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<br />
<br />
<br /> MANAGEMENT'S DISCUSSION AND ANALYSIS
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<br /> As management of the City of Paris, we offer readers of the City of Paris, Texas' financial statements this narrative overview
<br /> and analysis of the financial activities of the City of Paris for the fiscal year ended September 30, 2009. We encourage
<br /> readers to consider the information presented here in conjunction with additional information that we have furnished in our
<br /> letter of transmittal as well as the City's financial statements.
<br /> Financial Highlights of the Primary Government
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<br /> • The City lowered its to rate from 0.56 to 0.52 per $100 of valuation for the fiscal year 2008-09. This makes the
<br /> fourth time the City has lowered its rate since 2003-04 fiscal year when the tax rate was 0.695. For the upcoming
<br /> 2009-10 fiscal year, the City will maintain the 0.52 tax rate. The City has accomplished this 17.5 cent tax rate
<br /> reduction by strict review of its operational needs and increases to the taxable value of property within the City.
<br /> • The number of budgeted positions has dropped from 369 in fiscal year 2002-03 to 322 in fiscal year 2008-09. This
<br /> reduction was also part of an operational review and represents a significant and annually repeating savings to the
<br /> city.
<br /> • City-wide revenues this year exceeded City-wide expenses by $2,518,540 compared to $2,035,405 last year. The
<br /> City has made a concentrated effort to reduce expenses while seeking new sources of revenue and protecting its
<br /> existing revenue sources.
<br /> • Taking advantage of the increase in its General Fund reserves, the City Council authorized a transfer to the Capital
<br /> Projects Fund in the a ount of $794,239 in fiscal year 2006-07 for the City to set up a computer aided dispatch-
<br /> mobile data wireless n ork. This project will completely modernize this communication area of our emergency
<br /> services departments (P lice, Fire, and EMS) and offers opportunity for use by other departments. This project was
<br /> completed in fiscal year 2008-09.
<br /> • The assets of the City o Paris exceeded its liabilities at the close of the most recent fiscal year by $80,075,588 (net
<br /> assets), an increase of 2,518,540 or 3.24% over the previous year amount of $77,557,048. The most important
<br /> factor in this change is the decrease of long-term debt followed by a reduction of accounts payable and other
<br /> current liabilities. Of th amount known as net assets, $22,357,422 (unrestricted net assets) may be used to meet the
<br /> government's ongoing bligations to citizens and creditors.
<br /> • As of the close of th current fiscal year, governmental funds reported combined ending fund balances of
<br /> $15,852,036 compared o $15,328,642 the previous year. This amounts to an increase of $523,394 or 3.41%. This
<br /> increase was due prim ily to an increase in General Fund cash and investments. While the overall combined ending
<br /> fund balances for gove ental funds increased, the unreserved portion of those fund balances was $14,628,082 or
<br /> an increase of $2,254,860 or 18.22% over the previous year amount of $12,373,222. This increase was due to a drop
<br /> in the reserve for constriction. Unreserved fund balance is available for spending at the government's discretion.
<br /> • At the end of the fisc year, unreserved fund balance for the general fund was $13,751,446 or 64.58% of total
<br /> general fund expendi es. The prior year unreserved fund balance was $11,478,815 or 53.92% of general fund
<br /> expenditures. General land expenditures were essentially unchanged while the unreserved fund balance benefited
<br /> from an improved cash osition.
<br /> • The City of Paris' non current liabilities decreased by $3,564,393 or 10.37% during the current fiscal year. This
<br /> decrease is consistent m year to year as the bulk of this decrease is due to payment of bonded debt that was set up
<br /> on a level pay basis.
<br /> • Total charges for serv ces for the City of Paris were $18,646,353 compared to $18,465,197 the previous year
<br /> because increased wat r and sewer collections exceeded the decrease in municipal court fines and EMS fees.
<br /> Operating/capital grant and contributions were $1,542,290 compared to $1,462,681 the previous year. This increase
<br /> was largely due to private contributions. General revenues were $18,637,182 compared to $17,839,079 the previous
<br /> year. This increase was due to increased sales taxes from multiple construction projects in and around the City.
<br /> • Transfers from business-type activities to governmental activities and from governmental activities to business-type
<br /> activities occurred duri g the year in the net amount of $902,699. This included administrative and franchise fees
<br /> transferred from business-type activities to governmental activities plus a one-time transfer of governmental
<br /> activities to business-type activities to reach a desired reserve level in the business-type activity.
<br /> • City-wide liabilities decreased $4,663,383 from $36,130,380 to $31,466,997. This amounted to 12.91%. Long-term
<br /> debt was the single fact r most affecting this change, but all liability categories were down compared to the previous
<br /> year.
<br /> • City-wide expenses increased $575,733 or 1.61% but were within the approved budget.
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