Financial Report
September 30, 2020

Towne Park Community Development District

Towne Park Community Development District
Table of Contents

 	Page
Financial Section:
Independent Auditor's Report	1
Management's Discussion and Analysis	3
Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position	7
Statement of Activities	8
Fund Financial Statements:
Balance Sheet - Governmental Funds	9
Statement of Revenues, Expenditures and Changes in Fund Balances -
Governmental Funds	10
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances -Governmental Funds
to the Statement of Activities	11
Statement of Revenues, Expenditures and Changes in Fund Balance -
Budget and Actual - General Fund	12
Notes to Financial Statements	13
Compliance Section:
Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards	22
Management Letter	23
Independent Auditor's Report on Compliance with the Requirements
of Section 218.415, Florida Statutes	25

934 North Magnolia Avenue, Suite 100
Orlando, Florida 32803
407-843-5406
www.mcdirmitdavis.com

INDEPENDENT AUDITOR'S REPORT

To the Board of Supervisors
Towne Park Community Development District

Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities and each major fund of the Towne Park Community Development District (the “District”), as of and for the fiscal year ended September 30, 2020, and the related notes to the financial statements which collectively comprise the District’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements
The District’s management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting principles used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, and each major fund of the Towne Park Community Development District as of September 30, 2020, and the respective changes in financial position thereof, and the respective budgetary comparison for the General Fund for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis starting on page 3, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued a report dated June 25, 2021, on our consideration of the Towne Park Community Development District’s, internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control over financial reporting and compliance.

Orlando, Florida June 25, 2021

Our discussion and analysis of the Towne Park Community Development District (the “District”) financial accomplishments provide an overview of the District’s financial activities for the year ended September 30, 2020. Please read it in conjunction with the District’s Independent Auditor’s Report, financial statements and accompanying notes.

This information is being presented to provide additional information regarding the activities of the District and to meet the disclosure requirements of Government Accounting Standards Board Statement (GASB) No. 34, Basic Financial Statements - and Management’s Discussion and Analysis - for State and Local Governments issued June 1999.

Financial Highlights
The assets of the District exceeded its liabilities at September 30, 2020 by $11,566,687, an increase in net position of
$9,390,878 in comparison with the prior year.
At September 30, 2020, the District’s governmental funds reported fund balances of $1,128,930 a decrease of $2,770,066 in comparison with the prior year.

Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the Towne Park Community Development District’s
financial statements.   The District’s financial statements comprise three components: 1) government-wide financial  statements,
2) fund financial statements and 3) notes to financial statements.

Government-Wide Financial Statements
The government-wide financial statements are designed to provide readers with a broad overview of the District’s finances, in a
manner similar to a private-sector business.

The statement of net position presents information on all of the District’s assets and liabilities, with the difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the District is improving or deteriorating.

The statement of activities presents information showing how the government’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods.

The government-wide financial statements include all governmental activities that are principally supported by special assessment revenues. The District does not have any business-type activities.  The governmental activities of the District  include general government and physical environment.

Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The District, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. The District has one fund category: Governmental funds.

Governmental Funds
Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a District’s near-term financing  requirements.

Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

The District maintains three individual governmental funds. Information is presented separately in the governmental fund  balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances for the general fund, debt service fund, and capital projects fund, which are considered to be major funds.

The District adopts an annual appropriated budget for its general fund. A budgetary comparison schedule has been provided for the general fund to demonstrate compliance with the budget.

Notes to Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements.

Government-Wide Financial Analysis
Statement of Net Position
The District’s net position was $11,566,687 at September 30, 2020. The following analysis focuses on the net position of the District’s governmental activities.

	 	2020		 	2019	
Assets, excluding capital assets	$	3,666,989		$	5,971,107	
Capital assets, net of depreciation	 	32,485,345 		19,540,906	
Total assets	 	36,152,334 		25,512,013	

Liabilities, excluding long-term liabilities	
2,964,634		
2,445,912	
Long-term liabilities	 	21,621,013 		20,890,292	
Total liabilities	 	24,585,647 		23,336,204	

Net Position:
Net investment in capital assets	

9,883,413		

1,220,156	
Restricted for debt service	261,326		243,916	
Restricted for capital projects	1,258,532		710,445	
Unrestricted	 	163,416 		1,292	
Total net position	  $	11,566,687 		  $	2,175,809 	

The following is a summary of the District’s governmental activities for the year ended September 30, 2020.

Changes in Net Position

Revenues:	 	2020		 	2019	
Program revenues	$	11,135,072		$	3,339,972	
General revenues	 	22,534 		811	
Total revenues	 	11,157,606 		3,340,783	

Expenses:
General government	

421,548		

422,736	
Physical environment	211,034		109,321	
Interest on long-term debt	 	1,134,146 		859,134	
Total expenses	 	1,766,728 		1,391,191	
Change in net position	9,390,878		1,949,592	
Net position, beginning of year	 	2,175,809 		226,217	
Net position, ending	  $	11,566,687 		  $	2,175,809 	

As noted above and in the statement of activities, the cost of all governmental activities during the year ended September 30, 2020 was $1,766,728, the majority were interest on long term debt.

Financial Analysis of the Government’s Funds
The District uses fund accounting to ensure and demonstrate compliance with finance related legal requirements. The focus of the District’s governmental funds is to provide information on near-term inflows, outflows and balances of spendable resources. Such information is useful in assessing the District’s financing requirements. In particular, unassigned fund balance may serve  as a useful measure of a government’s net resources available for spending at the end of the fiscal year. At September 30,  2020, the District’s governmental funds reported combined ending fund balances of $1,128,930. Of this total, $68,526 is non- spendable, $1,837,469 is restricted for debt service and the remainder of $(777,065) is unassigned.

The General Fund increased $90,562 due to assessment revenue exceeding expenditures. The debt service fund balance increased by $368,571 because of debt issued. The capital projects fund balance decreased $3,229,199 due to capital outlay.

General Fund Budgetary Highlights
An operating budget was adopted and maintained by the governing board for the District pursuant to the requirements of Florida Statutes. The budget to actual comparison for the general fund, including the original budget and final adopted budget, is shown on page 12. The budget is adopted using the same basis of accounting that is used in preparation of the fund financial statements. There were no budget amendments during the year. The legal level of budgetary control is at the fund level.

Capital Asset and Debt Administration
Capital Assets
At September 30, 2020, the District had $32,485,345 invested in infrastructure under construction. More detailed information
about the District’s capital assets is presented in the notes to financial statements.

Capital Debt
At September 30, 2020, the District had $21,565,000 in bonds outstanding. More detailed information about the District’s capital
debt is presented in the notes to financial statements.

Requests for Information
If you have questions about this report or need additional financial information, contact the Towne Park Community Development District’s Finance Department at 219 E. Livingston Street, Orlando, Florida 32801.

FINANCIAL  STATEMENTS

Assets:	Governmental
 	Activities	
Cash	$	393,436	
Assessment receivable	172,167	
Due from the developer	1,258,464	
Prepaid costs	64,026	
Deposits	4,500	
Restricted Assets:		
Temporarily restricted investments	1,774,396	
Capital Assets:		
Capital assets not being depreciated	 	32,485,345 	
Total assets	36,152,334	

Liabilities:		
Accounts payable and accrued expenses	2,538,059	
Accrued interest payable	426,575	
Noncurrent Liabilities:		
Due within one year	355,000	
Due in more than one year	 	21,266,013 	
Total liabilities	 	24,585,647 	
Net Position:		
Net investment in capital assets	9,883,413	
Restricted for:		
Debt service	261,326	
Capital projects	1,258,532	
Unrestricted	 	163,416 	
Net position	  $	11,566,687 	

Net (Expense) Revenue and Changes in Net
 	Program Revenue	 	Position

Functions/Programs
Governmental Activities:	Charges	Operating Grants	Capital Grants for		and		and
 	Expenses 	Services 	Contributions 	Contributions		
Governmental
 	Activities	
General government	$	421,548	$	290,254	$	-	$	-		$	(131,294)	
Physical environment	211,034	145,306	-	5,135,890		5,070,162	
Interest on long-term debt	 	1,134,146 	5,520,287 	19,141 	24,194 		 	4,429,476 	
Total governmental activities	  $    1,766,728      $    5,955,847      $	19,141      $	5,160,084 		9,368,344	
	  
General Revenues: Investment income		

160	
	Miscellaneous		 	22,374 	
	Change in net position		9,390,878	
	Net position, beginning		 	2,175,809 	
	Net position - ending		  $	11,566,687 	

Assets:	

 	General	

 	Debt Service	
Capital
 	Projects	Total Governmental
 	Funds	
Cash	$	393,436	$	-	$	-	$	393,436	
Investments	-	1,621,209	153,187	1,774,396	
Prepaid expenses	64,026	-	-	64,026	
Assessments receivable	270	171,897	-	172,167	
Deposits	4,500	-	-	4,500	
Due from other funds	-	44,363	-	44,363	
Due from developer	 	- 	 	- 	 	1,258,464 	 	1,258,464 	
Total assets	  $	462,232 	  $	1,837,469 	  $	1,411,651 	  $	3,711,352 	

Liabilities and Fund Balances:
Liabilities:
Accounts payable and accrued expenses	$	254,453	$	-	$	1,821,014	$	2,075,467	
Retainage payable	-	-	462,592	462,592	
Due to other funds	 	44,363 	 	- 	- 	 	44,363 	
Total liabilities	 	298,816 	 	- 	2,283,606 	 	2,582,422 	

Fund Balances:
Nonspendable	68,526	-	-
Restricted for:	68,526	
Debt service	-	1,837,469	-	1,837,469	
Unassigned	 	94,890 	- 	(871,955)	 	(777,065)	
Total fund balances	 	163,416 	1,837,469 	(871,955)	 	1,128,930 	
Total liabilities and fund balances	 $	462,232       $	1,837,469       $	1,411,651			

Amounts reported for governmental activities in the statement of net position are different because:
Capital assets used in governmental activities are not financial resources and therefore are not reported in		
the funds.	32,485,345	
Developer advances are recorded as a liability on the Statement of Net Position as Due to the Developer		
but are treated as other financing sources on the fund level statements	(77,041)	
Liabilities not due and payable from current available resources are not reported in governmental fund		
statements. All liabilities, both current and long-term, are reported in the government-wide statements.		
Accrued interest payable	(426,575)		
Bonds payable	 	(21,621,013)	 	(22,047,588)	
Net position of governmental activities	  $ 11,489,646 	

Revenues:	

 	General	

   Debt Service 	
Capital
 	Projects	Total Governmental
 	Funds	
Developer contributions	$	-	$	-	$	5,135,890	$	5,135,890	
Assessments	435,560	1,515,362	-	1,950,922	
Prepayment revenue	-	4,004,925	-	4,004,925	
Investment and other income	 	1,336 	 	19,141 	 	45,392 	 	65,869 	

Total revenues	 	436,896 	5,539,428 	5,181,282 	11,157,606 
Expenditures:

General government	135,148	-	286,400	421,548	
Maintenance and operations	211,034	-	-	211,034	
Interest	-	1,080,651	-	1,080,651	
Principal	-	4,520,000	-	4,520,000	
Capital Outlay	 	- 	 	- 	 	12,944,439 	 	12,944,439 	

Current:

Debt Service:

Total expenditures	 	346,182 	5,600,651 	13,230,839 	19,177,672 

Excess (deficit) of revenues over
expenditures	90,714	(61,223)	(8,049,557)	(8,020,066)

Other Financing Sources (Uses):
Bonds issued	-	415,892	4,834,108	5,250,000	
Transfers out	(152)	-	(13,750)	(13,902)	
Transfers in	 	- 	 	13,902 	 	- 	 	13,902 	
Total other financing sources (uses)	 	(152)	 	429,794 	 	4,820,358 	 	5,250,000 	
Net change in fund balance	90,562	368,571	(3,229,199)	(2,770,066)	
Fund balances, beginning of year	 	72,854 	 	1,468,898 	 	2,357,244 	 	3,898,996 	
Fund balances, end of year	  $	163,416 	  $	1,837,469 	  $	(871,955)	  $	1,128,930 	

Amounts reported for Governmental Activities in the Statement of Activities are different because:

Net change in fund balances - total governmental funds	

$	(2,770,066)	

Governmental Funds report outlays for Capital Assets as expenditures because such outlays use current		
financial resources; however, in the statement of net position the cost of those assets is recorded as capital		
assets.	12,944,439	
Proceeds from issuance of bonds are reported as fund sources in governmental funds and an increase to		
long-term liabilities in the statement of net position.	(5,250,000)	
Repayments of long-term liabilities are reported as expenditures in governmental funds, while repayments reduce long-term liabilities in the statement of net position.	
4,520,000	
Some expenses reported in the statement of activities do not require the use of current financial resources		
and, therefore, are not reported as expenditures in governmental funds.		
Change in accrued interest	(52,774)
Amortization of bond discount	 	(721)	
 	(53,495)	
Change in net position of governmental activities	  $	9,390,878 	

Revenues:

 	Budgeted Amounts	
 	Original	 	Final

Actual
 	Amounts

Variance with Final Budget
Positive
 	(Negative)

Assessments

$	430,950	$

430,950	$

435,560	$

4,610

Investment and other income	 	- 	- 	1,336 	1,336 
Total revenues	 	430,950 	430,950 	436,896 	5,946 
Expenditures:
Current:
General government	126,350	126,350	135,148	(8,798)	
Maintenance and operations	 	304,600 	 	304,600 	 	211,034 	 	93,566 	
Total expenditures	 	430,950 	430,950 	346,182 	84,768 
Excess (Deficit) of Revenues Over
Expenditures	 	- 	- 	90,714 	90,714 
Other Financing Sources (Uses):
Transfers out		 		- 		- 		(152)		 		(152) Total other financing sources (uses)	 		- 		- 		(152)	 		(152) Net change in fund balance				-		-	90,562			90,562
Fund balance, beginning	 	72,854 	 	72,854 	 	72,854 	 	- 	
Fund balance, ending	  $	72,854 	  $	72,854 	  $	163,416 	  $	90,562 	

NOTES TO FINANCIAL STATEMENTS

NOTE 1	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Reporting Entity
The Towne Park Community Development District, (the “District”) was established on November 3, 2014 by the City of Lakeland, Florida Ordinance No. 5476, pursuant to the Uniform Community Development District Act of 1980, otherwise known as Chapter 190, Florida Statutes. The Act provides, among other things, the power to manage basic services for community development, the power to borrow money and issue bonds, and the power to levy and collect non-ad valorem assessments for the financing and delivery of capital infrastructure. The District was established for the purpose of financing and managing the acquisition, construction, maintenance and operation of a portion of the infrastructure necessary for community development within the District.

The District is governed by the Board of Supervisors (the “Board”), which is composed of five members. The Supervisors are elected on an at large basis by owners of the property within the District. The Board of Supervisors of the District exercises all powers granted to the District pursuant to Chapter 190, Florida Statutes. At September 30, 2020, all board members were affiliated with the TP II, LLC (“the Developer”).

The Board has the final responsibility for, among other things:

Allocating and levying assessments.
Approving budgets.
Exercising control over facilities and properties.
Controlling the use of funds generated by the District.
Approving the hiring and firing of key personnel.
Financing improvements.

The financial statements were prepared in accordance with Governmental Accounting Standards Board (“GASB”) Statements 14, 39 and 61. Under the provisions of those standards, the financial reporting entity consists of the primary government, organizations for which the District Board of Supervisors is considered to be financially accountable, and other organizations for which the nature and significance of their relationship with the District are such that, if excluded, the financial statements of the District would be considered incomplete or misleading. There are no entities considered to be component units of the District; therefore, the financial statements include only the operations of the District.

Government-Wide and Fund Financial Statements
The financial statements include both government-wide and fund financial statements.

The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the non-fiduciary activities of the primary government. For the most part, the effect of interfund activity has been removed from these statements.

The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers who purchase, use, or directly benefit from goods, services or privileges provided by a given function or segment and 2) grants, contributions and investment income that are restricted to meeting the operational or capital requirements of a particular function or segment and 3) operating-type special assessments that are treated as charges for services (including assessments for maintenance and debt service). Other items not included among program revenues are reported instead as general revenues.

Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Assessments are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenues as soon as all eligibility requirements imposed by the provider have been met.

NOTE 1	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are  considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the District considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures are recorded when a liability is incurred, as under accrual accounting; however, debt service expenditures are recorded only when payment is due.

Assessments, including debt service assessments and operation and maintenance assessments, are non-ad valorem assessments imposed on all lands located within the District and benefited by the District’s activities. Operation and maintenance assessments are levied by the District prior to the start of the fiscal year which begins October 1st and ends on September 30th. These assessments are imposed upon all benefited lands located in the District. Debt service special assessments are imposed upon certain lots and lands as described in each resolution imposing the special assessment for each series of bonds issued by the District.

Assessments and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the District.

The District reports the following major governmental funds:

General Fund
Is the District’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund.

Debt Service Fund
Is used to account for the accumulation of resources for the annual payment of principal and interest on long-term debt.

Capital Projects Fund
Accounts for the financial resources to be used for the acquisition or construction of major infrastructure within the District.

As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. When both restricted and unrestricted resources are available for use, it is the District’s policy to use restricted resources first, then unrestricted resources as they are needed.

Assets, Liabilities, Deferred Outflows/Inflows of Resources and Net Position/Fund Balance
Restricted Assets
These assets represent cash and investments set aside pursuant to bond covenants.

Deposits and Investments
The District’s cash and cash equivalents are considered to be cash on hand and demand deposits.

Investments of the District are reported at fair value and are categorized within the fair value hierarchy established in accordance with GASB Statement No. 72, Fair Value Measurement and Application.

Prepaid Items
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements.

NOTE 1	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Capital Assets
Capital assets, which include property, plant, equipment and infrastructure assets (e.g., utilities system, stormwater system, landscaping and similar items), are reported in the applicable governmental activities column in the government-wide financial statements. Capital assets are defined by the government as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of two years. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value at the date of donation.

The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. All capital asset acquisition and construction is considered infrastructure under construction at September 30, 2020.

Long Term Obligations
In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the statement of net position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the straight-line method. Bonds payable are reported net of premiums or discounts. Due to developer amounts represent developer advances that are expected to be repaid upon the issuance of long-term bonds.

In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as expenditures.

Deferred Outflows/Inflows of Resources
In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The District does not have any item that qualifies for reporting in this category for the year ended September 30, 2020.

In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The District does not have any item that qualifies for reporting in this category for the year ended September 30, 2020.

Net Position Flow Assumption
Sometimes the District will fund outlays for a particular purpose from both restricted and unrestricted resources. In order to calculate the amounts to report as restricted net position and unrestricted net position in the government-wide financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. It is the District’s policy to consider restricted net position to have been depleted before unrestricted net position is applied.

Fund Balance Flow Assumption
Sometimes the District will fund outlays for a particular purpose from both restricted and unrestricted resources (total of committed, assigned, and unassigned fund balance). In order to calculate the amounts to report as restricted, committed, assigned and unassigned fund balance in the governmental fund financial statements a flow assumption must be made about the order in which the resources are considered to be applied. It is the District’s policy to consider restricted fund balance to have been depleted before using any of the components of unrestricted fund balance. Further, when the components of unrestricted fund balance can be used for the same purpose, committed fund balance is depleted first, followed by assigned fund balance. Unassigned fund balance is applied last.

Fund Balance Policies
Fund balance of governmental funds is reported in various categories based on the nature of any imitations requiring the use of resources for specific purposes. The District itself can establish limitations on the use of resources through either commitment (committed fund balance) or an assignment (assigned fund balance).

NOTE 1	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

The committed fund balance classification includes fund balance amounts that can be used only for the specific purposes determined by a formal action of the government’s highest level of decision-making authority. The Board of Supervisors is the highest level of decision-making authority for the government that can, by adoption of an ordinance or resolution prior to the end of the fiscal year, commit fund balance. Once adopted, the limitation imposed by the ordinance or resolution remains in place until a similar action is taken to remove or revise the limitation.

Amounts in the assigned fund balance classification are intended to be used by the government for specific purposes but do not meet the criteria to be classified as committed. The Board of Supervisors has authorized the District Manager to assign amounts for specific purposes. The Board of Supervisors may also assign fund balance as it does when appropriating fund balance to cover a gap between estimated revenue and appropriations in the subsequent year’s appropriated budget. Unlike commitments, assignments generally only exist temporarily. In other words, an additional action does not normally have to be taken for the removal of an assignment. Conversely, as discussed above an additional action is essential to either remove or revise a commitment.

Other Disclosures
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenditures during the reporting period. Actual results could differ from those estimates.

New Accounting Standards
In fiscal year 2020, the District implemented Government Accounting Standards Board (GASB) Statement No. 95, Postponement of the Effective Dates of Certain Authoritative Guidance. This statement provides temporary relief to governments and other stakeholders in light of the COVID-19 pandemic by postponing the effective dates of provisions in certain other statements. There was no effect on beginning balances of the District for implementation of this Statement.

NOTE 2	STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY

Budgetary Information
The District is required to establish a budgetary system and an approved annual budget for the General Fund. Annual budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. All annual appropriations lapse at the fiscal year end. The legal level of budgetary control is at the fund level. Any budget amendments that increase the aggregate budgeted appropriations, at the fund level, must be approved by the Board of Supervisors.

The District follows these procedures in establishing the budgetary data reflected in the financial statements.

Each year the District Manager submits to the District Board proposed budgets for the fiscal year commencing the following October 1.
A public hearing is conducted to obtain public comments.
Prior to October 1, the budget is legally adopted by the District Board.
Subject to certain limited exceptions set forth in the District’s appropriation resolutions adopted each year, all budget
changes must be approved by the District Board.
The budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America.

NOTE 3	DEPOSITS AND INVESTMENTS

Deposits
The District’s cash balances were entirely covered by federal depository insurance or by a collateral pool pledged to the State Treasurer. Florida Statutes Chapter 280, “Florida Security for Public Deposits Act”, requires all qualified depositories to deposit with the Treasurer or another banking institution eligible collateral equal to various percentages of the average daily balance for each month of all public deposits in excess of any applicable deposit insurance held. The percentage of eligible collateral (generally, U.S. Governmental and agency securities, state or local government debt, or corporate bonds) to public deposits is dependent upon the depository’s financial history and its compliance with Chapter 280. In the event of a failure of a qualified public depository, the remaining public depositories would be responsible for covering any resulting losses.

Investments
The District categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The fair value is the price that would be received to sell an asset, or paid to transfer a liability, in an orderly  transaction between market participants at the measurement date. The hierarchy is based on the valuation inputs used to measure the fair value of the asset.

Under GASB 72, assets or liabilities are classified into one of three levels. Level 1 is the most reliable and is based on quoted price for identical assets, or liabilities, in an active market. Level 2 uses significant other observable inputs when obtaining  quoted prices for identical or similar assets, or liabilities, in markets that are not active. Level 3 is the least reliable, and uses significant unobservable inputs that uses the best information available under the circumstances, which includes the District’s own data in measuring unobservable inputs.

The District has the following recurring fair value measurements as of September 30, 2020:

First American Government Obligation fund of $1,584,486 are valued using Level 2 inputs.

Instead of establishing a written investment policy, the District elected to limit investments to those approved by Florida Statutes and the District Trust Indenture. Authorized District investments include, but are not limited to:

The State Board of Administration Local Government Investment Pool (SBA);
Securities and Exchange Commission Registered Money Market Funds with the highest credit quality rating from a nationally recognized rating agency;
Interest-bearing savings accounts and certificates of deposit in state-certified qualified public depositories;
Direct obligations of the U.S. Treasury.

Investments made by the District at September 30, 2020 are summarized below:

 Investment Type		 	Fair Value

Credit
 	Rating

Weighted Average
 	Maturity

First American Government Obligation Fund, Class Y	$	1,584,466	AAAm	44 Days	
U.S. Bank Money Market	 	189,930 	N/A	N/A	

Total	 $	1,774,396 

Credit Risk
For investments, credit risk is generally the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. Investments in U.S. Government securities and agencies must be backed by the full faith and credit of the United States Government. Short term bond funds shall be rated by a nationally recognized ratings agency and shall maintain the highest credit quality rating. Investment ratings by investment type are included in the preceding summary of investments.

NOTE 3	DEPOSITS AND INVESTMENTS (CONTINUED)

Custodial Credit Risk
In the case of deposits, this is the risk that, in the event of a bank failure, the District’s deposits may not be returned to it. The District’s investment policy requires that bank deposits be secured as provided by Chapter 280, Florida Statutes. This law requires local governments to deposit funds only in financial institutions designated as qualified public depositories by the Chief Financial Officer of the State of Florida, and creates the Public Deposits Trust Fund, a multiple financial institution pool with the ability to assess its member financial institutions for collateral shortfalls if a default or insolvency has occurred. At September 30, 2020, all of the District’s bank deposits were in qualified public depositories.

For an investment, this is the risk that, in the event of the failure of the counterparty, the government will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. At September 30, 2020, none  of the investments listed are exposed to custodial credit risk because their existence is not evidenced by securities that exist in physical or book entry form.

Concentration of Credit Risk
The District’s investment policy does not specify limits on the amount the District may invest in any one issuer.

Interest Rate Risk
The District’s investment policy does not specifically address interest rate risk; however, the general investment policy is to apply the prudent-person rule: Investments are made as a prudent person would be expected to act, with discretion and intelligence, to seek reasonable income, preserve capital, and in general, avoid speculative investments. The District manages its exposure to declines in fair values by investing primarily in pooled investments that have a weighted average maturity of less than three months.

NOTE 4	CAPITAL ASSETS

Capital asset activity for the year ended September 30, 2020 was as follows:

Governmental Activities:
Capital assets, not being depreciated:

Beginning
 	Balance 	Additions 	Disposals

Ending
 	Balance

Construction in progress	   $  19,540,906       $ 12,944,439      $	- $ 32,485,345 	
Total capital assets, not being depreciated	 	19,540,906 	12,944,439 	- 	32,485,345 	
Governmental activities capital assets, net	  $   19,540,906      $  12,944,439      $	- $ 32,485,345 	

The total projected cost of the infrastructure has been estimated at approximately, $21.2 million, of which approximately $16.3 million was expected to be financed with the proceeds from the 2016, 2018 and 2019 Bond Series with the remainder to be funded by the Developer. The infrastructure will include storm water management, water and sewer facilities, roadways, landscaping and hardscaping and amenities. Upon completion, certain assets will be conveyed to other entities for ownership and/or maintenance.

NOTE 5	LONG-TERM LIABILITIES

Series 2016 Special Assessment Bonds - Public Offering
On June 13, 2016, the District issued $2,960,000 of Special Assessment Bonds, Series 2016 consisting of $675,000 Term Bonds due on November 1, 2028 with a fixed interest rate of 5.00%, and $2,285,000 Term Bonds due on November 1, 2046 with a fixed interest rate of 5.75%. The Bonds were issued to finance the acquisition and construction of certain improvements for the benefit of the District. Interest is paid semiannually on each May 1 and November 1. Principal is paid serially commencing on November 1, 2017 through November 1, 2046.

NOTE 5	LONG-TERM LIABILITIES (CONTINUED)

As of September 30, 2020, total principal and interest remaining on the Series 2016 Special Assessment Bonds was $2,904,301. For the fiscal year ended September 30, 2020, principal and interest paid was $109,937 and $117,732 of special assessment revenue pledged.

Series 2018 Special Assessment Bonds - Public Offering
On June 8, 2018, the District issued $13,835,000 of Special Assessment Bonds, Series 2018 consisting of $3,365,000 2018 Term Bonds due on May 1, 2049 with interest rates ranging from 4.00% to 5.50% and $10,470,000 of 2018 Term Bonds due on May 1, 2049 with interest rates ranging from 4.00% to 5.50%. The Bonds were issued to finance the acquisition and construction of certain improvements for the benefit of the District. Interest is paid semiannually on each May 1 and November 1. Principal is paid serially commencing on May 1, 2020 through May 1, 2049.

As of September 30, 2020, total principal and interest remaining on the Series 2018 Special Assessment Bonds was $18,681,491. For the fiscal year ended September 30, 2020, principal and interest paid was $5,224,279 and $5,130,814 of special assessment revenue pledged.

Series 2019 Special Assessment Bonds - Public Offering
On July 22, 2019, the District issued $5,485,000 of Special Assessment Bonds, Series 2019 with interest rates ranging from 3.50% to 6.625%. The Bonds were issued to finance the acquisition and construction of certain improvements for the benefit of the District. Interest is paid semiannually on each May 1 and November 1. Principal is paid serially commencing on May 1, 2021 through May 1, 2050.

As of September 30, 2020, total principal and interest remaining on the Series 2019 Special Assessment Bonds was $10,119,721. For the fiscal year ended September 30, 2020, no principal was due, interest paid was $173,363 and $158,522 of special assessment revenue pledged.

Series 2019 Special Assessment Bonds - Public Offering
On November 13, 2019, the District issued $5,250,000 of Special Assessment Bonds, Series 2019, Area 3C with interest rates ranging from 3.625% to 4.625%. The Bonds were issued to finance the acquisition and construction of certain improvements for the benefit of the District. Interest is paid semiannually on each May 1 and November 1. Principal is paid serially commencing on May 1, 2021 through May 1, 2050.

As of September 30, 2020, total principal and interest remaining on the Series 2019 Special Assessment Bonds was $9,698,503. For the fiscal year ended September 30, 2020, no principal was due, interest paid was $93,772 and $113,219 of special assessment revenue pledged.

The Bond Indentures have certain restrictions and requirements relating principally to the use of proceeds to pay for infrastructure improvements and the procedure to be followed by the District on assessments to property owners. The District agreed to levy special assessments in annual amounts adequate to provide payment of debt service and to meet the debt service reserve requirement. The District is in compliance with the requirements of the Bond Indentures.

The Bond Indentures require that the District maintain adequate funds in the reserve accounts to meet the debt service reserve requirements as defined in the Indentures. The requirements have been met for the fiscal year ended September 30, 2020.

NOTE 5	LONG-TERM LIABILITIES (CONTINUED)

Long-term liability activity for the year ended September 30, 2020 was as follows:

Governmental activities:
Bonds Payable:	Beginning
 	Balance		
 	Increases	
 	Decreases	Due Within One
 Ending Balance 	Year	
Series 2016	$	1,515,000	$	-	$	(25,000)	$	1,490,000	$	30,000	
Series 2018 2B	3,365,000	-	(1,595,000)	1,770,000	25,000	
Series 2018 3A	10,470,000	-	(2,900,000)	7,570,000	115,000	
Series 2019 3B	5,485,000	-	-	5,485,000	95,000	
Series 2019 3C	-	5,250,000	-	5,250,000	90,000	
Less:					
Original issue discount	(21,749)	-	721	(21,028)	-	
Due to Developer	 	77,041 	 	- 	- 	 	77,041 	- 	

Total

  $	20,890,292     $	5,250,000     $	(4,519,279)

  $	21,621,013     $	355,000 

    

At September 30, 2020, the scheduled debt service requirements on the bonds payable were as follows:

Governmental Activities
 Year Ending September 30,		 	Principal	 	Interest	
2021	$	355,000	$	1,023,779	
2022	365,000	1,034,813	
2023	380,000	1,020,625	
2024	395,000	1,005,984	
2025	415,000	989,043	
2026-2030	2,375,000	4,648,232	
2031-2035	3,005,000	4,030,063	
2036-2040	3,840,000	3,207,181	
2041-2045	4,950,000	2,127,283	
2046-2050	 	5,485,000 	 	752,013 	
	  $	21,565,000 	  $	19,839,016 	

NOTE 6	DEVELOPER TRANSACTIONS

A significant portion of the District’s activity going forward is dependent upon the continued involvement of the Developer TP II, LLC, which currently owns the majority of the assessable property located within the District boundaries. The loss of support could potentially have a material adverse effect on the District’s operations.

During the current year, the Developer was directly assessed approximately $838,000 to the District for operations and maintenance costs and debt service expenditures. The Developer also contributed approximately $5.1 million for capital expenditures, of which approximately $1.3 million is receivable at year end. As of September 30, 2020, a total of $77,041 is due to the Developer. The due to the Developer amount is related to long-term developer advances to fund the construction of infrastructure. The advances are non- interest bearing and have no scheduled repayment terms. The activity for the year is detailed in Note 5.

NOTE 7	MANAGEMENT COMPANY

The District has contracted with a management company to perform management services, which include financial and accounting services. Certain employees of the management company also serve as officers (Board appointed non-voting positions)  of the District. Under the agreements, the District compensates the management company for management, accounting, financial reporting and other administrative costs.

NOTE 8	RISK MANAGEMENT

The District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; and natural disasters. These risks are covered by commercial insurance from independent third parties. The District did not file any claims under this commercial coverage during the last three years.

NOTE 9	SUBSEQUENT EVENTS

In December 2020, the District issued $7,090,000 of Special Assessment Series 2020 Bonds for the assessment area 3D infrastructure improvements. Interest rates range from 2.65% to 4.0%, and principal payments are due annually from May 1, 2022 to May 1, 2051.

COMPLIANCE SECTION

INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT
OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

To the Board of Supervisors
Towne Park Community Development District

We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities and each major fund of the Towne Park Community Development District (the “District”) as of and for the year ended September 30, 2020 and the related notes to the financial statements, which collectively comprise the District’s financial statements and have issued our report thereon dated June 25, 2021.

Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the District’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, we do not express an opinion on the effectiveness of the District’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over financial reporting that might be a material weakness or significant deficiency. Given these limitations, during our audit, we did not identify any deficiencies in internal  control over financial reporting that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the District’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, noncompliance with which could  have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Orlando, Florida June 25, 2021

MANAGEMENT LETTER

Board of Supervisors
Towne Park Community Development District

Report on the Financial Statements
We have audited the financial statements of Towne Park Community Development District, (the “District”) as of and for the fiscal
year ended September 30, 2020, and have issued our report thereon dated June 25, 2021.

Auditor’s Responsibility
We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and Chapter 10.550, Rules of the Auditor General.

Other Reporting Requirements
We have issued our Independent Auditor’s Report on Internal Control over Financial Reporting and Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards and Independent Auditor’s Report on an examination conducted in accordance with AICPA Professional Standards, AT-C Section 315, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports, which are dated June 25, 2021, should be considered in conjunction with this management letter.

Prior Audit Findings
Section 10.554(1)(i.)1., Rules of the Auditor General, require that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no such findings in the preceding annual financial audit report.

Official Title and Legal Authority
Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in this management letter, unless disclosed in the notes to the financial statements. This information has been disclosed in the notes to the financial statements.

Financial Condition and Management
Section 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, require us to apply appropriate procedures and communicate the results of our determination as to whether or not the District has met one or more of the conditions described in Section 218.503(1), Florida Statutes, and to identify the specific condition(s) met. In connection with our audit, we determined that the District did not meet any of the conditions described in Section 218.503(1), Florida Statutes.

Pursuant to Sections 10.554(1)(i)5.b. and 10.556(8), Rules of the Auditor General, we applied financial condition assessment procedures for the District. It is management’s responsibility to monitor the District’s financial condition, and our financial condition assessment was based in part on representations made by management and the review of financial information provided by same.

Section 10.554(1)(i)2., Rules of the Auditor General, requires that we communicate any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations.

Additional Matters
Section 10.554(1)(i)3., Rules of the Auditor General, requires us to communicate noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance. In connection with our audit, we did not note any such findings.

Purpose of this Letter
Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, the Board of Supervisors, and applicable management, and is not intended to be and should not be used by anyone other than these specified parties.

Orlando, Florida June 25, 2021

934 North Magnolia Avenue, Suite 100
Orlando, Florida 32803
407-843-5406
www.mcdirmitdavis.com

INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE WITH
THE REQUIREMENTS OF SECTION 218.415, FLORIDA STATUTES

Board of Supervisors
Towne Park Community Development District

We have examined Towne Park Community Development District’s (the “District”) compliance with the requirements of Section 218.415, Florida Statutes, during the year ended September 30, 2020. Management is responsible for the District’s compliance with those requirements. Our responsibility is to express an opinion on the District’s compliance based on our examination.

Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and the standards applicable to attestation engagements contained in Government Auditing Standards issued by the Comptroller General of the United States and, accordingly, included examining, on a test basis, evidence about the District’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the District’s compliance with specified requirements.

In our opinion, the District complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2020.

Orlando, Florida June 25, 2021

The trusted partner