,448)
Cash paid to suppliers (115,521,194) (6,610,552) (6,035,806)
Net cash provided by operating activities 9,718,953 8,201,656 10,642,272
CASH FLOWS FROM NONCAPITAL FINANCING
ACTIVITIES: Transfers out (74,829) (109,862) (923,197)
Transfers in 5,154,417 3,102,983 3,901,029
Net cash used by noncapital financing activities: 5,079,588 2,993,121 2,977,832
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Principal payments on capital debt (5,321,239) (5,146,586) (3,530,246) Interest and fiscal charges (2,978,544) (5,897,696) (2,680,390)
Principal payments under capital lease obligation - - (130,340)
Proceeds from issuance of capital debt 7,051,915 9,692,632 -
Proceeds from impact fees - 4,149,262 1,409,723
Proceeds from sale of capital assets - - - Acquisition and construction of capital assets (13,442,379) (6,312,592) (7,064,986)
Net cash used by capital financing activities (14,690,247) (3,514,980) (11,996,239)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale and maturities of investment securities 295,130,509 39,859,562 25,754,151
Purchase of investment securities (300,359,367) (46,255,000) (22,562,000) Interest received on investments 5,473,772 3,473,212 1,731,207
Net cash provided (used) by investing activities 244,914 (2,922,226) 4,923,358
Net increase (decrease) in cash and cash equivalents 353,208 4,757,571 6,547,223
Cash and cash equivalents at beginning of year 10,353,381 1,350,316 1,618,430
Cash and cash equivalents at end of year 10,706,589 6,107,887 8,165,653
Investments, at fair value (Note IV.A.) 104,367,757 67,542,024 25,811,536
Cash, cash equivalents and investments, at fair value ~ 115,074,346 ~ 73,649,911 ~ 33,977,189
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES:
Operating income $ 8,067,414 ~ 3,480,261 ~ 5,064,712
Adjustments: Depreciation expense 4,255,715 5,033,989 5,087,019
Decrease (Increase) in receivables 3,224,274 19,541 58,605
Decrease (Increase) in interfund receivables (997,824) 267,059 33,190
Increase in inventories - - -
Decrease (Increase) in prepaid items (13,422) 2,170 5,509 Increase (Decrease) in accounts payable (4,800,863) (226,342) 485,433
Increase (Decrease) in compensated absences payable 51,323 36,242 (14,212)
Increase in closure/postclosure liability - - -
Increase (Decrease) in interfund payables (67,664) (411,264) (77,984) Total adjustments 1,651,539 4,721,395 5,577,560
Net cash provided by operating activities $ 9,718,953 $ 8,201,656 $ 10,642,272
NONCASH CAPITAL, INVESTING AND FINANCING ACTIVITIES:
Noncash activity during the year consisted of contributed capital assets for the Water and Wastewater funds in the amounts
of $2,246,754 and X6,193,880, respectively; the change in the fair value of investments of X1,668,600, X664,497,
$377,645 and $122,447 for the Electric, Water, Wastewater and Solid Waste funds, respectively; the addition of capital leases in Solid Waste and the Internal Service funds of $1,313,791
and $1,547,995, respectively;
and the change in fair value of investments of $226,862 for the Internal Service funds.
The notes to the basic financial statements are an integral part of this statement.
Amd v
Exhibit X
Governmental
Activities
Total Internal Solid Enterprise Service
Waste Funds Funds
$ 15,575,560 ~ 192,060,117 $ 19,336,778 (6,923,301) (26,677,425) (3,745,944)
(5,334,308) (133,501,860) (13,521,202)
3,317,951 31,880,832 2,069,632
(61,564) (1,169,452) (24,233,126)
2,486,595 14,645,024 212,422
2,425,031 13,475,572 (24,020,704)
(1,167,905) (15,165,976) (4,780,786) (757,730) (12,314,360) (203,919)
(851,429) (981,769) (1,846,117)
2,631,889 19,376,436 15,705,581
- 5,558,985 -
319,857 319,857 (4,371,496) (31,191,453) (713,107)
(4,196,814) (34,398,280) 8,161,652
6,958,623 367,702,845 14,048,280
(8,300,000) (377,476,367) (900,000) 627,200 11,305,391 402,112
(714,177) 1,531,869 13,550,392
831,991 12,489,993 (239,028)
1,365,106 14,687,233 2,843,911
2,197,097 27,177,226 2,604,883
11,985,329 209,706,646 5,182,563
~ 14,182,426 ~ 236,883,872 ~ 7,787,446
~ 1,260,057 $ 17,872,444 ~ (162,355)
2,910,127 17,286,850 1,350,603
(549,091) 2,753,329 (91,973)
157,601 (539,974) 365,424
- - (2,490,582) - (5,743) 30,606
272,269 (4,269,503) 772,427
2,527 75,880 43,156
285,054 285,054
(1,020,593) (1,577,505) 2,252,326 2,057,894 14,008,388 2,231,987
$ 3,317,951 $ 31,880,832 $ 2,069,632
7.7
itl
CITY OF DENTON, TEXAS Exhibit XI
STATEMENT OF ASSETS AND LIABILITIES AGENCY FUNDS
AS OF SEPTEMBER 30, 2007
Total
Agency
Funds
ASSETS:
Cash, cash equivalents and investments,
at fair value ~ 1,530,883 Interfund receivables 49
Other receivables 195,487
Total assets ~ 1,726,419
LIABILITIES:
Accounts payable ~ 1,610,903
Interfund payables 115,516 Total liabilities ~ 1,726,419
The notes to the basic financial statements are an integral part of this statement.
~A
Amd v
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS
SEPTEMBER 30, 2007
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Denton is a municipal corporation governed by an elected mayor and six-member council. The
City receives funding from state and federal government sources and must comply with the requirements of these funding source entities. However, the City is not included in any
other governmental "reporting entity,"
as defined in pronouncements by the Governmental Accounting Standards Board (GASH) Statement No. 14,
"The Financial Reporting Entity," since council members are elected by the public and have decision-making
authority, the authority to levy taxes, the power to designate management, the ability to significantly influence
operations, and primary accountability for fiscal matters.
The financial statements of the City have been prepared to conform to accounting principles generally accepted
(GAAP) in the United States of America as applicable to state and local governments. GASH is the accepted
standard-setting body for establishing governmental accounting and financial reporting principles. The
following is a summary of the more significant policies.
A. Reporting entity
An elected mayor and asix-member council govern the City. As required by accounting principles generally
accepted in the United States of America, these financial statements present the City (the primary government)
and its component units, which are 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 primary government. A discretely presented component
unit, on the other hand, is reported in a separate column in the government-wide financial statements to
emphasize it is legally separate from the City. The City had no discretely presented or blended component units
at September 30, 2007.
B. Government-wide and fund financial statements
The basic financial statements include both government-wide (based on the City as a whole) and fund financial
statements. The reporting focus is either the City as a whole (government-wide financial statements) or major
individual funds (within the fund financial statements). The government-wide financial statements (i.e., the statement of net assets and the statement of activities) report
information on all non-fiduciary activities of the
primary government. For the most part, the effect of inter-fund activity has been removed from these
statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues,
are reported separately from business-type activities, which rely to a significant extent on fees and charges for
support.
The government-wide statement of activities demonstrates the degree to which the direct expenses of a
functional category (public safety, public works, etc.) or segment are offset by program revenues. Direct
expenses are those that are clearly identifiable with a specific function or segment. Program revenues include
(1) charges to customers or applicants who purchase, use or directly benefit from goods, services or privileges
provided by a given function or segment; (2) grants and contributions that are restricted to meeting operational
requirements of a particular function or segment; and (3) grants and contributions that are restricted to meeting
the capital requirements of a particular function or segment. Taxes and other items not properly included
among program revenues are reported instead as general revenues.
The net cost (by function or business-type activity) is normally covered by general revenue (property taxes,
sales taxes, franchise fees, interest income, etc.).
Separate fund financial statements are provided for governmental funds, proprietary funds, and fiduciary funds,
even though the latter are excluded from the government-wide financial statements. Major governmental funds
and major enterprise funds are reported as separate columns in the fund financial statements. GASH Statement
No. 34 sets forth minimum criteria (percentage of assets, liabilities, revenues or expenditureslexpenses of either
fund category and for the governmental and enterprise funds combined) for the determination of major funds.
Non-major funds are combined in a column in the fund financial statements.
~n
G7
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
Internal service funds, which traditionally provide services primarily to other funds of the government, are
presented in summary form as part of the proprietary fund financial statements. The financial statements of
internal service funds are allocated (based on the percentage of goods or services provided) between the
governmental and business-type activities when presented at the government-wide level.
The City's fiduciary funds are presented in the fund financial statements. Since by definition these assets are
being held for the benefit of a third party (other local governments, individuals, etc.) and cannot be used to
address activities or obligations of the government, these funds are not incorporated into the government-wide
statements.
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 of the fiscal period. The focus of the fund financial statements is
on the major individual funds of the governmental and business-type categories, as well as the fiduciary funds
(by category). Each presentation provides valuable information that can be analyzed and compared to enhance
the usefulness of the information.
C. Measurement focus, basis of accounting and financial statement presentation
The government-wide financial statements are reported using the economic resources measurement focus and
the accrual basis of accounting, as are the proprietary fund statements. Revenues are recorded when earned,
and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are
levied. Grants and similar items are recognized
as revenue as soon as all eligibility requirements imposed by the provider have been met.
Governmental fund-level financial statements are reported using the current financial resources measurement
focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both
measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current
period. For this purpose, the government
considers revenues to be available if they are collected within 60 days of the end of the current fiscal period.
Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt
service expenditures, as well as expenditures related to compensated absences and claims and judgments, are
recorded only when payment is due.
Property tax, franchise fees, sales tax and other taxes associated with the current fiscal period are all susceptible
to accrual and so have been recognized as revenues of the current fiscal period. All of the other revenue items
are considered to be measurable and available only when cash is received.
The City reports the following major governmental funds:
The general fund is the City's primary operating fund. All general tax revenues and other receipts that are
not allocated by law or contractual agreement to some other fund are accounted for in this fund. From the
fund are paid general operating costs, fixed charges and capital improvement costs that are not paid
through other funds.
The debt service fund accounts for the payment of principal and interest on general long-term liabilities, paid primarily by taxes levied by the City, and for payment of principal
and interest on capital leases in the
governmental funds.
The capital projects fund accounts for financial resources used for the acquisition or construction of major
capital facilities being financed from bond proceeds, capital contributions, or transfers from other funds,
other than those recorded in the enterprise funds and internal service funds.
Other governmental funds is a summarization of all of the non-major governmental funds.
~n
JV
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
The City reports the following major proprietary funds:
The City utility system is made up of three separate funds as follows:
The electric fund accounts for electrical utility services to the residents and commercial establishments
of the City. Activities necessary to provide such services are accounted for in the fund, including, but
not limited to, administration, operations, maintenance, finance and related debt service.
The water fund accounts for water utility services to the residents and commercial establishments of the
City. Activities necessary to provide such services are accounted for in the fund, including, but not
limited to, administration, operations, maintenance, finance and related debt service.
The wastewater fund accounts for sewer and storm water services to the residents and commercial
establishments of the City. Activities necessary to provide such services are accounted for in the fund,
including, but not limited to, administration, operations, maintenance, finance and related debt service.
The City provides additional services through the following fund:
The solid waste fund accounts for the provision of solid waste services to the residents of the City.
Activities necessary to provide such services are accounted for in the fund, including, but not limited to,
administration, operations, maintenance, finance and related debt service.
The City additionally reports the following funds:
Internal service funds are used to account for the financing of materials and services provided by one
department of the City to other departments of the City on acost-reimbursement basis.
Agency funds are used to account for the payment of payroll, employee insurance, and other similar
liabilities. The City holds the assets in an agency capacity for individuals, private organizations or other
governments.
The City follows private-sector standards of accounting and financial reporting (as issued by the Financial Accounting Standards Board) issued prior to December 1, 1989
in both the government-wide and proprietary
fund financial statements to the extent that those standards do not conflict with or contradict guidance of the
GASB. Governments also have the option of following subsequent private-sector guidance for business-type
activities and enterprise funds, subject to this same limitation.
Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues
and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating
revenues of the City's electric, water,
wastewater and solid waste funds are charges to customers for services. Operating expenses for the enterprise
funds and internal service funds include the cost of sales and services, administrative expenses and depreciation
on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues
and expenses. For deferred charges, the City recognizes, as an asset or a liability, the difference between the
electric fund's energy cost adjustment (ECA) revenue collected and related costs, in compliance with Financial
Accounting Standards Board Statement No. 71.
When both restricted and unrestricted resources are available for use, it is the City's policy to use restricted
resources first, then unrestricted resources as they are needed.
J1
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
D. Assets, liabilities and net assets or equity
1. Cash, cash equivalents and investments
The City's cash and cash equivalents are considered to be cash on hand, demand deposits and short-term
investments with original maturities of three months or less from the date of acquisition.
Investments are carried at fair value or cost, if maturities are one year or less. Fair value is determined as
the price at which two willing parties would complete an exchange. Interest earned on investments is
recorded in the funds in which the investments are recorded.
2. Receivables
Outstanding balances between funds are reported as "interfund receivables/payables." Any residual
balances between governmental activities and business-type activities are reported in the government-wide statements as "internal balances."
Trade and property tax receivables are shown net of an allowance for uncollectibles. The City accrues
amounts for utility services provided in September, but not billed at September 30, 2007.
3. Inventories
Inventories of supplies are maintained at the City warehouse for use by all City funds and are accounted for
by the consumption method. Cost is determined using a moving average method. No inventories exist in
the governmental fund types.
4. Restricted Assets
Certain proceeds of the City's governmental and proprietary fund revenue bonds, general obligation bonds,
and certificates of obligation, as well as certain resources set aside for their repayment, are classified as restricted assets on the balance sheet because their use is limited
by applicable bond covenants. Assets
collected from impact fees are limited by state statute in use and also shown as restricted on the balance
sheet of the Water and Wastewater funds.
5. Capital Assets
Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads, bridges,
sidewalks and similar items) are reported in applicable governmental or business-type activities columns in
the government-wide financial statements and in the proprietary fund financial statements. The City
defines capital assets as assets with an initial, individual cost of more than $5,000 and an estimated useful
life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if
purchased or constructed. Donated capital assets are recorded at estimated fair value at the time received.
Major outlays for capital assets and improvements are capitalized as projects are constructed. Net interest
incurred during the construction phase of capital assets of business-type activities and enterprise funds is
included as part of the capitalized value of the assets constructed. For 2007, net interest capitalization of
$754,863 was recorded for electric fund projects, $217,724 was recorded for water fund projects and
$15 8,218 was recorded for wastewater fund proj ects.
JG
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
Capital assets are depreciated using the straight-line method over the following useful lives:
Assets Years
Buildings 40
Infrastructure 20 - 40
General improvements 10
Machinery and equipment 10 - 20
Furniture and office equipment 10
Computer equipment/software 3 -10
Plant and equipment 5
Underground pipe 40
Water storage rights 50 -100
Water recreation rights 50
Communication equipment 5
Vehicles 3 -10
Renewals and betterments of property and equipment are capitalized, whereas normal repair and
maintenance are charged to expense as incurred.
6. Compensated Absences
The City allows employees to accumulate unused vacation up to 320 hours (480 for Civil Service Fire
employees.) Upon termination, any accumulated vacation time will be paid to an employee. Generally,
sick leave is not paid upon termination except for fire fighters and police officers. Firefighters and police
officers accumulate unused sick leave up to a maximum of 1080 hours and 720 hours, respectively. All other employees are paid only upon illness while in the employ of the City.
Accumulated vacation and sick
leave is accrued when incurred in the government-wide, proprietary and fiduciary fund financial statements.
A liability for these amounts is reported in governmental funds only if they have matured, for example, as a
result of employee resignations and retirements. The General Fund has been used in prior years to liquidate
governmental funds' related liability.
7. Arbitra e
Arbitrage involves the investment of the proceeds from the sale oftax-exempt securities in a taxable money
market instrument that yields a higher rate, resulting in interest revenue in excess of interest costs. Federal
tax code requires that these excess earnings be rebated to the federal government. The Capital Projects
Fund has been used in prior years to liquidate governmental funds' related liability.
8. Lon -term obli atg ions
In the government-wide financial statements and proprietary fund types in the fund financial statements,
long-term obligations are reported as liabilities. Bond premiums and discounts, as well as issuance costs,
are deferred and amortized over the life of the bonds. Bonds payable are reported net of the applicable
bond premium or discount. Gains and losses on refunding are amortized over the life of the refunded debt or the life of the new issue, whichever is shorter.
In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well
as bond issuance costs, during the current period. The face amount of debt issued is reported as other
financing sources. Premiums received on debt issuances are reported as other financing sources while
discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld
from the actual debt proceeds received, are reported as debt service expenditures.
JJ
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
9. Fund e ui
In the fund financial statements, governmental funds report reservations of fund balance for accounts that
are not available for appropriation or are legally restricted by outside parties for use for a specific purpose. Designations of fund balances represent management plans that
are subject to change.
II. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
Explanation of certain differences between the governmental fund statement of revenues, expenditures and changes in fund balances and the government-wide statement of activities
Another element of that reconciliation states, "Bond proceeds provide current financial resources to
governmental funds, but issuing debt increases long-term liabilities in the statement of net assets. Repayment
of bond principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in
the statement of net assets. This is the amount by which proceeds exceeded payments." The details of this
$(19,03 8,391) difference are as follows.
Debt issued or incurred:
Issuance of general obligation debt $(15,925,000)
Issuance of certificates of obligation (8,855,000)
Issuance of capital lease debt (1,108,131)
Principal repayments:
Principal retirement 6,849,740
Net adjustment to decrease net changes in fund balances -total
governmental funds to arrive at changes in net assets of governmental activities 19 03 8 3 91
Another element of that reconciliation states, "The net effect of various miscellaneous transactions involving
capital assets (i.e., sales, trade-ins and donations) is to increase net assets." The details of this $5,155,928
difference are as follows:
Loss on disposal of capital assets $ (241,653)
Donations of capital assets increase net assets in the statement of 5,397,581
activities but do not appear in the governmental funds because
they are not financial resources
Net adjustment to increase net changes in fund balances -total 5 155 928 governmental funds
Another element of that reconciliation states, "Certain expenses reported in the statement of activities do not
require the use of current financial resources and therefore are not reported as expenditures in governmental funds." The details of the $(1,318,845) difference are as follows:
Compensated absences $(1,175,3 78)
Arbitrage liability 22,633
Accrued interest 166100
Net adjustments to decrease net changes in fund balances -total
governmental funds to arrive at changes in net assets of
governmental activities 1318 845
,I-t
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
III. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
A. Budgetary information
The City Council follows these procedures, as prescribed by City Charter, in establishing the budgets reflected
in the financial statements:
1. Within the time period required by law, the City Manager submits to the City Council a proposed budget
for the fiscal year beginning on the following October 1. The operating budget includes proposed
expenditures and the means of financing them.
2. Public hearings are conducted prior to the adoption of the budget in order to obtain taxpayer comments.
3. The annual budget adopted by the City Council covers the general fund, special revenue funds
(Recreation Fund, Police Confiscation Fund, and Tourist and Convention Fund only), the debt service
fund, the enterprise funds, and internal service funds. The budget is legally enacted by the City Council
through passage of an ordinance prior to the beginning of the fiscal year. The basic financial statements
reflect the legal level of control, (i.e. the level at which expenditures cannot legally exceed the
appropriated amount) which is established by function activity within an individual fund as approved by
City Council.
4. The City Charter provides that the City Manager has the authority to transfer any unencumbered
appropriation balances from one appropriation to another within a single function (office, department, or
agency). City Council approval is not required at this level. The Charter also provides that at any time
during the year, at the request of the City Manager, City Council may by resolution transfer any part of
the unencumbered appropriation balances or the entire balance thereof between functions, as well as
make any increases in fund appropriations.
Budgets are adopted on a basis for the governmental funds and the budgeted special revenue funds that is
generally consistent with generally accepted accounting principles. Budgets for enterprise funds are prepared
on the full accrual basis, except certain noncash transactions such as depreciation expense and amortization on
debt issuance costs where it is not budgeted, and debt service payments where it is budgeted. At the beginning of the subsequent year, management reviews all open encumbrances from
the prior year and, as provided in the
budget ordinance, appropriations for the encumbrances may be carried forward. In the current fiscal year, no
appropriations were carried forward. Also, during the budgetary process, amounts are included in all fund
budgets to recognize administrative transfers between funds for goods or services. These amounts are not
included in the reporting of actual activity for the funds. For funds reporting required budget-to-actual
comparisons, these administrative transfers are included as adjustments -budgetary basis.
B. Deficit fund equity
The Criminal Justice special revenue fund had a deficit fund balance of $(77,270) at September 30, 2007. This
deficit was a result of the reimbursement timing. Elimination of the deficit fund balance is anticipated in 2008.
IV. DETAILED NOTES ON ALL FUNDS
A. Deposits and investments
In order to facilitate effective cash management practices, the operating cash of all funds is pooled into common
accounts for the purpose of increasing income through combined investment activities. At year-end, the City
had $47,982,883 in cash and cash equivalents, including $31,174,367 invested in money market funds that the City considers cash equivalent. Of the $47,982,883, agency funds reported
$1,530,883. In addition, the City
had $12,993 in petty cash at year-end.
Statutes authorize the City to invest in obligations of the U.S. Treasury; U.S. agencies, fully collateralized
repurchase agreements, public fund investment pools, SEC-registered, no-load, money market mutual funds,
investment-grade, rated municipal securities of any state and fully collateralized certificates of deposit. The investments reported at September 30, 2007, were similar to those
held during the fiscal year.
JJ
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
The City reports all investments in the financial statements at fair value. At September 30, 2007, the City's
investments carried a fair value of $276,672,368. As of September 30, 2007, City investments were as follows:
Weighted Average
Investment Type Fair Value Maturity (Years)
U.S. Treasury Securities $ 28,735,966 1.12
U.S. Agency Securities-Coupon 149,132,287 0.77
U.S. Agency Securities-Callable 74,098,997 0.92
U.S. Agency Securities-Discount 9,708,000 0.66
U.S. Agency Securities-Step-Up 14,997,118 0.89
Total fair value of investments $ 276,672,368
Portfolio weighted average maturity 0.76
Interest rate risk. In accordance with its investment policy, the City manages its exposure to declines in fair
values due to interest rate fluctuations by limiting the weighted average maturity of its investment portfolio to
less than eighteen months. With review and approval of the City's investment committee, the weighted average
maturity of its investment portfolio maybe extended beyond eighteen months.
Credit risk. The City's investment policy limits investments to obligations of the United States of America and
its agencies, investment quality obligations of the States with a rating not less than AA, fully insured
Certificates of Deposit, and commercial paper that has a maturity of 270 days or less and a rating of A-1 or P- l .
The City's investments in the bonds of U.S. agencies were rated AAA by Standard & Poor's and Fitch Ratings
and Aaa by Moody's Investors Service.
Custodial credit risk. This is the risk that in the event of a bank or counterparty failure, the City's deposits may
not be returned. The policy states that all bank deposits and bank investments of City funds shall be secured by
pledged collateral with a market value equal to no less than 102 percent of the principal plus accrued interest
less an amount insured by FDIC, if a deposit. As of September 30, 2007, the bank balance for deposits was $3,354,570 which was insured by FDIC for $100,000 and covered by collateral
with a fair value of $6,842,791
held by an independent third party custodian pledged for the City, but not in the City's name.
JU
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
Cash, cash equivalents and investments, at fair value are reported together on the financial statements.
Investments, at fair value, by fund were as follows:
Other
General Capital Governmental
Fund Projects Funds Electric
Unrestricted investments $ 18,794,547 $ 38,710,127 $ 4,176,598 $ 66,888,143
Change in fair value 2,483 75,145 24,259 (242,757)
Restricted investments - - - 37,663,721
Change in fair value - - - 58,650
Total $ 18,797,030 $ 38,785,272 $ 4,200,857 $ 104,367,757
Internal Total
Service City
Water Wastewater Solid Waste Funds Investments
Unrestricted investments $ 18,206,148 $ 5,922,576 $ 5,499,985 $ 4,805,203 $ 163,003,327
Change in fair value 94,471 86,451 3,257 (19,765) 23,544
Restricted investments 49,365,535 19,878,600 6,406,628 400,000 113,714,484
Change in fair value (124,130) (76,091) 75,459 (2,875) (68,987)
Total $ 67,542,024 $ 25,811,536 $ 11,985,329 $ 5,182,563 $ 276,672,368
B. Property tax revenue
Property taxes attach as an enforceable lien on property as of January 1. Taxes are levied on October 1 and are
due and payable at that time; therefore, the legally enforceable claim arises on October 1. A receivable is
recorded at that time. All unpaid taxes levied October 1 become delinquent February 1 of the following year.
Property taxes at the fund level are recorded as receivables and revenue at the time the tax levy is billed.
Current-year revenues recognized are those ad valorem taxes collected within the current period or soon enough thereafter to pay current liabilities, which is sixty days after year-end.
All other outstanding receivables are
adjusted from revenue and recognized as deferred for future collections. Current tax collections for the year
ended September 30, 2007, were 98.7% of the tax levy. An allowance is provided for delinquent taxes not
expected to be collected in the future.
At September 30, 2007, the City had a tax rate of $0.62652 per $100 valuation. Based upon the maximum ad
valorem tax of $2.50 per $100 valuation imposed by Texas Constitutional law, the City had a tax rate margin of
$1.87348. Additional revenues up to $101,940,335 could be raised per year based on the current year's assessed
value of $5,441,228,909 before the limit is reached.
J/
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
C. Receivables
Receivables at September 30, 2007, for the City's individual major funds and other funds (non-major funds,
internal service funds and fiduciary funds), including the applicable allowances for uncollectible accounts, are
shown below.
Capital
General Debt Service Projects Electric Water
Receivables:
Taxes $4,460,129 $ 3 75,110 $ - $ - $ -
Accounts - - - 18,800,140 3,027,975 Accrued interest 162,149 - 313,712 1,275,951 651,741
Unbilled utility service - - - 5,878,927 1,168,208
Other 9,136,134 - 219,714 - 28,307
Gross receivables 13,758,412 375,110 533,426 25,955,018 4,876,231
Less: Allowance for
uncollectibles 7,189,503 106,269 - 11,923,514 1,433,021
Net total receivables $6,568,909 $ 268,841 $ 533,426 $ 14,031,504 $ 3,443,210
Other Internal
Waste- Solid Governmental Service
water Waste Funds Funds Total Receivables:
Taxes $ - $ - $ - $ - $ 4,835,239
Accounts 2,801,888 2,146,014 - - 26,776,017
Accrued interest 323,596 194,595 52,881 59,070 3,033,695
Unbilled utility service 901,675 671,244 - - 8,620,054
Other - - 152,534 205,500 9,742,189
Gross receivables 4,027,159 3,011,853 205,415 264,570 53,007,194
Less: Allowance for
uncollectibles 1,661,486 1,262,297 - - 23,576,090
Net total receivables $2,365,673 $ 1,749,556 $ 205,415 $ 264,570 $ 29,431,104
~Q
JO
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
D. Capital assets
Capital assets balances and transactions for the year ended September 30, 2007 are summarized below and on
the following page.
Governmental activities: Balance at Balance at
October 1, 2006 Increases Decreases September 30, 2007
Capital assets not being depreciated:
Land $ 7,829,494 $ 10,160 $ - $ 7,839,654
Construction in progress 9,630,063 15,070,446 10 831922 13,868,587
Total capital assets not being depreciated 17,459,557 15,080,606 10 831922 21,708,241
Capital assets being depreciated:
Buildings 50,869,538 3,986,348 (46,499) 54,809,387
Infrastructure 166,183,829 8,715,548 - 174,899,377
Machinery and equipment and other
improvements 63,056,733 7,872,160 20107 084 50,821,809
Total capital assets being depreciated 280,110,100 20,574,056 20153 583 280,530,573
Less accumulated depreciation for:
Buildings 11,785,097 1,291,973 (34,023) 13,043,047
Infrastructure 70,928,830 8,402,644 - 79,331,474
Machinery and equipment and other
improvements 34,391,026 6,567,511 11017 582 29,940,955
Total accumulated depreciation 117,104,953 16,262,128 11 OS 1605 122,315,476
Total capital assets, being depreciated, net 163,005,147 4,311,928 9101978 158,215,097
Governmental activities capital assets, net 180 464 704 19 392 534 19 933 900 179 923 338
Capital assets for governmental activities include capital assets held in the internal service funds. Governmental
activities Accumulated Depreciation included an adjustment of $1,122,534 to reflect appropriate depreciation based
on asset lives. On October 1, 2006, the City eliminated the Motor Pool Fund, an internal service fund. The
elimination of the Motor Pool Fund resulted in $15,129,071 of original cost and $8,274,983 of accumulated
depreciation being transferred to governmental fixed assets and other internal service funds.
(Continued)
~n
,7
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
Balance at Balance at Business-type activities: October 1, 2006 Increases Decreases Se tember 30, 2007
P
Capital assets not being depreciated:
Land $ 9,779,660 $ 235,515 $ - $ 10,015,175
Construction in progress 37,250,781 23,049,614 26 006 233 34,294,162
Total capital assets not being depreciated 47,030,441 23,285,129 26 006 233 44,309,337
Capital assets being depreciated:
Buildings 6,619,392 840,654 (93,600) 7,366,446
Landfill improvements 9,885,664 15,002 - 9,900,666
Water rights 69,883,098 - - 69,883,098
Infrastructure 277,031,029 20,700,091 (8,003,853) 289,727,267
Plant, machinery, equipment and other improvements 178,651,701 36,218,210 3 271394 211,598,517
Total capital assets being depreciated 542,070,884 57,773,957 11368 847 588,475,994
Less accumulated depreciation for:
Buildings 2,448,276 189,915 (73,440) 2,564,751
Landfill improvements 9,336,374 311,093 - 9,647,467
Water rights 12,087,680 696,330 - 12,784,010
Infrastructure 63,394,239 7,781,697 (7,890,160) 63,285,776 Plant, machinery, equipment and other
improvements 79,772,628 17,711,345 2 510 021 94,973,952
Total accumulated depreciation 167,039,197 26,690,380 10 473 621 183,255,956
Total capital assets, being depreciated, net 375,031,687 31,083,577 895 226 405,220,038
Business-type activities capital assets, net 422 062128 54 368 706 26 901459 449 529 375
Business-type activities Accumulated Depreciation included an adjustment of $168,661 to reflect appropriate
depreciation based on asset lives. The prior period included $91,200 of Land that has been reclassified as
Infrastructure and $294,790 of Infrastructure that has been reclassified as Land. The elimination of the Motor Pool
fund resulted in $18,255,023 of original cost and $9,403,530 of accumulated depreciation being transferred to
business-type activities.
Depreciation expense was charged to governmental activities functions/programs as follows:
Governmental activities:
General government $ 2,020,606
Public Safety 3,226,582
Public Works 8,377,166
Parks & Recreation 1,287,171 Capital assets held by the internal service funds are
Charged to the various functions based upon usage 1,350,603
Total depreciation expense-governmental activities 16 262128
Business-type activities:
Electric $ 4,255,715
Water 5,033,989
Wastewater 5,087,019 Solid Waste 2,910,127
Total depreciation expense-business-type activities 17 286 850
~n
1-tv
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
Construction commitments
The City has several major construction projects planned or in progress as of September 30, 2007. These projects are evidenced by contractual commitments with contractors
and include:
Remaining
Project Spent-to-Date Commitment
Landfill Cell 3A $837,895 $2,536,428
R D Wells Interchange -Electric System Infrastructure 682,168 2,417,795 R D Wells Substation D -Electric System Infrastructure 953,688 1,864,962
Fort Worth Substation -Electric System Infrastructure 356,838 1,239,120
Solid Waste Scale House 719,607 1,016,485
Russell Newman Blvd 874,461 915,531
Bonnie Brae Distribution Substation 67,442 899,098
E. Interfund receivables, payables and transfers
A summary of Interfund receivables and payables (in thousands) at September 30, 2007, is as follows:
Interfund Receivables:
Governmental
Major Funds Business-Type Major Funds
Non-Major Internal
Governmental Solid Service
Interfund Payables: General Fund Funds Electric Water Wastewater Waste Funds Total
Agency Funds $ 75 $ - $ 6 $ 13 $ 7 $ 9 $ 5 $ 115
Non-Major Governmental Funds - 61 - - - - - 61
Internal Service Funds 396 - 4,802 288 288 5 - 5,779
Total $ 471 $ 61 $ 4,808 $ 301 $ 295 $ 14 $ 5 $ 5,955
Al
I-t 1
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
The more significant Interfund receivables and payables include the following:
Interfund receivables Interfund payables Amount
Electric fund Internal service funds-materials management $4,802,009
General fund Internal service funds-materials management 395,629
Water fund Internal service funds-materials management 287,702
Wastewater fund Internal service funds-materials management 287,702
The outstanding balances between the Electric, General, Water and Wastewater Funds and the Materials
Management Fund are a result of the cash position in the Materials Management Fund due to inventory
purchases.
Transfers between funds (in thousands) during the year were as follows:
Transfers Out:
Governmental Major
Funds Business-Type Major Funds
Capital Non-Major Internal
General Projects Governmental Solid Service
Transfers In: Fund Fund Funds Electric Water Wastewater Waste Funds Total
Governmental Major
Funds:
General Fund $ - $ - $ 82 $ - $ - $ - $ - $5,197 $ 5,279
Debt Service
Fund 887 255 - - - 628 - - 1,770
Capital Projects
Fund 1,095 - 374 - - 6 - 1,114 2,589
Non-Major
Governmental Funds 2,033 176 10 75 110 220 61 - 2,685
Electric - - - - - - - 5,154 5,154
Water 24 - 73 - - 69 - 2,937 3,103
Wastewater - - 146 - - - - 3,755 3,901
Solid Waste - - - - - - - 2,487 2,487
Internal Service Funds - - - - - - - 212 212
Government-wide/ Governmental
Activities - - - - - - - 3,377 3,377
Total $ 4,039 $ 431 $ 685 $ 75 $ 110 $ 923 $ 61 $24,233 $ 30,557
Al
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CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
The more significant transfers include the following:
Transfers from fund Transfers to fund Amount
Internal service funds-Motor Pool General Fund $5,196,998
Internal service funds-Motor Pool Electric 5,154,417
Internal service funds-Motor Pool Wastewater 3,755,083
Internal service funds-Motor Pool Government-wide activities 3,376,537
Internal service funds-Motor Pool Water 2,936,833
Internal service funds-Motor Pool Solid Waste 2,486,595
General Fund Aquatics 1,875,466
Internal service funds-Motor Pool Capital Projects l,l 14,241
Transfers from the General Fund to Aquatics were to cover the deficit in fund equity. Transfers from the Motor
Pool fund were due to the elimination of the fund and the transfers of the equity balances on October 1, 2006.
F. Leases
Leases payable represent the remaining principal amounts payable under lease purchase agreements for the
acquisition of equipment through the General, Solid Waste, Tech Services, and Wastewater funds. These leases
are recorded as capital leases. Remaining requirements, including interest, under these leases are as follows:
Year Pa menu
2008 $1,983,495
2009 1,877,654
2010 1,724,957
2011-2017 1,160,836
Total minimum lease payments 6,746,942
Less: amount representing interest 461,494
Present value of minimum future lease payments 6 285 448
The following schedule provides an analysis of the City's investments in equipment under capital lease
arrangements as of September 30, 2007:
Equipment $8,035,769
Less: Accumulated Depreciation 1 895 772 Total 6139 997
A2
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CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
G. Long-term debt
Long-term liabilities transactions for the year ended September 3 0, 2007, are summarized as follows below and
on the following page:
Balance at Balance at
October 1, September 30, Due Within
2006 Increases Decreases 2007 One Year
Governmental Activities:
General obligation bonds $ 58,742,900 $ 15,925,000 $ 4,017,583 $ 70,650,317 $ 4,340,723
Certificates of obligation 46,700,000 8,855,000 4,199,900 51,355,100 4,047,550
Obligations under capital leases 3,559,742 2,656,127 3,822,185 2,393,684 635,615
Arbitrage payable 25,968 - 22,633 3,335 -
Compensatedabsences payable 7,323,590 8,542,124 7,323,590 8,542,124 3,242,116
Claims payable 2,995,213 1,198,862 877,279 3,316,796 437,500
Unamortized premiuml(discounts) 418,591 528,630 97,646 849,575 94,267
Unamortized deferred gainl(loss) (393,205) (94) (105,102) (288,197) (101,150)
Total governmental
long-term liabilities $119,372,799 $37,705,649 $20,255,714 $136,822,734 $12,696,621
Business-type Activities:
Revenue bonds $277,305,000 $58,535,000 $54,090,000 $281,750,000 $14,840,000
General obligation bonds 3,582,100 - 482,417 3,099,683 449,277
Certificates of obligation 11,975,000 3,535,050 1,620,150 13,889,900 1,592,450
Obligations under capital leases - 4,873,533 981,769 3,891,764 1,179,570
Arbitrage payable 5,105 42,773 624 47,254 -
Compensatedabsences payable 1,560,082 1,635,962 1,560,082 1,635,962 1,444,462
Note payable 3,141,222 - - 3,141,222 -
Landfill closure/post-closure costs 3,689,408 285,054 - 3,974,462 -
Unamortized premiuml(discounts) 7,419,303 200,519 782,913 6,836,909 718,831
Unamortized deferred gainl(loss) (8,277,227) (2,281,076) (1,218,618) (9,339,685) -
Total business-type activities 300,399,993 66,826,815 58,299,337 308,927,471 20,224,590
Total long-term liabilities $419,772,792 $104,532,464 $78,555,051 $445,750,205 $32,921,211
[The elimination of the Motor Pool Fund resulted in the transfer of $945,050 in certificates of obligation and
$3,559,742 of Capital Lease obligations from Governmental Activities to Business-type Activities.]
AA
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CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
General bonded debt -General bonded debt at September 3 0, 2007, is comprised of the following:
Gross Amount
Original Outstanding at
Interest Rate Final Amount September 30,
Bonded Debt Issue Date Maturity of Issue 2007
General obligation 5.0 to 7.0 1997 2017 $ 4,700,000 $ 235,000
General obligation 5.25 to 5.25 1998 2018 9,660,000 5,295,000
General obligation 4.1 to 5.0 1999 2019 8,215,000 4,920,000
General obligation refunding 3.2 to 5.0 1999A 2016 5,538,780 3,708,300
General obligation 5.25 to 6.125 2000 2020 3,750,000 755,000
General obligation 4.5 to 5.5 2001 2021 14,245,000 9,985,000
General obligation 5.0 to 5.25 2002 2022 12,075,000 10,320,000
General obligation refunding 3.0 to 4.75 2003 2023 7,222,999 4,217,017
General obligation refunding 2.5 to 5.0 2004 2020 7,370,000 6,965,000
General obligation 3.0 to 5.0 2005 2025 5,000,000 4,730,000
General obligation 4.25 to 4.875 2006 2026 3,695,000 3,595,000
General obligation 4.0 to 4.5 2007 2026 15,925,000 15,925,000
Total general obligation bonds 97,396,779 70,650,317
Certificates of obligation 4.0 to 5.0 1998 2018 5,625,000 850,000
Certificates of obligation 4.1 to 5.0 1999 2019 5,926,273 3,540,000
Certificates of obligation 5.25 to 6.125 2000 2020 3,125,000 620,000
Certificates of obligation 4.25 to 5.25 2001 2021 8,275,000 4,030,000
Certificates of obligation 4.7 to 5.25 2002 2022 8,045,000 5,995,000
Certificates of obligation 3.0 to 4.75 2003 2023 5,650,000 4,325,000
Certificates of obligation 2.0 to 5.0 2004 2024 12,805,000 11,625,000
Certificates of obligation 3.0 to 4.375 2005 2025 5,575,000 4,765,000
Certificates of obligation 4.0 to 4.75 2006 2026 7,214,950 6,750,100
Certificates of obligation 4.7 to 5.0 2007 2027 8,855,000 8,855,000
Total certificates of obligation 71,096,223 51,355,100
Total general bonded debt $168,493,002 $122,005,417
[These amounts do not include net unamortizedpremiums/(discounts) of $849,575 nor net deferred gainl(loss)
on refunding of ($288,197).]
Proceeds of general bonded debt are restricted to the uses for which they were approved in the bond elections.
The City Charter expressly prohibits the use of bond proceeds to fund operating expenses. The general
obligations are collateralized by the full faith and credit of the City and, primarily, payable from property taxes.
In prior years, the City defeased general obligation bonds by placing the proceeds of new bonds in an
irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust
account assets and liabilities for the defeased bonds are not included in the City's financial statements. On
September 30, 2007, $3,060,000 of general obligation bonds considered defeased are still outstanding.
AG
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CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
In July 2007, the City issued $11,445,000 ($2,590,000 of which is included as part of business-type activities)
in certificates of obligation and $15,925,000 of general obligation bonds. The debt was issued to pay the cost of
various Capital Project improvements ($24,700,000) and proprietary fund capital improvements ($2,590,000).
The bonds and obligations are payable over the next 20 years.
Revenue bonds -Revenue bond debt at September 30, 2007, is comprised of the following issues:
Principal Net Net
Original Outstanding at Unamortized Outstanding at
Interest Rate Issue Final Amount September 30, Premiuml September 30,
Revenue Bonds Date Maturity of Issue 2007 (Discount) 2007
Utility system
refunding 3.55 to 6.75 1993 2008 $ 6,045,000 $ 385,000 $ (281) $ 384,719
Utility system 4.3 to 6.3 1998 2018 7,175,000 1,440,000 - 1,440,000 Utility system
refunding 4.65 to 6.65 1998 2030 36,795,000 3,210,000 (26,216) 3,183,784
Utility system
refunding 4.0 to 5.0 1998 2015 7,640,000 5,760,000 - 5,760,000
Utility system 4.974 to 6.0 2000 2020 54,880,000 15,690,000 15,111 15,705,111
Utility system 4.0 to 5.4 2001 2021 59,545,000 23,825,000 186,089 24,011,089
Utility system 4.25 to 5.0 2002 2022 56,710,000 47,180,000 254,546 47,434,546
Utility system 5.0 to 6.5 2002 2022 13,985,000 3,405,000 (8,286) 3,396,714
Utility system 3.625 to
refunding 5.625 2003 2022 50,180,000 36,555,000 1,118,461 37,673,461 Utility system
refunding 2.0 to 5.25 2004 2024 24,850,000 23,865,000 1,048,084 24,913,084
Utility system
refunding 3.0 to 5.0 2005 2023 53,845,000 53,690,000 4,053,840 57,743,840
Utility system
refunding 4.5 to 5.0 2006 2026 8,515,000 8,210,000 - 8,210,000
Utility system 4.0 to 4.25 2007 2026 16,740,000 16,740,000 4,196 16,744,196 Utility system
refunding 4.0 to 4.25 2007 2029 41,795,000 41,795,000 135,333 41,930,333
Total revenue
Bonds $438,700,000 $281,750,000 $6,780,877 $288,530,877
[These amounts do not include net unamortizedgain/(loss) on refunding of ($9,243,555).]
AL
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CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
Other enterprise obligations -General obligation bonds and certificates of obligation issued for solid waste
fund at September 30, 2007, is comprised of the following:
Gross Amount
Interest Original Outstanding at
Rate Issue Final Amount September 30,
Other Obligations Date Maturity of Issue 2007
General obligation refunding 3.2 to 5.0 1999 2016 $ 1,481,220 $ 991,700
General obligation refunding 3.0 to 4.75 2003 2023 857,001 472,983
General obligation refunding 2.5 to 5.0 2004 2015 2,040,000 1,635,000
Total general obligation bonds 4,378,221 3,099,683
Certificates of obligation 4.25 to 5.25 2001 2021 3,845,000 945,000
Certificates of obligation 4.7 to 5.25 2002 2022 4,545,000 2,600,000
Certificates of obligation 3.0 to 4.75 2003 2023 1,755,000 695,000
Certificates of obligation 2.0 to 5.0 2004 2024 1,195,000 905,000
Certificates of obligation 3.0 to 4.375 2005 2025 1,570,000 1,240,000
Certificates of obligation 4.0 to 4.75 2006 2026 5,450,050 4,914,900
Certificates of obligation 4.7 to 5.0 2007 2027 2,590,000 2,590,000
Total certificates of obligation 20,950,050 13,889,900
Total other enterprise obligations $25,328,271 $16,989,583
[These amounts do not include net unamortized premiumsl(discounts) of $56,032 nor net deferred gainl(loss) on refunding of ($96,130).]
The revenue bonds are collateralized by the revenue of the Denton utility system funds (System) and the various
special funds established by the bond ordinance. The ordinance provides that the revenue of the System is to be
used first to pay operating and maintenance expenses of the System and second to establish and maintain the revenue bond funds. Any remaining revenues may then be used for any lawful
purpose. The ordinance also
contains provisions, which among other items restrict the issuance of additional revenue bonds unless the
special funds noted above contain the required amounts and certain financial ratios are met. Management
believes the City is in compliance with all significant requirements. Assets in these accounts consist of cash
and U.S. government securities. Below is a summary of the various net asset balances in the funds required by
the bond ordinance to be restricted for debt service.
Interest and sinking fund $11,3 77,144 Reserve fund 17,720,015
Total restricted net assets restricted for debt service $29,097,159
In prior years, the City defeased revenue bonds by placing the proceeds of new bonds in an irrevocable trust to
provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and
liabilities for the defeased bonds are not included in the City's financial statements. On September 30, 2007,
$72,861,000 of revenue bonds considered defeased are still outstanding.
A r1
I-t /
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
In February 2007, the City issued $41,795,000 of revenue refunding bonds. The reacquisition price exceeded
the net carrying amount of the old debt by $2,281,076. This amount is being amortized over the remaining life
of the refunded debt, which is shorter than the life of the new debt issued. This advanced refunding was
undertaken to reduce total debt service payments over the next 20 years by $3,996,164 and resulted in a net
present value savings of $2,238,899.
In July 2007, the City issued $16,740,000 in revenue bond debt. The debt was issued to pay for the cost of
various utility system improvements and upgrades. The bonds are payable over the next 20 years.
Note payable
In 1980, the City and the City of Dallas contracted with the Corps of Engineers for the construction and development of Ray Roberts Reservoir in Denton County. In contracts
with the Corp of Engineers, the City
will pay for twenty-six (26%) percent of the estimated water storage rights of the reservoir. Water obtained
from the reservoir will be pro rata on the basis of each city's proportional share of total construction cost. The
closing of the dam was completed in 1987 with water being available from the reservoir in 1989.
Schedule of long-term debt maturities
Aggregate maturities of the long-term debt (principal and interest) for the years subsequent to September 30, 2007, are shown below and on the following page:
Governmental Activities:
Certificates of
General Obli a.~ tion Obli anon Capital Leases Total
Fiscal Year Principal Interest Principal Interest Principal Interest Principal Interest 2008 $ 4,340,723 $ 3,307,718 $ 4,047,550 $ 2,294,136 $
635,615 $ 40,512 $ 9,023,888 $ 5,642,366
2009 4,263,569 3,056,747 4,216,400 2,084,539 643,329 32,798 9,123,298 5,174,084
2010 4,215,885 2,871,391 4,258,200 1,901,932 604,497 24,775 9,078,582 4,798,098
2011 4,457,630 2,676,730 4,027,950 1,717,795 120,684 19,440 8,606,264 4,413,965
2012 4,719,305 2,468,204 3,275,000 1,552,545 125,203 14,920 8,119,508 4,035,669
2013-2017 23,118,205 9,087,695 13,625,000 5,856,758 264,356 31,468 37,007,561 14,975,921 2018-2022 17,620,000 3,968,935 12,195,000
2,778,999 - - 29,815,000 6,747,934
2023-2027 7,915,000 901,622 5,710,000 454,199 - - 13,625,000 1,355,821
Total $70,650,317 $28,339,042 $51,355,100 $18,640,903 $2,393,684 $163,913 $124,399,101 $47,143,858
AQ
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CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
Business-Type Activities:
Certificates of
General Obli a.~ tion Obli anon Revenue
Fiscal Year Prl~ncipal Interest Principal Interest Principal Interest
2008 $ 449,277 $115,145 $ 1,592,450 $ 611,451 $14,840,000 $ 13,088,928 2009 471,431 100,124 1,453,600 537,231 14,865,000 12,431,555
2010 474,115 83,630 1,431,800 474,224 15,430,000 11,650,536
2011 332,370 68,146 1,322,050 411,641 14,320,000 10,887,021
2012 345,695 54,068 1,160,000 354,148 14,955,000 10,168,263
2013-2017 1,026,795 77,468 2,825,000 1,276,376 83,590,000 39,295,695 2018-2022 - - 2,790,000 649,036 88,130,000 17,956,806
2023-2027 - - 1,315,000 126,829 28,190,000 4,213,528
2028-2032 - - - - 7,430,000 482,800
Total $3,099,683 $498,581 $13,889,900 $4,440,936 $281,750,000 $120,175,132
Notes Payable Capital Leases Total
Fiscal Year Principal Interest Principal Interest Principal Interest 2008 $3,141,222 $ - $1,179,570 $127,797 $21,202,519 $13,943,321
2009 - - 1,113,259 88,268 17,903,290 13,157,178
2010 - - 1,044,855 50,831 18,380,770 12,259,221
2011 - - 272,048 20,335 16,246,468 11,387,143
2012 - - 282,032 10,350 16,742,727 10,586,829 2013-2017 - - - - 87,441,795 40,649,539
2018-2022 - - - - 90,920,000 18,605,842
2023-2027 - - - - 29,505,000 4,340,357
2028-2032 - - - - 7,430,000 482,800
Total $3,141,222 $ - $3,891,764 $297,581 $305,772,569 $125,412,230
[These amounts do not include net unamortized premiuml(discount) of $7,686,484 nor net unamortized
gainl(loss) on refunding of ($9,627,882).]
Bonds authorized and unissued
General obligation bonds authorized but unissued as of September 30, 2007, amounted to $22,102,000. When
issued, the proceeds will be allocated to the applicable capital projects.
H. Landfill closure and post-closure cost
State and federal laws and regulations require the City to place a final cover on its Mayhill Road landfill site upon closure and to perform certain maintenance and monitoring
functions at the site for thirty years after
closure. Although closure and post-closure care costs will be paid only upon anticipated closure, the City
reports a portion of these costs as an operating expense in each period based on landfill capacity used as of each
balance sheet date. Based on a model created by a 2005 engineering study, total landfill closure and post-
closure cost increased from $14,582,641 to $14,947,207 and increased this year's reported landfill closure and
post-closure expense by $285,054. The $3,974,462 reported as landfill closure and post-closure care liability
represents the cumulative amount incurred to date based on the use of 26.6% of the estimated capacity of the
entire landfill at September 30, 2007.
Based on this estimate, the remaining potential estimated liability for closure and post-closure care of the entire
landfill is $10,972,745. The City will recognize the remaining estimated cost of closure and post-closure care
as the remaining capacity is filled. These amounts are based on what it would cost to perform closure and post-
closure care in 2007. Actual cost may fluctuate due to inflation, changes in technology, or changes in
~n
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CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
regulations. The landfill has a remaining life of 27 years, and the City expects to close the landfill in fiscal year
2034.
The solid waste fund has provided for a designation of cash and investments of $3,974,462 at September 30,
2007, and anticipates increasing the reserve in future periods as the closure and post-closure activities are
carried out.
V. OTHER INFORMATION
A. Pension plans
Texas Municipal Retirement Plan
Plan description
The City provides pension benefits for all of its full-time employees (except fire fighters) through anon-
traditional,joint contributory, hybrid-defined benefit plan in the state-wide Texas Municipal Retirement System
(TMRS), one of 821 administered by TMRS, an agent multiple-employer public employee retirement system.
Benefits
Benefits depend upon the sum of the employee's contributions to the plan, with interest, and the City-financed monetary credits, with interest. At the date the plan began,
the City granted monetary credits for service
rendered before the plan began of a theoretical amount equal to two times what would have been contributed by
the employee, with interest, prior to establishment of the plan. Monetary credits for service since the plan
began are a percent (200%) of the employee's accumulated contributions. In addition, the City can grant, as
often as annually, another type of monetary credit referred to as an updated service credit which is a theoretical
amount which, when added to the employee's accumulated contributions and the monetary credits for service
since the plan began, would be the total monetary credits and employee contributions accumulated with interest
if the current employee contribution rate and City matching percent had always been in existence and if the
employee's salary had always been the average of their salary in the last three years that are one year before the
effective date. At retirement, the benefit is calculated as if the sum of the employee's accumulated contributions
with interest and the employer-financed monetary credits with interest were used to purchase an annuity.
Members can retire at ages 60 and above with five or more years of service or with 20 years of service
regardless of age. A member is vested after five years. The plan provisions are adopted by the governing body
of the City, within the options available in the state statutes governing TMRS and within the actuarial constraints also in the statutes.
Contributions
The contribution rate for the employees is 7%, and the City matching ratio is currently 2 to 1, both as adopted
by the governing body of the City. Under the state law governing TMRS, the actuary annually determines the
city contribution rate. This rate consists of the normal cost contribution rate and the prior service contribution rate, both of which are calculated to be a level percent
of payroll from year to year. The normal cost
contribution rate finances the currently accruing monetary credits due to the City matching percent, which are
the obligation of the City as of an employee's retirement date, not at the time the employee's contributions are
made. The normal cost contribution rate is the actuarially determined percent of payroll necessary to satisfy the
obligation of the City to each employee at the time a retirement becomes effective. The prior service
contribution rate amortizes the unfunded actuarial liability over the remainder of the plan's 25-year amortization
period. The unit credit actuarial cost method is used for determining the City contribution rate. Both the
employees and the City make contributions monthly.
Three-Year Trend Information for TMRS Funding
Year ending 12/31/06 12/31/05 12/31/04
Annual required contribution (ARC) $9,311,315 $9,347,195 $8,707,103
Actual contributions $9,311,315 $9,347,195 $8,707,103
Percent contributed 100% 100% 100%
cn
JV
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
Actuarial Assumptions
12/31/06
Actuarial cost method Unit credit
Amortization method Level percent of payroll
Remaining amortization period 25 years -open period
Asset valuation method Amortized cost
Investment rate of return 7%
Projected salary increases None
Includes inflation at 3.5%
Cost-of living adjustments None
At its December 8, 2007 meeting, the TMRS Board of Trustees adopted actuarial assumptions to be used in the
actuarial valuation for the year ended December 3 1, 2007. A summary of actuarial assumptions and definitions
can be found in the December 3 1, 2007 TMRS Comprehensive Annual Financial Report.
Since its inception, TMRS has used the traditional Unit Credit actuarial funding method. This method accounts
for liability accrued as of the valuation date but does not project the potential future liability of provisions
adopted by a city. Two-thirds of the cities participating in TMRS have adopted the Updated Service Credit and
Annuity Increases provisions on an annually repeating basis. These provisions are considered to be
"committed" benefits (or likely to be guaranteed); as such, the TMRS Board has adopted the Projected Unit
Credit (PUC) actuarial funding method, which facilitates advance funding for future updated service credits and
annuity increases that are adopted on an annually repeating basis. For the December 31, 2007 valuation, the
TMRS Board determined the PUC method will be used.
In addition, the Board also adopted a change in the amortization period from a 25-year "open" to a 25-year
"closed" period. TMRS Board of Trustee rules provide, whenever a change in actuarial assumptions or
methods results in a contribution rate increase in an amount greater than 0.5%, the amortization period may be
increased up to 30 years, unless a city requests the period remain at 25 years. For cities with repeating features,
these changes will likely result initially in higher required contributions and lower funded ratios. To assist in
this transition to higher rates, the Board also approved an eight-year phase-in period, which will allow cities the
opportunity to increase their contributions gradually (approximately 12.5% each year) to their full rate (or their required contribution rate).
Using demographic date from the December 3 1, 2006 valuation, TMRS' actuary has made calculations with the
new actuarial assumptions. For cities with annually repeating benefits, those calculations resulted in estimated
higher contribution rates, increased unfunded actuarial liabilities, and lower funded ratios.
The City adopted the Updated Service Credit provision in 1992, on a repeating basis. Additionally, the City
adopted annuity increases for its retirees, on a repeating basis in 1992 equal to 70% of the change in consumer
price index.
The City of Denton is one of 821 municipalities having the benefit plan administered by TMRS. Each of the
821 municipalities has an annual, individual actuarial valuation performed. All assumptions for the
December 31, 2006, valuations are contained in the 2006 TMRS Comprehensive Annual Financial Report, a
copy of which maybe obtained by writing to P.O. Box 149153, Austin, Texas 78714-9153.
In December 2007 the TMRS Board of Trustees adopted a change in actuarial cost methods. The effect of the
change will result in an increase in city contribution rates for most Texas cities. Currently this impact is
unknown but will be distributed by TMRS based on an actuarial valuation as of December 3 1, 2007.
01
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
Denton Firemen's Relief and Retirement Plan
Plan description
The Board of Trustees of the Denton Firemen's Relief and Retirement Fund is the administrator of a single-
employerdefined benefit pension plan.
The Denton Firemen's Relief and Retirement Fund cover firefighters in the Denton Fire Department. The table
below summarizes the membership of the fund as of December 31, 2005, the most recent biennial actuarial
valuation.
12/31/OS
1. Retirees and beneficiaries currently receiving
benefits and terminated employees entitled to 53
benefits but not yet receiving them
2. Current employees
a. Vested 73
b. Nonvested 92
3 . Total 218
The Denton Firemen's Relief and Retirement Fund provides service retirement, death, disability and withdrawal
benefits. These benefits vest after 10 years of credited service. Firefighters may retire at age 50 with 20 years
of service. As of the December 31, 2005 actuarial valuation date, the Plan effective May 1, 2005 and amended
June 14, 2007 provided a monthly normal service retirement benefit, payable in a Joint and Two-Thirds to
Spouse form of annuity, equal to 2.44% of Highest 36-Month Average Salary for each year of service.
There is no provision for automatic postretirement benefit increases. The fund has the authority to provide, and
has periodically in the past provided for, ad hoc postretirement benefit increases. The benefit provisions of this
plan are authorized by the Texas Local Fire Fighter's Retirement Act (TLFFRA). TLFFRA provides the
authority and procedure to amend benefit provisions.
Contributions Required and Contributions Made
The contribution provisions of this plan are authorized by TLFFRA. The TLFFRA provides the authority and
procedure to change the amount of contributions determined as a percentage of pay by each firefighter and a
percentage of payroll by the city.
While the contribution requirements are not actuarially determined, state law requires that an eligible actuary
must approve each plan of benefits adopted by the fund. The actuary certifies that the contribution commitment
by the firefighters and the city provides an adequate financing arrangement. Using the entry age actuarial cost
method, the plans' normal cost contribution rate is determined as a percentage of payroll. The excess of the
total contribution rate over the normal cost contribution rate is used to amortize the plan's unfunded actuarial
accrued liability, and the number of years needed to amortize the plan's unfunded actuarial accrued liability is
determined using an open, level percentage of payroll method.
The costs of administering the plan are financed from the fund.
The funding policy of the Denton Firemen's Relief and Retirement Fund requires contributions equal to 12% of
pay by the firefighters. The City of Denton contributed 10% of payroll during January through September
2006, will contribute 11 % of payroll October 2006 through September 2007, and is planning to contribute 12%
of payroll October 2007 through September 2008 and then to begin contributing the same percentage of payroll
that the city contributes to the Texas Municipal Retirement System for other employees. The December 31,
2005 actuarial valuation assumes that the city contribution rate will average 12.75% beginning October 2008.
JG
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
Three-Year Trend Information for Denton Firemen's Relief and Retirement Funding
Year ending 12/31/06 12/31/OS 12/31/04
Annual required contribution (ARC) $2,071,542 $1,970,632 $1,868,444
Actual contributions $2,071,542 $1,970,632 $1,868,444
Percent contributed 100% 100% 100%
Actuarial Assumptions
12/31/05
Actuarial cost method Entry age
Amortization method Level percent of payroll, open
Amortization period for ARC 23 years
Asset valuation method 5-year adjusted market
value
Investment rate of return 7.75%
Projected salary increases 4.50% plus promotion
and longevity
Includes inflation at 4.0%
Cost-of living adjustments None
Payroll increases 4.50%
ARC as percent of payroll Budgeted rates
Financial statements are available and can be obtained by contacting the Denton Fire Department at the City of
Denton at 332 E. Hickory, Denton, Texas 76201.
B. Deferred compensation plan
The City offers its employees a deferred compensation plan created in accordance with Internal Revenue Code
Section 457. The plan, available to all permanent City employees, permits them to defer, until future years, up
to 25% of annual gross earnings not to exceed $15,500. Employees who are age 50 or older may contribute an
amount not to exceed $20,500. Employees who are within three years of retirement eligibility may elect to participate in a catch-up provision allowed by Section 457, which has an
annual maximum contribution amount
of $31,000. The withdrawal of deferred compensation funds is not available to employees until termination,
retirement, death, or unforeseeable emergency.
All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property or rights
are, until paid or made available to the
employee or other beneficiary, solely the property and rights of the employees. Accordingly, the assets and
associated liability of the plan are not included in the City's financial statements.
It is the opinion of the City's legal counsel that the City has no liability for losses under the plan.
C. Self insurance plan
The City has established a self insurance plan for workers' compensation benefits and general liability. Employee health insurance is afully-insured plan, however,
the City will move to self insurance starting
January 2008. Accrued claims payable include provisions for claims reported and claims incurred but not
reported. The provision for reported claims is determined by estimating the amount which will ultimately be
JJ
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
paid each claimant. The provision for claims incurred but not yet reported is estimated based on actuarial
studies.
The City's costs associated with the self insurance plan are reported as interfund transactions. Accordingly,
they are treated as operating revenues of the Internal Service Risk Retention Fund and operating expenditures (expenses) of the other funds.
Workers' compensation and general liability insurance
It is the policy of the City of Denton not to purchase commercial insurance for workers' compensation claims or general liability. Commercial liability insurance coverage is purchased
for public officials, airport operations,
emergency medical services, take-home vehicles, and employee theft and dishonesty. Additionally, excess
insurance is purchased for general liability and workers' compensation exposure. The City reports liabilities
when it is probable that a loss has occurred and the amount of that loss can be reasonably estimated. Liabilities
include an amount for claims that have been incurred but not reported. Because actual claims liabilities depend
on such complex factors as inflation, changes in legal doctrines, and damage awards, the process used in
computing claims liability does not necessarily result in an exact amount.
Claims liabilities are re-evaluated periodically to take into consideration settlement of claims, new claims and
other factors. As of September 30, 2007, the estimated value of these liabilities was $3,316,796. Changes in
balances of claims liabilities during fiscal years 2007 and 2006 were as follows:
Claims Liability Claims and Claims Liability Beginning of Change in Claims End of
Fiscal Year Estimates Payments Fiscal Year
Workers'
Compensation
2007 $2,418,698 $ 958,944 $738,947 $2,638,696
2006 1,450,000 1,437,485 468,787 2,418,698
General Liability
2007 $ 576,515 $ 239,918 $138,332 $ 678,100
2006 353,000 302,868 79,353 576,515
On September 30, 2007, the City of Denton held net assets of $1,733,246 in the Risk Retention Fund for payment of claims. There were no significant reductions in insurance
coverage from coverage in the prior year,
and the amount of settlements did not exceed insurance coverage in the current year or in any of the past three
fiscal years.
D. Commitments and contingencies
Agreement with TMPA
In 1976, the City, along with the cities of Bryan, Greenville, and Garland, Texas (the Cities) entered into a
Power Sales Contract with the Texas Municipal Power Agency (TMPA). TMPA was created through
concurrent ordinances of the Cities and is governed by a Board of Directors consisting of eight members, two
appointed by the governing body of each city. Under the terms of the agreement, TMPA agreed to construct or
acquire electric generating plants to supply energy and power to the Cities for a period of not less than 35 years.
The Cities in turn agreed to purchase all future power and energy requirements in excess of the amounts
generated by their systems from TMPA at prices intended to cover operating costs and retirement of debt. In the
event that revenues are insufficient to cover all costs and retire the outstanding debt, each of the Cities has guaranteed a portion of the unpaid debt based, generally, upon
its pro rata share of the energy delivered to
consumers in the prior operating year.
J1-t
CITY OF DENTON, TEXAS
NOTES TO BASIC FINANCIAL STATEMENTS (continued)
SEPTEMBER 30, 2007
As of September 30, 2007, total TMPA long-term debt outstanding was approximately $1,026,502,000, and the
City's percentage was approximately 21.3%. In the opinion of management, the possibility of a material
payment in the near future under this guarantee is remote in that TMPA is generating operating profits and
assets exceed liabilities.
TMPA operates a 462-megawatt, coal-fired generating plant. In 1996, TMPA switched to an external source of
coal to reduce costs. Should TMPA be dissolved, each city would be entitled to an undivided interest in the
property.
Selected financial statement information of TMPA is as follows:
September 30
(Unaudited)
2007 2006
(OOOs) (OOOs)
Operating revenues $ 248,977 $ 244,480
Operating expenses 112,916 103,876
Operating income 136,061 140,604
Other non-operating sources 9,361 8,413
Current assets 48,166 55,778
Total assets 1,203,288 1,245,503
Long-term debt 1,026,502 1,072,169
Total liabilities 1,165,858 1,209,944
Total equity 37,430 35,559
Agreement with the City of Dallas
During 1985, the City entered into an agreement with the City of Dallas that provides for the purchase of a
minimum of 500,000 gallons/day of untreated water from the City of Dallas from Lake Lewisville. This
contract will be effective for 30 years. The cost of water purchased under this agreement during fiscal year
2007 was $52,974.
E. Litigation
Various claims and lawsuits are pending against the City. In accordance with GAAP, those judgments
considered "probable" are accrued, while those claims and judgments considered "reasonably possible" are
disclosed but not accrued. In the opinion of City management and legal counsel, the maximum amount of all
significant claims considered reasonably possible, excluding condemnation proceedings, is approximately
$500,000 as of September 30, 2007. Potential losses after insurance coverage on all probable claims and
lawsuits will not have a material effect on the City's financial position as of September 30, 2007.
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JU
CITY OF DENTON, TEXAS
REQUIRED SUPPLEMENTARY INFORMATION Exhibit XII SCHEDULE OF TMRS FUNDING PROGRESS AND CONTRIBUTIONS
LAST THREE FISCAL YEARS (Unaudited)
Actuarial Unfunded
Accrued Actuarial
Actuarial Actuarial Liability (AAL) Accrued
Fiscal Valuation Value of Unit Credit Liability Funded
Year Date Assets Method (UAAL) Percent 2005 12/31/2004 $ 95,204,213 ~ 127,827,803 ~ (32,623,590) 74.5
2006 12/31/2005 98,051,747 133,853,457 (35,801,710) 73.3
2007 12/31/2006 105,951,245 145,309,633 (39,358,388) 72.9
UAAL as
Percent of Annual
Fiscal Covered Covered Required Actual Percent
Year Payroll Payroll Contributions Contributions Contributed
2005 $ 46,415,828 70.3 $ 8,707,103 $ 8,707,103 100.0 2006 46,394,303 77.2 9,347,195 9,347,195 100.0
2007 47,271,473 83.3 9,311,315 9,311,315 100.0
S7
V 1
CITY OF DENTON, TEXAS
REQUIRED SUPPLEMENTARY INFORMATION Exhibit XIII SCHEDULE OF DENTON FIREMEN'S RELIEF AND RETIREMENT PLAN
FUNDING PROGRESS AND CONTRIBUTIONS
LAST THREE VALUATION YEARS (Unaudited)
Actuarial Unfunded
Accrued Actuarial
Actuarial Actuarial Liability (AAL) Accrued
Fiscal Valuation Value of Unit Credit Liability Funded
Year Date Assets Method (UAAL) Percent 2002 12/31/2001 $ 26,061,756 $ 29,786,004 $ (3,724,248) 87.5%
2004 12/31/2003 30,538,352 37,557,733 (7,019,381) 81.3
2006 12/31/2005 34,677,009 45,341,724 (10,664,715) 76.5
UAAL as
Percent of Annual
Fiscal Covered Covered Required Actual Percent
Year Payroll Payroll Contributions Contributions Contributed
2002 $ 7,947,098 46.9% $ 1,504,822 $ 1,504,822 100.0% 2004 8,459,472 83.0 1,846,396 1,846,396 100.0
2006 10,445,026 102.1 1,970,632 1,970,632 100.0
SA
V V
NONMAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS
Special revenue funds are used to account for specific revenues that are legally restricted to expenditures for particular
purposes.
Community Development Block Grant (CDBG) - to account for the operations of projects utilizing Community
Development Block Grant Funds. Such revenues are restricted to expenditures for specified projects by the
Department of Housing and Urban Development.
Recreation - to account for the revenues and expenditures for the recreation programs that are self supporting. All
expenditures will be reimbursed 100%. Various business operations, such as concessions, fall into this account.
Criminal Justice - to account for revenue received from the State of Texas Criminal Justice Division and other
grants administered by the police department.
Police Confiscation - to account for revenues received from confiscated goods. Expenditures are restricted to
enhancing law enforcement.
Tourist and Convention - to account for taxes received from hotel and motel occupancy for the purpose of promoting tourism.
Citizens' Park Trusts - to account for several small trust funds that are for park development, previously reported as
expendable trust funds.
All Other - to account for miscellaneous special revenue sources that are required to finance specific activities.
~n
Jy
CITY OF DENTON, TEXAS
COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS
AS OF SEPTEMBER 30, 2007
Special Revenue Funds
Community
Development Criminal Police
Block Grant Recreation Justice Confiscation
ASSETS Cash, cash equivalents and investments,
at fair value ~ 16,656 $ 704,422 ~ - $ 218,541
Receivables (net of allowances):
Accrued interest - - - -
Other - - - -
Interfund receivables - - - - Duefrom other governments 275,847 374,764 77,270 -
Totalassets ~ 292,503 $ 1,079,186 ~ 77,270 $ 218,541
LIABILITIES AND FUND BALANCES
LIABILITIES:
Accounts payable ~ 185,222 $ 157,371 ~ 16,659 $ 11,765 Interfund payables - - 60,611 -
Retainagepayable 6,742 - - -
Deferred revenues 86,693 374,764 77,270 -
Totalliabilities 278,657 532,135 154,540 11,765
FUND BALANCES: Unreserved balance 13,846 547,051 (77,270) 206,776
Total fund balance (deficit) 13,846 547,051 (77,270) 206,776
Total liabilities and fund balances ~ 292,503 $ 1,079,186 ~ 77,270 $ 218,541
~n
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Exhibit XIV
Special Revenue Funds (continued) Total
Tourist Citizens' Nonmajor
and Park All Governmental
Convention Trusts Other Funds
$ 186,786 $ 4,467,956 $ 3,131,631 $ 8,725,992
- 23,881 29,000 52,881
106,447 - 46,087 152,534
- - 60,611 60,611 - - 347,517 1,075,398
$ 293,233 $ 4,491,837 $ 3,614,846 $ 10,067,416
~ - ~ 857 ~ 103,295 ~ 475,169 - - - 60,611
- - - 6,742
- - 90,056 628,783
- 857 193,351 1,171,305
293,233 4,490,980 3,421,495 8,896,111
293,233 4,490,980 3,421,495 8,896,111
$ 293,233 $ 4,491,837 $ 3,614,846 $ 10,067,416
~1
V 1
CITY OF DENTON, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Special Revenue Funds Community
Development Criminal Police
Block Grant Recreation Justice Confiscation
REVENUES:
Fees for services ~ - $ 2,114,001 ~ - ~ - Fines and forfeitures - - - 102,148
Investment revenue - 23,013 - -
Tax revenue - - - -
Intergovernmental 1,786,165 434,164 50,252 -
Miscellaneous 100,941 8,775 2,530 16,259
Total revenues 1,887,106 2,579,953 52,782 118,407
EXPENDITURES:
General government 1,448,204 - - -
Publicsafety - - 126,112 109,248
Public works - - - -
Parks and recreation - 2,811,439 - - Capitaloutlay - 69,895 35,000 9,450
Total expenditures 1,448,204 2,881,334 161,112 118,698
Excess (deficiency) of revenues over (under)
expenditures 438,902 (301,381) (108,330) (291)
OTHER FINANCING SOURCES (USES):
Transfers in - 1,875,466 31,060 -
Transfers out (456,865) - - -
Total other financing sources (uses) (456,865) 1,875,466 31,060 -
Net change in fund balances (17,963) 1,574,085 (77,270) (291)
Fund balance (deficit) at beginning of year 31,809 (1,027,034) - 207,067
Fund balance (deficit) at end of year ~ 13,846 $ 547,051 ~ (77,270) ~ 206,776
yr
Exhibit XV
Special Revenue Funds (continued) Total Tourist Citizens' Nonmajor
and Park All Governmental
Convention Trusts Other Funds
$ - $ 397,822 $ 672,872 $ 3,184,695 - - 494,209 596,357
- 201,540 73,583 298,136
1,268,627 - - 1,268,627
- - 1,199,406 3,469,987
- - 349,119 477,624
1,268,627 599,362 2,789,189 9,295,426
1,242,503 - 1,051,171 3,741,878
- - 627,153 862,513
- - 62,143 62,143
- - 108,154 2,919,593 - 4,599 229,606 348,550
1,242,503 4,599 2,078,227 7,934,677
26,124 594,763 710,962 1,360,749
- - 778,851 2,685,377
- - (227,851) (684,716)
- - 551,000 2,000,661
26,124 594,763 1,261,962 3,361,410
267,109 3,896,217 2,159,533 5,534,701
$ 293,233 $ 4,490,980 $ 3,421,495 $ 8,896,111
~z
vv
CITY OF DENTON, TEXAS Exhibit XVI
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET TO ACTUAL
DEBT SERVICE FUND
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Variance with Adjustments - Actual on a Final Budget -
Budgeted Amounts Actual Budgetary Budgetary Positive
Original Final Amounts Basis Basis (Negative)
REVENUES:
Taxes $ 9,732,726 $ 9,732,726 S 9,791,684 ~ - $ 9,791,684 ~ 58,958
Investment (loss) - - 82,748 - 82,748 82,748 Total revenues 9,732,726 9,732,726 9,874,432 - 9,874,432 141,706
EXPENDITURES:
Debt service:
Principal, interest and fiscal charges 14,775,824 14,775,824 11,197,746 3,273,301 14,471,047 304,777
Total expenditures 14,775,824 14,775,824 11,197,746 3,273,301 14,471,047 304,777
Deficiency of revenues
under expenditures (5,043,098) (5,043,098) (1,323,314) (3,273,301) (4,596,615) 446,483
OTHER FINANCING SOURCES:
Transfers in 5,043,098 5,043,098 1,769,797 3,273,301 5,043,098 -
Totalother financing sources 5,043,098 5,043,098 1,769,797 3,273,301 5,043,098 -
Net change in fund balance - - 446,483 - 446,483 446,483
Fund balance at beginning of year 439,658 439,658 439,658 - 439,658 -
Fund balance at end of year $ 439,658 $ 439,658 S 886,141 ~ - $ 886,141 ~ 446,483
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V Z
CITY OF DENTON, TEXAS Exhibit XVII
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES -BUDGET TO ACTUAL SPECIAL REVENUE FUNDS: RECREATION FUND
FOR YEAR ENDED SEPTEMBER 30, 2007
Variance with
Adjustments - Actual on a Final Budget -
Budgeted Amounts Actual Budgetary Budgetary Positive
Original Final Amounts Basis Basis (Negative)
REVENUES: Fees for services $ 2,195,013 $ 2,195,013 $ 2,114,001 ~ - ~ 2,114,001 ~ (81,012)
Investment revenue 10,000 10,000 23,013 - 23,013 13,013
Intergovernmental 445,412 445,412 434,164 - 434,164 (11,248)
Miscellaneous 7,460 7,460 8,775 - 8,775 1,315
Total revenues 2,657,885 2,657,885 2,579,953 - 2,579,953 (77,932)
EXPENDITURES:
Parks and recreation 2,997,038 2,901,291 2,811,439 (243,602) 2,567,837 333,454
Capital outlay 97,000 192,747 69,895 - 69,895 122,852 Total expenditures 3,094,038 3,094,038 2,881,334 (243,602) 2,637,732 456,306
Deficiency of revenues
under expenditures (436,153) (436,153) (301,381) (243,602) (57,779) 378,374
OTHER FINANCING
SOURCES (USES):
Transfers in 413,512 413,512 1,875,466 - 1,875,466 1,461,954 Transfers out (248,598) (248,598) - 243,602 243,602 492,200
Total other financing sources 164,914 164,914 1,875,466 243,602 2,119,068 1,954,154
Net change in fund balance (271,239) (271,239) 1,574,085 - 2,061,289 2,332,528
Fund deficit at beginning of year (558,230) (558,230) (1,027,034) - (1,027,034) (468,804)
Fund deficit at end of year $ (829,469) $ (829,469) $ 547,051 ~ - ~ 1,034,255 ~ 1,863,724
~S
V V
CITY OF DENTON, TEXAS Exhibit XVIII
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET TO ACTUAL SPECIAL REVENUE FUNDS: POLICE CONFISCATION FUND
FOR YEAR ENDED SEPTEMBER 30, 2007
Variance with
Adjustments - Actual on a Final Budget -
Budgeted Amounts Actual Budgetary Budgetary Positive
Original Final Amounts Basis Basis (Negative)
REVENUES: Fines and forfeitures ~ 95,042 $ 95,042 $ 102,148 $ - ~ 102,148 $ 7,106
Miscellaneous - - 16,259 - 16,259 16,259
Total revenues 95,042 95,042 118,407 - 118,407 23,365
EXPENDITURES:
Public safety 194,108 194,108 109,248 - 109,248 84,860
Capital outlay - - 9,450 - 9,450 (9,450)
Total expenditures 194,108 194,108 118,698 - 118,698 75,410
Net change in fund balance (99,066) (99,066) (291) - (291) 98,775
Fund balance at beginning of year 207,067 207,067 207,067 - 207,067 -
Fund balance at end of year ~ 108,001 $ 108,001 $ 206,776 $ - ~ 206,776 $ 98,775
v v
CITY OF DENTON, TEXAS Exhibit XIX
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET TO ACTUAL
SPECIAL REVENUE FUNDS: TOURIST AND CONVENTION FUND
FOR YEAR ENDED SEPTEMBER 30, 2007
Variance with Adjustments - Actual on a Final Budget -
BudgetedAmounts Actual Budgetary Budgetary Positive
Original Final Amounts Basis Basis (Negative)
REVENUES:
Taxes S 1,096,918 S 1,096,918 $ 1,268,627 S - ~ 1,268,627 S 171,709 Total revenues 1,096,918 1,096,918 1,268,627 - 1,268,627 171,709
EXPENDITURES:
General government 1,274,886 1,274,886 1,242,503 - 1,242,503 32,383
Total expenditures 1,274,886 1,274,886 1,242,503 - 1,242,503 32,383
Net change in fund balance (177,968) (177,968) 26,124 - 26,124 204,092
Fund balance at beginning of year 267,109 267,109 267,109 - 267,109 -
Fundbalance at end of year S 89,141 S 89,141 $ 293,233 S - ~ 293,233 S 204,092
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68
INTERNAL SERVICE FUNDS
Internal Service Funds account for the financing of goods or services provided by one department for another.
The City has five Internal Service Funds as follows:
Materials Management Fund - to account for the financing of goods and services provided by Materials
Management to other City departments. Such costs provided by Materials Management are billed to the other
departments at standard labor charges and cost of parts plus 13 percent. Actual costs include depreciation on
machinery and equipment used to provide the service.
Fleet Services Fund - to account for the financing of goods and services provided by the Municipal Garage and
Machine Shop to other City departments. Municipal Garage and Machine Shop billings include labor charges and
cost of parts plus 25 percent. Actual costs include depreciation on the building, improvements, machinery, and
equipment used to provide the service.
Motor Pool Fund - to account for the purchase of City vehicles and equipment not budgeted in other funds. These vehicles are then leased to other City departments. This fund
was dissolved as of October 1, 2007 and allocated to the
appropriate funds.
Risk Retention Fund - to account for the accumulation of resources for the payment of employee insurance claims
and insurance policies.
Technology Services Fund - to account for the accumulation of resources to provide computer programming
services, systems analysis, imaging, print shop, and office services to City departments.
69
CITY OF DENTON, TEXAS
COMBINING STATEMENT OF NET ASSETS INTERNAL SERVICE FUNDS
SEPTEMBER 30, 2007
Materials Fleet Motor Risk Management Services Pool Retention
Fund Fund Fund Fund
ASSETS:
Current assets:
Cash, cash equivalents and investments,
at fair value $ 22,882 $ 895,526 ~ - $ 5,067,983 Receivables, net of allowances:
Accrued interest - - - 56,850
Other 2,225 203,244 - -
Interfundreceivables - 1,816 - 459
Merchandise inventory 6,460,367 63,561 - - Prepaid items 140 - - -
Deferred debt issuance costs 455 404 - -
Total current assets 6,486,069 1,164,551 - 5,125,292
Noncurrent assets: Restricted assets:
Cash, cash equivalents and investments,
at fair value - 38,702 - -
Accrued interest - - - - Deferred debt issuance costs 3,832 3,274 -
Capital assets, net of accumulated depreciation 752,687 3,183,797 - 6,918
Total noncurrent assets 756,519 3,225,773 - 6,918
Total assets 7,242,588 4,390,324 - 5,132,210
LIABILITIES:
Current liabilities:
Accounts payable 273,410 438,180 - 57,843 Claims payable - - - 437,500
Compensated absences payable 47,956 48,412 - 17,407
Accrued interest 2,992 13,079 - -
Interfund payables 5,778,504 - - -
Leases payable - - - - Payable from restricted assets:
Accounts payable - - - -
Certificate and general obligation bonds 24,431 72,951 - -
Total current liabilities 6,127,293 572,622 - 512,750 Noncurrent liabilities:
Leases payable - - - -
Payable from restricted assets:
General obligation bonds payable - 53,312 - - Certificates of obligation 513,404 2,088,746 - -
Claimspayable - - - 2,879,296
Compensated absences payable 1,718 9,907 - -
Totalnoncurrent liabilities: 515,122 2,151,965 - 2,879,296 Total liabilities 6,642,415 2,724,587 - 3,392,046
NET ASSETS:
Invested in capital assets, net of related debt 219,139 1,011,168 - 6,918
Unrestricted 381,034 654,569 - 1,733,246
Total net assets ~ 600,173 $ 1,665,737 $ - ~ 1,740,164
~n
iv
Exhibit XX
Total
Technology Internal Services Service
Fund Funds
$ 923,506 $ 6,909,897
1,998 58,848
31 205,500
2,411 4,686
- 6,523,928 - 140
4,260 5,119
932,206 13,708,118
838,847 877,549
222 222 9,332 16,438
4,644,234 8,587,636
5,492,635 9,481,845
6,424,841 23,189,963
340,518 1,109,951 - 437,500
112,713 226,488
9,569 25,640
- 5,778,504
442,279 442,279
16,090 16,090
372,350 469,732
1,293,519 8,506,184
884,574 884,574
- 53,312 1,690,059 4,292,209
- 2,879,296
18,755 30,380
2,593,388 8,139,771 3,886,907 16,645,955
2,107,411 3,344,636
430,523 3,199,372
~ 2,537,934 ~ 6,544,008
71
I 1
CITY OF DENTON, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS
INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Materials Fleet Motor Risk Management Services Pool Retention
Fund Fund Fund Fund
OPERATING REVENUES: Charges for goods and services $ 5,112,358 $ 5,594,559 $ - $ 2,260,471
Miscellaneous 26,351 1,984 - 267,293
Total operating revenues 5,138,709 5,596,543 - 2,527,764
OPERATING EXPENSES:
Operating expenses before depreciation 4,881,522 5,208,460 - 2,722,289
Depreciation 19,592 118,187 - 2,579
Total operating expenses 4,901,114 5,326,647 - 2,724,868
Operating income 237,595 269,896 - (197,104)
NONOPERATING REVENUES (EXPENSES):
Investment revenue 1,261 38,405 - 244,256
Interest expense and fiscal charges (24,204) (106,285) - -
Total non-operating revenues (expenses) (22,943) (67,880) - 244,256
Income before contributions and transfers 214,652 202,016 - 47,152
Transfers in 72,437 78,593 - -
Transfers out - - (24,233,126) -
Change in net assets 287,089 280,609 (24,233,126) 47,152
Total net assets at beginning of year 313,084 1,385,128 24,233,126 1,693,012
Total net assets at end of year $ 600,173 $ 1,665,737 $ - $ 1,740,164
77.
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Exhibit XXI
Total
Technology Internal Services Service
Fund Funds
$ 5,800,312 $ 18,767,700
- 295,628
5,800,312 19,063,328
5,062,809 17,875,080
1,210,245 1,350,603
6,273,054 19,225,683
(472,742) (162,355)
77,529 361,451
~s1,2s9~ ~211,74s~
(3,730) 149,703
(476,472) (12,652)
61,392 212,422
- (24,233,126)
(415,080) (24,033,356)
2,953,014 30,577,364
$ 2,537,934 $ 6,544,008
7Z
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CITY OF DENTON, TEXAS
COMBINING STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Materials Fleet
Management Services
Fund Fund CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers $ 5,137,051 $ 5,561,970
Cash paid to employees for services (774,265) (1,090,997)
Cash paid to suppliers 4,300,381 (3,788,852)
Net cash provided by operations 62,405 682,121
CASH FLOWS FROM NONCAPITAL FINANCING
ACTIVITIES:
Transfers out - - Transfers in 72,437 78,593
Net cash provided (used) by noncapital
financing activities 72,437 78,593
CASH FLOWS FROM CAPITAL FINANCING ACTIVITIES:
Principal payments on certificates of obligation (22,980) (77,886)
Interest and fiscal charges (23,819) (106,281)
Principal payments under capital lease obligation - -
Proceeds from the sale of fixed assets - -
Acquisition and construction of capital assets 66,422 (51,889) Net cash used by capital financing activities (113,221 (236,056)
CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from sale and maturities of investment securities - -
Purchase of investment securities - -
Interestreceived on investments 1,261 38,405
Net cash provided (used) by investing activities 1,261 38,405
Net increase in cash and cash equivalents 22,882 563,063
Cash and cash equivalents at beginning of year - 371,165
Cash and cash equivalents at end of year 22,882 934,228
Investments, at fair value - -
Cash, cash equivalents and investments, at fair value $ 22,882 $ 934,228
RECONCILIATION OF OPERATING FUND INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES:
Operating income $ 237,595 $ 269,896 Adjustments:
Depreciation expense 19,592 118,187
Decrease (Increase) in receivables (1,658) (90,284)
Decrease (Increase) in interfund receivables - 55,712
Decrease (Increase) in inventories (2,486,337) (4,245)
Decrease (Increase) in prepaid items 8,726 - Increase(Decrease) in accounts payable 2,115 344,168
Increase (Decrease) in compensated absences 5,756 (2,060)
Increase (Decrease) in interfund payables 2,276,616 (9,253)
Total adjustments (175,190) 412,225
Net cash provided by operating activities $ 62,405 $ 682,121
NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES:
Noncash activity during the year consisted of the addition of a capital lease in the Tech Services fund in the amount
of $1,547,995 and the change in the fair value of investments of X188,319, $12,251, and $26,292,
for the Motor Pool, Technology Services and Risk Retention funds, respectively.
7d
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Exhibit XXII
Total
Motor Risk Technology Internal
Pool Retention Services Service
Fund Fund Fund Funds
$ - $ 2,690,132 $ 5,947,625 $19,336,778
- 17,407 (1,898,089) (3,745,944)
(57,970) (2,403,788) (2,970,211) (13,521,202)
(57,970) 303,751 1,079,325 2,069,632
(24,233,126) - - (24,233,126) - - 61,392 212,422
(24,233,126) - 61,392 (24,020,704)
(4,318,378) - (361,542) (4,780,786)
3,889 - (77,708) (203,919)
(1,624,975) - (221,142) (1,846,117)
15,705,581 - - 15,705,581
- - (594,796) (713,107) 9,766,117 - 1,255,188 8,161,652
13,082,092 478,657 487,531 14,048,280
- (500,000) (400,000) (900,000)
45,358 241,279 75,809 402,112
13,127,450 219,936 163,340 13,550,392
(1,397,529) 523,687 48,869 (239,028)
1,397,529 153,108 922,109 2,843,911
- 676,795 970,978 2,604,883
- 4,391,188 791,375 5,182,563
$ - $ 5,067,983 $ 1,762,353 $ 7,787,446
$ - $ 197,104 $ 472,742 $ 162,355
- 2,579 1,210,245 1,350,603
- - (31) (91,973)
- 162,368 147,344 365,424
- - - (2,490,582)
21,880 - - 30,606 (79,850) 318,501 187,493 772,427
- 17,407 22,053 43,156
- - 15,037 2,252,326
(57,970) 500,855 1,552,067 2,231,987
$ (57,970) $ 303,751 $ 1,079,325 $ 2,069,632
7S
V
CITY OF DENTON, TEXAS Exhibit XXIII
COMBINING STATEMENT OF NET ASSETS AGENCY FUNDS
AS OF SEPTEMBER 30, 2007
Agency Funds Employee Other Total
Payroll Insurance Agency Agency
Fund Fund Funds Funds
ASSETS:
Cash, cash equivalents and investments,
at fair value ~ 1,395,573 ~ - $ 135,310 ~ 1,530,883 Interfund receivables - - 49 49
Other assets - 115,516 79,971 195,487
Total assets ~ 1,395,573 ~ 115,516 $ 215,330 ~ 1,726,419
LIABILITIES:
Accounts payable ~ 1,395,573 ~ - $ 215,330 ~ 1,610,903
Interfund payables - 115,516 - 115,516 Total liabilities ~ 1,395,573 ~ 115,516 $ 215,330 ~ 1,726,419
7~
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CITY OF DENTON, TEXAS Exhibit XXIV
COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCY FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Balance Balance
October 1, 2006 Additions Deductions September 30, 2007 PAYROLL FUND
ASSETS
Cash and deposits $ 1,079,370 $ 71,673,092 $ 71,356,889 $ 1,395,573
Total assets $ 1,079,370 $ 71,673,092 $ 71,356,889 $ 1,395,573
LIABILITIES
Accounts payable $ 1,079,370 $ 71,673,092 $ 71,356,889 $ 1,395,573
Total liabilities $ 1,079,370 $ 71,673,092 $ 71,356,889 $ 1,395,573
EMPLOYEE INSURANCE FUND
ASSETS
Cash and deposits $ 98,163 $ 16,863,959 $ 16,962,122 $ -
Other assets - 436,903 321,387 115,516 Total assets $ 98,163 $ 17,300,862 $ 17,283,509 $ 115,516
LIABILITIES
Accounts payable $ 98,163 $ 17,185,346 $ 17,283,509 $ - Interfundpayables - 115,516 - 115,516
Total liabilities $ 98,163 $ 17,300,862 $ 17,283,509 $ 115,516
OTHER AGENCY FUNDS ASSETS
Cash, cash equivalents and
investments, at fair value $ 149,390 $ 3,210,254 $ 3,224,334 $ 135,310
Interfund receivables - 49 - 49 Other assets 76,393 232,261 228,683 79,971
Total assets $ 225,783 $ 3,442,564 $ 3,453,017 $ 215,330
LIABILITIES
Accounts payable $ 225,783 $ 3,442,344 $ 3,452,797 $ 215,330 Total liabilities $ 225,783 $ 3,442,344 $ 3,452,797 $ 215,330
TOTAL AGENCY FUNDS
ASSETS Cash, cash equivalents and
investments, at fair value $ 1,326,923 $ 91,747,305 $ 91,543,345 $ 1,530,883
Interfund receivables - 49 - 49
Other assets 76,393 669,164 550,070 195,487 Total assets $ 1,403,316 $ 92,416,518 $ 92,093,415 $ 1,726,419
LIABILITIES
Accounts payable $ 1,403,316 $ 92,300,782 $ 92,093,195 $ 1,610,903
Interfund payables - 115,516 - 115,516 Total liabilities $ 1,403,316 $ 92,416,298 $ 92,093,195 $ 1,726,419
77
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CITY OF DENTON, TEXAS Exhibit XXV
CAPITAL ASSETS USED IN THE OPERATION OF GOVERNMENTAL FUNDS
COMPARATIVE SCHEDULES BY SOURCE*
SEPTEMBER 30, 2006 AND 2007
2007 2006
Governmental funds capital assets:
Land $ 7,041,012 ~ 7,041,012
Construction in progress 13,598,086 9,335,731
Buildings 51,760,962 47,821,114 Plant, machinery and equipment 40,784,876 22,231,226
Infrastructure 174,470,357 165,754,809
Total governmental funds capital assets $ 287,655,293 ~ 252,183,892
Investments in governmental funds capital assets by source:
General fund $ 174,790,623 ~ 154,124,426 Special revenue funds 4,118,378 3,844,343
Capital projects funds 108,746,292 94,215,123
Total governmental funds capital assets $ 287,655,293 ~ 252,183,892
*This schedule presents only the capital asset balances related to governmental funds. Accordingly, the capital assets reported in internal service funds are excluded from the
above amounts. Generally, the capital assets of internal service funds are included as
governmental activities in the statement of net assets.
74
1
CITY OF DENTON, TEXAS Exhibit XXVI
CAPITAL ASSETS USED IN THE OPERATION OF GOVERNMENTAL FUNDS
SCHEDULE BY FUNCTION AND ACTIVITY*
SEPTEMBER 30, 2007
Plant, Machinery Construction
and in
Function and Activity Land Buildings Equipment Infrastructure Progress Total
General government:
Finance ~ - S 7,182 ~ 23,100 S - ~ 137,160 ~ 167,442
Legal - - 239,965 - - 239,965
Municipal court/judgelclerks - - 7,705 - 35,474 43,179 Human resources - - 27,703 - - 27,703
City managerleconomic development - 808,462 127,027 - - 935,489
Facilities management 355,470 12,449,161 4,457,960 583,921 556,757 18,403,269
Library - 9,386,386 7,493,425 14,715 146,298 17,040,824
Building inspections - - 226,560 - - 226,560
Planning/community development - 494,500 92,408 24,057 - 610,965 Engineering - - 394,327 769,237 - 1,163,564
Airport 791,571 1,917,287 303,028 4,839,889 1,133,994 8,985,769
Total general government 1,147,041 25,062,978 13,393,208 6,231,819 2,009,683 47,844,729
Public works: Traffic operations - - 1,084,608 15,277,475 510,096 16,872,179
Streets 792,665 5,000 3,797,018 141,909,250 8,694,446 155,198,379
Total public works 792,665 5,000 4,881,626 157,186,725 9,204,542 172,070,558
Parks and recreation 3,076,602 14,427,760 4,509,339 11,051,813 670,459 33,735,973
Public safety:
Fire administration - - 221,527 - - 221,527
Fire operations 2,024,704 11,866,429 8,313,039 - 1,603,537 23,807,709
Fire prevention - - 238,230 - - 238,230 Emergency medical services - - 72,187 - - 72,187
Police - 11,993 8,812,716 - 106,740 8,931,449
Animal services - 386,802 343,004 - 3,125 732,931
Total public safety 2,024,704 12,265,224 18,000,703 - 1,713,402 34,004,033
Total governmental funds
capital assets ~ 7,041,012 S 51,760,962 ~ 40,784,876 S 174,470,357 ~ 13,598,086 ~ 287,655,293
*This schedule presents only the capital asset balances related to governmental funds.
Accordingly, the capital assets reported in internal service funds are excluded from the above amounts. Generally, the capital assets of internal service funds are included as
governmental activities in the statement of net assets.
Qn
vv
CITY OF DENTON, TEXAS Exhibit XXVII CAPITAL ASSETS USED IN THE OPERATION
OF GOVERNMENTAL FUNDS
SCHEDULE OF CHANGES BY FUNCTION AND ACTIVITY*
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Governmental Governmental
Funds Capital Funds Capital Assets Assets
Function and Activity October 1, 2006 Additions Deductions September 30, 2007
General government:
Finance S 7,182 ~ 23,100 ~ - S 30,282
Legal 163,609 76,356 - 239,965
Municipal courtljudgelclerks 7,705 - - 7,705 Human resources 6,643 21,060 - 27,703
City managerleconomic development 880,438 55,051 - 935,489
Facilities management 17,474,217 378,265 (5,970) 17,846,512
Library 16,000,177 1,064,875 (170,526) 16,894,526 Building inspections 22,740 215,901 (12,081) 226,560
Planning/community development 579,328 31,637 - 610,965
Engineering 1,163,564 - - 1,163,564
Public transportation 21,506 42,055 (63,561) - Airport 7,204,964 646,811 - 7,851,775
Total general government 43,532,073 2,555,111 (252,138) 45,835,046
Public works:
Traffic operations 15,988,711 410,657 (37,285) 16,362,083 Streets 135,415,035 11,455,467 (366,569) 146,503,933
Total public works 151,403,746 11,866,124 (403,854) 162,866,016
Parks and recreation 30,822,702 2,627,013 (384,201) 33,065,514
Public safety:
Fire administration 13,842 223,325 (15,640) 221,527
Fire operations 11,510,968 10,913,806 (220,602) 22,204,172 Fire prevention 189,953 48,277 - 238,230
Emergency medical services 72,187 - - 72,187
Police 4,874,779 4,736,279 (786,349) 8,824,709
Animal services 427,911 372,099 (70,204) 729,806 Total public safety 17,089,640 16,293,786 (1,092,795) 32,290,631
Construction in progress 9,335,731 14,621,013 (10,358,658) 13,598,086
Total governmental funds capital assets S 252,183,892 ~ 47,963,047 ~ (12,491,646) S 287,655,293
This schedule presents only the capital asset balances related to governmental funds.
Accordingly, the capital assets reported in internal service funds are excluded from the above amounts. Generally, the capital assets of internal service funds are included as
governmental activities in the statement of net assets.
Q1
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STATISTICAL SECTION
This part of the City of Denton's comprehensive annual financial report presents detailed information as a context
for understanding what the information in the financial statements, note disclosures, and required supplementary
information says about the city's overall financial health.
Contents
Financial Trends
These schedules contain trend information to help the reader understand how the city's financial performance and well-being have changed over time. (Tables 1- 4)
Revenue Capacity
These schedules contain information to help the reader assess the city's most significant local revenue
source, the property tax. These tables do not include the Electric fund information due to confidentiality
of information necessary for competitive rates. (Tables 5 - 8)
Debt Capacity
These schedules present information to help the reader assess the affordability of the city's current level
of outstanding debt and the city's ability to issue additional debt in the future. (Tables 9 -12)
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the
environment within which the city's financial activities take place. (Tables 13 -14)
Operating Information
These schedules contain service and infrastructure data to help the reader understand how the information
in the city's financial report relates to the services the city provides and the activities it performs.
(Tables 15 -17)
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual
financial reports for the relevant year. The city implemented GASB Statement 34 in 2002; schedules presenting
government-wide information include information beginning in that year.
Q~
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CITY OF DENTON, TEXAS Table 1
NET ASSETS BY COMPONENT
LAST SIX FISCAL YEARS (accrual basis of accounting)
2002 2003 2004 2005 2006 2007 Governmental activities
Invested in capital assets,
net of related debt S 100,876,627 ~ 100,876,627 $ 107,754,576 S 107,112,321 ~ 107,410,289 $ 99,858,383
Restricted 428,426 428,426 296,731 451,046 439,658 886,141 Unrestricted 13,185,865 13,185,865 14,615,294 18,519,185 30,352,691 30,738,026
Total governmental activities net assets 114,490,918 114,490,918 122,666,601 126,082,552 138,202,638 131,482,550
Business-type activities Invested in capital assets,
net of related debt 163,784,452 163,784,452 172,589,102 193,657,258 213,074,701 242,015,614
Restricted 30,558,417 30,558,417 35,812,117 30,863,580 30,974,925 31,015,188
Unrestricted 78,074,629 78,074,629 78,543,929 76,726,025 90,843,185 107,837,825 Total business-type activities net assets 272,417,498 272,417,498
286,945,148 301,246,863 334,892,811 380,868,627
Primary government
Invested in capital assets, net of related debt 264,661,079 264,661,079 280,343,678 300,769,579 320,484,990 341,873,997
Restricted 30,986,843 30,986,843 36,108,848 31,314,626 31,414,583 31,901,329
Unrestricted 91,260,494 91,260,494 93,159,223 95,245,210 121,195,876 138,575,851
Total primary government net assets S 386,908,416 ~ 386,908,416 $ 409,611,749 S 427,329,415 ~ 473,095,449 $ 512,351,177
Source: Comprehensive Annual Financial Reports
85
CITY OF DENTON, TEXAS Table 2
CHANGES IN NET ASSETS
LAST SIX FISCAL YEARS (accrual basis of accounting)
2002 2003 2004 2005 2006 2007 EXPENSES
Governmental activities:
General government $16,240,418 $ 22,933,107 $ 26,411,608 $ 26,675,799 $ 22,165,661 $ 22,145,804
Public safety 27,322,153 28,837,158 30,508,765 33,642,445 36,626,635 42,161,674 Public works 13,691,514 10,274,822 11,053,131 11,986,881
12,485,281 14,008,867
Parks and recreation 7,362,939 8,419,508 9,418,580 9,912,996 10,497,241 11,564,247
Interest expense 4,252,970 4,186,051 4,494,851 4,175,466 4,333,428 4,658,128 Total governmental activities expenses 68,869,994 74,650,646 81,886,935
86,393,587 86,108,246 94,538,720
Business-type activities: Electric system 99,831,597 113,674,296 119,650,157 132,829,976 145,368,132 123,926,967
Water system 18,095,107 20,424,805 21,278,791 22,380,589 26,708,095 25,839,614
Wastewater system 15,555,687 16,560,308 18,528,348 18,808,374 19,027,926 18,785,353 Solid waste 11,658,565 12,366,910 11,301,940
13,168,880 13,454,556 15,451,025
Building inspections 1,731,031 - - - - -
Total business-type activities expenses 146,871,987 163,026,319 170,759,236 187,187,819 204,558,709 184,002,959
Total primary government expenses 215,741,981 237,676,965 252,646,171 273,581,406 290,666,955 278,541,679
PROGRAM REVENUES
Governmental activities:
Charges for services:
General government 1,428,098 3,654,387 3,417,657 3,333,866 3,904,941 3,694,869 Public safety 4,082,859 4,371,407 3,382,791 4,965,056 6,023,100 6,160,611
Public works 1,085,200 1,803,025 1,280,423 1,086,387 802,711 800,378
Parks and recreation 1,597,496 347,110 2,143,756 2,613,567 3,234,347 3,220,837
Operating grants and contributions 2,480,309 3,221,264 3,264,777 2,995,978 3,712,817 2,991,224 Capital grants and contributions 6,379,228 14,023,056 14,046,071 7,426,194 5
,536,786 5,399,220
Total governmental activities
program revenues 17,053,190 27,420,249 27,535,475 22,421,048 23,214,702 22,267,139
Business-type activities:
Charges for services: Electric system 91,315,761 105,509,934 111,742,276 129,343,037 149,419,800 128,973,477
Water system 22,352,636 24,552,658 24,331,555 24,890,289 33,436,651 27,830,767
Wastewater system 15,398,218 17,144,312 19,210,529 20,423,424 23,670,458 22,634,454 Solid waste 10,383,296 11,728,024 13,172,556
13,600,512 14,624,132 15,967,051
Building inspections 1,415,998 - - - - -
Capitalgrants and contributions 8,504,900 19,022,045 8,415,470 9,808,842 10,022,654 8,440,634
Total business-type activities program revenues 149,370,809 177,956,973 176,872,386 198,066,104 231,173,695 203,846,383
Total primary government
program revenues 166,423,999 205,377,222 204,407,861 220,487,152 254,388,397 226,113,522
NET (EXPENSE)IREVENUE
Governmental activities (51,816,804) (47,230,397) (54,351,460) (63,972,539) (62,893,544) (72,271,581)
Business-type activities 2,498,822 14,930,654 6,113,150 10,878,285 26,614,986 19,843,424 Total primary government program
net expense $ (49,317,982) $ (32,299,743) $ (48,238,310) S (53,094,254) $ (36,278,558) $ (52,428,157)
(continued)
86
CITY OF DENTON, TEXAS Table 2
CHANGES IN NET ASSETS
LAST SIX FISCAL YEARS (accrual basis of accounting)
2002 2003 2004 2005 2006 2007 GENERAL REVENUES AND OTHER CHANGES
IN NET ASSETS
Governmental activities:
Taxes: Property tax $19,075,268 $ 20,964,738 $ 23,149,916 $ 26,678,783 $ 30,000,847 $ 34,756,356
Sales tax 15,875,935 16,047,297 17,871,380 18,998,057 20,343,413 20,653,932
Franchise tax 11,930,612 12,571,989 13,215,882 14,250,484 16,499,994 15,197,943 Hotel occupancy tax 938,225 855,879 911,505 988,573 1,132,500 1,268
,627
Beverage tax 174,264 192,243 208,855 215,872 257,950 294,623
Bingo tax 20,673 28,146 21,127 25,466 24,260 23,708
Investment income 3,990,679 1,451,106 1,332,568 1,148,517 1,967,473 3,632,744 Miscellaneous 3,246,851 5,354,783 4,213,163 4,218,245 3,892,087 3,199,131
Transfers 1,073,857 1,000,305 1,410,947 864,493 895,106 (13,475,571)
Total governmental activities 56,326,364 58,466,486 62,335,343 67,388,490 75,013,630 65,551,493
Business-type activities:
Investment income 11,819,512 4,143,039 2,698,551 3,252,342 7,298,870 12,108,632 Miscellaneous 379,357 214,563 914,087 1,035,581 627,198 548,189
Transfers (1,073,857) (1,000,305) (1,410,947) (864,493) (895,106) 13,475,571
Total business-type activities 11,125,012 3,357,297 2,201,691 3,423,430 7,030,962 26,132,392
Total primary government 67,451,376 61,823,783 64,537,034 70,811,920 82,044,592 91,683,885
CHANGE IN NET ASSETS
Governmental activities 4,509,560 11,236,089 7,983,883 3,415,951 12,120,086 (6,720,088)
Business-type activities 13,623,834 18,287,951 8,314,841 14,301,715 33,645,948 45,975,816
Total primary government $ 18,133,394 $ 29,524,040 $ 16,298,724 $ 17,717,666 $ 45,766,034 $ 39,255,728
Source: Comprehensive Annual Financial Reports
87
CITY OF DENTON, TEXAS
FUND BALANCES OF GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(modified accrual basis of accounting)
1998 1999 2000 2001
General fund
Reserved for encumbrances $ 1,223,295 ~ 828,963 $ 932,374 $ 199,135
Unreserved, designated - - - -
Unreserved, undesignated 6,737,352 7,625,431 8,536,438 9,571,700 Total general fund 7,960,647 8,454,394 9,468,812 9,770,835
All other governmental funds
Reserved for:
Debt service 1,061,887 1,131,067 822,913 1,594,620
Capital projects 20,657,648 17,416,609 20,007,072 27,293,278 Encumbrances 3,545,764 2,244,559 3,349,161 3,457,022
Unreserved, undesignated reported in:
Special revenue funds 533,656 187,519 296,306 509,513
Total all other governmental funds $ 25,798,955 ~ 20,979,754 $ 24,475,452 $ 32,854,433
Source: Comprehensive Annual Financial Reports
88
Table 3
2002 2003 2004 2005 2006 2007
$ 431,528 ~ 137,051 ~ 112,292 ~ 210,818 $ 242,088 ~ -
- - - - 1,550,000 4,360,649
8,033,092 8,442,942 9,504,988 9,718,368 13,264,027 18,199,161 8,464,620 8,579,993 9,617,280 9,929,186 15,056,115 22,559,810
934,406 428,426 296,731 451,046 439,658 886,141
37,584,615 24,389,226 26,548,130 27,671,252 32,840,640 48,971,610 2,899 14,295 - - - -
2,390,065 1,678,620 3,607,200 3,614,489 5,534,701 8,896,111
$ 40,911,985 $ 26,510,567 $ 30,452,061 $ 31,736,787 $ 38,814,999 $ 58,753,862
89
CITY OF DENTON, TEXAS
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(modified accrual basis of accounting)
1998 1999 2000 2001
REVENUES:
Taxes:
Property tax $ 12,134,304 ~ 12,542,960 $ 13,957,144 $ 16,579,367
Sales tax 12,925,267 13,883,181 15,131,637 17,489,408 Hotel occupancy tax 753,226 758,272 838,152 910,907
Beverage tax 91,110 149,771 166,523 165,379
Bingo tax 28,039 25,349 21,509 26,856
Licenses and permits 708,607 373,979 441,831 233,219
Franchise fees 9,107,182 9,283,328 9,958,500 10,709,710
Fines and forfeitures 2,257,015 2,855,899 2,680,352 3,222,517 Fees for services 2,187,136 2,512,669 3,359,523 4,118,361
Investment revenue 1,921,862 1,701,496 2,695,225 1,835,650
Intergovernmental 4,617,477 4,997,170 5,763,321 6,397,702
Miscellaneous 2,200,526 1,811,201 2,646,375 1,039,093
Total revenues 48,931,751 50,895,275 57,660,092 62,728,169
EXPENDITURES:
General government 13,265,277 11,619,718 14,565,496 16,750,445
Public safety 16,756,551 19,060,713 22,679,278 23,957,206
Public works 5,447,174 5,098,539 4,888,271 6,954,265
Parks and recreation 3,989,773 4,413,869 5,341,227 6,336,352
Capital outlay 7,339,736 16,605,028 5,724,897 15,842,919 Debt service:
Principal retirement 3,230,865 4,132,192 3,601,439 3,853,087
Advance refunding escrow - - - -
Bond issuance costs - - - -
Interestand other charges 1,498,567 2,205,565 3,327,544 3,285,426
Total expenditures 51,527,943 63,135,624 60,128,152 76,979,700 Excess (deficiency) of revenues
over (under) expenditures (2,596,192) (12,240,349) (2,468,060) (14,251,531)
OTHER FINANCING SOURCES (USES):
Refunding bonds issued - 5,538,780 - -
Payment to refunded bond escrow agent - (5,538,780) - - Issuance of long-term debt 15,285,000 9,526,351 6,625,000 20,992,749
Premium on debt issuance - - - -
Proceeds of capital lease 554,625 2,159,279 - -
Transfers in 2,604,575 2,416,072 2,349,442 3,193,675
Transfers (out) (1,489,929) (3,596,807) (1,996,266) (1,253,889)
Total other financing sources (uses) 16,954,271 10,504,895 6,978,176 22,932,535
NET CHANGE IN FUND BALANCES $ 14,358,079 ~ (1,735,454) $ 4,510,116 $ 8,681,004
Debt service as a percentage of noncapital
expenditures 10.7% 13.6% 12.7% 11.7%
Source: Comprehensive Annual Financial Reports
90
Table 4
2002 2003 2004 2005 2006 2007
$ 18,894,068 $ 20,964,737 $ 22,986,590 $ 26,640,930 $ 30,019,657 $ 34,662,336
15,875,933 16,047,297 17,684,899 18,998,058 20,343,413 20,653,932 938,225 855,879 911,505 988,573 1,132,500 1,268,627
174,264 192,243 208,855 215,872 257,950 294,623
20,675 28,147 21,127 25,465 24,260 23,708
91,049 1,151,169 1,700,044 1,235,337 1,383,169 1,097,323
11,930,612 12,571,989 13,215,882 14,250,484 16,499,994 15,197,943
3,522,895 3,422,952 3,338,979 3,959,476 4,639,922 5,065,049 6,818,363 8,556,002 10,022,001 8,255,342 6,779,904 7,624,265
2,963,755 1,451,106 1,332,568 1,148,517 1,967,473 3,632,744
3,573,399 5,757,543 6,655,240 5,443,517 5,254,058 3,852,513
656,186 1,304,367 5,012,607 1,931,762 3,424,786 3,006,751
65,459,424 72,303,431 83,090,297 83,093,333 91,727,086 96,379,814
14,748,842 21,025,986 24,894,438 22,272,681 20,539,006 20,158,739
26,155,876 28,406,261 29,689,083 33,057,120 35,813,329 37,755,272
7,949,472 4,627,292 4,752,409 5,247,546 5,206,224 5,624,287
6,962,373 8,094,780 8,404,074 9,176,686 9,548,416 10,234,361
15,005,659 22,845,204 13,463,619 11,760,356 9,056,102 17,237,922
5,019,164 5,027,222 5,502,897 5,642,487 5,914,819 6,808,439
- - - 216,148 - -
- - - 293,668 70,745 314,286
4,215,673 4,487,778 4,544,502 4,018,765 4,210,628 4,389,307
80,057,059 94,514,523 91,251,022 91,685,457 90,359,269 102,522,613
(14,597,635) (22,211,092) (8,160,725) (8,592,124) 1,367,817 (6,142,799)
- 4,130,000 - 7,316,688 - 24,780,000
- (4,130,000) - (7,491,938) - - 20,120,000 6,913,483 11,805,000 9,070,000 9,550,000 -
- - - 404,361 49,644 528,630
- - - - - 1,108,131
1,454,541 2,192,680 3,496,765 3,341,047 4,095,018 12,323,132
(1,906,600) (1,181,116) (2,162,259) (2,451,402) (2,857,338) (5,154,536)
19,667,941 7,925,047 13,139,506 10,188,756 10,837,324 33,585,357
$ 5,070,306 ~ (14,286,045) ~ 4,978,781 $ 1,596,632 $ 12,205,141 ~ 27,442,558
14.2% 13.3% 12.9% 12.7% 12.5% 13.5%
91
CITY OF DENTON, TEXAS Table 5
ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY
LAST TEN FISCAL YEARS
Estimated Market Value Less: Total Taxable Total Direct
Fiscal Real Personal Tax-Exempt Assessed Tax
Year Property Property Property Value Rate
1998 ~ 2,176,249,854 $ 468,851,541 ~ 360,974,029 ~ 2,284,127,366 0.51315
1999 2,322,359,777 419,578,093 393,738,972 2,348,198,898 0.50815
2000 2,551,781,177 529,990,564 431,651,247 2,650,120,494 0.50815 2001 2,959,019,481 665,990,501 565,373,249 3,059,636,733 0.52815
2002 3,343,400,379 618,020,979 594,129,333 3,367,292,025 0.54815
2003 3,761,322,990 654,159,101 712,069,576 3,703,412,515 0.54815
2004 4,129,344,174 659,848,833 746,990,136 4,042,202,871 0.54815
2005 4,468,428,305 695,572,385 789,056,859 4,374,943,831 0.59815
2006 4,876,565,660 733,405,037 820,593,886 4,789,376,811 0.60815 2007 5,475,770,871 952,273,984 986,815,946 5,441,228,909 0.62652
Source: Denton Central Appraisal District
92
CITY OF DENTON, TEXAS Table 6
PROPERTY TAX RATES (PER X100 OF ASSESSED VALUE)
DIRECT AND OVERLAPPINGI GOVERNMENTS
LAST TEN FISCAL YEARS
Overlapping Rates
Denton
City of Denton Independent Total Direct
Fiscal Operating Debt Service Total Denton School & Overlapping
Year Rate Rate Direct Rate County District Rates 1998 0.32008 0.19307 0.51315 0.25590 1.77500 2.54405
1999 0.31187 0.19628 0.50815 0.24875 1.85000 2.60690
2000 0.31948 0.18867 0.50815 0.23504 1.70000 2.44319
2001 0.31948 0.20867 0.52815 0.23193 1.84400 2.60408
2002 0.31948 0.22867 0.54815 0.25193 1.85400 2.65408
2003 0.33816 0.20999 0.54815 0.24897 1.86400 2.66112 2004 0.34928 0.19887 0.54815 0.24717 1.86400 2.65932
2005 0.39928 0.19887 0.59815 0.25480 1.86400 2.71695
2006 0.42928 0.17887 0.60815 0.24648 1.86400 2.71863
2007 0.44765 0.17887 0.62652 0.23192 1.76400 2.62244
Source: City of Denton Tax Office, Denton County Tax Office, and Denton Independent School District
lOverlapping rates are those of local and county governments that apply to property owners with the City of Denton.
93
1
of
7It
CITY OF DENTON, TEXAS Table 7
PRINCIPAL PROPERTY TAXPAYERS
CURRENT YEAR AND NINE YEARS AGO
2007 1998
Percentage of Percentage of
Taxable Total Taxable Taxable Total Taxable
Assessed Assesed Assessed Assesed
Name of Taxpayer Value Valuer Name of Taxpayer Value Value2
Presbyterian
Hospital $ 120,766,157 2.52% Peterbilt Motors $ 44,318,837 2.10%
Denton Regional General Telephone
Hospital 77,260,797 1.61% (Verizon Southwest) 42,726,124 2.02%
Inland Western Crossing 55,500,000 1.16% Tetra Pak 25,759,393 1.22%
Denton Regional
Peterbilt Motors 52,442,834 1.09% Medical Center 22,619,858 1.07%
United Copper 49,531,076 1.03% Wal Mart 19,836,170 0.94%
Anderson
Merchandisers 46,650,576 0.97% Texas Instruments 18,592,907 0.88%
Sally Beauty 38,823,013 0.81% Golden Triangle Mall 16,617,230 0.79%
Verizon Southwest 37,109,019 0.77% Andrew Corporation 15,681,827 0.74%
Flowers Baking 31,976,228 0.67% Albertson's 12,762,134 0.60%
Golden Triangle
Mall 29,367,171 0.61% Westdale Property 12,442,108 0.59%
Total $ 539,426,871 11.24% Total $ 231,356,588 10.95%
Source: Denton Central Appraisal District
iTotal taxable assessed value for tax year 2006 (fiscal year 2007) is X5,441,228,909. Total taxable assessed value for tax year 1997 (fiscal year 1998) is X2,284,127,366.
95
CITY OF DENTON, TEXAS
PROPERTY TAX LEVIES AND COLLECTIONS
LAST THREE FISCAL YEARS
Taxes Levied Adjustments Adjusted Collected Within the
Within the to Levy in Taxes Levied Fiscal Year of the Levy Collections
Fiscal Fiscal Year Subsequent for the Percentage in Subsequent
Year of the Levy Years Fiscal Year Amount of Levy Years
2005 $ 26,457,399 $ 92,487 $ 26,549,886 $ 26,016,239 97.99% $ 402,638
2006 29,545,033 48,117 29,593,150 29,162,978 98.55% 251,134 2007 34,302,228 - 34,302,228 33,872,404 98.75% -
Source: City of Denton Tax Office and Denton Central Appraisal District
Only three years of data included due to inability to obtain correct data from previous tax software.
96
Table 8
Total Collections to Date
Percentage
Amount of Levy
$ 26,418,877 99.51
29,414,112 99.40% 33,872,404 98.75%
97
CITY OF DENTON, TEXAS
RATIO OF OUTSTANDING DEBT BY TYPE
LAST SEVEN FISCAL YEARS
Governmental Activities Business-Type Activities
General Certificates General Certificates
Fiscal Obligation of Other Revenue Obligation of Other
Year Bonds Obligation Obligations Bonds Bonds Obligation Obligations
2001 $ 49,950,882 $ 21,924,825 ~ 1,022 $ 211,035,241 $ 1,759,622 $ 8,504,895 ~ 3,148,744
2002 58,663,791 27,628,284 635,442 274,875,129 1,508,017 12,188,878 3,141,222 2003 59,721,870 30,148,929 696,508 304,366,352 2,191,168
11,765,612 3,328,798
2004 55,893,370 40,540,162 1,244,678 293,105,000 2,046,630 11,325,838 3,141,222
2005 58,870,849 41,791,588 2,210,846 281,120,000 3,904,151 9,233,412 3,141,222
2006 58,742,900 46,700,000 3,559,742 277,305,000 3,582,100 11,975,000 3,141,222
2007 70,650,317 51,355,100 2,393,684 281,750,000 3,099,683 13,889,900 7,032,986
Source: Comprehensive Annual Financial Reports
Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements.
1See Table 13 for personal income and population data.
98
Table 9
Total Percentage
Primary of Personal Per
Government Income Capita
$ 296,325,231 0.01879% 3,471.19
378,640,763 0.02248% 4,190.59 412,219,237 0.02006% 4,399.49
407,296,900 0.01889% 4,143.91
400,272,068 0.01764% 3,877.85
405,005,964 0.01680% 3,736.87
430,171,670 0.01661% 3,780.07
99
CITY OF DENTON, TEXAS Table 10
RATIO OF GENERAL BONDED DEBT OUTSTANDING
LAST TEN FISCAL YEARS
General Bonded Debt Outstanding Percentage of
General Certificates Less: Amounts Actual Taxable
Fiscal Obligation of Available in Debt Value of Per
Year Bonds Obligation Service Fund Total Property) Capital
1998 $ 31,806,730 $ 16,640,000 $ 1,061,887 $ 47,384,843 2.07% 648.66
1999 39,056,730 19,945,000 1,131,067 57,870,663 2.46% 768.53 2000 40,105,923 20,881,000 822,913 60,164,010 2.27% 725.08
2001 51,569,223 30,571,000 1,594,620 80,545,603 2.63% 943.52
2002 60,185,495 39,806,000 934,406 99,057,089 2.94% 1,096.31
2003 61,913,038 41,978,000 428,426 103,462,612 2.79% 1,104.23
2004 57,940,000 51,866,000 296,731 109,509,269 2.71% 1,114.17
2005 62,775,000 51,025,000 451,046 113,348,954 2.59% 1,098.13 2006 62,325,000 58,675,000 439,658 120,560,342 2.52% 1,112.38
2007 73,750,000 65,245,000 886,141 138,108,859 2.54% 1,213.61
Source: Comprehensive Annual Financial Reports
Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements.
1See Table 5 for property value data.
2See Table 13 for population data.
100
CITY OF DENTON, TEXAS Table 11
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
AS OF SEPTEMBER 30, 2007
Estimated
Estimated Share of
Debt Percentage Overlapping
Governmental Unit Outstanding Applicable) Debt
Debt repaid with property taxes:
Denton Independent School District $ 493,573,294 66.47% ~ 328,078,169
Denton County 271,923,033 12.90% 35,078,071
Aubrey Independent School District 46,029,850 0.01 % 4,603
Krum Independent School District 40,822,802 1.78% 726,646
Argyle Independent School District 36,679,599 7.30% 2,677,611 Sanger Independent School District 32,356,468 0.11 % 35,592
Ponder Independent School District 19,805,853 2.36% 467,418
Pilot Point Independent School District 19,674,011 0.12% 23,609
Subtotal, overlapping debt 367,091,719
City of Denton, direct debt 100.00% 122,005,417
Total direct and overlappping debt $ 489,097,136
Source: "Texas Municipal Report" as of September 30, 2006, prepared by the Municipal Advisory Council.
Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries
of the city. This schedule estimates the portion of the outstanding debt of those overlapping governments
that is borne by the residents and businesses of the City of Denton. This process recognizes that, when
considering the City of Denton's ability to issue and repay long-term debt, the entire debt burden borne by
the residents and businesses should betaken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each
overlapping government.
1The percentage of overlapping debt applicable is estimated using taxable assessed property values.
Applicable percentages were estimated by determining the portion of the overlapping government's
taxable assessed value that is within the City of Denton's boundaries and dividing it by the overlapping
government's total taxable assessed value.
101
CITY OF DENTON, TEXAS
PLEDGED REVENUE COVERAGE
LAST SIX FISCAL YEARS
Utility System Revenue Bonds
Less:
Fair Market Less:
Value Operating
Adjustment Expenses Fiscal Operating Investment to Investment Impact Fee Before
Year Revenue Revenue Revenue2 Revenue Depreciation
2002 ~ 124,769,615 $ 8,406,425 ~ 2,515,297 ~ 4,294,000 $ 113,557,718
2003 140,450,819 4,320,188 (2,599,123) 5,150,000 125,351,837
2004 148,512,689 2,618,296 (1,523,523) 6,771,671 134,885,329
2005 170,450,120 3,114,254 (2,027,258) 4,206,630 150,549,007
2006 200,970,560 7,061,556 721,058 5,556,349 166,537,867 2007 173,879,713 11,390,142 2,710,742 5,558,985 142,890,603
Source: Comprehensive Annual Financial Reports
The Utility System includes the Electric, Water, and Wastewater funds.
2For the coverage calculation, the fair market adjustment to the value of investments is excluded.
3For the coverage calculation, franchise fees and return on investment payments to the General Fund
are excluded from operating expenses.
4Revenue bond covenants require a times coverage of 1.25 or greater.
102
Table 12
Add:
Franchise Fees
and Return Debt Service
on Investment Net Paid to Available Times
General Fund3 Revenue Principal Interest Coverage4
$ 8,487,570 ~ 29,884,595 ~ 7,345,000 $ 12,130,021 1.53
9,207,505 36,375,798 9,965,000 14,324,178 1.50
9,596,617 34,137,467 11,255,000 15,979,950 1.25
10,922,442 40,171,697 12,545,000 14,429,925 1.49
12,839,184 59,168,724 12,330,000 13,798,811 2.26 11,283,647 56,511,142 13,325,000 12,265,461 2.21
103
CITY OF DENTON, TEXAS Table 13
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN FISCAL YEARS
Fiscal Estimated Personal Per Capita Average Grade School University Unemployment
Year Population) Income Income2 Age3 Enrollment4 Enrollments Rate6
1998 73,050 $ 877,549,650 12,013 30.7 12,986 33,113 2.4%
1999 75,300 904,578,900 12,013 30.7 13,283 33,407 2.7% 2000 82,976 996,790,688 12,013 26.8 13,667 33,317 3.1
2001 85,367 1,577,069,958 18,474 26.8 14,408 34,026 4.7%
2002 90,355 1,684,488,265 18,643 26.8 13,600 36,985 7.4%
2003 93,697 2,054,962,604 21,932 26.9 15,128 38,612 7.4%
2004 98,288 2,155,652,416 21,932 33.0 16,932 39,618 5.8%
2005 103,220 2,269,291,700 21,985 33.0 18,395 41,204 3.3% 2006 108,381 2,410,068,297 22,237 33.0 19,701 43,120 3.5%
2007 113,800 2,590,088,000 22,760 33.0 20,880 46,336 3.4%
Sources:
1City of Denton Planning and Development Department estimate
2United States Census and Denton Chamber of Commerce
3United States Census and Denton Chamber of Commerce
DDenton Independent School District
UUnvversity of North Texas' and Texas Woman's University's Denton campus enrollment
TTexas Workforce Commission estimate
104
CITY OF DENTON, TEXAS Table 14
PRINCIPAL EMPLOYERS
CURRENT YEAR AND NINE YEARS AGO
2007 1998
Percentage Percentage
of Total City of Total City
Name of Employer Employees Employment Name of Employer Employees Employment
University of North Texas 7,351 12.14% University of North Texas 5,500 10.26%
Denton Independent School 2,600 4.29% Boeing Electrics 2,200 4.10% District
Paccar, Inc. 1,750 2.89% Denton Independent 1,648 3.07%
(Peterbilt Motors) School District
Denton State School 1,450 2.39% Denton State School 1,497 2.79%
Denton County 1,441 2.38% Peterbilt Motors 1,400 2.61%
(in Denton)
City of Denton 1,244 2.05% Texas Woman's 1,300 2.42%
University
Texas Woman's University 1,159 1.91% Denton County 1,132 2.11%
Federal Emergency 1,100 1.82% City of Denton 1,000 1.86%
Management Agency
Denton Regional Medical 800 1.32% Denton Regional Medical 850 1.59%
Center Center
Denton Community 750 1.24% Victor Equipment 700 1.31%
(Presbyterian) Hospital
Total 19,645 32.43% Total 17,227 32.12%
Source: Denton Chamber of Commerce
105
CITY OF DENTON, TEXAS
FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTIONIPROGRAM
LAST TEN FISCAL YEARS
Full-time Equivalent Employees for Fiscal Year
Function /Program 1998 1999 2000 2001 2002
General government 195.28 169.41 179.03 200.53 203.75
Public safety
Police 159.79 170.39 173.29 176.62 178.14 Fire 121.25 130.25 145.25 151.25 151.25
Animal services 8.00 8.00 8.00 8.00 8.00
Public works 54.00 52.00 52.00 61.00 83.00
Parks and recreation 92.32 96.91 108.15 115.15 117.17
Electric system 145.20 128.75 128.75 136.75 107.50
Water system 60.69 103.71 106.71 110.21 112.71 Wastewater system 72.63 72.40 72.90 81.00 76.00
Solid waste 66.08 66.75 69.25 88.50 88.50
Materials management 10.00 10.00 10.00 13.00 13.00
Fleet services 14.50 15.50 16.50 18.50 18.50
Technology services 24.55 26.25 30.75 29.75 34.75
Risk Retention - - - - - Total 1,024.29 1,050.32 1,100.58 1,190.26 1,192.27
Source: City of Denton Budget Office
106
Table 15
2003 2004 2005 2006 2007
202.75 202.75 211.75 192.50 192.38
180.14 183.73 198.23 206.23 212.23 152.25 152.25 160.25 162.25 162.25
8.00 8.00 8.00 8.00 8.00
84.00 84.00 77.00 37.00 38.00
136.37 152.34 149.62 141.85 142.07
108.50 109.50 110.50 110.50 112.00
113.71 120.00 130.00 161.75 164.50 79.12 80.12 83.22 83.12 82.87
88.50 88.50 82.50 85.00 87.00
15.00 15.00 14.00 12.50 12.50
20.00 19.00 16.00 17.00 18.00
33.75 33.75 29.75 26.00 24.50
- - - - 5.00 1,222.09 1,248.94 1,270.82 1,243.70 1,261.30
107
CITY OF DENTON, TEXAS
OPERATING INDICATORS BY FUNCTION/PROGRAM
LAST TEN FISCAL YEARS
Fiscal Year
Function l Program 1998 1999 2000 2001
Public Safety
Police
Calls for service 46,122 50,194 57,466 57,704
Traffic citations issued 28,375 38,882 29,838 38,628
Fire
Fire calls for service 2,200 2,200 2,200 2,200
EMS calls for service 6,603 6,603 6,445 7,200
Inspections (Businesses) 4,000 4,300 3,540 2,794
Animal Services
Animals sheltered 4,973 4,974 4,304 5,234
Animals adopted, transferred, or returned 1,973 2,266 2,171 2,269
Public Works
Street repaving (square yards) 60,000 50,000 43,978 50,000
Pot holes repaired 14,000 3,000 4,000 5,000
Cutouts base failures (square feet) 180,000 200,000 108,458 150,000
Crack seal maintenance (linear feet) NA NA NA NA
Parks and Recreation
Attendance Leisure Services NA 957,743 980,000 869,960
Water Park NA NA NA NA
Total Acres Maintained NA 1,378 1,846 1,916
Water System
Number of customers 17,924 18,824 21,057 22,600
Annual finished water production (in thousand gallons) 5,165,598 4,769,096 5,386,680 4,966,603
Wastewater System
Number of customers 17,798 18,258 19,324 20,913
Annual wastewater discharge (in thousand gallons) 4,398,196 4,208,290 4,756,640 5,190,410
Solid Waste
Number of customers (residential and commercial) 19,342 19,842 21,550 23,265
MSW Landfilled (tons) 103,080 111,920 111,850 110,172
Recycling collections (tons) 13,124 16,768 16,732 14,060
Source: Various city departments
Note: Fire calls for 1997-2002 were rounded to the nearest hundred by department. ~ linear feet
2 lane miles of repaving and reconstruction
3 curbside residential recycling program introduced
108
Table 16
2002 2003 2004 2005 2006 2007
68,869 68,727 69,312 73,154 73,346 74,397
39,138 38,181 34,804 36,757 39,483 31,131
2,800 2,894 2,917 3,013 3,495 3,539
7,200 8,808 7,012 6,527 6,840 6,544
2,802 3,114 3,000 3,727 3,882 3,144
5,098 4,769 5,166 4,320 4,443 5,427
3,015 1,487 1,777 2,091 2,167 2,297
107,956 211,113 32.41 ~ 19.44 ~ 32 ~ 7,841 ~
8,304 5,162 4,004 5,479 3,971 8,153
165,335 94,876 79,010 124,442 171,543 44,566
NA NA NA 40,338 79,314 42,624
893,710 1,026,309 981,883 952,866 985,778 1,048,500
NA 102,637 107,198 141,495 162,039 163,000
2,084 2,107 2,190 2,208 2,262 2,293
24,000 25,099 26,271 27,583 28,805 29,783
5,070,200 5,636,745 5,369,939 5,901,750 7,097,403 5,671,124
22,275 23,499 24,441 25,690 26,951 28,020
4,687,960 4,689,450 4,967,440 5,039,240 4,402,420 5,174,100
23,783 24,254 25,154 26,062 27,805 28,954
107,901 107,061 122,113 122,477 114,060 128,644
11,965 15,322 3 16,353 16,195 17,762 21,179
109
CITY OF DENTON, TEXAS
CAPITAL ASSET STATISTICS BYFUNCTION/PROGRAM
LAST TEN FISCAL YEARS
Fiscal Year
Function /Program 1998 1999 2000 2001 2002
Public safety
Police
Police stations 1 1 1 1 1 Police patrol units 68 97 103 104 138
Fire
Fire stations 6 6 6 6 6
Emergency vehicles 19 19 16 20 20
Animal services
Animals shelters 1 1 1 1 1
Public works
Lane miles added per year NA NA 74.02 36.30 32.15
Streetlights NA NA NA 5,426 5,713
Parks and recreation Parks NA 26 26 27 28
Park acreage NA 743 743 813 981
Recreation centers NA 10 10 10 10
Water system
Water mains (miles) 351 380 422 433 458 Raw water (in thousand gallons) 5,443,622 5,159,230 5,647,014 5,185,568 5,472,708
Wastewater system
Wastewater mains (miles) 347 360 393 396 414
Maximum daily capacity (in thousand gallons) 15 15 15 15 15
Solid waste
Landfills 1 1 1 1 1
Source: Various city departments
110
Table 17
2003 2004 2005 2006 2007
1 1 1 1 1 141 143 148 149 149
6 6 6 6 7
21 22 21 22 24
1 1 1 1 1
34.95 14.79 24.56 25.34 22.66
6,086 6,931 7,104 7,118 7,008
33 34 34 37 30
1,177 1,240 1,205 1,272 1,210
11 12 13 13 13
478 497 511 520 530 6,168,039 6,046,070 6,234,076 7,322,361 5,801,994
426 442 452 459 470
15 21 21 21 21
1 1 1 1 1
111
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11G
CITY OF DENTON, TEXAS Exhibit XXVIII
GENERAL FUND COMPARATIVE BALANCE SHEET
SEPTEMBER 30, 2007 AND 2006
2007 2006 ASSETS:
Cash and cash equivalents $ 19,584,095 ~ 6,738,492
Receivables, net of allowances:
Taxes 4,155,269 3,937,328
Accrued interest 162,149 107,604
Other 2,251,491 1,598,062 Due from other governments - 159,448
Interfund receivables 471,252 1,752,973
Total assets $ 26,624,256 ~ 14,293,907
LIABILITIES AND FUND BALANCES
LIABILITIES: Accounts payable $ 2,423,114 ~ 1,444,481
Interfund payables - 1,418,596
Due to other governments 18 -
Other liabilities 627,775 653,912
Deferred revenue 1,018,796 847,732
Total liabilities 4,069,703 4,364,721
FUND BALANCES:
Reserved for encumbrances - 210,818
Unreserved, designated 4,360,649 -
Unreserved, undesignated 18,199,161 9,718,368
Total fund balances 22,559,810 9,929,186
Total liabilities and fund balances $ 26,629,513 ~ 14,293,907
~1~
0 0v
CITY OF DENTON, TEXAS BALANCE SHEET -TRADITIONAL FORMAT
ENTERPRISE FUNDS
SEPTEMBER 30, 2007
Electric Water Wastewater Denton Utility System System System Systems
Fund Fund Fund Subtotal
ASSETS:
Current: Cash, cash equivalents and investments,
at fair value S 78,509,502 $ 19,615,484 ~ 7,752,223 S 105,877,209
Receivables, net of allowances:
Accounts 6,876,626 1,594,954 1,140,402 9,611,982 Unbilled utility service 5,878,927 1,168,208 901,675 7,948,810
Accrued interest 783,341 211,883 116,983 1,112,207
Interfund receivables 486,759 91,843 189,644 768,246 Other receivables - 1,970 - 1,970
Prepaid expenses - - 3,935 3,935
Deferred charges 14,375 - - 14,375
Deferred debt issuance costs 83,566 111,082 55,789 250,437 Restricted assets:
Cash, cash equivalents and investments,
at fair value 36,564,844 54,034,427 26,224,966 116,824,237
Escrow deposit 126,311 97,696 57,692 281,699 Interfund receivables 4,321,244 209,542 105,293 4,636,079
Other receivable - 26,337 - 26,337
Accrued interest 492,610 439,858 206,613 1,139,081 Noncurrent:
Deferred Debt Issuance Cost 575,891 964,061 318,605 1,858,557
Fixed assets, net of accumulated depreciation 100,383,585 185,169,551 142,353,969 427,907,105
Total assets S 235,097,581 $ 263,736,896 ~ 179,427,789 S 678,262,266
LIABILITIES: Current:
Accounts payable S 18,611,735 $ 251,384 ~ 303,597 S 19,166,716
Compensated absences payable 467,766 494,647 241,549 1,203,962
Leases payable - - 135,929 135,929 Unearned revenue 81,325 - - 81,325
Deposits 3,239,502 224,819 - 3,464,321
Payable from restricted assets: Accounts payable 52,084 319,933 410,449 782,466
Retainage payable - 228,649 97,125 325,774
Accrued interest 1,356,773 2,148,593 951,113 4,456,479
Revenue and general obligation bonds 5,496,141 5,926,483 4,125,689 15,548,313 Noncurrent: -
Payablefrom restricted assets:
Arbitrage payable 24,692 5,525 17,037 47,254
Leases payable - - 190,098 190,098 General obligation bonds payable - - - -
Certificates of obligation - - - -
Revenuebonds payable, net of discount 82,753,134 133,623,217 56,606,213 272,982,564
Deferred amount on refunding (2,645,894) (5,226,934) (1,370,727) (9,243,555) Notes payable - 3,141,222 - 3,141,222
Compensated absences payable 50,915 35,444 30,008 116,367
Landfill closure/postclosure costs - - - -
Totalliabilities 109,488,173 141,172,982 61,738,080 312,399,235 FUND EQUITY:
Retained earnings:
Reserved:
Debt service 10,737,987 12,375,006 5,984,166 29,097,159 Rate stabilization 53,925,914 12,000,000 5,000,000 70,925,914
Water tower painting - 750,000 - 750,000
Infrastructure financing 27,330,152 38,347,027 17,384,764 83,061,943
0 & M contingency 300,000 500,000 300,000 1,100,000 Capital construction 500,000 750,000 500,000 1,750,000
TXDOT highway relocations - 2,700,000 - 2,700,000
Unreserved 32,815,355 55,141,881 88,520,779 176,478,015
Total fund equity 125,609,408 122,563,914 117,689,709 365,863,031 Total liabilities and fund equity S 235,097,581 $ 263,736,896 ~ 179,427,789 S 678,262,266
11d
1 -r
Exhibit XXIX
Solid Total Waste Enterprise
Fund Funds
S 7,117,228 ~ 112,994,437
883,717 10,495,699 671,244 8,620,054
62,683 1,174,890
13,706 781,952 - 1,970
- 3,935
- 14,375
21,645 272,082
7,065,198 123,889,435
434,574 716,273 - 4,636,079
- 26,337
131,912 1,270,993
105,339 1,963,896
21,622,270 449,529,375
S 38,129,516 ~ 716,391,782
S 305,749 ~ 19,472,465
240,500 1,444,462
1,043,641 1,179,570 - 81,325
41,148 3,505,469
419,738 1,202,204
18,213 343,987
105,021 4,561,500
2,052,245 17,600,558
- 47,254
2,522,096 2,712,194 2,670,243 2,670,243
12,323,127 12,323,127
- 272,982,564
(96,130) (9,339,685) - 3,141,222
75,133 191,500
3,974,462 3,974,462
25,695,186 338,094,421
- 29,097,159 2,500,000 73,425,914
- 750,000
6,611,509 89,673,452
300,000 1,400,000 400,000 2,150,000
- 2,700,000
2,622,821 179,100,836
12,434,330 378,297,361 S 38,129,516 ~ 716,391,782
11~
IIv
CITY OF DENTON, TEXAS
STATEMENT OF REVENUES, EXPENSES AND CHANGES
IN RETAINED EARNINGS -TRADITIONAL FORMAT
ENTERPRISE FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2007
Denton
Electric Water Wastewater Utility
System System System Systems
Fund Fund Fund Subtotal
REVENUES:
Utility services $ 124,727,137 ~ 20,624,118 $ 20,103,918 $ 165,455,173
Other fees 4,246,340 3,057,387 1,120,813 8,424,540
Total operating revenues 128,973,477 23,681,505 21,224,731 173,879,713
OPERATING EXPENSES: Operating expenses before depreciation 116,650,348 15,167,255 11,073,000 142,890,603
Depreciation 4,255,715 5,033,989 5,087,019 14,376,723
Total operating expenses 120,906,063 20,201,244 16,160,019 157,267,326
Operating income 8,067,414 3,480,261 5,064,712 16,612,387
NON-OPERATING REVENUES (EXPENSES):
Investment revenue 5,934,612 3,623,792 1,831,738 11,390,142
Interest expense and fiscal charges (3,049,271) (5,665,918) (2,641,555) (11,356,744)
Impact fee revenue - 4,149,262 1,409,723 5,558,985
Gain (loss) on disposal of capital assets (45,703) (120,160) (9,220) (175,083)
Other non-operating revenues (expenses) - 136,107 28,634 164,741 Total non-operating revenues (expenses) 2,839,638 2,123,083 619,320 5,582,041
Income before contributions and transfers 10,907,052 5,603,344 5,684,032 22,194,428
CONTRIBUTIONS AND TRANSFERS:
Capital contributions - 2,246,754 6,193,880 8,440,634 Transfers in 5,154,417 3,102,983 3,901,029 12,158,429
Transfers out (74,829) (109,863) (923,197) (1,107,889)
Total contributions and transfers 5,079,588 5,239,874 9,171,712 19,491,174
Increase in retained earnings 15,986,640 10,843,218 14,855,744 41,685,602
RETAINED EARNINGS:
Retained earnings at beginning of year 109,622,768 111,720,696 102,833,965 324,177,429
Retained earnings at end of year $ 125,609,408 ~ 122,563,914 $ 117,689,709 $ 365,863,031
116
Exhibit X;XX
Solid Total
Waste Enterprise
Fund Funds
$ 15,809,048 ~ 181,264,221
158,003 8,582,543
15,967,051 189,846,764
11,796,867 154,687,470
2,910,127 17,286,850
14,706,994 171,974,320
1,260,057 17,872,444
718,490 12,108,632
(774,935) (12,131,679)
- 5,558,985
319,857 144,774
238,674 403,415 502,086 6,084,127
1,762,143 23,956,571
- 8,440,634 2,486,595 14,645,024
(61,564) (1,169,453)
2,425,031 21,916,205
4,187,174 45,872,776
8,247,156 332,424,585
$ 12,434,330 $ 378,297,361
117
CITY OF DENTON, TEXAS
STATEMENT OF CASH FLOWS -TRADITIONAL FORMAT
ENTERPRISE FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Denton
Electric Water Wastewater Utility
Fund Fund Fund Systems
System System System Subtotal
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers $ 131,199,927 $ 23,968,104 $ 21,316,526 $ 176,484,557
Cash paid to employees for services (5,959,780) (9,155,896) (4,638,448) (19,754,124) Cash paid to suppliers (115,521,194) (6,610,552) (6,035,806) (128,167,552)
Net cash provided by operating activities 9,718,953 8,201,656 10,642,272 28,562,881
CASH FLOWS FROM NONCAPITAL FINANCING
ACTIVITIES:
Transfers out (74,829) (109,862) (923,197) (1,107,888)
Transfers in 5,154,417 3,102,983 3,901,029 12,158,429
Net cash used by noncapital financing activities 5,079,588 2,993,121 2,977,832 11,050,541
CASH FLOWS FROM CAPITAL FINANCING ACTIVITIES:
Principal payments on capital debt (5,321,239) (5,146,586) (3,530,246) (13,998,071)
Interest and fiscal charges (2,978,544) (5,897,696) (2,680,390) (11,556,630)
Principal payments under capital lease obligation - - (130,340) (130,340)
Proceeds from issuance of capital debt 7,051,915 9,692,632 - 16,744,547 Proceeds from sale of capital assets - - - -
Proceeds from impact fees - 4,149,262 1,409,723 5,558,985
Acquisition and construction of capital assets (13,442,379) (6,312,592) (7,064,986) (26,819,957)
Net cash used by capital financing activities (14,690,247) (3,514,980) (11,996,239) (30,201,466)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale and maturities of investment securities 295,130,509 39,859,562 25,754,151 360,744,222 Purchase of investment securities (300,359,367) (46,255,000)
(22,562,000) (369,176,367)
Interest received on investments 5,473,772 3,473,212 1,731,207 10,678,191
Net cash provided (used) by investing activities 244,914 (2,922,226) 4,923,358 2,246,046
Net increase (decrease) in cash and cash equivalents 353,208 4,757,571 6,547,223 11,658,002
Cash and cash equivalents at beginning of year 10,353,381 1,350,316 1,618,430 13,322,127
Cash and cash equivalents at end of year 10,706,589 6,107,887 8,165,653 24,980,129
Investments, at fair value 104,367,757 67,542,024 25,811,536 197,721,317
Cash, cash equivalents and investments, at fair value $ 115,074,346 $ 73,649,911 $ 33,977,189 $ 222,701,446
118
Exhibit X;XXI
Solid Total
Waste Enterprise
Fund Funds
~ 15,575,560 ~ 192,060,117
(6,923,301) (26,677,425) (5,334,308) (133,501,860)
3,317,951 31,880,832
(61,564) (1,169,452)
2,486,595 14,645,024
2,425,031 13,475,572
(1,167,905) (15,165,976)
(757,730) (12,314,360)
(851,429) (981,769)
2,631,889 19,376,436 319,857 319,857
5,558,985
(4,371,496) (31,191,453)
(4,196,814) (34,398,280)
6,958,623 367,702,845 (8,300,000) (377,476,367)
627,200 11,305,391
(714,177) 1,531,869
831,991 12,489,993
1,365,106 14,687,233
2,197,097 27,177,226
11,985,329 209,706,646
~ 14,182,426 ~ 236,883,872
(continued)
119
CITY OF DENTON, TEXAS
STATEMENT OF CASH FLOWS -TRADITIONAL FORMAT ENTERPRISE FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Denton
Electric Water Wastewater Utility
Fund Fund Fund Systems
System System System Subtotal
RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED BY OPERATING
ACTIVITIES:
Operating income $ 8,067,414 $ 3,480,261 ~ 5,064,712 $ 16,612,387
Adjustments:
Depreciation expense 4,255,715 5,033,989 5,087,019 14,376,723 Decrease (Increase) in receivables 3,224,274 19,541 58,605 3,302,420
Decrease (Increase) in interfund receivables (997,824) 267,059 33,190 (697,575)
Decrease (Increase) in prepaid items (13,422) 2,170 5,509 (5,743)
Increase (Decrease) in accounts payable (4,800,863) (226,342) 485,433 (4,541,772) Increase in compensated absences payable 51,323 36,242 (14,212) 73,353
Increase in closure/postclosure liability - - - -
Increase (Decrease) in interfund payables (67,664) (411,264) (77,984) (556,912)
Total adjustments 1,651,539 4,721,395 5,577,560 11,950,494
Net cash provided by operating activities $ 9,718,953 $ 8,201,656 ~ 10,642,272 $ 28,562,881
NONCASH CAPITAL, INVESTING AND FINANCING ACTIVITIES:
Noncash activity during the year consisted of contributed capital assets for the Water and Wastewater funds in the amounts
of $2,246,754 and $6,193,880, respectively; the change in the fair value of investments of $1,668,600, $664,497, X377,645 and $122,447 for the Electric, Water, Wastewater and Solid
Waste funds, respectively; the addition of
capital leases in Solid Waste of $1,313,791.
~~n
0 Ahm v
Exhibit XXXI
Solid Total
Waste Enterprise
Fund Funds
$ 1,260,057 $ 17,872,444
2,910,127 17,286,850 (549,091) 2,753,329
157,601 (539,974)
- (5,743)
272,269 (4,269,503) 2,527 75,880
285,054 285,054
1,020,593 (1,577,505)
2,057,894 14,008,388
$ 3,317,951 $ 31,880,832
0
CITY OF DENTON, TEXAS
BALANCE SHEET -TRADITIONAL FORMAT
INTERNAL SERVICE FUNDS
SEPTEMBER 30, 2007 Materials Fleet Motor Risk
Management Services Pool Retention
Fund Fund Fund Fund
ASSETS:
Current assets:
Cash, cash equivalents and investments, at fair value S 22,882 S 895,526 ~ - ~ 5,067,983
Accrued interest receivable - - - 56,850
Other receivables 2,225 203,244 - -
Interfund receivables - 1,816 - 459 Merchandise inventory 6,460,367 63,561 - -
Prepaid items 140 - - -
Deferreddebt issuance costs 4,287 3,678 - -
Restricted assets:
Cash, cash equivalents and investments, at fair value - 38,702 - -
Accruedinterest - - - -
Totalcurrent assets 6,489,901 1,206,527 - 5,125,292
Noncurrent assets:
Fred assets, net of accumulated depreciation 752,687 3,183,797 - 6,918
Total assets S 7,242,588 S 4,390,324 ~ - ~ 5,132,210
LIABILITIES:
Current liabilities: Accounts payable S 273,410 S 438,180 ~ - ~ 57,843
Claims payable - - - 437,500
Compensated absences payable 47,956 48,412 - 17,407
Accrued interest 2,992 13,079 - -
Interfund payables 5,778,504 - - - Leases payable - - - -
Payablefrom restricted assets:
Accounts payable - - - -
Certificate and general obligation bonds 24,431 72,951 - - Totalcurrent liabilities 6,127,293 572,622 - 512,750
Noncurrent liabilities:
Leases payable - - - -
Payablefrom restricted assets:
General obligation bonds payable - 53,312 - -
Certificates of obligation 513,404 2,088,746 - - Claims payable - - - 2,879,296
Compensated absences payable 1,718 9,907 - -
Totalliabilities 6,642,415 2,724,587 - 3,392,046
FUND EQUITY:
Retained earnings: Reserved for future claims - - - 1,733,246
Unreserved, undesignated 600,173 1,665,737 - 6,918
Total fund equity 600,173 1,665,737 - 1,740,164
Total liabilities and fund equity S 7,242,588 S 4,390,324 ~ - ~ 5,132,210
122
Exhibit XXXII
Technology Internal
Services Service
Fund Funds
~ 923,506 ~ 6,909,897
1,998 58,848
31 205,500
2,411 4,686 - 6,523,928
- 140
13,592 21,557
838,847 877,549
222 222
1,780,607 14,602,327
4,644,234 8,587,636
~ 6,424,841 ~ 23,189,963
~ 340,518 ~ 1,109,951
- 437,500
112,713 226,488
9,569 25,640
- 5,778,504 442,279 442,279
16,090 16,090
372,350 469,732 1,293,519 8,506,184
884,574 884,574
- 53,312
1,690,059 4,292,209 - 2,879,296
18,755 30,380
3,886,907 16,645,955
- 1,733,246
2,537,934 4,810,762
2,537,934 6,544,008
~ 6,424,841 ~ 23,189,963
123
CITY OF DENTON, TEXAS
STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN RETAINED EARNINGS -TRADITIONAL FORMAT
INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2007
Materials Fleet Motor Risk
Management Services Pool Retention Fund Fund Fund Fund
OPERATING REVENUES:
Charges for goods and services $ 5,112,358 ~ 5,594,559 ~ - ~ 2,260,471
Miscellaneous 26,351 1,984 - 267,293
Total operating revenues 5,138,709 5,596,543 - 2,527,764
OPERATING EXPENSES: Operating expenses before depreciation 4,881,522 5,208,460 - 2,722,289
Depreciation 19,592 118,187 - 2,579
Total operating expenses 4,901,114 5,326,647 - 2,724,868
Operating income 237,595 269,896 - (197,104)
NONOPERATING REVENUES (EXPENSES):
Investment revenue 1,261 38,405 - 244,256 Interest expense and fiscal charges (24,204) (106,285) - -
Total non-operating revenues (expenses) (22,943) (67,880) - 244,256
Income before contributions and transfers 214,652 202,016 - 47,152
Transfers in 72,437 78,593 - -
Transfers out - - (24,233,126) -
Change in retained earnings 287,089 280,609 (24,233,126) 47,152
Retained earnings at beginning of year 313,084 1,385,128 24,233,126 1,693,012
Retained earnings at end of year $ 600,173 ~ 1,665,737 ~ - ~ 1,740,164
124
Exhibit X;XXIII
Total
Technology Internal
Services Service Fund Funds
$ 5,800,312 $ 18,767,700
- 295,628
5,800,312 19,063,328
5,062,809 17,875,080
1,210,245 1,350,603
6,273,054 19,225,683
(472,742) (162,355)
77,529 361,451 ~s1,2s9~ ~211,74s~
(3,730) 149,703
(476,472) (12,652)
61,392 212,422
- (24,233,126)
(415,080) (24,033,356)
2,953,014 30,577,364
$ 2,537,934 $ 6,544,008
125
1
of
1GU
s
KPMG LLP
Suite 3100 717 North Harwood Street
Dallas, TX 75201-6585
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
Members of City Council
City of Denton, Texas:
We have audited the financial statements of the City of Denton, Texas (the City) as of and for the year
ended September 30, 2007, and have issued our report thereon dated February 18, 2008. We conducted our
audit in accordance with auditing standards generally accepted in the United States of America and the
standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States.
Internal Control over Financial Reporting
In planning and performing our audit, we considered the City's internal control over financial reporting as
a basis for designing our auditing procedures for the purpose of expressing an opinion on the financial
statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal
control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the
City's internal control over financial reporting.
A control deficiency exists when the design or operation of a control does not allow management or
employees, in the normal course of performing their assigned functions, to prevent or detect misstatements
on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies,
that adversely affects the entity's ability to initiate, authorize, record, process, or report financial data
reliably in accordance with generally accepted accounting principles such that there is more than a remote
likelihood that a misstatement of the entity's financial statements that is more than inconsequential will not
be prevented or detected by the entity's internal control.
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in
more than a remote likelihood that a material misstatement of the financial statements will not be prevented
or detected by the entity's internal control.
Our consideration of internal control over financial reporting was for the limited purpose described in the
first paragraph of this section and would not necessarily identify all deficiencies in internal control that
might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses,
as defined above.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free of material
misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts,
and grant agreements, noncompliance with which could have a direct and material effect on the
determination of financial statement amounts. However, providing an opinion on compliance With those provisions was not an objective of our audit, and accordingly, We do
not express such an opinion. The
results of our tests disclosed no instances of noncompliance or other matters that are required to be
reported under Government Auditing Standards.
We noted certain matters that we reported to management of the City in a separate letter dated February 18,
2008.
This report is intended solely for the information and use of the Mayor and City Council, management, and
federal and state awarding agencies and pass-through entities and is not intended to be and should not be
used by anyone other than these specified parties.
LLB
February 18, 2008
2
1
KPMG LLP
Suite 3100 717 North Harwood Street
Dallas, TX 75201-6585
Independent Auditors' Report on Compliance with Requirements Applicable to Each Major Program and on Internal Control over
Compliance in Accordance with OMB Circular A-133
Members of City Council
City of Denton, Texas:
Compliance
We have audited the compliance of the City of Denton, Texas (the City) with the types of compliance
requirements described in the U.S. Office of Management and Budget (OMB) Circular A-133 Compliance
Supplement that are applicable to each of its major federal programs for the year ended September 30,
2007. The City's major federal programs are identified in the summary of auditors' results section of the accompanying schedule of findings and questioned costs. Compliance
with the requirements of laws,
regulations, contracts, and grants applicable to each of its major federal programs is the responsibility of
the City's management. Our responsibility is to express an opinion on the City's compliance based on our
audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America; the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Proj~t Organizations. Those standards
and OMB Circular A-133
require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance
with the types of compliance requirements referred to above that could have a direct and material effect on
a major federal program occurred. An audit includes examining, on a test basis, evidence about the City's
compliance with those requirements and performing such other procedures as we considered necessary in
the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does
not provide a legal determination of the City's compliance with those requirements.
In our opinion, the City complied, in all material respects, with the requirements referred to above that are
applicable to each of its major federal programs for the year ended September 30, 2007.
Internal Control over Compliance
The management of the City is responsible for establishing and maintaining effective internal control over
compliance with the requirements of laws, regulations, contracts, and grants applicable to federal
programs. In planning and performing our audit, we considered the City's internal control over compliance
with requirements that could have a direct and material effect on a major federal program in order to
determine our auditing procedures for the purpose of expressing our opinion on compliance, but not for the
purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we
do not express an opinion on the effectiveness of the City's internal control over compliance.
A control deficiency in an entity's internal control over compliance exists when the design or operation of
a control does not allow management or employees, in the normal course of performing their assigned
functions, to prevent or detect noncompliance with a type of compliance requirement of a federal program
on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies,
that adversely affects the entity's ability to administer a federal program such that there is more than a
remote likelihood that noncompliance with a type of compliance requirement of a federal program that is
more than inconsequential will not be prevented or detected by the entity's internal control.
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in
more than a remote likelihood that material noncompliance with a type of compliance requirement of a
federal program will not be prevented or detected by the entity's internal control.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify
any deficiencies in internal control
over compliance that we consider to be material weaknesses, as defined above.
Schedule of Expenditures of Federal Awards
We have audited the financial statements of the governmental activities, the business-type activities, each
major fiend, and the aggregate remaining fund information of the City as of and for .the year ended
September 30, 2007, and have issued our report thereon dated January 18, 2008.Our audit was performed
for the purpose of forming opinions on the financial statements that collectively comprise the City's basic
financial statements. The accompanying schedule of expenditures of federal awards is presented for
purposes of additional analysis as required by OMB Circular A-133 and is not a required part of the basic
financial statements. Such information has been subjected to the auditing procedures applied in the audit of
the basic financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the
basic financial statements taken as a whole.
This report is intended solely for the information and use of the Mayor and City Council, management,
federal and state awarding agencies and pass-through entities and is not intended to be and should not be
used by anyone other than these specified parties.
Cs LLB'
February 18, 2008
4
CITY OF DENTON, TEXAS
Schedule of Expenditures of Federal Awards
Year ended September 30, 2007
Federal Passed-through Grant CFDA to
Federal grantor/pass-through grantorlprogram title I.D. number number Expenditures subrecipients
Federal awards: U.S. Department of Housing and Urban Development:
Community Development Block Grant B-O1-MC-48-0036 14.218 $ 7,539 - Community Development Block Grant B-02-MC-48-0036 14.218 14,611 -
Community Development Block Grant B-03-MC-48-0036 14.218 197,571 -
Community Development Block Grant B-04-MC-48-0036 14.218 98,800 - Community Development Block Grant B-OS-MC-48-0036 14.218 361,824 290
Community Development Block Grant B-06-MC-48-0036 14.218 436,429 123,561 Community Development Block Grant B-07-MC-48-0036 14.218 73,984 -
Home Investment Partnership M-99-MC-48-0223 14.239 20,021 - Home Investment Partnership M-00-MC-48-0223 14.239 643 -
Home Investment Partnership M-OI-MC-48-0223 14.239 53,695 -
Home Investment Partnership M-02-MC-48-0223 14.239 5,801 - Home Investment Partnership M-03-MC-48-0223 14.239 76,179 -
Home Investment Partnership M-04-MC-48-0223 14.239 27,344 5,004 Home Investment Partnership M-OS-MC-48-0223 14.239 64,302 18,496
Home Investment Partnership M-06-MC-48-0223 14.239 42,707 42,000
Home Investment Partnership M-07-MC-48-0223 14.239 19,110 - Supportive Housing Program TX01B310001 14.235 62,187 -
Neighborhood Initiative B-04-NI-TX-0038 14.251 155,788 - Economic Development Initiative B-04-SP-TX-0788 14.251 4,635 -
Total Direct Funding U.S. Department of Housing and
Urban Development 1,723,170 189,351
Passed-through Texas Department of Housing and Community Affairs: Emergency Shelter Grants 426117 14.231 142,157 134,331
Total U.S. Department of Housing and Urban Development 1,865,327 323,682
Federal Environmental Protection Agency: Water Quality Grant CP - 83207101-0 66.436 60,073 -
HickoryCreek Basin CWA Section 319 Grant CP - 99614641-0 66.460 229,272 -
Total Federal Environmental Protective Agency 289,345 -
U.S. Department of Homeland Security: Passed through State Department of Public Safety:
Governor's Division of Emergency Management:
Emergency Management Performance Grant 06TX-EMPG-034 97.042 975 - EmergencyManagement Performance Grant 07TX-EMPG-0122 97.042 72,574 -
2005 State Homeland Security Program (SHSP) 2005-GE-TS-4025 97.067 49,586 - 2005 Urban Area Security Initiative (UASI) 2005-GE-TS-4025 97.067 164,919
-
2005 Citizen Corps Grant (CCP) 2005-GE-TS-4025 97.067 21,784 -
Total U.S. Department of Homeland Security 309,838 -
U.S. Department of Justice: Local Law Enforcement Block Grant 2004-LB-BX-1381 16.592 11,136 -
COPS in Schools Grant 2002-SH-WX-0164 16.710 6,290 - BryneJustice Assistance Grant 2006-DJ-BX-1089 16.580 11,122 -
COPS 2006 Technology Grant 2006-CK-WK-0140 16.710 30,000 -
Total U.S. Department of Justice 58,548 -
U.S. Department of Agriculture: Passed through Texas Department of Health and Human Services:
Summer Food Services Grant 061-1002 10.559 90,457 -
Total U.S. Department of Agriculture 90,457 -
Passed-through State Department of Transportation: Comprehensive STEP 587XXF6019 20.600 57,060 -
Total U.S. Department of Transportation 57,060 -
Total expenditures of federal awards $ 2,670,575 323,682
See accompany notes to schedule of expenditures of federal and state awards.
5
CITY OF DENTON, TEXAS
Schedule of Expenditures of State Awards
Year ended September 30, 2007
Passed-through
Grant to Federal grantorlpass-through grantor/program title I.D. number Expenditures subrecipients
State awards:
Texas State Library and Archives Commission:
Loan Star Library Grant 442-07133 $ 19,695 -
Total library 19,695 -
North Central Texas Council of Government (NCTCOG): Home Chemical Collection Center 06-04-G17 17,582 -
Total NCTCOG ~ 17,582 -
Texas Department of Transportation:
Airport Maintenance Grant M718DNTON 45,812 -
Total Texas Department of Transportation 45,812 -
Texas Commission of Environmental Quality:
Hickory Creek Basin CWA Section 319 Grant 582-5-70824 40,000
Total Texas Commission of Environmental Quality 40,000 -
Totalexpenditures of state awards $ 123,089 -
See accompany notes to schedule of expenditures of federal and state awards.
6
CITY OF DENTON, TEXAS
Notes to Schedule of Expenditures of Federal and State Awards
Year ended September 30, 2007
(1} General
The accompanying schedules of expenditures of federal and state awards presents the activity of all
applicable federal and state awards of the City of Denton, Texas (the City). The City's reporting entity is
defined in note 1 to the City's basic financial statements. Federal and state awards received directly from
federal and state agencies as well as federal and state awards passed through other government agencies
are included on the respective schedule.
(2) Basis of Accounting
The accompanying schedules of expenditures of federal and state awards is presented using the modified
accrual basis of accounting, which is described in note 1 to the City's basic financial statements.
(3) Schedule of Findings and Questioned Costs
The schedule of findings and questioned costs, including the summary of auditors' results for federal awards is included beginning on page 8.
(4} Relationship to Federal Financial Reports
Grant expenditures reports as of September 30, 2007, which have been submitted to grantor agencies will,
in some cases, differ slightly from amounts disclosed herein. The reports prepared for grantor agencies are
typically prepared at a later date and often reflect refined estimates of the year-end accruals. The reports
will agree at termination of the grant as the discrepancies noted are timing differences.
7
CITY OF DENTON, TEXAS
Schedule of Findings and Questioned Costs
Year ended September 30, 2007
(1) Summary of Auditors' Results
.Financial Statements
Type of Auditor's report issued: Unqualified
Internal control over financial reporting:
• Material weaknesses identified: No
• Reportable conditions identified that are not considered to be material weaknesses: None reported
Noncompliance material to financial statements noted: No
Federal Awards
Internal control over major programs:
• Material weaknesses identified: No
• Reportable conditions identified that are not considered to be material weaknesses: No
Type of auditor's report issued on compliance for major programs: Unqualified
Any audit findings disclosed that are required to be reported in accordance with Section 51o(a} of OMB
Circular A133: No
Identification of major programs:
CFDA
Program number
CDBG 14.218
Homeland Security Cluster:
2005 State Homeland Security Grant Program 97.067
2005 Urban Area Security Initiative 97.067
2005 Citizens Corps Grant 97.067
Dollar threshold used to distinguish between Type A and Type B programs: $300,000
Auditee qualified as a low-risk auditee: No
(2) Findings Relating to the Financial Statements Reported in Accordance with Government Auditing
Standards:
None
(3) Findings and Questioned Costs Relating to Federal Awards:
None
8
KPMG LLP
Suite 3100 717 North Harwood Street
Dallas, TX 75201-6585
February 18, 2008
The Audit Committee City of Denton, Texas
Ladies and Gentlemen:
We have audited the financial statements of City of Denton (the City), for the year ended September 30,
2007, and have issued our report thereon dated February 18, 2008. In planning and performing our audit of
the financial statements of the City, in accordance with auditing standards generally accepted in the United
States of America, we considered the City's internal control over financial reporting (internal control) as a basis for designing our auditing procedures for the purpose of expressing
our opinion on the financial
statements but not for the purpose of expressing an opinion on the effectiveness of the City's internal
control. Accordingly, we do not express an opinion on the effectiveness of the City's internal control.
During our audit, we noted certain matters involving internal control and other operational matters that are
presented for your consideration. These comments and recommendations, all of which have been discussed
with the appropriate members of management, are intended to improve internal control or result in other
operating efficiencies and are summarized as follows:
Financial Reporting
Observation
The preparation of the Comprehensive Annual Financial Report (CAFR) is manual intensive process. The
City had delays in the process of preparing the CAFR and supporting schedules, which created delays in
significant information needed to complete the audit for fiscal year 2007.
RecommendatZ'ons
• Management should continue to review and enhance the financial reporting process to ensure that all
internal and external financial reporting deadlines are met and that all financial data is complete and
accurate.
• Management should consider additional resources in the financial reporting process.
Views of Responsible Officials and Planned Corrective Actions
Management agrees with the recommendation. Staff will strive to provide financial reporting in a more
timely fashion while preserving the accuracy of the information presented. In addition, management will
carefully consider the level of resources that are allocated to the financial reporting function.
The Audit Committee
City of Denton, Texas
February 18; 2008
Page 2
Access Controls
Observation
The control testing in the IT environment identified some issues that management should apply focus to
improve the controls for access controls.
• Terminated employees are active on the Novell System. It was noted that 16 terminated users out of
1134 users from 2007 had active user IDs in Novell. The Novell ID provides access to the network.
• User access forms were not properly retained or did not have proper approval. Access forms for
4 out of 30 new hires were not retained and 1 out of 30 .new hire forms did not have approval.
Approval is required to be maintained prior to access to the IT systems. It was noted that the users
were authorized; however, the documentation was not readily available.
• No formal requirements in place for password syntax on the in-scope applications, DB and servers.
Views of Responsible Officials and Planned Corrective Actions
Management agrees with this recommendation. Technology Services is working with Human Resources to
streamline the terminated employees' process so system access is disabled in a more timely fashion.
Quarterly system access audits will be performed by Technology Services on the in-scope applications to
ensure proper documentation is correct and readily available. A formal password policy is in draft format
and will be discussed when the permanent Technology Services Director is hired.
Program Change Controls
Observation
It was noted that the City has implemented a process for program change management policies and
procedures for the JDE System during fiscal year 2007. The testing of the control indicated that the
documentation did not allow the linkage between the approval for the change to the actual change
documented, tested and implemented (cannot link the program change document to the approval
document). It appears that the City follows a process however, it is not well documented.
Turnover in employees, emergency fixes, or changes in key applications may require the City to decide
how a change should be addressed. Without reference, a change may not receive the proper approvals,
testing, or documentation as expected by management. An improperly handled change could adversely
affect the production operating environment and financial results.
Views of Responsible Of~CCials and Planned Corrective Actions
Management agrees with this recommendation. Technology Services will augment existing procedures so
system changes and approvals are easily linked.
k ~ k ~ ~ k k
Our audit procedures are designed primarily to enable us to form an opinion on the financial statements
and, therefore, may not bring to light all weaknesses in policies or procedures that may exist. We aim,
however, to use our knowledge of the City's organization gained during our work to make comments and
suggestions that we hope will be useful to you.
U~R~
The Audit Committee
City of Denton, Texas
February 18, 2008
Page 3
We would be pleased to discuss these comments and recommendations with you at any time.
This communication is intended solely for the information and use of the Audit Comrriittee, Mayor and
City's management, and federal and state awarding agencies and is not intended to be and should not be
used by anyone other than these specified parties.
Very truly yours,
I~N~(~ LLB'
KPMG LLP
Suite 3100
717 North Harwood Street Dallas, TX 75201-6585
February 18, 2008
City Council and Audit Committee
City of Denton, Texas
Denton, Texas
Ladies and Gentlemen:
We have audited the financial statements of the governmental activities, the business-type activities, each
major fund, and the aggregate remaining fiend information of the City of Denton, Texas, (the City) as of
and for the year ended September 30, 2007, which collectively comprise the City's bask financial
statements and have issued our report thereon under date of February 18, 2008. Under our professional
standards, we are providing you with the attached information related to the conduct of our audit.
Our Responsibility Under Professional Standards
We are responsible for forming and expressing an opinion about whether the financial statements, that
have been prepared by management with the oversight of City Council and the Audit Committee, are
presented fairly, in all material respects, inconformity with U.S. generally accepted accounting principles.
We have a responsibility to perform our audit of the financial statements in accordance with professional
standards. In carrying out this responsibility, we planned and performed the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement, whether caused by
error or fraud. Because of the nature of audit evidence and the characteristics of fraud, we are to obtain
reasonable, not absolute, assurance that material misstatements are detected. We have no responsibility to~
plan and perform the audit to obtain reasonable assurance that misstatements, whether caused by error or fraud, that are not material to the financial statements are detected. Our
audit does not relieve management
or the City Council and Audit Committee of their responsibilities.
In addition, in planning and performing our audit of the financial statements, we considered internal
control over financial reporting (internal control) as a basis for designing our audit procedures for the
purpose of expressing our opinion on the financial statements but not for the purpose of expressing an
opinion on the effectiveness of the City's internal control. Accordingly, we do not express an opinion on
the effectiveness of the City's internal control.
We also have a responsibility to communicate significant matters related to the financial statement audit
that are, in our professional judgment, relevant to the responsibilities of City Council and the Audit
Committee in overseeing the financial reporting process. We are not required to design procedures for the
purpose of identifying other matters to communicate to you.
City Council and Audit Committee
City of Denton, Texas
February 18, 2008
Page 2
Other Information in Documents Containing Audited Financial Statements
Our responsibility for other information in documents containing the City's basic financial statements and
our auditors' report thereon does not extend beyond the financial information identified in our auditors'
report, and we have no obligation to perform any procedures to corroborate other information contained in
these documents. we have, however, read the other information included in the comprehensive annual
financial report, and no matters came to our attention that cause us to believe that such information, or its
manner of presentation is materially inconsistent with the information, or manner of its presentation,
appearing in the basic financial statements.
Accounting Policies and Alternative Treatments
Significant Accounting Policies
The significant accounting policies used by the City are described in Note 1 to the basic financial
statements.
Unusual Transactions
On October 1, 2006, the motor pool fund was eliminated and all assets and liabilities were transferred to
the funds requiring the usage of the asset.
Management Judgments and Accounting Estimates
The re aration of the basic financial statements requires management of the City to make a number of PP
estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities at September 30, 2007 of the basic financial statements and the reported
amounts of revenues and. expenses during the period.
Management has made the following significant judgments and estimates that could affect fair
presentation in the basic financial statements:
• The allowance for uncollectible receivables for property taxes and utility services
• The disclosure of the fair value of financial instruments
• The useful lives of depreciable capital assets
• Allocation of expenses by function within the government-wide financial statements
we evaluated the key factors and assumptions used to develop these estimates when determining that these
estimates are reasonable in relation to the basic financial statements taken as a whole.
Uncorrected and Corrected Misstatements
In connection with our audit of the City's basic financial statements, we did not identify any material
financial statement misstatements that have not been recorded in your books and records as of and far the
year ended September 30, 2007 and have communicated that finding to management.
City Council and Audit Committee
City of Denton, Texas
February 18, 2008
Page 3
In addition, during the course of our audit we identified and discussed with management financial
statement misstatements that were corrected by the City. Attached is a copy of the adjustments and other
corrected misstatements that have been discussed with management and corrected by the City.
Disagreements with Management
There were no disagreements with management on financial accounting, and reporting matters that, if not
satisfactorily resolved, would have caused a modification of our auditors' report on the City's basic
financial statements.
Management's. Consultation with Other Accountants
To the best of our knowledge, management has not consulted with or obtained opinions, except as
identified in our report, written or oral, from other independent accountants during the year ended September 30, 2007.
Major Issues Discussed with the Audit Committee and Management Prior to Retention
We generally discuss a variety of matters, including the application of accounting principles and auditing
standards, with management each year prior to our retention by you as the City's auditors. However, these
discussions occurred in the normal course of our professional relationship and our responses were not a
condition to our retention.
Significant Difficulties Encountered in Performing the Audit
We encountered no difficulties in dealing with management in performing our audit.
Material Written Communications
Per request, we will furnish copies of the following material written communications between
management and us:
1) Engagement letter
2) Management representation letter
Independence
Our professional standards and other regulatory requirements specify that we communicate to you in writing, at least annually, all independence-related relationships
between our firm and the City and provide
confirmation that we are independent accountants with respect to the City.
i
City Council and Audit Committee
City of Denton, Texas
February 18, 2008
Page 4
We are not aware of any independence-related relationships between our firm and the City other than the
professional services that have been provided to the City, which are summarized below.
We have summarized the fees paid or payable to the firm relating to the audit of the 2007 basic financial
statements and single audit report:
Audit:
Comprehensive annual financial report OMB A-133 single audit report $ 149,420
Confirmation of Audit Independence
We hereby confirm that as of February 18, 2008, we are independent accountants with respect to the City under all relevant professional and regulatory standards.
:r x :r• ,r
This report to the City Council is intended solely for the information and use of the City Council, the City
Mayor and management, and is not intended to be and should not be used by anyone other than these
specified parties.
Very truly yours,
LLB'
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'■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 ■■I ■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■I ■■■■■■_■_■■■■■_■~■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■I[~■.Jll~~i 1~~1■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■I '■■■■1~~■rl■■l 1■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 ■■l '■■■■~l~■■J■■■~~~■■■■■■■■■■■■■
■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■IIF~L111f i■i~1■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■l ■■■■■l J■■l~■i'J■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■111~~III■1~~1■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■l ~■J■■~ 1■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 '■■■■■!'■rl■■~~~i"J■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■
■■■■■■1
~ ~ '■1■III~~NII■~\~~■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ~■■r..~■ 1■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■Ilr■'~11■~■:J■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■■■■id■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
■■■■■r..~■■■■■~■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■II1111 JII■1■i~il■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
■■■■■■~~■■r~r..~■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■I~7f 1111 ~~'J■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■■■1 I■■■■■~■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■
■■■1
■■I \■I 1■■■■■■7■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11`.~11■~■■J■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
■■I '■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill '■1■11~~■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
■■I '■■■■■FI~► ---1■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 ■■l ;~~L~ii■■~■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■1l~~~111■i~:J■1■11■1■11■1■11■1■11■
1■11■1■11■1■11■1■111
■■l ■■■■■~I■M■■■V7■~■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■ICC::JII■1:: I■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
■■l ■■■■~7~~■■■■r~■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 ■■■■r ~■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■Il ■11111■I~~r'~~11■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 --~~■■■■J■7V■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11~1■11l~!:J■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1
■111
'■■■■■■A■■■■ ~1 ■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■Ill~l II~11■1■1~■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■■■■■~~■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ~ ■1■11~:JII■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■■■'~'■■~1■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 ■■I '■■■■L~■■J■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■
■■■■■■■■■■■■1
Ill '■1■11'~~~11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■I '■■■■■r■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■I ■■■■■I,~►1■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 ■■l ~ I■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■
■■■■■■■■■■■■■■■■1
Ill ■1■11■~~11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■l ~~.J■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■Ilill■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■l ■■■■■■■!I■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
-'J■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill '■1■I~I III lll■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
■■■■■\~J■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11~'1~11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 II It I■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■11\JII■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■■■!n■■--I■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
■■■■■W■M■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11~.JII■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
'■■■■■!'■rl■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■III~~NII■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 '■■■■■I,~ Ill■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■
■■■1
■■I 11 II I■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11\~~111■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
,r.1■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ~ ■1■Ill'~~11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
■■I '■■■■■~'1n■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 ■■I ■■■■■~;i ii I■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■Ill_ JII■1■11■1■11■1■11■1■11■
1■11■1■11■1■11■1■11■1■111
■■l ■■■■■l ~■!'I■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11~:JII■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
■■■■r^~■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 ■■■■1 ■i 1■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■11.-:III■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ....~..r■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1
■111
.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 '.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 '.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 .........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 ■■I .........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■
■■1
Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■I '.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ..I '.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
■■l .........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■l .........................■■■■■■■■■■■■■■
■■■■■■■■■■■■■■■■1
Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■l .........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 .........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
'.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 ■■I '.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11
■1■11■1■111
..I '.........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111
■■I .........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 .........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
Ill ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■111 ■■l .........................■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1 11■►. ■1■11■1■11■1■11■1■11■1■11■1■11■1■11■1■11■
1■11■1■11■1■111
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■■1 '\■■■■■1
■■1 '~■■1
■■1 ■■1
■■I I■1
■■I !1■1
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■■1 '1■1
■■1 '1■1
■■1 'l■1
■■1 '1■1
■■1 'l■1
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■■I 1■1
■■1 '1■1
■■1 '1■1
■■1 '1■1 ■■1 'l■1
■■I !1■1
■■I 'l■1
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■■I 'l■1 ■■I !1■1
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■■I l■1
■■1 '1■1
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■1
111 ~''"~II■~Y~II ■■1 `"1■■■■■1 111 \I■111
■■I `~■■1
■■I ■■1
111 'lll ■■I I■1
■■I 1■1
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1■1
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■■i i■i 1■1
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■■i i■i
■■i i■i
■■i i■i
i■i
i■i Ilia
11■11■1~.,.
■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
111 '"~11■IV~II ■■f `\■■■■■1 11~' \I■111
■■f '~■■1
■■I' ■■1
111' 'lll ■■f 1■1
■■f '1■1
■■f '1■1
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■■I' !1■1 ■■I' !1■1
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111' '11~
■■f '1■1
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■■i i 'i■
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111' '111 ■■f !1■1
■■i' !i■
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111 '111
111 '111 '1■1
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111' '111
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'1■1
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■■i i■i ..f !1■1
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■■i i■i
■■i i■i
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i■i 11\
11■11■1\._
■■~■■.■■■■■■.■.■■.■.■■.■■■■.■■.■■■.■.■■.■.■■.■.■■■■■.■■■.■.■■.■.■■.■■~■■■■■■~r_~■~
111 ~'"~II■Ia~ll 111 *\I■111
~■■■i
■■i
111 '111 ■■i ■i
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■■i 'i■
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111 111
■■i 'i■i
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~■i 111 '111
■■i 'i■i 111 'lll
~■i
■■i ~ ~ i■
■■i i■i ■■i i■i
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■■i i■i
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■■i i■i
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11■11■1~.,.
■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■1
11~' '""~11■i~~ll ■■f `\■■■■■1 11~' I■111
■■I' ■■1
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111 '111
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■■f '1■1 'i■
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■■i' 'i■i
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CITY OF DENTON CITY COUNCIL MINUTES
March 3, 2008
After determining that a quorum was present, the City Council convened in a Special Called
Work Session on Monday, March 3, 2008 at 11:30 a.m. in the Council Work Session Room.
PRESENT: Mayor McNeill; Deputy Mayor Pro Tem Mulroy; Council Members Heggins,
Montgomery, Thomson, and Watts.
ABSENT: Mayor Pro Tem Kamp
1. Council held a discussion with the Library staff regarding but not limited to department
functions, programs, and major accomplishments.
Eva Poole, Director of Libraries, presented a brief history of the library noting the three directors
that the library system has had and various accomplishments at the libraries. The mission
statement of the library was to enrich and advance the community; and provide quality materials
and services of informational, educational, leisure and cultural value. The values statements
included value the community, intellectual freedom through open access to information,
dlverSlty, service with integrity and enjoyment of reading. The management team of the library
system was introduced: Emily Fowler Branch Manager, Martha Edmundson; South Branch Manager, Linda Touraine; North Branch Manager, Stacy Sizemore; and Technical
Services
Manager, Corinne Hill.
Poole stated that the library system had 49.5 full-time employees on staff with 3,393 volunteer
hours worked which was a great asset to the library. She presented a statistical summary from
2002-2006 comparing population served, expenditures, per capita expenditure, number of items
in the materials collection, per capital circulation of materials, and circulation per staff member.
Other statistical information presented included monthly web usage reports, items per capita
compared with regional peer group libraries, materials expenditures per capita compared with
regional peer group libraries, total expenditures per capita compared with regional peer group
libraries, circulation per capita compared with peer group libraries, and building square feet per
capita compared with peer group libraries. Master services plan key assumptions included
service delivery and resource use, meeting community needs, performing a cost study analysis
and developing activities. Service priorities for 2008-2010 included reading, viewing and
listening for pleasure, lifelong learning, emergent literacy, providing public and virtual spaces,
genealogy and local history and information literacy. Poole also reviewed the services provided
by the Library Advisory Board and the Friends of the Denton Public Libraries.
Martha Edmundson presented features and benefits of the Emily Fowler Library. This library
included special collections which featured genealogy, a Texas collection and Denton, Texas
collection. Programming done at this branch included programs inside the library, outside the
library, books-to-share and Denton Reads.
Linda Tourraine presented features and benefits of the South Branch Library some of which
included wireless Internet access, programs for all ages, 8 public access Internet computers and 4
online public access catalogs. She also reviewed the planned expansion of the branch with
construction to start April 2008 and final completion in April 2009.
Stacy Sizemore presented the features and benefits of the North Branch Library which features a
computer training room with 20 workstations, regularly scheduled free computer training for the
public, and youth services programs.
City of Denton City Council Minutes
March 3, 2008
Page 2
Corrine Hill, Manager of Information Services, reviewed the Technical Services Unit services
which included collection development for acquisitions and cataloging, materials processing,
interlibrary loans and an integrated library system. She reviewed the procedures for items on
hold, transfer materials, and new materials with holds. Goals of her department were quality
materials, timely delivery and prudent budgeting.
Council discussion included:
• Amount of electronic materials in the system in conjunction with regular books.
• Per capita of materials per citizens.
• Reaction of the fee charged for non citizens -Poole indicated that the issue had finally
calmed down. Approximately 18,000 outside patrons were served by the library system and
of that,1,475 had paid anon-resident fee.
Poole presented a summary of building and service capacity, benchmarks for future planning
which included a goal of 3 items per capita, projected population and estimated library
capacities. By 2010 the library collection would begin to exceed the building size. Anew
building would be needed in 2012 and 2016 based on population projections and 2 items per
capita. With three items per capita the buildings would be needed sooner. Planning for future
growth would involve the purchase of land in southwest Denton for a central proximity to three
new master planned communities; timing and availability of utilities would have to be
considered as well as access to FM 2449 and I35. She would like to plan for the building of the
southwest library in the 2009 CIP cycle and purchase land in northwest Denton in 2014.
Council discussion included:
• Coordinate the land purchases with the Parks Department -Poole indicated that she would
cooperate with the Parks Department as she only needed approximately 5 acres for a library
site.
• Would there be an advantage to enlarging the North Branch Library -Poole stated that it
might be an option but had not been explored at this time.
• Was the library able to get back any of the positions lost with the reduction in force -Poole
stated that three employees were lost at that time and the forecast was to add one this year.
• What was the WiFi usage at the library -Poole indicated there were about 54 users per
month with daily complaints why it was not available at the other branches.
• What was the cost to put WiFi in the libraries -Poole indicated it was approximately
$14,000 a year for maintenance and $37,000 for installation.
• The park land purchase cycle was earlier than 2009. Look at purchasing park land with a
library site included and then reimburse the funds for the library at the next CIP.
With no further business, the meeting was adjourned at 12:40 p.m.
PERRY R. MCNEILL JENNIFER WALTERS
MAYOR CITY SECRETARY
CITY OF DENTON, TEXAS CITY OF DENTON, TEXAS
CITY OF DENTON CITY COUNCIL MINUTES
March 4, 2008
After determining that a quorum was present, the City Council of the City of Denton, Texas
convened in a Work Session on Tuesday, March 4, 2008 at 4:30 p.m. in the Council Work
Session Room at City Hall.
PRESENT: Mayor McNeill; Mayor Pro Tem Kamp; Deputy Mayor Pro Tem Mulroy; Council
Members Heggins, Montgomery, Thomson, and Watts.
ABSENT : None
Item #2 was considered.
2. Council received a report, held a discussion, and gave staff direction regarding aTrap-
Neuter-Release Ordinance for the management of the feral cat population in the City of Denton.
Scott Fletcher, Denton Police Department, stated that 700 feral cats were handled in animal
services facility this past year. There were three approaches to consider with the feral cat
problem. One was to try and trap the cats, hold them for the required time frame and then
euthanize them. With only a few exceptions no one would be able to adopt those cats as they
were too wild. This scenario was not an effective approach to the problem. Another approach
was not to do anything unless citizens checked out traps in an effort to control the population. A
third approach was to trap the cats, neuter them and then release them. Citizen volunteers would
be needed to determine the feral cat colonies and assist with trapping the cats. The cats would be neutered, vaccinated and repopulated back in the colony. Benefits for this
type of program were
that it would involve the community and reduce the population of the feral colony in a humane
manner. Other cities with such a program noted a decrease in the population with this method.
A proposed ordinance set specific operations for the volunteers, added an educational component
for the volunteers, included an oversight committee which would include a veterinarian to help
the animal services supervisor with educational materials and any potential problems in the
colonies. The most important aspect of the proposed ordinance was that it did not change any of
the responsibilities ofpet owners of domestic cats.
Council discussion included:
• Were microchips inserted in both males and females at the time of sterilization -Fletcher
rep ie correct.
• This was a very humane way to solve the feral cat problem.
• Was the feral cat problem concentrated in particular neighborhoods -Fletcher stated that this
was acity-wide problem.
Consensus of Council was to proceed with the consideration of the ordinance.
Council returned to the regular agenda order.
1. Staff responded to requests for clarification of agenda items listed on the agenda for
March 4, 2008.
Mayor McNeill stated that Item 3E would be pulled for separate consideration.
City of Denton City Council Minutes
March 4, 2008
Page 2
City Attorney Snyder stated that Items 3D and 3T had amended contracts which were provided
to Council. The amendment added monetary caps for the contracts.
Mayor McNeill asked staff to review the reporting process for Item 3E.
Bryan Langley, Director of Finance, stated that the construction project involved renovations to
City Hall East for the Police Department. The project was approved in the last CIP. The
purpose of agenda item was to approve a reimbursement resolution with funds being reimbursed
once the bond sale was completed. Facilities Management would be the general contractor.
They would provide Council with a monthly status report indicating where they were in the
project and where they were in the funding area. The total amount for the project was estimated
three years ago at $500,000; however, a more realistic figure was now needed for the needs of
the Police Department. Additional dollars from prior projects that were under budget would be
added to the construction project funding.
Mayor McNeill stated that only the reimbursement resolution would be considered at this
meeting. The other procedures would be formalized at a future meeting.
City Manager Campbell stated that staff felt it would be better not to confuse the construction
method with the funding mechanism. A resolution would be presented at the next meeting that
stated the concept of the project. The Council minutes would recognize the sentiment of the
Council but was not put into this ordinance.
Consensus of the Council was to consider the item separately so there would be a record on how
to proceed.
City Attorney Snyder asked for direction on several of the Closed Session items. If Council had
no questions on the Aldi item and Atmos Energy item, they would not be considered during the
Closed Session.
Consensus of the Council was that there was no need to discuss those two items in Closed
Session.
Following the completion of the Work Session, the City Council convened in a Closed Meeting
at 5:02 p.m. to consider the specific items listed below under the Closed Meeting section of this
agenda.
1. Closed Meeting:
A. Consultation with Attorney Under Texas Government Code Section 551.071.
1. Consulted with the City's attorneys to discuss legal issues associated with
city's biodiesel production.
2. Considered and discussed litigation styled Tower v. City of Denton, Civil
Action No. 4:05cv302, currently pending in the U.S. District Court,
Eastern District, Sherman Division.
City of Denton City Council Minutes
March 4, 2008
Page 3
3. Discussed and considered strategy, status, and possible settlement of
litigation with the City's attorneys regarding Atmos Energy, GUD Docket
No. 9762. A public discussion of these legal matters would conflict with
the duty of the City's attorneys to the City Council under the Texas
Disciplinary Rules of Professional Conduct of the State Bar of Texas.
B. Deliberations regarding consultation with the City Attorney -Under Texas
Government Code Section 551.071 and Section 551.087 -Deliberations
regarding Economic Development Negotiations.
1. Received a report and held a discussion regarding legal issues on matters
in which the duty of the attorney to the governmental body under the
Texas Disciplinary Rules of Professional Conduct of the State Bar of
Texas clearly conflicts with the provisions of the Texas Open Meetings
Act, Chapter 551 of the Texas Government Code. Also hold a discussion
regarding extending the term of the Agreement with Aldi (Texas) L.L.C.
from five years to seven years, or to reimburse Aldi for the design and
construction costs of Westcourt Road, whichever is less. This discussion
shall include commercial and financial information the City Council has
received from Aldi (Texas) L.L.C., which the City Council seeks to have
locate, stay, or expand in or near the territory of the city, and with which
the City Council is conducting economic development negotiations;
including the offer of financial or other incentives.
C. Consultation with Attorney -Under Texas Government Code Section 551.071.
1. Consultation with the City's attorneys regarding legal issues, including
defense of pending and potential litigation filed by JNC Denton Partners,
LLC, associated with annexation of real property in the City's northern
ETJ, under annexation case no. A05-0002, along with other legal issues
related to the annexation, including zoning, land use and subdivision
controls, plat applications, annexation plans, development agreements,
annexation agreements, service plans, utility service, and legal issues
implicated by alternative proposals advanced by individuals owning
property within the proposed annexation area. A public discussion of
these legal matters would conflict with the duty of the City's attorneys to
the City Council under the Texas Disciplinary Rules of Professional
Conduct of the State Bar of Texas or would jeopardize the City's legal
position in any administrative proceedings or potential litigation.
2. Considered and discussed litigation styled City of Denton v. Reichmann
Petroleum Corp., Cause No. 2006-40169-362, currently pending in the
362nd District Court of Denton County, Texas and related bankruptcy case.
Items C.l . and C.2. were not considered during the Closed Session.
Regular Meeting of the City of Denton City Council on Tuesday, March 4, 2008 at 6:30 p.m. in
the Council Chambers at City Hall.
City of Denton City Council Minutes
March 4, 2008
Page 4
PRESENT: Mayor McNeill; Mayor Pro Tem Kamp; Deputy Mayor Pro Tem Mulroy; Council
Members Montgomery, Thomson, and Watts.
ABSENT: Council Member Heggins
1. PLEDGE OF ALLEGIANCE
The Council and members of the audience recited the Pledge of Allegiance to the U. S. and
Texas flags.
2. PROCLAMATIONS/PRESENTATIONS
A. Proclamations/Awards
Mayor McNeill presented the following proclamations:
Social Work Month
Red Cross Month
Surveyor's Week
3. CONSENT AGENDA
Mayor McNeill reviewed the items for consideration on the Consent Agenda.
Deputy Mayor Pro Tem Mulroy asked that Item E be pulled for separate consideration.
Robert Donnelly presented a speaker card for Item 3A. He asked that Council pull 3A and
reconsider as it was not a good plan for the City.
Kamp motioned, Mulroy seconded to approve with the Consent Agenda and accompanying
ordinances and resolutions with the exception of Item E. On roll vote, Kamp "aye",
Montgomery "aye", Mulroy "aye", Thomson "aye", Watts "aye", and Mayor McNeill "aye".
Motion carried unanimously.
Item E was considered.
Bryan Langley, Director of Finance, stated that the Police Department had requested a
renovation of their current facilities. The project had been approved in the 2007-08 CIP budget.
$500,000 was in Certificates of Obligation scheduled for a future bond sale. An additional
$200,000 would be added from savings from other completed projects. The reimbursement
ordinance was for the Certificates of Obligation to begin the process and reimburse after the
bond sale. Facilities Management would be the contract manager for the project. Staff would
supply the Council a monthly update on the basis of the construction process and the funding. A
formal resolution on this procedure would be on the Council's next agenda.
City of Denton City Council Minutes
March 4, 2008
Page 5
Thomson motioned, Mulroy seconded to approve the Item E. On roll vote, Kamp "aye",
Montgomery "aye", Mulroy "aye", Thomson "aye", Watts "aye", and Mayor McNeill "aye".
Motion carried unanimously.
A. R2008-006 - A resolution of the City Council of the City of Denton, Texas,
endorsing the Denton County Transportation Authority application to the
Regional Transportation Council for a Regional Toll Revenue Funding Initiative
(RTRFI) Grant to facilitate implementation of regional rail service from Denton,
Texas to Carrollton, Texas with a connection to the Dallas central business
district, and providing an effective date. The Mobility Committee recommended
approval (2-0).
B. 2008-050 - An ordinance of the City of Denton, Texas, granting the Denton
Festival Foundation, pursuant to Section 20-1(d)(3)b.6 of the Code of Ordinances
of the City of Denton, Texas, an exception to the limitations imposed by that
section with respect to hours of operation of an amplified loudspeaker system; and
setting an effective date.
C. R2008-007 - A resolution by the City Council of the City of Denton relating to
the issuance of bonds by North Texas Higher Education Authority, Inc.,
approving the issuance of such bonds and the use of the proceeds of such bonds;
and making certain findings in connection therewith.
D. 2008-051 - An ordinance of the City Council of the City of Denton, Texas
authorizing the City Manager to execute a second amended contract for
professional legal services with Wolfe, Tidwell & McCoy for professional legal
services relating to litigation styled Tower v. City of Denton, Civil Action No.
4:OScv302 pending in the U.S. District Court, Eastern District, Sherman Division;
authorizing the expenditure of funds therefor; and providing an effective date.
E. 2008-052 - An ordinance of the City of Denton, Texas to declare the intent to
reimburse expenditures from the unreserved fund balance of the General Fund
with Certificates of Obligation with an aggregate maximum principal amount
equal to $500,000 so that the Facilities Department can begin the renovation of
space at the City of Denton Police Department.
F. 2008-053 - An ordinance accepting competitive bids and awarding atwo-year
contract for the mowing of two cemeteries for the city of Denton Parks
Department; providing for the expenditure of funds therefor; and providing an
effective date (Bid 3975-Two-Year Contract for Mowing of Cemeteries awarded
to the lowest responsible bidder in the annual estimated amount of $66,020 for a
two year award amount of $132,040).
G. 2008-054 - An ordinance of the City of Denton authorizing the City Manager or
his designee to execute a purchase order through the Houston-Galveston Area
Council (H-GAC), Buy Board Cooperative Purchasing Network, and the State of
Texas Building and Procurement Commission Department of Information
City of Denton City Council Minutes
March 4, 2008
Page 6
Resources (DIR) under #DIR-SDD-531; for the acquisition of five radars, ten
mobile data computers, and twenty one light bars for the City of Denton Police,
Fire and Public Works Departments by way of an Interlocal Agreement with the
City of Denton; and providing an effective date (File 3990-Interlocal Agreement
for the purchase of Miscellaneous Equipment for Police, Fire, and Public Works
Vehicles awarded to multiple vendors as listed on Exhibit A in the amount of
$111,406.56).
H. 2008-055 - An ordinance of the City of Denton, Texas providing for, authorizing,
and approving the expenditure of funds for the purchase of ten Mobil Vision In-
Car Digital Recording Systems for the City of Denton Police Department, which
are available from only one source in accordance with the pertinent provisions of
Chapter 252 of the Texas Local Government Code exempting such purchases
from the requirements of competitive bidding; and providing an effective date
(File 3989-to L-3 Communications Mobile Vision, Inc. in the amount of
$54,700).
I. 2008-056 - An ordinance of the City of Denton, Texas providing for, authorizing,
and approving the expenditure of funds for the purchase of four additional
software modules for the CrewManager software program currently utilized by
Denton Municipal Electric, which are available from only one source in
accordance with the pertinent provisions of Chapter 252 of the Texas Local
Government Code exempting such purchases from the requirements of
competitive bidding; and providing an effective date (File 3980 to Unique
Business Systems in the amount of $222,717). The Public Utilities Board
recommended approval (5-0).
J. 2008-057 - An ordinance accepting competitive bids and awarding a contract for
the purchase of primary and secondary insulated electric distribution cables for
Denton Municipal Electric; providing for the expenditure of funds therefor; and
providing an effective date (Bid 3941-Single Purchase of Insulated Electric
Distribution Cable awarded to the lowest responsible bidder meeting
specification, Techline, Inc., in the estimated amount of $2,087,679). The Public
Utilities Board recommended approval (5-0).
K. 2008-058 - An ordinance of the City Council of the City of Denton, Texas
authorizing the City Manager or his designee to approve an Encroachment
Agreement between the City of Denton and SFT Industrial, L.P. to allow the
installation of two stainless steel ethanol transfer lines and electric conduit and
service lines and related appurtenances within an existing City of Denton Public
Access and Firelane and Utility Easement; said tract being described as a 43
square foot tract of land situated in the 0. S. Brewster Survey Abstract No. 56,
being part of Lot 1B, Block 1 of Granite Point Addition, Phase 1, an Addition to
the City of Denton, Denton County, Texas, according to the Plat thereof recorded
in Cabinet W, Slide 753-757, Plat Records, Denton County, Texas, and providing
an effective date. The Public Utilities Board recommended approval (5-0).
City of Denton City Council Minutes
March 4, 2008
Page 7
L. 2008-059 - An ordinance of the City of Denton, Texas amending the provisions of
Chapter 6 by amending Section 6-2 definitions to add definitions related to feral
cats; by adding Article III regulating feral cat colonies; providing for a
severability clause; providing for a savings clause; providing for a penalty not to
exceed $500 for violations of this ordinance; and providing for an effective date.
M. R2008-008 - A resolution of the City Council of the City of Denton, Texas
supporting the University of North Texas in the creation of a four-year
comprehensive aviation sciences program at the Denton, Texas campus, and
providing an effective date. The Mobility Committee recommended approval
(2-0).
N. R2008-009 - A resolution reviewing and adopting revisions to the Investment
Policy for funds for the City of Denton; and providing an effective date. The
Investment Committee recommended approval (5-0).
0. R2008-010 - A resolution of the City Council of the City of Denton amending the
City's designated authorized representatives in the Texas Local Government
Investment Pool ("Texpool"); and providing an effective date. The Investment
Committee recommended approval (5-0).
P. 2008-060 - An ordinance approving an employment agreement between the City
of Denton and Robin A. Ramsay reappointing him as the Presiding Judge of the
city of Denton Municipal Court; authorizing the expenditure of funds; and
providing an effective date. The Council Appointee Performance Review
Committee recommended approval (3-0).
Q. 2008-061 - An ordinance approving a salary increase for Steve Shepherd under
the performance review provision of his employment agreement with the City;
authorizing the expenditures of funds; and providing an effective date. The
Council Appointee Performance Review Committee recommended approval (3-
0).
R. 2008-062 - An ordinance approving a salary increase for George C. Campbell
under the performance review provision of his employment agreement with the
city; authorizing the expenditures of funds; and providing an effective date. The
Council Appointee Performance Review Committee recommended approval (3-
0).
S. Approved the minutes of:
February 4, 2008
February 5, 2008
February 12, 2008
February 18, 2008
February 19, 2008
City of Denton City Council Minutes
March 4, 2008
Page 8
T. 2008-063 - An ordinance of the City Council of the City of Denton, Texas
authorizing the City Manager to execute a third amended contract for professional
legal services with Kelsey, Kelsey, Collister & Hickey for professional legal
services relating to litigation styled City of Denton v. Reichmann Petroleum
Corp., Cause No. 2006-40169-362, currently pending in the 362nd District Court
of Denton County, Texas; authorizing the expenditure of funds therefor; and
providing an effective date.
4. PUBLIC HEARINGS
A. The Council held a public hearing and considered adoption of an ordinance
regarding changing the street name of Pearl Street to McKinney Street between Bolivar Street
and Carroll Boulevard. (SI07-0003, Pearl Street Name Change) The Planning and Zoning
Commission recommended approval (6-0).
Brian Lockley, Planning Manager, stated that this request was initiated by North Star Bank to
help eliminate confusion by bank patrons and the general public on this portion of McKinney
Street. Notices were sent out regarding the name change which would only be from Boliver
Street and would stop at Carroll Blvd. As there was no through traffic to the other side of
Carroll, the name change would not affect that area of the street. He detailed the actions taken
by staff and the remaining actions to do upon adoption of the ordinance such as changing out
signs and the Planning staff sending out a letter and a copy of the ordinance to local agencies,
neighborhoods, the utility company, U.S. Post Office and 911.
The Mayor opened the public hearing.
No one spoke during the public hearing.
The Mayor closed the public hearing.
The following ordinance was considered:
N0.2008-064
AN ORDINANCE OF THE CITY OF DENTON, TEXAS, PROVIDING FOR A
STREET NAME CHANGE FROM PEARL STREET TO MCKINNEY STREET
BETWEEN ITS INTERSECTIONS WITH CARROLL BOULEVARD AND BOLIVAR
STREET; PROVIDING FOR SEVERABILITY AND AN EFFECTIVE DATE. (SI07-
0003)
Kamp motioned, Mulroy seconded to adopt the ordinance. On roll vote, Kamp "aye",
Montgomery "aye", Mulroy "aye", Thomson "aye", Watts "aye", and Mayor McNeill "aye".
Motion carried unanimously.
B. The Council held a public hearing and considered adoption of an ordinance of the
City of Denton, Texas, regarding designating the property located at 122 North Locust Street as a
historic landmark under section 35.7.6 of the Denton Development Code; providing for a penalty
City of Denton City Council Minutes
March 4, 2008
Page 9
in the maximum amount of $2000 for violations thereof; and providing for an effective date.
The Historic Landmark Commission recommended approval (7-0). The Planning and Zoning
Commission recommended approval (6-0).
Julie Glover, Historic Preservation Officer, stated that this property already had the designation
of a national registered district and approval of this ordinance would give local recognition to the
property. The opposition comments mentioned use changes and interior changes which were not
covered by the preservation ordinance.
The Mayor opened the public hearing.
No one spoke during the public hearing.
The Mayor closed the public hearing.
The following ordinance was considered:
N0.2008-065
AN ORDINANCE OF THE CITY OF DENTON, TEXAS, DESIGNATING THE
PROPERTY LOCATED AT 122 NORTH LOCUST STREET AS A HISTORIC
LANDMARK UNDER SECTION 35.7.6 OF THE DENTON DEVELOPMENT CODE;
PROVIDING FOR A PENALTY IN THE MAXIMUM AMOUNT OF $2,000 FOR
VIOLATIONS THEREOF; AND PROVIDING FOR AN EFFECTIVE DATE.
Mulroy motioned, Montgomery seconded to adopt the ordinance. On roll vote, Kamp "aye",
Montgomery "aye", Mulroy "aye", Thomson "aye", Watts "aye", and Mayor McNeill "aye".
Motion carried unanimously.
C. The Council held a public hearing and considered approval of a resolution of the
City of Denton, Texas, determining the current rates of the Atmos Energy Corporation, Mid-Tex
Division to be unjust and unreasonable; providing for a reasonable notice and hearing; finding
that the meeting complied with the open meetings act; and declaring an effective date.
John Knight, Deputy City Attorney, presented the background information on the proposed
reso utlon.
The Mayor opened the public hearing.
No one spoke during the public hearing.
The Mayor closed the public hearing.
The following resolution was considered:
City of Denton City Council Minutes
March 4, 2008
Page 10
N0. R2008-O1 l
A RESOLUTION OF THE CITY OF DENTON, TEXAS, DETERMINING THE
CURRENT RATES OF THE ATMOS ENERGY CORPORATION, MID-TEX
DIVISION TO BE UNJUST AND UNREASONABLE; PROVIDING FOR A
REASONABLE NOTICE AND HEARING; FINDING THAT THE MEETING
COMPLIED WITH THE OPEN MEETINGS ACT; AND DECLARING AN
EFFECTIVE DATE.
Kamp motioned, Thomson seconded to approve the resolution. On roll vote, Kamp "aye",
Montgomery "aye", Mulroy "aye", Thomson "aye", Watts "aye", and Mayor McNeill "aye".
Motion carried unanimously.
5. ITEMS FOR INDIVIDUAL CONSIDERATION
A. The Council considered approval of a resolution of the of City of Denton, Texas,
approving a settlement agreement between Atmos Energy Corporation, Mid-Tex Division and
Atmos Texas Municipalities; declaring existing rates to be unreasonable; adopting rate
adjustments consistent with the Settlement Agreement; finding the rates to be set by the attached
tariffs to be just and reasonable; finding that the meeting complied with the open meetings act;
requiring delivery of this Resolution to the company and legal counsel; and declaring an
effective date.
Council Member Thomson left the meeting.
The following resolution was considered:
N0. R2008-012
A RESOLUTION OF THE OF CITY OF DENTON, TEXAS, APPROVING A
SETTLEMENT AGREEMENT BETWEEN ATMOS ENERGY CORPORATION,
MID-TEX DIVISION AND ATMOS TEXAS MUNICIPALITIES; DECLARING
EXISTING RATES TO BE UNREASONABLE; ADOPTING RATE ADJUSTMENTS
CONSISTENT WITH THE SETTLEMENT AGREEMENT; FINDING THE RATES
TO BE SET BY THE ATTACHED TARIFFS TO BE JUST AND REASONABLE;
FINDING THAT THE MEETING COMPLIED WITH THE OPEN MEETINGS ACT;
REQUIRING DELIVERY OF THIS RESOLUTION TO THE COMPANY AND
LEGAL COUNSEL; AND DECLARING AN EFFECTIVE DATE.
Mulroy motioned, Watts seconded to approve the resolution. On roll vote, Kamp "aye",
Montgomery "aye", Mulroy "aye", Watts "aye", and Mayor McNei11 "aye". Motion carried
unanimous y.
B. The Council considered adoption of an ordinance of the city of Denton
authorizing the Mayor to execute a Second Amendment with Aldi (Texas) L.L.C., which was
first amended by the City Council on January 8, 2008 by Ordinance 2008-006, to extend the term
of the Agreement from five years to seven years, or to reimburse Aldi for the design and
City of Denton City Council Minutes
March 4, 2008
Page 11
construction costs of Westcourt Road, whichever is less; providing for a severability clause; and
providing an effective date. The Economic Development Partnership Board recommended
approval (6-0).
Linda Ratliff, Director of Economic Development, stated that this was the second amendment for
this agreement. The original agreement was for Aldi to be reimbursed for construction of the
road. TxDot had placed additional requirements on the project plus added a proj ect. A
temporary right-of way and a four lane intersection would have to be included in the project.
Aldi requested an additional two years on the agreement for the cost of the road. The term of the
contract would be extended to seven years from five and the cost would not exceed the actual
cost of the road.
The following ordinance was considered:
N0.2008-066
AN ORDINANCE OF THE CITY OF DENTON AUTHORIZING THE MAYOR TO
EXECUTE A SECOND AMENDMENT WITH ALDI (TEXAS) L.L.C., WHICH WAS
FIRST AMENDED BY THE CITY COUNCIL ON JANUARY 8, 2008 BY
ORDINANCE 2008-006, TO EXTEND THE TERM OF THE AGREEMENT FROM
FIVE YEARS TO SEVEN YEARS, OR TO REIMBURSE ALDI FOR THE DESIGN
AND CONSTRUCTION COSTS OF WESTCOURT ROAD, WHICHEVER IS LESS;
PROVIDING FOR A SEVERABILITY CLAUSE; AND PROVIDING AN EFFECTIVE
DATE.
Mulroy motioned, Kamp seconded to adopt the ordinance. On roll vote, Kamp "aye",
Montgomery "aye", Mulroy "aye", Watts "aye", and Mayor McNei11 "aye". Motion carried
unanimous y.
C. New Business and Announcements
The following items of New Business were suggested by Council Members for future agendas:
• Council Member Watts - a work session on city initiated construction projects.
• Council Member Montgomery - a work session look at the extension of Brinker Road.
D. City Manager's Report
City Manager Campbell did not have a report for Council.
E. Possible Continuation of Closed Meeting under Sections 551.071-551.086 of the
Texas Open Meetings Act.
There was no continuation of the Closed Meeting.
F. Official Action on Closed Meeting Item(s) under Sections 551.071-551.086 of the
Texas Open Meetings Act.
City of Denton City Council Minutes
March 4, 2008
Page 12
There was no official action on Closed Meeting items.
With no further action, the meeting was adj ourned at 7:22 p.m.
PERRY R. MCNEILL
MAYOR
CITY OF DENTON, TEXAS
JENNIFER WALTERS
CITY SECRETARY
CITY OF DENTON, TEXAS
CITY OF DENTON CITY COUNCIL MINUTES
March 25, 2008
Joint Meeting of the City of Denton City Council and the Planning and Zoning Commission on
Tuesday, March 25, 2008 at 8:00 a.m. in the Community Room of the Civic Center.
Council Present: Mayor McNeill; Mayor Pro Tem Kamp; Deputy Mayor Pro Tem Mulroy;
Council Members Heggins, Montgomery, Thomson, and Watts.
Council Absent: None
Commissioners Present: Commission Chair Watkins; Vice-Chair Eagleton; Commissioners,
Lyke, King, Thomas and Schaake
Commissioners Absent: Commissioner Anderson
1. Call to order; announce quorum, introductions.
Mayor McNeill and Commission Chair Watkins announced that a quorum of their members were
present and introductions were made.
2. The Council and Commission received a report and held a discussion regarding a variety
of topics related to development regulations, procedures, and other matters within their mutual
responsibilities.
Mark Cunningham, Director of Planning and Development, presented the outline of the
meeting's topics which included an outline of the development review processes, development
code amendments, direction on facilitating future discussions and direction on presentation of
public hearing items.
Cunningham stated that staff would like direction on the presentation of public hearing items. If
the Planning and Zoning Commission made changes to the staff recommendation, would the
Council like to have both the staff recommendation and the recommendation from the
Commission or just the final comments from the Commission? The current practice was not to
include the discussion from the Commission, just the recommendation.
Council/Commission discussion -
Mayor McNeill felt that he would like to see the staff recommendation and the discussion that
caused that discussion to occur.
Deputy Mayor Pro Tem Mulroy felt that if the issue was controversial with citizen involvement,
he would like to read that in the minutes and have all the information to evaluate the issue and
also see what changes the Commission made. With all that information, he would be able to
answer citizen calls on the issue. He felt a complete audit trail on how the issue developed was
needed.
Mayor Pro Tem Kamp felt that detailed minutes produced good information.
Cunningham asked if staff comments should be added to the staff report or just the Commission
recommen atlons.
City of Denton City Council Minutes
March 25, 2008
Page 2
Mayor Pro Tem Kamp stated that she would like both.
City Attorney Snyder asked about the situation of remanding issues back to the Commission.
Council Member Watts stated that Council usually did not remand an issue back to the
Commission unless there was true new information that the Council had received that the
Commission did not. He felt that he would like to see as much information as possible in the
case when the staff recommendation was different than the Commission recommendation.
Mayor Pro Tem Kamp felt that it was rare for the Council to send something back to the
Commission and when it was done, it was because the Council had received new information.
City Manager Campbell stated that when the Council held a public hearing, there might be new
information from citizens and not j ust new information from developers.
Mayor McNeill also stated that he looked at the Commission as the place where the experts were
which was an additional rationale for remanding back to the Commission if new information
were receive .
Council Member Heggins stated that if the Council received pertinent information that the
Commission had received, the Council could then reject or accept the information.
Commissioner King felt that if the Council had a feeling on how to proceed with an issue, then
he would like the Council to go in that direction, rather than send it back as that presented more
meetings for the developer.
Commissioner Lyke felt that if a developer knew the issue would be remanded back to the
Commission, he might not do a poor presentation at the Commission and then present Council
with new and better information. That was part of the checks and balances.
Commissioner Schaake stated that sending an issue back to the Commission because of new
information was good for the process and there might be a new decision by the Commission,
trusting Council's judgment that there was new information.
Consensus was to bring as much information as possible for public hearings.
Cunningham presented information on the Development Review process. Currently the pre-
application process was optional. The pre-application process provided applicants with the
ability to gather information to assess the feasibility of a proposed project, as well as to attain
general information about the procedures required to complete the project. The proposal was to
make pre-application mandatory for all projects which would allow staff to provide information
to applicants up front and reduce time and money spent on proj ects that could not be completed.
Another consideration was apre-submittal conference which would be a broad brush overview
of proposed projects. At the pre-submittal conference, a developer would present the basic
project and staff would tell the developer what would be needed to do the project with the
various departments such as Planning, Engineering, etc. The conference would inform the
developer of what would be needed to make his project proceed smoothly. Cunningham asked if
Council would like to proceed with making the pre-application meeting mandatory.
City of Denton City Council Minutes
March 25, 2008
Page 3
Deputy Mayor Pro Tem Mulroy stated that the original intent of this meeting was to go through
the development process step by step and that he would like to review the process before starting
to ma e c olces.
Cunningham presented a flow chart of the standard review development review process. The
initial review process took approximately 19 days to process. The flow chart indicated how the
process proceeded depending on various options.
Deputy Mayor Pro Tem Mulroy asked about the role of Freese and Nichols in the development
review process.
Bryan Lockley, Planning Manager, stated that Freese and Nichols did the actual engineering
review of proposed water lines, streets, etc. and produced a report as to whether they were at city
standards.
PS Arora, Interim Development Review Administrator, stated that all of the comments that were
compiled from Freese and Nichols was a process which an associate engineer did before that
position was eliminated.
Council and Commissioners discussed the role of Freese and Nichols in the development process.
Commission Lyke left the meeting
Commissioner Eagleton asked whether there was a cost difference for Freese and Nichols to
perform the review as opposed to city staff and did that affect what an applicant had to pay.
Deputy Mayor Pro Tem Mulroy stated that the primary role of Freese and Nichols was to do an
engineering validation of a proposal to make sure it was in accordance with city standards. This
function was given to an outside resource on the rationale that the work load in the development
review process was inconsistent and then the outside firm would deal with the peaks and valleys
in the development process.
Commissioner Thomas noted that the time frames on the flow chart were not necessarily
accurate. There were situations when more requirements might be needed up front from the
developers such as a more detailed site plan or more information on the actual building and what
it would house. Also, there was nothing on the application that told a developer that he could
find information on the TrakIT system.
Lockley stated that the Development Review Committee meeting was only for city staff and that
comments from that meeting were entered into TrakIT which a developer could access. Another
issue was the quality of the review. The current practice did not include a preliminary review of
the plans; rather it j ust made sure that it had been submitted.
City Attorney Snyder noted the vested rights statute which developers have used in the past
against cities. He suggested not making the pre-application meeting mandatory as a developer
might present a sketchy application and then claim vested right. He suggested making the pre-
City of Denton City Council Minutes
March 25, 2008
Page 4
application process more available as opposed to making it mandatory. If it were required in the
development process, it could be considered a permit.
Consensus of the Council was to draft an ordinance for consideration which would change the
process to require a mandatory orientation to review how a project needed to be submitted, using
a past project as an example of how to or how not to submit a proj ect. This would be done prior
to actual submittal of a proj ect.
Cunningham continued with the flow chart process for revisions and the secondary standard
review process.
Council and Commissioners discussed the possibility of a monetary incentive for developers to
submit plans correct the first time rather than having to come back time after time with revisions.
Cunningham stated that there were times when comments created needed revisions and felt that a
better procedure might be to have the applicant attend the Development Review Committee
meeting so all were on the same page. Staff could have a staff only pre-meeting to discuss the
project so all were aware of proposed comments/changes to a development before meeting with
the developer.
Cunningham continued with Alternative Development plans. These were intended to provide
opportunities for developments to deviate from certain Development Code requirements, while meeting and exceeding other requirements of the Code. Staff observations of this
process noted
that it allowed submittal of an ADP without a plat or SUP and that it could add additional
time/cost to the review process. Staff questioned whether the ADP process should be used to
achieve an alternative design or could it also be used to acquire trade-offs of minimum standards
uring t e process?
After discussion, Council and Commission felt that the ADP should be used for the site plan
design only with no trade-offs.
Cunningham next presented information on Building Permits. Currently building permits could
be submitted while other applications were in process such as an SUP, ADP or plat. Staff
observations were that changes made to a site plan for an ADP or SUP were not made to building
permits in a timely manner; changes made to address Building Permit Review comments might
be impacted by changes required for other associated applications and the timing of applications
such as building permits and SUPS.
Consensus of the Council and Commission was that the building permits could be parallel
through the process with other applications.
The Specific Use Permit process was presented by Cunningham. Staff observations questioned
if an SUP authorized the use only, or did it tie an applicant to the site and also the timing of an
application if an ADP were approved but a SUP was denied.
City of Denton City Council Minutes
March 25, 2008
Page 5
Consensus of the Council and Commission was that the two could be separated, a variance was
not dependent on the site plan but the site plan review should be on hold until the ADP or SUP
was approved.
Commissioner Schaake left the meeting.
Cunningham continued with Subdivision Variances. Staff observations questioned whether
variances could be considered and approved without an accompanying plat and whether
approved variances went with the land. Staff proposed creating an Administrative Waiver
Process that would be project specific and would require plats before accepting variance (waiver)
applications. If the proj ect went away, the variance would go away.
City Attorney Snyder indicated that such a process would have to be researched to determine if
staff could administratively approve certain variances.
Consensus of the Council and Commission was to research whether the proposed process could
be done and return with options/suggestions. Part of the research would include whether a time
limit could be placed on a variance such that the variance would expire if not built in within a
certain period of time
Staff review and applicant responsibility was the next category reviewed by Cunningham. This
situation involved an item not specifically referenced in a review that must still meet Code requirements. Staff observation was that applicants relied on staff
to direct them on all necessary
changes rather than taking care of it. That put staff in the position of designing projects for
developers rather than reviewing a completed plan for Code compliance.
Council and Commission felt that the proposed procedure of the mandatory overview meeting
would help with this situation.
Lockley reviewed the Aldi project as it went through the development process as an example of
how the procedures worked. Staff observation during the process was that changes made to
preliminary plats were not always consistent with final plats and suggested making preliminary
plats optional in certain situations. Lockley then reviewed the Kroger Center project. During
that project, staff observed that the TxDOT permit application review added additional time to
the overall review process. Staff was proposing to explore the possibility of the applicant
applying for a TxDOT permit concurrent with an initial submittal.
Council and Commission suggested that it could be recommended in the mandatory orientation
session. Another agency to consider would be FEMA for early submittal
Cunningham presented information on Code Amendments. He stated that staff from several
departments had formed an internal committee to discuss future Code amendments. The
committee consisted of individuals from Planning, Building Inspections, Code Enforcement,
Legal, Engineering, Fire and DME. To date, over 70 potential amendments had been identified,
ranging from minor clerical corrections to the rewriting of entire chapters. The most problematic
Code amendments were currently being brought forward to the Planning and Zoning
Commission for consideration.
City of Denton City Council Minutes
March 25, 2008
Page 6
Mayor McNeill stated that when the Code was passed, mandatory reviews were required every
quarter with the public invited. He asked how that was being advertized.
Lockley stated that the most interest came from the development community. Invitations were
sent out and notices publicized.
Mayor McNeill stated that there were many items in the code that dealt with enforcement and
should be in an enforcement chapter.
Lockley replied that a separate chapter was being developed for enforcement issues.
Commissioner Thomas felt that there were still some big holes in the Development Code because
of changing consumer taste and preference. He felt there was nothing in the Code dealing with
redevelopment; that it currently only dealt with green field development. That issue needed to be
addressed.
Commissioner Eagleton felt that a topic for future discussion would be developments on a
medium scale and incentives for smaller developments.
Deputy Mayor Pro Tem Mulroy suggested additional future topics of discussion might include a
small area planner and small area plans, land use planning, and future land use planning.
With no further business, the meeting was adjourned at 11:25 a.m.
PERRY R. MCNEILL
MAYOR
CITY OF DENTON, TEXAS
JENNIFER WALTERS
CITY SECRETARY
CITY OF DENTON, TEXAS
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: Transportation Operations
ACM: Howard Martin, 349-823
SUBJECT
Consider an ordinance authorizing the City Manager to approve a third amendment to a
commercial airport operations lease agreement approved by Ordinance 2004-362 dated
December 1, 2004, between the city of Denton, Texas and Jet Works Aviation, Inc. on
approximately 1.912 acres of land at the Denton Municipal Airport; and providing an effective
date. (Mobility Committee recommends 3-0. Airport Advisory Board Recommends 6-0).
BACKGROUND
On November 16, 2004 the City of Denton and Jet Works Aviation, Inc. (Jet Works Air Center
Management, LLC) entered into an Airport Commercial Operator Lease Agreement. Provisions
of the lease required that Jet Works lease more than 83,000 square feet of airport property at a
rate of $0.20 per square foot and build ahangar/office/shop complex of approximately 26,000
square feet. Jet Works relocated to the Denton Airport in January 2005 from Meacham Airport
in Ft. Worth and brought 35 employees. Jet Works moved into their newly completed 38,000
square foot facility at the Denton Airport in March of 2006 and as of March 2008 Jet Works
reported 115 employees.
Jet Works Air Center landed a contract with Piaggio America and was recognized in September
2006 as Piaggio Aircraft's North American Completion Center. The contract with Piaggio along
with continued growth in the corporate aviation market has resulted in extensive growth for the
Denton Airport based company. Jet Works is seeking to amend their current lease agreement to
add an additional 101,907 square feet or 2.339 acres of property to their leasehold. The proposed
development calls for a minimum of 40,000 square feet of additional hangar, office and shop
area as well as the construction of an additional 20,000 square feet of private aircraft ramp. The
improvements will assist Jet Works in expanding their market share and will add an additional
45 jobs to the airport workforce. The proposed expansions will tie-into the existing Jet Works
structure located at the north end of the Terminal Apron and south of Warbird Lane. The
proposed development is outlined in a site plan identified as Exhibit B and is incorporated in the
proposed Third Amendment to the lease agreement. The Third Amendment is attached as
Exhibit 2 of this Agenda Information Sheet.
Jet Works Aviation Management, LLC acquired Jet Works, Inc in July 2007. "Jet Works" has
been an anchor tenant on the Denton Airport since 2005 and has been an excellent corporate
partner in fulfilling the obligations of their lease agreement along with marketing both the airport
and the community. The proposed lease amendment and associated development is in
accordance with the 2003 Airport Master Plan.
AI S -Jet Works Amendment
March 25, 2008
Page 2 of 2
PRIOR ACTION/REVIEW
The Mobility Committee recommended approval 3-0 on March 25, 2008. The Airport Advisory
Board recommended approval of the proposed amendment on March 21, 2008 by a 6-0 vote.
FISCAL INFORMATION
The lease rate for the Third Amendment is $0.25 per square foot. The proposed amendment will
generate an additional $2,123.06 monthly rent resulting in a total annual increase of $25,476.75
in ground lease revenue for the City. The lease rate shall be adjusted by the Consumer Price
Index-U as set forth in the original lease and as required by the Federal Aviation Administration.
EXHIBITS
1. Ordinance
2. Amendment III
3. Ordinance 2004-362
4. Mobility Committee Draft Minutes
5. Airport Board Draft Minutes
Respectfully submitted:
Mark Nelson
Transportation Director
~ ~ ~ :lour doc~met~tslcor~tracts1~81jet works air ~~~ter Ord amer~drnent mgr 2~~8,doo
EXHIBIT 2
THIRD AENDN~ENT T~ THE
AYRP~RT LEASE AC~REEIVIENT
v~ITH JET ~R~S ASR CENTER ANAl1~~NT, LLB
S~'ATE ~F TE~.AS ~
§ KN~ ALL N~EN THESE PRESENTS:
~~1NT~ DENTIN ~
This Third Amendment is made executed to be effective as of the ~ day of A ril, p
BOOS to that certain Airport Lease Agreement between the pity of Denton, Texas, ~ munici al . F
corparatron, hereinafter referred to as "Lesar'} and JET ~V~RI~S AlR CENTER
ANAEl1~ENT, LLB, a Texas limited liability company, hereinafter referred to as "Lessee"
Bch executed to be effective as of the ~`irst day of December, ~a04., and ubse uent~ ~t ~
amended an the ~ 1 day of June, ~0~5 and again an the 1 ~ day of August, ~a~5 hereinafter referred to a "Base Lease".
VITNESSETH:
~IEREA, the Lessor and Lessee ash to amend the Base Lease to add approximately
2.~~~ acres to the Base Lease and make certain other changes to the Base Lease;
THEREFORE, far and in consideration off` the pr~rnises and the mutual covenants
contained ~n this A.green~ent, the parties agree to amend the Base Lease as follows:
SETI~N ~ . Section ~~..A., D., E., "Leased Premises", Section A and
"Payments, Rentals and Fees," Section v7I "Special conditions" and Section VIZ ~`Leasel~oid
~npravements" are hereby amended sa as to add the fa~~ong thereto;
I~, LEASED PREMISES .
Lessor, far and in considerat~an of the covenants and agreements herein contained, to be
dept by Lessee, and subject to the conditions contained herein, does hereby derriise and lease
unto Lessee, and Lessee does hereby lease from Lessor, far the lease term described in Article
IZI, the following described land situated in the pity of Denton, Denton bounty, Texas;
A. LAND. tract of land, being approximately 1 a 1,~~7 square feet drawn and outlined
and described on Exhlb~t "A and B}' such exhibits being inca~porated herein by reference the
"Leased Premises"},
Together with the right of ingress and egress to the Leased Premises; and the right in
camrnon with others sa authorized of passage upon the Airport property generally, sub' ect to
• ~ F reasonable regulations by the 1ty of Denton and such rights shall extend to Lessee's ens to ees,
pY passengers, patrons and invitees, For purposes of this Agreement, the term. "Leased Premises"
shall include leasehold improvements constructed by the Lessee, but not includin certain
g easements or property av~ned andlar controlled by the Lessor
EXHIBIT 2 '
~ r ~ y
r Y i
~ description of expanded lease area, Parcel is attached to this Amendment as Exhibit
'r~", A legal descript~an providing the metes and bounds of the leased pro ert will be attached • ~ Y
to this Third Amendment as Exhibit "A "
D. Z1VIpR~vEENT PR~~~DED BY LESSEE.
3. onstruct~an of Panel 2 Im rove~nents. ~n Parcel 2, Lessee shall construct a
commercial hangarloffce facility of not less than 4a,Daa square feet with a minirrxu door
height of feet and a min~n~um door wzdth of 1 Oa feet, and an additional rivate aircraft a ran ~ ~
of apprax~ately 20,aaa ~"parcel 2 ~n~praven~ents"}, Construction of Parcel im rovemer~ts p
shall be commenced no later than ~7a days after the Effective Date of this Amendment and
completed na later than 72a days after the Effective Date the "anstr~action Period" .
~onstruct~an of Parcel 2 ~mpravements are considered complete u on the issuance of a P
certrf ~cate of occupancy for e enure hanarloffice faci~~ty.
E, EAEN~ENT. Lessee is aware of an existin storm sewer located east of the . g
exlstrng hangar an parcel 1 and running through the proposed develapr~ent site and a reel to an g easement far said infrastructure should the storm sewer need to
be relocated as art of the
P evelapment proposal.
F. ASE T~ ~JTYL~TIE~. f ,esar represents that there are water, seer, natural a~s
. g and electricity lines situated upon the A.~rport within 2~o feet of Parcel 2. Lessee shall be
respansibie far extending sa.~d 11nes to the Leased Premises at Lessee's sole ex ense.
p
YV. PAYMENTS RENTALS AND p`EE
A. LAND REN~. Land rental shall be due and payable to Lessor in the sum of ~~.~5
per square foot ar appromately $~5,47~.75 per year. Rental shall be due and a able to Lessor
Py . in twelve ~ I } equal monthly znstall~nents the sum of approximately 2, l 23.OG er month in
dvan ~ ce, an or before the I st day of each and every month during the term of this .Lease
Agreement. Lessee has the option to pay annual rentals and fees in whale on or bcfare the ~1 st
day of October, at the beginning of the pity's fiscal year, each and eve ear of this Lease
~'Y y Agreerr~ent.
. PAYMENT pENALT~Y ADJUTII~ENTS. parcel ~ shall enjoy the same terms for
rental adjustments as Parcel ~ however, each rental adjustment, if any, an Parcel shall occur on
the 1 day of October, beginning 2a I D, and eve other ear thereafter.
y
vII. PEIAL C~NDITION~
~ t ep t%
E ~ ~ t 1. r
RUNWAYS AND TAwAYS. Because of the present one-hundred thousand 1 a~ D0~ . . ~ ~ ~
pound continuous use weight bearing capacity of the Denton 'art rim taxiwa and ~nwa ~ p ~ y y
system ,Lessee herein agrees to limit all aeronautical activity includrn landi~, tape-off and ~
taxirng~ to aircraft havnag an actual weight, including the weight of its fuel, afone-hundred thousand
Oo,~~O) pounds or less, until such time that the runway and deli ated taxiwa ~ on the Ai ort y ~
have been improved to handle aircra~ o~ such excessive Wei ts. It is further a eed that based . gr an
qualified engrneerm studies, the weight restrictions arrd provisions of this clause a be ad'usted Y ~
up or down, and that Lessee agrees to abide by any such changes or revisions as such studies rna y
dictate. "'Aeronautical actzvity" referred to in this clause shall include an ctivi o~ the Lessee ar . ~
its agents or subcontractors, and its customers and invitees, but shall not include thane activities over
which it has na solicitory part or control, such as an unsolicited or unscheduled or en~er enc
landin A ' • ~ g y pattern of v~alat. the provisions of this section on two or more occasions shall be
sufficient to cause the inln~.ediate termination. of this entire Lease A Bement and sub'ect Lessee to ~
liability for any damages to the Airport that rnlght result, .
VIA. LLASEI~~LD IIVfPR~~IE~NTS
LAND DENTAL. Lessee may begin clearing and grading activities with written approval from the Airport Manager. Lessor shall not be financially liable far an costs
should
the Federal Aviation Adtnrnrstratron or Texas Department of Trans orttion Aviation not
p ~ } approve the FAA Farm ~4~ and related development documentation.
~ETI~N Save and except as amended hereby, all the rem.ainin clauses sentences
g ~ , paragraphs, sections and subsections of the Base Lease shall remain in full farce and effect and
shall fully apply to the additional property and improvements aid e~ anded Leased Premises
. p resulting from this Th~xd Amendment of the Base Lease.
IN wITNBSS w~IEI~E~F, the parties have executed this Lease A een~ent a of the
effective date first above written.
CITY ~F DENTDN, TB~AS, L~SS~R
BY;
G~~~~ , CAB~LL, CITY ~VIANAC~
ATTEST:
JENNIFER wALT~~S, C f TY S~CR~TA~.Y
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S:10ur Documentsl0rdinances1041Air~.~lt Lease-Jetworks.doc
EXHIBIT 3
ORDINANCE NO . ~ ~
AN ORDINANCE APPROVING A COMMERCIAL OPERATOR AIRPORT LEASE
AGREEMENT BETWEEN THE CITY OF DENTON, TEXAS AND JET WORKS
AVIATION, INC. AT THE DENTON MUNICIPAL AIRPORT; AND PROVIDING AN
EFFECTNE DATE.
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS;
SECTION 1. The City Manager or his designee is hereby authorized to execute an airport
lease agreement for commercial operator between the City of Denton and Jet Works Aviation,
Inc. at the Denton Municipal Airport, in substantially the form of the Airport Lease Agreement
which is attached to and made a part of this ordinance for all purposes.
SECTION 2. This ordinance shall become effective immediately upon its passage and
approval.
PASSED AND APPROVED this the day of , 2004.
EULIl~E BROOK, MAYOR
ATTEST;
JENNIFER WALTERS, CITY SECRETARY
BY.
S
APPR ED AS TO LEGAL FORM, ~ r,
HERBERT L. P UTY, CI ATTORNEY
BY;
EXHIBIT 3
------r-
Jet works Lease-FinaI,DOC
AIRPGRT LEASE AGREEMENT C~JMMERCIAL OPERATGR
This Lease Agreement is made and executed to be effective as of the First day of
December, 2004 (the "Effec~ve Date"} at Denton, Texas, by and between the City of
Dentin, Texas, a municipal corporation, hereinafter referred to as "Lessor", and Jet works
Aviation, Inc., a Texas corporation, hereinafter referred to as "Lessee'f .
~J.TNES SETH;
WHEREAS, Lessor now ovcros, controls and operates the Dentin IViunicipal Airport
the "Airport"~ in the City of Denton, County of Denton, State of Texas; and
'~~EREAS, Lessee desires to lease certain prerni.ses at the Airport and construct and
maintain an aircraft hangar and related aviation facilities thereon;
NGw, THEREFQRE, far and in consideration of the promises and the n~~utual
covenants contained in this A.greernent, the parties agree as follows:
I, C,~1~17r1't~}1~S (~F T , ,A ~F~ A ~ ~F,ME~T
NOTwITHSTANDI~TG ANY LANGUAGE TG THE CflNTRAR.Y HEREINAFTER
CCNTA~TED, THE LANGUAGE IN PARAGRAPHS A THRaUGH D ~F THIS
SECTION SHALL BE BINDLNG.
A. ~C',TP~ ~ ,S ~F PF,R A .T~N~. The right to conduct aeronautical and related
activi~es for furnishing services to the public is granted to Lessee subject to Lessee
agreeing:
To ash said services on a fair, equal and not unjustly discriminatory basis
to all users thereof; and
2. To chaxge fair, reasonable and not unjustly dlscrinlinatorypnces for each unit
or service; provided, that Lessee nay be allowed to make reasonable and
nondiscriminatory discounts, rebates, or other similar types of price reductions
to volume purchasers,
Nt~T~ , ~TN~T~N; Lessee, far itself, its personal. representatives,
successors, and assigns, as a part of the consideration hereof, does hereby
covenant and. agree as a covenant running with the land that.
1. No person on the grounds of race, religion, color, sex, or national origin shall be excluded from participation in, denied the benefits of, ar be otherwise
subjected to discrimination in the use of said facilities;
2. In the construction of any impxovements on, over, ar under such land and the
t
furnishing of services thereon, na person an the grounds of race, religion, color, sex, or national origin shall be excluded. from participation denied
the benefits of, ar otherwise be subjected to discrimination;
:f
3. Lessee shall use the premises in compliance with all other requirements
imposed by ar pursuant to Title 49, Code of Federal Regulations, Department
of Transportation, Subtitle A, mice oi' the Se~r~tary, Part 21, Nondiscrhni-
nation in Federally assisted programs of the Department of Transportat7.on -
Effectual of Title VI of the Civil Rights Act of 194, as said Regulations may
be amended.
C, RT~, CHT „(~F ~1~Ti~IJALS TC~ 1~ATNTATN ATR~'RAFT. 7t is clearly
understood by Lessee that na right or privilege has been. granted which would operate to
prevent any person, firm or corporation operating aircraft on the Airport from performing
any services on its own aircraft with its own regular employees (including, but not limited to, m.ainterlance and repair) that it may choose to perform,.
D, L~~N-F ~C~ ,t 1SlVF~ R-T~THT, It is understood and agreed that nothing herein
contained shall be construed to grant or authorize the granting of an exclusive right within.
the meaning of Title 491J.S.C. Appendix § 1349.
E. p~ ~t~' A ,EA
1. Lessor reserves .the right to furthex develop or improve the landing area of the
Airport as it sees fit, regardless of the desires or views of Lessee, and without
. interference or hindrance.
2. Lessor sha11 be obligated t4 maintain and keep in gaol repair the landing area of the Airport and a1I publicly owned facilities of the Airport; together with the
right to direct and control all activities of Lessee in this regard.
3. During time of war or national emergency, Lessor shall have the right to Lease
the landing area ar any part thereof to the United States Cxove~nment for
military or naval use, and, if such lease is executed, the provisions of this
instrument insofar as they are inconsistent with the provisions of the lease to
the Govern.nlent, shall be suspended.
4. Lessor reserves the right to take any action it considers necessary to protect the
aerial approaches of the Airport against obstru.ctior~, together with the right to
prevent Lessee from erecting, or permitting to be erected, any building or other
st~uct~re on or adj aunt to tie ...Airport. which, in the opinion of Lessor, would
limit the usefulness or safety of the Airport or constitute a hazard to aircraft or to aircraft navigation. The hangar/of~icelshop complex as currently proposed
as provided in Section ~,D. does not violate this provision.
S. This Lease Agreement shall be subordinate to the provisions of any existing or
AIRPORT LEASE AGREEMENT Jet works -Page 2
future agreement between Lessor, and the United states ar agency thereof, relative to the operation ar maintenance of the Airport.
n. T,F,A,~F,T~ P ,MT~F~
Lessor, for and in consideration of the covenants and agreements herein contained, to
be kept by Lessee, does hereby demise and lease unto Lessee, and Lessee dies hereby lease
from Lessor, for the lease term described in .Article III, the following described land situated
1n Denton County, axis:
A. Land. A tract of land, being approximately 200 feet by 275 feet by 240 feet by 270
feet or 1.336 acres, drawn and outlined an Attachment "A", and legally described 1n
Attachment `B" as Parcel I, such attachments being incorporated herein by refexence the
"Leased Premises").
Together with the right of ingress and egress to the Leased Premises; and the right in common with others so authorized of passage upon the Airport property generally,
subs act
to reasonable regulations by the City of Denton and such rights shall extend to Lessee's
employees, passengers, patrons and invitees, For purposes of this agreement, the term
"Leased Premises" shall mean all property located within the metes and bounds described
and identified within Attach~.ent including leasehold improvements constructed by the
Lessee, but not including certain easernen~s or property owned and/or controlled by the
Lessor,
A legal description of the leased prelx~ises is not currently attached as Attachment "B".
Lessee shall deliver to Lessor no later then 30 days after the date of this Agreement a legal
description of the leased premises accurately describing the leased premises that is
acceptable to Lessor. If Lessee fails to da so, Lessor at its option may terminate this
Agreement, in which case it will Dave no further force and effect. The apprave~ legal description w11I be attached to this Agreement as Attachment
B. gj h of Firs Re 1_ Sa rang as Lessee i~ in compliance with all construction
requirements Pegg to Lessee's Improvements asset forth in Section II.D. below and is
not in default of any term or condition of this Lease Agreement, ,Lessee shall have a right
of first refusal the "Right of First Refusal"}to lease Parcel 2 which is mare particularly
described in Attachment "A"ar any portion thereof to which Lessax receives a written offer
to lease (the "Offer to Lease"}. The Right of First Refusal shall be effective for a period of
three ~3) years after the Effective Date the "Option Period"}.
Should Lessor receive an Offer to Lease from a third party during the Option Period
that Lessor has an interest in cansumma~.ng, Lessor shall give Lessee a written notice of
such Offer to Lease along with a copy of ,said Offer to Lease the "Notice"}. If Lessee
desires to exercise its Right of First Refusal it shall no later than 45 days after the receipt of the Notice tender to Lessor a signed written lease with identical terms and
candifians as are
contained in the Offer to Lease the "Dead Line"}. If Lessee fails to meet the Dead Line, the
Right of First Refusal will be null and void and of no further force and effect.
AIRPORT LEASE AGREEMENT Jet Works -Page 3
I
C,~R~~1~R~1 j,~['~ P 4~ , F~ ~,F,~~~~: The only improvements provided by
Lessor, except as set forth in Article IT,F. "Access to Utilities" below, sha11 be as follows:
. Lessor shall continue planning efforts with the Texas Departn~.ent of Transportation,
Aviation Division ~TxLiaT} to co~.plete ~e planned expansion of the north terminal apron
as .depicted in green an Attachment A. The Lessor will complete the conslruction of this
planned apron expansion prior to Lessee's completion of Lessee's Impravements,~ subject to
the receipt of funding from Texas Department of Transportation ~"TxDot"}. Should TxDat
not provide the necessary funding in order to ~.eet this deadline then Lessor will complete a
portion of planned apron expansion that is at least 100 feet wide adjacent to Lessee's hangar
facilities on Parcel 1, tapering to 50 feet wide to provide access to Taxiway Alpha. when
Lessor receives the necessary fianding from TxDot, Lessor will complete the remainder of
planned apron expansion.
Lessor shall complete construction of water utility infrastructure for a looped
extension for a minimum six-inch water line approximately 1,000 feet in length prior to the issuance of a certificate of occupancy for Lessee's Improvements.
The term "Lessor improvements" sha11 mean those things on or adjacent to the Leased
Premises belonging ta, constru.cted by, or to be constructed by the Lessor. Unless otherwise
noted herein, all Lessor improvements are and will remain the property of Lessor, A1I
Lessor impravements must be described in detail above, or above referenced and attached to
this Agreement in an exhibit approved by Lessor.
D,. Il~IPRf~~EMF.NT~.~~1Tf)F~D._RV T. ,~~FE~ do the Leased Premises, Lessee
shall construct ahangar/officelshap complex with a. minimum of 26,O~a square feet. The
hangar space shall be a mini~.um of 18,00a square feet and the office/shop space shall be a
minimum of 8,004 square feet. Lessee shall. construct an aircraft staging ramp 20 feet by
270 feet that will access the public ramp south of the proposed facility. Lessee shall also construct appropriate culverts or drainage as required by City ordinances in the utility
right
of way south and north of the proposed hangar as well as other improvements as determined
necessary by City ordinances ~A11 above described impravements to be constructed by
Lessee are called the "Lessee's Improvemments"~. Construction of Lessee's Improvements
shad be commenced no later than 270 days and completed no later than 720 days ai~er the
Effective Date the "Construction Period"}. Construction of Lessee's Improvements are
considered commenced upon issuance of a building permit and construction of any portion
of the hangar/off~celshop complex. Construction of Lessee's Improvements are considered
complete upon the issuance of a Certificate of occupancy for the entire hangarlofficelshop
complex, and the aircraft staging ramp and drainage and utility improvements are
completed.
N~atwithstanding anything contained in this Lease Agreement to the contrary, a
failure to complete the Lessee's Improvements within the Construction Period may, at the sale option and discretion of the Lessor, result in the immediate termination and
cancellation of this Lease Agreement upon 30 days written notice of cancellation to
Lessee. In such ease Lessee's rights under the Lease Agreemeut will i~am.ediately
AIRPORT LEASE AGREEMENT Jet Works -Page 4
z ,Q
{~i
cease and be forfeited, and all of Lessee's I~mpravements shall immediately become the
property of Lessor at na cost, expense ar other compensation paid by Less~ar t4
Lessee; and Lessee shall immediately vacate the Leased Premises
E. ~A,~ , ~N' Lessor and Lessee by mutual agreement may establish, an the
Leased Premises, easements for public access an roads and taxiways.
F, A~ ~F~~ T(~ T ITTC, Lessor represents that there are water, sewer and 3-
phaseelectricity lines within cease proximity to the Leased Premises available to "tap-in" by
Lessee, and that the same are sufficient for ,usual and customary service on the Leased
Prernlses.
~
The term of this Lease Agreement shall be for a period of thirty (30) years, cam-
`a~ mencin on the 1st da of December, 2004 and continuing through the 30~ day of g y November of 2034, unless earlier terminated under the provisions
of the Lease Agreement
the "Lease Term"}. Lessee has the option to renew for two ~2} additional ten X10} year
terms. In order to exercise the first option Lessee must provide written nonce to Lessor of
its intent to exercise the first 10 year option na later than 180 day before the expiration of
the 30 year primary term. Ta exercise the second option such written notice must be
provided no later than 18 0 days before the expiration of the first 10 year option term. The
rental and terms to be negotiated for the option terms shall be reasonable and consistent
with the then value, rentals and terms of similar property an~the Airport.
~1", p A V1Vf F.NT~ R~ A FF~,~►
Lessee covenants and agrees to pay Lessor, as consideration for this Lease Agreement,
the following payments, rentals and fees:
A. L;, shall be due and payable to Lessor in twelve (12) equal month3.y
installments in the sums set forth below, on or before the 1st day of each and every xnanth
during the tez~n of this Lease Agreement. Lessee has the option to pay annual rentals and
fees in whole on ar before the 1st day of October, at the beginning of the Oity's fiscal year,
each and every year of this Lease Agreement.
Annual rent shall be a sum equal to $0.20 per square foot of the land area contained in the
Leased Premises the "Ori ~ al Rent'. Montbly rental shall be 1/12' of the annual rent,
..Notwithstanding the far~g~ing, so long as ~,essee ca~nplies with tb.e construction
requirements of Lessee's Improvements contained in ~~ectian II I~, and is not otherwise in
AIRPORT LEASE AGREEMENT Jet ~warks -Page 5
default of any tern. Qr conditipn of this Lease Agreement the annual rent shall be
reduced to a sum equal to $0.05 per square foot of the land area contained.in the
Leased Premises at the tinl.e of completion of the Leased. Improvements the ,
"Reduced Rent"). Until such time that the Lessee's Tmprove~nents are completed
accordance with Section II,D, Lessee shall pay the Original Rent, Aber
Lessee's Irprovements are completed-Lessee shall pay the reduced rent-through
11-30-2007 and will be entitled to a refund or credit far the amount paid in excess
of the Reduced Rent for the period of this Lease Agreement up to and through the
date of completion of Lessee's hmprovements.
?.-1-2~~7,~ rl~ l 1-~(~-2(134'
Annual rent shall be a sum equal to X0,20 per square foot of land area contained
in the Leased Premises as adjusted in accordance with Section IV,C. this regard
the rent beginning 12-1-2007 may be greater than,$0,20 per square feet. Monthly
rental shall b e t/ 1 Z~ o f the annual rent,
Notwithstanding the foregoing, the annual Lease rental will be reduced by the current lease
rate per square foot, as adjusted by the CPI-U referenced in Section I,V,C,, times the number
of square feet comprising all easernen#s established in accordance with Section II,E„
B, j,F,~~(~R TMPR~~'~ ~ R~NTAT_~ ,NONE: There are no Lessor
improvements on the Leased Premises,
C, p YMF,~jT_ PFNAT,TY_ AI~T[ l~ . T~, ,All payments due Lessor from Lessee
shall be made to Lessor at the offices of the Finance Department of the City of Denton,
Customer Service Division, 60I west Hickory, Denton, Texas, unless otherwise designated
in writing by the Lessor. If payments are not received on. or before the 15~' day of the
month, a five percent ~5%) penalty will be due as of the 16th, If payments are not received
by the first of the subsequent month, an additional penalty of one percent ~1%) of the unpaid
rentaUfee amount will be due. A one percent (1°/a) charge will be added are the first of each
subsequent month until the unpaid rentallfee payment is made. The original Rent for the
Leased Premises shall be readjusted at the end of each one year period during the Lease
Term on the bases of the proportion that the then current United States Consumer Price Index for all urban consumers {CPZ-U} far the Dallas-Fort Worth Bureau of Labor Statistics
bears to the previous odd month 2004 index {September), which was ~~L.. {1982-84 =
100), Each rental adjustment, if any, shall occur on the 1st day of October, begi.nnin-g
2006, and every Other year thereafiex on such date.
The adjus~m.ents in the yearly rent shall be determined by multiplying the Original
Rent by a fraction, the numerator of which is the index. number for the last month prior to
the adjus~m.ent, .and the denominator of which is the index number applicable at the
execution of this Lease Ag~eeznent. If the product of this multiplication is greater than
AIRPORT LEASE AGREEMENT Jet Works -Page 6
d
the Original Rent, Lessee shall pay this greater amount as the yearly rent until the time of
the next rental adjustment as called for in this section. If the product of this multiplication
is less than the Original Rent there shall be no adjustment in the annual rent at that time,
and Lessee shall pay the previous year's annual rent until the time of the next rental
adjustment as called for in this section. In no event shall any rental adjustment called far
in t~ section result in an annual rent less than the previous year's annual rent, The
adjustment shall be limited sa that the annual rental payment determined for any given
two-year period shall not exceed the annual rental payment calculated for the previous
CPI adjustment 1}y more than twenty percent (24%}percent.
If the consumer price index for all urban consumers (CPI-U} for the Dallas-Fort Worth geographical region, as compiled by the U.S. Department of Labor, Bureau of Labor
Statistics, is discontinued during the Lease Term., the remaining rental adjustments called
far in this section shall be made using the formula set Earth above, but by substituting the
index numbers for the Consumer Price Index-Seasonally Adjusted U.S. City Average For
All Itern.s For All Urban Consumers (CPI-U~ for the index numbers for the CPY-U
a licable to the Dallas-Fort Worth eo a hical region, If both the CPI-U for the Dallas- Pp g ~ p
Fort Worth eo a hical re 'on and the U.S. City Average are discontinued during ~.e g ~p ~
Lease Term, the remaining rental adjustments called for in this sectia~. shall be made using
the statistics of the Bureau of Labor Statistics of the United States Department of Labor that
are most nearly comparable to the CPI-U applicable to the Dallas-Fort Worth geographical
region. If the Bureau of Labor Statistics of the United States Department of Labor ceases to
exist ar ceases to publish statistics concerning the purchasing power of the consumer dollar
during the Lease Term, the remaining rental adjustments called for in this section shall be
made usin the mast pearl carry arable statistics published by a recognized financial g Y p authority selected by Lessor,
v. R TrTx~r~ ~~1,r. ~ A TI~]~F_3~FS~4~
A. ~j~F, ~F T.F.A~ ,n PR ,MT~E~. Lessee is granted the pan-exclusive privilege to
engage in ov~mer/operator activities providing the following aviation services:
l , ~~ener~l Air :Lessee is granted the non-exclusive xight to
conduct airframe and power plant maintenance.
2. ~ Lessee is granted the non-exclusive right to provide for the sale,
installation and maintenance of aircra~ avionics and associated electrical
equipment.
. 3, ~ nor mace T ,e~s7n~` Lessee is granted the non-exclusive right to rent
hangar space. .
4. ~f~ , , ~ ~ , , T ~ Lessee is granted the non-exclusive right to rent office
space.
5, Ai .r Tnt~in_r.~= Lessee is granted the non-exclusive right to rent space
AIRPORT LEASE AGREEMENT Jet Works -Page 7
r
for the repair, restoration, or reinstallation of aircra~ interior components.
Lessee, its tenants, employees, invitees and guests shall not be authorized to conduct
any services not specifically listed in this Lease Agreement. The use of the Leased Premises
by Lessee, its tenants, employees, invitees or guests shall be limited to only those private,
commercial, retail or industrial activities hav~.g to da with or related to airports and avia-
tion. Except as specifically authorized in this Lease Agreement, no person, business pr
corparatz.an may operate a commercial, retail or industrial business upon the Leased
Pren~i.ses or upon the Airport without a Tease or license from. Lesser authorizing such
commercial retail or industrial activity. The Lessor shall not unreasonably withhold
authari~ation to conduct aeronautical ar related services.
B. ETA ARKS. Lessee shall meet or exceed. the following standards:
1. ~ ress. Lessee shall file with the Airport Manager and keep cu~ent its mailing addresses, telephone numbers and contacts where it can be reached in
an emergency.
2. Imo. Lessee shall ale With the Airport Manager and keep current a list of its
tenants and sublessees.
3. ~ndur~t. Lessee shall contractually require its employees and sublessees (and
sublessee's invitees} to abide by the terms of this Lease Agreement. Lessee
shall promptly enforce its contractual rights in the event of a default of such
covenants, r
4, I T~il;ti ,s,~Taxe,~nd_~ , ,s Lessee sha11 meet all expenses and payments in
connection with the use of the Leased Premises and the ruts and privileges
herein granted, including the trm.ely payment of utilities, taxes, permit fees, license fees and assessments lawfully levied or assessed.
S. Ins. Lessee shall comply with all current and future federal, state and local
laws, rules and regulations which may apply to the conduct of business
contemplated, including rules, regulations and ordinances promulgated by
Lessor, and Lessee shall keep in effect and post in a prominent place all
necessary andlor required licenses ar permits.
1Viai~~c~ ~ ~f prr.Trty. Lessee shall be responsible for the maintenance,
repair and upkeep of all property, buildings, structures and improvements,
Including the mowing or elimination of grass and other vegetation an the
Leased _Pre~ises, a~.d sha]1 keep ~e Leased Premises neat, clean anal in
respectab 1e condition, free from any obj ectional matter ar thing, including J~~ trash or debris, Lessee agrees not to utilize or permit others to utilize areas
an
the Leased Premises which are located on the outside of any hangar or
building far the storage of wrecked or permanently disabled aircraft, aircra~
parts, automobiles, vehicles of any type, or any other equipment ar items
AIR~'ORT LEASE AGREEMENT Jet Works -Page 8
which would distract from the appearance of the leased premises, Lessee
agrees that at no time shall the Leased Premises be used far a flea market type
sales operation.
P ia,~nt~~i~rlin During the Lease Term of this Lease Agreement and
during each extension, Lessor sha11 have the right to require, nit more than
once every five years, that the metal exterior of hangar(s) or buildings}
located on the Leased Premises be repainted. The Lessor may require Lessee
to repaint said exteriors according to Lessor's specifications (to specify color
of paint, quality of workmanship and the year and month in which the
hangars} or building(s) are to be painted, if needed,} Lessee shall complete
the painting in accordance with such specifications within ane (1} year of receipt of notice from Lessor, Lessee agrees to pay all costs and expense
involved in the hangar ar building painting process. Failure of Lessee to
complete the painting required by Lessor, within the ane (1) year period shall
constitute Lessee's default under this Lease Agreement.
g, ~,~~~u~e of T.. a.:e~ Pren~~e_s, Lessee may not use any of the Leased
Premises far any use not authorized herein unless Lessor gives Lessee prior
written approval of such additional use. Without limiting the foregoing the
Leased Prern.ises sha11 not be used for the operation of a motel, hotel,
restaurant, private club or bar, apartment house, storage of recreational
vehicles, automobiles, or marine vehicles, or for industrial, commercial, retail,
or other purposes, except as authorized herein.
9. It is expressly understood and agreed that no dwelling or domicile may be built, moved to or established on or within the Leased Premises nor
may lessee, its tenants, employees, invitees, or guests be permitted to reside or
remain as a resident on or within the Leased Premises ar other Airport
premises. .Lessee may have a pilot lounge, including restroom. and shower
facilities for use by ~.ight crew and passengers.
10. ~ ~ , Lessee shall quit possession of the Leased premises at the
end of the Lease Term or any renewal ar extension thereof, or upon
cancellation or termination of the Lease Agreement, and deliver up the Lease
Premises to Lessor in as good condition as existed when possession was taken
by Lessee, reasonable wear and tear excepted.
11. I~si~. Lessee must indemnify, hold harmless and defend the Lessor, its officers, agents and employees, from and against liability for any and all
claims, liens, suits, demands andlor actions far damages, injuries to persons
(including death, property damage, (hacludi.ng loss of use}.,...and expenses,
including court costs, attorneys' fees and other reasonable costs, occasioned
by or incidental to the Lessee's occupancy ar use of the Leased Premises or
the Airport andlor activities conducted i.n connection with or incidental to this
Lease Agreement, including all such causes of action based on common,
AIRPOl~T LEASE AGREEMENT Jet Works -Page 9
constitutional or statutory law, or based in whole or in part upon the negligent
or intentional acts or arnissions of Lessee, its officers, agents employees,
invitees or other persons. Lessee must at all times exercise reasonable
precautions on behalf of, and be solely responsible for, the safety of its
off cers, employees, agents, customers, visitors, invitees, licensees and other
persons, as u~e11 as their property, while iz~, on, or involved in any way with
the use of the Leased Premises. The Lessor is not liable ar responsible or
the negligence or intentional ~ acts or omissions of the Lessee, its officers,
agents, employees, agents, customers, visitors and other persons. The Lessor
shall assume no responsibility or liability for harm, injury, ar any damaging
events which are directly or indirectly attributable to premise defects, whether
real or alleged, which may now exist or which may herea~er arise upon the
Leased Premises, responsibility fflr all such defects being expressly assumed
by the Lessee. The Lessee agrees that this indemnity provision applies to all claims, suits, demands, and actions arising from all premise defects or
conditions,
jl~yj'l;`YPR C~VT~;I~N _.T~ R FC~T TIRE ,F ~"EF1 '~~,.~Fr~~Y
~NT~ P_T~~TF~~T 'T~'~TF ~,F.~..E$~'(1~f T~F, C,'C~~~F,t~T 1~N~F~~ ~l~ THF,
j,F,~~ R' ~ f.~.~TT,TC7F~ ~I~F T, ,~~t~R T~~ PARTT~` AT f
rn~TNT~ T,F,A, i A YR ~ F,NT WFTF,RF~ THAT NF.~TY ,T~TFN(^;F, TS A
r nr~g,~.~,~T , A~ 1~ F, ~F TFTFI TN TT TR D , A T- H,_~~. T) AM
NnTWTTH~~~~ T~TF, TRRM ~ T~.~~.~RF~~`
~R~~ ~C17 iF.L {,~TT~TCT ~b[~E..f~F T F, T~~~,~~}R C}R ANY t~F TTY
~ T ,t~ ,F,~ ~R A YFINT~, I~TXF,T~ WiTFt THE
FAT Ti~T C~ i ANY ~TH_FR pF.~~N _QR_~t~IT TLV__
12. ~h~~~. Lessee a ees to properly store, collect and dispose of all chemicals
and chemical residues; to roperly store, confine, collect and dispose of all p
paint, including paint spray in the atmosphere, and paint products; and to
comply with a1I Local, State and Federal regulations governing the storage,
handling or disposal of such cherni.cals and paints. Furthez, the Lessee shall be
solely responsible for all discharges, whether accidental or intentional, of any
chemical and for the costs associated with the cleanup, remediatian anal
disposal of said chemicals.
13, T-~ 7 r n1~~ Ac '~vities, Should Lessee violate any law, rule, restriction or
regulation of the City of Denton or the Federal Aviation Administration, or any
other regulatory authority, or should the Lessee engage in or permit other
persons or agents to engage in activities which could produce hazards or
obstruction to air navigation, obstructions to visibility or interference with any
aircra.~ navigational aid station or device, whether airborne or on the ground,
AIR.PgRT LEASE AGREEMENT let Works -Page 10
then Lessor shall state such violation in writing and deliver written notice to Lessee or Lessee's agent on the Leased Premises, or to the persons} on the
Leased Premises who are causing said violations}, and upon delivery of such
written notice, Lessor shall have the right to demand that the persons}
responsible for the violations} cease and desist from all such activity creating
the vialation(s}. Tn such event, Lessor sha11 have the right to demand that
corrective action, as required, be con~rr~.ence~. immediately to restore the Leased
Premises n1t0 ConforlnanCe W1th the particular law, rule or aeronautical
regulation being violated. Should Lessee, Lessee's agent, or the persons}
responsible for the violation(s) fail to cease and desist from said violations}
and to immediately commence correctong the violations}, and to complete said
corrections within twenty-foux (2~} hours following written notification, then
Lessor shall have the right to enter onto the Leased Premises and correct the
violations} at the sale cost and expense of Lessee, and Lessor shall not be
responsible for any damages incurred to any irnpravernents on the Leased
Premises as a result of the corrective action process. In addition, such violation shall be considered a material default by Lessee authorizYng Lessor, at its sole
option and discretion, to irnrnediately terminate and cancel this Lease
Agreement.
C. No signs, posters, or other similar devices ("Signage"} shall be placed on
the exterior of the Lease Improvements or on any portion of the Leased Premises or Airport
property without the prior written approval of Lessor. Lessee, at its sole expense, shall be
responsible for the creation, installation and maintenance of all such Signage. Lessee sha11
pay to Lessor any and all damages, injuries, or repairs resulting from the installation,
maintenance or repair of any such Signage. Any Signage placed on the Leased Premises
shall be maintained at all times in a safe, neat, sightly and good physical condition. All
signage sball be removed from the Leased Premises by Lessee immediately upon receipt of
instructions for removal of same from Lessor, including without limitation, upon expiration or termination of this Lease Agreement, If Lessee fails to remove the Signage then
Lessor
may do so at the sole cost and expense of Lessee. Lessee sha11 be permitted the right to
place two wall signs, no greater than ~-two square feet each, identi~~ying the canimercial
hangar operation. All signage shall comply with all applicable ordinances including the
City of Denton sign ordinance."
I}. ENTRY. Lessor and its designees shall have the right to enter the Leased
Premises upon reasonable advance notice (written or oral) and at any reasonable times for
the purposes of inspecting the Leased Premises, performing any work which Lessor elects
to perform under this Lease ,Agreement, and exhibiting the Leased Premises for sale,
lease, ar mortgage. Nothing in this section shall imply any duty upon Lessor to do any
~ work, which under any .other provision of this Lease ~.gTeen~ent Lessee is rewired to
perform, and any performance by Lessor shall not constitute a waiver of Lessee's default.
AIRPORT LEASE AGREEMENT Set Wor~CS -Page 11
r
0
1
VI. ~~'F,NA~1~T~1~~" T,F~~ ~
Lessor hereby agrees as follows:
A. LF,ACF,F~ , F,N.x ~'~T, Upon an pay~.ent of all rent, fees, and performance
of the covenants and agreements on the part of Lessee to be performed hereunder, Lessee
shall peaceably hold and enjoy the Leased Premises and all rights and privileges herein
granted.
~,~N , T 1TA ~'F_ Lessor warrants and represents that in the establishment,
constraction and operation of the Airport, that Lessor has heretofore and at this thne is
complying With all existing rules, regulations, and criteria distributed by the Federal
Aviation Adm.inistratian, or any other governmental authority relating to and including, but
not limited to, noise abatement, air rights and easements aver adjoining and contiguous areas, over-flight in landing or takeoff, to the end that Lessee will not be legally
liable for
any action of trespass or similar cause of action by virh~e of any aerial operations of
adjoining property in the course of normal take-off and landing procedures from the
' ort; Lessor fi~ther warrants and represents that at all times during the Lease Term, or
any renewal or extension of same, that it Will continue to comply With the foregoing.
~PF. , AT , C~ Nl)TT t~N~
It is expressly understood and agreed by and between Lessor and Lessee that this
Lease Agreement is subject to the following special terms and conditions.
gAYIS~i~A-..~, because of the present sixty thousand ~~O,O~o} pou~.a.d continuous use weight bearing capacity of the taxiway of Lockheed, Lessee herein
agrees to limit all aeronautical activity including landing, take-off and taxiing, to a~rcra~
having an actual weight, including the weight of its fuel, of sixty thousand ~60,U0~} founds
ar less, until such dine that the runway and designated taxiways on the Airport have been
improved to handle aircraft of such excessive Weights. It is farther agreed that, based on
~uali~.ed engineering studies, the weight rest~.ctions and provisions of this clause may be
adjusted, up or down, and that Lessee agrees to abide by any such changes or revisions as
such studies may dictate. "Aeronautical activity" referred to in this clause shall include any
activity of the Lessee or its agents or subcontractors, and its customers and invitees, but
shall not include those activities over Which it has no solicitory part or control, such as an
unsolicited or unscheduled or emergency landing. A pattern of violating the provisions of
this section on two or more occasions shall be sufficient to cause the immediate termination
of this entire Lease Agreement and subj ect Lessee to liability for any damages to the Airport that might result,
AIRPQI~T LEASE AGREEMENT het Works Page 12
'f a rti
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VIII. I - - ~ FN(~T TMP'R ~IVE,M~~NT
A. RF, I~Il~: ,NT~• Before ca~nmencing the canstru.ction of any improvements
' an the Leased Premises including Lessee's h~nprovernents the "Lease hnprovements'~},
~ Lessee shall submit;
1. Documentation., specifications, or design work, to be approved b~ the Lessox,
which shall establish that the improvements to be built or constructed upon the Leased Premises are in conformance with the overall size, shape, valor, quality
and design, in appearance and structure of the program established by Lessor
on the Airport.
1 2. A11 plans and specifications showing the location upon the Leased Prer~.ses of
the proposed construction and improvements;
,
3. The estinated cost of such constru.ct~on.
No construction may commence until Lessor has approved the plans and I
specifications and the location of the Lease Improvements, and the estimated costs of such
construction. Approval by the Lessor shall not be unreasonably withheld. Documentary
evidence of the actual cost of construction on public areas only such as taxiways) shall be
delivered by Lessee to Lessor's City Manager from time to time as such costs are paid by Lessee, and Lessor's City Manager or designee is hereby authorized to endorse upon a cagy
of this Lease Agreement flied with the City Secretary of Lessor such actual amounts as he
shall have found to have been paid by Lessee, and the findings of the City Manager when
endorsed by ham upon said contract shall be conclusive upon all parties for all purposes of
this Lease Agreement.
No later than 3a days after completion of the Lease hnpravements, Lessee shall
submit to Lessor detailed as built plans of the Lease Impraven~ents and documentary
evidence acceptable to Lessor evidencing the total cost to construct the Lease hnproveznents
~"Cost to Construct Lease Improvements"}.
B. ~1_TT~NA~.~ ~C,(~N~TRZ l ,"~IC~N C~ , TMP'RC~VF~M i,~,~: Lessee is hereby
authorized to canstru.ct upon the Leased Premises, at its own cost and expense, buildings, hangars, and structures, that Lessor and Lessee mutually agree are necessary far
use in
connection with the operations authorized by this Lease Agreement, provided however,
Lessee sha11 comply with all of the requirements of Section VIII,A., above, Such additional
improvements shall be a part of the Lease Improvements.
C. ~ _ ,R ~N1P ~F 1~R.~, , NTH: Except as otherwise provided in this
Lease Agreement, the Lease Improvements constructed upon the Leased Premises by
Lessee sha11 remain the property of Lessee during the Lease Terra subject to the following
conditions, terms and provisions:
. 1, R~,ya,~ cif Rll'~ , in~~. No building or permanent fixture nay be removed
AIRPORT LEASE AGREEMENT Jet ~lorks -Page 13
from the Leased Premises.
2. As~ump~i~n. The Lease Improvements sha11 automatically become the
property of Lessar absolutely free, without ar~y cost to Lessar, at the end of the
Lease Tenn, or any extension thereof.
3, F i ~r , ~ ~~1... , ,~~ee's ,Tm~ ~veme~n The Lease Improvements shall
irr>,mediately become the property of Lessar at na cast, expense, or
Comper~satzan to Lessee shauld Lessee fail to complete the Lessee's
hnprovenaents within the Constna.ction Period as provided in Section II.D. of
. ~ this Lease Agreement.
4, n fell tic~n ~r Termin #~i~rt. Should this Lease Agreement be cancelled or
terminated before the end of the Lease Term, or extension theretif, Lessor sha11
have the right to purchase all of the Lease Improvements In the event of a
cancellation or termination, other then. due to a default by Lessee that has not
been cured as provided below, the purchase price shall be equal to the most
recent value of the Lease Improvements as determined by the Denton County
Central Appraisal District ~"Value of the Lease hnproven~en#s'~ reduced by
1/34 for each year of the Lease Term that has expired as of the date of
termination the "Purchase Price"}. Should the Denton County Central
Appraisal District not determine a separate value for the Lease Improvements,
or should such separate valuation be older than two years, then the Purchase
Price will be determined tak7ng the Cost to Construct the Lease Improvements
reduced by 1130 for each year the Lease Term has expired as of the date of
termination. If the termination or cancellation is due to a default by Lessee that has not been. cured within 30 days alder written notice of default to Lessee,
then the Purchase Price as deterznin.ed above shall be reduced by 50%.
However, if Lessee provides written notice to Lessor within said 34 day cure
period that it is impossible tocure such default within said time period, then
the Lessor may consent to an extension of such tune to cure, which consent
will not be unreasonably withheld.
j~, ~„1RR ~~TATT~IN ~1F 11~~RTCTA. C~,F,
Any person, corporation ar institution that lends money to Lessee far construction
of any hangar, structure, building ar improvement and retains a security interest in said
hangar, structure, building or Improvement shall, upon default of Lessee's obligations to
said mortgagee, have the right to enter upon the Leased Premises and operate or manage
said hangar, struucture, building ar improvement according to the terms of this Lease Agreement, for a period not to exceed the term of the mortgage with Lessee, ar
until the
loan is paid in full, whichever comes first, but in na event longer than the Lease Term. It
is expressly understood and agreed that the right of the mortgagee referred to herein is
limited and restricted to those improvements constructed with funds harrowed from
mortgagee, those improvements purchased with the borrowed funds, and those
improvements pledged to secure the refinancing of the improvements.
AIRPORT LEASE AGREEMENT let Works -Page 14
R T~~HT CAF F,NT_
Lessor shall have the right to establish easements, at no cost to Lessee, upon the
Leased Premises for the purpose of providing underground utility services to, from or
across the Airport property or far the const~ru.ctian of public facilities an the Airport.
However, any such easern~nts shall not interfere with Lessee's use of the Lease Premises
and Lessor shall restore the property to the original condition as is reasonable practicable
u on the installation of any unity services on, in, over or under any such easement at the P
conclusion of such construction. Construction in or at the easement shall be canlpleted
within a reasonable time.
A ~~TCNlV(F.NT_ ~F T , i A~~
Lessee expressly covenants that it will not assign this Lease Agreement, convey more
than fi~.y percent DSO%} of the interest in its business, through the sale of stock or otherwise,
transfer, license, nor sublet the whole or any part of the Leased Premises for any p~urrpase,
except for rental of hangar space or tie~dawn space for storage of aircra#1 only, without the
written consent of Lessor, Lessor agrees that it will not unreasonably withhold its approval
of such sale, sublease, transfer, license, or assignment of the facilities for Airport related
purposes; provided however, that no such assignment, sublease, ~ansfer, license, sale or
otherwise shall be approved. if the rental, fees or payments, received or charged are ~n excess
of the rental or fees paid by Lessee to Lesser under the terms of this lease, for such pardon
of the Leased Premises proposed to be assigned, subleased, transferred, licensed, or
otherwise. The provision of this Lease Agreement shall remain binding upon the
assignees, if any, of Lessee.
TNT ~ t~F
A. ~ A C,~: I~.egardless of the activities contemplated under this
Lease Agreement, Lessee shall maintain continuously in effect at all times during the term
of this agreement, at Lessee's sole expense, the fallowing minimum insurance coverages:
1. Commercial Public} General Liability covering the Lessee or its company, its
employees, agents, tenants and independent contactors, and its operations on the
airport. Coverage shall be in an amount not less than $1,040,000 per occurrence
and provide coverage for premisesloperations and contactual liability AND where
exposure exists, coverage for: productslcompleted operations; explosion, collapse and underground property damage,
2, All r~sl~ property insurance on a replacement cost bases covering loss or damage to
all facilities used by the Lessee, either as a part of this agreement or erected by the
Lessee subsequent to this agreement. Under no circurrrstances shad the Lessor be
liable for any damages to fixtures, merchandise ar other pexsonal property of the
Lessee or its tenants.
AIRPORT LEASE AGREEMENT Set Works -Page 15
.4
3~ Business Automobile Liability to include coverage for ~WnedJLeased Autos, Non-
G~vned Autos and Hired Cars:
For operation in aircraft movement areas the limit of liability shall be $14x,000
per occurrence.
Far other operations the limit of liability shall be consistent With the amount set
by State Law.
B. AT~T~TTT(~NAT r ~~R A TFr~: In addition to the above referenced coverages, the
following Insurance is required if the activity or exposure exists or is contemplated:
1. Aircraft FueU0i1 Storage and Dispensing Comprehensive Commercial Public}
General Liability shall include coverage or separate coverage shall be provided for
Environmental Impairment Liability.
~~t
2. Aircraft Sates or Aircraft Charter and Air Taxi Aircraft Liability in the amount of
$1,000,000 per occurrence to include Huli Coverage and Liability. fn addition,
Passenger Liability in an amount of $100,000 per person per passenger seat} shad
be provided.
3. Aircraft Rental or Flight Training- Aircraft Liability in the amount of $~1,4a4,000
per occurrence to include Hull Coverage and Liability, Passenger Liability in the
amount of $100,000 per person (per passenger seat} and StudentlRenter Liability
covering all users in the amount of $500,004 per occurrence.
4. Specialized Commercial Flying (including crop dusting, seeding, and spraying,
banner touting and aerial advertising, aerial photography and surveying, fiire
fighting, paver line or pipe line patrol} -Aircraft Liability the amount of
$1,000,000 per occurrence to include Hull Coverage and Liability, addition,
Passenger Liability in an amount of $100,000 per person (per passenger seat}
shall be provided.
5, Aircraft Storage,ll~aintenance andlor Repair -Aircraft Liability in the amount
of $1,000,000 per occurrence to incline Hull Coverage and Liability. m addition, Hanger Keepers Liability in the amount of $500,000 per occurrence
shall be provided, The requirement for Hangar Keepers Liability shall not
apply to individual ownerloperators whose primary use of the hangar space is
the storage of their own aircraft. The requirement does not apply to such
Individuals notwithstanding the i'act that they may, from time to time, permit
the storage of non-awned aircraft in the hangar space and charge a_fee for the
storage of such aircraft so long as such use is in the nature of anent-sharing
agreement rather than a commercial aircraft storage business,
C. (~_~~R A C~, RF1C~T Tilt F,MF,~: All insurance coverages shall comply With the
AIRPORT LEASE AGREEM.ENTJet Wor4cs -Page 16
following requirements:
1. A.111iability policies shall name the City of Denton, and its officers and employees
as an additional Warned insured and provide for a minimum of 3 0 days written
notice to the City of any cancellation or material change to the policy.
2. AlI insurance required by this Lease Agtee~nent must be issued by a company or
companies of sound and adequate fnancial responsibility and authorized to do
business in the State of Texas. A11 policies are subject to the examination and
approval of the City~s office of Risk Management for their adequacy as to content,
form ofprotection ar~d providing company,
3. Required insurance naming the City as an additional insured must be primary
insurance and not contributing with any other insurance available to the. City whether from a third party liability policy or other. Sa1d 11m1ts of insurance shall
m
na way limit the liability of the Lessee hereunder.
4. The Lessor shall be provided with a copy of all such policies and renewal
certificates. Failure pf Lessee to comply with the minimum specified amounts or
es of insurance as re aired by Lessor shall constitute Lessee's default of this
r; Lease Agreement.
5. During the Lease Term, or any extension thereof, Lessor herein reserves the right
to, with b0 days ~.otice, adjust or increase the liability insurance amounts required
of the Lessee, and to require any additional rider, provisions, or certificates of
insurance, and Lessee hereby agrees to provide any such insurance requirements a.s
may be required by Lessor; provided however, that any requirements shall be commensurate with insurance requirements at other public use airports similax to
the Denton N~unicipal Airport in size and in scope of aviation activities, located in
the southwestern region of the CTnited States.
`ANC ,rT,r,AT1 „N RY ~,~,~~C~
In the event that Lessee shall file a voluntary petition in bankruptcy ar
j ' proceedings in bankruptcy shall be instituted against it and Lessee thereafter is
adjudicated bar.~krupt pursuant to such proceedings, or any court shall take jurisdiction of
` Lessee and its assets pursuant to proceedings brought under the provisions of any Federal
reorganization act, or Lessee sha11 be divested of its estate herein by other operation of
law; ar Lessee sha11 fail to perform, beep and observe any of the terms, covenants, or conditions herein contained, or on its part to be performed, the Lessor may give Lessee
written notice to correct such condition or cure such default and, if any condition or
default shall continue far thirty (3O) days after the receipt of such notice by Lessee, then
Lessor may terminate this Lease Agreement by written notice to Lessee, However, if
Lessee provides written notice to Lessor within. said 30 day cure period that it is impossible
to cure such default within said time period, then the Lessor may consent to an extension of
AIRPORT LEASE AGREEMENT Jet Works -Page 17
I
such time to cure, which consent will not be unreasonably wit~iheld. In the event of
default, Lessor has the right to purchase any or all of the Lease Improvements under the
provisions of Section ~III.C.4, hereof.
XTV, ~;AN~'-F. ,T~,ATT~N_RY.~:."~F~F,
Lessee may cancel this Lease Agreement, in whole or part, and terminate all or any of
` its obligations hereunder at any time, by thirty (30) days written. notice, upon or aver the
happening of any one of the following events; (1} issuance by any court of competent juris-
diction of a pennanentinjunction in any way preventing or restraining the use of the Airport
ar any part thereof for airport purposes; the breach by Lessor of any of the covenants or
agreements contained herein and the failure of Lessor to remedy such breach far a period of ninety (90} days after receipt of a written notice of the existence of such breach;
the
inability of Lessee to use the Lease Premises and facilities can#u~uing for a longer period
than nine 90} da s due to' any law or any order, rule or regulation of any appropriate ( y
governmental authority having jurisdiction over the operations of Lessor ar due to war,
earthquake ox other casualty; ar (4) the assumption or recapture by the United States
government, or any authorized agency thereof, of the maintenance and operation of said
airport and facilities or any substantial part or parts thereof.
Upon the happening of any of the four events listed in the preceding paragraph, such
that the Leased Premises cannot be used for aviation purposes, then the Lessee may cancel
this Lease Agreement as aforesaid, or may elect to continue this Lease Agreement under its
terms, except, however, that the use of the Leased Premises sha11 not be limited to aviafiion
purposes, their use being only limited by such laws and ordinances as may be applicable at that time,
Should Lessor close the Airport and relocate the Airport to another location. during the
primary term of this Lease Agreement, Lessee shall have the right to relocate its facili~.es to
the new airport at a suitable location under the same ar similar terms of this Lease
. Agreement. The cost of relocation of Lessee's facilities will be shared by Lessor and Lessee
in proportion to the number of years remaining on the primary term of this Lease
Agreement. In this regard Lessor will be responsible for 110 of the such costs for every
year remaining on the primary term.,
X~'. l~~ . ~ . ,A~~(~T ~S PR C~~ ~T~N~
A, F~NTI~F, A ~7gF,EM~NT. Th1s Lease Agreement constitutes the entire understanding between the parties and as: of its Effective Date supersedes all prior
or
independent Agreements between the parties covering the subject utter hereof. Any
change ar modification hereof shall be in writing signed by both parties,
B. RTN~T~CT FFF~'~~`;T, All covenants, stipulations and agreements herein shall
extend to, bind and inure to the bene~.t of the legal representatives, successors and assigns
AIRPORT LEASE AGREEMENT Jet Works -Page 18
`.'r
of the respective parties hereto.
C. ~F,V~1R Rn.Tt'Y, If a provision hereof shall be finally declared void or illegal by
an court or ac~ninistrative agent having jurisdiction, the enure Lease Agreement shall not Y y
be void; but the remaining prQVisions shall continue in effect as nearly as possible 1n
accordance with the original intent of the paxties.
~I~E. Any notice given by one party to the other in connection with this
Lease Agreement shall be in writing and shall be sent by certified mail, return receipt
requested, with postage fees prepaid or via facshnile as follows:
1. If to Lessor, addressed to:
City Manager
City of Denton
215 E. NIcl~inney Street
Denton, Texas 76201
Fax No.940.~49.8596
2. if t4 Lessee, addressed to:
Chris PIoskins, President
Jet Works Aviation, Inc. 400 Gulf Stream J~oad , 9S
Fort worth, Texas 761
Phone 1817} 626-45 84
Fax No. X817} 626-1928
with copy to:
Harlan L l: ierman
Cantey & Hangar L.L.P.
Burnett Plaza, Suite 2100
r 8 01 Cheny Street, tTr~.t # 12
Fart Worth, Texas 76102-6881
Fax No. (817) 877-2807
E. The headings used in this Lease Agreement are intended far
convenience of reference only and do not define or limit the scope or meaning of any
provision of this Agreement,
F. C,►{~~~RMNC~ LAS This lease Agreement is to be construed in
accordance with the laws of the State of Texas and is fully performable in Denton County,
Texas. Exclusive venue for any lawsuit to enforce the terms or conditions of this Lease
Agreement shall be a court of competent jurisdiction in Denton County, Texas.
AIRPORT LEASE AGREEMENT Jet Works -Page ~ 9
1
J
NCB WAT~F,R. Na walver by Lessor or Lessee of any default or breach of
covenant or term of dais Lease Agreement maybe treated as a waiver of any subsequent
default or breach of the same or any other covenant or term of this Lease Agreement.
H, NCB Ate, C`Y, During all times that this Lease Agreement is ~ effect, the parties
agree that, Lessee. is and shall not be deemed an agent or employee of the Lessor..
I. FORCE IvZATEURE. None of the Parties shall be ~ default or otherwise liable
for any delay in or failure of performance under this Lease Agreement 1f such delay or
failure arises by any reason beyond their reasonable control, including any act of dad,
any acts of the common enemy or terrorism, the elements, earthquakes, floods, fires,
epidemics, riots, failures ar delay in transportation or communications. I~owever, lack of
funds shall not be deemed to be a reason beyond a Parry's reasonable control. The Parties will promptly inform and consult with each other as to any of the above causes, which
in
their judgment array or could be the cause of a delay in the performance of this Lease
Agreement.
iN WITiVESS WHEREOF, the parties have executed this Lease Agreement as of the
Effective Date first above written.
CITY OF DENTON, TEAS, LESSOR
*P
j
iJY. MICHAEL A. CO tJFF, CITY f AGER
ATTEST:
JEN~ER WALTERS, CITY SECRETARY
'I
. ~
t,
APPROVED AS TO LEGAL FORM:
HEREERT L. PROUTY, CITY ATTORNEY
~r ~ r• ~,f
BY;
AIRPORT LEASE AGREEMENT Jet Works -Page 2 D
SET ~Wa~~.S AVIAfiION? INC.
J
I l
~ ~ r Y!i/ ! 1 r
CHI~~ HOS S, PRESIDEN'T'
AIRPORT LEASE AGREEMEh1T Jet Works -Page 21
' ACKNCW.~EI~GMENTS
THE STATE ~F TEXAS § 9
COUNTY OF ]DENT(~N §
' ent was acknawled ed before m.e on the ~ 'day of G` ~ ' ~ 2~~4, by This ~nstrum g
Michael A. Conduff, City Manager of the City of Trenton, Texas, on behalf of said
municipality.
r ~ ,
i~ 1
,`~~~~ApYPU~~~G JADE E. RICHARDSON N0~`ARY PUBLIC, STATE ~F TEXAS . o; •.f o`' - Na~ary Public, State of Texas
My Commission Expires ;o~,. . y;
~''~►;~oFt;;~`'* ,~u~e 27 X005 Blillll~ ! i
ti
i
THE STATE OF TEXAS §
CCUNTY aF DENTON §
e o the ~ da of Q This instrument vas acknowledged before m n y Y
Chris Hoskins, President, Jet Works Aviation, Inc., a Texas corporation, on behalf of said
corporation.
NQTA~.'Y PUBLIC, STATE OF TEXAS
~~'~~Yp~~:, JULIECHAPMAN ~o~ ' ~ f
NOTARY PUBLIC tiN~+.,. ~,~Q r State of Texas
'~~~F,o~ Comm. Exp. 08-27-2008
AY.RPORT LEASE AGREEMENT ret Works -Page 22
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EXHIBIT 4
1 DRAFT MINUTES
2 City Council Mobility Committee
3 Tuesday, March 25, 2008
4
5
6 After determining that a quorum of the Mobility Committee of the Denton City Council was
7 present, the Chair of the Committee on the Mobility convened into an open meeting on Tuesday,
8 March 25, 2008 at 2:03 p.m. in the City Council work session room, 215 E. McKinney Street,
9 Denton, Texas.
to
11 Present: Chair Pete Kamp, Mayor Perry McNeill and Council Member Bob Montgomery
12
13 Also Present: Howard Martin, ACM Utilities
14 Jim Coulter, Director Water Wastewater Utilities
15 Mark Nelson, Transportation Director
16 John Knight, Assistant City Attorney
17 John Polster, Consultant ITS
18 Ann Forsythe, Boards and Committees Coordinator
19 Damon Ward, Business Air Center
20
21 Chair Kamp stated that with the approval of the Committee, the Closed Meeting Item
22 would be considered after Item 8 to allow the Item 2 presentation.
23
24 OPEN MEETING
25
26
27 3) Receive a report, hold a discussion and consider a recommendation to City Council
28 regarding an amendment to an aircraft maintenance facility airport lease agreement
29 between the City of Denton, Texas and Jet Works Air Center; and providing an effective
30 date.
31
32 Nelson presented stating this agreement is an amendment to an existing lease agreement with Jet
33 Works Air Center to add approximately 101,000 additional square feet to the lease. The lease
34 itself calls for 40,000 square feet of additional hangar and office space and about 20,000 square
35 feet for an additional private aircraft ramp. Initially, Jet Works indicated it believed it would
36 eventually add about 85 employees, but in the short term only 45 employees will be added. Jet
37 Works has been a key tenant at the airport assisting with marketing and promoting the airfield in
38 the community and putting it on the map both nationally and internationally. The Airport
39 Advisory Board approved the lease by a 6-0 vote.
40
41 Mayor McNeill again stated he thought there was a procedure where the City Manager could
42 approve these lease extensions. Nelson replied that since this an expansion and not an extension,
43 and because it is a real estate transaction, there is a legal requirement for approval by the City
44 Council.
45
46 Mayor McNeill moved to approve Item 3 with a second from Council Member
47 Montgomery. The motion was approved by a 3-0 vote.
48
EXHIBIT 5
1 DRAFT MINUTES
2 AIRPORT ADVISORY BOARD
3 MARCH 21, 2008
4
5 After determining that a quorum was present, the Airport Advisory Board convened for a Special
6 Called Meeting on Friday, March 21, 2008 at 10:00 a.m. in the Denton Airport Terminal
7 Building at the Denton Airport at 5000 Airport Road, Denton, Texas.
8
9 BOARD MEMBERS PRESENT: Chairman Woolfolk, Vice Chairman Dr. Smith Jim Clark,
10 Mr. Brown, Mr. Eames, and Dr. Kristoferson.
11
12 BOARD MEMBERS ABSENT: Tommy Brewer -excused absence per ill mother.
13
14 STAFF MEMBERS PRESENT: Mark Nelson, Director of Transportation, Tim Whitman,
15 Airport Manager, Julie Mullins, Administrative Assistant, Andrea Bax, Operations Coordinator.
16
17 PUBLIC PRESENT: Damon Ward, Business Air Center, Trey Bryson, Jet Works Air Center,
18 Wayne Cecil, Jet Works Air Center,
19
20 I. Grand Opening with a Ribbon Cutting Ceremony for the New Denton Airport Terminal
21 Building.
22
23 II. Consider an amendment to an aircraft maintenance facility airport lease agreement
24 between the City of Denton, Texas and Jet Works Air Center; and providing an effective
25 date.
26
27 Mark Nelson reviewed the backup material explaining that Jet Works currently has a
28 38,000 square foot hangar, shop and office facility on an 83,000 square foot lease. He
29 stated that Jet Works has expressed an interest to lease an additional 101,000 square feet
30 for the development of an expansion of the Jet Works facility. It was explained the
31 development would include approximately 43,000 square feet of new hangar, office and
32 shop facility and a new 20,000 square foot private ramp. The expansion will add
33 approximately 45 new employees to the current workforce of 115. Mr. Nelson indicated
34 that the amendment allowed for the lessee to initiate clearing and grading work prior to
3 5 final approval of the plans by the FAA, TxDOT or the City of Denton so as to facilitate
36 the construction schedule. It was noted that Jet Works has already submitted plans as
37 part of the pre-application process and a preliminary site plan is attached. Mr. Nelson
38 asked if there were any questions relating to the proposed development or lease
3 9 amendment.
40
41 Mr. Brown asked if this amendment had the same term as the existing lease. Mr. Nelson
42 confirmed that was the case, the amendment would terminate at the same time as the
43 original lease.
44
45 Mr. Woolfolk asked if there was any, additional comments or questions by the Board or
46 the Public regarding the issue.
AIRPORT ADVISORY BOARD DRAFT MINUTES
March 21, 2008
PAGE 2
1
2 Mr. Brown asked Jet Works staff what is the proposed construction schedule. Mr. Ward
3 indicated they would like to be in the facility by end of the Calendar Year or January
4 2009.
5
6 Mr. Smith asked if the proposed development was similar to the proposed expansion Jet
7 Works outlined in the original lease. Mr. Nelson confirmed that was the case as far as
8 concept and location, only this amendment calls for a larger expansion of the facility.
9
10 Mr. Smith stated that Mr. Ward has always lived up to his word and followed through
11 with all development initiatives that he has promised.
12
13 Mr. Smith made a motion to recommend approval of the Third Amendment. Bob Eames
14 seconded the motion. Motion passed unanimously 6-0.
15
16 III. Adjournment
17
18 Meeting adjourned at 11:15 AM
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008 Questions concerning this
acquisition may be directed
DEPARTMENT: Materials Management to Curt Arndt 349-8462
ACM: Jon Fortune
SUBJECT
Consider adoption of an Ordinance accepting competitive bids and awarding an annual contract
for the purchase of traffic signal poles for the City of Denton Traffic Division; providing for the
expenditure of funds therefor; and providing an effective date (Bid 3972-Annual Contract for the
Purchase of Traffic Signal Poles awarded to the lowest responsible bidder meeting specification,
Structural and Steel Products, Inc., in the annual estimated amount of $701,380).
BID INFORMATION
The traffic signal poles and accessories will be ordered as needed for Capital Improvement
Projects including the intersections of Carroll Boulevard and Oak Street and Carroll Boulevard
and Congress Street. The poles will also be used to replace damaged poles when needed.
RECOMMENDATION
Award to Structural and Steel Products, Inc. in the unit price amounts shown on Exhibit A of the
ordinance for an annual estimated amount of $701,380.
PRINCIPAL PLACE OF BUSINESS
Structural and Steel Products, Inc.
Fort Worth, TX
ESTIMATED SCHEDULE OF PROJECT
This price agreement will be in effect for a period of one year from the date of award and maybe
extended for additional one-year periods if agreed to by both parties with all pricing, terms and
conditions remaining the same.
FISCAL INFORMATION
Replacement of damaged poles will be funded account 352001.6508. Installation of new poles
relating to Capital Improvement Projects will be funded from the appropriate project account at
the time the installation occurs.
Agenda Information Sheet
April 15, 2008
Page 2
EXHIBITS
Exhibit 1: Bid Tabulation
Respectfully submitted:
. 1
Tom Shaw, C.P.M., 349-7100
Purchasing Agent
1-AIS-Bid 3972
Exhibit 1
BID # 3972
DATE: March 20, 2008
Annual Contract for Traffic Si nal Poles EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR VENDOR
Pelco Products, Structural &
Inc Steel Products,
Inc
Principle Place of Business: Edmond, OK Ft. Worth, TX
SECTION A: ZINC COATING ONLY (ITEMS 1- 51)
REPLACEMENT MAST ARM VERTICAL POLE,
1 4 EA COMBINATION 30' POLE, 17" BOLT CIRCLE, $3,980.00 $2,438.00
FORA 30-A FOOTING
2 2 EA MAST ARM 10', RIGID MOUNTED $870.00 $708.00
3 2 EA MAST ARM 15', RIGID MOUNTED $1,010.00 $708.00
4 2 EA MAST ARM 20', RIGID MOUNTED $1,350.00 $708.00
5 2 EA MAST ARM 25', RIGID MOUNTED $1,460.00 $829.00
6 2 EA MAST ARM 30', RIGID MOUNTED $2,290.00 $1,011.00
7 4 EA MAST ARM 35', RIGID MOUNTED $2,380.00 $1,222.00
8 4 EA LUMINAIRE ARM FOR REPLACEMENT POLE, $435.00 $339.00 ITEM 1 ABOVE
9 4 EA ILSN ARM FOR REPLACEMENT POLE, ITEM 1 $685.00 $897.00 ABOVE
10 4 EA BASE COVER FOR REPLACEMENT POLE, ITEM 1 $220.00 $321.00 ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
11 4 EA AND TEMPLATES FOR REPLACEMENT POLE, $390.00 $219.00
ITEM 1 ABOVE
REPLACEMENT MAST ARM VERTICAL POLE,
12 4 EA COMBINATION 30' POLE, 19" BOLT CIRCLE, $4,470.00 $3,026.00
FORA 36-A FOOTING
13 2 EA MAST ARM 35', RIGID MOUNTED $2,460.00 $1,222.00
14 2 EA MAST ARM 40', RIGID MOUNTED $3,410.00 $1,567.00
15 2 EA MAST ARM 45', RIGID MOUNTED $3,590.00 $1,996.00
16 2 EA MAST ARM 48', RIGID MOUNTED $3,650.00 $2,031.00
17 4 EA LUMINAIRE ARM FOR REPLACEMENT POLE, $435.00 $339.00
ITEM 12 ABOVE
Paae 1
v
Exhibit 1
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR VENDOR
Pelco Products, Structural &
Inc Steel Products,
Inc
Principle Place of Business: Edmond, OK Ft. Worth, TX
18 4 EA ILSN ARM FOR REPLACEMENT POLE, ITEM 12 $685.00 $897.00
ABOVE
19 4 EA BASE COVER FOR REPLACEMENT POLE, ITEM $220.00 $326.00
12 ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
20 4 EA AND TEMPLATES FOR REPLACEMENT POLE, $620.00 $329.00
ITEM 12 ABOVE
21 4 EA ALTERNATE 1 MAST ARM VERTICAL POLE No Bid $4,425.00
22 2 EA MAST ARM 10', RIGID MOUNTED No Bid $665.00
23 2 EA MAST ARM 15', RIGID MOUNTED No Bid $775.00
24 2 EA MAST ARM 20', RIGID MOUNTED No Bid $866.00
25 2 EA MAST ARM 25', RIGID MOUNTED No Bid $1,023.00
26 2 EA MAST ARM 30', RIGID MOUNTED No Bid $1,156.00
27 2 EA MAST ARM 35', RIGID MOUNTED No Bid $1,496.00
28 4 EA VERTICAL POLE LUMINAIRE SECTION FOR ITEM No Bid $1,440.00 21 ABOVE
29 4 EA ILSN ARM FOR ITEM 21 ABOVE No Bid $903.00
30 4 EA LUMINAIRE TRUSS FOR ALTERNATE POLE, ITEM No Bid $1,066.00 21 ABOVE
31 4 EA BASE COVER FOR ALTERNATE POLE, ITEM 21 No Bid $361.00 ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
32 4 EA AND TEMPLATES FOR ALTERNATE POLE, ITEM No Bid $447.00
21 ABOVE
33 8 EA STANDARD MAST ARM, VERTICAL POLE No Bid $9,341.00
34 2 EA MAST ARM 10', RIGID MOUNTED No Bid $665.00
35 2 EA MAST ARM 15', RIGID MOUNTED No Bid $775.00
36 2 EA MAST ARM 20', RIGID MOUNTED No Bid $866.00
37 2 EA MAST ARM 25', RIGID MOUNTED No Bid $1,023.00
Paae 2
v
Exhibit 1
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR VENDOR
Pelco Products, Structural &
Inc Steel Products,
Inc
Principle Place of Business: Edmond, OK Ft. Worth, TX
38 2 EA MAST ARM 30', RIGID MOUNTED No Bid $1,156.00
39 2 EA MAST ARM 35', RIGID MOUNTED No Bid $3,380.00
40 2 EA MAST ARM 40', 35' +BALANCE FOR ITEM 33 No Bid $4,408.00
ABOVE
41 2 EA MAST ARM 45', 35' +BALANCE FOR ITEM 33 No Bid $4,439.00
ABOVE
42 2 EA MAST ARM 50', 35' +BALANCE FOR ITEM 33 No Bid $4,449.00
ABOVE
43 2 EA MAST ARM 55', 35' +BALANCE FOR ITEM 33 No Bid $4,510.00
ABOVE
44 2 EA MAST ARM 60', 35' +BALANCE FOR ITEM 33 No Bid $4,548.00
ABOVE
45 2 EA MAST ARM 65', 35' +BALANCE FOR ITEM 33 No Bid $4,741.00
ABOVE
46 2 EA MAST ARM 70', 35' +BALANCE FOR ITEM 33 No Bid $4,751.00
ABOVE
47 8 EA VERTICAL POLE LUMINAIRE SECTION FOR ITEM No Bid $1,440.00
33 ABOVE
48 8 EA ILSN ARM FOR ITEM 33 ABOVE No Bid $903.00
49 8 EA LUMINAIRE TRUSS FOR STANDARD POLE, ITEM No Bid $1,066.00
33 ABOVE
50 8 EA BASE COVER FOR STANDARD POLE, ITEM 33 No Bid $554.00
ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE 51 8 EA AND TEMPLATES FOR STANDARD POLE, ITEM No Bid $851.00
33 ABOVE
SECTION B: POWDER COATING ONLY (ITEMS 52 - 102)
REPLACEMENT MAST ARM VERTICAL POLE,
52 4 EA COMBINATION 30' POLE, 17" BOLT CIRCLE, $4,490.00 $2,950.00
FORA 30-A FOOTING
53 2 EA MAST ARM 10', RIGID MOUNTED $960.00 $783.00
54 2 EA MAST ARM 15', RIGID MOUNTED $1,120.00 $783.00
55 2 EA MAST ARM 20', RIGID MOUNTED $1,410.00 $783.00
56 2 EA MAST ARM 25', RIGID MOUNTED $1,650.00 $915.00
Paae 3
v
Exhibit 1
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR VENDOR
Pelco Products, Structural &
Inc Steel Products,
Inc
Principle Place of Business: Edmond, OK Ft. Worth, TX
57 2 EA MAST ARM 30', RIGID MOUNTED $2,470.00 $1,120.00
58 4 EA MAST ARM 35', RIGID MOUNTED $2,680.00 $1,370.00
59 4 EA LUMINAIRE ARM FOR REPLACEMENT POLE, $495.00 $349.00
ITEM 52 ABOVE
60 4 EA ILSN ARM FOR REPLACEMENT POLE, ITEM 52 $745.00 $11,036.00
ABOVE
61 4 EA BASE COVER FOR REPLACEMENT POLE, ITEM $265.00 $333.00
52 ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
62 4 EA AND TEMPLATES FOR REPLACEMENT POLE, $390.00 $219.00
ITEM 52 ABOVE
REPLACEMENT MAST ARM VERTICAL POLE,
63 4 EA COMBINATION 30' POLE, 19" BOLT CIRCLE, $4,870.00 $3,639.00 FORA 36-A FOOTING
64 2 EA MAST ARM 35', RIGID MOUNTED $2,790.00 $1,370.00
65 2 EA MAST ARM 40', RIGID MOUNTED $3,820.00 $1,765.00
66 2 EA MAST ARM 45', RIGID MOUNTED $3,960.00 $2,313.00
67 2 EA MAST ARM 48', RIGID MOUNTED $4,150.00 $2,325.00
68 4 EA LUMINAIRE ARM FOR REPLACEMENT POLE, $495.00 $349.00 ITEM 63 ABOVE
69 4 EA ILSN ARM FOR REPLACEMENT POLE, ITEM 63 $745.00 $1,103.00 ABOVE
70 4 EA BASE COVER FOR REPLACEMENT POLE, ITEM $265.00 $339.00 63 ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
71 4 EA AND TEMPLATES FOR REPLACEMENT POLE, $620.00 $329.00
ITEM 63 ABOVE
72 4 EA ALTERNATE 1 MAST ARM VERTICAL POLE No Bid $5,245.00
73 2 EA MAST ARM 10', RIGID MOUNTED No Bid $726.00
74 2 EA MAST ARM 15', RIGID MOUNTED No Bid $874.00
75 2 EA MAST ARM 20', RIGID MOUNTED No Bid $998.00
Paae 4
v
Exhibit 1
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR VENDOR
Pelco Products, Structural &
Inc Steel Products,
Inc
Principle Place of Business: Edmond, OK Ft. Worth, TX
76 2 EA MAST ARM 25', RIGID MOUNTED No Bid $1,176.00
77 2 EA MAST ARM 30', RIGID MOUNTED No Bid $1,316.00
78 2 EA MAST ARM 35', RIGID MOUNTED No Bid $1,740.00
79 4 EA VERTICAL POLE LUMINAIRE SECTION FOR ITEM No Bid $1,785.00
72 ABOVE
80 4 EA ILSN ARM FOR ITEM 72 ABOVE No Bid $1,103.00
81 4 EA LUMINAIRE TRUSS FOR ALTERNATE POLE, ITEM No Bid $1,204.00
72 ABOVE
82 4 EA BASE COVER FOR ALTERNATE POLE, ITEM 72 No Bid $386.00
ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
83 4 EA AND TEMPLATES FOR ALTERNATE POLE, ITEM No Bid $447.00
72 ABOVE
84 8 EA STANDARD MAST ARM, VERTICAL POLE No Bid $11,676.00
85 2 EA MAST ARM 10', RIGID MOUNTED No Bid $726.00
86 2 EA MAST ARM 15', RIGID MOUNTED No Bid $874.00
87 2 EA MAST ARM 20', RIGID MOUNTED No Bid $998.00
88 2 EA MAST ARM 25', RIGID MOUNTED No Bid $1,176.00
89 2 EA MAST ARM 30', RIGID MOUNTED No Bid $1,316.00
90 2 EA MAST ARM 35', RIGID MOUNTED No Bid $4,283.00
91 2 EA MAST ARM 40', 35' +BALANCE FOR ITEM 84 No Bid $5,238.00 ABOVE
92 2 EA MAST ARM 45', 35' +BALANCE FOR ITEM 84 No Bid $5,280.00 ABOVE
93 2 EA MAST ARM 50', 35' +BALANCE FOR ITEM 84 No Bid $5,294.00 ABOVE
94 2 EA MAST ARM 55', 35' +BALANCE FOR ITEM 84 No Bid $5,371.00 ABOVE
95 2 EA MAST ARM 60', 35' +BALANCE FOR ITEM 84 No Bid $5,423.00 ABOVE
Paae 5
v
Exhibit 1
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR VENDOR
Pelco Products, Structural &
Inc Steel Products,
Inc
Principle Place of Business: Edmond, OK Ft. Worth, TX
96 2 EA MAST ARM 65', 35' +BALANCE FOR ITEM 84 No Bid $5,594.00 ABOVE
97 2 EA MAST ARM 70', 35' +BALANCE FOR ITEM 84 No Bid $5,608.00
ABOVE
98 8 EA VERTICAL POLE LUMINAIRE SECTION FOR ITEM No Bid $1,785.00
84 ABOVE
99 8 EA ILSN ARM FOR ITEM 84 ABOVE No Bid $1,103.00
100 8 EA LUMINAIRE TRUSS FOR STANDARD POLE, ITEM No Bid $1,204.00
84 ABOVE
101 8 EA BASE COVER FOR STANDARD POLE, ITEM 84 No Bid $648.00
ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
102 8 EA AND TEMPLATES FOR STANDARD POLE, ITEM No Bid $851.00 84 ABOVE
Shipment can be made within days from 120 91
receipt of order.
Authorized distributor by the N/A Yes
manufacturer? YES NO N/A
*Prices shall be bid F.0.6. Denton
Paae 6
v
ORDINANCE N0.
AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND AWARDING AN ANNUAL
CONTRACT FOR THE PURCHASE OF TRAFFIC SIGNAL POLES FOR THE CITY OF
DENTON TRAFFIC DIVISION; PROVIDING FOR THE EXPENDITURE OF FUNDS
THEREFOR; AND PROVIDING AN EFFECTIVE DATE (BID 3972-ANNUAL CONTRACT FOR
THE PURCHASE OF TRAFFIC SIGNAL POLES AWARDED TO THE LOWEST
RESPONSIBLE BIDDER MEETING SPECIFICATION, STRUCTURAL AND STEEL
PRODUCTS, INC., IN THE ANNUAL ESTIMATED AMOUNT OF $701,380).
WHEREAS, the City has solicited, received and tabulated competitive bids for the purchase
of necessary materials, equipment, supplies or services in accordance with the procedures of State
law and City ordinances; and
WHEREAS, the City Manager or a designated employee has reviewed and recommended that
the herein described bids are the lowest responsible bids for the materials, equipment, supplies or
services as shown in the "Bid Proposals" submitted therefor; and
WHEREAS, the City Council has provided in the City Budget for the appropriation of funds
to be used for the purchase of the materials, equipment, supplies or services approved and accepted
herein; NOW, THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The numbered items in the following numbered bids for materials, equipment,
supplies, or services, shown in the "Bid Proposals" on file in the office of the City Purchasing Agent,
are hereby accepted and approved as being the lowest responsible bids for such items:
BID ITEM
NUMBER NO VENDOR AMOUNT
3 972 1-102 Structural and Steel Products, Inc. Exhibit A
SECTION 2. By the acceptance and approval of the above numbered items of the submitted
bids, the City accepts the offer of the persons submitting the bids for such items and agrees to pur-
chase the materials, equipment, supplies or services in accordance with the terms, specifications,
standards, quantities and for the specified sums contained in the Bid Invitations, Bid Proposals, and
related documents.
SECTION 3. Should the City and the winning bidder(s) wish to enter into a formal written
agreement as a result of the acceptance, approval, and awarding of the bids, the City Manager or his
designated representative is hereby authorized to execute a written contract in accordance with the
terms, conditions, specifications, standards, quantities and specified sums contained in the Bid
Proposal and related documents and to extend that contract as determined to be advantageous to the
City of Denton.
SECTION 4. By the acceptance and approval of the above enumerated bids, the City Council
hereby authorizes the expenditure of funds therefor in the amount and in accordance with the
approved bids.
SECTION 5. This ordinance shall become effective immediately upon its passage and
approval.
PASSED AND APPROVED this day of , 2008.
PERRY R. McNEILL, MAYOR
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
BY:
APPROVED AS TO LEGAL FORM:
EDWIN M. SNYDER, CITY ATTORNEY
BY:
3-ORD-BID 3972
ExhibitA
BID # 3972
DATE: March 20, 2008
Annual Contract for Traffic Si nal Poles EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR
Structural &
Steel Products,
Inc
Principle Place of Business: Ft. Worth, TX
SECTION A: ZINC COATING ONLY (ITEMS 1- 51)
REPLACEMENT MAST ARM VERTICAL POLE,
1 4 EA COMBINATION 30' POLE, 17" BOLT CIRCLE, $2,438.00
FORA 30-A FOOTING
2 2 EA MAST ARM 10', RIGID MOUNTED $708.00
3 2 EA MAST ARM 15', RIGID MOUNTED $708.00
4 2 EA MAST ARM 20', RIGID MOUNTED $708.00
5 2 EA MAST ARM 25', RIGID MOUNTED $829.00
6 2 EA MAST ARM 30', RIGID MOUNTED $1,011.00
7 4 EA MAST ARM 35', RIGID MOUNTED $1,222.00
8 4 EA LUMINAIRE ARM FOR REPLACEMENT POLE, $339.00 ITEM 1 ABOVE
9 4 EA ILSN ARM FOR REPLACEMENT POLE, ITEM 1 $gg7.00 ABOVE
10 4 EA BASE COVER FOR REPLACEMENT POLE, ITEM 1 $321.00 ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
11 4 EA AND TEMPLATES FOR REPLACEMENT POLE, $219.00
ITEM 1 ABOVE
REPLACEMENT MAST ARM VERTICAL POLE,
12 4 EA COMBINATION 30' POLE, 19" BOLT CIRCLE, $3,026.00
FORA 36-A FOOTING
13 2 EA MAST ARM 35', RIGID MOUNTED $1,222.00
14 2 EA MAST ARM 40', RIGID MOUNTED $1,567.00
15 2 EA MAST ARM 45', RIGID MOUNTED $1,996.00
16 2 EA MAST ARM 48', RIGID MOUNTED $2,031.00
17 4 EA LUMINAIRE ARM FOR REPLACEMENT POLE, $339.00
ITEM 12 ABOVE
Paae 1
v
ExhibitA
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR
Structural &
Steel Products,
Inc
Principle Place of Business: Ft. Worth, TX
18 4 EA ILSN ARM FOR REPLACEMENT POLE, ITEM 12 $gg7.00
ABOVE
19 4 EA BASE COVER FOR REPLACEMENT POLE, ITEM $326.00
12 ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
20 4 EA AND TEMPLATES FOR REPLACEMENT POLE, $329.00
ITEM 12 ABOVE
21 4 EA ALTERNATE 1 MAST ARM VERTICAL POLE $4,425.00
22 2 EA MAST ARM 10', RIGID MOUNTED $665.00
23 2 EA MAST ARM 15', RIGID MOUNTED $775.00
24 2 EA MAST ARM 20', RIGID MOUNTED $866.00
25 2 EA MAST ARM 25', RIGID MOUNTED $1,023.00
26 2 EA MAST ARM 30', RIGID MOUNTED $1,156.00
27 2 EA MAST ARM 35', RIGID MOUNTED $1,496.00
28 4 EA VERTICAL POLE LUMINAIRE SECTION FOR ITEM $1,440.00 21 ABOVE
29 4 EA ILSN ARM FOR ITEM 21 ABOVE $903.00
30 4 EA LUMINAIRE TRUSS FOR ALTERNATE POLE, ITEM $1,066.00 21 ABOVE
31 4 EA BASE COVER FOR ALTERNATE POLE, ITEM 21 $361.00 ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
32 4 EA AND TEMPLATES FOR ALTERNATE POLE, ITEM $447.00
21 ABOVE
33 8 EA STANDARD MAST ARM, VERTICAL POLE $9,341.00
34 2 EA MAST ARM 10', RIGID MOUNTED $665.00
35 2 EA MAST ARM 15', RIGID MOUNTED $775.00
36 2 EA MAST ARM 20', RIGID MOUNTED $866.00
37 2 EA MAST ARM 25', RIGID MOUNTED $1,023.00
Paae 2
v
ExhibitA
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR
Structural &
Steel Products,
Inc
Principle Place of Business: Ft. Worth, TX
38 2 EA MAST ARM 30', RIGID MOUNTED $1,156.00
39 2 EA MAST ARM 35', RIGID MOUNTED $3,380.00
40 2 EA MAST ARM 40', 35' +BALANCE FOR ITEM 33 $4,408.00
ABOVE
41 2 EA MAST ARM 45', 35' +BALANCE FOR ITEM 33 $4,439.00
ABOVE
42 2 EA MAST ARM 50', 35' +BALANCE FOR ITEM 33 $4,449.00
ABOVE
43 2 EA MAST ARM 55', 35' +BALANCE FOR ITEM 33 $4,510.00
ABOVE
44 2 EA MAST ARM 60', 35' +BALANCE FOR ITEM 33 $4,548.00
ABOVE
45 2 EA MAST ARM 65', 35' +BALANCE FOR ITEM 33 $4,741.00
ABOVE
46 2 EA MAST ARM 70', 35' +BALANCE FOR ITEM 33 $4,751.00
ABOVE
47 8 EA VERTICAL POLE LUMINAIRE SECTION FOR ITEM $1,440.00
33 ABOVE
48 8 EA ILSN ARM FOR ITEM 33 ABOVE $903.00
49 8 EA LUMINAIRE TRUSS FOR STANDARD POLE, ITEM $1,066.00
33 ABOVE
50 8 EA BASE COVER FOR STANDARD POLE, ITEM 33 $554.00
ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE 51 8 EA AND TEMPLATES FOR STANDARD POLE, ITEM $851.00
33 ABOVE
SECTION 6: POWDER COATING ONLY (ITEMS 52 - 102)
REPLACEMENT MAST ARM VERTICAL POLE,
52 4 EA COMBINATION 30' POLE, 17" BOLT CIRCLE, $2,950.00
FORA 30-A FOOTING
53 2 EA MAST ARM 10', RIGID MOUNTED $783.00
54 2 EA MAST ARM 15', RIGID MOUNTED $783.00
55 2 EA MAST ARM 20', RIGID MOUNTED $783.00
56 2 EA MAST ARM 25', RIGID MOUNTED $915.00
Paae 3
v
ExhibitA
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR
Structural &
Steel Products,
Inc
Principle Place of Business: Ft. Worth, TX
57 2 EA MAST ARM 30', RIGID MOUNTED $1,120.00
58 4 EA MAST ARM 35', RIGID MOUNTED $1,370.00
59 4 EA LUMINAIRE ARM FOR REPLACEMENT POLE, $349.00
ITEM 52 ABOVE
60 4 EA ILSN ARM FOR REPLACEMENT POLE, ITEM 52 $11,036.00
ABOVE
61 4 EA BASE COVER FOR REPLACEMENT POLE, ITEM $333.00
52 ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
62 4 EA AND TEMPLATES FOR REPLACEMENT POLE, $219.00
ITEM 52 ABOVE
REPLACEMENT MAST ARM VERTICAL POLE,
63 4 EA COMBINATION 30' POLE, 19" BOLT CIRCLE, $3,639.00 FORA 36-A FOOTING
64 2 EA MAST ARM 35', RIGID MOUNTED $1,370.00
65 2 EA MAST ARM 40', RIGID MOUNTED $1,765.00
66 2 EA MAST ARM 45', RIGID MOUNTED $2,313.00
67 2 EA MAST ARM 48', RIGID MOUNTED $2,325.00
68 4 EA LUMINAIRE ARM FOR REPLACEMENT POLE, $349.00 ITEM 63 ABOVE
69 4 EA ILSN ARM FOR REPLACEMENT POLE, ITEM 63 $1,103.00 ABOVE
70 4 EA BASE COVER FOR REPLACEMENT POLE, ITEM $339.00 63 ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
71 4 EA AND TEMPLATES FOR REPLACEMENT POLE, $329.00
ITEM 63 ABOVE
72 4 EA ALTERNATE 1 MAST ARM VERTICAL POLE $5,245.00
73 2 EA MAST ARM 10', RIGID MOUNTED $726.00
74 2 EA MAST ARM 15', RIGID MOUNTED $874.00
75 2 EA MAST ARM 20', RIGID MOUNTED $998.00
Paae 4
v
ExhibitA
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR
Structural &
Steel Products,
Inc
Principle Place of Business: Ft. Worth, TX
76 2 EA MAST ARM 25', RIGID MOUNTED $1,176.00
77 2 EA MAST ARM 30', RIGID MOUNTED $1,316.00
78 2 EA MAST ARM 35', RIGID MOUNTED $1,740.00
79 4 EA VERTICAL POLE LUMINAIRE SECTION FOR ITEM $1,785.00
72 ABOVE
80 4 EA ILSN ARM FOR ITEM 72 ABOVE $1,103.00
81 4 EA LUMINAIRE TRUSS FOR ALTERNATE POLE, ITEM $1,204.00
72 ABOVE
82 4 EA BASE COVER FOR ALTERNATE POLE, ITEM 72 $386.00
ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
83 4 EA AND TEMPLATES FOR ALTERNATE POLE, ITEM $447.00
72 ABOVE
84 8 EA STANDARD MAST ARM, VERTICAL POLE $11,676.00
85 2 EA MAST ARM 10', RIGID MOUNTED $726.00
86 2 EA MAST ARM 15', RIGID MOUNTED $874.00
87 2 EA MAST ARM 20', RIGID MOUNTED $998.00
88 2 EA MAST ARM 25', RIGID MOUNTED $1,176.00
89 2 EA MAST ARM 30', RIGID MOUNTED $1,316.00
90 2 EA MAST ARM 35', RIGID MOUNTED $4,283.00
91 2 EA MAST ARM 40', 35' +BALANCE FOR ITEM 84 $5,238.00 ABOVE
92 2 EA MAST ARM 45', 35' +BALANCE FOR ITEM 84 $5,280.00 ABOVE
93 2 EA MAST ARM 50', 35' +BALANCE FOR ITEM 84 $5,294.00 ABOVE
94 2 EA MAST ARM 55', 35' +BALANCE FOR ITEM 84 $5,371.00 ABOVE
95 2 EA MAST ARM 60', 35' +BALANCE FOR ITEM 84 $5,423.00 ABOVE
Paae 5
v
ExhibitA
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR
Structural &
Steel Products,
Inc
Principle Place of Business: Ft. Worth, TX
96 2 EA MAST ARM 65', 35' +BALANCE FOR ITEM 84 $5,594.00 ABOVE
97 2 EA MAST ARM 70', 35' +BALANCE FOR ITEM 84 $5,608.00
ABOVE
98 8 EA VERTICAL POLE LUMINAIRE SECTION FOR ITEM $1,785.00
84 ABOVE
99 8 EA ILSN ARM FOR ITEM 84 ABOVE $1,103.00
100 8 EA LUMINAIRE TRUSS FOR STANDARD POLE, ITEM $1,204.00
84 ABOVE
101 8 EA BASE COVER FOR STANDARD POLE, ITEM 84 $648.00
ABOVE
ANCHOR BOLTS, SET OF 4 WITH HARDWARE
102 8 EA AND TEMPLATES FOR STANDARD POLE, ITEM $851.00 84 ABOVE
Shipment can be made within days from 91
receipt of order.
Authorized distributor by the Yes
manufacturer? YES NO N/A
*Prices shall be bid F.O.B. Denton
Paae 6
v
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008 Questions concerning this
acquisition may be directed
DEPARTMENT: Materials Management to Curt Arndt 349-8462
ACM: Jon Fortune
SUBJECT
Consider adoption of an Ordinance accepting competitive bids and awarding an annual contract
for the installation of roadway pavement markings for the City of Denton Traffic Division;
providing for the expenditure of funds therefor; and providing an effective date (Bid 3995-
Annual Contract for the Purchase of Roadway Pavement Markings awarded to the lowest
responsible bidder meeting specification, Striping Technology LP, in the annual estimated
amount of $140,000).
BID INFORMATION
This bid is for the supplying, preparation, installation and/or removal of pavement markings at
various locations within the city of Denton. Although no specific locations for installation are
indicated in this bid, the estimates are based upon a composite of planned roadway marking
improvements as determined by the City's Traffic Control division.
RECOMMENDATION
Award to Striping Technology LP, in the unit prices shown on Exhibit A of the Ordinance for an
annual estimated amount of $140,000.
PRINCIPAL PLACE OF BUSINESS
Striping Technology LP
Tyler, Texas
ESTIMATED SCHEDULE OF PROJECT
This price agreement will be in effect for a period of one year from the date of award and maybe
extended for additional one-year periods if agreed to by both parties with all pricing, terms and
conditions remaining the same.
FISCAL INFORMATION
Funding for the maintenance portion of this bid will come from account 352001.6516.
Installations relating to Capital Improvement Projects will be charged to the appropriate project
account when the work is performed.
Agenda Information Sheet
April 15, 2008
Page 2
EXHIBITS
Exhibit 1: Bid Tabulation
Respectfully submitted:
. 1
Tom Shaw, C.P.M., 349-7100
Purchasing Agent
1-AIS-Bid 3995
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ORDINANCE N0.
AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND AWARDING AN ANNUAL
CONTRACT FOR THE INSTALLATION OF ROADWAY PAVEMENT MARKINGS FOR THE
CITY OF DENTON TRAFFIC DIVISION; PROVIDING FOR THE EXPENDITURE OF FUNDS
THEREFOR; AND PROVIDING AN EFFECTIVE DATE (BID 3995-ANNUAL CONTRACT FOR
THE PURCHASE OF ROADWAY PAVEMENT MARKINGS AWARDED TO THE LOWEST
RESPONSIBLE BIDDER MEETING SPECIFICATION, STRIPING TECHNOLOGY LP, IN THE
ANNUAL ESTIMATED AMOUNT OF $140,000).
WHEREAS, the City has solicited, received and tabulated competitive bids for the purchase
of necessary materials, equipment, supplies or services in accordance with the procedures of State
law and City ordinances; and
WHEREAS, the City Manager or a designated employee has reviewed and recommended that
the herein described bids are the lowest responsible bids for the materials, equipment, supplies or
services as shown in the "Bid Proposals" submitted therefor; and
WHEREAS, the City Council has provided in the City Budget for the appropriation of funds
to be used for the purchase of the materials, equipment, supplies or services approved and accepted
herein; NOW, THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The numbered items in the following numbered bids for materials, equipment,
supplies, or services, shown in the "Bid Proposals" on file in the office of the City Purchasing Agent,
are hereby accepted and approved as being the lowest responsible bids for such items:
BID ITEM
NUMBER NO VENDOR AMOUNT
3 995 1-15 Striping Technology LP Exhibit A
SECTION 2. By the acceptance and approval of the above numbered items of the submitted
bids, the City accepts the offer of the persons submitting the bids for such items and agrees to pur-
chase the materials, equipment, supplies or services in accordance with the terms, specifications,
standards, quantities and for the specified sums contained in the Bid Invitations, Bid Proposals, and
related documents.
SECTION 3. Should the City and the winning bidder(s) wish to enter into a formal written
agreement as a result of the acceptance, approval, and awarding of the bids, the City Manager or his
designated representative is hereby authorized to execute a written contract in accordance with the
terms, conditions, specifications, standards, quantities and specified sums contained in the Bid
Proposal and related documents and to extend that contract as determined to be advantageous to the
City of Denton.
SECTION 4. By the acceptance and approval of the above enumerated bids, the City Council
hereby authorizes the expenditure of funds therefor in the amount and in accordance with the
approved bids.
SECTION 5. This ordinance shall become effective immediately upon its passage and
approval.
PASSED AND APPROVED this day of , 2008.
PERRY R. McNEILL, MAYOR
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
BY:
APPROVED AS TO LEGAL FORM:
EDWIN M. SNYDER, CITY ATTORNEY
BY:
3-ORD-BID 3995
BID #3995 Exhibit A
DATE: March 20, 2008 Annual Contract for Installation of Roadway Pavement Markings
EST.
ITEM ANNUAL UOM DESCRIPTION VENDOR
QTY.
Striping
Technology LP
Principle Place of Business: Tyler, TX
1 10,000 LF CENTER LINE THERMOPLASTIC*** (CONCRETE) $0.35
2 85,000 LF CENTER LINE PAINT*** $0.12
3 200,000 LF EDGE LINE PAINT $0.12
4 30,000 LF LANE LINE THERMOPLASTIC (CONCRETE) $0.35
5 3,000 LF BARRIER LINE THERMOPLASTIC (CONCRETE) $1.00
6 1,500 LF DOTTED LINE THERMOPLASTIC (CONCRETE) $1.00
7 3,500 LF STOP BAR THERMOPLASTIC $6.00
8 20 EA LEFT ARROW THERMOPLASTIC (CONCRETE) $115.00
9 20 EA RIGHT ARROW THERMOPLASTIC (CONCRETE) $115.00
10 20 EA STRAIGHT ARROW THERMOPLASTIC (CONCRETE) $115.00
11 5 EA STRAIGHT LEFT COMBO ARROW THERMOPLASTIC $250.00
(CONCRETE)
12 1,000 EA TYPE II CR -RAISED PAVEMENT MARKERS - REDIWHITE $5.00
13 6,000 EA TYPE II AA -RAISED PAVEMENT MARKERS - YELLOW/YELLOW $5.00
14 7,000 EA RAISED PAVEMENT MARKER REMOVAL $1.00
15 40,000 LF REMOVAL OF THERMOPLASTIC (4") - (CONCRETE-ASPHALT) $0.40
Installation can be performed in days from receipt of order. 14
*Prices shall be bid F.O.B. Denton ***Measured as a single linear line
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008 Questions concerning this
acquisition may be directed
DEPARTMENT: Materials Management to Keith Gabbard 349-7144
ACM: Jon Fortune
SUBJECT
Consider adoption of an Ordinance accepting competitive bids and awarding a public works
contract for the reconstruction of West Oak Street; providing for the expenditure of funds
therefor; and providing an effective date (Bid 3994-West Oak Street Reconstruction awarded to
the lowest responsible bidder meeting specification, Jagoe-Public Company, in the amount of
$729,865.75).
BID INFORMATION
This bid is for the reconstruction of West Oak Street from Fulton Street to Bonnie Brae Street.
The project includes the removal and replacement of approximately 1,846 feet of curb and gutter,
1,132 square-feet of sidewalk, milling of 19,437 square-yards of existing asphalt paving,
replacement of 19,437 square-yards of 8-inch asphalt, and support activities such as traffic
control, addition of bus stop pads, and mobilization.
RECOMMENDATION
Award to Jagoe-Public Company in the amount of $729,865.75.
PRINCIPAL PLACE OF BUSINESS
Jagoe-Public Company
Denton, TX
ESTIMATED SCHEDULE OF PROJECT
This reconstruction project is scheduled for completion within 80 days of notice to proceed, or
approximately the last week of June 2008.
FISCAL INFORMATION
This project will be funded from account 350236446.1360.40100. Requisition number 86774
has been entered in the Purchasing software system.
Agenda Information Sheet
April 15, 2008
Page 2
EXHIBITS
Exhibit 1: Bid Tabulation
Respectfully submitted:
. 1
Tom Shaw, C.P.M., 349-7100
Purchasing Agent
1-AIS-Bid 3994
BID # 3994 Exhibit 1
DATE: 03/18/08
West Oak Street Reconstruction
No. DESCRIPTION VENDOR VENDOR VENDOR VENDOR VENDOR
Austin Bridge and Sunmount Reynolds Asphalt Road, LP Jagoe-Public Co. Corporation APAC-Texas & Construction
Co.
Principle Place of Business: Irving, TX Denton, TX Justin, TX Dallas, TX Euless, TX
1 Base Bid $999,437.55 $729,865.75 $893,337.75 $969,431.75 $890,886.60
BID BOND yes yes yes yes yes
ADDENDUM 1 yes yes yes yes yes
ORDINANCE N0.
AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND AWARDING A PUBLIC WORKS
CONTRACT FOR THE RECONSTRUCTION OF WEST OAK STREET; PROVIDING FOR THE
EXPENDITURE OF FUNDS THEREFOR; AND PROVIDING AN EFFECTIVE DATE (BID
3994-WEST OAK STREET RECONSTRUCTION AWARDED TO THE LOWEST
RESPONSIBLE BIDDER MEETING SPECIFICATION, JAGOE-PUBLIC COMPANY, IN THE
AMOUNT OF $729,865.75).
WHEREAS, the City has solicited, received and tabulated competitive bids for the
construction of public works or improvements in accordance with the procedures of State law and
City ordinances; and
WHEREAS, the City Manager or a designated employee has received and recommended that
the herein described bids are the lowest responsible bids for the construction of the public works or
improvements described in the bid invitation, bid proposals and plans and specifications therein;
NOW, THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The following competitive bids for the construction of public works or
improvements, as described in the "Bid Invitations", "Bid Proposals" or plans and specifications on
file in the Office of the City's Purchasing Agent filed according to the bid number assigned hereto,
are hereby accepted and approved as being the lowest responsible bids:
BID
NUMBER CONTRACTOR AMOUNT
3994 Jagoe-Public Company $729,865.75
SECTION 2. The acceptance and approval of the above competitive bids shall not constitute
a contract between the City and the person submitting the bid for construction of such public works
or improvements herein accepted and approved, until such person shall comply with all requirements
specified in the Notice to Bidders including the timely execution of a written contract and furnishing
of performance and payment bonds, and insurance certificate after notification of the award of the
bid.
SECTION 3. The City Manager is hereby authorized to execute all necessary written
contracts for the performance of the construction of the public works or improvements in accordance
with the bids accepted and approved herein, provided that such contracts are made in accordance
with the Notice to Bidders and Bid Proposals, and documents relating thereto specifying the terms,
conditions, plans and specifications, standards, quantities and specified sums contained therein.
SECTION 4. Upon acceptance and approval of the above competitive bids and the execution
of contracts for the public works and improvements as authorized herein, the City Council hereby
authorizes the expenditure of funds in the manner and in the amount as specified in such approved
bids and authorized contracts executed pursuant thereto.
SECTION 5. This ordinance shall become effective immediately upon its passage and
approval.
PASSED AND APPROVED this the day of ,2008.
PERRY R. McNEILL, MAYOR
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
BY:
APPROVED AS TO LEGAL FORM:
EDWIN M. SNYDER, CITY ATTORNEY
BY: ~ " 3-ORD-3 94
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: Finance
ACM: Jon Fortune
SUBJECT
Consider approval of tax refunds for the following property taxes:
Name Reason Tax Amount Year
1. De Lage Landen Operational Svc DCAD Supplemental Change 2006 $67,660.58
2. SDS Apartments/Atlantic Housing DCAD Supplemental Change 2004 $63,875.54
3. SDS Apartments/Atlantic Housing DCAD Supplemental Change 2005 $35,773.36
BACKGROUND
Chapter 31.11 of the Texas Property Tax Code requires the approval of the governing body of
the taxing unit for refunds in excess of $500.00.
The first refund for consideration is attributed to operating equipment that was rendered in 2006,
but was paid twice. The building the operating equipment is housed in is owned by the Flowers
Baking Company, but the equipment is leased to Flowers from De Lage Landen Operational
Services. The personal property (operating equipment) that was taxed in 2006 was paid by both
the Flowers Baking Company and De Lage Landen Operational Services. This refund is to
reimburse De Lage Landen Operational Services for the additional payment.
The second refund for consideration is due to a tax exemption status change regarding SDS
Apartments/Atlantic Housing. Under Texas Property Tax Code, § 11.182 (Community Housing
Development Organizations), provisions are outlined for achieving exemption status for low
income housing. The company filed for a low income housing exemption status through the Denton Central Appraisal District (DCAD). After reviewing the application,
DCAD granted SDS
Apartments/Atlantic Housing a low income housing exemption status for the 2004 tax year, and
a partial exemption status for the 2005 tax year (January 1-May 15).
Currently, DCAD does not recognize SDS Apartments/Atlantic Housing as qualifying for the tax
exemption status and is not anticipated to receive a refund due to taxing exemptions in 2006 or
2007.
Agenda Information Sheet
April 15, 2008
Page 2
FISCAL INFORMATION
The tax overpayment revenue fund would be reduced by $167,309.48.
Respectfully submitted:
Bryan Langley
Director of Finance
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: Parks and Recreation
ACM: Fred Greene
SUBJECT
Consider approval of a resolution allowing La Mexicana Restaurant to be the sole participant
allowed to sell alcoholic beverages at the Cinco de Mayo Celebration on May 3, 2008, upon
certain conditions; authorizing the City Manager or his designee to execute an agreement in
conformity with this resolution; and providing for an effective date. Parks, Recreation and
Beautification Board recommended approval with a vote of (6-0).
BACKGROUND
The Cinco de Mayo Committee, made up of community volunteers and City staff, voted for the
tenth consecutive year to support the sale of alcohol at the event, and allowing La Mexicana
Restaurant to be the sole proprietor of this product. La Mexicana Restaurant will be responsible
for rental of the booth space, obtaining the temporary license, and securing the temporary permit.
The annual Cinco de Mayo Celebration event, held in Quakertown Park, is a Hispanic cultural
festival co-sponsored by the City of Denton Parks and Recreation Department. The event runs
from 10:00 a.m. - 12:00 a.m. and includes a parade, local vendors, children's activities,
entertainment, and an evening dance.
The event continues to experience growth each year through community participation and the
use of local vendors and entertainment. Last year's event hosted approximately 12,300
participants with 51 vendors and two entertainment stages. This will be the tenth year that
alcohol will be sold at this event. There have not been any security issues at the previous events.
RECOMMENDATION
Staff recommends approval of the ordinance and agreement as submitted, which is consistent
with agreements with other co-sponsored events, such as the Denton Arts & Jazz Festival.
PRIOR ACTION/REVIEW (Council, Boards, Commissions)
Parks, Recreation and Beautification Board recommended approval at their April 7, 2008
meeting, with a vote of (6-0).
FISCAL INFORMATION
None.
EXHIBITS
1. Proposed Resolution
2. Civic Center Agreement
3. Letter of Request
4. Parks, Recreation and Beautification Board Minutes of April 7, 2008
Respectfully submitted:
Emerson Vorel
Director of Parks and Recreation
Prepared By:
Y
Janie McLeod
Community Events Coordinator
:lour Documentsl~~sol~tionsl4~l~inco De Maio alcohol sd~,doc
i
RE~LUTI~N N~~
A RES~LTYDN ALL~WiN LA MEIANA RESTAURANT TD ~E THE SALE
PARTICIPANT ALLOWED TO SELL .AL~H~LIC BEVERAGES AT THE INS DE
MAYS ELEBRAT~DN DN MAID 3, ~~0$, UPON CERTAIN ~NDITI~NS;
UTH~RI~IN THE CITY ANA~rER ~ HIS DEI~NEE T~ EEUTE AN
AGREEMENT IN NFRMITY WITH THIS RES~LI~TI~N; AND PR~V~DIN~x AN
E~'~ECTIVE DATE.
WHEREAS, the pity of Denton ~"City"} is the owner of the uakertoWn Park and
through the Park and Recreations Department co-sponsors a ~nco De Mayo celebration at the
uakertoWn Park; and
WHEREAS, the consumption of a~coho~~c beverages is allowed in the uakertoWn Park
pursuant to pity of Denton bode, ~~~~32 and
WHEREAS, the City Council finds that ~t is ~n the public interest to select only one
vendor of alcoholic beverages at the inco De Maya celebration; ar~d
WI~EREAS, Valentin armona, doing business as La Mex~cana Restaurant called "La
Mexicans"~, has requested that they be the sole participant a1loWed to sell alcoholic beverages at
this year's inco De Mayo celebration on May , 2ooS; and
WI~EREAS, the Parks, Recreation, and Beautification Board has recorrimended that La
~e~eana be the sole participant allowed to sell a~cohol~e beverages at the C~nco De Mayo .
celebration; and .
WHEREAS, the City agrees With the recon~.nendation of the Parks, Recreation, grid
Beautification Board; NOW, THEREFORE,
THE ~UNIL THE CITY DF DENTDN HEREBY RESALES:
SETI~N 1. La Mexicans shall be the sole participant a1laWed to sell alcoholic
beverages at the inco De Mayo celebration on 1Vlay 3, ~00~ at the ~uakertoWn Park upon the
following conditions:
1. They shall be responsible to obtain the temporary license and
permit for, selling alcoholic beverages approved by appropriate
state agency;
They shall provide the security necessary far the sale of alcoholic
beverages; '
They shall provide general comprehensive liability insurance Pram
a responsible carrier, With the pity as an additional insured, in the
amount o#` SDO,ooo.oo;
LiquorlDrana Shop Llabll~ty in the amount of X50,000 per
occurrence for any event occurring an pity-owned Propel Where
. alcohol Wi11 be prodded or served;
i
~:10u~ Icc~mentslResoiutions14~1Cincv De N~ayo alcohol sdl.doc
~ . They agree to indemnify the pity of Denton against any liability
incident to the selling of alcoholic beverages at the ~inco De Mayo
celebration.
ETI~N 2. The City ll~anager or his designee is authorised to execute an agreement in
conformity vtb. this Resolution, which shaii be substantially in the form of the agreement
attached hereto and made part hereof by reference.
E~TI~N . This Resolution shall beeonae effective immediately upon its passage and
approval;
PA►ED AND APPROVED this the day of , 20~$.
PERRY R. N1cNEILL, ~VIAYDR
i
ATTEST;
JENNIFER ASTER, CITY E~RETARY
BY:
A,PPRDVED A T~ LErAL FORM; .
EI~~N M. NYDER, CITY ATTORNEY ~ .
~
k
Page ~ of 2
s.1~~r doc~sltr~tsl~U8lcin~co do t~tya contra~.tda~
CIVIC ~El~1TE~lUA~ERT~D` p'ARi~ AR~~I~+~NT FAR
THE CINCH DE IVIAI'~ I~ E~E~RATiI~I~
~TAT~ l7F TF.A ~
This Agreement, made this day of ~ , by and between the pity of Denton, a municipal carparation, hereinafter referri to as the "C'ITY' aad Valentin
~mona doing business as LA M~ICAI~A RETAUR.ANT called "LA NCI~IC~A"}.
- TI~EETI~;I, Chart in eons~deratian of the cavenants and agreemen-ts herein cant~aaned5
the parties hereto do mutually ague as follows: ~ -
AI.i'TYCI~E 1
ERAL
The City grants to LA NC~~+C~4A the exclrasive privilege to sell alcoholic beverages,
subject to exceptions and condirians hereinafter set forth, for the Circa De kayo celebration on May 3~ ZEDS, to be held at the ~~vic enteY~uakertown Park. Attached
hereto and made a
part hereof by is a cagy of the resolution passed by the pity vuncil of Dentan, Texas
authorising this privilege. This privilege does not extend beyond the date of the +Cinco De Mayo
celebration set far the year ZDDB~
A~tTICLE ~
SC'~PE SERVICE
LA MEXICAN. in order to exercise the privilege to sell alcaholic beverages must
perfarrn the fallowing:
A. ~ LA MEXI~ANA shall be solely responsible far the rental and payment for any booth space necessary for the sale of alcaholic beverages at the Cinco De Mayo celebration.
B. # LA MEICA.NA, shall be solely responsible to obtain any temparary license and perrn.it
necessary for the selling of alcoho~c beverages at the C~nca Lie Mayo celebration.
~C~ - LA MEXi~CANA shall be solely responsible for the obtaining and paying for any security
necessary for their sale of alcaholic beverages at the Circa ~e IVlayo ~elebra~on.
LA ~,x1~ANA's failure to do any of the above and to show proper proof of
compliance shall waive their right to exercise the privilege of selling alcoholic beverages
at the Circa De IVlaryo ~elebratian,
ARTICLE ~
L~]CAL RULES ANI~ REG[TLATI~~
~LA MEXICANA agrees to abide by alI municipal, county, state and federal laws,
ordinances, rules and regulations and specifically, without limitation, the Llenton Cirric Center
Rules and Regulations, to obtain all necessary and proper licenses, permits and authorizations,
and to comply with the requirements of any duly authori~d person acting in connection
therewith. LA I~ICANA shat! ay a1I taxes, if any, of every nature and description arising out P
of or in any rnaru~er connected with the sale of alcoholic beverages. - .
LA M~~CANA will exercic rcasonable care and due diligence in their sale of alcoholic
beverages at the Cinco De Maya Celebration.
ARTICLE 4
INDE~TY AGREEMENT
LA M.I;~ICANA shall indemnify and save and hold harmless the CITE and its c~f~cers,
agents, and employees from and against any and al! liability, claims, demands, lasses, and
expenses, including but rat li~-ited ta, court casts and reasonable attorney fees incurred by the
CIT'~, and inelud~g, without limitation, damages far bodily and personal injury, death and
property damage, resulting from the negligent acts or omissions of LA M.I~ICANA or its
officers, shareholders, agent, ar employees in the execudon~ operation, - ar performance of this Agreement,
Nothing in this Agreement shall be construed to create a liability to any person who is not
a party to this Agreement, and nothing herein shall. waive any of the parties' defenses, bath at
law or equity, to any claim, cause of action, or litigatror~ filed by anyone- not a party to this
Agreement, including the defense of governmental immunity, ~uhieh defenses are hereby
expressly reserved.
CLE
I1~[iRAN'CE
wring the performance of the Agreerne~at~ LA ME~CANA shall maintain the following Insurance with an insurance company limed to do business in the Mate of Texas by the State
Insurance Catnmission ar any successor agency that bps a rating with Best date Carriers of at
least an A- or above:
A. Comprehensive ~xeneral Liability Insurance with bodily injury limits of not less than -
far each occurrence anal rat less than 5~~,~~~ in the aggregate, and with
property damage limits of not less that $100,~~0 for each Qccurrence and not less than -
140,0(} in the agg~egate~
B~ LiquarlI'am shop Liability in the amount of $~~~,044 per occuflc~e for any event
occurring om City-owrYed grape where alcohol will be pra~ded ~or served.
Circa De Mayo ~elebt~tion Agre~ne~tt P~a~e ~
u~ ~
1 l~ 7
~]I ATI~N PR[II~TBT~'E~]
In perform%ng ~e services required hereunder, LA ME~ANA shall not discriminate against any person on the basis of race, ca~or, religion, sex, national origin or ancestry,
age, ar
-physical handicap.
ARTYC'LE 1~
PEI~~L
A. - LA E~A~A represents that it has or will secure, at its awn expense, all personnel
required to perform all the services required under this Agreement. Such personnel sha11
not be employees ar af~icers of, ar have any cantractu relations with the CITY.
ARTYLE 11
ASI~~A~~LITY
LA MEI~A~A shall not assign any interest in this Agreemen#, and shall not transfer
any interest in this Agreement ~wbether by assignment, navatian, ar otherwise} without the prior
written consent of the iTY.
~RTI~L~ 1~
~UI[~l]IFICATI~~
Iqa waiver ar modifrcatian of this Agreement or of any covenant, canditian, or iimitatxon
herein contained s~ha,11 be ~ra~id wnless in writing and duly executed by the ~parky to be charged
therewith, and na evidence of any waiver ar madification shall be offered ar received in evidence
in any praceeding arising between the parties hereto out of or a#ecting this Agreement, ar the rights ar obligations of the parties hereunder, and unless -such waiver
ar modifiratioa is in
writ~g and duly executed; and the parties further agree that the provisions ofthis section will not
be waived unless as set Earth herein.
~RTYC'L~ 13
1VIIELL~NE~U
A. The fallowing exhibits attached tc and made a part afthis Agreement: list exhibits}
Exhibit "A" Resalu~tion Iqa.
B. venue of any suit ar cause of a~tian under this Agreement shall lie exclusively in Denton
Jaunty, Texas. This Agreement shall be construed in accordance with the laws of the State of Texas,
The eap~tians of this Agreement are far infarmatiot~al purposes only, and shall not in any
way affect the substantive terms ar condi~ians of this Agreement.
~i~ce De Mayo ~elebratioa Agre~mer~t ~ Page 4
I~ HEREOF, the pity of Denton, Texas Baas caused this Ag~enaent to ~e .
executed b~ its du1~ authori City ages, gad LA ~'iEXIANA has executed this
Agreement through its du1~ authorized undersigned o~ieer on thin the da~r of
X445.
CITY DF D~NTD~, TEAS
~DRE AIV~BE~.~, CITY NIAN'A~ER
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1 DRAFT
2
3 Parks, Recreation and Beautification Board
4 Minute s
5 April 7, 2008
6 Civic Center Conference Room
7
8 Members present: Carol Brantley, Allyson Coe, Dale Conway, Reggie Heard, Ross Richardson, and 9 Jennifer Wages
10 Members absent: Jo Kuhn
11 Staff present: Emerson Vorel, Amanda Green, Bob Tickner, Janie McLeod, Jim Mays, John Whitmore,
12 Mary Aukerman and Aimee Dennis
13
14 Vice-chairman Reggie Heard called the meeting to order at 6:00 p.m.
15
16 AWARDS AND RECOGNITIONS:
17 John Whitmore had on display the actual award received from Aquatics ' i
18 ' s r/ t ' s "for the Board to review. 19
20
21 APPROVAL OF MINUTES OF MARCH 3, 2008 MEETING: Allyson made a motion to approve the
22 minutes as written, Jennifer seconded the motion and the minutes were approved with a vote of 6-0.
23
24 ACTION ITEMS:
25 Emerson clarified the role of the Park Board in acting on the requests for the sale of alcoholic
26 beverages in City parks is to offer a recommendation only, not to make sure that all of the
27 procedures have been complied with, which is what the staff and City Council will do. With that
28 explanation to the process given, Emerson introduced the first action item.
29
30 a) Sale of Alcohol at Makalani Movement Music Festival -Makalani Jones made a presentation to the
31 Board describing his event. When asked if the event was free, Mr. Jones said he is still working on
32 that detail and will let us know in the future. Mr. Jones then left the meeting. When asked for further
33 discussion or question and getting none, Reggie asked for a motion to vote on the item. 34
3 5 MOTION: Allyson made a motion to approve the sale of alcoholic beverages at the Makalani
36 Movement Music Festival in Quakertown Park. Ross seconded the motion. The motion passed with
3 7 a unanimous vote of 6-0.
38
39 b) Sale of Alcohol at Cinco de Mayo at Quakertown Park -Janie McLeod advised the Board that the
40 vendor, La Mexicana Restaurant, was able to obtain insurance coverage for the event, which was the
41 question last meeting that tabled the item. She explained that alcoholic beverages would be sold at
42 the evening dance as well as during the daytime activities, as in years past. Reggie asked for a motion
43 to vote on this item. 44
45 MOTION: Ross made a motion for a vote on the sale of alcoholic beverages at the Cinco de Mayo
46 event in Quakertown Park. Dale seconded the motion and, without further discussion, the Board
47 passed the motion with a vote of 6-0.
48
49 c) Sale of Alcohol at Denton Arts and Jazz Festival at Quakertown Park -Janie McLeod explained
50 that a new law was passed in September 2007 that an alcohol permit will not be issued to a charitable
51 event that has the alcohol donated to it, so Festival Foundation had to contract with an outside vendor.
March 2008
1 Roy Metzler's Food and Beverage was selected by the Foundation. Although the previous agreement
2 for alcoholic beverages has been 3 years at a time, it was the advice of the City's Legal Department to
3 obtain a new contract each year the event is held in case the vendor changes. Reggie asked for a
4 motion to vote on this item.
5
6 MOTION: Jennifer moved that the Board approve the sale of alcohol at the Denton Arts and Jazz
7 Festival at Quakertown Park. Carol seconded the motion and, without further discussion, the Board
8 passed the motion with a vote of 6-0.
9 10 DISCUSSION ITEMS:
11 There were no discussion items for this meeting.
12
13 DIRECTOR'S REPORT
14 PROJECT STATUS REPORT -Avondale Park -Bob said that the site is ready for the bridge which
15 should is supposed to arrive the first of next week.
16
17 Cedar Street Streetscape Project -Bob said the project was moving along well and that they anticipate
18 more concrete would be poured on the north side of the street this week. The project is still on schedule to
19 be completed in mid-May.
20 21 Lark Forest Park Playground Project -The new equipment will all ship at the same time and should
22 arrive next week.
23
24 KEEP DENTON BEA UTIFUL
25 Emerson introduced Aimee Dennis, Interim KDB Manager, to the Board. Aimee shared with the Board
26 a ~ ` r ~ ` i ''s i v Award, which includes a $155,000
27 landscape grant.
28 Director's Report -Great American Cleanup -the event was very successful this year with over 900
29 volunteers and 360,000 pounds of litter being collected. Carol made the comment that taking out the trash
30 at the Great American Cleanup was so easy and everyone was very nice and helpful.
31 32 Aimee invited all present to visit the Redbud Festival at the Civic Center on Saturday, April 12tH
33
34 ITEMS FOR UPCOMING MEETINGS:
3 5 None.
36
3 7 With no further business on the agenda, Reggie asked for a motion to adjourn. Allyson made the
3 8 motion, Jennifer seconded the motion and the meeting was adjourned at 6: 3 3 p.m.
March 2008
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: Parks and Recreation Department
ACM: Fred Greene
SUBJECT
Consider recommending approval of a resolution allowing Roy Metzler's Food and Beverage to
be the sole participant allowed to sell alcoholic beverages at the Denton Arts and Jazz Festival
April 25-27, 2008, upon certain conditions; authorizing the City Manger or his designee to
execute an agreement in conformity with this resolution; and providing for an effective date.
(The Parks, Recreation and Beautification Board recommends approval with a vote of (6-0.)
BACKGROUND
The Denton Festival Foundation, made up of community volunteers and professional staff, has
requested to sell alcohol at the Denton Arts and Jazz Festival, allowing Metzler's Food and
Beverage to be the sole proprietor of this product. Metzler's Food and Beverage will be
responsible for rental of the booth space, obtaining the temporary license, and securing the
temporary permit. The Denton Festival Foundation provides police security at the event.
The annual Denton Arts and Jazz Festival event promotes cultural enhancement and is co-
sponsored by the City of Denton Parks and Recreation Department. It is held in Quakertown
Park and includes over 1,300 professional and amateur performers, local and statewide vendors,
children's activities, art exhibits, and various entertainers. The three-day free event runs Friday,
5 p.m. to 11 p.m., Saturday, l0 a.m. to 11 p.m., and Sunday, l l a.m. to 9 p.m.
The event continues to experience growth each year through community participation and the
use of national and local vendors and entertainment. This year's event is expected to host around
200,000 participants with 240 booths and six entertainment stages.
ESTIMATED SCHEDULE OF PROJECT
The Denton Arts and Jazz Festival three-day free event runs Friday, April 25th from 5 p.m. to 11
p.m., Saturday, April 26th from 10 a.m. to 11 p.m., and Sunday, April 27th from 11 a.m. to 9 p.m.
PRIOR ACTION/REVIEW
On April 7, 2008, the Parks, Recreation and Beautification Board recommended approval of this
item with a vote of (6-0).
Agenda Information Sheet
April 15, 2008
Page 2
FISCAL INFORMATION
This action has no impact on the City's General Fund budget. All costs and revenue from this
action will be the sole responsibility of the Denton Festival Foundation.
BID INFORMATION
Not applicable
EXHIBITS
1. Resolution
2. Contract
3. Letter of Request
4. Parks, Recreation and Beautification Board Meeting Minutes of April 7, 2008
Respectfully submitted:
Emerson Vorel
Director of Parks and Recreation
Prepared By: ~ Y
Janie McLeod
Community Events Coordinator
S:I~ur Documen~slRe~oluttons1081Axt & Jazz Festival Res.doc
RES ~I~UTIIV I~,
~ RESOLUT~~N A~,L~w~N ROY ET~LER'S F~~D BEVERAGE T~ BE THE SALE
PARTICZPAI~T ALL~wED T~ SEl~I,1 AI~COH~LIC BE~VERAES AT THE DE 'T~
ARTS JA~,~ FESTIVAL APRIL ~5-27, boo, UPON CERTAIN CNDITI~~I•
a A.UTHDRI~I~~ THECITY AAER ~ HIS DESIC~~E T~ ECUTE A
AREEIVIENT IN C~~'~RITY wYTH THIS R~~LUTID~ AND PR~VIDnV FAR ASV
EFFECTIVE DATE,
WHEREAS, the City of Denton ~"City'} i the owner of the Quakertown Park and
through the City ofDenton co-sponsor the Denton Arts Jazz Festival at the akertown Park•
WHEREAS, th.e consu~.ption of alcoholic beverages is allowed in the Quakertown Park
pursuant to City of Denton Code, §2~2-~~
wI~REAS, the C1ty Council finds that it Is rn the public Interest to select onl one
~ or of alcoholic beverages at the Denton Arts ~ Jazz Festival; and
wI~EREAS, Roy ll~et~ler's Food Beverage has requested that the be sole artiei ant ~ P ~
allowed to sell alcoholic beverages at the Denton Arts Jazz Festival; and .
WHEREAS; the Parks, Recreation and Beautification Board has reconlln,ended that Roy
ll~etzler's Food Beverage be the sole park~cipant allowed to se11 alcoholic bevera es at the g
Denton Arts razz Festival; and
WHEREAS, the City agrees with the recon~mendatton of the Parks, Recreation and
Beautification Board; New, THEREFORE,
. THE C~U1~C~L ~F TIDE CITY ~F DE'T~N HEREBY RESQLVES:
SECTI~ 1. Roy ll~etzler's Food . Beverage shall be the sole participant allowed to
sell alcoholic beverages at the Denton Arts Jazz Festival on April at the
ual~ertown Park upon the following conditions;
1. They shall be responsible for rental of any booth space
necessary;
They shall be ~•esponsible to obtain the temporary. license and
- permit for selling alcoholic beverages approved b a ro riate
y Pp p state agency;
They shall provide the security necessary for the sale of alcoholic
beverages;
4, They shall provide general comprehensive liability insurance from
a responsible carrier, with the City as an additional insured, in the
amount of 500,~0~.0~.
Ong
3 ~ Agrees to ~11~.en1~1 the ltd of Denton ~a1n~ a~~ ~la~~llt
incident to the selling of alcoholic beverages at the Benton Arts
Jazz ~'esti~al. .
~T~~N The its council authorizes rescinding of the prior contract authorized
~esalution o. R2~fl7-D ~ ~ passed b~ the pity Council on April 17, ~~07. ~ .
. E~T~~ The Cif Manager or his designee is authorized to execute an agreement in .
eonfarm~ with this realution, which shall be substantially in the form of the agreement
attached hereto and made ~a part hereof b~ reference.
~CTI~I~ 4. This resolt~on shalt become effectl~e ~named~ately upon its passage and
approval,
PAEI] Ah1D APPR~~I] this the dad of ~~OS.
~ERR~ R. ~IcII~L, ~.AY~~
.ATT~'T:
JE~E~ wALT~R, CITY ECETARY
BY:
APp~~VED A T~ ~,EA~ F~R1Vi:~
EDWIN M, DER, CT~'Y ATT~RN~Y
BY:
c:ldocume~~lslclemmoll~cals~llternplxpgrpw~selarts and jaz~.festival contractdnc
IVI E~1TEIt AIi.EEMEN~T NTH
~~Y ET~.LE~' E~OII ~EVE~AE
STATE OF TEAS ~ .
COUNTY DENT~~ §
This Agreement, made this ~ day of _ , 20aS, and between the
City of Denton, a m~n~clpal corporation, hereiner referred to as the "CITY" and Ray.
1Vletzler's Faad Beverages hereina~er referred to as "NiET~LER'
wITNEETI~, that in consideration of the covenants and agreerrients herein captained,
the parties hereto da mutually agree as follows:
ARTICLE
GENERAL
The pity grants to II~T~L~R'S the exclusive privilege to sell alcohalic beverage,
subject to the exceptions and canditians herei~aer set forth, far the Der~tan Ards and Jazz
Festival celebration an April ~5-~7, ~40~, to be held at the ua~ertovvn Parr. Attached hereto
and made a part hereof by is a copy of the resolution passed by the pity Cou~nci~ of Denton,
Texas authorizing this privilege.
ART~~LE 2
C~EE ~F ERVIE
ET~LER' S in artier to exercise the privilege to sell alcoholic beverages must perform
the fallaw~ng:
A. ET~LER' shall be safely responsible far the rental and payment fvr any booth space
necessary far the sale of alcoholic beverages at the Denton Arts and Jazz ~`estival.
B. ET~LER' S shall be solely responsible to obtain any temporary license and permit
necessary far the. selling of alcoholic beverages at the Denton Arts and Jazz Festival.
1VIET~LER' shall be sa1e1~ responsible for the abtain.ing and paying far any securit~i
necessary far their sale of alcohalic beverages t the Denton Arts and Jazz Festival.
11~ET~LER' failure to da any of the above and to show proper proof of compliance ha~~
waive their right to exercise the privilege of selling alcohalic beverages at the Denton
Arts and Jazz Festival.
_ „ > • ~ i~"~' hC~la~iel-r ~ ~ 'x.~:..,~.5 _:_~c~r~~~.czi:..~_s_ L:i+4a~~3;'.aC~~;'~~7~.s.:~.w .a,iri: 'lu. ~-i`' aa~:aA{61~3ea`i` ~~+r
ARTYL~
L~~AL RULES AND R~ULATI~N
ET~LER} agrees to abide by all n~uniclpal, county, state ar~d federal ordinances,
rules and regulations and specifically, without limitation, the Denton Civic Center Rules and
Regulations, to obtain all necessary ar~d proper Licenses, permits and authorisations, and to
comply v~ith~ the requirements of any duly authorized pexson acting in connection thereth.
1Vi~TLER' shall pay all taxes, if any, of every nature and description. arising out of or ~ any
manner connected with the sale of alcoholic beverages.
ET~LER' will exercise xeasonable care axed due diligence in their sale of alcoholic
. ~ beverages at the Benton Arts a~.d Ja~~ Festival.
A1~T~L~ ~
I~DENII~TY ARE~ENT
NI~T~LL~R' shall indemnify and save and hold harmless the CITY and its officers,
agents, and employees from and against any and all liability, claims, demands, lasses, and - .
expenses, including but not limited to, court casts and reasonable attorney fees incurred by the
CITY, and including, without limitation, damages for bodily and personal injury, death and
property darn.age, resulting Pram the negligent ~ acts or omissions of 1VIT~L~R' ~ ar its officers,
shareholders, agents, or ernplayees the execution, apera~tion, or performance of this
Agreement. .
Nothing in this Agreement shall be construed to create a liability to any person who is not
a party to this Agreement, and nothing herein shall waive any of the parties' defenses, both at
law or equity, to any claim, cause of action,. ox litigation filed by anyone not a party to this
Agreerrient, including the defense of avernental immunity, which defenses are hereby
expressly reserved. .
~RTIL~ ~
I~T~RA~E
During the performance of the Agreement, l1~ET~LER' S shall maintain the following insurance with a~. insurance company licensed to do business in the State of Teas by the
State
Insurance Camn~issian or any successor agency that has a rating with Best Rate Carriers of at
least an. A- or above:
A. Con~pxehensive general Liability Iu.surance with bodily injury Iimit of not less ,than
~~,4U~ far each occurrence and not less than in the aggregate, and with
property damage limits of not less that 1 ~~,a~0 for each occurrence and not less than
1 ~~,O~a 1n the aggregate.
M~T~L~R' S shall fur~a~sh ~nsuxance cef~ctes ox insurance pal~cles at the CITY' S
request to evidence such coverages. The insurance policies shalt name the CITY as an
additional insured an all such. policies, anal shall contain a prav~s~on that such insurance
Denta~ Arts and Ja2~ Festival Celebration Agreement -Page ~
w h ~ . ~.~.o:r,~.~~ ..,..n°~a:r.wsn-r~.~.r~•r....w~.,rdaA:a,'i~:~•..~:rr-.aS ~.i=l~v =::.Y9r#:~:.,tiy%+.~ti~~~-1.E.;a'r..'cibi.%u:,is7cL~"~:c:.'i:c~i~'d5ab:d~;ts~;
:~:.a,,: ti,.ot 4rd.KkS1eG;_Coi2~sa'iF ,c~~,
shall not be canceled or modified without written notice to the CITY and 11T~L~'
In such event ET~L~R' shall, prior to the effective date of the change or
cancellation serve substitute policies furnishing the same coverage.
AI~TII~~
~I~TII~
All notices, ~co~nunications, and reports required or permitted under this Agreement
shall be rsonall delivered or nulled tv the respective parties by depo~itrng sane in the United ~ .
Mates mail to the address shown below, certified mail, return receipt requested, unless othelw~e
s~ ecilied herein. wiled notices shall be deemed commun1cated as of three ~3} days' mailing: p
~Y NT~L~R' B~~~RA~ IT ~F ENT~N:
Bvx 1 pity N~anager.
Denton, Texas 7G~~1 MI5 E. ~ci~lnney .
~9~0} 59t-1~5~ Denton, Texas 7G~~1
All notices shall be deemed effective upon receipt by the party to wh~rn such notice is
given, or within three ~3~ days' mailing.
ARTILY 7 ~ .
NTIR~ AI~R~1V~E~'I'
This A eernent, consisting of Five ~5} pages and exhibits, constitutes the
complete and Final expression of the agreement of the parties, and is intended as a complete and
exclusive statement of the terms of their agreements, and supersedes all prior contemporaneous
offers, prorrilSes, representations, negotiations, discussions, communications, and agreements
which may have been made in connection with the subject matter hereof.
. ATILE 8
~vE~.AB~LITY .
If provision of this Agreement is ~'vund ar deemed by a cau~t of competent
'urisdictian to be invalid yr unenforceable, it shad be considered severable from the remainder of
this Agreement and shall not cause the remainder to be invalid or unenfarceab-lea In such evert, the parties shall reform this Agreement to replace such stricken provision
with a valid' and
enforceable provision which comes as close s possible to expressing the intention afthe stricken
prov~s~on.
Denton Arts and Jazz Fest~v~l Celebration Ag~~ement ~ Pale
w....: t. . , ; . ~ . 4 u . wrLC.rack..~.-::,i5•hu~.',•.z.,l+«v~oa-.o....~.-.- - - - -
AI~TILE 9
DI~R.II~ATI~N ~R~HIBITED
In erform~n the services re aired hereunder, M~T~LER' shall not discriminate ~ ~
against any person an the basis of race, color, religion, sex, national origin or ancestry, age, or
physical handicap.
ARTICLE 14
~E~ ~I~NEL
NT~LER} represents that it has or will secure, at its own expense, a~I personnel
re aired to erfor all the services re aired under this Agreement. such personnel shall not be ~ ~ ~
employees or officers of, or have any contractual relations with the rTY,
ARTICLE 11
ASI~ABILIT~
~T~L~R' shall not assign any interest in this Agreerrient, and shall not transfer any
rest in this ~ een~ent whether b assi ent, novation, or otherwise} without the p~.or ante gr { y ~
written consent of the ITY~.
ARTICLE I~
tVi~~]IEIATI~N
Igo waiver or modification of this ~ Agreerent or of any co~renant, condition, or limitation .
herein ~ contained shall be valid unless in writing and duly executed by the party to be charged
therewith and no evidence of ~.ny waiver or ~.odication sha11 be offered or received in evidence
in any proceeding arising between the parties hereto out of or affecting this Agreement, ar the
rights ar obligations of the parties hereunder, and unless such waiver or n~ochfication 1s ~in
writing and duly executed; and the parties further agree that the provisions of this section will not
be waived unless as set forth. herein,
~RTILE I3
1VIIELLAI~E~U
A. The following exhibits are attached to and made a part of this Agreement:
exhibit "A" Resolution No. .
Venue of any suit ar cause of action under this Agreement shall lie exclusively iri i]enton
~ounty, Teas. This Agreerrient shall be construed accordance with the laws of the
state of Teas.
The captions of this Agreement are for informational purposes only, and shall not in any
way affect the substantive tuns ar conditions of this Agreement.
Denta~ Arts aid Jazz Festival ~elebratian A~eernent -Page 4
.
. ~ fi x., _ M1 ~ , . ~~wx-,ukas.~..P.~.r~v~ ' 7.R-:w~ .~~w•-..•..-.~c,..tite~D?r
R~OF, icy of D~~~o~, T~ ca~s~ ~.s ee~.~~ ~ ~c~~ y ~ u~y eager, RAY F
his e~u~d .re~~en~ ~r~~ ~~y a~~b~~.~ d;~. o~ce~ on ~
of ~ ~Q.
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B
Icon ~ end Fes~va~ 1~~-~ti~~ re~n~ `age
i= -y."~JAIfN.i~s3~ .k t"~ .yva`_.twtioY#~~ti '~ia'litvyFiw :M"[ T~ ~s ~ e+`v-.._.,'. - '.~~~~~r
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D E N T ~ h7
F~ S T I V' A L
Max~~a 2b, 20p8
DE~'~'(]~d PARKS dt. RECRF,.,~A,~(J~ BARD
And CITY C~LJNC~I.
D~'~'~N ARTS & JATZ FESI`~VA.C,
Sale of alcohol. (B~ex ~c Wxue~
beat Mernbezs, .
1".he DenRon Festival Fot3a~dataon~, ~z~c. is requesting that our contract be
xesciur~~d ar~d ~uesr the City of D~~ntoz~ do likewise. Be~suse of a recent
~'.A~C n~ing, r~xe at~aua~ D~xan, A~zts & Jazz Festival is requesting
permission ~d approval for Rny Metzler, owner of Metzler's Food az~td
Sever~ge, to seal beer au~d wine at tk~e event ~o~r t~t%s yeas - 2008. 'the festival
is held on the last week~d of April each year. The festival dates far 2~8
are .~9~~'~1 ~S, ~6 & 27.
Th~.tilc you for your su~pa~[t.
Sincerely,
Ca~o~ Short, Executive Director
Dez~toz~ festival ~'oundat~on
P.O. Box 2 i 04 + Der~an, Texas 76242 ~ (~40) 565-493 ~
fax {94{x) 5bG-?Qp7 • www.de~tionjau.~`est.com
1 DRAFT
2
3 Parks, Recreation and Beautification Board
4 Minute s
5 April 7, 2008
6 Civic Center Conference Room
7
8 Members present: Carol Brantley, Allyson Coe, Dale Conway, Reggie Heard, Ross Richardson, and 9 Jennifer Wages
10 Members absent: Jo Kuhn
11 Staff present: Emerson Vorel, Amanda Green, Bob Tickner, Janie McLeod, Jim Mays, John Whitmore,
12 Mary Aukerman and Aimee Dennis
13
14 Vice-chairman Reggie Heard called the meeting to order at 6:00 p.m.
15
16 AWARDS AND RECOGNITIONS:
17 John Whitmore had on display the actual award received from Aquatics ' i
18 ' s r/ t ' s "for the Board to review. 19
20
21 APPROVAL OF MINUTES OF MARCH 3, 2008 MEETING: Allyson made a motion to approve the
22 minutes as written, Jennifer seconded the motion and the minutes were approved with a vote of 6-0.
23
24 ACTION ITEMS:
25 Emerson clarified the role of the Park Board in acting on the requests for the sale of alcoholic
26 beverages in City parks is to offer a recommendation only, not to make sure that all of the
27 procedures have been complied with, which is what the staff and City Council will do. With that
28 explanation to the process given, Emerson introduced the first action item.
29
30 a) Sale of Alcohol at Makalani Movement Music Festival -Makalani Jones made a presentation to the
31 Board describing his event. When asked if the event was free, Mr. Jones said he is still working on
32 that detail and will let us know in the future. Mr. Jones then left the meeting. When asked for further
33 discussion or question and getting none, Reggie asked for a motion to vote on the item. 34
3 5 MOTION: Allyson made a motion to approve the sale of alcoholic beverages at the Makalani
36 Movement Music Festival in Quakertown Park. Ross seconded the motion. The motion passed with
3 7 a unanimous vote of 6-0.
38
39 b) Sale of Alcohol at Cinco de Mayo at Quakertown Park -Janie McLeod advised the Board that the
40 vendor, La Mexicana Restaurant, was able to obtain insurance coverage for the event, which was the
41 question last meeting that tabled the item. She explained that alcoholic beverages would be sold at
42 the evening dance as well as during the daytime activities, as in years past. Reggie asked for a motion
43 to vote on this item. 44
45 MOTION: Ross made a motion for a vote on the sale of alcoholic beverages at the Cinco de Mayo
46 event in Quakertown Park. Dale seconded the motion and, without further discussion, the Board
47 passed the motion with a vote of 6-0.
48
49 c) Sale of Alcohol at Denton Arts and Jazz Festival at Quakertown Park -Janie McLeod explained
50 that a new law was passed in September 2007 that an alcohol permit will not be issued to a charitable
51 event that has the alcohol donated to it, so Festival Foundation had to contract with an outside vendor.
March 2008
1 Roy Metzler's Food and Beverage was selected by the Foundation. Although the previous agreement
2 for alcoholic beverages has been 3 years at a time, it was the advice of the City's Legal Department to
3 obtain a new contract each year the event is held in case the vendor changes. Reggie asked for a
4 motion to vote on this item.
5
6 MOTION: Jennifer moved that the Board approve the sale of alcohol at the Denton Arts and Jazz
7 Festival at Quakertown Park. Carol seconded the motion and, without further discussion, the Board
8 passed the motion with a vote of 6-0.
9 10 DISCUSSION ITEMS:
11 There were no discussion items for this meeting.
12
13 DIRECTOR'S REPORT
14 PROJECT STATUS REPORT -Avondale Park -Bob said that the site is ready for the bridge which
15 should is supposed to arrive the first of next week.
16
17 Cedar Street Streetscape Project -Bob said the project was moving along well and that they anticipate
18 more concrete would be poured on the north side of the street this week. The project is still on schedule to
19 be completed in mid-May.
20 21 Lark Forest Park Playground Project -The new equipment will all ship at the same time and should
22 arrive next week.
23
24 KEEP DENTON BEA UTIFUL
25 Emerson introduced Aimee Dennis, Interim KDB Manager, to the Board. Aimee shared with the Board
26 a ~ ` r ~ ` i ''s i v Award, which includes a $155,000
27 landscape grant.
28 Director's Report -Great American Cleanup -the event was very successful this year with over 900
29 volunteers and 360,000 pounds of litter being collected. Carol made the comment that taking out the trash
30 at the Great American Cleanup was so easy and everyone was very nice and helpful.
31 32 Aimee invited all present to visit the Redbud Festival at the Civic Center on Saturday, April 12tH
33
34 ITEMS FOR UPCOMING MEETINGS:
3 5 None.
36
3 7 With no further business on the agenda, Reggie asked for a motion to adjourn. Allyson made the
3 8 motion, Jennifer seconded the motion and the meeting was adjourned at 6: 3 3 p.m.
March 2008
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008 Questions concerning this
acquisition may be directed
DEPARTMENT: Materials Management to Phil Williams 349-8487
ACM: Jon Fortune
SUBJECT
Consider adoption of an Ordinance of the City Council repealing Ordinance No. 2008-057;
awarding a purchase for primary and secondary insulated electric distribution cables for the City
of Denton, Texas (Denton Municipal Electric); providing for the expenditure of funds therefor;
and providing an effective date (File No.3623-Interlocal Agreement for Purchase of Primary and
Secondary Insulated Electric Distribution Cables with the Lower Colorado River Authority
(LCRA) awarded to Techline, Inc., in the estimated amount of $2,205,840). The Public Utilities
Board recommends approval
FILE INFORMATION
This purchase is for insulated copper and aluminum electric distribution cables that Denton
Municipal Electric (DME) uses to provide and distribute primary and secondary underground
electrical service. Primary cables are insulated for 15kV and secondary cables are insulated for
600 volts. The quantities are based upon current on hand inventory, future needs, and upcoming
projects. These items are carried in the Warehouse working capital inventory.
LCRA contract pricing fluctuates based upon the raw metals market, and exact pricing will be
determined on the day of order placement. Actual prices may increase or decrease slightly
dependent upon the market prices the day of order. LCRA contract pricing through Techline,
Inc. is cost plus five percent.
PRIOR ACTION/VIEW (COUNCIL, BOARDS, COMMISSIONS)
City Council approved the Interlocal Agreement with LCRA on December 12, 2006 (Ordinance
2006-334).
City Council awarded Bid 3941 for the single purchase of distribution cables on March 4, 2008
to Techline, Inc. The vendor notified the City that they are unable to hold the original bid prices
due to rising copper costs which increased 20% from the bid opening to Council award. This
new purchase and ordinance would make the original Ordinance 2008-057, null and void.
The Public Utilities Board approved a change order to Bid 3941 at its March 24, 2008 meeting,
adjusting the original bid prices to mirror the LCRA pricing. The change order amount approved
was approximately $245,000 over the original bid prices.
The Public Utilities Board will consider this item at its April 14, 2008 meeting.
Agenda Information Sheet
April 15, 2008
Page 2
RECOMMENDATION
Award to Techline, Inc. in the estimated amount of $2,205,840.
PRINCIPAL PLACE OF BUSINESS
Techline, Inc.
Fort Worth, TX
ESTIMATED SCHEDULE OF PROJECT
The estimated delivery is 28-60 days after receipt of order.
FISCAL INFORMATION
These items will be funded out of the Warehouse working capital account and charged back to
the using department expenditure budget account or project number.
EXIBITS
Exhibit 1-Quote from Techline, Inc.
Exhibit lA - Tabulation Sheet
Respectfully submitted:
. 1
Tom Shaw, C.P.M., 349-7100
Purchasing Agent
1-AIS-File 3623
Exhibit 1
Techli~e, Inc. 4~1lOQ$
In le Purchase for ~le~tri~ IDitribu#io~ Cabies LCR~1I~riclr~
COD ~ I~CRA
Na, Wa«hause # Descripti~r~ ~ Pricin
~ 280-80-~ ~ ~ Cable, X50 CIS ~PI~ Prima 78,a~4ft ~~4.80
~a 2$0-8a-~ ~0 Calale, 750 C~ EPR Prima 75,QQQi#
~ ~~~-BO-SOD Cable, 5oa CU EPA Primary ~7,50Qft $10.7 ~8Q-8~-~ 00 Calale, 5Q0 ClJ EPIC Primary 17,5QOft 0.92
280-80-D55 Cable, AL ~~0 ~ PW Primary ~30,OOO~f $2,34
X80-Sa*D55 Cable, AL ~4~0 'IPH Prima ~30,QOOf# $2.52
d ~80~~0-01 D Cable, A~ 1 PIS Pima ~~,~O~i't $1.55
4a 280-80-01Q Cable, A~ 1PH Prima ~O,OOOft 1,~6
~ 280-BQ~a~D Gable, A~ 3PH Prima 20,DO~ft $4.7~ 5a 28D-80-~~4Q fable, A~~~ 3PH Primp ~O,~a~~ $S.Q~
0 2BD-3b~~30 Iel an ~ 0,080f# X2.57
7 28a-8D-060 weetbiriar 54,ODOft 1.4Q
8 28D-SD-0~0 Ca~verse 3,OOQ~t $ ~ . ~ ~
9 28D-24-34o Cable, ADO Cu GDQV XLP 4,aaaf~ X8.88 ~ 0 ~~0-~5-224 Cable, X50 CU GDOV XLP 4,DOOft 4,~8
~ ~ 28024-3Q~ Cable, 4I4 CU 6D01~ ~LI~ ~,~O~~t X3.85
280-15-220 1Nir~, 4~0 ~BCU ~ ~ qtr 3D,QQ~ft $3. ~ 9
~ ~ 280-24-28~ ~ Cable, 21Q CU GOaV ELI' 2,OODft X2.41
14 280~2a~~5a Cable, ClJ SaaV ~C~.P 9,008~t $x.25
~5 280.85-0~ Q Cia#lin ~4,~04ft X4.34
i
EXHIBIT 1A TABULATION
FILE 3623 - PURCHASE OF ELECTRIC DISTRIBUTION CABLES THROUGH LCRA
Techline
No. COD # DESCRIPTION QTY IN FT LCRA Total
Pricing
1 280-80-110 Cable, 750 Cu 6,000 $ 14.80 $ 88,800.00 2, 000 ft minimum reel lengths
1a 280-80-110 Cable, 750 C 72,000 $ 15.42 $ 1,110,240.00
Cut to length footages
Cable, 500 Cu 2 500 ft minimum reel 2 280-80-100 lengths $ 10.47 $ -
2a 280-80-100 Cable, 500 Cu, 17,500 $ 10.92 $ 191,100.00 Cut to length footages
Cable AL 4101-Phase, Primary 113
3 280-80-055 Reduced 4,000ft min. reel lengths $ 2.34 $ -
Cable, AL 4101-Phase, Primary, 113 3a 280-80-055 Reduced Cut to length footages 130,000 $ 2.52 $ 327,600.00
Cable, AL #21-Phase, Primary, 4 280-80-010 6, OOOft minimum reel lengths $ 1.65 $ -
4a 280-80-010 Cable, AL #21-Phase, Primary 60,000 $ 1.76 $ 105,600.00 Cut to length footages
5 280-80-040 Cable, AL #2 3-Phase, Primary 2,500 $ 4.73 $ 11,825.00 2, 500ft minimum reel lengths
5a 280-80-040 Cable, AL #2 3-Phase, Primary 17,500 $ 5.07 $ 88,725.00
Cut to length footages Cable, 350 AL-350 AL-410 AL, BOON
6 280-35-230 XLP, 37,37,19 Strand (Wesleyan) 10,000 $ 2.57 $ 25,700.00
7 280-80-060 Cable, 4/0-4I0-210 AL, BOON XLP, 19 54,000 $ 1.49 $ 80,460.00 Strand (Sweetbriar)
8 280-80-070 Cable, 210-2/0-#1 AL, BOON XLP, 19 3,000 $ 1.10 $ 3,300.00
Strand (Converse)
Cable, 500 Cu., BOON XLP, 37 Strand
9 280-24-340 1,000 ft minimum reel lengths 4,000 $ 8.88 $ 35,520.00
Cable, 250 Cu., BOON XLP, 37 Strand
10 280-35-220 (Hofstra) 1,000 ft minimum reel 4,000 $ 4.58 $ 18,320.00
lengths
Cable, 4/0 Cu., BOON XLP, 19 Strand
11 280-24-300 1,000 ft minimum reel lengths 4,000 $ 3.85 $ 15,400.00
Wire, 4I0 Soft Drawn Bare Copper,
12 280-16-220 19 Strand (Nehring) 30,000 $ 3.19 $ 95,700.00
1, 500 ft minimum reel lengths
Cable, 2/0 Cu., BOON XLP, 19 Strand
13 280-24-280 1,000 ft minimum reel lengths 2,000 $ 2.47 $ 4,940.00
Cable, #2 Cu., BOON XLP, 7 Strand
14 280-24-260 1,000 ft minimum reel lengths 1,000 $ 1.25 $ 1,250.00
Cable, #6 AL Duplex BOON 7 Strand
15 280-35-010 XLP, (Claflin) 4,000 $ 0.34 $ 1,360.00
4, 000 ft minimum reel lengths
GRAND TOTAL $ 2,205,840.00
r:\april 2008 agendas\april 15, 2008 agenda~backupl3i file 3623 purchase of cable through Icra-p~3-ord-file 3623 revised.doc
ORDINANCE N0.2008-
AN ORDINANCE OF THE CITY COUNCIL REPEALING ORDINANCE N0. 2008-057;
AWARDING A PURCHASE FOR PRIMARY AND SECONDARY INSULATED ELECTRIC
DISTRIBUTION CABLES FOR THE CITY OF DENTON, TEXAS (DENTON MUNICIPAL
ELECTRIC); PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFOR; AND
PROVIDING AN EFFECTIVE DATE (FILE No. 3623-INTERLOCAL AGREEMENT FOR
PURCHASE OF PRIMARY AND SECONDARY INSULATED ELECTRIC DISTRIBUTION
CABLES WITH THE LOWER COLORADO RIVER AUTHORITY (LCRA) AWARDED TO
TECHLINE, INC., IN THE ESTIMATED AMOUNT OF $2,205,840).
WHEREAS, on March 4, 2008 the City Council adopted Ordinance No. 2008-057
accepting and approving, inter alia, the bid of Techline, Inc. (Bid No. 3941) as being the lowest
responsible bid; and
WHEREAS, due to circumstances beyond the control of Techline, Inc. and City,
Techline,Inc. is unable to comply with the terms of the said bid award and supply the specified
primary and secondary electric distribution cables at the prices bid; and
WHEREAS, on December 12, 2006 the City Council adopted Ordinance No. 2006-334
accepting competitive bids by way of an "Interlocal Cooperative Purchasing Program
Participation Agreement" (the "Agreement") with the Lower Colorado River Authority (LCRA)
under Section 271.102 of the Texas Local Government Code for the purchase of the specified
electric distribution cables; and
WHEREAS, Techline, Inc. pursuant to the said Interlocal Cooperative Purchasing
Program Participation Agreement with LCRA is to supply the specified electric distribution
cables at the prices bid; and
WHEREAS, the City Council has provided in the City budget for the appropriation of
funds to be used for the purchase of the materials, equipment, supplies or services approved and
accepted herein; NOW, THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The recitations stated in the preamble of this Ordinance are incorporated by
reference as a part of this Ordinance.
r:\april 2008 agendas\april 15, 2008 agenda~backupl3i file 3623 purchase of cable through Icra-p~3-ord-file 3623 revised.doc
SECTION 2. Section 1 of Ordinance 2008-057, is hereby repealed.
SECTION 3. The City Manager, or his designee is hereby authorized to purchase
electric distribution cables in the estimated amount of $2,205,840 from Techline, Inc. under
competitive bids received by the Lower Colorado River Authority in accordance with an
"Interlocal Cooperative Purchasing Program Participation Agreement" under Section 271.102 of
the Texas Local Government Code, which Agreement is on file in the office of the Purchasing
Agent.
SECTION 4. The City Manager, or his designee is authorized to expend funds pursuant
to the Agreement for the purchase of various goods and services.
SECTION 5. This ordinance shall become effective immediately upon its passage and
approval.
PASSED AND APPROVED this day of , 2008.
PERRY R. McNEILL, MAYOR
ATTEST:
JENNIFER VVALTERS, CITY SECRETARY
BY:
APPROVED AS TO LEGAL FORM:
EDWIN M. SNYDER, CITY ATTORNEY
r ~
5 - ~ , ~
BY:
3-ORD-File 3623 rev
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: Transportation Operatio
ACM: Howard Martin, 349-823
SUBJECT
Consider the approval of a resolution of the City Council of the City of Denton, Texas,
requesting that the Texas Department of Transportation (TxDOT) and the North Texas Tollway
Authority (NTTA) waive the requirement to develop a Market Valuation for Interstate 3 5 East as
allowed by Senate Bill 792, further requesting that NTTA waive its right to develop the project
and support TxDOT's development of the IH 35E project from Interstate Highway 635 to US
Highway 380, and acknowledge that NTTA's primary role will be to provide the associated toll
operations at a reasonable cost; and providing an effective date.
BACKGROUND
In the Spring of 2007, the 80th Legislature approved Senate Bill 792 (SB 792) relating to the
development, contracting and implementation of comprehensive development agreements
(CDAs) for toll roads. CDAs provide a particular entity the right to develop additional capacity
for "on-system" TxDOT roadways utilizing a toll as a financing mechanism and providing
TxDOT a concession payment for the right to develop the roadway. SB 792 specifies that the
NTTA has the right of primacy on future CDA proposals in the North Texas Region. This right
of primacy essentially provides NTTA the right to establish the market value of a proposed toll
road project (what the concession payment will be) and the right of first refusal to develop the
project once market valuation is established.
The TxDOT Dallas District office currently estimates the construction of the entire IH 35E
project from IH 63 5 to US 3 80 at $2.0 billion. Funding for the project has partially been
identified through the application of $533 million from the SH 121 Regional Toll Revenue
Funding Initiative (RTRFI). As part of a Memorandum of Understanding in July 2004, Denton
County, NCTCOG, the City of Grapevine, the City of Coppell, the City of Lewisville, the City of
Carrollton and The Colony identified part of the funding received from the SH 121 toll project
would be utilized to advance the IH 35E project. The TxDOT Dallas District office indicates
that approximately $1.5 billion could be provided to the region should a CDA be facilitated on
the managed lane component of the IH 35 project through open competition with private firms.
To permit this competition, NTTA would have to waive their right to establish Market Valuation
and develop the IH 35E managed lane project. It is anticipated that if NTTA waives the right to
develop the proposed project, the competitive process could facilitate a $2 billion project with a
cost to the North Texas region of only $533 million. The CDA would generate a $1.5 billion
concession payment over time.
Additionally, there is concern that the Market Valuation process for this project will take entirely
too long based on past performance. NTTA and TxDOT have spent more than eight months
negotiating the market value for State Highway 161 (SH 183 to I-20) and as of April 8, 2008, a
final agreement has not been reached. A similar process on IH 35E, resulting in a correlating
timeline, will further delay the construction of this important mobility project which will result in
increased construction costs due to inflation. Furthermore, Denton County has initiated the
development of a bond package for consideration in the November elections. The current delay
with the market valuation on the IH 3 5E project has impacted the development of projects to be
included in the Denton County bond package. This impact results from NCTCOG delaying the
selection of new projects to be funded for Denton County as part of the SH 121 RTRFI selection
process until a viable funding source is identified for the IH 35E project shortfall.
ESTIMATED SCHEDULE OF PROJECT
The NTTA Board has targeted April 16, 2008 to consider their position on the IH 35E managed
lanes project. TxDOT indicates they could be under contract with a Comprehensive
Development Agreement by mid 2009 with construction to begin as early as 2010 should NTTA
waive their right to Market Valuation and primacy.
PRIOR ACTION/REVIEW
The Mayor and Mayor Pro-Tem directed staff to investigate the issue and proceed with a
resolution for City Council consideration if necessary. The Denton County Commissioners'
Court and the City of Lewisville have passed similar resolutions on this issue. TxDOT has
formally requested NTTA to communicate their position on the proposal.
FISCAL INFORMATION
Should the project be developed by NTTA, delays in the process could increase project costs due
to inflation. TxDOT believes a reduced payment/valuation should be expected from NTTA if
competition is not created through an open bid process. TxDOT has indicated the IH 35E
Managed Lanes proj ect could provide as much as $1.5 billion in funding to the region.
EXHIBITS
1. Resolution
2. TxDOT Letter dated January 31, 2008
3. City of Lewisville Resolution
Respectfully Submitted:
Mark Nelson
Transportation Director
s:1vuF d~c~mer~ts~resal~tRans~08~~5e resal~tk~n.doc
r EXHIBIT 1
~EDL[JTIDN ND.
A RE~LUTIDN DF THE CITY CDUNCIf, DP THE CITE DF DENTON, TEAS,
REtJESTIN THAT THE TEXAS DEPARTMENT DP TANSPDRTATIDN ~TxDDT}
AND THE NDRTH TEX.A►. TDLLAY AUTHD~.IT~ ~NTTA} NAIVE THE
REQUIREMENT TD DEVELOP A MARKET ~ALUATIDN FDR INTERSTATE ~5 EAST
A ALLD~vED BY SENATE BILL 79~, FURTHER ~EUESTINC~ THAT NTTA NAIVE
ITS ~IHT TO DEVELOP THE PROJECT AND UPP~~T TxD~T' DEVELOPMENT ~F
THE IH 5E PROJECT FROM INTERSTATE HIHAY ~3 ~ T~ ~ HICH,AY 3 S~, AND
ACNDLED~E THAT NTTA'S PRIMARY ROLE SILL BE TD PROVIDE THE
ASSOCIATED TOLL OPERATIONS AT A REASONABLE COST.
~vHEREAS, Interstate East ~IH E} is a rria~or north south transportation route in
Denton County that dramatically impacts nobility, air quality and economic vitality of the entire
North Central Texas region; and
WHEREAS, the ~ of Denton supported the tolling of SH 1 ~ 1 predicatcd on funding
and development of IH3 ~E from IH63 ~ to US 8~ in a "near tune frame"; and
~VHEI~EAS, the SH 121 Memorandum of Understanding executed by Denton County,
TxD~T, the North Central Texas Council of C~overn~nents ~NCTCOO}, the City of ~rrape~vine,
the City of Coppell, the City of Leesville, the City of Carrollton, and the City of The Colony .
affirmed the ~.eg~on's intent to fund ar~d open IH~ E to traff c by I I ;and
HE~EA, Denton County has funded more than n~~lllon in "on-system" roadway
tn~provements, through its road bond program, to roadrays connecting to IHE; and
WHEREAS, the success of the million iaa "onysytem" improvements by Denton
County are directly impacted by the timely development ofIH3~E; and
~UHEREA, Denton County, TxDOT and the NCTCOCx are scheduled to make
reconiendatians related to the expenditure of SH 1 ~ I Regional Toll Revenue funs Ire April
~~~8; and
WHEREAS, in 1Vlarch ~~08 Denton County initiated the development of a nevi hand
program for the November 208 election; and
i
s:~our ~otum~nts~resoiuti~ns~08~35e resai~tion,doc
HER~A, the qty ~f Denton believes that the region} best Interests are served if
~H5E is developed and fumed in a manner that permits construction from IH~S to U ~Sa
beginning na later than 10; and
H.EREA an Bela to the develo n~ent of IH~E and its mono ed lanes due to the y ~ ~ g
Market valuation process outlined in Senate Bi11792 v~ill dramatically increase the ultirr~ate cost
of ~HSE and case increased congestion} thereby negatively l.pact~ng the air quality, economy
and overall quality of life for residents in Denton bounty and North central Texas; and
HEREA~, sec, 22.E 1 l 1 0~ ~ states in part that the "department and local toll
pia j ect entity may after agreement an terra a and conditions agree to ai~e the requirement to
develop a market valuatian under this section", N~~V, THERE~`~RE,
THE DUNIL ~F THE CITY DENTIN HEREBY RE~LVE:
SETIDN I . The pity of Denton., Texas, does hereby request that the Texas Department
of Transportation and the North Texas Toll~vay ,Authority waive the requirement to develop a
market valuatian for ~HSE as allowed by SB 792 under the Terms and ~onditxons that the
corridor be developed utilising the Regional Transportation ~auncil's Managed Lanes Policy.
Further a request that the North Texas Tollway Authority v~aive their right to develop the
project, strongly support TxDDT's development of the IH3~E Managed Lanes Project from
IH~~S to ~ 38~ and acl~oledge that NTTA's primary role mill be to provide the associated
toll operations at a reasonable cast.
E~TIDN 2. This resolution shall be transmitted to the NT~~, NTTA and TxD~T
Dallas District inrnara.ediatel upon its passage and approval.
PASSED AND APPRD~ED this the day of , 2D~~.
PERRY R~ McNEILL, AYDR
ATTEST:
TENNIFER SALTERS, CITY ERETARY
. I
s.~o~r docu~ents~resolutions~o8~35e r~so~~,tior~.doc
i
APPR~V~~ A T~ I~~rAL FARM:
~~'IN ll~. ~I~, ~T~ ATTORNEY
BY:
_ i
EXHIBIT 2
era - rtr nr~ _a ~ ~ v~ ~ ~~o
1
P.O. BOX ~ 33067 ~ DALLAS, TEXAS 753 3-3067 * X214} 320-6100
January 31~ 2008 ;
Jorge ~igueredo, Ph.D.
Executive Director
North Texas Toi way Authority
P.~ Box 260?'29 _
Plano, TX T5o26
. Dear Dr ~igueredo
an September ~ 8; ...2007, M:aribei Chaves and i forwarded a listin of toll ro'ects
9 p1 that will require ~ market valuation pro~es~ as req~lred by senate :Bill 792 of the
80~~ Le islatu re co attached g t pY ~ _
. It must be-noted per senate Bill 792, _ neither TxDOT nor NTTA: Ana erform yp
develo merit activities an these ro`e is til ahe mark . - _ I 1 _ _ c ~n et ~a uat~on.. rocess or _ _ . _ p_._ _ . _ . , p_ p
. ~ .~a_. .
waiver thereof is accomplished. Deveapment activities have: been defined as
detailed design, pre~aretion of Plus, specifications and Estimate, acquisition
of right of way, and construdtion letting and ;award.
The , following ~ priority projects are being developed b TxD4T with RTC, v
Congressional end Local funding cornmltments~
IH 30 Managed Lanes from IH 35E to SH X61 and the Margaret
McDermott Bridge ~the.Trinty River ~igrtature Bridge}
SH 183: Managed Lanes from IH 35E to SH ~ 6
• IH 35E Managed Lanes from ll~ 635 to US 380
The following are actions required by Senate Bill 792:
"e. if a local toll project entity orthe department determines that a oll
project located within the boundaries of the local tall project entity should
be developed,. constructed, and operated as a toil project, the local toll
project. entity-:and the department mutually shall.. agree an the terms and
conditions for the development, construction, and operation of the toil
. project, .including the initial toll rate and the toll` rate escalation
methodology.:"
"e-~ . lf.the local toll project entity and the department are unable to
mutually agree on the terms-and conditions for the development,
THE TEXAS P~.AN
REDUCE CONGESTION • ENHANCE SAFETY • EXPAND ECONOMIC OPPORTUNITY • IMPROVE A!'R QUALITY
INCREASE THE VALUE OF OUR TRANSPORTATION A5$ETS
An Equal Opportunity Employer EXHIBIT Z
January 31~, 2~a8
Page 2
cons#ruction, and operation of he #011 project as required by Subsection
fie), neither the local toll projedt entity nor the department may develop the . project a~ a toll project."
To summarize this requirement from Senate B~kl 792, ricr to an further ro'ect
.develo meet of #hese riorit ro'ects. TxD~T and NTTA must a tee on the
1"erms and Conditions for these ro'ects.
senate Bill 792: also states:
"~f-1 ~ The department and a local toll project entity may agree tv waive
the requirement to develop a market j~aluatian under this section."
TxDOT and NTTA could conduct the Market valuation,-or both agencies could
. waive the Market Valuation, but only after agreeing, o the Terms, and Conditions
for these: ~ ro'ects.
in addition, Senate Bill 79~ states:
"~c~ A local toll project entity is the entity -with. primary responsibility for the
financings construction, and operation of a toll project located within its .
boundaries." _
To summarize this requirement tram Senate Bi1179~, after cor~plet~on of the
Market Valuation Proceas {or waiver), NTTA has the first option: to develop these
projebts. NT~'A also has the ability to waive primacy if the NTTR does not v~ant
to develop these priority projects.
~'he region and TxD~T avuait out mutual agencies in accomplishing these steps
as required by Senate Bill ?92. Any delays in getting these steps completed
result in a corresponding delay improving the congestion and enhanci~~ safety
on critical components of the transportation systern ~ -
Sincerely;
f~
Williarr~ L.-Hale, P.E.
~~stnct Engineer
Dallas District
Lo
January 3~ 2008
Page 3
Attachments. Letter of September 18,:2.x01
:~SH 12~ Tolling MOIJ
2008-20 ~ 1 TI P .
cc, Michael Morris, P.E.
Denton County Commissioners C~u~t
Dallas County Camrnssioners Court
City of Dallas Mayor and City Council
City of Irving I~Ilay~r~jand .City Council
City oflFarrners Branch Mayor and City Council
City of Carra lion Mayor., and City Council
City of Lewisville Mayor and Ci#y Caun~il
City of Shady Sho-res., Mayor and Cify Council-
City of Corinth Mayor and City Council .
City of Dentan Mayor and City Council ~ ~
i
EXHIBIT 3
I~.ESLU'~IC~N l~t~, 35~~-0~-2~~8(~~
A T~~~~:'~N `~P THE ~~'~Y C~DCJN~~ T'~L QTY
~~'~LE, '~~XAS, RE~~S~'~1~~ WHAT ~H~ I
~~P~RTEI~'~ ~F TAI~P~~.'~AT~(~1~ ~~`x~►Q~'}
A►~l~ THE N~FtTH .'TEXAS ~"C~~,L~'A~' AT'~~R~T'Y
:'~`A) A~~E THE R.~~~R~M~NT T~1 1~E~`LL~P A
VAL~AT~C~~ ~`OT~ ~H3~~ A~ ALL(~''~ED ~'Y
79; . ~~T~N~ NTT "~AI~~ STS ~~~~T ~"Q
~~E~~►~ "SHE PROJECT, ~~J~Pt~R"T TX~~'~'
D~'~~L~~N~~NT ~F THE ~H3~~ P~:C~J~~T Ft]R 6~
T~J I~;S 3~a;. AND A~KNf~'V~L~~~E - ~`~A'~ NTT"A'~
P~A~~: R~~ILE r~~~ PR~~VI~~ TAE;
ASC~~,~TE~ ~t~LL (~~~~AT~~1'~~ A~" A ~EASC~~~.EE ~I3ST~
~VVHE~AS~, the pity of ~,,e~visville's suppa~t for the tolling of ~2 i vas predicated on
fundin and development of ~H3~E 'within Lewisville in ~ ``near time frame" and,
'~HL~EA the SH 1 ~ 1 ~emorandu of Understanding executed b~ Benton ounty, {
~'x1~U~' the ~(orth central `texas ~a~.n.cil of ~overnn~ients the City of Ler~is~viiie and other
Tlenton fount cares aff rmed the l~~gi~n's intent to fund and open I~3 5~ to tr~ff~c ~y 20.11; Y
~~"!d,
'"~HE~EAS, ~ento~ ~or~at has funded through its road bond program: m~~e than $25U
~nill~on ri "on-system" road~va~ irnprove~nents to raad~va~s that connect to 1~351~;..and,
'"V~HER~A, the $~5o million rn "on-system"' improvement success are directly
impacted by the timely development of ~H35~; and,
~HE~t~A~, l~er~ton fount , Tx~~~~ and the, NCT~C~G are scheduled to make
recom.~:endations related to the expenditure of 5H 1 ~1 regional Toil 1~e~en~e funds in A.pr1i
~aog; -and,
i
~S~3LUT~C~N NU. ~~~~~~~~:Q~~~ - Pale 3
DULY BASED AND A~PRt~~"~~ ~Y CITY `~~l~N~~L tl~ QTY
~E'U~~'~~~E TEAS [ll~ '~HI~ T~I~ ~?t~` SAY' C~~ ~.R.~~ Za~B.
A~'P~(]~"ED:
Ce~e ~~~ey, ~AYf~R
AT`~~~T:
~~le ~~i~~, CITY ~~R~~A~
AP~~P~C~'ED AS T~
~ana~d N ~ ~ an, CITY 'AT~`~~~NE'Y
i
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: Utilities
ACM: Howard Martin, 349-823
SUBJECT
Consider adoption of an Ordinance approving an Agreement for Deposit of Costs for Off Site
Paving in the amount of $2,512,936.95 between the City of Denton and Aldi (Texas) L.L.C., a
Texas limited liability company, for the construction of off site paving improvements to
Westcourt Road, authorizing the City Manager or his designee to execute said Agreement on
behalf of the City of Denton; and declaring an effective date.
BACKGROUND
Aldi (Texas) L.L.C. (the "Developer") is constructing an office building and distribution center,
primarily housing a warehouse distribution center for retail grocery outlets, at the southern
terminus of existing Westcourt Road. The property is on the southwest quadrant of the
intersection of Westcourt Road and Springside Road. As part of final plat approval, the
extension of Westcourt Road through the development's property in accordance with the
Mobility Plan was deferred until the remainder of their property is platted and developed;
however, the improvement of Westcourt Road from F.M. 1515 (Airport Road) south to
Springside Road as half of a secondary arterial was a condition of plat approval in conjunction
with this deferral. These improvements were necessary to bring Westcourt Road to a level of
service adequate to serve the proposed development together with the existing background
traffic.
The off site improvement of Westcourt Road as a component of this development was captured
in the Tax Abatement Agreement between Aldi (Texas) L.L.C. and the City, approved by City
Council on August 21, 2007 with Ordinance No. 2007-176. The provisions for the issuance of a
building permit and/or certificate of occupancy for on-site improvements in advance of the
completion of Westcourt Road improvements and the completion and acceptance of Westcourt
Road prior to the granting of the tax abatement were captured in the Amendment to a Tax
Abatement Agreement between Aldi (Texas) L.L.C. and the City, approved by City Council on
January 8, 2008 with Ordinance No. 2008-006. Aldi (Texas) L.L.C. has agreed to deposit
sufficient funds with the City to ensure the completion of Westcourt Road prior to March 1, 2010
or, failing that, for the possible completion of Westcourt Road by the City in the event that the
development fails to move forward to completion as planned. The attached agreement provides
the City with the mechanism needed to accomplish this completion of Westcourt Road.
OPTIONS
1. Approve the deposit agreement with Aldi (Texas) L.L.C.
2. Reject the deposit agreement with Aldi (Texas) L.L.C.
RECOMMENDATION
Staff recommends approval of the deposit agreement with Aldi (Texas) L.L.C. in the amount of
$2,512,936.95.
PRIOR ACTION/REVIEW (Council, Boards, Commissions)
Not applicable.
FISCAL INFORMATION
Not applicable.
BID INFORMATION
Not applicable.
EXHIBITS
1. Agreement for Deposit of Costs for Off Site Paving
2. Ordinance No. 2007-176.
3. Ordinance No. 2008-006.
Respectfully submitted,
Frank G. Payne, P.E.
City Engineer
i s:la~r docurnentslnrd~nancesl~Slal~i ~ffsit~ paving ag~eement.dac
EXHIBIT 1
~RDI~ANCE No.
AN ORDINANCE ~F THE CITY ~F DENTIN, TEXAS, A~JTH~RIZIlI~G THE CITY
MANAGER, OR HIS DESIGNEE, TO EXECUTE AN AGREEMENT KITH ALDJ TEXAS}
L.L.C. FAR DEPOSIT OF CASTS FOR DFF~SITE PAVINCJ FAR A P~RTIGN OF
ESTCO~TRT ROAD FROM AJRPORT ROAD TO SPRINGSIDE ROAD; AND
DECLARING AN EFFECTNE DATE.
THE CDI~NCIL OF THE CITY OF DEI~TON HERESY ORDAINS:
SECTION I. The City Manager, or his designee, is hereby authorized to execute an
agreement for deposit of costs for vff site paying betv~eer~ the City of Dentan ar~d Aldi Texas}
L.L.C. which is attached hereto and made a part hereof.
SECTION 2. The City Manager, or his designee, is authorized to exercise all ~.ght and
dudes far the City ofDenton under this Agreement.
SECTION This Ordinance shall heco~ne effective immediately u~pan its passage and
approval.
PASSED AND APPROVED this the ~ day of , , ~~~8.
PERRY R. McNEILL, MAYGR
ATTEST
JENNIFER SALTERS, CITY SECRETARY
y. .
APPROVED A CAL FO
EDWIN NYDER, CITY ATTO Y
~y
i
AC~RB~~NT F~1~ DE~CSIT P CASTS FAR ~-ITS 'AVID
I
T~ AR~~~NT the "Arec,ent"~ is ~e by aid bet~veen Audi ~Texas~ I~~.C., a
Texas kited ]iahi~.ty company the "De~eio~er"~ and ~ CITE DENTS, TEAS, ~ home rule ~nunicipa~ty: located in Denton ountyt Te~cas the "C~'}, as of ~ E~`eG~ve
Date
provided belavv, upon tae terms and condi~.ans set forth herein.
AREAS, the Developer is the owner and developer of a connnereial subdivision
property located at a southern gnus of existing e~tco Road at its intersection
pringside Road, a development iocad in the City of Denton, Texas the "Development"~, as
mare particuiaxly described Ordinance ~Io. 17G ~ the Tax Abatement ~g~oement
a~ttaehed thereto, both of which are made a part hereof by reference; and .
the City has identified that the t~ansporta~on ~ of the tia1 phase of
the Deveiopment necessitate, in part, constriction of public ~ve~.en to a portion of
estcourt Road, in order to bring it to a bevel afserce anal capacity that is adegte to serve ~e
initial phase of the Development ~hereina~er, the "off-bite Pang ro~t"~, the sao of
which is defined by puns entitied "Aldi Distribution Cuter estcou~rt Road hnproven~ents from
Airport Load Springside Rand", prepared by Bury~-Pattners-DF~, Inc., City of Denton
Pj ect o. CP4S-~~~ and
aver consultation v~ith its engineers, the City has d that ~t is feasible to defer the Developer's obligations for the cons~~uan of the ~-Ste Pa~~in
I~nproven~ent ~`estco Road} until aver issuance of a building permit for aouc~on of on-
~ite i~nprove~nents associated with the Development; and
~R~, the City and Developer have sarately agreed tha# the tax in~ves
grated for the Development shall be Withheld until aver the con~p~e~on off' developer's ahare of
the -Site Pan Itnpr~ovexnent of etcourt Road, all as more par~cularly desoribed b
. tdinance o. BOOS-~o6 and the Amendment to a Tax Abatement ~g~nent a~ied thereto,
both ofwhich are n►ade a part hereofby reference; and
aver consultation nth its engineers, the City has determined the
I]evelopex's propo~ionate share of the cost of the deign and eanstruon of the ~-~~e Paving
Improvement knot including the value or cost of any additional required right-of-~v~ and
easements to be acquired by a ~3eveloper as part of its responsibility consttt the Qf~-bite
Paving Irrrprovnent} tQ have a present value of ~~,5 ~ ~,93.~, be placed on depot ~ an intent bung account to secure design and constxuc~on of the ~-bite Paving Irovnent
by Developer, a~ set forth herein the "Deposit„; and
THEREP~RE, in consideration of the ~nual covenants contained h~ ~
sufficiency ofch is hereby a~ckno~rledged, the pies agree a~ follows:
I. The ~eve~oper hereby delivers the Deposit to the City and c~ornmits to obtain e
required right-of-~vay and easements as needed and perfv the cansan to complete the
i
i
~-bite Pa I~npr~ve~nent. Tie epo~it, to~et~er t~ cued i~teret~ sha11 be disb~urs~ed t~
the Developer by the pity for Anent of the digs aa~d t~struction of the ~-Site ~av~g
hnprove~nent. Developer stipulates that Deposit is an escrow payment in aictp~tion of ~ .
Developer's construction of the Q~Site Paving Improvement of westcourt Road, and not
impact fee. Developer further s~pulates that the l~f~ite Paving Improvement oblig~~ion {or, alternatively the Deposit}, taeter with a~,~ acq~iitYOr~ of right-af~~vay
andl~r ~eaee~ts
~ far construction, are, ~ combination, roughly prapvr~anate to the transpar~a~an , irr~pac#~ exerted to be generated b~ the ini~a~ phase of the Development, and that
essential
nexus e~is~ between can~bined exaction and the development*s tsporta~ion impacrtt. City
stipulates and acknowledges that span: { ~ ~ Developer ~ the Deposit a+ccarding to the terns
defined and pres~bed herein, acquiring any ~aeeded right-of-a}~ and eernent~, a~.d proc~ed~
to cor,~plete the construction of the ~f~=Site ~a~i~n proverne~t of esa~rt Road, aid the
it's acceptance of any required rihtyof-~va~ nr easement dcdieation nec~sar~ to ea~struetion,
such combined exaction stands rn full satfactian of Developer's obligation to dedicate anti
construct the ~-Site Paving hnpravement far all purposes, speaif~cal]y including, but not
ii~.ited to, the saatissfatron of that pai~cular obligation in vbtai~ing a building pmt anvr
certificate of occupancy for any structures to be constructed within the Development, regardless
of whether the "-Site Paving Improvement is actuary completed at the tune of apPlica~on ~'or
eYther, correlatively, Developer stipulates and acl~awledges that no other obl~ga~on or
condition relating to the issuance of a building permit yr ceihcate of occupancy is satisfied by
this ~.greement, and that the rty's subsequent suspension, revocation or enforcement action
relating to any subsequently issued building permit ar certifcate of occupancy shall riot, if taken in goad faith and bred upon the failure of any other requirement,
constitute a breach ar
repudiatia~a by pity of the terms of this A.greemeat,
2, Developer shall provide ~non~y invoices to the pity in Ming relive to all portions of
the design and construction costs required far the -Site Paving Inrproven~ent upon
can~mencement of construction of the ~~-Site paving I~r+ovement and, upon confirmation by
pity personnel of acfi~al work completed on westcourt Road, the pity shall Pay each such
invoice out of the funds an deposit in the escrow account, such mount berg speciic~ahy
. required ~ ensure completion of the Off-1te Paving Irove~ent p~roect. If Developer
breaches this agreement and falls to cure the breach within fif teen ~ 15) days of written na~ce of
such breach, or fails to complete the construction of westurt Road prior to larch 1, ~~1~,
then the pity shall have the right to use the remaining funds in escrow to complete construction
of the off-site Paving ~prave~nent of estr~u~rt Road, Ire the evont that there are inu~'icient
funds remaining in escrow tv complete the car~s~uction of the off-site Pang I~npravernent o~
estcourt Road, then the Developer shall pay to the pity, withl.n ten { 1 a~ days after receipt of
demand for payment, the difference between the cost complete construction of the ~#l=Site Paving Improvement of estcaurt Road and the re~naiuing ~ , when
the
construction of the ~`-Site Paving I~nprovernent of westurt road is completed and accepted,
if #hete are stiff funds in the escrow account, such funds shall be released to the Devveloper and
this ~g~reement shall terminate.
off. Any notice, demand or other communication requd or permitted tv be
delivered hereunder bother than invoices to be delivered as hereina~er described shall be
deemed received when sent by United States mail, postage pre-paid, ~~ed mail, rehun receipt
Agreement -page 2 .
i
s k
i
reques#ed, addr+essed to each respective paarty, or sent via fa~cs~rni~e ~ the fax number set ford for
each party, as folla~s:
t~ 1e 1 ~ C to:
The pity ~f D~nto~ TC~as ~t~ A,ttarne~
2 ~ E. l~c~ir~ney pity of Dton, Texas Dentc~n~ Texas 7~ ~ 21 ~ ll~c~ney
Attention: City Manager Denton, Texas ~~2~ ~
Fax 1Vo.: ~~4~~ ~~-5~~6 Fax 1Vo.: X944} 382-'~~
~f to,the Devel , er: with ~ c ta:
Scott . Huss Daniel J. Bayne
'Dice President .ayne Law group
Aldi `exa~~ L.L.Q. 612 Park street
~ 51'~ Centre Place Drive, quite 22~ quite 204
Denton, 762 ~ ~o~urnbus, Ohio 4~2 ~
Fax o.: X940} 4~2-~'~84 Fax Na.: ~614~ 9-768
A~rxy of the parties hereto may Change their respec~ve notice addresses for all eommtions
and invoices by a nonce delivered in accordance v~th the terms and conditions of this eion
4. A ~icab~~ w• ~e~ue. This Agreement shah be construed under and in aecordauce with .e laws of the State of Texas, and all obligations of the parties created hereunder
aye fuily
perforrrnable in Denton bounty, Texas. Exclusive ven.~ue for an~~ln~rsuYt enforcing or interpre~ng .
any of the rights and obliga~ior~s under this agreement shall be a Court of ornpeten# juxisdic~ion
~ Denton Jaunty, Texas.
~ind~ Effect. This Agreement sha11 be binding upon inurre to the hene# of the
~ and their respective heirs, executors, adrninistra~rs, legal representa~vcs, successors and
assigns w~.ere permitted by this Anent. The signaries blow represent that they posers
full legal authority to obligate they respevc corrate en~ties to the terms of this Agreement.
dale _ nett. This Agreement constitutes ~e sole and only agreement of a parties,
a~ad supersedes any prior understandings or written or oral agreements between the pasties
respecting this subject matter. o other ahligatzons or duties exist on Wither party wig respect to
the 'f-ire fag Impr~ve~t of estourt Read. Developer wai~os y and ah ~tlier lms
with respect to the Deposit
Tune of the Pssence. Tine is of the essence this A~~t. However, in a event
that construion is delayed due tC Deaeloper's i~ility to acquire needed gents and ri #s-
~ ~ ■ ■ r y r of-way, such that pity s acqu~s~t~on b}~ eminent dom,am of publ~e propey is require., the staff
deadline far complerion of co~ction may he exten if neces so as to ded, nary, require
cornpleon na ~a# tha~~ twelve ~ 12~ mantle ~ollo~ the da#e ~f aCquisi~on.
Aeeen# ~ Page 3
I I M
f 3
1 1
S. ~u~nber and e~ndex. Ards of any eider used in this Agreement shah be held and
cons~.ed include any other gender, words in a singular number shad be held to ~nel~de
the plural, and wee versa, unless the context re~u~res othe~se.
~riorpora~ien of ~eeitals. T`he reeita~s the prea~.b~e ~f this gnent are substave
and are incorporated Ito the body of this ement refereu.
~n~terprct~~ion. This agreement was prepped a a collahaive el~o of a~eys for
b~~i parties. A.eeordingly, the parties s~pute and agree tha# any dlspute~ sun+ound~g ~
ir~terprc,tx of this A~reenaent should not be biased ~ either party as a ~er*
~E`I as a~ the ~ day of ~S the "~ff,ye, I]a"~.
~ FI'' ~F I~~1~TOI~,'T~Aa
i
earge ampbcll~ City Manager
E, Memey
Denton, Texas '3~~D 1
~'a N'o. ~94~} 349-559
A.~T:
J~N'NI'F`ER ALTER, ITS ~~TA~tY
Ey
APP1~~~ED A TO F~1~:
~DIl~T 1~TYD~, CITY A~TT~~Y
Aldi ~Texas~ L.L.,
1 ~ 1 ? e~ glace Ir~~re, to X20
Doriton, 'T 10
A 'texas Lilted Liability amlY
~y: Aldi Inc. ~elav~are} ~ I~eiare corporation,
dole ~Ule~ber
k .
Scott ~u~, Vice President
Agreement - ~a e 4 ~ ~
i
S
TA~TE ~F TFA ~ i
C~T"~ ~F ~~N'I'~ ~
This ~ur~e~t is ac~new~~dged bef~~e me, vn ~s ~ day of
~~4~, by George a~pbe~, City anger of the City of Derr~on, a
~.u~ci~. carpor~~i~n, ~n behf of mid ~nu~ic~pal cor~ati~n..
Nosy Public ~ ~ f
~~at~ ~f Teas - .
T~T~ ~F T,~~ ~
C~N'~`~ ~F D~T"~N ~
's intrume~t was a~knowled~ed before ~e on this ~ day of
by Sc~ , ~usica, tee Pres~de~t of Audi ~c. el.aware~, a
~eXav~e eorpora~i~n aid Sole Member of Audi 'Texas} L.~.,, a Texas Lgiitd ~iabili~y Ccam~a~y, o~ behalf of paid e~oration ar~d ,iced ~iabiiity caPa~y. ~
.
~ ~~~fA ~ 1i 4~~ IT ►
Notary P~~~ic, state of Texas
f{.~t~ ~~}~t~ ''+~l;I~~~~~` MarCn ~6, 2~a 1 tai efTe~as
Y
Aeen~ent ~ Pale 5
l
r
s:l~~ur docunlct~t~lordinanceslQ7laldi abatement c~rd.doc
,y { ~ EXHIBIT 2
'15
V 11LJ 11 1~~JE 11 V. w
AN ORDINANCE AUTHORI2IN0 THE MAYOR TO EXECUTE A TAX ABATEMENT
AGREEMENT wITH ALDI ~TEXA} L. L.C,; ETTIN~ FORTH ALL THE REQUIRED
TERMS OF THE TAB AIATI~ENT AGREEMENT IN ACCORDAI~ICE KITH THE
TERMS OF CHAPTI~R ~ l2 OF THE TEXAS TAX CODE; ETTIN FORTH THE ~ARI-
OU CONDITIONS PRECEDENT TO ALDI TEXAS} L.LC~, A TEXAS LIMITED L IAI~IL-
ITY COMPANY, I~ECEIINC THE TAX ABATEMENT, PRO~IDINC~ FORA E~ERABIL-
ITY C LAUSE; AND PRO~I D II~C AN I~FI~ I~CTIVE DATE.
wHEREA, on the ~ ~ day of August, ~D~7, after a public hearing dul~r held in accor-
dance v~rith Tex. Tax Code ~312.2~1 the "Act"}, the City Council passed Ordinance No. ~~07~
the "Ordinance"} estal~llshing Reinvestment done No. VIII, City of Denton, Texas as a
cornmerciallindustrial reinvestment zone for tax abatement the "done"}, as authorized by Title
Cl~apter ~ 1 Subchapter B of the Act; and
wHEREA, on the 4t'' day of June, ~~~7, Aldi Texas} L.L~C., submitted an application
for tax abatement with various attachrr~er~ts to the City concerning the contemplated use of cer-
tain property located within the done; and
wHE>,EAS, the City Council finds t1~at the contemplated use of the premises and the
contemplated improvements to the premises, as indicated by Aldi Texas} L.L.C., are consistent
with encouraging the devclopn~ent of the done in accordance with the purposes for its creation
and are in compliance with the Denton Tax Abatement Policy; and
WHEREAS, the City Council deems it in the public interest to enter into a Tax Abate-
117entAgreement with Aldo Texas} L.L.O.; NOS, TI~IEREFORE,
THIS, COUNCIL OF THE CITY OF DENTON HEREBY ORDAIN:
c
SECTION 1. Tl~e findings contained il~ the preamble to this ordinance are true and cor-
rect and are adopted as part of the whole ordinance.
SECTION The City Council finds alld determlr~es the following:
A. That the contemplated use of the premises and the contemplated improvements of the
premises, as indicated by Aldi Texas} L,L.C. arc consistent with encouraging the de-
veloprr~ent of. the done in accordance with tl~e purposes of its creation and are in
compliance with the Denton Tax Abatement Policy.
B. That the City Council finds that the improvements sought by Aldi Texas} L.L.C~
within the Zone are feasible and practical and would be a benefit to the land to be in-
cluded in the ~onc and to the City after the expiration of the Tax Abatement Agree-
ment to beentered into with Aldi Texas} L.L.O.
s:lc7ur documen~~lordinances1071a1di abaten~e~~t orc~.d~c
5
{ That the City Council finds that the Tax Abatement Agreement contains all the terms
which are n~andatorily required to be Included in any tax abatement agreement under
~ 12.2x5 ofthe Act.
D. That, in accordance with X31 ~,2a41 of the Act, the City Council finds that not later
than the date on which the City Council considered this ordinance, and not later than
the seventh day before the date the City enters i~~to a Tax Abatement Agreement kith
Aldi Texas} L,L,C., that the City Manager, through the Director ofEconorr~ic Devel-
opment, who are l~ereby designated and authorized by the City Council to give such
notice, delivered to the presiding officer of the Denton Independent School District
and Denton County a written natice that the City intends to enter into this Tax Ab-
atement Agreement with Aldi ~Tcxas} L.L.C., and that this natice included a copy of
the proposed Tax Abatement Agreement in substantially the form of the Tax Abate-
ment Agreement attached to this ordinance.
E. That before the passage of this ordinance, the City Council held a public hearing in
accordance with ~312.~~1 ofthe Act and created Reinvestment bane Na. VIII,
F. The Clty Council f x~ds that the prod ect within Reinvestment done No. VIII is a rede-
veloprrient of an existing business as defined in the Tax Abatement Policy and re-
quires additional incentives to promote economic development that generally satisfies
the requirements of the policy and the City Cauncil hereby authorizes a tax abatement a
of a maximum of 1 ~~°I~ on the Increased valuation of the Taxable Real Property ini-
provements and tangible personal property as mare particularly described in the Tax
Abatement Agreement attached hereto and made a part hereof by reference as exhibit
"A" the "Tax Abatement Agreement"},
SECTION The Mayor, or in his absence, the Nlayar Pro Tens, is hereby authorized to
execute the Tax Abatement Agreement with Aldi Texas} L.L.C. in substantially the same form
as the Tax Abatement Agreement attached as llxhibit "A"
SECTION 4. The City Council hereby instructs and authorizes the City Manager to in-
spect, audit, and evaluate the progress of Aldi {.Texas} L.L.C. to determine if it has met all of the
conditions of the attached Tax Abatement Agreement prior to the tax abatement going into of feet.
ECTIDN 5, If any section, subsection, paragraph, sentence, clause, phrase, or word in
this ordinance, or application thereof to any person ar circumstance is held invalid by any court
of` cotr~petent jurisdiction, such holding shall not affect the validity of the remaining portions of
this ordinance, the City Council of the City of Denton hereby declares that they would have
enacted such remaining parttot~s despite any s~lch validtty,
SECTION This Ordinance shall became effecti~re inrn~edrately upon its passage and
approval.
Page ~ o f 3
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s:1cx~Gr d~c~ymentslordinance~1~71~1cii ~batemc}nt cjrd.doc
5
PASSED ANA] APPR~V'EI] the the ~ ~ day of , 2~~?,
~ .
P~R.R cN~ILL,IVIAYDR
ATTEST:
~ENN~"E~ ALTER, CITY E~IETARY
BY;
AP~R~~IE~ AS T~ DEAL FARM:
~DI~ . SNY1~Ek, CITY ATTORNEY
BY:
Pale 3 of 3
TAX ABATEMENT A~EEMENT
This Tax Abatement Agreement the "Agreement"} is entered into by and between the
City of Denton, Texas the "City"}, duly acting herein by and through its Mayor, and Aldi
Texas} I.L.C. a Texas limited liability company the "Owner"}, duly authorized to do business and in goad standing in the state of Texas, duly acting herein by and through its
authorized oi-
cer.
WHEREAS, the City has adopted a resolution which provides that it elects to be eligible
to participate in tax abatement and has adapted guidelines and criteria governing tax abatement
agreements known as the Denton Tax Abatement Policy; and
~VHEREA, on the ~`h day of December, 2005 the City Council of Denton, Texas the
"City Cau.ncil"} adopted the Denton Tax Abatement Policy the {`Policy"}, a copy ofwh~ch is on
file in the City of Denton Econorr~ic Development Office and which is incorporated herein by
reference; and
wl-IEREAS, the Polley constitutes appropriate "guidelines and criteria" governing tax
abatement agreements to be entered into by the City as conterr~plated by section ~ 12.002 of the
Texas Tax Code, as amended {the "Code"~; and
WHEREAS, on the 21 ~t day of August 2007, the City Council passed Ordinance No.
~ the "Ordinance"} establishing Reinvestment done No. VIII, City of Denton, Texas, as a
comrr~ercial~industrial reinvestment zone for tax abatement the "done"}, as authorized by Title
3, Chapter 3 l 2, Subchapter B of the Code the "Act"}; and
~VHEREA, Owner will be the owner, as of the Effective Date has hereinafter defined},
which ownership is a condition precedent, of certain real property, more particularly described In
Exhibit "A" attached hereto and incorporated herein by reference and made a part of this Agree-
ment for all purposes the "Premises"} located entirely within the bane as of the Effective Date;
and
l-IDEA, an the 4th day of .Tune X007, owner submitted an application for tax abate-
n~ent with various attachments to the City concerning the contemplated use of the Premises the
"Application for Tax Abatement"}, which is attached hereto and incorporated herein by reference
as Exhibit "B"; and
WHEREAS, the City Council finds that the contemplated use of the Premises, the Con-
templated lmproven~ents has hereinaer defined} to the Premises as set Earth in this Agreement,
and the other terms hereof are consistent with encouraging development of the done in accor-
dance with the purposes far its creation and are in compliance with the Ordinance and Policy and
similar guidelines and criteria adapted by the City and all applicable law; and
WHEREAS, notice has been published in accordance with Chapter ~ l 2 of the Tax Code
and urritten notice that the City intends to enter into this Agreement, along with copy of this
Agreement, has been furnished by the City, in the manner and by the tine prescribed by the
Code, to the presiding officers of the governing bodies of each of the taxing units in which the
Premises is located; and
N~VV, THERF~F~RE, the City and owner for and in consideration of the premises and
the promises contained herein da hereby contract, covenant, and agree as follows:
I.
TER.I~I ADD C~NDITI~N ~F ABAT~M~>~T
A. In consideration of and subject to the owner meeting all the terms and conditions
of abatement set forth herein, the City hereby grants the following tax abatement ~"Abatement"}:
1. An abatement equal to 1 ~~°lo of City ad valorem taxes attributable
to new capital investments resulting in an increase of assessed value of real property irnprove-
rrlents to and tangible personal property including inventory and supplies} located on the Prem-
ises but only if such increase is at least 25,aa0,~~0 over the assessed value of the Premises and
tangible personal property including inventory and supplies} located on the Premises as of Janu-
ary 1, ~~07, for a period of five years commencing on January 1 of the year fallowing the
owner's receipt of a certificate of occupancy ~~the "C~"} far the Premises, If such increase in
assessed value is less than $25,~0~,~0~ there v~ill be no Abatement,
B. A condition of the Abatement is that, by December 31, ~~09 subject to force ma-
jeure delays not to exceed 180 days}, a capital investment which results in an increase in the as-
sessed values contemplated by section I.A.1 be made to the Premises, For the purposes of this
paragraph, the term "force n~a~eure" shall mean any circumstance or any condition beyond the
control of owner, as set forth in ectian ~I "Force 1V[ajeure" which makes It lmpass~ble to
meet the above~ment~oned thresholds.
The term "capital investment" is defined as the construction, renovation and
equipping of the Improvements on the Premises the "Contemplated Improvements" or "Im-
provements"} to include ~ 1 }casts related to the development and improverr~ent of the rent estate,
lncluding, without llrnltat~on, construction costs and design and engineering costs; ~2} tangible
personal property located an or at the Contemplated Improvements by owner, including inven-
toryand supplies. The kind and location ofthe Contemplated Improvements is more particularly
described in the Application for Tax Abatement.
D. A condition of the Abatement is that the Contemplated Improvements be con-
structed and the Premises be used substantially in accordance with the description of the project
set forth in the Application for Tax Abatement.
E, A condition of the Abaterr~ent is that throughout the Term of the Abatement, the
Contemplated Improvements shall be operated and maintained far the purposes set forth herein
sv that the uses of the Premises shall be consistent with the general purpose of encouraging de-
velopment or redevelopment of the done, except as otherwise authorized ar modified by this
Agreement.
_ _
rage L
1
F. A condition of the Abatement is that the Owner shall construct wescaurt Raad,
from Airport Road south to Springside Road ~a distance of approximately 4,~oI~ linear feet} as a
two-lane, concrete road and to specifications acceptable by the City of Denton. Construction of
westcourt Road must be completed and accepted prior to the issuance of a Certificate of Occu-
pancy by the City of Denton.
The City shall have the right to terminate the Abatement if the Owner does not
occupy the Contemplated Improvements continuously far the term of the Abatement for the pur-
poses set Earth in the Tax Abatement Application. In the event of such termination the Omer
shall refund to the City all previous tax abatements and all tax abatements far future years shall
be terminated.
~I, Owner agrees to ca~nply with all the terrr~s and conditions set forth in this Agree-
ment,
II.
FAIL~JR~ TO MEAT CONDITIONS
A. In the event that ~i} the conditions in paragraphs I~B} through I~H} are not met; or
iii} Owner allows its ad valorem real property taxes with respect to any properties owned within
the city limits of the City of Denton with respect to any real property and tangible personal prop-
erty, if any, owned by the Owner, owed the City to become delinquent and fails to timely and
properly follow the legal procedures for protest andlor contest of any such ad valorerrr real prop
city or tangible personal property taxes; ar viii} any other conditions of this Agreement are not
met, then "Condition Failure" shall be deemed to have occurred fit being understood that a
Condition Failure relating to any condition set forth in paragraphs I~B} through I~~I} shall not be
deemed to occur merely because at a particular time it cannot be determined whether such candi-
tionwill be met, but shall occur only if at a particular tine it can be definitively determined that
such condition will not be rnet}. In the event that a Condition Failure occurs, the City shall glue
Owner written notice of such Condition Failure and if the Condition Failure has not been cured
or satisfied within ninety X90} days of said written notice, the Abatement shall be terminated with
respect to the year in which notice of the Condition Failure is given and all future years; pro-
vided, however, that if such Condition Failure is not reasonably susceptible of cure or satisfac-
tion within such ninety ~9~} day period and Owner has commenced and is pursuing the cure or
satisfaction of same, then aver first advising City Council of efforts to cure or satisfy same,
Owner may utilize an add~tlanal ninety ~Q} days. Tirrte in addition to the foregoing 18~ days
may beauthorized by the City Council. It is understood that the Abatement with respect to any
year prior to the year in which notice of the Condition Failure is given shall not be forfeited or
recaptured except as indicated under Section II.B hereof. Notwithstanding any provision in this
Agreement to the contrary, Owner shall refund to the City all tax abatements previously received
with interest for the year in which the notice of Condition Failure is given.
B. If, however, the Owner fails to construct any structures or other improvements, or
fails to install any equipment or other tangible personal property within the Premises by Decem-
ber 1, X009 or if the Owner fails to construct estcourt Road as described in IMF}, ar the value
rage )
of the I mprovements falls below the tninimurr~ ~5,~a0,a0~ threshold during the terra of the Ab-
atement, then this Agreement may be terminated by the City. I n such event, Owner shall refund
to the City all tax abatements previously granted and received under this Agreement with interest on the amount to be refunded at six percent ~6°Io} per annum.
In the event of a Condition Failure by Owner which is not cured ar satisfied a set
forth herein, in addition to a partial or total recapture of the tax abatement, the City may cancel
or modify this Agreement.
III.
RECORD A]~D EVALUATION OF PROJECT
A. The Owner shall provide access and authorise ir~spectian of the Premises by City
e>~playees and allow sufficient inspection of financial information related to construction of
westcourt Load to insure that the Improvements are made and the thresholds are met according
to the specifications and conditions of this Agreement. such inspections shall be done in a way
that will not interfere wrth Owner's business operations. City shall annually for such other times
deerrxed appropriate by the City evaluate the Project to ensure corrxpliance with this Agreement.
B. The City Manager shall make a decision and rote an the eligibility of the Project
far tax abatement based on the information furnished each year by the Owner an or before Au-
gust 1 of the taxable year and shall so notify Owner and the City Council.
C. During normal office hours throughout the Term of this Agreement, providing
reasonable notice is given to Owner, the City shall have access to the Premises by City employ-
ees for the purpose of inspecting the Premises and the Improvements to ensure that the Im-
prove~nents are being made rn accordance with the specifications and conditions of this Agree-
ment and to ~rerify that the conditions of this Agreement are being carrYplied with, provided that
such inspection shall not interfere with Owner's normal business operations.
D. The Owner shall annually make a certifcation in writing to the City Council, on
yr before dune l ~c of each year this Agreement is in effect that certifies that the Owner is in com-
pliance with each applicable term of this Agreement.
IV.
OE~EI~AL PROViION
A. The City has determined that it has adapted guidelines and criteria governing tax
abatement agreements for the City to allow it to enter into this Agreement containing the terms
set forth herein.
B. The City has determined that procedures followed by the City conform to the re-
quirements of the Code and the Policy, and have been and will be undertal~en in coordination
with Owner's corporate, public employee, and business relations requirements.
The Premises are not in an improvement pro jest financed by tax increrrient bonds,
~
i a6v, -T
D, Neither the Prerr~ises nar any of the Improvements covered by this Agreement are
owned or leased by any rr~et~ber of the pity auncil, any member of the pity Planning and ~on-
ing ammissian of the pity, ar any n~en~ber of the governing body of any taxing units joining in
or adopting this Agreement.
In the event ofany conflict between the pity zoning ordinances, or other pity or-
dinances ar regulations, and this Agreement, such ordinances or regulations shall control.
~4
EFFECT ~F SALE, AINMENT, DR LEASE ~F PI~DPRTY
A. The Abatement with respect to the Premises, including any tangible personal
property located on the Premises owned by owner, shall vest in owner and shall be assignable,
with pity approval, which shall not be unreasonably withheld, to any individual, partnership,
joint venture, corporation, trust or other entity irrespective of whether or not such assignee is
related to ar aliated with owner} which acquires title to the Premises. Any assignee of owner
or any assignee of a direct or indirect assignee of Dwner shall be treated as "owner" under this
Agreerr~ent, No assignment shall require the consent of pity if the assignment is to a wholly-
owned subsidiary of the owner or to a subsidiary of Aldi Inc,, the owner's parent company, ar
if, following such assignrrxer~t, the owner continues to occupy and operate the ~antemplated Im-
provements for the full terra of this Agreement. Nor shall the consent of the pity be necessary if
the assignee agrees to fully comply with the terms and conditions of this Agreerrlent.
VI.
NOTICE
All notices called for ar required by this Agreement shall be addressed to the fallowing,
ar such other party or address as either party designated in writing, by certified mail postage pre-
pare, by hand delivery or vla facslrnlle:
~wNEI~. CITY,
Scott w. I~uslt Cearge Campbell, City Manager
Vice President City of Denton
Aldi Texas} L.L.Q. 21 East 1VIcl~inney
1517 centre Place Drive Denton, Texas 7~2U l
ulte 2~a Fax N0. ~4a.349.559~
l~ ax Na. ~94~) 44Z-b7S4
u~~~ ~
1armyi
r
VII.
CITY COUNCIL AUTI-ID>~I~ATIDI~
This Agreement was authari~ed by the City Council by passage of an enabling ordinance
at its meeting on the ~ 1st day of August, ~0~7, authorizing the Mayor to execute this Agreement
on behalf of the City, a copy ofwhieh is attached hereto and incorporated herein by reference as
IJxhibit ;;C~~
VIII.
BDARD DF DIRECTOR AUTH~RI~ATI~N
This Agreement was entered into by Owner, pursuant to authority granted by the Board
of Directors of its ultimate parent, Aldi, Inc,, an Illinois corporation, as authorised by corporate
resolution to execute this Agreerr~ent on behalf of Dwner; a certificate evidencing such resolution
and consent is attached hereto and incorporated herein as Bxhibit "D" as if written word for word
erein.
I~,
I~~BRABIII*,TY
In the event any section, subsection, paragraph, sentence, phrase or word is held invalid,
illegal or unconstitutional, the balance of this Agreement shall stand, shall be enforceable and
shall be read as if the partles lntended at all tunes to delete said invalid section, subsection, para-
graph, sentence, phrase, or word. In the event that ~i} the term of the Abatement with respect to
any property is longer than allowed by law, or iii} the Abaterrient applies to a broader classifica-
tion of property than is allowed by law, then the Abatement shall be valid with respect to the
classification of property abated hereunder, and the portion of the term, that is allowed by law.
BTOPPBL CERTIFICATE
Any party hereto may request an estoppel certificate from the other party hereto o long
as the certificate is requested in connection with a bona fide business purpose. The certif ieate,
which if requested will be addressed to the Owner, shall include, but not necessarily be limited
to, statements that this Agreement is in full force and effect without default for if default exists
the nature of default and curative action, which should be undertaken to cure sarne~, the rerrzain-
ing term of this Agreement, the levels and remaining term of the Abatement in effect, and such
other rr~atters reasonably requested by the party~ies~ to receive the certificates.
I.
OwNI~R TANDINO
Owner, as a party to this Agreement, shall be deemed a proper and necessary party in any
lltlgat~on quest~oning ar challenging the validity of this Agreement or any of the underlying or-
~
v ap, v
dinances, resolutions, or pity council actions authorizing same and owner shall be entitled to
intervene in said litigation.
XII,
APP~,I~ABLE LAw
This Agreement shall be construed under the laws of the state of Texas and is fully per-
formable in Denton bounty, Texas, Venue for any action under this Agreement shall be in Den-
ton bounty, Texas.
VIII.
RECORDATION ~F A~I~~NT
A certified copy of this Agreement in recordable form shall be recorded in the Deed Re-
cords of Denton bounty, Texas.
XIV.
1VCUTUAL A~ITANCE
City and owner agree t~ da all things reasonably necessary or appropriate to carry out the
terms and provisions of this Agreement and to aid and a~i~t each other in carrying out such
terms and provisions, Owner and City agree at any time, and from time to time, to execute any
and all documents reasonably requested by the other party to carry out the intent of this Agree-
ment.
XV.
1~NTIR~ A~RE~NT
This instrument with the attached exhibits contains the entire agreement between the par-
tieswith respect to the transaction contemplated in this Agreement.
~VI.
BINDING
This Agreement shall be binding an the parties and the respective successors, assigns,
heirs, and legal representatives.
X~II.
~UNTERPART
This Agreement nay be executed in counterparts, each of which shall be deemed an orig-
inal, but all of which together shall constitute one and the sarr~e instrument.
raga f
VIII. ETION AND OTHER HEADING
section or other headings contained in this Agreement are for reference purposes only
and shall not affect in any way the meanrng or rnterpretatxon of this Agreement.
I.
NO JOINT VENTURE
Nothing contained in this Agreement is Intended by the parties to create a partnership or
joint venture between the parties, and any implication to the contrary is hereby disavowed.
# i1
AI~ENDIENT
This Agreement may be modified by the parties hereto to include other provisions which
could have originally been included in this Agreement or to delete provisions that were not orig-
inally necessary to this Agreement pursuant to the procedures set forth ire Title 3, chapter ~ 12 of
the bode.
~I.
FORE MAJEURE
If, because offlood, fire, explosions, civil disturbances, strikes, war, acts ofC~od, or other
causes beyond the control of either Party, either Party is not able to perform any or all of its obli-
gations under this Agreement, then the respective Party's obligations hereunder shall be sus-
pended during such period but for no longer than such period of time when the party is unable to
perform,
This Agreement is executed to be effective 3~ days aver the executed date of the 21 ~c day
of August, ~D~7, the "Effective Date"} by duly authorized officials ofthe pity and Owner.
PAED AND APPROVED this the ~ da of 200'. Y
PERR . l1~IcNEILL,IVIAYOR
ATTEST.
JENNIFER VAI~TER, CITY ERETARY
~Y:
Dann ~
i a6v~.;; 0
APPI~~ED A T~ LEGAL FARM:
EDWIN M. SNIDER, CITY ATTORNEY
BY:
ALD~ ~TE~AS} L.L.Q.,
A Texas I ire ited I iabi lily company
By: ALDI INS. ~DELAwARE),
A Delaware corporation,
Its Sole N[ember
By
Scan . I~uka
Dice President
ATTEST:
~ f
n~~~ n
ap.,
s.laur do~umentslcantractsl~7laldi tax abatement agreement.dac
STATE OF TEAS ~
DUNTY ~F DENTIN ~
Before me, the undersigned authority, a Notary ~'ublie in and for said gate of Texas, on
this day personally appeared Perry R. McNeil, Mayor for the pity of Denton, known to nee to be
the person mho signed and executed the foregoing instrument, and ackne~edged to nee that this
instment ura executed for the purposes and consideration therein expressed.
lien under nay hand and seal of off ce thl the da of Au ust 20~~.
Y g
+ `1 t~tv Mace Texss N Pu ie ~n and for the
.y ' = My Commi~s~or~ ~xplrea Mate Of Texas
y arnr~lon Expcres: 1 C~
Pa i ~
--o-
STATE ~F T~~A ~
C~UNT'~ ~F I~~NTN ~
Before me, the undersigned authority, a Notary Public in and for said State of Texas, on
this day personally appeared Scott w, Husk, 'Vice President of Aldi Inc, Delaware}, a Delaware
cQrporativn which is the sole member of Aldi Texas} Ia,l~.~,, Texas limited liability company,
knawn to me to be the person who signed and executed the foregoing instrument, and acknowl-
edged to me that this instrument was executed for the purposes and consideration therein ex-
pressed.
C iven under rrxy hand and seal of office this the day of August, X007.
,,,~~~a~~~~, srovE~
, r ~or~~ ~~~i~~, ~tat$ ~~x~~ Notary Public in and for the
~y Cammfss~~n ~xpir~s ' ~ State of } F~~rua~y ~~1 i
~.~~r~~Fyil~~~ - OmIn1SS10n ~x gyres: ~o~ ~ ~ ~I
U~~~ 1 l
1 GI~L 1 1
EH~B1T ~`A~'
~R~~E~TY D~RIPT~~N
~E-~NI~ETI~ENT ~~NE ~f~. lil
If~INO A ACRE TRACT OF LAND SITUATED IN THE fLLIAM NEILL UR11f Y,
AISTRACT NO. 970, fiHE JOHN EACON SUR1lEY, ABSTRACT NO. ~ _ 40, THE
ISAAC N. HAMBREE SURVEY, AETf~ACT NO. X94 AND THE JEREI~H DALTON
SUR~IEY, ABSTRACT NO.353, CITY OF DENTON, DENTON COUNTY, TEAS AND
BEING A PORTION OF THAT CALLED 2949.99 ACRE TRACT OF LAND
DESIGNATED AS "TRACT NORTH TRACT" IN THE DEEDS TO SLF [i COLE PROPERTY, L.P~ RECORDED IN COUNTY CLERIC'S FILE NUIVII~EI~S 2D~5-~~~~~,
2005-~ 2277 AND 20f~5-~ 2218 OF THE DEED RECORDS OI~ DENTON COUNTY,
TEAS, ~DRf~CT}, SAIf] 120 ACRE TRACT OF LANE] f3EfN0 MORE PARTICULARLY
DESCRIBED FOLLOIS~
BEOINIVINO AT A 112-IfVH IRON ROD FOUND FOR THE SOUTHEAST CORNER OF
THE SOUTHEAST AIRPORT ADDITION, AN Af]DITION TO THE CITY OF DEIVTON
DESCRIBED BY PLAT RECORDED IN VOLUME O, PAOI~ 295, PLAT RECORDS OF
DENTOfV COUNTY, TEAS SAME 13EIfVO A NORTHEAST CORNER OF SAID 2D49,~D
ACRE TRACT OF LANE] AND BEING IN THE APPRO~CIfUTATE CENTERLINI~ OF 1ESTCOURT ROAD;
THENCE SOUTH 00°93'5" EAST GENERALLY ALONG THE Cf~NTERLINE OF SAID
JESTCOURT ROAf], A DISTANCE OF 1151.07 FEET TO A 518-INCH IRON ROD
FOUND CORNED IN THE APPRO~INiATE CENTERLINE OF SPRING SIDE ROAD;
THENCE NORTH 89°0'32" EAST ALONG A LINE IIV SAID SPRiN SiDI~ ROAD, A
DISTANCE OF 870.18 FEET TO A ~~~-INCH IRON ROD INITH~ CAP STAfUIPED ;`RPLS
4552" FOUND FOR CORNIER ON THE EAST SIDE OF UNf]ERINOOD ROAD;
THENCE ALONG THIS EAST SIDE OF AIf] UNDERIOOD ' ROAD, THE
FOLLOVIIIhlC:
SOUTH 00°5~1'~8'~ EAST, A DISTANCI~, OF 545.53 FEET TO A 5-INCH STEEL
POST FOUND FOR CORNER;
SOUTH 01°32'25" FAST, A DISTANCE OF 544.99 BEET TO A 5-INCH STEEL
POST FOUND FOR CORNER;
SOUTH 01°23'09" EAST, A DISTANCE OF 547.58 FEET TO A 818-INCH IRON ROD FOUND FOR CORNER;
SOUTH 00°42'7" EAST, A DISTANCE OF 344.0 I~fET TO A 112-INCH IROEV
ROD FOUND FORCORIVER;
THENCE SOUTH 89°15'29" V1~EST CROSSING SA1D UNDERVI~OOD ROAD, A
DISTANCE OF 125,95 FI~,ET TO A POINT FOR CORNER;
THENCE NORTH 54°18'23" ZEST, A DISTANCE OF 3017.$3 FEET TO A POINT FOR
CORf~ER IN THE EAST LINE OF THAT CALLEf] 31.107 ACME TRACT OF LANE]
~DOU~JIE~1ITLREEDYILO~~.~~ITempliCPgrpvui~el~xhibit A A1di Property ~~~cription,docPage ~ of 3
DESCRIBED IN THE JUDGMENT DEED TO THE CITY OF DENTON, TE~CAS RECORDED !N COUNTY CLERK'S FILE NUMBER 94-~~ , DRDCT;
THENCE NORTH ~7°5'48" UIfEST ALONG SAID EAST LINE, A DISTANCE OF ~~0.0~
FEET TO A ~1~-INCH IRON ROD FOUND FOR THE NORTHEAST CORNER OF SAID
,1 ACRE TRACT OF LAND SAME BEING THE SOUTHEAST CORNER OF THAT
CALLED 13.9 ACRE TACT OF LAND DESCRIBED iN THE JUDGMENT DEED TO
THE CITY OF DENTON, TE7~A5 RECORDED iN VOLUME 8~~, PAGE 1 7, DRDCT;
THENCE NORTH ~~°4'~ 1" EAST AT A CALLED DISTANCE OF 50~ FEET PASSING
THE NORTHEAST CORNER OF SAID X8,$9 ACRE TRACT OF LAND SAME BEING THE SOUTHEAST CORNER OF THAT CAL~.ED 24.E ACRE TRACT OF LAND
DESCRIBED 1N SAID JUDGMENT DEED TO THE CITY OF DENTON, TEAS
RECORDED IN VOLUME 87~, PAGE ~7, DRDCT, CONTINUING ALONG EAST LINE
OF SAID ~4.~~ ACRE TRACT OF LAND iN ALL FOR A DISTANCE OF 7D~.05 FEET
TOA ~I~~INCH IRON ROD FOUND FOR CORNER;
THENCE SOUTH ~°34'~~" EAST CONTINUING ALONG SAID EAST LINE, A
DISTANCE OF ~44.fi4 FEETTOA X12-INCH IRON ROD FOUND FOR CORNER
THENCE NORTH ~~°3'42" EAST CONTINUING ALONG SAID EAST LINE, A DISTANCE OF 29.9 FEET TO A 11~-INCH IRON ROD FOUND FOR THE
NORTHEAST CORNER OF SAID 24.E ACRE TRACT OF LAND AND BEING iN THE
SOUTH LINE OF THE AFOREMENTIONED SOUTHEAST AIRPORT ADDITION;
THENCE NORTH 88°4~'~7" EAST ALONG THE SOUTH LINE OF SAID SOUTHEAST
AIRPORT ADDITION, A DISTANCE OF 153.88 FEET TO THE POINT OF
BEGINNINGr
CONTAINING A COMPUTED AREA OF 1~0 ACRES, MORE OR LESS,
1VOTES:
BEAR~~f GS CALLED FOR NEREI ARE BASED 01V ~~E TE~CA
COORD~IVATE SYSTEM ~1~ORT~f CENTRAL 20NE~, A1~D WERE DERf QED
FR0~1 GPS OBERVA T~O~S O~ C1TY OF DETO~f ~ONCIE~S 1,
~0~~, X095 AND 2D~3.
A ~ S~CETC~f WAS PREPARED O~ EVEN DACE TD ACCO~fPA1VY ~T~15 DESCRfPTf 01~.
~:1DOC~JME~~ITLREEDYILOCALS~~IT~mpl~Pgrpwis~lExhibit A Audi Prope~y D~scr~ption.d~cPag~ ~ of 3
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Exhibit B
APPLICATION FOR TAX ABATEMENT
CITY ~F pE~TON, TEXAS
Property Owner A1di lnc.
Company or Project Name Denton Distribution Center
Mailing Address 7577 Centre pace Drive Suite 224
Denton TX 7B205
Telephone 940 442-G76~f Fax No. 940 44~~E784
Website www.afd~.com
Contact Narne Scot W. Huska
Title I/~ce President
Mailing Address 7517 Centre Place Drive SuRte 220
Qenton TX 7fi205
Telephone _ , 94Q1442-G7s1 ex~_~~ No." .940 442-fi784
Email Address aldit~xas sbc ~obal.n~#
2. Provide a ahronoiogy of plan# openings, cl~sirlg and re{oca#ions over the
past 15 years.
See Attachment 1.
3. Provide a record of mergers and financial restructuring d~rir~g the past ~5
years.
Not A licabl~
4. 111~i1~ the o~r~p~nt t~ .pr~'ect b~ o~rn~r ~r Ie? It are
~c~u~ncy ~ornm~tm~nt a~r~ady ~x~~,n~
O~v~r
. I the ~~o~~io~ of ~e~cit~ng fai~i or n~v f
tY ~~frt to ~x~a~d
~~~r~~~? ~ioa~i~t~ ~ yiv~ current ~~~ti~n.
~t i ~ ~w'~a~~l~ ~a e~c and o era#~ona. Thr' v~r~~l ~
A~.~I~ Head ~a~~r f~~ ~h~ t~t~ ~f T~~aa~
~f ~r~ xi~t~n ~~t~~ ~ui~~ ~~l ro'~c# r~u in aka
. p ~ nd~nrnent ~f e~~t~n~ fa~~~~ty? if of t~~ ~ci~ti~ ~i b~
~ I~ subtracted fr~rn the value a~ the r~e~r fc~~i to ~r of teal ~
p ~ a lue.
Nit ii~~~~e
P~~~e~Y ~ecript~an.
~Att~~h a ~~p~ ~f t~ ~ ~cri ~~c~ de~a~l~~ ra t
~ ~ ~ ~ ~ r~e~e a n ~ bound.
-Atch a mad ~f pra~ect including all rodvtir t
. Y t n~ ~ n~ ~~~~n~ with ~n ~~a feet of its.
Atta~h~~t ~ and fog #~e aho~r~# ~ d
~ ~ ~at~~f~ ~nstru~fed A~D~ fh~t th~~~ ~ta~hn~~nt ~ra~jd ui~e.
urrent 1~a1 ue. attach a ~a ~f stet PY prop t~~c tterr~~n~ ~rcm the
Dn~~n ~un#y ntral prai~i ~itci inciu~d ~ ~c~h rei and p~r~nal
~rc~e~ F
See Atta~hrnen~~ and
. Ir~crsd VItxl~it~ iota '
firucturc D~0 bite ~~v~o~ment 4
Pe~~na~ Pr~pe~ty ~ Other ~ m~ravemen ~ b~Eaw.
i
~LI~ u~f~~~f~on~ bud ~
~ numbers ~r ~~d on $ame
regent r~`e~t nt ~~ta~e. ~LDI b~~ieve tb~t the be
w~thlr~ ~ these etimt~~, The aut~ome an chap e
the
bu~~din end the~i~t~l ~ ~~E affe~tthofinal coy
ts,
~ 1nd~~~e a~ur~t ~f tai, ab~ment rid n~rnae~ of ea
~xr n g entity.
~~r~~~r~ ~r~l~~~ ~~~4
L~f and o~h~r f~nan~~~~ ~n~ent~~r~ ~~i ro'~ ~vill ~ ~
r ~ ~ ~ ~i~F
~~in~a~e~ fireepor~ ~xer~~~~~n !n ~8 tf1~ voters
o~ Texas ~ raved
~ ~ v~hiel~ earn tan ib~e ersona~ ra ~ tr~n
orted out
of the Skate o~ Texas w~th~n ~ ~ da s ~euld u~~~ for n ~ v~~er~m
eye tion. ~n aide r ual~ these erona~ re a ~
gut be d~t~~~e~ i~ Tess ~'o~ asseb~~~ st~~ "
~ ~~u~~~~u~~
f~br~~ti~rr r fer r~~ei~ ~ " ~t1 the lt~rn
must leave the tats af'~~~as r~r~th;n ~ ~ s frame the ~ ate the
wry u~Nr~ ~r bra ht into ~'~x~" Abe haw rov~d~ that
c~u~ties ~itl towns s~hoa! dlstr~et~ a " Md un~a~ eo~~e a ~~st~~cts
rr~a o t ~an~ ue to to these ~te~i o ~ ~ Renton ~e~t~
r
gun ~d the ~~nton ~r~de e~dnr~t ho o~ D~str~~t ado ~
The ~e rt ~me~d~nt qua c~e~t~ ~ , . ~ ~ T~ ~e ire ~ ~n~en#~ve
tool,
A~D~w~ll dlstr~but~ ~ rvxfmate~ ~~°o oft l e ~n~ento ~t~~r~
r
the staff of T'exa reu~~~~ era a fax ~~abili w A~~I ~u~~l
~ fore method o~ ~~~i~ ~iti~a c~a~
~ lec~~ie U~I~ 1n~~t~~ai ~~v~lepm~r~~ ~i~e~ ual' near and
ex~~r~ ~nd~#r~~l a~e~al service ~utornrs ma ~~ve ~
du~etio~ their demand b~~~~n . T~ ~r~~~t~~e availabte # those
u~tm~r e~ect~c serVi~ re reent~ d~rnnd not r~v~~us~
r~rd ~ the ~ ~t art locati~~ ~n the Ci service as ~n the it
~non#hs and where such demand ~ in ~I ~
~OO~C1l1~ ~r month. T ~ustoe uat receive service fro
~~~dL~~~1~ i~ ae~lel'ai eru►~e L~r ~ af~d ~ u~
~ ~i Denton ad valorem Saxe' and receive no eie~tMC service
discounts other tf~an those ecx~i~~~ d~~nd `rn the C
~ ~r~
ate sc~e~u~es, Tie r~o~th ~ dema~ ~ , ~ ~ ,
d b~ii~r~ wilt bead uteri
~cco~d~~ce w~tl~ tie ~ol~oin table;
~oduction tv Bailing of system Demand
~"ie ~e~iod ~ed~ctio~ to pea~d
Year ~f
Year ~~°l~
Yeas ~~°I~
Year ~ ~°l~
Year ~~~1~
Ai.~]I tit~d ele~tr~c demand ~aii~es fio
rthis ~trii rider. ALD~
1A1~~~ Clef ~hi~ 1"~de~.
~firr~a~etl 1111a~e~ll~I~ate~r~~er fnfrat~u~tu~e A~
11~ ~D Ooo
~ ~ . ire ~ hr~e~ de~r~ption the ctiv~t~~ to ~ .
i~ciudi~~ ~ de~~~~~an ef~~redu to be raduced . p ~ndl~r ervr~e t~ be
~rov~ded.
The D~nt~r~ Tx ~I~~I ~iviion ~~t~i~uti~~ ~ '
~e~t#~~ fir e~lv~n radue sh~i ~d fo AL.Di
tore ~ulth~r~ a ~5~ ml~e radius, ~4LD1 hay ~ fall r~~u~t
shl e~ ~o its distri~tttion center and then d'
se~~r~~tes t~re~ to ~
tires. The e~e~utlvn ~n~n~ event tea ~ d ~ . ,
~ d ~f~~c
stafif lncludln ~u orttaff ac~~u~rts ~ ~h~
e a~~~~,nts ~~~v~b~e
ae~~ut~ ~se~s#~~1 end shy ~d t~~ivi
r~ ~~erk~ oui~ r
~~t~ ~tthi~ ~~~li . This fe~li ~v~
u~d he the Weed uar~er
fir Texas o eratl~n~
P~~~e ~r~tru~on P#~e
~stirr~ate percenta~~e of te`e~ dev~
~ ~ ~pn~ent n~ ~r~tru~t~an doi I ~ he ~en# ~r~~h Benton hayed o
ntracter or sub oontrc#ar.
antruc#i~n ast ~ ~~0 ~ note on ~ther~
Parcenta~ Lo~a~ ~ant~actars one • • - ~Il..~l f~~li ~ a
4~ F ~lst~butlo ~ ~ent~~ ~n~ Re zonal Wead
A
1a a ~ui~d~~ inn ~i that most of the trades ~+r~~~ ~v h
~raiue ean~c, ~~t~ ALAI and ~L ~ refer to en ~ ~~~1
~~t ~1~~~~~~~ r~V 4 ~ i r~ fl a~td sea a t~l~
td ~'~orn teat ditan~es. ~ t ~~~t~at~ Nl~~~
~~e~ to staff ~ns~rr~ ~~nd finance cantraets ~~rue~ f~o~
'l.S to . ~i~~~~n. vales de ~ ~n the trade. A feuv
i
will be in the 250 000 ~v 500 000 ran e. rades such as slab
on rade dock e ui ment and refN erati~n are ve
s ecialized and ire so e cases sin (e sou e. These three
trades account for 2~°e off' the value of the work #hat we knew
wQll he from outside of pe ton, q, ~e~~n~ s dye of the
subcon~,ractor market in the Denton area ~vealed a maxi u
otentia! of 4Q% of local grades. This ass~m@s the coca! trades
are ca a61e and w~llin and abbe to er~o~ and are
successful bidders com e~Pn with outo~~low~ pFW and
be and ~vntractors. TF~is e~~r~ in ~h~ ro~ess a reason
Yle
estimate of robable local subs would be n the 7p°~~„2p%
• ~f
B. Construction EmpJoyrnent Estimates:
Start Date (Mo/Yr) 2f'112408
Completion Dale (MolYr) 81'112009
No, of Construction Jobs 17~
Estimated To#al Cons#ruction Payrgjf $ 7 80~ QOQ, TF~e
a roll ortion o~F #h~ trades is somethin ~e have ~o# #racked
and is s eculativ~.
C. Describe any o~ site infras#~ucture requirements:
*1Nater 8 000 lin~a~r feet ! off~ite waterline-
includes creatp~ ~ waterline loo be~eri the e i~#ir~
wate~l~ne at Westcourt and Corb~r~ Roads ~nd e~endin a
i
wa#~rl~ne aeon ~ ~ ~~ne a~ ~N~staurtlU n~e~o~
Reads.
s~tr n~t~ ~ffits#~t~an ~ • ~ ~f o~ fog mein ar~d
~ ~f of Zvi rnaR ~10~ l~Vt~our~ ord.
~tr~et ~~~d w~~~ b~ ~ ~~~rd fr~rn Air ark
~a~d tO t~~ oed A~~I r~ ~ n
~ ~nclud~ road
~ v~rn~n~s ~~on the irn~
~t
~t~o~~llJ~d~r►~id R~~ds;
*~r~n Drina ~ ~S~I~ wt~M des
~our# load
~av~rn~n
'~th~r . 0~ if f " na~ura~ ~
~~n ~sfio~~ R~~d
N~T~. Th~,~ntrnd so a of t~~
~ read ~rn~rov~~~ ~~~r~~ ~~~s~d ~I~.D~.
1. Projt ~pr~tian Ph~~.j ~ravid~ enn , p~eyn~ m~errn~tta r ~h~ number
~f e~~ ~r ~atn~~n~ i r ups#~d,
~ltch~~nt f A~~.
~~pes fobs cr~a~ed, ~ List # ~ ' • ~ dab end nur~ber os~t~ens ,
Bch cate~o ~~at i~~ be ! ~ ~ - ~ ~~l~y~ t the fac~~~ . Pr~~r~d~ ~~e
a e r~ ~~r ~~h ~~~e~r~.
~ - D~s# Niana ens ~ to ~ ~ ~nr~~al~
~ ~ ~#ie ~'ervnnei - ~8*~~ ~l~ou
a * ~r~h~us~ ~ _ nne~ ~ 1~,~o1h~u~ t ~ u ~o
t~ '~~.~~~h~~~~
4 - ~[ar~i~o~~ u ervis~ D
~~l~~n~a~l
7 or Z -Warehouse Mechanics , 50 OOO/annul!
'f Vice Presider~tl8 Directors _ Executive Wa e Level
The above are ro`ected wa es for 2009, All ~,D~ ersonnei
receive fuI! b~~e~~a includin med`ca1 dental vision disab~li
and life i~su~nce and alb of these art no cos# ~o the
em ~n ee The resen# cos# to add an er~tpire fam~~ ;s gg0,00
ert month. The cow ~n ~Iso contMbU#,~s to an
em ~o ee ret~remenE acka eR
G, ~s#imate annual utility usage for project (Daren Sealaver spoke to Linda Ratfifif-no need to ~!I this section out.)
. E~ectn~ Water
Wastewater Gas
74. Describe any other direct benefits to the City of Den#on as a result
of this project (e.g.,sates taax revenue or project elements identified
ire Tax Abatement Policy, Seatior~ fll).
7 Qro e Tai; gLp~~s o~o~ of roe 1~xes allocated to
the Denton Inde endent School Distract w~i1f rovPde a new
source of revenue for the local educational s stem.
~ Sa(es Ta ; A,LD! ma be ire a osit~oh to estap[ish a s~~es
#ax nexus wpthin the C~ o~ Denton which would serve as the
oint-of.s~le for buildin roducts as A~,p~ carries out ifs
business Ian of cor~structin retail o eratior~s across the
State of Texas. As a result oft is strata t~~ C, of Den#on
ma realize sales to co1lectiong based on these urchases.
3 New Errs ~o ee Salaries: ALDps Qistr€butio~ Center ~a~
to ~xri ~a ~ r~rnatei
~'hese nor ~~ar~es w~~~ af~eet the dal ~ena~ ~ art ~ ~I
do~~a ~~terin the busines~~ r~duci~ sods r~r~~ea
~n Benton Texa~~
4 ~r~ve~t T'a~: ~I~D~~a D'st~b~~on ~
me r v~~ l ~ ~~~r~ h ute
ood r~u ~~ut ~ Te~a~ rvice tsrr~to
~u~ to these
~~de mai~~~ in the staff the ir~v~nto ous
~ r~ the
~er~tn I~istribu~a ~nt~r irf be
for r~ a x
~n~~~d~n e~ c~~ur~ end ~ehea~
L~a~ Pnrchase, Al.~l~s i
'~h~#~~n ~ente~ ~'~~I re u~re
fia~da soda and ~r~~e ~ •
fn order fi a er~te and ~~~in
~ ~~r ~ fa~iii a roxirn~toi ~~0 ~~0
u~ re feed
~ ~leci Una ~~~~'s D~tributio
~ ~nt~r w~~! coneu~
e~eot~~i from Deg#a~ ~n~c~ a! ~~ec .
t~ ~suit~n ~t~ ~
frneh~e ~ ~~~t the s
ner~~ fc~~d~
~ dew fines par~C ~n~ratruofi~~e,
* A~~I s new bu~r~
s~~e viii result ~e~v infrastruo~u
~rn r~vemer~t~ that w~~l
~e~f~t overall b~s~n~ devolo ant for this ~e ~p~ of the
~ ~~ad carte fir Al~~I'a lea li~arket t#~ : This
root is ~ALD~'s fast foal rent to fihe o~ Teas. ~ a
~~i this ro'e ~vouid ~enr~ ~ the I~e~ ~o cat~a for A~~l's
1o n ~~e rowth s'~ate fo r es h~~h~n ~~rk~t ha ~r~ the
~
~ omrnurt~~y ~~va#~~mn~; AUDI her are ~~rt~~ in
~an~rib~t~~ ~ t~~ ~a~a~ ~arnmu~~ wow~~ ox ~or~
of interest ~n ~ of ~~~n.
1a. i Property za~~ prop~a~eiy'~ Yes ~ N~
current ~or~fr~. ~~-5
~on~n~ required fay ~ro~~se~ pro~ec~r
~n~icipated v~~in~. Not ~
~ ~ p~~p~rty ~laed? lies ~ ~
VU~~~ r~~ain~ be nece~~ry'~ Yep ~o
1 D~ou any ~nv~ranme~~al ir~pot c~est~~ this proje~~,
A~~~'a ~~str~~u~on ~r~ter ~ra~tld rent a~ n~~'o~ ~m ~a er
for tie ~ ~ e~ntan ~rh~c~ inta~r~ a~ la
~n~r~ron~e~t~ r~~o~d. ~ r~'e~t re rents are ind# ~n~
ern ~r on~ded ~r~rvnmen~~ ~ons~~en~~.
A. Lit snY permits for v~hzh P~lo~~~ m~~ apply, ~~cant P
vu~l~ be ~qu~~ to pr~~~ pity op~es of alb a i~oation ~P far ~nv~ronr~e~t~I p~rm~t upon omplet~o~ o~ ~ iica~or~ s .
pp ~ ~
its ~~~ni I.l~i~i ~ 1N#r1V~late 1~I~t~r~ 4 F~~w
E~~etrie* Bu~~~En Fl~or~~at~~ 7 ~~d ~ '
~~~~tion
~ L~r~ds ~ sneered for Fo~r~d~t~~n
Provide cord of e~rnpi~n~~ to sib ~~tvironmenta~~
re~ltien for past five years,
`his i ~ ~~w ~ocati~~ end ~he~ef~ i~ ~o~ ~ l~b~~
R
. ~ ~rav~d ~~~ific detail of are ~uineelre'd R Y ~ ants fiht mil be
d~spl~ end ~t~r~~ ghat wi~f be e~~i~~bi~ fra , . m the re~ut~ng
~r~~~y~
iioahle
Provide deo~pti~r~ of an hitor~c~~I i ni c . ~ Y ~ fi ant ~niu~d
wt~h[~ pro~ec~' a~o~ ~etermi~ed b ~h Hilo r ~'~C pre~rv~hvrl
~ffcr. any, gfrro det~~~ of hoer ~e h~t~~l fgr~~f ~a~t area w1i1
~e reerved.
I~ot A ~~c~b~
0. Ju~~~t~~n far Tax bt~~rent e .
~ ~~t. ub~a~~~a~~e ~n~ more
o~~ribe ju~ifi~t~orr for ~h~ ~~t q . include the rnount
of the a~m~t requed end show hour i~ wiif oo i ~trib~to ~ the
~r~~noial viabil~#y fthe pro`ec~, ~t~rnit a~tao ~ hm~nt ~f neoos~ry,
~ 1"he North T~~~~ site ir~oiu~~ hi hog
than
~rn ~titiva site the oom i
~rfo ~r~ dui d~~~ erne on~
The ~~t on~rou~ ~ ~n~ in~iu~ tho .
h~~ rae tai
~~vi a a~~t ~r, and a ~r~~l r~ ~ -
. ~I~.~f to fnvet
~ t~ ~n~~ii~n in ~~-~f-th~Aa~ ~itr~b~a
t~o~ tenter v~~t~
Texas hound ~nv~nt~ Thy ~ R
~x one T~x~
~n an~i~corn et~ti~e cam ~ •
nett the r~ eon
~ The ~~t~ i ma~~ un~~~rel~ ~d an
~ w~~! ~~n~ e~te~~vo
infra~t~~t~re u ~ and ~~veman R
* Thl ~r~[~~1t~n~~
r~ sires ALAI t~ mal~a u~~ ue fnv~t
~~nts vr~ts~d~ ~fth~
f~nar~ei~~ ~nvd~~ fir ~ n~r~ Df~t~i ~t~t~or~ Ce~t~r, A uh~~~ ~n~a~e
~~h~ aid in ~n r~strc~ctur~ r~ r • ades this aila~r~~
Ai,D~ t fv~r~s its r'rma ~~1vte ~t ~ rat ca stru~~t~ n a
~af~ ~r~d yam e~t~~ stru~t~u.
4 r
h the ublic~ rlv~ ~~nerhi ~~I will also
f~~low ~h anrr an ' ~~n~~al m~d$I ~~v~tin in h~r~r~
~~~i ern Iv ee~ a d ~~in cans ~t~~i~r~ ~ ~ f r Ohl
ind~t . L~w~~ ~#+u c~ t~~~~t inta ~ 1'~'11.~~1!
l~ve~ ~~r ~h8 ~~~r~rn.
~ ~"h~ ro"pct ter~to fay ELI end fie ~ i r~b~~~on
~n#~ri~~v~i~~ the ~~a a f~~I~unchlrt ~~~I 1~exs
~fr~ ~ ALI~~ fe~~~ ~~xa will ~ Iron rear et k ~~r
its r~#il c~nte ~n~ thl irwe~trn~n will ~ . ~ # ~t~tr~
Bch a new ~n~~avor~
J~LD~ ~vi~~ ~l ~~h new ~m o -
I undo ~ ~~n~ ~n
trlnln . ~h~ tralnfn w~~~ ~m ~o~re ~~h ~m I~
- ins v AI.Df#~ hence fir i f~~~
new rna ~ ice,
. Llt ad~i~~n~l ab~~~r~~n~ f~tor t~
c~nsr~er~d #h~~ pr~~et ~ ~~#lln~d on peke - ar~d ~ of ~ T~~ ~Ib~men~
lacy.
the ro"~~ will inv~~rr~ ~ l ~~~~nt rela "
~~r~sh~ w~f ~n~ of
the two ur~~rerlt~e ~ D~~t~ni ~fi ~e~st
of the new
crewed ~ #h r~"~f will be ~~I~~ ~ De "
~~~n rcrde~t"'~~~
ro'e# will r~v~d~ kn~wfed ~ae~ "off
~ I~~st ~ ~rc~nt
of '~b~ ~ olle~ ~ b~~h~l~r~ de
of ~~t I~vel.
F~na~~i~l f nfc~ti~n: ~it~ch co a
PY ~th~ l~~est ~u~~te~ finan~~ #~te~r~t ~r, In the~c~~ ~f ~ n~~v ra'ec~
~ ~ ~ ~ ~u~n~ p~~n.
1e v~ri~l d~~u~ am ext~n~~r~ ~nnci~f d ' ~ verbai~ wffh
consultants as directed b t e ~i of Demo ~Ganvm9c
Develo mend ALD! is a rivat~ com an end does not release
its financial sta#ement~ do the ublic,
This tax abatemen# 2~ppfication is submitted witf~ the ac~cnow~edgement
that addi#ional certified financial ir~fom7ation may be required.
AcrEhorized Signature
Q'
Date
i
r
aiV~~N AngRE aA~E ~P
Aldi ~ Bsvj~ D~visEon ACRE ~ ~~f~ ~l, l~~k l~~ad, Bavia, I>~ G05~4-~~47'7 ~1~~}19 ~ ~4
alai - Burli~o~r Di'vlsier~ ~ 44~ ll~t, ~Is~~#~ ~~~~t, ~u~i~gtot~, !A ~i~D~
A~dj - re~nv~aod D~ris~o~ ~ ~ 4~~ ~t Stop ~ ~ load, r~eenv~od, f N 4~ !'i
Audi ~ ~'E~~f1on Division 4~~ Peari Diva, ~'~~11p~, ~
Alai , H~~~kx l~ivisio I~~~1 9~ 82 n ~ ~ 9 vilest ~ 3~t~ I~t' ~tr~oy, ~i`i 44~~ 71~41~ ~ 9 Aldo R ~~iso Division East Division ~d,
V~l~~raiso lf~ 4~8~
~idj ~ ~ f~~ld Division ~ I~~~ 9~~ 88,E
~ youth l~a~i#on Pi k~, pr~n field, ~N 45~ 7~~ 1~ X93 Audi , Veil Division 270 auoo~ ~~,5
F Valle Road+ ~~nt~r Valley, E'A ~ l~ ~ ~ ~ldfi - ~a~ irk Division 9~ vuth 1 Strom, ~~k roek, Ilvl ~3~ 54
~l~~l~ ~~S ~ 0~,~ ~di A Tilly l]lviion ~D #~ta Rt , Tull , f~lY ~ ~ ~9
Aldo - ~leth~ f~~visl❑ ~'i ~!5!~ 8 ~ n ~ ~~~5 S. l~? hlthway, OEat~e, lC 6~0~ ~ ~~~~I~ 998 ~
~ldj - Salisbury Division ~ X85 old Uniol~ I~ur~h R~a~, a~isbu ~ ~8~48
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t
ALDI Inrv. Corporate Finance&AdfT~~nistration
1200 North ftirk Road del: X30181"9-S~r~o
Batavia, fl X0510-1477 FAx: 6301H79-9901
AUDI INC.
C~ RTI FICATF of RESOLUTION
lynn A. J~oser, do hereby certify that I am the A~~istant
Secretary of Aldi Inc. and that the following is a true copy of ~ resalutiorf
duly adopted by the Board of Dire~ters of said corporation by unanimous
written consent dated~February to,1998.
~ESU~VED, that the Chairman orthe President
of Aldi Inc, is hereby authorized to execute real
estate transactions, including but not limited to
purchase or sale contracts, on behalf Aldi If~c.,
or to a~ign the au#hority to execute real es#a#e
transactions f or specif i~ properties.
_ August ~ 0. ~UO1
gate Lynn A. Maser
Assists nt secrets ry
1
a
..r ALDI ~r~c. Cor~ar~te Finance &Administratior~
1~OD North Kirk Road Tel: 630!879-8100
~ ~ Batavia, I~ 6010-1471 SAX: 6301$79-9901
As provided for in the ~or~orate resolution dated February ~ 0,1998, I, Charley Yaungstram,
President of Aldi Ins. ~utharize S H
to execute all necessary documents related to the property generally described
5 A I~ T x Abat m n A r f r h n T]C
August 1a, ~OD7 ~ ~ .
Date Charles aungst orn
President
~ s:laur documentslardinance~~~$laldi tax abatement agr ard.dac
L
EXHIBIT 3
ORDINANCE N~~
AN ORDINANCE THE CITY ~F DENTIN AUTHORI~IN THE MAYOR T~
EXEC~JTE AN AMENDMENT T~ THAT CERTAIN TAX ABATEMENT AGREEMENT
WITH ALDI ~TEXA} L~L.C. APPR~~ED BY THE CITY C~UNCtL ON A[JC~DT ~l, 207,
BY PR~"VIDIN THAT, A A C~NDITI~N OF THE ABATEMENT, ALDI SHALL
C~NTRUCT A CERTAIN PORTION ~F wETCOURT READ TO PECIFICATI~N .
ACCEPTABLE TO THE CITY OF DENTON AND FI~RTHER PRVID~NC THAT THE
C~NTRUCTION ~F wETCOURT RDAD SHALL BE COMPLETED AND ACCEPTED
BY THE CITY ~F DENTIN PRIER T~ THE 1S~JANCE ~F TAX ABATEMENT BY THE
CITY ~F DENTON; PR~VIDINC~ FAR A E~ERABILITY CLAUSE; AND PROVIDING
AN EFFECTIVE DATE.
wHEREA, an August ~1, Z~~7 the City Council approved a Tax Abatement Agreement
~exlst~ng agreerr~ent} wlth Aldl Texas} L.L.C.; ar~d
wHEREA~, the Agreement required ,Aldi to construct westcourt Road, frorrz Airport
Road south to pringside Road ~a distance of approximately 4,2~~ linear feet} as a two-lane,
concrete road to specif cations acceptable by the City of Denton; and ~
'HEREA, the construction of estcourt Road was required to be completed and
accepted prior to the issuance of Certificate of Occupancy by the City of Denton; and
V~HEREA, due to condlt~ons beyond the control of Ald1, the design and construction of
~Vestcourt Road may extend beyond the completlon of the Aldl dlstrihutlon faclllty; and .
. r
~VHEREA, the Econorn~c Development Partnership Board recommends Aldi be
permitted to obtain its cer~if irate of accupanc upon carripletion of all other required
construction, except the construction of westcourt Road; and
~VHEREA, the Economic Development Partnership Board recommends the granting of
tax abatement be withheld until completion of construction of westcourt Road in lieu of the
Certlflcate Of occupancy; NOw, THEREFORE,
THE CITY COUNCIL OF THE CITY OF DENTON HEREBY ORDAIN;
SECTION l . The findings set forth in the preamble of this ordinance are incorporated by
reference into the body of this ordinance as if fully set forth herein.
SECTION 2. The City Council approves the withholding of the tax abatement until
completion of construction of estcourk Road in lieu of the certificate of occupancy,
E ECTI~N 3. Notwithstanding any Cade provisions to the contrary, the Building .
Official is empowered to issue building permits and certificates of occupancy for the proposed
Distribution Center, prior to the completion of estcourt Road, provided that Aldi Texas} LLC
has deposited v~rith City sufficient funds to secure such road construction.
s:lour ~acumentslordinancesl~Slaldi tax abatemcnt agr ord,doc
. i
{
ECTI~N 4. That if any section, subsection, paragraph, sentence, clause, phrase, or
v~ord in this ordinance, or application thereof to any person ar circumstance Ys held in~ralid by .
any court of corrlpetent jurisdiction, such hal"ding shall not affect the val~d~ty of the rerr~aining
portions of this ordinance, the City Council ~f the City of Denton, Texas, hereby declares that
they v~auld have enacted such rema~nrng portions despite any such Invalidity.
SECTION Thls ~rdrnance shall become effectlve irrirr~edtately upon Its passage and
appro~~al
PACED AND APPR~V~D this the day of , Z~oS.
PERR R. cNEILL, MAYOR
ATTEST: c
JEN~1~'ER SALTERS, CITY EC~ET~RY
i
APPRO D ~ T LEGAL FARM:
FDIN . NYDER, CITY ATT~RNE~
EY:
i
r
F
~
Y
s:lc~ur doc~rnentslcontracts1~81a~di amended tax abaterncnt-westcourt rd.dac
AI4~IENDENT T~ A TAB A~ATEIVIENT AGREEMENT
BETwEEI~ THE ITS DENTIN, TEAS
AND ALDI ~TE~A~ L.L.,
This Amendment to the Tax Abaterr~ent Agreement the "Amendment"} is made and entered
into as of the effective date provided far below, by and between Aldi Texas} L.L.C., Texas limited
liability company ~"Aldi"}, and the CITY ~F DENTIN, a Texas municipal corporation the "City„},
for the purposes and considerations stated below;
wHEREA, on August Zl, Z~07, the City Council approved Tax Abatement Agreement
with Aldi ~Texas~ L.L.C. the "Existing Agretrrer~t"~; and
wHEREA, the Existing Agreement required Aldi to construct westcourt Road, firarri Airport
Road south to pringside Road ~a distance of appraxirrzately 4,~~~ linear feet} as a t~vo-lane, concrete
road to specifications acceptable by tl~e City of Denton; and
wHEREA, the Existing Agreement requires that the construction of westcourt Road ~s to be
carrtpleted and accepted prior to the issuance of a certificate of occupancy by the City of Denton;
and ~
wHEREA, due to conditions beyond the control of Aldi, the design and construction~~,of
westcaurt Road tray extend beyond the date of completion of westcaurt Road; and
wHEREA, the Economic Develapm~nt Partnership Board recommends Aldi be permitted to
obtain its certificate of occupancy upon completion of all other required construction, with the
exception ofthe construction ofwestcourt Road; and
s
~VHEREA, the Econarr~ic Development Partnership Board recan~mends the granting of tax
abatement be withheld until completion of construction of westcourt Road, and that the certificate of
occupancy not be cand~ttoned an the completion of construction of westcaurt Road; , t
1VOw THEREFORE, the City and Aldi ~Texas~ L.LC. covenant and agree s follows:
1. Paragraph I.F of the Existing Agreement is hereby amended as follows: "A condition of the
Abatement is that the owner shall construct westcourt Road, from Airport Road south to
pringside Road ~ distance of approximately 4,~a0 linear feet}, as one~half of a secondary
arterial concrete rand and to speclf~catlons acceptable by the pity of Denton. such
construction of westcourt Road must be completed and accepted prior to the issuance of tax
abaterr~ent by the City of Denton. ~n addition, owner agrees to enter into an agreement with
the pity of Denton for the construction of westcaurt Road prior to receipt of owner'
buildin ermlt and to de asst funds, to be held b the Cit , in an interest bearin account, for gp P y Y g
said construction from which owner tray draw to pay its contractor yr from which the ity
may draw far the purposes of building westcaurt Rand in the event that owner fail to
construct westcaurt Road within arie ~l} year after receipt of owner's certificate .af i.
r r~ { ~ t
• i r
~ L1
r~
i
s:laur documentslcanttact~l~$laldi amended tax abatement-wes#e~urt rd.da~
occupancy. Construction of V4~estcourt Road shall not be a condition to the issuance of a
Building Permit or Certificate of occupancy by the City of Denton."
2. All other terms and conditions of the Existing Agreement shall remain in full force and effect.
3. Th1s Amendment shall be effective as of the last date of slgnature of a party as lndreated
below ~"The Effective Date"}. _ .
CITY OF DP1T~N, TE~.AS
C'
BYE
PERRY cNE~LL, MAYOR
DATA. ~ ~ ~ ~
ATTEST:
JE~VI~IT~ER wALTE , CITY SECRETARY
B.
APPROVED A TD LBC~AL F~RNI:
~DwIN NI. NYDER, CITY ATT~RI~P~Y
BY;
ALDI ~TE~A} L.L,C,
A Texas lirrlited liability company
BY; ALDI INC. ~DELAwARE}
A Delaware corporation, .
dole Merr~ber
BY: '
C~TT I~U~.A, Vice President
DATP~;
ATTEST:
Page ~
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: Planning and Development
ACM: Fred Greene, 349-8351
SUBJECT - A07-0006 (Hills of Denton North Annexation)
Hold the second of two public hearings to consider, under the annexation procedures for areas
exempted from the municipal annexation plan, the voluntary annexation and service plan for
approximately 484.84 acres of land located west of Locust Street (FM 2164) and south of Milam
Road, see Exhibit 1. The Planning and Zoning Commission recommends 7-0 that the public
hearing for A07-0006 is held as scheduled.
BACKGROUND
Applicant: Spring Brook Planning Group Grapevine, TX
An annexation proceeding is being considered by the City of Denton for approximately 484.84
acres of land located west of Locust Street (FM 2164) and south of Milam Road. The subject
annexation area contains 26 parcels and is currently developed as Agriculture and Rural
Residential.
On April 3, 2007, the City annexed approximately 1,198 acres of land which is now part of the
Hills of Denton, located south of the subject annexation area. Following the annexation, on July
17, 2007, City Council approved the Hills of Denton Master Plan Community (MPC). The
applicant of the Hills of Denton MPC is the same as the applicant for the subject annexation.
The intent of the applicant is to annex the property into the City and then process an application
for a new MPC called Hills of Denton North.
The following items summarize the proposed annexation and important actions taken:
■ On April 1, 2008, City Council held the first of two public hearings.
■ On March 12, 2008, Planning and Zoning Commission held a public hearing regarding
t e propose annexation.
■ The subject property proposed for annexation is located within City of Denton's Extra-
territorial Jurisdiction (ETJ) and is not zoned.
■ The Comprehensive Plan identifies this area to be within a Rural Areas and
Neighborhood Centers land use designation.
■ The annexation is scheduled for completion on June 17, 2008, see Exhibit 2.
In accordance with the City's annexation policy plan, approved in June 1993, the City will
"assess on a case by case basis the annexations of areas in the ETJ when significant
developments are proposed." Annexation should be considered when a property is located
within the designated urbanizing area; is expected to accommodate urban growth in the next
twenty years; and if the annexation is contiguous to existing city limits, city roads and rights-of
way. The subject site is located in Demon's ETJ Division 1. As such, development is subject to
only the City's subdivision regulations and not zoning regulations. The subject property is not
within a platted lot; any subdivision or reconfiguration of the subject property will be subject to
the City's subdivision regulations. Incorporation of this site into the City would not require
additional properties.
Public notification information is provided in Exhibit 4. As of this writing, staff has received
one response from property owners within 200 feet of the subject site. The property owner is
neutral to the annexation petition.
OPTIONS
1. Proceed with the annexation.
2. Amend the land area proposed for annexation.
3. Amend the Service Plan.
4. Discontinue annexation.
RECOMMENDATION
The Planning and Zoning Commission recommends 7-0 that the public hearing for A07-0006 is
held as scheduled.
Staff recommends that the public hearings proceed as scheduled, finding that the need to manage
and coordinate development in an orderly manner is a significant city objective that the City of
Denton will pursue.
PRIOR ACTION/REVIEW (Council, Boards, Commissions)
March 12, 2008 Planning and Zoning Commission Public Hearing
April 1, 2008 First City Council Public Hearing
FISCAL INFORMATION
Development of this property will increase the assessed value of the city, county, and school
district. It will require no short-term public improvements that are the responsibility of the city.
EXHIBITS
1. Location Map
2. Annexation Summary Schedule
3. Service Plan
4. Service Area Analysis
5. Notification Information
6. March 12, 2008 P&Z Minutes
7. Responses to Public Hearing Notice
Prepared by: Respectfully ,submitted: i]
~ ` ~ `
Mark Cunningham, AICP
Planning Supervisor Director of Planning and Development
EXHIBIT 1
LOCATION MAP
f
_ y - -
~ ~i
i - ~ ~
M
1
I
~I
I ~
l
r
.ti
I
EXHIBIT 2
ANNEXATION SUMMARY SCHEDULE
Hills of Denton North Annexation
Notices to Intent to Annex will be sent on February 8, 2008.
Tuesday, 4/l/08 City Council conducts first public hearing.
• Public notice must be no less than 10 days and no more than 20
days before public hearing.
❑ Annexation Study prepared and available for public review.
❑ Service Plan prepared and available for public review.
Tuesday, 4/15/08 City Council conducts second public hearing.
• Public notice must be no less than 10 days and no more than 20
days before public hearing.
Wednesday, 3/12/08 Planning and Zoning Commission public hearings -make a
recommendation to City Council regarding the ro osed
annexation.
Tuesday, 5/6/08 City Council by afour-fifths vote institutes annexation
procee ings.
First reading of annexation ordinance.
• Action must be more than 20 days after the second public
hearing but less than 40 days from the first public hearing.
Sunday, 5/11/08 Ordinance published
• The ordinance cannot be acted upon until at least 30 days after
publication.
Tuesday, 6/17/08 City Council by afour-fifths vote takes final action. Second
readin and adoption of the annexation ordinance.
• Council action must be more than 30 days after publication of
ordinance and less than 90 days after council institutes
annexation proceedings (adopts ordinance on 1 St reading). The
second reading of the ordinance could be held any time
between June 10, 2008 and August 9, 2008.
Annexations must be rigidly coordinated in conjunction with the City Council public hearing
schedule due to specific timing mandates established by Texas State Law. The Texas Local
Government Code requires that City Council institute annexation proceedings (1St Reading of the
Ordinance) more than 20 days after the second City Council public hearing but less than 40
days from the first City Council public hearing.
EXHIBIT 3
CITY OF DENTON SERVICE PLAN FOR
A07-0006 Hills of Denton North Annexation
I. AREA ANNEXED
The annexation area is located west of Locust Street (FM 2164) and south of Milam
Road.
II. INTRODUCTION
This service plan has been prepared in accordance with the Texas Local Government
Code, Sections 43.021, 43.065, and 43.065(b)-(o) (Vernon 1999, as amended).
Municipal facilities and services to the annexed area described above will be provided
or made available on behalf of the City in accordance with the following plan. The
City shall provide the annexed tract(s) the levels of service, infrastructure, and
infrastructure maintenance that are comparable to the levels of service, infrastructure,
and infrastructure maintenance available in other parts of the city with similar
topography, land use, and population density.
III. AD VALOREM (PROPERTY OWNER) TAX SERVICES
A. Police Protection, and Animal Control
Police service, including patrolling, response to calls, and other routine
functions, will be provided to the property upon the effective date of the
annexation using existing personnel and equipment. Code enforcement
and animal control services will also be provided to the property upon the
effective date of the annexation.
B. Fire Protection
Fire protection (within the limits of existing hydrants) and emergency
medical services will be provided to the property upon the effective date
of the annexation. The estimated emergency response time in this area is 6
to 9 minutes from Station #4 located at 2110 E. Sherman and Station #5
located at 2230 W. Windsor. The City of Denton will provide emergency
medical services ("EMS").
C. Roads and Streets
Roads and streets, which have been properly platted, duly dedicated, and
accepted by the City of Denton and/or Denton County, shall be maintained
by the City of Denton on the effective date of the annexation. Installation
and maintenance of street signs, street lighting and traffic control devices will be maintained by the City of Denton on the effective date of the
annexation.
D. Parks and Recreation Facilities
Parks and recreational facilities in the area to be annexed will begin upon
the effective date of the annexation according to the 2000 Parks and
Recreation Master Plan. No parks are currently located within the
proposed annexation area. Denton neighborhood park facilities are not
within reasonably close distance of the proposed annexation area.
Residents of the proposed annexation area will be able to use existing City
of Denton park and recreation facilities and programs.
E. Library Services
Library services will be made available on the effective date of the
annexation on the same basis and at the same level as similar library
facilities are maintained throughout the city.
This annexation will impact the current level of library services provided
at the North Branch Library as it is in proximity to the service plan
request.
F. Building Inspections and Consumer Health Services
Building inspections and consumer health services will be made available
on the effective date of the annexation on the same basis and at the same
level as similar facilities are maintained throughout the city. Both
services are provided on a "cost recovery" basis, and permit fees offset the
costs of services delivered. Incomplete construction must obtain building
permits from the Building Inspections Department of the City of Denton.
G. Planning and Development Services
Planning and development services will be made available on the effective
date of the annexation. The Planning and Development Department
currently services this property by way of administration of the Denton
Development Code, concerning subdivision and land development
regu ations.
City Council adopted The Denton Plan, the city's 1999-2020
comprehensive plan, by Ordinance 99-439 on December 7, 1999. The
Future Land Use Plan addresses both land in the city and its ETJ, and the
subject tract is within the Rural Areas land use designation. The Denton
Plan designates future land uses to manage the quality and quantity of
growth by organizing the land use patterns, by matching land use intensity
with available infrastructure, and by preserving floodplains as
environmental and open space corridors. The Denton Plan will be used as
a basis for final zoning classifications after the properties are annexed.
IV. UTILITY (RATEPAYER) SERVICES
A. Solid Waste Collection
The City of Denton is the exclusive residential and commercial solid
waste service provider in the City. City Ordinance requires Solid Waste
services for all residences and commercial businesses located within the
city limits. The City of Denton Solid Waste Department is fully funded
through the service fees charged, and receives no funding from city tax
revenues. Solid waste refuse collection services will be provided to the
newly annexed property immediately upon the effective date of the
annexation. To receive solid waste collection service, the customer must
contact the City of Denton Customer Service Office, 940-349-8787, and
submit arequest/application for service. Commercial customers are
required to complete and submit a Service Agreement to Solid Waste
Customer Service prior to receiving service.
Residential Solid Waste Services
Each residential address will be provided a wheeled refuse cart, which will
be serviced one time per week. Residents are required to place their refuse
cart(s) at the curb prior to 7:00 a.m. on their collection day. Carts should
be placed at the curb for collection no earlier than 6:00 p.m. the evening
prior to their collection day. Carts are to be removed from the curb no later
than 6:00 a.m. on the day following their collection day. All refuse placed
in the cart for collection must be bagged to eliminate wind blown debris
and littering. Refuse that is not placed in the cart with the lid closed will
not be collected. Additional carts may be provided for an additional
monthly charge.
Weekly yard waste service is provided. Weekly bulky item collection
service is provided.
Weekly curbside recycling services are provided by Trinity Waste
Services. Contact Trinity at 1-800-766-1758 to obtain curbside recycling
information.
Each residential customer's refuse cart service, curbside recycling service,
bulky item collection service, and yard waste service will occur the same
day of each week. Please telephone Customer Service, 940-349-8787, to
answer any remaining questions, and sign up for service.
Commercial Refuse Service
Each commercial business will be provided with a commercial
container(s), which are available in a variety of sizes and frequencies of
collection, based on the waste type and volume generated. All refuse
placed in the container for collection must be bagged to eliminate wind
blown debris and littering. Refuse that is not placed in the container with
the lid closed will not be collected. Refuse placed outside the container is
subj ect to code enforcement regulations, including potential fines.
Landfill Service
The City of Denton Solid Waste Landfill hours of operation are 7:00 a.m.
to 4:00 p.m. Monday through Friday; and 7:00 a.m. to 12:00 p.m. on
Saturdays. For information regarding disposal charges, call the Landfill
Office at 940-349-7510.
B. Water/WastewaterFaci1ities
There are no water and wastewater facilities in the area to be annexed.
The city will provide a level of water and wastewater service,
infrastructure, and infrastructure maintenance that is comparable to the
level of services, infrastructure, and infrastructure maintenance available
in other parts of the city with topography, land use, and population density
similar to those reasonably contemplated or projected in the area.
C. Drainage Services
Drainage maintenance will be provided to the property upon the effective
date of the annexation. The City will provide a level of drainage services,
infrastructure, and infrastructure maintenance that is comparable to the
level of services, infrastructure, and infrastructure maintenance available
in other parts of the city with topography, land use, and population density
similar to those reasonably contemplated or projected in the area.
D. Electrical Services
CoServ Electric is certified by the State and is obligated to provide electric
utility service to the annexation area should a request be made by a
property owner. Electric utility service will be made available on the
effective date of the annexation on the same basis and at the same level as
similar facilities are maintained throughout the city.
V. OTHER SERVICES
Other services that may be provided by the City, such as municipal and
general administration will be made available on the effective date of the
annexation. The City shall provide a level of services, infrastructure, and
infrastructure maintenance that is comparable to the level of services,
infrastructure, and infrastructure maintenance available in other parts of the
City with topography, land use, and population density similar to those
reasonably contemplated or proj ected in the area.
VI. CAPITAL IMPROVEMENTS PROGRAM (CIP)
No new construction of additional water, sewer, street, and drainage facilities
is contemplated within the annexed area as a result of this annexation. No
construction of public improvements is contemplated as a result of this
annexation that would begin within two and a half (2 %2) years after the
effective date of the annexation. The City shall consider construction of
other public improvements as the needs dictate on the same basis as such
public improvements are considered throughout the City for areas having
similar characteristics oftopography, land use, and population density.
VII. UNIFORM LEVEL OF SERVICES MAY NOT BE REQUIRED
Nothing in this plan shall require the City to provide a uniform level of full
municipal services to each area of the City, including the annexed area, if
different characteristics of topography, land use, and population density are
considered a sufficient basis for providing different levels of service.
VIII. T_
This service plan shall be valid for a term of ten (10) years. Renewal of the
service plan shall be at the discretion of City Council.
IX. AMENDMENTS
The service plan may be amended if the City Council determines at a public
hearing that changed conditions or subsequent occurrences make this service
plan unworkable or obsolete. The City Council may amend the service plan to
conform to the changed conditions or subsequent occurrences pursuant to
Texas Local Government Code, Section 43.056 (Vernon Supp. 2000).
EXHIBIT 4
SERVICE AREA ANALYSIS
A07-0006 Hills of Denton North Annexation
The Planning and Development Department has received a request for annexation of
approximately 484.84 acres of land located west of Locust Street (FM 2164} and south of
Milam Road.
Size: 484.84 acres
Location: West of Locust Street (FM 2164} and south of Milam Road
Proposed use: Single Family Dwellings and Commercial Retail
Proposed zoning: Master Plan Community (MPC)
The purpose of the service area analysis is to determine how the city would provide services to
the area should it be annexed into the city. A service area analysis form is attached. Please
provide the requested information and any other pertinent information. To determine the city's
ability to provide services to the proposed area it is necessary to document:
• each department's existing capacity to provide an adequate level of service to the
proposed area;
• additional personnel and capital equipmentlfacilities necessary to provide an adequate
level of service to the proposed area; and
• cost of providing additional service.
Existing Conditions:
Proximity to existing arterial and collector roads. This site is located on the southwest corner of
Locust Street (FM 2164) and Milam Road. The Mobility Plan designates Locust Street as a
Primary Major Arterial and Milam Road as a Secondary Major Arterial. There is a Secondary
MajorArterial that runs east-west along the southern boundary of the site.
Future Land Uses. The proposed annexation area is within the Rural Areas and
Neighborhood Centers land use designations.
Existing land uses: The majority of the subject site is currently undeveloped. There are
approximately 9 existing structures located on the site.
Prominent natural features: The Environmentally Sensitive Areas (ESA) map shows that this
property contains ESA -Undeveloped Floodplain and Riparian Buffers. This site contains 100-
yearfloodplain.
Proximity to other service providers: This property is along the northern border of the City of
Denton. Based on the current data, there is no water line or sewer line in close proximity to
the subject site. The closest water line is located south along Loop 288.
Thank you for your consideration of this request. Please submit any other information that you
believe is pertinent to evaluate the provision of services to this area to Ron Menguita in the
Planning and Development Department by March 5, 2008, and call (940) 349-8328 if there are
any questions.
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SERVICE AREA ANALYSIS
A07-0006 Hills of Denton North Annexation
Fire
1. Fire and Emergency Medical Services can be provided to the area from station(s)
# 4 located at 2110 E. Sherman and #5 located at 2230 W. Windsor.
2. Estimated response time. 6-9 minutes
3. Appropriate response time in the City. 5 minutes
4. Is a new fire station approved in the CIP that could serve this area? No If yes, what is
the CIP program year?
5. Will a new fire station be requested in upcoming CIP proposals to serve this area? Yes
If yes, when should this station be operational? 2012
6. Total estimated funding for equipment, employees and/or facilities needed to serve this
area strictly based on annexation and proposed development. TBD
7. Please comment on the cumulative impact of annexation and development.
At what population level would another fire station facility be required? NIA
Is there an accepted facilitylequipment to population ratio that can be used for planning
purposes? No
Is there an accepted firefighter to population ratio that can be used for planning
purposes? No
Additional Comments:
Ross Chadwick, Fire Chief March 4, 2008
Person to contact if there are questions Date
SERVICE AREA ANALYSIS
A07-0006 Hills of Denton North Annexation
Parks and Recreation
1. What neighborhood park and recreational facilities are currently serving this area or are
capable of serving this area if annexed and/or developed (federal, state, or local)?
None are within the proposed annexation. The closest Denton Parks properties to
the proposed annexation area are North Lakes Park 3.2 mile to the south, Evers Park, 3.5 miles to the south and Water Works Park, 3 miles to the east. Current
residents will be able to use existing City of Denton parks, facilities and
programs.
2. What projects and/or equipment will be needed to adequately serve this area if annexed
and/or development based on the parks and recreation master plan or similar
standards? The 2000 Denton Park and Recreation Master Plan does extend to the
general area of the proposed annexation. As neighborhood subdivision
development occurs, neighborhood parks and community parks with athletic
facilities will be necessary. This will be accomplished by the use of the City of
Denton Park Land Dedication Ordinance which calculates the required acreage as
residential areas are final platted.
Neighborhood Parks: 2.5 acres per 1,000 population (to be dedicated at time of
development)
5acres minimum size.
Neighborhood Park Development cost per acre is
approximately $60,000lacre.
Community Parks: 3 acres per 1,000 population
30 acres minimum
cost per acre.
Recreation Center: square feet per 1,000 population.
square feet minimum size.
cost per square foot.
Other facilities
Community Parks: square feet per 1,000 population.
squarefeet minimum size.
cost per square foot.
3. How much additional funding will be needed for maintenance if additional park facilities
are developed to serve this area? None required for Parks at this time. However
addition mowing for street right of ways will be needed. Annual Cost for new
street right of way mowing for 5 cycles is estimated at $100.00 per cycle per mile
of new right of way mowing areas to come into the city.
Service Standard: Based on $41.00 per acre per mowing cycle.
4. How many additional personnel would be needed to properly serve this area if annexed
and developed? No additional personnel for Parks maintenance required at this
time. However additional resources will be required for road right of way mowing
along roadways that become city streets.
additional personnel per 1,000 population;
additional personnel per 1,000 square feet of facility; or
additional personnel per acre of park.
5. Service Standards:
additional personnel per 1,000 population
cost per additional personnel
Additional Comments:
Denton Parks and Recreation Departmentwill attemptto coordinate placement of park
facilities proposed for development by the developer or use funds from the Park Land
Dedication requirements to purchase or expand existing parks within the service area of
this development.
Bob Tickner,
Superintendent of Park Planning and Development March 24, 2008
Person to contact if there are questions Date
SERVICE AREA ANALYSIS
A07-0006 Hills of Denton North Annexation
Police
1. Estimated average response time for this area based on current department conditions:
Priority 9 minutes
Non-priority 20 minutes Average 14 minutes
2. Appropriate average response time in the city based on current department conditions:
Priority 9 minutes
Non-priority 20 minutes
Average 14 minutes
3. If annexed and developed as proposed will additional personnel be needed as a specific
result of this proposal? No. If yes, how many? What type?
4. Will additional equipment and funding be needed to serve this area? No. If yes, what
type?
5. Will a police substation or other facility be needed to serve this area as a result of
annexation and development? No. If yes, when should the new facilities be
operational?
6. Please comment on the cumulative impact of annexation and development.
At what population level would another police facility be required? NIA
Is there an accepted facilitylequipment to population ratio that can be used for planning
purposes? No
Is there an accepted officer to population ratio that can be used for planning purposes?
No
Additional Comments:
Captain Scott Langford March 24, 2008
Person to contact if there are questions Date
SERVICE AREA ANALYSIS
A07-0006 Hills of Denton North Annexation
LiLi-Y
1. Estimated additional funding needed strictly based on proposed annexation and
development. $40,500
2. Please comment on the cumulative impact of annexation and development. Since the
proposed annexation area shows a maximum of 1,684 single family units, the
annexation and development of the Hills of Denton North will have a negative
impact on library services atour North Branch facility.
3. At what population level would another libraryfacility be required? 131,738
4. Is there an accepted circulation to population ratio that can be used for planning
purposes? Yes. 7.47 is the national 2007 annual circulation per capita average for
the service area population served by the Denton Public Library.
5. Is there an accepted employee to population ratio that can be used for planning
purposes? Yes. According to the Texas Public Library Standards it is one (1)
FTE per 1,000 populations and one (1) professional librarian per 8,000
populations.
6. If annexed, can anticipated service demands be met using existing materials, facilities,
and personnel? No. The proposed annexation area population will increase
service demands at our North Branch which is already operating at reduced
staffing levels.
7. If not, how many additional employees and what type of facilities and materials will be
needed to provide services? Three (3) additional employees are needed to provide
adequate staffing when the number of maximum single family units is built out.
Additional Comments:
This annexation will impact the current level of library services provided at our North
Branch as it is in proximity to the service plan request.
Eva Poole March 5, 2008
Person to contact if there are questions Date
SERVICE AREA ANALYSIS
A07-0006 Hills of Denton North Annexation
Solid Waste
1. Is residential solid waste service available to the proposed area for annexation? Yes
2. Is commercial solid waste service available to the proposed area for annexation? Yes
3. What is the estimated cost to provide this area with solid waste service?
Residential: Large Refuse Cart - $17.751 month
Medium Refuse Cart - $16.60 I month
Small Refuse Cart - $15.001 month
Recycling Cart - $3.501 month
Commercial: Based on container size, and frequency of service.
4. What is the typical revenue collected per:
Household. Based on Refuse Cart size selected.
Commercial Business Based on container size, and service frequency.
5. Will additional equipment be needed to serve this area if annexed or developed? No
Type of Equipment. None
Cost of Equipment. NIA
6. Will additional employees be needed to serve this area if annexed or developed? No
Type of Employees. None
Number of Employees. None
7. Please comment on the cumulative impact of annexation and development.
At what population level would additional equipment be required? NIA
Is there an accepted equipment to population ratio that can be used for planning
purposes? No
Is there an accepted employee to population ratio that can be used for planning
purposes? No
Additional Comments:
S. Lebsack, SW Administration Manager March 4, 2008
Person to contact if there are questions Date
SERVICE AREA ANALYSIS
A07-0006 Hills of Denton North Annexation
Electric Utilities
1. What is the distance to, location of, and size of the nearest CoServ electric line?
2. What type of lines and facilities would be required to serve this area?
3. Are any new lines or facilities proposed for construction to serve this area?
4. Are there any potential responsibilities if this area is annexed?
5. Please comment on the cumulative impact of annexation and development.
At what population level would additional equipment be required?
Is there an accepted equipment to population ratio that can be used for planning
purposes?
Is there an accepted employee to population ratio that can be used for planning
purposes?
Additional Comments:
CoServ Electric has in place on or nearthe referenced property an adequate and
dependable source of electric power and energy capable of supplying electric service to
the proposed development location. Service can be extended to the developed tracts
upon request according to our approved Tariffs.
Loren Smith, Project Management Coordinator
CoServ March 17, 2008
Person to contact if there are questions Date
SERVICE AREA ANALYSIS
A07-0006 Hills of Denton North Annexation
WaterlWastewater
1. What is the nearest City of Denton water line?
Size of water line. 36 inch
Location of water line. North side of Loop 288 west of Locust
Street
Distance from proposed annexation.
2. What is the nearest City of Denton sewer line?
Size of sewer line. 18 inch
Location of sewer line. On Nicosia Street south of Loop 288
Distance from proposed annexation. 3500 feet
3. According to the City of Denton master plan what type of lines and facilities would be
required for this area and when are those lines and facilities proposed for construction.
Water lines Line extension requirements and lines sizes will be determined
during the preliminary platting phase of the project.
Sewer lines 30 , 36 and 42 inch. Construction of sewer line will coincide
with the development of Hills of Denton property. The sewer
line will begin at the Hills of Denton property and travel east
along the MilamlClear Creek to the future proposed City of
Denton Clear Creek Water Reclamation Plant.
4. Are there any City of Denton lines included in the proposed annexation? N0.
5. Please comment on the cumulative impact of annexation and development
At what population level would additional equipment be required? 6,250
Is there an accepted equipment to population ratio that can be used for planning
purposes? 6,250
Is there an accepted employee to population ratio that can be used for planning
purposes? 6,250
Additional Comments:
The proposed annexation area will be served by the construction of a new interceptor
sewer line (see attached Exhibit "B"). The City of Denton Ordinance No. 2007-125, Dated
June 5, 2007, for agreement between City of Denton and Denton 288 LP, for Provision of
Sanitary Sewer & Water Facilities pertaining to Hills of Denton will dictate the
responsibilities of the City and the Developer of Hills of Denton to provide wastewater
and water service to the proposed annexation area.
P. S. Arora, Assistant Director forWastewater March 4, 2008
Tim Fisher, Assistant Director for Water March 25, 2008
Person to contact if there are questions Date
SERVICE AREA ANALYSIS
A07-0006 Hills of Denton North Annexation
Engineering and Transportation
1. What existing roads, bridges and other transportation facilities will be impacted by this
proposed annexation and development in terms of needed improvements or upgrades?
Name and location Type of Improvement Approximate Cost
See comments below
2. Are any of these improvements presently scheduled to be done at state or federal
expense? N0. If yes, please identify facility and anticipated date improvements will
begin.
3. Please list any drainage improvements that may require local funding, and include
estimated cost (if no specific improvements can be determined, please make general
comments concerning drainage).
Storm water from this property drains south and east to the floodplains of Milam
Creek and Milam Creek Tributary 10. At this time, no specific drainage
improvements are envisioned to be needed as a direct result of this annexation;
however, as this land develops, drainage improvements will be required in
accordance with the City of Denton Development Code, Drainage Criteria Manual
and other applicable ordinances.
4. Will additional equipment and facilities be needed as a specific result of this annexation
and development? N0. If yes, what type of equipment or facility?
5. Please comment on the cumulative impact of annexation and development.
At what population level would additional equipment be required? NIA
Is there an accepted equipment to population ratio that can be used for planning
purposes? NIA
Is there an accepted employee to population ratio that can be used for planning
purposes? NIA
Additional Comments:
A Traffic Impact Analysis will be required that assess the effects to the existing
roadways as well as those required of the Denton Mobility Plan. Additional roadways
may be required depending on the resulting LOS capacities determined. The property
owner should be aware that there is a proposed EIVIITollwayforthis area and should
contact the proper authorities for direction.
Bernard Vokoun March 14, 2008
Chad Allen March 17, 2008
Person to contact if there are questions Date
SERVICE AREA ANALYSIS
A07-0006 Hills of Denton North Annexation
Denton Independent School District
1. Education services are currently provided by: Denton Independent School District
2. If annexed, can anticipated service demands be met using existing materials, facilities
and personnel?
No -Current DISD facilities and staff levels will not service the student population
resulting from the Hills of Denton North Annexation anticipated 1,684 single-family units.
3. If not, how many additional employees and what type of facilities and materials will be
needed to provide services?
Student Yield (.75 =SIF .20=MIF) Elementary Middle High Total
Pop. 674 286 303 1263
Campus Requirements Elementary Middle High Total
1 ~/2 to 1 ~/2 to 1 2-3
Staffin Elementary Middle High Total
65 55 -110 100-200 220-375
Considering the entire Hills of Denton Developmentthe districtwould require 1'/2 middle and high school facilities. The additional student population could possibly attend an
existing middle or high school facility or a completely new middle or high school could
be constructed. Student densities will dictate exact number of facilities required.
4. Estimate additional funding needed strictly based on proposed annexation and
development.
New Facilities - Elementary Middle High Total
$20 Million $43 Million $120 Million $183 Million
Staffing Salary - Elementary Middle High Total
$1.4 Million $2.8 Million $4 Million $ 8.2 Million
5. Will projected school taxes from this development provide that additional funding?
To be determined.
6. Please comment on the cumulative impact of annexation and development.
This proposed annexation will provide city services to DISD facility.
The proposed annexation would require DISD to pass additional school bond programs to finance construction of new facilities.
7. At what population level would other school facilities be required for the City of Denton?
New facilities are designed to accommodate the following:
Elementary - 650 - 700 students
Middle School - 900 -1000 students
High School - 1800 -2000 students
8. Is there an acceptable employee to population ratio that can be used for planning
purposes?
Elementary - 22 students per teacher
Middle School - 28 students per teacher
High School - 28 students per teacher
Additional Comments:
Rod Reeves (940) 369-0250
Coordinator of Facilities, DISD March 25, 2008
Person to contact if there are questions Date
EXHIBIT 5
NOTIFICATION INFORMATION
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Public Notification Date: 2/27/08
200' Legal Notices sent via Certified Mail: 21
500' Courtesy Notices sent via Regular Mail: 5
Number of responses to 200' Legal Notice y
■ In Opposition: 0
■ In Favor: 0
■ Neutral: 1
4 ~~ge ~7
1 T~niht ~ here just lo~lci~,g the 1 owns that prey ,ad will Il. Lies li~'in them.
annexation. ~ I~~n hay inti~ied tie ~r~p~ Gust very ~I~~~.1~ wT~
~cl~l~r. And as lion ~ indi~atd, we bay s~brnitted f .I.1LI1~1r~': Actually, l respond to
~ Ivy. ~ ~ rr~ainder ~f ~i property what we're 4 two ~o~nts. Fiat by o~~sioner Lyle, looking t~ d~ world b~ very si~il the dills of taf~` did ontaet
v~1T and were
~ lent~n, ~~t i~f dust single~fail and eonereial. Igo ingested in annetn that piece of prop.y, ~~t after
~ multi-fa~il~ no ind~trial uses ~r anything like that. ~ ox by e ti~ne~e get rep~n~e, it was already tao
. think a w get away ~'ro the pity it's, you know, amore Iate for us to go dead and ad'~~rtise it and do it. Buy we
~ r~zrala ~ role-family. w have s,e floodplain a do it separately as a p~ if y~ want incorporate .
1~0 n party will eontin~e with ~ trails ar~d fiat into the city to het it out ~f e ~T~. T~atts nod a
11 ~h. ~ ~ ~ pr~b~e
~ but r~~ i~ t~,e a~tion~~ ~bvi~u e ~ ~ lien the qtr i ~r ~~e~ion fat
I ~ woad like to ~ in pity to coati nun what we s~ ~ ~ vas r~ai~ed ~ ornmissi~ner ehaa~ regarding tie dap .
~ t4 with . H~i~~ ~ lnton.. 1~ inf~ati~n, t~. Mate andate,~. rewire that certain
1 ~ ~ I would b lppy to answer any quetion 1 dates and tines ~e follaw witk~n an anr~ea~tion. And , ~ .
1 . that y~~ Piave. Itrn lure e' l~l ~e in front o~y~u ~ nurn~er 1 ~ really tl]'e's a li~nitd nu.b- of dates that we can .
17 of tinLes arding I~_ I would be happy t~ ~nwer ~7 Arent it~t to P1a~r~in and Zoning omsion so they
. ~ question that you knave tonight. ~ c rnl~e pity council ~ we can stay on acl for the
~Ivi~IER ~A 1`. ~~ohhart, ~ ~ annexation. If we d0 ~s those wit happens 1
0 IR, IIIAT: , sir, ~ will ~ that ~hedule all ~ bl~ o that we've
~ ~~~lr,~1~ THIA: this Pr~l~~ ~ dot ~o sort X11 or again through no fault of die
ceder contract or is it already owned ~ ~ applicants. .
~ ~ ~ r~. x~T; It is owned. ~ ~ ~~what e ~ or what we to do is get
4 ~fIS~~I TH~~: wed ~ e okay. ~ a ~n~oh inf~rrnation and thf ~ riot typical, but what
. ~ you. we try to do is get all the infcation begin .
~ ~4 ~ ~ Page
~ 1+I~I~I~I1~ wATIl~F Any offer qu~o~a"? ~ proce~~ing the annexation. but l believe, if I' fit,
. des? ~ i~ that all cf that ir~fo~tion does have t~ be prer~d
3 O~~I.~~~d~ x~: Tyr to be a at ~ pity oneil. flay: ~ l apologise for that,
4 ~ very ~~nall pion ~f 1a~d tit .till mains in the ETA? Bit I did want t~ pull i~ from ~ ~kdule because
REEI~II~AR~": ~ . 'I~at t s two or the that infrrr~tian wad ~ t tkxere and it was not due to the
different Propey owr~. And ~ be~~eve thf s ~ applicant.
~ residential ste ~n thou properties. Koine --you ~ ~ x~.: '1'l~ar~k you.
~ might lave one of ~ ncigh~cr how ~ audience ~ I1~,1~~IT: ~ nod tc lei rrie lard'.
~ n~. ~ ~ ~ 'fat is the obsator. Tie ocr ile bay i
10 ~IIISI~I~111~ lCay. ~ farther down k~ere with tiie character on it. ~ I atd
~ 1 ~IIv~I~~I~'~ wTrt~: Any ~t qu~s~on~~ 11 to clarify that.
l~~eussion'? ~ ~ 1 ~ Irian way correct when iJT notifying
I ~ ~iI~I~I~E~ I~': I have saw ~ ~ 14 qu~s~,on about this little rectangle with tho nosh in it 14 OI~~~I~II1R wA~ : Any ct tion"?
1 here on the 1 i~cussion`~ Thank y~~, may,
~ fly. Hi~'~`: lawn here? 1 ~ ~~T: oaf re elea~ne.
~7 ~iilI~l1 LI: Fat~ther down. cab,. f.~ii,II~E ATI: flay, This is a
1 . ~I~I~~'~~ "fat way pad of the t public wring. o do we have anyone bore that could life
1~ previous flan. I bel~re tbat was the old missile I speak for rezoning annexation`s r'11 get it
~ station. ~ ~ right.
~ 1 OIvf IYI~~f~ w~,TI~: Missile bac`~ 1 1~. J~I~EIVI~AI: Exl~s~ . I don"t knew
I~~r~~.I~T; Missile base. ah, And your protocol. l name is erald.~ol~enhan. And c~
North Texas ~~nis~lc bay. ' applicant really trig auld I ~ yc- I believe this is our prope~.y here.
~ ~`chasc tit when they were trying to get thi~ property, 4 And Itv never been contacted, whatever. l but want tq
but for lad of a ~tt~r gm, ti's a character that l~ncw t dantagcs of annexation or act ei annexed,
~~~'.~I.II~x ~ 1~]I~ III -1- ~gc ~ ~ Page ~
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~a 4 fag ~
~ I~~AT: you're nit, ~ ~rap~.y, Ft brings it within the reg~t~ry j~x~sdiction
. JxrsH.4; shay. wef re not' ~f pity of Benton for lad ~1e, whereas# it o~se
~ PAIR. REIHH~'~, X10. ~ world . 4 ~ IviR. JH~I3~: ~ wig never fir, I ~ ~ ~IS,I~I~E wA~"I; "ire. ~oliee.
. ~riean, there's ~t~r areas t~.~ . Wit. And a~ ~ ~f
~ III~~~ T~iis is .riot that ~e~ fir tl~s, here is a schedule of proposed pity
'1 eo~tt ~ ~ serv~cs i~t would be brought t~ this area as park of the
~x~vs~,v; well, Itll shut up then. icy of Denton.
~IiIsII~IE wTI': ~~w, you fir ~r ~IIIEI~ wATI: ~ J~s`~
~ ~s~ ~ annexation? Should it ~ be~~re pity ~ ~ 'i,at' what I wauld say in a
~ ~ ail? 1 ~ ~i.e amore de1~ you mow. Tr~'i, pik~p, ~~r~
I~, ~~H~HA~ ~ think it sh~~ld, yeah. ~ ~i~~, ~oliee pr~tion versus slaer~iffTs prote~~on for ~ .
1 ~ ~iII~'~R wATII}: And you are fot the ~ the eaty, ~ .
i 4 ~ ann~~on then`? ~ ~ 14 The sets are bunt ire e type of .
. J~x~~Aty: I d't how ~ ~d~ntages ~ e~nst~tion thatf antrall by the pity of .Ir~~on.
~ of it. ~ ~ ~ And a little amore ~ntrols. Some people probably are eons
~ 7 ~IvIIS~IE~ w~T~: okay. Thaw i'~ ~ you get into city tapes versus county taxes. .
~ ~ ~ Iii. J~I~~I~{ s~~. 1 ~ And fer s~thing lily thi~~ 'aw a lot
1 ~ ~~Y okay. ~ problem. 1 of opl, which i If ~ auing ~e~ } you lr~~w,
~ ~ problem. ~ ~ #here are people fat are moving from ~ ~r~etr~plex. Thy
~ Is the ~r~yone else that would lie ~ ~ have end o~ prot~c~ons now or those kind of
sped fir the aeati~n? Anyone. please came forward. facilities ~r th~se~ find f services. And ~ they
. [JTI~1~: I'1~1 also not familiar with just want trr~ rt`al, n that's fat thy'r
4 die prot~ol, but ~ ~ t~ o.p~. They're gttirYg you know,. do they
~IiII~?~~~ 1A~: arr~e ~ ~ have welly trash collection"? ~o they have take their
P~ 0 a .
I ~ leap. ~ ~ awn trash'? I~ feel they can call -1- I and have the
. ~y rx~rn is al~ina . city. police department show up and help them?
utiee. l'n~ crust a student at the ~Jniersity ~f ~rth~ 3 ~~t it" s all up to their c~oioe on whet
~ Tee, And I eras wondering if somebody could tell us the 4 they ~ it as a pre ~r a ern,
pros and eons of annexation. ~r i~ that saething that ~ Its. I~'i`iERI~E; key. 'Dank you.
. 6 wont be addressed here`s ~IIII~I~TI~~ w~",I,~ Thanl~ you.
7 I~II~iI►I~ ,A,T'~5~ ~"rn not ~u~e ~ ~ ~inyol~e f~~' against this at]T1~~Ca~1~~1`~ .
~ understand what y~~ geed t, kr~~w. ~ ~ okay. I~11close the public bearing.
~ u~rT~: If ~~ba~ e~uid X11 ~s ~ EAR if ~ catkins} r'~
~0 the pros and cans of aeatio~ ~f ~ land t ~ just like add one note.
~ 1 guys are talking about, e jurisdiction? and perhaps why ~ ~ Ietr ~ gut property owners
1 sornc residents dontt want to have it annexed. ~ within feet ~f u~jet property king ~h~ .
1 ~ ~I~fIII~~~ wATI~: ~ haven't sew ~ would ~ t~ annexed as part ~f this annea~i~n. And anytl~ against it. 14 staff did not receive any res~~nes back.
. ~ ~ I~IE: ~ jr~st wit ~ pros and 1 ~III~'~ wA~`I~': okay. Tank cu.
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~ reasons why someone ~s Ln favor of an annexation ~r . ~PvII~II}IEI~ EA~,E~'~I~' fan e live
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If theref S so~uebady who ~S pod to 1t~ I ~IVIIVII.I~I~~R THIvIA. ~ rr~~v approval.
~ n1e~E1"ly Q~ ~ only ask ~1~ you know, wlt then- 4 oIIY~~ ~'A~1~T~, Thank you.
. ~ ~ ~eoi~s ~ fir it. But; est., in annexing COfII~1~ ~r~; And Y second.
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EXHIBIT 7
RESPONSES TO PUBLIC HEARING NOTICE
A07-0006 HILLS OF DENTON NORTH ANNEXATION
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AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: Solid Waste
ACM: Howard Martin, Utilities 349-8232
SUBJECT
Consider adoption of an ordinance approving an amended and restated landfill and digester gas
rights and collection facility lease between Denton Power, LLC. and the City of Denton, Texas
providing for the extraction, collection, processing, use, sale, and delivery of landfill gas from
the city's landfill, and digester gas from the city's wastewater plant, authorizing the expenditure
of funds therefor; and providing an effective date (The Public Utilities Board recommends
approval (7-0.)
BACKGROUND
The City of Denton entered into a Landfill and Digester Gas Rights and Collection Facility Lease
agreement with DTE Biomass Energy, Inc. (DTE) on April 1, 2004. The lease agreement
provided DTE the exclusive right to explore for, extract, collect, process, use, sell, and deliver all
Landfill Gas in the Landfill and Digester Gas from the City's Wastewater Treatment Plant,
except that Landfill Gas which is required for the Biodiesel Production Facility. It provides for
the exclusive right for DTE to use and operate Denton's landfill gas collection system, and to
conduct all activities necessary to provide for the operation and maintenance of the system.
Costs associated with the gas well drilling and the installation of the collection lines and flare
system will be funded by the city of Denton. DTE will incur the costs associated with
monitoring and managing the system, and marketing the gas and/or the energy produced.
The Public Utilities Board recommended the award of Bid No. 3692, submitted by Shaw
Environmental and Infrastructure, Inc., Baton Rouge, Louisiana, for the construction of landfill
gas extraction wells and the gas collection system, and the installation of a gas flare at the City of
Denton's Landfill at their meeting of November 12, 2007. The City Council awarded this
contract to Shaw Environmental at their meeting of December 11, 2007. Shaw has begun work,
and is currently installing gas wells at the landfill.
The primary item which spurred a revised agreement was the definition of `Gross Revenues' .
The original agreement defined gross revenues as the `total receipts of the sales of landfill and
digester gas to the customer' .This definition only stated gas sales, and if electrical power is sold,
which is planned to occur, then the definition needed to be broadened to include electrical power
sales. The current definition of `Gross Revenues' is the `total receipts from sales of energy to the
customer.' Energy is defined as either gas or electrical power. The amended and restated lease
agreement provides additional clarity with a few definitions, provides clarity in a few other areas,
and adds a new section on Alternative Dispute Resolution.
Section 4.1, Royalty/Lease Payment, states that DTE agrees to pay the City of Denton 12.5%
of the Gross Revenues from the sale of energy, which is to be paid quarterly. The term of the
agreement is twenty years from the effective date of the original agreement (through March
31, 2024).
Section 4.2, Contingent Lease Payments, states that in the event Congress enacts Production
Tax Credits, entitling DTE to claim such credits or benefits or if DTE is able to claim Section
45 Production Tax Credits for electricity generation, then DTE agrees to pay the City of
Denton a further additional lease payment equal to twenty (20%) percent of the value of the
new tax credits or benefits.
Following Shaw Environmental'scompletion ofthe installation of the gas well system, and flare,
DTE will begin operation and maintenance of the landfill's gas well field.
OPTIONS
Update the Landfill and Digester Gas rights and Collection Facility Lease Agreement to reflect
the current plans for the development of the gas field and the sales of energy.
RECOMMENDATION
The Public Utilities Board and staff recommend the City Council approve the Amended and
Restated Landfill and Digester Gas Rights and Collection Facility Lease between DTE Biomass
Energy and the City of Denton, Texas.
PRIOR ACTION/REVIEW (Council, Boards, Commissions) The existing DTE agreement was recommended by the PUB at their meeting of February 23,
2004, and approved by the City Council at their meeting of March 23, 2004. The effective date
of the existing agreement is April 1, 2004.
The Amended and Restated Landfill and digester Gas rights Collection Facility Lease Agreement
was recommend by the Public Utilities Board at their meeting of January 28, 2008.
FISCAL INFORMATION
Energy revenues paid to the City of Denton will be paid based on 12.5% of the Gross Revenues
from the sale of energy (Section 4.1). If DTE is able to obtain production tax credits, DTE will
pay the City of Denton an additional lease payment equal to twenty (20%) percent of the value of
the new tax credits or benefits (Section 4.2).
EXHIBITS
1. Landfill and Digester Gas Rights and Collection Facility Lease.
2. Amended and Restated Landfill and Digester Gas Rights and Collection Facility Lease.
3. Ordinance
Respectfully submitted:
Vance Kemler,
General Manager, Solid Waste
Prepared by:
S. Lebsack
Administration Manager
I
EXHIBIT 1
LANDFILL AND DIGESTER GAS RIGHTS AND CCLLECTIGN FACILITY LEASE
This Landfill Gas and Digester, Gas Rights and Collection Facility Lease
"Lease" is dated as of A ril ~ , 2004 by and between the City of Denton, Texas, a
~ } p home rule municipal corporation ~"Owner" or "Lessor") and DTE Biomass Energy, Inc,, .
a Michigan corporation ~"DTE" or "Lessee"},
whereas Lessor owns and operates the City of Denton Sanitary Landf~Il located
't of Denton Texas at 1527 S. Mayhill Road the "Landfill"} and the City of. ~n the C~ y
Denton water Reclamation Plant located in the City of Denton at 1100 S. Mayllrll Road ,
. the "water Reclamation Plant Property"}, and;
whereas, ursuant to a Request for Proposal by the City of Denton entitled RFSP . P
#3111 Professional Services Contract far Design and Development of a Biodiesel
Production Facility, DTE and B~odiesel Industries, Inc. made a Proposal dated November
l3 2003 a co of which is on file in the Offices of the Denton City Engineer (the py
"Proposal"}, and;
whereas, the Lessor and Lessee desire to enter into this Lease to set forth the
teens and conditions of the leasing of Landfill and Digester Gas Rights and a ~ Landfill
Gas Collection S stern to be constructed by Lessor to collect land~:ll gas for a proposed Y
landfill. and digester gas to energy prof ect, and;
whereas, this Lease provides, among other things, for the construction by Lessor
of a Prelimina Gas Collection System sufficient in scope to supply the City's Biodiesel
Production Facility ~"BP Facility"} with all the Landfill Gas required to operate the BP
Facilit and to rovide for a Preliminary Gas Collection System sufficient in scope to y p
allow DTE to do a feasibility study to determine whether or not Landfill Gas and
Di ester Gas can be extracted and sold in Commercial Quantities, and; g
if Landfill Gas and Di ester Gas can be sold in Commercial Quantities . whereas, g
to a. Customer, Lessor agrees to construct an expanded Gas Collection System by Lessor
. sufficient in scope and size to permit the consummation of a Landfill Gas and Digester Gas Prod ect.
Now, therefore, ul consideration of the mutual covenants and agreements set forth
herein, Lessor and Lessee agree as follows:
s
1. D efznitions
1.1 "BTU1cf'shall mean British Thermal Units per cubic feet and is defined as a
unit of energy equal to the heat needed to raise the temperature of one pound of water
from sixty X60} degrees Fahrenheit to sixty-one X61} degrees Fahrenheit at a constant
ressure of one standard atmosphere, The BTU equivalent on a dry basis at 14.b5 psia p
may be obtained by multiplying the BTU so measured by the factor 1.012.
F
' C
1.2 "Collection System or Gas Collection System" means the network of recove rY wells and interconnecting pipes together with attendant valves, pum s, rnonitorin
P g devices and other extraction related equipment installed for the purpose of extractin and
g recovering Landfill Gas, including a blower sufficient to deliver the Landfill Cray to a
flare, a condensate recovery system, a flare, gas meter, including any expansions thereof
i including expansions to the Preliminary Gas Collection System to sell Landfill Gas to a
Customer,
1,3 "Commercial Quantities" shall mean volumes of Landfill and Di ester Gas for
g sale deemed by Lessee to be sufficient in amount for the Project to be economxcall Y
viable, Recovery and sale of Landfill Gas and Digester Gas in average monthl volumes y
of mare than 1000 S CFM and more than a heating value of 450 BTUICF is
presumptively deemed to be Commercial Quantities,
1.4 "Customer" shall mean any suitable Landf 11 Gas and Digester Gas Purchaser
within a reasonable distance of the Landfill.
1.5 "Digester Gas" shall mean methane, carbon dioxide and other constituent
products produced by the anaerobic decomposition of waste water and stud e at the
g sewage treatment plant adj acent to the Landf 11.
1.G "Delivery Point" shall be at a meter near a flare with blower on the Landfill,
1.7 "Gross Revenues" shall mean the total receipts from sales of Landfill and
Digester Gas to Customer.
1.8 "Expanded Gas Collection System" means that onion of the Gas Collect' p ion
System built or to be built in addition to the Preliminary Gas Collection S stem, Y
1.9 "Feasibility Study" shall mean a study performed by Lessee as soon as
practicable after the Effective Date to determine whether or not Landfill or Di ester Gas g
can be sold in Commercial Quantities, In no event shall such study be com Ieted later P
than 2 years from the Effective Date minus the reasonable time necessa to com fete rY P construction of the Gas Collection System,
1.10 "Landfill Gas" shall mean methane, carbon dioxide and other constituent
products produced by the anaerobic decomposition of refuse material within the Landf 11.
7t is personal property and does not include oil, gas, or other mineral interests in real
property.
1.11 MMBTU shall mean one million BTUs.
1,12 "Preliminary Gas Collection System" shall mean that porCion of the Collection
System built by the City of Denton in support of Biodiesel production,
2
R
1,13 "Project" shall mean all activities and efforts associated with the recovery and
sale of Landfill Gas and Digester Gas and their delivery to a Customer. .
1.14 "Project Schedule" shall mean the proposed schedule attached hereto as Exhibit
"A" and made a part hereof by reference,
1.15 "SCFM" shall mean standard cubic feet of Landfill Gas and Digester Gas per .
minute, measured at sixty degrees Fahrenheit ~6o degrees F,} and at a pressure of fourteen
and seventy- three one hundredths X14.73}pounds per square inch absolute ~psia}.
2. Term
This Lease shall become effective on the Effective Date and shall continue for a term
of twenty X20} years,
3, Rights Granted to Lessee
Subject to the provisions of this Lease, Lessor hereby grants to Lessee the following;
3.1 Landf ll and Digester Gas. The exclusive right to explore for, extract, collect,
process, use, sell and deliver alI Landfill Gas in the Landfill and Digester Gas from the
City's Vi~astewater Treatment Plant, except that Landfill Gas which is required for the
Biodiesel Production Facility, This right is subordinate to Lessor's right to use the
Landfill for landfill purposes and its right to use the water Reclamation Plant Property for water reclamation purposes. However, Lessor agrees to cooperate with Lessee in all
reasonable manners necessary to carry out Lessee's rights under this Lease,
3.2 Gas Collection System, The exclusive right to use and operate a Gas Collection
System at the Landfill other than that which is required for the BP Facility, subject to the
Lessor's rights set forth in Section 3,1, Such right and related activities encompasses the
right to conduct all activities necessary and incidental to the operation and maintenance
of a Gas Collection System, which includes the right, but not the obligation, to install
underground gas transmission pipes, operate associated gas collection equipment, and
other related equipment. The cost of additional well drilling to comply with
environmental laws or to enhance Landfill Gas collection will be born by the Lessor, The
cost of operation and maintenance of the Gas Collection Facility, and related pipeline, if
any, to the Customer shall be born by Lessee provided that; ~1} the Landfill Gas and
Digester Gas volumes and quality produced by the Landfill and wastewater Treatment
Plant meet the standard of Commercial Quantities as defined in Paragraph 1.3, and; ~2}
The Gas Collection System is suitable for use by both the BP Facility and the Customer. Failure to complete the entire Gas Collection~System, as designed by the Lessee, over and
above the Gas Collection System portion required for the BP Facility, within two years
after Lessee's determination that Landfill Gas and Digester Gas can be economically
recovered as provided in Section S is cause for termination by the Lessee, Failure to
complete that portion of the Gas Collection System portion required for the BP Facility,
3
within six months of the Effective Date of this Lease is also cause for termination by the
Lessee.
3.3 Plant Site, Lessor shall make available to Lessee, a mutually acceptable site of approximately two hundred feet ~20o ft.~ by three hundred feet ~3oD ft.~ in
size to
accommodate the construction and operation of the gas processing plant and related
facilities for ~I,DD per year and other good and valuable consideration, Lessee shall have
the right of free ingress and egress at all times to and ftom such site for itself and its
customers, provided that such ingress and egress is consistent with appropriate security
measures imposed by Lessor and is subordinate to Lessor's use of the Landfill for landfill
purposes, Lessor and Lessee shall in good faith mutually agree on a suitable location or
locations for such access that does not interfere with Lessor's Landfill operations,
4. Payments To Lesser
4,1 RoyaltylLease Payment. Lessee agrees to pay Lessor twelve and one-half percent
~I2,5%~ of Gross Revenues from the sale of Landfill Gas and Digester Gas to all
Customers exclusive of any applicable taxes to the Proj ect provided that Landfill Gas and
Digester Gas volumes and quality conform with the definition of Commercial Quantities
found in Paragraph 1,3 hereof. Landfill Gas provided to the BP Facility is not subject to
royalty payments.
These royaltyllease payments shall be paid each calendar quarter to Lessor on or before
the last day of the month following the close of the calendar quarter the "End of the
Quarter"} with the first payment being due and payable at the End of the Quarter
immediately after the Gas Collection System and gas processing plant become
operational. Along with such payments Lessee shall provide documentation to Lessor
evidencing all Gross Revenues and deductions for taxes. Lessor shall have the right at all
reasonable times to audit the records of Lessee to determine that the royaltyllease
payments have been properly computed,
4,2 Contingent Lease Payments. Lessee represents that the sale of Landfill Gas from
the Landfill does not currently entitle Lessee to claim Internal Revenue Code Section 29
Production Tax Credits, fn the event Congress enacts Production Tax Credits, entitling
Lessee to claim such credits or benefits, Lessee agrees to pay Lessor a further additional
Lease payment equal to twenty ~2D%~ percent of the value of those new tax credits or
benef ts.
S. Lessee's Obligations
Lessee agrees to;
~a~ Conduct a Feasibility Study to conf rrn that Landfill Gas and Digester Gas are
available in Commercial Quantities.
4
L
(b} Provided Commercial Quantities are available, design, operate and maintain the
Gas Collection System. Lessor shall have to right to monitor Lessee's
performance of such, Nothing in this Lease shall be construed as Lessee
assuming any of those obligations imposed by law upon Lessor as owner of the
Landfill, including compliance with environmental laws, unless such obli ations g
are caused by Lessee or are expressly assumed by Lessee.
6. Lessor's Obligations
Lessor agrees to.
(a} cooperate in the construction, development and operation of its Landfill wastewater
Treatment Plant and the Collection System so as ~to maximize the production of Landfill
Gas and Digester Gas and the transportation of Landfill Gas and Di ester Gas to the
g Delivery Point; (b} not unreasonably interfere with the Lessee's operation of the Project
J or cause the disruption or destruction of the biological decomposition of refuse material
within the Landfill; (c} prevent any of its independent contractors from committin such
interference disru Lion or destru g p coon; (d} promptly repair all cracks, fissures, erosion or
physical changes in, of, or to, the interim and final covers at the Landfill which have an
adverse material effect on the production of Landfill Gas; e coo erate in the . p
construction, development, operation and maintenance of the Project and the Collection
System at the Landfill; (f} comply with all applicable federal, state, coun munici a1 tY~ p and local laws, statutes, rules, regulations, ordinances, cedes, restrictions
re uirements
q obligations and permitting requirements relating to the management and o eration of the
p Landfill, ~nclud~n all environmental 1 ' ' ~ '
g aws perta~n~ng to the Collection System, provided such laws are specifically imposed upon Lessor and have not been im osed u on Lessee
p p or expressly assigned and accepted by Lessee and; (g} approve in a timel manner all
Y Project design plans, specifications, and requisite construction activities which involve
Lessor's property, (h} construct the pipeline from the waste water Treatment lant to the
Landfill flare and const p rust the entire Gas Collection System as designed by Lessee
following the conclusion of a favorable Feasibility Study by Lessee.
7. Emission Credits
To the extent Pollution Control Emission Credits are available to the Project the
value of such Emission Credits, if any, shall belong to Lessee.
8. Special Right to Terminate
within two years after the Effective Date of this Lease, Lessee, at its sole ex ense
shall conduct a Feasibili Stud p '
tY y as 1t deems appropriate in order to determine whether ' Landf 11 Gas and Digester Gas can be economically recovered from the Landfll and
vastewater Treatment Plant in Commercial Quantities and whether such Commercial
Quantities can be economically delivered to a Customer. ~ the event that Lessee's
Feasibility Study establishes, in its sole judgment, that the Landfill Gas from the Landfill
and Digester Gas from the wastewater Treatment Plant are not suitable for the economic I'
. ~
_ _
recovery and processing in Commercial Quantities for the Customer, Lessee shall ive g
Written notice to Lessor of such judgment. Thereafter, all rights of Lessee under this
Lease shall terminate without further liability on the part of either part to the other Y
hereunder. .
9. Construction and Maintenance of Facilities
9.1. Lessee shall not be responsible for the construction, operation and maintenance
of the BP Facility, Such construction, operation and maintenance being under se crate
p agreement between the Lessor and Biodiesel Industries, Inc,
9.2. Lessee shall be responsible for the design, operation, and maintenance of the Gas
Collection System and the construction of the pipeline from the Delive Point to the
rY Customer at its expense, following the conclusion of a favorable Feasibility Stud .
y
9.3. Lessor shall be responsible for the construction of the Preliminary Gas Collection
System and, assuming the conclusion of a favorable Feasibility Study by Lessee, sha11
also be responsible for constructing the Expanded Gas Collection S stem related Y
infrastructure lying Within the Landfill property boundaries and the i cline from the pp
Waste Water Treatment Plant to the landfill flare, at its expense.
10. Surrender,
Upon thirty ~30~ days notice to Lessor, Lessee- may at an time or times surrender
~ a and terminate this Lease without liability, if ~1) Lessee is prevented due to no fault of its
owia to meet the milestones set forth in Exhibit A entitled Project Schedule, or 2
Landfill Gas cannot be recovered or sold from the Landfill, in Commercial uantities
Q and Lessee thereby is relieved of all obligations except for surrenderin the Gas
Collection S stem ~ ~ ~ ~ g y and gas processing plant and related facilities in good operational
condition, performing removal and restoration activities in accordance with Section 12
and making full payment to Lessor for obligations in Section 4 of this lease.
11. Lessor and Lessee Rights
11.1. Landfill Use, Lessee shall be authorized to use the Landfill, upon notif cation to
Lessor, without cost, to the extent reasonably necessary or convenient for Lessee to c
out its obli ations hereunder. u ~ g S ch use is subordinate to Lessor's use of the Landfill far
Landfill purposes.
11.2. ail, Natural Gas, Mineral Rights. This Lease shall not be deemed to ant
Lessee any rights or interests in any oil, natural gas, or other minerals located in the
Landfill real property but is only a lease of Landfill Gas and Digester Gas,
11,3. Cooperation in Qbtaining Authorization, Upon request by Lessee, Lessor shall
reasonably assist Lessee in any proceedings, hearings or other procedures necessitated b
y any required zoning laws, environmental impact reports, governmental .ermits
P a
6
s
4
authorizations and similar type requirements, related to the Project and the construction
and operation of Lessor's wells, collection system, and gas processing equipment, Upon
request, Lessee shall assist Lessor in briefing the officials of any governmental agency or
body, or any other interested party, with respect to the status of the Project.
11.4, Removal of Facilities, At Lessor's option, Lessee shall have an obli ation g
within six ~6} months after the expiration or termination of this Lease, to remove the above-ground property, fixtures and improvements which Lessee has placed
on ar
adjacent to the Landfill and to cap any transmission gas lines at the boundary of the
Landfill, There will be no Lessee obligation to remove underground property, fixtures
and improvements which Lessee has placed underground in or adjacent to the Landfill.
Lessee hereby grants to Lessor an option to purchase any of such above-ground property,
fixtures and improvements the "Option Improvements"} at a ~ rice e ual to Lessee's cast
p q of the Option hnprovements. The cost of the option Improvements will be established
within 94 days after the completion of any and all of the option Improvements by written
notice from Lessee to Lessor along with supporting documentation to establish. such cost
the "Option Improvements Price"~. Within 94 days after the expiration or termination of
this Lease, Lessor may elect to purchase the Option Improvements, or any part thereof,
for the Option Improvements Price, or applicable price of a part thereof, by providing
Lessee written notice of the election of the option. The urchase of the 0 flan p P
~mprovernents will be consummated wlthxn 90 days thereafter. At closing, in exchange
for the Option hnprovements Price, Lessee shall deliver to Lessor a bill of sale
transferring the Option Improvements to Lessor, free and clear of all debts and liens.
~1 Lessee' grants an option only on that equipment which was installed by Lessee.
11,5, Surface Restoration, Lessee shall, upon expiration or termination of this Lease,
generally restore the surface of the Landfll affected by its operations to its condition at
the commencement of this Lease to the extent reasonably possible. Pipes on landfill
easements shall be sealed and capped at Landf 11 properly boundary,
11.x. Return to Landfll Matter. Lessee shall, in connection with its operations on the
Landfll, have the right in its sole discretion, to return to the Landfill consistent with
Lessor's Landfill operating permits and environmental re tiilations an and all matter
.g y ether sold or l~qu~d ~~nclud~ng all condensate from the Prod ect}.
12. Warranty
Lessor makes no warranty of title express or implied to the Landfill Gas and Digester
Gas, Lessor covenants to Lessee the right of quiet enjoyment of the use of the Gas
Collection System so long as Lessee is oat in default. Lessee acknowledges that the ~ Landfill Gas and Digester Gas is personality and oat an oil, gas, or mineral
interest in real
property.
J
. 7
13, Default
13.1 Default by Lessee, 1n the event that Lessor concludes that Lessee's operations,
excluding the provisions of the Project Schedule, are at any time not being conducted in
material compliance with the provisions of this Lease, or fails to activel and dill entl y g y
pursue or operate the faczl~tres under this Lease, Lessor shall notify Lessee in writing of the facts relied upon as constituting a default hereunder, and Lessee, if in default,
shall
have ninety (90} days after receipt of such notice in which to complete ar substantiall
y complete compliance with such provisions. Lessor shall have the right to terminate this
Lease upon written notice to Lessee if Lessee fails to complete or substantially complete
such compliance efforts within the ninety (90} day period, unless such failure is excused
by the provisions of Section 1 ~ hereof. If compliance within ninety (90} days is not
reasonably possible and Lessee has commenced and is diligently pursuing such
compliance efforts, Lessee maybe allowed additional time to complete compliance, not
to exceed an additional ninety (90} days, but only if written notice of an extension is
given to Lessor within the first ninety (90} day period. Notwithstandin an hin g Yt g
contained herein to the contrary, upon term~nat~on of this Lease, due to a default by
Lessee the Gas Collection System shall revert back to Lessor in good operating condition
at no cost to the Lessor and the Landfill Gas rights shall be surrendered to Lessor.
13.E Default by Lessor, In the event that Lessee concludes that Lessor at an time is y
fazl~ng to perform or observe any of the provisions of this Lease required to be performed
or observed by Lessor, Lessee shall notify Lessor in writing of the facts relied upon as constituting a default hereunder, and Lessor, if in default, shall have ninety (90}
days
after receipt of such notice in which to complete or substantially complete corpliance
with such provisions, Lessee shall have the right to terminate this Lease upon written
notice to Lessor if Lessor fails to complete or substantially complete such compliance
efforts within the ninety (90} day period, unless such failure is excused by the provisions
of Section 17 hereof. If compliance with ninety t9a} days is not reasonably possible and
Lessor has commenced and is diligently pursuing such compliance efforts, Lessor may be
allowed additional time to complete compliance, not to exceed an additional nine 90 tY ( }
days, but only if written notice of an extension is given to Lessee within the first ninety
(90} day period.
14, indemni~catian
14.1 Lessor shall defend, indemnify and hold Lessee harmless from and against any
and all claims, demands, actions, proceedings, liability or losses, of whatsoever nature
including reasonable attorney's fees} for injury or death to persons} or far damage or
loss to property arising out of or caused by Lessor's operations ar activities in connection
with the Landfill, or any contiguous or non-adjacent property under Lessor's control
except to the extent such injury, damage or loss is caused by the wrongful acts ar
negligence of Lessee,
14,2 Lessee shall defend, indemnify and hold Lessor harmless tom and against any
and all claims, demands, actions, proceedings, liability or losses, of whatsoever nature
(including~reasonable attorney's fees} for injury or death to persons} or for damage or
g
I
loss to property arising out of or caused by Lessee's operations or activities in connection
with the Project or any contiguous or nonWadjacent property under Lessee's control
except to the extent such injury, damage or Toss is caused by the wrongful acts or
negligence of Lessor.
X4,3 The Lessor and the Lessee agree that in any action based on an allegation of j Dint negligence on the part of the Lessor and the Lessee that each party shall
only be
i responsible for that portion or percentage of any damages awarded which is directly
attributable to the negligence of that party.
14,4 The Lessor and the Lessee must provide the other prompt and timely notice of
any event covered which, in any way, directly, indirectly, contingently or otherwise,
affects or might affect the other, The Lessor may compromise and defend the same to the
extent of its own interests,
15. Insurance
Lessee shall, during the term of this Lease, maintain adequate insurance coverage as
follows:
a. In General, All policies of insurance provided shall be issued by, insurance
companies qualified to do business in the State of Texas and either tl) listed on the U.S. Department of the Treasury's Listing of Approved Sureties (Department
Circular 570} has amended}, or ~Z} having a current rating of "A-" or better in the
most current available A.M. Best too., Inc.'s, Best's Insurance Reports, Property
and Casualty Edition. Except in the case of workers' compensation insurance,
Lessor shall be included as~ an additional named insured on all insurance policies,
Lessee shall cause copies of certificates of insurance to be famished to Lessor
concurrently with or prior to conducting construction-related site inspections,
surveys, etc, associated with this Lease, The certif cafes shall name Lessor as the
certificate holder and as an additional named insured except in the case of
workers' compensation insurance}. ~f requested, Lessee shall also cause copies of
the insurance policies required by this Lease to be provided to Lessor,
b, workers' Compensation Insurance, Lessee shall obtain and maintain during the
term of this Lease workers' compensation insurance as required by laws and
regulations far all of Lessee's employees employed at the Project,
c, Comprehensive Public Liability and Property Damage Liability Insurance, Lessee shall secure and maintain during the term of this Lease a commercial
general public liability and property damage liability insurance policy. The policy
sha11 protect Lessee and Lessor from claims for damages for personal injury,
including accidental death, and from claims for property damage which may arise
from Lessee's operations under this Lease, whether any such operation be by the
Lessee or by anyone directly or indirectly employed by Lessee. The rninimurn
amounts of such insurance shall be not less than $1,000,000 for each occurrence,
l
and $3,OD0,000 general aggregate, and $2,D00,0DQ praductslcornpleted operations
aggregate.
d. Automobile Public Liability Insurance. Lessee shall secure and maintain during
the term of this Lease comprehensive automobile public liability insurance with
limits not less than $1,000,DDD per occurrence, covering owned, hired, and non-
ownedautomobiles.
e. Environmental Impairment Liability Insurance. Lessee shall secure and maintain
during the term of this Lease Environmental Impairment Liability insurance with
limits not less than $1,000,000 per occurrence, covering liability and cleanup
costs associated with discharges or releases of chemicals or other forms of
pollution,
f. Property Insurance, Lessee shall secure and maintain during the term of this
Lease Property Insurance on an All-Risk basis, providing for 100% of the
replacement cast of the Gas ~ Collection System and associated buildings and
equipment.
1 Force Maj eure
16.1 If by reason of Force Majeure either party is unable to carry out, either in whole
or in part, its obligations herein contained, such party shall not be deemed in default
during the continuation of such inability, In this clause, "Force Majeure" means an
exceptional event or circumstance; ~a} which is beyond a party's control, fib} which
such party could not reasonably have provided against before entering into this
contract, ~c) which, having arisen, such party could not reasonably have avoided or
overcome, and ~d} which is not substantially attributable to the other party.
16.E Force Maj eure may include, but is not limited to, the following events or
circumstances, so long as all these conditions ~a} through ~d} above are satisfied; ~i}
acts of Gad, including but not limited to, winds, hurricanes, tornadoes, fires,
epidemics, landslides, floods or earthquakes; (ii) strikes, lock-outs or other industrial
disturbances by persons other than personnel and other employees of the parties; viii} acts of public enemies; and Div} military action, war, whether or not it is declared,
sabotage, riots, civil disturbances or explosions,
16,3 Lessor and Lessee agree that: ~a} the non-performing party, within two weeks
after the occurrence of the Force Ma~eure, shall give -the other party written notice
describing the particulars of the occurrence; fib) the suspension of performance shall
be of no greater scope and of no longer duration than is required by the Force
Majeure; ~c} no obligations of either party which arose prior to the occurrence
causing the suspension of performance shall be excused as a result of the occurrence,
and; ~d) the non-performing party shall use its best efforts to remedy with all
reasonable dispatch the cause or causes preventing it frorn carrying out its
3
obligations, Notwithstanding the foregoing, the other party may, at its option,
terminate this Lease after six months of any such suspension of performance.
17. Assignment
17.I Assignment, Neither party hereto may sell, encumber, assign or transfer this Lease or any interest it may have herein, without the express written consent of the
other party, and upon such written notice the term, conditions and provisions of this i
Lease shall extend and apply to and shall be binding upon the respective heirs,
administrators, executors, successors, assigns and delegates of said party. Upon any
such safe, assignment of transfer of a party's interest herein, the transferring party
shall be relieved of any further obligation hereunder as to the interest sold, assigned
or transferred. Notwithstanding the foregoing, either party may assign this Lease to
an affiliate at least fifty percent X54%} owned without first obtaining the other party's
consent,
17,2 Change of ownership of Landfill, No change or division in ownership of the
Landfill or assigrlrnent of the amounts due hereunder shall operate to enlarge the
obligations or diminish the rights of Lessee, and no change, division or assignment of
such rights shall be binding upon Lessee until thirty X34} days after Lessee has been
furnished with the original or a certified copy of the recorded instrument evidencing
the same,
1$. Notices
Any notice to be given under this Lease shall be in writing and shall be deemed to
have been properly given and received ~i} when delivered in person or via facsimile to the
authorized representative of the party to whom the notice is addressed, or iii} on the date
received as indicated on the return receipt when sent by prepaid certified or registered
mail, return receipt requested, to the party to be notified at its address, as follows,
To Lessee; Mr, Curtis T, Ranger, P.E,
President
. DTE Biomass Energy, Inc.
425 South Main Street, Suite 201
Ann Arbor, Michigan 4S 144
Fax No, 734 6681541
To Lessor; Charles w. Fiedler, P.E. Director of Engineering
City of Denton
641 E. Hickory, Suite B
Denton, TX 76245
Fax No. 944 349-8951
11
Either party may change such representative or address by written notice of said change
of representative or address given to the other party.
19. General Provisions
19,1 Successors. The provisions of this Lease shall insure to the benefit of and be
binding upon the parties hereto and their respective heirs, executors, personal
representatives, administrators, successors and assigns.
19.2 Express Cbligations. All obligations of Lessee and Lessor under this Lease are
expressly stated, and no other obligations or covenants are to be implied hereunder.
19.3 Entire Lease. This Lease is intended by the parties to constitute a complete and
exclusive expression of the agreement with respect to the subj ect matter hereof.
19.4 Modifications, This Lease shall not be changed or modified except by a
subsequent agreement in writing signed by bath parties
19,5 waiver, The waiver by either party of any failure on the part of the other party
to perform in accordance with any of the terms or conditions of this Lease shall not be
construed as a waiver of any future or continuing failure, whether similar or dissimilar thereto,
19.5 Captions, Section and paragraph captions are inserted far identification purposes
only and are not a part hereof.
19,7 Law and Venue. This Lease shall be construed under the laws of the State of
Texas and is fully performable in Denton County, Texas or the appropriate U,S,
District Court. Exclusive venue for a lawsuit enforcing the terms and conditions of
the Lease shall be a court of competent jurisdiction in Denton County, Texas.
19. S Council Approval. This lease shall become effective upon its approval by the
Denton City Council.
~2
CY
9
The parties hereto have executed this Lease as of the day and year first above written. ~
CITY OF DENTON, TEAS
BY:
Michael A, Conduff
City Manager
ATTEST:
BY
~ fifer ~ ~lters
qty S ecretary
APPROVED AS TO FORM:
BY;
Herbert L, Prouty
City Attorney
DTE BIOMASS ENERGY, INC.
BY; r
Cu:~is T. Ranger
President
13
'E
AKNOWLEDGEMENTS
STATE OF TEAS ~
COUNTY OF DENTON ~
his instrument is acknowledged before me, on this ~s da of
Y 2004 by Michael A. Conduff, City Manager of the City of
Denton, a municipal corporation, an behalf of said municipal corporation,
~~''4P~YA~rr~~i, SANE E. R~CHAR~7~~ . ~ ..6 ~ Notary Public, ~tste of ~[~~a~i`' ;
~,N~. ,~y; l1lly Comm~ss~or~ ~x~ire.~. : F:~ , rL~d ~`~~~~qer
~',~;a,„~~,~' ~ur~e 27, 2a~~~, ~ ~ Notar Public in a y nd for
State of Teas
ti. STATE OF ~
COUNTY OF ~
This instrument was acknowledged before me on this day of
, 2084 by Curds T. Ranger, President of DTE Biomass Energy,
a corporation, on behalf of said corporation.
Q~~
Public in and for A ~
State of
S+;~Z''~t%x~''~L~t~:µie;6~~%.-~,Tt~~fi7kL~''((L~:r:{~', ~OR~ ~OWB~E~
Nagy P~biie, Wasilte~aw ~o~r~ty, h~11 My Commission Expires a910~I~OD7
1~
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r
E~chibi~ A
PROJECT S C~EDULE
The following schedule lists several significant activities that are. included within the
Project Scope, These dates represent milestone targets as described in the City of .
Denton's Landfill Gas Rights and Collection Facility Lease,
Date Activity
0411104 Execute the Landfill Gas Rights and
Collection Facility Lease
0711104 Approve preliminary wellfield and plant site design
1011104 ~ ~ Begin operation of Preliminary wellfield
1011106 Execute a Landfill Gas Sales Agreement
1211106 Permit pipeline and plant site construction
0411107 Initiate commercial Landfill Gas sales
j
EXHIBIT 2
AMENDED AND RESTATED
LANDFILL AND DIGESTER GAS RIGHTS AND CGLLECTIGN FACILITY LEASE
This Amended and Restated Landfill Gas and Digester Gas Rights and
Collection Facility Lease ~"Lease"}, dated as of April 15, 2008 the "Effective Date"~ is by
and between the City of Denton, Texas, ahome-rule municipal corporation ~"Gwner" or
"Lessor"} and Denton Power, LLC, a Michigan limited liability company ~''DP" or
"Lessee
WHEREAS, Lessor owns and operates the City of Denton Sanitary Landfill located in
the City of Denton, Texas at 1527 S. Mayhill Road the "Landfill"} and the City of Denton
Water Reclamation Plant located in the City of Denton, Texas at 1100 S. Mayhill Road the
"Water Reclamation Plant Property"}; and
WHEREAS, pursuant to a Request for Proposal by the City of Denton entitled
RFSP #3111 -Professional Services Contract for Design and Development of a Biodiesel
Production Facility, DTE Biomass Energy, Inc. ~"DTE"} and Biodiesel Industries, Inc. made a
Propasal dated November 13, 2003, a copy of which is on file in the Offices of the Denton
City Engineer the "Proposal"}; and
WHEREAS, Lessor and DTE entered into that certain Landfill Gas and Digester Gas Rights and Collection Facility Lease dated April 1, 2004 ~"Griginal Lease"}; and
WHEREAS, DTE has assigned the Griginal Lease to DP, its wholly-owned
subsidiary and Lessor and Lessee desire to amend the Griginal Lease to modify the terms and
conditions of the Griginal Lease;
NGW, THEREFGRE, in consideration of the mutual covenants and agreements set
forth herein, Lessor and Lessee agree as follows:
1. Definitions.
1.1 "BP Facility" shall mean that certain Biodiesel Production Facility located
at the City of Dentan Landfill.
1.2 "BTUIcf 'shall mean British Thermal Units per cubic feet and is defined
as a unit of energy equal to the heat needed to raise the temperature of ane pound of water
from sixty ~6fl} degrees Fahrenheit to sixty-one ~b1} degrees Fahrenheit at a constant
pressure of one standard atmosphere. The BTU equivalent on a dry basis at 14.5 psia may be
obtained by multiplying the BTU so measured by the factor 1.Q12.
-1-
1.3 "Collection System or Gas Collection System" means the network of recovery
wells and interconnecting pipes together with attendant valves, pumps, monitoring devices
and other extraction related equipment installed for the purpose of extracting and
recovering Landfill Gas, including a blower sufficient to deliver the Landfill Gas to a
flare, a condensate recovery system, a flare, gas meter, including any expansions thereof,
including expansions to the Initial Gas Collection System to sell Landfill Gas to a Customer.
1.4 "Commercial Quantities" shall mean volumes of Landfill and Digester Gas for
sale deemed by Lessee to be sufficient in amount for the Project to be economically viable.
Recovery and sale of Landfill Gas and Digester Gas in average monthly volumes of more
than 10QO SCFM and more than a heating value of 450 BTU~CF is presumptively deemed to
be Commercial Quantities, whether this gas is sold directly to an end use customer or used to
generate electricity.
1.5 "Customer" shall mean either ~1} any suitable Landfill Gas and Digester Gas
Purchaser within a reasonable distance of the Landfill or ~2y any purchaser of electricity
generated by Lessee at the Landfill.
1.6 "Delivery Point" shall be ~1} for Landfill Gas, a meter near a flare with blower
on the Landfill and ~2}for electricity, a meter near the interconnect site.
1.7 "Digester Gas" shall mean methane, carbon dioxide and other constituent
products produced by the anaerobic decomposition of waste water and sludge at the
Wastewater Treatment Plant adjacent to the Landfill.
1.8 "Energy" shall mean Landfill Gas or Digester Gas sold to a Customer or
electricity produced from the Landfill Gas or Digester Gas and sold to a Customer
1.9 "Expanded Gas Collection System" means that portion of the Gas Collection
System built or to be built in addition to the Initial Gas Collection System.
1.10 "Gross Revenues" shall mean the total money received by Lessee before any
adjustment thereto, from sales of Energy to the Customer.
1.11 "Initial Gas Collection System" shall mean that portion of the Collection
System built by the City of Denton in support of Biodiesel Production.
1.12 "Landfill Gas" shall mean methane, carbon dioxide and other constituent
products produced by the anaerobic decomposition of refuse material within the
Landfill. It is personal property and does not include oil, gas, or other mineral interests in real
property.
1.13 "MMBtu" shall mean one million BTUs.
1.14 "Modifications" shall mean Gas Collection System modifications for the
expansion of the number of collection wells and the connection of such wells to the Gas
Collection System.
1.15 "Operate and Maintain" shall mean day-to-day operation and maintenance of
the Gas Collection System, any pipeline to an end use Customer, and any electrical
interconnection facilities tthe "Facilities"). This day-to-day operation and maintenance shall
be done in accordance with air regulatory parameters, and shall include providing personnel
to operate the Facilities and perform Gas Collection System maintenance excluding the
digester methane pipeline from the WWTP to the flare station connection}, which shall
include changing filters, taking down system for rework, flare system maintenance repairs
including replacement of worn out components, repairs to wellheads and the piping systems
connecting them to the flare station, but shall not include any incremental capital investment
required to expand the Gas Collection System, which is expressly the obligation of Lessor
1.16 "Project" shall mean all activities and efforts associated with either ~1} the
recovery and sale of Landfill Gas and Digester Gas and their delivery to a Customer or ~2}
generation of electricity from Landfill Gas and delivery of the electricity to a Customer.
1.17 "Project Schedule" shall mean the proposed schedule attached hereto as
Exhibit "A" and made a part hereof by reference.
1.18 "SCFM" shall mean standard cubic feet of Landfill Gas and Digester Gas per
minute, measured at sixty degrees Fahrenheit X60 degrees F} and at a pressure of fourteen and
seventy-three one hundredths X14.73}pounds per square inch absolute (psia}.
1.19 "Wastewater Treatment Plant" ~WWTP} shall mean that certain wastewater
treatment plant belonging to the City of Denton, Texas and more specifically located at 1100
S. Mayhill Road.
2. Term
This Lease is dated effective on the Effective Date as set forth in the first paragraph
of this Lease and shall continue until March 31, 2424, which is a term of twenty X20)
years from the effective date of the Original Lease.
3. Rl hts Granted tv Lessee
Subject to the provisions of this Lease, Lessor hereby grants to Lessee the following:
3.1 Landfill Gas and Di ester Gas. The exclusive right to explore for, extract,
collect, process, use, se11 and deliver all Landfill Gas from the Landfill and Digester Gas from
the City's wastewater Treatment Plant, except that Landfill Gas which is required for the
BP Facility, up to a maximum amount of 50 scfm, and Digester Gas used internally at the
Wastewater Treatment Plant. This right is subordinate to Lessor's right to use the Landfill for
landfill purposes and its right to use the Water Reclamation Plant Property for water
reclamation purposes. However, Lessor agrees to cooperate with Lessee in all reasonable
manners necessary to carry aut Lessee's rights under this Lease. In the event that the BP
Facility is expected to require more landfill gas than the 50 scfm that the BP Facility is
capable of utilizing as of the effective date of this Lease, Lessee and Lessor shall work
together in good faith with each other and with the operator of the BP Facility to enter into
terms pursuant to which the BP Facility can utilize either excess Landfill Gas above what
Lessee is using or Digester Gas from the Wastewater Treatment Plant.
3.2 Gas Collection_ System. The exclusive right to use and operate a Gas
Collection System at the Landfill other than that which is required for the BP Facility, subject
to the restrictions in 3.1 and the Lessor's rights set forth in Section 3.1. Such right and related
activities encompass the right to conduct all activities necessary and incidental to the
operation and maintenance of a Gas Collection System, which includes the right, but not the
obligation, to install underground gas transmission pipes, operate associated gas collection
equipment, and other related equipment. The cost of additional well drilling to comply
with Texas environmental laws or to enhance Landfill Gas callection as recommended
by the Lessor's Landfill Gas System engineer or Lessee and agreed to by both parties,
will be borne by the Lessor. Lessee will notify Lessor in writing of Modifications, that
need to be made to enhance Landfill Gas collection or comply with Texas environmental
laws After receipt of notice from Lessee, Lessor will make such Modifications within six
~6} months the "Modification Period"}. If Lessor does not make such Modifications
within the Modification Period, then Lessee may make such Modifications and offset any
payments to Lessor under this Agreement by the cast of such Modifications, after
providing Lessor with fifteen X15} business days of written advance notification of its
intent to do so.
The cost to operate and Maintain the Gas Collection Facility, and related pipeline or
electrical interconnection facilities, if any, to the Customer shall be borne by Lessee provided
that: ~1} the Landfill Gas and Digester Gas volumes and quality produced by the Landfill
and Wastewater Treatment Plant, less the amount of Landfill Gas provided to the BP
Facility meet the standard of Commercial Quantities as defined in Paragraph 1.4, and ~2}
the Gas Collection System is suitable for use by both the BP Facility and the Customer.
Lessor's failure to complete the entire Gas Collection System, as designed by the Lessor, over
and above the Gas Collection System portion required for the BP Facility, by one year from the
Effective Date of this Agreement is cause for termination by the Lessee.
3.3 Plant Site. For $1.00 per year and other good and valuable consideration,
Lessor shall make available to Lessee a mutually acceptable site of approximately two
hundred feet ~2D4 ft.} by three hundred feet X340 ft.} in size to accommodate the
construction and operation of the gas processing plant and related facilities or electrical
generation facilities and related facilities. Lessee shall have the right of free ingress and
egress at all times to and from such site for itself and its Customers, provided that such
ingress and egress is consistent with appropriate security measures imposed by Lessor and is
subordinate to Lessor's use of the Landfill for landfill purposes. Lessor and Lessee shall in
good faith mutually agree on a suitable location or locations for such access that does not
interfere with Lessor's Landfill operations.
4, Payments to Lest
4.2 Ro alt Lease Pa ment. Lessee agrees to pay Lessor twelve and one-half
percent ~~2.5%} of Gross Revenues from the sale of Energy, which shall additionally
include the value of any Renewable Energy Credits created through the generation of
electricity from Landfill Gas if the Renewable Energy Credits are sold under a
separate contract from the electricity, to all Customers exclusive of any applicable taxes
to the Project provided that Landfill Gas and Digester Gas volumes and quality conform with
the definition of Commercial Quantities found in Paragraph 1,4 hereof. Landfill Gas
provided to the BP Facility is not subject to royalty payments.
These royaltyJlease payments shall be paid each calendar quarter to Lessor on or before the
last day of the month following the close of the calendar quarter the "Payment Date"} with
the first payment being due and payable by Lessee to Lessor on the Payment Date
immediately following the first calendar quarter in which the Gas Collection System
and gas processing plant or electric generating facility, as appropriate, become
operational. Along with such payments Lessee shall provide documentation to Lessor
evidencing all Gross Revenues. Lessor shall have the right at all reasonable times to
audit the records of Lessee to determine that the royaltyJlease payments have been properly
computed.
4.2 Cantin eat Lease Pa meats. Lessee represents that the sale of Landfill Gas
from the Landfill does not currently entitle Lessee to claim Internal Revenue Code Section
29 Production Tax Credits. In the event Congress enacts Production Tax Credits, entitling
Lessee to claim such credits or benefits or if Lessee is able to claim Section 45 Production
Tax Credits for electricity generation, Lessee agrees to pay Lessor a further additional Lease
payment equal to twenty ~2D%} percent of the value of those new tax credits or benefits to the
Lessee no later than ninety X90} days after the calendar year for which the tax credit, if
applicable, is claimed by Lessee. If no tax return is yet filed, then such additional payment
shall be nonetheless be calculated by Lessee and be due and payable to Lessor no later than
ninety X90}days following the end of the applicable calendar year.
5. Lessee's Ubli ations. Provided Commercial Quantities are available, Lessee agrees to
Operate and Maintain the Gas Collection System. Lessor shall have to right to monitor
Lessee's performance of such. Nothing in this Lease shall be construed as Lessee assuming
any of those obligations imposed by law upon Lessor as owner of the Landfill, including
compliance with environmental laws, unless such obligations are caused by Lessee or are
expressly assumed by Lessee, ar any obligation to drill wells, re-work wells or connect any
wells to the Collection System.
b, Lessor's Ubl~ations. Lessor agrees to ~a} cooperate in the construction,
development and operation of its Landfill, its Wastewater Treatment Plant, and the Gas
Collection System sa as to maximize the production of Landfill Gas and Digester Gas and
the transportation of Landfill Gas and Digester Gas or electricity, as applicable, to the
Delivery Point; fib} not unreasonably interfere with the Lessee's operation of the Project or
cause the disruption or destruction of the biological decomposition of refuse material within
the Landfill; ~c} prevent any of its independent contractors from committing such
interference, disruption, or destruction; ~d} promptly repair all cracks, fissures, erosion
or physical changes in, of, or ta, the interim and final covers at the Landfill which have an
adverse material effect on the production of Landfill Gas; fie} cooperate in the construction,
development, operation and maintenance of the Pra jest and the Collection System at the
Landfill; ~f} comply with all applicable federal, state, county, municipal and local laws,
statutes, rules, regulations, ordinances, codes, restrictions, requirements, obligations and
permitting requirements relating to the management and operation of the Landfill, including
all environmental laws pertaining to the Collection System, provided such laws are
specifically imposed upon Lessor and have not been imposed upon Lessee or expressly
assigned and accepted by Lessee fig} approve in a timely manner all reasonable and
appropriate Project design plans, specifications, and requisite construction activities which
involve Lessor's property; ~h} construct the pipeline from the Waste Water Treatment plant to
the Landfill flare; ~i} construct the Expanded Gas Collection System as designed by Lessor, to
be completed by June 30, 20D8 at the latest; and ~j} update the Gas Collection System from
time to time as determined by Lessor or as requested by Lessee pursuant to Section 3.2 hereof,
in order to maximize the production of Landfill Gas.
7. Emission Credits
Ta the extent Pollution Cantral Emission Credits ar Carbon Credits through a voluntary
or non-voluntary program are available to the Project, the value of such Emission Credits or
Carbon Credits, if any, shall belong to Lessee.
S. Construction and Maintenance of Facilities
8.1. Lessee shall not be responsible in any way for the construction, operation,
or maintenance of the BP Facility. Such construction, operation, and maintenance is
covered and addressed by a separate agreement between the Lessor and Biodiesel Industries,
Inc.
8,2. Lessee shall be responsible for reviewing the design of the Gas Collection
System and the construction of the pipeline from the Delivery Point to the Customer or the
power delivery facilities, as applicable, at its expense. As otherwise provided in this
Agreement, Lessee has the responsibility to operate and Maintain the Gas Collection System.
8.3. Lessor shall be responsible far the design and construction of the Initial Gas
Collection System and the Expanded Gas Collection System, including any Modifications,
related infrastructure lying within the Landfill property boundaries and the pipeline from
the Wastewater Treatment Plant to the landfill flare, at its expense.
9. Surrender.
Upon thirty X30} days notice to Lessor, Lessee may at any time ar times, surrender and
terminate this Lease without liability, if Lessee is prevented due to no fault of its own
from meeting the milestones set forth in Exhibit A entitled Project Schedule, or ~2} Landfill
Gas cannot be recovered or sold from the Landfill in Commercial Quantities In the event
that Lessee terminates this Lease pursuant to this section, Lessee will be relieved of all
obligations except for surrendering the Gas Collection System in good operational condition
and transferring any of the Improvements has defined in Section 10.4} that Lessor elects to
purchase from Lessee as described in Section 11}.4 hereof, in good operational condition,
performing removal and restoration activities in accordance with Section 10, as applicable,
and making fu11 payment to Lessor for obligations incurred as of the date of termination, asset
forth in Section 4 of this Lease.
10. Lessor and Lessee Ri hts
10.1. Landfill Use. Lessee shall be authorized to use the Landfill, upon notification
to Lessor, without cost, to the extent reasonably necessary or convenient for Lessee to carry
out its obligations hereunder. Such use is subordinate to Lessor's use of the Landfill for
Landfill purposes.
10.2. GiIL Natural Gas, Mineral Rights. This Lease shall not be deemed to grant
Lessee any rights or interests in any oil, natural gas, or other minerals located in the Landfill
real property but is only a lease of Landfill Gas and Digester Gas.
10.3. Coo eration in Gbtainin Authorization. Upon request by Lessee, Lessor shall
reasonably assist Lessee in any proceedings, hearings or other procedures necessitated by any
required zoning laws, environmental impact reports, governmental permits,
authorizations and similar type requirements, related to the Project and the construction and
operation of the Facilities. Upon request, Lessee sha11 assist Lessor in briefing the
officials of any governmental agency or body, or any other interested party, with
respect to the status of the Project.
10.4. Removal of Facilities. If Lessor does not exercise its right to purchase
Lessee's above-ground property, fixtures and improvements, as described below, then Lessee
shall have an obligation, within six fib} months after the expiration or termination of this
Lease, to remove the above-ground property, fixtures and improvements which Lessee has
placed on or adjacent to the Landfill and to cap any transmission gas lines at the
boundary of the Landfill. Lessee has no obligation to remove any underground property,
fixtures and improvements which Lessee has placed underground in or adjacent to the
Landfill, and upon termination or expiration of this Lease, all such underground property,
fixtures and improvements revert automatically to Lessor. Lessee hereby grants to Lessor
an option to purchase any of such above-ground property, fixtures and improvements the
"Improvements"} at a price equal to Lessee's cost of the Improvements. The cost of the
Improvements wi11 be established within 90 days after the completion of any and all of the
Improvements by written notice from Lessee to Lessor along with supporting documentation
to establish such cost the "Improvements Price"}. within 90 days after the expiration or
termination of this Lease, Lessor may elect to purchase the Improvements, or any part
thereof, for the Improvements Price, or applicable price of a part thereof, by providing
Lessee written notice of the election of the option. The purchase of the Improvements wi11 be
consummated within 9D days thereafter. At closing, in exchange for the Improvements
Price, Lessee sha11 deliver to Lessor a bill of sale transferring the Improvements to Lessor,
free and clear of all debts and liens. Lessee grants an option only on that equipment which was
installed by Lessee.
10.5. Surface Restoration. Lessee sha11, upon expiration or termination of this
Lease, generally restore the surface of the Landfill affected by its operations to its
condition at the commencement of this Lease to the extent reasonably possible. Pipes on
landfill easements shall be sealed and capped at Landfill property boundary, unless Lessor
elects to purchase the Improvements as provided in Section 10.4 above.
10.6. Return to Landfill Matter. Lessee shall, in connection with its operations on
the Landfill, have the right in its sole discretion, to return to the Landfill consistent with
Lessor's Landfill operating permits and environmental regulations any and all matter
either solid or liquid including all condensate from the Project resulting from the Lessee's
Gas Collection System operation and maintenance}.
11. Warrant
Lessor represents and warrants that it has title to the Landfill Gas and Digester
Gas. Lessor covenants to Lessee the right of quiet enjoyment of the use of the Gas
Collection System sa long as Lessee is not in default. Lessee acknowledges that the Landfill Gas and Digester Gas is personalty and not an oil, gas, or mineral
interest in real
property.
12. Default
12.1 Default b Lessee. In the event that Lessor concludes that Lessee's
operations, excluding the provisions of the Project Schedule, are at any time not being
conducted in material compliance with the provisions of this Lease, or Lessee fails to
actively and diligently pursue or operate the Facilities under this Lease, Lessor shall notify
Lessee in writing of the facts relied upon as constituting a default hereunder, and Lessee, if in
default, shall have sixty X60} days after receipt of such notice in which to complete or
substantially complete compliance with such provisions. Lessor shall have the right to
terminate this Lease upon written notice to Lessee if Lessee fails to complete or
substantially complete such compliance efforts within the sixty X64} day period, unless such
failure is excused by the provisions of Section 15 hereof. If compliance within sixty X64}
days is not reasonably possible and Lessee has commenced and is diligently pursuing
such compliance efforts, Lessee shall be allowed additional time to complete compliance, not
to exceed an additional ninety ~90} days, but only if written notice of an extension is given to
Lessor by Lessee within the first sixty ~6D} day period. Notwithstanding anything
contained herein to the contrary, upon termination of this Lease, due to a default by Lessee the
Gas Collection System shall revert back to Lessor in good operating condition at no cast to the
Lessor, the Lessor shall have the option to purchase the Improvements as set forth in Section
10.4, and the Landfill Gas rights shall be surrendered to Lessor.
12.2 Default bye r. In the event that Lessee concludes that Lessor at any time
is failing to perform or observe any of the provisions of this Lease required to be performed or
observed by Lessor, Lessee shall notify Lessor in writing of the facts relied upon as
constituting a default hereunder, and Lessor, if in default, shall have ninety X90} days after
receipt of such notice in which to complete or substantially complete compliance with such
provisions. Lessee shall have the right to terminate this Lease upon written notice to Lessor
if Lessor f ails to complete or substantially complete such compliance efforts within the ninety
X90} day period, unless such failure is excused by the provisions of Section 17 hereof. If
compliance with ninety X90} days is not reasonably possible and Lessor has cornmenced and
is diligently pursuing such compliance efforts, Lessor shall be allowed additional time to complete compliance, not to exceed an additional ninety X90} days,
but only if written
notice of an extension is given to Lessee by Lessor within the first ninety X90} day period.
13. Indemnification
13.1 Lessor shall defend, indemnify and hold Lessee harmless to the extent
permitted by applicable law from and against any and all claims, demands, actions,
proceedings, liability or losses, of whatsoever nature including reasonable attorney's fees}
for injury or death to persons} or for damage or loss to property arising out of or caused
by Lessor's operations or activities in connection with the Landfill, or any contiguous or
non-adjacent property under Lessor's control except to the extent such injury, damage
or loss is caused by the wrongful acts or negligence of Lessee.
13.2 Lessee shall defend, indemnify and hold Lessor harmless from and against
any and all claims, demands, actions, proceedings, liability or losses, of whatsoever nature
including reasonable attorney's fees} for injury or death to personas} or for damage or
loss to property arising out of or caused by Lessee's operations or activities in connection
with the Project or any contiguous or non-adjacent property under Lessee's control
except to the extent such injury, damage or lass is caused by the wrongful acts or
negligence of Lessor,
13.3 Lessor, to the extent permitted by applicable law, and Lessee agree that in
any action based on an allegation of joint negligence on the part of Lessor and Lessee
that each party shall only be responsible for that portion or percentage of any damages
awarded which is directly attributable to the negligence of that party.
13.4 Lessor and Lessee must provide the other prompt and timely notice of any
event covered which, in any way, directly, indirectly, contingently or otherwise, affects
or might affect the other. Lessor may compromise and defend the same to the extent of its
own interests.
14. Insurance. Lessee shall, during the term of this Lease, maintain adequate insurance
coverage as follows:
14.1 General Insurance. Certificates of insurance covering all of the insurance
required to be maintained by Lessee shall be filed with the Lessor . Lessor shall be named as
an additional insured under the commercial general liability policy, using IS4-Form CG 201.0
latest edition, or equivalent}. All such policies shall be from insurance companies which are
reasonably acceptable to Lessor , All insurance policies shall contain the provision that the
insurance company will provide written notice to the Lessor no less than thirty X30) days
prior to any material change, termination or cancellation of coverage, All insurance policies
shall provide that all deductibles shall be for Lessee's account, and all such insurance
policies shall be primary and not contributory with Lessor's insurance.
14.2 Workers' Compensation Insurance. Workers' Compensation including
occupational disease in accordance with the statutory requirements set forth by the state in
which the Work is to be performed and employer's liability insurance covering all of
Lessee's employees engaged in the performance of this Agreement, shall be maintained
continuously for the term of this Lease..
14.3 Cam rehensive Public Liabilit and Pro ert Dama e Liabilit Insurance.
Lessee shall secure and maintain during the term of this Lease a commercial general
public liability and property damage liability insurance policy. The policy shall protect
Lessee and Lessor from claims for damages for personal injury, including accidental
death, and from claims for property damage which may arise from Lessee's operations
under this Lease, whether any such operation be by the Lessee or by anyone directly or
indirectly employed by Lessee. The minimum limits of such insurance shall be $2,000,000
per occurrence and $5,000,000 in the aggregate.
14.4 Automobile Public Liabilit Insurance. Comprehensive automobile liability
insurance covering Lessee for claims arising from owned, hired and non-owned vehicles
covering death or bodily injury and property damage with a combined single limit of a
minimum sum of $1,000,000 per occurrence. .
14.5 Environmental Impairment Liability ,Insurance. Lessee shall secure and
maintain during the term of this Lease Environmental Impairment Liability insurance with
limits not less than $1,000,000 per occurrence, covering liability and cleanup costs
associated with discharges or releases of chemicals or other forms of pollution.
15. Force Mai eure
15.1 If by reason of Force Majeure either party is unable to carry out, either in
whole or in part, its obligations herein contained, such party shall not be deemed in default
during the continuation of such inability. In this clause, '"Force Majeure" means an
exceptional event or circumstance: ~a} which is beyond a party's control, ~b}which such party
could not reasonably have provided against before entering into this contract, ~c} which, having arisen, such party could not reasonably have avoided or overcome, and ~d}which is
not
substantially attributable to the other party.
15.2 Force Majeure may include, but is not limited to, the following events or
circumstances, so long as all these conditions ~a} through ~d) above are satisfied: ~i) acts of
God, including but not limited to, winds, hurricanes, tornadoes, fires, epidemics,
landslides, floods or earthquakes; iii} strikes, lock-outs or other industrial disturbances by
persons other than personnel and other employees of the parties; iii} acts of public enemies;
and ~iv) military action, war, whether or not it is declared, sabotage, riots, civil disturbances or
explosions.
15.3 Lessor and Lessee agree that: ~a} the nonperforming party, within two weeks
after the occurrence of the Force Majeure, shall give the other party written notice
describing the particulars of the occurrence; fib} the suspension of performance shall be of
no greater scope and of no longer duration than is required by the Force Majeure; ~c} no
obligations of either party which arose prior to the occurrence causing the suspension of
performance shall be excused as a result of the occurrence, and; ~d} the non-performing
party shall use its best efforts to remedy with all reasonable dispatch the cause or
causes preventing it from carrying out its obligations. Notwithstanding the foregoing,
the other party may, at its option, terminate this Lease after six months of any such
suspension of performance.
16. Assignment
16.1 Assi ent. Neither party hereto may sell, encumber, assign or transfer this
Lease or any interest it may have herein, without the express written consent of the other
party, and upon such written notice the terms, conditions and provisions of this Lease shall
extend and apply to and shall be binding upon the respective heirs, administrators,
executors, successors, assigns and delegates of said party. Upon any such sale, assignment
of transfer of a party's interest herein, the transferring party shall be relieved of any
further obligation hereunder as to the interest sold, assigned or transferred.
Notwithstanding the foregoing, either party may assign this Lease to an affiliate at least
fifty percent X50%} owned by Lessee without first obtaining the other party's consent.
16.2 Chan e of Ownershi of Landfill, No change or division in ownership of the
Landfill or assignment of the amounts due hereunder shall operate to enlarge the obligations
or diminish the rights of Lessee, and no change, division or assignment of such rights
shall be binding upon Lessee until thirty X30} days after Lessee has been furnished with the
original or a certified copy of the recorded instrument evidencing the same.
17. Notices
Any notice to be given under this Lease shall be in writing and shall be deemed to
have been properly given and received (i} when delivered in person or via facsimile to the
authorized representative of the party to whom the notice is addressed, or iii} on the date
received as indicated on the return receipt when sent by prepaid certified ar registered mail,
return receipt requested, or by recognized overnight courier, such as Federal Express, to the
party to be notified at its address, as follows:
To Lessee: President
Denton Power, LLC
425 South Main Street, Suite 201
Ann Arbor, Michigan 48104
Fax No, 734 668-1541
Assistant General Counsel
DTE Biomass Energy, Inc.
425 South Main Street, Suite 201
Ann Arbor, Michigan 48104
Fax No. 734-913-5582
To Lessor; Vance Kemler
General Manager, Solid Waste Services
City of Denton
1527 S. Mayhill Road
Denton, T~ 76208
Fax No. 940349-8457
George C. Campbell, City Manager
City of Denton
215 East McKinney Street
Denton, Texas 7621
Fax Na.940-349-8457
Either party may change such representative or address by written notice of said change of
representative or address given to the other party.
18. General Provisions
18.1 Successors. The provisions of this Lease shall insure to the benefit of and
be binding upon the parties hereto and their respective heirs, executors, personal
representatives, administrators, successors and assigns.
18,2 ExpressGbli ag Lions. All obligations of Lessee and Lessor under this Lease
are expressly stated, and no other obligations ar covenants are to be implied hereunder.
18.3 Entire Lease. This Lease is intended by the parties to constitute a complete
and exclusive expression of the agreement with respect to the subject matter hereof.
18.4 Modifications. This Lease shall not be changed or modified except by a
subsequent agreement in writing signed by both parties.
18.5 Waiver. The waiver by either party of any failure on the part of the other
party to perform in accordance with any of the terms or conditions of this Lease shall not be
construed as a waiver of any future or continuing failure, whether similar or dissimilar
thereto.
15.6 Ca bons. Section and paragraph captions are inserted for identification
purposes only and are not a part hereof
15.7 Law and Venue. This Lease shall be construed under the laws of the State of
Texas and is fully performable in Denton County, Texas or the appropriate U.S. District
Court. Exclusive venue for a lawsuit enforcing the terms and conditions of the Lease shalt be
a court of competent jurisdiction in Denton County, Texas.
18.8 Alternative Dis ute Resolution. The parties agree that, if necessary, they will
first use their best efforts to resolve any disputes regarding this Agreement through the use of
mediation or other form of alternate dispute resolution in Denton County, Texas, as set forth
in Chapter 154 of the Texas Civil Practice and Remedies Code ~V.A.T.C.A.}. only if there is
a dispute involving a serious immediate material breach or a threat of serious immediate
material breach of this Agreement by either side, where to engage in alternate dispute
resolution would be futile, are the parties justified in seeking injunctive relief from a Court of
competent jurisdiction in Denton County, Texas.
18.9 Audit R~hts. Lessor shall have the right to audit and make copies of the
books, records, and computations pertaining to this Lease. Lessee shall retain all books,
records, documents, and other evidence pertaining to this Lease for a period of three ~3}
years, except if an audit is in progress or audit findings are yet unresolved, in which case
records shall be kept until all audit tasks are completed and resolved. These books, records,
documents, and other evidence shall be available for Lessor's review, within ten ~1D}
business days of Lessor's written request. All books and records will be made available
within a fifty DSO} mile radius of the City of Denton, Texas, provided, however, that Lessee
shall have the right to send records via mail or electronic files. The cost of any audit will be
borne by the Lessor unless the audit reveals an overpayment or underpayment of 2% or
greater, in which case the reasonable cost of the audit shall be borne by the party in error.
Any payment due under this provision shall be made within thirty X30} business days of
receipt of an invoice therefor, provided that if Lessee has an issue with the invoice, it shall let
Lessor know within fifteen ~~S}business days of receipt of such invoice.
Each of the terms "books " "records " "documents "and "other evidence" as used in this
section, shall be construed to include drafts and electronic files, even if such drafts or
electronic files are subsequently used to generate or prepare a final printed document.
{The next page is the signature page }
The parties hereto have executed this Lease as of the day and year first above written.
CITY OF DENTON, TEXAS
A Texas Municipal Corporation
By:
Name:
Title:
ATTEST:
Jennifer Walters, City Secretary
By•
APPROVED AS TO LEGAL FORM:
EDWIN M. SNYDER, CITY ATTORNEY
By:
DENTON POWER, LLC
By•
~ Name: ~ ~
Title: ~
~ , q~► i
l
5
Exhibit A
PROJECT SCHEDULE
The following schedule lists several significant activities that are included within the
Project Scope. These dates represent milestone targets as described in the Amended and
Restated Landfill Gas Rights and Collection Facility Lease. These milestones are targets
only and any failure to meet any one or more of the specific dates set forth below shall not be
deemed, by itself, to be an event of default under the Amended and Restated Landfill Gas
Rights and Collection Facility Lease.
Date Act_ ivit~
April, 2008 Execute the Amended and Restated Landfill Gas Rights and
Collectian Facility Lease
April -May, 2008 Begin operation of Initial Wellfield
June, 200$ Execute an Energy Sales Agreement with purchaser of electricity
Fall, 2008 Permit and construct plant
December 31, 200$ Initiate commercial Energy sales
EXHIBIT 3
ORDINANCE N0.2008-
AN ORDINANCE APPROVING AN AMENDED AND RESTATED LANDFILL AND
DIGESTER GAS RIGHTS AND COLLECTION FACILITY LEASE BETWEEN DENTON
POWER, LLC. AND THE CITY OF DENTON, TEXAS PROVIDING FOR THE
EXTRACTION, COLLECTION, PROCESSING, USE, SALE, AND DELIVERY OF
LANDFILL GAS FROM THE CITY'S LANDFILL, AND DIGESTER GAS FROM THE
CITY'S WASTEWATER PLANT, AUTHORIZING THE EXPENDITURE OF FUNDS
THEREFOR; AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, on January 28, 2008 the Public Utilities Board of Denton considered this
amended and restated lease transaction and recommended approval thereof by a vote of 7-0.
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The City Manager, or his designee, is hereby authorized to execute and
deliver the "Amended and Restated Landfill and Digester Gas Rights and Collection Facility
Lease between Denton Power, LLC and the City of Denton, Texas" (hereafter the Amended
Lease), in substantially the form as set forth in the Amended Lease attached hereto and made a
part of this ordinance for all purposes.
SECTION 2. The City Manager is authorized to make the expenditures and perform
such duties as are set forth in the attached Amended Lease.
SECTION 3. That this ordinance shall become effective immediately upon its passage
and approval.
PASSED AND APPROVED this the day of February, 2008.
PERRY R. McNEILL, MAYOR
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
By:
APPROVED AS TO LEGAL FORM:
EDWIN M. SNYDER, CITY ATTORNEY
By:
AGENDA INFORMATION SHEET
Agenda Date: April 15, 2008
Department: Utilities
ACM: Howard Martin, 349-8232
SUBJECT
Consider approval of a resolution of the City Council of the City of Denton, Texas approving the
execution by the city of the "Air North Texas Partner Agreement" of the North Central Texas
Council of Governments and the Regional Transportation Council, wherein the City of Denton
supports the principles, goals, activities and recommendations of the partnership; and providing
an effective date.
BACKGROUND
The primary goal of air quality management is the protection of public health and welfare and
reducing the health impacts caused predominantly by mobile-source emissions, with the
assistance of partnering entities, while preserving the economic vitality of the region.
To respond to these challenges, the North Central Texas Council of Governments has developed
the Air North Texas public education campaign. The goal of forming this public education
campaign is to disseminate a consistent and constantly reinforced regional message concerning
air quality issues. If the City of Denton chooses to become a partner in this effort, the City will,
at a minimum, be expected to commit to:
• Voluntarily disseminating campaign materials in order to develop a regional awareness,
which will hopefully foster behavioral changes that will lead to improved air quality.
• Including the Air North Texas brand/logo on air quality information. The City will, in
return, have the City of Denton logo placed in the partner area of the Air North Texas
we site.
~ Sponsoring or participating in one or more public events designed to increase awareness
of the Air North Texas campaign and the air quality challenges faced by the region.
FISCAL INFORMATION
There is no monetary commitment to become an Air North Texas Partner. Existing Air Quality
education materials can be revised to include the Air North Texas logo, and the logo can easily
be incorporated into new materials.
OPTIONS
1. No Action
2. Approve Resolution authorizing City of Denton to execute Air North Texas Partnership
Agreement and become an Air North Texas Partner.
PRIOR ACTION
This item was presented to City Council Committee on the Environment April 7, 2008. The
Committee directed staff to forward Resolution to City Council for consideration.
RECOMMENDATIONS
1. Staff recommends approval of Resolution authorizing City of Denton to execute Air North
Texas Partnership Agreement and become an Air North Texas Partner.
EXHIBITS
1. Air North Texas Partnership Agreement
2. Air North Texas Resolution
3. COE Meeting Minutes
Respectfully Submitted:
Katherine Barnett
Special Proj ect Coordinator
EXHIBIT 1
AIR NORTH TEXAS PARTNER AGREEMENT
WHEREAS, the Regional Transportation Council, comprised primarily of local
elected officials, is the regional transportation policy body associated with the North
Central Texas Council of Governments, and has been and continues to be a forum for
cooperative decisions on transportation; and,
WHEREAS, the is a that supports the Regional Transportation Council and the goals and mission statements of the Air
North Texas campaign; and,
WHEREAS, the Dallas-Fort Worth area is a federally designated nonattainment area
for the pollutant ozone and air quality impacts the public and economic health of the
entire region; and,
WHEREAS, the primary goal of air quality management is the protection of public
health and welfare, reducing and improving the health impacts caused predominantly by
mobile-source emissions with the assistance of partnering entities while preserving the
economic vitality of the region; and,
WHEREAS, the North Central Texas Council of Governments has formed alliances
with public and private entities in the region to assist and support in the development of
the Air North Texas campaign elements, and the dissemination of information; and,
WHEREAS, the Air North Texas campaign is a collaborative initiative involving
partners from public, private and non-profit entities that will promote a consistent
regional message; and,
WHEREAS, the Air North Texas campaign is committed to increasing air quality awareness to citizens and residents in the North Texas region; and,
AIR NORTH TEXAS PARTNERS PLEDGE TO ACKOWLEDGE AND
ACCOMPLISH THE FOLLOWING, AS IT APPLIES OR AS APPROPRIATE:
Section 1. Air North Texas Goal and Mission Statement
1.1 A voluntary effort and creative platform to develop a regional brand to generate increased awareness that will
foster behavioral changes to improve air quality
1.2 An all-inclusive branding effort that will serve to bridge
existing and developing air quality programs into one
comprehensive and mutually complementary initiative
Section 2. Air North Texas Support to Partners
2.1 Promotion and placement of partner logos on
www.airnorthtexas.org
2.2 Air North Texas partners will be promoted and recognized
throughout the run of the campaign as a regional partner,
generating consistent brand visibility
2.3 Sample press releases are available for download online
2.4 Advertising collateral and campaign materials are available
for download online
2.5 Partner recruitment tools will be provided to aid in the
process of soliciting new and potential members
2.6 Shared results generated from the annual performance
evaluation process
2.7 Shared results generated from audience survey
Section 3. Partners Support to Air North Texas (where applicable and as
appropriate)
3.1 Branding
3.1.1 Placement of the AirNorth Texas brandllogo on
relevant printed collateral forairquality efforts and
initiatives, or where applicable
3.1.2 Provide a link to the official Air North Texas
campaign Web site on your Web site. Air North
Texas Web site buttons are available for download
or the URL can be listed that shows the link:
www.airnorthtexas.org
3.2 Implementation
3.2.1 Air Quality Education and Outreach
a. Plan, host andlor participate in one or more
public event to generate awareness of the Air
North Texas campaign
b. Plan, host andlor support one or more press,
promotional, or partner recognition event for
media or other stakeholders
c. Recruit and encourage general public audience
to sign up as an Air North Texas member to promote clean air
3.2.2 Shared Resources (non-monetary)
a. Assist new and existing partners by providing
guidance and resources needed to fulfill partner
commitments (resources may be in the form of
promotional/educational materials, marketing
collateral, and services)
b. Provide discounted or complementary services to Air North Texas partners for article
placement, advertising, conference registrations
andlor other events that promote the
partnership andlor campaign
3.2.3 Media Relations
a. Issue one or more press releases} announcing
your membership and participation in the Air
North Texas campaign. Sample press releases
and boilerplate information are available for download on our Web site
b. Each quarter, publicize your organization's
involvement with the Air North Texas campaign.
Sample advertising collateral are available for
download from the Air North Texas Web site
3.2.4 Regional Partner Recruitment and Solicitation
a. Inform your members or constituents about the partnership and promote the benefits of being
involved in the regional initiative
b. Publish articles or other informational materials
endorsing the partnership
c. Identify and provide opportunities for Air North
Texas partners to communicate with your
members or constituents about the Air North
Texas campaign and the partnership
d. Recruit new Air North Texas partner(s) to assist
in the planning and implementation of this
regional air quality collaborative effort
3.2.5 Progress Reporting 1 Annual Recognition
a. Provide an annual status report on
implemented tasks
b. Share and exchange information with Air North Texas partners highlights and successes of
your promotional efforts
c. Qualify and/or participate in annual recognition
event for partners and members of the Air North
Texas community
d. Distribute a survey about the Air North Texas
campaign's overall performance to your
member and/or constituents
This partner agreement is anon-binding mutual expression of cooperation to support the
principles outlined in section 1. This agreement is not intended to confer or create a
financial obligation or expectation of payment to or from an Air North Texas Partner, the
North Central Texas Council of Governments, or the Regional Transportation Council.
Execution Date
Name
Title
Entity
EXHIBIT 2
RESOLUTION N0. R2008-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS
APPROVING THE EXECUTION BY THE CITY OF THE "AIR NORTH TEXAS PARTNER
AGREEMENT" OF THE NORTH CENTRAL TEXAS COUNCIL OF GOVERNMENTS AND
THE REGIONAL TRANSPORTATION COUNCIL, WHEREIN THE CITY OF DENTON
SUPPORTS THE PRINCIPLES, GOALS, ACTIVITIES AND RECOMMENDATIONS OF
THE PARTNERSHIP; AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, the Regional Transporting Council, comprised primarily of local
government elected officials, the regional transportation body that is associated with the North
Central Texas Council of Governments (NCTCOG) has been and continues to be a forum for
cooperative decisions on transportation; and
WHEREAS, the City of Denton, Texas is a Texas Home-Rule City and a Municipal
Corporation that supports the Regional Transportation Council and the goals and mission
statements of the "Air North Texas" campaign; and
WHEREAS, the Dallas-Fort Worth area is a federally designated nonattainment area for
the pollutant ozone and air quality impacts the public and economic health of the entire region;
and
WHEREAS, the primary goal of air quality management is the protection of public health
and welfare, reducing and improving the health impacts caused predominately by mobile-source
emissions with the assistance of partnering entities while preserving the economic vitality of the
region; and
WHEREAS, the North Central Texas Council of Governments has formed alliances with
public and private entities in the region to assist and support in the development of the Air North
Texas campaign elements, and the dissemination of information; and
WHEREAS, the "Air North Texas" campaign is a collaborative intuitive involving
partners from public, private and non-profit entities that will promote a consistent regional
message; and
WHEREAS, the "Air North Texas" campaign is committed to increasing air quality
awareness to citizens and residents in the North Texas region; and
WHEREAS, the City of Denton recognizes that this Agreement is anon-binding mutual
expression of cooperation to support the principles stated in the "Air North Texas Partner
Agreement;" and this Agreement is not intended to confer or create a financial obligation, or
expectation of payment to or from an Air North Texas Partner, or the North Central Council of
Governments, or the Regional Transportation Council
WHEREAS, the City of Denton, Texas pledges to acknowledge and support the
principles, goals, activities and recommendations of "Air North Texas," and hereby adopts and
executes the "Air North Texas Partner Agreement."
WHEREAS, the City of Denton City Council Committee on the Environment, at its
regularly called meeting of April 7, 2008 has recommended approval of this Agreement; and
WHEREAS, the City Council of the City of Denton, Texas is of the opinion, in the
interest of its citizens, that it should enter into the above-referenced Agreement; NOW,
THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY RESOLVES:
SECTION 1. The City Council of the City of Denton, Texas hereby authorizes its
Mayor, or his designee, to enter into the attached "Air North Texas Partner Agreement"; and
supports the principles, goals, activities and recommendations contained in said Agreement.
SECTION 2. This Resolution shall become effective immediately upon its passage and
approval.
PASSED AND APPROVED this the day of , 2008.
PERRY R. McNEILL, MAYOR
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
By:
APPROVED AS TO LEGAL FORM:
EDWIN M. SNYDER, CITY ATTORNEY
By:
Page 2 of 2
v
EXHIBIT 3
1 DRAFT MINUTES
2 CITY COUNCIL COMMITTEE ON THE ENVIRONMENT
3 April 7, 2008
4
5 After determining that a quorum of the Committee on the Environment of the Denton City
6 Council was present, the Chair of the Committee on the Environment convened into a meeting
7 on Monday, April 7, 2008 at 11:3 8 a.m. in the Council Work Session Room, 215 East McKinney
8 Street, Denton, Texas to consider the specific agenda items listed below
9
10 Present: Chair Joe Mulroy, Mayor Pro Tem Pete Kamp and Council Member Jack
11 Thomson
12
13 Also Present: Howard Martin, ACM
14 Fred Greene, ACM
15 Jim Coulter, Director of Water Wastewater Utilities
16 Dr. Kenneth Banks, Manager Division of Environmental Quality
17 Katherine Barnett, Utilities Special Projects Coordinator
18 Mark Cunningham, Director Planning and Development
19 Emerson Vorel, Director Parks and Recreation
20 Ron Menguita, Planner Supervisor
21 Kurt Hansen, Building Official
22 Ann Forsythe, Boards and Committees Coordinator
23
24 OPEN MEETING:
25
26 4) Receive a report, hold discussion and give staff direction regarding Air North Texas
27 Partnership Agreement.
28
29 Howard Martin, ACM, stated that Katherine Barnett, Special Projects Coordinator, has provided
30 minimum expectations that Denton will commit to. She has also provided an outline of the new
31 agreement as well as a draft resolution. Martin then called on Barnett to present. Barnett stated
32 that the partnership agreement is ready, and that this is a great campaign in that this is really the
33 first campaign that sends a comprehensive, consistent message throughout the region of a year
34 round air quality campaign.
35
36 Council Member Thomson asked about the cost. Barnett replied there was monetary impact to
37 join the campaign. The City will incorporate COG's advertising materials whenever possible.
38
39 Mulroy asked about the time frame to respond. Barnett replied by the end of this month.
40
41 Mayor Pro Tem stated she believed there would be a presentation to the RTC on Thursday and
42 she would certainly like to be able to say that it is going to the City Council.
43
44 Staff was directed to place this item on the April 15th City Council agenda as an item for
45 individual consideration and to include minutes in the backup.
46
47 The meeting was adj ourned by consensus at 12:5 8 p.m.
48
AGENDA INFORMATION SHEET
AGENDA DATE: April 15, 2008
DEPARTMENT: City Manager's Office
CM: George Campbell, City Manager
SUBJECT
Consider nominations/appointments to the City's Boards and Commissions.
BACKGROUND
The following boards/commissions require nominations:
Historic Landmark Commission -This is Darlene Mullenweg's position. This is a nomination for
Mayor McNeill.
If you require any further information, please let me know.
Respectfully submitted:
Jennifer Walters
City Secretary
S:1Boards & CommlA~enda Info Sheet for Vacancies 04.01.08.docx
v
(4/15/208) Uncla Holley - Agenda item 3.I. Page 1
Handout to City Council 04/15/08
Item 31
From: Linda Holley
To: Joe Mulroy
CC: Bob Montgomery; Charlye Heggins; Chris Watts; George Campbell; Jack
Date: 4/15/2008 12:16 PM
Subject: Agenda Item 31.
Attachments: memo.pdf
Joe,
Attached is a memo in response to your question of Item 3.1. of the council agenda tonight. If you have any further
questions, please call George.
Linda Holley
Executive Assistant
City Managers Office
City of Denton
940-349-7715
940-349-8596 - Fax
City
of
'EN1,r0N'
MATERIALS MANAGEMENT DIVISION
901 B TEXAS STREET DENTON, TEXAS 76209 940.349.7100 www.dentonpurchasing.com FAX 940.349.7302
MEMORANDUM
TO: George Campbell, City Manager
FROM: Tom Shaw, Purchasing Agent--%
DATE: May 6, 2008
SUBJECT: April 15, 2008 Council Agenda Item 31 Purchase of Electric Distribution
Cable Through LCRA
Purchase orders are routinely canceled for various reasons including: changes in
quantity/pricing, schedule versus delivery issues, revisions to specifications, suppliers
going out of business, non-compliance with terms and conditions, and other
miscellaneous business decisions. In the case of Agenda Item 3I, the order was issued
based upon a bid that was opened in January and awarded in March. During the time
span between bid opening and award, the copper market experienced a double digit
increase. The vendor could no longer deliver the product at the quoted price. Rather than
going through the delay of rebidding the product, we chose to cancel the purchase order
and go to a second .source of supply using the LCRA Interlocal Agreement which
mirrored the current market cost. The Purchasing Office and Denton Municipal Electric
(DME) agreed the need for this particular product was critical to the continued expansion
of DME's operation and therefore the purchase through LCRA was the best business
decision.
The other alternative, besides rebidding or using the LCRA contract, was to leave the
purchase order in place and pursue legal action to enforce the bid terms. This would have
evolved into a lengthy delay and the loss of one of our most competitive suppliers. The
action recommended for this item is intended to nullify the original ordinance and
authorize the issuing of a new purchase order at the current price with a firm delivery
schedule.
cc: Jon Fortune, Assistant City Manager
Bryan Langley, Director of Finance
"Dedicated to Quality Service"
www. ci t itotd en ton. con 1
I DRAFT MINUTES
2 PUBLIC UTILITIES BOARD
3 April 14, 2008
4
5 After determining that a quorum of the Public Utilities Board of the City of Denton, Texas was
6 present, and after convening an Open Meeting, the Vice Chair of the Public Utilities Board
7 thereafter convened into an Open Meeting on Monday, April 14, 2008 at 9:03 a.m. in the Service
8 Center Training Room, City of Denton Service Center, 901-A Texas Street, Denton, Texas.
9
10 Present: Vice Chair Dick Smith, Phil Gallivan, Randy Robinson and Bill Grubbs
11
12 Ex Officio Members:
13 George C. Campbell, City Manager
14 Howard Martin, ACM Utilities
15
16 Absent: Chair Charldean Newell, Bill Cheek and John Baines, excused
17
18 OPEN MEETING:
19
20 CONSENT AGENDA:
21 The Public Utilities Board has received background information, staff's recommendations, and
22 has had an opportunity to raise questions regarding these items prior to consideration.
23
24 1) Consider recommending adoption of an ordinance amending Ordinance No. 2008-057 that
25 awards a purchase for primary and secondary insulated electric distribution cables for the
26 City of Denton, Texas (Denton Municipal Electric). (File No. 3623-Interlocal Agreement for
27 Purchase of Primary and Secondary Insulated Electric Distribution Cables with the Lower
28 Colorado River Authority; awarded to Techline, Ltd., in the estimated amount of
29 $2,205,840).
30
31 Board Member Phil Gallivan moved to approve Item 1 with a second from Board member
32 Bill Grubbs. The motion was approved by a 4-0 vote.
33
34 The meeting was adjourned by consensus at 10:15 a.m.
35
Presentation to Denton City Council
Tuesday, April 15`h, 2008
SUBJECT: Lee Meadows Subdivision/2"d Request for Flood Control
Mayor McNeill, City Councilmen, City Councilwomen, _
_ ®r pry Pots 1~.1nY
(Show city map with subdivision highlighted)
I am representing the home owners of the °,ee Meadows Subdivision. Following the
Denton flood of April 24`h, 2007, our neighborhood came before the City Council on
June 5`h, seeking water control solutions from the City of Denton. Lee Meadows is
located between Paisley Street, Audra Lane and Mack Drive of Denton, Texas.
(Show plat map with flooded homes highlighter)
On the evening of April 24`n, zoos approximately 11 homes were flooded as shown here.
This was not the first time many of these properties had flooded. Some have flooded as
much as 5 to 6 times.
Following our meeting before the Denton City Council, Mr. Jim Coulter contacted me
and set up a neighborhood meeting on Wednesday; September 19`h' 2007. Mr. Coulter
presented a series of maps and indicated areas that would be worked on to direct the
water flow away from our neighborhood. He also advised the residents that a city
engineer would examine our prosperities, and to not make any improvements until then.
We waited. Eight months later; Mr. Chad Allen, Senior Engineer; City of Denton; met
with me on April 3, 2008. We walked 3 of the 1 l properties that had flooded. We were
joined by property owner, Ms. Nancy Christy. Mr. Allen concluded that the homes built
on the adjoining properties on Oak Tree Street had been excavated in such a manner that
forced all the water run-off through our properties. He told us he would send a
recommendation to correct the problems to Mr. Coulter, and copy me on the report.
I have not received a copy of the report and Mr. Allen has not returned my phone calls.
I reported on June 5th, 2007: The homes in Lee Meadows were flood free until the houses
on Oak Tree Street, which are located directly north the homes on Mack Place, were
built. Following the grading, removal of trees, terracing of properties, and removal of a
creek northeast of our properties, our homes have flooded numerous times. When our
homes were built, the drainage ran off into `he existing creek, and into a pond on Audra
Lane, that is the current site of the Ann Wi!;dle School.
We sincerely believe that the construction on Oak Tree Street and removal of the creek
has led to these flooding problems AFTER our homes were built and occupied.
V
This was verified by Mr. Chad Allen on Thursday, April n M. , 2008 after he had examined
the area. Mr. Allen also informed me that the City of Denton had a list of flood control
projects and Lee meadows was not on the list.
To correct a past mistake, Lee Meadows should have been on the top of your list of flood
control improvements; however, it seems our prior requests have been ignored.
So we are back. We are here tonight to make the following requests of the City of Denton:
1. Put Lee Meadows at the top of your list of flood control projects.
2. Take corrective measures to prevent future flooding of our homes.
3. Correct the injustice that was done to our neighborhood by the City of
Denton approving the construction plans for Oak Tree Street.
In summary:
We are asking that the City of Denton be responsible to its citizens, and take immediate
action to protect our properties from future flooding by correcting the mistakes of the
past.
I issue this request on behalf of the residents of Lee Meadows, Denton, Texas.
Pat Foutch
Representative of Lee Meadows Subdivision
Denton, Texas
Owner: 2017 Mack Place, Denton, Texas
Telephone: 940-535-2344
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