GENESEE INTERMEDIATE SCHOOL DISTRICT. REPORT ON FINANCIAL STATEMENTS (with required supplementary and additional supplementary information)

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1 REPORT ON FINANCIAL STATEMENTS (with required supplementary and additional supplementary information) JUNE 30, 2017

2 TABLE OF CONTENTS Independent Auditor s Report Management s Discussion and Analysis PAGE I - II III - IX Basic Financial Statements Government-wide Financial Statements: Statement of Net Position Statement of Activities Fund Financial Statements: Balance Sheet Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds Statement of Net Position Proprietary Funds Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds Statement of Cash Flows Proprietary Funds Fiduciary Fund Statement of Fiduciary Assets and Liabilities Notes to the Financial Statements 9 30 Required Supplementary Information Budgetary Comparison Schedules: General Fund Special Education Fund Career Technical Education Fund Special Education Capital Projects Fund Schedule of the Reporting Unit's Proportionate Share of the Net Pension Liability Schedule of the Reporting Unit's Contributions Notes to Required Supplementary Information Additional Supplementary Information Combining Statements Nonmajor Governmental Funds: Combining Balance Sheet Combining Statement of Revenues, Expenditures and Changes in Fund Balances 38 39

3 TABLE OF CONTENTS (Continued) PAGE Individual Schedules of Revenues, Expenditures and Other Financing Sources and Uses: Schedule 1 General Fund - Schedule of Revenues and Other Financing Sources 40 Schedule 2 Special Education Fund - Schedule of Revenues and Other Financing Sources 41 Schedule 3 Career Technical Education Fund - Schedule of Revenues and Other Financing Sources 42 Schedule 4 General Fund - Schedule of Expenditures and Other Financing Uses Schedule 5 Special Education Fund - Schedule of Expenditures and Other Financing Uses Schedule 6 Career Technical Education Fund - Schedule of Expenditures and Other Financing Uses Schedule 7 Trust and Agency Fund Schedule of Receipts and Disbursements - Other Groups Schedule 8 - Schedule of Bond Principal and Interest Requirements 55 Schedule of Expenditures of Federal Awards Notes to Schedule of Expenditures of Federal Awards 60 Reconciliation of "Grant Auditor's Report" to the Schedule of Expenditures of Federal Awards 61 Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based Upon an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Report on Compliance for Each Major Federal Award Program and on Internal Control Over Compliance Required by the Uniform Guidance Schedule of Findings and Questioned Costs 66 Schedule of Prior Year Audit Findings 66 Schedule of Expenditures of Federal Awards Provided to Subrecipients 67 73

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6 MANAGEMENT DISCUSSION AND ANALYSIS As administration of Genesee Intermediate School District, we offer readers of the District s financial statements this narrative overview and analysis of the financial activities of the District for the fiscal year ended June 30, Financial Highlights * The liabilities and deferred inflows of the District exceeded its assets and deferred outflows at the close of the most recent fiscal year by $19,381,486 (net position). * The District s total net position increased by $12,747,365. The increase was primarily due to increases in grant funding related to the ongoing Flint Water Crisis, the additional millage levied for Genesee Opportunity, as well as overall increases of District assets. Governmental Activities * The general fund had an increase in fund balance of $2,155,794. Total fund balance for the general fund was $8,716,668, or 17%, of total general fund expenditures. * The special education fund had an increase in fund balance of $1,391,255. Total fund balance for the special education fund was $10,873,675, or 14%, of total special education fund expenditures. * The vocational education fund had an increase in fund balance of $768,243. Total fund balance for the vocational education fund was $5,728,946, or 36%, of total vocational education fund expenditures. Business-Type Activities * The general local district services fund had an decrease in fund balance of $305,348. Total net position for the general local district services fund was ($2,153,148). * The special education local district services fund had an increase in fund balance of $710,059. Total net position for the special education district services fund was ($2,071,572). Using this Annual Report This annual report consists of a series of financial statements and notes to those statements. The statements are organized so the reader can understand the District financially as a whole. The District-Wide Financial Statements provide information about the activities of the whole School District, presenting both an aggregate view of the School District s finances and a longer-term view of those finances. The financial statements then proceed to provide an increasingly detailed look at specific financial activities included in the fund financial statements. For governmental activities, these statements tell how services were financed in the short-term as well as what remains for future spending. The fund financial statements provide information about the School District s most significant funds - the General Fund, Special Education Fund, Vocational Education Fund, and Special Education Capital Projects Fund. All other funds are presented in one column as non-major funds. Reporting the District as a Whole The Statement of Net Position and Statement of Activities - One of the most important questions asked about the District s finances is, Is the District better off or worse off as a result of the year s activities? The statement of net position and the statement of activities, which appear first in the School District s financial statements, report information about the District as a whole and about its activities in a manner that helps to answer this question. These statements include all assets and liabilities of the District using the accrual basis of accounting, which is similar to the accounting used by private-sector corporations. However, the School District s goal is to provide services to our students, not to generate profits as private-sector corporations do. All of the current year s revenues and expenses are taken into consideration regardless of when cash is received or paid. -III-

7 MANAGEMENT DISCUSSION AND ANALYSIS Reporting the District as a Whole (Continued) The statement of net position and the statement of activities present information about the following: Governmental Activities - All of the District's basic services are considered to be governmental activities, including instruction, support services, community services, food services, and transfers to other local districts. Property taxes, intergovernmental revenues (unrestricted and restricted State Aid), and charges for services finance most of these activities. These two statements report the District's net position and changes therein. The change in net position provides the reader a tool to assist in determining whether the District's financial health is improving or deteriorating. The reader will need to consider other nonfinancial factors such as property tax base, political conditions at the State Capitol, student enrollment growth, birth rates, and facility conditions in arriving at their conclusion regarding the overall health of the District. Proprietary funds Consists of county-wide interactive voice, data and video network (GENNET), shared services for technology, business, and custodial, energy savings consortium, Interactive Television (ITV) and online courses, transportation services for special education students in the county and transportation services for vocational education students in the county to and from the Genesee Career Institute. The government-wide financial statements can be found on pages 1-2 of this report. Reporting the District's Most Significant Funds Fund Financial Statements - The fund financial statements provide detailed information about the most significant funds - not the District as a whole. The fund financial statements begin on page 3 and provide detailed information about the most significant funds. The fund statements are formatted to comply with the legal requirements of the Michigan Department of Education's "Accounting Manual." The District's two types of funds: governmental funds and fiduciary funds use different accounting approaches as further discussed in the notes to the financial statements. In the fund financial statements, capital assets purchased by cash are reported as expenditures in the year of acquisition. No asset is reported. The issuance of debt is recorded as a financial resource. The current year's payments of principal and interest on long-term obligations are recorded as expenditures. Future year's debt obligations are not recorded. Governmental Funds - Most of the District's activities are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end available for spending in future periods. These funds are reported using an accounting method called modified accrual accounting, which measures cash and other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the District's general government operations and the basic services it provides. Governmental fund information helps you determine whether there are more or less financial resources available to spend in the near future to finance the District's programs. The relationship (or differences) between governmental activities (reported in the Statement of Net position and the Statement of Activities) and governmental funds is reconciled in the basic financial statements. The basic governmental fund financial statements can be found on pages 3 and 4 of this report. Proprietary Funds - use the accrual basis of accounting, the same as on the government-wide statements, therefore the statements will essentially match the business-type activities portion of the government-wide statements. The financial statements can be found on page 5-7 of this report. Fiduciary Funds - The District is the fiduciary for various student group activities. We exclude these activities from the District's other financial statements because the assets cannot be utilized by the District to finance its operations. The District's fiduciary activities are reported in a separate Statement of Fiduciary Net Assets. The basic fiduciary fund financial statement can be found on page 8 of this report. Additional Information - The notes to financial statements provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to financial statements can be found on pages 9-30 of this report. -IV-

8 MANAGEMENT DISCUSSION AND ANALYSIS SUMMARY OF NET POSITION: (IN MILLIONS) GOVERNMENTAL BUSINESS-TYPE ACTIVITIES ACTIVITIES TOTAL Assets Other Assets $76.3 $57.4 $9.1 $8.6 $85.4 $66.0 Capital Assets Total Assets $107.2 $85.8 $13.3 $12.5 $120.5 $98.3 Deferred Outflows of Resources Total Assets and Deferred Outflows of Resources $121.3 $97.3 $16.2 $14.8 $137.5 $112.1 Liabilities Other Liabilities Long-Term Liabilities Total Liabilities $136.6 $122.2 $19.8 $18.6 $156.4 $140.8 Deferred Inflows of Resources Total Liabilities and Deferred Inflows of Resources $137.1 $125.0 $19.8 $19.2 $156.9 $144.2 Net Position Net Investment in Capital Assets Restricted Unrestricted (40.6) (63.0) (7.8) (8.3) (48.4) (71.3) TOTAL NET POSITION ($15.7) ($27.7) ($3.6) ($4.4) ($19.3) ($32.1) The above analysis focuses on the net position. The change in net position of the School District s governmental activities is discussed below. The net position differs from fund balances and the reconciliation appears on page 3. The District s net position reflects its investment in capital assets, and capital projects (i.e. land, buildings, vehicles, equipment, and infrastructure), less any related debt used to acquire those assets that are still outstanding. The District uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the District s investment in its capital assets is reported net of related debt, it should be noted that the resources to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. -V-

9 MANAGEMENT DISCUSSION AND ANALYSIS SUMMARY OF NET POSITION: (Continued) An additional portion of the District s net position, $1.7 million, represents resources that are subject to external restrictions on how they may be used. In the case of the School District, these amounts are restricted for genesee opportunity and food service. The results of this year s operations for the School District as a whole are reported in the statement of activities (see table above), which shows the changes in net position for fiscal year RESULTS OF OPERATIONS: For the fiscal years ended June 30, 2017 and 2016, the District wide results of operations were: (IN MILLIONS) GOVERNMENTAL BUSINESS-TYPE ACTIVITIES ACTIVITIES TOTAL Revenues: Program Revenues: Charges for Services $1.6 $1.4 $21.5 $21.4 $23.1 $22.8 Operating Grants and Contributions General Revenues: 0.0 Property Taxes Grants and State Aid Other Total Revenues $145.5 $137.8 $22.6 $22.2 $168.1 $160.0 Functions/Program Expenses Instruction Support Services Community Services Depreciation and Other Local District Services Total Expenses $101.8 $101.5 $21.8 $22.2 $123.6 $123.7 Excess Before Transfers $43.7 $36.3 $0.8 $0.0 $44.5 $36.3 Transfers to Local Districts Change in Net Position $12.0 $4.9 $0.8 $0.0 $12.8 $4.9 -VI-

10 MANAGEMENT DISCUSSION AND ANALYSIS RESULTS OF OPERATIONS: (Continued) The District s net position increased by $12.8 million during the current fiscal year. The increase in net position differs from the change in fund balances and the reconciliation appears on page 4. The net cost shows the financial burden that was placed on the State and the School District s taxpayers by each of these functions. Since property taxes for operations and unrestricted State aid constitute the vast majority of the School District s operating revenue sources, the Board of Education and Administration must annually evaluate the needs of the School District and balance those needs with State-prescribed available unrestricted resources. Budgeting and Operating Highlights The School District s budgets are prepared according to Michigan law. The most significant budgeted funds are the General Fund, Special Education Fund and Career Technical Education Fund. During the fiscal year ended June 30, 2017, the School District amended the budgets of the General Fund, Special Education and Vocational Education three times. State law requires that the budget be amended to ensure that expenditures do not exceed appropriation. A schedule showing the School District s General Fund, Special Education Fund and Vocational Education Fund original and final budget amounts compared with amounts actually paid and received is provided in required supplemental information of these financial statements. General Fund The general fund actual revenue and other financing sources was $51.8 million. The amount is less than the final budget estimate of $53.1 million. The variance was $1.3 million, or 2%. The variance is primarily due to aligning grant revenue for Flint Water Emergency Nutrition Program, Section 107 Adult Education Participation, Great Start Readiness Program, Title I, Investing In Innovation (I3), and Head Start Supplemental Funds. The actual expenditures and other financing uses of the general fund was $49.6 million, which is below the final budget estimate of $51.4 million. The variance was $1.8 million, or 4%. The variance is primarily due to aligning grant expenditures for Flint Water Emergency Nutrition Program, Section 107 Adult Education Participation, Great Start Readiness Program, Title I, Investing In Innovation (I3), Head Start Supplemental Funds, and an increase in indirect costs recovery which reduces expenditures. The general fund had total revenues of $51.8 million and total expenditures of $49.6 million with a net increase in fund balance of $2.2 million and an ending fund balance of $8.7 million. Special Education Fund The special education fund actual revenue and other financing sources was $76.5 million. The amount is less than the final budget estimate of $76.6 million. The variance was $200 thousand, or less than 1%. The actual expenditures and other financing uses of the special education fund was $75.1 million, which is below the final budget estimate of $76.2 million. The variance was $1.1 million, or 2%. The variance was primarily due to to aligning grant expenditures for Flint Water Emergency, Early On, IDEA Flowthrough, and Preschool. The special education fund had total revenues of $76.5 million and total expenditures of $75.1 million with a net increase in fund balance of $1.4 million and an ending fund balance of $10.9 million. -VII-

11 MANAGEMENT DISCUSSION AND ANALYSIS Budgeting and Operating Highlights (Continued) Vocational Education Fund The vocational education fund actual revenue and other financing sources was $16.9 million. The amount is more than the final budget estimate of $16.7 million. The variance was $200 thousand, or less than 1%. The actual expenditures and other financing uses of the vocational education fund was $16.1 million, which is below the final budget estimate of $16.1 million. The variance was $19 thousand, or less than 1%. The vocational education fund had total revenues of $16.9 million and total expenditures of $16.1 million with a net increase in fund balance of $800 thousand and an ending fund balance of $5.7 million. Capital Asset and Debt Administration A. Capital Assets The District s investment in capital assets for its governmental activities as of June 30, 2017 amounted to $30.9 million (net of accumulated depreciation). This investment in capital assets included land, building, land improvements, machinery and equipment, and licensed vehicles. Capital assets at fiscal year-end included the following: Capital Assets (Net of Depreciation) Land $186,167 $186,167 Buildings and Improvements 18,909,326 6,512,612 Land Improvements 9,849,432 10,449,489 Furniture and Equipment 1,177,014 1,032,724 Vehicles 745, ,887 Total capital assets, net $30,866,968 $18,719,879 The District s investment in capital assets for its business-type activities as of June 30, 2017 amounted to $4.2 million (net of accumulated depreciation). This investment in capital assets included furniture, equipment and buses. Capital assets at fiscal year-end included the following: Capital Assets (Net of Depreciation) Furniture and Equipment $769,650 $773,359 Buses 3,449,556 3,126,922 Total capital assets, net $4,219,206 $3,900,281 Additional information on the District s capital assets can be found in Note 5. -VIII-

12 MANAGEMENT DISCUSSION AND ANALYSIS B. Debt At the end of the current fiscal year, the District had total long-term debt outstanding of $8.2 million. Long-term debt at fiscal year-end included the following: Governmental Business-Type Bonds Payable $7,555,000 $7,780,000 $0 $0 Bond Premium 141, , Sick & Severance Pay 490, , , ,932 Total Long-Term Debt $8,187,192 $8,398,150 $124,670 $110,932 Additional information on the District s long-term debt can be found in Note 7. Economic Factors and Next Year s Budget The following factors will affect the District in the future and were considered in preparing the District's budget for the fiscal year: * Foundation Allowance The foundation allowance for is budgeted to remain flat. * Retirement Rate The continuing cost of health insurance to current and potential retirees continues to drive the rate increase the Michigan School Employees Retirement System recommends to the legislature for approval. In , the rate is anticipated to increse to 25.56% for the fiscal year. Additionally, the District will be required to pay 11.32%, for all wages earned October 1, 2017 and later, for the Unfunded Actuarial Accrued Liability (UAAL). Additional funding through state aid Section 147c MPSERS UAAL Stabilization is projected to assist with the increased retirement rate, although the annual reconciliation recognized a $428,000 shortfall in expenses in comparison to the amount of Section 147c funds received. * The Genesee Intermediate School District 2017/2018 adopted budget is as follows: General Special Ed. Career Tech. Total REVENUE $47,395,876 $82,784,572 $15,466,795 $145,647,243 EXPENDITURES 47,849,717 81,365,436 15,189, ,404,762 NET OVER (UNDER) BUDGET ($453,841) $1,419,136 $277,186 $1,242,481 CONTACTING THE DISTRICT S FINANCIAL MANAGEMENT This financial report is designed to provide a general overview of the Genesee Intermediate School District s finances for all those with an interest in the government s finances. Questions concerning any of the information provided in this report or requests for additional information should be addressed to: Cynthia McCain Assistant Superintendent for Business Genesee Intermediate School District 2413 West Maple Avenue, Flint, Michigan Fax (810) , Office Telephone (810) or - cmccain@geneseeisd.org -IX-

13 BASIC FINANCIAL STATEMENTS

14 STATEMENT OF NET POSITION JUNE 30, 2017 Governmental Business-Type Activities Activities Total ASSETS Cash and Cash Equivalents $33,084,446 $6,728,058 $39,812,504 Investments 17,838, ,838,708 Accounts Receivable 2,659,225 2,240,284 4,899,509 Taxes Receivable 7, ,024 Due from Other Governmental Units 22,177, ,177,776 Prepaid Expenditures 528, , ,327 Capital Assets, Not Being Depreciated - Construct. in Progress 73, ,223 Capital Assets, Not Being Depreciated - Land 186, ,167 Capital Assets, Net of Accumulated Depreciation 30,680,801 4,219,206 34,900,007 TOTAL ASSETS $107,235,808 $13,342,437 $120,578,245 DEFERRED OUTFLOWS OF RESOURCES Related to Pensions 14,121,594 2,913,679 17,035,273 TOTAL ASSETS AND DEFERRED OUTFLOWS OF RESOURCES $121,357,402 $16,256,116 $137,613,518 LIABILITIES Accounts Payable 13,188, ,605 13,434,508 Due to Other Governmental Units 1,150, ,150,646 Salaries Payable 2,769, ,769,599 Accrued Expenditures 893, ,764 Unearned Revenue 16,331, ,331,627 Long-Term Obligations - Due in One Year 246, ,493 Long-Term Obligations - Due in More than One Year 7,940, ,670 8,065,369 Net Pension Liability 94,123,215 19,420, ,543,457 TOTAL LIABILITIES $136,644,878 $19,790,585 $156,435,463 DEFERRED INFLOWS OF RESOURCES Related to Pensions 463,838 95, ,541 TOTAL LIABILITIES AND DEFERRED INFLOWS OF RESOURCES $137,108,716 $19,886,288 $156,995,004 NET POSITION Net Investment in Capital Assets 23,203,023 4,219,206 27,422,229 Restricted 1,688, ,688,177 Unrestricted (40,642,514) (7,849,378) (48,491,892) TOTAL NET POSITION ($15,751,314) ($3,630,172) ($19,381,486) See notes to the financial statements. -1-

15 STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2017 Net (Expense) Revenue and Program Revenues Changes in Net Position Program Specific Operating Charges For Grants and Governmental Business-Type FUNCTIONS/PROGRAMS Expenses Services Contributions Activities Activities Total Governmental Activities Instruction $38,668,140 $0 $0 ($38,668,140) $0 ($38,668,140) Support Services 60,114,072 1,555,212 44,330,371 (14,228,489) 0 (14,228,489) Community Services 883, (883,339) 0 (883,339) Outgoing Transfers and Other Uses 326, (326,537) 0 (326,537) Transfers to Local Districts 31,728, ,195,881 (15,532,287) 0 (15,532,287) Food Service 316,574 32,938 0 (283,636) 0 (283,636) Depreciation - Unallocated 1,480, (1,480,376) 0 (1,480,376) Total Governmental Activities $133,517,206 $1,588,150 $60,526,252 ($71,402,804) $0 ($71,402,804) Business-Type Activities: Local District Services 21,828,064 21,473, (354,712) (354,712) TOTALS $155,345,270 $23,061,502 $60,526,252 ($71,402,804) ($354,712) ($71,757,516) General Revenues: Property Taxes, Levied for General Purposes 3,819, ,819,431 Property Taxes, Levied for Special Education Purpose 22,454, ,454,942 Property Taxes, Levied for Career Technical Education Purpose 8,978, ,978,801 State Aid 38,817, ,817,943 Interdistrict Sources 6,077, ,077,770 Grants and Contributions Not Restricted to Specific Programs 371, ,734 Investment Earnings 226, ,350 Miscellaneous 2,621,318 1,136,592 3,757,910 Total General Revenues and Transfers $83,368,289 $1,136,592 $84,504,881 Change in Net Position $11,965,485 $781,880 $12,747,365 Net Position - Beginning of Year - As Restated (27,716,799) (4,412,052) (32,128,851) Net Position - End of Year ($15,751,314) ($3,630,172) ($19,381,486) See notes to the financial statements -2-

16 BALANCE SHEET GOVERNMENTAL FUNDS JUNE 30, 2017 Career Special Special Technical Education General Education Education Capital Fund Fund Fund Projects ASSETS Cash and Cash Equivalents $4,756,088 $5,929,192 $5,658,043 $8,890,551 Investments 4,133,486 12,717, ,913 0 Receivables: Accounts Receivable 2,491, ,754 28,644 0 Taxes Receivable 767 4,470 1,787 0 Due From Other Governmental Units 9,087,826 11,968,638 1,073,801 0 Prepaid Expenditures 351, ,184 5,166 0 TOTAL ASSETS $20,821,728 $30,854,547 $7,755,354 $8,890,551 LIABILITIES Accounts Payable $5,471,787 $6,109,480 $1,425,922 $7,236 Due to Other Governmental Units 828, ,639 45,808 0 Salaries Payable 427,272 1,925, ,953 0 Accrued Expenditures 86, , ,725 0 Unearned Revenue 5,291,473 11,040, Total Liabilities $12,105,060 $19,980,872 $2,026,408 $7,236 FUND BALANCES Non-Spendable Prepaid Expenditures 351, ,184 5,166 0 Committed Capital Projects ,883,315 Restricted Genesee Opportunity 1,573, School Service Special Education 0 10,754, Career Technical Education 0 0 5,723,780 0 Assigned 1,331, Unassigned 5,459, Total Fund Balances $8,716,668 $10,873,675 $5,728,946 $8,883,315 TOTAL LIABILITIES AND FUND BALANCES $20,821,728 $30,854,547 $7,755,354 $8,890,551 See notes to the financial statements. -3-

17 RECONCILIATION OF TOTAL GOVERNMENTAL FUND BALANCES TO NET POSITION OF GOVERNMENTAL ACTIVITIES JUNE 30, 2017 Total Governmental Fund Balances: $42,001,563 Non-Major Total Amounts reported for governmental activities in the statement of Governmental Governmental net position are different because: Funds Funds Deferred Outflows of Resources - Related to Pensions 14,121,594 Deferred Inflows of Resources - Related to Pensions (463,838) $7,850,572 $33,084, ,838,708 Capital assets used in governmental activities are not financial resources and therefore are not reported as assets in governmental funds 22,913 2,659,225 Capital Assets $55,372, ,024 Less: Acccumulated Depreciation (24,505,707) 47,511 22,177,776 Capital Assets, Net of Accumulated Depreciation 30,866,968 52, ,438 Construction in Progress 73,223 $7,973,437 $76,295,617 Accrued Interest on Long-Term Debt (40,417) $174,478 $13,188,903 Long-term liabilities, including bonds payable, are not due and 0 1,150,646 payable in the current period and therefore are not reported as 0 2,769,599 liabilities in the funds. Long-term liabilities at year end consist of: 0 853, ,331,559 Compensated Absences Payable $490,441 $174,478 $34,294,054 Bonds Payable 7,555,000 Premium on Bonds 141,751 Total (8,187,192) 52, ,438 Net Pension Liability (94,123,215) 7,631,964 16,515,279 TOTAL NET POSITION - GOVERNMENTAL ACTIVITIES ($15,751,314) 0 1,573, , , ,754, ,723, ,331, ,459,431 $7,798,959 $42,001,563 $7,973,437 $76,295,617

18 STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2017 Career Special Special Technical Education General Education Education Capital Fund Fund Fund Projects REVENUES Local Sources $6,669,701 27,788,465 $9,315,172 $5,389 State Sources 24,263,362 30,051,808 5,122,327 0 Federal Sources 15,256,826 18,008,363 1,264,815 0 Interdistrict Sources 5,475, , Total Revenues $51,665,860 $76,450,435 $15,702,314 $5,389 EXPENDITURES Instruction 14,707,736 19,945,373 5,069,303 0 Student Services 3,486,707 13,416, ,980 0 Instructional Staff 9,184,418 1,489,064 1,937,061 0 General Administration 1,039, ,901 88,392 0 School Administration 722,809 1,302, ,411 0 Business Administration 1,166,665 1,368, ,274 0 Operation & Maintenance 1,818,766 1,761,381 1,186,245 0 Transportation 1,416,919 7,566, ,631 0 Support Services - Other 6,075,311 3,484, ,842 0 Community Services 881,061 2, Outgoing Transfers and Other Uses 0 79, ,490 0 Food Service Capital Outlay ,502 Total Expenditures $40,500,368 $50,871,054 $11,168,629 $378,502 Excess (Deficiency) of Revenues Over (Under) Expenditures $11,165,492 $25,579,381 $4,533,685 ($373,113) OTHER FINANCING SOURCES (USES) Transfers (to) Local Districts (8,575,322) (21,008,784) (2,144,062) 0 Transfers In From Other Funds 8, ,200,000 Transfers Out to Other Funds (546,000) (3,200,000) (2,776,500) 0 Other Transfers 103,273 20,658 1,155,120 0 Total Other Financing Sources (Uses) ($9,009,698) ($24,188,126) ($3,765,442) $3,200,000 Net Change in Fund Balance $2,155,794 $1,391,255 $768,243 $2,826,887 FUND BALANCE - BEGINNING OF YEAR 6,560,874 9,482,420 4,960,703 6,056,428 FUND BALANCE - END OF YEAR $8,716,668 $10,873,675 $5,728,946 $8,883,315 See notes to the financial statements. -4-

19 RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2017 Total net change in fund balances - governmental funds $6,627,644 Non-Major Total Governmental Governmental Amounts reported for governmental activities in the statement of Funds Funds activities are different because: $62,451 $43,841,178 Governmental funds report capital outlays as expenditures. 1,315 59,438,812 However, in the statement of activities, the cost of those assets is 315,876 34,845,880 allocated over their estimated useful lives as depreciation expense. 0 6,077,770 Capital Outlay $13,627,465 $379,642 $144,203,640 Depreciation Expense (1,480,376) Total 12,147, ,722,412 Construction in Progess (9,592,352) 0 17,214, ,610,543 Principal Payments on Bonds 225, ,583, ,716,427 Amortization of Bond Premium 11, ,718, ,766,392 Change in accrued interest on long-term liabilities ,856, ,916,427 (Increase) in accrued compensated absences (25,536) 0 883, ,287 Some expenses reported in the statement of activities do not require the use of 316, ,574 current financial resources and, therefore, are not reported as expenditures in 3,891,752 4,270,254 the governmental Funds. $4,208,326 $107,126,879 Pension Related Items 2,571,396 ($3,828,684) $37,076,761 CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIES $11,965,485 0 (31,728,168) 3,322,500 6,530,851 (8,351) (6,530,851) 0 1,279,051 $3,314,149 ($30,449,117) ($514,535) $6,627,644 8,313,494 35,373,919 $7,798,959 $42,001,563

20 STATEMENT OF NET POSITION PROPRIETARY FUNDS JUNE 30, 2017 Non-Major Special Career General Education Tech Education Local District Local District Local District Services Services Services Total ASSETS CURRENT ASSETS Cash $1,717,590 $4,066,645 $943,823 $6,728,058 Accounts Receivable 1,809, ,409 68,580 2,240,284 Prepaid Expenditures 154, ,889 Total Current Assets $3,681,774 $4,429,054 $1,012,403 $9,123,231 NON-CURRENT ASSETS Capital Assets: Equipment 13,365, ,365,496 Buses and Vehicles 15,995 10,219,734 1,343,600 11,579,329 Less Accumulated Depreciation (12,611,841) (7,137,736) (976,042) (20,725,619) Total Noncurrent Assets $769,650 $3,081,998 $367,558 $4,219,206 TOTAL ASSETS $4,451,424 $7,511,052 $1,379,961 $13,342,437 DEFERRED OUTFLOWS OF RESOURCES Related to Pensions 1,121,170 1,657, ,609 2,913,679 TOTAL ASSETS AND DEFERRED OUTFLOWS OF RESOURCES $5,572,594 $9,168,952 $1,514,570 $16,256,116 LIABILITIES CURRENT LIABILITIES Accounts Payable 128, ,125 10, ,605 Unearned Revenue Total Current Liabilities $128,772 $106,125 $10,776 $245,673 NON-CURRENT LIABILITIES Pension Liability 7,472,818 11,050, ,193 19,420,242 Compensated Absences 87,326 29,713 7, ,670 Total Non-Current Liabilities $7,560,144 $11,079,944 $904,824 $19,544,912 DEFERRED INFLOWS OF RESOURCES Related to Pensions 36,826 54,455 4,422 95,703 TOTAL LIABILITIES AND DEFERRED INFLOWS OF RESOURCES $7,725,742 $11,240,524 $920,022 $19,886,288 NET POSITION NET POSITION Net Investment in Capital Assets 769,650 3,081, ,558 4,219,206 Unrestricted (2,922,798) (5,153,570) 226,990 (7,849,378) TOTAL NET POSITION ($2,153,148) ($2,071,572) $594,548 ($3,630,172) See notes to the financial statements -5-

21 STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION PROPRIETARY FUNDS YEAR ENDED JUNE 30, 2017 Non-Major Special Career General Education Tech Education Local District Local District Local District Services Services Services Total OPERATING REVENUES Charges for Services $10,579,149 $9,893,203 $1,001,000 $21,473,352 Other Miscellaneous Revenue 503, ,168 48,554 1,041,592 Total Operating Revenues $11,083,019 $10,382,371 $1,049,554 $22,514,944 OPERATING EXPENSES Salaries & Wages 2,719,426 4,130, ,871 7,186,399 Employee Benefits 1,813,572 3,107, ,082 5,153,737 Purchased Services 5,442,641 1,157, ,018 6,715,408 Supplies & Materials 117,923 1,271, ,763 1,539,965 Capital Outlay 12, ,203 Other Expenses 546,747 5,136 1, ,220 Depreciation Expense 113, ,260 39, ,963 Pension (Revenue) Expense 622,768 (501,297) (109,302) 12,169 Total Operating Expenses $11,388,367 $9,672,312 $767,385 $21,828,064 Net Operating Revenue (Expense) ($305,348) $710,059 $282,169 $686,880 OTHER FINANCING SOURCES Incoming Transfer from CTE ,000 95,000 Net Revenue (Expense) ($305,348) $710,059 $377,169 $781,880 NET POSITION - BEGINNING OF YEAR (1,847,800) (2,781,631) 217,379 (4,412,052) NET POSITION - END OF YEAR ($2,153,148) ($2,071,572) $594,548 ($3,630,172) See notes to the financial statements. -6-

22 STATEMENT OF CASH FLOWS PROPRIETARY FUNDS YEAR ENDED JUNE 30, 2017 Non-Major Special Career General Education Tech Education Local District Local District Local District Services Services Services Total CASH FLOWS FROM OPERATING ACTIVITIES Receipts from Local Districts $11,044,468 $10,438,884 $983,136 $22,466,488 Receipts from Other Sources 502, , ,554 1,134,758 Payments to Suppliers (6,120,557) (2,458,939) (271,584) (8,851,080) Payments to Employees (4,556,604) (7,207,472) (562,322) (12,326,398) Net Cash Provided By Operating Activities $869,343 $1,261,641 $292,784 $2,423,768 CASH FLOWS FROM INVESTING AND RELATED FINANCING ACTIVITIES Purchases of Capital Assets (109,378) (864,510) 0 (973,888) NET INCREASE IN CASH AND CASH EQUIVALENTS $759,965 $397,131 $292,784 $1,449,880 BALANCES - BEGINNING OF YEAR 957,625 3,669, ,039 5,278,178 BALANCES - END OF YEAR $1,717,590 $4,066,645 $943,823 $6,728,058 Reconciliation of Operating Income (Loss) to Net Cash Provided (Used) By Operating Activities Operating Income (Loss) ($305,348) $710,059 $377,169 $781,880 Adjustments to Reconcile Operating Income to Net Cash Provided By (Used In) Operating Activities: Depreciation Expense 113, ,260 39, ,963 Change in Assets and Liabilities: Receivables 465, ,681 (17,864) 993,068 Inventory 10, ,599 Prepaids (76,230) 0 0 (76,230) Compensated Absences (23,606) 29,713 7,631 13,738 Payables 64,588 (24,775) (4,466) 35,347 Pension Related Assets & Liabilities 622,768 (501,297) (109,302) 12,169 Accrued Expenses (1,834) 0 0 (1,834) Net Cash Provided By Operating Activities $869,343 $1,261,641 $292,784 $2,423,768 See notes to the financial statements. -7-

23 STATEMENT OF FIDUCIARY ASSETS AND LIABILITIES JUNE 30, 2017 Trust & Agency ASSETS Cash and Cash Equivalents $255,074 TOTAL ASSETS $255,074 LIABILITIES Due to Student Groups $254,309 Due to Employee Groups 765 TOTAL LIABILITIES $255,074 See notes to the financial statements. -8-

24 NOTES TO FINANCIAL STATEMENTS 1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A) DESCRIPTION OF GOVERNMENT-WIDE FINANCIAL STATEMENTS The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the nonfiduciary activities of the District. All fiduciary activities are reported only in the fund financial statements. Governmental activities normally are supported by taxes, intergovernmental revenues, and other nonexchange transactions. B) REPORTING ENTITY The District is governed by an elected five-member Board of Education. The accompanying basic financial statements have been prepared in accordance with criteria established by the GASB for determining the various governmental organizations to be included in the reporting entity. These criteria include significant operational financial relationships that determine which of the governmental organizations are part of the District s reporting entity and which organizations are legally separate component units of the District. Based on application of the criteria, the District does not contain component units. The District receives funding from local, state, federal and interdistrict government sources and must comply with the accompanying requirements of these funding source entities. However, the District is not included in any other governmental "reporting entity" body that has separate legal standing and is fiscally independent of the governmental entities. As such, the Board of Education has decision-making authority, the authority to levy taxes, and determine its budget, the power to designate management, the ability to significantly influence operations and primary accountability for fiscal matters. C) BASIS OF PRESENTATION Government-wide Financial Statements The statement of net assets and the statement of activities display information about the School District as a whole. These statements include the financial activities of the primary government, except for fiduciary funds. The statements distinguish between those activities of the School District that are governmental and those that are considered business-type activities. The government-wide statements are prepared using the economic resources measurement focus. This is the same approach used in the preparation of the proprietary fund financial statements but differs from the manner in which governmental fund financial statements are prepared. Governmental fund financial statements therefore include reconciliation with brief explanations to better identify the relationship between the government-wide statements and the statements for governmental funds. The government-wide statement of activities presents a comparison between direct expenses and program revenues for each segment of the business-type activities of the School District and for each function or program of the School District s governmental activities. Direct expenses are those that are specifically associated with a service, program or department and are therefore clearly identifiable to a particular function. Program revenues include charges paid by the recipient of the goods or services offered by the program and grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues are presented as general revenues of the School District, with certain limited exceptions. The comparison of direct expenses with program revenues identifies the extent to which each business segment or governmental function is self-financing or draws from the general revenues of the School District. Fund Financial Statements Fund financial statements report detailed information about the School District. The focus of governmental and proprietary fund financial statements is on major funds rather than reporting funds by type. Each major fund is presented in a separate column. Nonmajor funds are aggregated and presented in a single column. Internal service funds are combined and the totals are presented in a single column on the face of the proprietary fund statements. Fiduciary funds are reported by fund type. -9-

25 NOTES TO FINANCIAL STATEMENTS 1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C) BASIS OF PRESENTATION (Continued) The accounting and reporting treatment applied to a fund is determined by its measurement focus. All governmental fund types are accounted for using a flow of current financial resources measurement focus. The financial statements for governmental funds are a balance sheet, which generally includes only current assets and current liabilities, and a statement of revenues, expenditures and changes in fund balances, which reports on the sources (i.e., revenues and other financing sources) and uses (i.e., expenditures and other financing uses) of current financial resources. All proprietary fund types are accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and all liabilities associated with the operation of these funds are included on the statement of net assets. The statement of changes in fund net assets presents increases (i.e., revenues) and decreases (i.e., expenses) in net total assets. The statement of cash flows provides information about how the School District finances and meets the cash flow needs of its proprietary activities. Fiduciary funds are reported using the economic resources measurement focus. D) BASIC FINANCIAL STATEMENTS Financial statements of the reporting entity are organized into funds each of which is considered to be a separate accounting entity. Each fund is accounted for by providing a separate set of self-balancing accounts, which constitute its assets, liabilities, net assets/fund equity, revenues, and expenditures/expenses. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual proprietary funds are reported as separate columns in the fund financial statements. Funds are organized as major funds or non-major funds within the governmental and proprietary statements. 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 District or meets the following criteria: 1. Total assets, liabilities, revenues, or expenditures/expenses of that individual governmental or proprietary fund are at least 10 percent of the corresponding total for all funds of that category or type, and 2. The same element of the individual governmental fund or proprietary fund that met the 10 percent test is at least 5 percent of the corresponding total for all governmental and proprietary funds combined. The District reports the following major funds: Major Governmental Funds General Fund The general fund is used to account for all financial resources except those required to be accounted for and reported in another fund. A new fund, Genesee Opportunity fund, was created in the current year. This fund is included in the general fund and its net fund balance is shown as restricted. The general fund balance is available for any purpose provided it is expended or transferred according to the laws of the State of Michigan. Special Education Fund The special education fund is used to account for financial resources to be used specifically for providing special education services to students within the School District. Career Technical Education Fund - The career technical education fund is used to account for financial resources to be used specifically for providing vocational education services to students within the School District. -10-

26 NOTES TO FINANCIAL STATEMENTS 1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D) BASIC FINANCIAL STATEMENTS (Continued) Major Governmental Funds(Continued) Capital Projects Fund (Special Education Capital Projects) The capital projects fund accounts for financial resources to be used for the acquisition, construction, or improvement of capital facilities other than those financed by proprietary funds. Major Proprietary Funds General Local Districts Services Fund - The activities of the General Fund within the Proprietary Fund are county-wide interactive voice, data and video network (GENNET), shared services for technology, business, and custodial, energy savings consortium, Interactive Television (ITV) and online courses. Special Education Local Districts Services Fund - The activity of Special Education within the Proprietary Fund is transportation services for special education students in the county. The District reports the following non-major funds: Non-Major Governmental Funds Capital Projects Funds The capital projects funds account for financial resources to be used for the acquisition, construction, or improvement of capital facilities other than those financed by proprietary funds. Special Revenue Funds The Special Revenue Funds are used to segregate the transactions of particular activities from regular revenue and expenditure accounts. The District maintains full control of these funds. The District maintains one special revenue fund: School Service. Capital Projects Fund (Career Technical Education Capital Projects) The capital projects fund accounts for financial resources to be used for the acquisition, construction, or improvement of capital facilities other than those financed by proprietary funds. Building and Site Capital Projects Funds (GCI Capital Projects) - The Building and Site Capital Projects Funds are used to record bond proceeds or other revenue and the disbursement of funds specifically designated for acquiring new school sites, buildings, equipment, and for remodeling and repairs. The funds operate until the purpose for which they were created is accomplished. The District has complied with the applicable provision of 1351a of the Revised School Code. Non-Major Proprietary Funds Career Technical Education Local Districts Services Fund - The activity of Career Technical Education within the Proprietary Fund is transportation services for vocational education students in the county to and from the Genesee Area Skill Center. -11-

27 NOTES TO FINANCIAL STATEMENTS 1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D) BASIC FINANCIAL STATEMENTS (Continued) Fiduciary Funds Fiduciary fund reporting focuses on net assets and changes in net assets. The District s fiduciary funds consist of agency funds which are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. The agency funds are used to account for amount held for student and employee groups. During the course of operations the District has activity between funds for various purposes. Any residual balances outstanding at year end are reported as due from/to other funds. While these balances are reported in the fund financial statements, they are eliminated in the preparation of the government-wide financial statements. Further, certain activity occurs during the year involving transfers of resources between funds. In the fund financial statements these amounts are reported at gross amounts as transfers in/out. While reported in the fund financial statements, they are eliminated in the preparation of the government-wide financial statements. E) BASIS OF ACCOUNTING Basis of accounting determines when transactions are recorded in the financial records and reported on the financial statements. Government-wide financial statements are prepared using the accrual basis of accounting. Governmental funds use the modified accrual basis of accounting. Proprietary and fiduciary funds also use the accrual basis of accounting. Revenues Exchange and Non-exchange Transactions Revenues resulting from exchange transactions, in which each party receives essentially equal value, is recorded on the accrual basis when the exchange takes place. On a modified accrual basis, revenues are recorded in the fiscal year in which the resources are measurable and available. Available, means that the resources will be collected within the current fiscal year or are expected to be collected soon enough thereafter to be used to pay liabilities of the current fiscal year. For the School District, available means expected to be received within approximately sixty days of the fiscal year-end. Nonexchange transactions, in which the School District receives value without directly giving equal value in return, include property taxes, grants, entitlements and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from grants, entitlements and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. Eligibility requirements include timing requirements, which specify the year when the resources are required to be used or the fiscal year when use is first permitted, matching requirements, in which the School District must provide local resources to be used for a specified purpose, and expenditure requirements, in which the resources are provided to the School District on a reimbursement basis. On a modified accrual basis, revenues from nonexchange transactions must also be available before it can be recognized. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the enterprise funds and of the government's internal service funds are charges to customers for sales and services. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. Unearned Revenue Unearned Revenue arises when assets are recognized before revenue recognition criteria have been satisfied. -12-

28 NOTES TO FINANCIAL STATEMENTS 1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) E) BASIS OF ACCOUNTING (Continued) Grants and entitlements received before the eligibility requirements are met are recorded as Unearned Revenue. The long-term portion of the receivable for fees charged to local districts for the GENNET project have also been recorded as Unearned Revenue. Expenses/Expenditures On the accrual basis of accounting, expenses are recognized at the time they are incurred. The fair value of donated commodities used during the year is reported in the operating statement as an expense with a like amount reported as donated commodities revenue. Unused donated commodities are reported as Unearned Revenue. The measurement focus of governmental fund accounting is on decreases in net financial resources (expenditures) rather than expenses. Expenditures are generally recognized in the accounting period in which the related fund liability is incurred, if measurable. Allocations of cost, such as depreciation, are not recognized in governmental funds. F) CASH AND CASH EQUIVALENTS/INVESTMENTS Cash and cash equivalents include amounts in demand deposits, and short-term investments with original maturities of three months or less from the date of acquisition. Certain investments are valued at fair value as determined by quoted market prices, or by estimated fair values when quoted market prices are not available. The standards also provide that certain investments are valued at cost (or amortized cost) when they are of a short-term duration, the rate of return is fixed, and the district intends to hold the investment until maturity. State statues authorize the District to invest in bonds and other direct and certain indirect obligations of the U.S. Treasury, certificates of deposit, savings accounts, deposit accounts, or depository receipts of a bank, savings and loan association, or credit union, which is a member of the Federal Deposit Insurance Corporation, Federal Savings and Loan Insurance Corporation, or National Credit Union Administration, respectively; in commercial paper rated at the time of purchase within the three highest classifications established by no less than two standard rating services and which matures not more than 270 days after the date of purchase. The District is also authorized to invest in U.S. Government or federal agency obligation repurchase agreements, bankers acceptances of U.S. banks, and mutual funds composed of investments as outlined above. G) INVENTORIES AND PREPAID COSTS Inventories are valued at cost, on a first-in, first-out basis. Inventories of governmental funds are recorded as expenditures when consumed rather than when purchased. Certain payments to vendors reflect costs applicable to future fiscal years and are recorded as prepaid costs in both government-wide and fund financial statements. H) 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 assets but are not reported in the fund financial statements. Capital assets utilized by the proprietary funds are reported both in the business-type activities column of the government-wide statement of net assets and in the respective funds. All capital assets are capitalized at cost (or estimated historical cost) using a $5,000 capitalization threshold. The School District does not possess any infrastructure. Improvements are capitalized; the cost of normal maintenance and repairs that do not add to the value of the asset or materially extend an assets life are not. Interest incurred during the construction of capital assets is also capitalized. -13-

29 NOTES TO FINANCIAL STATEMENTS 1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) H) CAPITAL ASSETS (Continued) All reported capital assets are depreciated. Improvements are depreciated over the remaining useful lives of the related capital assets. Depreciation is computed using the straight-line method over the following useful lives: Description Buildings and Improvements Furniture and Equipment Vehicles and Buses Governmental Activities Estimated Lives years 5 10 years 5 10 years I) INTERFUND BALANCES On fund financial statements, receivables and payables resulting from short-term interfund loans are classified as interfund receivables/payables. These amounts are eliminated in the governmental and business-type activities columns of the statement of net assets, except for the net residual amounts due between governmental and business-type activities, which are presented as internal balances. J) COMPENSATED ABSENCES The liability for compensated absences reported in the government-wide statements consists of earned but unused accumulated vacation, sick leave, and severance benefits. A liability for these amounts is reported in governmental funds as it comes due for payment. The liability has been calculated using the vesting method, in which leave amounts are included both for employees who are currently eligible to receive termination payments and for other employees who are expected to become eligible in the future to receive such payments upon termination. K) LONG-TERM OBLIGATIONS In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the statement of net position. Bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are reported as debt service expenditures. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts are reported as other financing uses. Issuance costs are reported as debt service expenditures. L) DEFERRED OUTFLOWS/INFLOWS OF RESOURCES Deferred Outflows In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The District only has one item that qualifies for reporting in this category. It is the pension contributions reported in the government-wide statement of net position. A deferred outflow is recognized for pension contributions made after the plans measurement date, but before the fiscal year end. The amount is amortized in the plan year in which it applies. -14-

30 NOTES TO FINANCIAL STATEMENTS 1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) L) DEFERRED OUTFLOWS/INFLOWS OF RESOURCES (Continued) Deferred Inflows In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The District has one item that qualifies for reporting in this category. It is the future resources yet to be recognized in relation to the pension actuarial calculation. These future resources arise from differences in the estimates used by the actuary to calculate the pension liability and the actual results. The amounts are amortized over a period determined by the actuary. M) DEFINED BENEFIT PLAN For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Michigan Public Employees Retirement System (MPSERS) and additions to/deductions from MPSERS fiduciary net position have been determined on the same basis as they are reported by MPSERS. 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. N) FUND BALANCE Fund balances for each of the District's governmental funds (General Fund, special revenue funds, capital projects funds, and debt service funds) are displayed in the following classifications depicting the relative strength of the spending constraints placed on the purposes for which resources can be used: * Nonspendable fund balance - amounts that cannot be spent because they are either not in a spendable form (such as inventories and prepaid amounts) or are legally or contractually required to be maintained intact. * Restricted fund balance - amounts that can be spent only for specific purposes because of constraints imposed by external providers (such as grantors, bondholders, and higher levels of government), or imposed by constitutional provisions or enabling legislation. The District s Genesee Opportunity Fund (included in General Fund), Special Education Fund, Career Technical Education Fund, GCI Capital Projects Fund, and School Service balances are considered restricted. * Committed fund balance - amounts that can be spent only for specific purposes determined by a formal action resolution of the District s highest level of decision-making authority, the Board of Education. * Assigned fund balance - amounts the District intends to use for specific purposes that do not meet the criteria to be classified as restricted or committed. The intent is expressed by the Board of Education. * Unassigned fund balance - amounts that are available for any purpose; these amounts can be reported only in the District's General Fund. The District would typically use restricted fund balance first, followed by committed resources, and then assigned resources as appropriate opportunities arise, but reserve the right to selectively spend unassigned resources first to defer the use of these classified funds. -15-

31 NOTES TO FINANCIAL STATEMENTS 1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) O) NET POSITION Net position represent the difference between assets and liabilities. Net position invested in capital assets, net of related debt consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowings used for the acquisition, construction or improvement of those assets. Net position are reported as restricted when there are limitations imposed on their use either through the enabling legislation adopted by the School District or through external restrictions imposed by creditors, grantors or laws or regulations of other governments. P) REVENUES Program Revenues Amounts reported as program revenues include (1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment, and (2) grants and contributions that are restricted to meeting the operational requirements of a particular function or segment. All taxes, including those dedicated for specific purposes, unrestricted state aid, interest, and other internally dedicated resources are reported as general revenues rather than as program revenues. Operating revenues are those revenues that are generated directly from the primary activity of the proprietary funds. For the School District, those revenues are primary fees collected for providing transportation of special education students, fees collected for transportation of students in the Flint Community School Districts and fees collected for local district use of the GENNET interactive voice, data and video system. Q) CONTRIBUTIONS OF CAPITAL Contributions of capital in proprietary fund financial statements arise from outside contributions of fixed assets, or from grants or outside contributions of resources restricted to capital acquisition and construction. R) INTERFUND ACTIVITY Transfers between governmental and business-type activities on the government-wide statements are reported in the same manner as general revenues. Exchange transactions between funds are reported as revenues in the seller funds and as expenditures/ expenses in the purchaser funds. Flows of cash or goods from one fund to another without a requirement for repayment are reported as interfund transfers. Interfund transfers are reported as other financing sources/uses in governmental funds and after nonoperating revenues/expenses in proprietary funds. Repayments from funds responsible for particular expenditures/expenses to the funds that initially paid for them are not presented on the financial statements. S) EXTRAORDINARY AND SPECIAL ITEMS Extraordinary items are transactions or events that are both unusual in nature and infrequent in occurrence. Special items are transactions or events that are within the control of the Board of Education and that are either unusual in nature or infrequent in occurrence. Neither type of transaction occurred during the fiscal year ended June 30, T) BUDGETARY DATA Annual budgets are adopted on a basis consistent with generally accepted accounting principles for the general fund and special revenue fund. The capital projects fund is appropriated on a project-length basis. Other funds do not have appropriated budgets. Appropriations in all budgeted funds lapse at the end of the fiscal year even if they have related encumbrances. Encumbrances are commitments related to unperformed (executor) contracts for goods or services (i.e., purchase orders, contracts, and commitments). The District does not utilize encumbrance accounting. -16-

32 NOTES TO FINANCIAL STATEMENTS 1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) T) BUDGETARY DATA (Continued) The District follows these procedures in establishing the budgetary data reflected in the financial statements: 1. The Superintendent submits to the School Board a proposed operating budget for the fiscal year commencing on July 1. The operating budget includes proposed expenditures and the means of financing them. The level of control for the budgets is at the functional level as set forth and presented as required supplementary information. 2. Public hearings are conducted to obtain taxpayer comments. 3. Prior to July 1, the budget is legally adopted by School Board resolution pursuant to the Uniform Budgeting and Accounting Act (1968 PA 2). The Act requires that the budget be amended prior to the end of the fiscal year when necessary to adjust appropriations if it appears that revenues and other financing sources will be less than anticipated or so that expenditures will not be in excess of original estimates. Expenditures shall not be made or incurred, unless authorized in the budget, in excess of the amount appropriated. Violations, if any, in the general fund are noted in the required supplementary information section. 4. Transfers may be made for budgeted amounts between major expenditure functions within any fund; however, these transfers and any revisions that alter the total expenditures of any fund must be approved by the School Board. 5. The budget was amended during the year with supplemental appropriations, the last one approved prior to year end June 30, The District does not consider these amendments to be significant. 2) DEPOSITS AND INVESTMENTS As of June 30, 2017, the District had the following investments. Weighted Standard Average & Poor's Investment Type Fair value Maturity (Years) Rating % MILAF External Investment Pool - MICMS $ 11,653,662 N/A AAA 65.33% MILAF External Investment Pool - MIMAX 6,185,046 N/A AAA 34.67% TOTAL $ 17,838, % Interest rate risk. In accordance with its investment policy, the District will minimize interest rate risk, which is the risk that the market value of securities in the portfolio will fall due to changes in market interest rates, by; structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations, thereby avoiding the need to sell securities in the open market; and, investing operating funds primarily in shorterterm securities, liquid asset funds, money market mutual funds, or similar investment pools and limiting the average maturity in accordance with the District s cash requirements. Concentration of credit risk. The District will minimize concentration of credit risk, which is the risk of loss attributed to the magnitude of the District s investment in a single issuer, by diversifying the investment portfolio so that the impact of potential losses from any one type of security or issuer will be minimized. Custodial credit risk deposits. In the case of deposits, this is the risk that in the event of a bank failure, the District s deposits may not be returned to it. As of June 30, 2017, $43,206,287 of the District s bank balance of $44,147,806 was exposed to custodial credit risk. -17-

33 NOTES TO FINANCIAL STATEMENTS 2) DEPOSITS AND INVESTMENTS (Continued) Custodial credit risk investments. For an investment, this is the risk that, in the event of the failure of the counterparty, the District will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The District will minimize custodial credit risk, which is the risk of loss due to the failure of the security issuer or backer, by; limiting investments to the types of securities allowed by law; and pre-qualifying the financial institutions, broker/dealers, intermediaries and advisors with which the District will do business. Foreign currency risk. The District is not authorized to invest in investments which have this type of risk. Fair value measurement. The District is required to disclose amounts within a framework established for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy are described as follows: Level 1: Level 2: Level 3: Quoted prices in active markets for identical securities. Prices determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include prices for similar securities, interest rates, prepayment speeds, credit risk and others. Prices determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable or deemed less relevant, unobservable inputs may be used. Unobservable inputs reflect the District s own assumptions about the factors market participants would use in pricing an investment and would be based on the best information available. The asset or liability s fair measurement level with the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs. MILAF-MIMAX investments fair value measurement is level 2. The above amounts as previously report in Note 2: Cash Agency Fund $ 255,074 Cash District Wide Governmental Funds 33,084,446 Cash Proprietary Funds 6,728,058 Investments District Wide Governmental Funds 17,838,708 TOTAL $ 57,906,286 The above amounts are reported in the financial statements as follows: Petty Cash $ 2,620 Checking/Savings Accounts Governmental Funds Including Fiduciary Funds of $255,074 33,336,900 Checking/Savings Accounts Proprietary Funds 6,728,058 Investments Governmental Funds 17,838,708 TOTAL $ 57,906,

34 NOTES TO FINANCIAL STATEMENTS 3) PROPERTY TAXES Property taxes levied by the District are collected by various municipalities and periodically remitted to the District. The District levies its property taxes in summer and winter and various municipalities collect its property taxes and remit them to the District through February. The delinquent real property taxes of the District are purchased by the County, and delinquent personal property taxes continue to be collected by the municipalities and recorded as revenue as they are collected. The county sells tax notes, the proceeds of which have been used to pay the District for these delinquent real property taxes. These delinquent real property taxes have been recorded as revenue in the current year. 4) RECEIVABLES Receivables at June 30, 2017, consist of taxes, accounts (fees), intergovernmental grants and interest. All receivables are considered collectible in full due to the ability to foreclose for the nonpayment of taxes, the stable condition of State programs, and the current year guarantee of federal funds. A summary of the principal items of intergovernmental receivables (due from other governmental units) follows: GOVERNMENTAL ACTIVITIES AMOUNT State Aid $ 11,346,714 Federal Grants 10,393,846 Other Grant Programs & Fees 437,216 TOTAL GOVERNMENTAL ACTIVITIES $ 22,177,776 5) CAPITAL ASSETS Capital asset activity for the fiscal year ended June 30, 2017, was as follows: Balance Balance Beginning Additions Deductions Ending GOVERNMENTAL ACTIVITIES Land, Not Being Depreciated $186,167 $0 $0 $186,167 Buildings and Improvements 15,495,584 12,826, ,322,235 Land Improvements 15,627, , ,769,935 Furniture and Equipment 8,937, , ,249,005 Vehicles 1,497, , ,845,333 Totals at Historical Cost $41,745,210 $13,627,465 $0 $55,372,675 Less: Accumulated Depreciation Buildings and Improvements (8,982,972) (429,937) 0 (9,412,909) Land Improvements (5,178,405) (742,098) 0 (5,920,503) Furniture and Equipment (7,905,210) (166,781) 0 (8,071,991) Vehicles (958,744) (141,560) 0 (1,100,304) Total Accumulated Depreciation ($23,025,331) ($1,480,376) $0 ($24,505,707) GOVERNMENTAL ACTIVITIES CAPITAL ASSETS - NET $18,719,879 $12,147,089 $0 $30,866,

35 NOTES TO FINANCIAL STATEMENTS 5) CAPITAL ASSETS (Continued) Balance Balance Beginning Additions Deductions Ending BUSINESS - TYPE ACTIVITIES Furniture and Equipment $13,256,118 $109,378 $0 $13,365,496 Buses 11,634, ,510 (919,244) 11,579,329 Totals at Historical Cost $24,890,181 $973,888 ($919,244) $24,944,825 Less: Accumulated Depreciation Furniture and Equipment (12,482,759) (113,087) 0 (12,595,846) Buses (8,507,141) (541,876) 919,244 (8,129,773) Total Accumulated Depreciation ($20,989,900) ($654,963) $919,244 ($20,725,619) BUSINESS - TYPE ACTIVITIES CAPITAL ASSETS - NET $3,900,281 $318,925 $0 $4,219,206 Depreciation expense was unallocated on the Statement of Activities as the District considers all fixed assets to have mixed use. 6) SHORT-TERM DEBT The District has various options for short-term financing including tax anticipation notes, state aid anticipation notes and lines of credit. The District entered into no short-term financing arrangements during the fiscal year ended June 30, ) GENERAL LONG-TERM DEBT The payment dates of sick days payable is undeterminable. A) 2014 School Improvement Bonds The District issued School Improvement Bonds dated November 12, 2014 for improvements to the Genesee Career Institute. These general obligation tax bonds require fifteen annual principal payments beginning May 1, 2016, and semi-annual interest payments at rates ranging from 2.0% to 4.0%. The balance at June 30, 2017 was $7,555,000. B) Annual Principal Requirements The annual principal requirements for all debts outstanding as of June 30, 2017 are as follows: Bonds Payable Interest Total June 30, 2018 $235,000 $242,500 $477,500 June 30, , , ,800 June 30, , , ,800 June 30, , , ,700 June 30, , , ,075 June 30, ,510, ,263 4,331,263 June 30, ,410, ,063 2,603,063 TOTAL $7,555,000 $2,176,201 $9,731,

36 NOTES TO FINANCIAL STATEMENTS 7) GENERAL LONG-TERM DEBT (Continued) C) Changes in General Long-Term Debt Balance Balance Amount Due Governmental Activities: Beginning Additions Deductions Ending in One Year Bonds Payable $7,780,000 $0 $225,000 $7,555,000 $235,000 Bond Premium 153, , ,751 11,493 Compensated Absences Payable 464,905 25, ,441 0 TOTAL $8,398,150 $25,536 $236,494 $8,187,192 $246,493 Business Type Activities Compensated Absences Payable $110,932 $13,738 $0 $124,670 $0 8) INTERFUND TRANSFERS Interfund transfers for the year ended June 30, 2017, consisted of the following: TRANSFERS TO TRANSFERS FROM Special Career General Food Education Technical Fund Service Fund Education Fund Total General Fund $0 $8,351 $0 $0 $8,351 Capital Projects Fund 546, ,200,000 2,776,500 6,522,500 TOTAL $546,000 $8,351 $3,200,000 $2,776,500 $6,530,851 Transfers were used to finance various capital projects accounted for in other funds in accordance with budgetary authorizations. 9) FUND BALANCE Assigned fund balances consisted of the following: General Fund Mott Middle College $195,891 Genesee Early College 581,322 Greater Flint Educational Consortium 100,913 Subsequent Year Expenditures 453,841 TOTAL $1,331,

37 NOTES TO FINANCIAL STATEMENTS 10) OPERATING LEASES The District had multiple leases for copiers from IKON Office Solutions, Inc. The leases call for 60 monthly payments and expire at varying times through June 30, The future minimum payments are as follows: 2018 $ 223, , , ,113 TOTAL $ 758,909 11) TAX ABATEMENTS Effective for the year ended June 30, 2017 the District is required to disclose significant tax abatements as required by GASB statement 77 (Tax abatements). The District receives reduced property tax revenues as a result of Industrial Facilities Tax exemptions granted by cities and townships. Industrial facility exemptions are intended to promote construction of new industrial facilities, or to rehabilitate historical facilities. The property taxes abated for all funds by municipality under these programs are as follows: Municipality Taxes Abated Davison City $ 77 Davison Township 15,855 Fenton City 680 Fenton Township 4,623 Flint City 86,803 Flint Township 7,764 Flushing City 104 Genesee Township 4,670 Grand Blanc City 3 Grand Blanc Township 37 Linden City 4,406 Mt. Morris City 20 Mt Morris Township 15,480 Mundy Township 1,628 Richfield Township 789 Tyrone Township 4,469 Vienna Township 117 TOTAL $ 147,525 The taxes abated for the general fund operating millage is considered by the State of Michigan when determining the District s section 22 funding of the State School Aid Act. There are no significant abatements made by the District. -22-

38 NOTES TO FINANCIAL STATEMENTS 12) RESTRICTED NET POSITION Restricted net position consists of the following: Genesee Opportunity $1,573,623 Food Service 114,554 TOTAL $1,688,177 13) RESTATEMENT OF NET POSITION The restatement of the beginning of the year net position is as follows: Governmental Enterprise Total Net Position as previously stated June 30, 2016 ($44,306,896) $12,178,045 ($32,128,851) Adjust to Record GASB 68 Pension Related Accounts on Enterprise Fund 16,590,097 (16,590,097) 0 NET POSITION AS RESTATED JUNE 30, 2016 ($27,716,799) ($4,412,052) ($32,128,851) 14) DEFINED BENEFIT PLAN AND POST RETIREMENT BENEFITS Plan Description The Michigan Public School Employees Retirement System (MPSERS) is a cost-sharing, multiple employer, statewide, defined benefit public employee retirement plan governed by the State of Michigan (State) originally created under Public Act 136 of 1945, recodified and currently operating under the provisions of Public Act 300 of 1980, as amended. Section 25 of this act establishes the board s authority to promulgate or amend the provisions of the System. MPSERS issues a publicly available Comprehensive Annual Financial Report that can be obtained at Benefits Provided Participants are enrolled in one of multiple plans based on date of hire and certain voluntary elections. A Summary of the pension plans offered by MPSERS is as follows: Plan Name Plan Type Plan Status Basic Defined Benefit Closed Member Investment Plan (MIP) Defined Benefit Closed Pension Plus Hybrid Open Defined Contribution Defined Contribution Open Benefit provisions of the defined benefit pension plan are established by State statute, which may be amended. Public Act 300 of 1980, as amended, establishes eligibility and benefit provisions for the defined benefit (DB) pension plan. Retirement benefits for DB plan members are determined by final average compensation and years of service. DB members are eligible to receive a monthly benefit when they meet certain age and service requirements. The System also provides disability and survivor benefits to DB plan members. Prior to Pension reform of 2010 there were two plans commonly referred to as Basic and the Member Investment Plan (MIP). Basic Plan member s contributions range from 0% - 4%. On January 1, 1987, the Member Investment Plan (MIP) was enacted. MIP members enrolled prior to January 1, 1990, contribute at a permanently fixed rate of 3.9% of gross wages. Members first hired January 1, 1990, or later including Pension Plus Plan members, contribute at various graduated permanently fixed contribution rates from 3.0% - 7.0%. -23-

39 NOTES TO FINANCIAL STATEMENTS 14) DEFINED BENEFIT PLAN AND POST RETIREMENT BENEFITS (Continued) Pension Reform 2010 On May 19, 2010, the Governor signed Public Act 75 of 2010 into law. As a result, any member of the Michigan Public School Employees Retirement System (MPSERS) who became a member of MPSERS after June 30, 2010 is a Pension Plus member. Pension Plus is a hybrid plan that contains a pension component with an employee contribution (graded, up to 6.4% of salary) and a flexible and transferable defined contribution (DC) tax-deferred investment account that earns an employer match of 50% (up to 1% of salary) on employee contributions. Retirement benefits for Pension Plus members are determined by final average compensation and years of service. Disability and survivor benefits are available to Pension Plus members. Pension Reform 2012 On September 4, 2012, the Governor signed Public Act 300 of 2012 into law. The legislation grants all active members who first became a member before July 1, 2010 and who earned service credit in the 12 months ending September 3, 2012, or were on an approved professional services or military leave of absence on September 3, 2012, a voluntary election regarding their pension. Any changes to a member s pension are effective as of the member s transition date, which is defined as the first day of the pay period that begins on or after February 1, Under the reform, members voluntarily chose to increase, maintain, or stop their contributions to the pension fund. Members who elected under Option 1 to increase their level of contribution contribute 4% (Basic Plan) or 7% (MIP). Regular Retirement (no reduction factor for age) Eligibility - Age 55 with 30 years credited service; or age 60 with 10 years credited service. For Member Investment Plan (MIP) members, any age with 30 years credited service; or age 60 with 10 years credited service; or age 60 with 5 years of credited service provided member worked through 60th birthday and has credited service in each of the last 5 years. For Pension Plus (PPP) members, age 60 with 10 years of credited service. Annual Amount - Total credited service as of the Transition Date times 1.5% of final average compensation (FAC). Pension Plus An amount determined by the member s election of Option 1, 2, 3, or 4 described below. Option 1 Credited Service after the Transition Date times 1.5% times FAC. Option 2 Credited Service after the Transition Date (until total service reaches 30 years) times 1.5% times FAC, PLUS Credited Service after the Transition Date and over 30 years times 1.25% times FAC. Option 3 Credited Service after the Transition Date times 1.25% times FAC. Option 4 None (Member will receive benefit through a Defined Contribution plan). Employees who first work on or after September 4, 2012 choose between two retirement plans: the Pension Plus Plan and a Defined Contribution Plan that provides a 50% employer match up to 3% of salary on employee contributions. Final Average Compensation - Average of highest 60 consecutive months (36 months for MIP members). FAC is calculated as of the last day worked unless the member elected option 4, in which case the FAC is calculated at the Transition Date. Member Contributions Depending on the plan selected, member contributions range from 0% - 7%. Plan members electing the defined contributions plan are not required to make additional contributions. -24-

40 NOTES TO FINANCIAL STATEMENTS 14) DEFINED BENEFIT PLAN AND POST RETIREMENT BENEFITS (Continued) Employer Contributions Employers are required by Public Act 300 of 1980, as amended, to contribute amounts necessary to finance the coverage of members and retiree Other Post-Employment Benefits (OPEB). Contribution provisions are specified by State statute and may be amended only by action of the State Legislature. Employer contributions to the System are determined on an actuarial basis using the entry age normal actuarial cost method. Under this method, the actuarial present value of the projected benefits of each individual included in the actuarial valuation is allocated on a level basis over the service of the individual between entry age and assumed exit age. The portion of this cost allocated to the current valuation year is called the normal cost. The remainder is called the actuarial accrued liability. Normal cost is funded on a current basis. The unfunded (overfunded) actuarial accrued liability as of September 30, 2016 valuation will be amortized over a 20 year period for fiscal year School districts contributions are determined based on employee elections. There are several different benefit options included in the plan available to employees based on date of hire. Contribution rates are adjusted annually by the ORS. The range of rates is as follows: October 1, 2015 September 30, % % October 1, 2016 September 30, % % The District s pension contributions for the year ended June 30, 2017 were equal to the required contribution total. The District s recognized pension expense of approximately $11,018,000 with $10,705,000 specifically for the Defined Benefit Plan. These amounts include contributions funded from state revenue Section 147c restricted to fund the MPSERS Unfunded Actuarial Accrued Liability (UAAL) Stabilization Rate (72.88% for pension and 27.12% for OPEB). At June 30, 2017, the Reporting Unit reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Deferred Outflows Deferred (Inflows) of Resources of Resources Differences Between Expected and Actual Experience $1,415,051 ($269,101) Changes of Assumptions 1,775,163 0 Net Difference Between Projected and Actual Earnings on Pension Plan Investments 1,887,091 0 Changes in Proportion and Differences between Employer Contributions and Proportionate Share of Contributions 2,437,611 (290,440) Employer Contributions Subsequent to the Measurement Date 9,520,357 0 TOTAL $17,035,273 ($559,541) -25-

41 NOTES TO FINANCIAL STATEMENTS 14) DEFINED BENEFIT PLAN AND POST RETIREMENT BENEFITS (Continued) Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions Pension Liabilities At June 30, 2017, the District reported a liability of $113,543,457 for its proportionate share of the net pension liability. The net pension liability was measured as of September 30, 2016, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The District s proportion of the net pension liability was based on a projection of its long-term share of contributions to the pension plan relative to the projected contributions of all participating reporting units, actuarially determined. At September 30, 2016 and 2015, the District s proportion was percent and percent. Measurement of the MPSERS Net Pension Liability The plan s net pension liability is to be measured as the total pension liability, less the amount of the pension plan s fiduciary net position. In actuarial terms, this will be the accrued liability less the market value of assets (not the smoothed actuarial value of assets that is often encountered in actuarial valuations performed to determine the employer s contribution requirement). MPSERS (Plan) Net Pension Liability - Non-University Employers Total Pension Liability $ 67,917,445,078 $ 66,312,041,902 Plan Fiduciary Net Position (42,968,263,308) (41,887,015,147) Net Pension Liability $ 24,949,181,770 $ 24,425,026,755 Proportionate Share % % Net Pension Liability for the District 113,543, ,032,613 Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended June 30, 2017, the District recognized pension expense of approximately $9,775,000. This excludes contributions funded from state revenue Section 147c restricted to fund the MPSERS Unfunded Actuarial Accrued Liability (UAAL) Stabilization Rate. These amounts have been recorded as a deferred outflow as of June 30, $9,520,357, reported as deferred outflows of resources related to pensions resulting from District employer contributions subsequent to the measurement date, will be recognized as a reduction of the net pension liability in the subsequent fiscal year. 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 Ending Sept. 30, Amount 2017 $1,631, ,483, ,304, ,779 TOTAL $6,955,

42 NOTES TO FINANCIAL STATEMENTS 14) DEFINED BENEFIT PLAN AND POST RETIREMENT BENEFITS (Continued) Actuarial Assumptions Investment rate of return - 8.0% a year, compounded annually net of investment and administrative expenses for the Non-Hybrid groups and 7.0% a year, compounded annually net of investment and administrative expenses for the Hybrid group (Pension Plus plan). Salary increases - The rate of pay increase used for individual members is 3.5%. Inflation - 3.5% Mortality assumptions - The healthy life post-retirement mortality table used in this valuation of the System was the RP-2000 Male and Female Combined Healthy Mortality Table, adjusted for mortality improvements to 2025 using projection scale BB. Experience study - The annual actuarial valuation report of the System used for these statements is dated September 30, Assumption changes as a result of an experience study for the period 2007 through 2012 have been adopted by the System for use in the annual pension valuations beginning with the September 30, 2014 valuation. The long-term expected rate of return on pension plan investments - The rate was 8% (7% Pension Plus Plan) net of investment and administrative expenses was determined using a method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: Target Allocation* Long-term Expected Real Rate of Return* Investment Category Domestic Equity Pools 28.0% 5.9% Alternate Investment Pools 18.0% 9.2% International Equity 16.0% 7.2% Fixed Income Pools 10.5% 0.9% Real Estate and Infrastructure Pools 10.0% 4.3% Absolute Return Pools 15.5% 6.0% Short Term Investment Pools 2.0% 0.0% Total 100.0% * Long term rate of return does not include 2.1% inflation. Discount rate - The discount rate used to measure the total pension liability was 8% (7% for Pension Plus Plan). The projection of cash flows used to determine the discount rate assumed that employee contributions will be made at the current contribution rate and that contributions from school districts will be made at contractually required rates, actuarially determined. Based on those assumptions, the pension plan s fiduciary net position was projected to be available to make all projected future benefit payments of current active and inactive employees. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. -27-

43 NOTES TO FINANCIAL STATEMENTS 14) DEFINED BENEFIT PLAN AND POST RETIREMENT BENEFITS (Continued) Sensitivity of the net pension liability to changes in the discount rate The following presents the Reporting Unit s proportionate share of the net pension liability calculated using the discount rate of 8.0 percent (7% for Pension Plus Plan), as well as what the Reporting Unit s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (7.0 percent) or 1 percentage point higher than the current rate: 1% Decrease Non-Hybrid/ Hybrid)* 6.0% - 7.0% Current Single Discount Rate Assumption Non-Hybrid/ Hybrid)* 7.0% - 8.0% 1% Increase Non-Hybrid/ Hybrid)* 8.0% - 9.0% Reporting Unit s proportionate share of the net pension liability $146,215,393 $113,543,457 $85,997,874 Pension Plan Fiduciary Net Position Detailed information about the pension plan s fiduciary net position is available in the separately issued Michigan Public School Employees Retirement System 2016 Comprehensive Annual Financial Report. Payables to the Pension Plan At year end the School District is current on all required pension plan payments. Amounts accrued at year end for accounting purposes are separately stated in the financial statements as a liability titled accrued retirement. These amounts represent current payments for June paid in July, accruals for summer pay primarily for teachers and the contributions due funded from state revenue Section 147c restricted to fund the MPSERS Unfunded Actuarial Accrued Liability (UAAL) Stabilization Rate. Other Information Discount Rate Assumed Rate of Return On February 23, 2017, in accordance with PA 300 of 1980, as amended, the Michigan Public Schools Employees Retirement System s Board approved a decrease in the assumed investment rate of return (discount rate) used in the System s annual actuarial valuation for the non-hybrid defined benefit plan from 8% to 7.5% effective for the fiscal year 2016 valuation and following. The September 30, 2016 Annual Actuarial Valuation Report will be used to establish the employer contribution for the fiscal year beginning October 1, 2018 and will be based upon the 7.5% investment rate of return assumption. The actuarial computed employer contributions and the net pension liability will increase as a result of lowering the assumed investment rate of return. Pension Reform 2017 Senate Bill 401, to amend the Public School Employees Retirement Act (PA 300 of 1980, as amended),was presented to the Governor on June 29, 2017, and is awaiting his signature as of the date of this report. The bill would close the current hybrid plan (Pension Plus) to newly hired employees as of February 1, 2018 and create a new optional revised hybrid plan with similar benefit plan calculations but contains a 50/50 cost share between the employee and the employer, including the cost of future unfunded liabilities. The assumed rate of return on the new hybrid plan would equal 6%. Further, the bill provides, under certain conditions, that the new hybrid plan would close to new employees if the actuarial funded ratio falls below 85% for two consecutive years. The bill includes other provisions to the retirement eligibility age, plan assumptions, and unfunded liability payment methods. -28-

44 NOTES TO FINANCIAL STATEMENTS 14) DEFINED BENEFIT PLAN AND POST RETIREMENT BENEFITS (Continued) Benefit Provisions - Other Postemployment Introduction Benefit provisions of the postemployment healthcare plan are established by State statute, which may be amended. Public Act 300 of 1980, as amended, establishes eligibility and benefit provisions. Retirees have the option of health coverage. Beginning fiscal year 2013, it is funded on a prefunded basis. The System has contracted to provide the comprehensive group medical, hearing, dental and vision coverage for retirees and beneficiaries. A subsidized portion of the premium is paid by the System with the balance deducted from the monthly pension of each retiree health care recipient. For members who first worked before July 1, 2008, (Basic, MIP-Fixed, and MIP-Graded plan members), the subsidy is the maximum allowed by statute. To limit future liabilities of Other Postemployment Benefits, members who first worked on or after July 1, 2008, (MIP-Plus plan members), have a graded premium subsidy based on career length where they accrue credit towards their insurance premiums in retirement, not to exceed the maximum allowable by statute. Public Act 300 of 2012 sets the maximum subsidy at 80% beginning January 1, 2013; 90% for those Medicare eligible and enrolled in the insurances as of that date. Public Act 75 of 2010 requires each actively employed member of MPSERS after June 30, 2010 to annually contribute 3% of their compensation to offset employer contributions for health care benefits of current retirees. Retiree Healthcare Reform of 2012 Public Act 300 of 2012 granted all active members of the Michigan Public School Employees Retirement System, who earned service credit in the 12 months ending September 3, 2012, or were on an approved professional services or military leave of absence on September 3, 2012, a voluntary election regarding their retirement healthcare. Any changes to a member s healthcare benefit are effective as of the member s transition date, which is defined as the first day of the pay period that begins on or after February 1, Under Public Act 300 of 2012, members were given the choice between continuing the 3% contribution to retiree healthcare and keeping the premium subsidy benefit described above, or choosing not to pay the 3% contribution and instead opting out of the subsidy benefit and becoming a participant in the Personal Healthcare Fund (PHF), a portable, tax-deferred fund that can be used to pay healthcare expenses in retirement. Participants in the PHF are automatically enrolled in a 2% employee contribution into their 457 account as of their transition date, earning them a 2% employer match into a 401(k) account. Members who selected this option stop paying the 3% contribution to retiree healthcare as of the day before their transition date, and their prior contributions will be deposited into their 401(k) accounts. Employer Contributions The District postemployment healthcare contributions to MPSERS for the year ended June 30, 2017, 2016 and 2015 were approximately $3,584,000, $3,477,000 and $1,294,000. The employer contribution rate ranged from 5.52% to 6.45% of covered payroll for the period October 1, 2013 to March 9, 2015; 2.2% to 2.71% of covered payroll for the period from March 10, 2015 to September 30, 2015 and from 6.4% to 6.83% of covered payroll for the period from October 1, 2015 through September 30, 2016; and 5.69% to 5.91% of covered payroll for the period from October 1, 2016 through September 30, 2017 dependent upon the employees date of hire and plan election. -29-

45 NOTES TO FINANCIAL STATEMENTS 15) RISK MANAGEMENT The District is exposed to various risks of loss in conducting its operations, from property and casualty, theft, damage to various tort and liability claims and workman's compensation claims. The District limits its exposure to such claims through its participation in and payments of premiums to SET-SEG, Inc. Insurance Trust. The pool maintains a loss fund and is also required by the terms of the participation agreement to obtain insurance and reinsurance as necessary. The terms of the participation agreement with the pool indicate that, should losses of the pool incurred in a given coverage period exceed the loss fund and the aggregate excess reinsurance, the fund may access its member districts on a pro-rata basis to cover excess losses. In past years the loss fund has exceeded the amount necessary to maintain prudent loss reserves, resulting in annual premium refunds to member districts. The District's management believes that participation in this pool provides sufficient coverage to protect the District from significant adverse financial impact. 16) CONTINGENCIES AND COMMITMENTS The District is involved in several legal matters as a result of worker s compensation claims and other business matters. The suits are being handled by the District s insurance carrier. The amounts of potential liability to the District, if any, is unknown as of the date of the auditor s opinion. 17) UPCOMING ACCOUNTING PRONOUNCEMENT Governmental Accounting Standards Board (GASB) Statement No. 75, Accounting and Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans, was issued by the GASB in June 2015 and will be effective for the District's 2018 fiscal year. The Statement requires governments that participate in defined benefit other postemployment benefit (OPEB) plans to report in the statement of net position a net OPEB liability. The net OPEB liability is the difference between the total OPEB liability (the present value of projected benefit payments to employees based on their past service) and the assets (mostly investments reported at fair value) set aside in a trust and restricted to paying benefits to current employees, retirees, and their beneficiaries. Statement 75 requires cost-sharing employers to record a liability and expense equal to their proportionate share of the collective net OPEB liability and expense for the cost-sharing plan. The Statement also will improve the comparability and consistency of how governments calculate the OPEB liabilities and expense. Governmental Accounting Standards Board (GASB) Statement No. 84, Fiduciary Activities, was issued by the GASB in January 2017 and will be effective for the District's 2020 year end. The objective of this Statement is to improve guidance regarding the identification of fiduciary activities for accounting and financial reporting purposes and how those activities should be reported. This Statement establishes criteria for identifying fiduciary activities for all state and local governments. The focus on the criteria generally is on (1) whether a government is controlling the assets of the fiduciary activity and (2) the beneficiaries with whom a fiduciary relationship exists. An activity meeting the criteria should be reported in a fiduciary fund in the basic financial statements. Districts with activities meeting the criteria should present a statement of fiduciary net position and a statement of changes in fiduciary net position. -30-

46 REQUIRED SUPPLEMENTARY INFORMATION

47 BUDGETARY COMPARISON SCHEDULE GENERAL FUND YEAR ENDED JUNE 30, 2017 Budgeted Amounts Variance With Original Final Actual Final Budget REVENUES Local and Interdistrict Sources $8,551,254 $11,938,479 $12,145,672 $207,193 State Sources 23,123,941 25,218,230 24,263,362 (954,868) Federal Sources 17,705,042 15,932,456 15,256,826 (675,630) Total Revenues $49,380,237 $53,089,165 $51,665,860 ($1,423,305) EXPENDITURES Instruction 15,007,972 14,937,951 14,707, ,215 Student Services 3,512,408 3,638,817 3,486, ,110 Instructional Staff 9,306,569 9,408,637 9,184, ,219 General Administration 1,165,358 1,059,969 1,039,976 19,993 School Administration 951, , ,809 8,220 Business Administration 1,055,677 1,296,577 1,166, ,912 Operation & Maintenance of Plant 1,903,325 1,905,815 1,818,766 87,049 Transportation 1,618,623 1,460,516 1,416,919 43,597 Support Services - Other 5,373,400 6,505,701 6,075, ,390 Community Services 319, , ,061 38,303 Total Expenditures $40,214,950 $41,864,376 $40,500,368 $1,364,008 Excess of Revenues Over Expenditures $9,165,287 $11,224,789 $11,165,492 ($59,297) OTHER FINANCING SOURCES (USES) (8,408,080) (9,593,402) (9,009,698) 583,704 Net Change in Fund Balance $757,207 $1,631,387 $2,155,794 $524,407 FUND BALANCE - BEGINNING OF YEAR 6,560,874 FUND BALANCE - END OF YEAR $8,716,

48 BUDGETARY COMPARISON SCHEDULE SPECIAL EDUCATION FUND YEAR ENDED JUNE 30, 2017 Budgeted Amounts Variance With Original Final Actual Final Budget REVENUES Local and Interdistrict Sources $25,849,752 $27,529,926 $28,390,264 $860,338 State Sources 28,043,494 30,332,467 30,051,808 (280,659) Federal Sources 17,281,775 18,777,287 18,008,363 (768,924) Total Revenues $71,175,021 $76,639,680 $76,450,435 ($189,245) EXPENDITURES Instruction 21,824,171 20,158,544 19,945, ,171 Student Services 11,748,267 13,532,120 13,416, ,369 Instructional Staff 956,143 1,521,346 1,489,064 32,282 General Administration 492, , ,901 2,964 School Administration 1,405,818 1,304,898 1,302,207 2,691 Business Administration 1,468,699 1,387,827 1,368,244 19,583 Operation & Maintenance of Plant 1,886,969 1,783,506 1,761,381 22,125 Transportation 8,537,813 7,580,377 7,566,784 13,593 Support Services - Other 2,839,977 3,751,480 3,484, ,206 Community Services 14,340 4,600 2,278 2,322 Total Expenditures $51,174,204 $51,482,563 $50,791,257 $691,306 Excess of Revenues Over Expenditures $20,000,817 $25,157,117 $25,659,178 $502,061 OTHER FINANCING SOURCES (USES) (20,258,028) (24,747,461) (24,267,923) 479,538 Net Change in Fund Balance ($257,211) $409,656 $1,391,255 $981,599 FUND BALANCE - BEGINNING OF YEAR 9,482,420 FUND BALANCE - END OF YEAR $10,873,

49 BUDGETARY COMPARISON SCHEDULE CAREER TECHNICAL EDUCATION FUND YEAR ENDED JUNE 30, 2017 Budgeted Amounts Variance With Original Final Actual Final Budget REVENUES Local and Interdistrict Sources $8,632,497 $9,122,123 $9,315,172 $193,049 State Sources 4,772,559 5,083,170 5,122,327 39,157 Federal Sources 1,301,738 1,311,649 1,264,815 (46,834) Total Revenues $14,706,794 $15,516,942 $15,702,314 $185,372 EXPENDITURES Instruction 4,774,052 5,081,922 5,069,303 12,619 Student Services 261, , ,980 (8,618) Instructional Staff 1,894,027 1,794,878 1,937,061 (142,183) General Administration 103,717 94,544 88,392 6,152 School Administration 762, , ,411 (30,941) Business Administration 249, , ,274 2,419 Operation & Maintenance of Plant 1,136,876 1,257,264 1,186,245 71,019 Transportation 852, , ,631 2,825 Support Services - Other 425, , ,842 5,449 Total Expenditures $10,459,212 $10,614,880 $10,696,139 ($81,259) Excess of Revenues Over Expenditures $4,247,582 $4,902,062 $5,006,175 $104,113 OTHER FINANCING SOURCES (USES) (3,943,492) (4,338,432) (4,237,932) 100,500 Net Change in Fund Balance $304,090 $563,630 $768,243 $204,613 FUND BALANCE - BEGINNING OF YEAR 4,960,703 FUND BALANCE - END OF YEAR $5,728,

50 BUDGETARY COMPARISON SCHEDULE SPECIAL EDUCATION CAPITAL PROJECTS FUND YEAR ENDED JUNE 30, 2017 Budgeted Amounts Variance With Original Final Actual Final Budget REVENUES Local Sources $600 $4,500 $5,389 $889 EXPENDITURES Capital Outlay 180, , , ,998 Excess of Revenues Over Expenditures ($180,336) ($988,000) ($373,113) $614,887 OTHER FINANCING SOURCES (USES) 0 3,200,000 3,200,000 0 Net Change in Fund Balance ($180,336) $2,212,000 $2,826,887 $614,887 FUND BALANCE - BEGINNING OF YEAR 6,056,428 FUND BALANCE - END OF YEAR $8,883,

51 REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF THE REPORTING UNIT'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY MICHIGAN PUBLIC SCHOOL EMPLOYEES RETIREMENT PLAN LAST 10 FISCAL YEARS (AMOUNTS WERE DETERMINTED AS OF 9/30 OF EACH FISCAL YEAR) Reporting unit's proportion of net pension liability (%) % % % Reporting unit's proportionate share of net pension liability $113,543,457 $110,032,613 $96,935,396 Reporting unit's covered-employee payroll $38,596,598 $37,131,323 $37,099,793 Reporting unit's proportionate share of net pension liability as a percentage of its covered-employee payroll % % % Plan fiduciary net position as a percentage of total pension liability 63.27% 63.17% 66.20% This schedule is presented to illustrate the requirement to show information for 10 years. However, until a full 10 year trend is compiled, reporting units should present information for those years for which information is available. -35-

52 REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF THE REPORTING UNIT'S CONTRIBUTIONS MICHIGAN PUBLIC SCHOOL EMPLOYEES RETIREMENT PLAN LAST 10 FISCAL YEARS (AMOUNTS WERE DETERMINTED AS OF 6/30 OF EACH FISCAL YEAR) Statutorily required contributions $10,705,007 $8,690,561 $6,834,787 Contributions in relation to statutorily required contributions 10,705,007 8,690,561 6,834,787 Contribution deficiency (excess) $0 $0 $0 Reporting unit's coveredemployee payroll $38,535,567 $37,036,903 $37,100,955 Contributions as a percentage of covered-employee payroll 27.78% 23.46% 18.42% This schedule is presented to illustrate the requirement to show information for 10 years. However, until a full 10 year trend is compiled, reporting units should present information for those years for which information is available. -36-

53 NOTES TO REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY INFORMATION Annual budgets are adopted on a basis consistent with generally accepted accounting principles for the General Fund, Special Education Fund and Career Technical Education Fund. All annual appropriations lapse at fiscal year end. The budget document presents information by fund and function. The legal level of budgetary control adopted by the governing body (i.e., the level at which expenditures may not legally exceed appropriations) is the function level. State law requires the School District to have its budget in place by July 1. Expenditures in excess of amounts budgeted are a violation of Michigan law. State law permits districts to amend their budgets during the year. During the year, the budget was amended in a legally permissible manner. The School District increased/decreased budgeted amounts during the year in response to changes in funding and related expenditures. Amounts encumbered for purchase orders, contracts, etc. are not tracked during the year. Budget appropriations are considered to be spent once the goods are delivered or the services rendered. During the year, Genesee Intermediate School District had the following expenditure budget variances. Final Variance With Career Technical Education Fund Budget Actual Final Budget Student Services $302,362 $310,980 ($8,618) Instructional Staff 1,794,878 1,937,061 (142,183) School Administration 660, ,411 (30,941) PENSION RELATED Changes of benefit terms: There were no changes of benefit terms for the plan year ended September 30, Changes of assumptions: There were no changes of benefit assumptions for the plan year ended September 30,

54 ADDITIONAL SUPPLEMENTARY INFORMATION

55 COMBINING BALANCE SHEET NON-MAJOR GOVERNMENTAL FUNDS JUNE 30, 2017 Career Total School GCI Technical General Durant Non-Major Service Capital Capital Capital Capital Governmental Fund Projects Projects Projects Projects Funds ASSETS Cash and Cash Equivalents $67,608 $0 $4,879,299 $2,601,912 $301,753 $7,850,572 Accounts Receivable , ,913 Due from Other Governmental Units 47, ,511 Prepaid Expenditures ,702 26,739 52,441 TOTAL ASSETS $115,135 $0 $4,879,299 $2,650,511 $328,492 $7,973,437 LIABILITIES Accounts Payable $581 $0 $172,007 $1,097 $793 $174,478 FUND BALANCE Non-Spendable Prepaid Expenditures ,702 26,739 52,441 Committed 0 0 4,707,292 2,623, ,960 7,631,964 Restricted School Service Fund 114, ,554 Total Fund Balance $114,554 $0 $4,707,292 $2,649,414 $327,699 $7,798,959 TOTAL LIABILITIES AND FUND BALANCE $115,135 $0 $4,879,299 $2,650,511 $328,492 $7,973,

56 COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NON-MAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2017 Career Total School GCI Technical General Durant Non-Major Service Capital Capital Capital Capital Governmental Fund Projects Projects Projects Projects Funds REVENUES Local Sources $32,938 $0 $3,794 $25,291 $428 $62,451 State Sources 1, ,315 Federal Sources 315, ,876 Total Revenues $350,129 $0 $3,794 $25,291 $428 $379,642 OTHER FINANCING SOURCES Transfers In 0 0 2,776, , ,322,500 Total Revenues and Other Financing Uses $350,129 $0 $2,780,294 $571,291 $428 $3,702,142 EXPENDITURES Food Service 316, ,574 Capital Outlay 0 330,820 3,158, , ,962 3,891,752 Total Expenditures $316,574 $330,820 $3,158,245 $265,725 $136,962 $4,208,326 OTHER FINANCING USES Transfers to Other Funds 8, ,351 Total Expenditures and Other Financing Uses $324,925 $330,820 $3,158,245 $265,725 $136,962 $4,216,677 Net Change in Fund Balance $25,204 ($330,820) ($377,951) $305,566 ($136,534) ($514,535) FUND BALANCE - BEGINNING OF YEAR 89, ,820 5,085,243 2,343, ,233 8,313,494 FUND BALANCE - END OF YEAR $114,554 $0 $4,707,292 $2,649,414 $327,699 $7,798,

57 INDIVIDUAL FUND SCHEDULES OF REVENUES, EXPENDITURES AND OTHER FINANCING SOURCES AND USES

58 SCHEDULE 1 GENESEE INTERMEDIATE SCHOOL DISTRICT - FLINT, MICHIGAN GENERAL FUND SCHEDULE OF REVENUES AND OTHER FINANCING SOURCES YEAR ENDED JUNE 30, 2017 REVENUES FROM Local Sources Current Tax Levy $3,812,735 Payments in Lieu of Taxes 6,696 Earnings on Investments and Deposits 39,579 Other Local Grants 325,872 Mott Middle College 150,000 Charges for Services 1,366,987 Miscellaneous 967,832 Total Local Sources $6,669,701 State Sources Intermediate Districts - Section 81 3,574,734 Renaissance Zone - Section 26a 69,074 Bus Driver Safety - Section ,673 Math and Science - Section ,783 Other State Grants 20,450,098 Total State Sources $24,263,362 Federal Sources Title I Regional Assistance 460,642 Headstart 11,273,446 Homeless Children and Youth 154,284 Title III Immigrant Education 124,861 21st Century Learning 1,948,310 Other Federal Grants 167,514 PeNut Foundation 1,087,847 Improving Teacher Quality 39,922 Total Federal Sources $15,256,826 Interdistrict Sources 5,475,971 Total Revenues $51,665,860 OTHER FINANCING SOURCES Transfer In from Food Service Fund 8,351 Other Transfers 103,273 Total Other Financing Sources $111,624 TOTAL REVENUES AND OTHER FINANCING SOURCES $51,777,

59 SCHEDULE 2 GENESEE INTERMEDIATE SCHOOL DISTRICT - FLINT, MICHIGAN SPECIAL EDUCATION FUND SCHEDULE OF REVENUES AND OTHER FINANCING SOURCES YEAR ENDED JUNE 30, 2017 REVENUES FROM Local Sources Current Tax Levy $22,393,838 Payments in Lieu of Taxes 61,104 Earnings on Investments and Deposits 135,817 Miscellaneous 79,196 Contributions 45,862 Charges for Services 13,145 Other Local Grants 135,589 Medicaid Fee-for-Service Program 4,923,914 Total Local Sources $27,788,465 State Sources Special Education Foundation - Section 51a.2 5,433,166 Special Education - Section 51a 9,018,541 Court Placed - Section 53a 7,952 Other State Grants 7,675,002 School for the Deaf/Blind - Section ,899 Special Education - Section 56 7,236,248 Total State Sources $30,051,808 Federal Sources IDEA Flowthrough 16,793,219 Enhancing Opportunities for Student with Disabilities 60,000 Preschool Incentive 450,448 Other Federal Grants 518,874 Transition Services 70,000 Medicaid Administrative Outreach Claims 115,822 Total Federal Sources $18,008,363 Interdistrict Sources 601,799 Total Revenues $76,450,435 OTHER FINANCING SOURCES Other Transfers 20,658 TOTAL REVENUES AND OTHER FINANCING SOURCES $76,471,

60 SCHEDULE 3 GENESEE INTERMEDIATE SCHOOL DISTRICT - FLINT, MICHIGAN CAREER TECHNICAL EDUCATION FUND SCHEDULE OF REVENUES AND OTHER FINANCING SOURCES YEAR ENDED JUNE 30, 2017 REVENUES FROM Local Sources Current Tax Levy $8,954,368 Payments in Lieu of Taxes 24,433 Earnings on Investments and Deposits 38,951 Charges for Services 25,080 Miscellaneous 272,340 Total Local Sources $9,315,172 State Sources Career Technical Education Administration - Section 61a.2 20,022 Career Technical Education - Section 61a.1 1,095,367 Career Technical Education Millage Equalization - Section 62 3,528,960 Other State Grants 477,978 Total State Sources $5,122,327 Federal Sources Secondary Regional Allocation 1,264,815 OTHER FINANCING SOURCES Other Transfers 1,155,120 TOTAL REVENUES AND OTHER FINANCING SOURCES $16,857,

61 SCHEDULE 4 GENESEE INTERMEDIATE SCHOOL DISTRICT - FLINT, MICHIGAN GENERAL FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES YEAR ENDED JUNE 30, 2017 INSTRUCTION Salaries - Professional $1,411,928 Salaries - Non-Professional 9,160 Insurances 237,590 Fica, Retirement, Etc. 629,425 Other Benefits 14,847 Purchased Services 11,446,368 Supplies & Materials 903,994 Capital Outlay 31,894 Other 22,530 Total Instruction $14,707,736 SUPPORT SERVICES STUDENT SERVICES Salaries - Professional 523,865 Salaries - Non-Professional 7,178 Insurances 72,771 Fica, Retirement, Etc. 209,192 Other Benefits 1,878 Purchased Services 2,560,521 Supplies & Materials 111,302 Total Student Services $3,486,707 INSTRUCTIONAL STAFF Salaries - Professional 1,822,219 Salaries - Non-Professional 534,313 Insurances 386,272 Fica, Retirement, Etc. 1,126,076 Other Benefits 38,098 Purchased Services 3,795,576 Supplies & Materials 1,478,631 Capital Outlay 284 Other 2,949 Total Instructional Staff $9,184,418 GENERAL ADMINISTRATION Salaries - Professional 328,386 Salaries - Non-Professional 133,199 Insurances 40,503 Fica, Retirement, Etc. 194,672 Other Benefits 4,146 Purchased Services 186,108 Supplies & Materials 77,962 Other 75,000 Total General Administration $1,039,

62 - FLINT, MICHIGAN GENERAL FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES YEAR ENDED JUNE 30, 2017 SCHEDULE 4 (Continued) SUPPORT SERVICES (Continued) SCHOOL ADMINISTRATION Salaries - Professional $224,490 Salaries - Non-Professional 172,508 Insurances 54,534 Fica, Retirement, Etc. 176,122 Other Benefits 7,025 Purchased Services 70,916 Supplies & Materials 16,464 Other 750 Total School Administration $722,809 BUSINESS ADMINISTRATION Salaries - Professional 284,393 Salaries - Non-Professional 182,805 Insurances 89,778 Fica, Retirement, Etc. 206,471 Other Benefits 7,463 Purchased Services 383,903 Supplies & Materials 11,067 Other 785 Total Business Administration $1,166,665 OPERATION & MAINTENANCE OF PLANT Salaries - Non-Professional 57,212 Insurances 13,042 Fica, Retirement, Etc. 28,843 Purchased Services 1,378,905 Supplies & Materials 340,764 Total Operation & Maintenance of Plant $1,818,766 TRANSPORTATION Salaries - Professional 44,707 Salaries - Non-Professional 168,064 Insurances 39,354 Fica, Retirement, Etc. 98,484 Other Benefits 3,942 Purchased Services 930,000 Supplies & Materials 104,297 Capital Outlay 27,448 Other 623 Total Transportation $1,416,

63 - FLINT, MICHIGAN GENERAL FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES YEAR ENDED JUNE 30, 2017 SCHEDULE 4 (Continued) SUPPORT SERVICES (Continued) OTHER SUPPORT SERVICES Salaries - Professional $535,322 Salaries - Non-Professional 623,909 Insurances 257,459 Fica, Retirement, Etc. 513,638 Other Benefits 24,582 Purchased Services 2,983,042 Supplies & Materials 84,584 Capital Outlay 1,000 Other 1,051,775 Total Other Support Services $6,075,311 Total Support Services $24,911,571 COMMUNITY SERVICES Salaries - Professional 733 Salaries - Non-Professional 2,564 Insurances 888 Fica, Retirement, Etc. 1,395 Purchased Services 813,500 Supplies & Materials 59,281 Other 2,700 Total Community Services $881,061 Total Expenditures $40,500,368 OTHER FINANCING USES Transfers to Other Funds 546,000 Transfers to Other Districts 8,575,322 Total Other Financing Uses $9,121,322 TOTAL EXPENDITURES AND OTHER FINANCING USES $49,621,

64 SCHEDULE 5 GENESEE INTERMEDIATE SCHOOL DISTRICT - FLINT, MICHIGAN SPECIAL EDUCATION FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES YEAR ENDED JUNE 30, 2017 INSTRUCTION Salaries - Professional $5,800,750 Salaries - Non-Professional 4,902,013 Insurances 2,814,997 Fica, Retirement, Etc. 5,038,822 Other Benefits 150,392 Purchased Services 899,379 Supplies & Materials 307,087 Capital Outlay 31,933 Total Instruction $19,945,373 SUPPORT SERVICES STUDENT SERVICES Salaries - Professional 6,449,738 Salaries - Non-Professional 360,664 Insurances 1,297,964 Fica, Retirement, Etc. 3,003,931 Other Benefits 57,835 Purchased Services 1,828,976 Supplies & Materials 417,643 Total Student Services $13,416,751 INSTRUCTIONAL STAFF Salaries - Professional 291,401 Salaries - Non-Professional 268,505 Insurances 126,265 Fica, Retirement, Etc. 246,005 Other Benefits 2,547 Purchased Services 344,553 Supplies & Materials 209,788 Total Instructional Staff $1,489,064 GENERAL ADMINISTRATION Salaries - Professional 92,006 Insurances 20,923 Fica, Retirement, Etc. 40,754 Other Benefits 277 Purchased Services 295,861 Supplies & Materials 80 Other 5,000 Total General Administration $454,

65 - FLINT, MICHIGAN SPECIAL EDUCATION FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES YEAR ENDED JUNE 30, 2017 SCHEDULE 5 (Continued) SUPPORT SERVICES (Continued) SCHOOL ADMINISTRATION Salaries - Professional $499,886 Salaries - Non-Professional 276,818 Insurances 154,931 Fica, Retirement, Etc. 339,196 Other Benefits 6,527 Purchased Services 16,569 Supplies & Materials 8,280 Total School Administration $1,302,207 BUSINESS ADMINISTRATION Salaries - Professional 243,028 Salaries - Non-Professional 395,673 Insurances 154,715 Fica, Retirement, Etc. 289,058 Other Benefits 12,006 Purchased Services 256,176 Supplies & Materials 17,087 Other 501 Total Business Administration $1,368,244 OPERATION & MAINTENANCE OF PLANT Salaries - Non-Professional 296,170 Insurances 78,824 Fica, Retirement, Etc. 147,596 Other Benefits 88 Purchased Services 842,223 Supplies & Materials 396,480 Total Operation & Maintenance of Plant $1,761,381 TRANSPORTATION Purchased Services 7,478,428 Supplies & Materials 4,512 Capital Outlay 83,844 Total Transportation $7,566,784 OTHER SUPPORT SERVICES Salaries - Professional 638,067 Salaries - Non-Professional 535,283 Insurances 169,871 Fica, Retirement, Etc. 518,571 Other Benefits 31,956 Purchased Services 1,173,406 Supplies & Materials 46,018 Other 371,102 Total Other Support Services $3,484,274 Total Support Services $30,843,

66 - FLINT, MICHIGAN SPECIAL EDUCATION FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES YEAR ENDED JUNE 30, 2017 SCHEDULE 5 (Continued) COMMUNITY SERVICES Purchased Services $1,821 Supplies & Materials 457 Total Community Services $2,278 Total Expenditures $50,791,257 OTHER FINANCING USES Transfers to Other Districts 21,008,784 Transfers to Other Funds 3,200,000 Capital Improvement 79,797 Total Other Financing Uses $24,288,581 TOTAL EXPENDITURES AND OTHER FINANCING USES $75,079,

67 SCHEDULE 6 GENESEE INTERMEDIATE SCHOOL DISTRICT - FLINT, MICHIGAN CAREER TECHNICAL EDUCATION FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES YEAR ENDED JUNE 30, 2017 INSTRUCTION Salaries - Professional $2,006,270 Salaries - Non-Professional 268,023 Insurances 464,421 Fica, Retirement, Etc. 1,073,554 Other Benefits 41,817 Purchased Services 350,636 Supplies 786,420 Capital Outlay 69,680 Other 8,482 Total Instruction $5,069,303 SUPPORT SERVICES STUDENT SERVICES Salaries - Professional 190,169 Insurances 35,777 Fica, Retirement, Etc. 84,227 Purchased Services 680 Other Benefits 127 Total Student Services $310,980 INSTRUCTIONAL STAFF Salaries - Professional 436,398 Salaries - Non-Professional 48,478 Insurances 73,921 Fica, Retirement, Etc. 216,241 Other Benefits 5,305 Purchased Services 1,078,932 Supplies & Materials 77,786 Total Instructional Staff $1,937,061 GENERAL ADMINISTRATION Purchased Services 88,392 SCHOOL ADMINISTRATION Salaries - Professional 219,201 Salaries - Non-Professional 150,469 Insurances 56,993 Fica, Retirement, Etc. 165,440 Other Benefits 8,654 Purchased Services 68,260 Supplies & Materials 22,394 Total Business Administration $691,

68 - FLINT, MICHIGAN CAREER TECHNICAL EDUCATION FUND SCHEDULE OF EXPENDITURES AND OTHER FINANCING USES YEAR ENDED JUNE 30, 2017 SCHEDULE 6 (Continued) SUPPORT SERVICES (Continued) BUSINESS ADMINISTRATION Salaries - Professional $30,270 Salaries - Non-Professional 55,785 Insurances 19,131 Fica, Retirement, Etc. 38,897 Other Benefits 2,269 Purchased Services 34,827 Supplies & Materials 1,960 Other 135 Total Business Administration $183,274 OPERATION & MAINTENANCE OF PLANT Salaries - Non-Professional 167,622 Insurances 23,366 Fica, Retirement, Etc. 87,658 Other Benefits 1,369 Purchased Services 643,199 Supplies & Materials 252,179 Capital Outlay 10,852 Total Operation & Maintenance of Plant $1,186,245 TRANSPORTATION Purchased Services 872,631 OTHER SUPPORT SERVICES Salaries - Professional 51,815 Salaries - Non-Professional 133,042 Insurances 24,716 Fica, Retirement, Etc. 83,348 Other Benefits 5,784 Purchased Services 35,587 Supplies & Materials 3,550 Other 19,000 Total Other Support Services $356,842 Total Support Services $5,626,836 Total Expenditures $10,696,139 OTHER FINANCING USES Transfers to Other Districts 2,144,062 Transfers to Other Funds 2,776,500 Bond Payment 472,000 Other Transfers 490 Total Other Financing Uses $5,393,052 TOTAL EXPENDITURES AND OTHER FINANCING USES $16,089,

69 SCHEDULE 7 GENESEE INTERMEDIATE SCHOOL DISTRICT - FLINT, MICHIGAN TRUST AND AGENCY FUND SCHEDULE OF RECEIPTS AND DISBURSEMENTS - OTHER GROUPS YEAR ENDED JUNE 30, 2017 Due to (From) Due to (From) Other Groups Other Groups July 1, 2016 Receipts Disbursements June 30, 2017 LEARNING CENTER ACTIVITIES Adult Jr Workshop $1,467 $3,161 $3,144 $1,484 Adult Worksites 321 1,531 1, Alumni Party Aric Genta Fundraiser Burton Workshop Cultural Enrichment 2,611 2,470 1,068 4,013 Donations 13,111 8,540 5,006 16,645 Earth Day 2,146 1, ,763 Elementary Fundraiser Formal Wear Graduation 220 2,622 2, Music Phys Ed Physical Therapy Prom 2,837 1,869 2,097 2,609 Robotics Room & Building Accounts 1, ,034 Senior Trip 2, ,922 Special Olympics 4, , Student Council Volkmann Memorial 1, ,214 VSA , Total Learning Center Activities $36,674 $24,180 $23,125 $37,729 MCIC ACTIVITIES Arts 4,393 3,508 3,657 4,244 Bowling Clothes Closet Donations 9,545 8,614 2,748 15,411 Family Fun Nite - Summer Carniva Fishing Food Baskets Fundraisers 1, ,157 Graduation Homecoming Music Playgrounds Popcorn 3,089 1,540 3,590 1,039 Rembcom 222 2,877 1,814 1,285 Rooms 4,720 4,294 4,851 4,163 School Store Special Olympics 2,140 2,273 4, Speech Student Portfolios Swimming TPA 3,559 2,651 5,159 1,051 Wellness Total MCIC Activities $32,250 $27,248 $27,271 $32,

70 - FLINT, MICHIGAN TRUST AND AGENCY FUND SCHEDULE OF RECEIPTS AND DISBURSEMENTS - OTHER GROUPS YEAR ENDED JUNE 30, 2017 SCHEDULE 7 (Continued) Due to (From) Due to (From) Other Groups Other Groups July 1, 2016 Receipts Disbursements June 30, 2017 MOTT MIDDLE COLLEGE Band CD $260 $0 $0 $260 Band Trip 2, ,525 1,159 Conference 1, ,171 Field Trip 57 2,000 1, Graduates 1, ,414 Holocaust Class 1, ,306 Music Dept Parent Organization 2,443 1,467 1,463 2,447 Prom Account 3,461 2,515 3,740 2,236 School Store ,000 Student Gov Tuition Yearbook Young Women , Total Mott Middle College $15,588 $8,324 $10,849 $13,063 EARLY CHILDHOOD PROGRAMS Clothing Sales 1, , Fundraiser Hold Redeemer Library Raffle Rooms 10, ,276 6,407 Snack Sales (13) Spring Concert (64) VG's VSA 862 1,347 1, Yearbook Total Early Childhood Programs $15,338 $1,922 $7,224 $10,036 OTHER Bus SVC Enhance Contributions Employee Activities EO Social Community 0 3,379 (200) 3,579 Flower Fund HR Wellness 2, ,448 HSN Fundraiser HSN Shirts (429) 0 0 (429) Pac Library Materials Sales Tax Collected Supt Donations 750 9,691 10, TMS Care Fund United Way Total Other $4,438 $14,264 $11,154 $7,

71 - FLINT, MICHIGAN TRUST AND AGENCY FUND SCHEDULE OF RECEIPTS AND DISBURSEMENTS - OTHER GROUPS YEAR ENDED JUNE 30, 2017 SCHEDULE 7 (Continued) Due to (From) Due to (From) Other Groups Other Groups July 1, 2016 Receipts Disbursements June 30, 2017 COUNTRY CRAFTERS FAIR Carman Ainsworth $132 $0 $89 $43 Carter Cookbooks Flushing Cntrl Mark Garner Grand Blanc Middle Lake Fenton Misc Music Northern (McKinley-Peters) 1, ,288 Physical Therapy Room and Building Accounts 11,467 1,195 3,952 8,710 West Bendle Total Country Crafters Fair $16,152 $1,195 $4,743 $12,604 TRANSITION CENTER Boxtops Craft Sales 551 1,222 1, Donations Graduation 294 2,537 1,800 1,031 Ink Cartridges Miscellaneous Proj Choice Spe Oly 4,164 4,798 6,230 2,732 Recycling 3,652 1, ,597 School Store 6,989 6,262 9,042 4,209 Senior Trip Social Fund VSA Clio/Flushing VSA Grand Blanc Proj Workshop Total Transition Center $18,996 $18,181 $19,936 $17,241 GENESEE EARLY COLLEGE Europe Trip 1,048 4,502 5, Field Trips Graduation 439 1,885 1,192 1,132 Key Club National Honor Society Newspaper Parent Organization 4,463 1,936 1,315 5,084 PSAT Robotics 695 2, ,171 Student Government 552 1,699 1, Theatre Group Yearbook Total Genesee Early College $9,885 $13,607 $12,964 $10,

72 - FLINT, MICHIGAN TRUST AND AGENCY FUND SCHEDULE OF RECEIPTS AND DISBURSEMENTS - OTHER GROUPS YEAR ENDED JUNE 30, 2017 SCHEDULE 7 (Continued) Due to (From) Due to (From) Other Groups Other Groups July 1, 2016 Receipts Disbursements June 30, 2017 GENESEE CAREER INSTITUTE 3D Gaming $18 $88 $0 $106 Agriscience Allied Health Architecture Automotive 2,077 3,667 4,123 1,621 Automotive Scholarship 2, ,128 BPA 0 4,185 4, Certified Nursing Assistant 1, ,396 Computers 8, ,814 6,206 Construction Cosmetology 15,802 43,978 45,886 13,894 Culinary 13,525 8,043 8,923 12,645 DECA Diesel/Heavy Equipment 1,535 1,000 1,343 1,192 Digital Multimedia 1, ,035 Education 2, ,641 Electrical Emergency Medical 2,051 4,365 4,681 1,735 Engineering 6,291 2,014 2,297 6,008 FFA Forensic II 3, ,767 Graphics/Print 17,409 9,406 6,572 20,243 HOSA 0 10,149 9, JROTC Medical Assistant Marketing 12, ,635 10,416 Medical Career Foundations 3,203 1,597 2,662 2,138 NTHS Nursing Public Safety 1, ,635 Radio 7,978 1,122 9, Skills USA 0 7,420 7, Sports Medicine 3,750 2,416 2,087 4,079 Student Support 11,528 16,027 19,116 8,439 Veterinary Medicine 6, ,505 Weekdays - Tips ,038 Welding 2, , Yearbook Total Genesee Career Institute $132,737 $121,385 $140,024 $114,098 TOTAL TRUST AND AGENCY FUNDS $282,058 $230,306 $257,290 $255,

73 SCHEDULE 8 GENESEE INTERMEDIATE SCHOOL DISTRICT - FLINT, MICHIGAN SCHEDULE OF BOND PRINCIPAL AND INTEREST REQUIREMENTS JUNE 30, SCHOOL IMPROVEMENT BONDS Date Authorized : November 12, 2014 Amount Authorized: $8,000,000 INTEREST INTEREST INTEREST PRINCIPAL AMOUNT AMOUNT RATE AMOUNT NOVEMBER 1 MAY 1 TOTAL PAYMENT DATE - MAY 1ST % $235,000 $121,250 $121,250 $477, % 250, , , , % 255, , , , % 265, , , , % 630, , , , % 655, , , , % 680,000 92,838 92, , % 700,000 82,637 82, , % 725,000 72,138 72, , % 750,000 60,356 60, , % 775,000 47,231 47, , % 805,000 32,700 32, , % 830,000 16,600 16, ,200 TOTAL $7,555,000 $1,088,100 $1,088,099 $9,731,

74 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2017 Pass- Accrued Current Accrued Transferred to Federal Through Program (Deferred) Prior Current Adjustments Year Cash/ (Deferred) Subrecipients Federal Grantor/Pass-Through Grantor/ CFDA Project Or Award Revenue Year Year Prior Payments In Revenue as of Program Title Number Number Amount July 1, 2016 Expenditures Expenditures Years Kind Received June 30, 2017 June 30, 2017 U.S. DEPARTMENT OF EDUCATION Passed Through Michigan Department of Education: Title I Grants to Local Education Agencies Title I - Part A Reg 3 Partnership (15-16) R3 $233,058 $34,091 $133,517 $43,601 $0 $77,692 $0 $0 Title I - Part A Reg 3 Partnership (16-17) R3 252, , ,091 30,521 0 Title I - Reg Assististance (15-16) ,677 70, ,967 90, , Title I - Reg Assististance (16-17) , , ,877 40,848 0 Total Title I Grants to Local Education Agencies $1,527,527 $104,216 $333,484 $460,642 $0 $493,489 $71,369 $0 Migrant Education Migrant ADM (15-16) R3 2, , Migrant ADM (16-17) R3 2, , , Migrant SW, Region 3 Partnership (15-16) R3 1, Migrant SW, Region 3 Partnership (16-17) R Total Migrant Education $7,368 $344 $1,253 $2,528 $0 $2,209 $663 $0 Special Education - Grants to States IDEA Flowthrough (14-15) ,208, ,989 16,183,697 24, , ,011 IDEA Flowthrough (15-16) ,114,463 6,393,324 15,418, , ,733, , ,912 IDEA Flowthrough (16-17) ,629, ,109, ,440,540 5,669,129 14,766,163 Transition Services (16-17) , , ,045 17,955 0 Transition Services (15-16) TC 70,000 17,383 70, , Enhancing Opportnuities (15-16) ,000 4,916 60, , Enhancing Opportnuities (16-17) , , ,354 5,646 0 Total Special Education - Grants to States $49,212,819 $6,789,612 $31,732,630 $16,923,219 $0 $17,701,439 $6,011,392 $15,145,086 Special Education - Preschool Grants Preschool Incentive (14-15) ,841 22, ,607 6, , ,338 Preschool Incentive (15-16) , , ,618 4, ,508 15,621 4,677 Preschool Incentive (16-17) , , , , ,433 Total Special Education - Preschool Grants $1,345,129 $200,129 $868,225 $450,448 $0 $478,619 $171,958 $382,448 Total Special Education Cluster $50,557,948 $6,989,741 $32,600,855 $17,373,667 $0 $18,180,058 $6,183,350 $15,527,534 Career Technical Education - Basic Grants to States Secondary Regional Allocation (15-16) ,301, ,804 1,274, , Secondary Regional Allocation (16-17) ,311, ,264, ,129, , ,013 Total Career Technical Education - Basic Grants to States $2,613,387 $248,804 $1,274,749 $1,264,815 $0 $1,378,579 $135,040 $657,013 Special Ed - Grants for Infants & Families With Disabilities Infant and Toddlers Formula Grant (15-16) ,464 4, , , Infant and Toddlers Formula Grant (16-17) , , ,635 87,021 0 Total Special Ed - Grants for Infants & Families With Disabilities $921,328 $4,718 $276,072 $353,656 $0 $271,353 $87,021 $0-56-

75 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2017 Pass- Accrued Current Accrued Transferred to Federal Through Program (Deferred) Prior Current Adjustments Year Cash/ (Deferred) Subrecipients Federal Grantor/Pass-Through Grantor/ CFDA Project Or Award Revenue Year Year Prior Payments In Revenue as of Program Title Number Number Amount July 1, 2016 Expenditures Expenditures Years Kind Received June 30, 2017 June 30, 2017 U.S. DEPARTMENT OF EDUCATION (Continued) Passed Through Michigan Department of Education (Continued): Education for Homeless Children and Youth Title XC, Homeless Reg 3 Part Grant (15-16) R3 $65,485 $22,067 $55,673 $6,717 $0 $28,784 $0 $0 Title XC, Homeless Reg 3 Part Grant (16-17) R3 91, , ,787 10,082 0 HAA VII-B Homeless Child Education (15-16) ,042 5,860 61,895 20, , HAA VII-B Homeless Child Education (16-17) , , ,662 26,833 0 Total Education for Homeless Children and Youth $345,911 $27,927 $117,568 $154,284 $0 $145,296 $36,915 $0 21st Century Learning Grant C 21st Century Learning Cohort G (15-16) G ,000 47, , , st Century Learning Cohort G (16-17) G , , , , st Century Learning Cohort Ia (15-16) I ,000 53, , , st Century Learning Cohort Ia (16-17) I , , , , st Century Learning Cohort Ib (15-16) I ,000 63, , , st Century Learning Cohort Ib (16-17) I , , , ,496 0 Total 21st Century Learning Grant $4,050,000 $164,976 $1,984,989 $1,948,310 $0 $1,479,351 $633,935 $0 Rural and Low Income Schools Title IV Region 3 Partnership Rural Schools (15-16) R3 4, , , Title IV Region 3 Partnership Rural Schools (16-17) R3 5, , , Total Rural and Low Income Schools $9,975 $518 $2,337 $3,650 $0 $3,517 $651 $0 English Language Acquisition Grants Title III - Limited English Region 3 Partnership Adm (15-16) R3 4, , , Title III - Limited English Region 3 Partnership Adm (16-17) R3 37, , , Title III - Limited English SW (16-17) R3 6, , ,289 0 Title III - Immigrant (15-16) ,727 4,826 17,918 7, , Title III - Immigrant (16-17) , , ,322 6,615 0 Title III - Limited English (15-16) ,312 10,228 93,504 18, , Title III - Limited English (16-17) , , ,645 5,660 0 Total English Language Acquisition Grants $333,700 $15,572 $113,759 $129,150 $0 $127,507 $17,215 $0 Improving Teacher Quality Title IIa -Region 3 Partnership Adm (15-16) R3 45,240 4,762 22,950 8, , Title IIa -Region 3 Partnership Adm (16-17) R3 61, , ,464 6,506 0 Title IIa -Teacher & Principal Training (16-17) , , , Total Improving Teacher Quality $109,458 $4,762 $22,950 $39,922 $0 $38,178 $6,506 $0 Total Passed Through Michigan Department of Education $60,476,602 $7,561,578 $36,728,016 $21,730,624 $0 $22,119,537 $7,172,665 $16,184,547 Passed Through Grand Valley State University Special Education - Grants to States A Start Regional (15-16) 2200XX ,000 9,541 18, , Start Regional (16-17) , , ,715 12,786 0 Total Passed Through Grand Valley State University $49,900 $9,541 $18,291 $21,501 $0 $18,256 $12,786 $0-57-

76 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2017 Federal Grantor/Pass-Through Grantor/ Program Title U.S. DEPARTMENT OF EDUCATION (Continued) Passed Through Oakland University Pass- Accrued Current Accrued Transferred to Federal Through Program (Deferred) Prior Current Adjustments Year Cash/ (Deferred) Subrecipients CFDA Project Or Award Revenue Year Year Prior Payments In Revenue as of Number Number Amount July 1, 2016 Expenditures Expenditures Years Kind Received June 30, 2017 June 30, 2017 Investing in Innovation (I3) (15-16) U411B $189,291 $98,315 $98,315 $40,926 $0 $98,315 $40,926 $0 Investing in Innovation (I3) (16-17) 189, , ,997 0 Total Passed Through Oakland University $378,582 $98,315 $98,315 $58,923 $0 $98,315 $58,923 $0 TOTAL U.S. DEPARTMENT OF EDUCATION $60,905,084 $7,669,434 $36,844,622 $21,811,048 $0 $22,236,108 $7,244,374 $16,184,547 U.S. DEPARTMENT OF AGRICULTURE Passed Through Michigan Department of Education School Breakfast Program , ,266 7, , School Breakfast Program , , ,484 11,290 0 National School Lunch Program ,556 2,709 45,066 26, , National School Lunch Program , , ,739 35,292 0 Commodities N/A 3, , , Total Nutrition Cluster $370,030 $3,554 $57,332 $312,698 $0 $269,670 $46,582 $0 Passed Through Michigan Fitness Foundation SNAP-ED (6) (15-16) , , , , , SNAP-ED (6) (15-16) , , , SNAP-ED (7) (16-17) ,000, , , ,345 0 Total Passed Through Michigan Fitness Foundation $2,036,572 $355,760 $802,873 $1,087,847 $0 $1,121,262 $322,345 $0 Fresh Fruits & Vegetables FW , , , TOTAL U.S. DEPARTMENT OF AGRICULTURE $2,409,780 $359,314 $860,205 $1,403,723 $0 $1,393,284 $369,753 $0 U.S. DEPARTMENT OF LABOR Passed Through GSMW/CAIWDASOM WIA Youth Activities WIA Title I Year Round Youth Services (15-16) 135-WIY ,000 15, , , WIA Title I Year Round Youth Services (16-17) WIY , , ,454 12,287 0 WIA Chaffee F.C. and S.S. (15-16) 135-SYEP-16 (S.S) 45,354 6,054 6,054 27, , WIA Chaffee F.C. and S.S. (16-17) WIY , , ,445 0 TOTAL U.S. DEPARTMENT OF LABOR $314,681 $21,884 $112,944 $143,717 $0 $147,869 $17,732 $0 U.S. DEPARTMENT OF JUSTICE Passed Through Michigan State University MSU Safe (6) (15-16) CK-BX ,136 3,153 3,153 24, ,603 5,

77 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2017 Pass- Accrued Current Accrued Transferred to Federal Through Program (Deferred) Prior Current Adjustments Year Cash/ (Deferred) Subrecipients Federal Grantor/Pass-Through Grantor/ CFDA Project Or Award Revenue Year Year Prior Payments In Revenue as of Program Title Number Number Amount July 1, 2016 Expenditures Expenditures Years Kind Received June 30, 2017 June 30, 2017 U.S. DEPARTMENT OF HEALTH & HUMAN SERVICES Direct Grant Head Start - Operations ( ) 05CH8237/04 $107,883 $9,405 $107,883 $0 $0 $9,405 $0 $0 Head Start - Train/Tech ( ) 05CH8327/03 3,029, , ,834 1,406, ,220, ,589 0 Head Start - Operations ( ) 05CH8327/03 10,028, ,592 9,490, , Head Start - Operations ( ) 05CH8327/04 10,209, ,706, ,752,187 1,954,192 0 Head Start - Train/Tech ( ) 05CH8327/04 59, , ,785 0 Head Start - Train/Tech ( ) 05CH8327/04 107, , ,804 27,824 0 Head Start - Train/Tech ( ) 05HP ,110, , ,283 0 Head Start - Train/Tech ( ) 05HP , , ,218 0 Total Head Start $26,781,388 $1,384,729 $10,206,107 $11,273,446 $0 $9,919,284 $2,738,891 $0 Project AWARE! (15-16) H79SM , ,604 27, ,839 6,530 0 CTF Healthy Families CTF Healthy Families (15-16) CTFDS ,000 1,583 14,083 6, , CTF Healthy Families (16-17) CTFDS , , ,638 7,673 0 Total CTF Healthy Families $225,000 $1,583 $14,083 $34,903 $0 $28,813 $7,673 $0 Total Direct Grants $27,056,388 $1,386,996 $10,248,794 $11,336,034 $0 $9,969,936 $2,753,094 $0 Passed Through Genesee County Health Department HV HUB (14-15) MC ,000 2,420 10, , HV HUB (15-16) MC ,300 1,426 7,647 3, , HV HUB (16-17) MC , , ,841 3,598 0 Total Passed Through Genesee County Health Department $77,300 $3,846 $18,265 $10,791 $0 $11,039 $3,598 $0 Passed Through the Michigan Department of Community Health Medical Assistance Program Title XIX Medicaid Outreach (16-17) N/A 115, , , ,896 TOTAL U.S. DEPARTMENT OF HEALTH & HUMAN SERVICES $27,249,510 $1,390,842 $10,267,059 $11,462,647 $0 $10,096,797 $2,756,692 $35,896 TOTAL SCHEDULE OF FEDERAL AWARDS $91,729,191 $9,444,627 $48,087,983 $34,845,880 $0 $33,896,661 $10,393,846 $16,220,

78 - FLINT, MICHIGAN NOTES/RECONCILIATION TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2017 FEDERAL REVENUE RECOGNIZED FOR THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS $34,845,880 FEDERAL REVENUE RECOGNIZED PER THE GENERAL PURPOSE FINANCIAL STATEMENTS General Fund $15,256,826 Special Education Fund 18,008,363 Career Technical Education Fund 1,264,815 Food Service 315,876 TOTAL $34,845,880 1) Basis of Presentation - The accompanying schedule of expenditures of federal awards includes the federal grant activity of Genesee Intermediate School District for the year ended June 30, The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (the "Uniform Guidance"). Because the schedule presents only a selected portion of the operations of Genesee Intermediate School District, it is not intended to and does not present the financial position or changes in net position of Genesee Intermediate School District. 2) Summary of Significant Accounting Policies - Expenditures reported on the schedule are reported on the modified accrual basis of accounting. Expenditures are recognized following the cost principles in OMB Circular A-87 or the Uniform Guidance, as applicable, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts (if any) shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. The District has elected not to use the 10 percent de minimus indirect cost rate to recover indirect costs as allowed under the Uniform Guidance. 3) Management has utilized the Cash Management System (CMS) in preparing the Schedule of Expenditures of Federal Awards. All differences between the Schedule of Expenditures of Federal Awards and the Grant Auditor's Report have been reconciled in the attached reconciliation on page 61 of this report. 4) Noncash Assistance - The value of noncash assistance received was determined in accordance with the provisions is not included on the schedule of expeditures of federal awards. -60-

79 - FLINT, MICHIGAN RECONCILIATION OF "GRANT SECTION AUDITOR'S REPORT" TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2017 Current Payments Per the Grant Auditor's Report - Cash Management System $22,414,719 Add: Recorded on Cash Management in Prior Year but Recorded by District in the Current Yea HAA VII-B Homeless Child Education (CFDA ) $18,195 21st Century Learning Grant (CFDA ) 2,576 Total 20,771 Less: Recorded on Cash Management in Current Year but Recorded by District after June 3 School Breakfast Program (CFDA ) ($11,290) National School Lunch Program (CFDA ) (35,292) Fresh Fruit and Vegetables (CFDA ) (826) Total (47,408) Add: Grants Passed Through Other Agencies Passed Through Grand Valley State University Start Regional (CFDA A) 18,256 Passed Through Oakland University Investing in Innovation (I3) (CFDA ) 98,315 Passed Through Michigan Fitness Foundation Integrated Nutrition Education & Physical Activity-PENUT (CFDA ,121,262 Passed Through GSMW/CAIWDASOM WIA Youth Activities (CFDA ) 147,869 Passed Through Michigan State University MSU Safe (6) (CFDA ) 22,603 Passed Through U.S. Department of Education Project AWARE! (CFDA ) 21,839 Passed Through U.S. Department of Education Headstart (CFDA ) 9,919,284 Passed Through U.S. Department of Education CTF Healthy Families (CFDA ) 28,813 Passed Through Genesee County Health Departmen HV HUB (CFDA ) 11,039 Passed Through the Michigan Department of Community Healt Medical Assistance Program Title XIX (CFDA ) 115,822 Entitlement Commodities 3,477 TOTAL CURRENT YEAR RECEIPTS PER SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS $33,896,

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84 SUMMARY OF FINDINGS AND QUESTIONED COSTS JUNE 30, 2017 SECTION I SUMMARY OF AUDITOR S RESULTS Financial Statements Type of auditor s report issued: Unmodified Internal control over financial reporting: Material weakness(es) identified? Yes No Significant deficiency (ies) identified? Yes No Noncompliance material to financial statements noted? Yes No Federal Awards Internal control over major programs: Material weakness(es) identified? Yes No Significant deficiency (ies) identified? Yes None reported Type of auditor s report issued on compliance for major programs: Unmodified Any audit findings disclosed that are required to be reported in accordance with Section 2 CFR (a)? Yes No Identification of major programs: CFDA Number(s) Name of Federal Program or Cluster , Special Education Cluster / Snap Cluster Dollar threshold use to distinguish between type A and type B programs: $ 1,045,376 Auditee qualified as a low-risk auditee? Yes No SECTION II FINANCIAL STATEMENT FINDINGS There were no findings for the current year. SECTION III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS There were no findings for the current year. There were no findings in either of the prior two years. GENESEE INTERMEDIATE SCHOOL DISTRICT SCHEDULE OF PRIOR AUDIT FINDING FOR THE YEAR ENDED JUNE 30,

85 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS PROVIDED TO SUBRECIPIENTS FOR THE YEAR ENDED JUNE 30, 2017 Federal Federal Subrecipient Subrecipient Due To Subrecipient's Current Year Expenditures Due To Federal Grantor/Program Title/ CFDA Project Award Subrecipients Prior Year Cash Transferred Reported By Subrecipients Subrecipient Number Number Amount July 1, 2016 Expenditures To Subrecipients Subrecipients June 30, 2017 U.S. DEPARTMENT OF EDUCATION (Continued) IDEA Flowthrough (14-15) Atherton Community Schools $233,219 $0 $233,219 $0 $0 $0 Beecher School District , , Bendle Public Schools , , Bentley Community School District ,977 10, ,977 10, Burton Glen Academy , , Carman-Ainsworth School District ,161, ,161, Clio Area Schools , , Davison Community Schools , , Fenton Area Public Schools , , Flint Community Schools ,836, ,674 1,755, , Flushing Community Schools ,742 1, ,731 11,567 10,011 0 Genesee School District , , Genesee STEM ,650 6,916 39,650 6, Goodrich Area Schools , , Grand Blanc Community Schools ,430, ,430, Grand Blanc Academy , , Greater Heights Academy , , International Academy of Flint , , Kearsley Community Schools , , Lake Fenton Community Schools , , LakeVille Community Schools , , Linden Community Schools , , Linden Charter Academy , , Madison Academy ,282 16, ,282 16, Montrose Community Schools , , Mt. Morris Consolidated Schools ,608 25, ,608 25, Northridge Academy , , New Standard Academy , , Richfield Academy , , Swartz Creek Community Schools , , Way Academy , , Westwood Heights Schools , , Woodland Park Academy ,762 3,597 80,762 3, Total IDEA Flowthrough (14-15) $14,618,460 $341,370 $14,527,045 $351,381 $10,011 $0-67-

86 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS PROVIDED TO SUBRECIPIENTS FOR THE YEAR ENDED JUNE 30, 2017 Federal Federal Subrecipient Subrecipient Due To Subrecipient's Current Year Expenditures Due To Federal Grantor/Program Title/ CFDA Project Award Subrecipients Prior Year Cash Transferred Reported By Subrecipients Subrecipient Number Number Amount July 1, 2016 Expenditures To Subrecipients Subrecipients June 30, 2017 U.S. DEPARTMENT OF EDUCATION IDEA Flowthrough (15-16) Atherton Community Schools $208,605 $47,416 $198,726 $57,295 $9,879 $0 Beecher School District ,457 45, ,745 47,306 1,712 0 Bendle Public Schools , , , ,410 28,482 11,833 Bentley Community School District , , , , Burton Glen Academy ,923 32, ,923 32, Carman-Ainsworth School District ,156,947 1,143,064 1,143,064 1,143,064 3,113 3,113 Clio Area Schools , , , , Davison Community Schools , , , , Eagles Nest Academy , , Fenton Area Public Schools , , Flint Community Schools ,722, ,234 1,506, , , ,038 Flushing Community Schools , , , ,516 1,820 0 Genesee School District ,585 1, ,585 1, Genesee STEM ,069 39,069 39,069 39, Goodrich Area Schools ,629 85, ,370 87,041 17,764 15,851 Grand Blanc Community Schools ,503, ,766 1,503, , Grand Blanc Academy ,219 59,773 80,578 62,414 2,641 0 Greater Heights Academy , , International Academy of Flint , , , ,889 8,568 8,568 Kearsley Community Schools , , , , Lake Fenton Community Schools , , , , LakeVille Community Schools , , , , Linden Community Schools , , , , Linden Charter Academy ,731 22, ,731 22, Madison Academy , , , , Montrose Community Schools , , , ,637 23,613 5,142 Mt. Morris Consolidated Schools , , , ,270 42,075 9,178 Northridge Academy ,623 25,426 72,623 25, New Standard Academy ,389 74,389 74,389 74, Richfield Academy ,625 52, ,822 54,313 1,803 0 Swartz Creek Community Schools , , Way Academy ,431 51,169 51,169 51, Westwood Heights Schools ,477 42, ,477 42, Woodland Park Academy ,517 16,534 61,123 43,928 27,394 0 Total IDEA Flowthrough (15-16) $14,677,536 $5,447,373 $14,263,383 $5,562,552 $368,902 $253,

87 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS PROVIDED TO SUBRECIPIENTS FOR THE YEAR ENDED JUNE 30, 2017 Federal Federal Subrecipient Subrecipient Due To Subrecipient's Current Year Expenditures Due To Federal Grantor/Program Title/ CFDA Project Award Subrecipients Prior Year Cash Transferred Reported By Subrecipients Subrecipient Number Number Amount July 1, 2016 Expenditures To Subrecipients Subrecipients June 30, 2017 U.S. DEPARTMENT OF EDUCATION IDEA Flowthrough (16-17) Atherton Community Schools $237,972 $0 $0 $172, ,420 $35,916 Beecher School District , , ,819 42,367 Bendle Public Schools , , , ,950 Bentley Community School District , , ,643 39,648 Burton Glen Academy , , ,228 24,268 Carman-Ainsworth School District ,151, ,015,731 1,015,731 Clio Area Schools , , , ,331 Davison Community Schools ,007, ,878 1,007, ,078 Eagles Nest Academy , ,972 10,972 0 Fenton Area Public Schools , , , ,353 Flint Community Schools ,639, ,159 1,613, ,800 Flushing Community Schools , , , ,837 Genesee School District , , ,660 50,148 Genesee STEM , ,861 32,764 3,903 Goodrich Area Schools , , ,796 64,734 Grand Blanc Community Schools ,525, ,368,638 1,525, ,878 Grand Blanc Academy , ,345 90,404 15,059 Greater Heights Academy , ,924 50,924 0 International Academy of Flint , , , ,412 Kearsley Community Schools , , , ,264 Lake Fenton Community Schools , , ,748 78,160 LakeVille Community Schools , , ,228 77,548 Linden Community Schools , , , ,776 Linden Charter Academy , , ,804 21,473 Madison Academy , , ,564 Montrose Community Schools , , , ,410 Mt. Morris Consolidated Schools , , , ,804 Northridge Academy , ,574 63,636 22,062 New Standard Academy , ,876 90,876 Richfield Academy , , ,514 39,575 Swartz Creek Community Schools , , , ,576 Way Academy , ,107 90,876 25,769 Westwood Heights Schools , , ,585 66,187 Woodland Park Academy , ,713 69,713 0 Total IDEA Flowthrough (16-17) $15,207,952 $0 $0 $9,743,706 $14,766,163 $5,022,

88 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS PROVIDED TO SUBRECIPIENTS FOR THE YEAR ENDED JUNE 30, 2017 Federal Federal Subrecipient Subrecipient Due To Subrecipient's Current Year Expenditures Due To Federal Grantor/Program Title/ CFDA Project Award Subrecipients Prior Year Cash Transferred Reported By Subrecipients Subrecipient Number Number Amount July 1, 2016 Expenditures To Subrecipients Subrecipients June 30, 2017 U.S. DEPARTMENT OF EDUCATION (Continued) Secondary Regional Allocation (15-16) Carman-Ainsworth School District $11,932 $0 $11,450 $0 $0 $0 Clio Area Schools , , Davison Community Schools ,400 30, ,497 30, Fenton Area Public Schools , , Flint Community Schools ,071 3,397 20,789 3, Flushing Community Schools ,050 3,200 21,341 3, Genesee Early College Goodrich Area Schools , , Grand Blanc Community Schools ,542 14, ,485 14, Kearsley Community Schools , , Lake Fenton Schools , , Montrose Community Schools , , Mt. Morris Consolidated Schools , , Shiawassee RESD ,539 29, ,762 29, Swartz Creek Community Schools ,820 1,903 14,003 1, Westwood Heights School District , , Total Secondary Regional Allocation (15-16) $679,079 $83,159 $648,909 $83,159 $0 $0 Secondary Regional Allocation (16-17) Carman-Ainsworth School District , ,277 38,277 0 Clio Area Schools , ,409 12,409 0 Davison Community Schools , ,052 85,906 5,854 Fenton Area Public Schools , ,131 36, Flint Community Schools , ,279 4,895 Flushing Community Schools , ,703 22,856 3,153 Genesee Early College Goodrich Area Schools , ,960 3,960 0 Grand Blanc Community Schools , , ,756 18,785 Kearsley Community Schools , ,546 13,546 0 Lake Fenton Schools , ,229 12,229 0 Montrose Community Schools , ,420 3,000 1,580 Mt. Morris Consolidated Schools , ,290 1,290 0 Shiawassee RESD , , ,109 86,364 Swartz Creek Community Schools Westwood Heights School District , ,750 5,750 0 Total Secondary Regional Allocation (16-17) $698,837 $0 $0 $535,867 $657,013 $121,

89 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS PROVIDED TO SUBRECIPIENTS FOR THE YEAR ENDED JUNE 30, 2017 Federal Federal Subrecipient Subrecipient Due To Subrecipient's Current Year Expenditures Due To Federal Grantor/Program Title/ CFDA Project Award Subrecipients Prior Year Cash Transferred Reported By Subrecipients Subrecipient Number Number Amount July 1, 2016 Expenditures To Subrecipients Subrecipients June 30, 2017 U.S. DEPARTMENT OF EDUCATION (Continued) IDEA Preschool Incentive (14-15) Beecher School District $1,619 $1,619 $1,619 $1,619 $0 $0 Bendle Public Schools , Burton Glen Academy , Carman-Ainsworth School District , Clio Area Schools , Davison Community Schools , Fenton Area Public Schools , Flint Community Schools ,039 8,665 8,665 8, Flushing Community Schools , Genesee School District ,879 2,005 2,005 2, Goodrich Area Schools , Grand Blanc Community Schools , International Academy ,659 5,084 5,084 5, Kearsley Community Schools , , LakeVille Community Schools , Montrose Community Schools , Mt. Morris Consolidated Schools ,289 4,038 4,038 4, Richfield Public Academy , ,338 5,338 0 Swartz Creek Community Schools , Westwood Heights , Total IDEA Preschool Incentive (14-15) $369,340 $21,628 $24,026 $26,966 $5,338 $0 IDEA Preschool Incentive (15-16) Beecher School District , , Bendle Public Schools ,892 7,862 18,892 7, Burton Glen Academy , , Carman-Ainsworth School District ,812 19,812 19,812 19, Clio Area Schools ,088 6,930 19,088 6, Davison Community Schools ,052 5,150 27,052 5, Fenton Area Public Schools , ,976 1,171 1,048 0 Flint Community Schools ,528 9,774 62,528 9, Flushing Community Schools , , Genesee School District ,712 1,712 1,712 1, Goodrich Area Schools ,056 1,781 6,056 1, Grand Blanc Community Schools ,944 50,944 50,944 50, International Academy , ,982 1,982 Kearsley Community Schools ,812 5,082 19,812 5, LakeVille Community Schools ,056 3,587 5,531 4, Montrose Community Schools ,572 5,130 12,572 5, Mt. Morris Consolidated Schools ,572 11,450 11,450 12,572 1,122 0 Richfield Public Academy ,884 3,884 3,884 3, Swartz Creek Community Schools , , Westwood Heights , Total IDEA Preschool Incentive (15-16) $366,888 $133,221 $357,873 $135,916 $4,677 $1,

90 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS PROVIDED TO SUBRECIPIENTS FOR THE YEAR ENDED JUNE 30, 2017 Federal Federal Subrecipient Subrecipient Due To Subrecipient's Current Year Expenditures Due To Federal Grantor/Program Title/ CFDA Project Award Subrecipients Prior Year Cash Transferred Reported By Subrecipients Subrecipient Number Number Amount July 1, 2016 Expenditures To Subrecipients Subrecipients June 30, 2017 U.S. DEPARTMENT OF EDUCATION (Continued) IDEA Preschool Incentive (16-17) Beecher School District $4,770 $0 $0 $0 $1,525 1,525 Bendle Public Schools , ,652 24,936 10,284 Burton Glen Academy , ,770 4,770 Carman-Ainsworth School District , ,432 18,432 Clio Area Schools , ,878 13,878 0 Davison Community Schools , ,006 34,371 5,365 Fenton Area Public Schools , ,973 33,287 7,314 Flint Community Schools , ,832 57,900 15,068 Flushing Community Schools , ,029 26,774 8,745 Genesee School District , ,011 4,011 0 Goodrich Area Schools , ,011 4,011 Grand Blanc Community Schools , ,248 39,684 13,436 International Academy , Kearsley Community Schools , ,835 25,263 6,428 LakeVille Community Schools , ,802 8,565 3,763 Montrose Community Schools , ,194 14,960 5,766 Mt. Morris Consolidated Schools , ,904 18,432 5,528 Richfield Public Academy , ,227 4,227 Swartz Creek Community Schools , ,613 37,407 30,794 Westwood Heights , Total IDEA Preschool Incentive (16-17) $394,551 $0 $0 $226,977 $372,433 $145,456 TOTAL U.S. DEPARTMENT OF EDUCATION $47,012,643 $6,026,751 $29,821,236 $16,666,524 $16,184,537 $5,544,

91 - FLINT, MICHIGAN SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS PROVIDED TO SUBRECIPIENTS FOR THE YEAR ENDED JUNE 30, 2017 Federal Federal Subrecipient Subrecipient Due To Subrecipient's Current Year Expenditures Due To Federal Grantor/Program Title/ CFDA Project Award Subrecipients Prior Year Cash Transferred Reported By Subrecipients Subrecipient Number Number Amount July 1, 2016 Expenditures To Subrecipients Subrecipients June 30, 2017 U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES Medical Assistance Program Title XIX Medicaid Outreach (16-17) Atherton Community Schools N/A $1,424 $717 $717 $717 $401 $401 Beecher School District N/A Bendle Public Schools N/A 2,719 1,704 1,704 1,117 1,117 1,704 Bentley Community Schools N/A 1, Carman-Ainsworth School District N/A 8,544 4,220 4,220 3,683 3,683 4,220 Clio Area Schools N/A 2,955 1,568 1,568 1,572 1,572 1,568 Davison Community Schools N/A 7,163 3,934 3,934 5,055 5,055 3,934 Fenton Area Public Schools N/A 3,576 1,976 1,976 2,136 2,136 1,976 Flint Community Schools N/A 18,105 5,208 5,208 4,189 4,189 5,208 Flushing Community Schools N/A 2,955 1,174 1,174 1,344 1,344 1,174 Genesee School District N/A Goodrich Area Schools N/A 1, ,070 1, Grand Blanc Community Schools N/A 5,707 2,383 2,383 2,653 2,653 2,383 International Academy N/A Kearsley Community Schools N/A 3,330 1,823 1,823 2,160 2,160 1,823 Lake Fenton Community Schools N/A 1, ,023 1, LakeVille Community Schools N/A 1, ,020 1, Linden Community Schools N/A 4,572 2,293 2,293 2,722 2,722 2,293 Montrose Community Schools N/A Mt Morris Consolidated Schools N/A 3,458 1,162 1, ,162 Northridge Academy N/A Richfield Academy N/A Swartz Creek Community Schools N/A 2,901 1,547 1,547 1,877 1,877 1,547 Westwood Heights Schools N/A Total Medicaid Outreach (16-17) $76,352 $33,508 $33,508 $36,212 $35,896 $33,192 TOTAL SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS PROVIDED TO SUBRECIPIENTS $47,088,995 $6,060,259 $29,854,744 $16,702,736 $16,220,433 $5,577,

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