City of Sugar Land

2017 Houston Investor Conference

April 24, 2017

About Sugar Land

Fort Bend County

25 Miles SW of Houston

Incorporated in 1959

Home Rule City

Council-Manager form of

government

Mayor – At Large

Two At-Large Council

Members

Four District Council

Members

Demographics

City Land Area (Sq. Mi) 36.47

ETJ Land Area (Sq. Mi) 19.67

2017 Population Estimate 87,730

Foreign born 34.4%

Bachelors degree or higher 55.5%

Median Household Income $104,939

Property Tax Base- 2016 $12.6 B

Average Home Value- 2016 $371,730

White

44%

Asian

36%

Hispani

c

10%

Black

8%

Other

2%

Early Days: 1907-1959

Sugar Land Then & Now

Sugar Land Then & Now

How has Sugar Land

Changed? During my Tenure…

2000 2017 % Change

Population 62,637 87,730 +40%

Area in Sq. Mi. 24.64 36.34 +47%

Taxable Value $4.45B $12.6B 171%

Tax Rate $0.3583 $0.31595 -12%

City Employees 431 777 80%

Fire Stations 4 7 75%

Park Acreage 311 2,132 586%

Sales Tax % of GF Rev 54% 47% -7%

Prop Tax % of GF Rev 15% 25% +10%

Destination Projects

Smart Financial Centre at

Sugar Land

One of a Kind, State of the Art Facility

200,000 square feet

Seating from 3,000 to 6,400

14 Luxury Suites

Corporate Hospitality Areas

2,500 on-site parking spaces

Smart Financial Centre at

Sugar Land

PICK YOUR FAVORITE

Comedy:

Jay Leno

Chris Rock

Trevor Noah

Concerts

John Mellencamp

Santana

Boston

Hank Williams Jr.

Diana Ross

Rod Stewart

Melissa Etheridge

Ringo Starr

Bryan Adams

Sturgill Simpson

Smart Financial Centre

Project Funding $91.45M

Source Amount

4A Economic Development

Sales Tax (Bonds & Cash)

$46.45

Tax Exempt CO’s: Hotel Tax 8.0

Taxable CO’s (Lease Revenues) 27.0

ACE SL, LLC Contribution 10.0

Total Funding $ 91.45

Constellation Field

Completed in 2012 for $36 million

Home to the Sugar Land Skeeters

Funded by 4B Sales Tax Revenue Bonds

Built to AAA Club Standards

Corporate Expansions

Future Business Park

Former TDCJ Central Prison Unit

142 Acres with One Historic Building

Acquired Sept 2016

TIRZ #4 Development

Mixed Use Planned

Development District

Home to:

Smart Financial Centre

5 Acre Public Plaza

Texas Instruments

Fluor Corporation

University of Houston at Sugar Land

Festival Site

2017 Annexation:

Greatwood & New Territory

Annexation Planning

Q: How do you plan for a 34% increase

in the City’s population at one time?

A: Strategic Planning & Policy

Guidance

For 10+ years, the City has monitored the

conditions of all Master Planned

Communities in the City’s ETJ

Factors in Annexation

Analysis

Financial Factors:

Ensure neutral impact to current residents

Revenues generated from annexed areas

support cost of services

Property & Sales Taxes

Water Utility Revenues

Outstanding MUD Debt

City Assumes upon Dissolution

Factors in Annexation

Analysis

Service Delivery:

No negative impact to existing residents

Fire Protection Services- already providing

EMS Transport- Replace FB County EMS

Police Protection

US59/I-69 Construction

Brazos River: location of development

Mandated Groundwater Reduction

Strategic Partnership

Agreements: 2007

Define terms of annexation MUDs to be Dissolved upon Annexation

City assumes outstanding debt

Provision of services in the interim Fire Protection /Cost of Service

Out of City Service Charges

Fire Station #7 Construction / Participation

Groundwater Reduction Plan (GRP)

Participation

Changes from Annexation

Financial Management

and Trends

CITY OF SUGAR LAND

Financial Management

Policies

Approved by City Council Resolution

Includes guidance on:

Budgeting & long range financial planning

Structural balance

Corrective actions in an economic downturn

Use of one-time funding sources

Tax rate setting guidance

Fund balance requirements

Debt structure & management

Strong Financial Policies

Bond ratings

Strong policies referenced by rating

agencies

Not only that they exist, but they are

followed

Council provides a clear roadmap to

guide staff in financial matters

Staff has an approved reference for

planning the City’s finances

Financial Management

Policies

Initially adopted in 2002

Reviewed & Amended 7 times since

Policies adapt as the City grows & changes

Reviewed every 2 years

Amended via City Council Resolution

Strategic Planning Linked to

Budget & Financial Planning

Being engaged in projects in the planning

stages allows finance to build in impacts to

future budgets.

Capital Improvements Needed

Debt Capacity/ Alternate Funding Sources

Operating Budget Impact

Some Resources are Restricted

Economic Development Sales Tax

Population Growth

78.0 84.5 84.5 86.5 87.5

117

40

50

60

70

80

90

100

110

120

FY08 FY10 FY12 FY14 FY16 FY18

THO

USA

ND

S

City Population Pop after Annex

Assessed Values (NAV in $ Billions)

$7.6

$8.7 $9.3 $9.3 $9.5 $9.7

$10.3 $10.9

$12.0 $12.6

$13.2

$16.7 $17.4

$18.0 $18.6

$0

$2

$4

$6

$8

$10

$12

$14

$16

$18

$20

FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22

Debt as a % of Noncapital Exp’s

Governmental Funds

26%

22%

19%

21%

24%

21% 20% 20%

21% 22%

0%

5%

10%

15%

20%

25%

30%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

General Government

Tax Revenues

23 26 29 28 28 30 31 34 37

29 30 28 30 33 34 37

39 39 6

6 7 7 7

8 8

8 8

-

10

20

30

40

50

60

70

80

90

2008 2009 2010 2011 2012 2013 2014 2015 2016

MIL

LIO

NS

Property Tax General Sales Tax Franchise & Other Taxes

General Fund Balances

-

5

10

15

20

25

30

35

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

MIL

LIO

NS

Ending Balances per CAFR

General Fund Balances Minimum by Policy 25%

Capital Improvement Program

Airport

3%

Drainage

23%

Municipal

4%

Parks

3%

Streets

36%

Traffic

2%

WW

3%

Water

6%

Surface

Water

20%

FY17 Budget: $74.2M

Airport

2%

Drainage

26%

Municipal

4%

Parks

10%

Streets

31%

Traffic

2%

WW

9%

Water

8%

Surface

Water

8%

FY17-21 Plan: $176.9M

2013 Park Bonds

November 2013 – Park Bond Election

First GO Bond Election since 1999

Est Impact at $50M was 5 cents on tax rate

Total Approved $31.46 million

(2) Brazos River Park/ Festival Site $21.46M

(3) Hike & Bike Trails $10.00M

Proposition (1) Failed

Community Sports Park $18.54M

Margin of 49% to 51%

Imperial Connector Trail Complete

Brazos River Park – Phase I Complete

Festival Site Complete

Brazos River Park – Phase II Complete

Ditch H Trail – Phase I FY18

Ditch H Trail – Phase II FY19

Brazos River Park – Final Phase In Design

First Colony Trails In Design

GO Bond Project Status

Debt Service Requirements Tax Backed Issues

$0

$5

$10

$15

$20

$25

$30

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

20

31

20

32

20

33

20

34

20

35

20

36

20

37

20

38

20

39

20

40

MIL

LIO

NS

Current Debt Greatwood & New Territory Debt

Net Bonded Debt per Capita Tax Backed Only

$0

$500

$1,000

$1,500

$2,000

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

Current Estimated

Investment in Infrastructure

-

50

100

150

200

250

300

350

400

450

500

2010 2011 2012 2013 2014 2015 2016

MIL

LIO

NS

Outstanding Principal at FY End

Tax Backed Utility Airport Surface Water 4A 4B Taxable

Investment in Infrastructure

Key Projects Funded 2011-2017

Surface Water Treatment Plant

Constellation Field

Smart Financial Centre at Sugar Land

Park GO Bond Projects

Major Drainage and Roadway

Improvements

THANK YOU!