Debt Service Funds Overview

Debt Service Funds Overview Irving issues longterm debt to finance major capital purchases; most often to improve or expand city facilities and infrastructure, but also for major capital equipment such as fire engines. The city has several financial policies regarding the use of debt located in the Budget Overview section. The city issues several different types of debt. Each type is issued for a specific purpose and is funded by one or more specific revenue streams over the term of the debt obligations. General Debt is backed by the full faith and credit of the City of Irving, meaning any revenue source can be used to pay the debt. In practice, principal and interest payments are funded by an assessment of tax on the valuation of each commercial, residential and business personal property account within the city. The city s general obligation debt is rated AAA/Aaa, the highest possible credit rating, by both Standard and Poor s and by Moody s Investor Services, two nationally recognized bond rating agencies. Article XI, Section 5 of the State of Texas Constitution states in part: no tax for any purpose shall ever be lawful for any one year, which shall exceed two and onehalf percent of the taxable property of the city. As a home rule city, the City of Irving is not limited by Texas State Law as to the amount of debt it may issue. The city charter limits the property tax rate to $1.50 per $100 valuation. The current tax rate is $.5986 per $100 valuation, which is unchanged from the prior year, so the charter tax rate limitation provides virtually no limit to debt issuance. Water and Sewer Revenue Debt is issued to finance capital improvements and expansion of the city s water and sewer utility. This debt is financed only from the revenues generated from water system customers and is not backed by the full faith and credit of the city. As a result, the bond ratings for Water and Sewer Revenue debt are lower at AA/Aa1, which translate into slightly higher interest cost for this debt. Municipal Drainage Utility (MDU) Debt is similar to Water and Sewer revenue debt. It is issued to fund the maintenance of the city s storm water drainage system and is funded by a monthly drainage fee on each parcel of land in the city. MDU debt is rated Aa2. Hotel Occupancy Tax (HOT) Debt was issued to finance the land purchase, design and construction of the Irving Convention Center. The primary revenue source to service this debt is 7% of the city s 9% Hotel Occupancy Tax, but General tax revenues are also pledged to finance the debt service in the event that HOT revenues are insufficient to meet debt obligations in a given year. This debt also carries the highest rating of AAA/Aaa by rating agencies. FY 20132014 Annual Operating Budget 353

Entertainment Venue Debt was issued in 2011 to finance the cost of land acquisition and design of a proposed entertainment venue next to the convention center. This debt is funded by a 2% allocation of the city s 9% HOT revenue specifically dedicated to the development of an entertainment venue. The entertainment venue debt is rated as BBB+. Solid Waste System (SWS) Revenue Debt was issued in 2012 to finance the city s acquisition of land for redevelopment. This issue is considered part of general debt service, but has revenue from the Solid Waste Services system specifically pledged as a repayment funding source. Public Improvement District (PID) Debt was issued in 2013 to finance the development of public infrastructure for two residential developments in Irving. Tax and Revenue Certificates of Obligation were issued with AAA/Aaa ratings backed by the full faith and credit of the city. However, the debt for the two districts is selfsupporting, with debt service to be paid by incremental growth in property values of a Tax Increment Financing (TIF) district. Should the growth in property values be insufficient to pay the debt service in a given year, a special assessment on all property within the PID/TIF district will be established to fully fund debt service requirements. The Total Debt Obligations chart on the following page summarizes the FY 201314 principal and interest payments and the total amount of debt outstanding. The chart also projects the cost of proposed new debt issues over the next five years as well as the amount of debt that will be paid off during that time. It is projected that the city s total debt obligations will increase by approximately $26 million in the next five years, including the proposed new debt issues for the FY 201314 budget and proposed bond sales over the next four budget years. Debt Fund Overview FY 20132014 Annual Operating Budget 354

FY 201314 Budget Total Debt Obligations Debt Type General Debt Water & Sewer Revenue Debt MDU Revenue Debt Convention Center Debt Entertainment Venue Debt Sanitation Revenue Debt PID #1 Debt Bridges of Las Colinas PID #2 Debt Ranchview Total Funding Source Property Taxes (Full Faith and Credit) Water & Sewer System Revenue Drainage Utility Fee 7% HOT Revenue 2% Brimer HOT Revenue Sanitation Fees transferred to General Fund Special Property Assessment Special Property Assessment FY 201314 Payments Principal $ 15,295,000 $ 14,352,562 $ 180,000 $ 346,875 $ 703,125 $ 155,000 Interest $ 9,015,990 8,494,208 Total $ 24,310,990 $ 22,846,770 349,810 $ $ $ 31,032,562 $ $ 169,810 $ 6,315,635 $ 962,621 $ 1,351,732 $ 248,400 $ 86,263 $ 26,644,659 $ $ 6,662,510 $ 1,665,746 $ 1,506,732 $ 248,400 $ 86,263 $ 57,677,221 Net Debt Outstanding FY 201314 to FY 203839 Principal $ 223,545,000 $ 207,015,963 $ 4,535,000 $ 129,145,125 $ 25,531,800 $ 28,945,000 $ 8,750,000 $ 3,210,000 $ 630,677,888 Interest $ 77,463,840 $ 73,713,030 $ 1,970,772 $ 127,267,625 $ 9,062,085 $ 16,189,125 $ 3,443,925 $ 1,136,935 $ 310,247,337 Total $ 301,008,840 $ 280,728,993 $ 6,505,772 $ 256,412,750 $ 34,593,885 $ 45,134,125 $ 12,193,925 $ 4,346,935 $ 940,925,225 5 Year CIP Projection of New Debt $ 114,251,808 $ 115,673,493 $ $ $ 151,086,747 $ $ $ $ 381,012,048 Total Estimated Debt Service $ 415,260,648 $ 396,402,486 $ 6,505,772 $ 256,412,750 $ 185,680,632 $ 45,134,125 $ 12,193,925 $ 4,346,935 $ 1,321,937,273 Debt Retired FY 1418 $ 125,275,143 $ 128,517,281 $ 1,745,631 $ 34,796,892 $ 51,900,629 $ 10,448,605 $ 1,548,000 $ 737,312 $ 354,969,493 Estimated Net Debt Outstanding in FY 1718 $ 289,985,505 $ 267,885,205 $ 4,760,141 $ 221,615,858 $ 133,780,003 $ 34,685,520 $ 10,645,925 $ 3,609,623 $ 966,967,780 Debt Fund Overview FY 20132014 Annual Operating Budget 355

General Debt Service Summary General debt can be in the form of general obligation (GO) bonds, certificates of obligation or tax notes. GO bonds must be approved by vote of the residents prior to issuance. In the most recent election (November 2006) residents voted to authorize $335 million in GO bonds. This bond election was divided into eleven separate propositions, and was recommended by a residents bond taskforce that met throughout the spring and summer of 2006 to assess the infrastructure needs of Irving for the next ten years. The General Interest and Sinking Fund is maintained to pay the debt service on General Obligation Bonds and Certificates of Obligation. A portion of the ad valorem tax rate is designated to pay debt service and is deposited into this fund for that purpose. An amount equal to the current year debt service is assessed each year. The City of Irving currently has $223,545,000 of general obligation bonds outstanding and has authorization to issue additional bonds in the amount of $325,000,000 for various purposes. This total includes the $335 million from the 2006 bond election as well as residual amounts remaining to be issued from the 1999 bond election. The authorized unissued amount includes the $16.2 million issuance planned for FY 201314. Additional information about individual projects planned for FY 201314 can be found in the CIP section of the budget Authorized General Obligation Bonds Debt Fund Overview Amount Amount Date Amount Previously Being Unissued Purpose Authorized Authorized Issued Issued 2014 Balance Streets 2/6/1999 $ 133,880,000 $ 96,330,000 $ 30,000 $ 37,520,000 Drainage Imprs 2/6/1999 25,000,000 15,750,000 3,500,000 5,750,000 Parks 2/6/1999 36,800,000 31,500,000 300,000 5,000,000 City Buildings 2/6/1999 8,500,000 6,220,000 2,280,000 Landfill 2/6/1999 9,055,000 200,000 8,855,000 Fire Services 2/6/1999 18,105,000 9,320,000 8,785,000 Police Services 2/6/1999 8,650,000 8,150,000 500,000 Youth Dev/Comm Ctr 2/6/1999 2,495,000 1,995,000 500,000 Streets 11/7/2006 117,825,000 10,245,000 6,170,000 101,410,000 Drainage Imprs 11/7/2006 32,600,000 500,000 32,100,000 Parks 11/7/2006 56,475,000 14,635,000 1,500,000 40,340,000 Library 11/7/2006 18,200,000 18,200,000 City Buildings 11/7/2006 15,600,000 6,155,000 250,000 9,195,000 Public Safety 11/7/2006 15,305,000 2,990,000 12,315,000 Voice & Data Systems 11/7/2006 25,000,000 14,500,000 2,500,000 8,000,000 Gateway Impovement 11/7/2006 35,000,000 6,800,000 1,950,000 26,250,000 Senior Citizens Center 11/7/2006 10,000,000 10,000,000 Totals: $ 568,490,000 $ 243,490,000 $ 16,200,000 $ 308,800,000 FY 20132014 Annual Operating Budget 356

Other general debt instruments can include certificates of obligation and tax notes. Certificates of obligation do not require voter approval, are generally short term in nature, and are frequently used to fund capital improvements not anticipated at the time of the latest bond election. There are currently $4,000,000 of certificates of obligation outstanding. Tax notes are similar to certificates of obligation in that there is no requirement for voter approval and they are generally short term in nature. The City of Irving currently has no tax notes outstanding. Distribution of FY 201314 Ad Valorem Collections % of Total Rate per $100 Collections General Fund 74.37% 0.4452 $79,061,674 Interest & Sinking Fund 25.63% 0.1534 $27,241,826 Total 100.00% 0.5986 $106,303,500 Distribution of Property Tax Rate FY 200304 to 201314 Debt Fund Overview 0.7000 0.6000 0.5000 0.4000.5328 0.1431.5479.5479.5479.5406.5406.5406 0.1436 0.1450 0.1275 0.1334 0.1334 0.1593.5761.5986.5986.5986 0.1609 0.1571 0.1524 0.1534 0.3000 0.2000 0.3897 0.4043 0.4029 0.4204 0.4072 0.4072 0.3813 0.4152 0.4415 0.4462 0.4452 0.1000 200304 200405 200506 200607 200708 200809 200910 201011 201112 201213 201314 Operations Debt Service The graph above illustrates that the proportion of ad valorem tax allocated to debt service has remained fairly constant over the past 10 years. Changes in the tax rate approved by City Council have been made in response to changes in the tax base and funding requirements of the General Fund. The city s Debt Capacity Model is a financial tool used to assess the city s financial ability to incur additional debt. Capital infrastructure expansion and replacement requirements are carefully balanced against current and future revenue and expenditure patterns to determine the optimal level of debt issuance for any given year, as well as determining total debt levels in future years. The model is updated on a semiannual basis during budget preparation and also at the time of bond issuance. Certain ratios are tested with the model including the ratio of general debt service expenditures to General Fund expenditures plus debt service. This target for this ratio is to remain below 15%. For FY 201314, the ratio is 13.43%. FY 20132014 Annual Operating Budget 357

Analysis of Benchmark Cities General Bonded Indebtedness for 2013 City Population Total Net Taxable Value Debt as a % of AV Ratio Rank Bonded Debt Per Capita Rank Arlington 380,084 17,677,891,333 5.89% 1 2,742 2 Richardson 101,742 9,958,811,893 2.85% 2 2,787 1 Garland 228,060 10,083,675,500 2.58% 3 1,143 8 Mesquite 139,950 5,597,965,285 2.13% 4 850 11 Dallas 1,316,350 83,680,000,000 2.05% 5 1,301 3 Grand Prairie 176,980 9,373,823,177 1.93% 6 1,022 7 Ft. Worth 758,738 43,278,704,506 1.81% 7 1,032 6 Carrollton 129,209 9,159,989,052 1.73% 8 1,229 5 Denton 122,830 6,716,711,368 1.72% 9 943 9 Plano 269,776 25,647,504,913 1.36% 10 1,294 4 Irving 220,750 17,312,693,245 1.17% 11 917 10 Average 349,497 21,680,706,388 2.29% $1,387 Source: 2013 Annual TML Taxation and Debt Survey and city adopted budgets Ten other municipalities in the Dallas/Fort Worth Metroplex are used for benchmark comparisons of the city s outstanding general debt when compared to the city s population and total assessed value of all property within the city. Irving ranks lowest out of the 11 cities in debt to assessed valuation and tenth lowest when debt is compared to population. The difference in Irving s ranking between the two ratios is the large amount of commercial property in the city. Approximately 45% of the city s assessed value is compromised of commercial real estate with an additional 27% derived from business personal property. Only 28% of the tax base is residential property, a lower percentage than both Dallas and Fort Worth, and much less the suburban communities surrounding each city. Debt Fund Overview FY 20132014 Annual Operating Budget 358

FY 201314 Adopted Entertainment General Hotel Occupancy Water and Sewer Venue Solid Waste Services Solid Waste Services Debt Service Debt Service Debt Service Debt Service Debt Service Reserve Fund Fund Fund Fund Fund Fund Beginning Fund Balance 1001 $ 9,671,354 $ $ 2,755,010 $ 1,283,071 $ 7,518 $ 2,246,523 Property Taxes $ 27,533,753 $ $ $ $ $ Sales Taxes $ $ $ $ $ $ Hotel/Motel Taxes $ $ $ $ $ $ Grant Receipts $ $ $ $ $ $ Tax Note Proceeds $ $ $ $ $ $ Bond Proceeds $ $ $ $ $ $ Franchise Fees $ $ $ $ $ $ Fees, Fines, and Permits $ $ $ $ $ $ Charges for Services $ $ $ $ $ $ Interest $ 24,178 $ $ 2,500 $ 100 $ $ 5,000 Rent $ $ $ $ $ $ Miscellaneous $ $ $ $ $ $ Lien Retirement $ $ $ $ $ $ Unrealized Gain $ $ $ $ $ $ Contributions $ $ $ $ $ $ Revenues $ 27,557,931 $ $ 2,500 $ 100 $ $ 5,000 Transfers In $ 445,206 $ 5,357,491 $ 23,202,799 $ 1,353,000 $ 1,507,232 $ 228,004 Total Revenues $ 28,003,137 $ 5,357,491 $ 23,205,299 $ 1,353,100 $ 1,507,232 $ 233,004 Funds Available $ 37,674,491 $ 5,357,491 $ 25,960,309 $ 2,636,171 $ 1,514,750 $ 2,479,527 Police $ $ $ $ $ $ Fire $ $ $ $ $ $ Community and Economic Development $ $ $ $ $ $ Administrative & Other $ $ $ $ $ $ Non Departmental $ $ $ $ $ $ Water and Sewer $ $ $ $ $ $ Streets/Engineering/Traffic $ $ $ $ $ $ Library $ $ $ $ $ $ Parks and Recreation $ $ $ $ $ $ Environmental and Public Health $ $ $ $ $ $ Municipal Court $ $ $ $ $ $ Debt Service $ 28,353,137 $ 5,044,745 $ 22,851,770 $ 1,670,246 $ 1,507,232 $ Arts $ $ $ $ $ $ Expenditures $ 28,353,137 $ 5,044,745 $ 22,851,770 $ 1,670,246 $ 1,507,232 $ Transfers Out $ $ $ $ $ $ Total Expenditures $ 28,353,137 $ 5,044,745 $ 22,851,770 $ 1,670,246 $ 1,507,232 $ Ending Fund Balance 0930 $ 9,321,354 $ 312,746 $ 3,108,539 $ 965,925 $ 7,518 $ 2,479,527 FY 20132014 Annual Operating Budget 359

FY 201314 Adopted PID#1/TIF#3 PID#2/TIF#4 Bridges of Las Colinas Ranchview Municipal Debt Service Debt Service Drainage Utility Debt Service Fund Fund Debt Fund Funds Beginning Fund Balance 1001 Property Taxes Sales Taxes Hotel/Motel Taxes Grant Receipts Tax Note Proceeds Bond Proceeds Franchise Fees Fees, Fines, and Permits Charges for Services Interest Rent Miscellaneous Lien Retirement Unrealized Gain Contributions Revenues Transfers In Total Revenues Funds Available Police Fire Community and Economic Development Administrative & Other Non Departmental Water and Sewer Streets/Engineering/Traffic Library Parks and Recreation Environmental and Public Health Municipal Court Debt Service Arts Expenditures Transfers Out Total Expenditures Ending Fund Balance 0930 $ 300,840 $ 104,474 $ 290,251 $ 16,659,041 $ $ $ $ 27,533,753 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 31,778 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 27,565,531 $ $ $ 349,810 $ 32,443,542 $ $ $ 349,810 $ 60,009,073 $ 300,840 $ 104,474 $ 640,061 $ 76,668,114 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 248,575 $ 86,438 $ 349,810 $ 60,111,953 $ $ $ $ $ 248,575 $ 86,438 $ 349,810 $ 60,111,953 $ $ $ $ $ 248,575 $ 86,438 $ 349,810 $ 60,111,953 $ 52,265 $ 18,036 $ 290,251 $ 16,556,161 FY 20132014 Annual Operating Budget 360

General Debt Service Fund 2011 12 2012 13 2012 13 2013 14 ACTUAL BUDGET ESTIMATED ADOPTED Available Fund Balance 10 01 $ 7,310,659 $ 7,656,238 $ 9,646,329 $ 9,671,354 Revenues Ad Valorem Taxes $ 25,818,390 $ 26,105,784 $ 25,975,487 $ 27,233,753 Penalties and Interest 110,277 150,000 50,248 150,000 Delinquent Taxes 80,423 150,000 86,871 150,000 Transfer from Solid Waste Services 896,452 824,913 824,913 445,206 Misc. Revenue 2,292 Interest on Investments 17,098 38,281 5,348 24,178 Total Revenue $ 26,924,933 $ 27,268,978 $ 26,942,867 $ 28,003,137 Total Funds Available $ 34,235,592 $ 34,925,216 $ 36,589,195 $ 37,674,491 Expenditures: Principal Bonds $ 12,775,000 $ 14,010,000 $ 14,010,000 $ 15,295,000 Interest Bonds 9,420,717 9,108,820 9,108,820 9,015,990 Other Contract Payment 2,322,558 2,200,000 2,288,927 2,250,000 Other 67,088 1,509,294 1,509,294 1,792,147 Agent Fees Bonds 3,900 10,000 800 Total Expenditures $ 24,589,263 $ 26,838,114 $ 26,917,841 $ 28,353,137 Available Fund Balance 9 30 $ 9,646,329 $ 8,087,102 $ 9,671,354 $ 9,321,354 Fund Description: The General Interest and Sinking Fund is maintained to pay the debt service on General Obligation Bonds and Certificates of Obligation. A portion of the ad valorem tax rate is designated to pay debt service and is deposited into this fund for that purpose. An amount equal to the current year debt service is assessed each year. The fund balances have accumulated over the years from interest earned on the tax revenue prior to payment of debt service and from tax collections exceeding the budgeted 98% level. Standard & Poor's and Moody's have indicated that the reserve in this fund, which can be used for no purpose other than debt service, was a major factor in assigning the AAA and Aaa, ratings respectively, to the city's General Obligation Bonds. FY 20132014 Annual Operating Budget 361

Schedule of Requirements for FY 2013 14 G e n e r a l O b l i g a t i o n B o n d s Series Name of Bond Principal Interest Total 2004 General Obligation Refunding and Improvement $ 1,605,000 $ 303,356 $ 1,908,356 2005 General Obligation 750,000 372,938 1,122,938 2005A General Obligation Refunding and Improvement 3,260,000 1,326,683 4,586,683 2007 General Obligation 1,375,000 885,156 2,260,156 2008 General Obligation 1,640,000 1,078,866 2,718,866 2008 Certificates of Obligation 200,000 134,100 334,100 2009 General Obligation 3,410,000 1,174,075 4,584,075 2010 General Obligation Refunding and Improvement 900,000 586,025 1,486,025 2011 General Obligation Refunding and Improvement 250,000 1,659,529 1,909,529 2012 General Obligation Refunding and Improvement 1,010,000 485,563 1,495,563 2013 General Obligation 895,000 641,700 1,536,700 2014 Proposed Certificates of Obligation 198,000 198,000 2014 Proposed General Obligation 170,000 170,000 Total Prinicpal and Interest $ 15,295,000 $ 9,015,990 $ 24,310,990 Other Obligations Olympus Developer Participation $ 2,250,000 $ $ 2,250,000 2011 Refunding Savings Allocated to Convention Center 1,792,147 1,792,147 Total Debt Service Requirements $ 17,545,000 $ 10,808,137 $ 28,353,137 This schedule represents the 2013 14 debt service payments due on each outstanding general obligation bond issue plus estimated interest on the projected 2014 GO bond and 2014 Certificates of Obligation issues. Developer participation is the estimated payment due from debt service for capital improvements made as part of the Olympus development. In FY 2010 11, GO Bonds were issued to refund several outstanding issues to reduce interest costs. At the time, the savings from this refunding were dedicated to create a reserve to provide excess debt service funding for the Convention Center bonds as needed in future years. FY 20132014 Annual Operating Budget 362

Schedule of General Obligation Bonded Indebtedness to Maturity Projected Debt Olympus Convention Projected Year Principal Interest Total FY 2014 17 Obligation Center Total 2013 14 $ 15,295,000 $ 8,647,990 $ 23,942,990 $ 368,000 $ 2,250,000 $ 1,792,147 $ 28,353,137 2014 15 14,890,000 8,032,596 22,922,596 3,583,333 1,815,514 1,663,666 29,985,109 2015 16 14,215,000 7,442,890 21,657,890 2,947,400 1,680,231 26,285,521 2016 17 13,225,000 6,839,614 20,064,614 4,696,200 1,675,554 26,436,368 2017 18 12,180,000 6,345,170 18,525,170 6,566,950 1,893,718 26,985,838 2018 19 11,190,000 5,885,514 17,075,514 8,248,825 2,041,162 27,365,501 2019 20 19,695,000 5,375,108 25,070,108 3,416,075 2,081,276 30,567,459 2020 21 18,590,000 4,593,089 23,183,089 3,195,675 2,300,299 28,679,063 2021 22 17,440,000 3,779,214 21,219,214 6,382,675 2,655,195 30,257,084 2022 23 17,800,000 3,032,083 20,832,083 7,023,000 2,879,104 30,734,187 2023 24 9,700,000 2,260,030 11,960,030 6,799,425 3,112,178 21,871,633 2024 25 9,285,000 1,870,916 11,155,916 6,575,850 3,357,910 21,089,675 2025 26 8,545,000 1,481,582 10,026,582 6,352,275 3,559,544 19,938,401 2026 27 7,275,000 1,141,935 8,416,935 6,128,700 3,818,074 18,363,709 2027 28 5,920,000 824,623 6,744,623 5,905,125 3,994,495 16,644,242 2028 29 5,935,000 573,888 6,508,888 5,681,550 4,126,550 16,316,987 2029 30 3,230,000 321,981 3,551,981 5,452,975 4,261,521 13,266,477 2030 31 2,355,000 192,025 2,547,025 5,219,700 4,395,988 12,162,713 2031 32 1,880,000 105,350 1,985,350 4,996,900 4,538,658 11,520,908 2032 33 890,000 40,050 930,050 4,774,100 4,687,726 10,391,876 2033 34 4,551,300 4,831,395 9,382,695 2034 35 2,728,500 4,988,349 7,716,849 $ 223,545,000 $ 77,463,840 $ 301,008,840 $ 111,594,533 $ 6,354,442 $ 71,844,032 $ 490,801,847 Millions General Obligation Bonded Indebtedness to Maturity with Projected Bond Sales 2014 2017 $35 $30 $25 $20 $15 $10 $5 $ 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Principal Interest New Debt Olympus Convention Center FY 20132014 Annual Operating Budget 363

Water and Sewer Debt Service Fund 2011 12 2012 13 2012 13 2013 14 ACTUAL BUDGET ESTIMATED ADOPTED Available Fund Balance 10 01 $ 2,243,190 $ 3,242,541 $ 2,758,410 $ 2,755,010 Revenues Transfer from Water & Sewer $ 21,725,758 $ 21,828,763 $ 21,828,763 $ 23,202,799 Interest on Investments 2,721 5,000 1,600 2,500 Total Revenues $ 21,728,479 $ 21,833,763 $ 21,830,363 $ 23,205,299 Total Funds Available $ 23,971,669 $ 25,076,304 $ 24,588,773 $ 25,960,309 Expenditures Principal Bonds $ 11,470,000 $ 12,740,000 $ 12,740,000 $ 14,040,000 Interest Bonds 8,715,840 8,194,859 8,194,859 7,912,866 Agent Fees Bonds 2,900 5,000 5,000 5,000 Transfer to Other Funds 130,614 Principal Lake Chapman 293,177 302,714 302,714 312,562 Interest Lake Chapman 600,727 591,190 591,190 581,342 Total Expenditures $ 21,213,258 $ 21,833,763 $ 21,833,763 $ 22,851,770 Available Fund Balance 09 30 $ 2,758,410 $ 3,242,541 $ 2,755,010 $ 3,108,539 Fund Description: Water and Sewer Revenue Bonds are secured by the revenues of the water and sewer utility system. The City of Irving provides water and sewer services to its residents and businesses and sets rates for these services at a level to provide funds for daily operations of the system, routine capital improvements, and payments of debt service requirements. The System currently has $207,015,7615 in outstanding principal and does not plan to issue additional debt in FY 2013 14. #REF! The Water and Sewer Debt Service Fund is maintained to pay the debt service on Water and Sewer Revenue Bonds. An amount equal to the annual debt service requirement is transferred to this fund from the Water and Sewer System Fund each year. The bond covenants require monthly deposits to the Debt Service Fund of not less than one sixth of the next semi annual interest payment and one twelfth of the next annual principal payment. The money in this fund can only be used to pay debt service on outstanding Waterand SewerRevenue Bonds. FY 20132014 Annual Operating Budget 364

Schedule of Requirements for FY 2013 14 W A T E R A N D S E W E R Series Name of Bond Principal Interest Total 2004 WW/SS New Lien Revenue Refunding and Improvement $ 2,015,000 $ 124,363 $ 2,139,363 2005 WW/SS New Lien Revenue Improvement 330,000 220,643 550,643 2006 WW/SS New Lien Revenue 2,435,000 1,145,425 3,580,425 2007 WW/SS New Lien Revenue Refunding and Improvement 680,000 591,444 1,271,444 2008 WW/S New Lien Revenue Bonds 519,336 519,336 2009 WW/S New Lien Revenue Refunding and Improvement 835,000 764,544 1,599,544 2011 WW/S New Lien Revenue Refunding and Improvement 4,965,000 2,908,975 7,873,975 2012 WW/S New Lien Revenue Bonds 2,180,000 973,613 3,153,613 2013 WW/S New Lien Revenue Bonds 600,000 664,525 1,264,525 Total Revenue Bond Debt $ 14,040,000 $ 7,912,866 $ 21,952,866 Corps of Engineer's Payments $ 312,562 $ 581,342 $ 893,904 Total Debt Service $ 14,352,562 $ 8,494,208 $ 22,846,770 This schedule represents the 2013 14 debt service payments due on each outstanding water and sewer revenue bond issues. The 2009 New Lien Revenue Refunding and Improvement Bonds refunded the last of the bonds sold under the original lien bond covenants. For 2010 11 forward, Water and Sewer debt service is consolidated into one interst and sinking fund. FY 20132014 Annual Operating Budget 365

Schedule of Water and Sewer Revenue Bonded Indebtedness to Maturity FY 2014 17 Year Principal Interest Total Projected New Debt 2013 14 $ 14,352,562 $ 8,494,208 $ 22,846,770 $ 2014 15 14,942,729 7,908,135 22,850,864 61,277 2015 16 15,093,228 7,365,673 22,458,901 3,609,141 2016 17 15,284,068 6,809,621 22,093,688 6,398,991 2017 18 15,465,260 6,169,766 21,635,026 6,348,623 2018 19 15,041,817 5,499,710 20,541,526 6,294,005 2019 20 14,523,749 4,828,247 19,351,996 6,237,008 2020 21 13,626,070 4,200,125 17,826,195 6,172,323 2021 22 11,918,791 3,607,886 15,526,677 6,109,335 2022 23 10,446,927 3,114,486 13,561,413 6,037,430 2023 24 9,550,489 2,702,218 12,252,708 5,961,300 2024 25 8,379,493 2,320,538 10,700,031 5,885,330 2025 26 8,163,953 1,954,358 10,118,310 5,803,905 2026 27 7,068,882 1,593,872 8,662,754 5,711,103 2027 28 6,134,298 1,282,606 7,416,904 5,616,615 2028 29 4,995,215 1,018,402 6,013,616 5,519,520 2029 30 4,166,649 804,505 4,971,154 5,413,895 2030 31 4,328,618 639,861 4,968,479 5,299,125 2031 32 2,496,140 459,039 2,955,179 5,179,595 2032 33 1,784,231 371,098 2,155,329 5,054,075 $ 207,015,961 $ 73,713,030 $ 280,728,991 $ 115,673,493 Millions Revenue Bonded Indebtedness to Maturity by Year $40 $35 $30 $25 $20 $15 $10 $5 $ Principal Interest Projected FY 20132014 Annual Operating Budget 366

Hotel Occupancy Tax Debt Service Fund 2011 12 2012 13 2012 13 2013 14 ACTUAL BUDGET ESTIMATED ADOPTED Available Fund Balance 10 01 $ 11,895 $ 197,236 $ $ Revenues Transfer 5% Hotel/Motel Tax Allocation $ 1,269 $ $ $ Transfer from 1% Preservation Fund 600,000 Transfer from Convention Ctr 2% 4,574,663 4,674,754 4,574,754 5,044,745 Transfer from Entertainment Venue 2% 356,042 357,628 357,628 312,746 Interest on Investments 175 500 Total Revenues $ 5,532,148 $ 5,032,882 $ 4,932,382 $ 5,357,491 Total Funds Available $ 5,544,043 $ 5,230,118 $ 4,932,382 $ 5,357,491 Expenditures Principal Bonds $ 510,000 $ 310,800 $ 310,800 $ 346,875 Interest Bonds 6,562,153 6,409,091 6,409,091 6,315,635 Agent Fees Bonds 398 5,775 6,000 Total Expenditures $ 7,072,550 $ 6,719,891 $ 6,725,666 $ 6,668,510 Internal Loan from General I&S 1,528,507 1,509,294 1,793,284 1,623,765 Available Fund Balance 09 30 $ $ (1,489,773) $ $ 312,746 Fund Description: Hotel Occupancy Tax Revenue Bonds are secured by a 7% Hotel Occupancy tax assessed on sleeping rooms within the city. Bonds were issued in 2001 to purchase land in the Las Colinas Urban Center for a Convention Center. Two percent of the 7% Hotel Occupancy Tax is dedicated to the construction and operation of the Convention Center. A poriton of this revenue is transfered to this fund to pay debt service costs. Additional bonds were issued in 2009 to fund the construction of the Convention Center. As stated in the Convention Center bond covenants, debt service funds are deposited with an escrow agent from HOT revenues on year prior to payment of the debt service. FY 20132014 Annual Operating Budget 367

Hotel Occupancy Tax Revenue Bonds Debt Service Summary C O N V E N T I O N C E N T E R Series Name of Bond Principal Interest Total 2013 Combination Tax and HOT Revenue CO's $ 346,875 $ 43,179 $ 390,054 2009 Combination Tax and HOT Revenue CO's 6,272,456 6,272,456 $ 346,875 $ 6,315,635 $ 6,662,510 This schedule represents 55.5% allocation of debt service on the 2013 CO's which refunded the issue used to purchase land for the Convention Center and the 2009 CO's issued for development and construction of the Convention Center. Both issues are combination certificates of obligation, they are secured by the full faith and creditof the City of Irvingby a pledge of ad valoremtax as well as from Hotel Occupancy Tax revenues. FY 20132014 Annual Operating Budget 368

Schedule of Hotel Occupancy Tax Year Principal Interest Total 2013 14 $ 346,875 $ 6,315,635 $ 6,662,510 2014 15 349,650 6,312,167 6,661,817 2015 16 505,200 6,308,504 6,813,704 2016 17 892,975 6,299,118 7,192,093 2017 18 1,193,525 6,273,243 7,466,768 2018 19 1,436,850 6,234,590 7,671,440 2019 20 1,577,400 6,189,477 7,766,877 2020 21 1,910,725 6,133,929 8,044,654 2021 22 2,450,000 6,064,250 8,514,250 2022 23 2,855,000 5,941,750 8,796,750 2023 24 3,290,000 5,799,000 9,089,000 2024 25 3,760,000 5,634,500 9,394,500 2025 26 4,210,000 5,446,500 9,656,500 2026 27 4,740,000 5,236,000 9,976,000 2027 28 5,215,000 4,999,000 10,214,000 2028 29 5,670,000 4,738,250 10,408,250 2029 30 6,155,000 4,451,038 10,606,038 2030 31 6,665,000 4,138,950 10,803,950 2031 32 7,210,000 3,800,700 11,010,700 2032 33 7,790,000 3,434,488 11,224,488 2033 34 8,395,000 3,038,525 11,433,525 2034 35 9,045,000 2,611,500 11,656,500 2035 36 9,720,000 2,159,250 11,879,250 2036 37 10,430,000 1,673,250 12,103,250 2037 38 11,185,000 1,151,750 12,336,750 2038 39 11,850,000 592,500 12,442,500 $ 129,145,125 $ 127,267,625 $ 256,412,750 Hotel Occupancy Tax Bonded Indebtedness to Maturity Millions $20 $18 $16 $14 $12 $10 $8 $6 $4 $2 $ 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038 Principal Interest FY 20132014 Annual Operating Budget 369

Entertainment Venue Debt Service Fund 2011 12 2012 13 2012 13 2013 14 ACTUAL BUDGET ESTIMATED ADOPTED Available Fund Balance 10 01 $ 1,099,487 $ 1,095,187 $ 1,525,506 $ 1,283,071 Revenues Transfer from HOT Tax Revenues $ 1,383,120 $ 1,301,102 $ 1,301,102 $ 1,353,000 Transfers In 4,500 Interest Income 86 250 140 100 Total Revenues $ 1,387,707 $ 1,301,352 $ 1,301,242 $ 1,353,100 Total Funds Available $ 2,487,194 $ 2,396,539 $ 2,826,748 $ 2,636,171 Expenditures Principal Bonds $ $ 360,000 $ 598,075 $ 703,125 Interest Bonds 957,187 941,102 941,102 962,621 Agent Fees Bonds 4,500 4,500 4,500 4,500 Total Expenditures $ 961,687 $ 1,305,602 $ 1,543,677 $ 1,670,246 Available Fund Balance 09 30 $ 1,525,506 $ 1,090,937 $ 1,283,071 $ 965,925 Fund Description: This fund represents the debt service on the Entertainment Venue Private Placement Bonds. These bonds were issued to fund the engineering and design phase of the Entertainment Venue Project. The bonds are paid by the 2% Brimer Tax and are secured by the remaining 7% HotelOccupancy Tax revenues collected by the city. FY 20132014 Annual Operating Budget 370

Schedule of Requirements Entertainment Venue Debt Obligations Series Name of Bond Principal Interest Total 2013 HOT Certificates of Obligation $ 278,125 $ 34,621 $ 312,746 2011 HOT Revenue Refunding Bonds (Taxable) 425,000 928,000 1,353,000 $ 703,125 $ 962,621 $ 1,665,746 This schedule represents the debt service on the 2011 Entertainment Venue Private Placement Bond issues, as well as the 44.5% allocation of the 2013 CO that refinanced the issue that purchased the land for the Entertainment Venue. Private placement bonds were issued to fund the engineering and design phase of the Entertainment Venue Project. Although bond issue has a variable interest rate, interest for budget purposes is based on a 4% interest rate. The bonds are secured by the 9% Hotel Tax collectedbythe city. Theses bonds are scheduled to be refinanced in FY 2013 14 as part of the Entertainment Venue development. The budgetwill be adjusted once final terms and interest rates are known. FY 20132014 Annual Operating Budget 371

Schedule of Entertainment Venue Bonded Indebtedness to Maturity * Variable rate estimated at 4% Year Principal Interest* Total 2013 14 $ 703,125 $ 962,621 $ 1,665,746 2014 15 1,415,350 942,840 2,358,190 2015 16 1,469,800 895,695 2,365,495 2016 17 1,517,025 843,261 2,360,286 2017 18 1,571,475 791,600 2,363,075 2018 19 1,628,150 736,028 2,364,178 2019 20 1,687,600 678,526 2,366,126 2020 21 1,749,275 615,320 2,364,595 2021 22 1,495,000 551,600 2,046,600 2022 23 1,555,000 491,800 2,046,800 2023 24 1,620,000 430,192 2,050,192 2024 25 1,685,000 364,298 2,049,298 2025 26 1,750,000 297,400 2,047,400 2026 27 1,820,000 227,400 2,047,400 2027 28 1,895,000 154,813 2,049,813 2028 29 1,970,000 78,691 2,048,691 2029 30 2030 31 2031 32 $ 25,531,800 $ 9,062,085 $ 34,593,885 Brimer HOT Tax Bonded Indebtedness to Maturity Millions $10 $8 $6 $4 $2 $0 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 Principal Interest* FY 20132014 Annual Operating Budget 372

Municipal Drainage Utility Debt Service Fund 2011 12 2012 13 2012 13 2013 14 ACTUAL BUDGET ESTIMATED ADOPTED Available Fund Balance 10 01 $ 232,251 $ 323,751 $ 290,251 $ 290,251 Revenues Transfer from MDU Fund $ 210,399 $ 213,799 $ 213,799 $ 349,810 Interest Income 200 Total Revenues $ 210,399 $ 213,999 $ 213,799 $ 349,810 Total Funds Available $ 442,650 $ 537,750 $ 504,050 $ 640,061 Expenditures Other $ 500 $ $ $ Principal Bonds 80,000 85,000 85,000 180,000 Interest Bonds 71,899 128,799 128,799 169,810 Total Expenditures $ 152,399 $ 213,799 $ 213,799 $ 349,810 Available Fund Balance 09 30 $ 290,251 $ 323,951 $ 290,251 $ 290,251 Fund Description: This fund represents the debt service for Municipal Drainage Utility Revenue Bonds. These bonds will finance major drainage projects within thecity'sdrainage systemand will reduce the likelihood offloodingduringmajor rain events. FY 20132014 Annual Operating Budget 373

Schedule of Requirements Municipal Drainage Utility Revenue Bonds Series Name of Bond Principal Interest Total 2010 MDU Revenue Bonds $ 85,000 $ 68,599 $ 153,599 2013 MDU Revenue Bonds 95,000 101,211 196,211 $ 180,000 $ 169,810 $ 349,810 This schedule represents the 2013 14 debt service payments due on each outstanding Municipal Drainage Utility revenue bond issued during the current fiscal year. FY 20132014 Annual Operating Budget 374

Schedule of Municipal Drainage Utility Bonded Indebtedness to Maturity Year Principal Interest Total 2013 14 $ 180,000 $ 169,810 $ 349,810 2014 15 185,000 162,162 347,162 2015 16 195,000 158,037 353,037 2016 17 195,000 153,237 348,237 2017 18 200,000 147,387 347,387 2018 19 205,000 141,268 346,268 2019 20 210,000 134,762 344,762 2020 21 220,000 127,962 347,962 2021 22 230,000 120,706 350,706 2022 23 235,000 111,781 346,781 2023 24 245,000 102,546 347,546 2024 25 255,000 92,746 347,746 2025 26 265,000 82,546 347,546 2026 27 275,000 71,821 346,821 2027 28 285,000 60,658 345,658 2028 29 300,000 49,056 349,056 2029 30 310,000 36,620 346,620 2030 31 175,000 23,400 198,400 2031 32 180,000 15,963 195,963 2032 33 190,000 8,313 198,313 $ 4,535,000 $ 1,970,772 $ 6,505,772 Thousands MDU Revenue Bonded Indebtedness to Maturity $800 $600 $400 $200 $ 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 Principal Interest FY 20132014 Annual Operating Budget 375

Solid Waste Services Debt Service Fund 2011 12 2012 13 2012 13 2013 14 ACTUAL BUDGET ESTIMATED ADOPTED Available Fund Balance 10 01 $ $ 2,673 $ $ 7,518 Revenues Bond Proceeds $ 27,161,699 $ $ $ Transfer from Economic Development 256,857 1,516,755 1,516,755 1,507,232 Interest on Investments 875 Total Revenues $ 27,418,556 $ 1,517,630 $ 1,516,755 $ 1,507,232 Total Funds Available $ 27,418,556 $ 1,520,303 $ 1,516,755 $ 1,514,750 Expenditures Principal Bonds $ $ 150,000 $ 150,000 $ 155,000 Interest Bonds 256,857 1,358,737 1,358,737 1,351,732 Loan Commitment 27,000,000 Bond Issuance Costs 161,699 8,018 500 500 Agent Fees Bonds Total Expenditures $ 27,418,556 $ 1,516,755 $ 1,509,237 $ 1,507,232 Available Fund Balance 09 30 $ $ 3,548 $ 7,518 $ 7,518 Fund Description: The Solid Waste Services Interest and Sinking Fund was established in FY 2011 12 to pay the debt obligations of the Solid Waste Services Fund, including the refinancing of Heritage Crossing project debt which is secured by a pledge of sanitation revenues to the General Fund. FY 20132014 Annual Operating Budget 376

Schedule of Requirements Solid Waste Services Revenue Debt Obligations Series Name of Bond Principal Interest Total 2012 SWS Private Placement Special Revenue $ 155,000 $ 1,351,732 $ 1,506,732 $ 155,000 $ 1,351,732 $ 1,506,732 This schedule represents the 2013 14 debt service payments due on the outstanding Solid Waste Services revenue bonds for the upcoming fiscal year. FY 20132014 Annual Operating Budget 377

Schedule of Solid Waste Services Revenue Bonded Indebtedness to Maturity Year Principal Interest Total 2013 14 $ 155,000 $ 1,351,732 $ 1,506,732 2014 15 160,000 1,344,493 1,504,493 2015 16 1,140,000 1,340,621 2,480,621 2016 17 1,195,000 1,283,783 2,478,783 2017 18 1,250,000 1,227,977 2,477,977 2018 19 1,305,000 1,169,602 2,474,602 2019 20 1,370,000 1,111,695 2,481,695 2020 21 1,430,000 1,044,679 2,474,679 2021 22 1,500,000 977,898 2,477,898 2022 23 1,570,000 907,848 2,477,848 2023 24 1,645,000 836,815 2,481,815 2024 25 1,720,000 757,708 2,477,708 2025 26 1,800,000 677,384 2,477,384 2026 27 1,885,000 593,324 2,478,324 2027 28 1,970,000 506,678 2,476,678 2028 29 2,065,000 413,295 2,478,295 2029 30 2,160,000 316,860 2,476,860 2030 31 2,260,000 215,988 2,475,988 2031 32 2,365,000 110,748 2,475,748 2032 33 $ 28,945,000 $ 16,189,125 $ 45,134,125 SWS Revenue Bonded Indebtedness to Maturity Millions $10 $8 $6 $4 $2 $ 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 Principal Interest FY 20132014 Annual Operating Budget 378

PID #1/TIF #3 Bridges of Las Colinas Debt Service Fund 2011 12 2012 13 2012 13 2013 14 ACTUAL BUDGET ESTIMATED ADOPTED Available Fund Balance 10 01 $ $ $ $ 300,840 Revenues Bond Proceeds $ $ $ 393,990 $ Transfer from PID #1/TIF #3 Operating Fund Interest on Investments Total Revenues $ $ $ 393,990 $ Total Funds Available $ $ $ 393,990 $ 300,840 Expenditures Principal $ $ $ $ Interest 93,150 248,400 Agent Fees Bonds 175 Total Expenditures $ $ $ 93,150 $ 248,575 Available Fund Balance 09 30 $ $ $ 300,840 $ 52,265 Fund Description: This interest and sinking fund was created to track debt service payments related to the 2013A Certificates of Obligation issued to finance public improvements related to the Bridges of Las Colinas development. FY 20132014 Annual Operating Budget 379

Schedule of PID #1/TIF #3 Bonded Indebtedness to Maturity Year Principal Interest Total 2013 14 $ $ 248,400 $ 248,400 2014 15 248,400 248,400 2015 16 40,000 248,400 288,400 2016 17 120,000 247,600 367,600 2017 18 150,000 245,200 395,200 2018 19 200,000 242,200 442,200 2019 20 240,000 238,200 478,200 2020 21 570,000 232,800 802,800 2021 22 585,000 219,975 804,975 2022 23 595,000 205,350 800,350 2023 24 615,000 187,500 802,500 2024 25 635,000 169,050 804,050 2025 26 655,000 150,000 805,000 2026 27 670,000 130,350 800,350 2027 28 690,000 110,250 800,250 2028 29 715,000 89,550 804,550 2029 30 735,000 68,100 803,100 2030 31 755,000 46,050 801,050 2031 32 780,000 23,400 803,400 $ 8,750,000 $ 3,443,925 $ 12,193,925 Millions PID #1/TIF #3 Bridges of Las Colinas Bonded Indebtedness to Maturity $4 $3 $2 $1 $0 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 Principal Interest FY 20132014 Annual Operating Budget 380

PID #2/TIF #4 Debt Service Fund 2011 12 2012 13 2012 13 2013 14 ACTUAL BUDGET ESTIMATED ADOPTED Available Fund Balance 10 01 $ $ $ $ 104,474 Revenues Bond Proceeds $ $ $ 136,822 $ Transfer from PID #2/TIF #4 Operating Fund Interest on Investments Total Revenues $ $ $ 136,822 $ Total Funds Available $ $ $ 136,822 $ 104,474 Expenditures Principal $ $ $ $ Interest 32,348 86,263 Agent Fees Bonds 175 Total Expenditures $ $ $ 32,348 $ 86,438 Available Fund Balance 09 30 $ $ $ 104,474 $ 18,036 Fund Description: This interest and sinking fund was created to track debt service payments related to the 2013B Certificates of Obligation issued to finance public improvements related to the Ranchview development. FY 20132014 Annual Operating Budget 381

Schedule of PID #2/TIF #4 Bonded Indebtedness to Maturity Year Principal Interest Total 2013 14 $ $ 86,263 $ 86,263 2014 15 86,263 86,263 2015 16 40,000 86,263 126,263 2016 17 120,000 85,462 205,462 2017 18 150,000 83,062 233,062 2018 19 175,000 80,063 255,063 2019 20 180,000 76,563 256,563 2020 21 185,000 72,963 257,963 2021 22 185,000 69,263 254,263 2022 23 190,000 65,563 255,563 2023 24 195,000 59,863 254,863 2024 25 200,000 54,013 254,013 2025 26 205,000 48,013 253,013 2026 27 215,000 41,863 256,863 2027 28 220,000 35,413 255,413 2028 29 225,000 28,813 253,813 2029 30 235,000 22,063 257,063 2030 31 240,000 15,013 255,013 2031 32 250,000 7,813 257,813 $ 3,210,000 $ 1,136,935 $ 4,346,935 Million PID #2/TIF #4 Ranchview Bonded Indebtedness to Maturity $4 $3 $2 $1 $0 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 Principal Interest FY 20132014 Annual Operating Budget 382