Audited Financial Statements

and Other Financial Information

June 30, 2015

DELTA COLLEGE

AUDITED FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION

JUNE 30, 2015

CONTENTS

Audited Financial Statements Management’s Discussion and Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-12 Report of Independent Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13-15 Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Statements of Revenue, Expenses and Changes in Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18-19 Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20-45 Required Supplementary Information Schedule of Proportionate Share of Net Pension Liability and Contributions for Michigan Public School Employees’ Retirement System (MPSERS), and Notes to Required Supplementary Information

. . . . . . . . . . . . . . . . . . . . .

46

Supplemental Schedules of Other Financial Information Consolidating Balance Sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Consolidating Statement of Revenue, Expenses and Changes in Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 Details of Certain General Fund Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 Details of General Fund Operating Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50-52 Details of Designated Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 Details of Auxiliary Activities Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54 Details of Expendable Restricted Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Details of Endowment Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56-59

1

MANAGEMENT’S DISCUSSION AND ANALYSIS

DELTA COLLEGE YEAR ENDED JUNE 30, 2015 The discussion and analysis of the financial statements of Delta College (the College) provides an overview of the College’s financial activities for the years ended June 30, 2015, 2014 and 2013. Management has prepared the financial statements and the related footnote disclosures along with the discussion and analysis. Responsibility for the completeness and fairness of this information rests with the College’s management. Using This Report These financial statements are prepared in accordance with the Governmental Accounting Standards Board (GASB) Statement No. 35, Basic Financial Statements - and Management’s Discussion and Analysis - for Public Colleges and Universities. The financial statements are prepared under the accrual basis of accounting, whereby revenues and assets are recognized when the service is provided and expenses and liabilities are recognized when others provide the service, regardless of when cash is exchanged. Capital expenditures are capitalized on the Balance Sheet instead of recording as an expense, and depreciation is recorded. Activities are reported as either operating or nonoperating in accordance with the GASB Statement No. 35. Charges for services are recorded as operating revenues. Essentially all other types of revenue, including state appropriations, property tax levies and Pell federal grant revenue are nonoperating. A public community college’s reliance on state funding, local property taxes and Pell federal grant assistance to students will result in reporting an operating deficit. This annual financial report complies with these requirements and includes this management’s discussion and analysis, the report of independent auditors, the financial statements, notes to financial statements, required supplementary information, and supplemental information similar to commercial enterprises and private-sector institutions. Over time, increases or decreases in net position provide one indication of the financial health of an organization. To assess the overall health of the College, many other non-financial factors also need to be considered such as trends in enrollment, condition of facilities, attention to workforce needs, success of graduates, and the strength of the faculty and staff. Financial Highlights During the year ended June 30, 2015, the College implemented 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. The provisions of these new standards resulted in the College recognizing its calculated share of the pension liability and related expenses and deferred inflows and outflows for the Michigan Public School Employees’ Retirement System (MPSERS). The College’s initial net pension liability and deferred outflows of resources effective July 1, 2014, respectively, were $85.8 million and $4.2 million, for a reduction in beginning unrestricted net position of $81.6 million. The 2015 activity included a reduction in the net pension liability of $5.1 million, which included negative pension expense of $78,000 and a decrease in deferred outflows of resources of $5.0 million. As of June 30, 2015, the impact of these standards resulted in a reduction in unrestricted net position for the College of $81.5 million. Excluding the significant and distorting effects of implementing the MPSERS pension adjustments in accordance with aforementioned GASB Statements No. 68 and No. 71, the College’s financial position improved during both fiscal years ended June 30, 2015 and 2014, respectively, with net position increasing by $7.0 million and $7.6 million. This equates to a 4% annual increase in net position in 2015 and a 5% annual increase in 2014.

2

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued

DELTA COLLEGE YEAR ENDED JUNE 30, 2015

Financial Highlights - Continued For 2015, the College had a $3.8 million increase in restricted net position, primarily due to the $4.0 million gift from the Dow Foundation for the STEM Explorer Program vehicle and endowment, a $4.0 million increase in unrestricted net position from operations before accounting for the pension effects of GASB Statements No. 68 and No. 71, and a $800,000 decrease in investment in capital assets. Enrollment continued to decrease this year by approximately 10,600 credit hours, or 5.1%, and the College experienced a decrease in Pell grant revenue of $1.5 million; however, a mid-year academic tuition increase held the decline in total tuition and fee revenue to $550,000, the majority of which related to a decrease in Delta College Corporate Services training. The Auxiliary Activities Fund increased by $630,000, of which $571,000 was net income generated by the Bookstore. The 2014 increase included a $5.2 million increase in investment in capital assets primarily related to the Health Professions Building (F-Wing) Renovation Project. This project broke ground in the spring of 2013 and was substantially completed at the end of August 2013 for the start of the fall semester. There was also a $1.7 million increase in donor-restricted endowments and a $1.0 million increase in unrestricted net position, both respectively related to gains on endowment and quasi-endowment investments. Enrollment decreased again this year by over 15,500 credit hours, or 6.9%, and the College experienced decreases in total tuition and fee revenue of $617,000 and Pell grant revenue of $1.8 million. The Auxiliary Activities Fund increased by $430,000, almost entirely from net income generated by the Bookstore. The following chart provides a graphical breakdown of net position by category for the fiscal years ending June 30, 2015, 2014 and 2013, in millions:

-$100.0-$50.0

$0.0$50.0

$100.0$150.0$200.0

2015 2014 2013

99.7 100.5 95.3

4.9 3.6 3.9 14.6 12.1 10.4

53.7 49.7 48.7-81.5

Net Investment in Capital Assets Restricted - Expendable

Restricted - Endowments Unrestricted - Other

Unrestricted - MPSERS Liability

3

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued DELTA COLLEGE YEAR ENDED JUNE 30, 2015

Summary of Selected Financial Data

Following is a summary of the major components of the financial position of the College as of June 30, 2015, 2014 and 2013, in millions:

June 30, 2015: During the year ended June 30, 2015, total assets increased by $7.4 million and total liabilities increased by $81.1 million. The primary change in assets was reflected by a $6.0 million increase in the combination of cash and cash equivalents and short-term investments, and another $1.3 million increase in appropriation receivable from the State of Michigan related to the final payments due on completion of the Health Professionals Building Renovation Project. The $81.1 million increase in liabilities was due to the $80.7 million MPSERS net pension liability recognized beginning in 2015. June 30, 2014: During the year ended June 30, 2014, total assets increased by $4.9 million and total liabilities decreased by $2.7 million. The primary change in assets was reflected by a $5.2 million increase in investment in capital assets. The $2.7 million decrease in total liabilities was due to a decrease in accounts payable of approximately the same amount, and offsets the $2.8 million increase experienced in 2013. These changes were due to the completion of the Health Professions Building Renovation Project, as previously discussed.

2015

2014

2015-2014 Change

2013

2014-2013 Change

Current Assets

$ 53.9

$ 45.3

$ 8.6

$ 50.1

$ (4.8)

Long-Term Assets: Capital Assets, Net of Depreciation 99.7 100.5 (.8) 95.3 5.2 Other 28.0 28.4 (.4) 23.9 4.5

Total Assets 181.6 174.2 7.4 169.3 4.9

Current Liabilities 8.7 8.3 0.4 11.0 (2.7) Non-Current Liabilities 80.7 - 80.7 - -

Total Liabilities 89.4 8.3 81.1 11.0 (2.7)

Deferred Inflows of Resources .8 - .8 - -

Net Position:

Net Investment in Capital Assets 99.7 100.5 (.8) 95.3 5.2

Restricted – Expendable 4.9 3.6 1.3 3.9 (.3) Restricted – Endowments 14.6 12.1 2.5 10.4 1.7

Unrestricted (27.8) 49.7 (77.5) 48.7 1.0

Total Net Position $ 91.4 $ 165.9 $ (74.5) $ 158.3 $ 7.6

4

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued DELTA COLLEGE YEAR ENDED JUNE 30, 2015 Summary of Selected Financial Data - Continued The following summarizes the major components of the College’s operating results for the years ended June 30, 2015, 2014 and 2013, in millions:

2015

2014

2015-2014 Change

2013

2014-2013 Change

Operating Revenue: Tuition and Fees $ 22.4 $ 23.0 $ (.6) $ 23.6 $ (.6) Grants and Contracts 5.9 4.7 1.2 4.9 (.2) Public Broadcasting Gifts .6 .7 (.1) .7 - Auxiliary Services 5.4 5.7 (.3) 6.0 (.3) Other .9 1.3 (.4) 1.4 (.1)

Total Operating Revenue 35.2 35.4 (.2) 36.6 (1.2) Operating Expenses:

Instruction 40.3 38.7 1.6 38.7 - Public Services 2.6 2.6 - 2.7 (.1) Instructional Support 7.8 7.7 .1 7.8 (.1) Student Services 22.7 24.2 (1.5) 26.4 (2.2) Institutional Administration 8.2 8.2 - 7.8 .4 Operation and Maintenance of Facilities 7.2 9.9 (2.7) 6.6 3.3 Depreciation 4.6 4.5 .1 4.1 .4

Total Operating Expenses 93.4 95.8 (2.4) 94.1 1.7

Operating Loss (58.2) (60.4) 2.2 (57.5) (2.9) Nonoperating Revenue (Expenses)

State Appropriations 17.3 15.8 1.5 14.5 1.3 Property Taxes 23.0 22.8 .2 22.6 .2 Pell Federal Grant Revenue 17.0 18.5 (1.5) 20.3 (1.8) Other 4.5 3.5 1.0 2.0 1.5

Net Nonoperating Revenue (Expenses) 61.8 60.6 1.2 59.4 1.2

(continued on next page)

5

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued DELTA COLLEGE YEAR ENDED JUNE 30, 2015 Summary of Selected Financial Data - Continued

(continued from previous page)

2015

2014 2015-2014

Change

2013

2014-2013 Change

Other Revenue Capital Gifts, Grants and Appropriations $ 2.1 $ 7.1 $ (5.0) $ 1.6 $ 5.5 Additions to Permanent Endowments 1.4 .3 1.1 .3 -

Total Other Revenue 3.5 7.4 (3.9) 1.9 5.5 Increase in Net Position 7.1 7.6 (.5) 3.8 3.8 Net Position – Beginning of Year Beginning of Year 165.9 158.3 7.6 154.5 3.8 Adjust for Change in Accounting Principle (81.6) - (81.6) - -

Net Position – Beginning of Year, as Restated 84.3 158.3 (74.0) 154.5 3.8

Net Position – End of Year

$ 91.4

$ 165.9

$ (74.5)

$ 158.3

$ 7.6

Operating Revenue

Operating revenue includes all transactions that result in the sales and/or receipts from providing goods and services, such as tuition and fees, food service and bookstore operations. In addition, certain federal, state, and private gifts and grants are considered operating if they are not for capital purposes and are considered a contract for services or are program-specific. June 30, 2015: Operating revenue changes are highlighted by the following factors for the year ended June 30, 2015:

The 2015 academic in-district tuition rate increased by $3.20 per credit hour for fall 2014 semester, and a mid-year increase raised it another $2.80, for an average increase of around 5.1%. Enrollment totaled 198,701 credit hours, which was a decrease of 5.1% from 2014. The net impact of these changes caused a $134,000 decrease in tuition and fee revenues generated by academic programs, net of scholarship allowance. Additionally, as noted below, related Pell grant (non-operating) revenues and corresponding operating expenses also decreased by $1.5 million.

Of the $22.4 million in tuition and fees, which was net of $7.7 million in offsetting scholarship allowances, and the $5.9 million in grants and contracts operating revenue, Corporate Services provided administration, education and training of $2.4 million and $2.9 million, respectively. Corporate Services tuition and fee revenue decreased by $400,000 from the prior year, which was offset by a $500,000 increase in grants and contracts revenue.

The Auxiliary services revenue consists primarily of sales in the Bookstore of $5.4 million, which had offsetting scholarship allowances approximating $1.5 million, Food Services of $1.1 million, and Fitness & Recreation Center of $323,000. Bookstore sales dropped by $403,000, or 7%, Food Services sales declined by 3%, and Fitness & Recreation Center revenue decreased by 7% during the year.

6

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued DELTA COLLEGE YEAR ENDED JUNE 30, 2015 Operating Revenue - Continued June 30, 2014: Operating revenue changes are highlighted by the following factors for the year ended June 30, 2014:

The 2014 academic in-district tuition rate increased by $2.50 per credit hour, a 2.9% increase. Enrollment totaled 209,342 credit hours, which was a decrease of 6.9% from 2013. The net impact of these changes caused a $375,000 decrease in tuition and fee revenues generated by academic programs, net of scholarship allowance. Additionally, as noted below, related Pell grant (non-operating) revenues and corresponding operating expenses also decreased by $1.8 million.

Of the $23.0 million in tuition and fees, which was net of $7.7 million in offsetting scholarship allowances, and the $4.7 million in grants and contracts operating revenue, Corporate Services provided administration, education and training of $2.8 million and $2.4 million, respectively. Corporate Services tuition and fee revenue decreased by $200,000 and grants and contracts revenue remained unchanged from the prior year.

The Auxiliary services revenue consists primarily of sales in the Bookstore of $5.8 million, which had offsetting scholarship allowances approximating $1.6 million, Food Services of $1.2 million, and Fitness & Recreation Center of $348,000. Bookstore sales dropped by $375,000, or 6%, Food Services sales remained unchanged, and Fitness & Recreation Center revenue decreased by 6% during the year.

The following is a graphic illustration of operating revenues by source for the years ended June 30, 2015, 2014 and 2013:

64%

1%

6%

11%16%

2%

2013

Tuition & Fees State Grants

Other Operating Federal Grants

Auxiliary Local Grants

65%

1%

5%

10%16%

3%

2014

Tuition & Fees State Grants

Other Operating Federal Grants

Auxiliary Local Grants

64%

2%

4%

12%15%

3%

2015

Tuition & Fees State Grants

Other Operating Federal Grants

Auxiliary Local Grants

7

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued DELTA COLLEGE YEAR ENDED JUNE 30, 2015

Operating Expenses

Operating expenses are all the costs necessary to perform and conduct the programs and primary purposes of the College. June 30, 2015: Operating expense changes are highlighted by the following factors for the year ended June 30, 2015:

Base salary increases approximated 1.7%, and employee contribution toward medical insurance remained at 17.5%. Under the self-funded employee medical coverage contract with Blue Cross Blue Shield (BCBS) of Michigan, the College pays for actual claims incurred, up to a maximum $125,000 per claim, a stop-loss insurance premium for claims in excess of $125,000, and a monthly administrative fee. The College experienced increased claims during 2015, which resulted in an increase in employee health insurance expense of $576,000.

Public Act 300 of 2012 enacted by the State of Michigan legislature made significant reforms to the Michigan Public School Employees’ Retirement System (MPSERS) that are designed to reduce overall benefit costs, but the cost reduction impact of the changes will not be experienced by employers for many years. During 2015, the College’s overall retirement expense for MPSERS was $10.6 million, an increase of $1.1 million from 2014. Of this total, $7.9 million was for contributions to MPSERS, and $2.7 million was due to the annual Unfunded Actuarial Accrued Liability (UAAL) Rate Stabilization Payment that was appropriated by legislature. The UAAL Rate Stabilization Payment was paid to the College for pass-through to the MPSERS for purposes of offsetting the UAAL cap that was put into place via Public Act 300 of 2012. The $2.7 UAAL retirement expense was directly offset by the same amount of increase in state aid non-operating revenue, as noted below. The College also recorded an accrual adjustment reducing annual pension expense by $78,000 due to implementation of the new GASB Statement No. 68. Refer to Note 6 for more information regarding the College’s retirement plans.

Overall operating expenses decreased by $2.4 million. This decrease was primarily related to a $2.7 million decrease in operation and maintenance of facilities due to substantial completion of the Health Professions Building renovation project in the prior year. There was also a $1.5 million reduction in Pell grants expensed under the student services functional category, which was offset by a $1.6 million increase in instruction expenses primarily related to the restricted gifts, grants and contracts received for STEM and other vocational educational programs.

June 30, 2014: Operating expense changes are highlighted by the following factors for the year ended June 30, 2014:

Base salary increases approximated 1.7%, and employee contribution toward medical insurance increased to 17.5%. In conjunction with the self-funded employee medical coverage contract with BCBS of Michigan, the College reduced health insurance expense by $170,000 in 2014.

Public Act 300 of 2012 enacted by the State of Michigan legislature made significant reforms to the MPSERS that are designed to reduce overall benefit costs, but the cost reduction impact of the changes will not be experienced by employers for many years. During 2014, the College’s overall retirement expense for MPSERS was $9.5 million, an increase of $801,000 from 2013. Of this total, $7.9 million was for contributions to MPSERS, and the remaining $1.6 million was due to the annual UAAL Rate Stabilization Payment that was appropriated by legislature in Public Act 60 of 2013. The UAAL Rate Stabilization Payment was paid to the College for pass-through to the MPSERS for purposes of offsetting the UAAL cap that was put into place via Public Act 300 of 2012. The $1.6 UAAL retirement expense was directly offset by the same amount of increase in state aid non-operating revenue, as noted below.

Overall operating expenses increased by $1.7 million. This increase was primarily related to a $3.3 million increase in operation and maintenance of facilities due to non-capital equipment purchases for the newly renovated Health Professions Building and various other non-capital maintenance projects, offset by a $1.8 million reduction in Pell grants expensed under the student services functional category.

8

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued DELTA COLLEGE YEAR ENDED JUNE 30, 2015 Operating Expenses - Continued The following is a graphic illustration of operating expenses by function for the years ended June 30, 2015, 2014 and 2013:

Nonoperating Revenue (Expenses) Nonoperating revenue includes all revenue sources that are primarily non-exchange in nature. They consist primarily of state appropriations, property tax revenue, investment income (including realized and unrealized gains and losses), gifts and grants, including Pell grants to students, and contracts that do not require any services to be performed. Nonoperating expenses are those that are not primarily incurred for operating purposes. June 30, 2015: Nonoperating revenue and expense changes are highlighted by the following factors for the year ended June 30, 2015:

Base state appropriations totaled $14.6 million, an increase of $500,000 over 2014. As discussed above, an additional $2.7 million was received specifically for pass-through to the Michigan Public School Employees’ Retirement System for purpose of the UAAL Rate Stabilization payment. The 2015 UAAL payment was $1.1 million higher than what was received in 2014.

Final taxable value of property within the district increased slightly for the year, resulting in property tax revenue of $23.0 million in 2015 at a levy rate of 2.0427 mills, for a revenue increase of .6%.

The College recognized net investment income of $989,000, the majority of which related to the Endowment Fund investments. The market values of the College’s long-term U.S. Agency security portfolio continued to remain stable during 2015.

Pell grants awarded to students were $17.0 million, a decrease of $1.5 million, or 8%, from 2014.

41%

3%

8%28%

8%

7%

5%

2013

Instruction

Public Services

Instructional Support

Student Services

Institutional Administration

Operation & Maintenance of Facilities

Depreciation

40%

3%

8%25%

9%

10%

5%

2014

Instruction

Public Services

Instructional Support

Student Services

Institutional Administration

Operation & Maintenance of Facilities

Depreciation

43%

3%

8%24%

9%

8%

5%

2015

Instruction

Public Services

Instructional Support

Student Services

Institutional Administration

Operation & Maintenance of Facilities

Depreciation

9

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued DELTA COLLEGE YEAR ENDED JUNE 30, 2015 Nonoperating Revenue (Expenses) - Continued

June 30, 2014: Nonoperating revenue and expense changes are highlighted by the following factors for the year ended June 30, 2014:

Base state appropriations totaled $14.1 million, an increase of $300,000 over 2013. As discussed above, an additional $1.6 million was received specifically for pass-through to the Michigan Public School Employees’ Retirement System for purpose of the UAAL Rate Stabilization payment. The 2014 UAAL payment was $1.0 million higher than what was received in 2013.

Final taxable value of property within the district increased slightly for the year, resulting in property tax revenue of $22.8 million in 2014 at a levy rate of 2.0427 mills, for a revenue increase of .9%.

The College had net investment income of $3.1 million, an increase of $1.6 million over 2013. Of this increase, $1.0 million was realized in the Endowment Fund. The market values of the College’s long-term U.S. Agency security portfolio remained stable during 2014.

Pell grants awarded to students were $18.5 million, a decrease of $1.8 million, or 9%, from 2013. The following is a graphic illustration of nonoperating revenue by source for the years ended June 30, 2015, 2014 and 2013:

Other Revenue Other revenue consists of items that are typically nonrecurring, extraordinary, or unusual to the College. Examples would be state capital appropriations, capital gifts and grants, additions to permanent endowments, and transfers from related entities. June 30, 2015: Changes in other revenue are highlighted by the following factors for the year ended June 30, 2015:

Final state capital appropriations related to completion of the Health Professions Building Renovation Project were $2.1 million.

New gifts to the College during the year provided approximately $1.4 million in additions to permanent endowments. June 30, 2014: Changes in other revenue are highlighted by the following factors for the year ended June 30, 2014:

Capital donations and state appropriations, respectively, for the Health Professions Building Renovation Project were $173,000 and $6.9 million.

New gifts to the College during the year provided approximately $246,000 in additions to permanent endowments.

38% 25%

34%3%

2013

Property Taxes

State Appropriations

Pell Federal Grant Revenue

Investment Income & Other

37% 28%

28%7%

2015

Property Taxes

State Appropriations

Pell Federal Grant Revenue

Investment Income & Other

38% 26%

30%6%

2014

Property Taxes

State Appropriations

Pell Federal Grant Revenue

Investment Income & Other

10

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued DELTA COLLEGE YEAR ENDED JUNE 30, 2015 Statement of Cash Flows

The primary purpose of the Statement of Cash Flows is to provide relevant information about the cash receipts and cash payments of an entity during a period. The Statement of Cash Flows also helps users assess:

The ability to generate future net cash flows

The ability to meet obligations as they come due

Needs for external financing The following summarizes the major cash flow components for the College for the years ended June 30, 2015, 2014 and 2013, in millions:

2015

2014

2015-2014 Change

2013

2014-2013 Change

Cash Provided by (Used in): Operating Activities $ (54.0) $ (57.2) $ 3.2 $ (50.8) $ (6.4)

Noncapital Financing Activities 60.2 58.3 1.9 57.6 .7 Capital and Related Financing Activities (2.4) (2.4) - (8.8) 6.4 Investing Activities 6.9 (3.6) 10.5 3.6 (7.2)

Net Increase (Decrease) in Cash

10.7

(4.9)

15.6

1.6

(6.5)

Cash and Cash Equivalents – Beginning of Year 19.5 24.4 (4.9) 22.8 1.6

Cash and Cash Equivalents – End of Year

$ 30.2

$ 19.5

$ 10.7

$ 24.4

$ (4.9)

June 30, 2015: Cash and cash equivalents increased by $10.7 million during the year ended June 30, 2015. Overall, the College gained $4.8 million in total liquid assets as the result of the increase in net position of $7.0 million from operations (excluding the impact of implementing GASB Statements No. 68 and No. 71, as discussed previously). Additionally, due to continued low yield rates, $4.8 million of short-term investments and $1.1 of long-term investments from 2014 were reinvested with shorter-term maturities of three months or less, which resulted in an increase in cash equivalents as of the end of the year. June 30, 2014: Cash and cash equivalents decreased by $4.9 million during the year ended June 30, 2014. These changes primarily reflect the cash flows relative to the Health Professions Building Renovation Project. The College paid out approximately $13.2 million of Building Fund expenses during the year, but received offsetting payments of $6.6 million from the State of Michigan and $967,000 from donors for the Health Professions Building Renovation Project.

11

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued DELTA COLLEGE YEAR ENDED JUNE 30, 2015

Capital Assets At June 30, 2015, the College had $156.7 million invested in capital assets, which net of accumulated depreciation of $57.0 million, resulted in a book value of $99.7 million. Capital assets decreased by $0.8 million in 2015, which included net additions of $3.8 million, less annual depreciation charges of $4.6 million. Details of these assets, shown net of accumulated depreciation, as of June 30, 2015, 2014 and 2013 are as follows, in millions:

2015

2014

2015-2014 Change

2013

2014-2013 Change

Land and Improvements

$ 6.6

$ 6.9

$ (.3)

$ 5.6

$ 1.3

Infrastructure 5.8 6.2 (.4) 5.6 .6

Buildings 80.9 82.2 (1.3) 71.2 11.0

Furniture and Equipment 5.2 4.8 .4 4.3 .5 Construction in Progress 1.2 .4 .8 8.6 (8.2)

Totals

$ 99.7

$ 100.5

$ (.8)

$ 95.3

$ 5.2

In accordance with the College’s Five-Year Capital Outlay Master Plan and Sustainability Strategic Initiative, the College focused on the following capital construction and maintenance projects during 2015:

In June 2012, the State of Michigan approved funding for the Health Professions Building Renovation Project for a total of $20.0 million. The project was 50% funded by the State, with the balance covered by donations and College reserves. The College began construction in March 2013, and the project was substantially completed by the end of August 2013. As of June 30, 2015, final project expenses totaled $18.0 million, toward which the College received $5.7 million in donations and pledges and $9.0 million in state capital appropriations.

During the summer of 2015, the College redesigned and resurfaced the west parking lot and roadway, incurring expenses of $927,000 as of June 30, 2015 that were included in Construction in Progress.

The College also implemented and/or completed various smaller capital maintenance, improvement, and spatial design projects, with total capital expenditures approximating $1.4 million during the year. Some of the more significant projects included the Domestic Water Heaters Replacement Project, the X-1 Building Upgrade Project, and continuation of the Emergency Power and Backup Generator System projects, respectively, with total capitalized costs of $324,000, $571,000, and $565,000.

Debt During the year ended June 30, 2012, the College became involved in the Michigan New Jobs Training Program (MNJTP), which was authorized by state legislature in 2008. Under this program, the College may enter into agreements with employers to provide worker education and job training that is funded by state income tax withholdings on the new employees hired by the employers. The agreements provide for the employer to prepay to the College the costs for the training and education, and the College then issues non-interest bearing revenue bonds payable to the employer equal to the prepayments. The employer remits state income tax withholdings for these new employees directly to the College. The College then remits these state income tax withholdings back to the employer on a quarterly basis to reimburse the employer for the costs of the training, thus reducing the College’s MNJTP bonds payable. As of June 30, 2015, the College has outstanding MNJTP bonds payable of $7,000. Refer to Note 7 for more detailed information about the MNJTP program.

12

MANAGEMENT’S DISCUSSION AND ANALYSIS - Continued DELTA COLLEGE YEAR ENDED JUNE 30, 2015

Economic Factors That Will Affect the Future

The economic position of the College is closely tied to that of the State of Michigan. The State appropriated $14.7 million in base funding for 2015-16, which is an increase of $114,000 over the prior year. After years of strong and record enrollment, the regional economy continues to slowly recover and with that, enrollment is declining. This trend is evident at community colleges across the State as non-traditional students return to the workforce. Enrollment management plan initiatives are in place at the College with goals to attract an increased percentage of the declining K-12 graduates and adults seeking new skills. However, on top of the 52,500 decline in generated credit hours experienced by the College since 2009-10, one-half of which occurred in the past two years, another drop of 10,000 credit hours has been projected for the 2015-16 year. Delta’s Board of Trustees, Budget Cabinet and administration have a long history of focusing on tuition affordability, and accordingly, planned an indistrict tuition rate increase of $2.00, or 2.1%.

The College’s preliminary property tax base remained substantially unchanged for 2015-16, and projected property tax revenue has been budgeted at $22.8 million. Property tax revenues continue to be an area of concern for the College, with expected continued demands for lower property tax valuations, as well as greater capture and abatement of College tax revenues to fund economic development. Additionally, recent legislation approved reductions in the property tax base for levying taxes on personal property, which currently provides $2.7 million in property tax revenues to the College. However, with the passage of Proposal 1 on August 5, 2014 in Michigan, the revenue lost from the elimination of these personal property taxes is expected to be replaced. In addition to national concerns of rising medical costs, the state-mandated contributions to fund both the pension and medical components of the Michigan Public School Employees Retirement System pension fund continue to be a concern. The 2012 MPSERS Reform Act made significant changes to the retirement system in order to better control and ultimately reduce the overall cost to employers to fund employee retirement benefits. Due to the System’s significant unfunded liability, the full effect of these changes will not be realized for many years. The College’s contribution rate to the retirement system averages around 26%, and when combined with required employer FICA and Medicare contributions, the College pays approximately 34% of each covered payroll dollar toward these government-mandated employee benefits. Current financial plans and recent capital investments continue to strategically prepare the College to pursue our Mission and Vision:

MISSION: Delta College serves the Great Lakes Bay Region by educating, enriching and empowering our diverse community of learners to achieve their personal, professional and academic goals.

VISION: Delta College is our communities’ first choice to learn, work and grow. State fiscal challenges will likely continue for some years. The College is prepared to face the forecasted changes in enrollment, operating costs and the demand for services. The College will continue to provide excellent learning opportunities and great value for the educational dollar to create positive futures for the students and communities it serves.

13

Report of Independent Auditors

Board of Trustees Delta College

Report on the Financial Statements

We have audited the accompanying financial statements of Delta College (the College) as of and for the years ended June 30, 2015 and 2014, and the related notes to the financial 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 financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

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

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

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

14

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Delta College as of June 30, 2015 and 2014, and the changes in financial position and cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Emphasis of Matter

As discussed in Note 1 and Note 6 to the financial statements, the College implemented 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. These statements require the College to report its net pension obligation and associated deferred outflows of resources, deferred inflows of resources, and pension expense. The College has restated their July 1, 2014 net position accordingly. Our opinion is not modified with respect to these matters.

Other Matters

Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis on pages 1 through 12 and the Required Supplementary Information on page 46 (Schedule of Proportionate Share of the Net Pension Liability, Schedule of Contributions for Michigan Public School Employees’ Retirement System, and Notes to Required Supplementary Information) be presented to supplement the financial statements. Such information, although not a part of the financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the financial statements, and other knowledge we obtained during our audits of the financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Other Supplementary Information

Our audits were conducted for the purpose of forming an opinion on the financial statements as a whole. The supplemental schedules of other financial information are presented for purposes of additional analysis and are not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. Such information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the financial statements as a whole.

15

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated October 27, 2015 on our consideration of Delta College’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the College’s internal control over financial reporting and compliance.

Saginaw, Michigan October 27, 2015

BALANCE SHEETS

DELTA COLLEGE

2015 2014

ASSETS

CURRENT ASSETS

Cash and cash equivalents (Note 2) 30,254,825$ 19,469,121$

Short-term investments (Note 2) 14,486,019 19,294,186

Property taxes receivable 226,679 248,310

State appropriations receivable (Note 5) 4,432,780 3,126,221

Federal and state grants receivable 1,362,857 740,206

Accounts receivable, net of allowance of $3,582,685 in 2015 and $3,146,238 in 2014 659,792 635,020

Pledges receivable (Note 3) 921,402 372,007

Inventories 1,167,001 1,097,579

Prepaid expenses and other assets 399,656 292,506

TOTAL CURRENT ASSETS 53,911,011 45,275,156

LONG-TERM INVESTMENTS (Note 2) 26,697,269 27,871,620

LONG-TERM PLEDGES RECEIVABLE (Note 3) 1,292,560 570,796

CAPITAL ASSETS (Note 4) 99,694,278 100,484,320

TOTAL ASSETS 181,595,118 174,201,892

LIABILITIES

CURRENT LIABILITIES

Accounts payable 2,578,122 2,008,051

Accrued payroll and other compensation 4,943,791 5,202,534

Unearned revenue 1,206,188 1,076,207

Current portion of MNJTP bonds payable (Note 7) 7,085 35,161

TOTAL CURRENT LIABILITIES 8,735,186 8,321,953

NON-CURRENT LIABILITIES

Net pension liability (Note 6) 80,695,808 -

TOTAL LIABILITIES 89,430,994 8,321,953

DEFERRED INFLOWS OF RESOURCES (Note 6) 780,107 -

NET POSITION

Net investment in capital assets 99,694,278 100,484,320

Restricted for:

Donor-restricted endowments 14,604,646 12,074,865

Expendable scholarships and awards 1,034,049 1,045,021

Instructional department uses 2,182,324 499,669

Public broadcasting activities 816,853 965,395

Other restricted uses 866,581 1,102,946

Unrestricted (Note 1) (27,814,714) 49,707,723

TOTAL NET POSITION 91,384,017$ 165,879,939$

The accompanying notes are an integral part of these statements.

JUNE 30,

16

STATEMENTS OF REVENUE, EXPENSES AND CHANGES IN NET POSITION

DELTA COLLEGE

2015 2014

OPERATING REVENUE

Tuition and fees, net of scholarship allowance of $7,711,906 in 2015 and $7,675,196 in 2014 22,453,957$ 23,004,144$

Federal grants and contracts 4,410,750 3,700,315

State grants and contracts 558,859 116,988

Local and nongovernmental grants and contracts 888,063 938,784

Public broadcasting gifts 626,566 650,658

Auxiliary activities, net of scholarship allowance of $1,544,590 in 2015 and $1,645,975 in 2014 5,388,203 5,746,228

Miscellaneous 915,945 1,261,409

TOTAL OPERATING REVENUE 35,242,343 35,418,526

OPERATING EXPENSES

Instruction 40,303,334 38,646,294

Public services 2,558,923 2,572,885

Instructional support 7,793,010 7,696,696

Student services 22,695,860 24,164,176

Institutional administration 8,253,296 8,213,930

Operation and maintenance of facilities 7,249,469 9,919,786

Depreciation expense 4,582,680 4,499,075

Fundraising expenses 39,294 65,834

TOTAL OPERATING EXPENSES 93,475,866 95,778,676

OPERATING LOSS (58,233,523) (60,360,150)

NONOPERATING REVENUE (EXPENSES)

State appropriations 17,337,374 15,765,565

Property tax levy 22,931,569 22,797,665

Pell federal grant revenue 16,992,112 18,480,576

Gifts 3,799,757 714,415

Special events, net of expenses of $53,122 in 2015 and $77,706 in 2014 69,829 111,076

Investment income, net of investment expense of $149,866 in 2015 and $147,041 in 2014 988,888 3,085,600

Loss on disposition of capital assets (183,995) (370,490)

Foundation grants and distributions to or for Delta College (160,640) (13,143)

NET NONOPERATING REVENUE (EXPENSES) 61,774,894 60,571,264

NET INCOME BEFORE OTHER REVENUE 3,541,371 211,114

OTHER REVENUE

State capital appropriations 2,069,343 6,923,789

Capital gifts and grants - 173,355

Additions to permanent endowments 1,447,632 246,122

TOTAL OTHER REVENUE 3,516,975 7,343,266

NET INCREASE IN NET POSITION 7,058,346 7,554,380

NET POSITION - BEGINNING OF YEAR

Beginning of year 165,879,939 158,325,559

Adjustment for change in accounting principle (Note 1) (81,554,268) -

NET POSITION - BEGINNING OF YEAR, AS RESTATED 84,325,671 158,325,559

NET POSITION - END OF YEAR 91,384,017$ 165,879,939$

The accompanying notes are an integral part of these statements.

YEAR ENDED JUNE 30,

17

STATEMENTS OF CASH FLOWS

DELTA COLLEGE

2015 2014

CASH FLOWS FROM OPERATING ACTIVITIES

Tuition and fees 22,088,913$ 22,700,433$

Grants and contracts 5,245,725 5,224,128

Public broadcasting gifts 626,566 650,658

Payments to suppliers (48,167,136) (52,503,176)

Payments to employees (40,102,891) (40,337,335)

Auxiliary enterprise charges 5,388,242 5,766,660

Other 904,705 1,287,685

NET CASH USED IN OPERATING ACTIVITIES (54,015,876) (57,210,947)

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES

State appropriations 17,044,444 16,052,863

Local property taxes 22,953,200 22,752,547

Pell federal grant revenue 16,957,744 18,551,731

Gifts and contributions for other than capital purposes 3,483,330 843,755

Foundation special events receipts 113,329 111,076

Foundation grants and distributions to or for Delta College (160,640) (13,143)

Agency fund transactions (159,538) 3,219

NET CASH PROVIDED BY NONCAPITAL FINANCING ACTIVITIES 60,231,869 58,302,048

CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES

Proceeds from capital gifts, grants and appropriations 1,546,639 7,730,855

Purchase of capital assets (3,989,745) (10,054,301)

Proceeds from disposition of capital assets 13,112 -

Proceeds from issuance of MNJTP bonds 331,365 129,661

Principal paid on MNJTP bonds (302,859) (166,417)

NET CASH USED IN CAPITAL AND RELATED FINANCING ACTIVITIES (2,401,488) (2,360,202)

CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds from sales and maturities of investments 45,047,122 42,272,934

Investment income 538,805 414,148

Purchase of investments (38,614,728) (46,300,726)

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 6,971,199 (3,613,644)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 10,785,704 (4,882,745)

CASH AND CASH EQUIVALENTS - Beginning of year 19,469,121 24,351,866

CASH AND CASH EQUIVALENTS - End of year 30,254,825$ 19,469,121$

The accompanying notes are an integral part of these statements.

YEAR ENDED JUNE 30,

18

STATEMENTS OF CASH FLOWS - Continued

DELTA COLLEGE

2015 2014

RECONCILIATION OF OPERATING LOSS TO

NET CASH USED IN OPERATING ACTIVITES:

Operating loss (58,233,523)$ (60,360,150)$

Adjustment to reconcile operating loss to net cash

used in operating activities:

Depreciation 4,582,680 4,499,075

Allowance for uncollectible accounts 436,447 360,876

(Increase) decrease in assets:

Federal and state grants receivable (588,283) 461,019

Accounts receivable (488,365) (149,275)

Inventories (69,422) 109,785

Prepaid expenses and other assets (107,873) 420,486

Increase (decrease) in liabilities:

Accounts payable 701,103 (2,550,923)

Accrued payroll and other compensation (258,743) 98,866

Unearned revenue 88,456 (100,706)

Net pension liability (5,094,556) -

Increase in deferred inflows of resources 5,016,203 -

NET CASH USED IN OPERATING ACTIVITIES (54,015,876)$ (57,210,947)$

The accompanying notes are an integral part of these statements.

YEAR ENDED JUNE 30,

19

20

NOTES TO FINANCIAL STATEMENTS DELTA COLLEGE JUNE 30, 2015 NOTE 1. SIGNIFICANT ACCOUNTING POLICIES Reporting Entity Delta College is a Michigan community college whose financial statements have been prepared in accordance with the generally accepted accounting principles as applicable to public colleges and universities outlined in Governmental Accounting Standards Board (GASB) Statement No. 35, Basic Financial Statements – and Management’s Discussion and Analysis – for Public Colleges and Universities, and the Manual for Uniform Financial Reporting – Michigan Public Community Colleges, 2001. The College reports as a Business Type Activity, as defined by GASB Statement No. 35. Business Type Activities are those that are financed in whole or in part by fees charged to external parties for goods or services. The accompanying financial statements have been prepared in accordance with criteria established by GASB Statement No. 61, The Financial Reporting Entity: Omnibus – an amendment to GASB Statements No. 14 and No. 34, and GASB Statement No. 39, Determining Whether Certain Organizations Are Component Units, for determining the various governmental organizations to be included in the reporting entity. These criteria include significant operational or financial relationships with the College. Based on application of the criteria, the Delta College Foundation discussed in Note 14 is included in the College’s reporting entity. Significant accounting policies followed by Delta College are described below to enhance the usefulness of the financial statements to the reader: Accrual Basis The financial statements of Delta College have been prepared on the accrual basis of accounting, whereby revenue is recognized when earned and expenditures are recognized when the related liabilities are incurred and certain measurement and matching criteria are met. Cash and Cash Equivalents Cash and cash equivalents consist of all highly liquid investments with an initial maturity of three months or less when purchased. Investments Investments are recorded at fair value, based on quoted market prices. Inventories Inventories are stated at the lower of cost or market using the first-in, first-out method.

21

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 1. SIGNIFICANT ACCOUNTING POLICIES – Continued Capital Assets Capital assets are recorded at cost or, if acquired by gift, at the fair market value as of the date of acquisition. Expenditures for maintenance and repairs are expensed as incurred. Depreciation is calculated on property and equipment using the straight-line method over the estimated useful lives of the assets. The American Health Association’s Estimated Useful Lives of Depreciable Hospital Assets was utilized as a guide in establishing useful lives of the College’s property and equipment.

Revenue Recognition State appropriations for operations are recognized as revenue on a proportionate basis over the period for which they are appropriated (see Note 5). Restricted Fund revenue is primarily recognized only to the extent expended. Revenue received prior to year-end that is related to the next fiscal year is recorded as unearned revenue. As of June 30, 2015 and 2014, unearned tuition and fee revenue for the summer semester, which begins in late June or early July and ends in August, was approximately $718,000 and $757,000, respectively. Additionally, advance payments approximating $170,000 for the fall 2015 semester were received before June 30, 2015 and recorded as unearned revenue. As of June 30, 2014, advance payments approximating $194,000 for the fall 2014 semester were received before year end and recorded as unearned revenue. Gifts and Pledges Gifts are recorded when received. Voluntary nonexchange transactions (pledges) are recognized in accordance with the GASB Statement No. 33, Accounting and Financial Reporting for Nonexchange Transactions. GASB Statement No. 33 requires recognition of the entire pledge in the first period that use is permitted and all applicable eligibility requirements have been satisfied. Such pledges are recorded at their discounted present value, net of allowance for uncollectible pledges. Internal Service Activities Revenue and expenses related to internal service activities approximating $658,000 and $657,000 for 2015 and 2014, respectively, have been eliminated. These activities include services provided by the College’s Bookstore, Food Services, Fitness & Recreation Center, and Planetarium Gift Shop & Conference Services, as well as the use of printing and copy services, and college vehicles. Compensated Absences Compensated absences represent the accumulated liability to be paid under the College’s current vacation policy. Under the College’s policy, employees accrue vacation on a bi-weekly basis at a rate that is dependent on the employee’s pay class.

22

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 1. SIGNIFICANT ACCOUNTING POLICIES – Continued 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 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 Statement 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 of the net pension liability. The Statements also enhance accountability and transparency through revised note disclosures and required supplementary information (RSI). In accordance with the statement, the College has reported a net pension liability of $85.8 million and a deferred outflow of resources of $4.2 million as a change in accounting principle adjustment that reduced unrestricted net position as of July 1, 2014 by $81.6 million. Unrestricted Net Position As of June 30, 2015 and 2014, the College has designated the use of unrestricted net position as follows: 2015 2014

Designated for potential contingency in state appropriations $ 3,135,694 $ 2,842,764 Designated for Corporate Services activities 1,019,120 1,064,804 Designated for future capital outlay 28,539,215 25,118,731 Designated for funds functioning as endowments 5,991,047 5,769,961 Other designated fund activities 3,957,623 4,003,908 MPSERS pension liability (81,475,915) - Unrestricted and unallocated 11,018,502 10,907,555

Total Unrestricted Net Position

$ (27,814,714)

$ 49,707,723

23

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015

NOTE 2. CASH AND CASH EQUIVALENTS AND INVESTMENTS The College considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. The College considers all investments maturing within one year or less as of the balance sheet date to be short-term. The College’s deposits and investments are included on the balance sheet at June 30, 2015 and 2014 under the following classifications:

2015 2014

Cash and cash equivalents $ 30,254,825 $ 19,469,121 Short-term investments 14,486,019 19,294,186 Long-term investments 26,697,269 27,871,620

Total $ 71,438,113 $ 66,634,927

The amounts in the previous chart are classified in the following categories:

Bank Deposits The above deposits at June 30, 2015 and 2014 were reflected in the accounts of the bank (without recognition of checks written but not cleared, or of deposits in transit) at $9,173,189 and $10,961,785, respectively. Of these bank deposits, approximately $1,750,000 and $1,729,000, respectively, was covered by federal depository insurance, and the remainder was uninsured and uncollateralized. The College believes that due to the dollar amounts of cash deposits and the limits of FDIC insurance, it is impractical to insure all bank deposits. As a result, the College evaluates each financial institution within which it deposits College funds and assesses the level of risk of each. Only those institutions with an acceptable estimated risk level are used as depositories. Investments – Excluding Endowment Fund Investments Credit Risk – Credit Risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. The College’s policy for reducing credit risk is to invest surplus funds, excluding Endowment Fund monies, in accordance with the provisions set forth in Michigan Public Act 331 of 1996, as amended through 2014. This Act allows the College to invest in: bonds, bills or notes of the United States or its agencies; obligations of the State of Michigan or any of its political subdivisions rated as investment grade by at least one standard rating service; corporate commercial paper rated prime by at least one of the standard rating services; bankers acceptances issued by and certificates of deposit of financial institutions which are members of the Federal Deposit Insurance Corporation; mutual funds and investment pools that are composed of authorized investment instruments; and certain repurchase agreements. The College does not have a formal investment policy further limiting its investment options. Endowment Fund investments are subject to a separate investment policy which is discussed in detail later in this footnote.

2015 2014

Bank deposits (checking accounts, savings accounts and certificates of deposit)

$ 9,206,939

$ 9,913,856

Investments in securities and similar instruments 62,176,324 56,666,221 Petty cash and cash on hand 54,850 54,850

Total $ 71,438,113 $ 66,634,927

24

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 2. CASH AND CASH EQUIVALENTS AND INVESTMENTS – Continued Investments – Excluding Endowment Fund Investments – Continued Interest Rate Risk – Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The College does not have a formal policy limiting investment maturities; however, the College manages its exposure to interest rate risk by limiting the significant majority of investment maturities to less than three years. Investments in longer-term securities are managed through a laddered-maturity and step-rate portfolio in order to obtain some of the higher interest rates offered on the market. Concentration of Credit Risk – Concentration of credit risk is the risk of loss attributed to the magnitude of the organization’s investment in a single issuer. The College does not have a policy limiting the amount the College is allowed to invest in any one issuer; however, the College evaluates each issuer in which it invests College funds and assesses the level of risk of each. The College invests with only those issuers with an acceptable estimated risk level. Custodial Credit Risk – Custodial credit risk for investments is the risk that, in the event of a failure of the counterparty, the College will not be able to recover the value of the investments that are in the possession of an outside party. The College does not have a formal policy addressing custodial credit risk; however, all of the College’s investments are issued in the name of the College. Custody of the College’s certificates of deposit remains with the financial institutions from which they were purchased, while the agency notes, bonds and commercial paper are held in safekeeping by either PNC Capital Markets LLC or Morgan Stanley Smith Barney LLC. In the event that PNC Capital Markets LLC or Morgan Stanley Smith Barney LLC were to become insolvent, and the College’s investment account assets were not fully accounted for, each of these accounts would be protected up to a maximum of $500,000 through Securities Investor Protection Corporation (SIPC). In addition, in the event that SIPC coverage is not adequate to cover a client’s loss, Morgan Stanley Smith Barney LLC also carries supplemental insurance protection subject to an aggregate loss limit maximum of $1.0 billion for the firm, with a no per client limit for securities and a $1.9 million per client limit for the cash portion of any remaining shortfall. The following tables present the investments and maturities that the College held at June 30, 2015 and 2014, including certificates of deposit and commercial paper classified as cash equivalents, and excluding the Endowment Fund investments: June 30, 2015 By Maturity

Investment Type

S&P Quality

Ratings

Fair Market

Value

Less Than One Year

1-3 Years

More Than

3 Years

Certificates of Deposit N/A $ 2,008,374 $ 2,008,374 $ - $ - U.S. Agency Securities AA+ 7,726,105 - - 7,726,105 Commercial Paper A1+/P1 to A2/P2 34,972,749 34,972,749 - -

Total Investments $ 44,707,228 $ 36,981,123 $ - $ 7,726,105

25

NOTES TO FINANCIAL STATEMENTS - Continued

DELTA COLLEGE JUNE 30, 2015

NOTE 2. CASH AND CASH EQUIVALENTS AND INVESTMENTS – Continued Investments – Excluding Endowment Fund Investments – Continued

June 30, 2014 By Maturity

Investment Type

S&P Quality

Ratings

Fair Market

Value

Less Than One Year

1-3 Years

More Than

3 Years

Certificates of Deposit N/A $ 2,004,353 $ 2,004,353 $ - $ - U.S. Agency Securities AA+ 10,564,479 - 2,000,720 8,563,759 Commercial Paper A1+/P1 to A2/P2 28,289,561 28,289,561 - -

Total Investments $ 40,858,393 $ 30,293,914 $ 2,000,720 $ 8,563,759

The College’s investments at June 30, 2015 and 2014 were invested as follows, including commercial paper classified as cash equivalents and excluding the Endowment Fund investments: June 30, 2015 June 30, 2014

Investment Fair Market Percentage of Fair Market Percentage of

Issuer Type Value Total Value Total

Federal Home Loan Bank Notes $ 3,850,674 9% $ 3,739,464 9% Federal Home Loan Mortgage Corp. Notes - - 2,000,720 5% Federal National Mortgage Assn. Notes 3,875,431 9% 4,824,295 12% Abbey Nat’l North America LLC Commercial Paper 3,498,974 8% 2,998,280 7% AKZO Nobel NV Commercial Paper 1,999,620 5% - - Assa Abloy Financial Commercial Paper - - 999,060 2% Atlantic Asset Sec LLC Commercial Paper - - 999,780 2% Autobahn Funding Co. LLC Commercial Paper - - 1,999,720 5% Banco Santander Chile Commercial Paper - - 1,999,860 5% Bell Canada Commercial Paper 999,920 2% - - Campbell Soup Co. Commercial Paper 2,998,950 7% 999,490 2% Celgene Corp. Commercial Paper - - 999,980 3% Coca Cola Commercial Paper 1,995,500 4% - -

(continued on next page)

26

NOTES TO FINANCIAL STATEMENTS - Continued

DELTA COLLEGE JUNE 30, 2015

NOTE 2. CASH AND CASH EQUIVALENTS AND INVESTMENTS – Continued Investments – Excluding Endowment Fund Investments – Continued

(continued from previous page)

June 30, 2015 June 30, 2014

Investment Fair Market Percentage of Fair Market Percentage of Issuer Type Value Total Value Total

Direct TV Holdings LLC Commercial Paper $ - - $ 1,999,920 5% Dominion Resources Inc. Commercial Paper 999,920 2% - - Duke Energy Corp. Commercial Paper 1,999,180 4% - - General Electric Capital Corp. Commercial Paper 999,100 2% - - Hitachi America Capital Commercial Paper - - 1,999,720 5% Hyundai Capital America Commercial Paper 3,998,460 9% 998,640 2% ING US Funding LLC Commercial Paper 1,999,200 5% 2,299,811 6% Magellan Mid Partners Commercial Paper 1,999,980 5% - - Marriott RHG Acquist BV Commercial Paper - - 999,990 3% Metlife Short Term Fund Commercial Paper - - 999,810 2% Mondelez International Commercial Paper - - 999,080 2% Nataxis US Finance Commercial Paper - - 1,999,640 5% Nationwide Building Soc. Commercial Paper 1,999,840 5% 999,900 3% Prudential Financial Inc. Commercial Paper 1,499,445 3% - - Prudential PLC Commercial Paper 1,998,740 4% 1,998,710 5% Societe Generale N America Commercial Paper - - 998,380 2% Stryker Corp. Commercial Paper - - 999,790 2% Tate & Lyle Int’l Finance PLC Commercial Paper 3,999,280 9% - - Vodafone Group PLC Commercial Paper 1,986,640 4% - - Independent Bank Certificate of Deposit 1,003,187 2% 1,000,908 3% Wolverine Bank Certificate of Deposit 1,005,187 2% 1,003,445 3%

Total Investments

$ 44,707,228

100%

$ 40,858,393

100%

27

NOTES TO FINANCIAL STATEMENTS - Continued

DELTA COLLEGE JUNE 30, 2015

NOTE 2. CASH AND CASH EQUIVALENTS AND INVESTMENTS – Continued Endowment Fund Investments Credit Risk – The College has attempted to mitigate credit risk associated with Delta College Endowment Fund (The Fund) investments by contracting with Morgan Stanley Wealth Management LLC to manage the investments of The Fund. The College has established a formal investment and distribution policy that Morgan Stanley Wealth Management LLC must adhere to in their management of the Endowment Fund. The investment and distribution policies of the Endowment Fund, as well as the investment returns, are established, monitored and evaluated by the College’s Investment Advisory Committee, which reports directly to the Board of Trustees. The Delta College Endowment Fund Investment and Distribution Policy limits investment of Endowment Fund monies to the following instruments: bonds, notes or treasury bills of the United States, or its agencies; corporate bonds rated investment grade by Moody’s Investors Service, Inc. or Standard & Poor’s Corporation; certificates of deposit of institutions which are members of the Federal Deposit Insurance Corporation; commercial paper rated prime as A1 by Moody’s Investors Service, Inc. and/or P1 by Standard & Poor’s Corporation; certain bankers acceptances; common stock traded on United States exchanges; international equity investments and American Depository Receipts (ADR’s); mutual funds; convertible securities, bonds and preferred stocks; and alternative investments made using mutual funds, exchange traded funds or separately managed accounts to ensure that daily valuations and liquidity are maintained. Mutual funds may be purchased if the stated objectives of the fund are consistent with the objectives of the Endowment Fund. The fixed income portfolio shall maintain a weighted average quality of investment grade. Additionally, all investments in the Fund must have a readily ascertainable market value and must be readily marketable. The following investments are only authorized as alternative investment strategies in accordance with the preceding paragraph: short sales; put and call option strategies; commodities futures; direct investment in tangible assets such as real estate, oil and gas, and precious metals; private placements; venture capital financing; and hedge funds. The following investments are prohibited: margin purchases and securities of the Investment Manager including proprietary mutual funds. Interest Rate Risk – In order to limit interest rate risk, the Endowment Fund investment policy stipulates various maturity limits. Commercial paper maturities may not exceed 270 days, bankers’ acceptances are limited to 180-day maturities, and the average weighted maturity of the fixed income portfolio shall fall within a range of 3-10 years. Concentration of Credit Risk – The Delta College Endowment Fund Investment and Distribution Policy limits the investment in individual securities of any one issuer or in any one alternative investment strategy to 5% of the market value of the assets of the Fund, except for convertible securities, which may not exceed 15% of the Fund. This 5% limit also does not apply to money market funds, mutual funds, except the mutual funds that are classified as alternative investments, or obligations of the United States government or its agencies. Additionally, the Fund is limited to a maximum composite of 20% invested in international equities and ADR’s, and a maximum composite of 25% invested in alternatives. As of June 30, 2015 and 2014, the Endowment Fund did not hold any securities of any one issuer in excess of these limits. Custodial Credit Risk – The Endowment Fund investment policy does not address the issue of custody. The Endowment Fund investments are held by Morgan Stanley Smith Barney LLC as custodian, and are listed under the account name Delta College Endowment Fund. Morgan Stanley Smith Barney LLC’s investor protection coverage has been described on the previous page in the Custodial Credit Risk section related to the College’s investments outside of the Endowment Fund.

28

NOTES TO FINANCIAL STATEMENTS - Continued

DELTA COLLEGE JUNE 30, 2015

NOTE 2. CASH AND CASH EQUIVALENTS AND INVESTMENTS – Continued Endowment Fund Investments – Continued Foreign Currency Risk – All foreign investments held by the Endowment Fund are in the form of ADR’s and are denominated in U.S. currency. At June 30, 2015 the Endowment Fund had the following investments and maturities:

* Due to the convertible feature of these investments, they are generally not held to maturity.

By Maturity

Investment Type

S&P Quality

Ratings

Fair Market

Value

Less Than One Year

1-5 Years

6-10 Years

More Than 10 Years

Corporate Bonds Corporate Bonds Corporate Convertible Bonds *

AA- to A- BBB+ to BBB-

A+ to A-

$ 336,228 86,577

387,277

$ - - -

$ 134,717 45,102

60,280

$ 201,511 41,475 91,899

$ - -

235,098 Corporate Convertible Bonds * BBB+ to B 916,812 241,011 366,864 16,293 292,644 Corporate Convertible Bonds * Unrated 187,149 - 187,149 - - Government & Agency Bonds N/A 789,954 46,050 567,929 - 175,975

2,703,997 $ 287,061 $ 1,362,041 $ 351,178 $ 703,717

Bond Funds N/A 1,016,320 Preferred Stock N/A 102,455 Equities N/A 9,697,856 International Equities N/A 2,798,067 Alternative Investment Funds N/A 2,652,469

Total Investments $ 18,971,164

29

NOTES TO FINANCIAL STATEMENTS - Continued

DELTA COLLEGE JUNE 30, 2015 NOTE 2. CASH AND CASH EQUIVALENTS AND INVESTMENTS – Continued Endowment Fund Investments – Continued At June 30, 2014 the Endowment Fund had the following investments and maturities:

* Due to the convertible feature of these investments, they are generally not held to maturity.

NOTE 3. PLEDGES RECEIVABLE As of June 30, 2015 and 2014, donors to the College (including the Delta College Foundation) have made unconditional promises to give (pledges) approximating $2,238,000 and $966,000, respectively. Such pledges are discounted to their present value, assuming their respective terms, at applicable discount rates with total discounts at June 30, 2015 and 2014, respectively, of approximately $18,000 and $13,000. Management has also established an allowance for uncollectible pledges approximating $6,000 and $10,000, respectively, as of June 30, 2015 and 2014. Pledges deemed uncollectible are charged against the allowance in the period that determination is made.

By Maturity

Investment Type

S&P Quality

Ratings

Fair Market

Value

Less Than One Year

1-5 Years

6-10 Years

More Than 10 Years

Corporate Convertible Bonds *

A+ to A-

$ 495,350

$ -

$ 210,418

$ 84,684

$ 200,248

Corporate Convertible Bonds * BBB+ to BB- 911,898 162,473 497,033 - 252,392 Corporate Convertible Bonds * Unrated 38,098 - 38,098 - - Government & Agency Bonds N/A 1,073,907 - 205,843 449,666 418,398

2,519,253 $ 162,473 $ 951,392 $ 534,350 $ 871,038

Bond Funds Preferred Stock

N/A N/A

1,012,520 104,359

Equities N/A 8,337,601 International Equities N/A 2,712,612 Alternative Investment Funds N/A 2,620,796

Total Investments $ 17,307,141

30

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 3. PLEDGES RECEIVABLE – Continued Collection of pledges receivable, net of discount and allowance, as of June 30, 2015 and 2014, are scheduled as follows:

2015 2014

Less than one year $ 921,402 $ 372,007 One to five years 1,291,672 569,911 Greater than five years 888 885

Total $ 2,213,962 $ 942,803

NOTE 4. CAPITAL ASSETS

The following tables present the changes in the various capital asset class categories for the years ended June 30, 2015 and 2014: Year Ended June 30, 2015 Estimated Beginning Additions/ Ending

Useful Life Balance Depreciation Deletions Balance

Depreciable Capital Assets:

Buildings 40 years $ 117,698,931 $ 1,814,490 $ 700,091 $ 118,813,330 Land improvements 20-40 years 8,265,949 73,115 18,994 8,320,070 Infrastructure 20-25 years 11,101,075 2,919 39,523 11,064,471 Furniture and equipment 5-20 years 14,832,146 1,279,414 206,842 15,904,718 Non-depreciable Capital Assets: Construction in progress 376,058 2,710,331 1,890,524 1,195,865 Land 1,351,560 - - 1,351,560 Fine art collection 88,752 - - 88,752

Total Capital Assets 153,714,471 5,880,269 2,855,974 156,738,766

Less Accumulated Depreciation: Buildings 35,474,523 2,914,779 508,235 37,881,067 Land improvements 2,745,003 388,687 18,991 3,114,699 Infrastructure 4,884,150 385,453 39,515 5,230,088 Furniture and equipment 10,126,475 893,761 201,602 10,818,634

Total Accumulated Depreciation 53,230,151 $ 4,582,680 $ 768,343 57,044,488

Capital Assets, Net $ 100,484,320 $ 99,694,278

31

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 4. CAPITAL ASSETS – Continued Year Ended June 30, 2014: Estimated Beginning Additions/ Ending

Useful Life Balance Depreciation Deletions Balance

Depreciable Capital Assets:

Buildings 40 years $ 106,812,549 $ 14,235,850 $ 3,349,468 $ 117,698,931 Land improvements 20-40 years 6,897,037 1,649,265 280,353 8,265,949 Infrastructure 20-25 years 10,276,831 1,013,887 189,643 11,101,075 Furniture and equipment 5-20 years 13,634,654 1,351,303 153,811 14,832,146 Non-depreciable Capital Assets: Construction in progress 8,592,062 8,682,998 16,899,002 376,058 Land 1,351,560 - - 1,351,560 Fine art collection 68,752 20,000 - 88,752

Total Capital Assets 147,633,445 26,953,303 20,872,277 153,714,471

Less Accumulated Depreciation: Buildings 35,599,231 2,870,707 2,995,415 35,474,523 Land improvements 2,639,205 384,442 278,644 2,745,003 Infrastructure 4,688,436 385,323 189,609 4,884,150 Furniture and equipment 9,406,989 858,603 139,117 10,126,475

Total Accumulated Depreciation 52,333,861 $ 4,499,075 $ 3,602,785 53,230,151

Capital Assets, Net $ 95,299,584 $ 100,484,320

NOTE 5. RECOGNITION OF STATE APPROPRIATIONS The College records revenue from state operating appropriations in accordance with the accounting method described in the annual funding bill passed by the State of Michigan legislature, which provides that state appropriations are recorded as revenue in the period for which they were appropriated. Accordingly, the College recognizes 100% of the state’s fiscal year appropriations as revenue during the College’s fiscal year. Also, since state appropriations are distributed over an 11-month period, October through August, the College records a receivable at June 30 each year for the subsequent payments received in July and August. The accrued state appropriation receivables at June 30, 2015 and 2014, respectively, are $4.4 million and $3.1 million, and include $500,000 and $293,000, respectively, to be passed through to MPSERS for the UAAL Stabilization payment. Additionally, the 2015 and 2014 receivables includes $1.3 million and $283,000, respectively, for the Health Professions Building Project capital appropriation.

Based on past experience, for each of the years ended June 30, 2015 and 2014, the College has designated a portion of its unrestricted net position equal to the July and August payment amounts as estimates of the potential contingency in the event that the State were to change its method of distributing state appropriations that would cause the College to experience a permanent deferral or elimination of state appropriation revenue, as occurred during the 2006-2007 fiscal year.

32

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 6. RETIREMENT PLANS MPSERS Defined Benefit Pension and Defined Contribution Plans Plan Description – The majority of College employees participate in the Michigan Public School Employees’ Retirement System (MPSERS), a statewide multiple employer cost-sharing public school employee retirement system governed by the State of Michigan that provides retirement, survivor and disability benefits to plan members and their beneficiaries. Until July 1, 2010, MPSERS provided two defined benefit plans, the Basic Plan and the Member Investment Plan. An employee who participates in the Basic Plan may retire at age 55 with 30 or more years of credited service or at age 60 with 10 or more years of credited service with a retirement benefit, payable monthly for life, equal to either 1.25% or 1.50%, as opted by the employee, of his or her final average compensation multiplied by the number of years of credited service. Final average compensation is the employee’s highest total wages earned during a period of 60 consecutive calendar months. An employee who participates in the Member Investment Plan (MIP) may retire at any age with 30 years of service, or at age 60 with 5 years of credited service, provided the member has worked through his or her 60th birthday and has credited service in each of the five school fiscal years immediately preceding the retirement allowance effective date, with a retirement benefit, payable monthly for life, equal to either 1.25% or 1.50%, as opted by the employee, of the participant’s final average compensation multiplied by the number of years of credited service. Final average compensation is the employee’s highest total wages earned during a period of 36 consecutive calendar months. Benefits under both plans, which are established by state statute, are fully vested upon reaching 10 years of service. Vested employees with less than 30 years of service may retire at age 55 under reduced benefits. In accordance with Public Act 75 of 2010, on July 1, 2010, MPSERS introduced a hybrid retirement plan called the Pension Plus Plan. New members who began working on or after July 1, 2010, but before September 4, 2012, were required to participate in the Pension Plus Plan. This plan is a combination of the defined benefit MIP Plan, as previously described, and a newly created Defined Contribution Plan administered by Voya Financial. Both components of the Pension Plus Plan include member and employer contributions. Employer contributions to the MIP defined benefit component of the Pension Plus Plan are at a slightly reduced rate than the employer contribution rate required for participants in the Basic and MIP Plans. Public Act 300 of 2012, commonly referred to as MPSERS Reform 2012, was enacted on September 4, 2012. This legislation made significant changes to the retirement system, for both existing members and new members, in order to better control and ultimately reduce the overal l cost to employers to fund employee retirement benefits. The primary changes included providing one-time irrevocable plan options for existing members in regards to both pension and retirement healthcare benefits, expansion of the defined contribution components of the system, general increases in the share of contribution required to be paid by active members, and elimination of retirement healthcare insurance for new members hired on or after September 4, 2012. Although the MPSERS Reform 2012 changes were initially established to begin effective October 1, 2012, due to some legal delays, the changes did not become fully effective until February 1, 2013. The MPSERS Reform 2012 legislation also capped at 20.96% the portion of the employer contribution rate assessed for purposes of covering the system’s unfunded actuarial accrued liability (UAAL), and the State has been providing additional appropriation funding to the College for pass-through to MPSERS for purposes of covering the UAAL in excess of the 20.96% cap. For the years ended June 30, 2015 and 2014, respectively, the College received from the State and paid to MPSERS $2.7 million and $1.6 million for the additional UAAL.

33

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 6. RETIREMENT PLANS – Continued MPSERS Defined Benefit Pension and Defined Contribution Plans – Continued Plan Description (continued) – The MPSERS Reform 2012 legislation also introduced two new options under the Defined Contribution Plan: the new Personal Healthcare Fund (PHF), a defined contribution savings plan administered by Voya Financial and designed to supplement retiree healthcare costs; and the 100% Defined Contribution Plan option, also administered by Voya Financial. All new MPSERS participants hired after September 4, 2012 by default are placed in the Pension Plus Plan, but may opt to retroactively elect the 100% Defined Contribution Plan within 75 days. New members are also automatically placed into the PHF fund, as the former retirement health insurance option has been eliminated for all new employees. Additionally, existing members had the one-time irrevocable option to convert from their current pension and healthcare insurance benefit plan to either or both the PHF and the 100% Defined Contribution Plan. The Defined Contribution Plan, including the PHF, provide for both member and employer contributions. Participants are immediately 100% vested in all employee contributions to the Defined Contribution Plan. Vesting in employer contributions to the Defined Contribution Plan is on a graduated scale: 50% at 2 years, 75% at 3 years, and 100% at 4 years. Eligibility for retirement distributions from the Defined Contribution Plan also vary from the Basic, MIP, or Pension Plus defined benefit plans, and follow standard IRS guidelines for 457 and 401(k) plan distributions. MPSERS issues a publicly available comprehensive annual financial report (CAFR) that includes financial statements and required supplementary information for the pension and post-employment health care plans. That report may be obtained by writing to MPSERS at P.O. Box 30171, Lansing, MI 48909-7671, or on their website at http://www.michigan.gov/orsschools/. Post Employment Benefits – MPSERS Reform 2012 also made some changes relative to post-employment healthcare benefits. Specifically, retirees participating in MPSERS have the option of continuing health, prescription drug, dental and vision coverage, but the portion of the retiree insurance premium subsidized by MPSERS has changed. Retirees having these coverages contribute an amount equivalent to the monthly cost for Part B Medicare and 20% to 70% of the monthly premium amount for the health, dental, and vision coverages, depending on their years of service. Required contributions for post-employment healthcare benefits are included as part of the College’s total contribution to MPSERS, plus the employee contributions to the Healthcare Insurance Trust, as discussed below. Funding Policy – Employer contributions to MPSERS result from the effects of implementing the School Finance Reform Act (ACT). Under the ACT, each College is required to contribute the full actuarial funding contribution amount to fund pension benefits, plus an additional amount to fund retiree healthcare benefit amounts on a cash disbursement basis. Public Act 75 of 2010, in conjunction with Public Act 77, also required all MPSERS members, effective July 1, 2010, to begin contributing a mandatory 3.0% to an irrevocable Healthcare Insurance Trust for purposes of funding retiree healthcare insurance benefits. Members earning less than $18,000 annually were allowed to contribute 1.5% during the 2010-11 year, but their required contribution increased to 3.0% as of July 1, 2011. These mandatory contributions are nonrefundable. Not soon after this legislation was enacted, a lawsuit was filed against the State claiming that the mandatory contribution was unlawful, and thus far, an initial court ruling has agreed with that claim. This decision, however, is being appealed, and until the lawsuit is resolved, reporting units are required to continue to withhold and contribute the 3.0%. It is anticipated that the MPSERS Reform 2012 actions made by legislature will negate this legal claim.

34

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 6. RETIREMENT PLANS – Continued MPSERS Defined Benefit Pension and Defined Contribution Plans – Continued Following are the employer and employee contribution rates associated with the MPSERS system for the year ended June 30, 2015: July 1, 2014 – September 30, 2014

Plan Description

Employer Defined Benefit

Employee Defined Benefit

Employer Defined Contribution

Employee Defined Contribution

Basic with Health Insurance Trust (HI) 24.79% - - - Basic converted to Personal Healthcare Fund (PHF) 23.86% - - - Basic 4% with HI 24.79% 4% - - Basic 4% converted to PHF 23.86% 4% - - Basic converted to DC with HI 21.89% - 4% Elective up to IRS limit Basic converted to DC with PHF 20.96% - 4% Elective up to IRS limit MIP Fixed with HI 24.79% 3.9% - - MIP Fixed converted to PHF 23.86% 3.9% - - MIP Graded with HI 24.79% 3.0–4.3% - - MIP Graded converted to PHF 23.86% 3.0–4.3% - - MIP Plus with HI 24.79% 3.0–6.4% - - MIP Plus converted to PHF 23.86% 3.0–6.4% - - MIP Fixed/Graded/Plus 7% with HI 24.79% 7.0% - - MIP Fixed/Graded/Plus 7% converted to PHF 23.86% 7.0% - - MIP Fixed/Graded/Plus converted to DC with HI 21.89% - 4% Elective up to IRS limit MIP Fixed/Graded/Plus converted to DC with PHF 20.96% - 4% Elective up to IRS limit Pension Plus with HI 24.56% 3.0–6.4% 50% match up to

1.0% Automatically enrolled at 2%,

but can elect to change Pension Plus with PHF 23.63% 3.0–6.4% 50% match up to

1.0% Automatically enrolled at 2%,

but can elect to change 100% Defined Contribution 20.96% - 50% match up to

3.0% Automatically enrolled at 6%,

but can elect to change Healthcare Insurance Trust (HI) - 3.0% - - Personal Healthcare Fund (PHF) - - 100% match up to

2% Automatically enrolled at 2%,

but can elect to change

35

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 6. RETIREMENT PLANS – Continued MPSERS Defined Benefit Pension and Defined Contribution Plans – Continued

October 1, 2014 – June 30, 2015

Plan Description

Employer Defined Benefit

Employee Defined Benefit

Employer Defined Contribution

Employee Defined Contribution

Basic with Health Insurance Trust (HI) 25.78% - - - Basic converted to Personal Healthcare Fund (PHF) 25.27% - - - Basic 4% with HI 25.78% 4% - - Basic 4% converted to PHF 25.27% 4% - - Basic converted to DC with HI 21.47% - 4% Elective up to IRS limit Basic converted to DC with PHF 20.96% - 4% Elective up to IRS limit MIP Fixed with HI 25.78% 3.9% - - MIP Fixed converted to PHF 25.27% 3.9% - - MIP Graded with HI 25.78% 3.0–4.3% - - MIP Graded converted to PHF 25.27% 3.0–4.3% - - MIP Plus with HI 25.78% 3.0–6.4% - - MIP Plus converted to PHF 25.27% 3.0–6.4% - - MIP Fixed/Graded/Plus 7% with HI 25.78% 7.0% - - MIP Fixed/Graded/Plus 7% converted to PHF 25.27% 7.0% - - MIP Fixed/Graded/Plus converted to DC with HI 21.47% - 4% Elective up to IRS limit MIP Fixed/Graded/Plus converted to DC with PHF 20.96% - 4% Elective up to IRS limit Pension Plus with HI 24.70% 3.0–6.4% 50% match up to

1.0% Automatically enrolled at 2%,

but can elect to change Pension Plus with PHF 24.19% 3.0–6.4% 50% match up to

1.0% Automatically enrolled at 2%,

but can elect to change 100% Defined Contribution 20.96% - 50% match up to

3.0% Automatically enrolled at 6%,

but can elect to change Healthcare Insurance Trust (HI) - 3.0% - - Personal Healthcare Fund (PHF) - - 100% match up to

2% Automatically enrolled at 2%,

but can elect to change

36

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 6. RETIREMENT PLANS – Continued MPSERS Defined Benefit Pension and Defined Contribution Plans – Continued The following table discloses pertinent information relative to MPSERS funding for the three-year period beginning July 1, 2012 through June 30, 2015. The table includes pension and healthcare benefit data combined for all four components of the MPSERS retirement system: the Basic Defined Benefit Plan, the MIP Defined Benefit Plan, the Pension Plus Defined Benefit Plan, and the Defined Contribution Plan administered by Voya Financial. It also includes the required employee contributions to the irrevocable healthcare trust that were effective beginning July 1, 2010. Year Ended June 30, 2015 2014 2013 Employer funding percentage range 24.19%-27.27% 23.20%-26.96% 23.20%-26.96% Total College payroll $40.0 million $40.3 million $41.5 million MPSERS covered compensation $30.7 million $31.4 million $32.3 million College contributions $7.9 million $7.9 million $8.0 million Employee contributions $2.2 million $2.2 million $2.1 million Measurement of the MPSERS Net Pension Liability – The plan’s net pension liability is to be measured as the total pension liability, less the amount of the pension plan’s fiduciary net position. In actuarial terms, this will be the accrued liability less the market value of assets (not the smoothed actuarial value of assets that is often encountered in actuarial valuations performed to determine the employer’s contribution requirement). MPSERS Plan Net Pension Liability –Non-University – The MPSERS total non-university net pension liability for the plan years ended September 30, was as follows:

2014 2013

Total pension liability $ 65,160,887,182 $ 62,859,499,994

Plan fiduciary net position 43,134,384,072 39,427,686,072

Net pension liability $ 22,026,503,110 $ 23,431,813,922

Plan fiduciary net position as a percentage of total pension liability 66.20%

Net pension liability as a percentage of covered employee payroll 250.11%

Year 1 MPSERS GASB Statement No. 68 implementation recognized a 0.00% change in the College’s proportionate share between beginning net pension liability and ending net pension liability.

37

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015

NOTE 6. RETIREMENT PLANS – Continued

MPSERS Defined Benefit Pension and Defined Contribution Plans – Continued

Proportionate Share of Net Pension Liability, Deferrals, and Pension Expense – At June 30, 2015, the College reported a liability of $80.7 million for its proportionate share of the net pension liability of MPSERS. 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 rolled forward from September 30, 2013. The College’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 College’s proportion was .36636%, which was unchanged from its proportion measured as of September 30, 2013. For the year ended June 30, 2015, the College recognized MPSERS pension expense of $6.5 million, and reported deferred outflows of resources and deferred inflows of resources related to the MPSERS pension from the following sources:

Deferred Outflows of Resources

Deferred Inflows of Resources

Changes of assumptions $ 2,977,503 $ -

Net difference between projected and actual earnings on pension plan assets - 8,920,954

Changes in proportion and differences between College contributions and proportionate share of contributions

2,063 -

College contributions subsequent to the measurement date 5,161,281 -

Total $ 8,140,847 $ 8,920,954

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 $ 1,455,460 2017 1,455,460 2018 1,455,460 2019 1,575,008

Total $ 5,941,388

In addition, the contributions subsequent to the measurement date will be included as a reduction of the net pension liability in the next year.

38

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 6. RETIREMENT PLANS – Continued MPSERS Defined Benefit Pension and Defined Contribution Plans – Continued Rate of Return, Discount Rate and Long-term Expected Rate of Return – For the fiscal year ended September 30, 2014, the annual money-weighted rate of return on pension plan investment, net of pension plan investment expense, was 12.58%. The money weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested. The discount rate used to measure the total pension liability was 8.0% for the Basic and MIP Plans and 7.0% for the Pension Plus Plan. The projection of cash flows used to determine the discount rate assumed that employee member contributions will be made at the current contribution rate and that employer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the employee member rate. Based on these assumptions, the pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. 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. 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 as of September 30, 2014 are summarized in the following table:

Investment Category

Target Allocation

Long-term Expected Real Rate of Return

Domestic Equity Pools 28.0% 4.8% Private Equity Pools 18.0 8.5 International Equity Pools 16.0 6.1 Fixed Income Pools 10.5 1.5 Real Estate & Infrastructure Pools 10.0 5.3 Real Return, Opportunistic, and Absolute Pools 15.5 6.3 Short-Term Investment Pools 2.0 (.2)

Total 100.0%

Sensitivity of the Net Pension Liability to Changes in the Discount Rate – The following presents the net pension liability of the College, calculated using the discount rate of 8.0% for the Basic and MIP Plans and 7.0% for the Pension Plus Plan, as well as what the College’s net pension liability would be if it were calculated using a discount rate that is 1.0% point lower (7.0% for the Basic and MIP Plans and 6.0% for the Pension Plus Plan) or 1.0% point higher (9.0% for the Basic and MIP Plans and 8.0% for the Pension Plus Plan) than the current rates:

Net Pension Liability at 1.0% Decrease (7.0% for Basic and MIP Plans, and

6.0% for Pension Plus Plan)

Net Pension Liability at Current Discount Rate (8.0% for Basic and MIP Plans, and

7.0% for Pension Plus Plan)

Net Pension Liability at 1.0% Increase (9.0% for Basic and MIP Plans, and

8.0% for Pension Plus Plan)

$ 106,390,396 $ 80,695,808 $ 59,047,738

39

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 6. RETIREMENT PLANS – Continued MPSERS Defined Benefit Pension and Defined Contribution Plans – Continued Timing of the Valuation – An actuarial valuation to determine the total pension liability is required to be performed every year. If the actuarial valuation is not calculated as of the plan’s fiscal year end, the total pension liability is required to be rolled forward from the actual valuation date to the pension plan’s fiscal year end. The total pension liability as of September 30, 2014 is based on the results of an actuarial valuation date of September 30, 2013 and rolled forward using generally accepted actuarial procedures. Actuarial Valuations and Assumptions – Actuarial valuations for the pension plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions (ARC) are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing the benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. The total pension liability in the September 30, 2014 actuarial valuation 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 8.0% for Basic and MIP Plans and 7.0% for Pension Plus Plan, net of investment and administrative expenses

Wage inflation rate 3.5%

Rate of pay increases 3.5 to 12.3%, including wage inflation at 3.5%

Cost-of-living pension adjustments 3% annual non-compounded for MIP members

Healthcare cost trend rate 8.5% Year 1 graded to 3.5% Year 12

Mortality basis RP-2000 Combined Healthy Mortality Table, adjusted for mortality improvements to 2025 using projection scale BB

The actuarial assumptions used for the June 30, 2015 valuation were based on the results of an actuarial experience study for the period October 1, 2007 to September 30, 2012. As a result of this study, the actuarial assumptions were adjusted to more closely reflect actual experience.

40

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 6. RETIREMENT PLANS – Continued MPSERS Defined Benefit Pension and Defined Contribution Plans – Continued

Pension Plan Fiduciary Net Position – Detailed information about the MPSERS pension plan’s fiduciary net position is available in the separately issued MPSERS CAFR, as previously noted. Payable to the Pension Plan – As of June 30, 2015, the College reported a payable of $745,000 for the outstanding amount of required contributions to MPSERS for the year then ended, which included the UAAL pass-through payments due to MPSERS. ORP Defined Contribution Plan As an alternative pension option, the College offers all full-time faculty and full-time salaried administrative, professional and Corporate Services employees the opportunity to participate in an Optional Retirement Plan (ORP) administered by Teachers’ Insurance and Annuity Association - College Retirement Equities Fund (TIAA-CREF). Upon eligibility to participate in the ORP, employees have 90 days in which to elect participation in either the ORP or the MPSERS plan. The election becomes irrevocable after the 90-day period. Funding for the ORP consists entirely of employer contributions of 10% of each participating employee’s includable compensation. Participants are immediately 100% vested in all ORP contributions. Participating employees elect their own allocation of contributions among the available investment vehicles offered by TIAA-CREF. ORP retirement benefits are based on the accumulation of contributions and the related investment income for each participant. Distribution of retirement benefits is available under the ORP when participants attain age 55, or upon separation of employment. During the years ended June 30, 2015 and 2014, compensation covered under the ORP approximated $7.4 million and $7.1 million, respectively, which resulted in contributions by the College of approximately $739,000 and $707,000. NOTE 7. MNJTP BONDS PAYABLE During the year ended June 30, 2012, the College became involved in the Michigan New Jobs Training Program (MNJTP). This program was created by the State of Michigan Public Acts 359 and 360 of 2008, and authorizes community college districts to enter into an agreement with an employer to (1) provide worker education and job training in order to create new jobs, and (2) establish a funding mechanism to pay for the education and training for persons employed in new jobs with the employer. The employer prepays training costs to the College, and the College subsequently issues non-interest bearing revenue bonds payable to the employer equal to the prepayments. The employer remits state income tax withholdings for these new employees directly to the College. The College then remits the state income tax withholdings back to the employer on a quarterly basis to reimburse the employer for the costs of the training, thus reducing the College’s MNJTP bonds payable. Any outstanding bonds payable to the employer are offset by a state income tax receivable from the company of an equal amount.

41

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 7. MNJTP BONDS PAYABLE – Continued

In connection with this program, during the year ended June 30, 2012, the College entered into a MNJTP agreement with Xalt Energy MI, LLC (formerly Dow Kokam MI, LLC), which provided for a maximum bond principal amount of $6,190,000. Under this agreement, during the years ended June 30, 2015 and 2014, respectively, the College issued bond principal to the company totaling $303,000 and $80,000 and repaid bond principal of $317,000 and $114,000. There were no outstanding MNJTP bonds payable and offsetting accounts receivable with Xalt Energy as of June 30, 2015, but as of June 30, 2014, the balance was $14,000, all which was due to be repaid in less than one year. As of June 30, 2015, total bonds issued to date under this agreement total $854,000. During the year ended June 30, 2013, the College entered into a MNJTP agreement with ECO-Bio Plastics Midland, Inc., with the maximum bond principal issue amount of $200,000. For the year ended June 30, 2015, the College issued no bond principal to the company, whereas $14,000 was issued during the year ended June 30, 2014. Additionally, for each year 2015 and 2014, respectively, the College repaid bond principal of $14,000 and $16,000, and had outstanding MNJTP bonds payable and offsetting accounts receivable of $7,000 and $21,000, all which was due to be repaid in less than one year. As of June 30, 2015, total bonds issued to date under this agreement total $39,000. NOTE 8. OPERATING LEASE OBLIGATIONS The College leases various training facilities under short-term operating leases, with total lease expense approximating $30,000 for each of the years ended June 30, 2015 and 2014. At June 30, 2015, the College has noncancellable future lease payments totaling $31,000 scheduled to be paid during the year ending June 30, 2016. NOTE 9. RISK MANAGEMENT The College participates in the Michigan Community College Risk Management Authority (Authority) with other Michigan-based community colleges for claims relating to auto, property and liability. The Authority provides a risk pool program that operates as a claims servicing pool for amounts up to member retention limits, and operates as a common risk-sharing management program for losses in excess of member retention amounts up to maximum coverage limits. The College pays an annual premium to the Authority and is responsible for a deductible and all costs, including damages, indemnification, and allocated loss adjustment expenses, for each claim that is within the College’s Self-Insured Retention (SIR) limit. The College also participates in the stop loss provision of the program, which is designed to limit the member’s maximum cash payments during each July 1 through June 30 year to costs falling within the College’s SIR limit. Reinsurance is purchased by the Authority to further limit the risk of loss. In addition, the College purchases commercial insurance for employee medical benefits and employee injuries (workers’ compensation).

42

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015

NOTE 10. CONTINGENT LIABILITIES In the normal course of activities, the College is party to various legal actions. The College is of the opinion that the outcome of asserted claims outstanding will not have a material effect on the financial statements. NOTE 11. CONTRACTUAL COMMITMENTS The College has outsourced the management and operational support of its information technology services. During the year ended June 30, 2007, the College renewed its contract with Ellucian for an additional seven-year term, with the new contract period beginning November 2006 and ending October 2013. During the year ended June 30, 2010, Ellucian offered a Valued Partner Renewal Option to the College that was approved and accepted. The terms of the early renewal include an annual cost reduction beginning November 2010 and a three-year contract extension through October 2016. The 10-year fee schedule calls for monthly payments ranging from $173,000 to $193,000 through October 2016, with a total contractual commitment of $22.1 million over the amended 10-year contract period. The contract also provides for annual payment adjustments based on the Consumer Price Index. NOTE 12. CAPITAL CONSTRUCTION PROJECTS In December 2010, the State of Michigan approved planning for the Health Professions Building Renovation Project. In June 2012, the State approved funding for this $20.0 million project, which was 50% funded by the State, with the balance covered by donations and College reserves. The College began construction in March 2013, and the project was substantially completed by the end of August 2013 for the start of the 2013 fall semester. As of June 30, 2015, final project expenses totaled $18.0 million, toward which the College received $5.7 million in donations and pledges and $9.0 million in state capital appropriations. The College was required to spend its 50% share of the total project cost before any of the State funds were received, and recognized State capital appropriation revenue of $2.1 million during 2015, and has a related receivable of $1.3 million due from the State as of June 30, 2015. NOTE 13. ENDOWMENT SPENDING RATE POLICY The Investment and Distribution Policy for Endowment Funds as adopted by the Board of Trustees authorizes spending of the net appreciation (realized and unrealized) of the investments of endowment funds. Any net appreciation that is distributed is required to be spent for the purposes for which the endowment was established. Under the policy established by the Board, four percent of the previous five-year quarterly moving average market value of each individual endowment is authorized to be distributed annually, although actual distribution is limited to not decrease the individual endowment balances below that of the cumulative original value of the endowment contributions.

43

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 14. DELTA COLLEGE FOUNDATION The Delta College Foundation (the Foundation) is an independent tax-exempt 501(c)(3) corporation formed for the purpose of receiving funds for the sole benefit of the College. Contributions received by the Foundation are transferred to the College to be used in the support of the College’s educational programs. Such activities include contributing funds to the College’s scholarship programs and endowment funds, supplementing or paying for professional development activities of the College’s faculty and staff, and transferring donated equipment to the College to be used in general and occupational education programs. The College provides personnel support, supplies and equipment to the Foundation. Based on the criteria set forth in GASB Statement No. 61, the Foundation is considered a component unit of Delta College. Accordingly, the activity and financial position of the Foundation have been blended with the College’s in the accompanying financial statements. The Delta College Foundation issues a financial report that includes financial statements and supplementary information. That report may be obtained by writing to Delta College Foundation at 1961 Delta Road, University Center, MI 48710. Condensed financial information for the Foundation is provided below:

Delta College Foundation Condensed Balance Sheets

June 30, 2015 2014

Assets Current assets $ 1,794,433 $ 1,172,426 Long-term assets 1,292,560 570,796

Total Assets 3,086,993 1,743,222 Liabilities Current liabilities 48,098 3,019 Net Position Donor-restricted endowments 1,109,900 23,618 Restricted-expendable 1,604,734 1,443,411 Unrestricted 324,261 273,174

Total Net Position $ 3,038,895 $ 1,740,203

44

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 14. DELTA COLLEGE FOUNDATION – Continued

Delta College Foundation Condensed Statements of Revenue, Expenses and Changes in Net Position

Year Ended June 30, 2015 2014

Operating Revenue $ - $ - Operating Expenses Institutional administration 109,438 18,735 Fundraising 39,294 65,834

Total Operating Expenses 148,732 84,569

Operating Loss (148,732) (84,569) Nonoperating Revenue (Expenses) Gifts 5,138,084 952,764 Special events 69,829 111,076 Investment income 85,560 49,204 Foundation grants and distributions to or for Delta College

(3,846,049)

(1,755,227)

Net Nonoperating Revenue (Expenses) 1,447,424 (642,183)

Net Income (Loss) Before Other Revenue 1,298,692 (726,752) Other Revenue Capital gifts and grants - 173,355

Increase (Decrease) in Net Position 1,298,692 (553,397) Net Position Beginning of year 1,740,203 2,293,600

End of year $ 3,038,895 $ 1,740,203

45

NOTES TO FINANCIAL STATEMENTS - Continued DELTA COLLEGE JUNE 30, 2015 NOTE 14. DELTA COLLEGE FOUNDATION – Continued

Delta College Foundation Condensed Statements of Cash Flows

Year Ended June 30, 2015 2014

Net Cash Used in Operating Activities

$ (147,153)

$ (230,902)

Net Cash Used in Noncapital Financing Activities

(356,720)

(659,274)

Net Cash Provided by Capital and Related Financing Activities

490,925

958,603

Net Cash Provided by Investing Activities 85,560 401,627

Net Increase in Cash and Cash Equivalents

72,612

470,054

Cash and Cash Equivalents Beginning of year 800,419 330,365

End of year $ 873,031 $ 800,419

REQUIRED SUPPLEMENTARY INFORMATION

SCHEDULE OF PROPORTIONATE SHARE OF NET PENSION LIABILITY AND CONTRIBUTIONS

FOR MICHIGAN PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM (MPSERS)

DELTA COLLEGE

JUNE 30, 2015

2015

Delta College's proportion of the collective MPSERS

net pension liability:

As a percentage 0.36636%

Amount 80,695,808$

Delta College's covered employee payroll 30,260,280$

Delta College's proportionate share of the collective

pension liability, as a percentage of the

College's covered employee payroll 266.7%

MPSERS fiduciary net position, as a percentage of

the total pension liability 66.2%

Delta College's statutorily required contributions 6,412,460$

Delta College's contributions in relation to the actuarily

determined contractually required contribution 6,412,460

Delta College's contribution deficiency (excess) -$

Delta College's covered employee payroll 29,660,019$

Delta College contributions as a percentage of

covered employee payroll 21.6%

Changes of benefit terms: There were no changes of benefit terms in 2015.

Changes of assumptions: There were no changes of benefit assumptions in 2015.

SCHEDULE OF PROPORTIONATE SHARE OF MPSERS NET PENSION LIABILITY

SCHEDULE OF MPSERS CONTRIBUTIONS

NOTES TO REQUIRED SUPPLEMENTARY INFORMATION

46

SUPPLEMENTAL SCHEDULES OF OTHER FINANCIAL INFORMATION

CONSOLIDATING BALANCE SHEET

DELTA COLLEGE

JUNE 30, 2015MPSERS

AUXILIARY EXPENDABLE RETIREMENT

COMBINED GENERAL DESIGNATED ACTIVITIES RESTRICTED ENDOWMENT PLANT GASB 68 DEBT AGENCY

TOTAL ELIMINATION FUND FUND FUND FUND FUND FUND FUND FUND FUND FOUNDATION

ASSETS

CURRENT ASSETS

Cash and cash equivalents 30,254,825$ -$ 4,158,839$ 105,690$ 3,208,248$ 3,018,410$ 509,787$ 18,219,983$ -$ 28,506$ 132,331$ 873,031$

Short-term investments 14,486,019 - 1,986,640 3,498,465 3,004,387 - - 5,996,527 - - - -

Property taxes receivable 226,679 - 226,679 - - - - - - - - -

State appropriations receivable 4,432,780 - 3,135,694 - - - - 1,297,086 - - - -

Federal and state grants receivable 1,362,857 - 65,158 579,420 - 718,279 - - - - - -

Accounts receivable 659,792 - 21,964 615,193 - 550 - 15,000 - 7,085 - -

Pledges receivable 921,402 - - - - - - - - - - 921,402

Inventories 1,167,001 - 165,580 - 1,001,421 - - - - - - -

Prepaid expenses and other assets 399,656 - 169,210 24,000 - 169,977 12,167 24,302 - - - -

Due from (to) other funds - - - (78,361) - 78,361 - - - - - -

TOTAL CURRENT ASSETS 53,911,011 - 9,929,764 4,744,407 7,214,056 3,985,577 521,954 25,552,898 - 35,591 132,331 1,794,433

LONG-TERM INVESTMENTS 26,697,269 - 2,906,707 912,676 - - 18,971,164 3,906,722 - - - -

LONG-TERM PLEDGES RECEIVABLE 1,292,560 - - - - - - - - - - 1,292,560

CAPITAL ASSETS

Land and improvements 9,671,630 - - - - - - 9,671,630 - - - -

Infrastructure 11,064,471 - - - - - - 11,064,471 - - - -

Buildings 118,813,330 - - - - - - 118,813,330 - - - -

Furniture and equipment 15,904,718 - - - - - - 15,904,718 - - - -

Fine art collection 88,752 - - - - - - 88,752 - - - -

Construction in progress 1,195,865 - - - - - - 1,195,865 - - - -

Allowance for depreciation (57,044,488) - - - - - - (57,044,488) - - - -

TOTAL CAPITAL ASSETS 99,694,278 - - - - - - 99,694,278 - - - -

TOTAL ASSETS 181,595,118 - 12,836,471 5,657,083 7,214,056 3,985,577 19,493,118 129,153,898 - 35,591 132,331 3,086,993

LIABILITIES

CURRENT LIABILITIES

Accounts payable 2,578,122 - 731,957 170,132 28,429 561,764 - 920,405 - 28,506 132,331 4,598

Accrued payroll and other compensation 4,943,791 - 4,391,520 287,214 145,459 119,598 - - - - - -

Unearned revenue 1,206,188 - 923,227 222,994 - 9,142 7,325 - - - - 43,500

Current portion of MNJTP bonds payable 7,085 - - - - - - - - 7,085 - -

TOTAL CURRENT LIABILITIES 8,735,186 - 6,046,704 680,340 173,888 690,504 7,325 920,405 - 35,591 132,331 48,098

NON-CURRENT LIABILITIES

Net pension liability 80,695,808 - - - - - - - 80,695,808 - - -

TOTAL LIABILITIES 89,430,994 - 6,046,704 680,340 173,888 690,504 7,325 920,405 80,695,808 35,591 132,331 48,098

DEFERRED INFLOWS OF RESOURCES 780,107 - - - - - - - 780,107 - - -

NET POSITION

Net investment in capital assets 99,694,278 - - - - - - 99,694,278 - - - -

Restricted for:

Donor-restricted endowments 14,604,646 - - - - - 13,494,746 - - - - 1,109,900

Expendable scholarships and awards 1,034,049 - - - - 798,284 - - - - - 235,765

Instructional department uses 2,182,324 - - - - 1,405,576 - - - - - 776,748

Public broadcasting activities 816,853 - - - - 816,853 - - - - - -

Other restricted uses 866,581 - - - - 274,360 - - - - - 592,221

Unrestricted (27,814,714) - 6,789,767 4,976,743 7,040,168 - 5,991,047 28,539,215 (81,475,915) - - 324,261

TOTAL NET POSITION 91,384,017$ -$ 6,789,767$ 4,976,743$ 7,040,168$ 3,295,073$ 19,485,793$ 128,233,493$ (81,475,915)$ -$ -$ 3,038,895$

47

SUPPLEMENTAL SCHEDULES OF OTHER FINANCIAL INFORMATION

CONSOLIDATING STATEMENT OF REVENUE, EXPENSES AND CHANGES IN NET POSITION

DELTA COLLEGE

YEAR ENDED JUNE 30, 2015 MPSERS

AUXILIARY EXPENDABLE RETIREMENT

COMBINED GENERAL DESIGNATED ACTIVITIES RESTRICTED ENDOWMENT PLANT GASB 68

TOTAL ELIMINATION FUND FUND FUND FUND FUND FUND FUND FOUNDATION

OPERATING REVENUE

Tuition and fees, net of scholarship allowance

of $7,711,906 in 2015 and $7,675,196 in 2014 22,453,957$ (7,711,906)$ 26,952,406$ 3,089,417$ -$ -$ -$ 124,040$ -$ -$

Federal grants and contracts 4,410,750 - - - - 4,410,750 - - - -

State grants and contracts 558,859 - - - - 558,859 - - - -

Local and nongovernmental grants and contracts 888,063 - - - - 888,063 - - - -

Public broadcasting gifts 626,566 - - - - 626,566 - - - -

Auxiliary activities, net of scholarship allowance -

of $1,544,590 in 2015 and $1,645,975 in 2014 5,388,203 (1,544,590) - - 6,932,793 - - - - -

Current year expenditures for capital -

equipment and facility improvements - (3,989,745) - - - - - 3,989,745 - -

Miscellaneous 915,945 (13,112) 408,129 308,361 - 197,936 - 14,631 - -

TOTAL OPERATING REVENUE 35,242,343 (13,259,353) 27,360,535 3,397,778 6,932,793 6,682,174 - 4,128,416 - -

OPERATING EXPENSES

Instruction 40,303,334 (629,468) 34,142,236 2,563,337 - 4,307,851 - - (80,622) -

Public services 2,558,923 (33,699) 919,225 2,013 - 1,667,795 - - 3,589 -

Instructional support 7,793,010 (12,887) 7,522,294 92,173 - 182,277 - - 9,153 -

Student services 22,695,860 (9,347,602) 6,801,700 94,288 6,298,240 18,690,972 - 166,833 (8,571) -

Institutional administration 8,253,296 (5,893) 7,357,475 791,000 - - - - 1,276 109,438

Operation and maintenance of facilities 7,249,469 (3,216,692) 6,363,963 - - 8,973 - 4,096,403 (3,178) -

Depreciation expense 4,582,680 - - - - - - 4,582,680 - -

Fundraising expenses 39,294 - - - - - - - - 39,294

Other expenses - (573,471) - - - - 573,471 - - -

TOTAL OPERATING EXPENSES 93,475,866 (13,819,712) 63,106,893 3,542,811 6,298,240 24,857,868 573,471 8,845,916 (78,353) 148,732

OPERATING INCOME (LOSS) (58,233,523) 560,359 (35,746,358) (145,033) 634,553 (18,175,694) (573,471) (4,717,500) 78,353 (148,732)

NONOPERATING REVENUE (EXPENSES)

State appropriations 17,337,374 - 17,337,374 - - - - - - -

Property tax levy 22,931,569 - 22,931,569 - - - - - - -

Pell federal grant revenue 16,992,112 - - - - 16,992,112 - - - -

Gifts 3,799,757 (3,456,980) 37,362 144,309 - 1,761,126 151,151 24,705 - 5,138,084

Special events, net of expenses of -

$53,122 in 2015 and $77,706 in 2014 69,829 - - - - - - - - 69,829

Investment income (loss), net of Endowment Fund investment -

expense of $149,866 in 2015 and $147,041 in 2014 988,888 (573,471) 218,516 90,919 - 374,559 560,919 231,886 - 85,560

Loss on disposition of capital assets (183,995) 13,112 - - - - - (197,107) - -

Foundation grants and distributions to or for Delta College (160,640) 3,788,397 - - - - (102,988) - - (3,846,049)

NET NONOPERATING REVENUE (EXPENSES) 61,774,894 (228,942) 40,524,821 235,228 - 19,127,797 609,082 59,484 - 1,447,424

NET INCOME (LOSS) BEFORE OTHER REVENUE 3,541,371 331,417 4,778,463 90,195 634,553 952,103 35,611 (4,658,016) 78,353 1,298,692

OTHER REVENUE

State capital appropriations 2,069,343 - - - - - - 2,069,343 - -

Capital gifts and grants - (331,417) - - - - - 331,417 - -

Additions to permanent endowments 1,447,632 - - - - - 1,447,632 - - -

TOTAL OTHER REVENUE 3,516,975 (331,417) - - - - 1,447,632 2,400,760 - -

INCREASE (DECREASE) IN NET POSITION 7,058,346 - 4,778,463 90,195 634,553 952,103 1,483,243 (2,257,256) 78,353 1,298,692

TRANSFERS IN (OUT) - - (4,757,096) (182,164) (303,130) 173,350 181,342 4,887,698 - -

NET INCREASE (DECREASE) IN NET POSITION 7,058,346 - 21,367 (91,969) 331,423 1,125,453 1,664,585 2,630,442 78,353 1,298,692

NET POSITION - BEGINNING OF YEAR

Beginning of year 165,879,939 - 6,768,400 5,068,712 6,708,745 2,169,620 17,821,208 125,603,051 - 1,740,203

Adjustment for change in accounting principle (Note 1) (81,554,268) - - - - - - - (81,554,268) -

NET POSITION - BEGINNING OF YEAR, AS RESTATED 84,325,671 - 6,768,400 5,068,712 6,708,745 2,169,620 17,821,208 125,603,051 (81,554,268) 1,740,203 -$ -$ -$ -$ -$ -$ -$ -$ -$

NET POSITION - END OF YEAR 91,384,017$ -$ 6,789,767$ 4,976,743$ 7,040,168$ 3,295,073$ 19,485,793$ 128,233,493$ (81,475,915)$ 3,038,895$

48

SUPPLEMENTAL SCHEDULES OF OTHER FINANCIAL INFORMATION

DETAILS OF CERTAIN GENERAL FUND REVENUES

DELTA COLLEGE

YEAR ENDED JUNE 30, 2015

TUITION AND FEES

Tuition 20,385,570$

Registration fees 868,276

Course and program fees:

Excess contact hour fees 2,080,709

Technology fees 2,398,397

Nursing & Dental Hygiene program fees 171,451

Online course fees 946,540

Auto course fees 32,589

Other fees 68,874

TOTAL TUITION AND FEES 26,952,406$

MISCELLANEOUS REVENUE

Collegiate ads 6,330$

Credit by exam 6,614

Live scan fees 23,660

Miscellaneous 169,347

Parking fines 3,586

Planetarium ticket sales 54,959

Rental of college facilities 85,143

Reserve parking 12,183

Testing 46,307

TOTAL MISCELLANEOUS REVENUE 408,129$

49

DELTA COLLEGE

YEAR ENDED JUNE 30, 2015

PROFESSIONAL

FRINGE SUPPLIES CAPITAL DEVELOPMENT

SALARIES BENEFITS & SERVICES EXPENDITURES & TRAVEL TOTAL

INSTRUCTION

Social Sciences 3,092,798$ 1,486,539$ 26,677$ -$ 29,850$ 4,635,864$

Humanities 2,272,898 1,080,295 43,063 - 21,890 3,418,146

English 2,974,966 1,467,817 23,287 - 28,671 4,494,741

Mathematics & Computer Science 2,011,023 1,028,523 37,878 - 18,905 3,096,329

Sciences 3,223,249 1,458,681 111,944 - 32,994 4,826,868

Business & Information Technology 2,627,806 1,266,280 28,863 - 24,378 3,947,327

Health & Wellness 3,863,774 1,958,618 234,287 - 38,218 6,094,897

Technical Trades & Manufacturing 1,871,904 920,520 208,569 - 22,215 3,023,208

Instructional Equipment - - 563,472 41,384 - 604,856

TOTAL INSTRUCTION 21,938,418 10,667,273 1,278,040 41,384 217,121 34,142,236

PUBLIC SERVICES

Television 329,360 188,824 - - 3,125 521,309

Public Radio 59,340 31,711 20 - 219 91,290

Planetarium and Learning Center 181,475 81,187 27,385 - 1,974 292,021

President's Speakers Series - - 14,605 - - 14,605

TOTAL PUBLIC SERVICES 570,175 301,722 42,010 - 5,318 919,225

INSTRUCTIONAL SUPPORT

Office of Vice President of Instruction & Learning Services 178,491 63,392 4,954 - 5,722 252,559

Division Chairs 809,631 336,692 15,803 - 10,351 1,172,477

Academic Deans 362,901 217,773 8,228 - 7,637 596,539

Faculty Secretarial & Instructional Support 491,831 323,877 62,460 - 3,277 881,445

Instructional Support Information Technology - - 1,308,396 - - 1,308,396

Computer & Multimedia Laboratories 207,495 55,115 74,935 - 775 338,320

Library & Learning Resources Center 494,878 262,676 140,411 - 3,956 901,921

Teaching Learning and WRIT Centers 369,175 181,585 1,323 - 1,900 553,983

Academic Testing Center 115,069 65,066 235 - 596 180,966

Instructional Media Technology 93,454 28,716 26,581 - 500 149,251

Fitness & Aquatics Center Instructional Support 107,213 50,299 26,851 12,887 500 197,750

Developmental Education - - 765 - 1,590 2,355

Teaching Enhancement Centers 13,991 10,573 32,055 - 10,800 67,419

Center for Organizational Success 50,148 37,550 19,841 - 2,505 110,044

Accreditation & Assessment - - 18,647 - 1,956 20,603

Community Development & Strategic Partnerships 147,379 84,448 6,182 - 3,698 241,707

Service Learning & Community Engagement 84,564 54,354 26,579 - 1,572 167,069

Honors Program 1,235 - 7,219 - 624 9,078

eLearning 155,589 92,895 94,202 - 27,726 370,412

TOTAL INSTRUCTIONAL SUPPORT 3,683,044 1,865,011 1,875,667 12,887 85,685 7,522,294

SUPPLEMENTAL SCHEDULES OF OTHER FINANCIAL INFORMATION

DETAILS OF GENERAL FUND OPERATING EXPENSES

50

DELTA COLLEGE

YEAR ENDED JUNE 30, 2015

PROFESSIONAL

FRINGE SUPPLIES CAPITAL DEVELOPMENT

SALARIES BENEFITS & SERVICES EXPENDITURES & TRAVEL TOTAL

SUPPLEMENTAL SCHEDULES OF OTHER FINANCIAL INFORMATION

DETAILS OF GENERAL FUND OPERATING EXPENSES - Continued

STUDENT SERVICES

Office of Vice President of Student & Education Services 191,435$ 106,825$ 21,226$ -$ 5,089$ 324,575$

Dean of Students 63,539 19,001 43,577 - 1,974 128,091

Dean of Enrollment Services 56,051 18,864 9,415 - 1,991 86,321

Admissions 307,885 204,886 66,591 - 5,211 584,573

Records & Registration 343,057 212,263 35,952 - 2,754 594,026

Counseling & Advising 769,957 438,286 7,795 - 7,090 1,223,128

Financial Aid 498,356 302,262 19,768 - 9,755 830,141

Enrollment Management & Student Goodwill - - 67,232 - 13,704 80,936

Student Engagement, Leadership, & Organizations 74,255 47,994 46,140 - 6,588 174,977

Career & Employment Services 156,430 78,680 18,685 - 1,075 254,870

Marketing & Publications - - 416,727 - 557 417,284

Veteran Services 70,256 42,057 1,219 - 800 114,332

Student Services Support Information Technology - - 492,172 - - 492,172

Collegiate Student Newspaper 43,216 4,286 12,818 - 329 60,649

Disability Resources 50,767 18,426 52,846 - 751 122,790

Commencement & Student Awards - - 17,402 - - 17,402

Possible Dream Program 47,851 26,144 627 - 500 75,122

Student Testing & Assessment 82,547 51,650 34,373 - 775 169,345

Scholarships & Grants - - 246,699 - - 246,699

Ricker Center 88,443 53,304 111,109 - 500 253,356

Midland Center 58,634 40,586 2,221 - 500 101,941

Learning Centers & Innovative Programs 2,430 1,030 2,852 - - 6,312

Athletic Programs 172,535 72,591 126,251 - 71,281 442,658

TOTAL STUDENT SERVICES 3,077,644 1,739,135 1,853,697 - 131,224 6,801,700

51

DELTA COLLEGE

YEAR ENDED JUNE 30, 2015

PROFESSIONAL

FRINGE SUPPLIES CAPITAL DEVELOPMENT

SALARIES BENEFITS & SERVICES EXPENDITURES & TRAVEL TOTAL

SUPPLEMENTAL SCHEDULES OF OTHER FINANCIAL INFORMATION

DETAILS OF GENERAL FUND OPERATING EXPENSES - Continued

INSTITUTIONAL ADMINISTRATION

Board of Trustees -$ -$ 18,887$ -$ 21,213$ 40,100$

Development Office 311,157 185,936 26,244 - 3,881 527,218

Equity Office 28,409 15,780 128 - 484 44,801

President's Office 370,352 188,416 19,232 - 21,915 599,915

Memberships - - 116,295 - 4,230 120,525

Miscellaneous - - 36,635 - 5,091 41,726

Strategic Planning - - 23,340 - 6,580 29,920

Legal 45,769 20,773 56,298 - 275 123,115

Audit - - 51,454 - - 51,454

Bank Fees, Collection Expenses & Bad Debts - - 675,148 - - 675,148

Insurance, Unemployment & Other - 46,892 404,020 - - 450,912

Communications Technology 79,005 49,461 116,984 - 425 245,875

Business Services 265,448 166,839 9,740 - 2,077 444,104

Finance Office 726,434 413,050 49,396 - 11,215 1,200,095

Administrative Support Information Technology 39,928 22,566 951,092 - - 1,013,586

Human Resources & Staff Recruitment 429,332 241,708 57,748 - 11,458 740,246

Senate 28,453 11,725 2,663 - 2,587 45,428

Post Office 55,352 26,496 3,983 - 275 86,106

Institutional Advancement 307,419 167,909 6,943 - 6,103 488,374

Institutional Research 222,404 128,575 6,024 - 2,027 359,030

Wellness & Professional Development 950 2,763 24,550 - 1,534 29,797

TOTAL INSTITUTIONAL ADMINISTRATION 2,910,412 1,688,889 2,656,804 - 101,370 7,357,475

OPERATION AND MAINTENANCE OF FACILITIES

Public Safety 382,127 233,698 41,920 43,420 2,416 703,581

Facilities Management 699,723 397,828 6,035 - 10,928 1,114,514

Facility Operations 1,473,598 901,994 178,134 28,036 1,500 2,583,262

Utilities - - 1,350,538 - - 1,350,538

Facility Maintenance & Improvements - - 318,708 - - 318,708

Off-Campus Centers & President's House - - 293,360 - - 293,360

TOTAL OPERATION AND MAINTENANCE OF FACILITIES 2,555,448 1,533,520 2,188,695 71,456 14,844 6,363,963

TOTAL GENERAL FUND OPERATING EXPENSES 34,735,141$ 17,795,550$ 9,894,913$ 125,727$ 555,562$ 63,106,893$

52

SUPPLEMENTAL SCHEDULES OF OTHER FINANCIAL INFORMATION

DETAILS OF DESIGNATED FUND

DELTA COLLEGE

YEAR ENDED JUNE 30, 2015 EXPENSES

ENDOWMENT PROFESSIONAL

NET AND SUPPLIES DEVELOPMENT NET INCREASE NET

POSITION TUITION MISCELLANEOUS INVESTMENT TOTAL FRINGE AND CAPITAL AND TOTAL TRANSFERS (DECREASE) IN POSITION

JULY 1, 2014 AND FEES REVENUE GIFTS INCOME REVENUE SALARIES BENEFITS SERVICES EXPENDITURES TRAVEL EXPENSES IN(OUT) NET ASSETS JUNE 30, 2015

INSTRUCTION

Corporate Services 1,064,804$ 1,741,268$ -$ -$ -$ 1,741,268$ 1,106,759$ 358,116$ 319,907$ -$ 2,170$ 1,786,952$ -$ (45,684)$ 1,019,120$

Criminal Justice Training Programs (331,696) 398,252 210 - - 398,462 219,932 91,021 68,089 - 3,669 382,711 - 15,751 (315,945)

Lifelong Learning & 50+ Just Like Gold Programs (333,649) 214,075 397 - - 214,472 203,718 100,906 50,100 - 1,188 355,912 - (141,440) (475,089)

Kid's College & Youth Camps 28,881 55,179 - - - 55,179 16,781 5,356 15,597 - 28 37,762 - 17,417 46,298

TOTAL INSTRUCTION 428,340 2,408,774 607 - - 2,409,381 1,547,190 555,399 453,693 - 7,055 2,563,337 - (153,956) 274,384

PUBLIC SERVICES

Global Awareness 13,936 - - - 1,303 1,303 - - - - - - - 1,303 15,239

Delta Productions 3,247 - 5,523 - - 5,523 - - 1,513 - - 1,513 - 4,010 7,257

2YC3 Chemistry Conference 114 - - - - - - - - - - - - - 114

Telelearning Network 8,941 125 - - - 125 - - - - - - - 125 9,066

Sailing Program (72,229) - - - 998 998 - - 500 - - 500 - 498 (71,731)

TOTAL PUBLIC SERVICES (45,991) 125 5,523 - 2,301 7,949 - - 2,013 - - 2,013 - 5,936 (40,055)

INSTRUCTIONAL SUPPORT

President's Scholarship Program 359,005 - - - 65,971 65,971 - - - - - - (83,928) (17,957) 341,048

President's Innovation Projects 57,842 - - - - - 100 8 9,119 - 13,458 22,685 50,000 27,315 85,157

MEDC MEDC MAT2 Project - - 13,322 - - 13,322 9,099 3,063 474 - - 12,636 - 686 686

Faculty & Instructional Development 45,414 - 66,321 - - 66,321 2,348 492 29,142 - 17,231 49,213 - 17,108 62,522

Developmental Education 4,156 - - - - - - - - - - - - - 4,156

Library Resource Replacement 9,543 - 4,990 - - 4,990 - - 3,005 - - 3,005 - 1,985 11,528

Photography Lab Printing 3,459 - 1,982 - - 1,982 - - 2,134 - - 2,134 - (152) 3,307

Kenya Partnership - - 23,685 - - 23,685 - - 1,300 - - 1,300 - 22,385 22,385

Art & Archive Projects 27,750 - - - 10,517 10,517 - - 1,200 - - 1,200 - 9,317 37,067

TOTAL INSTRUCTIONAL SUPPORT 507,169 - 110,300 - 76,488 186,788 11,547 3,563 46,374 - 30,689 92,173 (33,928) 60,687 567,856

STUDENT SERVICES

Student Service Learning Activities 1,109 - - - - - - - - - - - - - 1,109

Student Educational Services Activities 10,150 - 1,803 - - 1,803 - - 3,756 - - 3,756 - (1,953) 8,197

Computer Rental Program 2,770 - 2,720 - - 2,720 - - - - - - - 2,720 5,490

Math Calculator Program 2,164 - 7,225 - - 7,225 - - 4,283 - - 4,283 - 2,942 5,106

Student Skills Achievement Programs 4,183 - 4,895 962 - 5,857 - - 5,572 - - 5,572 - 285 4,468

Pioneer Athletic Fundraisers 7,089 - 52,422 32,283 - 84,705 - - 51,312 - 29,365 80,677 - 4,028 11,117

TOTAL STUDENT SERVICES 27,465 - 69,065 33,245 - 102,310 - - 64,923 - 29,365 94,288 - 8,022 35,487

INSTITUTIONAL ADMINISTRATION

Corporate Services Administration - 680,518 - - - 680,518 318,054 95,879 105,569 5,893 6,887 532,282 (148,236) - -

Whiting Projects 77,469 - - - - - - - - - - - - - 77,469

UNUM Projects 669,537 - - - 12,130 12,130 - - - - - - - 12,130 681,667

Technology Improvements 53,018 - - - - - - - - - - - - - 53,018

Flexible Spending Plan Administration 7,124 - 1,159 - - 1,159 - - - - - - - 1,159 8,283

Health Care Reform Administration 169,030 - 78,340 - - 78,340 - - 56,103 - - 56,103 - 22,237 191,267

Administrative Development & Projects 180,536 - 43,367 - - 43,367 - - 66,428 - 1,820 68,248 - (24,881) 155,655

Administrative Cost Reserve 3,083 - - - - - - - - - - - - - 3,083

Administrative Reserve for Tax Appeals 76,721 - - - - - - - - - - - - - 76,721

Self Insurance 2,915,211 - - - - - - - 23,303 - - 23,303 - (23,303) 2,891,908

Gifts In Kind - - - 111,064 - 111,064 - - 111,064 - - 111,064 - - -

TOTAL INSTITUTIONAL ADMINISTRATION 4,151,729 680,518 122,866 111,064 12,130 926,578 318,054 95,879 362,467 5,893 8,707 791,000 (148,236) (12,658) 4,139,071

TOTAL DESIGNATED FUND 5,068,712$ 3,089,417$ 308,361$ 144,309$ 90,919$ 3,633,006$ 1,876,791$ 654,841$ 929,470$ 5,893$ 75,816$ 3,542,811$ (182,164)$ (91,969)$ 4,976,743$

53

REVENUES

SUPPLEMENTAL SCHEDULES OF OTHER FINANCIAL INFORMATION

DETAILS OF AUXILIARY ACTIVITIES FUND

DELTA COLLEGE

YEAR ENDED JUNE 30, 2015

EXPENSES

NET SUPPLIES OPERATING NET

POSITION OPERATING FRINGE AND CAPITAL TOTAL INCOME TRANSFERS POSITION

JULY 1, 2014 REVENUES SALARIES BENEFITS SERVICES EXPENSES EXPENSES (LOSS) IN(OUT) JUNE 30, 2015

AUXILIARY ACTIVITIES

Bookstore 4,895,062$ 5,398,200$ 438,425$ 156,108$ 4,232,274$ -$ 4,826,807$ 571,393$ (300,000)$ 5,166,455$

Food Services 436,877 1,111,736 365,700 133,841 557,038 - 1,056,579 55,157 (2,929) 489,105

Fitness & Recreation Center 618,661 322,898 205,344 58,489 41,608 19,080 324,521 (1,623) (201) 616,837

Carlyon Farmhouse 5,325 - - - - - - - - 5,325

Planetarium Gift Shop & Conference Services (179) 33,653 9,588 1,320 22,247 - 33,155 498 - 319

Learning Resources Vending 17,147 190 - - - - - 190 - 17,337

TOTAL AUXILIARY ACTIVITIES 5,972,893 6,866,677 1,019,057$ 349,758$ 4,853,167$ 19,080$ 6,241,062 625,615 (303,130) 6,295,378

INTERNAL SERVICE OPERATIONS

Internal Service Operations 735,852 724,123 194,583$ 104,891$ 366,666$ 49,045$ 715,185 8,938 - 744,790

Elimination of Rebilled Charges - (658,007) (658,007) - - -

NET INTERNAL SERVICE OPERATIONS 735,852 66,116 57,178 8,938 - 744,790

TOTAL 6,708,745$ 6,932,793$ 6,298,240$ 634,553$ (303,130)$ 7,040,168$

54

SUPPLEMENTAL SCHEDULES OF OTHER FINANCIAL INFORMATION

DETAILS OF EXPENDABLE RESTRICTED FUND

DELTA COLLEGE

YEAR ENDED JUNE 30, 2015 REVENUES EXPENSES

LOCAL AND ENDOWMENT PROFESSIONAL

NET FEDERAL STATE NONGOVERNMENTAL AND SUPPLIES DEVELOPMENT NET INCREASE NET

POSITION GRANTS AND GRANTS AND GRANTS AND MISCELLANEOUS INVESTMENT TOTAL FRINGE AND CAPITAL AND TOTAL TRANSFERS (DECREASE) IN POSITION

JULY 1, 2014 CONTRACTS CONTRACTS CONTRACTS REVENUE GIFTS INCOME REVENUE SALARIES BENEFITS SERVICES EXPENDITURES TRAVEL EXPENSES IN(OUT) NET ASSETS JUNE 30, 2015

INSTRUCTION

Corporate Services Grants 81,498$ 2,853,795$ -$ 52,569$ -$ 91,000$ -$ 2,997,364$ 1,126,905$ 599,179$ 1,269,336$ -$ 5,081$ 3,000,501$ -$ (3,137)$ 78,361$

Motorcycle Safety Training Programs 388 - 73,744 - 18,150 875 - 92,769 62,779 21,984 8,006 - - 92,769 - - 388

Endowed Teaching Chair Program 47,857 - - - - 1,076 21,435 22,511 4,798 992 6,632 - 11,520 23,942 - (1,431) 46,426

Criminal Justice Training Programs - - 4,996 - - - - 4,996 1,100 365 3,531 - - 4,996 - - -

NSF TUES Grants - 23,603 - - - - - 23,603 11,031 2,388 2,848 6,600 736 23,603 - - -

League for Innovation Global Skills Grants 4,467 - - - - - - - - - 51 - 1,534 1,585 - (1,585) 2,882

MEDC CCSTEP Grant - - 382,408 - - - - 382,408 - - 263,254 332,848 - 596,102 213,694 - -

Wickes Foundation Instructional Program Projects 554 - - - - - - - - - - - - - - - 554

Middle School Manufacturing Experience Program 22,072 - - - - 4,500 - 4,500 4,500 1,469 10,874 - - 16,843 25,300 12,957 35,029

Michigan STEM Partnership Grant - - 4,500 - - - - 4,500 - - 4,500 - - 4,500 - - -

Dow Foundation STEM Explorer Program - - - - - 1,500,000 1,926 1,501,926 16,649 2,917 25,573 187,321 2,230 234,690 (25,300) 1,241,936 1,241,936

Perkins Voc Ed Grant - Instructional Equipment - 308,320 - - - - - 308,320 - - 247,005 61,315 - 308,320 - - -

TOTAL INSTRUCTION 156,836 3,185,718 465,648 52,569 18,150 1,597,451 23,361 5,342,897 1,227,762 629,294 1,841,610 588,084 21,101 4,307,851 213,694 1,248,740 1,405,576

PUBLIC SERVICE

Possible Dream Program 108,889 - - - - - 54,419 54,419 3,999 - 59,853 - 74 63,926 (577) (10,084) 98,805

Humanties Learning Center 5,997 - - - - - - - - - 1,351 - - 1,351 - (1,351) 4,646

EPA GLISTEN Stem Mastery Grant - 1,901 - - - - - 1,901 1,132 - - - 769 1,901 - - -

Lincoln & Civil War Exhibit Grants - 3,750 500 6,750 - 500 - 11,500 - - 11,500 - - 11,500 - - -

Summer Enrichment Math Program 760 - - - - - - - - - 760 - - 760 - (760) -

Planetarium Be A Star 156,961 - - - - - 21,273 21,273 - - 16,500 - - 16,500 - 4,773 161,734

Public Broadcasting - Television 894,084 - - 789,084 179,786 451,458 6,725 1,427,053 238,921 91,690 1,015,410 33,699 7,713 1,387,433 (199,803) (160,183) 733,901

Public Broadcasting - Radio 71,311 - - - - 175,108 3,793 178,901 65,508 23,499 93,616 - 1,801 184,424 17,164 11,641 82,952

TOTAL PUBLIC SERVICE 1,238,002 5,651 500 795,834 179,786 627,066 86,210 1,695,047 309,560 115,189 1,198,990 33,699 10,357 1,667,795 (183,216) (155,964) 1,082,038

INSTRUCTIONAL SUPPORT

Water Treatment Instruction Development 3,319 - - - - - - - - - 187 - - 187 - (187) 3,132

MEDC MAT2 CNC DACUM Grant - - 4,000 - - - - 4,000 1,936 640 1,177 - 247 4,000 - - -

Perkins Program of Study Grants - 2,799 - - - - - 2,799 2,041 758 - - - 2,799 - - -

Perkins CAP Leadership Grant - 11,444 - - - - - 11,444 - - - - 11,444 11,444 - - -

Perkins Voc Ed Grant - Professional & Curriculum Dev - 163,847 - - - - - 163,847 96,606 61,398 - - 5,843 163,847 - - -

TOTAL INSTRUCTIONAL SUPPORT 3,319 178,090 4,000 - - - - 182,090 100,583 62,796 1,364 - 17,534 182,277 - (187) 3,132

STUDENT SERVICES

Perkins Voc Ed Grant - Special Needs - 158,520 - - - - - 158,520 141,844 58,897 1,683 - 978 203,402 44,882 - -

MICUP/MTU Partnership Grant - - 5,709 - - - - 5,709 1,039 344 386 - 3,940 5,709 - - -

Michigan Nursing Board Scholarships Grant - - 29,827 - - - - 29,827 - - 29,827 - - 29,827 - - -

MEDC Career Liason Grant - - 51,905 - - - - 51,905 33,431 16,121 685 - 1,668 51,905 - - -

MCCA-MCSS Credit When Due & Win-Win Grants - - - 24,094 - - - 24,094 10,719 5,257 4,364 - 3,754 24,094 - - -

Title III Strengthening Institutions Program Grant - 209,488 - - - - - 209,488 148,850 52,556 6,600 - 1,482 209,488 - - -

Pell Grants - 16,992,112 - - - - - 16,992,112 - - 16,992,112 - - 16,992,112 - - -

Supplemental Educational Opportunity Grant - 378,237 - - - - - 378,237 - - 378,237 - - 378,237 - - -

Federal Workstudy Grant - 277,802 - - - - - 277,802 325,235 - 32,672 - - 357,907 80,105 - -

Job Locator and Development Grant - 17,244 - - - - - 17,244 12,335 4,809 - - 100 17,244 - - -

Federal Workstudy Off-Campus - - - 6,115 - - - 6,115 - - - - - - (6,115) - -

Scholarships & Awards 767,168 - - - - 163,175 264,988 428,163 5,100 380 415,567 - - 421,047 24,000 31,116 798,284

TOTAL STUDENT SERVICES 767,168 18,033,403 87,441 30,209 - 163,175 264,988 18,579,216 678,553 138,364 17,862,133 - 11,922 18,690,972 142,872 31,116 798,284

OPERATION AND MAINTENANCE OF FACILITIES

Sustainability Grants - - - 9,451 - - - 9,451 2,440 839 424 - 1,237 4,940 - 4,511 4,511

Michigan Justice Training & Drug Enforcement Grants 4,295 - 1,270 - - - - 1,270 - - 4,033 - - 4,033 - (2,763) 1,532

TOTAL OPERATION AND MAINTENANCE OF FACILITIES 4,295 - 1,270 9,451 - - - 10,721 2,440 839 4,457 - 1,237 8,973 - 1,748 6,043

TOTAL EXPENDABLE RESTRICTED FUND 2,169,620$ 21,402,862$ 558,859$ 888,063$ 197,936$ 2,387,692$ 374,559$ 25,809,971$ 2,318,898$ 946,482$ 20,908,554$ 621,783$ 62,151$ 24,857,868$ 173,350$ 1,125,453$ 3,295,073$

55

SUPPLEMENTAL SCHEDULE OF OTHER FINANCIAL INFORMATION

DETAILS OF ENDOWMENT FUND

YEAR ENDED JUNE 30, 2015 NET NET

ASSETS GIFTS & INTEREST & NET GAIN ON INVESTMENT ASSETS

JULY 1, 2014 TRANSFERS DIVIDENDS INVESTMENTS DISTRIBUTIONS FEES JUNE 30, 2015

ENDOWMENT FUNDS

Margaret Adams Scholarship 10,804$ -$ 310$ 95$ (370)$ (87)$ 10,752$

Charleen T. Adcock Scholarship 54,306 - 1,557 480 (1,714) (438) 54,191

Anderson Family Delta Sculpture Walk 104,884 - 3,007 926 (3,924) (844) 104,049

Anderson Family Scholarship 31,470 5,000 929 296 (1,006) (264) 36,425

Athletic Scholarship 361,298 - 10,357 3,193 (12,104) (2,908) 359,836

M. Seth Babcock Scholarship 16,325 - 468 144 (558) (131) 16,248

Mary Ann (McGregor) Badour Scholarship 39,097 - 1,121 345 (1,322) (315) 38,926

James & Joy Baker Scholarship 39,467 - 1,131 349 (1,291) (318) 39,338

Ormond Barstow/Ludo Frevel Award for Scholarly Achievement 30,397 - 871 270 (1,040) (245) 30,253

Baxandall Scholarship 173,703 15,000 5,129 1,800 (4,831) (1,462) 189,339

Bay City Central Class of '41 Scholarship 67,729 100 1,943 599 (2,271) (545) 67,555

Elzie & Muriel Beaver Scholarship 139,686 - 4,004 1,235 (4,758) (1,124) 139,043

Leonard & Esther Bergstein Scholarship 42,928 10,000 1,285 413 (889) (366) 53,371

Darrell R. Berry Scholarship 30,374 - 871 268 (1,021) (244) 30,248

Alfred J. Bladecki Scholarship 10,298 - 295 90 (352) (82) 10,249

Martin & Emma Block Scholarships 467,955 - 13,415 4,134 (15,831) (3,766) 465,907

Peter & Barbra Boyse Program (Restricted) 29,594 1,000 848 261 (971) (238) 30,494

Peter D. Boyse President's Scholar Program 1,957,445 - 56,113 17,293 (65,971) (15,752) 1,949,128

Business Division Scholarship 148,295 330 4,253 1,312 (5,068) (1,194) 147,928

Carlyon Farmhouse Maintenance 218,477 - 6,263 1,931 (7,455) (1,759) 217,457

Donald & Betty Carlyon Scholarship 130,890 15,801 3,852 1,255 (3,985) (1,091) 146,722

Donald & Betty Carlyon Endowed Teaching Chair 206,806 - 5,928 1,828 (7,048) (1,665) 205,849

DeeMona Chatman Scholarship 23,543 - 675 207 (779) (189) 23,457

William R. Collings Award for Outstanding Service & Academic Achievement 37,885 - 1,086 335 (1,282) (305) 37,719

Lynn Conway Athletic Scholarship 25,808 260 742 230 (809) (208) 26,023

Gilbert A. Currie Estate Scholarships 311,005 - 8,915 2,748 (10,640) (2,503) 309,525

Ilau & Phillip Dean Scholarship 39,216 - 1,124 347 (1,225) (316) 39,146

Delta Deltah's Scholarship 5,867 - 168 52 (201) (47) 5,839

Delta College Employee-Sponsored Scholarship 115,413 - 3,308 1,020 (3,945) (929) 114,867

Delta College Planetarium Fund 650,774 7,119 18,805 5,943 (21,273) (5,282) 656,086

Robert DeVinney Endowed Teaching Chair 141,236 75 4,049 1,249 (4,802) (1,137) 140,670

Dixon Family Scholarship 67,826 - 1,944 599 (2,288) (545) 67,536

Herbert Doan Scholarship 9,095 - 261 80 (311) (73) 9,052

B. Joe & Margery (Knepp) Dodson Scholarship 30,123 - 864 265 (929) (241) 30,082

Frances Dolinski Scholarship 61,245 5,000 1,794 595 (1,792) (509) 66,333

Henry Dolinski Scholarship 68,338 5,000 1,997 658 (2,023) (566) 73,404

Dr. Louis W. Doll & Patricia Drury Scholarship 41,265 100 1,184 367 (1,404) (333) 41,179

Tom Dostal Memorial Scholarship 26,213 150 752 232 (768) (211) 26,368

Dow Chemical Company Michigan Operations Award for Physical Science 25,702 - 737 227 (869) (207) 25,590

H H Dow Endowed Professor - 1,000,000 9,982 17,622 - (4,218) 1,023,386

Herbert H. & Barbara C. Dow Fund 43,334 - 1,242 384 (1,482) (349) 43,129

Jerry & Terry Drake Scholarship & Broadcasting Program Support 236,877 - 6,790 2,092 (8,030) (1,905) 235,824

Draper Family Scholarship 15,243 - 437 135 (521) (123) 15,171

Gene R. Duckworth Scholarship 30,627 100 879 271 (1,042) (247) 30,588

56

SUPPLEMENTAL SCHEDULE OF OTHER FINANCIAL INFORMATION

DETAILS OF ENDOWMENT FUND - Continued

YEAR ENDED JUNE 30, 2015 NET NET

ASSETS GIFTS & INTEREST & NET GAIN ON INVESTMENT ASSETS

JULY 1, 2014 TRANSFERS DIVIDENDS INVESTMENTS DISTRIBUTIONS FEES JUNE 30, 2015

ENDOWMENT FUNDS - Continued

Fred E. Dulmage Award for Engineering & Technology 22,584$ -$ 647$ 200$ (768)$ (182)$ 22,481$

Eldon Enger & Fred Ross Scholarship 24,065 25 690 214 (783) (194) 24,017

English Division Guest Lecturer 25,015 - 717 221 (830) (201) 24,922

James E. & Leanne Lutz Erickson Scholarship 21,981 786 634 197 (744) (178) 22,676

Faculty Executive Committee Award 5,116 - 147 45 (175) (41) 5,092

Fettig Family Scholarship 21,915 - 628 194 (643) (176) 21,918

Arthur J. & Bette L. Fisher Scholarship 289,299 - 8,293 2,556 (9,729) (2,328) 288,091

Peter & Suzanne Frantz Award for Art 26,185 - 751 230 (884) (210) 26,072

Dr. John & Joanne Fuller Scholarship 26,636 3,975 764 234 (901) (213) 30,495

David R. Gamez Scholarship 75,828 - 2,174 670 (2,398) (610) 75,664

Gerace Construction Scholarship 136,951 - 3,926 1,209 (4,634) (1,102) 136,350

Gerity Broadcasting Company Scholarship 108,257 - 3,103 957 (3,704) (872) 107,741

Gerstacker Faculty Recognition Award 33,964 - 974 299 (1,152) (272) 33,813

Global Education Program 38,087 - 1,092 336 (1,303) (307) 37,905

Robert M. Gohlke Scholarship 32,401 - 929 287 (1,108) (262) 32,247

Jean Goodnow Scholarship 27,463 641 796 252 (949) (224) 27,979

Gougeon Brothers, Inc. Award for Applied Industrial/Technical 25,016 - 717 220 (830) (201) 24,922

Patricia L. & Robert W. Grant Jr. Scholarship & Humanities Program - 253,848 5,403 6,936 - (1,608) 264,579

Great Lakes Bay Manufacturers' Association Scholarship 41,385 - 1,186 366 (1,368) (333) 41,236

Russell B. & Grace H. Green Scholarship 44,319 - 1,270 392 (1,500) (357) 44,124

Priscilla Bogi Guritza Memorial Scholarship 25,242 - 724 223 (864) (203) 25,122

Beki Gray Hadley Scholarship 44,252 - 1,269 390 (1,425) (356) 44,130

Sarah Hansen Scholarship 12,178 - 349 108 (409) (98) 12,128

Joan B. Harry Scholarship 26,723 - 766 236 (949) (215) 26,561

Harry Hawkins Scholarship 18,133 - 520 160 (619) (146) 18,048

Robert & Joyce Hetzler Family Award for Outstanding Service & Leadership 25,397 - 728 224 (857) (204) 25,288

Hilde & Walter Heyman Scholarship 20,287 - 582 178 (686) (162) 20,199

Ada E. Hobbs Scholarship 12,832 - 368 114 (439) (104) 12,771

Don Holzhei Memorial Scholarship 25,517 200 733 226 (834) (206) 25,636

Home Builders Association of Bay, Midland & Saginaw Counties 21,493 - 616 190 (729) (173) 21,397

Honors Student Scholarship 85,233 - 2,443 753 (2,916) (685) 84,828

James R. & Anita H. Jenkins Family Scholarship 124,353 - 3,565 1,099 (2,788) (1,002) 125,227

Phyllis E. Jones Memorial Scholarship 21,618 - 620 190 (732) (174) 21,522

S. Preston & Dr. Betty B. Jones International Scholarship 92,344 3,040 2,666 830 (2,976) (750) 95,154

Dan E. Karn Memorial Scholarship 4,355 - 125 39 (149) (36) 4,334

Kaufmann Family Scholarship 20,440 - 586 181 (692) (165) 20,350

Robert F. Keicher Memorial Scholarship 24,060 75 690 215 (809) (194) 24,037

Dale & Alma Keyser Scholarship 31,101 500 897 282 (1,022) (252) 31,506

Walter J. & Sophia M. Kilar Scholarship 24,733 - 709 219 (846) (199) 24,616

International Order of King's Daughters & Sons Scholarship 28,474 - 816 252 (974) (229) 28,339

Oscar W. Kloha Scholarship 41,222 - 1,182 364 (1,410) (332) 41,026

Robert I. & Marjorie H. Knepp Scholarship 225,536 - 6,465 1,992 (7,513) (1,814) 224,666

W.R. & Edith Knepp Scholarship 232,975 - 6,679 2,057 (7,970) (1,874) 231,867

W.R. Knepp, Jr. Scholarship 176,331 - 5,055 1,558 (6,032) (1,419) 175,493

57

SUPPLEMENTAL SCHEDULE OF OTHER FINANCIAL INFORMATION

DETAILS OF ENDOWMENT FUND - Continued

YEAR ENDED JUNE 30, 2015 NET NET

ASSETS GIFTS & INTEREST & NET GAIN ON INVESTMENT ASSETS

JULY 1, 2014 TRANSFERS DIVIDENDS INVESTMENTS DISTRIBUTIONS FEES JUNE 30, 2015

ENDOWMENT FUNDS - Continued

Daniel P. Kubiak Scholarship 21,169$ -$ 607$ 187$ (718)$ (170)$ 21,075$

Gary Laatsch Scholarship 40,324 50 1,156 358 (1,346) (325) 40,217

Jack LaBreck Scholarship 6,346 - 182 56 (217) (51) 6,316

Ilene M. Lane Nursing Scholarship 59,581 - 1,708 526 (1,848) (479) 59,488

Dr. Thomas H. Lane & Janis E. Landry-Lane Scholarship 85,023 - 2,437 751 (2,691) (684) 84,836

Edward & Kathryn (Dunn) Langenburg Award for Education 26,295 - 754 233 (881) (212) 26,189

Thomas & Rose Mary Laur Scholarship 85,739 500 2,461 758 (1,553) (691) 87,214

Leo & Evelyn Levy Scholarship 24,208 - 694 214 (799) (195) 24,122

Denise Lovay-Gravlin Memorial Scholarship 22,335 205 641 199 (763) (180) 22,437

Edward & Kathleen Lunt Scholarship 137,545 10,780 4,001 1,252 (4,629) (1,129) 147,820

Karen MacArthur Endowed Teaching Chair 129,619 - 3,716 1,144 (4,332) (1,043) 129,104

Thomas & Brenda Mahar Scholarship 26,386 - 756 234 (893) (213) 26,270

Margaret McAlear Scholarship 40,244 - 1,154 355 (1,361) (324) 40,068

James R. McIntyre Award for Health Sciences 25,912 - 743 229 (875) (208) 25,801

Aceie & Thelma Micho Scholarship 76,346 9,018 2,237 705 (1,803) (633) 85,870

Rhea Miller Scholarship 47,781 - 1,370 422 (1,617) (385) 47,571

Richard & Gloria Miller Scholarship 30,247 500 870 268 (896) (244) 30,745

Frances Goll Mills Award for Nursing 28,894 - 828 256 (956) (233) 28,789

Monitor Sugar Scholarship 20,440 - 586 181 (692) (165) 20,350

Paul Moore Social Science Division Award 22,116 220 636 198 (737) (178) 22,255

Morley Foundation Award for Business Management 26,545 - 761 235 (908) (214) 26,419

Virginia Morrison Scholarship 20,643 18,765 776 502 (607) (244) 39,835

Wendell & Ethel Mullison Scholarship 25,783 - 739 227 (882) (207) 25,660

W. Brock Neely Scholarship 39,560 2,000 1,154 385 (1,170) (327) 41,602

William H. "Buddy" Oates Scholarship 31,306 - 897 277 (1,068) (252) 31,160

Oscar P. & Louise H. Osthelder Scholarship 113,827 - 3,263 1,006 (3,490) (917) 113,689

Jesse J. Oswald Scholarship 31,358 503 904 285 (1,052) (254) 31,744

Marguerite Scull Parker Scholarship 26,173 - 750 232 (911) (211) 26,033

Otto C. Pressprich Fund 108,257 - 3,103 957 (3,704) (872) 107,741

Cecelia Randall Scholarship 22,377 - 641 198 (766) (180) 22,270

Alfonso Rasch-Isla Scholarship 24,279 - 696 214 (873) (195) 24,121

Newell Remington Scholarship & TLC Support 41,691 1,175 1,206 388 (1,358) (340) 42,762

Skip Renker Award for Creative Writing 20,770 - 595 184 (697) (168) 20,684

Renee Rookard Scholarship 75,043 - 2,151 663 (2,560) (604) 74,693

Harold & Norine Rupp Scholarship 20,077 - 576 178 (679) (162) 19,990

Saginaw County Child Development Centers Program Scholarship 17,131 - 491 152 (580) (139) 17,055

Cliff & Grace Saladine Scholarship 27,036 - 775 240 (925) (218) 26,908

Dawn Schmidt Award for Mathematics 26,835 75 770 238 (951) (216) 26,751

Peggy A. Scott Scholarship 33,853 2,000 990 335 (980) (281) 35,917

Ralph I. & Archie M. Selby Family Scholarship 21,541 - 617 190 (699) (173) 21,476

Gene F. Shrum & Dee Dee (Shrum) Wacksman Scholarship 19,276 200 557 175 (652) (156) 19,400

Van Dewitt & Ruth Simmons Scholarship 169,246 - 4,852 1,495 (5,790) (1,362) 168,441

John M. Smith & William Wolgast Family Softball Scholarship 21,661 - 621 191 (739) (174) 21,560

Paul Sowatsky Scholarship/Award 29,148 - 836 257 (997) (235) 29,009

58

SUPPLEMENTAL SCHEDULE OF OTHER FINANCIAL INFORMATION

DETAILS OF ENDOWMENT FUND - Continued

YEAR ENDED JUNE 30, 2015 NET NET

ASSETS GIFTS & INTEREST & NET GAIN ON INVESTMENT ASSETS

JULY 1, 2014 TRANSFERS DIVIDENDS INVESTMENTS DISTRIBUTIONS FEES JUNE 30, 2015

ENDOWMENT FUNDS - Continued

James Stark Scholarship 3,691$ -$ 106$ 33$ (126)$ (31)$ 3,673$

Eileen & Hugh Starks Scholarship 32,495 - 932 285 (1,096) (260) 32,356

James & Elizabeth Stoddard Scholarship - 20,000 201 350 - (83) 20,468

Sturm Family Broadcast Programming Fund 177,194 - 5,080 1,565 (6,062) (1,426) 176,351

SunGard Higher Education Endowed Teaching Chair 144,350 - 4,138 1,275 (4,922) (1,161) 143,680

SunGard Higher Education Possible Dream Program 85,873 - 2,462 759 (1,993) (692) 86,409

Julius & Irene Sutto Award for Life Sciences 25,327 - 726 224 (852) (204) 25,221

Paul & Margaret Thompson Scholarship 34,046 - 976 300 (1,151) (274) 33,897

Willie E. Thompson Scholarship 30,881 250 890 279 (951) (249) 31,100

Margaret Timm Award for English 26,870 - 770 238 (909) (217) 26,752

Wesley Timm Award for Social Science 31,949 - 916 282 (1,078) (257) 31,812

Jim & Janis Van Tiflin Award 24,590 - 705 217 (814) (197) 24,501

Ken & "Miss Mona" White Scholarship 61,559 7,700 1,841 676 (1,405) (527) 69,844

Lola Bishop Whitney Award for Foreign Language 115,028 - 3,297 1,017 (3,935) (926) 114,481

David & Carol Williams Scholarship - 20,000 108 69 - (43) 20,134

Alice & Jack Wirt Scholarship 211,762 - 6,070 1,871 (7,242) (1,704) 210,757

Teresa Plackowski-Witucki Scholarship 21,811 - 625 194 (719) (176) 21,735

Wolverine Bank Scholarship 38,074 - 1,091 336 (1,296) (306) 37,899

Robert R. Zimmerman "Dr. Bob" Scholarship 70,650 3,479 2,025 625 (1,839) (569) 74,371

Dr. Robert R. "Dr. Bob" Zimmerman Teaching Chair 33,121 22,087 1,102 535 (331) (324) 56,190

Alton, Sr., Alma & Alton, Jr. Zucker Scholarship 80,929 - 2,320 714 (2,769) (650) 80,544

Melvin & Hilda Zuehlke Scholarship and Special Needs Assistance Fund 140,922 - 4,040 1,245 (4,810) (1,134) 140,263

TOTAL ENDOWMENT FUNDS 12,051,247 1,447,632 362,358 133,089 (396,183) (103,397) 13,494,746

FUNDS FUNCTIONING AS ENDOWMENTS

Etcyl H. & Ruth Blair CGA 17,334 - 1,563 (664) - (182) 18,051

Peter & Barbra Boyse Program 258,665 - 7,415 2,286 (8,716) (2,082) 257,568

Coca-Cola Scholarship 65,965 - 1,891 583 (2,232) (531) 65,676

Gilbert A. Currie Fund 380,482 - 10,907 3,362 (13,262) (3,063) 378,426

Delta College Public Radio Fund 90,789 (17,164) 2,431 499 (3,617) (658) 72,280

Delta College Foundation Fund 995,047 (83,092) 27,695 7,327 (34,040) (7,657) 905,280

Delta College Foundation Student Scholarships 237,596 8,575 6,878 2,176 (6,375) (1,937) 246,913

Delta College Endowed Teaching Chair Challenge Grant Fund 131,012 4,076 3,756 1,156 (4,076) (1,054) 134,870

Delta College Public TV Fund 424,736 227,110 13,208 4,052 (6,700) (3,808) 658,598

Alden B. Dow Fund 51,592 - 1,479 456 (1,765) (415) 51,347

Laughner Award 18,137 - 520 160 (617) (146) 18,054

Possible Dream Program 1,818,197 90,000 52,121 16,064 (52,426) (14,632) 1,909,324

Sailing School Program 29,382 - 842 260 (998) (236) 29,250

UNUM Projects 354,574 - 10,164 3,132 (12,130) (2,853) 352,887

Macauley & Helen Whiting Fund 896,453 - 25,698 7,921 (30,334) (7,215) 892,523

TOTAL FUNDS FUNCTIONING AS ENDOWMENTS 5,769,961 229,505 166,568 48,770 (177,288) (46,469) 5,991,047

TOTAL 17,821,208$ 1,677,137$ 528,926$ 181,859$ (573,471)$ (149,866)$ 19,485,793$

59