2018-079 2nd Quarter Financial ReportDate: June 29, 2018 Report No. 2018-079
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT:
Quarterly Financial Report for the period ending March 31, 2018.
BACKGROUND:
Attached for your review is the Quarterly Financial Report for the period ending March 31,
2018. If you have any questions or need additional information, please let me know.
STAFF CONTACT:
Antonio Puente, Jr., Director of Finance
(940) 349-7283
Antonio.Puente@cityofdenton.com
1
About This Quarterly Financial
Report
This report has been prepared by the City of Denton’s Finance
Department. The Quarterly Financial Report is intended to provide
our users (internal and external) with information regarding the City’s
financial position and economic activity. This report includes
information for the quarter ending March 31, 2018.
This report is presented in six sections.
1. The Executive Dashboard section contains a high level
summary of the major operating funds using graphic
illustrations and key economic indicators. Narrative disclosures
are also included to highlight any significant changes or
fluctuations.
2. The Financial Summary section reports the performance of the
major operating funds of the City. In addition, the report
provides an end of year projection and a comparison to the
budget for major revenue sources and expenditure items.
3. The Revenue & Economic Analysis section provides additional
analysis regarding key revenue sources and economic
indicators.
4. The Quarterly Investment Report provides a summary of the
City’s investment portfolio, interest earnings and a brief market
outlook.
5. The Performance Report provides Key Performance Indicators
(KPIs) for each of the goals identified in the City’s strategic
plan. In addition, the progress on Key Action Steps are
highlighted.
The Quarterly Financial Report is intended to provide our users with
timely and relevant information. Please provide us with any
comments or suggestions you may have. If you would like additional
information, feel free to contact me.
Antonio Puente, Jr
Director of Finance
215 East McKinney Street
Denton, TX 76201
940-349-8260
Section 1
City of Denton
Quarterly Financial Report
March 2018
Executive Dashboards
4
Note: All figures presented are in millions of dollars.FY 2017-18 FY 2017-18ANNUAL ANNUAL FY 2017-18DESCRIPTION BUDGET 1PROJECTION VARIANCEBeginning Fund Balance as of 09/30/17 28.17$ 31.77$ RESOURCES: Ad Valorem Taxes 45.07 44.81 -1% Sales Tax36.18 39.20 8% Franchise Fees4.98 4.98 0% Other Taxes0.49 0.49 0% Service Fees8.34 7.95 -5% Fines and Fees3.96 3.71 -6% Licenses and Permits2.73 3.75 37% Miscellaneous Revenue1.92 2.04 6% Transfers In16.05 16.04 0%Total Revenues119.72 122.97 3%Total Resources147.89 154.74 EXPENDITURES : Personal Service84.51 84.04 -1% Material and Supplies3.07 3.07 0% Maintenance and Repairs2.94 2.94 0% Insurance1.21 1.21 0% Miscellaneous1.19 1.19 0% Operations15.87 14.93 -6% Transfers Out13.00 13.00 0% Fixed Assets0.59 0.59 0%Total Expenditures122.38 120.97 -1%Net Income (Loss)(2.66) 2.00 Ending Fund Balance25.51$ 33.77$ City of Denton, Texas General Fund Executive Dashboard $‐ $10 $20 $30 $40 $50 $60 $70 $80 $90Revenue & Expenses (in Millions)YTD RevenueYTD ExpensesKey TrendsSales Tax revenues are projected $3.02M higher than budget due to stronger collections in retail activities. Licenses and Permits revenues are projected $1.02M higher than budget due to Building Permits.Personal Service expenditures are projected $0.47M less than budget due to position savings.Operations expenditures are projected $0.94M less than budget mainly due to Chapter 380 agreements. Budget amended on January 9, 2018 for $2.695M to fund one‐time capital projects as a result of better than anticipated results for FY 2016‐17.Does not include budget amendment approved May 8, 2018 for $2.19M to fund the Vela Soccer Complex project. $‐ $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5Sales Tax Monthly Average by Quarter1Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which wasestimated in the FY 2017‐18 budget process.5
Note: All figures presented are in millions of dollars.City of Denton, Texas Electric Fund Executive DashboardDESCRIPTIONFY 2017-18 ANNUAL BUDGET 1FY 2017-18 ANNUAL PROJECTIONS FY 2017-18 VARIANCEBeginning Working Capital and Reserves as of 9/30/17 72.51$ 76.94$ RESOURCES: Operating Revenues 173.23 182.60 5% Non-operating Revenues0.45 0.57 26%Total Revenues173.68 183.17 5%Total Resources246.19 260.11 EXPENDITURES: Purchased Power84.55 82.14 -3% Operation and Maintenance47.24 66.32 40% Non-Operating Expenditures49.11 48.48 -1%Total Expenditures180.90 196.94 9%Net Income (Loss)(7.22) (13.77) En di n g W ork i n g C api tal and Reserves65.29$ 63.17$ $0$10$20$30$40$50$60$70$80$90$100Oct‐17 Nov‐17 Dec‐17 Jan‐18 Feb ‐ 18 Mar‐18Revenue & Expenses (in Millions)YTD RevenueYTD ExpenseKey TrendsOperating Revenues are projected to be 5% higher than budgeted due to TCOS Revenue which is expected to be $14.7 million more as a result of the latest DME Transmission filing.Operations and Maintenance expenditures are estimated to be 40% or $19.0 Million higher than budgeted due to a $24 million budget amendment to cash fund capital expenditures in FY 2017‐18. As of 9/30/17, working capital was $14.91 million, and the rate stabilization reserve was $62.03 million. Additionally, Electric had an over collected Energy Cost Adjustment (ECA) of $7.4 million.0501001502002503003504004505001Q 13 3Q 13 1Q 14 3Q 14 1Q 15 3Q 15 1Q16 3Q16 1Q17 3Q17 1Q182013 – 2018 Historical Quarterly GWH Sales1Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which was estimated in the FY 2017‐18 budget process.6
Note: All figures presented are in millions of dollars.FY 2017-18 FY 2017-18ANNUAL ANNUAL FY 2017-18DESCRIPTIONBUDGET 1PROJECTION VARIANCEBeginning Working Capital and Reserves as of 09/30/17220.85$ 23.34$ RESOURCES: Water Sales 37.12 36.88 -1% Other Water Revenues 0.98 0.97 -1% Transfers In 5.95 5.81 -2% Impact Fee Revenue 3.76 3.76 0%Total Revenues 47.81 47.42 -1%Total Resources 68.66 70.76 EXPENDITURES: Personal Service 11.41 10.96 -4% Operations, Services 11.18 10.77 -4% Capital Outlay 9.11 9.17 1% Debt Service 12.64 12.64 0% Transfers Out 3.47 3.49 1%Total Expenditures 47.81 47.03 -2%Net Income (Loss) - 0.39 Ending Working Capital and Reserves 20.85$ 23.73$ 05001,0001,5002,0002,5001Q133Q131Q143Q141Q153Q151Q163Q161Q173Q171Q182013‐2018 Historical Quarterly Gallons Sold (in Millions)City of Denton, Texas Water Fund Executive Dashboard $‐ $5 $10 $15 $20 $25 $30Oct‐17 Nov‐17 Dec‐17 Jan‐18 Feb‐18 Mar‐18Revenue & Expenses (in Millions)YTD RevenueYTD ExpensesKey TrendsPersonal Service expenses are projected to be below budget due to position vacancies.Operations, Services are projected to be below budget due to reduced materials & supplies and outside services expenses.1Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which was estimated in the FY 2017‐18 budget process.2The Beginning Working Capital balance excludes $6.7M of Impact Fee Reserves and $0.25 million for Development Plan Line Reserves.7
FY 2017-18 FY 2017-18ANNUAL ANNUAL FY 2017-18DESCRIPTIONBUDGET 1PROJECTION VARIANCEBeginning Working Capital and Reserves as of 09/30/17215.93$ 17.86$ RESOURCES: Wastewater Fees24.14 24.23 0% Other Wastewater Revenue1.76 1.78 1% Drainage Fees4.67 4.65 0% Transfer In0.66 0.66 0% Impact Fee Revenue2.00 2.00 0%Total Revenues33.23 33.32 0%Total Resources49.16 51.18 EXPENDITURES: Personal Service8.10 7.62 -6% Operations, Services8.59 8.24 -4% Capital Outlay6.87 7.10 3% Debt Service7.17 7.17 0% Transfer Out3.29 3.30 0%Total Expenditures34.02 33.43 -2%Net Income (Loss)(0.79) (0.11) Ending Working Capital and Reserves 15.14$ 17.75$ Note: All figures presented are in millions of dollars.02004006008001,0001,2001,4001Q133Q131Q143Q141Q153Q151Q163Q161Q173Q171Q182013‐2018 Historical Quarterly Gallons Billed (in Millions)City of Denton, Texas Wastewater Fund Executive Dashboard $‐ $2 $4 $6 $8 $10 $12 $14 $16 $18 $20Oct‐17 Nov‐17 Dec‐17 Jan‐18 Feb‐18 Mar‐18Revenue & Expenses (in Millions)YTD RevenueYTD ExpensesKey TrendsPersonal Service expenses are projected to be below budget due to position vacancies.Operations, Services are projected to be below budget due to reduced materials & supplies, outside services, and purchased power expenses.1Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which was estimated in the FY 2017‐18 budget process.2The Beginning Working Capital balance excludes $2.2 million of Impact Fee Reserves, $1.0 million for Drainage Reserves, and $0.33 million for Development Plan Line Reserves.8
FY 2017-18 FY 2017-18ANNUAL ANNUAL FY 2017-18DESCRIPTION BUDGET PROJECTION VARIANCEREVENUES: Residential Drainage Fees 1.78$ 1.79$ 1% Nonresidential Drainage Fees 2.90 2.86 -1% Wastewater Resources 0.04 0.10 150% General Fund Transfer 0.42 0.42 0%Total Revenues 5.14 5.17 1%EXPENDITURES: Personal Service 1.78 1.54 -13% Operations, Services 0.80 0.77 -4% Capital Outlay 1.28 1.56 22% Debt Service 0.68 0.68 0% Transfer Out 0.60 0.62 3%Total Expenditures 5.14 5.17 1%Net Income (Loss) -$ -$ Note: All figures presented are in millions of dollars.City of Denton, Texas Drainage Operations Executive Dashboard $‐ $0.5 $1.0 $1.5 $2.0 $2.5 $3.0Oct‐17 Nov‐17 Dec‐17 Jan‐18 Feb‐18 Mar‐18Revenue & Expenses (in Millions)YTD RevenueYTD ExpensesKey TrendsPersonal Services are projected to be lower than budget due to position vacancies.Capital Outlay is projected to be higher than budget due to an increase in projects activity.9
FY 2017-18 FY 2017-18ANNUAL ANNUAL FY 2017-18DESCRIPTIONBUDGET 1PROJECTION VARIANCEBeginning Working Capital and Reserves as of 09/30/1728.15$ 9.47$ RESOURCES: Collection & Disposal 35.86 32.16 -10% Recycling0.87 0.78 -10% Other Revenue1.29 0.70 -46%Total Revenues38.02 33.64 -12%Total Resources46.17 43.11 EXPENDITURES: Personal Service11.68 10.94 -6% Operations, Services11.51 10.42 -9% Capital Outlay2.67 0.35 -87% Debt Service9.70 9.54 -2% Transfer Out2.97 2.97 0%Total Expenditures38.53 34.22 -11%Net Income (Loss)(0.51) (0.58) Ending Working Capital and Reserves7.64$ 8.89$ 01,0002,0003,0004,0005,0006,0007,0002016Qtr 32016Qtr 42017Qtr 12017Qtr 22017Qtr 32017Qtr 42018Qtr 12018Qtr 2Refuse TonnageRecycling TonnagesResidential Curbside Collection TonnageNote: All figures presented are in millions of dollars.City of Denton, Texas Solid Waste Fund Executive DashboardKey TrendsCollection and Disposal revenue, as well as Personnel and Operations Services expense will be less than budget due to discontinued mining operations.Landfill Closure costs will be greater than budget due to a recent study which projected increased future expense. Capital Outlay is expected to be less than budget due to reduced transfers to Capital projects.Transfers out are expected to increase due to land transfers to DME.05,00010,00015,00020,00025,00030,0002016Qtr 32016Qtr 42017Qtr 12017Qtr 22017Qtr 32017Qtr 42018Qtr 12018Qtr 2Commercial Refuse & Recycling (Front & Side Load)Cubic Yards Serviced per WeekCommercial RefuseCommercial Recycling1Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which was estimated in the FY 2017‐18 budget process.2The Beginning Working Capital and Reserves excludes $8.65 million of Landfill Closure/Post Closure reserves.10
City of Denton, Texas Airport Fund Executive DashboardKey TrendsFBO Commissions include a one‐time collection of $55,000 not originally included in budget.Personnel Service Expense is projected to be less than budget due to vacant positions.Gas Well Royalty revenue is expected to exceed budget due to recently reworked gas wells.$0.0$1.0$2.0$3.0$4.0$5.02008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018GAS WELLREVENUE(in millions of dollars by fiscal year) 20,000 30,000 40,000 50,000 60,000AIRPORT OPERATIONS BY QUARTER(takeoff or landing)Note: All financial amounts presented are in millions of dollars.FY 2017-18 FY 2017-18ANNUAL ANNUAL FY 2017-18DESCRIPTION BUDGET 1PROJECTION VARIANCEBeginning Working Capital and Reserves as of 09/30/17 2.47$ 2.75$ RESOURCES: Airport Ground Leases 0.71 0.68 -4% FBO Commissions 0.20 0.26 30% Miscellaneous 0.09 0.10 11%Total Operating Revenues 1.00 1.04 4%EXPENDITURES: Personal Service 0.53 0.45 -15% Operations, Services 0.41 0.40 -2% Transfer Out 0.55 0.55 0%Total Operating Expenditures 1.49 1.40 -6%Net Operating Income (Loss) (0.49) (0.36) NON-OPERATING REVENUES: Investment Income 0.03 0.06 100% Gas Well Royalties 0.47 0.44 -6%Total Non-Operating Revenues 0.50 0.50 0%NON-OPERATING EXPENDITURES: Transfer Out - Capital 0.22 0.22 0%Total Non-Operating Expenditures 0.22 0.22 0%Net Non-Operating Income (Loss) 0.28 0.28 Net Income (Loss) (0.21) (0.08) Ending Working Capital and Reserves 2.26$ 2.67$ 1Annual adopted budget as amended or modified. Beginning Working Capital and Reserves represents the amount which was estimated in the FY 2017‐18 budget process.11
FY 2017-18 FY 2017-18ANNUAL ANNUAL FY 2017-18DESCRIPTIONBUDGET 1PROJECTION VARIANCEBeginning Working Capital and Reserves as of 09/30/2017 1.25$ 1.16$ RESOURCES: Franchise Fees12.47 12.47 0% Street Cuts0.36 0.36 0% Investment Income0.01 0.01 0% Transfers In1.12 1.12 0%Total Revenues13.96 13.96 0%Total Resources15.21 15.12 EXPENDITURES: Personal Service3.44 3.44 0% Materials & Supplies0.09 0.09 0% Maintenance & Repairs7.79 7.79 0% Operations, Services0.89 0.89 0% Transfer Out1.75 1.75 0%Total Expe n di tu re s13.96 13.96 0%Net Income (Loss)- - Ending Fund Balance1.25$ 1.16$ 1Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which was estimated in the FY 2017-18 budget process.City of Denton, Texas Street Improvement Fund Executive DashboardKey TrendsAt this point in the fiscal year, revenues and expenditures are projected to meet budgeted levels.Surface treatments for the year are scheduled to begin in the 3rdquarter.Note: All figures presented are in millions of dollars.036912Qtr1 Qtr2Tons of Asphalt Laid (in Thousands)FY16-17FY17-1806121824Qtr 1 Qtr 2Lane Miles Surface TreatmentFY 16-17FY 17-18 $- $2.0 $4.0 $6.0 $8.0Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18Revenue & Expenses (in Millions)YTD RevenueYTD Expenses12
FY 2017-18 FY 2017-18GRANT ANNUAL FY 2017-18DESCRIPTION AMOUNT PROJECTION VARIANCE2017-18 Budget Comm Development12.94$ 1.05$ -64% Public Safety 0.80 0.80 0% Transportation195.14 26.98 -72% Other 0.03 0.03 0%Total Budge t 98.91 28.86 -71%New Awards Comm Development 0.60 0.50 -17% Public Safety 0.24 0.24 0% Transportation13.39 1.48 -56% Parks & Recreation 0.21 0.21 0%Total New Awards 4.44 2.43 -45%Totals 103.35$ 31.29$ -70%COMM DEV3.43%PUBLIC SAFETY1.00%TRANS95.34%PARKS & REC0.21%OTHER0.03%FY 2017‐18 Grants Awarded $‐ $20.0 $40.0 $60.0 $80.0 $100.0 $120.0COMMDEVPUBLICSAFETYTRANSPARKS &RECOTHERAwardsExpensesFY 2017‐18 Awards & Expenses (in Millions)Key TrendsThe following grants have been received in FY 2017-18: Federal Equitable Sharing: $13,067Chapter 59 Asset Forfeitures: $18,560U.S. Marshals Violent Offenders Task Force: $10,136PD-Law Enforcement Officer Standard & Education:$11,618Sexual Assault Examiners Reimbursement:$22,1392017 SHSP Ballistic Blankets: $3,0002017 SHSP Night Vision: $14,2002017 UASI Command Data: $30,000Body Armor Grant Program: $91,6922018 SHSP SWAT Equipment Enhancement: $24,000Transportation Projects: $3,387,898NW Trail Extension Grant: $212,273City of Denton, Texas Grants DashboardNote: All figures presented are in millions of dollars.1This grant amount will be spent over several years and the fiscal year 2017-18 projections are estimated expenditures for one year. Remaining grant amounts will be spent in future fiscal year.13
Section 2
City of Denton
Quarterly Financial Report
March 2018
This report is designed for internal use and does not include all the
funds and accounts included in the City of Denton’s operations. The
information provided is unaudited; for a complete audited report,
please refer to the City of Denton Comprehensive Annual Financial
Report, available through the City’s Finance Department, City
Secretary’s Office, or Denton Public Libraries.
FINANCIAL SUMMARY
14
City of Denton General FundSchedule of Revenues - Budget vs Projection (Unaudited)For the Period Ended March 31, 2018
PRIOR BUDGET CURRENT ANNUAL ANNUAL BUDGET VS
REVENUE DESCRIPTION Y-T-D Y-T-D Y-T-D BUDGET PROJECTION PROJECTION
Current Year - Ad Valorem 42,702,467$ 43,306,066$ 43,883,129$ 44,460,191$ 44,460,191$ 0%
Delinquent - Ad Valorem 158,806 144,495 47,605 288,991 42,960 -85%
Miscellaneous Penalties & Fees 207,609 176,806 186,370 315,384 305,866 -3%
Ad Valorem Taxes 43,068,882 43,627,367 44,117,104 45,064,566 44,809,017 -1%
Sales Tax 17,884,054 18,097,927 18,918,854 36,181,384 39,202,935 8%
Franchise - Gas Utilities 85,724 101,093 102,198 342,738 342,738 0%
Franchise - Private Electric Utilities 30,713 15,517 26,734 122,751 122,751 0%
Franchise - Cable 126,858 118,930 104,825 480,873 480,873 0%
Franchise - Telecom 133,940 57,863 77,690 233,956 233,956 0%
Franchise - Denton Municipal Utilities 1,833,939 1,683,651 1,695,185 3,804,531 3,804,531 0%
Franchise Fees 2,211,174 1,977,054 2,006,632 4,984,849 4,984,849 0%
Other Taxes 157,410 122,850 3,192 491,400 491,400 0%
Ambulance Service Fees 1,451,644 1,322,151 1,255,064 3,726,629 3,380,800 -9%
Fire Department Fees 66,982 97,513 109,471 195,027 196,000 0%
Building Inspections Fees 227,348 258,199 302,028 560,145 528,067 -6%
Park Department Fees 319,508 405,225 322,876 2,406,263 2,295,651 -5%
Planning Department Fees 378,450 443,251 474,833 886,355 991,887 12%
Reprographics Fees 176,691 185,153 168,386 370,160 370,160 0%
Miscellaneous Service Fees 47,296 99,035 67,584 198,043 183,015 -8%
Service Fees 2,667,919 2,810,527 2,700,242 8,342,622 7,945,580 -5%
Denton Municipal Fines 794,879 824,520 709,033 1,649,042 1,482,000 -10%
Parking Fines 146,455 123,600 118,850 247,200 260,000 5%
Miscellaneous Fines and Fees 461,934 513,973 424,687 1,077,838 889,000 -18%
Court Administrative and Service Fees 462,719 461,500 511,633 988,000 1,080,000 9%
Fines and Fees 1,865,987 1,923,593 1,764,203 3,962,080 3,711,000 -6%
Demolition Permits 3,990 5,041 2,850 10,082 7,670 -24%
Building Permits 1,034,677 1,160,578 1,739,727 2,571,085 3,637,834 41%
Certificate of Occupancy 40,185 47,244 34,810 94,488 72,829 -23%
Miscellaneous Licenses and Permits 16,695 27,915 4,077 55,822 32,278 -42%
Licenses and Permits 1,095,547 1,240,778 1,781,464 2,731,477 3,750,611 37%
Investment Income 177,039 265,000 271,984 530,000 460,600 -13%
Miscellaneous Revenues 314,453 466,815 314,706 1,383,388 1,576,147 14%
Miscellaneous Resources 491,492 731,815 586,690 1,913,388 2,036,747 6%
ROI - Denton Municipal Utilities 3,370,592 3,778,153 3,566,620 7,997,918 7,987,758 0%
Transfers 4,034,480 4,025,789 4,018,449 8,050,688 8,050,688 0%
Transfers 7,405,072 7,803,942 7,585,069 16,048,606 16,038,446 0%
Total General Fund Revenues 76,847,537$ 78,335,853$ 79,463,450$ 119,720,372$ 122,970,585$ 3%
15
City of Denton
General Fund
Schedule of Expenditures - Budget vs Projection (Unaudited)
For the Period Ended March 31, 2018
PRIOR BUDGET CURRENT ANNUAL ANNUAL BUDGET VS
Y-T-D Y-T-D Y-T-D BUDGET PROJECTION PROJECTION
NEIGHBORHOOD SERVICES
Building Inspections 1,376,128$ 1,538,559$ 1,309,243$ 3,071,315$ 3,071,315$ 0%
Community Improvement Services 784,609 782,463 628,680 1,564,294 1,564,294 0%
Libraries 2,884,505 3,033,267 2,877,388 6,064,112 6,064,112 0%
Parks and Recreation 5,424,492 7,275,990 5,889,161 13,971,655 13,971,655 0%
Planning 1,455,488 1,706,148 1,300,199 3,415,509 3,415,509 0%
Gas Well Review 95,515 196,593 207,828 393,026 393,026 0%
Social Services 276,566 314,995 291,238 629,738 629,738 0%
12,297,303 14,848,015 12,503,737 29,109,649 29,109,649 0%
PUBLIC SAFETY
Animal Services 606,320 779,907 740,526 1,559,205 1,559,205 0%
Fire 13,001,403 14,361,528 13,964,776 28,711,580 28,876,353 1%
Municipal Court 644,106 691,128 611,621 1,381,702 1,381,702 0%
Municipal Judge 183,318 218,145 192,409 436,124 436,124 0%
Police 14,147,097 16,155,348 14,933,047 32,297,806 32,297,806 0%
28,582,244 32,206,056 30,442,379 64,386,417 64,551,190 0%
TRANSPORTATION
Traffic Operations 812,302 3,056,385 2,891,446 3,992,028 3,992,028 0%
Transportation Operations 226,822 423,495 409,302 846,658 846,658 0%
Street Lighting 390,199 377,651 384,763 755,000 755,000 0%
1,429,323 3,857,531 3,685,511 5,593,686 5,593,686 0%
ADMINISTRATIVE & COMMUNITY SERVICES
Cable Television 142,810 161,691 149,064 323,271 323,271 0%
City Manager's Office 1,276,685 1,415,207 1,490,688 2,829,303 2,829,303 0%
Economic Development 1,253,704 2,229,929 1,200,879 4,458,071 3,353,387 -25%
Facilities Management 1,797,291 2,163,181 1,919,078 4,324,642 4,324,642 0%
Finance 1,376,725 1,538,716 1,431,745 3,074,420 3,074,420 0%
Human Resources 804,766 878,285 823,401 1,755,865 1,755,865 0%
Internal Audit 31,226 131,744 204,754 263,381 263,381 0%
Legal Administration 1,053,692 1,227,383 959,718 2,453,772 2,453,772 0%
Public Communications Office 208,501 247,605 198,211 495,021 495,021 0%
Reprographics 203,476 216,908 198,890 433,646 433,646 0%
Non-Departmental 2,030,391 1,440,599 2,296,092 2,881,847 2,407,704 -16%
10,179,267 11,651,248 10,872,520 23,293,239 21,714,412 -7%
TOTAL EXPENDITURES 52,488,137$ 62,562,850$ 57,504,147$ 122,382,991$ 120,968,937$ -1%
16
City of Denton
Electric Fund
Schedule of Revenues and Expenditures - Budget vs Projections (Unaudited)
For the Period Ended March 31, 2018
PRIOR BUDGET CURRENT ANNUAL ANNUAL BUDGET VS
DESCRIPTION Y-T-D Y-T-D Y-T-D BUDGET1 PROJECTION PROJECTION
Beginning Working Capital
and Reserves as of 9/30/17 72,510,304$ 76,942,756$
REVENUES:
Operating Revenues 76,139,210$ 77,336,545$ 81,400,580$ 173,229,784 182,602,516 5%
Non-operating Revenues 311,910 189,147 501,035 450,000 565,000 26%
Total Revenues 76,451,120 77,525,692 81,901,615 173,679,784 183,167,516 5%
EXPENDITURES:
Purchased Power 43,143,626 43,115,114 40,015,513 84,547,684 82,140,290 -3%
Operation and Maintenance 16,841,783 23,461,141 17,137,370 47,238,356 66,319,292 40%
Return on Investment Return on Investment2,391,566 2,602,627 2,554,860 5,767,985 5,767,985 0%
Franchise Fee Franchise Fee3,410,896 3,713,843 3,645,018 8,239,978 8,239,978 0%
Non-Operating Expenditures 23,036,843 27,873,738 27,531,534 35,109,750 34,465,369 -2%
Total Expenditures 88,824,714 100,766,463 90,884,295 180,903,753 196,932,914 9%
Net Income (Loss)(12,373,594)$ (23,240,771)$ (8,982,680)$ (7,223,969) (13,765,398)
Ending Working Capital and Reserves 65,286,335$ 63,177,358$
1 Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which was estimated in the FY 2017-18 budget process.
17
City of Denton
Water Fund
Schedule of Revenues and Expenditures - Budget vs Projections (Unaudited)
For the Period Ended March 31, 2018
PRIOR BUDGET CURRENT ANNUAL ANNUAL BUDGET VS
DESCRIPTION Y-T-D Y-T-D Y-T-D BUDGET2 PROJECTION PROJECTION
Beginning Working Capital
and Reserves as of 09/30/171 20,851,375$ 23,340,901$
REVENUES:
Water Sales Residential 7,413,348$ 8,095,956$ 7,984,325$ 19,550,225 18,585,215 -5%
Water Sales Commercial 7,241,567 7,753,017 7,576,402 17,016,173 16,575,408 -3%
Water for Resale 276,169 286,640 1,947,832 553,406 1,719,330 211%
Other Water 626,953 411,837 672,413 811,832 800,099 -1%
Transfers In 3,199,788 2,973,642 2,973,641 5,947,281 5,808,155 -2%
Investment Income 90,114 87,500 124,691 175,000 174,000 -1%
Impact Fee Revenue 2,000,800 1,877,702 1,878,454 3,755,404 3,755,404 0%
Total Revenues 20,848,739 21,486,294 23,157,758 47,809,321 47,417,611 -1% Use of Reserves - - - -
EXPENDITURES:
Personal Service 4,661,709 5,501,243 4,814,427 11,408,173 10,963,036 -4%
Purchased Power 576,386 782,838 589,780 1,600,000 1,561,851 -2%
Materials and Supplies 597,823 751,049 632,358 1,721,614 1,686,976 -2%
Maintenance and Repairs 608,996 561,679 554,003 1,552,572 1,373,808 -12%
Insurance 119,474 111,241 111,241 222,481 219,101 -2%
Miscellaneous 167,943 183,297 128,570 342,778 338,969 -1%
Operations, Services 1,041,210 1,339,908 953,794 2,514,509 2,413,496 -4%
Capital Outlay 2,357,824 3,161,567 2,661,685 9,111,143 9,167,403 1%
Return on Investment 536,980 606,926 571,601 1,327,607 1,316,982 -1%
Franchise Fee 767,115 867,037 816,573 1,896,582 1,859,180 -2%
Debt Service 9,513,008 6,319,047 11,130,419 12,638,094 12,638,094 0%
Transfers Out 1,805,876 1,736,885 1,741,317 3,473,768 3,486,905 0%
Total Expenditures 22,754,344 21,922,717 24,706,835 47,809,321 47,025,801 -2%
Net Income (Loss)(1,905,605)$ (436,423)$ (1,549,077)$ - 391,810
Ending Working Capital
and Reserves 20,851,375$ 23,732,711$
1 The Beginning Working Capital balance excludes $6,650,271 of Impact Fee Reserves and $250,000 for Development Plan Line Reserves.
budget process.
2 Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which was estimated in the FY 2017-18
18
City of Denton
Wastewater Fund
Schedule of Revenues and Expenditures - Budget vs Projections (Unaudited)
For the Period Ended March 31, 2018
PRIOR BUDGET CURRENT ANNUAL ANNUAL BUDGET VS
DESCRIPTION Y-T-D Y-T-D Y-T-D BUDGET2 PROJECTION PROJECTION
Beginning Working Capital
and Reserves as of 09/30/171 15,926,057$ 17,861,887$
REVENUES:
Residential Fees 5,863,776$ 5,594,006$ 5,982,589$ 11,103,223 11,030,267 -1%
Commercial Fees 6,018,920 5,975,316 5,958,034 12,306,031 12,450,498 1%
Effluent Irrigation Fees 46,309 23,423 46,407 61,530 67,076 9%
Wholesale Fees 312,902 310,940 288,217 667,670 686,659 3%
Other Wastewater Fees 1,036,595 740,080 624,596 1,642,282 1,659,542 1%
Transfer In 600,409 329,515 447,015 659,030 659,030 0%
Investment Income 64,561 58,750 102,650 117,500 117,500 0%
Impact Fee Reserves 1,760,704 1,000,000 1,000,400 2,000,000 2,000,000 0%
Total Revenues 18,010,876 16,349,135 16,823,856 33,230,472 33,320,334 0%
EXPENDITURES:
Personal Service 3,535,590 3,828,622 3,635,806 8,103,746 7,622,072 -6%
Purchased Power 451,008 645,680 516,459 1,221,000 1,020,000 -16%
Materials and Supplies 482,857 436,942 481,904 1,260,309 1,235,111 -2%
Maintenance and Repairs 562,172 657,415 544,326 1,464,909 1,433,129 -2%
Insurance 93,838 90,246 90,246 180,492 180,492 0%
Miscellaneous 35,326 42,721 38,872 54,631 72,150 32%
Operations, Services 922,167 1,025,142 943,693 2,212,647 2,105,661 -5%
Capital Outlay 5,358,206 3,435,891 1,788,993 6,871,781 7,104,146 3%
Return on Investment 442,046 443,495 440,159 902,326 902,791 0%
Franchise Fee 631,494 633,564 628,799 1,289,037 1,289,702 0%
Debt Service 5,978,759 6,428,552 6,428,552 7,169,780 7,167,280 0%
Transfers Out 1,702,311 1,646,194 1,649,715 3,292,383 3,297,565 0%
Total Expenditures 20,195,774 19,314,464 17,187,524 34,023,041 33,430,099 -2%
Net Income (Loss)(2,184,898)$ (2,965,329)$ (363,668)$ (792,569) (109,765)
Ending Working Capital
and Reserves 15,133,488$ 17,752,122$
1 The Beginning Working Capital balance excludes $2,194,686 of Impact Fee Reserves, $1,000,000 for Drainage Reserves,
and $335,000 for Development Plan Line Reserves.
2 Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which was estimated
in the FY 2017-18 budget process.
19
City of Denton
Drainage Operations
Schedule of Revenues and Expenditures - Budget vs Projections (Unaudited)
For the Period Ended March 31, 2018
PRIOR BUDGET CURRENT ANNUAL ANNUAL BUDGET VS
DESCRIPTION Y-T-D Y-T-D Y-T-D BUDGET PROJECTION PROJECTION
REVENUES:
Residential Drainage Fees 876,935$ 884,205$ 900,012$ 1,773,100$ 1,788,253$ 1%
Nonresidential Drainage Fees 1,429,765 1,432,855 1,473,936 2,900,106 2,861,509 -1%
Wastewater Resources - 21,900 - 43,800 100,000 128%
General Fund Transfer 250,668 212,015 212,015 424,030 424,030 0%
Total Revenues 2,557,368 2,550,975 2,585,963 5,141,036 5,173,792 1%
EXPENDITURES:
Personal Service 706,934 828,401 767,309 1,773,782 1,537,953 -13%
Materials and Supplies 14,948 38,492 20,780 82,425 82,120 0%
Maintenance and Repairs 37,172 61,173 35,477 131,300 122,200 -7%
Insurance 9,913 12,731 12,730 25,461 25,461 0%
Miscellaneous 2,721 9,408 6,483 16,000 16,000 0%
Operations, Services 144,576 232,452 151,156 549,531 531,509 -3%
Capital Outlay 726,059 439,377 663,475 1,281,581 1,555,786 21%
Debt Service 597,449 627,356 627,356 677,790 677,790 0%
Transfer Out 317,596 301,585 301,197 603,166 624,973 4%
Total Expenditures 2,557,368 2,550,975 2,585,963 5,141,036 5,173,792 1%
Net Income (Loss)-$ -$ -$ -$ -$
20
City of Denton
Solid Waste Fund
Schedule of Revenues and Expenditures - Budget vs Projection (Unaudited)
For the Period Ended March 31, 2018
PRIOR BUDGET CURRENT ANNUAL ANNUAL BUDGET VS
DESCRIPTION Y-T-D Y-T-D Y-T-D BUDGET2 PROJECTION PROJECTION
Beginning Working Capital
and Reserves as of 09/30/171 8,151,875$ 9,468,891$
REVENUES:
Garbage Fees - Residential 5,561,630$ 5,621,822$ 5,643,831$ 11,341,462 10,731,480 -5%
Garbage Fees - Commercial 7,262,095 7,872,753 7,588,300 16,127,040 15,383,659 -5%
Landfill Fees 3,030,772 3,259,297 2,709,821 6,836,245 5,912,370 -14%
Materials Processing 58,557 774,860 66,986 1,549,100 133,972 -91%
Recycling and Public Outreach 435,323 437,562 428,064 874,776 778,450 -11%
Site Operations 110,858 415,592 102,543 830,851 206,729 -75%
Other Revenue 273,405 221,863 401,070 443,550 444,749 0%
Investment Income 8,974 7,503 26,164 15,000 53,000 253%
Total Revenues 16,741,614 18,611,252 16,966,779 38,018,024 33,644,409 -12%
EXPENDITURES:
Personal Service 5,036,312 5,840,016 5,018,597 11,683,418 10,936,005 -6%
Materials and Supplies 179,778 261,730 98,909 523,955 403,943 -23%
Maintenance and Repairs 234,428 339,843 129,200 671,275 527,700 -21%
Insurance 112,251 116,858 116,815 233,631 233,631 0%
Miscellaneous 39,366 38,171 44,766 89,900 67,859 -25%
Operations, Services 2,969,944 3,913,812 2,483,297 7,710,268 6,375,950 -17%
Capital Outlay 2,306,692 1,285,310 156,487 2,669,510 350,000 -87%
Debt Service 7,317,867 8,686,037 8,686,037 9,700,467 9,542,116 -2%
Franchise Fee 821,421 950,834 847,501 1,900,902 1,679,143 -12%
Landfill Closure 132,824 189,454 189,378 378,757 1,143,059 202%
Transfer Out 1,475,159 1,483,603 1,590,783 2,966,003 2,966,003 0%
Total Expenditures 20,626,042 23,105,668 19,361,770 38,528,086 34,225,409 -11%
Net Income (Loss)(3,884,428)$ (4,494,416)$ (2,394,991)$ (510,062) (581,000)
Ending Working Capital
and Reserves 7,641,813$ 8,887,891$
1 The Beginning Working Capital Reserve excludes $8,654,114 Landfill Closure/Post Closure Reserves.
2 Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which was estimated in the FY 2017-18 budget process.
21
City of Denton
Airport Fund
Schedule of Revenues and Expenditures - Budget vs Projection (Unaudited)
For the Period Ended March 31, 2018
PRIOR BUDGET CURRENT ANNUAL ANNUAL BUDGET VS
DESCRIPTION Y-T-D Y-T-D Y-T-D BUDGET1 PROJECTION PROJECTION
Beginning Working Capital
and Reserves as of 09/30/17 2,471,421$ 2,748,875$
OPERATING REVENUES:
Airport Ground Leases 276,911$ 356,720$ 398,075$ 713,154 675,255 -5%
FBO Commissions 76,730 99,944 142,927 199,808 260,000 30%
Miscellaneous 35,230 46,327 39,069 92,619 106,800 15%
Total Operating Revenues 388,871 502,991 580,071 1,005,581 1,042,055 4%
OPERATING EXPENDITURES:
Personal Service 288,800 265,341 224,922 530,482 447,533 -16%
Materials and Supplies 11,310 23,360 5,745 46,700 44,330 -5%
Maintenance and Repairs 34,297 52,616 16,132 105,193 105,193 0%
Insurance 10,802 10,916 10,911 21,823 21,823 0%
Miscellaneous 386 600 349 1,200 800 -33%
Operations 59,977 119,127 57,785 238,160 232,912 -2%
Transfers Out - Operating 235,111 273,643 259,920 547,070 547,070 0%
Total Operating Expenses 640,683 745,603 575,764 1,490,628 1,399,661 -6%
Operating (Loss)(251,812) (242,612) 4,307 (485,047) (357,606)
NON-OPERATING REVENUES:
Investment Income 17,762 12,505 28,689 25,000 57,378 130%
Gas Well Royalties 181,002 237,159 94,671 474,130 444,800 -6%
Total Non-Operating Revenues 198,764 249,664 123,360 499,130 502,178 1%
NON-OPERATING EXPENDITURES:
Transfers Out - Capital - 112,545 225,000 225,000 225,000 0%
Total Non-Operating Expenses - 112,545 225,000 225,000 225,000 0%
Non-Operating Income (Loss)198,764 137,119 (101,640)274,130 277,178
Net Income (Loss)(53,048)$ (105,493)$ (97,333)$ (210,917)(80,428)
Ending Working Capital 2,260,504$ 2,668,447$
1 Annual adopted budget as amended or modified. Beginning Working Capital and Reserves represents the amount which was estimated in the FY 2017-18 budget process.
22
City of Denton
Street Improvement Fund
Schedule of Expenditures - Budget vs Projection (Unaudited)
For the Period Ended March 31, 2018
PRIOR BUDGET CURRENT ANNUAL ANNUAL BUDGET VS
DESCRIPTION Y-T-D Y-T-D Y-T-D BUDGET1 PROJECTION PROJECTION
Beginning Working Capital
and reserves as of 9/30/2017 1,253,048$ 1,158,667$
REVENUES:
Franchise Fees 4,578,021$ 6,240,525$ 5,022,192$ 12,476,060 12,476,060 0%
Street Cuts 122,505 178,572 129,474 357,000 357,000 0%
Investment Income 8,909 5,002 440 10,000 10,000 0%
Transfers In 528,687 559,292 517,291 1,118,135 1,118,135 0%
Miscellaneous 41 - 1,505 - -
Total Revenues 5,238,163 6,983,391 5,670,902 13,961,195 13,961,195 0%
EXPENDITURES:
Personal Service 1,384,064 1,720,676 1,640,472 3,439,984 3,439,984 0%
Materials and Supplies 72,831 43,587 48,022 87,150 87,150 0%
Maintenance and Repairs 2,949,714 3,166,865 3,190,382 7,722,677 7,722,677 0%
Insurance 21,511 25,856 25,847 51,693 51,693 0%
Miscellaneous 3,609 2,501 4,292 5,000 5,000 0%
Operations, Services 390,400 480,288 315,617 830,302 830,302 0%
Transfer Out 624,294 1,543,602 1,545,281 1,824,389 1,824,389 0%
Total Expenditures 5,446,423 6,983,375 6,769,913 13,961,195 13,961,195 0%
Net Income (Loss)(208,260)$ 16$ (1,099,011)$ - -
Ending Fund Balance 1,253,048$ 1,158,667$
1Annual adopted budget as amended or modified. Beginning Fund Balance represents the amount which was estimated in the FY 2017-18 budget process.
23
City of Denton
Grants
Schedule of Expenditures - Budget vs Projection (Unaudited)
For the Period Ended March 31, 2018
GRANT DESCRIPTION
EXPENDITURES
AS OF 9/30/20172 CURRENT
Y-T-D
ANNUAL
BUDGET
ANNUAL
PROJECTION
BUDGET VS
PROJECTION
FY 2017-18 Budget
US Dept of HUD -
Community Development Block Grant(CDBG)2,775,354$ 318,114$ 1,893,649$ 600,000$ -68%
US Dept of HUD -
HOME Investment Partnership Program 2,816,384 294,768 1,046,759 450,000 -57%
Community Development1 5,591,738 612,882 2,940,408 1,050,000 -64%
TxDot STEP Comprehensive Grant - 33,426 91,464 91,464 0%
2016 UASI - 100,071 130,000 130,000 0%
2017 UASI - 5,656 98,200 98,200 0%
Emergency Management Performance Grant - - 46,825 46,825 0%
2016 Tobacco Enforcement Grant - - 7,350 - -100%
Staffing for Adequate Fire & Emergency Response - - 419,971 419,971 0%
Public Safety - 139,153 793,810 786,460 -1%
Airport Maintenance (RAMP) Grant - 16,359 50,000 50,000 0%
TxDot-RTR-Mayhill Rd-IH35 E to US 380 14,203,683 5,799,579 33,197,821 18,000,000 -46%
TxDot-RTR-Bonnie Brae Rd-IH35 E to US 377 9,189,164 3,169,336 39,579,553 7,000,000 -82%
County-Traffic Signal-US 380-Cindy Lane - - 53,865 - -100%
TxDot-IH35E at Loop 288/Lillian Miller Pkwy - - 37,000 37,000 0%
TxDot-RTR-McKinney (Formerly FM426) 138 462,157 18,267,303 1,300,000 -93%
TxDot-Hickory Creek FM2181-FM2499 2,294 - 2,397,706 400,000 -83%
NCTCOG Regional HHW Drop-Off Facility Project - - 55,898 - -100%
Bicycle & Pedestrian Projects Grant - - 1,500,000 195,000 -87%
Transportation1 23,395,279 9,447,431 95,139,146 26,982,000 -72%
Interlibrary Loan Program (ILL) - - 25,000 25,000 0%
TIFMAS Training Tuition Grant - 4,250 10,000 10,000 0%
Other - 4,250 35,000 35,000 0%
Total FY 2017-18 Budget 28,987,017 10,203,716 98,908,364 28,853,460 -71%
New Awards
Emergency Solutions Grant - 125,487 600,000 500,000 -17%
Community Development - 125,487 600,000 500,000 -17%
Federal Equitable Sharing - 13,067 13,067 13,067 0%
Chapter 59 Asset Forfeitures - 18,560 18,560 18,560 0%
U.S. Marshals Violent Offenders Task Force - 10,136 10,136 10,136 0%
PD-Law Enforcement Officer Standards &
Education - 11,618 11,618 11,618 0%
Sexual Assault Nurse Examiners (SANE)
Reimbursement - 22,139 22,139 22,139 0%
2017 SHSP Ballistic Blankets - - 3,000 3,000 0%
2017 SHSP Night Vision - - 14,200 14,200 0%
2017 UASI Command Data - - 30,000 30,000 0%
Body Armor Grant Program - - 91,692 91,692 0%
2018 SHSP SWAT Equipment Enhancement - - 24,000 24,000 0%
Public Safety - 75,520 238,412 238,412 0%
24
City of Denton
Grants
Schedule of Expenditures - Budget vs Projection (Unaudited)
For the Period Ended March 31, 2018
GRANT DESCRIPTION
EXPENDITURES
AS OF 9/30/20172 CURRENT
Y-T-D
ANNUAL
BUDGET
ANNUAL
PROJECTION
BUDGET VS
PROJECTION
TxDot-N TX Blvd Roundabout 11,805 - 1,988,195 400,000 -80%
TxDot-RTR-ITS COMM Trunk Line 253,372 36,751 1,318,228 1,000,000 -24%
TxDot-US 77 At Nicosia Street - 32,795 38,240 38,240 0%
TxDot-FM 2499 At State School Road - 6,703 21,597 21,597 0%
TxDot-FM 2499 At Unicorn Lake - 21,491 21,638 21,638 0%
Transportation1 265,177 97,740 3,387,898 1,481,475 -56%
TxDot NW Trail Extension Grant 1,086,685 212,273 212,273 212,273 0%
Parks and Recreations 1,086,685 212,273 212,273 212,273 0%
Total New Awards 1,351,862 511,020 4,438,583 2,432,160 -45%
TOTALS 30,338,879$ 10,714,736$ 103,346,947$ 31,285,620$ -70%
1 This grant amount will be spent over several years and the fiscal year 2017-18 projections are just estimated expenditure in the one year.
Remaining grant amounts will be spent in future fiscal year.
2 A portion of the grants presented cover multiple years.
25
Eureka 2 Playground
26
Section 3
City of Denton
Quarterly Financial Report
March 2018
REVENUE & ECONOMIC
ANALYSIS
27
Revenue & Economic Analysis
Summary
The data included in this section provides information on local, state
and national trends impacting the City’s financial position.
The following notes are provided to facilitate this section’s readability.
1. Positive Outlook – Represents favorable conditions for the local
economy. Color code – Green.
2. Cautious Outlook – Represents changing conditions that
require close monitoring. Color code – Yellow.
3. Negative Outlook – Represents unfavorable conditions for the
local economy. Color code – Red.
The data included in this section have been obtained from a variety of
sources. Sales tax and construction related data have been obtained
from internal city departments. Economic data for the State have
been obtained from the Federal Reserve Bank of Dallas and may be
subject to availability. National economic data were compiled with
assistance from the City’s investment advisor, First Southwest Asset
Management.
28
National Economic Trends
Period Ending March 31, 2018
Gross Domestic Product (GDP)
The U.S. economy grew at an annualized rate
of +2.3% in the first three months of 2018.
Although this was the slowest quarterly pace
in a year, it topped the +2.0% median forecast,
and was the best first quarter reading since
2015. Personal consumption rose by just
+1.1%, the weakest consumer spending since
the second quarter of 2013. Business
investment remained relatively solid, making
a significant contribution to overall growth.
Residential spending (housing) was flat in the
first quarter after surging at the end of 2017.
Business inventory accumulation was positive
to begin the year adding 4/10th to the overall
number while net exports added another
2/10th. The report also indicated inflation
moved higher during the quarter despite only
modest economic growth.
Nonfarm Payrolls
Nonfarm payrolls rose by +103k in March,
significantly below the +185k median forecast,
while downward revisions to the previous two
months extracted -50k from the January and
February count. Inclement weather played a
role in the March miss, suggesting an April
rebound. The monthly average for the first
quarter was +202k, a disappointment given
loftier expectations, but plenty solid in the
midst of what is now the second longest
expansion cycle in history. Headline
unemployment (including only those actively
seeking work) held steady at 4.1% for the sixth
straight month as the more volatile household
survey indicated a loss of -37k jobs and a -158k
drop in the labor force. The broader U6
unemployment rate (which includes everyone
who would accept a suitable fulltime job if it
were offered) fell from 8.2% to an 11-year low
of 8.0%.
29
Inflation
The Producer Price Index continues to show
inflationary pressure in the pipeline.
Headline PPI rose +0.3% in March, lifting the
year-over-year (yoy) pace from +2.8% to
+3.0%. Core PPI, which excludes food and
energy prices, also rose +0.3%, boosting the
yoy pace from +2.5% to +2.7%. The
Consumer Price Index also showed signs of
higher inflation in March. Lower energy
prices drove headline CPI down -0.1%, but
the yoy pace rose from +2.2% to +2.4%, the
highest in 12 months. Core CPI rose +0.2%
in March, pushing the yoy pace up from
+1.8% to a 13-month high of +2.1%. PCE
core crept up from +1.5% to 1.6% y-o-y in
February. As long as the inflation trend is
upward, the FOMC should remain on its
tightening path.
Retail Sales
Overall retail sales, bolstered by higher auto
sales, rose +0.6% in March, bettering the
+0.4% median forecast.
The retail sales control group (used to
calculate GDP) rose by +0.4%, exactly
matching forecast. Both the overall and
control group showed a monthly gain for the
first time since November.
Consumers had hibernated ever since a
buying splurge around the Thanksgiving
holiday. The solid March data is encouraging
(and long overdue) but a single month
doesn’t make a trend. Up to this point, the
lack of consumer spending after the tax
reform was passed is confounding.
Confidence remains near a 17-year high,
suggesting that consumers are optimistic, but
record levels of household credit may act as
a deterrent.
30
Texas Home Sales
Texas home sales fell by -12.9% in the first
quarter and -6.8% on a year-over-year basis.
The average Texas home price in March was
$282.4k, a +4.6% increase over the previous
year, but down from the high of $286.7 last
May.
In Denton County, unit home sales fell -15.3%
during the quarter (due to unusually slow
January and February sales), but rose -1.6%
over the same period a year ago. The average
home price in March was $355.2k, a +5.3%
year-over-year increase and the highest
average recorded in any single month. Total
Denton County listings in December were
2,733, approximately +3% higher than a year
ago. The available inventory at year end was
just 2.2 months; very close to the 1.7 month
historical low recorded in December 2016.
The paper was prepared by FirstSouthwest Asset Management, is intended for educational and informational purposes only and does not constitute legal or
investment advice, nor is it an offer or a solicitation of an offer to buy or sell any investment or other specific product. Information provided in this paper was
obtained from sources that are believed to be reliable; however, it is not guaranteed to be correct, complete, or current, and is not intended to imply or establish
standards of care applicable to any attorney or advisor in any particular circumstances. The statements within constitute the views of FirstSouthwest Asset
Management as of the date of the report and may differ from the views of other divisions/departments of Hilltop Securities. In addition, the views are subject
to change without notice. This paper represents historical information only and is not an indication of future performance.
31
Fuel Prices Outlook Cautious
Description: Quarterly fuel trends for the United States and Texas.
Analysis:Fuel prices are a major commodity source in the economy. Studies have shown a positive effect on
disposable income levels when fuel prices decrease.It is estimated that for every penny decrease in the price of
fuel,$1.3 billion is available to the consumer for disposable income. Therefore, the price of fuel is likely to be a key
predictor of sales tax collections. Fuel prices showed a 2.0%increase from the prior quarter at the national level and
a 1.9% increase at the state level. Staff has rated this outlook as Cautious.
Source: U.S. Department of Energy
$0
$2
$4
$6
$8
$10
$12
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00
2Q '14 4Q '14 2Q '15 4Q '15 2Q '16 4Q '16 2Q '17 4Q '17 2Q '18 MillionsDollarsFuel Prices
Sales Tax Texas Fuel Prices US Fuel Prices
32
Municipal Cost Index Outlook Negative
Description:The Municipal Cost Index was developed to show the rate of inflation for the cost of goods purchased
frequently by local governments. The MCI draws on the monthly statistical data collected by the U.S. Departments
of Commerce and Labor as well as independently compiled data to project a composite cost picture for the
municipal budget officer or operating department manager. Costs of labor, materials and contract services are all
factored into the composite MCI. Major indicators of these items used for the MCI include the Consumer Price
Index, the Wholesale Price Index for Industrial Commodities (now known as the Producer Price Index) and the
construction cost indexes published by the U.S. Department of Commerce, respectively.
Analysis:The Municipal Cost Index (MCI) pulls a variety of prices for frequently purchased commodities for local
governments. The cost for labor, materials and contract services are factored for the MCI.An increase in MCI
means the overall price mix for these types of commodities will cost local governments more to do routine business.
The 2nd Quarter of 2017-18 shows an increase of 1.8% over the prior quarter and an increase of 9.1% over the 2nd
Quarter of 2016-17. Staff has rated this indicator as Negative.
Note: The Municipal Cost Index is designed to show the effects of inflation on the cost of providing municipal services. State
and local government officials rely on American City & County's Municipal Cost Index to stay on top of price trends, help control
price increases for commodities, make informed government contract decisions and intelligent budget planning. Since 1978,
readers have loyally referred to the Municipal Cost Index to determine the cost of inflation and, hence, the rising cost of doing
business as a local government.
Source: American City and County Magazine
220.00
225.00
230.00
235.00
240.00
245.00
250.00
2Q '16 3Q '16 4Q '16 1Q '17 2Q '17 3Q '17 4Q '17 1Q '18 2Q '18
Municipal Cost Index
33
Hotel Occupancy Tax Analysis Outlook Positive
2nd Quarter FY 2017‐18
Actual Y‐T‐D
Occupancy Tax Revenue:644,988$ 1,234,059$
FY 2016‐17 Budget 681,973$ 1,367,666$
Over (Under) Budget (36,985)$ (133,607)$
Hotel Occupancy Tax Budget:3,052,174$
3,052,174$
Variance:‐$
Description:Tax imposed on a person who, under a lease, concession, permit, right of access, license, contract, or
agreement, pays for the use of a room that is in a hotel. A hotel includes: any building in which the public may obtain
sleeping accomodations; motels; a tourist home, house or court; lodginghouse; inn; roominghouse; or bed and
breakfast. The tax rate levied by the City is 7% of the price paid for a room. The State also levies a tax equal to 6%.
Analysis:While the use of this revenue source is restricted by state law, it is an essential revenue source for various
tourist related activities within the community and an important indicator of local economic activity. Hotel Occupancy
tax revenue through the 2nd Quarter of FY 2018 was 6.15% less than budget and 20.3% more than the prior year's
actual. Staff has rated the outlook for this economic indicator as Positive.
FISCAL YEAR FORECAST
End of Year Projection:
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
Hotel Occupancy Tax Collections
FY 2014‐15 FY 2015‐16 FY 2016‐17 FY 2017‐18
34
Sales and Use Tax Analysis Outlook Positive
2nd Quarter FY 2017‐18
Actual Y‐T‐D
Revenue: Gross Sales Tax
Municipal Operations 461,732$ 899,499$
General Retail & Others 9,110,613 18,747,547
Comptroller Fees (178,738) (367,773)
Amount Retained (175,164) (360,419)
Total Revenue 9,218,443$ $18,918,854
Expenses: Economic Incentives
Denton Crossing1 132,548$ 289,235$
Unicorn Lake2 19,521 37,043
Rayzor Ranch3 305,472 653,387
Golden Triangle4 35,943 100,078
Total Expenses 493,484$ 1,079,743$
Net Total 8,724,959 17,839,111
FY 2017‐18 Budget 7,838,988 16,415,515
Over(Under) Budget 885,971$ 1,423,596$
Sales Tax Budget:36,181,385$
Year End Projection:39,202,935
Variance to Original Budget:3,021,550$
Economic Development Expenditure Budget:2,373,819$
Year End Projection:2,060,599
Variance to Original Budget:(313,220)$
1. Incentive is 50% of general sales taxes. For the 2nd quarter sales tax equaled $265,096.
2. Incentive is 50% of general sales taxes. For the 2nd quarter sales tax equaled $39,042.
3. Incentive is 75% of general sales taxes. For the 2nd quarter sales tax equaled $407,296.
4. Incentive is 75% of general sales taxes. For the 2nd quarter sales tax equaled $47,924.
Description:Tax imposed on all retail sales, leases, and rentals of most goods, as well as taxable services. The total tax
rate levied within the City is 8.25% (State, 6.25%; City, 1.5%; DCTA, 0.5%).
Analysis:As the second largest revenue source to the City's General Fund, sales and use taxes are essential to the
delivery of services to the community. Sales tax revenues through the 2nd quarter of FY 2018 compared to revenues
from the prior year 2nd quarter shows a 10.52% increase, and compared to the budget it is 11.30% above. Staff has
rated this indicator as Positive.
$0.0
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
$7.0
$8.0
$9.0
$10.0
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
Gross Sales Tax Collections (Millions)
FY 2013‐14 Actual FY 2014‐15 Actual FY 2015‐16 Actual FY 2016‐17 Actual FY 2017‐18 Actual
35
Certificates of Occupancy Outlook Negative
Source: City of Denton's Development Services Department.
Description:Certificates of Occupancy (CO) are permits issued in compliance with the 2009 International Building
Code (IBC)and applicable City ordinances. The IBC states, "that no building shall be used or occupied,and no change
in the existing occupancy classification of a building or structure or portion thereof shall be made, until the building
official has issued a certificate of occupancy." Certificates of Occupancy ensure that applicable building, fire and
consumer health codes are met.
Analysis:Certificates of Occupancy are an economic indicator that provides a framework for the overall condition of
the local economy. Certificates of Occupancy decreased 42.8%from the prior quarter and decreased 30.56%from
the 2nd Quarter of 2017. Staff has rated the outlook for this revenue indicator as Cautious.
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
2Q
'13
3Q
'13
4Q
'13
1Q
'14
2Q
'14
3Q
'14
4Q
'14
1Q
'15
2Q
'15
3Q
'15
4Q
'15
1Q
'16
2Q
'16
3Q
'16
4Q
'16
1Q
'17
2Q
'17
3Q
'17
4Q
'17
1Q
'18
2Q
'18
Certificates of Occupancy
36
Residential Permits Outlook Positive
Source: City of Denton's Development Services Department.
Description:Residential Permits are issued in compliance with the 2009 International Residential Code (IRC)and
applicable City ordinances. The data presented in this analysis only include new permits issued and not
remodels/alterations.
Analysis:Residential Permits are an economic indicator that provides a framework for the overall condition of the
local economy.In particular, residential permits have a direct correlation with building inspection fees and
appraised values. Residential permits increased 64.0%from the prior quarter and increased 47.7%from the 2nd
Quarter of 2017. Staff has rated the outlook for this revenue indicator as Positive
0.0
50.0
100.0
150.0
200.0
250.0
2Q
'13
3Q
'13
4Q
'13
1Q
'14
2Q
'14
3Q
'14
4Q
'14
1Q
'15
2Q
'15
3Q
'15
4Q
'15
1Q
'16
2Q
'16
3Q
'16
4Q
'16
1Q
'17
2Q
'17
3Q
'17
4Q
'17
1Q
'18
2Q
'18
Residential Permits
37
Texas Leading Indicators Index Outlook Positive
Source: Federal Reserve Bank of Dallas
Description:The Texas Leading Indicators Index is a single weighted summary statistic that sheds light on the future
of the state's economy. The index is designed to signal movements and changes in the state's rate of growth. The
index includes the following leading indicators: Texas Value of the Dollar, U.S. Leading Index, Real Oil Prices, Well
Permits, Initial Claims for Unemployment Insurance, Texas Stock Index, Help-Wanted Advertising,and Average
Weekly Hours Worked in Manufacturing.
Analysis:Texas Leading Indicators provide a framework for the overall condition of the local economy. Data for this
quarter shows an increase in the state's rate of growth. The index increased 2.4%from the prior quarter and
increased 6.11% from the 2nd Quarter of 2016-17. Staff has rated this indicator as Positive
100.0
105.0
110.0
115.0
120.0
125.0
130.0
135.0
140.0
2Q
'08
4Q
'08
2Q
'09
4Q
'09
2Q
'10
4Q
'10
2Q
'11
4Q
'11
2Q
'12
4Q
'12
2Q
'13
4Q
'13
2Q
'14
4Q
'14
2Q
'15
4Q
'15
2Q
'16
4Q
'16
2Q
'17
4Q
'17
2Q
'18
Texas Leading Indicators Index
38
Unemployment Rate Index Outlook Positive
Description:Unemployment is defined as the number or proportion of people looking for work at the prevailing
wage who are unable to find employment.
Analysis:Unemployment is an economic indicator that provides a framework for the overall condition of the
national, state and local economies. The unemployment rate for the City of Denton is at 3.1%for the 2nd Quarter.
The unemployment rates for most of the other reported sectors were either up slightly or flat from the prior quarter.
As a result of the downward trend since the high of the 2nd Quarter of 2012,staff has rated the outlook for this
revenue indicator as Positive.
Note:U6 unemployment includes marginally attached workers who currently are neither working nor looking for work but
indicate that they want and are available for a job and have looked for work sometime in the recent past. Discouraged
workers, a subset of the marginally attached, have given a job-market related reason for not looking currently for a job.
Persons employed part-time for economic reasons are those who want and are available for full-time work but have had to
settle for a part-time schedule.
Source: Federal Reserve Bank of Dallas, U.S. Bureau of Labor Statistics, and Texas Workforce Commission
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
1Q '12 3Q '12 1Q '13 3Q '13 1Q '14 3Q '14 1Q '15 3Q '15 1Q '16 3Q '16 1Q '17 3Q '17 1Q '18
Unemployment Rate Index
Dallas-Plano-Irving MD Denton Texas U6 Unemployment United States
39
Section 4
City of Denton
Quarterly Financial Report
March 2018
INVESTMENT REPORT
40
2nd Fiscal Quarter 2018 - March 31, 2018 Page 1
INVESTMENT POOL
Policy
Par Market Book Unrealized Max.Benchmark
Portfolio:Value Value Value Gain/(Loss)1 WAM WAM YTM Yield*
Investment Pool 608,515,986$ 605,052,760$ 608,179,960$ (3,127,200)$ 309 550 1.42%1.46%
*Twelve month moving average of a one year
U.S. T-bill yield
% of Total
Par Market Book Unrealized Portfolio Policy
Securities By Investment Type:Value Value Value Gain/(Loss)1 WAM YTM (Book Value) Max.
U.S. Treasuries 17,000,000 16,849,721 16,958,860 (109,139) 313 1.23% 2.79%100.00%
U.S. Federal Agencies 323,756,000 320,650,279 323,527,701 (2,877,422) 427 1.34% 53.20%100.00%
Municipal Bonds 14,500,000 14,379,250 14,500,000 (120,750) 297 1.11% 2.38%15.00%
Certificates of Deposit 126,000,000 126,000,000 126,000,000 - 310 1.57% 20.72%35.00%
Commercial Paper 36,000,000 35,913,524 35,933,413 (19,889) 64 1.67% 5.91%15.00%
Local Government Investment Pools 58,324,172 58,324,172 58,324,172 - 1 1.49% 9.59%50.00%
Insured Cash Sweep Savings Deposits 25,000,000 25,000,000 25,000,000 - 1 1.55% 4.11%15.00%
Demand Deposits 7,935,814 7,935,814 7,935,814 - 1 0.80% 1.30%-
Total Portfolio 608,515,986$ 605,052,760$ 608,179,960$ (3,127,200)$ 309 1.42% 100.00%-
Current 3 Months Ago 3 Month 1 Year Ago
Investment Pool Comparisons:3/31/2018 12/31/2017 Difference 3/31/2017
Par Value 608,515,986$ 664,555,916$ (56,039,930)$ 688,707,818$
Market Value 605,052,760$ 661,960,386$ (56,907,626)$ 688,352,400$
Book Value 608,179,960$ 664,403,888$ (56,223,928)$ 689,137,045$
Unrealized Gain(Loss)(3,127,200)$ (2,443,502)$ (683,698)$ (784,645)$
Weighted Average Maturity 309 329 (20) 374
Yield to Maturity 1.42%1.29%0.13%1.07%
Portfolio Composition:
U.S. Treasuries 2.79%8.13%-5.34%6.43%
U.S. Federal Agencies 53.20%50.99%2.20%45.88%
Municipal Bonds 2.38%3.43%-1.06%4.65%
Certificates of Deposit 20.72%20.47%0.25%20.90%
Commercial Paper 5.91%6.90%-1.00%8.67%
Local Government Investment Pools 9.59%5.93%3.65%13.07%
Insured Cash Sweep Savings Deposits 4.11%3.76%0.35%0.00%
Demand Deposits 1.30%0.39%0.92%0.40%
Bank Collateral Review**:Institution Collateral Type Market Value Collected Balance Collateral Ratio
Wells Fargo Demand Deposits BNY Mellon U.S. Agency MBS 35,879,211$ 1,395,672$ 2570.75%
LegacyTexas Bank Certificates of Deposit*** Fed Home Loan Bank Standby LOC 65,220,000$ 63,222,104$ 103.16%
Independent Bank Certificates of Deposit Fed Home Loan Bank Standby LOC 16,950,000$ 15,173,263$ 111.71%
**Does not include FDIC insurance
***Formerly, ViewPoint Bank
Depository Ledger Balance Review:Institution Account Type Beginning Bal. Deposits Ending Bal.
Wells Fargo Bank Checking 1,729,347$ 82,281,926$ 7,935,814$
Compliance Statement & Review:
Director of Finance Treasury Manager
(76,075,459)$
Preparer: Kevin Ann Mullen, CPA
ANTONIO PUENTE, JR.KEVIN ANN MULLEN
Withdrawals
The Quarterly Investment Report is in full compliance with the objectives, restrictions, and strategies as set forth in the City of Denton's Investment
Policy and the Public Funds Investment Act (Texas Government Code, Chapter 2256.023).
Reviewer: Antonio Puente, Jr., CGFO
7.30%
-0.18%
0.90%
Pledge Required
-2.77%
> 102%
> 100%
> 100%
-3.48%
4.11%
(65)
0.35%
-2.27%
(83,299,640)$
(80,957,085)$
(2,342,555)$
-3.63%
CITY OF DENTON : QUARTERLY INVESTMENT REPORT
1 Year Ago
Difference
(80,191,832)$
1Unrealized gain/(loss) is the difference between the market and book value and does not represent an actual gain or loss. Gains and losses are
realized only when a security is sold prior to maturity. Since it is the City's practice to hold investments until they mature, the temporary gains and
losses are unlikely to be realized.
41
2nd Fiscal Quarter 2018 - March 31, 2018 Page 2
INVESTMENT POOL
Current 3 Months Ago 3 Month 1 Year Ago 1 Year
3/31/2018 12/31/2017 Difference 3/31/2017 Difference
Par Value - U.S. Treasuries 17,000,000$ 54,000,000$ (37,000,000)$ 44,000,000$ (27,000,000)$
Par Value - U.S. Federal Agencies 323,756,000 338,756,000 (15,000,000) 316,000,000 7,756,000
Par Value - Municipal Bonds 14,500,000 22,800,000 (8,300,000) 31,860,000 (17,360,000)
Certificates of Deposit 126,000,000 136,000,000 (10,000,000) 144,000,000 (18,000,000)
Par Value - Commercial Paper 36,000,000 46,000,000 (10,000,000) 60,000,000 (24,000,000)
Local Government Investment Pools 58,324,172 39,424,172 18,900,000 90,064,298 (31,740,126)
Insured Cash Sweep Savings Deposits 25,000,000 25,000,000 - - 25,000,000
Demand Deposits 7,935,814 2,575,744 5,360,070 2,783,520 5,152,294
Total Par Value 608,515,986$ 664,555,916$ (56,039,930)$ 688,707,818$ (80,191,832)$
Market Value - U.S. Treasuries 16,849,721$ 53,875,122$ (37,025,401)$ 44,297,114$ (27,447,393)$
Market Value - U.S. Federal Agencies 320,650,279 336,610,728 (15,960,449) 315,554,445 5,095,834
Market Value - Municipal Bonds 14,379,250 22,686,733 (8,307,483) 31,871,960 (17,492,710)
Certificates of Deposit 126,000,000 136,000,000 (10,000,000) 144,000,000 (18,000,000)
Market Value - Commercial Paper 35,913,524 45,787,887 (9,874,363) 59,781,063 (23,867,539)
Local Government Investment Pools 58,324,172 39,424,172 18,900,000 90,064,298 (31,740,126)
Insured Cash Sweep Savings Deposits 25,000,000 25,000,000 - - 25,000,000
Demand Deposits 7,935,814 2,575,744 5,360,070 2,783,520 5,152,294
Total Market Value 605,052,760$ 661,960,386$ (56,907,626)$ 688,352,400$ (83,299,640)$
Book Value - U.S. Treasuries 16,958,860$ 53,988,660$ (37,029,800)$ 44,302,001$ (27,343,141)$
Book Value - U.S. Federal Agencies 323,527,701 338,795,485 (15,267,784) 316,195,085 7,332,616
Book Value - Municipal Bonds 14,500,000 22,813,784 (8,313,784) 32,009,718 (17,509,718)
Certificates of Deposit 126,000,000 136,000,000 (10,000,000) 144,000,000 (18,000,000)
Book Value - Commercial Paper 35,933,413 45,806,043 (9,872,630) 59,782,423 (23,849,010)
Local Government Investment Pools 58,324,172 39,424,172 18,900,000 90,064,298 (31,740,126)
Insured Cash Sweep Savings Deposits 25,000,000 25,000,000 - - 25,000,000
Demand Deposits 7,935,814 2,575,744 5,360,070 2,783,520 5,152,294
Total Book Value 608,179,960$ 664,403,888$ (56,223,928)$ 689,137,045$ (80,957,085)$
Accrued Interest 3,032,833$ 3,724,093$ (691,260)$ 2,779,815$ 253,018$
Cash Value -608,085,593$ 665,684,479$ (57,598,886)$ 691,132,215$ (83,046,622)$
(Total Market Value + Accrued Interest)
Unrealized Gain/(Loss)(3,127,200)$ (2,443,502)$ (683,698)$ (784,645)$ (2,342,555)$
Change in Fair Value since 9/30/17 -(1,919,786)$ (1,385,383)$ (534,403)$ (1,277,267)$ (642,519)$
(GASB 31)
Strategy Statement:The investment pool is an aggregation of the majority of City funds which may include tax receipts, enterprise fund revenues, fine and fee
income, as well as some, but not necessarily all bond proceeds, grants, gifts and endowments. This portfolio is maintained to meetanticipated daily cash needs for the City's operations, capital projects and debt service. In order to meet these obligations and to minimize
potential liquidation losses, the dollar-weighted stated average maturity of the investment pool shall not exceed 1.5 years or 550 days. The
objectives of this portfolio are to: (1) ensure safety of principal by investing in only high quality securities for which a strong secondary market
exists; (2) ensure that anticipated cash flow needs are matched with adequate investment liquidity; (3) limit market and credit risk throughdiversification; and (4) attain the best feasible yield, commensurate with the objectives and restrictions set forth in the Investment Policy, by
actively managing the portfolio to meet or exceed the twelve month moving average yield of a one year U.S. Treasury bill as derived from the
Federal Reserve Statistical Release H.15 for constant maturities.
CITY OF DENTON : QUARTERLY INVESTMENT REPORT
42
2nd Fiscal Quarter 2018 - March 31, 2018 Page 3
INVESTMENT POOL
Current 3 Months Ago 1 Year Ago
Summary By Security Type:3/31/2018 12/31/2017 3/31/2017
U.S. Treasuries - Coupon 16,958,860$ 53,988,660$ 44,302,001$
U.S. Federal Agencies - Coupon 302,771,196 308,038,429 296,195,825
U.S. Federal Agencies - Callable 20,756,505 30,757,056 19,999,260
Municipal Bonds - Coupon 14,500,000 22,813,784 32,009,718
Certificates of Deposit - CDARS 49,000,000 54,000,000 49,000,000
Certificates of Deposit - SLOC 77,000,000 82,000,000 95,000,000
Commercial Paper - Discount 35,933,413 45,806,043 59,782,423
Local Government Investment Pools 58,324,172 39,424,172 90,064,298
Insured Cash Sweep Savings Deposits 25,000,000 25,000,000 -
Demand Deposits 7,935,814 2,575,744 2,783,520
Total Book Value 608,179,960$ 664,403,888$ 689,137,045$
Objective:
Current 3 Months Ago 1 Year Ago
Summary By Security Type:3/31/2018 12/31/2017 3/31/2017
U.S. Treasuries - Coupon 2.79%8.13%6.43%
U.S. Federal Agencies - Coupon 49.79%46.36%42.98%
U.S. Federal Agencies - Callable 3.41%4.63%2.90%
Municipal Bonds - Coupon 2.38%3.43%4.65%
Certificates of Deposit - CDARS 8.06%8.13%7.11%
Certificates of Deposit - SLOC 12.66%12.34%0.00%
Commercial Paper - Discount 5.91%6.90%13.79%
Local Government Investment Pools 9.59%5.93%8.67%
Insured Cash Sweep Savings Deposits 4.11%3.76%13.07%
Demand Deposits 1.30%0.39%0.40%
Total 100.00%100.00%100.00%
CITY OF DENTON : QUARTERLY INVESTMENT REPORT
The portfolio is restricted to U.S. Treasuries and agency securities (maturing in less than five years); state and locally issued Texas municipal
bonds rated AA or better (maturing in less than three years); insured, collateralized, or standby letter of credit backed certificates of deposit
(maturing in less than three years); collateralized repurchase agreements (maturing in less than thirty days); commercial paper rated A-1/P-1 or
better (maturing in less than 270 days); and local government pools & SEC registered government money market mutual funds (weighted average
maturity of less than 60 days).
U.S. Treasuries ‐
Coupon
2.79%
U.S. Federal Agencies ‐
Coupon
49.79%
U.S. Federal Agencies ‐
Callable
3.41%
Municipal Bonds ‐
Coupon
2.38%
Certificates of
Deposit ‐SLOC
12.66%
Certificates of
Deposit ‐CDARS
8.06%Commercial Paper ‐
Discount
5.91%Local Government
Investment Pools…
Insured Cash Sweep
Savings Deposits
4.11%
Demand Deposits
1.30%
Current
3/31/2018
43
2nd Fiscal Quarter 2018 - March 31, 2018 Page 4
INVESTMENT POOL
Current 3 Months Ago 1 Year Ago
Summary By Issuer:3/31/2018 12/31/2017 3/31/2017
CDARS CDs 49,000,000$ 54,000,000$ 49,000,000$
LEGACYTEXAS BANK CDs*62,000,000 62,000,000 62,000,000
INDEPENDENT BANK CDs 15,000,000 20,000,000 33,000,000
U.S. TREASURY 16,958,860 53,988,660 44,302,001
FFCB 79,995,171 79,025,848 78,030,907
FHLB 121,008,039 130,105,703 115,098,377
FHLMC 47,921,604 47,914,577 44,098,875
FNMA 74,602,888 81,749,357 78,966,926
DALLAS, TX WTR & SWR REV BDS 10,000,000 10,000,000 10,000,000
TEXAS A&M UNIV REV BDS 4,500,000 4,500,000 9,504,897
LUBBOCK, TX GO REFUNDING BDS - - 3,303,686
UNIVERSITY OF HOUSTON, TX REV BDS - 3,300,517 5,094,680
MCKINNEY, TX GENERAL OBG BONDS - 5,013,267 1,193,502
TEXAS SCHOOL DIST GEN OBG BONDS - - 2,912,953
JP MORGAN SECURITIES LLC 10,984,992 25,911,014 -
TOYOTA MOTOR CREDIT CORP 14,979,723 14,919,698 26,940,183
GE CAPITAL TREASURY LLC - - 17,930,640
NESTLE FINANCE INTL LTD - - 14,911,600
ING (U.S.) FUNDING LLC 9,968,697 4,975,331 -
TEXSTAR 58,324,172 39,424,172 90,064,298
INSURED CASH SWEEP SAVINGS 25,000,000 25,000,000 -
WELLS FARGO DEMAND DEPOSITS 7,935,814 2,575,744 2,783,520
Total Book Value 608,179,960$ 664,403,888$ 689,137,045$
Objective:
Current 3 Months Ago 1 Year Ago
Summary By Issuer:3/31/2018 12/31/2017 3/31/2017
CDARS CDs 8.06%8.13%7.11%
LEGACYTEXAS BANK CDs*10.19%9.33%9.00%
INDEPENDENT BANK CDs 2.47%3.01%4.79%
U.S. TREASURY 2.79%8.13%6.44%
FFCB 13.15%11.89%11.32%
FHLB 19.90%19.58%16.70%
FHLMC 7.88%7.21%6.40%
FNMA 12.27%12.30%11.46%
DALLAS, TX WTR & SWR REV BDS 1.64%1.51%1.45%
TEXAS A&M UNIV REV BDS 0.74%0.68%1.39%
GE CAPITAL TREASURY LLC 0.00%0.00%2.58%
LUBBOCK, TX GO REFUNDING BDS 0.00%0.00%0.48%
UNIVERSITY OF HOUSTON, TX REV BDS 0.00%0.50%0.74%
MCKINNEY, TX GENERAL OBG BONDS 0.00%0.75%0.17%
TEXAS SCHOOL DIST GEN OBG BONDS 0.00%0.00%0.42%
JP MORGAN SECURITIES LLC 1.81%3.90%0.00%
TOYOTA MOTOR CREDIT CORP 2.46%2.25%3.91%
NESTLE FINANCE INTL LTD 0.00%0.00%2.17%
ING (U.S.) FUNDING LLC 1.64%0.75%0.00%
TEXSTAR 9.59%5.93%13.07%
INSURED CASH SWEEP SAVINGS 4.11%3.76%0.00%
WELLS FARGO DEMAND DEPOSITS 1.30%0.39%0.40%
Total 100.00%100.00%100.00%
*Formerly, ViewPoint Bank
CITY OF DENTON : QUARTERLY INVESTMENT REPORT
It is the policy of the City to diversify its investment portfolio by restricting investments in a single issuer/institution to no more than 35 percentof the portfolio's total book value and to those offeringrepurchase agreements, collateralized CDs (including standby letters of credit), and local or state of Texas municipal securities to no greater than 15 percent. The purpose of this requirement is to limitmarket and credit risk. Commercial paper issuers are further restricted by a 5 percent total portfolio limitation. There are no issuer limitations onU.S. Treasuries or FDIC insured products except as they
pertain to the overall 35% certificates of deposit and 15% savings deposit restrictions. Some investment types may be further limited.
CDARS CDs, 8.06%
LEGACYTEXAS BANK CDs, 10.19%
INDEPENDENT BANK CDs, 2.47%
U.S. TREASURY, 2.79%
FFCB, 13.15%
FHLB, 19.90%
FHLMC, 7.88%
FNMA, 12.27%
DALLAS, TX WTR & SWR REV BDS, 1.64%
TEXAS A&M UNIV REV BDS, 0.74%
JP MORGAN SECURITIES LLC, 1.81%
TOYOTA MOTOR CREDIT CORP, 2.46%
ING (U.S.) FUNDING LLC, 1.64%
INSURED CASH SWEEP SAVINGS, 4.11%
TEXSTAR, 9.59%
WF DEMAND DEPOSITS, 1.30%
Current
3/31/2018
44
2nd Fiscal Quarter 2018 - March 31, 2018 Page 5
INVESTMENT POOL
Current 3 Months Ago 1 Year Ago
Maturity Time Frame:3/31/2018 12/31/2017 3/31/2017
00-03 Months 191,759,986$ 182,299,916$ 155,847,818$
03-06 Months 68,000,000 100,500,000 82,060,000
06-12 Months 109,000,000 87,000,000 135,300,000
12-24 Months 208,000,000 200,000,000 230,500,000
24 Months & Over 31,756,000 94,756,000 85,000,000
Total Par Value 608,515,986$ 664,555,916$ 688,707,818$
Objective:
Current 3 Months Ago 1 Year Ago
Maturity Time Frame:3/31/2018 12/31/2017 3/31/2017
00-03 Months 31.52%27.43%22.63%
03-06 Months 11.17%15.12%11.92%
06-12 Months 17.91%13.09%19.65%
12-24 Months 34.18%30.10%33.46%
24 Months & Over 5.22%14.26%12.34%
Total 100.00%100.00%100.00%
CITY OF DENTON : QUARTERLY INVESTMENT REPORT
The risk of market price volatility is minimized through maturity diversification. Investment maturities are staggered to provide cash flows
based on the anticipated needs of the City. Liquidity is achieved by matching investment maturities with forecasted cash disbursements
and by investing in securities with active secondary markets. Short-term local government investment pools and government money
market mutual funds help to provide daily liquidity and may be utilized as a competitive alternative to other fixed income investments.
$0
$50,000,000
$100,000,000
$150,000,000
$200,000,000
$250,000,000
$300,000,000
$350,000,000
$400,000,000
$450,000,000
$500,000,000
$550,000,000
$600,000,000
$650,000,000
$700,000,000
$750,000,000
Current 3 Months Ago 1 Year Ago
00-06 Months 06-12 Months 12-24 Months 24 Months & Over
45
2nd Fiscal Quarter 2018 - March 31, 2018 Page 6
ECONOMIC SUMMARY
Interest Rate History
Source: U.S. Federal Reserve Statistical
Release (H.15)
Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15
Market Sector:AvgAvgAvgAvgAvgAvgAvgAvgAvgAvgAvgAvg
Fed Funds (effective)0.16% 0.14% 0.09% 0.08% 0.09% 0.08% 0.10% 0.09%0.12% 0.11% 0.13% 0.14%
3-Month U.S. T-Bill 0.07% 0.09% 0.05% 0.02% 0.07% 0.05% 0.04% 0.02%0.03% 0.03% 0.02% 0.02%
2-Year U.S. T-Note 0.26% 0.26% 0.33% 0.40% 0.34% 0.40% 0.45% 0.57%0.64% 0.64% 0.69% 0.71%
Portfolio Benchmark*0.18% 0.18% 0.16% 0.15% 0.13% 0.13% 0.12% 0.12%0.12% 0.15% 0.18% 0.24%
Portfolio Yield 0.52% 0.50% 0.48% 0.49%0.50% 0.49% 0.49% 0.51% 0.55% 0.57% 0.57% 0.65%
Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18
Market Sector:AvgAvgAvgAvgAvgAvgAvgAvgAvgAvgAvgAvg
Fed Funds (effective)0.24% 0.36% 0.38% 0.40% 0.54% 0.79% 1.04% 1.15% 1.30% 1.67%
3-Month U.S. T-Bill 0.23% 0.30% 0.27% 0.29% 0.51% 0.75% 1.00% 1.05% 1.32% 1.71%
2-Year U.S. T-Note 0.98% 0.88% 0.73% 0.77% 1.20% 1.31% 1.34% 1.38% 1.84% 2.27%
Portfolio Benchmark*0.32% 0.41% 0.49% 0.54% 0.61% 0.69% 0.83% 1.00% 1.20% 1.46%
Portfolio Yield 0.72% 0.79% 0.81%0.90% 0.95% 1.07% 1.16% 1.25% 1.29% 1.42%
*Twelve month moving average of a one year
U.S. T-bill yield
Fiscal Year:
2017-2018
2016-2017
2015-2016
2014-2015
2013-2014
2012-2013
QUARTERLY COMMENTARY
March 31, 2018
Source: First Southwest Asset Management
Economic Summary & TexSTAR Monthly
Newsletter
CITY OF DENTON : QUARTERLY INVESTMENT REPORT
Fiscal Year 2012-2013 Fiscal Year 2013-2014 Fiscal Year 2014-2015
The second quarter of FY18-19 was marked by rising interest rates. Jerome Powell became the new chairman for the Federal
Reserve. The Federal Reserve raised the Fed Fund rate by 25 basis points on March 21, 2018. This brings the fed funds
targeted range to 1.50 - 1.75%. Analysts are debating if there will be 2 or 3 more rate hikes in 2018. At this time the yield curve
shows 2-year yields at 2.43%, while the 10-year yield is 2.92%. This 49 basis point spread is a big change from six months ago
at 79 basis points. Concerns of an inverted yield curve have risen as this has historically been an indicator of a future economic
downturn. Another major event occurred when President Trump announced $50 billion in tariffs on Chinese goods on March 22,
2018.
Fiscal Year to Date Earnings
3 Months 6 Months 9 Months 12 Months
849,368$
613,879$
568,825$
1,228,059$
1,121,491$
1,177,337$
2,695,211$
2,138,420$ -$
1,874,847$
Oct - Dec Oct - Mar Oct - Jun Oct - Sep
Fiscal Year 2015-2016 Fiscal Year 2016-2017 Fiscal Year 2017-2018
2,298,785$
2,276,341$
4,734,315$ 6,999,226$
3,961,971$
1,175,753$
612,750$
2,763,136$
3,771,703$ -$
2,743,856$ 1,771,205$
1,680,154$
1,703,496$
0.00%
1.00%
2.00%
3.00%
Dec-
12
Mar-
13
Jun-
13
Sep-
13
Dec-
13
Mar-
14
Jun-
14
Sep-
14
Dec-
14
Mar-
15
Jun-
15
Sep-
15
Dec-
15
Mar-
16
Jun-
16
Sep-
16
Dec-
16
Mar-
17
Jun-
17
Sep-
17
Dec-
17
Mar-
18
Jun-
18
Sep-
18
Fed Funds 3-Month T-Bill 2-Year T-Note Portfolio Yield Portfolio Benchmark*
FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16 FY 2016-17 FY 2017-18
46
Days toMaturityPage 1Par ValueBook ValueMaturityDateStatedRateMarket ValueMarch 31, 2018Portfolio Details - InvestmentsAverageBalanceIssuerPortfolio ManagementMonthly ReportsYTM365 CUSIP Investment #PurchaseDateTreasury Securities - Coupon228U.S. TREASURY39157,000,000.00 7,002,751.86 11/15/20181.25001/27/2017 6,966,911.00 1.186912828M64320U.S. TREASURY394810,000,000.00 9,956,108.42 02/15/20190.75006/07/2017 9,882,810.00 1.258912828P5316,958,860.281.22816,849,721.0017,000,000.0016,956,983.90Subtotal and Average282Federal Agency Issues - Coupon166FFCB38964,000,000.00 3,999,447.80 09/14/20180.87506/27/2016 3,981,696.00 0.9063133EGFQ3187FFCB38974,000,000.00 4,001,160.68 10/05/20180.96006/27/2016 3,980,836.00 0.9023133EFX69136FFCB390810,000,000.00 9,997,022.22 08/15/20180.80008/15/2016 9,962,890.00 0.8813133EGQY43FFCB39228,000,000.00 8,000,033.13 04/04/20181.04001/31/2017 7,999,760.00 0.9903133EG3A1318FFCB393125,000,000.00 24,992,741.67 02/13/20191.20002/13/2017 24,809,450.00 1.2343133EG6Z3544FFCB39328,000,000.008,002,333.1109/27/20191.55002/16/20177,916,320.001.5303133EG2D6424FFCB39375,000,000.005,022,691.5605/30/20191.75002/22/20174,974,180.001.3523133EDPK2736FFCB39596,000,000.006,007,257.4704/06/20201.60007/25/20175,911,128.001.5383133EHEZ2768FFCB39765,000,000.004,972,886.5405/08/20202.15003/23/20184,976,280.002.4163133EJCA5136FHLB39065,000,000.004,998,592.8208/15/20180.80007/27/20164,978,445.000.8763130A8TF068FHLB391724,000,000.0024,007,512.7906/08/20181.25001/30/201723,976,336.001.080313379DT3212FHLB39187,000,000.006,999,396.2210/30/20181.15001/30/20176,964,930.001.1653130AARE0128FHLB39275,000,000.004,991,537.3308/07/20180.62502/02/20174,976,700.001.1143130A8PK3593FHLB39337,000,000.006,981,812.7411/15/20191.37502/16/20176,900,432.001.5393130AA3R7621FHLB39345,000,000.005,064,930.9712/13/20192.37502/16/20175,004,170.001.5903130A0JR2688FHLB393920,000,000.0019,998,594.9102/18/20201.65003/08/201719,742,880.001.6543130AAXU7688FHLB394515,000,000.0014,991,972.3302/18/20201.40004/26/201714,738,700.001.4293130ABAA4688FHLB395115,000,000.0015,000,000.0002/18/20201.50006/29/201714,766,075.001.5003130ABM29712FHLB39588,000,000.008,052,842.5303/13/20201.87507/25/20177,923,712.001.528313378J77586FHLB39735,000,000.004,951,273.5611/08/20191.45001/25/20184,940,765.002.0723130AC2Q6341FHLB39755,000,000.004,969,572.3203/08/20191.50003/23/20184,970,190.002.1603133782M289FHLMC38945,000,000.005,000,000.0006/29/20181.00006/29/20164,989,595.000.9853134G9UY1170FHLMC39258,000,000.008,004,559.7309/18/20181.30002/02/20177,977,200.001.1753134G7TZ4117FHLMC39289,000,000.008,993,287.1807/27/20180.85002/02/20178,968,230.001.0843134G92H9379FHLMC39355,000,000.004,990,662.1004/15/20191.12502/22/20174,946,745.001.3083137EADZ9333FHLMC39385,000,000.005,000,000.0002/28/20191.37502/28/20174,964,735.001.3753134GA6H2761FHLMC39605,000,000.004,983,094.8805/01/20201.37507/25/20174,902,555.001.5413137EADR7481FNMA39035,000,000.005,000,000.0007/26/20191.00007/26/20164,920,635.001.0003136G3XJ9331FNMA390410,000,000.0010,021,952.0502/26/20191.00007/07/20169,895,200.000.7543135G0J53332FNMA39093,000,000.003,018,873.1102/27/20191.70008/30/20162,987,115.000.9953136FTS67331FNMA391010,000,000.0010,002,212.6102/26/20191.00008/30/20169,895,200.000.9753135G0J5350FNMA39235,000,000.004,998,962.7705/21/20180.87501/31/20174,994,190.001.0263135G0WJ8170FNMA39262,000,000.002,006,640.1009/18/20181.87502/02/20171,998,904.001.1503135G0YM9Portfolio CITYNL! APData Updated: SET_MO: 05/02/2018 10:10Run Date: 05/02/2018 - 10:10PM (PRF_PM2) 7.3.0Report Ver. 7.3.547
Days toMaturityPage 2Par ValueBook ValueMaturityDateStatedRateMarket ValueMarch 31, 2018Portfolio Details - InvestmentsAverageBalanceIssuerPortfolio ManagementMonthly ReportsYTM365 CUSIP Investment #PurchaseDateFederal Agency Issues - Coupon488FNMA393010,000,000.00 9,937,911.19 08/02/20190.87502/08/2017 9,820,160.00 1.3493135G0N33698FNMA39365,000,000.00 5,000,000.00 02/28/20201.70002/28/2017 4,942,030.00 1.7003136G4MA8698FNMA39425,000,000.00 4,991,256.96 02/28/20201.50003/29/2017 4,924,530.00 1.5943135G0T29514FNMA39505,000,000.00 4,969,988.66 08/28/20191.00006/14/2017 4,917,040.00 1.4343135G0P49571FNMA397110,000,000.00 9,848,181.73 10/24/20191.00001/08/2018 9,802,660.00 1.9933135G0R39302,771,195.771.330300,242,599.00303,000,000.00305,840,323.48Subtotal and Average405Federal Agency Issues - Callable438FFCB38955,000,000.00 4,999,596.64 06/13/20191.18006/22/2016 4,938,995.00 1.1873133EGEF8820FHLMC39536,000,000.00 6,000,000.00 06/29/20201.62506/29/2017 5,897,340.00 1.6253134GBVD1880FHLMC39654,950,000.00 4,950,000.00 08/28/20201.62508/29/2017 4,840,535.70 1.6253134GBD82862FNMA39644,806,000.00 4,806,909.05 08/10/20201.70008/29/2017 4,730,810.13 1.6823136G4NZ220,756,505.691.53320,407,680.8320,756,000.0020,756,591.47Subtotal and Average752Municipal Bonds - Coupon548DALLAS, TX WTR & SWR REV BDS38994,000,000.00 4,000,000.00 10/01/20191.21707/07/2016 3,929,400.00 1.21723542JBE4183DALLAS, TX WTR & SWR REV BDS39006,000,000.00 6,000,000.00 10/01/20180.98507/07/2016 5,967,600.00 0.98523542JBD644TX A & M UNIV REV BD38863,500,000.00 3,500,000.00 05/15/20181.22204/12/2016 3,496,290.00 1.22288213ADK8409TX A & M UNIV REV BD39021,000,000.00 1,000,000.00 05/15/20191.00907/20/2016 985,960.00 1.00988213AFU414,500,000.001.10814,379,250.0014,500,000.0014,500,000.00Subtotal and Average266CDs - CDARS39CD - CDARS38907,000,000.00 7,000,000.00 05/10/20181.31705/12/2016 7,000,000.00 1.317SYS3890312CD - CDARS39297,000,000.00 7,000,000.00 02/07/20191.67702/09/2017 7,000,000.00 1.677SYS3929347CD - CDARS394010,000,000.0010,000,000.0003/14/20191.62603/16/201710,000,000.001.626SYS3940473CD - CDARS395510,000,000.0010,000,000.0007/18/20191.69807/20/201710,000,000.001.698SYS3955494CD - CDARS396110,000,000.0010,000,000.0008/08/20191.69808/10/201710,000,000.001.698SYS3961529CD - CDARS39665,000,000.005,000,000.0009/12/20191.52309/14/20175,000,000.001.523SYS396649,000,000.001.60849,000,000.0049,000,000.0049,000,000.00Subtotal and Average372CDs - SLOC375CD - INDEPENDENT BANK394410,000,000.00 10,000,000.00 04/11/20191.62304/13/2017 10,000,000.00 1.623SYS3944676CD - INDEPENDENT BANK39745,000,000.005,000,000.0002/06/20202.29502/08/20185,000,000.002.295SYS39744CD - LEGACYTEXAS BANK38877,000,000.007,000,000.0004/05/20181.30004/07/20167,000,000.001.300SYS388774CD - LEGACYTEXAS BANK389210,000,000.0010,000,000.0006/14/20181.38006/16/201610,000,000.001.380SYS3892109CD - LEGACYTEXAS BANK390510,000,000.0010,000,000.0007/19/20181.35007/21/201610,000,000.001.350SYS3905130CD - LEGACYTEXAS BANK390710,000,000.0010,000,000.0008/09/20181.32008/11/201610,000,000.001.320SYS3907403CD - LEGACYTEXAS BANK394610,000,000.0010,000,000.0005/09/20191.67705/11/201710,000,000.001.677SYS3946Portfolio CITYNL! APData Updated: SET_MO: 05/02/2018 10:10Run Date: 05/02/2018 - 10:10PM (PRF_PM2) 7.3.048
Days toMaturityPage 3Par ValueBook ValueMaturityDateStatedRateMarket ValueMarch 31, 2018Portfolio Details - InvestmentsAverageBalanceIssuerPortfolio ManagementMonthly ReportsYTM365 CUSIP Investment #PurchaseDateCDs - SLOC438CD - LEGACYTEXAS BANK394915,000,000.00 15,000,000.00 06/13/20191.67606/15/2017 15,000,000.00 1.676SYS394977,000,000.001.54877,000,000.0077,000,000.0077,000,000.00Subtotal and Average271Commercial Paper Disc. - Amortizing17ING (U.S.) FUNDING LLC39695,000,000.00 4,996,080.56 04/18/20181.66012/20/2017 4,994,795.00 1.6924497W1DJ2106ING (U.S.) FUNDING LLC39725,000,000.004,972,616.6607/16/20181.86001/18/20184,965,815.001.9034497W1GG517JP MORGAN SECURITIES LLC39635,000,000.004,996,505.5604/18/20181.48008/23/20174,994,795.001.54246640QDJ744JP MORGAN SECURITIES LLC39676,000,000.005,988,486.6705/15/20181.57010/17/20175,984,088.001.62546640QEF436TOYOTA MOTOR CREDIT39687,000,000.006,989,430.0005/07/20181.51011/15/20176,985,783.001.54289233HE7526TOYOTA MOTOR CREDIT39708,000,000.007,990,293.3304/27/20181.68012/28/20177,988,248.001.71389233HDT835,933,412.781.66535,913,524.0036,000,000.0038,166,536.21Subtotal and Average40Local Govt Investment Pools1LOCAL GOVT INV POOL - TEXSTAR364158,324,171.85 58,324,171.85 1.49058,324,171.85 1.490SYS364158,324,171.851.49058,324,171.8558,324,171.8562,275,784.75Subtotal and Average1Insured Cash Sweep Savings Deposits1INSURED CASH SWEEP SAVINGS396225,000,000.00 25,000,000.00 1.55025,000,000.00 1.550SYS396225,000,000.001.55025,000,000.0025,000,000.0025,000,000.00Subtotal and Average1Demand Deposits1DEMAND DEPOSITS - WELLS FARGO37067,935,813.73 7,935,813.73 0.8007,935,813.73 0.800SYS37067,935,813.730.8007,935,813.737,935,813.732,679,736.97Subtotal and Average11.416612,175,956.78 608,515,985.58309605,052,760.41 608,179,960.10Total and AveragePortfolio CITYNL! APData Updated: SET_MO: 05/02/2018 10:10Run Date: 05/02/2018 - 10:10PM (PRF_PM2) 7.3.049
Days toMaturityPage 4Par ValueBook ValueStatedRateMarket ValueMarch 31, 2018Portfolio Details - CashAverageBalanceIssuerPortfolio ManagementMonthly ReportsYTM365 CUSIP Investment #PurchaseDate0.001.416612,175,956.78 608,515,985.583090Average Balance605,052,760.41 608,179,960.10Total Cash and InvestmentsPortfolio CITYNL! APData Updated: SET_MO: 05/02/2018 10:10Run Date: 05/02/2018 - 10:10PM (PRF_PM2) 7.3.050
Street Reconstruction by City of Denton Street Department
51
Section 5
City of Denton
Quarterly Financial Report
March 2018
PERFORMANCE REPORT
52
The City of Denton uses a Strategic Plan as a roadmap to achieve long-term goals and objectives that
capture the City’s Vision, Mission, and Value statements. The first Strategic Plan was formally
approved by the City Council in April 2011, and it has been updated periodically since that time. Over
the past year, the City has partnered with the Bloomberg What Works Cities initiative to refine our
strategic outcomes and identify measurable ways to mark our progress. The City Council approved
the FY 2017-18 Strategic Plan and associated performance measures on September 19, 2017.
The Strategic Plan serves as the basis for resource allocation decisions that are used in the
development of the FY 2017-18 Budget. The Strategic Plan is organized into five Key Focus Areas
(KFAs) and major goals associated with each KFA are also identified below.
Key Focus Area 1: Organizational Excellence
Goal 1.1 Manage financial resources in a responsible manner.
Goal 1.2 Develop a high-performance work force.
Goal 1.3 Promote effective internal and external communication.
Goal 1.4 Achieve high level of customer satisfaction.
Goal 1.5 Utilize technology to enhance efficiency and productivity.
Goal 1.6 Collaborate with local, regional, state, and federal partners.
Key Focus Area 2: Public Infrastructure
Goal 2.1 Optimize resources to improve quality of City roadways.
Goal 2.2 Seek solutions to mobility demands and enhance connectivity.
Goal 2.3 Promote superior utility services and facilities.
Goal 2.4 Manage drainage infrastructure.
Goal 2.5 Develop Capital Improvement Program (CIP) based on community needs.
Key Focus Area 3: Economic Development
Goal 3.1 Develop targeted policies and incentives to achieve desired economic growth.
Goal 3.2 Make Denton a destination for visitors.
Goal 3.3 Promote a business-friendly environment.
Goal 3.4 Encourage development, redevelopment, recruitment, and retention.
Key Focus Area 4: Safe, Liveable and Family Friendly Community
Goal 4.1 Enhance public safety in the community.
Goal 4.2 Seek clean and healthy neighborhoods in Denton.
Goal 4.3 Provide quality, diverse, and accessible neighborhood services for the community.
Goal 4.4 Provide and support outstanding leisure, cultural, and educational opportunities.
Goal 4.5 Provide support to citizens in need through social service agencies and programs.
Key Focus Area 5: Sustainable & Environmental Stewardship
Goal 5.1 Manage Denton’s water resources.
Goal 5.2 Improve air quality and greenhouse gas management.
Goal 5.3 Improve energy efficiency and conservation.
Goal 5.4 Manage land use and preserve open/natural spaces.
Goal 5.5 Provide alternative modes of transportation.
Goal 5.6 Promote sustainable materials resource management.
Goal 5.7 Encourage local food production.
53
The matrix below organizes the Key Focus Areas (KFAs) by select service areas in the organization.
While every department has some level of responsibility for each KFA, the matrix is intended to only
highlight the primary departments responsible for each KFA.
SERVICE AREA KFA 1 KFA 2 KFA 3 KFA 4 KFA 5
UTILITIES
Electric
Water
Wastewater
Solid Waste
INTERNAL SERVICES
Technology Services
Materials Management
Fleet
Risk
NEIGHBORHOOD SERVICES
Building Inspection
Community Improvement Services
Libraries
Parks and Recreation
Planning
Gas Well Operations
Community Development
PUBLIC SAFETY
Animal Services
Fire
Police
Municipal Court
TRANSPORTATION
Airport
Streets
Traffic/Transportation
ADMINISTRATIVE SERVICES
City Manager’s Office
Economic Development
Facilities Management
Finance
Human Resources
Internal Audit
Legal
Public Communications
Key Focus Area 1: Organizational Excellence
Key Focus Area 2: Public Infrastructure
Key Focus Area 3: Economic Development
Key Focus Area 4: Safe, Liveable and Family-Friendly Community
Key Focus Area 5: Sustainable & Environmental Stewardship
54
STRATEGIC PLAN
PERFORMANCE REPORT 20 17-18
City of Denton, Texas
A visual representation of performance measures can be found on the City of Denton website:
http://data.cityofdenton.com/showcase/strategic-measures
55
STRATEGIC PLAN PERFORMANCE DASHBOARD 2017-18
KEY FOCUS AREA DEPARTMENT STRATEGIC PLAN PERFORMANCE MEASURES TARGET 2ND QTR
PERCENTAGE OF FIRST CONTACT RESOLUTION FOR CUSTOMERS 85%97.2%
PERCENTAGE OF BILLING ACURACY 99%99.9%
PERCENTAGE OF PAYMENTS PROCESSED VIA ONLINE SELF-SERVICE 55%62.3%
PERCENTAGE OF CITIZENS RATING THE CITY WEBSITE AS A MAJOR SOURCE OF INFORMATION 65%60%
NUMBER OF FOLLOWERS ACROSS ALL CITY SOCIAL MEDIA SITES 165,000 203,962
PERCENTAGE OF ACTUAL GENERAL FUND REVENUE COMPARED TO BUDGETED REVENUE 100%101.4%
PERCENTAGE OF ACTUAL GENERAL FUND EXPENDITURES AS COMPARED TO BUDGETED
EXPENDITURES <100%91.9%
ANNUAL RATE OF INVESTMENT RETURN 1.25%1.41%
ENGINEERING PERCENTAGE OF BOND FUNDED PROJECTS COMPLETED 85%10%
LANE MILES OF ASPHALT ROADWAY RECONSTRUCTED 12 5.46
LANE MILES OF ASPHALT ROADWAY OVERLAID 15 6.36
LANE MILES OF ASPHALT ROADWAY MICRO-SEALED 45 0
MILES OF SIDEWALK RECONSTRUCTED 2 2.85
AIRPORT NUMBER OF ACRES OF AIRPORT LAND NEWLY LEASED 7 0
NUMBER OF RFP'S RETURUNED IN TARGET INDUSTRY SECTORS 20 11
NUMBER OF WORKFORCE DEVELOPMENT ACTIVITIES OR GRANTS FACILITATED 12 31
NUMBER OF DOWNTOWN PROPERTIES REDEVELOPED 6 6
NUMBER OF BUSINESS RETENTION VISITS IN THE DOWNTOWN AREA 24 7
NUMBER OF BUSINESS RETENTION VISITS IN AREAS OTHER THAN DOWNTOWN 48 17
POLICE PERCENT OF RESOLVED NEIGHBORHOOD COMPLAINTS 75%100%
PERCENT OF ACTIVE STRUCTURE FIRES RESPONDED TO IN FIVE MINUTES OR LESS (NFPA 1710
STANDARD IS 90 PERCENT OR LESS THAN FOUR MINUTES)90%40.0%
AVERAGE UNIT TURN-OUT TIME (TIME FROM WHEN A 911 DISPATCH IS RECEIVED TO WHEN
UNITS ARE EN ROUTE)1.20 1.14
PARKS NUMBER OF SPECIAL EVENTS HOSTED BY THE PARKS & RECREATION DEPARTMENT 8 5
NUMBER OF INDIVIDUALS REACHED BY THE DENTON PUBLIC LIBRARY "DPL2GO" OUTREACH
SERVICE 5,000 7,853
NUMBER OF "DPL2GO" OUTREACH EVENTS 60 77
SOLID WASTE POUNDS OF WASTE DISPOSED PER CAPITA 1,900 864
MILES OF ON-STREET BIKE INFRASTRUCTURE, SUCH AS BIKE LANES AND SHARROWS, ADDED
DURING FISCAL YEAR 2017-18 7 2.3
NUMBER OF TRANSPORTATION SAFETY EDUCATIONAL OPPORTUNITIES AND EVENTS 11 3
NUMBER OF SUSTAINABILITY RELATED WORKSHOPS HOSTED BY THE CITY 35 18
PERCENT OF GREENSENSE REBATE FUNDING EXPENDED 100%16%
ENGINEERING
ENVIRONMENTAL
SERVICES
KFA 5: SUSTAINABLE
AND EVIRONMENTAL
STEWARDSHIP
FINANCE
STREETS
KFA 4: SAFE, LIVEABLE,
AND FAMILY-FRIENDLY
COMMUNITY
FIRE
LIBRARY
KFA 3: ECONOMIC
DEVELOPMENT
KFA 1:
ORGANIZATIONAL
EXCELLENCE
CUSTOMER SERVICE
PUBLIC
COMMUNICATIONS
KFA 2: PUBLIC
INFRASTRUCTURE
ECONOMIC
DEVELOPMENT
56
STRATEGIC PLAN
WORK PLAN REPORT 20 17-18
City of Denton, Texas
57
STRATEGIC PLAN - WORK PLAN DASHBOARD 2017-18
KEY FOCUS AREA DEPARTMENT STRATEGIC PLAN WORK PLANS TARGET
DATE 2nd QUARTER
Implement online payment and citizen service request systems Dec 2017 Implementation has begun and the application launch is
expected in mid-June.
Launch a bi-monthly newsletter for citizens and stakeholders Dec 2017
The City has continued production of the bimonthly Resident
Update. Past issues can be found at
https://www.cityofdenton.com/en-us/stay-updated under
Important Documents.
Expand open data initiatives and improve citizen access to information Sep 2018 There are currently 171 total datasets available at
http://data.cityofdenton.com.
Hold regular performance management meetings with departments and
executive team Sep 2018
Developing an alternative strategy to identify performance
measures that will provide greater clarity into the City's various
operations and be a more effective tool for management staff.
Offer key indicators of the City’s performance through an online
dashboard Dec 2017
A dashboard of the City's performance related to strategic plan
measures is located at
http://data.cityofdenton.com/base/strategic-performance-
measures
Evaluate purchasing and contract management policies and procedures Jun 2018 Staff has been working to update these policies and procedures.
A draft policy is expected to go before council during Quarter 2.
Complete 80% of construction on the new West Parallel Runway Sep 2018 Environmental Assessment approval delayed, approval
anticipated in Q3.
Complete the Airport Business Plan Update Sep 2018 Compliance review completed. Development of Airport Guiding
Documents to begin in Q3.
Traffic Engage a consultant to assist with review of railroad crossings in the city,
as well as possible Quite Zones Sep 2018
Plans, estimate, design and agreement have been proposed and
requested from UPRR for the Downtown segment. The
southern section information will follow this summer.
Complete 85% of scheduled street improvement projects for Fiscal Year
2017-18 Sep 2018 Completed *31% of the planned projects. *Cumulative Total
Complete the 2012 and 2014 bond programs for street improvements Sep 2018
Second quarter production was lower than anticipate do to
several rain events. The Street Department completed 12 Bond
segments during Second Quarter and 10 segments in the first
month of the Third Quarter.
Econ Development Actively recruit prospects from target industries, as identified by the
Economic Development Partnership Board Sep 2018
Economic Development returned 9 request for proposal
responses in Q2, which brings the total to 11, or 55% of the
FY17-18 target.
Dec 2017
The Department continues to improve communication
applicants by building a relationship early and keeping the
applicant in the loop throughout the development review
process. Projects continue to be reviewed and comments are
sent out within the published timeline. In the event when
comments require clarification, staff responds in a timely
matter and will coordinate a solutions meeting.
KFA 2: PUBLIC
INFRASTRUCTURE
Implement recommendations to improve the development review and
building inspections processes
City Manager Office
KFA 1:
ORGANIZATIONAL
EXCELLENCE
Development
Services
KFA 3: ECONOMIC
DEVELOPMENT
Airport
Capital Projects
58
STRATEGIC PLAN - WORK PLAN DASHBOARD 2017-18
KEY FOCUS AREA DEPARTMENT STRATEGIC PLAN WORK PLANS TARGET
DATE 2nd QUARTER
Complete the Denton Code 2030 Update June 2018
During this Quarter the Development Services started their
Public Open Houses to receive feedback on the Denton
Development Code Update Public Draft and Draft Zoning Map
from property owners, business owners, and other
stakeholders. Staff has also started meeting and presenting the
Public Draft and Draft Zoning Map to the Development Code
Review Committee (DCRC) for their review and to seek their
Complete updates to building standards and design policies under the
City’s Site Design Criteria Manual and related documents June 2018
Updates to the Water, Wastewater, Storm Drainage and
Transportation Criteria Manuals have been completed and
formally adopted. Updates to the Water, WW, Storm Drainage
and Transportation sections of the DDC have been drafted and
issued for public review and comment. ETA for adoption is
September 2018.
Complete remodel of the Public Safety Communications Center Sep 2018
The plans for the remodel are complete. Purchasing should
have a RFQ out soon. The construction start date should be in
August 2018.
Purchase and implement a new Computer Aided Dispatch (CAD) system
to upgrade technology and improve public safety response, data and
records
June 2018 Police, Fire and Technology Services are currently meeting to
score the proposals.
Implement an Automatic Fire Station Alerting System Sep 2018
Station Alerting is a multi-year strategy with US Digital Designs.
Equipment has been recevied for Stations: 1,4,5,6,and 8.
Installation is currently in process, and funding for Station 7 will
be a supplemental funding request for the FY 18-19 Budget.
Add on Fire Medic unit in the Northeast Denton area June 2018 The Medic unit at Station 4 is in service.
Complete construction of Fire Station #4 March 2018
The construction is in the final phase of completion, and will be
open in May 2018, additionally a station dedication is planned
for June 2018.
Use GIS mapping to determine population distribution in relation to City
recreational amenities Sep 2018 Staff is working with GIS to provide maps.
Implement recommendations from Denton Parks playground
replacement plan Sep 2018
Bids were accepted on 4/17/18. Playground designs are under
final review. Scheduled completion is August 2018.
Community
Development
Continue partnership with the Denton County Homeless Leadership
team to collect and analyze data on housing and service needs Sep 2018
Mayor and Council member and CD staff contributed in
partnership in Denton County Homeless Leadership Team (HLT)
meetings and planning sessions. City Staff contributed in
partnership a minimum of 108 hours through HLT Housing and
Data Workgroups meetings and activities to collect and analyze
data on housing and service needs. The City reimbursed $8,050
for Homeless Management Information System database
supporting 22 licenses for 10 agencies, up three from the
previous quarter.
Parks
KFA 4: SAFE, LIVEABLE,
AND FAMILY-FRIENDLY
COMMUNITY
Public Safety
Fire
Development
Services
KFA 3: ECONOMIC
DEVELOPMENT
59
STRATEGIC PLAN - WORK PLAN DASHBOARD 2017-18
KEY FOCUS AREA DEPARTMENT STRATEGIC PLAN WORK PLANS TARGET
DATE 2nd QUARTER
Develop a comprehensive public education program to educate
residents on code requirements
Sep 2018
During this Quarter the Development Services started their
Public Open Houses to receive feedback on the Denton
Development Code Update Public Draft and Draft Zoning Map
from property owners, business owners, and other
stakeholders. The Department continues to refine and finalize
the comprehensive public education program.
Engage homeowner's associations and neighborhod groups to improve
neighborhoods through code compliance Sep 2018
The Department has hosted and attend numerous special
events neighborhood meetings engaging with the community,
sharing information on neighborhood empowerment programs
and providing details and seeking feedback on the Denton
Development Code Update and Draft Zoning Map.
Electric Complete construction of the Denton Engergy Center Sep 2018
At the end of the second quarter, the Denton Energy Center
(DEC) is approximately 98% complete. The facility has entered
the performance testing phase of the project, which is
scheduled to continue through spring 2018. Approximately
79% of allocated project funds have been expended. The target
date for commercial operations remains on or before July 1st
with ERCOT approval. All of the plant systems have been fully
commissioned, and the plant has demonstrated the ability to
generate 225 MW of electricity. Performance and emissions
testing continues through May 2018.
Solid Waste Complete construction of Cell 3 to expand capacity at the landfill Sep 2018
The construction of the new landfill cell is complete. Staff is
awaiting approval from TCEQ before initiating waste operations
in the cell.
Environmental
Services Engage the community and update the City's 2012 Sustainability Plan March 2018
Staff has conducted an online survey and held community
meetings to gather input from citizens. Feedback has been
compiled and will be presented to community for review next
quarter. Community and Internal stakeholder feedback will be
presented to the Committee on the Environment this summer
and the new plan will be drafted accordingly.
Electric Review the City's renewable energy portfolio and present options to
increase renewable energy Dec 2017
DME continues moving forward with the City Council ’s
approval by resolution, of the Denton Renewable Resource Plan
‘DRRP’. With existing portfolio resources of solar and wind,
ongoing review of RFP responses with a view to an award and
future solicitations identified in DRRP, Denton’s renewable
portfolio continues advancing towards its accelerated goal of
100% by the 2020 timeframe.
Development
Services
KFA 5: SUSTAINABLE
AND EVIRONMENTAL
STEWARDSHIP
KFA 4: SAFE, LIVEABLE,
AND FAMILY-FRIENDLY
COMMUNITY
60
City Hall Fountain
61