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LA PORTE AREA WATER AUTHORITY <br />NOTES TO THE FINANCIAL STATEMENTS (continued) <br />EXHIBIT C I <br />Note 7 - Contract Revenue Bonds Payable, Debt Service Requirements and Bond Resolution. <br />Requirements (continued) <br />As of September 30, 2014, the debt service requirements on contract revenue bonds outstanding for the <br />next five fiscal years are as follows: <br />Due During <br />Fiscal Year <br />Annual Requirement for All Bond Series <br />Ending <br />Total <br />Total <br />Total <br />9/30 <br />Principal <br />Interest <br />Requirements <br />2015 <br />650,000 <br />41,838 <br />�$ 691,838 <br />2016 <br />670,000 <br />22,850 <br />692,850 <br />2017 <br />320,000 <br />6,400 <br />326,400 <br />$ 1,640,000 <br />$ 71,088 <br />$ 1,711,088 <br />Note 8 - Fund Net Position <br />The Authority provides surface water to the City of LaPorte, Texas (the "City") and the Cities of Shoreacres <br />and Morgan's Point in order for these entities to comply with certain requirements imposed by the Harris <br />County Subsidence District. The City retains the rights to approximately 86% of the water capacity of the <br />Authority with the Cities of Shoreacres and Morgan's Point retaining the rights to the remaining 14%. The <br />City, Shoreacres and Morgan's Point have agreed to service the debt on the Authority's contract revenue <br />bonds and to fund operations of the Authority in relation to their capacity rights and to purchase water based <br />on actual consumption. <br />As part of the debt service requirements, the participants are billed to build a reserve for future debt service <br />requirements as set forth in the contract revenue bonds of the Authority. During the year, the Authority's <br />billings were applied as follows: <br />Water Supplied and Operating costs(User fees) $ 1,081,189 <br />Debt Service Billings/ Charges 688,650 <br />Capital recovery billings 96,087 <br />Total Billings $ 1,865,926 <br />Note 9 - Risk Management <br />The Authority is exposed to various risks of loss related to torts; theft of, damage to and destruction of <br />assets; errors and omissions; and natural disasters for which the Authority participates (through an <br />endorsement on the City of La Porte's contract) along with other entities in the Texas Municipal League's <br />Intergovernmental Risk Pool. The pool purchases commercial insurance at group rates for participants in the <br />pool. Neither the o 'ty r e as a <br />. nal7as <br />r res o € t e p , outside of payment <br />of insurance prerni s. th u - ority ."i . tl re c urance coverage or <br />had settlements that ed e oun - , thehree atl s. <br />18 <br />