COMPREHENSIVE L NNUAL FINANCIAL REPORT :iscalYear Ended June 30,201 0 Atlanta Independent School SystemAtlanta, Georgia ATLANTA INDEPENDENT SCHOOL SYSTEM COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30,2010 Office of the Chief Financial Officer Charles A. Burbridge 130 Trinity Avenue, SW Atlanta, Georgia 30303 ATLANTA INDEPENDENT SCHOOL SYSTEM Comprehensive Annual Financial Report Table of Contents Fiscal Year ended June 30,20 10 INTRODUCTORY SECTION Letter of Transmittal GFOA Certificate of Achievement ASBO International Certificate of Excellence List of Principal Officials Appointed Officials Organization Chart FINANCIAL SECTION Report of Independent Certified Public Accountants Management's Discussion and Analysis Basic Financial Statements: Government-wide Financial Statements: Statement ofNet Assets Statement of Activities Fund Financial Statements: Balance Sheet - Governmental Funds Reconciliation of Governmental Funds Balance Sheet to the Government-wide Statement of Net Assets Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds Reconciliation of Governmel~talFunds Statement of Revenues, Expenditures and Changes in Fund Balances to the Government-wide Statement of Activities Statement of Net Assets - Proprietary Fund - Food Services Page 1 vii ... Vlll ix xiii xiv ATLANTA IN DEPENDENT SCHOOL SYSTElM Comprehensive Annual Financial Xeport Table of Contents Fiscal Year ended June 30,2010 Statement of Revenues, Expenses and Changes in Net Assets - Proprietary Fund - Food Services Statement of Cash Fiows - Proprietary Fund - Food Services Statement of Fiduciary Assets and Liabilities NOTES TO THE BASIC FINANCIAL STATEMEKTS REQUIRED SUPPLEmNTARY INFORMATION Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Title I Special Revenue Fund Schedule of Funding Progress OTHER SUPPLEI\/IENTARY INFORMATION Non-Major Governmental Funds: Combining and Individual Fund Statements and Schedules: Combining Balnnce Sheet - Won-major Governmental Funds Com'bining Statement of Revenues, Expenditures and Changes in Fund Balances - Non-major Governmental Funds Combining Schedule of lievenues, Expenditures and Changes in Fund Balance -Budget and Actual - All Special Revenue Funds Combined ScIle&uleof Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Title I1 Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Title VI - B Fund ATLANTA INDEPENDENT SCHOOL SYSTEM Co~nprehensiveAnnual Financial Report Table of Contents Fiscal Year ended Junz 30, 2010 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Lottery Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual -Other Federal Programs Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Other Special Pro-iects Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Capf tal Projects Fund Combining Statement of Changes jn lhssets and Liabilities Agency Fund Quality Basic Education Programs - Program Expenditures General Fund Quality Baslc Education Programs Schedule of Allotments and Expenditures by Program Schedule of Expenditc~resby Object - Lottery Programs Schedule of Approved Local Option Sales Tax Projects Schedule of State Revenue STATISTICAL SECTION (UNAUDITED) Net Assets by Component Changes in Net Assets Governmental Fund Balances Changes in Governmental Fund Balances General Fund Expendtures by Function ATLANTA INDEPENDENT SCHOOL SYSTEM Comprehensive Annual Financial Report Table of Contents Fiscal Year ended June 30,2010 General Fund Revenues by Source Assessed and Estimated Actual Value of Taxable Property Property Tax Rates - All Overlapping Governments Principal Property Taxpayers Property Tax Levies and CoIlections Coinparison of Property Tax Millage Rates Tax Millage Rates School Buildings, Acreage and Capacity Demographic Statistics Principal Employers Genera1 Fund per Pupil Cost School Breakfast Program School Lunch Program Number of Schools INTRODUCTORY SECTION Dear Citizens: January 27,20 11 Atlanta Public Schools (APS) continues its journey to excellence, which began in 1999 under the leadership of Superintendent Dr. Beverly L.Hall. Directed by the assumption that every child can learn and succeed academically if provided quality instruction in a safe and nurturing learning environment, Atlanta Public Schools began implementing research-based reform models on a district-wide basis. These reform models focus on increasing student academic achievement through a personalized educational experience. Snapshot of Atlanta Public Schools The APS story serves as a model far urban school districts nationwide, offering proof that a single goal - student academic success - can and does make a difference, regardless of gender or socio-economic background. Like many urban school systems, a majority of APS students come from challenging home environments. Three-fourths of APS students qualify for the federal fiee and reduced priced meals program, based on their family incomes that place them near the poverty line. Shldents also relocate frequently with nearly one-third of APS students moving during any single school year. A decade ago, APS struggled in many areas. Student perfonnance trailed the state by double digits, absenteeism was chronic; the graduation rate was below 40 percent; and the District had five superintendents at the helm in a 10-year period. Today, A P S is making national headlines with ten consistent years of progress, including steady improvements in student achievement, the ability to hire and retain quality teachers, increased employee morale, and refurbished and new faciIities. Highlights: APS fourth and eighth grade reading scores improved by fourteen points since 2002 on the National Assessment of Student Progress (NAEP) national, standardized test. Student perfonnance on these tests affirms the District's overall progress on state assessments. r The Dishiict's gradualion rate has increased dramatically, Erom 39 percent in 2002 to 69 percent in 2009. M S high school students fiom the class of 2010 eanied a record S129 million in academic and athletic scholarship offers. APS students also earned a record twenty- Atianta Public Schools I 1 3 0 Trinity Avenue. S.W. Atlanta, GA 30303 w atlantapublrcschools.us Ti1 -08-020 404-802-3500 nine 2010 Gates MiIIennium SchoIarships - more than any school District in the nation. APS Points of Pride 1 Seventy-nine percent of APS eighth-grade students met or exceeded standards on the 2010 Gecrgia Grade 8 Writing Assessment, improving their performance by 5 percentage points and closing the achievement gap with the state. 2. Bolstered by a $10 million grant frorn the Bill and Melinda Gates Foundation, APS has accelerated its efforts to recruit, prepare and support teachers through its Effective Teacher in Every Classroom Initiative. 'This initiative reflects research that indicates all shidents can achieve at high levels in the presence of a highly effective teacher. 3. International Baccalaureate (ID) instruction is available to students in kindergarten through high school, including students at the newly TB-certified Deerwood Academy in southwest Atlanta. To cornpete on a global playing field, APS offers courses in Mandarin Chinese, Spanish and French. Arabic and Latin are also available in several high schools. 4. To promote a smooth transition from elementary to middle school, APS created the Middle School Transformation Initiative. In addition to single-gender schools, APS middle school students will benefit from block scheduling that provides more individualized instruction. 5. From a $22.5 million math and science g a n t from the GE Foundation to the Early Lealning aucl Literacy Resource Center housed at Dunbar Elementary with support from the Annie E. Casey Foundation and other partners, a network of civic and Fortune 500 companies has invested in APS' student achievement. 6. All APS high schools have been transformed into smaller, more personalized learning environments that offer specialized fields of study. 7. The District's two single-gender middle schools opened their associated high schools this year with incoming fieshmen classes at B.E.S.T.Academy for boys and Coretta Scott King Young Women's Leadership Academy for girls. 8. Major renovations are undenvay at four APS schools, including North Atlanta, Benjamln E. Mays and D.M. Therrell high schools and Continental Colony Elementary School. These projects involve complete renovations and upgrades of existing buildings and campuses, costing more thml S 100 million. 9. Project GRAD, a signature reform initiative, helps students in 35 schools to envision a path that includes college and career. 10. As other districts reduce arts education programs, APS has maintained its commitments to quality instruction in this area. The Fine Arts Department has earned more than $1.2 million in professional development grants. Students also participate in programs with the Woodruff Arts Center, the High Museum of Art and the Julliard School, which offers a Summer Jazz Residency. Challenges Ahead The challenges that confront those of us spearheading advances in urban public education are many and varied. In the case of Atlanta Public Schools, these challenges include questions raised recently about the integrity of state standardized tests administered to APS students and about the very real gains experienced by our students over the past decade. These are serious questions that deserve serious responses. In response to concerns raised about excessive erasures on the 2009 Criterion-Reference Competency Test (CRCT), the Atlanta Board of Education called for an independent investigation that involved the creation of a Blue h b b o n Commission to oversee the probe that was conducted by two national testing and forensic accounting firms. The results of that initial five-month investigation are currently being reviewed and further investigated by the state and APS. The District has taken a number of proactive actions based on the preliminary results of the independent investigation, including bolstering testing policies and procedures and providing a tailored education program for those students who may have been impacted by testing irregularities. In response to questions that have been raised recently about the District's graduation and dropout rates, we are currently reviewing the data associated with these areas from over the past decade to ensure that they accurately reflect the progress that we have made in accelerating student achievement and providing graduating seniors with the knowledge they need to be successful in doing college and university level work. APS has successfully met the challenge of maintaining a high level of educational services for our students during this extended economic downturn that has resulted in a reduction of resources, including state and property tax revenues to support education. Despite these considerable challenges, A P S has maintained its commitment to continuing to provide visual and performing arts and nus sic progams for our students. These programs enhance student achievement in the core curriculum courses and help reduce the dropout rate by maintaining the interest of those students with interests in the arts. While all schools and departments have experienced budget cuts as a result of dwindling economic resources, the District's innovative urban school reform programs continue intact, along with the maintenance of academic coaches, counselors, school nurses and social workers - all of which are essential components of the educational services provided to our students. Local Economy The development of the fiscal year 2010 budget, which was approved on May 10,2010, was a planned, orderly process which evaIuated the prioritization of available funds for provision of Educational services for APS students. Both of our primary funding sources for the fiscal year 2010 budget have suffered, primarily because of the nationwide recession. Our major revenue stream for operations is property taxes, although we reported more in fiscal year 2009, this revenue stream was below the budget by $12.7 million. O w second major general fund revenue streain is state revenue through the "Quality Basic Education" Act finding. Because of the economy in Georgia, the Governor has made numerous austerity reductions in this revenue streain exceeding $22.3 million. The economic slowdown, additional state budget cuts, increased unfunded mandates and tax revenue challenges have put tremendous challenges to the School District. There will be continuing financial challenges for fiscal year 201 1 and beyond. Long-Term Financial Planning The School District plans capital improvements as future capital needs arise due to student population changes and facility repair and maintenance needs. Specific capital expenditure plans are formalized in conjunction with SPLOST receipts and anticipated annual receipts of capital outlay funds from the State of Georgia Department of Education. The School District regularly monitors anticipated capital outlay needs. Strategic Planning, Implementation and Measurement APS understands that a sound strategic plan is essential to the effective delivery of a world-class education. The District employs the Balanced Scorecard strategic management system to increase total customer value to students, parents, employees and community members. The strategic management system facilitates regular measurement of core district performance functions while balancing integrated, SMART (Specific, Measurable, Attainable, Relevant and Time-bound) objectives. In addition, the adopted system delivers a level of strategic clarity that ensures more accurate forecasting for future organizational needs. Financial Information Despite some of the challenges facing APS, we ended the fiscal year better than budgeted in the General Operating Fund. Using the full accrual basis of accounting, APS has total net assets of $1.3 billion, an increase of approximately $1 6.21 million from fiscal year 2009. There was also a decrease in unreserved fund balance. Further discussion is included in Management's Discussion and Analysis as presented on pages 3-14. Fund Accounting: The APS reports its financial activities through the use of h n d accounting. This is a system wherein transactions are reported in self -balancing sets of accounts to reflect the results of activities. (See Note t\ of the Notes to the Basic Financial Statements for a summary of significant accounting policies and a description of fund types). Internal Control Structure: The APS financial management officials are responsible for iinplementing and enforcing a system of internal controls to protect the assets of the APS from loss, theft, or misuse and to ensure that reliable accounting data are available for the timely preparation of financial statements in accordance with GAAP. The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that the cost of control should not exceed the benefits likely to be derived and that the evaluation of costs and benefits requires estimates and judgments by management. Awards The Government Finance Officers as so cia ti or^ of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to APS for its Comprehensive Annual Financial Report (CAFR) for the fiscal year ended June 30,2009. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized comprehensive ann-ualfinancial 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. The District also received the Association of School Business Officials (ASBO) International's Certificate of Excellence in Financial Reporting for the Comprehensive Annual Financial Report for the year ended June 30, 2009. This is the first year that the School District submitted the CAFR to ASBO. This award certifies that the report substantially confox~nsto the principles and standards of financial reporting as recommended and adopted by the Association of School Business Officials International. The award is granted only after an intensive review of financial reports by an expert panel of certified public accountants and practicing school business officials and is also valid for a period of one year. Acknowledgements This report could not have been prepared without the dedicated and effective help of the entire Finance Department staff. We wish to express our gratitude and appreciation to them for their contributions and professionalism. In Closing We are pleased to present to the community our Comprehensive Annual Financial Report (CAFR) for the fiscal year ended June 30: 20 10. Our community deserves the highest quality instruction. outstanding academic programs and comprehensive student development supports to prepare our city's youth for the challenges o f the world of tomorrow. Equally important. our community deserves relevant financial information and tight fiscal controls that will result in greater accountability to our taxpayers, legisiators and government entities that serve the needs of our students. We wiII continue to do our very best to meet both goals. Respectfully submitted, Charles A. Burbridge. Chief Financial Officer -, C.' Beverly L. Hall, Ed.D. Superintendent Certificate of Achievement for Excellence Reporting Presented to - Atlanta Public Schools Georgia For its Comprehensive Annual Financial Report for the Fiscal Year Ended June 30,2009 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. SCHOOL Bt.J$l&Ess INTERNATIONAL This Certificateof Excelle~cein Financial Reporting is presented to ATLANTA .mEPENDENTSCMOlOL SYSTEM For its Comprehensive Annual Financial Report (CAFR) For the Fiscal Year Ended June 30,2009 Upon recommendation of the Association's Panel of Review which has judged that the R.epnrt substantially conformsto principles and standards of ASBO's Certificateof Excellence Program President Executive Director ATLANTA INDEPENDENT SCHOOL SYSTEM List of Principal Officials June 30,2010 SCHOOL SYSTEM BOARD MEMBERS District 5: LaChandra D. Butler Burks, Chair Ms. Burks currently serves as Chair of the Atlanta Board of Education. Born and raised in Atlanta, Georgia, LaChandra Butler Burks' passion for children and commitment to education has been evident all of her Ilfe. As a product of Atlanta Public Schools, she considers it an honor to now serve as a member of the Atlanta Board of Education because it allows her to fight daily to have quality, public education for the children of a city she dearly loves. It is her strong belief that everyone must be involved in making sure that children are whole and well. On November 8, 2005, the residents of Atlanta elected LaChandra Butler Burks out of six candidates with 58% of the votes as the Atlanta Board of Education District 5 Representative. A graduate of L.P. Miles Elementary School and C.L. Harper High School with a Bachelors Degree from State University of West Georgia, (formerly West Georgia College) and a Masters of Business Administratiofi from Keller Graduate School of Management. LaChandra Butler Burks received most of her political experience fi-om having worked under the leadership of three Atlanta mayors for 13 years. District 3: Cecily Harsch-Kinnane, Vice Chair Ms. Harsch-Kinnane currently serves as Vice Chair of the Atlanta Board of Education. She has been involved in Atlanta Public Schools for nine years. She and her husband, Paul, have t h e e chldren in APS and she has served as PTA president at Morningside E.S., on the PTA boards at Inman M.S. and Grady H.S., as co-president of the Council of Intown Neighborhoods and Schools and on the principal selection committee at several schools. She has been involved with Habitat for Humanity, served on the City of Atlanta Elected Officials Compensation Commission and on the board of the Atlanta Youth Soccer Association. Ms. Harsch-Kinnane is a fonner middle and high school math teacher and has recently been the coordinator of an after school-mentoring program. She is a native of Atlanta, received a BA in Mathematics from Brown University, and has done graduate work in Math Education and Educational Psychology at Georgia State University. District 1: Brenda J. Muhammad Brenda Muhammad is the executive director of the Atlanta Victim Assistance, Lnc. (AVA), an organization that advocates for the fundamental rights of victims and witnesses of crime with compassion, dignity and respect. AVA provides comprehensive services, which remove barriers, strengthen victims and their farnilies and foster a healthy transition from victim to survivor. Passionate about children and their educational needs, particularly those who are underserved, Brenda currently serves as the School Board Representative for District 1. She has also served the Atlanta School Board in -times:past as Chair and Vice Chair. District 2: Khaatim Sherrer El In November 2003, voters in District 2 elected Khaatim S. El to the Board of Education as the youngest board member in the history of the Atlanta Public Schools. He has served as Chair of the Board Development/Workshops Committee. He is a Board Representative on the Project Grad Committee and on the Fulton County Department of Health and 'We1lness Board. During his high school years, Khaatirn served on the Board of Education in Newark, New Jersey as the student representative, beginning his work and interest in youth advocacy and ljl~bliceducation. Khaatim is a proud graduate of Morehouse College where he earned a degree in Urban Studies and Public Policy. District 4: Kathleen Barksdale Pattillo Kathleen (Katy) Pattillo served as chair of the Atlanta Board of Ecluceltion (2006-2005). Prior to her board work, she served as copresident afthe PTA at Sarah Smith Elementary School and as the chair of the Boys & Girls Club of Metro Atlanta. She previously practiced law, has worked at CNN, the Southern Company and in the press offices of the U.S. Senate Majonty Leader Howard Baker and Sen, Herman E. Talinadge. Ms. Pattillo received her J.D. degree from Emory University School of Law and her B.A. in political science from the University of Georgia after attending HoIlins College. She serves as a trustee of the Boys & Glrls Club of Nletro Atlanta. District 6 : Yolanda Johnson C Yolanda Johnson is a proud resident of the Adains Park Community of Southwest Atlanta. She is a product of public schools and a practicing attorney who has been actively engaged in the community since she made Atlanta her home more than a decade ago. She began volunteering with the Atlanta Public Schools (APS) when she agreed to serve on a coinmittee redeveloping the curriculum for the Law and Government Magnet at Therrell High School. This experience gave her unique system insight and firsthand knowledge of how even a small group of dedicated people can make differences in the lives of our children: our hture. Seat 7: Eric W. Wilson Eric W. Wilson was elected to the Atlanta Board of Education, District 7 At-Large in November 2001. In 2003 through 2005, he served the Board as Vice Chair additionally; he has chaired the Facilities Commission and has served as an active member of numerous other board committees. Eric W. Wilson holds a Master of City Planning degree from the Georgia Institute of Technology, a Bachelor of Science in PubIic and Environmental Affairs from Indiana University and received his Military Officer Commission from the Indiana Military Academy. Seat 8: Mark Riley "Revitalizing Atlanta's inner city has been a focus of my professional life, and I have always firmly believed that revitalization of the city must be paralleled by the development of a system of high performing schools. Without such schools, Atlanta will not fbllfill its potential to prepare its residents to contribute to a high quality of Iife not only for themselves, but for all of us." Mr. Riley is Managing Partner of Urban Realty Partners, an in-itown real estate deveIopment fi-rn. He is also Director of the Sartain Lanier Family Foundation (focused on improving education options in the metro Atlanta area) and serves on several civic boards. He holds J.D. and B.A. degrees from Vanderbilt University a,nd is active in alumni affairs Seat 9: Emmett D.Johnson Mr. Emmett Joh~sorhi as proven that he is a person dedicated to making a positive difference. He is committed to serving the needs of our youth. He is knowledgeable about educational issues. As a member of the Atlanta Board of Education, Mr. Johnson: Mr. Johnson served as Vice-Chair of the Board (2006-2008); has been appointed by Governor Sonny Perdue to the Master Teacher & Academic Coach Implementation Committee (July 2005); served as Chair of the Atlanta Board of Education (2003); chaired the Community Support for School Reform and Innovations Ad Hoc Committee (2000); chaired the Board Development/Board Retreat Task Force (2002); serves on the Facilities Master Plan Oversight Cornmission and the Parent and Family .Involvement Task Force; was a member of the 2001 Georgia School Boards Association Governnlental Operations Committee; Is a member of the Georgia School Boards Association Nominating Committee for the selection of the Association's, President; President Elect, and Treasurer (2000 - 2001); served as delegate to the Georgia School Boards Association (2001) and served as a representative to Metro RESA (2001). Atlanta Board of Education Goals and Objectives Each year, the Board of Education adopts goals as a means to improve its educational programs. The human and financial resources are allocated in the budget in order to achieve the adopted goals of the District. The objectives of the Atlanta Board of Education are: 9 To provide and maintain a quality, comprehensive, high-level curriculum to be followed by all schools in the District; 9 To enhance the use of technology by students, teachers and staff in the instructional process; 9 To enhance political relationships with various entities in the District; P To increase public awareness and participation in School District affairs; and 9 To exercise fiscal discipline. ATLANTA INDEPENDENT SCHOOL SYSTEM APPOINTED OFFICIALS JUNE 30,2010 SUPERINTENDENT Beverly L. Hall, Ed.D. SENIOR CABINET Charles A. Burbridge. ..................................................Chief Financial Officer Veleter Mazyck..................................................................General Counsel Kathy Augustine.. ......................................Deputy Superintendent for Instruction Millicent Few...................................................Chief Human Resources Officer Larry Hoskins. ...................................... ..Deputy Superintendent for Operations Suzanne Yeager.. ............................................ ..Chief Communications Officer Joyce McCloud. ............................................Special Assistant to the Superintendent . Alexis Kirijan...............................,.,, ,,Chief Strategy and Development Officer David Williamson.. ...............................................C. hief Information Officer Sharron Pitts.....................................................................C..h.ief of Staff Organizational Chart xiv Financial Section Russell W. Hinton STATE AUDITOR (4W)6.56-2174 DEPARTMENOTF AUDITSAND ACCOUNTS 270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 April :14, 2 0 1 1 Honorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Atlanta lndependent School System INDEPENDENTAUDITOR'S REPORT ON BASIC FINANCIAL STATEMENTS Ladies and gentlem men: 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 Atlanta lndependent School System (School System), as of and for the year ended June 30, 2010, which collectively comprise the School System's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the Atlanta lndependent School System's management. Our responsib~lityis 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. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial sta,ter~entsa, ssessing .the accounting principles used and the significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. In our opinion, the financial slatements referred to previously present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the agregate remaining fund information of the Atlanta lndependent School System, as of June 30, 2010, and the respective changes in financial position and cash flows thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. As described in Note R to the financial statements, the School System removed financial activity for previously reported blended and discretely presented component units. Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis on pages 3 through 1 4 and the required supplementary information on pages 5 1 through 5 3 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures, to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during the 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. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Atlanta Independent School System's financial statements as a whole. The lntroductory Section, the Supplementary lnformation and the Statistical Section are presented for purposes of additional analysis and are not a required part of the financial statements. Such information is the responsibility of management and was derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. The Supplementary Information on pages 54 through 68 has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconc~lingsuch information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the financial statements as a whole. The lntroductory Section on pages I through xiv and the Statistical Section on pages 69 through 89 have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion on them. A copy of this report has been filed as a permanent record in the office of the State Auditor and made available to the press of the State, as provided for by Official Code of Georgia Annotated section 50-6-24. Respectfully submitted, m Russell W. Hinton, CPA, CGFM State Auditor MANAGEMENT'S DISCUSSION AND ANALYSIS ATLANTA INDEPENDENT SCHOOL SYSTEM Management's IDiscussion and Analysis For the Year Ended June 30,2010 The discussion and analysis of the Atlanta Independent School System's financial performance provides an overview of the fiscal year ended June 30, 2010. The intent of this discussion and analysis is to examine the School System's financisl perfommice as a wholz, identify changes in financial position as well as to provide basic financial statements. The basic financial statements and notes to the basic financial statements should be reviewed by the readers to enhance their mderstmding of the School Systeri-4's financial perfornance as a whole or as an enlire operating entity. The basic financial statements contain the foliowing components: 1) Government-wide financial statements including the Statement of Net Assets and the Statement of Activities, which provide a broad, long-term overview of the School System's finances. 2) Fund-level financial statements provide a greater level of detail about the School System's major funds and focus on how well the School System has performed in the short-term in the most significant filr~ds. 3) Notes to the Basic Financial Statements. This report also presents the highlights for the year ended June 30, 2010 and contains other supplementary information. FINANCIAL CTJGHLJCHTS Overall, net assets in fiscal year 2010 increased by 1.3% over fiscal year 2009. This is evidence of management's ability to maintain a balanced budget and control expenses, despite austerity reductions due to economic downturns affecting the Districts revenues. The key financial highlights for fiscal year 20 10 as represented are: Government-wide Financial Statements: 3 Total net assets for the SchooI System increased fiom $1,282.71 million in fiscal year 2009 to $1,298.92 million in fiscal year 2010, an increase of approximately S16.21 million or 1.3% due to revenues exceeded expenses by approximately S 16 million as a result of major budget cuts during the year. Net assets increased by $16.15 million for Governmental Activities and increased by roughly $66,000 for Business-type Activities. > Total revenues decreased from $845.46 million in fiscal year 2009 to S805.55 million in fiscal year 2010, a decrease of approxirnatcly $-39.91 million or -4.7%. Revenue for Governmental Activities decreased $39.95 million whlle revenue for Business-type activities increased by $0.05 million. 3 Total expenses increased $3.28 million or 0.4% from $786.06 million in fiscal year 2009 to $789.34 million in fiscal year 2010. Expenses increased in Governmental Activities by $1.81 million and increased by $1.47 million in Business-type Activities. Fund Financial Statements: The School System has prepared its annuaI financial reports corresponding to the Governmental Accounting Standards .Board No. 34 financial reporting model. The following graphic is provided to give the reader an overview of this reporting model. OVERVEW OF FINANCIAL STATEMENTS Government-wideFinancial Statements The Government-wide financial statements are designed to provide the reader with a broad overview of the School System's finances in a manner similar to those used by private-sector businesses. The Statement of Net Assets and the Statement of Activities provide information &out the activities of the whole School System, presenting an aggregate and long-term perspective of the finances. These statements include all assets and liabilities using the accrual basis of accounting. This basis of accounting includes all of the current year's revenues and expenses regardless of when cash is received or paid. o The Statement of Net Assets presents information on all of the Schools System's assets and liabilities, with the difference between the two reported as net assets. Increases or decreases in net assets may serve as a useful indicator of whether the financial position is improving or deteriorating. o The Statement of Activities presents information showing how net assets changed during the fiscal year. AII changes in the net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of !he timing ofthe related cashjlows. Thus, revenues and expenses are reported in the statement for some items that will result in cash flows in future fiscal periods (for example, uncollected taxes and earned but unused vacation leave). Included in the Statement of Net Assets and Statement of Activities for the School System are two distinct kinds of activities: 9 Governmental Activities - Most of the School System's programs and services are reported here including instruction, pupil services, improvement of instruction, educational media, general administrative, school administrative, business administration, maintenance and operation of facilities, student transportation and central support. 9 Business-type Activities - This service is provided on a charge for goods or services basis to recover all of the expenses of the goods or services provided. The Food Services proprietary fund is reported as a business-type activity. 'Table 1 - Condensed Staterncnt of Net Assets (in miilions of dollars) Current and other assets Net capital assets Total assets Long-term debt outstanding Other litlb~llttes Total liabilities Ne: assets Invested in capltal assets, net of related debt Restricted for debt serviccs Restrlcled f o ~capital projects Unrestricted Total net assels Governmental Act~vtttes Restated 2010 m Busmess-type Activit~es 2010 2009 Total School System Restated percentage 2010 2009 chanRe .Ox. P Total assets increased by $14.61 million or 1 9 Current and other assets decreased by $-76.76 million or -16.85%. 9 Capital assets, net of accumulated depreciation for all activities increased by $91.37 million or 9.07%. For governmental activities, the increase primarily represents additions to buildings and building improvements. 9 Long-term debt outstanding b a e d by $21.72 million or 32.4%. Table 2 - Condensed Changes in Net Assets (in millions of dollars) Revenues Program revenues Charges for servrces Operating gTants and contrrbut~ons General revenues Property taxcs, levied for general purposes Specral Purpose Local Oprron Sales Tax Investment eamlngs Grants and Contributions not restricted to specific programs Property taxcs levied for debt service Other Gain on Sale of Assets Total Revenues Expenses: instruction Support Servrces: Pupil servlces lrnprovemenr of rnstructional services Educational media General administration School adm~nistrat~on Busmess adminish-ation Maintenance and operation of facilities Srudent transportation Central support Food servrces Other support services Interest expense Total Expenses Change in Net A.sets Beginning Net Assers, as restared (Xote R) Ending Net Assets Goverrimental Activities 20 10 Restated 2009 Business-type Activ~ties 2010 2009 Total School System Restated Percentage 2010 2009 Chanse Primary Government Sources ~JRevenues Total revenues, overall, decreased $39.91 million or -4.7%, from fiscal year 2009 to fiscal year 2010, wi,th an decrease in program revenues of$-0.13 million. Program revenues are primarily grmt related and account for 28.4% or $223.90 milllon, of total revenues received due to State QBE revenue decrease. General revenues represent the major revenue stream for the School System. They nccount hr.71.6% or S576.66 million, of total revenues received in FY 201 0 . B e t w ~ e nfiscal years 2009 and 2010, an increase of S IS).? million in propel-ry tax r.c\renue occun.c.d and a decrease in SPLOST sales tax revenues of $-45.52 milliori. Primary Government Expenses Total expenses increased from 2009 to 2010 by 0.4% or $3.28 million. Management continues to accurately forecast spending levels and manage spending throughout the year. Goverrmental activities account for 97.1%, or $766.12 million of total Bistrict spending. Four goups of activities account for 86.'7%, or $664.20 million of governmental spending: instruction ($438.04 million or 57.2%); pupil and improvement of insti-uctional services ($77.73 million or 10.1%); administration and business services ($57.68 million or 7.5%); and maintenance and operations ($90.75million or 1 1.8%). Business-activities revenues and expenses increased from 2009 to 2010, with revenue increasing by approximately $47,000 or 0.2% and expenses increasing by $1.47 million or 6.8%. Revenues increased due to an increase In pupil sales. Expenses increased as a result of unanticipated increase in costs. Table 3 - Net Cost of Governmental Activities (in millions of dollars) Instruction Support Services : Pupil services [rnproverneo~o f instructional servlces Educational media General adrninistt-ation School adm~nistration Business administration Maintenance and operation of facilities Student transportation Central support Community services Other support services Enterprise operations Interest expense Total Expenses Total Cost of Services Restated Percentage 2010 2009 Change S 438.04 $ 427.13 2.6% $ Net Cost of Services 2010 Restated 2009 Percentage Change -327.07 S -318.66 2.6% The net cost of governmental activities represents the cost of operating the School System to be covered by general revenues, including property taxes. The net cost of services increase is attributable to reduction in program revenues, primarily Quality Basic Education funds received from the State Department of'Education. Table 4 - Capital Assets (net of accumulated depreciation, in millions of dollars) Land Construction in Progress Buildings Building improvements Land Improvements Furniture and Fixtures Equipment Vehiclcs Total Governmental Activities Restated Percentage 2010 2009 chanjie Construction in Progress and Boildings SPLOST I1 construction programs to renovate academic facilities are near completion. For more detailed information on the School System's capital assets, see Note G in the notes to the basic financial statements. Table 5 - Outstanding Lsng-Term Debt finmflltonsof ddlars) Capital leases $ Intergovernmental apreement- City of Atlanta Education Reform Success Compensated absences Contingent Liabilities - Legal Contingent Liabilities - Sales 'Tax Refund Contingent Liabilities - SPLOST Refund Workers' compensation Total School System Restated percentage 20 10 2009 change 14.00 $ 18.16 -22.9% 5.80 5.3 1 2.59 5.75 2.53 0.00 29.06 0.00 6.38 7.83 9.2% -55.0% 100.0% 100.0% -1 8.5% Outstanding long-term debt increased, in the current fiscal year; mostly due to a $2.53 million and $29.06 million increase in Sales Tax Refund and SPLOST Refimd, respectively. In addition, outstanding long-term debt decreased due to a $4.1 million and $3.2 million decrease in capital leases and contingent liabilities, respectively (see Note R). For more detailed information on the School System's long-term debt, see Note H in the notes to the basic financial statements. Fund Financial Statements Fund financial statements provide detailed infoilnation regarding the resources segregated for specific activities or objectives, not Government-wide. Funds are used to track specific sources of revenue and expenditures for particular programs. The School System has three kinds offunds: Governmental funds include most of the School System's basic services and focus on providing cash flow available for spending. These funds include the General Fund, Title I - Special Revenue Fund, Capital Projects Fund and other governmental h n d s of lesser magnitude. Fund accounting statements use the rnodified accrual method of accounting, which measures cash and other financial assets that can be readily converted to cash. These statements present a short-term view of the School System's operations and services and do not include the long-term focus presented in the Government-wide financial statements. For an explanation of the differences, see the reconciliations included with the Governmental Fund Statements. Proprietary fund consist of services provided by the School System for a fee and employ the f i l l accrual method of accounting in the same manner as the Government-wide statements. The School System has one proprietary h n d , Food Services. This fund provides student meals at a cost based on the student's ability to pay, subsidized by federal funds and the School System. Fi'duciary&~rdrPaccount for assets not owned by the School System but for which the School System is responsible for ensuring that the assets in the funds are used for their designated purposes. These funds are not included in the Government-wide financial statement because they cannot be used to finance the School System operations. The School System has one fiduciary h n d - Agency Funds (Local School, Club and Class Funds). The following presents a summary of the General Fund, Title I - Special Revenue Fund, Capital Projects Fund and other governmental h n d s by type of revenue for the fiscal year ended June 30, 2010 as compared to June 30, 2009. Table 6 - Revenues (in millions oCdollars) Local taxes Sales taxes income State revenues Federal revenues Investment income F a c ~ l i t yrental fees T u i t ~ o ncharges Charges for services Other Proceeds fi-oni sale of c a p ~ t a lassets Total Revenues Governmental Funds ~ e s t a t e d Increase 2010 2009 (Decrease) Percentage Change The following tsble presents a summary of the General F ~ i i d ,Title I - Special Revenue Fund, Capital Projects Fund and other governmental h n d s by type of expenditures for the fiscal year ended June 30,2010 as compared to June 30,2009. Table 7 - Expenditures (in millions of dollars) L~struction Support services Pupil services Improvement of instructional services Educational media General administration School administration Business admi~istration Maintenance and operation of facilities Student transportaiion Central support Other support services and nutrition Capital outlays Debt service Total Expenditures Excess (deficiency)of revenues over (under) expendihires - See Table 6 Transfers in Transfers out Governmental Funds Restated Increase Percentage - 2010 2009 (Decrease) Change Fund Balances, Beginning of Year as restated 319.84 355.60 (35.76) FUND BALANCES, End of Year Decreases in student transportation and capital outlay due to budget cuts during the current fiscal year. Analysis of Major Funds The School System has three major funds: the General Fund, Capital Projects Fund and the Title I Special Revenue Fund. The General Fund is the general operating fund of the School System and is used to account for all financia1 resources except those funds accounted for In another fund. The Capital Projects Fund is used for the acquisition or construction of major capita1 facilities and to account for the bond proceeds restricted to renovation and school construction. The Title I - Special Revenue Fund is a federal grant used to supplement the general operating find by ensuring students gain knowledge and slulls, as we11 as upgrade the entire educational program for systematic reform. General Fund As of June 30, 2010, total h n d balance in the General Fund was 5109.73 million, reserved $33.80 million, and $75.93 million in unreserved undesignated. As a result of operations in fiscal year 2010, the fund balance decreased by $48.17 million. For Budget to Actual comparison purposes, the General Fund reported excess expenditures over final budget for the following functions: GENERAL FUND Instruction Salaiy Pupil Services Non-Salnry Improvement of Instruction Non-Salaiy Maintenance and Operations Salury Non-Salary Student Transportation Salary Debt Service Principle lnleresl Capital Proiects Fund As of June 30, 2010, total .Fund balance in the Capital Projects Fund was $136.89 million. This balance included reserves of $136.89 million for Special Purpose Local Option Sales Tax (SPLOST). The fund balance decreased by $-12.90 million due primarily to an increase in SPLOST capital expenditures and a decrease in SPLOST revenues. Title I - Special Revenue Fund As of'June 30,2010, the Title I - Special Revenue Fund has a zero fund balance. Revenues equaled expenditures. This fund is a reimbursable grant. Other Governmental Funds As of June 30, 2010, total fund balance in Other Governmental Funds was 31 1.83 million. This balance included. unreservedldesignated h n d balance of $11.77 million for special revenue find. Current Issues Currently known facts: decisions or conditions that are expected to have a significant effect on tbe financial position or resuIts of operations are as follows: Atlanta Independent School System received Federal American Recovery Reinvestment Act (AR3.A) funds which helped to offset reductions in State QBE funding. The continued support of our schools by the public and by local community organizations and businesses is also an integral part of our ability to educate our students. Continuing revenue from the Special Purpose Local Option Sales Tax should facilitate our ability to replace and improve existing schools and add additional classrooms. Our operating budget will continue to be tight, as we expect decreased funding from the State of Georgia due to current financial conditions. Despite these challenges, we remain committed to using our financial resources efficiently to provide an exceptional educational experience for our students. In February 2008, the Supreme Court of Georgia issued a decision holding that educational ad valorem taxes can only be used for educational purposes. In response, the General Assembly passed Senate Resolution 996, a proposed amendment to the Georgia Constitution permitting Boards of Education to agree to pledge educational ad valorem taxes for redevelopment projects and purposes, and the voters ratified the constitutional amendment by referendum in November 2008. As a result of Senate Resolution 996 and the referendum, House Bill 63 was passed by the General Assembly and became effective April 22, 2010, reenacting the Redevelopment Powers Act. However, in December 2008, a challenge to the use of retroactive educational ad valorem taxes was filed by a taxpayer. In August of this year, the Superior Court issued an order expressly authorizing the City and Atlanta Development Authority (ADA) to transfer to APS for its general purposes all of the Perry Bolton and BeltLine ad valorem tax increment that they had received for tax years up to and including 2009. Pursuant to this order, the City and ADA actually made a transfer of funds to MS. The Plaintiffs in the Clark case have initiated two appeals of orders related to the August transfer of funds. Briefing on those appeals is currently under way. APS filed motions to dismiss both appeals on behalf of all defendants other than the Tax Commissioner and will file responsive briefs in December 2010. The City of Atlanta will file briefs on behalf of the District in support of the District's cross appeals. General Fund Budgetary Highlights The School System's budget is prepared by the Finance Division and is a collaborative effort between the School System and the Atlanta community. The basis for preparation utilizes a zerobased approach because it has systematically provided a more accurate account of anticipated spending levels for the year. Details of the General Fund original budget and the amended budget are presented on page 51 in the Financial Section of tliis report. Requests for Information This financial report is designed to provide a general ovesview of the School System's finances for all those with an interest in the School System's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the School System's Chief Financial Officer, 130 Trinity Street SW, Atlanta Georgia 30303. Basic Financial Statements Atlanta Lndependent School System Statement of Net Assets Junc 30,20 10 ASSETS Current Assets: Cash and cash equ~valents Restricted cash Investments Taxes rece~vablen, et Due from other governments Other receivables lnternal balances Prepaid expenses and other assets Total current assets Noncurrent assets: Net pension asset Non-deprec~ablecapital assets Depreciable capltal assets Less: Accumulated depreciation Total noncurrent assets TOT4L ASSETS LIABILITIES Current liabilit~es: Accounts payable and other current liabilittes Due to other governments Unearned revenues Current portion of long-term obligations Total current liabilities Noncurrent Ilabll~t~es: Noncurrent portion of long-term obligations TOTAL LWBlLITlES NET ASSETS Invested in capital assets, net of related debt Restricted for: Debt service Cap~talprojects Unrestricted TOTAL NET ASSETS Governmental Activit~es Business-type Activities Total The accompanying notes are an integral part of the basic financial statements Arlsnm IndependentS~hooSl ystcm Statamemof Aclrvllllr Fo: thc Year Endcd Junc 30.201 0 FuntrionslYrogrrms P r i m l y Covcrnmcnt Covernmrnlrl rrlivilh: Iwmrllon Suppon Scrvew Pupd remccs Improvemen: of bnstructtonal services Educalionnl medm Ccnenl ndm~nistratian Schml sdmmniralinn Busnncra ~ d l n l m s t r a l i o n Malnltnanre and opcralion of facllirics Studca mansponnlion Ccn1r;tl suppo" Comn:unl!y scrvica Othcr supporl scrviccs Entcrpr~soopenllons Total B u s h e r r - ~ acclhiticr Total School Sysrcm Erllcnses Charge for Scwiees Operating Grants and Conn~bulwnr Govanmental Aenlx~e~ Busims-rnr Acml:!cs TOTALS T.lxes. Propcrry Taxer levied Tor g ~ n e ~paurlposcs Propcriy Taxes. Levled lordcbl servicc Spccial Local Opt~onSales Tar S: Othcr Taxrr Grnnts and Conmbut>onsnot rertrictcd io specific progrnrns lnvestnicnt camings Other Gain on sale o f capital assets Tolal Gcncnl rcvenua 448.92 1.379 1,271,739 63,438,076 1.306.947 230.484 10.583.834 897.453 576.619.012 S.202 8,202 498.921.379 1.271.739 63.438.076 1.106.947 23%,686 lO,L83.R1~ S97.453 576.658.1 Id Ncl arch .cnd o f year The acconlpanying no:es itl.~. on ~nlcgrapl all of l l ~ chasc fmahcial statcrncnu ASSETS Cash and cash tquivalc~ils Restricted cash Inves~rnenrs Taxes Rece~vables.net Due from olhcr govcmmcnts Other rccdvables Duc from othcr funds Inlemt receivable Prcpaid ilerns TOTAL ASSETS LIABILITIES AND FUND UALANCES L~ab~lilies Accounts payable and accrued liahililics Reramage payablcs Contracts paysblc Due to other funds Due lo othcr govemn>snls Dcferred tevenuc To~alLiabil~l~es Fund Balalices: Rescrvcd for. Federal programs Debt service Board action Itcms Rescwed fbr capltill projecls Unreserved/deslgnaled for Local programs-Special revcnuc h n d IJnrcserved. undesrpa~ed.rcporled In: Gcncral fund Towl Fund Balanccs TOTAL LWBlLlTIES AND FUND BALANCES Allanla Independent School Sysvm Balance Sheel Govemmcl:tal Funds Julre 30. 2010 General Fund Capr~aPl rojccls Fund Title 1 Fund Nonmajor Covemmenwl Funds Total Co\,crnmen~al Funds The accompanyrng notes are an integral pan of the basic financial ststemenls ATLANTA INDEPENDENT SCHOOL SYSTEM Reconciliation of Governmentat Fund Balance Sheet to the Government-wide Statement of Net Assels June 30,201 0 Total Fund balances - rota1 governmental funds Amounts reponed for governmental aclivites in the Statemen! of Net Assets are different because: Capital assets used in governmental activities are not financial resources and, therefore are not reporied in the above funds. Cost of capital assets Less: Accumulated depreciation Property taxes and sales taxes used in povernmenral activities represents amounts the1 are not iinancial resources and not reported in the above funds. Sales tax Property Taxes receivable Allowance for uncollectible receivables Accumulated pension contributions in excess of annual required contriburions are reponed as assets for governmental activities. Long-term liabilities, including capital leases, are not due and payable in [he currc-n~period and therefore are not reported in the above Cunds. Capiral leases City of Atlanta -Intergovernmental Agreement Education Reform Success Compensated absences Workers compensation Contingent Liabilites - sales tax refund Contingent Liabilites - SPLOST reiund Contingent legal liabilities NET ASSETS OF GOVERNMENTAL ACTTVITIES The accompanying notes are an integral part of the basic financial statements. Allanla Indepcndcnt School System Slalcmer~ol f Revenuer,Crpendlturcs and Changes m Fund Balancer Covann~cnlrtFl unds For Tlrc Year Endcd June 30. 2010 REVENUES h n llsxs Sskr tarcr incornc Slslc revenues redenl rcvcnucs l n v ~ ~ l n l clnclrlrnc Fxc~l~re).ntal Xer Tutrton charges Charges for rcwi~cr Othcr Total revenues EXPENDITURES Culrcnl. Ir,slfuclion supporl SCYI~CC:I I'uptl xrviccs lmprovcmcnl o f insrmclronul srwices ECucbllonn! lmcdiil Gencr~al dtl!inirl:alion School administration Rustness ndrni~lratrution Mamunonce and aprr~tionof fic>lil>ci S:udcnl lrunsponalion Ce,,aal suppofl 0u;rr sctppon scruiccs Capilal Oullay Dcbc Sc~vicc. Principal Inlcr~,I Gcncral Fund I'apllal Projecls Fund T11lc I Fund Excess(deficiency) ol'revenuer over/(uodcr) expendi~ms OTHER FMANCMO SOIJ!KES(USES) Piocecdr from ralc ofcap!laI a w l s Transfer, in Tramfcn oul Tatml01hr.r Psnawtng SourcedUxs) Ner change In (und brlanccs Fund Bnlanccr, Beginntng0rYc.x as a$lalcd FUND RALANCCS. End ofyear The a c c o n p n y n g notcr arc an integral pan i l f l h c bas:c tinsncral slalcnicnla Noomqor Go\rmmcnal Funds To131Gorernmennl funds ATLANTA FVDEPENDENT SCHOOL SYSTEM Reconciliation of Governmental Funds Statement oCRevenues, Expenditures and Changes iil Fund Balances To the Government-wide Statement of Activities For the Year Ended June 30.201 0 Total Net Change in Fund Balances - Governmental Funds Amounts reported for Governmental Activities are different because: Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated usehl lives and reported as depreciation expense. This is the amount by which capital outlays of exceed depreciation of in the current period. Capital outlays Depreciation expense The net effect of various miscellaneous transactions involving disposal of capital assets which decreased net assets. Revenues reported in the statement of activities that do not provide current financial resources and, therefore, are not reported as revenues in governmental funds. This represents the excess for the fiscal year. Pension contributions in excess of Annual Required Contributions are reported as assets for Governmental Activities. (326,925) 3,426,375 1,939,900 Some expenses reported i i ~the statement of activities do not require the use of current financial resources and , therefore, are not reported as expenditures in govemmental funds. The issuance of long-term debt (e.g., leases, notes) provides current financial resources. Capital leases Tntergovemmental agreement - bonds payable Compensated absences Education Reform Success - certificates of participation Contingent Lcgal Liabilitites Contingent Liabilitites - SPLOST refund Workers' compensation 4,158,63 1 1,026,875 (495,101) 570,000 3,161,500 (29,064,20 1) 1,444,5 17 (19,197,779) CHANGE IN hET ASSETS OF GOVERNMENTAL ACTIVITIES Tl~eaccompanying notes are an integral part of the basic financial statements $ 16,147,128 Atlanta Independent School System Statement of Net Assets Proprietary Fund - Food Services June 30,2010 ASSETS Current assets: Cash and cash equivalents Due from other governments Other receivables Inventories Total Assets LIABILITIES Liabilities: Current Liabilities: Accounts payable and accrued liabilities Due to other funds Unearned revenue Total Liabilities NET ASSETS Unrestricted Total net assets TOTAL LIABILITIES AND NET ASSETS The accompanying notes are an integral part of the basic financial statements. Atlanta Independent School System Statement of Revenues, Expenses and Changes in Net Assets Proprietary Fund - Food Services For the Year Ended, June 30,20 10 Operating revenue: Charges for services Operating expenses: Personnel costs Professional and contract services Supplies and materials Other operating costs Total Operating Expenses Operating Loss: Nonoperating revenues: Grants - Child Nutrition Program Investment Income Total Nonoperating revenues: Changes in net assets Net Assets Beginning of Year NET ASSETS, END OF YEAR 23,222,029 (21,385,117) 65,688 1,972,799 $ 2,038,487 The accompanying notes are an integral part of the basic financ~asltatements Atlanta Independent School System Statement of Cash Flows Proprietary Fund - Food Services For the Year Ended June 30, 20 10 Cash Flow From Operating Activities Cash received from user charges Cash payments to employees for services Cash payments to suppliers for goods and services Net cash used for operating activities Cash Flows From Non-capital Financing Activities Non-operating grants received Net cash provided from for non-capital financing activities Cash Flows From Investing Activities Interest on bank accounts Net cash provided by investing activities Net change in cash and cash equivalents Cash and cash equivalents, beginning of year Cash and cash equivalents, end of year (24,972,569) 20,165,225 8,202 (4,799,142) Reconciliation of operating (loss) to net cash provided (used) by operating activities: Operating (loss) Adjustments to reconcile operating loss to net cash provided (used) by operating activities: Cornmmodities used Changes in Assets ancl Liabilities Increase in Accounts Receivables Decrease in liabilities Net cash used for operating activities Noncash Non-Capital Financing Activities USDA donated food comn~odity S (24,972,569) The accompanyng notes are an integral part of the basic financial statements. Atlanta Independent School System Statement of Fiduciary Assets and Liabilities June 30,20 10 Assets: Cash and cash equivalents Agency Fund Local School, Club and Class Funds Liabilities: Due to local schools and student groups $ 901,214 The accompanying notes are an integral part of the basic financial statements. NOTES TO THE BASIC FINANCIAL STATEMENTS Atlanta Independent School System Notes to the Basic Financial Statements June 30,2010 A. Summary o-ISignificant Accounting Policies The financial statements of the School System have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) as applicable to government units. The more significant of the School System's accounting policies are summarized below. 1. Reporting Entity The Atlanta Independent School System (School System) was established by the Georgia State Legislature and is cornposed of nine publicly elected members serving four-year terms. The School System has the authority to approve its own budget and to provide for the levy of taxes to cover the cost of operations and maintenance and to cover debt service payments. Additionally, the School System has decision-making authority, the power to approve selection of management personnel, the ability to significantly influence operations, and primary accountability for fiscal matters. Accordingly, the School System is a primary government and consists of all the organizations that compose its legal entity. As required by generally accepted accounting principles, these financial statements present the School System and its component units, entities for which the School System is considered to be financially accountable. Blended component units, although legally separate entities, are, in substance, part of the School System's operations. Therefore, data from these units are combined with data of the School System. Blended Component Unit Educatiorl Keforrn Success, Irlc., (ERS) (a non-profit corporation) was established by the School Systern for the purpose of providing financing for some of the School System's buildings and equipment. The School System has a voting majority on the Board. ERS has issued certificates of participation (COPS) for the acquisition and construction of facilities and equipment. The COPS are repayable solely from payments made by the SchooI System to ERS under a lease agreement for the related facilities and equipment. Accordingly, the COPS and the related capital assets are reported in the government-wide financial statements. Separate financial statements :orERS arc not prepared. 2. Government-Wide and Fund Financial Staterncnts The government-wide financial statements (i.e., the statement of net assets and the statement of activities) report information on all of the non-fiduciary activities of the School System and its component units. The effects of inter-fund activity have been netted in these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from bzfsiness-type activities, which rely to a significant extent on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly ~dentifiablewith a specific function or segment. Program revenues include 1) charges to applicants who iise, 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 segrnent. 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 are reported as separate columns in the governmental fund financial statements. 3. Measurement Focus, Basis of Accounting, and Financial Statement Presentation The government-wide fmancial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements. The agency fund does not have a measurement focus. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of 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. 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 or soon enough thereafter to pay liabilities of the current period. For this purpose, the School System considers revenues to be available if they are collectecl within 30 clays of the end of the fiscal period. The State of Georgia reimburses the School Systern for teachers' salaries and operating costs through the Quality Basic Education Formula Earnings program (QBE). Generally, teachers are contracted for the school year (July 1 - June 30) and paid over a twelve month contract period, generally September 1 through August 31. In accordancc with the respective rules and regulations of the QBE program, the State of Georgia reimburses the School System over the same twelve month period in which teachers are paid, At June 30, the amount of teachers' salaries incurred but not paid until July and August of the subsequent year are accrued. Since the State of Georgia recognizes its QBE liability for the July and August salaries at June 30, the School System recognizes the same QBE as a receivable and revenue, consistent with symmetrical recognition. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expcnditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Property taxes, sales taxes, intergovernmental revenues and interest 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. All other revenue items are considered to be measurable and available only when cash is received by the School System. The School System reporis the following major government funds: General Fund - The General Fund is the School System's primary operating fund. It accounts For all financial transactions of the School Systern, except those req-&red to be accounted for in another firld. Capital Projects Fund - This fund accounts for resoi~rceswhich are used exclusively for acquiring school sites, constructiiig and equipping new school facilities, and renovating existing facilities. The major revenue sources are proceeds from debt proceeds, bond sales, property tax revenue, special purpose local option sales tax revenues, and aiiiounts received from the State of Georgia. Title I Special Revenue Fund - This fund was established to account for federal grants passed through the Georgia Department of Education 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 School System reports the following major proprietaly -fund: Food Services Fund - The primary purpose of the Food Services Fund is to account for activities of the School System's school breakfast and lunch programs, which are funded primarily by the United States Department of Agriculture, passed through the Georgia Department of Education. Private-sector standards of accounting and fhancial reporting issued prior to December 1, 1989, generally are followed In bo-th the govemneni-wide and proprietary fimd financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private-sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The School System has elected not to follow subsequent private-sector guidance. Proprietary fin'ds 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. Operating expenses for the enterprises fund includes the cost of sales 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. Proprietary fi~ndsand fiduciary filnds employ the economic resources measurement focus and are accounted for on tlze accrual basis. The fiduciary fund accounts for assets held by the School System in a trustee capacity or as an agent on behalf of othcrs. The School System reports the following fiduciary fund: Agency Fund - This fund is used to account for local school student club and class accounts. It is custodial in nature and does not involve measurement of results of operations. The fiduciary fund is excluded from the government-wide financial statements 4. Assets, Liabilities and Net Assets or Equity a. Cash Equivalents The School System c~iisidersall highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Georgia Laws, OCGA 45-8-i4, authorizes the School System to deposit its funds in one or more solvent banks or insured Federal savings and loan associations. b. Investments Investments made by the School System in nonparticipating interest-earning contracts (such as certificates of deposit) and repurchase agreements are reported at cost. Participating interest-earning contracts and money market investments with a maturity at purchase of one year or less are reported at amortized cost. Both participating interest-earning contracts and money market investments with a maturity at purchase greater than one year and equity investments are reported at fair value. The Official Code of Georgia Annotated Section 3683-4 authorizes the School System to invest its funds. In selecting among options for investment or among institutional bids for deposits, the highest rate of return shall be the objective, given equivalent conditions of safety and liquidity. Funds may be invested in the following: 1) Obligations issued by the State of Georgia or by other states 2) Obligations issued by the United States g o v e m e n t 3) Obligations fuily insured or guaranteed by the United States government or a United States governient agency 4) Obligations of any corporation of the United States government 5) Prime banker's acceptances 6) The Local Government Investment Pool administered by the State of Georgia, Office of Treasury and Fiscal Services 7) Repurchase agre,~ m e n t s 8) Obligations of other political subdivisions of the State of Georgia c. Receivables Receivables consist of amounts due from property and sales taxes, grant reimbursements due on Federal, State or other grants for expenditures made but not reimb~irsedand other receivables disclosed f?om information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. d. Inventories and Prepaids Inventories are valued at cost using the first-in, first-out method of accounting. The cosrs of food services fund inventories are recorded as expenditures when consumed (consumption method). Prepaids are payments made to vendors for services that will benefit periods beyond June 30, 2010, are recorded as prepaid items in both government-wide and h n d financial statements. e. Capital Assets Capital assets purchased, including capital outlay costs, are recorded as expenditures in the fund financial statements at the time of purchase (including ancillary charges). On the Government-wide financial statements, all purchased capital assets are valued at cost where historical records are available and at estimated historical cost based on appraisals or deflated current replacement cost where no historical records exist. Donated capital assets are rzcorded at their estimated market 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 asset lives are not included in the cost of capital assets. The School System does not capitalize book collections or works of art. Capitalizati~n thresholds and estimated useful lives of capital assets reported in the government-wide statements and proprietary funds are as follows: Capitalization Policy Estimated Useful Life Land Land Improvements Buildings Building Improvements Furniture and Fixtures Vehicles Eq-uiprnent Capital Leases All $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 S50,OOO N/A 10 to 20 years 20 to 50 years 10 to 30 years 3 to 15 years 5 to 8 years 3 to 15 years 3 to 8 years Capltal assets donated to proprietary fund type operations are recorded at their estimated fair value at the date of donat~onD. epreciation is computed uslng the straight-line method over the est~lnateduseful life of the assets f. Compensated Absences Vacation benefits are accrued as a liability as the benefits are earned if the employees' rights to receive salary relatcd compensation are attributable to services already rendered and it is probable that the School System will compensate the employees for the benefits through paid time off or some other means. Amounts of vested or accumulated vacation leave that are not expected to be liquidated with expendable available financial resources are reported as longterm obligations in the government-wide financial statements and are not liabilities of the governmental funds. g. Long-term Obligations in the governmental-wide financial statements and proprietary fund types in the fund financial statements, long-term debt and other long-te~mobligations are I-eportedas liabilities in the applicable govemr-nental activities or business-type activities statemeni cf net assets. Long-tern debt and other long-term liabilities that will be paid fiom governmental funds are not recognized as a liability in the fund financial statements until due but are reported in the government-wide statements as long-term debt. h. Fund Equity In the fund financial statements, governmental funds report reservations of fund balance for amounts that are not available for appropriations or are legally restricted by outside parties for use for a specific purpose. The following reservations have been established by the School System: Reserved for Capital Projects - resources received from Special Purpose Local Option Sales Tax which has been fonnally set aside for capital projects. Reserved for Debt Service - resources accumulated for future payments of principal and interest on long-term general obligation. Reserved for Board Action /terns - resources of the School System formally set aside for Board approved projects. Reserved for Federal Programs - resources received from various federal agencies that must be spent for specific purposes identified in the grant agreements. Unreserved/Designated for Local Programs - resources received from state (non-QBE) and local funds for specific purposes. Designations of fund balance represent tentative management plans that are subject to change. The School System has made authorized allocation of fund balances for various capital, technology, and operational needs. i. Net Assets Net assets represent the difference between assets and liabilities. Net assets invested in capital assets, net of related dcbt consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowings used for the acquisition, construction or improvement of those assets. Net assets are reported as restricted when there arc limitations Imposed on their use either through external restrictions imposed by creditors, grantors or laws or regulations of other govemnents. The School System applies restricted resources when an expense is incurred for purposes for which both restricted and unrestricted net assets are available. j. Use of Estimates The preparation of financial statements in conforinity with GAAP requires management to make estimates and assumptions that affect the amoiints of assets, liabilities, reveme and expenses including the disclosure of contingent assets and liabilities. Actual amounts could differ from those estimates. Workers Compensation: The School System recognizes in the government-wide statements the liabilities for estimated losses to be incurred from pending worker compensation claims and for worlter compensation claims incurred but not reported (IBNR). B N R claims are estimates of claims that are incurred through the end of the fiscal year but have not yet been reported. These liabilities are based on actuarial valuations. k. DeferredWneamed) Revenue 'She government-wide financial statements use the accrual basis of accounting. Revenue is recognized when earned. Property taxes are recognized as revenue in the fiscal year for which they are levied. Deferred revenues reported it1 governmental fund financial statements represent unearned revenues or revenues, which are measurable but not available and, in accordance with the modified basis of accounting. B. Budgets and Budgetary Accounting Atlanta Independent School System employs zero-based budgeting for budget preparation. The zerobased budgeting process provides for the identification and prioritization of school system activities and resources starting from zero and accumulating to the targeted funding level. Each activity is linked to the goal, objectives and mission of the System and ranked as to its importance. As the proposed budget moves through each level of the organization, program activities and goals are aggregated hrther and ranked again. The final budget produced and presented is one, which includes all program activities ranked in order of importance in reaching the System's mission. Our basis of budget presentation is in accordance with GAAP. The School System follows these procedures in establishing the budgetary data reflected in the financial statements: 1. Budget requests are completed in December. 2. Proposed budgets are consolidated and reviewed by the CFO, and submitted to the Superintendent of Schools and Budget Commission for additional review prior to approval by the Atlanta Board of Education. 3. Public hearings on the proposed budget are held in March and April. 4. The annual budget is legally adopted by the Board in May for the General Fund and Special Revenue Funds in June. 5 . The administrative level of budgetary conti.01 upon adoption is at the program level. The Atlasta Board of Education must approve revisions betweeri salary and non salary expenditures. Transfer of budgeted amounts between object categories within program functions requires the approval of the budget center manager. 6. Revenues and expenditures of the Capital Projects Fund are budgeted on an annual basis. 7. Education Reform Success (ERS) does not have a legally adopted h d g e t 8. The Atlanta Board of Education approves the budget for the Special Revenue Funds as a whole, which is the legal level of budgetary control (the level at which expenditures may not legally exceed appropriations). The combined Special Revenue Funds budget to actual schedule does not include the Proprietary Fund which is included when provided to the board for approval. C. Fund DeficitIExcess Expenditures over Appropriations of Individual Funds The following funds reported excess expenditures over final budget: GENERAL FUND Instruction Sala ry Pupil Services Non-Salary lrr~provementof Instruction Non-Salary Maintenance and Operations Salary Non-Salary Student Transportation Salary Debt Service Principle Interest E38,150,90 1 $4,162,799 SPECIAL R E V E h m FU!W - COMBINED Pupil Services Salary School Administration Salary $5,227,468 $1 14,102 D: Deposits and Investments Risks Deposits (Governmental Funds) The School System's cash and investment policy limits deposits to denland and money market accounts and time deposits at local banks. The School System's deposit shall be secured by Federal Depositary Tnsurancc Corporation (FDIC) coverage and /or bank plcdges. State statutes require banks holding public funds to secure the f i ~ n d sby FDIC insurance, securities pledged at par value, and surety bonds at facc value in combined aggregate totaling not less than 110 percent of the public funds held. State statutes define acceptable security for collateralization. Georgia Fund 1, created by OCGA 36-83-8, is a stable net asset value investment pool which follows Standard and Poor's criteria for AAAm rated money market funds. However, Georgia 1 Fund operates in a manner consistent with Rule 2a-7 of the Investment Company Act of 1940 and is considered to be a 2a-7 like pool. 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 .OO per share value). Net asset value is calculated weekly to ensure stability. The pool distributes earnings (net of management fees) on a monthly basis and determines participant's shares sold and redeemed based on a $1.00 per share value. The fair value of the School System's position in the pool is the same as the value of pool shares ($1 per share value). The regulatory oversight agency for Georgia Fund 1 is the Office of Treasury and Fiscal Services of the State of Georgia. Funds included in this Pool are not required to be collateralized. The fair value of the School System's position in the pool approximates the value of the School System's pool shares. Credit risk, value, and interest risk at June 30, 2010 are as follows: Credit Risk AAAm rated Value $22,057,425 Interest Risk 46 day WAM The School System classifies its investments in Georgia Fund I as cash and cash equivalents Categorization of Deposits As of June 30, 2010, all of the School System's deposits were covered either by FDIC or collateralized by the financial institution or a combination of both. Categorization of Investments The School System's investments as of J u e 30, 2010, are presented below. A!I investments are presented by investment type and debt securities are presented by maturity. Investment T w e Fair Value Investment Maturity Less than One Year Debt Securities U.S. Agencies Implicitly Guaranteed: FNMA, FHLM, FI-ILB Discount Notes 99,490,700 99,490,700 Repurchase Agreements Other Investments Certificates of Deposits U.S. Treasury Money Market Mutual Fcnds (Open End) - cash equivalents Georgia Fund 1 - Cash Equivalents Total Investments 4,999,863 4,999,863 60,970,9 14 22,057,425 257,s 18,902 60,970,9 14 22,057,425 257,5 18,902 - - Investment Reconciliation General Fund Investments Capital Projects Investments Georgia Fund I = Cash Equivalents Total Investments 146,040,335 89,421,142 22,057,425 Reclass to Cash and Cash Equivalents (84,045,585) (63,922,782) (22,057,425) Investments on Balance Sheet as of June 30,2010 6 1,994,750 25,498,360 Interest Rate Risk Interest rate risk is the risk that changes in interest rates of debt investment will adversely affect the fair value of an investment. The School System's investment management policy limits investment matmities to 3 years as a means of managing its exposure to fair vaiue losses arising from increasing interest rates. Custodial Credit Risk Custodial credit risks for investments, is the risk that in the event of the failure of the counterparty, the School System will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. Because of the collateralization requirements, the School System has no custodial credit risk for its investments. Clredit Quality Risk Credit quality risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. The School System's policy for managing credit quality risk related to community bank certificates of deposits and repurchase agreements states such investments will only be purchased through banks having at least an AA rating. The investment policy states Repurchase Agreements may only be purchased from a financial institution that has short-term ratings of AA or higher by Standard & Poor's (S&P) or Aa2 by NLoody's. The investments subject to credit quality risk are reflected below: Rated Debt Tnstrurnents U.S. Treasury Money Market Mutual Funds Georgia Fund 1 - Cash Equivalents Debt Sccurities U S Agenc~es Tmplictly Guaranteed FNMA, FHLM, FHLB D~scounNt otes Certificates oPDepos~ts Repurchase Agreements Total by Quality Rat~ng Fair Value Quality Ratings AAA A l 99,490,700 4,999,863 70,000.000 257,s 18,902 99,490,700 N/A 182,5 19,039 NIA 70,000,000 70,000,000 Concentration of Credit Risk Concentration of credit risk is the risk of loss that may be attributed to the magnitude of a government's investment in a single issuer. The School System does have a policy concerning the composition of its investmznt portfolio and is in compliance with its investment policy. The investment policy establishes, the following eligible investments individually are not to exceed the following corilposition in the portfolios of the General Fund and Capital Projccts Fund: U.S. Treasury Bills Federal Agencies (No more than 40% per issuer) Repurchase Agreements State of Georgia - Georgia Fund 1 Bank Special Purpose Money Market Funds Commercial Paper Certificates of Deposit 100% 65% 3 0% 25% 25% 20% 10% Investments in any one issuer that represents 5% or more of the total investments were as follows as of June 30,2010: Issuer Investment Type % of Total Investments Tri Party Repo Ageement BOFA Government Reserves Capital US MONEY MARKET- Georgia Fund 1 Federal National Mortgage Association Federal Home Loan Mortgage Corporation Federal Home Loan Bank Financial Institutions Repurchase Agreement Money Market Funds Money Market Funds Federal Agency Securities Federal Agency Securities Federal Agency Securities Certificates of Deposits Foreign Currencv Risk Foreign currency risk is the risk that changes in exchange rates will adversely affect the fair value of an investment or deposit. Foreign investments are prohibited by law in Georgia. E. Due from Other Governments Due from other governments conslsts of grant reimbursements due primarily Gom the Georgia Department of Education for expenditures made, but not yet reimbursed and amounts due from City of Atlanta for bonds issued and unspent tax collections, collected and held by the City of Atlanta on behalf of the School System. F. Property Taxes and Other Receivables Property taxes are normally levied and billed by July 1, based on property values assessed as of January 1, on all real and personal property located within the City of Atlanta. Property taxes were billed on August 15, 2010. Property taxes will be due October 15, 2010 at which time they become delinquent and penalties and interest may be assessed and liens may be attached to property. An allowance has been established for estimated amounts that will not be collected. The School System considers revenues to be available if they are collected within 30 days of the end of the current fiscal year. General Fund Property Taxes Receivable 27,820,682 Allowance for Uncollectible Net Property Taxes Receivable (9,987,555) 17,833,127 General Fund Other Receivable 878,833 A!lowance for Uncollectible (450,000) Net other Receivable 428,833 Capital Projects Fund SPLOST Tax Receivable 12,464,357 Allowance for Uncoliectible Net SPLOST Tax Receivable 12,464,357 G. Capital Assets The following is a summary of changes in the Capital Assets during the fiscal year: Governmental activities: Land Construction in Progress Change in Restated Beginning Accounting Betuning Uecreasa & Ending Balance Entity Balance (see NoteR) Increases Transfers Balance Total iYon-Depreciable Assets Buildings Buliding lmprovements Land improvements Eqilipmenl Furniture & Fixlures Vehicles Charter Schools Tolal Depreciable assets Total at historical cost less Accumulated Depreciation Buildings Buliding improvements Land improvements Equipment Furniture & Fixbra Vehicles Charter Schools Total accumulated deprecialion 261,384,860 (2,328,280) 259,056,580 29,202,128 (1,550,044) 286,708,664 Governmental activities capital assets, net l,C111,977,926 (4,145,530) 1,007,832:396 202,720,002 (1 11,352,553) 1,099,199,845 Depreciation expense was charged to governmental functions as follows: Instruction S 24,233,507 Support Services Pupil Services 140,376 Educational Media 41,457 Business Administration 1,074,726 Maintenance and operation of facilities 109,514 Student transportation Total H. Long-term Debt Capital Leases The School System has entered into various equipment lease agreements. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of inception. In 2008, the School System entered into a lease agreement for the purchase of various capital assets in the amount of $20,000,000. These leases were advanced funded. As of June 30, 2010, all the advance funds have been used to purchase capitalized assets. The capital assets acquired through capital leases are as follows: Buses Asset Governmental Activites $ 11,136,550 Less: Accumulated depreciation Net Capital Assets The following is a schedule of the future minimum lease payments under capital leases and notes payables and the total present value: Fiscal year Ending Total rnlnlmuln payments 201 1 2032 2013 2014 2015 20 16-2020 Governmental Activites 4,83 1,055 2,129,354 2,129,354 1,470,357 1,470,357 3.770,186 15,800,663 Less: Amount representing lntcrest (1,802,167) Present value o f ~ n i n i m u mpayments $ 13,998.496 In FY2009, the School System increased its capitalization threshold fiom $5,000 to $50,000. Some assets purchaseti .were less than the threshold an'd therefore are not reflected in the net capital assets shown above. Intergovernmental Agreemen1 Over the years, the City of Atlanta has issued various annual general obligation bonds and general obligation refunding bonds on behalf of the School System. The debt service for the bonds has been funded through the School System's bonded debt portion of the annual tax levy. The bonded debt portion of property taxes collected by the City on behaif of the School System is retained by the City and used to pay the annual debt service on the outstanding bonds. The debt service payments are calculated using assumptions and estimates based on inhrmaiion available. As of June 30, 2010, $1,868,741 is available and held by the City. General Obligation Bonds currently outstanding at the City of Atlanta on behalf of the School System are as follows: Purpose Governrnerltai activities - Interes- t Rate 3-5% In prior fiscal years, the City of Atlanta School System defeased certain bonds by placing funds in an irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust account assets and the iiability for the defeased bonds are not included in the School System's basic financial statements. At June 30, 2010, $64,580,000 of bonds is outstanding and is considered defeased. I. Loalg-Term Obligations Changes in long-term obligations during the fiscal year ended June 30,2010, were as follows: I. Long-term Obligations Governmental actlvltles: Long-term debt Capital leases $ Capital leases - Chaner Schools Intergovernmental agreement- City of Atlanta Educatrot~Reform Success, Inc (COPS) Total long-term debt Beginning Balance 18,157,127 $ 98,26 I 20,488,750 9,565,000 48,309,138 Change in Reoon~neE n t m - (98,261) (98,261) Balance as restated (Note R) S 18,157,127 S 20,488,750 9,565,000 48,210,877 Add~tions Deductions Ending Balance Amounts Due withln One Year - $ (4,158,631) $ 13,998,496 $ 4,316,491 (1,026,875) (570,000) (5,755,506) 19,46 1,815 8,995,000 42,455.371 1,022,875 595,000 5,934.366 Other long-ten11liabilities Notes payable - Charter Schools Ccmpensated absences Contingent legal liabilitites Contingent liabilit~es-sales tax refund Contingent liabilities - SPLOSJ refurid Workers' compensation Total other long-tern liabilities 1,526,GG1 5,308,512 5,752,655 7,826,556 20,4 14,384 (1,526,66 1) (1,526,66 1) 5,308,5 12 5,752,655 7,826,556 I 8,887,723 2,857,774 2,526,157 29,064,201 1.13 1,413 35.579,546 (2,362,673) (3,161,500) - (2,575,93 1) (8,100,104) 5,803,613 2,591,155 2,526,157 29,064,201 6,382.039 46,367,165 2,604,869 2,526,157 2,312,615 7,443,641 Total long-term obllgat~ons S 68,723.522 S (1,624,922) $ 67,098,600 S 35,579,546 3 (13,855,610) S 88,822,536 S 13,378,007 Note: The General Fund has been typically used to liquidate the l ~ a b ~ lf~otrycompensated absences, contingent llabllit~esand worker's compensation At June 30, 2010, payments due by fiscal year, which includes principal and interest for these items, are as follows: Fiscal Year Ending Capital Leases Pr~ncipal lnterest Intergovernmental Agreements C ~ t yof Atlanta Principal Interest Education Reform Success, Inc. Certificates of Participation Principal Interest Total Principal and Interest $ 13,998,496 $ 1,802,167 % 19,461,875 $ 7,542,811 $ 8,995,000 $ 2,591,468 J. Inter-fund Receivables and Payables Inter-fund receivables and payables net balances as of June 30, 2010 are as follows: Due from other funds Due to other funds Governments Funds General Fund $ - $ 19,276,370 Capital Projects Fund 32,663,483 Title I Fund 18,279,802 Nonmajor Governmental Funds 1 1,034,442 3,5 19,436 Business- Type Fund Food Service Fund During the course of its operations, the School System makes transfers between funds to finance operations, provide services: and acquire assets. To the extent that certain transfers among funds had not been received as of year-end, balances of inter-fund amounts receivable or payable have been recorded. It is management's intent to repay inter-fund balances within the next fiscal year. K. Inter-fund 'Transfers Transfers within the governmental funds for the year ended June 30,2010 are as follows: Governmental funds: General Fund C-a-r.ital Projects Fund Nonmajor Governmental Funds Transfers In Transfers Out Transfers are used to move local funds from the General Fund to the Capital Projects Fund to fund construction projects and are used to fund deficit h ~ badlances in the Noniajor governmental finds. L. Risk Management The School Systern is exposed to various risks of losses related to torts, theft of, damage to, and destruction of assets; errors and omissions; injuries to employees and natural disasters. The School System is self-insured for workers' compensation claims and unemployment compensation. The School System purchases commercial insurance in amounts deemed prudent by management for a11 other risks of loss. Settled claims have not yet exceeded purchased commercial insurance coverage in any of the past three years. -Unemployment Compensation: The School System is self-jnsured for unemployment compensation. The State bills the School System quarterly for the outstanding claims and the School System pays the claims at that time. Changes in the unemployment compensation claims liability during the last two fiscal years are as follows: Beginning of Year LiabiIity Fiscal year 2009 $ - Fiscal year 2010 $ - Claims and Changes in Estimates Claims Paid End of Year Liability 3 306,811 $ (306,811) S S 519,930 $ (519,930) $ Workers' compensation: The School System is fully self-insured for workers' compensation claims of its cmployees. The School System accounts for claims within the General Fund wit11 expenditures and liabilities being reported when it is probable that a loss has occurred and the amount of that loss can be reasonably estimated. An accrued liability for the estimated costs of claims and related settlement costs incurred but not paid and/or reported as of year-end is reported on the governmental activities financial statements. The calculation of the present value of hture workers' compensation liabilities is based on a discount rate of 3.5%. Changes in the claims liability during the last two fiscal years are as follows: Balance at Beginning of Year Claims and Changes in Estimates Claim Payments Balance at End of Year Fiscalyear2009 $ 5,409,473 $ 4,991,248 $ (2,574,165) $ 7,826,556 Fiscal year 2010 $ 7,826,556 $ 1,131,414 $ (2,575,931) $ 6,382,039 M. Nonmonetary Transactions The School System received from the United States Department of Agriculture through the Georgia Department of Education approximately $ 1,269,229 in donated food commodities for its lunchroom programs. The federally assigned value of these commodities is reflected as revenue and expense in the Food Services Fund financial statements. N. On-behalf Payments for Fringe Benefits The School System has recognized revenues and expenditures in the amount of $708,723 for health insurance and pension costs paid by the Georgia Department of Education to the State Merit System of Personnel Administration for non-certified personnel on the School System's behalf. 0. Retirement Plans Teachers Retirement System of Georgia (TRS) Plan Description Substantially all teachers, administrative and clerical personnel employed by local school systems of the State of Georga are covered by the Teachers Retirement System of Georgia (TRS), which is a cost sharing multiple employer public employee retirement system sponsored by the State of Georgia. Most School Systems' employees participate in TRS. TRS provides service retirement, disability retirement, and su~vivor'sbenefits for its members. A member is eligible for service retirement after 30 years of creditable service, regardless of age, or after 10 years of service and attainment of age 60. A member is eligible for early retirement after 25 years of creditable service. Early retirement benefits are reduced by the lesser of 1/12 of 7% of each month the member is below age 60, or by 7% of each year or fraction thereof by which the member has less than 30 years of service. Norma1 retirement benefits paid to members are ec~uaIto 2% of the average of the member's two consecutive highest paid years of serv~cemultiplied by the number of years of cred~tableservice up to 40 years. The normal retirement pension is payable monthly for life. Options are availabIe for distribution of the member's monthly pension at a reduced rate to a designated beneficiary on the member's death. Retirement benefits also include death and disability benefits whereby the disabled member or surviving spouse is entitled to receive annually an amount equal to the member's service retirement benefit or disability retirement, whichever is greater. The benefit is based on member's creditable service (minimum of 10 years) and cornpeiisation up to the date cif death. The TRS Board of Trustees has the authority to establish and amend benefit provisions of the pension plan under Title 47, chapter 3. TRS issues a publicly available financial report that includes financial statements and required supplementary information for the Pian. That report may be obtained by calling 404-352-6560 or by accessing iheir website at www.trsga.com. Funding Policy Employees of the School System who are covered by TRS are required to pay 5.25% of their gross earnings to TRS. The School System makes monthly employer contributions to TRS at rates adopted by the TRS Board of Trustees as advised by their independent actuary. The employer contribution rate is 9.74% at June 30,2010. Total actual and required contributions were as follows (the School System contributed 100% of the annual required contribution): School System Employees City of Atlanta General Employees Pension Plan Plan Description All permanent employees of the School System who are not covered under the TRS are eligible to participate in the City of Atlanta General Employees' Pension Plan (the "Plan"). In addition, certain School System employees employed prior to July 1, 1979, also participate in the Plan. The Plan provides retirement and disability benefits, annual cost-of-llving adjustments, and death benefits to plan members and beneficiaries. The Plan is an agent multiple-employer pension plan administered by a Board of Trustees, which includes the Mayor of the City of Atlanta or designee, the City's Chief Financial Officer, one member of City Council, one member of the School System, one member elected by eligible employees of the City, one member elected by ellgible employees of the School System, one member elected by retired employees of the School System and one member elected by retired employees of the City. The Board of Trustees has the authority to establish and amend the benefit provisions of the Plan. On December 12,2005, the School System adopted the following changes to the Plan: 1. 10 year vesting; 2. 2.5% benefit multiplier (capped at 80%); and 3. Unreduced retirement at 30 years of service regardless of age. The Plan issues a publicly available financial report that includes financial statements and required supplementary informatioil for the Plan. The report may be obtained by writing or by calling the Plan at: City of Atlanta General Employees Pension Plan 68 Mitchell Street Atlanta, GA Telephone Number: (404) 330-6000 The Plan provides retirement benefits that, initially, are 2% of the employee's highest average monthly base compensation over any 36-month period. A participant may retire at age 65 or, after 15 years of service, at age 60. Cost-of-living increases are awarded annually, u p to a 3% maximum increase. Partial vesting percentages based on years of creditable service and provisions for earIy retirement are included in the Plan. Benefits also may be payable at termination, deatli, or disability. The School System's membership in the Plan as of July 1, 2009 is as follows: Active employees Inactive members Retirees and beneficiaries Total membership 974 43 2,362 3,379 Method Used to Value I~vesimenis Investments are stated at fair value. Fair value of Plan assets at July 1, 2009 was $101,3 15,675. Funding Policy and Annzlal Pension Cost The School System's finding policy is to contribute a percentage of covered employee payroll as developed in the actuarial valuation for the Plan. Obligations to contribute to the Plan are established by the Board, subject to minimum financing standards established by the State of Georgia. Active participants are required to contribute 7% of pay (8% if participant has a covered beneficiary or is married). 'The School System's contribution percentage is the actuarial determined amount necessary to fund ?Ian benefits after consideration of employee contributions. The actuarial detcrmlned contribution amount is the sum of the annual normal cost (determined under the entry age normal actuarial cost mcthod) and the amortization of the unhnded actuarial accrued liability as a level percentage of fbture payrolls (over 40 years from January I , 1979) The rema~ningamortization period is closcd 16.5 years remaining as of July 1, 2009. The most current valuation reflects a change in the Plan year from January I , through December 3 1 to July I , to June 30. The Plan's annual pension cost for the current year, based on actuarial valuations perfomled as of July I , 2009 and related information for the Plan is as follows: Contribution rates as a percent of covered payroll: Employee Employer Annual required contribution Employer contributions made Actuarial valuation date Actuarial cost method Amortization method Actuarial assumptions: Investment rate of return Projected salary increases: Inflation Merit or seniority and productivity Post retirement benefit increases 7/1/2009 Entry age normal Level % of payroll 8.0% per year 3.O% per year 4.5% per year N/ A The asset valuation method used is the actuarial value from the prior year plus net new money plus 20% of the asset appreciatioddepreciation for the current yeas and each of the prior four years. Three-'Year Trend Infolmation is as follows: Year 2008 Annual Pension Cost (APC) $39,407,53I % of APC Contributed 138% Net Pension (Asset)/Obligation ($4,842,347) Net Pension Asset - The School System's actuarially required contribution, pension cost, and increase in the beginning net pension asset for the year ended June 30, 2010, were computed as follows: Actuarially required contribution Interest on net pension asset ARC adjustment Annuai pension cost Actual contributions made Increase in net pension asset Net pension asset, June 30,2009 Net pension asset, June 30, 2010 $ 43,584,939 (58 1,804) 556,965 43,560,100 (45,500,000) 1,939,960 7,272,550 $ 9,212,450 Plan Funded Status - The School System's funding status based upon the most recent actuarial valuation is as follows: Actuarial Valuation Date 7/1/2009 Actuarial Value of Assets* (a) $1 12,295,208 Actuarial Accrued Liability Unfunded (AAL) A AL Entry Age (UAAL) (b) (b-a) $644,788,188 $532,492,980 Funded Ratio (db) 17.42% Covered Payroll (c) $29,404,892 U A AL use as a Percentage of Covered Payroll ((b-a)/c) 181 0.90% The schedule of funding progress, presented as RSI following the notes to the financial statements, presents multi-year trend inforrnation about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liability for benefits. Actuarial valuations involve estimates of the value of reported amounts and assumptions about the probability of events far into the future, and actuarially determined amounts are subject to continual 8.evision as results are comparcd to past expectations and new estimates are made about the hture. Actuarial calculations reflect a long-term perspective. Calc~lati~onasre based on the substantive plan in effect as of July 1,2009. P. Post Employment Benefits Georgia Retiree Health Benefit Fund Plan Description. The Georgia School Personnel Post-employment Health Benefit Fund (School OPEB Fund) is a cost-sharing multiple-employer defined benefit postemployrnent healthcare plan that covers eligibIe former employees of public school systems, libraries and regional educational service agencies. The School OPEB Fund provides health insurance benefits to eligible former employees and their qualified beneficiaries through the State EmpIoyees Health Insurance Plan administered by the Georgia Department of Community Health. The Official Code of Georgia Annotated (OCGA) assigns the authority to establish and amend the benefit provisions of the group health plans, including benefits for retirees, to the Board of Community Health (Board). The Georgia Department of Community Health issues a publicly available financial report that includes financial statements and required supplementary information for the School OPEB Fund. That report may be obtained from the Georgia Department of Community Health at 2 Peachtree Street, Atlanta, Georgia 30303. Funding Policy. The contribution requirements of Plan members and participating employers are established by the Board in accordance with the current Appropriations Act and may be amended by the Board. Contributions of Plan members or beneficiaries receiving benefits vary based on Plan election, dependent coverage, and Medicare eligibility and election. On average, Plan members pay approximately twenty-five percent (25%) of the cost of health insurance coverage. Participating employers are statutorily required to contribute in accordance with the employer contribution rate established by the Board. This contribution rate is established to fund all benefits due under the health insurance plans for both the active and retired employees based on projected pay-as-you-go financing requirements. Contributions are 1101: based on the actuarially calculated annual required contribution (ARC) which represents a level of funding that, if paid on an on-going basis, is projected to cover normal cost each year and amortize any unhnded actuarial liabilities (or funding excess) over a period not to exceed thirty years. The employer contribution rates for the combined active and retiree plans for the fiscal year ended June 30, 20 10, were as follows: Certified Employees July 2009-August 2009 18.534%of state-based salaries for August & September coverage September 2009 - November 2009 14.492%of state-based salaries October - December coverage December 2009 - June 20 10 18.534%of state-based salaries for January - July covera,ge Non-Certificated Employees $162.72per month The School System's contribution to the health insurance plans for the fiscal years ended June 30, 2010, June 30, 2009, and June 30, 2008 were S 38,330,627, 530,600,143, $34,489,793 respectively, and which equaled the required contributionIannua1 OPEB cost. Q. Commitments and Contingencies Construction Commitments The School System has active construction projects as of June 30, 2010. The projects relate to construction and renovation of school buildings. At year-end, the School System's commitments with contractors were $40,462,7 11. tiligation and Other Contingencies The School System is a defendant in various lawsuits, which arose, in the ordinary course of its activities. The School System believes its liability in these matters is $2,591,155. Amounts received or receivable principally from the Federal government are subject to audit and review by grantor agencies. This could result in requests for reimbursement to the grantor agency for any costs which are disallowed under grant terms. The School System believes that such disallowances, if any, will be immaterial to its overall financial position. The School System is a recipient of SPLOST revenues. The Georgia Department of Revenues performs audits of vendors and refunds may become due. The School System believes its liability in this matter is $2,526,157. R. Restatements - Change in Accounting Entity A component unit that provides benefit to outside parties does not qualifjl for blending pursuant to GASB Statement 14 paragraph 53b. Charter schools do not serve Atlanta Public Schools as an administrative entity. Rather, they provide benefits to students who reside with the Atlanta Public School's district. Charter schools were previously included in the financial statements as blended component units. Upon calculation of these potential component units as dscreetly presented, it was determined that they were not material to the reporting entity and thus are no longer included in the financia? statements. Due to this change in acccunting entity, a restatement of the June 30, 2009 net assets is required. June 30, 2009 net assets have been adjusted as shown below: Governmental activities net assets as previously reported Change in Reporting Entity - Charter schools: change in current assets and revenues change in curxent liabilities arid expenses capital assets, net of accilrnulated depreciation !ong-term debt Governmental activities 2009 net assets restated $ 1,287,267,432 $ 1.280.735.733 Additionally, due to this change in accounting entity, a restatement of the June 30, 2009 fund balance for non major governmental funds is rcquircd. June 30,2009 fund balance has been adjustcd as shown below: NonMajor Governmental Funds Fund Balance, June 30,2009, as previously reported Change in reporting entity - Charter Schools: change in assets and revenues change in liabilities and expenditures Fund Balance, June 30, 2009, restated AETC was discretely presented for 2009. Due to a change in the contract and as determined by criteria in GASB 14, it is no longer a component unit. Due to this change in accounting entity a restatement of the June 30, 2009 net assets is required. June 30, 2009 net assets have been adjusted as shown below: Discretely presented component unit net assets as previously reported Change in Reporting Entity - Component Unit - AETC change in assets and revenues change in liabilities and expenses Capital assets, net of accumulatecl depreciation Discretely presented component unit 2009 net assets, restated $ 7,066,847 (7,435,264) 757,780 (389,363) $ S. New Accounting Pronouncements GASB Statement (Statement No. 5 1) was irnplernented during the current fiscal year. GASB 5 1 was issued in June 2007 to reduce inconsistencjes in fmancial reporting and provides needed guidance on how to identify, account for, and report intangible assets. GASB 5 1 defines an intangible asset as an asset that possesses all of the following characteristics: -Lack of physical substance; -1Vonfinancial in nature; and -A useful life extending beyond a singIe reporting period. GASB Statement 51 requires those intangible assets to follow the disclosure requirements of capital assets. T. Pollution Remediation Obligations GASB Statement No. 49, Accounting and Financial Reporting for Pollution Remediation Obligations, establishes accounting and financial reporting criteria f a liabilities that address current or potential detrimental effects of existing poiiution by participating in pollotion remechation activities. -When one of five obligating events identified by the GASB occurs, the compcjnents of the expected pollution remediation outlays iiil~stbe estimated and a determination made whether the outlays should be accrued as a liability or capitalized when goods and servlces are acquired, as appropriate. Pollution rcmediation liabilities must be measured based on the pollution remediation ourlays expected to be incurred to settle these liabilities. It must be based on "reasonable and supportable" assumptions of fiiture events that may affect the eventual settlement of the liability, and should be measured and reported at current value. The current value of the liability should be based on applicable federal, state, or local laws or regulations that have been approved, regardless of their effective date and the technology expected to be used for the cleanup. Outlays for pollution remediation obligations should be recognized as liabilities if goods and services used for pollution remediation activities are liquidated with expendable available financial resources (modified accnial accounting). However, pollu.tion remediation outlays should be capitalized in the government-wide or pi-oprietq fund statements when goods and services are acquired for certain specific purposes; these amounts are recorded as expenditures at the fund level. As of June 30, 2010, the School System was the responsible party in the remediation of mold removal, asbestos abatement, expired chemical disposal, paint disposal, tire disposal and air quality testing. A site assessment and preliminary evaluation of required remediation indicated no liability at June 30,2010. The potential iiability is deemed immaterial at this time to record to the School System's financial statements. APS paid $376,836 for current financial year remediation activities. U. Subsequent Event Diiring the planning phase of Educational Local Option Sales Tax (ELOST) IV,it was discovered that the Atl'mta Jndeperuclent School System (APS) and Fulton County Schools had not certified the appropriate distribution of the ELOST TTI proceeds with the Georgia Department of Revenue. The School Districts have entered into a Memorandum of Understanding dated March 1, 2011, whereby APS will reimburse Fulton County Schools $34,065,778 over the remainder of the ELOST III for excess h d s received by APS. The liability at June 30, 2010 is believed to be $29,064,201. This amount is reflected as a liability on the governmental activities financial statements. Repayment will begin on August 15,2011, continue on the 15"' day of each consecutive month thereafter and conclude on July 15,2012. REQUIRED SUPPLEMENTARY INFORlCaATION Allanla b>dcpendent School Syrlem GENERAL FUND Schedule ofReveoues. Ekpend~luresand Change> in Fund Balance - Budzet m d Actual For the Year Endcd Julte 30. 20 I 0 REVENUES Local laxti Salcr c;lx lncomc Investrncnt eamlngs T u ~ t \ o cnhdrges Factl~t)rental fecs Slat< revenues Fcdcml revenues Chargcs tar serviccs Other Toidl lfvcrlucs EXPENDITURES Cumnt IIISINEIIO~ Salary Non-Salary Support SCW~CCS: Pupil seniccs Salary Non-Salary lmproverneof olinslrurlionnl rel.nces Salary Non-Salary Educattonal media Szlary Noa-Salary Gcncral administranon Salary Nan-Salary School admin~slrarion Salary Non-Salary Bu,incrs adm!nistration Salary Non-Salary M a i ~ ~ l e n a n raend operation o f facililies Salary Non-Salary Sludclll lrsnspurtatius Saislry Non-Salary Cenlral supporl Salary Non-Salary Other support scnicer Salary Sari-Szlary Deb1 Sc,.vlcc: Pr~mc~pal Lnlcrcsl Budgeled k11oun15 Onglnal (I1 Final ( I ) (2) Acmal Varlance wttll Final Budget (Over ) Under ECICSS (dcfic~cncylo f revenues over (under) c\pend~mrcs OTHER FINANClNG SOURCES (USES) Proceeds from sale o f c v p ~ l val ssets Tnnsfcn onr NCI chmgc I" rund balrnces Fund Balancc. Beg~nnmgof Year (6,000,000) 157.900.956 163,305,000) (9~1,739,124) 157,900,956 1,221,378 (44,442.0321 (48,171,730) 157,900,956 F U N D BIUAVC t,E N D Oi. YEAR S 15 1,900,956 63,161.832 L09.727,2 17 (1) Original and Flnal bndgct amounts do not m c l i ~ d cbudgetcd revenues or expendrtr~rccofvanoospnnclpal accounts (2) Propeny tares n l d state fund rcvcnucs relaied to chaner schools are budgeted ~nllte lnstnlclton Furlctlon (1.224.178) (1 8.862.068) (46,563,185) (46.565.385) Atlanta Independent School System SPECIAL REVENUE FUND - TITLE I FUND Schedulc of Revenues, Expenditures and Changes in Fund Balance - Budgct and Acn~al For the YearEnded June 30,2010 Revenue Federal funds Expenditures Current Instruction Salary Non-Salary Support services Pupil services Salary Non-Salary Improvement of instructional services Salary Non-Salary General administration Salary Non-Salary School administration Salary Non-Salary Business administration Salary Maintenance and operation of facilities Salary Student transportation Salary Non-Salary Central support Salary Non-Salary Community services Salary Non-Salary Total Expetiditures Deficiency ofrevenues under expenditures Fund Balance, Beginning of Yea1 FUND BALANCE, END OF YEAR Budgeted Amounts Original Final --Actl~al Var~ancew ~ l h Final Budget (Ovcr ) Under Actuarial Valuation Date 1/1/2004 Actuarial Value of Assels* (a) $107,323,985 Atlanta Independent School System Required Supplementary Information For the Fiscal Year Ended June 30,2010 Schedule of Funding Progress Actuarial Acclued Liability PAL) Entry Age (b) $581,45 1,634 Unfbnded AAL (UA AL) (b-a) $474,127,649 Funded Ratio (a/b) 18.50% Covered Payroll (c) $45,898,463 UAAL use as a Percentage of Covered Payroll ((b-a)/c) 1033.00% OTHER SUPPLEMENTARY INFORMATION NONMAJOR GOVERNMENTAL FUNDS Combining and Individual Fund Statements and Schedules: Combining Balance Sheet - Nonmajor Governmental Funds Combining Statement of Revenues, Expenditures, and Changes in Fund Balances - Nonmajor Governmental Funds Schedules of Revemes, Expenditures, and Changes in Fund Balances Budget and Actual - Special Revenue Funds: Title 11Fund Title VI-B Fund Lottery Fund Other Federal Programs Fund Other Special Projects Fund Schedules of Revenues, Expenditures, and Changes in Fund Balances Budget and Actual - Capital Projects Fund Combining Statement of Changes in Assets and Liabilities - Agency Fund NONMAJOR GOVERNMENTAL FUNDS Special Revenue Funds Special Revenue Funds are used to account for the proceeds of specific revenues that are legally restricted for specific purposes. The School System's Special Revenue Funds have been established primarily on the basis of program purpose and include the following funds and primary funding sources: Title I1 Fund was established to account for federal grant funds passed through the Georgia Department of Education, for the purpose of improving teacher quality and increasing the number of highly quality teachers, para-professionals, and principals. Title VI-B Fund was established to account for federal grant funds passed through the Georgia Department of Education, for the purpose of providing special education programs for children in pre-kindergarten through the twelfth grade. Lotterv Fund was established to account for State of Georgia Iottery k n d s passing through the State of Georgia Department of Education for various programs as established by the State. Other Federal Programs Fund was established to account for other federal funds for which separate presentation is not considered necessary. Other Special Projects Fund was established to account for other state and local funds for which separate presentation in not considered necessary. Capital Projects Fund Education Refonn Success Fund was established to account for activities related to the Education Reform Success, Inc., (a non-profit corporation) which was established by the School System for the purposc of providing financing for some of thc School System's buildings and equipment. Atlanta Independent School System Combining Balance Sheet Non-major Govem~ncntalFunds Junc 30.2010 Assets: Restricted cash equivalents Due from othcr govemmenls Due from other funds Tohl Assets Title I1 Special Revetluc Funds Title VI-B Lottery Other Fedcral Programs Other Special Projects Capital Projccts Fund Education Reform SUCCCSS Total Liahlliries: Accounts payable Salaries and benefits payable Due to other funds Due to other governmcnu Total Liabilities Fund Balauces(Dcficits): Rescrvcd for federal 1)rogranu Reserved for local programs Unresewed/designated for local progalns T o h l Fund Balance TOTAL LIABILITIES AND FUND BALANCES Atlanta Independent School Systetn Combining Statement o f Revenues, Expendinues and Changes in Fund Balances Non-nia~orGovemmcnlal Funds For the Year EndedJune 30.2010 REVENUES Slate Federal Other Total Revenues EXPENDITURES Current Inslmction Support servkccs Pupil servtces l~nprovcrnesol f ~nstrucliona~l er\~ices Educational rned~a General administration School adrnlnistration Bus~ncssadrnin~strat~on Maintenanceand operation o f facilities Student mansportallon Ccnwal suppon Olher suppon sewices Dcbl Scrvicc Principal lnletest Tolal Expcnditurcs Exccss(deficiency) orrcvcnues over (under) expenditures O'THER FlhlANCING SOURCES(USES1 Transfers in Transbrs out Total Other Financing Sources~Uses) Nct change In Fund Balances Fund Balances, Beginning of Year as resla~ed FUh'D BALANCES.End of Year Tiilc II t i t l e VI-B Lollcry Programs Pra)ecls SUCCPSS Total Allanta Indcpcndent School System All Spcctal Revenuc Funds Colnb~ned Schcdulc o fRcvenuer, E~pendirurcsand Changes In Fund Balance - Budge! and Actual For !he Year Ended June 30, 2010 REVENUES Local revenues S h l s revenues Fedcral revenucs Other local revenuer Toral revcnucs EXPENDITURES Cu,rcnt Instruction Salary Non-Salary Supporl Services: Pupil services Salary Non-Salrry Improvemen1 of instructional services Snlary Non-Salary Educational media Salary NonSalary General adminislralion Salary Non-Salary School adrmnistrarion Salaly Non-Salary Business administration Salary Non-Salary Maintenance and operation 01 facilities Salary Non-Salary Student transponanon Salary Non-Salary Cenlrnlsupport Salary Non-Salary Orllcr rupporr services Salary Won-Salary Community Services Salary Non-Saldry Nulritlan Salary Non-Salary Debt Service: Toial Expenditures Fkcecs (dclictency) of rcvenua over (under) cnpend~rurcs OTHER FmANCMG SOURCES (IJSrS) Transfcii ~n Trinsfen out Nct cl~angcIn fund balances Fund Balancc. B e g ~ n n ~ nogrYedr Budgeted /irnoun!s OnganaI Flnnl ACIU~I F ~ n a lBudget (Over ) Under (8,695,647) 12.142.702 (18,357,728) 12,142.702 222,) I5 (222.1 , 5 ) (3IO,801) 12,142.70? (222,l IS) 222.1 1 5 (18,046,921) Atlanta independent School System SPECIAL REVENUE FUND - TITLE 11 FUND Schedule of Revenucs, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Endcd June 30.20 I0 Revenue Federal Funds Expend~tures Current Instruction Salary Nan-Salary Support services Pupil services Salary Nan-Salary Improvement of instructional serviccs Sala~y Nan-Salary General administration Salary Nan-Salary School administration Salary Nan-Salary Central support Salary Nan-Salary Budgeted Amounts Or~g~nal Final Excess (deficiency) revenues over(under) expend~tures Fund Balance. Beginning of Year FUND B a A N C E . END OF YEAR Acn~al Variance with F ~ n a lBudget (Over ) Under Atlanta Independent School Systeril SPECIAL REVENUE FUND -TITLE VI-B FUh1D Schedule of Revenues, Expcnd~turesand Changes in Fund Balance -Budge[ and Actual For [he Year Ended June 30, 201 0 Revenue State revenue Federal revenue Total Revenue Expenditures Cu~~ent lnstr~~ction Salary Non-Salary Support sewices Pupil services Salary Non-Salary Improvement of instructional services Salary Non-Salaly General administration Salary Non-Salary Business administration Salary Non-Salary Maintenance and operation of facilities Salary Non-Salaly Student transportation Salary Non-Salary Ccntral support Salary Non-Salary Total Expenditures Excess (deficiency) of revenues over (undcr) cxpendi!urcs Fund Balance, Beginn~ngof Year F W D BALAT-JCE. END OF YEAR Budgeted Amoi~nrs Original Flnal Aclual Varlancc with Final Budgct (Over ) Under Atlanta Independent School System SPECIAL REVENUE FUND - LOTTERY FUND Schedule of Revcnues, Expend~turesand Changes in Fund Balance -Budget and Actual For the Year Ended June 30,2010 Rever~ue Slate Revenue Federal Revenue Total Revenue Expend~iilres C U rIent instruction Salary Non-Salary Support services Pupil services Salary Non-Sala~y Improvement of instructional services Salary Non-Salary School administration Salary Non-Salary Total Expcnd~turcs Deficiency of revenues under expend~tures OTHER FINANCMG SOURCES (USES) Transfers In Ner change In fund balance Fund Balance. Beglnnlng of Year FUND BALANCE. EhrD OF YEAR Budgeted Amounts Or~ginal Final Actual Var~ancew ~ t h Final Budget (Over ) Under Atlanta Independent School System SPECLAL IEVENUE FUND -OTHER FEDERAL PROGRAMS FUND Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Aclual For the Year Endcd June 30.2010 Revenue Local revenue State revenue Federal revenue Total Revenue Expenditures Current Instruction Salary Non-Salaly Support services Pupil services Salary Non-Salary Improvement of inslr~~ctionsaelrvices Salary Non-Salary Educational media Salary Non-Salary General administration Salary Non-Salary Business administration Salary Non-Salary maintenance a n d operation of facilities Salary Non-Salary Student transportation Salary Non-Salary Centra! support Salary Non-Salary Other Support Services Salary Non-Salary Budgered Amounts Onginal Final Actual Excess[deficiency) revenues over(under) expenditures OTI-IW FMANCMG !USES) Transfers out Fund Balance, Beg~nningof Year FUND BALANCE,END OF YEAR Variance with Final Budget (Over ) IJnder Atlanta lndependcnt School System SPECLAL REVENUE FUND - OTHER SPECIAL PROJECTS FIND Schedule of Revenues. Expenditures and Changes In Fluid Balance - Budget and Acnlal For the Year Ended June 30, 2010 Revenue Siate Rcvenue Other Local Revenue Total Revenue Expendirures Current Instruction Salary Non-Salary Support sewices Pupil services Sala~y Non-Salary In~psovemenot finstructjon;tl services Salary Non-Salary Edueationnl medla Salary Non-Salary General administration Salary Non-Salary School adtninislration Salary Non-Salary Business administration Salaty Non-Salary lMaintenance and operation of facilities Salary Non-Salary Student transportation Salary Non-Salary Central support Salary Non-Salary Other Support Scabices Salary Non-Salary Nutrition Salary A'onSalary Debt Service Totftl Expalditures Excess (deiiciency)revenucs over(under) cxpcndin~~.cs OTHER FINANCING SOURCES (USES) Transfers out Net cllang In fund balancc Fund Balance, B e g i ~ i n gof Year FUND BALANCE, END OF YEAR Budgeted Amounrs Original Filial (8,692,824) (8,261,673) -- (8,692,824) (8,261,673) Actual Vnrtance wlth F~nalBudget (Over ) Under (261,216) l8,000,457) -. (261.2 16) (8,000,457) Atlanta [ntlepcndent School Systcm CAPITAL PROJECTS FUND Schcdule of Revenues, Expend~turesand Changcs In Fund Balance -Budget and Achlal For the Year Ended Junc 30, 2010 Revenue Sales tax revenue ltivesllnent Income Other local revenue Total Revenue Expend~tures Current Instruction Salary Nan-Salary Support services General administration Salary Nan-Salary Business administration Salary Non-Salary Maintenance a n d operation of facilities Salary Nan-Salary Student transportation Salary Nan-Salary Central support Salary h'on-Salary Capita1 outlays Salary Nan-Salary Total Exucnd~rures Excess (deficiency) revenues over(under) expenditures OTHER FINANCING SOURCES (USES) Transfer in Net change In fund balance Fund Balancc, Bcginnlng of Year FUND BALANCE, END OF YEAR Budgeted Amounts Or~g~~ial F~nal Actllal Varlance w ~ t h Flnal Budget (Over ) Undcr Atlanta Independent School System Combining Slaienient of Changes in Assets and Liabilities Agency Fund For the year ended June 30,201 0 Assets: Cash and cash equivalcnrs Balance July I . 2009 Additions Deduc~ions Balance June 30.20 10 Liabitities: Due to local schools and student groups $ 881,840 $ 1,656,568 $ 1,637,194 $ 901,214 Quality Basic Education Programs - Program Expenditures General Fund Quality Basic Education Programs: Schedule of Allotments and Expenditures by Program Schedule of Expenditures by Object - Lottery Programs Schedule of Approved Local Option Sales Tax Projects Schedule of State Revenues QUALITY BASIC EDUCATION PROGRAMS - PROGRAM EXPENDITURES The Official Code of Georgia Annotated Sect~on20-2-172 (a) Expenditure Controls for fiscal years 2007 and 2008 state; For each program identified in Code Section 20-2-161, each local School System shall spend 100 percent of fi~nds designated for direct instructional costs on the direct instruct~onacl osts of such program on one or more of the programs identified in Code Section 20-2-161 at the system level, with no requirement that the School System spend any specific portion of such funds at the site where such funds were earned. The following pages are presented for purposes of additional analysis and reflect overall minilnuin expenditure requirements compared to overall program expenditures made by the School System as described above and also reflect minimum program expenditure requirements compared to actual expenditures made by the School System on a program basis. ATLANTA INDEPENDENT SCHOOL SYSTEM B O W OF EDUCATION - GENERAL FUUD QUALITY BASIC EDUCATION P R O C W ( Q B E ) SCHEDULE OF ALLOTMENTS AND EXPENDITURES - B Y PROGRAM YEAR ENDED JUNE 30,2010 Direct Instructional Progrants 101 1 Kindergarten Program 1061 Kindergawn Prognrn-Early, Intervcnnon Progam 102 1 Primary Grades (I -3) Progratn 1071 Primary Grades-Early Intcrvcnlion ( 1 -31 Program 1051 Upper Elemcnlary Grades (4-5) Program 1091 Upper Eleln Grades-Early lnlervent~on(4-5) Program 1031 Middle Grades (6-8) Program 1081 Middle School (6-5)Frogran) 1041 High School General Education (9-12) Progra~n 301 1 Vocalional Laboratory (9-12) Prograrn Students w i ~ hDisabilities 202l Category I 2031 Category U 2041 Ca~egor).Ill 20.51 Ca~egoryI\' 2 0 1 1 Cate~oryV 2 1 1 I Gifted Snidenl - Category V I 221 1 Remedial Educa~ionProgram 5071 Allernalive Education Program 1351 Englislt Speakers of Other Languages (ESOL) TOTAL DIRECT INSTRUCTIONAL PROGRAMS 13 10 Media Center Program 12 10 Staff and Professional Development ALLOTMENTS FROM GEORGIA DEPARTMENT 01: EDUCATION (I)(?) SALARIES ELIGIBLE QBE PROGRAhI COSTS OPERA I'IONS 'TOTAL QBE FORMULA FUNDS I I00 Twenr). days add~tionalInstruction 1320 Pupil Transpnaian 1445 On behalf 1450 Indirect costs - C e n m l Atlmin 1455 Indirect costs - School Admin. - 1457 Indirect costs Facilities M&O 1500 Nurses TOTAL ( I ) Comprised of State Funds plus Local Five Mill Share. (2) Allotments d o not include the impact of t h e State budget austerity reduction. ATLANTA INDEPENDENT SCHOOL SYSTEM Lottery Programs Schedule of Expenditures by Object For the Year Ended June 30,2010 Salaries Employee benefits Professional and Technical Services Employee travel Materials and supplies Pre-Kindergarten Promam ATLANTA INDEPENDENTSCHOOL SYSTEM SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS YEAR ENDED JUNE 30.2010 PROJECT ORIGINAL ESTIMATED COST {I) CURRENT ESTIMATED COSTS (2) AMOUNT EXPENDED IN CURRENT YEAR (3) SPLOST ll Dekalb County Renovations,modifications,additions and equipment for the following facilitres: Crim High School, Coan Middle School. BurgesslPetersonElementary School, East Lake Elementary School. Lin Elemenrary School. Toomer ElementatySchool, and Whitefoord Elemenlaw Fulton County AMOUNT EXPENDED IN PRIOR YEARS (4) PROJECT STATUS 26,443,062 Ongoing New school conslruction, classroom addltionr, renovations,infrastructure improvements,security system improvements,technology Improvements. land acqursilion, site preparation, new staff development and ~nslructronasl upport facilities, new maintenance SPLOST Ill Fulton County 4.706.515 427,372,400 Ongoing Capital outlay projects including new school construction. classroom additions. renovations, infrastructureimprovements,upgrading security system, technology improvements, land acquisilion. slla preparation, providing staff development and instmctional Dekalb County Capital outlay projects consisting of construction. renovations, modifications.addltlonsand equipment for the following facilities. The Howard School, Lin Elementary School and Whitefoord Elementary School and any future updates: Crim High School, Coan 20,511,000 20,511,000 1,455,487 9.754.495 Ongorng (1) The School System's original cost estimate as specified in the resolutioncalling for the Impositionof the Local Optron Sales Tax. (2) The School Sy5tem's current estimate of total cost for the projects. Includes all cosl fiom project inceptionto completion. (3) The voters of Fulton and Dekalb Counties approved the imposition of a 1% sales tax to fund the above projects and retire associated debt. Amounls expended for these projects may include sales tax proceeds, state, local property taxes andlor other funds over the life of the projects. (4) The School System's amounts expended in prior years relaled to the above projects ATLANTA W E P F N D E N T SCHOOL SYSTEM SCHEDUI.E OF STATE REVENUE FISCAL-YEAR EhrDED JUNE 30. 2010 GRANTS Br~ghtirom the Start: Georgia Department of Early Care and Learn~ng Pre-K~ndergartenProgram Educat~onG, eorgia Department of Qualiry Basic Education Direct Instructional Cost Kindergarten Program K~ndergartenProgram - Early lntervent~onProgram Prinlary Grades (1-3) Program Pr~maryGrades - Early Interventto11(1-3) Progra~il Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervent~on(4-5) Program Middle Grades (6-8) Program Mlddle School (6-8) Program H ~ g hSchool General Educar~on(9-12) P r o ~ a l n Vocational Laboratory (9-1 2) Program Students with D i s a b ~ l ~ t ~- Ae sll Catcgor~cs Giftcd Sntdent - Category VI Remed~alEducat~onProgram Alternat~veEducation Program English Speakers ofother Languages (ESOL) Med~aCcnter Program 20 Days A d d ~ t ~ o nIanlstruct~on Staff and Profess~onalDevelopment lndirect Cost Central Admln~stration Scl~oolAdmin~stration Facility Maintena~lceand Operations Categorical Grants Pup11T'ransportat~on Regular Nursing Services Mid-te~mAdjustment Hold-I-larmless Austcrtty Reduct~on Other State Programs Career, Technical and Agrtcu~hlre Charter Schools- APS Georg~aCouncrl for the M s (ACE) Health insurance CTAE M.E. Support Preschool I-land~cappedProxrani Restdenllal Treatment Ccnrcrs Grant Teacllei's Retirement Vocational Supervisors Adult Education Adult L~teracyProject GOVERA"iL1ENTAL FUND TYPES OTHER N O W A J O R GENERAL GOVERNMENTAL FWD FUNDS TOTAL Statistical Section (Unaudited) Atlanta Independent School System Introduction to the Statistical Section (Unaudifed) This part of Atlanla Independent School Systems comprehensive annual financial report presents detailed information as a context for understanding this year's financial statements, note disclosures, and supplementary information. This information is unaudited. Contents Schedule Financial Trends 1-5 These tables contain trend information that may assist the reader in assessing the School System's current financial performance by placing it in a historical perspective. Revenue Capacity Information 6-8 These tables contain information to help the reader assess the School System's two most significant revenue sources: property taxes and sales taxes. Debt Capacity These tables present information that may assist the reader in analyzing 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. As of June 30, 20 10, there is no debt to report. Operating Information These tables contain service indicators that can inform ones' understanding how the information in the School System's financial statements relates to the services the School System provides and the activities it performs. Employee by function data is not included. Demographic and Economic Tnformation These tables present demographic and econoinic inforrnatlon intended (1) to assist users in understanding the socioeconomic environment within which the School System operates and (2) to provide information that facilitates comparisons of financial statement information over time. 14 - 19 Source: Unless otherwise noted, the information in these tables is derived from the comprehensive annual financial report for the applicable year. The School System implemented GASB No. 34 in fiscal year 2002; therefore, tables presenting government-wide financial data include only nine years of information. ATLANTA GhlDEPENDENT SCHOOL SYSTEM Net Asset by Component 1,nst Nine Fiscal Years Scllcdule I Fiscal Year Ended June 30. Govcnrne~ilaAl c t ~ \ ~ ~ t i e s lnvcsled In Capital Assets. Net of Related Dcbt Kcstr~cted Unrestricted Total Gove~nmemaAl ctlv~t~Neset Assels 2002 2003 481,975,764 629,768,301 1,182,792 2004 733,997,697 2005 2006 803,563,172 3,985,606 831,829.656 26,478,370 2007 893,683,101 106.980.587 2008 854,305,957 182,s 17,605 Bus~ncss-Iypc Act~vltlcs Invcstcd ~nCapdal Assets, Net o f Rclated Deb1 Unrestr~cted Total Bualncss-Type Act~v~tiNcsct Asscts 2.720.262 2,887.61 6 3,897,068 5,055,962 5,776,388 8.504.052 Prl~naryGovcrn~~lchnct t ~ v ~ t l c s Inves~edin Capital Assets, Nei of Relaid Debi Ie)/Rc,~,ent.re Covcrnrneillal Acllullirs Inslmcllon Pup11Sclvlccr Impro\ci.>i.nt ollhslrucuonul S a i lrci Educa!,on.l hlcdla serv,c.< Ccilrml Adrn8nisirallon Sc1i.w Adn?~n\i'!rllon But~?c>Ai d m ~ n ~ a l i r l ~ a n M?~nlcnrncc2nd Opcrouoni Pup~Tl ranrpanauon Support Se~n~:cs~Csnl~sl Olilcr Suppon Scwiccs Non-lnslruc!~ona1S c m r c , Enicrpr~srO. pcial~onr Lnlcrrrl Tolal Go\rmmental Acuviilec Nel ( F x p e n m l !iwcn;er Tolal Plimnry C o r e n ~ m c nAr c l ~ v ~ l ~Ner sl E~prnrr Gcncral R<\,cnuc -g.2 a =O 0 0 .-,z2-" - z 8 z", n ;D $- 0 m 2O ; s;E .zu- = 2 L -:0 3.-1 2 ;; f i e m . ; 4: z ~8 7 Tax Year 2000 2001 Sources: ATLANTA INDEPENDENT SCHOOL SI'STE51 TAX MILLAGE RATES LAST TEN FISCAL YEARS Schedule I 2 Maintenance and Operations 23.84 2 1.94 Sinbnp. Bond Fund 0.96 0.12 Total Levy 24.80 22.060 2 1.784 21 569 1 0 524 20.524 22.694 22.694 21.694 2 1.694 Atlanta Public School 2009 CAFR for tax years 2001-2005 Georgia lkpartrnent of Revenue for tax years 2006-2010 Com~nents Millage rate roll-back of S1.09 on every $1.000 levied for Education Decrease of 2.74 ~nillsdue to: o Roll-Back Operating - 1.9 mills o Defeasement Bond Sinking 77 nulls o Roll-Back Bond Sinking .07 mills Decrease of 0.276 mills Decrease o f 0 2 15 mills Decrease of l 05 mtlls No change horn 2004 Increase of 2 17 ~ n ~ l l s 1% change from 2006 Decrcasc of 1 000 mills No changc from ZOOS Informalorn not avallablc lementary Schools ATLANTA INDEPENDENT SCHOOL SYSTEM SCHOOL BUILDINGS, ACREAGE AND CAPACITY June 30,2010 Schedule 13 ATLANTA MDEPENDENT SCHOOL SYSTEM SCHOOL BUILDINGS, ACREAGE AND CAPACITY June 30,2010 Schedule 13 High Schools 1 I I 1 1 1 1 1 Acres Planning SF per Original Renovation Actual Age Effective Age Effectlve Age Sq'Ft' Capacity Student (Construction (2010 basis) Basis (2010 basis.) Fiscal Year Ended, Dcccmber 31.2002 December 31, 2003 December 31, 2004 Dcccniver 3 1, 2005 Junc 30. 2006 Junc 30,2007 June 30, 2008 June 30.2009 June 30, 2010 , Population 428.100 432,900 434.900 442,100 45 1,600 45 1,600 461,956 477,300 480,700 ATLANTA INDEPENDENT SCHOOL SYSTEM DEMOGRAPIllC STATISTICS LAST NINE FISCAL YEARS Schedule 14 Personal Income (thousands of dollars), Per Capita Personal Income, Media11 Age 5 149.83 1 32,925 32.3 153,070 32,739 34 0 162,297 33,838 33 8 173,159 34.825 34.7 184,186 35,846 34 7 184,186 35,846 34.7 196,683 36.309 32.0 198,580 37.744 35.0 199,747 27,380 34.4 School , E111.ollment 55,640 53,485 5 1,358 50,188 49,924 49,707 5 1,377 48,093 48.696 Unemployment Rate, 7 9% 7.7% 7 4% 5.9% 5 3% 4 5% 5 9% 10 3% 10 3% Sources; 1 For years ended December 31, 2002-June 30,2009, Statistical section of the City of Atlanta, Georgia 2009 Comprehensive Annual Financial Report For the Year Ended June 30,2009 2 Atlanta Regional Commision- 2009 Atlanta City population estimate, regional snpashots, population R. housing data. 3 U.S. 1)epartmcnl of Cornn~erce,Bureau or Ecomonic Analysis- 2009 Advance Metropolitan Statistical Area (IdSA) Income summary. Atlanta MSA includes Atlan 4 U.S. Census Bureau, 2009 American Cornmunit) Su:uey,l year estimates, per capita income. Data inc!udes Atlanta MSA 5 U.S. Cenr~lsBureau, 2009 American CnrnrnunitJ Survey,l year estimates, selected population profile; data limited to households. Data includcs Atlanta MSA. 6 Georgia Department of Edvcation; Enrollment by grade level report as of March, 2010 count. 7 Georgia Dcpartmcnt of Lahor; llnemplymcnt data ( monthly not sesonally adjustmcd) in Atlanta MSA for Junc, 2010. Notes: I Inforniation for the period prior to December 31, ZOO2 was not available. Z T h e City of A!lan!s changed from 3 Dccernber 31 k c a l year to a June 30 fiscal y e w in 2006. Flrcal \'ear, ATLANTA INDEPENDENI' SCHOOL SYSTEM GENERAL FUND PER PUPIL COST LAST TEN FISCAL YEARS Schedule I6 Expenditures ' Active Enrollnient ' Cost Per Pupil Enrolled Average Daily Attendance .' Cost Per Pupil Attended Sources: 1 2 3 4 Atlanta lndepetident School System Financial Reports for fiscal year ended June 30,2010 ( flmounts expressed in thousands). GA Departn~enot f Education ,Enrollment by Grade report for FY2010. Enrollment based on the Rlarcli count of each fiscal year. APS Average Daily attendace report as of June 30,2010. Fiscal years 2001-2009 -Statistical section of the 2009 Atlanta Board of Education CAFR. Fiscal Ycar 2001 ATLANTA INDEPENDENT SCHOOL SYSTEM SCHOOL LUNCH PROGRAM LAST TEN FISCAL YEARS MEALS SERVED Schedule 18 Total 7,173,947 7,073,273 -- Free 5,786,478 6,043,275 Reduced 273,307 282,51 1 Paid 1.1 14,162 747.487 Source: Atlanta Public School NoI~.itionDepartment