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LA PORTE REDEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2019 NOTE 1. CREATION OF CORPORATION The City of LaPorte, Texas (the "City") authorized the creation of the LaPorte Redevelopment Authority (the "Authority") by the Resolution No. 2000-19 passed on December 11, 2000. The Authority was created and organized as a local government corporation pursuant to provisions of Chapter 394 of the Texas Local Government Code. The Authority is organized as a public non- profit corporation for the purpose of aiding, assisting, and acting on behalf of the Cityi ythe performance of its governmental function to promote the common good and general,�eYare' of the Tax Increment Reinvestment Zone (the "Zone") and neighboring areas; to promote, elop, encourage and maintain housing, educational facilities, employment, commerce„%mod �ecomic development in the City. The Authority receives incremental tax revenues orf developed property. The Authority has participation agreements with the City of (LaPorte, La Porte Independent School District and Harris County to receive certain pro�OrffyAax increments. The Authority may issue bonds with consent of City Council. The Authonty4ianaged by a Board of Directors consisting of nine members who are appointed by tie M 6r with the approval of City Council. e. NOTE 2. SIGNIFICANT ACCOUNTING POLICES The accompanying financial statements have b 'n Trepared in accordance with accounting principles generally accepted in the United .Sta es of America as promulgated by the Governmental Accounting Standards Board (` W 8� 5). GASB has established the criteria for deterrmhirig whether or not a given entity is a component unit. The criteria are: (1) is the potent l ofiponent unit a legally separate entity, (2) does the primary government appoint aot#ngajority of the potential component unit's board, (3) is the primary government able t9impoge- its will on the potential component unit, (4) is there a financial benefit or burden relt fiship. The Authority was created as an instrumentality of the City. The Authority does meet the criteria for inclusion as a component unit of the City. Copies of the financial statementAor the City may be obtained from the City Secretary's office. A � � e Financial Statej,ne'nt Pfe'sentation These finahave been prepared in accordance with GASB Codification of Gover—mrrb Vital' Accounting and Financial Reporting Standards Part II, Financial Reporting (` 6A B")C, odification"). The GASB Codification sets forth standards for external financial reporting for all state and local government entities, which include a requirement for a Statement of Net Position and a Statement of Activities. It requires the classification of net position into three components: Net Investment in Capital Assets; Restricted; and Unrestricted. These classifications are defined as follows: -12-