City of Vidalia Board of Education, Toombs County, Georgia, annual financial report for the fiscal year ended 2019 June 30 (including independent auditor's reports).

CITY OF VIDALIA BOARD OF EDUCATION
TOOMBS COUNTY, GEORGIA
ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2019
(Including Independent Auditor's Reports)

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

INDEPENDENT AUDITOR'S REPORT

REQUIRED SUPPLEMENTARY INFORMATION

MANAGEMENT'S DISCUSSION AND ANALYSIS

EXHIBITS

BASIC FINANCIAL STATEMENTS

GOVERNMENT-WIDE FINANCIAL STATEMENTS

A

STATEMENT OF NET POSITION

B

STATEMENT OF ACTIVITIES

FUND FINANCIAL STATEMENTS

C

BALANCE SHEET

GOVERNMENTAL FUNDS

D

RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET

TO THE STATEMENT OF NET POSITION

E

STATEMENT OF REVENUES, EXPENDITURES AND CHANGES

IN FUND BALANCES

GOVERNMENTAL FUNDS

F

RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT

OF REVENUES, EXPENDITURES AND CHANGES IN FUND

BALANCES TO THE STATEMENT OF ACTIVITIES

G

STATEMENT OF FIDUCIARY NET POSITION

FIDUCIARY FUNDS

H NOTES TO THE BASIC FINANCIAL STATEMENTS

SCHEDULES

REQUIRED SUPPLEMENTARY INFORMATION

1 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA
2 SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM OF GEORGIA
3 SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY SCHOOL OPEB FUND
4 SCHEDULE OF CONTRIBUTIONS TEACHERS RETIREMENT SYSTEM OF GEORGIA 5 SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND 6 NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION 7 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - BUDGET AND ACTUAL GENERAL FUND

Page
i
1 2
4 5 6 7 8 10
31 32 33 34 35 36 37

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY - TABLE OF CONTENTS -
SECTION I FINANCIAL SCHEDULES SUPPLEMENTARY INFORMATION 8 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 9 SCHEDULE OF STATE REVENUE 10 SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS

Page
38 39 41

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 YEAR FINDINGS AND QUESTIONED COSTS
SECTION IV FINDINGS AND QUESTIONED COSTS SCHEDULE OF FINDINGS AND QUESTIONED COSTS

SECTION I FINANCIAL

Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400
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 Superintendent and Members of the City of Vidalia Board of Education
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Vidalia Board of Education (School District), as of and for the year ended June 30, 2019, 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.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the of the governmental activities, each major fund, and the aggregate remaining fund information of the School District as of June 30, 2019, 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.
Other Matters
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, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the 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 accompanying 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 auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole.

Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated March 25, 2020 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 in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24.
Respectfully submitted,

March 25, 2020

Greg S. Griffin State Auditor

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019
INTRODUCTION
The discussion and analysis of the City of Vidalia Board of Education's (School District) financial performance provides an overview of the School District's financial activities for the fiscal year ended June 30, 2019. The intent of this discussion and analysis is to look at the School District's financial performance as a whole; readers should also review the notes to the basic financial statements and financial statements to enhance their understanding of the School District's financial performance.
FINANCIAL HIGHLIGHTS
Key financial highlights for fiscal year 2019 are as follows:
The total net position increased by $1.3 million which represents a 11.8% increase from the fiscal year 2018. This increase was due in part to a decrease in long-term debt.
The School District had $27.8 million in expenses relating to governmental activities; only $19.3 million of these expenses were offset by program specific charges for services and grants and contributions. General revenues (primarily property and sales taxes) of $9.8 million were adequate to provide for these programs.
As stated above, general revenues account for $9.8 million or 33.6% of all revenues totaling $29.1 million. Program specific revenues in the form of charges for services and operating and capital grants and contributions accounted for the remainder.
The Toombs County voters passed a one percent sales tax for educational purposes (ESPLOST) for another five years (2020 2025) on March 19, 2019.
Long-term liabilities decreased by $793 thousand for 2019. This decrease for 2019 was primarily due to principal payments on outstanding debt.
OVERVIEW OF THE FINANCIAL STATEMENTS
This report consists of several parts including management's discussion and analysis, the basic 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 the fund financial statements.
The government-wide financial statements include the Statement of Net Position and the 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 the 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. The fiduciary funds statement provides information about the financial relationships in which the School District acts solely as an agent for the benefit of others. The fund financial statements reflect the School District's most significant funds. In the case of the City of Vidalia Board of Education, the general fund and capital projects fund are the most significant funds.
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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019
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.
GOVERNMENT-WIDE STATEMENTS
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 about whether the School District is in a better financial position 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 of the School District's assets, deferred outflows, liabilities, and deferred inflows. They use 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 and other factors.
The Statement of Net Position and the Statement of Activities reflect the School District's governmental activities.
FUND FINANCIAL STATEMENTS
The School District uses many funds to account for a multitude of financial transactions during the fiscal year. However, the fund financial statements presented in this report provide detail information about only the School District's significant or major funds.
Governmental Funds - Most of 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 basis of accounting which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the School District's general government operations and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance educational programs. The differences between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds are reconciled within the financial statements.
Fiduciary Funds - The School District is the trustee, or fiduciary, for assets that belong to others, such as school clubs and organizations within the principals' accounts. The School District is responsible for ensuring that the assets reported in these funds are used only for their intended purposes and by those to whom the assets belong. The School District excludes these activities from the governmentwide financial statements because it cannot use these assets to finance its operations.
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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT AS A WHOLE

Recall that the Statement of Net Position provides the perspective of the School District as a whole. Table 1 provides a summary of the School District's net position for the fiscal years 2019 and 2018. Table 2 shows the changes in net position for the fiscal years ending June 30, 2019 and June 30, 2018.

Table 1

Net Position

Governmental Activities

Fiscal

Fiscal

Net

Year 2019

Year 2018

Change

ASSETS

Cash and Cash Equivalents

$

7,133,523 $ 9,080,722 $ (1,947,199)

Investments

89,206

88,752

454

Accounts Receivable, Net

Taxes

3,048,951

3,066,373

(17,422)

State Government

2,133,970

1,907,194

226,776

Federal Government

417,235

520,603

(103,368)

Local

7,053

44,363

(37,310)

Other

174,061

160,460

13,601

Inventories

50,539

47,661

2,878

Capital Assets, Non-Depreciable

808,422

30,377,364

(29,568,942)

Capital Assets, Depreciable (Net of Accumulated Depreciation)

57,649,483

27,884,368

29,765,115

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

71,512,443
4,365,012 1,277,365

73,177,860
3,544,346 1,338,892

(1,665,417)
820,666 (61,527)

Total Deferred Outflows of Resources LIABILITIES
Accounts Payable Salaries and Benefits Payable Interest Payable Retainages Payable Net Pension Liability Net OPEB Liability Long-Term Liabilities
Due Within One Year Due in More Than One Year

5,642,377
3,022 2,526,386
305,391 -
19,617,214 17,444,181
807,728 19,513,428

4,883,238
7,398 2,619,232
311,099 1,376,765 20,268,022 19,685,258
792,728 20,321,156

759,139
(4,376) (92,846)
(5,708) (1,376,765)
(650,808) (2,241,077)
15,000 (807,728)

Total Liabilities Deferred Inflows of Resources
Related to Defined Benefits Pension Plans Related to OPEB Plan

60,217,350
1,232,997 3,717,763

65,381,658
454,004 1,498,983

(5,164,308)
778,993 2,218,780

Total Deferred Inflows of Resources NET POSITION
Net Investment in Capital Assets Restricted for
Continuation of Federal Programs Debt Service Capital Projects Unrestricted (Deficit)

4,950,760
38,480,832
854,681 761,406 2,202,243 (30,312,452)

1,952,987
36,115,168
744,089 746,495 4,347,100 (31,226,399)

2,997,773
2,365,664
110,592 14,911
(2,144,857) 913,947

Total Net Position

$ 11,986,710 $ 10,726,453 $ 1,260,257

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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

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: Taxes Property Taxes For Maintenance and Operations Sales Taxes For Capital Projects Grants and Contributions not Restricted to Specific Programs Investment Earnings
Miscellaneous

Total General Revenues

Total Revenues

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 Services Other Support Services Operations of Non-Instructional Services Enterprise Operations Community Services Food Services Interest on Short-Term and Long-Term Debt

Total Expenses

Increase in Net Position

$

Fiscal Year 2019

GOVERNMENTAL ACTIVITIES Fiscal
Year 2018

Net Change

477,715 $ 17,644,212
1,197,081
19,319,008

416,690 $ 17,422,153
7,433,849
25,272,692

61,025 222,059 (6,236,768)
(5,953,684)

5,283,408
2,269,393 1,081,837
3,083 1,122,903
9,760,624
29,079,632

5,054,636
2,160,082 872,981 8,968 952,091
9,048,758
34,321,450

228,772
109,311 208,856
(5,885) 170,812
711,866
(5,241,818)

16,334,362
1,896,303 742,469 463,348 529,764
1,398,017 303,974
2,734,747 830,962 5,713 27,679
80,696 81,831 1,762,149 627,361
27,819,375
1,260,257 $

16,367,719
1,903,968 654,488 473,236 416,619
1,377,715 261,142
1,894,372 823,273 6,161 33,823
48,343 73,209 1,861,113 639,919
26,835,100
7,486,350 $

(33,357)
(7,665) 87,981 (9,888) 113,145 20,302 42,832 840,375
7,689 (448)
(6,144)
32,353 8,622
(98,964) (12,558)
984,275
(6,226,093)

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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019

GOVERNMENTAL ACTIVITIES
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. It identifies the cost of these services supported by tax revenue and unrestricted state entitlements.

Table 3 Governmental Activities
Total Cost of Services Fiscal Year 2019

Net Cost of Services Fiscal Year 2019

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 Short-Term and Long-Term Debt

$ 16,334,362 $
1,896,303 742,469 463,348 529,764
1,398,017 303,974
2,734,747 830,962 5,713 27,679
80,696 81,831 1,762,149 627,361

2,512,115
1,574,311 420,400 101,834 (92,426) 656,327 299,452
1,977,224 563,636 5,713 27,679
(77,708) 8,122
(103,673) 627,361

Total Expenses

$ 27,819,375 $

8,500,367

Although program revenues make up a majority of the funding, the School District is still dependent upon tax revenues for governmental activities. For 2019, 30.6% of expenses were supplemented by taxes and other general revenues.

FINANCIAL ANALYSIS OF THE SCHOOL DISTRICT'S FUNDS
The School District's governmental funds are accounted for using the modified accrual basis of accounting. The governmental funds had total revenues of $29.4 million and total expenditures of $29.5 million. The general fund revenues had an increase of $1.9 million due to an increase in state and federal funding and changes in local property tax distribution related to Title Ad Valorem Tax. The fund balance related to the capital projects fund decreased $768 thousand due to expenditures for additional technology, instructional materials and various construction projects to maintain and improve school facilities as well as completion of the new Vidalia High School.

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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019
GENERAL FUND BUDGETING HIGHLIGHTS
The School District's budget is prepared in accordance with Georgia law. The most significant budgeted fund is the general fund, which includes local, state and federal funds collected and disbursed for the purpose of operating the school system.
The School District's budget is based on its overall mission and incorporates site-based budgeting into the budget process to control total site budgets but provide flexibility for site management.
For the general fund, the final budgeted amount of $25.7 million was less than the actual revenues of $26.3 million by $537 thousand. Property tax revenues were budgeted based on the tax digest, but changes in the distribution of Title Ad Valorem Tax from the City of Vidalia resulted in additional unbudgeted revenue.
The budgeted expenditures of $25.7 million was more than the actual amount of $25.6 million by $122 thousand. This difference is well within the expected parameters for budget variances.
General fund revenues were more than expenditures by $700 thousand.
CAPITAL ASSETS
At fiscal year ended June 30, 2019, the School District had $58.5 million invested in capital assets in the government-wide financial statements (Statement of Net Position). Table 4 reflects a summary of these balances for fiscal year 2019 as compared to balances for fiscal year 2018. Construction began on the new Vidalia High School in fiscal year 2017 and was completed this fiscal year. This has resulted in a $29.4 million dollar increase in buildings and improvements for fiscal year 2019.
Table 4 Capital Assets (Net of Depreciation)

Fiscal Year 2019

Governmental Activities Fiscal
Year 2018

Net Change

Land Construction in Progress Land Improvements Buildings and Improvements Equipment

$

808,422 $

-

1,945,484

54,833,669

870,330

$ 58,457,905 $

808,422 $ 29,568,942
1,974,090 25,478,390
431,888
58,261,732 $

(29,568,942)
(28,606) 29,355,279
438,442
196,173

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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE FISCAL YEAR ENDED JUNE 30, 2019
LONG-TERM LIABILITIES
At June 30, 2019, the School District had $20.3 million in total long-term liabilities outstanding with $807.7 thousand due within one year. Table 5 summarizes bond debt outstanding at June 30, 2019 and 2018.
Table 5 Debt at June 30

General Obligation Bonds Unamortized Bond Premium

Governmental Activities

Fiscal Year 2019

Fiscal Year 2018

$ 18,400,000 1,921,156

$ 19,085,000 2,028,885

Total

$ 20,321,156 $ 21,113,885

CURRENT ISSUES
The following statements should help to explain the current financial position of the City of Vidalia School District and the effects the current economic conditions have had on it. The State of Georgia economic conditions are improving and state funding for education no longer reflects austerity cuts (or amended formula adjustments) which began in fiscal year 2003. Our School District has seen the weight of taxpayer burden shift from the state taxpayer level to the local taxpayer level, and the removal of the austerity cuts from the funding formula has greatly impacted the financial position in a positive way. Changes in the way Title Ad Valorem Taxes are distributed to the school system by the City of Vidalia coupled with back pay for "True Up" monies from prior years also served to improve the current financial position. The School District will continue to look for ways to align resources and costs with the objective of providing a quality education to our students.
The New Vidalia High School project was completed early in the fiscal year and was within budget. Other major expenses for the year included a new roof for the old Vidalia High School main building at a cost of $364 thousand, which was funded from Local Option Sales Tax. A portion of these funds are intended to be replaced by proceeds from the sale of the old central office facility, when this occurs. Central office administration moved to the old high school facility in January of 2019. These changes have been made in an effort to make the best use of available facilities and reduce maintenance and upkeep costs on older buildings.
CONTACTING THE SCHOOL DISTRICT'S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, 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, please contact Mrs. Norma D. Croft, Finance Director for the City of Vidalia Board of Education, 1001 North Street, West, Vidalia, GA 30474. You may also email your questions to Mrs. Croft at ncroft@vidalia-city.k12.ga.us.
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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY STATEMENT OF NET POSITION JUNE 30, 2019
ASSETS
Cash and Cash Equivalents Investments Receivables, Net
Taxes State Government Federal Government Local Other Inventories Capital Assets, Non-Depreciable Capital Assets, Depreciable (Net of Accumulated Depreciation)
Total Assets
DEFERRED OUTFLOWS OF RESOURCES
Related to Defined Benefit Pension Plans Related to OPEB Plan
Total Deferred Outflows of Resources
LIABILITIES
Accounts Payable Salaries and Benefits Payable Interest Payable 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 Plans 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

$

7,133,523.45

89,205.96

3,048,950.63 2,133,969.61
417,235.25 7,053.50
174,060.98 50,538.69
808,422.05 57,649,483.44

71,512,443.56

4,365,012.16 1,277,365.00
5,642,377.16

3,021.80 2,526,386.49
305,390.83 19,617,214.00 17,444,181.00
807,728.38 19,513,427.75
60,217,350.25

1,232,997.00 3,717,763.00
4,950,760.00

38,480,832.39
854,681.29 761,406.15 2,202,242.80 (30,312,452.16)

$

11,986,710.47

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

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CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY STATEMENT OF ACTIVITES JUNE 30, 2019

GOVERNMENTAL ACTIVITIES
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 Short-Term and Long-Term Debt
Total Governmental Activities
General Revenues Taxes Property Taxes For Maintenance and Operations Sales Taxes Special Purpose Local Option Sales Tax For Capital Projects Grants and Contributions not Restricted to Specific Programs Investment Earnings Miscellaneous
Total General Revenues
Change in Net Position
Net Position - Beginning of Year
Net Position - End of Year

EXPENSES

CHARGES FOR SERVICES

$ 16,334,361.64 $
1,896,303.07 742,468.52 463,347.64 529,764.03
1,398,017.49 303,974.33
2,734,747.13 830,961.74 5,712.50 27,679.53
80,696.28 81,831.38 1,762,149.07 627,360.78
$ 27,819,375.13 $

164,481.73
-
158,403.84 73,709.00 81,120.89 -
477,715.46

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

- 2 -

EXHIBIT "B"

PROGRAM REVENUES OPERATING GRANTS AND
CONTRIBUTIONS

CAPITAL GRANTS AND CONTRIBUTIONS

NET (EXPENSES) REVENUES
AND CHANGES IN NET POSITION

$

12,832,770.65 $

226,923.05 321,187.43 327,455.93 543,458.00 714,747.33
818.88 734,010.80 240,991.44
-

1,701,848.26 -

$

17,644,211.77 $

824,994.60 $
95,069.14 881.41
34,057.91 78,732.08 26,943.22
3,703.37 23,512.74 26,333.82
-
82,852.91 -
1,197,081.20

(2,512,114.66)
(1,574,310.88) (420,399.68) (101,833.80) 92,426.05 (656,326.94) (299,452.08)
(1,977,223.59) (563,636.48) (5,712.50) (27,679.53)
77,707.56 (8,122.38) 103,672.99 (627,360.78)
(8,500,366.70)

5,283,408.23
2,269,393.44 1,081,837.00
3,082.73 1,122,902.54
9,760,623.94
1,260,257.24
10,726,453.23

$

11,986,710.47

- 3 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY BALANCE SHEET
GOVERNMENTAL FUNDS JUNE 30, 2019

EXHIBIT "C"

ASSETS
Cash and Cash Equivalents Investments Receivables, Net
Taxes State Government Federal Government Local Other Inventories

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$ 4,104,451.02 $ 1,962,275.45 $ 1,066,796.98 $

89,205.96

-

-

2,850,081.28

198,869.35

-

2,092,871.61

41,098.00

-

417,235.25

-

-

7,053.50

-

-

174,060.98

-

-

50,538.69

-

-

7,133,523.45 89,205.96
3,048,950.63 2,133,969.61
417,235.25 7,053.50
174,060.98 50,538.69

Total Assets
LIABILITIES
Accounts Payable Salaries and Benefits Payable
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Unavailable Revenue - Property Taxes
FUND BALANCES
Nonspendable Restricted Unassigned
Total Fund Balances

$ 9,785,498.29 $ 2,202,242.80 $ 1,066,796.98 $ 13,054,538.07

$

3,021.80 $

2,526,386.49

2,529,408.29

- $ -
-

- $ -
-

3,021.80 2,526,386.49
2,529,408.29

1,582,457.52

-

-

1,582,457.52

50,538.69 804,142.60 4,818,951.19
5,673,632.48

2,202,242.80
-
2,202,242.80

1,066,796.98
-
1,066,796.98

50,538.69 4,073,182.38 4,818,951.19
8,942,672.26

Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 9,785,498.29 $ 2,202,242.80 $ 1,066,796.98 $ 13,054,538.07

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

- 4 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET POSITION JUNE 30, 2019

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 Buildings and improvements Equipment Land improvements Accumulated depreciation
Some liabilities are not due and payable in the current period and, therefore, are not reported in the funds.
Net pension liability Net OPEB liability
Deferred outflows and inflows of resources related to pensions and 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.
Bonds payable Accrued interest payable Unamortized bond premium

$

8,942,672.26

$

808,422.05

64,932,151.05

2,462,807.22

2,726,720.19

(12,472,195.02)

58,457,905.49

$ (19,617,214.00) (17,444,181.00)

(37,061,395.00)

$

3,132,015.16

(2,440,398.00)

691,617.16 1,582,457.52

$ (18,400,000.00) (305,390.83)
(1,921,156.13)

(20,626,546.96)

Net position of governmental activities (Exhibit "A")

$

11,986,710.47

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

- 5 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2019

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 Interest
Total Expenditures
Revenues over (under) Expenditures
OTHER FINANCING SOURCES (USES)
Transfers In Transfers Out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances - Beginning

GENERAL FUND

CAPITAL PROJECTS
FUND

DEBT SERVICE
FUND

TOTAL

$

5,612,113.67 $

-

15,483,492.10

3,568,235.67

477,715.46

1,812.65

1,122,902.54

26,266,272.09

- $ 2,269,393.44
867,081.20 -
1,270.08 -
3,137,744.72

- $

5,612,113.67

-

2,269,393.44

-

16,350,573.30

-

3,568,235.67

-

477,715.46

-

3,082.73

-

1,122,902.54

-

29,404,016.81

15,699,113.40
1,835,918.25 749,756.74 442,827.22 463,421.41
1,417,046.12 306,653.62
2,020,330.74 751,693.09 5,712.50 27,679.53 80,696.28 82,502.56
1,682,927.06 -
-
25,566,278.52
699,993.57

408,519.84
689,650.00 125,000.00 1,247,668.71
-
2,470,838.55
666,906.17

-
-
685,000.00 740,797.50
1,425,797.50
(1,425,797.50)

16,107,633.24
1,835,918.25 749,756.74 442,827.22 463,421.41
1,417,046.12 306,653.62
2,709,980.74 876,693.09 5,712.50 27,679.53 80,696.28 82,502.56
1,682,927.06 1,247,668.71
685,000.00 740,797.50
29,462,914.57
(58,897.76)

699,993.57 4,973,638.91

(1,435,000.00) (1,435,000.00)
(768,093.83) 2,970,336.63

1,435,000.00 -
1,435,000.00 9,202.50
1,057,594.48

1,435,000.00 (1,435,000.00)
(58,897.76) 9,001,570.02

Fund Balances - Ending

$

5,673,632.48 $

2,202,242.80 $

1,066,796.98 $

8,942,672.26

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

- 6 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN THE FUND BALANCES
TO THE STATEMENT OF ACTIVITIES JUNE 30, 2019

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.
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.
Bond principal retirements Amortization of bond premium
District pension 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 and OPEB liability is measured a year before the District's report date. Pension and OPEB expense, which is the change in the net pension and OPEB liability adjusted for changes in deferred outflows and inflows of resources related to pensions and 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

$

(58,897.76)

$

1,232,348.51

(1,009,250.09)

223,098.42 (26,925.63) (328,705.44)

$

685,000.00

107,728.38

792,728.38

$

692,480.93

(39,230.00)

653,250.93

5,708.34

Change in net position of governmental activities (Exhibit "B")

$ 1,260,257.24

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

- 7 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY STATEMENT OF FIDUCIARY NET POSITION FIDUCIARY FUNDS JUNE 30, 2019
ASSETS Cash and Cash Equivalents
LIABILITIES Funds Held for Others

EXHIBIT "G"

AGENCY FUNDS

$

90,040.91

$

90,040.91

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

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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

NOTE 1: DESCRIPTION OF SCHOOL DISTRICT AND REPORTING ENTITY
REPORTING ENTITY
The City of Vidalia 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, except for fiduciary activities. 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 non-fiduciary assets 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.
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.

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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

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, including fiduciary funds. Eliminations have been made to minimize the double counting of internal activities. Separate financial statements are presented for governmental and fiduciary funds. 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 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 (sales) legally restricted for the payment of general long-term principal and interest.
The School District reports the following fiduciary fund type:
Agency funds are used to report resources held by the School District in a purely custodial capacity (assets equal liabilities) and do not involve measurement of results of operations.
BASIS OF ACCOUNTING
The basis of accounting determines when transactions are reported on the financial statements. The government-wide and fiduciary fund 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 all revenues reported in the governmental funds to be available if they are collected within sixty 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

- 11 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

long-term debt, 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 2019, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 83, Certain Asset Retirement Obligations. This statement addresses accounting and financial reporting for certain asset retirement obligations (AROs). An ARO is a legally enforceable liability associated with the retirement of a tangible capital asset. A government that has legal obligations to perform future asset retirement activities related to its tangible capital assets should recognize a liability based on the guidance in this statement. The adoption of this statement did not have an impact on the School District's financial statements.
In fiscal year 2019, the School District adopted Governmental Accounting Standards Board (GASB) Statement No. 88, Certain Disclosures Related to Debt, including Direct Borrowings and Direct Placements. The primary objective of this statement is to improve the information that is disclosed in notes to government financial statements related to debt, including direct borrowings and direct placements. It also clarifies which liabilities governments should include when disclosing information related to debt. The School District included additional information in the Long-term Liabilities note disclosure.
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 interestearning 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.
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.
- 12 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

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.

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 or works of art.

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.

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

Capitalization Policy

Estimated Useful Life

Land

Land Improvements

$

Buildings and Improvements $

Equipment

$

Intangible Assets

$

All 10,000.00 10,000.00 10,000.00 100,000.00

N/A 60 years 25 to 60 years 10 to 15 years 10 years

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.

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 straight-line method. To conform to generally accepted accounting principles, bond premiums and

- 13 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

discounts should be amortized using the effective 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.
POSTEMPLOYMENT 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 Postemployment 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.
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.

- 14 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

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 City of Vidalia adopted the property tax levy for the 2018 tax digest year (calendar year) on October 10, 2018 (levy date) based on property values as of January 1, 2018. Taxes were due on December 20, 2018 (lien date). Taxes collected within the current fiscal year or within 60 days after year-end on the 2018 tax digest are reported as revenue in the governmental funds for fiscal year 2019. The Vidalia City Clerk bills and collects the property taxes for the School District. Property tax revenues, at the fund reporting level, during the fiscal year ended June 30, 2019, for maintenance and operations amounted to $5,419,872.29.
The tax millage rate levied for the 2018 tax year (calendar year) for the School District was as follows (a mill equals $1 per thousand dollars of assessed value):

School Operations

15.00 mills

Additionally, the Toombs County Tax Commissioner collects Title Ad Valorem 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. Title Ad Valorem Tax revenues, at the fund reporting level, amounted to $192,241.38 during fiscal year ended June 30, 2019.
SALES TAXES
Education Special Purpose Local Option Sales Tax (ESPLOST), at the fund reporting level, during the year amounted to $2,269,393.44 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 reauthorized at least every five years.
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.
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.
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 under review.
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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

NOTE 4: DEPOSITS
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.
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 amount of up to 125% if economic or financial conditions warrants. The program lists the types of eligible collateral. 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's 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.
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, 2019, the School District had deposits with a carrying amount of $7,312,670.32, which includes $89,205.96 in Certificates of Deposits that are reported as investments, and a bank

- 16 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

balance of $8,482,078.88. The bank balances insured by Federal depository insurance were $487,459.02. The bank balances included in the State's Secure Deposit Program (SDP) were $7,994,619.86.
Reconciliation of cash and cash equivalents balances to carrying value of deposits:

Cash and cash equivalents Statement of Net Position Statement of Fiduciary Net Position

$ 7,133,523.45 90,040.91

Total cash and cash equivalents

7,223,564.36

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

89,205.96

Less: Cash on hand

100.00

Total carrying value of deposits - June 30, 2019

$ 7,312,670.32

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, 2018

Increases

Decreases

Balances June 30, 2019

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

$ 808,422.05 $ 29,568,942.37

- $

- $

550,312.53 30,119,254.90

808,422.05 -

Total Capital Assets Not Being Depreciated

30,377,364.42

550,312.53 30,119,254.90

808,422.05

Capital Assets Being Depreciated Buildings and Improvements Equipment Land Improvements

34,704,668.06 2,031,357.90 2,710,020.19

30,227,482.99 557,107.89 16,700.00

125,658.57
-

64,932,151.05 2,462,807.22 2,726,720.19

Less Accumulated Depreciation for: Buildings and Improvements Equipment Land Improvements

9,226,278.27 1,599,469.79
735,929.81

872,203.93 91,739.98 45,306.18

98,732.94
-

10,098,482.20 1,592,476.83 781,235.99

Total Capital Assets, Being Depreciated, Net

27,884,368.28 29,792,040.79

26,925.63 57,649,483.44

Governmental Activities Capital Assets - Net $ 58,261,732.70 $ 30,342,353.32 $ 30,146,180.53 $ 58,457,905.49

- 17 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

Current year depreciation expense by function is as follows:

Instruction

$ 657,229.17

Support Services

Pupil Services

$ 75,734.24

Improvements of Instructional Services

743.11

Educational Media Services

27,132.64

General Administration

66,378.42

School Administration

21,465.39

Business Administration

3,122.28

Maintenance and Operation of Plant

19,823.41

Student Transportation Services

71,618.31

286,017.80

Food Services

66,003.12

$ 1,009,250.09

NOTE 6: INTERFUND TRANSFERS INTERFUND TRANSFERS Interfund transfers for the year ended June 30, 2019, consisted of the following:

Transfer to

Transfer From Capital Projects
Fund

Debt Service Fund

$

1,435,000.00

Transfers are used to move sales tax revenue collected by the capital projects fund to the debt service fund as needed to pay debt payments.

NOTE 7: LONG-TERM LIABILITIES The changes in long-term liabilities during the fiscal year for governmental activities were as follows:

Balance July 1, 2018

Governmental Activities

Balance

Additions

Deductions

June 30, 2019

Due Within One Year

General Obligation Bonds Unamortized Bond Premiums

$ 19,085,000.00 $ 2,028,884.51

- $ 685,000.00 $ 18,400,000.00 $ 700,000.00

-

107,728.38

1,921,156.13 107,728.38

$ 21,113,884.51 $

- $ 792,728.38 $ 20,321,156.13 $ 807,728.38

The School District had no unused line of credit or outstanding notes from direct borrowings and direct placements related to governmental activities as of June 30, 2019. In the event the entity is unable to make the principal and interest payments using proceeds of the Education Special Purpose Local Option Sales Tax (ESPLOST), the debt will be satisfied from the general fund or from a direct annual ad valorem tax levied upon all taxable property within the School District. Additional security is provided by the State of Georgia Intercept Program which allows for state appropriations entitled to the School District to be transferred to the Debt Service Account Custodian for the payment of debt.

- 18 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

GENERAL OBLIGATION DEBT OUTSTANDING

The School District's bonded debt consists of an issue 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 voterapproved sales taxes. General obligation bonds are direct obligations and pledge the full faith and credit of the School District.

Of the total amount originally authorized, $5,915,000.00 remains unissued. General obligation bonds currently outstanding are as follows:

Description

Interest Rates

Issue Date

Maturity Date

Amount Issued

Amount Outstanding

General Government - Series 2016

2.0% - 5.0% 4/14/2016 8/1/2037 $ 19,085,000.00 $ 18,400,000.00

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

2020 2021 2022 2023 2024 2025 - 2029 2030 - 2034 2035 - 2038

$

700,000.00 $ 722,438.00 $

725,000.00

701,063.00

740,000.00

675,388.00

775,000.00

651,869.00

785,000.00

631,375.00

4,275,000.00 2,809,376.00

5,285,000.00 1,738,025.00

5,115,000.00

500,375.00

107,728.38 107,728.38 107,728.38 107,728.38 107,728.38 538,641.90 538,641.90 305,230.43

Total Principal and Interest $ 18,400,000.00 $ 8,429,909.00 $ 1,921,156.13
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 described below, the School District carries commercial insurance for these risks. Settled claims resulting from these insured risks have not exceeded commercial insurance coverage in any of the past three fiscal years.
The School District has elected to self-insure for losses related to natural disasters. The School District has not experienced any losses related to this risk in the past three years.
UNEMPLOYMENT COMPENSATION
The School District is self-insured with regard to unemployment compensation claims. The School District accounts for claims within the general fund 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.

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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

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

2018 $

-

$

-

$

-

$

-

2019 $

-

$ 3,684.45 $ 3,684.45 $

-

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

Position Covered

Amount

Superintendent

$ 50,000.00

NOTE 9: FUND BALANCE CLASSIFICATION DETAILS

The School District's financial statements include the following amounts presented in the aggregate at June 30, 2019:

Nonspendable Inventories
Restricted Continuation of Federal Programs Capital Projects Debt Service
Unassigned

$

50,538.69

$ 804,142.60 2,202,242.80 1,066,796.98

4,073,182.38 4,818,951.19

Fund Balance, June 30, 2019

$ 8,942,672.26

When multiple categories of fund balance are available for 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.

NOTE 10: SIGNIFICANT COMMITMENTS

OPERATING LEASES

The School District leases copiers under the provisions of one or more long-term lease agreements classified as operating leases for accounting purposes. Rental expenditures under the terms of the operating leases totaled $66,799.92 for governmental activities for the year ended June 30, 2019. The following future minimum lease payments were required under operating leases at June 30, 2019:

Governmental

Year Ending

Funds

2020 2021 2022
Total

$

68,599.92

68,599.92

68,599.92

$ 205,799.76

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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

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.
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 postemployment 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 $743,819.00 for the year ended June 30, 2019. 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, 2019, the School District reported a liability of $17,444,181.00 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2018. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2017. An expected total OPEB liability as of June 30, 2018 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, 2018. At June 30, 2018, the School District's proportion was 0.137251%, which was a decrease of 0.002858% from its proportion measured as of June 30, 2017.

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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

For the year ended June 30, 2019, the School District recognized OPEB expense of $783,049.00. At June 30, 2019, the School District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

Deferred Outflows of Resources

OPEB

Deferred Inflows of Resources

Differences between expected and actual

experience

$

- $ 396,786.00

Changes of assumptions

-

2,955,128.00

Net difference between projected and actual

earnings on OPEB plan investments

23,602.00

-

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

509,944.00

365,849.00

School District contributions subsequent to

the measurement date

743,819.00

-

Total

$ 1,277,365.00 $ 3,717,763.00

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, 2020. 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

2020 2021 2022 2023 2024 Thereafter

$ (600,533.00) $ (600,533.00) $ (600,533.00) $ (601,943.00) $ (539,787.00) $ (240,888.00)

Actuarial assumptions: The total OPEB liability as of June 30, 2018 was determined by an actuarial valuation as of June 30, 2017 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, 2018:

OPEB:

Inflation

2.75%

Salary increases

3.25% - 9.00%, including inflation

Long-term expected rate of return

7.30%, compounded annually, net of investment expense, and including inflation

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CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

Healthcare cost trend rate

Pre-Medicare Eligible

7.50%

Medicare Eligible

5.50%

Ultimate trend rate

Pre-Medicare Eligible

4.75%

Medicare Eligible

4.75%

Year of Ultimate trend rate

Pre-Medicare Eligible

2028

Medicare Eligible

2022

Mortality rates were based on the RP-2000 Combined Mortality Table for Males or Females, as appropriate, with adjustments for mortality improvements based on Scale BB as follows:

For TRS members: The RP-2000 White Collar Mortality Table projected to 2025 with
projection scale BB (set forward 1 year for males) is used for death after service retirement and beneficiaries. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward two years for males and four years for females) is used for death after disability retirement.
For PSERS members: 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) is used for the period after service retirement and for beneficiaries of deceased members. The RP-2000 Disabled Mortality Table projected to 2025 with projection scale BB (set forward 5 years for both males and females) is used for the period after disability retirement.

The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the pension systems, which covered the five-year period ending June 30, 2014.
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, 2017 valuation were based on a review of recent plan experience done concurrently with the June 30, 2017 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

- 23 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

adding expected inflation. During fiscal year 2018, the School OPEB fund updated their investment strategy to a more long-term approach. 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
Fixed income Domestic Stocks -- Large Cap Domestic Stocks -- Mid Cap Domestic Stocks -- Small Cap Int'l Stocks - Developed Mkt Int'l Stocks - Emerging Mkt Alternatives
Total

Target allocation
30.00% 37.20%
3.40% 1.40% 17.80% 5.20% 5.00%
100.00%

Long-Term Expected Real Rate of Return*
(0.50)% 9.00%
12.00% 13.50%
8.00% 12.00% 10.50%

*Net of Inflation

Discount rate: The discount rate has changed since the prior measurement date from 3.58% to 3.87%. In order to measure the total OPEB liability for the School OPEB Fund, a single equivalent interest rate of 3.87% was used as the discount rate. This is comprised mainly of the yield or index rate for 20-year tax-exempt general obligation municipal bonds with an average rating of AA or higher (3.87% per the Bond Buyers Index). The projection of cash flows used to determine the discount rate assumed that contributions from members and from the employer 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 2118. Based on these assumptions, the OPEB plan's fiduciary net position was projected to be available to make OPEB payments for inactive employees through year 2018. Therefore, the calculated discount rate of 3.87% was applied to all periods of projected benefit payments to determine the total OPEB liability.
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 3.87%, 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 (2.87%) or 1 percentage-point higher (4.87%) than the current discount rate:

1% Decrease (2.87%)

Current Discount Rate (3.87%)

1% Increase (4.87%)

School District's proportionate share of the Net OPEB Liability

$ 20,369,333.00 $

17,444,181.00 $ 15,085,351.00

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 1-percentage-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

$ 14,665,463.00 $

17,444,181.00 $ 20,995,280.00

- 24 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

OPEB plan fiduciary net position: Detailed information about the OPEB plan's fiduciary net position is available in the Comprehensive Annual Financial Report (CAFR) which is publicly available at https://sao.georgia.gov/comprehensive-annual-financial-reports.
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 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. 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 2019. The School District's contractually required contribution rate for the year ended June 30, 2019 was 20.90% of annual School District payroll. For the current fiscal year, employer contributions to the pension plan were $2,657,538.16 from the School District.
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/formspubs/formspubs.
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 $15.00, 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.
- 25 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

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 $31,858.00.
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions
At June 30, 2019, the School District reported a liability of $19,617,214.00 for its proportionate share of the net pension liability for TRS.
The net pension liability for TRS was measured as of June 30, 2018. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2017. An expected total pension liability as of June 30, 2018 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, 2018.
At June 30, 2018, the School District's TRS proportion was 0.105684%, which was a decrease of 0.003370% from its proportion measured as of June 30, 2017.
At June 30, 2019, 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 $189,887.00.
The PSERS net pension liability was measured as of June 30, 2018. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2017. An expected total pension liability as of June 30, 2018 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, 2018.
For the year ended June 30, 2019, the School District recognized pension expense of $1,957,446.00 for TRS and $43,966.00 for PSERS and revenue of ($7,787.00) for TRS and $43,966.00 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.

- 26 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

At June 30, 2019, the School District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

TRS

Deferred

Deferred

Outflows of

Inflows of

Resources

Resources

Differences between expected and actual experience

$ 1,298,687.00 $ 40,432.00

Changes of assumptions

296,017.00

-

Net difference between projected and actual earnings on pension plan investments

-

536,373.00

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

112,770.00

656,192.00

School District contributions subsequent to the measurement date

2,657,538.16

-

Total

$ 4,365,012.16 $ 1,232,997.00

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, 2020. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended June 30:

TRS

2020

$ 936,553.00

2021

$ 350,988.00

2022

$ (689,758.00)

2023

$ (130,162.00)

2024

$

6,856.00

Actuarial assum ptions: The total pension liability as of June 30, 2018 was determined by an actuarial valuation as of June 30, 2017, using the following actuarial assumptions, applied to all periods included in the measurement:

Teachers Retirement System:
Inflation Salary increases Investment rate of return

2.75%
3.25% 9.00%, average, including inflation
7.50%, net of pension plan investment expense, including inflation

Post-retirement mortality rates were based on the 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) for service requirements and dependent beneficiaries. The RP-2000 Disabled Mortality table with future mortality improvement projected to 2025 with Society of

- 27 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

Actuaries' projection scale BB (set forward two years for males and four years for females) was used for the death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.

The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.

Public School Employees Retirement System:

Inflation

2.75%

Salary increases

N/A

Investment rate of return

7.30%, net of pension plan investment expense, including inflation

Post-retirement mortality rates were based on 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) for the period after service retirements and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB (set forward 5 years for both males and females) was used for death after disability retirement. There is a margin for future mortality improvement in the tables used by the System. Based on the results of the most recent experience study adopted by the Board on December 17, 2015, the numbers of expected future deaths are 9-11% less than the actual number of deaths that occurred during the study period for healthy retirees and 9-11% less than expected under the selected table for disabled retirees. Rates of mortality in active service were based on the RP-2000 Employee Mortality Table projected to 2025 with projection scale BB.
The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014.
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 asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset class

TRS Target allocation

PSERS Target allocation

Long-term expected real rate of return*

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

30.00% 39.80%
3.70% 1.50% 19.40% 5.60%
-

30.00% 37.20%
3.40% 1.40% 17.80% 5.20% 5.00%

(0.50)% 9.00% 12.00% 13.50% 8.00% 12.00% 10.50%

Total

100.00%

100.00%

* Rates shown are net of the 2.75% assumed rate of inflation
Discount rate: The discount rate used to measure the total TRS pension liability was 7.50%. The discount rate used to measure the total PSERS pension liability was 7.30%. 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

- 28 -

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2019

EXHIBIT "H"

contribution rates and the member rate. Based on those assumptions, the TRS and PSERS pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the 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 7.50%, 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 (6.50%) or 1-percentage-point higher (8.50%) than the current rate:

Teachers Retirement System:
School District's proportionate share of the net pension liability

1% Decrease (6.50%)

Current Discount Rate (7.50%)

1% Increase (8.50%)

$ 32,746,748.00 $

19,617,214.00 $ 8,797,810.00

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 http://www.ers.ga.gov/formspubs/formspubs.html.

DEFINED CONTRIBUTION PLAN

In 1999, the School District began 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 School District selected VALIC as the provider of this plan. For each employee covered under PSERS, the Board began contributing to the plan an amount equal to a 50% match of the employee's contribution up to 3% of the employee's base pay.

The employee becomes vested in the plan with five years of experience. Employees who had already achieved five years of experience at the time the plan was implemented were vested upon enrollment.

Funds accumulated in the employer paid accounts are only available to the employee upon termination of employment and five years of service to City of Vidalia Board of Education. If an employee terminates employment prior to achieving five years of service, funds paid on behalf of the non-vested employee are credited back to the School District.

Employer contributions for the current fiscal year and the preceding two fiscal years are as follows:

Fiscal Year

Percentage Contributed

Required Contribution

2019 2018 2017

100%

$

100%

$

100%

$

8,018.70 8,169.63 8,657.04

NOTE 14: TAX ABATEMENTS

The School District property tax revenues were reduced by $15,627.86 under agreements entered into by the Toombs County Development Authority. Under the Toombs County Development Authority annual budget for fiscal year 2019, Dot Foods Facility reimburses the School District for a portion of the reduction in tax revenues. The School District received $39,889.86 in fiscal year 2019.

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CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS RETIREMENT SYSTEM OF GEORGIA FOR THE YEAR ENDED JUNE 30

SCHEDULE "1"

Year Ended
2019 2018 2017 2016 2015

School District's proportion of the
net pension liability

School District's proportionate share of the net pension liability

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

Total

0.105684% $ 0.109054% $ 0.110474% $ 0.110872% $ 0.108299% $

19,617,214.00 $ 20,268,022.00 $ 22,792,018.00 $ 16,879,161.00 $ 13,682,150.00 $

21,770.00 30,321.00

$ 19,617,214.00 $ 20,268,022.00 $ 22,792,018.00 $ 16,900,931.00 $ 13,712,471.00

School District's covered payroll
$ 12,586,629.66 $ 12,521,868.84 $ 12,157,753.66 $ 11,718,322.21 $ 11,062,648.70

School District's proportionate share of the net pension liability as a percentage of its
covered payroll

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

155.86% 161.86% 187.47% 144.04% 123.68%

80.27% 79.33% 76.06% 81.44% 84.03%

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

- 31 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOLS EMPLOYEES RETIREMENT SYSTEM OF GEORGIA
FOR THE YEAR ENDED JUNE 30

SCHEDULE "2"

Year Ended
2019 2018 2017 2016 2015

School District's proportion of the net
pension liability

School District's proportionate share of the
net pension liability

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

Total

School District's covered payroll

School District's proportionate share of the net pension liability as a percentage of its covered
payroll

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

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

-

$

-

$

-

$

-

$

-

$

189,887.00 $ 189,887.00 $ 163,371.00 $ 163,371.00 $ 221,683.00 $ 221,683.00 $ 135,239.00 $ 135,239.00 $ 122,808.00 $ 122,808.00 $

530,294.91 508,517.47 498,322.64 471,421.68 450,257.47

N/A

85.26%

N/A

85.69%

N/A

81.00%

N/A

87.00%

N/A

88.29%

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

- 32 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY SCHOOL OPEB FUND
FOR THE YEAR ENDED JUNE 30

SCHEDULE "3"

Year Ended
2019 2018

School District's proportion of the net OPEB liability

School District's proportionate share of the net OPEB liability

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

Total

School District's covered employee
payroll

0.137251% $ 0.140109% $

17,444,181.00 $ 19,685,258.00 $

-

$ 17,444,181.00 $ 10,541,784.47

-

$ 19,685,258.00 $ 10,448,316.35

School District's proportionate share of the
net OPEB liability as a percentage of its covered-
employee payroll

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

165.48% 188.41%

2.93% 1.61%

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

- 33 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CONTRIBUTIONS
TEACHERS RETIREMENT SYSTEM OF GEORGIA FOR THE YEAR ENDED JUNE 30

SCHEDULE "4"

Year Ended
2019 2018 2017 2016 2015 2014 2013 2012 2011 2010

Contractually required contribution

Contributions in relation to the contractually required contribution

Contribution deficiency (excess)

$

2,657,538.16 $

2,657,538.16 $

-

$

2,115,812.23 $

2,115,812.23 $

-

$

1,786,873.33 $

1,786,873.33 $

-

$

1,734,913.72 $

1,734,913.72 $

-

$

1,540,959.37 $

1,540,959.37 $

-

$

1,358,493.26 $

1,358,493.26 $

-

$

1,237,180.06 $

1,237,180.06 $

-

$

1,126,961.75 $

1,126,961.75 $

-

$

1,136,385.67 $

1,136,385.67 $

-

$

1,140,065.54 $

1,140,065.54 $

-

School District's covered payroll

Contribution as a percentage of covered payroll

$ 12,715,495.38 $ 12,586,629.66 $ 12,521,868.84 $ 12,157,753.66 $ 11,718,322.21 $ 11,062,648.70 $ 10,842,945.31 $ 10,962,662.94 $ 11,054,335.31 $ 11,704,985.01

20.90% 16.81% 14.27% 14.27% 13.15% 12.28% 11.41% 10.28% 10.28%
9.74%

- 34 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND FOR THE YEAR ENDED JUNE 30

SCHEDULE "5"

Year Ended
2019 2018 2017

Contractually required contribution

Contributions in relation to the contractually required contribution

Contribution deficiency (excess)

$

743,819.00 $

743,819.00 $

-

$

711,360.00 $

711,360.00 $

-

$

730,540.00 $

730,540.00 $

-

School District's covered employee payroll

Contribution as a percentage of covered employee payroll

$

10,785,702.32

$

10,541,784.47

$

10,448,316.35

6.90% 6.75% 6.99%

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

- 35 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY NOTES TO THE REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2019

SCHEDULE "6"

Teachers Retirement System

Changes of assumptions: On November 18, 2015, th-e 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).



In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience.

Public School Employees Retirement System
Changes of assumptions: On March 15, 2018, the Board adopted a new funding policy. Because of this new funding policy, the assumed investment rate of return was reduced from 7.50% to 7.40% for June 30, 2017 actuarial valuation. In addition, based on the Board's new funding policy, the assumed investment rate of return was further reduced by 0.10% from 7.40% to 7.30% as of the June 30, 2018 measurement date.
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).
In 2010 and later, the expectation of retired life mortality was changed to the RP 2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience.
School OPEB Fund
Changes of benefit terms: There have been no changes in benefit terms.
Changes in assumptions: June 30, 2017 valuation: the June 30, 2017 actuarial valuation was revised, for various factors, including the methodology used to determine how employees and retirees were assigned to each of the OPEB Funds and anticipated participation percentages. Current and former employees of State organizations (including technical colleges, community service boards and public health departments) are now assigned to the State OPEB fund based on their last employee payroll location: irrespective of retirement affiliation.
The discount rate was updated from 3.58% as of June 30, 2017 to 3.87% as of June 30, 2018.

- 36 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2019

SCHEDULE "7"

REVENUES
Property 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
Total Expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Adjustments

NONAPPROPRIATED BUDGETS

ORIGINAL

FINAL

ACTUAL AMOUNTS

VARIANCE OVER/UNDER

$

4,973,187.36 $

4,863,187.36 $

5,612,113.67 $

15,049,786.00

15,464,535.30

15,483,492.10

3,704,005.00

3,658,949.00

3,568,235.67

583,537.00

583,537.00

477,715.46

1,660.00

1,660.00

1,812.65

902,819.00

1,157,694.00

1,122,902.54

25,214,994.36

25,729,562.66

26,266,272.09

748,926.31 18,956.80 (90,713.33)
(105,821.54) 152.65
(34,791.46)
536,709.43

15,766,690.82
1,840,162.58 562,684.22 456,208.50 445,944.66
1,413,490.00 280,734.00
1,963,415.90 730,474.64 23,025.00 34,045.00 80,495.00
1,807,424.00
25,404,794.32
(189,799.96)
4,973,638.91
-

16,052,313.92
1,816,437.00 581,400.00 455,448.50 459,426.00
1,415,530.00 282,349.00
1,962,573.23 724,433.00 33,525.00 34,045.00 80,495.00
1,790,294.00
25,688,269.65
41,293.01
4,973,638.91
2,877.37

15,699,113.40
1,835,918.25 749,756.74 442,827.22 463,421.41
1,417,046.12 306,653.62
2,020,330.74 751,693.09 5,712.50 27,679.53 80,696.28 82,502.56
1,682,927.06
25,566,278.52
699,993.57
4,973,638.91
-

353,200.52
(19,481.25) (168,356.74)
12,621.28 (3,995.41) (1,516.12) (24,304.62) (57,757.51) (27,260.09) (5,712.50) 5,845.47 (46,651.28) (2,007.56) 107,366.94
121,991.13
658,700.56
-
(2,877.37)

Fund Balances - Ending

$

4,783,838.95 $

5,017,809.29 $

5,673,632.48 $

655,823.19

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.

- 37 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS YEAR ENDED JUNE 30, 2019

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
Total Child Nutrition Cluster
Other Programs Pass-Through From Georgia Department of Education Food Services Fresh Fruit and Vegetable Program
Total U. S. Department of Agriculture
Education, U.S. Department of Special Education Cluster Pass-Through From Georgia Department of Education Special Education Grants to States Preschool Grants
Total Special Education Cluster
Other Programs Pass-Through From Georgia Department of Education Career and Technical Education - Basic Grants to States Rural Education Student Support and Academic Enrichment Program Supporting Effective Instruction State Grants Supporting Effective Instruction State Grants Title I Grants to Local Educational Agencies Title I Grants to Local Educational Agencies Twenty-First Century Community Learning Centers Twenty-First Century Community Learning Centers
Total Other Programs
Total U. S. Department of Education
Defense, U. S. Department of Direct Department of the Army R.O.T.C. Program

CFDA NUMBER

PASSTHROUGH
ENTITY ID
NUMBER

EXPENDITURES IN PERIOD

10.553 10.555

195GA324N1099 $ 195GA324N1099

415,529.50 1,170,643.02
1,586,172.52

10.582

195GA324L1603

24,785.10 1,610,957.62

84.027 84.173

H027A180073 H173A180081

84.048 84.358 84.424A 84.367 84.367 84.010 84.010 84.287 84.287

V048A180010 S365B180010 S424A180011 S367A170001 S367A180001 S010A170010 S010A180010 S287C170010 S287C180010

458,254.09 10,915.00
469,169.09
31,126.00 43,888.37 49,459.23
5,321.00 83,443.00 23,745.40 789,090.98 43,654.41 346,768.62
1,416,497.01
1,885,666.10
47,958.97

Total Expenditures of Federal Awards

$

3,544,582.69

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 City of Vidalia Board of Education (the "Board") under programs of the federal government for the year ended June 30, 2019. 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.

- 38 -

CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY SCHEDULE OF STATE REVENUE YEAR ENDED JUNE 30, 2019

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 State Health Benefit Plan Employer Holiday Charter System Adjustment Categorical Grants Pupil Transportation Regular Nursing Services Education Equalization Funding Grant Other State Programs Food Services Math and Science Supplements Preschool Disability Services Facility Safety Bond Grant Vocational Education 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

CAPITAL

GENERAL

PROJECTS

FUND

FUND

TOTAL

$

686,644.30 $

- $

686,644.30

636,264.00 281,539.00 1,860,920.00 405,507.00 928,569.00 312,915.00 1,605,724.00 1,526,339.00 570,151.00 2,147,128.00 244,272.00
90,372.00 123,760.00
38,204.00 288,890.00
90,734.00 48,020.00
1,082.00
458,055.00 630,783.00 638,906.00 (132,300.00) 236,354.00
150,248.00 50,871.00
1,081,837.00
41,486.68 10,221.12 34,073.00
34,065.00 330,000.00
-
31,858.00

-
-
-
41,098.00 -
825,983.20
-

636,264.00 281,539.00 1,860,920.00 405,507.00 928,569.00 312,915.00 1,605,724.00 1,526,339.00 570,151.00 2,147,128.00 244,272.00
90,372.00 123,760.00
38,204.00 288,890.00
90,734.00 48,020.00
1,082.00
458,055.00 630,783.00 638,906.00 (132,300.00) 236,354.00
150,248.00 50,871.00
1,081,837.00
41,486.68 10,221.12 34,073.00 41,098.00 34,065.00 330,000.00
825,983.20
31,858.00

$ 15,483,492.10 $

867,081.20 $ 16,350,573.30

See notes to the basic financial statements.

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CITY OF VIDALIA BOARD OF EDUCATION - TOOMBS COUNTY SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS
YEAR ENDED JUNE 30, 2019

SCHEDULE "10"

PROJECT

ORIGINAL ESTIMATED
COST (1)

CURRENT ESTIMATED COSTS (2)

AMOUNT EXPENDED IN CURRENT YEAR (3) (4)

AMOUNT EXPENDED IN PRIOR YEARS (3) (4)

TOTAL COMPLETION
COST

EXCESS PROCEEDS NOT
EXPENDED

ESTIMATED COMPLETION
DATE

PROJECT III

(i) To purchase textbooks, furniture, additional instructional materials and equipment for all sites; $

1,100,000.00 $

1,100,000.00 $

659,826.24 $

80,874.25 $

- $

-

December 2019

(ii) To expand technology usage and improve

communication and safety capabilities to

include, but not be limited to,the upgrade

of electrical capacity at J.R.Trippe Middle

School and Vidalia Comprehensive High

School; safety and security upgrades at all

facilities, and technology upgrades system-wide;

1,065,000.00

1,254,246.89

474,243.60

780,003.29

-

-

December 2019

(iii) To acquire, improve, and maintain facilities

for Vidalia schools to include, but not be limited

to, tempered HVACat Vidalia Comprehensive

High School and J.R. Trippe Middle School gyms;

kitchen expansions at Vidalia Comprehensive

High School; maintaining roofing warranties

throughout the System; and

11,725,000.00

33,418,347.22

1,193,528.21

30,848,055.28

-

-

December 2019

(iv) To expand and maintain student transportation

to include but not be limited to purchase of

additional student regular transportation and

activity vehicles.

270,000.00

270,000.00

143,240.50

121,228.00

-

-

December 2019

$ 14,160,000.00 $ 36,042,594.11 $ 2,470,838.55 $ 31,830,160.82 $

- $

-

(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 Toombs 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.

(4) In addition to the expenditures shown above, the School District has incurred interest to provide advance funding for the above projects as follows:

Prior Years Current Year

$ 1,341,873.52 739,788.00

$ 2,081,661.52

See notes to the basic financial statements.

- 41 -

SECTION II COMPLIANCE AND INTERNAL CONTROL REPORTS

Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400

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 Superintendent and Members of the City of Vidalia Board of Education
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Vidalia Board of Education (School District), as of and for the year ended June 30, 2019, 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 25, 2020.
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) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the 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 combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the 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 determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the 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,

March 25, 2020

Greg S. Griffin State Auditor

Greg S. Griffin
STATE AUDITOR
(404) 656-2174

DEPARTMENT OF AUDITS AND ACCOUNTS
270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400

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 Superintendent and Members of the City of Vidalia Board of Education
Report on Compliance for Each Major Federal Program
We have audited the City of Vidalia Board of Education's (School District) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2019. 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.
Management's Responsibility
Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs.
Auditor's Responsibility
Our responsibility is to express an opinion on compliance for each of the School District's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; 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). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the School District's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the School District's compliance.

Opinion on Each Major Federal Program
In our opinion, the School District complied, in all material respects, with the types of 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, 2019.
Report on Internal Control over Compliance
Management of the School District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the School District's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program 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 internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the School District's 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 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 first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
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,

March 25, 2020

Greg S. Griffin State Auditor

SECTION III AUDITEE'S RESPONSE TO PRIOR YEAR FINDINGS AND QUESTIONED COSTS

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY AUDITEE'S RESPONSE
SUMMARY SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2019
PRIOR YEAR FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS
No matters were reported.
PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
No matters were reported.

SECTION IV FINDINGS AND QUESTIONED COSTS

CITY OF VIDALIA BOARD OF EDUCATION TOOMBS COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2019
I SUMMARY OF AUDITOR'S RESULTS

Financial Statements

Type of auditor's report issue: Governmental Activities; General Fund; Capital Projects Fund; Debt Service Fund; Aggregate Remaining Fund Information
Internal control over financial reporting: Material weakness identified? Significant deficiency identified?
Noncompliance material to financial statements noted:

Unmodified
No None Reported
No

Federal Awards
Internal Control over major programs: Material weakness identified? Significant deficiency identified?

No None Reported

Type of auditor's report issued on compliance for major programs: All major programs

Unmodified

Any audit findings disclosed that are required to be reported in

accordance with 2 CFR 200.516(a)?

No

Identification of major programs:

CFDA Numbers

Name of Federal Program or Cluster

10.553, 10.555

Child Nutrition Cluster

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

$750,000.00

Auditee qualified as low-risk auditee?

Yes

II FINANCIAL STATEMENT FINDINGS AND QUESTIONED COSTS No matters were reported. III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.