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Comprehensive Annual Financial Report June 30, 2015 Farmington Public School District • Farmington, MI 2015 0 01 0 0 0 0 0 0 1 1 1 1 0 2015 Comprehensive Annual une 30 mington Public School District • Farming

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Page 1: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

Comprehensive Annual

Financial ReportJune 30, 2015

Farmington Public School District • Farmington, MI2015001000000111102015Comprehensive Annualp

une 30

mington Public School District • Farming

Page 2: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

Comprehensive

Annual Financial Report of Farmington Public School District

32500 Shiawassee Farmington, Michigan 48336

For the Fiscal Year Ended

June 30, 2015

Dr. George C. Heitsch Superintendent of Schools

Board of Education

Howard I. Wallach President

Terry L. Johnson

Treasurer Sheilah P. Clay Vice President

Jessica Cummings Secretary

Murray J. Kahn

Trustee David N. Turner

Trustee Terri A. Weems

Trustee

Prepared by: Mary A. Reynolds, Executive Director of Business Services

Jennifer F. Kaminski, Director of Business Julie Yelick, Supervisor of Sue Kubiak, Payroll Bookkeeper Purchasing and Business Support Services Jennifer Moe, Payroll Bookkeeper Vacant, Bookkeeper Pam Waack, Accounts Payable Bookkeeper George Jackson, Bookkeeper Cynda Nelson, Secretary Mary Barnes, Purchasing Secretary

Page 3: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

FFarmington Public School District

Contents

Introductory Section

Letter of Transmittal i-xiii

District Officials xiv

Organizational Chart xv

ASBO Certificate of Excellence in Financial Reporting xvi

Financial Section

Independent Auditor’s Report 1-3

Management’s Discussion and Analysis 4-15

Basic Financial Statements

Government-wide Financial Statements: Statement of Net Position 16 Statement of Activities 17

Fund Financial Statements: Governmental Funds: Balance Sheet 18 Reconciliation of the Balance Sheet to the Statement of Net Position 19 Statement of Revenue, Expenditures, and Changes in Fund Balances 20 Reconciliation of the Statement of Revenue, Expenditures, and

Changes in Fund Balances of Governmental Funds to the Statement of Activities 21

Proprietary Fund - Internal Service Fund: Statement of Net Position 22 Statement of Revenue, Expenses and Changes in Net Position 23 Statement of Cash Flows 24 Fiduciary Fund - Statement of Fiduciary Assets and Liabilities 25

Notes to Financial Statements 26-50

Page 4: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

FFarmington Public School District

Contents (Continued)

Required Supplemental Information

Budgetary Comparison Schedule - General Fund 51

Budgetary Comparison Schedule - Special Education Center Program Fund 52

Schedule of Proportionate Share of the Net Pension Liability Michigan Public School Employees’ Retirement System Determined as of the Plan Year Ended September 30, 2014 53

Schedule of Contributions Michigan Public School Employees’ Retirement System Determined as of the Year Ended June 30, 2015 54

Other Supplemental Information

Combining Balance Sheet - Nonmajor Governmental Funds 55

Combining Statement of Revenue, Expenditures, and Changes in Fund Balances - Nonmajor Governmental Funds 56

Budgetary Comparison Schedule - Nonmajor Special Revenue Fund 57

Budgetary Comparison Schedule - Nonmajor Debt Service Funds 58

Budgetary Comparison Schedule - Capital Projects Funds 59-60

Schedule of Bonded Indebtedness 61

Statement of Changes in Fiduciary Assets and Liabilities 62

Schedule of Fiduciary Fund Activities 63

Cash and Investments

Schedule of Cash, Cash Equivalents, and Investments 64

Capital Assets and Accumulated Depreciation

Schedule of Capital Assets and Accumulated Depreciation 65-66

Page 5: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

FFarmington Public School District

Contents (Continued)

Statistical and Other Information (Unaudited)

Statistical Section Summary 67

Financial Trend Information

Net Position by Component - Governmental Activities 68-69

Changes in Governmental Net Position 70-71

Fund Balances - Governmental Funds 72-73

Changes in Fund Balance - Governmental Funds 74-75

Revenue Capacity Information

Taxable Value and Actual Value of Taxable Property 76-77

Direct and Overlapping Property Tax Rates 78-79

Principal Property Taxpayers 80

Property Tax Levies and Collections 81

Debt Capacity Information

Ratios of Bonded Debt Outstanding 82-83

Direct and Overlapping Governmental Activities Debt 84

Legal Debt Margin 85-86

Demographic and Economic Information

Demographic and Economic Statistics 87

Principal Employers 88

Page 6: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

FFarmington Public School District

Contents (Continued)

Operating Information

Full-time Equivalent School District Employees 89-90

Operating Indicators 91

Capital Asset Information 92-93

General Information

Points of Pride 94-95

Federal Awards Supplemental Information Issued Under Separate

Cover

Page 7: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

October 20, 2015

Citizens and Board Members:

The Comprehensive Annual Financial Report of Farmington Public School District (the “School

District”) for the fiscal year ended June 30, 2015 is submitted herewith. This report was

prepared by the business department and contains all activities under the control of the Board

of Education. Responsibility for both the accuracy of the presented data and the completeness

and fairness of the presentation, including all disclosures, rests with the School District. We

believe that the data as presented is accurate in all material respects and is presented in a

manner designed to fairly set forth the financial position and results of operations of the School

District as measured by the financial activity of its various funds with all disclosures necessary to

enable the reader to gain the maximum understanding of the School District’s financial affairs.

Reporting Entity and Services

Farmington Public School District is an independent reporting entity established under the laws

of the State of Michigan and governed by an elected, seven-member Board of Education and

fully meets criteria established by the Governmental Accounting Standards Board (GASB). All

funds of the School District are included in this report. The School District does not have

component units.

The School District follows GASB Statement No. 34, a governmental reporting model. The

financial section reports separately the governmental funds and the fiduciary fund administered

by the board. In addition, the financial section includes the School District’s government-wide

financial statements.

Report Organization

The Comprehensive Annual Financial Report was prepared to meet the needs of a broad

spectrum of financial statement readers and is divided into the following major sections:

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Introductory Section

This section introduces the reader to Farmington Public School District and to this report. Included are facts about the School District, this transmittal letter, the School District’s organizational chart, and the Association of School Business Officials International Certificate of Excellence in Financial Reporting for the year ended June 30, 2014.

Financial Section

The financial section includes the independent auditor’s report on the financial statements and schedules, management’s discussion and analysis, government-wide financial statements, the fund financial statements, notes to the financial statements, and required and other supplemental information.

The management of the School District is responsible for the financial information and representations contained in the financial statements and other sections of the annual report. In preparing the financial statements, it is necessary that management make informed estimates and judgments based on currently available information of the effects of certain events and transactions.

The management’s discussion and analysis, which includes an analysis of the School District’s financial position and results of operations, government-wide financial statements, fund financial statements, and supplemental statements and schedules presented in the financial section of this report, present fairly and with full disclosure the financial position and results of the financial operation at the fund and government-wide levels in conformity with accounting principles generally accepted in the United States of America and demonstrate compliance with finance-related legal and contractual provisions. The management’s discussion and analysis provides an overview and analysis of the School District’s basic financial statements and should be read in conjunction with the financial statements.

The basis of accounting for each fund is consistent with the activities and objectives of the fund as a fiscal and accounting entity.

The supplemental statements and schedules contain a more detailed analysis of revenue and expenditures that are compared to the 2014-2015 budget for the General and Special Education Center Program Funds, as well as schedules presenting the School District’s proportionate share of net pension liability and contribution information related to the MPSERS pension plan. Other supplemental information includes the balance sheet and statement of revenue, expenditures, and changes in fund balances as well as statements and schedules containing a more detailed analysis of revenue and expenditures that are compared to the 2014-2015 budget for nonmajor governmental funds as well as the schedule of bonded indebtedness detailing interest rates and annual maturities, schedule of fiduciary fund activities, schedule of fixed assets by building, and schedule of cash, cash equivalents, and investments.

Statistical Section

Although this section contains substantial financial information, these tables differ from financial statements in that they present some nonaccounting data, compare 10 years of data, and are intended to reflect economic data, financial trends, and the fiscal capabilities of the School District.

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About Farmington Public School District

The Community

Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington Hills and the Township of West Bloomfield, all within southern Oakland County, Michigan. The School District encompasses 28 square miles with a population of approximately 84,300. All of the City of Farmington lies within the School District boundaries and the majority of the City of Farmington Hills. A small portion of West Bloomfield Township is within the School District boundaries. The School District’s 2011 median housing sale for the cities of Farmington and Farmington Hills was $97,000 and $132,000, respectively. The median household income from survey data collected by the Cities of Farmington and Farmington Hills, respectively, was estimated at $60,955 and $69,183 in 2010, the latest census data available. Due to its proximity to I-696, Northwestern Highway, Grand River, I-96, and I-275, the School District has a significant commercial and industrial tax base to support community services and provide a strong economic climate.

Many nonprofit agencies within the area, including the Farmington Call to Action, Farmington/Farmington Hills Multi-Cultural/Multi-Racial Community Council, Neighborhood House, Farmington Youth Assistance, the Commission on Children, Youth and Families, and the Farmington Hills/Farmington Community Foundation work closely with the schools and cities to improve the quality of life for Farmington residents. The School District maintains several school/community/business partnerships that enhance educational opportunities for students with the assistance of a Partnership Advisory Council.

The School District has always been a leader in instructional excellence. The attention to a strong comprehensive academic curriculum continues to be an attraction for families moving into the community.

The School District has two early childhood centers, nine K-4 elementary schools, two 5-6 upper elementary schools, two 7-8 middle schools, three 9-12 high schools, one 11-12 alternative high school, two special education centers, a community school, and several other support facilities.

The School District has developed a comprehensive curriculum in the areas of language arts, mathematics, social studies, science, art, music, physical education and health, and world languages. All classrooms have a wide-area networked computer with Internet access and telephone. Curriculum development is guided by the School District’s student learning outcomes and the State Board of Education Model Core Curriculum. The approved K-12 frameworks process guides staff through curriculum research, planning, piloting, implementation, and evaluation.

The School District’s educational program is rich in choice and offerings. Currently, students are eligible to apply to attend any school of their choice within each school’s capacity limit. The School District operates Headstart, a federally sponsored program, for eligible at-risk early childhood students.

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There is a strong core curriculum for every student, enhanced by applied technology programs, advanced placement opportunities, bilingual and special education programs, secondary alternative high school, international academy for high school students, an award-winning music program, and a full range of physical education and athletic offerings at the secondary level.

Elementary children have access to literacy and bilingual programs that support students learning art, music, and physical education. In cooperation with the Farmington YMCA, the School District provides Y-Child Care, before and after school child care at its elementary sites, and an infant care program at one of the city activity centers. Special education services are provided government-wide for infants up to age 26 years. In addition, English as a second language is provided for adult learners. A student assessment and evaluation program provides information about individual, school, and School District achievement.

The official blended enrollment for 2014/2015, including alternative and adult education students, but excluding special education center students, was 10,329 students.

Accomplishments

Farmington Forward Dynamic Planning Implementation

During the year, work continued toward developing strategies from each of the four goal areas established in the School District’s Farmington Forward Dynamic Plan as well as the specific goals identified by the superintendent. Each of the department heads that report directly to the superintendent prepared a progress report to the Board of Education in June 2015, detailing activities during the past year. Many of the accomplishments listed below are the result of Farmington Forward goals and plans.

Student and Staff Recognition

The School District is proud of the many achievements recognized during the 2015 fiscal year. A summarized list of these recognitions is included in the statistical section.

School/Community Relations Services

Media relations and communications have been enhanced with news releases to the local papers, the Detroit dailies, the use of TV stations, TV10, social media (Facebook and Twitter), the use of List Servs, the Update Newsletter, @Farmington, community presentations, email messages, videos, and the Senior Adult Forum Breakfast.

The School District is encouraging all schools to be part of the PTA network. This network provides for strong advocacy and support for students in the School District.

Information regarding the May 2015 bond election was produced and disseminated using School District communication vehicles.

A formal customer satisfaction survey was completed. This survey, in conjunction with the Superintendent’s Listening and Learning sessions, will help the district make decisions for the future of Farmington Public School District.

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Instructional Services

Board reports will include Farmington Forward reports that “Focus on Results.” This is designed to provide an overview of instructional initiatives and the achievement of our students, including sub groups.

The School District reorganized the development of the District Improvement Plan (DIP) by ensuring School Improvement Plans (SIP) are completed by the end of May to ensure they informed the DIP as well as professional development for the 2015-2016 school year.

In November, the School District selected a six-period, semester model for our High School schedule. An implementation plan was developed and included intentional engagement of a diverse population of secondary educators. Work groups were created for milestone implementation tasks including: development of new graduation requirements, revision of all courses and course materials to match the new model, development of a student scheduling process to match the extended timeline, examination of potential learning extension, and/or support models.

Special education continued to support, align, and integrate special education instructional goals with the general education curriculum and worked to develop a model to facilitate the transition for special education students between levels and programs within the School District.

The School District continues its work in meeting state requirements for the Teacher and Administrator Evaluation System. The School District implemented its Teacher Professional Growth and Evaluation model using the final ratings to inform the 2015-2016 staffing process. The teacher model is being refined through professional development and experience with all components. The design of the administrative evaluation model is in the early phase of implementation design and select components were implemented this year (Quality Instruction Leadership, Professional Responsibilities, Relevant Training, and Aggregate Student Growth).

Technology is infused throughout the organization. It supports operations, curriculum, and instruction, enhances learning, and extends beyond the school faculty and school day. Support includes the new M-Step testing as well as the addition of Google Apps for Education.

The work of the Education Technology Advisory Committee (EdTAC) continued. Technology advancements include expanded wireless connectivity throughout the School District, iPad/iPod/chromebook pilot programs, interactive projectors, and interactive whiteboards.

Response to Instruction (RTI) is addressed through initiatives including Level Literacy Interventions (LLI), professional development, implementation of Reader’s and Writer’s Workshop, Instructional Consultation Teams (ICT) at the elementary level, and the development of the Unified Support Team (UST) model.

Implementation of Positive Behavior Intervention Support (PBIS) and on-going monitoring of discipline data continues in each school.

Professional Learning Teams (PLTs) are established in all schools and departments. Support for the work of PLTs is provided through professional development for all staff. Teacher teams are meeting on a regular basis to review what students must know and be able to do, analyze and use assessment data to inform instruction and progress, and to identify supports for assisting

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students to improve learning. Instructional support teams (Business Services, Facilities, etc.) are working on effective and efficient practices within their areas of service.

Facilities

The School District continues its work on energy management. The program initiated 10 years ago has saved over $11.6 million since its inception.

All operational departments continue to practice and investigate sustainable measures, including recycling, energy management, and industrial storm water management for future generations.

Sixteen schools received Michigan Green School Awards, nine of which were recognized as Evergreen, the highest level in the program.

The School District continued a capital improvement planning effort. The Capital Planning Advisory Committee (CPAC) was formed with a charge of reviewing earlier bond proposals as well as updated information, evaluate needs and priorities and provide a recommendation to the Board of Education which included a critical need spending plan, along with an appropriate funding source and ballot timing. A recommendation was brought to the Board in July 2014 and the successful ballot proposal was put before voters in May 2015.

Work continues with a four-person citizen’s oversight committee to monitor progress on bond work.

The facilities department worked with a Building and Site Utilization Committee (BSUC) to determine the use of District facilities and the “best space” to be utilized by students and adults. A recommendation to the Board regarding facilities to be closed and/or repurposed is expected in November 2015.

The facilities department worked with a property consultant to initiate the sale of vacant parcels. Two school sites were sold (Flanders and Wooddale) for approximately $1 million. These sales will bring approximately 50 new homes into the community. The sale of the Flanders site was completed in 2015 with the Wooddale sale anticipated to be completed in 2016.

Business Services

Financial and budget reports are prepared in accordance with standards of the Association of School Business Officials International criteria and the School District was recognized by each of the respective programs.

Transparency information continues to be updated on the School District’s website providing public access to how the School District spends its tax dollars.

Farmington Schools provides the management of the nutrition services program in the Redford Union School District through a cooperative agreement.

Nutrition Services prepares and serves over 640,000 lunches and 140,000 breakfasts daily.

GASB 68 and 71 requirements were completed for inclusion in the June 30, 2015 financial statements. GASB 68 and 71 require the net pension liability and related deferred inflows/outflows of the MPSERS pension plan be recognized on the Statement of Net Position

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(i.e. government-wide statement) as well as revised disclosures for the Farmington portion of the MPSERS pension obligation.

Successful sale of the first series of the 2015 bonds also included a refunding of the 2005 bonds.

A financial scorecard for benchmarking data was utilized as well as an operational needs assessment was completed.

Budget and Financial Report Awards

The School District has received the Association of School Business International Officials International Meritorious Budget award since 1997-1998 for its budget reports and the Certificate of Excellence in Financial Reporting since the 1996-1997 fiscal year for its financial reports.

Economic Outlook

As the School District completes its 21st year under Proposal A, approved by Michigan voters in 1994, revenue has not kept pace with inflation. Proposal A substantially shifted funding responsibility from the local level to the state level and from property tax as the major revenue source. The School District is dependent upon the state legislature for not only the majority of its funds, but also its funding level. In addition, various costs were shifted to local districts, which historically had been paid by the State. These include contributions to the Michigan Public School Employees’ Retirement System and FICA.

During fiscal year 2013, pension legislation was enacted that froze a portion of the contribution level paid directly by schools. Any unmet portion of the UAAL (unfunded actuarial accrued liability) would then be made up by the School Aid Fund, not the school districts. Payments to the Michigan Public Schools Employees’ Retirement System for all liabilities are required of school districts, but the State reimburses the School District through the mechanism of the monthly status payments. The flaw in this mechanism means that if there is not enough money to pay this section of the School Aid Act, the School District would still be responsible for these payments to fund the retirement obligations. The State could cut this or other funding based upon annual budget recommendations. The State has also used these contributions in its definition of increased funding to school districts, which does not give the complete picture of funding that supports classroom and district operations.

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The cumulative rate of per-pupil revenue increase has been about 16.2 percent since 1994, and the cumulative rate of inflation more than 47.0 percent, illustrating that funding has not kept pace with the rate of inflation. The budget in 2015-2016 was created based upon the legislature’s approval of $70 per pupil; however, due to reduction of one-time categoricals, the District’s net increase is only $25 per pupil. The School District is once again in the position to work diligently in the budget process to reduce costs, increase revenue, and create additional efficiencies to offset our increasing costs. Our collective bargaining process over the last few years with our largest groups resulted in frozen steps and other concessionary adjustments including benefit contributions of between 20 percent and 30 percent of healthcare-related expenses. Year three of the contract for teaching staff provided for half-step movement on the step schedule up to $1,500 as well as a one-time payment of $1,100 for teachers at the top of the pay scale if the General Fund fund balance exceeded 12 percent at June 30, 2014. As the fund balance at June 30, 2014 was calculated at 8.3 percent, these payments will not be required.

Michigan continues to lag behind the recovery of the national economy and the additional property foreclosures, loss of industry, business, jobs, inadequate road funding and expanded charter and cyber school options, as well as funding P-20, will have an effect on the funding available to schools. At this time, our revenue base is on a slippery slope without funding reform measures. The Governor is in the process of requesting an RFP for An Adequacy of Education Funding in Michigan study with results due by March 31, 2016. Hopefully the complexities of school funding will not stall this initiative. We believe collaboration and consolidation, of which the Governor is a big proponent, are critical funding components, but only when they make sense and can truly save money to operate schools, not just for the sake of saying that it was accomplished.

Although the School District has a fund balance at the present time, the future requires that the School District continue to develop a long-term set of strategies to ensure it is able to maintain a balanced budget in the future. The board policy requiring a targeted fund balance range of 8 percent to 12 percent of expenditures along with cost containment strategies, constant program review, and new programs to remain dynamic has the commitment of the board and administration. Farmington Forward’s goal of creating a proactive budget model will aid the School District toward maintaining financial stability while we review the process with which we allocate our expenditures. The challenge will come with living into the model and aligning “unstable” resources with program needs. The School District’s hold-harmless millage was overwhelmingly renewed by voters in August 2010, which will ensure continued levels of local operating revenue through 2015. The School District currently has a ballot proposal that will go before voters in November of 2015 that will renew this operating millage for 10 years.

Another challenge the School District faces is declining enrollment. A third-party demographer projects our enrollment annually. Due to the declines in enrollment experienced over the last several years, the School District computed a five-year average decline of 265 pupils for budget purposes. For the 2015-2016 fiscal year, the major factor affecting enrollment is the declining birthrates in Oakland County. Further declines over the next three years are also projected using the demographer data, bringing total pupils down to 9,668.

A bond issue approved by voters in 1997 provided many needed additions and upgrades to building spaces. During 2004, voters approved a bond issue to support secondary outdoor facility improvements.

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Even with these past updates to our secondary facilities, the average age of our school buildings is over 50 years. This provides a challenge in the upkeep of our buildings in the current economic conditions. The successful ballot proposal in May 2015 for $131.5 million was passed after being defeated previously in August 2013 and November 2013.

The proposal that was passed by the voters included a reduction factor which considers the work of the Building and Site Utilization Committee (BSUC) in identifying the number of educational facilities needed to support the declining student population. A preliminary report from the BSUC was provided to the Board of Education in July 2015 for review and analysis of potential building closures while awaiting a recommendation from administration on grade configurations.

Accounting System, Budgetary, and Internal Control

The board maintains a system of budgetary and accounting controls designed to assist management in meeting its responsibility for reporting reliable information. The system is designed to provide reasonable assurance that assets are safeguarded and transactions are recorded and executed with management’s authorization. Internal control systems are subject to inherent limitations with regard to the necessity to balance cost against the benefits produced. Management believes that the existing system of budgetary and accounting control provides reasonable assurance that errors or irregularities that could be material to the financial statements are prevented or would be detected within a timely period. The board utilizes a functional budget that is prepared according to the guidelines and requirements set forth in state law and the State Financial Reporting Manual.

During the fiscal year, reports are generated for the budgetary funds, which include the budget, current year-to-date revenue and expenditures, revenue and expenditures over or under, and percentage over or under budget. These reports are provided to the administration and each budget administrator has the capability to run their own reports as needed. The reports also detail the monthly transactions and summarize the remaining balances to be spent from the appropriations allocated for goods and services among the programs managed.

The report of the School District’s independent certified public accountants, Plante & Moran, PLLC, appears on pages 1-3 of this report. Their audit of the basic financial statements was performed in accordance with auditing standards generally accepted in the United States of America and Government Auditing Standards and, accordingly, included a review of the board’s system of budgetary and accounting controls.

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Cash Management

The board has a prudent cash management program that consists of expediting the receipt (direct deposit) of revenue and prudently investing available cash in bonds, bills, or notes of the United States and its agencies, certificates of deposit issued by a state or national bank, and commercial paper rated prime at the time of purchase and maturing not more than 270 days after the date of purchase. Total interest earned was $7,883 for the governmental fund types for the year ended June 30, 2015.

The School District reduces its risk on commercial paper by adopting third-party safekeeping. The School District believes that, due to the dollar amounts of cash deposits and the limits of FDIC insurance, it is impractical to insure all bank deposits. The board implemented an investment policy in accordance with GASB Statement No. 40.

Risk Management

The School District has a partial self-insurance plan for workers’ compensation claims. Under the plan, the School District’s maximum loss is limited to an amount equal to the normal workers’ compensation premiums (the School District pays the first $500,000). Losses in excess of this limitation are insured up to an aggregate limit of $5,000,000 per contract period. As of June 30, 2015, the School District has a long-term liability of approximately $722,000 recorded in the government-wide statements.

The School District is fully self-insured for medical claims. The School District estimates the liability for medical claims that have been incurred through the end of the fiscal year, including both those claims that have been reported as well as those that have not yet been reported. At June 30, 2015, the recorded obligation in the government-wide statements for these medical claims is approximately $2,683,000.

The School District is in compliance with the Right to Know legislation, including preparation of a Hazard Communication Manual, establishment of directories for all material safety data sheets, employee training, and the use of labels on all hazardous materials used by the School District.

Financial Policies

The following financial policies and practices of the School District had a significant impact on the School District’s fiscal year 2014-2015 financial statements:

Fund Balance Policy - Financial stability is important to maintain a strong instructional program for the students in the School District. In order to maintain financial stability, the Board of Education stipulates that the School District target an 8 percent to 12 percent fund balance in the General Fund. Maintaining this level of fund balance helps the School District weather sudden reductions in funding, as well as provide adequate cash flow to meet its payroll and other financial obligations.

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Preventative Maintenance Schedule and Plan - Maintaining the School District’s facilities is important to provide a safe and healthy learning environment. The School District maintains a long-range preventative maintenance and capital projects schedule in order to keep its buildings in good working order as well as to timely identify replacement of significant components within a building. In 2010, a facilities evaluation was completed by a third-party architect. This facilities evaluation has aided the School District in identifying future capital needs based upon the ages and condition of its physical plant. In May 2015, a $131.5 million bond proposal was passed by the electorate to address facilities needs and the related financing of these needs. The amount financed also includes dollars to replace a portion of our aging fleet of buses as well as technology upgrades. The bond financing amount was reduced by a factor to adjust for potential school closures due to projected declining enrollment.

Meritorious Budget Award - Annually, the School District prepares a budget document that requires historical, current, and projected financial information. The document requires each fund of the School District to have a forecast for three years beyond the upcoming fiscal year. These forecasts assist the School District in identifying financial shortfalls that will require changes either through revenue enhancements, expenditure reductions, or increased efficiencies in order to balance the budget and keep the School District in sound financial condition.

Enrollment Projections - Annually, the School District hires a third-party consultant to project student enrollment figures using live birth statistics and grade progression. This assists the School District in facilities and budget planning.

Pension and Other Postemployment Benefits - The School District participates in the Michigan Public Schools Employees’ Retirement System (MPSERS), which is a state-administered cost-sharing multiple-employer public employee retirement system. The retirement system consists of three plans: a defined benefit plan, a hybrid plan consisting of a defined benefit plan and a defined contribution plan, and a defined contribution plan. As part of the MPSERS reform approved by the Michigan Legislature and signed by the governor on September 4, 2012, all employees hired prior to July 1, 2010 were required to make an election from four options. Effective February 1, 2013, and depending on the plan selected, plan member contributions range from 0 percent up to 7.0 percent of reportable wages. Employees could elect into a defined contribution plan (DC), whereby they are not required to make additional contributions, and could also elect out of the healthcare premium subsidy and into the Personal Healthcare Fund (PHF), depending upon their date of hire and retirement plan election.

Under the MPSERS act, all retirees participating in the MPSERS pension plan have the option of continuing health, dental, and vision coverage through MPSERS. Retirees electing this coverage contribute an amount equivalent to the monthly cost for Part B Medicare and 10 percent of the monthly premium amount for the health, dental, and vision coverage at the time of receiving the benefits. The MPSERS board of trustees annually sets the employer contribution rate to fund the benefits on a pay-as-you-go basis. Participating employers are required to contribute at that rate. Effective February 1, 2013, members can choose to contribute 3 percent of their covered payroll to the Retiree Healthcare Fund and keep this premium subsidy benefit, or they can elect not to pay the 3 percent contribution and instead choose the Personal Healthcare Fund, which can be used to pay healthcare expenses in retirement. Members electing the Personal Healthcare Fund will be automatically enrolled in a 2 percent employee contribution into their 457 account as of their transition date and create a 2 percent employer match into the employee’s 401(k) account.

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Employer contribution rates are established annually by the Office of Retirement Services based upon actuarial data and estimates of future retirements in the system. A factor affecting the retirement rate computation is the number of active members for which contributions are made into the retirement system. Over the last several years, the trend in Michigan public schools is to privatize non-instructional services such as substitutes, custodians, transportation, maintenance, and food service. It has yet to be determined what effect privatization will have on future employer contribution rates.

Independent Audit

The School District’s financial statements were audited by Plante & Moran, PLLC, certified public accountants, as of June 30, 2015. Their audit was made in accordance with auditing standards generally accepted in the United States of America and Government Auditing Standards. The financial statements present fairly the financial position of Farmington Public School District at June 30, 2015. Their audit also included the single audit on federal awards, a copy of which can be obtained from the School District’s business office.

Excellence in Financial Reporting

The School District is committed to providing its citizens and other users with comprehensive financial reporting. For school districts meeting the requirements of a Comprehensive Annual Financial Report, the Association of School Business Officials International (ASBO) awards a Certificate of Excellence in Financial Reporting. The School District received a Certificate of Excellence in Financial Reporting from the ASBO for its Comprehensive Annual Financial Report for the fiscal years ended June 30, 1997 through June 30, 2014.

In order to be awarded a certificate of excellence, a governmental unit must publish an easily readable and efficiently organized Comprehensive Annual Financial Report whose contents conform to program standards. Such reports must satisfy both accounting principles generally accepted in the United States of America and applicable legal requirements.

A certificate of excellence is valid for a period of one year only. We believe our current report conforms to program standards and we are submitting our report to the ASBO to determine its eligibility for this certificate.

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xiii

Acknowledgments

The preparation of this report on a timely basis could not have been accomplished without the effort and dedicated services of the entire staff of the business department. We would like to express our appreciation to all the members of this office who assisted in the timely closing of the School District’s financial records and the preparation of this report.

Also, we would like to express our appreciation to other departments and individuals who assisted in the preparation of this report.

Sincerely,

George C. Heitsch Superintendent Mary A. Reynolds Executive Director of Business Services Jennifer F. Kaminski Director of Business

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Farmington Public School District

District Officials Administration Board of Education Dr. George C. Heitsch Howard I. Wallach Superintendent of Schools President Aaron M. Johnson Sheilah P. Clay Assistant Superintendent, Vice President Instructional Services Jonathan A. Manier Terry L. Johnson Executive Director, K-12 Instruction Treasurer Instructional Support Services Katherine M. Smith Jessica Cummings Executive Director, HR, Performance, Secretary Talent Development Mary A. Reynolds Murray J. Kahn Executive Director, Business Services Trustee Diane Bauman David N. Turner Director, School & Community Services Trustee Michael Johnston Terri A. Weems Director, Technology Services Trustee Jon Riebe Director, Facilities Management, Operations, Transportation

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Page 22: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

Association of School Business Officials International

TThe Certificate of Excellence in Financial Reporting Award is presented to

Farmington Public School District

For Its Comprehensive Annual Financial Report (CAFR) For the Fiscal Year Ended June 30, 2014

The CAFR has been reviewed and met or exceeded

ASBO International’s Certificate of Excellence standards

Mark C. Pepera, MBA, RSBO, SFO John D. Musso, CAE, RSBA President Executive Director

xvi

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Financial Section

Page 24: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

Independent Auditor's Report

To the Board of EducationFarmington Public School District

Report on the Financial Statements

We have audited the accompanying financial statements of the governmental activities, eachmajor fund, and the aggregate remaining fund information of Farmington Public School District(the "School District"), as of and for the year ended June 30, 2015, and the related notes to thefinancial statements, which collectively comprise Farmington Public School District's basicfinancial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financialstatements in accordance with accounting principles generally accepted in the United States ofAmerica; this includes the design, implementation, and maintenance of internal control relevantto the preparation and fair presentation of financial statements that are free from materialmisstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. Weconducted our audit in accordance with auditing standards generally accepted in the UnitedStates of America and the standards applicable to financial audits contained in GovernmentAuditing Standards, issued by the Controller General of the United States. Those standardsrequire that we plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free from material misstatement.

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

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

1

Amanda.OMalley
ahills
Amanda.OMalley
Praxity
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To the Board of EducationFarmington Public School District

Opinions

In our opinion, the financial statements referred to above present fairly, in all material respects,the respective financial position of the governmental activities, each major fund, and theaggregate remaining fund information of Farmington Public School District as of June 30, 2015and the respective changes in its financial position and cash flows for the year then ended, inaccordance with accounting principles generally accepted in the United States of America.

Emphasis of Matter

As discussed in Note 1 to the basic financial statements, effective July 1, 2014, the School Districtadopted the provisions of Governmental Accounting Standards Board Statement No. 68,Accounting and Financial Reporting for Pensions, and GASB Statement No. 71, Pension Transitionfor Contributions Made Subsequent to the Measurement Date. The School District's unrestrictednet position has been restated as of July 1, 2014 as a result of this change in accounting principle.Our opinion is not modified with respect to this matter.

Other Matters

Required Supplemental Information

Accounting principles generally accepted in the United States of America require that themanagement's discussion and analysis, pension system schedules of funding progress andemployer contributions, and the budgetary comparison schedules for the General Fund andSpecial Education Center Program Fund, as identified in the table of contents, be presented tosupplement the basic financial statements. Such information, although not a part of the basicfinancial statements, is required by the Governmental Accounting Standards Board, whichconsiders it to be an essential part of financial reporting for placing the basic financial statementsin an appropriate operational, economic, or historical context. We have applied certain limitedprocedures to the required supplemental information in accordance with auditing standardsgenerally accepted in the United States of America, which consisted of inquiries of managementabout the methods of preparing the information and comparing the information for consistencywith management's responses to our inquiries, the basic financial statements, and otherknowledge we obtained during our audit of the basic financial statements. We do not express anopinion or provide any assurance on the information because the limited procedures do notprovide us with sufficient evidence to express an opinion or provide any assurance.

Other Information

Our audit was conducted for the purpose of forming opinions on the financial statements thatcollectively comprise Farmington Public School District's basic financial statements. The othersupplemental information, as identified in the table of contents, is presented for the purpose ofadditional analysis and is not a required part of the basic financial statements.

2

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To the Board of EducationFarmington Public School District

The other supplemental information, as identified in the table of contents, is the responsibility ofmanagement and was derived from and relates directly to the underlying accounting and otherrecords used to prepare the basic financial statements. Such information has been subjected tothe auditing procedures applied in the audit of the basic financial statements and certainadditional procedures, including comparing and reconciling such information directly to theunderlying accounting and other records used to prepare the basic financial statements or to thebasic financial statements themselves, and other additional procedures in accordance withauditing standards generally accepted in the United States of America. In our opinion, the othersupplemental information, as identified in the table of contents, is fairly stated in all materialrespects in relation to the basic financial statements as a whole.

The accompanying introductory section and statistical tables, as identified in the table ofcontents, have not been subjected to the auditing procedures applied in the audit of the basicfinancial statements, and accordingly, we do not express an opinion or provide any assuranceon them.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report datedOctober 20, 2015 on our consideration of Farmington Public School District's internal controlover financial reporting and on our tests of its compliance with certain provisions of laws,regulations, contracts, grant agreements, and other matters. The purpose of that report is todescribe the scope of our testing of internal control over financial reporting and compliance andthe results of that testing, and not to provide an opinion on internal control over financialreporting or on compliance. That report is an integral part of an audit performed in accordancewith Government Auditing Standards in considering Farmington Public School District's internalcontrol over financial reporting and compliance.

October 20, 2015

3

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FFarmington Public School District Management’s Discussion and Analysis

4

This section of Farmington Public School District’s (the “School District”) annual financial report presents our discussion and analysis of the School District’s financial performance during the year ended June 30, 2015. Please read it in conjunction with the School District’s financial statements, which immediately follow this section.

Using this Annual Report

This annual report consists of a series of financial statements and notes to those statements. These statements are organized so the reader can understand Farmington Public School District financially as a whole. The government-wide financial statements provide information about the activities of the whole School District, presenting both an aggregate view of the School District’s finances and a longer-term view of those finances. The fund financial statements provide the next level of detail. For governmental activities, these statements tell how services were financed in the short term as well as what remains for future spending. The fund financial statements look at the School District’s operations in more detail than the government-wide financial statements by providing information about the School District’s most significant funds - the General Fund, the Special Education Center Program Fund, and the 2015 Building & Site Fund, with all other funds presented in one column as nonmajor funds. The remaining statements consist of the Internal Service Fund statements and the statement of fiduciary assets and liabilities. The Internal Service Fund statements present financial information about benefit claim costs. The statement of changes in fiduciary assets and liabilities presents financial information about activities for which the School District acts solely as an agent for the benefit of students and parents. The School District’s financial statements contain the following elements:

Management’s Discussion and Analysis (MD&A) (Required Supplemental Information)

Financial Statements

Government-wide Financial Statements Fund Financial Statements

Notes to the Financial Statements

(Required Supplemental Information)

Budgetary Information for Certain Major Funds Schedule of Proportionate Share of the Net Pension Liability of the Michigan Public School

Employees’ Retirement System Schedule of Contributions to the Michigan Public School Employees’ Retirement System

Other Supplemental Information

In addition, the School District has added the introductory section and the statistical section to compile its Comprehensive Annual Financial Report.

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

5

Reporting the School District as a Whole - Government-wide Financial Statements

One of the most important questions asked about the School District is, “As a whole, what is the School District’s financial condition as a result of the year’s activities?” The statement of net position and the statement of activities, which appear first in the School District’s financial statements, report information on the School District as a whole and its activities in a way that helps you answer this question. We prepare these statements to include all assets and liabilities, using the accrual basis of accounting, which is similar to the accounting used by most private sector companies. All of the current year’s revenue and expenses are taken into account regardless of when cash is received or paid.

These two statements report the School District’s position - the difference between the total of assets and deferred outflows and the total of liabilities and deferred inflows, as reported in the statement of net position - as one way to measure the School District’s financial health or financial position. Over time, increases or decreases in the School District’s position - as reported in the statement of activities - are indicators of whether its financial health is improving or deteriorating. The relationship between revenue and expenses is the School District’s operating results. However, the School District’s goal is to provide services to our students, not to generate profits as commercial entities do. One must consider many other nonfinancial factors, such as the quality of the education provided and the safety of the schools, to assess the overall health of the School District.

The statement of net position and the statement of activities report the governmental activities for the School District, which encompass all of the School District’s services, including instruction, support services, community services, athletics, and nutrition services. Property taxes, unrestricted state aid (foundation allowance revenue), and state and federal grants finance most of these activities.

Reporting the School District’s Most Significant Funds - Fund Financial Statements

The School District’s fund financial statements provide detailed information about the most significant funds - not the School District as a whole. Some funds are required to be established by state law and by bond covenants. However, the School District establishes many other funds to help it control and manage money for particular purposes (the Nutrition Services Fund is an example) or to show that it is meeting legal responsibilities for using certain taxes, grants, and other money (such as bond-funded construction funds used for voter-approved capital projects).

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

6

The governmental funds of the School District use the following accounting approaches:

Governmental Funds - All of the School District’s services are reported in governmental funds. Governmental fund reporting focuses on showing how money flows into and out of funds and the balances left at year end that are available for spending. They are reported using an accounting method called modified accrual accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the operations of the School District and the services it provides. Governmental fund information helps you determine whether there are more or fewer financial resources that can be spent in the near future to finance the School District’s programs. We describe the relationship (or differences) between governmental activities (reported in the statement of net position and the statement of activities) and governmental funds in a reconciliation.

Proprietary Fund - Internal Service Fund - The purpose of the Internal Service Fund is to finance services provided to other funds on a cost-reimbursement basis. The School District maintains this fund for health, dental and vision care, life insurance coverage, and long-term disability benefits. The Proprietary Fund is reported on the same basis of accounting as the government-wide statements.

The School District as Trustee - Reporting the School District’s Fiduciary Responsibilities

The School District is the trustee, or fiduciary, for its student activity funds. All of the School District’s fiduciary activities are reported in a separate statement of fiduciary assets and liabilities. We exclude these activities from the School District’s other financial statements because the School District cannot use these assets to finance its operations. The School District is responsible for ensuring that the assets reported in these funds are used for their intended purposes.

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

7

The School District as a Whole

Recall that the statement of net position provides the perspective of the School District as a whole. Table 1 provides a summary of the School District’s net position as of June 30, 2015 and 2014:

TABLE 1

2015 2014

AssetsCurrent and other assets 115.1$ 40.0$ Capital assets 106.2 110.6

Total assets 221.3 150.6

Deferred Outflows of Resources 14.1 11.3

Total assets and deferred outflows of resources 235.4 161.9

LiabilitiesCurrent liabilities 35.9 30.7Long-term liabilities 98.7 26.2Net pension liability 221.3 235.3

Total liabilities 355.9 292.2

Deferred Inflows of Resources 16.3 -

Total liabilities and deferred inflows of resources 372.2 292.2

Net Position (Deficit) *Net investment in capital assets 82.5 80.9Restricted 3.2 3.8Unrestricted (222.5) (215.0)

Total net position (deficit) (136.8)$ (130.3)$

* June 30, 2014 unrestricted net position shown as restated

Governmental Activities

(in millions)

June 30

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

8

The above analysis focuses on the net position (see Table 1). The change in net position (see Table 2) of the School District’s governmental activities is discussed below. The School District’s net deficit was $136.8 million and $130.3 million at June 30, 2015 and 2014, respectively. Capital assets, net of related debt totaling $82.5 million, compares the original cost, less depreciation of the School District’s capital assets, to long-term debt used to finance the acquisition of those assets. Most of the debt will be repaid from voter-approved property taxes collected as the debt service comes due. Restricted net position is reported separately to show legal constraints from debt covenants and enabling legislation that limit the School District’s ability to use those net assets for day-to-day operations. The remaining amount of net assets ($222.5 million) was unrestricted.

As required by the Government Accounting Standards Board (GASB), the School District adopted GASB No. 68 and No. 71. These standards required the inclusion of the School District’s proportionate share of the Michigan Public School Employees’ Retirement Plan within the School District’s financial statements, effective July 1, 2014. The effect of the adoption was to decrease July 1, 2014 beginning net position by $224.0 million and the inclusion of the obligation, and related deferred inflows and outflows, in the June 30, 2015 financial statements. All governments participating in the retirement plan were required to adopt these new standards.

The ($222.5 million) in unrestricted net position of governmental activities represents the accumulated results of all past years’ operations less the net pension liability. The unrestricted net position balance, when positive, enables the School District to meet working capital and cash flow requirements as well as to provide for future uncertainties. The net position liability as well as operating results of the General Fund will have a significant impact on the change in unrestricted net position from year to year.

The results of this year’s operations for the School District as a whole are reported in the statement of activities, which shows the changes in net position for fiscal years ended June 30, 2015 and 2014 (see Table 2).

TABLE 2

2015 2014

RevenueProgram revenue:

Charges for services 4.5$ 4.5$ Operating grants 33.8 32.9

General revenue:Property taxes 48.0 50.1 State foundation allowance 68.7 67.5 Other 1.7 2.0

Total revenue 156.7 157.0

Governmental Activities

(in millions)

Year Ended June 30

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

9

TABLE 2 (continued)

2015 2014

Functions/Program ExpensesInstruction 95.9$ 93.4$ Support services 55.6 54.1 Nutrition services 3.7 3.6 Athletics 1.8 2.0 Community services 1.4 1.3 Interest on long-term debt 2.3 1.7 Depreciation (unallocated) 3.0 3.1

Total functions/program expenses 163.7 159.2

Decrease in Net Position Before Special Item (7.0) (2.2)

Special Item - Gain on disposal of capital assets 0.5 -

Change in Net Position (6.5) (2.2)

Net Position (Deficit) - Beginning of year (130.3) 95.9

Impact of GASB Statement No. 68 and No. 71 - (224.0)

Net Position (Deficit) - End of year (136.8)$ (130.3)$

(in millions)

Governmental Activities

Year Ended June 30

As reported in the statement of activities, the cost of all governmental activities this year was $163.7 million. Certain activities were partially funded from those who benefited from the programs ($4.5 million) or by other governments and organizations that subsidized certain programs with grants and contributions ($33.8 million). The School District paid for the remaining “public benefit” portion of governmental activities with $48.0 million in taxes, $68.7 million in state foundation allowance, and with other revenue (i.e., interest and unrestricted grants totaling $1.7 million).

The School District experienced a decrease in net position. The key reasons for this change are the net effect of the investment in capital assets offset with the current year depreciation, the payment of principal on bonded debt, and General Fund operating expenditures exceeding revenue.

As discussed above, the net cost shows the financial burden that was placed on the State and the School District’s taxpayers by each of these functions. Since property taxes for operations and unrestricted state aid constitute the vast majority of district operating revenue sources, the Board of Education and administration must annually evaluate the needs of the School District and balance those needs with state-prescribed available unrestricted resources.

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

10

The School District’s Funds

As we noted earlier, the School District uses funds to help it control and manage money for particular purposes. Looking at funds helps the reader consider whether the School District is being accountable for the resources taxpayers and others provide to it and may provide more insight into the School District’s overall financial health.

As the School District completed this year, the governmental funds reported a combined fund balance of $88.3 million, an increase of approximately $72 million from the previous year. The primary reason for the increase is the sale of the 2015 series of building and site bonds for approximately $76 million and the General Fund operating expenditures exceeding revenue by approximately $3.6 million. In the General Fund, our principal operating fund, the fund balance decreased $3.6 million to $8.4 million. Budgeted expenditures were estimated to exceed revenue by $6.0 million.

The School District has taken a long-range approach to balancing cost reductions with a responsible use of fund balance to ride the current economic tide in Michigan. Working with our collective bargaining units, the School District reached a three-year wage and benefit package with the School District’s largest bargaining unit, the teachers. The three-year agreement, which expires June 30, 2016, provides for half-step movement on the step schedule up to $1,500 as well as a one-time payment of $1,100 for teachers at the top of the pay scale in year one. Year two provides for half-step movement on the step schedule up to $1,500 as well as a one-time payment of $1,100 for teachers at the top of the pay scale if the General Fund fund balance exceeds 12 percent at June 30, 2013. Year three provides for half-step movement on the step schedule up to $1,500 as well as a one-time payment of $1,100 for teachers at the top of the pay scale if the General Fund fund balance exceeds 12 percent at June 30, 2014. As the fund balance at June 30, 2014 was calculated at 8.3 percent, these payments will not be required in the last year of the contract. Teachers will continue a 20 percent contribution toward the premium cost of health, dental, and vision insurance which began January 1, 2012. This contract includes additional time needed to effectively implement PLC/Ts.

The School District also has wage and benefit agreements with its various support units: education support personnel, custodial, maintenance and nutrition services, and transportation which expire June 30, 2016. The educational support personnel unit agreed to a reduction in vacation days for the paraprofessional staff, elimination of the positive attendance incentive, and step freezes for two years in exchange for an off-schedule payment in years one and two. The other agreements include varying wage and step freezes for the custodial, maintenance and nutrition services, and transportation units in the first year. One-time off-schedule payments will be given in year two. Year three provided for an additional off-schedule payment if the General Fund fund balance exceeded 12 percent at June 30, 2014. Since the fund balance was 8.3 percent, these payments will not be required. These groups will continue a 20 percent to 30 percent contribution toward the premium cost of health, dental, and vision insurance which began July 1, 2011.

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

11

During fiscal 2014, additional work of the Benefits Advisory Committee concluded with additional revisions to the benefit plans whereby the School District agreed to forego employee contributions for dental and vision coverage which are not part of Michigan law. We understand the challenges that will be placed before us to have a balanced budget and continue to examine further efficiencies and collaborative efforts to reduce costs.

The General Fund fund balance is available to fund costs related to school operating purposes, for future state funding shortfalls, and for working capital.

The Special Education Center Program Fund balance decreased slightly as the District began renovation of a special education building. It is intended that this renovation will deplete the remaining fund balance as the District will no longer run county special education center programs in the future. The 2015 Building and Site Fund was established to record bond proceeds and other revenue and the disbursement of invoices specifically related to the remodeling of buildings for safety and security improvements; constructing additions to, equipping, furnishing, reequipping, refurnishing and remodeling buildings, including classroom, auditorium and media center improvements; improving and developing sites, including outdoor athletic facilities, playgrounds and structures; acquiring school buses and acquiring and installing technology infrastructure and equipment. Approximately $76 million was received from bond proceeds to fund the listed projects. A total of $131.5 million was approved by voters in May 2015, with the balance of the bonds to be sold during fiscal year 2018. The other nonmajor funds include the Debt Service Funds, Maintenance/Bus Purchases Capital Projects Fund, the Technology/Other Projects Capital Projects Fund, and Nutrition Services Fund. Overall, the Debt Service Funds showed a fund balance decrease of approximately $559,000. This decrease is due mainly to the use of the remaining fund balance in the 2005 debt service fund to refinance the remaining principal outstanding. Millage rates are determined annually to ensure that the School District accumulates sufficient resources to pay annual bond issue-related debt service, and the effect of these tax tribunal decisions has been incorporated in these rates. The Debt Service Funds fund balances are restricted since they can only be used to pay debt service obligations. The Nutrition Services Fund experienced an increase in fund balance of approximately $85,000. Lunch and breakfast prices have remained unchanged and the department is addressing future capital needs.

The Maintenance/Bus Purchases Capital Projects Fund was created during the 2004-2005 fiscal year to separate large capital and nonoperating expenditures from general operations of the School District. Transfers from the General Fund are made to this fund based upon the capital projects budgeted for the fiscal year.

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

12

The Technology/Other Projects Capital Projects Fund was previously funded through transfers from the General Fund. These funds were used to purchase technology related equipment. As pressures continued on General Fund operations, limited, if any, dollars were available to fund technology purchases. Therefore a portion of the 2015 Building and Site Fund will be used to purchase technology infrastructure and technology related equipment.

General Fund Budgetary Highlights

Over the course of the year, the School District revises its budget as it attempts to deal with unexpected changes in revenue and expenditures. State law requires that the budget be amended to ensure that expenditures do not exceed appropriations. The final amendment to the budget was adopted before year end (a schedule showing the School District’s original and final budget amounts compared with amounts actually paid and received is provided in the required supplemental information of these financial statements).

There were revisions made to the revenue in the 2014-2015 General Fund original budget. The revisions, totaling a net decrease of approximately $1.4 million, consisted mainly of a net increase in state funding of approximately $.2 million to reflect additional funding for retirement obligations, coupled with a loss in state funding of approximately $1.2 million due to a larger than expected decline in pupils, a decrease in local funding of approximately $.5 million based upon revised property tax values, a decrease in the proceeds from land sales of $.5 million due to the delay of the sale of a property, a decrease of $.6 million of transfers in from other funds based upon updated program costs and funding in the Special Education Center Fund, and adjustment of grant awards.

There were revisions made to the expenditures in the 2014-2015 General Fund original budget. Budgeted expenditures were decreased by $1.0 million on a net basis due to actual staffing in place, an increase in retirement costs for the UAAL (unfunded accrued actuarial liability) costs, and adjustments of grant awards. The difference between final budgeted revenue and actual revenue was $591,071, or 0.45 percent less than budgeted. The difference, on a net basis, includes a workers compensation prior year excess claim refund recorded in local sources and actual federal revenue recorded based upon expenditures made however grants are budgeted at the full award amount. The difference between final budgeted expenditures and actual expenditures was $2,301,383, or 1.60 percent less than budgeted. The reasons for the differences, on a net basis, are as follows: Grant expenditures, budgeted upon award amounts, were below projections by

approximately $869,000.

Utility costs were below projections by approximately $146,000.

Substitute costs were above projections by approximately $433,000.

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

13

Building budgets and teacher/administrator conference accounts were below projections, with balances remaining at year end totaling approximately $371,000.

Many departmental budgets were below projections, with balances remaining at year end totaling approximately $364,000.

Employee wage and wage-related benefit costs were below projections by $407,000.

Employee fringe benefit costs were below projections by $357,000. Workers’ compensation costs were below projections by $220,000.

Other financing sources actual balances were higher than the final budget due to lower expenditures in the Special Education Center Fund, which allowed more funds to be transferred to the General Fund.

Capital Assets and Debt Administration

Capital Assets

At June 30, 2015 and 2014, the School District had $106,182,971 and $110,568,500, respectively, invested in a broad range of capital assets, including land, buildings, and furniture and equipment. This amount represents a net decrease (including additions, deductions, and depreciation) of $4,385,529 from last year.

June 30

2015 2014

Land 987,345$ 1,022,344$ Construction in progress 86,221 14,871 Buildings and building improvements 169,516,065 169,281,502 Buses and other vehicles 10,267,097 10,283,128 Furniture and equipment 11,994,189 11,799,527

Total capital assets 192,850,917 192,401,372

Less accumulated depreciation 86,667,946 81,832,872

Net capital assets 106,182,971$ 110,568,500$ This year’s additions of $429,225 included office furniture and equipment, vocation education equipment, maintenance equipment, food service equipment, playground equipment, several roof projects, and the completion of an HVAC project.

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

14

Capital additions for 2015-2016 will be significantly higher than what was expended in the 2014-2015 fiscal year as the School District was successful in May 2015 in passing building and site bonds. The first issue to be spent over the next three fiscal years totals approximately $76.0 million. We present more detailed information about our capital assets in Note 5 to the financial statements.

Debt

At the end of this year, the School District had $90,170,000 in bonds outstanding versus $28,575,000 in the previous year - an increase of 215.6 percent. Those bonds consisted of the following:

2015 2014

2005 general obligation bonds - $ 17,520,000$ 2013 general obligation bonds 9,120,000 11,055,000 2015 general obligation bonds 81,050,000 -

Total general obligation bonds 90,170,000$ 28,575,000$

During 2015, Moody’s reviewed and downgraded the School District’s credit rating from Aa2 to Aa3 with a negative outlook. The current Standard & Poor’s rating given to the School District in 2010 of AA was reviewed and reaffirmed in June 2013. The State limits the amount of general obligation debt that schools can issue to 15 percent of the assessed value of all taxable property within the school district’s boundaries. If the school district issues qualified debt, i.e., debt backed by the State of Michigan, such obligations are not subject to this debt limit. The School District’s outstanding nonqualified general obligation debt of $81.050 million is significantly below this $518.8 million statutorily imposed limit.

Other obligations include accrued vacation pay, sick leave, workers’ compensation self-insurance, and voluntary severance plan incentive obligations. We present more detailed information about our long-term liabilities in Note 7 to the basic financial statements.

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FFarmington Public School District Management’s Discussion and Analysis (Continued)

15

Economic Factors and Next Year’s Budgets and Rates

Our elected officials and administration considered many factors when setting the School District’s 2016 fiscal year budget. One of the most important factors affecting the budget is our student count. The state foundation revenue is determined by multiplying the blended student count by the foundation allowance per pupil. The blended count for the 2016 fiscal year is 90 percent and 10 percent of the October 2015 and February 2015 student counts, respectively. The 2016 budget was adopted in June 2015, based on an estimate of students that will be enrolled in September 2015. Approximately 75 percent of total General Fund revenue is from the foundation allowance. Under state law, the School District cannot assess additional property tax revenue for general operations. As a result, School District funding is heavily dependent on the State’s ability to fund local school operations. Based on early enrollment data at the start of the 2016 school year, we anticipate that the fall student count will be approximately the same as the estimates used in creating the 2015-2016 budget. Once the final student count and related per pupil funding are validated, state law requires the School District to amend the budget if actual School District resources are not sufficient to fund original appropriations. The legislature approved a $70 increase in the 2015-2016 foundation allowance; however, certain one-time categoricals were eliminated which created a net increase to the School District of only $25. The foundation allowance is approximately the same as the 2002-2003 level.

Since the School District’s revenue is heavily dependent on state funding and the health of the State’s School Aid Fund, the actual revenue received depends on the State’s ability to collect revenue to fund its appropriation to school districts. With the 2012 changes to the MPSERS pension system, the legislature also included a provision to keep the health portion charged to school districts at a flat rate and any increase would come from the School Aid Fund. The rate paid by the School District varies based upon the plan selected by the employee this past year. This puts additional pressure on the fund for the available resources to distribute to schools. The State periodically holds a revenue-estimating conference to estimate revenue. The next revenue-estimating conference has not been scheduled at the present time. The school aid budget now includes appropriations for community colleges and higher education as well. The legislature will need to make drastic budget cuts or determine alternate revenue sources should the funding sources identified fall short of projections. The governor continues to look at overhauling the current funding structure. Funding P-20 schools is a high priority for the governor which could have a drastic negative impact on current K-12 school districts and their available resources.

During 2013, the School District settled labor contracts with its unions. The financial impact of the 2013 settlements on 2015 operations resulted in an increase in costs of approximately $1.0 million; however, these settlements provide the School District with known forecasting data as well as instructional day calendars through 2016. All labor contracts expire on June 30, 2016.

Contacting the School District’s Management

This financial report is intended to provide our taxpayers, parents, and investors with a general overview of the School District’s finances and to show the School District’s accountability for the money it receives. If you have any questions about this report or need additional information, we welcome you to contact the business office.

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FFarmington Public School District

The Notes to Financial Statements are an Integral Part of this Statement. 16

Statement of Net Position June 30, 2015

Governmental

Activities

AssetsCash and investments (Note 3) 96,923,616$ Receivables:

Taxes 64,000 Accounts receivable 295,528 Due from other governmental units 16,857,593

Inventories 96,187 Deposits 270,268 Prepaid costs 624,506 Capital assets not being depreciated (Note 5) 1,073,566 Capital assets being depreciated - Less accumulated depreciation of

$86,667,946 (Note 5) 105,109,405

Total assets 221,314,669

Deferred Outflows of Resources -

Deferred outflows related to pensions (Note 9) 14,145,073

Total assets and deferred outflows of resources 235,459,742

LiabilitiesAccounts payable 1,441,772 Accrued payroll and other liabilities 17,986,989 Interest payable 466,050 Due to other governmental units 81,845 Unearned revenue (Note 4) 808,347 State aid note payable (Note 10) 4,285,714 Long-term liabilities (Note 7):

Bonds and contracts payable, due within one year 7,432,452 Compensated absences and other long-term liabilities, due within

one year 3,449,245 Bonds and contracts payable, due in more than one year 92,757,896 Compensated absences and other long-term liabilities, due in more

than one year 5,929,256 Net pension liability (Note 9) 221,281,477

Total liabilities 355,921,043

Deferred Inflows of Resources -

Deferred inflows related to pensions (Note 9) 16,296,845

Total liabilities and deferred inflows of resources 372,217,888

Net PositionNet investment in capital assets 82,595,528 Restricted for:

Special education 1,969,251 Nutrition services 1,017,712

Unrestricted (222,340,637)

Total net position (136,758,146)$

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FFarmington Public School District

The Notes to Financial Statements are an Integral Part of this Statement. 17

Statement of Activities Year Ended June 30, 2015

Program Revenue

Governmental

Activities

Expenses

Charges for

Services

Operating

Grants/

Contributions

Net (Expense)

Revenue and

Changes in Net

Position

Functions/Programs

Primary government - Governmental activities:Instruction 95,922,327$ 155,792$ 20,536,790$ (75,229,745)$ Support services 55,576,921 386,105 11,021,623 (44,169,193) Nutrition services 3,676,318 2,220,997 1,630,672 175,351 Athletics 1,799,480 651,087 - (1,148,393) Community services 1,441,845 1,135,108 582,758 276,021 Interest on long-term debt 2,313,319 - - (2,313,319) Depreciation (unallocated)* 3,012,856 - - (3,012,856)

Total primary government -Governmental activities 163,743,066$ 4,549,089$ 33,771,843$ (125,422,134)

General revenue:Taxes:

Property taxes - Levied for general purposes 40,661,043 Property taxes - Levied for debt services 7,320,043

State aid not restricted to specific purposes 68,748,701 Interest and investment earnings 7,883

Other 1,689,689

Total general revenue 118,427,359

Change in Net Position Before Special Item (6,994,775)

Special Item - Gain on disposal of capital assets 467,256

Change in Net Position (6,527,519)

Net Position - As restated - Beginning of

year (Note 1) (130,230,627)

Net Position - End of year (136,758,146)$

* Excludes direct depreciation expense of the various functions/programs

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FFarmington Public School District

The Notes to Financial Statements are an Integral Part of this Statement. 18

Governmental Funds Balance Sheet June 30, 2015

2015 Building

and Site

Assets

Cash and investments (Note 3) 14,356,706$ - $ - $ 1,176,484$ 15,533,190$ Receivables:

Taxes 62,000 - - 2,000 64,000 Accounts receivable 221,970 - 1,327 3,352 226,649 Due from other governmental units 16,773,040 - - 84,553 16,857,593

Due from other funds (Note 6) 125,343 2,167,941 - 68,854 2,362,138 Inventories 62,149 - - 34,038 96,187 Prepaid costs 598,967 - - - 598,967 Restricted assets (Note 3) - - 76,632,112 221,969 76,854,081

Total assets 32,200,175$ 2,167,941$ 76,633,439$ 1,591,250$ 112,592,805$

Liabilities, Deferred Inflows of Resources, and Fund Balances

LiabilitiesAccounts payable 722,253$ 8,304$ 22,614$ 8,597$ 761,768$ Accrued payroll 15,045,738 190,386 - 25,465 15,261,589 Other accrued liabilities 42,672 - - - 42,672 State Aid Note Payable 4,285,714 - - - 4,285,714 Due to other funds (Note 6) 2,236,795 - 7,920 103,447 2,348,162 Due to other governmental units 81,845 - - - 81,845 Unearned revenue (Note 4) 745,463 - - 62,884 808,347

Total liabilities 23,160,480 198,690 30,534 200,393 23,590,097

Deferred Inflow of Resources - Unavailable revenue (Note 4) 679,967 - - - 679,967

Total liabilities and deferred inflowof resources 23,840,447 198,690 30,534 200,393 24,270,064

Fund BalancesNonspendable:

Inventories 62,149 - - 34,038 96,187 Prepaid costs 598,967 - - - 598,967

Restricted:Special education center program - 1,969,251 - - 1,969,251 Capital projects - - 76,602,905 - 76,602,905 Nutrition services - - - 983,674 983,674 Debt service - - - 227,029 227,029

Committed:Contractual obligations - Retirement and sick pay 2,657,233 - - - 2,657,233 Contractual obligations - Vacation pay 343,284 - - - 343,284 Capital projects - - - 146,116 146,116

Assigned:Budgeted use of fund balance in 2015/2016 1,470,982 - - - 1,470,982 Voluntary severance plan pay 3,227,113 - - - 3,227,113

Unassigned - - - - -

Total fund balances 8,359,728 1,969,251 76,602,905 1,390,857 88,322,741

Total liabilities, deferred inflows of resources, and fund balances 32,200,175$ 2,167,941$ 76,633,439$ 1,591,250$ 112,592,805$

TotalGeneral Fund

Other

Nonmajor

Governmental

Special

Education

Center

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FFarmington Public School District

The Notes to Financial Statements are an Integral Part of this Statement. 19

Governmental Funds Reconciliation of the Balance Sheet

to the Statement of Net Position June 30, 2015

Fund Balances - Governmental Funds 88,322,741$

Amounts reported for governmental activities in the statementof net position are different because:

Capital assets used in governmental activities are notfinancial resources and are not reported in the funds:

Cost of capital assets 192,850,917$ Accumulated depreciation (86,667,946)

Total 106,182,971

Receivables are not available to pay current periodexpenditures and are therefore deferred in the funds 679,967

Deferred outflows related to pension paymentsmade subsequent to the measurement date 14,145,073

Long-term liabilities are not due and payable in the currentperiod and are not reported in the funds:

Bonds payable including premium (100,190,348) Voluntary severance incentive (5,080,368) Compensated absences (3,576,055) Workers' compensation self-insurance liability (722,078)

Accrued interest payable is not included as a liability in thegovernmental funds (466,050)

Internal Service Fund is included as part of the

governmental activities 1,524,323

Net pension obligations do not present a claim

on current financial resources and are not

reported as fund liabilities (221,281,477)

Deferred inflows related to pension investment

returns and changes in assumptions are not

reported in the governmental funds (16,296,845)

Net Position of Governmental Activities (136,758,146)$

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FFarmington Public School District

The Notes to Financial Statements are an Integral Part of this Statement. 20

Governmental Funds Statement of Revenue, Expenditures, and

Changes in Fund Balances Year Ended June 30, 2015

General Fund

Special

Education

Center

Program

2015 Building

and Site

Other

Nonmajor

Governmental

Funds Total

RevenueLocal sources 44,733,245$ - $ 485$ 9,521,440$ 54,255,170$ State sources 80,240,701 2,662,998 - 197,333 83,101,032 Federal sources 4,260,242 - - 1,471,139 5,731,381 Interdistrict sources 677,831 11,967,501 - 49,332 12,694,664

Total revenue 129,912,019 14,630,499 485 11,239,244 155,782,247

ExpendituresCurrent:

Instruction 87,537,549 4,497,280 - - 92,034,829 Support services 50,842,006 2,263,926 - - 53,105,932 Community services 1,424,828 - - - 1,424,828 Nutrition services - - - 3,676,318 3,676,318 Athletics 1,799,480 - - - 1,799,480

Debt service:Principal - - - 6,150,000 6,150,000 Bond issuance costs - - 462,975 74,589 537,564 Interest and other - - - 1,771,184 1,771,184

Other bond expenditures - - - - - Intergovernmental payments 136,226 297,835 - - 434,061 Capital outlay - 81,093 30,534 407,248 518,875

Total expenditures 141,740,089 7,140,134 493,509 12,079,339 161,453,071

Excess of Revenue (Under) OverExpenditures (11,828,070) 7,490,365 (493,024) (840,095) (5,670,824)

Other Financing Sources (Uses)Transfers in (Note 6) 7,862,474 - - 617,419 8,479,893 Transfers out (Note 6) (145,000) (7,571,459) - (763,434) (8,479,893)

Proceeds from sale of capital assets 502,255 - - - 502,255 Face value of debt issued - - 68,620,000 12,430,000 81,050,000 Premium on debt issued - - 8,475,929 710,853 9,186,782 Payment to bond escrow agent - - - (13,063,221) (13,063,221)

Total other financing sources (uses) 8,219,729 (7,571,459) 77,095,929 (68,383) 77,675,816

Net Change in Fund Balances (3,608,341) (81,094) 76,602,905 (908,478) 72,004,992

Fund Balances - Beginning of year 11,968,069 2,050,345 - 2,299,335 16,317,749

Fund Balances - End of year 8,359,728$ 1,969,251$ 76,602,905$ 1,390,857$ 88,322,741$

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FFarmington Public School District

The Notes to Financial Statements are an Integral Part of this Statement. 21

Governmental Funds Reconciliation of the Statement of Revenue, Expenditures,

and Changes in Fund Balances of Governmental Funds to the Statement of Activities

Year Ended June 30, 2015

Net Change in Fund Balances - Total Governmental Funds 72,004,992$

Amounts reported for governmental activities in the statementof activities are different because:

Governmental funds report capital outlays as expenditures; inthe statement of activities, these costs are allocated overtheir estimated useful lives as depreciation:

Depreciation expense (4,851,105)$ Capital outlay subject to capitalization 500,575

Total (4,350,530)

The net effect of other transactions involving capital assets (i.e.,impairments, sales, and donations) that decreased net assets (34,999)

Revenue is recorded in the statement of activities whenearned; it is not reported in the funds until collectedor collectible within 60 days of year end 283,729

Accrued interest is recorded in the statement of activities whenincurred; it is not reported in governmental funds until paid (246,350)

Accrued voluntary separation incentive payments are reported as expenditures when financial resources are used in governmental funds (4,533,368)

Proceeds from issuance of bonds are revenue in the governnmental funds,but not in the statement of activities (where it increases long-term debt) (90,236,782)

Amortization of bond premium 217,452

Repayment of bond principal is an expenditure in the governmental funds, but not in the statement of activities(where it reduces long-term debt) 19,455,000

Changes in compensated absences and other long-term liabilitiesare reported as expenditures when financial resourcesare used in the governmental funds 388,395

Change in pension expense related to deferred items 512,936

Internal Service Fund is included as part of the

governmental activities 12,006

Change in Net Position of Governmental Activities (6,527,519)$

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FFarmington Public School District

The Notes to Financial Statements are an Integral Part of this Statement. 22

Proprietary Fund - Internal Service Fund Statement of Net Position

June 30, 2015

Benefit

Stabilization

Fund

Assets - Current assetsCash (Note 3) 4,536,345$ Receivables 54,903 Deposits 270,268 Prepaids 25,539

Total assets 4,887,055

Liabilities - Current liabilitiesAccounts payable 680,004 Accrued liabilities (Note 8) 2,682,728

Total current liabilities 3,362,732

Net Position - Unrestricted 1,524,323$

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FFarmington Public School District

The Notes to Financial Statements are an Integral Part of this Statement. 23

Proprietary Fund - Internal Service Fund Statement of Revenue, Expenses, and Change in Net Position

Year Ended June 30, 2015

Benefit

Stabilization

Fund

Operating RevenuesCharges for services 19,873,769$ Other 464,207

Total operating revenues 20,337,976

Operating ExpensesCost of insurance claims 19,609,910 Premiums 716,716

Total operating expenses 20,326,626

Operating Income 11,350

Nonoperating Revenues - Interest income 656

Change in Net Position 12,006

Net Position - Beginning of year 1,512,317

Net Position - End of year 1,524,323$

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FFarmington Public School District

The Notes to Financial Statements are an Integral Part of this Statement. 24

Proprietary Fund - Internal Service Fund Statement of Cash Flows

Year Ended June 30, 2015

Benefit

Stabilization

Fund

Cash Flows from Operating ActivitiesReceipts from interfund services 19,464,964$ Claims and premiums paid (18,822,271) Other receipts 409,304

Net cash provided by operating activities 1,051,997

Cash Flows from Investing Activities - Interest 656

Net Increase in Cash 1,052,653

Cash - Beginning of year 3,483,692

Cash - End of year 4,536,345$

Reconciliation of operating income to net cash providedby operating activities: 11,350$

Adjustment to reconcile operating incometo net cash provided by operating activities -Change in assets and liabiltities:

Receivables (54,059) Deposits 103,990 Prepaids 332,287 Due from other funds 1,248,387 Accounts payable 8,711 Accrued liabilities (598,669)

Net cash provided by operating activities 1,051,997$

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FFarmington Public School District

The Notes to Financial Statements are an Integral Part of this Statement. 25

Fiduciary Fund Statement of Fiduciary Assets and Liabilities

June 30, 2015

Student Activities

Agency Fund

AssetsCash and investments (Note 3) 1,091,793$ Accounts receivable 5,726

Total assets 1,097,519$

LiabilitiesAccounts payable 81,308$ Due to other funds (Note 6) 13,976 Due to student groups 1,002,235

Total liabilities 1,097,519$

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FFarmington Public School District

Notes to Financial Statements June 30, 2015

26

Note 1 - Summary of Significant Accounting Policies

The accounting policies of Farmington Public School District (the “School District”) conform to accounting principles generally accepted in the United States of America (GAAP) as applicable to governmental units. The following is a summary of the significant accounting policies used by the School District:

Reporting Entity

The School District is governed by an elected seven-member Board of Education. The accompanying financial statements have been prepared in accordance with criteria established by the Governmental Accounting Standards Board for determining the various governmental organizations to be included in the reporting entity. These criteria include significant operational financial relationships that determine which of the governmental organizations are a part of the School District’s reporting entity, and which organizations are legally separate component units of the School District. Based on the application of the criteria, the School District does not contain any component units.

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 nonfiduciary activities of the primary government. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenue, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. All of the School District’s government-wide activities are considered governmental activities.

The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenue. Direct expenses are those that are clearly identifiable with a specific function. Program revenue includes (1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function and (2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function. Taxes, intergovernmental payments, and other items not properly included among program revenue are reported instead as general revenue.

Separate financial statements are provided for governmental funds, the proprietary fund, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds are reported as separate columns in the fund financial statements.

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Notes to Financial Statements June 30, 2015

27

Note 1 - Summary of Significant Accounting Policies (Continued)

Measurement Focus, Basis of Accounting, and Financial Statement Presentation

Government-wide Financial Statements - The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenue is recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenue in the year for which they are levied. Grants, categorical aid, and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.

As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements.

When an expense is incurred for purposes for which both restricted and unrestricted net position or fund balance are available, the School District’s policy is to first apply restricted resources. When an expense is incurred for purposes for which amounts in any of the unrestricted fund balance classifications could be used, it is the School District’s policy to spend funds in this order: committed, assigned, and unassigned.

Amounts reported as program revenue include (1) charges to customers or applicants for goods, services, or privileges provided, (2) operating grants and contributions, and (3) capital grants and contributions. Internally dedicated resources are reported as general revenue rather than as program revenue. Likewise, general revenue includes all taxes and unrestricted state aid.

Fund-based Financial Statements - Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenue is recognized as soon as it is both measurable and available. Revenue is considered to be available if it is collected within the current period or soon enough thereafter to pay liabilities of the current period. Revenue not meeting this definition is classified as a deferred inflow of resources. For this purpose, the government considers revenue to be available if it is collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due.

Property taxes, unrestricted state aid, intergovernmental grants, and interest associated with the current fiscal period are all considered to be susceptible to accrual and have been recognized as revenue of the current fiscal period. All other revenue items are considered to be available only when cash is received by the School District.

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Notes to Financial Statements June 30, 2015

28

Note 1 - Summary of Significant Accounting Policies (Continued)

Fiduciary fund statements report assets and liabilities held by the School District in a trustee capacity or as an agent. They do not involve the measurement of results of operations. Fiduciary fund statements are reported using the accrual basis of accounting.

Proprietary fund statements are also reported using the economic resources measurement focus and the accrual basis of accounting. Proprietary funds distinguish operating revenue and expenses from nonoperating items. Operating revenue and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal revenue of the proprietary fund relates to charges to other funds for benefit services. Operating expenses for the proprietary fund include the cost of health, dental and vision claims, administrative expenses, costs for life insurance, and long-term disability benefits. All revenue and expenses not meeting this definition are reported as nonoperating revenue and expenses.

The School District reports the following major governmental funds:

General Fund - The General Fund is the School District’s primary operating fund. It accounts for all financial resources of the School District, except those required to be accounted for in another fund.

Special Education Center Program Fund - The Special Education Center Program Fund is a special revenue fund that is used to record all transactions associated with special education center programs administered by the School District on behalf of the ISD. The main sources of revenue for this fund are the tuition and PA-18 funds received from the ISD and the special education funds received from the State.

2015 Building and Site Fund - The 2015 Building and Site Fund is a Capital Projects Fund used to record bond proceeds and other revenue and the disbursement of invoices specifically related to the remodeling of buildings for safety and security improvements; constructing additions to, equipping, furnishing, reequipping, refurnishing and remodeling buildings, including classroom, auditorium and media center improvements; improving and developing sites, including outdoor athletic facilities, playgrounds and structures; acquiring school buses and acquiring and installing technology infrastructure and equipment. The fund operates until the purpose for which it was created is accomplished.

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Note 1 - Summary of Significant Accounting Policies (Continued)

The School District reports the following nonmajor funds:

Nutrition Services Fund - The Nutrition Services Fund is a special revenue fund that is used to record all transactions of food sales to pupils at all School District school buildings. The main sources of revenue for this fund are food sales to pupils, free/reduced breakfast and lunch reimbursement from federal funds, and funds received from the State.

2004, 2005, 2013, and 2015 Debt Service Funds - The 2004, 2005, 2013, and 2015 Debt Service Funds are used to record tax and interest revenue and the payment of interest, principal, and other expenditures on long-term debt.

Technology/Other Projects Capital Project Fund - The Technology/Other Projects Capital Project Fund is financed by support of the General Fund and is used for the replacement and addition of computers and other related technology. The fund operates until the purpose for which it was created is accomplished.

Maintenance/Bus Purchases Fund - The Maintenance/Bus Purchases Fund is a capital projects fund that is financed by support of the General Fund and is used for purchasing buses and funding maintenance projects throughout the School District. The fund operates until the purpose for which it was created is accomplished.

Internal Service Fund - The Internal Service Fund accounts for benefit services provided to other funds of the School District on a cost-reimbursement basis.

In addition, the School District maintains an Agency Fund. The Agency Fund is used to record the transactions of student and community groups for school and school-related purposes. The funds are segregated and held in trust for the students.

Assets, Liabilities, and Net Position or Equity

Deposits and Investments - Cash and cash equivalents include cash on hand, demand deposits, and short-term investments with a maturity of three months or less when acquired. Investments are stated at fair value. Pooled investment income from each of the School District’s funds is generally allocated to each fund using a weighted average of balance for the principal.

Receivables and Payables - In general, outstanding balances between funds are reported as “due to/from other funds.” Activities between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as “advances to/from other funds.”

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Note 1 - Summary of Significant Accounting Policies (Continued)

All trade and property tax receivables are shown net of an allowance for uncollectible amounts. The School District considers all accounts receivable to be fully collectible; accordingly, no allowance for uncollectible amounts is recorded. Property taxes are levied on July 1 for taxes due August 31 and December 1 for the remainder on the taxable valuation of property as of the preceding December 31. Taxes are considered delinquent on March 1 of the following year. At this time, penalties and interest are assessed and the total obligation is added to the county tax rolls.

Inventories and Prepaid Costs - Inventories are valued at cost, on a first-in, first-out basis. Inventories of governmental funds are recorded as expenditures when consumed rather than when purchased. Certain payments to vendors reflect costs applicable to future fiscal years and are recorded as prepaid costs in both government-wide and fund financial statements. Prepaid costs of governmental funds are recorded as expenditures when consumed rather than when purchased.

Restricted Assets - The unspent bond proceeds and related interest of the 2015 Building and Site Fund require amounts to be set aside for construction. In addition, the unspent property taxes levied in the Debt Service Funds are required to be set aside for future bond principal and interest. These amounts have been classified as restricted assets.

Capital Assets - Capital assets, which include land, buildings, equipment, and vehicles, are reported in the 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 one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation. Costs of normal repair and maintenance that do not add to the value or materially extend asset life are not capitalized. The School District does not have infrastructure-type assets.

Buildings, equipment, and vehicles are depreciated using the straight-line method over the following useful lives:

Construction in progress and land are not depreciated. Construction in progress is reclassified to the appropriate category once placed in service. It is then depreciated according to the useful lives listed in the above table.

Buildings and building improvements 20-50 yearsBuses and other vehicles 5-10 yearsFurniture and equipment 5-10 years

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Note 1 - Summary of Significant Accounting Policies (Continued)

Compensated Absences - The liability for compensated absences reported in the government-wide statements consists of unpaid, accumulated annual vacation and sick leave balances. The liability has been calculated using the vesting method in accordance with the six collective bargaining agreements or employment contracts, in which leave amounts for both employees who are currently eligible to receive termination payments and other employees who are expected to become eligible in the future to receive such payments upon termination are included.

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 effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are reported as debt service expenditures.

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 are reported as other financing uses. Issuance costs are reported as debt service expenditures.

In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period.

Deferred Outflows/Inflows of Resources - In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of net position or fund balance that applies to a future period and so will not be recognized as an outflow of resources (expense/expenditure) until then. The School District only has one item that qualifies for reporting in this category. It is the deferred outflow related to the pension plan.

In addition to liabilities, the statement of net position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of net position that applies to a future period and so will not be recognized as an inflow of resources (revenue) until that time. The School District has two types of this item. The first item arises only under a modified accrual basis of accounting, and is therefore only reported in the governmental funds balance sheet. The governmental funds report unavailable revenues from grant and categorical aid payments not collected during the period of availability. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available. The second item, which arises only on the government-wide statement of net position, is deferred inflows related to the pension plan.

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Note 1 - Summary of Significant Accounting Policies (Continued)

Fund Balance - In the fund financial statements, governmental funds report the following components of fund balance: Nonspendable: Amounts that are not in spendable form or are legally or contractually

required to be maintained intact Restricted: Amounts that are legally restricted by outside parties, constitutional

provisions, or enabling legislation for use for a specific purpose Committed: Amounts that have been formally set aside by the Board of Education for

use for specific purposes. Commitments are made and can be rescinded only via resolution of the Board of Education.

Assigned: Intent to spend resources on specific purposes expressed by the Board of

Education or superintendent, who is authorized by policy approved by the Board of Education to make assignments. The total voluntary severance plan pay obligation, over a three-year period, totals $5,080,368; however, there is insufficient unassigned fund balance to cover this total obligation by $1,853,255. Therefore, $3,227,113 has been assigned.

Unassigned: Amounts that do not fall into any other category above. This is the

residual classification for amounts in the General Fund and represents fund balance that has not been assigned to other funds and has not been restricted, committed, or assigned to specific purposes in the General Fund. In other governmental funds, only negative unassigned amounts are reported, if any, and represent expenditures incurred for specific purposes exceeding the amounts previously restricted, committed, or assigned to those purposes.

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Note 1 - Summary of Significant Accounting Policies (Continued)

The Board of Education has adopted a fund balance policy. The fund balance policy prescribes the minimum fund balance as 8 percent to 12 percent of expenditures in the General Fund. This is deemed to be the prudent amount to provide working capital to meet cash flow needs and avoid borrowing, serve as a budget stabilization fund, and provide for unanticipated or emergency expenditures.

Comparative Data - Comparative data is not included in the School District’s financial statements.

Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 revenue and expenses during the period. Actual results could differ from those estimates.

Pensions - For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Michigan Public School Employees’ Retirement System (MPSERS) and additions to/deductions from MPSERS fiduciary net position have been determined on the same basis as they are reported by MPSERS. MPSERS uses the economic resources measurement focus and the full accrual basis of accounting. Contribution revenue is recorded as contributions are due, pursuant to legal requirements. Benefit payments (including refunds of employee contributions) are recognized as expense when due and payable in accordance with the benefit terms. Related plan investments are reported at fair value.

Adoption of New Standard - The GASB issued GASB Statement No. 68, Accounting and Financial Reporting for Pensions, and GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date. Statement No. 68 requires governments providing defined benefit pensions to recognize their unfunded pension benefit obligation as a liability for the first time, and to more comprehensively and comparably measure the annual costs of pension benefits. Statement No. 71 is a clarification to GASB No. 68 requiring a government to recognize a beginning deferred outflow of resources for its pension contributions, if any, made subsequent to the measurement date of the beginning net pension liability The Statements also enhance accountability and transparency through revised note disclosures and required supplemental information (RSI). In accordance with the statement, the School District has reported a net pension liability of $235,256,166 and a beginning deferred outflow for pension contributions of $11,309,981 made subsequent to the September 30, 2013 measurement date, as a change in accounting principle adjustment to unrestricted net position as of July 1, 2014.

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Note 1 - Summary of Significant Accounting Policies (Continued)

Net position at June 30, 2014 93,715,558$ Net pension liablility (235,256,166) Deferred outflow for pension contributions 11,309,981

Net position - As restated - Beginning of year (130,230,627)$

Note 2 - Stewardship, Compliance, and Accountability

Budgetary Information - Annual budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America and state law for the General Fund and special revenue funds. All annual appropriations lapse at fiscal year end. The School District also elected to adopt annual budgets for its debt service funds and capital projects funds.

The budget document presents information by fund and function. The legal level of budgetary control adopted by the governing body (i.e., the level at which expenditures may not legally exceed appropriations) is the function level. State law requires the School District to have its budget in place by July 1. Expenditures in excess of amounts budgeted are a violation of Michigan law. State law permits districts to amend their budgets during the year. Two amendments to the General Fund, in January 2015 and June 2015, were approved by the Board of Education during the year to accommodate significant changes in revenue and expenditures expected. These changes were highlighted in the required supplemental information of the General Fund budgetary highlights, and in summary include revenue revisions totaling a net decrease of approximately $1.4 million consisting mainly of a net increase in state funding of approximately $0.2 million to reflect additional funding for retirement obligations, coupled with a loss in state funding of approximately $1.2 million due to a larger than expected decline in pupils, a decrease in local funding of approximately $0.5 million based upon revised properly tax values, a decrease in the proceeds from land sales of $0.5 million due to the delay of the sale of a property, a decrease of $0.6 million of transfers in from other funds based upon updated program costs and funding in the Special Education Center Fund and adjustment of grant awards.

Budgeted expenditures and other uses were reduced by $1.0 million on a net basis due to actual staffing in place, an increase in retirement costs for the UAAL (unfunded accrued actuarial liability) costs, and adjustments of grant awards.

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Note 2 - Stewardship, Compliance, and Accountability (Continued)

Encumbrance accounting is employed in governmental funds. Encumbrances (e.g., purchase orders and contracts) outstanding at year end are reported as assignments of fund balances and do not constitute expenditures or liabilities because the goods or services have not been received as of year end; the commitments will be reappropriated and honored during the subsequent year. Since all encumbrances are budgeted for in 2015-2016, no encumbrances are included in assigned fund balance at June 30, 2015.

Excess of Expenditures Over Appropriations in Budgeted Funds - The School District did not have any significant expenditure budget variances.

Capital Projects Fund Compliance - The Capital Projects Fund includes capital project activities funded with bonds issued after May 1, 1994. For this capital project, the School District has complied with the applicable provisions of §1351a of the State of Michigan’s School Code.

Note 3 - Deposits and Investments

State statutes and the School District’s investment policy authorize the School District to make deposits in the accounts of federally insured banks, credit unions, and savings and loan associations that have offices in Michigan. The School District is allowed to invest in U.S. Treasury or agency obligations, U.S. government repurchase agreements, bankers’ acceptances, commercial paper rated prime at the time of purchase that matures not more than 270 days after the date of purchase, mutual funds, and investment pools that are composed of authorized investment vehicles. The School District’s deposits are in accordance with statutory authority.

The School District has designated one bank for the deposit of its funds.

The School District’s cash and investments are subject to several types of risk, which are examined in more detail below:

Custodial Credit Risk of Bank Deposits

Custodial credit risk is the risk that in the event of a bank failure, the School District’s deposits may not be returned to it. The School District’s investment policy requires that financial institutions be evaluated and only those with an acceptable risk level be used for the School District’s deposits for custodial credit risk. The School District evaluates each financial institution with which it deposits funds and assesses the level of risk of each institution; only those institutions with an acceptable estimated risk level are used as depositories. At June 30, 2015, the School District did not have any deposit balances.

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Note 3 - Deposits and Investments (Continued)

Custodial Credit Risk of Investments

Custodial credit risk is the risk that, in the event of the failure of the counterparty, the School District will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The School District’s policy for custodial credit risk states that custodial credit risk will be minimized by limiting investments to the types of securities allowed by state law and by pre-qualifying the financial institutions, broker/dealers, intermediaries, and advisors with which the School District will do business using the criteria established in the investment policy. The School District does not have investments with custodial credit risk.

Interest Rate Risk

Interest rate risk is the risk that the value of investments will decrease as a result of a rise in interest rates. The School District’s investment policy does not restrict investment maturities, other than commercial paper which can only be purchased with a 270-day maturity. The School District’s policy minimizes interest rate risk by structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations, thereby avoiding the need to sell securities in the open market; investing operating funds primarily in shorter-term securities, liquid asset funds, money market mutual funds, or similar investment pools; and limiting the average maturity in accordance with the School District’s cash requirements.

Credit Risk

State law limits investments in commercial paper to the top two ratings issued by nationally recognized statistical rating organizations. The School District’s investment policy only allows purchases of commercial paper with ratings of A1/P1 and AA/Aa.

At year end, the credit quality ratings of securities (other than the U.S. government) are as follows:

Investment Fair Value Maturities Rating

Rating

Organization

Michigan Liquid Asset Fund - Cash Management Class 98,058,860$ N/A 2a7 like pool AAAm S&P

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Note 3 - Deposits and Investments (Continued)

Concentration of Credit Risk

The School District uses a pooled fund with Michigan Liquid Asset Fund (MILAF) for all of its cash accounts. A maximum of 30 percent of available funds may be invested in any one issuer. Since MILAF is a pooled fund, it is not considered a single issuer under School District policy. The investment advisor for the MILAF pool manages the investments under Rule 2a-7, which applies to money market funds, of the Securities and Exchange Commission’s Investment Act of 1940; however, there is no regulatory oversight for the investment pool. The pool shares are monitored daily using a net asset value shock test. This daily test ensures the fair value of the pool shares and removes the risk of the share value dipping below a value of 1.0. The School District’s policy minimizes concentration of credit risk by requiring diversification of the investment portfolio so that the impact of potential losses from any one type of security or issuer will be minimized.

Foreign Currency Risk

Foreign currency risk is the risk that an investment denominated in the currency of a foreign country could reduce its U.S. dollar value as a result of changes in foreign currency exchange rates. State law and the School District’s policy prohibit investment in foreign currency.

Note 4 - Unavailable/Unearned Revenue

Governmental funds report unavailable revenue in connection with receivables for revenue that is not considered to be available to liquidate liabilities of the current period. Governmental funds also defer unearned revenue recognition in connection with resources that have been received but not yet earned. At the end of the current fiscal year, the various components of unearned and unavailable revenue are as follows:

Deferred

Inflow -

Unavailable

Liability -

Unearned

Tuition and other - $ 699,420$ Grant and categorical aid payment received prior

to meeting all eligibility requirements - 108,927 Grant and categorical aid payment not received

within 60 days of year end 679,967 -

Total 679,967$ 808,347$

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Note 5 - Capital Assets

Capital asset activity of the School District’s governmental activities was as follows:

Balance

June 30, 2014

Reclassi-

fications Additions

Disposals

and

Adjustments

Balance

June 30, 2015

Assets not being depreciated:Land 1,022,344$ - $ - $ 34,999$ 987,345$ Construction in progress 14,871 (234,563) 305,913 - 86,221

Subtotal - Assets not being depreciated 1,037,215 (234,563) 305,913 34,999 1,073,566

Capital assets being depreciated:Buildings and building improvements 169,281,502 234,563 - - 169,516,065 Buses and other vehicles 10,283,128 - - 16,031 10,267,097 Furniture and equipment 11,799,527 - 194,662 - 11,994,189

Subtotal - Capital assets being depreciated 191,364,157 234,563 194,662 16,031 191,777,351

Accumulated depreciation:Buildings and building improvements 64,897,520 - 3,582,602 - 68,480,122 Buses and other vehicles 7,849,751 - 686,715 16,031 8,520,435 Furniture and equipment 9,085,601 - 581,788 - 9,667,389

Subtotal - Accumulated depreciation 81,832,872 - 4,851,105 16,031 86,667,946

Net capital assets being depreciated 109,531,285 234,563 (4,656,443) - 105,109,405

Net capital assets 110,568,500$ - $ (4,350,530)$ 34,999$ 106,182,971$

Depreciation expense was charged to the following governmental activities for the year ended June 30, 2015:

Governmental activities:Instruction 853,747$ Support services 962,439 Community services 22,063 Unallocated 3,012,856

Total governmental activities 4,851,105$

The School District considers many assets to impact multiple activities; therefore, allocation is not practical. The depreciation expense for these assets has been classified as unallocated.

The commitments related to construction in progress are not significant at June 30, 2015.

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Note 6 - Interfund Receivables, Payables, and Transfers

The composition of interfund balances is as follows:

Receivable Fund Payable Fund Amount

Due to/from other funds:General Fund Nonmajor governmental funds 103,447$ General Fund Fiduciary Fund 13,976 General Fund Building and Site 2015 Fund 7,920 Special Education Center Fund General Fund 2,167,941 Nonmajor governmental funds General Fund 68,854

Total 2,362,138$

The General Fund maintains the majority of the cash and investment accounts. Interfund balances are created upon recording of the revenue and expenditures for each applicable fund. All interfund balances are expected to be repaid within one year. The General Fund disburses funds on behalf of the Fiduciary Fund and is reimbursed accordingly.

Interfund Transfers

General

Fund

Special

Education

Center

Program

Nonmajor

Governmental

Funds Total

Transfers in:General Fund - $ 7,508,459$ 354,015$ 7,862,474$ Nonmajor governmental funds 145,000 63,000 409,419 617,419

Total 145,000$ 7,571,459$ 763,434$ 8,479,893$

Transfers Out

General Fund transfers out are used by the applicable funds to support and maintain the operations of the funds for the purpose for which they were created. County special education dollars are recorded in the Special Education Center Program Fund and are used to fund the center program operations, as well as tuition to send pupils to other school district center programs. The remainder of the funds is transferred back to the General Fund to fund non-center special education costs. Nutrition Services Funds are transferred to the General Fund to cover excess costs related to operations for the Nutrition Services Fund.

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Note 7 - Long-term Debt

The School District issues bonds, notes, and other contractual commitments to provide for the acquisition and construction of major capital facilities and the acquisition of certain equipment. General obligation bonds are direct obligations and pledge the full faith and credit of the School District. Notes and installment purchase agreements are also general obligations of the School District. Other long-term obligations include compensated absences, termination benefits, and certain risk liabilities.

Bonds are liquidated using the debt service funds. Compensated absences and workers’ compensation are liquidated in the governmental fund which pays for the applicable employee’s salary and benefits. These governmental funds include the General Fund, the Special Education Center Fund, and the Nutrition Services Fund.

Long-term obligation activity can be summarized as follows:

Balance

July 1, 2014 Additions Reductions

Balance

June 30, 2015

Due Within

One Year 2016

Governmental activities:Bonds 28,575,000$ 81,050,000$ (19,455,000)$ 90,170,000$ 7,215,000$ Bond premium 1,051,018 9,186,782 (217,452) 10,020,348 217,452

Total bonds payable 29,626,018 90,236,782 (19,672,452) 100,190,348 7,432,452

Compensated absences 3,958,819 - (382,764) 3,576,055 996,454 Voluntary severance incentive - 5,080,368 - 5,080,368 1,730,713 Workers' compensation 727,709 367,031 (372,662) 722,078 722,078

Total governmental activities 34,312,546$ 95,684,181$ (20,427,878)$ 109,568,849$ 10,881,697$ Annual debt service requirements to maturity for the above governmental bond obligations are as follows:

Governmental Activities

Principal Interest Total

2016 7,215,000$ 3,677,888$ 10,892,888$ 2017 7,430,000 4,025,450 11,455,450 2018 7,455,000 3,728,250 11,183,250 2019 5,350,000 3,378,500 8,728,500 2020 3,635,000 3,136,000 6,771,000 2021-2025 15,345,000 13,313,250 28,658,250 2026-2030 19,555,000 9,071,250 28,626,250 2031-2035 24,185,000 3,712,500 27,897,500

Total 90,170,000$ 44,043,088$ 134,213,088$

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Note 7 - Long-term Debt (Continued)

Governmental Activities

General obligation bonds consist of the following at June 30, 2015:

$11,180,000 serial bonds due in annual installments ranging from$2,065,000 to $2,500,000 through May 1, 2019; interest at 4.00percent 9,120,000$

$81,050,000 serial bonds due in annual installments ranging from$2,765,000 to $5,175,000 through May 1, 2035; interest rangingfrom 3.00 to 5.00 percent 81,050,000

Total bonded debt 90,170,000$

Advance Refunding - During the year, the School District issued $12,430,000 in general obligation bonds with an average interest rate of 5.0 percent. The proceeds of these bonds were used to advance refund $13,305,000 of outstanding 2005 refunding bonds with an average interest rate of 4.36 percent. The net proceeds of $13,063,221 (after payment of $74,589 in underwriting fees, insurance, and other issuance costs) plus an additional $400,700 of 2005 Debt Service Fund monies were deposited in an irrevocable trust with an escrow agent to provide for all future debt service payments on the original bonds. As a result, the bonds are considered to be defeased and the liability for the bonds has been removed from the School District’s long-term obligations. The advance refunding reduced total debt service payments by approximately $810,000, which represents an economic gain of approximately $746,000.

Voluntary Severance Incentive - During the year, the School District initiated a voluntary severance incentive program to employees. As a result, the School District has an obligation totaling $5,080,368, which includes the cost to fund the benefit paid to employees plus related fees to administer the program. This obligation will be funded by the School District over a three-year period commencing in August 2015.

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Note 8 - Risk Management

The School District is exposed to various risks of loss related to property loss, torts, errors and omissions, and employee injuries (workers’ compensation) as well as medical benefits provided to employees. The School District participates in the Middle Cities Risk Management Trust risk pool for claims relating to property loss, torts, and errors and omissions; the School District is partially uninsured for workers’ compensation and medical claims.

The shared-risk pool program in which the School District participates operates as a common risk-sharing management program for school districts in Michigan; member premiums are used to purchase commercial excess insurance coverage and to pay member claims in excess of deductible amounts. There have been no significant reductions in insurance coverage from the prior year. Settled claims relating to the commercial insurance have not exceeded the amount of insurance coverage in any of the past three fiscal years.

The School District estimates the liability for workers’ compensation claims that have been incurred through the end of the fiscal year, including both those claims that have been reported as well as those that have not yet been reported. These estimates are recorded as long-term debt in the government-wide statements as they are not considered due at June 30. At June 30, 2015, $722,078 is recorded as long-term debt.

Changes in the estimated liability for the past two fiscal years were as follows:

2015 2014

Estimated liability - Beginning of year 727,709$ 838,926$ Estimated claims incurred, including changes in

estimates 367,031 553,414 Claim payments (372,662) (664,631)

Estimated liability - End of year 722,078$ 727,709$

Under the School District’s workers’ compensation plan, the School District’s current maximum loss is limited to 100 percent of the normal workers’ compensation premiums. Losses in excess of the 100 percent limitation are insured up to an aggregate limit of $5,000,000. The School District is also insured against losses in excess of $100,000 to $500,000 for each occurrence, depending on the year the claim was made.

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Note 8 - Risk Management (Continued)

The School District is self-insured for medical claims. The School District estimates the liability for medical claims that have been incurred through the end of the fiscal year, including both those claims that have been reported as well as those that have not yet been reported. These estimates are recorded as accrued liabilities in the internal service fund. At June 30, 2015, the estimated liability for these medical claims totals $2,682,728.

Changes in the estimated liability for the past two fiscal years were as follows:

2015 2014

Estimated liability - Beginning of year 3,281,397$ 1,484,108$ Estimated claims incurred, including changes in

estimates 17,917,089 20,242,397 Claim payments (18,515,758) (18,445,108)

Estimated liability - End of year 2,682,728$ 3,281,397$

Note 9 - Michigan Public School Employees’ Retirement System

Plan Description - The School District participates in the Michigan Public School Employees’ Retirement System (MPSERS or the “System”), a statewide, cost-sharing, multiple-employer defined benefit public employee retirement system governed by the State of Michigan that covers substantially all employees of the School District. The System provides retirement, survivor, and disability benefits to plan members and their beneficiaries. The System also provides postemployment healthcare benefits to retirees and beneficiaries who elect to receive those benefits.

The Michigan Public School Employees’ Retirement System issues a publicly available financial report that includes financial statements and required supplemental information for the pension and postemployment healthcare plans. That report is available on the web at http://www.michigan.gov/orsschools, or by writing to the Office of Retirement System (ORS) at 7150 Harris Drive, P.O. Box 30171, Lansing, MI 48909.

Contributions - Public Act 300 of 1980, as amended, required the School District to contribute amounts necessary to finance the coverage of pension benefits of active and retired members. Contribution provisions are specified by State statute and may be amended only by action of the State Legislature. Under these provisions, each school district's contribution is expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance a portion of the unfunded accrued liability.

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Note 9 - Michigan Public School Employees’ Retirement System (Continued)

School district contributions are determined based on employee elections. There are seven different benefit options included in the plan available to employees based on date of hire. Contribution rates are adjusted annually by the ORS. The range of rates is as follows: July 1, 2013 - September 30, 2013 12.78% - 16.25% October 1, 2013 - September 30, 2014 15.44% - 18.34% October 1, 2014 - June 30, 2015 18.76% - 23.07%

Depending on the plan selected, plan member contributions range from 0 percent up to 7.0 percent of gross wages. Plan members electing into the defined contribution plan are not required to make additional contributions.

The School District’s required and actual contributions to the plan for the years ended June 30, 2015 and 2014 were $17,999,760 and $14,520,815, respectively. Contributions include $7,482,568 in revenue received from the State of Michigan to fund the MPSERS Unfunded Actuarial Accrued Liability (UAAL) Stabilization Rate for the year ended June 30, 2015.

Benefits Provided - Benefit provisions of the defined benefit pension plan are established by State statute, which may be amended. Public Act 300 of 1980, as amended, establishes eligibility and benefit provisions for the defined benefit (DB) pension plan.

Depending on the plan option selected, member retirement benefits are calculated as final average compensation times years of service times a pension factor ranging from 1.25 percent to 1.50 percent. The requirements to retire range from attaining the age of 46 to 60 with years of service ranging from 5 to 30 years, depending on when the employee became a member. Early retirement is computed in the same manner as a regular pension, but is permanently reduced 0.50 percent for each full and partial month between the pension effective date and the date the member will attain age 60. There is no mandatory retirement age.

Members are eligible for non-duty disability benefits after 10 years of service and for duty-related disability benefits upon hire. Disability retirement benefits are determined in the same manner as retirement benefits but are payable immediately without an actuarial reduction. The disability benefits plus authorized outside earnings are limited to 100 percent of the participant’s final average compensation with an increase of 2 percent each year thereafter.

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Note 9 - Michigan Public School Employees’ Retirement System (Continued)

Benefits may transfer to a beneficiary upon death, and are determined in the same manner as retirement benefits, but with an actuarial reduction.

Benefit terms provide for annual cost-of-living adjustments to each employee’s retirement allowance subsequent to the employee’s retirement date. The annual adjustment, if applicable, is 3 percent. For some members that do not receive an annual increase, they are eligible to receive a supplemental payment in those years when investment earnings exceed actuarial assumptions.

Net Pension Liability, Deferrals, and Pension Expense - At June 30, 2015, the School District reported a liability of $221,281,477 for its proportionate share of the net pension liability. The net pension liability was measured as of September 30, 2014, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of September 30, 2013, which used updated procedures to roll forward the estimated liability to September 30, 2014. The School District’s proportion of the net pension liability was based on a projection of its long-term share of contributions to the pension plan relative to the projected contributions of all participating reporting units, actuarially determined. At September 30, 2014, the School District’s proportion was 1.00461 percent, which, in the year of adoption, is unchanged from its proportion measured as of September 30, 2013.

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Note 9 - Michigan Public School Employees’ Retirement System (Continued)

For the year ended June 30, 2015, the School District recognized pension expense of $15,089,328. At June 30, 2015, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred Outflows of Resources

Subsequent to the Measurement

Date

Net Deferred Inflows

(Outflows) of Resources as of

the Measurement Date

Difference between expected and actual experience $ - $ -

Changes of assumptions - (8,164,813) Net difference between projected and

actual earnings on pension plan assets - 24,462,757 Changes in proportion and differences

between School District's contributions and proportionate share of contributions - (1,099)

School District's contributions subsequent to the measurement date 14,145,073 -

Total $ 14,145,073 $ 16,296,845

Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ending June 30 Amount

2016 $ 3,992,301

2017 3,992,301

2018 3,992,301

2019 4,319,942

2020 -

Thereafter -

Total $ 16,296,845

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Note 9 - Michigan Public School Employees’ Retirement System (Continued)

In addition, the contributions subsequent to the measurement date will be included as a reduction of the net pension liability in the next year. Actuarial Assumptions - The total pension liability as of September 30, 2014 is based on the results of an actuarial valuation date of September 30, 2013, is rolled forward, and was determined using the following actuarial assumptions applied to all periods included in the measurement: Actuarial cost method Entry age normal cost actuarial cost method Assumed rate of return 7.00 to 8.00 percent, net of investment and administrative

expenses based on the groups Rate of pay increases 3.50 percent Mortality basis RP-2000 Combined Healthy Mortality Table, adjusted for

mortality improvements to 2025 using projection scale BB The actuarial assumptions used for the September 30, 2013 valuation were based on the results of an actuarial experience study for the period from October 1, 2007 to September 30, 2012. As a result of this study, the actuarial assumptions were adjusted to more closely reflect actual experience. Discount Rate - The discount rate used to measure the total pension liability was 7.00 - 8.00 percent. The projection of cash flows used to determine the discount rate assumed that employee contributions will be made at the current contribution rate and that employer contributions will be made at contractually required rates. Based on those assumptions, the pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments for current active and inactive employees. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

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Note 9 - Michigan Public School Employees’ Retirement System (Continued)

The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Investment Category Target Allocation

Long-term Expected Real Rate of

Return

Domestic Equity Pools 28% 4.8% Private Equity Pools 18% 8.5% International Equity Pools 16% 6.1% Fixed Income Pools 10% 1.5% Real Estate and Infrastructure Pools 10% 5.3% Real Return, Opportunistic, and Absolute

Pool 16% 6.3% Short Term Investment Pools 2% (0.2)%

Total 100% Sensitivity of the Net Pension Liability to Changes in the Discount Rate - The following presents the net pension liability of the School District, calculated using the discount rate of 7.00 to 8.00 percent, depending on the plan option, as well as what the School District’s net pension liability would be if it were calculated using a discount rate that is 1.00 percentage point lower or 1.00 percentage point higher than the current rate:

1.00 Percent Decrease

(7.00/6.00 percent) Current Discount Rate

(8.00/7.00 percent) 1.00 Percent Increase (9.00/8.00 percent)

$ 291,740,359 $ 221,281,477 $ 161,918,829 Pension Plan Fiduciary Net Position - Detailed information about the pension plan’s fiduciary net position is available in the separately issued MPSERS financial report.

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Note 9 - Michigan Public School Employees’ Retirement System (Continued)

Payable to the Pension Plan - At June 30, 2015, the School District reported a payable of $3,537,670 for the outstanding amount of contributions to the pension plan required for the year ended June 30, 2015.

Postemployment Benefits Other Than Pensions (OPEB) - Under the MPSERS Act, all retirees participating in the MPSERS pension plan have the option of continuing health, dental, and vision coverage through MPSERS. Retirees electing this coverage contribute an amount equivalent to the monthly cost for Part B Medicare and 10 percent, or 20 percent for those not Medicare eligible, of the monthly premium amount for the health, dental, and vision coverage at the time of receiving the benefits. The MPSERS board of trustees annually sets the employer contribution rate to fund the benefits on a pay-as-you-go basis. Participating employers are required to contribute at that rate. The employer contribution rate ranged from 5.52 percent to 6.45 percent of covered payroll for the period from July 1, 2014 to September 30, 2014, and from 2.20 percent to 2.71 percent of covered payroll for the period from October 1, 2014 through June 30, 2015 dependent upon the employee’s date of hire and plan election as noted above. Members can choose to contribute 3 percent of their covered payroll to the Retiree Healthcare Fund and keep this premium subsidy benefit, or they can elect not to pay the 3 percent contribution and instead choose the Personal Healthcare Fund, which can be used to pay healthcare expenses in retirement. Members electing the Personal Healthcare Fund will be automatically enrolled in a 2 percent employee contribution into their 457 account as of their transition date and create a 2 percent employer match into the employee’s 403B account.

The School District’s required and actual contributions to the plan for retiree health- care benefits for the years ended June 30, 2015, 2014, and 2013 were $3,478,315, $7,302,292, and $8,505,818, respectively.

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Note 10 - State Aid Anticipation Note

At June 30, 2015, The School District had the following state aid anticipation notes outstanding:

July 1, 2014 Reductions June 30, 2015

$1,687,500 state aid anticipation note due August 20,2015; effective interest at 1.313 percent 1,687,500$ -$ 1,687,500$

$2,062,500 state aid anticipation note due August 20,2015; effective interest at 1.313 percent 2,062,500 - 2,062,500

$3,750,000 state aid anticipation note due in sevenannual installments, including interest, ranging from$535,889 to $542,216, starting January 20, 2015through July 20, 2015; effective interest at 0.688percent 3,750,000 (3,214,286) 535,714

Total 7,500,000$ (3,214,286)$ 4,285,714$

At June 30, 2015, the School District has accrued interest of $175 on these notes. These notes were paid off on their respective due dates.

On August 20, 2015, the School District borrowed a total of $8,700,000 in state aid anticipation notes as follows:

$2,142,157 state aid anticipation note due August 20, 2016; effectiveinterest at 1.462 percent 2,142,157$

$2,857843 state aid anticipation note due August 20, 2016; effectiveinterest at 1.462 percent 2,857,843

$2,514,407 state aid anticipation note due in seven annual installments,including interest, ranging from $359,429 to $367,163, starting January 20,2016 through July 20, 2016; effective interest at 0.992 percent 2,514,407

$1,185,593 state aid anticipation note due in seven annual installments,including interest, ranging from $169,461 to $172,532, starting January 20,2016 through July 20, 2016; effective interest at 0.992 percent 1,185,593

Total state aid anticipation notes 8,700,000$

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RRequired Supplemental Information

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Required Supplemental Information Budgetary Comparison Schedule - General Fund

Year Ended June 30, 2015

Original

Budget

Final

Budget Actual

Over (Under) Final

Budget

Revenue Local sources 44,953,740$ 44,449,734$ 44,733,245$ 283,511$ State sources 80,092,397 80,350,470 80,240,701 (109,769) Federal sources 4,994,201 5,051,618 4,260,242 (791,376) Interdistrict sources 757,476 651,268 677,831 26,563

Total revenue 130,797,814 130,503,090 129,912,019 (591,071)

ExpendituresCurrent:

Instruction:Basic programs 71,185,403 71,497,925 70,884,343 (613,582) Added needs 17,634,702 17,116,026 16,571,372 (544,654) Adult and continuing education 110,519 87,719 81,834 (5,885)

Support services:Pupil 14,189,432 14,479,072 14,370,016 (109,056) Instructional staff 7,095,345 6,469,745 5,875,249 (594,496) General administration 1,162,327 1,147,648 1,157,552 9,904 School administration 7,419,088 7,474,813 7,435,919 (38,894) Business services 1,876,071 1,688,379 1,644,166 (44,213) Operation and maintenance 10,819,084 10,698,318 10,350,549 (347,769) Transportation 6,807,458 6,600,665 6,678,643 77,978 Central services 3,228,415 3,367,935 3,329,912 (38,023)

Community services 1,456,058 1,443,531 1,424,828 (18,703) Athletics 1,940,380 1,833,857 1,799,480 (34,377)

Intergovernmental payments 151,111 135,839 136,226 387 Capital outlay 1,800 - - -

Total expenditures 145,077,193 144,041,472 141,740,089 (2,301,383)

Other Financing Sources (Uses)Transfers in 7,820,736 7,211,608 7,862,474 650,866 Transfers out (145,000) (145,000) (145,000) - Proceeds from sale of capital assets 1,020,000 520,000 502,255 (17,745)

Total other financingsources 8,695,736 7,586,608 8,219,729 633,121

Net Change in Fund Balance (5,583,643) (5,951,774) (3,608,341) 2,343,433

Fund Balance - Beginning of year 11,968,069 11,968,069 11,968,069 -

Fund Balance - End of year 6,384,426$ 6,016,295$ 8,359,728$ 2,343,433$

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Required Supplemental Information Budgetary Comparison Schedule - Special Education

Center Program Fund Year Ended June 30, 2015

Original

Budget

Final

Budget Actual

Over (Under)

Final Budget

Revenue State sources 2,242,951$ 2,641,812$ 2,662,998$ 21,186$ Interdistrict sources 12,076,016 11,922,414 11,967,501 45,087

Total revenue 14,318,967 14,564,226 14,630,499 66,273

ExpendituresCurrent - Instruction - Added needs 4,383,426 4,640,895 4,497,280 (143,615) Support services:

Pupil 1,655,605 1,725,861 1,820,088 94,227 Instructional staff 252,936 268,664 282,689 14,025 Operation and maintenance 167,029 162,356 140,289 (22,067) Transportation 28,000 28,000 20,860 (7,140)

Intergovernmental payments 473,000 792,835 297,835 (495,000) Capital outlay 25,000 25,000 81,093 56,093

Total expenditures 6,984,996 7,643,611 7,140,134 (503,477)

Other Financing Uses -Transfers out (7,575,576) (6,920,615) (7,571,459) (650,844)

Net Change in Fund Balance (241,605) - (81,094) (81,094)

Fund Balance - Beginning of year 2,050,345 2,050,345 2,050,345 -

Fund Balance - End of year 1,808,740$ 2,050,345$ 1,969,251$ (81,094)$

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Required Supplemental Information Schedule of Proportionate Share of the Net Pension Liability

Michigan Public School Employees’ Retirement System Determined as of the Plan Year Ended September 30, 2014

School District’s proportion of the net pension liability (asset) 1.00461%

School District’s proportionate share of the net pension liability (asset) $ 221,281,477

School District’s covered employee payroll $ 85,259,183

School District’s proportionate share of the net pension liability (asset) as a percentage of its covered employee payroll 259.54%

Plan fiduciary net position as a % of the total pension liability 66.20000%

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Required Supplemental Information Schedule of Contributions

Michigan Public School Employees’ Retirement System Determined as of the Year Ended June 30, 2015

Statutorily required contribution $ 17,999,760

Contribution in relation to the statutorily required contribution 17,999,760

Contribution deficiency (excess) -

School District's covered employee payroll 81,965,999

Contribution as a percentage of covered employee payroll 21.96003%

Note to Pension Required Supplemental Information Schedules Benefit Changes - There were no changes of benefit terms in 2015 Changes in Assumptions - There were no changes of benefit assumptions in 2015.

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OOther Supplemental Information

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Other Supplemental Information Combining Balance Sheet

Nonmajor Governmental Funds June 30, 2015

Special Revenue

Fund

Nutrition

Services 2004 Issue 2005 Issue 2013 Issue 2015 Issue

Technology/

Other Projects

Maintenance/

Bus Purchases Total

AssetsCash and investments 1,091,997$ - $ -$ - $ - $ 84,487$ - $ 1,176,484$ Receivables:

Taxes - - - 2,000 - - - 2,000 Accounts receivable 309 - - - 3,043 - - 3,352 Due from other governmental units 84,553 - - - - - - 84,553

Due from other funds - - 2 15 - 5 68,832 68,854 Inventories 34,038 - - - - - - 34,038

Restricted assets - - 20,515 201,454 - - - 221,969

Total assets 1,210,897$ - $ 20,517$ 203,469$ 3,043$ 84,492$ 68,832$ 1,591,250$

Liabilities and Fund Balances

LiabilitiesAccounts payable 1,389$ - $ - $ - $ - $ 7,208$ - $ 8,597$ Accrued payroll 25,465 - - - - - - 25,465 Due to other funds 103,447 - - - - - - 103,447 Unearned revenue 62,884 - - - - - - 62,884

Total liabilities 193,185 - - - - 7,208 - 200,393

Fund BalancesNonspendableNonspendable - Inventories 34,038 - - - - - - 34,038 Restricted:

Nutrition services 983,674 - - - - - - 983,674 Debt service - - 20,517 203,469 3,043 - - 227,029

Committed - Capital projects - - - - - 77,284 68,832 146,116

Total fund balances 1,017,712 - 20,517 203,469 3,043 77,284 68,832 1,390,857

Total liabilities and fund balances 1,210,897$ - $ 20,517$ 203,469$ 3,043$ 84,492$ 68,832$ 1,591,250$

Capital Projects FundsDebt Service Funds

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Other Supplemental Information Combining Statement of Revenue, Expenditures, and

Changes in Fund Balances - Nonmajor Governmental Funds Year Ended June 30, 2015

Nutrition

Services 2004 Issue 2005 Issue 2013 Issue 2015 Issue

Technology/

Other Projects

Maintenance/Bus

Purchases Total

RevenueLocal sources 2,172,048$ - $ 4,793,761$ 2,527,195$ - $ 28,436$ - $ 9,521,440$ State sources 159,533 - 24,570 13,230 - - - 197,333 Federal sources 1,471,139 - - - - - - 1,471,139 Interdistrict sources 49,332 - - - - - - 49,332

Total revenue 3,852,052 - 4,818,331 2,540,425 - 28,436 - 11,239,244

ExpendituresCurrent - Nutrition services 3,676,318 - - - - - - 3,676,318 Debt service:

Principal - - 4,215,000 1,935,000 - - - 6,150,000 Bond issuance costs - - - - 74,589 - - 74,589 Interest and other - 1,000 1,310,376 459,808 - - - 1,771,184

Capital outlay - - - - - 57,157 350,091 407,248

Total expenditures 3,676,318 1,000 5,525,376 2,394,808 74,589 57,157 350,091 12,079,339

Excess of Revenue Over (Under) Expenditures

175,734 (1,000) (707,045) 145,617 (74,589) (28,721) (350,091) (840,095)

Other Financing Sources (Uses)Transfers in 63,000 - 409,419 - - - 145,000 617,419 Transfers out (154,015) (409,419) - - - (200,000) - (763,434)

Face value of debt issued - - - - 12,430,000 - - 12,430,000

Premium on debt issued - - - - 710,853 - - 710,853

Payment to bond escrow agent - - - - (13,063,221) - - (13,063,221)

Total other financing (uses) sources (91,015) (409,419) 409,419 - 77,632 (200,000) 145,000 (68,383)

Net Change in Fund Balances 84,719 (410,419) (297,626) 145,617 3,043 (228,721) (205,091) (908,478)

Fund Balances - Beginning of year 932,993 410,419 318,143 57,852 - 306,005 273,923 2,299,335

Fund Balances - End of year 1,017,712$ - $ 20,517$ 203,469$ 3,043$ 77,284$ 68,832$ 1,390,857$

Special

Revenue Fund Capital Projects FundsDebt Service Funds

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Other Supplemental Information Budgetary Comparison Schedule - Nonmajor Special Revenue Fund

Year Ended June 30, 2015

Original

Budget

Final

Budget Actual

Over

(Under) Final

Budget

RevenueLocal sources 2,166,500$ 2,226,300$ 2,172,048$ (54,252)$ State sources 147,279 159,077 159,533 456 Federal sources 1,429,109 1,542,802 1,471,139 (71,663) Interdistrict sources 39,718 49,332 49,332 -

Total revenue 3,782,606 3,977,511 3,852,052 (125,459)

Expenditures - Current - Nutrition services 3,895,486 3,718,225 3,676,318 (41,907)

Excess of Revenue (Under) Over Expenditures (112,880) 259,286 175,734 (83,552)

Other Financing Sources (Uses)Transfers in 63,000 63,000 63,000 - Transfers out (108,160) (153,993) (154,015) (22)

Total other financing uses (45,160) (90,993) (91,015) (22)

Net Change in Fund Balances (158,040) 168,293 84,719 (83,574)

Fund Balances - Beginning of year 932,993 932,993 932,993 -

Fund Balances - End of year 774,953$ 1,101,286$ 1,017,712$ (83,574)$

Note: The budget has been adopted on a basis consistent with accounting principles generally accepted in the United States of America.

Nutrition Services Fund

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Other Supplemental Information Budgetary Comparison Schedule - Nonmajor Debt Service Funds

Year Ended June 30, 2015

2004 Issue 2005 Issue 2013 Issue 2015 Issue

Original

Budget

Final

Budget Actual Actual Actual Actual Total All Issues

Over (Under)

Final Budget

RevenueLocal sources 7,338,681$ 7,311,158$ - $ 4,793,761$ 2,527,195$ - $ 7,320,956$ 9,798$

State sources - 37,800 - 24,570 13,230 - 37,800 -

Total revenue 7,338,681 7,348,958 - 4,818,331 2,540,425 - 7,358,756 9,798

Expenditures - Debt servicePrincipal 6,150,000 6,150,000 - 4,215,000 1,935,000 - 6,150,000 - Bond issuance costs - 91,249 - - - 74,589 74,589 (16,660) Interest and other 1,418,450 1,394,450 1,000 1,310,376 459,808 - 1,771,184 376,734

Total expenditures 7,568,450 7,635,699 1,000 5,525,376 2,394,808 74,589 7,995,773 360,074

Excess of Revenue (Under) OverExpenditures (229,769) (286,741) (1,000) (707,045) 145,617 (74,589) (637,017) (350,276)

Other Financing Sources (Uses)Transfers in - - - 409,419 - - 409,419 409,419 Transfers out - - (409,419) - - - (409,419) (409,419) Proceeds from debt issuance - 13,167,405 - - - 12,430,000 12,430,000 (737,405) Premium on debt issued - - - - - 710,853 710,853 710,853 Payment to bond escrow agent - (13,476,856) - - - (13,063,221) (13,063,221) 413,635

Total other financing (uses) sources - (309,451) (409,419) 409,419 - 77,632 77,632 387,083

Net Change in Fund Balances (229,769) (596,192) (410,419) (297,626) 145,617 3,043 (559,385) 36,807

Fund Balances - Beginning of year 786,414 786,414 410,419 318,143 57,852 - 786,414 -

Fund Balances - End of year 556,645$ 190,222$ - $ 20,517$ 203,469$ 3,043$ 227,029$ 36,807$

Note: The budget has been adopted on a basis consistent with accounting principles generally accepted in the United States of America.

Total Debt Service Funds

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Other Supplemental Information Budgetary Comparison Schedule - Capital Projects Funds

Year Ended June 30, 2015

Original

Budget

Final

Budget Actual

Over

(Under) Final

Budget

Revenue - Local sources 5$ 28,428$ 28,436$ 8$

Expenditures - Capital outlay 35,000 66,607 57,157 (9,450)

Excess of Expenditures Over Revenue (34,995) (38,179) (28,721) 9,458

Other Financing (Uses) Sources - Transfers (out) in

(200,000) (200,000) (200,000) -

Net Change in Fund Balances (234,995) (238,179) (228,721) 9,458

Fund Balances - Beginning of year 306,005 306,005 306,005 -

Fund Balances - End of year 71,010$ 67,826$ 77,284$ 9,458$

Note: The budget has been adopted on a basis consistent with accounting principles generally accepted

in the United States of America.

Technology/Other Projects

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Other Supplemental Information Budgetary Comparison Schedule - Capital Projects Funds

Year Ended June 30, 2015

Original

Budget

Final

Budget Actual

Over (Under)

Final Budget

- $ - $ - $ - $

508,320 418,923 350,091 (68,832)

(508,320) (418,923) (350,091) 68,832

145,000 145,000 145,000 -

(363,320) (273,923) (205,091) 68,832

273,923 273,923 273,923 -

(89,397)$ - $ 68,832$ 68,832$

Maintenance/Bus Purchases

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Other Supplemental Information Schedule of Bonded Indebtedness

June 30, 2015

Years Ending 2013 Issue 2015 Issue

June 30 Principal Principal

2016 2,065,000$ 5,150,000$ 2017 2,255,000 5,175,000 2018 2,300,000 5,155,000 2019 2,500,000 2,850,000 2020 - 3,635,000 2021 - 2,765,000 2022 - 2,915,000 2023 - 3,070,000 2024 - 3,215,000 2025 - 3,380,000 2026 - 3,550,000 2027 - 3,725,000 2028 - 3,905,000 2029 - 4,090,000 2030 - 4,285,000 2031 - 4,480,000 2032 - 4,675,000 2033 - 4,845,000 2034 - 5,040,000 2035 - 5,145,000

9,120,000$ 81,050,000$

Principal payments due May 1 May 1

Interest payments due May 1 and November 1

May 1 and November 1

Interest rate4.00%

3.00% to 5.00%

Original issue 11,180,000$ 81,050,000$

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Other Supplemental Information Fiduciary Fund

Statement of Changes in Fiduciary Assets and Liabilities Year Ended June 30, 2015

Balance

July 1, 2014 Additions Deductions

Balance

June 30, 2015

AssetsCash and investments 1,049,731$ 1,973,645$ 1,931,583$ 1,091,793$ Accounts receivable 8,558 7,593 10,425 5,726

Total assets 1,058,289$ 1,981,238$ 1,942,008$ 1,097,519$

LiabilitiesAccounts payable 49,257$ 81,308$ 49,257$ 81,308$ Due to other funds 74,256 72,570 132,850 13,976 Due to student groups 934,776 1,827,360 1,759,901 1,002,235

Total liabilities 1,058,289$ 1,981,238$ 1,942,008$ 1,097,519$

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Other Supplemental Information Schedule of Fiduciary Fund Activities

Year Ended June 30, 2015

Balance

June 30, 2014 Receipts Disbursements

Balance

June 30, 2015

Alameda Early Childhood 20,409$ 3,166$ 13,613$ 9,962$ Beechview Elementary School 7,961 18,319 9,136 17,144 Bilingual Program 3,962 32,672 22,703 13,931 Cloverdale 4,522 4,145 4,728 3,939 Curriculum 2,751 639 3,390 - Delta Program 1,128 - 30 1,098 District Science 5,810 200 - 6,010 Dunckel Middle School 42,782 79,693 79,957 42,518 East Middle School 66,415 60,510 59,342 67,583 F/FH Education Foundation 312 21,569 21,569 312 Farmington Central High School 3,839 12,690 6,789 9,740 Farmington Community School 5,203 7,507 10,656 2,054 Farmington High School 261,173 412,642 417,593 256,222 Forest Elementary School 13,752 21,364 21,521 13,595 Gill Elementary School 3,889 39,332 38,304 4,917 Harrison High School 106,071 332,864 307,416 131,519 Highmeadow Elementary School 6,501 19,120 21,047 4,574 Hillside Elementary School 6,906 59,314 30,561 35,659 Kenbrook Elementary School 13,693 17,869 18,389 13,173 Lanigan Elementary School 4,321 11,208 10,697 4,832 Leadership Team 1,583 - - 1,583 Longacre Elementary School 22,180 38,982 38,153 23,009 Malen Terry Scholarship 5,236 247 - 5,483 Media 327 - 232 95 Music Program 13,602 - - 13,602 North Farmington High School 180,960 378,628 366,512 193,076 Power Upper Elementary School 46,215 89,691 88,587 47,319 School/Community Relations 5,771 14,144 14,847 5,068 Special Education 2,500 - - 2,500 Student Assistance 200 26 26 200 Visions Unlimited 19,728 28,384 36,373 11,739 Warner Upper Elementary School 41,572 103,329 95,405 49,496 Wood Creek Elementary School 13,502 19,106 22,325 10,283

Total 934,776$ 1,827,360$ 1,759,901$ 1,002,235$

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CCash and Investments

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Other Supplemental Information Schedule of Cash, Cash Equivalents, and Investments

June 30, 2015

Fund Types of Investment

Interest

Rate

(Percent)

Date of

Maturity Cost

General Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 146,322$

Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 70,115

Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 867,785

Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 41,767

Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 100,736

Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 9,346,835

Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 10,021

Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 3,773,125

Total General Fund 14,356,706

Special Revenue Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 1,091,997

Debt Service Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 221,969

Capital Projects Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 84,487

Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 76,632,112

Trust and Agency Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 1,091,793

Internal Service Cash Management Fund - Michigan School DistrictLiquid Asset Fund Variable - 4,536,345

Total cash, cash equivalents, and investments 98,015,409$

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CCapital Assets and Accumulated Depreciation

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Land

Buildings

and Building

Improvements

Furniture

and

Equipment

Buses and Other

Vehicles

Construction in

Progress Total

Elementary SchoolsAlameda 53,447$ 1,393,181$ 30,392$ - $ - $ 1,477,020$ Beechview 25,250 3,414,649 104,674 - - 3,544,573 Fairview 17,502 - - - - 17,502 Forest 31,980 2,693,273 83,286 - - 2,808,539 Gill 4,137 3,366,273 266,553 - - 3,636,963 Highmeadow 49,226 3,354,044 94,208 - - 3,497,478 Hillside 16,301 7,235,851 149,603 - - 7,401,755 Kenbrook 24,900 4,199,781 132,139 - - 4,356,820 Lanigan 37,800 4,046,579 182,075 - - 4,266,454 Longacre 30,300 4,489,611 119,694 - - 4,639,605 William Grace 83,000 - - - - 83,000 Wood Creek 4,391 3,544,759 232,802 - - 3,781,952 Wooddale 4,047 - - - - 4,047

Upper Elementary SchoolsPower 4,137 7,331,726 371,813 - - 7,707,676 Warner 180,000 8,185,404 291,076 - - 8,656,480

Middle SchoolsDunckel 36,000 10,978,363 308,102 - - 11,322,465 East 57,500 10,497,732 397,371 - - 10,952,603

High SchoolsFarmington 1 28,555,852 1,164,283 - - 29,720,136 Harrison 199,050 27,125,743 1,293,272 - - 28,618,065 North 117,600 28,940,244 1,711,203 - - 30,769,047

Shiawassee Complex - 3,999,379 4,242,652 - 5,128 8,247,159 Maxfield Training Center 2 2,302,397 5,606 - - 2,308,005 Farmington Community School 6,501 1,668,447 109,810 - - 1,784,758 Maintenance 4,273 311,009 541,456 - - 856,738 Cloverdale - 1,780,964 126,826 - 81,093 1,988,883 Alternative Academy - - 5,350 - - 5,350 Visions - 100,804 29,943 - - 130,747 Vehicles - - - 10,267,097 - 10,267,097

Total 987,345$ 169,516,065$ 11,994,189$ 10,267,097$ 86,221$ 192,850,917$

Cost

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66

Other Supplemental Information Schedule of Capital Assets and Accumulated Depreciation

June 30, 2015

Buildings

and Building

Improvements

Furniture

and

Equipment

Buses and Other

Vehicles Total

563,824$ 13,576$ - $ 577,400$ 1,339,292 77,411 - 1,416,703

- - - - 1,184,207 63,683 - 1,247,890 1,459,818 169,135 - 1,628,953 1,301,076 67,671 - 1,368,747 3,129,661 108,777 - 3,238,438 1,656,978 102,721 - 1,759,699 1,624,704 136,950 - 1,761,654 1,563,338 73,383 - 1,636,721

- - - - 1,620,816 112,022 - 1,732,838

- - - -

3,044,165 233,087 - 3,277,252 3,619,501 173,964 - 3,793,465

4,227,973 224,537 - 4,452,510 4,058,302 288,442 - 4,346,744

11,383,289 847,457 - 12,230,746 11,243,043 1,094,213 - 12,337,256 11,167,930 1,433,681 - 12,601,611

1,282,161 3,869,224 - 5,151,385 1,266,110 5,606 - 1,271,716

767,742 69,897 - 837,639 204,999 392,125 - 597,124 748,301 89,436 - 837,737

- 5,350 - 5,350 22,892 15,041 - 37,933

- - 8,520,435 8,520,435

68,480,122$ 9,667,389$ 8,520,435$ 86,667,946$

Accumulated Depreciation

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SStatistical Section

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Description of Statistical Section

67

This part of Farmington Public School District’s Comprehensive Annual Financial Report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplemental information says about the government’s overall financial health. Many of the schedules present data for the past fiscal years that will allow the reader to discern trends that cannot be seen in a single year’s financial statements.

Contents

Financial Trend Information These schedules contain trend information to help the reader understand how the School District’s financial performance and well-being have changed over time.

Revenue Capacity Information These schedules contain information to help the reader assess the School District’s most significant local revenue source, the property tax.

Debt Capacity Information These schedules present information to help the reader assess the affordability of the School District’s current levels of outstanding debt and the School District’s ability to issue additional debt in the future.

Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within which the School District’s financial activities take place.

Operating Information These schedules contain service and infrastructure data to help the reader understand how the information in the School District’s financial report relates to the services the School District provides and the activities it performs.

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2006 2007 2008 2009 2010

Governmental ActivitiesNet investment

in capital assets 62,757,854$ 64,254,664$ 68,749,233$ 72,382,303$ 67,745,598$ Restricted 2,823,188 2,032,385 907,407 537,407 3,434,764 Unrestricted 32,172,676 31,721,790 36,870,342 34,388,054 22,595,755

Total primary governmentalnet position 97,753,718$ 98,008,839$ 106,526,982$ 107,307,764$ 93,776,117$

Source: Farmington Public School District audited financial statements

GASB 68 and 71 have been adopted effective July 1, 2014. Net position prior to June 30, 2015 has not been restated in this table.

June 30

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Financial Trend Information Net Position by Component

Governmental Activities Last Ten Fiscal Years

2011 2012 2013 2014 2015

71,908,876$ 76,376,114$ 78,514,622$ 80,942,482$ 82,595,528$ 2,811,215 2,924,431 3,359,899 3,769,752 2,986,963

25,492,876 19,064,510 14,026,621 9,003,324 (222,340,637)

100,212,967$ 98,365,055$ 95,901,142$ 93,715,558$ (136,758,146)$

June 30

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2006 2007 2008 2009 2010

ExpensesGovernmental activities:

Instruction 100,473,625$ 97,793,968$ 92,551,043$ 97,972,023$ 98,749,017$ Support services 64,027,209 63,706,879 61,606,469 63,072,628 63,369,009 Nutrition services 3,648,263 3,915,074 3,944,661 4,015,673 4,007,796 Athletics 2,296,843 2,310,316 2,320,740 2,418,962 2,349,801 Community services 1,915,783 1,806,004 1,722,971 1,435,925 1,375,371 Interest on long-term debt 3,274,622 3,024,353 2,838,058 2,597,085 2,644,130 Depreciation (unallocated) 2,294,225 2,705,632 2,802,013 2,845,582 2,905,796

Total governmental activities 177,930,570 175,262,226 167,785,955 174,357,878 175,400,920

Program RevenueCharges for services: *

Instruction 177,799 138,167 308,257 153,850 167,093 Support services 315,203 373,858 631,939 619,956 458,950 Nutrition services 3,058,887 2,967,053 3,017,669 2,916,709 2,690,018 Athletics 286,739 390,851 368,823 428,455 422,652 Community services 1,696,984 1,591,299 1,610,172 1,168,993 1,035,179

Operating grants and contributions 32,907,374 35,250,506 34,945,819 40,120,616 37,441,769

Total program revenue 38,442,986 40,711,734 40,882,679 45,408,579 42,215,661

Net expense (139,487,584) (134,550,492) (126,903,276) (128,949,299) (133,185,259)

General RevenueProperty taxes 62,779,371 63,520,606 64,489,779 61,475,322 60,381,468 State aid not restricted to specific purposes 65,474,619 65,737,190 65,310,870 63,278,069 62,226,033 Federal sources - Unrestricted - - - - 3,396,898 Unrestricted state grants and contributions 2,253,268 2,238,873 2,230,346 2,212,809 - Investment earnings 2,136,682 2,520,195 1,931,986 1,371,090 482,437 Other 698,571 788,749 1,458,438 1,392,791 1,951,260

Total general revenue 133,342,511 134,805,613 135,421,419 129,730,081 128,438,096

Special Item - - - - (8,784,484)

Change in net position (6,145,073)$ 255,121$ 8,518,143$ 780,782$ (13,531,647)$

* Historically, approximately 50 percent of charges for services is for nutrition services and the balance is for community education tuition and facility usage charges.

Source: Farmington Public School District audited financial statements

June 30

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Financial Trend Information Changes in Governmental Net Position

Last Ten Fiscal Years

2011 2012 2013 2014 2015

93,196,238$ 93,536,609$ 94,544,880$ 93,402,687$ 95,922,327$ 58,420,931 56,592,666 56,068,389 54,103,272 55,576,921

3,820,318 3,607,330 3,676,910 3,648,056 3,676,318 2,006,621 2,117,510 2,030,460 1,972,380 1,799,480 1,234,414 1,277,959 1,453,986 1,351,112 1,441,845 2,358,627 2,178,688 2,584,156 1,682,306 2,313,319 2,870,672 2,993,638 3,041,878 3,054,974 3,012,856

163,907,821 162,304,400 163,400,659 159,214,787 163,743,066

185,666 179,451 152,904 141,332 155,792 481,660 325,541 398,305 384,303 386,105

2,523,645 2,337,041 2,248,048 2,177,921 2,220,997 759,090 727,394 668,356 657,129 651,087

1,034,647 981,483 1,164,022 1,126,506 1,135,108 36,650,588 35,132,402 32,699,534 32,930,138 33,771,843

41,635,296 39,683,312 37,331,169 37,417,329 38,320,932

(122,272,525) (122,621,088) (126,069,490) (121,797,458) (125,422,134)

57,793,086 52,972,802 52,169,541 50,140,673 47,981,086 67,066,383 66,742,219 68,638,365 67,506,547 68,748,701

2,741,173 101,444 - - - - - - - -

246,262 171,338 54,150 61,865 7,883 862,471 785,373 1,624,004 1,902,789 1,689,689

128,709,375 120,773,176 122,486,060 119,611,874 118,427,359

- - 1,119,517 - 467,256

6,436,850$ (1,847,912)$ (2,463,913)$ (2,185,584)$ (6,527,519)$

June 30

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2006 2007 2008 2009

General Fund:Reserved 1,256,885$ 2,605,550$ 1,238,991$ 1,788,231$ Unreserved 26,365,956 24,540,968 33,776,836 28,984,831

Nonspendable - - - -

Restricted - - - -

Committed - - - -

Assigned - - - -

Unassigned - - - -

Total General Fund 27,622,841$ 27,146,518$ 35,015,827$ 30,773,062$

All other governmental funds:Reserved, reported in:

Special Revenue Funds 225,238$ 207,882$ 43,011$ 39,065$ Capital Project Funds 7,006,838 1,255,342 176,238 1,917,877 Debt Service Funds 1,000,881 777,043 731,169 537,407

Unreserved, reported in:Special Revenue Funds 7,070,207 6,119,285 3,690,688 3,607,207 Capital Project Funds 6,143,272 5,466,103 5,574,676 4,798,195 Debt Service Funds - - - -

Nonspendable, reported in -

Special Revenue Funds - - - -

Restricted, reported in:

Special Revenue Funds - - - -

Debt Service Funds - - - -

Capital Projects Fund - bonded - - - -

Committed, reported in -

Capital Project Funds - - - -

Assigned - - - -

Unassigned - - - -

Total all other governmental funds 21,446,436$ 13,825,655$ 10,215,782$ 10,899,751$

Source: Farmington Public School District audited financial statementsNote: Years beginning with 2011 have been presented in accordance with GASB No. 54, which was effective July 1, 2010. Years prior to GASB No. 54 presented fund balance into two categories: reserved and unreserved. Reserved amounts were not available for spending or are legally restricted. Unreserved amounts contained designated funds, which were determined by the Board of Education or management, and undesignated funds, which contained all remaining funds.

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Financial Trend Information Fund Balances - Governmental Funds

Last Ten Fiscal Years

2010 2011 2012 2013 2014 2015

2,485,604$ - $ - $ - $ - $ - $ 20,806,567 - - - - -

- 2,201,374 1,770,361 1,113,025 835,743 661,116

- - - - - -

- 3,930,879 3,412,671 4,051,511 6,801,338 3,000,517

- 8,018,924 11,524,781 5,483,769 4,330,988 4,698,095

- 13,821,912 7,403,671 8,471,478 - -

23,292,171$ 27,973,089$ 24,111,484$ 19,119,783$ 11,968,069$ 8,359,728$

41,012$ - $ - $ - $ - $ - $ 858,932 - - - - - 557,736 - - - - -

3,412,588 - - - - - 4,707,552 - - - - -

- - - - - -

- 34,381 33,577 35,196 39,470 34,038

- 2,718,295 2,729,715 2,830,677 2,943,868 2,952,925

- 652,072 161,139 494,026 786,414 227,029

- - - - - 76,602,905

- 3,753,158 1,348,633 601,477 579,928 146,116

- - - - - -

- - - - - -

9,577,820$ 7,157,906$ 4,273,064$ 3,961,376$ 4,349,680$ 79,963,013$

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2006 2007 2008

RevenueLocal sources 71,167,847$ 72,357,730$ 73,829,784$ State sources 80,396,333 80,218,401 80,354,016 Federal sources 5,008,360 4,364,678 5,144,317 Interdistrict sources 15,224,655 17,343,384 18,493,107

Total revenue 171,797,195 174,284,193 177,821,224

ExpendituresCurrent:

Instruction 93,827,659 94,120,648 91,092,053 Support services 60,486,232 61,322,450 60,402,363 Community services 1,890,289 1,780,866 1,697,832 Nutrition services 3,603,064 3,864,834 3,932,541 Athletics 2,296,843 2,310,316 2,320,740

Debt service:Principal 5,275,000 5,525,000 5,805,000 Debt issuance costs - - - Interest 3,293,201 3,064,853 2,851,454

Intergovernmental payments 1,322,596 1,332,315 749,394 Capital outlay 19,231,731 9,564,119 4,259,778

Total expenditures 191,226,615 182,885,401 173,111,155

Excess of Revenue (Under) Over Expenditures (19,429,420) (8,601,208) 4,710,069

Other Financing Sources (Uses)Debt issuance - - - Premium on debt issued - - - Sale of capital assets 22,645 13,616 39,855 Transfers in 13,361,691 13,401,276 17,437,871 Transfers out (13,361,691) (13,401,276) (17,437,871) Payments from other districts - - - Payment to bond escrow agent - - -

Total other financing sources 22,645 13,616 39,855

Net Change in Fund Balances (19,406,775) (8,587,592) 4,749,924

Fund Balances - Beginning of year 68,476,052 49,069,277 40,481,685

Fund Balances - End of year 49,069,277$ 40,481,685$ 45,231,609$

Debt service as a percentage of noncapital expenditures 5.03% 5.26% 5.43%

Source: Farmington Public School District audited financial statements

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Financial Trend Information Changes in Fund Balances - Governmental Funds

Last Ten Fiscal Years

2009 2010 2011 2012 2013 2014 2015

69,477,371$ 67,589,057$ 65,032,708$ 59,203,322$ 58,180,291$ 56,401,936$ 54,255,170$ 77,739,909 75,454,052 78,833,538 80,024,841 82,047,166 81,213,142 83,101,032 9,677,723 11,310,338 10,576,783 6,675,500 5,718,440 5,707,257 5,731,381

17,509,716 16,962,427 15,676,746 14,565,989 12,923,811 12,682,208 -

174,404,719 171,315,874 170,119,775 160,469,652 158,869,708 156,004,543 143,087,583

95,726,635 97,015,401 90,810,497 90,714,416 91,818,639 92,780,320 92,034,829 61,319,924 62,000,776 56,670,108 54,791,172 54,251,823 53,564,499 53,105,932 1,413,738 1,356,136 1,215,179 1,257,702 1,433,219 1,329,693 1,424,828 4,002,917 3,997,493 3,807,614 3,584,696 3,658,731 3,646,676 3,676,318 2,418,962 2,349,801 2,006,621 2,117,510 2,030,460 1,972,380 1,799,480

5,995,000 5,480,000 5,645,000 5,830,000 6,025,000 6,350,000 6,150,000 - - - - 128,622 - 537,564

2,621,518 2,465,030 2,302,693 2,207,345 1,983,642 1,638,386 1,771,184 558,919 750,522 721,407 820,803 662,217 592,863 434,061

3,956,611 4,727,626 4,714,698 5,904,662 3,431,896 901,333 518,875

178,014,224 180,142,785 167,893,817 167,228,306 165,424,249 162,776,150 161,453,071

(3,609,505) (8,826,911) 2,225,958 (6,758,654) (6,554,541) (6,771,607) (18,365,488)

- - - - 11,180,000 - 81,050,000 - - - - 1,304,740 - 9,186,782

50,709 24,089 35,046 12,207 1,119,518 8,197 502,255 16,710,465 15,186,436 10,380,771 11,419,878 9,591,991 8,220,060 8,479,893

(16,710,465) (15,186,436) (10,380,771) (11,419,878) (9,591,991) (8,220,060) (8,479,893) - - - - - - 12,694,664 - - - - (12,353,106) - (13,063,221)

50,709 24,089 35,046 12,207 1,251,152 8,197 90,370,480

(3,558,796) (8,802,822) 2,261,004 (6,746,447) (5,303,389) (6,763,410) 72,004,992

45,231,609 41,672,813 32,869,991 35,130,995 28,384,548 23,081,159 16,317,749

41,672,813$ 32,869,991$ 35,130,995$ 28,384,548$ 23,081,159$ 16,317,749$ 88,322,741$

5.23% 4.77% 5.14% 5.27% 5.31% 5.21% 5.56%

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Real Property

Tax Year Residential Commercial Industrial

2005 2,878,902,380$ 920,238,630$ 266,753,550$ 294,764,930$ N/A2006 3,018,638,560 950,426,860 274,910,160 298,725,070 N/A2007 3,128,593,270 987,195,890 280,137,220 299,051,890 N/A2008 3,097,444,190 1,001,122,800 281,107,040 N/A 160,417,450$ 2009 2,852,923,100 1,006,481,180 286,807,880 N/A 156,459,620 2010 2,403,008,210 921,785,410 245,508,730 N/A 146,933,020 2011 2,204,586,330 866,304,300 143,820,720 N/A 141,735,540 2012 2,128,956,830 785,323,570 101,290,930 N/A 135,583,780 2013 2,152,620,080 731,842,410 92,365,090 N/A 137,119,430 2014 2,206,252,830 695,602,580 91,896,530 N/A 120,006,060

Note: Under Michigan law, the revenue base is taxable value. The property tax base in the School District is contingent upon the taxable property values. Taxable value increases are limited by variable caps and other restrictions, which generally cause taxable values to be at or below the state equalized values, which are primarily market-driven. Taxes levied in a particular "tax year" become revenue of the subsequent fiscal year.

* During fiscal year 2009, the State of Michigan revised the taxable value structure of the personal property tax base. This change was made to lessen property taxes on businesses within the state.

Source: Oakland County Form L-4028

Personal Property*

Commercial

Personal Property

Taxable Value by Property Type

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Revenue Capacity Information Taxable Value and Actual Value of Taxable Property

Last Ten Fiscal Years

Taxable Value by Property Type

N/A N/A 4,360,659,490$ 11.1596/19.9388 8,721,318,980$ 50.00N/A N/A 4,542,700,650 10.6511/19.7388 9,085,401,300 50.00N/A N/A 4,694,978,270 10.1784/19.8000 9,389,956,540 50.00

95,137,710$ 36,618,240$ 4,671,847,430 9.6915/19.8000 9,343,694,860 50.0090,453,690 37,452,570 4,430,578,040 10.1442/19.8000 8,861,156,080 50.0086,967,220 38,192,480 3,842,395,070 12.0278/20.1000 7,684,790,140 50.0078,913,080 43,622,360 3,478,982,330 12.3334/20.1800 6,957,964,660 50.0077,025,150 44,594,630 3,272,774,890 13.3810/20.5600 6,545,549,780 50.0075,384,170 48,422,550 3,237,753,730 13.0150/20.5600 6,475,507,460 50.0076,000,470 49,097,810 3,238,856,280 11.7472/20.2600 6,477,712,560 50.00

Taxable

Value as a

% of Actual

Value Total Value

Estimated

Actual Value

Tax Rate (mills)

Homestead/Non-

Homestead

Industrial

Personal

Property

Utility Personal

Property

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Millage Rates - Direct Farmington Public School District Taxes

Tax Year

Fiscal Year

Ended

June 30 Homestead

Non-

homestead Debt* Homestead

Non-

homestead

2005 2006 9.1596 17.9388 2.0000 11.1596 19.9388 2006 2007 8.8511 17.9388 1.8000 10.6511 19.7388 2007 2008 8.3784 18.0000 1.8000 10.1784 19.8000 2008 2009 7.8915 18.0000 1.8000 9.6915 19.8000 2009 2010 8.3442 18.0000 1.8000 10.1442 19.8000 2010 2011 9.9278 18.0000 2.1000 12.0278 20.1000 2011 2012 10.1534 18.0000 2.1800 12.3334 20.1800 2012 2013 10.8210 18.0000 2.5600 13.3810 20.5600 2013 2014 10.4550 18.0000 2.5600 13.0150 20.5600 2014 2015 9.4872 18.0000 2.2600 11.7472 20.2600

* Debt millage applies to homestead and nonhomestead property.

Sources: Assessment and tax roll certificates and warrants for West BloomfieldTownship, City of Farmington Hills, and City of Farmington

Operating Total Direct Taxes

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Revenue Capacity Information Direct and Overlapping Property Tax Rates

Last Ten Fiscal Years

Oakland

County

Oakland

Community

College

Oakland

Intermediate

School District

State

Education

City of

Farmington

City of

Farmington

Hills

Township

of West

Bloomfield

4.6461 1.5844 3.3690 6.0000 16.0019 11.7027 9.6569 4.6461 1.5844 3.3690 6.0000 16.0019 12.1972 9.5634 4.6461 1.5844 3.3690 6.0000 16.0019 12.1972 9.5894 4.7461 1.5844 3.3690 6.0000 15.4019 12.1972 9.5894 4.7461 1.5844 3.3690 6.0000 15.4019 12.1972 8.9774 4.7461 1.5844 3.3690 6.0000 16.0000 12.1972 9.0074 4.7461 1.5844 3.3690 6.0000 16.5856 12.2036 11.9347 4.9461 1.5844 3.3690 6.0000 16.5856 13.9362 12.2537 4.9461 1.5844 3.3690 6.0000 16.5856 13.9392 12.2550 4.0019 1.5844 3.3690 6.0000 16.5856 13.9394 12.2550

Overlapping Taxes

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Revenue Capacity Information Principal Property Taxpayers

2014

Taxable Value

Percentage

of Total

2005

Taxable Value

Percentage

of Total

1 Oakland Management Company 47,696,370$ 1.47 54,603,150$ 1.25 2 DTE Energy 31,017,310 0.96 38,254,360 0.88 3 Robert Bosch Corporation 29,064,940 0.90 45,220,920 1.04 4 Nissan Corporation 27,629,060 0.85 - - 5 FH Corporate Inv (Kojaian) 22,274,220 0.69 52,349,890 1.20 6 Green Hill Apartments 17,200,840 0.53 - - 7 Ramco/Lion Venture LP 13,808,630 0.43 - - 8 Aimco (Independence Green Apartments) 12,583,400 0.39 17,802,900 0.41 9 Hartman & Tyner 12,472,910 0.39 - -

10 Chrysler Financial Company 10,963,640 0.34 21,245,130 0.49 Nissan Corporation - - 28,233,170 0.65 Arboretum Development - - 20,552,550 0.47 Liberty Property Ltd. Partnership - - 20,270,400 0.46 Sherr Development Corporation - - 18,960,840 0.43 All others 3,014,144,960 93.05 4,043,166,180 92.72

Total 3,238,856,280$ 100.00 4,360,659,490$ 100.00

Source: Cities of Farmington and Farmington Hills

Taxpayer

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Revenue Capacity Information Property Tax Levies and Collections

Last Ten Fiscal Years

Tax Year

Fiscal Year

Ended

June 30 Total Levy

Current

Collections

Percent

Collected

Delinquent

Collections

Total Tax

Collections

Percent of

Levy

Collected

2005 2006 62,760,794$ 62,642,642$ 99.81 - 62,515,317$ 99.60 2006 2007 63,497,573 63,362,114 99.78 - 63,129,107 99.42 2007 2008 64,328,248 64,079,736 99.61 - 63,868,859 99.29 2008 2009 61,463,059 61,297,437 99.73 - 60,964,949 99.19 2009 2010 60,356,441 60,208,132 99.75 - 59,400,205 98.42 2010 2011 57,759,703 57,643,665 99.80 24$ 56,983,596 98.66 2011 2012 52,916,609 52,764,189 99.71 1,398 52,868,451 99.91 2012 2013 52,079,493 51,994,900 99.84 4,548 52,055,771 99.95 2013 2014 50,765,606 50,678,031 99.83 41,439 50,719,470 99.91 2014 2015 47,485,452 47,382,532 99.78 - 47,382,532 99.78

Source: Farmington Public School District audited financial statements

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2006 2007 2008 2009

Governmental ActivitiesGeneral obligation bonds 75,875,000$ 70,350,000$ 64,545,000$ 58,550,000$ Less pledged debt service funds - - - -

Net general bonded debt 75,875,000 70,350,000 64,545,000 58,550,000

Installment purchase agreements - - - - Capital leases - - - -

Total debt of the School District 75,875,000 70,350,000 64,545,000 58,550,000

Estimated actual value of taxable property 8,721,318,980 9,085,401,300 9,389,956,540 9,343,694,860

Net general bonded obligation debtas a percentage of estimated actualvalue of taxable property 0.87% 0.77% 0.69% 0.63%

Total population 91,000 91,000 91,000 89,500

Total debt per capita 834$ 773$ 709$ 654$

Per capita personal income 34,293$ 34,293$ 34,293$ 34,293$

Total debt to per capita personal income 2,213:1 2,051:1 1,882:1 1,707:1

Note: If personal income is unavailable, it is acceptable to use taxable value.

Sources: Farmington Public School District audited financial statements Population information obtained from Southeastern Michigan Council of Governments

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Debt Capacity Information Ratios of Bonded Debt Outstanding

Last Ten Fiscal Years

2010 2011 2012 2013 2014 2015

53,070,000$ 47,425,000$ 41,595,000$ 34,925,000$ 28,575,000$ 90,170,000$ - - - - - -

53,070,000 47,425,000 41,595,000 34,925,000 28,575,000 90,170,000

- - - - - - - - - - - -

53,070,000 47,425,000 41,595,000 34,925,000 28,575,000 90,170,000

8,861,156,080 7,684,790,140 6,957,964,660 6,545,549,780 6,475,507,460 6,477,712,560

0.60% 0.62% 0.60% 0.53% 0.44% 1.39%

89,500 89,500 89,500 83,700 84,300 84,300

593$ 530$ 465$ 417$ 339$ 1,070$

34,293$ 34,293$ 37,187$ 37,187$ 37,187$ 37,187$

1,548:1 1,383:1 1,119:1 939:1 768:1 2,425:1

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Debt Capacity Information Direct and Overlapping Governmental Activities Debt

June 30, 2015

Governmental Unit

Debt

Outstanding

Estimated

Percent

Applicable

Estimated Share

of Overlapping

Debt

City of Farmington 50,450,000$ 100.00% 50,450,000$ City of Farmington Hills 21,535,000 92.72% 19,967,252 Township of West Bloomfield 41,274,844 3.45% 1,423,982 Oakland County 426,396,226 6.48% 27,630,475 Oakland Community College 2,355,000 6.52% 153,546 Oakland Intermediate School District 54,540,000 6.50% 3,545,100

Total overlapping debt 596,551,070 103,170,355

Direct School District debt 90,170,000 90,170,000

Total direct and overlapping debt 686,721,070$ 193,340,355$

Source: Michigan Advisory Council of Michigan, May 2015

The share of overlapping debt is determined by taking the amount of taxable value in eachjurisdiction that is within the boundaries of the School District as a percentage of thetotal taxable value of that jurisdiction. That percentage is then applied to the direct tax-supported debt of the jurisdiction to determine the School District's overlapping share.Only tax-supported debt is included in the overlapping debt.

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2006 2007 2008 2009

Calculation of debt limit:State equalized valuation (SEV) 5,011,735,710$ 5,149,032,060$ 5,223,211,550$ 5,017,437,570$ 15% of SEV* 751,760,357 772,354,809 783,481,733 752,615,636

Calculation of debt subject to limit:Total debt 75,875,000 70,350,000 64,545,000 58,550,000 Less debt not subject to limit -

State qualified debt issuance (75,875,000) (70,350,000) (64,545,000) (58,550,000)

Net debt subject to limit** - - - -

Legal debt margin 751,760,357$ 772,354,809$ 783,481,733$ 752,615,636$

Net debt subject to limit as a percent of debt limit 0.00% 0.00% 0.00% 0.00%

* Public Act No. 451 of Michigan 1976, Sec. 1351A provides debt limits as follows: The bonded indebtednessof a school district shall not exceed 15 percent of all assessed valuation of the district. Bonds not includedin the computation of the legal debt margin are:

1. Defeased bonds 2. Any bond qualified under Article IX, Section 16 of the 1963 Michigan Constitution 3. Deficit budget bonds as authorized by Sec. 1356

**Based upon the strength of the School District's credit rating, along with a projected increase in taxable values in the foreseeable future, the School District selected the non-qualified bond option; however, it still met all of the requirements of the qualification process.

Source: School District audited financial statements

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Debt Capacity Information Legal Debt Margin

Last Ten Fiscal Years

2010 2011 2012 2013 2014 2015

4,560,420,200$ 3,901,601,510$ 3,508,724,740$ 3,306,721,310$ 3,281,856,510$ 3,458,703,200$ 684,063,030 585,240,227 526,308,711 496,008,197 492,278,477 518,805,480

53,070,000 47,425,000 41,595,000 34,925,000 28,575,000 90,170,000

(53,070,000) (47,425,000) (41,595,000) (34,925,000) (28,575,000) (9,120,000)

- - - - - 81,050,000

684,063,030$ 585,240,227$ 526,308,711$ 496,008,197$ 492,278,477$ 437,755,480$

0.00% 0.00% 0.00% 0.00% 0.00% 15.62%

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Demographic and Economic Information Demographic and Economic Statistics

Last Ten Fiscal Years

Fiscal Year Population

Total Personal

Income

(in thousands)

Per Capita

Personal Income

Unemployment

Rate

2006 91,000 3,120,663$ 34,293$ 4.70% 2007 91,000 3,120,663 34,293 5.00% 2008 91,000 3,120,663 34,293 5.70% 2009 89,500 3,069,224 34,293 10.00% 2010 89,500 3,069,224 34,293 11.27% 2011 89,500 3,069,224 34,293 9.02% 2012 89,500 3,328,237 37,187 7.53% 2013 83,700 3,112,552 37,187 7.38% 2014 84,300 3,134,864 37,187 6.26% 2015 84,300 3,134,864 37,187 3.73%

Sources: U.S. Bureau of the Census, Census 2000 Michigan Department of Labor and Economic Growth Southeast Michigan Council of Governments

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Demographic and Economic Information Principal Employers

Taxpayer

2015

Employees

Percentage of

Total

Employment

2006

Employees

Percentage of

Total

Employment

Botsford Hospital (Beaumont Health) 2,634 2.9% 2,116 2.9%Robert Bosch Corporation 1,600 1.7% 1,400 1.9%Farmington Public School District 1,372 1.5% 1,698 2.3%Quicken Loans 1,000 1.1% - - Nissan Technical Center North America 1,151 1.3% 1,050 1.4%TD Auto Finance LLC 900 1.0% - - Cengage Learning (Gale) 850 0.9% - - Global Automotive Systems, LLC - - 999 1.4%DaimlerChrysler Services North America - - 953 1.3%MAHLE Industries, Inc. 850 0.9% - - Harman Automotive Systems 700 0.8% - - TRW Automotive Electronics 600 0.7% 589 0.8%Trinity Health - - 900 1.2%Thompson Gale - - 790 1.1%Sprint Nextel Corporation - - 776 1.1%

Total principal employers 11,657 11,271

Total employment 92,066 73,985

Sources: City of Farmington Hills website Oakland County Southeast Michigan Council of Governments Farmington Public School District

Note: Total employment information is obtained from the Bureau of Labor Statistics.

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Function/Program 2006 2007 2008 2009 2010

General government:Instruction 1,015 987 935 943 953 Support services 604 580 551 567 579 Community service 6 5 5 5 5 Athletics 2 2 2 2 2 Food service 71 71 71 71 71

Total 1,698 1,645 1,564 1,588 1,610

Source: Farmington Public School District Personnel Department

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Operating Information Full-time Equivalent School District Employees

Last Ten Fiscal Years

2011 2012 2013 2014 2015

841 838 856 838 804 480 486 486 468 445

4 4 4 4 3 2 2 2 2 2

69 69 69 69 69

1,396 1,399 1,417 1,381 1,323

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Operating Information Operating Indicators Last Ten Fiscal Years

Year

Enrollment

Operating

Expenditures

Cost per

Pupil

Operating

Revenue

Revenue per

Pupil

Total

Teaching

Staff

Percentage of

Students

Qualifying for

Free/Reduced

Meals

Average

Teacher

Salary

2006 12,162 146,897,878$ 12,078$ 139,406,917$ 11,462$ 940 10.75% 67,298$ 2007 12,023 145,741,496 12,121.89 140,273,367 11,667.09 907 12.62% 70,917 2008 12,018 140,920,297 11,725.77 142,211,296 11,833.19 897 13.61% 71,254 2009 11,908 148,411,803 12,463.20 140,526,434 11,801.01 906 15.50% 74,526 2010 11,832 150,653,406 12,732.71 138,003,848 11,663.61 908 19.23% 75,267 2011 11,567 142,196,852 12,293.32 138,989,831 12,016.07 793 22.72% 78,677 2012 11,335 139,722,381 12,326.63 131,000,331 11,557.15 800 23.80% 76,621 2013 11,149 140,796,620 12,628.63 130,457,034 11,701.23 820 23.08% 75,303 2014 10,776 143,417,384 13,308.96 129,848,413 12,049.78 794 23.68% 75,930 2015 10,329 141,740,089 13,722.54 129,912,019 12,577.41 762 23.51% 76,625

Sources: Farmington Public School District audited financial statementsMichigan Department of Education Bulletin 1014

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Function/Program 2006 2007 2008 2009 2010 2011

Instructional buildings:Elementary:

Number of buildings 13 13 13 13 13 9 Square footage 640,831 640,831 640,831 640,831 640,831 459,488 Capacity 5,325 5,325 5,325 5,325 5,325 4,389 Enrollment* 4,985 4,945 4,879 4,812 4,880 3,879

Upper Elementary:Number of buildings - - - - - 2 Square footage - - - - - 209,452 Capacity - - - - - 1,830 Enrollment* - - - - - 1,655

Middle:Number of buildings 4 4 4 4 4 2 Square footage 429,172 429,172 429,172 429,172 429,172 232,200 Capacity 3,124 3,124 3,124 3,124 3,124 1,848 Enrollment* 2,794 2,724 2,651 2,720 2,654 1,752

High:Number of buildings 3 3 3 3 3 3 Square footage 734,412 734,412 734,412 734,412 734,412 734,412 Capacity 3,856 3,856 3,856 3,856 3,856 3,856 Enrollment* 3,921 3,949 4,089 3,984 4,054 4,033

Other:Number of buildings 6 6 6 6 6 4 Square footage 147,542 147,542 147,542 147,542 147,542 112,532 Capacity 755 755 755 755 755 605 Enrollment* 556 547 575 488 379 330

Administrative:Number of buildings 4 4 4 4 4 3 Square footage 139,853 139,853 139,853 139,853 139,853 77,588

Transportation:Number of garages 1 1 1 1 1 1 Buses 96 96 96 96 96 95

Athletics:Football/Soccer fields 15 15 15 15 15 15 Running tracks 5 5 5 5 5 5 Baseball/Softball 31 31 31 31 31 31 Swimming pools 3 3 3 3 3 3 Playgrounds 17 17 17 17 17 14

* Enrollment is based upon the fall head count of pupils.Source: Farmington Public School District

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Operating Information Capital Asset Information

Last Ten Fiscal Years

2012 2013 2014 2015

9 9 9 9 459,488 459,488 459,488 459,488

4,389 4,389 4,389 4,389 3,773 3,643 3,607 3,431

2 2 2 2 209,452 209,452 209,452 209,452

1,830 1,830 1,830 1,830 1,715 1,633 1,523 1,408

2 2 2 2 232,200 232,200 232,200 232,200

1,848 1,848 1,848 1,848 1,684 1,704 1,691 1,611

3 3 3 3 734,412 734,412 734,412 734,412

3,856 3,856 3,856 3,856 3,944 3,950 3,719 3,639

4 4 4 4 112,532 112,532 112,532 112,532

605 605 605 605 319 300 298 287

3 3 3 3 77,588 77,588 77,588 77,588

1 1 1 1 96 96 96 96

15 15 15 15 5 5 5 5

31 31 31 31 3 3 3 3

14 14 14 14

Page 122: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

32500 Shiawassee Street

Farmington, Michigan 48336

248.489.3349 | Fax 248.489.3314

Web Site: www.farmington.k12.mi.us

E-mail: [email protected]

Follow us on:

www.facebook.com/FarmingtonPublicSchools

https://twitter.com/fpsinformation

Points of Pride

• Farmington Public Schools’ students consistently score above state and

national averages on the American College Test (ACT), Scholastic Assessment

Test (SAT) and the Michigan Education Assessment Program (MEAP).

• Students regularly earn honors as AP Scholars, All State Academic winners

and National Merit Award winners. Most recently, nine students earned the distinction of

being named National Merit Scholars, and two were finalists for National Achievement Scholarships.

• Students from around the District excel in State and National competitions like

WordMasters, PTA Reflections and Math Pentathlon.

— Approximately 713 students took Advanced Placement

exams and 66 percent qualified for college credit on at least

one exam in 2013 - 2014. This ultimately saves hundreds of

dollars of college tuition for families.

— The three comprehensive high schools’ musical groups

annually compete and win state and national honors.

— Students have the opportunity to participate in a wide

variety of athletics. Many of the teams have earned

divisional, regional and state championship titles.

— High school students can participate in the District’s student-

run television studio, TV-10, which just celebrated 32 years of

operation.

— In 2014, Farmington Public Schools graduated 865

students; approximately 93 percent went on to a four-year

university, community college or technical school.

Students

• Involved and supportive parents

are one of the many strengths of

Farmington Public Schools. Parents

are involved in their schools and

participate in PTAs/PTSAs, booster

groups, the Farmington African Amer-

ican Parent Network (FAAPN), Proud

Dads Club and other parent groups.

• Since 1996, the City of Farmington

Hills, in partnership with the City

of Farmington, Farmington Public

Schools and the Farmington Family

YMCA, has operated After School

Youth Centers which have sup-

ported more than 8,000 students

between the ages of nine through 15.

Community

The Education Foundation is

a community-based organiza-

tion that provides financial and

volunteer support to Farming-

ton Public Schools. Community

contributions to the Foundation

have enabled the Foundation

to award more than $130,000

in grants for 184 projects that

have touched every school, in

the form of technology, extra-

curricular enrichment, the arts

and scholastic achievement.

2014-2015

• Since June 2005 through August

2014, Farmington Public Schools

has saved $10.8 MILLION in utility

costs by reducing electricity by

37% and natural gas consumption

by 36%. For the 2013-2014 fiscal

year. The District saved over $1.1

MILLION alone!

• Every school in the District has

a student-led green team includ-

ing our Early Childhood Programs;

17 of 18 of our schools have been

recognized as Michigan Green

Schools.

The District is home to two Milken

National Educator Teacher award

winners.

– Since 1989, 20 Farmington Public Schools’

teachers have been named Oakland County

Outstanding Teachers of the Year and nine

Farmington Public Schools’ support staff have

been named Oakland County’s Betty Campion

Support Persons of the Year.

Staff

– More than 85% of Farmington Public Schools’

teachers hold advanced degrees.

The Niche Ranking

The District recently placed 50th

on the Niche list of Michigan’s best

school districts (17th among metro

Detroit schools) with an A- overall

grade.

20

s.

Page 123: 2015Farmington Public School District • Farmington, MI00101 · Farmington Public School District is a suburban school district located in the cities of Farmington and Farmington

Farmington Public

Schools was one of

477 school districts

in the United States and Canada that

simultaneously achieved increases in access

to Advanced Placement courses for a

broader number of students and also

maintained or improved the rate at which

their AP students earned scores of 3 or

higher on an AP Exam.*

*District has received honors for multiple years.

AP District

Honor Roll

All individual K-12 schools and the District are fully

accredited by AdvancED. AdvancED

conducts on-site external reviews of

schools and districts to ensure that

all learners realize their full potential.

• The Association of School Business Officials International (ASBO) for

the 18th year in a row awarded the Meritorious Budget Award

for Excellence in the preparation and issuance of school system

annual budget to Farmington Public Schools. The District has also

earned ASBO’s Certificate of Excellence in Financial Reporting for

the past 18 years.

• National PTA has recognized Lanigan Elementary School

and the Lanigan PTA as a National PTA School of Excellence

for building effective family-school partnerships. Lanigan is the

only school in Michigan to earn this national recognition for

2014-2016.

• The Farmington PTA Council recently won the PTA Council

Award of Excellence, as well as a Certificate of Success

for partnering with business members.

• Elementary, Upper Elementary, Middle School and High

School Newcomer Centers provide linguistic

and educational supports to meet the needs of newly arrived

immigrants to the District.

• The District serves families who represent more than

102 languages.

• The District is a member of the National Minority Student

Achievement Network (MSAN) which focuses on raising

achievement and closing achievement gaps.

• Alameda Early Childhood Center and Farmington

Community School are accredited by the National

Association for the Education of Young Children (NAEYC).

7Over the years, seven

Farmington Public Schools

have been named Michigan

Blue Ribbon Exemplary

Schools with three also being

named

National

Blue

Ribbon

Exemplary

Schools.

District Mission Statement:

Farmington Public Schools, together with

our community, will engage every student in a quality learning experience,

empowering each student to become a thoughtful, contributing citizen

in a changing world.

District

Points of Pride

The District is in its fourth year of having an Interna-

tional Baccalaureate (IB) program with more than 420

students participating on some level. In Spring of 2013,

the International Baccalaureate program achieved

World School designation, the highest

endorsement possible.

The District serves approximately 10,000 students in Farmington, Farmington Hills and a portion of West Bloomfield.

Longacre Elementary School has been

awarded the distinction

and honor of being

named a Leader in Me

LIGHTHOUSE School.

Longacre is the fifth

school in the State of

Michigan that has met

the rigorous academic

and depth of implementa-

tion criteria involved in

receiving this honor.

years, seven

The National Association of Music Merchants (NAMM) Foundation

has recognized Farmington Public Schools for its outstanding

commitment to music education with a Best

Communities for Music Education

(BCME) designation. Farmington Public

Schools joins 388 districts across the

country in receiving this prestigious

distinction in 2015.

2014-2015