Hidalgo County Drainage District No. 1 reports clean audit, proposes balanced 2026 budget with two stormwater positions

Hidalgo County Drainage District No. 1 received an unmodified ("clean") audit opinion for the year ended Dec. 31, 2024, and district staff presented a proposed calendar‑year 2026 budget that the board approved for submission at Tuesday's meeting.

The district's external audit partner, Luis Lopez, told the board the audit included federal single‑audit testing because the entity expended federal funds above the single‑audit threshold. He confirmed auditors found no instances of reportable noncompliance and no significant internal‑control deficiencies.

Nut graf: The audit indicates the district continues to maintain a sizable fund balance and to invest in construction activity. At the same meeting, staff proposed a balanced 2026 budget that would add two stormwater management technician positions focused on compliance and monitoring work.

Key audit findings and fund balance Lopez said the district's unassigned fund balance as of Dec. 31, 2024, was $26,034,846, representing roughly 300 days of operating coverage for the general fund on an illustrative basis. He noted the district's total cash and cash equivalents across governmental funds included bond proceeds and pooled investments, with total governmental funds cash and equivalents reported at about $216 million (the figure includes restricted bond proceeds and investment balances).

2026 budget proposal District accounting staff presented a proposed balanced budget for calendar year 2026 with total revenues and expenditures of approximately $33 million and two new full‑time positions titled stormwater management technician/specialist. Staff said the new positions will focus on stormwater compliance, illegal dumping monitoring, sediment control, and other regulatory tasks tied to the district's TCEQ programs.

Construction and project activity Auditors and staff noted the district showed an overall decrease in total governmental fund balance driven by construction activity funded from bond proceeds, and capital projects and construction‑in‑progress increased by more than $42 million during the year. The district also reported multiple projects submitted or being prepared for inclusion in the state Region 15 water planning process to be eligible for future state funding.

Board action The board voted to accept the audit report and to approve the proposed 2026 budget for further processing. Commissioners also approved a number of routine procurement, contract, and project items during the meeting.

What remains: staff said they will provide a follow‑up that breaks out certain recurring costs (for example, amounts paid to the appraisal district and acquisition/easement costs) at the next meeting.