Comprehensive Annual Financial Report Fiscal Year Ended June 30, 2018 1058 Fifth Avenue Jonesboro, Georgia 30236 Comprehensive Annual Financial Report Fiscal Year Ended June 30, 2018 Prepared by: Division of Business Services 1058 Fifth Avenue Jonesboro, Georgia 30236 CLAYTON COUNTY BOARD OF EDUCATION COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2018 _____________________________________________________________________________ TABLE OF CONTENTS Page INTRODUCTORY SECTION Letter of Transmittal .............................................................................................................................................. i v Clayton County Board of Education Function and Composition ......................................................................... vi Clayton County Board of Education Elected Officials and Superintendent of Schools ........................................................................................................................ vii Executive Staff ......................................................................................................................................................... viii Organizational Chart.................................................................................................................................................. ix Certificate of Achievement for Excellence in Financial Reporting .........................................................................x FINANCIAL SECTION Independent Auditor's Report ............................................................................................................................. 1 3 Management's Discussion and Analysis ......................................................................................................... 4 14 Basic Financial Statements Government-wide Financial Statements: Statement of Net Position.......................................................................................................................... 15 Statement of Activities................................................................................................................... 16 and 17 Fund Financial Statements: Balance Sheet Governmental Funds..................................................................................................... 18 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position ........................................................................................................ 19 Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds ....................................................................................................... 20 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities......................................... 21 General Fund Statement of Revenues, Expenditures and Changes in Fund Balances Budget (Non-GAAP) and Actual ........................................................................... 22 Statement of Net Position Proprietary Funds ...................................................................................... 23 Statement of Revenues, Expenses and Changes in Fund Net Position Proprietary Funds.............................................................................................................. 24 Statement of Cash Flows Proprietary Funds ........................................................................... 25 and 26 Statement of Fiduciary Assets and Liabilities Agency Fund.............................................................. 27 Notes to Financial Statements .................................................................................................................. 28 68 CLAYTON COUNTY BOARD OF EDUCATION COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2018 _____________________________________________________________________________ TABLE OF CONTENTS (CONTINUED) Page REQUIRED SUPPLEMENTARY INFORMATION Schedule of Proportionate Share of the Net Pension Liability Teachers' Retirement System of Georgia ........................................................................................................ 69 Schedule of Contributions Teachers' Retirement System of Georgia ............................................................. 70 Notes to Required Supplementary Information Teachers' Retirement System of Georgia ........................................................................................................ 71 Schedule of Proportionate Share of the Net Pension Liability Public School Employees' Retirement System ............................................................................................... 72 Notes to Required Supplementary Information Public School Employees' Retirement System ............................................................................................... 73 Schedule of Proportionate Share of the Net Pension Liability Employees' Retirement System ........................................................................................................................ 74 Schedule of Contributions Employees' Retirement System ............................................................................. 75 Notes to Required Supplementary Information Employees' Retirement System ........................................................................................................................ 76 Schedule of Proportionate Share of the Net OPEB Liability School OPEB Fund............................................................................................................................................. 77 Schedule of Contributions School OPEB Fund .................................................................................................. 78 Notes to Required Supplementary Information School OPEB Fund............................................................................................................................................. 79 COMBINING FUND SCHEDULES Combining Balance Sheet Nonmajor Governmental Funds...................................................................... 80 82 Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds............................................................................................ 83 85 Special Revenue Funds Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual Nonmajor Governmental Funds................................................................................................................ 86 94 Statement of Changes in Assets and Liabilities Agency Fund ............................................................. 95 and 96 CLAYTON COUNTY BOARD OF EDUCATION COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2018 _____________________________________________________________________________ TABLE OF CONTENTS (CONTINUED) Page STATISTICAL SECTION Financial Trends: Net Position by Component Last Ten Fiscal Years ..................................................................................... 97 Changes in Net Position Last Ten Fiscal Years ................................................................................. 98 101 Fund Balances, Governmental Funds Last Ten Fiscal Years................................................................... 102 Changes in Fund Balances, Governmental Funds Last Ten Fiscal Years ................................ 103 and 104 Revenue Capacity: Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years ......................................................................................................................... 105 and 106 Direct and Overlapping Property Tax Rates Last Ten Fiscal Years ......................................................... 107 Principal Property Taxpayers Current Year and Nine Years Ago............................................................. 108 Property Tax Levies and Collections Last Ten Tax Years ........................................................................ 109 Schedule of Revenues by Source Governmental Funds Last Ten Fiscal Years ............................................................................................................... 110 and 111 Debt Capacity: Ratios of Outstanding Debt by Type Last Ten Fiscal Years ..................................................................... 112 Direct and Overlapping Governmental Activities Debt ................................................................................ 113 Legal Debt Margin Information Last Ten Fiscal Years ................................................................ 114 and 115 Demographic and Economic Information: Demographic and Economic Statistics Last Ten Fiscal Years................................................................. 116 Principal Employers Current Year and Nine Years Ago ............................................................................ 117 Student Ethnicity Statistics Last Ten Fiscal Years ...................................................................... 118 and 119 Operating Information: Student Enrollment Statistics Last Ten Years............................................................................................ 120 Teachers' Base Salaries Last Ten Fiscal Years ......................................................................................... 121 History of High School Graduates Last Ten School Years ....................................................................... 122 Ratio of Pupils to Professional Personnel Last Ten Fiscal Years............................................................ 123 Cost Per Pupil Enrolled Last Fiscal Ten Years........................................................................................... 124 Nutrition Services Facts and Figures Last Ten Fiscal Years................................................... 125 and 126 School Building Information Last Ten Fiscal Years ........................................................................ 127 132 CLAYTON COUNTY BOARD OF EDUCATION COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2018 _____________________________________________________________________________ TABLE OF CONTENTS (CONTINUED) Page SINGLE AUDIT SECTION 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 ...................................................................................................... 133 and 134 Independent Auditor's Report on Compliance For Each Major Federal Program and on Internal Control Over Compliance Required by the Uniform Guidance .................................................................................................................................. 135 137 Schedule of Expenditures of Federal Awards ........................................................................................... 138 140 Notes to Schedule of Expenditures of Federal Awards ...................................................................................... 141 Schedule of Findings and Questioned Costs ........................................................................................ 142 and 143 Schedule of Prior Year Findings ........................................................................................................................... 144 Introductory Section Clayton County Public Schools Clayton County Public Schools Divi ion of Business Services enue J n~bor, , Georgia 0236 (770) 473-2700 DR . MORCE J . B LE or Sup rin tcndcnt cho Is October 15, 2019 Honorable Members of the Clayton County Board of Education and Citizens of Clayton County , Georgia : The Comprehensive Annual Financial Report (CAFR) of the Clayton County Board of Education (Board) for the fiscal year ended June 30, 2018 , is submitted herewith. This report was prepared by the Business Services Division . Responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation , including all disclosures, rests with the management of the Board of Education . We believe the data, as presented , is accurate in all material aspects. We believe that it is presented in a manner designed to fairly set forth the financial position and results of operations of the Board of Education as measured overall and by the financial activity of its various funds. The data includes all disclosures and requ ired supplementary information necessary to enable the reader to gain the maximum understand ing of the Board's financia l activity. Readers of this report are encouraged to consider the information presented here in conjunction with add itional information presented in Management's Discussion and Analysis beginning on page 4 of th is report. The Board's History and Services Clayton County, Georgia , was created by an act of the State Leg islature on November 30, 1858. It was named for the Honorable Augustin S. Clayton (1783-1839), a judge of the Western Circuit of Georgia, a member of the legislature and of Congress. The City of Jonesboro is the county seat and was orig inally called "Leaksville". The State of Georgia granted a charter for the Leaksville Academy on December 22 , 1823 and Mr. Allen D. Candler organized the Clayton High School around the year 1858. Georgia had no regularly organized system of common schools supported by public taxation before the War Between the States, although unsuccessful efforts were made in 1845 and again in 1856 to inaugurate such a program . The first real school organization came about as a result of an act on October 13, 1870. The Clayton County School System operated from 1870-1890 under the supervision of a County Commission of Education. Data indicates that the Clayton County School System as it is known today was formally established by an act of the State Legislature in Jonesboro on September 21 , 1891 , and a tax was levied on taxable property in the amount of 7 1h mills . A Board of Education composed of nine members was authorized and provision was made to receive a pro-rata share of county funds for schools. Today the nine-member elected Board of Education has full authority to control and manage the schools with in Clayton County. Clayton County Public Schools is the fifth largest school system in the State of Georgia with approximately 55,000 students currently enrolled in 36 elementary schools , 14 middle schools, one K-8 school , 11 high schools, one alternative school program and one high school alternative program for the budget year of 2017 - 2018. - - - - - - - - - - - - - - Clayton County Board f Education - - - - - -- - -- -- - w, w.clayton .kl2 .ga .u The Board provides all basic services required by state law and policies of the State Board of Education and State Department of Education. These services include: preschool for three and fouryear old students with disabilities, regular preschool for four-year olds students, regular and special education instructional programs at the elementary (kindergarten through 5th grade), middle (6th through 8th grade), and secondary (9th through 12th grade) levels. Additional services include programs for Career Technical Education in partnersh ip with post-secondary institutions in the area as well as joint enrollment opportunities for high school students with Clayton State University and Atlanta Technical College. Economic Condition and Outlook Clayton County is part of the Metropolitan Atlanta Area, and is south of the City of Atlanta. HartsfieldJackson Atlanta International Airport is within the boundaries of Clayton County. It consistently ranks as the world's second largest cargo facility and the country's busiest airport. Hartsfield-Jackson Atlanta International Airport is the primary economic driver of the County and region. In 2012, the Airport opened the new Maynard H. Jackson International terminal expanding the economic impact to Clayton County. Five of the school system's largest taxpayers have businesses directly related to operations at the airport. FY 2015 marked a turning point in the recovery of the local economy from the recession that continued during FY 2017. Property value is rebounding slowly with a slight increase in the residential base. The collection of County revenues has stabilized and Clayton County Public Schools has seen an increase in Special Purpose Local Option Sales Tax (SPLOST) collections. Although commercial values remained down , the overall tax base of the county improved by approximately 4.8% from FY 2017 to FY 2018. This resulted in an increase of $5.3 million in local tax revenues to the school system. Further, a reduction in the austerity cuts to the "Quality Basic Education" Act funding continued. Clayton County Public Schools continues to make difficult financial decisions in order to remain fiscally sound. Long-Term Financial Planning The school system prioritizes its capital improvements based upon the approved referendums adopted by the citizens of Clayton County. Capital needs are prioritized by student population and facility repair and maintenance needs. These projects are funded by the 2013 Special Purpose Local Option Sales Tax (SPLOST) and remaining projects from the 2009 SPLOST, in addition to state capital outlay funds from the State of Georgia Department of Education. Renovations, additions, and new construction are continuously underway as the school system works to ensure that its facilities provide a safe and welcoming environment. On March 19th, 2019, Clayton County citizens voted YES! for SPLOST VI. The approved SPLOST will be for the term of years 2020 - 2024 for a total of $280 Million . SPLOST VI will be utilized for the new construction of facilities, major renovations and modifications to existing facilities as well as transportation and technology needs for the district. SP LOST VI revenues will begin accumulation on January 1st of 2020. SPLOST VI will be used for the construction of four new schools, one stadium, one new bus facility, renovations of existing facilities as well as transportation and technology needs for all students. The school system has financial policies that provide us with an infrastructure for our future financial management decisions. These policies cover topics including operating budget, reserve fund balances, accounting and financial reporting , and purchasing. Major Initiatives During FY 2017 the district purchased a new enterprise resource planning (ERP) system. Implementation will take place over FY 2018 and FY 2019. This system is expected to improve operational efficiencies in Finance, Human Resources, and Technology. II - - - - - - -- - - -- - - Clayton County Board of Education - - -- - - - - - - - - - - Utilizing SPLOST funds, the Board of Education substantially completed construction of a new gymnasium at Riverdale High School and a new school for the Elite Scholars Academy. Construction of a new East Clayton Elementary also continued . Additional initiatives include; Lee Street Elementary renovation, Arnold Elementary Renovations, and HVAC replacement at six existing schools. In addition to its support of general technology hardware/software expenditures, SPLOST V is providing the financial support for the first phase of Extending Learning Beyond the Classroom. Clayton County government implemented a multi-year Road Infrastructure Improvement Program which is helping our schools. The road program encompasses various safety projects including the installation of 96 miles of sidewalk, improving access and traffic congestion at schools. Clayton County is also installing school flashers for every school and adding reduced speed zone signs. Mission Statement The mission of Clayton County Public Schools is to empower students to achieve academic and personal goals. Vision Statement The vision of Clayton County Public Schools is to be a district of high performance preparing ALL students to live and compete successfully in a global society. Core Belief Statements We believe children have priority for all of our resources. We believe education is the shared responsibility of the student, the parent/guardian , the school , and the community. We believe communication and understanding among all stakeholders of our diverse community are essential to achieving the goals of education . We believe that learning is a continuous process and most productive when the needs of each child are met through instruction provided by competent and caring teachers. We believe a learning environment where children experience security, care, dignity, and respect is essential. Strategic Goals 1. To increase academic achievement for all students in Clayton County Public Schools as evidenced by state, national and international assessment results. 2. To provide and maintain a safe, orderly and secure learning environment. 3. To create an environment that promotes active engagement, accountability, and collaboration of all stakeholders to maximize student achievement. 4. To provide high quality support services delivered on time and within budget to promote student academic success in the Clayton County Public Schools. 5. To recruit, develop, and retain highly qualified and effective staff. Accounting System Internal Controls In developing and evaluating the Board of Education's accounting system , consideration is given to the adequacy of internal controls. Internal accounting controls are designed to provide assurance of the following within reasonable constraints: the safeguarding of assets and gains and losses from unauthorized use and/or disposition the reliability of financial records for preparing financial statements and maintaining accountability for assets iii - -- - - - - - - - - - - - Clayton County Board of Education - - -- - - - - - - - - - - Budgetary Controls An annual budget is prepared in accordance with state law. Budgetary control is maintained at the fund level by encumbrance accounting. The budget process is comprised of five phases - planning, preparation , adoption, implementation and evaluation. These phases ensure adequate administration and control of all Board funds. To maintain compliance with Board budget policies and State of Georgia law, a budget development calendar is adopted by the Board of Education in October of each year. The calendar outlines the budget development process for the next fiscal year. The budget process is inclusive of central level and school level staff as well as a citizen's budget committee. Work sessions with the Board and public hearings are held prior to the adoption of the budget in June of each year. Single Audit As a recipient of federal financial assistance, the Board is responsible for ensuring that adequate internal controls are in place to ensure compliance with applicable laws and regulations related to these programs. These internal controls are subject to periodic evaluation by the Board's management. Independent Audit The Clayton County Board of Education and the State of Georgia requ ire an annual audit of the school district's financial statements by independent certified public accountants. Mauldin and Jenkins is the current accounting firm under contract with the Board to perform this function. The Independent Auditor's Report on the Basic Financial Statements is included in the financial section of this report. The auditor's reports related specifically to the single audit are included in the Single Audit section. Financial Reporting Awards The Clayton County Public School System submitted its comprehensive annual financial report (CAFR) for review by the Association of School Business Officials (ASBO) for consideration in the Certificate of Excellence in Financial Reporting Program. With great pride, the Clayton County Public School System received the ASBO Certificate of Excellence every year from 2007-2011, and then again 2015 - 2017. The receipt of this award confirmed that the reports substantially conform to the principles and standards of financial reporting as recommended and adopted by the Association of School Business Officials International. The award was granted only after an extensive review of financial reports by an expert panel of certified public accountants and practicing school business officials. The Government Finance Officers Association of the United States and Canada (GFOA) awarded the Certificate of Achievement for Excellence in Financial Reporting to Clayton County Public Schools for its comprehensive annual financial report for the fiscal year ended June 30, 2018. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized comprehensive annual financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current comprehensive annual financial report continues to meet the Certificate of Achievement Program's requirements and we are submitting it to the GFOA to determine its eligibility for another certificate. IV - - - - - - - - - - -- - - Clayton County Board of Education - - - - - - - - - -- - - - Acknow ledgements We wish to express our appreciation to the Business Services Division staff members whose ded icated efforts have enabled this report to be prepared . Respectfully submitted, Morcease Beasley Superintendent V - - -- - - -- - - -- - - Clayton County Board of Education - -- -- -- - - -- - - - CLAYTON COUNTY BOARD OF EDUCATION FUNCTION AND COMPOSITION JUNE 30, 2018 _____________________________________________________________________________ All matters relating to education and operation of the Clayton County Board of Education schools are governed and controlled by the Board of Education (the "School System"), as provided by Georgia Law. The School System has the responsibility to maintain a reasonably uniform system of public schools providing quality education for all young people of Clayton County. With the advice of the Superintendent, it must determine the policies and prescribe the rules and regulations for the management of the school system. The School System holds a work session and a regular public meeting once a month to conduct normal business. Additional called meetings are sometimes necessary for a specific purpose. The School System is composed of nine members who are elected on a district basis. Each member resides within one of the nine voting districts. The School System elects a Chairperson for a two-year term and a Vice Chairperson for a one-year term from its members. As of January 1, 2018 the members of the School System and years of expiration of their terms are as follows: TITLE Chairperson Vice Chairperson Board Member Board Member Board Member Board Member Board Member Board Member Board Member NAME Dr. Pam Adamson Dr. Alieka Anderson Mr. Mark Christmas Ms. Jessie Goree Mr. Michael King Ms. Ophelia Burroughs Ms. Judy Johnson Ms. Mary Baker Mr. Benjamin Straker TERM EXPIRES 12-31-2018 12-31-2018 12-31-2020 12-31-2020 12-31-2018 12-31-2020 12-31-2020 12-31-2020 12-31-2018 MISSION STATEMENT The mission of School System is to be accountable to all stakeholders for providing a globally competitive education that empowers students to achieve academic and personal goals and to become college and career ready, productive, responsible citizens. vi Clayton County Board of Education Elected Officials and Superintendent of Schools Chairperson Dr. Pam Adamson Mary Baker Mark Christmas Jessie Goree Michael King Ophelia Burroughs Judy Johnson Vice Chairperson Dr. Alieka Anderson Benjamin Straker Superintendent Dr. Morcease J. Beasley vii Clayton County Public Schools Executive Staff Superintendent's Office Dr. Morcease J. Beasley Superintendent Division of Operations Dr. Anthony Smith Mr. Kemith Thompson Mr. Samuel Coger Ms. Audrey Hamilton Mr. Ronick Joseph Mr. Kevin May Mr. Harold Walker Deputy Superintendent Executive Director of Operations Director of Maintenance Director of School Nutrition Director of Facilities Construction/SPLOST Director of Athletics Director of Transportation Division of School Leadership and Improvement Dr. Ralph Simpson Deputy Superintendent Dr. Keith Colbert Assistant Superintendent Cluster B Dr. Tim Guiney Assistant Superintendent Cluster A Dr. Douglas Hendrix Assistant Superintendent Cluster C Ms. Charmin Jackson Assistant Superintendent Cluster D Dr. Gloria Duncan Director of Professional Learning Dr. Ebony Lee Director of Curriculum, Instruction & Assessment Ms. Katrina Thompson Director of Federal Programs Dr. Monika Wiley Director of Fine Arts Division of School Support Dr. Sandra Nunez Dr. Angela Horrison-Collier Dr. Chantal Normil Ms. Trina Smith Deputy Superintendent Director of School Support Director of ESOL/World Languages Director of Special Education Division of Communications & Public Relations Ms. Jada Dawkins Chief of Communications/Public Relations Division of Business Services Ms. Emma Benton Ms. Debra Brewer Mr. Alfred Brown Chief Financial Officer Director of Purchasing Director of Finance Division of Equity & Compliance Ms. Damaris Garrett Director of Equity & Compliance Division of Human Resources Dr. Jamie Wilson Ms. Quantrishia Haynes Ms. Valerie Henderson Chief of Human Resources Director of Human Resources Director of Human Resources Division of Safety & Security Mr. Thomas Trawick Chief of Safety & Security Division of Technology Mr. Rod Smith Mr. Howard Langford Ms. April Mayo Mr. Wes Watkins Chief of Technology Director of Information Systems Director of Instructional Technology Director of Technical Operations viii Clayton County Public Schools Organizational Chart SY 2017-18 Clayton County Board of Education Superintendent of Schools Dr. Morcease J. Beasley Deputy Superintendent* 2nd In-Command Dr. A. Smith December 1, 2017 (*) Reflects Rotating Leadership Positions Deputy Superintendent* School Leadership & Improvement Dr. R. Simpson Deputy Superintendent* Student Support Svcs & Federal Programs Dr. S. Nunez Chief of Finance Mr. K. Thompson Chief of Safety & Security Mr. T. Trawick Chief of Human Resources Dr. J. Wilson Chief of Engagement, Governmental Relations & Partnerships Mr. W. Spiva Chief of Technology Mr. R. Smith Chief of Communications, Public Relations,& Marketing Ms. J Dawkins Assistant Superintendent Executive Director Dr. D. Hendrix Operations Dr. K Colbert Mr. K. Thompson Director Curriculum & Mr. T. Guiney Ms. C. Johnson Director Maintenance Director Sch Construction/ Splost Director ESOL Dr. C. Normil Director Purchasing Ms. D. Brewer Director Business Svcs Mr. D. Smith Instruction Dr. E. Lee Academic Coordinators Principals/ Programs Director Prof Learning Dr. G. Duncan Mr. S. Coger Director Transportation Mr. H. Walker Director Performing Arts Dr. M. Wiley Mr. R. Joseph Director Athletics Mr. K. May Director Special Education Ms. T. Smith Director Coordinator School Nutrition Athletics Ms. A. Hamilton Ms. J. Jackson Director Federal Programs Ms. K. Thompson Director Student Services Dr. A. Collier Coordinator Guid/Counsel Coordinator Position Ctrl Ms. L. Domzal Math - Dr. T. Clarke ELA. - Ms. E. Gray Social Science - Ms. R Wallace Science - Ms. J. Greenwood CTAE - Dr. E. Chillis Health/PE - Mr. P. Scott Early Childhood - Ms. V. Bedford Gifted - Ms. K. Heath Coordinator Prof Learning Ms. A. Tatum Coordinator Assessment Dr. N. Jefferson Coordinators Instructional Implementation Dr. D. Graham Mr. W. Clayton Ms. V. Jacobs Ms. C. Thompson Coordinator Transportation Ms. D. Brown Coordinator Transportation Ms. D. Hall Coordinators School Nutrition Ms. I. Farahdel Ms. T Lawrence Ms. Y. Alade Special Education Coordinators Ms. T. Bowman Ms. E. Dixon Ms. S. Cook Ms. S. Bullock Mr. D. Smalls Dr. A. Dunn Coordinator Financial Ops Mr. A. Brown Coordinator Payroll Ms. Y. Barber Adm Opns Commander Ms. D. Williams Field Opns Commander Mr. D. Britt ix Director Equity/Compliance Ms. D. Garrett Coordinator Personnel Review Ms. T. Reese Mr. R. Iddins Ms. C. Starkey Legal Compliance Officer Ms. L. Lowe Director Human Resources Mr. G. Curry Vacant Coordinator Performance Management Ms. A. Albritten Director Tech Opns Mr. W. Watkins Director Instruct Tech Ms. A. Mayo Director Info Systems Mr. H. Langford Coordinator Instructional Tech Mr. B. Harris Ms. S. Slay Coordinator Governmental Relations Vacant Coordinator Family Engmt Vacant Vacant Coordinator Student Info Ms. M. Barkley Coordinator Database Sys Ms. B. Brown Coordinator Communications Mr. C. White X Financial Section Clayton County Public Schools INDEPENDENT AUDITOR'S REPORT To the Superintendent and Members of the Clayton County Board of Education Jonesboro, Georgia Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the Clayton County Board of Education (the "School System") as of and for the year ended June 30, 2018, and the related notes to the financial statements, which collectively comprise the School System'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 principles 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. 300 MULBERRY STREET, SUITE 300 POST OFFICE BOX 1877 MACON, GEORGIA 31202-1877 478-464-8000 FAX 478-464-8051 www.mjcpa.com MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the School System as of June 30, 2018, and the respective changes in financial position and, where applicable, cash flows, thereof, and the budgetary comparison for the General Fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Emphasis of Matters As discussed in Note 12, the School System implemented Governmental Accounting Standard Board ("GASB") Statement No 75, Accounting and Financial Reporting for Post-employment Benefits Other Than Pensions, as of July 1, 2017. This standard significantly changed the accounting for the School System net other post-employment benefits ("OPEB") liability and the related disclosure. Our opinion is not modified with respect to this matter. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis (on pages 4 through 14) and the schedules of the School System's proportionate share of the net pension liability and the schedules of the School System's contributions, the schedule of proportionate share of the net OPEB liability and the schedule of OPEB contributions on pages 69 79 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the GASB 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 System's basic financial statements. The introductory section, combining and individual nonmajor fund financial statements and schedules, and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements. The schedule of expenditures of federal awards, 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 is presented for purposes of additional analysis and is also not a required part of the basic financial statements. 2 The combining and individual fund financial statements and schedules and the schedule of expenditures of federal awards, (collectively "the supplementary information") are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on them. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated January 31, 2020, on our consideration of the School System'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 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 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 Clayton County Board of Education's internal control over financial reporting and compliance. Macon, Georgia January 31, 2020 3 Management's Discussion and Analysis Clayton County Public Schools CLAYTON COUNTY BOARD OF EDUCATION MANAGEMENT'S DISCUSSION AND ANALYSIS JUNE 30, 2018 _____________________________________________________________________________ This section of Clayton County Board of Education's (the "School System") annual financial report presents its discussion and analysis of the School System's financial performance during the fiscal year ended June 30, 2018. The intent of this discussion and analysis is to examine the School System's financial performance as a whole. Readers should also review the financial statements and notes to the basic financial statements to enhance their understanding of the School System's financial condition. The reporting model is a combination of both government-wide financial statements and fund financial statements. The basic financial statements contain three components: 1. Government-wide financial statements including the Statement of Net Position and the Statement of Activities for both Governmental and Business-Type activities which provide a broad, long-term view of the School System's finances. 2. Fund financial statements including the balance sheets that provide a greater level of detail and focus on how well the School System has performed in the short term in the most significant or major funds. 3. Notes to the financial statements. This report presents the financial highlights for the year ended June 30, 2018, and other supplementary information. As with other sections of this financial report, the information contained within this Management's Discussion and Analysis should be considered only as part of a greater whole. The reader of this analysis should take the time to read and evaluate all sections of the report, including the notes to the financial statements. Financial Highlights Key financial highlights for fiscal year 2018 are as follows: Government-wide financial statements The assets and deferred outflows of the School System exceeded its liabilities and deferred inflows at the fiscal year ended June 30, 2018 by $97.7 million. Governmental Activities The School System experienced an increase of $23.7 million in net capital assets. This is the amount by which capital outlays exceeded depreciation in the current period. The net position of the total governmental activities decreased $5.6 million. The General Fund (the primary operating fund), presented on a current financial resources basis, ended the year with a fund balance of $23.1 million, a decrease of $18.9 million from June 30, 2017. The Capital Projects Fund ended the year with a fund balance of $52.7 million, an increase of $1.4 million. The School System decreased its outstanding long-term liabilities by $40.0 million primarily due to a reduction in net pension liability due in more than one year. 4 MANAGEMENT'S DISCUSSION AND ANALYSIS _____________________________________________________________________________ Program revenues, which include operating grants, accounted for $328.8 million, or 59.0% of the $556.8 million total revenues for governmental activities. General revenues, primarily property taxes and sales taxes accounted for $228.1 million, or 41.0%. The School System reported $562.4 million in expenses for the governmental activities. This amount was offset by the $328.8 million of program specific grants, charges for services or contributions indicated above. General revenues, primarily property taxes and sales taxes, were used to provide for the remaining expenses of these programs. Business-type Activities The net position of the School System's business-type activities increased $75.0 thousand. The School System has two business-type funds reported. The first is the school nutrition program and the second is the Performing Arts Center. Total expenses for school food service activities were $37.9 million, while expenses of the Performing Arts Center were $327 thousand. Program revenues, operating grants and contributions, and capital contributions for these business type activities totaled $38.3 million. Overview of the Financial Statements This annual report consists of three parts: management's discussion and analysis (this section), the basic financial statements, and required supplementary information. The basic financial statements include two kinds of statements that present different views of the School System: The first two statements are government-wide financial statements that provide both short-term and longterm information about the School System's overall financial status. The remaining statements are fund financial statements that focus on individual parts of the School System, reporting the School System's operations in more detail than the government-wide statements. The governmental funds statements tell how basic services such as instruction and instructional support services were financed in the short-term as well as what remains for future spending. Proprietary fund statements offer short and long-term financial information about the activities the School System operates like businesses, specifically the school nutrition program and the Performing Arts Center. 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 with a comparison of the School System's budget for the year. 5 MANAGEMENT'S DISCUSSION AND ANALYSIS _____________________________________________________________________________ Figure A-1 shows how the various parts of this annual report are arranged and related to one another. Figure A-1 Organization of Clayton County Board of Education's Annual Financial Report Management's Discussion and Analysis Government-wide Financial Statements Summary Basic Financial Statements Fund Financial Statements Required Supplementary Information Notes to the Financial Statements Detail Figure A-2 summarizes the major features of the School System's financial statements, including the portion of the School System's activities they cover and the types of information they contain. Figure A-2 Major Features of the Board of Education's Financial Statements Scope Required financial statements Accounting Basis and measurement focus Types of asset/liability information Type of inflow/outflow information Government-wide Statements Entire School System (except fiduciary funds) - Statement of net position - Statement of activities Governmental Funds The activities of the School System that are not proprietary or fiduciary, such as instruction, school administration, and building maintenance - Balance sheet - Statement of revenues, expenditures, and changes in fund balance Accrual accounting and economic resources focus All assets and liabilities, both financial and capital, short-term and long-term All revenues and expenses during year, regardless of when cash is received or paid 6 Modified accrual accounting and current financial focus Generally assets expected to be used up and liabilities that come due during the year or soon thereafter; no capital assets or longterm liabilities included Revenues for which cash is received during or soon after the end of the year; expenditures when goods or services have been received and the related liability is due and payable Proprietary Funds Activities the School System operates similar to private business: food services - Statement of net position - Statement of revenues, expenses, and changes in fund net position - Statement of cash flows Accrual accounting and economic resources focus All assets and liabilities, both financial and capital, and short-term and long-term All revenues and expenses during the year, regardless of when cash is received or paid MANAGEMENT'S DISCUSSION AND ANALYSIS _____________________________________________________________________________ The remainder of this overview section of management's discussion and analysis highlights the structure and contents of each of the statements. Government-wide Statements The government-wide statements report information about the School System as a whole using accounting methods similar to those used by private-sector companies. The statement of net position includes all of the School System's assets and liabilities. All of the current year's revenues and expenses are accounted for in the statement of activities regardless of when cash is received or paid. The two government-wide statements report the School System's net position and how it has changed. Net position, the difference between the School System's assets and liabilities, is one way to measure the School System's financial health or position. Over time, increases or decreases in the School System's net position are an indication of whether its financial health is improving or deteriorating, respectively. To assess the overall health of the School System, additional non-financial factors, such as changes in the property tax base, community support for education and student achievement should be considered. The government-wide financial statements of the School System are divided into two categories: Governmental activities All of the School System's basic services are included here, such as instruction and instructional support, administration, student transportation and maintenance and operation of facilities. Business type activities The School System operates a food service operation and charges fees to staff, students and visitors to help cover the cost of the food service operation. The School System also operates a performing arts center that is accounted for as a business-type activity. Fund Financial Statements The School System's fund financial statements, which begin on page 18, provide detailed information about the most significant funds, not the School System as a whole. Governmental funds Most of the School System's activities are reported in governmental funds, which focus on the determination of financial position and changes in financial position, not on income determination. They are reported using an accounting method called modified accrual 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 System's operations and the services it provides. Governmental fund information helps the reader determine whether there are more or fewer financial resources that can be spent in the near future to finance the School System's programs. The relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds is reconciled in the financial statements. 7 MANAGEMENT'S DISCUSSION AND ANALYSIS _____________________________________________________________________________ Proprietary funds Services for which the School System charges a fee are generally reported in proprietary funds. Proprietary funds are reported in the same way as the government-wide statements. The School System's enterprise fund (one type of proprietary fund) is the same as its business-type activities but provides more detail and additional information, such as cash flows. The School System uses internal service funds (the other kind of proprietary fund) to report activities that provide supplies and services for its other programs and activities. As of June 30, 2011, the School System's only internal service fund for the employee dental benefit program was closed. Financial Analysis of the School System as a Whole Table A-1, below, provides a summary of the School System's net position for the year ended June 30, 2018 compared to June 30, 2017. Table A-1 Condensed Summary of Net Position (in millions of dollars) Governmental Activities 2018 2017 Business-type Activities 2018 2017 Total 2018 2017 Percentage Change 2018-2017 Current and other Assets Net capital assets $ 158.8 756.8 Total Assets 915.6 $ 162.7 732.9 895.6 $ 15.1 4.1 19.2 $ 14.3 4.4 18.7 $ 173.9 760.9 934.8 $ 177.0 737.3 914.3 -1.8% 3.2% 2.2% Deferred outflows 111.5 110.3 3.0 1.0 114.5 111.3 2.9% Current and other liabilities 73.4 62.5 2.7 Long-term liabilities 794.6 443.5 32.9 Total Liabilities 868.0 506.0 35.6 2.9 76.1 65.4 16.4% 4.0 827.5 447.5 84.9% 6.9 903.6 512.9 76.2% Deferred inflows 45.1 8.6 2.9 0.1 48.0 8.7 451.7% Net Position Net investment in Capital Assets 756.8 732.9 4.1 4.3 Restricted for Capital Projects 52.7 51.3 - - Unrestricted (695.5) (292.9) (20.4) 8.4 Total net position $ 114.0 $ 491.3 $ (16.3) $ 12.7 760.9 52.7 (715.9) $ 97.7 737.2 51.3 (284.5) $ 504.0 3.2% 2.7% 151.6% -80.6% Note: The amounts above do not include consideration of the prior period restatement for GASB Statement No. 75, Accounting and Financial Reporting for Post-employment Benefits Other Than Pensions. 8 MANAGEMENT'S DISCUSSION AND ANALYSIS _____________________________________________________________________________ The School System's combined net position decreased by 80.6% to $97.8 million. The net position of the School System's business-type activities decreased $29 million or 228%. These decreases were due primarily to the implementation of GASB 75. The School System reported a restricted net position amount of $52.7 million. This is an increase of 2.7% from the restricted amount reported as of June 30, 2017. The change is due to a temporary increase in cash reserves as projects begin under the most recently authorized Special Purpose Local Option Sales Tax ("SPLOST"). The amount set aside as restricted in the governmental activities is related to net position required by a third-party or state law to be spent for a specific purpose. Table A-2 takes the information from the Statement of Activities and presents it in a format that shows total revenues first and then expenses and the resulting increase in net position. Table A-2 shows that revenues from governmental activities for 2018 were $556.8 million, while total expenses were $562.4 million. Governmental activities contributed $5.6 million negatively to the total net position, while business-type activities resulted in a $.1 million positive contribution. For governmental activities, program revenues, in the form of charges for services, operating grants and contributions and capital grants and contributions increased $22.9 million. This increase was primarily the result of an increase in state and federal grants received for instructional programs. Property taxes comprise the largest percentage of the general revenues for the School System with 20.7% of total revenues for governmental activities coming from this source. The increase of 10.8% from the previous year is due in part to a slight increase in the value of the tax digest. Sales tax revenues generated by the SPLOST increased $4.7 million to a total of $58.6 million. Interest and investment earnings remained minimal, reflecting the low interest being paid on account balances. 9 MANAGEMENT'S DISCUSSION AND ANALYSIS _____________________________________________________________________________ Revenues: Program revenues: Charges for services Operating grants and contributions Capital grants and contributions General revenues: Property taxes Sales taxes Other taxes Table A-2 Changes in Net Position from Operating Results (in millions of dollars) Governmental Business-type Activities Activities 2018 2017 2018 2017 Total 2018 2017 Percentage Change 2018-2017 $ 15.2 312.9 0.7 $ 14.8 290.5 0.6 115.4 58.6 10.1 104.2 53.9 8.8 $ 0.4 $ 0.4 37.9 39.6 - - $ 15.6 350.8 0.7 $ 15.2 330.1 0.6 - - 115.4 104.2 - - 58.6 53.9 - - 10.1 8.8 2.6% 6.3% 16.7% 10.7% 8.7% 14.8% Non-program specific state and federal aid Interest and investment earnings Gain on Sale of Capital Assets Total Revenues 43.7 0.1 0.1 556.8 37.3 0.1 0.3 510.5 38.3 40.0 43.7 0.1 - 595.1 37.3 0.1 0.3 550.5 17.2% 0.0% 8.1% Expenses: Instruction Pupil Services Instructional services Educational media services General administration School administration Business services Maintenance and operations Student transportation Central support services Other support services Other non-instructional services Community services Performing Arts Center Interest Food services Total Expenses Excess (deficiency) in net position 386.1 22.6 21.8 6.7 7.1 31.4 5.6 39.5 24.6 10.6 3.6 1.2 1.6 - 562.4 355.5 20.6 24.4 6.3 13.2 28.9 3.7 37.2 22.3 11.0 4.0 1.3 1.6 - 530.0 $ (5.6) $ (19.5) 0.3 37.9 38.2 0.3 38.4 38.7 $ 0.1 $ 1.3 386.1 22.6 21.8 6.7 7.1 31.4 5.6 39.5 24.6 10.6 3.6 1.2 1.6 0.3 37.9 600.6 355.5 20.6 24.4 6.3 13.2 28.9 3.7 37.2 22.3 11.0 4.0 1.3 1.6 0.3 38.4 568.7 $ (5.5) $ (18.2) 8.6% 9.7% -10.7% 6.3% -46.2% 8.7% 51.4% 6.2% 10.3% -3.6% -10.0% -7.7% 0.0% 0.0% -1.3% 5.6% -69.8% Note: The amounts above do not include consideration of the prior period restatement for GASB Statement No. 75, Accounting and Financial Reporting for Post-employment Benefits Other Than Pensions. 10 MANAGEMENT'S DISCUSSION AND ANALYSIS _____________________________________________________________________________ Table A-3 summarizes the cost of the School System's activities into eight functional categories Instruction; Pupil, Instructional and Media services; General and Business Administration; School Administration; Maintenance and operations; Pupil transportation; Central support and other support; and Community Services and non-instructional. The table also shows each activity's net cost (total cost less fees generated by the activities and intergovernmental aid provided for specific programs). The net cost shows the financial burden placed on the School System's local taxpayers by each of these functions. Table A-3 Net Cost of Governmental Activities (in millions of dollars) Total Cost of Services 2018 2017 Percentage Change 2018-2017 Net Cost of Services 2018 2017 Percentage Change 2018-2017 Instruction $ 386.1 Pupil, Instructional and Media Services 51.1 General and Business Administration 12.7 School administration 31.4 Maintenance and operations 39.5 Student transportation 24.6 Central Support and other support 14.2 Community Services and non-instructional 2.8 Total Governmental Activities $ 562.4 $ 355.5 51.3 16.9 28.9 37.2 22.3 15.0 2.9 $ 530.0 8.6% -0.4% -24.9% 8.7% 6.2% 10.3% -5.3% -3.4% 6.1% $ 119.8 33.5 7.8 19.0 24.7 21.7 12.2 (5.0) $ 233.7 $ 112.7 30.8 13.1 17.4 22.4 19.0 13.1 (4.5) $ 224.0 6.3% 8.8% -40.5% 9.2% 10.3% 14.2% -6.9% 11.1% 4.3% Less: Unrestricted federal and state aid: Total needs from local taxes and other revenues: 43.7 37.3 $ 190.0 $ 186.7 17.2% 1.8% The total cost of governmental activities increased 6.1%, and the net cost of services increased 4.3% reflecting the increase in targeted initiatives to improve instructional achievement. Business Type Activities Revenues for the School System's business-type activities (school nutrition and performing arts center) were comprised of charges for services, federal and state reimbursements and investment earnings. (See Table A-2). Business type revenues exceeded expenses during the year for an increase of $.1 million in net position. Charges for services represent $.4 million of revenue. This represents amounts paid by teachers and other customers of the cafeteria operations and the performing arts center. Federal and state reimbursement for meals, including payments for free and reduced lunches, was $37.9 million. The Statement of Revenues, Expenses and Changes in Fund Net Position for these proprietary funds will further detail the actual results of operations. 11 MANAGEMENT'S DISCUSSION AND ANALYSIS _____________________________________________________________________________ Analysis of the School System's Funds At June 30, 2018, the School System's governmental funds reported a combined fund balance of $80.1 million. This is a decrease of $18.1 million. The fund balance of the General Fund was $23.1 million at June 30, 2018. The Capital Projects ending fund balance was $52.7 million while all other Governmental Funds had a total fund balance of $4.4 million at June 30, 2018. The increase in the Capital Projects Funds is the result of a temporary increase in cash reserves as projects begin under the most recently authorized SPLOST. General Fund Budgeting Highlights The School System's budget is prepared according to Georgia state law. The most significant budgeted fund is the General Operating Fund. In accordance with GAAP, the School System amended its General Fund to reflect funding changes. The total expenditures increased $3.0 million. This was due to focused attention to instruction and pupil services, increasing general administration to address achievement objectives, and targeted initiatives, offset by attrition, conservative spending and efficient use of resources. The total revenue had a positive variance of $14.1 million. There was $12.7 million in increase in local funds and a $1.4 million increase state funds. 12 MANAGEMENT'S DISCUSSION AND ANALYSIS _____________________________________________________________________________ Capital Asset and Debt Administration Capital Assets At June 30, 2018, the School System had $760.9 million invested in a broad range of capital assets, including land, buildings and furniture and equipment for its governmental activities. The School System is currently funding a fiveyear capital improvement program with revenue from a one-cent local option sales tax that was approved by the citizens of Clayton County in November, 2013. The maximum amount of collections approved by this referendum was $280.3 million. The sales tax revenue, along with state capital outlay grants will fund the program through 2019. Table A-4 Capital Assets (net of depreciation) (in millions of dollars) Governmental Business-type Activities Activities 2018 2017 2018 2017 Total 2018 2017 Percentage Change 2018-2017 Land $ 34.6 $ 33.6 - - 34.6 33.6 Construction in progress 97.4 59.2 - - 97.4 59.2 Buildings and improvements 609.7 626.1 3.1 3.4 612.8 629.5 Machinery and equipment 15.1 14.0 1.0 1.0 16.1 15.0 Total capital assets net of depreciation $ 756.8 $ 732.9 $ 4.1 $ 4.4 $ 760.9 $ 737.3 3.0% 64.5% -2.7% 7.3% 3.2% More detailed information about capital assets can be found in Note 7 of the Notes to the Basic Financial Statements. Debt Administration At June 30, 2018, the School System had no outstanding long-term bond debt. Because of the availability of the one cent sales tax for capital improvements since 1997, the School System has not had the need to issue any new debt and used proceeds from the sales tax to retire all of the previously existing long-term bond debt. 13 MANAGEMENT'S DISCUSSION AND ANALYSIS _____________________________________________________________________________ Economic Factors FY 2015 marked a turning point that will hopefully continue in the recovery of the local economy from the recession. Property value is rebounding slowly. Further, a reduction in the austerity cuts to the "Quality Basic Education" Act funding continued for FY 2018. The percentage of students that qualify for free or reduced priced lunches exceeds approximately 80% district-wide. As a result, all schools in the district are eligible to receive Title I federal funding under the No Child Left Behind Act for the Economically Disadvantaged. Contacting the School System's Financial Management This financial report is designed to provide the School System's citizens, taxpayers, customers, and investors and creditors with a general overview of the School System's finances and to demonstrate the School System's accountability for the money it receives. If you have questions about this report or need additional financial information, please contact the Business Services Division, Clayton County Public Schools, 1058 Fifth Avenue, Jonesboro, Georgia 30236. 14 Basic Financial Statements Clayton County Public Schools CLAYTON COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION JUNE 30, 2018 ASSETS Cash and cash equivalents Investments Receivables: Accounts Intergovernmental Taxes Internal balances Inventories Prepaid items Capital assets, nondepreciable Capital assets, depreciable (net of accumulated depreciation) Total assets Governmental Activities Business-type Activities Total $ 93,497,563 $ 13,972,722 $ 107,470,285 1,405,718 - 1,405,718 99,913 50,721,435 13,209,717 (321,227) - 147,239 132,048,448 624,809,931 915,618,737 105,689 321,227 733,052 4,090,037 19,222,727 99,913 50,827,124 13,209,717 733,052 147,239 132,048,448 628,899,968 934,841,464 DEFERRED OUTFLOWS OF RESOURCES Pensions Other post-employment benefits Total deferred outflows of resources 83,111,775 28,358,172 111,469,947 743,446 2,214,415 2,957,861 83,855,221 30,572,587 114,427,808 Accounts payable Contracts payable Retainage payable LIABILITIES Accrued payroll and payroll withholdings Unearned revenue Other current liabilities Claims payable due within one year Claims payable due in more than one year Capital leases due in more than one year Compensated absences due within one year Compensated absences due in more than one year Net pension liability, due in more than one year Net other post-employment benefit liability, due in more than one year Total liabilities 3,045,259 7,674,976 2,498,306 60,192,960 1,435 11,448 2,899,939 1,042,502 1,673,150 2,609,000 413,591,838 372,752,236 867,993,049 72,857 - 2,514,860 92,097 53,132 48,522 3,700,100 29,107,242 35,588,810 3,118,116 7,674,976 2,498,306 62,707,820 93,532 11,448 2,899,939 1,042,502 1,726,282 2,657,522 417,291,938 401,859,478 903,581,859 DEFERRED INFLOWS OF RESOURCES Pensions Other post-employment benefits Total deferred inflows of resources 9,197,503 35,892,682 45,090,185 82,162 2,802,765 2,884,927 9,279,665 38,695,447 47,975,112 NET POSITION Investment in capital assets Restricted for student programs Restricted for capital projects Unrestricted (deficit) Total net position (deficit) 756,858,379 - 52,679,247 (695,532,176) $ 114,005,450 $ 4,090,037 - (20,383,186) (16,293,149) 760,948,416 - 52,679,247 (715,915,362) $ 97,712,301 The accompanying notes are an integral part of these financial statements. 15 CLAYTON COUNTY BOARD OF EDUCATION STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED JUNE 30, 2018 Functions/Programs Governmental activities: Instruction Pupil services Improvement of instructional services Educational media services General administration School administration Business services Maintenance and operations Student transportation Central support services Other support services Other non-instructional services Community services Total governmental activities Expenses Charges for Services Program Revenues Operating Grants and Contributions Capital Grants and Contributions $ 386,064,644 $ 22,609,005 7,492,405 - $ 258,004,732 $ 7,175,354 712,532 - 21,769,582 6,688,537 7,102,414 31,429,970 5,646,571 39,565,111 24,613,821 10,572,138 3,591,846 1,206,941 1,599,636 562,460,216 122,842 - 46,059 6,000,758 1,560,438 15,222,502 4,046,906 6,250,261 3,248,943 12,413,896 1,776,952 14,849,005 2,873,043 1,834,161 121,145 253,064 312,847,462 712,532 Business-type activities: School food service Performing arts center Total business-type activities Total 37,943,474 327,201 38,270,675 $ 600,730,891 $ 268,864 137,025 405,889 15,628,391 37,933,069 - 37,933,069 $ 350,780,531 $ 712,532 General revenues: Property taxes Sales taxes Other taxes Grants and contributions not restricted to specific programs Unrestricted investment earnings Gain on sale of capital assets Transfers Total general revenues Change in net position Net position (deficit), beginning of year, as restated Net position (deficit), end of year The accompanying notes are an integral part of these financial statements. 16 Net (Expenses) Revenues and Changes in Net Position Governmental Business-type Activities Activities Total $ (119,854,975) $ (15,433,651) - $ (119,854,975) - (15,433,651) (17,599,834) (438,276) (3,853,471) (19,016,074) (3,869,619) (24,716,106) (21,740,778) (8,737,977) (3,424,642) 5,046,881 (39,198) (233,677,720) - (17,599,834) - (438,276) - (3,853,471) - (19,016,074) - (3,869,619) - (24,716,106) - (21,740,778) - (8,737,977) - (3,424,642) - 5,046,881 - (39,198) - (233,677,720) (233,677,720) 258,459 (190,176) 68,283 68,283 258,459 (190,176) 68,283 (233,609,437) 115,417,127 58,626,357 10,134,638 43,722,231 100,189 56,818 6,870 115,417,127 58,626,357 10,134,638 43,722,231 100,189 63,688 228,057,360 6,870 228,064,230 (5,620,360) 75,153 (5,545,207) 119,625,810 (16,368,302) 103,257,508 $ 114,005,450 $ (16,293,149) $ 97,712,301 17 CLAYTON COUNTY BOARD OF EDUCATION BALANCE SHEET GOVERNMENTAL FUNDS JUNE 30, 2018 ASSETS General Capital Projects Nonmajor Governmental Funds Total Governmental Funds Cash Investments Receivables: Accounts Taxes Intergovernmental Due from other funds Prepaid items $ 33,079,698 $ 56,593,971 $ 207,133 1,198,585 39,295 8,138,362 40,807,779 6,358,854 147,239 5,071,355 - 3,823,894 $ - 60,618 - 9,913,656 1,142,438 - 93,497,563 1,405,718 99,913 13,209,717 50,721,435 7,501,292 147,239 Total assets $ 88,778,360 $ 62,863,911 $ 14,940,606 $ 166,582,877 LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCES LIABILITIES Accounts payable Contracts payable Retainage payable Due to other funds Accrued payroll and payroll withholdings Unearned revenue Other current liabilities $ 1,093,238 $ - - 1,463,665 57,918,008 - - - $ 7,674,976 2,498,306 4 11,378 1,952,021 $ - 6,358,850 2,274,952 1,435 70 3,045,259 7,674,976 2,498,306 7,822,519 60,192,960 1,435 11,448 Total liabilities 60,474,911 10,184,664 10,587,328 81,246,903 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes 5,203,377 - - 5,203,377 Total deferred inflows of resources 5,203,377 - - 5,203,377 FUND BALANCES Fund balances: Nonspendable - prepaid items Restricted for capital projects Restricted for student programs Committed for student programs Unassigned 147,239 - 22,952,833 52,679,247 - 4,353,278 - 147,239 52,679,247 4,353,278 22,952,833 Total fund balances 23,100,072 52,679,247 4,353,278 80,132,597 Total liabilities, deferred inflows of resources and fund balances $ 88,778,360 $ 62,863,911 $ 14,940,606 $ 166,582,877 The accompanying notes are an integral part of these financial statements. 18 CLAYTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET POSITION JUNE 30, 2018 Amounts reported for governmental activities in the statement of net position are different because: Fund balances - total governmental funds Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds. Other long-term assets are not available to pay for current period expenditures and, therefore, are deferred in the funds. Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the funds. Net position of governmental activities The accompanying notes are an integral part of these financial statements. $ 80,132,597 756,858,379 5,203,377 (728,188,903) $ 114,005,450 19 CLAYTON COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 REVENUES Local sources State sources Federal sources Interest income Total revenues EXPENDITURES Current: Instruction Pupil services Improvement of instructional services Educational media services General administration School administration Business services Maintenance and operations Student transportation Central support services Other support services On behalf payments Other non-instructional services Community service Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Sale of capital assets Transfers in Transfers out Total other financing sources (uses) Net change in fund balances FUND BALANCES, beginning of year FUND BALANCES, end of year General Capital Projects Nonmajor Governmental Funds Total Governmental Funds $ 132,799,869 $ 311,283,092 669,212 10,395 444,762,568 58,626,357 $ 712,532 89,794 59,428,683 9,452,713 7,627,078 36,607,986 53,687,777 $ 200,878,939 319,622,702 37,277,198 100,189 557,879,028 307,589,560 16,377,166 18,381,103 6,560,431 5,483,419 29,465,154 3,741,693 38,651,167 22,605,065 9,908,575 3,469,960 339,383 - 462,572,676 58,025,878 58,025,878 41,708,046 5,833,734 2,993,105 1,330,987 1,068,744 38,831 112,008 706,299 1,600,553 - 55,392,307 349,297,606 22,210,900 21,374,208 6,560,431 6,814,406 30,533,898 3,741,693 38,651,167 22,643,896 9,908,575 3,581,968 1,045,682 1,600,553 58,025,878 575,990,861 (17,810,108) 1,402,805 (1,704,530) (18,111,833) 56,818 - (1,164,032) (1,107,214) (18,917,322) 42,017,394 $ 23,100,072 $ - 1,402,805 51,276,442 52,679,247 $ 1,164,032 1,164,032 56,818 1,164,032 (1,164,032) 56,818 (540,498) (18,055,015) 4,893,776 98,187,612 4,353,278 $ 80,132,597 The accompanying notes are an integral part of these financial statements. 20 CLAYTON COUNTY BOARD OF EDUCATION RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED JUNE 30, 2018 Amounts reported for governmental activities in the statement of activities are different because: Net change in fund balances - total governmental funds Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period. Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. Change in net position - governmental activities The accompanying notes are an integral part of these financial statements. $ (18,055,015) 23,905,717 (1,152,529) (10,318,533) $ (5,620,360) 21 CLAYTON COUNTY BOARD OF EDUCATION GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET (NON-GAAP) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 2018 REVENUES Local sources State sources Federal sources Interest income Total revenues EXPENDITURES Current: Instruction Pupil services Improvement of instructional services Educational media services General administration School administration Business services Maintenance and operations Student transportation Central support services Other support services Other non-instructional services Total expenditures Deficiency of revenues over expenditures OTHER FINANCING SOURCES (USES) Sale of capital assets Transfers out Total other financing sources (uses) Net change in fund balances Budget Original Final $ 119,100,365 $ 120,076,021 $ 301,974,995 303,726,092 687,700 754,211 30,000 30,000 421,793,060 424,586,324 Actual Variance With Final Budget 132,799,869 $ 305,170,269 669,212 10,395 438,649,745 12,723,848 1,444,177 (84,999) (19,605) 14,063,421 299,594,743 15,499,671 20,031,501 7,119,841 5,221,874 30,362,766 7,113,153 35,318,817 22,501,128 13,453,363 77,804 - 456,294,661 292,107,767 15,898,556 20,577,353 6,717,739 5,363,362 29,595,735 15,459,697 36,569,523 20,725,555 12,691,968 2,890,621 678,255 459,276,131 303,497,787 16,377,166 18,381,103 6,560,431 5,316,189 29,465,154 3,715,467 38,341,361 22,366,304 9,825,140 3,232,488 339,383 457,417,973 (11,390,020) (478,610) 2,196,250 157,308 47,173 130,581 11,744,230 (1,771,838) (1,640,749) 2,866,828 (341,867) 338,872 1,858,158 (34,501,601) (34,689,807) (18,768,228) 15,921,579 - - 56,818 (230,266) (230,266) (230,266) (230,266) (1,164,032) (1,107,214) $ (34,731,867) $ (34,920,073) $ (19,875,442) $ 56,818 (933,766) (876,948) 15,044,631 The accompanying notes are an integral part of these financial statements. 22 CLAYTON COUNTY BOARD OF EDUCATION STATEMENT OF NET POSITION PROPRIETARY FUNDS JUNE 30, 2018 CURRENT ASSETS Cash and cash equivalents Receivables: Intergovernmental Inventories Due from other funds ASSETS Total current assets CAPITAL ASSETS Buildings Furniture and equipment Intangibles Total depreciable assets Less accumulated depreciation and amortization Total capital assets Total assets DEFERRED OUTFLOWS OF RESOURCES Pensions Other post-employment benefits Total deferred outflows of resources LIABILITIES CURRENT LIABILITIES Accounts payable Accrued payroll and payroll withholdings Compensated absences Unearned revenue Total current liabilities NON-CURRENT LIABILITIES Compensated absences Net pension liability Net other post-employment benefit liability Total non-current liabilities Total liabilities DEFERRED INFLOWS OF RESOURCES Pensions Other post-employment benefits Total deferred inflows of resources NET POSITION Investment in capital assets Unrestricted Business-type Activities - Enterprise Funds Nonmajor School Performing Food Arts Service Center Totals $ 13,972,722 $ - $ 13,972,722 105,689 733,052 98,070 14,909,533 223,157 223,157 105,689 733,052 321,227 15,132,690 5,365,614 53,643 5,419,257 (4,471,824) 947,433 15,856,966 7,308,375 6,167 - 7,314,542 (4,171,938) 3,142,604 3,365,761 7,308,375 5,371,781 53,643 12,733,799 (8,643,762) 4,090,037 19,222,727 743,446 2,214,415 2,957,861 - 743,446 - 2,214,415 - 2,957,861 71,679 2,514,860 53,132 92,097 2,731,768 48,522 3,700,100 29,107,242 32,855,864 35,587,632 82,162 2,802,765 2,884,927 947,433 (20,605,165) 1,178 - 1,178 1,178 - 3,142,604 221,979 72,857 2,514,860 53,132 92,097 2,732,946 48,522 3,700,100 29,107,242 32,855,864 35,588,810 82,162 2,802,765 2,884,927 4,090,037 (20,383,186) Total net position (deficit) $ (19,657,732) $ The accompanying notes are an integral part of these financial statements. 23 3,364,583 $ (16,293,149) CLAYTON COUNTY BOARD OF EDUCATION STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION PROPRIETARY FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 OPERATING REVENUES Local sources Total operating revenues OPERATING EXPENSES Food service operations Enterprise operation Maintenance and operations Depreciation Total operating expenses Operating loss NON-OPERATING REVENUES Intergovernmental revenues Gain on sale of capital assets Total non-operating revenues Change in net position NET POSITION (DEFICIT), beginning of year, as restated NET POSITION (DEFICIT), end of year Business-type Activities - Enterprise Funds Nonmajor School Performing Food Arts Service Center Totals $ 268,864 $ 137,025 $ 405,889 268,864 137,025 405,889 37,220,553 - 540,474 182,447 37,943,474 (37,674,610) 181,032 146,169 327,201 (190,176) 37,220,553 181,032 540,474 328,616 38,270,675 (37,864,786) 37,933,069 6,870 37,939,939 265,329 (19,923,061) $ (19,657,732) $ - 37,933,069 - 6,870 - 37,939,939 (190,176) 75,153 3,554,759 (16,368,302) 3,364,583 $ (16,293,149) The accompanying notes are an integral part of these financial statements. 24 CLAYTON COUNTY BOARD OF EDUCATION STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 CASH FLOWS FROM OPERATING ACTIVITIES Receipts from local sources Payments to suppliers Payments to employees Payments on behalf of employees Net cash used in operating activities CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Subsidy from federal and state grants Net cash provided by noncapital financing activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Purchase of capital assets Proceeds from disposition of capital assets Net cash used in capital and related financing activities Net increase in cash and cash equivalents Cash and cash equivalents, beginning of year Cash and cash equivalents, end of year (Continued) Business-type Activities - Enterprise Funds Nonmajor School Performing Food Arts Service Center Totals $ 185,563 $ (20,452,891) (11,317,640) (5,603,774) (37,188,742) 180,566 $ 366,129 (40,605) (20,493,496) (119,802) (11,437,442) (20,159) (5,623,933) - (37,188,742) 38,327,223 - 38,327,223 38,327,223 - 38,327,223 (107,091) 6,870 (100,221) 1,038,260 12,934,462 $ 13,972,722 $ - (107,091) - 6,870 - (100,221) - 1,038,260 - 12,934,462 - $ 13,972,722 25 CLAYTON COUNTY BOARD OF EDUCATION STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 Reconciliation of operating loss to net cash used in operating activities Operating loss Adjustments to reconcile operating loss to net cash used in operating activities Depreciation Decrease in accounts receivable (Increase) decrease in due from other funds Increase in inventories Decrease in deferred outflows - pensions Increase in deferred outflows - OPEB Increase (decrease) in accounts payable Decrease in accrued payroll and other withholdings Decrease in compensated absences Increase in deferred inflows - pensions Increase in deferred inflows - OPEB Decrease in net pension liability Increase in net OPEB liability Decrease in unearned revenue Net cash used in operating activities Business-type Activities - Enterprise Funds Nonmajor School Performing Food Arts Service Center Totals $ (37,674,610) $ (190,176) $ (37,864,786) 182,447 4,207 (79,862) (135,738) 242,890 (1,134,216) (155,046) 28,991 (30,379) 5,563 2,802,765 (240,687) (997,421) (7,646) $ (37,188,742) $ 146,169 - 43,541 - 466 328,616 4,207 (36,321) (135,738) 242,890 (1,134,216) (154,580) - 28,991 (30,379) - 5,563 - 2,802,765 - (240,687) - (997,421) - (7,646) - $ (37,188,742) NONCASH INVESTING, CAPITAL AND FINANCING ACTIVITIES The School System received $2,605,839 in commodities from the United States Department of Agriculture during the fiscal year ended June 30, 2018. The accompanying notes are an integral part of these financial statements. 26 CLAYTON COUNTY BOARD OF EDUCATION STATEMENT OF FIDUCIARY ASSETS AND LIABILITIES AGENCY FUND JUNE 30, 2018 ASSETS Cash Total assets Due to others Total liabilities LIABILITIES The accompanying notes are an integral part of these financial statements. Agency Fund Student Activities $ 550,018 $ 550,018 $ 550,018 $ 550,018 27 Notes to Financial Statements Clayton County Public Schools CLAYTON COUNTY BOARD OF EDUCATION NOTES TO FINANCIAL STATEMENTS JUNE 30, 2018 NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. Reporting Entity The Clayton County Board of Education (the "School System") operates under a Board/Superintendent form of government. The nine-member Board is elected by the public and the Board appoints the superintendent. These nine elected members have decision making authority, the power to designate management, and the ability to significantly influence operations. The Board determines the millage rate at which school taxes are levied and may incur bonded indebtedness with voter approval. B. Government-wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the non-fiduciary activities of the School System. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for services. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include: 1) charges to those who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment, and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. C. Measurement Focus, Basis of Accounting and Basis of Presentation The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of the related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. 28 NOTES TO FINANCIAL STATEMENTS NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) C. Measurement Focus, Basis of Accounting and Basis of Presentation (Continued) Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period. For this purpose, the School System considers revenues to be available if they are collected within 60 days of the end of the current fiscal period, except for amounts related to reimbursement based grants, which are considered available when all eligibility criteria has been met. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. The fiduciary fund financial statements are reported using the accrual basis of accounting. Property taxes, sales taxes, intergovernmental grants, and investment income associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Revenue from grants and donations is recognized in the year in which all eligibility requirements have been satisfied. Eligibility requirements include timing requirements, which specify the year when the resources are required to be used or the year when use is first permitted; matching requirements, in which the School System must provide local resources to be used for a specified purpose; and expenditure requirements, in which the resources are provided to the School System on a reimbursement basis. The State of Georgia reimburses the School System for teachers' salaries and operating costs through the Quality Basic Education ("QBE") Formula Earnings program. State of Georgia law defines the formula driven grant that determines the cost of an academic school year and the State of Georgia's share in this cost. Generally, teachers are contracted for the school year (July 1 June 30) and paid over a 12-month contract period, generally, September 1 through August 31. In accordance with the requirements of the enabling legislation of the QBE program, the State of Georgia reimburses the School System over the same 12-month period in which teachers are paid, funding the academic school year expenditures. 29 NOTES TO FINANCIAL STATEMENTS NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) C. Measurement Focus, Basis of Accounting and Basis of Presentation (Continued) At June 30, the amount of teachers' salaries incurred but not paid until July and August of the subsequent year is accrued, as the State of Georgia has only postponed the final payment of their share of the cost until the subsequent appropriations for cash management purposes. By June 30 of each year, the State of Georgia has a signed appropriation that includes this final amount, which represents the State of Georgia's intent to fund this final payment. Based on guidance in Government Accounting Standards Board ("GASB") Statement No. 33, paragraph 74, the State of Georgia recognizes its QBE liability for the July and August salaries at June 30, and the School System recognizes the same QBE as a receivable and revenue, consistent with symmetrical recognition. The School System reports the following major governmental funds: The General Fund is the School System's primary operating fund. It accounts for all financial resources of the School System, except those required to be accounted for in another fund. The Capital Projects Fund accounts for the proceeds of a 1% Special Purpose Local Option Sales Tax ("SPLOST") as well as revenues from local and state sources to be used for land and building acquisitions and construction and renovations of new educational and administrative facilities. The School System reports the following major proprietary fund: The School Food Service Fund accounts for the monies and commodities received from the federal and state governments and the School Food Service's cafeteria sales for the purpose of maintaining the School System's breakfast, lunch, and snack programs. Additionally, the School System reports the following fund types: The Special Revenue Funds account for federal and state funded programs. These grants are awarded to the School System for the purpose of accomplishing specific educational tasks as defined in the grant agreements. These funds also contain several locally funded programs whose expenditures are limited to specific purposes. School Activity Funds are also reported as special revenue funds. The School Activity Funds are used to account for funds collected primarily through the fund raising efforts of the individual school. Each school's principal is responsible, under the authority of the Board, for collecting, controlling, disbursing, and accounting for his or her school's funds. All resources of the fund, including earnings on invested resources, may be used to support the schools' activities. The Agency Fund is used to account for student club and class accounts. 30 NOTES TO FINANCIAL STATEMENTS NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) C. Measurement Focus, Basis of Accounting and Basis of Presentation (Continued) As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this general rule are charges between the School System's school food service program and the General Fund. Elimination of these charges would distort the direct costs reported for the various functions concerned. Amounts reported as program revenues include: 1) charges for services provided, 2) operating grants and contributions, and 3) capital grants and contributions. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes. Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the enterprise funds are charges for goods and services provided. Operating expenses of the enterprise funds include the cost of these goods and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. When both restricted and unrestricted resources are available for use, it is the School System's policy to use restricted resources first, then unrestricted resources as they are needed. D. Cash and Investments The School System's cash and cash equivalents are considered to be cash on hand, demand deposits, and short-term investments with original maturities of three months or less from the date of acquisition. E. Receivables and Payables Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year as well as all other outstanding balances between funds are reported as "due to/from other funds". Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as "internal balances". 31 NOTES TO FINANCIAL STATEMENTS NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F. On-Behalf Payments The State of Georgia makes certain pension plan payments on behalf of the School System for its employees. The School System records these payments as both a revenue and expenditure in the General Fund. The total of the on-behalf payments for the fiscal year ended June 30, 2018, was $1,062,929. G. Inventories and Prepaid Items Inventories are stated at cost using the first-in, first-out method. Donated food commodities are recorded at fair value. The School System utilizes the consumption method to recognize inventory usage. Under the consumption method, inventories are recorded as expenses when used rather than when purchased. Payments made to vendors for services that will benefit periods beyond year-end are recorded as prepaid items using the consumption method by recording an asset for the prepaid amount and reflecting expenditure/expense in the year in which services are consumed. H. Non-Monetary Transactions The School System received from the United States Department of Agriculture through the Georgia Department of Education approximately $2,605,839 in donated food commodities for its lunchroom programs. The federally assigned value of these commodities is reflected as revenue and an expense in the financial statements. I. Capital Assets Capital assets, which include property, plant, and equipment, are reported in the applicable governmental or business-type activities column in the government-wide financial statements. Capital assets are defined by the School System as assets with an initial, individual cost of more than $5,000. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value at the date of donation. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend assets' lives are not capitalized. 32 NOTES TO FINANCIAL STATEMENTS NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) I. Capital Assets (Continued) Property, plant, and equipment are depreciated using the straight-line method over the following estimated useful lives: Asset Improvements Buildings Machinery and equipment Years 20 50 20 50 4 10 J. Deferred Outflows/Inflows of Resources In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. Other than the pension and the Other Post-Employment Benefit related items discussed below, the School System did not have any items that qualified for reporting in this category for the year ended June 30, 2018. In addition to liabilities, the statement of financial position and the governmental funds balance sheet will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of fund balance that applies to future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. Other than the pension and Other Post-Employment Benefit related items discussed below, the School System has only one type of item, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from property taxes, and these amounts are deferred and will be recognized as an inflow of resources in the period in which the amounts become available. K. 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 fiduciary net position of the Teachers' Retirement System of Georgia ("TRS"), the Public School Employees' Retirement System ("PSERS"), and the Employees' Retirement System ("ERS"), and additions to/deductions from each plan's fiduciary net position have been determined on the same basis as they are reported by each 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. The School System also had deferred inflows and outflows related to the recording of changes in its net pension liability. 33 NOTES TO FINANCIAL STATEMENTS NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) K. Pensions (Continued) Certain changes in the net pension liability are recognized as pension expense over time instead of all being recognized in the year of occurrence. Experience gains or losses result from periodic studies by the plan's actuary which adjust the net pension liability for actual experience for certain trend information that was previously assumed, for example the assumed dates of retirement of plan members. These experience gains or losses are recorded as deferred outflows of resources or deferred inflows of resources and are amortized into pension expense over the expected remaining service life of plan members. Changes in actuarial assumptions which adjust the net pension liability are also recorded as deferred outflows of resources or deferred inflows of resources and are amortized into pension expense over the expected remaining lives of plan members. The difference between projected investment return on pension investments and actual return on those investments is also deferred and amortized against pension expense over a five-year period. Additionally, any contributions made by the School System to the pension plan before year-end but subsequent to the measurement date of the School System's net pension liability are reported as deferred outflows of resources. L. Other Post-Employment Benefits ("OPEB") For purposes of measuring the net OPEB liability (asset), deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Georgia School Employees' Post-employment Benefit Fund ("School OPEB Fund") and additions to/deductions from the School OPEB Fund's fiduciary net position have been determined on the same basis as they are reported by the 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. M. Long-Term Obligations In the government-wide financial statements, and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net position. In the fund financial statements, governmental fund types report the face amount of debt issued as other financing sources. 34 NOTES TO FINANCIAL STATEMENTS NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) N. Compensated Absences It is the School System's policy to permit employees to accumulate unused vacation and sick pay benefits. Accumulated unpaid sick leave benefits do not vest and, therefore, are not accrued in any fund, but are recognized as expenditures or expenses when incurred. Accumulated unpaid vacation pay is accrued when incurred in the government-wide and proprietary fund financial statements. O. Fund Equity Fund equity at the governmental fund financial reporting level is classified as "fund balance". Fund equity for all other reporting is classified as "net position". Fund Balance Generally, fund balance represents the difference between current assets and current liabilities. In the fund financial statements, governmental funds report fund balance classifications that comprise a hierarchy based primarily on the extent to which the School System is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. Fund balance terms are classified as follows: Nonspendable: Fund balances that are not in spendable form (e.g., prepaid items) or are legally or contractually required to be maintained intact (e.g., permanent fund principal). Restricted: Fund balances that can be spent only for the specific purposes stipulated by external parties, either constitutionally or through enabling legislation (e.g., grants or donations). Committed: Fund balances that can be used only for the specific purposes determined by an approved resolution of the School System. Commitments may be changed or lifted only by referring to formal action that imposed the original constraint on the fund (e.g., the School System's commitment in connection with future construction projects). Assigned: Fund balances intended to be used by the School System for specific purposes. Pursuant to the fund balance policy, intent can be expressed by the School System or by a designee to whom the School System delegates authority. In governmental funds other than the General Fund, assigned fund balance represents the amount that is not restricted or committed. This indicates that resources in other governmental funds are, at minimum, intended to be used for the purpose of that fund. 35 NOTES TO FINANCIAL STATEMENTS NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) O. Fund Equity (Continued) Unassigned: Fund balances are reported as unassigned as the residual amount when the balances do not meet any of the above criteria. The School System reports positive unassigned fund balance only in the General Fund. Negative unassigned fund balances may be reported in all funds. The responsibility for designating funds to specific classifications is as follows: Committed: The Clayton County Board of Education is the School System's highest level of decision-making 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. Assigned: The School System has authorized the Superintendent and the Chief Financial Officer as officials authorized to assign fund balance to a specific purpose as approved by this fund balance policy. It is the initial goal of the School System to achieve and maintain an unassigned fund balance in the General Fund at fiscal year-end of not less than 7.5 15% of prior year general fund budgeted expenditures and not to exceed 15% of the total budget of the subsequent fiscal year, net of any committed reserve balance for capital expenditures and assigned fund balances "to cover unanticipated deficiencies in revenue or unanticipated expenditures," in compliance with the Official Code of Georgia Annotated ("O.C.G.A.") 20-2-167(a) 5. If the total of the unassigned, assigned, and committed fund balances (net of the previous allowances) at fiscal year-end falls below this goal, the School District will take action to restore the unassigned fund balance to the minimum level within two fiscal years following the fiscal year in which the event occurred. The School System will develop a plan to replenish the affected fund balance(s) and include the plan in a five-year forecast presented to the School Board during the annual budget development process. Unbudgeted Activity funds will be excluded from the calculation. 1. This amount provides adequate funding to cover approximately two months of operating expenses. 2. This amount is intended to provide the liquidity necessary to accommodate the District's uneven cash flow, which is inherent in its periodic tax collection schedule. 3. This amount is intended to provide the liquidity necessary to respond to contingent liabilities. 4. This amount may provide additional resources for other funds. 36 NOTES TO FINANCIAL STATEMENTS NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) O. Fund Equity (Continued) When multiple categories of fund balance are available for expenditures (e.g., a project is being funded partly by a grant, funds set aside by the Clayton County Board of Education, and unassigned fund balance), the School System will start with the most restricted category and spend those funds first before moving down to the next category with available funds. P. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Q. Tax Abatement Agreements During the year ended June 30, 2017, the Board of Education implemented GASB Statement No. 77, Tax Abatement Disclosures. This statement requires the School System to disclose information for any tax abatement agreements either entered into by the School System, or agreements entered into by other governments that reduce the School System's tax revenues. As of June 30, 2018, the School System did not have any such agreements, either entered into by the School System or by other governments that exceeded the quantitative threshold for disclosure. 37 NOTES TO FINANCIAL STATEMENTS NOTE 2. RECONCILIATION OF GOVERNMENT-WIDE FINANCIAL STATEMENTS AND FUND FINANCIAL STATEMENTS A. Explanation of certain differences between the governmental fund balance sheet and the government-wide statement of net position The governmental fund balance sheet includes a reconciliation between fund balance total governmental funds and net position governmental activities as reported in the government-wide statement of net position. One element of that reconciliation explains that "long-term liabilities are not due and payable in the current period and, therefore, are not reported in the funds." The details of this $728,188,903 difference are as follows: Workers' compensation claims payable Compensated absences Net pension liability Net OPEB liability Pensions and OPEB - deferred inflows of resources Pensions and OPEB - deferred outflows of resources $ (3,942,441) (4,282,150) (413,591,838) (372,752,236) (45,090,185) 111,469,947 Net adjustment to reduce fund balance - total governmental funds to arrive at net position - governmental activities $ (728,188,903) B. Explanation of certain differences between the governmental fund statement of revenues, expenditures and changes in fund balances and the government-wide statement of activities The governmental fund statement of revenues, expenditures and changes in fund balances includes a reconciliation between net changes in fund balances total governmental funds and changes in net position of governmental activities as reported in the government-wide statement of activities. One element of that reconciliation explains that "Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense." The details of this $23,905,717 difference are as follows: Capital outlay Depreciation expense Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net position of governmental activities $ 43,043,539 (19,137,822) $ 23,905,717 38 NOTES TO FINANCIAL STATEMENTS NOTE 2. RECONCILIATION OF GOVERNMENT-WIDE FINANCIAL STATEMENTS AND FUND FINANCIAL STATEMENTS (CONTINUED) B. Explanation of certain differences between the governmental fund statement of revenues, expenditures and changes in fund balances and the government-wide statement of activities (Continued) Another element of that reconciliation states that "some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds." The details of this $10,318,533 difference are as follows: Compensated absences Workers' compensation claims payable Change in net pension liability and deferred inflows and outflows related to pension activity Change in net OPEB liability and deferred inflows and outflows related to OPEB activity Net adjustment to decrease net change in fund balances - governmental funds to arrive at change in net position governmental activities $ (284,461) (612,046) (827,436) (8,594,590) $ (10,318,533) NOTE 3. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY Budgets. The School System adopts annual budgets for its general and special revenue funds, except that an annual budget is not adopted for the School Discretionary special revenue fund. The School System does not employ encumbrance accounting and, accordingly, all appropriations lapse at year-end. After the School System has tentatively adopted a budget, such budget is advertised at least one time in a local newspaper of general circulation. At the next regular meeting of the Board members after the advertisement, the budget is revised as necessary and adopted as the final budget. This final budget is then submitted to the Georgia Department of Education in accordance with provisions of the QBE. The level of budgetary control (the level at which expenditures may not exceed appropriations) is at the fund level. The Statement of Revenues and Expenditures Budget (Non-GAAP) to Actual presents actual and budget data for the General Fund. To facilitate comparison with the budget, adjustments have been made to actual revenues and expenditures to reflect actual amounts on the budget basis. 39 NOTES TO FINANCIAL STATEMENTS NOTE 3. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY (CONTINUED) The primary differences between the budget basis and the generally accepted accounting principles ("GAAP") in the United States of America are: a. State QBE revenue is recorded when received (budget) rather than when susceptible to accrual (GAAP). b. Salaries and employee benefits paid to teachers under contract are recorded when paid (budget) rather than when the liability is incurred (GAAP). c. Payments made by the State of Georgia for School System employee benefits are recognized as revenues and expenditures under GAAP and are not recognized on the budget basis. Adjustments necessary to convert the General Fund's net change in fund balance from the GAAP basis to the budgetary basis are as follows: GAAP basis net change in fund balance Adjustment for: State QBE revenue Salaries and employee benefits State paid employee benefit revenue State paid employee benefit expenditures Budget basis net change in fund balance $ (18,917,322) (5,049,893) 4,091,773 (1,062,930) 1,062,930 $ (19,875,442) NOTE 4. DEPOSITS AND INVESTMENTS Credit Risk. State statutes authorize the School System to invest in: obligations of the United States, the State of Georgia and other political subdivisions of the State of Georgia, and other states; prime bankers' acceptances; repurchase agreements; and the Georgia local government investment pool ("Georgia Fund 1"). 40 NOTES TO FINANCIAL STATEMENTS NOTE 4. DEPOSITS AND INVESTMENTS (CONTINUED) The local government investment pool, Georgia Fund 1, created by the O.C.G.A. 36-83-8, is a stable asset value investment pool, which follows Standard and Poor's criteria for AAAf rated money market funds and is regulated by the Georgia Office of the State Treasurer. The pool is not registered with the SEC as an investment company. The pool's primary objectives are safety of capital, investment income, liquidity and diversification while maintaining principal ($1 per share value). The asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and determines participants' shares sold and redeemed based on $1 per share. The pool also adjusts the value of its investments to fair market value as of year-end and the School System's investment in the Georgia Fund 1 is reported at fair value. The School System considers amounts held in Georgia Fund 1 as cash equivalents for financial statement presentation. The School System does not have a policy for credit risk beyond the types of investments authorized by Georgia State law. At June 30, 2018, the School System had the following investments: Investment Georgia Fund 1 Maturities 10-day weighted average Fair Value $ 1,405,718 Interest Rate Risk. The School System does not have a formal investment policy that limits investment maturities as a means of managing its exposure to fair value losses arising from increasing interest rates. Fair Value Measurements. The School System categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; and Level 3 inputs are significant unobservable inputs. The Georgia Fund 1 is an investment pool which does not meet the criteria of GASB Statement No. 79 and is thus valued at fair value in accordance with GASB Statement no. 31. As a result, the School System does not disclose investment in the Georgia Fund 1 with the fair value hierarchy. Custodial Credit Risk Deposits. Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover deposits or will not be able to recover collateral securities that are in the possession of an outside party. State statutes require all deposits and investments (other than federal and state government instruments) to be collateralized by depository insurance, obligations of the U.S. government, or bonds of public authorities, counties, or municipalities. As of June 30, 2018, the School System's bank balance was fully collateralized. 41 NOTES TO FINANCIAL STATEMENTS NOTE 5. RECEIVABLES Receivables at June 30, 2018, for the School System's individual major funds and nonmajor funds in the aggregate, including the applicable allowances for uncollectible accounts, are as follows: Intergovernmental Taxes Accounts Nonmajor School Capital Governmental Food General Projects Funds Service Total $ 40,807,779 $ - $ 9,913,656 $ 105,689 $ 50,827,124 13,341,739 5,071,355 - - 18,413,094 39,295 - 60,618 - 99,913 54,188,813 5,071,355 9,974,274 105,689 69,340,131 Less allowance for uncollectible (5,203,377) Net total receivable $ 48,985,436 $ 5,071,355 $ 9,974,274 $ - (5,203,377) 105,689 $ 64,136,754 NOTE 6. Intergovernmental receivables consist of grant reimbursements due primarily from the Georgia Department of Education, sales taxes which are collected by the state on the School System's behalf, and property taxes collected by Clayton County Tax Commissioner on the School System's behalf. PROPERTY TAXES Clayton County bills and collects property taxes for the School System. Property taxes are levied (assessed) on all taxable real, public utility and personal property (including vehicles) located within the County as of January 1st of each year. State law limits the School System's tax levy for operations to 20 mills (one mill equals $1 per thousand dollars of assessed value). Assessed values for property tax purposes are determined by the Clayton County Board of Tax Assessors for all property except public utilities and motor vehicles. Assessed value is set at 40% of market value. The State of Georgia establishes values for public utilities and motor vehicles. Real property taxes were levied on September 15, 2017 and were due November 15, 2017. Clayton County may place liens on property once the related tax payments become delinquent. The property tax receivable allowance is equal to 50% of outstanding property taxes at June 30, 2018, net of amounts collected within 60 days of year-end. Vehicle personal property taxes are due upon each respective payor's date of birth on an annual basis. 42 NOTES TO FINANCIAL STATEMENTS NOTE 7. CAPITAL ASSETS Capital asset activity for the fiscal year ended June 30, 2018, is as follows: Beginning Balance Governmental activities: Capital assets, not being depreciated: Land $ Construction in progress Total 33,647,096 59,192,155 92,839,251 Capital assets, being depreciated: Buildings Improvements Machinery and equipment Total 826,151,435 4,831,696 48,412,914 879,396,045 Less accumulated depreciation for: Buildings Improvements Machinery and equipment Total (201,937,395) (2,958,093) (34,387,146) (239,282,634) Increases $ 998,938 38,210,259 39,209,197 3,834,342 3,834,342 (16,228,373) (177,830) (2,731,619) (19,137,822) Decreases $ - - - (1,046,267) (1,046,267) 1,046,267 1,046,267 Transfers $ - - - - - Total capital assets, being depreciated, net 640,113,411 (15,303,480) - - Governmental activities capital assets, net $ 732,952,662 $ 23,905,717 $ - $ - Business-type activities: Capital assets, being depreciated: Buildings $ 7,308,375 $ - $ - $ - Machinery and equipment 5,297,696 107,091 (33,006) - Intangibles 53,643 - - - Total 12,659,714 107,091 (33,006) - Less accumulated depreciation for: Buildings (4,019,601) (146,169) - - Machinery and equipment (4,328,551) (182,447) 33,006 - Total (8,348,152) (328,616) 33,006 - Total capital assets, being depreciated, net 4,311,562 (221,525) - - Business-type activities capital assets, net $ 4,311,562 $ (221,525) $ - $ - Ending Balance $ 34,646,034 97,402,414 132,048,448 826,151,435 4,831,696 51,200,989 882,184,120 (218,165,768) (3,135,923) (36,072,498) (257,374,189) 624,809,931 $ 756,858,379 $ 7,308,375 5,371,781 53,643 12,733,799 (4,165,770) (4,477,992) (8,643,762) 4,090,037 $ 4,090,037 43 NOTES TO FINANCIAL STATEMENTS NOTE 7. CAPITAL ASSETS (CONTINUED) Depreciation expense was charged to functions/programs of the School System as follows: Governmental activities: Instruction Pupil services Improvement of instructional services Educational - media services General administration School administration Business administration Maintenance and operations Student transportation Central support services Other non-instructional services Total depreciation expense - governmental activities $ 16,424,917 3,880 54,656 851 145,340 243,052 3,114 273,862 1,695,432 131,460 161,258 $ 19,137,822 Business-type activities: School food services Performing arts center Total depreciation expense - business-type activities $ 182,447 146,169 $ 328,616 NOTE 8. SHORT-TERM DEBT The School District issued a tax anticipation note in advance of property tax collections, depositing the proceeds in its General Fund. This short-term debt is to provide cash for operations until property tax collections were received by the School District. Article IX, Section V, Paragraph V of the Constitution of the State of Georgia limits the aggregate amount of short-term debt to 75% of the total gross income from taxes collected in the preceding year and requires all short-term debt to be repaid no later than December 31 of the calendar year in which the debt was incurred. The maturity date of the loan was December 29, 2017. One draw totaling $25,000,000 was required to meet the cash flow needs of the School District. The note was repaid on December 29, 2017. Beginning Balance Additions Reductions Ending Balance Tax anticipation note $ - $ 25,000,000 $ (25,000,000) $ - 44 NOTES TO FINANCIAL STATEMENTS NOTE 9. LONG-TERM DEBT Changes in long-term debt for the year ended June 30, 2018, are as follows: Beginning Balance Additions Reductions Ending Balance Due Within One Year Governmental activities: Claims payable $ 3,330,395 $ 3,081,526 $ (2,469,480) $ 3,942,441 $ Compensated absences 3,997,689 1,835,570 (1,551,109) 4,282,150 Net pension liability 440,479,769 70,515,723 (97,403,654) 413,591,838 Net OPEB liability 385,525,362 29,445,208 (42,218,334) 372,752,236 Governmental activities Long-term liabilities $ 833,333,215 $ 104,878,027 $ (143,642,577) $ 794,568,665 $ 2,899,939 1,673,150 - 4,573,089 Business-type activities: Compensated absences $ Net pension liability Net OPEB liability Business-type activities Long-term liabilities $ 86,226 $ 3,940,787 30,104,662 34,131,675 $ 73,762 $ 630,620 2,298,224 3,002,606 $ (58,334) $ (871,307) (3,295,644) 101,654 $ 3,700,100 29,107,242 (4,225,285) $ 32,908,996 $ 53,132 - 53,132 The balance of claims payable, $3,942,441, is related to workers' compensation claims. For governmental activities, compensated absences, claims payable, net pension liability, and net OPEB liability are liquidated primarily by the General Fund. For business-type activities, compensated absences, net pension liability, and net OPEB liability are liquidated primarily by the School Food Service Fund. NOTE 10. INTERFUND RECEIVABLES, PAYABLES AND TRANSFERS The composition of interfund balances as of June 30, 2018, is as follows: Due to/from other funds: Due to General Due from Capital Projects Fund Nonmajor Governmental Funds Total General Fund $ - $ School Food Service 98,070 Nonmajor governmental funds 1,142,438 Nonmajor enterprise funds 223,157 $ 1,463,665 $ 4 6,358,850 $ 6,358,854 - - 98,070 - - 1,142,438 - - 223,157 4 6,358,850 $ 7,822,519 45 NOTES TO FINANCIAL STATEMENTS NOTE 10. INTERFUND RECEIVABLES, PAYABLES AND TRANSFERS (CONTINUED) These balances resulted from the time lag between the dates that: 1) interfund goods and services are provided or reimbursable expenditures occur, 2) transactions are recorded in the accounting system, and 3) payments between funds are made. Interfund transfers: Transfers in Nonmajor Governmental Funds Transfers out General Fund $ 1,164,032 Transfers are used to: 1) move revenues from the fund that the statute or budget requires to collect them to the fund that the statute or budget requires to expend them, and 2) use unrestricted revenues collected in the general fund to finance various programs accounted for in other funds in accordance with budgetary authorizations. NOTE 11. RETIREMENT PLANS Teachers' Retirement System Plan Description All teachers of the School System as defined in 47-3-60 of the Official Code of Georgia Annotated ("O.C.G.A.") and certain other support personnel as defined by 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. TRS issues a publicly available financial report that can be obtained at www.trsga.com/publications. 46 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Teachers' Retirement System (Continued) 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 ten 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. Pursuant to O.C.G.A. 47-3-63, the employer contributions for certain full-time public school support personnel are funded on behalf of the employer by the State of Georgia. Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Employees were required to contribute 6% of their annual pay during fiscal year 2018. The School System's contractually required contribution rate for the year ended June 30, 2018, was 16.81% of annual School System payroll. School System contributions to TRS were $46,354,010 for the year ended June 30, 2018. Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At June 30, 2018, the School System reported a liability for its proportionate share of the net pension liability that reflected a reduction for support provided to the School System by the State of Georgia for certain public school support personnel. The amount recognized by the School System as its proportionate share of the net pension liability, the related State of Georgia support, and the total portion of the net pension liability that was associated with the School System were as follows: School System's proportionate share of the net pension liability $ 417,029,779 State of Georgia's proportionate share of the net pension liability associated with the School System Total 638,963 $ 417,668,742 47 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Teachers' Retirement System (Continued) Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (Continued) The net pension liability was measured as of June 30, 2017. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2016. An expected total pension liability as of June 30, 2017, was determined using standard roll-forward techniques. The School System's proportion of the net pension liability was based on contributions to TRS during the fiscal year ended June 30, 2017. At June 30 2017, the School System's proportion was 2.243868%, which was an increase of 0.091017% from its proportion measured as of June 30, 2016. For the year ended June 30, 2018, the School System recognized pension expense of $47,264,571 and revenue of $35,388 for support provided by the State of Georgia for certain support personnel. At June 30, 2018, the School System reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Differences between expected and actual experience Deferred Outflows of Resources $ 15,599,483 Deferred Inflows of Resources $ 1,573,827 Changes of assumptions 9,141,810 - Net difference between projected and actual earnings on pension plan investments - 2,869,862 Changes in proportion and differences between School System contributions and proportionate share of contributions 12,696,890 4,816,445 School System contributions subsequent to the measurement date 46,354,010 - Total $ 83,792,193 $ 9,260,134 48 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Teachers' Retirement System (Continued) Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (Continued) School System contributions, subsequent to the measurement date, of $46,354,010 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, 2019. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: Year ending June 30, 2019 2020 2021 2022 2023 $ (1,165,563) 23,664,396 12,973,133 (7,854,603) 560,686 Actuarial Assumptions The total pension liability as of June 30, 2017, was determined by an actuarial valuation as of June 30, 2016, using the following actuarial assumptions, applied to all periods included in the measurement: Inflation Salary increases Investment rate of return 2.75% 3.75 - 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 retirements and dependent beneficiaries. The RP-2000 Disabled Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB, set forward two year for males and four years for females, was used for death after disability retirement. Rates of mortality in active service were based on the RP-2000 Employee Mortality Tables projected to 2025 with projection scale BB. The actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014. 49 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Teachers' Retirement System (Continued) Actuarial Assumptions (Continued) The long-term expected rate of return on pension plan investments was determined using a lognormal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of pension plan investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: Asset class Fixed income Domestic large equities Domestic mid equities Domestic small equities International developed market equities International emerging market equities Total Target allocation 30.00 % 39.80 3.70 1.50 19.40 5.60 100.00 % Long-term expected real rate of return* (0.50) % 9.00 12.00 13.50 8.00 12.00 *Rates shown are net of the 2.75% assumed rate of inflation. Discount Rate The discount rate used to measure the total pension liability was 7.50%. 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 State of Georgia contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current 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. 50 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Teachers' Retirement System (Continued) Sensitivity of the School System's Proportionate Share of the Net Pension Liability to Changes in the Discount Rate The following presents the School System's proportionate share of the net pension liability calculated using the discount rate of 7.50%, as well as what the School System'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: School System's proportionate share of the net pension liability 1% Decrease (6.50%) Current Discount Rate (7.50%) 1% Increase (8.50%) $ 684,394,796 $ 417,029,779 $ 196,781,098 Pension Plan Fiduciary Net Position Detailed information about the pension plan's fiduciary net position is available in the separately issued TRS financial report which is publically available at www.trsga.com/publications. 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 TRS. 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. 51 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Public School Employees' Retirement System (PSERS) (Continued) Benefits Provided (Continued) Upon retirement, the member will receive a monthly benefit of $14.75, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits. Contributions The general assembly makes an annual appropriation to cover the employer contribution to PSERS on behalf of local school employees (bus drivers, cafeteria workers, and maintenance staff). The annual employer contribution required by statute is actuarially determined and paid directly to PSERS by the State Treasurer in accordance with O.C.G.A. .47-4-29(a) and 60(b). Contributions are expected to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Individuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees. Pension Liabilities and Pension Expense At June 30, 2018, the School System did not have a liability for a proportionate share of the net pension liability of PSERS because of the related State of Georgia support. The amount of the State's proportionate share of the net pension liability associated with the School System is as follows: State of Georgia's proportionate share of the net pension liability associated with the School System $ 5,379,011 52 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Public School Employees' Retirement System (PSERS) (Continued) Pension Liabilities and Pension Expense (Continued) The net pension liability was measured as of June 30, 2017. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2016. An expected total pension liability as of June 30, 2017, was determined using standard roll-forward techniques. The State's proportion of the net pension liability associated with the School System was based on actuarially determined contributions paid by the State during the fiscal year ended June 30, 2017. For the year ended June 30, 2018, the School System recognized pension expense of $1,084,081 and revenue of $1,084,081 for support provided by the State of Georgia. Actuarial Assumptions The total pension liability was determined by an actuarial valuation as of June 30, 2016, using the following actuarial assumptions, applied to all periods included in the measurement: Inflation Salary increase Investment rate of return 2.75% N/A 7.50%, net pension plan investment expense, including inflation Post-retirement rates were based on the RP-2000 Blue-Collar Mortality Table projected to 2025 with projection scale BB, set forward three years for males and two years for females, for the period after service retirement and for dependent beneficiaries. The RP-2000 Disabled Mortality projected to 2025 with projection scale BB, set forward five years for both males and females, was used for death and 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 health retirees and 9% 11% less than the expected under the selected table for disables retiree. 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, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014. 53 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Public School Employees' Retirement System (PSERS) (Continued) Actuarial Assumptions (Continued) The long-term expected rate of return on 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 Fixed income Domestic large equities Domestic mid equities Domestic small equities International developed market equities International emerging market equities Alternatives Target allocation 30.00 % 37.20 3.40 1.40 17.80 5.20 5.00 Long-term expected real rate of return* (0.50) % 9.00 12.00 13.50 8.00 12.00 10.50 Total 100.00 % *Rates shown are net of the 2.75% assumed rate of inflation. Discount Rate The discount rate used to measure the total pension liability was 7.50%. 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 non-employer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current 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. 54 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Employees' Retirement System ("ERS") Plan Description ERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees. Title 47 of the O.C.G.A. assigns the authority to establish and amend the benefit provisions to the State Legislature. ERS issues a publicly available financial report that can be obtained at www.ers.ga.gov/formspubs/formspubs. Benefits Provided The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan ("GSEPS"). Employees under the Old Plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are New Plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS. Under the Old Plan, the New Plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of ten years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60. Retirement benefits paid to members are based upon the monthly average of the member's highest four consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, post-retirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension, at reduced rates, to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS. 55 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Employees' Retirement System ("ERS") (Continued) Contributions Member contributions under the Old Plan are 4% of annual compensation, up to $4,200, plus 6% of annual compensation in excess of $4,200. Under the Old Plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the Old Plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the New Plan and GSEPS are 1.25% of annual compensation. The School System's contractually required contribution rate, actuarially determined annually, for the year ended June 30, 2018, was 24.69% of annual covered payroll for Old and New Plan members and 21.69% for GSEPS members. The School System's contributions to ERS totaled $36,522 for the year ended June 30, 2018. 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. Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At June 30, 2018, the School System reported a liability for its proportionate share of the net pension liability of ERS in the amount of $262,159. The net pension liability was measured as of June 30, 2017. The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of June 30, 2016. An expected total pension liability as of June 30, 2017, was determined using standard roll-forward techniques. The School System's proportion of the net pension liability was based on contributions to ERS during the fiscal year ended June 30, 2017. At June 30, 2017, the School System's proportion was 0.006455%, which was an increase of 0.000887% from its proportion measured as of June 30, 2016. 56 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Employees' Retirement System ("ERS") (Continued) Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (Continued) For the year ended June 30, 2018, the School System recognized pension expense of $40,603. At June 30, 2018, the School System reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Difference between expected and actual experience Deferred Outflows of Resources $ 2,873 Deferred Inflows of Resources $ 2 Changes of assumptions 597 - Net difference between projected and actual earnings on pension plan investments - 653 Changes in proportion and differences between Employer contributions and proportionate share of contributions 23,036 18,876 Employer contributions subsequent to the measurement date 36,522 - Total $ 63,028 $ 19,531 School System contributions subsequent to the measurement date of $36,522 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, 2019. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: Year ending June 30, 2019 2020 2021 2022 $ (7,555) 19,020 2,943 (7,433) 57 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Employees' Retirement System ("ERS") (Continued) Actuarial Assumptions The total pension liability as of June 30, 2017 was determined by an actuarial valuation as of June 30, 2016, using the following actuarial assumptions, applied to all periods included in the measurement: Inflation Salary increase Investment rate of return 2.75% 3.25 - 7.00%, including inflation 7.50%, net of pension plan investment expense, including inflation Post-retirement mortality rates were based on the RP-2000 Combined Mortality Table with future mortality improvement projected to 2025 with the Society of Actuaries' projection scale BB, set forward two years for males and females for service retirement and dependent beneficiaries. The RP-2000 Disables Mortality Table with future mortality improvement projected to 2025 with Society of Actuaries' projection scale BB and set back seven years for males and set forward three years for females was used for death and 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% 12% less than the actual number of deaths that occurred during the experience study period for service retirements and beneficiaries and for disability retirements. Rates of mortality in active service were based on the RP2000 Employee Mortality Table projected to 2025 with projection scale BB. The actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the period July 1, 2009 June 30, 2014. 58 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Employees' Retirement System ("ERS") (Continued) Actuarial Assumptions (Continued) The long-term expected rate of return on pension plan investments was determined using a lognormal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of pension plan investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: Asset class Fixed income Domestic large equities Domestic mid equities Domestic small equities International developed market equities International emerging market equities Alternatives Target allocation 30.00 % 37.20 3.40 1.40 17.80 5.20 5.00 Total 100.00 % *Rates shown are net of the 2.75% assumed rate of inflation. Long-term expected real rate of return* (0.05) % 9.00 12.00 13.50 8.00 12.00 10.50 Discount Rate The discount rate used to measure the total pension liability was 7.50%. 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 State of Georgia contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current 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. 59 NOTES TO FINANCIAL STATEMENTS NOTE 11. RETIREMENT PLANS (CONTINUED) Employees' Retirement System (ERS) (Continued) Sensitivity of the School System's Proportionate Share of the Net Pension Liability to Changes in the Discount Rate The following presents the School System's proportionate share of the net pension liability calculated using the discount rate of 7.50%, as well as what the School System'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: Employer's proportionate share of the net pension liability 1% Decrease (6.50%) Current Discount Rate (7.50%) 1% Increase (8.50%) $ 370,025 $ 262,159 $ 170,147 Pension Plan Fiduciary Net Position Detailed information about the pension plan's fiduciary net position is available in the separately issued ERS financial report which is publically available at www.ers.ga.gov/formspubs/formspubs. Aggregate Amounts Aggregated amounts for all pensions plans are as follows: TRS Net pension liability $ 417,029,779 $ Deferred outflows 83,792,193 Deferred inflows 9,260,134 Pension expense 47,264,571 ERS PSERS Total 262,159 $ - $ 417,291,938 63,028 - 83,855,221 19,531 - 9,279,665 40,603 1,084,081 48,389,255 60 NOTES TO FINANCIAL STATEMENTS NOTE 12. OTHER POST-EMPLOYMENT BENEFITS Plan Description The School System participates in the State of Georgia School Employees' Post-employment Benefit Fund (the "School OPEB Fund") which is another post-employment benefit ("OPEB") plan administered by the State of Georgia Department of Community Health ("DCH"). Certified teachers and non-certified employees of the Board as defined in 20-2-875 of the 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 of the State of Georgia and administered by a Board of Community Health ("DCH 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 DCH Board. The School OPEB Fund is included in the State of Georgia Comprehensive Annual Financial Report which is publicly available and can be obtained at https://sao.georgia.gov/comprehensive-annual-financialreports. Benefits The contribution requirements of plan members and participating employers are established and may be amended by the Board of the State of Georgia Department of Community Health. 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 of Community Health, the School OPEB Fund is substantially funded on a pay-as-you-go basis; that is, annual cost of providing benefits will be financed in the same year as claims occur. Contributions required and made to the School OPEB Fund from the School System were $15,357,241 for the year ended June 30, 2018. Active employees are not required to contribute to the School OPEB Fund. 61 NOTES TO FINANCIAL STATEMENTS NOTE 12. OTHER POST-EMPLOYMENT BENEFITS (CONTINUED) OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB Effective July 1, 2017, the School System implemented the provisions of GASB Statement No. 75, Accounting and Financial Reporting for Post-employment Benefits Other Than Pensions, which significantly changed the School System's accounting for OPEB amounts. The information disclosed in this note is presented in accordance with this new standard. At June 30, 2018, the School System reported a liability of $401,859,478 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2017. The total OPEB liability used to calculate the net OPEB liability was based on an actuarial valuation as of June 30, 2016. An expected total OPEB liability as of June 30, 2017, was determined using standard rollforward techniques. The School System's proportion of the net OPEB liability was actuarially determined based on employer contributions to the School OPEB Fund during the fiscal year ended June 30, 2017. At June 30, 2017, the School System's proportion was 2.860218%, which was an increase of 0.055751% from its proportion measured as of June 30, 2016. For the year ended June 30, 2018, the School System recognized OPEB expense of $24,622,959. At June 30, 2018, the Board reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: Changes of assumptions Net difference between projected and actual earnings on OPEB plan investments Changes in proportion and differences between School System contributions and proportionate share of contributions School System contributions subsequent to the measurement date Total Deferred Outflows of Resources $ - $ Deferred Inflows of Resources 30,600,574 117,537 - 15,097,809 8,094,873 15,357,241 $ 30,572,587 $ 38,695,447 62 NOTES TO FINANCIAL STATEMENTS NOTE 12. OTHER POST-EMPLOYMENT BENEFITS (CONTINUED) OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB (Continued) School System contributions subsequent to the measurement date of $15,357,241 are reported as deferred outflows of resources and will be recognized as a reduction of the net OPEB liability in the year ending June 30, 2019. 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 ending June 30, 2019 2020 2021 2022 2023 2024 School OPEB Plan $ (4,214,795) (4,214,795) (4,214,795) (4,214,795) (4,244,180) (2,376,741) Actuarial assumptions The total OPEB liability as of June 30, 2017, was determined by an actuarial valuation as of June 30, 2016, 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, 2017: Inflation rate Salary increases Long-term expected rate of return Healthcare cost trend rate Ultimate trend rate Year of ultimate trend 2.75% TRS- 3.75%-9.00%, average, including inflation 3.88%, compunded annually, net of investment expense, and including inflation Pre-Medicare eligible - 7.75%, Medicare eligible 5.75% Pre-Medicare eligible - 5.00%, Medicare eligible 5.00% 2022 63 NOTES TO FINANCIAL STATEMENTS NOTE 12. OTHER POST-EMPLOYMENT BENEFITS (CONTINUED) Actuarial assumptions (Continued) 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 one year for males, was 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, was 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 three years for males and two years for females, was used for the period after service retirement and for beneficiaries of deceased members. The RP2000 Disabled Mortality Table projected to 2025 with projection scale BB, set forward five years for both males and females, was used for the period after disability retirement. The actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial experience study for the pension system, which covered the five-year period ending June 30, 2014. Projection of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the School System 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. Additionally, there was a change that affected measurement of the total OPEB liability since the prior measurement date. The methodology used to determine employee and retiree participation in the School OPEB Fund is based on their current or last employer payroll location. Current and former employees of public school districts, libraries, regional educational service agencies, and community colleges are allocated to the School OPEB Fund irrespective of retirement system affiliation. 64 NOTES TO FINANCIAL STATEMENTS NOTE 12. OTHER POST-EMPLOYMENT BENEFITS (CONTINUED) Actuarial assumptions (Continued) The long-term expected rate of return on OPEB plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected nominal returns, net of investment expense and the assumed rate of inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: Asset class Local Government Investment Pool Target allocation (%) 100.00 % Long-term expected real rate of return (%) 3.88 % Discount rate The discount rate has changed since the prior measurement date from 3.07% to 3.58%. In order to measure the total OPEB liability for the School OPEB Fund, a single equivalent interest rate of 3.58% was used as the discount rate. This is comprised mainly of the yield or index rate for 20-year taxexempt general obligation municipal bonds with an average rating of AA or higher (3.56% per the Bond Buyer Index). The projection of cash flows used to determine the discount rate assumed that the current sharing of costs between the employer and the member will continue and that contributions 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 2115. 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 2029. Therefore, the long-term expected rate of return on OPEB plan investments was applied to discount projected benefit payments until 2029. The discount rate of 3.58% was the single rate which, when applied to all projected benefit payments, resulted in the same present value of benefit payments when the above discussed calculations are combined. The calculated discount rate of 3.58% was applied to all periods of projected benefit payments to determine the total OPEB liability. 65 NOTES TO FINANCIAL STATEMENTS NOTE 12. OTHER POST-EMPLOYMENT BENEFITS (CONTINUED) Sensitivity of the School System's proportionate share of the net OPEB liability to changes in the healthcare cost trend rate The following presents the School System's proportionate share of the net OPEB liability calculated using the discount rate of 3.58%, as well as what the School System's proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (2.58%) or 1-percentage-point higher (4.58%) than the current rate: School System's proportionate share of the net OPEB liability 1% Decrease (2.58%) Current Discount Rate (3.58%) 1% Increase (4.58%) $ 477,136,145 $ 401,859,478 $ 342,450,941 The following presents the School System's proportionate share of the net OPEB liability calculated using the healthcare cost trend rates of 5.00% to 7.75%, as well as what the Board'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 (4.00% to 6.75%) or 1-percentage-point higher (6.00% to 8.75%) than the current rates: School System's proportionate share of the net OPEB liability 1% Current Decrease discount rate (4.00% to 6.75%) (5.00 to 7.75%) 1% Increase (6.00 to 8.75%) $ 333,095,724 $ 401,859,478 $ 491,389,780 NOTE 13. RISK MANAGEMENT The School System is exposed to various risks of loss for claims associated with torts; theft of, damage to and destruction of assets; errors and omissions; natural disaster; Workers' Compensation; unemployment compensation; and dental benefits. The School System is self-insured for workers' compensation. The School System purchases commercial insurance for all other risks of loss. The School System has not experienced any significant reduction in insurance coverage from the previous years nor has it paid any settlements in excess of insurance coverage in the past three years. 66 NOTES TO FINANCIAL STATEMENTS NOTE 13. RISK MANAGEMENT (CONTINUED) Workers' Compensation The School System is partially self-insured for Workers' Compensation claims of its employees. Claims exceeding $250,000, but less than $2,000,000 per occurrence are covered through a private insurance carrier. The School System is liable for any other claims filed. The School System has entered into a contract with a third party to administer the program. Activity is accounted for in the General Fund. Changes in the balances of workers' compensation claims liabilities for the past two fiscal years for which the School System is self-insured are as follows: Workers' Compensation June 30, 2018 June 30, 2017 Unpaid claims, beginning of fiscal year Incurred claims (including IBNRs) Claim payments and changes in estimates Unpaid claims, end of fiscal year $ 3,330,395 $ 2,658,555 3,081,526 3,105,352 (2,469,480) (2,433,512) $ 3,942,441 $ 3,330,395 NOTE 14. COMMITMENTS AND CONTINGENCIES The School System is involved in a number of legal matters which either have or could result in litigation. Although the outcome of these lawsuits is not presently determinable, in the opinion of the School System's legal counsel, the resolution of these matters will not have a material adverse effect on the financial condition of the School System. The School System participates in numerous state and federal grant programs, which are governed by various rules and regulations of the grantor agencies. Costs charged to the respective grant programs are subject to audit and adjustment by the grantor agencies; therefore, to the extent that the School System has not complied with the rules and regulations governing grants, refunds of any money received may be required and the collectability of any related receivable at June 30, 2018, may be impaired. In the opinion of the School System, there are no significant contingent liabilities relating to compliance with the rules and regulations governing the respective grants; therefore, no provision has been recorded in the accompanying financial statements for such contingencies. The School System is committed under outstanding construction contracts in the Capital Projects Fund in the amount of $63,141,857. Construction contracts include new school construction and expansion and renovation of existing facilities. 67 NOTES TO FINANCIAL STATEMENTS NOTE 15. SUBSEQUENT EVENT On July 16, 2018, the School System issued a tax anticipation note in advance of property tax collections with a financial institution in the amount of $40,000,000. Proceeds from this short-term loan was issued to provide cash for operations until property tax collections were received by the School District. The maturity date of the note was December 31, 2018, at which time the entire balance plus accrued interest was repaid. Additionally, on September 26, 2019, the School System issued a tax anticipation note in advance of property tax collections with a financial institution in the amount of $30,000,000. Proceeds from this short-term loan was issued to provide cash for operations until property tax collections were received by the School District. The maturity date of the note was December 31, 2019, at which time the entire balance plus accrued interest was repaid. NOTE 16. CHANGE IN ACCOUNTING PRINCIPLE The District implemented GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions, through which accounting for OPEB plans and the related disclosure requirements were modified. A restatement to the July 1, 2017 beginning net position for the governmental and business-type activities, and the School Food Service Fund, was made to recognize this change in accounting principle. The resulting adjustments are as follows: Net position, governmental activities, as previously reported Changes in accounting principles for the implementation of GASB Statement No. 75 Net position, governmental activities,as restated $ 491,317,966 371,692,156 $ 119,625,810 Net position, business -type activities, as previously reported Changes in accounting principles for the implementation of GASB Statement No. 75 Net position, business-type activities, as restated $ 12,656,162 29,024,464 $ (16,368,302) Net position, School Food Service fund, as previously reported Changes in accounting principles for the implementation of GASB Statement No. 75 Net position, School Food Service fund, as restated $ 9,101,403 29,024,464 $ (19,923,061) 68 Required Supplementary Information Clayton County Public Schools CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY TEACHERS' RETIREMENT SYSTEM OF GEORGIA FOR THE YEAR ENDED JUNE 30, School System's proportion of the net pension liability 2018 2.243868% 2017 2.152851% 2016 2.197081% 2015 2.196357% School System's proportionate share of the net pension liability $ 417,029,779 $ 444,157,166 $ 334,483,765 $ State of Georgia's proportionate share of the net pension liability associated with the School System 638,963 920,560 683,558 Total $ 417,668,742 $ 445,077,726 $ 335,167,323 $ School System's covered payroll $ 257,711,710 $ 254,456,566 $ 235,884,198 $ 277,480,737 572,053 278,052,790 224,071,946 School System's proportionate share of the net pension liability as a percentage of its covered payroll 161.82% 174.55% 141.80% 123.84% Plan fiduciary net position as a percentage of the total pension liability 79.33% 76.06% 81.44% 84.03% Note: Schedule is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available. 69 CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CONTRIBUTIONS TEACHERS' RETIREMENT SYSTEM OF GEORGIA FOR THE YEAR ENDED JUNE 30, Contractually required contribuitions 2018 2017 2016 $ 46,354,010 $ 36,775,461 $ 36,310,952 $ 2015 31,018,772 Contributions in relation to the contractually required contribution Contribution deficiency (excess) School System's covered payroll Contributions as a percentage of covered payroll 46,354,010 36,775,461 36,310,952 - - - $ 275,752,588 $ 257,711,710 $ 254,456,566 $ 31,018,772 - 235,884,198 16.81% 14.27% 14.27% 13.15% Note: Schedule is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available. 70 CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION NOTES TO REQUIRED SUPPLEMENTARY INFORMATION TEACHERS' RETIREMENT SYSTEM OF GEORGIA FOR THE YEAR ENDED JUNE 30, 2018 Changes of assumptions 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 increases were adjusted to more closely reflect actual and anticipated experience. On November 18, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to rates of mortality, retirement, disability, withdrawal and salary increases. The expectation of retired life mortality was changed to 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. 71 CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM FOR THE YEAR ENDED JUNE 30, School System's proportion of the net pension liability School System's proportionate share of the net pension liability 2018 0.00% - 2017 0.00% - 2016 0.00% - 2015 0.00% - State of Georgia's proportionate share of the net position liability associated with the School System Total School System's covered payroll School System'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 $ 5,379,011 $ 7,277,689 $ 4,487,155 $ 3,516,516 $ 5,379,011 $ 7,277,689 $ 4,487,155 $ 3,516,516 $ 23,425,764 $ 23,090,120 $ 21,459,053 $ 19,768,819 N/A 85.69% N/A 81.00% N/A 87.00% N/A 88.29% Note: Schedule is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available. 72 CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION NOTES TO REQUIRED SUPPLEMENTARY INFORMATION PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM FOR THE YEAR ENDED JUNE 30, 2018 Changes of assumptions 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. 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 the 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 three years for males and two years for females. 73 CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY EMPLOYEES' RETIREMENT SYSTEM FOR THE YEAR ENDED JUNE 30, School System's proportion of the net pension liability 2018 2017 2016 2015 0.006455% 0.005568% 0.008875% 0.006853% School System's proportionate share of the net pension liability $ 262,159 $ 263,390 $ 359,562 $ 257,030 School System's covered payroll $ 159,105 $ 129,462 $ 202,910 $ 154,312 School System's proportionate share of the net pension liability as a percentage of its covered payroll 164.77% 203.45% 177.20% 166.57% Plan fiduciary net position as a percentage of the total pension liability 76.33% 72.34% 76.20% 77.99% Note: Schedule is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available. 74 CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CONTRIBUTIONS EMPLOYEES' RETIREMENT SYSTEM FOR THE YEAR ENDED JUNE 30, Contractually required contributions Contributions in relation to the contractually required contribution Contribution deficiency (excess) School System's covered payroll 2018 2017 2016 2015 $ 36,522 $ 39,283 $ 32,003 $ 44,559 36,522 39,283 32,003 44,559 - - - - $ 147,922 $ 159,105 $ 129,462 $ 202,910 Contributions as a percentage of covered payroll 24.69% 24.69% 24.72% 21.96% Note: Schedule is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available. 75 CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION NOTES TO REQUIRED SUPPLEMENTARY INFORMATION EMPLOYEES' RETIREMENT SYSTEM FOR THE YEAR ENDED JUNE 30, 2018 Changes of assumptions On December 17, 2015, the Board adopted recommended changes to the economic and demographic assumptions utilized by the System. Primary among the changes were the updates to the rates of mortality, retirement, and withdrawal. 76 CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PROPORTIONATE SHARE OF THE NET OPEB LIABILITY SCHOOL OPEB FUND FOR THE YEAR ENDED JUNE 30, 2018 School System's proportion of the net OPEB liability School System's proportion of the net OPEB liability School System's covered-employee payroll School System'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 2018 2.860218% $ 401,859,478 $ 328,386,384 122.37% 1.61% Note: Schedule is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available. 77 CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CONTRIBUTIONS SCHOOL OPEB FUND FOR THE YEAR ENDED JUNE 30, Contractually required contribution $ Contributions in relation to the contractually required contribution Contribution deficiency (excess) $ 2018 15,357,241 15,357,241 - 2017 $ 14,913,404 14,913,404 $ - School System's covered-employee payroll Contributions as a percentage of covered-employee payroll $ 333,958,749 4.60% $ 328,386,384 4.54% Note: Schedule is intended to show information for the last ten fiscal years. Additional years will be displayed as they become available. 78 CLAYTON COUNTY BOARD OF EDUCATION REQUIRED SUPPLEMENTARY INFORMATION NOTES TO REQUIRED SUPPLEMENTARY INFORMATION SCHOOL OPEB FUND FOR THE YEAR ENDED JUNE 30, 2018 Changes of Benefit Terms In the June 30, 2010 actuarial valuation, there was a change of benefit terms to require Medicare-eligible recipients to enroll in a Medicare Advantage plan to receive the State subsidy. Changes of Assumptions In the revised June 30, 2017 actuarial valuation, there was a change relating to employee allocation. Employees were previously allocated based on their Retirement System membership, and currently employees are allocated based on their current employer payroll location. In the June 30, 2015 actuarial valuation, decremental and underlying inflation assumptions were changed to reflect the Retirement Systems' experience studies. In the June 30, 2012 actuarial valuation, a data audit was performed and data collection procedures and assumptions were changed. 79 Combining Fund Schedules Clayton County Public Schools CLAYTON COUNTY BOARD OF EDUCATION NONMAJOR GOVERNMENTAL FUNDS SPECIAL REVENUE FUNDS The Adult Education Fund is used to account for federal grant funds passed through the Georgia Department of Technical and Adult Education for the purpose of providing a vocational curriculum program for adults. The After School Program Fund is used to account for the after school program in place at all Clayton County elementary schools. Revenues consist of fees paid for the after school care of students. The Athletics Fund is used to account for athletic events held on behalf of Clayton County's schools. Revenues consist primarily of ticket and concession sales. The Lottery Fund is used to account for state grant funds flowing through the State of Georgia Department of Education for various programs as established by the state. The South Metro Fund is used to account for the development center for children with physical and mental handicaps. The Title I Fund is used to account for federal grant funds passed through the State of Georgia Department of Education to the School System to provide remedial education in the areas of reading and math and to provide a special education program for children who are physically handicapped. The Title II Fund is used to account for federal grant funds passed through the State of Georgia Department of Education to the School System for the purpose of training teachers in math, science, foreign language, and computer science programs. The Title III Fund is used to account for federal grant funds passed through the State of Georgia Department of Education to the School System for the purpose of providing assistance to limited English proficient children and youth in Clayton County schools in attaining English proficiency. The All Other Special Revenue Funds is used to account for the activities of various other programs funded by local, state and federal funds. The Title IV Fund is used to account for federal grant funds passed through the State of Georgia Department of Education to the School System for the purpose of improving student's academic achievement by increasing the capacity of states, local educational agencies, schools and local communities to: 1) provide all students with access to a well-rounded education; 2) improve school conditions for student learning; and 3) improve the use of technology in order to improve the academic achievement and digital literacy for all students. The Title VI-B Preschool Fund is used to account for federal funds authorized by the Individuals with Disabilities Education Act that are passed through the State of Georgia Department of Education to the School System for the purpose of providing special education programs for children with disabilities ages three to five. CLAYTON COUNTY BOARD OF EDUCATION NONMAJOR GOVERNMENTAL FUNDS SPECIAL REVENUE FUNDS (CONTINUED) The Title VI-B Fund is used to account for federal funds in connection with the Individuals with Disabilities Education Act that are passed through the State of Georgia Department of Education to the School System for the purpose of providing special education programs for children in pre-kindergarten through 12th grade. The Vocational Programs Fund is used to account for federal grant funds passed through the State of Georgia Department of Education to the School System for the purpose of providing a vocational curriculum program. The School Discretionary Fund is used to account for the portion of the school activity resources used for general governmental expenditures. CLAYTON COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2018 ASSETS Cash Receivables: Accounts Intergovernmental Due from other funds Prepaid items Total assets LIABILITIES AND FUND BALANCES LIABILITIES Accounts payable Accrued payroll and payroll withholdings Other current liabilities Unearned revenue Due to other funds Total liabilities DEFERRED INFLOWS Unavailable revenue - charges for services Total deferred inflows FUND BALANCES Restricted Committed for student programs Unassigned Total fund balances Total liabilities and fund balances (Continued) Special Revenue Funds Adult Education After School Program Athletics Lottery $ - $ - $ 17,170 $ - 176,349 1,423 - 570,161 - 50,000 - 473,376 - $ 177,772 $ 570,161 $ 67,170 $ 473,376 $ 2,590 $ 13,273 - 161,909 177,772 - 5,306 $ - 5,306 - 405 $ 70 58,444 58,919 18,714 454,662 - 473,376 - - - - - - - 564,855 - - - 564,855 $ 177,772 $ 570,161 $ - - 8,251 - - - 8,251 - 67,170 $ 473,376 80 Special Revenue Funds South Metro Title I Title II Title III All Other Special Revenue Title IV $ - $ - $ - $ - $ - $ - - - - - - 60,618 - 975,863 5,828,371 323,225 87,945 210,517 230,690 - - - - 47,478 - - - - - - - $ 975,863 $ 5,828,371 $ 323,225 $ 87,945 $ 318,613 $ 230,690 $ 5,559 $ 1,518,889 $ 35,996 $ 13,068 $ 30,455 $ 5,884 534,191 - 436,113 577,141 - 3,732,341 105,591 - 181,638 39,824 - 35,053 26,748 - 1,435 240,681 224,806 975,863 5,828,371 323,225 87,945 299,319 230,690 - - - - - - - - - - - - - - - - - - - - - 19,294 - - - - - - - - - - - 19,294 - $ 975,863 $ 5,828,371 $ 323,225 $ 87,945 $ 318,613 $ 230,690 81 CLAYTON COUNTY BOARD OF EDUCATION COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2018 ASSETS Special Revenue Funds Title VI-B Preschool Title VI-B Vocational Programs School Discretionary Total Nonmajor Governmental Funds Cash Receivables: Accounts Intergovernmental Due from other funds Prepaid items $ - $ - $ - $ 3,806,724 $ 3,823,894 77,920 - 1,981,410 - 21,366 - - 60,618 - 9,913,656 - 1,142,438 - - Total assets $ 77,920 $ 1,981,410 $ 21,366 $ 3,806,724 $ 14,940,606 LIABILITIES AND FUND BALANCES LIABILITIES Accounts payable $ 28,734 $ 233,924 $ 6,651 $ 45,846 $ 1,952,021 Accrued payroll and payroll withholdings Other current liabilities Unearned revenue Due to other funds 11,360 - 37,826 512,162 - 1,235,324 14,715 - 2,274,952 - 70 - 1,435 - 6,358,850 Total liabilities 77,920 1,981,410 21,366 45,846 10,587,328 DEFERRED INFLOWS Unavailable revenue - charges for services - - - - - Total deferred inflows - - - - - FUND BALANCES Restricted Committed for student programs Unassigned Total fund balances - - - - - - - - 3,760,878 4,353,278 - - - - - - - - 3,760,878 4,353,278 Total liabilities and fund balances $ 77,920 $ 1,981,410 $ 21,366 $ 3,806,724 $ 14,940,606 82 CLAYTON COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 REVENUES Local sources State sources Federal sources Total revenues EXPENDITURES Current: Instruction Pupil services Improvement of instructional services General administration School administration Student transportation Other support services Other non-instructional services Community service Total expenditures Deficiency of revenues under expenditures OTHER FINANCING SOURCES Transfers in Total other financing sources Net change in fund balances FUND BALANCES, beginning of year FUND BALANCES, end of year (Continued) Special Revenue Funds Adult Education After School Program Athletics Lottery $ 30,256 $ 1,683,279 $ 270,628 $ - 311,295 - - 2,359,244 512,654 - - - 854,205 1,683,279 270,628 2,359,244 647,909 - 217,000 - 864,909 122,843 1,600,553 1,723,396 453,235 453,235 2,964,229 - 232,567 - 3,196,796 (10,704) (40,117) (182,607) (837,552) 10,704 10,704 - (40,117) 185,000 185,000 2,393 837,552 837,552 - - 604,972 5,858 - $ - $ 564,855 $ 8,251 $ - 83 Special Revenue Funds South Metro Title I Title II Title III All Other Special Revenue Title IV $ - $ - $ - $ - $ 6,400 $ - 3,779,594 - - - 1,176,945 - 609,377 22,784,666 1,494,378 667,334 656,613 382,816 4,388,971 22,784,666 1,494,378 667,334 1,839,958 382,816 2,753,454 522,412 10,374 33,987 1,068,744 - 4,388,971 16,952,851 3,249,575 1,305,143 1,203,871 27,987 45,239 - 22,784,666 1,088,403 - 312,846 93,129 - 1,494,378 409,415 12,523 178,627 - 66,769 - 667,334 1,176,945 224,210 303,910 10,844 253,064 - 1,968,973 371,227 - 11,589 - 382,816 - - - - (129,015) - - - - - 130,776 - - - - - 130,776 - - - - - 1,761 - - - - - 17,533 - $ - $ - $ - $ - $ 19,294 $ - 84 CLAYTON COUNTY BOARD OF EDUCATION COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 REVENUES Local sources State sources Federal sources Total revenues EXPENDITURES Current: Instruction Pupil services Improvement of instructional services General administration School administration Student transportation Other support services Other non-instructional services Community service Total expenditures Deficiency of revenues under expenditures OTHER FINANCING SOURCES Transfers in Total other financing sources Net change in fund balances FUND BALANCES, beginning of year FUND BALANCES, end of year Special Revenue Funds Title VI-B Preschool Title VI-B Vocational Programs School Discretionary Total Nonmajor Governmental Funds $ - $ - $ - $ 7,462,150 $ 9,452,713 - - - - 7,627,078 352,197 8,570,114 577,837 - 36,607,986 352,197 8,570,114 577,837 7,462,150 53,687,777 221,023 131,174 352,197 6,578,068 1,693,840 298,206 - 8,570,114 577,837 - 577,837 7,966,685 - 7,966,685 41,708,046 5,833,734 2,993,105 1,330,987 1,068,744 38,831 112,008 706,299 1,600,553 55,392,307 - - - (504,535) (1,704,530) - - - - 1,164,032 - - - - 1,164,032 - - - (504,535) (540,498) - - - 4,265,413 4,893,776 $ - $ - $ - $ 3,760,878 $ 4,353,278 85 CLAYTON COUNTY BOARD OF EDUCATION SPECIAL REVENUE FUNDS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL - NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 REVENUES Local sources State sources Federal sources Total revenues EXPENDITURES Current: Instruction Pupil services Improvement of instructional services General administration School administration Student transportation Other support services Other non-instructional services Community service Total expenditures Deficiency of revenues under expenditures OTHER FINANCING SOURCES Transfers in Total other financing sources Net change in fund balances FUND BALANCES, beginning of year FUND BALANCES, end of year (Continued) Final Budget Adult Education Actual Variance With Final Budget $ 52,832 $ 30,256 $ (22,576) 356,124 311,295 (44,829) 566,993 512,654 (54,339) 975,949 854,205 (121,744) 695,265 - 280,684 - 975,949 647,909 - 217,000 - 864,909 47,356 - 63,684 - 111,040 - (10,704) (10,704) - 10,704 10,704 - 10,704 10,704 - - - - - - $ - $ - $ - 86 Final Budget After School Program Variance With Actual Final Budget $ 1,366,995 $ 1,683,279 $ - - - - 1,366,995 1,683,279 316,284 - 316,284 Final Budget $ 292,761 - - 292,761 Athletics Actual $ 270,628 - - 270,628 Variance With Final Budget $ (22,133) - - (22,133) 125,708 1,000 1,240,287 1,366,995 122,843 1,600,553 1,723,396 2,865 1,000 (360,266) (356,401) 523,027 523,027 453,235 453,235 69,792 69,792 - (40,117) (40,117) (230,266) (182,607) 47,659 - - - - - (40,117) 604,972 604,972 $ 604,972 $ 564,855 $ - (40,117) (40,117) $ 230,266 230,266 - 5,858 5,858 $ 185,000 185,000 2,393 5,858 8,251 $ (45,266) (45,266) 2,393 2,393 87 CLAYTON COUNTY BOARD OF EDUCATION SPECIAL REVENUE FUNDS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL - NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 REVENUES Local sources State sources Federal sources Total revenues EXPENDITURES Current: Instruction Pupil services Improvement of instructional services General administration School administration Student transportation Other support services Other non-instructional services Community service Total expenditures Deficiency of revenues under expenditures OTHER FINANCING SOURCES Transfers in Total other financing sources Net change in fund balances FUND BALANCES, beginning of year FUND BALANCES, end of year (Continued) Final Budget $ - 2,227,019 - 2,227,019 Lottery Actual $ - 2,359,244 - 2,359,244 Variance With Final Budget $ - 132,225 - 132,225 1,964,969 - 262,050 - 2,227,019 2,964,229 - 232,567 - 3,196,796 (999,260) - 29,483 - (969,777) - (837,552) (837,552) - 837,552 837,552 - 837,552 837,552 - - - - - - $ - $ - $ - 88 Final Budget $ - 3,779,700 1,147,524 4,927,224 South Metro Actual $ - 3,779,594 609,377 4,388,971 Variance With Final Budget $ - (106) (538,147) (538,253) Final Budget $ - - 33,996,766 33,996,766 Title I Actual $ - - 22,784,666 22,784,666 Variance With Final Budget $ - - (11,212,100) (11,212,100) 3,297,913 660,571 25,000 33,987 909,753 - 4,927,224 2,753,454 522,412 10,374 33,987 1,068,744 - 4,388,971 544,459 138,159 14,626 - (158,991) - 538,253 25,113,570 4,267,724 2,565,719 1,736,055 313,698 - 33,996,766 16,952,851 3,249,575 1,305,143 1,203,871 27,987 45,239 - 22,784,666 8,160,719 1,018,149 1,260,576 532,184 - 285,711 (45,239) 11,212,100 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - $ - $ - $ - $ - $ - $ - 89 CLAYTON COUNTY BOARD OF EDUCATION SPECIAL REVENUE FUNDS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL - NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 REVENUES Local sources State sources Federal sources Total revenues EXPENDITURES Current: Instruction Pupil services Improvement of instructional services Educational media services General administration School administration Student transportation Other support services Other non-instructional services Community service Total expenditures Deficiency of revenues under expenditures OTHER FINANCING SOURCES Transfers in Total other financing sources Net change in fund balances FUND BALANCES, beginning of year FUND BALANCES, end of year (Continued) Final Budget $ - - 2,461,822 2,461,822 Title II Actual $ - - 1,494,378 1,494,378 Variance With Final Budget $ - - (967,444) (967,444) 2,013,338 - 311,646 - 136,838 - 2,461,822 1,088,403 - 312,846 - 93,129 - 1,494,378 924,935 - (1,200) - 43,709 - 967,444 - - - - - - - - - - - - - - - $ - $ - $ - 90 Final Budget $ - - 958,510 958,510 Title III Actual $ - - 667,334 667,334 Variance With Final Budget $ - - (291,176) (291,176) Final Budget All Other Special Revenue Variance With Actual Final Budget $ 17,373 $ 6,400 $ 1,475,367 1,176,945 968,010 656,613 2,460,750 1,839,958 (10,973) (298,422) (311,397) (620,792) 458,529 156,340 342,441 1,200 958,510 409,415 12,523 178,627 - 66,769 - 667,334 49,114 143,817 163,814 1,200 (66,769) 291,176 1,176,945 445,465 552,997 15,582 10,844 258,917 - 2,460,750 1,176,945 224,210 303,910 10,844 253,064 - 1,968,973 221,255 249,087 15,582 5,853 491,777 - - - - (129,015) (129,015) - - - - - - - 130,776 - 130,776 130,776 130,776 - - - - 1,761 1,761 - - - 17,533 17,533 - $ - $ - $ - $ 17,533 $ 19,294 $ 1,761 91 CLAYTON COUNTY BOARD OF EDUCATION SPECIAL REVENUE FUNDS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL - NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 REVENUES Local sources State sources Federal sources Total revenues EXPENDITURES Current: Instruction Pupil services Improvement of instructional services General administration School administration Student transportation Other support services Other non-instructional services Community service Total expenditures Deficiency of revenues under expenditures OTHER FINANCING SOURCES Transfers in Total other financing sources Net change in fund balances FUND BALANCES, beginning of year FUND BALANCES, end of year (Continued) Final Budget Title VI-B Preschool Variance With Actual Final Budget $ - $ - $ - - - - 519,158 352,197 (166,961) 519,158 352,197 (166,961) 320,151 180,030 18,977 - 519,158 221,023 131,174 352,197 99,128 48,856 18,977 166,961 - - - - - - - - - - - - - - - $ - $ - $ - 92 Final Budget Title VI-B Actual Variance With Final Budget $ - $ - 15,545,716 15,545,716 - $ - - - 8,570,114 (6,975,602) 8,570,114 (6,975,602) Final Budget Vocational Programs Variance With Actual Final Budget $ - $ - $ - - 577,991 577,837 577,991 577,837 (154) (154) 10,826,448 6,578,068 4,248,380 577,991 577,837 154 3,547,166 1,693,840 1,853,326 - - - 1,026,834 298,206 728,628 - - - - - - - - - - - - - - - 145,268 - 145,268 - - - - - - - - - - - - - - - - - - - - - 15,545,716 8,570,114 6,975,602 577,991 577,837 154 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - $ - $ - $ - $ - $ - $ - 93 CLAYTON COUNTY BOARD OF EDUCATION SPECIAL REVENUE FUNDS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL - NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 REVENUES Local sources State sources Federal sources Interest earned on investments Total revenues EXPENDITURES Current: Instruction Pupil services Improvement of instructional services General administration School administration Student transportation Other support services Other non-instructional services Community service Total expenditures Deficiency of revenues under expenditures OTHER FINANCING SOURCES Transfers in Total other financing sources Net change in fund balances FUND BALANCES, beginning of year FUND BALANCES, end of year Final Budget Title IV Actual Variance With Final Budget $ - $ - $ - - - - 547,932 382,816 (165,116) - - - 547,932 382,816 (165,116) 483,018 35,000 29,914 - 547,932 371,227 - 11,589 - 382,816 111,791 35,000 18,325 - 165,116 - - - - - - - - - - - - - - - $ - $ - $ - 94 CLAYTON COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCY FUND FOR THE FISCAL YEAR ENDED JUNE 30, 2018 STUDENT ACTIVITY FUND ASSETS Cash and investments LIABILITIES Due to student organizations Elementary Schools: Anderson Arnold Brown Callaway Church Street East Clayton Edmonds Fountain Harper Hawthorne Haynie Huie Jackson Kemp Kemp Primary Kilpatrick King Lake City Lake Ridge Lee Street Marshall McGarrah Morrow Mt. Zion Mt. Zion Primary Northcutt Oliver Pointe South Riverdale River's Edge Smith Suder Swint Tara Unidos West Clayton White Academy Total Elementary Schools (Continued) Balance July 1, 2017 Increases Decreases Balance June 30, 2018 $ 475,165 $ 2,302,736 $ 2,227,883 $ 550,018 $ 1,543 4,877 1,326 864 3,040 1,715 927 2,065 4,443 343 4,361 1,500 9,695 3,220 4,133 1,570 570 7,851 344 693 2,267 1,892 4,142 3,274 3,504 2,600 1,480 1,606 1,506 1,823 12,362 330 1,527 592 2,262 581 10,852 107,680 3,780 17,567 31,338 4,256 15,315 1,765 1,650 2,810 6,660 8,261 4,219 4,158 29,725 20,014 12,369 8,369 3,147 4,710 8,123 10,542 6,551 11,637 8,338 9,653 5,587 7,573 33,491 3,026 6,318 12,550 13,314 10,651 3,714 2,550 3,744 2,110 64,519 404,104 5,194 17,568 29,857 3,569 14,864 1,418 1,563 1,947 9,086 6,899 2,273 4,279 30,536 17,374 13,618 8,946 2,599 4,070 7,953 9,056 6,029 8,199 5,762 7,170 8,010 6,915 34,386 2,372 3,801 13,009 16,444 10,289 3,645 1,627 3,503 1,898 68,985 394,713 129 4,876 2,807 1,551 3,491 2,062 1,014 2,928 2,017 1,705 6,307 1,379 8,884 5,860 2,884 993 1,118 8,491 514 2,179 2,789 5,330 6,718 5,757 1,081 3,258 585 2,260 4,023 1,364 9,232 692 1,596 1,515 2,503 793 6,386 117,071 95 CLAYTON COUNTY BOARD OF EDUCATION STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCY FUND FOR THE FISCAL YEAR ENDED JUNE 30, 2018 Balance July 1, 2017 Increases Decreases Balance June 30, 2018 LIABILITIES (CONTINUED) Due to student organizations (Continued) Middle Schools: Adamson Babb Elite Scholars Forest Park Jonesboro Kendrick Lovejoy Morrow Mundy's Mill North Clayton Pointe South Rex Mill Riverdale Roberts Sequoyah Total Middle Schools $ 4,321 $ 31,754 $ 28,616 $ 7,459 6,402 32,536 30,859 8,079 1,604 59,141 56,129 4,616 3,026 12,527 13,618 1,935 4,231 12,913 14,016 3,128 17,954 66,993 72,535 12,412 974 21,106 16,693 5,387 4,270 41,238 34,954 10,554 4,347 31,105 22,161 13,291 6,364 27,437 20,737 13,064 3,277 24,471 24,668 3,080 14,060 66,264 63,094 17,230 2,061 21,158 19,384 3,835 26,020 80,411 71,958 34,473 2,495 15,687 15,355 2,827 101,406 544,741 504,777 141,370 High Schools and Special Purpose Programs: Drew $ Forest Park Jonesboro Lovejoy Morrow Mt. Zion Mundy's Mill North Clayton Riverdale Perry Center Stilwell Flint River South Metro Total High Schools and Special Purpose Programs Total due to student organizations Total Liabilities $ 44,554 $ 20,082 15,268 28,216 40,998 9,719 39,286 13,862 18,284 558 34,590 246 416 266,079 475,165 475,165 $ 145,402 $ 80,594 96,486 138,958 178,082 173,643 138,333 85,354 96,025 12,701 208,146 167 - 1,353,891 2,302,736 2,302,736 $ 151,335 $ 85,842 96,661 120,686 169,044 168,892 153,647 80,748 91,288 12,159 197,678 413 - 1,328,393 2,227,883 2,227,883 $ 38,621 14,834 15,093 46,488 50,036 14,470 23,972 18,468 23,021 1,100 45,058 416 291,577 550,018 550,018 - 96 Statistical Section Clayton County Public Schools STATISTICAL SECTION This part of the Clayton County Board of Education's comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, required supplementary information, and supplementary information says about the School System's overall financial health. Contents Page Financial Trends .................................................................................................................................... 97 104 These schedules contain trend information to help the reader understand how the School System's financial performance and well-being have changed over time. Revenue Capacity................................................................................................................................ 105 111 These schedules contain information to help the reader assess the School System's most significant local revenue sources. Debt Capacity....................................................................................................................................... 112 115 These schedules present information to help the reader assess the affordability of the School System's current levels of outstanding debt and the School System's ability to issue additional debt in the future. Demographic and Economic Information ......................................................................................... 116 119 These schedules offer demographic and economic indicators to help the reader understand the environment within which the School System's financial activities take place. Operating Information ......................................................................................................................... 120 132 These schedules contain service and infrastructure data to help the reader understand how the information in the School System's financial report relates to the services the School System provides and the activities it performs. Financial Trends Clayton County Public Schools CLAYTON COUNTY BOARD OF EDUCATION NET POSITION BY COMPONENT LAST TEN FISCAL YEARS (ACCRUAL BASIS OF ACCOUNTING) Fiscal Year Ended June 30, Governmental Activities 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Business-type Activities 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Total Net Investment in Capital Assets $ 454,722,369 509,655,295 514,975,636 556,244,430 629,552,909 692,592,355 697,860,759 701,460,032 732,952,662 755,859,441 6,745,609 6,323,409 5,847,343 5,345,034 4,971,075 4,664,135 4,343,550 4,536,768 4,311,562 4,090,037 461,467,978 515,978,704 520,822,979 561,589,464 634,523,984 697,256,490 702,204,309 705,996,800 737,264,224 759,949,478 Restricted $ 75,170,499 76,436,913 107,326,734 94,959,761 50,650,232 7,453,160 25,018,520 49,076,743 51,276,442 52,579,247 - 75,170,499 76,436,913 107,326,734 94,959,761 50,650,232 7,453,160 25,018,520 49,076,743 51,276,442 52,579,247 Unrestricted Total Net Position $ 39,738,569 $ 19,633,982 34,102,935 42,725,690 63,922,382 75,900,621 (260,473,696) (239,778,071) (292,911,138) (695,434,921) 569,631,437 605,726,190 656,405,305 693,929,881 744,125,523 775,946,136 462,405,583 510,758,704 491,317,966 113,003,767 5,260,291 4,250,447 3,670,506 5,523,597 7,219,819 8,402,538 6,137,845 6,848,135 8,344,600 (20,383,186) 12,005,900 10,573,856 9,517,849 10,868,631 12,190,894 13,066,673 10,481,395 11,384,903 12,656,162 (16,293,149) 44,998,860 23,884,429 37,773,441 48,249,287 71,142,201 84,303,159 (254,335,851) (232,929,936) (284,566,538) (715,818,107) 581,637,337 616,300,046 665,923,154 704,798,512 756,316,417 789,012,809 472,886,978 522,143,607 503,974,128 96,710,618 97 CLAYTON COUNTY BOARD OF EDUCATION CHANGES IN NET POSITION LAST TEN FISCAL YEARS Expenses: Governmental activities Instructional services Pupil services Improvement of instructional services Educational media services General administration School administration Business administration Maintenance and operations Pupil transportation Support services - central Other support services Non-instructional services Community services Interest Total governmental activities expenses Business-type activities School food service Performing arts center Total business-type activities expenses Total primary government expenses Program Revenues: Governmental activities Charges for services: Instructional services Pupil services Instructional staff Maintenance and operations Student transportation Support services Other support services Non-instructional services Community services Operating grants and contributions Instructional services Pupil services Improvement of instructional services Educational media services General administration School administration Business administration Maintenance and operations Pupil transportation Support services-central Other support services Non-instructional services Community services Capital grants and contributions Instructional services Total governmental activities revenue 2009 Fiscal Year 2010 2011 2012 $ 326,173,396 $ 299,228,401 $ 289,659,696 $ 296,417,202 16,664,267 16,355,400 13,464,906 14,551,823 25,553,694 23,188,322 11,912,843 15,202,766 7,789,435 7,839,592 5,277,130 5,225,436 5,008,540 4,429,848 3,537,595 3,473,960 24,529,652 23,897,928 22,068,201 21,176,371 3,490,943 2,816,870 2,574,738 2,143,768 35,601,121 32,152,942 29,342,130 30,606,213 22,484,075 22,035,391 18,493,121 17,990,667 11,774,644 9,325,934 9,666,757 10,956,308 4,436,898 5,464,771 3,550,816 5,066,385 1,293,256 1,398,357 858,066 918,407 11,956,697 10,737,821 9,783,485 2,446,409 2,995 - - - 496,759,613 458,871,577 420,189,484 426,175,715 32,860,220 28,756,695 28,142,446 28,097,834 426,702 352,312 271,104 211,090 33,286,922 29,109,007 28,413,550 28,308,924 $ 530,046,535 $ 487,980,584 $ 448,603,034 $ 454,484,639 $ 8,073,750 $ 7,360,729 $ 7,268,417 $ 7,122,767 - - - - 5,624 8,416 - - - - - 1,738,894 - - - - - - - - 2,620 3,233 1,851 2,754 272,591 300,636 4,574,055 8,813,883 9,610,775 8,425,266 7,982,611 1,543,621 185,098,116 3,681,184 15,719,475 4,980,672 1,906,241 8,822,397 726,203 12,346,817 4,020,197 2,508,607 7,487 360,911 2,447,997 179,348,500 3,840,784 14,652,112 5,048,222 2,245,639 9,417,316 770,916 12,530,318 3,106,713 2,482,733 1,294,178 2,494,785 191,262,473 3,870,407 8,241,160 5,250,269 1,736,626 10,105,190 807,810 12,616,895 3,195,117 2,678,889 1,209,526 2,303,110 196,060,639 4,666,461 11,820,745 4,603,200 2,096,166 8,885,059 1,272,151 12,672,840 3,765,960 1,415,583 2,225,391 - 11,322,264 271,913,928 13,158,977 266,489,473 5,521,459 268,625,865 268,706,114 98 2013 2014 Fiscal Year 2015 2016 2017 2018 $ 274,436,343 $ 296,878,576 $ 297,202,738 $ 310,587,901 14,683,816 13,203,254 14,025,845 15,558,510 15,796,653 15,833,477 19,513,550 22,300,438 5,092,396 5,609,458 5,253,474 5,171,790 3,626,977 3,127,409 4,761,203 3,462,769 19,467,775 23,966,530 22,719,854 24,839,452 1,939,044 2,244,748 2,244,181 2,871,479 27,785,685 31,960,317 35,366,992 33,512,594 18,086,692 18,450,638 18,854,508 19,842,103 6,742,195 7,567,806 12,555,458 9,810,033 5,230,988 5,165,030 8,171,240 8,488,216 668,652 1,005,468 1,170,450 1,245,390 1,382,974 1,399,265 1,394,705 1,489,766 - - - - 394,940,190 426,411,976 443,234,198 459,180,441 355,548,266 20,604,479 24,409,886 6,346,177 13,165,267 28,908,499 3,699,757 37,154,682 22,327,835 10,985,292 4,013,195 1,271,329 1,464,021 - 529,898,684 387,163,582 22,587,200 21,733,172 6,688,537 7,102,414 31,429,970 5,646,571 39,565,111 24,613,821 10,572,138 3,591,846 1,206,941 1,599,636 - 563,500,939 29,584,227 31,391,613 34,186,940 37,061,777 38,527,414 37,943,474 237,737 251,027 233,425 283,267 300,235 327,201 29,821,964 31,642,640 34,420,365 37,345,044 38,827,649 38,270,675 $ 424,762,154 $ 458,054,616 $ 477,654,563 $ 496,525,485 $ 568,726,333 $ 601,771,614 $ 7,125,820 $ 8,675,990 $ 11,145,814 $ 9,198,993 $ 7,733,558 $ 7,492,405 - - - - - - - 15,965 107,079 108,663 117,332 122,842 358,066 - - - - - 201,163 - - - - - - - - - - - 1,937 962 464 122,775 14,752 46,059 4,898,162 4,377,974 5,236,965 5,267,124 5,460,542 6,000,758 1,474,558 - - 1,496,162 1,495,173 1,560,438 185,064,312 4,343,577 10,439,188 5,506,974 2,066,794 10,430,332 1,519,304 13,334,558 3,753,867 1,525,281 2,326,854 - 193,902,391 4,314,813 10,308,672 5,499,235 1,846,936 10,363,344 1,328,582 13,867,390 3,368,761 2,130,997 2,741,154 191,480 - 216,285,212 4,049,300 7,123,749 5,754,998 2,012,643 10,839,835 1,409,139 14,055,728 2,927,363 1,497,517 3,111,032 280,159 - 229,547,372 3,217,692 7,503,015 5,885,334 2,016,183 11,535,468 1,427,157 14,396,610 2,907,375 1,526,221 3,096,099 288,172 - 234,520,895 6,574,739 8,043,825 5,794,772 2,396,324 11,500,620 1,418,482 14,766,148 3,357,748 1,477,935 362,279 297,719 - 258,128,411 7,090,802 4,041,956 6,250,261 3,248,943 12,413,896 1,776,952 14,849,005 2,872,953 1,839,114 121,145 253,064 - 228,785 254,599,532 6,887,679 269,822,325 3,302,610 289,139,607 2,589,251 302,129,666 560,363 305,893,206 712,532 328,821,536 99 CLAYTON COUNTY BOARD OF EDUCATION CHANGES IN NET POSITION LAST TEN FISCAL YEARS Business-type activities Charges for services School food service Performing Arts center Operating grants and contributions School food service Total business-type activities program revenues Total primary government program revenues Net (Expense) Revenue Governmental activities Business-type activities Total primary government net expense General revenues and other changes in net assets Property taxes Sales taxes Other taxes Non-program specific state and federal aid Local school activity Interest and investment earnings Gain on sale of assets Transfers Total government activities Business-type activities: Interest and investment earnings Transfers Gain on sale of assets Total business-type activities Total primary government Change in Net Position Governmental activities Business-type activities Total primary government 2009 Fiscal Year 2010 2011 2012 $ 2,684,373 $ 2,321,346 $ 2,050,732 $ 2,229,141 249,268 236,175 187,542 62,508 25,159,432 25,084,941 25,085,843 27,354,321 28,093,073 27,642,462 27,324,117 29,645,970 $ 300,007,001 $ 294,131,935 $ 295,949,982 $ 298,352,084 $ (224,845,685) $ (192,382,104) $ (151,563,619) $ (157,469,601) (5,193,849) (1,466,545) (1,089,433) 1,337,046 $ (230,039,534) $ (193,848,649) $ (152,653,052) $ (156,132,555) $ 161,522,560 $ 148,094,346 $ 131,696,730 $ 121,423,671 49,121,173 53,669,034 48,353,695 48,656,878 1,377,987 983,594 859,735 875,671 26,847,151 20,855,861 20,855,861 23,494,466 5,361,901 4,229,182 - * - 1,790,719 396,312 412,878 473,966 14,390 268,841 85,136 69,525 137,274 (20,313) (21,301) - 246,173,155 228,476,857 202,242,734 194,994,177 69,790 (137,274) (67,484) 14,188 20,313 34,501 12,125 21,301 33,426 13,736 - 13,736 $ 246,105,671 $ 228,511,358 $ 202,276,160 $ 195,007,913 $ 21,327,470 $ 36,094,753 $ 50,679,115 $ 37,524,576 (5,261,333) (1,432,044) (1,056,007) 1,350,782 $ 16,066,137 $ 34,662,709 $ 49,623,108 $ 38,875,358 * In fiscal year 2011, various revenues were reclassified from general revenues to program revenues - charges for services. 100 2013 2014 Fiscal Year 2015 2016 2017 2018 $ 1,997,313 $ 161,314 151,302 $ 94,780 577,970 $ 67,039 680,996 $ 100,931 262,146 $ 141,847 338,093 137,025 28,983,556 32,266,406 34,346,668 37,403,625 39,694,915 37,863,840 31,142,183 32,512,488 34,991,677 38,185,552 40,098,908 38,338,958 $ 285,741,715 $ 302,334,813 $ 324,131,284 $ 340,315,218 $ 345,992,114 $ 367,160,494 $ (140,340,658) $ (156,589,651) $ (154,094,591) $ (157,050,775) $ (224,005,478) $ (234,679,403) 1,320,219 869,848 571,312 840,508 1,271,259 68,283 $ (139,020,439) $ (155,719,803) $ (153,523,279) $ (156,210,267) $ (222,734,219) $ (234,611,120) $ 109,928,475 $ 100,378,621 $ 104,814,477 $ 103,729,200 $ 104,169,552 $ 115,417,127 50,302,317 44,910,769 46,579,860 51,260,120 53,919,064 58,626,357 2,479,402 6,555,960 8,157,973 9,382,245 8,779,960 10,134,638 27,623,377 36,438,859 34,232,464 40,911,935 37,313,744 43,722,231 - - - - - - 117,347 113,496 109,660 51,882 92,036 100,189 85,382 10,100 - 131,514 290,384 56,818 - 2,459 - (63,000) - - 190,536,300 188,410,264 193,894,434 205,403,896 204,564,740 228,057,360 2,044 - 2,044 8,390 (2,459) 5,931 4,707 - 4,707 63,000 63,000 - - - - - 6,870 - 6,870 $ 190,538,344 $ 188,416,195 $ 193,899,141 $ 205,466,896 $ 204,564,740 $ 228,064,230 $ 50,195,642 $ 31,820,613 $ 39,799,843 $ 1,322,263 875,779 576,019 $ 51,517,905 $ 32,696,392 $ 40,375,862 $ 48,353,121 $ (19,440,738) $ 903,508 1,271,259 49,256,629 $ (18,169,479) $ (6,622,043) 75,153 (6,546,890) 101 CLAYTON COUNTY BOARD OF EDUCATION FUND BALANCES GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS (MODIFIED ACCRUAL BASIS OF ACCOUNTING) Fiscal Year Ended June 30, 2009 2010 Reserved - General Fund Unreserved Unreserved Designated Undesignated - 37,015,898 - 15,660,602 Total 37,015,898 15,660,602 2009 2010 Reserved - All Other Governmental Funds Unreserved Special Revenue Capital Projects 4,944,145 5,432,560 75,170,499 76,436,913 Total 80,114,644 81,869,473 2011 2012 2013 2014 2015 2016 2017 2018 Nonspendable $ 41,250 35,000 90,964 100,168 108,564 105,904 141,640 147,239 General Fund Restricted Assigned $ - $ - - - - - - - 22,179,645 - 31,509,111 - 34,731,866 - 34,731,866 Unassigned $ 28,247,867 38,327,401 56,429,149 74,311,992 56,002,569 51,546,900 7,143,888 (11,597,135) 2011 2012 2013 2014 2015 2016 2017 2018 Nonspendable $ - - - - - - - - All Other Governmental Funds Restricted Assigned $ 107,326,734 94,959,761 50,650,232 7,453,160 25,018,520 49,076,743 51,276,442 52,579,247 $ 6,521,236 4,760,921 5,119,465 5,163,429 5,028,854 4,718,977 4,893,776 4,353,277 Unassigned $ - (42,851) - - - - (84,642) Note: In fiscal year 2011, the School System adopted GASB 54 which changed the classifications of fund balance. 102 CLAYTON COUNTY BOARD OF EDUCATION CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS Revenues: Local sources State sources Federal sources Interest earned on investments Total revenues Expenditures: Current: Instructional services Pupil services Improvement of instructional services Educational media services General administration School administration Business services Maintenance and operations Student transportation Central support services Other support services On-behalf payments Other non-instructional services Community service Capital outlay Debt service: Principal retirement Interest and fiscal charges Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses): Sale of capital assets Transfer in Transfers out Total other financing sources (uses) Net change in fund balances Debt service as a percentage of noncapital expenditures 2009 Fiscal Year 2010 2011 2012 $ 236,158,812 239,563,950 39,790,750 1,790,719 517,304,231 $ 224,080,154 211,161,926 58,901,510 396,312 494,539,902 $ 202,005,781 225,951,240 42,691,134 412,878 471,061,033 $ 189,018,853 225,789,473 47,204,487 473,966 462,486,779 300,620,268 16,636,729 25,550,792 7,788,758 4,674,133 24,325,141 3,470,348 35,200,907 20,227,700 11,339,185 4,449,389 1,282,815 11,977,565 77,176,502 24,793 2,995 544,748,020 (27,443,789) 291,480,509 16,437,777 23,265,654 7,839,167 4,392,803 23,857,513 2,820,123 32,031,887 19,875,107 9,032,684 5,464,771 1,367,078 10,736,383 65,790,820 - 514,392,276 (19,852,374) 276,880,679 13,599,670 12,115,303 5,276,279 3,475,667 21,982,071 2,551,289 29,180,214 15,643,181 8,386,233 3,550,816 828,279 9,783,485 23,264,690 - 426,517,856 44,543,177 281,944,616 14,629,255 15,252,324 5,224,585 3,347,211 21,277,130 2,189,673 30,451,346 16,041,104 6,647,633 5,066,385 895,063 2,446,409 61,373,053 - 466,785,787 (4,299,008) 26,785 734,177 (680,067) 80,895 (27,362,894) 272,220 422,824 (443,137) 251,907 (19,600,467) 85,136 237,682 (258,983) 63,835 44,607,012 202,153 23,805 (23,805) 202,153 (4,096,855) 0.01% 0.01% 0.00% 0.00% 103 2013 2014 Fiscal Year 2015 2016 2017 2018 $ 175,498,829 233,999,813 33,006,129 117,347 442,622,118 $ 169,375,757 253,751,123 38,582,753 113,496 461,823,129 $ 176,820,222 269,909,227 36,702,290 109,660 483,541,399 $ 179,685,236 289,197,140 37,515,504 51,882 506,449,762 $ 181,704,442 291,193,370 36,433,283 92,036 509,423,131 $ 200,878,939 319,741,805 37,197,135 100,189 557,918,068 254,809,048 13,084,577 15,808,070 5,091,545 3,485,599 21,074,910 1,937,246 27,873,512 16,682,505 6,380,546 5,230,988 714,765 1,382,974 94,905,861 - 468,462,146 (25,840,028) 266,021,147 13,185,489 16,298,275 5,608,607 3,001,000 21,960,773 2,222,126 32,036,483 16,898,474 6,886,945 5,306,530 931,815 1,399,265 95,339,820 - 487,096,749 (25,273,620) 282,533,495 14,411,017 19,990,827 5,446,811 4,591,596 23,268,814 2,298,166 36,143,408 18,107,722 12,397,616 8,258,167 1,039,630 1,397,125 32,353,981 - 462,238,375 21,303,024 297,593,226 16,012,830 22,881,631 5,396,294 4,177,527 25,524,904 2,933,303 34,108,053 19,080,749 9,293,813 8,588,846 1,075,451 1,494,408 29,800,758 - 477,961,793 28,487,969 327,145,798 20,197,679 23,812,077 6,159,344 12,966,742 27,683,837 3,604,838 36,488,420 21,200,337 10,372,788 3,940,509 1,113,845 1,460,191 52,344,359 - 548,490,764 (39,067,633) 349,297,606 22,189,095 21,337,798 6,560,431 6,814,406 30,533,898 3,741,693 38,651,167 22,643,896 9,908,575 3,581,968 1,045,682 1,600,553 58,125,878 - 576,032,646 (18,114,578) 89,606 92,200 (92,200) 89,606 (25,750,422) 10,100 304,292 (301,833) 12,559 (25,261,061) 6,379 420,633 (420,633) 6,379 21,309,403 131,514 742,429 (742,429) 131,514 28,619,483 297,610 559,712 (559,712) 297,610 (38,770,023) 56,818 1,159,453 (1,159,453) 56,818 (18,057,760) 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 104 Revenue Capacity Clayton County Public Schools CLAYTON COUNTY BOARD OF EDUCATION ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY LAST TEN FISCAL YEARS (UNAUDITED - IN THOUSANDS) MAINTENANCE AND OPERATIONS Fiscal Year Real & Personal Property Estimated Assessed Actual Value Value Privately Owned Public Utilities Estimated Assessed Actual Value Value Motor Vehicles and Mobile Homes Estimated Assessed Actual Value Value 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Source: Note: Note: $ 7,788,733 $ 19,471,832 $ 1,004,944 $ 2,512,359 $ 740,214 $ 1,850,534 7,549,508 18,873,770 1,007,183 2,517,958 621,749 1,554,373 6,533,685 16,334,212 907,396 2,268,490 621,749 1,554,374 6,126,861 15,317,153 856,786 2,141,965 433,061 1,082,651 5,642,283 14,105,706 872,445 2,181,112 455,950 1,139,876 5,584,027 13,960,067 785,766 1,964,415 494,307 1,235,769 5,660,994 14,152,484 742,662 1,856,656 444,260 1,110,651 5,995,707 14,989,267 800,435 2,001,087 285,638 714,096 6,136,277 15,340,693 668,023 1,670,056 213,851 534,628 6,447,694 16,119,234 722,279 1,805,698 158,451 396,128 Property Tax Division, Clayton County Tax Commission Tax rates are per $1,000 of assessed value. Property in Clayton County is reassessed once every three years. The County assesses property at 40% of actual value for all types of property. Estimated Actual Taxable Value is calculated by dividing Total Taxable Assessed Value by this percentage. 105 Total School Board Estimated Assessed Actual Value Value Taxpayer Exemptions Net Assessed Value Millage Rate Total Tax Levy Assessed Value as a Percentage of Actual Value $ 9,533,891 $ 23,834,725 $ 1,264,115 $ 8,269,776 9,178,440 22,946,101 1,145,096 8,033,344 8,062,830 20,157,076 1,022,513 7,040,317 7,416,708 18,541,769 1,038,686 6,378,022 6,970,678 17,426,694 1,167,967 5,802,711 6,864,100 17,160,251 1,124,912 5,739,188 6,847,916 17,119,791 1,144,443 5,703,473 7,081,780 17,704,450 1,139,208 5,942,572 7,018,151 17,545,377 1,242,150 5,776,001 7,328,424 18,321,060 1,272,098 6,056,326 0.0198 $ 164,039 0.0200 160,667 0.0200 140,806 0.0200 127,560 0.0200 116,054 0.0200 114,784 0.0198 112,952 0.0191 113,473 0.0191 110,293 0.0191 115,646 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 106 CLAYTON COUNTY BOARD OF EDUCATION DIRECT AND OVERLAPPING PROPERTY TAX RATES LAST TEN FISCAL YEARS (RATE PER $1,000 OF ASSESSED VALUE) Fiscal Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 District Direct Rates School Debt M & O Service 19.836 - 19.836 - 20.000 - 20.000 - 20.000 - 20.000 - 20.000 - 19.804 - 19.095 - 19.095 - 19.095 - Total 19.836 19.836 20.000 20.000 20.000 20.000 20.000 19.804 19.095 19.095 19.095 State of Georgia 0.250 0.250 0.250 0.250 0.250 0.200 0.150 0.100 0.050 0.050 - Fiscal Year Overlapping Rates (Continued ) City of Jonesboro City of Fire Lake M & O District City 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1.500 1.500 1.500 1.188 1.500 1.500 1.500 3.900 3.900 - - - - 5.740 5.737 5.737 5.737 7.500 7.500 7.500 7.188 7.550 7.550 7.550 Source: Clayton County Tax Commissioner's Office City of Lovejoy Fire District 3.900 3.900 - - - Overlapping Rates City of College Park City of Forest Park City of Morrow 9.560 9.560 9.560 11.560 11.560 12.619 12.619 12.307 12.619 12.619 12.619 10.343 10.343 12.343 13.343 14.743 14.743 14.743 14.431 14.743 14.743 14.743 5.000 5.000 6.000 6.000 7.500 7.500 9.500 9.188 9.500 9.640 9.370 City of Riverdale 7.500 7.500 7.500 7.500 7.500 9.980 9.980 9.668 9.980 9.980 7.500 M & O Clayton County Board of Commissioners Fire District Total 8.535 8.962 11.436 11.327 15.813 14.912 14.661 14.869 15.862 16.596 16.596 3.900 3.900 4.400 4.400 4.400 5.000 5.000 5.000 5.000 8.535 8.962 15.336 15.227 20.213 19.312 19.061 19.869 20.862 21.596 21.596 107 CLAYTON COUNTY BOARD OF EDUCATION PRINCIPAL PROPERTY TAXPAYERS CURRENT YEAR AND NINE YEARS AGO Taxpayer Calendar Year 2017 Taxable Assessed Value Rank Percent of District's Total Taxable Value (1) Calendar Year 2008 Taxable Assessed Value Rank Percent of District's Total Taxable Value (1) Delta Airlines * $ 650,178,137 1 Georgia Power Company 176,978,982 2 8.87% $ 1,052,745,323 1 2.41% 114,577,982 3 11.04% 1.20% Air Tran Airways - - 0.00% 156,916,487 2 1.65% Clorox Company 38,481,428 8 0.53% - - 0.00% AMB Partners 30,725,776 9 0.42% 53,260,900 6 0.56% Atlanta Gas Light 40,162,506 7 0.55% 33,226,192 9 0.35% BellSouth 73,187,850 4 1.00% 36,017,587 8 0.38% Southwest Airlines City of Atlanta 65,502,844 6 205,607,466 2 0.89% 2.81% - - 92,557,359 4 0.00% 0.97% Fedex Ground - - 0.00% 43,144,568 7 0.45% Atlantic Southeast - - 0.00% 89,682,513 5 0.94% Spirit Airlines 25,899,091 10 0.35% - - 0.00% Southlake Mall American Airlines - - 76,825,552 5 0.00% 1.05% 29,352,522 10 - - 0.31% 0.00% $ 1,383,549,632 17.48% $ 1,701,481,433 17.85% Source: Clayton County Tax Commissioner's Office (1) District's total taxable value for 2017 (fiscal year 2018) $ 7,328,424,037 (2) District's total taxable value for 2008 (fiscal year 2009) $ 9,533,890,115 108 CLAYTON COUNTY BOARD OF EDUCATION PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN TAX YEARS Tax Year Taxes Levied For The Tax Year Collected within the Fiscal Year of the Levy Percentage Amount of Levy Collections in Subsequent Years Total Collections to Date Percentage Amount of Levy 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 $ 161,586,307 164,039,251 161,250,712 140,806,351 127,560,448 116,054,221 114,783,760 112,951,579 113,473,403 110,292,740 115,645,547 $ 158,094,788 159,495,677 156,342,764 134,322,336 121,851,194 111,310,517 110,036,549 108,449,460 110,305,279 105,954,905 111,490,819 97.84% $ 3,070,185 97.23% 4,310,776 96.96% 4,639,719 95.40% 5,776,140 95.52% 4,946,998 95.91% 3,849,292 95.86% 2,036,119 96.01% - 97.21% - 96.07% - 96.41% 6,546,866 $ 161,164,973 163,806,453 160,982,483 140,098,476 126,798,192 115,159,809 112,072,668 108,449,460 110,305,279 105,954,905 118,037,685 99.74% 99.86% 99.83% 99.50% 99.40% 99.23% 97.64% 96.01% 97.21% 96.07% 102.07% Source: Note: Clayton County Tax Commissioner's Office This schedule recognizes collections on a calendar year (tax year) basis, whereas property tax collections reported in the basic financial statements are on a fiscal year basis. 109 CLAYTON COUNTY BOARD OF EDUCATION SCHEDULE OF REVENUES BY SOURCE GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS Revenues: Local sources State sources Federal sources Interest earned on investments On-behalf payments Other sources Total revenues 2009 2010 Fiscal Year 2011 2012 2013 $ 236,387,341 $ 224,080,154 264,830,746 211,161,926 37,089,659 58,901,510 $ 202,005,781 225,951,240 42,691,134 $ 189,018,853 225,789,473 47,204,487 $ 175,498,829 233,999,813 33,006,129 5,534,144 - $ 543,841,890 396,312 - $ 494,539,902 412,878 - $ 471,061,033 473,966 - $ 462,486,779 117,347 - $ 442,622,118 Note: In fiscal year 2008, the School System began reporting On-behalf payments with state sources. 110 2014 2015 Fiscal Year 2016 2017 2018 $ 169,375,757 253,751,123 38,582,753 $ 175,498,829 233,999,813 33,006,129 $ 179,685,236 289,387,310 37,515,504 $ 181,704,442 291,193,370 36,433,283 $ 200,878,939 319,741,805 37,197,135 113,496 - $ 461,823,129 117,347 - $ 442,622,118 51,882 - $ 506,639,932 92,036 - $ 509,423,131 100,189 - $ 557,918,068 111 Debt Capacity Clayton County Public Schools CLAYTON COUNTY BOARD OF EDUCATION RATIOS OF OUTSTANDING DEBT BY TYPE LAST TEN FISCAL YEARS Fiscal Year Ended June 30, 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Capital Lease - General Obligation Bonds - Notes: *See Schedule of Demographic and Economic Statistics Total Primary Government - Percentage of Personal Income* 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Per Capita* - 112 CLAYTON COUNTY BOARD OF EDUCATION DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT AS OF JUNE 30, 2018 Direct Debt Clayton County Board of Education Overlapping Debt Clayton County Landfill Authority Total Direct and Overlapping Debt Estimated Outstanding Debt Percentage Applicable to Clayton County Board of Education Amount Applicable to Clayton County Board of Education $ - - $ - 39,435,000 7,180,000 $ 46,615,000 100% 100% $ 39,435,000 7,180,000 46,615,000 Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the School System. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses within the School System's boundaries. This process recognizes that, when considering the School System's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident and, therefore, responsible for repaying the debt of each overlapping government. The percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated by determining the portion of the county/authority's taxable assessed value that is within the School System's boundaries and dividing it by the county/authority's total taxable assessed value. Source: Clayton County Board of Education and Clayton County Board of Commissioners 113 CLAYTON COUNTY BOARD OF EDUCATION LEGAL DEBT MARGIN INFORMATION LAST TEN FISCAL YEARS Debt limit Total net debt applicable to limit Legal debt margin Total net debt applicable to the limit as a percentage of debt limit 2009 $ 1,633,421,200 $ 1,633,421,200 0.00% 2010 $ 1,531,715,300 $ 1,531,715,300 0.00% Fiscal Year 2011 $ 1,410,570,600 - $ 1,410,570,600 0.00% 2012 $ 1,396,006,700 $ 1,396,006,700 0.00% 2013 $ 697,067,800 $ 697,067,800 0.00% 114 2014 $ 686,097,000 $ 686,097,000 2015 $ 684,791,600 $ 684,791,600 Fiscal Year 2016 $ 708,178,000 - $ 708,178,000 2017 $ 701,815,100 $ 701,815,100 2018 $ 732,842,404 $ 732,842,404 0.00% 0.00% 0.00% 0.00% 0.00% Legal Debt Margin Calculation for Fiscal Year 2018 Assessed Value Debt Limit (10% of assessed value) Debt applicable to limit: General obligation bonds Total net debt applicable to limit Legal debt margin $ 7,328,424,040 732,842,404 $ 732,842,404 115 Demographic & Economic Information Clayton County Public Schools CLAYTON COUNTY BOARD OF EDUCATION DEMOGRAPHIC AND ECONOMIC STATISTICS LAST TEN FISCAL YEARS Year 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Population 275,580 277,463 279,580 267,180 269,610 272,600 270,640 274,070 280,830 285,030 Personal Income* (in thousands) 5,960,557 6,140,280 6,274,560 6,551,330 6,551,720 7,157,660 6,936,580 6,728,520 6,857,750 7,163,220 * Woods & Poole Economics Data Pamphlet ** Georgia Department of Labor/Clayton County Chamber of Commerce Per Capita Personal Income 21,629 22,130 22,443 24,520 24,301 26,257 25,630 24,550 24,420 25,131 County Unemployment Rate** 12.5% 12.3% 13.0% 11.5% 11.0% 9.4% 7.9% 6.6% 6.2% 5.0% 116 CLAYTON COUNTY BOARD OF EDUCATION PRINCIPAL EMPLOYERS CURRENT YEAR AND NINE YEARS AGO Taxpayer Clayton County School System Clayton County Board of Commissioners Gate Gourmet Inc. Southern Regional Medical Center FedEx Ground Fresh Express, Inc. FedEx Ground Walmart Super Center TOTO USA, Inc. Standard Parking Corporation R + L Carriers, Inc. Clayton State University Kroger Totals Number of Employees 7,000 2,550 1,200 1,100 800 800 700 675 562 530 15,917 2017 Rank 1 2 3 4 5 6 7 8 9 10 - Percent of Total County Employment Number of Employees 4.26% 7,400 1.55% 2,640 0.73% 1,710 0.67% 1,200 0.49% 800 0.46% 900 0.49% - 0.00% 825 0.41% 700 0.34% - 0.32% - 0.00% 675 0.00% 579 9.68% 17,429 2008 Rank 1 2 3 4 7 5 6 8 9 10 Percent of Total County Employment 4.50% 1.61% 1.04% 0.73% 0.49% 0.55% 0.00% 0.50% 0.43% 0.00% 0.00% 0.41% 0.35% 10.61% Source: 2017- Clayton County Office of Economic Development. 2008 - Clayton County Chamber of Commerce. Note: Total employment in Clayton County for 2017 was 176,470 and in 2008 was 149,841. (Woods & Poole Economic Data Pamphlet 2008 and 2017). 117 CLAYTON COUNTY BOARD OF EDUCATION STUDENT ETHNICITY STATISTICS LAST TEN FISCAL YEARS Gender Race Female American Indian/Alaskan Native Asian, Pacific Islander Black, not of Hispanic origin Hispanic Multi-racial White, not of Hispanic origin Sub Total 2009 18 1,030 17,387 3,582 904 1,043 23,964 2010 56 1,153 17,454 4,116 741 932 24,452 2011 47 1,159 17,667 4,399 744 844 24,860 2012 62 1,151 17,720 4,347 732 813 24,825 2013 43 1,162 17,876 4,616 740 792 25,229 Male American Indian/Alaskan Native Asian, Pacific Islander Black, not of Hispanic origin Hispanic Multi-racial White, not of Hispanic origin Sub Total System Total 30 1,147 18,514 3,736 938 1,179 25,544 49,508 55 1,213 18,411 4,256 767 1,050 25,752 50,204 56 1,228 18,708 4,545 702 919 26,158 51,018 65 1,222 18,548 4,524 686 895 25,940 50,765 58 1,242 18,768 4,868 678 914 26,528 51,757 Source: Georgia Department of Education Website 118 2014 41 1,082 17,785 4,962 711 756 25,337 2015 46 1,101 18,150 5,225 757 727 26,006 2016 1,073 18,448 5,498 726 674 26,419 2017 43 1,022 18,614 5,661 706 638 26,684 2018 48 1,018 18,719 5,891 699 527 26,902 50 1,174 18,848 5,126 673 822 26,693 52,030 49 1,155 19,236 5,435 666 820 27,361 53,367 52 1,159 19,425 5,599 682 754 27,671 54,090 52 1,149 19,317 5,805 648 690 27,661 54,345 56 1,083 19,019 5,891 644 620 27,313 54,215 119 Operating Information Clayton County Public Schools Year Ended June 30, 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 CLAYTON COUNTY BOARD OF EDUCATION STUDENT ENROLLMENT STATISTICS LAST TEN YEARS Average Daily Membership 48,945 49,474 49,474 50,663 51,154 51,962 53,078 53,822 49,511 54,254 Average Daily Attendance 46,478 47,111 47,917 48,500 48,899 49,416 50,358 50,995 49,416 51,274 Attendance Percentage 94.96% 95.22% 96.85% 95.73% 95.59% 95.10% 94.88% 94.75% 99.81% 94.51% Official State October 1 Enrollment Count 49,508 50,204 50,366 51,018 51,757 52,296 53,367 54,136 54,345 54,530 120 Fiscal Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 CLAYTON COUNTY BOARD OF EDUCATION TEACHERS' BASE SALARIES LAST TEN FISCAL YEARS Minimum Salary $ 39,809 $ 40,624 $ 40,624 $ 39,555 $ 39,555 $ 39,555 $ 39,555 $ 40,742 $ 40,962 $ 43,517 $ 44,387 Median Salary $ 59,635 $ 61,527 $ 61,452 $ 59,908 $ 59,908 $ 59,908 $ 59,908 $ 61,705 $ 62,039 $ 66,408 $ 67,736 Maximum Salary $ 79,461 $ 82,430 $ 82,280 $ 80,261 $ 80,261 $ 80,261 $ 80,261 $ 82,669 $ 83,116 $ 89,299 $ 91,085 Percent Change 6.29% 3.74% -0.18% -2.45% 0.00% 0.00% 0.00% 3.00% 0.54% 7.44% 2.00% 121 CLAYTON COUNTY BOARD OF EDUCATION HISTORY OF HIGH SCHOOL GRADUATES LAST TEN SCHOOL YEARS School Year Drew High Forest Park High Jonesboro High Lovejoy High Morrow High Mount Zion High Mundy's Mill High North Clayton High Riverdale High Alternative Programs Total 2009 - 230 271 361 316 238 355 215 294 234 2,514 2010 - 218 214 297 284 240 305 225 293 279 2,355 2011 34 264 229 365 332 352 375 216 309 34 2,510 2012 251 307 201 389 283 258 329 175 209 251 2,653 2013 275 230 254 335 276 253 300 125 188 168 2,404 2014 284 279 256 371 304 288 336 140 235 44 2,537 2015 250 292 279 398 369 244 382 151 242 100 2,707 2016 269 347 264 385 343 199 352 162 272 137 2,730 2017 271 329 267 378 383 259 335 170 283 160 2,835 2018 239 304 238 306 326 214 289 138 217 - 2,271 122 CLAYTON COUNTY BOARD OF EDUCATION RATIO OF PUPILS TO PROFESSIONAL PERSONNEL LAST TEN FISCAL YEARS Fiscal Year 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Classroom Teachers (1) 3,819 3,576 3,412 3,127 3,011 3,045 3,096 3,135 3,282 2,841 Support Personnel (2) 3,482 3,159 2,917 2,816 2,703 2,641 3,080 3,101 3,114 3,042 Administrators (3) 215 219 209 199 199 218 239 241 244 255 Total Personnel 7,516 6,954 6,538 6,142 5,913 5,904 6,415 6,477 6,640 6,138 Average Daily Enrollment 46,478 49,475 47,917 47,879 51,154 51,962 53,078 53,822 54,530 54,840 Ratio of Pupils to Classroom Teachers 12.2 13.8 14.0 15.3 17.0 17.1 17.1 17.2 16.6 19.3 Notes: (1) Classroom Teachers- All Teachers, certified and non-certified. (2) Support Personnel- Includes Media Specialist, Counselors, Clerical, Paraprofessionals, Custodians, Maintenance, Transportation, Nutritional Services and other Support Personnel. (3) Administrators - Includes the Superintendent, Asst. Superintendents, Principals, Asst. Principals, Directors, Coordinators and Instructional Supervisors. 123 Fiscal Year 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 CLAYTON COUNTY BOARD OF EDUCATION COST PER PUPIL ENROLLED LAST TEN FISCAL YEARS Expenditures $ 496,759,613 458,871,577 420,189,484 426,175,715 394,426,873 425,016,774 409,173,771 428,809,990 478,353,853 462,514,460 Average Daily Enrollment 46,478 47,111 47,917 50,663 51,154 51,962 50,358 50,995 54,530 54,840 Cost Per Pupil Enrolled $ 10,688 9,740 8,769 8,412 7,711 8,179 8,125 8,409 8,772 8,434 Percentage of Change 9.03% -8.87% -9.97% -4.07% -8.34% 6.08% -0.66% 3.49% 4.32% -3.86% 124 CLAYTON COUNTY BOARD OF EDUCATION NUTRITION SERVICES - FACTS AND FIGURES LAST TEN FISCAL YEARS Number of schools participating in: Lunch - regular schedule Lunch - year round Breakfast program Student lunches served: Free Reduced Fully paid Total Adult lunches served Student breakfasts served: Free Reduced Fully paid Total Number of serving days: Regular schedule Year-round schedule Weighted average Average daily participation: Student lunch Adult lunch Student breakfast October 1 pupil count (Kindergarten not included) Percentage of students daily eating school lunch October 1 count of benefits Students on free lunch Student on reduced lunch Percentage of students on: Free lunch Reduced lunch Total 2009 2010 Fiscal Year 2011 2012 2013 60 61 61 60 60 - - - 1 1 60 61 61 61 61 5,163,769 793,806 1,198,349 7,155,924 337,667 5,523,779 683,265 1,007,164 7,214,208 300,910 5,742,787 501,529 910,669 7,154,985 248,644 5,998,933 557,755 811,167 7,367,855 165,504 6,177,665 514,819 634,576 7,327,060 131,968 2,611,826 299,277 322,811 3,233,914 2,766,691 271,852 285,175 3,323,718 2,855,986 213,274 263,094 3,332,354 3,098,269 247,560 246,104 3,591,933 3,153,544 230,084 192,917 3,576,545 185 - 185.00 179 - 179.00 175 - 175.00 175 175 175.00 175 175 175.00 38,681 1,825 17,481 40,303 1,681 18,568 40,886 1,421 19,042 42,102 946 20,525 41,869 754 20,437 45,399 45,579 50,366 46,734 46,622 85.20% 88.42% 81.18% 90.09% 89.81% 32,807 5,459 37,773 3,746 38,395 3,896 38,911 3,691 40,087 3,660 72.26% 12.02% 84.29% 82.87% 8.22% 91.09% 76.23% 7.74% 83.97% 83.26% 7.90% 91.16% 85.98% 7.85% 93.83% 125 2014 2015 Fiscal Year 2016 2017 2018 60 60 1 - 61 61 61 61 63 - 1 1 62 62 63 7,169,629 - 337,191 7,506,820 129,971 7,475,564 - 352,431 7,827,995 134,748 7,899,049 - 39,743 7,938,792 135,865 7,970,433 - 40,049 8,010,482 136,390 7,482,638 35,208 7,517,846 116,190 3,862,794 - 183,478 4,046,272 4,150,647 - 195,883 4,346,530 4,446,771 - 22,345 4,469,116 4,487,951 - 22,550 4,510,501 4,363,959 - 20,546 4,384,505 175 175 175.00 175 - 175.00 176 - 176.00 175 - 172.18 194 174 193.69 42,896 743 23,122 44,731 770 24,837 45,090 3,754 25,503 44,486 4,219 25,156 43,120 599 25,277 46,992 48,344 48,809 49,782 54,962 91.28% 92.53% 92.38% 89.36% 78.45% 44,877 2,115 48,344 - 48,809 - 49,782 - 52,491 2,471 95.50% 4.50% 100.00% 100.00% 0.00% 100.00% 100.00% 0.00% 100.00% 100.00% 0.00% 100.00% 95.50% 4.50% 100.00% 126 CLAYTON COUNTY BOARD OF EDUCATION SCHOOL BUILDING INFORMATION LAST TEN FISCAL YEARS School Elementary Anderson (1971) Square feet Capacity Enrollment Arnold (1963) Square feet Capacity Enrollment Brown (1975) Square feet Capacity Enrollment Callaway (2002) Square feet Capacity Enrollment Church St (1966) Square feet Capacity Enrollment East Clayton (1958) Square feet Capacity Enrollment Edmonds (1957) Square feet Capacity Enrollment Fountain (1952) Square feet Capacity Enrollment Harper (2002) Square feet Capacity Enrollment 2009 2010 2011 2012 Fiscal Year 2013 2014 2015 2016 2017 2018 54,221 450 482 54,221 450 497 54,221 450 490 54,221 450 496 56,176 450 496 56,176 450 554 56,680 450 552 56,680 450 552 56,680 450 587 56,680 450 566 57,177 500 469 57,177 500 477 57,177 500 481 57,177 500 460 57,177 500 489 57,177 500 518 59,638 500 529 59,638 500 529 5,938 500 541 59,638 500 573 81,615 750 745 81,615 750 789 81,615 750 790 81,615 750 881 81,615 750 760 81,615 750 784 80,547 750 822 80,547 750 822 80,547 750 833 80,547 750 802 105,494 900 844 105,494 900 855 105,494 900 816 105,494 900 792 105,494 900 806 105,494 900 848 104,889 900 886 104,889 900 886 104,889 900 895 104,889 900 853 78,651 825 868 78,651 825 832 78,651 825 817 78,651 825 886 78,651 825 904 78,651 825 890 79,913 825 967 79,913 825 967 79,913 825 978 79,913 825 835 68,818 650 615 68,818 650 632 68,818 650 608 68,818 650 578 68,818 650 625 68,818 650 621 68,818 650 624 68,818 650 624 68,818 650 585 120,091 900 618 57,307 450 560 57,307 450 587 57,307 450 547 57,307 450 610 57,307 450 576 57,307 450 590 58,191 450 582 58,191 450 582 58,191 450 587 58,191 450 540 68,965 650 549 68,965 650 626 68,965 650 553 68,965 650 597 68,965 650 600 77,648 650 634 77,648 650 652 77,648 650 652 77,648 650 634 77,648 650 612 91,014 725 728 91,014 725 812 105,994 900 810 105,994 900 902 105,994 900 920 107,701 900 876 106,854 900 914 106,854 900 914 106,854 900 827 106,854 900 898 (Continued) Note: "X" represents the year the building did not exist. 127 CLAYTON COUNTY BOARD OF EDUCATION SCHOOL BUILDING INFORMATION LAST TEN FISCAL YEARS School (Continued) Hawthorne (1998) Square feet Capacity Enrollment Haynie (1969) Square feet Capacity Enrollment Hendrix (1955) Square feet Capacity Enrollment Huie (1966) Square feet Capacity Enrollment Jackson (2003) Square feet Capacity Enrollment K. R Peace (2018) Square feet Capacity Enrollment Kemp (1981) Square feet Capacity Enrollment Kemp Primary (2004) Square feet Capacity Enrollment Kilpatrick (1973) Square feet Capacity Enrollment King (2003) Square feet Capacity Enrollment Lake City (1957) Square feet Capacity Enrollment Lake Ridge (1994) Square feet Capacity Enrollment 2009 2010 2011 2012 Fiscal Year 2013 2014 2015 2016 2017 2018 102,500 900 943 102,500 900 964 102,500 900 950 102,500 900 983 102,500 900 982 102,500 900 893 103,289 900 962 103,289 900 962 103,289 900 962 103,289 900 914 72,107 738 712 72,107 738 663 72,107 738 681 72,107 737 761 72,332 768 872 72,332 750 872 71,746 750 905 71,746 750 905 71,746 750 905 71,746 750 928 54,748 54,748 54,748 X X X X X X X 450 450 450 - - - - - - - 119 27 27 - - - - - - - 71,569 675 655 71,569 675 658 71,569 675 614 71,569 675 717 71,569 675 705 71,569 675 717 71,081 675 789 71,081 675 789 71,081 675 789 71,081 675 792 90,229 900 736 90,229 900 882 90,229 900 837 105,209 900 914 105,209 968 1,023 105,209 900 979 104,841 900 1,074 104,841 900 1,074 104,841 900 1,074 104,841 900 636 X X X X X X X X X 40,065 - - - - - - - - - 475 - - - - - - - - - 473 71,882 850 718 71,882 850 699 71,882 850 689 71,882 850 711 71,882 650 689 71,882 850 669 74,068 850 673 74,068 850 673 74,068 850 673 74,068 850 664 90,229 663 718 90,229 663 693 90,229 650 624 90,229 650 711 90,229 650 711 91,014 650 667 90,065 650 682 90,065 650 682 90,065 650 682 90,065 650 674 75,379 650 562 75,379 650 611 75,379 650 606 75,379 650 621 75,379 650 633 75,379 650 679 72,260 650 720 72,260 650 720 72,260 650 720 72,260 650 743 92,044 700 906 92,044 700 957 92,044 700 935 92,044 700 957 92,044 700 1,014 92,044 700 1,039 91,852 700 1,048 91,852 700 1,048 91,852 700 1,048 91,852 700 623 51,245 463 510 51,245 463 535 51,245 463 516 51,245 462 540 51,245 462 539 59,153 450 548 58,642 450 553 58,642 450 553 58,642 450 553 58,642 450 583 94,662 650 750 94,662 788 730 94,662 788 694 94,662 788 728 94,662 788 726 94,662 800 678 94,138 800 658 94,138 800 658 94,138 800 658 94,138 800 648 (Continued) Note: "X" represents the year the building did not exist. 128 CLAYTON COUNTY BOARD OF EDUCATION SCHOOL BUILDING INFORMATION LAST TEN FISCAL YEARS 2009 2010 School (Continued) Lee St (1960) Square feet 54,220 54,220 Capacity 500 500 Enrollment 596 562 Marshall (2004) Square feet 89,854 89,854 Capacity 725 725 Enrollment 826 828 McGarrah (1967) Square feet 73,782 73,782 Capacity 750 750 Enrollment 621 641 Morrow (1952) Square feet 54,382 54,382 Capacity 450 450 Enrollment 515 505 Mt Zion (1976) Square feet 85,815 85,815 Capacity 700 700 Enrollment 550 575 Mt Zion Primary (2008) Square feet 93,275 93,275 Capacity 750 750 Enrollment 548 660 Northcutt (1970) Square feet 78,013 78,013 Capacity 750 750 Enrollment 658 699 Oliver (1976) Square feet 67,194 67,194 Capacity 675 675 Enrollment 739 664 Pointe South (1981) Square feet 57,441 57,441 Capacity 675 675 Enrollment 697 674 River's Edge (1994) Square feet 100,300 100,300 Capacity 863 863 Enrollment 1,142 604 Riverdale (1954) Square feet 65,084 65,084 Capacity 700 700 Enrollment 606 669 Riverdale (2013) Square feet X X Capacity - - Enrollment - - Smith (2000) Square feet 109,612 109,612 Capacity 900 900 Enrollment 938 871 Suder (1966) Square feet 79,783 79,783 Capacity 775 765 Enrollment 683 665 (Continued) Note: "X" represents the year the building did not exist. 2011 54,220 500 509 89,854 725 818 73,782 750 631 54,382 450 467 85,815 700 589 93,275 750 629 78,013 750 686 67,194 675 672 57,441 675 662 100,300 863 573 65,084 700 643 X - 109,612 900 851 79,783 765 640 2012 Fiscal Year 2013 2014 54,220 500 555 54,220 500 589 54,220 500 640 89,854 725 833 89,854 725 861 90,174 725 909 73,782 750 670 74,837 750 711 74,787 750 692 54,382 450 478 54,382 450 478 54,382 450 482 85,815 700 569 85,815 700 572 85,815 700 615 93,275 750 689 93,275 750 686 93,275 750 639 78,013 750 648 79,394 750 648 79,394 750 632 67,194 675 613 67,194 675 613 67,194 675 633 57,441 675 697 57,441 675 703 57,441 675 637 100,820 863 596 100,820 863 607 100,280 850 566 65,084 65,084 X 700 700 - 643 663 - X - 109,612 900 930 X - 109,612 900 957 108,324 800 613 109,716 900 953 79,783 765 694 79,783 765 736 79,783 775 705 129 2015 54,101 500 677 90,174 725 917 74,729 750 713 61,950 450 533 76,503 700 646 93,205 750 641 77,030 750 633 75,187 675 642 57,441 675 726 101,094 850 634 X - 108,324 800 684 11,065 900 969 82,493 775 719 2016 54,101 500 677 90,174 725 917 74,729 750 713 61,950 450 533 76,503 700 646 93,205 750 641 77,030 750 663 75,187 675 642 57,441 675 726 101,094 850 634 X - 108,324 800 684 110,065 900 969 82,493 775 719 2017 54,101 500 684 90,174 725 - 74,729 750 - 61,950 450 564 76,503 700 718 93,205 750 647 77,030 750 625 75,187 675 615 57,441 675 680 101,094 850 637 X - 108,324 800 676 110,065 900 962 82,493 775 742 2018 54,101 500 620 90,174 725 870 74,729 750 690 61,950 450 545 76,503 700 624 93,205 750 654 77,030 750 625 75,187 675 670 57,441 675 636 101,094 850 681 X - 108,324 800 776 110,065 900 982 82,493 775 698 CLAYTON COUNTY BOARD OF EDUCATION SCHOOL BUILDING INFORMATION LAST TEN FISCAL YEARS School (Continued) Elementary Swint (1968) Square feet Capacity Enrollment Tara (1964) Square feet Capacity Enrollment Unidos Charter (Hendrix) Square feet Capacity Enrollment West Clayton (1964) Square feet Capacity Enrollment White Academy (2010) Square feet Capacity Enrollment Middle Adamson (1977) Square feet Capacity Enrollment Babb (1966) Square feet Capacity Enrollment Forest Park (1940) Square feet Capacity Enrollment Jonesboro (2004) Square feet Capacity Enrollment Kendrick (1996) Square feet Capacity Enrollment Lovejoy (1990) Square feet Capacity Enrollment Morrow #7 (2012) Square feet Capacity Enrollment (Continued) 2009 2010 2011 2012 Fiscal Year 2013 2014 2015 2016 2017 2018 71,785 788 571 71,785 776 642 71,785 776 605 71,785 776 639 72,665 776 598 72,665 750 596 76,899 750 670 76,899 750 670 76,899 750 672 76,899 750 747 76,224 735 667 76,224 725 601 76,224 725 547 76,224 725 725 76,224 725 662 83,111 725 662 88,155 725 709 88,155 725 709 88,155 725 700 88,155 725 730 76,224 735 667 76,224 725 601 76,224 725 547 54,748 450 491 54,748 450 577 54,748 450 676 56,278 450 800 56,278 450 800 56,278 450 662 56,278 450 461 66,917 600 510 66,917 600 462 66,917 600 436 66,917 600 444 66,917 600 468 66,917 600 503 66,159 600 593 66,159 600 593 66,159 600 578 66,159 600 599 X 201,679 201,679 201,679 201,679 210,679 205,143 205,143 205,143 205,143 - 1,425 1,425 1,425 1,425 1,425 1,425 1,425 1,425 1,425 - - 1,414 1,410 1,381 1,444 1,398 1,398 1,425 1,501 120,015 775 656 120,015 775 658 120,015 775 649 120,015 775 617 120,015 775 604 120,015 775 594 113,033 775 596 113,033 775 596 113,033 775 603 113,033 775 568 103,443 775 783 103,443 775 766 103,443 775 796 103,443 775 755 103,443 775 808 103,443 775 831 106,596 775 844 106,596 775 844 106,596 775 866 106,596 775 1,027 84,964 570 510 84,964 600 674 84,964 600 683 84,964 600 703 85,894 600 680 85,884 600 663 94,677 600 650 94,677 600 650 94,677 600 659 94,677 600 700 128,170 875 834 128,170 875 743 128,170 875 753 128,170 875 794 128,170 875 869 128,170 875 853 128,188 875 853 128,188 875 883 128,188 875 901 128,188 875 1,010 143,724 1,100 787 143,724 1,100 852 143,828 1,100 883 143,724 1,100 847 143,724 1,100 820 143,724 1,100 777 144,359 1,100 731 144,359 1,100 731 144,359 1,100 789 144,359 1,100 794 123,731 738 1,172 123,731 725 584 123,731 725 578 123,731 725 586 125,567 725 663 125,567 725 659 121,041 725 581 121,041 725 581 121,041 725 551 121,041 725 536 X 171,727 171,727 171,727 171,727 174,539 174,539 174,539 174,539 174,539 - 900 900 900 1,200 900 900 900 900 900 - 803 742 756 695 683 755 755 789 957 Note: "X" represents the year the building did not exist. 130 CLAYTON COUNTY BOARD OF EDUCATION SCHOOL BUILDING INFORMATION LAST TEN FISCAL YEARS School (Continued) Middle Old Morrow - Elite (1967) Square feet Capacity Enrollment Mundy's Mill (1973) Square feet Capacity Enrollment N. Clayton Middle (1969) Square feet Capacity Enrollment Pointe South (1978) Square feet Capacity Enrollment Rex Mill (2007) Square feet Capacity Enrollment Riverdale (1968) Square feet Capacity Enrollment Roberts (2000) Square feet Capacity Enrollment Sequoyah (2004) Square feet Capacity Enrollment 2009 2010 2011 2012 Fiscal Year 2013 2014 2015 2016 2017 2018 96,109 96,109 96,109 96,109 96,109 96,525 97,525 97,525 - - 650 650 650 650 650 650 650 650 - - 681 725 737 376 424 495 597 597 - - 116,822 850 869 116,822 850 804 116,822 850 818 116,822 850 823 116,822 850 798 116,822 850 809 121,761 850 793 121,761 850 793 121,761 850 773 121,761 850 827 126,179 738 920 126,179 738 843 126,179 1,000 860 126,179 1,000 808 118,255 1,000 813 126,179 1,000 858 126,128 1,000 824 126,128 1,000 824 126,128 1,000 797 126,128 1,000 873 141,792 875 803 141,792 875 822 160,835 925 838 160,835 925 844 160,835 925 873 160,835 925 836 137,106 925 795 137,106 925 795 137,106 925 859 137,106 925 846 152,570 1,100 953 152,570 1,100 1,035 152,570 1,100 1,042 152,570 1,100 1,094 152,570 1,100 1,131 152,570 1,100 1,108 146,303 1,100 1,025 146,303 1,100 1,025 146,303 1,100 1,095 146,303 1,100 1,132 108,738 850 833 108,738 850 741 139,581 850 752 108,738 850 779 139,581 850 760 123,470 850 712 125,047 850 690 125,047 850 690 125,047 850 684 125,047 850 779 146,007 1,100 649 146,007 1,100 699 146,007 1,100 667 146,007 1,100 675 146,007 1,100 737 146,007 1,100 789 210,431 1,350 894 210,431 1,350 894 210,431 1,350 964 210,431 1,350 967 128,170 875 737 128,170 875 808 128,170 875 804 128,170 875 885 128,170 875 876 128,170 875 866 128,188 875 922 128,188 875 922 128,188 875 866 128,188 875 863 (Continued) Note: "X" represents the year the building did not exist. 131 CLAYTON COUNTY BOARD OF EDUCATION SCHOOL BUILDING INFORMATION LAST TEN FISCAL YEARS 2009 School (Continued) High Drew (2009) Square feet 297,918 Capacity 1,850 Enrollment - Forest Park (1962) Square feet 206,766 Capacity 1,550 Enrollment 1,518 Jonesboro (1963) Square feet 208,036 Capacity 1,500 Enrollment 1,153 Lovejoy (1989) Square feet 217,450 Capacity 1,625 Enrollment 1,662 Morrow (1970) Square feet 183,836 Capacity 1,375 Enrollment 1,534 Mt. Zion (1990) Square feet 216,241 Capacity 1,350 Enrollment 1,547 Mundy's Mill (2002) Square feet 292,512 Capacity 1,850 Enrollment 1,659 N. Clayton (1967) Square feet 194,138 Capacity 1,325 Enrollment 1,360 Perry Learning Center (1952) Square feet X Capacity - Enrollment - Riverdale (1977) Square feet 203,067 Capacity 1,325 Enrollment 1,532 M E Stilwell Square feet X Capacity - Enrollment - Elite Scholars Academy (2017) Square feet X Capacity - Enrollment - 2010 297,918 1,850 1,132 206,766 1,550 1,626 208,036 1,500 1,212 231,852 1,850 1,815 183,836 1,375 1,722 231,952 1,575 1,563 292,512 1,850 1,629 194,138 1,325 1,068 X - 203,067 1,325 1,053 X - X - 2011 297,918 1,850 1,182 227,356 1,550 1,643 208,036 1,725 1,235 231,852 1,850 1,894 183,836 1,375 1,819 231,952 1,575 1,580 292,512 1,850 1,719 194,138 1,325 1,118 X - 203,067 1,325 1,416 X - X - 2012 297,918 1,850 1,594 227,356 1,550 1,651 227,131 1,725 1,311 231,852 1,850 1,978 183,836 1,375 1,762 231,952 1,575 1,570 292,512 1,850 1,706 211,657 1,325 899 X - 203,067 1,325 1,237 X - X - Fiscal Year 2013 2014 308,859 1,850 1,589 318,859 1,850 1,555 227,356 1,550 1,710 227,356 1,550 1,742 228,157 1,725 1,372 228,157 1,725 1,319 231,853 1,850 2,000 231,853 1,850 2,044 183,836 1,375 1,728 196,640 1,900 1,737 233,593 1,575 1,804 233,593 1,575 1,639 313,882 1,850 1,695 313,882 1,850 1,718 211,657 1,325 848 211,657 1,100 846 X X - - - - 203,067 1,325 1,303 203,067 1,325 1,393 X X - - - - X X - - - - 2015 2016 317,251 1,850 1,593 317,251 1,850 1,593 235,481 1,550 1,742 235,481 1,550 1,752 217,468 1,725 1,289 217,468 1,725 1,289 231,706 1,850 1,992 231,706 1,850 1,992 195,537 1,900 1,990 195,537 1,900 1,990 230,925 1,575 1,283 230,925 1,575 1,283 313,882 1,850 1,757 313,882 1,850 1,757 188,824 1,100 890 188,824 1,100 890 X X - - - - 177,821 1,325 1,342 177,821 1,325 1,342 133,195 825 542 133,195 825 542 X X - - - - 2017 317,251 1,850 1,620 235,481 1,550 1,834 217,468 1,725 1,376 231,706 1,850 1,913 195,537 1,900 2,051 230,925 1,575 1,376 313,882 1,850 1,750 188,824 1,100 876 X - 177,821 1,325 1,320 133,195 825 605 X - 2018 317,251 1,850 1,555 235,481 1,550 1,666 217,468 1,725 1,388 231,706 1,850 1,819 195,537 1,900 1,771 230,925 1,575 1,307 313,882 1,850 1,691 188,824 1,100 1,163 130,755 900 934 177,821 1,325 1,206 133,195 825 597 128,721 700 664 (Concluded) Note: "X" represents the year the building did not exist. 132 Single Audit Section Clayton County Public Schools 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 To the Superintendent and Members of the Clayton County Board of Education Jonesboro, Georgia 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, the business-type activities, each major fund, and the aggregate remaining fund information of Clayton County Board of Education as of and for the year ended June 30, 2018, and the related notes to the financial statements, which collectively comprise Clayton County Board of Education's basic financial statements and have issued our report thereon dated January 31, 2020. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered Clayton County Board of Education'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 Clayton County Board of Education's internal control. Accordingly, we do not express an opinion on the effectiveness of Clayton County Board of Education's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. 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. 300 MULBERRY STREET, SUITE 300 POST OFFICE BOX 1877 MACON, GEORGIA 31202-1877 478-464-8000 FAX 478-464-8051 www.mjcpa.com MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS Compliance and Other Matters As part of obtaining reasonable assurance about whether Clayton County Board of Education'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 Clayton County Board of Education'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 entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Macon, Georgia January 31, 2020 134 INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE To the Superintendent and Members of the Clayton County Board of Education Jonesboro, Georgia Report on Compliance for Each Major Federal Program We have audited Clayton County Board of Education's compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of Clayton County Board of Education's major federal programs for the year ended June 30, 2018. Clayton County Board of Education'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 the requirements of 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 Clayton County Board of Education'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 Clayton County Board of Education'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 Clayton County Board of Education's compliance. 300 MULBERRY STREET, SUITE 300 POST OFFICE BOX 1877 MACON, GEORGIA 31202-1877 478-464-8000 FAX 478-464-8051 www.mjcpa.com MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS Opinion on Each Major Federal Program In our opinion, Clayton County Board of Education complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2018. Report on Internal Control Over Compliance Management of Clayton County Board of Education 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 Clayton County Board of Education'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 Clayton County Board of Education'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. 136 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. Macon, Georgia January 31, 2020 137 CLAYTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 Federal Grantor/Pass-Through Grantor/Program Title Passed through Georgia Department of Education: Child Nutrition Cluster School Breakfast Program National School Snack Program Total Child Nutrition Cluster Passed through Georgia Department of Education Child Nutrition Discretionary Grants Limited Availability Fresh Fruits and Vegetables Total U.S. Department of Agriculture U.S. DEPARTMENT OF EDUCATION Passed through Georgia Department of Technical and Adult Education: Adult Education Passed through Georgia Department of Education Title I Programs - Improving Academic Achievement Title IV-B, Special Education Cluster Title VI-B Flowthrough Title VI-B Preschool Total Title IV-B, Special Education Cluster Title II - Supporting Effective Instruction Title III - Limited English Proficient (Continued) N/A - Not available/applicable Federal CFDA Number Pass-Through Entity ID Number Total Expenditures 10.553 10.555 10.579 10.582 18185GA324N1099 18185GA324N1100 $ 9,126,844 27,848,315 36,975,159 16163GA350N8103 16145GA324L1603 35,000 253,064 37,263,223 84.002 84.010 84.027 84.173 84.367 84.365 N/A S010A170010 H027A170073 H173A170081 S367A170001 S365A170010 512,654 22,784,666 9,179,490 352,197 9,531,687 1,494,378 667,334 138 CLAYTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 Federal Grantor/Pass-Through Grantor/Program Title U.S. DEPARTMENT OF EDUCATION (CONTINUED) Passed through Georgia Department of Education (Continued): Title IV - Student Support and Academic Enrichment Engaging Minds Education for Homeless Children and Youth Vocational Education - Basic Grants to States Program Improvement Subtotal - Passed through Georgia Department of Education Passed through Georgia State University Research Foundation Collaboration and Resources for Encouraging and Supporting Transformations in Education Passed through Georgia Institute of Technology Gear Up Georgia Federal CFDA Number 84.424 84.351C 84.196 84.048 84.336 84.334S Total U.S. Department of Education U.S. DEPARTMENT OF DEFENSE Direct Award: ROTC U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES Passed through Georgia Department of Early Care and Learning Child Care and Development Block Grant Total Child Care and Development Fund Cluster Total U.S. Department of Health and Human Services (Continued) N/A - Not available/applicable 12.unknown 93.575 Pass-Through Entity ID Number Total Expenditures S424A170011 N/A S196170011 V048A170010 $ 382,816 106,072 59,277 577,837 35,604,067 N/A 59,519 N/A 127,263 36,303,503 N/A 655,696 N/A 36,120 36,120 36,120 139 CLAYTON COUNTY BOARD OF EDUCATION SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 Federal Grantor/Pass-Through Grantor/Program Title U.S. DEPARTMENT OF TRANSPORTATION Passed through Georgia Governor's Office of Highway Safety Students Against Destructive Decisions Total Expenditures of Federal Awards Federal CFDA Number Pass-Through Entity ID Number Total Expenditures 20.601 2012-000-00422 19,877 $ 74,278,419 140 CLAYTON COUNTY BOARD OF EDUCATION NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 NOTE 1. NOTE 2. NOTE 3. BASIS OF PRESENTATION The Schedule of Expenditures of Federal Awards includes the federal grant activity of the Clayton County Board of Education (the "School System") and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in this schedule may differ from amounts presented in or used in the preparation of the financial statements. DE MINIMIS COST RATE The School System elected not to use the ten percent de minimis cost rate for the year ended June 30, 2018. SUBRECIPIENTS The School System did not pass through any grant funds to subrecipients for the year ended June 30, 2018. 141 CLAYTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 SECTION I SUMMARY OF AUDIT RESULTS Financial Statements Type of auditor's report issued Unmodified Internal control over financial reporting: Material weaknesses identified? Yes X No Significant deficiencies identified not considered to be material weaknesses? Yes X None Reported Noncompliance material to financial statements noted? Yes X No Federal Awards Internal Control over major programs: Material weaknesses identified? Yes X No Significant deficiencies identified not considered to be material weaknesses? Yes X None Reported Type of auditor's report issued on compliance for major programs Unmodified Any audit findings disclosed that are required to be reported in accordance with the Uniform Guidance Yes X No Identification of major program: CFDA Number Name of Federal Program or Cluster: U.S. Department of Education 84.010 Title I - Improving Academic Achievement 84.027 84.173 Title IV-B Special Education Cluster Flowthrough Preschool 142 CLAYTON COUNTY BOARD OF EDUCATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE FISCAL YEAR ENDED JUNE 30, 2018 SECTION I (CONTINUED) SUMMARY OF AUDIT RESULTS Dollar threshold used to distinguish between Type A and Type B programs: $2,228,353 Auditee qualified as low-risk auditee? Yes X No None reported. SECTION II FINANCIAL STATEMENT FINDINGS SECTION III FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS None reported. 143 CLAYTON COUNTY BOARD OF EDUCATION SCHEDULE OF PRIOR YEAR FINDINGS FOR THE YEAR ENDED JUNE 30, 2018 2017-001. Retainage Payable Criteria: Generally accepted accounting principles require reporting of all current liabilities whose liquidation is expected to require the use of current assets when the goods have been received or services have been performed. Condition: The School System did not properly address the above criteria as of June 30, 2017, as it relates to retainage payable in the Capital Projects Fund. Auditee response/status: Resolved 144 CLAYTON COUNTY BOARD OF EDUCATION THIS PAGE INTENTIONALLY LEFT BLANK