[9:58] Mhm.

[14:13] » Very good.

[14:17] afternoon, everyone, and welcome to

[14:20] the Harlingen City Commission special

[14:22] meeting. The time is now 5:30. We'll

[14:26] call this meeting to order. It It has

[14:28] been posted as required by state law. We

[14:31] have a quorum of the commission as

[14:32] everyone is present. At this time, I'll

[14:35] ask everyone to please rise as

[14:36] Commissioner Modales leads us in our

[14:37] invocation.

[14:42] In the name of the Father, Son, Holy

[14:44] Spirit. Amen.

[14:46] Heavenly Father, as we enter this holy

[14:48] week,

[14:49] we pray for the wisdom to understand the

[14:51] true meaning of Easter,

[14:53] making us worthy of the promises of your

[14:55] son, our Lord and Savior, Jesus Christ.

[14:58] Amen. Amen.

[15:00] And the pledge?

[15:03] >> [clears throat]

[15:03] >> I pledge allegiance to the flag of the

[15:05] United States of America, and to the

[15:07] republic for which it stands, one nation

[15:10] under God, indivisible, with liberty and

[15:12] justice for all.

[15:18] Do any of you have any conflicts of

[15:20] interest

[15:21] Under state law, a conflict of interest

[15:23] exists by council member or certain

[15:25] members of that person's family has a

[15:26] qualifying financial interest in an

[15:28] agenda item. Members with a conflict of

[15:30] interest cannot participate in the

[15:32] discussion or vote on the agenda item.

[15:34] Are there any known conflicts of

[15:35] interest to disclose at this time?

[15:37] None. None. None. None. None. None.

[15:43] All right. Moving on. Um it is my

[15:45] understanding, Miss Meyer, we don't have

[15:47] anyone signed up for citizen

[15:48] communication. So, we'll go right into

[15:50] our action items. We have a presentation

[15:54] and acknowledgement from the city of

[15:56] Harlingen's annual comprehensive

[15:58] financial report for fiscal year

[15:59] 2024-2025

[16:02] from Castellanos and Associates. Good

[16:03] evening, Mayor and commissioners. Uh we

[16:05] did conclude our audit last week. And

[16:08] so, we have Alfred Vera from Castellanos

[16:10] and Associates here to give a brief

[16:12] overview and presentation of our

[16:14] audit and financial statements.

[16:20] Good evening, Madam Mayor

[16:21] and commissioners. My name is Alfred

[16:23] Vera. I am a principal with Castellanos

[16:25] and Associates, and it's been a pleasure

[16:27] working with you all, uh working with Robert and his his group. Um

[16:34] Things are a lot go a lot easier when

[16:37] you get good cooperation, when things

[16:39] are well organized, and you go through

[16:40] the audit and request items and they're

[16:43] provided. So,

[16:44] uh I want to give, you know, thanks to them and for you all on the oversight

[16:49] as well. And we thank you all for

[16:51] choosing us to do your audit again this

[16:53] year.

[16:54] I'm here to present to you the annual

[16:56] comprehensive financial report for the

[16:58] year ended September 30th, 2025. I will

[17:01] go through a couple of items um

[17:03] interest on the report, and then if you

[17:06] all have any questions, I can answer

[17:07] those. Anything more

[17:09] specific, I will turn it over to to

[17:11] Robert.

[17:12] >> [clears throat]

[17:12] >> If you'll turn with me over to page 31.

[17:29] contains the independent

[17:31] auditor's report.

[17:33] As independent auditors, what we do, we

[17:35] come into an entity, we review the

[17:41] policies and procedures, and then we

[17:43] pull samples, and we test against those

[17:46] policies and procedures, and we review

[17:49] the financial statements, and we provide

[17:51] reasonable assurance that the financial

[17:53] statements are fairly stated and free of

[17:56] material misstatements. However, we do

[17:58] not provide absolute assurance because

[18:00] of our our limited scope. If we were to

[18:03] do that, we would just we would to test

[18:05] all transactions, and that would be very

[18:07] costly and it would take a long time.

[18:09] But, from what we have reviewed and

[18:11] tested,

[18:13] the city of Harlingen for the year ended

[18:15] September 30th, 2025 has earned an

[18:17] unmodified or clean opinion.

[18:20] This is the best opinion that an entity

[18:22] can receive. So, congratulations on

[18:24] that.

[18:27] The reason The reason that I say it is

[18:28] earned is because of the work that is done here by the finance group,

[18:33] the city, and you all as an oversight as

[18:35] well.

[18:39] If you'll turn with me over to page 37.

[18:44] contains [clears throat] the

[18:46] management's discussion and analysis.

[18:49] The management discussion and analysis,

[18:50] otherwise known as the MD&A, contains

[18:53] financial highlights and analysis,

[18:56] comparisons to prior year, which is

[18:58] 2024.

[19:00] Uh

[19:00] the comparisons include comparisons for

[19:03] the net position,

[19:05] the statement of activities of the

[19:06] primary government,

[19:08] and capital assets and long-term debt.

[19:13] » [snorts]

[19:14] >> Now, if you'll turn with me over to page

[19:16] 57.

[19:21] contains the balance sheet for

[19:23] the governmental funds.

[19:25] For tonight's purposes, I will be going

[19:27] over the general fund.

[19:29] >> [clears throat]

[19:30] >> At September 30th, 2025, the city of

[19:33] Harlingen had total assets of 46 million

[19:36] 390,000,

[19:39] and a total fund balance in the general

[19:41] fund of 41 million 302,000,

[19:45] of which 37 million 44,000 is

[19:49] unassigned.

[19:50] This unassigned balance is what we refer

[19:53] to as the rainy day fund.

[19:55] The city can use this for any purpose

[19:58] that it wishes at its discretion.

[20:01] And we recommend that you do not use it

[20:03] for anything that will deplete it, such

[20:05] as salaries or raises, because you will

[20:08] see how this plays into your days of

[20:10] operations as I calculate those on the

[20:12] next page up.

[20:17] Page 59 contains the statement of

[20:19] revenues, expenditures, and changes in

[20:21] fund balances for governmental funds.

[20:23] Again, I'm looking at the general fund.

[20:27] For the year ended September 30th, 2025,

[20:30] total revenues for the city of Harlingen

[20:32] were $66,508,000,

[20:36] total expenditures of $70,810,000,

[20:38] [clears throat]

[20:40] and total other financing sources of

[20:43] $7,466,000.

[20:47] Now, if we take your total expenditures

[20:49] of the $70,000,000

[20:51] 809,

[20:53] and we divide that by 365,

[20:57] you get $192,000.

[21:00] That is what on average it is costing

[21:02] the city to open its doors each and

[21:04] every day.

[21:05] Now, if we take your unassigned fund balance

[21:13] of $37,000,000

[21:14] 44,000, and we divide it by 194,000,

[21:20] you get 191 days 191 days of operations.

[21:24] This means should no more money come

[21:26] into the city, would be able to operate for

[21:30] about 191 days. This is very good. We

[21:33] normally recommend anywhere between 60

[21:35] and 90 days. You all are well above

[21:37] that.

[21:38] Now, it's nothing to, you know,

[21:41] say we bring it down, or increase

[21:44] [clears throat] it. It's just your

[21:44] comfort level, but this is very, very

[21:47] good. So, congratulations on maintaining

[21:49] that [clears throat]

[21:49] healthy days of operations.

[21:55] If you'll turn over with me to page 74, contains the notes to the

[22:03] financial statements.

[22:06] contain summary of accounting policies,

[22:09] some information regarding the component

[22:11] units,

[22:12] details on deposits and investments,

[22:16] and more detailed information related to

[22:18] capital assets and long-term debt.

[22:23] Notes [clears throat] to the financial

[22:24] statements also contain information

[22:25] related to the pension plans, and the

[22:28] other post-employment benefits,

[22:29] otherwise known as the OPEB.

[22:33] And the last two items towards the very

[22:35] back of the report,

[22:41] the first being the on page 361 is the

[22:43] independent auditor's report on internal

[22:45] control over financial reporting and

[22:48] compliance based on an audit of the

[22:51] government auditing standards.

[22:53] >> [clears throat]

[22:54] >> We do not provide an opinion on the internal controls, but from the

[22:59] testing that we have found, there have

[23:01] been no instances of non-compliance

[23:04] related to internal controls.

[23:07] Congratulations on that as well.

[23:11] And the last item on page 365

[23:15] is [clears throat] an independent

[23:16] auditor's report on compliance for each

[23:17] major program and internal controls over

[23:20] compliance required by the uniform

[23:22] guidance. This is what is known as the

[23:24] single audit.

[23:25] From the programs that we have tested,

[23:27] we found no instances of of

[23:29] non-compliance and no significant

[23:31] deficiencies or material weaknesses.

[23:35] This is also an unmodified opinion for a

[23:37] clean opinion. Congratulations on that

[23:39] as well.

[23:42] This concludes my presentation. Do you

[23:43] all have any questions?

[23:46] I don't have a question, but I would

[23:47] like to add that

[23:49] uh

[23:49] in compliance with the state statute,

[23:51] they filed a copy of the

[23:53] from the captain, which is the city

[23:54] secretary,

[23:56] on Friday,

[23:57] and it's already on our

[23:59] on the minutes.

[24:00] >> [clears throat]

[24:02] » So, thank you

[24:04] for doing a great job again. And I also

[24:08] want to thank our our finance department

[24:10] year after year.

[24:12] Even way before I was here, they've been doing a great job and

[24:16] continuing excellence in providing the

[24:20] opportunity for everybody to see on on

[24:22] our on our website, obviously, is is

[24:24] important. Thank you for for your hard

[24:27] work. Thank you, of course, to

[24:29] our finance department. Thank you.

[24:32] And

[24:32] uh Commissioner? Yeah, uh

[24:35] you mentioned the retirement plan. Uh

[24:39] we did have the defined benefit plan

[24:43] when I came in 13 and a half years ago,

[24:46] and markets went south and the city owed

[24:49] the actuary millions of dollars

[24:51] to keep the defined benefit actuarial

[24:54] people happy. And so, uh today was an

[24:58] update in market, but year to date, it's

[25:01] a down market. And should this continue,

[25:06] uh we all know there's headlines uh in

[25:09] the news, then we So, don't get

[25:13] poisoned by our own uh when you hear 191

[25:18] days of balance, because we may have to

[25:21] pony up later in the year millions

[25:24] to keep the defined benefit plan

[25:27] solvent.

[25:29] And I will also to that end just add

[25:32] that, you know, year after year, each

[25:34] session of the legislature has looked at

[25:37] uh reducing funds for cities in terms of

[25:40] property tax. [clears throat] So, we

[25:41] definitely want to keep an eye on that

[25:44] moving moving forward. But, in the

[25:46] interim uh or in the meantime, we've we've got a very healthy uh

[25:51] operating budget, working budget, and

[25:54] rainy day fund. And so, that's to the

[25:56] incredible work of uh

[25:58] staff and and city manager also for

[26:01] doing a great job and his uh staff as

[26:03] well. Is there any other um comments or

[26:06] questions from the commission at this

[26:08] time?

[26:09] >> [snorts]

[26:11] >> Having no other

[26:13] uh questions, then I think We just need

[26:15] to acknowledge the equipment. Yes, but

[26:17] with Mr. With Mr. Lopez.

[26:21] Okay, so at this time we'll just

[26:22] acknowledge um the report as presented.

[26:29] Um It doesn't show I don't think we need

[26:31] to

[26:32] You you you can move to acknowledge the

[26:34] report. Okay, can I get a a motion to

[26:36] acknowledge the presentation and

[26:38] acknowledgement of the city of

[26:39] Harlingen's annual comprehensive

[26:41] financial report for fiscal year

[26:43] 2024-2025

[26:45] by Gasso & Associates?

[26:46] >> Motion to that motion. Second. Motion by

[26:48] Commissioner Lopez, second by

[26:50] Commissioner Pederson. All those in

[26:51] favor signify by saying "Aye." Aye.

[26:53] All those opposed? Motion carries. Thank

[26:56] you so much, and that is all the items

[26:58] that we have on our agenda. So, thank

[27:00] you. We are adjourned.

[27:04] I agree.

[27:07] » [laughter]

City Commission Special Meeting | 3-31-26

Transcript