LINCOLN LAND COMMUNITY COLLEGE COMMUNITY COLLEGE DISTRICT #526 SPRINGFIELD, ILLINOIS COMPREHENSIVE ANNUAL FINANCIAL REPORT

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1 SPRINGFIELD, ILLINOIS COMPREHENSIVE ANNUAL FINANCIAL REPORT Fiscal Years Ended June 30, 2014 and 2013 Prepared by: Administrative Services Office Todd McDonald Vice President Administrative Services

2 SPRINGFIELD, ILLINOIS TABLE OF CONTENTS Page(s) INTRODUCTORY SECTION Letter of Transmittal... Principal Officials... Chart of Organization... ASBO Certificate of Excellence in Financial Reporting... i-vi vii viii ix FINANCIAL SECTION INDEPENDENT AUDITOR S REPORT MANAGEMENT S DISCUSSION AND ANALYSIS... MD&A 1-6 BASIC FINANCIAL STATEMENTS Statements of Net Position Statements of Revenues, Expenses and Changes in Net Position... 6 Statements of Cash Flows Discretely Presented Component Unit Lincoln Land Community College Foundation Statements of Financial Position... 9 Statements of Activities Notes to Financial Statements INDEPENDENT AUDITOR S REPORT ON SUPPLEMENTARY INFORMATION SUPPLEMENTARY INFORMATION Combining Schedules of Net Position Accounts, by Subfund Combining Schedules of Revenues, Expenses and Changes in Net Position, by Subfund Notes to Supplementary Information STATISTICAL SECTION Financial Trends Net Position by Component Changes in Net Position Revenue Capacity Assessed Value and Estimated Actual Value of Taxable Property Property Tax Rates Direct and Overlapping Governments Principal Taxpayers

3 SPRINGFIELD, ILLINOIS TABLE OF CONTENTS Continued Page(s) STATISTICAL SECTION Continued Revenue Capacity Continued Property Tax Rates, Extensions, and Collections Debt Capacity Ratio of Outstanding Debt by Type Ratio of Net General Bonded Debt Outstanding Legal Debt Margin Computation of Direct and overlapping Bonded Debt, General obligation Bonds Demographic and Economic Information Demographic and Economic Statistics Major Employers Operating Information Operating Information and Employees Operating Statistics Capital Asset Statistics Student Enrollment Demographic Statistics SPECIAL REPORTS SECTION SUPPLEMENTAL FINANCIAL INFORMATION Certification of Chargeback Reimbursement UNIFORM FINANCIAL STATEMENTS Uniform Financial Statement No. 1 All Funds Summary Uniform Financial Statement No. 2 Summary of Capital Assets and Fixed Debt Uniform Financial Statement No. 3 Operating Revenues and Expenditures Uniform Financial Statement No. 4 Restricted Purposes Fund Revenues and Expenditures Uniform Financial Statement No. 5 Current Fund - Expenditures by Activity

4 SPRINGFIELD, ILLINOIS TABLE OF CONTENTS Continued SPECIAL REPORTS SECTION Continued Page ILLINOIS COMMUNITY COLLEGE BOARD STATE GRANTS FINANCIAL COMPLIANCE SECTION Independent Auditor s Report State Adult Education and Family Literacy Program Balance Sheet Statement of Revenues, Expenditures and Changes in Fund Balance Expenditure Amounts and Percentages for ICCB Grant Funds Only Career and Technical Education Program Improvement Grant Program Balance Sheet Statement of Revenues, Expenditures and Changes in Fund Balance Notes to Financial Statements State Grant Programs Independent Accountant s Report on the Schedule of Enrollment Data and Other Bases Upon Which Claims are Filed Schedule of Enrollment Data and Other Bases Upon Which Claims are Filed Reconciliation of Total Semester Credit Hours Documentation of Residence Verification Steps (Unaudited) Summary of Assessed Valuation (Unaudited)... 99

5 INTRODUCTORY SECTION

6 October 9, 2014 To the Board of Trustees Lincoln Land Community College Community College District #526 Springfield, IL The Comprehensive Annual Financial Report of Lincoln Land Community College District #526 (District), County of Sangamon, State of Illinois, for the fiscal year ended June 30, 2014, is hereby submitted. Responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with the District. To the best of our knowledge and belief, the enclosed data is accurate in all material respects and is reported in a manner designed to present fairly the financial position and results of operations of the District. All disclosures necessary to enable the reader to gain an understanding of the District s financial activities in relation to its mission have been included. The Comprehensive Annual Financial Report is presented in four sections: introductory, financial, statistical and special reports. The introductory section includes this transmittal letter, the District s principal officials and an organization chart. The financial section includes the report of independent accountants, the management s discussion and analysis, basic financial statements, the notes to financial statements and supplemental financial information. The statistical section includes selected unaudited financial and demographic information, generally presented on a multi-year basis. The special reports section includes Uniform Financial Statements, Certificate of Chargeback reimbursement, grant financial statements and enrollment schedules required by the Illinois Community College Board (ICCB), together with the related auditors reports. The District Management s Discussion and Analysis letter is presented to provide an analytical review of the past two fiscal years. Established in 1967, Lincoln Land Community College is a comprehensive two-year public community college that serves approximately 339,605 residents and stretches nearly 4,115 square miles, covering all or part of a 15 county area in Central Illinois. The mission of Lincoln Land Community College is to improve the lives of district residents by providing quality educational programs and services that are accessible and affordable to individuals and responsive to individual and community needs. Included herein are: Programs leading to certificates and occupational and transfer degrees, Workforce training and economic development, College preparatory, continuing and adult education, and Community-based programs and services. i

7 It was through the following institutional goals for fiscal year 2014 that the District carried out its mission: Goal I Student Access and Success The District is committed to promoting academic access and success as well as personal development for all students. Goal II Financial Strength The District is committed to fiscal responsibility and stewardship. Goal III Economic Responsiveness The District is committed to providing leadership in meeting the economic needs of the community. Goal IV Community Engagement The District is committed to providing leadership in meeting the learning, cultural, social and recreational needs of the community. Goal V Diversity and Cultural Competency The District is committed to strengthening cultural competency relative to a diverse and global society among faculty, staff and students. Goal VI Operational Strength The District is committed to developing a work environment that promotes growth, development and open communication. The District is committed to ensuring educational excellence, recognizing diversity and multiculturalism, providing excellent facilities, using financial resources prudently and building partnerships to extend services to the District. Lincoln Land Community College serves approximately 13,800 students per year with an average age of 27. The students are comprised of 85.08% White Non-Hispanic, 10.23% African- American, 2.72% Hispanic, and the remaining 1.97% Asian and other. These statistics are based on end-of-year credit enrollment data. The District maintains its accounts and prepares its financial statements in accordance with accounting principles generally accepted in the United States of America (GAAP) as applied to governmental entities. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The accounting policies also conform to the Fiscal Management Manual published by the Illinois Community College Board. The ICCB requires accounting by funds in order that limitations and restrictions on resources can be easily monitored. The financial records of the District are maintained on the accrual basis of accounting, whereby all revenues are recorded when earned, and all expenses are recorded when they have been reduced to a legal obligation to pay. ii

8 ECONOMIC CONDITION AND OUTLOOK The District serves an area of approximately 4,115 square miles, which includes all or parts of the following counties Bond, Cass, Christian, DeWitt, Fayette, Greene, Logan, Macon, Macoupin, Mason, Menard, Montgomery, Morgan, Sangamon and Scott. The District draws students from communities large and small, from farms and urban areas, and from a broad range of ages, occupations, interests and needs. The District s tax base within Sangamon County is estimated to be: 68.85% residential, 5.78% farm,.30% industrial,.06% mineral, and 25.01% commercial. The total tax base amounts to $5,780,057,817 and has increased by 1.36% since last year. Student enrollment projections for FY15 are being projected at an 8% decrease from last year. MAJOR INITIATIVES FOR THE YEAR: LLCC s accreditation is reaffirmed AQIP (Academic Quality Improvement Program) is the method chosen by LLCC to maintain accreditation with the Higher Learning Commission. The AQIP steering team is headed by Drs. Chris McDonald and Tricia Kujawa. Following a four-year intensive process involving hundreds of faculty and staff, the Higher Learning Commission s Institutional Actions Council reaffirmed LLCC s accreditation. AQIP involves a summative review of work that includes a systems portfolio, completed action projects systems appraisal feedback reports, interactions with AQIP and the Higher Learning Commission, quality checkup reports and compliance with accreditation criteria. AQIP institutions must always have at least three action projects underway with at least one project dealing directly with student learning. Action projects underway include: 1) the electronic portfolio project to enhance the assessment and documentation of student learning outcomes at the program level, 2) process mapping: systematic documenting of key processes to design and recommend a process mapping model that may be applied to processes throughout the college, and 3) using multiple measures for placement into mathematics courses to examine the college s process for initial academic placement into mathematics courses. LLCC Foundation hits $1-million milestone with Grow Beyond campaign Through the help of generous community friends, LLCC alumni, faculty and staff, the LLCC Foundation surpassed the $1 million milestone in the Grow Beyond endowment fund campaign since its kickoff in September The $2.5 million campaign is expected to continue through 2017, the college s 50th anniversary. The annual earnings from the Foundation endowment fund provide vital financial resources for scholarships and direct student support, instructional excellence, and programs and supporting activities. LLCC adds new workforce certificate programs with assistance from TAACCCT grant initiative LLCC added a value-added local food certificate program that begins in fall 2014, in addition to a Green Facilities Management program that will begin in spring These sustainabilityfocused programs were funded through the Illinois Green Energy Network/Trade Adjustment Assistance Community College and Career Training (TAACCCT) grant. Additionally, Industrial Maintenance Technology and Mechatronics programs through the Illinois Network for Advanced iii

9 Manufacturing Earn and Learn/TAACCCT grant are being reviewed in October 2014, with classes expected to begin in spring Workforce training courses that began in spring 2014 include Certified Logistics Associate (CLA) and Certified Logistics Technician (CLT). FOR THE FUTURE: LLCC-Taylorville building project Renovation is being done to the 40-year-old administrative and classroom building at LLCC- Taylorville. Renovations will include new energy-efficient windows and doors, roofing and exterior walls. Inside, the classrooms, offices, student space, and restrooms will be updated with improved accessibility. The finished project will complement the classroom building constructed next door at LLCC-Taylorville in The renovation is expected to be completed in August AQIP continues faculty and staff to participate in AQIP Strategy Forum LLCC is participating in a three-day AQIP strategy forum in November Four members from the Higher Learning Commission (HLC) will facilitate the forum on the Springfield campus. The strategy forum is a structure of the AQIP pathway designed to organize the institution for the next four-year cycle of improvement. The purpose of the forum is to develop a tentative improvement agenda for the college. Five potential action projects will be taken to the three-day event for further vetting and development: understanding the needs of our external stakeholders; training supervisors/sustaining quality systems at LLCC; structuring the student employment process; aggregating student learning outcomes at an institutional level; and guided pathways for students. Of those five, potential action projects, one must be launched as an action project within six weeks of completing the strategy forum. The first day the entire campus community will participate. On days two and three, smaller groups will participate and focus on developing the potential action projects. Student Services to review and redesign admission process A review and redesign of the admission process is taking place in This will include capturing the current state of existing process; reviewing system functionality; realigning the process to capture unused system functionality; and training staff regarding new/revised processes and system use. FINANCIAL INFORMATION Internal Controls. Management of the District is responsible for establishing and maintaining internal controls designed to ensure that the assets of the District are protected from loss, theft or misuse and to ensure that adequate accounting data are compiled to allow for the preparation of financial statements in conformity with accounting principles generally accepted in the United States of America. The internal controls are designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that: (1) the cost of a control should not exceed the benefits likely to be derived; and (2) the evaluation of costs and benefits requires estimates and judgments by management. Tests are made by the District s independent auditors to determine the adequacy of the internal controls, including that portion related to federal financial assistance programs, as well as to determine that the District has complied with applicable laws and regulations. No findings were presented in the Comprehensive Annual Financial Report. Budgetary Controls. In addition, the District maintains budgetary controls. The objective of the budgetary controls is to ensure compliance with legal provisions embodied in the annual iv

10 appropriated budget approved by the District s Board of Trustees. Activities of the funds are included in the annual appropriated budget. The level of budgetary control (that is the level at which expenditures cannot legally exceed the appropriated amount) is established within each individual fund. The District also maintains an encumbrance accounting system as a technique of accomplishing budgetary control. The actual revenues compared to budget for the Operating Funds were more than budget by $418,372. The actual expenditures compared to budget for the General Fund were less than budget by $577,341. These numbers do not reflect transfers to other funds. Debt Administration. During fiscal year 2009 the District sold $35,200,000 in debt certificates which were paid in full February 1, 2009 with the proceeds from $34,970,000 General Obligation Bond Series 2008A issue. The District is responsible for making semi-annual payments of interest which are due June 15 and December 15 and principal payments which are due annually each December 15. The principal payments will vary starting at $550,000 in 2009 and ending with $3,580,000 in The interest rate also varies from 3.00% in 2009 and ends at 5.00% in During fiscal year 2001 the District entered into a lease agreement with the Lincoln Land Community College Foundation. The Foundation sold $3,150,000 of Economic Development Revenue Bonds and the District is responsible for making semi-annual payments to the Foundation, which are due each September 1 and March 1. The payments will vary starting at $138, in 2001 and ending at $141, in 2020 with interest rates varying from 5.90% to 6.34%, the payments include both principal and interest. During fiscal year 2013 the District entered into a 7-year note for Energy Conservation Projects. The District is responsible for quarterly principal payments of $42,857 at a rate of 1.85% interest. Cash Management. For the purpose of overall investment of excess funds, the District is governed by the Illinois Public College Act, and the statutes governing investment of public funds of the Illinois Revised Statutes (Chapter et. Seq.) The fiduciary responsibility for said investments is entrusted to the District s Board of Trustees, who have delegated that function to the Treasurer of the District. In keeping with existing Board policy, all investments of excess funds are made in a prudent conservative and secure manner and in accordance with the guidelines detailed in the District Investment Policy No 6.8. The investment income for all funds totaled $223,889 in fiscal year The average rate of return was.04% to.75% depending on the depository account for fiscal year As of June 30, 2014, investments were at United Community Bank and the Illinois Funds. RISK MANAGEMENT The District participates in the Illinois Community College Risk Management Consortium (Consortium), which was established in 1981 by several Chicago area community colleges as a means of reducing the cost of general liability insurance. The Consortium is a public entity risk pool currently operating as a common risk management and insurance program for the member colleges. The main purpose of the Consortium is to jointly self-insure certain risks up to an agreed-upon retention limit, and to obtain excess catastrophe coverage and aggregate stop-loss reinsurance over the selected retention limit. In 1992, the Consortium added Worker s Compensation coverage. In fiscal year 2014, the District paid $497,795 to the Consortium for property, liability and worker s compensation protection. Since the Consortium requests initial payments to cover substantially any losses to be incurred for the policy year, the District anticipates no future liabilities for incurred losses. v

11 The District has established a two-tier self-insurance health insurance plan administered by a third party. The District maintains adequate reserves to cover potential losses. OTHER INFORMATION Awards/Recognitions. The District has continued to receive the Certificate of Excellence in Financial Reporting from the Association of School Business Officials for each fiscal year beginning with the fiscal year that ended June 30, Independent Audit. The Illinois Public Community College Act requires an annual audit of the books of accounts, financial records and transactions of all funds of the District. The audit is done by independent certified public accountants that are selected by the Board of Trustees. This requirement has been complied with and the auditing firm has issued an unmodified opinion. ICCB Recognition Visit. The Illinois Community College Board conducted a five-year recognition visit in April Their report contained one compliance and several advisory recommendations. Acknowledgments. The preparation of this report in a timely manner would not have been possible without the dedicated service of the entire staff of the Finance Office. Each member of the department has our sincere appreciation for the contributions made in the preparation of this report. We thank the Board of Trustees for their continued interest and support in planning and conducting the financial operations of the District in a highly responsible and accountable manner and with fiscal integrity. Contact Information. This financial report has been prepared in the spirit of full disclosure to provide the reader with an overview of the District's financial operations. If the reader has questions or would like additional information about the District, please direct the request to the Associate Vice President of Finance at 5250 Shepherd Road, Springfield, Illinois Respectfully submitted, VI

12 PRINCIPAL OFFICIALS Year Ended June 30, 2014 Board of Trustees Position Term Expires Justin Reichert Chair 2019 Craig Findley Vice Chair 2017 Jerry Wesley Secretary 2017 Kent Gray Trustee 2017 Wayne Rosenthal Trustee 2019 Jeff Fulgenzi Trustee 2017 Dennis Shackelford Trustee 2019 Jefferson Gentry Student Trustee 2015 Officers of the College Charlotte J. Warren Todd McDonald Eileen Tepatti Lesley Frederick Judy Joziatis Esteban Cruz Lynn Whalen President Vice President, Administrative Services Vice President, Academic Services Vice President, Student Services Vice President, Workforce Development Chief Information Officer Executive Director, College Relations/Marketing Official Issuing Report Richard W. Vertrees Vice President, Administrative Services (Retired April 30, 2014) Todd McDonald Vice President, Administrative Services (Started May 27, 2014) Mary McGee Associate Vice President, Budget, Financial Planning & Analysis (Retired September 30, 2013) Karie Longhta Associate Vice President of Finance Division Issuing Report Administrative Services vii

13 viii

14 Association of School Business Officials International The Certificate of Excellence in Financial Reporting Award is presented to Lincoln Land Community College For Its Comprehensive Annual Financial Report (CAFR) For the Fiscal Year Ended June 30, 2013 The CAFR has been reviewed and met or exceeded ASBO International s Certificate of Excellence standards Terrie S. Simmons, RSBA, CSBO President John D. Musso, CAE, RSBA Executive Director ix

15 FINANCIAL SECTION

16 INDEPENDENT AUDITOR S REPORT To the Board of Trustees Lincoln Land Community College Community College District #526 Springfield, Illinois Report on the Financial Statements We have audited the accompanying basic financial statements of Lincoln Land Community College, Community College District #526 (the District) as of and for the years ended June 30, 2014 and 2013, and the related notes to the financial statements, which collectively comprise the District 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 an opinion on these basic financial statements based on our audit. We did not audit the financial statements of the Lincoln Land Community College Foundation, the discretely presented component unit. Those 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 discretely presented component unit, is based solely on the report of the other auditors. We conducted our audits in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The financial statements of the Lincoln Land Community College Foundation were not audited in accordance with 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 - 1 -

17 statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, based on our audit and the report of other auditors, the basic financial statements referred to above present fairly, in all material respects, the respective financial position of the District, and the District s discretely presented component unit, Lincoln Land Community College Foundation as of June 30, 2014 and 2013, and the changes in financial position and cash flows thereof for the years then ended in accordance with accounting principles generally accepted in the United States of America. Emphasis of Matter As discussed in Note 10M of the financial statements, the discretely presented component unit, Lincoln Land Community College Foundation, has elected to change its method of accounting regarding valuation of land held for investment during the year ended June 30, The report of the other auditors was not modified with respect to this matter. Retrospective Adjustment As discussed in Note 11 to the financial statements, the District has adjusted its fiscal year 2013 financial statements to retrospectively apply the correction of an error relating to activity incorrectly included in the agency fund. Our opinion is not modified with respect to this matter. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis as listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance

18 Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated October 9, 2014, on our consideration of the District's internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District s internal control over financial reporting and compliance. Springfield, Illinois October 9,

19 Management s Discussion and Analysis This section of Lincoln Land Community District s Comprehensive Annual Financial Report presents management s discussion and analysis of the District s financial activity during the fiscal year ended June 30, 2014, 2013 and Since this management s discussion and analysis is designed to focus on current activities, resulting change and currently known facts, please read it in conjunction with the transmittal letter (pages i-vi), the District s basic financial statements (pages 4-11) and the footnotes (pages 12-33). Responsibility for the completeness and fairness of this information rests with the District. Using This Annual Report The financial statement focuses on the District as a whole. The Management, Discussion and Analysis letter is presented in comparison form. The District financial basic statements (see pages 4-33) are designed to emulate corporate presentation models whereby all District activities are consolidated into one total. The focus of the Statements of Net Position is designed to be similar to bottom line results for the District. This statement combines and consolidates current financial resources (short-term spendable resources) with capital assets. The Statements of Revenues, Expenses, and Changes in Net Position focus on both the gross costs and the net costs of District activities, which are supported by property taxes, student tuition and fees and state revenues. This approach is intended to summarize and simplify the user s analysis of cost of various District services to students and the public. Financial Highlights As of June 30, 2014, 2013 and 2012, the District s net positions were $68,200,985, $66,507,867 and $63,708,584 of which 48.1%, 50.6% and 55.5%, respectively, represents the net investment in capital assets. Unrestricted resources were 19.1%, 18.6% and 14.4%, of total net position. The restricted resources were 32.8%, 30.8% and 30.1%, in 2014, 2013 and 2012 respectively. The Districts current assets totaled $60,683,247, $59,509,868 and $58,141,022. Cash and cash equivalents represent 51.2%, 47.1% and 39.0% of the total current assets. Total liabilities and deferred inflows of resources are $59,565,269, $60,674,114 and $61,593,831 for 2014, 2013 and 2012 respectively; 43.9%, 42.5% and 43.0% current liabilities and deferred inflows of resources and 56.1%, 57.5% and 57.0% are non-current liabilities. Total operating expenses at June 30, 2014, 2013 and 2012 were $73,169,289, $72,424,546 and $69,702,532. Instruction represents 33.9%, 33.6% and 32.4% of the total expenses. Academic Support and Student Services represented 22.2%, 22.5% and 24.4% of the total costs. Institutional support represented the next largest cost category at 18.9%, 19.1% and 18.1% of the total operating expenses. Fiscal year 2014, 2013 and 2012 depreciation was $3,295,514, $3,187,886 and $2,506,335; 4.5%, 4.4% and 3.6% of the total costs. Total operating revenues at June 30, 2014, 2013 and 2012 were $15,015,498, $15,952,827 and $15,535,588. Student tuition and fees represent 62.5%, 61.1% and 64.0%; while auxiliary enterprise revenue represents 33.5%, 33.2% and 33.6% of the total operating revenues. MD&A - 1 -

20 Net non operating revenue totaled $59,846,909, $58,918,116 and $55,927,019 respectively. The increase in fiscal year 2013 non-operating revenues relates to the increase SURS on behalf payments. Property taxes represent 47.6%, 46.4% and 47.8%, while state and federal grant and contracts represents 55.0%, 55.0% and 53.2% of the total non-operating revenue. The District has continually monitored their revenue stream and expenses and due to the consolidated effort of the District s administration, the District continues to maintain a healthy financial position. Financial Analysis of the District as a whole: Net Position as of June 30, (in millions) Current and Other Assets $60.7 $59.5 $58.2 Capital Assets $67.0 $67.7 $67.1 Total Assets $127.7 $127.2 $125.3 Current Liabilities $13.3 $12.5 $13.5 Long-Term Liabilities $32.5 $34.9 $35.1 Deferred Inflows of Resources $13.7 $13.3 $13.0 Total Liabilities and Deferred Inflows of Resources $59.5 $60.7 $61.6 Net Position Net Investment in Capital Assets $32.8 $33.6 $35.3 Restricted $22.3 $20.5 $19.2 Unrestricted $13.1 $12.4 $ 9.2 Total Net Position $68.2 $66.5 $63.7 This schedule is prepared from the District s Statement of Net Position (pages 4-5) which is presented on an accrual basis of accounting; whereby, assets are capitalized and depreciated. There were no major changes between the three fiscal years presented. The District is currently reducing their long term debt without taking on any additional liabilities. The changes between Current and Other Assets and Capital Assets are minor between the three years. All but one of the capital projects relating to the FY09 $34,970,000 Bond issue have been capitalized and are being depreciated. MD&A - 2 -

21 The following is a graphic illustration of Net Position: Net Position Investment in Capital Assets Restricted Unrestricted Operating Results for the year Ended June 30, (in millions) Operating Revenue Tuition and Fees $9.5 $9.7 $9.9 Auxiliary $5.0 $5.3 $5.2 Other $0.6 $0.9 $0.4 Total $15.1 $15.9 $15.5 Less Operating Expenses $73.2 $72.4 $69.7 Net Operating Expenses ($58.1) ($56.5) ($54.2) Non-operating Revenue Property Taxes $28.4 $27.4 $26.7 State Grants and Contracts $16.0 $15.7 $12.5 Federal and Local Grants & Contracts $16.9 $16.6 $17.3 Investment Income $0.2 $0.2 $0.2 Interest Expense ($1.7) ($1.6) ($0.5) Other Non-operating Revenues (Expenses) $0.0 $0.7 ($0.0) Loss on disposal ($0.0) ($0.0) ($0.2) Total $59.8 $59.0 $56.0 MD&A - 3 -

22 Operating Results for the year Ended June 30, (in millions) Continued Increase Before Contributions $1.7 $2.5 $1.8 Contributions $0.0 $0.0 $0.0 Increase in Net Position $1.7 $2.5 $1.8 Net Position, Beginning of Year $66.5 $63.6 $61.9 Prior Period Adjustment (0.0) Net Position, Beginning of Year, Restated $66.0 $64.0 $61.9 Net Position, End of Year $68.2 $66.5 $63.7 The District received contributions from the State Universities Retirement System of $10,644,621, $10,069,863 and $7,032,466 for years ending June 30, 2014, 2013, and 2012, respectively. The increase in contributions from the State Universities Retirement System in 2013 was due to the State of Illinois contributing funds for previous fiscal years, which is reflected in non-operating revenues, state grants and contracts. Under non-operating revenue, the increase in 2013 interest expense is due to interest on bond projects being capitalized in The financial statements reflect a prior period adjustment in 2013 for an accounting change to the agency fund. The following is a graphic illustration of Revenues by Source: Revenue by Source Tuition and Fees Auxiliary Other Property Taxes State Grants and Contracts MD&A - 4 -

23 Operating Expenses for the Year Ended June 30, (in millions) Operating Expense Instruction $24.8 $24.4 $22.6 Academic Support $5.6 $5.9 $5.4 Student Services $10.6 $10.5 $11.7 Public Service $2.3 $2.2 $1.9 Auxiliary services $1.1 $1.0 $0.6 Institutional Support $13.9 $13.8 $12.6 Operations & Maintenance Plant $5.4 $5.1 $6.4 Tuition Chargeback $0.1 $0.1 $0.0 Auxiliary enterprises $6.1 $6.2 $6.0 Depreciation $3.3 $3.2 $2.5 Other $0.0 $0.0 $0.0 Total $73.2 $72.4 $69.7 Included in the Institutional Support cost was the FY14 and FY13 write off of Illinois Veteran grants, Illinois National Guard grants and MIA-POW grants. The following is a graphic illustration of Operating Expenses: Operating Expenses Instruction Academic Support Student Services Public Service Auxiliary services Institutional Support Operations & Maintenance Plant Tuition Chargeback MD&A - 5 -

24 Capital Assets, Net June 30, Capital Assets Land and Improvements $13.9 $12.9 $12.6 Building $80.4 $79.0 $75.9 Technology $2.2 $2.2 $2.2 Equipment $8.3 $8.0 $8.1 Total $104.8 $102.1 $98.8 Less Accumulated Depreciation $39.3 $36.1 $33.1 Net Capital Assets $65.5 $66.0 $65.7 Construction in Progress $1.5 $1.7 $1.4 Current year additions net of depreciation amounted to $3,295,514, $3,187,886, and $2,506,335 for years ending June 30, 2014, 2013, and For further detail see footnote 5 on Capital Assets page 24. General Long-term Debt June 30, Leases Payable $2.4 $2.8 $3.2 Notes Payable $1.0 $1.2 $0.1 Bonds Payable $31.4 $32.3 $33.0 Bond discount ($0.3) ($0.3) ($0.3) Compensated Absences $1.2 $1.1 $1.0 Total $35.7 $37.1 $37.0 The current portion of the general long-term debt due within the next twelve months is $3,165,442, for further details see footnote 4 long-term debt pages The increase in notes payable in FY13 represents a 7-year note for an energy construction project. Requests for Information This financial report has been prepared in full disclosure to provide the reader with an overview of the District s financial operations. If the reader has questions or would like additional information about the District, please direct the request to the Associate Vice President of Finance, 5250 Shepherd Road, P.O. Box 19256, Springfield, IL MD&A - 6 -

25 BASIC FINANCIAL STATEMENTS

26 SPRINGFIELD, ILLINOIS STATEMENTS OF NET POSITION June 30, 2014 and ASSETS CURRENT ASSETS Cash, cash equivalents and investments $ 31,065,436 $ 28,027,564 Restricted cash 1,512,468 3,755,183 Accounts receivable: Property taxes 18,440,864 17,994,562 Government claims 2,415,115 2,711,038 Student tuition and fees 5,716,862 5,810,618 Other receivables, net 854, ,588 Prepaid expenses 101,267 8,000 Inventories 576, ,315 Total current assets 60,683,247 59,509,868 NONCURRENT ASSETS Land 514, ,354 Construction-in-progress 1,559,794 1,712,544 Depreciable capital assets, net of accumulated depreciation 65,008,859 65,445,215 Total non-current assets 67,083,007 67,672,113 Total assets 127,766, ,181,981 (continued) See accompanying notes to financial statements

27 SPRINGFIELD, ILLINOIS STATEMENTS OF NET POSITION June 30, 2014 and LIABILITIES CURRENT LIABILITIES Accounts payable $ 1,009,726 $ 1,294,522 Accrued expenses 1,554,726 1,371,003 Claims payable 275, ,000 Other liabilities 499, ,680 Interest payable 124, ,184 Unearned student tuition and fees 6,656,380 6,730,057 Unearned revenue 49, ,009 Bonds, contracts and leases payable 2,342,751 2,415,233 Compensated Absences 822, ,406 Total current liabilities 13,334,275 13,483,094 NON-CURRENT LIABILITIES Bonds, contracts and leases payable 32,202,228 33,560,473 Compensated absences 345, ,337 Total non-current liabilities 32,547,760 33,888,810 Total liabilities 45,882,035 47,371,904 DEFERRED INFLOWS OF RESOURCES Deferred property taxes 13,683,234 13,302,210 Total deferred inflows of resources 13,683,234 13,302,210 NET POSITION Net investment in capital assets 32,837,561 33,652,593 Restricted for capital projects 6,041,183 5,012,291 Restricted for debt service 434, ,853 Restricted for grant purposes 746, ,592 Restricted for audit purposes 81,932 70,999 Restricted for liability insurance 2,531,034 1,818,441 Restricted for working cash 12,500,000 12,500,000 Unrestricted 13,028,352 12,410,098 TOTAL NET POSITION $ 68,200,985 $ 66,507,867 (concluded) See accompanying notes to financial statements

28 SPRINGFIELD, ILLINOIS STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN NET POSITION For the Years Ended June 30, 2014 and OPERATING REVENUES Student tuition and fees, tuition chargebacks, net of scholarship allowances $ 9,384,917 $ 9,749,571 Auxiliary enterprise revenue 5,030,536 5,288,624 Facilities revenue 31,276 19,547 Other operating revenue 568, ,085 Total operating revenues 15,015,498 15,952,827 OPERATING EXPENSES Instruction 24,804,252 24,394,445 Academic support 5,668,024 5,857,675 Student services 10,634,392 10,468,298 Public services 2,305,251 2,224,523 Auxiliary services 1,067, ,270 Institutional support 13,850,639 13,865,194 Operation and maintenance of plant 5,360,388 5,165,514 Tuition chargebacks 68,428 43,700 Auxiliary enterprise 6,115,386 6,268,041 Depreciation 3,295,514 3,187,886 Total operating expenses 73,169,289 72,424,546 OPERATING INCOME (LOSS) (58,153,791) (56,471,719) NON-OPERATING REVENUES (EXPENSES) Property taxes and corporate personal property replacement taxes 28,480,731 27,359,604 State grants and contracts 16,032,161 15,749,962 Federal grants and contracts 16,851,503 16,647,270 Investment earnings 223, ,422 Interest expense (1,697,660) (1,649,756) Other non-operating revenues (expenses) (14,248) 656,943 Loss on disposal of assets (29,464) (20,329) Total non-operating revenues (expenses) 59,846,909 58,918,116 CHANGE IN NET POSITION 1,693,118 2,446,397 NET POSITION - BEGINNING OF YEAR 66,507,867 63,605,890 PRIOR PERIOD ADJUSTMENT - 455,580 NET POSITION - BEGINNING OF YEAR, AS RESTATED 66,507,867 64,061,470 NET POSITION - END OF YEAR $ 68,200,985 $ 66,507,867 See accompanying notes to financial statements

29 SPRINGFIELD, ILLINOIS STATEMENTS OF CASH FLOWS For the Years Ended June 30, 2014 and CASH FLOWS FROM OPERATING ACTIVITIES Tuition and fees $ 9,404,996 $ 10,028,163 Payments to employees (29,261,112) (29,285,295) Payments to suppliers (30,042,062) (29,931,467) Auxiliary enterprise charges 5,030,536 5,288,624 Other receipts 328, ,035 Net cash from operating activities (44,538,917) (43,067,940) CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES State grants and contracts 5,340,962 6,367,992 Federal grants and contracts 17,194,004 16,655,230 Property taxes and corporate personal property replacement taxes 28,415,453 27,800,906 Other receipts - 670,606 Net cash from non-capital financing activities 50,950,419 51,494,734 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES: Purchases of capital assets (2,697,596) (3,696,732) Note proceeds - 1,200,000 Principal paid on bonds, contracts and leases (1,444,975) (1,205,206) Interest paid on bonds, contracts and leases (1,697,660) (1,649,756) Net cash from capital and related financing activities (5,840,231) (5,351,694) CASH FLOWS FROM INVESTING ACTIVITIES Interest on investments 223, ,422 Net cash from investing activities 223, ,422 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 795,157 3,249,522 CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR 31,782,747 28,533,225 CASH AND CASH EQUIVALENTS - END OF YEAR $ 32,577,904 $ 31,782,747 CASH AND CASH EQUIVALENTS Cash and cash equivalents $ 31,065,436 $ 28,027,564 Restricted cash 1,512,468 3,755,183 TOTAL CASH AND CASH EQUIVALENTS $ 32,577,904 $ 31,782,747 See accompanying notes to financial statements. (continued) - 7 -

30 SPRINGFIELD, ILLINOIS STATEMENTS OF CASH FLOWS For the Years Ended June 30, 2014 and RECONCILIATION OF OPERATING LOSS TO NET CASH FROM OPERATING ACTIVITIES Operating loss $ (58,153,791) $ (56,554,445) Adjustments to reconcile operating loss to net cash from operating activities: Depreciation 3,295,514 3,187,886 On-behalf SURS paid by State 10,644,621 10,069,863 Changes in assets and liabilities: (Increase) decrease in receivables (75,184) 730,347 (Increase) decrease in inventories (59,392) 278,778 (Increase) decrease in prepaids (93,267) 45,602 Increase (decrease) in accounts payable (323,072) (624,522) Increase (decrease) in accrued expenditures 183, ,675 Increase (decrease) in other liabilities 191,509 (189,381) Increase (decrease) in unearned revenue (176,057) (236,120) Increase (decrease) in compensated absences 26,479 91,377 NET CASH FROM OPERATING ACTIVITIES $ (44,538,917) $ (43,067,940) Schedule of non-cash items: SURS contribution paid by state $ 10,644,621 $ 10,069,863 (concluded) See accompanying notes to financial statements

31 FOUNDATION SPRINGFIELD, ILLINOIS STATEMENTS OF FINANCIAL POSITION June 30, 2014 and CURRENT ASSETS Cash and cash equivalents $ 271,609 $ 566,297 Accrued interest receivable - 17 Receivables: Contributions 284,159 52,511 Other 30,699 35,325 Investments 4,229,766 3,534,185 Net investment in capital lease 1,478,359 1,668,735 Land held for investment 2,773,000 2,745,545 TOTAL ASSETS $ 9,067,592 $ 8,602,615 LIABILITIES AND NET ASSETS Liabilities: Grants payable $ 18,680 $ 26,929 Scholarships payable 167, ,050 Accounts payable 184, ,589 Interest payable 30,125 33,825 Bonds payable 1,487,359 1,668,735 Total liabilities 1,887,869 2,091,128 NET ASSETS (DEFICIT) Unrestricted Land held for investment 2,633,000 2,606,931 Other (614,768) (589,623) Total unrestricted 2,018,232 2,017,308 Temporarily restricted 1,904,486 1,638,843 Permanently restricted 3,266,005 2,855,336 Total net assets 7,188,723 6,511,487 TOTAL LIABILITIES AND NET ASSETS $ 9,076,592 $ 8,602,615 See accompanying notes to financial statements

32 FOUNDATION SPRINGFIELD, ILLINOIS STATEMENT OF ACTIVITIES For the Year Ended June 30, 2014 Temporarily Permanently Unrestricted Restricted Restricted Total REVENUES AND GAINS Contributions, net of allowance $ 938 $ 328,357 $ 420,269 $ 749,564 In-kind contributions 267,740 36, ,178 Interest from capital lease 95, ,944 Investment income 88, , ,655 Special event 102, ,726 Grant - 10,000-10,000 Gain on on land held for investment 26,069 1,386-27,455 Rent 43, ,141 Other revenues and gains 55, ,857 Total revenues and gains 680, , ,269 1,782,520 Net assets reclassified (1,300) 10,900 (9,600) - Net assets released from restrictions 427,044 (427,044) - - 1,106, , ,669 1,782,520 EXPENSES Program services Scholarships and other assistance 581, ,815 Supporting activities Management and general 245, ,467 Fundraising 278, ,002 Total expenses 1,105, ,105,284 CHANGE IN NET ASSETS , , ,236 NET ASSETS - BEGINNING OF YEAR 2,017,308 1,638,843 2,855,336 6,511,487 NET ASSETS - END OF YEAR $ 2,018,232 $ 1,904,486 $ 3,266,005 $ 7,188,723 See accompanying notes to financial statements

33 FOUNDATION SPRINGFIELD, ILLINOIS STATEMENT OF ACTIVITIES. For the Year Ended June 30, 2013 Temporarily Permanently Unrestricted Restricted Restricted Total REVENUES AND GAINS Contributions, net of allowance $ 2,735 $ 326,162 $ 159,917 $ 488,814 In-kind contributions 260,005 38,067 25, ,072 Interest from capital lease 106, ,852 Investment income 70, , ,615 Special event 93, ,619 Grant - 10,800-10,800 Gain on land held for investment 378,785 20, ,925 Rent 40, ,807 Checking interest 1, ,350 Total revenues and gains 954, , ,917 1,753,854 Net assets released from restrictions 396,950 (396,950) - - 1,351, , ,917 1,753,854 EXPENSES Program services Scholarships and other assistance 490, ,404 Supporting activities Management and general 296, ,931 Fundraising 214, ,328 Total expenses 1,001, ,001,663 CHANGE IN NET ASSETS 350, , , ,191 NET ASSETS - BEGINNING OF YEAR 1,667,156 1,421,721 2,670,419 5,759,296 NET ASSETS - END OF YEAR $ 2,017,308 $ 1,638,843 $ 2,855,336 $ 6,511,487 See accompanying notes to financial statements

34 NOTES TO FINANCIAL STATEMENTS June 30, 2014 and SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial statements of Lincoln Land Community College District # 526 (the District) have been prepared in conformity with accounting principles generally accepted in the United States of America, as applied to government units (hereinafter referred to as generally accepted accounting principles (GAAP)). The Governmental Accounting Standards Board (GASB) is the standard-setting body for governmental accounting and financial reporting principles. In addition, the District presents its financial statements in accordance with accounting practices prescribed or permitted by the Illinois Community College Board (ICCB). The following is a summary of the more significant policies of the District. A. Organization The District is an Illinois community college operating under the mandates and guidelines of the Illinois Board of Higher Education and the Illinois Community College Board (ICCB). The District includes all or portions of 15 counties in central Illinois, including: Bond, Cass, Christian, DeWitt, Fayette, Greene, Logan, Macon, Macoupin, Mason, Menard, Montgomery, Morgan, Sangamon and Scott. The District provides academic classes to students in the area as well as community education classes in some outlaying communities. B. Reporting Entity The District is governed by an elected seven member Board of Trustees and a student representative. The District is fiscally independent and is considered a primary government pursuant to GASB Statement No.61. For financial reporting purposes, the District has included all funds, organizations, agencies, boards, commissions, and authorities for which the District is financially accountable. Under the criteria specified in Governmental Accounting Standards Board (GASB) Statement No. 39, Determining Whether Certain Organizations are Component Units, the District has included the Lincoln Land Community College Foundation (Foundation) as a discretely presented component unit

35 NOTES TO FINANCIAL STATEMENTS Continued 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Continued B. Reporting Entity Continued The primary criterion for including a potential component unit within the reporting entity under GASB Statement No. 39 is the financial accountability that the elected officials of the primary government have for the component unit. The criteria used in assessing financial accountability consist of (1) the primary government is financially accountable if it appoints a voting majority of the organization's governing body, and (a) it is able to impose its will on that organization, or (b) there is a potential for the organization to provide specific financial benefits or impose specific financial burdens on the primary government; and (2) the primary government may be financially accountable if the organization is fiscally dependent. The Foundation is a legally separate, tax-exempt organization that exists for the principal purpose of aiding and assisting the District in achieving its educational research and service goals and responsibilities. The 15-member board of the Foundation is self-perpetuating and consists of graduates and friends of the District. Although the District does not control the timing or amount of receipts from the Foundation, the majority of resources, or income thereon, the Foundation holds and invests are restricted to the activities of the District by the donors. Because these restricted resources held by the Foundation can only be used by, or for the benefit of, the District, the Foundation is considered a component unit of the District. The Foundation is also reported on in separate financial statements because of the difference in its reporting model, as further described below. The Foundation is a private not-for-profit organization that reports under Financial Accounting Standards Board (FASB) standards, including FASB Statement No. 117, Financial Reporting for Not for- Profit Organizations. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. No modifications have been made to the Foundation's financial information in the accompanying financial statements for these differences; however, significant footnote disclosures related to the Foundation's financial statements have been incorporated into the footnotes to the District's financial statements. Complete financial statements may be obtained by contacting the Foundation office. C. Measurement Focus and Basis of Accounting For financial reporting purposes, the District is considered a special purpose government engaged only in business-type activities. Accordingly, the District's financial statements have been presented using the economic resources measurement focus and the accrual basis of accounting. Under the accrual basis, revenues are recognized when earned, and expenses are recorded when an obligation has been incurred. All intra-agency transactions have been eliminated

36 NOTES TO FINANCIAL STATEMENTS Continued 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Continued C. Measurement Focus and Basis of Accounting Continued Non-exchange transactions, in which the District receives value without directly giving equal value in return, includes property taxes; federal, state, and local grants; state appropriations; and other contributions. On an accrual basis, revenue from property taxes is recognized in the period for which the levy is intended to finance. Revenue from grants, state appropriations, and other contributions is recognized in the year in which all eligibility requirements have been satisfied. Eligibility requirements include timing requirements, which specify the year when the resources are required to be used or the fiscal year when use is first permitted, matching requirements, in which the District must provide local resources to be used for a specified purpose, and expense requirements, in which the resources are provided to the District on a reimbursement basis when qualifying expenses are incurred. The District reports unearned revenue on its statement of net position. Unearned revenues arise when potential revenue does not meet both the measurable and earned criteria for recognition in the current period. Unearned revenues also arise when resources are received by the District before it has a legal claim to them, as when grant monies are received prior to meeting all eligibility requirements. In subsequent periods, when both revenue recognition criteria are met, or when the District has met all eligibility requirements, the liability for unearned revenue is removed from the statement of net position and revenue is recognized. Tuition and fee revenues received and related to courses held after June 30, 2014 are unearned. D. Cash and Cash Equivalents For purposes of reporting cash flows, the District considers all highly liquid investments purchased with a maturity of three months or less and Illinois Funds to be cash equivalents. The Illinois Funds is an external investment pool administered by the Illinois State Treasurer. The fair value of the District's investment in the fund is the same as the value of the pool shares. E. Restricted Assets Restricted cash are primarily unspent bond proceeds that can only be used for capital purposes. F. Investments Investments consist of Illinois Funds, a pooled money market and are carried at cost which approximates fair value

37 NOTES TO FINANCIAL STATEMENTS Continued 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Continued G. Prepaid Expenses Prepaid expenses represent payments for goods or services that benefit future periods. H. Inventories Inventories are accounted for using the consumption method. Under the consumption method, inventories are recorded as expenses when removed from inventory. At yearend a formal count is completed to verify the ending balance. Inventories are reported at the lower of cost or market determined on the FIFO (first-in, first-out) basis. I. Allowance for Doubtful Accounts Management has reviewed the collectability of its ordinary receivables and has deemed that all are collectible. However, the District has set up an allowance for doubtful accounts relative to the student tuition receivable accounts. J. Capital Assets Capital assets include property, plant, equipment, and infrastructure assets (i.e., roads, bridges, curbs, gutters, sidewalks, and similar items). Capital assets are reported at historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair value at the date of donation. The costs of normal maintenance and repairs that do not add to the value of assets or materially extend asset lives are not capitalized. Interest costs are capitalized while in development. The District incurred interest cost of $1,502,469 and $1,695,767 during fiscal year 2014 and 2013, respectively. Of the total interest expense $70,770 and $46,011 was capitalized during fiscal years 2014 and 2013, respectively. Capital assets are defined by the District as assets with estimated useful lives in excess of two years and initial individual costs in excess of $5,

38 NOTES TO FINANCIAL STATEMENTS Continued 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Continued J. Capital Assets Continued Depreciation is computed using the straight-line method over the following estimated useful lives: Years Buildings Other structures and improvements Equipment 5-15 Vehicles 3-5 The District does not capitalize or depreciate its collection of library books. The collection is unencumbered, held for public education, protected, and preserved. Any proceeds from sale of library books are insignificant. K. Long-Term Obligations Bond discounts are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond discount. Bond issuance costs are expensed as incurred. L. Net Position Net position represents the difference between assets and deferred outflows of resources and liabilities and deferred inflows of resources. Net Investment in Capital Assets - This represents the District's total investment in capital assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to acquisition, construction, or improvement of those capital assets. Restricted Net Position - Restricted net position includes resources that the District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties. When both restricted and unrestricted resources are available for use, it is the District's policy to use restricted resources first, and then unrestricted resources when they are needed. None of the District s restricted net position is restricted as a result of the District s enabling legislation. Unrestricted Net Position - Unrestricted net position represents resources derived from student tuition and fees, state appropriations, and sales and services of educational departments and auxiliary enterprises. These resources are used for transactions relating to the educational and general operations of the District and may be used at the discretion of the governing board to meet current expenses for any purpose

39 NOTES TO FINANCIAL STATEMENTS Continued 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Continued M. Classification of Revenues and Expenses Operating Revenue includes activities that have the characteristics of exchange transactions such as (1) student tuition and fees, and (2) sales and services of auxiliary enterprises, net of scholarship discounts and allowances. Non-operating revenue includes activities that have the characteristics of non-exchange transactions, such as (1) local property taxes, (2) state appropriations, (3) most federal, state and local grants and contracts, and federal appropriations, and (4) gifts and contributions. The District classifies all expenses as operating in the statement of revenues, expenses, and changes in net position, except for interest expense, which is classified as non-operating. N. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and deferred outflows of resources and liabilities and deferred inflows of resources at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. O. Claims and Judgments Liability resulting from claims and judgments, if any, is recorded as the liability is incurred. P. Accumulated Compensated Absences The District calculates its employee benefit obligation at year end based on both a legal commitment and internal policy. Classified staff members, professional staff members and administrators are credited with 15 days of sick leave at the beginning of each fiscal year. Faculty members are credited with 13 sick leave days and the potential for two more days if they work during the summer. During the first year of employment, sick leave is prorated based on the time worked during the year. Accumulated leave is subject to a maximum of 465 days and can be taken in the event of illness or doctors' appointments. Upon employee termination, the District has no commitment for accumulated sick leave; therefore, no liability is recorded. Certain employees who retire are given credit for unused sick leave toward years of service in the State Universities' Retirement System

40 NOTES TO FINANCIAL STATEMENTS Continued 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Continued P. Accumulated Compensated Absences Continued Classified staff members, professional staff members, administrators, and faculty members are credited with two personal days at the beginning of each fiscal year. Employees may accrue up to five personal days, but the District has made no commitment for payment at the time of departure. Classified staff members are entitled to ten vacation days per year until reaching five years of service at which point they earn one additional day per year to a maximum of 20 days annually. Professional staff members are entitled to 15 vacation days per year until reaching five years of service at which point they earn one additional day per year to a maximum of 20 days annually. Administrators are entitled to 20 vacation days per year. Classified, Professional, and Administrators are allowed to accumulate a maximum of 40 days. Faculty members are not entitled to vacation days. The estimated liabilities recorded include required salary or related payments as earned. Q. Termination Benefits In addition to any retirement benefits provided by the District described in Note 8, the District provides voluntary retirement benefits, considered early retirement incentives, to eligible faculty members. Faculty may select from two options. Option one is 1% times the years of District service times final base annual salary and 20% of final per diem rate times the number of unused sick days not to exceed 100. Option two is one, two, three or four year earnings program where the faculty are paid 106% of the previous year s annual base salary in equal installments over the course of the earnings program year. The District has not reported a liability for such benefits as the amount is not considered material. R. Reclassifications Certain amounts in prior-year financial statements have been reclassified for comparative purposes to conform with the presentation in the current-year financial statements. S. Deferred Outflows/Inflows of Resources In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense) until then. In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time

41 NOTES TO FINANCIAL STATEMENTS Continued 2. DEPOSITS AND INVESTMENTS It is the policy of the District to follow the Public Funds Investment Act and the Illinois Public Community College Act. Illinois Compiled Statutes (ILCS) authorize the District to make deposits/invest in commercial banks, savings and loan institutions, obligations of the U.S. Treasury and U.S. agencies, insured credit union shares, money market mutual funds with portfolios of securities issued or guaranteed by the United States or agreements to repurchase these same obligations, repurchase agreements, short-term commercial paper rated within the three highest classifications by at least two standard rating services, Illinois Funds and Illinois School District Liquid Asset Fund. Illinois Funds was created by the Illinois State Legislature and is managed by the Illinois State Treasurer. It acts as a money market fund that maintains a $1 per share value. A. Deposits with Financial Institutions Custodial credit risk - Custodial credit risk for deposits with financial institutions is the risk that in the event of bank failure, the District s deposits may not be returned to it. The District s investment policy requires all time deposits in excess of FDIC insurable limits must be secured by eligible collateral held in third-party safekeeping or private insurance to protect public deposits in a single financial institution if it were to default. B. Investments Interest Rate Risk Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment the greater the sensitivity of its fair value to changes in market interest rates. The District s investment policy does not specifically address interest rate risk or limit the maximum maturity length of investments. However, the District limits its exposure to interest rate risk by primarily investing in Illinois Funds. Credit Risk - The District does not specifically address credit risk, but limits its exposure to credit risk, the risk that the issuer of a debt security will not pay its par value upon maturity, by requiring investments in United States Treasury Notes, the Illinois Funds or the School District Liquid Asset Fund Plus. At June 30, 2014 and 2013, Illinois Funds are rated AAAm by Standard & Poor s

42 NOTES TO FINANCIAL STATEMENTS Continued 2. DEPOSITS AND INVESTMENTS Continued B. Investments Continued Custodial credit risk Custodial credit risk for investments is the risk that, in the event of the failure of the counterparty to the investment, the District will not be able to recover the value of its investments that are in possession of an outside party. The District s investment policy does not specifically address custodial credit risk for investments. Illinois Funds are not subject to custodial credit risk. Concentration of Credit Risk Concentration of credit risk is the risk of loss resulting from the concentration of assets in a specific maturity, a specific issuer, or a specific class of securities. The District's investment policy does not specifically address concentration of credit risk. However, the District uses the prudent-person rule: Investments are made as a prudent person would be expected to act, with discretion and intelligence, to seek reasonable income, preserved capital and, in general, avoid speculative investments. The District's does not invest in futures or options. 3. PROPERTY TAXES The District's property taxes are levied each calendar year on all taxable real property located in the District's boundaries. Taxes must be levied by the last Tuesday in December for the following levy year. The levy becomes an enforceable lien against the property as of the preceding January 1. These taxes become due and collectible in the following calendar year and are collected by the county collectors in the district who, in turn, remit to the District its respective share. Collection dates vary according to the schedules of the individual counties with disbursements to the District normally made within 30 days of collection. Property taxes are recognized as revenue in the year intended to finance, regardless of when collected. The second half of the 2013 tax levy is intended to finance the 2015 fiscal year and accordingly, is reported as unearned revenue. The 2014 property taxes receivable represent the 2013 levy applicable to the portion of the fiscal year ended June 30, The 2014 tax levy has not been recorded as a receivable at June 30, 2014, as the tax attached as a lien on property as of January 1, 2014; however, the tax will not be levied until December 2014 and, accordingly, is not measurable at June 30, The 2013 property tax receivable represents the 2012 levy and an estimate of the 2013 levy applicable to the portion of the fiscal year ended June 30, An allowance, if necessary, is provided for uncollectible property taxes; however, no allowance was provided as of June 30, 2014, as the District's management believes that all property taxes receivable will be collected. Property taxes that are not intended for current year operations are shown as unearned revenue. The amounts accrued from year to year will vary based upon the tax collections of the respective counties. The following are the tax rates permitted and the actual rates levied per $100 of assessed valuation

43 NOTES TO FINANCIAL STATEMENTS Continued 3. PROPERTY TAXES Continued Maximum Levy Year Rate Education Building Tort Immunity Audit Bond and Interest Social Security Health and Safety LONG-TERM DEBT A summary of changes in long-term liabilities for the year ended June 30, 2014 and 2013 are as follows: Balance Balance Current July 1, 2013 Issuances Retirements June 30, 2014 Portion Capital lease payable $ 2,804,298 $ - $ 353,327 $ 2,450,971 $ 370,511 Notes payable 1,188, , , ,099 Bonds payable 32,285, ,000 31,390, ,000 Bond discount (302,339) - (14,248) (288,091) (14,858) Compensated absences * 1,141,743 1,168,222 1,141,743 1,168, ,690 Total debt $ 37,117,449 $ 1,168,222 $ 2,572,470 $ 35,713,201 $3,165,442 * Gross amounts are not readily available. Balance Balance Current July 1, 2012 Issuances Retirements June 30, 2013 Portion Capital lease payable $ 3,141,988 $ - $ 337,690 $ 2,804,298 $ 352,121 Notes payable 56,263 1,200,000 67,516 1,188,747 1,182,360 Bonds payable 33,085, ,000 32,285, ,000 Bond discount (316,002) - (13,663) (302,339) (14,248) Compensated absences * 1,050,366 1,141,743 1,050,366 1,141, ,406 Total debt $ 37,017,615 $ 2,341,743 $ 2,241,909 $ 37,117,449 $3,228,639 * Gross amounts are not readily available

44 NOTES TO FINANCIAL STATEMENTS Continued 4. LONG-TERM DEBT Continued A. Capital Leases Payable Capital lease obligations represent various buildings with equal monthly payments and fixed interest rates ranging from 4.05% to 6.34%. Final maturity date is September 1, The obligations are secured by the buildings leased. The buildings are recorded as an asset of $6,228,808 and the total accumulated depreciation is $1,892,192, leaving a net book value of $4,336,616. The capital leases will mature as follows: Year Ending Total Debt June 30 Principal Interest Service 2015 $ 370,511 $ 126,325 $ 496, , , , ,655 88, , ,615 66, , ,965 43, , ,883 25, ,687 B. Notes Payable Total $ 2,450,971 $ 458,778 $ 2,909,749 On August 8, 2011, the District entered into a note agreement with Security Bank, Springfield, Illinois to purchase three twelve-passenger vans for $74,401. The note is due upon demand; but if no demand is made, principal and interest payments of $6,430 are due quarterly at an interest rate of 2.25%. Final maturity date is August 8, The note is collateralized by the vehicles

45 NOTES TO FINANCIAL STATEMENTS Continued 4. LONG-TERM DEBT Continued C. General Obligation Bonds, Series 2008A Original issue of $34,970,000 dated November 19, 2008, with increasing annual payments from $550,000 to $3,580,000 due December 15 of each year from 2009 through Interest rates range from 3.0% to 5.0%; interest paid semi-annually each June 15th and December 15th. The proceeds from the issuance were used to pay for improvement to the District s education facilities. The principal balance of these bonds at June 30, 2014 is $31,390,000. The 2008A issue will mature as follows: Year Ending Total Debt June 30 Principal Interest Service 2015 $ 995,000 $ 1,471,756 $ 2,466, ,105,000 1,434,869 2,539, ,225,000 1,389,650 2,614, ,350,000 1,338,150 2,688, ,485,000 1,277,738 2,762, ,925,000 5,139,788 15,064, ,305,000 2,038,624 17,343,624 Total $ 31,390,000 $ 14,090,575 $ 45,480,

46 NOTES TO FINANCIAL STATEMENTS Continued 5. CAPITAL ASSETS A summary of changes in capital assets for the year ended June 30, 2014 and 2013 are as follows: Balance Balance July 1, 2013 Additions Deductions June 30, 2014 Capital assets not being depreciated: Land $ 514,354 $ - $ - $ 514,354 Construction in progress 1,712,544 2,320,385 2,473,135 1,559,794 Total capital assets not being depreciated 2,226,898 2,320,385 2,473,135 2,074,148 Capital assets being depreciated: Buildings 61,172, ,172,767 Building improvements 17,852,473 1,340,846 9,570 19,183,749 Land improvements 12,295,772 1,127,404-13,423,176 Technology 2,230, ,230,181 Equipment 7,997, ,373 98,017 8,319,949 Total capital assets being depreciated 101,548,786 2,888, , ,329,822 Less accumulated depreciation: Buildings 15,744,658 1,228,450-16,973,108 Building improvements 4,506, ,779-5,447,797 Land improvements 9,770, ,620-10,018,628 Technology 1,639,420 69,746-1,709,166 Equipment 4,443, ,919 78,122 5,172,264 Total accumulated depreciation 36,103,571 3,295,514 78,122 39,320,963 Total capital assets being depreciated, net 65,445,215 (406,891) 29,465 65,008,859 Total capital assets, net $ 67,672,113 $ 1,913,494 $ 2,502,600 $ 67,083,

47 NOTES TO FINANCIAL STATEMENTS Continued 5. CAPITAL ASSETS Continued Balance Balance July 1, 2012 Additions Deductions June 30, 2013 Capital assets not being depreciated: Land $ 514,354 $ - $ - $ 514,354 Construction in progress 1,373,793 2,357,007 2,018,256 1,712,544 Total capital assets not being depreciated 1,888,147 2,357,007 2,018,256 2,226,898 Capital assets being depreciated: Buildings 61,172, ,172,767 Building improvements 14,770,081 3,082,392-17,852,473 Land improvements 12,131, ,719 6,578 12,295,772 Technology 2,230, ,230,181 Equipment 8,058, , ,690 7,997,593 Total capital assets being depreciated 98,363,176 3,482, , ,548,786 Less accumulated depreciation: Buildings 14,516,162 1,228,496-15,744,658 Building improvements 3,697, ,384-4,506,018 Land improvements 9,511, ,968 2,248 9,770,008 Technology 1,569,674 69,746-1,639,420 Equipment 3,897, , ,691 4,443,467 Total accumulated depreciation 33,192,624 3,187, ,939 36,103,571 Total capital assets being depreciated, net 65,170, ,992 20,329 65,445,215 Total capital assets, net $ 67,058,699 $ 2,651,999 $ 2,038,585 $ 67,672, RISK MANAGEMENT The District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; natural disasters and workers' compensation claims. Settled claims from these risks have not exceeded commercial insurance coverage for the past three fiscal years. Effective 1995, the District entered into a contractual agreement with the Illinois Community College Risk Management Consortium (the Consortium), which through its risk-sharing provisions, provides the District with its insurance coverage for liability, property damage, and worker's compensation insurance. As a self-insurance administrator, the Consortium enables risk sharing with other community colleges. The Consortium has 12 member community colleges, all located in the state of Illinois

48 NOTES TO FINANCIAL STATEMENTS Continued 6. RISK MANAGEMENT Continued Premiums are recognized as revenue over the terms of the policies on an annual basis. The Board of Directors, at its discretion, may authorize a credit to members for future premium payments to the Consortium in the form of dividends. Losses and loss adjustment expenses incurred equal net losses and loss adjustment expenses paid during the year plus (minus) the increase (decrease) in the liability for unpaid losses and loss adjustment expenses. The liability for unpaid losses and loss adjustment expenses represents an estimate of the ultimate net cost of all losses and loss adjustment expenses incurred but not yet paid as of the fiscal year ended. This includes estimates of losses, which have occurred but have not yet been reported to the Consortium. These estimates are based upon the historical experience of the Consortium as well as industry data and experience and the effects of inflation and other societal and economic factors. The methods used in making estimates and establishing the liability for unpaid losses and loss adjustment expenses are continually reviewed and updated. During fiscal year 1991, the District established the Employee Benefit Fund (Fund), an internal service fund, to account for and finance its uninsured risks of loss related to employee healthcare costs. Under this program, the Fund provides coverage of the District's employee health and accident insurance to $90,000 per occurrence of eligible expenses covered. Additionally, the District purchases commercial insurance for claims in excess of coverage provided by the Fund. As of June 30, 2014, claims have not exceeded the commercial insurance coverage limit for the past three fiscal years. The claims liability reported in the Fund at June 30, 2014 and 2013 is based on the requirements of Statement No. 10, which requires that a liability for claims be reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonable estimated. Claims liability includes all known claims and an amount for estimated claims that have been incurred but not reported (IBNR). Changes in the claims liability as of June 30, 2014, 2013 & 2012 were as follows: Claims payable, July 1 $ 400,000 $ 686,865 $ 686,865 Claims incurred 3,290,729 2,808,138 2,872,280 Claim payments (3,415,729) (3,095,003) (2,872,280) Claims payable, June 30 $ 275,000 $ 400, ,

49 NOTES TO FINANCIAL STATEMENTS Continued 7. COMMITMENTS A. Federal and State Grants The District has received a number of federal and state grants for specific purposes, which are subject to review and audit by grantor agencies. Such audits may result in requests for reimbursement to granting agencies for expenditures disallowed under the terms of the grants. Based on prior experience, District management believes that such disallowances, if any, will not be material. B. Construction Commitments The District has several construction contract commitments in progress at June 30, 2014 as follows: Variable Frequency Drive Units $ 148,341 Masonry Repairs 617,000 Taylorville PHS Code Compliance Renovation Project * 1,955,523 *Approved by the Board subsequent to June 30, RETIREMENT COMMITMENTS A. Pension Plan Description The District contributes to the State Universities Retirement System of Illinois (SURS), a cost sharing multiple-employer defined benefit pension plan with a special funding situation whereby the State of Illinois makes substantially all actuarially determined required contributions on behalf of the participating employers. SURS was established July 21, 1941 to provide retirement annuities and other benefits for staff members and employees of the state universities, certain affiliated organizations, and certain other state educational and scientific agencies and for survivors, dependents, and other beneficiaries of such employees. SURS is considered a component unit of the State of Illinois' financial reporting entity and is included in the state's financial reports as a pension trust fund. SURS is governed by Section 5/15, Chapter 40, of the Illinois Compiled Statutes. SURS issues a publicly available financial report that includes financial statements and required supplementary information. That report may be obtained by accessing our website at or calling

50 NOTES TO FINANCIAL STATEMENTS Continued 8. RETIREMENT COMMITMENTS Continued B. Funding Policy Plan members are required to contribute 8.0% of their annual covered salary and substantially all employer contributions are made by the State of Illinois on behalf of the individual employers at an actuarially determined rate. The current rate (for FY 2015) is 35.80% of annual covered payroll. The contribution requirements of plan members and employers are established and may be amended by the Illinois General Assembly. The employer contributions to SURS made by the District and the State are as follows: Years Ended June 30, District s Share as a Percentage of Required Contribution District State % 49,727 5,529, % 43,340 7,032, % 48,154 10,069, % 49,926 10,644,621 The District contributed $49,926 and $48,154 in 2014 and 2013, respectively, in accordance with the actuarially determined amounts; the State contributed $10,644,621 and $10,069,863 in 2014 and 2013, respectively, less than the actuarially determined requirement. 9. RETIREE HEALTH PLAN A. Plan Description In addition to the pension plan described previously, the District contributes to the State of Illinois Community College Health Insurance Security Fund (CHIP), a cost-sharing multiple-employer defined benefit postemployment healthcare plan administered by the State of Illinois. CHIP provides health, vision and dental benefits to retired staff and dependent beneficiaries of participating Community Colleges. The benefits, employer, employee, retiree and state contributions are dictated by Illinois Compiled Statutes (ILCS) through the State Group Insurance Act of 1971 (Act) and can only be changed by the Illinois General Assembly. Separate financial statements, including required supplementary information, may be obtained from the Department of Healthcare and Family Services, 201 South Grand Avenue East, Springfield, Illinois

51 NOTES TO FINANCIAL STATEMENTS Continued 9. RETIREE HEALTH PLAN Continued B. Funding Policy The Act requires every active contributor (employee) of SURS to contribute.5% of covered payroll and every community college district to contribute.5% of covered payroll. Retirees pay a premium for coverage that is also determined by ILCS. The State Pension Funds Continuing Appropriation Act (40/ILCS 15/1.4) requires the State of Illinois to make an annual appropriation to the CHIP to cover any expected expenditures in excess of the contributions by active employees, employers and retirees. The result is pay as you go financing of the plan. Employer contributions for the current year and preceding three years are as follows: Years Ended June 30, District s Contribution as a Percentage of Required Contribution District State % 133, , % 134, , % 135, , % 139, ,782 The State contribution to the CHIP plan is reported as an on-behalf payment in accordance with GASB Statement No. 24, Accounting and Financial Reporting for Certain Grants and Other Financial Assistance. 10. DISCRETELY PRESENTED COMPONENT UNIT The Lincoln Land Community College Foundation (The Foundation) exists for the principal purpose of aiding and assisting Lincoln Land Community College, District #526 (the District) in achieving its educational, research and service goals and responsibilities. The following is a summary of the more significant policies of the Foundation. A. Basis of Accounting The financial statements of the Foundation have been prepared on the accrual basis of accounting. Revenues are recognized when earned; support, when an unconditional promise to give is received; and expenses, when incurred

52 NOTES TO FINANCIAL STATEMENTS Continued 10. DISCRETELY PRESENTED COMPONENT UNIT Continued B. Basis of Presentation The Foundation reports net assets and support following accounting principles generally accepted in the United States of America (U.S. GAAP) for not-for-profit organizations, which require classification based on the existence or absence of donorimposed C. Cash and Cash Equivalents For purposes of the statement of cash flows, the Foundation considers reports cash on hand and demand deposit accounts as cash. Cash equivalents in brokerage accounts are reported as components of investments. D. Contributions and Promises to Give Contributions and unconditional promises to give (contributions receivable) are reported as support when received. Conditional promises to give are reported as support when the conditions for recognition are substantially met. Restricted contributions, whose restrictions are met in the year received, are reported as unrestricted support. Contributions that are receivable in less than one year are reported at their realizable amount (net of an estimate of uncollectible amounts). Contributions receivable in subsequent years are reported at the realizable amount, discounted to present value using the Wall Street Journal prime rate. E. Investments Investments are carried at fair value. Realized and unrealized gains and losses are included in the statement of activities. The Foundation follows the practice of widely diversifying its investments to mitigate concentrations of credit risk with respect to investments. F. Fair Value of Financial Instruments Accounting principles generally accepted in the United States of America define fair value as the price received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Management determines fair value based on assumptions market participants would use, including consideration of non-performance risk. Realized and unrealized gains and losses are reported in the statement of activities. The Foundation reports fair value of financial instruments using a three-level hierarchy, based on the extent to which inputs used in measuring fair value are observable in the market at the measurement date, as follows:

53 NOTES TO FINANCIAL STATEMENTS Continued 10. DISCRETELY PRESENTED COMPONENT UNIT Continued F. Fair Value of Financial Instruments continued Level 1 Inputs are unadjusted quoted prices for identical assets in active markets. Level 2 Inputs are observable quoted prices for similar assets in active markets. Level 3 Inputs are unobservable and reflect management s best estimate of what market participants would use as fair value. G. Capital assets The Foundation capitalizes assets with individual costs of $1,000 or more and useful lives of more than one year. Capital assets consist of equipment and software, which are reported at cost, or fair value if contributed, less depreciation and amortization on a straight line basis over the useful lives of the assets, which range from three to seven years. H. Endowment Funds The Foundation interprets laws pertaining to donor-restricted endowment gifts received as creating permanently restricted net assets to be held in perpetuity. The income is expendable for student scholarships or grants to college departments or teachers at various District campuses, as stipulated by the donor or for other needs if no stipulation is made. The Foundation policies prescribe the following for ensuring proper appropriation and expenditure of endowment funds. A permanently restricted account is maintained for each endowment gift with a unique donor stipulated purpose. A temporarily restricted account is maintained that corresponds to each endowment to accumulate investment earnings, realized gains and losses, and amounts expended. The Foundation Executive Director approves all expenditures charged to endowment fund temporarily restricted accounts, to ensure amounts are expended as stipulated. The Foundation s investment policies include objectives to achieve a maximum total return and provide for current income requirements while assuming a prudent degree of risk exposure. Specific investment guidelines are determined by the finance committee and reviewed and approved by the board. No specific return objectives are set; however, guidelines for percentages of assets to be invested in several classes of investments are established, and changes in investment allocations are made only after consultation with the Foundation s professional investment advisor and approval by the finance committee. These investment policies are intended to help attain the goals of the Foundation to provide scholarships and grants at levels consistent with prior years, increasing the growth of the college, but subject to the Foundation s ability to maintain adequate reserves

54 NOTES TO FINANCIAL STATEMENTS Continued 10. DISCRETELY PRESENTED COMPONENT UNIT Continued I. Income Taxes The Foundation is organized as a not-for-profit organization and is exempt from Federal Income taxes under section 501(a) of the Internal Revenue Code, as an organization described in section 501(c)(3), and has been determined not to be a private foundation. The Foundation follows accounting principles generally accepted in the United States of America related to the accounting for uncertainty in income taxes, which sets a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. At June 30, 2014, by statute, the Foundation s information returns (Form 990) for years subsequent to June 30, 2010, were open for review by authorities. Management evaluated tax positions for the open tax years at that date and determined no provision for uncertain tax positions was required. J. Contributed Services Contributed services are recognized if they (a) create or enhance nonfinancial assets or (b) require specialized skills, are provided by individuals with those skills, and would typically need to be purchased if not donated. K. Use of Estimates Preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from these estimates. L. Expense Allocation The costs of providing various programs and other activities have been summarized on a functional basis in the statement of activities. Accordingly, certain costs have been allocated among those programs and supporting services benefited

55 NOTES TO FINANCIAL STATEMENTS Continued 10. DISCRETELY PRESENTED COMPONENT UNIT Continued M. Land Held for Investment In 1976 land, consisting of five parcels totaling acres near the District s main campus was contributed to the Foundation without restriction. In 1997, land consisting of two parcels totaling acres near Petersburg, Illinois, was contributed to the Foundation with the stipulation that it be held for use by the District for a satellite campus. Both properties are reported herein as land held for investment, with the Petersburg land also included as a component of temporarily restricted net assets. During the year ended June 30, 2014, the Foundation elected to changes its method for valuation of land held for investment from the previous carrying value, established using fair value when the land was received, to the current fair value at the reporting dates. Accordingly, restatements of land held for investment, net assets and gains for fair value changes are reflected in the accompanying financial statements as follows: Temporarily Unrestricted Restricted Total Carrying value of land at June 30, 2012, as originally reported $ 293,533 $ 165,000 $ 458,533 Land carrying value restatements 1,934,613 (46,526) 1,888,087 Fair value at June 30, ,228, ,474 2,346,620 Restatements for 2013 gains 378,785 20, ,925 Fair value at June 30, ,606, ,614 2,745,545 Gains reported for ,069 1,386 27,455 Fair value at June 30, 2014 $2,633,000 $ 140,000 $2,773, PRIOR PERIOD ADJUSTMENT The District has restated net position as of July 1, 2012 as follows: NET POSITION, JULY 1 (as previously reported) $ 63,605,890 RESTATEMENTS To adjust for activity incorrectly included in the agency fund 455,580 NET POSITION, JULY 1, RESTATED $ 64,061,

56 INDEPENDENT AUDITOR S REPORT ON SUPPLEMENTARY INFORMATION To the Board of Trustees Lincoln Land Community College Community College District #526 Springfield, Illinois Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the District s basic financial statements. The introductory section, supplementary information, statistical section, supplemental financial information, and uniform financial statements as listed in the table of contents are presented for purposes of additional analysis and are not a required part of the basic financial statements. The supplementary information, supplemental financial information, and uniform financial statements as listed in the table of contents are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America by us and other auditors. In our opinion, based on our audit, the procedures described above, and the report of other auditors, the supplementary information, supplemental financial information, and uniform financial statements are fairly stated in all material respects in relation to the basic financial statements as a whole. The introductory and statistical sections 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. Springfield, Illinois October 9,

57 SUPPLEMENTARY INFORMATION

58 SPRINGFIELD, ILLINOIS COMBINING SCHEDULES OF NET POSITION ACCOUNTS, BY SUBFUND June 30, 2014 Liability, Operations and Restricted Protection and Bond and Education Maintenance Purposes Audit Settlement Interest Auxiliary ASSETS Current Assets Cash, cash equivalents and investments $ 16,558,057 $ 259,114 $ - $ 4,597 $ 52,182 $ - $ 4,100 Restricted cash 570, Receivables: Property taxes 10,620,627 2,753,496-46,641 2,524,362 1,682,519 - Government claims 2,275, Student tuition and fees 5,716, Other receivables, net 436, ,414 Prepaid expenses 93, Due from other funds - 10,330 5,026,759 65,426 1,828, ,904 4,250,889 Inventories ,707 Total Current Assets 36,272,128 3,022,940 5,026, ,664 4,405,002 1,900,423 5,062,110 Noncurrent Assets Land Construction-in-progress Depreciable capital assets, net of accumulated depreciation Total Noncurrent Assets TOTAL ASSETS 36,272,128 3,022,940 5,026, ,664 4,405,002 1,900,423 5,062,110 LIABILITIES Current Liabilities Accounts payable $ 868,291 $ - $ - $ - $ - $ - $ - Accrued expenditures 1,453, Due to other funds 18,060,719-35, ,020 - Claims payable Other liabilities 5, Interest payable Unearned student tuition and fees 6,395, , ,766 Unearned revenue , Bonds, contracts and leases payable Compensated absences Total current liabilities 26,783, ,741 84, ,020 83,766 Noncurrent Liabilities Bonds, contracts and leases payable Compensated absences Total noncurrent liabilities TOTAL LIABILITIES 26,783, ,741 84, ,020 83,766 DEFERRED INFLOWS OF RESOURCES Unearned property taxes 7,879,584 2,042,855-34,732 1,873,968 1,248,529 - Total deferred inflows of resources 7,879,584 2,042,855-34,732 1,873,968 1,248,529 - NET POSITION Net investment in capital assets Restricted for Capital Projects Debt Service ,874 - Grant Purposes , Audit Purposes , Liability Insurance ,531, Working Cash Unrestricted 1,608, ,344 4,199, ,978,344 TOTAL NET POSITION $ 1,608,858 $ 803,344 $ 4,942,082 $ 81,932 $ 2,531,034 $ 434,874 $ 4,978,344 (continued) See Independent Auditor's Report

59 Operations and Maintenance Employee Student Long-Term Capital Restricted Benefit Financial Aid Working Cash Agency Obligations Assets Eliminations Total $ - $ 568 $ 1,055 $ 14,175,655 $ 10,108 $ - $ - $ - 31,065, , ,512, , ,440, , ,415, ,716, ,069 1, ,528-8, ,267 6,232, , , (18,321,316) ,707 7,045,772 1,334, ,809 14,175, , (18,321,316) 60,683, , , ,559,794-1,559, ,008,859-65,008, ,083,007-67,083,007 7,045,772 1,334, ,809 14,175, ,740-67,083,007 (18,321,316) 127,766,254 $ - $ 4,140 $ 137,295 $ - $ - $ - $ - $ - 1,009, , ,554, , (18,321,316) , , , , , , , ,656, , ,342, ,342, , , , , ,740 3,391,115 - (18,321,316) 13,334, ,202, ,202, , , ,547, ,547, , , ,740 35,938,875 - (18,321,316) 45,882, , ,683, , ,683, (34,245,446) 67,083,007-32,837,561 6,442, (401,023) - - 6,041, , , , , ,531, ,500, ,500,000-1,055,421-1,675,655 - (1,292,406) ,028,352 $ 6,442,206 $ 1,055,421 $ 3,103 $ 14,175,655 $ - $ (35,938,875) $ 67,083,007 $ - 68,200,985 (concluded) See Independent Auditor's Report

60 SPRINGFIELD, ILLINOIS COMBINING SCHEDULE OF NET POSITION ACCOUNTS, BY SUBFUND June 30, 2013 Liability, Operations and Restricted Protection and Bond and Education Maintenance Purposes Audit Settlement Interest Auxiliary ASSETS Current Assets Cash, cash equivalents and investments $ 12,115,301 $ 1,759,019 $ - $ 4,596 $ 52,170 $ - $ 3,900 Restricted cash 2,318, Receivables: Property taxes 10,449,971 2,710,143-46,906 2,625,451 1,636,313 - Government claims 2,431, Student tuition and fees 5,810, Other receivables, net 386, ,635 Prepaid expenses Due from other funds 1,534,841-5,090,057 54,064 1,082, ,317 3,701,099 Inventories ,315 Total Current Assets 35,047,499 4,469,162 5,090, ,566 3,759,762 1,799,630 4,502,949 Noncurrent Assets Land Construction-in-progress Depreciable capital assets, net of accumulated depreciation Total Noncurrent Assets TOTAL ASSETS $ 35,047,499 $ 4,469,162 $ 5,090,057 $ 105,566 $ 3,759,762 $ 1,799,630 $ 4,502,949 LIABILITIES Current Liabilities Accounts payable $ 1,017,145 $ - $ - $ - $ - $ - $ - Accrued expenditures 1,371, Due to other funds 16,879,437 1,481,139 34, ,020 - Claims payable Other liabilities 6, Interest payable Unearned student tuition and fees 6,454, , ,150 Unearned revenue 3, , Bonds, contracts and leases payable Compensated absences Total current liabilities 25,731,476 1,672, , ,020 84,150 Noncurrent Liabilities Bonds, contracts and leases payable Compensated absences Total noncurrent liabilities TOTAL LIABILITIES 25,731,476 1,672, , ,020 84,150 DEFERRED INFLOWS OF RESOURCES Unearned property taxes 7,724,642 2,003,131-34,567 1,941,321 1,209,757 - Total deferred inflows of resources 7,724,642 2,003,131-34,567 1,941,321 1,209,757 - NET POSITION Net investment in capital assets Restricted for Capital Projects Debt Service ,853 - Grant Purposes , Audit Purposes , Liability Insurance ,818, Working Cash Unrestricted 1,591, ,342 4,239, ,418,799 TOTAL NET POSITION $ 1,591,381 $ 793,342 $ 4,906,634 $ 70,999 $ 1,818,441 $ 372,853 $ 4,418,799 (continued) See Independent Auditor's Report

61 Operations and Maintenance Employee Student Long-Term Capital Restricted Benefit Financial Aid Working Cash Agency Obligations Assets Eliminations Total $ - $ 568 $ 1,046 $ 14,074,859 $ 16,105 $ - $ - $ - $ 28,027,564-1,436, ,755, , ,994, , ,711, ,810,618-17,176 1, ,588-8, ,000 7,829, , (19,627,173) ,315 8,355,600 1,462, ,882 14,074, , (19,627,173) 59,509, , , ,712,544-1,712, ,445,215-65,445, ,672,113-67,672,113 $ 8,355,600 $ 1,462,138 $ 281,882 $ 14,074,859 $ 187,937 $ - $ 67,672,113 $ (19,627,173) $ 127,181,981 $ - $ - $ 277,377 $ - $ - $ - $ - $ - $ 1,294, ,371, ,331 3, , (19,627,173) , , , , , , , ,730, , ,415,233 2,415, , , , , , ,937 3,352,823 - (19,627,173) 13,483, ,560, ,560, , , ,888, ,888, , , , ,937 37,241,633 - (19,627,173) 47,371, , ,302, , ,302, (34,019,520) 67,672,113-33,652,593 6,968, (1,956,186) - - 5,012, , , , , ,818, ,500, ,500,000-1,058,508-1,574,859 - (1,265,927) ,410,098 $ 6,968,477 $ 1,058,508 $ 3,094 $ 14,074,859 $ - $ (37,241,633) $ 67,672,113 $ - $ 66,507,867 (concluded) See Independent Auditor's Report

62 SPRINGFIELD, ILLINOIS COMBINING SCHEDULES OF REVENUES, EXPENSES AND CHANGES IN NET POSITION, BY SUBFUND For the Year Ended June 30, 2014 Liability, Operations and Restricted Protection and Bond Education Maintenance Purposes Audit Settlement and Interest OPERATING REVENUES Student tuition and fees, tuition chargebacks, net of scholarship allowances $ 16,263,305 $ 490,186 $ - $ - $ - $ - Auxiliary enterprise revenue Facilities revenue - 31, Other operating revenue 204,341 12, ,540-11,810 - Total Operating Revenues 16,467, , ,540-11,810 - OPERATING EXPENSES Instruction 24,132, , Academic support 5,318, , Student services 3,571, , Public services 923,842-1,381, Auxiliary services 1,061,900-5, Institutional support 10,703, ,400 3,116,449 - Operation and maintenance of plant 909,858 4,807,655 22, Tuition chargebacks 68, Auxiliary enterprise Depreciation Total Operating Expenses 46,690,428 4,807,655 3,245,314 58,400 3,116,449 - Operating income (loss) (30,222,782) (4,273,370) (3,130,774) (58,400) (3,104,639) - Non-Operating revenues (expenses) Property taxes $ 15,901,699 $ 4,123,108 $ - $ 69,332 $ 3,817,220 $ 2,459,489 Corporate personal property replacement taxes 1,016, , State grants and contracts 13,503, ,318 1,651, Federal grants and contracts 24,783-1,492, Investment earnings 105, Debt service Principal - (94,143) (895,000) Interest - (38,363) (1,502,468) Loan proceeds Other non-operating revenues (expenses) Loss on Disposal of Assets Transfers in 40,000-61, Transfers out (351,363) (685,186) (40,000) Total Non-Operating revenues (expenses) 30,240,259 4,283,372 3,166,222 69,333 3,817,232 62,021 CHANGE IN NET POSITION 17,477 10,002 35,448 10, ,593 62,021 NET POSITION (DEFICIT) - BEGINNING OF YEAR 1,591, ,342 4,906,634 70,999 1,818, ,853 NET POSITION (DEFICIT) - END OF YEAR $ 1,608,858 $ 803,344 $ 4,942,082 $ 81,932 $ 2,531,034 $ 434,874 (continued) See Independent Auditor's Report

63 Operations and Maintenance Employee Student Long-term Capital Auxiliary Restricted Benefit Financial Aid Working Cash Agency Obligations Assets Eliminations Total $ - $ - $ - $ - $ - $ - $ - $ - $ (7,368,574) $ 9,384,917 6,810, (1,779,677) 5,030, , , (4,656) 568,769 6,810, , (9,152,907) 15,015, , ,804, , (4,656) 5,668, ,333, (9,120,550) 10,634, ,305, ,067, (27,701) 13,850,639 35,095 2,250, (2,665,102) - 5,360, ,428 6,115, ,115, ,295,514-3,295,514 6,150,481 2,250,068 12,738 15,333, , ,412 (9,152,907) 73,169, ,732 (2,020,157) (12,738) (15,333,772) - - (26,479) (630,412) - (58,153,791) $ - $ 992,747 $ - $ - $ - $ - $ - $ - $ - $ 27,363, ,117, ,032, ,333, ,851,503-7,844 9, , ,886 (283,582) (171,429) ,444, (106,468) (20,462) (100,669) 70,770 - (1,697,660) (14,248) - - (14,248) (29,464) - (29,464) 289,863 5,722, (6,114,196) - - (5,037,647) ,114,196 - (100,187) 1,493,886 9,651 15,333, ,796-1,329,237 41,306-59,846, ,545 (526,271) (3,087) 9 100,796-1,302,758 (589,106) - 1,693,118 4,418,799 6,968,477 1,058,508 3,094 14,074,859 - (37,241,633) 67,672,113-66,507,867 $ 4,978,344 $ 6,442,206 $ 1,055,421 $ 3,103 $ 14,175,655 $ - $ (35,938,875) $ 67,083,007 $ - $ 68,200,985 (concluded) See Independent Auditor's Report

64 SPRINGFIELD, ILLINOIS COMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION, BY SUBFUND For the Year Ended June 30, 2013 Liability, Operations and Restricted Protection and Bond Education Maintenance Purposes Audit Settlement and Interest OPERATING REVENUES Student tuition and fees, tuition chargebacks, net of scholarship allowances $ 16,321,763 $ 509,326 $ - $ - $ - $ - Auxiliary enterprise revenue Facilities revenue - 19, Other operating revenue 236,301 14, ,991-33,949 - Total Operating Revenues 16,558, , ,991-33,949 - OPERATING EXPENSES Instruction 23,647, , Academic support 5,451, , Student services 3,494, , Public services 869,621-1,354, Auxiliary services 970,697-3, Institutional support 10,753, ,300 3,053,168 - Operation and maintenance of plant 807,753 4,365,100 24, Tuition chargebacks 43, Auxiliary enterprise Depreciation Total Operating Expenses 46,039,089 4,365,100 3,241,185 58,300 3,053,168 - Operating income (loss) (29,481,025) (3,821,500) (3,046,194) (58,300) (3,019,219) - Non-Operating revenues (expenses) Property taxes $ 15,327,171 $ 3,973,115 $ - $ 65,347 $ 3,497,630 $ 2,382,448 Corporate personal property replacement taxes 892, , State grants and contracts 13,762, ,206 1,413, Federal grants and contracts 25,448-1,649, Investment earnings 45,942 1, Debt service Principal - (89,545) (800,000) Interest - (42,960) (1,530,013) Loan proceeds Other non-operating revenues (expenses) , Loss on Disposal of Assets Transfers in , Transfers out (561,962) (744,326) Total Non-Operating revenues (expenses) 29,491,925 3,844,280 3,975,382 65,350 3,497,666 52,435 NET CHANGE IN NET POSITION 10,900 22, ,188 7, ,447 52,435 NET POSITION (DEFICIT) - BEGINNING OF YEAR 1,580, ,562 3,521,866 63,949 1,339, ,418 PRIOR PERIOD ADJUSTMENT , NET POSITION (DEFICIT) - BEGINNING OF YEAR, AS RESTATED 1,580, ,562 3,977,446 63,949 1,339, ,418 NET POSITION (DEFICIT) - END OF YEAR $ 1,591,381 $ 793,342 $ 4,906,634 $ 70,999 $ 1,818,441 $ 372,853 (continued) See Independent Auditor's Report

65 Operations and Operations and Maintenance Employee Student Long-term Capital Auxiliary Restricted Benefit Financial Aid Working Cash Agency Obligations Assets Eliminations Total $ - $ - $ - $ - $ - $ - $ - $ - $ (7,081,518) 9,749,571 7,019, (1,731,351) 5,288, , , (6,683) 895,085 7,019, , (8,819,552) 15,952, , ,394, (6,683) 5,857, ,972, (8,788,283) 10,468, ,224, (24,586) 949, ,865,194 13,476 3,730, (3,775,618) - 5,165, ,700 6,268, ,268, ,187,886-3,187,886 6,281,517 3,730,066-14,972, ,378 (587,732) (8,819,552) 72,424, ,458 (3,730,066) 421,800 (14,972,027) - - (91,378) 587,732 - (56,471,719) $ - $ 1,047,954 $ - $ - $ - $ - $ - $ - $ - $ 26,293, ,065, ,749, ,972, ,647,270-26,965 $ 9, , ,422 (268,587) (42,857) ,200, (121,462) (5,550) ,218 46,011 - (1,649,756) 1,200,000 (1,200,000) (13,663) , (20,329) - (20,329) 320,790 4,128, (4,690,680) - - (3,384,392) ,690,680 - (69,259) 2,970,838 9,627 14,972,037 90,609 - (8,456) 25,682-58,918, ,199 (759,228) 431, ,609 - (99,834) 613,414-2,446,397 3,749,600 7,727, ,081 3,084 13,984,250 - (37,141,799) 67,058,699-63,605, ,580 3,749,600 7,727, ,081 3,084 13,984,250 - (37,141,799) 67,058,699-64,061,470 $ 4,418,799 $ 6,968,477 $ 1,058,508 $ 3,094 $ 14,074,859 $ - $ (37,241,633) $ 67,672,113 $ - $ 66,507,867 (concluded) See Independent Auditor's Report

66 NOTES TO SUPPLEMENTARY INFORMATION June 30, 2014 and 2013 The District accounts for all operating activity in the Education sub-fund. All accruals are recorded in the Education subfund and an interfund receivable or payable is recorded to reflect the amount due from or to the subfund the transaction relates to. For financial reporting purposes, the District is reported as a single enterprise fund at the basic financial statement level. All interfund activity between the various sub-funds is eliminated at the combining sub-fund level. Therefore, the total columns on the Combining Schedules included in the supplementary information are correct in relation to the basic financial statements

67 STATISTICAL SECTION

68 STATISTICAL SECTION This part of the Lincoln Land Community College District# 526 s comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures and required supplementary information displays about the District s overall financial health. Contents Page(s) Financial Trends These schedules contain trend information to help the reader understand how the District s financial performance and well-being have changed over time Revenue Capacity These schedules contain information to help the reader assess the District s most significant local revenue source, the property tax Debt Capacity The schedules present information to help the reader assess the affordability of the District s current levels of outstanding debt and the District s ability to issue additional debt in the future Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within which the District s financial activities take place Operating Information These schedules contain service and infrastructure data to help the reader understand how the information in the District s financial report relates to the services the District provides and the activities it performs

69 SPRINGFIELD, ILLINOIS NET POSITION BY COMPONENT Last Ten Fiscal Years Business-Type Activities Net investment in capital assets $32,837,561 $33,652,593 $35,314,982 $38,354,463 $19,358,379 $17,677,146 $26,127,093 $24,397,904 $24,973,230 $24,512,994 Restricted 22,335,072 20,445,176 17,843,399 14,053,395 2,978,016 2,169,810 1,749,624 1,311, , ,019 Unrestricted 13,028,352 12,410,098 10,447,509 9,540,651 39,296,523 36,226,748 23,449,159 20,836,567 16,476,982 13,859,093 Total Business-Type Activities net position $68,200,985 $66,507,867 $63,605,890 $61,948,509 $61,632,918 $56,073,704 $51,325,876 $46,545,647 $42,265,985 $39,043,106 Note: Beginning in 2011, the District began reporting restricted net position which is primarily related to unspent property taxes Data Source: Audited Financial Statements

70 SPRINGFIELD, ILLINOIS CHANGES IN NET POSITION Last Ten Fiscal Years Fiscal Year OPERATING REVENUES Student tuition and fees, net of allowances $ 9,384,917 $ 9,749,571 $ 8,946,818 $ 9,085,308 Auxiliary enterprises revenue 5,030,536 5,288,624 5,214,154 5,031,523 Facilities revenue 31,276 19,547 15,131 24,953 Other operating revenue 568, , , ,537 SURS contribution provided by state Total operating revenues 15,015,498 15,952,827 14,543,864 14,491,321 OPERATING EXPENSES Instruction 24,804,252 24,394,445 22,586,520 21,214,269 Academic support 5,668,024 5,857,675 5,385,852 5,228,964 Student services 10,634,392 10,468,298 11,669,788 10,633,386 Public services 2,305,251 2,224,523 1,890,808 1,395,916 Auxiliary services 1,067, , , ,015 Institutional support 13,850,639 13,865,194 12,608,295 12,266,224 Operation and maintenance of plant 5,360,388 5,165,514 6,380,416 5,690,473 Tuition chargebacks 68,428 43,700 41,811 43,207 Auxiliary enterprises 6,115,386 6,268,041 6,030,131 6,009,121 Depreciation 3,295,514 3,187,886 2,506,335 1,978,762 SURS contribution paid by state Claims paid for external parties Total operating expenses 73,169,289 72,424,546 69,702,532 64,976,337 OPERATING INCOME (LOSS) (58,153,791) (56,471,719) (55,158,668) (50,485,016) NONOPERATING REVENUES (EXPENSES) Property taxes 27,363,595 26,293,665 26,719,056 26,282,140 Corporate personal replacement taxes 1,117,136 1,065, State grants and contracts 16,032,161 15,749,962 13,456,496 10,927,260 Federal grants and contracts 16,851,503 16,647,270 17,293,599 16,888,815 Investment income 223, , , ,206 Interest expense and fiscal charges (1,697,660) (1,649,756) (518,525) (1,132,849) Other nonoperating revenues (expenses) (14,248) 656,943 (17,360) (16,647) Gain/(loss) on disposal of capital assets (29,464) (20,329) (177,762) (58,282) Contributions from Lincoln Land Community College Foundation Total nonoperating revenues (expenses) 59,846,909 58,918,116 56,918,743 53,146,643 INCOME (LOSS) BEFORE CONTRIBUTIONS 1,693,118 2,446,397 1,760,075 2,661,627 CAPITAL CONTRIBUTIONS CHANGE IN NET POSITION $ 1,693,118 $ 2,446,397 $ 1,760,075 $ 2,661,627 Notes: (1) During fiscal year 2011, SURS contribution revenue was reported with state grants and contracts and SURS contribution expenses were allocated to the various expense functions Data Source: Audited Financial Statements

71 $ 12,915,166 $ 11,185,020 $ 10,539,307 $ 7,014,515 $ 6,999,090 $ 5,969,497 7,058,133 7,126,672 6,741,709 6,869,911 6,668,097 6,345,256 24,506 24,920 31,088 30,856 21,328 47, , , , , , ,310 4,889,000 2,912,853 2,187,202 1,594,669 1,078,269 1,755,275 25,211,947 21,594,327 19,657,320 15,938,229 15,132,878 14,435,817 17,120,018 16,064,334 15,391,641 14,653,209 14,456,602 14,185,611 4,547,498 4,420,716 4,133,415 3,824,746 3,799,199 3,227,899 9,304,585 6,739,255 6,271,050 3,464,633 3,513,823 3,445, , ,353 1,677, , , , , , , , , ,432 10,482,648 9,699,427 9,016,750 8,675,597 8,097,978 7,403,677 4,283,108 5,490,944 5,051,639 4,774,412 4,534,971 4,137,990 72,117 66,480 51,148 58,417 67,786 75,114 6,485,871 6,700,134 6,402,209 6,002,545 6,141,692 5,927,175 1,732,301 1,669,538 1,423,348 1,329,181 1,448,799 1,186,745 4,889,000 2,912,853 2,187,202 1,594,669 1,078,269 1,755, ,051 60,381,035 54,967,277 52,192,202 45,633,110 44,429,501 42,636,066 (35,169,088) (33,372,950) (32,534,882) (29,694,881) (29,296,623) (28,200,249) 25,531,064 24,978,844 24,257,708 22,981,159 21,701,385 20,704, ,369,820 5,328,119 6,806,689 5,186,630 5,416,666 6,089,192 9,903,393 6,290,730 5,680,243 5,011,240 5,002,133 4,901, , , , , , ,247 (731,905) (1,600,292) (143,767) (203,267) (371,209) (276,158) (12,191) (380) ,728,302 35,940,594 37,315,111 33,959,115 32,503,293 31,820,241 5,559,214 2,567,644 4,780,229 4,264,234 3,206,670 3,619, ,430 16, ,005 $ 5,559,214 $ 2,567,644 $ 4,780,229 $ 4,279,664 $ 3,222,879 $ 3,749,

72 SPRINGFIELD, ILLINOIS ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY Last Ten Tax Levy Years Tax Fiscal Year Total Taxable Total Direct Estimated Assessed Value Levy Ended Assessed Tax Actual as a Percentage Year June 30 Value Rate Value of Actual Value ,780,057, ,515,326, % ,702,604, ,280,620, % ,608,452, ,995,311, % ,508,692, ,693,006, % ,382,669, ,311,119, % ,176,172, ,685,371, % ,021,169, ,215,666, % ,775,876, ,472,352, % ,598,621, ,935,217, % ,383,348, ,282,873, % Data Source: College Records and Various Counties *2013 Total taxable Assessed Value Allocation Residential 3,979,569,807 Farm 334,087,342 Commercial 1,445,592,460 Industrial 17,340,173 Mineral 3,468,

73 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Sangamon County Ashland-Chandlerville CUSD # Athens CUSD # Auburn CUSD # Chatham CUSD # Divernon CUSD # Divernon CUSD #13 Bonds Edinburg CUSD # Illiopolis CUSD # Mt Pulaski CUSD # New Berlin CUSD # North Mac CUSD # Pawnee CUSD # Pleasant Plains CUSD # Porta CUSD # Riverton CUSD # Rochester CUSD #3A Sangamon Valley CUSD # Springfield CUSD # Tri-City CUSD # Virden CUSD # Waverly CUSD # Williamsville CUSD # Auburn Corporation Berlin Corporation Buffalo Corporation Cantrall Corporation Chatham Corporation Clear Lake Corporation Dawson Corporation Divernon Corporation Grandview Corporation Illiopolis Corporation Jerome Corporation Leland Grove Corporation Loami Corporation Mechanicsburg Corporation New Berlin Corporation Pawnee Corporation Pleasant Plains Corporation Riverton Corporation Rochester Corporation Sherman Corporation Southern View Corporation Spaulding Corporation Springfield Corporation Thayer Corporation Virden Corporation Williamsville Corporation

74 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Auburn Township Ball Township Buffalo Hart Township Capital Township Cartwright Township Chatham Township Clear Lake Township Cooper Township Cotton Hill Township Curran Township Divernon Township Fancy Creek Township Gardner Township Illiopolis Township Island Grove Township Lanesville Township Loami Township Maxwell Township Mechanicsburg Township New Berlin Township Pawnee Township Rochester Township Springfield Township Talkington Township Williams Township Woodside Township Auburn R & B Ball R & B Buffalo Hart R & B Cartwright R & B Chatham R & B Clear Lake R & B Cooper R & B Cotton Hill R & B Curran R & B Divernon R & B Fancy Creek R & B Gardner R & B Illiopolis R & B Island Grove R & B Lanesville R & B Loami R & B Maxwell R & B Mechanicsburg R & B New Berlin R & B Pawnee R & B Rochester R & B Springfield R & B Talkington R & B Williams R & B

75 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Woodside R & B Spfld Airport Authority Loami Township Spec. FPD Athens-Fancy Prairie FPD Auburn FPD Buffalo FPD Chatham FPD Curran FPD Dawson Area FPD Divernon FPD Eastside FPD Elkhart FPD Illiopolis FPD Island Grove FPD Lake Springfield FPD Loami FPD Mechanicsburg FPD New Berlin FPD Northside FPD Pawnee FPD Pleasant Plains FPD Riverton FPD Rochester FPD Sherman FPD South Oak Knolls FPD Southlawn FPD Southside FPD Virden FPD Western FPD Williamsville FPD Woodside FPD Spfld MEAA Springfield Mass Transit Iles Junction SSA Laketown SSA Legacy Pointe SSA Leland Grove SSA # Springfield Sanitary District Virden Sanitary District Cooper-Cotton Hill MTA Illiopolis-Lanesville MTA Loami-Maxwell-Talkington MTA Mechanicsburg-Buffalo Hart MTA New Berlin-Island Grove MTA Springfield Park District Springfield Park Distrist- Recreation Dept Ashland Public Library Chatham Area Library Chatham Library Bond Chatham Library Bond #

76 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Grand Prairie Library Illiopolis-Niantic Public Library Mt Pulaski Public Library Prairie Skies Library Rochester Library Sherman Library Tri-City Library West Sangamon Library Sangamon County Montgomery County Auburn CUSD # Bond County CUSD # Girard CUSD #03A Highland CUSD #05A Hillsboro CUSD # Litchfield CUSD # Morrisonville CUSD # Mt. Olive CUSD # Nokomis CUSD # North Mac CUSD # Pana CUSD # Panhandle CUSD # Pawnee CUSD # Ramsey CUSD # Vandalia CUSD # Virden CUSD # Hillsboro SB Dist U Divernon Bond Only Pana Bond Butler Corporation Coalton Corporation Coffeen Corporation Donnellson Corporation Farmersville Corporation Fillmore Corporation Harvel Corporation Hillsboro Corporation Irving Corporation Litchfield Corporation Nokomis Corporation Ohlman Corporation Panama Corporation Raymond Corporation Schram City Corporation Taylor Spring Corporation Waggoner Corporation Walshville Corporation Witt Corporation

77 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Audubon Township Bois Darc Township Butler Grove Township East Fork Township Fillmore Township Grisham Township Harvel Township Hillsboro Township Irving Township Nokomis Township North Litchfield Township Pitman Township Raymond Township Rountree Township South Fillmore Township South Litchfield Township Walshville Township Witt Township Zanesville Township Audubon Road District Bois Darc Road District Butler Grove Road District East Fork Road District Fillmore Road District Grisham Road District Harvel Road District Hillsboro Road District Irving Road District Nokomis Road District North Litchfield Road District Pitman Road District Raymond Road District Rountree Road District South Litchfield Road District Walshville Road District Witt Road District Zanesville Road District Litchfield Airport Farms-Wagg AMB Hillsboro AMB Litchfield AMB Nokomis-Witt AMB Raymond-Harv AMB Coffeen FPD Divernon FPD Farms-Wagg FPD Fillmore FPD Morr-Palmer FPD Mt. Olive FPD New Douglas FPD

78 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Nokomis FPD Pawnee FPD Raymond FPD Shoal Creek FPD Virden FPD CES Extension Serv MTA Audubon-Nokomis MTA But-Irv-Roun MTA Fil-S. Fil-Witt MTA Grish-Walsh MTA Harv-Pit-Zanes Pitman Township Park Litchfield Park Nokomis Park Raymond Park Nokomis Township Library Witt Township Library Doyle Library Dist Farms-Wagg Library Gr Prairie W. Library Hillsboro Library Litchfield Library County tax Menard County Ashland-Chandlerville CUSD # Athens CUSD # Greenview CUSD # Mt. Pulaski CUSD # Pleasant Plains CUSD # Porta CUSD # Williamsville CUSD # Lincoln Comm High School New Holland-Middleton Elem # Athens Corporation Greenview Corporation Oakford Corporation Petersburg Corporation Tallula Corporation Road District Road District Road District Road District Road District Road District Road District Road District Road District Road District

79 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Road District Road District Road District Road District Menard County Rescue District Athens - Fancy Prairie FPD Greenview FPD Mason City FPD Middletown FPD Oakford FPD Petersburg FPD Pleasant Plains FPD Tallula FPD Chatqua Sanitation Water Authority Ashland Library Prairie Skies Library County Tax County Cemetery Tallula Cemetery Christian County Morrisonville CUSD # Raymond CUSD # Taylorville CUSD # Edinburg CUSD # Pawnee CUSD # South Fork CUSD # Nokomis CUSD # Rochester CUSD #3A Sangamon Valley CUSD # Pana-Tower Hill CUSD # Meridian CUSD # Central A&M CUSD # Pana School Bonds Taylorville City Assumption City Pana City Assumption Township Bear Creek Township Buckhart Township Greenwood Township Johnson Township King Township Locust Township May Township Mosquito Township Mt. Auburn Township Pana Township

80 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Prairieton Township Ricks Township Rosamond Township Stonington Township South Fork Township Taylorville Township Bulpitt Village Edinburg Village Harvel Village Jeisyville Village Kincaid Village Morrisonville Village Mt. Auburn Village Owaneco Village Palmer Village Stonington Village Moweaqua Village Tovey Village Assumption Township R & B Bear Creek Township R & B Buckhart Township R & B Greenwood Township R & B Johnson Township R & B King Township R & B Locust Township R & B May Township R & B Mosquito Township R & B Mt. Auburn Township R & B Pana Township R & B Prairieton Township R & B Ricks Township R & B Rosamond Township R & B Stonington Township R & B South Fork Township R & B Taylorville Township R & B Morrisonville-Palmer AMB Raymond-Harvel AMB Edinburg FPD Assumption FPD Blue Mound FPD Moweaqua FPD Stonington FPD Midland FPD Morrisonville-Palmer FPD Mt. Auburn FPD Niantic FPD Nokomis Area FPD Owaneco FPD Pawnee FPD Raymond FPD

81 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Rochester FPD Taylorville FPD Taylorville Sanitary District MAD #1 Mt. Auburn MAD #2 Stonington MAD #3 Bear Creek MAD #4 Greenwood Edinburg Park District Taylorville Park District Prairieton Park District Stonington Park District City Library of Taylorville Rochester Public Library Assumption Public Library Blue Mound Library District Pana City Library Doyle Public Library District Moweaqua Public Library District Ricks Township Library Stonington Township Library County Morgan County A-C Central CUSD # Franklin CUSD # Greenfield CUSD # Jacksonville CUSD # Meredosia-Chambersburg CUSD # New Berlin CUSD # Pleasant Plains CUSD # Scott-Morgan CUSD # Triopia CUSD # Virginia CUSD # Waverly CUSD # Winchester CUSD # Marnico Village SSA City of Jacksonville City of Waverly Village of Chapin Village of Concord Village of Franklin Village of Lynnville Village of Meredosia Village of Murrayville Village of South Jacksonville Village of Woodson Road District # Road District # Road District #

82 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Road District # Road District # Road District # Road District # Road District # Road District # Road District # Road District # Road District # Road District # Airport Authority Meredosia Bluffs Rescue Squad Alexander FPD Franklin FPD Island Grove FPD Meredosia FPD Murrayville FPD New Berlin FPD North Scott FPD Woodson FPD M-C River Valley Public Library Prairie Skies Public Library West Sangamon Library Morgan County Macoupin County Waverly CUSD # Panhandle CUSD # North Mac CUSD # Franklin CUSD # Mt. Olive CUSD # Litchfield CUSD # Southwestern CUSD # Northwestern CUSD # Greenfield CUSD # Gillespie CUSD # Bunker Hill CUSD # Carlinville CUSD # Staunton CUSD # Girard CUSD # Virden CUSD # Carlinville Corporation Mt. Olive Corporation Royal Lakes Corporation Bunker Hill Corporation Benld Corporation Staunton Corporation Brighton Corporation Gillespie Corporation

83 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Virden Corporation Chesterfield Corporation Wilsonville Corporation Sawyerville Corporation Medora Corporation Girard Corporation Lake Kaho Corporation Dorchester Corporation Palmyra Corporation Shipman Corporation Scotville Corporation Standard City Corporation Mt. Clare Corporation Hettick Corporation Nilwood Corporation White City Corporation Eagerville Corporation Modesto Corporation E. Gillespie Corporation Western Mound Township S. Palmyra Township Dorchester Township Nilwood Township Barr Township Bird Township N. Palmyra Township Gillespie Township Polk Township Shipman Township Chesterfield Township S. Otter Township Honey Point Township Girard Township Cahokia Township Mt. Olive Township N. Otter Township Bunker Hill Township Hilyard Township Virden Townhip Scottville Township Shaws Point Township Brighton Township Staunton Township Carlinville Township Brushy Mound Township S. Otter R & B S. Palmyra R & B Bird R & B Nilwood R & B N. Otter R & B

84 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Western Mound R & B Barr Township R & B N. Palmyra R & B Scottville R & B Dorchester R & B Shaws Pt. R & B Chesterfield R & B Hilyard R & B Shipman R & B Polk R & B Virden R & B Gillespie R & B Carlinville R & B Honey Point R & B Brushy Mound R & B Brighton R & B Cahokia R & B Bunker Hill R & B Girard R & B Staunton R & B Mt. Olive R & B New Douglas FPD Staunton FPD Girard FPD Mt Olive FPD Betsey-Ann FPD Unit 7 FPD Sco-Modesto FPD Raymond FPD Medora Comm FPD Bunker Hill FPD Virden FPD Farm-Wagg FPD Greenfield FPD Special Service # Veterans Adv Comm U of I Coop Ext. Ed Virden Sanitary Multi-Township Assessor Multi-Township Assessor Multi-Township Assessor Multi-Township Assessor Multi-Township Assessor Carlinville Park Farm-Wagg Library Brighton Library Carlinville Library Litchfield Library Grand Prairie Library Gillespie Library

85 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Tax Levy Years Taxing Bodies Mt. Olive Library Bunker Hill Library Girard Township Library Benld Library Staunton Library County Tax Total Overlapping Rate Lincoln Land Community College Total Rate Note: Tax rates for property within the district are expressed in dollars per hundred dollars of equalized assessed value. Data Source: County Clerk's Offices Maximum Rates: Education Fund Building Audit Health and Safety

86 SPRINGFIELD, ILLINOIS PRINCIPAL TAXPAYERS Current Year and Nine Years Ago Sangamon County FY2014 FY2006 Percentage of Percentage of Type of *Assessed Total *Assessed Total Taxpayer Business Value Assessed Value Value Assessed Value White Oaks Mall Ltd Retail 8,100, % 8,658, % Horace Mann Service Insurance 5,167, % 4,574, % Memorial Health Systems Medical 4,785, % - - Wells Fargo Home Mtg Inc. Commercial 4,784, % 4,230, % White Oaks Plaza LLC Retail 4,496, % - - Springfield Clinic Medical 4,430, % - - Wal-Mart Business Trust Retail 4,317, % Springfield Clinic Medical 4,140, % Memorial Health Systems Medical 3,968, % Town & Country Group Banking 3,890, % - - Morgan County Reynolds Foil Industry 8,238, % Ameren Energy Industry 6,247, % 5,786, % Walmart Stores Inc. Retail 3,240, % Lincoln Square Partnership Commercial 2,685, % - - MYND Corporation Commercial 1,769, % 1,530, % EPOG Inc. Industry 1,767, % SNG Realty, LLC Commercial 1,675, % - - Home Depot Commercial 1,663, % - - Farmers State Bank Banking 1,600, % Celanese Ltd Industry 1,598, %

87 SPRINGFIELD, ILLINOIS PRINCIPAL TAXPAYERS Current Year and Nine Years Ago FY2014 FY2006 Percentage of Percentage of Type of *Assessed Total *Assessed Total Taxpayer Business Value Assessed Value Value Assessed Value Menard County First Natl Bank Banking 1,925, % 910, % M. Kincaid Farming 938, % 568, % Memorial Health Systems Commercial 883, % 854, % Culver Fancy Prairie Co-Op Farming 814, % 595, % Menard Electric Commercial 594, % 358, % J. Lozier Farming 576, % 418, % Farmers Grain & Co. Commercial 515, % 475, % Schirding Farms Inc. Farming 406, % - - Kents Family Inc. Commercial 388, % 368, % T. James Farming 385, % Montgomery County Dynegy Inc. Industrial 54,905, % Wal-Mart Stores Retail 4,162, % - - Hillsboro Energy LLC Industrial 1,942, % Kranos Corporation Commercial 1,685, % - - Litchfield Il TX Commercial 1,228, % - - Pioneer Hi Bred Commercial 1,185, % - - Sierra International Industrial 1,012, % - - M & M Service Commercial 902, % - - Fisher & Ludlow Commercial 890, % - - Illinois Power Company Commercial 878, % Christian County County is unable to provide this information Macoupin County County is unable to provide this information Notes: (1) Information is presented for the years the information was available. (2) Sangamon County taxpayers listed twice have multiple parcels. Data Source: County Clerk's Offices

88 COMMUNITY COLLEGE DISTRICT #529 SPRINGFIELD, ILLINOIS PROPERTY TAX RATES, EXTENSIONS AND COLLECTIONS Last Ten Tax Levy Years Tax Levy Year Fiscal Year Assessed valuation $ 5,780,057,817 $ 5,702,604,674 $ 5,608,452,684 $ 5,508,692,008 $ 5,382,669,545 $ 5,176,172,574 $ 5,021,169,917 $ 4,775,876,303 $ 4,598,621,742 $ 4,383,348,134 Tax rates (per $100 of assessed valuation): Education Fund Building Tort Immunity Audit Fund Bond and Interest Social Security Health and Safety Tax extensions Education Fund $ 15,606,156 $ 15,397,033 $ 15,142,822 $ 14,873,468 $ 14,533,208 $ 13,975,666 $ 13,557,159 $ 12,894,866 $ 12,416,279 $ 11,835,040 Building 4,046,040 3,991,823 3,925,917 3,856,084 3,767,869 3,623,321 3,514,819 3,343,113 3,219,035 3,068,344 Tort Immunity 3,196,372 3,324,619 2,641,581 2,682,733 2,637,508 2,122,231 1,998,426 1,833,937 1,811,857 1,797,173 Audit Fund 69,361 68,431 61,693 71,613 69,975 67,290 55,233 42,983 41,388 61,367 Bond and Interest 2,485,425 2,412,202 2,344,333 2,275,090 2,206,895 2,148,112 1,350,695 1,418,435 1,420,974 1,354,455 Social Security 525, , , , , , , , , ,118 Health and Safety 1,202, ,554 1,317,986 1,173,351 1,001,177 1,501,090 2,485,479 2,101,386 1,986,605 1,941,823 Total tax extensions 27,131,591 26,517,112 25,905,442 25,362,017 24,647,246 23,862,156 23,363,505 22,021,566 21,300,817 20,448,320 Tax collections: Current fiscal year (8,925,602) (26,604,418) (25,959,954) (25,522,735) (24,779,724) (24,193,680) (23,540,346) (22,947,280) (21,793,259) (20,621,535) Prior fiscal years - (739) (1,051) (4,083) (3,272) (41,698) (341,663) (203) (242) (567) Total collected (8,925,602) (26,605,158) (25,961,005) (25,526,818) (24,782,996) (24,235,378) (23,882,009) (22,947,483) (21,793,501) (20,622,102) Total uncollected 18,205,989 (88,046) (55,563) (164,801) (135,750) (373,222) (518,504) (925,917) (492,684) (173,782) Tax collections as a percent of total tax extensions 32.90% % % % % % % % % % Data Source: District's Business Office and County Clerk's Offices

89 SPRINGFIELD, ILLINOIS RATIO OF OUTSTANDING DEBT BY TYPE Last Ten Fiscal Years Percentage of District Total Outstanding Total Estimated Debt to Estimated Outstanding Fiscal General Total Actual Taxable Actual Taxable Debt Year Obligation Capital Lease Notes Outstanding Property Property Population Per Ended Bonds (1) Obligations Payable Debt Value Value (Estimated) Capita 2014 $ 31,375,752 $ 2,450,971 $ 992,099 $ 34,818,822 $ 17,515,326, % 339, ,271,337 2,804,298 1,188,747 36,264,382 17,280,620, % 339, ,071,898 3,141,988 56,236 36,270,122 16,995,311, % 339, ,782,436 3,459,589-37,242,025 16,693,006, % 339, ,407,952 3,762, ,061 38,274,806 16,311,119, % 338, ,963,202 4,142, ,532 39,277,158 15,685,371, % 338, ,285,000 4,486, ,937 6,040,381 15,215,666, % 338, ,585,000 4,810, ,136 7,573,213 14,472,352, % 338, ,830,000 5,120, ,642 9,249,130 13,935,217, % 338, ,993,750 5,420, ,728 10,728,539 13,282,873, % 338, Notes: (1) Balances are net of unamortized discounts/premiums and include current and noncurrent portions of bond principal outstanding (2) Details of the District's outstanding debt can be found in the notes to financial statements Data Sources: District records and County Clerks Offices

90 SPRINGFIELD, ILLINOIS RATIO OF NET GENERAL BONDED DEBT OUTSTANDING Last Ten Fiscal Years Percentage of Net General Bonded Fiscal-Year General Estimated Debt to Estimated Net General Ended Obligation Actual Taxable Actual Taxable Bonded Debt June 30, Bonds (1) Property Value Property Value Population Per Capita 2014 $ 31,375,752 $ 17,515,326, % 339, ,271,337 17,280,620, % 339, ,085,000 16,995,311, % 339, ,795,000 16,693,006, % 339, ,420,000 16,311,119, % 338, ,970,000 15,685,371, % 338, ,536,238 15,215,666, % 338, ,095,260 14,472,352, % 338, ,771,177 13,935,217, % 338, ,728,539 13,282,873, % 338, Notes: (1) Balances are net of unamortized discounts/premiums and include current and noncurrent portions of bond princi (2) Details of the District's outstanding debt can be found in the notes to financial statements Data Sources: District records and County Assessor's Offices

91 SPRINGFIELD, ILLINOIS LEGAL DEBT MARGIN Last Ten Fiscal Years Legal Debt Margin Calculation for Fiscal Year 2014 Assessed value levy $ 5,780,057,817 Debt limit (2.875% of assessed valuation) $ 166,176,662 Debt applicable to limit: Long-Term Debt 31,375,752 Less: amount set aside for repayment of general obligation debt (434,874) Total net debt applicable to limit 30,940,878 Legal debt margin $ 135,235,784 Fiscal Year Debt limit $ 166,176,662 $ 163,949,884 $ 161,243,015 $ 158,374,895 $ 154,751,749 $ 148,814,962 $ 144,358,635 $ 137,306,444 $ 132,210,375 $ 126,021,259 Total net debt applicable to limit 31,375,752 32,285,000 32,764,582 33,541,674 38,090,003 39,157,315 5,536,238 7,095,260 8,771,177 10,728,539 Legal debt margin $ 134,800,910 $ 131,664,884 $ 128,478,433 $ 124,833,221 $ 116,661,746 $ 109,657,647 $ 138,822,397 $ 130,211,184 $ 123,439,198 $ 115,292,720 Total net debt applicable to the limit as a percentage of debt limit 18.88% 19.69% 20.32% 21.18% 24.61% 26.31% 3.84% 5.17% 6.63% 8.51% Data Source: District's Business Office

92 SPRINGFIELD, ILLINOIS COMPUTATION OF DIRECT AND OVERLAPPING BONDED DEBT - GENERAL OBLIGATION BONDS June 30, 2014 Bonds ISSUER (**Overlapping) Outstanding Percent Amount Sangamon County Athens CUSD #213 $ 8,442, % $ 8,442,731 Auburn Township 205, % 205,000 Auburn/Divernon CUSD #13 3,016, % 3,016,397 Chatham Area Library 2,900, % 2,900,000 Chatham Corporation 3,805, % 3,805,000 Chatham CUSD #5 56,930, % 56,930,000 City of Springfied 17,412, % 17,412,304 Edinburg CUSD #4C 510, % 510,000 Illiopolis Township 220,000 6% 12,100 Isles Junction 477, % 477,679 Mt. Pulaski CUSD #23 720, % 720,000 New Berlin Corporation - 100% - New Berlin CUSD #16 9,890, % 9,890,000 North Mac CUSD #34 4,655, % 4,655,000 Pawnee CUSD #11 735, % 735,000 Pleasant Plains CUSD #8 11,005, % 11,005,000 Porta CUSD #202 14,290, % 14,290,000 Riverton Corporation 1,875, % 1,875,000 Riverton CUSD #14 11,995, % 11,995,000 Rochester FPD 750, % 750,000 Rochester Unit #3A 40,055, % 40,055,000 Sangamon Valley CUSD #9 1,000, % 1,000,000 Sherman Corp - 100% - Sherman SSA 227, % 227,634 SMEA 1,725, % 1,725,000 Springfield Airport Authority 1,775, % 1,775,790 Springfield District # ,760, % 137,760,000 Springfield Park District 13,380, % 13,380,000 Springfield Sanitary District 56,205, % 56,205,000 Tri-City Unit #1 3,795, % 3,795,000 Village of Chatham 4,134, % 4,134,000 Village of Rochester 1,860, % 1,860,652 Waverly CUSD 445, % 445,000 Williamsville Unit #15 3,656, % 3,656,

93 SPRINGFIELD, ILLINOIS COMPUTATION OF DIRECT AND OVERLAPPING BONDED DEBT - GENERAL OBLIGATION BONDS June 30, 2014 Bonds ISSUER (**Overlapping) Outstanding Percent Amount Montgomery County Auburn/Divernon Unit #13 3,016, % $ 3,016,397 City of Hillsboro 10,190, % 10,190,000 Hillsboro CUSD #3 9,635, % 9,635,000 Litchfield Airport 150, % 150,000 Litchfield CUSD #12 4,404, % 4,404,000 Litchfield Park District 215, % 215,000 Morrisonville CUSD #1 2,580, % 2,580,000 Nokomis CUSD #22 1,105, % 1,105,000 North Mac CUSD #34 4,655, % 4,655,000 Pawnee CUSD #11 735, % 735,000 Raymond/Panhandle CUSD #2 3,705, % 3,705,000 Village of Farmersville 1,295, % 1,295,000 Menard County Athen CUSD #213 8,442, % 8,442,732 Mt. Pulaski CUSD #23 720, % 720,000 Pleasant Plains CUSD #8 11,005, % 11,005,000 Porta CUSD #202 14,290, % 14,290,000 Williamsville CUSD #15 3,656, % 3,656,314 Macoupin County City of Gillespie 445,000 * City of Girard 710,000 * Gillespie CUSD #7 10,410,000 * Litchfield CUSD #12 4,404,000 * North Mac CUSD #34 4,655,000 * Northwestern CUSD #2 80,000 * Panhandle/Raymond CUSD #2 3,705,000 * Waverly CUSD #6 445,000 *

94 SPRINGFIELD, ILLINOIS COMPUTATION OF DIRECT AND OVERLAPPING BONDED DEBT - GENERAL OBLIGATION BONDS June 30, 2014 Bonds ISSUER (**Overlapping) Outstanding Percent Amount Morgan County Scott/Morgan Unit #1 172,125 * Scott/Morgan Unit #2 58,443 * New Berlin CUSD #16 1,122,137 * A-C Central CUSD # ,491 * Waverly CUSD #6 305,257 * Pleasant Plains CUSD #8 636,171 * Christian County County 630, % 630,695 Edinburg CUSD #4 510, % 510,000 Morrisonville CUSD #1 2,580, % 2,580,000 Nokomis CUSD #22 1,105, % 1,105,000 Panhandle/Raymond CUSD #2 3,705, % 3,705,000 Pawnee CUSD #11 735, % 735,000 Rochester CUSD #3A 40,055, % 40,055,000 South Fork CUSD #14 2,085, % 2,085,000 Taylorville City 12,310, % 12,310,000 Taylorville CUSD #3 11,415, % 11,415,000 Taylorville Park District 1,315, % 1,315,000 Total Overlapping Debt 571,890,739 Total Direct Debt of the College 31,375,752 Total Direct and Overlapping Debt $ 603,266,491 Notes: * County is unable to determine the percentage of overlap for Lincoln Land Community College District #526 ** Information as of June 30, 2014 *** The overlapping rate was determined by the County. Data Source: County Clerk's Offices

95 SPRINGFIELD, ILLINOIS DEMOGRAPHIC AND ECONOMIC STATISTICS Last Ten Calendar Years Median Unemployment Year Population Assessed Value Per Capita Household Income Rate ,605 $ 5,780,057,817 $ 17, , % ,605 5,702,604,674 16, , % ,605 5,608,452,684 16, , % ,605 5,508,692,008 16, , % ,996 5,382,669,545 15, , % ,996 5,176,172,574 15, , % ,996 5,021,169,917 14, , % ,996 4,775,876,303 14, , % ,996 4,598,621,742 13, , % ,996 4,383,348,134 12, , % Note: The Unemployment Rate is based on the yearly average for Sangamon County only. Data Sources: District's Planning & Institutional Improvement Department US Census American Community Survey US Bureau of Labor Statistics

96 SPRINGFIELD, ILLINOIS MAJOR EMPLOYERS Current Year and Five Years Ago 2014 % of 2009 Employer Employees Total Employment Product/Service Employer Employees Product/Service State of Illinois 18,300 19% Government State of Illinois 17,000 Government Memorial Health System 6,047 6% Health Care Memorial Health System 3,400 Health Care St. Johns Hospital 3,004 3% Health Care St. Johns Hospital 2,839 Health Care Springfield Public Schools #186 2,300 2% Education Illinois National Guard 2,700 Government Springfield Clinic, LLP 2,075 2% Health Care Springfield Public Schools #186 2,019 Education Illinois National Guard 1,819 2% Government City of Springfield 1,789 Government SIU School of Medicine 1,587 2% Health Care/Education Horace Mann Insurance company 1,280 Insurance City of Springfield 1,547 2% Government SIU School of Medicine 1,200 Health Care/Education University of Illinois at Springfield 1,166 1% Education Springfield Clinic, LLP 900 Health Care Blue Cross / Blue Shield 1,146 1% Insurance SBC 900 Telecommunications U.S. Postal Service 900 Government Notes: The information has been presented for the years the information was available. Data Source: City of Springfield Office of Planning & Economic Development Website US Bureau of Labor Statistics Total employed as of December 2013 was 96,

97 SPRINGFIELD, ILLINOIS OPERATING INFORMATION AND EMPLOYEES Last Ten Fiscal Years Enrollment - full-time equivalent (10th day) 4,453 4,555 4,630 4,880 4,740 4,156 4,012 3,960 4,076 4,133 4,267 Degrees awarded Associate in Arts (AA) Associate in Science (AS) Associate in Fine Arts (AFA) Associate in Engineering Studies (AES) Associate in Applied Science (AAS) Associate in General Studies (AGS) , Faculty* Full-time Part-time *As of October 1 Payroll Average annual faculty salary 77,252 75,697 74,588 72,225 71,548 68,726 66,557 65,036 64,247 62,349 60,116 Staff (excluding faculty)* Full-time Part-time *As of October 1 Payroll Students per faculty/staff Students per faculty Students per staff (excluding faculty) Data Sources: District's Office of Planning and Evaluation and Research; District's Payroll Office

98 SPRINGFIELD, ILLINOIS OPERATING STATISTICS Last Ten Fiscal Years Cost Student/ Fiscal Instructional Per Percentage Faculty Year Expenses Enrollment Student Change Faculty Ratio 2014 $ 24,804,252 4,453 $ 5, % ,394,445 4,555 5, % ,586,520 4,630 4, % ,214,269 4,880 4, % ,120,018 4,740 3, % ,064,334 4,156 3, % ,495,275 4,012 3, % ,653,209 3,960 3, % ,456,602 4,076 3, % ,185,611 4,133 3, % Note: Instructional expenses for fiscal year 2014 includes the proportional share of the SURS contibution made by the State Data Sources: College departments

99 DISTRICT #526 SPRINGFIELD ILLINOIS OPERATING INFORMATION CAPITAL ASSET STATISTICS Last Ten Fiscal Years Function/Program Main Campus Size of campus in acres Number of buildings Gross square footage 652, , , , , , , , , ,856 Number of parking lots Number of parking spaces 2,247 2,247 2,247 2,194 2,194 2,194 2,194 2,194 2,194 2,144 Note: Above information includes the main campus located in Springfield Illinois and all of the Educational Service Area buildings both owned and leased. Data Source: District records

100 SPRINGFIELD, ILLINOIS STUDENT ENROLLMENT DEMOGRAPHIC STATISTICS (FALL TERM) Last Ten Fiscal Years FISCAL FALL GENDER ATTENDANCE ACADEMIC ENROLLMENT STATUS IN DISTRICT AVERAGE YEAR *H/C FTE M F FT PT FRESH OTHER FIRST** READMIT OTHER RESIDENCY AGE ,020 4,453 42% 58% 43% 57% 55% 45% 23% 11% 66% 96% ,193 4,555 42% 58% 42% 58% 55% 45% 23% 15% 62% 96% ,337 4,630 42% 58% 43% 57% 57% 43% 18% 19% 61% 96% ,602 4,880 42% 58% 45% 55% 58% 42% 19% 16% 65% 95% ,677 4,740 41% 59% 43% 57% 44% 56% 26% 15% 59% 96% ,659 4,156 41% 59% 44% 56% 47% 53% 20% 19% 61% 96% ,655 4,012 41% 59% 41% 59% 49% 51% 20% 17% 63% 97% ,532 3,960 41% 59% 41% 59% 50% 50% 20% 23% 57% 97% ,847 4,076 41% 59% 39% 61% 51% 49% 18% 23% 59% 97% ,942 4,133 41% 59% 40% 60% 53% 47% 18% 24% 58% 97% 27 Note: *H/C = Headcount ** First time college level at LLCC Data Source: District records

101 SPECIAL REPORTS SECTION

102 DISTRICT #526 CERTIFICATION OF CHARGEBACK REIMBURSEMENT FOR FISCAL YEAR 2015 ALL FISCAL YEAR 2014 NONCAPTIAL AUDITED OPERATING EXPENDITURES FROM THE FOLLOWING FUND: I Education Fund 2 Operations and Maintenance Fund 3 Restricted Operation and Maintenance Fund 4 Bond and Interest Fund 5 Public Building Commission Rental fund 6 Restricted Purposes Fund 7 Audit Fund 8 Liability, Protection and Settlement Fund 9 Auxiliary Enterprises Fund (subsidy only) $ 35,846,978 4,7 11,635 20,462 I,502,468 12,226,628 58,400 3,116, , TOTAL NONCAPITAL EXPENDITURES 57,772,883 II Depreciation on capital outlay expenditures (equipment, buildings, fixed equipment paid) from sources other than state and federal funds 3,295, TOTAL COSTS INCLUDED 6 1,068, Total certified semester credit hours for FY , PER CAPITA COST All FY20 14 state and federal operating grants for noncapital expenditures, except ICCB grants I,402, FY20 14 state and federal grants per semester credit hour 17 District's average ICCB grant rate (excluding equalization grants) for FY District's student tuition and fee rate per semester credit hour for FY Charge back reimbursement per semester credit hour $ Approval ---'-{tl ' 1fJ Chief Fiscal Officer =---_Jj