PRELIMINARY OFFICIAL STATEMENT DATED AUGUST 4, 2020 NEW ISSUE RATING: S&P “AA” (See “Rating” herein) In the opinion of Bond Counsel, the interest on the Series 2020 Bonds is, under existing law and regulations, excludable from gross income of the recipients thereof for federal income tax purposes, assuming continuing compliance by the Authority with covenants to meet the requirements of the Internal Revenue Code of 1986, as amended, and is not an item of tax preference for purposes of the federal alternative minimum tax. Additionally, in the opinion of Bond Counsel, the interest on the Series 2020 Bonds is exempt from State of Oklahoma income taxation under present law. See “TAX EXEMPTION” herein. $3,150,000* THE JENKS PUBLIC WORKS AUTHORITY Utility System Revenue Bonds Series 2020 Dated: Date of Delivery Due: August 1 (as shown on inside cover) The Jenks Public Works Authority (the “Authority”) will issue the above described Utility System Revenue Bonds, Series 2020 (the "Series 2020 Bonds" or the “Bonds”) pursuant to a Bond Indenture dated as of August 1, 2020 (the “Indenture”) by and between the Authority and BancFirst, Oklahoma City, Oklahoma (the “Trustee” or “Bank”). The Authority is a public trust created and existing under the laws of the State of Oklahoma (the “State”), particularly but not exclusively Title 60, Oklahoma Statutes 2019 Supplement, Sections 176-180.4, inclusive, by which the Authority is designated as an agency of the State and regularly constituted authority of its beneficiary, the City of Jenks , Oklahoma (the “City”).

The Series 2020 Bonds are not obligations, legal or moral, or a debts, general or specific, of the City, nor of the State, or of any political subdivision thereof, including the Authority, nor personal obligations of the Trustees of the Authority or general obligations of the City, but are limited and special obligations payable solely out of revenues pledged for their payment as outlined in the paragraph entitled “SECURITY” herein and as described in the Indenture Neither the faith and credit nor the taxing power of the State or any political subdivision thereof, including the City, shall be pledged to the payment of the principal of or interest on the Series 2020 Bonds. THE AUTHORITY HAS NO TAXING POWER. Semi-annual interest is payable February 1 and August 1 beginning February 1, 2021. BancFirst, Oklahoma City, Oklahoma, is the Trustee Bank and the Registrar for the issue. The Series 2020 Bonds will be issued and registered in the name of Cede & Co., as nominee of the Depository Trust Company, New York, New York (“DTC”), to which all payments of principal and interest will be made. Purchasers will acquire beneficial interests in the Series 2020 Bonds, in principal amounts of $5,000 and integral multiples thereof, by book-entry only. Purchasers of the Series 2020 Bonds will not receive physical delivery of bond certificates. The Series 2020 Bonds will not be transferable or exchangeable, except for transfers to another nominee of DTC or otherwise as described herein. See “BOOK-ENTRY-ONLY-SYSTEM” herein. The Series 2020 Bonds maturing on August 1, 20__, and thereafter shall be subject to optional redemption prior to maturity as described herein. See “REDEMPTION PROVISIONS” herein. The Series 2020 Bonds are offered when, as, and if issued and received by the original purchaser, subject to prior sale, to withdrawal or modifications of the offer without any notice, and to the approval of legality of the Series 2020 Bonds by Johanning & Byrom, PLLC, Bond Counsel. Certain legal matters will be passed upon by the Floyd Law Firm, P.C., Norman, Oklahoma, for the Underwriter. It is expected that the Series 2020 Bonds in definitive form will be available for delivery to the Underwriter in Oklahoma City, Oklahoma, on or about August 28, 2020.

*Preliminary, subject to change.

This

Pre

limin

ary

Offi

cial

Sta

tem

ent a

nd th

e in

form

atio

n co

ntai

ned

here

in a

re s

ubje

ct to

com

plet

ion

or a

men

dmen

t with

out n

otic

e. T

hese

sec

uriti

es m

ay n

ot b

e so

ld, n

or m

ay o

ffers

to b

uy th

em

be a

ccep

ted,

prio

r to

the

time

the

Offi

cial

Sta

tem

ent i

s de

liver

ed in

fina

l for

m.

Und

er n

o ci

rcum

stan

ces

shal

l thi

s P

relim

inar

y O

ffici

al S

tate

men

t con

stitu

te a

n of

fer t

o se

ll or

a s

olic

itatio

n of

an

offe

r to

buy

, nor

sha

ll th

ere

be a

ny s

ale

of, t

hese

sec

uriti

es in

any

juris

dict

ion

in w

hich

suc

h of

fer,

solic

itatio

n or

sal

e w

ould

be

unla

wfu

l prio

r to

reg

istra

tion,

qua

lific

atio

n or

filin

g un

der

the

secu

ritie

s la

ws

of a

ny s

uch

juris

dict

ion.

THE JENKS PUBLIC WORKS AUTHORITY Utility System Revenue Bonds Series 2020

MATURITY SCHEDULE $3,150,000*

BASE DUE CUSIP(1) DATE AMOUNT RATE PRICE

8-1-2021 $ % % 8-1-2022 $ % % 8-1-2023 $ % % 8-1-2024 $ % % 8-1-2025 $ % % 8-1-2026 $ % % 8-1-2027 $ % % 8-1-2028 $ % % 8-1-2029 $ % % 8-1-2030 $ % %

(1) CUSIP numbers have been assigned to this issue by Standard & Poor’s CUSIP Service Bureau, a division of McGraw-Hill Companies, Inc., and are included solely for the convenience of the owners of the Series 2020 Bonds. Neither the Authority nor the Underwriter shall be responsible for the selection or correctness of the CUSIP numbers set forth above. The Series 2020 Bonds maturing on August 1, 20__, and thereafter shall be subject to optional redemption prior to maturity as described herein. See “REDEMPTION PROVISIONS”.

*Preliminary, subject to change.

THE JENKS PUBLIC WORKS AUTHORITY

TRUSTEES

Robert Lee Chairman Dawn Dyke Vice-Chairman Kaye Lynn Trustee Gary Isbell Trustee Craig Murray Trustee Donna Ogez Trustee Cory Box Trustee

MAYOR AND COUNCIL OF THE CITY OF JENKS

Robert Lee Mayor Dawn Dyke Vice-Mayor Kaye Lynn Councilmember Gary Isbell Councilmember Craig Murray Councilmember Donna Ogez Councilmember Cory Box Councilmember

PROFESSIONAL STAFF

Christopher Shrout City Manager Robert Sauceda Finance Director

BOND COUNSEL Johanning & Byrom, PLLC Oklahoma City, Oklahoma FINANCIAL ADVISOR The Baker Group LP Oklahoma City, Oklahoma

REGARDING USE OF THE OFFICIAL STATEMENT

The Series 2020 Bonds are offered only by means of this Official Statement. This Official

Statement does not constitute an offering of any security other than the Series 2020 Bonds specifically offered hereby. It does not constitute an offer to sell or a solicitation of an offer to buy the Series 2020 Bonds in any state or jurisdiction to any person to whom it is unlawful to make such offer, solicitation or sale, and no dealer, broker, salesman or other person has been authorized to make such unlawful offer, solicitation or sale. No dealer, broker, salesman or other person has been authorized to give any information or to make any representations other than those contained in this Official Statement in connection with the offering of the Series 2020 Bonds and, if given or made, such other information or representations must not be relied upon.

The Series 2020 Bonds will not be registered under the Securities Act of 1933, as amended, pursuant to an exemption under Section 3(a) thereof, and the Authority does not intend to list the Series 2020 Bonds on any stock or other securities exchange. The U.S. Securities and Exchange Commission has not passed upon the accuracy or adequacy of this Official Statement or passed upon or endorsed the merits of this offering of the Series 2020 Bonds. With respect to the various States in which the Series 2020 Bonds may be offered, no attorney general, state official, state agency or bureau, or other state or local governmental entity has passed upon the accuracy or adequacy of this Official Statement or passed on or endorsed the merits of this offering of Series 2020 Bonds.

All references made herein to the Series 2020 Bonds are qualified in their entirety by reference to the Indenture. All references made herein to the Indenture are qualified in their entirety by reference to such complete documents, original counterparts of which are on file in the offices of the Authority, 211 N. Elm Street, Jenks, OK 74037, and the corporate trust offices of BancFirst, 101 N. Broadway, Suite 900, Oklahoma City, OK 73102.

The information contained in this Official Statement, including the cover page and Exhibits hereto, has been obtained from the Authority and the City and other sources which are deemed to be reliable. No representation or warranty is made by the Underwriter, however, as to the accuracy or completeness of such information and nothing contained in this Official Statement is or shall be relied upon as a promise or representation by the Underwriter. This Official Statement is submitted in connection with the sale of securities as referred to herein and may not be reproduced or used in whole or in part for any other purpose. The delivery of this Official Statement does not at any time imply that information herein is correct as of any time subsequent to its date. This Official Statement is not to be construed as a contract with the purchasers of the Series 2020 Bonds.

For purposes of compliance with Rule 15c2-12(b)(1) of the U. S. Securities and Exchange Commission, this Official Statement has been deemed final by the Authority as of the date hereof.

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVER ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SERIES 2020 BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. STABILIZATION, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THE UNDERWRITER MAY OFFER AND SELL THE SERIES 2020 BONDS TO CERTAIN DEALERS AND CERTAIN DEALER BANKS AND BANKS ACTING AS AGENTS AT PRICES LOWER THAN THE PUBLIC OFFERING PRICES STATED ON THE COVER PAGE HEREOF AND SAID PUBLIC OFFERING PRICES MAY BE CHANGED FROM TIME TO TIME BY THE UNDERWRITER.

THE UNDERWRITER HAS PROVIDED THE FOLLOWING SENTENCE FOR

INCLUSION IN THIS OFFICIAL STATEMENT. THE UNDERWRITER HAS REVIEWED THE INFORMATION IN THIS OFFICIAL STATEMENT IN ACCORDANCE WITH, AND AS PART OF, THEIR RESPONSIBILITIES TO INVESTORS UNDER THE FEDERAL SECURITIES LAWS AS APPLIED TO THE FACTS AND CIRCUMSTANCES OF THIS TRANSACTION, BUT THE UNDERWRITER DOES NOT GUARANTEE THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION.

THIS OFFICIAL STATEMENT CONTAINS “FORWARD-LOOKING” STATEMENTS WITHIN THE MEANING OF SECTION 21E OF THE U.S. SECURITIES AND EXCHANGE ACT OF 1934, AS AMENDED. SUCH STATEMENTS MAY INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE THE ACTUAL RESULTS, PERFORMANCE AND ACHIEVEMENTS TO BE DIFFERENT FROM THE FUTURE RESULTS, PERFORMANCE AND ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. INVESTORS ARE CAUTIONED THAT THE ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE SET FORTH IN THE FORWARD LOOKING STATEMENTS.

All information contained in this Official Statement, including the schedule and exhibits attached hereto, is subject, in all respects, to the complete body of information contained in the original sources thereof and no guaranty, warranty, or other representation is made concerning the accuracy or completeness of the information herein. In particular, no opinion or representation is rendered as to whether any projection will approximate actual results, and all opinions, estimates and assumptions, whether or not expressly identified as such, should not be considered statements of fact.

None of the Authority, the Underwriter, or the Financial Advisor makes any representation or warranty with respect to the information contained in this Official Statement regarding DTC (defined herein) or its Book-Entry-Only System, as such information has been provided by DTC.

For additional information or copies of this prospectus, contact The Jenks Public Works

Authority, (918) 299-5883, 211 North Elm, Jenks, Oklahoma 74037-2007 or The Baker Group LP, Financial Advisor, 1601 Northwest Expressway, 20th Floor, Oklahoma City, Oklahoma 73118, (405) 415-7215.

OFFICIAL STATEMENT Table of Contents

Page The Authority ........... ................................................................................................................... 1 Trustees .................... ................................................................................................................... 1 Purpose of Issue ....... ................................................................................................................... 2 Project ...................... .......................................................................................................................2 Risk Factors and Certain Considerations for Bondholders ..............................................................2 Tax Exemption ......... ................................................................................................................... 2 Required Rebate to the United States .......................................................................................... 3 Redemption Provisions ................................................................................................................ 3 Book Entry Only System ............................................................................................................. 5 Source and Application of Proceeds ............................................................................................ 7 Security .................... ................................................................................................................... 7 Other Outstanding Authority Indebtedness ................................................................................. 8 Rate Covenant .......... ..................................................................................................................... 8 Comparative Revenue and Expenditures ..................................................................................... 10 The Depository......... .....................................................................................................................11 The Trustee Bank ..... .....................................................................................................................11 The Registrar ............ .....................................................................................................................11 Flow of Funds .......... .....................................................................................................................11 Additional Bonds ..... .....................................................................................................................13 Bond Covenants ....... .....................................................................................................................13 Defeasance ............... .....................................................................................................................16 Defaults and Remedies ..................................................................................................................16 Legal Opinions ......... .....................................................................................................................16 No Litigation ............ .....................................................................................................................16 Rating ....................... .....................................................................................................................17 Underwriting ............ .....................................................................................................................17 Financial Advisor ..... .....................................................................................................................17 Continuing Disclosure ...................................................................................................................18 Deemed Final ........... .....................................................................................................................19 Miscellaneous .......... .....................................................................................................................19 Approval of Official Statement ......................................................................................................19 Exhibits

A Amortization Schedule B Economic Indices C Utility Rates D City of Jenks, Oklahoma Annual Financial Report FYE June 30, 2019 E Lease, as supplemented F Form of Opinion of Bond Counsel G Continuing Disclosure Agreement

1

THE AUTHORITY

The Jenks Public Works Authority (the "Authority"), a public trust, is a statutory instrumentality created for the benefit of the City of Jenks, Oklahoma (the "City"), and an agency of the State of Oklahoma (the “State”). The Authority was created under provisions of the Oklahoma Statutes by a Declaration of Trust dated September 10, 1969, as supplemented, (the “Declaration of Trust”) to furnish the City with services and facilities for the conservation and implementation of the public welfare and for the protection and promotion of public health and for other purposes proper for the City itself to furnish. The City is the sole beneficiary of the Authority and receives all net income not needed for Authority purposes. The City has leased pursuant to the Lease Agreement dated February 2, 1970, by and between the City as lessor, and the Authority, as lessee (the “Lease”), to the Authority the entire water and sanitary sewer systems of the City (the "Systems"). The Authority is offering as security for the Series 2020 Bonds a pledge of the Net Revenues, as defined herein, of its leasehold estate in the Systems (the "Trust Estate") and is empowered by the Declaration of Trust to acquire, construct, maintain and operate the Systems for the City, and borrow money by mortgage, pledge, or other encumbrance of the Trust Estate or its revenues including the issuance of bonds or notes. All properties held by the Authority for the benefit of the City will become the property of the City when the Authority's debts are extinguished. The Authority has the same duration as the City, or until its purposes shall have been fulfilled, or until it shall have been terminated by mutual agreement but in no event shall the Authority be terminated so long as any indebtedness of the Authority remains outstanding. The validity of Trusts of the nature of the Authority has been approved by the Supreme Court of the State. The Authority has no taxing power. TRUSTEES

The Trustees of the Authority are the same persons who are currently the members of the City Council of the City (the “City Council”), and as such, they continue to hold office until their successors are elected to the City Council, and qualify for office. The Mayor of the City is the Chairman of the Trustees of the Authority; and, the City Clerk is the Secretary of the Trustees. Present Trustees and employees of the Authority are:

Robert Lee Chairman Dawn Dyke Vice-Chairman Kaye Lynn Trustee Gary Isbell Trustee Craig Murray Trustee Donna Ogez Trustee Cory Box Trustee Christopher Shrout City Manager Robert Sauceda Finance Director

2

PURPOSE OF ISSUE

The Series 2020 Bonds will be issued for purposes in providing (i) an automated meter reading system for the Authority’s water system (see “PROJECT” herein); and (ii) payment for all costs of issuance on the Series 2020 Bonds.

PROJECT

The Series 2020 Bonds will provide funds for an automated meter reading system.

RISK FACTORS AND CERTAIN CONSIDERATIONS FOR BONDHOLDERS

The following is a summary, which does not purport to be comprehensive or definitive, of certain risk factors and considerations relating to the purchase of the Bonds. A full review, however, should be made of the entire Official Statement in connection with any decision to purchase Bonds. General Risks

THE PURCHASE OF THE SERIES 2020 BONDS IS SUBJECT TO CERTAIN RISKS. EACH PROSPECTIVE INVESTOR IN THE SERIES 2020 BONDS IS ENCOURAGED TO READ THIS OFFICIAL STATEMENT IN ITS ENTIRETY, INCLUDING THE APPENDIX HERETO AND DOCUMENTS REFERENCED HEREIN THAT CAN BE PROVIDED UPON REQUEST. PARTICULAR ATTENTION SHOULD BE GIVEN TO THE FACTORS DESCRIBED BELOW WHICH, AMONG OTHERS, COULD AFFECT THE PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THE SERIES 2020 BONDS, AND COULD ALSO AFFECT THE MARKET PRICE OF THE SERIES 2020 BONDS TO AN EXTENT THAT CANNOT BE DETERMINED. THE FOLLOWING LIST OF RISK FACTORS IS NOT INTENDED TO PROVIDE AN EXHAUSTIVE LIST OF THE GENERAL OR SPECIFIC RISKS RELATING TO THE PURCHASE OF THE SERIES 2020 BONDS. ADDITIONAL RISK FACTORS RELATING TO AN INVESTMENT IN THE SERIES 2020 BONDS ARE DESCRIBED THROUGHOUT THIS OFFICIAL STATEMENT, INCLUDING THE APPENDICES HERETO, WHETHER OR NOT SPECIFICALLY DESIGNATED AS RISK FACTORS.

Limited Security

The Bonds are special, limited obligations of the Authority payable from the Net Revenues of

the Systems as described herein.

3

Factors Affecting Ability to Pay Debt - Not General Obligations of the Authority or the City

The ability of the Authority to pay debt service on the Bonds as due is subject to various factors that are beyond the control of the Authority, including the general economic conditions of the service area. The Bonds are not general obligations of the Authority or the City; therefore, the ability of the Authority to pay debt service on the Bonds is entirely dependent upon the collection of sufficient revenues solely from the Net Revenues, as described herein, to allow the Authority to meet the debt service requirements. The Authority is under no obligation to use revenues or funds from any other source to pay the debt service on the Bonds. THE AUTHORITY HAS NO TAXING POWER. Secondary Market Not Established Prices of municipal bonds traded by the Underwriter in the secondary market, if any are subject to adjustment upward and downward in response to changes in the credit markets and changes in the performance of the issuers of such bonds. From time to time, it may be necessary for the Underwriter to suspend indefinitely secondary market trading in selected issues of municipal bonds as a result of the financial condition or market position of the Underwriter, prevailing market conditions, lack of adequate current financial information about the Issuer, whether or not the subject bonds are in default as to principal and interest payments, and other factors which, in the opinion of the Underwriter, may give rise to uncertainty concerning prudent secondary market practices. Municipal bonds are generally viewed as long-term investments, subject to material unforeseen changes in the investor’s circumstances and may require commitment of the investors’ funds for an indefinite period of time, perhaps until maturity. Enforcement of Indenture Restricted

Enforcement of the remedies under the Indenture may be limited or restricted by laws relating to bankruptcy and rights of creditors and by application of general principles of equity applicable to the availability of specific performance, and may be substantially delayed in the event of litigation or statutory remedy procedures.

Infectious Disease Outlook (COVID-19)

The World Health Organization has declared a pandemic following the outbreak of COVID-19,

a respiratory disease caused by a new strain of coronavirus (the “Pandemic”), which is currently affecting the national capital markets and which may negatively impact the State’s housing market and its overall economy. The treat from the Pandemic is being addressed on a national, federal, state and local levels in various forms, including executive orders and legislative actions.

On January 31, 2020, the Secretary of the United States Health and Human Services

Department declared a public health emergency for the United States in connection with COVID-19. On March 13, 2020, the President of the United States declared the Pandemic a national emergency and the Oklahoma Governor (the “Governor”) subsequently declared COVID-19 an imminent threat of disaster for all counties in Oklahoma (collectively, the “disaster declarations”). On April 5, 2020,

4

in response to a request from the Governor, the President issued a Major Disaster Declaration for the State of Oklahoma.

Pursuant to Oklahoma’s Catastrophic Health Emergency Act, the Governor has broad authority to respond to disasters. including suspending any regulatory statute prescribing the procedures for conducting state business or any order or rule of a state agency that would in any way prevent, hinder, or delay necessary action in coping with this disaster and issuing executive orders that have the force and effect of law. The Governor has issued a number of executive orders relating to COVID-19 preparedness and mitigation. Many of the federal, state and local actions and policies under the aforementioned disaster declarations are focused on limiting instances where the public can congregate or interact with each other, which affects economic growth within Oklahoma

Since the disaster declarations were made, the Pandemic has negatively affected travel,

commerce, and financial markets globally, and is widely expected to continue negatively affecting economic growth and financial markets worldwide and within Oklahoma. Stock values and crude oil prices in the U.S. and globally, have seen significant declines attributed to COVID-19 concerns. Oklahoma may be particularly at risk from any global slowdown, given the risk of contraction in the oil and gas industry and spillover effects into other industries, including manufacturing.

The Bonds are secured by the Net Revenues as defined herein, and the continued outbreak of COVID-19 could adversely impact economic conditions within the City which could result in reduced demand for services provided by the Systems and reduced customer ability to pay for those services as well as lower sales tax collections by the City.

The City and the Authority continue to monitor the spread of COVID-19 and are working with local, state, and national agencies to address the potential impact of COVID-19 upon the City. While the potential impact of COVID-19 on the City cannot be quantified at this time, the continued outbreak of COVID-19 could have an adverse effect on the City’s financial condition. At present, neither the Authority nor the City has experienced any materially adverse financial impacts from the Pandemic, however, there could be reductions in property tax receipts, sales tax receipts, and other collections, including the corresponding disbursements thereof, as well as other disruptions for a period of time. Non-Appropriation Risk

Since the Oklahoma Constitution allows only for a pledge of the funds derived from the collection of a sales tax on a year to year basis, the sales tax is to be committed to the Authority on a year to year basis, subject to the annual appropriation of such monies by the City. If the City should decide not to appropriate such monies or should the City take action to eliminate the pledge or should the voters rescind the right of the City to levy and collect the sales tax, the Authority may be unable to pay the debt service requirements of the Series 2020 Bonds. The right of the City to levy and collect sales tax is provided in the statutes of the State of Oklahoma. The legislature has the ability to rescind the right of the City to levy and collect sales tax. Additionally, pursuant to the laws of the State of Oklahoma the governing body of the City and the citizens of the City have the ability to repeal the ordinance providing for the levy of sales tax. If the Authority should not receive any sales tax or if

5

such collections should decline due to economic conditions, it could inhibit the ability of the Authority to pay the debt service requirements of the Series 2020 Bonds.

TAX EXEMPTION

In the opinion of Bond Counsel, under existing statutes, regulations, rulings, and court

decisions, interest on the Series 2020 Bonds is excludable from the gross income of the owners of the Series 2020 Bonds for federal income tax purposes. Bond Counsel is further of the opinion that interest on the Bonds is not an item of tax preference for purposes of the federal alternative minimum tax. In expressing such opinions, Bond Counsel will rely on and assume compliance by the Authority and the City with the terms of the Federal Tax and Arbitrage Certificate and continuing requirements with certain provisions of the Internal Revenue Code of 1986 (the “Code”) after the issuance of the Series 2020 Bonds. The Federal Tax and Arbitrage and Use of Proceeds Certificate contains certain covenants with respect to the use and investment of the proceeds of the Series 2020 Bonds and the use of the Trust Estate, as defined herein. Failure by the Authority or City to comply with these covenants and all requirements of the Code may cause the interest on the Series 2020 Bonds to become includable in federal gross income retroactively to the date of issuance of the Series 2020 Bonds.

The laws and regulations upon which Bond Counsel has based its opinion are subject to change by the Congress and the Department of the Treasury and to subsequent judicial and administrative interpretation. There can be no assurance that such laws or regulations or the interpretation thereof will not be changed in a manner which would adversely affect the tax treatment of ownership of the Series 2020 Bonds.

Certain foreign corporations doing business in the United States may be subject to a “branch profits tax” on their effectively-connected earnings and profits including tax-exempt interest such as interest on the Series 2020 Bonds. Furthermore, in the case of a subchapter S corporation, interest on the Series 2020 Bonds is treated as passive investment income which is subject to the tax imposed by Section 1375 of the Code.

Prospective purchasers of the Series 2020 Bonds should be aware that the ownership of tax-exempt obligations may result in collateral federal income tax consequences to financial institutions, property and casualty insurance companies, individual recipients of Social Security or Railroad Retirement benefits and taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry tax-exempt obligations. Prospective purchasers falling within any of these categories should consult their own tax advisers as to the applicability of these consequences. Backup Withholding

As a result of the enactment of the Tax Increase Prevention and Reconciliation Act of 2005, interest on tax-exempt obligations such as the Series 2020 Bonds is subject to information reporting in a manner similar to interest paid on taxable obligations. Backup withholding may be imposed on payments made after March 31, 2007 to any bondholder who fails to provide certain required

6

information including an accurate taxpayer identification number to any person required to collect such information pursuant to Section 6049 of the Code. The reporting requirement does not in and of itself affect or alter the excludability of interest on the Series 2020 Bonds from gross income for federal income tax purposes or any other federal tax consequence of purchasing, holding or selling tax-exempt obligations. State Tax Considerations

Interest on the Series 2020 Bonds is exempt from State of Oklahoma income taxation under present law. Depending upon the state of residence of the registered owners of the Series 2020 Bonds, interest income on the Series 2020 Bonds may be subject to state income tax liability in their respective state of residence. Each registered owner of the Series 2020 Bonds is encouraged to consult with a tax advisor in order to determine the applicability of state income taxation to this investment. Original Issue Discount

The resulting discount on those Series 2020 Bonds which are sold at an initial offering price to the public (excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters or wholesalers) which is less than the principal amount of those particular Series 2020 Bonds constitute Original Issue Discount, which is excludable from the gross income for federal income tax purposes. Generally, such Original Issue Discount accretes actuarially on a constant interest rate basis over the term of the respective Series 2020 Bonds and the basis of such Series 2020 Bonds acquired at such initial offering price by an initial purchaser of the particular Series 2020 Bonds will be increased by the amount of such accreted interest. Original Issue Premium

Certain maturities of the Series 2020 Bonds may be initially offered to the public at prices greater than the amounts payable thereon at maturity. As a result of the tax cost reduction requirements of the Code relating to amortization of bond premium, under certain circumstances an initial owner of Premium Bonds may realize a taxable gain upon disposition of such Premium Bonds even though they are sold or redeemed for an amount equal to such owner’s original cost of acquiring such Premium Bonds. Owners of Premium Bonds are advised that they should consult with their own tax advisors with respect to the tax consequences of owning such Premium Bonds. Compliance with Tax Law Requirements

In order to maintain the exclusion from federal gross income of interest on the Series 2020 Bonds and for no other purpose, the Authority and the City covenant in the Indenture and in the Federal Tax and Arbitrage and Use of Proceeds Certificate to comply with the provisions of the Code. Until and unless, and except to the extent in the opinion of Bond Counsel, the following are not necessary to maintain the exclusion from federal gross income of interest on the Series 2020 Bonds, the Authority and the City make certain covenants, representations and warranties with respect to the Series 2020 Bonds. The Authority and the City covenant to submit in a timely manner all reports,

7

accountings and information to the Internal Revenue Service, take whatever action is necessary within its power to assure the continued tax exemption on the Series 2020 Bonds, and take whatever action is necessary within its power to comply with the applicable laws and regulations in order to maintain the exclusion from federal gross income of interest on the Series 2020 Bonds.

Tax legislation, administrative actions taken by tax authorities, and court decisions, whether at the federal or state level, may adversely affect the tax-exempt status of interest on the Series 2020 Bonds under federal or state law and could affect the market price or marketability of the Series 2020 Bonds.

Prospective purchasers of the Series 2020 Bonds should consult their own tax advisors regarding the foregoing matters.

Changes in Federal and State Tax Law

From time to time, there are legislative proposals in the Congress and in the states that, if enacted, could alter or amend the federal and state tax matters referred to above or adversely affect the market value of the Series 2020 Bonds. It cannot be predicted whether or in what form any such proposal might be enacted or whether if enacted it would apply to bonds issued prior to enactment. In addition, regulatory actions are from time to time announced or proposed and litigation is threatened or commenced which, if implemented or concluded in a particular manner, could adversely affect the market value of the Series 2020 Bonds. It cannot be predicted whether any such regulatory action will be implemented, how any particular litigation or judicial action will be resolved, or whether the Series 2020 Bonds or the market value thereof would be impacted thereby. Purchasers of the Series 2020 Bonds should consult their tax advisors regarding any pending or proposed legislation, regulatory initiatives or litigation. The opinions expressed by Bond Counsel are based upon existing legislation and regulations as interpreted by relevant judicial and regulatory authorities as of the date of issuance and delivery of the Series 2020 Bonds, and Bond Counsel has expressed no opinion as of any date subsequent thereto or with respect to any pending legislation, regulatory initiatives or litigation.

REQUIRED REBATE TO THE UNITED STATES

The Authority in the Indenture has covenanted to comply and the Bank is empowered to take any and all actions necessary to comply with all of the provisions of the Code, relating to the exemption from federal income taxes of the interest paid upon the bonds authorized by the Indenture, including the Series 2020 Bonds, to the end that interest thereon shall remain exempt from federal income taxation.

The Code, as amended, provides that bonds which are part of an issue, including the Series 2020 Bonds, will be treated as arbitrage bonds if certain hereinafter described requirements are not met with respect to such issue.

8

Under the Code, an issuer, including the Authority, is required to make certain payments or rebates to the United States in an amount equal to the sum of the excess of the amount of money earned on all non-purpose investments, over the amount of money which would have been earned if such non-purpose investments were invested at a rate of interest equal to the yield on the issue, including the Series 2020 Bonds, plus any income derived from the aforesaid excess itself. The aforesaid payments or rebates are to be paid in installments which are required to be made at least once every five years and each such installment is required to be in an amount which ensures that 90 percent of the excess amount (referred to above) with respect to the issue, at the time payment of such installment is required, will have been paid to the United States. The final installment is required to be paid no later than 60 days after the final maturity of the Series 2020 Bonds, and shall be in an amount sufficient to pay the remaining balance of the excess amount (referred to above) with respect to such issue.

The Authority will abide by its covenants to comply with the Code, including the covenant to timely pay or rebate any and all excess earnings in the manner provided in the Code.

REDEMPTION PROVISIONS

The Series 2020 Bonds are subject to redemption prior to maturity only as described in this section of the Official Statement.

A. Optional Redemption - The Series 2020 Bonds maturing on August 1, 20__, and thereafter shall be subject to redemption prior to maturity at the option of the Authority, on at least thirty (30) days’ notice (to be provided in the manner hereafter stated), in whole or in part, in inverse order of maturity and by lot within a maturity on any date, on and after August 1, 20__, at the redemption prices of par and accrued interest.

B. Mandatory Sinking Fund Redemption - The Series 2020 Bonds are subject to

mandatory sinking fund redemption and payment prior to maturity on August 1, 20__, and on each August 1, thereafter through August 1, 20__, at a redemption price equal to the principal amount thereof plus accrued interest thereon to the redemption date, as follows:

Mandatory

Redemption Dates Principal

*Final Maturity

9

C. Special Redemption - The Series 2020 Bonds are subject to special redemption at the

option of the Authority, in whole or in part, at any time, if such redemption is made from: (a) the proceeds of the sale of all or part of the Project; or (b) payments received from the Authority pursuant to an Event of Default as defined in the Indenture.

The Series 2020 Bonds are also subject to special redemption, at the option of the

Authority, in whole at any time, at the principal amounts thereof and accrued interest to the date fixed for redemption, if: (i) as a result of any change in the Constitution of the United States of America or of the State or legislative or administrative action whether State or Federal, or by final judgment in a court of competent jurisdiction after the contest thereof by the City or the Authority in good faith, wherein the Indenture or the Lease become void, unenforceable, or impossible to perform in accordance with the intent and purpose of the parties as expressed therein; or (ii) the interest on the Series 2020 Bonds shall become includable in the gross income of the holders thereof for federal income tax purposes.

In the event that any special redemption is made, such redemption shall be made at the

principal price equal to 100% of the aggregate principal amount of the Series 2020 Bonds redeemed plus the interest accrued thereon to the redemption date.

D. Extraordinary Redemption from Insurance and Condemnation Proceeds - The

Series 2020 Bonds are subject to redemption in whole at any time or in part from any net insurance or condemnation proceeds deposited with the Bank for the purpose of redemption pursuant to the Lease. Such redemption shall occur on any business day selected by the Bank for which adequate notice pursuant to the Indenture may be given, at a redemption price equal to 100% of the aggregate principal amount of the Series 2020 Bonds to be redeemed plus accrued interest to the redemption date.

E. Notice and Effect of Redemption - Notice of any call for redemption will be given

by the Trustee Bank, identifying the Series 2020 Bonds to be redeemed, not less than thirty (30) days prior to the redemption date by notice sent by first class mail to the holder or holders of the bond or bonds to be redeemed, directed to the address shown on the registration books. No further interest will accrue on the principal of any Series 2020 Bonds called for redemption from and after the date fixed for redemption if payment of the redemption price thereof has been duly provided for.

BOOK-ENTRY ONLY SYSTEM

The Depository Trust Company (“DTC”), New York, NY, will act as securities depository for the Series 2020 Bonds (also referred herein as the “Securities”). The Securities will be issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee). One

10

fully-registered Security certificate will be issued for the Securities in the aggregate principal amount of such issue and will be deposited with DTC at the office of the Trustee on behalf of DTC utilizing the DTC FAST System of registration.

DTC is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds securities that its participants (“Participants”) deposit with DTC. DTC also facilitates the settlement among Participants of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in Participants’ accounts, thereby eliminating the need for physical movement of securities certificates. Direct Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is owned by a number of its Direct Participants and by the New York Stock Exchange, Inc., the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as securities brokers and dealers, banks, and trust companies that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). The Rules applicable to DTC and its Participants are on file with Securities and Exchange Commission.

Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC’s records. The ownership interest of each actual purchaser of each Security (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase, but Beneficial Owners are expected to receive written confirmations providing details of the transactions, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book-entry system for the Securities are discontinued.

To facilitate subsequent transfers, all Securities deposited by Participants with DTC (or the Trustee on behalf of DTC utilizing the DTC FAST System of registration) are registered in the name of DTC’s partnership nominee, Cede & Co. The deposit of Securities with DTC and their registration in the name of Cede & Co. effect no change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC’s records reflect only the identity of the Direct Participants to whose account such Securities are credited, which may or may not be the Beneficial Owners. The Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial

11

Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.

Redemption notices shall be sent to Cede & Co. If less than all of the Securities within the issue are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

Neither DTC nor Cede & Co. will consent or vote with respect to Securities. Under its usual procedures, DTC mails an Omnibus Proxy to the Authority as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose account the Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Principal and interest payments on the Securities will be made by the Bank to DTC. DTC’s practice is to credit Direct Participants’ accounts on payable date in accordance with their respective holdings shown on DTC’s records unless DTC has reason to believe that it will not receive payment on payable date. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as in the case with securities held for the accounts of customers in bearer form or registered in “street name”, and will be the responsibility of such Participants and not of DTC, Agent, or the Authority, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal and interest to DTC is the responsibility of the Authority or Agent, disbursement of such payments to Direct Participant shall be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners shall be the responsibility of Direct and Indirect Participants.

A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered,

through its Participant, to Agent, and shall effect delivery of such Securities by causing the Direct Participant to transfer the Participant’s interest in the Securities, on DTC’s records, to Agent. The requirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC’s records and followed by a book-entry credit of tendered Securities to Agent’s DTC account.

DTC may discontinue providing its services as securities depository with respect to the Securities at any time by giving reasonable notice to the Authority or Agent. Under such circumstances, in the event that a successor securities depository is not obtained, Security certificates are required to be printed and delivered.

The Authority may decide to discontinue use of the system of book-entry transfer through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered. In reading this Official Statement is should be understood that while the Securities are in the Book-Entry-Only System, references in other sections of this Official Statement to registered owners should be read to include the person for which the Participant acquires an interest in the

12

Securities, but (i) all rights of ownership must be exercised through DTC and the Book-Entry-Only System, and (ii) except as described above, notices that are to be given to registered owners under the Indenture will be given only to DTC. The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that the Authority believes to be reliable, but the Authority takes no responsibility for the accuracy thereof.

SOURCE AND APPLICATION OF PROCEEDS Revenue Bond Issue $ Project Fund $ Reoffering Premium Underwriter's Discount

Costs of Issuance (1)

Total $ Total $ (1) Cost of Issuance includes legal fees, trustee fees, rating agency fee, financial advisory fee, printing costs and other miscellaneous costs of issuance for the Series 2020 Bonds. SECURITY

The Series 2020 Bonds are secured by a pledge of the Net Revenues as defined herein which shall be secured on an equal and parity basis with the Authority’s Utility System Revenue Bonds 2019, dated December 1, 2019, in the original principal amount of $14,660,000, all of which remain outstanding (the “Series 2019 Bonds”)

The Series 2020 Bonds are secured by a first lien on the Net Revenues of the Trust Estate (hereinafter defined) which, together with the three cent (3¢) sales tax appropriated to the Authority by resolution of the City Council on October 7, 1985, (the “Sales Tax Revenues”) and paid to the Authority, are never to be less than 1.25 times average annual debt service charges of the Series 2020 Bonds and other debts which may hereafter be incurred and secured equally with them.

Net Revenues of the Trust Estate are defined as all revenues derived from it, together with the Sales Tax Revenues actually paid over to the Authority, less only all costs of its operation and maintenance (the “Net Revenues”). Average Annual Debt Service charges are defined as all charges for payment of principal of and interest on Series 2020 Bonds, due and payable from their date of issue, up to and including payment of the final maturity of that issue, divided by the number of years elapsed during that period.

Since the Oklahoma Constitution allows only for a pledge of the funds derived from the

collection of a sales tax on a year to year basis, the Sales Tax Revenues are to be committed to the Authority on a year to year basis, subject to the annual appropriation of such monies by the City. If the City should decide not to appropriate such monies or should the City take action to eliminate the

13

pledge or should the voters rescind the right of the City to levy and collect any Sales Tax Revenues, and if the Authority shall be unable in the future to raise rates, fees and charges for services of the Systems or cause such to be raised, the Authority may be unable to pay the debt service requirements of the Series 2020 Bonds. The right of the City to levy and collect any Sales Tax Revenues is provided in the statutes of the State of Oklahoma. The legislature has the ability to rescind the right of the City to levy and collect any Sales Tax Revenues. Additionally, pursuant to the laws of the State of Oklahoma the governing body of the City and the citizens of the City have the ability to repeal the ordinance providing for the levy of sales tax. If the Authority should not receive any Sales Tax Revenues or if such collections should decline due to economic conditions, it could inhibit the ability of the Authority to pay the debt service requirements of the Series 2020 Bonds.

The amount of Sales Tax Revenues depends upon the sale of covered goods and services within the jurisdiction of the City and is therefore dependent upon the general economy of the City. The Oklahoma Legislature has the ability to modify the definition of covered goods and services. For example, the Oklahoma Legislature has considered removing food from the definition of covered goods, but no action was taken. Such reductions would have a negative impact on debt service coverage. There can be no assurance that the amount of Sales Tax Revenues levied and collected in any period will be sufficient to fund debt service on the Series 2020 Bonds.

OTHER OUTSTANDING AUTHORITY INDEBTEDNESS

The Authority has previously issued its Series 2019 Bonds, of which all principal amounts are currently outstanding.

Additionally, the Authority has entered into a Replenishment Agreement, dated April 1, 2014,

(the “Replenishment Agreement”) with the Bank whereby the Authority has agreed to immediately replenish the reserve fund created pursuant to a bond indenture securing The Jenks Aquarium Authority Refunding Revenue Bonds Series 2014 (the “Aquarium Bonds”). The Aquarium Bonds were issued in the principal amount of $17,115,000, are currently outstanding in the principal amount of $13,045,000 and are secured by a first mortgage upon certain aquarium facilities constructed with the proceeds of the Aquarium Bonds and the gross revenue derived from said aquarium facilities. In the event that gross revenues derived by the operation of the aquarium facilities are insufficient to pay the debt service on the Aquarium Bonds at any time, such insufficiency shall be cured by withdrawing funds in the amount of the insufficiency from the reserve fund created pursuant to the indenture securing the Aquarium Bonds. Pursuant to the Replenishment Agreement, the Authority will deposit funds in the amount of any insufficiency into the aforesaid reserve fund. THE OBLIGATION OF THE AUTHORITY TO MAKE PAYMENTS UNDER THE REPLENISHMENT AGREEMENT IS SUBORDINATE TO THE LIEN SECURING BOTH THE SERIES 2019 BONDS AND THE SERIES 2020 BONDS. NO PROCEEDS OF THE SERIES 2020 BONDS SHALL BE USED TO MAKE PAYMENTS UNDER THE REPLENISHMENT AGREEMENT.

14

RATE COVENANT

The Authority has covenanted to adopt a schedule of rates and charges for water and sanitary sewer services sufficient, together with appropriated sales tax proceeds actually paid over to the Authority, to provide Net Revenues equal to one and one-quarter (1.25) times average annual debt service charges for Series 2020 Bonds and all bonds equally secured with them. Any appropriation in whatever amount by the City to the Authority shall be treated as income of the Trust Estate and expenditures by the City itself to pay costs of operation and maintenance of the Trust Estate shall be deducted from the costs of operation and maintenance of the Trust Estate in calculating the Net Revenues of the Trust Estate. In the event no such appropriation or expenditure is made or is insufficient in amount, then the Authority must immediately revise its rate schedules to remedy any resultant deficiency in its revenues so that its Net Revenues shall at all times be equal to one and one-quarter (1.25) times average annual debt service charges. The purpose of these provisions is to permit lower charges for the water and sanitary sewer services rendered to the people of the City so long as the City makes sufficient appropriations to transfer the funds so appropriated to the Authority.

Since no city council can bind itself nor be bound by an act either of its predecessors or by the terms of the election authorizing sales tax to make any such appropriation, the members of the Authority whose membership is identical with that of the City Council, have pledged that in the event that the City Council fails to make the appropriation or for any reason, amounts so appropriated are not paid over to the Authority or are insufficient in amount, the members of the Authority, in their capacity as Authority Trustees, will immediately increase rates, charges, and fees for services rendered by the Trust Estate in that amount which will produce net revenues equal to one and one-quarter (1.25) times average annual debt service charges for Series 2020 Bonds and all bonds equally secured with them.

[THIS SPACE INTENTIONALLY LEFT BLANK]

15

COMPARATIVE REVENUE AND EXPENDITURES

2019 2018 2017Revenues Water 9,861,427$ 10,634,597$ 10,322,486$ Sewer 1,894,794 1,691,855 1,629,596 Sanitation 1,291,633 1,253,285 1,037,854 General Government - - 118,705 Licenses & Permits 81,190 114,785 - Rental Receipts - - 4,800 Other - - 639,977 Misc 594,330 601,491 492,058 Total Revenues 13,723,374$ 14,296,013$ 14,245,476$

Expenses General & Admin 2,352,836$ 2,121,744$ 2,481,344$ Economic Development 626,590 357,004 472,253 Cultural & Recreational 53,651 55,802 48,331 Water Service 7,789,750 8,429,975 7,769,045 Sewer Service 1,715,243 997,948 903,917 Stormwater Drainage 321,981 176,347 - Solid Waste Service 1,150,617 1,108,759 1,009,091 Total Expenses (1) 14,010,668$ 13,247,579$ 12,683,981$

Net Income (Loss) (287,294)$ 1,048,434$ 1,561,495$

Non-Operating Revenues (Expenses) Investment Income 792,647$ 342,618$ 107,041$ Miscellaneous 122,619 Total Non-Operating Revenues (Expenses) 915,266$ 342,618$ 107,041$

Funds Available Before Sales Tax Transfer 627,972$ 1,391,052$ 1,668,536$

Sales Tax (3 Cents) (2) 6,068,565$ 5,963,058$ 5,796,930$

Total Funds Available for Debt Service 6,696,537$ 7,354,110$ 7,465,466$

Debt Service Requirement Series 2020 Debt Service (Projected) 340,000$ 340,000$ 340,000$ Series 2019 Debt Service (Average Annual) 751,717 751,717 751,717 Total Debt Service Requirement 1,091,717$ 1,091,717$ 1,091,717$

Coverage 6.13 9.78 9.93

(1) Depreciation not included(2) pledged 3 cents collected as per Oklahoma Tax Commission*On June 2, 2020, the Authority implemented a 7% water and sewer rate increase effective October 1, 2020. (see Exhibit B)

16

The Comparative Revenue and Expenditures Statements are based upon the City’s certified audits and a copy of the fiscal year ended June 30, 2019 audit is included as Exhibit D and should be read in full. Copies of previous audits are available upon request from The Baker Group LP, or the Authority.

THE DEPOSITORY

The Authority is from time to time to designate a bank or banks, preferably in Jenks, Oklahoma, which shall act as Depository for The Jenks Public Works Authority Gross Revenue Account and Bond Account, and from which withdrawals are to be made as stipulated in the section "Flow of Funds" which follows. THE TRUSTEE BANK

BancFirst, Oklahoma City, Oklahoma, will act as Trustee for the holders of the Series 2020 Bonds, and is to hold the Indenture securing the Series 2020 Bonds, and perform such other duties as have or may be agreed upon and as are outlined briefly in the paragraphs that follow and fully in the Indenture. THE REGISTRAR

BancFirst, Oklahoma City, Oklahoma, will act as Registrar for this issue and will register ownership and transfer of the Series 2020 Bonds on books kept for that purpose and act as paying agent on behalf of the Authority. Interest shall be paid by check or draft mailed by the Registrar to bondholders of record on the Record Date which is the 15th day of the month next preceding each interest payment date whether or not such date is a business day. FLOW OF FUNDS

A. All payments of properties and equipment purchased, for professional services, labor

and materials furnished, and for all construction performed and for deposit to the Sinking Fund during construction; and

B. Any remainder shall be retained in the Construction Fund to be used later for the same

purpose for which the proceeds of the Bonds are to be used, or transferred to the Sinking Fund and used to diminish payments otherwise required to be made into it.

I. BOND PROCEEDS: The proceeds of the Series 2020 Bonds will be deposited in the Bank in The Jenks Public Works Authority Series 2020 Construction Fund, except that accruedinterest will be deposited directly into The Jenks Public Works Authority Sinking Fund,described in paragraph III. All fees and expenses for services in connection with the issuanceof the Series 2020 Bonds shall be paid to the persons entitled thereto.

17

II. AUTHORITY REVENUES: The Depository Bank shall receive daily all money received

from the Trust Estate into an account known as The Jenks Public Works Authority Gross Revenue Account and hereafter called the "Gross Revenue Account". The Authority has the sole authority to withdraw money from the Gross Revenue Account. From the Gross Revenue Account there is to be paid in the following order:

A. Costs and expenses of and incidental to the operation and ordinary maintenance of the Trust Estate, including but not limited to payments due under any contract for the operation and maintenance of the Systems, the necessary costs and expenses of and incidental to the collection of revenues of the Trust Estate and fees and expenses of the Bank and Registrar.

B. The sums required for payment of principal of and interest on the Series 2020 Bonds are

to be deposited in The Jenks Public Works Authority Bond Account, as defined in the Indenture (the “Bond Account”), to be held by the Depository but with the sole right of withdrawal from the Bond Account vested in the Bank. Bond Account deposits are to be made monthly and in as nearly equal amounts as may be practicable.

C. The remainder is to be used for any proper purpose of the Authority, including, but not

limited to, purchase of any Series 2020 Bonds or any other equally secured indebtedness on the open market, redemption of bonds of this or equally secured debt prior to maturity, or payments to or for the City.

All deposits made by the Authority must be in banks the accounts of which are insured by the

Federal Deposit Insurance Corporation (the "F.D.I.C.") and any deposit in excess of that amount insured by the F.D.I.C. must be secured as are the deposits of uninvested sinking funds of political subdivisions of the State of Oklahoma, or in the case of deposits in the Bank, in the manner prescribed by federal law for securing trust funds. III. DEBT SERVICE: From the Bond Account the Bank shall, not later than each interest and

principal payment date so long as these Series 2020 Bonds remain outstanding, withdraw therefrom the accumulated sum and deposit it in the Sinking Fund, as defined in the Indenture, which it holds (the “Sinking Fund”). The Sinking Fund is to be used by the Bank for payment of principal of and interest on the Series 2020 Bonds as they mature. The withdrawals are to be made in that amount which will permit payment of principal of and interest on Series 2020 Bonds as they become due.

18

IV. INVESTMENT OF FUNDS:

A. All funds not specifically mentioned in "Flow of Funds" section are to be kept continuously invested in conformance with its use and applicable law to yield the highest annual return for the benefit of the Authority subject to the security provisions as provided in subsection II herein entitled "Authority Revenues".

ADDITIONAL BONDS

Provided no state of default exists under the Indenture, additional debt equally secured with this debt may be incurred under the following conditions:

1. Any such secured additional indebtedness shall be incurred only for acquiring, constructing, extending, improving, protecting or enlarging the properties and facilities of the Trust Estate, or of the City of Jenks, or to effect major repairs and replacements to the Trust Estate or for refunding any outstanding indebtedness of the Authority incurred for any of the foregoing purposes.

2. No such additional indebtedness shall be incurred unless the Net Revenues of the

Trust Estate (hereinabove defined) shall, as certified by a Certified Public Accountant, have been at an annual rate equal to one and one-quarter (1.25) times average annual debt service charges of the outstanding bonds for the preceding fiscal year and projected Net Revenues for the calendar year immediately following completion of any such authorized project shall be equal to one and one-quarter (1.25) times the Average Annual Debt Service charges of the outstanding Series 2019 Bonds, the Series 2020 Bonds, and any indebtedness secured equally therewith. In making the calculations, increased utility rates and increased sales taxes then in effect may be assumed to have been in effect during the period under consideration. Debt service charges for the Series 2019 Bonds and the Series 2020 Bonds are shown in Exhibit A.

3. The supplemental indenture providing for any such additional equally secured

debt shall provide that payments into the Bond Account and Sinking Fund shall be increased in such amounts as shall be necessary to service the additional bonds. The deposits or payments into the Bond Account and Sinking Fund required for each series of equally secured bonds are to be commingled with all other deposits and payments made into such account or fund under the Indenture.

19

BOND COVENANTS

Pursuant to the Indenture, the Authority has made certain covenants, which include the following:

1. The Authority has good right and lawful authority to execute and deliver the conveyance set forth in the Indenture, and all of said property is free and clear of all liens, claims, demands, encumbrances and governmental charges which could or in any manner might adversely affect or prejudice the rights, interests, privileges, powers and liens provided in the Indenture, and the Authority, so often as requested so to do by the Bank or any holder of any Series 2020 Bond promptly will execute and deliver all such other and further instruments and do, or cause to be done, all such other and further things, as reasonably shall be required to vest in the Bank all of the rights, powers and benefits intended to be conveyed, assigned and conferred by the Indenture.

2. The Authority will not suffer or permit any lien or encumbrance upon any of the

property or revenues conveyed as security under the terms of the Indenture, or any part of said property or revenues, to be or become superior or in preference to the lien created by the Indenture, neither will the Authority do or suffer to be done any act or thing whereby the security provided in the Indenture shall be diminished or impaired.

3. The Authority forever will defend the unimpaired and unencumbered right, title

and interest in and to each and every part of the property and revenues mentioned in the Indenture against all claims and demands asserted by any person or entity whatsoever to be prior or preferential to the lien created by the Indenture, and the Authority, upon request by the Bank or by the holder of any Series 2020 Bond, promptly will take such action as reasonably shall be required to extinguish any defect or cloud upon the rights, title and interests described as aforesaid whether presently existing or hereafter coming into existence; and the Authority will save harmless the Trustee and each holder of any Series 2020 Bond from all loss, cost, expense and damage with respect to any of the foregoing.

4. The Authority will maintain a schedule of utility charges, fees and rates sufficient

(together with sales tax receipts appropriated and paid over to the Authority), to produce Net Revenues annually not less than one and one-quarter (1.25) times average annual debt service requirements on the Series 2019 Bonds and the Series 2020 Bonds and all equally secured bonds after payment of all operation and maintenance costs and expenses of the Trust Estate.

20

5. The Authority will keep the Systems insured by all forms of insurance ordinarily carried by reasonably prudent operators of like properties, the policies to be payable to the City and/or the Bank as their interests shall appear and either the policies or certificates of insurance are to be delivered to the Bank promptly upon issuance thereof.

6. The Authority will maintain the Systems in first-class working condition and will

not remove or dispose of any of the mortgaged properties without written consent of the Bank.

7. The Authority will maintain its right to operate, and will operate the Systems so

long as any bonded indebtedness remains outstanding, will comply with all applicable laws, rules and regulations, and will give no free service except to the City for strictly governmental purposes.

8. The proceeds of these bonds will be used solely for the purposes for which they

were issued, as briefly outlined in a preceding paragraph entitled "Purpose of Issue" and as described in complete detail in the Indenture itself under which they are issued and for refunding interim or temporary debt incurred by the Authority for the same purposes.

9. All monies collected by the Authority will be applied in the manner provided in

the preceding section entitled "Flow of Funds".

10. The Authority will keep proper books, records and accounts in accord with good accounting practices which shall at all reasonable times be made available to bondholders or their representatives. That, within 180 days following the close of its fiscal year, it will supply to the Bank, the City, The Baker Group, Oklahoma City, Oklahoma, and to any bondholder who so requests, an annual audit of its operations during the preceding fiscal year, prepared by a Certified Public Accountant. If so requested by the Bank or the holders of at least 51% of the outstanding debt, such Certified Public Accountant shall be named by the Bank or the bondholders.

11. The Authority will incur no additional indebtedness secured by the revenues of

the Trust Estate, or the Systems, (a) if it is in default in any of its covenants; and (b) unless the additional debt be issued in full compliance with all requirements of the paragraph entitled "Additional Bonds".

12. Any provision in the Indenture may be amended by the agreement of the Authority

and the Bank with the consent given in writing to the Bank by the holders of not less than 75% of all the equally secured bonds then outstanding except, however:

21

a. The aforesaid percentage of seventy-five percent (75%) shall not be reduced without the consent of the holders of all of the outstanding indebtedness;

b. Any reduction made in the rate of interest must apply equally to all bonds

unless otherwise consented to in writing by the holder of the excepted bonds;

c. That in the event that there shall be an extension of maturities serially, the

same relative position in the extended schedule shall be retained for each bond as in the maturity schedule of the bonds as originally issued, unless otherwise consented to in writing by the holder of the excepted bonds. However, if the extension of maturities is made into a single maturity, the extension shall apply to all bondholders; and

d. That no bond be given preference in security over any other;

13. It is also provided that in the event monies in an amount which shall be sufficient

or direct obligations of the United States or of agencies of the United States fully guaranteed by the United States are placed in a special escrow account for the sole purpose and in sufficient amount that the principal and interest earned when due shall provide funds to pay promptly and fully as they mature, both interest on and principal of the Series 2020 Bonds or in the alternative, on such earlier date any of said outstanding bonds, respectively, are callable for redemption prior to maturity, in the latter event, together with any premium payable upon such redemption, at which time the lien securing them by the Trust Estate shall be released.

14. The Authority will timely prepare and file, or cause to be prepared and filed, any

and all reports or returns required under the Internal Revenue Code of 1986, as amended, in order to preserve the federal tax-exempt status of the interest payable on the Series 2020 Bonds and the Authority will timely meet the rebate requirements of the Internal Revenue Code of 1986, as amended, including but not limited to, payment of any required rebates to the United States, relating to income derived from investment of the proceeds of the Series 2020 Bonds.

DEFEASANCE

The Series 2020 Bonds shall be defeased if, among other things, there are sufficient monies, the principal of and interest on which when due will provide monies, which together with the monies, if any, deposited with the Bank at the same time are sufficient to pay when due the principal or redemption price of and interest due, and to become due, on the Series 2020 Bonds, on and prior to the redemption date or maturity date thereof, as the case may be.

22

DEFAULTS AND REMEDIES

The Indenture makes the happening or existence of any fact incompatible with its provisions a default including, but not limited to, the failure to pay the principal of and interest on the Series 2020 Bonds when due.

All of the customary remedies, including acceleration of maturities, receivership, etc., are made available to the Bank and to all bondholders. An additional remedy is also provided which permits the appointment of temporary Trustees in sufficient number to constitute a majority of the Trustees. This device permits continued operation of the properties under control of the bondholders without endangering the tax-free status of the property or its operation as a governmental agency. It is simple to apply, is inexpensive and continues in effect until the default is cured. All remedies expressly are made concurrent and elective.

LEGAL OPINIONS

Certain legal matters incident to the authorization, issuance, validity, and tax-exemptions of the Series 2020 Bonds are subject to the approval of Johanning & Bryom, PLLC, Oklahoma City, Oklahoma, Bond Counsel, copies of whose approving opinion will be available at the time of delivery of the Series 2020 Bonds, and by Floyd Law Firm, P.C., Norman, Oklahoma, Counsel to the Underwriter.

NO LITIGATION

There is not now pending, or to the knowledge of the Authority, threatened any litigation: (a)

restraining or enjoining the execution and delivery of the Indenture; (b) contesting, disputing, or affecting the ability of the Authority to secure the Series 2020 Bonds as described in the Indenture; or (c) in any way limiting the approval or the issuance or delivery of this Official Statement or the Series 2020 Bonds or questioning or affecting the validity of the Series 2020 Bonds or the proceedings and authority under which they are to be issued. Neither the creation, organization nor existence of the Authority, nor the title of the present trustees or officers of the Authority to their respective offices, nor the powers of the Authority to enter into or carry out the transactions contemplated by the Indenture is being contested.

23

RATING

S&P Global Ratings has assigned a rating to the Series 2020 Bonds as shown on the cover of this Official Statement. The rating reflects only the view of such organization and an interpretation of the rating may be obtained only from the rating agency furnishing the same. There is no assurance that the rating will continue for any given period of time or that they will not be revised down or withdrawn entirely by such rating agencies, if circumstances so warrant. Any revision or withdrawal of the rating may have an adverse effect on the market price of the Series 2020 Bonds.

UNDERWRITING

The Series 2020 Bonds are to be purchased by D.A. Davidson & Co. (the “Underwriter”), pursuant to a Contract of Purchase with the Authority (the “Contract of Purchase”), subject to certain conditions described therein. The Underwriter has agreed to purchase the Series 2020 Bonds at a price of $_____ (which represents the $_______ principal amount of Series 2020 Bonds, plus reoffering premium of $_______, less Underwriter's Discount of $______, and plus accrued interest, if any). The Contract of Purchase provides that the Underwriter will not be obligated to purchase any Series 2020 Bonds if all Series 2020 Bonds are not available for purchase, and requires the Authority to indemnify the Underwriter against losses, claims, damages and liabilities arising out of any incorrect or incomplete statements or information contained in this Official Statement pertaining to the Projects and other matters. The initial public offering price set forth on the inside cover page hereof may be changed by the Underwriter.

The Underwriter intends to offer the Series 2020 Bonds to the public initially at the offering

prices set forth on the inside cover page of this Official Statement, which offering prices may subsequently be changed without any requirement of prior notice. The Underwriter has reserved the right to permit other securities dealers who are members of the Securities Industry & Financial Markets Association to assist in selling the Series 2020 Bonds. The Underwriter may offer and sell Series 2020 Bonds to certain dealers at prices lower than the public offering price or otherwise allow concessions to such dealers who may re-allow concessions to other dealers. Any discounts and/or commissions that may be received by such dealers in connection with the sale of the Series 2020 Bonds will be deducted from the underwriting discount.

In connection with the offering of the Series 2020 Bonds, the Underwriter may overallot or

effect transactions which stabilize or maintain the market prices of the Series 2020 Bonds at levels above those which might otherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued at any time.

Subject to prevailing market conditions, the Underwriter intends, but is not obligated, to

engage in secondary market trading in the Series 2020 Bonds, subject to applicable securities laws. However, none of the Authority, the City, the Trustee, or the Underwriter is obligated to repurchase any of the Series 2020 Bonds at the request of the holders thereof.

24

The Underwriter has provided the following sentence for inclusion in this Official Statement.

The Underwriter has reviewed the information in this Official Statement in accordance with, and as a part of, its responsibilities under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information and this Official Statement is not to be construed as the promise or guarantee of the Underwriter.

The Underwriter is not acting as a financial advisor or municipal advisor in connection with

the issuance of the Series 2020 Bonds.

FINANCIAL ADVISOR

The Authority's financial advisor is The Baker Group LP, Oklahoma City, Oklahoma. The Baker Group LP has prepared certain information for this Official Statement in connection with its services to the Authority and has provided financial advice to the Authority in connection with the Series 2020 Bonds.

CONTINUING DISCLOSURE

The Authority will execute and deliver its Continuing Disclosure Agreement (the "Continuing Disclosure Agreement") for the benefit of the holders and beneficial owners of the Series 2020 Bonds. The Authority is required to observe the Continuing Disclosure Agreement for so long as it remains obligated to pay the Series 2020 Bonds. Pursuant to the Continuing Disclosure Agreement, the Authority will be obligated to provide certain updated financial information and timely notice of certain specified events, to the Municipal Securities Rulemaking Board (the "MSRB") through its Electronic Municipal Market Access ("EMMA") system at www.emma.msrb.org. See Exhibit G - Continuing Disclosure Agreement.

A failure by the Authority to comply with the Disclosure Agreement will not constitute a default or an “Event of Default” under the Series 2020 Bonds or the Indenture. A broker or dealer is to consider a known breach of the Continuing Disclosure Agreement, however, before recommending the purchase or sale of the Bonds in the secondary market. Consequently, such a failure may adversely affect the transferability and liquidity of the Series 2020 Bonds and their market price.

If the Authority fails to comply with any the Continuing Disclosure Agreement, the Trustee or Beneficial Owners of any outstanding Series 2020 Bonds may enforce performance and observance thereof, including an action for a writ of mandamus or specific performance. Direct, indirect, consequential and punitive damages shall not be recoverable for any default thereunder to the extent permitted by law. Notwithstanding anything to the contrary contained herein, in no event shall a default under the Continuing Disclosure Agreement constitute a default under the Series 2020 Bonds or under any other provision of the Indenture.

25

As used herein, “Owner” or “Bondowner” means, in respect of a Bond, the registered owner or owners thereof appearing in the bond register maintained by the Trustee or any Beneficial Owner (as hereinafter defined) thereof, if such Beneficial Owner provides to the Registrar evidence of such beneficial ownership in form and substance reasonably satisfactory to the Registrar. As used herein, “Beneficial Owner” means, in respect of a Series 2020 Bond, any person or entity which (i) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, such Series 2020 Bond (including persons or entities holding Bonds through nominees, depositories or other intermediaries), or (b) is treated as the owner of the Series 2020 Bond for federal income tax purposes. Annual Reports

The Authority will provide certain updated financial information annually. The information to be updated includes the Authority’s annual audited financial statements and the preceding fiscal year’s information concerning the Authority’s revenue, expenditures, debt service requirements, and coverage ratio as provided in the table entitled “Comparative Revenue and Expenditures” provided in the Official Statement for the Series 2020 Bonds (the “Annual Report”). The Authority will update and provide this information within 180 days after the end of each fiscal year. The Authority’s fiscal year end is June 30th. The Authority will provide updated information to the Trustee who will provide it to the MSRB.

The Authority may provide updated information in full text or may incorporate by reference other publicly available documents, as permitted by United States Securities and Exchange Commission Rule 15c2-12 (the “Rule”). The updated information will include audited financial statements if the Authority commissions an audit and the audit is completed by the required time. If audited financial statements are not available by the required time, the Authority will provide such financials statements on an unaudited basis within the required time and audited financial statements when they become available. Any such financial statements will be prepared in accordance with generally accepted (“GAAP”) accounting principles or such other accounting principles as the Authority may be required to employ from time to time pursuant to State law or regulation. Material Event Notices

The Authority will file with the MSRB notice of any of the Material Events listed in the Continuing Disclosure Agreement with respect to the Bonds in a timely manner (and not more than 10 business days after occurrence of the event). In addition, the Authority will provide timely notice of any failure by the Authority to provide information, data, or financial statements described above under Annual Reports in accordance with the Continuing Disclosure Agreement. The Authority will provide each notice described in the Continuing Disclosure Agreement to the MSRB.

26

Compliance with Prior Undertakings The Authority has entered into prior continuing disclosure undertakings pursuant to the Rule with respect to its currently outstanding Series 2019 Bonds and its no longer outstanding Series 2012 Bonds (the “Prior Undertaking”).

The Rule requires that an issuer or other obligated person disclose in an official statement any instances in the previous five years in which such issuer or other obligated person failed to comply, in all material respects, with any previous undertakings in a written contract or agreement specified in paragraph (b)(5)(i) of the Rule. During the last five years, the Authority has failed to comply with continuing disclosure requirements. The Continuing Disclosure Agreement for the Prior Undertaking requires filing the Annual Report to include the City’s Audited Financial Statements within 180 days of the ending of the fiscal year on June 30. The Authority did not timely file audited financial statements for its fiscal years ended June 30, 2015 through 2019, and did not timely file operating data for the year 2019, as required by the Series 2019 Bonds Continuing Disclosure Agreement, which would have provided the Comparative Revenues & Expenditures Table. Further, the Authority did not file or timely file notice of its failure to provide the aforementioned information on or before the date specified in its prior continuing disclosure undertakings.

The Continuing Disclosure Agreement executed in connection with the issuance of the Series

2020 Bonds will provide for the disclosure of Annual Financial Information as provided for in the Indenture and Audited Financial Statements no later than 180 days after the close of the Authority’s fiscal year.

The Authority has covenanted to provide the final Official Statement to the purchaser within

seven business days after final agreement to purchase, offer, or sell the Bonds in an offering and in sufficient time to accompany any confirmation that request payment from any customer.

DEEMED FINAL

THE AUTHORITY HAS CERTIFIED THAT THIS OFFICIAL STATEMENT WAS DEEMED FINAL AS OF ITS DATE FOR PURPOSES OF RULE 15c2-12(b), EXCEPT FOR THE INFORMATION NOT REQUIRED TO BE INCLUDED THEREIN UNDER RULE 15c2-12(b).

Concurrently with the delivery of the Series 2020 Bonds, the Authority will furnish to the Underwriter a certificate executed on behalf of the Authority by proper officers of the Authority, acting in their official capacity, to the effect that the final Official Statement, as of the date of the final Official Statement and as of the date of delivery of the Bonds: (a) the description and statements of or pertaining to the Authority and the City contained in this Official Statement, and any addenda, supplement, or amendment thereto, on the date of such Official Statement, were and are true and correct in all material respects: (b) insofar as the Authority and the City and its affairs, including its financial affairs, are concerned, such Official Statement did not and does not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not

27

misleading; (c) insofar as the descriptions and statements, including financial data, of or pertaining to entities, other than the City, and their activities contained in such Official Statement are concerned, such statements and data have been obtained from sources which the Authority believes to be reliable and the Authority has no reason to believe that they are untrue in any material respect; and (d) there has been no material adverse change in the financial condition of the City since the date of the last audited financial statements of the City. MISCELLANEOUS

Information concerning the Authority, the Project, the audited financial statements for fiscal year ending June 30, 2019, and the Series 2020 Bonds contained in this Official Statement has been furnished by the Authority.

The foregoing summaries or descriptions of provisions in the Indenture and all references to other materials not purporting to be quoted in full, are only brief outlines of certain provisions thereof and do not constitute complete statements of such provisions and do not summarize all the pertinent provisions of such provisions. For further information, reference should be made to the complete documents, copies of which are on file at the corporate trust offices of the Trustee for examination and will be furnished by the Authority upon request.

All projections and other statements in this Official Statement and Appendices hereto involving matters of opinion, whether or not expressly so stated, are intended as such and not as representations of fact. Any statements in this Official Statement and Appendices hereto involving estimates or assumptions, whether or not expressly so stated, are intended as such and no representation whatsoever is made that such estimates or assumptions are correct or will be realized. Neither this Official Statement, nor any statement that may have been made orally or in writing, is to be construed as a contract or agreement between the Authority and the purchasers or holders of any of the Series 2020 Bonds. All information contained in this Official Statement and Appendices hereto pertaining to the Authority and the City has been furnished by the Authority and the City for use herein. All information contained in this official Statement and Appendices is subject to change and/or correction without notice and neither the delivery of the Official Statement nor any sale made hereunder shall create any implication that the information contained herein is complete or accurate in its entirety as of any date after the date hereof.

APPROVAL OF OFFICIAL STATEMENT

This Official Statement has been approved by the Authority for distribution to prospective purchasers of the Series 2020 Bonds. THE JENKS PUBLIC WORKS AUTHORITY

By: /s/ Robert Lee Chairman of Trustees

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

EXHIBIT A AMORTIZATION SCHEDULE Dated: Date of Delivery Due: August 1, (see below) Years Principal Interest Rate Interest Total P&I 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

EXHIBIT B

ECONOMIC INDICES THE CITY

The following information is intended only as general information about the City. The City is in no way obligated to repay any portion of the Series 2020 Bonds. GENERAL

The City of Jenks, Oklahoma, incorporated as a City in 1905, is located in northeast Oklahoma, in Tulsa County, approximately ten miles southeast of the City of Tulsa, Oklahoma. The city encompasses approximately 15 square miles. The City employs 100 persons and provides all of the normally recognized city services to its citizens including police and fire protection, water, sewer and solid waste disposal services. Electric service is provided by AEP/PSO, East Central Electric and OG&E, telephone service by AT&T, and natural gas by Oklahoma Natural Gas Company. TRANSPORTATION

Air Transportation. Tulsa’s general aviation airport, Jones Riverside Airport (RVS) is immediately adjacent to the Jenks city limits. RVS has two parallel runways and a cross wind runway. The longest runway is 5,100 feet. RVS is a FAA Tower controlled facility. The nearest commercial airport is 20 miles from Jenks at Tulsa, Oklahoma. This airport is a full service field with three runways, the longest having a total runway length of 10,000 feet. There are at least 6 major commercial airlines operating out of Tulsa International Airport. There are several air freight companies in operation.

Water Transportation. The nearest water transportation is the Port of Catoosa. It is 26 miles from Jenks and has a channel depth of 9 feet. It is connected via the Arkansas River to the Mississippi River and the Gulf of Mexico.

Road System. Jenks is located at the intersection of US 75 and Main Street (96th Street South). The nearest interstate highway is I-44, approximately 4 miles to the north. The Creek Turnpike crosses Jenks east-west with entrances to downtown Jenks at Elm and US 75.

THE SYSTEMS

SANITARY SEWER SYSTEM

Jenks has an oxidation ditch, activated sludge system of treatment which is professionally operated by a contractor. The City’s sewage treatment system is currently operating at approximately 67% of capacity. The Authority presently has 8,446 sewer accounts. Sewer Treatment Capacity and Load Measurement Capacity Present Load Gallons per day 3,000,000 2,040,000 Population equivalent 34,344 23,354

WATER SYSTEM Storage Capacity Daily Consumption Pressure in Mains Source Capacity Ground: 15,000,000 GPD Max: 1,190,000 GPD Max 120 PSI Purchased 170,000,000 GPD Elevated: 65,000,000 GPD Min: 758,600 GPD Min 60 PSI from City of Tulsa

The Authority presently has 8,781 water accounts.

MAJOR EMPLOYERS

The major employers located in the City, the type of business engaged in, and the approximate

number of employees are shown below:

Approximate Number of

Company Name Product Employees

Jenks Public Schools

Educational

1,649 Kimberly-Clark Corp.

Tissue Mfg.

525 Gateway Mortgage

Financial Institution

307 Tulsa Winch Group

Industrial Machinery

231 CORE

Medical Facility

205 Reasor’s

Retail Grocery

135 City of Jenks

City Services

128 Grace Living Center

Nursing Home

125 Flying Tee

Entertainment

123 First Oklahoma Bank

Financial Institution

122

Wal-Mart Neighborhood

Retail Grocery

93 Oklahoma Aquarium

Aquarium

61 Air Comfort

HVAC Contractors

60

_______________ Source: City of Jenks

EDUCATION

Jenks consistently ranks at or near the top in objective academic testing. Some areas in Jenks are served by the Bixby and Glenpool school districts. Jenks has access to numerous educational institutions. Located within easy driving distance is Oklahoma State University, one of the three largest universities in the state, and OU/OSU-Tulsa. Nearby Tulsa has two excellent private universities: Oral Roberts University and Tulsa University. Tulsa Community College is available also with several campus locations around Tulsa. The state of Oklahoma has 6 career-technology centers in Tulsa able to serve the Jenks area. POPULATION

The 2020 estimated population of the City is presently 24,442 people. The historical

population of the city is as follows:

Year Population 2010 16,924 2000 9,557 1990 7,812 1980 5,896 1970 2,685 1960 1,734 1950 1,037 1940 1,026

Source: U.S. Census Building Permits

Calendar Number of Year Building Permits 2011 272 2012 348 2013 408 2014 446 2015 432 2016 448 2017 377 2018 323 Source: City of Jenks

Net Valuation Trends

2018/19 $298,831,438 4.79% 2017/18 285,181,575 6.73% 2016/17 267,196,602 7.88% 2015/16 247,674,819 4.65% 2014/15 236,662,513 n/a Source: Official Estimate of Needs Utility Connections Water Sewer Year Meters Connections 2020 8,781 8,446 2019 8,666 8,331 2018 8,475 8,139 2017 8,245 7,921 2016 7,946 7,624 2015 7,654 7,333 Source: City Officials Sales Tax Collections Avg Monthly Total 1 Cent 1 Cent FY Collections Collections Collections % Change 2019/20 $7,504,129 $2,113,839 $176,153 4.50% 2018/19 $7,181,135 $2,022,855 $168,571 1.77% 2017/18 $7,056,285 $1,987,686 $165,640 2.87% 2016/17 $6,216,173 $1,932,310 $161,026 7.25% 2015/16 $5,405,146 $1,801,715 $150,143 7.57% 2014/15 $5,024,736 $1,674,912 $139,576 N/A 2019/20 Collections are 3.55 cents for 12 months. 2018/19 Collections are 3.55 cents for 12 months. 2017/18 Collections are 3.55 cents for 12 months. 2016/17 Collections are 3.55 cents for 5 months and 3 cents for 7 months. 2015/16 Collections are 3 cents for 12 months. 2014/15 Collections are 3 cents for 12 months. Source: Oklahoma Tax Commission

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

EXHIBIT C

UTILITY RATES

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

CITY

OF

JEN

KS, O

KLAH

OM

A

WAT

ER/S

ANIT

ARY

SEW

ER R

ATES

AS O

F O

CTO

BER

1, 2

020

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

EXHIBIT D

CITY OF JENKS, OKLAHOMA ANNUAL FINANCIAL STATEMENTS

FOR FISCAL YEAR ENDED JUNE 30, 2019

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

CITY OF JENKS, OKLAHOMA

ANNUAL FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR’S REPORTS

FOR THE FISCAL YEAR ENDED

JUNE 30, 2019

 

 

 

 

 

CITY OF JENKS, OKLAHOMA 

 

ANNUAL FINANCIAL STATEMENTS 

AND 

INDEPENDENT AUDITOR’S REPORT 

 

FOR THE FISCAL YEAR ENDED 

JUNE 30, 2019 

CITY OF JENKS Jenks, Oklahoma

CONTENTS

Page No.

Independent Auditor's Report 1-2 Management’s Discussion and Analysis 3-13 Basic Financial Statements:

Government-Wide Financial Statements: Statement of Net Position 14 Statement of Activities 15

Fund Financial Statements:

Balance Sheet - Governmental Funds 16

Reconciliation of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Position 17

Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds 18

Reconciliation of the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balance to the Government-Wide Statement of Activities 19

Statement of Fund Net Position - Proprietary Funds 20 Statement of Revenues, Expenses and Changes in Fund Net Position - Proprietary Funds 21

Statement of Cash Flows - Proprietary Funds 22-23

Notes to the Basic Financial Statements 24-55

Required Supplemental Information: Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual (Budgetary Basis) – General Fund 56 Notes to Required Supplemental Information 57-58 Schedule of Share of Net Pension Liability – Police Pension 59 Schedule of City Contributions – Police Pension & Retirement System 59 Schedule of Share of Net Pension Liability – Firefighter’s System 60 Schedule of City Contributions – Firefighter’s Pension & Retirement 61 Schedule of Changes in Total OPEB Liability and Related Ratios 62

CITY OF JENKS Jenks, Oklahoma

CONTENTS

Page No.

Other Information: Combining Balance Sheet – General Fund Accounts 63

Combining Schedule of Revenues, Expenditures and Changes in Fund Balances – General Fund Accounts 64 Combining Balance Sheet – Non-Major Governmental Funds 65-67

Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Non-Major Governmental Funds 68-70 Combining Statement of Net Position – JPWA Accounts 71

Combining Schedule of Revenues, Expenses and Changes in Fund Net Position – JPWA Accounts 72 Schedule of State Awards 73 Report Required by Government Auditing Standards: Independent Auditor’s Report on Internal Control over Financial Reporting and on

Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 75-76

  

309 N. Bryant Ave. • Edmond, OK 73034 • 405.348.0615 • Fax 405.348.0931 • www.jmacpas.com Member of AICPA and OSCPA

INDEPENDENT AUDITOR’S REPORT

To the Honorable Mayor and Members of the City Council City of Jenks, Oklahoma

Report on the Financial Statements

We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Jenks, Oklahoma (the “City”), as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the City’s basic 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.

Auditor’s Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design 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 opinions.

Opinions

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2019, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

1

 

  

Other Matters

Required Supplementary Information

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

Other Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual nonmajor fund financial statements and schedules, as listed in the table of contents, are presented for purposes of additional analysis and are not a required part of the basic financial statements.

The combining and individual nonmajor fund financial statements and schedules, as listed in the table of contents, are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements and schedules, as listed in the table of contents, are fairly stated in all material respects in relation to the basic financial statements as a whole.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated May 11, 2020, on our consideration of the City’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 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 City’s internal control over financial reporting and compliance.

May 11, 2020   

2

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited

Introduction  Our discussion and analysis of  the City of  Jenks  financial performance provides an overview of  the City’s  financial activities for the fiscal year ended June 30, 2019.  Please read it in conjunction with the City’s financial statements, which follow.  Overview of Financial Statements and Financial Analysis  The  financial  statements  presented  herein  include  all  of  the  activities  of  the  City  of  Jenks  (the  “City”)  and  its component units using the integrated approach as prescribed by GASB Statement No. 34.  Included in this report are governmental‐wide statements for each of two categories of activities – governmental and business‐type.  Government‐wide Financial Statements The  government‐wide  financial  statements  present  the  complete  financial  picture of  the City  from  the  economic resources  measurement  focus  using  the  accrual  basis  of  accounting.    They  present  governmental  activities  and business  type  activities  separately  and  combined.    These  statements  include  all  assets  of  the  City  (including infrastructure) and deferred outflows as well as all liabilities (including long‐term debt) and deferred inflows.  The two government‐wide financial statements are, as follows:  Statement of Net Position 

  The Statement of Net Position presents information on all of the City’s assets, deferred outflows of resources, 

liabilities, and deferred inflows of resources, with the difference reported as net position.  Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City of Jenks is improving or deteriorating.  

The Statement of Activities presents information showing how the City’s net position changed during the most recent fiscal year.  All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows.  Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods, such as revenues for uncollected taxes and expenses for future general obligation debt payments.  The statement includes the annual depreciation for infrastructure and governmental assets. 

 As mentioned above, in the Statement of Net Position and the Statement of Activities we divide the City into two kinds of activities:   Governmental activities. Most of the City’s basic services are reported here,  including the police, fire, general 

administration, streets, and parks.  Sales taxes, franchise fees, and fines finance most of these activities.  

Business‐type activities. The City charges a fee to customers to cover the cost of certain services it provides.  The City’s water and sewer service, Aquarium and Industrial Authority are reported here. 

 

3

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited 

Reporting the City’s Most Significant Funds  The fund financial statements provide detailed information about the most significant funds – not the City as a whole.  Some funds are required to be established by State law and by bond covenants.  However, management establishes many other funds to help  it control and manage money for particular purposes or to show that  it  is meeting legal responsibilities for using certain taxes, grants, and other money.   Governmental funds – Most of the City’s basic services are reported in governmental funds, which focus on how 

money flows into and out of those funds and the balances left at year‐end that are available for spending.  These funds are reported using an accounting method called modified accrual accounting, which measures cash and all other financial assets that can readily be converted to cash.  The governmental fund statements provide a detailed short‐term view of the City’s general government operations and the basic services it provides.  Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near  future  to  finance  the  City’s  programs.    The  differences  of  results  in  the  Governmental  Fund  financial statements to those in the Government‐Wide financial statements are explained in a reconciliation following each Governmental Fund financial statement.  

Proprietary funds – When the City charges customers for the services it provides – whether to outside customers or to other units of the City – these services are generally reported in proprietary funds.  Proprietary funds are reported in the same way that all activities are reported in the Statement of Net Position and the Statement of Revenues, Expenses and Changes  in Fund Net Position.    In fact,  the City’s enterprise funds, along with certain capital project funds, are the same as the business‐type activities we report in the government‐wide statements but provide more details and additional information, such as cash flows. 

  The City of Jenks’ Net Position 

The following table reflects a summary statement of net position compared to the prior year: 

 

TABLE 1NET POSITION (In Thousands)

% Inc. % Inc. % Inc.(Dec.) (Dec.) (Dec.)

2019 2018 2019 2018 2019 2018

Current assets 33,008$ 30,510$ 8% 41,943$ 44,283$ -5% 74,951$ 74,793$ 0%Capital assets, net 65,503 57,868 13% 27,206 25,692 6% 92,709 83,560 11% Total assets 98,511 88,378 11% 69,149 69,975 -1% 167,660 158,353 6%

Total deferred outflows 1,781 1,458 22% 809 860 -6% 2,590 2,318 12%

Current liabilit ies 3,476 3,216 8% 4,758 4,361 9% 8,234 7,577 9%Non-current liabilit ies 24,050 25,833 -7% 14,996 16,097 -7% 39,046 41,930 -7% Total l iabilities 27,526 29,049 -5% 19,754 20,458 -3% 47,280 49,507 -4%

Total deferred inflows 782 602 30% 7 8 100% 789 610 29%

Net position Net investment in capital assets 43,071 34,034 27% 14,511 11,753 23% 57,582 45,787 26% Restricted 19,990 18,558 8% 777 1,051 -26% 20,767 19,609 6% Unrestricted 8,925 7,594 18% 34,909 37,565 -7% 43,834 45,159 -3%

Total net position 71,986$ 60,186$ 20% 50,197$ 50,369$ 0% 122,183$ 110,555$ 11%

TotalGovernmental

Activities ActivitiesBusiness-Type

4

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited 

Explanations for the significant changes exceeding 20% and $500,000 include:  Governmental Activities: Net  investment  in capital assets –  Increased 27% ($9 million) mainly due to 1) normal debt service of $2.9 million exceeded debt issuances of $1.5 million and 2) excess other current year asset additions over depreciation of $7.6 million.  Business‐Type Activities: Net investment in capital assets – Increased 23% ($2.8 million) mainly due to 1) reduction of $1.5 million in capital related debt due to normal debt service payments and 2) excess other current year asset additions and transfers out over depreciation of $1.5 million  City of Jenks’ Changes in Net Position  

% Inc. % Inc. % Inc.

(Dec.) (Dec.) (Dec.)

2019 2018 2019 2018 2019 2018

RevenuesCharges for service 808$ 895$ -10% 18,373$ 18,769$ -2% 19,181$ 19,664$ -2%

Operating grants and contributions 742 606 22% 55 18 206% 797 624 28%

Capital grants and contributions 6,324 6,566 -4% 1,874 1,349 39% 8,198 7,915 4%

Taxes 14,619 13,437 9% - - 0% 14,619 13,437 9%

Intergovernmental revenue 263 225 17% - - 0% 263 225 17%

Investment income 592 255 132% 943 407 132% 1,535 662 132%

Miscellaneous 423 357 18% 735 610 20% 1,158 967 20%

Total revenues 23,771 22,341 6% 21,980 21,153 4% 45,751 43,494 5%

Expenses

General government 1,517 917 65% - - 1,517 917 65%

Public safety 6,284 6,378 -1% - - 6,284 6,378 -1%

Streets 3,089 2,763 12% - - 3,089 2,763 12%Economic development 1,158 877 32% - - 1,158 877 32%

Culture, parks and recreation 474 490 -3% - - 474 490 -3%

Interest on long-term debt 904 944 -4% - - 904 944 -4%

Water - - 10,501 10,838 -3% 10,501 10,838 -3%

Wastewater - - 2,810 2,468 14% 2,810 2,468 14%

Sanitation - - 1,474 1,352 9% 1,474 1,352 9%

Stormwater - - 142 17 735% 142 17 735%

Aquarium - - 5,770 5,142 12% 5,770 5,142 12%General operations - - - - 0% - - 0%

Total expenses 13,426 12,369 9% 20,697 19,817 4% 34,123 32,186 6%

Excess (deficiency) before

transfers 10,345 9,972 4% 1,283 1,336 -4% 11,628 11,308 3%

Transfers 1,455 (704) -307% (1,455) 704 307% - -

Increase (decrease) in net position 11,800$ 9,268$ 27% (172)$ 2,040$ -108% 11,628$ 11,308$ 3%

TABLE 2CHANGES IN NET POSITION (In Thousands)

Governmental Business-Type

Activities Activities Total

 Explanations for the significant changes exceeding 20% and $500,000 include:  Governmental Activities: General government expenses ‐ Increase of 65% ($0.6 million) mainly due to $0.2 million increase in salaries; and $0.2 million loss on disposal of capital assets.     

5

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited 

Business‐type Activities: Capital grants and contributions – 39%  increase  ($0.525 million) due mainly  to $0.7 million  increase  in developer dedicated utility infrastructure.   Investment income – 132% increase ($0.536 million) due to management’s aggressive push to purchase certificates of deposit with excess cash reserves. Interest rates on CDs increased year over year.  To aid in the understanding of the Statement of Activities some additional explanation is given.  Of particular interest in  the  format  that  is  significantly different  than a  typical  Statement of Revenues, Expenses, and Changes  in Fund Balance.    You will  notice  that expenses are  listed  in  the  first  column with  revenues  from  that particular program reported to the right.  The result is a Net (Expense)/Revenue.  The reason for this kind of format is to highlight the relative financial burden of each of the functions on the City’s taxpayers.  It also identifies how much each function draws  from  the  general  revenues  or  if  it  is  self‐financing  through  fees  and  grants  or  contributions.    All  other governmental revenues are reported as general.  It is important to note all taxes are classified as general revenue even if restricted for a specific purpose.  Governmental Activities: The  following  table  compares  fiscal  year  2019 and 2018  total Governmental Activities  expenses  and net  revenue (expense) of services:  

  Explanations for the significant changes exceeding 20% and $500,000, not previously explained in Table 2, include:  Governmental Activities:  General government expenses – 65% increase ($0.6 million) explained after Table 2  Streets – 33% decrease ($1.2 million) in net revenue; related to a $1 million decrease in capital contributions from Oklahoma Department of Transportation.  Culture and recreation net revenue (expense) – increase 250% ($0.9 million) mainly due to $0.9 million contribution from Tulsa County Vision 2025 funds. 

Net Revenue (Expense) of Governmental Activities(In Thousands)

% Inc. % Inc.(Dec.) (Dec.)

2019 2018 2019 2018

General government 1,517$ 917$ 65% (1,134)$ (327)$ 247%Public safety 6,284 6,378 -1% (5,400) (5,555) -3%Streets 3,089 2,763 12% 2,511 3,757 -33%Economic development 1,158 877 32% (1,158) (877) 32%Culture and recreation 474 490 -3% 533 (355) 250%Interest on long-term debt 904 944 -4% (904) (944) -4%

Total $13,426 $12,369 9% ($5,552) ($4,301) 29%

TABLE 3

Net RevenueTotal Expense (Expense)

of Services of Services

6

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited 

  Business‐type Activities: The  following  table  compares  fiscal  year  2019  and  2018  total  Business‐type  Activities  expenses  and  net  revenue (expense) of services:  

  Aquarium – decrease 187% ($0.6 million) in aquarium net revenue due to $0.288 million expenses in a new events department, depreciation expense increase of $0.09 million, and salaries increase of $0.24 million.  A Financial Analysis of the City’s Funds  As the City completed its 2019 fiscal year, the governmental funds reported a combined fund balance of $31.7 million, an increase of $2 million or 7%.  The enterprise funds reported a combined net position of $50.2 million, a decrease of $172K.   Other funds highlights include:  The General Fund (excluding combined accounts for financial reporting purposes) fund balance remained fairly stable, reporting an increase of $0.5 million or 3.7%.  The Vision Sales Tax Fund increased its fund balance by $1.4 million due to unspent restricted sales taxes to be used for future projects.  The 2010 GO Bond Fund increased its fund balance by $0.26 million due to a reimbursement from ODOT from street project funds paid to ODOT in previous years.      

% Inc. % Inc.Dec. Dec.

2019 2018 2019 2018

Water 10,501$ 10,838$ -3% (224)$ 9$ -2589%Wastewater 2,810 2,468 14% 77 (291) 126%Sanitation 1,474 1,352 9% (182) (99) -84%Stormwater 142 17 735% 232 357 35%Aquarium 5,770 5,142 12% (298) 342 -187%

Total 20,697$ 19,817$ 4% (395)$ 318$ -224%

of Services of Services

TABLE 4Net Revenue (Expense) of Business-Type Activities

(In Thousands)

Net RevenueTotal Expense (Expense)

7

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited 

Budgetary Highlights  General Fund revenues were $0.6 million (or 3.88%) more than final estimates.  General Fund expenses were $0.45 million (or 2.76%) less than final appropriations.   Capital Assets 

At the end of June 30, 2019, the City had a little over $92 million invested in capital assets including police and fire equipment, buildings, water and sewer  lines, roads and park facilities.   That’s an  increase of $8.5 million over the previous year.  

Primary Government Capital Assets(In Thousands)

(Net of accumulated depreciation)

Governmental Business-Type

Activities Activities Total2019 2018 2019 2018 2019 2018

Land 3,009$ 2,456$ 1,738$ 1,738$ 4,747$ 4,194$

Buildings 3,760 2,661 11,275 11,246 15,035 13,907

Roads and bridges 589 - - - 589 -

Other improvements 263 284 96 102 359 386

Machinery and equipment 4,384 2,224 768 662 5,152 2,886 Infrastructure 49,786 35,230 7,023 5,756 56,809 40,986

Exhibits - - 5,763 5,604 5,763 5,604

Construction in progress 3,710 15,014 542 584 4,252 15,598

Totals 65,501$ 57,869$ 27,205$ 25,692$ 92,706$ 83,561$

TABLE 5

  This year’s more significant capital asset additions include:    Main Street Projects        $16,664,000   Fire Trucks                   2,006,000   Skate Park                                  949,000   Frazier Lakes utility infrastructure                         659,000   Yorktown utility infrastructure                                        524,000   Estates at Forest Hills utility infrastructure           483,000   Debt Administration  At the end of June 30, 2019, the City had about $39.1 million in outstanding notes, bonds, capital leases, and accrued compensated absences.  These debts are further detailed below: 

 

8

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited 

 The JPWA acts as guarantor for the outstanding bonds and long term note of the Jenks Aquarium Authority as detailed in the above schedule pertaining to JAA in Business‐Type Activities. 

 More detailed information about the City’s long‐term debt can be found in Note 2. 

  Operations Concerns and Anticipated Actions ‐ City of Jenks 

 

The City has been very conservative in its management practices over a long period of time. The City has contained 

personnel growth and other operational expenses which reflect the realities of its revenue streams. Evidence of such 

undertakings are reflected in higher than average cash reserves and investments for cities of similar circumstances. 

Also, public employee productivity and operational innovation have been maintained at high levels allowing for service 

levels which might be associated with additional increments of funding. In addition, the City has joined with the private 

sector to achieve a high level of housing and industrial development which have contributed to a strong ad valorem 

base, again at a strong relative level of population compared to similar cities of size and circumstance. Finally, within 

this context in calendar 2018, the City received a G.O. Bond Rating of AA+ from Standard & Poor’s Financial Services. 

During the Fall of 2019, the JPWA‘s Utility System Revenue Bonds received a rating of AA from Standard & Poor’s 

Financials Services. 

 

The  expenses  associated with  the  City’s  general  fund  are  primarily  associated with  public  safety  (police  and  fire 

functions). With current  funding sources and  their  current and projected growth,  it  is unlikely  that  the City  could 

sustain additional expenses in this area at any significant level without a significant increase in operating revenue. A 

.55 percent sales and use tax increase on qualifying sales was approved by voters in 2016 in order to help fund a low 

water dam on the Arkansas River, as well as, fund capital improvement projects. However, these funds may not be 

used for operating expenditures. The City’s primary focus is to continue to encourage growth in existing sources of 

public income by expansion of private sector entrepreneurship. 

 

TABLE 6Primary Government Long-Term Debt

(In Thousands)

Governmental Business-TypeActivities Activities Total

2019 2018 2019 2018 2019 2018

Accrued absences 196$ 236$ 157$ 82$ 353$ 318$ Revenue bonds - - 15,915 17,065 15,915 17,065 Notes payable 1,617 586 400 700 2,017 1,286 General obligation bonds 20,795 23,160 - - 20,795 23,160 Capital leases 19 88 2 13 21 101

Totals 22,627$ 24,070$ 16,474$ 17,860$ 39,101$ 41,930$

9

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited 

While the challenge to continue operational capabilities are very real, the City is strategically using its reserves and 

other City Council initiatives to improve its future revenue streams and therefore to continue to provide quality public 

services. Such undertakings include having development pay its “fair share” in new infrastructure costs which may 

include pay back  agreements  to  them or  the City  for  such  expansions;  for developers  to  pay  reasonable  cost  for 

permits associated with public service in construction review of development planning, engineering, and construction 

inspection;  and,  in  cooperation  with  other  taxing  authorities  to  structure  tax  increment  financing  districts  and 

specialized charges and financing where city authorities and funds can be conservatively leveraged to provide overall 

projected improvements to future public revenue streams. Finally, the City has used its G.O. Bond capacity upon voter 

approval  to  leverage  significant  investments  in  infrastructure  improvements  (primarily  in  the  areas  of  street 

construction) with other state and federal funding sources at great benefit to the local taxpayer. 

 

The financial portfolios of the cities of the state of Oklahoma are substandard compared to similar cities in other states 

in  the  nation.  The  City will  continue  to work with  the  State  Legislature  to  strengthen  City  revenues.  Preliminary 

research would appear to indicate that cities and towns in Oklahoma have broad legal authority to “enterprise” other 

areas of municipal operations not currently operated in an enterprise manner. Therefore, the City of Jenks through 

the Jenks Public Works Authority could consider reclassifying additional services for cost recovery as a utility function 

in the future – in the absence of other, additional revenue generating authority from the Legislature, e.g., ad valorem 

taxation authority for operations. Another option for greater operating revenue would be an increase in the current 

city voter authorized sales tax. 

 

Economic Factors and Next Year’s Budget 

 

The Oklahoma and Tulsa metro area economy of which Jenks is a part, has a low unemployment rate compared to the 

nation.   However,  the  state, while  improving  its overall  firm diversification,  is  still heavily  centered  to  the energy 

sector.  Other significant sectors include agriculture, tourism, health, and aerospace.  The City of Jenks is the home to 

a Kimberly‐Clark Manufacturing Facility and two gas fueled power plants. The housing stock is diversified, and the 

community has a higher than average household income.  The community is home to two quality public school districts 

one of which (Jenks Public Schools) has received the prestigious Malcolm Baldrige Award for Public Education.  The 

City is owner (through its Jenks Aquarium Authority) and home to the Oklahoma Aquarium, the only public aquarium 

of its size and quality in the state and region.   

 

While revenue is expected to increase in the short term, due to economic development initiatives it is anticipated that 

related fund balances may diminish in the short term in order to facilitate private sector business investments in the 

community  through municipal  capital  investments.  However,  in  some  cases  the  economic  investment  from  fund 

balances are contingent on a form of payback agreement. Fund balances required by resolutions as contingencies will 

be maintained. 

 

Operations Concerns and Anticipated Actions ‐ Jenks Public Works Authority (JPWA) 

 

The City of Jenks is the beneficiary of the Jenks Public Works Authority (JPWA) which is the utility arm of the City.  

JPWA is responsible for: 

the water distribution system (buying potable water wholesale from the City of Tulsa),  

10

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited 

the wastewater treatment (by contract with private operator),  

the wastewater collection system, the storm water system, the refuse system (by contract with private operator),  

the emergency medical system (by contact with a City of Tulsa trust), and  

the connection to the Tulsa Transit System (by contract).   

 

The JPWA is an anchor to the City and its related entities’ credit worthiness through being the enterprise financial 

vehicle,  not  only  for  itself,  but  as  guarantor  of  the  other  related  entities’  revenue  bonds  and  loans  which  are 

guaranteed by the JPWA revenue stream and its authorizations under the State Constitution and State Statutes.   

 

Historically,  any wholesale  water  increases  by  the  City  of  Tulsa  to  the  JPWA  have  been  passed  through  by  rate 

increases to the Jenks rate payers when these costs have been increased by the wholesale provider.  This has been 

the long‐standing policy practice of the policy bodies to do so.  It is anticipated that the City of Tulsa will hold rates 

steady over the next 2‐3 years. Given that the JPWA does not own its own water supply, rate elasticity is limited.   

 

In comparison, sanitary sewer rates have higher elasticity at this time. The remaining enterprise functions have low 

to  moderate  rate  elasticity.    Because  so  much  of  Jenks  residential  development  is  relatively  recent  (over  three 

decades), the overall infrastructure quality of water and sanitary sewer systems are considered to be above average 

at this time. JPWA initiated facility plan studies and evaluations for the Wastewater Treatment Plant and the Sanitary 

Sewer  collection  system  –  lines  and  lift  stations.  In  December  2019,  JPWA  issued  $14,660,000  in  Utility  System 

Revenue Bonds to fund upgrades to the wastewater treatment plant. As part of this issuance, the outstanding JPWA 

Series 2012 Utility System Revenue Bonds were retired. 

 

Economic Factors and Next Year’s Budget 

 

The primary factors that affect the health of the water enterprise function of the Jenks Public Works Authority are 

rates and the weather.   Rates elasticity is at least partially influenced by overall economic health within the City and 

by the size of any rate increases. As mentioned previously, it is anticipated that the Tulsa Water System wholesale 

supplier will hold its rates to the JPWA in place over the next 2‐3 years.  The JPWA may use this as an opportunity to 

increase their own rates to increase revenue. 

 

It is anticipated that the emergency medical services rate structure will be increased at a low to moderate level to 

reflect the continued subsidy of that function metro wide.  No other adjustments to rate functions within the JPWA 

are known or projected at this time. 

 

Weather impacts on water consumption rates are unpredictable, but past patterns of weather as they relate to water 

customer usage are reviewed annually.  No water rate adjustments relative to weather trends are anticipated at this 

time. Generally, as of 2019, it is estimated that overall rate elasticity for all sources of services is low to moderate. 

 

 

11

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited 

Operations Concerns and Anticipated Actions ‐ Jenks Aquarium Authority (JAA) 

 

The overall revenue for the JAA has increased significantly in the last two fiscal years.  The increase can be attributed 

to the opening of new exhibits (the sea turtle exhibit in 2017 and the Polynesian Reef in 2019), an increased focus on 

membership  sales,  and  emphasizing  opportunities  for  guests  to  purchase  interactive  experiences.    Despite  the 

increase in revenue, it is imperative that costs be contained while at the same time expanding opportunities for new 

experiences for guests coming to the Aquarium and marketing such experiences effectively.   

 

The annual operating subsidy has been trending downward as  revenues have  increased. The City of  Jenks and  its 

related entities continue to provide indirect costs to the JAA operations, primarily in the areas of accounting, legal and 

human resources support.    JAA management has been  identifying additional  revenue opportunities  in addition to 

growth in attendance, catering sales, and special programming sales, to expand revenue streams.  

 

Previous financial contributions by Tulsa County voters toward debt retirement costs provided much needed bridge 

debt financing.  Tulsa County funds for these purposes are no longer available and therefore, debt requirements will 

have to be subsidized by the beneficiary or one of its related entities and/or other sources.  The beneficiary, the City 

of Jenks, acting through City Council has authorized by Resolution, a dedicated revenue source from its related entity, 

the Jenks Public Works Authority, to provide the equivalent debt financing upon the expiration of the county funding.   

 

Finally,  although  the Aquarium’s  long‐term debt  impacts  its  ability  to  reinvest  in  capital  facility maintenance and 

therefore physical replacement and maintenance is an on‐going concern, the refinancing of Jenks Aquarium Authority 

Debt  has  enabled  the Authority  to dedicate  the  savings or  difference  in  the operating budget  for debt  to  facility 

refurbishment and replacement. 

 

 

Economic Outlook 

 

The three core markets for the Oklahoma Aquarium are the Tulsa, Oklahoma metropolitan area, the Oklahoma City 

metropolitan area, and the Springdale/Bentonville, Arkansas metropolitan area.  Other geographic markets include 

South and Southeast Kansas, Southwest Missouri, and North Central Texas.   The Aquarium is attracting significant 

attendance from all these areas, and it is anticipated that these markets offer substantial additional opportunities for 

revenue growth.   

 

The  region enjoys  relatively  low unemployment compared  to  the Nation.    Individual and  family  income growth  is 

expected to continue incremental improvement.  This will translate into slow incremental growth for the Aquarium in 

the absence of dramatic benefits from marketing or other programming efforts.  The Oklahoma Aquarium remains a 

major cultural, recreational, entertainment, and educational point of destination for the Tulsa metropolitan area, the 

state of Oklahoma, and the Northeast Oklahoma multi‐state region.  Greater market penetration should be feasible 

regardless of slow to moderate overall economic growth in these geographic areas.  

 

   

12

MANAGEMENT’S DISCUSSION AND ANALYSIS For the Fiscal Year Ended June 30, 2019 

Unaudited 

Contacting the City’s Financial Management 

 

This financial report is designed to provide our citizens, taxpayers, customers and creditors with a general overview 

of the City’s finances and to show the City’s accountability for the money it receives.  If you have questions about this 

report or need additional  financial  information,  contact  the Finance Director’s Office at  P.O. Box 2007,  Jenks, OK  

74037 or phone at (918) 299‐5883. 

13

City of JenksStatement of Net Position

June 30, 2019

Governmental Activities

Business-type Activities Total

ASSETSCash and cash equivalents 20,259,343$ 18,868,620$ 39,127,963$ Investments 10,322,876 21,961,705 32,284,581 Internal balances 473,358 (473,358) - Interest receivable 69,273 108,932 178,205 Accounts receivable, net of allowance 4,035 1,477,418 1,481,453 Court fine receivable, net of allowance 176,538 - 176,538 Due from other governments 1,501,604 - 1,501,604 Net pension asset 200,557 - 200,557 Capital assets:

Land and construction in progress 6,718,811 2,280,012 8,998,823 Other capital assets, net of depreciation 58,783,731 24,926,007 83,709,738

Total assets 98,510,126 69,149,336 167,659,462

DEFERRED OUTFLOWS OF RESOURCES Deferred amount on refunding - 806,174 806,174

Deferred amount on OPEB 2,561 2,561 5,122 Deferred amounts related to pensions 1,781,489 - 1,781,489

Total deferred outflows 1,784,050 808,735 2,592,785

LIABILITIESAccounts payable 296,666 2,118,607 2,415,273 Accrued payroll liabilities 19,947 11,762 31,709 Accrued interest payable 294,734 254,767 549,501 Due to other governments 87,223 - 87,223 Due to bondholders - 530,200 530,200 Unearned revenue - 234,267 234,267 Long-term liabilities:

Due within one year 2,777,794 1,607,910 4,385,704 Due in more than one year 19,850,461 14,865,434 34,715,895 Total OPEB liability 130,296 130,296 260,592 Net pension liability 4,069,148 - 4,069,148

Total liabilities 27,526,269 19,753,243 47,279,512

DEFERRED INFLOWS OF RESOURCES Deferred amounts related to OPEB 7,495 7,495 14,990 Deferred amounts related to pensions 774,992 - 774,992

Total deferred inflows 782,487 7,495 789,982

NET POSITION

Net investment in capital assets 43,070,682 14,510,576 57,581,258 Restricted for:

Capital projects 7,584,076 - 7,584,076 Debt service 5,863,392 777,434 6,640,826 Streets 914,510 - 914,510 Culture and recreation 459,314 - 459,314 Public safety 1,245,945 - 1,245,945 Other 144,418 - 144,418 Economic development 929,975 - 929,975 Vision projects 2,096,771 - 2,096,771 TIF projects 751,626 - 751,626

Unrestricted 8,924,711 34,909,323 43,834,034 Total net position 71,985,420$ 50,197,333$ 122,182,753$

14

City of Jenks

Statement of ActivitiesFor the Year Ended June 30, 2019

Functions/Programs Expenses

Indirect Expense

AllocationCharges for

Services

Operating Grants and

Contributions

Capital Grants and

ContributionsGovernmental

ActivitiesBusiness-type

Activities TotalPrimary government

Governmental activities:General government 1,517,014$ -$ 370,332$ 13,000$ -$ (1,133,682)$ -$ (1,133,682)$ Public safety 6,284,119 - 356,888 527,017 - (5,400,214) - (5,400,214) Streets 3,089,368 - 32,751 201,604 5,365,620 2,510,607 - 2,510,607 Economic development 1,158,142 - - - - (1,158,142) (1,158,142) Culture and recreation 473,903 - 47,928 - 958,913 532,938 - 532,938 Interest on long-term debt 903,886 - - - - (903,886) - (903,886)

Total governmental activities 13,426,432 - 807,899 741,621 6,324,533 (5,552,379) - (5,552,379)

Business-type activitiesWater 8,031,362 2,469,412 9,877,027 - 400,219 - (223,528) (223,528) Wastewater 2,319,685 490,127 1,960,384 - 926,207 - 76,779 76,779 Sanitation 1,150,617 322,929 1,291,633 - - - (181,913) (181,913) Stormwater 142,358 - - - 374,551 - 232,193 232,193 Aquarium 5,769,590 - 5,243,802 54,553 173,330 - (297,905) (297,905) General Operations 3,282,468 (3,282,468) - - - - - -

Total business-type activities 20,696,080 - 18,372,846 54,553 1,874,307 - (394,374) (394,374) Total primary government 34,122,512$ -$ 19,180,745$ 796,174$ 8,198,840$ (5,552,379) (394,374) (5,946,753)

General revenues:Taxes:

Sales and use taxes 8,925,711 - 8,925,711 Property taxes 3,014,053 - 3,014,053 Franchise and public service taxes 1,049,909 - 1,049,909 Hotel/motel taxes 58,379 - 58,379 Tax apportionment revenue 1,344,240 - 1,344,240 E-911 taxes 226,791 - 226,791

Intergovernmental revenue not restricted to specific programs 262,624 - 262,624 Investment income 591,872 942,874 1,534,746 Miscellaneous 423,197 735,056 1,158,253

Transfers - Internal activity 1,455,415 (1,455,415) - Total general revenues and transfers 17,352,191 222,515 17,574,706

Change in net position 11,799,812 (171,859) 11,627,953 Net position - beginning 60,185,608 50,369,192 110,554,800 Net position - ending 71,985,420$ 50,197,333$ 122,182,753$

See accompanying notes to the basic financial statements.

Program RevenueNet (Expense) Revenue and Changes in Net Position

Primary Government

15

City of JenksBalance Sheet

Governmental FundsJune 30, 2019

General Fund Sinking Fund

Fire Suppression

Vehicles

Other Governmental

Funds

Total Governmental

FundsASSETSCash and cash equivalents 7,796,066$ 2,558,410$ 213,125$ 9,865,046$ 20,432,647$ Investments 5,450,387 - - 4,699,185 10,149,572 Accrued interest receivable 30,767 - - 38,506 69,273 Due from other funds 261,665 15,918 - 359,736 637,319 Due from other governments 1,241,062 176,865 - 83,677 1,501,604 Accounts receivable 4,035 - - - 4,035 Court fines receivable, net 176,538 - - - 176,538

Total assets 14,960,520$ 2,751,193$ 213,125$ 15,046,150$ 32,970,988$

LIABILITIES, DEFERRED INFLOWS AND FUND BALANCESLiabilities:

Accounts payable 216,915$ -$ 33,985$ 65,713$ 316,613$ Accrued interest payable - 286,919 - - 286,919 Due to other funds 13,961 - - 150,000 163,961 Due to other governments 87,223 - - - 87,223

Total liabilities 318,099 286,919 33,985 215,713 854,716

Deferred Inflow of Resources:Unavailable revenue 173,086 136,010 - 61,724 370,820

Fund balances:Restricted 3,485,454 2,249,743 - 14,102,618 19,837,815 Assigned 4,540,599 78,521 179,140 675,290 5,473,550 Unassigned (deficit) 6,443,282 - . (9,195) 6,434,087

Total fund balances 14,469,335 2,328,264 179,140 14,768,713 31,745,452 Total liabilities, deferred inflows and fund balances 14,960,520$ 2,751,193$ 213,125$ 15,046,150$ 32,970,988$

See accompanying notes to the basic financial statements.

16

City of JenksReconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position

June 30, 2019

Fund Balance - Net Position Reconciliation: 31,745,452$

Amounts reported for governmental activities in the Statement of Net Position are different because:

Capital assets used in governmental activities are not current financial resources and therefore are not reported in the funds, net of accumulated depreciation of $17,973,146 65,502,542

Other long-term assets and deferrals are not available to pay for current period expenditures and therefore are deferred or not reported in the funds:

OPEB deferred outflows 2,561Pension related deferred outflows of resources 1,781,489

Unavailable revenue 370,820Net pension asset 200,557

2,355,427

Certain long-term liabilities are not due and payable from current financial resources and therefore they, along with certain deferred inflows, are not reported in the funds: Accrued interest payable (7,815) Capital lease obligation (19,437) Notes payable (1,617,423) General obligation bond (20,795,000) Net pension liability (4,069,148)

Pension related deferred inflows of resources (774,992) Total OPEB liability (130,296)

OPEB related deferred inflows of resources (7,495) Accrued compensated absences (196,395)

(27,618,001)

Net Position of Governmental Activities in the Statement of Net Position 71,985,420$

See accompanying notes to the basic financial statements.

17

City of JenksStatement of Revenues, Expenditures and Changes in Fund Balances

Governmental FundsFor the Year Ended June 30, 2019

General Fund Sinking Fund

Fire Suppression

Vehicles

Other Governmental

Funds

Total Governmental

Funds REVENUESTaxes 10,107,923$ 3,044,916$ -$ 1,629,410$ 14,782,249$ Intergovernmental 585,740 - - 424,448 1,010,188 Charges for services 66,568 - - 32,751 99,319 Fines and forfeitures 344,107 - - - 344,107 Licenses and permits 289,502 - - 47,928 337,430 Investment income 261,843 41,627 4,140 253,668 561,278 Miscellaneous 121,962 - - 124,632 246,594

Total revenues 11,777,645 3,086,543 4,140 2,512,837 17,381,165

EXPENDITURESCurrent:

General government 1,082,146 2,100 - 251,498 1,335,744 Public safety 5,550,487 - - 338,782 5,889,269 Public service 827,383 - - 688,835 1,516,218 Streets - - - 45,329 45,329 Culture and recreation 359,923 - - 59,949 419,872

Capital Outlay 6,504 - 2,391,347 780,200 3,178,051 Debt Service: Principal - 2,365,000 207,652 194,467 2,767,119 Interest - 853,920 37,380 10,333 901,633

Total expenditures 7,826,443 3,221,020 2,636,379 2,369,393 16,053,235 Excess (deficiency) of revenues over expenditures 3,951,202 (134,477) (2,632,239) 143,444 1,327,930

OTHER FINANCING SOURCES (USES)Transfers in 5,500,299 - 865,100 1,798,953 8,164,352 Transfers out (8,927,384) - - - (8,927,384) Proceeds from long-term debt - - 1,494,776 - 1,494,776

Total other financing sources (uses) (3,427,085) - 2,359,876 1,798,953 731,744

Net change in fund balances 524,117 (134,477) (272,363) 1,942,397 2,059,674 Fund balances - beginning 13,945,218 2,462,741 451,503 12,826,316 29,685,778 Fund balances - ending 14,469,335$ 2,328,264$ 179,140$ 14,768,713$ 31,745,452$

See accompanying notes to the basic financial statements.

18

City of Jenks

Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of ActivitiesFor the Year Ended June 30, 2019

Changes in Fund Balance - Changes in Net Position Reconciliation: 2,059,674$

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

Governmental funds report outlays for capital assets as expenditures while governmental activities report depreciation and amortization expense to allocate those expenditures over the life of the assets:

Capital asset purchases capitalized 11,320,735 Book value of disposed capital assets (207,430) Depreciation expense (3,479,237)

7,634,068

Revenues in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds:

Change in unavailable revenue 12,746

In the Statement of Activities, the net cost of pension benefits earned is calculated and reported as pension expense. The fund financial statements report pension contributions as pension expenditures. This amount represents the difference between pension contributions and calculated pension expense. 661,144

Debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the Statement of Net Position. Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the Statement of Net Position:

Principal payment on capital lease obligation 69,247 Principal payment on G.O. bonds payable 2,365,000 Principal payment on notes payable 463,357 Proceeds from notes payable (1,494,776)

1,402,828

Some expenses reported in the Statement of Activities do not require the use of current financial resources and these are not reported as expenditures in governmental funds:

Change in accrued interest payable 2,475 Change in total OPEB liability and related deferrals (12,352) Change in accrued compensated absences 39,229

29,352

Change in net position of governmental activities 11,799,812$

See accompanying notes to the basic financial statements.

19

City of JenksStatement of Net Position

Proprietary FundsJune 30, 2019

Public Works Authority

Aquarium Authority

Industrial Authority

(Major) (Major) (Nonmajor) TotalASSETSCurrent assets:

Cash and cash equivalents 13,703,242$ 3,295,676$ 559$ 16,999,477$ Restricted cash and cash equivalents 99,341 983,195 - 1,082,536 Investments 19,231,333 2,730,372 - 21,961,705 Interest receivable 94,274 14,658 - 108,932 Accounts receivable, net 1,395,037 82,381 - 1,477,418 Due from other funds 498,039 - - 498,039

Total current assets 35,021,266 7,106,282 559 42,128,107 Non-current assets:

Restricted cash and cash equivalents 477,180 309,427 - 786,607 Capital assets:

Land and other non-depreciable assets 2,193,527 86,485 - 2,280,012 Other capital assets, net of depreciation 10,784,988 13,815,970 325,049 24,926,007

Total non-current assets 13,455,695 14,211,882 325,049 27,992,626 Total assets 48,476,961 21,318,164 325,608 70,120,733

DEFERRED OUTFLOWS OF RESOURCES Deferred outflows related to OPEB 1,086 1,475 - 2,561 Deferred amount on refunding - 806,174 - 806,174

Total deferred outflows 1,086 807,649 - 808,735

LIABILITIESCurrent liabilities:

Accounts payable 1,681,353 371,260 - 2,052,613 Accrued payroll liabilities 6,764 70,992 - 77,756 Due to other funds 629,555 341,842 - 971,397 Accrued interest payable 2,763 252,004 - 254,767 Unearned revenue - 234,267 - 234,267 Current portion of:

Due to depositors 53,020 - - 53,020 Notes payable - 400,000 - 400,000 Capital lease obligation payable 1,552 - - 1,552 Revenue bonds payable 470,000 705,000 - 1,175,000 Accrued compensated absences 14,066 17,292 - 31,358

Total current liabilities 2,859,073 2,392,657 - 5,251,730 Non-current liabilities:

Due to depositors 477,180 - - 477,180 Notes payable - - - - Total OPEB liability 55,277 75,019 - 130,296 Revenue bonds payable, net 970,000 13,770,000 - 14,740,000 Accrued compensated absences 56,266 69,168 - 125,434

Total non-current liabilities 1,558,723 13,914,187 - 15,472,910 Total liabilities 4,417,796 16,306,844 - 20,724,640

DEFERRED INFLOWS OF RESOURCES Deferred inflows related to OPEB 3,180 4,315 - 7,495

NET POSITIONNet investment in capital assets 11,536,963 2,648,564 325,049 14,510,576 Restricted for debt service 43,558 733,876 - 777,434 Unrestricted 32,476,550 2,432,214 559 34,909,323

Total net position 44,057,071$ 5,814,654$ 325,608$ 50,197,333$

See accompanying notes to the basic financial statements.

Enterprise Funds

20

City of JenksStatement of Revenues, Expenses and Changes in Fund Net Position

Proprietary FundsFor the Year Ended June 30, 2019

Public Works Authority

Aquarium Authority

Industrial Authority

(Major) (Major) (Nonmajor) Total

REVENUES

Water charges 9,861,427$ -$ -$ 9,861,427$ Sewer charges 1,894,794 - - 1,894,794 Sanitation 1,291,633 - - 1,291,633 Licenses and permits 81,190 - - 81,190 Aquarium charges: Fees - 4,207,664 - 4,207,664 Catering - 314,761 314,761 Gift shop - 223,164 - 223,164 Other charges - 498,213 - 498,213 Miscellaneous 594,330 75,069 - 669,399

Total operating revenues 13,723,374 5,318,871 - 19,042,245

OPERATING EXPENSESGeneral and administrative 2,352,836 - - 2,352,836 Economic development 626,590 - - 626,590 Cultural and recreational 53,651 - - 53,651 Water service 7,789,750 - - 7,789,750 Sewer service 1,715,243 - - 1,715,243 Solid waste service 1,150,617 - - 1,150,617 Stormwater drainage 321,981 - - 321,981 Aquarum operations - 4,343,108 - 4,343,108 Depreciation expense 856,041 837,380 17,218 1,710,639

Total operating expenses 14,866,709 5,180,488 17,218 20,064,415 Operating income (loss) (1,143,335) 138,383 (17,218) (1,022,170)

NON-OPERATING REVENUES (EXPENSES)Investment income 792,647 150,227 - 942,874 Miscellaneous 122,619 - - 122,619 Transfer capital assets to governmental activities (2,265,499) - (2,265,499) Interest expense and fiscal charges (44,488) (589,586) - (634,074)

Total non-operating revenue (expenses) (1,394,721) (439,359) - (1,834,080)

Income (loss) before contributions and transfers (2,538,056) (300,976) (17,218) (2,856,250)

Capital contributions 1,748,029 173,330 - 1,921,359 Transfers in 7,522,431 75,000 - 7,597,431 Transfers out (6,834,399) - - (6,834,399)

Change in net position (101,995) (52,646) (17,218) (171,859) Total net position - beginning 44,159,066 5,867,300 342,826 50,369,192 Total net position - ending 44,057,071$ 5,814,654$ 325,608$ 50,197,333$

See accompanying notes to the basic financial statements.

Enterprise Funds

21

City of JenksStatement of Cash Flows

Proprietary FundsFor the Year Ended June 30, 2019

Public Works Aquarium Industrial TotalAuthority Authority Authority Enterprise(Major) (Major) (Nonmajor) Funds

CASH FLOWS FROM OPERATING ACTIVITIESReceipts from customers 14,432,903$ 5,250,851$ - $ 19,683,754$ Payments to suppliers (11,103,566) (1,875,930) - (12,979,496) Payments to employees (2,517,959) (2,097,226) - (4,615,185) Receipts of customer meter deposits 102,227 - - 102,227 Refunds of customer meter deposits (94,230) - - (94,230) Interfund receipts/payments 2,580 - - 2,580 Net cash provided by operating activities 821,955 1,277,695 - 2,099,650

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIESTransfers from other funds 7,522,431 75,000 - 7,597,431 Transfers to other funds (6,834,399) - - (6,834,399) Net cash provided by noncapital financing activities 688,032 75,000 - 763,032

CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIESPurchases of capital assets (2,840,590) (857,300) - (3,697,890) Capital contributions - 128,681 - 128,681 Principal paid on capital debt (471,383) (990,000) - (1,461,383) Interest and fiscal agent fees paid on capital debt (45,197) (550,383) - (595,580) Net cash provided by (used in) capital and related financing activities (3,357,170) (2,269,002) - (5,626,172)

CASH FLOWS FROM INVESTING ACTIVITIESSale of investments 2,842,052 507,350 - 3,349,402 Interest and dividends 770,942 158,500 - 929,442 Net cash provided by investing activities 3,612,994 665,850 - 4,278,844

Net increase (decrease) in cash and cash equivalents 1,765,811 (250,457) - 1,515,354

Balances - beginning of year 12,513,952 4,838,755 559 17,353,266

Balances - end of year 14,279,763$ 4,588,298$ 559$ 18,868,620$

Reconciliation to Statement of Net Position: Cash and cash equivalents 13,703,242$ 3,295,676$ 559$ 16,999,477$ Restricted cash and cash equivalents - current 99,341 983,195 - 1,082,536 Restricted cash and cash equivalents - noncurrent 477,180 309,427 - 786,607

Total cash and cash equivalents, end of year 14,279,763$ 4,588,298$ 559$ 18,868,620$

See accompanying notes to the financial statements.

Enterprise Funds

22

City of JenksStatement of Cash Flows

Proprietary FundsFor the Year Ended June 30, 2019

Public Works Aquarium Industrial Total

Authority Authority Authority Enterprise

(Major) (Major) (Nonmajor) Funds

Reconciliation of operating income (loss) to net cash provided by operating activities: Operating income (loss) (1,143,335)$ 138,383$ (17,218)$ (1,022,170)$ Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation expense 856,041 837,380 17,218 1,710,639 Miscellaneous income 122,619 - - 122,619 Change in assets and liabilities: Due from other funds 2,580 - - 2,580 Accounts receivable 586,910 (69,527) - 517,383

Total OPEB liability 6,710 9,106 - 15,816 OPEB deferred inflows (382) (520) - (902) OPEB deferred outflows (1,086) (1,475) - (2,561)

Accounts payable 348,108 255,559 - 603,667 Accrued payroll payable 820 67,809 - 68,629 Unearned revenue - 1,507 - 1,507 Deposits subject to refund 7,997 - - 7,997 Accrued compensated absences 34,973 39,473 - 74,446

Net cash provided by operating activities 821,955$ 1,277,695$ -$ 2,099,650$

Noncash activities: Contributed capital assets 1,748,029$ 44,649$ -$ 1,792,678$ Capital assets transferred to governmental activities (2,265,499) - - (2,265,499)

See accompanying notes to the basic financial statements.

Enterprise Funds

23

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The City of Jenks, Oklahoma (the “City”) complies with accounting principles generally accepted in the United States of America (GAAP) as applicable to governmental units. The Governmental Accounting Standards Board (GASB) is responsible for establishing GAAP for state and local governments through its pronouncements (Statements and Interpretations). The more significant accounting policies established in GAAP and used by the City are discussed below. During the fiscal year, the City implemented the following GASB Pronouncements: Statement No. 88, Certain Disclosures Related to Debt including Direct Borrowings and Direct Placements – GASB 88 improves the information that is disclosed in notes to government financial statements related to debt, including direct borrowings and private placement debt. See Note 2.G. Statement No. 83, Certain Asset Retirement Obligations – GASB 83 addresses accounting and financial reporting for certain asset retirement obligations. See Note 3.C.

A. Reporting Entity

The City’s financial reporting entity is comprised of the following:

Primary Government: City of Jenks Component Units: Jenks Public Works Authority Jenks Aquarium Authority Jenks Industrial Authority

In determining the financial reporting entity, the City complies with the provisions of GASB No. 14, The Financial Reporting Entity, and GASB Statement No. 61, The Financial Reporting Entity: Omnibus, an amendment of GASB Statements No. 14 and No. 34, and includes all component units of which the City is fiscally accountable.

The component units listed above are Public Trusts established pursuant to Title 60 of Oklahoma State law. A Public Trust (Authority) has no taxing power. The Authority is generally created to finance City services through issuance of revenue bonds or other non-general obligation debt and to enable the City Council to delegate certain functions to the governing body (Trustees) of the Authority. The Authority generally retains title to assets which are acquired or constructed with Authority debt or other Authority generated resources. In addition, the City has leased certain existing assets at the creation of the Authority to the Trustees on a long-term basis. The City, as beneficiary of the Public Trust, receives title to any residual assets when a Public Trust is dissolved.

Blended Component Units/Trusts:

The Jenks Public Works Authority (JPWA) was created pursuant to a Trust Indenture, for the benefit of the City of Jenks, Oklahoma. JPWA was established to acquire, construct, develop, equip, operate, maintain, repair, enlarge and remodel water and sanitary sewer facilities for the City of Jenks. The water, sanitary sewer and solid waste disposal systems owned by the City have been leased to JPWA until such date that all indebtedness of the Authority is retired or provided for. JPWA is a public trust and an agency of the State of Oklahoma under Title 60, Oklahoma Statutes 1991, Section 176, et seq., and is governed by a board consisting of seven trustees identical with the City Council. JPWA is exempt from State and Federal Income taxes. Any issuances of debt by the JPWA requires a 2/3rd approval of the City Council. The management of the City and the Trust is the same. JPWA is reported as an enterprise fund.

24

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

A. Reporting Entity (Continued)

The Jenks Aquarium Authority (JAA) is a public trust created under and pursuant to the provisions of Title 60, Oklahoma Statutes 1991, Section 176, et seq., for the use and benefit of the City of Jenks, Oklahoma. The JAA was created to finance, develop and operate the Oklahoma Aquarium. Four City Council members and three members of the Oklahoma Aquarium Foundation serve as the governing body (Trustees). JAA is exempt from State and Federal Income taxes. Any issuances of debt by the JAA requires a 2/3rd approval of the City Council. The management of the City and the Trust is the same. JAA is reported as an enterprise fund. The Jenks Industrial Authority (JIA) is a public trust created under and pursuant to the provisions of Title 60, Oklahoma Statutes 1991, Section 176, et seq., for the use and benefit of the City of Jenks, Oklahoma. JIA was created to promote the development of industry and to provide additional employment in the Jenks, Oklahoma area. JIA is governed by a board consisting of seven trustees identical with the City Council. JIA is exempt from State and Federal Income taxes. Any issuances of debt by the JIA requires a 2/3rd approval of the City Council. The management of the City and the Trust is the same. JIA is reported as an enterprise fund.

B. 1. Basis of Presentation Government-Wide Financial Statements:

The statement of net position and statement of activities display information about the City as a whole including component units. They include all financial activities of the reporting entity. Eliminations have been made to minimize the double reporting of transactions involving internal activities. Individual funds are not displayed in these statements. Instead, the statements distinguish between governmental and business-type activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other non-exchange revenues. Business-type activities are financed in whole or in part by fees charged to external parties for goods or services. The statement of activities presents a comparison between the expenses and program revenues directly associated with the different governmental functions and business-type activities to arrive at the net revenue or expense of the function or activity prior to the use of taxes and other general revenues. Program revenues include (1) fees, fines, and service charges generated by the program or activity, (2) operating grants and contributions that are restricted to meeting the operational requirements of the program or activity, and (3) capital grants and contributions that are restricted to meeting the capital requirements of the program or activity. Fund Financial Statements: Fund financial statements of the reporting entity are organized into funds, each of which is considered to be separate accounting entities. Each fund is accounted for by providing a separate set of self-balancing accounts which constitute its assets, deferred inflows of resources, liabilities, deferred outflows of resources, or fund equity, revenues, and expenditures/expenses. Funds are organized into two major categories: governmental and proprietary. The City presently has no fiduciary funds. An emphasis is placed on major funds within the governmental and proprietary categories. A fund is considered major if it is the primary operating fund of the City or meets the following criteria: a. Total assets plus deferred outflows of resources, liabilities plus deferred inflows of resources,

revenues or expenditures/expenses of that individual governmental or enterprise fund are at least 10 percent of the corresponding total for all funds of that category or type, and

25

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

B. 1. Basis of Presentation (Continued)

b. Total assets plus deferred outflows of resources, liabilities plus deferred inflows of resources, revenues or expenditures/expenses of the individual governmental fund or enterprise fund are at least 5 percent of the corresponding total for all governmental and enterprise funds combined.

c. A fund that does not meet the criteria of (a) and (b), but for which management has determined is of such significance to be reported as a major fund.

All remaining governmental and enterprise funds not meeting the above criteria are aggregated and reported as nonmajor funds. The funds of the financial reporting entity are described below:

The following are the City’s major governmental funds:

General Fund – is the general operating fund of the City. It accounts and reports for all financial resources not required to be reported in another fund. It also includes the following accounts that do not meet the qualifications to be reported as another governmental fund type:

Riverwalk Improvement District – remaining balance represents leftover funds from the Riverwalk Improvement District project whereby expenses were paid from another fund and reimbursements were received from the Muscogee (Creek) Nation Riverwalk for development expenses and related debt service payments and administration fees. Economic Development – accounts for a $3 million court-assessed judgment with Green Country for a lease permit fee and yearly transfers assigned to economic development expenses. City Risk Management – accounts for insurance reimbursements and transfers assigned for risk management expenses. Municipal Court – accounts for fines, bonds, and other assets held for distribution to the General Fund and others.

Sinking Fund – a debt service fund that accounts for and reports ad valorem taxes levied by the City for use in retiring court-assessed judgments and general obligation bonds and their related interest expense. Fire Suppression Fund - a capital project fund used to account for purchase of fire vehicles and related debt service funded with transfers from One Cent Capital Fund

Other governmental funds of the City that are considered non-major funds include:

Special Revenue Funds – account for specific revenue sources that are restricted or committed to expenditures for specific purposes. The following are the City’s Special Revenue Funds: Street and Alley – Accounts for revenues received from gasoline excise tax, motor vehicle tax and expenditures made for street maintenance and operations. Police Seizure - Accounts for revenues received from drug seizures. All monies and property received must be used for law enforcement purposes only. Park Recreation Funds – Accounts for fees on new residents to be used for parks and recreation expenses in accordance with enabling legislation in Article 4, Section 15-4-1 of the City Code.

26

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

B. 1. Basis of Presentation (Continued)

Senior Citizens – Accounts for donations and fund raising revenues to be used for the benefit of senior citizens. Home Rebate – Accounts for $200 of residential development recreation fee and $300 of plant development fee revenue to be used to provide $500 home rebates to qualifying first resident home-buyers. This program ceased in 1994. Any remaining funds should be paid to the Parks Recreation Fund (40%) and the JPWA Wastewater Treatment Plant Fund (60%). Skyline Improvement – Accounts for revenues received from development fees assessed to property owners to be used to reimburse the city for its costs to connect utilities for those property owners. Economic Development Accommodation – Accounts for 87.5% of accommodation tax to be used for economic development. Vision Sales Tax – Accounts for a .55 cents sales taxes approved by the voters as outlined in Ordinance No. 1392, in effect for 15 years from January 1, 2017. The funds are to be used for specific capital projects to include Jenks/Tulsa Arkansas River Low Water Dam Project, constructing roads and road maintenance, park improvements and construction, sidewalks and trails, upgrades to stormwater and sewer infrastructure. TIF District #3 – Accounts for tax increment revenues to be used for TIF projects within District #3 TIF District #4 – Accounts for tax increment revenues to be used for TIF projects within District #4 E-911 - Accounts for revenues received from tariff rates on base line telephone charges and expenditures for operations and maintenance of the E-911 system. Public Parking Assessment - Accounts for parking garage maintenance fees to be used for electric and janitorial expenses for a parking garage and routine maintenance of other public facilities located within Village on Main, in accordance with a certain parking garage agreement. TIF District #1 – Accounts for tax increment revenues to be used for TIF projects within District #1 Police General Receipts – Accounts for donations and juvenile fine revenue to be used for juveniles expenses in accordance with an agreement with Oklahoma District Court in Tulsa County, TIF District #2 – Accounts for tax increment revenues to be used for TIF projects within District #2. Capital Projects Funds – which accounts for and reports resources that are restricted, committed, or assigned to expenditure for the acquisition or construction of major capital facilities, other than those activities financed by proprietary activities or held in trust for individuals, private organizations or other governments. Capital Project Funds of the City include: 1978 Sanitary Sewer, 2002 GO Bond, 1991 GO Bond, 1998 Roadway Improvement, 2014 GO Bond, CDBG Fund, 2010 GO Bond, Radio Communications, 2006 GO Bond, and Uniformed Patrol Vehicles.

27

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

B. 1. Basis of Presentation (Continued)

PROPRIETARY FUNDS Proprietary funds include enterprise funds. Enterprise funds are used to account for business-like activities provided to the general public. Internal service funds are used to account for business-like activities provided and charged to other funds or entities within the reporting entity. These activities are financed primarily by user charges and the measurement of financial activity focuses on net income measurement similar to the private sector. The reporting entity includes the following enterprise funds:

Jenks Public Works Authority (major fund) – accounts for the operations of providing public works (water, sewer and sanitation) to the City. Jenks Aquarium Authority (major fund) – accounts for the operations of the Oklahoma Aquarium. Jenks Industrial Authority (non-major fund) – accounts for promotion of the development of industry and provides additional employment in the Jenks, Oklahoma area.

B. 2. Measurement Focus and Basis of Accounting

Measurement focus is a term used to describe how transactions are recorded within the financial statements. Basis of accounting refers to when transactions are recorded regardless of the measurement focus applied.

Measurement Focus Government-wide and Proprietary Fund Financial Statements In the government-wide Statement of Net Position and the Statement of Activities, and the proprietary fund statements, the “economic resources” measurement focus is applied. The accounting objectives of this measurement focus are the determination of operating income, changes in net position (or cost recovery), financial position and cash flows. All assets, deferred outflows of resources, liabilities, and deferred inflows of resources (whether current or noncurrent, financial or nonfinancial) associated with their activities are reported. Fund equity is classified as net position. Governmental Fund Financial Statements In the governmental fund financial statements, a “current financial resources” measurement focus is applied. Under this focus, only current financial assets, deferred outflows of resources, liabilities, and deferred inflows of resources are generally included on their balance sheets. Their operating statements present sources and uses of available spendable financial resources during a given period. These funds use fund balance as their measure of available spendable financial resources at the end of the period. Basis of Accounting Government-wide and Proprietary Fund Financial Statements In the government-wide Statement of Net Position and Statement of Activities, and the proprietary fund financial statements, the accrual basis of accounting is applied. Under the accrual basis of accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred or economic asset used. Revenues, expenses, gains, losses, assets, deferred outflows of resources, liabilities and deferred inflows of resources resulting from exchange and exchange-like transactions are recognized when the exchange takes place.

28

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

B. 2. Measurement Focus and Basis of Accounting (Continued) Governmental Fund Financial Statements In the governmental fund financial statements, the modified accrual basis of accounting is applied. Under this modified accrual basis of accounting, revenues are recognized when “measurable and available”. Measurable means knowing or being able to reasonably estimate the amount. Available means collectible within the current period or soon enough thereafter to pay current liabilities. The City has defined “available” as collected within 60 days after year end. Sales and use taxes, franchise taxes, hotel/motel taxes, court fines and interest are considered susceptible to accrual. Expenditures (including capital outlay) are recorded when the related fund liability is incurred, except for general long-term debt principal and interest, claims and judgments, and accrued compensated absences, which are recorded as expenditures to the extent they have matured. Proceeds of general long-term debt, bond premiums, and capital leases are reported as other financial sources.

C. Assets, Deferred Outflows, Liabilities, Deferred Inflows and Equity

1. Deposits and Investments

Oklahoma Statutes authorize the City to invest in certificates of deposit, repurchase agreements, passbooks, bankers' acceptances, and other available bank investments provided that all deposits are fully covered by approved securities pledged to secure those funds. In addition, the City can invest in direct debt securities of the United States unless law expressly prohibits such an investment.

For financial statement presentation and for purposes of the statement of cash flows, the City’s cash and cash equivalents are considered to be cash on hand, demand deposits and certificates of deposit with original maturity date of three months or less. Debt instruments with a maturity date of more than three months from date of purchase are considered to be investments. Investments are stated at fair value.

2. Restricted Cash and Investments

The restricted bond fund cash and investments are the result of financial requirements of bond issues and consist of funds held in Bond Fund Reserve Accounts, Bond Fund Principal Accounts, Bond Fund Interest Accounts, Construction Accounts, and Sales Tax Revenue Accounts. Under the terms and provisions of the Bond Indenture, these special accounts and reserve funds are maintained with the Trustee bank for the benefit of the holders of the bonds and are not subject to lien or attachment by any other creditors. These accounts and reserve funds are to be maintained so long as any bonds are outstanding. Monies contained in the accounts and reserve funds held by the Trustee are required to be continuously invested in authorized securities that mature not later than the respective dates when the funds shall be required for the purpose intended by the trust indenture.

3. Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

29

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

C. Assets, Deferred Outflows, Liabilities, Deferred Inflows and Equity (Continued)

4. Internal and Interfund Balances and Activities

In the process of aggregating the financial information for the government-wide financial statements, some amounts reported as interfund activity and balances in the fund financial statements have been eliminated or reclassified.

Government-Wide Financial Statements: Interfund activity and balances, if any, are eliminated or reclassified in the government-wide financial statements as follows: Internal balances - amounts reported in the fund financial statements as interfund receivables and payables are eliminated in the governmental and business-type activities columns of the statement of net position, except for the net residual amounts due between governmental and business-type activities, which are reported as Internal Balances.

Internal activities - amounts reported as interfund transfers in the fund financial statements are

eliminated in the government-wide statement of activities except for the net amount of transfers between governmental and business-type activities, which are reported as Transfers - Internal Activities. The effect of interfund services between funds are not eliminated in the statement of activities.

Fund Financial Statements:

Interfund activity, if any, within and among the governmental and proprietary fund categories is reported as follows in the fund financial statements:

1. Interfund loans - amounts provided with a requirement for repayment are reported as interfund receivables and payables.

2. Interfund services - sales or purchases of goods and services between funds are reported

as revenues and expenditures/expenses. 3. Interfund reimbursements - repayments from funds responsible for certain

expenditures/expenses to the funds that initially paid for them are not reported as reimbursements but as adjustments to expenditures/expenses in the respective funds.

4. Interfund transfers - flow of assets from one fund to another where repayment is not

expected are reported as transfers in and out. 5. Receivables

Material receivables in governmental funds and governmental activities include revenue accruals such as sales tax, franchise tax, grants, property tax, and police fines since they are usually both measurable and available. Property tax and police fines are reported net of allowances for uncollectible accounts. Revenue from non-exchange transactions collectible but not available are deferred in accordance with GASB Statement 33 at the fund level.

30

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

C. Assets, Deferred Outflows, Liabilities, Deferred Inflows and Equity (Continued)

5. Receivables, (Continued) Proprietary funds and business-type activities material receivables consist of all revenues earned at year-end and not yet received. Billed and unbilled utility accounts receivable comprise the majority of these receivables. They are reported net of allowances for uncollectible accounts.

6. Inventories

Inventories in both governmental funds and proprietary funds normally consist of minimal amounts of expendable supplies held for consumption. The costs of such inventories are recorded as expenditures when purchased rather than when consumed.

7. Capital Assets

General capital assets are those assets not specifically related to activities reported in the proprietary funds. These assets generally result from expenditures in the governmental funds. These assets are reported in the governmental activities column of the government-wide statement of net position but are not reported in the fund financial statements. Capital assets utilized by the proprietary funds are reported in the business-type activities column of the government-wide statement of net position and in the respective funds. All capital assets are capitalized at cost (or estimated historical cost) and updated for additions and retirements during the year. Donated capital assets are recorded at their fair value as of the date received. The City maintains a capitalization threshold of $5,000 for the governmental and proprietary funds.

The City’s infrastructure consists of roads, bridges, culverts, curbs and gutter, streets and sidewalks, drainage system, lighting systems and similar assets that are immovable and of value only to the City. Such infrastructure assets acquired are capitalized in accordance with the requirements of GASB 34. Improvements are capitalized; the costs of normal maintenance and repairs that do not add value to the asset or materially extend an asset’s life are not capitalized. Major outlays for capital assets and improvements are capitalized in proprietary funds as projects are constructed. All reported capital assets are depreciated except for land and construction in progress. Improvements are depreciated over the remaining useful lives of the related capital assets. Useful lives for infrastructure were estimated based on the City’s historical records of necessary improvements and replacement. Depreciation is computed using the straight-line method over the following estimated useful lives:

DescriptionBuildings 10 - 40 years 10 - 40 yearsOther improvements 5 - 40 years 5 - 40 yearsEquipment and vehicles 3 - 30 years 3 - 30 yearsInfrastructure 5 - 50 years 5 - 50 years

GovernmentalActivities

Estimated Lives

Business-TypeActivities

Estimated Lives

31

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

C. Assets, Deferred Outflows, Liabilities, Deferred Inflows and Equity (Continued) 8. Compensated Absences

Employees are granted vacation and sick leave based upon length of employment. In the event of termination, the employee is paid for accumulated vacation leave. Payment of sick leave is restricted to those with more than 60 days of accumulated benefits and is limited to a maximum of $500. Vacation and sick leave is recorded when incurred and sick leave is recorded when vested. The expense and related liability for vested vacation benefits and sick leave is recorded in the respective funds of the City or component unit. The liability is computed based on pay rates in effect as of June 30, 2019.

9. Deferred Outflow/Inflow of Resources

In addition to assets and liabilities, the statement of financial position reports a separate section for deferred outflows of resources and deferred inflows of resources. Deferred outflows of resources represent a consumption of net position that applies to a future period which will not be recognized as an outflow of resources until that time. Deferred inflows of resources represent an acquisition of net position that applies to a future period which will not be recognized as an inflow of resources until that time.

10. Long-Term Debt

Accounting treatment of long-term debt varies depending upon the source of repayment and the measurement focus applied, and whether the debt is reported in the government-wide or fund financial statements.

All long-term debt to be repaid from governmental activities, business-type activities and proprietary funds are reported as liabilities as incurred. The long-term debt presently is primarily comprised of general obligation bonds, capital lease obligations payable, revenue bonds payable, net pension liability, total OPEB liability, and accrued compensated absences. This long-term debt is reported net of unamortized discounts and premiums.

Long-term debt of governmental funds is not reported as liabilities in the fund financial statements. The debt proceeds are reported as other financing sources and payments of principal and interest are reported as expenditures.

11. 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 Oklahoma Police Pension & Retirement System (OPPRS) and the Oklahoma Firefighters Pension & Retirement System (FPRS) and additions to/deductions from OPPRS’s and FPRS’s fiduciary net positions have been determined on the same basis as they are reported by OPPRS and FPPRS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.

32

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

C. Assets, Deferred Outflows, Liabilities, Deferred Inflows and Equity (Continued)

12. Net Position/Fund Balance

In the government-wide financial statement and proprietary fund financial statements, net position represents the difference between assets, deferred outflows, liabilities and deferred inflows. Net investment in capital assets consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowing used for the acquisition, construction, or improvement of those assets. Net position is reported as restricted when limitations on its use change the nature or normal understanding of the availability of the asset. Such constraints are either externally imposed by creditors, contributors, grantors, laws or other governments, or are imposed by law through constitutional provisions or enabling legislation. In the fund financial statements, governmental funds report the hierarchy of fund balances. The hierarchy is based primarily on the degree of spending constraints placed upon use of resources for specific purposes versus availability of appropriation. An important distinction that is made in reporting fund balance is between amounts that are considered nonspendable (i.e., fund balance associated with assets that are not in spendable form, such as inventories or prepaid items, long-term portions of loans and notes receivable, or items that are legally required to be maintained intact (such as the corpus of a permanent fund) and those that are spendable (such as fund balance associated with cash, investments or receivables). Amounts in the spendable fund balance category are further classified as restricted, committed, assigned or unassigned, as appropriate.

Restricted fund balance represents amounts that are constrained either externally by creditors (such as debt covenants), grantors, contributors or laws or regulations of other governments; or by law, through constitutional provisions or enabling legislation.

Committed fund balance represents amounts that are useable only for specific purposes by formal action of the government’s highest level of decision-making authority. Such amounts are not subject to legal enforceability (like restricted amounts), but cannot be used for any other purpose unless the government removes or changes the limitation by taking action similar to that which imposed the commitment. The City Ordinance is the highest level of decision-making authority of the City. Assigned fund balance represents amounts that are intended to be used for specific purposes, but are neither restricted nor committed. Intent is expressed by the governing body itself, or a subordinated high-level body or official who the governing body has delegated the authority to assign amounts to be used for specific purposes. Assigned fund balances includes all remaining spendable amounts (except negative balances) that are reported in governmental funds other than the general fund, that are neither restricted nor committed, and amounts in the general fund that are intended to be used for specific purpose in accordance with the provisions of the standard.

Unassigned fund balance is the residual classification for the general fund. It represents the amounts that have not been assigned to other funds, and that have not been restricted, committed, or assigned to specific purposes within the general fund.

33

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

C. Assets, Deferred Outflows, Liabilities, Deferred Inflows and Equity (Continued) 13. Resource Use Policy

It is in the City’s policy for all funds that when an expenditure/expense is incurred for purposes for which both restricted and unrestricted resources, including fund balances, are available, the City considers restricted amounts to be spent first before any unrestricted amounts are used. Furthermore, it is the City’s policy that when an expenditure/expense is incurred for purposes for which committed, assigned, or unassigned resources, including fund balances, are available, the City considers committed amounts to be spent first, followed by assigned amounts and lastly unassigned amounts.

14. Revenues, Expenditures, and Expenses

Sales and Use Tax – The City presently levies 3.55 cent sales and use tax on taxable sales within the City. All sales and use tax are initially deposited into the General Fund. Then .55 cents is transferred to the Vision Sales Tax Fund to be used for specific purposes in accordance with Ordinance 1392, effective for 15 years from January 1, 2017. Additionally, a pledge of sales and use tax revenue for JPWA bonds requires all 3 cents initially deposited into the General Fund be transferred to the JPWA for debt service and then 2 cents is transferred back to the General Fund and the remaining one cent transferred to the JPWA One Cent Capital Fund to be used for capital and related debt service. Property Tax – Under State law, municipalities are limited in their ability to levy a property tax. Such tax may only be levied to repay principal and interest on general obligation bonded debt approved by voters and any court-assessed judgments. At the present time the City levies a property tax to fund the annual debt service requirements of the following general obligation bonds: 1999 General Obligation Bonds 2002 General Obligation Bonds 2006 General Obligation Bonds 2010 General Obligation Bonds 2014 General Obligation Bonds

The property tax levy, as determined by the City’s debt service needs, is submitted to the County Excise Board for approval. County assessors, elected officials, determine the taxable value of real estate and personal property in the County. A State Board of Equalization hears complaints on real estate values with the power to equalize assessments. Under present State law, the ratio of assessed value to true value cannot be less than 11 percent or more than 13 ½ percent. Property taxes levied by the City are billed and collected by the County Treasurer’s office and remitted to the City in the month following collection. Property taxes are levied normally in October and are due in equal installments on December 31 and March 31. Property taxes unpaid for the fiscal year are attached by an enforceable lien on property in the following October. For the year ended June 30, 2019, the City’s net assessed valuation of taxable property was $285,181,575. The taxes levied by the City per $1,000 of net assessed valuation for the year ended June 30, 2019 was $10.44. Expenditures/Expenses – In the government-wide statement of activities, expenses, including depreciation of capital assets, are reported by function or activity. In the governmental fund financial statements, expenditures are reported by class as current (further reported by function), capital outlay and debt service. In proprietary fund financial statements, expenses are reported by activity.

34

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

2. DETAILED NOTES –TRANSACTION CLASSES/ACCOUNTS

A. Deposits and Investments

Custodial Credit Risk

Custodial credit risk is the risk that in the event of a bank failure, the government deposits may not be returned to it. The City is governed by the State Public Deposits Act which requires that the City obtain and hold collateral whose fair value exceeds the amount of uninsured deposits. Investment securities are exposed to custody credit risk if the securities are uninsured, are not registered in the name of the government, and if held by a counterparty or a counterparty’s trust department or agent, but not in the government’s name. As of June 30, 2019, the City was exposed to custodial credit risk in the amount of $43,531. This exposure was eliminated subsequent to the fiscal year end.

Investment Interest Rate Risk

Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of investment. The City does not have a formal investment risk policy. The City discloses its exposure to interest rate risk by disclosing the maturity dates of its various investments. Investment Credit Risk

Investment credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. The City has no formal policy limiting investments based on credit rating, but discloses any such credit risk associated with their investments by reporting the credit quality ratings of investments in debt securities as determined by nationally recognized statistical rating organizations-rating agencies-as of year-end. Investments of the City (excluding Public Trusts) are limited by state law to the following:

a. Direct obligations of the U.S. Government, its agencies and instrumentalities to which the full faith and credit of the U.S. Government is pledged, or obligations to the payment of which the full faith and credit of the State of Oklahoma is pledged.

b. Certificates of deposit or savings accounts that are either insured or secured with acceptable collateral with in-state financial institutions, and fully insured certificates of deposit or savings accounts in out-of-state financial institutions.

c. With certain limitation, negotiable certificates of deposit, prime banker’s acceptances, prime commercial paper and repurchase agreements with certain limitations.

d. County, municipal or school district tax supported debt obligations, bond or revenue anticipation notes, money judgments, or bond or revenue anticipation notes of public trusts whose beneficiary is a county, municipality or school district.

e. Notes or bonds secured by mortgage or trust deed insured by the Federal Housing Administrator and debentures issued by the Federal Housing Administrator, and in obligations of the National Mortgage Association.

f. Money market funds regulated by the SEC and in which investments consist of the investments mentioned in the previous paragraphs (a.-e.).

Public trusts created under O.S. Title 60, are not subject to the above noted investment limitations and are primarily governed by any restrictions in their trust or bond indentures. The City complied, in all material respects, with the above noted investment restrictions. Unless there is information to the contrary, obligations of the U.S. government or obligations explicitly guaranteed by the U.S. government are not considered to have credit risk and do not require disclosure of credit quality.

35

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

2. DETAILED NOTES –TRANSACTION CLASSES/ACCOUNTS (Continued)

A. Deposits and Investments (Continued)

Concentration of Investment Credit Risk Exposure to concentration of credit risk is considered to exist when investments in any one issuer represent a significant percent of total investments of the City (any over 5% are disclosed). Investments issued or explicitly guaranteed by the U.S. government and investments in mutual funds, external investment pools and other pooled investments are excluded from this consideration. The City was not exposed to this risk as defined above. The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 are significant other observable inputs; Level 3 inputs are significant unobservable inputs. The City did not hold investments that were measured at fair value as of June 30, 2019.

The City held the following deposits and investments at June 30, 2019:

Credit Carrying

Type Maturities Rating Value

Deposits:

Demand deposits and cash on hand n/a 27,387,844$

Time deposits Due within one year 24,880,297

Time deposits Due in 1 - 5 years 7,240,226

59,508,367$

Investments:

Money market funds n/a AAA 11,904,177$

Total deposits and investments 71,412,544$

Reconciliation to Statement of Net Position:

Cash and cash equivalents 39,127,963$

Investments 32,284,581

71,412,544$

B. Restricted Assets

The amounts reported as restricted assets on the Proprietary Funds Statement of Net Position are comprised of cash and investments held by the trustee bank on behalf of the public trusts related to its required revenue bond accounts and amounts due to depositors related to utility deposits.

Current NoncurrentCash and cash Cash and cash

Equivalents Equivalents

Utility Deposits 53,020$ 477,180$ JAA Security Interest for bank note guaranteed by JPWA 16,306 - Trustee Accounts:

JAA 2014 Bond Fund 966,889 - JAA 2014 Bond Reserve Fund - 309,427JPWA 2012 Bond Fund 46,321 -

Total 1,082,536$ 786,607$

36

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

2. DETAILED NOTES –TRANSACTION CLASSES/ACCOUNTS (Continued)

C. Accounts Receivable, Court Fines Receivable, and Due from Other Governments

The City's estimate of uncollectible accounts receivable by fund and activity is as follows:

Less: Allowance Net

Accounts for Uncollectible Accounts

Receivable Accounts Receivable

Utilities 1,816,889$ (421,852)$ 1,395,037$

Aquarium 82,381 - 82,381

Total Enterprise Fund Accounts Receivable 1,899,270$ (421,852)$ 1,477,418$

Property Tax 206,630$ (29,765)$ 176,865$

Sales and Use Tax 1,161,259 - 1,161,259

Other amounts Due from Other Governments 163,480 - 163,480

Total Due from Other Governments 1,531,369$ (29,765)$ 1,501,604$

Court Fines Receivable 1,082,351$ (905,813)$ 176,538$

D. Capital Assets

Primary Government capital asset activity for the year ended is as follows:

Balance at Balance at

Governmental activities: July 1, 2018 Additions Transfers Disposals June 30, 2019

Capital assets not being depreciated:

Land 2,455,892$ -$ 552,651$ -$ 3,008,543$

Construction in progress 15,014,018 5,993,226 (17,296,976) - 3,710,268

Total capital assets not being depreciated 17,469,910 5,993,226 (16,744,325) - 6,718,811

Other capital assets:

Buildings 6,362,935 102,285 1,319,286 - 7,784,506

Roads and Bridges - 8,001 581,406 - 589,407

Other improvements 290,683 - - - 290,683

Machinery and equipment 6,045,905 2,424,755 159,832 (498,433) 8,132,059

Infrastructure 45,672,187 574,021 16,795,299 (225,252) 62,816,255

Total other capital assets at historical cost 58,371,710 3,109,062 18,855,823 (723,685) 79,612,910

Less accumulated depreciation for:

Buildings (3,702,180) (321,984) - - (4,024,164)

Other improvements (7,056) (20,252) - - (27,308)

Machinery and equipment (3,821,474) (487,456) 106,949 454,357 (3,747,624)

Infrastructure (10,442,436) (2,649,545) - 61,898 (13,030,083)

Total accumulated depreciation (17,973,146) (3,479,237) 106,949 516,255 (20,829,179)

Other capital assets, net 40,398,564 (370,175) 18,962,772 (207,430) 58,783,731

Governmental activities capital assets, net 57,868,474$ 5,623,051$ 2,218,447$ (207,430)$ 65,502,542$

37

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

2. DETAILED NOTES - TRANSACTION CLASSES/ACCOUNTS (Continued) D. Capital Assets (Continued)

Balance at Balance at

Business-type activities: July 1, 2018 Additions Transfers Disposals June 30, 2019

Capital assets not being depreciated:

Land 1,737,562$ 552,651$ (552,651)$ -$ 1,737,562$

Construction in progress 583,513 995,771 (1,036,834) - 542,450

Total capital assets not being depreciated 2,321,075 1,548,422 (1,589,485) - 2,280,012

Other capital assets:

Buildings 20,630,357 998,595 (369,636) - 21,259,316

Other improvements 110,956 5,520 - - 116,476

Exhibits 8,122,174 44,648 588,861 - 8,755,683

Machinery and equipment 3,038,954 565,606 (159,832) (53,149) 3,391,579

Infrastructure 11,148,994 2,280,725 (581,406) - 12,848,313

Total other capital assets at historical cost 43,051,435 3,895,094 (522,013) (53,149) 46,371,367

Less accumulated depreciation for:

Buildings (9,383,631) (600,423) - - (9,984,054)

Other improvements (8,879) (11,509) - - (20,388)

Exhibits (2,518,239) (473,950) - - (2,992,189)

Machinery and equipment (2,376,703) (192,684) (106,949) 53,149 (2,623,187)

Infrastructure (5,393,469) (432,073) - - (5,825,542)

Total accumulated depreciation (19,680,921) (1,710,639) (106,949) 53,149 (21,445,360)

Other capital assets, net 23,370,514 2,184,455 (628,962) - 24,926,007

Business-type activities capital assets, net 25,691,589$ 3,732,877$ (2,218,447)$ -$ 27,206,019$

Depreciation expense was charged to the following activities:

Business-type Activities:General government 170,860$ Water 123,249$ Public safety 510,063 Wastewater 604,680Economic development 237,832 Aquarium 837,380Streets 2,449,526 Industrial Authority 17,218Culture and recreation 110,956 Drainage 19,454

Total governmental activities depreciation expense 3,479,237$ General operations 108,658

Total business-type activities depreciation expense 1,710,639$

Governmental Activities:

E. Interfund balances and activities

Interfund receivables and payables at June 30, 2019, were as follows:

Payable To Receivable From Amount Nature of Interfund BalanceGeneral Fund JPWA Fund 248,901$ Items posted to incorrect fundSkyline JPWA Fund 17,894 Skyline sewer assessment district paymentsRisk Management Fund General Fund 7,764 COBRA payments/medical reimbursementsRisk Management Fund JPWA Fund 5,000 COBRA payments/medical reimbursementsEconomic Development Accomodation Fund JPWA Fund 341,842 For Small Animal Wet LabEconomic Development Accomodation Fund General Fund 1,200 Building permitsSinking Fund JPWA Fund 15,918 Debt service payments from incorrect fundJPWA Fund Skyline Fund 50,000 Loan from JPWA to Skyline FundJPWA Fund 2010 G.O. Bond Fund 100,000 Money market withdrawl from incorrect fundJPWA Fund JAA Fund 341,842 Small Animal Wet LabJPWA Fund General Fund 902 Items posted to incorrect fundJPWA (Wastewater Treatment) Fund General Fund 4,095 Payments received from developers

1,135,358$

Reconciliation to Fund Financial Statements:

Due From Due to Net Interfund BalancesGovernmental Funds 637,319$ (163,961)$ 473,358$ Proprietary Funds 498,039 (971,397) (473,358)

1,135,358$ (1,135,358)$ -$

38

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

2. DETAILED NOTES - TRANSACTION CLASSES/ACCOUNTS (Continued)

E. Interfund balances and activities (Continued)

Interfund transfers for the year ended June 30, 2019, were as follows:

Transfer From Transfer To Amount Purpose of Transfer

General Fund JPWA 6,121,748$ Pledged sales tax, 3 cents - bond indentureGeneral Fund JPWA 1,396,335 Use tax 3 centsGeneral Fund Vision Tax Fund 1,378,315 Sales tax .55 cents per ordinanceGeneral Fund TIF #4 7,403 Half Cent sales tax revenue - TIF #4JPWA General Fund 388,244 EMSA fees collected by JPWAJPWA General Fund 5,012,055 Return of 2 cents sales taxJPWA Radio Communication Fund 254,000 Debt payments for radio communications equipmentJPWA General Fund 100,000 City Manager SalaryGeneral Fund JPWA 4,348 Debt ServiceJPWA (One Cent Capital) Fund Uniform Patrol Vehicles Fund 140,000 Debt payments for uniform patrol vehiclesJPWA (One Cent Capital) Fund Fire Suppression Vehicles Fund 865,100 Debt payments for fire suppression vehiclesGeneral Fund (Municipal Court) Police General Receipts Fund 19,235 Fine revenue for police operating expensesJPWA (Risk Management) Fund JAA 75,000 Risk management funding

Total 15,761,783$

Transfers Transfers Capital Asset Net Transfers/In Out Activity Internal Activity

Reconciliation to Fund Financial Statements: Governmental Funds 8,164,352$ (8,927,384)$ 2,218,447$ 1,455,415$ Proprietary Funds 7,597,431 (6,834,399) (2,218,447) (1,455,415) Total Transfers 15,761,783$ (15,761,783)$ -$ -$

F. Allocation of Indirect Expenses

Certain indirect expenses (expenses benefiting more than one function) have been allocated to specific functions in the Statement of Activities, while other indirect expenses have not been allocated. Indirect expenses reported in the Statement of Activities under the function of General Government have not been allocated for governmental purposes. Indirect expenses of the proprietary funds, classified in the proprietary funds’ statement of revenues, expenses and changes in net position as General and Administrative have been allocated to the utility functions on a percentage of total utility revenues in the Statement of Activities.

G. Long-term Debt The City’s long-term debt is described below, segregated between the amounts to be repaid from governmental activities and amounts to be repaid from business-type activities. The governmental long-term debt of the financial reporting entity consisted of the following:

39

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

2. DETAILED NOTES - TRANSACTION CLASSES/ACCOUNTS (Continued) G. Long-term Debt (Continued)

Governmental Activities Long-Term Debt:

General Obligation Bonds:

$5,970,000 General Obligation Bonds of 2002, due in annual installments of $315,000 plus semi-annual interest payments; final installment of $315,000 plus interest due January 1, 2022; with interest rates at 0.125% - 10.00% $ 945,000

$16,090,000 General Obligation Bonds of 2006, due in annual installments of $850,000 plus semi-annual interest payments; final installment of $850,000 plus interest 'due January 1, 2026; with interest rates at 4.00% to 5.00% 5,950,000

$5,200,000 General Obligation Bonds of 2010, due in annual installments of $275,000 plus semi-annual interest payments; final installment of $275,000 plus interest due June 1, 2030; with interest rates at 2.25% - 5.25% 3,025,000

$13,760,000 General Obligation Bonds of 2014, due in annual installments of $725,000 plus semi-annual interest payments; final installment of $725,000 plus interest due February 1, 2034; with interest rates at 1.00% - 4.00% 10,875,000

Total General Obligation Bonds $ 20,795,000

Current portion $ 2,165,000 Non-current portion 18,630,000

$ 20,795,000

Notes Payable - Direct Borrowings:

$1,272,573 note payable with BancFirst, dated June 22, 2015, payable in monthly installments of $22,322 with a maturity date of October 1, 2020, with interest at 2.00%, collateralized by radio equipment purchased with the proceeds of the note. In the event of default, the lender may: 1) accelerate the payment of principal and interest accrued on the note, 2) require the borrower to assemble the collateral and deliver it to the lender, or 3) sell, lease, transfer, or otherwise dispose of the collateral. The grantor on the note is Jenks Public Works Authority, and the city is guaranteeing the note. $ 330,299

$1,494,776 note payable with BancFirst, dated September 14, 2018, payable in monthly installments of $27,226 with a maturity date of September 14, 2023, with interest at 3.50%, used to purchase a fire truck. In the event of default, the lender may: 1) accelerate the payment of principal and interest accrued on the note, 2) require the borrower to assemble the collateral and deliver it to the lender, or 3) sell, lease, transfer, or otherwise dispose of the collateral. 1,287,124

Total Notes Payable $ 1,617,423

Current portion $ 554,078 Non-current portion 1,063,345

$ 1,617,423

Capital Lease Obligations:

$75,332 capital lease with BancFirst, dated December 29, 2016, payable in 36 monthly installments of $2,190, with a maturity date of December 29, 2019 and interest at 2.95%; used to purchase 2 vehicles 12,999

$73,879 capital lease with BancFirst, dated September 15, 2016, payable in 36 monthly installments of $2,143, with a maturity date of September 15, 2019 and interest at 2.79%; used to purchase 2 vehicles 6,438

Total capital lease obligations 19,437$

Current portion 19,437Non-current portion -

19,437$

40

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

2. DETAILED NOTES - TRANSACTION CLASSES/ACCOUNTS (Continued) G. Long-term Debt (Continued)

Business-Type Activities Long-Term Debt:

Revenue Bonds:

$4,490,000 JPWA Refunding Revenue Bonds, Series 2012, issue date of April 1, 2012 with a maturity date of June 1, 2022; annual payments approximately $502,000 and interest rates from 1.40% - 2.50%; original bonds used to construct municipal building, water improvement lines, sanitary sewer lift station and lines, and Arkansas River Dam. $ 1,440,000

$17,115,000 JAA Revenue Bond, Series 2014 issued in April 2014 to refund JAA Revenue Bonds, Series 2004; annual payments approximately $1.2 million; original bonds used to construct aquarium (82.19%) and pay start-up operations costs (17.81%); matures in July 2034. The bonds are secured by a first mortgage on the aquarium facilities and a first lien on the gross revenues derived from the operation of the aquarium. Additionally, the Jenks Public Works Authority (JPWA) has entered into a replenishment agreement whereby JPWA has agreed to replenish the reserve fund in the event withdrawls are made from the reserve. There have been no withdrawals from the reserve fund through June 30, 2019. 14,475,000

Total General Obligation Bonds $ 15,915,000

Current portion $ 1,175,000 Non-current portion 14,740,000

$ 15,915,000

Note Payable - Direct Borrowing:

$1,400,000 JAA note payable with BancFirst, originally dated April 12, 2007 with subsequent renewals and a current maturity date of April 12, 2021, payable in annual installment of $700,000 plus interest with an interest rate of 3.75%, proceeds were used for capital (82.19%) and start-up operations (17.81%). Oklahoma Aquarium Foundation has certain pledged donations that are pledged as collateral on this note. Additionally, the note is guaranteed by the JPWA whereby the JPWA guarantees the full and prompt payment of all debt payments when due until the note has been paid in full. There have been no payments made by JPWA on the note through June 30, 2019. The guarantee of JPWA is secured by a first security interest in certain deposit accounts at the bank which had a balance of $16,306 as of June 30, 2019. In the event of default, the lender may: 1) accelerate the payment of principal and interest accrued on the note, 2) require the borrower to assemble the collateral and deliver it to the lender, or 3) sell, lease, transfer, or otherwise dispose of the collateral. $ 400,000

Current portion $ 400,000 Non-current portion -

$ 400,000

Capital Lease Obligations:

$18,000 JPWA capital lease with BancFirst, dated September 30, 2016, payable in 36 monthly installments of $522, with a maturity date of September 30, 2019 and interest at 2.79%; used to purchase a 2016 Hyundai Santa Fe. $ 1,552

Current portion 1,552$ Non-current portion -

1,552$

41

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

2. DETAILED NOTES - TRANSACTION CLASSES/ACCOUNTS (Continued) G. Long-term Debt (Continued)

The following is a summary of long-term debt transactions of the City:

AmountsBalance Balance Due Within

Type of Debt June 30, 2018 Additions Deductions June 30, 2019 One YearGovernmental Activities: General obligation bonds 23,160,000$ -$ 2,365,000$ 20,795,000$ 2,165,000$

Notes payable - direct borrowings 586,005 1,494,776 463,358 1,617,423 554,078 Capital lease obligation 88,683 - 69,247 19,436 19,437 Accrued compensated absences 235,626 153,797 193,027 196,396 39,279

Total Governmental Activities 24,070,314$ 1,648,573$ 3,090,632$ 22,628,255$ 2,777,794$

Reconciliation to Government-Wide Statement of Net Position:Due in One Year 2,777,794$ Due in More than One Year 19,850,461

22,628,255$

Business-Type Activities: Capital lease obligation 12,935$ -$ 11,383$ 1,552$ 1,552$

Note payable - direct borrowing 700,000 - 300,000 400,000 400,000 Revenue bonds payable 17,065,000 - 1,150,000 15,915,000 1,175,000 Accrued compensated absences 82,346 88,544 14,098 156,792 31,358 Total Business-Type Activities 17,860,281$ 88,544$ 1,475,481$ 16,473,344$ 1,607,910$

Reconciliation to Government-Wide Statement of Net Position:Due in One Year 1,607,910$ Due in More than One Year 14,865,434

16,473,344$

The annual debt service requirements to maturity, including principal, interest and administrative fees, for long-term debt are as follows:

GOVERNMENTAL ACTIVITY DEBT

Year Ending June 30,Principal Interest Principal Interest Principal Interest

2020 2,165,000 782,144 554,078 45,334 19,437 144 2021 2,165,000 714,475 362,539 30,977 - - 2022 2,165,000 645,706 306,620 20,089 - - 2023 1,850,000 572,213 317,679 9,030 - - 2024 1,850,000 497,050 76,507 482

2025-2029 6,700,000 1,445,163 - - - - 2030-2034 3,900,000 443,062 - - - -

Totals 20,795,000$ 5,099,813$ 1,617,423$ 105,912$ 19,437$ 144$

BUSINESS-TYPE ACTIVITY DEBTYear Ending June 30,

Principal Interest Principal Interest Principal Interest2020 1,175,000 531,797 400,000 15,000 1,552 14 2021 1,205,000 500,478 - - - - 2022 1,240,000 467,312 - - - - 2023 770,000 432,263 - - - - 2024 795,000 408,788 - - - -

2025-2029 4,355,000 1,649,006 - - - - 2030-2034 5,205,000 770,900 - - - -

2035 1,170,000 23,400 - - - - Totals 15,915,000$ 4,783,944$ 400,000$ 15,000$ 1,552$ 14$

Capital Lease Obligations

Capital Lease Obligations

Notes Payable - Direct BorrowingsGeneral Obligation Bonds

Note Payable - Direct BorrowingRevenue Bonds Payable

42

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

2. DETAILED NOTES - TRANSACTION CLASSES/ACCOUNTS (Continued) H. Pledge of Future Revenues The Jenks Aquarium Authority (JAA) has pledged revenues to repay the Series 2014 $17,115,000

Refunding Revenue Bonds payable. The total principal and interest payable for the remainder of the life of the note, as of June 30, 2019 is $19,190,244. Debt service payments of $1,206,113 for fiscal year 2019 were paid from the JAA’s gross revenues of $5,717,428. The debt service payments of $1,206,113 for fiscal year 2019 were 21.1% of the pledged gross revenues.

The Jenks Public Works Authority (JPWA) has pledged net revenues and three cents sales tax to repay

the Series 2012, $4,490,000 Refunding Bonds payable. The total principal and interest payable for the remainder of the life of the note as of June 30, 2019, is $1,508,700. Debt service payments on the note were $501,670 in fiscal year 2019. The pledged net revenues and sales taxes were $7,012,240. The debt service payments were 7.15% of the pledged net revenues and sales taxes

I. Commitments The City has agreed to remit 75% of its tax apportionment property tax revenues and 100% of its

incremental ½ cent sales tax levied within TIF District #1 to be applied toward the debt service payments on an $11,415,000 Tax Apportionment Note between the Tulsa County Industrial Authority and Village on Main, LLC. The City’s only obligation is to remit the taxes received. If the taxes remitted are insufficient to service the debt, the City is not obligated to make up the difference. Village on Main, LLC is responsible for debt payments in excess of the tax apportionment taxes remitted by the City. The term of the note is for 15 years and matures in June 2031. As of June 30, 2019, $6,525,000 had been drawn on the note. The proceeds of the note will be used to reimburse the City and Village on Main, LLC for the construction of public infrastructure and to construct a parking garage.

3. OTHER INFORMATION

A. Risk Management

The City is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; injuries to employees; employee health benefits; unemployment; and natural disasters. The City has established a self-insurance fund to cover deductibles on claims related to destruction, theft or damage of assets. Losses related to other risks or those exceeding deductibles are covered by commercial insurance. Management believes that such coverage is sufficient to preclude any significant uninsured losses to the City. Settled claims have not exceeded this insurance coverage in any of the past three fiscal years.

B. Contingent Liabilities

The City is a defendant in ongoing litigation and various legal actions arising from normal governmental activities. Although most of such actions are covered by insurance, certain actions might have some degree of exposure to the City. The outcome of these lawsuits is not presently determinable, and it is not known if the resolution of these matters will have a material adverse effect on the financial condition of the City.

Amounts received or receivable from grant agencies are subject to audit and adjustment by grantor agencies, principally the federal government. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures which may be disallowed by the grantor cannot be determined at this time although the City expects such amounts, if any, to be immaterial.

43

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued)

C. Asset Retirement Obligation The City has incurred certain asset retirement obligations related to the operation of its Wastewater utility system. The estimated liability of the legally required closure costs for the wastewater utility system cannot be reasonably estimated as of June 30, 2019, since the specific legally required costs of retirement have not yet been identified. The City anticipates identifying those specific legally required costs and obtaining an estimate of those costs in the subsequent fiscal year.

D. Employee Retirement System and Other Benefit Plans The City participates in three employee pension systems as follows:

Oklahoma Police Pension and Retirement Plan--Cost Sharing Multiple Employer - Defined Benefit Plan Oklahoma Firefighters Pension and Retirement Plan--Cost Sharing Multiple Employer - Defined Benefit Plan

International City Manager’s Association (ICMA) – Agent Multiple Employer - Defined Contribution Plan A summary of all the amounts recorded in the City’s financial statements for the plans is as follows:

GovernmentalActivities

Net Pension AssetPolice Pension System 200,557$

Net Pension LiabilityFirefighter's Pension System 4,069,148$

Total Net Pension Liability 4,069,148$

Deferred Outflows of ResourcesPolice Pension System 368,540$ Firefighter's Pension System 1,412,949

Total Deferred Outflows of Resources 1,781,489$

Deferred Inflows of ResourcesPolice Pension System 200,774$ Firefighter's Pension System 574,218

Total Deferred Inflows of Resources 774,992$

44

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued)

D. Employee Retirement System and Other Benefit Plans (Continued)

Oklahoma Police Pension and Retirement Plan

Plan description – The City of Jenks, as the employer, participates in the Oklahoma Police Pension and Retirement Plan – a cost-sharing multiple-employer defined benefit pension plan administered by the Oklahoma Police Pension and Retirement System (OPPRS). Title 11 of the Oklahoma State Statutes, through the Oklahoma Legislature, grants the authority to establish and amend the benefit terms to the OPPRS. OPPRS issues a publicly available financial report that can be obtained at www.ok.gov/OPPRS.

Benefits provided – OPPRS provides retirement, disability, and death benefits to members of the plan. The normal retirement date under the plan is the date upon which the participant completes 20 years of credited service, regardless of age. Participants become vested upon completing 10 years of credited service as a contributing participant of the plan. No vesting occurs prior to completing 10 years of credited service. Participants’ contributions are refundable, without interest, upon termination prior to normal retirement. Participants who have completed 10 years of credited service may elect a vested benefit in lieu of having their accumulated contributions refunded. If the vested benefit is elected, the participant is entitled to a monthly retirement benefit commencing on the date the participant reaches 50 years of age or the date the participant would have had 20 years of credited service had employment continued uninterrupted, whichever is later.

Monthly retirement benefits are calculated at 2.5% of the final average salary (defined as the average paid base salary of the officer over the highest 30 consecutive months of the last 60 months of credited service) multiplied by the years of credited service, with a maximum of 30 years of credited service considered. Monthly benefits for participants due to permanent disability incurred in the line of duty are 2.5% of the participants’ final average salary multiplied by 20 years. This disability benefit is reduced by stated percentages for partial disability based on the percentage of impairment. After 10 years of credited service, participants who retire due to disability incurred from any cause are eligible for a monthly benefit based on 2.5% of their final average salary multiplied by the years of service. This disability benefit is also reduced by stated percentages for partial disability based on the percentage of impairment. Effective July 1, 1998, once a disability benefit is granted to a participant, that participant is no longer allowed to apply for an increase in the dollar amount of the benefit at a subsequent date. Survivor’s benefits are payable in full to the participant’s beneficiary upon the death of a retired participant. The beneficiary of any active participant killed in the line of duty is entitled to a pension benefit. Contributions – The contributions requirements of the plan are at an established rate determined by Oklahoma Statute and are not based on actuarial calculations. Employees are required to contribute 8% percent of their annual pay. Participating cities are required to contribute 13% of the employees’ annual pay. Contributions to the pension plan from the City were $164,300. The State of Oklahoma also made on behalf contributions to OPPRS in the amount of $166,555 during the fiscal year and this is reported as both a revenue and an expenditure in the General Fund Statement of Revenues, Expenditures, and Changes in Fund Balance. In the government-wide Statement of Activities, revenue is recognized for the state’s on-behalf contributions on an accrual basis of $164,319. These on-behalf payments did not meet the criteria of a special funding situation.

45

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued)

D. Employee Retirement System and Other Benefit Plans (Continued) Pension Liabilities (Assets), Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions – At June 30, 2019, the City reported an asset of $200,557 for its proportionate share of the net pension asset. The net pension asset was measured as of June 30, 2018, and the total pension liability used to calculate the net pension asset was determined by an actuarial valuation as of July 1, 2018. The City’s proportion of the net pension asset was based on the City’s contributions received by the pension plan relative to the total contributions received by pension plan for all participating employers as of June 30, 2018. Based upon this information, the City’s proportion was 0.4210%. For the year ended June 30, 2019, the City recognized pension expense of $144,746. At June 30, 2019, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred Outflows

of ResourcesDeferred Inflows

of ResourcesDifferences between expected and actual experience 1,184$ 187,922$ Changes of assumptions 87,591 - Net difference between projected and actual earnings on pension plan investments 104,438 - Changes in proportion 9,435 1,956 City contributions during measurement date 1,592 10,896 City contributions subsequent to the measurement date 164,300 - Total 368,540$ 200,774$

The $164,300 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a decrease of the net pension liability in the year ended June 30, 2020. Any other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year ended June 30:

2020 107,895$

2021 43,016

2022 (113,024)

2023 (38,342)

2024 3,921

3,466$

Actuarial Assumptions – The total pension liability was determined by an actuarial valuation as of July 1, 2018, using the following actuarial assumptions, applied to all prior periods included in the measurement:

Inflation: 2.75% Salary increases: 3.5% to 10.0% average, including inflation Investment rate of return: 7.5% net of pension plan investment expense

46

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued)

D. Employee Retirement System and Other Benefit Plans (Continued)

Cost-of-living adjustments Police officers eligible to receive increased benefits according to repealed Section 50-120 of Title 11 of the Oklahoma Statutes pursuant to a court order receive an adjustment of 1/3 to ½ of the increase or decrease of any adjustment to the base salary of a regular police officer, based on an increase in base salary.

Mortality rates: Active employees (pre-retirement) RP-2000 Blue Collar

Healthy Combined table with age set back 4 years with fully generational improvement using Scale AA. Active employees (post-retirement): RP-2000 Blue Collar Healthy Combined table with fully generational Improvement using scale AA. Disabled pensioners: Blue Collar Healthy Combined table with age set forward 4 years.

The actuarial assumptions used in the July 1, 2018, valuation were based on the results of an actuarial experience study for the period July 1, 2012 to June 30, 2017. 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. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan's target asset allocation as of June 30, 2018, are summarized in the following table:

Long-Term Expected

Asset Class Real Rate of Return

Fixed income 4.53%

Domestic equity 5.86%

International equity 8.83%

Real estate 6.58%

Private Equity 9.21%

Commodities 5.06%

The current allocation policy is that approximately 60% of assets in equity instruments, including public equity, long-short hedge, venture capital, and private equity strategies; approximately 25% of assets in fixed income to include investment grade bonds, high yield and non-dollar denominated bonds, convertible bonds, and low volatility hedge fund strategies; and 15% of assets in real assets to include real estate, commodities, and other strategies.

47

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued)

D. Employee Retirement System and Other Benefit Plans (Continued)

Discount Rate – The discount rate used to measure the total pension liability was 7.5%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current contribution rate and that contributions from employers will be made at contractually required rates, determined by State statutes. Projected cash flows also assume the State of Oklahoma will continue contributing 14% of the insurance premium, as established by statute. 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

Sensitivity of the Net Pension Liability (Asset) to Changes in the Discount Rate – The following presents the net pension liability (asset) of the employers calculated using the discount rate of 7.5%, as well as what the Plan's net pension liability (asset) would be if it were calculated using a discount rate that is 1-percentage point lower (6.5%) or 1-percentage-point higher (8.5%) than the current rate:

1% Decrease Current Discount 1% Increase

(6.5%) Rate (7.5%) (8.5%)

Employers' net pension liability (asset) 930,323$ (200,557)$ (1,156,588)$ Pension plan fiduciary net position – Detailed information about the pension plan’s fiduciary net position is available in the separately issued financial report of the OPPRS; which can be located at www.ok.gov/OPPRS. Oklahoma Firefighters Pension & Retirement Plan

Plan Description – The City of Jenks, as the employer, participates in the Firefighters Pension & Retirement – a cost-sharing multiple-employer defined benefit pension plan administered by the Oklahoma Firefighters Pension & Retirement System (FPRS). Title 11 of the Oklahoma State Statutes grants the authority to establish and amend the benefit terms to the FPRS. FPRS issues a publicly available financial report that can be obtained at www.ok.gov/fprs. Benefits provided – FPRS provides retirement benefits to members of the plan. Benefits for members hired prior to November 1, 2013 are determined as 2.5 percent of the employee’s final average compensation times the employee’s years of service and have reached the age of 50 or have completed 20 years of service, whichever is later. For volunteer firefighters, the monthly pension benefit for normal retirement is $150.60 per month. Benefits vest with 10 years or more service. Benefits for members hired after November 1, 2013 are determined as 2.5 percent of the employee’s final average compensation times the employee’s years of service and have reached the age of 50 or have completed 22 years of service, whichever is later. For volunteer firefighters, the monthly pension benefit for normal retirement is $165.66 per month. Benefits vest with 11 years or more service.

48

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued)

D. Employee Retirement System and Other Benefit Plans (Continued) All firefighters are eligible for immediate disability benefits. For paid firefighters, the disability in-the-line-of-duty benefit for firefighters with less than 20 years of service is equal to 50% of final average monthly compensation, based on the most recent 30 months of service. For firefighters with over 20 years of service, a disability in-the-line-of-duty is calculated based on 2.5% of final average monthly compensation, based on the most recent 30 months, per year of service, with a maximum of 30 years of service. For disabilities not-in-the-line-of-duty, the benefit is limited to only those with less than 20 years of service and is 50% of final average monthly compensation, based on the most recent 60-month salary as opposed to 30 months. For volunteer firefighters, the not-in-the-line-of-duty disability is also limited to only those with less than 20 years of service and is $7.53 per year of service. For volunteer firefighters, the in-the-line-of-duty pension is $150.60 with less than 20 years of service, or $7.53 per year of service, with a maximum of 30 years. A $5,000 lump sum death benefit is payable to the qualified spouse or designated recipient upon the participant’s death. The $5,000 death benefit does not apply to members electing the vested benefit. Contributions – The contributions requirements of the plan are at an established rate determined by Oklahoma Statute and are not based on actuarial calculations. Employees are required to contribute 9% of their annual pay. Participating cities are required to contribute 14% of the employees’ annual pay. Contributions to the pension plan from the City were $159,411 (fiscal year contributions). The State of Oklahoma also made on-behalf contributions to FPRS in the amount of $367,639 during the fiscal year and this is reported as both a revenue and an expenditure in the General Fund Statement of Revenues, Expenditures, and Changes in Fund Balance. In the government-wide Statement of Activities, revenue is recognized for the state’s on-behalf contributions on an accrual basis of $362,698. These on-behalf payments did not meet the criteria of a special funding situation.

Pension Liabilities, Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions – At June 30, 2019, the City reported a liability of $4,069,148 for its proportionate share of the net pension liability. The net pension liability was measured as of July 1, 2018, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of July 1, 2018. The City’s proportion of the net pension liability was based on the City’s contributions received by the pension plan relative to the total contributions received by pension plan for all participating employers as of June 30, 2018. Based upon this information the City’s proportion was 0.361493%. For the year ended June 30, 2019, the City recognized pension expense of $44,838. At June 30, 2019, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

49

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued)

D. Employee Retirement System and Other Benefit Plans (Continued)

Deferred Outflows of Resources

Deferred Inflows of Resources

Differences between expected and actual experience 849,931$ -$ Changes of assumptions - - Net difference between projected and actual earnings on pension plan investments 338,113 Changes in proportion and differences between City contributions and proportionate share of contributions 372,885 230,545 City contributions during the measuremnt date 30,722 5,560 City contributions subsequent to the measuremnt date 159,411 - Total 1,412,949$ 574,218$

The $159,411 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2020. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year ended June 30:2020 223,441$ 2021 179,045 2022 30,968 2023 159,398 2024 86,465

Thereafter 1 Total 679,318$

Actuarial Assumptions – The total pension liability was determined by an actuarial valuation as of July 1, 2018, using the following actuarial assumptions, applied to all prior periods included in the measurement: Inflation: 3% Salary increases: 3.5% to 9.0% average, including inflation Investment rate of return: 7.5% net of pension plan investment expense Mortality rates were based on the RP2000 combined healthy with blue collar adjustment as appropriate, with adjustments for generational mortality improvement using scale AA for healthy lives and no mortality improvement for disabled lives. The actuarial assumptions used in the July 1, 2018, valuation were based on the results of an actuarial experience study for the period July 1, 2007 to June 30, 2012.

50

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued)

D. Employee Retirement System and Other Benefit Plans (Continued) The long-term expected rate of return on pension plan investments was determined using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense, and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan’s target asset allocation as of June 30, 2018, are summarized in the following table:

Target Long-Term Expected

Asset Class Allocation Real Rate of Return

Fixed income 20% 7.00%

Domestic equity 47% 7.01%

International equity 15% 8.83%

Real estate 10% 6.58%

Other assets 8% 5.70%

Discount Rate – The discount rate used to measure the total pension liability was 7.5%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current contribution rate and that contributions from employers will be made at contractually required rates, determined by State statutes. Projected cash flows also assume the State of Oklahoma will continue contributing 36% of the insurance premium, as established by statute. 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. Sensitivity of the Net Pension Liability to Changes in the Discount Rate – The following presents the net pension liability of the employers calculated using the discount rate of 7.5%, as well as what the Plan’s net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.5%) or 1-percentage-point higher (8.5%) than the current rate:

1% Decrease Current Discount 1% Increase

-6.5% Rate -7.5% -8.5%

Employers' net pension liability 5,964,456$ 4,546,587$ 3,344,975$ Pension plan fiduciary net position – Detailed information about the pension plan’s fiduciary net position is available in the separately issued financial report of the FPRS; which can be located at www.ok.gov/fprs.

51

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued)

D. Employee Retirement System and Other Benefit Plans (Continued) International City Manager’s Association (ICMA) - Defined Contribution Plans The City participates in a defined contribution plan administered by the ICMA Retirement Corporation. Plan provisions are established or amended by City Council resolution. The City and its related entities are required to contribute 6.8% of annual covered payroll. Participants may make voluntary contributions to the plan. The plan participants include all employees not participating in the police or firefighter pension plans. Participants vest after one year of service and are entitled to 100 percent of vested contributions. The plan is a variable funding option plan where the contribution may be varied from year to year by the employer. For the year ended June 30, 2019, the following amounts related to the defined contribution plan:

Payroll for covered employees $3,840,723 Employer (City) contributions made $261,169

E. Other Post-Employment Benefits

1. Plan Description - The City participates in a defined benefit plan, a single-employer defined benefit OPEB plan administered by the City of Jenks. The City Council has the authority to establish and amend benefit provisions. No assets are accumulated in a trust that meets the criteria in paragraph 4 of Statement 75.

2. Benefits Provided – The City of Jenks provides medical coverage to eligible retirees and their dependents. Employees are eligible to receive medical coverage if they have 8 or more years of service at retirement. Employees may continue coverage into retirement on the City’s plan if they pay the entire premium. Dependents may also continue coverage on a pay-all basis. Coverage ceases upon the retiree reaching Medicare eligibility age. Retiree premiums are the same as active employee premiums. This results in the retirees and beneficiaries receiving an implicit rate subsidy.

3. Employees covered by benefit terms – At June 30, 2019 the following employees were covered by the benefit terms:

Active employees 129 Inactives or beneficiaries currently receiving benefit payments 1 Total 130

4. Discount Rate – A single discount rate of 2.79% was used to measure the total OPEB liability as of June

30, 2019. Since there is no dedicated trust to pay retiree healthcare benefits, the discount rate is a yield or index rate for 20-year, tax-exempt general obligation municipal bonds with an average rating of AA/Aa or higher. The S&P Municipal Bond 20 Year High-Grade Rate Index as of June 30, 2019 was used.

52

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued) E. Other Post-Employment Benefits (Continued)

5. Sensitivity of the Total OPEB Liability to Changes in the Health Care Cost Trend Rate – The following

presents the total OPEB liability of the City calculated using the health care cost trend rates of 7% to 5%, as well as what the Plan’s Total OPEB liability would be if it were calculated using health care cost trend rates that are 1-percentage point lower (6% to 4%) or 1-percentage-point higher (8% to 6%) than the current rate:

Current Health1% Decrease Care Trend Rate 1% Increase

(6% to 4%) (7% to 5%) (8% to 6%)

Total OPEB Liability 232,402$ 260,592$ 294,182$

6. Sensitivity of the Total OPEB Liability to Changes in the Discount Rate – The following presents the total

OPEB liability of the City calculated using the discount rate of 2.79%, as well as what the Plan’s Total OPEB liability would be if it were calculated using a discount rate that is 1-percentage point lower (1.79%) or 1-percentage-point higher (3.79%) than the current rate:

1% Decrease Current Discount 1% Increase(1.98%) (2.98%) (3.98%)

Total OPEB Liability 283,997$ 260,592$ 239,555$

7. Actuarial Assumptions – The total OPEB liability as of June 30, 2019 was determined based on an

actuarial valuation as of July 1, 2018 with roll forward provisions to measurement date of June 30, 2019 using the following actuarial assumptions:

Discount Rate 2.98% Inflation Rate 3.00% Salary Rate Increase 4.00% Initial Health Care Cost Trend Rate 7% Ultimate Health Care Cost Trend Rate 5% Fiscal Year the Ultimate Rate is Reached Fiscal Year 2028 Retiree Contribution Trend Same as Health Care Trend Mortality RP-2014 Combined Annuitant Mortality Table for

males and females Disability Rates None Retirement Rates Later of age 58 or the first age with 8 years of

service Withdrawal Rates Table T-5 from Pension Actuary’s Handbook

53

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued)

E. Other Post-Employment Benefits (Continued) Election at Retirement 5% of active employees will elect medical

coverage at retirement Marital Status 40% of active employees electing retiree

coverage are assumed to be married and to elect spousal coverage with males 3 years older than females. Actual spouse data was used for current retirees.

8. Total OPEB Liability, OPEB Expense, and Deferred Inflows of Resources Related to OPEB – The following table reports the components of changes in total OPEB liability:

Balance Beginning of Year $ 228,960

Changes for the Year:Service Cost 32,877 Interest on total OPEB liability 6,621Changes of assumptions 4,174Benefit Payments (13,554)Other Changes 1,514

Net changes 31,632

Balance End of Year 260,592$

Governmental Activities $ 130,296 Business-type Activities 130,296

260,592$

For the year ended June 30, 2019, the City recognized OPEB expense of $38,261. At June 30, 2019, the City reported deferred inflows of resources related to OPEB from the following sources:

Deferred DeferredOutflows of Inflows ofResources Resources

Differences between expected and actual experience -$ (10,130)$

Changes of assumptions 5,122 (4,860)

Total 5,122$ (14,990)$

54

CITY OF JENKS Jenks, Oklahoma

NOTES TO THE BASIC FINANCIAL STATEMENTS

June 30, 2019

3. OTHER INFORMATION (Continued) E. Other Post-Employment Benefits (Continued)

The deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Year ended June 30:2020 (1,237)$ 2021 (1,237) 2022 (1,237) 2023 (1,237) 2024 (1,237)

Thereafter (3,683) Total (9,868)$

4. FUND BALANCES AND NET POSITION

Fund Balance The following table shows the fund balance classifications as shown on the Governmental Fund Balance Sheet:

Other

General G.O. Sinking Fire Suppression Governmental TOTAL

Fund Fund Fund FundsFund Balances: Restricted for:

Law enforcement -$ -$ -$ 31$ 31$ Streets - - - 890,493 890,493 E911 - - - 1,240,474 1,240,474 Juvenile Justice programs - - - 5,440 5,440 Economic Development - - - 929,975 929,975 Capital Improvements - - - 7,584,076 7,584,076 Grants - - - 886 886 Debt Service 3,485,454 2,249,743 - - 5,735,197 Senior citizens - - - 2,821 2,821 Vision Projects - - - 2,096,771 2,096,771 TIF Projects - - - 751,626 751,626 Parking Garage Maintenance - - - 35,051 35,051 Wastewater Treatment - - - 108,481 108,481 Park and recreation - - - 456,493 456,493

Sub-total Restricted 3,485,454 2,249,743 - 14,102,618 19,837,815 Assigned to:

Subsequent Year Budget 666,400 - - - 666,400 Risk management 485,315 - - - 485,315 Riverwalk improvements 19,874 - - - 19,874 Debt service - 78,521 - - 78,521 Streets - - - 28,279 28,279 Senior citizens - - - 37 37 Park and recreation - - - 25,334 25,334 Law enforcement - - - 7 7 Wastewater treatment - - - 6,551 6,551 Vision Projects - - - 34,119 34,119 TIF projects - - - 10,617 10,617 E911 - - - 44,980 44,980 Juvenile Justice programs - - - 132 132 Economic Development 3,369,010 - - 20,183 3,389,193 Capital Improvements - - 179,140 505,051 684,191

Sub-total Assigned 4,540,599 78,521 179,140 675,290 5,473,550

Unassigned (deficit): 6,443,282 - - (9,195) 6,434,087

TOTAL FUND BALANCES 14,469,335$ 2,328,264$ 179,140$ 14,768,713$ 31,745,452$

55

CITY OF JENKS Jenks, Oklahoma

REQUIRED SUPPLEMENTARY INFORMATION

BUDGETARY COMPARISON SCHEDULE For the Fiscal Year Ended June 30, 2019

Budgetary Comparison Schedule (Budgetary Basis) – Year Ended June 20, 2019

City of JenksBudget and Actual (with Variances)

General FundFor the year ended June 30, 2019

Budgeted AmountsActual Amounts, Budgetary Basis

Variance with Final Budget -

Positive (Negative)

Original FinalREVENUES AND TRANSFERS IN

Taxes 9,661,889 9,661,889 10,104,948 443,059$ Intergovernmental 45,000 45,000 41,029 (3,971) Charges for services 94,100 94,100 66,568 (27,532) Fines and forfeitures 400,000 400,000 231,336 (168,664) Licenses and permits 392,000 392,000 289,502 (102,498) Investment income 90,000 90,000 167,450 77,450 Miscellaneous 109,600 109,600 121,962 12,362 Transfers in 5,115,360 5,115,360 5,502,299 386,939

Total revenues 15,907,949 15,907,949 16,525,094 617,145

EXPENDITURES AND TRANSFERS OUTCity manager 208,285 208,285 232,879 (24,594) City clerk 205,292 205,292 150,400 54,892 City treasury 65,801 65,801 45,003 20,798 City attorney 83,905 83,905 38,620 45,285 Personnel 157,775 157,775 140,397 17,378 Admin Support/records 111,940 111,940 78,166 33,774 Municipal court 88,569 88,569 68,585 19,984 General government 212,000 212,000 221,301 (9,301) City planner 77,445 77,445 71,485 5,960 Community development 43,630 43,630 10,257 33,373 Uniformed patrol 2,419,733 2,419,733 2,319,147 100,586 Police reserve 160,049 160,049 138,332 21,717 Central dispatch 426,287 426,287 414,403 11,884 Fire suppression 2,510,283 2,510,283 2,251,406 258,877 Fire volunteers 88,838 88,838 40,107 48,731 Protective inspections 90,107 90,107 72,811 17,296 Street maintenance 393,414 393,414 316,759 76,655 General maintenance 26,500 26,500 16,768 9,732 Parks & grounds 524,010 524,010 361,893 162,117 Animal conrol 98,032 98,032 74,704 23,328 OTA Turnpike - - - - Transfers out 8,531,889 8,531,889 9,003,801 (471,912)

Total Expenditures 16,523,784 16,523,784 16,067,224 456,560 Excess (deficiency) of revenues over expenditures (615,835) (615,835) 457,870 1,073,705

Net change in fund balances (615,835) (615,835) 457,870 1,073,705 Fund balances - beginning 5,831,000 5,831,000 10,242,159 4,411,159 Fund balances - ending 5,215,165$ 5,215,165$ 10,700,029$ 5,484,864$

56

CITY OF JENKS Jenks, Oklahoma

REQUIRED SUPPLEMENTARY INFORMATION

BUDGETARY COMPARISON SCHEDULE For the Fiscal Year Ended June 30, 2019

Footnote to Budgetary Comparison Schedules:

Explanation of Differences between Budgetary Inflows and Outflows and GAAP Revenues and Expenditures

REVENUES AND TRANSFERS IN:Actual amounts (budgetary basis) from the budgetary comparison schedule 16,525,094$ Differences - budgetary basis to GAAP:

State payments made on-behalf of police and fire pension not considereda budgetary resource 534,194

Change in accruals for revenue items 114,901 Total revenues and transfers in as reported on the statement of revenues,

expenditures, and changes in fund balance - governmental funds 17,174,189$

Total Revenues - General Fund 11,671,890$ Transfers In - General Fund 5,502,299

17,174,189$

EXPENDITURES AND TRANSFERS OUT:Actual amounts (budgetary basis) from the budgetary comparison schedule 16,067,224$ Differences - budgetary basis to GAAP:

Prior year encumbrances recorded as actual expenditures in current year 37,331 Current year outstanding encumbrances not recorded as actual expenditures

in current year (25,469) State payments made on-behalf of police and fire pension not considered

a budgetary expenditure 534,194 Transfer out from combined Municipal Court account 29,490

Change in accruals for expenditure items 177,011 Total expenditures and transfers out as reported on the statement of revenues,

expenditures, and changes in fund balance - governmental funds 16,819,781$

Total Expenditures - General Fund 7,782,141$ Transfers Out - General Fund 8,906,149 Intraaccount Transfers Out 131,491

16,819,781$

57

CITY OF JENKS Jenks, Oklahoma

REQUIRED SUPPLEMENTARY INFORMATION

BUDGETARY COMPARISON SCHEDULE For the Fiscal Year Ended June 30, 2019

Budget Law The City has adopted the provisions of the Municipal Budget Act of 1979 (the “Budget Act”). In accordance with the Budget Act, the following process is used to adopt the annual budget:

a. Prior to June 1, the City Manager submits to the City Council a proposed operating budget for the fiscal year commencing the following July 1.

b. Public hearings are conducted to obtain citizen comments. At least one public hearing must be held no later than 15 days prior to July 1.

c. Subsequent to the public hearings but no later than seven days prior to July 1, the budget is adopted by resolution of the City Council.

d. By July 31, the adopted budget is filed with the Office of State Auditor and Inspector. Per State law, the legal level of control at which expenditures may not legally exceed appropriations is the fund level. All transfers of appropriation between departments and supplemental appropriations require City Council approval. The City Manager may transfer appropriations between object categories within a department without City Council approval. Supplemental appropriations must also be filed with the Office of State Auditor and Inspector. No departments exceeded appropriations. Budgetary Accounting The annual operating budgets are prepared and presented on a budgetary basis of accounting. The differences between budgetary basis and modified accrual basis are shown in the following reconciliation schedule. The City utilizes encumbrance accounting under which all purchase orders, contracts, and other commitments for the expenditure of funds are recorded in order to reserve a portion of the applicable appropriation. Encumbrances outstanding at year-end are considered expenditures for budgetary purposes. All unencumbered appropriations lapse at year end.

58

CITY OF JENKS Jenks, Oklahoma

REQUIRED SUPPLEMENTARY INFORMATION

Schedules of Required Supplementary InformationSCHEDULE OF THE CITY OF JENKS' PROPORTIONATE SHARE OF THE NET PENSION LIABILITY (ASSET)OKLAHOMA POLICE PENSION & RETIREMENT SYSTEMLast 10 Fiscal Years*

2015 2016 2017 2018 2019

City's proportion of the net pension liability (asset) 0.3180% 0.3116% 0.3467% 0.3527% 0.4210%

City's proportionate share of the net pension liability (asset) (107,080)$ 14,051$ 530,903$ 27,129$ (200,557)$

City's covered-employee payroll 908,769$ 995,569$ 1,046,800$ 1,073,823$ 1,278,566$

City's proportionate share of the net pension liability (asset) as a percentage of its covered-employee payroll -11.78% 1.41% 50.72% 2.53% -15.69%

Plan fiduciary net position as a percentage of the total pension liability 101.53% 99.82% 93.50% 99.68% 101.89%

*The amounts present for each fiscal year were determined as of 6/30

Notes to Schedule:

*Only five years are presented because 10-year data is not yet available.

SCHEDULE OF CITY CONTRIBUTIONSOKLAHOMA POLICE PENSION & RETIREMENT SYSTEMLast 10 Fiscal Years*

2015 2016 2017 2018 2019

Statutorially required contribution 129,424$ 136,084$ 139,597$ 155,725$ 164,300

Contributions in relation to the statutorially required contribution 129,424 136,084 139,597 155,725 164,300

Contribution deficiency (excess) -$ -$ -$ -$ -$

City's covered-employee payroll 995,569$ 1,046,800$ 1,073,823$ 1,197,885$ 1,263,845$

Contributions as a percentage of covered-employee payroll 13.00% 13.00% 13.00% 13.00% 13.00%

Notes to Schedule:

*Only five years are presented because 10-year data is not yet available.

59

CITY OF JENKS Jenks, Oklahoma

REQUIRED SUPPLEMENTARY INFORMATION

Schedules of Required Supplementary InformationSCHEDULE OF THE CITY OF JENKS' PROPORTIONATE SHARE OF THE NET PENSION LIABILITYOKLAHOMA FIREFIGHTERS PENSION & RETIREMENT SYSTEMLast 10 Fiscal Years*

2015 2016 2017 2018 2019

City's proportion of the net pension liability 0.344800% 0.367799% 0.328256% 0.346728% 0.361493%

City's proportionate share of the net pension liability 3,546,247$ 3,903,848$ 4,010,356$ 4,360,871$ 4,546,599$

City's covered-employee payroll 932,521$ 1,014,036$ 927,043$ 940,236$ 1,342,450$

City's proportionate share of the net pension liability as a percentage of its covered-employee payroll 380% 385% 433% 464% 339%

Plan fiduciary net position as a percentage of the total pension liability 68.12% 68.27% 64.87% 66.61% 70.73%

*The amounts present for each fiscal year were determined as of 6/30

Notes to Schedule:

*Only five years are presented because 10-year data is not yet available.

60

CITY OF JENKS Jenks, Oklahoma

REQUIRED SUPPLEMENTARY INFORMATION

SCHEDULE OF CITY CONTRIBUTIONSOKLAHOMA FIREFIGHTERS PENSION & RETIREMENT SYSTEMLast 10 Fiscal Years*

2015 2016 2017 2018 2019

Statutorially required contribution 141,965$ 129,786$ 131,633$ 187,943$ 159,411$

Contributions in relation to the statutorially required contribution 141,965 129,786 131,633 187,943 159,411

Contribution deficiency (excess) -$ -$ -$ -$ -$

City's covered-employee payroll 1,014,036$ 927,043$ 940,236$ 1,342,450$ 1,138,650$

Contributions as a percentage of coverd-employee payroll 14.00% 14.00% 14.00% 14.00% 14.00%

Notes to Schedule:

*Only five years are presented because 10-year data is not yet available.

61

CITY OF JENKS Jenks, Oklahoma

REQUIRED SUPPLEMENTARY INFORMATION

Schedule of Required Supplementary InformationOther Post-Employment BenefitsSchedule of Changes in Total OPEB Liability and Related RatiosLast 10 Fiscal Years*

2018 2019

Total OPEB Liability:Service cost 30,998$ 32,877$ Interest 6,644 6,621 Difference between expected and actual experience (12,568) - Change in assumptions 4,733 4,174 Benefit payments (11,982) (13,554) Other changes (10,761) 1,514

Net change in total OPEB liability 7,064 31,632 Total OPEB Liability - beginning 221,896 228,960 Total OPEB Liability - ending 228,960$ 260,592$

Covered employee payroll 4,749,848$ 4,749,848$

Total OPEB liability as a percentage of covered employee payroll 4.82% 5.49%

* - Only two years are presented because 10-year data is not yet available.

62

CITY OF JENKS, OKLAHOMA OTHER SUPPLEMENTARY INFORMATION

General Fund Combining Balance Sheet Accounts – June 30, 2019

City of JenksCombining Balance Sheet - General Fund Accounts

June 30, 2019

General Fund

Riverwalk Improvement

DistrictEconomic

DevelopmentCity Risk

ManagementMunicipal Court

FundTotal General Fund Accounts

ASSETSCash and cash equivalents 6,064,799$ 19,874$ 1,276,831$ 233,722$ 200,840$ 7,796,066$ Investments 3,111,588 - 2,089,606 249,193 - 5,450,387 Accrued interest receivable 20,867 - 9,830 70 - 30,767 Due from other funds 256,665 - - 5,000 - 261,665 Intra-account balances 121,029 - - - (121,029) - Due from other governments 1,231,895 - - 9,167 - 1,241,062 Accounts receivable 4,035 - - - - 4,035 Court fines receivable, net 176,538 - - - - 176,538 Inventory - - - - - -

Total assets 10,987,416$ 19,874$ 3,376,267$ 497,152$ 79,811$ 14,960,520$

LIABILITIES, DEFERRED INFLOWS AND FUND BALANCESLiabilities:

Accounts payable 212,842$ -$ -$ 4,073$ -$ 216,915$ Due to other funds 6,197 - - 7,764 - 13,961 Due to other governments 5,981 - - - 81,242 87,223

Total liabilities 225,020 - - 11,837 81,242 318,099

Deferred Inflow of Resources:Unavailable revenue 165,829 - 7,257 - - 173,086

Fund balances:Restricted 3,485,454 - - - - 3,485,454 Assigned 666,400 19,874 3,369,010 485,315 - 4,540,599 Unassigned 6,444,713 - - - (1,431) 6,443,282

Total fund balances 10,596,567 19,874 3,369,010 485,315 (1,431) 14,469,335 Total liabilities, deferred inflows, and fund balances 10,987,416$ 19,874$ 3,376,267$ 497,152$ 79,811$ 14,960,520$

63

CITY OF JENKS, OKLAHOMA OTHER SUPPLEMENTARY INFORMATION

General Fund Accounts Combining Schedule of Revenues, Expenditures and Changes in Fund Balances – Year Ended June 30, 2019

City of JenksCombining Schedule of Revenues, Expenditures and Changes in Fund Balances - General Fund Accounts

For the Year Ended June 30, 2019

General Fund

Riverwalk Improvement

DistrictEconomic

DevelopmentCity Risk

ManagementMunicipal Court

FundTotal General Fund Accounts

REVENUESTaxes 10,107,923 -$ -$ -$ -$ 10,107,923$ Intergovernmental 573,740 - - 12,000 - 585,740 Charges for services 66,568 - - - - 66,568 Fines and forfeitures 344,107 - - - - 344,107 Licenses and permits 289,502 - - - - 289,502 Investment income 168,088 358 82,163 11,461 (227) 261,843 Miscellaneous 121,962 - - - - 121,962

Total revenues 11,671,890 358 82,163 23,461 (227) 11,777,645

EXPENDITURESCurrent:

General government 1,037,844 - - 44,302 - 1,082,146 Public safety 5,550,487 - - - - 5,550,487 Public services 827,383 - - - - 827,383 Culture and recreation 359,923 - - - - 359,923

Capital Outlay 6,504 - - - - 6,504 Total expenditures 7,782,141 - - 44,302 - 7,826,443

Excess (deficiency) of revenues over expenditures 3,889,749 358 82,163 (20,841) (227) 3,951,202

OTHER FINANCING SOURCES (USES)Transfers in 5,502,299 - - - (2,000) 5,500,299 Transfers out (8,906,149) - - - (21,235) (8,927,384) Intra-account transfers (131,491) - 100,000 - 31,491 - Bond premium - - - - - - Bond issue costs - - - - - -

Total other financing sources and uses (3,535,341) - 100,000 - 8,256 (3,427,085)

Net change in fund balances 354,408 358 182,163 (20,841) 8,029 524,117 Fund balances - beginning 10,242,159 19,516 3,186,847 506,156 (9,460) 13,945,218 Fund balances - ending 10,596,567$ 19,874$ 3,369,010$ 485,315$ (1,431)$ 14,469,335$

64

CIT

Y O

F J

EN

KS

, OK

LA

HO

MA

O

TH

ER

SU

PP

LE

ME

NT

AR

Y I

NF

OR

MA

TIO

N

Non

Maj

or G

over

nm

enta

l F

un

ds

Com

bin

ing

Bal

ance

Sh

eet

– Ju

ne

30, 2

019

Str

ee

t a

nd

All

ey

Po

lice

S

eiz

ure

Pa

rk

Re

cre

ati

on

Se

nio

r C

itiz

en

Ho

me

Re

ba

teS

kyli

ne

Im

pro

ve

me

nt

Eco

no

mic

D

eve

lop

me

nt

Acco

mo

da

tio

nV

isio

n S

ale

s T

ax

TIF

Dis

tric

t #3

AS

SE

TS

Cash a

nd c

ash e

quiv

ale

nts

548,3

31

$

38

$

283,2

18

$

2,8

58

$

21,1

66

$

22,9

09

$

612,8

57

$

2,1

30,8

90

$

183,3

09

$

Inve

stm

ents

365,9

31

-

122,0

61

-

170,5

54

-

-

-

-

Due fro

m o

ther

funds

-

-

-

-

-

17,8

94

341,8

42

-

-

Due fro

m o

ther

gove

rnm

ents

51,0

27

-

-

-

-

-

5,2

41

-

-

In

tere

st

receiv

able

2,6

10

-

2,2

60

-

2,2

48

2

-

-

-

Tota

l assets

967,8

99

$

38

$

407,5

39

$

2,8

58

$

193,9

68

$

40,8

05

$

959,9

40

$

2,1

30,8

90

$

183,3

09

$

LIA

BIL

ITIE

S,

DE

FE

RR

ED

IN

FL

OW

S A

ND

FU

ND

BA

LA

NC

ES

Lia

bil

itie

s:A

ccounts

payable

22,5

00

$

-$

140

$

-

$

-$

-

$

9,7

82

$

-

$

-$

D

ue t

o o

ther

funds

-

-

-

-

-

50,0

00

-

-

-

Tota

l lia

bili

ties

22,5

00

-

140

-

-

50,0

00

9,7

82

-

-

De

ferr

ed

In

flo

w o

f R

eso

urc

es:

Unava

ilable

reve

nue

26,6

27

-

2,2

60

-

2,2

48

-

-

-

-

Fu

nd

ba

lan

ce

s:R

estr

icte

d890,4

93

31

384,1

72

2,8

21

180,8

02

-

929,9

75

2,0

96,7

71

179,0

95

Assig

ned

28,2

79

7

20,9

67

37

10,9

18

-

20,1

83

34,1

19

4,2

14

Unassig

ned (

defic

it)

-

-

-

-

-

(9

,195)

-

-

-

Tota

l fu

nd b

ala

nces

918,7

72

38

405,1

39

2,8

58

191,7

20

(9,1

95)

950,1

58

2,1

30,8

90

183,3

09

Tota

l lia

bili

ties,

defe

rred inflo

ws,

and fund b

ala

nces

967,8

99

$

38

$

407,5

39

$

2,8

58

$

193,9

68

$

40,8

05

$

959,9

40

$

2,1

30,8

90

$

183,3

09

$

Ju

ne

30,

2019

Sp

ecia

l R

eve

nu

e F

un

ds

No

n-M

ajo

r G

ove

rnm

en

tal

Fu

nd

s

Cit

y o

f Je

nks

Co

mb

inin

g B

ala

nce

Sh

ee

t

65

CIT

Y O

F J

EN

KS

, OK

LA

HO

MA

O

TH

ER

SU

PP

LE

ME

NT

AR

Y I

NF

OR

MA

TIO

N

N

onM

ajor

Gov

ern

men

tal

Fu

nd

s C

omb

inin

g B

alan

ce S

hee

t –

Jun

e 30

, 201

9, (

Con

tin

ued

)

TIF

Dis

tric

t #4

E911

Pu

bli

c P

ark

ing

A

sse

ssm

en

tT

IF D

istr

ict

#1

Po

lice

Ge

ne

ral

Re

ce

ipts

TIF

Dis

tric

t #2

1978 S

an

ita

ry

Se

we

r F

un

d2002 G

O B

on

d

Fu

nd

1991 G

O B

on

d

Fu

nd

1998 R

oa

dw

ay

Imp

rove

me

nt

Fu

nd

AS

SE

TS

Cash a

nd c

ash e

quiv

ale

nts

60,6

29

$

402,3

99

$

35,2

11

$

516,4

34

$

9,7

75

$

1,8

71

$

68

$

77,9

14

$

72,1

06

$

148,8

25

$

Inve

stm

ents

-

859,7

71

-

-

-

-

-

-

-

-

D

ue fro

m o

ther

funds

-

-

-

-

-

-

-

-

-

-

D

ue fro

m o

ther

gove

rnm

ents

-

27,4

09

-

-

-

-

-

-

-

-

Inte

rest

receiv

able

-

5,3

62

-

-

-

-

-

-

-

-

Tota

l assets

60,6

29

$

1,2

94,9

41

$

35,2

11

$

516,4

34

$

9,7

75

$

1,8

71

$

68

$

77,9

14

$

72,1

06

$

148,8

25

$

LIA

BIL

ITIE

S,

DE

FE

RR

ED

IN

FL

OW

S A

ND

FU

ND

BA

LA

NC

ES

Lia

bili

ties:

Accounts

payable

-$

4,6

38

$

160

$

-

$

4,2

03

$

-

$

-

$

-

$

-

$

-

$

Due t

o o

ther

funds

-

-

-

-

-

-

-

-

-

-

Tota

l lia

bili

ties

-

4,6

38

160

-

4,2

03

-

-

-

-

-

DE

FE

RR

ED

IN

FL

OW

OF

RE

SO

UR

CE

SD

efe

rred r

eve

nue

-

4,8

49

-

-

-

-

-

-

-

-

Fund b

ala

nces:

Restr

icte

d59,2

84

1,2

40,4

74

35,0

51

511,3

78

5,4

40

1,8

69

68

74,9

68

69,7

91

143,4

05

Assig

ned

1,3

45

44,9

80

-

5,0

56

132

2

-

2,9

46

2,3

15

5,4

20

Unassig

ned (

defic

it)

-

-

-

-

-

-

-

-

-

-

Tota

l fu

nd b

ala

nces

60,6

29

1,2

85,4

54

35,0

51

516,4

34

5,5

72

1,8

71

68

77,9

14

72,1

06

148,8

25

Tota

l lia

bili

ties,

defe

rred inflo

ws,

and fund b

ala

nces

60,6

29

$

1,2

94,9

41

$

35,2

11

$

516,4

34

$

9,7

75

$

1,8

71

$

68

$

77,9

14

$

72,1

06

$

148,8

25

$

Ju

ne

30,

2019

Ca

pit

al

Pro

ject

Fu

nd

s

No

n-M

ajo

r G

ove

rnm

en

tal

Fu

nd

s

Sp

ecia

l R

eve

nu

e F

un

ds

Cit

y o

f Je

nks

Co

mb

inin

g B

ala

nce

Sh

ee

t

66

CIT

Y O

F J

EN

KS

, OK

LA

HO

MA

O

TH

ER

SU

PP

LE

ME

NT

AR

Y I

NF

OR

MA

TIO

N

Non

Maj

or G

over

nm

enta

l F

un

ds

Com

bin

ing

Bal

ance

Sh

eet

– J

un

e 30

, 201

9, (

Con

tin

ued

)

2014

GO

Bo

nd

F

un

dC

DB

G F

un

d201

0 G

O B

on

d

Fu

nd

Ra

dio

C

om

mu

nic

ati

on

s2006

GO

Bo

nd

F

un

dU

nif

orm

ed

Pa

tro

l V

eh

icle

s

To

tal

Go

ve

rnm

en

tal

Fu

nd

sA

SS

ET

SC

ash a

nd c

ash e

quiv

ale

nts

2,336,

358

$

886

$

1,5

72,0

64$

155,6

83

$

641,

610

$

27,6

37

$

9,8

65,

046

$

Inve

stm

ents

1,473,

531

-

1,2

19,3

19

-

488,

018

-

4,6

99,

185

Due

fro

m o

ther

funds

-

-

-

-

-

-

359,

736

D

ue fro

m o

ther

gove

rnm

ents

-

-

-

-

-

-

83,

677

Inte

rest

rece

ivabl

e11,

715

-

14,1

42

-

167

-

38,

506

Tota

l ass

ets

3,821,

604

$

886

$

2,8

05,5

25$

155,6

83

$

1,

129,

795

$

27,6

37

$

15,

046,

150

$

LIA

BIL

ITIE

S,

DE

FE

RR

ED

IN

FL

OW

S A

ND

FU

ND

BA

LA

NC

ES

Lia

bili

ties:

Accou

nts

paya

ble

24,

290

$

-

$

-$

-

$

-$

-$

65,

713

$

Due t

o o

ther

funds

-

-

100

,000

-

-

-

150,

000

Tota

l lia

bili

ties

24,

290

-

100

,000

-

-

-

215,

713

DE

FE

RR

ED

IN

FL

OW

OF

RE

SO

UR

CE

SD

efe

rred r

eve

nue

11,

598

-

14,1

42

-

-

-

61,

724

Fun

d b

ala

nces:

Restr

icte

d3,

645,

498

886

2,5

78,9

48

-

1,071,

398

-

14,

102,

618

A

ssig

ned

140,

218

-

112

,435

155,6

83

58,

397

27,6

37

675,

290

U

nass

igne

d (

defic

it)-

-

-

-

-

-

(9,1

95)

Tot

al fu

nd b

ala

nce

s3,

785,

716

886

2,6

91,3

83

155,6

83

1,

129,

795

27,6

37

14,

768,

713

To

tal l

iabili

ties,

defe

rred

inflo

ws,

and fu

nd b

ala

nces

3,821,

604

$

886

$

2,8

05,5

25$

155,6

83

$

1,

129,

795

$

27,6

37

$

15,

046,

150

$

No

n-M

ajo

r G

ove

rnm

en

tal

Fu

nd

sJu

ne

30,

2019

Ca

pit

al

Pro

ject

Fu

nd

s

Cit

y o

f Je

nks

Co

mb

inin

g B

ala

nce

Sh

ee

t

67

CIT

Y O

F J

EN

KS

, OK

LA

HO

MA

O

TH

ER

SU

PP

LE

ME

NT

AR

Y I

NF

OR

MA

TIO

N

Non

Maj

or G

over

nm

enta

l F

un

ds

Com

bin

ing

Sta

tem

ent

of R

even

ues

, Exp

end

itu

res

and

Ch

ange

s in

Fu

nd

Bal

ance

s –

Yea

r E

nd

ed J

un

e 30

, 201

9

Str

ee

t a

nd

All

ey

Po

lice

S

eiz

ure

Pa

rk R

ecre

ati

on

Se

nio

r C

itiz

en

Ho

me

Re

ba

teS

kyli

ne

Im

pro

ve

me

nt

Eco

no

mic

D

eve

lop

me

nt

Acco

mo

da

tio

nV

isio

n S

ale

s T

ax

TIF

Dis

tric

t #3

RE

VE

NU

ES

Taxes

-$

-$

-$

-$

-$

-

$

58,3

79

$

-$

296,4

99

$

Inte

rgove

rnm

enta

l201,3

70

-

-

-

-

-

-

-

-

C

harg

es for

serv

ices

-

-

-

-

-

-

-

-

-

Lic

enses a

nd p

erm

its

-

-

47,9

28

-

-

-

-

-

-

Inve

stm

ent

incom

e18,8

28

1

6,5

23

11

4,9

99

738

11,2

73

27,6

03

2,8

21

Mis

cella

neous

-

-

-

-

-

-

-

-

-

Tota

l re

venues

220,1

98

1

54,4

51

11

4,9

99

738

69,6

52

27,6

03

299,3

20

EX

PE

ND

ITU

RE

SC

urr

ent:

Genera

l gove

rnm

ent

-

-

-

-

-

-

-

-

251,4

98

Public

safe

ty-

-

-

-

-

-

-

-

-

Str

eets

22,5

00

-

-

-

-

-

-

-

-

Culture

and r

ecre

ation

-

-

59,9

49

-

-

-

-

-

-

Urb

an d

eve

lopm

ent

-

-

-

-

-

-

25,2

93

-

-

Capital outlay

-

-

69,2

00

-

-

-

-

-

-

Debt

serv

ice:

Princip

al

-

-

-

-

-

-

-

-

-

In

tere

st

-

-

-

-

-

-

-

-

-

Tota

l expenditure

s22,5

00

-

129,1

49

-

-

-

25,2

93

-

251,4

98

Excess (

defic

iency)

of re

venues o

ver

expenditure

s197,6

98

1

(7

4,6

98)

11

4,9

99

738

44,3

59

27,6

03

47,8

22

OT

HE

R F

INA

NC

ING

SO

UR

CE

S (

US

ES

)Tra

nsfe

rs in

-

-

-

-

-

-

-

1,3

78,3

15

-

P

roceeds fro

m long-t

erm

debt

-

-

-

-

-

-

-

-

-

Tota

l oth

er

financin

g s

ourc

es (

uses)

-

-

-

-

-

-

-

1,3

78,3

15

-

SP

EC

IAL

IT

EM

Net

change in fund b

ala

nces

197,6

98

1

(7

4,6

98)

11

4,9

99

738

44,3

59

1,4

05,9

18

47,8

22

F

und b

ala

nces -

begin

nin

g721,0

74

37

479,8

37

2,8

47

186,7

21

(9,9

33)

905,7

99

724,9

72

135,4

87

Fund b

ala

nces -

endin

g918,7

72

$

38

$

405,1

39

$

2,8

58

$

191,7

20

$

(9,1

95)

$

950,1

58

$

2,1

30,8

90

$

183,3

09

$

Fo

r th

e Y

ea

r E

nd

ed

Ju

ne

30,

2019

Sp

ecia

l R

eve

nu

e F

un

ds

Cit

y o

f Je

nks

Co

mb

inin

g S

tate

me

nt

of

Re

ve

nu

es,

Ex

pe

nd

itu

res

an

d C

ha

ng

es

in F

un

d B

ala

nce

sN

on

-Ma

jor

Go

ve

rnm

en

tal

Fu

nd

s

68

CIT

Y O

F J

EN

KS

, OK

LA

HO

MA

O

TH

ER

SU

PP

LE

ME

NT

AR

Y I

NF

OR

MA

TIO

N

Non

Maj

or G

over

nm

enta

l F

un

ds

Com

bin

ing

Sta

tem

ent

of R

even

ues

, Exp

end

itu

res

and

Ch

ange

s in

Fu

nd

Bal

ance

s –

Yea

r E

nd

ed J

un

e 30

, 20

19, (

Con

tin

ued

)

TIF

Dis

tric

t #4

E911

Pu

bli

c P

ark

ing

A

sse

ssm

en

tT

IF D

istr

ict

#1

Po

lice

Ge

ne

ral

Re

ceip

tsT

IF D

istr

ict

#2

1978 S

an

ita

ry

Se

we

r F

un

d2002

GO

Bo

nd

F

un

d1991 G

O B

on

d

Fu

nd

1998

Ro

ad

wa

y

Imp

rove

me

nt

Fu

nd

RE

VE

NU

ES

Taxes

92,2

56

$

226

,791

$

-$

953,

616

$

-$

1,8

69

$

-

$

-

$

-$

-

$

Inte

rgove

rnm

enta

l-

-

-

-

-

-

-

-

-

-

C

harg

es for

serv

ices

-

-

32,7

51

-

-

-

-

-

-

-

Licens

es a

nd p

erm

its-

-

-

-

-

-

-

-

-

-

In

vestm

ent

incom

e1,1

14

26,

597

-

2,376

103

2

-

1,476

1,3

46

2,8

37

Mis

cella

neo

us

-

-

-

-

-

-

-

-

-

-

Tot

al r

eve

nue

s93

,370

253

,388

32,7

51

955,

992

103

1,8

71

-

1,

476

1,3

46

2,8

37

EX

PE

ND

ITU

RE

SC

urr

ent:

Genera

l go

vern

ment

-

-

-

-

-

-

-

-

-

-

Public

safe

ty-

258

,569

-

-

16,9

51

-

-

-

-

-

S

treets

-

-

22,8

29

-

-

-

-

-

-

-

Culture

and r

ecre

ation

-

-

-

-

-

-

-

-

-

-

Urb

an d

eve

lopm

ent

74,2

72

-

-

589,

270

-

-

-

-

-

-

Capital

outlay

-

-

-

-

3,8

62

-

-

-

-

16,5

84

D

ebt

serv

ice:

Princip

al

-

-

-

-

-

-

-

-

-

-

Inte

rest

-

-

-

-

-

-

-

-

-

-

Tot

al e

xpenditu

res

74,2

72

258

,569

22,8

29

589,

270

20,8

13

-

-

-

-

16,5

84

Excess

(defic

iency)

of re

venues o

ver

expenditur

es

19,0

98

(5,1

81)

9,9

22

366,

722

(20,7

10)

1,8

71

-

1,

476

1,3

46

(1

3,7

47)

OT

HE

R F

INA

NC

ING

SO

UR

CE

S (

US

ES

)Tr

ans

fers

in

7,4

03

-

-

-

19,2

35

-

-

-

-

-

P

roceeds fr

om

long

-term

deb

t-

-

-

-

-

-

-

-

-

-

Tot

al o

ther

financin

g s

ourc

es (

uses)

7,4

03

-

-

-

19,2

35

-

-

-

-

-

SP

EC

IAL

IT

EM

Net

change in

fund b

ala

nces

26,5

01

(5,1

81)

9,9

22

366,

722

(1,4

75)

1,8

71

-

1,

476

1,3

46

(1

3,7

47)

F

und b

ala

nces -

beg

innin

g34

,128

1,290,

635

25,1

29

149,

712

7,0

47

-

68

76,

438

70,7

60

162,5

72

Fund b

ala

nces -

end

ing

60,6

29

$

1,285,

454

$

35,0

51

$

516,

434

$

5,5

72

$

1,8

71

$

68

$

77,

914

$

72,1

06

$

148,8

25

$

Ca

pit

al

Pro

ject

Fu

nd

sS

pe

cia

l R

eve

nu

e F

un

ds

69

CIT

Y O

F J

EN

KS

, OK

LA

HO

MA

O

TH

ER

SU

PP

LE

ME

NT

AR

Y I

NF

OR

MA

TIO

N

Non

Maj

or G

over

nm

enta

l F

un

ds

Com

bin

ing

Sta

tem

ent

of R

even

ues

, Exp

end

itu

res

and

Ch

ange

s in

Fu

nd

Bal

ance

s –

Yea

r E

nd

ed J

un

e 30

, 20

19, (

Con

tin

ued

)

2014 G

O B

on

d

Fu

nd

CD

BG

Fu

nd

2010 G

O B

on

d F

un

dR

ad

io

Co

mm

un

ica

tio

ns

2006 G

O B

on

d

Fu

nd

Un

ifo

rme

d

Pa

tro

l V

eh

icle

s

To

tal

Go

ve

rnm

en

tal

Fu

nd

sR

EV

EN

UE

STaxes

-$

-

$

-$

-$

-

$

-$

1,6

29,4

10

$

In

terg

ove

rnm

enta

l-

-

223,0

78

-

-

-

424,4

48

C

harg

es for

serv

ices

-

-

-

-

-

-

32,7

51

Lic

enses a

nd p

erm

its

-

-

-

-

-

-

47,9

28

Inve

stm

ent

incom

e79,7

36

-

39,9

36

2,0

50

23,2

04

94

253,6

68

M

iscellaneous

94,9

27

-

-

-

29,7

05

-

124,6

32

Tota

l re

venues

174,6

63

-

263,0

14

2,0

50

52,9

09

94

2,5

12,8

37

EX

PE

ND

ITU

RE

SC

urr

ent:

Genera

l gove

rnm

ent

-

-

-

-

-

-

251,4

98

P

ublic s

afe

ty-

-

-

63,2

62

-

-

338,7

82

S

treets

-

-

-

-

-

-

45,3

29

Culture

and r

ecre

ation

-

-

-

-

-

-

59,9

49

Urb

an d

eve

lopm

ent

-

-

-

-

-

-

688,8

35

C

apital outlay

558,0

44

-

-

-

86,7

23

45,7

87

780,2

00

D

ebt

serv

ice:

Princip

al

-

-

-

125,2

21

-

69,2

46

194,4

67

In

tere

st

-

-

-

8,6

92

-

1,6

41

10,3

33

Tota

l expenditure

s558,0

44

-

-

197,1

75

86,7

23

116,6

74

2,3

69,3

93

Excess (

deficie

ncy)

of re

venues o

ver

expenditure

s(3

83,3

81)

-

263,0

14

(1

95,1

25)

(3

3,8

14)

(1

16,5

80)

143,4

44

OT

HE

R F

INA

NC

ING

SO

UR

CE

S (

US

ES

)Tra

nsfe

rs in

-

-

-

254,0

00

-

140,0

00

1,7

98,9

53

P

roceeds fro

m long-t

erm

debt

-

-

-

-

-

-

-

Tota

l oth

er

financin

g s

ourc

es (

uses)

-

-

-

254,0

00

-

140,0

00

1,7

98,9

53

SP

EC

IAL

IT

EM

Net

change in fund b

ala

nces

(383,3

81)

-

263,0

14

58,8

75

(33,8

14)

23,4

20

1,9

42,3

97

F

und b

ala

nces -

begin

nin

g4,1

69,0

97

886

2,4

28,3

69

96,8

08

1,1

63,6

09

4,2

17

12,8

26,3

16

Fund b

ala

nces -

endin

g3,7

85,7

16

$

886

$

2,6

91,3

83

$

155,6

83

$

1,1

29,7

95

$

27,6

37

$

14,7

68,7

13

$

Fo

r th

e Y

ea

r E

nd

ed

Ju

ne

30,

2019

Ca

pit

al

Pro

ject

Fu

nd

s

Cit

y o

f Je

nks

Co

mb

inin

g S

tate

me

nt

of

Re

ve

nu

es,

Ex

pe

nd

itu

res a

nd

Ch

an

ge

s i

n F

un

d B

ala

nce

sN

on

-Ma

jor

Go

ve

rnm

en

tal

Fu

nd

s

70

CIT

Y O

F J

EN

KS

, OK

LA

HO

MA

O

TH

ER

SU

PP

LE

ME

NT

AR

Y I

NF

OR

MA

TIO

N

Com

bin

ing

Sch

edu

le o

f N

et P

osit

ion

– J

enk

s P

ub

lic

Wor

ks

Au

thor

ity

Acc

oun

ts –

Ju

ne

30, 2

019

C

ity o

f Je

nks

Sta

tem

en

t o

f N

et

Po

sit

ion

Pro

pri

eta

ry F

un

ds

Ju

ne

30,

2019

Pu

bli

c W

ork

s

Au

tho

rity

JP

WA

Sin

kin

g

Fu

nd

JP

WA

On

e C

en

t C

ap

ita

lJP

WA

WW

T

rea

tme

nt

JP

WA

R

eim

bu

rse

me

nt

to J

PW

AJP

WA

Eco

no

mic

D

eve

lop

me

nt

JP

WA

Ris

k

Ma

na

ge

me

nt

To

tal

AS

SE

TS

Curr

ent

assets

:C

ash a

nd c

ash e

quiv

ale

nts

3,5

77,1

70

$

1,0

38,7

05

$

3,9

48,8

08

$

1,2

10,5

72

$

908,3

93

$

247,1

79

$

2,7

72,4

15

$

13,7

03,2

42

$

R

estr

icte

d c

ash a

nd c

ash e

quiv

ale

nts

53,0

20

46,3

21

-

-

-

-

-

99,3

41

Inve

stm

ents

10,6

48,2

68

243,0

19

4,5

45,8

43

880,2

00

570,0

26

123,1

95

2,2

20,7

82

19,2

31,3

33

In

tere

st

receiv

able

48,7

08

2,8

21

24,1

11

5,8

49

1,9

62

603

10,2

20

94,2

74

Accounts

receiv

able

, net

1,3

95,0

37

-

-

-

-

-

-

1,3

95,0

37

In

tra-a

ccount

bala

nces

7,3

39

-

-

-

-

-

(7,3

39)

-

D

ue fro

m o

ther

funds

442,7

44

-

-

54,0

95

-

1,2

00

-

498,0

39

Tota

l curr

ent

assets

16,1

72,2

86

1,3

30,8

66

8,5

18,7

62

2,1

50,7

16

1,4

80,3

81

372,1

77

4,9

96,0

78

35,0

21,2

66

N

on-c

urr

ent

assets

:R

estr

icte

d c

ash a

nd c

ash e

quiv

ale

nts

477,1

80

-

-

-

-

-

-

477,1

80

C

apital assets

:Land a

nd o

ther

non-d

epre

cia

ble

assets

2,1

93,5

27

-

-

-

-

-

-

2,1

93,5

27

O

ther

capital assets

, net

of depre

cia

tion

10,7

84,9

88

-

-

-

-

-

-

10,7

84,9

88

Tota

l non-c

urr

ent

assets

13,4

55,6

95

-

-

-

-

-

-

13,4

55,6

95

Tota

l assets

29,6

27,9

81

1,3

30,8

66

8,5

18,7

62

2,1

50,7

16

1,4

80,3

81

372,1

77

4,9

96,0

78

48,4

76,9

61

DE

FE

RR

ED

OU

TF

LO

WS

OF

RE

SO

UR

CE

SO

PE

B1,0

86

-

-

-

-

-

-

1,0

86

Tota

l defe

rred o

utflo

ws

1,0

86

-

-

-

-

-

-

1,0

86

LIA

BIL

ITIE

SC

urr

ent

liabilitie

s:

Accounts

payable

1,0

35,9

22

-

470,3

53

7,0

00

-

-

168,0

78

1,6

81,3

53

A

ccru

ed p

ayro

ll lia

bilitie

s6,7

64

-

-

-

-

-

-

6,7

64

D

ue t

o o

ther

funds

629,5

55

-

-

-

-

-

-

629,5

55

A

ccru

ed inte

rest

payable

-

2,7

63

-

-

-

-

-

2,7

63

C

urr

ent

port

ion o

f:D

ue t

o d

epositors

53,0

20

-

-

-

-

-

-

53,0

20

Capital le

ase o

bligation p

ayable

1,5

52

-

-

-

-

-

-

1,5

52

R

eve

nue b

onds p

ayable

-

470,0

00

-

-

-

-

-

470,0

00

Accru

ed c

om

pensate

d a

bsences

14,0

66

-

-

-

-

-

-

14,0

66

Tota

l curr

ent

liabilitie

s1,7

40,8

79

472,7

63

470,3

53

7,0

00

-

-

168,0

78

2,8

59,0

73

N

on-c

urr

ent

liabilitie

s:

Due t

o d

epositors

477,1

80

-

-

-

-

-

-

477,1

80

Tota

l O

PE

B lia

bility

55,2

77

-

-

-

-

-

-

55,2

77

Reve

nue b

onds p

ayable

, net

-

970,0

00

-

-

-

-

-

970,0

00

A

ccru

ed c

om

pensate

d a

bsences

56,2

66

-

-

-

-

-

-

56,2

66

Tota

l non-c

urr

ent

liabilitie

s588,7

23

970,0

00

-

-

-

-

-

1,5

58,7

23

Tota

l liabilitie

s2,3

29,6

02

1,4

42,7

63

470,3

53

7,0

00

-

-

168,0

78

4,4

17,7

96

DE

FE

RR

ED

IN

FL

OW

S O

F R

ES

OU

RC

ES

O

PE

B3,1

80

-

-

-

-

-

-

3,1

80

NE

T P

OS

ITIO

NN

et

inve

stm

ent

in c

apital assets

12,9

76,9

63

(1

,440,0

00)

-

-

-

-

-

11,5

36,9

63

R

estr

icte

d for

debt

serv

ice

-

43,5

58

-

-

-

-

-

43,5

58

Unre

str

icte

d

14,3

19,3

22

1,2

84,5

45

8,0

48,4

09

2,1

43,7

16

1,4

80,3

81

372,1

77

4,8

28,0

00

32,4

76,5

50

Tota

l net

positio

n27,2

96,2

85

$

(1

11,8

97)

$

8,0

48,4

09

$

2,1

43,7

16

$

1,4

80,3

81

$

372,1

77

$

4,8

28,0

00

$

44,0

57,0

71

$

71

CIT

Y O

F J

EN

KS

, OK

LA

HO

MA

O

TH

ER

SU

PP

LE

ME

NT

AR

Y I

NF

OR

MA

TIO

N

Com

bin

ing

Sch

edu

le o

f R

even

ues

, Exp

ense

s an

d C

han

ges

in N

et P

osit

ion

– J

enk

s P

ub

lic

Wor

ks

Au

thor

ity

Acc

oun

ts –

Yea

r E

nd

ed J

un

e 30

, 20

19

C

ity o

f Je

nks

Sta

tem

en

t o

f R

eve

nu

es,

Ex

pe

nse

s a

nd

Ch

an

ge

s in

Fu

nd

Ne

t P

osi

tio

nP

rop

rie

tary

Fu

nd

sF

or

the

Ye

ar

En

de

d J

un

e 3

0,

2019

Pu

bli

c W

ork

s A

uth

ori

tyJP

WA

Sin

kin

g

Fu

nd

JP

WA

On

e C

en

t C

ap

ita

lJP

WA

WW

T

rea

tme

nt

JP

WA

R

eim

bu

rse

me

nt

to J

PW

AJP

WA

Eco

no

mic

D

eve

lop

me

nt

JP

WA

Ris

k

Ma

na

ge

me

nt

To

tal

RE

VE

NU

ES

Wate

r charg

es

9,8

61,4

27

$

-$

-$

-$

-$

-$

-$

9,8

61,4

27

$

Sew

er

charg

es

1,7

05,3

46

-

-

-

189,4

48

-

-

1,8

94,7

94

S

anitation

1,2

91,6

33

-

-

-

-

-

-

1,2

91,6

33

Lic

enses a

nd p

erm

its

-

-

-

65,5

90

-

15,6

00

-

81,1

90

Mis

cella

neous

594,3

30

-

-

-

-

-

-

594,3

30

Tota

l opera

ting r

eve

nues

13,4

52,7

36

-

-

65,5

90

189,4

48

15,6

00

-

13,7

23,3

74

OP

ER

AT

ING

EX

PE

NS

ES

Genera

l and a

dm

inis

trative

2,2

93,0

39

-

59,7

97

-

-

-

-

2,3

52,8

36

E

conom

ic d

eve

lopm

ent

593,1

03

-

33,4

87

-

-

-

-

626,5

90

C

ultura

l and r

ecre

ational

53,6

51

-

-

-

-

-

-

53,6

51

Wate

r serv

ice

7,6

86,0

70

-

103,6

80

-

-

-

-

7,7

89,7

50

S

ew

er

serv

ice

1,1

35,0

79

-

115,4

32

-

184,5

92

-

280,1

40

1,7

15,2

43

S

olid

waste

serv

ice

1,1

50,6

17

-

-

-

-

-

-

1,1

50,6

17

S

torm

wate

r dra

inage

199,0

77

-

122,9

04

-

-

-

-

321,9

81

D

epre

cia

tion e

xpense

856,0

41

-

-

-

-

-

-

856,0

41

Tota

l opera

ting e

xpenses

13,9

66,6

77

-

435,3

00

-

184,5

92

-

280,1

40

14,8

66,7

09

O

pera

ting incom

e (

loss)

(513,9

41)

-

(4

35,3

00)

65,5

90

4,8

56

15,6

00

(280,1

40)

(1,1

43,3

35)

16,2

32,2

04

NO

N-O

PE

RA

TIN

G R

EV

EN

UE

S (

EX

PE

NS

ES

)In

vestm

ent

incom

e343,2

59

33,7

48

210,1

27

47,7

22

30,2

41

8,7

89

118,7

61

792,6

47

M

iscella

neous

1,9

25

-

120,6

94

-

-

-

-

122,6

19

Tra

nsfe

r capital assets

to g

ove

rnm

enta

l activi

ties

(2,2

65,4

99)

-

-

-

-

-

-

(2

,265,4

99)

In

tere

st

expense a

nd fis

cal charg

es

(28)

(44,4

60)

-

-

-

-

-

(44,4

88)

Tota

l non-o

pera

ting r

eve

nue (

expenses)

(1,9

20,3

43)

(1

0,7

12)

330,8

21

47,7

22

30,2

41

8,7

89

118,7

61

(1

,394,7

21)

Incom

e (

loss)

befo

re c

ontr

ibutions a

nd t

ransfe

rs(2

,434,2

84)

(1

0,7

12)

(1

04,4

79)

113,3

12

35,0

97

24,3

89

(161,3

79)

(2,5

38,0

56)

Capital contr

ibutions

1,7

48,0

29

-

-

-

-

-

-

1,7

48,0

29

In

tera

ccount

transfe

rs(1

81,5

77)

510,0

00

(7

55,9

23)

(72,5

00)

-

-

500,0

00

-

Tra

nsfe

rs in

7,5

22,4

31

-

-

-

-

-

-

7,5

22,4

31

Tra

nsfe

rs o

ut

(5,7

54,2

99)

-

(1,0

05,1

00)

-

-

-

(75,0

00)

(6

,834,3

99)

C

hange in n

et

positio

n900,3

00

499,2

88

(1

,865,5

02)

40,8

12

35,0

97

24,3

89

263,6

21

(1

01,9

95)

Tota

l net

positio

n -

begin

nin

g26,3

95,9

85

(6

11,1

85)

9,9

13,9

11

2,1

02,9

04

1,4

45,2

84

347,7

88

4,5

64,3

79

44,1

59,0

66

Tota

l net

positio

n -

endin

g27,2

96,2

85

$

(1

11,8

97)

$

8,0

48,4

09

$

2,1

43,7

16

$

1,4

80,3

81

$

372,1

77

$

4,8

28,0

00

$

44,0

57,0

71

$

72

CITY OF JENKS Jenks, Oklahoma

OTHER SUPPLEMENTARY INFORMATION

Schedule of State Awards

CITY OF JENKS, OKLAHOMASCHEDULE OF EXPENDITURES OF STATE AWARDS

For the fiscal year ended June 30, 2019

FederalFederal Grantor/Pass through agency CFDA Award StateGrantor/Program Title Number Grant # Amount Expenditures

STATE AWARDS:

INCOG

CENA - Service Equipment n/a n/a 12,000 12,000

TOTAL STATE AWARDS 12,000$ 12,000$

73

INTERNAL CONTROL AND COMPLIANCE INFORMATION

74

  

309 N. Bryant Ave. • Edmond, OK 73034 • 405.348.0615 • Fax 405.348.0931 • www.jmacpas.com Member of AICPA and OSCPA

 

  

INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF

FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

 

To the Honorable Mayor and Members of the City Council City of Jenks, Oklahoma

We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City of Jenks, Oklahoma, (the “City”), as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated May 11, 2020.

Internal Control over Financial Reporting

In planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing an opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.

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

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

Compliance and Other Matters

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

75

 

  

Purpose of this Report

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

May 11, 2020

76

EXHIBIT E

LEASE (as supplemented)

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

EXHIBIT F FORM OF OPINION OF BOND COUNSEL

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

We have examined a certified copy of the Transcript of Proceedings of the Trusteesof The Jenks Public Works Authority (the "Authority") preliminary to, and in theissuance of Utility System Revenue Bonds Series 2020 of the Authority (the"Bonds"), in the principal amount of $3,150,000.00 and a specimen Bond of theissue, and based upon such examination, it is our opinion that said issue is lawfullyauthorized by said proceedings under present law. The Bonds are issuable only inregistered form in denominations of $5,000 and, with respect to principal maturingon the same date, integral multiples thereof are exchangeable for other Bonds ofthe same maturity, bear interest payable on February 1 and August 1 of each yearcommencing February 1, 2021, until the principal is paid, and mature on August 1in the years, in the principal amounts and bear interest at the rates all as set forthon the face thereof and in the Indenture hereinafter mentioned.

The items examined included the Declaration of Trust dated September 10, 1969,as supplemented, Lease dated February 2, 1970, as supplemented, by which theCity of Jenks, Oklahoma (the "City"), leased to the Authority all then existing andthereafter acquired water and sanitary sewer systems (the "Systems") for a primaryterm extending to March 4, 2019, and so long thereafter as any indebtedness of theAuthority secured by the Systems or their revenues shall remain unpaid, The JenksPublic Works Authority Series 2020 Revenue Bond Indenture dated August 1, 2020(the "Indenture"), between the Authority and BancFirst, Oklahoma City, Oklahoma,as trustee, the proceedings authorizing execution and delivery of all of theforegoing, and the relevant provisions of the Constitution and Statutes of the Stateof Oklahoma.

From such examination, it is our opinion that the Authority is a validly existing publictrust of which the City is the beneficiary and, as such, an agency of the State ofOklahoma and regularly constituted authority of the City, that the Bonds and theaforesaid Indenture are valid and binding obligations of the Authority according totheir terms, the Bonds being secured by the Net Revenues, as defined in theIndenture. The Bonds are exempted securities within the meaning of Section3(a)(2) of the Securities Act of 1933 and Section 3(a)(12) of the SecuritiesExchange Act of 1934 and the approval of no agency of the State of Oklahomaother than the Authority is required for their issuance. No qualification of theIndenture is required under the Trust Indenture Act of 1939.

It is our further opinion that interest paid by the Authority on the Bonds is and,assuming continuing compliance by the Authority with its hereinafter describedcovenants to comply with all of the requirements of the Internal Revenue Code of1986, as amended, contained in the aforesaid Indenture, said interest will continueto be excluded from the gross income of the payees thereof in the computation offederal income taxes under present law and interpretation thereof and is not an itemof tax preference for purposes of the federal alternative minimum tax. In ouropinion, the covenants contained in the aforesaid Indenture by which the Authorityhas agreed to comply with the Internal Revenue Code of 1986, as amended, to theend that interest on the Bonds shall remain exempt from federal income taxes arevalid and binding obligations of the Authority and compliance therewith is notprohibited by or violative of any provision of law applicable to the Authority. Thefailure of the Authority to comply with its aforesaid covenants could cause theinterest on the Bonds to be so included in gross income retroactive to the date ofissuance of the Bonds.

It is our further opinion that interest paid by the Authority on the Bonds is excludedfrom the gross income of the payees hereof in the computation of State ofOklahoma income taxes.

JOHANNING & BYROM, PLLC

ByChris Byrom

CB:pe

EXHIBIT G

CONTINUING DISCLOSURE AGREEMENT

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

-1-

CONTINUING DISCLOSURE AGREEMENT

This CONTINUING DISCLOSURE AGREEMENT dated as of August 1, 2020 (the “Continuing Disclosure Agreement”), is executed and delivered by The Jenks Public Works Authority (the “Authority”) and BancFirst, Oklahoma City, Oklahoma, as dissemination agent (the “Dissemination Agent”).

RECITALS

1. This Continuing Disclosure Agreement is executed and delivered in connection with the

issuance by The Jenks Public Works Authority (the “Authority”) of $3,150,000.00 Utility System Revenue Bonds, Series 2020 (the “Bonds”), pursuant to a Bond Indenture dated as of August 1, 2020 between the Authority and BancFirst, Oklahoma City, Oklahoma, as trustee (the “Indenture”).

2. The Authority and the Dissemination Agent are entering into this Continuing Disclosure

Agreement for the benefit of the Beneficial Owners of the Bonds and in order to assist the Participating Underwriter in complying with Rule 15c2-12 of the Securities and Exchange Commission. The Authority is an “obligated person” with responsibility for continuing disclosure hereunder.

In consideration of the mutual covenants and agreements herein, the Authority and the

Dissemination Agent covenant and agree as follows:

Section 1. Definitions. In addition to the definitions set forth in the Indenture, which apply to any capitalized term used in this Continuing Disclosure Agreement unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:

“Annual Report” means any Annual Report filed by the Authority pursuant to, and as described

in, Section 2 of this Continuing Disclosure Agreement.

“Beneficial Owner” means any registered owner of any Bonds and any person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Bonds for federal income tax purposes.

“Dissemination Agent” means BancFirst, Oklahoma City, Oklahoma, acting in its capacity as

dissemination agent hereunder, or any successor Dissemination Agent designated in writing by the Authority.

“EMMA” means the Electronic Municipal Market Access system for municipal securities

disclosures established and maintained by the MSRB, which can be accessed at www.emma.msrb.org or such other location as may be designated in the future by the MSRB pursuant to the Rule.

“Financial Obligation” shall mean (i) debt obligation; (ii) derivative instrument entered into in

connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (iii) guarantee of (i) or (ii). The term “Financial Obligation” shall not include municipal securities (as defined in the Securities Exchange Act of 1934, as amended) as to which a final official statement (as defined in the Rule) has been provided to the MSRB consistent with the Rule.

-2-

“Fiscal Year” means the 12-month period beginning on July 1 and ending on June 30 or any other 12-month period selected by the Authority as the Fiscal Year of the Authority for financial reporting purposes.

“Material Events” means any of the events listed in Section 3(a) of this Continuing Disclosure

Agreement.

“MSRB” means the Municipal Securities Rulemaking Board, or any successor repository designated as such by the Securities and Exchange Commission in accordance with the Rule.

“Participating Underwriter” means any of the original underwriter(s) of the Bonds required to

comply with the Rule in connection with offering of the Bonds.

“Rule” means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time.

Section 2. Provision of Annual Reports.

(a) The Authority shall, or shall cause the Dissemination Agent to, not later than 180 days

after the end of the Authority’s Fiscal Year, commencing with the year ending June 30, 2020, file with the MSRB, through EMMA, the following financial information and operating data and certification (the “Annual Report”):

(1) Audited Financials: The financial statements of the Authority for the prior Fiscal

Year, prepared in accordance with accounting principles generally accepted in the United States of America. If audited financial statements are to be prepared but are not available by the time the Annual Report is required to be filed pursuant to this Section, the Annual Report shall contain unaudited financial statements, and the audited financial statements shall be filed in the same manner as the Annual Report promptly after they become available.

(2) Updated Financial Data: Each Annual Report shall add the immediately

preceding Fiscal Year’s information concerning the Authority’s revenue, expenditures, debt service requirements, and coverage ratio as provided in the table entitled “Comparative Revenue and Expenses” provided in the Official Statement for the Bonds.

Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues with respect to which the Authority is an “obligated person” (as defined by the Rule), which have been filed with the MSRB and are available through EMMA or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the MSRB on EMMA. The Authority shall clearly identify each such other document so included by reference.

The Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross-reference other information as provided in this Section. If the Authority’s Fiscal Year changes, it shall give notice of such change in the same manner as for a Material Event under Section 3 of this Continuing Disclosure Agreement.

-3-

(b) Not later than three (3) Business Days prior to the date specified in subsection (a) for providing the Annual Report to the MSRB, the Authority shall either (1) provide the Annual Report to the Dissemination Agent, with written instructions to file the Annual Report as specified in subsection (a), or (2) provide written notice to the Dissemination Agent that the Authority has filed the Annual Report with the MSRB or will do so prior to the deadline specified in subsection (a). The Dissemination Agent may rely conclusively on the certification of the Authority provided pursuant to subsection (a)(4) above that such Annual Report constitutes the Annual Report required to be furnished by the Authority hereunder and shall have no independent duty to review such Annual Report.

(c) If the Dissemination Agent has not received either an Annual Report with filing

instructions or a written notice from the Authority that it has filed an Annual Report with the MSRB by the date required in subsection (a), the Dissemination Agent shall send a notice to the MSRB in substantially the form attached as Exhibit A.

(d) The Dissemination Agent shall, unless the Authority has filed the Annual Report with the

MSRB, promptly following receipt of the Annual Report and instructions required in subsection (b) above, file the Annual Report with the MSRB and file a report with the Authority certifying that the Annual Report has been filed pursuant to this Continuing Disclosure Agreement, stating the date it was filed with the MSRB. Such confirmation may be in the form of any confirming email or submission confirmation obtained from EMMA.

(e) In addition to the foregoing requirements of this Section, the Authority agrees to provide

copies of the most recent Annual Report to any requesting bondowner or prospective bondowner, but only after the same have been delivered to the MSRB.

Section 3. Reporting of Material Events.

(a) No later than ten (10) Business Days after the occurrence of any of the following events,

the Authority shall give, or cause to be given to the MSRB by the Dissemination Agent, through EMMA, notice of the occurrence of any of the following events with respect to the Bonds (“Material Events”):

(1) principal and interest payment delinquencies; (2) non-payment related defaults, if material; (3) unscheduled draws on debt service reserves reflecting financial difficulties; (4) unscheduled draws on credit enhancements reflecting financial difficulties; (5) substitution of credit or liquidity providers, or their failure to perform; (6) adverse tax opinions; the issuance by the Internal Revenue Service of proposed

or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701- TEB) or other material notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds;

(7) modifications to rights of bondholders, if material; (8) bond calls, if material, and tender offers; (9) defeasances; (10) release, substitution or sale of property securing repayment of the Bonds, if

material; (11) rating changes; (12) bankruptcy, insolvency, receivership or similar event of the Authority or the City

of Jenks, Oklahoma (the “City”);

-4-

(13) the consummation of a merger, consolidation, or acquisition involving the Authority or the City or the sale of all or substantially all of the assets of the Authority or the City, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material;

(14) appointment of a successor or additional trustee or the change of name of the trustee, if material;

(15) incurrence of a Financial Obligation of the Authority or the City, if material, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a Financial Obligation of the Authority or the City, any of which affect bondholders, if material; and

(16) default, event of acceleration, termination event, modification of terms, or other similar events under the terms of a Financial Obligation of the Authority or the City, any of which reflect financial difficulties.

(b) The Dissemination Agent shall, promptly after obtaining actual knowledge of the

occurrence of any event that it believes may constitute a Material Event, contact the Chairman of the Authority or his or her designee, or such other person as the Authority shall designate in writing to the Dissemination Agent from time to time, inform such person of the event, and request that the Authority promptly notify the Dissemination Agent in writing whether or not to report the event pursuant to subsection (d). If in response to a request under this subsection (b), the Authority determines that the event does not constitute a Material Event, the Authority shall so notify the Dissemination Agent in writing and instruct the Dissemination Agent whether or not to report the occurrence pursuant to subsection (d).

(c) Whenever the Authority obtains knowledge of the occurrence of a Material Event,

because of a notice from the Dissemination Agent pursuant to subsection (b) or otherwise, the Authority shall promptly notify and instruct the Dissemination Agent in writing to report the occurrence pursuant to subsection (d).

(d) If the Dissemination Agent receives written instructions from the Authority to report the

occurrence of a Material Event, the Dissemination Agent shall promptly file a notice of such occurrence to the MSRB, with a copy to the Authority. Notwithstanding the foregoing, notice of Material Events described in subsections (a)(8) and (9) need not be given under this subsection any earlier than the notice (if any) of the underlying event is given to the registered owners of affected Bonds pursuant to the Indenture.

Section 4. Termination of Reporting Obligation. The Authority’s obligations under this

Continuing Disclosure Agreement shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. If the obligations of the Authority under this Continuing Disclosure Agreement are assumed in full by some other entity, such person shall be responsible for compliance with this Continuing Disclosure Agreement in the same manner as if it were the Authority, and the Authority shall have no further responsibility hereunder. If such termination or substitution occurs prior to legal defeasance, prior redemption or payment in full of all of the Bonds, the Authority shall give notice of such termination or substitution in the same manner as for a Material Event under Section 3 of this Continuing Disclosure Agreement.

-5-

Section 5. Dissemination Agents. The Authority may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Continuing Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent may resign as dissemination agent hereunder at any time upon 30 days prior written notice to the Authority. Except as otherwise provided herein, the Dissemination Agent shall not be responsible in any manner for the content of any notice or report (including without limitation the Annual Report) prepared by the Authority pursuant to this Continuing Disclosure Agreement. The initial Dissemination Agent is BancFirst, Oklahoma City, Oklahoma.

Section 6. Amendment; Waiver. Notwithstanding any other provision of this Continuing

Disclosure Agreement, the Authority and the Dissemination Agent may amend this Continuing Disclosure Agreement and any provision of this Continuing Disclosure Agreement may be waived, provided that Bond Counsel or other counsel experienced in federal securities law matters provides the Authority and the Dissemination Agent with its written opinion that the undertaking of the Authority contained herein, as so amended or after giving effect to such waiver, is in compliance with the Rule and all current amendments thereto and interpretations thereof that are applicable to this Continuing Disclosure Agreement.

In the event of any amendment or waiver of a provision of this Continuing Disclosure Agreement,

the Authority shall describe such amendment or waiver in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or, in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the Authority. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (1) notice of such change shall be given in the same manner as for a Material Event under Section 3 of this Continuing Disclosure Agreement, and the Annual Report for the year in which the change is made should present a comparison (in narrative form and also, if feasible, in quantitative form) between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles.

Section 7. Additional Information. Nothing in this Continuing Disclosure Agreement shall

be deemed to prevent the Authority from disseminating any other information, using the means of dissemination set forth in this Continuing Disclosure Agreement or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Material Event, in addition to that which is required by this Continuing Disclosure Agreement. If the Authority chooses to include any information in any Annual Report or notice of occurrence of a Material Event, in addition to that which is specifically required by this Continuing Disclosure Agreement, the Authority shall not have any obligation under this Continuing Disclosure Agreement to update such information or include it in any future Annual Report or notice of occurrence of a Material Event.

Section 8. Default. If the Authority or the Dissemination Agent fails to comply with any

provision of this Continuing Disclosure Agreement, any Participating Underwriter or any Beneficial Owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandamus or specific performance by court order, to cause the Authority or the Dissemination Agent, as the case may be, to comply with its obligations under this Continuing Disclosure Agreement. A default under this Continuing Disclosure Agreement shall not be deemed an event of default under the Indenture or the Bonds, and the sole remedy under this Continuing Disclosure Agreement in the event of any failure of the Authority or the Dissemination Agent to comply with this Continuing Disclosure Agreement shall be an action to compel performance.

-6-

Section 9. Duties and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Continuing Disclosure Agreement The fees, charges and expenses of the Dissemination Agent in connection with its administration of this Continuing Disclosure Agreement shall be paid as provided in the Indenture.

The Dissemination Agent shall not be responsible for the content of any notice or information

provided by the Authority to the Dissemination Agent for filing or the Authority’s failure to submit a complete Annual Report. The Dissemination Agent shall not be responsible for ensuring the compliance with any rule or regulation of the Authority or Participating Underwriter in connection with the filings of information herein, but is merely responsible for the filing of any such information provided to the Dissemination Agent by the Authority.

Section 10. Notices. Any notices or communications to or among any of the parties to this

Continuing Disclosure Agreement may be given by registered or certified mail, return receipt requested, or by confirmed facsimile, or delivered in person or by overnight courier, and will be deemed given on the second day following the date on which the notice or communication is so mailed, as follows:

To the Authority: The Jenks Public Works Authority

211 N. Elm Jenks, Oklahoma 74037 ATTN: Chairman of Trustees

To the Dissemination Agent: BancFirst

101 N. Broadway, Suite 800 Oklahoma City, Oklahoma 73102 ATTN: Corporate Trust Department

Any person may, by written notice to the other persons listed above, designate a different address

or telephone number(s) to which subsequent notices or communications should be sent.

Section 11. Beneficiaries. Subject to the limitation on remedies contained in Section 9 of this Continuing Disclosure Agreement, this Continuing Disclosure Agreement shall inure solely to the benefit of the Authority, the Dissemination Agent, the Participating Underwriter, and Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity.

Section 12. Severability. If any provision in this Continuing Disclosure Agreement, the

Indenture or the Bonds shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

Section 13. Counterparts. This Continuing Disclosure Agreement may be executed in

several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

Section 14. Electronic Transactions. The arrangement described herein may be conducted

and related documents may be stored by electronic means. Copies, telecopies, facsimiles, electronic files and other reproductions of original documents shall be deemed to be authentic and valid counterparts of such original documents for all purposes, including the filing of any claim, action or suit in the appropriate court of law.

-7-

Section 15. No Pecuniary Liability; General Limitation on Authority Obligations.

(a) Notwithstanding the language or implication of any provision, representation, covenant or agreement to the contrary, no provision, representation, covenant or agreement contained in this Continuing Disclosure Agreement or any obligation herein imposed upon the Authority, or the breach thereof, shall constitute or give rise to or impose upon the Authority a pecuniary liability. No provision hereof shall be construed to impose a charge against the general credit of the Authority or any personal or pecuniary liability upon any official, director, officer, agent, or employee of the Authority.

(b) ANY OTHER TERM OR PROVISION OF THIS CONTINUING DISCLOSURE

AGREEMENT OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION WITH THE TRANSACTION WHICH IS THE SUBJECT HEREOF TO THE CONTRARY NOTWITHSTANDING, THE AUTHORITY SHALL NOT BE REQUIRED TO TAKE OR OMIT TO TAKE, OR REQUIRE ANY OTHER PERSON OR ENTITY TO TAKE OR OMIT TO TAKE, ANY ACTION WHICH WOULD CAUSE IT OR ANY PERSON OR ENTITY TO BE, OR RESULT IN IT OR ANY PERSON OR ENTITY BEING, IN VIOLATION OF ANY LAW OF THE STATE OF OKLAHOMA.

Section 16. Governing Law. This Continuing Disclosure Agreement shall be governed by

and construed in accordance with the laws of the State of Oklahoma.

[Remainder of Page Intentionally Left Blank.]

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

S-1

IN WITNESS WHEREOF, the Authority and the Dissemination Agent have caused this Continuing Disclosure Agreement to be executed as of the day and year first above written.

THE JENKS PUBLIC WORKS AUTHORITY

By: Title: Chairman of Trustees

Continuing Disclosure Agreement

S-2

BancFirst, Oklahoma City, Oklahoma, as Dissemination Agent

By: Title: Authorized Officer

Continuing Disclosure Agreement

EXHIBIT A

NOTICE OF FAILURE TO FILE ANNUAL REPORT

Name of Issuer: The Jenks Public Works Authority (the “Authority”)

Name of Bond Issue: $3,150,000.00 Utility System Revenue Bonds, Series 2020

Name of Obligated Person: The Jenks Public Works Authority

Date of Issuance: August 28, 2020

NOTICE IS HEREBY GIVEN that the Authority has not filed an Annual Report with respect to the above-named Bonds as required by the Continuing Disclosure Agreement dated as of August 1, 2020, between the Authority and BancFirst, Oklahoma City, Oklahoma, as Dissemination Agent. The Authority has informed the Dissemination Agent that the Authority anticipates that the Annual Report will be filed by _____________________.

Dated: _____________, _____.

BancFirst, Oklahoma City, Oklahoma, as Dissemination Agent on behalf of The Jenks Public Works Authority

cc: The Jenks Public Works Authority

A–1

THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.