ATLANTA INDEPENDENT SCHOOL SYSTEM Comprehensive Annual Financial Report For Fiscal Year Ended June 30, 2013 F Y 2 0 1 3 ATLANTA INDEPENDENT SCHOOL SYSTEM Comprehensive Annual Financial Report Table of Contents Fiscal Year ended June 30, 2013 INTRODUCTORY SECTION Page Letter of Transmittal i GFOA Certificate of Achievement vii ASBO International Certificate of Excellence viii List of Principal Officials ix Appointed Officials xiii Organization Chart xiv FINANCIAL SECTION Report of Independent Certified Public Accountants 1 Management's Discussion and Analysis 4 Basic Financial Statements: Government-wide Financial Statements: Statement of Net Position 16 Statement of Activities 17 Fund Financial Statements: Balance Sheet Governmental Funds 18 Reconciliation of Total Governmental Fund Balances to the Net Position of Governmental Activities 19 Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds 20 Reconciliation of Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government-wide Statement of Activities 21 Statement of Net Position Proprietary Fund Food Services 22 Statement of Revenues, Expenses, and Changes in Fund Net Position Proprietary Fund Food Services 23 ATLANTA INDEPENDENT SCHOOL SYSTEM Comprehensive Annual Financial Report Table of Contents Fiscal Year ended June 30, 2013 Basic Financial Statements (Continued): Statement of Cash Flows Proprietary Fund Food Services 24 Statement of Fiduciary Assets and Liabilities 25 Notes to the Basic Financial Statements 26 Required Supplementary Information: Schedule of Funding Progress 53 Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual General Fund 54 OTHER SUPPLEMENTARY INFORMATION Combining and Individual Fund Statements and Schedules: Combining Balance Sheet Nonmajor Governmental Funds 56 Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds 57 Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual All Special Revenue Funds Combined 58 Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Title I Special Revenue Fund 60 Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Title II Special Revenue Fund 61 Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Title VI-B Special Revenue Fund 62 Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Lottery Grants Special Revenue Fund 63 Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Other Federal Programs Special Revenue Fund 64 ATLANTA INDEPENDENT SCHOOL SYSTEM Comprehensive Annual Financial Report Table of Contents Fiscal Year ended June 30, 2013 OTHER SUPPLEMENTARY INFORMATION (Continued) Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Other Special Projects Special Revenue Fund 65 Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual Capital Projects Fund 66 Statement of Changes in Assets and Liabilities - Agency Fund 67 Quality Basic Education Programs - Program Expenditures 68 General Fund Quality Basic Education Program (QBE) - Schedule of Allotments and Expenditures by Program 69 Schedule of Expenditures by Object - Lottery Programs 70 Schedule of Approved Local Option Sales Tax Projects 71 Schedule of State Revenues 72 STATISTICAL SECTION (UNAUDITED) Net Position by Component Schedule 1 73 Changes in Net Position Schedule 2 74 Governmental Fund Balances Schedule 3 76 Changes in Governmental Fund Balances Schedule 4 77 General Fund Expenditures by Function -Schedule 5 79 General Fund Revenues by Source Schedule 6 80 Assessed and Estimated Actual Value of Taxable Property Schedule 7 81 Property Tax Rates All Overlapping Governments Schedule 8 82 Principal Property Taxpayers Schedule 9 83 Property Tax Levies and Collections Schedule 10 84 Comparison of Property Tax Millage Rates Schedule 11 85 ATLANTA INDEPENDENT SCHOOL SYSTEM Comprehensive Annual Financial Report Table of Contents Fiscal Year ended June 30, 2013 STATISTICAL SECTION (UNAUDITED) (Continued) Tax Millage Rates Schedule 12 86 Ratio of Total Debt Outstanding by Type Governmental Activities Schedule 13 87 School Buildings, Acreage, and Capacity Schedule 14 88 Demographic Statistics Schedule 15 90 Principal Employers Schedule 16 91 General Fund per Pupil Cost Schedule 17 92 School Breakfast Program Schedule 18 93 School Lunch Program Schedule 19 94 Number of Schools Schedule 20 95 Enrollment by Grade Level Schedule 21 96 Employees by Function Schedule 22 97 INTRODUCTORY SECTION vii Association of School Business Officials International The Certificate of Excellence in Financial Reporting Award is presented to Atlanta Independent School System For Its Comprehensive Annual Financial Report (CAFR) For the Fiscal Year Ended June 30, 2012 The CAFR has been reviewed and met or exceeded ASBO International's Certificate of Excellence standards Ron McCulley, CPPB, RSBO President viii John D. Musso, CAE, RSBA Executive Director ATLANTA INDEPENDENT SCHOOL SYSTEM List of Principal Officials June 30, 2013 SCHOOL SYSTEM BOARD MEMBERS At-Large Seat 8: Reuben R. McDaniel, III, Chair In May 1999, Reuben R. McDaniel, III was named President/CEO of Jackson Securities, LLC, an Atlanta based investment banking firm. With over 25 years of investment banking experience in finance management, capital markets and municipal finance, McDaniel relies on his proven financial insights, exceptional talents in building relationships, strong analytical background and consummate corporate management skills. Selected as one of Black Enterprises' "75 Most Powerful Blacks on Wall Street," Mr. McDaniel was responsible for transforming the firm from a regional public finance boutique into a national institutional investment bank. Under his leadership, Jackson Securities has sustained double-digit revenue growth and diversified revenue streams by establishing a Corporate Finance Group, Wealth Management Group, and an Institutional Sales & Trading Group. District 2: Byron D. Amos, Vice Chair Byron D. Amos, the CEO of Capacity Builders, Inc. is a native Atlantan who has been involved in community organizing for over 20 years and has established deep-roots in the Atlanta community. As a dedicated father, community leader and resident of Vine City, he has demonstrated a passionate commitment to service that comes from a desire to see the residents of his community grow and prosper. Byron has served as the Chairperson of Neighborhood Planning Unit L and as President of the Vine City Civic Association, Inc. In these positions he served the interests of the community with a deep sense of commitment, dignity, integrity, and dedication over the past several years. As a result of his stewardship, Byron has received many honors and awards, including being recognized as a WATL 36 Unsung Hero as well as an Outstanding Atlantan. Both awards were a testament to his unwavering commitment to community service and leadership. He is also a graduate of the FBI Citizens Academy and the City of Atlanta Citizen Police and Fire Academy. Along with these awards and accomplishments, Byron has had the responsibility of addressing many difficult issues faced by his beloved community. ix District 1: Brenda J. Muhammad Brenda Muhammad is the executive director of the Atlanta Victim Assistance, Inc. (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 families, 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 president and vice president. District 3: Cecily Harsch-Kinnane Cecily Harsch-Kinnane has been involved in Atlanta Public Schools for over ten years. She and her husband, Paul, have three children 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 former middle and high school math teacher and has recently been the coordinator of an after school-mentoring program. She is a native of Atlanta and received a BA in Mathematics from Brown University and has done graduate work in Math Education and Educational Psychology at Georgia State University. District 4: Nancy M. Meister As a parent and stakeholder, Nancy Meister is passionate about the future of the Atlanta Public Schools and has been personally involved in the district for many years and recognizes the importance of public education. She and her husband have watched their children grow and thrive in the Atlanta Public Schools system. As a residential real estate agent, she understands and appreciates the importance of great neighborhood schools, their impact on attracting new businesses to our city and their contribution to the overall sustainable growth of the metro area. x District 5: LaChandra Butler Burks Born and raised in Atlanta, Georgia, LaChandra Butler Burks' passion for children and commitment to education has been evident all of her life. 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. Ms. Burks is a graduate of L.P. Miles Elementary School and C.L. Harper High School and has a Bachelor's Degree from State University of West Georgia, (formerly West Georgia College) and a Masters of Business Administration from Keller Graduate School of Management. LaChandra Butler Burks received most of her political experience from having worked under the leadership of three Atlanta mayors for 13 years. District 6: Yolanda K. Johnson Yolanda Johnson is a proud resident of the Adams 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 committee 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 future. At-Large Seat 7: Courtney D. English Courtney English is a former Atlanta Public Schools middle school teacher and community activist. Born and raised in Atlanta, he is a proud graduate of Morehouse College. English was a founding teacher at the new All-male BEST Academy at Benjamin Carson where he taught seventh grade Social Studies. Ironically, English's lessons were delivered in the same room where he learned the subject content as a student. English is a member of the 2007 Atlanta Corps of Teach for America and now direct his efforts toward enhancing the quality of education for students. As a former teacher, English designed and implemented a unique curriculum to teach "Applied Social Studies," in which students learn the subject through the lens of all academic disciplines. His talents as an educator have been reinforced by his success rate in the classroom. Eighty percent of his students have met learning objectives with at least 80 percent proficiency for two consecutive years on the Criterion Reference Competency Test (CRCT). xi At-Large Seat 9: Emmett D. Johnson Mr. Johnson has proven that he is a person dedicated to making a positive difference. He is committed to serving the need of our youth. He is knowledgeable about educational issues. As a member of the Atlanta Board of Education, Mr. Johnson: Received the 2009 Richard R. Green Award- The Richard R. Green Award, the nation's highest honor for urban education leadership, at the Council of the Great City Schools 2009 Fall conference. The Council represents 66 of the largest urban school districts in the nation, educating 7.1 million students. The Green Award is named in honor of the first African-American chancellor of the New York City school system, who had also headed Minneapolis Public Schools. As the recipient of the Richard Green Award, Johnson received a $10,000 college scholarship to present to a high school senior of his choice in the Atlanta Public Schools or from his high school alma mater. xii ATLANTA INDEPENDENT SCHOOL SYSTEM APPOINTED OFFICIALS JUNE 30, 2013 SUPERINTENDENT Erroll B. Davis, Jr. SENIOR CABINET Charles A. Burbridge....................................................................Chief Financial Officer Michael Grey (Interim)..................................................Chief Human Resources Officer Larry Hoskins......................................................Deputy Superintendent for Operations Alexis Kirijan...................................................Chief Strategy and Development Officer William T. Prescott (Interim)............................................................General Counsel Steve Smith........................................................................Associate Superintendent Karen Waldon..........................................................Deputy Superintendent Instruction David Williamson.....................................................................Chief Information Officer xiii xiv FINANCIAL SECTION Greg S. Griffin STATE AUDITOR (404) 656-2174 DEPARTMENT OF AUDITS AND ACCOUNTS 270 Washington Street, S.W., Suite 1-156 Atlanta, Georgia 30334-8400 March 5, 2014 Honorable Nathan Deal, Governor Members of the General Assembly Members of the State Board of Education and Superintendent and Members of the Atlanta Independent School System INDEPENDENT AUDITOR'S REPORT Ladies and Gentlemen: Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the Atlanta Independent School System (School System), as of and for the year ended June 30, 2013, and the related notes to the financial statements, which collectively comprise the Board's basic financial statements as listed in the table of contents. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. 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 involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. 2013ARL-11 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the financial statements referred to previously present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the Atlanta Independent School System, as of June 30, 2013, and the respective changes in financial position and cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Emphasis of Matter As described in Notes A and S to the financial statements, in 2013, the Atlanta Independent School System adopted new accounting guidance, Governmental Accounting Standards Board (GASB) Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position, and GASB Statement No. 65, Items Previously Reported As Assets and Liabilities, which resulted in a restatement to beginning net position of $1,381,985. Our opinion is not modified with respect to these matters. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis and the required supplementary information, as presented on pages 4 through 15 and pages 53 through 55 respectively, 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 regarding the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Atlanta Independent School System's basic financial statements. The Introductory Section, the Supplementary Information and Statistical Section are presented for the purposes of additional analysis and are not a required part of the basic financial statements. The Supplementary Information on pages 56 through 72 is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the basic financial statements as a whole. 2013ARL-11 The Introductory Section on pages i through xii and the Statistical Section on pages 73 through 97 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, GSG:as 2013ARL-11 Greg S. Griffin State Auditor MANAGEMENT'S DISCUSSION AND ANALYSIS ATLANTA INDEPENDENT SCHOOL SYSTEM Management's Discussion and Analysis For the Fiscal Year Ended June 30, 2013 The discussion and analysis of the Atlanta Independent School System's financial performance provides an overview of the fiscal year ended June 30, 2013. The intent of this discussion and analysis is to examine the School System's financial performance as a whole, identify changes in financial position as well as to provide basic financial statements. The Basic Financial Statements should be reviewed by the readers to enhance their understanding of the School System's financial performance as a whole or as an entire operating entity. The Basic Financial Statements contain the following components: 1) Government-wide financial statements including the Statement of Net Position 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 funds. 3) Notes to the Basic Financial Statements. This report also presents the highlights for the fiscal year ended June 30, 2013 and contains other supplementary information. FINANCIAL HIGHLIGHTS Overall, net position in fiscal year 2013 increased by 2.2% over fiscal year 2012. The 2012 net position was restated due to a change in accounting principle. See Note S for more information on this change. This is evidence of management's ability to maintain a balanced budget and control expenses despite austerity reductions due to economic downturns affecting the District's revenues. The key financial highlights for fiscal year 2013 as represented are the following: Total net position for the School System increased from approximately $1,388.29 million in fiscal year 2012 to approximately $1,419.33 million in fiscal year 2013, an increase of approximately $31.04 million or 2.2% due to revenues exceeding expenses primarily due to budget cuts. Net position increased by approximately $30.31 million for Governmental Activities and increased by $0.73 million for Business-type Activities. Total revenues decreased from approximately $775.09 million in fiscal year 2012 to approximately $768.51 million in fiscal year 2013, a decrease of approximately $6.58 million or 0.9%. Revenue for Governmental Activities decreased approximately $5.58 million while revenue for Business-type activities decreased by approximately $1 million. Total expenses decreased approximately $15.43 million or 2.1% from approximately $752.90 million in fiscal year 2012 to approximately $737.47 million in fiscal year 2013. Expenses decreased in Governmental Activities by approximately $16.41 million and increased by approximately $0.98 million in Business-type Activities. 4 The School System has prepared its annual financial reports according to the Governmental Accounting Standards Board No. 34 financial reporting model, illustrated by the following graphic. OVERVIEW OF FINANCIAL STATEMENTS Government-wide Financial Statements The Governmentwide 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 Position and the Statement of Activities provide information about 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 fiscal year's revenues and expenses regardless of when cash is received or paid. o The Statement of Net Position presents information on all of the Schools System's assets and liabilities, with the difference between the two reported as net position. Increases or decreases in net position 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 position changed during the fiscal year. All changes in the net position are reported as soon as the underlying event giving rise 5 to the change occurs, regardless of the timing of the related cash flows. 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 Position and Statement of Activities for the School System are two distinct kinds of activities: 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. 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 Statement of Net Position (in millions of dollars) Current and other assets Net capital assets Total assets Governmental Activities Res tated 2013 2012 Business-type Activities 2013 2012 Total Primary Government Restated percentage 2013 2012 change $ 333.41 $ 356.53 $ 5.61 $ 5.21 $ 339.02 $ 361.74 -6.3% 1,307.21 1,248.73 0.14 - 1,307.35 1,248.73 4.7% 1,640.62 1,605.26 5.75 5.21 1,646.37 1,610.47 2.2% Long-term debt outstanding Other liabilities 140.90 152.75 - 86.01 69.11 0.13 - 140.90 152.75 -7.8% 0.32 86.14 69.43 24.1% Total liabilities 226.91 221.86 0.13 0.32 227.04 222.18 2.2% Net position Net investment in capital assets Restricted for debt service Restricted for capital projects Restriced for state and local programs Restricted for school construction Unres tricted Total net position $ 1,187.17 0.39 113.88 5.18 0.49 106.60 1,413.71 $ 1,171.49 0.30 65.80 6.26 43.66 95.89 1,383.40 $ 0.14 5.48 5.62 $ 4.89 4.89 $ 1,187.31 0.39 113.88 5.18 0.49 112.08 1,419.33 $ 1,171.49 0.30 65.80 6.26 43.66 100.78 1,388.29 1.4% 30.0% 73.1% -17.3% -98.9% 11.2% 2.2% Total assets increased by roughly $35.90 million or 2.2%. Current and other assets decreased by roughly $22.70 million or 6.3%. Capital assets, net of accumulated depreciation for all governmental activities increased by roughly $58.62 million. The increase primarily represents additions to construction in progress, buildings, building improvements, and equipment less the current fiscal year's disposals and depreciation expense. Long-term debt outstanding decreased by roughly $11.85 million or 7.8%. The decrease was primarily due to scheduled principal payments and the current fiscal year's amortization of the premium related to the Certificates of Participation issued in fiscal year 2011. 6 Table 2 - Condensed Changes in Net Position (in millions of dollars) Governmental Activities Bus ines s -typ e Activities Total Primary Government Res tated 2013 2012 2013 2012 Revenues Program revenues Charges for services $ Operating grants and contributions Capital grants and contributions General revenues Property taxes, levied for general purposes Special Purpose Local Option Sales Tax Investment earnings Grants and Contributions not restricted to specific programs Property taxes levied for debt service Special item - impairment los s 4.54 $ 218.52 4.18 416.36 85.38 0.20 20.94 1.91 (7.93) 1.72 $ 218.28 8.80 1.28 $ 23.13 - 414.32 - 93.70 - 0.13 - 11.62 - 1.11 - - - 1.64 $ 23.77 - - - Restated Percentage 2013 2012 Change 5.82 $ 241.65 4.18 416.36 85.38 0.20 20.94 1.91 (7.93) 3.36 242.05 8.80 414.32 93.70 0.13 11.62 1.11 - 73.2% -0.2% -52.5% 0.5% -8.9% 53.9% 80.2% 72.1% -100.0% Total Revenues Expen s es : Ins truction Support Services: Pupil services Improvement of instructional services Educational media Federal grant administration General administration School administration Business administration Maintenance and operation of facilities Student transportation Central support Nutrition Other support services Interest and fiscal charges 744.10 749.68 24.41 25.41 768.51 775.09 -0.9% 426.04 25.11 42.92 8.87 1.97 14.33 40.65 15.16 80.78 24.89 23.30 0.91 3.01 5.85 406.00 29.54 38.21 8.96 1.12 17.88 30.83 22.61 97.08 29.77 28.38 0.36 13.04 6.42 - 23.68 - - 22.70 - 426.04 - 25.11 42.92 8.87 1.97 14.33 40.65 15.16 80.78 24.89 23.30 24.59 3.01 5.85 406.00 29.54 38.21 8.96 1.12 17.88 30.83 22.61 97.08 29.77 28.38 23.06 13.04 6.42 4.9% -15.0% 12.3% -1.0% 75.9% -19.9% 31.9% -33.0% -16.8% -16.4% -17.9% 6.6% -76.9% -8.9% Total Expenses Change in Net Position Beginning Net Position, as restated Ending Net Position 713.79 730.20 23.68 22.70 737.47 752.90 $ 30.31 $ 19.48 $ 1,383.40 1,363.92 $ 1,413.71 $ 1,383.40 $ 0.73 $ 4.89 5.62 $ 2.71 $ 2.18 4.89 $ 31.04 $ 1,388.29 1,419.33 $ 22.19 1,366.10 1,388.29 -2.1% 39.9% 7 Primary Government Sources of Revenues Total revenues net of special item, decreased $6.58 million or 0.9% from fiscal year 2012 to fiscal year 2013. This change is mainly due to the one-time impairment losses on Sylvan Middle School and E. Rivers Elementary School. Please see Note G for additional information. Program revenues are primarily grant related and account for approximately $251.65 million or 32.8% of total revenues received and include State QBE revenue. General revenues represent the major revenue stream for the School System. They account for 67.3% or $516.86 million of total revenues received in fiscal year 2013. Business-type activities revenues decreased from 2012 to 2013 by $1 million or 3.9%. Revenues decreased due to a decline in participation volume. 8 Primary Government Expenses Total expenses decreased from 2012 to 2013 by 2.1% or $15.43 million. Management continues to forecast spending levels and manage spending throughout the fiscal year. Governmental activities account for 96.8% or $713.79 million of total School System spending. Four groups of activities account for 90.3% or $644.99 million of governmental activities spending: instruction ($426.04 million or 59.7%); pupil services and improvement of instructional services ($68.03 million or 9.5%); administration and business services ($70.14 million or 9.8%); and maintenance and operations ($80.78 million or 11.3%). Business-type activities expenses increased by $0.98 million or 4.3%. Expenses increased due to additional spending for professional services and equipment refresh purchases. 9 Table 3 - Net Cost of Governmental Activities (in millions of dollars) Instruction Support Services : Pupil services Improvement of instructional services Educational media Federal grant administration General administration School administration Business administration Maintenance and operation of facilities Student transportation Central support Other support services Nutrition Interest and fiscal charges Total Expenses Total Cost of Services Net Cost of Services 2013 2012 $ 426.04 $ 406.00 Percentage Change 4.9% $ 2013 308.41 $ 2012 286.97 Percentage Change 7.5% 25.11 42.92 8.87 1.97 14.33 40.65 15.16 80.78 24.89 23.30 3.01 29.54 38.21 8.96 1.12 17.88 30.83 22.61 97.08 29.77 28.38 13.04 0.91 0.36 5.85 6.42 $ 713.79 $ 730.20 -15.0% 12.3% -1.0% 75.9% -19.9% 31.9% -33.0% -16.8% -16.4% -17.9% -76.9% 152.8% -8.9% -2.3% $ 13.24 7.96 6.65 8.11 30.41 11.93 61.13 18.12 17.36 0.54 0.50 2.19 486.55 $ 17.76 7.73 8.96 10.19 23.50 18.50 73.80 21.55 20.42 8.10 - 3.90 501.38 -25.5% 3.0% -25.8% 0.0% -20.4% 29.4% -35.5% -17.2% -15.9% -15.0% -93.3% 100.0% -43.9% -3.0% 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 decrease is attributable to controlled spending combined with a decrease in program revenues. Capital Assets Capital assets, net of accumulated depreciation for governmental activities for the District was approximately $1.30 billion. The following table provides a summary of capital asset activity: 10 Construction in Progress and Buildings SPLOST IV construction programs to renovate or construct academic facilities are in the 12th month of a 60 month program. For more detailed information on the School System's capital assets, see Note G in the Notes to the Basic Financial Statements. Long-term Debt and Obligations Long-term Debt and Obligations related to governmental activities for the District was $140.9 million. The following table provides a summary of long term debt activity: 11 Outstanding long-term debt decreased in the current fiscal year due to scheduled principal payments, the current fiscal year's amortization of the premium related to the Certificates of Participation issued in fiscal year 2011, and an overall decrease in Contingent Liabilities. For more detailed information on the School System's long-term debt, see Notes H and I in the Notes to the Basic Financial Statements. Fund Financial Statements Fund financial statements provide detailed information 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 types of funds: Governmental funds These funds are used to account for most of the School System's basic services and focus on providing cash flow available for spending. These funds include the General Fund, Capital Projects Fund, and other governmental funds of lesser magnitude. Fund accounting statements use the modified 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 This fund consists of services provided by the School System for a fee and employs the full accrual method of accounting in the same manner as the Government-wide financial statements. The School System has one proprietary fund, 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. Fiduciary fund This fund accounts 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. This fund is not included in the Government-wide financial statements because it cannot be used to finance the School System operations. The School System has one fiduciary fund - Agency Funds (Local School, Club, and Class Funds). The following presents a summary of the General Fund, Capital Projects Fund, and other non-major governmental funds by type of revenue for the fiscal year ended June 30, 2013 as compared to June 30, 2012. Table 6 - Revenues and other financing sources (in millions of dollars) Governmental Funds In creas e 2013 2012 (Decreas e) Local taxes Sales taxes income State revenues Federal revenues Investment income Facility rental fees Charges for services Other Proceeds from s ale of capital leas es Proceeds from s ale of capital as s ets $ 413.47 $ 85.98 146.33 67.83 0.20 1.16 3.37 31.59 0.14 445.18 $ 93.10 142.66 75.79 0.13 1.00 0.72 20.72 4.47 0.25 (31.71) (7.12) 3.67 (7.96) 0.07 0.16 2.65 10.87 (4.47) (0.11) Percentage Change -7.1% -7.7% 2.6% -10.5% 53.8% 16.0% 368.1% 52.5% -100.0% -44.0% Total Revenues and other financing sources $ 750.07 $ 784.02 $ (33.95) -4.3% 12 The following table presents a summary of the General Fund, Capital Projects Fund, and nonmajor governmental funds by type of expenditures for the fiscal year ended June 30, 2013 as compared to June 30, 2012. Table 7 - Expenditures (in millions of dollars) Governmental Funds In creas e Percentage 2013 2012 (Decreas e) Change Ins truction Support services Pupil services Improvement of instructional services Educational media Federal grant administration General administration School administration Business administration Maintenance and operation of facilities Student transportation Central support Other support services Nutrition Capital outlays Debt service Total Expenditures $ 384.98 $ 369.98 $ 25.02 42.92 8.83 1.97 14.32 40.65 12.51 77.74 22.57 23.30 3.01 0.91 117.78 16.22 792.73 29.46 38.21 8.91 1.12 17.88 30.83 16.65 98.72 27.60 28.29 13.04 0.36 46.05 13.24 740.34 15.00 (4.44) 4.71 (0.08) 0.85 (3.56) 9.82 (4.14) (20.98) (5.03) (4.99) (10.03) 0.55 71.73 2.98 52.39 4.1% -15.1% 12.3% -0.9% 75.9% -19.9% 31.9% -24.9% -21.3% -18.2% -17.6% -76.9% 152.8% 155.8% 22.5% 7.1% Excess (deficiency) of revenues and other financing sources over (under) expenditures - See Table 6 Transfers in Transfers out (42.66) 5.93 (5.93) 43.68 0.60 (0.60) (86.34) 5.33 (5.33) Fund Balances, Beginning of Fiscal Year 267.81 224.13 43.68 Fund Balances, End of Fiscal Year $ 225.15 $ 267.81 $ (42.66) Analysis of Major Governmental Funds The School System has two major governmental funds: the General Fund and Capital Projects Fund. The General Fund is the general operating fund of the School System and is used to account for all financial resources except those funds accounted for in other funds. The Capital Projects Fund is used for the acquisition or construction of major capital facilities and to account for the bond proceeds restricted to renovation and school construction. 13 General Fund As of June 30, 2013, total fund balance in the General Fund was approximately $85.22 million. This balance includes approximately $2.40 million nonspendable, $0.39 million restricted, approximately $1.14 million committed, $25.30 million assigned, and $55.99 million unassigned fund balance. As a result of operations in fiscal year 2013, the fund balance increased by $3.20 million. The increase in fund balance is attributable to continued diligence in monitoring costs. For Budget to Actual comparison purposes, the General Fund reported excess expenditures over final budget for the following functions: Instruction Salary $8,864,128 Due to additional teachers required to reduce class size from the original plan Non-Salary Pupil Services Non-Salary $3,579,404 $3,176,514 Due to increase in program support for Residential Facilities, Classroom Instruction, Instructional Support CLL and Commencement Exercises Due to school-based supply purchases, which are never budgeted in the General Fund, but are the result of consolidation School Administration Salary $1,001,215 Due to additional Assistant Principals being deployed in schools Maintenance and Operations Non-Salary $789,372 Due to increase in operational cost for utilities and building operations Student Transportation Salary $1,832,042 Due to additional bus drivers required as a result of foregoing implementation of planned walk zones Non-Salary $480,911 Due to higher purchased professional services and transportation services Central Support Salary $1,532 Due to increases in employee benefits Other Support Non-Salary $357,879 Due to an increase in other purchased services for Residential Facilities Nutrition Salary $200,142 Due to increases in employee benefits 14 Capital Projects Fund As of June 30, 2013, total fund balance in the Capital Projects Fund was $131.75 million. This balance includes $2.66 million nonspendable, $113.87 million restricted, and approximately $15.22 million assigned. The fund balance decreased by $1.98 million due primarily to an increase in SPLOST expenditures and a decrease in SPLOST revenues. Other Governmental Funds As of June 30, 2013, total fund balance in Nonmajor Governmental Funds was $8.17 million. This balance included approximately $5.81 million restricted and $2.36 million assigned. In fiscal year 2012, the Education Reform Success Fund (ERS) was presented as a major fund with an ending fund balance of $43.66 million. In fiscal year 2013, the ERS fund balance had significantly declined to approximately $0.63 million resulting in classification as a Nonmajor fund. The fund balance for ERS decreased by approximately $43.04 million in the current fiscal year, with overall Nonmajor funds decreasing by approximately $43.88 million. Current Issues Currently known facts, decisions, or conditions that are expected to significantly affect the financial position or results of operations are as follows: Tax revenues as well as State Quality Basic Education funding have suffered reductions. The continued support of our schools by the public, local community organizations, and businesses continues to be an integral part of our ability to educate our students. Revenue from the Special Purpose Local Option Sales Tax IV was approved by voters in November of 2011 and the funding, which began in August 2012, has facilitated 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. 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 zero-based approach because it has systematically provided a more accurate account of anticipated spending levels for the fiscal year. Details of the General Fund original budget and amended budget are presented in the Financial Section of this report. Requests for Information This financial report is designed to provide a general overview of 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 at 130 Trinity Avenue SW, Atlanta, Georgia 30303. 15 BASIC FINANCIAL STATEMENTS ATLANTA INDEPENDENT SCHOOL SYSTEM Statement of Net Position June 30, 2013 ASSETS Current Assets: Cash and cash equivalents Investments Receivables (net of allowance for uncollectibles): Taxes Other Due from other governments Internal balances Inventory Prepaid items Total Current Assets Noncurrent Assets: Net pension asset Capital Assets: Nondepreciable capital assets Depreciable capital assets, net Total Noncurrent Assets TOTAL ASSETS LIABILITIES Current Liabilities: Accounts payable Contracts payable Accrued liabilities Retainage payable Due to other governments Deposits and unearned revenues Compensated absences payable, current portion Capital leases payable, current portion Certificates of participation, current portion Claims payable, current portion Intergovernmental agreement, current portion Contingent liabilities, current portion Total Current Liabilities Noncurrent Liabilities: Compensated absences payable Capital leases payable Certificates of participation Claims payable Intergovernmental agreement Contingent liabilities Total Noncurrent Liabilities TOTAL LIABILITIES NET POSITION Net investment in capital assets Restricted for: Debt service Capital projects School construction Other state and local programs Unrestricted TOTAL NET POSITION Governmental Activities Business-Type Activities Total $ 178,461,700 $ 72,471,224 6,472,072 $ - 184,933,772 72,471,224 23,763,711 730,575 40,813,981 1,336,387 5,057,301 322,634,879 10,770,550 292,152,244 1,015,056,264 1,317,979,058 1,640,613,937 1,230 237,282 (1,336,387) 232,128 5,606,325 - 141,550 141,550 5,747,875 23,763,711 731,805 41,051,263 - 232,128 5,057,301 328,241,204 10,770,550 292,152,244 1,015,197,814 1,318,120,608 1,646,361,812 21,325,913 15,336,305 42,542,543 6,727,344 75,039 - 3,095,048 1,265,265 6,710,000 2,068,429 1,143,625 315,000 100,604,511 2,089,302 4,753,381 100,721,623 3,368,144 15,167,625 200,000 126,300,075 226,904,586 1,187,165,191 395,553 113,874,603 491,989 5,183,951 106,598,064 $ 1,413,709,351 $ 1,043 - 123,732 - 124,775 124,775 21,326,956 15,336,305 42,542,543 6,727,344 75,039 123,732 3,095,048 1,265,265 6,710,000 2,068,429 1,143,625 315,000 100,729,286 2,089,302 4,753,381 100,721,623 3,368,144 15,167,625 200,000 126,300,075 227,029,361 141,550 1,187,306,741 - 395,553 - 113,874,603 - 491,989 - 5,183,951 5,481,550 112,079,614 5,623,100 $ 1,419,332,451 See accompanying notes to the basic financial statements. 16 ATLANTA INDEPENDENT SCHOOL SYSTEM Statement of Activities For the Fiscal Year Ended June 30, 2013 PRIMARY GOVERNMENT: Governmental Activities: Instruction Support services: Pupil services Improvement of instructional services Educational media Federal grant administration General administration School administration Business administration Maintenance and operation of facilities Student transportation Central support Other support services Nutrition Interest and fiscal charges Total Governmental Activities Business-Type Activities: Food services Total Business-Type Activities Total - Primary Government Expenses Charges for Services Program Revenues Operating Grants and Contributions Capital Grants and Contributions Net (Expense) Revenue and Changes in Net Position Governmental Activities Business-Type Activities Total $ 426,037,447 $ 2,591 $ 113,724,544 $ 3,904,228 $ (308,406,084) $ 25,105,338 42,917,654 8,869,786 1,973,342 14,324,803 40,648,067 15,157,828 80,783,550 24,892,766 23,304,350 3,011,547 910,473 5,851,816 713,788,767 3,373,883 - 1,158,726 - 4,535,200 8,489,114 34,826,333 2,223,907 1,973,342 6,213,208 10,237,170 3,227,896 18,353,454 6,767,808 5,947,248 2,467,522 407,762 3,659,230 218,518,538 135,500 135,650 - 4,175,378 (13,242,341) (7,955,821) (6,645,879) (8,111,595) (30,410,897) (11,929,932) (61,135,720) (18,124,958) (17,357,102) (544,025) (502,711) (2,192,586) (486,559,651) - $ (308,406,084) - (13,242,341) - (7,955,821) - (6,645,879) - - - (8,111,595) - (30,410,897) - (11,929,932) - (61,135,720) - (18,124,958) - (17,357,102) - (544,025) - (502,711) - (2,192,586) - (486,559,651) 23,680,487 1,279,087 23,131,319 - 23,680,487 1,279,087 23,131,319 - $ 737,469,254 $ 5,814,287 $ 241,649,857 $ 4,175,378 (486,559,651) 729,919 729,919 729,919 729,919 729,919 (485,829,732) GENERAL REVENUES: Taxes: Property taxes levied for general purposes Property taxes levied for debt service Special purpose local option sales tax Unrestricted grants and contributions Unrestricted investment earnings Special item - impairment loss (See Note G) Total General Revenues and Special Item Change in Net Position NET POSITION, beginning of fiscal year, restated NET POSITION, end of fiscal year 416,364,236 1,910,601 85,376,919 20,946,374 198,096 (7,928,325) 516,867,901 30,308,250 1,383,401,101 $ 1,413,709,351 $ - 729,919 4,893,181 5,623,100 416,364,236 1,910,601 85,376,919 20,946,374 198,096 (7,928,325) 516,867,901 31,038,169 1,388,294,282 $ 1,419,332,451 See accompanying notes to the basic financial statements. 17 ATLANTA INDEPENDENT SCHOOL SYSTEM Balance Sheet Governmental Funds June 30, 2013 ASSETS Cash and cash equivalents Investments Receivables (net of allowance for uncollectibles): Taxes Other Due from other governments Due from other funds Prepaid items TOTAL ASSETS LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCES LIABILITIES Accounts payable Contracts payable Accrued liabilities Retainage payable Due to other governments Due to other funds TOTAL LIABILITIES DEFERRED INFLOWS OF RESOURCES Unavailable revenues - property taxes Unavailable revenues - intergovernmental TOTAL DEFERRED INFLOWS OF RESOURCES FUND BALANCES Nonspendable: Prepaid items Restricted: Debt service Capital projects Other state and local programs School construction Committed: School based activities Assigned: Fiscal year 2014 operations Capital projects Local school programs Unassigned TOTAL FUND BALANCES TOTAL LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCES General Fund $ 103,969,050 15,532,356 Capital Projects Fund $ 74,358,354 56,938,868 Nonmajor Governmental Funds $ 134,296 - Total Governmental Funds $ 178,461,700 72,471,224 16,617,363 730,575 22,667,851 20,441,951 2,396,733 $ 182,355,879 7,146,348 - 135,650 14,448,415 2,660,568 $ 155,688,203 18,010,480 8,481,946 - $ 26,626,722 23,763,711 730,575 40,813,981 43,372,312 5,057,301 $ 364,670,804 $ 20,091,762 40,630 40,537,892 - 50,000 22,931,944 83,652,228 $ 1,212,908 15,295,675 6,727,344 698,099 23,934,026 $ 21,243 - - - 25,039 18,405,882 18,452,164 $ 21,325,913 15,336,305 40,537,892 6,727,344 75,039 42,035,925 126,038,418 11,531,717 - - 11,531,717 1,950,000 - - 1,950,000 13,481,717 - - 13,481,717 2,396,733 395,553 - 1,139,666 25,300,000 - 55,989,982 85,221,934 2,660,568 113,874,603 - - 15,219,006 - 131,754,177 - 5,183,951 626,285 - 2,364,322 - 8,174,558 5,057,301 395,553 113,874,603 5,183,951 626,285 1,139,666 25,300,000 15,219,006 2,364,322 55,989,982 225,150,669 $ 182,355,879 $ 155,688,203 $ 26,626,722 $ 364,670,804 See accompanying notes to the basic financial statements. 18 ATLANTA INDEPENDENT SCHOOL SYSTEM Reconciliation of Total Governmental Fund Balances to Net Position of Governmental Activities June 30, 2013 TOTAL GOVERNMENTAL FUND BALANCES Amounts reported for governmental activities in the Statement of Net Position are different because: Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds. Nondepreciable Depreciable, net of accumulated depreciation Other long-term assets are not available to pay for current-period expenditures and therefore are deferred in the funds. Accumulated pension contributions in excess of annual required contributions are reported as assets for governmental activities Long-term liabilities are not due and payable in the current period and therefore are not reported in the funds. Accrued interest Bonds premium, net of amortization Capital leases payable Certificates of participation Intergovernmental agreement - City of Atlanta Compensated absences Workers compensation claims payable Contingent liabilities NET POSITION OF GOVERNMENTAL ACTIVITIES $ 225,150,669 $ 292,152,244 1,015,056,264 1,307,208,508 13,481,717 10,770,550 (2,004,651) (1,801,623) (6,018,646) (105,630,000) (16,311,250) (5,184,350) (5,436,573) (515,000) (142,902,093) $ 1,413,709,351 See accompanying notes to the basic financial statements. 19 ATLANTA INDEPENDENT SCHOOL SYSTEM Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds For the Fiscal Year Ended June 30, 2013 REVENUES Local taxes Sales tax income State revenues Federal revenues Investment income Facility rental fees Tuition charges Charges for services Other TOTAL REVENUES EXPENDITURES Current: Instruction Support services: Pupil services Improvement of instructional services Educational media Federal grant administration General administration School administration Business administration Maintenance and operation of facilities Student transportation Central support Other support services Nutrition Capital outlays Debt service: Principal Interest and fiscal charges TOTAL EXPENDITURES EXCESS (DEFICIENCY) OF REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES) Transfers in Transfers out Proceeds from sale of capital assets TOTAL OTHER FINANCING SOURCES (USES) NET CHANGE IN FUND BALANCES FUND BALANCES - BEGINNING OF FISCAL YEAR FUND BALANCES - END OF FISCAL YEAR General Fund $ 413,467,525 - 143,710,200 1,315,257 104,730 1,158,726 2,591 3,373,883 22,242,841 585,375,753 357,322,211 22,019,608 9,408,941 8,824,668 9,308,666 40,638,070 12,066,195 72,915,256 20,444,407 17,392,802 690,246 502,711 - 3,618,823 1,235,668 576,388,272 8,987,481 (5,925,802) 142,566 (5,783,236) 3,204,245 82,017,689 $ 85,221,934 Capital Projects Fund $ - 85,979,568 135,650 - 45,266 - - - - 86,160,484 - 1,085,826 229,868 4,820,089 484,556 4,116,069 74,695,389 5,920,000 1,790,062 93,141,859 (6,981,375) 5,000,000 - 5,000,000 (1,981,375) 133,735,552 $ 131,754,177 Nonmajor Governmental Funds $ - - 2,487,490 66,510,139 48,100 - - - 9,351,958 78,397,687 27,653,041 3,003,658 33,508,713 3,661 1,973,342 3,930,311 9,997 212,973 3,468 1,638,201 1,795,479 2,321,301 407,762 43,083,742 3,659,230 123,204,879 (44,807,192) 925,802 - 925,802 (43,881,390) 52,055,948 $ 8,174,558 Total Governmental Funds $ 413,467,525 85,979,568 146,333,340 67,825,396 198,096 1,158,726 2,591 3,373,883 31,594,799 749,933,924 384,975,252 25,023,266 42,917,654 8,828,329 1,973,342 14,324,803 40,648,067 12,509,036 77,738,813 22,567,164 23,304,350 3,011,547 910,473 117,779,131 9,538,823 6,684,960 792,735,010 (42,801,086) 5,925,802 (5,925,802) 142,566 142,566 (42,658,520) 267,809,189 $ 225,150,669 See accompanying notes to the basic financial statements. 20 ATLANTA INDEPENDENT SCHOOL SYSTEM Reconciliation of Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government-wide Statement of Activities For the Fiscal Year Ended June 30, 2013 NET CHANGES IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS $ (42,658,520) Amounts reported for governmental activities in the Statement of Activities are different because: Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of those assets is allocated over their estimated useful lives as depreciation expense. This is the amount by which capital outlay exceeded depreciation expense in the current period. Depreciation expense Capital outlay In the statement of activities, the loss on the disposal of capital assets is included with instruction expenses. However, in the governmental funds, the proceeds from the sale increase financial resources. Thus, the change in net position differs from the change in fund balance by the net book value of the capital assets sold or disposed. Proceeds from the sale of capital assets Net book value of capital assets disposed Impairment loss on capital assets (see Note G) Revenues in the statement of activities that do not provide current financial resources are reported as deferred revenues in the funds. Property taxes Special purpose local option sales taxes State revenues Other revenues The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. This amount is the net effect of the differences in the treatment of long-term debt and related items. Principal retirement - capital leases Principal retirement - certificates of participation Principal retirement - intergovernmental agreement Amortization of bond premium The current fiscal year's decrease to the net pension asset increases net expenses on the government-wide statement of activities Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. Compensated absences Workers compensation claims payable Contingent legal liabilities Change in accrued interest $ (44,248,449) 114,830,723 (142,566) (4,042,397) (7,928,325) 4,807,312 (602,649) (816,778) (139,790) 1,886,948 6,565,000 1,086,875 767,419 18,967 291,449 1,236,176 65,725 70,582,274 (12,113,288) 3,248,095 10,306,242 (668,870) 1,612,317 CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIES $ 30,308,250 See accompanying notes to the basic financial statements. 21 ATLANTA INDEPENDENT SCHOOL SYSTEM Statement of Net Position Proprietary Fund - Food Services June 30, 2013 ASSETS Current Assets: Cash and cash equivalents Due from other governments Other receivables Due from other funds Inventory Total current assets Noncurrent Assets: Machinery and equipment Less accumulated depreciation Total noncurrent assets TOTAL ASSETS LIABILITIES AND NET POSITION Current Liabilities: Accounts payable Due to other funds Deposits and unearned revenue TOTAL LIABILITIES NET POSITION Investment in capital assets Unrestricted TOTAL NET POSITION TOTAL LIABILITIES AND NET POSITION $ 6,472,072 237,282 1,230 1,583 232,128 6,944,295 149,000 (7,450) 141,550 7,085,845 1,043 1,337,970 123,732 1,462,745 141,550 5,481,550 5,623,100 $ 7,085,845 See accompanying notes to the basic financial statements. 22 ATLANTA INDEPENDENT SCHOOL SYSTEM Statement of Revenues, Expenses, and Changes in Net Position Proprietary Fund - Food Services For the Fiscal Year Ended June 30, 2013 OPERATING REVENUES Charges for services OPERATING EXPENSES Personnel costs Purchased and contractual services Supplies and materials Other operating costs Depreciation TOTAL OPERATING EXPENSES OPERATING LOSS NON-OPERATING INCOME Intergovernmental TOTAL NON-OPERATING INCOME CHANGE IN NET POSITION NET POSITION, BEGINNING OF FISCAL YEAR NET POSITION, END OF FISCAL YEAR $ 1,279,087 3,064,443 17,229,033 2,387,110 992,451 7,450 23,680,487 (22,401,400) 23,131,319 23,131,319 729,919 4,893,181 $ 5,623,100 See accompanying notes to the basic financial statements. 23 ATLANTA INDEPENDENT SCHOOL SYSTEM Statement of Cash Flows Proprietary Fund - Food Services For the Fiscal Year Ended June 30, 2013 CASH FLOWS FROM OPERATING ACTIVITIES Cash received from customers Cash payments to employees for services Cash payments for goods and services NET CASH USED IN OPERATING ACTIVITIES CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES Intergovernmental receipts NET CASH PROVIDED BY NON-CAPITAL FINANCING ACTIVITIES CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition of capital assets NET CASH USED IN CAPITAL AND RELATED FINANCING ACTIVITIES NET DECREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS - BEGINNING OF FISCAL YEAR CASH AND CASH EQUIVALENTS - END OF FISCAL YEAR RECONCILIATION OF OPERATING LOSS TO NET CASH USED IN OPERATING ACTIVITIES Operating loss Adjustments to reconcile operating loss to net cash used in operating activities: Depreciation Changes in assets and liabilities Decrease in accounts receivable Increase in due from other funds Increase in inventories Increase in deposits and unearned revenue Decrease in due to other funds Decrease in accounts payable Net cash used used in operating activities NONCASH NON-CAPITAL FINANCING ACTIVITIES USDA donated food commodities $ 1,303,154 (5,976,103) (20,921,272) (25,594,221) 23,199,859 23,199,859 (149,000) (149,000) (2,543,362) 9,015,434 $ 6,472,072 $ (22,401,400) 7,450 1,086 (1,583) (89,551) 22,981 (2,911,660) (221,544) $ (25,594,221) $ 1,457,458 See accompanying notes to the basic financial statements. 24 ATLANTA INDEPENDENT SCHOOL SYSTEM Statement of Fiduciary Assets and Liabilities June 30, 2013 ASSETS Cash and cash equivalents LIABILITIES Due to local schools and student groups Agency Fund Local School Club and Class Funds $ 414,935 $ 414,935 See accompanying notes to the basic financial statements. 25 NOTES TO THE BASIC FINANCIAL STATEMENTS Atlanta Independent School System Notes to the Basic Financial Statements June 30, 2013 A. Summary of Significant Accounting Policies The financial statements of the School System have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) as applicable to governmental units. The more significant of the School System's accounting policies are summarized below. 1. Reporting Entity The Atlanta Independent School System (School System or the District) was established by the Georgia State Legislature and is composed 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 have a governing body which is substantively the same as the System's governing body and management of the System has operational responsibility for the component unit and; therefore, data from these units are combined with data of the School System. Substantively the same means sufficient representation of the primary government's entire governing body on the component unit's governing body to allow complete control of the component unit's activities. Blended Component Unit Education Reform Success, Inc., (ERS) (a non-profit corporation) was established by the School System 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 School 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 for ERS are not prepared. 2. Government-Wide and Fund Financial Statements The government-wide financial statements (i.e., the Statement of Net Position and the Statement of Activities) report information on all of the non-fiduciary activities of the School System and its component units (if any). As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. However, any interfund services provided and used are not eliminated as this process would distort the direct costs and program 26 revenues reported in the various functions. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from Business-type activities, which rely to a significant extent on fees and charges for support. The Statement of Activities demonstrates the degree to which the direct expenses of a given function or segments are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) fees and charges to applicants who use, or directly benefit from goods, services or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not 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 financial 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 fiscal year for which they are levied. Grants, private donations, and similar items are recognized as revenue in the fiscal year in which 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 collected within 30 days of the end of the fiscal period. The State of Georgia reimburses the School System for teachers' salaries and operating costs through the Quality Basic Education (QBE) Formula Earnings program. State of Georgia law defines the formula driven grant that determines the cost of an academic school year and the State of Georgia's share in this cost. Generally teachers are contracted for the school year (July 1 June 30) and paid over a twelve month contract period, generally September 1 through August 31. In accordance with the requirements of the enabling legislation of the QBE program, the State of Georgia reimburses the School System over the same twelve month period in which teachers are paid, funding the academic school year expenditures. At June 30, the amount of teachers' salaries incurred but not paid until July and August of the subsequent fiscal year are accrued as the State of Georgia has only postponed the final payment of their share of the cost until the subsequent appropriations for cash management purposes. By June 30 of each fiscal year, the State of Georgia has a signed appropriation that includes this final amount, which represents the State of Georgia's intent to fund this final payment. Based on guidance in Government Accounting Standards Board (GASB) Statement No. 33, paragraph 74, the State of 27 Georgia recognizes its QBE liability for the July and August salaries at June 30, and the School System recognizes the same QBE as a receivable and revenue, consistent with symmetrical recognition. 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. Expenditures are generally recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Fund Financial Statements The School System uses funds to segregate transactions related to certain School System functions or activities in order to maintain its financial records during the fiscal year. Fund financial statements are provided for governmental, proprietary, and fiduciary funds. Governmental Funds Governmental funds are those through which most governmental functions are typically financed. Governmental funds employ the financial position measurement focus and are accounted for on the modified accrual basis of accounting at the fund level. Major individual governmental funds are reported in separate columns. All remaining governmental funds are aggregated and reported as nonmajor funds. The School System reports the following major governmental funds: General Fund - The General Fund is the School System's primary operating fund. It accounts for all financial transactions of the School System, except those required to be accounted for in another fund. Capital Projects Fund - This fund accounts for resources which are used exclusively for acquiring school sites, constructing and equipping new school facilities, and renovating existing facilities. The major revenue sources are from debt proceeds, bond sales, the State of Georgia, and special purpose local option sales tax (SPLOST). SPLOST receipts are tax proceeds required to be used for capital outlay for educational purposes as authorized by local referendum. Proprietary Funds- Proprietary funds employ the economic resources measurement focus and are accounted for on the accrual basis. Proprietary funds are used to account for activities that are financed and operated like private business enterprises. Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's ongoing operations. Operating expenses and depreciation for the enterprise fund include 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. 28 In accounting and reporting for its proprietary operations, the School System applies all Governmental Accounting Standards Board (GASB) pronouncements. For the fiscal year ended June 30, 2013, the School System implemented GASB Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements. This statement incorporated into the GASB's authoritative literature certain accounting and financial reporting guidance issued on or before November 30, 1989. The School System reports the following major proprietary 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. Fiduciary Funds Fiduciary funds account for assets held by the School System in a trustee capacity or as an agent on behalf of others. 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 the results of operations. The fiduciary fund is excluded from the government-wide financial statements. 4. Assets, Liabilities, and Net Position or Equity a. Cash Equivalents The School System considers all highly liquid investments with a maturity of three months or less when purchased from authorized financial institutions to be cash equivalents. Georgia Law, OCGA 45-8-14, 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; 29 2) Obligations issued by the United States government; 3) Obligations fully insured or guaranteed by the United States government or a United States government agency; 4) Obligations of any corporation of the United States government; 5) Prime banker's acceptances; 6) The Local Government Investment Pool (i.e., Georgia Fund 1) administered by the State of Georgia, Office of State Treasurer; 7) Repurchase agreements; 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, private donations or other grants for expenditures made but not reimbursed and other receivables disclosed from information available. Receivables are recorded when either the asset or revenue recognition criteria has been met. d. Inventories and Prepaid Items Inventories are valued at cost using the first-in, first-out method of accounting. Donated food commodities are recorded at fair value. The costs of Food Services Fund inventories are recorded as expenditures when consumed (consumption method). Prepaid items are payments made to vendors for services that will benefit periods beyond June 30, 2013 and are recorded as an asset using the consumption method for the prepaid amount and reflecting the expenditure in the fiscal year in which the services are consumed. Prepaid items are recorded in the government-wide and the governmental fund 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 recorded at their estimated fair 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. 30 Capitalization 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 & Fixtures Vehicles Equipment Capital Leases Intangible Assets All $ 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 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 5 to 10 years Capital assets donated to proprietary fund type operations are recorded at their estimated fair value at the date of donation. Depreciation is computed using the straight-line method over the estimated useful life of the assets. f. Compensated Absences The Atlanta Board of Education authorizes annual leave for personnel employed on a twelvemonth basis as follows: Less than then years of service 3.750 hours per pay period; ten to twenty years of service 4.875 hours per pay period; and twenty or more years of service 5.625 hours per pay period. Employees on 220 day assignment prior to May 13, 1986 who continue in said assignment are authorized annual leave as follows: less than ten years of service 1.0227 hours per pay period; ten to twenty years of service 2.0454 hours per pay period; and twenty or more years of service 3.0681 hours per pay period. An employee may accrue annual leave days up to a maximum of 225 hours (30 working days). Vacation benefits are accrued as a liability as the benefits are earned if the employees' rights to receive salary related 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 long-term 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-term obligations are reported as liabilities in the applicable governmental activities or business-type activities statement of net position. Long-term debt and other long-term liabilities that will be paid from 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. 31 h. Fund Equity In the fund financial statements, governmental funds report limitations on the purpose for which all or a portion of the resources of the fund balance can be used. The limitations can vary depending upon their source. Financial statements for governmental funds report up to five components of fund balance: Nonspendable Fund balance amounts that cannot be spent either because they are in a nonspendable form or because they are legally or contractually required to be maintained intact. Restricted Fund balance amounts that can be spent only for specific purposes because of state or federal laws, or externally imposed conditions by grantors or creditors. Committed Fund balance amounts that can be used only for specific purposes determined by formal action by the Board of Education. The Board of Education is the School District's highest level of decision-making authority, and the formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a resolution approved by the Board. Assigned Fund balances are reported as assigned when amounts are constrained by the School System's intent to be used for specific purposes, but are neither restricted nor committed. The Board has expressly delegated the Superintendent or designee (Chief Financial Officer) the authority to assign fund balances for a particular purpose. Unassigned Residual fund balance that has not been restricted, committed or assigned to specific purposes or other funds. The School System reports positive unassigned fund balance only in the General Fund. Negative unassigned fund balances may be reported in all funds. When multiple categories of fund balance are available for expenditure, the School System will use restricted amounts first, and then unrestricted amounts as they are needed. For unrestricted amounts of fund balance, the School System will use fund balance in the following order: committed, assigned, and then unassigned. i. Net Position The School System implemented GASB Statements No. 63, Financial Reporting of Deferred Inflows of Resources, Deferred Outflows of Resources, and Net Position and No. 65, Items Previously Reported as Assets and Liabilities, as of July 1, 2012. These new standards establish accounting and financial reporting for deferred inflows / outflows of resources, and the concept of net position as the residual of all other elements presented in a statement of net position. Net position represents the difference between assets and liabilities in reporting which utilizes the economic resources measurement focus. Net investment in capital assets 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 position is reported as restricted when there are limitations imposed on their use either through external restrictions imposed by creditors, grantors or laws or regulations of other governments. All other net position is reported as unrestricted. 32 The School System applies restricted resources when an expense is incurred for purposes for which both restricted and unrestricted net positions are available. j. Deferred Inflows of Resources In addition to liabilities, the governmental funds balance sheet will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of fund balance that applies to future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The School System has only one type of deferred inflow of resources, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. Accordingly, the deferred inflow of resources, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenue from property taxes and other sources as these amounts are deferred and will be recognized as an inflow of resources in the period in which the amounts become available. k. Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts of assets, deferred outflows of resources, liabilities, deferred inflows of resources, revenue, 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 worker compensation claims incurred but not reported (IBNR). IBNR 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. 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 further 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 normally completed in January. 33 2. Proposed budgets are consolidated and reviewed by the Budget Department, then submitted to the Senior Cabinet of Atlanta Public Schools and Budget Commission for additional review prior to the approval by the Atlanta Board of Education. 3. Public hearings on the proposed budget are normally held in May and June. 4. The annual budget is legally adopted by the Board in June for the General Fund and Special Revenue Funds. 5. The administrative level of budgetary control upon adoption is at the program level. The Atlanta Board of Education must approve transfers between division and programs that are greater than 5% or $1,000,000 (whichever is less). Transfer of budgeted amounts between object categories within programs 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) Fund does not have a legally adopted budget. 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. Excess Expenditures over Appropriations of Individual Funds GENERAL FUND Instruction Salary Non-Salary Maintenance and Operation Non- Salary $8,864,128 $3,579,404 $789,372 School Nutrition Salary $200,142 SPECIAL REVENUE FUNDSCOMBINED General Administration Salary $696,447 Central Support Non- Salary CAPITAL PROJECTS FUND Business Administration Salary $1,195,461 $82,947 Pupil Services Non- Salary $3,176,514 Student Transportation Salary Non- Salary Other Support $1,832,042 $480,911 Non-Salary $357,879 Business Administration Salary $19,926 School Administration Salary $1,001,215 Central Support Salary $1,532 Student Transportation Salary $127,403 34 D. Deposits and Investments Risks Deposits (Governmental Funds) The School System's cash and investment policy limits deposits to demand and money market accounts and time deposits at local banks. The School System's deposit shall be secured by Federal Depositary Insurance Corporation (FDIC) coverage and / or bank pledges. State statutes require banks holding public funds to secure the funds by FDIC insurance, securities pledged at par value, and surety bonds at face 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 AAAf rated money market funds. However, Georgia Fund 1 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 ($1.00 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 the State Treasurer 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, 2013 are as follows: Credit Risk AAAf rated AAAf rated Value $ 30,256,101* 134,296** Interest Risk 43 day WAM 43 day WAM The School System classifies its investment in Georgia Fund 1 as cash and cash equivalents. *Represents funds reported in the School System's General Fund **Represents funds held in the School System's blended component unit, ERS fund, which are held by the U.S. Bank as custodian for the issuances of the Certificates of Participation debt. Categorization of Deposits As of June 30, 2013, 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 June 30, 2013 are presented in this table. All investments are presented by investment type and debt securities are presented by maturity. 35 Investment Type Debt Securities U.S. Agencies Implicitly Guaranteed: FNMA, FHLM, FHLB Discount Notes U.S. Government Notes & Bonds Repurchase Agreements Fair Value Investment Maturity Less than One Year $ 65,958,053 4,503,358 11,000,000 81,461,411 $ 65,958,053 4,503,358 11,000,000 81,461,411 Other Investments Money Market - Cash Equivalents Georgia Fund 1 - Cash Equivalents Municipal Securities Certificates of Deposits Total Investments Investments Reconciliation General Fund Investments Capital Projects Investments Georgia Fund 1 - Cash Equivalents 28,051,626 30,390,397 10,280,389 5,000,000 $ 155,183,823 28,051,626 30,390,397 10,280,389 5,000,000 $ 155,183,823 Total Investments $ 41,187,906 83,605,520 30,390,397 Reclass to Cash and Cash Equivalents $ (25,655,550) (26,666,652) (30,390,397) Per balance sheet As of June 30, 2013 $ 15,532,356 56,938,868 - $ 155,183,823 $ (82,712,599) $ 72,471,224 Interest Rate Risk Interest rate risk is the risk that a fixed income investment's value will decrease due to a change in the absolute level of interest rates. The School System's investment management policy limits investment maturities to 3 years as a means of managing its exposure to fair value 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. 36 Credit 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 Moody's. The U.S. Agencies investments are not required to be rated. The investments subject to credit quality risk are reflected here: Rated Debt Instruments Debt Securities U.S. Agencies Implicitly Guaranteed: FNMA, FHLM, FHLB Discount Notes U.S. Government Notes & Bonds Repurchase Agreements Other Investments Money Market - Cash Equivalents Georgia Fund 1 - Cash Equivalents Municipal Securities Certificates of Deposits Total by Quality Rating Fair Value Quality Ratings AAA AA A/A1 $ 65,958,053 $ 4,503,358 11,000,000 - $ 65,958,053 $ - - 4,503,358 - - - 11,000,000 28,051,626 30,390,397 10,280,389 5,000,000 $ 155,183,823 28,051,626 30,390,397 3,299,435 - $ 61,741,458 6,469,779 - $ 76,931,190 511,175 - $ 11,511,175 NR $ - - - 5,000,000 $ 5,000,000 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 has a policy concerning the composition of its investment portfolio and is in compliance with its investment policy. The investment policy establishes that eligible investments individually are not to exceed the following composition in the portfolios of the General Fund, Capital Projects Fund, and the Education Reform Success 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 Municipal Securities (No more than 5%) Certificates of Deposit 100% 65% 30% 25% 25% 25% 10% 37 Investments in any one issuer that represents 5% or more of the total investments were as follows as of June 30, 2013: % of Total Issuer Investment Type Investments Municipal Bonds Unites States Government Federal Farm Credit Bank Financial Institutions Money Market- Georgia Fund 1 Bank of America Government Reserves Capital Federal National Mortgage Association Federal Home Loan Bank Federal Home Loan Mortgage Corporation Tri Party Repo Agreement Municipal Securities Treasury Bills Federal Agency Securities Certificates of Deposits Money Market Funds Money Market Funds Federal Agency Securities Federal Agency Securities Federal Agency Securities Repurchase Agreement 6.62% 2.90% 3.22% 3.22% 19.58% 18.08% 15.27% 12.57% 11.45% 7.09% Foreign Currency 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 consists of grant reimbursements due primarily from the Georgia Department of Education for expenditures incurred, 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 are due by October 15 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 $ 29,661,952 $ General Fund Capital Projects Fund Other Receivables $ 1,207,376 $ SPLOST Tax Receivables $ 7,146,348 $ Allowance for Uncollectible (13,044,589) Allowance for Uncollectible (476,800) Allowance for Uncollectible - Net Property Receivable $ 16,617,363 Net Other Receivables $ 730,575 Net SPLOST Receivable $ 7,146,348 Food Service Fund Other Receivables $ 1,230 $ Allowance for Uncollectible - Net Property Receivable $ 1,230 38 G. Capital Assets The following is a summary of changes in capital assets during the fiscal year ended June 30, 2013: Governmental Activities: Land Construction in Progress Total Non-Depreciable Assets Beginning Balance $ 107,065,303 76,402,637 183,467,940 Increases Decreases & Transfers to In Service $ - 111,729,577 111,729,577 $ - (3,045,273) (3,045,273) Ending Balance $ 107,065,303 185,086,941 292,152,244 Buildings Building Improvements Land Improvements Equipment Furniture & Fixtures Vehicles Total Depreciable Assets Total at Historical Cost 1,105,944,714 257,501,252 23,243,382 13,389,542 56,030 28,104,831 1,428,239,751 1,611,707,691 215,788 3,466,129 129,305 1,984,211 350,986 6,146,419 117,875,996 (12,870,497) (6,445,122) (540,020) (430,338) (136,191) (20,422,168) (23,467,441) 1,093,290,005 254,522,259 22,832,667 14,943,415 56,030 28,319,626 1,413,964,002 1,706,116,246 Less Accumulated Depreciation Buildings Building Improvements Land Improvements Equipment Furniture & Fixtures Vehicles Total Accumulated Depreciation 277,443,166 52,182,650 9,117,724 8,320,889 17,276 15,886,464 362,968,169 21,772,082 15,531,265 1,331,325 1,850,350 5,603 3,757,824 44,248,449 (5,745,002) (1,746,544) (436,782) (276,183) (104,369) (8,308,880) 293,470,246 65,967,371 10,012,267 9,895,056 22,879 19,539,919 398,907,738 Governmental Activities Capital Assets, Net $ 1,248,739,522 $ 73,627,547 $ (15,158,561) $1,307,208,508 Business-Type Activities: Equipment $ - 149,000 $ - $ 149,000 Less Accumulated Depreciation Equipment - 7,450 - 7,450 Business-Type Activities Capital Assets, Net $ - $ 141,550 $ - $ 141,550 Sylvan Middle School and Rivers Elementary School have been permanently impaired as a result of a 39 significant and unexpected decline in service utility. An impairment loss has been calculated as required by GASB Statement No. 42, Accounting & Financial Reporting for Impairment of Capital Assets and for Insurance Recoveries. The amount of the impairment loss as shown as a special item on the Government-Wide Statement of Activities ($7,928,325) is the total net book value of the buildings. Depreciation expense was charged to governmental functions as follows: Instruction Support Services Educational Media Services Maintenance & Operations Pupil Services Student Transportation Support Services - Business $ 37,897,520 41,457 96,329 82,072 3,482,279 2,648,792 Total $ 44,248,449 Depreciation expense was charged to business-type activities as follows: School Nutrition Program $ 7,450 H. Long-term Debt Capital Leases The School System has entered into various lease agreements for the purchase of equipment. 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. The capital assets acquired through capital leases are as follows: Asset Buses Less: Accumulated depreciation Net Capital Assets Governmental Activities $ 9,899,536 (5,821,857) $ 4,077,679 40 The following is a schedule of the future minimum lease payments under capital leases and the total present value: Fiscal Year Ending Governmental Activities 2014 $ 1,412,990 2015 1,412,990 2016 1,413,062 2017 1,092,703 2018 1,102,634 Total minimum payments 6,434,379 Less: Amount representing interest (415,379) Present value of minimum payments $ 6,018,646 Intergovernmental Agreement 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 maturity date for the bond is December 21, 2027. The bonded debt portion of property taxes collected by the City on behalf 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 information available. As of June 30, 2013, $395,553 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 Governmental Activities Interest Rate 3-5% Amount $16,311,250 In prior fiscal years, the City of Atlanta and the 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 liability for the defeased bonds are not included in the School System's basic financial statements. At June 30, 2013, $48,890,000 of bonds is outstanding, and is considered defeased. Education Reform Success, Inc. (COPS) In October 2006, ERS issued certificates of participation (COPS) on behalf of the School System in the amount of $10,115,000. The proceeds from the certificates were used to finance the renovations and improvements to the Instructional Service Center. In June 2011, ERS issued COPS on behalf of the School System in the amount of $104,415,000, (Series 2011A, $72,460,000), and (Series 2011B, $31,955,000). The proceeds from the certificates will be used to finance the construction and or renovation of North Atlanta High School. Payments are due on March 1 and September 1 of each year until maturity (maturity dates for series 2011A is March 1, 2027 and March 1, 2017 for Series 2011B). Interest rates vary (5.457% - 5.657% for 41 Series 2011A, and 2% - 5% for Series 2011B). I. Long-Term Obligations Changes in long-term obligations during the fiscal year ended June 30, 2013, were as follows: Governmental activities: Long-term debt Capital leases Intergovernmental agreement- City of Atlanta ERS, Inc (COPS, Series 2006/2007) ERS, Inc (COPS, Series 2011A) ERS, Inc (COPS, Series 2011B) Unamortized premium 2011B Total long-term debt Other long-term liabilities Compensated absences Contingent legal liabilities Workers' compensation Total other long-term liabilities Beginning Balance Additions Deductions Ending Balance Amounts Due within One Year $ 7,905,594 $ 17,398,125 7,780,000 72,460,000 31,955,000 2,569,042 140,067,761 - $ (1,886,948) $ 6,018,646 $ 1,265,265 - (1,086,875) 16,311,250 - (645,000) 7,135,000 - - 72,460,000 - (5,920,000) 26,035,000 - (767,419) 1,801,623 - (10,306,242) 129,761,519 1,143,625 670,000 - 6,040,000 - 9,118,890 5,203,317 1,751,176 5,728,022 12,682,515 4,048,895 300,000 1,864,975 6,213,870 (4,067,862) (1,536,176) (2,156,424) (7,760,462) 5,184,350 515,000 5,436,573 11,135,923 3,095,048 315,000 2,068,429 5,478,477 Total long-term obligations $ 152,750,276 $ 6,213870 $ (18,066,704) $ 140,897,442 $ 14,597,367 The General Fund has been typically used to liquidate the liability for compensated absences, contingent liabilities, and workers' compensation. Fiscal Year Intergovernmental Agreements Ending Capital Leases City of Atlanta Principal Interest Principal Interest 2014 $ 1,265,265 $ 147,725 $ 1,143,625 $ 787,004 2015 2016 2017 2018 2019-2023 2024-2027 Total Principal and Interest 1,297,777 1,331,332 1,045,535 1,078,737 - - $ $6,018,646 $ 115,213 81,730 47,168 23,897 - $415,733 $ 1,264,500 1,325,750 1,333,000 1,242,625 6,942,875 3,058,875 $16,311,250 $ 736,419 680,609 621,974 463,107 1,430,510 199,499 $4,919,122 42 At June 30, 2013, payments due by fiscal year, which includes principal and interest for these items, are as follows: Fiscal Year Ending 2014 $ 2015 2016 2017 2018 2019-2023 2024-2027 Total Principal and Interest $ Education Reform Success, Inc. Certificates of Participation 2006/2007 Principal Interest 670,000 $ 700,000 294,640 $ 266,972 730,000 238,066 755,000 207,920 790,000 176,743 3,490,000 367,524 7,135,000 $ 1,551,865 $ Education Reform Success, Inc. Certificates of Participation 2011A Principal Interest - $ - 4,029,142 $ 4,029,142 - 4,029,142 - 4,029,142 - 4,029,142 - 20,145,710 72,460,000 72,460,000 $ 12,276,035 52,567,455 $ Education Reform Success, Inc. Certificates of Participation 2011B Principal Interest 6,040,000 $ 6,340,000 1,301,750 999,750 6,660,000 682,750 6,995,000 349,750 - - 26,035,000 $ - - 3,334,000 J. Inter-fund Receivables Inter-fund Receivables and payables balances as of June 30, 2013 are as follows: Receivable Fund General Fund School Nutrition Fund Capital Projects Fund Nonmajor Governmental Funds General Fund General Fund Payable Fund School Nutrition Fund $ General Fund General Fund General Fund Capital Projects Fund Nonmajor Governmental Funds $ Amount 1,337,970 1,583 14,448,415 8,481,946 698,099 18,405,882 43,373,895 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 fiscal 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. 43 K. Interfund- Transfers Transfers within the governmental funds for the fiscal year ended June 30, 2013 are as follows: Governmental funds: General Fund Capital Projects Fund Nonmajor Governmental Funds Transfers In Transfers Out $ - $ (5,925,802) 5,000,000 925,802 - $ 5,925,802 $ (5,925,802) L. Risk Management The School System 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 all other risks of loss. Settled claims have not yet exceeded purchased commercial insurance coverage in any of the past three fiscal years. Unemployment Compensation The School System is self-insured 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 Claims and End of Fiscal Year Changes in Claims of Fiscal Year Liability Estimates Paid Liability Fiscal year 2012 $ - $ 623,853 $ (623,853) $ - Fiscal year 2013 $ - $ 1,338,999 $ (1,338,999) $ - 44 Workers' Compensation The School System is fully self-insured for workers' compensation claims of its employees. The School System accounts for claims within the General Fund with 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 fiscal year-end is reported on the governmental activities financial statements. The calculation of the present value of future workers' compensation liabilities is based on a discount rate of 3.5%. There have not been any significant changes in insurance coverage from the prior fiscal year. Balance at Beginning of Fiscal Year Claims and Changed in Estimates Claims paid Balance at End of Fiscal Year Fiscal year 2012 Fiscal year 2013 $ 7,258,000 $1,080,663 $ 5,728,022 $1,864,975 $ (2,610,641) $ 5,728,022 $ (2,156,424) $ 5,436,573 M. Nonmonetary Transactions The School System received from the United States Department of Agriculture through the Georgia Department of Education approximately $1,457,458 in donated food commodities for its lunchroom programs. The federally assigned value of these commodities is reflected as revenue and expensed as used 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 $200,726 for health insurance and pension costs paid by the Georgia Department of Education to the Georgia Department of Community Health for non-certified personnel on the School System's behalf. Additionally, $31,854,792 was paid by the Georgia Department of Education to the Department of Community Health for group health insurance on the School System's behalf. O. 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 Georgia 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 survivor's benefits 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 45 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. Normal retirement benefits paid to members are equal to 2% of the average of the member's two consecutive highest paid years of service multiplied by the number of years of creditable service up to 40 years. The normal retirement pension is payable monthly for life. Options are available 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 compensation up to the date of 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 Plan. That report may be obtained by calling 404-352-6500 or by accessing their website at www.trsga.com. Funding Policy Employees of the School System who are covered by TRS are required to pay 6.00% 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 11.41% at June 30, 2013. Total actual and required contributions were as follows (the School System contributed 100% of the annual required contribution): School System $ Employees $ 2013 35,714,946 $ 18,819,379 54,534,325 $ 2012 2011 33,138,997 $ 32,515,502 17,584,629 18,178,891 50,723,626 $ 50,694,393 City of Atlanta General Employee's 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 participates in the Plan. The Plan provides retirement and disability benefits, annual cost-of-living 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 eligible employees of 46 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 information for the Plan. The report may be obtained by writing or by calling the Plan at: GEM Group 225 Peachtree Street Northeast Suite 1460 Atlanta, Georgia 30303 404-525-4191 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, up to a 3% maximum increase. Partial vesting percentages based on years of creditable service and provisions for early retirement are included in the Plan. Benefits also may be payable at termination, death, or disability. The School System's membership in the Plan as of July 1, 2012 is as follows: Active employees Inactive members Retirees and beneficiaries Total membership 763 26 2,253 3,042 Method Used to Value Investments Investments are stated at fair value. Fair value of Plan assets at July 1, 2012 was $110,283,000. Funding Policy and Annual Pension Cost The School System's funding 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 Plan benefits after consideration of employee contributions. 47 The actuarial determined contribution amount is the sum of the annual normal cost (determined under the entry age normal actuarial cost method), and the amortization of the unfunded actuarial accrued liability as a level percentage of future payrolls. The remaining amortization period is closed 16 years remaining as of July 1, 2012. The Plan's annual pension cost for the current fiscal year, based on actuarial valuations performed as of July 1, 2012 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 7.00% or 8.00% 8.00% $43,679,004 $43,000,000 7/1/2012 Entry age normal Level % of payroll 8.00% per year 3.00% per year 4.50% 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 appreciation/depreciation for the current year and each of the prior four years. Three-Year Trend Information is as follows: Fiscal Year 2011 $ 2012 2013 Annual Pension Cost (APC) 37,058,594 38,714,436 43,668,870 % of APC Contributed 105.24 100.74 98.47 Net Pension (Asset) Obligation $ (11,153,586) (11,439,420) (10,770,550) 48 Net Pension Asset - The School System's actuarially required contribution, pension cost, and increase in the beginning net pension asset for the fiscal year ended June 30, 2013, were computed as follows: Actuarially required contribution Interest on net pension asset ARC adjustment Annual pension cost Actual contributions made Decrease in net pension asset Net pension asset, June 30, 2012 Net pension asset, June 30, 2013 $43,679,004 (915,151) 905,017 43,668,870 (43,000,000) (668,870) 11,439,420 $10,770,550 Plan Funded Status The School System's funding status, based upon the most recent actuarial valuation, is as follows: Actuarial UAAL Accrued use as a Actuarial Liability Unfunded Percentage of Actuarial Value of (AAL) AAL Funded Covered Covered Valuation Assets Entry Age (UAAL) Ratio Payroll Payroll Date (a) (b) (b-a) (a/b) (c) ((b-a)/c) * 7/1/2012 $101,272,560 $633,671,785 $532,399,225 15.98% $22,914,238 2,323.44% *Not less than zero The schedule of funding progress, presented as RSI following the notes to the financial statements, presents multi-year trend information 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 revision as results are compared to past expectations and new estimates are made about the future. Actuarial calculations reflect a long-term perspective. Calculations are based on the substantive plan in effect as of July 1, 2012. 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 postemployment healthcare plan that covers eligible 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 Employees 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 49 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 not 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 unfunded 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, 2013, were as follows: Certificated Employees July 2012- March 2013 April 2013- June 2013 $912.34 per month $937.34 per month Non-Certificated Employees July 2012- June 2013 $446.20 per month The School System's contribution to the health insurance plans for the fiscal year June 30, 2013, June 30, 2012, and June 30, 2011 were $43,426,063, $41,358,812 and $43,496,218, respectively. These contributions equaled the required contribution/annual OPEB cost. Q. Commitments and Contingencies Construction Commitments The School System has active construction projects as of June 30, 2013. The projects relate to construction, renovation of school buildings, and other projects. At fiscal year-end, the School System's commitments with contractors were $44,680,768. Litigation 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 $ 515,000. 50 Amounts received or receivable 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. R. Pollution Remediation Obligations GASB Statement No. 49, Accounting and Financial Reporting for Pollution Remediation Obligations, establishes accounting and financial reporting criteria for liabilities that address current or potential detrimental effects of existing pollution by participating in pollution remediation activities. When one of five obligating events identified by the GASB occurs, the components of the expected pollution remediation outlays must be estimated, and a determination made whether the outlays should be accrued as a liability or capitalized when goods and services are acquired, as appropriate. Pollution remediation liabilities must be measured based on the pollution remediation outlays expected to be incurred to settle these liabilities. It must be based on "reasonable and supportable" assumptions of future 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 accrual accounting). However, pollution remediation outlays should be capitalized in the government-wide or proprietary fund statements when goods and services are acquired for certain specific purposes; these amounts are recorded as expenditures at the fund level. In government-wide and proprietary fund financial statements, the liability should be recorded at the current value of the costs the government expects to incur to perform the work. This amount should be estimated using the expected cash flow technique, which measures the liability as the sum of probability-weighted amounts in a range of possible estimated amounts the estimated mean or average. As of June 30, 2013, the School System was the responsible party in the remediation of mold removal, asbestos abatement, expired chemical disposal, paint disposal, light bulb disposal, tire disposal, and air quality testing. A site assessment and preliminary evaluation of required remediation indicated that the amount of liability is immaterial as of June 30, 2013 and therefore, not recorded in the governmental activities statement of net position. The potential liability is deemed immaterial at this time to record to the School System's financial statements. APS paid $301,670 for current financial fiscal year remediation activities. S. Changes in Accounting Principle In conjunction with the implementation of Governmental Accounting Standards Board (GASB) Statement No. 65, Items Previously Reported as Assets and Liabilities, the School System is required to change its accounting treatment of debt issuance costs. The new standard requires that debt issuance costs be recognized as an expense in the period incurred rather than deferred and recognized as an expense (amortized) in a systematic and rational manner over the duration of the related debt as was the required treatment in prior reporting periods. 51 Therefore, in conjunction with the implementation of Statement No. 65, the following restatement was required to the beginning net position of the Governmental Activities to properly recognize debt issuance costs as an expense in the periods in which they were incurred: Net position, Governmental Activities, previously reported Recognition of issuance costs incurred in prior periods Beginning net position , Governmental Activities, restated $ 1,384,783,086 (1,381,985) $ 1,383,401,101 T. Subsequent Event On July 1, 2013, the School System entered into a Purchase and Sale agreement with East Lake Foundation, Inc. for an existing school facility known as Charles R. Drew Charter School. The School System acquired the facility for a cash consideration of $10,000,000 which was allocated to the School System by the State of Georgia for the sole purpose of acquiring the facility. The $10,000,000 allocation was fully funded through the issuance of bonds by the State of Georgia. The bonds are not an obligation of the School System and do not constitute a pledge of the faith and credit of the School System. The School System will lease the facility back to East Lake Foundation for a lease term of ninetynine years, at the cost of $1 per year. East Lake Foundation will have an option to acquire the facility from the School System, on or after July 1, 2033, at a purchase price equal to the estimated costs anticipated to be incurred by the School System to hold title to the facility. East Lake Foundation is responsible for all of the costs of operating and maintaining the facility. The State of Georgia commissioned an appraisal of the facility and estimated a value of $19,000,000. In fiscal year 2014, the School System will capitalize the building at the State appraised value, recognizing a gain of $9,000,000 on the purchase of the facility. 52 REQUIRED SUPPLEMENTARY INFORMATION ATLANTA INDEPENDENT SCHOOL SYSTEM Required Supplementary Information June 30, 2013 Actuarial Valuation Date 7/1/2007 7/1/2008 7/1/2009 7/1/2010 7/1/2011 7/1/2012 SCHEDULE OF FUNDING PROGRESS (1) Actuarial Value of Assets $ 133,058,241 150,876,105 112,295,208 114,615,676 113,553,224 101,272,560 (2) Actuarial Accrued Liability (AAL) $ 643,301,615 655,110,071 644,788,188 669,032,859 646,444,083 633,671,785 (3) Funded Ratio (1)/(2) 20.68% 23.03% 17.42% 17.13% 17.57% 15.98% (4) Unfunded / (Surplus) AAL (2)-(1) $ 510,243,374 504,233,966 532,492,980 554,417,183 532,890,859 532,399,225 (5) Annual Covered Payroll $ 29,105,414 28,272,933 29,404,892 26,304,364 24,562,775 22,914,238 (6) UAAL as a Percentage of Covered Payroll (4)/(5) 1753.09% 1783.45% 1810.90% 2107.70% 2169.51% 2323.44% Note: See assumptions used for these schedules disclosed in the notes to the financial statements. This schedule of funding progress reflects the Atlanta Independent School System's participation in the City of Atlanta General Employees' Pension Fund and only shows the School System's actuarial value of assets, actuarial accrued liability and etc. 53 ATLANTA INDEPENDENT SCHOOL SYSTEM General Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 REVENUES Local taxes Investment income Tuition charges Facility rental fees State revenues Federal revenues Charges for services Other TOTAL REVENUES EXPENDITURES Current: Instruction Salary Non-salary Support services Pupil services Salary Non-salary Improvement of instructional services Salary Non-salary Educational media Salary Non-salary General administration Salary Non-salary School administration Salary Non-salary Business administration Salary Non-salary Maintenance and operation of facilities Salary Non-salary Student transportation Salary Non-salary Continued ORIGINAL BUDGET FINAL BUDGET ACTUAL VARIANCE POSITIVE (NEGATIVE) $ 396,919,667 $ 396,293,168 $ 413,467,525 $ 200,000 200,000 104,730 10,000 10,000 2,591 950,000 950,000 1,158,726 151,500,000 151,500,000 143,710,200 2,050,000 2,050,000 1,315,257 1,200,000 1,200,000 3,373,883 5,490,000 5,490,000 22,242,841 $ 558,319,667 $ 557,693,168 $ 585,375,753 $ 17,174,357 (95,270) (7,409) 208,726 (7,789,800) (734,743) 2,173,883 16,752,841 27,682,585 $ 269,459,137 $ 255,190,196 14,268,941 344,878,679 $ 294,376,040 50,502,639 357,322,211 $ 303,240,168 54,082,043 (12,443,532) (8,864,128) (3,579,404) 13,251,357 12,921,182 330,175 12,539,689 10,546,422 1,993,267 8,807,988 8,096,894 711,094 14,033,527 7,678,586 6,354,941 36,097,411 34,830,919 1,266,492 22,038,833 18,101,532 3,937,301 63,391,980 22,933,920 40,458,060 11,957,084 11,290,861 666,223 20,018,481 16,740,462 3,278,019 11,644,295 10,114,768 1,529,527 8,857,930 8,143,194 714,736 11,471,281 7,936,365 3,534,916 39,789,262 39,348,652 440,610 18,016,036 15,777,300 2,238,736 75,047,419 29,392,053 45,655,366 18,131,454 14,080,628 4,050,826 22,019,608 15,565,075 6,454,533 9,408,941 8,315,213 1,093,728 8,824,668 8,129,842 694,826 9,308,666 6,267,723 3,040,943 40,638,070 40,349,867 288,203 12,066,195 10,795,005 1,271,190 72,915,256 26,470,518 46,444,738 20,444,407 15,912,670 4,531,737 (2,001,127) 1,175,387 (3,176,514) 2,235,354 1,799,555 435,799 33,262 13,352 19,910 2,162,615 1,668,642 493,973 (848,808) (1,001,215) 152,407 5,949,841 4,982,295 967,546 2,132,163 2,921,535 (789,372) (2,312,953) (1,832,042) (480,911) 54 ATLANTA INDEPENDENT SCHOOL SYSTEM General Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 EXPENDITURES (CONTINUED) Current (Continued): Support services (continued) Central support Salary Non-salary Other support services Salary Non-salary Nutrition Salary Non-salary Other outlays Salary Non-salary Debt service Principal Interest and fiscal charges TOTAL EXPENDITURES EXCESS (DEFICIENCY) OF REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES) Transfers out Proceeds from sale of capital assets TOTAL OTHER FINANCING SOURCES (USES) ORIGINAL BUDGET FINAL BUDGET ACTUAL VARIANCE POSITIVE (NEGATIVE) 76,711,801 55,739,838 20,971,963 340,048 208,650 131,398 - 43,000,000 - 43,000,000 3,122,353 1,919,667 576,670,875 (18,351,208) - - 17,921,419 10,549,261 7,372,158 345,548 211,150 134,398 302,569 302,569 - 10,281,983 - 10,281,983 3,618,823 1,353,197 581,678,376 (23,985,208) - - 17,392,802 10,550,793 6,842,009 690,246 197,969 492,277 502,711 502,711 - - 3,618,823 1,235,668 576,388,272 8,987,481 (5,925,802) 142,566 (5,783,236) 528,617 (1,532) 530,149 (344,698) 13,181 (357,879) (200,142) (200,142) - 10,281,983 - 10,281,983 117,529 5,290,104 32,972,689 (5,925,802) 142,566 (5,783,236) NET CHANGE IN FUND BALANCES FUND BALANCES - BEGINNING OF FISCAL YEAR FUND BALANCES - END OF FISCAL YEAR $ (18,351,208) 82,017,689 63,666,481 $ (23,985,208) 82,017,689 58,032,481 $ 3,204,245 82,017,689 85,221,934 $ 27,189,453 - 27,189,453 55 OTHER SUPPLEMENTARY INFORMATION Combining and Individual Fund Statements and Schedules: Combining Balance Sheet Nonmajor Governmental Funds Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Non-major Governmental Funds Schedules of Revenues, Expenditures, and Changes in Fund Balances Budget and Actual All Special Revenue Funds: Schedules of Revenues, Expenditures, and Changes in Fund Balances Budget and Actual Nonmajor Special Revenue Funds Combined: Title I Fund Title II Fund Title VI-B Fund Lottery Grants Fund Other Federal Programs Fund Other Special Projects Fund Schedules of Revenues, Expenditures, and Changes in Fund Balances Budget and Actual Capital Projects Fund 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 or committed 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 I Fund was established to account for federal grant funds passed through the Georgia Department of Education to provide remedial education in the areas of reading and mathematics and to provide a special education program for children who are physically handicapped. Title II 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. Lottery Grants Fund was established to account for State of Georgia lottery funds 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 Funds Capital Projects Funds are used to account for financial resources restricted, committed or assigned to expenditures for the acquisition or construction of capital assets. Education Reform Success (ERS) Capital Projects Fund was established by the School System for the purpose of providing financing for some of the School System's buildings and equipment. ERS has issued certificates of participation (COPS) for the acquisition and construction of facilities and equipment. ATLANTA INDEPENDENT SCHOOL SYSTEM Combining Balance Sheet Nonmajor Governmental Funds June 30, 2013 ASSETS Cash and cash equivalents Due from other governments Due from other funds TOTAL ASSETS LIABILITIES AND FUND BALANCES LIABILITIES Accounts payable Due to other governments Due to other funds TOTAL LIABILITIES FUND BALANCES Restricted: Other state and local programs School construction Assigned: Local school programs TOTAL FUND BALANCES TOTAL LIABILITIES AND FUND BALANCES Title I Fund $ - 8,798,127 699,523 $ 9,497,650 Title II Fund $ - 1,016,247 13,429 $ 1,029,676 Special Revenue Funds Title VI-B Fund Lottery Grants Fund $ -$ - 3,435,913 - 71,273 276,130 $ 3,507,186 $ 276,130 Other Federal Programs Fund $ - 3,159,813 305,183 $ 3,464,996 Other Special Projects Fund $ - 1,600,380 6,285,011 $ 7,885,391 Capital Project Fund Education Reform Success, Inc. Fund $ 134,296 - 831,397 $ 965,693 Total Nonmajor Governmental Funds $ 134,296 18,010,480 8,481,946 $ 26,626,722 $ -$ -$ -$ - - 23,413 9,497,650 1,029,676 3,483,773 9,497,650 1,029,676 3,507,186 -$ 1,626 274,504 276,130 13,445 $ - 3,451,551 3,464,996 7,798 $ - 329,320 337,118 -$ 21,243 - 25,039 339,408 18,405,882 339,408 18,452,164 - - - - - - - - - - - - - - - - - 5,183,951 - - - 2,364,322 - 7,548,273 $ 9,497,650 $ 1,029,676 $ 3,507,186 $ 276,130 $ 3,464,996 $ 7,885,391 $ 626,285 - 626,285 5,183,951 626,285 2,364,322 8,174,558 965,693 $ 26,626,722 56 ATLANTA INDEPENDENT SCHOOL SYSTEM Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds For the Fiscal Year Ended June 30, 2013 REVENUES State revenues Federal revenues Other TOTAL REVENUES EXPENDITURES Current: Instruction Support services Pupil services Improvement of instructional services Educational media services Federal grant administration General administration School administration Business administration Maintenance and operation of facilities Student transportation Central support Other support services Nutrition Capital outlays Debt service: Interest and fiscal charges TOTAL EXPENDITURES DEFICIENCY OF REVENUES UNDER EXPENDITURES OTHER FINANCING SOURCES Transfers in TOTAL OTHER FINANCING SOURCES NET CHANGE IN FUND BALANCES FUND BALANCES, BEGINNING OF FISCAL YEAR FUND BALANCES, END OF FISCAL YEAR Title I Fund $ - 32,134,559 - 32,134,559 Title II Fund $ - 4,782,916 - 4,782,916 Special Revenue Funds Title VI-B Fund Lottery Grants Fund $ - 10,400,268 - 10,400,268 $ 2,160,856 - 2,160,856 Other Federal Programs Fund $ - 15,049,417 - 15,049,417 Other Special Projects Fund $ 326,634 483,749 9,351,958 10,162,341 Capital Project Fund Education Reform Success, Inc. Fund $ - 3,659,230 48,100 3,707,330 Total Nonmajor Governmental Funds $ 2,487,490 66,510,139 9,400,058 78,397,687 13,026,685 385,259 13,408,848 1,392,651 1,984,655 7,804 32,605 352,803 23,941 1,519,308 - - 32,134,559 800,666 3,782,670 194 183,109 16,277 - - 4,782,916 6,189,414 1,836,814 601,210 18,507 712,984 - 1,041,339 - - - 10,400,268 2,428,946 5,887 - - 2,434,833 3,840,899 338,339 8,593,400 379,075 767,108 1,207 11,020 122,659 587,948 407,762 - - 15,049,417 1,366,431 437,359 7,122,585 3,467 - 465,564 986 169,348 3,468 121,400 1,755,261 214,045 - - 11,659,914 - 43,083,742 3,659,230 46,742,972 27,653,041 3,003,658 33,508,713 3,661 1,973,342 3,930,311 9,997 212,973 3,468 1,638,201 1,795,479 2,321,301 407,762 43,083,742 3,659,230 123,204,879 - - - (273,977) - (1,497,573) (43,035,642) (44,807,192) - - - 273,977 - 651,825 - 925,802 - - - 273,977 - 651,825 - 925,802 - - - - - (845,748) (43,035,642) (43,881,390) - - - - - 8,394,021 43,661,927 52,055,948 $ -$ -$ -$ -$ - $ 7,548,273 $ 626,285 $ 8,174,558 57 ATLANTA INDEPENDENT SCHOOL SYSTEM All Special Revenue Funds Combined Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 REVENUES State revenues Federal revenues Other TOTAL REVENUES EXPENDITURES Current: Instruction Salary Non-salary Support services Pupil services Salary Non-salary Improvement of instructional services Salary Non-salary Educational media Salary Non-salary Federal grant administration Salary Non-salary General administration Salary Non-salary School administration Salary Non-salary Business administration Salary Non-salary Maintenance and operation of facilities Salary Non-salary Student transportation Salary Non-salary Central support Salary Non-salary Continued ORIGINAL BUDGET FINAL BUDGET ACTUAL VARIANCE POSITIVE (NEGATIVE) $ 3,281,690 $ 3,173,029 $ 111,041,723 133,891,884 10,399,986 14,305,330 124,723,399 151,370,243 2,487,490 $ (685,539) 62,850,909 (71,040,975) 9,351,958 (4,953,372) 74,690,357 (76,679,886) 50,393,910 19,300,595 31,093,315 4,897,496 2,977,737 1,919,759 44,403,350 16,627,732 27,775,618 9,900 9,900 - 7,761,260 5,366,632 2,394,628 5,631,951 685,649 4,946,302 775,166 11,660 763,506 805,962 12,044 793,918 503,652 14,939 488,713 6,059,847 773,457 5,286,390 1,007,240 909,819 97,421 53,529,659 27,703,614 25,826,045 4,364,913 2,109,437 2,255,476 67,200,883 38,326,074 28,874,809 3,767 - 3,767 8,070,296 6,108,877 1,961,419 5,085,893 381,836 4,704,057 574,644 11,667 562,977 779,008 23,699 755,309 498,641 16,790 481,851 5,269,123 830,698 4,438,425 1,060,621 971,764 88,857 27,653,041 16,994,321 10,658,720 3,003,658 1,288,081 1,715,577 33,508,713 24,249,046 9,259,667 3,661 - 3,661 1,973,342 1,755,904 217,438 3,930,311 1,078,283 2,852,028 9,997 - 9,997 212,973 43,625 169,348 3,468 - 3,468 1,638,201 958,101 680,100 1,795,479 511,161 1,284,318 25,876,618 10,709,293 15,167,325 1,361,255 821,356 539,899 33,692,170 14,077,028 19,615,142 106 - 106 6,096,954 4,352,973 1,743,981 1,155,582 (696,447) 1,852,029 564,647 11,667 552,980 566,035 (19,926) 585,961 495,173 16,790 478,383 3,630,922 (127,403) 3,758,325 (734,858) 460,603 (1,195,461) 58 ATLANTA INDEPENDENT SCHOOL SYSTEM All Special Revenue Funds Combined Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 Other support services Salary Non-salary Nutrition Salary Non-salary TOTAL EXPENDITURES DEFICIENCY OF REVENUES UNDER EXPENDITURES OTHER FINANCING SOURCES Transfers in TOTAL OTHER FINANCING SOURCES NET CHANGE IN FUND BALANCES FUND BALANCES - BEGINNING OF FISCAL YEAR FUND BALANCES - END OF FISCAL YEAR ORIGINAL BUDGET 2,096,700 671,307 1,425,393 376,965 - 376,965 124,723,399 - FINAL BUDGET 4,427,520 2,849,545 1,577,975 505,275 - 505,275 151,370,243 - ACTUAL 2,321,301 1,443,020 878,281 407,762 - 407,762 76,461,907 (1,771,550) VARIANCE POSITIVE (NEGATIVE) 2,106,219 1,406,525 699,694 97,513 - 97,513 74,908,336 (1,771,550) - - 925,802 925,802 - - 925,802 925,802 - - (845,748) 8,394,021 8,394,021 8,394,021 $ 8,394,021 $ 8,394,021 $ 7,548,273 $ (845,748) - (845,748) 59 ATLANTA INDEPENDENT SCHOOL SYSTEM Title I Special Revenue Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 REVENUES Federal revenues TOTAL REVENUES EXPENDITURES Current: Instruction Salary Non-salary ORIGINAL BUDGET FINAL BUDGET ACTUAL VARIANCE POSITIVE (NEGATIVE) $ 61,095,168 $ 73,336,387 $ 32,134,559 $ (41,201,828) 61,095,168 73,336,387 32,134,559 (41,201,828) 39,223,730 9,826,109 29,397,621 33,653,247 12,960,495 20,692,752 13,026,685 6,645,710 6,380,975 20,626,562 6,314,785 14,311,777 Support services Pupil services Salary Non-salary 1,428,013 1,166,602 261,411 323,046 275,778 47,268 385,259 372,527 12,732 (62,213) (96,749) 34,536 Improvement of instructional services Salary Non-salary 11,472,229 6,490,809 4,981,420 25,611,330 20,063,953 5,547,377 13,408,848 12,448,706 960,142 12,202,482 7,615,247 4,587,235 Federal grant administration Salary Non-salary 578,023 345,023 233,000 3,857,789 3,141,955 715,834 1,392,651 1,322,622 70,029 2,465,138 1,819,333 645,805 General administration Salary Non-salary 2,623,692 605,654 2,018,038 2,851,605 - 2,851,605 1,984,655 - 1,984,655 866,950 - 866,950 School administration Salary Non-salary 732,392 - 732,392 533,557 - 533,557 7,804 - 7,804 525,753 - 525,753 Business administration Salary Non-salary 12,044 12,044 - - 32,605 (32,605) - 32,605 (32,605) - - - Student transportation Salary Non-salary 3,882,153 - 3,882,153 2,958,132 57,240 2,900,892 352,803 - 352,803 2,605,329 57,240 2,548,089 Central support Salary Non-salary 33,527 33,527 - - 23,941 (23,941) - 23,941 (23,941) - - - Other support services Salary Non-salary 1,109,365 332,521 776,844 3,547,681 2,717,125 830,556 1,519,308 1,353,995 165,313 2,028,373 1,363,130 665,243 TOTAL EXPENDITURES NET CHANGE IN FUND BALANCES FUND BALANCES - BEGINNING OF FISCAL YEAR FUND BALANCES - END OF FISCAL YEAR $ 61,095,168 -$ 73,336,387 -$ 32,134,559 -$ 41,201,828 - 60 ATLANTA INDEPENDENT SCHOOL SYSTEM Title II Special Revenue Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 REVENUES Federal revenues TOTAL REVENUES EXPENDITURES Current: Instruction Salary Non-salary ORIGINAL BUDGET FINAL BUDGET ACTUAL VARIANCE POSITIVE (NEGATIVE) $ 2,698,756 $ 9,285,891 $ 4,782,916 $ (4,502,975) 2,698,756 9,285,891 4,782,916 (4,502,975) 739,883 739,883 - 2,135,288 1,990,429 144,859 800,666 655,877 144,789 1,334,622 1,334,552 70 Support services Pupil services Salary Non-salary - - - - - - - - - - - - Improvement of instructional services Salary Non-salary 1,904,264 705,240 1,199,024 6,756,915 4,166,346 2,590,569 3,782,670 2,270,632 1,512,038 2,974,245 1,895,714 1,078,531 Educational media services Salary Non-salary - 300 194 106 - - - - - 300 194 106 Federal grant administration Salary Non-salary - 366,678 183,109 183,569 - 320,678 161,273 159,405 - 46,000 21,836 24,164 Central support Salary Non-salary 54,609 25,401 29,208 26,710 19,710 7,000 16,277 16,277 - 10,433 3,433 7,000 TOTAL EXPENDITURES NET CHANGE IN FUND BALANCES FUND BALANCES - BEGINNING OF FISCAL YEAR FUND BALANCES - END OF FISCAL YEAR $ 2,698,756 -$ 9,285,891 -$ 4,782,916 -$ 4,502,975 - 61 ATLANTA INDEPENDENT SCHOOL SYSTEM Title VI-B Special Revenue Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 REVENUES Federal revenues TOTAL REVENUES EXPENDITURES Current: Instruction Salary Non-salary ORIGINAL BUDGET FINAL BUDGET ACTUAL VARIANCE POSITIVE (NEGATIVE) $ 9,573,801 $ 12,792,877 $ 10,400,268 $ (2,392,609) 9,573,801 12,792,877 10,400,268 (2,392,609) 4,760,746 4,329,643 431,103 7,265,026 4,328,189 2,936,837 6,189,414 3,172,991 3,016,423 1,075,612 1,155,198 (79,586) Support services Pupil services Salary Non-salary 2,469,788 1,170,755 1,299,033 3,137,570 1,133,390 2,004,180 1,836,814 262,010 1,574,804 1,300,756 871,380 429,376 Improvement of instructional services Salary Non-salary 1,270,184 1,220,484 49,700 1,297,839 1,248,139 49,700 601,210 601,210 - 696,629 646,929 49,700 Federal grant administration Salary Non-salary - - 18,507 (18,507) - - 18,507 (18,507) - - - - General administration Salary Non-salary 75,889 75,889 - 95,247 75,889 19,358 712,984 712,984 - (617,737) (637,095) 19,358 Maintenance and operation of facilities Salary Non-salary 14,000 14,000 - 14,000 14,000 - - 14,000 - 14,000 - - Student transportation Salary Non-salary 983,194 773,457 209,737 983,195 773,458 209,737 1,041,339 958,101 83,238 (58,144) (184,643) 126,499 TOTAL EXPENDITURES NET CHANGE IN FUND BALANCES FUND BALANCES - BEGINNING OF FISCAL YEAR FUND BALANCES - END OF FISCAL YEAR $ 9,573,801 -$ 12,792,877 -$ 10,400,268 -$ 2,392,609 - 62 ATLANTA INDEPENDENT SCHOOL SYSTEM Lottery Grants Special Revenue Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 REVENUES State revenues TOTAL REVENUES EXPENDITURES Current: Instruction Salary Non-salary Support services Pupil services Salary TOTAL EXPENDITURES EXCESS (DEFICIENCY) OF REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES Transfers in TOTAL OTHER FINANCING SOURCES ORIGINAL BUDGET FINAL BUDGET $ 2,186,129 $ 2,218,029 2,186,129 2,218,029 ACTUAL VARIANCE POSITIVE (NEGATIVE) 2,160,856 $ (57,173) 2,160,856 (57,173) 2,186,129 2,129,443 56,686 2,186,129 - - 2,218,029 2,108,955 109,074 2,218,029 - - 2,428,946 2,356,465 72,481 5,887 5,887 2,434,833 (273,977) 273,977 273,977 (210,917) (247,510) 36,593 (5,887) (5,887) (216,804) (273,977) 273,977 273,977 NET CHANGE IN FUND BALANCES - - - - FUND BALANCES - BEGINNING OF FISCAL YEAR - - - - FUND BALANCES - END OF FISCAL YEAR $ -$ -$ -$ - 63 ATLANTA INDEPENDENT SCHOOL SYSTEM Other Federal Programs Special Revenue Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 REVENUES State revenues Federal revenues TOTAL REVENUES EXPENDITURES Current: Instruction Salary Non-salary Support services Pupil services Salary Non-salary Improvement of instructional services Salary Non-salary Educational media Salary Non-salary Federal grant administration Salary Non-salary General administration Salary Non-salary School administration Salary Non-salary Business administration Salary Non-salary Maintenance and operation of facilities Salary Non-salary Student transportation Salary Non-salary Central support Salary Non-salary Other support services Salary Non-salary Nutrition Salary Non-salary TOTAL EXPENDITURES ORIGINAL BUDGET FINAL BUDGET ACTUAL VARIANCE POSITIVE (NEGATIVE) $ 550,000 $ 550,000 $ -$ (550,000) 36,410,610 37,950,729 15,049,417 (22,901,312) 36,960,610 38,500,729 15,049,417 (23,451,312) 1,619,872 1,083,865 536,007 367,233 203,448 163,785 24,489,938 7,188,318 17,301,620 9,900 9,900 - 7,183,237 5,021,609 2,161,628 1,794,497 4,106 1,790,391 9,114 - 9,114 253 - 253 939 939 - 281,827 - 281,827 6,500 6,500 - 820,335 186,287 634,048 376,965 - 376,965 36,960,610 6,075,236 5,166,953 908,283 599,433 470,480 128,953 24,933,476 10,777,062 14,156,414 - 3,845,829 2,646,244 1,199,585 1,500,362 - 1,500,362 8,266 - 8,266 24,271 23,699 572 5,190 2,790 2,400 357,455 - 357,455 - 645,842 37,417 608,425 505,275 - 505,275 38,500,635 3,840,899 3,140,923 699,976 338,339 271,548 66,791 8,593,400 5,879,808 2,713,592 - 379,075 253,502 125,573 767,108 - 767,108 1,207 - 1,207 11,020 11,020 - - 122,659 - 122,659 - 587,948 - 587,948 407,762 - 407,762 15,049,417 2,234,337 2,026,030 208,307 261,094 198,932 62,162 16,340,076 4,897,254 11,442,822 - 3,466,754 2,392,742 1,074,012 733,254 - 733,254 7,059 - 7,059 13,251 12,679 572 5,190 2,790 2,400 234,796 - 234,796 - 57,894 37,417 20,477 97,513 - 97,513 23,451,218 NET CHANGE IN FUND BALANCES FUND BALANCES - BEGINNING OF FISCAL YEAR FUND BALANCES - END OF FISCAL YEAR $ -$ 94 - 94 $ - (94) - - -$ (94) 64 ATLANTA INDEPENDENT SCHOOL SYSTEM Other Special Projects Special Revenue Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 REVENUES State revenues Federal revenues Other TOTAL REVENUES EXPENDITURES Current: Instruction Salary Non-salary Support services Pupil services Salary Non-salary Improvement of instructional services Salary Non-salary Educational media services Salary Non-salary General administration Salary Non-salary School administration Salary Non-salary Business administration Salary Non-salary Maintenance and operation of facilities Salary Non-salary Student transportation Salary Non-salary Central support Salary Non-salary Other support services Salary Non-salary TOTAL EXPENDITURES ORIGINAL BUDGET FINAL BUDGET ACTUAL VARIANCE POSITIVE (NEGATIVE) $ 545,561 $ 405,000 $ 1,263,388 526,000 10,399,986 14,305,330 12,208,935 15,236,330 326,634 $ 483,749 9,351,958 10,162,341 (78,366) (42,251) (4,953,372) (5,073,989) 1,863,550 1,191,652 671,898 632,462 436,932 195,530 5,266,735 1,022,881 4,243,854 - 1,137,873 - 1,137,873 33,660 11,660 22,000 793,665 - 793,665 488,713 - 488,713 912,673 - 912,673 912,604 844,391 68,213 167,000 152,499 14,501 12,208,935 2,182,833 1,148,593 1,034,240 304,864 229,789 75,075 8,601,323 2,070,574 6,530,749 3,467 - 3,467 638,679 305,947 332,732 32,821 11,667 21,154 754,737 - 754,737 479,451 - 479,451 970,341 - 970,341 1,033,911 952,054 81,857 233,997 95,003 138,994 15,236,424 1,366,431 1,022,355 344,076 437,359 376,109 61,250 7,122,585 3,048,690 4,073,895 3,467 - 3,467 465,564 365,299 100,265 986 - 986 169,348 - 169,348 3,468 - 3,468 121,400 - 121,400 1,755,261 470,943 1,284,318 214,045 89,025 125,020 11,659,914 816,402 126,238 690,164 (132,495) (146,320) 13,825 1,478,738 (978,116) 2,456,854 - 173,115 (59,352) 232,467 31,835 11,667 20,168 585,389 - 585,389 475,983 - 475,983 848,941 - 848,941 (721,350) 481,111 (1,202,461) 19,952 5,978 13,974 3,576,510 DEFICIENCY OF REVENUES UNDER EXPENDITURES OTHER FINANCING SOURCES Transfers in - (94) (1,497,573) (1,497,479) - - 651,825 651,825 TOTAL OTHER FINANCING SOURCES - - 651,825 651,825 NET CHANGE IN FUND BALANCES FUND BALANCES - BEGINNING OF FISCAL YEAR FUND BALANCES - END OF FISCAL YEAR - (94) (845,748) 8,394,021 8,394,021 8,394,021 $ 8,394,021 $ 8,393,927 $ 7,548,273 $ (845,654) - (845,654) 65 ATLANTA INDEPENDENT SCHOOL SYSTEM Capital Projects Fund Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended June 30, 2013 REVENUES Sales tax income State revenues Investment income TOTAL REVENUES EXPENDITURES Current: Instruction Salary Non-salary ORIGINAL BUDGET FINAL BUDGET ACTUAL VARIANCE POSITIVE (NEGATIVE) $ 73,280,176 $ - 73,280,176 241,146,743 $ - 241,146,743 85,979,568 135,650 45,266 86,160,484 $ (155,167,175) 135,650 45,266 (154,986,259) 10,099 - 10,099 10,099 - 10,099 - 10,099 - - - 10,099 Support services General administration Salary Non-salary 132,956 - 132,956 2,182,956 - 2,182,956 1,085,826 - 1,085,826 1,097,130 - 1,097,130 Business administration Salary Non-salary 1,074,300 - 1,074,300 2,171,221 146,921 2,024,300 229,868 229,868 - 1,941,353 (82,947) 2,024,300 Maintenance and operation of facilities Salary Non-salary 1,593,478 - 1,593,478 7,945,615 - 7,945,615 4,820,089 - 4,820,089 3,125,526 - 3,125,526 Student transportation Salary Non-salary 1,040,329 - 1,040,329 2,340,329 - 2,340,329 484,556 - 484,556 1,855,773 - 1,855,773 Central support Salary Non-salary 14,636,993 - 14,636,993 14,636,993 - 14,636,993 4,116,069 - 4,116,069 10,520,924 - 10,520,924 Debt service: Principal retirements Interest - 5,920,000 5,920,000 - - 3,064,956 1,790,062 1,274,894 Capital outlays: Facilities acquisition and construction Salary Non-salary 54,792,021 3,752 54,788,269 207,874,574 693,590 207,180,984 74,695,389 490,095 74,205,294 133,179,185 203,495 132,975,690 Other outlays Salary Non-salary TOTAL EXPENDITURES EXCESS (DEFICIENCY) OF REVENUES OVER (UNDER) EXPENDITURES 73,280,176 - 246,146,743 (5,000,000) 93,141,859 (6,981,375) 153,004,884 (1,981,375) OTHER FINANCING SOURCES Transfers in - NET CHANGE IN FUND BALANCES - FUND BALANCES - BEGINNING OF FISCAL YEAR 133,735,552 FUND BALANCES - END OF FISCAL YEAR $ 133,735,552 $ 5,000,000 5,000,000 - (1,981,375) 133,735,552 133,735,552 133,735,552 $ 131,754,177 $ (1,981,375) (1,981,375) 66 ATLANTA INDEPENDENT SCHOOL SYSTEM Statement of Changes in Assets and Liabilities Agency Fund For the Fiscal Year Ended June 30, 2013 ASSETS Cash and cash equivalents LIABILITIES Due to local schools and student groups Balance July 01, 2012 Additions Deductions Balance June 30, 2013 $ 621,016 $ 1,767,433 $ (1,973,514) $ 414,935 $ 621,016 $ 1,767,433 $ (1,973,514) $ 414,935 67 Quality Basic Education Programs Program Expenditures General Fund Quality Basic Education Project (QBE) - Schedule of Allotments and Expenditures by Program Lottery Programs - Schedule of Expenditures by Object Schedule of Approved Local Options Sales Tax Projects Schedule of State Revenues Atlanta Independent School System QUALITY BASIC EDUCATION PROGRAMS - PROGRAM EXPENDITURES For the Fiscal Year Ended June 30, 2013 The Official Code of Georgia Annotated Section 20-2-172 (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 funds designated for direct instructional costs on the direct instructional costs 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 minimum 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. 68 ATLANTA INDEPENDENT SCHOOL SYSTEM BOARD OF EDUCATION GENERAL FUND - QUALITY BASIC EDUCATION PROGRAM(QBE) SCHEDULE OF ALLOTMENTS AND EXPENDITURES - BY PROGRAM FISCAL YEAR ENDED JUNE 30, 2013 DESCRIPTION Direct Instructional Programs 1011 Kindergarten Program 1061 Kindergarten Program-Early Intervention Program 1021 Primary Grades (1-3) Program 1071 Primary Grades-Early Intervention (1-3) Program 1051 Upper Elementary Grades (4-5) Program 1091 Upper Elem Grades-Early Intervention (4-5) Program 1031 Middle Grades (6-8) Program 1081 Middle School (6-8) Program 1041 High School General Education (9-12) Program 3011 Vocational Laboratory (9-12) Program Students with Disabilities 2021 Category I 2031 Category II 2041 Category III 2051 Category IV 2011 Category V 2111 Gifted Student - Category VI 2211 Remedial Education Program 5071 Alternative Education Program 1351 English Speakers of Other Languages (ESOL) TOTAL DIRECT INSTRUCTIONAL PROGRAMS 1310 Media Center Program 1210 Staff and Professional Development ALLOTMENTS FROM GEORGIA DEPARTMENT OF EDUCATION (1) $ 24,760,115 $ 2,145,537 51,645,825 6,558,136 23,454,400 4,787,120 875,612 34,287,811 28,955,282 6,433,361 2,109,804 2,507,782 15,882,919 3,965,921 234,189 9,392,045 3,052,355 2,627,553 2,915,872 226,591,639 6,696,179 1,144,104 SALARIES ELIGIBLE QBE PROGRAM COSTS OPERATIONS TOTAL 20,678,597 $ 1,379,122 61,834,095 17,342,390 19,190,766 1,135,788 45,440 37,401,984 45,642,097 9,796,818 36,940,275 1,132,103 2,195,809 9,830,803 3,263,819 1,495,966 4,577,999 273,883,871 8,140,183 1,954,708 - $ - 1,368,213 - - - - - 516,493 673,945 600,016 - 1,659,083 - - - - 10,674 127,464 760 17,636 20,678,597 1,379,122 63,202,308 17,342,390 19,190,766 1,135,788 45,440 37,918,477 46,316,042 10,396,834 38,599,358 1,132,103 2,195,809 9,841,477 3,391,283 1,496,726 4,595,635 4,974,284 278,858,155 693,505 293,166 8,833,688 2,247,874 TOTAL QBE FORMULA FUNDS 1100 Twenty days additional Instruction 1320 Pupil Transportation 1445 On behalf 1450 Indirect costs - Central Admin. 1455 Indirect costs - School Admin. 1457 Indirect costs - Facilities M&O 1500 Nurses $ 234,431,922 $ 283,978,762 452,333 12,877,697 200,726 - 67,430 $ 297,576,948 $ 5,960,955 4,912,823 $ 10,873,778 $ 289,939,717 452,333 17,790,520 200,726 - 67,430 $ 308,450,726 (1) Comprised of State Funds plus Local Five Mill Share. 69 ATLANTA INDEPENDENT SCHOOL SYSTEM Lottery Programs Schedule of Expenditures by Object For the Fiscal Year Ended June 30, 2013 Salaries Employee benefits Other purchased services Materials and supplies Pre-Kindergarten Program $ 1,803,422 558,931 53,224 19,256 $ 2,434,833 70 PROJECT SPLOST III DeKalb County ATLANTA INDEPENDENT SCHOOL SYSTEM SCHEDULE OF APPROVED LOCAL OPTION SALES TAX PROJECTS FISCAL YEAR ENDED JUNE 30, 2013 ORIGINAL ESTIMATED COST (1) CURRENT ESTIMATED COSTS (2) AMOUNT EXPENDED IN CURRENT FISCAL YEAR (3) AMOUNT EXPENDED IN PRIOR FISCAL YEARS (4) PROJECT STATUS Capital outlay projects consisting of construction, renovations, modifications, additions, and equipment for the following facilities: The Howard School, Lin Elementary School and Whitefoord Elementary School and any future updates: Crim High School, Coan, Springdale Fulton County 20,511,000 24,059,277 2,002,373 22,056,904 Ongoing Capital outlay projects including new school construction, classroom additions, renovations, infrastructure improvements, upgrading security system, technology improvements, land acquisition, site preparation, providing staff development, and instructional SPLOST IV Fulton County 552,357,776 466,741,223 62,129,739 348,111,889 Ongoing Capital outlay projects including new school construction, classroom additions, renovations, infrastructure improvements, upgrading security system, technology improvements, land acquisition, site preparation, providing staff development, and instructional DeKalb County 499,962,831 499,962,831 19,425,135 - Ongoing Capital outlay projects including new school construction, classroom additions, renovations, infrastructure improvements, upgrading security system, technology improvements,relocations, site preparation, providing staff development, and instructional $ 19,500,463 1,092,332,070 $ 19,500,463 1,010,263,794 $ 965,031 84,522,278 $ 370,168,793 Ongoing (1) The School System's original cost estimate as specified in the resolution calling for the imposition of the Local Option Sales Tax. (2) The School System's current estimate of total cost for the projects. Includes all cost from project inception to 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. Amounts expended for these projects may include sales tax proceeds, state, local property taxes, and/or other funds over the life of the projects. (4) The School System's amounts expended in prior fiscal years related to the above projects. (5) The SPLOST III Amount Expended in Prior Fiscal Years (4) balances have been adjusted for reclassication of Springdale and Morningside expenditures from Fulton and DeKalb county. 71 ATLANTA INDEPENDENT SCHOOL SYSTEM SCHEDULE OF STATE REVENUE FISCAL YEAR ENDED JUNE 30, 2013 AGENCY/FUNDING GRANTS Georgia Department of Early Care and Learning Bright from the Start (Lottery) Pre-Kindergarten Program Education, Georgia Department of Quality Basic Education Direct Instructional Cost Kindergarten Program Kindergarten Program - Early Intervention Program Primary Grades (1-3) Program Primary Grades - Early Intervention (1-3) Program Upper Elementary Grades (4-5) Program Upper Elementary Grades - Early Intervention (4-5) Program Middle Grades (6-8) Program Middle School (6-8) Program High School General Education (9-12) Program Vocational Laboratory (9-12) Program Students with Disabilities - All Categories Gifted Student - Category VI Remedial Education Program Alternative Education Program English Speakers of Other Languages (ESOL) Media Center Program 20 Days Additional Instruction Staff and Professional Development Indirect Cost Central Administration School Administration Facility Maintenance and Operations Categorical Grants Pupil Transportation Regular Bus Replacement Nursing Services Austerity Reduction Other State Programs Charter Schools - Facilities CTAE - Apprenticeship CTAE - CTE Extended Day CTAE - Supervision Math and Science Supplement Preschool Handicapped State Grant Residential Treatment Centers Grant Teacher's Retirement Technical and Adult Education, Georgia Department of Adult Education Georgia State Financing and Investment Commission Young Middle School Construction Project GOVERNMENTAL FUND TYPES GENERAL FUND CAPITAL PROJECTS FUND NONMAJOR GOVERNMENTAL FUNDS $ -$ - $ 2,160,856 14,125,045 1,676,485 28,841,442 5,884,390 12,617,222 3,824,292 172,858 19,738,762 16,551,383 3,526,278 15,404,612 5,747,642 1,990,519 1,492,521 1,744,205 3,879,219 1,181,228 672,865 3,077,402 8,853,397 8,478,628 3,041,064 350,986 867,129 (22,578,518) 603,225 37,641 122,783 56,244 667,907 483,985 376,633 200,726 - - - - - - - - 135,650 - - - - - 326,634 - TOTAL $ 2,160,856 14,125,045 1,676,485 28,841,442 5,884,390 12,617,222 3,824,292 172,858 19,738,762 16,551,383 3,526,278 15,404,612 5,747,642 1,990,519 1,492,521 1,744,205 3,879,219 1,181,228 672,865 - 3,077,402 8,853,397 8,478,628 3,041,064 350,986 867,129 (22,578,518) 603,225 37,641 122,783 56,244 667,907 483,985 376,633 200,726 326,634 135,650 $ 143,710,200 $ 135,650 $ 2,487,490 $ 146,333,340 72 STATISTICAL SECTION (Unaudited) Atlanta Independent School System Introduction to the Statistical Section (Unaudited) This part of Atlanta Independent School Systems Comprehensive Annual Financial Report presents detailed information as a context for understanding this fiscal year's financial statements, note disclosures, and supplementary information. This information is unaudited. Contents Schedule Financial Trends 1 - 6 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. Operating Information 7 - 13 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. Demographic and Economic Information 14 - 22 These tables present demographic and economic information 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. Data Source: Unless otherwise noted, the information in these tables is derived from the Comprehensive Annual Financial Report for the applicable fiscal year. ATLANTA INDEPENDENT SCHOOL SYSTEM NET POSITION BY COMPONENT LAST TEN FISCAL YEARS Schedule 1 Fiscal Year Ended June 30, Governmental Activities Net investment in capital assets Restricted Unrestricted Total Governmental Activities Net Position 2004 2005 2006 2007 2008 2009 2010 2011 Restated 2012 2013 $ 733,997,697 - 95,404,253 829,401,950 $ 803,563,172 3,988,606 115,840,477 923,392,255 $ 831,829,656 26,478,370 125,881,509 984,189,535 $ 893,683,701 $ 854,305,957 106,980,587 182,517,605 157,963,991 191,270,394 1,158,628,279 1,228,093,956 $ 959,621,519 152,371,189 168,743,024 1,280,735,732 $ 1,056,744,474 111,943,417 128,194,970 1,296,882,861 $ 1,104,601,221 112,855,070 147,834,977 1,365,291,268 $ 1,171,493,160 116,028,486 95,879,455 1,383,401,101 $ 1,187,165,191 119,946,096 106,598,064 1,413,709,351 Business-Type Activities Net investment in capital assets Unrestricted (deficit) Total Business-Type Activities Net Position 3,897,068 (22,325,064) (18,427,996) 5,055,963 (25,805,372) (20,749,409) 5,776,388 (26,121,644) (20,345,256) 8,504,052 (9,964,379) (1,460,327) 484,935 484,935 1,972,799 1,972,799 2,038,487 2,038,487 2,183,644 2,183,644 4,893,181 4,893,181 141,550 5,481,550 5,623,100 Primary Government Activities Net investment in capital assets Restricted Unrestricted Total Primary Government Activities Net Position 737,894,765 - 73,079,189 $ 810,973,954 808,619,135 3,988,606 90,035,105 $ 902,642,846 837,606,044 26,478,370 99,759,865 $ 963,844,279 902,187,753 854,305,957 106,980,587 182,517,605 147,999,612 191,755,329 $ 1,157,167,952 $ 1,228,578,891 959,621,519 152,371,189 170,715,823 $ 1,282,708,531 1,056,744,474 111,943,417 130,233,457 $ 1,298,921,348 1,104,601,221 112,855,070 150,018,621 $ 1,367,474,912 1,171,493,160 116,028,486 100,772,636 $ 1,388,294,282 1,187,306,741 119,946,096 112,079,614 $ 1,419,332,451 Source: Atlanta Independent School System Financial Reports for previous years and fiscal year ended June 30, 2013. 73 Fiscal Year Ended June 30, Expenses Governmental Activities Instruction Pupil Services Improvement of instructional services Educational media Federal grant administration General administration School administration Business administration Maintenance and operation of facilities Student transportation Central support Community services Other support services Nutrition Interest and fiscal charges Depreciation Total Governmental Activities Expenses Business-Type Activities Food services Total Business-Type Activities Expenses Total Primary Government Activities Expenses Program Revenues Governmental Activities Charges for Services Instruction Pupil services School administration Maintenance and operation of facilities Other support services Nutrition Operating Grants and Contributions Instruction Pupil services Improvement of instructional services Educational media Federal grant administration General administration School administration Business administration Maintenance and operation of facilities Student transportation Central support Community Services Other support services Nutrition Interest and fiscal charges Capital Grants and Contributions Instruction Improvement of instructional services Maintenance and operation of facilities Student transportation Total Governmental Activities Program Revenues Business-Type Activities Charges for Services Food Services Operating Grants and Contributions Food Services Total Business-Type Activities Program Revenues Total Primary Government Activities Program Revenues ATLANTA INDEPENDENT SCHOOL SYSTEM CHANGE IN NET POSITION LAST TEN FISCAL YEARS Schedule 2 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 $ 424,091,453 $ 435,352,357 $ 21,890,649 24,009,140 21,135,004 20,011,373 6,746,870 7,087,158 - - 21,539,082 18,908,200 24,230,800 23,247,406 5,482,136 6,685,755 61,354,665 48,321,284 15,189,582 14,678,214 29,129,882 26,204,018 - - - 423,301 - - 690,836 538,613 204,969 - 631,685,928 625,466,819 393,121,077 $ 29,201,941 31,910,382 11,326,263 22,244,328 36,313,409 12,973,297 60,098,358 21,658,991 26,764,937 837,701 1,855,674 648,306,358 384,275,604 $ 20,424,786 27,779,791 8,112,792 22,613,568 25,103,296 14,960,540 57,871,414 19,865,342 25,086,693 (13,721) 2,267,033 1,031,588 - 609,378,726 442,325,531 $ 36,915,697 42,180,829 11,637,527 18,659,059 34,558,215 11,483,553 91,600,184 42,709,556 32,899,945 - 9,330,309 - 1,788,213 - 776,088,617 427,131,947 $ 36,130,943 38,598,585 9,220,728 15,698,105 26,425,185 24,150,131 88,484,674 53,662,233 38,798,862 3,707,098 2,295,941 - 764,304,432 438,036,127 $ 37,303,898 40,427,290 8,394,083 14,110,681 28,239,428 15,327,591 90,747,017 39,593,169 48,566,805 3,350,291 2,022,585 - 766,118,965 377,491,180 $ 39,024,421 50,496,694 9,616,559 14,514,905 33,287,126 17,889,836 96,333,469 28,898,209 36,729,914 4,382,181 15,657 2,258,183 710,938,335 405,995,101 $ 29,543,231 38,215,985 8,958,197 1,118,206 17,882,230 30,826,584 22,610,577 97,084,662 29,770,071 28,379,529 13,035,152 358,681 6,418,786 730,196,992 426,037,447 25,105,338 42,917,654 8,869,786 1,973,342 14,324,803 40,648,067 15,157,828 80,783,550 24,892,766 23,304,350 3,011,547 910,473 5,851,816 - 713,788,767 26,552,371 26,552,371 25,772,181 25,772,181 $ 658,238,299 $ 651,239,000 $ 21,711,551 21,711,551 670,017,909 $ 19,204,656 19,204,656 628,583,382 $ 30,519,130 30,519,130 806,607,747 $ 21,752,821 21,752,821 786,057,253 $ 23,222,029 23,222,029 789,340,994 $ 23,800,532 23,800,532 734,738,867 $ 22,705,598 22,705,598 752,902,590 $ 23,680,487 23,680,487 737,469,254 $ -$ -$ - - - - - - - - - - 187,402,434 6,558,788 17,556,463 30,954 3,756,784 381,845 58,967 379,673 754,227 2,524,240 - 170,977,158 8,414,003 16,447,379 182,646 - 4,151,612 238,704 366,225 27,511 1,409,015 1,105,539 1,444,714 - 2,717,420 - 222,121,795 2,230,799 - 206,995,305 -$ 2,097,124 - 176,215,716 7,400,136 11,712,590 1,491,330 4,516,383 355,600 1,115,379 261,388 1,960,211 104,874 - 677,385 - 8,927 - 1,640,644 209,611,500 1,004,517 $ - 1,067,404 - 156,075,020 14,951,701 16,073,230 2,424,655 3,336,077 6,065,020 1,102,416 8,740,838 5,206,251 984,451 65,551 7,365,780 - 1,191,630 225,654,541 114,350 $ - 3,749,416 168,958,774 18,133,132 16,110,597 3,745,884 3,104,288 3,498,951 9,106,449 9,262,487 5,337,639 660,429 226,806 1,307,102 - 2,207,605 653,047 246,176,956 140,047 $ - 1,246,236 - 767,347 108,327,712 20,282,835 20,193,588 2,899,356 5,788,541 5,874,998 3,933,403 17,293,612 8,537,786 7,680,398 2,811,038 12,691 - 205,789,588 90,084 $ - 995,042 - 754,773 110,873,809 14,470,057 27,647,132 1,404,768 3,705,087 6,841,227 2,925,304 15,521,798 8,286,759 9,984,164 2,116,177 - 205,616,181 31,492 $ - 783,989 670,918 - 111,426,958 18,641,247 33,328,056 2,000,787 5,053,926 7,958,215 4,077,543 20,416,518 6,735,023 9,260,421 2,845,306 14,696 - 25,367,686 - 248,612,781 3,490 $ 996,731 724,400 - 110,219,318 11,780,166 30,489,786 1,118,206 7,689,306 7,325,735 4,105,440 22,290,143 8,218,788 7,961,419 4,210,388 358,681 2,520,803 8,803,308 - 228,816,108 2,591 3,373,883 1,158,726 113,724,544 8,489,114 34,826,333 2,223,907 1,973,342 6,213,208 10,237,170 3,227,896 18,353,454 6,767,808 5,947,248 2,467,522 407,762 3,659,230 3,904,228 135,500 135,650 227,229,116 1,966,090 3,566,337 20,250,537 18,088,139 22,216,627 21,654,476 $ 244,338,422 $ 228,649,781 $ 2,580,828 18,265,689 20,846,517 230,458,017 $ 2,534,746 19,068,852 21,603,598 247,258,139 $ 2,187,375 20,877,018 23,064,393 269,241,349 $ 2,291,777 20,948,908 23,240,685 229,030,273 $ 1,836,912 21,442,603 23,279,515 228,895,696 $ 1,695,061 22,233,560 23,928,621 272,541,402 $ 1,638,841 23,774,887 25,413,728 254,229,836 $ 1,279,087 23,131,319 24,410,406 251,639,522 74 ATLANTA INDEPENDENT SCHOOL SYSTEM CHANGE IN NET POSITION LAST TEN FISCAL YEARS Schedule 2 Fiscal Year Ended June 30, Net (Expense)/Revenue Governmental Activities Instruction Pupil Services Improvement of instructional services Educational media General administration School administration Business administration Maintenance and operation of facilities Student transportation Central support Community Services Other support services Nutrition Interest and fiscal charges Depreciation Total Governmental Activities Net (Expenses)/Revenues 2004 2005 $ (233,971,599) $ (262,144,400) $ (15,331,861) (15,595,137) (3,578,541) (3,563,994) (6,715,916) (6,904,512) (17,782,298) (14,756,588) (23,848,955) (23,008,702) (5,482,136) (6,319,530) (61,295,698) (48,293,773) (14,809,909) (13,269,199) (28,375,655) (25,098,479) - - 2,524,240 1,021,413 - - (690,836) (538,613) (204,969) - (409,564,133) (418,471,514) Business-Type Activities Food Services Total Business-Type Activities Net (Expenses)/Revenues (4,335,744) (4,335,744) (4,117,705) (4,117,705) Total Primary Government Activities Net Expense $ (413,899,877) $ (422,589,219) $ General Revenues and Other Charges in Net Position Governmental Activities Taxes Property Taxes levied for general purposes Property Taxes levied for debt Services Special Local Option Sales Tax & Other Taxes Grants and Contributions not restricted to specific programs Investment Earnings Other Gain on sale of capital assets Transfers Extraordinary items Total Governmental Activities $ 373,487,358 $ 377,215,701 $ - - 85,604,946 91,202,366 - - 1,995,307 4,658,043 3,786,290 5,900,535 - - (1,592,485) (1,796,292) - - 463,281,416 477,180,353 Business-Type Activities Investment Earnings Transfers Other Total Business-Type Activities Total Primary Government Activities - - 1,592,485 1,796,292 - - 1,592,485 1,796,292 $ 464,873,901 $ 478,976,645 $ Change in Net Position Governmental Activities Business-Type Activities Total Primary Government $ 53,717,283 $ 58,708,839 $ (2,743,259) (2,321,413) $ 50,974,024 $ 56,387,426 $ Source: Notes: Atlanta Independent School System Financial Reports for previous years and fiscal year ended June 30, 2013 Restatement in year 2008 due to prior period adjustments for change in accounting principle and estimates. In fiscal year 2008, change in pension expense allocation. In fiscal year 2007, change in allocation of capital assets. Changes in Instruction support 2007 to 2008 due to proper allocation of salary and benefits in 2008. GASB 34 implemented in 2002. In fiscal year 2010, sales tax decreased due to sales tax refund/repayment. Decrease in Sales Tax revenue in fiscal year 2011 due in part to the economic downturn. Decrease in Sales Tax revenue in fiscal year 2012 due in part to the economic downturn. 2006 2007 (216,896,434) $ (21,801,805) (20,197,792) (9,834,933) (17,727,945) (33,860,685) (11,857,918) (59,836,970) (18,058,136) (26,660,063) (106,503) (1,855,674) (438,694,858) (227,196,067) $ (5,473,085) (11,706,561) (5,688,137) (19,277,491) (19,038,276) (13,858,124) (48,063,172) (13,467,461) (24,102,242) 79,272 5,098,747 (1,031,588) - (383,724,185) (865,034) (865,034) (439,559,892) $ 2,398,942 2,398,942 (381,325,243) $ 361,839,014 $ - 117,933,347 9,411,373 7,319,327 6,316,574 2,505,987 (1,036,966) - 504,288,656 436,902,846 $ 1,036,250 121,568,835 - 13,315,151 15,129,339 3,129,377 (16,416,074) (1,981,811) 572,683,913 59,711 1,036,966 1,096,677 505,385,333 $ (9,535) 16,416,074 79,445 16,485,984 589,169,897 $ 65,593,798 $ 231,643 65,825,441 $ 188,959,728 $ 18,884,926 207,844,654 $ 75 2008 2009 2010 2011 2012 2013 (273,252,407) $ (18,782,565) (26,070,232) (7,891,643) (15,554,771) (31,059,264) (2,377,104) (80,130,092) (36,718,870) (32,239,516) (8,023,207) 226,806 3,749,416 (1,788,213) (529,911,661) (318,664,187) $ (15,848,107) (18,404,997) (6,321,372) (9,909,564) (20,550,187) (20,216,730) (69,944,826) (45,124,446) (31,118,464) 2,811,038 (3,707,098) 780,038 (2,295,941) (558,514,843) (327,072,234) $ (22,833,841) (12,780,158) (6,989,315) (10,405,594) (21,398,201) (12,402,287) (74,230,177) (31,306,410) (38,582,641) 2,116,177 (3,350,291) 754,773 (2,022,585) (560,502,784) (240,665,044) $ (20,383,174) (17,168,638) (7,615,772) (9,460,979) (25,328,911) (13,812,293) (75,132,962) (22,163,186) (27,469,493) (865,957) (961) (2,258,183) (462,325,554) (286,968,985) $ (17,763,065) (7,726,199) (8,958,197) (10,192,924) (23,500,849) (18,505,137) (73,797,788) (21,551,283) (20,418,110) (8,100,364) (3,897,983) (501,380,884) (308,406,084) (13,242,341) (7,955,821) (6,645,879) (8,111,595) (30,410,897) (11,929,932) (61,135,720) (18,124,958) (17,357,102) (544,025) (502,711) (2,192,586) (486,559,651) (7,454,737) (7,454,737) (537,366,398) $ 1,487,864 1,487,864 (557,026,979) $ 57,486 57,486 (560,445,298) $ 128,089 128,089 (462,197,465) $ 2,708,130 2,708,130 (498,672,754) $ 729,919 729,919 (485,829,732) 470,036,120 $ 1,153,847 115,735,907 1,347,241 13,648,335 6,855,522 (9,400,000) - 599,376,972 479,629,504 $ 1,262,460 108,957,224 4,328,538 6,419,960 15,296,550 528,432 - 616,422,668 498,921,379 $ 1,271,739 63,438,076 1,306,947 230,484 10,583,834 897,453 - 576,649,912 469,310,346 $ 1,174,306 52,901,075 1,310,441 124,833 5,298,494 614,466 - 530,733,961 414,313,637 $ 1,111,471 93,699,732 11,613,166 134,088 - 520,872,094 416,364,236 1,910,601 85,376,919 20,946,374 198,096 (7,928,325) 516,867,901 9,400,000 9,400,000 608,776,972 $ 616,422,668 $ 8,202 - 8,202 576,658,114 $ 17,068 - 17,068 530,751,029 $ 1,407 - 1,407 520,873,501 $ 516,867,901 69,465,311 $ 1,945,263 71,410,574 $ 57,907,825 $ 1,487,864 59,395,689 $ 16,147,128 $ 65,688 16,212,816 $ 68,408,407 $ 145,157 68,553,564 $ 19,491,818 $ 2,709,537 22,201,355 $ 30,308,250 729,919 31,038,169 ATLANTA INDEPENDENT SCHOOL SYSTEM GOVERNMENTAL FUND BALANCES LAST TEN FISCAL YEARS Schedule 3 Fiscal Year Ended June 30, Pre-GASB 54 General Fund Reserved Unreserved Total General Fund All Other Governmental Funds Reserved Unreserved, reported in: Capital Project Funds Special Revenue Funds Total All Other Governmental Funds Total 2004 2005 2006 2007 2008 2009 2010 $ 11,159,630 $ 7,325,684 $ 13,692,102 $ 21,785,030 $ 20,198,038 $ 72,359,684 $ 33,799,205 37,292,448 68,098,575 73,372,473 91,809,975 131,566,427 85,541,272 75,928,012 48,452,078 75,424,259 87,064,575 113,595,005 151,764,465 157,900,956 109,727,217 70,077 70,078 22,216,154 103,139,827 168,623,662 149,939,551 136,951,993 32,778,625 17,571,631 50,420,333 30,060,165 11,868,263 41,998,506 39,512,697 12,177,524 73,906,375 34,183,429 12,652,472 149,975,728 23,702,646 14,193,822 206,520,130 11,995,289 161,934,840 11,767,769 148,719,762 $ 98,872,411 $ 117,422,765 $ 160,970,950 $ 263,570,733 $ 358,284,595 $ 319,835,796 $ 258,446,979 GASB 54 General Fund Nonspendable Restricted Committed Assigned Unassigned Total General Fund 2011 2012 2013 $ 456,347 $ 1,023,447 $ 2,396,733 1,104,717 299,867 395,553 16,995,134 1,589,097 1,139,666 16,000,000 28,351,208 25,300,000 46,711,357 50,754,070 55,989,982 81,267,555 82,017,689 85,221,934 All Other Governmental Funds Nonspendable Restricted Assigned Total All Other Governmental Funds 111,750,353 31,109,255 142,859,608 162,298,650 23,492,850 185,791,500 2,660,568 119,684,839 17,583,328 139,928,735 Total $ 224,127,163 $ 267,809,189 $ 225,150,669 Source: Note: Atlanta Independent School System Financial Report for previous years and fiscal year ended June 30, 2013. GASB Statement number 54 established a hierarchy of fund balance classifications based primarily on the extent to which governments are bound by constraints placed on resources. The effective date for implementation of GASB 54 was for periods beginning after June 15, 2010. Presentation for years 2004-2010 is pre GASB 54. Fiscal Year 2011 is when the standard was implemented. 76 ATLANTA INDEPENDENT SCHOOL SYSTEM CHANGES IN GOVERNMENTAL FUND BALANCES LAST TEN FISCAL YEARS Schedule 4 Fiscal Year Ended June 30, Revenues Local taxes Sales taxes income State revenues Federal revenues Investment income Facility rental fees Tuition charges Charges for services Other Total Revenues Expenditures Current Expenditures Instruction Support Services: Pupil Services Improvement of instructional services Educational media Federal grant administration General administration School administration Business administration Maintenance and operation of facilities Student transportation Central Support Other support services Nutrition Other Other Operations of Non-Instructional Services Capital Outlays Debt Service: Principal Interest and fiscal cgharges Total Expenditures 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 $ 365,523,133 $ 370,256,829 $ 369,492,043 $ 415,687,665 $ 471,313,094 $ 507,895,487 ########### $ 445,986,671 $ 445,177,849 $ 413,467,525 85,604,946 91,202,366 115,953,787 122,980,958 106,562,802 103,765,261 95,443,229 57,678,243 93,097,083 85,979,568 152,497,189 137,310,665 141,640,201 151,924,389 163,747,188 129,106,908 110,942,787 132,033,597 142,661,322 146,333,340 63,594,376 65,118,135 66,535,863 71,658,231 71,651,548 70,336,278 82,463,268 84,046,858 75,794,627 67,825,396 1,995,307 4,658,043 7,319,327 13,315,151 13,648,335 6,419,960 410,218 282,686 134,088 198,096 709,320 876,965 949,298 - 1,604,301 1,246,236 995,042 783,989 996,731 1,158,726 45,748 11,707 243,698 - 114,350 140,047 90,084 31,492 3,490 2,591 - - 904,128 2,071,921 3,749,416 767,348 754,773 670,918 724,400 3,373,883 9,545,822 9,578,369 15,066,259 15,884,882 13,512,915 23,817,861 22,081,274 13,897,009 20,717,752 31,594,799 679,515,841 679,013,079 718,104,604 793,523,197 845,903,950 843,495,386 807,006,466 735,411,463 779,307,342 749,933,924 405,869,137 21,853,555 21,181,874 6,738,907 - 13,504,910 24,230,800 5,482,136 61,539,367 13,022,959 30,515,657 526,684 - 169,069,406 6,066,632 690,836 780,292,860 395,383,620 23,972,046 20,071,788 7,080,214 - 9,832,227 23,525,692 6,795,841 48,442,054 12,815,478 26,393,782 220,262 - 107,635,321 4,386,236 538,613 687,093,174 358,003,139 28,296,328 31,811,061 11,128,439 15,066,526 35,579,029 12,959,536 59,941,395 19,331,040 26,567,407 796,364 48,270 78,371,573 2,700,668 403,266 681,004,041 405,189,908 23,654,225 31,501,828 9,119,001 - 15,833,120 28,207,534 15,632,317 60,202,421 17,344,114 28,680,154 2,386,576 56,735,237 3,840,761 - 698,327,196 373,703,960 33,795,599 38,823,821 10,507,784 17,134,640 32,147,765 23,625,597 84,456,521 37,822,559 29,586,277 983,284 49,014 - 7,974,781 67,911,787 2,387,590 1,788,213 762,699,192 394,246,196 403,804,829 35,859,316 38,318,666 9,081,715 - 15,572,414 26,227,397 17,182,008 89,297,173 51,723,141 38,517,074 3,676,062 12,500 - 151,389,516 36,234,070 39,447,284 8,145,710 - 13,763,790 27,509,235 15,934,176 90,301,296 36,256,980 47,399,446 3,274,650 139,770,104 6,800,416 2,295,941 880,199,535 2,022,585 5,755,506 869,619,661 373,889,853 38,474,947 49,820,431 9,446,870 - 14,320,518 32,841,337 16,837,414 96,145,841 26,016,620 36,238,019 4,323,494 15,657 - 170,374,153 5,934,366 1,803,937 877,950,004 369,977,089 29,461,159 38,215,985 8,916,740 1,118,206 17,882,230 30,826,584 16,653,106 98,718,040 27,596,737 28,294,967 13,035,152 358,681 - 46,053,815 7,904,791 5,331,323 740,344,605 384,975,252 25,023,266 42,917,654 8,828,329 1,973,342 14,324,803 40,648,067 12,509,036 77,738,813 22,567,164 23,304,350 3,011,547 910,473 - 117,779,131 9,538,823 6,684,960 792,735,010 77 ATLANTA INDEPENDENT SCHOOL SYSTEM CHANGES IN GOVERNMENTAL FUND BALANCES LAST TEN FISCAL YEARS Schedule 4 Fiscal Year Ended June 30, Excess / (Deficiency) of Revenues over (under) Expenditures Other Financing Sources (Uses) Proceeds from Bonds Premium on bonds Proceeds from Capital Leases Proceeds from sale of capital assets Proceeds from issuance of note payables Transfers in Transfers out Total Other Financing Sources/(Uses) Extraordinary Items Net Change in Fund Balances Fund Balance at Beginning of Fiscal Year Prior Period Corrections Change in accounting practice FUND BALANCE AT END OF FISCAL YEAR 2004 (100,777,019) 2005 (8,080,095) 2006 37,100,563 2007 95,196,001 2008 83,204,756 2009 (36,704,149) 2010 (62,613,195) 2011 (142,538,541) 2012 38,962,737 2013 (42,801,086) 13,270,248 - 2,952,010 - 18,158,072 (19,750,557) 14,629,773 11,875,815 - 18,128,500 (19,924,792) 10,079,523 3,907,884 - 3,131,798 40,000 19,874,172 (19,874,172) 7,079,682 3,921,678 - 2,638,066 3,169,238 10,115,000 27,635,695 (44,051,769) 3,427,908 20,000,000 909,104 25,307,215 (34,707,215) 11,509,104 932,980 34,055,410 (34,055,410) 932,980 1,224,378 44,664,147 (44,664,147) 1,224,378 104,415,000 3,097,709 706,016 - 10,974,126 (10,974,126) 108,218,725 4,467,505 251,784 600,090 (600,090) 4,719,289 142,566 5,925,802 (5,925,802) 142,566 - - - (1,981,811) - - - - - - (86,147,246) 1,999,428 44,180,245 96,642,098 94,713,862 (35,771,169) (61,388,817) (34,319,816) 43,682,026 (42,658,520) 185,019,657 115,423,338 116,292,413 166,928,634 263,570,733 355,606,965 323,846,887 258,446,979 224,127,163 267,809,189 - - 498,296 - - - - - - - - - - - - - (4,011,091) - - - $ 98,872,411 $ 117,422,766 $ 160,970,954 $ 263,570,733 $ 358,284,596 $ 319,835,796 $ 258,446,979 $ 224,127,163 $ 267,809,189 $ 225,150,669 FUND BALANCE AT END OF FISCAL YEAR Debt service as a percentage of noncapital expenditures 98,872,411 0.87% 117,422,766 0.72% 160,970,954 0.46% 263,570,733 0.60% 358,284,596 0.60% 319,835,796 1.26% 258,446,979 1.08% 224,127,163 1.30% 267,809,189 1.94% 225,150,669 2.46% Source: Atlanta Independent School System Financial Reports for previous years and fiscal year ended June 30, 2013. Notes: Extraordinary item in 2007 closing of two charter schools. Changes in Instruction support 2007 to 2008 due to proper allocation of salary and benefits in 2008. In fiscal year 2008 change in pension expenditure. Large fluctuations in expenditures due to reclasses within functions in FY2009-2011 . Decrease in Sales tax income between FY10 and FY11 was due in part to the adjustment for overpayement of SPLOST proceeds. 78 ATLANTA INDEPENDENT SCHOOL SYSTEM GENERAL FUND EXPENDITURES BY FUNCTION LAST TEN FISCAL YEARS Schedule 5 Fiscal Year 2004 Instruction 1 359,444,397 2005 360,922,790 2006 328,733,992 2007 371,030,700 2008 346,276,544 2009 385,984,855 2010 2011 4 397,022,707 4 370,061,246 2012 354,658,932 2013 375,555,820 Pupil Services 15,259,936 15,635,773 20,886,301 10,491,218 16,742,092 20,045,172 19,336,072 24,014,862 23,126,330 22,019,608 General and Admin. Services 52,257,050 23,265,642 42,964,459 34,463,418 41,041,883 36,636,052 36,787,333 42,918,150 43,942,259 49,946,736 Business Services 2 68,966,619 65,285,140 85,768,267 87,064,138 140,274,918 133,410,584 136,817,366 133,081,824 136,262,413 105,425,858 Capital Outlay - 3,029,090 - 2,638,066 8,257,558 - Other 3 37,341,209 34,293,523 31,105,339 31,071,989 39,184,963 42,590,714 40,770,273 39,937,929 46,644,887 23,440,250 Total total current expenditures % of change from prior year total capital outlay total expenditures % of change from % of change from prior year prior year 533,269,211 1.32% 0.00% 3.11% 502,431,958 -6.21% 100.00% -5.78% 509,458,358 2.85% 0.00% 1.40% 536,759,529 5.16% 100.00% 5.36% 591,777,958 8.21% 68.05% 10.25% 618,667,377 5.83% 0.00% 4.54% 630,733,751 2.41% 0.00% 1.95% 610,014,011 -3.37% 0.00% -3.29% 604,634,821 -2.12% 0.00% -0.88% 576,388,272 -0.90% 0.00% -4.67% Source: Notes: Atlanta Independent School System Financial Reports for previous years and fiscal year ended June 30, 2013. 1 Instruction includes Improvement of Instructional Services and Educational Media. 2 Business Services includes Business Administration , Maintenance and Facilites, and Student Transportation. 3 Other includes Central Support, Community Services, Other Operations, Principal and Interest. 4 Expenditures for Charter Schools were reclassed to Instruction in fiscal year 2010 and 2011. 79 Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: ATLANTA INDEPENDENT SCHOOL SYSTEM GENERAL FUND REVENUES BY SOURCE LAST TEN FISCAL YEARS Schedule 6 Taxes 362,726,900 370,256,829 384,221,179 430,844,808 480,152,929 514,075,346 493,825,791 445,986,671 445,177,849 413,467,525 State Grants 141,848,193 124,113,881 133,943,879 145,105,716 154,892,058 122,514,004 107,237,545 127,235,844 140,134,932 143,710,200 Federal Grants 1,153,791 1,326,039 3,870,753 1,112,951 1,347,241 4,328,538 15,452,007 10,747,543 1,409,596 1,315,257 Other 8,086,373 13,084,964 15,437,607 19,069,158 17,353,301 16,548,410 9,262,323 7,841,900 14,525,430 26,882,771 Total 513,815,257 508,781,713 537,473,418 596,132,633 653,745,529 657,466,298 625,777,666 591,811,958 601,247,807 585,375,753 Atlanta Independent School System Financial Reports for previous years and fiscal year ended June 30, 2013. Local 71% 73% 71% 72% 73% 78% 79% 75% 74% 71% % of total State Federal 27.61% 0.22% 24.39% 0.26% 24.92% 0.72% 24.34% 0.19% 23.69% 0.21% 18.63% 0.66% 17.14% 2.47% 21.50% 1.82% 23.31% 0.23% 24.55% 0.22% Other 1.57% 2.57% 2.87% 3.20% 2.65% 2.52% 1.48% 1.33% 2.42% 4.59% 80 ATLANTA INDEPENDENT SCHOOL SYSTEM ASSESSED AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY LAST TEN FISCAL YEARS Schedule 7 Fiscal Year Ended 4 December 31, 2004 December 31, 2005 June 30, 2006 June 30, 2007 June 30, 2008 June 30, 2009 June 30, 2010 June 30, 2011 June 30, 2012 June 30, 2013 Residential Property 10,282,698,452 10,842,205,309 11,954,278,920 13,202,618,136 13,980,076,949 13,611,726,261 12,749,326,810 12,609,751,900 11,506,413,986 10,896,664,314 Commercial Property 7,433,699,007 7,255,025,020 8,069,483,015 9,744,120,546 13,067,992,615 11,379,465,585 11,746,535,282 10,924,151,062 11,148,297,009 10,752,062,104 Industrial Property 308,725,135 618,322,584 699,409,813 776,908,905 1,031,326,231 801,084,215 806,421,455 775,954,220 758,400,890 723,400,082 Other Property 1 1,626,457,946 1,590,005,363 1,621,488,855 1,595,456,173 1,615,241,347 1,758,938,922 1,542,422,321 1,525,316,851 1,528,992,043 1,658,974,465 Less Tax-Exempt Property 2 1,732,722,383 186,756,118 1,720,017,791 1,887,341,520 2,093,949,974 2,409,353,965 2,831,876,995 2,731,195,758 2,880,803,214 2,660,010,749 Total Taxable Assessed Value 3 17,918,858,157 20,118,802,158 20,624,642,812 23,431,762,240 27,600,687,168 25,141,861,018 24,012,828,873 23,103,978,275 22,061,300,714 21,371,090,216 Source: Notes: Statistical section of the City of Atlanta, Georgia Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2013. 1 Other Property consist of Historical, Agricultural, Conservation, Utility, Motor Vehicle, Heavy Equipment, Timber, Motor Homes, etc. 2 Tax Exempt Property consist of Basic Homestead, Elderly, Disabled Veteran, Freeport, etc. 3 Assessed values are established by the Fulton & DeKalb Counties Board of Tax Assessors on January 1 of each year at 40% of the market value as required by State Law. 4 The City of Atlanta changed from a December 31 fiscal year to a June 30 fiscal year in 2006. Total Direct Tax Rate 31.00% 30.09% 32.13% 31.61% 30.49% 30.49% 33.63% 33.63% 33.63% 33.68% 81 Fiscal Year Ended 4 General Levy ATLANTA INDEPENDENT SCHOOL SYSTEM PROPERTY TAX RATES - ALL OVERLAPPING GOVERNMENTS (Per $1,000 Assessed Value) LAST TEN FISCAL YEARS Schedule 8 City Direct Rates School Levy Parks Levy City Bond Levy School Bond Levy Total Direct Tax Rate 2 Atlanta/ DeKalb County Special Tax District Downtown Improvement District Special Tax District 1 Overlapping Rates County Levy 3 Fulton County, Georgia County Georgia Bond State Levy Levy Total December 31, 2004 December 31, 2005 June 30, 2006 June 30, 2007 June 30, 2008 June 30, 2009 June 30, 2010 June 30, 2011 June 30, 2012 June 30, 2013 8.25 7.64 7.53 7.09 7.12 7.12 10.24 10.24 10.24 10.24 20.87 20.42 22.64 22.64 21.64 21.64 21.64 21.64 21.64 21.64 0.50 1.27 0.11 31.00 0.50 1.43 0.10 30.09 0.50 1.41 0.05 32.13 0.50 1.33 0.05 31.61 0.50 1.18 0.05 30.49 0.50 1.18 0.05 30.49 0.50 1.20 0.05 33.63 0.50 1.20 0.05 33.63 0.50 1.20 0.05 33.63 0.50 1.20 0.10 33.68 1.05 2.05 0.99 0.96 0.83 0.83 1.00 0.88 0.88 1.224 4.20 11.59 (3) 0.07 5.00 11.58 (3) 0.06 5.00 11.40 (3) 0.06 5.00 10.28 (3) 0.06 5.00 10.28 (3) 0.60 5.00 10.28 (3) 0.00 5.00 10.28 (3) 0.00 5.00 10.28 (3) 0.00 5.00 10.28 (3) 0.27 5.00 10.21 (3) 0.00 0.25 11.91 0.25 11.89 0.25 11.72 0.25 10.58 0.25 10.59 0.25 10.53 0.25 10.53 0.25 10.53 0.25 10.80 0.25 10.46 Source: Notes: Statistical section of the City of Atlanta, Georgia Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2013. 1 Tax imposed by property owners in the District pursuant to State authorization. 2 Reduced by debt service payment of $3,052,000 by the Atlanta Board of Education using its existing resources. 3 Hospital levy included in County levy. 4 The City of Atlanta changed from a December 31 fiscal year to a June 30 fiscal year in 2006. 82 Tax Payer Development Authority of Fulton 2 Georgia Power Company Coca-Cola Company Post Apartment Homes BF ATL, LLC Sun Trust Plaza Association Georgia Pacific Company Hines One Atlantic Center LP Corporate Property Corporation IEP PEACHTREE, LLC Total ATLANTA INDEPENDENT SCHOOL SYSTEM PRINCIPAL PROPERTY TAXPAYERS JUNE 30, 2012 AND NINE YEARS AGO 1 Schedule 9 2012 Type of Business Government Utility Service Marketing and Manufacturing Residential Real Estate Commercial Real Estate Commercial Real Estate Pulp and Paper Manufacturing Commercial Real Estate Commercial Real Estate Commercial Real Estate Taxable Assessed Value 1 $ 643,688,110 278,823,406 158,398,076 154,833,309 76,031,870 96,136,850 78,922,880 72,158,940 87,837,149 72,222,920 $ 1,719,053,510 Rank 1 2 3 4 8 5 7 10 6 9 Percentage of Total City Taxable Assessed Value 3.15% 1.36% 0.77% 0.47% 0.76% 0.43% 0.37% 0.35% 0.35% 0.39% 8.40% 2003 Tax Payer Bell South Coca-Cola Company Georgia Power Company Post Apartment Homes Georgia Pacific Company CSC Associates Sun Trust Plaza Association One Ninety One Peachtree Association Sumito Life Realty, Inc. Atlanta Center LTD Type of Business Communication Service Marketing and Manufacturing Utility Service Residential Real Estate Pulp and Paper Manufacturing Commercial Real Estate Commercial Real Estate Commercial Real Estate Commercial Real Estate Commerical Real Estate Taxable Assessed Value $ 311,493,227 162,670,820 138,389,311 116,171,210 90,792,750 87,338,740 82,038,220 76,478,710 63,170,490 58,083,570 Total $ 1,186,627,048 Sources: Notes: 2012 - Statistical section of the City of Atlanta, Georgia Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2012. 2003 - Statistical section of the City of Atlanta, Georgia Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2012. 1. Information for FY2013 was not available. 2. Development Authority of Fulton does not pay taxes but does temporarily hold property for others who pay taxes. Rank 1 2 3 4 5 6 7 8 9 10 Percentage of Total City Taxable Assessed Value 1.69% 0.88% 0.75% 0.63% 0.49% 0.47% 0.44% 0.41% 0.34% 0.31% 6.41% 83 ATLANTA INDEPENDENT SCHOOL SYSTEM PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS Schedule 10 Fiscal Year Ended 3 Taxes Levies for the Fiscal Year Collected within the Fiscal Year of the Levy Percentage of Amount 1 Levy Collections in Subsequent Years Total Collections To Date Percentage of Amount Levy December 31, 2004 180,733,587 170,502,285 94.34% 9,752,408 2 December 31, 2005 178,703,068 160,301,279 89.70% 17,909,963 2 June 30, 2006 6,750,195 6,750,195 100.00% - June 30, 2007 179,606,933 164,976,460 91.85% 13,929,773 2 June 30, 2008 182,020,745 173,030,142 95.06% 7,984,231 June 30, 2009 198,377,854 190,475,498 96.02% 6,292,394 June 30, 2010 264,371,198 257,062,077 97.24% 4,473,563 June 30, 2011 240,585,957 234,894,781 97.63% 2,379,716 June 30, 2012 222,632,704 218,471,864 98.13% 1,394,434 June 30, 2013 219,176,582 214,493,637 97.86% - Source: . Statistical section of the City of Atlanta, Georgia Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2013. Notes: 1 Does not include tax revenues retained by Fulton and DeKalb County for administrative expenditures; therefore, the collection rate shown is slightly less than actual. 2 Adjusted to collection in subsequent year. 3 The City of Atlanta changed from a December 31 fiscal year to a June 30 fiscal year in 2006. 180,254,693 178,211,242 6,750,195 178,906,233 181,014,373 196,767,892 261,535,640 237,274,497 218,471,864 214,493,637 99.74% 99.72% 100.00% 99.61% 99.45% 99.19% 98.93% 98.62% 98.13% 97.86% 84 ATLANTA INDEPENDENT SCHOOL SYSTEM COMPARISON OF PROPERTY TAX MILLAGE RATES AS OF JUNE 30, 2013 Last Ten Fiscal Years Schedule 11 Atlanta Public Schools Clayton County Schools Cobb County Schools DeKalb County Schools Douglas County Schools Fulton County Schools Gwinnett County Schools Rockdale County Schools TOTAL RATE 21.74 20.00 18.90 23.98 21.95 18.50 20.55 24.50 MAINTENANCE AND OPERATION 21.64 20.00 18.90 23.98 19.85 18.50 19.25 24.50 Sources: Note: Department of Revenue, Tax Digest Millage Rates All tax rates are per $1000 assessed valuation. DEBT SERVICE 0.10 0.00 0.00 0.00 2.10 0.00 1.30 0.00 85 Tax Year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Sources: ATLANTA INDEPENDENT SCHOOL SYSTEM TAX MILLAGE RATES LAST TEN TAX YEARS Schedule 12 Maintenance and Operations 20.42 20.42 22.64 22.64 21.64 21.64 21.64 21.64 21.64 21.64 Sinking Bond Fund 0.10 0.10 0.054 0.054 0.054 0.054 0.054 0.054 0.100 0.100 Total Levy 20.524 20.524 22.694 22.694 21.694 21.694 21.694 21.694 21.740 21.740 Comments Decrease of 1.05 mills No change from 2004 Increase of 2.17 mills No change from 2006 Decrease of 1.000 mills No change from 2008 No change from 2009 No change from 2010 Increase of .046 mills No change from 2012 Atlanta Public Schools June 2010 Tax Levy Board Resolutions for tax year 2011 Georgia Department of Revenue for tax years 2004-2010, 2013 86 ATLANTA INDEPENDENT SCHOOL SYSTEM RATIOS OF TOTAL DEBT OUTSTANDING BY TYPE ( UNAUDITED) GOVERNMENTAL ACTIVITIES FOR THE LAST TEN FISCAL YEARS Schedule 13 Fiscal Year Education Reform Intergovernmental Ended June 30, Success ( COPS) Agreement 2004 (1) - - 2005 (1) - - 2006 - 18,697,134 2007 10,115,000 22,112,675 2008 10,115,000 21,385,800 2009 9,565,000 20,488,750 2010 8,995,000 19,461,875 2011 115,912,709 18,439,000 2012 114,764,042 17,398,125 2013 107,431,623 16,311,250 Capital Leases 11,248,793 6,862,557 4,219,951 5,159,414 23,618,868 18,255,388 13,998,496 9,682,005 7,905,594 6,018,646 Total Debt (2) 11,248,793 6,862,557 22,917,085 37,387,089 55,119,668 48,309,138 42,455,371 144,033,714 140,067,761 129,761,519 Estimated Actual Value of Taxable Property (3) 17,918,858,157 20,118,802,158 20,624,642,812 23,431,762,240 27,600,687,168 25,141,861,018 24,012,828,873 23,103,978,275 22,061,300,714 21,371,090,216 Ratio of Total Debt to Est. Actual Value 0.06% 0.03% 0.11% 0.16% 0.20% 0.19% 0.18% 0.62% 0.63% 0.61% Personal Income (4) 162,297,000 173,159,000 184,186,000 184,186,000 196,683,000 198,580,000 206,462,000 203,137,000 202,577,000 212,830,000 Ratio of Total Debt to Personal Income 6.93% 3.96% 12.44% 20.30% 28.02% 24.33% 20.56% 70.90% 69.14% 60.97% Source: Atlanta Independent School System Financial Reports for previous years and fiscal year ended June 30, 2013. Notes: 1 The City of Atlanta changed from a December 31 fiscal year to a June 30 fiscal year in 2006. 2 See the schedule of Long Term Debt in the Notes for each year for more information on the debt. 3 See schedule 7 - Assessed and Estimated Actual Value of Taxable Property . 4 See schedule 15 - Demographics Statistics. 87 Elementary Schools 1 Adamsville 2 Beecher Hills 3 Benteen 4 Bethune 5 Bolton Academy 6 Boyd 7 Brandon 8 Brandon Primary 9 Burgess-Peterson 10 Cascade 11 Centennial Place 12 Cleveland 13 Connally 14 Continental Colony 15 Deerwood Academy 16 Dobbs 17 Dunbar 18 Fain 19 Fickett 20 Finch 21 Garden Hills 22 Gideons 23 Grove Park 24 Heritage Academy 25 Hope - Hill 26 Humphries 27 Hutchinson 28 Jackson 29 Jackson Primary 30 Jones, M. A. 31 Kimberly 32 Lin, Mary 33 Miles 34 Morningside 35 Parkside 36 Perkerson 37 Peyton Forest 38 Rivers (@ fmr Sutton MS) 39 Scott 40 Slater 41 Smith, Sarah 42 Smith Intermediate 43 Springdale Park 44 Stanton, D. H. ATLANTA INDEPENDENT SCHOOL SYSTEM SCHOOL BUILDINGS, ACREAGE, AND CAPACITY June 30, 2013 Schedule 14 School Acreage, Square Footage, Planning Capacity, Area per Student, Effective Age Region Acres Sq.Ft. Planning Capacity @ 25/1 SF per Student Core Original Classrooms Construction Renovation Actual Age (2013 basis) W 4.9 75,058 750 100 30 1970 2001 43 W 9.5 49,925 525 95 21 1959 1999 54 E 4.0 68,440 600 114 24 1957 2000 56 W 4.5 78,561 825 95 33 1949 1999 64 N 4.0 83,653 900 93 36 2003 10 N 19.7 72,405 575 126 23 1971 42 N 10.0 86,138 875 98 35 1947 1994 66 N 9.8 59,941 625 96 25 1954 2009 59 E 8.3 85,836 875 98 35 2004 9 W 8.7 70,286 625 112 25 1995 18 E 5.0 63,806 650 98 26 1998 15 S 4.8 75,880 675 112 27 1996 17 W 3.7 88,417 1,000 88 40 1975 2000 38 W 8.7 85,562 600 143 24 1963 2011 50 W 21.0 88,980 900 99 36 2004 9 S 19.6 86,370 900 96 36 2003 10 E 5.3 98,959 500 198 20 1969 2009 44 N 8.0 83,782 700 120 28 1987 26 W 12.0 86,490 900 96 36 1972 1994 41 S 4.1 95,024 950 100 38 2005 8 N 8.0 82,176 775 106 31 1938 2003 75 S 4.5 72,402 825 88 33 1958 2000 55 N 7.0 88,921 725 123 29 1967 2000 46 S 7.0 80,864 850 95 34 2002 11 E 2.4 65,886 700 94 28 2002 11 S 8.2 66,228 650 102 26 1940 1998 73 S 8.5 70,797 825 86 33 1956 1994 57 N 12.5 95,591 850 112 34 1967 1994 46 N 7.2 48,982 500 98 20 1959 2008 54 W 7.5 92,272 875 105 35 2005 8 W 7.2 63,379 825 77 33 1958 1999 55 E 5.2 60,414 600 101 24 1930 1994 83 W 15.0 82,211 900 91 36 2003 10 E 5.2 97,995 900 109 36 1930 1994 83 E 8.3 80,836 775 104 31 2001 12 S 9.0 75,297 700 108 28 1994 19 W 25.0 64,300 625 103 25 1968 1999 45 N 12.5 160,667 1,000 161 40 1950 1999 63 N 8.0 72,891 800 91 32 1960 2006 53 S 13.0 78,232 800 98 32 1952 2002 61 N 10.3 70,545 750 94 30 1952 1994 61 N 6.2 78,173 750 104 30 2009 4 E 4.5 56,418 625 90 25 2009 4 E 6.0 75,674 825 92 33 1959 2000 54 Effective Age Basis 2001 1999 2000 1999 2003 1971 1994 2009 2004 1995 1998 1996 2000 2011 2004 2003 2009 1987 1994 2005 2003 2000 2000 2002 2002 1998 1994 1994 2008 2005 1999 1994 2003 1994 2001 1994 1999 1999 2006 2002 1994 2009 2009 2000 Effective Age (2013 basis) 12 14 13 14 10 42 19 4 9 18 15 17 13 2 9 10 4 26 19 8 10 13 13 11 11 15 19 19 5 8 14 19 10 19 12 19 14 14 7 11 19 4 4 13 88 Elementary Schools 45 Stanton, F. L. 46 Thomasville Heights 47 Toomer 48 Towns 49 Usher - Collier 50 Venetian Hills 51 West Manor 52 Whitefoord 53 Woodson Elementary School Totals Middle Schools 1 BEST (see HS) 2 Brown 3 Bunche (@ fmr Archer HS) ATLANTA INDEPENDENT SCHOOL SYSTEM SCHOOL BUILDINGS, ACREAGE, AND CAPACITY June 30, 2013 Schedule 14 School Acreage, Square Footage, Planning Capacity, Area per Student, Effective Age Region Acres Sq.Ft. Planning Capacity @ 25/1 SF per Student Core Classrooms Original Construction Renovation N 5.2 62,930 425 148 17 1928 2000 S 11.2 83,023 950 87 38 1971 2001 E 10.6 70,012 700 100 28 1967 1998 N 8.9 70,084 675 104 27 1963 2000 N 14.0 102,962 900 114 36 1969 2003 W 9.3 60,924 600 102 24 1954 1994 W 10.8 37,150 400 93 16 1956 2000 E 2.3 62,712 650 96 26 1928 1994 N 4.1 79,637 675 118 27 1971 1998 460.2 4,094,098 39,375 105 1,575 1971 Region Acres Sq.Ft. Planning Capacity @ 25/1 SF per Student Core Classrooms Original Construction Renovation N W 15.6 153,243 975 157 39 1928 2001 W 19.5 247,360 1,625 152 65 1957 1972 Actual Age (2013 basis) 85 42 46 50 44 59 57 85 42 42 Actual Age (2013 basis) 85 56 4 Coan (@ fmr East Lake ES) E 2.7 66,168 575 115 23 1949 1994 64 5 Harper - Archer N 18.1 229,745 1,100 209 44 1963 2002 50 6 Inman E 4.2 151,713 875 173 35 1923 2005 90 7 Kennedy W 5.0 228,028 1,025 222 41 1970 2004 43 8 King, C.S. (see HS) N 9 King, M.L. E 6.5 176,547 1,000 177 40 1973 2003 40 10 Long S 15.6 125,236 900 139 36 1958 2006 55 11 Price S 19.0 167,168 975 171 39 1954 2002 59 12 Sutton (@ fmr N. Atlanta HS) N 13 Sylvan (@ fmr Parks MS) S 14 Young W Middle School Totals 17.5 5.8 15.0 144.5 High Schools Region Acres 1 BEST (includes MS) N 15.1 2 Carver S 35.4 3 Crim E 17.9 4 Douglass N 32.0 5 Forrest Hill S 5.8 6 Grady E 19.5 7 Jackson, M. (@ Coan MS) E 16.1 8 King, C.S. (includes MS) N 21.2 9 Mays W 70.0 10 North Atlanta (New) N 56.6 11 South Atlanta S 50.2 12 Therrell W 17.3 13 Washington W 21.1 High School Totals 378.2 208,445 1,300 160 52 1951 2011 79,630 625 127 25 1966 1996 172,986 975 177 39 1951 2009 2,006,269 11,950 165 478 1954 Sq.Ft. Planning Capacity @ 25/1 SF per Student Core Classrooms Original Construction Renovation 217,578 1,750 124 70 2009 271,429 1,525 178 61 1920 2005 203,949 925 220 37 1940 2007 336,101 1,950 172 78 1968 2004 69,254 750 92 30 2008 274,560 1,275 215 51 1924 2005 167,169 1,025 163 41 1967 2003 264,874 1,750 151 70 2009 339,758 1,550 219 62 1981 2011 507,093 2,425 209 97 1978 2013 277,779 1,500 185 60 1973 2008 261,273 1,150 227 46 1960 2011 261,269 1,625 161 65 1924 2005 3,452,086 19,200 178 768 1,966 62 47 62 59 Actual Age (2013 basis) 4 93 73 45 5 89 46 4 32 35 40 53 89 47 Effective Effective Age Age Basis (2013 basis) 2000 13 2001 12 1998 15 2000 13 2003 10 1994 19 2000 13 1994 19 1998 15 2000 13 Effective Effective Age Age Basis (2013 basis) 2001 12 1972 41 1994 19 2002 11 2005 8 2004 9 2003 10 2006 7 2002 11 2011 2 1996 17 2009 4 2000 13 Effective Effective Age Age Basis (2013 basis) 2009 4 2005 8 2007 6 2004 9 2008 5 2005 8 2003 10 2009 4 2011 2 2013 0 2008 5 2011 2 2005 8 2007 6 89 Fiscal Year Ended 1 December 31, 2004 December 31, 2005 June 30, 2006 June 30, 2007 June 30, 2008 June 30, 2009 June 30, 2010 June 30, 2011 June 30, 2012 June 30, 2013 Population 434,900 442,100 451,600 451,600 461,956 477,300 480,700 420,003 432,427 443,775 ATLANTA INDEPENDENT SCHOOL SYSTEM DEMOGRAPHIC STATISTICS LAST TEN FISCAL YEARS Schedule 15 Personal Income (thousands of dollars) Per Capita Personal Income Median Age 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 35.0 206,462 38,336 35.0 203,137 37,101 34.0 202,577 38,321 32.9 212,830 39,713 33.0 Sources: 1 Statistical section of the City of Atlanta, Georgia 2013 Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2013. Note: 1 The City of Atlanta changed from a December 31 fiscal year to a June 30 fiscal year in 2006. School Enrollment 51,358 50,188 49,924 49,707 51,377 48,093 48,696 49,874 49,474 48,831 Unemployment Rate 7.4% 5.9% 5.3% 4.5% 5.9% 10.3% 10.0% 10.5% 8.9% 8.6% 90 Employer Delta Air Lines, Inc The Coca-Cola Company International Business Machine Corp. Turner Broadcasting System, Inc. Cable News Network, Inc. AT & T Services Inc. Air Service Corp Accenture LLP Allied Barton Security Systems Tenet Health System, Inc. Total Employer International Business Machine Corp Georgia-Pacific Efficeiency Plus Consultants The Coca-Cola Company Cable News Network, Inc. Atlanta Journal and Constitution Allied Barton Security Service Tenet Health System, Inc. Turner Entertainment Networks Turner Broadcasting System, Inc. Skanska USA Building, Inc. Total ATLANTA INDEPENDENT SCHOOL SYSTEM PRINCIPAL EMPLOYERS JUNE 30, 2012 AND NINE YEARS AGO Schedule 16 2012 Type Of Business Employees Transportation Marketing and Manufacturing Technology Services Media/Entertainment Media Telecommunication Transportation Consulting Security Services Healthcare 3,815 3,469 4,228 2,163 1,873 1,845 1,733 1,791 1,448 1,140 23,505 2003 Type Of Business Technology Services Pulp and Paper Manufacturing Consulting Marketing and Manufacturing Media Media Security Service Healthcare Entertainment Media/Entertainment Construction-related Services Employees 3,683 3,352 3,200 3,095 2,087 1,664 2,395 1,400 1,029 912 793 23,610 Percentage of Total City Employment 1.98% 1.80% 2.20% 1.12% 0.97% 0.96% 0.90% 0.93% 0.75% 0.59% 12.20% Percentage of Total City Employment 1.90% 1.73% 1.65% 1.60% 1.08% 0.86% 1.30% 0.72% 0.53% 0.47% 0.41% 12.25% Source: 2013 - Statistical section of the City of Atlanta, Georgia 2013 Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2013. 91 ATLANTA INDEPENDENT SCHOOL SYSTEM GENERAL FUND PER PUPIL COST LAST TEN FISCAL YEARS Last Ten Fiscal Years Schedule 17 Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Expenditures 1 533,269 502,432 509,458 536,734 591,778 618,667 630,734 610,014 604,635 576,388 Active Enrollment 2 52,103 51,377 50,631 50,631 49,991 49,032 48,909 49,796 50,009 49,558 Cost Per Pupil Enrolled 10,235 9,779 10,062 10,601 11,838 12,618 12,896 12,250 12,091 11,631 Average Daily Attendance 3 49,565 49,138 44,534 48,720 44,935 51,449 52,368 52,925 47,192 46,403 Cost Per Pupil Attended 10,759 10,225 11,440 11,017 13,170 12,025 12,044 11,526 12,812 12,421 Sources: 1 Atlanta Independent School System General Fund Expenditures by Function schedule for fiscal year ended June 30, 2013 (amounts expressed in thousands). 2 GA Department of Education, Enrollment by Grade report, based on the October count of each fiscal year. 3 Average daily attendance figures from the APS Attendance/Membership Summary Report as of June 30 of each fiscal year. 92 Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: ATLANTA INDEPENDENT SCHOOL SYSTEM SCHOOL BREAKFAST PROGRAM LAST TEN FISCAL YEARS MEALS SERVED Schedule 18 Total Free Reduced 3,249,614 2,788,851 2,707,493 2,782,559 2,854,746 2,884,599 3,077,775 3,499,392 3,869,946 3,718,353 2,935,318 2,499,934 2,435,219 2,490,514 2,597,420 2,634,544 2,822,180 3,173,080 3,487,626 3,368,341 72,924 83,064 85,014 105,082 85,533 78,887 77,739 78,260 86,082 77,277 Nutrition Department of APS Paid 241,372 205,853 187,260 186,963 171,793 171,168 177,856 248,052 296,238 272,735 93 Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: ATLANTA INDEPENDENT SCHOOL SYSTEM SCHOOL LUNCH PROGRAM LAST TEN FISCAL YEARS MEALS SERVED Schedule 19 Total 6,597,114 6,040,086 5,980,314 5,938,199 5,894,475 5,919,633 5,835,665 5,840,231 5,803,075 5,426,460 Free 5,420,054 4,929,194 4,924,894 4,886,222 4,943,800 4,961,606 4,968,698 5,032,509 5,043,598 4,799,240 Reduced 230,992 283,294 289,292 314,070 272,290 252,189 223,230 168,063 158,924 126,324 Nutrition Department of APS Paid 946,068 827,598 766,128 737,907 678,385 705,838 643,737 639,659 600,553 500,896 94 Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 ATLANTA INDEPENDENT SCHOOL SYSTEM NUMBER OF SCHOOLS LAST TEN FISCAL YEARS Schedule 20 Total Elementary Middle 89 63 16 85 59 16 89 59 16 94 58 16 93 57 17 95 57 19 96 55 18 96 55 16 100 58 18 86 50 15 Source: Atlanta Public Schools - The District- Fast Facts High 10 10 14 20 19 19 23 25 24 21 95 ATLANTA INDEPENDENT SCHOOL SYSTEM ENROLLMENT BY GRADE LEVEL ( UNAUDITED) LAST TEN FISCAL YEARS Schedule 21 Grade Level PK KK Grade 1 Grade 2 Grade 3 Grade 4 Grade 5 Grade 6 Grade 7 Grade 8 Grade 9 Grade 10 Grade 11 Grade 12 Totals 2004 788 4,481 4,503 4,319 4,383 4,392 4,393 3,898 3,998 3,828 4,131 3,352 2,999 2,638 52,103 2005 841 4,562 4,530 4,290 4,351 3,930 4,261 3,979 3,757 3,815 4,253 3,380 2,885 2,543 51,377 2006 805 4,762 4,501 4,284 4,264 4,086 3,921 3,807 3,794 3,597 4,332 3,268 2,925 2,424 50,770 2007 858 4,758 4,739 4,348 4,286 3,992 3,948 3,526 3,622 3,739 4,073 3,291 2,900 2,551 50,631 2008 890 4,476 4,711 4,545 4,330 4,065 3,874 3,509 3,309 3,580 4,204 3,197 2,854 2,447 49,991 2009 885 4,351 4,503 4,543 4,337 4,040 3,903 3,314 3,347 3,190 4,309 2,948 2,893 2,469 49,032 2010 965 4,501 4,377 4,431 4,431 4,168 3,904 3,451 3,204 3,303 4,420 2,873 2,354 2,527 48,909 2011 991 4,598 4,601 4,248 4,481 4,221 4,177 3,623 3,490 3,242 4,412 2,982 2,299 2,431 49,796 2012 2013 1,111 4,795 4,609 4,379 4,269 4,266 4,172 3,563 3,503 3,465 4,475 3,003 2,352 2,047 1,098 4,822 4,698 4,417 4,289 3,962 4,094 3,603 3,471 3,379 4,395 2,928 2,346 2,056 50,009 49,558 Source: GA Department of Education, Enrollment by Grade report, based on the October count of each fiscal year. 96 ATLANTA INDEPENDENT SCHOOL SYSTEM EMPLOYEES BY FUNCTION ( Unaudited) FOR THE LAST TEN FISCAL YEARS Schedule 22 Function Fiscal Year Ended June 30, 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Instruction Pupil Services Improvement of Instructional Services Educational Media Services General Administration School Administration Business Administration Maintenance and Operations Student Transportation Services Central Services Other Supporting Services Nutrition Operations Facilities, Acquisition and Contruction 5,887 381 93 128 63 470 87 802 425 198 52 370 6 5,464 386 110 123 64 453 91 733 415 174 55 218 5 5,300 335 97 122 65 443 75 639 412 168 56 175 3 5,212 297 272 127 46 429 159 564 425 132 52 154 0 5,298 341 265 126 47 453 162 540 421 136 79 143 0 5,137 365 303 124 68 449 189 632 424 129 81 136 1 5,170 348 327 121 79 434 188 628 439 128 86 122 1 4,892 350 314 123 84 438 199 630 446 136 93 119 2 4,743 303 387 118 57 431 187 667 431 132 180 108 2 4,568 224 318 116 64 440 161 578 444 142 91 101 2 Totals 8,962 8,291 7,890 7,869 8,011 8,038 8,071 7,826 7,746 7,249 Source: Information Technology Department of APS 97