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<br />Paris Economic Development Corporation
<br />(A Component Unit of the City of Paris, Texas)
<br />Notes to Financial Statements (Continued)
<br />September 30, 2006
<br />
<br />Note 6: Notes and Bonds Payable (Continued)
<br />
<br />Sales and Use Taxes (one-quarter of one percent) levied by the City of Paris, Texas, within its
<br />boundaries under the Development Corporation Act of 1979, are pledged for payment of bonds and
<br />interest. The resolution authorizing the issuance of the bonds requires that monthly deposits be made
<br />to the Debt Service Fund in an amount sufficient to pay the next maturing bonds and interest.
<br />
<br />A Reserve Fund is required to be maintained with a balance of at least $388,708, the average annual
<br />principal and interest requirements of the bonds. At September 30, 2006, the balances in the Debt
<br />Service Fund and Reserve Fund are $56,218 and $428,807, respectively,
<br />
<br />Debt Service requirements related to these bonds and the note are as follows:
<br />
<br />Year Ending Bonded Debt Requirements Note Payable Note Payable
<br />September 30, Principal Interest Principal Interest Principal Interest Total
<br />2007 $ 180,000 $ 207,436 $ 209,299 $ 10,340 $ 197,023 $ 29,477 $ 833,575
<br />2008 190,000 193,486 162,061 2,549 207,058 19,442 774,596
<br />2009 200,000 178,761 217,733 8,767 605,261
<br />2010 215,000 166,261 56,038 473 437,772
<br />2011 230,000 152,716 382,716
<br />2012-2016 1,410,000 520,261 1,930,261
<br />2017-2018 705,000 70,888 775,888
<br /> $ 3,130,000 $ 1,489,809 $ 371,360 $ 12,889 $ 677,852 $ 58,159 $ 5,740,069
<br />
<br />I A summary oflong-term liability transactions for the year ended September 30, 2006 follows:
<br /> Balance Balance
<br /> September 30, September 30,
<br /> 2005 Additions Reductions 2006
<br />I Bonded Debt $ 3,295,000 $ $ 165,000 $ 3,130,000
<br />Note Payable 573,083 201,723 371,360
<br />Note Payable 865,384 187,532 677,852
<br /> Total $ 4,733,467 $ $ 554,255 $ 4,179,212
<br />
<br />Note 7: Commitments
<br />
<br />There are currently no outstanding incentive agreements by PEDC except the one discussed in Note
<br />5.
<br />
<br />Note 8: Risk Management
<br />
<br />PEDC is exposed to various risks of loss and has obtained insurance related to general liability, loan
<br />enforcement liability, errors and omissions liability, and automobile liability.
<br />
<br />7
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