Mhm.
» Very good.
afternoon, everyone, and welcome to
the Harlingen City Commission special
meeting. The time is now 5:30. We'll
call this meeting to order. It It has
been posted as required by state law. We
have a quorum of the commission as
everyone is present. At this time, I'll
ask everyone to please rise as
Commissioner Modales leads us in our
invocation.
In the name of the Father, Son, Holy
Spirit. Amen.
Heavenly Father, as we enter this holy
week,
we pray for the wisdom to understand the
true meaning of Easter,
making us worthy of the promises of your
son, our Lord and Savior, Jesus Christ.
Amen. Amen.
And the pledge?
>> [clears throat]
>> I pledge allegiance to the flag of the
United States of America, and to the
republic for which it stands, one nation
under God, indivisible, with liberty and
justice for all.
Do any of you have any conflicts of
interest
Under state law, a conflict of interest
exists by council member or certain
members of that person's family has a
qualifying financial interest in an
agenda item. Members with a conflict of
interest cannot participate in the
discussion or vote on the agenda item.
Are there any known conflicts of
interest to disclose at this time?
None. None. None. None. None. None.
All right. Moving on. Um it is my
understanding, Miss Meyer, we don't have
anyone signed up for citizen
communication. So, we'll go right into
our action items. We have a presentation
and acknowledgement from the city of
Harlingen's annual comprehensive
financial report for fiscal year
2024-2025
from Castellanos and Associates. Good
evening, Mayor and commissioners. Uh we
did conclude our audit last week. And
so, we have Alfred Vera from Castellanos
and Associates here to give a brief
overview and presentation of our
audit and financial statements.
Good evening, Madam Mayor
and commissioners. My name is Alfred
Vera. I am a principal with Castellanos
and Associates, and it's been a pleasure
working with you all, uh working with Robert and his his group. Um
Things are a lot go a lot easier when
you get good cooperation, when things
are well organized, and you go through
the audit and request items and they're
provided. So,
uh I want to give, you know, thanks to them and for you all on the oversight
as well. And we thank you all for
choosing us to do your audit again this
year.
I'm here to present to you the annual
comprehensive financial report for the
year ended September 30th, 2025. I will
go through a couple of items um
interest on the report, and then if you
all have any questions, I can answer
those. Anything more
specific, I will turn it over to to
Robert.
>> [clears throat]
>> If you'll turn with me over to page 31.
contains the independent
auditor's report.
As independent auditors, what we do, we
come into an entity, we review the
policies and procedures, and then we
pull samples, and we test against those
policies and procedures, and we review
the financial statements, and we provide
reasonable assurance that the financial
statements are fairly stated and free of
material misstatements. However, we do
not provide absolute assurance because
of our our limited scope. If we were to
do that, we would just we would to test
all transactions, and that would be very
costly and it would take a long time.
But, from what we have reviewed and
tested,
the city of Harlingen for the year ended
September 30th, 2025 has earned an
unmodified or clean opinion.
This is the best opinion that an entity
can receive. So, congratulations on
that.
The reason The reason that I say it is
earned is because of the work that is done here by the finance group,
the city, and you all as an oversight as
well.
If you'll turn with me over to page 37.
contains [clears throat] the
management's discussion and analysis.
The management discussion and analysis,
otherwise known as the MD&A, contains
financial highlights and analysis,
comparisons to prior year, which is
2024.
Uh
the comparisons include comparisons for
the net position,
the statement of activities of the
primary government,
and capital assets and long-term debt.
» [snorts]
>> Now, if you'll turn with me over to page
57.
contains the balance sheet for
the governmental funds.
For tonight's purposes, I will be going
over the general fund.
>> [clears throat]
>> At September 30th, 2025, the city of
Harlingen had total assets of 46 million
390,000,
and a total fund balance in the general
fund of 41 million 302,000,
of which 37 million 44,000 is
unassigned.
This unassigned balance is what we refer
to as the rainy day fund.
The city can use this for any purpose
that it wishes at its discretion.
And we recommend that you do not use it
for anything that will deplete it, such
as salaries or raises, because you will
see how this plays into your days of
operations as I calculate those on the
next page up.
Page 59 contains the statement of
revenues, expenditures, and changes in
fund balances for governmental funds.
Again, I'm looking at the general fund.
For the year ended September 30th, 2025,
total revenues for the city of Harlingen
were $66,508,000,
total expenditures of $70,810,000,
[clears throat]
and total other financing sources of
$7,466,000.
Now, if we take your total expenditures
of the $70,000,000
809,
and we divide that by 365,
you get $192,000.
That is what on average it is costing
the city to open its doors each and
every day.
Now, if we take your unassigned fund balance
of $37,000,000
44,000, and we divide it by 194,000,
you get 191 days 191 days of operations.
This means should no more money come
into the city, would be able to operate for
about 191 days. This is very good. We
normally recommend anywhere between 60
and 90 days. You all are well above
that.
Now, it's nothing to, you know,
say we bring it down, or increase
[clears throat] it. It's just your
comfort level, but this is very, very
good. So, congratulations on maintaining
that [clears throat]
healthy days of operations.
If you'll turn over with me to page 74, contains the notes to the
financial statements.
contain summary of accounting policies,
some information regarding the component
units,
details on deposits and investments,
and more detailed information related to
capital assets and long-term debt.
Notes [clears throat] to the financial
statements also contain information
related to the pension plans, and the
other post-employment benefits,
otherwise known as the OPEB.
And the last two items towards the very
back of the report,
the first being the on page 361 is the
independent auditor's report on internal
control over financial reporting and
compliance based on an audit of the
government auditing standards.
>> [clears throat]
>> We do not provide an opinion on the internal controls, but from the
testing that we have found, there have
been no instances of non-compliance
related to internal controls.
Congratulations on that as well.
And the last item on page 365
is [clears throat] an independent
auditor's report on compliance for each
major program and internal controls over
compliance required by the uniform
guidance. This is what is known as the
single audit.
From the programs that we have tested,
we found no instances of of
non-compliance and no significant
deficiencies or material weaknesses.
This is also an unmodified opinion for a
clean opinion. Congratulations on that
as well.
This concludes my presentation. Do you
all have any questions?
I don't have a question, but I would
like to add that
uh
in compliance with the state statute,
they filed a copy of the
from the captain, which is the city
secretary,
on Friday,
and it's already on our
on the minutes.
>> [clears throat]
» So, thank you
for doing a great job again. And I also
want to thank our our finance department
year after year.
Even way before I was here, they've been doing a great job and
continuing excellence in providing the
opportunity for everybody to see on on
our on our website, obviously, is is
important. Thank you for for your hard
work. Thank you, of course, to
our finance department. Thank you.
And
uh Commissioner? Yeah, uh
you mentioned the retirement plan. Uh
we did have the defined benefit plan
when I came in 13 and a half years ago,
and markets went south and the city owed
the actuary millions of dollars
to keep the defined benefit actuarial
people happy. And so, uh today was an
update in market, but year to date, it's
a down market. And should this continue,
uh we all know there's headlines uh in
the news, then we So, don't get
poisoned by our own uh when you hear 191
days of balance, because we may have to
pony up later in the year millions
to keep the defined benefit plan
solvent.
And I will also to that end just add
that, you know, year after year, each
session of the legislature has looked at
uh reducing funds for cities in terms of
property tax. [clears throat] So, we
definitely want to keep an eye on that
moving moving forward. But, in the
interim uh or in the meantime, we've we've got a very healthy uh
operating budget, working budget, and
rainy day fund. And so, that's to the
incredible work of uh
staff and and city manager also for
doing a great job and his uh staff as
well. Is there any other um comments or
questions from the commission at this
time?
>> [snorts]
>> Having no other
uh questions, then I think We just need
to acknowledge the equipment. Yes, but
with Mr. With Mr. Lopez.
Okay, so at this time we'll just
acknowledge um the report as presented.
Um It doesn't show I don't think we need
to
You you you can move to acknowledge the
report. Okay, can I get a a motion to
acknowledge the presentation and
acknowledgement of the city of
Harlingen's annual comprehensive
financial report for fiscal year
2024-2025
by Gasso & Associates?
>> Motion to that motion. Second. Motion by
Commissioner Lopez, second by
Commissioner Pederson. All those in
favor signify by saying "Aye." Aye.
All those opposed? Motion carries. Thank
you so much, and that is all the items
that we have on our agenda. So, thank
you. We are adjourned.
I agree.
» [laughter]