Hall County Board of Education, Gainesville, Georgia, annual financial report for the fiscal year ended 2024 June 30 (including independent auditor's reports).

Hall County Board of Education
Gainesville, GA
Annual Financial Report For the Fiscal Year Ended June 30, 2024
Including Independent Auditor's Report

Hall County Board of Education Table of Contents

Section I Financial
Independent Auditor's Report

Required Supplementary Information

Management's Discussion and Analysis

i

Exhibits

Basic Financial Statements

Government-Wide Financial Statements

A

Statement of Net Position

1

B

Statement of Activities

2

Fund Financial Statements

C

Balance Sheet

Governmental Funds

3

D

Reconciliation of the Governmental Funds Balance Sheet

to the Statement of Net Position

4

E

Statement of Revenues, Expenditures and Changes in Fund Balances

Governmental Funds

5

F

Reconciliation of the Governmental Funds Statement of

Revenues, Expenditures and Changes in Fund Balances

to the Statement of Activities

6

G Notes to the Basic Financial Statements

7

Schedules

Required Supplementary Information

1 Schedule of Proportionate Share of the Net Pension Liability

Teachers Retirement System of Georgia

37

2 Schedule of Contributions Teachers Retirement System of Georgia

38

3 Schedule of Proportionate Share of the Net Pension Liability Public

School Employees Retirement System of Georgia

39

4 Schedule of Proportionate Share of the Net OPEB Liability

School OPEB Fund

40

5 Schedule of Contributions School OPEB Fund

41

6 Notes to the Required Supplementary Information

42

7 Schedule of Revenues, Expenditures and Changes in Fund

Balances - Budget and Actual General Fund

43

Supplementary Information

8 Schedule of Expenditures of Federal Awards

44

9 Schedule of State Revenue

46

10 Schedule of Approved Local Option Sales Tax Projects

48

Section II
Compliance and Internal Control Reports
Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards
Independent Auditor's Report on Compliance for Each Major Federal Program and on Internal Control Over Compliance Required by the Uniform Guidance

Section III Auditee's Response to Prior Year Findings and Questioned Costs Summary Schedule of Prior Audit Findings

Section IV Findings and Questioned Costs Schedule of Findings and Questioned Costs

Section V Management's Corrective Action for Current Year Findings Schedule of Management's Corrective Action

Section I Financial

Greg S. Griffin State Auditor
INDEPENDENT AUDITOR'S REPORT
The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Mr. William Schofield, Superintendent and Members of the Hall County Board of Education
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities and each major fund of the Hall County Board of Education (School District) as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements as listed in the table of contents.
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and each major fund of the School District as of June 30, 2024, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report.
We are required to be independent of the School District and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for 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.
270 Washington Street, SW, Suite 4-101 Atlanta, Georgia 30334 | Phone (404) 656-2180

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the School District's ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with GAAS and Government Auditing Standards, we:
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Obtain an understanding of internal control relevant to the audit 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 School District's internal control. Accordingly, no such opinion is expressed.
Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the School District's ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis and required supplementary information listed in the table of contents be presented to supplement the basic financial statements. Such information is the responsibility of management and, 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 GAAS, 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 appropriate evidence to express an opinion or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the School District's basic financial statements. The accompanying supplementary information, as listed in the table of contents, is presented for the purposes of additional analysis and is not a required part of the basic financial statements. The Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, and is also not a required part of the basic financial statements.
The supplementary information is the responsibility of management and was derived from and relates 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 GAAS. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated March 27, 2025 on our consideration of the School District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely 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 effectiveness of the School District's 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 School District's internal control over financial reporting and compliance.

A copy of this report has been filed as a permanent record and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24. Respectfully submitted,
Greg S. Griffin State Auditor
March 27, 2025

HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024
INTRODUCTION
The School District's financial statements for the fiscal year ended June 30, 2024 include a series of basic financial statements that report financial information for the School District as a whole and its funds. The Statement of Net Position and the Statement of Activities provide financial information about all of the School District's activities and present both a short-term and long-term view of the School District's finances on a global basis. The fund financial statements provide information about all of the School District's funds. Information about these funds, such as the School District's general fund, is important in its own right, but will also give insight into the School District's overall soundness as reported in the Statement of Net Position and the Statement of Activities.
FINANCIAL HIGHLIGHTS
Key financial highlights for fiscal year 2024 are as follows:
On the government-wide financial statements:
The School District's net position at June 30, 2024 was $149.2 million. Net position reflects the difference between all assets and deferred outflows of resources of the School District (including capital assets, net of depreciation) and all liabilities, both short-term and longterm, and deferred inflows of resources. The net position at June 30, 2024 of $149.2 million represented an increase of about $39.4 million when compared to the prior year. The primary reason for the increase in net position was attributable to general revenues and special item increasing by $35.3 million, as compared to the prior year, mainly due to an increase in property tax revenues from the prior year of $27.1 million and due to an increase in investment earnings from the prior year of $5.6 million.
The School District had almost $448.2 million in expenses relating to governmental activities; $257.8 million of the $448.2 million in expenses were offset by program specific charges for services, grants and contributions. However, general revenues (primarily property and sales taxes) of $229.7 million were adequate to provide for these programs.
As stated above, general revenues accounted for $229.7 million or about 47% of all revenues totaling $487.5 million. Program specific revenues in the form of charges for services, grants, and contributions accounted for the balance of these revenues. (Percentages in table below have been rounded to one decimal place.)
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HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024

Source of Revenues

General Revenue Property Taxes

33.1%

Program Revenues 52.9%

General Revenue Sales Taxes 9.6%

General Revenue All Other 4.4%
On the fund financial statements:
Among major funds, the general fund had almost $422.5 million in revenues and $403.6 million in expenditures. The general fund balance of $119.7 million at June 30, 2024 increased about $18.2 million from the prior year. The increase in fund balance was primarily attributable to an increase in property tax collections over the prior fiscal year by $24.6 million and an increase in the funds granted by state agencies over the prior fiscal year of almost $21.8 million.
OVERVIEW OF THE FINANCIAL STATEMENTS
These financial Statements consists of three parts; management's discussion and analysis (this section), the basic financial statements including notes to the financial statements and supplementary information. The basic financial statements include two levels of statements that present different views of the School District. These include the government-wide and fund financial statements.
The government-wide financial statements include the `Statement of Net Position' and `Statement of Activities'. These statements provide information about the activities of the School District presenting both short-term and long-term information about the School District's overall financial status.
The fund financial statements focus on individual parts of the School District, reporting the School District's operation in more detail. The `governmental funds' statements disclose how basic services are financed in the short-term as well as what remains for future spending. In the case of the Hall County School District, the general fund, capital projects funds, and debt service funds are all considered to be major funds. The School District has no funds reported as nonmajor funds as defined by generally accepted accounting principles.
The financial statements also include notes that explain some of the information in the statements and provide more detailed data. The statements are followed by a section of required supplementary information that further explains and supports the financial statements. Additionally, other supplementary information (not required) is also presented that further supplements understanding of the financial statements.

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HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024
Government-Wide Statements
Since Hall County School District has no operations that have been classified as "Business Activities", the Government-Wide financial statements are basically a consolidation of all of the School District's operating funds into one column called governmental activities. In reviewing the Government-Wide financial statements, a reader might ask the question, are we in a better financial position now than last year? The `Statement of Net Position' and the `Statement of Activities' provides the basis for answering this question. These financial statements include all School District's assets and liabilities and uses the accrual basis of accounting similar to the accounting used by most private-sector companies. This basis of accounting takes into account all of the current year's revenues and expenses regardless of when cash is received or paid.
These two statements report the School District's net position and any changes in net position. The change in net position is important because it tells the reader that, for the School District as a whole, the financial position of the School District has improved or diminished. The causes of this change may be the results of many factors, including those not under the School District's control, such as the property tax base, facility conditions, required educational programs, student-teacher ratios, and other factors.
When analyzing government-wide financial statements, it is important to remember these statements are prepared using an economic resources measurement focus (accrual accounting) and involve the following steps to format the Statement of Net Position:
Capitalize current outlays for capital assets Depreciate capital assets Report long-term debt, including pension and postemployment obligations, as a liability Calculate revenue and expense using the economic resources measurement focus and the accrual
basis of accounting Allocate net position as follows:
o Net Investment in capital assets o Restricted net position includes amounts with constraints placed on the use by external
sources such as creditors, grantors, contributors or laws and regulations. o Unrestricted for no specific use
Fund Financial Statements
The School District uses many funds or sub-funds to account for a multitude of financial transactions during the fiscal year. The fund financial statements presented in this report provide detail information about the School District's significant or major funds. As discussed previously, the School District has no nonmajor Funds as defined by generally accepted accounting principles.
The School District has one kind of fund as discussed below:
Governmental Funds The School District's activities are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end available for spending in future periods. These funds are reported using the modified accrual method of accounting which measures cash and all other financial assets that can be readily converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general government
iii

HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024
operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The differences between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds are reconciled in the financial statements.
FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT AS A WHOLE
Net position, which is the difference between total assets, deferred outflows of resources, total liabilities and deferred inflows of resources, is one indicator of the financial condition of the School District. When revenues exceed expenses, the result is an increase in net position. When expenses exceed revenues, the result is a decrease in net position. The relationship between revenues and expenses can be thought of as the School District's operating results. The School District's net position, as measured in the Statement of Net Position is one way to measure the School District's financial health, or financial position. Over time, increases or decreases in the School District's net position - as measured in the Statement of Activities - are one indicator of whether its financial health is improving or deteriorating. However, the School District's goal and mission is to provide success for each child's education, not to generate profits as private corporations do. For this reason, many other nonfinancial factors should be considered in assessing the overall health of the School District.
In the case of the Hall County School District, assets and deferred outflows of resources exceeded deferred inflows of resources and liabilities by about $149.2 million at June 30, 2024. To better understand the School District's actual financial position and ability to deliver services in future periods, it is necessary to review the various components of the net position category. For example, of the $149.2 million in net position, almost $96.7 million was restricted for continuation of various state and Federal programs, debt service and ongoing capital projects. Accordingly, these funds were not available to meet the School District's ongoing obligations to citizens and creditors.
In addition, the School District had $404.9 million (net of related debt) invested in capital assets (e.g., land, buildings, and equipment). The School District uses these capital assets to provide educational services to students within geographic boundaries served by the School District. Because of the very nature and on-going use of the assets being reported in this component of net position, it must be recognized that this portion of the net position is not available for future spending.
iv

HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024

Because of the restrictions on net position as discussed above, the School District had an unrestricted (deficit) of about $352.4 million at June 30, 2024. The reader should remember this deficit includes pension related charges recorded because of the implementation (fiscal year 2015) of GASB 68, Accounting and Financial Reporting for Pensions and GASB 71, Pension Transition for Contributions Made Subsequent to the Measurement Date on Amendment to GASB 68; and also includes charges recorded because of the implementation (fiscal year 2018) of GASB Statement 75, Accounting and Financial reporting for Postemployment Benefits Other than Pensions. The School District believes it is also meaningful to view the School District's net position in the following manner:

Net position associated with pension obligations

$

(236,984,207)

Net position associated with postemployment benefits other than pension obligations

(197,163,798)

Net position exclusive of pension obligations and postemployment benefits

583,348,673

Net Position, June 30, 2024

$

149,200,668

The above analysis shows that the recognition of liabilities for pension obligations and postemployment benefits on the financial statements has had a severe effect on the School District's unrestricted net position. However, despite these obligations, management believes the School District's financial position is sound.

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HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024

Table 1 provides a summary of the School District's net position for this fiscal year as compared to the prior fiscal year.

Table 1 Net Position

Assets Current and Other Assets Capital Assets, Net Total Assets

Governmental Activities

Fiscal Year

Fiscal Year

2024

2023

$

321,391,275 $

236,425,114

550,119,370

487,899,355

871,510,645

724,324,469

Deferred Outflows of Resources Related to Defined Benefit Pension Plan Related to OPEB Plan
Total Deferred Outflows of Resources Total Assets and Deferred Outflows of Resources

116,747,233 44,858,836
161,606,069 1,033,116,714

188,685,513 37,543,061
226,228,574 950,553,043

Liabilities Current and Other Liabilities Long-Term Liabilities Net Pension Liability Net OPEB Liability Total Liabilities

67,697,357 220,464,615 351,149,269 170,391,062 809,702,303

48,920,397 155,036,371 388,563,696 152,660,521 745,180,985

Deferred Inflows of Resources Related to Defined Benefit Pension Plan Related to OPEB Plan
Total Deferred Inflows of Resources Total Liabilities and Deferred Inflows of Resources

2,582,171 71,631,572 74,213,743 883,916,046

2,022,565 93,504,098 95,526,663 840,707,648

Net Position Invested in Capital Assets, Net of Debt Restricted Unrestricted (Deficit)

404,901,845 96,701,277
(352,402,454)

365,886,574 84,735,549
(340,776,728)

Total Net Position

$

149,200,668 $

109,845,395

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HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024

In connection with unrestricted (deficit) shown above at June 30, 2024, management presents the following additional information:

Total unrestricted net position (deficit) Less:
Unrestricted deficit in net position resulting from recognition of net pension obligations

$

(352,402,454)

236,984,207

Unrestricted deficit in net position resulting from recognition of postemployment benefits other than pension obligations

197,163,798

Unrestricted net position, exclusive of the net pension obligation and postemployment benefits effect

$

81,745,551

The above analysis reflects, except for pension obligations and postemployment benefits, the School District's unrestricted net position is a positive $81.7 million and accordingly, management believes the School District's financial position is sound.

vii

HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024

Table 2 provides a summary of the School District's net position for this fiscal year as compared to the prior fiscal year.

Table 2 Change in Net Position

Revenues Program Revenues: Charges for Services Operating Grants and Contributions Capital Grants and Contributions Total Program Revenues
General Revenues: Property Taxes Sales Taxes Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous
Loss on Disposal of Capital Assets Total General Revenues and Special Item Total Revenues and Special Item
Program Expenses Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Long-Term Debt Total Expenses

Governmental Activities

Fiscal Year

Fiscal Year

2024

2023

$

4,945,573 $

5,188,591

248,774,953

221,121,279

4,119,029

1,252,428

257,839,555

227,562,298

161,388,782 46,656,538 1,061,123 12,375,307 8,211,970 -
229,693,720 487,533,275

134,313,202 45,873,314 6,752,169 8,295,797 (870,586)
194,363,896 421,926,194

283,654,557
22,582,003 14,769,179
7,096,591 800,277
24,483,771 3,505,125
27,314,059 21,132,887
9,629,865 3,028,916
1,822,703 16,021
22,379,136 5,962,912
448,178,002

244,544,029
19,842,067 12,842,580
5,768,871 1,088,521 22,372,838 2,877,284 21,804,253 20,047,070 10,317,371 2,452,403
1,642,032 15,641
20,669,974 3,543,438
389,828,372

Increase in Net Position

$

39,355,273 $ 32,097,822

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HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024

Cost of Providing Services

The Statement of Activities shows the cost of program services and the charges for services and grants offsetting these services. Table 3 shows, for governmental activities, the total cost of services and the net cost of services. Net cost of services can be defined as the total cost less fees generated by the activities and intergovernmental revenue provided for specific programs. The net cost reflects the financial burden on the School District's taxpayers by each activity as compared to the prior fiscal year.

Table 3 Cost of Services

Total Cost of Services

Fiscal Year

Fiscal Year

2024

2023

Net Cost of Services

Fiscal Year

Fiscal Year

2024

2023

Instruction Support Services
Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Long-Term Debt

$ 283,654,557 $ 244,544,029 $ 97,912,089 $ 85,550,753

22,582,003 14,769,179
7,096,591 800,277
24,483,771 3,505,125 27,314,059
21,132,887 9,629,865 3,028,916

19,842,067 12,842,580
5,768,871 1,088,521 22,372,838 2,877,284 21,804,253 20,047,070 10,317,371 2,452,403

16,124,748 7,113,962 2,601,282 (3,910,167) 15,221,770 3,434,814 16,253,437 15,270,892 8,821,513 1,624,667

14,012,911 6,470,110 1,632,541 (3,644,303)
13,848,300 2,606,346 12,164,534
14,207,605 7,788,698 2,084,642

1,822,703 16,021
22,379,136 5,962,912

1,642,032 15,641
20,669,974 3,543,438

1,822,259 (125,500) 2,358,492 5,814,189

913,085 15,641 1,218,881 3,396,330

Total Expenses

$ 448,178,002 $ 389,828,372 $ 190,338,447 $ 162,266,074

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HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024

The table above shows the costs of services increased by $58.3 million from the prior year while the net costs of providing those services increased by almost $28.1 million. The reason the School Districts' net costs only increased by $28.1 million in comparison to the $58.3 million increase to the cost of services was that the School District derived an additional $27.7 million more revenue for operating grants in fiscal year 2024 when compared to the increased costs associated with additional compensation of $2,000 for each certified position and $1,000 for each classified position, and increases in the required School District contribution to health insurance premiums for the School District's classified and certified personnel.
The chart below shows a functional summary of the expenses made by the School District during fiscal year 2024. The percentages are rounded to one decimal place.

Governmental Activities -- Cost of Services

Instructional 63.3%

Support Services
30.0%

Interest on Debt 1.3%

All Others 0.4%
Food Services 5.0%

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT'S FUNDS
Information about the School District's governmental funds is presented starting on Exhibit "C" of this report. Governmental funds are accounted for using the modified accrual basis of accounting. The governmental funds had total revenues of almost $486.8 million and total expenditures of $495.2 million in fiscal year 2024. Total governmental fund balances of $265.3 million at June 30, 2024, increased about $77.6 million from the prior year, primarily due to the receipt of proceeds and premiums of $86.0 million from the issuance of the Series 2023 bonds, increased property tax receipts of $26.4 million, and increased state funding of $24.4 million.
General Fund Budget Highlights
The School District's budget is prepared according to Georgia Law. The most significant budgeted fund is the general fund. During the course of fiscal year 2024, the School District amended its general fund budget as needed.
The School District budget is adopted at the aggregate level and maintained at the program, function, object, and site levels to facilitate budgetary control. The budgeting systems are designed to control the total budget, but provide flexibility to meet the ongoing programmatic needs. The budgeting systems are also designed to control total site budgets but provide flexibility for site management as well.
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HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024

For the general fund, the final actual revenues of almost $422.5 million were more than the final budget by about $18.1 million. This variance resulted primarily from property tax revenues exceeding the final budgeted revenues by $2.9 million, state funds exceeding the final budgeted revenues by $4.0 million, federal funds exceeding the final budgeted revenues by $3.6 million, and miscellaneous revenue exceeding the final budget by $5.3 million.

The general fund's final actual expenditures of almost $403.6 million were less than the final budget by about $3.8 million. This situation was primarily the result of expenditures for instruction being less than the final budget by $8.5 million.

CAPITAL ASSETS AND LONG-TERM LIABILITIES

Capital Assets

At fiscal year ended June 30, 2024, the School District had $550.1 million invested in capital assets, net of accumulated depreciation, all in governmental activities. These assets are made up of a broad range of items including works of art; intangible assets; buildings; land; land improvements; and instructional, food service, transportation and maintenance equipment. Table 4 reflects a summary of these balances, net of accumulated depreciation and amortization, as compared to the prior fiscal year.

Table 4 Capital Assets at June 30
(Net of Depreciation)

Governmental Activities

Fiscal Year

Fiscal Year

2024

2023

Land Works of Art Construction in Progress Land Improvements Buildings and Improvements Equipment

$

33,682,241

219,670

86,410,893

30,651,105

376,582,030

22,573,431

$

33,749,565

219,670

82,376,687

28,203,051

322,839,886

20,510,496

Total

$ 550,119,370 $ 487,899,355

Additional information about the School District's capital assets can be found in the Notes to the Basic Financial Statements.

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HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024

Long-Term Liabilities
At June 30, 2024, the School District had $231.0 million in total debt outstanding which consisted of $196.0 million in various forms of bond debt, $31.1 million in unamortized bond premiums and $0.9 million in compensated absences debt. Table 5 summarizes the School District's debt as compared to the prior fiscal year.
Table 5 Change in Long-Term Debt

Governmental Activities

Fiscal Year

Fiscal Year

2024

2023

General Obligation Bonds Payable QSCB Bonds Payable (Intergovernmental Agreement) Unamortized Bond Premiums Compensated Absences
Total

$ 196,010,000 $ 124,135,000

3,000,000

3,000,000

31,105,778

26,951,080

907,540

950,291

$ 231,023,318 $ 155,036,371

At June 30, 2024, the School District's assigned bond rating was "Aa2" as determined by Moody's rating service.
Additional information about the School District's long-term liabilities can be found in the Notes to the Basic Financial Statements.
FACTORS BEARING ON THE SCHOOL DISTRICT'S FUTURE
Currently known circumstances that are expected to have a significant effect on financial position or results of operations in future years are as follows:
In 2001, Hall County voters authorized the creation of the Total School Tax Exemption for senior citizens, which exempted a property owner over the age of 75 from paying property taxes to the School District. The passage of subsequent resolutions reduced the age requirement to qualify for the exemption to 70 years of age. The passage of the resolution, in conjunction with other factors, has resulted in the significant growth of senior citizens as a greater proportion of Hall County's total population. As the proportion of senior citizens to the number of total citizens within the County grows, and as the population in Hall County follows expected national trends for aging in the coming years, the School District expects that the higher proportion of senior citizens within Hall County will reduce the School District's ability to harvest property tax revenue for each mill that it levies.

xii

HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024
In a November 2024 referendum, Hall County voters authorized the creation of a homestead property tax exemption that limits the annually assessed value of a primary residence to 3% of the prior year's assessed value, starting from the year of purchase. The School District expects that this limitation on the assessed value of residential properties within the County will reduce the School District's ability to harvest property tax revenues, over time, for each mill that it levies.
As part of its long term facilities plan, the School District has strategically identified several major capital outlay needs to accommodate anticipated student population growth in certain portions of the School District, to replace and consolidate its oldest facilities, and to renovate several existing facilities to provide a modern, quality education for its students. The School District is funding these capital outlay projects with proceeds from the one percent Education Special Purpose Local Option Sales Tax (ESPLOST), state capital outlay grants, and the proceeds generated from the issuance of up to $258.0 million in general obligation bonds. The issuance of up to $258.0 million in general obligation debt was approved by the voters of Hall County in a referendum on June 9th, 2020. Upon approval by the general public, the School District issued general obligation bonds, labeled "Series 2020," in August 2020, consisting of principal totaling $126.1 million, premiums totaling $31.5 million, with total proceeds from the sale of bonds being $157.6 million.
Since the issuance of the Series 2020 bonds, the price of construction materials has undergone significant inflation. The adverse impact of inflation has resulted in significant increases to the estimated costs of the construction projects.
To facilitate its capital outlay objectives, given current economic factors, the School District issued a second tranche of general obligation bonds, labeled "Series 2023," in October 2023, consisting of principal of $80.0 million, premiums totaling $6.0 million, with total proceeds from the sale of bonds being $86.0 million. The School District is authorized by the June 9th, 2020 referendum to issue a further $51.9 million of principal for capital outlay and estimates that it will need to issue the remaining available principal, during the fiscal year ended June 30, 2026.
The School District will continually evaluate economic conditions and their potential impact on its capital outlay projections in the coming months and years, and, if necessary, will reduce the scope of its construction plans or will implement cost cutting or taxation measures to maintain its financial health and stability while also balancing the needs of the boys and girls of Hall County.
The School District anticipates increased uncertainty going forward, due to inflationary factors on employee salaries and benefits, increasing state and local pressures to reduce the School District's ability to generate revenue, and greater volatility in economic conditions. However, the School District will continue to take measures, as appropriate, to be a good steward of tax dollars and maintain its financial position, while providing a quality education opportunity for the boys and girls of Hall County.
xiii

HALL COUNTY SCHOOL DISTRICT MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2024
CONTACTING THE SCHOOL DISTRICT'S FINANCIAL MANAGEMENT This financial report is designed to provide our citizens, taxpayers, investors and creditors with a general overview of the School District's finances and to show the School District's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Mr. Jonathan Boykin, Finance Officer, Hall County Board of Education, 711 Green Street, Gainesville, Georgia 30501. You may also email your questions to Mr. Jonathan Boykin at jonathan.boykin@hallco.org.
xiv

Hall County Board of Education

HALL COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2024
ASSETS Cash and Cash Equivalents Investments Accounts Receivable, Net
Taxes State Government Federal Government Other Inventories Prepaid Items Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation)
Total Assets
DEFERRED OUTFLOWS OF RESOURCES Related to Defined Benefit Pension Plan Related to OPEB Plan
Total Deferred Outflows of Resources
LIABILITIES Accounts Payable Salaries and Benefits Payable Interest Payable Claims Incurred but not Reported (IBNR) Contracts Payable Retainages Payable Deposits and Unearned Revenues Net Pension Liability Net OPEB Liability Long-Term Liabilities
Due Within One Year Due in More Than One Year
Total Liabilities
DEFERRED INFLOWS OF RESOURCES Related to Defined Benefit Pension Plan Related to OPEB Plan
Total Deferred Inflows of Resources
NET POSITION Net Investment in Capital Assets Restricted for
Continuation of Federal Programs Debt Service Capital Projects Unrestricted (Deficit)
Total Net Position

EXHIBIT "A"

GOVERNMENTAL ACTIVITIES

$

275,064,298.92

10,531.46

8,233,612.62 26,715,999.67
7,280,559.38 476,826.24 266,309.98
3,343,136.84 120,312,804.43 429,806,565.47 871,510,645.01

116,747,232.53 44,858,836.00
161,606,068.53

225,497.18 44,617,239.74
3,554,812.50 136,259.65
5,093,512.10 3,462,470.57
48,862.00 351,149,269.00 170,391,062.00
10,558,703.44 220,464,614.78 809,702,302.96

2,582,171.00 71,631,572.00 74,213,743.00

404,901,845.27

10,026,600.58 798,946.49
85,875,729.28 (352,402,454.04)

$

149,200,667.58

The notes to the basic financial statements are an integral part of this statement.

- 1 -

HALL COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2024

EXHIBIT "B"

EXPENSES

CHARGES FOR SERVICES

PROGRAM REVENUES OPERATING GRANTS AND
CONTRIBUTIONS

CAPITAL GRANTS AND CONTRIBUTIONS

NET (EXPENSES) REVENUES
AND CHANGES IN NET POSITION

GOVERNMENTAL ACTIVITIES

Instruction

$ 283,654,557.12 $

Support Services

Pupil Services

22,582,002.64

Improvement of Instructional Services

14,769,178.52

Educational Media Services

7,096,591.10

General Administration

800,277.21

School Administration

24,483,770.78

Business Administration

3,505,124.69

Maintenance and Operation of Plant

27,314,059.34

Student Transportation Services

21,132,887.18

Central Support Services

9,629,864.92

Other Support Services

3,028,916.36

Operations of Non-Instructional Services

Enterprise Operations

1,822,703.21

Community Services

16,020.50

Food Services

22,379,136.35

Interest on Long-Term Debt

5,962,912.17

1,941,641.91 $ 181,323,039.62 $

24,900.10 -

6,453,311.82 7,655,216.89 4,495,309.52 4,710,444.04 9,193,186.38
62,685.20 10,986,266.48
4,708,674.74 740,604.06
1,404,156.92

2,979,030.82 -

443.76 -
17,041,614.06 -

2,477,786.67 $
3,942.77 -
68,813.95 7,625.43
49,455.32 1,153,320.00
67,748.20 92.63
141,520.33
148,723.53

(97,912,088.92)
(16,124,748.05) (7,113,961.63) (2,601,281.58) 3,910,166.83
(15,221,770.45) (3,434,814.06)
(16,253,437.44) (15,270,892.44)
(8,821,512.66) (1,624,666.81)
(1,822,259.45) 125,499.83
(2,358,491.47) (5,814,188.64)

Total Governmental Activities

$ 448,178,002.09 $

4,945,572.83 $ 248,774,953.49 $

4,119,028.83

(190,338,446.94)

General Revenues Taxes Property Taxes For Maintenance and Operations For Debt Services Other Taxes Sales Taxes Special Purpose Local Option Sales Tax For Capital Projects Other Sales Tax Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous Total General Revenues

152,491,300.22 8,838,326.97 59,155.21
43,586,291.95 3,070,245.58 1,061,123.00
12,375,307.34 8,211,969.34
229,693,719.61

Change in Net Position

39,355,272.67

Net Position - Beginning of Year

109,845,394.91

Net Position - End of Year

$ 149,200,667.58

The notes to the basic financial statements are an integral part of this statement.

- 2 -

HALL COUNTY BOARD OF EDUCATION BALANCE SHEET
GOVERNMENTAL FUNDS JUNE 30, 2024

EXHIBIT "C"

ASSETS Cash and Cash Equivalents Investments Accounts Receivable, Net
Taxes State Government Federal Government Other Inventories Prepaid Items
Total Assets
LIABILITIES Accounts Payable Salaries and Benefits Payable Contracts Payable Retainages Payable Deposits and Unearned Revenues
Total Liabilities
DEFERRED INFLOWS OF RESOURCES Unavailable Revenue - Property Taxes
FUND BALANCES Nonspendable Restricted Assigned Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows of Resources, and Fund Balances

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$

124,736,678.03 $

148,066,558.71 $

10,531.46

-

4,346,267.84 26,715,999.67
7,280,559.38 476,826.24 266,309.98
3,343,136.84

3,745,387.98 -

$

167,176,309.44 $

151,811,946.69 $

2,261,062.18 $ -
141,956.80 -
2,403,018.98 $

275,064,298.92 10,531.46
8,233,612.62 26,715,999.67
7,280,559.38 476,826.24 266,309.98
3,343,136.84
321,391,275.11

$

225,497.18 $

44,617,239.74

-

-

48,862.00

44,891,598.92

- $ 5,093,512.10 3,462,470.57 8,555,982.67

- $ -

225,497.18 44,617,239.74
5,093,512.10 3,462,470.57
48,862.00 53,447,581.59

2,534,891.12

-

91,119.66

2,626,010.78

3,609,446.82 9,760,290.60 4,006,645.47 102,373,436.51 119,749,819.40

143,255,964.02
143,255,964.02

2,311,899.32
2,311,899.32

3,609,446.82 155,328,153.94
4,006,645.47 102,373,436.51 265,317,682.74

$

167,176,309.44 $

151,811,946.69 $

2,403,018.98 $

321,391,275.11

The notes to the basic financial statements are an integral part of this statement.

- 3 -

HALL COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET POSITION JUNE 30, 2024

EXHIBIT "D"

Total fund balances - governmental funds (Exhibit "C")
Amounts reported for governmental activities in the Statement of Net Position are different because:
Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds. Land Construction in progress Buildings and improvements Equipment Land improvements Intangible Assets Works of Art and Historical Collections Accumulated depreciation and amortization
Some liabilities are not due and payable in the current period and, therefore, are not reported in the funds. Net pension liability Net OPEB asset
Deferred outflows and inflows of resources related to pensions/OPEB are applicable to future periods and, therefore, are not reported in the funds. Related to pensions Related to OPEB
Taxes that are not available to pay for current period expenditures are deferred in the funds.
Long-term liabilities, and related accrued interest, are not due and payable in the current period and therefore are not reported in the funds. G.O. bonds payable Accrued interest payable QSCB bonds payable Compensated absences payable Unamortized bond premiums Claims and judgments payable
Net position of governmental activities (Exhibit "A")

$

265,317,682.74

$

33,682,241.01

86,410,893.42

518,586,068.12

49,705,755.33

57,103,030.64

37,477.50

219,670.00

(195,625,766.12)

550,119,369.90

$

(351,149,269.00)

(170,391,062.00)

(521,540,331.00)

$

114,165,061.53

(26,772,736.00)

87,392,325.53 2,626,010.78

$

(196,010,000.00)

(3,554,812.50)

(3,000,000.00)

(907,540.57)

(31,105,777.65)

(136,259.65)

(234,714,390.37)

$

149,200,667.58

The notes to the basic financial statements are an integral part of this statement.

- 4 -

HALL COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2024

EXHIBIT "E"

REVENUES Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous Total Revenues
EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operations Community Services Food Services Operation Capital Outlay Debt Services Principal Bond Issuance Costs Interest Total Expenditures
Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES) Proceeds of Bonds Premiums on Bonds Sold Transfers In Transfers Out Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$

151,518,607.69 $

2,882,269.02

190,700,570.75

60,769,098.28

4,945,572.83

5,127,254.32

6,540,073.17

422,483,446.06

- $ 43,586,291.95
2,656,485.30 -
7,126,157.96 1,671,896.17 55,040,831.38

8,784,451.01 $ 187,976.56 121,895.06 148,723.53
9,243,046.16

160,303,058.70 46,656,537.53
193,357,056.05 60,769,098.28 4,945,572.83 12,375,307.34 8,360,692.87
486,767,323.60

240,620,652.47
21,069,850.97 14,389,175.31
5,962,947.02 672,733.29
21,839,625.32 3,023,559.66
27,108,200.86 21,022,465.74
8,807,362.48 1,397,821.23 1,813,676.94
16,020.50 21,687,810.08 14,120,839.33
403,552,741.20 18,930,704.86

8,755,252.36
257,773.02 117,110.32 608,268.00 1,646,506.83 65,835,558.65
77,220,469.18 (22,179,637.80)

-
-
8,125,000.00 3,180.00
6,327,133.34 14,455,313.34 (5,212,267.18)

249,375,904.83
21,069,850.97 14,389,175.31
5,962,947.02 672,733.29
21,839,625.32 3,281,332.68
27,225,311.18 21,630,733.74
8,807,362.48 3,044,328.06 1,813,676.94
16,020.50 21,687,810.08 79,956,397.98
8,125,000.00 3,180.00
6,327,133.34 495,228,523.72
(8,461,200.12)

352.23 (732,324.00) (731,971.77)

80,000,000.00 6,016,314.20 576,324.00 (2,531,064.91)
84,061,573.29

18,198,733.09

61,881,935.49

101,551,086.31

81,374,028.53

$

119,749,819.40 $

143,255,964.02 $

2,686,712.68 2,686,712.68
(2,525,554.50)
4,837,453.82
2,311,899.32 $

80,000,000.00 6,016,314.20 3,263,388.91 (3,263,388.91)
86,016,314.20
77,555,114.08
187,762,568.66
265,317,682.74

The notes to the basic financial statements are an integral part of this statement.

- 5 -

HALL COUNTY BOARD OF EDUCATION RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES JUNE 30, 2024

EXHIBIT "F"

Net change in fund balances total governmental funds (Exhibit "E")
Amounts reported for governmental activities in the Statement of Activities are different because:
Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of capital assets is allocated over their estimated useful lives as depreciation expense. Capital outlay Depreciation expense
The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, donations, and disposals) is to decrease net position.
Taxes reported in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds.
Federal revenue deferred in the funds in the prior year but recognized as revenue in the current year.
The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts and the difference between the carrying value of refunded debt and the acquisition cost of refunded debt when debt is first issued. These amounts are deferred and amortized in the Statement of Activities. General obligation bonds issued, including a premium of $6,016,314.20 Bond principal retirements Amortization of bond premium
District pension/OPEB contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the reported net pension/OPEB liability is measured a year before the District's report date. Pension/OPEB expense, which is the change in the net pension/OPEB liability adjusted for changes in deferred outflows and inflows of resources related to pensions/OPEB, is reported in the Statement of Activities. Pension expense OPEB expense
Some items reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. Accrued interest on issuance of bonds Compensated absences Claims and judgments payable
Change in net position of governmental activities (Exhibit "B")

$

77,555,114.08

$

75,223,977.04

(12,695,641.21)

62,528,335.83 (308,320.70) 1,085,723.70 (345,685.00)

$

(86,016,314.20)

8,125,000.00

1,861,617.00

(76,029,697.20)

$

(35,083,459.47)

11,457,760.00

(23,625,699.47)

$

(1,497,395.83)

42,750.09

(49,852.83)

(1,504,498.57)

$

39,355,272.67

The notes to the basic financial statements are an integral part of this statement.

- 6 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

NOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY
Reporting Entity
The Hall County Board of Education (School District) was established under the laws of the State of Georgia and operates under the guidance of a board elected by the voters and a Superintendent appointed by the Board. The School District is organized as a separate legal entity and has the power to levy taxes and issue bonds. Its budget is not subject to approval by any other entity. Accordingly, the School District is a primary government and consists of all the organizations that compose its legal entity.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements of the School District have been prepared in conformity with generally accepted accounting principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB). GASB is the accepted standard-setting body for governmental accounting and financial reporting principles. The most significant of the School District's accounting policies are described below.
Basis of Presentation
The School District's basic financial statements are collectively comprised of the government-wide financial statements, fund financial statements and notes to the basic financial statements. The government-wide statements focus on the School District as a whole, while the fund financial statements focus on major funds. Each presentation provides valuable information that can be analyzed and compared between years and between governments to enhance the information's usefulness.
Government-Wide Statements:
The Statement of Net Position and the Statement of Activities display information about the financial activities of the overall School District. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions.
The Statement of Net Position presents the School District's assets, deferred outflows of resources, deferred inflows of resources and liabilities, with the difference reported as net position. Net position is reported in three categories as follows:
1. Net investment in capital assets consists of the School District's total investment in capital assets, net of accumulated depreciation, and reduced by outstanding debt obligations related to those capital assets. To the extent debt has been incurred but not yet expended for capital assets, such amounts are not included as a component of net investment in capital assets.
2. Restricted net position consists of resources for which the School District is legally or contractually obligated to spend in accordance with restrictions imposed by external third parties or imposed by law through constitutional provisions or enabling legislation.
3. Unrestricted net position consists of resources not meeting the definition of the two preceding categories. Unrestricted net position often has constraints on resources imposed by management which can be removed or modified.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the School District's governmental activities.
- 7 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expenses (expenses of the School District related to the administration and support of the School District's programs, such as office and maintenance personnel and accounting) are not allocated to programs.
Program revenues include (a) charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
Fund Financial Statements
The fund financial statements provide information about the School District's funds. Eliminations have been made to minimize the double counting of internal activities. The emphasis of fund financial statements is on major governmental funds, each displayed in a separate column.
The School District reports the following major governmental funds:
The general fund is the School District's primary operating fund. It accounts for and reports all financial resources not accounted for and reported in another fund.
The capital projects fund accounts for and reports financial resources including Education Special Purpose Local Option Sales Tax (ESPLOST), bond proceeds, and grants from the Georgia State Financing and Investment Commission that are restricted, committed or assigned for capital outlay expenditures, including the acquisition or construction of capital facilities and other capital assets.
The debt service fund accounts for and reports financial resources that are restricted, committed, or assigned including taxes (property and sales) legally restricted for the payment of general long-term principal and interest.
Basis of Accounting
The basis of accounting determines when transactions are reported on the financial statements. The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the School District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, sales taxes, grants and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from sales taxes is recognized in the fiscal year in which the underlying transaction (sale) takes place. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.
The School District uses funds to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts.
Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The School District considers certain revenues reported in the governmental funds to be
- 8 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

available if they are collected within 60 days after year-end. The School District considers all intergovernmental revenues to be available if they are collected within 120 days after year-end. Property taxes, sales taxes and interest are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred except for principal and interest on general long-term debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term liabilities are reported as other financing sources.
The School District funds certain programs by a combination of specific cost-reimbursement grants, categorical grants, and general revenues. Thus, when program costs are incurred, there are both restricted and unrestricted resources available to finance the program. It is the School District's policy to first apply grant resources to such programs, followed by cost-reimbursement grants, then general revenues.
New Accounting Pronouncements
In fiscal year 2024, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 100, Accounting Changes and Error Corrections. The objective of this statement is to enhance accounting and financial reporting requirements for accounting changes and error corrections to provide more understandable, reliable, relevant, consistent and comparable information for making decisions or assessing accountability. The adoption of this statement did not have a material impact on the School District's financial statements. This statement will be applied prospectively.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash on hand, demand deposits, investments in the State of Georgia local government investment pool (Georgia Fund 1) and short-term investments with original maturities of three months or less from the date of acquisition in authorized financial institutions. Official Code of Georgia Annotated (O.C.G.A.) 45-8-14 authorizes the School District to deposit its funds in one or more solvent banks, insured Federal savings and loan associations or insured chartered building and loan associations.
Investments
The School District can invest its funds as permitted by O.C.G.A. 36-83-4. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity.
Investments made by the School District in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. All other investments are reported at fair value.
For accounting purposes, certificates of deposit are classified as investments if they have an original maturity greater than three months when acquired.

- 9 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Receivables
Receivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. Receivables recorded on the basic financial statements do not include any amounts which would necessitate the need for an allowance for uncollectible receivables.
Inventories
Food Inventories
On the basic financial statements, inventories of donated food commodities used in the preparation of meals are reported at their Federally assigned value and purchased foods inventories are reported at cost (calculated on the first-in, first-out basis). The School District uses the consumption method to account for inventories whereby donated food commodities are recorded as an asset and as revenue when received, and expenses/expenditures are recorded as the inventory items are used. Purchased foods are recorded as an asset when purchased and expenses/expenditures are recorded as the inventory items are used.
Prepaid Items
Payments made to vendors for services that will benefit future accounting periods are recorded as prepaid items, in both the government-wide and governmental fund financial statements.
Capital Assets
On the government-wide financial statements, capital assets are recorded at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are recorded at the acquisition value on the date donated. The cost of normal maintenance and repairs that do not add to the value of assets or materially extend the useful lives of the assets is not capitalized. The School District does not capitalize book collections.
Capital acquisition and construction are recorded as expenditures in the governmental fund financial statements at the time of purchase (including ancillary charges), and the related assets are reported as capital assets in the governmental activities' column in the government-wide financial statements.
Depreciation is computed using the straight-line for all assets, except land, and is used to allocate the actual or estimated historical cost of capital assets over estimated useful lives.
Amortization of intangible assets such as water, timber and mineral rights, easements, patents, trademarks, copyrights, and internally generated software is computed using the straight-line method over the estimated useful lives of the assets.

- 10 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Capitalization thresholds and estimated useful lives of capital assets reported in the government-wide statements are as follows:

Capitalization Policy

Estimated Useful Life

Land

Works of Art

Land Improvements

$

Buildings and Improvements

$

Equipment

$

Intangible Assets

$

All All
5,000.00 100,000.00
5,000.00 100,000.00

N/A N/A 10 to 60 years 10 to 60 years 5 to 50 years Individually Determined

Deferred Outflows/Inflows of Resources
In addition to assets, the statement of financial position will report a separate section for deferred outflows of resources. This separate financial statement element represents a consumption of resources that applies to a future period(s) and therefore will not be recognized as an outflow of resources (expense/expenditure) until then.
In addition to liabilities, the statement of financial position will report a separate section for deferred inflows of resources. This separate financial statement element represents an acquisition of resources that applies to a future period(s) and therefore will not be recognized as an inflow of resources (revenue) until that time.
Compensated Absences
Compensated absences payable consists of vacation leave employees earned based on services already rendered.
Vacation leave of 15 days is awarded on a fiscal year basis to all full-time personnel employed on a twelve-month basis. No other employees are eligible to earn vacation leave. Vacation leave not utilized during the fiscal year may be carried over to the next fiscal year, providing such vacation leave does not exceed 15 days. Upon terminating employment, the School District pays all unused and unforfeited vacation benefits to employees. Accordingly, vacation benefits are accrued as a liability in the government-wide financial statements.
Members of the Teachers Retirement System of Georgia (TRS) may apply unused sick leave toward early retirement. The liability for early retirement will be borne by TRS rather than by the individual School Districts. Otherwise, sick leave does not vest with the employee, and no liability is reported in the School District's financial statements.
Long-Term Liabilities and Bond Discounts/Premiums
In the School District's government-wide financial statements, outstanding debt is reported as liabilities. Bond premiums and discounts and the difference between the reacquisition price and the net carrying value of refunded debt are deferred and amortized over the life of the bonds using the straightline method. Using the straight-line method is a departure from GAAP. To conform to generally accepted accounting principles, bond premiums and discounts should be amortized using the effective

- 11 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

interest method. The effect of this deviation is deemed to be immaterial to the fair presentation of the basic financial statements. Bond issuance costs are recognized as an outflow of resources in the fiscal year in which the bonds are issued.
In the governmental fund financial statements, the School District recognizes the proceeds of debt and premiums as other financing sources of the current period. Bond issuance costs are reported as debt service expenditures.
Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plan's fiduciary net position and additions to/deductions from the plan's fiduciary net position have been determined on the same basis as they are reported by the plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
Post-Employment Benefits Other than Pensions (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Georgia School Employees Post-Employment Benefit Fund (School OPEB Fund) and additions to/deductions from School OPEB Fund fiduciary net position have been determined on the same basis as they are reported by School OPEB Fund. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
Fund Balances
Fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent.
The School District's fund balances are classified as follows:
Nonspendable consists of resources that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact.
Restricted consists of resources that can be used only for specific purposes pursuant constraints either (1) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation.
Committed consists of resources that can be used only for specific purposes pursuant to constraints imposed by formal action of the Board. The Board is the School District's highest level of decisionmaking authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Committed fund balance also should incorporate contractual obligations to the extent that existing resources in the fund have been specifically committed for use in satisfying those contractual requirements.
Assigned consists of resources constrained by the School District's intent to be used for specific purposes but are neither restricted nor committed. The intent should be expressed by (1) the Board or (2) the budget or finance committee, or the Superintendent, or designee, to assign amounts to be used for specific purposes.

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HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Unassigned consists of resources within the general fund not meeting the definition of any aforementioned category. The general fund should be the only fund that reports a positive unassigned fund balance amount. In other governmental funds, it may be necessary to report a negative unassigned fund balance.
Use of Estimates
The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates.
Property Taxes
The Hall County Board of Commissioners adopted the property tax levy for the 2023 tax digest year (calendar year) on July 13, 2023 (levy date) based on property values as of January 1, 2023. Taxes were due on November 15, 2023 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2023 tax digest are reported as revenue in the governmental funds for fiscal year 2024. The Hall County Tax Commissioner bills and collects the property taxes for the School District, withholds 2.5% of taxes collected as a fee for tax collection and remits the balance of taxes collected to the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2024, for maintenance and operations amounted to $137,480,643.65 and for school bonds amounted to $8,784,451.01.
The tax millage rates levied for the 2023 tax digest year (calendar year) for the School District were as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations School Bonds

15.64 mills 1.00 mills

16.64 mills
Additionally, Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $13,978,808.83 during fiscal year ended June 30, 2024.
Sales Taxes
Education Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $43,586,291.95 and is to be used for capital outlay for educational purposes or debt service. This sales tax was authorized by local referendum and the sales tax must be re-authorized at least every five years. The most recent authorization expires September 30, 2027.
NOTE 3: BUDGETARY DATA
The budget is a complete financial plan for the School District's fiscal year and is based upon careful estimates of expenditures together with probable funding sources. The budget is legally adopted each year for the general, debt service, and capital projects funds. There is no statutory prohibition regarding over expenditure of the budget at any level. The budget for all governmental funds is prepared and adopted by fund, function and object. The legal level of budgetary control was established by the Board at the aggregate function level. The budget for the general fund was prepared in accordance with accounting principles generally accepted in the United States of America.
- 13 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

The budgetary process begins with the School District's administration presenting an initial budget for the Board's review. The administration makes revisions as necessary based on the Board's guidelines, and a tentative budget is approved. After approval of this tentative budget by the Board, such budget is advertised at least once in a newspaper of general circulation in the locality, as well as the School District's website. At the next regularly scheduled meeting of the Board after advertisement, the Board receives comments on the tentative budget, makes revisions as necessary and adopts a final budget. The approved budget is then submitted, in accordance with provisions of O.C.G.A. 20-2-167(c), to the Georgia Department of Education. The Board may increase or decrease the budget at any time during the year. All unexpended budget authority lapses at fiscal year-end.
Under no circumstance is the Superintendent or other staff person authorized to spend funds that exceed the total budget without approval by the Board.
See the General Fund Schedule of Revenues, Expenditures and Changes in Fund Balances Budget to Actual in the Supplementary Information Section for a detail of any over/under expenditures during the fiscal year 2024.
NOTE 4: DEPOSITS AND CASH EQUIVALENTS
Collateralization of Deposits
O.C.G.A. 45-8-12 provides that there shall not be on deposit at any time in any depository for a time longer than ten days a sum of money which has not been secured by surety bond, by guarantee of insurance, or by collateral. The aggregate of the face value of such surety bond and the market value of securities pledged shall be equal to not less than 110% of the public funds being secured after the deduction of the amount of deposit insurance. If a depository elects the pooled method (O.C.G.A. 45-8-13.1) the aggregate of the market value of the securities pledged to secure a pool of public funds shall be not less than 110% of the daily pool balance.
Acceptable security for deposits consists of any one of or any combination of the following:
(1) Surety bond signed by a surety company duly qualified and authorized to transact business within the State of Georgia,
(2) Insurance on accounts provided by the Federal Deposit Insurance Corporation,
(3) Bonds, bills, notes, certificates of indebtedness or other direct obligations of the United States or of the State of Georgia,
(4) Bonds, bills, notes, certificates of indebtedness or other obligations of the counties or municipalities of the State of Georgia,
(5) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose,
(6) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia, and
(7) Bonds, bills, notes, certificates of indebtedness, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest or debt obligations issued by or securities guaranteed by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association. - 14 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Categorization of Deposits
Custodial credit risk is the risk that in the event of a bank failure, the School District's deposits may not be returned to it. The School District does not have a deposit policy for custodial credit risk. At June 30, 2024, the School District had deposits with a carrying amount of $41,934,053.29, and a bank balance of $62,498,049.23. The bank balances insured by Federal depository insurance were $1,202,414.22.
At June 30, 2023, $61,295,635.01 of the School District's bank balances were exposed to custodial credit risk. This balance was in the State's Secure Deposit Program (SDP).
The School District participates in the State's Secure Deposit Program (SDP), a multi-bank pledging pool. The SDP requires participating banks that accept public deposits in Georgia to operate under the policy and procedures of the program. The Georgia Office of State Treasurer (OST) sets the collateral requirements and pledging level for each covered depository. There are four tiers of collateralization levels specifying percentages of eligible securities to secure covered deposits: 25%, 50%, 75%, and 110%. The SDP also provides for collateral levels to be increased in the amount of up to 125% if economic or financial conditions warrants. The program lists the types of eligible criteria. The OST approves authorized custodians.
In accordance with the SDP, if a covered depository defaults, losses to public depositors are first satisfied with any applicable insurance, followed by demands of payment under any letters of credit or sale of the covered depository collateral. If necessary, any remaining losses are to be satisfied by assessments made against the other participating covered depositories. Therefore, for disclosure purposes, all deposits of the SDP are considered to be fully collateralized.
Reconciliation of cash and cash equivalents balances to carrying value of deposits:

Cash and cash equivalents Statement of Net Position

$ 275,064,298.92

Add: Deposits with original maturity of three months or more reported as investments

10,531.46

Less: Investment pools reported as cash and cash equivalents
Georgia Fund 1

233,140,777.09

Total carrying value of deposits - June 30, 2024

$ 41,934,053.29

Categorization of Cash Equivalents
The School District reported cash equivalents of $233,140,777.09 in Georgia Fund 1, a local government investment pool, which is included in the cash balances above. Georgia Fund 1 is not registered with the SEC as an investment company and does not operate in a manner consistent with the SEC's Rule 2a-7 of the Investment Company Act of 1940. The investment is valued at the pool's share price, $1.00 per share, which approximates fair value. The pool is an AAAf rated investment pool by Fitch. The weighted average maturity of Georgia Fund 1 may not exceed 60 days. The weighted average maturity for Georgia Fund 1 on June 30, 2024 was 33 days.
- 15 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Georgia Fund 1, administered by the State of Georgia, Office of the State Treasurer, is not required to be categorized since the School District did not own any specific identifiable securities in the pool. The investment policy of the State of Georgia, Office of the State Treasurer for the Georgia Fund 1, does not provide for investment in derivatives or similar investments. Additional information on the Georgia Fund 1 is disclosed in the State of Georgia Annual Comprehensive Financial Report, which is publicly available at https://sao.georgia.gov/statewide-reporting/acfr.

NOTE 5: CAPITAL ASSETS

The following is a summary of changes in the capital assets for governmental activities during the fiscal year:

Balances July 1, 2023

Increases

Decreases

Transfers

Balances June 30, 2024

Governmental Activities Capital Assets,
Not Being Depreciated: Land Works of Art Construction in Progress

$ 33,749,564.74 $

- $ 67,323.73 $

- $

219,670.00

-

-

-

82,376,686.89 69,057,345.00

215,716.04

(64,807,422.43)

33,682,241.01 219,670.00
86,410,893.42

Total Capital Assets Not Being Depreciated

116,345,921.63 69,057,345.00

283,039.77

(64,807,422.43)

120,312,804.43

Capital Assets, Being Depreciated/Amortized Buildings and Improvements Equipment Land Improvements Intangible Assets
Less Accumulated Depreciation/Amortization: Buildings and Improvements Equipment Land Improvements Intangible Assets

456,661,700.46 45,814,178.79 52,595,065.37 37,477.50

4,541,721.54 1,624,910.50
-

650,145.00
-

61,924,367.66 -
2,883,054.77 -

518,586,068.12 49,705,755.33 57,103,030.64 37,477.50

133,821,814.55 25,303,682.54 24,392,014.39 37,477.50

8,182,223.35 2,453,506.31 2,059,911.55
-

624,864.07
-

-

142,004,037.90

-

27,132,324.78

-

26,451,925.94

-

37,477.50

Total Capital Assets, Being Depreciated/Amortized, Net

371,553,433.14 (6,529,009.17)

25,280.93

64,807,422.43

429,806,565.47

Governmental Activities Capital Assets - Net

$ 487,899,354.77 $ 62,528,335.83 $ 308,320.70 $

- $ 550,119,369.90

- 16 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Current year depreciation and amortization expense by function is as follows:

Instruction

$

Support Services

Pupil Services

$

17,769.34

School Administration

310,131.99

Business Administration

34,366.44

Maintenance and Operation of Plant

222,886.16

Student Transportation Services

1,192,684.48

Central Support Services

305,328.81

Other Support Services

417.46

Food Services

9,974,250.08
2,083,584.68 637,806.45

$ 12,695,641.21

NOTE 6: INTERFUND TRANSFERS Interfund transfers for the year ended June 30, 2024, consisted of the following:

Transfers to

General Fund

Transfers From
Capital Projects Fund

Total

General Fund Capital Projects Fund Debt Service Fund

$

- $

352.23 $

352.23

576,324.00

-

576,324.00

156,000.00

2,530,712.68

2,686,712.68

Total

$ 732,324.00 $ 2,531,064.91 $ 3,263,388.91

During fiscal year 2024 transfers were made for the following purposes:
1) A transfer of $576,324.00 was made from the general fund to the capital projects fund for the purpose of providing supplemental funding for certain School District capital outlay projects.
2) A transfer of $156,000.00 was made from the general fund to the debt service fund to prepay interest in advance of the due date.
3) A transfer of $352.23 was made from the capital projects fund to the general fund for the purpose of utilizing a residual balance from a restricted gift as specified by the Donor.
4) A transfer of $2,530,712.68 was made from the capital projects fund to the debt service fund to move sales tax proceeds to provide funds to pay debt service obligations due during the fiscal year.

- 17 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

NOTE 7: LONG-TERM LIABILITIES

The changes in long-term liabilities during the fiscal year for governmental activities were as follows:

Balance July 1, 2023

Additions

Governmental Activities

Balance

Deductions

June 30, 2024

Due Within One Year

General Obligation (G.O.) Bonds Unamortized Bond Premiums Qualified School Construction Bonds Compensated Absences

$ 124,135,000.00 $ 26,951,080.45 3,000,000.00 950,290.66

80,000,000.00 $ 6,016,314.20 907,540.57

8,125,000.00 $ 1,861,617.00
950,290.66

196,010,000.00 $ 31,105,777.65 3,000,000.00 907,540.57

8,535,000.00 1,953,703.44
70,000.00

$ 155,036,371.11 $ 86,923,854.77 $ 10,936,907.66 $ 231,023,318.22 $ 10,558,703.44

General Obligation Bonds

The School District's bonded debt consists of general obligation bonds that are generally callable with interest payable semiannually. Bond proceeds primarily pay for acquiring or constructing capital facilities. The School District repays general obligation bonds from voter-approved property and/or sales taxes. General obligation bonds are direct obligations and pledge the full faith and credit of the School District.

The School District's outstanding bonds related to governmental activities of $196,010,000.00 contain a provision that in the event of a nonpayment, the State Board is authorized to withhold from any state appropriation to which the School District may be entitled and apply so much thereof as shall be necessary to the payment of the principal and interest of such indebtedness then due.

Of the total amount of bonds authorized by the SPLOST V resolution $2,375,000.00 remains unissued at June 30, 2024. The School District has no plans to issue these bonds in the future.

During the current year, the School District issued general obligation bonds totaling $80,000,000.00 for the constructing and renovating schools within the district.

The issuance of the $80,000,000.00 in Series 2023 bonds during fiscal year 2024 was just a portion of the total amount of bonds authorized by the voters. The issuance of the $126,135,000.00 in Series 2020 bonds during fiscal year 2021 was just a portion of the total amount of bonds authorized by the voters. The School District is authorized to issue another $51,865,000.00 of bonds under authority of the referendum passed by voters on June 9, 2020.

General obligation bonds currently outstanding are as follows:

Description

Interest Rates

Issue Date

Maturity Date

Amount Issued

Amount Outstanding

General Government - Series 2020 General Government - Series 2023

1.00% - 5.00% 8/25/2020 5.00% 10/10/2023

2/1/2040 $ 126,135,000.00 $ 119,735,000.00

2/1/2040

80,000,000.00

76,275,000.00

$ 206,135,000.00 $ 196,010,000.00

- 18 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

The following schedule details debt service requirements to maturity for the School District's total general obligation bonds payable:

Fiscal Year Ended June 30:

General Obligation Debt

Principal

Interest

Unamortized Bond Premium

2025 2026 2027 2028 2029 2030 - 2034 2035 - 2039 2040

$ 8,535,000.00 $ 8,531,550.00 $

8,960,000.00

8,104,800.00

7,640,000.00

7,656,800.00

8,095,000.00

7,478,600.00

8,670,000.00

7,073,850.00

58,930,000.00

28,868,900.00

77,230,000.00

14,402,500.00

17,950,000.00

783,400.00

1,953,703.44 1,953,703.44 1,953,703.44 1,953,703.44 1,953,703.44 9,768,517.20 9,768,517.20 1,800,226.05

Total Principal and Interest $ 196,010,000.00 $ 82,900,400.00 $ 31,105,777.65

Qualified School Construction Bonds (QSCB)
Section 1521 of the American Recovery and Reinvestment Act (ARRA) of 2009 provides for a source of capital at no or at nominal interest rates for costs incurred by School Districts in connection with the construction, rehabilitation or repair of a public-school facility or for the acquisition of land where a school will be built. Investors receive Federal income tax credits at prescribed tax credit rates in lieu of interest, which essentially allows School Districts to borrow without incurring interest costs.
When the stated interest rate on the QSCB results in interest payments that exceed the supplemental interest, payments discussed in the preceding paragraph, the School District may apply for a direct cash subsidy payment from the U.S. Treasury which is intended to reduce the stated interest rate to a nominal percentage. To qualify for this subsidy the School District is required to periodically file appropriate documents with the Internal Revenue Service. These subsidy payments do not include the amount of any supplemental interest paid on a QSCB. The interest subsidy received by the School District in fiscal year 2024 was $148,723.53, which funded all but $7,276.47 of interest expense due on the QSCB.
In the event the amount of funds lawfully available is not sufficient to pay the QSCB payments when due in any year, the School District shall levy an ad valorem tax on all taxable property located within boundaries of the School District subject to taxation of such purposes, at such a rate or rates (subject to the 20 mills limitation) as may be necessary to produce in each calendar year revenues which shall be sufficient to fulfill the School District's obligations.
Debt currently outstanding under Qualified School Construction Bonds is as follows:

Description

Interest Rate

Issue Date

Maturity Date

Amount Issued

Amount Outstanding

QSCB (Intergovernmental Conduit Debt)

5.20% 10/25/2010 2/1/2028 $ 3,000,000.00 $ 3,000,000.00

- 19 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

The following is a schedule of total Qualified School Construction Bond payments:

Fiscal Year Ended June 30:

Principal

Interest

2025 2026 2027 2028

$

- $

-

-

3,000,000.00

156,000.00 156,000.00 156,000.00 156,000.00

Total Principal and Interest $ 3,000,000.00 $

624,000.00

Compensated Absences
Compensated absences represent obligations of the School District relating to employees' rights to receive compensation for future absences based upon service already rendered. This obligation relates only to vesting accumulating leave in which payment is probable and can be reasonably estimated. Typically, the general fund is the fund used to liquidate this long-term debt. The School District uses the vesting method to compute compensated absences.
NOTE 8: RISK MANAGEMENT
Insurance
Commercial Insurance
The School District is exposed to various risks of loss related to torts; theft of damage to and destruction of assets; errors or omissions; job related illness or injuries to employees; and natural disasters. Except as describe below, the School District carries commercial insurance for these risks. Settled claims resulting from these insured risks have not exceed commercial insurance coverage in any of the past three fiscal years.
The School District has elected to self-insure for losses related to workers compensation and unemployment compensation.
Georgia School Boards Association Risk Management Fund
The School District participates in the Georgia School Boards Association Risk Management Fund (the Fund), a public entity risk pool organized on August 1, 1994, to develop and administer a plan to reduce risk of loss on account of general liability, motor vehicle liability, errors and omissions liability, cyber risk and property damage, including safety engineering and other loss prevention and control techniques, and to administer the Fund including the processing and defense of claims brought against members of the Fund. The School District pays an annual contribution to the Fund for coverage. Reinsurance is provided to the Fund through agreements by the Fund with insurance companies according to their specialty for property (including coverage for flood and earthquake), machinery breakdown, general liability, errors and omissions, crime, cyber risk and automobile risks. Reinsurance limits and retentions vary by line of coverage.

- 20 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Workers' Compensation

The School District has established a limited risk management program for workers' compensation claims. A premium is charged when needed by the general fund to each user program on the basis of the percentage of that program's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The School District accounts for claims with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated. An excess coverage insurance policy covers individual claims in excess of $500,000.00 loss per occurrence, up to the statutory limit.

Changes in the workers' compensation claims liability during the last two fiscal years are as follows:

Beginning of Year Liability

Claims and Changes in
Estimates

Claims Paid

End of Year Liability

2023 $ 2024 $

68,869.47 $ 86,406.82 $

754,568.90 $ 887,251.84 $

737,031.55 $ 837,399.01 $

86,406.82 136,259.65

Unemployment Compensation

The School District is self-insured with regard to unemployment compensation claims. A premium is charged when needed by the general fund to each user program on the basis of the percentage of that fund's payroll to total payroll in order to cover estimated claims budgeted by management based on known claims and prior experience. The School District accounts for claims with expenses/expenditures and liability being reported when it is probable that a loss has occurred, and the amount of that loss can be reasonably estimated.

Changes in the unemployment compensation claims liability during the last two fiscal years are as follows:

Beginning of Year Liability

Claims and Changes in
Estimates

Claims Paid

End of Year Liability

2023 $

- $

3,315.78 $

3,315.78 $

-

2024 $

- $

1,323.88 $

1,323.88 $

-

Surety Bond

The School District purchased a surety bond to provide additional insurance coverage as follows:

Position Covered

Amount

Superintendent

$

25,000.00

- 21 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

NOTE 9: FUND BALANCE CLASSIFICATION DETAILS
The School District's financial statements include the following amounts presented in the aggregate at June 30, 2024:

Nonspendable Inventories Prepaid Assets
Restricted Continuation of Federal Programs Capital Projects Debt Service
Assigned School Activity Accounts
Unassigned

$

266,309.98

3,343,136.84 $

3,609,446.82

$

9,760,290.60

141,305,224.01

4,262,639.33

155,328,153.94

4,006,645.47 102,373,436.51

Fund Balance, June 30, 2024

$ 265,317,682.74

When multiple categories of fund balance are available for an expenditure, the School District will start with the most restricted category and spend those funds first before moving down to the next category with available funds.

- 22 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

NOTE 10: SIGNIFICANT COMMITMENTS
Commitments under Construction Contracts The following is an analysis of significant outstanding construction or renovation contracts executed by the School District as of June 30, 2024, together with funding available:

Project

Unearned Executed Contracts (1)

Payments through June 30, 2024 (2)

Funding Available From State (1)

Academies of Discovery Renovation 2024

$

Chestnut Mountain Elementary Site Improvements

Chicopee Woods Elementary Learning Commons Renovations

Davis Middle Site Improvements

East Hall High School Addition and Renovation

Flowery Branch High School Rest Room Renovations Phase II

Johnson High School Additions and Renovations

Lanier College and Career Academy Addition

Lyman Hall Elementary Addition

Myers Elementary School Renovations

New Elementary School Replacement No. 2

North Hall Middle School Band Room Renovations

Sardis Elementary Schoool Paving

West Hall Middle School Renovations to Bldg 4010

1,231,855.07 $ 498,241.05 339,735.17 535,569.48
1,314,710.80 183,198.00 69,776.00 609,400.25 575,378.84 763,110.00
23,611,641.38 29,570.00
171,250.00 242,350.00

1,138,767.51 $ 150,397.73 210,475.55 247,405.11
35,027,075.44 251,578.00 315,223.00
10,271,647.75 14,054,547.16
1,096,758.00 14,373,365.09
126,177.77 -
25,650.00

258,746.70 -

$ 30,175,786.04 $ 77,289,068.11 $ 258,746.70

(1) The amounts described are not reflected in the basic financial statements. (2) Payments include contracts and retainages payable at year-end.

NOTE 11: SIGNIFICANT CONTINGENT LIABILITIES
Federal Grants
Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any costs which are disallowed under grant terms. Any disallowances resulting from the grantor audit may become a liability of the School District. However, the School District believes that such disallowances, if any, will be immaterial to its overall financial position.
Litigation
The School District is a defendant in various legal proceedings pertaining to matters incidental to the performance of routine School District operations. The ultimate disposition of these proceedings is not presently determinable but is not believed to have a material adverse effect on the financial condition of the School District.

- 23 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

NOTE 12: OTHER POST-EMPLOYMENT BENEFITS (OPEB)
Georgia School Personnel Post-Employment Health Benefit Fund
Plan Description: Certified teachers and non-certified public school employees of the School District as defined in 20-2-875 of the Official Code of Georgia Annotated (O.C.G.A.) are provided OPEB through the School OPEB Fund - a cost-sharing multiple-employer defined benefit post-employment healthcare plan, reported as an employee trust fund and administered by a Board of Community Health (Board). Title 20 of the O.C.G.A. assigns the authority to establish and amend the benefit terms of the group health plan to the Board.
Benefits Provided: The School OPEB Fund provides healthcare benefits for retirees and their dependents due under the group health plan for public school teachers, including librarians, other certified employees of public schools, regional educational service agencies and non-certified public school employees. Retiree medical eligibility is attained when an employee retires and is immediately eligible to draw a retirement annuity from Employees' Retirement System (ERS), Georgia Judicial Retirement System (JRS), Legislative Retirement System (LRS), Teachers Retirement System (TRS) or Public School Employees Retirement System (PSERS). If elected, dependent coverage starts on the same day as retiree coverage. Medicare-eligible retirees are offered Standard and Premium Medicare Advantage plan options. Non-Medicare eligible retiree plan options include Health Reimbursement Arrangement (HRA), Health Maintenance Organization (HMO) and a High Deductible Health Plan (HDHP). The School OPEB Fund also pays for administrative expenses of the fund. By law, no other use of the assets of the School OPEB Fund is permitted.
Contributions: As established by the Board, the School OPEB Fund is substantially funded on a payas-you-go basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions to the School OPEB Fund from the School District were $6,323,392.00 for the year ended June 30, 2024. Active employees are not required to contribute to the School OPEB Fund.
OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB
At June 30, 2024, the School District reported a liability of $170,391,062.00 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2023. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2022. An expected total OPEB liability as of June 30, 2023 was determined using standard roll-forward techniques. The School District's proportion of the net OPEB liability was actuarially determined based on employer contributions during the fiscal year ended June 30, 2023. At June 30, 2023, the School District's proportion was 1.555598%, which was an increase of 0.014068% from its proportion measured as of June 30, 2022.

- 24 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

For the year ended June 30, 2024, the School District recognized OPEB expense of ($5,134,368.00). At June 30, 2024, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

OPEB Deferred Outflows of Resources

Deferred Inflows of Resources

Differences between expected and actual experience

$ 4,966,617.00 $ 48,938,315.00

Changes of assumptions

30,956,706.00

21,279,259.00

Net difference between projected and actual

earnings on OPEB plan investments

102,226.00

-

Changes in proportion and differences between School District contributions and proportionate share of contributions

2,509,895.00

1,413,998.00

School District contributions subsequent to

the measurement date

6,323,392.00

-

Total

$ 44,858,836.00 $ 71,631,572.00

School District contributions subsequent to the measurement date are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2025. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Year Ended June 30:

OPEB

2025 2026 2027 2028 2029 Thereafter

$ (11,662,215.00)

$ (8,532,102.00)

$ (10,740,133.00)

$ (4,099,865.00)

$ 1,618,405.00

$

319,782.00

- 25 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Actuarial Assumptions: The total OPEB liability as of June 30, 2023 was determined by an actuarial valuation as of June 30, 2022 using the following actuarial assumptions and other inputs, applied to all periods included in the measurement and rolled forward to the measurement date of June 30, 2023:

OPEB:

Inflation

2.50%

Salary increases

3.00% 8.75%, including inflation

Long-term expected rate of return

7.00%, compounded annually, net of investment expense, and including inflation

Healthcare cost trend rate

7.00%

Ultimate trend rate

4.50%

Year of Ultimate trend rate

2032

The Plan currently uses mortality tables that vary by age, gender, and health status (i.e. disabled or not disabled) as follows:
For TRS members: Post-retirement mortality rates for service retirements and beneficiaries were based on the Pub-2010 Teachers Headcount Weighted Below Median Healthy Retiree mortality table (ages set forward one year and adjusted 106%) with the MP-2019 Projection scale applied generationally. The rates of improvement were reduced by 20% for all years prior to the ultimate rate. Post-retirement mortality rates for disability retirements were based on the Pub-2010 Teachers Mortality Table for Disabled Retirees (ages set forward one year and adjusted 106%) with the MP-2019 Projection scale applied generationally. The rates of improvement were reduced by 20% for all years prior to the ultimate rate. The Pub-2010 Teachers Headcount Weighted Below Median Employee mortality table with ages set forward one year and adjusted 106% was used for death prior to retirement. Future improvement in mortality rates was assumed using the MP-2019 Projection scale generationally. These rates of improvement were reduced by 20% for all years prior to the ultimate rate.
For PSERS members: Pre-retirement mortality rates were based on the Pub-2010 General Employee Mortality Table, with no adjustment, with the MP-2019 Projection scale applied generationally. Post-retirement mortality rates for service retirements were based on the Pub-2010 General Healthy Annuitant Mortality Table (ages set forward one year and adjusted 101% for males and 103% for females) with the MP-2019 Projection scale applied generationally. Postretirement mortality rates for disability retirements were based on the Pub-2010 General Disabled Mortality Table (ages set back three years for males and adjusted 103% for males and 106% for females) with the MP-2019 Projection scaled applied generationally. Postretirement mortality rates for beneficiaries were based on the Pub-2010 General Contingent Survivor Mortality Table (ages set forward two years and adjusted 104% for males and 99% for females) with the MP-2019 Projection scale applied generationally.

- 26 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

The actuarial assumptions used in the June 30, 2022 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2018, with the exception of the assumed annual rate of inflation, which was changed from 2.75% to 2.50%, effective with the June 30, 2018 valuation.

The remaining actuarial assumptions (e.g., initial per capita costs, health care cost trends, rate of plan participation, rates of plan election, etc.) used in the June 30, 2022 valuation were based on a review of recent plan experience done concurrently with the June 30, 2022 valuation.

Projection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculation.

The long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset Class

Target Allocation

Long-Term Expected Real Rate of Return*

Fixed income Equities

30.00% 70.00%

1.50% 9.40%

Total

100.00%

* Net of inflation
Discount Rate: In order to measure the total OPEB liability for the School OPEB, a single equivalent interest rate of 3.68% was used as the discount rate, as compared with last year's rate of 3.57%. The plan's fiduciary net position was projected to not be able to make all future benefit payments of current plan members. Therefore, the municipal bond rate as used for the long-term rate of return was applied to all periods of projected benefit payments to determine total OPEB liability. This is comprised mainly of the yield or index rate for 20 year tax-exempt general obligation bonds with an average rating of AA or higher (3.65% per the Municipal Bond Index Rate). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employers will be made at the current level as averaged over the last five years, adjusted for annual projected changes in headcount. Projected future benefit payments for all current plan members were projected through 2128.

- 27 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Sensitivity of the School District's Proportionate Share of the Net OPEB Liability to Changes in the Discount Rate: The following presents the School District's proportionate share of the net OPEB liability calculated using the discount rate of 3.68%, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (2.68%) or 1-percentage-point higher (4.68%) than the current discount rate:

1% Decrease (2.68%)

Current Discount Rate (3.68%)

1% Increase (4.68%)

School District's proportionate share of the Net OPEB liability

$ 193,146,130.00 $ 170,391,062.00 $ 151,226,485.00

Sensitivity of the School District's Proportionate Share of the Net OPEB Liability to Changes in the Healthcare Cost Trend Rates: The following presents the School District's proportionate share of the net OPEB liability, as well as what the School District's proportionate share of the net OPEB liability would be if it were calculated using healthcare cost trend rates that are 1percentage-point lower or 1-percentage-point higher than the current healthcare cost trend rates:

1% Decrease

Current Healthcare Cost Trend Rate

1% Increase

School District's proportionate share of the Net OPEB liability

$ 146,769,310.00 $ 170,391,062.00 $ 199,511,592.00

OPEB Plan Fiduciary Net Position: Detailed information about the OPEB plan's fiduciary net position is available in the Annual Comprehensive Financial Report, which is publicly available at https://sao.georgia.gov/statewide-reporting/acfr.

NOTE 13: RETIREMENT PLANS
The School District participates in various retirement plans administered by the State of Georgia, as further explained below.

Teachers Retirement System of Georgia (TRS)
Plan Description: All teachers of the School District as defined in O.C.G.A. 47-3-60 and certain other support personnel as defined by O.C.G.A. 47-3-63 are provided a pension through the Teachers Retirement System of Georgia (TRS). TRS, a cost-sharing multiple-employer defined benefit pension plan, is administered by the TRS Board of Trustees (TRS Board). Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. The Teachers Retirement System of Georgia issues a publicly available separate financial report that can be obtained at www.trsga.com/publications.
Benefits Provided: TRS provides service retirement, disability retirement, and death benefits. Normal retirement benefits are determined as 2% of the average of the employee's two highest paid consecutive years of service, multiplied by the number of years of creditable service up to 40 years. An employee is eligible for normal service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. Ten years of service is required for disability and death benefits eligibility. Disability benefits are based on the employee's creditable service and

- 28 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

compensation up to the time of disability. Death benefits equal the amount that would be payable to the employee's beneficiary had the employee retired on the date of death. Death benefits are based on the employee's creditable service and compensation up to the date of death.
Contributions: Per Title 47 of the O.C.G.A., contribution requirements of active employees and participating employers, as actuarially determined, are established and may be amended by the TRS Board. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6.00% of their annual pay during fiscal year 2024. The School District's contractually required contribution rate for the year ended June 30, 2024 was 19.96% of annual School District payroll, of which 19.94% of payroll was required from the School District and 0.02% of payroll was required from the State. For the current fiscal year, employer contributions to the pension plan were $36,231,506.53 and $68,109.54 from the School District and the State, respectively.
Public School Employees Retirement System (PSERS)
Plan Description: PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. PSERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/financials.
Benefits Provided: A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service.
Upon retirement, the member will receive a monthly benefit of $16.00, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits.
Contributions: The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. 47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability.
Individuals who became members prior to July 1, 2012, contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012, contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. The current fiscal year contribution was $457,493.00.

- 29 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

At June 30, 2024, the School District reported a liability of $351,149,269.00 for its proportionate share of the net pension liability for TRS.

The TRS net pension liability reflected a reduction for support provided to the School District by the State of Georgia for certain public school support personnel. The amount recognized by the School District as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School District were as follows:

School District's proportionate share of the net pension liability

$ 351,149,269.00

State of Georgia's proportionate share of the net pension liability associated with the School District

646,582.00

Total

$ 351,795,851.00

The net pension liability for TRS was measured as of June 30, 2023. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2022. An expected total pension liability as of June 30, 2023 was determined using standard roll-forward techniques. The School District's proportion of the net pension liability was based on contributions to TRS during the fiscal year ended June 30, 2023.
At June 30, 2023, the School District's TRS proportion was 1.189357%, which was a decrease of 0.007257% from its proportion measured as of June 30, 2022.
At June 30, 2024, the School District did not have a PSERS liability for a proportionate share of the net pension liability because of a Special Funding Situation with the State of Georgia, which is responsible for the net pension liability of the plan. The amount of the State's proportionate share of the net pension liability associated with the School District is $2,589,783.00.
The PSERS net pension liability was measured as of June 30, 2023. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2022. An expected total pension liability as of June 30, 2023 was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School District was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2023.
For the year ended June 30, 2024, the School District recognized pension expense of $71,399,062.67 for TRS, and $467,418.00 for PSERS and revenue of $84,097.00 for TRS and $467,418.00 for PSERS. The revenue is support provided by the State of Georgia. For TRS the State of Georgia support is provided only for certain support personnel.

- 30 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

At June 30, 2024, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

TRS Deferred Outflows of Resources

Deferred Inflows of Resources

Differences between expected and actual

experience

$ 17,830,888.00 $ 1,451,884.00

Changes of assumptions

36,125,720.00

-

actual earnings on pension plan investments

24,697,272.00

-

Changes in proportion and differences between School District contributions and proportionate share of contributions

1,861,846.00

1,130,287.00

School District contributions subsequent to

the measurement date

36,231,506.53

-

Total

$ 116,747,232.53 $ 2,582,171.00

The School District contributions subsequent to the measurement date for TRS are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended June 30, 2025. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended June 30:

TRS

2025 2026 2027 2028

$ 23,473,293.00 $ 15,313,124.00 $ 47,946,348.00 $ (8,799,210.00)

- 31 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Actuarial Assumptions: The total pension liability as of June 30, 2023 was determined by an actuarial valuation as of June 30, 2022, using the following actuarial assumptions, applied to all periods included in the measurement:

Teachers Retirement System:

Inflation

2.50%

Salary increases

3.00% 8.75%, average, including inflation

Investment rate of return

6.90%, net of pension plan investment expense, including inflation

Post-retirement benefit increases

1.50% semi-annually

Post-retirement mortality rates for service retirements and beneficiaries were based on the Pub-2010 Teachers Headcount Weighted Below Median Healthy Retiree mortality table (ages set forward one year and adjusted 106%) with the MP-2019 Projection scale applied generationally. The rates of improvement were reduced by 20% for all years prior to the ultimate rate. Post-retirement mortality rates for disability retirements were based on the Pub-2010 Teachers Mortality Table for Disabled Retirees (ages set forward one year and adjusted 106%) with the MP-2019 Projection scale applied generationally. The rates of improvement were reduced by 20% for all years prior to the ultimate rate. The Pub-2010 Teachers Headcount Weighted Below Median Employee mortality table with ages set forward one year and adjusted 106% as used for death prior to retirement. Future improvement in mortality rates was assumed using the MP-2019 Projection scale generationally. These rates of improvement were reduced by 20% for all years prior to the ultimate rate.

The actuarial assumptions used in the June 30, 2022 valuation were based on the results of an actuarial experience study for the period July 1, 2013 June 30, 2018.

Public School Employees Retirement System:

Inflation

2.50%

Salary increases Investment rate of return

N/A
7.00%, net of pension plan investment expense, including inflation

Post-retirement benefit increases

1.50% semi-annually

- 32 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Mortality rates are as follows:
The Pub-2010 General Employee Table, with no adjustments, projected generationally with the MP-2019 scale is used for both males and females while in active service.
The Pub-2010 Family of Tables projected generationally with the MP-2019 Scale and with further adjustments are used for post-retirement mortality assumptions as follows:

Participant Type

Membership Table

Set Forward (+)/ Setback (-) Adjustment to Rates

Service Retirees

General Healthy BelowMedian Annuitant

Male: +2; Female: +2

Male: 101%; Female: 103%

Disability Retirees

General Disabled

Male: -3; Female: 0

Male: 103%; Female: 106%

Beneficiaries

General Below-Median Contingent Survivors

Male: +2; Female: +2

Male: 104%; Female: 99%

The actuarial assumptions used in the June 30, 2022 valuation was based on the results of an actuarial experience study for the period July 1, 2014 June 30, 2019.

The long-term expected rate of return on TRS and PSERS pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset Class

TRS/PSERS Target
Allocation

Long-Term Expected Real Rate of Return*

Fixed income Domestic large stocks Domestic small stocks International developed market stocks International emerging market stocks Alternative

30.00% 46.30%
1.20% 12.30%
5.20% 5.00%

0.90% 9.40% 13.40% 9.40% 11.40% 10.50%

Total

100.00%

* Rates shown are net of inflation

- 33 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

Discount Rate: The discount rate used to measure the total TRS pension liability was 6.90%. The discount rate used to measure the total PSERS pension liability was 7.00%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the TRS and PSERS pension plans' fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the School District's Proportionate Share of the Net Pension Liability to Changes in the Discount Rate: The following presents the School District's proportionate share of the net pension liability calculated using the discount rate of 6.90%, as well as what the School District's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (5.90%) or 1-percentage-point higher (7.90%) than the current rate:

Teachers Retirement System:

1% Decrease (5.90%)

Current Discount Rate (6.90%)

1% Increase (7.90%)

School District's proportionate share of the net pension liability

$ 555,207,844.00 $

351,149,269.00 $ 184,507,972.00

Pension Plan Fiduciary Net Position: Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS and PSERS financial report which is publicly available at www.trsga.com/publications and www.ers.ga.gov/financials.

Defined Contribution Plan
The Hall County Board of Education maintains an employer paid 403(b) annuity plan for the group of employees covered under the Public School Employees' Retirement System (PSERS). Recognizing that PSERS was a limited defined contribution and defined benefit plan which did not provide for an adequate retirement for this group of employees, it was the Board's desire to supplement the retirement of this group.
The Board selected The Variable Annuity Life Insurance Company (Valic) as the provider of this plan. For each employee covered under PSERS, the Board contributes to the plan an amount equal to 5% percent of the employee's base pay.
The employee becomes vested in the plan immediately. Funds accumulated in the employer paid accounts are only available to the employee upon termination of employment.
Employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2024 2023 2022

5%

$

223,870.27

5%

$

218,763.66

5%

$

197,297.88

- 34 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2024

EXHIBIT "G"

NOTE 14: TAX ABATEMENTS
The Gainesville and Hall County Development Authority (the "Authority") can enter into agreements for industrial projects to encourage the creation of jobs and new capital investment through an "Investment Assistance Program." Each agreement provides a property tax benefit to the company through a schedule of discounted valuation that reduces, for ad valorem tax purposes, the fair market value of real and personal property that is held by the Authority and leased to the company. Georgia case law and the Authority's enabling legislation provide the Authority with the power to enter into such agreements with private companies.
The Authority may accept title to real and personal property assets from a company in return for job creation and capital investment and provide a tax benefit to the company through a lease agreement with the Authority. In considering eligibility for providing this benefit to a company, the Authority reviews and gives strong consideration to the recommendation from the Investment Assistance Committee of the Gainesville-Hall County Economic Development Council. The Investment Assistance Committee is a 16-member advisory committee of representatives from the City of Gainesville School District, the Hall County School District, Hall County, the cities of Gainesville, Flowery Branch, Oakwood, Lula and the Authority. The Investment Assistance Committee has a set of eligibility criteria for considering economic development projects that includes the following criteria:
1. Eligible businesses can include new and existing industrial businesses. 2. But for an incentive agreement, the company would not create the jobs and investment in
the community. 3. The investment should be at least $10,000,000.00 in real and personal property. For
investment projects considered after March 2023, the investment should be at least $25,000,000.00 in real and personal property. 4. The average wage of the business' employees should be above the average wage of goods producing employees in Hall County. 5. The business should offer medical benefits to all employees. 6. The impact to job retention will be considered for each expansion project. 7. As a condition of assistance, a business will be required to work with the Gainesville and Hall County Development Authority to convey title to the Authority.
In return for a property tax benefit, a company is required to commit to creating jobs and capital investment within a defined period as part of a performance and accountability agreement with the Authority that includes provisions for the company to pay back a prorated portion of the benefit if they fail to meet the performance criteria by a specified date. The Authority monitors compliance with performance and accountability agreements to ensure the companies meet their commitments.
For the School District's fiscal year ended June 30, 2024, the cumulative property tax not collected by the School District due to incentive agreements was $685,285.00 and $565,806.00 was paid to the School District through incentive agreements for the same period. Such agreements in effect resulted in an estimated $400.0 million in new capital investment and more than 1,350 new jobs.

- 35 -

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HALL COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA

SCHEDULE "1"

For the Year Ended
June 30

School District's proportion
of the Net Pension Liability (NPL)

School District's proportionate share
of the NPL

State of Georgia's proportionate share
of the NPL associated with the
School District

Total

School District's covered payroll

School District's proportionate share of the NPL as a percentage of its covered payroll

Plan fiduciary net position as a percentage
of the total pension liability

2024 2023 2022 2021 2020 2019 2018 2017 2016 2015

1.189357% $ 351,149,269.00 $

646,582.00 $ 351,795,851.00 $ 173,670,524.64

1.196614% $ 388,563,696.00 $

732,892.00 $ 389,296,588.00 $ 162,048,488.83

1.180428% $ 104,400,983.00 $

201,209.00 $ 104,602,192.00 $ 153,882,421.56

1.177924% $ 285,339,297.00 $

594,939.00 $ 285,934,236.00 $ 152,089,597.34

1.176602% $ 253,001,245.00 $

561,221.00 $ 253,562,466.00 $ 143,908,233.09

1.166091% $ 216,451,467.00 $

446,420.00 $ 216,897,887.00 $ 139,175,704.63

1.150373% $ 213,800,365.00 $ 2,334,129.00 $ 216,134,494.00 $ 133,561,656.27

1.156913% $ 238,684,051.00 $ 3,756,513.00 $ 242,440,564.00 $ 128,906,363.37

1.164626% $ 177,302,744.00 $ 2,678,664.00 $ 179,981,408.00 $ 124,781,368.61

1.166769% $ 147,405,873.00 $ 2,057,648.00 $ 149,463,521.00 $ 120,694,862.00

202.19% 239.78%
67.84% 187.61% 175.81% 155.52% 160.08% 185.16% 142.09% 122.13%

76.29% 72.85% 92.03% 77.01% 78.56% 80.27% 79.33% 76.06% 81.44% 84.03%

- 37 -

HALL COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA

SCHEDULE "2"

For the Year Ended June 30

Contractually required contribution

Contributions in relation to the contractually required
contribution

Contribution deficiency (excess)

School District's covered payroll

Contribution as a percentage of covered
payroll

2024

$

36,231,506.53 $

2023

$

34,645,210.00 $

2022

$

32,041,383.00 $

2021

$

29,273,496.00 $

2020

$

32,084,794.00 $

2019

$

30,015,690.14 $

2018

$

23,347,276.94 $

2017

$

18,853,460.00 $

2016

$

18,112,226.00 $

2015

$

16,167,196.67 $

36,231,506.53 $ 34,645,210.00 $ 32,041,383.00 $ 29,273,496.00 $ 32,084,794.00 $ 30,015,690.14 $ 23,347,276.94 $ 18,853,460.00 $ 18,112,226.00 $ 16,167,196.67 $

-

$ 181,474,662.64

-

$ 173,670,524.64

-

$ 162,048,488.83

-

$ 153,882,421.56

-

$ 152,089,597.34

-

$ 143,908,233.09

-

$ 139,175,704.63

-

$ 133,561,656.27

-

$ 128,906,363.37

-

$ 124,781,368.61

19.96% 19.95% 19.77% 19.02% 21.10% 20.86% 16.78% 14.12% 14.05% 12.96%

- 38 -

HALL COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA

SCHEDULE "3"

For the Year Ended
June 30

School District's proportion of the Net Pension Liability (NPL)

School District's proportionate share
of the NPL

State of Georgia's proportionate share
of the NPL associated with the
School District

Total

School District's covered payroll

School District's proportionate share of the NPL as a percentage of its covered payroll

Plan fiduciary net position as a
percentage of the total pension
liability

2024 2023 2022 2021 2020 2019 2018 2017 2016 2015

0.00% $ 0.00% $ 0.00% $ 0.00% $ 0.00% $ 0.00% $ 0.00% $ 0.00% $ 0.00% $ 0.00% $

-

$ 2,589,783.00 $ 2,589,783.00 $ 9,573,427.72

-

$ 3,296,413.00 $ 3,296,413.00 $ 9,023,671.15

-

$

341,333.00 $ 341,333.00 $ 7,842,995.60

-

$ 2,509,764.00 $ 2,509,764.00 $ 8,226,784.42

-

$ 2,414,630.00 $ 2,414,630.00 $ 7,997,880.19

-

$ 2,364,550.00 $ 2,364,550.00 $ 7,799,727.86

-

$ 2,250,443.00 $ 2,250,443.00 $ 7,807,800.32

-

$ 2,952,169.00 $ 2,952,169.00 $ 7,584,539.95

-

$ 2,080,597.00 $ 2,080,597.00 $ 7,625,534.08

-

$ 1,881,067.00 $ 1,881,067.00 $ 7,799,257.19

N/A

85.67%

N/A

81.21%

N/A

98.00%

N/A

84.45%

N/A

85.02%

N/A

85.26%

N/A

85.69%

N/A

81.00%

N/A

87.00%

N/A

88.29%

- 39 -

HALL COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY
SCHOOL OPEB FUND

SCHEDULE "4"

For the Year Ended
June 30

School District's proportion of the Net OPEB Liability (NOL)

School District's proportionate share
of the NOL

State of Georgia's proportionate
share of the NOL associated with the School District

Total

School District's covered-employee
payroll

School District's proportionate share of the NOL as a percentage of its coveredemployee payroll

Plan fiduciary net position
as a percentage of the total OPEB
liability

2024 2023 2022 2021 2020 2019 2018

1.555598% $ 170,391,062.00 $ 1.541530% $ 152,660,521.00 $ 1.537208% $ 166,492,343.00 $ 1.552090% $ 227,965,874.00 $ 1.555799% $ 190,929,917.00 $ 1.542768% $ 196,081,078.00 $ 1.546011% $ 217,213,923.00 $

-

$ 170,391,062.00 $ 163,965,091.09

-

$ 152,660,521.00 $ 159,860,942.62

-

$ 166,492,343.00 $ 145,354,705.55

-

$ 227,965,874.00 $ 141,563,168.87

-

$ 190,929,917.00 $ 133,584,702.25

-

$ 196,081,078.00 $ 128,990,213.74

-

$ 217,213,923.00 $ 121,915,571.57

103.92% 95.50%
114.54% 161.03% 142.93% 152.01% 178.17%

6.05% 6.17% 6.14% 3.99% 4.63% 2.93% 1.61%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 40 -

HALL COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND

SCHEDULE "5"

For the Year Ended June 30

Contractually required contribution

Contributions in relation to the contractually required
contribution

Contribution deficiency (excess)

School District's covered-employee
payroll

Contribution as a percentage of
covered-employee payroll

2024

$

2023

$

2022

$

2021

$

2020

$

2019

$

2018

$

2017

$

6,323,392.00 $ 5,980,401.00 $ 5,573,788.00 $ 5,718,155.00 $ 5,248,807.00 $ 8,379,054.00 $ 7,996,021.00 $ 8,061,024.00 $

6,323,392.00 $ 5,980,401.00 $ 5,573,788.00 $ 5,718,155.00 $ 5,248,807.00 $ 8,379,054.00 $ 7,996,021.00 $ 8,061,024.00 $

-

$ 161,454,844.73

-

$ 163,965,091.09

-

$ 159,860,942.62

-

$ 145,354,705.55

-

$ 141,563,168.87

-

$ 133,584,702.25

-

$ 128,990,213.74

-

$ 121,915,571.57

3.92% 3.65% 3.49% 3.93% 3.71% 6.27% 6.20% 6.61%

This schedule is intended to show information for 10 years. Additional years will be displayed as they become available.

- 41 -

HALL COUNTY BOARD OF EDUCATION NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2024

SCHEDULE "6"

Teachers Retirement System Change of benefit terms: There have been no changes in benefit terms.
Changes of assumptions: On November 18, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to RP-2000 White Collar Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB (set forward one year for males).
On May 15, 2019, the Board adopted recommended changes from the smoothed valuation interest rate methodology that has been in effect since June 30, 2009, to a constant interest rate method. In conjunction with the methodology, the long-term assumed rate of return in assets (discount rate) has been changed from 7.50% to 7.25%, and the assumed annual rate of inflation has been reduced from 2.75% to 2.50%.
In 2019 and later, the expectation of retired life mortality was changed to the Pub-2010 Teacher Headcount Weighted Below Median Healthy Retiree mortality table from the RP-2000 Mortality Tables. In 2019, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience.
On May 11, 2022, the Board adopted recommended changes to the long-term assumed rate of return and payroll growth assumption utilized by the System. The long-term assumed rate of return was changed from 7.25% to 6.90%, and the payroll growth assumption was changed from 3.00% to 2.50%.
Public School Employees Retirement System Changes of benefit terms: There have been no changes in benefit terms.
Changes of assumptions: On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement and withdrawal. The expectation of retired life mortality was changed to the RP-2000 Blue Collar Mortality Table projected to 2025 with projection scale BB (set forward 3 years for males and 2 years for females).
A new funding policy was initially adopted by the Board on March 15, 2018, and most recently amended on December 17, 2020. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for the June 30, 2017 actuarial valuation and further reduced from 7.40% to 7.30% for the June 30, 2018 actuarial valuation.
On December 17, 2020, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System based on the experience study prepared for the five-year period ending June 30, 2019. Primary among the changes were the updates to rates or mortality, retirement, disability, and withdrawal. This also included a change to the long-term assumed investment rate of return to 7.00%. These assumption changes are reflected in the calculation of the June 30, 2021 Total Pension Liability.
School OPEB Fund Changes of benefit terms: There have been no changes in benefit terms.
Changes in assumptions: June 30, 2022 valuation: The tobacco use assumption and aging factors were revised.
June 30, 2020 valuation: Decremental assumptions were changed to reflect the Employees' Retirement System's experience study. Approximately 0.10% of employees are members of the Employees' Retirement System.
June 30, 2019 valuation: Decremental assumptions were changed to reflect the Teachers Retirement System's experience study.
June 30, 2018 valuation: The inflation assumption was lowered from 2.75% to 2.50%.
June 30, 2017 valuation: The participation assumption, tobacco use assumption and morbidity factors were revised.
June 30, 2015 valuation: Decremental and underlying inflation assumptions were changed to reflect the Retirement Systems' experience studies.
June 30, 2012 valuation: A data audit was performed and data collection procedures and assumptions were changed.
The discount rate was updated from 3.07% as of June 30, 2016 to 3.58% as of June 30, 2017, to 3.87% as of June 30, 2018, back to 3.58% as of June 30, 2019, to 2.22% as of June 30, 2020, to 2.20% as of June 30, 2021, to 3.57% as of June 30, 2022, and to 3.68% as of June 30, 2023.

- 42 -

HALL COUNTY BOARD OF EDUCATION GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2024

SCHEDULE "7"

REVENUES Property Taxes Sales Taxes State Funds Federal Funds Charges for Services Investment Earnings Miscellaneous Total Revenues
EXPENDITURES Current Instruction Support Services Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operation of Plant Student Transportation Services Central Support Services Other Support Services Enterprise Operation Community Services Food Services Operation Capital Outlay Total Expenditures
Excess of Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES) Other Sources Other Uses Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending

NONAPPROPRIATED BUDGETS

ORIGINAL

FINAL

ACTUAL AMOUNTS

VARIANCE OVER/UNDER

$

148,599,620.00 $

148,599,620.00 $

151,518,607.69 $

4,000,000.00

4,000,000.00

2,882,269.02

178,585,294.00

186,674,639.78

190,700,570.75

62,231,873.60

57,152,540.16

60,769,098.28

2,973,588.40

3,718,219.15

4,945,572.83

3,000,000.00

3,000,000.00

5,127,254.32

1,200,000.00

1,200,000.00

6,540,073.17

400,590,376.00

404,345,019.09

422,483,446.06

2,918,987.69 (1,117,730.98) 4,025,930.97 3,616,558.12 1,227,353.68 2,127,254.32 5,340,073.17 18,138,426.97

242,784,130.00
23,507,996.00 15,955,213.00
5,987,692.00 965,845.00
21,475,394.00 3,097,303.00
25,980,436.00 21,587,826.00
8,110,146.00 696,004.00 58,203.00 -
19,197,844.00 12,000,000.00 401,404,032.00
(813,656.00)

249,123,337.28
21,352,478.00 15,550,425.50
6,056,172.00 821,532.00
21,682,374.00 3,124,793.00
27,318,171.00 22,628,125.00
8,400,976.00 801,254.00 59,203.00 -
18,072,933.59 12,395,911.00 407,387,685.37 (3,042,666.28)

240,620,652.47
21,069,850.97 14,389,175.31
5,962,947.02 672,733.29
21,839,625.32 3,023,559.66
27,108,200.86 21,022,465.74
8,807,362.48 1,397,821.23 1,813,676.94
16,020.50 21,687,810.08 14,120,839.33 403,552,741.20 18,930,704.86

8,502,684.81
282,627.03 1,161,250.19
93,224.98 148,798.71 (157,251.32) 101,233.34 209,970.14 1,605,659.26 (406,386.48) (596,567.23) (1,754,473.94) (16,020.50) (3,614,876.49) (1,724,928.33) 3,834,944.17 21,973,371.14

20,000.00 (2,020,000.00) (2,000,000.00)

20,000.00 (2,020,000.00) (2,000,000.00)

352.23 (732,324.00) (731,971.77)

(19,647.77) 1,287,676.00 1,268,028.23

(2,813,656.00)

(5,042,666.28)

18,198,733.09

23,241,399.37

74,843,111.41

95,504,416.71

101,551,086.31

6,046,669.60

$

72,029,455.41 $

90,461,750.43 $

119,749,819.40 $

29,288,068.97

Notes to the Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual
The accompanying schedule of revenues, expenditures and changes in fund balances budget and actual is presented on the modified accrual basis of accounting which is the basis of accounting used in the presentation of the fund financial statements.

See notes to the basic financial statements.

- 43 -

HALL COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2024

SCHEDULE "8"

FUNDING AGENCY PROGRAM/GRANT Agriculture, U.S. Department of
Child Nutrition Cluster Pass-Through From Georgia Department of Education Food Services School Breakfast Program National School Lunch Program COVID-19 - National School Lunch Program Fresh Fruit and Vegetable Program Total Child Nutrition Cluster
Other Programs Pass-Through From Georgia Department of Education Food Services Local Food for Schools Cooperative Agreement Program State Administrative Expenses for Child Nutrition Child Nutrition Discretionary Grants Limited Availability Total Other Programs Total U.S. Department of Agriculture
Education, U.S. Department of Education Stabilization Fund Pass-Through From Georgia Department of Education COVID-19 - Elementary and Secondary School Emergency Relief Fund COVID-19 - American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 - American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 - American Rescue Plan Elementary and Secondary School Emergency Relief Fund - Homeless Children and Youth Total Education Stabilization Fund
Special Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Grants to States COVID-19 - American Rescue Plan - Grants to States Preschool Grants Preschool Grants Total Special Education Cluster
Other Programs Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to States Education for Homeless Children and Youth Education for Homeless Children and Youth English Language Acquisition State Grants English Language Acquisition State Grants Migrant Education State Grant Program Migrant Education State Grant Program Student Support and Academic Enrichment Program Student Support and Academic Enrichment Program Student Support and Academic Enrichment Program Supporting Effective Instruction State Grants Supporting Effective Instruction State Grants Title I Grants to Local Educational Agencies

ASSISTANCE LISTING NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

EXPENDITURES IN PERIOD

10.553 10.555 10.555 10.582

245GA324N1199 $ 245GA324N1199 225GA324N1099 245GA324L1603

3,910,222.03 15,443,846.90
683,874.06 445,342.36 20,483,285.35

10.185 10.560 10.579

AM23CPLFS000C018 245GA904N2533 202321I500345

21,716.00 21,364.20 25,475.00 68,555.20 20,551,840.55

84.425D 84.425U 84.425U 84.425W

S425D210012 S425U200012 S425U210012 S425W210011

367,087.70 7,500.00
21,723,412.90 79,814.14
22,177,814.74

84.027A 84.027A 84.027X 84.173A 84.173A

H027A220073 H027A220073 H027X210073 H173A220081 H173A220081

84.048A 84.196A 84.196A 84.365A 84.365A 84.011A 84.011A 84.424A 84.424A 84.424F 84.367A 84.367A 84.010A

V048A230010 S196A220011 S196A230011 S365A220010 S365A230010 S011A220011 S011A230011 S424A220011 S424A230011 S424F220011 S367A220001 S367A230001 S010A220010

642,412.89 5,137,554.61
39,619.96 23,519.68 136,935.62 5,980,042.76
255,934.00 17,772.38 65,795.50
686,524.72 124,885.33 278,035.43
39,689.38 103,871.83 465,017.49
32,492.00 1,188,394.24
153,201.88 2,490,015.00
- 44 -

HALL COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2024

SCHEDULE "8"

FUNDING AGENCY PROGRAM/GRANT
Title I Grants to Local Educational Agencies Total Other Programs Total U.S. Department of Education
Health and Human Services, U.S. Department of Pass-Through From the Division of Family and Children Services Sources of Strength Pass-Through From Bright From the Start Georgia Department of Early Care and Learning COVID-19 - Child Care and Development Block Grant
Other Programs Pass-Through From Georgia Department of Education Substance Abuse and Mental Health Services Projects of Regional and National Significance Total U.S. Department of Health and Human Services
Treasury, U.S. Department of the Pass-Through From Georgia Department of Education COVID-19 - Coronavirus State and Local Fiscal Recovery Funds
Defense, U.S. Department of Direct Department of the Navy R.O.T.C. Program
Total Expenditures of Federal Awards

ASSISTANCE LISTING NUMBER
84.010A

PASSTHROUGH
ENTITY ID
NUMBER
S010A230010

EXPENDITURES IN PERIOD
6,071,013.73 11,972,572.91 40,130,430.41

93.558 93.575

2401GATANF 2310GACCCS

67,605.32 23,669.37

93.243

1H79SM061877

21.027

SLT - 1189

413,290.59 504,565.28
3,994.02

12. UNKNOWN

111,759.22

$

61,302,589.48

Notes to the Schedule of Expenditures of Federal Awards
Note 1. Basis of Presentation The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of the Hall County Board of Education (the "Board") under programs of the federal government for the year ended June 30, 2024. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Board, it is not intended to and does not present the financial position or changes in net position of the Board.
Note 2. Summary of Significant Accounting Policies Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Note 3. Indirect Cost Rate The Board has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.

See notes to the basic financial statements.

- 45 -

HALL COUNTY BOARD OF EDUCATION SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2024

SCHEDULE "9"

AGENCY/FUNDING GRANTS Bright From the Start: Georgia Department of Early Care and Learning Pre-Kindergarten Program Education, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) Media Center Program 20 Days Additional Instruction Staff and Professional Development Principal Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Local Fair Share Categorical Grants Pupil Transportation Regular Bus Replacement Nursing Services Education Equalization Funding Grant Other State Programs Agriculture Construction Related Equipment - State Bonds Career, Technical and Agricultural Education (CTEA) Career, Technical and Agricultural Education (CTEA) Connect Grant Bond Funds Dyslexia Services Grant - State Funds Food Services Hygiene Products Math and Science Supplements One Time QBE Adjustment Preschool Disability Services Pupil Transportation - State Bonds School Security Grant Teachers Retirement Vocational Construction Related Equipment - State Bonds Georgia State Financing and Investment Commission Reimbursement on Construction Projects Office of the State Treasurer Public School Employees Retirement

GOVERNMENTAL FUND TYPES

GENERAL

CAPITAL PROJECTS

FUND

FUND

TOTAL

$ 1,093,539.50 $

- $ 1,093,539.50

9,684,466.00 985,314.00
21,171,463.00 3,212,720.00
10,298,731.00 1,491,715.00
20,012,564.00 19,359,485.00
7,577,778.00 29,489,514.00 12,333,846.00
1,020,236.00 1,563,409.00 13,537,037.00 3,675,524.00 1,076,577.00
668,896.00 11,210.00
3,724,878.00 7,329,874.00 6,989,530.00 (532,954.00)
2,232,254.00 1,057,320.00
646,700.00 1,061,123.00
2,500,000.00 516,433.07 25,959.00 54,316.00 578,372.00 22,633.00 235,342.28
2,961,395.00 450,992.00 96,000.00
1,800,276.36 68,109.54
160,500.00
-
457,493.00

-

9,684,466.00

-

985,314.00

-

21,171,463.00

-

3,212,720.00

-

10,298,731.00

-

1,491,715.00

-

20,012,564.00

-

19,359,485.00

-

7,577,778.00

-

29,489,514.00

-

12,333,846.00

-

1,020,236.00

-

1,563,409.00

-

13,537,037.00

-

3,675,524.00

-

1,076,577.00

-

668,896.00

-

11,210.00

-

3,724,878.00

-

7,329,874.00

-

6,989,530.00

-

(532,954.00)

-
-
-
2,656,485.30
-

2,232,254.00 1,057,320.00
646,700.00 1,061,123.00
2,500,000.00 516,433.07 25,959.00 54,316.00 578,372.00 22,633.00 235,342.28
2,961,395.00 450,992.00 96,000.00
1,800,276.36 68,109.54
160,500.00
2,656,485.30
457,493.00

$ 190,700,570.75 $

2,656,485.30 $ 193,357,056.05

See notes to the basic financial statements.

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HALL COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2024

SCHEDULE "10"

PROJECT SPLOST V
Acquiring, constructing and equipping new schools, fine arts facilities, physical education facilities, sports facilities, other student activity facilities, acquiring and conducting site preparation of real estate for current and future school district purposes, constructing and equipping additional classrooms, instructional and support space, and other school district facilities at existing school system facilities, including but not limited to roofing, HVAC, security and emergency alarm systems, flooring, plumbing and electrical capacity, and acquiring furnishings, equipment and fixtures for new and existing facilities system-wide, including technology equipment, textbooks, library books and school buses.
Payment of a portion of the purchase price payments due on that certain Contract between the School District and the Gainesville and Hall County Development Authority, dated as of November 1, 2007, with a maximum payment of $875,975.00.
Payment of a portion of the purchase price payments due on that certain Installment Sales Agreement between the Hall County School District and the Gainesville and Hall County Development Authority, dated as of September 1, 2010, with a maximum payment amount of $1,045,000.00.
Payment of any general obligation debt of the Hall County School District issued in conjunction with the imposition of the Sales Tax.
Subtotal SPLOST V Projects
SPLOST VI Acquiring, constructing and equipping new schools, fine arts facilities, physical education facilities, sports facilities, other student activity facilities and other school system facilities, acquiring and conducting site preparation of real estate for current and future school district purposes, constructing and equipping additional classrooms and instructional and support space, remodeling, renovating and equipping classrooms, instructional and support space, and other school district facilities at existing school system facilities, including but not limited to roofing, HVAC, security and emergency alarm systems, flooring, plumbing and electrical capacity, acquiring furnishings, equipment and fixtures for new and existing facilities system-wide, including technology equipment and infrastructure, band instruments, textbooks, library books and school buses.
Payment of a portion of the purchase price payments due on that certain Contract between the School District and the Gainesville and Hall County Development Authority, dated as of November 1, 2007, with a maximum payment of $145,996.00.
Payment of a portion of the purchase price payments due on that certain Installment Sale Agreement between the Hall County School District and the Gainesville and Hall County Development Authority, dated as of September 1, 2010, with a maximum payment amount of $870,828.00.
Payment of a portion of the debt service on the general obligation bonds of the Hall County School District to be issued in 2020, 2021, or 2022, with a maximum payment amount of $50,000,000.00.
Subtotal SPLOST VI Projects
Total

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

$ 147,030,000.00 $ 167,373,064.50

875,975.40

875,975.40

1,045,000.00
1,290,036.25 150,241,011.65

1,044,992.76
4,331,006.25 173,625,038.91

198,983,176.00

198,983,176.00

145,996.00

-

870,828.00

870,828.00

50,000,000.00 250,000,000.00

50,000,000.00 249,854,004.00

$ 400,241,011.65 $ 423,479,042.91

ESTIMATED COMPLETION
DATE
12/31/2025 Complete 2/1/2027 Complete
12/31/2027 Complete 2/1/2027 12/31/2027

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HALL COUNTY BOARD OF EDUCATION SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2024

SCHEDULE "10"

AMOUNT

AMOUNT

EXPENDED

EXPENDED

TOTAL

EXCESS

IN CURRENT

IN PRIOR

COMPLETION PROCEEDS NOT

PROJECT

YEAR (3)

YEARS (3)

COST

EXPENDED

SPLOST V

Acquiring, constructing and equipping new schools, fine arts facilities, physical

education facilities, sports facilities, other student activity facilities, acquiring and

conducting site preparation of real estate for current and future school district

purposes, constructing and equipping additional classrooms, instructional and

support space, and other school district facilities at existing school system facilities,

including but not limited to roofing, HVAC, security and emergency alarm systems,

flooring, plumbing and electrical capacity, and acquiring furnishings, equipment

and fixtures for new and existing facilities system-wide, including technology

equipment, textbooks, library books and school buses.

$ 36,150,388.65 $ 131,222,675.85 $

- $

-

Payment of a portion of the purchase price payments due on that certain Contract

between the School District and the Gainesville and Hall County Development

Authority, dated as of November 1, 2007, with a maximum payment of $875,975.00.

-

875,975.40

875,975.40

-

Payment of a portion of the purchase price payments due on that certain Installment Sales Agreement between the Hall County School District and the Gainesville and Hall County Development Authority, dated as of September 1, 2010, with a maximum payment amount of $1,045,000.00.

-

521,453.25

-

-

Payment of any general obligation debt of the Hall County School District

issued in conjunction with the imposition of the Sales Tax.

2,373.75

4,328,632.50

4,331,006.25

-

Subtotal SPLOST V Projects

36,152,762.40 136,948,737.00

5,206,981.65

-

SPLOST VI

Acquiring, constructing and equipping new schools, fine arts facilities, physical

education facilities, sports facilities, other student activity facilities and other school

system facilities, acquiring and conducting site preparation of real estate for current

and future school district purposes, constructing and equipping additional

classrooms and instructional and support space, remodeling, renovating and

equipping classrooms, instructional and support space, and other school district

facilities at existing school system facilities, including but not limited to roofing,

HVAC, security and emergency alarm systems, flooring, plumbing and electrical

capacity, acquiring furnishings, equipment and fixtures for new and existing

facilities system-wide, including technology equipment and infrastructure, band

instruments, textbooks, library books and school buses.

38,619,039.20

-

-

-

Payment of a portion of the purchase price payments due on that certain Contract

between the School District and the Gainesville and Hall County Development

Authority, dated as of November 1, 2007, with a maximum payment of $145,996.00.

-

-

-

-

Payment of a portion of the purchase price payments due on that certain Installment

Sale Agreement between the Hall County School District and the Gainesville and

Hall County Development Authority, dated as of September 1, 2010, with a

maximum payment amount of $870,828.00.

-

-

-

-

Payment of a portion of the debt service on the general obligation bonds of the

Hall County School District to be issued in 2020, 2021, or 2022, with a maximum

payment amount of $50,000,000.00.

2,469,706.25

-

-

-

Subtotal SPLOST VI Projects

41,088,745.45

-

-

-

Total

$ 77,241,507.85 $ 136,948,737.00 $ 5,206,981.65 $

-

(1) The School District's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax. (2) The School District's current estimate of total cost for the projects. Includes all cost from project inception to completion. (3) The voters of Hall County approved the imposition of a 1% sales tax to fund the above projects and retire associated debt.
Amounts expended for these projects may include sales tax proceeds, state, local property taxes and/or other funds over the life of the projects.

See notes to the basic financial statements.

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Section II Compliance and Internal Control Reports

Greg S. Griffin State Auditor
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Mr. William Schofield, Superintendent and Members of the Hall County Board of Education
We have audited the financial statements of the governmental activities and each major fund of the Hall County Board of Education (School District) as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the School District's basic financial statements, and have issued our report thereon dated March 27, 2025. We conducted our audit in accordance with the auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States.
Report on Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the School District's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the basic financial statements, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control. Accordingly, we do not express an opinion on the effectiveness of the School District's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the School District's financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. Given these limitations, during our audit we did not identify any
270 Washington Street, SW, Suite 4-101 Atlanta, Georgia 30334 | Phone (404) 656-2180

deficiencies in internal control that we consider to be material weaknesses. We did identify a certain deficiency in internal control, described in the accompanying Schedule of Findings and Questioned Costs in finding FS 2024-01 that we consider to be a significant deficiency.
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the School District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
School District's Response to Findings
Government Auditing Standards requires the auditor to perform limited procedures on the School District's response to the finding identified in our audit and described in the accompanying Schedule of Findings and Questioned Costs. The School District's response was not subjected to the other auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on the response.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the School District's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the School District's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Respectfully submitted,
Greg S. Griffin State Auditor
March 27, 2025

Greg S. Griffin State Auditor
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE
The Honorable Brian P. Kemp, Governor of Georgia Members of the General Assembly of the State of Georgia Members of the State Board of Education
and Mr. William Schofield, Superintendent and Members of the Hall County Board of Education
Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program
We have audited the Hall County Board of Education's (School District) compliance with the types of compliance requirements identified as subject to audit in the OMB Compliance Supplement that could have a direct and material effect on each of the School District's major federal programs for the year ended June 30, 2024. The School District's major federal programs are identified in the Summary of Auditor's Results section of the accompanying Schedule of Findings and Questioned Costs.
In our opinion, the School District complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2024.
Basis for Opinion on Each Major Federal Program
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America (GAAS); the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Our responsibilities under those standards and the Uniform Guidance are further described in the Auditor's Responsibilities for the Audit of Compliance section of our report.
We are required to be independent of the School District and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on compliance for each major federal program. Our audit does not provide a legal determination of the School District's compliance with the compliance requirements referred to above.
270 Washington Street, SW, Suite 4-101 Atlanta, Georgia 30334 | Phone (404) 656-2180

Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules and provisions of contracts or grant agreements applicable to the School District's federal programs.
Auditor's Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on the School District's compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS, Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material, if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the School District's compliance with the requirements of each major federal program as a whole.
In performing an audit in accordance with GAAS, Government Auditing Standards, and the Uniform Guidance, we:
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the School District's compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.
Obtain an understanding of the School District's internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of the School District's internal control over compliance. Accordingly, no such opinion is expressed.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit.
Report on Internal Control over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance

requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the Auditor's Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that were not identified.
Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.
Respectfully submitted,
Greg S. Griffin State Auditor
March 27, 2025

Section III Auditee's Response to Prior Year Findings and Questioned Costs

HALL COUNTY BOARD OF EDUCATION AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS YEAR ENDED JUNE 30, 2024

PRIOR YEAR FINANCIAL STATEMENT FINDINGS

FS 2023-001 Strengthen Controls over Bus Driver Compensation

Finding Status:

Partially Resolved

At the conclusion of the fiscal year 2023 audit, the district began implementing a process of review
and approval for all timesheets related to extra duties by a supervisor with appropriate knowledge of a bus driver's or bus monitor's duties. As of the end of the fiscal year 2023 audit, timesheets are signed by an appropriate supervisor and the transportation payroll, overall, is signed by the Director of Transportation. The district is also currently in the process of
implementing a time clock software for use by bus drivers and monitors to track their time and attendance. Certain classifications of extra pay were consolidated and eliminated by the district, but, due to cost limitations, there are still different rates for certain types of extra pay. Due to the
cost limitations, the district is using the approval process over extra pay to ensure that amounts paid to drivers and monitors are appropriate based on the duties performed.

PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS

No matters were reported.

Section IV Findings and Questioned Costs

HALL COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2024

I SUMMARY OF AUDITOR'S RESULTS

Financial Statements
Type of auditor's report issued: Governmental Activities and Each Major Fund
Internal control over financial reporting: Material weakness(es) identified? Significant deficiency(ies) identified?
Noncompliance material to financial statements noted:
Federal Awards
Internal control over major programs: Material weakness(es) identified? Significant deficiency(ies) identified?
Type of auditor's report issued on compliance for major programs:
All major programs
Any audit findings disclosed that are required to be reported in accordance with 2 CFR 200.516(a)?
Identification of major programs:
Assistance Listing Numbers Assistance Listing Program or Cluster Title

Unmodified No Yes No
No None Reported
Unmodified No

10.553, 10.555, 10.582

Child Nutrition Cluster

Dollar threshold used to distinguish between Type A and Type B programs:

Auditee qualified as low-risk auditee?

$1,839,077.68 Yes

- 1 -

HALL COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2024

II FINANCIAL STATEMENT FINDINGS

FS 2024-001 Strengthen Controls over Bus Driver Compensation

Internal Control Impact: Repeat of Prior Year Finding:

Significant Deficiency FS 2023-001

Description: A review of bus drivers' salaries revealed that the School District did not have adequate internal controls to ensure that payments made to the bus drivers were appropriate.
Criteria: Management is responsible for designing and maintaining internal controls over bus driver compensation that provide reasonable assurance that all transactions are accurate and processed according to established policies and procedures as approved by the School District.
Condition: Our review of eight bus drivers' salaries over $75,000 revealed the following deficiencies in all eight of the bus drivers' salaries:
No documentation was provided to support years of service to verify pay to salary schedules. The School District did not have adequate procedures in place to ensure proper separation of
duties over the bus driver compensation process. Adequate procedures were not in place to ensure bus driver compensation expenditures were
properly documented, calculated and approved before disbursement. There was no documentation of approval of routes, additional routes and overtime pay for each
of the eight drivers. Due to inadequate documentation, the auditors were not able to calculate a total amount of
possible overpayments made to the bus drivers.
Cause: In discussing these deficiencies with the School District, they stated that these issues result from a lack of managerial oversight with the Payroll Departments and Transportation. In addition, there was a failure to maintain and produce documentation to support compensation paid to the bus drivers.
Effect: The lack of adequate controls over the bus driver compensation process may result in misstatements which may not be detected and corrected by management. The School District may not be effectively managing public funds, as evidence by the possible overpayments to bus drivers.
Recommendation: The School District should review the controls and procedures currently in place related to bus driver compensation, identify weaknesses, and design and implement procedures necessary to strengthen controls over these processes.
Views of Responsible Officials: We concur with this finding.

- 2 -

HALL COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2024 Ill FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.
- 3 -

Section V Management's Corrective Action