Ratings: Moody s: Aa2 See RATING herein. NEW ISSUE BOOK-ENTRY FORM ONLY

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1 NEW ISSUE BOOK-ENTRY FORM ONLY Ratings: Moody s: Aa2 See RATING herein. In the opinion of Bricker & Eckler LLP, Bond Counsel, under existing law, (i) assuming continuing compliance with certain covenants and the accuracy of certain representations, interest on the Series 2017 Notes is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations under the Internal Revenue Code of 1986, as amended (the Code ), and (ii) interest on and any profit made on the sale, exchange or other disposition of the Series 2017 Notes is exempt from certain taxes levied by the State of Ohio and its political subdivisions. The Library has designated the Series 2017 Notes as qualified tax-exempt obligations within the meaning of Section 265(b)(3) of the Code. Interest on the Series 2017 Notes may be subject to certain federal income taxes imposed on certain corporations, and certain taxpayers may have certain other adverse federal income tax consequences as a result of owning the Series 2017 Notes. For a more complete discussion of the tax aspects, see TAX MATTERS. Dated: Date of Delivery OFFICIAL STATEMENT $8,465,000 COLUMBUS METROPOLITAN LIBRARY FRANKLIN COUNTY, OHIO LIBRARY FUND LIBRARY FACILITIES REFUNDING NOTES, SERIES 2017 (Special Obligation) Due: December 1, as shown on the inside cover The Library Fund Library Facilities Notes, Series 2017 (the Series 2017 Notes ) are special obligations of the Columbus Metropolitan Library, Franklin County, Ohio (the Library ), secured by a pledge of the Library s allocation from the Public Library Fund as described herein. The Series 2017 Notes are not secured by the full faith and credit of the Library or by any revenues of the Library other than those which are specially pledged. (See SECURITY AND SOURCE OF PAYMENT FOR THE LIBRARY S SPECIAL OBLIGATION DEBT herein.) Terms used herein with initial capitalization where the rules of grammar would not otherwise so require and not defined have the meanings given to them umber DEFINITIONS. Interest on the Series 2017 Notes will be payable at the respective rates shown on the inside cover herein on June 1 and December 1 of each year beginning June 1, 2018, to the Noteholders of record as of the record dates described in the Note Resolution (as defined herein). Principal of the Series 2017 Notes will be payable at the designated corporate trust office of The Huntington National Bank, Columbus, Ohio, as registrar, paying agent and transfer agent for the Series 2017 Notes. The Series 2017 Notes will be issuable as fully registered Notes without coupons in the denominations set forth herein. The Series 2017 Notes will be issuable under a book entry only method and registered in the name of The Depository Trust Company ( DTC ) or its nominee. There will be no physical delivery of the Series 2017 Notes to the ultimate purchasers. The Underwriter has satisfied the requirements of DTC for the Series 2017 Notes to be eligible for its book-entry services. (See BOOK-ENTRY ONLY SYSTEM herein.) The Current Interest Notes are not subject to optional redemption prior to stated maturity. (See THE SERIES 2017 NOTES - Redemption Provisions herein.) The Series 2017 Notes are offered when, as and if issued and received by Stifel, Nicolaus & Company, Incorporated (the Underwriter ), subject to prior sale and to withdrawal or modification of the offer without notice. Certain legal matters relating to the issuance of the Series 2017 Notes are subject to the approving opinion of Bricker & Eckler LLP, Bond Counsel, Columbus, Ohio. (See LEGAL MATTERS and TAX MATTERS herein.) This cover page contains certain information for general reference only. It is not a summary of the provisions of the Series 2017 Notes. Investors must read the entire Official Statement to obtain information essential to the making of an informed investment decision. This Official Statement has been prepared by the Columbus Metropolitan Library in connection with the original offering for sale by it of the Series 2017 Notes. It is expected that delivery of the Series 2017 Notes in definitive form will be made on or about November 28, The date of this Official Statement is November 8, 2017, and the information herein speaks only as of that date.

2 $8,465,000 COLUMBUS METROPOLITAN LIBRARY FRANKLIN COUNTY, OHIO LIBRARY FUND LIBRARY FACILITIES REFUNDING NOTES, SERIES 2017 (Special Obligation) Year Principal Maturing $8,465,000 SERIAL NOTES Interest Rate Price CUSIP 2018 $ 30, % BB , BC , BD , BE , BF ,685, BG , BH ,340, BJ ,385, BK2 Copyright 2017 CUSIP Global Services.

3 $8,465,000 COLUMBUS METROPOLITAN LIBRARY FRANKLIN COUNTY, OHIO LIBRARY FUND LIBRARY FACILITIES REFUNDING NOTES, SERIES 2017 (Special Obligation) Board of Library Trustees Tim Frommeyer Board President Katie Chatas Board Secretary Kevin Reeves Trustee Mike Duffy Board Vice President Erika Clark Jones Trustee Cindy Hilsheimer Trustee Roger Sugarman Trustee Executive Staff Patrick Losinski Chief Executive Officer Paula Miller Chief Financial Officer/Fiscal Officer Stewart Smith Deputy Fiscal Officer Professional Services Stifel, Nicolaus & Company, Incorporated Underwriter Bricker & Eckler LLP Bond Counsel The Huntington National Bank Paying Agent/Note Registrar/Escrow Trustee/Trustee Causey Demgen & Moore P.C. Verification Agent

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5 REGARDING THIS OFFICIAL STATEMENT This Official Statement does not constitute an offering of any security other than the original offering of the Library Fund Library Facilities Refunding Notes, Series 2017 (the Notes ) of the Columbus Metropolitan Library, Franklin County, Ohio (the Library ) identified on the cover hereof. No person has been authorized by the Library to give any information or to make any representations other than those contained in this Official Statement, and if given or made, such other information or representation must not be relied upon as having been given or authorized by the Library. Statements contained in this Official Statement that involve estimates, forecasts, or matters of opinion, whether or not expressly described herein, are intended solely as such and are not to be construed as representations of facts. The information set forth herein has been obtained from the Library and other sources that are believed to be reliable for purposes of this Official Statement. This Official Statement contains, in part, estimates and matters of opinion that are not intended as statements of fact, and no representation is made as to the correctness of such estimates and opinions or that they will be realized. The information and expressions of opinions herein are subject to change without notice and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Library since the date hereof. In accordance with Section (f)(3) of the Rule, the Library may provide additional or updated financial information and/or operating data about the Library in a document or documents filed on the Municipal Securities Rulemaking Board's Electronic Municipal Market Access ( EMMA ) website, and any such documents are hereby included by specific reference through the date that the Notes are delivered to DTC. Certain information located at websites referred to herein has been prepared by the respective entities responsible for maintaining such websites. The Library takes no responsibility for the continued accuracy of any internet address or the accuracy, completeness, or timeliness of any information posted at any such address. In the absence of an express statement to the contrary, none of such information is incorporated herein by reference. CUSIP data on the Cover has been provided by CUSIP Global Services, which is managed on behalf of the American Bankers Association ( ABA ) by S&P Global Market Intelligence, a division of S&P Global Inc. CUSIP is a registered trademark of the ABA. The CUSIP data is being provided solely for the convenience of the owners of the Notes and only at the time of issuance of the Notes. The Library, Bond Counsel, and the Underwriter are not responsible for the selection or use of these CUSIP numbers and make no representation with respect to such data or undertake any responsibility for its accuracy now or at any time in the future. CUSIP numbers are subject to being changed after the issuance of the Notes as a result of subsequent actions and events. Certain information in this official statement is attributed to the Ohio Municipal Advisory Council ( OMAC ). OMAC compiles information from official and other sources. OMAC believes the information it compiles is accurate and reliable, but OMAC does not independently confirm or verify the information and does not guarantee its accuracy. OMAC has not reviewed this Official Statement to confirm that the information attributed to it is information provided by OMAC or for any other purpose. Stifel, Nicolaus & Company, Incorporated (the Underwriter ) has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information. iii

6 UPON ISSUANCE, THE SERIES 2017 NOTES WILL NOT BE REGISTERED BY THE LIBRARY UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAW OF ANY STATE, AND WILL NOT BE LISTED ON ANY STOCK OR OTHER SECURITIES EXCHANGE. THE SERIES 2017 NOTES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, NOR HAS ANY OTHER FEDERAL, STATE, MUNICIPAL OR OTHER GOVERNMENTAL ENTITY OR AGENCY, EXCEPT THE BOARD OF TRUSTEES OF THE LIBRARY, PASSED UPON THE ACCURACY OR ADEQUACY OF THIS OFFICIAL STATEMENT OR APPROVED THE SERIES 2017 NOTES FOR SALE. THIS OFFICIAL STATEMENT DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY, AND THERE SHALL NOT BE ANY SALE OF, THE SERIES 2017 NOTES BY ANY PERSON IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH OFFER, SOLICITATION OR SALE. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SERIES 2017 NOTES AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THE UNDERWRITER MAY OFFER AND SELL THE SERIES 2017 NOTES TO CERTAIN DEALERS, DEALER BANKS AND BANKS ACTING AS AGENT AT PRICES LOWER THAN THE PUBLIC OFFERING PRICE STATED ON THE COVER AND SAID PUBLIC OFFERING PRICE MAY BE CHANGED FROM TIME TO TIME BY THE UNDERWRITER. General INVESTMENT CONSIDERATIONS The Series 2017 Notes, like all obligations of state and local governments, are subject to changes in value due to changes in the condition of the market for tax-exempt obligations or changes in the financial position of the Library. It is possible under certain market conditions, or if the financial condition of the Library should change, that the market price of the Series 2017 Notes could be adversely affected. With regard to the risk involved in a downward revision or withdrawal of the rating on the Series 2017 Notes shown on the cover, see RATING. With regard to the risk involved in a loss of the exclusion from gross income for purposes of federal income taxation of interest payable on the Series 2017 Notes, see TAX MATTERS. Prospective purchasers of the Series 2017 Notes should consult their own tax advisors prior to any purchase of the Series 2017 Notes as to the impact of the Code, upon their acquisition, holding or disposition of the Series 2017 Notes. Investment Suitability of Tax-Exempt Obligations A primary test of the suitability of a tax-exempt obligation for an individual investor is a comparison of the yield the investor would have to earn on a taxable obligation to equal a tax-exempt yield in his or her income tax bracket. Individuals should consult with brokers or qualified financial or tax advisors to determine the taxable equivalent yield they could expect given their particular tax circumstances. iv

7 Prepayments of Principal The Series 2017 Notes allow the Library to prepay certain principal maturities of the Series 2017 Notes without penalty. (See THE SERIES 2017 NOTES Redemption Provisions. ) If such Notes were to be prepaid before scheduled maturity, the investor would not receive the anticipated yield through the scheduled maturity date. In such a prepayment situation there is no guarantee that the investor could reinvest the proceeds and receive a comparable yield for the period remaining until the scheduled maturity of the Series 2017 Notes. The investor, therefore, may receive a lower total return for the period beginning on the date of purchase through the scheduled date of maturity than anticipated. [Balance of Page Intentionally Left Blank] v

8 NOTE ISSUE SUMMARY The information contained in this Note Issue Summary is qualified in its entirety by the entire Official Statement, which should be reviewed in its entirety by potential investors. Issuer: Columbus Metropolitan Library, Franklin County, Ohio Issue: $8,465,000 Library Fund Library Facilities Refunding Notes, Series 2017 (the Series 2017 Notes ) Dated Date: Date of Delivery Interest Interest on Notes will be paid each June 1 and December 1, beginning June 1, Payment Dates: Principal Payment Dates: Serial Notes: December 1, 2018 through December 1, 2023, inclusive and December 1, 2026 through December 1, 2027, inclusive Redemption: Purpose: Security: Credit Rating: Tax Matters: Bank Qualification: Legal Opinion: Underwriter: Note Registrar, Paying Agent and Trustee: Verification Agent: Book-Entry System: The Series 2017 Notes are not subject to redemption prior to stated maturity See THE SERIES 2017 NOTES - Redemption Provisions herein. The Series 2017 Notes are issued for the purpose of advance refunding a portion of the Library s $71,925,000 Library Fund Library Facilities Notes, Series , dated December 4, The Series 2017 Notes will be special obligations of the Library and the principal of and interest on the Series 2017 Notes is payable solely from the pledge of the Library s allocation from the Public Library Fund, as defined herein. The Library has applied for a rating of the Series 2017 Notes from Moody s Investors Service, Inc. ( Moody s ), which has rated the Series 2017 Notes Aa2. In the opinion of Bond Counsel, under existing law and assuming compliance with certain covenants, interest on the Series 2017 Notes is excluded from gross income for federal income tax purposes, is not treated as an item of tax preference for purposes of the alternative minimum income tax imposed on individuals and corporations under the Internal Revenue Code of 1986, as amended (the Code ), and is exempt from certain taxes imposed by the State and its political subdivisions. Interest on the Series 2017 Notes may be subject to certain federal income taxes imposed on certain corporations, and certain taxpayers may have certain other adverse federal income tax consequences as a result of owning the Series 2017 Notes. (See TAX MATTERS. ) The Library has designated the Series 2017 Notes as qualified tax exempt obligations within the meaning of Section 265(b)(3) of the Code. Bricker & Eckler LLP, Columbus, Ohio Stifel, Nicolaus & Company, Incorporated The Huntington National Bank, Columbus, Ohio Causey Demgen & Moore, P.C. The Series 2017 Notes are being issued as fully registered Notes in book entry form only and book-entry interests therein will be available for purchase in amounts of $5,000 and integral multiples thereof. Owners of book entry interests will not receive physical delivery of Note certificates. The Depository Trust Company or its nominee will receive all payments with respect to the Series 2017 Notes from the Paying Agent and Registrar. The Depository Trust Company is required by its rules and procedures to remit such payments to its participants for subsequent disbursement to owners of the book entry interests. vi

9 Delivery and Payment: Library Official: It is expected that delivery of the Series 2017 Notes in definitive form will be made on or about November 28, The Series 2017 Notes will be released to the Underwriter against payment in federal funds. Questions concerning the Official Statement should be directed to Paula Miller, Chief Financial Officer/Fiscal Officer, Columbus Metropolitan Library, 96 South Grant Avenue, Columbus, Ohio 43215, telephone: (614) [Balance of Page Intentionally Left Blank] vii

10 TABLE OF CONTENTS REGARDING THIS OFFICIAL STATEMENT... iii INVESTMENT CONSIDERATIONS... iv General... iv Investment Suitability of Tax-Exempt Obligations... iv Prepayments of Principal... v NOTE ISSUE SUMMARY... vi TABLE OF CONTENTS... viii INTRODUCTORY STATEMENT... 1 DEFINITIONS... 2 THE SERIES 2017 NOTES... 3 Authorization and Purpose... 3 Form and Terms... 4 Redemption Provisions... 4 ESTIMATED SOURCES AND USES OF FUNDS... 4 SECURITY AND SOURCE OF PAYMENT FOR THE LIBRARY S SPECIAL OBLIGATION DEBT... 5 Public Library Fund Receipts... 5 Supplemental Trust Agreement... 5 Library Bankruptcy... 6 UNDERWRITING... 6 RATING... 7 LITIGATION... 7 LEGAL MATTERS... 8 TAX MATTERS... 8 General... 8 Original Issue Discount... 9 Amortizable Note Premium VERIFICATION OF ARITHMETICAL AND MATHEMATICAL COMPUTATIONS BOOK-ENTRY ONLY SYSTEM Revision of Book-Entry Only System - Replacement Notes TRANSCRIPT AND CLOSING DOCUMENTS CONTINUING DISCLOSURE CONCLUDING STATEMENT APPENDIX A THE COLUMBUS METROPOLITAN LIBRARY... A-1 General Information... A-1 Library Programs and Customers... A-2 Signature Programs and Strategic Partnerships... A-3 Board of Library Trustees... A-5 Library Employees and Pension Obligations... A-6 Library Facilities... A-7 Library Facilities upon Completion of Project... A-8 ECONOMY AND EMPLOYMENT... A-9 Labor Force Statistics... A-9 Largest Employers... A-10 FINANCES OF THE LIBRARY... A-11 Financial Reports and Examination of Accounts... A-11 General Fund Operations... A-11 Revenues and Expenditures... A-12 viii

11 Budgeting, Tax Levy and Appropriations Procedures... A-12 Library Insurance... A-13 THE PUBLIC LIBRARY FUND AND OTHER REVENUE SOURCES... A-14 General... A-14 Public Library Fund... A-14 PLF Distributions... A-15 Library Property Tax Base... A-17 Other Revenues... A-23 LIBRARY DEBT... A-23 Statutory Debt Limitations... A-23 Library Debt Currently Outstanding... A-23 Debt Service Requirements... A-24 Lease Obligations... A-24 Future Financings... A-25 APPENDIX B Audited Financial Statements for the Fiscal Year Ended December 31, B-1 APPENDIX C Form of Approving Legal Opinion of Bricker & Eckler LLP... C-1 APPENDIX D Sample Closing Certificate... D-1 APPENDIX E Form of Continuing Disclosure Certificate... E-1 ix

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13 $8,465,000 COLUMBUS METROPOLITAN LIBRARY FRANKLIN COUNTY, OHIO LIBRARY FUND LIBRARY FACILITIES REFUNDING NOTES, SERIES 2017 (Special Obligation) INTRODUCTORY STATEMENT This Official Statement has been prepared by the Board of Library Trustees (the Board ) of the Columbus Metropolitan Library, Franklin County, Ohio (the Library ), in connection with the original issuance and sale by the Library of the Series 2017 Notes identified on the Cover. All financial and other information presented herein has been provided by the Library from its records, except for information expressly attributed to other sources. The presentation of information, including tables of receipts from taxes and other sources, is intended to show recent historic information, and is not intended to indicate future or continuing trends in the financial position or other affairs of the Library. No representation is made that past experience, as might be shown by such financial and other information, will necessarily continue or be repeated in the future. Certain statements contained in this Official Statement, including, without limitation, statements containing the words believes, anticipates, expects and words of similar import, involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Library to be materially different from any future results, performance or achievements expressed or implied by such statements. Such factors include, among others, general economic conditions, demographic changes, and existing government regulations and changes in, or the failure to comply with, government regulations. Certain of these factors are discussed in more detail elsewhere in this Official Statement. Given these uncertainties, readers of this Official Statement and investors are cautioned not to place undue reliance on such forward-looking statements. This Official Statement should be considered in its entirety and no subject discussed should be considered less important than any other subject by reason of its location in the text. Reference should be made to laws, reports or documents referred to for more complete information regarding their contents. References herein to provisions of Ohio law, (whether codified in the Ohio Revised Code or uncodified, the Ohio Constitution, or federal law) are references to such provisions as they presently exist. Provisions of Ohio law, the Ohio Constitution and federal law may in the future, and from time to time, be amended, repealed or supplemented. Additional information relating to the financial condition of the Library may be obtained by contacting the Chief Financial Officer/Fiscal Officer, Paula Miller, Columbus Metropolitan Library, 96 South Grant Avenue, Columbus, Ohio 43215, telephone (614)

14 DEFINITIONS The following capitalized terms, as used in this Official Statement and the Appendices attached hereto, have the following meanings unless otherwise indicated: Annual Report means any annual report provided by the Library referred to in this Official Statement and any appendix hereto, which Annual Reports are intended to satisfy the annual financial information requirements of the Rule and Section (b)(5)(i)(a) therein. Bankruptcy Code means Title 11 of the United States Code. Board means the Board of Library Trustees. Bond Counsel means Bricker & Eckler LLP. Chief Financial Officer or Fiscal Officer means the Chief Financial Officer or Fiscal Officer of the Board. City means the City of Columbus, Ohio. Code means the Internal Revenue Code of 1986, as amended. County means Franklin County, Ohio. County Auditor means the County Auditor of the County. County Treasurer means the County Treasurer of the County. Cover means the cover page and the inside cover of this Official Statement. Fiscal Year means the 12-month period ending December 31, and reference to a particular Fiscal Year (such as Fiscal Year 2018 ) means the Fiscal Year ending on December 31 in that year. Library means the Columbus Metropolitan Library, Franklin County, Ohio. MSA or Columbus MSA means the Columbus Metropolitan Statistical Area, as defined by the United States Office of Management and Budget, including Delaware, Fairfield, Franklin, Hocking, Licking, Madison, Morrow, Perry, Pickaway, and Union Counties. Note Registrar means The Huntington National Bank. Notes or Series 2017 Notes means the Library s $8,465,000 Library Fund Library Facilities Refunding Notes, Series 2017, dated November 28, OMAC means the Ohio Municipal Advisory Council. Outstanding Notes means the Library s $71,925,000 Library Fund Library Facilities Notes, Series , dated December 4, Refunded Notes means $9,155,000 in aggregate principal amount of the Library s Outstanding Notes maturing December 1, 2023, December 1, 2026 and December 1,

15 Revised Code means the Ohio Revised Code, as amended. Rule means Rule 15c2-12, and particularly Section (b)(5) therein, adopted by the United States Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. Series 2012 Notes means the Library s $92,285,000 Library Fund Library Facilities Notes, Series 2012, dated December 4, 2012, consisting of the Outstanding Notes and the Library s $20,360,000 Library Fund Library Facilities Notes, Series (Federally Taxable). State or Ohio means the State of Ohio. State Auditor means the Auditor of the State. State Superintendent means the State Superintendent of Public Instruction. Tax Commissioner means the Tax Commissioner of the State. Underwriter means Stifel, Nicolaus & Company, Incorporated. Authorization and Purpose THE SERIES 2017 NOTES The Series 2017 Notes are authorized by a resolution of the Board passed on September 28, 2017 (the Note Resolution ). The Series 2017 Notes are issued pursuant to Section of the Revised Code and are, therefore, lawful investments for banks, savings and loan associations, credit union share guaranty corporations, trust companies, trustees, fiduciaries, insurance companies, including domestic for life and domestic not for life, trustees or other officers having charge of sinking and bond retirement or other funds of the State, subdivisions and taxing districts, the Commissioners of the Sinking Fund of the State, the Administrator of Workers Compensation, the State Teachers, Public Employees, and School Employees Retirement Systems, and the Police and Firemen s Disability and Pension Fund, and are eligible as security for the repayment of the deposit of public moneys. The Series 2017 Notes are issued for advance refunding a portion of the Library s $71,925,000 Library Fund Library Facilities Notes, Series , dated December 4, 2012 (the Refunded Notes ). The Refunded Notes were originally issued for the purpose of purchasing, leasing, constructing, renovating and improving library facilities and real property and paying the costs of other property referred to in Revised Code Section (C) (the Project ). A portion of the proceeds of the sale of the Notes will be deposited in the Escrow Fund within the Library s Bond Retirement Fund and will be used to advance refund the Refunded Notes. The Escrow Fund will be held by The Huntington National Bank, as escrow trustee (the Escrow Trustee ). Monies in the Escrow Fund will be invested in direct obligations of or obligations guaranteed as to payment by the United States of America and applied, by the Escrow Trustee, to pay debt service on the Refunded Notes and to redeem the Refunded Notes on their earliest optional redemption date. Under Ohio law, the final maturity of the Series 2017 Notes cannot be later than the final maturity of the Refunded Notes (December 1, 2027). 3

16 Form and Terms The Series 2017 Notes will be issued in fully registered form and the Series 2017 Notes (as shown on the cover) will bear interest from their dated date until maturity or earlier redemption, at the rates per annum as set forth on the Cover, payable on June 1 and December 1 of each year, commencing June 1, 2018, and will mature on December 1 in the years as indicated on the Cover. The Series 2017 Notes will be issued in denominations of $5,000 or any integral multiple thereof, provided that, so long as the Notes shall be in book-entry form and held by a depository, each Note will be of a single maturity, and will be numbered as determined by the Chief Financial Officer/Fiscal Officer. Principal of the Series 2017 Notes (as shown on the Cover) will be payable at maturity, in lawful money of the United States of America, at the designated corporate trust office of The Huntington National Bank, Columbus, Ohio, which has been designated by the Board as the note registrar, paying agent, and transfer agent for the Series 2017 Notes (the Note Registrar ). Interest on the Series 2017 Notes will be payable to the person whose name appears as the registered holder thereof on the registration records maintained by the Note Registrar, on the respective Record Date (15th day next preceding an interest payment date) by check mailed to such registered holder at the address of such registered holder as it appears on the registration records. No deduction shall be made for exchange, collection, or service charges. Redemption Provisions The Notes are not subject to redemption prior to the stated maturity. ESTIMATED SOURCES AND USES OF FUNDS The proceeds of the Series 2017 Notes, other than any accrued interest (which will be deposited in the Library s Note Retirement Fund and used to pay interest on the Series 2017 Notes), will be applied as follows: Sources Par value of the Series 2017 Notes $8,465, Original issue premium 1,458, Total Sources $9,923, Uses Deposit to Escrow Fund $9,805, Costs of issuance * 117, Total Uses $9,923, * Includes Underwriter s compensation, rating fees, printing and distribution costs, bond registrar, trustee, and escrow trustee fees, verification agent fees, legal fees, and miscellaneous expenses. 4

17 SECURITY AND SOURCE OF PAYMENT FOR THE LIBRARY S SPECIAL OBLIGATION DEBT The Series 2017 Notes are special obligations of the Library, secured by a pledge of the Library s allocation of the Public Library Fund (the PLF ) pursuant to Section of the Ohio Revised Code. The Series 2017 Notes are not secured by the full faith and credit of the Library or by any revenues of the Library other than those which are specially pledged. Public Library Fund Receipts Revised Code Section permits a board of public library trustees that receives an allocation of the PLF pursuant to Section and Chapter 5747 of the Revised Code to anticipate a portion of its proceeds from the PLF distribution, and available proceeds of a property tax levied under Revised Code Section , and issue library fund library facilities notes to finance the purchase of real or personal property, including motor vehicles, and the purchase, construction and renovation of buildings and additions to buildings necessary for the proper maintenance and operation of the libraries under its control. A series of notes may be issued only if the maximum aggregate amount of notes that will be outstanding after such issue does not exceed an amount which requires or is estimated to require aggregate annual debt service charges on the notes by a board of public library trustees in an amount in excess of thirty percent (30%) of the average of the library s PLF distribution received for the two calendar years immediately preceding the year in which notes are issued and the property tax levy proceeds pledged for debt service charges. The Series 2017 Notes are to be paid by the Library solely from its distribution of the PLF, and the security pledge to the payment by the Library of debt charges on the Series 2017 Notes is secured by a pledge of the PLF collections received by the Library ( PLF Receipts ). The Series 2017 Notes receive a first pledge of lien on the PLF Receipts pursuant to Revised Code Section , subject to Chapter 9 of the Federal Bankruptcy Code and other laws affecting creditors rights. See THE PUBLIC LIBRARY FUND AND OTHER REVENUE SOURCES Public Library Fund for a discussion of the PLF and the allocation of funds therefrom. A table showing the Library s historic PLF distributions is set forth under THE PUBLIC LIBRARY FUND AND OTHER REVENUE SOURCES Public Library Fund in APPENDIX A. THE SERIES 2017 NOTES ARE NOT GENERAL OBLIGATIONS OF THE LIBRARY, THE COUNTY, THE STATE, OR ANY POLITICAL SUBDIVISION THEREOF AND ARE NOT SECURED BY THE FULL FAITH AND CREDIT OF THE LIBRARY OR BY ANY REVENUES OF THE LIBRARY OTHER THAN THE PUBLIC LIBRARY FUND RECEIPTS, AND THE SERIES 2017 NOTES ARE PAYABLE SOLELY FROM THE PUBLIC LIBRARY FUND RECEIPTS. THE SERIES 2017 NOTES SHALL BEAR A STATEMENT TO THAT EFFECT. Supplemental Trust Agreement In connection with the issuance of the Series 2017 Notes, the Library, the County Auditor ( County Auditor ) of Franklin County, Ohio ( County ) and The Huntington National Bank, Columbus, Ohio ( Trustee ) will enter into an agreement pursuant to Revised Code Section (the Second Supplemental Trust Agreement ) providing for the withholding and deposit of a portion of the PLF Receipts that would otherwise be due the Library into a special trust account for the payment of debt service charges on the Series 2017 Notes. The Second Supplemental Trust Agreement will be irrevocable as long as any of the Series 2017 Notes are outstanding. The Second Supplemental Trust Agreement is a supplement to the Trust Agreement entered into among the County, the Library, and the Trustee with 5

18 respect to the issuance by the Library, from time to time, of certain debt supported by the PLF Receipts pursuant to the terms thereof. Under the Second Supplemental Trust Agreement, the County Auditor will be obligated only to redirect the applicable portion of PLF Receipts to the Trustee on a monthly basis which would otherwise go to the Library. The existence of the Second Supplemental Trust Agreement does not make the Series 2017 Notes obligations, debts, or pledges of the faith, credit, or taxing power of the State or the County and the holders or owners of the Series 2017 Notes have no right to have taxes levied or appropriations made by the State or the County for the payment of debt service on the Series 2017 Notes. Library Bankruptcy The Library may file for bankruptcy under Chapter 9 of the Bankruptcy Code if it meets certain prerequisites under both federal and State law. Section 109(c) of the Bankruptcy Code sets forth the requirements for a State political subdivision to file for bankruptcy protection. In addition to requiring the library to be insolvent 1, the library must be specifically authorized, in its capacity as a library or by name, to be a debtor under such chapter by State law, or by a governmental officer or organization empowered by State law to authorize such entity to be a debtor under such chapter. 2 With regard to State law, Revised Code Section requires that a political subdivision which desires to file bankruptcy seek and obtain permission of the Tax Commissioner. The foregoing federal and State laws also permit an Ohio county to initiate Chapter 9 proceedings which, because a county collects certain revenues on behalf of a library (particularly ad valorem property taxes), may adversely affect the financial condition of such library. UNDERWRITING Stifel, Nicolaus & Company, Incorporated (the Underwriter ) has agreed, pursuant to the Note Purchase Agreement (the Purchase Agreement ) with the Library, dated November 8, 2017, to purchase all, but not less than all, of the Series 2017 Notes at a purchase price of $9,878, (the Purchase Price ), which is equal to the par amount of the Notes ($8,465,000.00), plus original issue premium ($1,458,474.60), less Underwriter s discount ($44,828.62). The Underwriter is purchasing the Series 2017 Notes as originally issued for purpose of the resale. The Underwriter reserves the right to join with dealers and other underwriters in offering the Series 2017 Notes to the public. The Underwriter may offer and sell the Series 2017 Notes to certain dealers (including dealer banks and dealers depositing the Series 2017 Notes into unit investment trusts, certain of which may be sponsored or managed by the Underwriter), and others at prices lower than the public offering prices noted on the cover hereof. The initial offering prices of the Series 2017 Notes may be changed, from time to time, by the Underwriter. The Underwriter has agreed to wire funds to the Note Registrar at closing for further distribution by the Note Registrar to pay certain costs of issuance of the Notes on behalf of the Library, including rating fees, printing and distribution costs, legal fees, Note Registrar and Escrow Trustee fees, and other miscellaneous expenses. An amount of $73, shall be deposited with the Note Registrar from the proceeds for this purpose and disbursed in accordance with instructions from Bond Counsel U.S.C. Section 101(32)(C) requires that in order to be insolvent a library must not be paying its debts as they come due. 2 See 11 U.S.C. Section 109(c)(2). 6

19 The obligation of the Underwriter to accept delivery of the Series 2017 Notes is subject to various conditions of the Purchase Agreement. The Underwriter is obligated to purchase all of the Series 2017 Notes if any of the Series 2017 Notes are purchased. The Underwriter and certain of its employees have previously made charitable contributions to the Library and The Columbus Metropolitan Library Foundation ( Foundation ). The Foundation provides financial support to Library programs. RATING As noted on the Cover, the Library has received a rating of the Series 2017 Notes from Moody s Investors Service, Inc. ( Moody s ), which has rated the Series 2017 Notes Aa2. No application for a rating has been made to any other rating agency. The rating reflects only the views of such rating agency. Any explanation of the significance of the rating may only be obtained from such rating agency at Moody s Investors Service, Inc., 7 World Trade Center, New York, New York 10007, telephone (212) ; website: The Library furnished to the rating agency certain information and materials, some of which may not have been included in this Official Statement, relating to the Series 2017 Notes and the Library. Generally, rating agencies base their ratings on such information and materials, as well as investigation, studies and assumptions by the rating agencies. Such ratings are not recommendations to buy, sell or hold the Series 2017 Notes. There can be no assurance that a rating, when assigned, will continue for any given period of time or that it will not be lowered or withdrawn entirely by a rating agency if, in the rating agency s judgment, circumstances so warrant. In addition, the Library currently expects to provide to the rating agency (but assumes no obligation to furnish to the Underwriter or the holders from time to time of the Series 2017 Notes) further information and materials that it or they may request. The Library does not, however, obligate itself hereby to furnish such information and materials, and may issue unrated bonds and notes from time to time. Failure by the Library to furnish such information and materials, or the issuance of unrated bonds or notes, may result in the suspension or withdrawal of a rating agency s rating on the Series 2017 Notes. Any lowering, suspension or withdrawal of such ratings may have an adverse effect on the marketability or market price of the Series 2017 Notes. LITIGATION To the knowledge of the appropriate officials of the Library, no litigation or administrative action or proceeding is pending or threatened restraining or enjoining, or seeking to restrain or enjoin, the issuance and delivery of the Series 2017 Notes, or the allocation of the Library s PLF Receipts to pay the debt service on the Series 2017 Notes, or contesting or questioning the proceedings and authority under which the Series 2017 Notes are to be authorized and are to be issued, sold, executed or delivered, or the validity of the Series 2017 Notes. A no-litigation certificate to such effect will be delivered to the Underwriter at the time of original delivery of the Series 2017 Notes to such Underwriter. The Library is not a party to any legal proceedings seeking damages or injunctive relief. 7

20 LEGAL MATTERS Legal matters incident to the issuance of the Series 2017 Notes and with regard to the excludability of the interest on the Notes from gross income for federal income tax purposes (see TAX MATTERS herein) are subject to the approving opinion of Bricker & Eckler LLP, Bond Counsel to the Library. A signed copy of that opinion will be delivered to the Underwriter at the time of original delivery. Assuming no change in applicable law prior to the date of delivery of such opinion, the opinion will be substantially in the form attached hereto as APPENDIX C. The opinion will speak only as of its date, and subsequent distribution of it by recirculation of the Official Statement or otherwise shall create no implication that Bond Counsel has reviewed or expresses any opinion concerning any of the matters referred to in the opinion subsequent to the date thereof. While Bond Counsel has participated in the preparation of portions of this Official Statement, it has not been engaged to confirm or verify, and expresses and will express no opinion as to the accuracy, completeness or fairness of any of the statements in this Official Statement, including its appendices (other than APPENDIX C), or in any other reports, financial information, offering or disclosure documents or other information pertaining to the Library or the Series 2017 Notes that may be prepared or made available by the Library or others to the holders of the Series 2017 Notes or others. General TAX MATTERS In the opinion of Bricker & Eckler LLP, Bond Counsel, under existing law, interest on the Series 2017 Notes is excluded from gross income for federal income tax purposes under Section 103(a) of the Code and is not treated as an item of tax preference under Section 57 of the Code for purposes of the alternative minimum tax imposed on individuals and corporations; it should be noted, however, that for the purpose of computing the alternative minimum tax imposed on corporations (as defined for federal income tax purposes), such interest is taken into account in determining adjusted current earnings. Further, the Series 2017 Notes are not private activity bonds as defined in Section 141(a) of the Code. Interest on the Series 2017 Notes, the transfer thereof, and any profit made on their sale, exchange or other disposition, are exempt from the Ohio personal income tax, the Ohio commercial activity tax, the net income base of the Ohio corporate franchise tax, and municipal, school district, and joint economic development district income taxes in Ohio. The Library has designated the Series 2017 Notes as qualified tax exempt obligations as defined in Section 265(b)(3) of the Code. The opinion on tax matters will be based on and will assume the accuracy of certain representations and certifications made by the Library and others, and the compliance with certain covenants of the Library, to be contained in the transcript of proceedings and which are intended to evidence and assure the foregoing, including that the Series 2017 Notes are and will remain obligations the interest on which is excluded from gross income for federal income tax purposes. Bond Counsel has not and will not independently verify the accuracy of such certifications and representations. The Code prescribes a number of qualifications and conditions for the interest on state and local government obligations to be and remain excluded from gross income for federal income tax purposes some of which require future or continued compliance after issuance of the obligations in order for the interest to be and continue to be so excluded from the date of issuance. Noncompliance with these 8

21 requirements could cause the interest on the Series 2017 Notes to be included in gross income for federal income tax purposes and thus to be subject to regular federal income tax retroactively to the date of their issuance. The Library has covenanted to take such actions that may be required of it for the interest on the Series 2017 Notes to be and remain excluded from gross income for federal income tax purposes, and not to take any actions which would adversely affect that exclusion. Under the Code, interest on the Series 2017 Notes may be subject to a branch profits tax imposed on certain foreign corporations doing business in the United States of America, and a tax imposed on excess net passive income of certain S corporations. Under the Code, the exclusion of interest from gross income for federal income tax purposes can have certain adverse federal income tax consequences on items of income or deductions for certain taxpayers, including among them financial institutions, certain insurance companies, recipients of Social Security and Railroad Retirement benefits, and those that are deemed to incur or continue indebtedness to acquire or carry tax-exempt obligations and individuals otherwise eligible for the earned income tax credit. The applicability and extent of these or other tax consequences will depend upon the particular tax status or other items of income and expenses of the holders of the Series 2017 Notes. Bond Counsel will express no opinion and make no representation regarding such consequences. Original Issue Discount Certain of the Series 2017 Notes may be sold to the public at a price of less than 100% of their face amount (the Discount Notes ). The following information, which has not been included in the opinion of Bond Counsel, may be helpful to prospective purchasers of the Discount Notes. Under present federal income tax law, original issue discount (i.e., the difference between the issue price, as hereinafter defined, of a Discount Note and the stated redemption price at maturity of such Discount Note), is treated as accruing ( accreted ) over the term of such Discount Note. The issue price is the price at which a substantial amount of the Discount Notes are sold to the public (excluding bond house, brokers or similar persons acting in the capacity of underwriters or wholesalers). In general, the amount of original issue discount which is to be accreted in each accretion period will equal (i) the issue price of that Discount Note, increased by the amount of original issue discount which has been accreted in all prior accretion periods, multiplied by (ii) the initial offering yield of that Discount Note reflected on the inside cover page of this Official Statement (determined on the basis of compounding at the close of each accretion period and properly adjusted for the length of the accretion period), minus, with respect to the Series 2017 Notes, interest actually paid during such accretion period. For these purposes, accretion period means a six-month period (or shorter period from the date the Discount Note was issued) which ends on a day in the calendar year corresponding to the maturity date of that Discount Note or the date six months before such maturity date. The amount of original issue discount so accreted in a particular accretion period will be considered to accrete ratably on each day of the accretion period. Such accreted amount is used for purposes of determining the adjusted basis for federal income tax purposes of the holder of such Discount Note but is not included in such holder s gross income for federal income tax purposes. Consequently, a purchaser who buys a Discount Note in the initial offering at the issue price and holds such Discount Note to its maturity would not realize any gain or loss for federal income tax purposes upon payment of the stated redemption price of that Discount Note at maturity. 9

22 Amortizable Note Premium Certain of the Series 2017 Notes may be sold at issue prices greater than the principal amount payable at maturity or earlier call date (the Premium Notes ). The following information, which has not been included in the opinion of Bond Counsel, may be helpful to prospective purchasers of the Premium Notes. Premium Notes will be considered to be issuable with amortizable note premium (the Note Premium ). A taxpayer who acquires a Premium Note in the initial public offering will be required to adjust his or her basis in the Premium Note downward as a result of the amortization of the Note Premium, pursuant to Section 1016(a)(5) of the Code. The amount of amortizable Note Premium will be computed on the basis of the taxpayer s yield to maturity with compounding at the end of each accrual period. Rules for determining (i) the amount of amortizable Note Premium and (ii) the amount amortizable in a particular year are set forth at Section 171(b) of the Code. No income tax deduction for the amount of amortizable Note Premium will be allowed to a holder pursuant in Section 171(a)(2) of the Code. The amortization of Note Premium may be taken into account as a reduction in the amount of tax-exempt income for purposes of determining other tax consequences of owning the Premium Notes. A purchaser of a Premium Note at its issue price in the initial public offering who holds that Premium Note to maturity will realize no gain or loss upon the retirement of such Premium Note. PROSPECTIVE PURCHASERS OF THE DISCOUNT OR PREMIUM NOTES SHOULD CONSULT THEIR OWN TAX ADVISORS AS TO THE TAX CONSEQUENCES OF THE PURCHASE, SALE, TRANSFER, REDEMPTION, PAYMENT, OR OTHER DISPOSITION OF THE DISCOUNT OR PREMIUM NOTES, INCLUDING, WITHOUT LIMITATION, MODIFICATIONS TO THE METHOD FOR ACCRETING ORIGINAL ISSUE DISCOUNT OR AMORTIZING PREMIUM FOR CERTAIN SUBSEQUENT PURCHASERS, AND INCLUDING THE EFFECT OF ANY APPLICABLE STATE OR LOCAL INCOME TAX LAWS. VERIFICATION OF ARITHMETICAL AND MATHEMATICAL COMPUTATIONS Upon delivery of the Notes, Causey Demgen & Moore P.C., certified public accountants (the Verification Agent ) will deliver reports on the arithmetical accuracy of certain computations contained in schedules provided to them by the Underwriter on behalf of the Library relating to (a) computation of forecasted receipts of principal and interest on the securities held in the Escrow Fund to refund the Refunded Notes and (b) computation of the yields on the Notes and the securities held in the Escrow Fund to refund the Refunded Notes. Such computations will be based solely on assumptions and information supplied by the Underwriter on behalf of the Library, and the Verification Agent has restricted its procedures to examining the arithmetical accuracy of certain computations and has not made any study or evaluation of the assumptions and information on which such computations are based. Accordingly, the Verification Agent has not expressed an opinion on the data used, the reasonableness of the assumptions, or the ability to achieve the forecasted outcome. 10

23 BOOK-ENTRY ONLY SYSTEM The information in this section concerning DTC and DTC s book-entry only system has been obtained from DTC and the Library takes no responsibility for the completeness or accuracy thereof. The Library cannot and does not give any assurances that DTC, Direct Participants or Indirect Participants will distribute to the Beneficial Owners (each as hereinafter defined) (a) payments of interest, principal, or premium, if any, with respect to the Series 2017 Notes, (b) certificates representing ownership interest in or other confirmation or ownership interest in the Series 2017 Notes, or (c) redemption or other notices sent to DTC or Cede & Co., its partnership nominee, as the registered owner of the Series 2017 Notes, or that they will so do on a timely basis or that DTC, Direct Participants or Indirect Participants will act in the manner described in this Official Statement. The current Rules applicable to DTC are on file with the Securities and Exchange Commission and the current Procedures of DTC to be followed in dealing with DTC Participants are on file with DTC. The Depository Trust Company ( DTC ), New York, New York, will act as securities depository for the Series 2017 Notes. The Series 2017 Notes will be issued as fully-registered Notes registered in the name of Cede & Co. (DTC s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Note certificate will be issued for each maturity of the Series 2017 Notes, each in the aggregate principal amount of such maturity, and will be deposited with DTC. DTC, the world s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a banking organization within the meaning of the New York Banking Law, a member of the Federal Reserve System, a clearing corporation within the meaning of the New York Uniform Commercial Code, and a clearing agency registered pursuant to the provisions of Section 17A of the Securities Exchange Act of DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-u.s. equity issues, corporate and municipal debt issues, and money market instruments from over 100 countries that DTC s participants ( Direct Participants ) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-u.s. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ( DTCC ). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-u.s. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ( Indirect Participants ). DTC has a S&P Global Ratings, a division of S&P Global Inc. rating of AA+. The DTC rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at Purchases of Notes under the DTC system must be made by or through Direct Participants, which will receive a credit for the Series 2017 Notes on DTC s records. The ownership interest of each actual purchaser of each Note ( Beneficial Owner ) is in turn to be recorded on the Direct and Indirect Participants records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the 11

24 Series 2017 Notes are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in the Series 2017 Notes, except in the event that use of the book-entry system for the Series 2017 Notes is discontinued. To facilitate subsequent transfers, all Notes deposited by Direct Participants with DTC are registered in the name of DTC s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Notes with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not affect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Series 2017 Notes; DTC s records reflect only the identity of the Direct Participants to whose accounts such Notes are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Notes may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Series 2017 Notes, such as redemptions, tenders, defaults, and proposed amendments to the Series 2017 Notes. For example, Beneficial Owners of Notes may wish to ascertain that the nominee holding the Series 2017 Notes for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the Note Registrar and request that copies of the notices be provided directly to them. Redemption notices shall be sent to DTC. If less than all of the Series 2017 Notes within an issue are being redeemed, DTC s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Notes unless authorized by a Direct Participant in accordance with DTC s MMI procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the Library as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co. s consenting or voting rights to those Direct Participants to whose accounts the Series 2017 Notes are credited on the record date (identified in a listing attached to the Omnibus Proxy). All payments on the Series 2017 Notes will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC s practice is to credit Direct Participants accounts, upon DTC s receipt of funds and corresponding detail information from the Library or the Note Registrar, on payable date in accordance with their respective holdings shown on DTC s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in street name, and will be the responsibility of such Participant and not of DTC, the Note Registrar, or the Library, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment on the Notes to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Library or the Note Registrar, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. 12

25 DTC may discontinue providing its services as a depository with respect to the Notes at any time by giving reasonable notice to the Library or the Note Registrar. Under such circumstances, in the event that a successor depository is not obtained, Note certificates are required to be printed (or otherwise produced) and delivered. The Library may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Note certificates will be printed (or otherwise produced) and delivered to DTC. (See also BOOK-ENTRY ONLY SYSTEM Revision of Book-Entry Only System Replacement Notes ) The information in this section concerning DTC and DTC s book-entry system has been obtained from sources that the Library believes to be reliable, but the Library takes no responsibility for the accuracy thereof. Revision of Book-Entry Only System - Replacement Notes The Note Resolution provides for issuance of fully registered Notes (the Replacement Notes ) directly to owners other than DTC or its nominee only if DTC determines not to continue to act as security depository of the Series 2017 Notes. In such event, the Library may in its discretion establish a securities depository/book entry relationship with another qualified securities depository. If the Library does not or is unable to do so, and after appropriate notice to DTC, the Library s Note Registrar will authenticate and deliver fully registered Replacement Notes, in the denominations of $5,000 or any multiple thereof, to or at the direction of and, if the event is not the result of Library action or inaction, at the expense (including printing costs) of, any persons requesting such issuance. Replacement Notes may be transferred, registered and assigned only in the registration books of the Library s Note Registrar. TRANSCRIPT AND CLOSING DOCUMENTS A complete transcript of proceedings for the Series 2017 Notes, including an appropriate no-litigation certificate (described above under Litigation ), will be delivered by the Library when the Series 2017 Notes are delivered by the Library to the Underwriter. The Library will at that time also provide to the Underwriter a certificate of the Fiscal Officer of the Library, in the form attached hereto as APPENDIX D, addressed to the Underwriter relating to the accuracy and completeness of this Official Statement. 13

26 CONTINUING DISCLOSURE The Library has agreed for the benefit of the holders and beneficial owners of the Series 2017 Notes to provide annual financial and operating information in its Annual Report, not later than July 1 of each year, and to provide notices of certain significant events, as listed in the Disclosure Certificate defined below. Concurrently with the delivery of the Series 2017 Notes, the Library will deliver a certificate of the Fiscal Officer of the Library (the Disclosure Certificate ), in the form attached hereto as APPENDIX E, describing the nature of the information to be provided, the persons and entities to whom such information will be provided and the times at which such information will be provided. The Library s failure to comply with any undertaking contained in the Disclosure Certificate will not constitute an event of default under the Series 2017 Notes. The Disclosure Certificate is being signed by the Library to assist the Underwriter in complying with Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission. Specifically, the Library agrees to provide the Annual Report to the Municipal Securities Rulemaking Board (the MSRB ) in an electronic format, if required, and to provide notice of the enumerated events to the MSRB in an electronic format, if required. The Library has a continuing disclosure undertaking in connection with the Outstanding Notes (the Undertaking ) that has been in effect for all of the previous five years. The Library has elected to comply with the Undertaking by designating its Comprehensive Annual Financial Report ( CAFR ) as its Annual Report, as permitted. The Library filed its CAFR timely with the MSRB in each of the last five years, with the exception of In 2014, the CAFR became available after the Undertaking s July 1 due date and was filed with the MSRB on July 31. The Library did not provide notice to the MSRB of the thirty-day delay in filing. [Balance of Page Intentionally Left Blank] 14

27 CONCLUDING STATEMENT To the extent that any statements made in this Official Statement involve matters of opinion or estimates, whether or not expressly stated to be such, they are made as such and not as representations of fact or certainty, and no representation is made that any of such statements will be realized. Information herein has been derived by the Library from official and other sources and is believed by the Library to be reliable, but information other than that obtained from official records of the Library has not been independently confirmed or verified by the Library and its accuracy is not guaranteed. Neither this Official Statement nor any statement which may have been made orally or in writing is to be construed as or as part of a contract with the original purchasers or holders of the Series 2017 Notes. This Official Statement has been duly prepared and delivered by the Library, and executed for and on behalf of the Library by the Board President and Chief Financial Officer/Fiscal Officer. COLUMBUS METROPOLITAN LIBRARY FRANKLIN COUNTY, OHIO By: /s/ Tim Frommeyer Board President By: /s/ Paula Miller Chief Financial Officer/Fiscal Officer 15

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29 APPENDIX A THE COLUMBUS METROPOLITAN LIBRARY General Information The Library, founded in 1872, provides services to customers in and around Franklin County, Ohio (the County ). The County, located in central Ohio, includes the City of Columbus (the City ), which is the state capital and the county seat. According to the U.S. Bureau of the Census, the estimated population figures for the County and City in 2010 were 1,163,414 and 787,033, respectively. The Library is a county library district established in accordance with Section of the Ohio Revised Code. The Library is not a part of, nor under the control of, the County or the City. [Balance of Page Intentionally Left Blank] A-1

30 The Library s curent service district and locations are depicted below: Library Programs and Customers The Library opened its doors in 1872 in City Hall and its administrative offices are now located at 96 South Grant Avenue in the Main Library in the City s downtown. The Library has consistently been one of the A-2

31 top-ranked large urban libraries and has a long list of awards to show for it. The Library is the only public library in the United States to earn these key designations: Hennen s Number 1 ranking among all U.S. Public Libraries in 1999, 2006 and 2008 National Library of the Year in 2010 by Library Journal Rated a 5-Star Library on the list of Library Journal s America s Star Libraries and held the same rating all four years the rating system existed 2011 National Medal for Museum and Library Service Additionally, the Library was selected a 2012 Central Ohio Workforce Corporation Champion for commitment to developing a strong workforce in Central Ohio. In 2016 The Columbus Foundation named the Library one of 5 Nonprofits to Watch. Most recently, in 2017 the Library received the American Library Association s John Cotton Dana Library Public Relations Award. The Library s consistent success is in part due to its tradition of award-winning leadership. Current Chief Executive Officer, Patrick Losinski, received the Charlie Robinson Award for Innovation in 2010 by the American Library Association. Mr. Losinski was also named the 2012 Champion for Children by the United Way of Central Ohio, the 2015 Columbus CEO Magazine s CEO of the Year for large nonprofit and the 2017 Regional Leadership Award from the Mid-Ohio Regional Planning Commission. Alison Circle, current Chief Customer Experience Officer was selected by Library Journal as a 2012 Mover & Shaker and, in 2017, was selected as a Customer Experience Impact Award winner by the Customer Experience Professional Association. The Library system is comprised of 23 different locations conveniently located in neighborhoods throughout the county, serving over 750,000 residents with approximately 16 million items in circulation. A strong strategic plan supports the Library s purpose to inspire reading, share resources and connect people. This allows the Library to respond to areas of urgent need: kids unprepared for kindergarten, state third-grade reading support and high school retention rates. The Library also provides support and training for adults in need of employment resources. Libraries understand the need to think differently and collaboratively in a time of diminishing dollars. By investing in advances in technology and strategic partnerships, the Library has positioned itself as an organization ready to meet the needs and demands of its customers and communities. Signature Programs and Strategic Partnerships Ready for Kindergarten. This is the foundation of the Library s Children s programing. It is designed to help parents and caregivers of infants and children up to age 5 prepare their kids for kindergarten, since kindergarten readiness is a critical factor for a child s success in school. The Library provides Ready for Kindergarten trainings that focus on four skills (vocabulary, beginning letter sounds, letter recognition, rhyming) to help parents and caregivers become their child s first teacher. This signature program is comprised of many, professional leading, components: Ready to Read Corps: specially trained staff providing in depth, one-on-one training in at-risk neighborhoods Ready for Kindergarten Storytimes: teaching parents the skills to use at home Ready for Kindergarten designated areas: recreating public school kindergartens so families can practice being in school before the first day of school including riding the bus Ready for Kindergarten Classes: hands-on readiness for 3, 4, and 5-year olds and their parents Kindergarten Boot Camp: 8-session summer boot camps led by licensed Kindergarten teachers providing school experience for incoming kindergartners Data: rigorous data analysis with The Ohio State University to monitor our impact A-3

32 Third Grade Reading. The state of Ohio requires that all third-grade students pass the third grade reading assessment in order to be promoted to fourth-grade. To support students and families the Library provides a robust list of programs: Reading Buddies: afterschool reading and comprehension practice. In 2016 we held 26,000 sessions throughout our Library system. Book delivery: weekly delivery of library books to at-risk elementary schools Summer Lunch and After School Snack: providing food so hungry children can learn Kids Cards: no fines or fees so that children always have access to books Summer Reading Club. The Library has one of the largest Summer Reading Clubs in the country with nearly 60,000 participants in Significantly, the program focuses on the well documented summer slide children losing the reading skills that they developed throughout the school year. Most classrooms spend the first months of each school year helping students regain those skills. Summer Reading Club is designed to minimize that loss. Homework Help Centers. Thanks to donor generosity, students receive help in all 23 locations from staff and volunteers and have free access to computers, printers and school supplies. Students visited the Library s Homework Help Centers 95,000 times during the last school year. The Library has offered this service since Technology. Two million computer and wireless sessions annually in the Library s locations connect customers to the digital world. Free Wi-Fi means anyone can bring their laptops and connect. The Library was one of the first libraries to offer free computer access. Strategic Library Partnerships. In 2012, the Library joined the Central Library Consortium, a partnership resulting in 14 library systems serving 1.4 million residents across six Ohio counties with nearly 1.2 million unique titles, significantly expanding the number of titles the Library could offer alone. In 2017 the Library will join SearchOhio, another consortium, that provides customers access to titles throughout the state, including academic libraries. With 16 other libraries, the Library is a part of the Digital Downloads Collaboration, collectively purchasing ebooks for the public. A-4

33 2010: The following table displays the number of recorded customers of the Library, categorized by age, since Board of Library Trustees Columbus Metropolitan Library Customers 0-11 Years Total 18+ Years Years Customers ,949 76, , , ,017 85, , , ,994 95, , , ,632 75, , , ,636 82, , ,501 Source: Columbus Metropolitan Library. The Library replaced the Integrated Library System in 2013 and began to track the age of cardholders in different age brackets. The legislative power of the Library is vested in the Board of Trustees (the Board ), which, as a body corporate and politic, is capable of suing and being sued, contracting, acquiring, possessing and disposing of real and personal property. The Board consists of seven members appointed for seven year terms. Board members are appointed by judges of the Franklin County Common Pleas Court and the Franklin County Board of Commissioners. The Board meets regularly at a minimum of ten times per year. At the first meeting of each year, the Board elects a president and a vice president from its membership, each to serve a one-year term. The Library employs a Chief Executive Officer, Chief Financial Officer/Fiscal Officer, Chief Customer Experience Officer, Chief Administrative Officer and Chief Information Officer as executive staff. 1 In 2016, the Library purged inactive accounts. 2 Year to Date as of October 9, A-5

34 Official Library Officials Columbus Metropolitan Library Office Expiration of Current Term Years of Service Tim Frommeyer President 12/31/ (Since 9/2014) Mike Duffy Vice President 12/31/ (Since 11/2015) Katie Chatas Secretary 12/31/ (Since 1/2016) Erika Clark Jones Member 12/31/ (Since 1/2005) Cindy Hilsheimer Member 12/31/ (Since 1/2000) Kevin Reeves Member 12/31/2023 <1 (Since 1/2017) Roger Sugarman Member 12/31/ (Since 1/2007) Patrick Losinski Chief Executive Officer Contract 15 Paula Miller Chief Financial Officer/Fiscal Officer N/A 4 Stewart Smith Deputy Fiscal Officer N/A 1 Source: Columbus Metropolitan Library Library Employees and Pension Obligations The Library currently has 812 employees. The Library does not engage in collective bargaining with any of its employees. All employees are required to participate in the Ohio Public Employees Retirement System ( OPERS ). OPERS administers three separate pension plans, as described below: 1. Traditional Pension Plan (TP) a cost-sharing, multiple employer defined benefit pension plan. 2. The Member-Directed Plan (MD) a defined contribution plan in which the member invests both member and employer contributions (employer contributions vest over five years at 20% per year). Under the MD Plan, members accumulate retirement assets equal to the value of member (vested) employer contributions plus any investment earnings. 3. The Combined Plan (CO) a cost-sharing, multiple-employer defined benefit pension plan. Under the CO Plan, employer contributions are invested by OPERS to provide a formula retirement benefit similar in nature to the TP Plan benefit. Member contributions, the investment of which is self-directed by the members, accumulate retirement assets in a manner similar to the MD Plan. OPERS provides retirement, disability, survivor and death benefits and annual cost of living adjustments to members of the TP Plan and the CO Plan. Members of the MD Plan do not qualify for ancillary benefits. Authority to establish and amend benefits is provided in Chapter 145 of the Ohio Revised Code. The Ohio Revised Code provides statutory authority for member and employer contributions. For 2016, member (10.00%) and employer (14.00%) contribution rates were consistent across all three plans. Total required employer contributions for all three plans are equal to 100% of employer charges and should be extracted from the employer s records. The Library s contributions to OPERS for the years ending December 31, 2016, 2015 and 2014, were $3,535,762, $3,433,876, and $3,378,920, respectively, which were equal to the required contributions for each year. A-6

35 Library Facilities The Library presently operates the following branch facilities: Name of Building 2016 Collection 2016 Circulation No. of Librarians & Staff Year Building Completed Year of Additions/ Renovations Canal Winchester 7,707 83, n/a Driving Park 12, , n/a Dublin 119,062 1,665, Franklinton 12, , n/a Gahanna 101,394 1,220, Hilliard 131,473 1,764, n/a Hilltop 63, , n/a Karl Road 72, , Linden 22, , n/a Livingston 26, , n/a Main Library 241,767 3,299, Marion Franklin 3,982 30, n/a Martin Luther King 13, , n/a New Albany 81,423 1,005, n/a Northern Lights 37, , Northside 2, , n/a Parsons 20, , n/a Reynoldsburg 81,747 1,007, Shepard 17, , n/a South High 28, , n/a Southeast 68, , n/a Whetstone 118,885 1,546, Whitehall 35, , n/a Total 1,321,289 16,099, n/a n/a Source: Columbus Metropolitan Library, data as October 6, A-7

36 Library Facilities upon Completion of Project The Series 2012 Notes, including the Refunded Notes, financed the costs of the following branch facilities: Name of Building Square Footage Completion Existing Proposed Date Completed Facilities Driving Park 6,000 15,000 7/12/2014 Main Library 1 255, ,400 6/25/2016 Northern Lights 1 11,831 26,100 9/24/2016 Northside 7,728 24,900 6/22/2017 Parsons 7,599 19,000 6/4/2016 Shepard 6,005 10,000 10/13/2016 Whitehall 7,466 20,000 4/11/2015 Expected In-Progress Completion Dublin 20,147 41, Martin Luther King 8,993 18, Hilliard 20,005 59, Total 331, ,400 Source: Columbus Metropolitan Library 1 Renovation. A-8

37 ECONOMY AND EMPLOYMENT Labor Force Statistics The County and the MSA information presented in this section is included for informational purposes only. The following statistics are not seasonally adjusted. Area Unemployment Rates (annual percentages) Labor Force (in thousands) Year Franklin County Columbus MSA State of Ohio United States Year Franklin County * Source: Ohio Department of Job and Family Services, Bureau of Labor Market Information [Balance of Page Intentionally Left Blank] 1 Preliminary average through September A-9

38 Largest Employers The following table lists the 50 largest employers in the City as of July Largest Employers Columbus, Ohio Rank Firm Number of Employees Industry 1 The Ohio State University 30,804 Education 2 State of Ohio 24,067 Government 3 Kroger Co. 22,821 Retail grocery 4 Ohio Health Corp. 21,117 Healthcare 5 JPMorgan Chase & Co. 18,600 Banking & financial services 6 Nationwide Mutual Insurance Company 14,100 Insurance & financial services 7 Nationwide Children's Hospital 10,032 Healthcare 8 Mount Carmel Health System 8,852 Healthcare 9 City of Columbus 8,815 Government 10 Columbus City School District 8,004 Education 11 L Brands Inc. 7,800 Retail clothing 12 Honda North America, Inc. 7,700 Auto manufacturing 13 Franklin County 7,040 County Government 14 Huntington Bancshares Inc. 5,848 Banking & financial services 15 Cardinal Health Inc. 5,197 Medical products & services 16 American Electric Power Company Inc. 4,015 Electric power utility 17 U.S. Postal Service 3,598 Federal mail service 18 Giant Eagle Inc. 3,540 Retail grocery 19 Alliance Data Systems Corp. 3,057 Marketing/credit card transaction services 20 Abercrombie & Fitch Company 2,895 Retail clothing 21 South-Western City School District 2,553 Education 22 YMCA of Central Ohio 2,518 Youth development/social outreach 23 DLA Land and Maritime 2,500 Defense systems manufacturer 24 Verizon 2,406 Telecommunications 25 Discover Financial Services LLC 2,394 Financial services 26 Gap Inc. 2,200 Retail clothing 27 DHL Supply Chain 2,190 Contract logistics provider 28 Amazon.com, Inc. 2,120 Online retailer/cloud computing 29 Abbott Laboratories/Abbott Nutrition 2,055 Nutrition research and products 30 Fairfield Medical Center 2,032 Healthcare 31 Battelle Memorial Institute 1,984 Technology & research development 32 Licking Memorial Health Systems 1,953 Healthcare 33 United Parcel Service 1,949 Package delivery & supply chain management 34 Donatos Pizzeria LLC 1,932 Restaurant 35 Safelite Group Inc. 1,920 Vehicle glass repair 36 XPO Logistics, Inc. 1,907 Transportation and logistics services 37 Express Scripts Holding Co. 1,891 Pharmacy benefits management 38 Dublin City School District 1,868 Education 39 Wendy's Co. 1,800 Restaurant 40 Time Warner Cable Inc. 1,779 Telecommunications 41 TS Tech Americas Inc. 1,772 Auto seat manufacturing 42 Vertiy Co. 1,720 Networking & information systems 43 Worthington Industries Inc. 1,680 Steel manufacturing 44 Worthington City School District 1,669 Education 45 Ascena Retail Group, Inc. 1,615 Retail clothing 45 Big Lots Inc. 1,615 Discount retail 47 Roosters Inc. 1,501 Restaurant 48 PNC Financial Services Group Inc. 1,500 Banking & financial services 48 Teleperformance USA 1,500 Call center, customer service, tech support 50 Stanley Electric Company 1,496 Auto lighting and electrical component manufacturing Source: Columbus Business First, July 2017 A-10

39 Financial Reports and Examination of Accounts FINANCES OF THE LIBRARY The Library s fiscal year corresponds with the calendar year, beginning January 1 and ending December 31. The Board maintains its accounts, appropriations and other fiscal records on the basis of generally accepted accounting principles ( GAAP ). The State Auditor is charged by law with the responsibility for auditing the financial statements of each taxing subdivision and most public agencies and institutions. A financial report for each fiscal year is required to be filed with the State Auditor pursuant to Revised Code Section Such reports are required to be submitted to the State Auditor at the close of each fiscal year. The most recent audit of the Library s financial statements by the State Auditor was completed through the fiscal year ending December 31, 2016 and was reviewed by the Board s administrative staff. The State Auditor did not make any citations, require any adjustments, or make any findings for recovery. No bring-down procedures have been undertaken by the State Auditor since the date of such financial statements. The audited Basic Financial Statements for the Year Ended December 31, 2016 are attached hereto as APPENDIX B. Governmental Accounting Standards Board pronouncements and Financial Accounting Standards Board pronouncements are the principal sources used to determine the accounting principles employed under GAAP. These publications, among other things, provide for a modified accrual basis of accounting for governmental funds and for a full accrual basis of accounting for proprietary funds and for each major and aggregated nonmajor fiduciary funds. The publications also further provide for the preparation of balance sheets for each major and non-major fund, and statements of revenues and expenditures, and changes in fund balances (major and aggregated non-major governmental funds) or statements of revenues, expenses and changes in retained earnings/equity (major and aggregated non-major proprietary funds) and statement of cash flows. The principles further require preparation of a statement of net assets and a statement of activities for the entity s business type and government type activities on the full accrual basis of accounting, and management s discussion and analysis of major events and transactions during the year. In 2016, the Government Finance Officers Association presented the Library with the Comprehensive Annual Financial Report (CAFR) Award for the 30th consecutive year. The Financial Services Department was recognized in 2017 by the State Auditor for placing a high priority on financial accountability with the Auditor of the State Award with Distinction. General Fund Operations The General Fund is the main operating fund of the Library. It is the fund from which most of the Library s expenditures are paid and into which most of the Library s revenues are deposited. The Library derives most of its revenues from property taxes as discussed under THE PUBLIC LIBRARY FUND AND OTHER REVENUE SOURCES Ad Valorem Taxes and Assess Valuation. Revenues from the PLF are also paid into the General Fund. A-11

40 Revenues and Expenditures The following table summarizes revenues and expenditures from all governmental funds, including the General Fund, for the fiscal years indicated: Revenues Revenues and Expenditures All Governmental Funds 1 (GAAP Basis) Property Taxes $46,748,089 $43,535,330 $44,098,394 46,577,352 Intergovernmental 26,215,156 26,020,216 27,737,200 25,974,986 Patron Fines and Fees 1,189, , , ,556 Earnings on Investments 382, , ,225 1,221,898 Charges for Services 1,415,195 1,400,049 1,394,132 1,489,736 Contributions, Gifts and Donations 1,323,669 4,294,082 6,125,786 10,252,208 Miscellaneous Receipts 393, , , ,951 Total Revenue $77,668,054 $77,429,750 $81,246,275 $86,308,687 Expenditures Current: Public Service $33,300,994 $35,420,238 $36,000,505 $38,666,564 Administrative and Support 23,799,477 22,806,297 24,241,587 25,663,648 Capital Outlay 8,933,331 10,097,870 25,464,650 45,611,448 Debt Service Principal 2,620,000 2,620,000 2,635,000 2,755,000 Interest 3,197,256 3,197,924 3,183,776 3,023,210 Issuance Costs 74,600 Total Expenditures $71,851,058 $74,142,329 $91,525,518 $115,794,470 Excess (deficiency of revenues over (under) expenditures $5,816,996 $3,287,421 ($10,279,243) ($29,485,783) Source: 2016 Comprehensive Annual Financial Report, Columbus Metropolitan Library Budgeting, Tax Levy and Appropriations Procedures The Revised Code contains detailed provisions regarding library budgeting, tax levy and appropriation procedures. These procedures involve review by County officials at several steps. Library budgeting for a fiscal year formally begins with the preparation of a tax budget. After a public hearing in July proceeding the fiscal year to which the budget pertains, the budget is adopted by the Board. Among other items, the tax budget must show the amount of PLF revenue requested by the Library, including the amount of PLF revenue needed to pay debt service on the Series 2017 Notes, the estimated receipts from sources other than ad valorem property taxes, and an estimate of amounts to be collected from tax levies approved by the voters. The tax budget then is presented for review by the County Budget Commission, comprised of the County 1 Governmental Funds include the following funds: General, Capital Projects, Permanent, Restricted and Land Development. A-12

41 Auditor, County Treasurer and County Prosecuting Attorney. The Budget Commission holds a public hearing, reviews the budget along with the budgets of the other political subdivisions in the County, and issues, by September 1st, the Certificate of Estimated Resources which is the basis for Library appropriations and expenditures for the coming fiscal year. Upon approval of the tax budget and issuance of the Certificate of Estimated Resources, the County Budget Commission certifies its actions to the Board together with the approved tax rates. Thereafter, and before October 1 of each year, the Board levies the approved taxes and certifies them to the proper County officials. The approved and certified tax rates are reflected in the tax bills sent to property owners during the collection year. Real property taxes are payable on a calendar year basis, generally in two installments with the first due usually in January and the second due in June or later. The Board is required to pass an appropriation measure on or about the first of January of each year, or if the Board desires to postpone the passage of the annual appropriation measure until an amended Certificate of Estimated Resources is received, based on actual balances, it may pass a temporary appropriation measure for meeting the Library s ordinary expenses to last no longer than March 31. Annual appropriations may not exceed the County Budget Commission s official estimates of resources. Appropriation measures must be certified by the County Auditor as not appropriating more moneys than sets forth in those latest official estimates. The County serves as tax collector for the Library. Investments and deposits of County funds are governed by Revised Code Chapter 135 (the Uniform Depository Act ). The County Treasurer is responsible for those investments and deposits. The County s most recent audited financials contain a recitation of the County s current investment practices and can be obtained at the Ohio Auditor of State website: Library Insurance The Library maintains comprehensive insurance coverage with private carriers for real property, building contents and vehicles in a maximum amount of $195,220,952 with a $10,000 deductible. In addition, the Library has an umbrella liability policy for $25,000,000 and a commercial excess liability policy of $25,000 both with a limit of $1,000,000 per occurrence. Ohio law provides immunity for political subdivisions such as the Library from liability in damages. The immunity covers injury, death, or loss to persons or property allegedly caused by an act or omission of such political subdivisions or their employees in connection with governmental and proprietary functions, as defined in the Ohio statutes. Included among such governmental functions are the design, construction, reconstruction, renovation, repair, maintenance, and operation of any school athletic facility, school auditorium, or gymnasium. The statutes have no effect on any liability imposed by federal law or other federal cause of action. Pursuant to Ohio law, there are, however, five areas in which a political subdivision may be held liable for such loss. These include the negligent operation of a motor vehicle by employees engaged within the scope of their employment and authority; negligent performance of proprietary functions; negligent failure to keep public roads in repair, and other negligent failure to remove obstructions from public roads; negligence of employees due to physical defects within or upon the grounds of buildings used in the performance of governmental functions, excluding jails, juvenile detention workhouses and other detention facilities; and liability specifically imposed by statute. Ohio law also imposes a two-year statute of limitations and puts limits on the damages which may be recovered from such political subdivisions. No punitive or exemplary damages can be recovered, and any insurance benefits are deducted from any award against a political subdivision. Although there is no limitation with respect to compensatory damages representing a person s economic loss, there is a $250,000 per person ceiling on the compensatory damage that represents a person s non-economic loss in cases other than wrongful death, in which case there is no maximum limitation. A-13

42 THE PUBLIC LIBRARY FUND AND OTHER REVENUE SOURCES General The main source of Library revenue is property taxes. Other revenue sources include PLF Receipts, fines, fees, investment earnings, contractual services, grants and gifts. The following table sets forth the respective percentage of General Fund receipts of the Library for the past five years. Public Library Fund Receipts % of General Fund Library Operating Revenue General Fund (Cash Basis) % of General Fund Other Revenue Receipts % of General Fund Total General Fund Revenue Property Tax Year Receipts $13,450, % $52,119, % $2,307, % $67,877, ,079, ,594, ,484, ,158, ,309, ,991, ,116, ,416, ,240, ,020, ,287, ,548, ,420, ,856, ,478, ,755,974 Source: Columbus Metropolitan Library and Franklin County Auditor Public Library Fund Effective 1986, the Ohio General Assembly created the Library and Local Government Support Fund (the LLGSF ) in Revised Code Chapter 4547 and repealed the local situs intangible tax which was previously used, since 1933, to fund public libraries. In 2008, the LLGSF was renamed the Public Library Fund. The PLF is a significant source of funding for the Library. Distribution of the PLF is pursuant to the statutory formula as set forth below. In the decades following the establishment of the PLF, funding levels have been tied to the preceding month s State income tax collections in varying percentages ranging from 6.3% in 1986 to 5.7% in 2007, with varying freeze levels and growth caps. In 2008, PLF funding was shifted to 2.22% of the preceding month s total State General Revenue Fund ( GRF ) balance. However, this percentage has also varied since 2008 due to economic conditions statewide and nationally as a result of the recession. In 2017, the percentage for PLF is 1.70% of GRF. In the State biennium budget, the percentage is 1.68% of GRF. 1 Includes State rollback payments and reimbursement payments relating to utility and personal property phase-outs. 2 Projected. A-14

43 PLF Distributions Calendar Year PLF Annual Total (millions) % Change from 2008 Base % Change from Prior Year 2008 $ % -17.8% Source: Ohio Library Council Despite the adjustments made to State library funding in recent years, the method for distributing funds to public libraries across Ohio s 88 counties has not been altered. PLF moneys are distributed to counties pursuant to a two-part formula which includes a guaranteed share and an excess share. The guaranteed share equals the product obtained by multiplying a county s total entitlement for the preceding year by an inflation factor based upon the growth in the Consumer Price Index for the 12-month period ending in May of the year preceding the distribution. If the sum of the guaranteed shares of all counties exceeds the money available in the PLF, all counties guarantee shares will be reduced by an equal percentage. The excess share is equal to the amount in the PLF minus the sum of all counties guaranteed shares. The excess share is distributed to the counties based upon equalization ratios, calculated using each county s share of the statewide population in relation to its portion of the preceding year s PLF. Each county s individual equalization ratio is multiplied by the total amount of excess funds available to compute that county s share of the excess. The equalization ratio is intended to provide counties that were historically underfunded by the intangibles tax a larger share of the excess (in relation to the county s guaranteed share) than counties above the average. The purpose behind the excess share formula is to equalize per capita library funding among the counties over time while guaranteeing inflationary growth and some real growth. The distribution of the moneys in the PLF is administered by the Tax Commissioner of the State (the Tax Commissioner ) and the individual county treasurers or fiscal officers. On or prior to July 20 of each year, the Tax Commissioner must certify to each county auditor or fiscal officer the amount estimated for the county s PLF for the following calendar year. The following December and June the Tax Commissioner must update the estimates and certify the revised estimates to each county auditor. By the tenth day of each month, the Auditor of State (the State Auditor ) must distribute the amount credited to the PLF from taxes collected during the preceding month. The amount that each county receives under the monthly distribution is equal to the county s estimated share of the annual fund based upon the most recent certified estimates for the calendar year. By December 20 of each year the Tax Commissioner must determine and certify to each county auditor the PLF balance for the year, the amount the county was entitled to receive as its guaranteed and excess shares under the distribution formula during the calendar year, the amount the county actually received as its guaranteed and excess shares, and the difference between the two. During the first six months of the next year, each county s distribution will be adjusted for any such overpayment or underpayment received in the preceding year. 1 Projected. A-15

44 The county treasurer or fiscal officer of each county must distribute all funds (no deduction may be made for county auditor or treasurer or fiscal officer fees) in the county PLF on the 15th day of each month to the boards of public library trustees. Allocation of the PLF is made in each county by the Budget Commission to each of the public libraries that has qualified under Revised Code Section for participation in the proceeds of such fund. To qualify to receive an allocation from the PLF under Section , a library must have been operating prior to January 1, 1968 and have extended the benefits of library service to all of the inhabitants of the county in which the library is located on equal terms and participated in the distribution of proceeds from the county public library fund prior to December 31, In setting the allocations for the year, the Budget Commission begins with the estimate certified to the county auditor or fiscal officer by the Tax Commissioner as to the total amount of revenue to be received in the county PLF during the fiscal year. The Budget Commission then allocates the amount available for distribution based on the needs of each library for the construction of new library buildings, parts of buildings, improvements, operation, maintenance, or other expenses. In determining the need of each library board of trustees, and in calculating the amount to be distributed to each library board of trustees on the basis of its needs, the Budget Commission may not reduce a library s allocation from the fund on account of additional revenues realized by a library from increased taxes or service charges voted by its electorate, from revenues received through federal or state grants, projects, or programs, or from grants from private sources. Furthermore, the amount paid to all libraries in the county may not be less than the average of the amounts distributed to the libraries in 1982, 1983, and Within the County, there are eight public library districts that share the PLF funds allocated to the County. The Budget Commission uses a formula to determine each library s share of the PLF funds in the County. This formula was negotiated and agreed to by each of the library districts in the County. Based on this formula, the Library received 60.64% of the Total Guaranteed Share in The table set forth below shows the distributions received by the Library since Year County Guaranteed Share County PLF Distributions Columbus Metropolitan Library Amount of Library s Guaranteed Share Library s % of Total Guaranteed Share 2008 $40,801,887 $24,407, % ,538,409 20,062, ,510,278 18,849, ,356,737 19,954, ,351,560 18,935, ,231,614 19,371, ,376,487 19,458, ,406,243 20,833, ,571,943 21,586, ,772,607 22,383, Source: Ohio Department of Taxation and the Columbus Metropolitan Library 1 Projected. A-16

45 THERE CAN BE NO ASSURANCE CONCERNING DETAILS OF AND/OR THE FUTURE LEVEL OF STATE FUNDING FOR THE PUBLIC LIBRARY FUND, IF ANY. FUNDING OF THE PUBLIC LIBRARY FUND MAY ALSO BE SUBJECT TO ADJUSTMENT OR REPEAL DURING A STATE BIENNIUM. THE SERIES 2017 NOTES ARE PAYABLE SOLELY FROM THE LIBRARY S PUBLIC LIBRARY FUNDS PLEDGED FOR THEIR PAYMENT. (SEE SECURITY AND SOURCE OF PAYMENT FOR THE LIBRARY S SPECIAL OBLIGATION DEBT ) Library Property Tax Base The following information is provided solely for informational purposes. The Series 2017 Notes are not secured by, nor are ad valorem taxes pledged to, the repayment of the Series 2017 Notes. Ad Valorem Taxes and Assessed Valuation Overview. For property taxation purposes, assessment of real property is performed on a calendar year basis by the elected County Auditor subject to supervision by the Tax Commissioner, and assessment of public utility property and tangible personal property is performed by the Tax Commissioner. Property taxes are billed and collected by the County Treasurer. Taxes collected from real property (other than public utility) in one calendar year are levied in the preceding calendar year on assessed values as of January 1 of that preceding year. Public utility real and tangible personal property taxes collected in one calendar year are levied in the preceding calendar year on assessed values determined as of December 31 of that second year preceding the tax collection year. Beginning with the 2009 tax year, general business tangible personal property is no longer subject to tax. Real Property. The assessed valuation of real property is fixed at 35% of true value and is determined pursuant to rules of the Tax Commissioner, except that real property devoted exclusively to agricultural use is assessed at not more than 35% of its current agricultural use value. Beginning in 2008, certain elderly or disabled resident homeowners may receive a flat $25,000 property tax exemption on the market value of their homestead. Ohio law requires the County Auditor, subject to supervision by the Tax Commissioner, to adjust the true value of taxable real property every six years to reflect current fair market values. This sexennial reappraisal is done by individual appraisal of properties. In the third year following a sexennial reappraisal, the County Auditor, again subject to supervision by the Tax Commissioner, performs a triennial update to adjust the value of taxable real property to reflect true values. The triennial update is done without individual appraisal of properties, but with reference to a sales-assessment ratio over the three-year period. Personal Property. In 2005, the State accelerated its phase-out of the tangible personal property tax. After 2008, general business tangible personal property is not subject to tax. Public utility tangible personal property including tangible personal property of electric utilities not used for transmission and distribution and all tangible personal property of gas utilities was not included in the phase-out created by the State. All public utility tangible personal property is assessed at varying percentages of its true value depending on the type of property and the type of utility. A-17

46 Assessed Valuation The following table classifies the Library s assessed valuation of taxable property according to use: Property Classification Assessed Valuation Columbus Metropolitan Library (2017 Collection Year) Amount Percent of Total Assessed Valuation Real Estate 1 Residential/Agricultural $11,744,254, % Commercial/Industrial/Mineral 6,268,807, Public Utility Real 12,502, Total Real Estate $18,025,563, % Personal Property 2 Public Utility Personal $715,919, % Total Assessed Valuation $18,741,483, % Source: Ohio Department of Taxation Change in Assessed Valuation Columbus Metropolitan Library Collection Year Assessed Valuation Percent Increase Over Prior Year 2010 $19,746,202, % ,631,642,590 (0.58) ,312,982,520 (6.72) ,154,830,270 (0.86) ,140,628,980 (0.08) ,102,119,280 (0.21) ,374,268, ,741,483, Source: Ohio Department of Taxation 1 Real property taxes collected in a calendar year are levied in the preceding calendar year on assessed values as of January 1 of that preceding year. Real property is assessed at 35% of market value and reappraised every six years, with triennial updates every three years. 2 Tangible personal property taxes collected in a calendar year are levied in the same calendar year, on assessed values during and at the close of the most recent fiscal year of the taxpayer (ending on or before March 30 of said calendar year) at tax rates determined in the preceding year. 3 Year of sexennial reappraisal. 4 Year of triennial update. A-18

47 Largest Taxpayers The following tables list the largest real estate and public utility taxpayers in the Library. Percentages of total assessed valuation are based on a total assessed valuation of $18,741,483,400 for the 2017 collection year. Name Largest Real Estate Taxpayers (2017 Collection Year) Type of Business Assessed Valuation Percent of Library s Total Assessed Valuation Nationwide Mutual Insurance Co. Insurance $76,683, % Distribution Land Corp. Warehousing 66,229, LSREF3 Bravo(Ohio) LLC Residential 41,615, Huntington Center Owner LLC Commercial Office 39,221, Columbus Regional Airport Airport 34,890, Ohio Bureau of Workers Government 34,825, State of Ohio Government 34,784, Easton Gateway LLC Shopping Center 22,238, Battelle Memorial Institute Research and Development 20,867, Wexner, Leslie H. Residential 19,566, Source: Franklin County Auditor Name Largest Public Utility Taxpayers (2017 Collection Year) Type of Business Assessed Valuation Percent of Library s Total Assessed Valuation Ohio Power Company Electric Utility $480,211, % Columbia Gas of Ohio Natural Gas Utility 103,909, AEP Ohio Transmission Company Inc. Electric Utility 72,183, AEP Ohio Transmission Company, Inc. Electric Utility 21,652, American Electric Power Service Electric Utility 17,836, Source: Franklin County Auditor A-19

48 History of Voted Taxes The table below provides the history of voted taxes in the Library since All issues listed were passed by the voters. History of Voted Taxes Columbus Metropolitan Library Election Date Levy or Bond Issue Description % Voting For % Voting Against 11/02/ Mill Operating Levy (Replacement w/ Increase, Continuing) 65.9% 34.1% 11/07/ Mill Operating Levy (Renewal, 10 years) /04/ Mill Operating Levy (Renewal w/increase, 15 years) /02/ Mill Operating Levy (Renewal, 5 years) /08/ Mill Operating Levy (New, 5 years) Source: Ohio Municipal Advisory Council and the Franklin County Board of Elections 1 First collection was in Currently, the Library does not anticipate requesting additional voted property tax millage in the next five years. Property Tax Rates The following are the rates (in mills per $1.00 of assessed valuation) at which the Library levied ad valorem taxes for the 2017 collection year. Library Tax Rates Columbus Metropolitan Library (2017 Collection Year) Collection Year Authorized Mills Rate Levied for Current Collection Year Residential/ Agricultural Commercial/ Industrial Source: Ohio Department of Taxation A-20

49 Property tax levies serve as the main source of operating revenue for the Library. In 2010, the electorate approved a 2.8 mill property tax levy for a continuing period, replacing a 2.2 mill levy with a 0.6 mill increase. Collection Year Current Year Charge Levied Property Tax Collections Columbus Metropolitan Library Current Year Collected 1 Total Taxes Collected 2 Total Taxes Percentage 2013 $54,764,452 $48,052,191 $49,931, % ,149,263 47,556,166 49,445, ,700,462 47,715,248 49,336, ,439,761 49,264,317 50,832, ,467,552 50,425,172 51,856, Source: Franklin County Auditor Tax Abatements and Economic Development Incentives Tax abatements are temporary property tax exemptions designed to stimulate economic growth or promote other activities deemed by the State to be in the public interest. Under Ohio law, tax abatements may be granted for urban renewal projects, community redevelopment corporations, community reinvestment areas, property acquired by municipal corporations engaged in urban redevelopment, enterprise zones, railroad property, and for any improvements declared to serve a public purpose in municipalities, townships, and counties. [Balance of Page Intentionally Left Blank] 1 Collections include paid State rollback payments, but not State reimbursement payments related to utility and personal property phaseouts. 2 Includes prior year delinquent taxes paid. A-21

50 Some of the local governments served by the Library have entered into various tax abatement agreements to encourage economic development. During the term of these agreements, the Library does not receive property tax revenue from the abated property. The table below summarizes the tax abatements and economic development incentives of the local governments served by the Library: Summary of Tax Abatements Government with Tax Abatement Agreement Amount of Property Taxes Abated City of Columbus $955,864 City of Groveport 345,905 City of New Albany 279,971 City of Obetz 250,260 City of Hilliard 30,794 City of Gahanna 26,662 City of Canal Winchester 8,715 City of Whitehall 7,810 Madison Township 5,301 Hamilton Township 3,439 City of Reynoldsburg 827 Jefferson Township 769 Total $1,916,317 Source: Columbus Metropolitan Library Currently, the Library is not a party to any compensation agreement related to tax exemptions or abatements. However, the Library may, from time to time, enter into compensation agreements with thirdparties with respect to exempted or abated real property tax value, and the Library may, from time to time, benefit from payments made under compensation agreements entered into between libraries and other local governments. A-22

51 Other Revenues The Library draws a small portion of the Library s operating resources come from fines, fees, investment earnings, contractual services, grants and gifts. The following table sets forth the total revenue the Library has received from these sources since Year Fines 1 Services Charges for Other Sources of Library Revenue - General Fund (Cash Basis) Investment Earnings Other Revenue Total Revenue 2013 $1,184,555 $694,314 $153,927 $ 274,213 $2,307, , , , ,693 2,484, , , , ,290 2,116, , , , ,222 2,287, , , ,180 1,287,762 3,478,427 Source: Columbus Metropolitan Library Statutory Debt Limitations LIBRARY DEBT The Library may issue notes payable from PLF revenues, such as the Series 2017 Notes, without a vote of the electors. Such notes are subject to the debt limitation set forth in Section of the Revised Code but are not subject to any other statutory debt limitations. Section of the Revised Code permits the issue of notes payable from PLF Receipts only if the maximum aggregate amount of notes payable from PLF Receipts, and available proceeds of a property tax levied under Revised Code Section , that will be outstanding after such issue does not exceed an amount which requires or is estimated to require aggregate annual debt service charges on the notes by the Board in an amount in excess of thirty percent (30%) of the average of the Library s PLF Receipts for the two calendar years immediately preceding the year in which the notes are issued and the property tax levy proceeds pledged for debt service charges. In the case of anticipation notes issued in anticipation of the issuance of notes payable from PLF revenues, and available property tax receipts, the projected debt service charges on the notes, and not on the anticipation notes, are used to calculate the percentage of revenue required to pay debt service. The average of the Library s PLF revenues received in 2015 and 2016, the two years prior to the year in which the Series 2017 Notes are issued, is $21,127,541 and 21,011,764. In 2017, the Library could issue additional PLF notes (payable solely from PLF and without regard to available proceeds of a property tax) having aggregate annual debt service payments of up to thirty percent (30%) of this amount or up to $6,320,896. Library Debt Currently Outstanding The Library does not have any outstanding general obligation debt. 1 Beginning January 1, 2007, the Library eliminated overdue fines on all borrowed materials. 2 Projected. A-23

52 Debt Service Requirements Notes: The following schedule presents the Library s actual debt service requirements for the Series 2017 Calendar Year Debt Service Requirements Columbus Metropolitan Library Outstanding Obligations The Notes Total Principal Interest Principal Interest Debt Service 2017 $2,855, $1,247, $4,102, ,880, ,463, $ 30, $348, ,721, ,930, ,417, , , ,722, ,985, ,362, , , ,721, ,060, ,287, , , ,721, ,210, ,140, , , ,728, ,690, ,986, ,685, , ,704, ,475, ,960, , ,743, ,525, ,905, , ,738, ,849, ,240, , ,398, ,849, ,385, , ,403, ,970, ,849, ,819, ,125, ,690, ,815, ,290, ,525, ,815, ,465, ,354, ,819, ,645, ,175, ,820, ,830, , ,819, ,975, , ,819, ,170, , ,815, ,380, , ,819, ,595, , ,818, Total $74,055,000 $33,208, $8,465, $3,162, $118,890, The Library is not in default in the payment of debt service on any obligations. Lease Obligations Under Ohio law, libraries have only the authority to lease or lease purchase any capital asset that is expressly granted by statute or necessarily implied from expressly granted authority. Express statutory authority exists for true leases (i.e., leases where no portion of the lease payment is applied toward the purchase of the capital asset) or lease-purchase or installment sale arrangements for the following: main libraries, branch libraries, library stations, buildings, parts of buildings, other real property, motor vehicles and other personal property necessary for the proper maintenance and operation of the public libraries under the control of the library. Except in cases where lease-purchase or installment sale arrangements include certain provisions providing that the obligations under such agreement may be terminated at the end of a fiscal year (e.g., a requirement of annual appropriation in order to extend the lease term beyond the current fiscal year), such agreements would constitute debt. The Library has existing leases for vehicles, swing space, and copiers totaling approximately $450,000 annually. None of such leases are federally tax-exempt. A-24

53 Future Financings The Library is considering replacement or renovation of certain aged facilities in the next five years, but the scope, amount, and timing of any additional capital financings therefor has not yet been determined. At such time, the Library will evaluate whether to secure such financings solely with PLF Receipts or a combination of PLF Receipts and property tax levy proceeds as now permitted under Revised Code Section [Balance of Page Intentionally Left Blank] A-25

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55 APPENDIX B AUDITED FINANCIAL STATEMENTS COLUMBUS METROPOLITAN LIBRARY FRANKLIN COUNTY, OHIO For the Fiscal Year Ended December 31, 2016 B- 1

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59 Board of Trustees Columbus Metropolitan Library 96 South Grant Avenue Columbus, Ohio We have reviewed the Independent Auditor s Report of the Columbus Metropolitan Library, Franklin County, prepared by Plante & Moran, PLLC, for the audit period January 1, 2016 through December 31, Based upon this review, we have accepted these reports in lieu of the audit required by Section , Revised Code. The Auditor of State did not audit the accompanying financial statements and, accordingly, we are unable to express, and do not express an opinion on them. Our review was made in reference to the applicable sections of legislative criteria, as reflected by the Ohio Constitution, and the Revised Code, policies, procedures and guidelines of the Auditor of State, regulations and grant requirements. The Columbus Metropolitan Library is responsible for compliance with these laws and regulations. Dave Yost Auditor of State June 29, East Broad Street, Fifth Floor, Columbus, Ohio Phone: or Fax:

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61 Columbus Metropolitan Library Columbus, Ohio COMPREHENSIVE ANNUAL FINANCIAL REPORT For Fiscal Year Ended December 31, 2016 Issued by: Paula L. Miller Chief Financial Officer/Fiscal Officer

62 COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2016 TABLE OF CONTENTS INTRODUCTORY SECTION Title Page Table of Contents Library Officials and Staff Organizational Chart Letter of Transmittal Certificate of Achievement for Excellence in Financial Reporting PAGE i ii v vi vii x FINANCIAL SECTION Independent Auditor s Report 3 Management s Discussion and Analysis 7 Basic Financial Statements: Government-Wide Financial Statements: Statement of Net Position 15 Statement of Activities 16 Fund Financial Statements: Balance Sheet - Governmental Funds 18 Reconciliation of Total Governmental Fund Balances to Net Position of Governmental Activities 19 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds 20 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities - Governmental Funds 21 Statement of Revenues, Expenditures and Changes in Fund Balance - Budget (Non-GAAP Basis) and Actual - General Fund 22 Statement of Net Position - Proprietary Fund 23 Statement of Revenues, Expenses and Changes in Net Position - Proprietary Fund 24 Statement of Cash Flows - Proprietary Fund 25 Statement of Fiduciary Assets and Liabilities - Agency Fund 26 Notes to the Basic Financial Statements 27 -ii-

63 Required Supplementary Information: Schedule of Library s Proportionate Share of the Net Pension Liability/(Asset) - Ohio Public Employees Retirement System 53 Schedule of Library Contributions - Ohio Public Employees Retirement System 54 Supplementary Information: Fund Descriptions 55 Supplemental Schedules - General Fund: Combining Supplemental Schedule of Assets, Liabilities and Fund Balances - General Fund 56 Combining Supplemental Schedule of Revenues, Expenditures and Changes in Fund Balances - General Fund 57 Supplemental Schedules - Capital Projects Fund: Combining Supplemental Schedule of Assets, Liabilities and Project Balances - Capital Projects Fund 58 Combining Supplemental Schedule of Revenues, Expenditures and Changes in Project Balances - Capital Projects Fund 59 Combining Statements - Nonmajor Governmental Funds: Combining Balance Sheet - Nonmajor Governmental Funds 60 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds 61 Combining Balance Sheet - Nonmajor Special Revenue Funds 62 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Special Revenue Funds 63 Combining Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget (Non-GAAP Basis) and Actual - General Fund 64 Individual Schedules of Revenues, Expenditures and Changes in Fund Balance - Budget (Non-GAAP Basis) and Actual - Nonmajor Funds: Restricted - Special Revenue Fund 68 Land Development - Special Revenue Fund 69 Permanent Fund 70 Debt Service Fund 71 Capital Projects Fund 72 Statement of Changes in Fiduciary Assets and Liabilities - Agency Fund 73 -iii-

64 STATISTICAL SECTION Section Overview 77 Net Position by Component - Last Ten Years 78 Changes in Net Position - Last Ten Fiscal Years 79 Fund Balances, Governmental Funds - Last Ten Fiscal Years 80 Changes in Fund Balances, Governmental Funds - Last Ten Fiscal Years 81 Assessed and Estimated Actual Value of Taxable Property - Last Ten Fiscal Years 82 Direct and Overlapping Property Tax Rates, - Last Ten Fiscal Years 84 Principal Property Taxpayers - Current Year and Nine Years Ago 87 Property Tax Levies and Collections - Last Ten Fiscal Years 88 Ratios of Outstanding Debt by Type 89 Ratios of General Bonded Debt Outstanding 90 Direct and Overlapping Governmental Activities Debt 91 Demographic and Economic Statistics - Last Ten Calendar Years 92 Principal Employers - Current Year and Nine Years Ago 93 Branch Information - Last Ten Fiscal Years 94 Operation Indicators - Last Ten Fiscal Years 96 Employment Trend - Last Ten Fiscal Years 97 COMPLIANCE SECTION Independent Auditor s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Required by Government Auditing Standard 98 -iv-

65 LIBRARY OFFICIALS AS OF DECEMBER 31, 2016 BOARD OF TRUSTEES Mr. Roger Sugarman Mr. Michael Lawson Mr. Tim Frommeyer Ms. Cynthia A. Hilsheimer Ms. Erika Clark Jones Ms. Katie Chatas Mr. Mike Duffy President of the Board Vice President of the Board Secretary of the Board Member Member Member Member EXECUTIVE STAFF Mr. Patrick Losinski Ms. Alison Circle Ms. Paula L. Miller Mr. Carl Powell Ms. Susan Zelinski Chief Executive Officer Chief Customer Experience Officer Chief Financial Officer/Fiscal Officer Chief Information Officer Chief Talent Officer -v-

66 COLUMBUS METROPOLITAN LIBRARY CML Organization Chart PROMOTES ORGANIZATION WIDE EXECUTION WHILE FOCUSING ON THE CUSTOMER CML BOARD OF TRUSTEES STRATEGIC PLANNING TEAM CHIEF EXECUTIVE OFFICER DEVELOPMENT & AFFINITY CML FOUNDATION CHIEF FINANCIAL OFFICER 2020 VISION PLAN FINANCE PROPERTY MANAGEMENT PROCUREMENT HUMAN RESOURCES LEARNING & DEVELOPMENT CHIEF TALENT OFFICER STRATEGIC INITIATIVES CUSTOMERS SECURITY COLLECTION MARKETING VOLUNTEERS LEAN MANAGEMENT 23 LOCATIONS INFORMATION TECHNOLOGY EXPERIENCE OFFICER CHIEF CUSTOMER READY TO READ CHIEF INFORMATION OFFICER FRIENDS OF THE LIBRARY MANAGEMENT TEAM -vi-

67 EMENCHNICAL SERVICES May 25, 2017 To the Citizens of the City of Columbus and Franklin County and The Board of Trustees and Chief Executive Officer of Columbus Metropolitan Library The Ohio Revised Code requires that every general purpose local government publish, within six months of the close of each fiscal year, a complete set of audited financial statements. This report is published to fulfill that requirement for the fiscal year ended December 31, Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal control that it has established for this purpose. Because the cost of internal control should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements. Columbus Metropolitan Library s (CML) financial statements have been audited under contract with the Auditor of State of Ohio by Plante & Moran, a firm of licensed certified public accountants. The independent auditor concluded that CML s financial statements for the fiscal year ended December 31, 2016, are fairly presented in conformity with accounting principles generally accepted in the United States of America. The independent auditor s report is presented as the first component of the financial section of this report. Management s discussion and analysis (MD&A) immediately follows the independent auditor s report and provides a narrative introduction, overview, and analysis of the basic financial statements. MD&A complements this letter of transmittal and should be read in conjunction. Profile of the Government Columbus City Council established a free, tax-supported library in 1872, which opened as the Public Library and Reading Room of Columbus inside a newly built City Hall in The State of Ohio established CML as a county district library in 1976 with a legal service district of Franklin County, except for the legal service areas of the other six library systems within the county (Bexley, Upper Arlington, Grandview, Southwest, Worthington, and Westerville). Today CML consists of Main Library on South Grant Avenue and twenty-two branches throughout the county. CML also contributes to the operation of a branch owned by Worthington Libraries, a separate legal entity, which serves citizens of both library districts. -vii-

68 CML s collection contains approximately 2 million items including books, ebooks, audio books, music CDs, DVDs, digital downloads, magazines, newspapers, maps and sheet music all of which circulated 16.1 million times in In addition to our materials, each of CML s locations has computers and Wi-Fi access available for public use. CML s website also offers access to a wealth of electronic databases through this site provides access to directories, indexes, abstracts and full-text information on careers, education, genealogy, consumer information, obituaries, literature and researching businesses. CML receives financial support from two component units. The Friends of CML raise funds through sales of books, miscellaneous CML branded merchandise, and the operation of The Library Store located inside Main Library. The Friends of CML help fund critical CML programs like Summer Reading Club, Homework Help Centers and CML s levy campaigns. The Friends of CML are excluded from the entity-wide financial statements due to immateriality. More information about the Friends of CML can be found at The Columbus Metropolitan Library Foundation (CMLF) collects donations to support CML s programs. CMLF annually hosts the fundraising event, Celebration of Learning to raise funds that support library programming. In 2016, Celebration of Learning raised over $400,000. CMLF is discretely presented as a component unit in the entity-wide financial statements. More information about CMLF can be found at CML is under the control and management of a seven member Board of Trustees; three Board members are appointed by the Judges of the Court of Common Pleas and four are appointed by the Franklin County Commissioners. CML is a separate legal entity, financially and operationally independent from the City of Columbus and Franklin County. The Board of Trustees has sole authority to request a rate and purpose for a tax levy. The Board reviews and approves an annual budget prior to the beginning of each year for each fund at the total expenditures level. Any necessary re-appropriations require Board approval. Management is responsible for making further breakdowns in the budget, tracking and reporting expenditures throughout the year. CML prepares its financial statements in accordance with Governmental Accounting Standards Board (GASB) Statement No. 39, Determining Whether Certain Organizations are Component Units an amendment to GASB Statement No. 14 and GASB Statement No. 61, The Financial Reporting Entity: Omnibus an amendment of GASB Statements No. 14 and No. 34. Information regarding the reporting standards and bases of accounting used in preparation of the financial statements can be found in Note 1 Summary of Significant Accounting Policies. Economic Condition CML is located entirely within Franklin County, Ohio. Franklin County s population as estimated by Woods & Poole Economics is 1,252,492 at December 31, 2016, an increase of 0.9 percent for the year and increase of 4.6 percent in the last five years. Unemployment data indicate the U.S. economy and that of Franklin County is beginning to show signs of improvement. As of January, 2017 the most recent data available, the United States unemployment rate was 4.8% compared to the State of Ohio unemployment rate of 5.0%. Meanwhile, the Franklin County unemployment rate for January 2017 (the most recent county data available) is below both the state and national rates at 4.6% as it is supported by the strong and diverse economy of the Columbus metropolitan area. Source: Ohio Department of Job and Family Services ( -viii-

69 CML s operational revenue is based on two major sources of funding, the Public Library Fund (PLF) and a local property tax levy. The PLF is an amount which the State of Ohio appropriates in their biennium budget to support libraries throughout Ohio. Each county receives an allocation of 1.7% of Ohio s General Revenue Fund for the State Fiscal Year 16 and 17 biennium. The second major source of CML s operational revenue is a 2.8 mill continuing property tax levy which was overwhelmingly supported by Franklin County voters in the fall of In late 2012, CML issued $92 million in bonds to support CML s aspirational building program. CML is building new branches and renovating existing branches to better serve community needs. New branches opened to serve Columbus Marion Franklin and Driving Park communities in A new branch in Whitehall opened in April of 2015 and a new branch in Canal Winchester opened in January of Four other existing locations were renovated and reopened in 2016, including Main Library which closed in April 2015 for the renovation and reopened in June of 2016, as well as Parsons, Shepard, and Northern Lights. The Northside Branch was under construction as of December 31, More information about CML s building program can be found at Awards and Acknowledgements The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the CML for its Comprehensive Annual Financial Report for the fiscal year ended December 31, This was the thirtieth consecutive year that CML has achieved this prestigious award. In order to be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized comprehensive annual financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe our current comprehensive annual financial report continues to meet the Certificate of Achievement program requirements and we are submitting it to GFOA to determine its eligibility for another certificate. This report is issued by Paula L. Miller, CFO/Fiscal Officer. Thanks and recognition go to the entire staff of CML s Financial Services Department. I also wish to express my appreciation to CML s executives and the members of the Board for their continued interest and support in planning and conducting the financial operations of CML in a responsible and progressive manner. Respectfully Submitted, Paula L. Miller Chief Financial Officer/Fiscal Officer -ix-

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71 FINANCIAL SECTION 1

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73 Independent Auditor's Report To the Board of Trustees Columbus Metropolitan Library Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, each major fund, the aggregate remaining fund information, and the discretely presented component unit of the Columbus Metropolitan Library, Franklin County, Ohio (the "Library"), as of and for the year ended December 31, 2016, and the related notes to the financial statements, which collectively comprise the Columbus Metropolitan Library's basic financial statements as listed in the table of contents. Management s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We did not audit the financial statements of the Columbus Metropolitan Library Foundation, which represents the entire discretely presented component unit. Those financial statements were audited by other auditors, whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for the Columbus Metropolitan Library, is based solely on the report of the other auditors. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. The financial statements of the Columbus Metropolitan Library Foundation were not audited under Government Auditing Standards. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. 3

74 To the Board of Trustees Columbus Metropolitan Library Opinions In our opinion, based on our audit and the report of other auditors, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, the aggregate remaining fund information, and the discretely presented component unit of the Columbus Metropolitan Library as of December 31, 2016, and the respective changes in its financial position, and, where applicable, cash flows thereof, and the respective budgetary comparison for the General Fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management's discussion and analysis, the schedule of the Library's proportionate share of the net pension liability/(asset), and the schedule of Library contributions, as listed in the table of contents, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, which considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Columbus Metropolitan Library's basic financial statements. The financial section's combining statements and individual fund statements and schedules and the statement of changes in fiduciary assets and liabilities, the introductory section, and the statistical section are presented for the purpose of additional analysis and are not a required part of the basic financial statements. The financial section's combining statements and individual fund statements and schedules and the statement of changes in fiduciary assets and liabilities are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the financial section's combining statements and individual fund statements and schedules and the statement of changes in fiduciary assets and liabilities are fairly stated, in all material respects, in relation to the basic financial statements as a whole. The introductory section and statistical section have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on them. 4

75 To the Board of Trustees Columbus Metropolitan Library Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated May 25, 2017 on our consideration of the Columbus Metropolitan Library's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements, and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Columbus Metropolitan Library's internal control over financial reporting and compliance. May 25,

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77 COLUMBUS METROPOLITAN LIBRARY Management s Discussion and Analysis For the Year Ended December 31, 2016 (UNAUDITED) As management of the Columbus Metropolitan Library (CML), we offer readers of CML s financial statements this narrative overview and analysis of the financial activities of CML for the fiscal year ended December 31, We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, the financial statements, and the notes to the financial statements. Financial Highlights Key financial highlights for the fiscal year 2016 are as follows: The assets and deferred outflows of resources of CML exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by $161,940,967. Of this amount, $88,295,590 was unrestricted and may be used to meet CML s ongoing obligations. CML s net position increased by $11,352,012 or 7.5%. Of the $86,470,636 in total revenue, general revenue accounted for $84,123,323 or 97.3%. Program specific revenue in the form of charges for services, grants and contributions accounted for $2,347,313 or 2.7%. CML had $75,118,624 in expenses related to governmental activities; 3.1% of these expenditures were offset with program specific revenue. The remaining 96.9% was provided by general revenue of CML, including Property Taxes, State of Ohio shared revenue, capital grants, and investment earnings. CML has three major funds: the general fund, the capital projects fund, and the debt service fund. Under the modified accrual basis of accounting, the general fund had $69,066,307 in revenue and other financing sources and $65,770,933 in expenditures, resulting in an increase in fund balance of $3,295,374. At the end of the fiscal year, the unassigned fund balance in the general fund was $64,740,276. This represents 86.1% of total fund balance in the general fund and 98.4% percent of 2016 general fund expenditures. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to CML s basic financial statements. CML s basic financial statements are comprised of three components: (1) government-wide financial statements, (2) fund financial statements and (3) notes to the financial statements. This report contains other supplementary information in addition to the basic financial statements themselves. Government-wide Financial Statements The government-wide financial statements are designed to provide readers with a broad overview of CML s finances, in a manner similar to private-sector business. The Statement of Net Position presents information on all of CML s assets, deferred outflows of resources, liabilities and deferred inflows of resources, with the difference reported as net position. Over time, increases and decreases in net position may serve as a useful indicator of whether the financial position of CML is improving or deteriorating. 7

78 COLUMBUS METROPOLITAN LIBRARY Management s Discussion and Analysis For the Year Ended December 31, 2016 (UNAUDITED) The Statement of Activities presents information showing how CML s net position changed during the most recent fiscal year. All changes to net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of the cash flows. Thus, revenue and expenses reported in the statement for some items will only result in cash flows in future periods (e.g., uncollected taxes and earned but unused leave). Fund Financial Statements A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. CML uses fund accounting to assure and demonstrate compliance with finance-related legal requirements. The funds of CML are divided into three categories: governmental funds, proprietary funds, and fiduciary funds. Governmental Funds Governmental funds focus on the near-term inflows and outflows of spendable financial resources, as well as on the balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating CML s near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, a reader may better understand the long-term impact of the government s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenue, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. CML maintains six individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenue, expenditures and changes in fund balances for the general fund, the capital projects fund, and the debt service fund, all of which are considered to be major funds. Data from the other three governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non-major governmental funds is provided in the form of combining statements elsewhere in this report. Proprietary Funds CML s only proprietary fund is the self-insurance fund. The self-insurance fund is an internal service fund. Internal service funds are an accounting device used to accumulate and allocate costs internally among the CML s various functions. The service provided by this fund benefits the governmental funds and has been included within governmental activities in the government-wide financial statements. Fiduciary Funds CML s only fiduciary fund is the digital downloads fund. The digital downloads fund is an agency fund. An agency fund is an accounting device used to report assets held in a custodial manner by one government on behalf of other member governments. CML does not derive any benefits from the assets held in the agency fund, and reports only the assets and the corresponding liabilities associated with the fund. Notes to the Financial Statements The notes provide additional information that is essential to the full understanding of the data provided in the government-wide and fund financial statements. Other Information In addition to the basic financial statements and accompanying notes, this report also presents required supplementary information concerning CML s progress in funding its obligation to provide pension benefits to its employees. 8

79 Government-wide Financial Analysis COLUMBUS METROPOLITAN LIBRARY Management s Discussion and Analysis For the Year Ended December 31, 2016 (UNAUDITED) The Statement of Net Position provides the perspective of CML as a whole. Table 1 provides a summary of CML s net position for 2016 compared to Table 1 Net Position Governmental Activities Assets Current and Other Assets $ 182,140,832 $ 214,886,305 Long-term Assets: Capital Assets, Net 142,711, ,091,107 Net Pension Asset 122,249 86,146 Total Assets 324,974, ,063,558 Deferred Outflows of Resources Deferred Amount on Refunding 429,361 - Pension 14,200,688 4,793,223 Total Deferred Outflows of Resources 14,630,049 4,793,223 Liabilities Current Liabilites 5,405,637 8,138,683 Long-Term Liabilities: Net Pension Liability 36,103,396 25,377,918 Other Amounts 90,510,618 93,215,310 Total Liabilities 132,019, ,731,911 Deferred Inflows of Resources Property Taxes 44,726,155 45,063,788 Pension 917, ,127 Total Deferred Inflows of Resources 45,643,996 45,535,915 Net Position Net Investment in Capital Assets 72,339,611 67,209,856 Restricted 1,305,766 5,219,763 Unrestricted 88,295,590 78,159,336 Total Net Position $ 161,940,967 $ 150,588,955 Current and Other Assets decreased significantly in comparison with the prior year and Capital Assets, Net increased significantly in comparison with the prior year. These fluctuations are primarily the result of the continuation of CML s building program. Current Liabilities decreased significantly in comparison with the prior. This decrease is primarily the result of a decrease in accounts payable related to CML s building program. Other Long-Term Liabilities (mainly bonds used for construction) decreased significantly in comparison with the prior year. This decrease primarily represents a principal payment made in

80 COLUMBUS METROPOLITAN LIBRARY Management s Discussion and Analysis For the Year Ended December 31, 2016 (UNAUDITED) Deferred Outflows of Resources and Net Pension Liability both increased significantly in comparison with the prior year. These increases are primarily the result of lower than expected returns on pension fund investments, as reported by the pension system. Table 2 shows a comparison of the changes in net position for the fiscal year ended December 31, 2016 compared to December 31, Table 2 Changes in Net Position Revenues Program Revenues Charges for Services 2,045,292 Governmental Activities $ $ 1,977,619 Operating Grants and Contributions 302, ,653 General Revenues Property Taxes 46,920,532 42,967,424 Intergovernmental 25,796,415 27,478,601 Capital Contributions 9,950,187 5,748,133 Investment Earnings 1,219,238 1,022,906 Miscellaneous 236, ,965 Total Revenues 86,470,636 79,996,301 Program Expenses Public Service 43,771,043 37,072,271 Administrative and Support 28,489,455 25,116,698 Interest Expense 2,783,526 2,894,941 Issuance Costs 74,600 - Total Expenses 75,118,624 65,083,910 Increase in Net Position 11,352,012 14,912,391 Net Position - Beginning Balance 150,588, ,676,564 Net Position - Ending Balance $ 161,940,967 $ 150,588,955 Capital Contributions increased significantly in comparison with the prior year. This increase is primarily the result of a $6 million donation received for the new Hilliard branch location. Property Taxes, a major source of revenue for CML in 2016, is the revenue generated by the 2.8 mill property tax levy. In November 2010, a 2.2 mill levy was replaced with an additional 0.6 mill levy by the voters in CML's taxing district. The increase in Property Taxes is primarily the result of new construction and an increase in property taxes available for advance at year-end. A major source of funding for CML is money received from the State of Ohio's Public Library Fund (PLF). The source of money for this fund comes from a percentage of the state taxes collected in Ohio including, state income tax and sales tax. 10

81 COLUMBUS METROPOLITAN LIBRARY Management s Discussion and Analysis For the Year Ended December 31, 2016 (UNAUDITED) Based on this formula, a percentage of this fund is distributed to each county for use by the public library districts within that county. Within Franklin County there are seven (7) public library districts that share this revenue. Each library's share of the fund is established by the Budget Commission. The Budget Commission uses a formula to determine each library's share of the money; however, the use of a formula is not mandatory under Ohio law. This formula was negotiated and agreed to by each of the library districts within the county. Based on this formula, CML received 60.87% of Franklin County s distribution in Program expenses increased significantly in comparison with the prior year. This increase is the result of a combination of factors, including several buildings that were closed for construction were reopened in 2016, inflationary increases in employee salaries and benefits, and an increase in pension expense, as reported by the pension system. The Statement of Activities shows the cost of program services and the charges for services, grants, and contributions offsetting those services. Table 3 shows the total cost of services and the net cost of services. That is, it identifies the cost of those services supported by general revenue, consisting primarily of taxes and state shared revenue. Table 3 Governmental Activities Total Cost of Services Net Cost of Services Program Expenses Public Service $ 43,771,043 $ 37,072,271 $ 42,913,466 $ 36,111,131 Administrative and Support 28,489,455 25,116,698 26,999,719 23,722,566 Interest Expense 2,783,526 2,894,941 2,783,526 2,894,941 Issuance Costs 74,600-74,600 - Total Expenses $ 75,118,624 $ 65,083,910 $ 72,771,311 $ 62,728,638 The above schedule clearly shows the dependence upon tax revenue and state subsidies for governmental activities. Program revenue, such as charges for services, grants and contributions, cover only 3.1% of the expenses related to the activities performed by CML. The remaining 96.9% of expenses is provided through taxes, intergovernmental revenue, capital contributions, and investment earnings. Activities for Fiscal Year Ended December 31, ,000,000 43,771,043 40,000,000 30,000,000 28,489,455 20,000,000 10,000,000-2,783, ,577 1,489, ,600 Public Service Administrative and Support Interest Expense Issuance Costs Program Revenue Expenses 11

82 COLUMBUS METROPOLITAN LIBRARY Management s Discussion and Analysis For the Year Ended December 31, 2016 (UNAUDITED) Fund Financial Analysis The purpose of CML s governmental funds is to account for information on near-term inflows, outflows and balances of spendable resources. Such information is useful in assessing CML s financing requirements. In particular, unassigned fund balance may serve as a useful measure of CML s net resources available for spending at the end of the fiscal year. General Fund At year-end, the fund balance in CML s general fund was $75,211,969, an increase of $3,295,374 in comparison with the prior year. For the most part, this increase represents the amount in which property tax and intergovernmental revenue exceeded program expenditures. Of CML s ending general fund fund balance, $64,740,276 represents the unassigned portion, which is available for spending at CML s discretion. This unassigned fund balance represents 98.4 percent of 2016 general fund expenditures. Capital Projects Fund At year-end, the fund balance in CML s capital projects fund was $47,619,061, a decrease of $32,100,652 in comparison with the prior year. This decrease represents the amount in which expenditures exceeded capital grants and contributions. This trend is expected to continue as CML spends down the bond proceeds received in 2012 to build new and renovate existing libraries. Debt Service Fund At year-end, the fund balance in CML s debt service fund was $962,227, a decrease of $8,948 in comparison with the prior year. Other Governmental Funds At year-end, the fund balance in CML s other governmental funds was $1,208,863, an increase of $328,966 in comparison with the prior year. This increase represents the amount in which charges for services and contributions exceeded program expenditures. General Fund Budgeting Highlights CML s budget is prepared according to Ohio law and is based on accounting for certain transactions on a basis of cash receipts, disbursements, and encumbrances. The most significant budgeted fund for 2016 is the general fund. Both the original and final revenue budgets for the general fund were $69,439,812. Actual revenue was $599,562 more than the final budgeted numbers. This variance is the result of property tax revenue being more than was budgeted for. The original and final expenditure budgets for the general fund were $76,631,885 and $76,489,255, respectively. The decrease between the original and final budgets was primarily the result of a decrease in budgeted public service and administrative support offset by an increase in capital outlay and public service. Actual budgetary expenditures were $69,785,939, or $6,703,316 less than the final budget. This decrease is primarily the result of strong fiduciary practices by management. CML s ending budget basis fund balance for the General Fund is $70,548,

83 COLUMBUS METROPOLITAN LIBRARY Management s Discussion and Analysis For the Year Ended December 31, 2016 (UNAUDITED) Capital Assets At the end of fiscal year 2016, CML had $142,711,484 invested in capital assets. Table 4 shows fiscal year ended December 31, 2016 compared to December 31, Table 4 Capital Assets (Net of Depreciation) Governmental Activities Land $ 13,653,704 $ 12,842,451 Construction in Progress 12,245,209 25,981,977 Buildings and Improvements 116,003,676 63,492,015 Machinery and Equipment 808, ,664 Totals $ 142,711,484 $ 103,091,107 During 2016, CML s capital assets increased $39,620,377. This increase represents the amount in which capital asset additions, mostly related to new construction on multiple branch projects, exceeded current year depreciation and disposals. See Note 4 for additional capital asset information. Capital Assets at December 31, 2016 Land Construction in Progress Buildings and Improvements Machinery and Equipment Debt At year-end, CML had general obligation bonds outstanding totaling $83,210,000, a decrease of $1,200,000 in comparison with the prior year. This decrease represents debt principal payments made and bonds refunded during the year offset by the new debt issuance. See Note 11 for additional debt information. 13

84 Contacting CML s Financial Management COLUMBUS METROPOLITAN LIBRARY Management s Discussion and Analysis For the Year Ended December 31, 2016 (UNAUDITED) This financial report is designed to provide our citizens and taxpayers with a general overview of CML s finances and to show CML s accountability for the money it receives. If you have any questions about this report or need additional financial information, please contact Abby Cover, Accounting Manager at Columbus Metropolitan Library, 96 South Grant Ave., Columbus, Ohio or by at acover@columbuslibrary.org. 14

85 COLUMBUS METROPOLITAN LIBRARY Statement of Net Position December 31, 2016 Primary Component Government Unit Governmental Columbus Metropolitan Activities Library Foundation Assets Equity in Pooled Cash and Investments $ 109,009,755 $ 596,376 Cash and Cash Equivalents - Restricted 17,474,937 - Cash with Trustee 484,426 - Receivables: Taxes 49,673,707 - Accounts 63,212 - Intergovernmental 4,301,784 - Interest 316,805 - Pledges - 2,452,071 Prepaid Items 816,206 1,015 Assets Held by Others - 4,788,319 Capital Assets: Nondepreciable 25,898,913 - Depreciable, Net 116,812,571 - Net Pension Asset 122,249 Cash Surrender Value of Life Insurance Policy - 212,429 Total Assets 324,974,565 8,050,210 Deferred Outflows of Resources: Deferred Amount on Refunding 429,361 - Pension 14,200,688 - Total Deferred Outflows of Resources 14,630,049 - Liabilities Accounts Payable 1,984,246 57,596 Accrued Wages and Benefits 1,577,148 - Intergovernmental Payable 492,293 - Retainage Payable 668,638 - Claims Payable 385,000 - Accrued Interest Payable 239,884 - Security Deposits 58,428 - Amounts Held on Behalf of Others - 590,782 Long-Term Liabilities: Due Within One Year 3,118,140 - Due in More Than One Year Net Pension Liability 36,103,396 - Other Amounts Due in More Than One Year 87,392,478 - Total Liabilities 132,019, ,378 Deferred Inflows of Resources: Property Taxes 44,726,155 - Pension 917,841 - Total Deferred Inflows of Resources 45,643,996 - Net Position Net Investment in Capital Assets 72,339,611 - Restricted for: Restricted Donations 514, ,514 Debt Service 722,343 - Permanent Fund - Expendable 1,055 - Permanent Fund - Non-expendable 67,742 - Unrestricted 88,295,590 6,525,318 Total Net Position $ 161,940,967 $ 7,401,832 See accompanying notes to the basic financial statements 15

86 COLUMBUS METROPOLITAN LIBRARY Statement of Activities For the Year Ended December 31, 2016 Program Revenues Operating Charges for Grants and Functions/Programs Expenses Services Contributions Primary Government: Governmental Activities: General Government: Public Service $ 43,771,043 $ 555,556 $ 302,021 Administrative and Support 28,489,455 1,489,736 - Interest on Long Term Debt 2,783, Bond Issuance Costs 74, Total Governmental Activities $ 75,118,624 $ 2,045,292 $ 302,021 Component Unit: Columbus Metropolitan Library Foundation 4,538,076-2,143,332 General Revenues: Property Taxes Intergovernmental - Unrestricted Capital Contributions - Not Program Specific Investment Earnings Miscellaneous Total General Revenues Change in Net Position Net Position at Beginning of Year Net Position at End of Year See accompanying notes to the basic financial statements 16

87 Net (Expense) Revenue and Changes in Net Position Primary Component Government Unit Governmental Columbus Metropolitan Activities Library Foundation $ (42,913,466) $ - (26,999,719) - (2,783,526) - (74,600) - (72,771,311) - (2,394,744) 46,920,532-25,796,415-9,950,187-1,219, , ,951 9,660 84,123, ,702 11,352,012 (2,113,042) 150,588,955 9,514,874 $ 161,940,967 $ 7,401,832 See accompanying notes to the basic financial statements 17

88 COLUMBUS METROPOLITAN LIBRARY Balance Sheet Governmental Funds December 31, 2016 Capital Debt Other Total General Projects Service Governmental Governmental Fund Fund Fund Funds Funds Assets: Equity in Pooled Cash and Investments $ 74,145,921 $ 31,351,441 $ - $ 1,111,088 $ 106,608,450 Cash and Cash Equivalents - Restricted - 17,407,195-67,742 17,474,937 Cash with Trustee , ,426 Receivables: Taxes 49,673, ,673,707 Accounts 63, ,212 Intergovernmental 3,715, , ,194 4,301,784 Interest - 316, ,805 Prepaid Items 812,471 3, ,206 Total Assets $ 128,411,100 $ 49,079,055 $ 962,227 $ 1,287,145 $ 179,739,527 Liabilities: Accounts Payable $ 1,298,114 $ 665,551 $ - $ 19,854 $ 1,983,519 Accrued Wages and Benefits 1,577, ,577,148 Intergovernmental Payable 492, ,293 Retainage Payable - 668, ,638 Security Deposits ,428 58,428 Total Liabilities 3,367,555 1,334,189-78,282 4,780,026 Deferred Inflows of Resources: Property Taxes 44,726, ,726,155 Unavailable Revenue 5,105, , ,231,226 Total Deferred Inflows of Resources 49,831, , ,957,381 Fund Balances: Nonspendable: Prepaid Items 812,471 3, ,206 Permanent Fund Principal ,742 67,742 Restricted for: Capital Projects - 17,407, ,407,195 Debt Service , ,227 Permanent Fund Expendable ,055 1,055 Restricted Donations , ,505 Committed for: Library Materials 150, ,670 Operations/Programing 7,333, ,333,861 Facility and Technology Projects 1,863, ,863,475 Capital Projects - 4,032, ,032,761 Land Development , ,440 Assigned for: Library Materials 343, ,530 Operations/Programing 85, ,432 Facility and Technology Projects 5,529, ,529,223 27th Pay Period 1,230, ,230,325 Capital Projects - 26,175, ,175,491 Unassigned 57,862, ,862,982 Total Fund Balances 75,211,969 47,619, ,227 1,208, ,002,120 Total Liabilities, Deferred Inflows of Resources and Fund Balances $ 128,411,100 $ 49,079,055 $ 962,227 $ 1,287,145 $ 179,739,527 See accompanying notes to the basic financial statements 18

89 COLUMBUS METROPOLITAN LIBRARY Reconciliation of Total Governmental Fund Balances To Net Position of Governmental Activities December 31, 2016 Total Governmental Fund Balances $ 125,002,120 Amounts reported for governmental activities in the Statement of Net Position are different because: Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds. 142,711,484 The net pension asset is not a financial resource and therefore is not reported in the funds. 122,249 Other long-term assets are not available to pay for current period expenditures and therefore are reported as unavailable in the funds. Property Taxes Receivable 2,730,421 Intergovernmental Receivable 2,375,000 Interest Receivable 125,805 Governmental funds report the effect of bond premiums, discounts, and similar items when debt is first issued, whereas these amounts are deferred and amortized in the statement of net position. Unamortized Amount on Refunding 429,361 Unamortized Premium on Bonds (4,998,429) Internal service funds are used by management to charge the costs of health care to individual funds. The assets and liabilities of the internal service funds are included in governmental activities in the statement of net position. 2,015,578 Long-Term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds: Compensated Absences Payable (2,302,189) General Obligation Bonds Payable (83,210,000) Accrued Interest Payable (239,884) The net pension liability is not due and payable in the current period; therefore, the liability and related deferred inflows/outflows are not reported in governmental funds: Deferred Outflows - Pension 14,200,688 Deferred Inflows - Pension (917,841) Net Pension Liability (36,103,396) Net Position of Governmental Activities $ 161,940,967 See accompanying notes to the basic financial statements 19

90 COLUMBUS METROPOLITAN LIBRARY Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds For the Year Ended December 31, 2016 Capital Debt Other Total General Projects Service Governmental Governmental Fund Fund Fund Funds Funds Revenues: Property Taxes $ 46,577,352 $ - $ - $ - $ 46,577,352 Intergovernmental 20,210,484-5,764,502-25,974,986 Fines and Fees 555, ,556 Investment Earnings 845, ,322 4,095 5,559 1,221,898 Charges for Services 692, ,314 1,489,736 Contributions and Donations 50,075 9,950, ,946 10,252,208 Miscellaneous 122,257 74,573-40, ,951 Total Revenues 69,054,068 10,391,082 5,768,597 1,094,940 86,308,687 Expenditures: Current: Public Service 38,431, ,198 38,666,564 Administrative and Support 25,143, ,076 25,663,648 Capital Outlay 2,195,995 43,404,753-10,700 45,611,448 Debt service: Principal Retirement - - 2,755,000-2,755,000 Interest and Fiscal Charges - - 3,023,210-3,023,210 Bond Issuance Costs ,600-74,600 Total Expenditures 65,770,933 43,404,753 5,852, , ,794,470 Excess (Deficiency) of Revenues Over (Under) Expenditures 3,283,135 (33,013,671) (84,213) 328,966 (29,485,783) Other Financing Sources: Proceeds from Sale of Capital Assets 12, , ,258 Issuance of Refunding Bonds - - 9,880,000-9,880,000 Payment to Refunded Bond Escrow Agent - - (9,804,735) - (9,804,735) Total Other Financing Sources 12, ,019 75,265-1,000,523 Net Change in Fund Balances 3,295,374 (32,100,652) (8,948) 328,966 (28,485,260) Fund Balance at Beginning of Year 71,916,595 79,719, , , ,487,380 Fund Balance at End of Year $ 75,211,969 $ 47,619,061 $ 962,227 $ 1,208,863 $ 125,002,120 See accompanying notes to the basic financial statements 20

91 COLUMBUS METROPOLITAN LIBRARY Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities Governmental Funds For the Year Ended December 31, 2016 Net Change in Fund Balances - Total Governmental Funds $ (28,485,260) Amounts reported for governmental activities in the Statement of Activities are different because: Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of those assets is allocated over their estimated useful lives as depreciation expense. Capital Outlays 43,252,659 Depreciation Expense (2,047,669) The effect of various miscellaneous transactions involving capital assets (i.e. sales, trade-ins, and disposals) is to decrease net position. (1,584,613) Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. 132,999 Contractually required contributions are reported as expenditures in governmental funds; however, the statement of net position reports these amounts as deferred outflows. 3,535,762 Except for amounts reported as deferred inflows/outflows, changes in the net pension asset and liability are reported as pension expense in the statement of activities. (5,263,386) The issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current finanical resources of governmental funds. Neither transaction, however, has any effect on net position. Issuance of Debt (9,880,000) Refunded Debt 9,804,735 Principal Payments on Debt 2,755,000 Some expenses reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. Compensated Absences 168,075 Accrued Interest 23,938 Amortization of Deferred Amount on Refunding and Bond Premium 215,746 The internal service fund used by management to charge the costs of insurance to individual funds is not reported in the government-wide statement of activities. Governmental fund expenditures and the related internal service fund revenues are eliminated. The net revenue (expense) of the internal service fund is allocated among the governmental activities. (1,275,974) Change in Position of Governmental Activities $ 11,352,012 See accompanying notes to the basic financial statements 21

92 COLUMBUS METROPOLITAN LIBRARY Statement of Revenues, Expenditures and Changes in Fund Balances Budget (Non-GAAP Basis) and Actual General Fund For the Year Ended December 31, 2016 Original Final Variance Budget Budget Actual (Over)/Under Revenues Property Taxes $ 44,728,000 $ 44,728,000 $ 46,034,928 $ 1,306,928 Intergovernmental 21,145,812 21,145,812 20,226,171 (919,641) Fines and Fees 550, , ,656 (1,344) Investment Earnings 525, , , ,313 Charges for Services 691, , ,083 (20,917) Contributions and Donations 1,000 1,000 50,075 49,075 Miscellaneous 284, , ,909 (125,091) Total Revenues 67,924,812 67,924,812 68,537, ,323 Expenditures Current: Public Service 43,654,936 44,131,571 39,510,868 4,620,703 Administrative and Support 29,177,791 27,852,851 26,328,479 1,524,372 Capital Outlay 2,309,158 3,014,833 2,456, ,241 Total Expenditures 75,141,885 74,999,255 68,295,939 6,703,316 Excess of Revenues Over (Under) Expenditures (7,217,073) (7,074,443) 241,196 7,315,639 Other Financing Sources (Uses) Proceeds from Sale of Capital Assets 25,000 25,000 12,239 (12,761) Transfers In 1,490,000 1,490,000 1,490,000 - Transfers Out (1,490,000) (1,490,000) (1,490,000) - Total Other Financing Sources (Uses) 25,000 25,000 12,239 (12,761) Net Change in Fund Balance (7,192,073) (7,049,443) 253,435 7,302,878 Fund Balances at Beginning of Year 65,575,676 65,575,676 65,575,676 - Prior Year Encumbrances Appropriated 4,719,536 4,719,536 4,719,536 - Fund Balances at End of Year $ 63,103,139 $ 63,245,769 $ 70,548,647 $ 7,302,878 See accompanying notes to the basic financial statements 22

93 COLUMBUS METROPOLITAN LIBRARY Statement of Net Position Proprietary Fund December 31, 2016 Governmental Activities Internal Service Fund Assets Current Assets: Equity in Pooled Cash and Investments $ 2,401,305 Total Current Assets 2,401,305 Liabilities Current Liabilities: Accounts Payable 727 Claims Payable 385,000 Total Current Liabilities 385,727 Net Position Unrestricted 2,015,578 Total Net Position $ 2,015,578 See accompanying notes to the basic financial statements 23

94 COLUMBUS METROPOLITAN LIBRARY Statement of Revenues, Expenses and Changes in Net Position Proprietary Fund For the Year Ended December 31, 2016 Governmental Activities Internal Service Fund Operating Revenues Charges for Services $ 3,649,954 Miscellaneous 65,885 Total Operating Revenues 3,715,839 Operating Expenses Contractual Services 872,564 Claims Paid 4,148,199 Total Operating Expenses 5,020,763 Operating Loss (1,304,924) Nonoperating Revenues Interest Revenue 28,950 Total Non-Operating Revenues 28,950 Change in Net Position (1,275,974) Net Position at Beginning of Year 3,291,552 Net Position at End of Year $ 2,015,578 See accompanying notes to the basic financial statements 24

95 COLUMBUS METROPOLITAN LIBRARY Statement of Cash Flows Proprietary Fund For the Year Ended December 31, 2016 Governmental Activities Internal Service Fund Cash Flows from Operating Activities Cash Received for Claims $ 3,776,784 Cash Received from Reimbursements 120,256 Cash Payments for Administrative Fees (1,005,427) Cash Payments for Claims (4,139,199) Net Cash Flows from Operating Activities (1,247,586) Cash Flows from Investing Activities Cash received from interest 28,950 Net Cash Flows from Investing Activities 28,950 Net Change in Cash (1,218,636) Cash and Cash Equivalents at Beginning of Year 3,619,941 Cash and Cash Equivalents at End of Year $ 2,401,305 Reconciliation of Operating Income to Net Cash Flows from Operating Activities: Operating Loss $ (1,304,924) (Increase)/Decrease in Current Assets Accounts Receivable 56,966 Increase/(Decrease) in Current Liabilities Accounts Payable (8,628) Claims Payable 9,000 Net Cash Flows from Operating Activities $ (1,247,586) See accompanying notes to the basic financial statements 25

96 COLUMBUS METROPOLITAN LIBRARY Statement of Fiduciary Assets and Liabilities December 31, 2016 Digital Downloads Collaboration Agency Fund Assets Equity in Pooled Cash and Investments $ 303,242 Total Assets 303,242 Liabilities Accounts Payable and Other Liabilities 303,242 Total Liabilities $ 303,242 See accompanying notes to the basic financial statements 26

97 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Columbus Metropolitan Library (CML) was founded in CML is a county district library established in accordance with Section of the Ohio Revised Code. CML, which is a separate legal entity, is financially, managerially and operationally independent from both Franklin County and the City of Columbus. CML lends books, periodicals, audiovisual materials, and provides access to technology to residents and certain others at no charge. With its Main Library and 22 branches, CML is well known for signature services and programs like Homework Help Centers, Reading Buddies, Summer Reading Club and the Ready to Read Corps. CML s Strategic Plan supports the vision of a thriving community where wisdom prevails, which positions CML to respond to areas of urgent need: kids unprepared for kindergarten, third grade reading proficiency, high school graduation, college readiness and employment resources. The accompanying financial statements comply with the provisions of Governmental Accounting Standards Board (GASB) Statement No. 14, The Financial Reporting Entity, GASB Statement No. 39, Determining Whether Certain Organizations are Component Units an amendment to GASB Statement No. 14, and GASB Statement No. 61, The Financial Reporting Entity: Omnibus an amendment of GASB Statements No. 14 and No. 34 in that the financial statements include all the materially significant organizations, activities, functions and component units. CML has one component unit, the Columbus Metropolitan Library Foundation (Foundation), which is discretely presented in a separate column in the government-wide financial statements to emphasize that it is legally separate from CML. The Foundation was established in 1990 as a 501(c)(3) charitable organization to receive, hold, invest and administer donations, and to make expenditures to or for the exclusive benefit of CML. Although CML is not financially accountable for the Foundation, the nature and significance of the Foundation s relationship with CML are such that CML s financial statements would be misleading without it. The accounting policies and financial reporting practices of CML conform to accounting principles generally accepted in the United States of America (GAAP) as applicable to governmental units. The following is a summary of its significant accounting policies: (a) Government-wide and fund financial statements The financial information of CML is presented in this report as follows: Management s Discussion and Analysis introduces the basic financial statements and provides an analytical overview of CML s financial activities and overall financial position. Government-wide financial statements consist of a Statement of Net Position and a Statement of Activities. These statements report all of the assets, deferred outflows of resources, liabilities, deferred inflows of resources, revenue, expenses and gains and losses of CML. Governmental activities are reported separately from business-type activities. Governmental activities are normally supported by taxes and intergovernmental revenue whereas business-type activities are normally supported by fees and charges for services and are usually intended by management to be financially self-sustaining. Fiduciary funds are not included in these government-wide financial statements. 27

98 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Internal service fund balances, whether positive or negative, have been eliminated against the expenses and program revenue shown in the governmental activities Statement of Activities. The activities of the internal service fund are eliminated to avoid doubling up revenue and expenses which is consistent with CML policy for such activity. Interfund services provided and used are not eliminated in the process of consolidation. The Statement of Activities presents a comparison between the direct expenses and program revenue for each function of CML s governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Program revenue includes (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenue that is not classified as program revenue, including all taxes, is presented as general revenue. Fund financial statements consist of a series of statements focusing on information about CML s major governmental funds. Separate financial statements are presented for the governmental and proprietary funds. CML s major funds are the General Fund, the Capital Projects Fund, and the Debt Service Fund. The General Fund is the accounting entity in which all governmental activity, except that which is required to be accounted for in other funds, is accounted for. Its revenue consists primarily of taxes, intergovernmental shared revenue, fines and fees, charges for services, investment income and others. General Fund expenditures represent costs of public services, administration and support, and capital outlay. The Capital Projects Fund is used to account for financial resources set aside for the acquisition or the construction of major capital facilities and equipment. The revenue for this fund is derived from transfers from the General Fund, proceeds from the sale of debt, the sale of real property, donations, and other miscellaneous receipts. The Debt Service Fund is used to account for the accumulation of resources for and payment of debt principal, interest and related expenditures. Revenue consists of a portion of CML s Public Library Fund (PLF) receipts. Notes to the financial statements providing information that is essential to the user s understanding of the basic financial statements. Additional required supplementary information containing pension trend data. (b) Financial reporting presentation The accounts of CML are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, deferred outflows of resources, liabilities, deferred inflows of resources, fund balance, revenue, and expenditures (expenses). Fund types are as follows: 28

99 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) GOVERNMENTAL FUNDS Governmental funds are those through which most governmental functions typically are financed. Governmental fund reporting focuses on the sources, uses, and balances of current financial resources. Expendable assets are assigned to the various governmental funds according to the purposes for which they may or must be used. Current liabilities are assigned to the fund from which they will be paid. The difference between governmental fund assets and liabilities is reported as fund balance. The following are CML's governmental funds: General Fund (Major Fund) - The General Fund is the general operating fund of CML. It is used to account for all financial resources except those required to be accounted for in another fund. The fund balance of the general fund is available to CML for any purpose provided it is expended or transferred according to the laws of Ohio. The General Fund is comprised of multiple accounts that are reported in one fund. Capital Project Fund (Major Fund) - Capital Project Funds are used to account for financial resources to be used for the acquisition of major capital assets or the construction of major capital facilities (other than those financed by proprietary funds and trust funds) or capital equipment. The Capital Projects Fund is comprised of multiple individual projects that are reported in one fund. Debt Service Fund (Major Fund) - Debt Service Funds are used to account for the accumulation of resources for and payment of long-term debt principal, interest, and related costs. Other Governmental Funds - Other governmental funds of CML are used to account for land development operations, restricted donations, grants, and any other resources which are restricted for a particular purpose. PROPRIETARY FUNDS Proprietary Funds are those which focus on the determination of operating income, changes in net position, financial position and cash flows. The following is CML's proprietary fund: Internal Service Fund - The Internal Service Fund is used to account for the financing of services provided by one department to another department on a cost reimbursement basis. CML s internal service fund reports on the self-insurance health care program. FIDUCIARY FUNDS Fiduciary Funds are those which report assets held in a trustee or agency capacity for other governments and therefore cannot be used to support CML s programs or operations. The following is CML s fiduciary fund: Agency Fund - The Agency Fund is used to account for assets held on behalf of other libraries and the liabilities associated with the use of assets. CML s agency fund is used to report the assets held in a custodial manner to administer a collaboration of fifteen (15) library systems to acquire and share digital content with their customers. 29

100 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (c) Measurement focus and basis of accounting Except for budgetary purposes, the basis of accounting used by CML conform to GAAP as applicable to governmental units. The accounting and financial reporting treatment is determined by its measurement focus. The government-wide and proprietary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenue is recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which CML gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, grants, shared revenue and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year in which the taxes are levied. On an accrual basis, revenue in the form of shared revenue is recognized when the provider government recognizes its liability to CML. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenue is recognized when measurable and available. CML considers all revenue reported in the governmental funds to be available if the revenue is collected within sixty days after the fiscal year end. Nonexchange transactions, under the modified accrual basis of accounting, are recognized when the amounts are measureable, available and satisfy eligibility requirements. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on long-term debt, claims and judgments and compensated absences, which are recognized as expenditures when payment is due. General capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term debt are reported as other financing sources. The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual amounts could differ from those estimates. (d) Encumbrances Encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is employed in all funds. On the GAAP basis of accounting, encumbrances do not constitute expenditures or liabilities, but are reported as commitments or assignments of fund balances in governmental funds. (e) Cash Equivalents For purposes of the statement of cash flows, the Proprietary Fund considers all highly liquid investments, with purchased maturities of three months or less, to be cash equivalents. (f) Investments During 2016, investments were limited to commercial paper, federal agency securities, money market funds and STAR Ohio. Commercial paper, federal agency securities are reported at fair value which is based on quoted market prices. STAR Ohio and money market funds are reported at the net asset value per share, which approximates fair value. 30

101 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) STAR Ohio is an investment pool managed by the State Treasurer's Office, which allows governments within the State to pool their funds for investment purposes. STAR Ohio is not registered with the Securities Exchange Commission as an investment company, but has adopted Governmental Accounting Standards Board (GASB), Statement No. 79, Certain External Investment Pools and Pool Participants. CML measures their investment in STAR Ohio at the net asset value (NAV) per share provided by STAR Ohio. The NAV per share is calculated on an amortized cost basis that provides a NAV per share that approximates fair value. For the year ended December 31, 2016, there were no limitations on any participant withdrawals due to redemption notice periods, liquidity fees, or redemption gates. (g) Capital Assets Property, plant and equipment are reported in the applicable governmental columns in the governmentwide financial statements. CML does not have any infrastructure assets. CML defines capital assets as assets with a unit cost of more than $5,000. Such assets are recorded at historical cost or estimated historical cost. Donated assets are recorded at estimated fair value at the date of donation. The cost of normal maintenance and repairs that does not add to the value of the asset or materially extend an asset s life are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are completed. Library books and materials purchased by CML are reflected as expenditures when purchased and are not capitalized as assets of CML. CML currently has a library materials collection of approximately 1,900,000 volumes. Property, plant and equipment is depreciated using the straight line method over the following estimated useful lives: Estimated Description Life (years) Buildings 60 Furniture/Artwork/Grounds Equipment 20 Land Development/Machinery & General Equipment 15 Bookmobiles 12 Other Vehicles/Business Machines/Printers/AudioVisual Equipment 10 Security Equipment 7 Computer Equipment & Software/Telecommunications Equipment 5 (h) Insurance CML is insured by private carriers for property damage, personal injury and public official liability. Judgments and claims in excess of policy limits are recorded when it is probable that an asset has been impaired or a liability has been incurred and the amount of loss can be reasonably estimated. At December 31, 2016, 2015, and 2014, there were no outstanding judgments or claims in excess of policy limits. There were no significant changes in insurance coverage from the previous year and no insurance settlement has exceeded insurance coverage during the last three years. CML provides dental, vision, life and disability insurance coverage for employees through private insurance carriers. CML is part of the state-wide plan for Worker's Compensation insurance coverage. Beginning in 2001, CML established self-insured employee health care. To account for and finance its uninsured health claims, CML established the Self-Insurance Fund (an internal service fund). All departments of CML participate in the program and make payments to the Self- Insurance Fund based on actuarial estimates of the amounts needed to pay current and future claims. CML has purchased specific stop loss insurance for claims which exceed $125,000 per covered individual in one year and aggregate stop loss coverage at 125% of annual estimated claims. 31

102 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Unpaid Claims Jan. 1 $ 331,000 $ 339,000 $ 376,000 Incurred Claims 3,482,847 3,662,853 4,148,199 Payment of Claims (3,474,847) (3,625,853) (4,139,199) Unpaid Claims Dec. 31 $ 339,000 $ 376,000 $ 385,000 The $385,000 of unpaid claims are reflected in the internal service fund's claims payable line item. (i) Compensated Absences CML employees accumulate one "bank" of hours for both sick and vacation called Paid Time Off (PTO). These hours are vested at 100% when earned up to maximum limits defined by Board Policy. Payment is dependent upon many factors; therefore, timing of future payments was not readily determinable. However, management believes that sufficient resources will be available for the payment of PTO when such payments become due. The total liability for PTO has been calculated using pay rates in effect at the balance sheet date. CML employees are granted PTO in varying amounts, based on scheduled hours and years of service. On governmental fund financial statements, compensated absences are recognized as liabilities and expenditures to the extent payments come due each period upon the occurrence of employee resignations and retirements. Any governmental fund liability reported is for the unpaid balance of reimbursable unused leave for employees that terminated on or before December 31, All liabilities are paid from the general fund. The noncurrent portion of the liability is not reported. The noncurrent portion of the liability is reported on the government-wide financial statements. (j) Debt Issuance Costs, Premiums, Discounts, and Deferred Amounts on Refundings Bond premiums and discounts are capitalized and amortized over the life of the bonds. Deferred amounts on refundings are capitalized and amortized over the life of new bonds or the life of the old bonds, whichever is shorter. Issuance cost is expensed in the year in which debt was issued in accordance with GASB 65, Items Previously Reported as Assets and Liabilities. (k) Interfund Transactions Exchange transactions between funds are reported as revenue 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 of repayment are reported as interfund transfers. Interfund transfers are reported as other financing sources/uses in governmental funds and after non-operating revenue/expenses in the proprietary funds. Repayments from funds responsible for particular expenditures/expenses to the funds that initially paid for them are not presented in the basic financial statements. Interfund transfers between governmental funds are eliminated for reporting on the government- wide financial statements. There were no interfund transfers during the year ended December 31,

103 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (l) Prepaid Items Payments made to vendors for services that will benefit periods beyond December 31, 2016, are recorded as prepaid items. Prepaid items consist primarily of insurance premiums, conferences and training, memberships and library material subscriptions. Prepaid items are accounted for using the consumption approach of accrual accounting that is items are recorded as an asset deferring the recognition of an expenditure until the month in which it should occur. (m) Budgetary Basis of Accounting Budget A budget of estimated cash receipts and disbursements, including encumbrances, is submitted to the County Auditor, as secretary of the County Budget Commission, by July 20 of each year for the fiscal year commencing the following January 1. Estimated Resources The County Budget Commission certifies the budget to CML by September 1. As part of this certification, CML receives the official Certificate of Estimated Resources which states the projected receipts of each fund. On or about January 1, this certificate is amended to include any unencumbered balances from the preceding year. The total estimated receipts together with prior year carryover of unencumbered cash then serves as the basis for the annual appropriation. Expenditures and encumbrances from any fund during the ensuing fiscal year must not exceed the amount stated in the Amended Certificate of Estimated Resources. Appropriations CML is required by state statute to adopt an annual appropriation cash basis budget. A temporary appropriation measure to control cash disbursements is passed by CML s Board of Trustees in December of each year to be effective as of January 1. The permanent appropriation measure then must be passed by April 1 of each year for the period January 1 to December 31. The permanent appropriation measure then may be amended or supplemented during the year as new information becomes available. Appropriations may not exceed estimated resources. Unencumbered appropriations lapse at year-end except in Capital Projects Fund which has continuing appropriations. For all funds, increases or decreases in expenditures requires Board authorization at the total appropriation level. CML budgets annual expenditures for all governmental funds. The budget specifies expenditure amounts by function within these funds. Expenditures cannot exceed total appropriations for all budgeted funds. CML budgets annual expenses for two nongovernmental fund types, the Internal Service Fund and the Digital Downloads Fund. The budget specifies expense amounts by function within the fund. Expenses cannot exceed total appropriations. In addition to the annual expenditures/expenses budgeting described in the preceding paragraphs, all revenue, except for tax revenue, for the General Fund is estimated by the Fiscal Officer in conjunction with the annual budgeting process. However, the annual appropriations should not exceed the estimated resources as certified by the County Budget Commission in the annual Certificate of Estimated Resources. The Board has delegated purchase and expenditure approval to CML administration for daily operational needs of CML. Any appropriation change which will increase or decrease any of the major appropriation classifications requires approval of the Board. Expenditures did not exceed appropriations in any fund type. 33

104 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) CML's budgetary process is based upon accounting for certain transactions on a basis other than GAAP. To provide a meaningful comparison of actual results with the budget, the actual results of operations for governmental funds are presented in the Supplemental Data section of this report. The major differences between the budget basis and the GAAP basis are as follows: Revenue is recorded when received in cash (budget basis) as opposed to when susceptible to accrual (GAAP basis). Expenditures are recorded when paid in cash (budget basis) as opposed to when the liability is incurred (GAAP basis). Encumbrances are recorded as the equivalent of expenditures (budget basis), as opposed to assigned fund balance (GAAP basis). (n) Net Position Net position represents the difference between assets plus deferred outflows of resources and liabilities plus deferred inflows of resources. Net investment in capital assets, consists of capital assets, net of accumulated depreciation, less any outstanding debt and debt-related items. Net position is reported as restricted when there are limitations imposed on their use either through the enabling legislation or through external restrictions imposed by creditors, grantors or laws or regulations of other governments. CML applies restricted resources when an expense is incurred for purposes for which both restricted and unrestricted net position are available. (o) Operating Revenue and Expenses Operating revenue and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund s principal ongoing operation. The principal revenue source of CML s proprietary fund is charges for services. Operating expenses for the proprietary funds include claims and administrative expenses. All revenue and expenses not meeting these definitions are reported as nonoperating revenue and expenses. (p) Fund Balance Fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which CML is bound to honor constraints on the specific purposes for which amounts of the fund can be spent in accordance with GASB 54, Fund Balance Reporting and Governmental Fund Type Definitions. CML considers fund balance non-spendable when it is in a non-spendable form (inventories or prepaids) or when the balance is legally or contractually required to be maintained intact. Restricted fund balance is reported when constraints have been placed on the use of resources externally (grant agreements, legal requirements). Committed fund balance represents amounts committed for a specific use through formal Board resolution. Assigned fund balance are those amounts intended to be used for a specific purpose that do not meet the definition of restricted or committed. The Board has authorized the Chief Financial Officer to assign fund balances as necessary. In governmental funds, other than the general fund, fund balance that is not committed or restricted is assigned. Residual fund balance in the general fund is unassigned. In other governmental funds, only a deficit is reported as unassigned. 34

105 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) CML considers restricted amounts to have been spent when an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available. CML considers committed amounts used first, followed by assigned amounts; unassigned amounts are considered to have been spent when an expenditure is incurred for purposes for which amounts in the committed or assigned fund balance classifications could not be used. CML has established a minimum unassigned fund balance goal of twenty percent of the current fiscal year general fund expenditure budget less capital outlay and transfers out. (q) Deferred Outflows/Inflows of Resources In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. Deferred outflows of resources represent a consumption of net position that applies to a future period and will not be recognized as an outflow of resources (expense/expenditure) until then. For CML, deferred outflows of resources are reported on the government-wide statement of net position for deferred amounts on refundings and pension. A deferred charge on refunding results from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded debt or refunding debt. The deferred outflows of resources related to pension are explained in Note 5. In addition to liabilities, the statement of net position report a separate section for deferred inflows of resources. Deferred inflows of resources represent an acquisition of net position that applies to a future period and will not be recognized as an inflow of resources (revenue) until that time. For CML, deferred inflows of resources include property taxes, pension, and unavailable revenue. Property taxes represent amounts for which there is an enforceable legal claim as of December 31, 2016, but which were levied to finance calendar year 2017 operations. These amounts have been recorded as a deferred inflow on both the government-wide statement of net position and the governmental fund financial statements. Unavailable revenue is reported only on the governmental funds balance sheet, and represents receivables which will not be collected within the available period. For CML, unavailable revenue includes delinquent property taxes, intergovernmental revenue, and interest income. These amounts are deferred and recognized as an inflow of resources in the period the amounts become available. Deferred inflows of resources related to pension are reported on the government-wide statement of net position. (See Note 5) (r) Pensions For purposes of measuring the net pension asset, 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 pension plans and additions to/deductions from their fiduciary net positon have been determined on the same basis as they are reported by the pension systems. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. The pension system reports investments at fair value. 35

106 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 2 CASH AND INVESTMENTS CML pools all individual fund cash balances for investment purposes, except for cash with fiscal agents, restricted investments and debt proceeds. Interest earned on debt proceeds will be credited to CML s Capital Projects Fund. All other interest earned will be allocated to the General Fund, Capital Projects Fund, Land Development Fund, Permanent Fund and Self-Insurance Fund based on the monthly average daily balance of the fund. Credit risk is the risk of loss due to the failure of a security issuer to pay principal or interest, or the failure of the issuer to make timely payments of principal or interest. Eligible investments, pursuant to Ohio Revised Code Section , affected by credit risk include certificates of deposit, commercial paper and bankers acceptances. Per CML s investment policy, credit risk is minimized by (1) diversifying assets by issuer; (2) ensuring that required, minimum credit quality ratings exist prior to the purchase of commercial paper and bankers acceptances; and (3) maintaining adequate collateralization of deposits and certificates of deposit, pursuant to the method as determined by the Fiscal Officer. CML s Investment Policy addresses custodial risk in accordance with Ohio Revised Code , which states collateral so pledged or deposited may be in an amount that when added to the portion of the deposit insured by the federal deposit insurance corporation will, in the aggregate, equal or exceed the amount of public moneys so deposited Deposits: At December 31, 2016, the carrying amount of all CML's deposits was $6,319,288, including $1,093,154 in STAR Plus, and the bank balance was $5,936,464. Of the bank balance, $1,343,154 was covered by Federal Deposit Insurance and $4,593,310 was uninsured and collateralized with securities held by the financial institution or by its trust department or agent but not in CML's name. STAR Plus is a cash management program that provides Ohio political subdivisions with access to hundreds of FDIC insured banks via one convenient account. STAR Plus accounts have no exposure to credit or market risk. All deposits have full FDIC insurance and are backed by the full faith and credit of the U.S. Government. Investments: CML adopted a formal investment policy. The objectives of the policy shall be the preservation of capital and protection of principal while earning investment interest. Safety of principal is the primary objective of the investment program. This policy covers all funds under the direct control of the Fiscal Officer. Funds are invested in accordance with Section 135 "Uniform Depository Act" of the Ohio Revised Code as revised by Senate Bill 81. The types of obligations eligible for investment and deposits are: 1. U.S. Treasury Bills, Notes and Bonds; various federal agency securities, including issues of Federal National Mortgage Assn. (FNMA), Federal Home Loan Mortgage Corp. (FHLMC), Federal Home Loan Bank (FHLB), Federal Farm Credit Bank (FFCB), Government National Mortgage Association (GNMA), and other agencies or instrumentalities of the United States. Eligible investments include securities that may be called (by the issuer) prior to final maturity date. All eligible investments may be purchased at a premium or a discount. All federal agency securities shall be direct issuances of federal government agencies or instrumentalities. 2. Commercial paper notes issued by companies incorporated under the laws of the United States; specific limitations apply as defined under Ohio Revised Code Section (B)(7). 36

107 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 2 CASH AND INVESTMENTS (continued) 3. Bankers acceptances issued by any domestic bank rated in the highest category by a nationally recognized rating agency; specific limitations apply as defined under Ohio Revised Code Section (B)(7). 4. Bonds and other obligations of the State of Ohio or the political subdivisions of the State of Ohio as defined by ORC Section (B)(4). 5. Certificates of deposit from any eligible institution mentioned in Ohio Revised Code Section No-load money market mutual funds rated in the highest category by at least one nationally recognized rating agency, investing exclusively in the same types of eligible securities as defined in Ohio Revised Code Sections (B)(1) and (B)(2) and repurchase agreements secured by such obligations, provided that investments in such securities are made only through eligible institutions mentioned in Ohio Revised Code Section , regarding limitations and restrictions. 7. Repurchase agreements with any eligible institutions mentioned in Ohio Revised Code Section 135 and particularly Section (E) therein. Repurchase agreements will settle on a delivery versus payment basis with collateral held in safekeeping by a custodian as agreed to by the Fiscal Officer. The market value of securities subject to a repurchase agreement must exceed the principal value of the repurchase agreement by at least two percent as defined under the Ohio Revised Code. The Fiscal Officer reserves the right to require an additional percentage of collateral securing such repurchase agreements. 8. The state treasurer s investment programs (STAR Ohio & STAR Plus), pursuant to Ohio Revised Code Section Investments of CML funds are prohibited or restricted as follows: 1. The use of derivative securities, as defined by Ohio Revised Code Section , is expressly prohibited. 2. The final maturity of all eligible investments is five years, unless the investment is matched to a specific obligation or debt of CML, and the investment is specifically approved by the Board of Trustees. 3. A repurchase agreement under the terms of which the investing authority agrees to sell securities to a purchaser and agrees with that purchaser to unconditionally repurchase those securities. 4. The investment into a fund established by another subdivision if the fund was established for the purpose of investing monies of other subdivisions. 5. The use of leverage, in which CML uses its current investment assets as collateral for the purpose of purchasing other assets. 6. The issuance of taxable notes for the purpose of arbitrage. 7. Contracting to sell securities that have not yet been acquired, for the purpose of purchasing such securities on the speculation that bond prices will decline. 37

108 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 2 CASH AND INVESTMENTS (continued) Cash and investments at year-end were as follows: Credit Maturity in Years Amount Rating less than STAR Ohio (State Treasurer's Asset Reserve Program) $ 14,264,377 AAAm 1 $ 14,264,377 $ - $ - US Treasury Securities 3,469,979 AA ,984 2,470,995 - Federal Agency Securities (Noncallable) 63,425,081 AA+ 1 11,480,750 42,505,081 9,439,250 Federal Agency Securities (Callable) 27,681,781 AA+ 1-14,857, ,824,010 2 Commercial Paper 10,048,663 A1 1 10,048, Money Market Fund 1,868,739 AAAm 1 1,868, Carrying Amount of Deposits 6,319,288 6,319, Change Funds and Imprest Balance 194, , Total $ 127,272,360 $ 45,175,253 $ 59,833,847 $ 22,263,260 Less: Cash and investments - Agency Fund (303,242) Total Governmental Funds Cash 126,969,118 Per Statement of Net Position: Cash and Investments $ 109,009,755 Cash Equivalents - Restricted 17,474,937 Cash with Trustee 484,426 Total $ 126,969, Standard & Poors. 2 - The entire balance is callable within 1 year. CML measures their investment in STAR Ohio at the net asset value (NAV) per share provided by STAR Ohio. The NAV per share is calculated on an amortized cost basis that provides a NAV per share that approximates fair value. CML measures all other investments at fair value. CML categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. At December 31, 2016, CML had the following Level 2 investments: U.S. Treasury Securities totaling $3,469,979, Federal Agency Securities totaling $91,106,862, and Commercial Paper totaling $10,048,663. Restricted assets of $17,474,937 represent the endowment principal of the restricted fund and unspent note proceeds. 38

109 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 3 DONOR RESTRICTED ENDOWMENTS CML s Permanent Fund includes donor-restricted endowments. Non-Spendable Fund Balance includes the $67,742 non-spendable portion of the endowment, the $1,011 that is available for expenditure is restricted to comply with donors original intent. CML Board of Trustees is permitted to appropriate, for purposes consistent with the endowment s intent, net appreciation, realized and unrealized, unless the endowment terms state otherwise. NOTE 4 CAPITAL ASSETS A summary of changes in capital assets for the year ended December 31, 2016, follows: Balance Balance Jan 1, 2016 Additions Deletions Transfers Dec 31, 2016 Nondepreciable Assets: Land $ 12,842,451 $ 965,212 $ (153,959) $ - $ 13,653,704 Construction in Progress 25,981,977 41,022,360 - (54,759,128) 12,245,209 Depreciable Assets: Buildings & Improvements 94,387,274 1,084,330 (2,503,971) 54,759, ,726,761 Machinery & Equipment 5,079, ,757 (1,770,731) - 3,489,393 Total Capital Assets $ 138,291,069 $ 43,252,659 $ (4,428,661) $ - $ 177,115,067 Accumulated Depreciation: Buildings & Improvements (30,895,259) (1,937,438) 1,109,612 - (31,723,085) Machinery & Equipment (4,304,703) (110,231) 1,734,436 - (2,680,498) Total Accumulated Depreciation $ (35,199,962) $ (2,047,669) $ 2,844,048 $ - $ (34,403,583) Total Capital Assets, net $ 103,091,107 $ 41,204,990 $ (1,584,613) $ - $ 142,711,484 Projects were funded through the Capital Projects Fund by monies transferred from the General Fund and proceeds from the sale of debt. The balance of these Capital projects will be funded by available financial resources. Of the $2,047,669 depreciation expense, $1,230,886 was related to Public Service and $816,783 was related to Administrative and Support. NOTE 5 DEFINED BENEFIT PENSION PLANS Net Pension Asset/Liability The net pension asset and net pension liability reported on the Statement of Net Position represent an asset/liability to employees for pensions. Pensions are a component of exchange transactions- between an employer and its employees of salaries and benefits for employee services. Pensions are provided to an employee on a deferred-payment basis as part of the total compensation package offered by an employer for employee services each financial period. The obligation to sacrifice resources for pensions is a present obligation because it was created as a result of employment exchanges that already have occurred. 39

110 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 5 DEFINED BENEFIT PENSION PLANS (Continued) The net pension asset and net pension liability represent CML s proportionate share of each pension plan s collective actuarial present value of projected benefit payments attributable to past periods of service, net of each pension plan s fiduciary net position. The net pension asset/liability calculation is dependent on critical long-term variables, including estimated average life expectancies, earnings on investments, cost of living adjustments and others. While these estimates use the best information available, unknowable future events require adjusting this estimate annually. Ohio Revised Code limits CML s rights to/obligation for this asset/liability to annually required payments. CML cannot control benefit terms or the manner in which pensions are financed; however, CML does receive the benefit of employees services in exchange for compensation including pension. GASB Statement No. 68 assumes the net pension asset solely belongs to the employer and the net pension liability is solely the obligation of the employer, because (1) they benefit from employee services; and (2) State statute requires all funding to come from these employers. All contributions to date have come solely from these employers (which also includes costs paid in the form of withholdings from employees). State statute requires the pension plans to amortize overfunded assets and unfunded liabilities within 30 years. If the amortization period exceeds 30 years, each pension plan s board must propose corrective action to the State legislature. Any resulting legislative change to benefits or funding could significantly affect the net pension asset/liability. Resulting adjustments to the net pension asset/liability would be effective when the changes are legally enforceable. The proportionate share of each plan s over/under funded benefits is presented as a long-term net pension asset or long-term net pension liability on the accrual basis of accounting. Any liability for the contractuallyrequired pension contribution outstanding at the end of the year is included in intergovernmental payable on both the accrual and modified accrual bases of accounting. Plan Description Ohio Public Employees Retirement System (OPERS) Plan Description - CML employees participate in the Ohio Public Employees Retirement System (OPERS). OPERS administers three separate pension plans. The traditional pension plan is a cost-sharing, multipleemployer defined benefit pension plan. The member-directed plan is a defined contribution plan and the combined plan is a cost-sharing, multiple-employer defined benefit pension plan with defined contribution features. OPERS provides retirement, disability, survivor and death benefits, and annual cost of living adjustments to members of the traditional and combined plans. Authority to establish and amend benefits is provided by Chapter 145 of the Ohio Revised Code. OPERS issues a stand-alone financial report that includes financial statements, required supplementary information and detailed information about OPERS fiduciary net position that may be obtained by visiting by writing to the Ohio Public Employees Retirement System, 277 East Town Street, Columbus, Ohio , or by calling Senate Bill (SB) 343 was enacted into law with an effective date of January 7, In the legislation, members were categorized into three groups with varying provisions of the law applicable to each group. The following table provides age and service requirements for retirement and the retirement formula applied to final average salary (FAS) for the three member groups as per the reduced benefits adopted by SB 343 (see OPERS financial report referenced above for additional information): 40

111 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 5 DEFINED BENEFIT PENSION PLANS (Continued) Group A Group B Group C Eligible to retire prior to 20 years of service credit prior to Members not in other Groups January 7, 2013 or five years January 7, 2013 or eligible to retire and members hired on or after after January 7, 2013 ten years after January 7, 2013 January 7, 2013 State and Local State and Local State and Local Age and Service Requirements: Age and Service Requirements: Age and Service Requirements: Age 60 w ith 60 months of service credit Age 60 w ith 60 months of service credit Age 57 w ith 25 years of service credit or Age 55 w ith 25 years of service credit or Age 55 w ith 25 years of service credit or Age 62 w ith 5 years of service credit Traditional Plan Formula: Traditional Plan Formula: Traditional Plan Formula: 2.2% of FAS multiplied by years of 2.2% of FAS multiplied by years of 2.2% of FAS multiplied by years of service for the first 30 years and 2.5% service for the first 30 years and 2.5% service for the first 35 years and 2.5% for service years in excess of 30 for service years in excess of 30 for service years in excess of 35 Combined Plan Formula: Combined Plan Formula: Combined Plan Formula: 1.0% of FAS multiplied by years of 1.0% of FAS multiplied by years of 1.0% of FAS multiplied by years of service for the first 30 years and 1.25% service for the first 30 years and 1.25% service for the first 35 years and 1.25% for service years in excess of 30 for service years in excess of 30 for service years in excess of 35 Final average Salary (FAS) represents the average of the three highest years of earnings over a member s career for Groups A and B. Group C is based on the average of the five highest years of earnings over a member s career. Members who retire before meeting the age and years of service credit requirement for unreduced benefits receive a percentage reduction in the benefit amount. When a benefit recipient has received benefits for 12 months, an annual cost of living adjustment (COLA) is provided. For members retiring under the Combined Plan, an annual COLA will be provided on the defined benefit portion of their benefit. This COLA is calculated on the base retirement benefit at the date of retirement and is not compounded. For those retiring prior to January 7, 2013, the COLA will continue to be a 3 percent simple annual COLA. For those retiring subsequent to January 7, 2013, beginning in calendar year 2019, the COLA will be based on the average percentage increase in the Consumer Price Index, capped at 3 percent. Funding Policy - The Ohio Revised Code (ORC) provides statutory authority for member and employer contributions as follows: State and Local 2016 Statutory Maximum Contribution Rates Employer 14.0 % Employee 10.0 % 2016 Actual Contribution Rates Employer: Pension 12.0 % Post-employment Health Care Benefits 2.0 Total Employer 14.0 % Employee 10.0 % 41

112 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 5 DEFINED BENEFIT PENSION PLANS (Continued) Employer contribution rates are actuarially determined and are expressed as a percentage of covered payroll. CML s contractually required contribution was $3,535,762 for Of this amount, $408,191 is reported as an intergovernmental payable. Pension Assets, Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions The net pension asset and net pension liability for OPERS was measured as of December 31, 2015, the date of OPERS most recent report, and the total pension asset/liability used to calculate the net pension asset/liability was determined by an actuarial valuation as of that date. CML's proportion of the net pension asset/liability was based on CML's share of contributions to the pension plan relative to the contributions of all participating entities. Following is information related to the proportionate share and pension expense: OPERS OPERS Traditional Plan Combined Plan Total Proportionate Share of the Net Pension Liability/(Asset) $36,103,396 ($122,249) $35,981,147 Proportion of the Net Pension Liability/(Asset) % % Pension Expense $5,101,800 $161,586 $5,263,386 At December 31, 2016, CML reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: OPERS OPERS Traditional Plan Combined Plan Total Deferred Outflows of Resources Net difference between projected and actual earnings on pension plan investments $10,612,144 $52,782 $10,664,926 CML contributions subsequent to the measurement date 3,415, ,365 3,535,762 Total Deferred Outflows of Resources $14,027,541 $173,147 $14,200,688 Deferred Inflows of Resources Differences between expected and actual experience $697,586 $55,784 $753,370 Change in proportionate share 157,324 7, ,471 Total Deferred Inflows of Resources $854,910 $62,931 $917,841 $3,535,762 reported as deferred outflows of resources related to pension resulting from CML contributions subsequent to the measurement date will be recognized as pension expense in the year ending December 31, Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pension will be recognized in pension expense as follows: 42

113 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 5 DEFINED BENEFIT PENSION PLANS (Continued) Year Ending December 31: OPERS OPERS Traditional Plan Combined Plan Total 2017 $2,248,387 $5,663 $2,254, ,418,076 5,663 2,423, ,701,233 5,663 2,706, ,389,538 4,185 2,393, (7,902) (7,902) Thereafter - (23,421) (23,421) Total $9,757,234 ($10,149) $9,747,085 Actuarial Assumptions - OPERS Actuarial valuations of an ongoing plan involve estimates of the values of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and cost trends. Actuarially determined amounts are subject to continual review or modification as actual results are compared with past expectations and new estimates are made about the future. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employers and plan members) and include the types of benefits provided at the time of each valuation. The total pension liability in the December 31, 2015, actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement: Traditional Plan Combined Plan Wage Inflation 3.75 percent 3.75 percent Future Salary Increases, including inflation 4.25 to percent including wage inflation 4.25 to 8.05 percent including wage inflation COLA or Ad Hoc COLA 3 percent, simple 3 percent, simple Investment Rate of Return 8 percent 8 percent Actuarial Cost Method Individual Entry Age Individual Entry Age Mortality rates were based on the RP-2000 Mortality Table projected 20 years using Projection Scale AA. For males, 105 percent of the combined healthy male mortality rates were used. For females, 100 percent of the combined healthy female mortality rates were used. The mortality rates used in evaluating disability allowances were based on the RP-2000 mortality table with no projections. For males 120 percent of the disabled female mortality rates were used set forward two years. For females, 100 percent of the disabled female mortality rates were used. The most recent experience study was completed for the five-year period ended December 31, The long-term rate of return on defined benefit investment assets was determined using a building-block method in which best-estimate ranges of expected future real rates of return are developed for each major asset class. These ranges are combined to produce the long-term expected real rate of return by weighting the expected future real rates of return by the target asset allocation percentage, adjusted for inflation. 43

114 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 5 DEFINED BENEFIT PENSION PLANS (Continued) OPERS manages investments in four investment portfolios: the Defined Benefits portfolio, the Health Care portfolio, the 115 Health Care Trust portfolio and the Defined Contribution portfolio. The Defined Benefit portfolio includes the investment assets of the Traditional Pension Plan, the defined benefit component of the Combined Plan, the annuitized accounts of the Member-Directed Plan and the VEBA Trust. Within the Defined Benefit portfolio, contributions into the plans are all recorded at the same time, and benefit payments all occur on the first of the month. Accordingly, the money-weighted rate of return is considered to be the same for all plans within the portfolio. The money weighted rate of return, net of investments expense, for the Defined Benefit portfolio is 0.40 percent for The allocation of investment assets with the Defined Benefit portfolio is approved by the OPERS Board of Trustees as outlined in the annual investment plan. Plan assets are managed on a total return basis with a long-term objective of achieving and maintaining a fully funded status for the benefits provided through the defined benefit pension plans. The table below displays the Board-approved asset allocation policy for 2015 and the long-term expected real rates of return: Discount Rate Asset Class Target Allocation Weighted Average Long-Term Expected Real Rate of Return (Arithmetic) Fixed Income % 2.31 % Domestic Equities Real Estate Private Equity International Equities Other investments Total % 5.27 % The discount rate used to measure the total pension asset/liability was 8%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members and those of the contributing employers are made at the statutorily required rates. Based on those assumptions, the pension plan s fiduciary net position was projected to be available to make all projected future benefits payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of CML s Proportionate Share of the Net Pension Asset and Net Pension Liability to Changes in the Discount Rate The following table presents CML s proportionate share of the net pension asset/liability calculated using the current period discount rate assumption of 8%, as well as what CML s proportionate share of the net pension asset/liability would be if it were calculated using a discount rate that is one-percentage-point lower (7%) or one-percentage-point higher (9%) than the current rate: 44

115 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 5 DEFINED BENEFIT PENSION PLANS (Continued) Current 1% Decrease Discount Rate 1% Increase (7.00%) (8.00%) (9.00%) CML's proportionate share of the net pension liability/(asset) Traditional Plan $57,521,531 $36,103,396 $18,037,878 Combined Plan ($2,512) ($122,249) ($218,561) NOTE 6 OTHER POST-EMPLOYMENT BENEFITS Plan Description Ohio Public Employees Retirement System (OPERS) administers three separate pension plans: The Traditional Pension Plan a cost-sharing, multiple-employer defined benefit pension plan; the Member-Directed Plan a defined contribution plan; and the Combined Plan a cost-sharing, multiple-employer defined benefit pension plan that has elements of both a defined benefit and defined contribution plan. In March 2016, OPERS received two favorable rulings from the Internal Revenue Service (IRS) allowing OPERS to consolidate all health care assets into the OPERS 115 Health Care Trust. Transition to the new health care trust structure was completed July 1, As of December 31, 2016, OPERS maintains a cost-sharing, multiple-employer defined benefit post-employment health care trust, which funds multiple health care plans including medical coverage, prescription drug coverage and deposits to a Health Reimbursement Arrangement to qualifying benefit recipients of both the Traditional Pension and the Combined plans. Members of the Member-Directed Plan do not qualify for ancillary benefits, including OPERS sponsored health care coverage. OPERS funds a Retiree Medical Account (RMA) for participants can be reimbursed for qualified medical expenses from their vested RMA balance. In order to qualify for health care coverage, age-and-service retirees under the Traditional Pension and Combined plans must have 20 or more years of qualifying Ohio service credit. Health care coverage for disability benefit recipients and qualified survivor benefit recipients is available. The health care coverage provided by OPERS meets the definition of an Other Post Employment Benefit (OPEB) as described in GASB Statement 45. Please see the Plan Statement in the OPERS 2015 CAFR for details. The Ohio Revised Code permits, but does not require, OPERS to provide health care to its eligible benefit recipients. Authority to establish and amend health care coverage is provided to the Board in Chapter 145 of the Ohio Revised Code. OPERS issues a stand-alone financial report. Interested parties may obtain a copy by visiting by writing to OPERS, 277 East Town Street, Columbus, OH , or by calling or Funding Policy The Ohio Revised Code provides the statutory authority requiring public employers to fund health care through their contributions to OPERS. A portion of each employer s contribution to OPERS is set aside to fund OPERS health care plans. Employer contribution rates are expressed as a percentage of the earnable salary of active members. In 2016, CML contributed at a rate of 14.0% of earnable salary. This is the maximum employer contribution rate permitted by the Ohio Revised Code. Active member contributions do not fund health care. 45

116 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 6 OTHER POST-EMPLOYMENT BENEFITS (Continued) Each year, the OPERS Board of Trustees determines the portion of the employer contribution rate that will be set aside to fund health care plans. The portion of employer contributions allocated to health care for members of the Traditional Pension Plan and Combined Plan was 2.0% during calendar year As recommended by OPERS actuary, the portion of employer contributions allocated to health care beginning January 1, 2017 decreased to 1.0% for both plans. The board is also authorized to establish rules for the retiree or their surviving beneficiaries to pay a portion of the health care provided. Payment amounts vary depending on the number of covered dependents and the coverage selected. The employer contribution as a percentage of covered payroll deposited to the VEBA for participants in the Member-Directed Plan for 2016 was 4.0%. CML s contributions to OPERS to fund post-employment benefits for the years ended December 31, 2016, 2015, and 2014 were $589,294, $572,313, and $562,890, respectively. The full amount has been contributed for 2015 and % has been contributed for 2016 with the remainder being reported as a fund liability. NOTE 7 PROPERTY TAXES Property taxes include amounts levied against all real and public utility property located in the CML district. Real property taxes and public utility taxes collected during 2016 were levied after October 1 on the assessed value listed as of the prior January 1, the lien date. These taxes are payable annually or semiannually. If paid annually, payment is due by January 20; if paid semi-annually, the first payment is due by January 20 with remainder payable by June 20. Under certain circumstances, state statutes permit earlier or later payment dates to be established. Assessed values are established by State law at 35% of appraised market value. A revaluation of all property is required to be completed no less than every six years. The last revaluation was completed in Public utility property taxes are assessed on tangible personal property, as well as land and improvements, at true value, which is a certain percentage of cost. Percentages vary according to the type of utility involved. The assessed values upon which the 2016 taxes were collected were approximately $18.4 billion. Ohio law prohibits taxation of property from all taxing authorities in excess of 1% of assessed value without a vote of the people. Increases in the property tax rate are restricted only by voter willingness to approve such increases. In 1986, voters approved taxation of property for CML of.22% (2.2 mills) of assessed value effective January 1, 1986, for collection in This levy was to be collected for a period of 15 years and expired after the collection year In November 2000, the voters in Franklin County approved renewing the existing 2.2 levy. The collection year for the new levy began in In November of 2010, the voters in Franklin County approved to replace the existing 2.2 mill levy with a new permanent 2.2 mill levy and an increase of 0.6 mills, the collection year for the replacement levy began January The Franklin County Treasurer collects property taxes on behalf of taxing districts in the county. The Franklin County Auditor periodically remits to CML its portion of the taxes collected. Property taxes with both a lien and levy date prior to fiscal year end are recorded as deferred inflows of resources and receivables. However, property taxes including delinquent property taxes that were measurable at December 31, 2016, and available to CML are recorded as revenue and receivables. 46

117 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 8 NEW PRONOUNCEMENTS In January 2016, GASB issued Statement No. 80, Blending Requirements for Certain Component Units An Amendment of GASB Statement No. 14. This Statement enhances the comparability of financial statements among governments by clarifying the financial statement presentation requirements for certain component units. This requires blending of a component unit incorporated as a not-for-profit corporation in which the primary government is the sole corporate member. The requirements of this statement are effective for financial statements for reporting periods beginning after June 15, CML management is evaluating the effect this standard will have on CML s financial statements. In March 2016, GASB issued Statement No. 81, Irrevocable Split-Interest Agreements. This Statement enhances the comparability of financial statements by providing accounting and financial reporting guidance for irrevocable split-interest agreements in which the government is a beneficiary by requiring (1) recognition of assets, liabilities, and deferred inflows of resources at the inception of the irrevocable splitinterest agreement, (2) recognition of assets representing its beneficial interests in the agreements that are administered by a third party, if the government controls the present service capacity of the beneficial interests, and (3) recognition of revenue when the resources become applicable to the reporting period. The requirements of this statement are effective for financial statements for the reporting periods beginning after December 15, CML management is evaluating the effect this standard will have on CML s financial statements. In March 2016, GASB issued Statement No. 82, Pension Issues an Amendment of GASB Statements No. 67, No. 68, and No.73. This Statement improves financial reporting by enhancing consistency in the application of financial reporting requirements to certain pension issues such as (1) the presentation of payroll-related measures in required supplementary information, (2) the selection of assumptions and the treatment of derivatives from the guidance in an Actuarial Standard of Practice for financial reporting purposes, and (3) the classification of payments made by employers to satisfy employee (plan member) contribution requirements. The requirements of this statement are effective in the first reporting period in which the measurement date of the pension liability is on or after June 15, CML management is evaluating the effect this standard will have on CML s financial statements. In November 2016, GASB Issued Statement No. 83, Certain Asset Retirement Obligations. This Statement enhances comparability of financial statements among governments by establishing uniform criteria for governments to recognize and measure certain asset retirement obligations (AROs), including obligations that may not have been previously reported. The requirements of this statement are effective for financial statements for the reporting periods beginning after June 15, CML management is evaluating the effect this standard will have on CML s financial statements. NOTE 9 JOINT VENTURES In April 1992, CML's Board of Trustees adopted a resolution to participate with the Worthington Public Library (Worthington), a separate legal entity, to construct and operate a library facility, containing approximately 23,000 square feet of public service space, at a location which will serve both library districts. On October 13, 1993, a written contract was entered into between the two library districts. According to the terms of the agreement, CML will not assume any responsibility for the daily management, operation and maintenance of the building. In addition, the agreement states that CML will contribute, based on a formula, to the operational needs of the facility. In 2016, CML contributed $1,038,107 to the operational costs of Worthington. 47

118 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 10 BUDGETARY BASIS OF ACCOUNTING The adjustments necessary to convert the results of General Fund operations and fund balances at end of year on the GAAP basis to the budgetary basis are as follows: Net Change in Fund Balance, Fund Balance December 31, 2016 GAAP basis $ 3,295,374 $ 75,211,969 Increase (decrease): Due to revenues: Received in cash during 2016, Accrued at December 31, ,103,968 - Accrued at December 31, 2016, not yet received in cash (3,620,901) (3,620,901) Due to expenditures: Paid in cash during 2016, accrued at December 31, 2015 (1,482,585) - Accrued at December 31, 2016, not yet paid in cash 1,910,489 1,910,489 Due to encumbrances: Recognized as expenditures in budget (2,952,910) (2,952,910) Budgetary Basis $ 253,435 $ 70,548,647 NOTE 11 LONG TERM LIABILITIES Long term liability activity for the year ended December 31, 2016 was as follows: Balance Balance Amount Due Type of obligation Jan 1, 2016 Additions Deletions Dec 31, 2016 Within One Year Governmental Activities: General Obligation: 2012 PLF Notes - Taxable Serials % $ 12,485,000 $ - $ (2,650,000) $ 9,835,000 $ 2,680,000 Tax-Exempt Serial Bond % 50,805,000 - (8,325,000) 42,480,000 - Tax-Exempt Term Bond % 21,120, ,120,000 - Unamortized premium 6,264,549 - (1,266,120) 4,998, Refunding Notes - Tax-Exempt Term Bond % - 9,880,000 (105,000) 9,775, ,000 Compensated Absences Payable 2,540,761 2,909,030 (3,147,602) 2,302, ,140 Net Pension Liability - OPERS 25,377,918 10,725,478-36,103,396 - Total Governmental Activities $ 118,593,228 $ 23,514,508 $ (15,493,722) $ 126,614,014 $ 3,118,140 48

119 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 11 LONG TERM LIABILITIES (Continued) (a) Long Term Debt On December 4, 2012, CML sold $92,285,000 of special obligation bonds to provide funds for the acquisition and construction of major capital facilities. The sale included tax-exempt bonds totaling $71,925,000 and taxable bonds of $20,360,000. The bonds were issued in anticipation of revenue from the state of Ohio s Public Library Fund (PLF). Debt payments will be accounted for and paid from CML s debt service fund. The first payment occurred in June 2013, and the final payment will occur in December In 2016 CML issued $9,880,000 PLF Refunding Notes to advance refund a portion of the 2012 Library Fund Library Facilities Notes. The note proceeds were invested in obligations guaranteed as to both principal and interest by the United States Government and placed in an escrow account which will use principal and earned interest to pay the interest and principal of the refunded portion of the debt. As a result, CML has in-substance satisfied its obligations through the advance refunding of those maturities. The refunding resulted in a decrease of debt service payments of $829,159 and an economic gain of $773,027. (b) Future Debt Service The following table summarizes CML s future debt obligations on its outstanding bonds: Governmental Activities Year Ending December 31, Bond Principal Interest Debt Service 2017 $ 2,855,000 $ 2,878,613 $ 5,733, ,880,000 2,846,100 5,726, ,930,000 2,800,055 5,730, ,985,000 2,744,961 5,729, ,060,000 2,670,377 5,730, ,240,000 11,506,401 28,746, ,665,000 8,422,100 29,087, ,000,000 4,094,800 29,094, ,595, ,800 5,818,800 $ 83,210,000 $ 38,187,207 $ 121,397,207 (c) Advance Refundings CML defeased bonds by placing the proceeds of the new bonds in an irrevocable trust with an escrow agent to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the liability for the defeased bonds are not included in CML s financial statements. As of December 31, 2016, defeased bonds outstanding totaled $8,325,000 and CML s escrow account balance was $9,635,339. (d) Compensated Absences and Net Pension Liability CML pays obligations related to employee compensation from the General Fund. 49

120 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 12 OTHER COMMITMENTS At December 31, CML had significant contractual commitments as follows: Vendor Amount Turner Construction $ 3,727,219 Encore One LLC/Scioto Services LLC 1,656,420 ADP Comprehensive Payroll & Benefits Services 1,500,000 Expediant Data Services 1,103,868 NBBJ 866,091 Spectrum (Formerly Known As Time Warner Cable) 751,769 Moody Nolan Limited, Inc 673,110 Xtek Partners 640,892 Library Design Associates 601,521 Cincinnati Bell Telephone Service 513,325 Floor Maintenance Group 496,902 ComDoc, Inc 398,166 DesignGroup Architects 349,633 Insight / Time Warner Communication 306,250 Dinatco, Inc 292,776 Kone, Inc 281,734 King Business Interiors 260,464 Clara Brown Interiors 252,658 Mercer Health & Benefits, LLC 170,000 Go Sustainable 127,870 Loth 121,030 Midwest Security Services, Inc 97,280 Viper/Brakefire 73,538 EBSCO 73,241 US Communications 67,207 Kalkreuth Roofing & Sheet Metal 65,348 Gale Group $ 57,233 15,525,545 At year end, CML s outstanding encumbrances in the governmental funds were as follows: General Fund $ 2,263,191 Capital Projects Fund 7,651,691 Other Governmental Funds 11,369 Total $ 9,926,251 NOTE 13 CONTINGENCIES CML management is of the opinion that the ultimate disposition of claims and legal proceedings will not have a material adverse effect, if any, on the financial condition of CML. 50

121 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 14 CHANGES IN ACCOUNTING PRINCIPLES For 2016, CML implemented GASB Statement No. 72, Fair Value Measurement and Application, which enhances comparability of financial statements among governments by requiring measurement of certain assets and liabilities at fair value using a consistent and more detailed definition of fair value and accepted valuation techniques. This statement also enhances fair value application guidance and related disclosures in order to provide information to financial statement users about the impact of fair value measurements on a government s financial position. The implementation of this statement did not have a significant effect on the financial statements of CML. For 2016, CML implemented GASB Statement No. 76 The Hierarchy of Generally Accepted Accounting Principles for State and Local Governments which improves financial reporting by (1) raising the category of GASB Implementation Guides in the GAAP hierarchy, thus providing for broader public input on implementation guidance; (2) emphasizing the importance of analogies to authoritative literature when the accounting treatment for an event is not specified in authoritative GAAP; and (3) requiring the consideration of consistency with the GASB Concepts Statements when evaluating accounting treatments specified in non-authoritative literature. The implementation of this statement did not have an effect on the financial statements of CML. For 2016, CML also implemented GASB Statement No. 79, Certain External Investment Pools and Pool Participants, which establishes criteria for an external investment pool to qualify for making the election to measure all of its investments at amortized cost for financial reporting purposes. The implementation of this statement did not have a significant effect on the financial statements of CML. For 2016, CML implemented GASB Statement No. 77, Tax Abatement Disclosures, which improves disclosure of tax abatement information, such as how the tax abatements affect a government s financial statements, operations, and ability to raise resources in the future, by reporting (1) the government s own tax abatement agreements, and (2) those entered into by other governments and that reduce the reporting government s tax revenues. See Note 15, below, regarding the effect of this statement on CML. NOTE 15 TAX ABATEMENTS Under tax abatement agreements entered into by other governments, CML s 2016 property tax revenues were reduced as follows: Amount of Government with Tax Abatement Agreement Property Taxes Abated City of Columbus $ 955,864 City of Groveport 345,905 City of New Albany 279,971 City of Obetz 250,260 City of Hilliard 30,794 City of Gahanna 26,662 City of Canal Winchester 8,715 City of Whitehall 7,810 Madison Township 5,301 Hamilton Township 3,439 City of Reynoldsburg 827 Jefferson Township 769 Total $ 1,916,317 51

122 COLUMBUS METROPOLITAN LIBRARY Notes to the Basic Financial Statements For the Year Ended December 31, 2016 NOTE 16 COMPONENT UNIT DISCLOSURES A. Basis of Accounting The financial statements of the Foundation are maintained on the accrual basis of accounting, which means that revenue are recognized as they are earned and expenses are recognized as they are incurred, whether or not cash is received or paid out at that time. B. Beneficial Interest in Assets Held by Others Beneficial interest in assets held by others, totaling $4,788,319 at December 31, 2016, represents the Foundation s interest in investments held by the Columbus Foundation, which are comprised of various equity funds, alternative assets, income funds and cash. The underlying holdings are all based on unadjusted quoted market prices and the related investment income, realized and unrealized gains and losses net of investment fees included in the accompanying statements of activities as change in value of beneficial interest in assets held by others. The Foundation advises the Columbus Foundation as to the distribution of the funds. C. Contributions Receivable The Foundation used an imputed interest rate of 5% to value pledges due after more than one year at their present value. D. Net Position Net position is classified based on the existence or absence of any imposed donor restrictions. Unrestricted net position is not subject to donor-imposed restrictions. Restricted net position is subject to donor-imposed restrictions. Net position as of December 31, 2016 is restricted as follows: Temporarily Restricted: Great Libraries Create Campaign $ 205,235 Celebration of Learning 494,519 Adopt a Book Program 21,530 Other Programs 6,786 Branches and Other Collections 24,487 Support at Risk Youth 13,696 Support Patrons for Research 60 Support Programs for Young Minds 5,977 Permanently Restricted: Larry Black Fund 14,224 Anderson Fund 75,000 Cody Conover Fund for Youth Minds 15,000 Total Restricted Net Position $ 876,514 E. Concentration of Credit Risk The Foundation maintains its cash accounts at financial institutions that are insured by the Federal Deposit Insurance Corporation on balances up to $250,000 as of December 31, At December 31, 2016, the Foundation had cash balances in excess of the federally insured limit of $0. The Foundation has not experienced any losses in these accounts. F. Related Party Transactions The Foundation had contributions receivable due from current board members totaling $411,745 at December 31, G. Concentrations During 2016, there was no concentration of revenue from a single source. 52

123 COLUMBUS METROPOLITAN LIBRARY Schedule of Library's Proportionate Share of the Net Pension Liability/(Asset) Ohio Public Employees Retirement System Last Three Years (1) Library's Proportion of the Net Pension Liability/(Asset) Traditional Plan % % % Combined Plan % % % Library's Proportionate Share of the Net Pension Liability/(Asset) Traditional Plan $ 36,103,396 $ 25,377,918 $ 24,804,715 Combined Plan $ (122,249) $ (86,146) $ (23,477) Library's Covered-Employee Payroll $ 28,615,633 $ 28,157,667 $ 27,003,731 Library's Proportionate Share of the Net Pension Liability/(Asset) as a Percentage of its Covered-Employee Payroll % 89.82% 91.77% Plan Fiduciary Net Position as a Percentage of the Total Pension Liability/(Asset) Traditional Plan 81.08% 86.45% 86.36% Combined Plan % % % (1) Information prior to 2013 is not available. Amounts presented as of the Library's measurement date, which is the prior year-end. 53

124 COLUMBUS METROPOLITAN LIBRARY Schedule of Library Contributions Ohio Public Employees Retirement System Last Four Years (1) Contractually Required Contribution $ 3,535,762 $ 3,433,876 $ 3,378,920 $ 3,510,485 Contributions in relation to the contractually required contribution $ 3,535,762 $ 3,433,876 $ 3,378,920 $ 3,510,485 Contribution deficiency (excess) $ - $ - $ - $ - Covered-employee payroll $ 29,464,683 $ 28,615,633 $ 28,157,667 $ 27,003,731 Contributions as a percentage of covered-employee payroll 12.00% 12.00% 12.00% 13.00% (1) Information prior to 2013 is not available. NOTES TO REQUIRED SUPPLEMENTARY INFORMATION For the Year Ended December 31, 2016 Changes of benefit terms - There were no changes in benefit terms affecting the OPERS plan for the plan year ended December 31, Changes in assumptions - There were no changes in assumptions or plan amendments affecting the OPERS plan for the plan year ended December 31,

125 COLUMBUS METROPOLITAN LIBRARY FUND DESCRIPTIONS Major Funds General Fund The General Fund is the general operating fund of the Library. It is used to account for all financial resources except those required to be accounted for in another fund. Capital Projects Fund The Capital Projects Fund is used to account for the acquisition and/or construction of major capital facilities and equipment other than those financed by Proprietary Funds. Active capital projects for 2016 are: Whitehall Branch Project Main Library Renovation Project Hilliard Branch Project Northern Lights Branch Project Martin Luther King Branch Project Parsons Branch Project Northside Branch Project Shepard Branch Project Dublin Branch Project Debt Service Fund The Debt Service Fund is used to account for and report resources restricted, committed, or assigned to expenditure for principal and interest on debt. In 2012 the Library s Board of Trustees established a debt service fund and authorized the Library to issue debt in anticipation of its PLF revenue for the purpose of purchasing, leasing, constructing, renovating and improving library facilities. Non-Major Funds Special Revenue Funds Special Revenue Funds are used to account for types of resources for which specific uses are mandated by Library Board policies, federal and/or state statutes, or other external donors. The title of the fund is descriptive of the activities accounted for therein. The Special Revenue Funds are: Restricted Fund Land Development Fund Permanent Fund The Permanent Fund is used to report resources that are legally restricted to the extent that only investment earnings, not principal, may be used for purposes that support the Library s programs. Internal Service Fund The Internal Service Fund is used to account for goods or services provided by one department to other departments of the Library. The Library has an internal service fund to account for its Self-Insurance program. Agency Fund The Agency fund is used to account for funds held and administered by the Library on behalf of other government agencies. The Library s only agency fund is the Digital Downloads Collaboration which is used to administer a consortium of multiple libraries for the acquisition and distribution of digital content. 55

126 COLUMBUS METROPOLITAN LIBRARY Combining Supplemental Schedule of Assets, Liabilities and Fund Balances General Fund December 31, 2016 Total General General General 27th General Operating Projects Liability Pay Period Fund Assets: Equity in Pooled Cash and Investments $ 64,781,332 $ 7,489,900 $ 644,364 $ 1,230,325 $ 74,145,921 Receivables: Taxes 49,673, ,673,707 Accounts 63, ,212 Intergovernmental 3,715, ,715,789 Prepaid Items 809,751 2, ,471 Total Assets $ 119,043,791 $ 7,492,620 $ 644,364 $ 1,230,325 $ 128,411,100 Liabilities: Accounts Payable $ 1,157,636 $ 97,202 $ 43,276 $ - $ 1,298,114 Accrued Wages and Benefits 1,297, ,022-1,577,148 Intergovernmental Payable 171, , ,293 Total Liabilities 2,625,989 97, ,364-3,367,555 Deferred Inflows of Resources: Property Taxes 44,726, ,726,155 Unavailable Revenue 5,105, ,105,421 Total Deferred Inflows of Resources 49,831, ,831,576 Fund Balances: Nonspendable: Prepaid Items 809,751 2, ,471 Committed for: Facility and Technology Projects - 1,863, ,863,475 Library Materials 150, ,670 Operations/Programing 7,333, ,333,861 Assigned for: Library Materials 343, ,530 Operations/Programing 85, ,432 Facility and Technology Projects - 5,529, ,529,223 27th Pay Period ,230,325 1,230,325 Unassigned 57,862, ,862,982 Total Fund Balances 66,586,226 7,395,418-1,230,325 75,211,969 Total Liabilities, Deferred Inflows, and Fund Balances $ 119,043,791 $ 7,492,620 $ 644,364 $ 1,230,325 $ 128,411,100 56

127 COLUMBUS METROPOLITAN LIBRARY Combining Supplemental Schedule of Revenues Expenditures and Changes in Fund Balances General Fund For the Year Ended December 31, 2016 Total General General General 27th General Operating Projects Liability Pay Period Fund Revenues: Property Taxes $ 46,577,352 $ - $ - $ - $ 46,577,352 Intergovernmental 20,210, ,210,484 Fines and Fees 555, ,556 Investment Earnings 845, ,922 Charges for Services 692, ,422 Contributions and Donations 50, ,075 Miscellaneous 122, ,257 Total Revenues 69,054, ,054,068 Expenditures: Current: Public Service 35,202,794 3,228, ,431,366 Administrative and Support 23,774,042 1,369, ,143,572 Capital Outlay 173,479 2,022, ,195,995 Total Expenditures 59,150,315 6,620, ,770,933 Excess (Deficiency) of Revenues Over (Under) Expenditures 9,903,753 (6,620,618) - - 3,283,135 Other Financing Sources (Uses): Proceeds from Sale of Capital Assets 12, ,239 Transfers In (205,000) ,000 - Transfers Out 1,285,000 (1,285,000) Total Other Financing Sources (Uses) 1,092,239 (1,285,000) - 205,000 12,239 Net Change in Fund Balances 10,995,992 (7,905,618) - 205,000 3,295,374 Fund Balance at Beginning of Year 55,590,234 15,301,036-1,025,325 71,916,595 Fund Balance at End of Year $ 66,586,226 $ 7,395,418 $ - $ 1,230,325 $ 75,211,969 57

128 COLUMBUS METROPOLITAN LIBRARY Combining Supplemental Schedule of Assets, Liabilities and Project Balances Capital Projects Fund December 31, 2016 Assets: Equity in Pooled Cash and Investments 25,984,491 HVAC Roof Non-Project 2020 Replacement Replacement Related Project Project Project Totals $ $ 5,258,918 $ 31,666 $ 76,366 $ 31,351,441 Cash and Cash Equivalents - Restricted - 17,407, ,407,195 Receivables: Interest 316, ,805 Prepaid Items - 3, ,614 Total Assets $ 26,301,296 $ 22,669,727 $ 31,666 $ 76,366 $ 49,079,055 Liabilities: Accounts Payable $ - $ 665,551 $ - $ - $ 665,551 Retainage Payable - 668, ,638 Total Liabilities - 1,334, ,334,189 Deferred Inflows of Resources: Unavailable Revenue 125, ,805 Total Deferred Inflows of Resources 125, ,805 Fund Balances: Nonspendable: Prepaid Items - 3, ,614 Restricted for: Capital Projects - 17,407, ,407,195 Committed for: Capital Projects - 3,924,729 31,666 76,366 4,032,761 Assigned for: Capital Projects 26,175, ,175,491 Total Fund Balances 26,175,491 21,335,538 31,666 76,366 47,619,061 Total Liabilities, Deferred Inflows, and Fund Balances $ 26,301,296 $ 22,669,727 $ 31,666 $ 76,366 $ 49,079,055 58

129 COLUMBUS METROPOLITAN LIBRARY Combining Supplemental Schedule of Revenues, Expenditures and Changes in Project Balance Capital Projects Fund For the Year Ended December 31, 2016 HVAC Roof Non-Project 2020 Replacement Replacement Related Project Project Project Totals Revenues: Investment Earnings $ 366,322 $ - $ - $ - $ 366,322 Contributions and Donations 3,950,187 6,000, ,950,187 Miscellaneous 74, ,573 Total Revenues 4,391,082 6,000, ,391,082 Expenditures: Capital Outlay - 43,399,103 5,650-43,404,753 Total Expenditures - 43,399,103 5,650-43,404,753 Excess (Deficiency) of Revenues Over (Under) Expenditures 4,391,082 (37,399,103) (5,650) - (33,013,671) Other Financing Sources (Uses): Proceeds from Sale of Capital Assets 913, ,019 Total Other Financing Sources (Uses) 913, ,019 Net Change in Fund Balances 5,304,101 (37,399,103) (5,650) - (32,100,652) Fund Balance at Beginning of Year 20,871,390 58,734,641 37,316 76,366 79,719,713 Fund Balance at End of Year $ 26,175,491 $ 21,335,538 $ 31,666 $ 76,366 $ 47,619,061 59

130 COLUMBUS METROPOLITAN LIBRARY Combining Balance Sheet Nonmajor Governmental Funds December 31, 2016 Total Nonmajor Nonmajor Nonmajor Special Revenue Permanent Governmental Funds Fund Totals Assets: Equity in Pooled Cash and Investments $ 1,110,033 $ 1,055 $ 1,111,088 Cash and Cash Equivalents - Restricted - 67,742 67,742 Receivables: Intergovernmental 108, ,194 Prepaid Items Total Assets $ 1,218,348 $ 68,797 $ 1,287,145 Liabilities: Accounts Payable $ 19,854 $ - $ 19,854 Security Deposits 58,428-58,428 Total Liabilities 78,282-78,282 Fund Balances: Nonspendable: Prepaid Items Permanent Fund Principal - 67,742 67,742 Restricted for: Permanent Fund Expendable - 1,055 1,055 Restricted Donations 514, ,505 Committed for: Land Development 625, ,440 Total Fund Balances 1,140,066 68,797 1,208,863 Total Liabilities and Fund Balance $ 1,218,348 $ 68,797 $ 1,287,145 60

131 COLUMBUS METROPOLITAN LIBRARY Combining Statement of Revenues, Expenditures and Changes in Fund Balance Nonmajor Governmental Funds For the Year Ended December 31, 2016 Total Nonmajor Nonmajor Nonmajor Special Revenue Permanent Governmental Funds Fund Totals Revenues: Investment Earnings $ 5,196 $ 363 $ 5,559 Charges for Services 797, ,314 Contributions and Donations 251, ,946 Miscellaneous 40,121-40,121 Total Revenues 1,094, ,094,940 Expenditures: Current: Salaries and Benefits 71,593-71,593 Supplies 85,751-85,751 Purchased Services 62,696-62,696 Library Materials 15,158-15,158 Public Service 235, ,198 Supplies 34,260-34,260 Purchased Services 485, ,600 Other Administrative and Support 520, ,076 Capital Outlay 10,700-10,700 Total Expenditures 765, ,974 Net Change in Fund Balances 328, ,966 Fund Balance at Beginning of Year 811,463 68, ,897 Fund Balance at End of Year $ 1,140,066 $ 68,797 $ 1,208,863 61

132 COLUMBUS METROPOLITAN LIBRARY Combining Balance Sheet Nonmajor Special Revenue Funds December 31, 2016 Total Nonmajor Restricted Land Special Revenue Donation Development Funds Assets: Equity in Pooled Cash and Investments $ 426,165 $ 683,868 $ 1,110,033 Receivables: Intergovernmental 108, ,194 Prepaid Items Total Assets $ 534,480 $ 683,868 $ 1,218,348 Liabilities: Accounts Payable $ 19,854 $ - $ 19,854 Security Deposits - 58,428 58,428 Total Liabilities 19,854 58,428 78,282 Fund Balances: Nonspendable: Prepaid Items Restricted for: Restricted Donations 514, ,505 Committed for: Land Development - 625, ,440 Total Fund Balances 514, ,440 1,140,066 Total Liabilities and Fund Balance $ 534,480 $ 683,868 $ 1,218,348 62

133 COLUMBUS METROPOLITAN LIBRARY Combining Statement of Revenues, Expenditures and Changes in Fund Balance Nonmajor Special Revenue Funds For the Year Ended December 31, 2016 Total Nonmajor Restricted Land Special Revenue Donation Development Funds Revenues: Investment Earnings $ - $ 5,196 $ 5,196 Charges for Services - 797, ,314 Contributions and Donations 251, ,946 Miscellaneous 5,945 34,176 40,121 Total Revenues 257, ,686 1,094,577 Expenditures: Current: Salaries and Benefits 71,593-71,593 Supplies 85,751-85,751 Purchased Services 62,696-62,696 Library Materials 15,158-15,158 Public Service 235, ,198 Supplies - 34,260 34,260 Purchased Services - 485, ,600 Other Administrative and Support - 520, ,076 Capital Outlay 10,700-10,700 Total Expenditures 245, , ,974 Net Change in Fund Balances 11, , ,603 Fund Balance at Beginning of Year 502, , ,463 Fund Balance at End of Year $ 514,626 $ 625,440 $ 1,140,066 63

134 COLUMBUS METROPOLITAN LIBRARY Combining Schedule of Revenues, Expenditures and Changes in Fund Balances Budget (Non-GAAP Basis) and Actual General Fund For the Year Ended December 31, 2016 General Operating Account Original Final Variance Budget Budget Actual (Over)/Under Revenues Property Taxes $ 44,728,000 $ 44,728,000 $ 46,034,928 $ 1,306,928 Intergovernmental 21,145,812 21,145,812 20,226,171 (919,641) Fines and Fees 550, , ,656 (1,344) Investment Earnings 525, , , ,313 Charges for Services 691, , ,083 (20,917) Contributions and Donations 1,000 1,000 50,075 49,075 Miscellaneous 284, , ,909 (125,091) Total Revenues 67,924,812 67,924,812 68,537, ,323 Expenditures Current: Public Service Salaries and Benefits 28,327,399 28,852,202 26,074,323 2,777,879 Supplies 237, , ,513 25,708 Purchased Services 1,198,323 1,193,720 1,030, ,638 Library Materials 8,430,482 8,433,792 8,270, ,361 Administrative and Support Salaries and Benefits 10,356,086 9,676,048 10,849,901 (1,173,853) Supplies 2,429,597 2,471,534 2,410,272 61,262 Purchased Services 10,716,344 10,974,673 10,513, ,620 Library Materials 8,482 8,482 6,893 1,589 Other 2,085,740 1,803,314 1,038, ,207 Capital Outlay 184, , ,211 25,230 Total Expenditures 63,974,427 63,974,427 60,702,786 3,271,641 Excess of Revenues Over (Under) Expenditures 3,950,385 3,950,385 7,834,349 3,883,964 Other Financing Sources (Uses) Proceeds from Sale of Capital Assets 25,000 25,000 12,239 (12,761) Transfers In 1,285,000 1,285,000 1,285,000 - Transfers Out (205,000) (205,000) (205,000) - Total Other Financing Sources (Uses) 1,105,000 1,105,000 1,092,239 (12,761) Net Change in Fund Balance 5,055,385 5,055,385 8,926,588 3,871,203 Fund Balances at Beginning of Year 50,994,392 50,994,392 50,994,392 - Prior Year Encumbrances Appropriated 2,828,660 2,828,660 2,828,660 - Fund Balances at End of Year $ 58,878,437 $ 58,878,437 $ 62,749,640 $ 3,871,203 64

135 General Projects Account Original Final Variance Budget Budget Actual (Over)/Under $ - $ - $ - $ ,410,748 5,201,533 3,724,366 1,477,167 50, , ,153 12, , , ,572 1,358 2,394,615 1,448,384 1,283, , ,000,000 1,242,486-1,242,486 2,124,450 2,745,392 2,212, ,011 11,167,458 11,024,828 7,593,153 3,431,675 (11,167,458) (11,024,828) (7,593,153) 3,431, (1,285,000) (1,285,000) (1,285,000) - (1,285,000) (1,285,000) (1,285,000) - (12,452,458) (12,309,828) (8,878,153) 3,431,675 13,555,959 13,555,959 13,555,959-1,890,876 1,890,876 1,890,876 - $ 2,994,377 $ 3,137,007 $ 6,568,682 $ 3,431,675 (continued) 65

136 COLUMBUS METROPOLITAN LIBRARY Combining Schedule of Revenues, Expenditures and Changes in Fund Balances Budget (Non-GAAP Basis) and Actual General Fund For the Year Ended December 31, th Pay Period Account Original Final Variance Budget Budget Actual (Over)/Under Revenues Property Taxes $ - $ - $ - $ - Intergovernmental Fines and Fees Investment Earnings Charges for Services Contributions and Donations Miscellaneous Total Revenues Expenditures Current: Public Service Salaries and Benefits Supplies Purchased Services Library Materials Administrative and Support Salaries and Benefits Supplies Purchased Services Library Materials Other Capital Outlay Total Expenditures Excess of Revenues Over (Under) Expenditures Other Financing Sources (Uses) Proceeds from Sale of Capital Assets Transfers In 205, , ,000 - Transfers Out Total Other Financing Sources (Uses) 205, , ,000 - Net Change in Fund Balance 205, , ,000 - Fund Balances at Beginning of Year 1,025,325 1,025,325 1,025,325 - Prior Year Encumbrances Appropriated Fund Balances at End of Year $ 1,230,325 $ 1,230,325 $ 1,230,325 $ - 66

137 Combining General Fund Totals Original Final Variance Budget Budget Actual (Over)/Under $ 44,728,000 $ 44,728,000 $ 46,034,928 $ 1,306,928 21,145,812 21,145,812 20,226,171 (919,641) 550, , ,656 (1,344) 525, , , , , , ,083 (20,917) 1,000 1,000 50,075 49, , , ,909 (125,091) 67,924,812 67,924,812 68,537, ,323 28,327,399 28,852,202 26,074,323 2,777,879 5,648,014 5,492,754 3,989,879 1,502,875 1,249,041 1,352,823 1,176, ,588 8,430,482 8,433,792 8,270, ,361 10,356,086 9,676,048 10,849,901 (1,173,853) 2,616,524 2,699,464 2,636,844 62,620 13,110,959 12,423,057 11,796, ,323 8,482 8,482 6,893 1,589 3,085,740 3,045,800 1,038,107 2,007,693 2,309,158 3,014,833 2,456, ,241 75,141,885 74,999,255 68,295,939 6,703,316 (7,217,073) (7,074,443) 241,196 7,315,639 25,000 25,000 12,239 (12,761) 1,490,000 1,490,000 1,490,000 - (1,490,000) (1,490,000) (1,490,000) - 25,000 25,000 12,239 (12,761) (7,192,073) (7,049,443) 253,435 7,302,878 65,575,676 65,575,676 65,575,676-4,719,536 4,719,536 4,719,536 - $ 63,103,139 $ 63,245,769 $ 70,548,647 $ 7,302,878 67

138 COLUMBUS METROPOLITAN LIBRARY Schedule of Revenues, Expenditures and Changes in Fund Balance Budget (Non-GAAP Basis) and Actual Restricted - Special Revenue Fund For the Year Ended December 31, 2016 Final Variance Budget Actual (Over)/Under Revenues Contributions and Donations $ 497,000 $ 309,462 $ (187,538) Total Revenues 497, ,462 (187,538) Expenditures Current: Public Service Salaries and Benefits 90,171 71,593 18,578 Supplies 401,961 93, ,238 Purchased Services 134,925 72,215 62,710 Library Materials 41,640 14,157 27,483 Other 161,587 (5,945) 167,532 Capital Outlay 10,700 10,700 - Total Expenditures 840, , ,541 Net Change in Fund Balance (343,984) 53, ,003 Fund Balances at Beginning of Year 326, ,374 - Prior Year Encumbrances Appropriated 17,984 17,984 - Fund Balances at End of Year $ 374 $ 397,377 $ 397,003 68

139 COLUMBUS METROPOLITAN LIBRARY Schedule of Revenues, Expenditures and Changes in Fund Balance Budget (Non-GAAP Basis) and Actual Land Development - Special Revenue Fund For the Year Ended December 31, 2016 Final Variance Budget Actual (Over)/Under Revenues Investment Earnings $ 1,800 $ 5,196 $ 3,396 Charges for Services 753, ,314 43,414 Miscellaneous 21,000 32,470 11,470 Total Revenues 776, ,980 58,280 Expenditures Current: Administrative and Support Supplies 65,600 34,260 31,340 Purchased Services 611, , ,723 Other (216) Total Expenditures 676, , ,847 Net Change in Fund Balance 99, , ,127 Fund Balances at Beginning of Year 368, ,964 - Prior Year Encumbrances Appropriated Fund Balances at End of Year $ 468,741 $ 683,868 $ 215,127 69

140 COLUMBUS METROPOLITAN LIBRARY Schedule of Revenues, Expenditures and Changes in Fund Balance Budget (Non-GAAP Basis) and Actual Permanent Fund For the Year Ended December 31, 2016 Final Variance Budget Actual (Over)/Under Revenues Investment Earnings $ 20 $ 377 $ 357 Total Revenues Expenditures Current: Public Service Library Materials Administrative and Support Library Materials Total Expenditures Net Change in Fund Balance (680) 377 1,057 Fund Balances at Beginning of Year Prior Year Encumbrances Appropriated Fund Balances at End of Year $ (2) $ 1,055 $ 1,057 70

141 COLUMBUS METROPOLITAN LIBRARY Schedule of Revenues, Expenditures and Changes in Fund Balance Budget (Non-GAAP Basis) and Actual Debt Service Fund For the Year Ended December 31, 2016 Final Variance Budget Actual (Over)/Under Revenues Intergovernmental $ 5,815,858 $ 5,771,356 $ (44,502) Investment Earnings - 4,095 4,095 Total Revenues 5,815,858 5,775,451 (40,407) Expenditures Debt service: Principal Retirement 2,650,000 2,755,000 (105,000) Interest and Fiscal Charges 3,165,858 3,023, ,648 Bond Issuance Costs 75,265 74, Total Expenditures 5,891,123 5,852,810 38,313 Excess of Revenues Over (Under) Expenditures (75,265) (77,359) (2,094) Other Financing Sources (Uses) Issuance of Refunding Bonds 9,880,000 9,880,000 - Payment to Refunded Bond Escrow Agent (9,804,735) (9,804,735) - Total Other Financing Sources (Uses) 75,265 75,265 - Net Change in Fund Balance - (2,094) (2,094) Fund Balances at Beginning of Year 486, ,520 - Prior Year Encumbrances Appropriated Fund Balances at End of Year $ 486,520 $ 484,426 $ (2,094) 71

142 COLUMBUS METROPOLITAN LIBRARY Schedule of Revenues, Expenditures and Changes in Fund Balance Budget (Non-GAAP Basis) and Actual Capital Projects Fund For the Year Ended December 31, 2016 Final Variance Budget Actual (Over)/Under Revenues Investment Earnings $ 391,565 $ 519,332 $ 127,767 Contributions and Donations 5,000,000 9,950,187 4,950,187 Miscellaneous - 74,573 74,573 Total Revenues 5,391,565 10,544,092 5,152,527 Expenditures* Capital Outlay 84,089,852 54,488,746 29,601,106 Total Expenditures 84,089,852 54,488,746 29,601,106 Excess of Revenues Over (Under) Expenditures (78,698,287) (43,944,654) 34,753,633 Other Financing Sources (Uses) Proceeds from Sale of Capital Assets 644, , ,019 Total Other Financing Sources (Uses) 644, , ,019 Net Change in Fund Balance (78,054,287) (43,031,635) 35,022,652 Fund Balances at Beginning of Year 51,940,418 51,940,418 - Prior Year Encumbrances Appropriated 32,345,370 32,345,370 - Fund Balances at End of Year $ 6,231,501 $ 41,254,153 $ 35,022,652 *The amounts presented in the budget represents the project budgets that is to be spent over the life of the projects. 72

143 COLUMBUS METROPOLITAN LIBRARY Statement of Changes in Fiduciary Assets and Liabilities Agency Fund - Digital Download Collaboration December 31, 2016 Balance Balance January 1, December 31, 2016 Additions Deletions 2016 Assets Equity in Pooled Cash and Investments $ 141,716 $ 280,793 $ 119,267 $ 303,242 Accounts Receivable 79,000-79,000 - Total Assets 220, , , ,242 Liabilities Accounts Payable and Other Liabilities 220, , , ,242 Total Liabilities $ 220,716 $ 280,793 $ 198,267 $ 303,242 73

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145 STATISTICAL SECTION 75

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147 STATISTICAL SECTION This section of the Columbus Metropolitan Library s (CML) Comprehensive Annual Financial Report (CAFR) presents current and historical information as a context for understanding the financial statements, note disclosures, and required information. Pages Financial Trends These schedules summarize financial information to assist the reader in analyzing and understanding how CML s financial performance and condition changed over time. Revenue Capacity These schedules contain information to assist the reader in evaluating factors affecting CML s ability to generate property tax revenue. Debt Capacity These schedules contain information to help the reader in evaluating CML s ability to pay off long term debt. Economic and Demographic Information These schedules offer economic and demographic indicators to assist the reader in understanding environmental factors that influence CML s financial activities. Operating Information These schedules assist the reader in measuring CML s financial performance as it relates to various operational statistics. Sources: Unless otherwise noted, the information in these schedules is derived from the CAFR s for the relevant year. In fiscal year 2011, CML implemented GASB No. 54, schedules reporting fund balance classifications commenced that year. 77

148 Columbus Metropolitan Library Net Position by Component, Last Ten Fiscal Years (accrual basis of accounting) Fiscal Year Governmental activities Net Investment in Capital Assets $ 70,477,531 $ 69,437,656 $ 68,643,901 $ 67,167,277 $ 65,687,200 $ 65,519,104 $ 68,969,845 $ 66,549,451 $ 67,209,856 $ 72,339,611 Restricted 10,943,907 9,113,095 7,661,520 6,534,500 26,513,196 26,460,875 2,274,372 4,276,056 5,152,021 1,238,024 Non-Expendable 67,742 67,742 67,742 67,742 67,742 67,742 67,742 67,742 67,742 67,742 Unrestricted 12,714,129 11,259,145 7,265,132 7,669,410 14,179,366 29,745,728 70,481,717 64,783,315 78,159,336 88,295,590 Total primary government net position $ 94,203,309 $ 89,877,638 $ 83,638,295 $ 81,438,929 $ 106,447,504 $ 121,793,449 $ 141,793,676 $ 135,676,564 $ 150,588,955 $ 161,940,967 Note: GASB 68 was implemented in Effects of the implementation can not fully be shown for prior years 78

149 Columbus Metropolitan Library Changes in Net Position, Last Ten Fiscal Years (accrual basis of accounting) Fiscal Year Expenses Governmental activities: Public Service $ 34,198,334 $ 34,999,765 $ 33,105,824 $ 29,768,963 $ 37,143,023 $ 36,923,350 $ 33,995,179 $ 35,739,513 $ 37,072,271 $ 43,771,043 Administrative and Support 19,428,007 20,324,972 18,339,648 17,014,855 21,144,501 21,904,360 24,786,351 22,754,509 25,116,698 28,489,455 Interest Expense ,199 2,912,100 2,909,404 2,894,941 2,783,526 Issuance Costs ,600 Total primary government expenses $ 53,626,341 $ 55,324,737 $ 51,445,472 $ 46,783,818 $ 58,287,524 $ 59,091,909 $ 61,693,630 $ 61,403,426 $ 65,083,910 $ 75,118,624 Program Revenues Governmental activities: Charges for Services Public Service $ 2,418,348 $ 2,264,448 $ 2,201,915 $ 1,901,782 $ 1,975,996 $ 1,427,822 $ 1,189,910 $ 831,448 $ 583,487 $ 555,556 Administrative and Support 1,618,728 1,418,800 1,355,577 1,354,700 1,431,254 1,369,663 1,415,195 1,400,049 1,394,132 1,489,736 Operating grants and contributions 130, , ,625 1,389, , , , , , ,021 Total primary government program revenues $ 4,167,632 $ 3,978,200 $ 4,141,117 $ 4,646,442 $ 4,284,119 $ 3,208,391 $ 2,928,774 $ 2,500,579 $ 2,355,272 $ 2,347,313 Net (Expense) Revenue Total primary government net expense $ (49,458,709) $ (51,346,537) $ (47,304,355) $ (42,137,376) $ (54,003,405) $ (55,883,518) $ (58,764,856) $ (58,902,847) $ (62,728,638) $ (72,771,311) General Revenues and Other Changes in Net Position Governmental activities: Property taxes $ 18,233,344 $ 17,530,349 $ 15,808,287 $ 15,669,459 $ 50,680,324 $ 44,081,501 $ 47,651,678 $ 42,943,916 $ 42,967,424 $ 46,920,532 Intergovernmental, unrestricted 16,019,512 28,487,444 24,799,451 24,101,422 28,109,034 26,188,636 29,027,326 26,020,216 27,478,601 25,796,415 Capital contributions - not program specific , ,000,000 4,025,000 5,748,133 9,950,187 Unrestricted investment earnings 1,495,748 1,089, , , , , , ,581 1,022,906 1,219,238 Miscellaneous , , , , ,951 Total primary government $ 35,748,604 $ 47,107,587 $ 40,932,199 $ 39,938,010 $ 79,011,980 $ 71,229,463 $ 78,547,402 $ 74,362,265 $ 77,641,029 $ 84,123,323 Changes in Net Position Total primary government $ (13,710,105) $ (4,238,950) $ (6,372,156) $ (2,199,366) $ 25,008,575 $ 15,345,945 $ 19,782,546 $ 15,459,418 $ 14,912,391 $ 11,352,012 Note: GASB 68 was implemented in Effects of the implementation can not fully be shown for prior years 79

150 Columbus Metropolitan Library Fund Balances, Governmental Funds, Last Ten Fiscal Years (modified accrual basis of accounting) Fiscal Year General Fund Non-Spendable $ - $ - $ - $ - $ 745,435 $ 840,400 $ 797,312 $ 947,733 $ 769,694 $ 812,471 Restricted Committed ,366 1,812, ,755 1,868,809 3,845,860 - Assigned 2,373,149 2,224,307 1,029,204 1,029,204 4,104,753 2,713,267 2,160,973 15,504,580 14,581,284 9,659,222 Unassigned 8,881,711 6,089,229 6,475,532 5,633,109 5,995,483 23,664,390 38,160,939 45,498,931 52,719,757 64,740,276 Total general fund 11,254,860 8,313,536 7,504,736 6,662,313 11,283,037 29,030,141 42,008,979 63,820,053 71,916,595 75,211,969 All Other Governmental Funds Non-Spendable $ 67,742 $ 67,742 $ 67,742 $ 67,742 $ 84,414 $ 84,324 $ 88,581 $ 68,676 $ 86,202 $ 71,477 Restricted ,769 77,132,800 96,385,042 84,129,635 56,267,798 18,884,982 Committed ,795 1,102,393 4,479, ,802 4,345,395 4,658,201 Assigned 10,363,015 8,727,016 6,719,882 6,339,926 25,349,960 46,342,298 17,453,798 15,487,543 20,871,390 26,175,491 Unassigned Total all governmental Funds 21,685,617 17,108,294 14,292,360 13,069,981 37,863, ,691, ,415, ,741, ,487, ,002,120 Note: CML implemented GASB Statement 34 in CML implemented GASB 54 in 2011; fund balance classifications are reported prospectively, with the exception of the Principal Balance required to be maintained intact, and therefore is Non-Spendable 80

151 Columbus Metropolitan Library Changes in Fund Balances, Governmental Funds, Last Ten Fiscal Years (modified accrual basis of accounting) Fiscal Year Revenues Property Taxes $ 18,307,983 $ 16,515,427 $ 15,976,544 $ 15,976,544 $ 48,318,432 $ 44,765,211 $ 46,748,089 $ 43,535,330 $ 44,098,394 $ 46,577,352 Intergovernmental 22,536,974 28,487,444 24,856,280 24,856,280 28,109,034 26,188,636 26,215,156 26,020,216 27,737,200 25,974,986 Fines and Fees 1,945,475 2,041,208 1,864,263 1,864,263 1,532,581 1,427,822 1,189, , , ,556 Investment Earnings 1,350, , , , , , , , ,225 1,221,898 Charges for Services 1,486,019 1,549, , ,801 1,431,254 1,369,663 1,415,195 1,400,049 1,394,132 1,489,736 Contributions and Donations 130, , ,855 1,389, , ,906 1,323,669 4,294,082 6,125,786 10,252,208 Miscellaneous 601, , , , , , , , , ,951 Total revenues 46,359,091 49,918,766 45,176,884 45,918,139 80,935,540 75,103,458 77,668,054 77,429,750 81,246,275 86,308,687 Expenditures Public Service 33,012,423 33,385,801 31,053,545 29,400,950 35,569,558 34,022,084 33,300,994 35,420,238 36,000,505 38,666,564 Administrative 17,405,684 18,882,474 15,703,784 16,273,101 19,908,901 22,833,115 23,799,477 22,806,297 24,241,587 25,663,648 Capital Outlay 2,516,435 2,141,093 1,368, , ,714 1,863,322 8,933,331 10,097,870 25,464,650 45,611,448 Debt Service Principal ,620,000 2,620,000 2,635,000 2,755,000 Interest ,197,256 3,197,924 3,183,776 3,023,210 Issuance Costs ,600 Total expenditures 52,934,542 54,409,368 48,125,631 46,161,957 56,405,173 58,718,521 71,851,058 74,142,329 91,525, ,794,470 Excess of revenues over (under) expenditures (6,575,451) (4,490,602) (2,948,747) (243,818) 24,530,367 16,384,937 5,816,996 3,287,421 (10,279,243) (29,485,783) Other Financing Sources (Uses) Transfers In 22,768 5,419, ,986, , ,000 12,935, Transfers Out (22,768) (5,419,996) - - (25,986,258) (484,771) (100,000) (12,935,994) - - Proceeds from sale of property , ,975 38,361 24, ,258 Debt Issuance & Premium ,435, ,880,000 Payment to Refunded Bond Escrow Agent (9,804,735) Total other financing sources (uses) ,443, ,975 38,361 24,914 1,000,523 Net change in fund balances $ (6,575,451) $ (4,490,602) $ (2,948,747) $ (243,818) $ 24,530,367 $ 115,827,981 $ 6,723,971 $ 3,325,782 $ (10,254,329) $ (28,485,260) Debt service as a percentage of noncapital expenditures 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 9.16% 9.14% 8.74% 7.97% 81

152 Columbus Metropolitan Library Assessed and Estimated Actual Value of Taxable Property, Last Ten Fiscal Years (in thousands) Real Property Personal Property Estimated Estimated Tax Assessed Actual Assessed Actual Year 1 Value Value Value Value 2007 $18,820,172 $53,771,920 $466,184 $1,864, ,197,804 54,850,869 58, , ,279,860 55,085,314 29, , ,631,342 56,089, ,840,838 50,973, ,741,483 53,547, ,594,534 50,270, ,594,534 50,270, ,732,196 50,663, ,025,564 51,501, Source: Franklin County Auditor 1 Tax year ended December 31, yyyy represents the year taxes are collected. However, they are applied the following year (e.g. taxes collected in 2016 are applied in 2017). 2 Rate per $1,000 of assessed value. The library full rate is The full rate for all Franklin County agencies is This is the voted levy rate, however the effective tax rate was much lower for these years. 82

153 Public Utilities Total Assessed Estimated Estimated CML's Value as a Assessed Actual Assessed Actual Direct Percentage of Value Value Value Value Tax Rate 2 Actual Value $408,559 $1,167,311 $19,694,915 $56,803,967 $2.20 (3) % 422,371 1,206,774 19,679,112 56,647, (3) ,874 1,248,211 19,746,202 56,628, (3) ,486 1,344,246 20,101,828 57,433, (3) ,145 1,348,986 18,312,983 52,322, ,509 1,427,169 19,240,992 54,974, ,095 1,560,271 18,140,629 51,830, ,095 1,560,271 18,140,629 51,830, ,073 1,834,494 18,374,269 52,497, ,422 2,081,206 18,753,986 53,582,

154 Columbus Metropolitan Library Direct and Overlapping Property Tax Rates, Last Ten Fiscal Years (rate per $1,000 of assessed value) for for for for for for for for for for COUNTY - Franklin County $17.84 $18.02 $18.07 $18.07 $18.07 $18.47 $18.47 $18.47 $18.47 $18.47 Years SCHOOL DISTRICT: Canal Winchester $61.25 $62.93 $77.75 $78.16 $79.13 $79.45 $78.70 $78.70 $78.70 $79.00 Columbus Dublin Gahanna-Jefferson Groveport-Madison Hamilton Hilliard Licking Heights Reynoldsburg Upper Arlington Whitehall

155 Columbus Metropolitan Library Direct and Overlapping Property Tax Rates, Last Ten Fiscal Years (rate per $1,000 of assessed value) for for for for for for for for for for JOINT VOCATIONAL SCHOOL DISTRICT: Central Ohio $1.30 $1.30 $ 1.30 $ 1.30 $ 1.60 $ 1.60 $ 1.60 $ 1.60 $ 1.60 $ 1.60 Eastland Licking County Years MUNICIPAL CORPORATIONS: Brice $3.20 $3.20 $ 3.20 $ 3.20 $ 3.20 $ 3.20 $ 3.20 $ 3.20 $ 3.20 $ 3.20 Canal Winchester Columbus Dublin Gahanna Groveport Hilliard Lockbourne New Albany Obetz Reynoldsburg Valleyview Whitehall Lithopolis

156 Columbus Metropolitan Library Direct and Overlapping Property Tax Rates, Last Ten Fiscal Years (rate per $1,000 of assessed value) for for for for for for for for for for TOWNSHIPS: Blendon $26.51 $26.56 $ $ $ $ $ $ Brown Clinton Franklin Hamilton Jefferson Madison Mifflin Norwich Perry Plain Prairie Sharon Truro Washington OTHER ENTITIES: Columbus Metropolitan Library $2.20 $2.20 $ 2.20 $ 2.80 $ 2.80 $ 2.80 $ 2.80 $ 2.80 $ 2.80 $ 2.80 Metropolitan Park District Source: Franklin County Auditor Years 86

157 Columbus Metropolitan Library Principal Property Taxpayers, Current Year and Nine Years Ago Fiscal Year Fiscal Year Percentage Percentage of Total City of Total City Taxable Taxable Assessed Assessed Assessed Assessed Taxpayer Value Rank Value 1 Value Rank Value 2 Ohio Power Company $ 480,211, % $ 334,593, % Columbia Gas of Ohio Inc 103,909, ,425, Nationwide Mutual Insurance Co 76,683, ,001, AEP Ohio Transmission Company Inc 72,183, ,851, Distribution Land Corp 66,229, ,122, LSREF3 BRAVO LLC 41,615, Huntington Center Owner LLC 39,221, ,100, Columbus Regional 34,890, Ohio Bureau of Workers' Compensation 34,825, State of Ohio 34,784, Easton Gateway LLC 22,238, AEP Ohio Transmission Company Inc 21,652, Total $ 1,028,444, % $ 788,667, % 1 The total assessed valuation for 2016 equals: $18,741,483,300 2 The total assessed valuation for 2007 equals: $19,694,915,375 Source of Principal Property Taxpayer Listing: 3 Franklin County Auditor 4 Columbus Metropolitan Library's 2007 CAFR 87

158 Columbus Metropolitan Library Property Tax Levies and Collections, Last Ten Fiscal Years Collected within the Fiscal Year of the Levy Total Collections to Date Fiscal Year Taxes Levied Collections Ended for the Percentage in Subsequent Percentage December 31, Fiscal Year Amount of Levy Years Amount of Levy 2007 $20,423,141 $18,272, % $939,357 $19,212, % ,816,075 17,286, ,646 18,147, ,066,250 17,650, ,022 18,535, ,068,759 17,367, ,819 18,221, ,494,125 49,954, ,322,005 51,276, ,898,885 47,572, ,936,696 49,508, ,764,452 48,088, ,846,218 49,934, ,764,452 48,088, ,846,218 49,934, ,700,462 49,334, ,334, ,439,761 50,827, ,827, Source: Franklin County Auditor 88

159 Columbus Metropolitan Library Ratios of Outstanding Debt by Type Last Ten Fiscal Years General Special General Total Debt Fiscal Obligation Capital Assessment Obligation Outstanding Percentage of per Year Bonds (1) Leases Bonds Bonds Debt Personal Income (2) Population (3) Capital Business-Type Governmental Activities: Activities 2016 $ 87,779,068 $ - $ - $ - $ 87,779, % 1,252,492 $ ,674, ,674, % 1,251, ,596, ,596, % 1,231, ,504, ,504, % 1,212, ,411, ,411, % 1,180, % 1,171, % 1,163, % 1,130, % 1,126, % 1,130,253 - (1) Presented net of original issuance discounts and premiums and deferred amount on refunding (2) Personal income is disclosed in the table of Demographics and Economic Statistcs (3) Population is disclosed in the table of Demographics and Economic Statistcs 89

160 Columbus Metropolitan Library Ratios of General Bonded Debt Outstanding Last Ten Fiscal Years Percentage of Estimated General Less: Amounts Actual Taxable Fiscal Obligation Available in Debt Value of Per Year Bonds (1) Service Fund (2) Total Property (3) Capita 2016 $ 87,779,068 $ 961,467 $ 86,817, % $ ,674, ,175 89,703, % ,596, ,123 92,625, % ,504, ,891 95,533, % ,411, ,542 98,442, % % % % % % - (1) Presented net of original issuance discounts and premiums and deferred amount on refunding (2) Amount Restricted for debt service principal payments (3) Schedule of Assessed and Estimated Actual Value of Taxable Property 90

161 Columbus Metropolitan Library Direct and Overlapping Governmental Activities Debt As of December 31, 2016 Estimated Amount Debt Percentage Applicable to Government Unit: Outstanding Applicable Primary Government Direct Debt: Columbus Metropolitan Library $ 87,779, % $ 87,779,068 Total Direct Debt 87,779,068 87,779,068 Overlapping Debt: Franklin County 212,975, % 146,888,858 Canal Winchester City 4,900, % 4,317,107 Columbus City 1,139,785, % 914,791,441 Dublin City 27,555, % 23,071,802 Gahanna City 1,105, % 1,105,000 Grandview Heights City 9,125, % 2,738 Groveport City % - Hilliard City 18,785, % 18,785,000 New Albany City % - Reynoldsburg City 7,304, % 5,135,274 Whitehall City 2,615, % 2,615,000 Brice Village % - Lithopolis Village 564, % 25,215 Lockbourne Village % - Obetz Village 1,500, % 1,500,000 Valleyview Village % - Blendon Township 10,785, % 108,929 Brown Township % - Clinton Township 3,061, % 3,061,900 Franklin Township 627, % 41,603 Hamilton Township % - Jackson Township % - Jefferson Township 627, % 627,000 Madison Township % - Mifflin Township 825, % 825,000 Norwich Township % - Perry Township % - Plain Township 1,317, % 1,302,645 Pleasant Township % - Prairie Township 9,680, % 2,738,472 Sharon Township % - Truro Township % - Washington Township % - Columbus City School District 370,083, % 369,972,866 Dublin City School District 126,335, % 98,112,490 Gahanna-Jefferson City School District 6,680, % 6,680,805 Hilliard City School District 117,820, % 117,808,653 Reynoldsburg City School District 121,585, % 89,304,816 Upper Arlington City School District 16,144, % 264,777 Whitehall City School District 25,594, % 25,594,994 Canal Winchester L School District 51,410, % 37,725,157 Groveport Madison L School District 37,221, % 37,221,244 Hamilton L School District 17,912, % 17,912,269 Licking Heights L School District 48,454, % 24,551,966 New Albany-Plain L School District 91,560, % 91,550,889 Career & Tech Ed Ctr Licking Co (C-Tec) Jt. Voc. School 18,785, % 1,236,053 Eastland-Fairfield Career & Technical Jt. Voc. School 1,750, % 1,018,850 Tolles Career & Technical Center Jt. Voc. School District 710, % 491,675 Central Ohio Transit Authority Miscellaneous % - Metro Columbus-Franklin Co. Park Dist. Miscellaneous % - New Albany Community Authority Miscellaneous % - New Albany Plain Local Park District Miscellaneous 4,894, % 4,854,341 Rickenbacker Port Authority Miscellaneous % - Solid Waste Authority Of Central Ohio Miscellaneous 50,930, % 33,532,312 Westerville-Minerva Park Hospital Dist. Miscellaneous % - Total Overlapping Debt 2,561,012,742 2,084,777,139 Total $ 2,648,791,810 $ 4,018,348,314 Source: Ohio Municipal Advisory Council (OMAC) OMAC determined percentages by dividing each overlapping subdivision's assessed valuation within the Library by its total assessed valuation. 91

162 Columbus Metropolitan Library Demographic and Economic Statistics, Last Ten Calendar Years Per Capita Unemployment Rates (3) Personal Personal Median K-12 School Franklin State of United Year Population (1) Income (1) Income (1) Age (6) Enrollment County Ohio States ,127,174 43,119,641 38, ,394 (2) ,141,183 44,682,923 39, ,001 (2) ,155,408 43,749,144 37, ,675 (2) ,166,296 45,080,712 38, ,841 (2) ,180,069 48,854,609 41, ,597 (5) ,197,690 52,699,050 44, ,928 (5) ,215,200 53,291,536 43, ,254 (5) ,234,126 55,985,454 45, ,469 (5) ,251,722 58,767,410 46, ,341 (5) ,264,518 (4) 53,575,920 (4) 42,775 (4) ,963 (5) ,300,000 1,250,000 1,200,000 1,150,000 1,100,000 Population of Franklin County 1,050, Source: (1) Bureau of Economic Analysis. County-level per capita personal income and personal income totals available through from: State Profile. Ohio Woods & Poole Economics, Inc., Washington, D.C. *Woods and Poole forecasts from CDRom download of all projected data (2) Quality Education Data, Inc., School Guide (3) Bureau of Labor Statistics. Unemployment rates reflect non-seasonally adjusted annual average rates for each geography listed. (4) Franklin County population from the Census Population Estimate Program (5) MDR's school directory. Ohio. School Year Pgs OH B1-OH B7 (6) State Profile. Ohio Woods & Poole Economics, Inc., Washington, D.C. *Woods and Poole forecasts from CDRom download of all projected data Please note that in 2016, due to a change in source, prior year data was updated to be consistent with current year's presentation. 92

163 Columbus Metropolitan Library Principal Employers, Current Year and Ten Years Ago Percentage Percentage of Total County of Total County Employer Employees Rank Employment Employees Rank Employment The Ohio State University 29, % 20, % State of Ohio 23, % 26, % JPMorgan Chase Bank (formerly Bank One) 18, % 14, % OhioHealth 15, % 9, % Nationwide Mutual Insurance Co. 13, % 11, % Kroger Co. 10, % - Honda North America Inc 10, % 8, % Nationwide Children's Hospital 9, % - Mount Carmel Health System 8, % - City of Columbus 8, % 8, % Columbus City Schools 7, % 7, % Wal-Mart Stores Inc 7, % - L Brands Inc 7, % - Franklin County 6, % 6, % Huntington Bancshares Inc 5, % United States Federal Government , % Average County Employment for the Year 2 636, % 589, % Source: 1 Business First of Columbus, Book of Lists page Bureau of Labor Statistics Ohio - County data 3 Business First of Columbus, 2007 Top Employer List 93

164 Columbus Metropolitan Library Capital Asset Statistics by Branch Last Ten Fiscal Years The Columbus Metropolitan Library has 23 branch locations that service customers in Franklin County and the surrounding areas. Fiscal Year Canal Winchester (2016) Number of Registered Borrowers ,019 Volume Size (Collection) ,707 Circulation ,212 Driving Park (1973) Number of Registered Borrowers 5,139 4,655 5,257 7,037 7,703 7,909 7,909 10,994 13,770 12,151 Volume Size (Collection) 29,000 29,000 29,000 29,000 29,000 19,749 19,749 15,857 16,191 12,843 Circulation 106,594 93,618 76,985 71,019 71,081 72,689 64, , , ,477 Dublin (1981) Number of Registered Borrowers 33,365 33,483 37,667 44,431 48,584 50,100 50,100 57,680 61,302 43,403 Volume Size (Collection) 160, , , , , , , , , ,062 Circulation 1,630,425 1,739,138 1,713,453 1,534,438 1,558,342 1,575,547 1,580,264 1,776,859 1,798,694 1,665,073 Franklinton (1995) Number of Registered Borrowers 5,583 5,401 6,091 8,426 9,424 9,728 9,728 12,102 13,298 9,144 Volume Size (Collection) 33,000 33,000 33,000 33,000 33,000 25,764 25,764 11,635 11,816 12,231 Circulation 135, , , , , , , , , ,268 Gahanna (1991) Number of Registered Borrowers 32,833 32,481 36,400 43,462 47,165 48,213 48,213 54,137 57,638 39,513 Volume Size (Collection) 143, , , , , , , , , ,394 Circulation 1,263,524 1,353,457 1,338,952 1,199,784 1,174,913 1,166,464 1,162,482 1,310,011 1,352,935 1,220,983 Hilliard (1996) Number of Registered Borrowers 40,606 41,020 46,109 54,732 59,329 60,972 60,972 69,213 73,715 52,937 Volume Size (Collection) 170, , , , , , , , , ,473 Circulation 1,749,510 1,863,562 1,799,007 1,599,039 1,591,721 1,615,010 1,627,314 1,844,604 1,924,454 1,764,020 Hilltop (1996) Number of Registered Borrowers 24,490 23,426 25,821 32,924 36,023 37,136 37,136 44,634 48,144 32,141 Volume Size (Collection) 145, , , , , , ,462 43,056 64,641 63,473 Circulation 659, , , , , , , , , ,576 Karl Road (1988) Number of Registered Borrowers 32,282 31,009 34,478 42,691 46,272 47,197 47,197 55,223 59,921 40,645 Volume Size (Collection) 170, , , , , , ,018 85,226 84,242 72,856 Circulation 985, , , , , , , , , ,572 Linden (2004) Number of Registered Borrowers 10,438 9,714 10,973 14,881 16,107 16,482 16,482 20,317 22,435 16,437 Volume Size (Collection) 32,000 32,000 32,000 32,000 32,000 34,465 34,465 19,591 23,435 22,737 Circulation 175, , , , , , , , , ,403 Livingston (1992) Number of Registered Borrowers 15,192 13,976 15,597 19,834 21,162 21,213 21,213 25,368 27,071 18,628 Volume Size (Collection) 90,000 90,000 90,000 90,000 90,000 43,517 43,517 33,006 25,852 26,014 Circulation 281, , , , , , , , , ,705 Main Library (1901) Number of Registered Borrowers 78,846 79,331 90, , , , , , , ,471 **Volume Size (Collection) 928, , , , , , , ,936 94, ,767 *Circulation 3,041,972 2,898,452 1,971,498 1,778,524 2,093,716 2,678,357 2,961,532 3,530,770 3,016,427 3,299,311 Marion-Franklin (2014) Number of Registered Borrowers ,146 1,768 Volume Size (Collection) ,691 4,043 3,982 Circulation ,407 26,825 30,235 Martin Luther King (1969) Number of Registered Borrowers 5,402 5,203 5,932 7,770 8,445 8,589 8,589 10,402 11,511 8,500 Volume Size (Collection) 30,000 30,000 30,000 30,000 30,000 23,830 23,830 15,440 16,367 13,039 Circulation 143, , , , , , , , , ,618 94

165 Columbus Metropolitan Library Capital Asset Statistics by Branch Last Ten Fiscal Years Fiscal Year New Albany (2004) Number of Registered Borrowers 18,827 19,526 22,082 26,113 28,719 29,737 29,737 34,348 36,938 26,364 Volume Size (Collection) 120, , , , ,000 89,336 89,336 89,699 97,027 81,423 Circulation 935, , , , , , ,043 1,021,790 1,066,331 1,005,251 Northern Lights (1993) Number of Registered Borrowers 16,671 15,550 17,410 22,814 25,448 26,545 26,545 32,915 34,967 23,373 Volume Size (Collection) 72,000 72,000 72,000 72,000 72,000 51,524 51,524 48,578 25,819 37,975 Circulation 353, , , , , , , , , ,522 Northside (1991) Number of Registered Borrowers 13,521 13,081 15,149 19,565 21,490 21,781 21,781 25,532 27,212 14,205 Volume Size (Collection) 48,000 48,000 48,000 48,000 48,000 39,474 39,474 25,561 22,635 2,057 Circulation 506, , , , , , , , , ,090 Parsons (1956) Number of Registered Borrowers 8,074 7,552 8,393 11,294 12,377 12,819 12,819 15,187 16,420 12,026 Volume Size (Collection) 37,000 37,000 37,000 37,000 37,000 31,946 31,946 16,724 17,915 20,351 Circulation 178, , , , , , , , , ,088 Reynoldsburg (1981) Number of Registered Borrowers 39,573 38,766 42,774 52,323 56,726 57,744 57,744 65,561 70,673 44,778 Volume Size (Collection) 170, , , , , , ,247 93,047 88,082 81,747 Circulation 1,393,610 1,466,922 1,360,013 1,172,337 1,157,804 1,139,286 1,065,965 1,173,522 1,184,146 1,007,421 Shepard (1986) Number of Registered Borrowers 4,594 4,448 5,083 6,653 7,169 7,368 7,368 9,141 9,819 7,686 Volume Size (Collection) 33,000 33,000 33,000 33,000 33,000 20,188 20,188 15,634 14,707 17,254 Circulation 155, , , , , ,825 97, , , ,689 Southeast (2001) Number of Registered Borrowers 29,334 29,202 33,043 40,444 44,133 45,308 45,308 52,083 55,660 36,361 Volume Size (Collection) 112, , , , ,000 94,509 94,509 88,301 83,028 68,622 Circulation 977, , , , , , , , , ,839 South High (1992) Number of Registered Borrowers 13,968 13,536 15,234 19,190 20,882 21,311 21,311 24,673 27,827 17,851 Volume Size (Collection) 84,000 84,000 84,000 84,000 84,000 44,963 44,963 43,082 31,482 28,729 Circulation 329, , , , , , , , , ,454 Whetstone (1986) Number of Registered Borrowers 27,701 27,663 30,645 36,355 39,585 40,431 40,431 45,509 47,941 32,996 Volume Size (Collection) 170, , , , , , , , , ,885 Circulation 1,518,429 1,655,248 1,563,128 1,372,560 1,408,640 1,396,049 1,404,549 1,595,386 1,683,405 1,546,855 Whitehall (1959) Number of Registered Borrowers 14,523 14,196 16,162 20,140 21,802 22,339 22,339 26,359 30,114 22,343 Volume Size (Collection) 63,000 63,000 63,000 63,000 63,000 42,768 42,768 35,643 41,549 35,668 Circulation 409, , , , , , , , , ,386 *Main Library's circulation total also includes totals credited to Outreach, Inter-Library Loans (ILLs), Virtual Branch (E-Branch) and Library Partners ** Main Library was closed for renovations beginning March 2015 and the collection was placed in storage 95

166 Columbus Metropolitan Library Operation Indicators, Last Ten Fiscal Years Number of Number of Library Materials Registered Year Circulated Borrowers ,931, , ,404, , ,526, , ,822, , ,204, , ,808, , ,649, , ,043, , ,260, , ,099,048 (1) 626,740 (2) 20,000,000 Number of Library Materials Circulated 17,500,000 15,000,000 12,500,000 10,000, , , , , , , , , , , ,000 Number of Registered Borrowers (1) The decrease in circulation is due to branch closures due to renovations during the year. (2) The decrease in the number of registered borrowers is due to a data scrubbing project that removed inactive borrowers. 96

167 Columbus Metropolitan Library Employment Trend, Last Ten Fiscal Years Percentage of Number of Change Year Library Employees 1 Over Prior Year % % % % % % % % % % 820 Number of Library Employees (1) Includes full-time, part-time and part-time temporary employees 97

168 Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Independent Auditor's Report To Management and the Board of Trustees Columbus Metropolitan Library We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, the aggregate remaining fund information, and the discretely presented component unit of the Columbus Metropolitan Library, Franklin County, Ohio (the "Library") as of and for the year ended December 31, 2016 and the related notes to the financial statements, which collectively comprise the Library's basic financial statements, and have issued our report thereon dated May 25, Our report includes a reference to other auditors who audited the financial statements of the Columbus Metropolitan Library Foundation, as described in our report on the Columbus Metropolitan Library's financial statements. This report does not include the results of the other auditors testing of internal control over financial reporting or compliance and other matters that are reported on separately by those auditors. The financial statements of the Columbus Metropolitan Library Foundation were not audited in accordance with Government Auditing Standards. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the Columbus Metropolitan Library's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Library's internal control. Accordingly, we do not express an opinion on the effectiveness of the Library's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. 98

169 To Management and the Board of Trustees Columbus Metropolitan Library Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Compliance and Other Matters As part of obtaining reasonable assurance about whether the Columbus Metropolitan Library's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Library's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Library's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. May 25,

170 COLUMBUS METROPOLITAN LIBRARY 96 South Grant Avenue, Columbus, Ohio