The Plum Creek Conservation District (District) is a conservation and reclamation district that was created by the 55th Legislature of the State of Texas and confirmed by the eligible voters within the Plum Creek Watershed in September 1959. It was created under the provisions of Section 59 Article XVI of the Texas constitution and operates pursuant to Chapter 49 of the Texas Water Code exercising powers described in Chapters 51 and 36 of the Texas Water Code. Under Chapter 52, the District is empowered to control, conserve, protect, distribute and utilize the storm and flood waters and unappropriated flow of Plum Creek and for the preservation, conservation, protection, recharge and prevention of waste and pollution of underground water of the District, except in those areas that are part of the Edwards Underground District or the Barton Springs/Edwards Aquifer Conservation District on January 1, 1989. In evaluating how to define the District, for financial reporting purposes, management has considered all potential component units. The decision to include a potential component unit in the reporting entity is made by applying the criteria set forth in generally accepted accounting principles. The District is a separate self-supporting governmental unit covering portions of two counties and is administered by a board of six members who are appointed by the Commissioners of each county. The District is in compliance with the requirements of Texas Water Codes 50.371, Duty to Audit, and 50.381, Policies and Audits of Districts.
The accounting and reporting policies of the District conform to U.S. generally accepted accounting principles applicable to state and local governments promulgated by the Governmental Accounting Standards Board (GASB) and the American Institute of Certified Public Accountants (AICPA). The following is a summary of the significant accounting policies. GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS The District is considered a special purpose government under GASB Statement No. 34. This allows the District to present the required fund and government-wide statements in a single schedule. The requirement for fund financial statements to be prepared on the modified accrual basis of accounting is met with the “General Fund” column. An adjustment column includes those entries needed to convert to the full accrual basis government-wide statements. The Statement of Net Position and the Statement of Activities are government-wide financial statements. They report information on all of the District’s activities. The District services are supported primarily by general revenues, including property taxes and investment income. Additionally, the District receives some grant revenue. The Statement of Activities demonstrates how the District used revenue and demonstrates how direct expenses of a given function are offset by program revenues. MEASUREMENT FOCUS AND BASIS OF ACCOUNTING The government-wide financial statements are reported using the flow of economic resources measurement focus and the full accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Taxes are recognized as revenues in the year for which they are levied. Governmental fund financial statements use the modified accrual basis of accounting. This basis of accounting recognizes revenues in the period in which they become susceptible to accrual, i.e. both measurable and available. Revenues are considered to be available when they are collectible, within 10 PLUM CREEK CONSERVATION DISTRICT NOTES TO FINANCIAL STATEMENTS NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES the current period or soon enough thereafter to pay liabilities of the current period (defined by the District as collected within 60 days of year end). Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred. The reported fund balance of governmental funds is considered a measure of available spendable resources. The revenues susceptible to accrual are property taxes, grant income, and investment income. All other governmental revenues are recognized when received, as they are deemed immaterial. NET POSITION Net position represents the difference between assets, deferred outflows and inflows, and liabilities. Net position invested in capital assets consists of capital assets, net of accumulated depreciation. Net position is reported as restricted when there are limitations imposed on its use either through the enabling legislation adopted by the District or through external restrictions imposed by creditors, grantors or laws or regulations of other governments. When both restricted and unrestricted resources are available for use, it is the District’s policy to use restricted resources first and then unrestricted resources as they are needed. FUND BALANCES Fund balance of governmental funds is reported in various categories based on the nature of any limitations requiring the use of resources for specific purposes. The District can establish limitations on the use of resources through either a commitment or an assignment. When both unassigned and committed or assigned funds are available for expenditure, committed or assigned funds are used first. Nonspendable fund balances are amounts that cannot be spent because they are not in a spendable form or legally or contractually required to be maintained intact. Committed fund balances include amounts that can only be used for specific purposes determined by a formal action of the Board or adoption of an ordinance. Limitations imposed by commitments remain in place until formal Board action is taken to remove the limitation. Amounts in the assigned fund balances are intended to be used by the District for specific purposes but do not meet the criteria to be committed. Assignments are generally temporary and do not require Board action to be taken to remove the assignment. DEFERRED OUTFLOWS/INFLOWS OF RESOURCES The statement of net position and governmental funds balance sheet reports a separate section for deferred outflows of resources representing a consumption of net position that applies to a future period and is not recognized as an outflow of resources in the current period. These amounts are deferred and recognized as an outflow of resources in the period the amounts become due. The District does not have any deferred outflows. The statement of financial position and governmental funds balance sheet reports a separate section for deferred inflows of resources representing an acquisition of net position that applies to a future period and is not recognized as an inflow of resources or revenue until that time. The District has two items which qualify for reporting in this category- deferred inflows from unavailable property tax revenue and unavailable grant revenue. These amounts are deferred and recognized as an inflow of resources in the period the amounts become available. 11 PLUM CREEK CONSERVATION DISTRICT NOTES TO FINANCIAL STATEMENTS NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BUDGET The District adopts annual budgets for the General Fund. The District amends the budgets as needed during the year. All annual appropriations lapse at fiscal year end. Certain revenue and expenses were different than budgeted, resulting in higher than budgeted fund balance. Primarily, property tax revenue, grants, investment income and rehabilitations and repairs expenses were more than anticipated; and payroll and related, professional fees and other expenses were less than budgeted. SHORT-TERM INVESTMENTS All short-term investments at year end were held in certificates of deposits, which are recorded at cost, and investments in the Texas Local Government Investment Pool (TexPool). TexPool is carried at amortized cost, which approximates fair value. CAPITAL ASSETS Assets with a value of $5,000 or more and useful life of two years or more are capitalized. Capital assets are recorded at historical cost or estimated historical cost if actual historical cost is not available. Donated capital assets are recorded at their estimated fair value at the date of the donation. Repairs and maintenance are recorded as expenditures or expenses; renewals and betterments are capitalized. Depreciation has been calculated on each class of depreciable property using the straight- line method. Furniture and equipment 5-10 years Buildings 40 years COMPENSATED ABSENCES Accruals for compensated absences are based on years of service with the District. Hours may be accrued up to a maximum allowable amount based on the preceding 52 pay periods. ESTIMATES The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates.
At year end, the District’s carrying value of cash was $68,464 and the bank balance was $96,476. Additionally, the District had $725,310 invested in certificates of deposit and money market accounts, and $28,820,856 invested in TexPool. Interest Rate Risk Interest rate risk is the potential for a decline in market value due to rising interest rates. The District does have a formal investment policy in place. The District’s cash and cash equivalents are currently 12 PLUM CREEK CONSERVATION DISTRICT NOTES TO FINANCIAL STATEMENTS NOTE 3: DEPOSITS WITH FINANCIAL INSTITUTIONS invested in short-term instruments such as certificates of deposits, money market funds and an interest-bearing checking account. Credit Risk The Board has authorized the District under a written investment policy to invest funds in compliance with V.A.T.C.S Government Code, Title 10, Chapter 2256 (the Public Funds Investment Act of 1993). Investment vehicles authorized by Chapter 2256 include, but are not limited to, certificates of deposit, obligations backed by the U.S. and state governments, and public fund investment pools. All investments at year end were held in certificates of deposits and the Texas Local Government Investment Pool (TexPool). TexPool investments are carried at amortized cost, which approximates fair value. The State Comptroller oversees TexPool, with Federated Investors managing the daily operations of the pool under a contract with the State Comptroller. TexPool is a 2(a)7 like fund, which means that it is structured similar to a money market mutual fund. It allows shareholders the ability to deposit or withdraw funds on a daily basis. Such funds seek to maintain a constant net asset value of $1.00, although this cannot be fully guaranteed. TexPool is rated AAAm (the highest rating a local government investment pool can achieve) and must maintain a dollar weighted average maturity not to exceed 60 days, which is the limit. At year end, the TexPool portfolio had a weighted average maturity of 41 days. Custodial Credit Risk In the case of deposits, this is the risk that in the event of a bank failure, the District’s deposits may not be returned to it. As of year end, the District had no uncollateralized cash deposits in excess of federal depository insurance coverage. The District has not experienced any losses due to custodial credit risk.
The District’s property taxes are levied each October 1, and are payable by the following January 31, on 100% of assessed value listed for all real and personal property located in the District. Assessed values are established by the Caldwell County and the Hays County Tax Appraisal Districts and are collected by the Caldwell County and Hays County Tax Assessors/Collectors. Property taxes attach as an enforceable lien on property as of January 1 of each year. Since an enforceable lien attaches to the taxed properties, the District considers all delinquent tax receivables to be fully collectible. Accordingly, no allowance for doubtful accounts is required. The tax rates for fiscal year 2025 for both Hays and Caldwell Counties, were $.014 (conservation) and $.0158 (groundwater) per $100 assessed valuation.
The District is exposed to various risks of loss related to torts, theft, damage and destruction of assets, errors and omissions, injuries to employees and natural disasters. The District insures against these risks through participation in the Texas Water Conservation Association Risk Management Fund, a pool consisting of Texas water districts and authorities. The District pays premiums for its general liability, property, auto and workers’ compensation coverage. The District’s risk is limited to the amount of premiums paid unless the pool should fail, in which case, the District would be liable for its ratable share of the pool deficit.
The District has established a Simple IRA plan for all full time employees. The IRA accounts are owned by the employees and not the District. The District contributes a matching contribution of up to 3% of annual base pay. The District’s contribution to the plan for the fiscal year was $9,760
Beginning Balance Additions Deletions Ending Balance Capital assets not being depreciated: Land and easements $293,741 $0 $0 $293,741 Capital assets being depreciated: Building 581,393 0 0 581,393 Furniture and equipment 67,498 13,266 0 80,764 Total capital assets being depreciated 648,891 13,266 0 662,157 Accumulated depreciation: Building (186,204) (14,535) 0 (200,739) Furniture and equipment (60,007) (4,909) 0 (64,916) Total accumulated depreciation (246,211) (19,444) 0 (265,655) Net capital assets being depreciated 402,680 (6,178) 0 396,502 $696,421 ($6,178) $0 $690,243 The District is responsible for maintaining Floodwater Retarding Structures originally valued at a cost of $3,221,476, however the District does not own the structures.
At year end, the District had the following commitments for contracts related to dam rehabilitation and repairs: Vendor Name Site # Total Contract Amount Remaining Commitment at September 30, 2025 Southern Infrastructure Group, LLC 28 $12,122,721 $2,309,353
Fund balance - general fund $29,796,579 Capital assets used in governmental activities are not financial resources reported in the general fund. 690,243 Property taxes receivables are deferred inflows in the fund financial statements and not in the government-wide financial statements. 138,769 Grant receivables related to reimbursements expected to be received more than 60 days after year end are deferred inflows in the fund financial statements and not in the government-wide financial statements 409,477 Long-term accrued leave expected to be paid more than 60 days after year end is not reported in the fund financial statements. (47,723) Long-term retainage payable expected to be paid more than 60 days after year end is not reported in the fund financial statements (606,136) Net position - governmental activities $30,381,209 Change in fund balance- general fund $5,470,040 Depreciation expense not recorded in the fund financial statements. (19,444) Change in accrued leave not reported in the fund financial statements 14,713 Capital outlay is reported as an expenditure in the fund financial statements 13,266 Change in retainage payable recognized as expenditures in the fund financial statements 376,178 Change in taxes receivable deferred in the fund financial statements and not in the government-wide financial statements (73,990) Receivables not collected within 60 days after year end are considered unavailable and thus not recorded as revenue in the fund financial statements but are recorded in the government-wide financial statements. (1,995,589) Change in net position - governmental activities $3,785,174
The District has been advised by the Natural Resources Conservation Service (NRCS) that twenty- three watershed sites have been classified as high hazard. As required by 30 TAC §299.61, an owner of a high hazard dam shall prepare an Emergency Action Plan (EAP). The District has prepared and submitted multiple EAPs, which subsequently have been approved by the Texas Commission on Environmental Quality. These dams are Site #1, #2, #3, #4, #5, #6, #7, #10, #12, #14, #16, #17, #18, #21, #24, #26, #28, #29, #31, #34, and #38. 15 PLUM CREEK CONSERVATION DISTRICT NOTES TO FINANCIAL STATEMENTS NOTE 10: OTHER MATTERS The District is involved in ongoing discussions with their legal counsel and NRCS to pursue options available under federal grants. The District has had the following developments with respect to the repair of the high hazard dams. Sites #2, #12, #17, #21 and #28 - The District received grant funds in connection with NRCS and Texas State Soil and Water Conservation Board (TSSWCB), through the United Stated Department of Agriculture, and its Watershed Rehabilitation Program and TSSWCB’s grant program for repairs and upgrades for the dams to be able to pass 75% of the Probable Maximum Flood event. Site 2 construction expenses were reimbursed by the State at 98.25% and contract administration expenses (in-kind) were reimbursed at 2.25% of the invoiced construction amount. Sites 12 and 28 are reimbursed by Federal grants at 65% and by State grants at 35% for both construction and contract administration expenses. Site 21 construction and contract administration expenses are reimbursed by a Federal grant at 65% and by a State grant at 33.25%, with the District responsible for 1.75%. Site 17 Repair Project is a state-funded only project and will be reimbursed at 100% for construction expenses and 5% for contract administration expenses. At year end, the Site 2 and Site 21 projects have been completed. There are two ongoing dam projects: Site 28 Rehabilitation Project and Site 17 Repair Project. The Site 12 Rehabilitation Project will begin construction in January of 2026.
Effective October 1, 2024, the District adopted Governmental Accounting Standards Board (GASB) Statement No. 101, Compensated Absences (GASB 101) and subsequent amendments. This statement replaces GASB Statement No. 16. The adoption of GASB 101 has required a change in accounting principle for the recognition and measurement of liabilities for compensated absences, which includes sick leave, vacation, and other types of paid leave. In adopting the new standard, the District elected to use a transition method under which compensated absences were measured as of the date of adoption, October 1, 2024, in lieu of applying the standard retrospectively. Adoption of the standard did not have a significant effect on the financial statements.