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Home My WebLink AboutCity Packets - City Council - 09/17/2024 - RegularMAYORAL PROCLAMATION WHEREAS: The Constitution of the United States of America, the guardian of our liberties, embodies the principles of limited government in a Republic dedicated to rule by law; and WHEREAS,September 17, 2024, marks the two hundred and thirty-sixth anniversary of the framing of the Constitution of the United States of America by the Constitutional Convention; and WHEREAS,it is fitting and proper to accord official recognition to this magnificent document and its memorable anniversary, and to the patriotic celebrations which will commemorate it; and WHEREAS,Public Law 915 guarantees the issuing of a proclamation each year by the President of the United States of America, designating September 17th through 23rd as Constitution Week. NOW, THEREFORE,I, Richard Boyer, by virtue of the authority vested in me as Mayor of the City of The Colony,in the State ofTexas, do hereby proclaim the week of September 17 through 23 as: CONSTITUTION WEEK and join with members of the Daughters of the Revolution, Sarah Kincaid Cook Chapter, to ask our citizens to reaffirm the ideals the Framers of the Constitution commissioned in 1787, by vigilantly protecting the freedoms guaranteed to us through this guardian of our liberties. IN WITNESS WHEREOF, I have hereunto set my hand and seal of the City of The Colony, Texas, to be affixed this 17th day of September, 2024. Richard Boyer, Mayor City of The Colony 1 These items are strictly public service announcements. Expressions of thanks, congratulations or condolences; information regarding holiday schedules; honorary recognition of city officials, employees or other citizens; reminders about upcoming events sponsored by the City or other entity that are scheduled to be attended by a city official or city employee. No action will be taken and no direction will be given regarding these items. MINUTES OF THE CITY COUNCIL REGULAR SESSION HELD ON SEPTEMBER 3, 2024 The Regular Session of the City Council of the City of The Colony, Texas, was called to order at 6:32 p.m. on the 3 rd day of September 2024, at City Hall, 6800 Main Street, The Colony, Texas, with the following roll call: Richard Boyer, Mayor Judy Ensweiler, Deputy Mayor Pro Tem Robyn Holtz, Councilmember Brian Wade, Councilmember Dan Rainey, Councilmember Perry Schrag, Mayor Pro Tem Joel Marks, Councilmember Present Present Present Present Present Present Present And with 7 councilmembers present a quorum was established and the following items were addressed: 1.0 ROUTINE ANNOUNCEMENTS, RECOGNITIONS and PROCLAMATIONS 1.1 Call to Order Mayor Boyer called the meeting to order at 6:32 p.m. 1.2 Invocation Pastor Jess Allen with One Creation Church delivered the invocation. 1.3 Pledge of Allegiance to the United States Flag The Pledge of Allegiance to the United States Flag was recited. 1.4 Salute to the Texas Flag Salute to the Texas Flag was recited. 1.5 Proclamation recognizing September 2024 as United Way of Denton County - LIVE UNITED Month. Mayor proclaimed the month of September as LIVE UNITED Month. Michael Thomson, Past President UWDC Board Member, Sharon Lee, Landlord Engagement Manager and Shelby Redondo, Program Director for UWDC accepted the proclamation. 1.6 Items of Community Interest Mayor Boyer introduced and welcomed new Police Chief, Phillip Foxall, to The Colony. City Council – Regular Meeting Agenda September 3, 2024 Page| 2 1.6.1 Receive presentation from Parks and Recreation regarding upcoming events and activities. Special Events Supervisor, Chloe Hancock, provided upcoming events and activities to the Council. 2.0 CITIZEN INPUT None. 3.0 WORK SESSION 3.1 Receive a presentation and update from the Children's Advocacy Center. Assistant Police Chief Jay Goodson introduced Kristen Howell, Chief Executive Officer with Children's Advocacy Center for North Texas. Ms. Howell provided an overview on this item. 3.2 Receive updates regarding Oncor service and maintenance plan. Mayor Boyer provided an overview on this item. 3.3 Council to provide direction to staff regarding future agenda items. None 4.0 CONSENT AGENDA Motion to approve all items from the Consent Agenda - Ensweiler; second by Rainey, motion carried with all ayes with the exception of Holtz abstaining. 4.1 Consider approving City Council Regular meeting minutes from August 20, 2024. 4.2 Consider approving a resolution authorizing the Mayor to execute a Joint Election Agreement and Contract for election services with Denton County Elections for the November 5, 2024 General Election. RESOLUTION NO. 2024-064 4.3 Consider approving an ordinance accepting a bid and authorizing the sale of certain parkland generally located at 4526 W. Lake Highlands Drive, The Colony, Denton County, Texas, and related actions thereto. ORDINANCE NO. 2024-2571 City Council – Regular Meeting Agenda September 3, 2024 Page| 3 5.0 REGULAR AGENDA ITEMS 5.1 Conduct a public hearing, discuss and consider an ordinance regarding the approval of a Specific Use Permit (SUP) to allow an approximately 9,530 sq. ft. Kennel with outdoor runs known as “The Dog Stop.” The subject site is located at 5000 Main Street Suite 100 C, within the Shopping Center (SC) Zoning District and Gateway Overlay District. Planning Director, Isaac Williams, presented the proposed ordinance to Council. The public hearing opened at 7:08 and closed at 7:09 p.m. Dennis Hill, applicant, 3605 Brinkley Drive, appeared to answer questions from Council. Motion to approve –Wade; second by Schrag, motion carried with all ayes. ORDINANCE NO. 2024-2572 5.2 Conduct a public hearing discuss and consider an ordinance regarding amendments to Planned Development 26 (PD-26) to reflect new development standards and amend the development plan regarding single-family development of Lot 1R1, Block 16. Planning Director, Isaac Williams, presented the proposed ordinance to Council. Council provided discussion on this item. Richard Ensweiler, 7205 Waters Edge Drive, Home Owner Association President, answered questions from Council. The public hearing opened and closed at 7:20 p.m. with no speakers. Motion to approve –Ensweiler; second by Rainey, motion carried with all ayes. ORDINANCE NO. 2024-2573 5.3 Discuss and consider approving a resolution accepting a preliminary service and assessment plan for the City of The Colony Public Improvement District, and assessment roll on properties located within the Public Improvement District No. 1. for the Fiscal Year 2024-25, and schedule a public hearing for September 17, 2024, concerning the levy of special assessments. City Manager, Troy Powell, provided a brief update on the Grandscape Development assessment plans regarding the police department request for more officers. Mr. Powell stated the request was on hold until the new chief was hired. Executive Business Liaison, Jeremie Maurina, gave an overview of this item. Council provided discussion on this item. Motion to approve –Ensweiler; second by Wade, motion carried with all ayes. City Council – Regular Meeting Agenda September 3, 2024 Page| 4 RESOLUTION NO. 2024-065 5.4 Conduct the first of two public hearings, discuss and consider the City of The Colony Fiscal Year Budget beginning October 1, 2024 through September 30, 2025; providing for intra and inter departmental fund transfers; providing that expenditures for said Fiscal Year to be made in accordance with said budget. Assistant City Manager, Tim Miller, provided an overview of this item. The public hearing opened at 7:49 and closed at 7:50 p.m. with no speakers. 5.5 Conduct a public hearing and discuss the proposed 2024-2025 tax rate not to exceed $0.635000 cents per $100 valuation for the taxable value of real and personal property located within the City of The Colony, and announce that the tax rate will be voted on September 17, 2024 at 6:30 p.m. at The Colony City Hall, 6800 Main Street. Assistant City Manager, Tim Miller, provided an overview of this item. The public hearing opened at 7:55 and closed at 7:55 p.m. with no speakers. 5.6 Discuss and consider all matters incident and related to the issuance and sale of “City of The Colony, Texas, Combination Tax and Limited Surplus Revenue Certificates of Obligation, Series 2024”, including the adoption of an ordinance authorizing the issuance of such certificates of obligation. Assistant City Manager, Tim Miller, introduced Jason Hughes, Managing Director with Hilltop Securities to Council. Mr. Hughes provided an overview on the proposed ordinance. Motion to approve –Wade; second by Ensweiler, motion carried with all ayes with the exception of Holtz abstaining. ORDINANCE NO. 2024-2574 5.7 Discuss and consider approving a resolution amending the Fiscal Year 2023-2024 Master Fee Schedule for the Fiscal Year 2024-2025, effective October 1, 2024. Assistant City Manager, Tim Miller, presented the proposed resolution to Council. Council provided discussion on this item. Motion to approve –Schrag; second by Ensweiler, motion carried with all ayes. RESOLUTION NO. 2024-066 City Council – Regular Meeting Agenda September 3, 2024 Page| 5 Executive Session was convened at 8:10 p.m. 6.0 EXECUTIVE SESSION 6.1 A. Council shall convene into a closed executive session pursuant to Sections 551.071 and 551.072 of the Texas Government Code to deliberate regarding purchase, exchange, lease or value of real property and to seek legal advice from the city attorney regarding Blue Sky Sports Center, L.P. matter. B. Council shall convene into a closed executive session pursuant to Sections 551.071 and 551.087 of the Texas Government Code to deliberate regarding commercial or financial information the Council has received from a business prospect(s), and to deliberate the offer of a financial or other incentive to a business prospect(s), and to seek legal advice from the city attorney regarding Beach and Tennis Club matter. C. Council shall convene into a closed executive session pursuant to Section 551.087 of the Texas Government Code to deliberate commercial or financial information the Council has received from a business prospect, and to deliberate the offer of a financial or other incentive to a business prospect – The Billingsley Company related entity. D. Council shall convene into a closed executive session pursuant to Section 551.072 of the Texas Government Code to deliberate regarding purchase, exchange, lease or value of real property – Overlake Drive. E. Council shall convene into a closed executive session pursuant to Sections 551.072 and 551.087 of the Texas Government Code to deliberate regarding purchase, exchange, lease or value of real property and commercial or financial information the city has received from a business prospect(s), and to deliberate the offer of a financial or other incentive to a business prospect(s). F. Council shall convene into a closed executive session pursuant to Section 551.074 of the Texas Government Code to deliberate the evaluation, reassignment, duties, discipline, or dismissal of the City Manager. Regular Session was reconvened at 9:48 p.m. 7.0 EXECUTIVE SESSION ACTION 7.1 A. Any action as a result of executive session regarding regarding purchase, exchange, lease or value of real property and to seek legal advice from the city attorney regarding Blue Sky Sports Center, L.P. matter. Motion to authorize City Attorney to send a notice of default letter to Blue Sky Sports Center, L.P., on the terms as discussed in executive session Ensweiler; second by Rainey, motion carried with all ayes. City Council – Regular Meeting Agenda September 3, 2024 Page| 6 B. Any action as a result of executive session regarding commercial or financial information the Council has received from a business prospect, and to deliberate the offer of a financial or other incentive to a business prospect, and to seek legal advice from the city attorney regarding Beach and Tennis Club matter. No Action C. Any action as a result of executive session regarding commercial or financial information the Council has received from a business prospect, and to deliberate the offer of a financial or other incentive to a business prospect – The Billingsley Company related entity. No Action D. Any action as a result of executive session regarding purchase, exchange, lease or value of real property – Overlake Drive. Motion to approve a resolution ratifying, authorizing, and approving the Mayor and/or City Manager to execute an unimproved property contract and any and all closing documents necessary for the acquisition of Lots 11 through 18, Block 4 of the Garza Lake Estates Addition, on the terms as discussed in executive session Rainey; second by Wade, motion carried with all ayes. E. Any action as a result of executive session regarding purchase, exchange, lease or value of real property and commercial or financial information the city has received from a business prospect(s), and to deliberate the offer of a financial or other incentive to a business prospect(s). No Action F. Any action as a result of executive session regarding the evaluation, reassignment, duties, discipline, or dismissal of the City Manager. Motion to amend the City Manager’s contract terms as discussed in executive session Wade; second by Rainey, motion carried with all ayes. ADJOURNMENT With there being no further business to discuss, the meeting adjourned at 9:49 p.m. APPROVED: __________________________________ Richard Boyer, Mayor City of The Colony, Texas City Council – Regular Meeting Agenda September 3, 2024 Page| 7 ATTEST: _____________________________________ Tina Stewart, TRMC, CMC, City Secretary Financial Summary: Are budgeted funds available: Yes Source of Funds: 895-669-6670-2353-Lebanon Road Funding Cost of Construction Services Contract: $ 68,881.00 Total estimated project cost: $ 45,793.66 Construction Already authorized Yes $ 23,087.34 Construction Already authorized No $ 68,881.00 Total estimated cost CITY OF THE COLONY, TEXAS RESOLUTION NO. 2024 – ________ A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, AUTHORIZING THE CITY MANAGER TO EXECUTE A CONSTRUCTION SERVICES CONTRACT WITH PENNINGTON CONCRETE & UTILITIES FOR THE EMERGENCY STORM DRAIN REPAIRS ON LEBANON ROAD; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City has determined that it is in the best interest of the City to enter into a Construction Services Contract with Pennington Concrete & Utilities for emergency storm drain repairs on Lebanon Road; and WHEREAS, with this contract, the City of The Colony is agreeing to the services in the amount of $68,881.00 for such work. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, THAT: Section 1.The contract is found to be acceptable and in the best interest of the City and its citizens, be, and the same is hereby, in all things approved. Section 2. The City Manager is hereby authorized to execute the contract on behalf of the City of The Colony, Texas. Section 3.This resolution shall take effect immediately from and after its adoption and it is so resolved. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS THIS 17TH DAY OF SEPTEMBER 2024. _____________________________ Richard Boyer, Mayor City of The Colony, Texas ATTEST: ___________________________________ Tina Stewart, TRMC, CMC, City Secretary APPROVED AS TO FORM: ___________________________________ Jeffrey L. Moore, City Attorney CITY OF THE COLONY, TEXAS ORDINANCE NO. 2024 - ________ AMENDING THE FISCAL YEAR 2023-2024 BUDGET AN ORDINANCE AMENDING ORDINANCE 2023-2534, ADOPTING THE FISCAL YEAR 2023-2024 BUDGET OF CITY OF THE COLONY, TEXAS BY REALIGNING BUDGETS AS SET FORTH HEREIN; PROVIDING FOR INCORPORATION OF PREMISES; PROVIDING FOR THE ADOPTION OF THIS ORDINANCE AMENDING THE FISCAL YEAR 2023-2024 BUDGET FOR THE UTILITY FUND OF THE CITY OF THE COLONY; PROVIDING THAT THIS ORDINANCE SHALL BE CUMULATIVE OF ALL ORDINANCES; PROVIDING A SEVERABILITY CLAUSE; PROVIDING FOR A SAVINGS CLAUSE; AND NAMING AN EFFECTIVE DATE. WHEREAS,the Council of the City of The Colony is conducting business pursuant to a budget for fiscal year 2023-2024, heretofore previously adopted by Ordinance No. 2023-2534 on the 19th day of September, 2023; and WHEREAS,Section 102.010 of the Texas Local Government Code authorizes the governing body of a municipality to make changes in the budget for municipal purposes; and WHEREAS,the City of The Colony finds it in the best interest of the City to increase the 2023-24 UTILITY FUND– Water Sales Revenue by $3,000,000.00 and increase the Dallas Water Purchases by $1,000,000.00 and Plano water purchases by $500,000.00 for the purpose of recording increased revenue from increased water sales and allowing for increased expenses purchasing additional water from outside agencies. WHEREAS, the City Council has reviewed the budget and has determined that a valid municipal purpose is served by such budget increases and reallocation of funds. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS: SECTION 1. INCORPORATION OF PREMISES The above and foregoing premises are incorporated into the body of this Ordinance as if copied herein in their entirety. 2 SECTION 2. AMENDMENT AND ADOPTION That the UTILITY FUND budget for the fiscal year ending September 30, 2024 heretofore previously adopted by Ordinance 2023-2534 duly enacted by the City Council of the City of The Colony on the 19th day of September, 2023, be and is hereby amended as set forth herein, which amendment is hereby, in all respects, finally approved and adopted as so changed; and the same shall be hereby filed with the City Secretary of the City of The Colony. SECTION 3. BUDGET INCREASES That the 2023-24 UTILITY FUND budget revenue is to be increased by an amount not to exceed $3,000,000.00. That the 2023-24 UTILITY FUND Dallas Water Utility Purchases is to be increased by an amount not to exceed $1,000,000.00. That the 2023-24 UTILITY FUND Plano Water Purchases is to be increased by an amount not to exceed $500,000.00. SECTION 4. CUMULATIVE CLAUSE This Ordinance shall be cumulative of all provisions of Ordinances of the City of The Colony, Texas except where the provisions of this Ordinance are in direct conflict with the provisions of such Ordinances, in which event the conflicting provisions of such Ordinances are hereby repealed. SECTION 5. SEVERABILITY CLAUSE It is hereby declared to be the intention of the City Council of The City of The Colony that the phrases, clauses, sentences, paragraphs, and sections of this Ordinance are severable, and if any phrase, clause, sentence, paragraph, or section of this Ordinance should be declared unconstitutional by the valid judgment or decree of any court of competent jurisdiction, such unconstitutionality shall not affect any of the remaining phrases, clauses, sentences, paragraphs, or sections of this Ordinance, since the same would have been enacted by the City Council without incorporation in this Ordinance of any such unconstitutional phrase, clause, sentence, paragraph, or section. SECTION 6. SAVINGS CLAUSE All rights and remedies of the City of The Colony are expressly saved as to any and all violations of the provisions of any Ordinances affecting budgets, budget approval or adoption, which have 3 accrued at the time of the effective date of this Ordinance; and, as to such accrued violations and all pending litigation, both civil and criminal, whether pending in court or not, under such Ordinances, same shall not be affected by this Ordinance but may be prosecuted until final disposition by the courts. SECTION 7. EFFECTIVE DATE This Ordinance shall be in full force and effect from and after its date of passage. DULY PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, ON THIS THE 17th DAY OF SEPTEMBER 2024. __________________________________ Richard Boyer, City Mayor City of The Colony, Texas ATTEST: __________________________________ Tina Stewart, TRMC, CMC, City Secretary APPROVED AS TO FORM: Jeffrey L. Moore, City Attorney Notice of 2024 Tax Year Proposed Tax Rate The governing body of the City of The Colony has proposed a tax rate of $.6350 per $100 valuation for adoption. CITY OF THE COLONY, TEXAS ORDINANCE NO. 2024 - _______ ADOPT TAX RATE FOR FISCAL YEAR 2024-2025 AN ORDINANCE OF THE CITY OF THE COLONY, TEXAS, LEVYING THE AD VALOREM TAXES FOR THE FISCAL YEAR 2023-2024 AT A RATE OF $.6350 PER ONE HUNDRED DOLLARS ($100) ASSESSED VALUATION OF ALL TAXABLE PROPERTY WITHIN THE CORPORATE LIMITS OF THE CITY AS OF JANUARY 1, 2025; TO PROVIDE REVENUES FOR THE PAYMENT OF CURRENT EXPENSES AND TO PROVIDE AN INTEREST AND SINKING FUND ON ALL OUTSTANDING DEBTS OF THE CITY; PROVIDING FOR DUE AND DELINQUENT DATES TOGETHER WITH PENALTIES AND INTEREST; AND DECLARING AN EFFECTIVE DATE. BE IT SO ORDAINED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS: SECTION 1:That there be and is hereby levied for the fiscal year 2024-2025, on all taxable property, real, personal and mixed, situated within the limits of the city of The Colony, Texas, and not exempt by the Constitution of the State and valid State laws, a tax of $.6350 on each One Hundred Dollars ($100) assessed value of taxable property, and shall be apportioned and distributed as follows: (a) For the purpose of defraying the current expenses of municipal government of the City, a tax of $.4812 on each One Hundred Dollars ($100) assessed value of all taxable property. (b) For the purpose of creating a sinking fund to pay interest and principal on all outstanding bonds of the City, not otherwise provided for, a tax of $.1538 on each One Hundred Dollars ($100) assessed value of all taxable property, within the City, which shall be applied to the payment of such interest and maturities of all outstanding bonds. SECTION 2:That all ad valorem taxes shall become due and payable on October 1, 2024 and all ad valorem taxes for the year shall become delinquent after January 31, 2025. There shall be no discount for payment of taxes prior to January 31, 2025. If any person fails to pay the ad valorem taxes on or before the 31st day of January 2025, the following penalties shall be payable thereon, to-wit: During the month of February, seven percent (7%); during the month of March, nine percent (9%); during the month of April, eleven percent (11%); during the month of May, thirteen percent (13%); during the month of June, fifteen percent (15%); and on or after the 1st day of July, eighteen percent (18%). 2 SECTION 3:Taxes are payable at the Denton County office of the tax collector who on behalf of The Colony collects ad valorem taxes for The Colony. The City shall have available all rights and remedies provided by law for enforcement of the collection of taxes levied under this ordinance. SECTION 4:That the tax rolls, as presented to the City Council, together with any supplement thereto, be, and the same are hereby approved. SECTION 5:The fact that it is necessary that this ordinance be enacted in order to authorize the collection of ad valorem taxes for the fiscal year 2024-2025, this ordinance shall take effect from and after its passage as the law in such cases provides. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS THIS 17th DAY OF SEPTEMBER 2024. __________________________________ Richard Boyer, Mayor City of The Colony, Texas ATTEST: ____________________________________ Tina Stewart, TRMC, CMC, City Secretary APPROVED AS TO FORM: Jeffrey L. Moore, City Attorney Proposed Budget 2024/2025 September 3, 2024 Notice of 2024 Tax Year Proposed Tax Rate The governing body of the City of The Colony has proposed a tax rate of $.6350 per $100 valuation for adoption. TABLE OF CONTENTS City Manager’s Message ..................................................................................... 1 General Fund ....................................................................................................... 4 Parks Fund .......................................................................................................... 7 Utility Fund ........................................................................................................... 8 General Debt Service .......................................................................................... 9 Utility Tax Supported Debt ................................................................................. 10 Economic Development Corporation ................................................................. 11 Community Development Corporation ............................................................... 12 TIRZ ONE PID ................................................................................................... 13 Court Security Fund ............................................................................................ 14 Court Technology Fund ...................................................................................... 15 Juvenile Case Manager Fund ............................................................................. 16 Commercial Vehicle Fund .................................................................................. 17 Court Time Payment Fund ................................................................................. 18 Storm Water Utility Fund ..................................................................................... 19 Water/Sewer Impact Fees Fund ........................................................................ 20 Hotel/Motel Tax Fund .......................................................................................... 21 Lake Parks Fund ................................................................................................. 22 Special Events Fund .......................................................................................... 23 Citizen Donation Fund ........................................................................................ 24 Child Safety Fund .............................................................................................. 25 Keep the Colony Beautiful Fund ........................................................................ 26 SLFRF (State and Local Fiscal Recovery Fund)………………………………….. 27 Park Improvements Fund……………………………………………………………..28 Capital Outlay and Comprehensive Improvement Plan (CIP) Summary ............. 29 Debt Management Policies ................................................................................. 34 Financial Management Policies .......................................................................... 50 Investment Policy ............................................................................................... 64 Letter to Mayor and Council The Honorable Mayor and City Council, In accordance with Civil Statues of Texas and the City Charter, the annual budget, for the fiscal year October 1, 2024 through September 30, 2025, is presented for your consideration. The Budget is an important policy document because it presents in financial terms the overall plan to accomplish the City’s program of services during the upcoming fiscal year. 2024-2025 budget highlights: Ad Valorem Taxes are the City’s major revenue source. Total current Ad Valorem Taxes budgeted this year are approximately $46 million which is a 3% increase from the prior year. Approximately $207 million of the increase in tax base came from new construction equating to approximately $1.32 million in increased revenue. Of the $46 million in property taxes budgeted, approximately $34.8 million is in the General Fund and the remaining $11.1 million in General Fund Debt Service. Sales Tax receipts budgeted at $23.5 million, is an increase of $807k or 3.5% above the prior year’s budget. Franchise fees budgeted at $3.3 million, increased $525k or 19% in comparison to prior year. This budget includes about $48.5 million in proposed supplemental requests and capital projects. Projects included are $15.96 million in street, alleyway, drainage, and sidewalk reconstruction. $15.15 million in facility upgrades, $6.19 million vehicle/heavy equipment replacements, $8.76 million in Water/Wastewater with ($5.5 million) of outside funding from ARPA, and $2.45 million for Parks/Lake Parks/CDC. Also included in this budget and supported by operating revenues are 19 employee additions costing $1.3 million. Included in the position additions are Division Chief – Fire and Rescue Training, Registered Sanitarian, Assistant Building Official, Facilities (7) – Janitors, Maintenance Worker, Supervisor, Fleet (2) Techs, Human Resources Assistant, GIS Analyst P/T to F/T, Librarian, P/T Librarian, (2) Senior Center Rec Leaders and P/T Rental Specialist. The budget also includes blended COLA raises of 4%, costing an estimated $1.6 million. Both employee additions and raises are supported by operating revenues. Ending Fund balance in the General Fund is maintained at 80 operating days in reserves. 60 operating days are maintained in Utility and Parks Funds. Economic incentives have been budgeted in the Economic Development (Type A) Fund to promote new enterprises and to retain existing business. To assure a quality community, cultural and leisure activities, and park improvements, funding has been provided in Special Events, Lake Parks, and CDC (Type B) budgets. 1 The total adopted operating budget is $169,059,642, a 17.5% increase from the 23-24 total operating budget. Economic Development The Nebraska Furniture Mart Tax Increment Reinvestment Zone (TIRZ) was established in November of 2011 for a 433-acre $1.5 billion Grandscape development. The Nebraska Furniture Mart store, the anchor store of the development, opened in early March 2015. In June 2020, Scheels All Sports opened the largest sporting goods store in the world offering 85 specialty shops and provided our second anchor store for the development. Numerous restaurants and hotels have also located in the Zone. Fireside Surf, PopStroke, 151 Coffee, Fritz’s Adventures, Rome, World of Beer, Worldsprings and Simply Unwine and COSM opened this past year. North of SH 121 in The Colony, Live Oak Logistics Business Park is nearing completion and currently leasing space. This development is approximately one-million square feet of industrial and office space. In addition, you will find RifleGear, Texas Road House and Bubba’s 33 in this same location. Further down 121, also on the North side and across from the Grandscape development, is Rooms to Go, Chair King and many other restaurants and retailers as well as Topgolf, numerous hotels, medical office buildings and shopping centers. Business activity in The Colony has also brought numerous jobs for our residents. The Nebraska Furniture Mart store alone employs around 1,800 people. The widening of FM 423 (Main Street) from a 4 lane to a 6 lane and 8 lane divided street was completed in late 2017 and has significantly increased redevelopment along this vital corridor. The Tribute, the only remaining sizeable residential development in The Colony, continues to increase the number of buildable lots. Housing permits have remained strong and are expected to do so for the next several years. Quality of Life The City values quality of life for all its residents. The City’s continued funding of Library and Parks and Recreation services help to ensure quality programming remains available to the community. Also of high value is funding for beautification projects to continue to improve the overall aesthetic standard of landscaped areas. The City remains committed to the upkeep and preservation of trees and recently celebrated its 16th anniversary as a “Tree City USA.” Additionally, the City strives to provide high caliber events that showcase a commitment to family friendly activities such as Liberty by the Lake, the American Heroes Festival, and The Colony Summer Kickoff. Looking ahead, the focus will be on further improvements to public spaces, including development of new pickleball courts, Library expansion, and relocation of recreation facilities into a multi-generational center. 2 Future The City Council and management team want to keep the items below on its radar. Continually reduce the property tax rate. Maintain street, alleyway, and sidewalk improvement programs. Facility growth and physical reallocation of departments. Adding staff for internal and external service departments to accommodate exponential growth while continuing to serve citizens’ needs. Preparing for the next steps of the Water and Wastewater infrastructure expansions. Facilitate funding partnerships between CDC and Parks. Strategic Plans The budget process provides a road map for short-term and long-term needs and aids in the allocation of limited resources to prioritized services and needs. Each year a Capital Improvement Program is developed which helps gauge future funding priorities and is the foundation on which annual budgets are built. Capital needs are projected for each of the five following years to identify service needs and financing available. Staff helps Council with the challenge of prioritizing and providing efficient and effective services to the community with current and future available funds. As a combined effort, the City Manager’s Office, Finance Director, and all departments monitor revenues and expenditures throughout the year. Appropriate actions are taken to control expenditures, and to make adjustments when revenues fall short of expectations. Conclusions The 2024-2025 budget has been prepared with the assistance of devoted and dedicated employees who stand ready to accomplish the goals outlined and adopted by the City Council. Under the prudent leadership of the City Council, we commit our best efforts to ensure that the needs of our citizens are met and exceeded! Troy Powell, City Manager 3 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget Current Property Taxes 29,959,076 37,228,090 37,502,544 34,829,684 Rendition Penalty Revenue 9,985 28,424 5,000 16,000 Ag. Roll Back Taxes - 170431 - - Delinquent Property Tax 105,371 117,117 50,000 100,000 Penalties & Interest 81,191 126,143 50,000 100,000 Total 30,155,623 37,670,205 37,607,544 35,045,684 Sales Taxes 10,653,520 10,968,877 12,000,000 23,549,328 Mixed Beverage Tax 773,049 843,265 750,000 750,000 Total 11,426,569 11,812,142 12,750,000 24,299,328 Electric 1,727,856 1,747,182 1,600,000 1,800,000 Natural Gas 267,560 328,868 250,000 400,000 Telephone 151,257 107,321 150,000 150,000 PEG Fees 69,549 45,875 75,000 150,000 Video 167,914 149,953 250,000 250,000 Sanitation-Residential 216,671 246,458 200,000 250,000 Sanitation-Commercial 272,612 286,061 250,000 300,000 Total 2,873,417 2,911,718 2,775,000 3,300,000 TOTAL TAXES 44,455,610 52,394,065 53,132,544 62,645,012 Building Permits-New Homes 727,918 283,296 800,000 850,000 Building Permits-Other 724,085 674,555 750,000 750,000 Commercial Permits 635,639 263,159 700,000 500,000 Certificates Of Occupancy 5,450 4,425 7,500 7,500 Zoning Fees 7,715 14,918 10,000 10,000 Fire Fees 33,430 36,536 20,000 30,000 Solicitors Permits 1,354 876 2,000 2,000 Health Permits 135,920 136,722 200,000 200,000 Platting Fees 15,138 3,246 20,000 20,000 Alcohol Permits 23,095 23,900 25,000 25,000 Code Enforcement Fees 16,841 24,199 25,000 25,000 Eng Inspection Overtime Fee 7,440 10,560 2,500 8,000 Inspection Fees 429,437 476,831 500,000 500,000 Grading Permit 8,311 1,960 1,000 1,000 TOTAL LICENSES & PERMITS 2,771,773 1,955,183 3,063,000 2,928,500 Ambulance Calls 761,886 901,887 800,000 900,000 Ambulance Subscription Revenue 25,266 25,357 25,000 25,000 Service Liens 16,612 18,113 25,000 25,000 Denton County Engine Response - - 1,500 1,500 County Ambulance Funds - 21,344 22,000 22,000 County Fire Funds - 10,000 10,000 10,000 Total 803,764 976,702 883,500 983,500 County Library Funds 46,402 36,670 39,000 55,000 Total 46,402 36,670 39,000 55,000 TOTAL CHARGES FOR SERVICES 850,166 1,023,104 922,500 1,038,500 CHARGES FOR SERVICES TAXES Ad Valorem Taxes City Sales Taxes Fire & Ambulance Library Revenue & Expenditure Projections Fiscal Year 2024-2025 Franchise Taxes LICENSES & PERMITS GENERAL FUND 4 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget Revenue & Expenditure Projections Fiscal Year 2024-2025 GENERAL FUND Municipal Court Fines 1,081,908 835,929 1,100,000 1,100,000 Library Fees 5,947 6,790 10,000 10,000 Animal Control Fees 23,851 19,970 30,000 30,000 TOTAL FINES AND FORFEITURES 1,111,706 862,689 1,140,000 1,140,000 Interest Income 348,704 3,339,920 25,000 2,200,000 TOTAL INVESTMENT INCOME 348,704 3,339,920 25,000 2,200,000 Auction Proceeds 23,610 5,650 10,000 10,000 Tower Rental Fees 53,218 3,714 350,000 350,000 Insurance Reimbursement - - 1,000 1,000 LEISD SRO Reimbursement 142,496 275,586 95,000 160,000 LISD SRO Reimbursement 263,769 443,784 256,000 430,000 Miscellaneous 94,374 94,882 65,000 75,000 Misc Revenue - Grants 5,105 120,949 - - Police Reports 5,602 4,671 4,000 5,000 Alarm Fees 30,941 32,133 30,000 30,000 Lease Interest Revenue 37,469 44,268 - - Rent Income 56,530 - - - Other Financing Sources - Lease 97,920 - - - Lease Income 263,982 263,982 - - TOTAL OTHER REVENUES 1,075,016 1,289,619 811,000 1,061,000 TOTAL REVENUES 50,612,974 60,864,580 59,094,044 71,013,012 Transfer - Storm Water Utility 50,000 50,000 50,000 50,000 Transfer In-GDSF - - - 1,600,000 Transfer - Child Safety Fund 10,000 10,000 10,000 10,000 153,356 155,031 151,031 152,531 244,432 244,718 244,503 244,682 49,671 50,233 49,985 - 131,288 881,000 - - Transfers In - Parking Lot (CDC) 65,265 123,000 - - Transfers In - CARES Fund (2,440,350) - - - Transfer In - CDC - - - - Transfers in - KTKB - - - - TOTAL TRANSFERS (1,736,338) 1,513,982 505,519 2,057,213 48,876,636 62,378,562 59,599,563 73,070,225 Transfers In - EDC S. Colony Conn-Ph2 Transfers In - EDC - Cascades Transfers In - EDC - Memorial Drive Transfers In - Hike & Bike Trail (CDC) FINES AND FORFEITURES OTHER REVENUES TRANSFER IN TOTAL REVENUES & TRANSFERS INVESTMENT INCOME 5 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget Revenue & Expenditure Projections Fiscal Year 2024-2025 GENERAL FUND Non-Departmental 8,599,777 9,574,724 11,694,579 35,716,401 General Administration 1,362,011 1,791,881 2,490,832 2,728,000 City Council 43,253 73,708 147,420 287,112 Community Image 639,704 599,156 621,940 753,093 City Secretary 386,859 516,141 511,352 586,996 Human Resources 848,729 768,140 1,013,392 993,349 Finance 1,369,485 1,308,477 1,393,716 1,676,638 Information Technology 1,044,043 1,048,094 1,185,886 1,479,602 Planning & Development 3,886 300,751 316,875 373,575 Municipal Court 475,779 521,073 522,040 573,695 Public Safety Dispatch 1,595,965 1,614,765 1,976,081 2,180,381 Fire 12,161,032 13,715,451 13,959,064 15,305,089 Police 12,379,860 14,084,554 14,673,747 16,111,962 Animal Control 627,041 698,224 660,483 771,890 Library 1,222,303 1,312,510 1,334,172 1,570,158 Engineering 2,245,272 2,080,129 2,235,870 2,438,831 Facilities Maintenance 1,282,198 1,398,871 1,360,008 1,347,276 Fleet Services 1,371,088 1,436,993 1,348,113 1,633,359 Personnel Additions/Benefits/Equipment - - 600,000 978,387 Salary Increases/Cert - - 2,600,000 59,603 Non-Capital items - - 2,500,000 - TOTAL EXPENDITURES 47,658,286 52,843,641 63,145,570 87,565,397 Transfer - CVB 115,000 400,000 800,000 0 Transfer - Special Events 345,000 400,000 444,000 0 Transfer - KTB 10,000 10,000 10,000 10,000 Transfer - EDC - 17,605 100,000 - Transfer - Storm Water - 1,102,000 - - Transfer - Utility - - - - Transfer - Parks Fund 2,946,823 3,201,823 2,810,000 2,510,000 Transfer - Tax Supported Debt Service - - 4,300,000 Transfer - GDS - - - Transfer - Trinity North - - - - Transfer - G.F. Special Cap - - - - TOTAL TRANSFER OUT 3,416,823 5,131,428 8,464,000 2,520,000 51,075,109 57,975,069 71,609,570 90,085,397 OH COST ALLOCATION (6,691,461) (5,661,461) (5,661,461) (5,711,461) 21,507,222 26,000,210 36,065,164 29,716,619 4,492,988 10,064,955 (6,348,546) (11,303,711) 26,000,210 36,065,164 29,716,619 18,412,907 26,000,210 36,065,164 29,716,619 18,412,907 214 252 164 80 EXCESS/(DEFICIENCY) ENDING FUND BALANCE UNRESERVED FUND BALANCE Working Days in Fund Balance BEGINNING FUND BALANCE EXPENDITURES TRANSFER OUT TOTAL EXPENDITURES & TRANSFERS 6 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget Recreation Program Revenue 246,142 299,242 225,000 275,000 Athletic Program Revenue 102,469 87,645 65,000 85,000 Athletic & Recreation Facility Revenue 308,547 274,748 200,000 175,400 Pass Revenue 26,346 26,038 20,000 20,000 Total 683,505 687,674 510,000 555,400 Swimming Lessons 206,994 224,763 180,000 190,000 Entrance Fees 28,458 40,383 27,000 30,000 Concession Sales 1,829 1,318 1,000 1,100 Private Party Fees 88,407 84,728 90,000 85,000 Total 325,688 351,192 298,000 306,100 Rental Revenue 18,970 20,389 10,000 15,000 Program Revenue 1,719 1,571 2,000 2,000 Travel Commissions 12,867 -- Trip Revenue - 8,236 8,000 10,000 Membership Fees 8,392 14,027 7,500 10,000 Total 41,948 44,223 27,500 37,000 TOTAL CHARGES FOR SERVICES 1,051,141 1,083,088 835,500 898,500 Hawaiian Water 217,723 534,706 150,000 150,000 Athletic Club - 34,815 - 75,000 Miscellaneous 7,064 5,622 6,500 Interest Income 25,628 202,036 1,000 1,000 TOTAL OTHER INCOME 250,415 777,179 157,500 226,000 TOTAL REVENUES 1,301,556 1,860,267 993,000 1,124,500 Transfer - General Fund 2,946,823 3,201,823 2,810,000 2,510,000 Transfer - CDC - 0 - 850,000 Transfer - CDC Five Star Maintenance 165,000 165,000 - 0 Transfer - CDC Fund Personnel 134,845 134,845 134,845 0 Transfer - Lake Parks Fund 35,000 35,000 50,000 50,000 TOTAL TRANSFERS 3,281,668 3,536,668 2,994,845 3,410,000 4,583,224 5,396,935 3,987,845 4,534,500 Non-Departmental 48,564 - Parks & Recreation 2,558,287 2,560,237 2,909,278 3,451,124 Aquatic Park 548,616 480,189 499,840 561,687 Community Center 294,733 272,451 271,919 303,017 Capital - - - - TOTAL EXPENDITURES 3,450,200 3,312,878 3,681,037 4,315,828 OH COST 1,014,398 1,014,398 1,014,398 1,014,398 1,184,563 1,303,189 2,372,848 1,665,258 118,626 1,069,659 (707,590) (795,726) 1,303,189 2,372,848 1,665,258 869,532 107 200 129 60 TOTAL REVENUES & TRANSFERS EXPENDITURES CHARGES FOR SERVICES Parks & Recreation Aquatic Park Community Center EXCESS (DEFICIENCY) OTHER INCOME Working Days in Fund Balance ENDING FUND BALANCE BEGINNING FUND BALANCE TRANSFER IN PARKS FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 7 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget CHARGES FOR SERVICES 15,875,716 17,176,512 16,000,000 17,500,000 8,289,562 8,816,615 9,000,441 9,500,000 5,940 4,880 8,000 8,000 486,114 598,743 425,000 475,000 267,425 125,500 180,000 250,000 128,754 910,400 18,000 900,000 85,425 81,699 125,000 125,000 Solid Waste / Recycling 80,690 91,547 - - Recycling Education Contribution 36,000 36,000 36,000 36,000 25,255,627 27,841,897 25,792,441 28,794,000 TRANSFERS IN 100,000 100,000 100,000 100,000 - - - - - - - Transfer - Capital Projects - Water meters - - - - - - - - 100,000 100,000 100,000 100,000 TOTAL REVENUES & TRANSFERS 25,355,627 27,941,897 25,892,441 28,894,000 EXPENDITURES 1,508,530 1,586,185 1,716,329 2,060,038 Environmental 112,260 110,890 138,500 146,500 Storm Water - Engineering 21,764 9,050 63,503 63,500 Storm Water - Streets & Drainage 149,381 115,229 193,377 219,854 2,723,809 2,742,457 4,043,283 3,910,602 1,064,141 1,036,801 1,342,594 1,612,099 4,789,875 5,409,155 4,698,074 4,732,526 2,125,639 2,255,176 1,773,376 2,391,752 85,693 108,223 327,000 275,500 Capital - - - - 12,581,092 13,373,167 14,296,036 15,412,371 TRANSFERS OUT - - - - 6,000,000 6,000,000 8,550,000 8,550,000 - - - - - - - TOTAL TRANSFERS OUT 6,000,000 6,000,000 8,550,000 8,550,000 18,581,092 19,373,167 22,846,036 23,962,371 OH COST 5,498,630 4,448,630 4,448,630 4,498,630 4,527,733 5,803,638 9,923,738 8,521,513 1,275,905 4,120,099 (1,402,225) 432,999 5,803,638 - 9,923,738 8,521,513 8,954,512 88 152 114 115 TOTAL REVENUES Water Service Wastewater Service UTILITY FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 Reconnect Fees Penalties Tap Connection Fees Interest Income Miscellaneous Waste Water Customer Service - Administration Streets & Drainage TOTAL EXPENDITURES Transfer - Storm Water Utility Fund TOTAL TRANSFERS IN Non-Departmental Water Production Water Distribution Transfer - CIP Transfer - Capital Projects - Streets Transfer - General Fund Transfer - General Fund Transfer - Utility Debt Service Transfer - D. S. Revenue bonds Transfer - Special Projects Transfer - Capital Projects Admin TOTAL EXPENDITURES & TRANSFERS BEGINNING FUND BALANCE EXCESS (DEFICIENCY) ENDING FUND BALANCE Working Days in Fund Balance 8 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget Revenues 9,485,693 7,073,578 7,444,325 11,133,040 34,719 28,384 25,000 25,000 - 55,216 - 25,735 26,388 25,000 25,000 65,249 557,392 40,000 500,000 Bond Proceeds 12,225,000 - -- Bond Premiums 817,990 - - - - - -- 22,654,385 7,740,958 7,534,325 11,683,040 TRANSFERS IN -- - - - - - TOTAL REVENUES & TRANSFERS 22,654,385 7,740,958 7,534,325 11,683,040 EXPENDITURES Refunding Bonds - 2011/2002 703,456 -- - Refunding Bonds - 2012/2003 &2007 222,825 224,025 -- 153,356 155,031 151,531 152,531 Refunding Bonds - 2013/2004 GF/Utility 371,750 373,700 372,750 - Refunding Bonds - 2014/2006 GF/Utility 268,893 269,361 268,447 268,728 Refunding Bonds - 2015/2005 &2007 GF/Utility 688,398 685,950 688,602 687,242 Refunding Bonds - 2020/2010 &2010A 815,681 811,912 807,012 808,519 Certificates of Obligation - 2014 221,476 221,467 221,502 221,869 Certificates of Obligation - 2016 1,131,913 947,726 948,513 947,726 Certificates of Obligation - 2018 1,085,085 1,085,310 913,860 913,365 Certificates of Obligation - 2019 992,717 991,709 992,329 864,454 Certificates of Obligation - 2020 253,938 253,500 252,813 253,125 Certificates of Obligation - 2021 492,860 491,625 491,738 491,175 Certificates of Obligation - 2022 - 935,530 933,975 934,800 Governmental Capital 10 year note (2)112,165 112,165 112,165 - Equipment Capital Lease 10 year Oshkosh 135,693 135,693 135,693 135,693 Governmental Capital 3 year note (1) 220,279 - - - 250,245 4,157 200,000 4,000 TOTAL EXPENDITURES 8,120,729 7,698,861 7,490,930 6,683,227 Transfer - General Fund - - - 1,600,000 Transfer - CIP 12,780,000 - -- TOTAL EXPENDITURES & TRANSFERS 20,900,729 7,698,861 7,490,930 8,283,227 1,753,656 42,098 43,395 3,399,813 10,070,241 11,823,897 11,865,995 11,909,390 11,823,897 11,865,995 11,909,390 15,309,203 BEGINNING FUND BALANCE ENDING FUND BALANCE Certificates of Obligation - 2013 Fiscal Agent Fees & Other TOTAL TRANSFERS IN TRANSFER OUT EXCESS (DEFICIENCY) Transfers In - General Fund GENERAL DEBT SERVICE Revenue & Expenditure Projections Fiscal Year 2024-2025 Ag. Roll Back Taxes TOTAL REVENUES Current Property Taxes Delinquent Property Taxes Penalty & Interest Investment Income Misc Income 9 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget CHARGES FOR SERVICES 1,084 6,346 - - - - 1,040,825 535,986 - 400,000 - - - Fees- SRF Revenue 482,372 488,591 450,000 450,000 Gain on Refunding - - - - 133,296 272,803 - 200,000 1,657,577 1,303,725 450,000 1,050,000 TRANSFERS IN Transfers In - EDC 4A 305,759 306,118 305,849 306,073 Water/Sewer Impact Fees 750,000 750,000 750,000 750,000 SLFRF Fund Transfer - - 11,032,945 Revenue Supported Debt Balance Transfer - - - - Transfers In - Utility Fund 6,000,000 6,000,000 8,550,000 8,550,000 Transfer In - General Fund 4,300,000 Premium - - - 7,055,759 7,056,118 24,938,794 9,606,073 TOTAL REVENUES & TRANSFERS 8,713,336 8,359,843 25,388,794 10,656,073 EXPENDITURES General Obligation Refunding Bonds - 2011 222,144 - - - Revenue Refunding Bonds 2012 (03,07,08) 74,275 74,675 - - General Obligation Refunding Bonds - 2013 1,487,000 1,494,800 1,491,000 - General Obligation Refunding Bonds - 2014 1,312,832 1,315,144 1,310,653 1,312,023 General Obligation Refunding Bonds - 2020 266,319 265,088 263,488 263,981 Cetificate of Obligation - 2014 1,360,493 1,360,439 1,360,654 1,362,912 Cetificate of Obligation - 2015 820,450 817,850 817,425 829,125 Cetificate of Obligation - 2015 Refunding 323,952 322,800 324,048 323,408 Cetificate of Obligation - 2016 485,106 406,168 406,506 406,168 Cetificate of Obligation - 2018 120,565 120,590 101,540 101,485 Cetificate of Obligation - 2019 608,439 607,822 608,202 529,827 Cetificate of Obligation - 2020 761,813 760,500 758,438 759,375 Cetificate of Obligation - 2021 54,762 54,625 54,638 54,575 Cetificate of Obligation - 2022 - 623,687 622,650 623,200 Fees/Cost of Issuance 178,392 3,456 20,000 21,500 Transfer - CIP 8,520,000 - TOTAL EXPENDITURES 16,596,542 8,227,644 8,139,242 6,587,579 (7,883,206) 132,199 17,249,552 4,068,494 5,163,648 (2,719,558) (2,587,359) 14,662,193 (2,719,558) (2,587,359) 14,662,193 18,730,687 Current Property Taxes Delinquent Property Taxes UTILITY TAX SUPPORTED DEBT Revenue & Expenditure Projections Fiscal Year 2024-2025 EXCESS (DEFICIENCY) BEGINNING FUND BALANCE ENDING FUND BALANCE Amortization of Premium Penalty & Interest Investment Income TOTAL REVENUES TOTAL TRANSFERS IN TRANSFER OUT 10 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget CITY SALES TAXES Gross Sales Tax Revenues 5,326,704 5,483,439 6,000,000 11,774,664 Investment Income 92,091 724,017 50,000 1,012,356 Bond Proceeds - - - - Miscellaneous Revenue 2,163 2,145 - - TOTAL REVENUES 5,420,958 6,209,600 6,050,000 12,787,020 EXPENDITURES Personnel Services 456,714 531,709 540,322 587,001 Contractual Services 34,171 50,676 261,500 297,000 Marketing 270,982 301,681 425,000 425,000 Supplies 14,617 18,328 20,000 24,000 Maintenance 368 1,579 1,500 1,500 Building Roof Maintenance 136,799 118,580 - - Economic Development Incentives 193,604 103,520 3,130,000 7,693,000 Grant Program 3,264 13,302 75,000 500,000 Debt Service - Land 607,968 607,920 607,344 611,152 Capital SUV - 65,000 - - Capital Outlay-Vehicles 121,414 - Captial Outlay - Parking Lot Improvements - - 1,000,000 Capital Outlay-Generator - 15,440 225,000 Capital Outlay-Fiber Loop - 276,295 623,705 - Capital Outlay - Other Equipment - - 40,000 Sales Tax Rebate 214,940 248,657 290,000 7,635,000 TOTAL EXPENDITURES 1,933,427 2,474,101 7,239,371 17,773,653 TRANSFERS OUT Transfer Out - General Fund BPP - - - - Transfer Out - GF Cap Contribution - - - - Transfer Out - GF -(S.Colony Conn-Ph2) 153,356 155,031 151,031 152,531 Transfer Out - GDSF - Cascades 244,432 244,718 244,503 244,682 Transfer Out - GDSF 49,671 50,233 49,985 *01 0 Transfer Out - UFDS 305,759 306,118 305,849 306,073 TOTAL TRANSFERS OUT 753,218 - 756,100 751,368 703,286 TOTAL EXPENDITURES 2,686,645 3,230,201 7,990,739 18,476,939 OH COST 71,376 91,380 91,380 91,380 EXCESS (DEFICIENCY) 2,662,937 2,888,019 (2,032,119) (5,781,299) BEGINNING FUND BALANCE 12,312,252 14,975,189 17,863,208 15,831,089 ENDING FUND BALANCE 14,975,189 17,863,208 - 15,831,089 - 10,049,790 *01 ECONOMIC DEVELOPMENT - TYPE A SALES TAXES Revenue & Expenditure Projections Fiscal Year 2024-2025 This is the final payment for this debt series 11 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget CITY SALES TAXES 5,326,704 5,483,439 6,000,000 11,774,664 69,569 541,828 50,000 50,000 Miscellaneous 1,200 - 5,397,472 6,025,267 6,050,000 11,824,664 TRANSFERS IN Transfer from General Fund - - Transfer from Capital Projects Fund - - TOTAL TRANSFERS IN - - - - - - TOTAL REVENUES & TRANSFERS 5,397,472 6,025,267 6,050,000 11,824,664 EXPENDITURES-OPERATIONAL 156,672 150,017 185,425 2,915 54,324 51,353 90,000 4,000 2,630 8,436 8,750 5,700 49,903 49,470 57,936 53,590 Sales Tax Rebate 214,940 248,657 241,500 7,186,228 - - - - 478,468 507,932 583,611 7,252,433 TRANSFERS OUT Trnsfr Out - GDSF (Complex Debt) - - - Trnsfr Out - Parks Fd (Five Star Maint.) 165,000 165,000 165,000 Trnsfr Out - Parks Fd - 0 0 850,000 Trnsfr Out - GDSF (Hike & Bike Trail) 131,288 881,000 *01 - - Trnsfr Out GDSF (Parking Lot) 65,265 123,000 *01 Trnsfr Out - Parks Fund (Personnel) 134,845 134,845 134,845 Trnsfr Out - Park Improvement - 7,083,340 4,000,000 - 3,500,000 TOTAL TRANSFERS OUT 496,398 - 8,387,185 4,299,845 4,350,000 TOTAL EXPENDITURES & TRANSFERS 974,866 - 8,895,117 4,883,456 11,602,433 OH COST 35,688 35,692 35,692 35,692 4,386,918 (2,905,542) 1,130,852 186,539 6,281,803 10,668,721 7,763,179 8,894,031 10,668,721 7,763,179 8,894,031 9,080,570 *01 This debt was paid off in FY 22/23 Sales Tax Revenues Investment Income COMMUNITY DEVELOPMENT - TYPE B SALES TAXES Revenue & Expenditure Projections Fiscal Year 2024-2025 TOTAL EXPENDITURES EXCESS (DEFICIENCY) BEGINNING FUND BALANCE ENDING FUND BALANCE TOTAL REVENUES Personnel Services Capital Outlay Contractual Services Supplies Maintenance 12 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES Assessment 902,327 1,304,422 1,335,447 1,335,447 Interest Income 16,553 103,011 - - Misc - - - - TOTAL REVENUES 918,880 1,407,433 1,335,447 1,335,447 EXPENDITURES Personnel Services 703,813 285,166 288,533 301,250 Contractual Services 693,080 750,823 701,000 711,000 Supplies 974 1,147 1,000 1,200 Maintenance & Utility 163,600 76,171 197,000 139,000 Inspections ---- Capital Outlay ---- TOTAL EXPENDITURES 1,561,467 1,113,307 1,187,533 1,152,450 ADDED SUPPLEMENTAL SERVICES --78,903 (642,586)294,125 69,011 182,997 1,371,329 728,743 286,290 *01 355,301 728,743 1,022,868 355,301 538,298 *01 Starting with 2023-2024 version of this document, the method in which the ending fund balance is derived for this item is changing to a more dynamic calculation to bring that number in line with the amount detailed in the City of The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update. Prior to FY 23 this calculation was originally calculated as 90/365 day operating balance. Starting in FY 24, the calculation will be based off of a dynamic snapshot of current expenditures at the start of the budget process and real-time forecasting of expenses that will occur between the snapshot and the end of the fiscal year. These Changes are reflected in both the 22/23 and the 23/24 budget columns BEGINNING FUND BALANCE ENDING FUND BALANCE TIRZ ONE PID Revenue & Expenditure Projections Fiscal Year 2024-2025 EXCESS (DEFICIENCY) 13 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES Court Security Revenue 28,970 22,090 20,000 20,000 Investment Income TOTAL REVENUES 28,970 22,090 20,000 20,000 EXPENDITURES Personnel Services - - - - Contractual Services 600 2,000 - - Supplies - 2,921 4,000 5,000 Maintenance - - - 1,000 Capital Outlay 10,761 - - - TOTAL EXPENDITURES 11,361 4,921 4,000 6,000 17,608 17,169 16,000 14,000 284,408 302,016 319,185 335,185 302,016 319,185 335,185 349,185 BEGINNING FUND BALANCE ENDING FUND BALANCE EXCESS (DEFICIENCY) COURT SECURITY Revenue & Expenditure Projections Fiscal Year 2024-2025 14 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES Court Technology Revenue 23,910 18,124 16,000 16,000 Investment Income - - - - TOTAL REVENUES 23,910 18,124 16,000 16,000 EXPENDITURES Contractual Services - - -- Supplies/ copiers/Telephone - 516 1,000 300 Maintenance - Tyler/Duncan Parking Tech 13,497 - 20,000 15,000 Non-Capital Capital Outlay - - - - Overhead Costs TOTAL EXPENDITURES 13,497 516 21,000 15,300 10,413 17,609 (5,000) 700 35,406 45,819 63,428 58,428 45,819 63,428 58,428 59,128 ENDING FUND BALANCE EXCESS (DEFICIENCY) BEGINNING FUND BALANCE COURT TECHNOLOGY Revenue & Expenditure Projections Fiscal Year 2024-2025 15 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES Juvenile Case Manager Fee 42,407 23,021 40,000 40,000 Investment Income - - TOTAL REVENUES 42,407 23,021 40,000 40,000 EXPENDITURES Personnel Services - - - - TOTAL EXPENDITURES - - - - 42,407 23,021 40,000 40,000 53,474 95,881 118,903 158,903 95,881 118,903 158,903 198,903 ENDING FUND BALANCE JUVENILE CASE MANAGER FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 EXCESS (DEFICIENCY) BEGINNING FUND BALANCE 16 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES Commercial Vehicle Fee/Weight 9,454 2,059 5,000 5,000 Investment Income TOTAL REVENUES 9,454 2,059 5,000 5,000 EXPENDITURES Personnel Services - 3,054 - 4,200 Contractual Services - 500 300 Supplies 953 262 -500 Maintenance --- Capital Outlay -- - TOTAL EXPENDITURES 953 3,316 500 5,000 8,501 (1,257) 4,500 - 4,360 12,861 11,604 16,104 12,861 11,604 16,104 16,104 ENDING FUND BALANCE COMMERCIAL VEHICLE FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 EXCESS (DEFICIENCY) BEGINNING FUND BALANCE 17 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES Court Time Payment Fee 4,806 6,152 3,000 3,000 Investment Income - - - - Transfer In - General Fund - - - - TOTAL REVENUES 4,806 6,152 3,000 3,000 EXPENDITURES Personnel Services - - - - Contractual Services - - - - Supplies ---- Maintenance 6,954 -- Capital Outlay ---- TOTAL EXPENDITURES 6,954 --- (2,148) 6,152 3,000 3,000 29,113 26,965 33,116 36,116 26,965 33,116 36,116 39,116 ENDING FUND BALANCE COURT TIME PAYMENT FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 EXCESS (DEFICIENCY) BEGINNING FUND BALANCE 18 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES Municipal Jury Fee ---- TOTAL REVENUES - - - - EXPENDITURES Personnel Services - - - Contractual Services - - - - Supplies ---- Maintenance -- - - Capital Outlay --- - TOTAL EXPENDITURES -- - - - - - - - - - - - - - ENDING FUND BALANCE MUNICIPAL JURY FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 EXCESS (DEFICIENCY) BEGINNING FUND BALANCE 19 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES 1,256,518 1,275,523 1,000,000 1,300,000 Reimbursement Tribute PTNRS - - - - - - 1,256,518 1,275,523 1,000,000 1,300,000 Transfer In - General Fund - 1,102,000 - TOTAL REVENUES & TRANSFERS 1,256,518 2,377,523 1,000,000 1,300,000 EXPENDITURES Contractual Servics - - - - Maintenance 695,313 370,758 - - Capital Outlay 115,350 520,467 1,000,000 - TOTAL EXPENDITURES 810,663 891,226 - 1,000,000 - - TRANSFERS OUT 50,000 50,000 50,000 50,000 -203,925 -- Projects to be determined -- - 100,000 100,000 100,000 100,000 TOTAL TRANSFERS OUT 150,000 353,925 150,000 150,000 960,663 1,245,151 1,150,000 150,000 295,855 1,132,373 (150,000) 1,150,000 953,416 1,249,271 2,381,644 2,231,644 1,249,271 2,381,644 2,231,644 3,381,644 Storm Water Utility Fees Investment Income STORM WATER UTILITY FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 TOTAL EXPENDITURES & TRANSFERS EXCESS (DEFICIENCY) BEGINNING FUND BALANCE ENDING FUND BALANCE TOTAL REVENUES Transfer - General Fund Transfer - Utility CIP Transfer - Utility Fund 20 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget IMPACT FEES Water Impact Fees 718,332 222,501 400,000 400,000 Sewer Impact Fees 344,883 120,734 200,000 200,000 Investment Income ---- TOTAL REVENUES 1,063,215 343,235 600,000 600,000 EXPENDITURES Water Impact Fee Reimbursement - - - - Sewer Impact Fee Reimbursement 28,434 - 240,000 240,000 Contractual Services - Water Master Plan - - - - TOTAL EXPENDITURES 28,434 - 240,000 240,000 TRANSFERS OUT: Transfer - Capital Project Admin - - - Transfer - Utility Revenue Debt Service 750,000 750,000 750,000 750,000 TOTAL TRANSFERS OUT 750,000 750,000 750,000 750,000 TOTAL EXPENDITURES & TRANSFERS 778,434 750,000 990,000 990,000 EXCESS (DEFICIENCY)284,781 (406,765)(390,000)(390,000) BEGINNING FUND BALANCE 1,074,090 1,358,871 952,106 562,106 ENDING FUND BALANCE 1,358,871 952,106 562,106 172,106 WATER/SEWER IMPACT FEES FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 21 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget HOTEL/MOTEL TAXES Taxes 1,937,273 2,356,974 1,200,000 2,010,000 Miscellaneous 1,688 1,095 - - 1,938,961 2,358,069 1,200,000 2,010,000 TRANSFERS IN Transfer from - General Fund 115,000 400,000 800,000 0 TOTAL TRANSFERS IN 115,000 400,000 800,000 - TOTAL REVENUES & TRANSFERS 2,053,961 2,758,069 2,000,000 2,010,000 EXPENDITURES Communications 120,740 129,090 129,674 136,734 10,099 11,132 14,740 15,440 1,384 1,503 4,050 2,650 Maintenance - - 900 500 339,949 340,408 396,327 397,008 Contractual Services 391,610 560,051 689,575 677,595 12,744 8,499 12,000 12,000 Maintenance 5,623 - 24,190 20,173 426,322 314,925 275,000 450,000 6,996 31,177 - - 1,315,467 1,396,786 1,546,456 1,712,100 TRANSFERS OUT Transfer to CIP - - - - Transfer to Special Event 200,000 200,000 200,000 700,000 TOTAL TRANSFERS OUT 200,000 200,000 200,000 700,000 TOTAL EXPENDITURES & TRANSFERS 1,515,467 1,596,786 1,746,456 2,412,100 OH COST 35,681 35,691 35,691 35,691 502,814 1,125,592 217,853 (437,791) 381,395 884,209 2,009,801 2,227,654 884,209 2,009,801 2,227,654 1,789,863 TOTAL REVENUES HOTEL/MOTEL TAX FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 EXCESS (DEFICIENCY) BEGINNING FUND BALANCE ENDING FUND BALANCE Personnel Services Contractual Services Supplies CVB Personnel Services Capital Items TOTAL EXPENDITURES Supplies NFM HOT Reimbursements 22 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget CHARGES FOR SERVICES 335,138 372,429 299,000 304,000 Concession Revenues - 769 1,000 1,000 Tribute Lease 101,074 123,466 220,000 120,000 Old American Lease - - - - Blue Sky 732 - 12,000 12,000 Marine Quest 166,250 139,218 90,000 90,000 4,602 19,218 - - Mitigation Fees - - - - 100,553 100,553 - - 708,350 755,653 622,000 527,000 TOTAL REVENUES & TRANSFERS 708,350 755,653 - 622,000 527,000 EXPENDITURES 10,044 17,860 30,300 34,050 - - - 20,000 80,623 80,342 95,950 109,300 4,829 11,922 12,250 15,150 64,218 112,110 46,000 55,000 Non-Capital - Other Equipment - - - - 32,484 4,200 - - 192,197 226,434 184,500 233,500 TRANSFERS OUT 35,000 35,000 50,000 50,000 TOTAL TRANSFERS OUT 35,000 35,000 50,000 50,000 227,197 261,434 234,500 283,500 481,153 494,219 387,500 243,500 1,079,364 1,560,517 2,054,735 2,442,235 1,560,517 2,054,735 2,442,235 2,685,735 Maintenance ENDING FUND BALANCE Capital Outlay TOTAL EXPENDITURES Transfer to Parks Fund TOTAL EXPENDITURES & TRANSFERS EXCESS (DEFICIENCY) BEGINNING FUND BALANCE Lease Interest Revenue Lease Revenue TOTAL REVENUES Contractual Services Supplies Part Time Temporary Personel Professional Services Fees & Permits LAKE PARKS FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 23 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES Donations & Sponsorships 25,440 31,852 13,000 36,200 36,737 23,719 17,000 36,000 62,177 55,572 30,000 72,200 TRANSFERS IN 345,000 400,000 444,000 0 200,000 200,000 200,000 700,000 545,000 600,000 644,000 700,000 TOTAL REVENUES & TRANSFERS 607,177 655,572 674,000 772,200 EXPENDITURES Personnel 156,247 116,859 150,779 160,768 Supplies 13,125 - - 0 Printing Services 1,562 3,284 3,500 3,200 Christmas 5,246 7,384 7,500 10,500 Christmas Light Show Supplemental 50,000 49,512 65,000 65,000 Liberty by The Lake 85,778 45,544 96,000 100,000 American Heroes 219,560 275,305 245,000 245,000 Parent Child Event 5,399 6,550 6,550 6,550 Halloween Campout 6,120 6,000 - - Easter Egg Hunt 4,532 6,092 6,500 7,500 Event Marketing 2,467 4,378 3,500 3,500 Arbor Day 737 1,209 2,500 1,750 Movies In The Park 6,448 4,915 6,000 6,000 Coach Cox Kids Chase 3,506 2,537 4,000 4,500 Up, Up & Away 3,506 2,537 4,000 4,000 Back To School 0 0 0 2,500 Bow Wow Pow Wow 2,302 1,074 2,000 2,000 Road Runners Club 10,000 10,000 10,000 10,000 N TX Food Pantry 8,000 - 5,000 5,000 Chamber Golf Tourney - - 6,000 6,000 Lakeside Community Theatre 12,000 12,000 12,000 12,000 Metro Relief - - - - TOTAL EXPENDITURES 596,536 555,180 635,829 655,768 OH COST 35,688 35,670 35,670 35,670 (25,047) 64,722 2,501 80,762 3,372 (21,675) 43,047 45,548 (21,675) 43,047 45,548 126,310 Event Revenues SPECIAL EVENTS FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 ENDING FUND BALANCE TOTAL REVENUES Transfer from - General Fund Transfer from - Hotel/Motel Tax TOTAL TRANSFERS IN EXCESS (DEFICIENCY) BEGINNING FUND BALANCE 24 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES One Dollar Donation 257 252 300 300 Recycling Rebate Donation - - - - Investment Income - - - - TOTAL REVENUES 257 252 300 300 EXPENDITURES Contractual Services - - - - TOTAL EXPENDITURES - - - - 257 252 300 300 10,134 10,391 10,643 10,943 10,391 10,643 10,943 11,243 BEGINNING FUND BALANCE ENDING FUND BALANCE EXCESS (DEFICIENCY) CITIZEN DONATION FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 25 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES Child Safety Fund Revenue 2,651 3,293 1,700 2,000 Denton County Child Safety Fund 49,330 50,545 49,000 50,000 51,981 53,838 50,700 52,000 TOTAL REVENUES & TRANSFERS 51,981 53,838 50,700 52,000 EXPENDITURES Child Advocacy Center - 59,500 65,608 50,000 TOTAL EXPENDITURES - 59,500 65,608 50,000 TRANSFER OUT Transfer - General Fund 10,000 10,000 10,000 10,000 TOTAL TRANSFER OUT 10,000 10,000 10,000 10,000 10,000 69,500 75,608 60,000 41,981 (15,662) (24,908) (8,000) 44,689 86,670 71,008 46,100 86,670 71,008 46,100 38,100ENDING FUND BALANCE TOTAL REVENUES TOTAL EXPENDITURES & TRANSFERS CHILD SAFETY FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 EXCESS (DEFICIENCY) BEGINNING FUND BALANCE 26 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES Donations ---- - - - - TRANSFERS IN 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 TOTAL REVENUES & TRANSFERS 10,000 10,000 10,000 10,000 EXPENDITURES Personnel 609 445 2,200 2,250 Contractual Services - - 300 300 Supplies 25 7,907 11,700 13,200 Maintenance -- - - TOTAL EXPENDITURES 634 8,351 14,200 15,750 TRANSFERS OUT General Fund -- - - 634 8,351 14,200 15,750 9,366 1,649 (4,200) (5,750) 1,833 11,199 12,847 8,647 - 11,199 12,847 8,647 2,897 ENDING FUND BALANCE TOTAL REVENUES Transfer In - General Fund TOTAL TRANSFERS IN TOTAL EXPENDITURES & TRANSFERS EXCESS (DEFICIENCY) KEEP THE COLONY BEAUTIFUL Revenue & Expenditure Projections Fiscal Year 2024-2025 BEGINNING FUND BALANCE 27 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES 5,527,317 - - - - - 5,527,317 - - - TOTAL REVENUES & TRANSFERS 5,527,317 - - - TRANSFERS OUT - - 11,032,945 - - - - TOTAL TRANSFERS OUT - - 11,032,945 - - - 11,032,945 - 5,527,317 - (11,032,945) - 5,505,628 11,032,945 11,032,945 0 11,032,945 11,032,945 0 0 ENDING FUND BALANCE TOTAL REVENUES Transfer - Tax Debt Fund Transfer - Utility Fund TOTAL EXPENDITURES & TRANSFERS EXCESS (DEFICIENCY) BEGINNING FUND BALANCE Interest SLFRF Fund Revenue & Expenditure Projections Fiscal Year 2024-2025 SLFRF Revenue 28 2021-2022 2022-2023 2023-2024 2024-2025 Actual Actual Budget Budget REVENUES 264,960 - - - State Grant Revenue - - 264,960 - - - Transfer In - Community Development - 7,083,340 4,000,000 3,500,000 TOTAL REVENUES & TRANSFERS 264,960 7,083,340 4,000,000 3,500,000 EXPENDITURES Contractual Servics - - 150,000 - Maintenance 61,945 205,526 50,000 - Non-Capital - - 50,000 - Capital Outlay 909,885 1,659,244 3,500,000 - TOTAL EXPENDITURES 971,829 1,864,769 - 3,750,000 - - TRANSFERS OUT ---- Transfer - Parks Fund ---- TOTAL TRANSFERS OUT --- - 971,829 1,864,769 3,750,000 - (706,869)5,218,571 250,000 3,500,000 4,695,803 3,988,933 9,207,504 9,457,504 3,988,933 9,207,504 9,457,504 12,957,504 PARK IMPROVEMENTS FUND Revenue & Expenditure Projections Fiscal Year 2024-2025 Park Dedication Fees BEGINNING FUND BALANCE ENDING FUND BALANCE TOTAL REVENUES Transfer - General Fund TOTAL EXPENDITURES & TRANSFERS EXCESS (DEFICIENCY) 29 Department General Description 2025 PARD Dumpster Enclosure Expansion 31,590.00$ Public Works Waste Water Plant Precast Screening Wall 500,000.00$ Streets Mueller Equipment Barn 35,000.00$ Streets Sand Spreader Enclosure 50,000.00$ Facilities Maint.LED Lighting Upgrades 150,000.00$ Facility Maint.Community Center Roof 300,000.00$ Facility Maint.Fire Station 2 Roof 150,000.00$ Facility Maint.Foundation Repairs @ PD and City Hall 165,000.00$ Facility Maint.PD Courtroom Floor Replacement 9,000.00$ Facility Maint.Police Lobby Automatic Doors 50,000.00$ Facility Maint.Recreation Center Roof 240,000.00$ Fleet Additional Electical Outlets 8,000.00$ Total:1,688,590.00$ Dispatch Dallas Regional Warrant Interface 17,000.00$ Fleet Vehical Maintenance Software 45,000.00$ IT Access Control Systems 350,000.00$ IT Annes AV System 25,000.00$ IT Cell Phone Upgrades (61) 30,000.00$ IT Compliance Mnagement Software 44,000.00$ IT Enterprise Backup Solution 52,000.00$ IT Microsoft enterprise Agreement 150,000.00$ PARD VenTek Kiosk Card Reader Upgrade 34,500.00$ Police Axon Interview Room Camera System 65,000.00$ Police Flock Safety Cameras 39,250.00$ Police Power DMS Bundle 30,756.00$ Waste Water Security Camera's 50,000.00$ Police Brazos Zebra Ticket Writers/Printers 45,000.00$ Total:977,506.00$ Police K9 unit 47,000.00$ Police Grandscape Police Equipment 48,000.00$ Police Motorola Portable Radios (35)250,000.00$ Total:Total:345,000.00$ Emergency Svcs Outdoor Warning Sirens 127,500.00$ Fleet Brake Rotor Machine 12,000.00$ PARD Stage for Events & Concerts 313,534.00$ Animal Services Outdoor Dog Kennels 5,000.00$ Animal Services Dog Bowl Sanitizing Machine 7,500.00$ Capital Outlay & Special Maintenance Plan Summary FY24-25 Building Expansion, Renovation, & Maintenance Computers, Software & Hardware Emergency Vehicles & Equipment Equipment 30 Fleet Fuel Injector Cleaner 2,000.00$ Total:467,534.00$ Engineering ITS Detection Equipment 325,000.00$ Engineering Replace/Upgrade Traffic Signal Equipment 170,000.00$ Engineering School Zone Flashers 25,000.00$ Streets Husqvarna Walk Behind Saw 30,000.00$ Engineering AutoCad License Renewal 1,500.00$ Engineering Bridge Repair at Grandscape 300,000.00$ Engineering City Wide Street Pavement Lifting Surfaces 250,000.00$ Engineering Drainage Impact Fee Study 50,000.00$ Engineering Misc. Drainage & Erosion Repair Projects 400,000.00$ Engineering Pavement Condition Evaluation for Alleys 50,000.00$ Engineering Regional Detention Pond Evaluation (SW Utility Fund 50,000.00$ Engineering Roadway Impact Fee Study 50,000.00$ Engineering Stormwater Permit Consulting Assistance (SW Utility 50,000.00$ Engineering Street Lights 30,000.00$ Streets Barricades 20,000.00$ Total:1,801,500.00$ Engineering Ford F150 55,500.00$ Facilities Maint F250 w/ Ladder rack (3) 158,768.00$ Fire Divison Chief of Training Vehicle 79,726.00$ Fire Fire Admin Staff Vehicles (2) 159,452.00$ Fire Firefighting Drone 39,000.00$ Fire Incident Support Vehicle 50,000.00$ PARD John Deere Gator Model TE 4x2 18,700.00$ PARD Replace Unit #545E 27,000.00$ PARD Replace Unit #552 73,000.00$ Police Grandscape Police Vehicles (3) 285,000.00$ Police K9 Officer Vehicle 95,000.00$ Police Replacement Police Vehicles (6)450,000.00$ Storm Water Cat Skid Steer Loader 75,000.00$ Streets Backhone Loader 175,000.00$ Streets Dynamic Message Boards (5)110,000.00$ Streets Ford F-250 w/ Ladder Rack & Toolbox (2) 200,000.00$ Streets Ford F350 Super Cab w/ Asphalt Heater 140,000.00$ Utility Admin 2024 Ford Maverick (Unit #6135)34,400.00$ Utility Admin Ford F150 Trucks (Units #6136 & #6137) 105,294.00$ Waste Water Flatbed Attached Crane 30,000.00$ Waste Water Sludge Hauling Trailers (2)100,000.00$ Water Dist. Ford F550 4x4 100,000.00$ Water Dist. Ranger Pickup 27,055.00$ Water Dist.Sewer Camera Trailer 207,000.00$ Water Production Mobile Workshop Utility Trailer 20,500.00$ Streets Vehicles, Trailers, & Heavy Equipment 31 Water Production Replace Unit #6122 - Transit Cargo Van 83,425.00$ Total:2,898,820.00$ Waste Water Lift Station Aerators 27,000.00$ Water Dist.Line Locate Wand 13,860.00$ Water Production Connecting Water Facilities to City Network 150,000.00$ Water Production Disinfectant Equipment Well #4 56,500.00$ Water Production Paluxy Well Pump 105,000.00$ Water Production Paving Parking Area 46,000.00$ Water Production Public Works Radio Repeater 56,000.00$ Water Production Stage 1 of 2 Motor Control Center 807,537.00$ Water Production VFD Pump 178,500.00$ Engineering Water/Wastewater Master Plan & Impact Fee Study 150,000.00$ Total:1,590,397.00$ 9,769,347.00$ CDC Parks Master Plan Revision 100,000.00$ Total:100,000.00$ 9,869,347.00$ Combined Capital Outlay & Special Maintenance Grand Total: Capital Outlay & Special Maintenance Grand Total: Water & Wastewater Equipment & Projects Community Development Corporation 32 De p a r t m e n t Ge n e r a l D e s c r i p t i o n 20 2 5 20 2 6 20 2 7 20 2 8 20 2 9 To t a l : Fa c i l i t y M a i n t . An i m a l S h e l t e r E x p a n s i o n 35 0 , 0 0 0 . 0 0 - - - - 35 0 , 0 0 0 . 0 0 Fa c i l i t y M a i n t . Li b r a r y R e m o d e l 60 0 , 0 0 0 . 0 0 - - - - 60 0 , 0 0 0 . 0 0 Fa c i l i t y M a i n t . Re m o d e l C o m m u n i t y C e n t e r 22 0 , 0 0 0 . 0 0 - - - - 22 0 , 0 0 0 . 0 0 Fa c i l i t y M a i n t . PD R e l o c a t i o n a t C o m m C e n t e r 22 5 , 0 0 0 . 0 0 - - - - 22 5 , 0 0 0 . 0 0 Fa c i l i t y M a i n t . Re m o d e l T r i n i t y N o r t h B u i l d i n g 11 , 0 0 0 , 0 0 0 . 0 0 - - - - 11 , 0 0 0 , 0 0 0 . 0 0 PA R D St e w a r t C r e e k P a r k M a s t e r P l a n I m p v 55 0 , 0 0 0 . 0 0 55 0 , 0 0 0 . 0 0 55 0 , 0 0 0 . 0 0 50 0 , 0 0 0 . 0 0 - 2, 1 5 0 , 0 0 0 . 0 0 To t a l s : 12 , 9 4 5 , 0 0 0 . 0 0 55 0 , 0 0 0 . 0 0 55 0 , 0 0 0 . 0 0 50 0 , 0 0 0 . 0 0 - 14 , 5 4 5 , 0 0 0 . 0 0 Fi r e Fi r e S t a t i o n 3 A u x B u i l d i n g 51 7 , 9 9 0 . 0 0 - - - - 51 7 , 9 9 0 . 0 0 To t a l s : 51 7 , 9 9 0 . 0 0 - - - - 51 7 , 9 9 0 . 0 0 Fi r e Sq u a d 1 8 W e t R e s c u e F i r e A p p a r a t u s 1, 5 0 5 , 1 4 0 . 0 0 - - - 1, 5 0 5 , 1 4 0 . 0 0 To t a l s : 1, 5 0 5 , 1 4 0 . 0 0 - - - - 1, 5 0 5 , 1 4 0 . 0 0 En g i n e e r i n g Bi l l A l l e n S t r e a m B a n k S t a b a l i z a t i o n 35 0 , 0 0 0 . 0 0 - - - - 35 0 , 0 0 0 . 0 0 En g i n e e r i n g Ha v e n H i l l s & W a t e r s E d g e C o n n e c t o r 80 , 0 0 0 . 0 0 85 0 , 0 0 0 . 0 0 - - - 93 0 , 0 0 0 . 0 0 En g i n e e r i n g Me m o r i a l D r i v e W i d e n i n g 50 0 , 0 0 0 . 0 0 2, 0 0 0 , 0 0 0 . 0 0 5, 0 0 0 , 0 0 0 . 0 0 7, 0 0 0 , 0 0 0 . 0 0 5, 0 0 0 , 0 0 0 . 0 0 19 , 5 0 0 , 0 0 0 . 0 0 En g i n e e r i n g No r t h C o l o n y F l o o d i n g 17 5 , 0 0 0 . 0 0 20 0 , 0 0 0 . 0 0 - - - 37 5 , 0 0 0 . 0 0 En g i n e e r i n g Pa i g e R o a d C h a n n e l S t a b a l i z a t i o n 60 0 , 0 0 0 . 0 0 - - - - 60 0 , 0 0 0 . 0 0 En g i n e e r i n g Pl a n o P a r k w a y O u t f a l l D i s s i p a t o r 25 0 , 0 0 0 . 0 0 - - - - 25 0 , 0 0 0 . 0 0 En g i n e e r i n g Re s i d e n t i a l S t r e e t R e c o n s t r u c t i o n 6, 6 5 0 , 0 0 0 . 0 0 1, 8 5 0 , 0 0 0 . 0 0 - - - 8, 5 0 0 , 0 0 0 . 0 0 St r e e t s Ge n e r a l A l l e y w a y R e p a i r - L a r g e 1, 5 0 0 , 0 0 0 . 0 0 1, 5 0 0 , 0 0 0 . 0 0 1, 5 0 0 , 0 0 0 . 0 0 1, 5 0 0 , 0 0 0 . 0 0 1, 5 0 0 , 0 0 0 . 0 0 7, 5 0 0 , 0 0 0 . 0 0 St r e e t s Ge n e r a l A l l e y w a y R e p a i r - S m a l l 50 0 , 0 0 0 . 0 0 50 0 , 0 0 0 . 0 0 50 0 , 0 0 0 . 0 0 50 0 , 0 0 0 . 0 0 50 0 , 0 0 0 . 0 0 2, 5 0 0 , 0 0 0 . 0 0 St r e e t s Ge n e r a l S t r e e t R e p a i r - M u l t i - P a n e l 1, 5 0 0 , 0 0 0 . 0 0 3, 5 0 0 , 0 0 0 . 0 0 3, 5 0 0 , 0 0 0 . 0 0 3, 5 0 0 , 0 0 0 . 0 0 3, 5 0 0 , 0 0 0 . 0 0 15 , 5 0 0 , 0 0 0 . 0 0 En g i n e e r i n g Re s i d e n t i a l P C I D r i v e n C o n c r e t e R o a d R e p a 1, 0 0 0 , 0 0 0 . 0 0 1, 0 0 0 , 0 0 0 . 0 0 1, 0 0 0 , 0 0 0 . 0 0 1, 0 0 0 , 0 0 0 . 0 0 1, 0 0 0 , 0 0 0 . 0 0 5, 0 0 0 , 0 0 0 . 0 0 En g i n e e r i n g St r i c k l a n d D r a i n a g e P i p e R e p a i r s 85 0 , 0 0 0 . 0 0 - - - - 85 0 , 0 0 0 . 0 0 En g i n e e r i n g Tr i b u t e W a t e r P o n d i n g 20 0 , 0 0 0 . 0 0 20 0 , 0 0 0 . 0 0 20 0 , 0 0 0 . 0 0 - - 60 0 , 0 0 0 . 0 0 To t a l s : 14 , 1 5 5 , 0 0 0 . 0 0 11 , 6 0 0 , 0 0 0 . 0 0 11 , 7 0 0 , 0 0 0 . 0 0 13 , 5 0 0 , 0 0 0 . 0 0 11 , 5 0 0 , 0 0 0 . 0 0 62 , 4 5 5 , 0 0 0 . 0 0 En g i n e e r i n g Tr i b u t e W a t e r W e l l 1, 2 0 0 , 0 0 0 . 0 0 5, 0 0 0 , 0 0 0 . 0 0 4, 0 0 0 , 0 0 0 . 0 0 - - 10 , 2 0 0 , 0 0 0 . 0 0 En g i n e e r i n g Wa s t e w a t e r T r e a t m e n t P l a n t C M A R 5, 5 0 0 , 0 0 0 . 0 0 - - - - 5, 5 0 0 , 0 0 0 . 0 0 Fa c i l i t y M a i n t . Ba c k u p G e n e r a t o r E q u i p m e n t W e l l # 4 1, 0 0 8 , 0 0 0 . 0 0 - - - - 1, 0 0 8 , 0 0 0 . 0 0 To t a l s : 7, 7 0 8 , 0 0 0 . 0 0 - - - - 6, 5 0 8 , 0 0 0 . 0 0 CI P G r a n d T o t a l : 36 , 8 3 1 , 1 3 0 . 0 0 12 , 1 5 0 , 0 0 0 . 0 0 12 , 2 5 0 , 0 0 0 . 0 0 14 , 0 0 0 , 0 0 0 . 0 0 11 , 5 0 0 , 0 0 0 . 0 0 85 , 5 3 1 , 1 3 0 . 0 0 Co m p r e h e n s i v e I m p r o v e m e n t P l a n S u m m a r y FY 2 5 - 2 9 Bu i l d i n g E x p a n s i o n , R e n o v a t i o n , & M a i n t e n a n c e Co m p u t e r s , S o f t w a r e & H a r d w a r e Em e r g e n c y V e h i c l e s St r e e t s Wa t e r & W a s t e W a t e r 33 CD C Aq u a t i c P a r k U p g r a d e s 45 0 , 0 0 0 . 0 0 45 0 , 0 0 0 . 0 0 45 0 , 0 0 0 . 0 0 - - 1, 3 5 0 , 0 0 0 . 0 0 CD C Bi l l A l l e n P a r k E r o s i o n ( C D C P o r t i o n ) 50 0 , 0 0 0 . 0 0 - - - - 50 0 , 0 0 0 . 0 0 CD C At h l e t i c F a c i l i t y U p g r a d e s 85 0 , 0 0 0 . 0 0 85 0 , 0 0 0 . 0 0 85 0 , 0 0 0 . 0 0 85 0 , 0 0 0 . 0 0 - 3, 4 0 0 , 0 0 0 . 0 0 To t a l s : 1, 8 0 0 , 0 0 0 . 0 0 1, 3 0 0 , 0 0 0 . 0 0 1, 3 0 0 , 0 0 0 . 0 0 85 0 , 0 0 0 . 0 0 - 5, 2 5 0 , 0 0 0 . 0 0 Co m b i n e d C I P G r a n d T o t a l : 38 , 6 3 1 , 1 3 0 . 0 0 13 , 4 5 0 , 0 0 0 . 0 0 13 , 5 5 0 , 0 0 0 . 0 0 14 , 8 5 0 , 0 0 0 . 0 0 11 , 5 0 0 , 0 0 0 . 0 0 90 , 7 8 1 , 1 3 0 . 0 0 Co m b i n e d C I P G r a n d T o t a l 38 , 6 3 1 , 1 3 0 . 0 0 $ Co m b i n e d C a p i t a l O u t l a y T o t a l 9, 8 6 9 , 3 4 7 . 0 0 $ Gr a n d T o t a l C I P & C a p i t a l O u t l a y 48 , 5 0 0 , 4 7 7 . 0 0 $ FY 2 4 - 2 5 Co m m u n i t y D e v e l o p m e n t C o r p o r a t i o n 34 CITY OF THE COLONY DEBT MANAGEMENT POLICIES September 3rd, 2024 Prepared by the Finance Department Confirmed by the City Council on September 17th, 2024 35 DEBT MANAGEMENT POLICIES Table of Contents Page No. I. Purpose Statement 1 II. Responsibility 1 A. Bond Counsel Involvement 2 B. Financial Advisor Involvement III. Short Term Debt 2 A. General B. Commercial Paper C. Line of Credit IV. Long Term Debt 2 A. General 2 B. Bonds 3 C. Certificates of Obligation D. Public Property Finance Contractual Obligation E. Anticipation Notes 4 F. Negotiated versus Competitive Sale versus Private Placement G. Bidding Parameters 5 H. Bond Elections V. Refunding 5 VI. Capital Leasing 6 VII. Other Types of Financing 6 VIII. Ratios and Reserves 6 IX. Official Statement 7 A. Responsibility B. Timing C. Auditor’s Involvement 8 D. Printing X. Ratings 8 36 DEBT MANAGEMENT POLICIES Table of Contents Page No. XI. Credit Enhancements 9 XII. Secondary Market Disclosure 9 XIII. Arbitrage Liability Management 10 A. General B. Responsibility C. Internal Interim Financing 11 D. Spend-Out Exceptions For Federal Rebate XIV. Modification to Policies 12 37 I.PURPOSE The Debt Management Policies set forth comprehensive guidelines for the financing of capital expenditures. It is the objective of the policies that: 1. The City obtains financing only when necessary. 2. The process for identifying the timing and amount of debt or other financing is as efficient as possible. 3. The most favorable interest rates and lowest costs of issuance are obtained. 4. The City strives to maintain flexibility for future debt issuances. II. RESPONSIBILITY The primary responsibility for developing financing recommendations rests with the City Manager. In developing the recommendations, the City Manager shall be assisted by the Assistant City Manager and the Finance Director and their responsibilities shall be to: 1. Meet periodically to consider the need for financing and assess progress on the Capital Improvement Program. 2. Meet as necessary in preparation for financing. 3. Review changes in state and federal legislation. 4. Review annually the provisions of ordinances authorizing issuance of obligations. 5. Annually review services provided by the Financial Advisor, Bond Counsel, Paying Agent and other service providers to evaluate the extent and effectiveness of services provided. Every February, under the direction of the Assistant City Manager, Departments will submit Capital Projects for the Capital Improvement Program. The report shall be prepared by the Finance Director and be based in part on information from the department directors in the City and shall include a projection of near term financing needs compared to available resources, an analysis of the impact of contemplated financings on the property tax rate and user charges, and a financing recommendation. In developing financing recommendations, city management shall consider the following: 1. The amount of time proceeds of obligations are expected to remain on hand and the related carrying cost. 2. The options for interim financing including short term and interfund borrowing, taking into consideration federal and state reimbursement regulations. 3. The effect of proposed action on the tax rate and user charges. 4. Trends in interest rates. 5. Other factors as appropriate. 38 A.Bond Counsel Involvement The Bond Counsel will issue an opinion as to the legality and tax-exempt status of any obligations. The City will also seek the advice of Bond Counsel on all other types of financings and on any other questions involving federal tax or arbitrage law. The Bond Counsel is also responsible for the preparation of the ordinance authorizing issuance of obligations, and all of the closing documents to complete their sale and delivery, and will perform other services as defined by the contract approved by the City Council. B. Financial Advisor Involvement The City will seek the advice of the Financial Advisor when necessary. The Financial Advisor will advise on the structuring of obligations to be issued, informs the City of various options, advise the City as to how choices will impact the marketability of City obligations and will provide other services as defined by contract approved by the City Council. Financial Advisor will be able to bid on any City competitive debt issues if approval is given by the City. The Financial Advisor will inform the City Manager of significant issues. III. SHORT TERM DEBT A. General When appropriate, the city may consider short-term obligations. Some forms of short-term obligations can be obtained quicker than long-term obligations and thus can be used in emergencies until long-term financing can be obtained. In some cases when the amount of financing required in the immediate future is relatively small, it may be cheaper for the City to issue a small amount of short- term obligations to provide for its immediate needs, than to issue a larger amount of long-term obligations to provide financing for both immediate, and future needs when the carrying costs of issuing obligations, which are not immediately needed are taken into account. The amount of short-term obligations due to mature in a year shall not exceed 5% of the aggregate principal amount of outstanding long-term debt. IV. LONG TERM DEBT A. General Long-term obligations will not be used for operating purposes, and the life of the obligations will not exceed the useful life of the projects financed. 39 A resolution of intent to issue bonds or other debt obligations authorizing staff to proceed with preparations shall be presented for the consideration of the City Council when capital projects are identified. This provision may be waived in the event of emergencies or other good cause. Debt service structure will approximate level debt service unless operational matters dictate otherwise. The cost of issuance of private activity bonds is usually higher than for governmental purpose bonds. Consequently, private activity bonds will be issued only when they will economically benefit the City. The cost of taxable debt is higher than the cost of tax-exempt debt. However, the issuance of taxable debt is mandated in some circumstances, and may allow valuable flexibility in subsequent contracts with users or managers of the improvement constructed with the bond proceeds. Therefore, the City will usually issue obligations tax-exempt, but may occasionally issue taxable obligations. B.Bonds Long-term general obligation or revenue bonds may be issued to finance significant capital improvements. If required by state law or charter, an election will be held to authorize such obligations. Bonds will have a maximum repayment term of 25 years or less. When cost/beneficial, and when permitted under applicable ordinances, the City may consider the use of surety bonds, lines of credit, or similar instruments to satisfy reserve requirements. C.Certificates of Obligation Certificates of Obligation may be issued to finance permanent improvements, land acquisition, and other public purposes. The life of certificates of obligation issued to finance equipment shall match to the extent possible the useful life of the equipment, which is usually three to five years. Certificate of Obligations will be secured by a tax pledge and/or a revenue pledge, as required by law and as determined to be in the best interest of the City. Some revenues are restricted as to the uses for which they may be pledged. Water and wastewater revenues may be pledged without limit. D.Public Property Finance Contractual Obligation Public property finance contractual obligations may be issued to finance the acquisition of personal property. The life of the contractual obligations issued to finance personal property shall match the useful life of the personal property. 40 E.Anticipation Notes Anticipation Notes may be used to finance projects or acquisition that could also be financed with Certificates of Obligation. Anticipation Notes may be secured and repaid by a pledge of revenue, taxes, a combination of revenue and taxes or the proceeds of a future debt issue. Anticipation Notes are authorized by an ordinance adopted by the City. Anticipation Notes have several restrictions, which include: 1. Anticipation Notes issued for general purposes must mature before the seventh anniversary of the date the Attorney General approves the issue. 2. A governing body may not issue Anticipation Notes that are payable from bond proceeds unless the proposition authorizing the issuance of the bonds has already been approved by the voters and the proposition states that anticipation notes may be issued. F.Negotiated versus Competitive Sale versus Private Placement When feasible and economical, obligations shall be issued by competitive sale rather than negotiated sale. A sale may be negotiated when the issue is predominantly a refunding issue or in other non-routine situations, which require more flexibility than a competitive sale allows. In addition, market volatility may necessitate a negotiated sale. Whenever the option exists to offer an issue either for competitive sale or for negotiated sale, analysis of the options shall be performed to aid in the decision making process. When a sale is not competitively bid, the City will participate with the Financial Advisor in the selection of the underwriter or direct purchaser. The criteria used to select a winning bidder in a competitive sale shall be the true interest cost. In a negotiated sale, the underwriter may be selected through a request for proposals (RFP). The criteria used to select an underwriter in a negotiated sale should include the following: 1. Overall experience 2. Marketing philosophy 3. Capability 4. Previous experience with the City as managing or co-managing underwriter 5. Financial Statement 6. Public Finance team and resources 7. Breakdown of underwriter’s discount a. Management fee – compensation to the underwriter for their work in structuring the issue. b. Underwriting fee – compensation to the underwriter for using their capital to underwrite the bonds. 41 c. Average takedown – the portion of the underwriter’s discount used to pay the sales force. d. Expenses – administrative costs such as underwriter’s counsel and administrative fees. In a negotiated underwriting, the sale will be, to the extent appropriate, negotiated with a consortium of underwriting firms, to preserve some of the benefits of competition. When cost/beneficial, the City may privately place its debt. Since no underwriter participates in a private placement, it may result in lower cost of issuance. Private placement is sometimes an option for small issues. The opportunity may be identified by the Financial Advisor. G.Bidding Parameters The notice of sale will be carefully constructed to ensure the best possible bid for the City, in light of existing market conditions and other prevailing factors. Parameters to be examined include: 1. Limits between lowest and highest coupons 2. Coupon requirements relative to the yield curve 3. Method of underwriter compensation, discount or premium coupons 4. Use of true interest cost (TIC) versus net interest cost (NIC) 5. Use of bond insurance 6. Deep discount bonds 7. Variable rate bonds 8. Call provisions H.Bond Elections Before a bond election, the City Manager and City Councilmembers will be provided with competent debt capacity analyses, tax and user fee impact projections and other information as directed by the City Manager’s Office. The Bond Counsel and Financial Advisor will provide support during the process. V.REFUNDING The City shall consider refunding debt whenever an analysis indicates the potential for present value savings or the city’s needs to restructure its debt payments. As a general rule, private activity bonds may be refunded in a current refunding only. 42 VI.CAPITAL LEASING Capital leasing is an option for the acquisition of a piece or package of equipment costing less than $1,000,000. Leasing shall not be considered when funds are on hand for the acquisition unless the interest expense associated with the lease is less than the interest that can be earned by investing the funds on hand or when other factors such as budget constraints or vendor responsiveness override the economic consideration. Whenever a lease is arranged with a private sector entity, a tax-exempt rate shall be sought. Whenever a lease is arranged with a government or other tax-exempt entity, the City shall strive to obtain an explicitly defined taxable rate so that the lease will not be counted in the City’s total annual borrowings subject to arbitrage rebate. The lease agreements shall permit the City to refinance the lease at no more than reasonable cost should the City decide to do so. A lease, which can be called at will, is preferable to one, which can merely be accelerated. Since the market for lease financings is relatively inefficient, the interest rates available at any one time may vary widely. Therefore, the City shall attempt to obtain at least three competitive proposals for any major lease financing. The net present value of competitive bids shall be compared; taking into account whether payments are in advance or in arrears, and how frequently, payments are made. The purchase price of equipment shall be competitively bid as well as the financing cost. The advice of the City’s Bond Counsel shall be sought in any leasing arrangement and when federal tax forms 8038 are prepared to ensure that all federal tax laws are obeyed. The City may consider issuing certificates of participation to finance a very large project. Care should be taken because financing costs may be greater than for other types of financing. When possible, the lease agreement will be backed with a tax pledge. If the City is obligated to make payment, more than a year in the future then the agreement will probably be considered debt by the State. However, if the payments are subject to annual appropriation by the City Council, then they may not. VII.OTHER TYPES OF FINANCING From time to time, other types of financing may become available. Examples of these options are debt pools with other entities and low-interest loans from State Agencies such as the Texas Water Development Board. The Finance Director will prepare a written analysis of an option, with the advice of the City’s Bond Counsel and Financial Advisor. VIII.RATIOS AND RESERVES The portion of the City’s property tax levied for debt service shall not exceed 40% of the total tax rate levied each year even though the Texas Attorney General’s Office, in its 43 review of bonds or other obligations secured by Ad Valorem Taxes, generally imposes a limit of $1.50 for debt service for cities with a $2.50 maximum tax rate. However, the City is obligated to levy an Ad Valorem Tax sufficient to provide for the timely payments of its debt obligations secured by Ad Valorem Taxes. The City will maintain net revenues equaling to at least 1.10 times the maximum annual principal and interest requirement and 1.25 times the average annual principal and interest requirements of all parity bonds outstanding in the Water and Wastewater Fund. For water and sewer, and other types of revenue bonds, the bond documents will designate the reserve fund amount if a reserve fund is to be established. When revenue supported debt is issued, a debt service reserve or similar alternative may be established. The requirements for and source of the reserve will be determined on a case-by-case basis. IX.OFFICIAL STATEMENT The Official Statement is the disclosure document prepared by or on behalf of the City for an offering of securities. A.Responsibility The preparation of the Official Statement is the responsibility of the Finance Director with the help of the Financial Advisor. Information for the Official Statement is gathered from departments/divisions throughout the City. B.Timing The Finance Director will begin assembling the information needed to update the Official Statement before the offering of debt. Audited financial statement information is expected in March. As soon as it is available, audited financial statement information and capital budget information will be incorporated. If the next anticipated bond sale is expected to be more than twelve months after fiscal year end, then the prior year’s audited financial statement information may be updated using unaudited figures. The Financial Advisor shall begin preparing the Official Statement at least eight weeks prior to an anticipated bond issuance. Subsequent timing will generally be as follows: 1. The first draft of the preliminary Official Statement takes approximately 2 weeks to create. 2. Copies of the first draft are provided to the City’s Bond Counsel and City Staff, who will review it for 2 weeks. In the case of a negotiated sale, the underwriter’s counsel will also be asked for comments. 44 3. Comments from reviewers should be submitted during the two-week review period. About 1 week will be required to make the requested changes. After they have been made, the Official Statement is either sent to print or subjected to a second review. 4. During the printing process or the second review, a copy of the draft Official Statement is sent to the rating agencies for their review. 5. The preliminary Official Statement should be completed and mailed or electronically distributed to underwriters 2 weeks prior to the bond sale date. The preliminary document will be titled “preliminary” with red printed disclosure language and will be called a “red herring”. 6. After interest rates have been accepted by the City Council, the final Official Statement must be prepared and distributed to the underwriter within seven business days of the date of sale. C.Auditor’s Involvement The City will include a review of its Official Statement in the contract for services with its external auditor if required. D.Printing The Financial Advisor may print the Official Statement for the City. X.RATINGS The City’s goal is to maintain or improve its bond ratings. To that end, prudent financial management policies will be adhered to in all areas. Full disclosure of operations will be made to the bond rating agencies. The City staff, with the assistance of the Financial Advisor and Bond Counsel, will prepare the necessary materials for presentation to the rating agencies. The City may choose to use Fitch Ratings, Moody’s or Standard and Poor’s. The City shall maintain a line of communications with those rating agencies (Moody’s, Standard and Poor’s, or Fitch), informing them of major financial events in the City as they occur. The Comprehensive Annual Financial Report shall be distributed to the rating agencies after it has been accepted by the City Council. The rating agencies will also be notified either by telephone or through written correspondence when the City begins preparation for a debt issuance. After the initial contact, a formal ratings application will be prepared and sent along with the draft of the Official Statement relating to the bond sale to the rating agencies. This application and related documentation should be sent several weeks prior to the bond sale to give the rating agencies sufficient time to perform their review. 45 A personal meeting with representatives of the rating agencies will be scheduled every few years or whenever a major project is initiated. XI.CREDIT ENHANCEMENTS Credit enhancements are mechanisms that guarantee principal and interest payments. They include bond insurance and a line or letter of credit. Credit enhancement will usually bring a lower interest rate on debt and a higher rating from the rating agencies, thus lowering overall costs. During debt issuance planning, the Financial Advisor will advise the City whether or not a credit enhancement is cost effective under the circumstances and what type of credit enhancement, if any, should be purchased. In a negotiated sale, bids will be taken during the period prior to the pricing of the sale. In a competitive sale, the bidder may purchase bond insurance if the issue qualifies for bond insurance. XII.SECONDARY MARKET DISCLOSURE SEC 15c2-12 regulations became effective July 3, 1995. The new regulation requires municipal debt issuers to provide specified financial and operating information for fiscal years beginning on January 1, 1996, or later. The information provided should mirror the information provided in an official statement at the time of a primary offering. The annual financial information is to be sent to all Nationally Recognized Municipal Information Depositories (NRMSIRs) designated by the SEC. Additionally, issuers must notify the State Information Depositories (SIDs) if one exists. In addition to the financial and operating information, any material event must be provided to all NRMSIRs, Municipal Securities Rulemaking Board (MSRB) and to the state SID’s. Municipal debt issuers will be obligated to provide ongoing disclosure on the status of the following material events: 1. Principal and interest payment delinquencies 2. Non-payment-related defaults 3. Unscheduled draws on reserves 4. Unscheduled draws on credit enhancements 5. Substitution of credit or liquidity providers, or the failure to perform 6. Adverse tax opinions or events affecting the tax-exempt status of the security 7. Modifications to rights of security holders 8. Bond calls 9. Defeasances 10. Matters affecting collateral 11. Rating changes The Finance Director will be designated “Compliance Officer” for disclosure requirements. Levels of reporting will include: 46 1. Notification by certified mail to NRMSIRs, and SID’s of material events, with copies to the City Council 2. Copies of CAFR and updated tables from the Official Statement to NRMSIRs and SIDs within six months of fiscal year end. XIII.ARBITRAGE LIABILITY MANAGEMENT It is the City’s policy to minimize the cost of arbitrage rebate and yield restrictions while strictly complying with the law. A.General Federal arbitrage legislation is intended to discourage entities from issuing tax- exempt obligations unnecessarily. In compliance with the spirit of this legislation, the City will not issue obligations except for identifiable projects with very good prospects of timely initiation. Obligations will be issued as closely in time as feasible to the time contracts are expected to be awarded so that they will be spent quickly. B.Responsibility Because of the complexity of arbitrage rebate regulations and the severity of non- compliance penalties, the advice of Bond Counsel and other qualified experts will be sought whenever questions about arbitrage rebate regulations arise. The City contracts outside consultants for arbitrage rebate services. The Accounting Manager will be responsible for identifying the amount of unspent debt proceeds including interest which is on hand and will be responsible for ensuring that, to the extent feasible, the oldest proceeds on hand are spent first. The consultants will maintain a system for computing and tracking the arbitrage rebate liability. The consultants will notify the City within 60 days of year-end of the amount of accrued liability. The consultants will also be responsible for notifying the City two months in advance of when a rebate of excess arbitrage earnings is due to the Internal Revenue Service. The City’s Bond Counsel and Financial Advisor may be requested to review in advance any arbitrage rebate payments and forms sent to the Internal Revenue Service. The expenditure of obligation proceeds will be tracked in the financial accounting system by type of issue. Investments will be pooled for financial accounting purposes and may, at the discretion of the Finance Director, be pooled for investment purposes. When investments of bond proceeds are co-mingled with other investments, the City shall adhere to the Internal Revenue Service rules on accounting allocations. 47 Arbitrage rebate costs shall be charged as negative interest revenue to the funds in which the related obligation proceeds were originally deposited. C.Internal Interim Financing In order to defer the issuance of obligations, when sufficient non-restricted reserve funds are on hand, consideration shall be given to appropriating them to provide interim financing for large construction contracts or parts of contracts. When the appropriations are subsequently re-financed with proceeds of obligations or other resources, the non-restricted reserve funds shall be repaid. When expenditures are reimbursed from debt issuances, applicable state law and the Internal Revenue Service rules on reimbursements will be complied with so that the reimbursements may be considered expenditures for arbitrage purposes. Requirements are in general: 1. The City shall declare its intention to reimburse expenditure with debt proceeds before paying the expenditure, and will exclude cost of issuance. 2. Reimbursement bonds must be issued and the reimbursement made within eighteen months after the expenditure was made or the property financed by the expenditure was placed in service, whichever is later. 3. The expenditure to be reimbursed must be a capital expenditure. D.Spend-Out Exceptions For Federal Rebate Arbitrage rebate regulations provide certain spending exceptions to the imposition of Federal rebate obligations. One such safe harbor applies to obligations issued for construction if certain rules are adhered to and the proceeds are spent within two years. Other such exceptions apply to expenditures of proceeds within 6 months or eighteen months. These options should be considered when circumstances indicate the City will with certainty be successful in achieving a spend-out goal. Such circumstances may include, but are not limited to the following: 1. Obligations are issued to finance a variety of small construction projects, not large projects that might be unexpectedly delayed after the issuance. In addition, project management understands the requirements and is firmly committed to achieving the spend-out goal. 2. Obligations are issued for a single, large high priority project with a relatively short construction period and there is a high level of commitment to speedy completion. When the two-year spend-out option is elected, debt will be issued for an estimated one year of expenditures to provide for unexpected delays of up to a year without incurring penalties. 48 The exercise of the spend-out options will always be coordinated with Bond Counsel and the Financial Advisor. The city shall coordinate with Bond Counsel and the Financial Advisor regarding the proper elections to be made in connection therewith. XIV.MODIFICATIONS TO POLICIES Management staff will review these policies annually and significant changes may be made with the approval of the City Manager. Significant policy changes will be presented to the City Council for confirmation. 49 CITY OF THE COLONY FINANCIAL MANAGEMENT POLICIES SEPTEMBER 3rd, 2024 Prepared by the Finance Department Confirmed by the City Council on September 17th, 2024 50 FINANCIAL MANAGEMENT POLICIES Table of Contents Page No. I. Purpose Statement 1 II. Accounting, Auditing and Financial Reporting 1 A. Accounting B. Funds C. External Auditing D. External Auditors Responsible to City Council E. External Auditors Rotation 2 F. External Financial Reporting G. Internal Financial Reporting III Internal Controls 2 A. Written Procedures B. Department Managers Responsible IV. Operating Budget 2 A. Preparation B. Balanced Budget 3 C. Planning D. Reporting E. Control F. Performance Measures and Productivity Indicators V. Capital Improvement Program 3 A. Preparation B. Control C. Program Planning D. Alternate Resources E. Debt Financing 4 F. Street Maintenance G. Water/Wastewater Main Rehabilitation and Replacement H. Water and Wastewater Special Projects I. Reporting 51 FINANCIAL MANAGEMENT POLICIES Table of Contents Page No. VI. Revenue Management 4 A. Simplicity B. Certainty C. Equity 5 D. Administration E. Revenue Adequacy F. Cost/Benefit of Abatement G. Diversification and Stability H. Non-recurring Revenues I. Property Tax Revenues J. User-Based Fees K. Impact Fees L. General and Administrative Charges 6 M. Utility Rates N. Interest Income O. Revenue Monitoring VII. Expenditure Control 6 A. Appropriations B. Contingency Account Expenditures C. Purchasing D. Professional Services E. Prompt Payment F. Equipment Financing 7 G. Information Technology VIII. Asset Management 7 A. Investments B. Cash Management C. Fixed Assets and Inventory 52 FINANCIAL MANAGEMENT POLICIES Table of Contents Page No. IX. Financial Condition and Reserves 7 A. No Operating Deficits B. Interfund Loans C. Operating Reserves 8 D. Risk Management Program 9 E. Loss Financing F. Enterprise Fund Self-Sufficiency X. Debt Management 9 A. General B. Self-Supporting-Debt C. Analysis of Financing Alternatives D. Voter Authorization XI. Staffing and Training 9 A. Adequate Staffing B. Training C. Awards, Credentials 10 XII. Grants Financial Management 10 A. Grant Solicitation B. Responsibility XIII. Annual Review & Reporting 10 53 I. PURPOSE STATEMENT These policies are developed by the City Manager to guide the Finance Director, and staff in financial matters. The overriding goal of the Financial Management Policies is to enable the City to achieve a long-term stable and positive financial condition while conducting its operations consistent with the council-manager form of government established in the City Charter. The watchwords of the City’s financial management include integrity, prudent stewardship, planning, accountability, and full disclosure. The purpose of the Financial Management Policies is to provide guidelines for the financial management staff in planning and directing the City’s day-to-day financial affairs and in developing recommendations to the City Manager. The scope of the policies spans accounting, auditing, financial reporting, internal controls, operating and capital budgeting, revenue management, cash management, expenditure control, and debt management. II. ACCOUNTING, AUDITING, AND FINANCIAL REPORTING A. ACCOUNTING – The City’s Assistant Finance Director is responsible for establishing the chart of accounts, and for properly recording financial transactions. B. FUNDS - Self-balancing groups of accounts are used to account for City financial transactions in accordance with generally accepted accounting principles. Each fund is created for a specific purpose except for the General Fund, which is used to account for all transactions not accounted for in other funds. Funds are created and fund names are changed by City Council approval through resolution either during the year or in the City Council’s approval of the annual operating budget ordinances. C. EXTERNAL AUDITING – The City will be audited annually by outside independent auditors. The auditors must be a CPA firm capable to demonstrate that they have the breadth and depth of staff to conduct the City’s audit in accordance with generally accepted auditing standards, generally accepted government auditing standards, and contractual requirements. The auditors’ report on the City’s financial statements including federal grants single audit when required, will be completed within 120 days of the City’s fiscal year end, and the auditors’ management letter will be presented to the City staff within 150 days after the City’s fiscal year end. An interim management letter will be issued prior to this date if any materially significant internal control weaknesses are discovered. The City staff and auditors will jointly review the management letter with the City Council within 60 days of its receipt by the staff. D. EXTERNAL AUDITORS RESPONSIBLE TO CITY COUNCIL – The external auditors are accountable to the City Council and will have access to direct communication with the City Council if the City staff is unresponsive to auditor recommendations or if the auditors consider such communication necessary to fulfill their legal and professional responsibilities. 54 The City Council may conduct closed session annually with the auditors present without the presence of City staff. Such meeting shall be conducted in accordance with the Open Meetings Act. E. EXTERNAL AUDITOR ROTATION – The City will not require external auditor rotation, but will circulate requests for proposal for audit services periodically, normally at five-year intervals. F.EXTERNAL FINANCIAL REPORTING – The City will prepare and publish a Comprehensive Annual Financial Report (CAFR). The CAFR will be prepared in accordance with generally accepted accounting principles, and will be presented annually to the Government Finance Officers Association (GFOA) for evaluation and awarding of the Certification of Achievement for Excellence in Financial Reporting. The CAFR will be published and presented to the City Council within 120 days after the end of the fiscal year. City staffing limitations may preclude such timely reporting. In such case, the Finance Director will inform the City Manager and the City Manager will inform the City Council of the delay and the reasons therefore. G. INTERNAL FINANCIAL REPORTING -The Finance Department will prepare internal financial reports sufficient for management to plan, monitor, and control the City’s financial affairs. Internal financial reporting objectives are addressed throughout the policies. III. INTERNAL CONTROLS A. WRITTEN PROCEDURES – The Finance Director is responsible for developing citywide written guidelines on accounting, cash handling, and other financial matters, which will be approved by the City Manager. The Finance Department will assist department directors as needed in tailoring these guidelines into detailed written procedures to fit each department’s requirements. B. DEPARTMENT MANAGERS RESPONSIBLE – Each department director is responsible to the City Manager to ensure that good internal controls are followed throughout his or her department, that all guidelines on accounting and internal controls are implemented, and that all independent auditor internal control recommendations are addressed. IV. OPERATING BUDGET A. PREPARATION – The City’s “Operating Budget” is the City’s annual financial operating plan. It consists of governmental and proprietary funds, including the general obligation and revenue supported Debt Service Funds, but excluding Capital Projects Funds. The budget is prepared by the Finance Department with the cooperation of all City departments, and is submitted to the City Manager who makes any necessary changes and transmits the document to the City Council. 55 The preliminary budget should be filed with the City Secretary’s office on or before July 31st each fiscal year, and presented to the City Council. Thereafter, the final budget should be enacted by the City Council prior to fiscal year end. The operating budget shall be submitted to the GFOA annually for evaluation and awarding of the Award for Distinguished Budget Presentation. B. BALANCED BUDGET – The operating budgets will be balanced, with current revenues, and prior year surpluses greater than or equal to current expenditures/expenses except a rainy day fund reserve of sixty (60) days. C. PLANNING – The budget process will be coordinated to identify major policy issues for City Council’s consideration several months prior to the budget approval date. D. REPORTING – Periodic financial reports will be prepared to enable the department directors to manage their budgets and to enable the Finance Department to monitor and control the budget as authorized by the City Council. Summary financial reports will be presented to the City Council each month within four weeks after the month end. Such reports will include current year revenue and expenditures in comparison to budget and prior year actual revenues and expenditures. E. CONTROL – Operating Expenditure Control is addressed in another section of the Policies. F. PERFORMANCE MEASURES AND PRODUCTIVITY INDICATORS – Where appropriate, performance measures and productivity indicators will be used as guidelines and reviewed for efficiency and effectiveness. This information will be included in the annual budgeting process. V. CAPITAL IMPROVEMENT PROGRAM A. PREPARATION – The City’s Capital Improvement Program will include all capital projects. The Capital Improvement Plan will be prepared annually on a fiscal year basis. The Capital Improvement Plan will be reviewed annually by the City Council. The Capital Improvement Plan will be prepared by the Finance Department with the involvement of all City departments. B. CONTROL – All capital project expenditures must be approved by City Council. The Finance Department must ensure the availability of resources before a capital project contract is presented by the City Manager to the City Council for approval. C. PROGRAM PLANNING – The Capital Improvement Plan will include capital improvements program plans for future years. The planning time frame should normally be at least five years. The replacement and maintenance for capital items should also be projected for the next 5 years. Future maintenance and operations will be fully costed, so that these costs can be considered in the operating budget. 56 D. ALTERNATE RESOURCES – Where applicable, assessments, impact fees, or other user- based fees should be used to fund capital projects, which have a primary benefit to certain property owners. E. DEBT FINANCING – Recognizing that debt is usually a more expensive financing method, alternative financing sources will be explored before debt is issued. When debt is issued, it will be used to acquire major assets with expected lives, which equal or exceed the average life of the debt issued. The exceptions to this requirement are the traditional costs of marketing and issuing the debt, capitalized labor for design and construction of capital projects, and small component parts which are attached to major equipment purchases. F. STREET MAINTENANCE – The City recognizes that deferred street maintenance increases future capital costs by an estimated 5 to 10 times. Therefore, a portion of the General Fund Budget and/or debt issuances may be set aside each year to maintain the quality of streets. The amount will be established annually so that repairs will be made. G. WATER/WASTEWATER MAIN REHABILITATION AND REPLACEMENT – The City recognizes that deferred water/wastewater main rehabilitation and replacement increases future costs due to loss of potable water from water mains and inflow and infiltration into wastewater mains. Therefore, to ensure that the rehabilitation and replacement program is adequately funded, the City may annually appropriate an amount to provide for a water and wastewater main repair and replacement program. H. WATER AND WASTEWATER SPECIAL PROJECTS – A special fund will be maintained for water and wastewater capital projects. The fund will be funded with operating surpluses, interest earnings, and transfers from water and wastewater operations. As soon as practicable, after each fiscal year end when annual operating results are known, any Water/Wastewater Fund operating surplus in excess of budget which is not required to meet ending resources requirements, may be transferred to the Special Projects Fund with the approval of the City Council. The fund will be used for funding water/wastewater main rehabilitation and replacement, for major capital outlay, and for unplanned projects. I. REPORTING – Periodic financial reports will be prepared to enable the department managers to manage their capital budgets and to enable the Finance Department to monitor the capital budget as authorized by the City Council. VI. REVENUE MANAGEMENT A. SIMPLICITY – The City will strive to keep the revenue system simple, which will result in a decrease of compliance costs for the taxpayer or service recipient and a corresponding decrease in avoidance to pay. The City will avoid nuisance taxes, fees, or charges as revenue sources. B. CERTAINTY – An understanding of the revenue source increases the reliability of the revenue system. The City will enact consistent collection policies for its revenues so 57 that assurances can be provided that the revenue base will materialize according to budgets and plans. C. EQUITY – The City will strive to maintain equity in the revenue system structure. That is, the City will seek to minimize or eliminate all forms for subsidization between entities, funds, services, utilities, and customers. However, it is recognized that public policy decisions may lead to subsidies in certain circumstances, e.g., senior citizen property tax exemptions or partial property tax abatement. D. ADMINISTRATION – The benefits of revenue will exceed the cost of producing the revenue. The cost of collection will be reviewed annually for cost effectiveness. Where appropriate, the City will use the administrative processes of State or Federal collection agencies in order to reduce administrative costs. E. REVENUE ADEQUACY – The City will require that there be a balance in the revenue system. That is, the revenue base will have the characteristic of fairness and neutrality as it applies to cost of service, willingness to pay, and ability to pay. F. COST/BENEFIT OF ABATEMENT – The City will use due caution in the analysis of any tax, fee, or water and wastewater incentives that are used to encourage development. Ideally, a cost/benefit (fiscal impact) analysis will be performed as a part of such analysis. G. DIVERSIFICATION AND STABILITY – In order to protect the government from fluctuations in revenue source due to fluctuations in the economy, and variations in weather, (in the case of water and wastewater), a diversified revenue system will be maintained. H. NON-RECURRING REVENUES – One-time revenues will not be used for ongoing operations. Non-recurring revenues will be used only for non-recurring expenditures. Care will be taken not to use these revenues for budget balancing purposes. I. PROPERTY TAX REVENUES – Property shall be assessed at 100% of the fair market value as appraised by the Denton Central Appraisal District. Reappraisal and reassessment shall be done regularly as required by State law. All delinquent taxes will be aggressively pursued, with delinquents greater than 150 days being turned over to the City Attorney or a private attorney, and a penalty assessed to compensate the attorney as allowed by state law, and in accordance with the attorney’s contract. J. USER-BASED FEES – For services associated with a user fee or charge, the direct and indirect costs of that service will be offset by a fee where possible. There will be a periodic review of fees and charges to ensure that fees provide adequate coverage of costs of services. User charges may be classified as “full cost recovery,” “partial cost recovery,” and “minimal cost recovery,” based upon City Council policy. 58 K. IMPACT FEES – Impact fees are currently imposed for water, wastewater, roadway, and drainage in accordance with applicable city ordinances and State Law. Impact fees will be re-evaluated at least every five years as required by law. L. GENERAL AND ADMINISTRATIVE CHARGES – A method will be maintained whereby the General Fund can impose a charge to the enterprise funds or special revenue funds for general and administrative services (indirect costs), performed on their behalf. The details will be documented in the annual budget process in the form of transfers between funds. M. UTILITY RATES – The City will review utility rates periodically, and if necessary, adopt new rates that will generate revenues required to fully cover operating expenditures, meet the legal restrictions of all applicable bond covenants, provide for an adequate level of working capital needs and debt service requirements. This policy does not preclude drawing down cash balance to finance current operations. However, it is best that any extra cash balance be used instead to finance capital projects. N. INTEREST INCOME – Interest earned from investment of available monies, whether pooled or not, will be distributed to the funds in accordance with the average monthly cash balances. O. REVENUE MONITORING – Revenues actually received will be regularly compared to budgeted revenues and variances will be investigated. This process will be summarized in the appropriate budget report. VII. EXPENDITURE CONTROL A. APPROPRIATIONS – The level of budgetary control is the department level in the General Fund, Parks Fund, and Utility Fund and the fund level in all other funds. When budget adjustments (i.e., amendments) between departments and/or funds are necessary, these must be approved by the City Council. Budget appropriation amendments at lower levels of control shall be made in accordance with the applicable administrative procedures. B. CONTINGENCY ACCOUNT EXPENDITURES – The City Council must approve all contingency account expenditures of $50,000 or more, as discussed under Purchasing. C. PURCHASING – All purchases shall be in accordance with the City’s Purchasing Policies. D. PROFESSIONAL SERVICES – Professional services will generally be processed through a request for proposal process, except for smaller contracts. The City Manager may execute any professional services contract for less than $50,000 provided there is an appropriation for such contract. E. PROMPT PAYMENT – All invoices will be paid within 30 days of receipt of goods and services or receipt of invoices, whichever is later in accordance with the prompt 59 payment requirements of state law. Procedures will be used to take advantage of all purchase discounts where considered cost effective. However, payments will also be reasonably delayed in order to maximize the City’s investable cash, where such delay does not violate the agreed upon payment terms. F. EQUIPMENT FINANCING – Equipment may be financed when the useful life is at least three years. Vehicles to be replaced are identified and evaluated every year during the budget process. Depending on available resources, financing may be made by debt issuance rather than from the General Fund and Utility Fund accounts. G. INFORMATION TECHNOLOGY – Certain information technology acquisitions will be funded in the Information Technology Department’s budget or by debt issuance. Acquisitions may include all related professional services costs for researching and/or implementing an information technology project. Lease cost is also an eligible expense. VIII. ASSET MANAGEMENT A. INVESTMENTS – The City’s investment practices will be conducted in accordance with the City Council approved Investment Policies. B. CASH MANAGEMENT – The City’s cash flow will be managed to maximize the cash available to invest. A monthly report is provided by the Finance Director to the Assistant City Manager for presentation to the City Council. C. FIXED ASSETS AND INVENTORY – These assets will be reasonably safeguarded and properly accounted for, and prudently insured. IX. FINANCIAL CONDITION AND RESERVES A. NO OPERATING DEFICITS – Current expenditures will be paid with current revenues and prior year surplus. Deferrals, short-term loans, or one-time sources will be avoided as budget balance techniques. Reserves will be used only for emergencies or non-recurring expenditures, except when balances can be reduced because their levels exceed guideline minimums. B. INTERFUND LOANS - Non-routine interfund loans shall be made only in emergencies where other temporary sources of working capital are not available and with the approval of the City Council. At the time an interfund loan is considered, a plan to repay it prior to fiscal year end shall also be considered. A fund will only lend money that it will not need to spend in the immediate future. A loan may be made from a fund only if the fund has ending resources in excess of the minimum requirement for the fund. Total interfund loans outstanding from a fund shall not exceed 15% of the target fund balance for the fund. If any interfund loan is to be repaid from the proceeds of a future debt issue, a proper reimbursement resolution will be approved at the time the loan is authorized. 60 C. OPERATING RESERVES – in accordance with GASB-54, it is the policy of the City of The Colony to classify fund balances as Non-spendable, Restricted, Committed, Assigned, or Unassigned and develop policy for establishment and activity of each classification. Non-spendable fund balance is (a) not in a spendable form such as prepaid items or (b) legally or contractually required to be maintained intact as an endowment. Restricted fund balance consists of amounts that can be spent only on the specific purposes stipulated by law or by the external providers of those resources. Committed fund balances are self-imposed limitations set in place prior to the end of the fiscal year. These amounts can be used only for specific purposes determined by a formal action of the City Council and require the same level of formal action to remove the constraint. Assigned fund balance consists of amounts that are subject to a purpose constraint that represents an intended use established by the City Council. The purpose of the assignment must be narrower than the purpose of the General Fund. Additionally, this category is used to reflect the appropriation of a portion of existing fund balance to eliminate a projected deficit in the subsequent year’s budget. Unassigned fund balance represents the residual classification of fund balance and includes all spendable amounts not contained within other classifications. Restricted, Committed, and Assigned fund balance expenditures require prior Council approval. (1) Policy on Committing Funds: It is the policy of the City of The Colony that fund balance amounts will be reported as “Committed Fund Balance” only after formal action and approval by City Council. The action to constrain amounts in such a manner must occur prior to year-end; however, the actual dollar amount may be determined in a subsequent period. After approval by the City Council, the amount reported a Committed Fund Balance cannot be reversed without Council approval. (2) Policy of Assigning Funds: Funds that are intended to be used for a specific purpose but have not received the formal approval by Council may be recorded as Assigned Fund Balance. It is the policy of the City of The Colony that fund balance amounts will be reported as “Assigned Fund Balance” only after the City Manager has assigned those amounts based on intentions for use of the City Council. (3) Policy on Unassigned General, Parks, and Utility Fund balances: It is the goal of the City to achieve and maintain an unassigned General Fund, Parks Fund, and Utility Fund balance equal to 60 days of expenditures. The required minimum fund balance of 60 days of expenditures is to provide working capital needs in emergencies. The 60 days fund balance is considered as committed fund balance in the General Fund and is approved by the City Council via the resolution adopting this policy. To the extent reasonably possible, in the event that the General fund balance is drawn down below the target level, it will be replenished by the following fiscal year. 61 (4) Order of fund expenditure When multiple categories of fund balance are available for expenditure, the City will first spend the most restricted category of funds. Normally, this will result in the use of committed, then restricted, and lastly, unassigned fund balances. Failure to meet these standards will be disclosed to the City Council as soon as the situation is recognized and a plan to replenish the ending resources over a reasonable time frame shall be adopted. D.RISK MANAGEMENT PROGRAM – The City will aggressively pursue every opportunity to provide for the public’s and City employees’ safety and to manage its risks. D.LOSS FINANCING – All reasonable options will be investigated to finance losses. Such options may include risk transfer, insurance, and risk retention. E.ENTERPRISE FUND SELF-SUFFICIENCY – The City’s enterprise funds resources will be sufficient to fund operating and capital expenditures. The enterprise funds will pay (where applicable) their fair share of general and administrative expenses in lieu of property taxes and/or franchise fees. If an enterprise fund is temporarily unable to pay all expenses, then the City Council may waive general and administrative expenses in lieu of property taxes and/or franchise fees until the fund is able to pay them. X. DEBT MANAGEMENT A.GENERAL – The City’s borrowing practices will be conducted in accordance with the City Council approved Debt Management Policies. B.SELF-SUPPORTING DEBT - When appropriate, self-supporting revenues will pay debt services in lieu of tax revenues. C.ANALYSIS OF FINANCING ALTERNATIVES – The City will explore all financing alternatives in addition to long-term debt including leasing, grants and other aid, developer contributions, impact fees, and use of reserves or current monies. D.VOTER AUTHORIZATION – The City shall obtain voter authorization before issuing General Obligation Bonds as required by law. In general, voter authorization is not required for the issuance of Revenue Bonds and Certificates of Obligation. XI. STAFFING AND TRAINING A.ADEQUATE STAFFING – Staffing levels will be adequate for the fiscal functions of the City to function effectively. Workload shedding alternatives will be explored before adding staff. B.TRAINING - The City will support the continuing education efforts of all financial staff including the investment in time and materials for maintaining a current perspective concerning financial issues. Staff will be held accountable for communicating, 62 teaching, and sharing with other staff members all information and training materials acquired from seminars, conferences, and related education efforts. C.AWARDS, CREDENTIALS – The City will support efforts and involvements which result in meeting standards and receiving exemplary recitations on behalf of any of the City’s fiscal policies, practices, processes, products, and personnel. Staff certifications may include Certified Public Accountant, Certified Management Accountant, Certified Internal Auditor, Certified Payroll Professional, Certified Government Finance Officer, Professional Public Buyer, Certified Cash Manager, and others as approved by the City Manager upon recommendation of the Finance Director. XII. GRANTS FINANCIAL MANAGEMENT A.GRANT SOLICITATION – The City will stay informed about available grants and will apply for any, which would be cost/beneficial and meet the City’s objectives. B.RESPONSIBILITY – Departments will oversee the day to day operations of grant programs, will monitor performance and compliance, and will also keep Finance Department contacts informed of significant grant-related plans and activities. Departments will also report re-estimated annual grant revenues and expenses to the Finance Department after the second quarter of each year. Finance Department staff members will serve as liaisons with grantor financial management personnel, and will keep the book of accounts for all grants. XIII. ANNUAL REVIEW & REPORTING A. These Policies will be reviewed administratively by the City Manager at least annually, and will be presented to the City Council for confirmation of any significant changes. B. The Finance Director will report annually to the City Council on compliance with these policies. 63 CITY OF THE COLONY THE COLONY ECONOMIC DEVELOPMENT CORPORATION THE COLONY COMMUNITY DEVELOPMENT CORPORATION INVESTMENT POLICY September 3rd, 2024 Prepared by the Finance Department Confirmed by the City Council on September 17th, 2024 64 THE COLONY INVESTMENT POLICY TABLE OF CONTENTS PAGE I. SCOPE OF POLICY 1 A. Funds Included 1 B. Funds Excluded 1 C. Pooling of Funds 1 D. Additional Requirements 1 II. PRUDENCE 1 III. OBJECTIVES OF POLICY 2 A. Safety 2 B. Liquidity 2 C. Public Trust/Transparency 2 D. Yield 2 IV. RESPONSIBILITY AND CONTROL 3 A. Delegation 3 B. Investment Officers 3 C. Conflicts of Interest 3 D. Disclosure 3 E. Investment Training 3 V. AUTHORIZED INVESTMENTS 4 VI. INVESTMENT REPORTS 4 VII. PORTFOLIO AND INVESTMENT ASSET PARAMETERS 4 A. Bidding Process for Investments 4 B. Maximum Maturities 5 C. Maximum Dollar-Weighted Maturity 5 D. Diversification 5 E. Performance Standards 5 VIII. SELECTION OF DEPOSITORY, BROKER/DEALERS, AND INVESTMENT ADVISORS 6 A. Depository Solicitation Process 6 B. Insurability 6 C. Investment Advisors 6 IX. COLLATERALIZATION 6 A. Insurance or Collateral Pledged 6 B. Collateral Defined 6 C. Audit of Pledged Collateral 7 65 PAGE X. SAFEKEEPING AND CUSTODY OF INVESTMENT ASSETS 7 XI. MANAGEMENT AND INTERNAL CONTROLS 7 XII. INVESTMENT POLICY ADOPTION 8 XIII. INVESTMENT STRATEGY 8 A. Operating Funds 9 APPENDIX A Authorized Government Pools 9 66 THE COLONY INVESTMENT POLICY I. SCOPE OF POLICY This Investment Policy shall govern the investment activities of all funds of the City of The Colony, The Colony Economic Development Corporation, and The Colony Community Development Corporation (collectively herein referred to as “THE COLONY”), excluding any specific funds cited hereafter. This Policy serves to satisfy the state statutory requirement to define and adopt a formal investment policy. A. FUNDS INCLUDED: All financial assets of all current funds of THE COLONY and any new funds created in the future, unless specifically exempted, will be administered in accordance with this Policy. These funds are accounted for in the City’s Annual Financial Report and may include: General Fund, Enterprise Funds, Capital Project Funds, Special Revenue Funds, Trust and Agency Funds. B. FUNDS EXCLUDED: This Policy excludes Employee Retirement and Pension Funds administered or sponsored by THE COLONY and excludes bond funds held in trust escrow accounts. THE COLONY will maintain responsibility for these funds as required by Federal and State law and Charters and Codes. C. POOLING OF FUNDS: Except for cash in certain restricted and special funds, THE COLONY will consolidate cash balances from all funds to optimize potential investment earnings. Investment income will be allocated to the various funds based on their respective percentage participation and in accordance with the generally accepted accounting principles. D. ADDITIONAL REQUIREMENTS: In addition to this Policy, bond funds (to include capital project, debt service, and reserve funds) will be managed by the governing debt ordinance and the provisions of the Internal Revenue Code applicable to the issuance of tax-exempt obligations and the investment of debt proceeds. II. PRUDENCE Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of the capital as well as the probable income to be derived. The standard of prudence to be used by Investment Officers shall be the “prudent person” standard and shall be applied in the context of managing an overall portfolio of funds, rather than a consideration as to the prudence of a single investment. Investment Officers acting in accordance with written procedures and this Investment Policy and exercising due diligence shall be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported in a timely fashion to the City Manager, and the City Council, and appropriate action is taken by the 67 Investment Officers and their oversight managers to control adverse developments in accordance with the terms of this Policy. III. OBJECTIVES OF POLICY The primary objectives of THE COLONY’s investment program in order of priority shall be preservation and safety of principal, liquidity, public trust, and yield. A. SAFETY: The foremost and primary objective of THE COLONY’s investment program is the preservation and safety of capital. Each investment transaction will seek first to ensure that capital losses are avoided, whether the loss occurs from the default of a security or from erosion of market value. The objectives will be to mitigate credit risk and interest rate risk. To control credit risk, investments should be limited to the safest types of investments. Financial institutions, broker/dealers and advisors who serve as intermediaries, shall be pre-qualified by THE COLONY. The credit ratings of investment pools and individual securities will be monitored to assure compliance with this Policy and State law. To control interest rate risk, THE COLONY will structure the investment portfolio so that investments mature to meet cash requirements for ongoing operations and will regularly monitor marketable securities. Should an issuer experience a downgrade of its credit rating by a nationally recognized credit rating agency below the required minimum rating, all prudent measures will be taken to liquidate the investment. B. LIQUIDITY: THE COLONY’s investment portfolio will remain sufficiently liquid to enable THE COLONY to meet operating requirements that might be reasonably anticipated. Liquidity will be achieved by maintaining adequate cash equivalent balances, matching investment maturities with forecasted cash flow funding requirements, and by diversifying maturities. Furthermore, since all possible cash demands cannot be anticipated, the portfolio, or portions thereof may be placed in bank accounts, money market mutual funds or local government investment pools, which offer same day liquidity. C. PUBLIC TRUST/TRANSPARENCY: Investment Officers shall seek to act responsibly as the custodians of public trust. Investment Officers shall avoid any transaction that might impair public confidence in THE COLONY’s ability to govern effectively. To increase public trust and transparency, the Investment Policy will limit investments to those easily understood. Investments are limited to money market accounts of the Depository Bank and local governmental investment pools, and certificates of deposit of up to 1 year in maturity as described below in section V. Authorized Investments. D. YIELD: THE COLONY’s investment portfolio will be designed with the objective of regularly meeting or exceeding the optimum rate of return of a reasonable benchmark considering the risk, liquidity, and transparency constraints. Investment Officers will seek to preserve principal, maintain liquidity levels needed, maintain as much transparency as possible and optimize the yield of these funds. 68 However, it is understood that if the yield achieved by THE COLONY is higher than the arbitrage yield, positive arbitrage income will be rebated to the federal government as required by current federal regulations. IV. RESPONSIBILITY AND CONTROL A. DELEGATION: The Director of Finance has oversight management responsibility to establish written procedures and controls for the operation of the investment program, consistent with this Investment Policy. Such procedures shall include explicit delegation of authority to persons responsible for the daily cash management operation, execution of investment transactions, overall portfolio management, and investment reporting. The Director of Finance shall be responsible for all transactions undertaken, and shall establish a system of controls to regulate the activities of the Investment Officers. B. INVESTMENT OFFICERS: The Director of Finance and Assistant Finance Director are the “Investment Officers” of THE COLONY. No person shall engage in an investment transaction except as provided under the terms of this Policy and the procedures established by the Director of Finance. C. CONFLICTS OF INTEREST: Investment Officers and employees involved in the investment process will refrain from personal business activity that could conflict with proper execution and management of the investment program, or which could impair their ability to make impartial investment decisions. Investment Officers and employees involved in the investment process shall refrain from undertaking personal investment transactions with the same individual with whom business is conducted on behalf of THE COLONY. D. DISCLOSURE: Investment Officers shall disclose to the City Manager, City Council, Boards of Directors, and the Texas Ethics Commission any financial interests in financial institutions or any relationship within the second degree by affinity or consanguinity to an individual that conducts business with THE COLONY. All Investment Officers shall further disclose any large personal financial investment positions that could be related to the performance of THE COLONY’s portfolio. Investment Officers shall subordinate their personal investment transactions to those of this jurisdiction, particularly with regard to the timing of purchases and sales. E. INVESTMENT TRAINING: In order to ensure qualified and capable investment management, the Director of Finance, the Assistant Finance Director, and any other Investment Officers shall have a finance, accounting, or related degree and knowledge of treasury functions. Additionally, Investment Officers must attend investment training not less than once in a two-year period that begins on the first day of the fiscal year and consists of two consecutive fiscal years after that date and receive not less than 10 hours of instruction relating to investment responsibilities. This investment training may be from educational seminars held by Government Finance Officers Association (GFOA), 69 Government Treasurers Organization of Texas (GTOT), Government Finance Officers Association of Texas (GFOAT), American Institute of Certified Public Accountants (AICPA), University of North Texas (UNT), North Central Texas Council of Governments (NCTCOG), and Texas Municipal League (TML). All Investment Officers of THE COLONY shall attend at least one training session relating to their cash management and investment responsibilities within 12 months after assuming these duties for THE COLONY. Training must include education in investment controls, security risks, strategy risks, market risks, and compliance with state investment statutes. V. AUTHORIZED INVESTMENTS Funds of THE COLONY may be invested in the following investments, as authorized by Chapter 2256 of the Government Code of the State of Texas, known as the “Public Funds Investment Act”, and as authorized by this Investment Policy. Investments not specifically listed below are not authorized: A. Money Market Mutual Funds of Local Government Joint Investment Pools established and operating in compliance with the Public Funds Investment Act, and are continuously rated no lower than AAA-m or an equivalent rating by at least one nationally recognized rating service, have a dollar-weighted average maturity of 60 days or less, and invest only in obligations listed in the Public Funds Investment Act. B. Money Market Deposit accounts with bank depository. C. Certificates of Deposits that are issued by a state or national bank that has its main office or branch office in the State of Texas and that a) which are guaranteed or insured by the Federal Deposit Insurance Corporation, b) are secured in compliance with Section IX Collateralization, or c) are executed through a depository institution that has its main office or a branch office in this State that participates in the Certificate of Deposit Account Registry Service (CDARS) and meet the requirements of the Public Funds Investment Act. D. Insured Cash Shelter Accounts executed through a trustee bank that has its main office or a branch office in this State. Only those investments specifically listed in this Policy are authorized. VI. INVESTMENT REPORTS The Director of Finance shall submit quarterly an investment report in compliance with the Public Funds Investment Act. This report will be prepared in a manner, which will allow THE COLONY to ascertain whether investment activities during the reporting period have conformed to the Investment Policy. The report should be provided to the City Council, Boards of Directors, and the City Manager. The reports shall be formally reviewed at least annually by an independent auditor in conjunction with the annual audit. The result of the review shall be reported to the City Council and Boards of Directors by that auditor. The quarterly investment report must be presented within 90 days of the end of the quarter reporting period. The Director of Finance is responsible for the recording of investment transactions and the maintenance of the investment records with reconciliation of the accounting records of investments carried out by the Assistant Finance Director. Information to maintain the investment 70 program and the reporting requirements is derived from various sources such as broker/dealer research reports, newspapers, financial on-line market quotes, communication with broker/dealers, government investment pools, and financial consulting services. VII. PORTFOLIO AND INVESTMENT ASSET PARAMETERS A. BIDDING PROCESS FOR INVESTMENTS: Investment Officers for THE COLONY shall solicit bids or quotes for certificates of deposit, or other financial institution deposit accounts either orally, in writing, electronically, or in any combination of these methods. The Investment Officers will strive to create a competitive pricing environment for all portfolio transactions. B. MAXIMUM MATURITIES: THE COLONY will manage its investments to meet anticipated cash flow requirements. THE COLONY will not directly invest in certificate of deposits maturing more than one year from the date of purchase. C. MAXIMUM DOLLAR-WEIGHTED AVERAGE MATURITY: The maximum dollar-weighted average maturity based on the stated final maturity, authorized by this Investment Policy for the composite portfolio of THE COLONY, shall be 9 months. D. DIVERSIFICATION: It is the Policy of THE COLONY to diversify its investment portfolios. Assets held in each investment portfolio shall be diversified to eliminate the risk of loss resulting from concentration of assets in a specific maturity or specific issuer. In establishing specific diversification strategies, the following general policies and constraints shall apply: 1) CD maturities and shall be staggered in a way that protects interest income from the volatility of interest rates and that avoids undue concentration of assets in a specific maturity or Institution. Investments shall be selected which provide for stability of income and adequate liquidity. E. PERFORMANCE STANDARDS: The investment portfolio will be managed in accordance with the objectives specified within this Policy. 71 VIII. SELECTION OF DEPOSITORY, BROKER/DEALERS, AND INVESTMENT ADVISORS A. DEPOSITORY SOLICITATION PROCESS: Primary depositories shall be selected through THE COLONY’s banking services procurement process, which shall include a formal request for proposal (RFP) issued not less than every five years. In selecting primary depositories, the credit worthiness of institutions shall be considered. No public deposit shall be made except in a qualified public depository as established by state depository laws. THE COLONY may also establish agreements with other financial institutions under separate contract for additional services which are necessary in the administration, collection, investment, and transfer of municipal funds. Such deposits will only be made after the financial institution has completed and returned the required written instruments and depository pledge agreements. B. INSURABILITY: Banks seeking to establish eligibility for THE COLONY’s deposits, shall submit financial statements, evidence of federal insurance, and other information as required by the Investment Officers of THE COLONY. C. INVESTMENT ADVISORS: Investment Advisors shall adhere to the spirit, philosophy and specific term of this Policy and shall advise within the same “Standard of Care”. Selected Investment Advisors must be registered under the Investment Advisors Act of 1940 or with the State Securities Board. A contract with an Investment Advisor may not be for a term longer than two years and must be approved by the City Council, including any renewals or extensions. IX. COLLATERALIZATION A. INSURANCE OR COLLATERAL PLEDGED: Collateralization shall be required on depository bank deposits and certificates of deposit, in accordance with the “Public Funds Collateral Act” and depository laws. With the exception of deposits secured with irrevocable letters of credit at 100% of amount, the collateralization level will not be less than 102% of market value of principal and accrued interest, less any FDIC insurance. Evidence of the pledged collateral shall be documented by a tri-party custodial or a master repurchase agreement with the eligible collateral pledged clearly listed in the agreement. Collateral shall be monitored at least monthly to ensure that the market value of the securities pledged equals or exceeds the related deposit or investment balance. B. COLLATERAL DEFINED: THE COLONY shall only accept, as depository or investment collateral, letters of credit issued by the FHLB or investments stipulated by the Federal Treasury Office of the Comptroller of the Currency, Title 12 - Banks and Banking, Paragraph 9.11. 72 C. AUDIT OF PLEDGED COLLATERAL: All collateral shall be subject to verification and audit by the Director of Finance. X. SAFEKEEPING AND CUSTODY OF INVESTMENT ASSETS All security transactions, including collateral for repurchase agreements, entered into by THE COLONY shall be conducted using the delivery vs. payment (DVP) basis. That is, funds shall not be wired or paid until verification has been made that the correct security has been received by the safekeeping bank. The safekeeping bank is responsible for matching up instructions from THE COLONY’s Investment Officers on an investment settlement with what is wired from the broker/dealer, prior to releasing THE COLONY’s designated funds for a given purchase. The security shall be held in the name of THE COLONY or held on behalf of THE COLONY in a bank nominee name. Securities will be held by a third party custodian designated by the Director of Finance and evidenced by safekeeping receipts. The safekeeping bank’s records shall assure the notation of THE COLONY’s ownership of or explicit claim on the securities. The original copy of all safekeeping receipts shall be delivered to THE COLONY. A safekeeping agreement must be in place, which clearly defines the responsibilities of the safekeeping bank. Wires or ACH transactions to and from government investment pools, financial institution deposits, and money market mutual funds are the only exceptions to the DVP method of settlement. XI. MANAGEMENT AND INTERNAL CONTROLS The Director of Finance shall establish a system of internal controls which shall be designed to prevent losses of public funds arising from fraud, employee error, misrepresentation by third parties, unanticipated changes in financial markets, or imprudent actions by employees or Investment Officers of THE COLONY. Controls and managerial emphasis deemed most important that shall be employed where practical are: A. Control of collusion. B. Separation of duties. C. Separation of transaction authority from accounting and record keeping. D. Custodian safekeeping receipts records management. E. Avoidance of bearer-form securities. F. Clear delegation of authority. G. Documentation of investment bidding events. H. Written confirmations from broker/dealers and financial institutions. I. Reconcilements and comparisons of security receipts with the investment records. 73 J. Compliance with investment policies. K. Accurate and timely investment reports as required by law and this Policy. L. Validation of investment maturity decisions with supporting cash flow data. M. Adequate training and development of Investment Officers. N. Verification of all investment income and security purchase and sell computations. O. Review of financial condition of all broker/dealers, and depository institutions. P. Information about market conditions, changes, and trends that require adjustments in investment strategies. The above list of internal controls represents only a partial list of a system of internal controls. In conjunction with the annual audit, a process of independent review by an external auditor shall be established. XII. INVESTMENT POLICY ADOPTION THE COLONY’s Investment Policy shall be adopted by resolution of the City Council and Boards of Directors. The Policy and general investment strategy statements shall be reviewed on an annual basis by the City Council and Boards of Directors, and any modifications made thereto must be approved by them. XIII. INVESTMENT STRATEGY Effective investment strategy development coordinates the primary objectives of THE COLONY’s Investment Policy and cash management procedures. Cash management to increase the available “investment period” will be employed when necessary to enhance the ability of THE COLONY to earn interest income. Maturity selections shall be based on cash flow and market conditions to take advantage of interest rate cycles. THE COLONY’s portfolio shall be designed and managed in a manner responsive to the public trust and consistent with the Investment Policy. Each major fund type has varying cash flow requirements and liquidity needs. Therefore specific strategies shall be implemented considering the Fund’s unique requirements. THE COLONY funds shall be analyzed and invested according to the following major fund types: A. Operating Fund B. Capital Project Funds and Special Purpose Funds C. Debt Service Funds D. Bond Reserve Funds 74 OVERALL STRATEGY: THE COLONY’s basic investment strategy is to utilize investment options that represent suitable risk/return alternatives for excess operating reserves which are easily understood by the public. Therefore, investment of excess operating funds shall seek to preserve principal and promote transparency by restricting authorized investment instruments to those investments which are easily understood with suitable and limited credit and market risk. Liquidity will be maintained by utilizing projected cash flow needs to limit investment maturities and targeting minimum cash balances. Investment marketability will be maintained based on the fund-type strategies to sufficiently and reasonably assure that investments could be liquidated prior to the maturity, if cash needs dictate. THE COLONY shall also diversify its investment portfolio. Whenever practical, assets held in the investment portfolio shall minimize the risk of loss resulting from concentration of assets in a specific maturity or specific issuer. THE COLONY will group investment instruments into “fund-type investment groups.” These groups will reflect similar needs as to maturity limits, diversity, and liquidity. THE COLONY funds shall seek to achieve a competitive yield appropriate for each strategy. Yield objectives shall at all times be subordinate to the objectives of safety, liquidity and transparency. Tax-exempt debt proceeds shall be invested to optimize the interest earnings retained by THE COLONY, while at the same time fully complying with all applicable State laws and federal regulations, including the arbitrage rebate regulations. A. OPERATING FUNDS: Operating Funds shall have as their primary objective to assure safety of principal. The secondary objective is to assure that anticipated cash outflows are matched with adequate investment liquidity. The secondary objective is to create a portfolio structure, which will experience minimal volatility during changing economic cycles. Objectives may be accomplished by investing in money market accounts of the depository bank or government investment pools or bank certificates of deposits. APPENDIX A AUTHORIZED LOCAL GOVERNMENT INVESTMENT POOLS TEXPOOL/TEXPOOL PRIME (Texas Local Government Investment Pools) LOGIC (Local Government Investment Cooperative) TEXASTERM/TEXASDAILY (Local Government Investment Pools) 75 CITY OF THE COLONY, TEXAS ORDINANCE NO. 2024 - ________ ADOPT MUNICIPAL BUDGET FOR FISCAL YEAR 2024-2025 AN ORDINANCE OF THE CITY OF THE COLONY, APPROVING AND ADOPTING A BUDGET FOR THE CITY FOR THE FISCAL YEAR BEGINNING OCTOBER 1, 2024, THROUGH SEPTEMBER 30, 2025; PROVIDING FOR THE INTRA AND INTER-DEPARTMENT FUND TRANSFERS; PROVIDING THAT EXPENDITURES FOR SAID FISCAL YEAR SHALL BE MADE IN ACCORDANCE WITH SAID BUDGET; AND DECLARING AN EFFECTIVE DATE. WHEREAS,the Executive Director of Administration for the City of The Colony, Texas has heretofore filed with the City Secretary, a proposed general budget for the City covering the fiscal year 2024-2025; and WHEREAS, a public hearing was duly held and all interested persons were given an opportunity to be heard for or against any item therein in accordance with the Charter. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS: SECTION 1:That the attached budget, presented by the City Manager and reviewed during Council meetings and work sessions, and as amended be approved for the fiscal year 2024-2025. SECTION 2:That the City Manager be and is hereby authorized to make intra and Council approved inter-departmental fund transfers during the fiscal year as becomes necessary in order to avoid over-expenditures of a particular account. SECTION 3:That said Budget as attached hereto as Exhibit “A” of this Ordinance, and made a part hereof for all purposes, is hereby approved in all respects and is adopted as the City’s budget for the fiscal year beginning October 1, 2024, and ending September 30, 2025. SECTION 4:The fact that the fiscal year begins on October 1, 2024, requires that this Ordinance be effective upon its passage and adopted to preserve the public peace, property, health and safety, and shall be in full force and effect from and after its passage and adoption. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS THIS 17th DAY OF SEPTEMBER 2024. __________________________________ Richard Boyer, Mayor City of The Colony, Texas 2 ATTEST: __________________________________ Tina Stewart, TRMC, CMC, City Secretary APPROVED AS TO FORM: Jeffrey L. Moore, City Attorney 1775.016\874945.7 City of The Colony Public Improvement District No. 1 Annual Preliminary Service and Assessment Plan Update (Assessment Year October 1, 2024 to September 30, 2025) Approved by City Council on September 3nd, 2024 The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 2 1775.016\874945.7 SECTION 1 INTRODUCTION Unless otherwise defined, all capitalized terms used in this "City of The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update (Assessment Year October 1, 2024 to September 30, 2025)" (this "SAP Update") shall have the meanings set forth in that certain City of The Colony Public Improvement District No. 1 Amended and Restated Service and Assessment Plan, originally approved on February 7, 2013, recorded in the real property records of Denton County, Texas as Document No. 2013-20487, and as updated and most recently amended, restated, and consolidated on January 19, 2021 (the "Service and Assessment Plan") by Ordinance No. 2021-2430 adopted by the City Council on January 19, 2021. Unless otherwise defined, all references to "Section" mean a section of this SAP Update, and all references to "Exhibit" mean an exhibit to this SAP Update. 1.1 On October 8, 2012, the City Council of the City of The Colony, Texas (the "City Council" and the "City") passed and approved Resolution No. 2012-073 creating The Colony Public Improvement District No. 1 (the "District") pursuant to Chapter 372, Texas Local Government Code, as amended (the "Act"). The District includes within its boundaries approximately 439.12 contiguous acres located within the corporate limits of the City south of and adjacent to the Sam Rayburn Tollway (State Highway 121), north of and adjacent to Plano Parkway, and west of Spring Creek Parkway which property is described by metes and bounds on Exhibit A and depicted on Exhibit A-1 (the "Property"). 1.2 The Act governs the process by which the Public Improvements Cost is allocated to and assessed against the Property. This process requires the preparation of an ongoing service plan (a "Service Plan"), an assessment plan (an "Assessment Plan"), and an assessment roll (an "Assessment Roll"). 1.3 The Act requires the preparation, and the presentment to, and review and approval by, the City Council, of a Service Plan that must: (1) cover a period of at least five years; (2) define the annual indebtedness and projected costs of the Public Improvements; and (3) include a copy of the notice form required by Section 5.014 of the Texas Property Code, as amended. The Service Plan must be reviewed and updated at least annually to determine the annual budget for the Public Improvements. The City Council may approve the Service Plan only by Ordinance; and, upon approval, a copy of the Service Plan must be filed with the County Clerk of Denton County, Texas, the County in which all of the District is located, not later than the seventh (7th) day after the date of such approval. The Service Plan is contained in Section 4. 1.4 The Act requires the Service Plan to include an Assessment Plan. The Assessment Plan assesses the Public Improvements Cost against the Property on the basis of the special benefits conferred upon the Property by the Public Improvements. The Public Improvements Cost may be assessed in any manner that results in imposing equal shares of the cost on Parcels similarly benefited. The special benefit of the Public Improvements is being apportioned by this Service and Assessment Plan to the Property in the amount of the Public Improvements Cost. The Assessment Plan is contained in Section 5. The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 3 1775.016\874945.7 1.5 The Act also requires the City Council to review and update the Service Plan annually for the purpose of determining the annual budget for the Public Improvements. The annual budget for the Public Improvements is contained in Section 6. The Act states that the Service Plan may be amended or updated only by Ordinance. Upon approval of an amendment or update of the Service Plan, including the notice form required by Section 5.014 of the Texas Property Code, as amended, the City Council shall file a copy of the amended or updated Service Plan with the County Clerk of Denton County, Texas, the County in which all of the District is located, not later than the seventh (7th) day after the date of such approval. 1.6 The Act requires the preparation of an Assessment Roll after the total Public Improvements Cost has been determined. The Assessment Roll must state the assessment against each Parcel determined by the method of assessment chosen by the City Council in the Assessment Plan. The assessment against a Parcel must be sufficient to pay the share of the Public Improvements Cost allocated to the Parcel and cannot exceed the special benefit conferred upon the Parcel. The Assessment Roll is contained in Section 7. 1.7 A summary of the chronological history of City Council actions for the District is attached as Exhibit F. SECTION 2 2013 FACILITY PUBLIC IMPROVEMENTS 2.1 The portion of the Property described as Grandscape Addition Lot 1/Block A consisting of 81.99 acres and identified as Denton Central Appraisal District ("Denton CAD") Tax Parcel No. 657618, and the portion of the Property described as Grandscape Additional Lot 2/Block A consisting of 25.48 acres and identified by Denton CAD Tax Parcel No. 657619 (collectively, the "Facility Property") is developed with a mixed-use facility which includes approximately 1,280,000 square feet for warehouse and distribution uses, approximately 25,000 square feet for a regional corporate headquarters, approximately 546,000 square feet for retail sales to the general public and surface and structured parking (collectively, the "Facility"). The development of the Facility Property required construction of the 2013 Public Improvements that specially benefit the Facility Property. 2.2. In connection with the 2013 Project Infrastructure Bonds to finance a portion of the costs of the 2013 Public Improvements, the City approved the Original Service and Assessment Plan for the District by adopting the 2013 Assessment Ordinance on February 7, 2013. The 2013 Assessment Ordinance levied an Assessment in the amount of $83,400,000.00 (the "2013 Facility Public Improvement Assessment") against the Facility Property for the portion of the 2013 Public Improvements Cost that the City Council determined conferred a special benefit on the Facility Property. As authorized by the Act, the 2013 Assessment Ordinance deferred the assessment of the remainder of the 2013 Public Improvements Cost in the amount of $11,400,000.00 for the portion of the 2013 Public Improvements that specially benefit the Related Development Property (the "2013 Related Development Deferred Assessment") until the portion of the Related Development Property that is specially benefited by the 2013 Public Improvements could be identified. The 2013 Assessment Ordinance also deferred the assessment of the Related Development Public Improvements Cost against the Related Development Property until the portion(s) of the Related Development Property that are specially benefited by the Related The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 4 1775.016\874945.7 Development Public Improvements could be identified. As described below, the City has levied and intends to continue levying Additional Facility Assessments against the Facility Property for costs of Additional Facility Public Improvements (that do not include the 2013 Public Improvements) and has levied and intends to continue levying Assessments against the Related Development Property for a portion of the costs of the Related Development Public Improvements (that do not include the 2013 Public Improvements). 2.3 The 2013 Facility Public Improvements have been constructed by or on behalf of the Corporations using, in part, the net proceeds of the 2013 Project Infrastructure Bonds. The 2013 Facility Public Improvements fall into the following categories: (i) water, wastewater, and drainage facilities or improvements, including sanitary sewer facilities, storm water detention and retention facilities, and utility relocations related to such improvements; (ii) street and roadway improvements, including related traffic signalization, signage, sidewalks, curbs, gutters, streetscape, landscaping, drainage improvements, and utility relocations related to such street and roadway improvements; (iii) mass transit facilities; (iv) park improvements, (v) landscaping; (vi) lighting and signage; (vii) pedestrian malls; and (viii) site improvements for any of the foregoing, including, but not limited to, grading, erosion control, wetlands mitigation, and floodplain reclamation. The 2013 Public Improvements are more particularly described in the engineering report titled PUBLIC IMPROVEMENTS REPORT, The City of The Colony Public Improvement District No. 1, The Colony, Texas dated November 30, 2012, prepared by Graham Associates, Inc. (the "2013 Official Report"), a copy of which report is attached as Exhibit B to the Service and Assessment Plan. All 2013 Facility Public Improvements, and portions of the Property on which the 2013 Facility Public Improvements have been constructed, will remain owned by the City. 2.4 The 2013 Facility Public Improvement Assessment was pledged, on a pro-rata basis (based on the par amount of each series of 2013 Project Infrastructure Bonds issued as a percentage of the total par amount of all 2013 Project Infrastructure Bonds), as additional security for each series of 2013 Project Infrastructure Bonds in the event of a Debt Service Shortfall. Assessment Revenue generated from the 2013 Facility Public Improvement Assessment, if collected by the City in the event of Debt Service Shortfall, that is pledged to pay Debt Service Shortfall for any one series of the 2013 Project Infrastructure Bonds is not pledged to pay Debt Service Shortfalls for any other series of 2013 Project Infrastructure Bonds. In connection with each series of 2013 Project Infrastructure Bonds, each respective issuer of the 2013 Project Infrastructure Bonds entered into a reimbursement agreement relating to each respective series of 2013 Project Infrastructure Bonds (such agreements are referred to collectively as the "2013 Reimbursement Agreements"). On January 19, 2021, the City issued its 2021 LGC Tax Refunding Bonds that refunded all of the outstanding 2013 LGC Tax Bonds; and, the City entered into a 2021 LGC Tax Bonds Reimbursement Agreement relating to the 2021 LGC Tax Refunding Bonds. The 2021 LGC Tax Bonds Reimbursement Agreement pledged the portion of the 2013 Facility Public Improvement Assessments previously allocated to the 2013 LGC Tax Bonds to the 2021 LGC Tax Refunding Bonds and replaced the 2013 LGC Tax Bonds Reimbursement Agreement in its entirety. Public Improvement Bonds secured in whole or in part by Assessments levied against Property in the District as additional security in the event of a Debt Service Shortfall, including the 2013 Project Infrastructure Bonds (but excluding the 2013 LGC Tax Bonds which were refunded by the 2021 LGC Tax Refunding Bonds) and the 2021 LGC Tax Refunding Bonds, are referred to collectively as "Project Infrastructure Bonds." The 2013 Reimbursement Agreements together with the 2021 LGC Tax Bonds Reimbursement Agreement are referred to collectively as the "Reimbursement The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 5 1775.016\874945.7 Agreements." Assessment Revenue from the 2013 Facility Public Improvement Assessment levied against the Facility Property as additional security for any series of Project Infrastructure Bonds will be collected in the event of a Debt Service Shortfall in Semi-Annual Installments and deposited into the PID Operating Account as described below in Section 5.9 below. SECTION 3 ADDITIONAL FACILITY IMPROVEMENTS AND RELATED DEVELOPMENT IMPROVEMENTS 3.1 In addition to the 2013 Facility Public Improvement Assessment, the City has levied and will continue to levy Assessments (the "Additional Facility Assessments") unrelated to Project Infrastructure Bonds or the 2013 Public Improvements against the Facility Property for "Additional Facility Public Improvements" that fall into the following categories: (i) water, wastewater, and drainage facilities or improvements, including sanitary sewer facilities, storm water detention and retention facilities, and utility relocations related to such improvements; (ii) street and roadway improvements, including related traffic signalization, signage, sidewalks, curbs, gutters, streetscape, landscaping, drainage improvements, and utility relocations related to such street and roadway improvements; (iii) mass transit facilities; (iv) park improvements, (v) landscaping; (vi) lighting and signage; (vii) pedestrian malls; (viii) site improvements for any of the foregoing, including, but not limited to, grading, erosion control, wetlands mitigation, and floodplain reclamation; (ix) special supplemental services for improvement and promotion of the District, including services relating to advertising, promotion, health and sanitation, water and wastewater, public safety, security, business recruitment, development, recreation, and cultural enhancement; and (x) payment of expenses incurred in the administration and operation of the District. The Additional Facility Public Improvements for which Assessments have been previously levied are more particularly described in the special benefits reports attached to the 2015 Annual Service Plan Update, 2016 Annual Service Plan Update, 2017 Annual Service Plan Update, 2018 Annual Service Plan Update, 2019 Annual Service Plan Update, 2020 Annual Service Plan Update, 2021 Annual Service Plan Update, and in this Section 3 of this SAP Update. The Additional Facility Assessments have not been and will not be pledged as security for any series of Project Infrastructure Bonds. The Creation Resolution establishes a cap on the amount of total costs for which Assessments may be levied against the Facility Property and in no event shall the total amount of Assessments levied against the Facility Property for the 2013 Public Improvements and the Additional Facility Public Improvements exceed $150,000,000. 3.2 As described above in Section 2.2, the City deferred the 2013 Related Development Deferred Assessment for the remainder of the 2013 Public Improvements Cost in the amount of $11,400,000.00 for the portion of the 2013 Public Improvements that specially benefit the Related Development Property until the portion of the Related Development Property that is specially benefited by the 2013 Public Improvements could be identified. The City has levied, and intends to continue levying, additional Assessments against the Related Development Property for the remaining Related Development Public Improvements Cost (that do not include the 2013 Public Improvements) as portions of the Related Development Property that are specially benefited by the Related Development Public Improvements are developed. The costs of certain Related Development Public Improvements and the method of allocation of such costs based on the benefit conferred by such Related Development Public Improvements are included in this SAP Update; The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 6 1775.016\874945.7 and, additional information for the Related Development Public Improvements will be included in future updates to the Service and Assessment plan as development progresses. 3.3 The Related Development Public Improvements fall into the same categories as the 2013 Facility Public Improvements plus: (i) off street structured and surface parking facilities, (ii) special supplemental services for improvement and promotion of the District, including services relating to advertising, promotion, health and sanitation, water and wastewater, public safety, security, business recruitment, development, recreation, and cultural enhancement; and (iii) payment of expenses incurred in the administration and operation of the District. 3.4 Portions of the Related Development Property remain undeveloped, while other portions are under development or fully developed. Portions of the Property will be developed with additional mixed-use facilities including, but not limited to, entertainment, tourism, recreation, and convention facilities that will attract tourists, visitors, and shoppers from a wide geographic region, and hotels, retail stores, concessions, restaurants, and other facilities related to the entertainment, tourism, recreation, and convention uses (collectively, the "Related Development"). The portions of the Related Development currently under development include the following: the portion of the Property described as (1) Grandscape Addition, Phase II, Lot 6/Block A consisting of 2.015 acres and identified as Denton CAD Tax Parcel No. 692390; (2) Grandscape Addition, Phase II, Lot 7/Block A consisting of 2.105 acres and identified as Denton CAD Tax Parcel No. 692391; (3) Grandscape Addition, Phase II, Lot 8/Block A consisting of 2.944 acres and identified as Denton CAD Tax Parcel No. 653843; (4) Grandscape Addition, Phase II, Lot 9/Block A consisting of 2.683 acres and identified as Denton CAD Tax Parcel No. 653844; (5) Grandscape Addition Phase II, Lot 2R/Block B consisting of 1.903 acres and identified as Denton CAD Tax Parcel No. 692387; (6) Grandscape Addition Phase II, Lot 3R-X/Block B consisting of .301 acres and identified as Denton CAD Tax Parcel No. 692388; (7) Grandscape Addition Phase II, Lot 1/Block B consisting of 3.386 acres and identified as Denton CAD Tax Parcel No. 674231; (8) Grandscape Addition Phase II, Lot 1R/Block J consisting of 2.931 acres and identified as Denton DCAD Property ID No. 692379; (9) Grandscape Addition Phase II Lot 3X/Block J consisting of .204 acres and identified as Denton CAD Tax Parcel No. 692380; (10) Grandscape Addition Phase II, Lot 1(S pt)/Block H consisting of 8.551 acres and identified as Denton DCAD Property ID No. 732382; (11) Grandscape Addition Phase II, Lot 3(SE PT)/Block A consisting of 86.502 acres as identified as Denton CAD Property ID No’s. 748393,753491 and 753492; (12) Grandscape Addition Phase II BLK A LOT 3R consisting of 3.645 acres and identified as Denton CAD Tax Parcel No. 674218; (13) Grandscape Addition BLK B Lot 4 consisting of 1.925 acres and identified as Denton CAD Property ID No. 692389 (14) GRANDSCAPE ADDITION PHASE II BLK H LOT 4R2-1 consisting of 10.35 acres as identified as Denton CAD Property ID No. 1015683; (15)GRANDSCAPE ADDITION PHASE II BLK H LOT 4R1 consisting of 3.581 acres as identified as Denton CAD Property ID No. 1003642; (16) GRANDSCAPE ADDITION PHASE II BLK E LOT 1R consisting of 1.029 acres and Identified as Denton CAD Property ID No. 1004631’ (collectively 1.2(1)-(16) are, the "Related Development Property"). Certain public improvements (the "Related Development Public Improvements") are or will be required to serve the Related Development Property. The portion of the property described as Grandscape Addition, Phase II, Lot 2/Block D consisting of approximately 16.421 acres and identified as Denton CAD Tax Parcels Nos. 957987, 704832, 957988, 957989, 957990, 957991 and 957992 (the "Waterfront Property") will be developed with a boardwalk and related amenities (the "Waterfront"), including public improvements required to serve the Waterfront (the "Waterfront Public Improvements", and The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 7 1775.016\874945.7 together with the Related Development Public Improvements referred to collectively as the "Annual Related Development Public Improvements"). 3.5 All Additional Facility Public Improvements and Annual Related Development Public Improvements, and portions of the Property on which such Public Additional Facility Public Improvements and Annual Related Development Improvements are constructed, will remain owned by the City. 3.6 The annual costs for the Additional Facility Public Improvements, Waterfront Public Improvements and Related Development Public Improvements are estimated in the Official Report for the 2023-24 Public Improvements Cost attached as Exhibit B. The total cost of the Additional Facility Public Improvements is estimated to be $655,901(the "2024-25Additional Facility Public Improvements Cost") as shown on Exhibit B. The annual total cost of the Waterfront Public Improvements is estimated to be $54,167 (the "2024-25 Waterfront Public Improvements Cost") as shown on Exhibit B. The annual total cost of the Related Development Public Improvements is estimated to be $442,381 (the "2024-25 Related Development Public Improvements Cost") as shown on Exhibit B. The individual line item costs shown in the Official Report for each category of Additional Facility Public Improvements and Annual Related Development Public Improvements are estimates and may vary item-to-item so long as the cost of all Public Improvements do not exceed $1,152,450. The 2024-25 Additional Facility Public Improvements Cost, 2024-25 Waterfront Public Improvements Cost, and 2024-25 Related Development Public Improvements Cost are sometime referred to collectively as the "2024-25 Public Improvements Cost." A reconciliation of the 2023-24 Public Improvement Costs yielded a $385,496 surplus. To provide operations funding during the lag period between the budget commencement and the annual assessment collection $284,166 (90 days of operating costs) was allocated to a “Pre-paid Expense” line item. An additional $49,140 is being added to the total assessment to recover costs from parcel-specific services ("Direct Supplemental Services") as described in Exhibit D. The total sum of the 2024-25 Public Improvements Cost ($1,152,450), the 90 days of operating costs reserve ($284,166), and the parcel specific Direct Supplemental Services ($49,140) brings the overall 2024-25 costs to $1,485,757. The 2022-23 surplus of $385,496 was allocated proportionately to reduce the 2024-25 Assessment from $1,485,757 to $1,100,260.58. 3.7 Assessments levied against the Facility Property, Related Development Property, or Waterfront Property for costs of the Additional Facility Public Improvements and Annual Related Development Public Improvements, as applicable, that are not pledged as security for Project Infrastructure Bonds shall be updated annually and shall be collected as described below in Section 5.10 and shall be deposited into a sub-account of the PID Operating Account and used solely for the purposes determined by the City Council at the time the Assessments are levied. SECTION 4 SERVICE PLAN 4.1 This Section 4 is the Service Plan for the District. This Service Plan covers a period of at least five (5) years beginning with calendar year 2021 and defines the projected cost and annual indebtedness for the Public Improvements. The Service Plan shall be reviewed and updated at least annually for the purpose of determining the annual budget for the Public Improvements (each such update, a "Service Plan Update"). The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 8 1775.016\874945.7 4.2 As confirmed by the 2021 City Ordinance, the actual costs for the 2013 Public Improvements exceeded the estimated 2013 Public Improvements Cost of $94,800,000.00 described in the Original Service and Assessment Plan, the 2013 Official Report, and 2013 Special Benefit Analysis. The annual indebtedness for the 2013 Public Improvements for the next five years is shown on Exhibit C-1. The annual indebtedness for the 2013 Public Improvements Cost in any given year is the sum of the Semi-Annual Installments for the Project Infrastructure Bonds for the year. 4.3 The projected Additional Facility Public Improvements Cost is $655,901, and for the next five years is allocated as shown on Exhibit C-2. The annual indebtedness for the Additional Facility Public Improvements shown on Exhibit C-2 is a portion of the Additional Facility Assessment the City has levied or expects to levy against the Facility Property for each year shown. The Additional Facility Assessment will also include costs related to the 90 days of operating reserve apportioned to the Facility Property as well as any Direct Supplemental Services apportioned to the Facility Property which will be described in Exhibit D and will be updated each year. 4.4 The projected costs for the Annual Related Development Public are $496,548 and for the next five years such cost is allocated as shown on Exhibit C-3. The annual indebtedness for the Annual Related Development Public Improvements is a portion of the Assessments the City has levied or expects to levy against the Waterfront Property and Related Development Property for each year shown. The Assessments levied against the Waterfront Property and Related Development Property will also include costs related to the 90 days of operating reserve apportioned to the Waterfront Property and Related Development Property as well as any Direct Supplemental Services apportioned to the Waterfront Property and Related Development Property which will be described in Exhibit D and will be updated each year. 4.5 The form of notice required by Texas Property Code Section 5.014, as amended, is attached as Exhibit C-4. SECTION 5 ASSESSMENT PLAN 5.1 Method of Assessment. This Section 5 is the Assessment Plan for the District. This Assessment Plan assesses the Public Improvements Cost against the Property on the basis of the special benefits conferred on the Property by the Public Improvements. The Act provides that the Public Improvements Cost may be assessed equally per front foot or square foot (with or without regard to the value of improvements constructed on the land) or in any other manner that results in imposing equal shares of the cost on property similarly benefited. 5.2 Best and Highest Use. Based on: (i) the size and location of the Property within the corporate limits of the City; (ii) the lack of public infrastructure to serve development of the Property; (iii) the proximity of the Property to public roadways and water and sewer facilities; (iv) the proximity of the Property to population and employment centers; (v) the scope and economic impact of the Facility, the Waterfront and the Related Development on the City, Denton County; and the north Texas region; (vi) existing and projected land uses in the vicinity of the Property; (vii) projected growth in the greater Dallas metropolitan area and, in particular, along the State The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 9 1775.016\874945.7 Highway 121 corridor; and (viii) the quality of the proposed development within the Property, the City Council has determined that: (A) the best and highest use of the Property is for the development of the Facility, the Waterfront, and the Related Development; (B) achieving the best and highest use of the Property requires the Public Improvements; (C) without the Public Improvements the Property will not be developed to its best and highest use; (D) the establishment of the District provides an effective means of funding the Public Improvements to achieve the best and highest use for the Property without financial burden to the City; and (E) the Public Improvements will promote the interests of the City and confer a special benefit on the Property. 5.3 Assessments Against Facility Property. As described in Section 2.2 above, the City has levied the 2013 Facility Public Improvement Assessment in the amount of $83,400,000.00 against the Facility Property for the portion of the 2013 Public Improvements Cost that the City Council determined conferred a special benefit on the Facility Property. Based on the costs shown in the Official Report for the 2024-25 Public Improvements for the 2024-25 attached as Exhibit B and the Special Benefits Report attached as Exhibit D, the City has levied $655,901 in Assessments against the Facility Property as shown on the Assessment Roll attached as Exhibit E which consists of $655,901 for the 2024-25 Additional Facility Public Improvements Costs plus $28,753.46 or approximately 41.66% the 90 days of operating costs (after accounting for the 2023- 24 surplus as described in Section 3.6 above) apportioned to the Facility Property based on the benefit analysis described in Exhibit D. As the Facility Property is specially benefitted by Additional Facility Improvements, the City intends to continue to levy Assessments against the Facility Property. The Creation Resolution establishes a cap on the amount of the total costs for which Assessments may be levied against the Facility Property and in no event shall the total amount of Assessments levied against the Facility Property for the 2013 Public Improvements and the Additional Public Improvement exceed $150,000,000. As shown in Paragraphs 1 and 2 of Section 7 below, a total of $91,927,934.31has been levied against the Facility Property, consisting of $83,400,000.00 for the 2013 Public Improvements and $8,527,934.31for the Additional Facility Public Improvements. 5.4 Assessments Against Related Development Property. As described in Section 2.2 above, the City deferred assessment of the remainder of the 2013 Public Improvements Cost in the amount of $11,400,000.00 for the portion of the 2013 Public Improvements that specially benefit the Related Development Property (the "2013 Related Development Deferred Assessment") until the portion of the Related Development Property (which included the Waterfront Property at the time of the deferral) that is specially benefited by the 2013 Public Improvements could be identified. The deferral of the levy of the 2013 Related Development Deferred Assessment in the amount of $11,400,000.00 under the 2013 Assessment Ordinance is hereby restated and shall be deferred until the development of the Property is certified as complete by the owner. Based on the costs shown in the Official Report for the 2024-25 Public Improvements attached as Exhibit B and the Special Benefits Report attached as Exhibit D, the City has levied Assessments in the amount of $47,719.48 against the Waterfront Property and $438,858.56 against the Related Development Property for the 2024-25 Related Development Public Improvements as shown on the Assessment Roll attached as Exhibit E. As portions of the Related Development Property that are specially benefited by the Related Development Public Improvements are developed, the City intends to continue to levy additional Assessments against the Related Development Property for the remaining Related Development Public Improvements Costs and (that do not include the 2013 The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 10 1775.016\874945.7 Public Improvements) as described in Section 3.2 above. The costs of such Related Development Public Improvements and the method of allocation of such costs based on the benefit conferred by such Related Development Public Improvements for which Assessments (as shown on Exhibit E, the "2024-25 Related Development Assessment") are being levied in accordance this SAP Update are described herein. As portions of the Waterfront Property that are specially benefited by the Waterfront Public Improvements are developed, the City intends to continue to levy additional Assessments against the Waterfront Property forWaterfrontPublic Improvements Costs. The costs of such Waterfront Public Improvements and the method of allocation of such costs based on the benefit conferred by such Waterfront Public Improvements for which Assessments (as shown on Exhibit E, the "2024-25 Waterfront Assessment") are being levied in accordance this SAP Update are described herein. The Creation Resolution establishes a cap of $150,000,000 of the total costs for which Assessments may be levied for the "Related Improvements Costs" (as defined in the Creation Resolution). As shown in Paragraph 3 of Section 7 below, a total of $5,874,462.53 has been levied for the Annual Related Development Public Improvements (consisting of the Waterfront Public Improvements and Related Development Public Improvements) which does NOT include the 2013 Related Development Deferred Assessment in the amount of $11,400,00.00. 5.5 Adjustment of Assessments. With the exception of the 2013 Facility Public Improvement Assessment, the Assessments described in this Section 5 are based on estimates of the Public Improvements Costs until construction of such Public Improvement, or provision of services if applicable, is complete. If the actual cost of the Public Improvements is less than the estimates, the Assessments shall be reduced as determined by the Administrator and approved by the City Council in a Service Plan Update. 5.6 Subdivision; Change to Tax Exempt. 5.6.1 Upon Subdivision. If the Facility Property is subdivided, any Assessment levied against the Facility Property shall be reallocated as described in Section 4.6.1 of the Service and Assessment Plan. Additionally, other than annual Assessments for the Annual Related Development Public Improvements that are not pledged as security to any series of PID bonds, any Assessment against Related Development Property will not be reallocated among subdivided Parcels until the development of the Related Development Property is certified as complete by the owner. If the Related Development Property or Waterfront Property is subdivided, the annual Assessment levied against Related Development Property or Waterfront Property under this SAP Update for the Annual Related Development Public Improvements will be reallocated among the subdivided Parcels on a per-acre basis as determined by the Administrator and reflected in a Service Plan Update approved by the City Council after a public hearing for which notice addressed to "Property Owner" has been mailed, regular mail, to the current address of the owner of the property being subdivided as reflected on the tax rolls. 5.6.2 Upon Becoming Tax Exempt. If any portion of the Facility Property becomes exempt from the payment of ad valorem taxes, the owner of such portion shall pay to the City the unpaid principal amount of the Assessment allocated (on a per-acre basis) to such portion of the Facility Property plus, if applicable, accrued interest through the date of The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 11 1775.016\874945.7 payment. Prepayment Costs, if any, shall be paid as a Semi-Annual Administrative Cost. If any portion of the Related Development Property or Waterfront Property becomes exempt from the payment of ad valorem taxes, the owner of such portion shall pay to the City the unpaid principal amount of the Assessment allocated (on a per-acre basis) to such portion of the Property. 5.7 Prepayment of Assessments. The unpaid principal amount of an Assessment may be prepaid in full or in part at any time, together with accrued interest, if any, through the date of prepayment; whereupon the Assessment and corresponding assessment lien automatically terminate and shall be reduced to zero in a Service Plan Update. Prepayment Costs, if any, may be paid by the Administrator from Semi-Annual Administrative Cost. 5.8 Accrual of Interest. Assessments shall not bear interest except for interest authorized by Section 372.018(a) of the Act. Assessments that are deferred may bear interest as approved by the City Council at the time the Assessments are levied. 5.9 Semi-Annual Installments of Assessments Related to Project Infrastructure Bonds. Assessments levied against the Facility Property and/or the Related Development Property and pledged as security to any series of Project Infrastructure Bonds, including the 2013 Facility Public Improvement Assessment securing the 2013 Project Infrastructure Bonds and 2021 LGC Tax Refunding Bonds, shall be due and payable to the City in Semi-Annual Installments as set forth in the applicable Reimbursement Agreement beginning on the date stated in the applicable Reimbursement Agreement and continuing every March 1 and September 1 thereafter and will be delinquent if not paid within three calendar days after it is due and payable. Semi-Annual Installments are not required to be level amounts and will vary depending on Semi-Annual District Expenses and the amounts, if any, of Debt Service Shortfalls. For so long as any Project Infrastructure Bonds remain outstanding, each of the Corporations, pursuant to a Reimbursement Agreement, is required to calculate its respective Debt Service Shortfall amount for each bond issue based on the "Bond Debt Service" schedules attached as Exhibit E-1, and each Corporation shall certify such Debt Service Shortfall amount to the City no later than each February 1 or August 1 commencing August 1, 2013 (each a "Semi-Annual Calculation Date"). Upon notification of each Debt Service Shortfall amount due for each bond issue, the City shall calculate the amount of the Semi-Annual Installment and shall submit a bill to each property owner no later than each February 15 and August 15 (each a "Semi-Annual Billing Date"). The City will use all reasonable efforts to collect Semi-Annual Installments before they become delinquent. If a Semi-Annual Installment becomes delinquent, all remedies at law or under the Act shall be available to the City. If a Debt Service Shortfall is anticipated for more than one series of Project Infrastructure Bonds, a portion of the funds in the PID Operating Account shall be transferred on a pro-rata basis to separate sub-accounts corresponding to each issue of Project Infrastructure Bonds for which a Debt Service Shortfall is anticipated to occur; and, such amounts shall be paid by the City from such sub-accounts to each of the Corporations under the applicable Reimbursement Agreement to pay Debt Service Shortfalls for the applicable series of Project Infrastructure Bonds. As required under each respective Reimbursement Agreement, each Corporation calculated any anticipated Debt Service Shortfall based on the Bond Debt Service schedules no later than February 1, 2024 and August 1, 2024; and, each Corporation determined there would be no Debt Service Shortfall and no Semi-Annual Installments were required to be paid for calendar year 2024. The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 12 1775.016\874945.7 5.10 Annual Payment of Assessments Not Related to Project Infrastructure Bonds. Assessments levied against the Facility Property or the Related Development Property for costs of the Additional Facility Public Improvements or the Related Development Public Improvements that are not pledged as security for Project Infrastructure Bonds shall be updated annually and shall be collected by the City in the same manner and at the same time as ad valorem taxes in the amount shown on the Assessment Rolls attached to each Annual Service Plan Update. Such Assessments shall be due when billed and shall be delinquent if not paid prior to February 1 of the following year. Failure of a landowner to receive an invoice for such Assessment on the property tax bill shall not relieve the landowner of the responsibility for payment of the Assessment. Assessment Revenue collected by the City from Assessments levied against the Facility Property or the Related Development Property for Additional Facility Public Improvements and/or Related Development Public Improvements based on the special benefit conferred by such Additional Facility Public Improvements or the Related Development Public Improvements that is not pledged as security for any series of Project Infrastructure Bonds and shall be deposited into a sub-account of the PID Operating Account and used solely for the purposes determined by the City Council at the time the Assessments are levied. 5.11 PID Operating Account. Assessment Revenue from the collection of Semi-Annual Installments of an Assessment against the Facility Property and/or Related Development Property in connection with the issuance of a series of Project Infrastructure Bonds will be deposited by the City into the PID Operating Account, including sub-accounts corresponding to each issue of Project Infrastructure Bonds, as applicable, immediately upon receipt and will be transferred by the City to the respective Corporations, or to the applicable trustee(s) for the benefit of such Corporations, to pay Debt Service Shortfalls, if any, by September 5, 2013, and by each March 5 and September 5 thereafter for so long as Project Infrastructure Bonds are outstanding. Assessment Revenue from the collection of an Assessment against the Facility Property and/or Related Development Property unrelated to the issuance of a series of Project Infrastructure Bonds will be deposited by the City into the PID Operating Account, including sub-accounts as applicable, immediately upon receipt and shall be used solely for the purposes determined by the City Council at the time such Assessments were levied. Any Assessment Revenue due to the Corporations on any such date but collected by the City after the due date shall be transferred to the respective Corporations or applicable trustee(s) within two business days. Assessment Revenue from the collection of any Assessment against the Property will be deposited by the City into the PID Operating Account for Annual Assessments. Assessment Revenue from the 2024 Related Development Assessment against all or any portion of the Property will be collected in lump sum with 30 days of the levy of the assessment or with the annual property tax collection and deposited into a segregated operating account (the "PID Operating Account for Annual Assessments") created and controlled by the City. Interest earned on the PID Operating Account for Annual Assessments shall be added to and become part of the PID Operating Account for Annual Assessments. The PID Operating Account for Annual Assessments is a separate account and segregated from the "PID Operating Account" described in the Service and Assessment Plan that was created pursuant to the 2013 Assessment Ordinance (such account is referred to herein as the "PID Operating Account for Pledged Revenues.") All Assessment Revenue from the 2013 Facility Public Improvement Assessment and the 2013 Related Development Deferred Assessment levied pursuant to Ordinance No. 2013-1992 shall be deposited into the PID Operating Account for Pledged Revenues and transferred from that account, if at all, consistent with the requirements of The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 13 1775.016\874945.7 2013 Assessment Ordinance and the trust indentures governing the Project Infrastructure Bonds. All Assessment Revenue from any Assessment levied on an annual basis shall be deposited into the PID Operating Account for Annual Assessments and used solely for the purposes determined by the City Council at the time the Assessments are levied. 5.12 Reduction of Assessment Against the Property. The Assessment against the Facility Property (and the corresponding assessment lien) shall be reduced by the sum of all amounts by which the outstanding principal of the Project Infrastructure Bonds for which the PID Operating Account is pledged, as additional security, are reduced and by sum of all prepayments of the Assessment made pursuant to Section 5.7. The current outstanding principal amount of the Assessments levied against the Facility Property based on the debt service schedules related to the Project Infrastructure Bonds attached as Exhibit E-1 is set forth in Section 7 below. The Assessment against the Property (and the corresponding assessment lien) shall be reduced by the sum of all amounts by which the Public Improvement Costs are reduced. 5.13 Security for Payment. All payments due in accordance with the Service and Assessment Plan as updated by this SAP Update shall be treated the same with respect to the liens created to secure payment and the rights of the City, including foreclosure, in the event of delinquencies. Any foreclosure sale of a Parcel for nonpayment of any such amounts shall be subject to a continuing lien for the remaining unpaid amounts in accordance with state law. All assessment liens created pursuant to the 2013 Assessment Ordinance are superior to any lien created by any other ordinance approving an Annual Service Plan Update, including this SAP Update. 5.14 Release of Lien. When an Assessment has been paid in full, the Administrator shall notify the City, and the City shall execute a release, in recordable form, evidencing full payment of the Assessment and the unconditional release of the lien securing payment of the Assessment. All releases shall be reflected in a Service Plan Update. 5.15 Findings and Determinations. The findings and determinations by the City Council set forth in this Service and Assessment Plan are based on: (i) the 2013 Official Report prepared by Graham Associates, Inc.; (ii) the 2013 Special Benefits Report prepared by Graham Associates, Inc.; (iii) evidence and testimony presented to the City Council; and (iv) information made available to the City Council. The City Council hereby confirms and ratifies the findings and determinations made by the City Council in the 2015 Assessment Ordinance, 2016 Assessment Ordinance, 2017 Assessment Ordinance, 2018 Assessment Ordinance, 2019 Assessment Ordinance and 2020 Assessment Ordinance, including the special benefits reports and annual service plan updates attached thereto. The City Council has relied on the information contained in the 2013 Official Report, 2013 Special Benefits Report, the reports and special benefit analysis contained in each Annual Service Plan Update, evidence, and testimony in the preparation and approval of this Service and Assessment Plan and the allocation of the Public Improvements Cost to the Property. Such findings and determinations represent the discretionary exercise by the City Council of its legislative and governmental authority and power, and such findings and determinations are conclusive and binding on the current and future owners of the Property. The Corporations have concurred in and approved the findings and determinations by the City Council as set forth in this Service and Assessment Plan and have otherwise concurred in and approved this Service and Assessment Plan and the levy of Assessments against the Property. The The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 14 1775.016\874945.7 Corporations have acknowledged that the Property is subject to payment of Assessments and/or Semi-Annual Installments as provided in this Service and Assessment Plan and in the Reimbursement Agreements. SECTION 6 ANNUAL BUDGET FOR PUBLIC IMPROVEMENTS 6.1 2013 Public Improvements Costs. On January 19, 2021, the City approved Ordinance No. 2021-2430 (the "2021 City Ordinance"), approving the Service and Assessment Plan and making certain finding and determinations related to the District. In the 2021 City Ordinance, the City Council ratified and confirmed the allocation of the 2013 Public Improvements Cost approved by the 2013 Assessment Ordinance and Original Service and Assessment Plan as follows: (1) $83,400,000 for the special benefit to the Facility Property for which the 2013 Facility Public Improvement Assessment was levied, and (2) $11,400,000.00 for the benefit to the Related Development Property for which the 2013 Related Development Deferred Assessment has been deferred. Additionally, the 2021 City Ordinance confirmed that the actual costs for the 2013 Public Improvements exceeded the estimated 2013 Public Improvements Cost of $94,800,000.00 described in the Original Service and Assessment Plan, the 2013 Official Report, and 2013 Special Benefit Analysis. 6.2 2024 Public Improvements Cost. The City Council has received, reviewed, and approved that certain SPECIAL BENEFITS REPORT, The City of The Colony Public Improvement District No. 1, The Colony, Texas dated September 3 rd, 2024 prepared by Executive Business Liaison Jeremie Maurina, a copy of which is attached as Exhibit D (the "2024-25 Special Benefits Report”). The individual line item costs shown in the 2024 Special Benefits Report for each category of improvements are estimates and may vary item-to-item so long as the Public Improvements Cost does not exceed $1,152,451 (which does not include the $284,166 for 90 days of operating costs plus $49,140 Direct Supplemental Services minus the $385,496 2023-24 surplus). SECTION 7 ASSESSMENT ROLL This Section 7 describes the Assessment Roll for the District. The Assessment Roll is set forth on Exhibit E and consists of: 1. The 2013 Facility Public Improvement Assessment originally levied in principal amount of $83,400,000.00 by the 2013 Assessment Ordinance with an outstanding principal amount of $77,842,986 as of December 31, 2022. The 2013 Facility Public Improvement Assessment is allocated as follows among the Project Infrastructure Bonds: Pro-Rata Share(1) Allocated Portion of Original 2013 Facility Public Improvement Assessment Outstanding Principal Amount of 2013 Facility Public Improvement Assessment 2013 LGC Sales Tax Bonds 16.80% $14,011,200 $ 13,203,625 (2) The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 15 1775.016\874945.7 2021 LGC Tax Refunding Bonds(3)20.60% $17,180,400 (3)$ 16,022,715 (2) 2013 Type A Bonds 31.30% $26,104,200 $ 24,308,323 (2) 2013 Type B Bonds 31.30% $26,104,200 $ 24,308,323 (2) (1)Pro-rata allocation of the original principal amount of the $83,400,000 2013 Facility Public Improvement Assessment was based on the par amount of each series of 2013 Project Infrastructure Bonds issued as a percentage of the total par amount of all 2013 Project Infrastructure Bonds. (2)In accordance with Section 5.12 above, the principal amount of the 2013 Facility Public Improvement Assessment was reduced by the sum of all amounts by which the outstanding principal amount of the 2013 Project Infrastructure Bonds have been reduced. As of December 31, 2021, the outstanding par amount of the 2013 Project Infrastructure Bonds (with the 2021 LGC Tax Refunding Bonds) was $88,253,000 thus reducing the outstanding 2013 Facility Public Improvement Assessment to $77,842,986. The following Semi-Annual Installments have been collected to pay Debt Service Shortfalls on the 2013 LGC Sales Tax Bonds: on February 14, 2017 in the amount of $500,081.25; on July 17, 2017 in the amount of $1,158,162.50; on July 16, 2018 in the amount of $1,294,662.50; and on July 25, 2019 in the amount of $1,306,963.00 for a total of $4,259,869.25 which payments do not reduce the principal amount of the 2013 Facility Public Improvement Assessment. (3)The pro-rata share of the 2013 Facility Public Improvement Assessment that formerly secured the 2013 LGC Tax Bonds now secures the 2021 LGC Tax Refunding Bonds. [Remainder of page left blank intentionally.] The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 16 1775.016\874945.7 2. Assessments related to the Additional Facility Public Improvements: Original Principal Amount Levied Outstanding as of 9/3/2024 2015 Facility Assessment(1)$959,247.96 $0.00 2015-16 Facility Assessment(2)$1,218,234.83 $0.00 2016 Facility Assessment $875,155.64 $0.00 2017 Facility Assessment $658,465.00 $0.00 2018 Facility Assessment $810,379.62 $0.00 2019 Facility Assessment $570,667.99 $0.00 2020 Facility Assessment $862,382.25 $0.00 2021 Facility Assessment $535,879.94 $0.00 2022 Facility Assessment $731,985.36 $0.00 2023 Facility Assessment $691,853.18 $0.00 2024 Facility Assessment $613,682.54 $613,682.54 TOTAL: $8,527,934.31 (1)Levied under Ordinance No. 2015-2136 approved on May 5, 2015. (2)Levied under Ordinance No. 2015-2160 approved on September 15, 2015. 3. Assessments related to the Annual Related Development Public Improvements: 1 Original Principal Amount Levied Outstanding as of 9/3/2024 2015 Related Development Assessment(1)$420,053.04 $0.00 2015-16 Related Development Assessment(2)$236,757.17 $0.00 2016 Related Development Assessment $287,680.36 $0.00 2017 Related Development Assessment $872,993.00 $0.00 2018 Related Development Assessment $687,426.36 $0.00 2019 Related Development Assessment $490,441.03 $0.00 2020 Related Development Assessment $810,043.90 $0.00 2021 Related Development Assessment $366,446.95 $0.00 2022 Related Development Assessment $572,445.40 $0.00 2023 Related Development Assessment $643,597.28 $0.00 2024 Related Development Assessment $486,578.04 $486,578.04 TOTAL: $5,874,462.53 (1)Levied under Ordinance No. 2015-2136 approved on May 5, 2015. 1 Includes the Assessments levied against the Waterfront Property and the Related Development Property. Excludes the 2013 Related Development Deferred Assessment. The Colony Public Improvement District No. 1 Annual Service and Assessment Plan Update - Page 17 1775.016\874945.7 (2)Levied under Ordinance No. 2015-2160 approved on September 15, 2015. As authorized by the Act, the assessment of the 2013 Related Development Deferred Assessment in the amount of $11,400,000 for the portion of the 2013 Facility Public Improvements that benefit the Related Development Property remains deferred until the development of the Related Development Property is certified as complete by the owner which will be the time at which the special benefit conferred on the Related Development Property can be determined with certainty. SECTION 8 ADDITIONAL PROVISIONS 8.1 Severability. The provisions of this Service and Assessment Plan are intended to be severable. In the event any provision of this Service and Assessment Plan, or the application thereof to any person or circumstance, is held or determined to be invalid, illegal, or unenforceable, and if such invalidity, unenforceability, or illegality does not cause substantial deviation from the underlying intent of the City Council as expressed in this Service and Assessment Plan, then such provision shall be deemed severed from this Service and Assessment Plan with respect to such person, entity, or circumstance without invalidating the remainder of this Service and Assessment Plan or the application of such provision to other persons, entities, or circumstances. 8.2 Exhibits. The following exhibits are part of this Service and Assessment Plan: Exhibit A Legal Description of the Property Exhibit A-1 Depiction of the Property Exhibit B Official Report – 2022 Public Improvements Cost Exhibit C-1 Service Plan: Five-Year Projection of 2013 Public Improvements Exhibit C-2 Service Plan: Five-Year Projection of Additional Facility Public Improvements Costs Exhibit C-3 Service Plan: Five-Year Projection of Related Development Public Improvements Costs Exhibit C-4 Form of Notice Required by Texas Property Code Section 5.014 Exhibit D Special Benefits Report Exhibit E Assessment Roll Exhibit E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfall Exhibit F Chronological History of City Council Legislative Actions for the District Exhibit A Legal Description of the Property (439.12 Acres) Exhibit A to The Colony SAP – Legal Description of the Property - Page 1 1775.016\874945.7 Being a 439.12 acre tract of land situated in the B.B.B & C.R.R. Survey, Abstract No. 173, B.B.B. & C. Survey, Abstract No. 174, Thomas A. West Survey, Abstract No. 1344, and the M.D.T. Hallmark Survey, Abstract No. 570, Denton County, Texas, and being all of a tract of land conveyed by deed to 121 Acquisition Company, LLC., as recorded in Instrument No. 2011-114773, 2011-121444, and 2011-112195, Deed Records, Denton County, Texas, and a portion of Plano Parkway and a portion of Burlington Northern Railroad tract, and being more particularly described as follows: BEGINNING at a found TxDOT monument, said point being the northwest corner of said 121 Acquisition Company, LLC tract and being in the south right-of-way line of State Highway 121 (having a variable width R.O.W.); THENCE North 63°32'06" East, along said south right-of-way line, a distance of 130.52 feet to a point for corner; THENCE North 60°22'33" East, continuing along said south right-of-way line, a distance of 80.86 feet to a point for corner; THENCE South 29°13'03" East, continuing along said south right-of-way line, a distance of 50.00 feet to a point for corner; THENCE North 60°47'38" East, continuing along said south right-of-way line, a distance of 219.64 feet to a point for corner, said point being in the west right-of-way line of Plano Parkway (100 ft R.O.W.); THENCE North 50°53'35" East, leaving said south right-of-way line, and leaving said west right-of-way line, a distance of 100.00 feet to a point for corner, for the beginning of a non-tangent curve to the right having a radius of 950.00 feet and a central angle of 1°26'54" and a long chord which bears North 38°22'58" West, 24.01 feet, said point being in the east right-of-way line of said Plano Parkway; THENCE along said east right-of-way line, and along said non-tangent curve to the right an arc distance of 24.01 feet to a point for corner, said point being the most southerly point of a corner-clip of the intersection of said east right-of- way line of Plano Parkway and the south right-of-way line of said State highway 121; THENCE North 08°46'31" East, along said corner-clip, a distance of 26.03 feet to a point for corner, said point being in the south right-of-way line of said State highway 121; THENCE North 60°47'38" East, along said south right-of-way line, a distance of 203.71 feet to a point for corner; THENCE North 58°17'36" East, continuing along said south right-of-way line, a distance of 252.11 feet to a point for corner; THENCE North 55°47'40" East, continuing along said south right-of-way line, a distance of 105.11 feet to a point for corner; THENCE North 58°17'42" East, continuing along said south right-of-way line, a distance of 248.62 feet to a point for corner; THENCE North 60°47'38" East, continuing along said south right-of-way line, a distance of 263.85 feet to a point for corner; THENCE North 76°30'51" East, continuing along said south right-of-way line, a distance of 92.27 feet to a point for corner; THENCE North 65°56'12" East, continuing along said south right-of-way line, a distance of 100.40 feet to a point for corner; THENCE North 64°13'39" East, continuing along said south right-of-way line, a distance of 100.18 feet to a point for corner; THENCE North 60°16'36" East, continuing along said south right-of-way line, a distance of 39.88 feet to a point for corner; THENCE South 74°12'01" East, continuing along said south right-of-way line, a distance of 70.70 feet to a point for corner; THENCE North 60°47'38" East, continuing along said south right-of-way line, a distance of 64.12 feet to a point for corner; THENCE North 15°47'17" East, continuing along said south right-of-way line, a distance of 73.27 feet to a point for corner; Exhibit A Legal Description of the Property (439.12 Acres) Exhibit A to The Colony SAP – Legal Description of the Property - Page 2 1775.016\874945.7 THENCE North 59°04'32" East, continuing along said south right-of-way line, a distance of 94.25 feet to a point for corner; THENCE North 55°39'04" East, continuing along said south right-of-way line, a distance of 100.40 feet to a point for corner; THENCE North 47°37'54" East, continuing along said south right-of-way line, a distance of 114.18 feet to a point for corner; THENCE North 60°47'38" East, continuing along said south right-of-way line, a distance of 3800.00 feet to a point for corner; THENCE North 65°20'10" East, continuing along said south right-of-way line, a distance of 189.41 feet to a point for corner; THENCE North 61°56'23" East, continuing along said south right-of-way line, a distance of 100.02 feet to a point for corner; THENCE North 63°39'23" East, continuing along said south right-of-way line, a distance of 100.12 feet to a point for corner; THENCE North 64°47'53" East, continuing along said south right-of-way line, a distance of 100.24 feet to a point for corner; THENCE North 66°30'16" East, continuing along said south right-of-way line, a distance of 201.00 feet to a point for corner; THENCE North 65°56'12" East, continuing along said south right-of-way line, a distance of 100.40 feet to a point for corner; THENCE North 66°30'16" East, continuing along said south right-of-way line, a distance of 100.50 feet to a point for corner; THENCE North 63°05'04" East, continuing along said south right-of-way line, a distance of 100.08 feet to a point for corner; THENCE North 64°13'39" East, continuing along said south right-of-way line, a distance of 100.18 feet to a point for corner; THENCE North 83°05'27" East, continuing along said south right-of-way line, a distance of 69.58 feet to a point for corner; THENCE North 60°39'18" East, continuing along said south right-of-way line, a distance of 33.81 feet to a point for corner, said point being in the west right-of-way line of Burlington Northern Railroad (having a variable width R.O.W.); THENCE North 60°38'52" East, leaving said west right-of-way line, a distance of 107.30 feet to a point for corner, said point being in the east right-of-way line of said Burlington Northern Railroad; THENCE North 60°45'58" East, leaving said east right-of-way line, continuing along said south right-of-way line of State Highway 121, a distance of 254.35 feet to a point for corner; THENCE North 63°19'02" East, continuing along said south right-of-way line, a distance of 585.96 feet to a point for corner; THENCE North 60°52'09" East, continuing along said south right-of-way line, a distance of 369.37 feet to a point for corner, said point being in the west right-of-way line of West Spring Creek Parkway (having a 160 ft R.O.W.); THENCE South 29°24'43" East, leaving said south right-of-way line, and along said west right-of-way line, a distance of 265.52 feet to a point for corner, for the beginning of a non-tangent curve to the right having a radius of 970.00 feet and a central angle of 29°13'42", and a long chord which bears South 14°53'13" East, 489.48 feet; THENCE continuing along said west right-of-way line, and along said non-tangent curve to the right an arc distance of 494.83 feet to a point for corner; THENCE South 00°22'42" East, continuing along said west right-of-way line, a distance of 476.17 feet to a point for corner; Exhibit A Legal Description of the Property (439.12 Acres) Exhibit A to The Colony SAP – Legal Description of the Property - Page 3 1775.016\874945.7 THENCE South 00°23'35" East, continuing along said west right-of-way line, a distance of 864.92 feet to a point for corner, said point being in the north line of Kings Ridge Addition, Phase Three, as recorded in Cabinet X, Page 450, Plat Records, Denton County, Texas; THENCE South 89°40'20" West, leaving said west right-of-way line, and along said north line, a distance of 1199.93 feet to a point for corner, said point being in the east right-of-way line of said Burlington Northern Railroad; THENCE North 87°39'44" West, leaving said north line, leaving said east right-of-way line, a distance of 101.16 feet to a point for corner, for the beginning of a non-tangent curve to the right having a radius of 3703.75 feet and a central angle of 3°44'19" and a long chord which bears South 04°12'25" West, 241.62 feet, said point being in the west right- of-way line of said Burlington Northern Railroad; THENCE along said east right-of-way line, and along said non-tangent curve to the right an arc distance of 241.67 feet to a point for corner; THENCE South 06°04'35" West, continuing along said east right-of-way line, a distance of 2524.64 feet to a point for corner; THENCE North 83°17'00" West, continuing along said east right-of-way line, a distance of 190.16 feet to a point for corner; THENCE South 00°51'51" East, continuing along said east right-of-way line, a distance of 970.10 feet to a point for corner; THENCE South 89°03'50" West, continuing along said east right-of-way line, a distance of 31.06 feet to a point for corner; THENCE South 01°14'37" East, continuing along said east right-of-way line, a distance of 447.78 feet to a point for corner; THENCE North 87°06'22" West, leaving said east right-of-way line, a distance of 1240.48 feet to a point for corner, for the beginning of a non-tangent curve to the left having a radius of 1130.00 feet and a central angle of 103°16'58", and a long chord which bears North 38°43'34" West, 1772.16 feet, said point being in the east right-of-way line of said Plano Parkway; THENCE along said east right-of-way line, and along said non-tangent curve to the left an arc distance of 2036.97 feet to a point for corner; THENCE South 89°38'05" West, continuing along said east right-of-way line, a distance of 647.23 feet to a point for corner, for the beginning of a non-tangent curve to the right having a radius of 950.00 feet and a central angle of 40°05'36" and a long chord which bears North 70°19'29" West, 651.29 feet; THENCE continuing along said east right-of-way line, and along said non-tangent curve to the right an arc distance of 664.77 feet to a point for corner, for the beginning of a reverse curve to the left having a radius of 1050.00 feet and a central angle of 40°15'06" and a long chord which bears North 70°25'01" West, 722.57 feet; THENCE continuing along said east right-of-way line, and along said curve to the left an arc distance of 737.65 feet to a point for corner; THENCE South 89°31'25" West, continuing along said east right-of-way line, a distance of 623.83 feet to a point for corner, for the beginning of a tangent curve to the right having a radius of 950.00 feet, a central angle of 0°48'07", and a long chord which bears South 89°55'28" West, 13.21 feet; THENCE continuing along said east right-of-way line, along said curve to the right, an arc distance of 13.21 feet to a point for corner; THENCE South 00°19'22" West, leaving said east right-of-way line, a distance of 100.00 feet to a point for corner, said point being in the west right-of-way line of said Plano Parkway; THENCE South 89°58'40" West, leaving said west right-of-way line, a distance of 1210.45 feet to a point for corner; THENCE North 00°25'18" West, a distance of 226.47 feet to the POINT OF BEGINNING and CONTAINING 19,128,279 square feet, 439.12 acres of land, more or less. Exhibit A-1 Depiction of the Property Exhibit A-1 to The Colony SAP – Depiction of the Property - Page 1 1775.016\874945.7 EXHIBIT B Exhibit B to The Colony SAP – Official Report - Public Improvement Cost - Page 1 1775.016\874945.7 OFFICIAL REPORT 2024 PUBLIC IMPROVEMENTS COST The City of The Colony Public Improvement District No. 1 The Colony, Texas PREPARED BY: Jeremie Maurina, Executive Business Liaison DATED: September 3rd, 2024 Ex h i b i t B Ex h i b i t B t o T h e C o l o n y S A P – O f f i c i a l R e p o r t - P u b l i c I m p r o v e m e n t s C o s t - P a g e 2 17 7 5 . 0 1 6 \ 8 7 4 9 4 5 . 7 Of f i c i a l R e p o r t - P u b l i c I m p r o v e m e n t s C o s t 1 P u b l i c I m p r o v e m e n t s F a c i l i t y W a t e r f r o n t R e l a t e d D e v e l o p m e n t T O T A L S Tr a f f i c m a n a g e m e n t s y s t e m $ 4 7 , 2 5 6 . 5 2 $ 0 $ 0 $ 4 7 , 2 5 6 . 5 2 En h a n c e d p o l i c e s e r v i c e s $ 2 5 3 , 9 9 4 . 1 5 $ 0 $ 0 $ 2 5 3 , 9 9 4 . 1 5 En h a n c e d D e v e l o p m e n t S e r v i c e s $ 0 $ 0 $ 0 $ 0 St r e e t a n d r o a d w a y im p r o v e m e n t s $ 3 4 2 , 5 6 8 . 0 7 $ 5 2 , 3 2 2 . 3 6 $ 4 2 7 , 3 0 9 . 5 8 $ 8 2 2 , 2 0 0 La k e m a i n t e n a n c e $ 1 2 , 0 8 2 . 7 9 $ 1 , 8 4 5 . 4 7 $ 1 5 , 0 7 1 . 7 3 $ 2 9 , 0 0 0 T O T A L S $ 6 5 5 , 9 0 1 . 5 3 $ 5 4 , 1 6 7 . 8 3 $ 4 4 2 , 3 8 1 . 3 1 $ 1 , 1 5 2 , 4 5 0 . 6 7 1 Co s t s s h o w n d o n o t i n c l u d e c o s t s r e l a t e d t o 9 0 d a y s o f o p e r a t i n g c o s t s o r c o s t s r e l a t e d t o D i r e c t S u p p l e m e n t a l S e r v i c e s . Se e Ex h i b i t D ( S p e c i a l B e n e f i t s R e p o r t s ) fo r i n f o r m a t i o n a b o u t t h e s e c o s t s . Ex h i b i t C - 1 Se r v i c e P l a n : F i v e - Y e a r P r o j e c t i o n o f A n n u a l I n d e b t e d n e s s Re l a t e d t o 2 0 1 3 F a c i l i t y P u b l i c I m p r o v e m e n t s Ex h i b i t C - 1 t o T h e C o l o n y S A P - P r o j e c t i o n o f A n n u a l I n d e b t e d n e s s R e l a t e d t o 2 0 1 3 F a c i l i t y P u b l i c I m p r o v e m e n t s C o s t - P a g e 1 17 7 5 . 0 1 6 \ 8 7 4 9 4 5 . 7 Ye a r Pr i n c i p a l 1 Se m i - A n n u a l Co l l e c t i o n C o s t s 2 De l i n q u e n t C o l l e c t i o n Co s t s 3 An n u a l A d m i n i s t r a t i v e Co s t s 4 Es t i m a t e d A n n u a l In d e b t e d n e s s 20 2 3 S e e S e c t i o n s 4 . 2 a n d 5. 9 $5 , 0 0 0 $ 0 $ 5 , 0 0 0 S e e S e c t i o n 5 . 9 20 2 4 S e e S e c t i o n s 4 . 2 a n d 5. 9 $5 , 0 0 0 $ 0 $ 5 , 0 0 0 S e e S e c t i o n 5 . 9 20 2 5 S e e S e c t i o n s 4 . 2 a n d 5. 9 $5 , 0 0 0 $ 0 $ 5 , 0 0 0 S e e S e c t i o n 5 . 9 20 2 6 S e e S e c t i o n s 4 . 2 a n d 5. 9 $5 , 0 0 0 $ 0 $ 5 , 0 0 0 S e e S e c t i o n 5 . 9 20 2 7 S e e S e c t i o n s 4 . 2 a n d 5. 9 $5 , 0 0 0 $ 0 $ 5 , 0 0 0 S e e S e c t i o n 5 . 9 1. S e e S e c t i o n 7 , P a r a g r a p h 1 f o r t h e o u t s t a n d i n g P r i n c i p a l A m o u n t o f t h e 2 0 1 3 F a c i l i t y P u b l i c I m p r o v e m e n t A s s e s s m e n t a s o f S e p t e m b e r 7 t h , 2 0 2 1 . T h e a n n u a l i n d e b t e d n e s s f o r th e 2 0 1 3 P u b l i c I m p r o v e m e n t s C o s t i n a n y g i v e n y e a r i s t h e s u m o f t h e S e m i - A n n u a l I n s t a l l m e n t s f o r t h e P r o j e c t I n f r a s t r u c t u r e B o n d s f o r t h e y e a r . 2. S e m i - A n n u a l C o l l e c t i o n C o s t s m a y b e i n c r e a s e d o r r e d u c e d a s p a r t o f e a c h S e r v i c e P l a n U p d a t e . I f t h e S e m i - A n n u a l C o l l e c t i o n C o s t s c o l l e c t e d a r e l e s s t h a n t h e S e m i - A n n u a l Co l l e c t i o n C o s t s p a i d o r i n c u r r e d , t h e d e f i c i t m a y b e c a r r i e d f o r w a r d a n d a d d e d t o t h e S e m i - A n n u a l C o l l e c t i o n C o s t s f o r t h e n e x t y e a r o r p a i d a s S e m i - A n n u a l A d m i n i s t r a t i v e Co s t s . I f t h e S e m i - A n n u a l C o l l e c t i o n C o s t s c o l l e c t e d e x c e e d t h e S e m i - A n n u a l C o l l e c t i o n C o s t s p a i d o r i n c u r r e d , t h e e x c e s s s h a l l b e c a r r i e d f o r w a r d t o r e d u c e t h e S e m i - A n n u a l Co l l e c t i o n C o s t s f o r t h e n e x t y e a r . S e m i - A n n u a l C o l l e c t i o n C o s t s s h a l l b e a l l o c a t e d p r o r a t a a m o n g a l l P a r c e l s w i t h u n p a i d A s s e s s m e n t s . 3. T h i s e x h i b i t i n c l u d e s n o D e l i n q u e n t C o l l e c t i o n C o s t s . T h e a c t u a l a m o u n t o f D e l i n q u e n t C o l l e c t i o n C o s t s a t t r i b u t a b l e t o a P a r c e l w i l l , i f n o t p a i d u p o n d e m a n d , b e a d d e d t o t h e Se m i - A n n u a l I n s t a l l m e n t f o r t h e P a r c e l a s p a r t o f t h e S e r v i c e P l a n U p d a t e f o r t h e n e x t y e a r . I f D e l i n q u e n t C o l l e c t i o n C o s t s r e m a i n u n p a i d , t h e y w i l l c o n t i n u e t o b e a d d e d t o t h e Se m i - A n n u a l I n s t a l l m e n t f o r t h e P a r c e l a s p a r t o f t h e S e r v i c e P l a n U p d a t e f o r t h e n e x t y e a r . 4. S e m i - A n n u a l A d m i n i s t r a t i v e C o s t s ( u p t o t h e m a x i m u m a m o u n t d e t e r m i n e d b y t h e a d d i t i o n a l i n t e r e s t a u t h o r i z e d b y S e c t i o n 3 7 2 . 0 1 8 ( a ) o f t h e A c t ) a r e e s t i m a t e d a n d m a y b e in c r e a s e d o r r e d u c e d a s p a r t o f e a c h S e r v i c e P l a n U p d a t e . I f t h e S e m i - A n n u a l A d m i n i s t r a t i v e C o s t s c o l l e c t e d a r e n o t e n o u g h t o p a y t h e S e m i - A n n u a l A d m i n i s t r a t i v e C o s t s p a i d or i n c u r r e d , t h e d e f i c i t m a y b e c a r r i e d f o r w a r d a n d a d d e d t o t h e S e m i - A n n u a l A d m i n i s t r a t i v e C o s t s f o r t h e n e x t y e a r . I f t h e S e m i - A n n u a l A d m i n i s t r a t i v e C o s t s c o l l e c t e d e x c e e d Ex h i b i t C - 1 Se r v i c e P l a n : F i v e - Y e a r P r o j e c t i o n o f A n n u a l I n d e b t e d n e s s Re l a t e d t o 2 0 1 3 F a c i l i t y P u b l i c I m p r o v e m e n t s Ex h i b i t C - 1 t o T h e C o l o n y S A P - P r o j e c t i o n o f A n n u a l I n d e b t e d n e s s R e l a t e d t o 2 0 1 3 F a c i l i t y P u b l i c I m p r o v e m e n t s C o s t - P a g e 2 17 7 5 . 0 1 6 \ 8 7 4 9 4 5 . 7 th e S e m i - A n n u a l A d m i n i s t r a t i v e C o s t s p a i d o r i n c u r r e d , t h e e x c e s s s h a l l b e c a r r i e d f o r w a r d t o r e d u c e t h e S e m i - A n n u a l A d m i n i s t r a t i o n C o s t s f o r t h e n e x t y e a r . S e m i - A n n u a l Ad m i n i s t r a t i v e C o s t s s h a l l b e a l l o c a t e d p r o r a t a a m o n g a l l P a r c e l s w i t h u n p a i d A s s e s s m e n t s . Ex h i b i t C - 2 Se r v i c e P l a n : F i v e - Y e a r P r o j e c t i o n o f A n n u a l I n d e b t e d n e s s Re l a t e d t o A d d i t i o n a l F a c i l i t y P u b l i c I m p r o v e m e n t s 1 20 2 4 20 2 5 20 2 6 20 2 7 20 2 8 $6 1 9 , 6 8 2 $ 6 5 0 , 6 6 6 $ 6 8 3 , 1 9 9 $ 7 1 7 , 3 5 9 $ 7 5 3 , 2 2 7 1 Co s t s s h o w n d o n o t i n c l u d e c o s t s r e l a t e d t o 9 0 d a y s o f o p e r a t i n g c o s t s o r c o s t s r e l a t e d t o D i r e c t S u p p l e m e n t a l S e r v i c e s . Se e Ex h i b i t D ( S p e c i a l B e n e f i t s R e p o r t s ) fo r i n f o r m a t i o n a b o u t t h e s e c o s t s . Ex h i b i t C - 3 t o T h e C o l o n y S A P - P r o j e c t i o n o f A n n u a l I n d e b t e d n e s s R e l a t e d t o A n n u a l R e l a t e d D e v e l o p m e n t Pu b l i c I m p r o v e m e n t s C o s t - P a g e 1 17 7 5 . 0 1 6 \ 8 7 4 9 4 5 . 7 Ex h i b i t C - 3 Se r v i c e P l a n : F i v e - Y e a r P r o j e c t i o n o f A n n u a l I n d e b t e d n e s s Re l a t e d t o A n n u a l R e l a t e d D e v e l o p m e n t P u b l i c I m p r o v e m e n t s 1 20 2 4 20 2 5 20 2 6 20 2 7 20 2 8 $4 8 6 , 5 7 8 $ 5 1 0 , 9 0 7 $ 5 3 6 , 5 4 2 $ 5 6 3 , 2 7 4 $ 5 9 1 , 4 3 9 1 Co s t s s h o w n d o n o t i n c l u d e c o s t s r e l a t e d t o 9 0 d a y s o f o p e r a t i n g c o s t s o r c o s t s r e l a t e d t o D i r e c t S u p p l e m e n t a l S e r v i c e s . Se e Ex h i b i t D ( S p e c i a l B e n e f i t s R e p o r t s ) fo r i n f o r m a t i o n a b o u t t h e s e c o s t s . Exhibit C-4 Exhibit C-4 to The Colony SAP – Form of Notice Required by Texas Property Code Section 5.014 - Page 1 1775.016\874945.7 FORM OF NOTICE REQUIRED BY TEXAS PROPERTY CODE SECTION 5.014 Effective September 1, 2021, Texas Property Code §5.014 requires a seller of any real property located in a public improvement district to give notice TWICE to the purchaser of the purchaser's obligation to pay the PID assessment in the form required under Texas Property Code §5.014, as amended. Section 5.0141 of the Texas Property Code requires the "First Notice" below to be given to a prospective purchaser BEFORE the execution of a binding contract of purchase and sale, either separately or as an addendum or paragraph of a purchase contract. AT CLOSING, Section 5.0143 of the Texas Property Code requires a separate copy of the "Second Notice" below, with current information, to be executed by the seller and purchase, acknowledged and recorded in the deed records of the county in which the property is located. FIRST NOTICE: NOTICE OF OBLIGATION TO PAY IMPROVEMENT DISTRICT ASSESSMENTS TO THE CITY OF THE COLONY, TEXAS CONCERNING THE PROPERTY AT: [INSERT STREET ADDRESS] As the purchaser of the real property described above, you are obligated to pay assessments to the City of The Colony, Texas for the costs of a portion of a public improvement or services project (the “Authorized Improvements”) undertaken for the benefit of the property within “City of The Colony Public Improvement District No. 1” (the “District”) created under Subchapter A, Chapter 372, Local Government Code, as amended. AN ASSESSMENT HAS BEEN LEVIED AGAINST YOUR PROPERTY FOR THE AUTHORIZED IMPROVEMENTS WHICH MAY BE PAID IN FULL AT ANY TIME. IF THE ASSESSMENT IS NOT PAID IN FULL, IT WILL BE DUE AND PAYABLE IN ANNUAL INSTALLMENTS WHICH WILL VARY FROM YEAR TO YEAR DEPENDING ON THE AMOUNT OF INTEREST PAID, COLLECTION COSTS, ADMINISTRATIVE COSTS, AND DELINQUENCY COSTS. The exact amount of the assessment may be obtained from the City of The Colony, Texas. The exact amount of each annual installment will be approved each year by the City Council of The Colony, Texas in the Annual Service Plan Update for the District. More information about the assessments, including the amounts and due dates, may be obtained from the City of The Colony, Texas. YOUR FAILURE TO PAY ANY ASSESSMENT, OR ANY ANNUAL INSTALLMENT THEREOF, MAY RESULT IN PENALTIES AND INTEREST BEING ADDED TO WHAT YOU OWE OR IN A LIEN ON AND THE FORECLOSURE OF YOUR PROPERTY. Exhibit C-4 Exhibit C-4 to The Colony SAP – Form of Notice Required by Texas Property Code Section 5.014 - Page 2 1775.016\874945.7 The undersigned purchaser acknowledges receipt of this notice prior to the effective date of a binding contract for the purchase of the real property at the street address set forth above. [PURCHASER] By: Name: Date: [PURCHASER] By: Name: Date: The undersigned seller executes this notice pursuant to Texas Property Code Section 5.014(a-1), as amended, before the effective date of a binding contract for purchase of the real property at the address described above. [SELLER] By: Name: Date: Exhibit C-4 Exhibit C-4 to The Colony SAP – Form of Notice Required by Texas Property Code Section 5.014 - Page 3 1775.016\874945.7 SECOND NOTICE AFTER RECORDING RETURN TO: [INSERT SELLER NAME AND ADDRESS] NOTICE OF OBLIGATION TO PAY IMPROVEMENT DISTRICT ASSESSMENTS TO THE CITY OF THE COLONY, TEXAS CONCERNING THE PROPERTY AT: [INSERT STREET ADDRESS] As the purchaser of the real property described above, you are obligated to pay assessments to the City of The Colony, Texas for the costs of a portion of a public improvement or services project (the “Authorized Improvements”) undertaken for the benefit of the property within “City of The Colony Public Improvement District No. 1” (the “District”) created under Subchapter A, Chapter 372, Local Government Code, as amended. AN ASSESSMENT HAS BEEN LEVIED AGAINST YOUR PROPERTY FOR THE AUTHORIZED IMPROVEMENTS WHICH MAY BE PAID IN FULL AT ANY TIME. IF THE ASSESSMENT IS NOT PAID IN FULL, IT WILL BE DUE AND PAYABLE IN ANNUAL INSTALLMENTS WHICH WILL VARY FROM YEAR TO YEAR DEPENDING ON THE AMOUNT OF INTEREST PAID, COLLECTION COSTS, ADMINISTRATIVE COSTS, AND DELINQUENCY COSTS. The exact amount of the assessment may be obtained from the City of The Colony, Texas. The exact amount of each annual installment will be approved each year by the City Council of The Colony, Texas in the Annual Service Plan Update for the District. More information about the assessments, including the amounts and due dates, may be obtained from the City of The Colony, Texas. YOUR FAILURE TO PAY ANY ASSESSMENT, OR ANY ANNUAL INSTALLMENT THEREOF, MAY RESULT IN PENALTIES AND INTEREST BEING ADDED TO WHAT YOU OWE OR IN A LIEN ON AND THE FORECLOSURE OF YOUR PROPERTY. The undersigned purchaser acknowledges receipt of this notice prior to the effective date of a binding contract for the purchase of the real property at the street address set forth above. [SIGNATURE PAGES FOLLOW] Exhibit C-4 Exhibit C-4 to The Colony SAP – Form of Notice Required by Texas Property Code Section 5.014 - Page 4 1775.016\874945.7 IN WITNESS WHEREOF, the undersigned parties have executed this notice at the closing of the purchase of the real property at the address described above and for the purposes stated therein. [PURCHASER] By: Name: Date: STATE OF TEXAS § § COUNTY OF DENTON § This instrument was acknowledged before me by ______________________, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he or she executed the same for the purposes therein expressed. Given under my hand and seal of office on this _________________, 20____. __________________________________________ Notary Public, State of Texas [SEAL] [PURCHASER] By: Name: Date: STATE OF TEXAS § § COUNTY OF DENTON § This instrument was acknowledged before me by ______________________, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he or she executed the same for the purposes therein expressed. Given under my hand and seal of office on this _________________, 20____. __________________________________________ Notary Public, State of Texas [SEAL] Exhibit C-4 Exhibit C-4 to The Colony SAP – Form of Notice Required by Texas Property Code Section 5.014 - Page 5 1775.016\874945.7 The undersigned seller acknowledges providing a separate copy of the notice required by Section 5.014 of the Texas Property Code including the current information required by Section 5.0143, Texas Property Code, as amended, at the closing of the purchase of the real property at the address above. [SELLER] By: Name: Date: STATE OF TEXAS § § COUNTY OF DENTON § This instrument was acknowledged before me by ______________________, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he or she executed the same for the purposes therein expressed. Given under my hand and seal of office on this _________________, 20____. __________________________________________ Notary Public, State of Texas [SEAL] Exhibit D to The Colony SAP – Facility Public Improvements Cost Special Benefit Analysis - Page 1 1775.016\874945.7 Exhibit D Special Benefits Report The City of The Colony Public Improvement District No. 1 The Colony, Texas PREPARED BY: Jeremie Maurina, Executive Business Liaison DATED: September 3rd, 2024 Exhibit D to The Colony SAP – Facility Public Improvements Cost Special Benefit Analysis - Page 2 1775.016\874945.7 The Facility is expected to generate eight million customers each year. Given the traffic and security needs of the Facility, above those provided as part of the City's basic municipal services, one hundred percent (100%) of the Public Improvements for the traffic management system/control equipment and one hundred percent (100%) of the enhanced police services are attributable to the Facility Property. The Facility Property is a single economic unit comprised of two tax parcels. The costs attributable the Public Improvements for the traffic management system and enhanced police services are allocated to the two tax parcels based on acreage. During the development related to the Additional Facility Assessments and Related Development Assessments described in the 2018 Annual Service Plan Update, a series of "Enhanced Development Services" (now defined as "Direct Supplemental Services") were identified that provided specific benefits to several individual parcels. Due to the nature of these supplemental services and the scope they cover, they are not easily forecasted for inclusion in a budget. Instead, these costs will be reconciled annually and directly assessed to the parcels that benefitted starting with the Additional Facility Assessments and Related Development Assessments levied in accordance with the 2019 Annual Service Plan update (See Exhibit E for adjusted assessments for the current year). This provides a more accurate assessment and allows the costs of those services to be recovered from the properties that have directly benefited from them. The total of these services is $49,140 for the 2024-25 assessment. The costs related to the Direct Supplemental Services are apportioned to the property that it benefits and levied to the benefited property’s tax ID. A detailed use report of these Direct Supplemental Services is available upon request. Additionally, the City retains a reserve of an estimated 90 days of operating costs calculated based on the annual budget for the Public Improvements. The 90 days of operating costs are apportioned to the Facility Property, waterfront Property and Related Development Property based on the percentages described below. Table D-1 below shows the special benefits analysis. The costs for the traffic management system and enhanced police services shown below are allocated 100% to the Facility Property. The costs for the enhanced development services, lake maintenance, and the street and roadway Public Improvements are allocated on a per-acre basis to the Facility Property, the Waterfront Property and the Related Development Property such that the Facility Property is apportioned approximately 41.66 percent (107.47 Facility Property/257.939495 total acres); the Waterfront Property is apportioned approximately 6.36 percent (16.421 Waterfront Property/257.939495 total acres); and the Related Development Property is apportioned approximately 51.97 percent (134.054995 Related Development Property/257.939495 total acres). [Remainder of page left blank intentionally.] Ex h i b i t D t o T h e C o l o n y S A P – F a c i l i t y P u b l i c I m p r o v e m e n t s C o s t S p e c i a l B e n e f i t A n a l y s i s - P a g e 1 17 7 5 . 0 1 6 \ 8 7 4 9 4 5 . 7 20 2 3 - 2 4 P u b l i c I m p r o v e m e n t C o s t s De s c r i p t i o n o f P u b l i c I m p r o v e m e n t s T o t a l E s t i m a t e d C o s t Co s t A l l o c a t e d t o Fa c i l i t y P r o p e r t y Co s t A l l o c a t e d t o Wa t e r f r o n t P r o p e r t y Co s t A l l o c a t e d t o Re l a t e d D e v e l o p m e n t Pr o p e r t y Tr a f f i c m a n a g e m e n t s y s t e m $ 4 7 , 2 5 6 . 5 2 $ 4 7 , 2 5 6 . 5 2 $ 0 $ 0 En h a n c e d p o l i c e s e r v i c e s $ 2 5 3 , 9 9 4 . 1 5 $ 2 5 3 , 9 9 4 . 1 5 $ 0 $ 0 En h a n c e d d e v e l o p m e n t s e r v i c e s $ 0 $ 0 $ 0 $ 0 St r e e t a n d r o a d w a y i m p r o v e m e n t $ 8 2 2 , 2 0 0 $ 3 4 2 , 5 6 8 . 0 7 $ 5 2 , 3 2 2 . 3 6 $ 4 2 7 , 3 0 9 . 5 8 La k e m a i n t e n a n c e $ 2 9 , 0 0 0 $ 1 2 , 0 8 2 . 7 9 $ 1 , 8 4 5 . 4 7 $ 1 5 , 0 7 1 . 7 3 PU B L I C I M P R O V E M E N T T O T A L S $ 1 , 1 5 2 , 4 5 0 . 6 7 $ 6 5 5 , 9 0 1 . 5 3 $ 5 4 , 1 6 7 . 8 3 $ 4 4 2 , 3 8 1 . 3 1 90 D a y s O p e r a t i n g C o s t R e s e r v e $ 2 8 4 , 1 6 5 . 9 2 $ 1 1 8 , 3 9 7 . 1 9 $ 1 8 , 0 8 3 . 4 7 $ 1 4 7 , 6 8 5 . 2 6 An n u a l D i r e c t S u p p l e m e n t a l S e r v i c e s Co s t s $4 9 , 1 4 0 0 0 $ 4 9 , 1 4 0 TO T A L S 1, 4 8 5 , 7 5 6 . 5 9 $7 7 4 , 2 9 8 . 7 2 $ 7 2 , 2 5 1 . 3 0 $ 6 3 9 , 2 0 6 . 5 7 Ex h i b i t D t o T h e C o l o n y S A P – F a c i l i t y P u b l i c I m p r o v e m e n t s C o s t S p e c i a l B e n e f i t A n a l y s i s - P a g e 2 17 7 5 . 0 1 6 \ 8 7 4 9 4 5 . 7 20 2 3 - 2 4 P u b l i c I m p r o v e m e n t C o s t s B e n e f i t A l l o c a t i o n Pu b l i c I m p r o v e m e n t s T O T A L S Sp e c i a l B e n e f i t t o Fa c i l i t y P r o p e r t y Sp e c i a l B e n e f i t t o Wa t e r f r o n t P r o p e r t y Sp e c i a l B e n e f i t t o Re l a t e d D e v e l o p m e n t Pr o p e r t y Tr a f f i c m a n a g e m e n t sy s t e m $4 7 , 2 5 6 . 5 2 1 0 0 % 0 % 0 % En h a n c e d p o l i c e s e r v i c e s $2 5 3 , 9 9 4 . 1 5 1 0 0 % 0 0 % En h a n c e d d e v e l o p m e n t se r v i c e s $0 4 1 . 6 6 % 6 . 3 6 % 5 1 . 9 7 % St r e e t a n d r o a d w a y im p r o v e m e n t s $8 2 2 , 2 0 0 . 0 0 4 1 . 6 6 % 6 . 3 6 % 5 1 . 9 7 % La k e m a i n t e n a n c e $ 2 9 , 0 0 0 . 0 0 4 1 . 6 6 % 6 . 3 6 % 5 1 . 9 7 % TO T A L S $ 1 , 1 5 2 , 4 5 0 . 6 7 90 D a y s O p e r a t i n g C o s t Re s e r v e $2 8 4 , 1 6 6 4 1 . 6 6 % 6 . 3 6 % 5 1 . 9 7 % An n u a l D i r e c t Su p p l e m e n t a l S e r v i c e s Co s t s $4 9 , 1 4 0 1 0 0 % TO T A L S 1, 4 8 5 , 7 5 6 . 5 9 Exhibit E Assessment Roll Exhibit E to The Colony SAP – Assessment Roll - Page 1 1775.016\874945.7 1. Outstanding 2013 Facility Public Improvement Assessment levied against Facility Property consisting of Tax Parcels No. 657618 and 657619 is $77,845.63. 2. Assessment Roll for Additional Facility Public Improvements, Waterfront Public Improvements and Related Development Public Improvements as levied by the 2024 Assessment Ordinance: Tax Parcel Assessment Facility Property ($613,682.54) #657618 – 81.99 acres ~76.29% $468,184.90 #657619 – 25.48 acres ~23.71% $145,497.64 Waterfront Property ($47,719.48) #957987 – 13.774 acres~83.91% $40,043.14 #704832 – 0.675 acres~4.11% $1,962.33 #957988 - .506 acres ~3.08% $1,471.02 #957989 – 0.2976 acres ~1.81% $865.17 #957990 – 0.2717 acres ~ 1.66% $789.87 #957991 – 0.4838 acres ~ 2.95% $1,406.48 #957992 – 0.4064 acres ~ 2.48% $1,181.47 Related Development Property ($438,858.56) #692390 – 2.015 acres ~ 1.50% $5,857.92 #692391 – 2.105 acres ~ 1.57% $6,119.56 #653843 – 2.944 acres ~ 2.20% $8,558.66 #653844 – 2.683 acres ~ 2.00% $7,799.90 #674231 – 3.386 acres ~ 2.53% $9843.62 #692387 – 1.903 acres ~ 1.42% $5532.31 #692388 – 0.301 acres ~ 0.22% $875.05 #692379 – 2.931 acres ~2.19% $8,520.87 #692380 – 0.204 acres ~ 0.15% $593.06 #732382 – 8.551 acres ~ 6.38% $25,129.08 #748393 – 79.089 acres ~ 59.00% $245,224.95 #753491 – 5.839 acres ~ 4.36% $16,974.54 #753492 – 1.574 acres ~ 1.17% $4,575.16 #674218-3.645 acres ~2.72% $19,956.58 Exhibit E Assessment Roll Exhibit E to The Colony SAP – Assessment Roll - Page 2 1775.016\874945.7 #692389-1.925 acres ~1.44% $5,596.27 #1004631- 1.029 acres ~.77% $2,991.46 #1003642- 3.581 acres ~2.67% $15,540.52 #1015683- 10.35 acres ~7.72% $49,169.05 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 1 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 2 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 3 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 4 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 5 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 6 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 7 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 8 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 9 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 10 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 11 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 12 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 13 1775.016\874945.7 E-1 Bond Debt Service Schedules for Calculating Debt Service Shortfalls Exhibit E-1 to The Colony SAP – Bond Debt Service Schedules for Calculating Debt Service Shortfalls - Page 14 1775.016\874945.7 20545 Exhibit F Chronological History of City Council Legislative Actions for the District Exhibit F to The Colony SAP –- Chronological History of City Council Legislative Actions for the District - Page 1 1775.016\874945.7 Below is a summary of prior legislative actions of the City Council for the District, including the levy of all Assessments against benefitted property within the District. This Exhibit F shall be updated with each Annual Service Plan Update. Items marked with an (**) were validated as part of the matter styled Ex Parte City of The Colony in the 53rd District Court of Travis County, Texas (the "Bond Validation Suit") for which a Final Judgment was issued on January 18, 2012. September 17, 2012**Landowner petition ("PID Creation Petition") for the establishment of the District is submitted to the City and filed with the City Secretary. September 18, 2012 City Council approved Resolution No. 2012-067 accepting the PID Creation Petition and calling a public hearing on the creation of the District for October 8, 2012. September 21, 2012**Notice of "City of The Colony, Texas, Notice of Public Hearing Regarding the Proposed Establishment of City of The Colony Public Improvement District No. 1" is mailed to "Property Owners" as required by the Act. September 22, 2012**Notice of "City of The Colony, Texas, Notice of Public Hearing Regarding the Proposed Establishment of City of The Colony Public Improvement District No. 1" is published in the Denton Record Chronicle as required by the Act. September 26, 2012**City Council by motion accepts and approves PID Creation Petition, waiver of the 15-day notice for the public hearing on the creation of the District to be held on October 8, 2012, and waiver of the 20-day protest period for the commencement of construction of the Authorized Improvements. October 8, 2012**After considering all written and documentary evidence presented at the public hearing described above, City Council approved Resolution No. 2012-073 authorizing the creation of the District. October 9, 2012**Publication of Resolution No. 2012-073 authorizing the creation of the District as required by the Act. December 11, 2012 City Council approved Resolution No. 2012-100 accepting a preliminary service and assessment plan, proposed assessment roll and proposed reimbursement agreement for the District and calling a public hearing ("2013 Assessment Hearing") for January 15, 2013 to consider an ordinance levying assessments on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. December 17, 2012**Notice of "City of The Colony, Texas, Notice of Public Hearing on Assessment Ordinance for the City of The Colony Public Improvement District No. 1" is mailed to "Property Owners" as required by the Act. December 19, 2012**Notice of "City of The Colony, Texas, Notice of Public Hearing on Assessment Ordinance for the City of The Colony Public Improvement District No. 1" is published in the Denton Record Chronicle as required by the Act. January 15, 2013 City Council conducted the 2013 Assessment Public Hearing and approved a motion to continue the 2013 Assessment Public Hearing to February 7, 2013. Exhibit F Chronological History of City Council Legislative Actions for the District Exhibit F to The Colony SAP –- Chronological History of City Council Legislative Actions for the District - Page 2 1775.016\874945.7 February 7, 2013**After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. 2013-1992, recorded as Instrument No. 2013-20487 in the real property records of Denton County, Texas (the “2013 Assessment Ordinance”), which (i) approved and accepted the “City of The Colony, Texas, Public Improvement District No. 1 Service and Assessment Plan” dated February 7, 2013 (the “Original Service and Assessment Plan”), (ii) levied the 2013 Facility Public Improvement Assessment against the Facility Property for the 2013 Public Improvements as shown on the Assessment Roll attached as Exhibit G to the Original Service and Assessment Plan, and (iii) deferred levying the 2013 Related Development Deferred Assessment for the portion of the 2013 Public Improvements Cost that specially benefits the Related Development Property. City Council approved Resolution No 2013-008 approving the 2013 LGC Sales Tax Bonds, the 2013A LGC Sales Tax Bonds, and the 2013 LGC Tax Bonds and approving the 2013 LGC Sales Tax Bonds Reimbursement Agreement and the 2013 LGC Tax Bonds Reimbursement Agreement. City Council approved Resolution No. 2013-009 approving the 2013 Type A Bonds and approving the 2013 Type A Bonds Reimbursement Agreement. City Council approved Resolution No. 2013-010 approving the 2013 Type B Bonds and approving the 2013 Type B Bonds Reimbursement Agreement. April 21, 2015 City Council approved Resolution No. 2015-042 accepting the City of The Colony Public Improvement District No. 1 Preliminary 2015 Annual Service and Assessment Plan, dated March 17, 2015, including proposed assessment roll for the District and calling a public hearing ("2015 Assessment Public Hearing") for May 5, 2015 to consider an ordinance levying assessments in the aggregate amount of $1,379,301.00 on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. May 5, 2015 After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2015 Assessment Public Hearing. After considering all written and documentary evidence presented at the duly noticed public hearing described above, the City Council approved Ordinance No. 2015-2136 (the "2015 Assessment Ordinance") which approved the 2015 Annual Service Plan Update and levied Assessments in the aggregate amount of $1,379,301 consisting of: (i) $959,247.96 against the Facility Property for costs of Additional Facility Public Improvements (the "2015 Facility Assessment"), (ii) $369,143.53 for Boardwalk Public Improvement Costs (as defined in the 2015 Annual Service Plan Update) and $50,909.51 for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively, the aggregate $420,053.04 amount is referred to as the "2015 Related Development Assessment") August 18, 2015 City Council approved Resolution No. 2015-066 accepting the City of The Colony Public Improvement District No. 1 Preliminary 2015-16 Annual Service and Assessment Plan, dated August 13, 2015, including proposed assessment roll for the District, and calling a public hearing ("2015-16 Assessment Public Hearing") for September 1, 2015 to consider an ordinance levying assessments in the aggregate amount of $1,454,992.00 on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. Exhibit F Chronological History of City Council Legislative Actions for the District Exhibit F to The Colony SAP –- Chronological History of City Council Legislative Actions for the District - Page 3 1775.016\874945.7 September 15, 2015 After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2015-16 Assessment Public Hearing. After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. 2015-2160 (the "2015 Assessment Ordinance") which approved the 2015 Annual Service Plan Update and levied Assessments in the aggregate amount of $1,454,992 consisting of: (i) $1,218,234.83 against the Facility Property for costs of Additional Facility Public Improvements (the "2015 Facility Assessment"), (ii) $148,428.69 for Boardwalk Public Improvement Costs (as defined in the 2015 Annual Service Plan Update) and $88,328.48 for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively, the aggregate $236,757.17 amount is referred to as the "2015 Related Development Assessment") August 16, 2016 City Council approved Resolution No. 2016-049 accepting the City of The Colony Public Improvement District No. 1 Preliminary 2016-17 Annual Service and Assessment Plan, dated August 10, 2016, including proposed assessment roll for the District, and calling a public hearing ("2016 Assessment Public Hearing") for September 6, 2016 to consider an ordinance levying assessments in the aggregate amount of $1,162,836.00 on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. September 6, 2016 After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2016 Assessment Public Hearing. After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. 2016-2232 (the "2016 Assessment Ordinance") which approved the 2016 Annual Service Plan Update and levied Assessments in the aggregate amount of $1,162,836.00 consisting of: (i) $875,155.64 against the Facility Property for costs of Additional Facility Public Improvements (the "2016 Facility Assessment"), (ii) $120,673.24 for Boardwalk Public Improvement Costs (as defined in the 2016 Annual Service Plan Update) and $167,007.12 for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively, the aggregate $287,681.36 amount is referred to as the "2016 Related Development Assessment"). September 5, 2017 City Council approved Resolution No. 2017-078 accepting the City of The Colony Public Improvement District No. 1 Preliminary 2017-18 Annual Service and Assessment Plan, dated August 16, 2017, including proposed assessment roll for the District, and calling a public hearing ("2017 Assessment Public Hearing") for September 19, 2017 to consider an ordinance levying assessments in the aggregate amount of $1,531,458.00 on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. September 19, 2017 After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2017 Assessment Public Hearing. After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. 2017-2283 (the "2017 Assessment Ordinance") which approved the 2017 Annual Service Plan Update and levied Assessments in the aggregate amount of $1,531,458 consisting of: (i) $658,465 against the Exhibit F Chronological History of City Council Legislative Actions for the District Exhibit F to The Colony SAP –- Chronological History of City Council Legislative Actions for the District - Page 4 1775.016\874945.7 September 19, 2017 (continued) Facility Property for costs of Additional Facility Public Improvements (the "2017 Facility Assessment"), (ii) $402,978 for Waterfront Public Improvement Costs (as defined in the 2017 Annual Service Plan Update) and $470,015 for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively, the aggregate $872,993 amount is referred to as the "2017 Related Development Assessment"). August 21, 2018 City Council approved Resolution No. 2018-071 accepting the City of The Colony Public Improvement District No. 1 Preliminary 2018-19 Annual Service and Assessment Plan, dated August 16, 2018, including proposed assessment roll for the District, and calling a public hearing ("2018 Assessment Public Hearing") for September 18, 2018 to consider an ordinance levying assessments in the aggregate amount of $1,497,805.98 on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. September 18, 2018 After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2018 Assessment Public Hearing. After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. 2018-2235 (the "2018 Assessment Ordinance") which approved the 2018 Annual Service Plan Update and levied Assessments in the aggregate amount of $1,497,805.98 consisting of: (i) $810,379.62 against the Facility Property for costs of Additional Facility Public Improvements (the "2018 Facility Assessment"), (ii) $83,293.66 for Waterfront Public Improvement Costs (as defined in the 2018 Annual Service Plan Update) and $604,132.70 for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively, the aggregate $687,426.36 amount is referred to as the "2018 Related Development Assessment"). August 20, 2019 City Council approved Resolution No. 2019-065 accepting the City of The Colony Public Improvement District No. 1 Preliminary 2019-20 Annual Service and Assessment Plan, dated August 15, 2019, including proposed assessment roll for the District, and calling a public hearing ("2019 Assessment Public Hearing") for September 17, 2019 to consider an ordinance levying assessments in the aggregate amount of $1,061,109.02 on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. September 17, 2019 After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2019 Assessment Public Hearing. After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. 2019-2376 (the "2019 Assessment Ordinance") which approved the 2019 Annual Service Plan Update and levied Assessments in the aggregate amount of $1,061,109.02 consisting of: (i) $570,667.99 against the Facility Property for costs of Additional Facility Public Improvements (the "2019 Facility Assessment"), (ii) $49,965.50 for Waterfront Public Improvement Costs (as defined in the 2019 Annual Service Plan Update) and $440,475.53 for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively, the aggregate $490,441.03 amount is referred to as the "2019 Related Development Assessment"). Exhibit F Chronological History of City Council Legislative Actions for the District Exhibit F to The Colony SAP –- Chronological History of City Council Legislative Actions for the District - Page 5 1775.016\874945.7 August 5, 2020 City Council approved Ordinance No. 2020-2403 accepting the City of The Colony Public Improvement District No. 1 Preliminary 2020-21 Annual Service and Assessment Plan, dated August 13, 2020, including proposed assessment roll for the District, and calling a public hearing ("2020 Assessment Public Hearing") for September 15, 2020 to consider an ordinance levying assessments in the aggregate amount of $1,061,109.02 on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. September 15, 2020 After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2020 Assessment Public Hearing. After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. 2020-2407 (the "2020 Assessment Ordinance") which approved the 2020 Annual Service Plan Update and levied Assessments in the aggregate amount of $1,061,109.02 consisting of: (i) $570,667.99 against the Facility Property for costs of Additional Facility Public Improvements (the "2020 Facility Assessment"), (ii) $49,965.50 for Waterfront Public Improvement Costs (as shown in Exhibit B of the 2020 Assessment Ordinance) and $440,475.53 for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively, the aggregate $490,441.03 amount is referred to as the "2020 Related Development Assessment"). January 19, 2021 City Council approved Ordinance No. 2021-2430 approving an Approving an Amended and Restated Service and Assessment Plan for the District, Including Assessment Roll for The City of The Colony Public Improvement District No. 1. City Council approved Resolution No. 2021-006 approving and Consenting to The Colony Local Development Corporation Tax Increment Contract Revenue Refunding Bonds (Nebraska Furniture Mart Texas Project) Taxable Series 2021. August 17th, 2021 City Council approved Resolution No. 2021-053 accepting the City of The Colony Public Improvement District No. 1 Preliminary 2021-22 Annual Service and Assessment Plan, dated August 13, 2020, including proposed assessment roll for the District, and calling a public hearing ("2021 Assessment Public Hearing") for September 7, 2021 to consider an ordinance levying assessments in the aggregate amount of $902,327on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. September 7th, 2021 After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2021 Assessment Public Hearing. After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. 2021-2449 (the "2021 Assessment Ordinance") which approved the 2021 Annual Service Plan Update and levied Assessments in the aggregate amount of $902,327consisting of: (i) $535,879.94 against the Facility Property for costs of Additional Facility Public Improvements (the "2021 Facility Assessment"), (ii) $41,034.82 for Waterfront Public Improvement Costs (as shown in Exhibit B of the 2021 Assessment Ordinance) and $325,412.13 for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively, the aggregate $366,446.95amount is referred to as the "2021Related Development Assessment"). The 2021 Assessment Ordinance was recorded as Document No. 168472 on September 14th, 2021 in the Real Property Records of Denton County. Exhibit F Chronological History of City Council Legislative Actions for the District Exhibit F to The Colony SAP –- Chronological History of City Council Legislative Actions for the District - Page 6 1775.016\874945.7 August 16th, 2022 City Council approved Resolution No. 2022-054 accepting the City of The Colony Public Improvement District No. 1 Preliminary 2022-23 Annual Service and Assessment Plan, dated August 14th, 2022, including proposed assessment roll for the District, and calling a public hearing ("2022 Assessment Public Hearing") for September 6, 2022 to consider an ordinance levying assessments in the aggregate amount of $1,304,422 on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. October 18th, 2022 After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2022 Assessment Public Hearing. After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. 2022-2491 (the "2022 Assessment Ordinance") which approved the 2022 Annual Service Plan Update and levied Assessments in the aggregate amount of $1,304,421.76 consisting of: (i) $731,985.36 against the Facility Property for costs of Additional Facility Public Improvements (the "2022 Facility Assessment"), (ii) $68,245.18 for Waterfront Public Improvement Costs (as shown in Exhibit B of the 2022 Assessment Ordinance) and $504,191.22 for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively, the aggregate $572,436.40amount is referred to as the "2021 Related Development Assessment"). The 2022 Assessment Ordinance was recorded as Document No. 149037 on October 21 st, 2022 in the Real Property Records of Denton County. August 15th, 2023 City Council approved Resolution No. 2023-057 accepting the City of The Colony Public Improvement District No. 1 Preliminary 2023-24 Annual Service and Assessment Plan, dated August 15th, 2023, including proposed assessment roll for the District, and calling a public hearing ("2023Assessment Public Hearing") for September 5th, 2023 to consider an ordinance levying assessments in the aggregate amount of $1,335,447 on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. September 19th, 2023 After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2023 Assessment Public Hearing. After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. 2023-2535 (the "2023 Assessment Ordinance") which approved the 2023 Annual Service Plan Update and levied Assessments in the aggregate amount of $1,335,447 consisting of: (i) $691,853.18 against the Facility Property for costs of Additional Facility Public Improvements (the "2023 Facility Assessment"), (ii) $61,601.36 for Waterfront Public Improvement Costs (as shown in Exhibit B of the 2023Assessment Ordinance) and $581,992.92for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively,the aggregate $643,594.28amount is referred to as the "2023Related Development Assessment"). The 2023 Assessment Ordinance was recorded as Document No. 101705 on September 20th, 2023 in the Real Property Records of Denton County. [September 3rd , 2024]City Council approved Resolution No. xxxxxxxx accepting the City of The Colony Public Improvement District No. 1 Preliminary 2024-25 Annual Service and Assessment Plan, dated September 3rd ,2023, including proposed assessment roll for the District, and calling a public hearing ("2024Assessment Public Hearing") for September 17th, 2024 to consider Exhibit F Chronological History of City Council Legislative Actions for the District Exhibit F to The Colony SAP –- Chronological History of City Council Legislative Actions for the District - Page 7 1775.016\874945.7 an ordinance levying assessments in the aggregate amount of $1,100,261 on benefitted property within the District, and directing publication and mailing of statutory notices for such hearing. [September 17th, 2024]After notice was properly mailed and published and required by the PID Act, the City Council conducted the 2024 Assessment Public Hearing. After considering all written and documentary evidence presented at the public hearing described above, the City Council approved Ordinance No. XXXXX (the "2024 Assessment Ordinance") which approved the 2024 Annual Service Plan Update and levied Assessments in the aggregate amount of $1,100,261 consisting of: (i) $613,682.54 against the Facility Property for costs of Additional Facility Public Improvements (the "2024 Facility Assessment"), (ii) $47,719.48 for Waterfront Public Improvement Costs (as shown in Exhibit B of the 2024Assessment Ordinance) and $438,858.56for Related Development Public Improvements Costs against the benefitted portions of the Related Development Property (collectively, the aggregate $486,578.04amount is referred to as the "2024Related Development Assessment"). The 2024 Assessment Ordinance was recorded as Document No. XXXXXXXon September XXX, 2024in the Real Property Records of Denton County. CITY OF THE COLONY, TEXAS ORDINANCE NO. 2024 - ________ AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, RELATED TO THE CITY OF THE COLONY PUBLIC IMPROVEMENT DISTRICT NO. 1; APPROVING A SERVICE AND ASSESSMENT PLAN FOR THE DISTRICT FOR FISCAL YEAR 2024-2025 ANNUAL FACILITY PUBLIC IMPROVEMENTS, WATERFRONT PUBLIC IMPROVEMENTS, AND RELATED DEVELOPMENT PUBLIC IMPROVEMENTS FOR DEVELOPED PROPERTIES WITHIN THE DISTRICT CONSISTING OF THE FACILITY PROPERTY, WATERFRONT PROPERTY AND RELATED DEVELOPMENT PROPERTY; APPROVING AN ASSESSMENT ROLL FOR THE FACILITY PROPERTY, WATERFRONT PROPERTY, AND RELATED DEVELOPMENT PROPERTY WITHIN THE DISTRICT; LEVYING A SPECIAL ASSESSMENT AGAINST THE FACILITY PROPERTY, WATERFRONT PROPERTY, AND RELATED DEVELOPMENT PROPERTY WITHIN THE DISTRICT TO PAY FOR FISCAL YEAR 2024-2025 ANNUAL FACILITY PUBLIC IMPROVEMENTS, WATERFRONT PUBLIC IMPROVEMENTS, AND RELATED DEVELOPMENT PUBLIC IMPROVEMENTS; PROVIDING FOR THE COLLECTION OF THE SPECIAL ASSESSMENTS; CREATING A CHARGE AND LIEN AGAINST SAID PROPERTIES; RATIFYING AND CONFIRMING PRIOR ACTIONS RELATED TO THE DISTRICT; PROVIDING PENALTIES FOR DELINQUENT SPECIAL ASSESSMENTS; CREATING A DISTRICT PROJECT FUND; PROVIDING FINDINGS AND DETERMINATIONS BY AND RELATED TO THE DISTRICT; PROVIDING A SEVERABILITY CLAUSE; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, Chapter 372 of the Texas Local Government Code (hereinafter referred to as the “Act”) authorize the City of The Colony, Texas, to create a public improvement district within the City of The Colony, Texas; and WHEREAS,on Monday, September 17, 2012, there was presented to the City of The Colony, Texas (hereinafter referred to as the “City”) a petition (hereinafter referred to as the “Petition”) seeking the authorization to establish a public improvement district (hereinafter referred to as the “District”) within the City pursuant to Chapter 372 of the Texas Local Government Code, as amended, for an approximately 439.12 acre tract or tracts of land, a legal description is attached hereto as Exhibit A; and WHEREAS,on Tuesday, September 18, 2012, the City Council for the City approved Resolution No. 2012-067, ordering a public hearing for October 8, 2012 (hereinafter referred to as the “Creation Public Hearing”), to consider a resolution creating the District; and WHEREAS, on or before September 22, 2012, the City Secretary mailed and caused to be published notice of the Creation Public Hearing as required by the Act, which date was before the 15th day before the date of the Creation Public Hearing; and WHEREAS, after mailing, publishing, and otherwise providing all notices of the Creation Public Hearing as required by the Act and state law, the City Council conducted the Creation Public Hearing on October 8, 2012, at the time and place and for the purposes set forth in the notices; and WHEREAS, Owner appeared at the Creation Public Hearing by its representative and affirmed Owner’s request to create the District; and WHEREAS, no one appeared at the Creation Public Hearing in opposition to the creation of the District; and WHEREAS, after all persons having an interest in the District were given an opportunity to be heard in support of or in opposition to the creation of the District, the City Council closed the Creation Public Hearing on October 8, 2012, and by a majority vote of all members of the City Council adopted and approved Resolution No. 2012-073 creating the District; and WHEREAS, on October 9, 2012, the City Secretary caused notice of Resolution No. 2012-073 to be published as required by the Act; whereupon the creation of the District took effect as provided by the Act; and WHEREAS, on Tuesday, September 3, 2024, the City Council approved the City of The Colony Public Improvement District No. 1, Preliminary 2024-2025 Annual Service and Assessment Plan, dated September 3, 2024, for properties within the District, including (i) a determination of the cost of the public improvements and supplemental services being provided for the special benefit of the District; (ii) a service plan; (iii) an assessment plan; and (iv) an assessment roll (collectively, the “Preliminary 2024-2025 Annual SAP”); and WHEREAS, the City Council held a public hearing for Tuesday, September 17, 2024, to consider an ordinance levying assessments against the Property to pay for the public improvements identified in the Preliminary 2024-2025Annual SAP that will confer a special benefit on the Property and authorizes and directs the City Secretary to publish and mail notices of said public hearing in accordance with the Act; and WHEREAS, the City Council hereby approves the City of The Colony Public Improvement District No. 1, Final 2024-2025 Annual Service and Assessment Plan for properties within the District, including (i) a determination of the cost of the public improvements and supplemental services being provided for the special benefit of the District; (ii) a service plan; (iii) an assessment plan; and (iv) an assessment roll (collectively, the “Final 2024-2025Annual SAP”), which is attached hereto as Exhibit C. NOW THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, THAT: SECTION 1.The recitals set forth in the WHEREAS clauses of this Ordinance are true and correct, are part of this Ordinance for all purposes, and constitute findings and determinations of the City Council acting in its discretionary, legislative capacity. SECTION 2.The City Council has investigated and determined and hereby ratifies and confirms that: 2.1 The matters set forth in the Petition are true and correct; 2.2 The Petition complies with all requirements of the Act and is sufficient under the Act for all purposes including, but not limited to, the creation of the District; 2.3 The Facility Public Improvements, Waterfront Public Improvements, and Related Development Public Improvements more particularly described in the Service and Assessment Plan, attached hereto as Exhibit B are authorized by the Act, promote the interests of the City, and confer a special benefit on the Facility Property, Waterfront Property, and the Related Development Property; 2.4 The form, content, timing, and method for providing notice of the Creation Public Hearing, and all matters related to the conduct of the Creation Public Hearing and the adoption of Resolution No. 2012-073 creating the District were in accordance with the Act, state law, and the City Charter and ordinances of the City; 2.5 Prior to conducting the Assessment Hearing and the adoption of this Ordinance, the City Council determined the total cost of the Facility Public Improvements, Waterfront Public Improvements, and Related Development Public Improvements based on Official Reports and filed with the City Secretary and made available for public inspection the Preliminary 2024-2025 Annual SAP; 2.6 The form, content, timing, and method for providing the notice of the Assessment Hearing, and all matters related to the conduct of the Assessment Hearing and the adoption of this Ordinance, were in accordance with the Act, state law, and the City Charter and ordinances of the City; 2.7 The City Council has provided opportunity for the owners of property liable for the special assessments, and for the public at large, to appear, in person or by their representatives, and present objections to the creation of the District and the levy of the special assessments; however, no objections to the creation of the District or to the levy of the special assessments against the Facility Property, Waterfront Property, and the Related Development Property were presented; and 2.8 All actions taken by the City Council in connection with the District have been taken and performed in accordance with the Act, state law, and the City Charter and ordinances of the City and in a regular, proper, and valid manner. SECTION 3.The City of the Colony Public Improvement District No. 1 2024-2025 Annual Service and Assessment Plan, a copy of which is attached hereto as Exhibit C, and is incorporated herein for all purposes (as updated, from time to time, the “Service and Assessment Plan”) is hereby approved by the City Council as the “service plan,” “assessment plan,” and “assessment roll” as the 2024-2025 Annual Service and Assessment Plan for the Facility Property, Waterfront Property, and the Related Development Property as required by the Act, and is incorporated as part of this Ordinance for all purposes. The Service and Assessment Plan shall be updated by the City Council no less frequently than annually as required by the Act and more frequently as required by the Service and Assessment Plan. A copy of the Service and Assessment Plan, as updated from time to time, is available from the City Secretary. SECTION 4.Unless otherwise defined in this Ordinance, capitalized terms used in this Ordinance shall have the meanings given to them in the Service and Assessment Plan. SECTION 5.Based on the Service and Assessment Plan, attached hereto as Exhibit C, the City Council hereby levies a Special Assessment (as a “special assessment” under the Act) upon the Facility Property, Waterfront Property, and the Related Development Property in the amounts set forth in Exhibit B of this Ordinance, which is attached hereto and incorporated herein for all purposes. SECTION 6. Each Special Assessment against the Facility Property, Waterfront Property, and the Related Development Property, together with interest, the expenses of collection, and reasonable attorney’s fees, if incurred, constitutes a lien against the Facility Property, Waterfront Property, and the Related Development Property (the priority of which is established by the Act) and is the personal liability of and charge against the owner of the Facility Property, Waterfront Property, and the Related Development Property regardless of whether the owner is named in this Ordinance. SECTION 7.The assessment lien against the Facility Property, Waterfront Property, and the Related Development Property created by the Special Assessment is effective from the date of this Ordinance and “runs with the land.” The assessment lien against the Facility Property, Waterfront Property, and the Related Development Property may be enforced by the City, including foreclosure, in the same manner that an ad valorem tax lien is foreclosed. Any purchaser of the Facility Property, Waterfront Property, and the Related Development Property in foreclosure takes subject to the lien against the Facility Property, Waterfront Property, and the Related Development Property created by the Special Assessment. SECTION 8. The Special Assessments against the Facility Property, Waterfront Property, and the Related Development Property as set forth in Exhibit B of this Ordinance are due and payable not later than January 31, 2025, and will be delinquent on February 1, 2025. Delinquent Special Assessments shall incur interest, penalties, and attorney's fees in the same manner as delinquent ad valorem taxes. SECTION 9. The City (or any other person, entity, or governmental agency permitted by law) shall bill, collect, and immediately deposit Assessment Revenue into a segregated operating account, the PID Operating Account for Annual Assessments, as provided by the Service and Assessment Plan. The PID Operating Account for Annual Assessments (and the sub-accounts thereof) shall be created by the City and shall be segregated from all other funds of the City. The City shall only use the funds in the PID Operating Account for Annual Assessments for the purposes determined by the City Council at the time the Special Assessments are levied. SECTION 10. Based on materials and information prepared by City staff and qualified professional consultants, on testimony provided throughout the process of creating the District and levying the Special Assessments including, but not limited to, testimony offered at the Creation Public Hearing and Assessment Hearing, and on other information, materials, evidence, and testimony availableto or provided to the City Council for its consideration, the City Council, acting in its discretionary, legislative capacity, hereby finds and determines: 10.1 That the Facility Property, Waterfront Property, and the Related Development Property are specially benefited by the Facility Public Improvements, Waterfront Public Improvements and Related Development Improvements, as applicable, in an amount that exceeds the Special Assessments levied against the Facility Property, Waterfront Property, and the Related Development Property; 10.2 That the Special Assessments against the Facility Property, Waterfront Property, and the Related Development Property: (i) is just and equitable; (ii) produces substantial equality, considering the benefits received and the burdens imposed; (iii) results in imposing equal shares of the cost of the Public Improvements on property within the District that is similarly benefitted; and (iv) is authorized by and has been levied in accordance with the Act, state law, City Charter, and the ordinances of the City; 10.3 That all prerequisites to the fixing of the Special Assessment lien against the Facility Property, Waterfront Property, and the Related Development Property, and to the personal liability of the real and true owner of the Facility Property, Waterfront Property, and the Related Development Property, whether named in this Ordinance or not, have been in all things regularly and duly performed in compliance with the Act and all other applicable laws, ordinances, regulations, procedures, and policies; and 10.4 That the Special Assessments levied against the Facility Property, Waterfront Property, and the Related Development Property are in amounts required to pay the cost of the Public Improvements. SECTION 11. The City Council may make supplemental assessments to correct omissions or mistakes related to the cost of the Public Improvements and reassessments if the City Council determines that any special assessment is excessive. The City Council may also adjust Special Assessments downward following each annual update to the Service and Assessment Plan. SECTION 12. This Ordinance incorporates, by reference, all provisions of the Act. In the event of any conflict between this Ordinance and the Act, the Act shall control. SECTION 13. If any provision of this Ordinance, or the application of any provision to any person or set of circumstances, is held by any court to be invalid, the remaining provisions shall be unaffected. All provisions of this Ordinance are severable for such purpose. SECTION 14. This Ordinance shall take effect effective immediately upon passage and approval by the City Council. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, THIS THE 17TH DAY OF SEPTEMBER, 2024. APPROVED: Richard Boyer, Mayor City of The Colony, Texas ATTEST: Tina Stewart, TRMC, CMC, City Secretary APPROVED AS TO FORM: Jeffrey L. Moore, City Attorney ACKNOWLEDGMENT STATE OF TEXAS § § COUNTY OF DENTON § This instrument was acknowledged before me on the 17th day ofSeptember, 2024, by Richard Boyer, Mayor of the City of The Colony, Texas, a Texas home-rule municipality, on behalf of said municipality. ____________________________________ Notary Public, State of Texas Exhibit A Legal Description of the Property (439.12 Acres) Being a 439.12 acre tract of land situated in the B.B.B & C.R.R. Survey, Abstract No. 173, B.B.B. & C. Survey, Abstract No. 174, Thomas A. West Survey, Abstract No. 1344, and the M.D.T. Hallmark Survey, Abstract No. 570, Denton County, Texas, and being all of a tract of land conveyed by deed to 121 Acquisition Company, LLC., as recorded in Instrument No. 2011- 114773, 2011-121444, and 2011-112195, Deed Records, Denton County, Texas, and a portion of Plano Parkway and a portion of Burlington Northern Railroad tract, and being more particularly described as follows: BEGINNING at a found Txdot monument, said point being the northwest corner of said 121 Acquisition Company, LLC tract and being in the south right-of-way line of State Highway 121 (having a variable width R.O.W.); THENCE North 63°32'06" East, along said south right-of-way line, a distance of 130.52 feet to a point for corner; THENCE North 60°22'33" East, continuing along said south right-of-way line, a distance of 80.86 feet to a point for corner; THENCE South 29°13'03" East, continuing along said south right-of-way line, a distance of 50.00 feet to a point for corner; THENCE North 60°47'38" East, continuing along said south right-of-way line, a distance of 219.64 feet to a point for corner, said point being in the west right-of-way line of Plano Parkway (100 ft R.O.W.); THENCE North 50°53'35" East, leaving said south right-of-way line, and leaving said west right- of-way line, a distance of 100.00 feet to a point for corner, for the beginning of a non-tangent curve to the right having a radius of 950.00 feet and a central angle of 1°26'54" and a long chord which bears North 38°22'58" West, 24.01 feet, said point being in the east right-of-way line of said Plano Parkway; THENCE along said east right-of-way line, and along said non-tangent curve to the right an arc distance of 24.01 feet to a point for corner, said point being the most southerly point of a corner- clip of the intersection of said east right-of-way line of Plano Parkway and the south right-of-way line of said State highway 121; THENCE North 08°46'31" East, along said corner-clip, a distance of 26.03 feet to a point for corner, said point being in the south right-of-way line of said State highway 121; THENCE North 60°47'38" East, along said south right-of-way line, a distance of 203.71 feet to a point for corner; THENCE North 58°17'36" East, continuing along said south right-of-way line, a distance of 252.11 feet to a point for corner; THENCE North 55°47'40" East, continuing along said south right-of-way line, a distance of 105.11 feet to a point for corner; THENCE North 58°17'42" East, continuing along said south right-of-way line, a distance of 248.62 feet to a point for corner; THENCE North 60°47'38" East, continuing along said south right-of-way line, a distance of 263.85 feet to a point for corner; THENCE North 76°30'51" East, continuing along said south right-of-way line, a distance of 92.27 feet to a point for corner; THENCE North 65°56'12" East, continuing along said south right-of-way line, a distance of 100.40 feet to a point for corner; THENCE North 64°13'39" East, continuing along said south right-of-way line, a distance of 100.18 feet to a point for corner; THENCE North 60°16'36" East, continuing along said south right-of-way line, a distance of 39.88 feet to a point for corner; THENCE South 74°12'01" East, continuing along said south right-of-way line, a distance of 70.70 feet to a point for corner; THENCE North 60°47'38" East, continuing along said south right-of-way line, a distance of 64.12 feet to a point for corner; THENCE North 15°47'17" East, continuing along said south right-of-way line, a distance of 73.27 feet to a point for corner; THENCE North 59°04'32" East, continuing along said south right-of-way line, a distance of 94.25 feet to a point for corner; THENCE North 55°39'04" East, continuing along said south right-of-way line, a distance of 100.40 feet to a point for corner; THENCE North 47°37'54" East, continuing along said south right-of-way line, a distance of 114.18 feet to a point for corner; THENCE North 60°47'38" East, continuing along said south right-of-way line, a distance of 3800.00 feet to a point for corner; THENCE North 65°20'10" East, continuing along said south right-of-way line, a distance of 189.41 feet to a point for corner; THENCE North 61°56'23" East, continuing along said south right-of-way line, a distance of 100.02 feet to a point for corner; THENCE North 63°39'23" East, continuing along said south right-of-way line, a distance of 100.12 feet to a point for corner; THENCE North 64°47'53" East, continuing along said south right-of-way line, a distance of 100.24 feet to a point for corner; THENCE North 66°30'16" East, continuing along said south right-of-way line, a distance of 201.00 feet to a point for corner; THENCE North 65°56'12" East, continuing along said south right-of-way line, a distance of 100.40 feet to a point for corner; THENCE North 66°30'16" East, continuing along said south right-of-way line, a distance of 100.50 feet to a point for corner; THENCE North 63°05'04" East, continuing along said south right-of-way line, a distance of 100.08 feet to a point for corner; THENCE North 64°13'39" East, continuing along said south right-of-way line, a distance of 100.18 feet to a point for corner; THENCE North 83°05'27" East, continuing along said south right-of-way line, a distance of 69.58 feet to a point for corner; THENCE North 60°39'18" East, continuing along said south right-of-way line, a distance of 33.81 feet to a point for corner, said point being in the west right-of-way line of Burlington Northern Railroad (having a variable width R.O.W.); THENCE North 60°38'52" East, leaving said west right-of-way line, a distance of 107.30 feet to a point for corner, said point being in the east right-of-way line of said Burlington Northern Railroad; THENCE North 60°45'58" East, leaving said east right-of-way line, continuing along said south right-of-way line of State Highway 121, a distance of 254.35 feet to a point for corner; THENCE North 63°19'02" East, continuing along said south right-of-way line, a distance of 585.96 feet to a point for corner; THENCE North 60°52'09" East, continuing along said south right-of-way line, a distance of 369.37 feet to a point for corner, said point being in the west right-of-way line of West Spring Creek Parkway (having a 160 ft R.O.W.); THENCE South 29°24'43" East, leaving said south right-of-way line, and along said west right- of-way line, a distance of 265.52 feet to a point for corner, for the beginning of a non-tangent curve to the right having a radius of 970.00 feet and a central angle of 29°13'42", and a long chord which bears South 14°53'13" East, 489.48 feet; THENCE continuing along said west right-of-way line, and along said non-tangent curve to the right an arc distance of 494.83 feet to a point for corner; THENCE South 00°22'42" East, continuing along said west right-of-way line, a distance of 476.17 feet to a point for corner; THENCE South 00°23'35" East, continuing along said west right-of-way line, a distance of 864.92 feet to a point for corner, said point being in the north line of Kings Ridge Addition, Phase Three, as recorded in Cabinet X, Page 450, Plat Records, Denton County, Texas; THENCE South 89°40'20" West, leaving said west right-of-way line, and along said north line, a distance of 1199.93 feet to a point for corner, said point being in the east right-of-way line of said Burlington Northern Railroad; THENCE North 87°39'44" West, leaving said north line, leaving said east right-of-way line, a distance of 101.16 feet to a point for corner, for the beginning of a non-tangent curve to the right having a radius of 3703.75 feet and a central angle of 3°44'19" and a long chord which bears South 04°12'25" West, 241.62 feet, said point being in the west right-of-way line of said Burlington Northern Railroad; THENCE along said east right-of-way line, and along said non-tangent curve to the right an arc distance of 241.67 feet to a point for corner; THENCE South 06°04'35" West, continuing along said east right-of-way line, a distance of 2524.64 feet to a point for corner; THENCE North 83°17'00" West, continuing along said east right-of-way line, a distance of 190.16 feet to a point for corner; THENCE South 00°51'51" East, continuing along said east right-of-way line, a distance of 970.10 feet to a point for corner; THENCE South 89°03'50" West, continuing along said east right-of-way line, a distance of 31.06 feet to a point for corner; THENCE South 01°14'37" East, continuing along said east right-of-way line, a distance of 447.78 feet to a point for corner; THENCE North 87°06'22" West, leaving said east right-of-way line, a distance of 1240.48 feet to a point for corner, for the beginning of a non-tangent curve to the left having a radius of 1130.00 feet and a central angle of 103°16'58", and a long chord which bears North 38°43'34" West, 1772.16 feet, said point being in the east right-of-way line of said Plano Parkway; THENCE along said east right-of-way line, and along said non-tangent curve to the left an arc distance of 2036.97 feet to a point for corner; THENCE South 89°38'05" West, continuing along said east right-of-way line, a distance of 647.23 feet to a point for corner, for the beginning of a non-tangent curve to the right having a radius of 950.00 feet and a central angle of 40°05'36" and a long chord which bears North 70°19'29" West, 651.29 feet; THENCE continuing along said east right-of-way line, and along said non-tangent curve to the right an arc distance of 664.77 feet to a point for corner, for the beginning of a reverse curve to the left having a radius of 1050.00 feet and a central angle of 40°15'06" and a long chord which bears North 70°25'01" West, 722.57 feet; THENCE continuing along said east right-of-way line, and along said curve to the left an arc distance of 737.65 feet to a point for corner; THENCE South 89°31'25" West, continuing along said east right-of-way line, a distance of 623.83 feet to a point for corner, for the beginning of a tangent curve to the right having a radius of 950.00 feet, a central angle of 0°48'07", and a long chord which bears South 89°55'28" West, 13.21 feet; THENCE continuing along said east right-of-way line, along said curve to the right, an arc distance of 13.21 feet to a point for corner; THENCE South 00°19'22" West, leaving said east right-of-way line, a distance of 100.00 feet to a point for corner, said point being in the west right-of-way line of said Plano Parkway; THENCE South 89°58'40" West, leaving said west right-of-way line, a distance of 1210.45 feet to a point for corner; THENCE North 00°25'18" West, a distance of 226.47 feet to the POINT OF BEGINNING and CONTAINING 19,128,279 square feet, 439.12 acres of land, more or less. Exhibit B [Special Assessment upon the Facility Property, Waterfront Property, and the Related Development Property] Exhibit C [Service and Assessment Plan]