The URL can be used to link to this page

Joint Review Board Packet 2014 11-25-14NOTICE OF ANNUAL MEETING OF JOINT REVIEW BOARD Kendall Township Kendall County 9513 Walker Road 111 West Fox Street Yorkville, Illinois 60560 Yorkville, Illinois 60560 Waubonsee Community College Dist. #516 Yorkville School District #115 Route 47 at Waubonsee Drive 602 Center Parkway, #A Sugar Grove, Illinois 60554 Yorkville, Illinois 60560 Bristol-Kendall Fire Protection District United City of Yorkville 103 East Beaver Street 800 Game Farm Road Yorkville, Illinois 60560 Yorkville, Illinois 60560 Bristol Township Kendall County Forest Preserve 9075 Corneils 110 W Madison Street Bristol, Illinois 60512 Yorkville, Illinois 60560 YOU ARE HEREBY NOTIFIED that a meeting of the annual Joint Review Board(s) to review the annual reports for the US Route 34/IL Route 47 Countryside Shopping Center and Downtown Tax Increment Financing Redevelopment Project Areas will be convened November 25, 2014 at 3:00 p.m. at the United City of Yorkville, City Hall, 800 Game Farm Road, Yorkville, Illinois 60560. PLEASE BE ADVISED that the Joint Review Board(s) shall elect or re-elect a public member as well as a chairperson. In accordance with the provisions of the Tax Increment Allocation Redevelopment Act (the “Act”) (65 ILCS 5/11-74.1-1, et seq.), the Joint Review Board(s) shall review the annual report(s) for the US Route 34/IL Route 47 Countryside Shopping Center and Downtown Redevelopment Project Areas. /s/ Beth Warren, City Clerk AGENDA ANNUAL JOINT REVIEW BOARD OF THE UNITED CITY OF YORKVILLE US RTE 34 & IL RTE 47 COUNTRYSIDE AND DOWNTOWN REDEVELOPMENT PROJECT AREAS November 25, 2014 United City of Yorkville, City Hall 3:00 p.m. 800 Game Farm Road, Yorkville, Illinois 1. Roll Call United City of Yorkville Kendall Township Kendall County Kendall County Forest Preserve Waubonsee Community College Dist. #516 Yorkville School Dist #115 Bristol-Kendall Fire Protection District Bristol Township 2. Call Meeting To Order 3. Motion to elect or re-elect Public Member 4. Motion to elect or re-elect Chairperson 5. Minutes for Approval 6. Review of Annual Report for US Rte 34 & IL Rte 47 Countryside and Downtown Redevelopment Project Areas 7. Discussion 8. Adjournment Table of Contents Minutes of the Fiscal Year 2013 Joint Review Board .............................................................................. 1 US Route 34 & IL Route 47 (Countryside) TIF Report .......................................................................... 4 Certification of Chief Executive Officer ................................................................................................. 17 Legal Council Opinion ............................................................................................................................ 18 Activities Statement ................................................................................................................................ 19 Development Agreements ....................................................................................................................... 20 2014 Countryside Refunding Bond Official Statement .......................................................................... 49 Debt Coverage Analysis ........................................................................................................................ 139 Audited Financial Statements ............................................................................................................... 151 Auditor Compliance Letter ................................................................................................................... 159 Downtown TIF Report ........................................................................................................................... 160 Certification of Chief Executive Officer ............................................................................................... 173 Legal Council Opinion .......................................................................................................................... 174 Activities Statement .............................................................................................................................. 175 Development Agreements ..................................................................................................................... 176 Audited Financial Statements ............................................................................................................... 193 Auditor Compliance Letter ................................................................................................................... 201 This page intentionally left blank. FY 2013 Annual Joint Review Board for TIF Districts Tuesday, November 26, 2013 2:00 p.m. Yorkville City Hall Conference Room 800 Game Farm Road, Yorkville, IL 60560 Committee Members in Attendance: Dean Romano, Asst. Supt. for Finance & Operations – Yorkville CUSD #115 City Officials in Attendance: Bart Olson, City Administrator – United City of Yorkville Rob Fredrickson, Finance Director - United City of Yorkville Kathleen Field Orr, City Attorney – Kathleen Field Orr & Associates Other Attendees: No other attendees Elect Public Member There was no public member present so City Attorney Orr stated they would forego it. Elect Chair Person Administrator Olson made a motion to elect Mr. Romano as Chairperson. Mr. Romano seconded; the motion was carried and Mr. Romano is the Chairperson. Mr. Romano took roll and called the meeting to order. He opened the annual meeting by asking for approval of the minutes from the last meeting (November 27, 2012). Director Fredrickson made one amendment to the minutes to reflect “2012” rather than “2011.” (Correction has been made.) No other changes were necessary; minutes approved with correction. Annual Report for U.S. Route 34 & Route 47 – Countryside TIF District: Mr. Romano asked Director Fredrickson to provide some feedback on above subject. Director Fredrickson opened by referring to page 6 of the report which showed fund balance to be $1,877,872 as of May 1, 2012. During the year, there were total revenues of $2,132; total expenditures of $307,669; resulting in an ending fund balance of $1,572,335. Pages seven, eight and nine of the TIF Report provide further expenditure details. At this point, City Attorney Orr asked Mr. Romano if he knew the history of the Countryside TIF. Mr. Romano responded that he did not. City Attorney Orr explained that the TIF was established in 2005 because Kohl’s was expected to open a new store in Yorkville. In order to facilitate this project, the City issued a bond for $3.525 million. Minimal work was completed on the project before the developer pulled out and Kohl’s ended up constructing a new store in the City’s Kendall Marketplace Business District instead. 1 Since then the City has used the bond proceeds to pay debt service, since there is no revenue coming in from the property. The City has been hoping for a developer ever since and then Mr. Jim Ratos comes in and said, “We need a cinema!” and NGC Theatres opens in November of 2013. The agreement the City made with Mr. Ratos will be in next year’s packet since it was not passed until May of 2013. The agreement stipulates that Mr. Ratos gets an incentive payout totaling $2 million, consisting of remaining bond proceeds of approximately $1.8 million with the remainder ($200,000) to be paid from Amusement Tax receipts. City Attorney Orr went on to say that when the TIF was initially established, the base EAV still had the initial building. Therefore, continuing with the TIF as it is right now, she asked if the City is going to ask for an extension on the bond? Administrator Olson responded that it would depend on the refinancing being stretched to be coterminous with the life of the TIF district, which ends in 2029. Mr. Romano asked if there was space and if it covered out buildings. Administrator Olson and City Attorney Orr confirmed that it did. Administrator Olson went on to say that northwest of the theatre site there is actually a larger lot than what the theatre is on now. This could be sub- divided further into a lot of smaller lots; however, the thought is that the City would like another larger, anchor tenant in there. Mr. Olson stated this year’s TIF report is particularly bland because there are few expenses and not much has been done. Within the next two years, there will be a new re-development agreement and hopefully some revenue to actually pay off the bonds. City Attorney Orr stated that she wanted to point out one other thing regarding the Countryside TIF. On page 16 of the current year’s report, when the TIF was established in 2005 the base EAV was $1,528,166. She then noted that the current EAV (before construction) is less than the base year. So, if the City had waited to establish the TIF, the school district would have lost the $1.5 million base that they can at least get now. Mr. Romano said he was familiar with the concept of TIF’s moving into a lower EAV situation. Annual Report for Downtown Yorkville TIF District: Director Fredrickson referenced page 30 of the TIF report, which identifies a summary of the activity in the Downtown TIF for fiscal year 2013. During the year, there were total revenues of $45,409; total expenditures of $86,425; resulting in an ending fund balance of $216,937. Administrator Olson stated there was an error in the report showing $3,506,099 in “Cumulative Bond Proceeds” that matches the amount in Countryside TIF report. City Attorney Orr said that number should not be there. Mr. Olson said the rest of the numbers looked fine and that the cumulative bond proceeds number should be “0” - for the record. City Attorney Orr stated that fund balance for the Downtown TIF is $216,000; $200,000 of which is committed to the Route 47 expansion project. She went on to say that there is a redevelopment agreement with Imperial Investments as a business district overlay. City Attorney Orr stated that one of the issues with the TIF was that in the base year the EAV was already $5.7 million, so it’s only gone up less than $1 million since it was established in 2006. She went on to say that this is not a realistic evaluation of the TIF’s EAV. 2 Administrator Olson said there were a couple of minor expenses throughout the year, as noted on pages 31through 33 of the TIF report. There were some marketing costs for conference attendance and engineering services (FS Grainco property east alley). The City has a Brownfield Grant (that they have been doing a study for); clean-up costs for minor repairs on the old Post Office and some other City buildings within the TIF district; and the Route 47 costs that were previously discussed. He projected that next year’s TIF report will show some increment going to Imperial Investments for projects that they have done. Mr. Romano asked if there was a commitment to that group. City Attorney Orr stated the City owes them at least $500,000 at this time, per their investment identified in the TIF report. Administrator Olson said that on the November 26, 2013 City Council agenda, the City is considering accelerating some decorative street lights, if Council approves a grant. In addition, there are probably a few more minor projects that are TIF eligible associated with Riverfront Park. There is a separate grant to do that. There might be some other things they choose to do down there (aesthetic based) that would also qualify as TIF expenses. City Attorney Orr said basically the TIF is very small and conservative. The only way it would ever include residential property is if residences are built at Kendallwood Estates (owned by Imperial Investments which bought the platted subdivision), which is currently dormant. The infrastructure is all there (they built roads, detention basins, water and sewer), they just have not seen a market for it. Mr. Romano asked if they do develop it, would they be able to receive the per pupil disbursement. City Attorney Orr assured him that he would. Administrator Olson asked if there was anything else TIF related and Mr. Romano said he had nothing else; he was up-to-speed. He then moved to adjourn the meeting; Mr. Olson seconded it. All were in favor; no one opposed and the meeting was adjourned at 2:16 p.m. Minutes respectfully submitted by: Bonnie Olsem Administrative Secretary 3 Countryside TIF District 4 SECTION 2 [Sections 2 through 5 must be completed for each redevelopment project area listed in Section 1.] FY 2014 Name of Redevelopment Project Area: Primary Use of Redevelopment Project Area*: If "Combination/Mixed" List Component Types: No Yes Werethere any amendments to theredevelopmentplan,theredevelopmentproject area,or the State Sales Tax Boundary? [65 ILCS 5/11-74.4-5 (d) (1) and 5/11-74.6-22 (d) (1)] If yes, please enclose the amendment labeled Attachment A x Certificationof theChiefExecutive Officerof the municipality that the municipality has compliedwith all of therequirements of the Act duringthepreceding fiscalyear.[65 ILCS 5/11-74.4-5 (d)(3)and 5/11-74.6- 22 (d) (3)] Please enclose the CEO Certification labeled Attachment B x Opinionof legalcounsel that municipalityisincompliancewith the Act.[65 ILCS 5/11-74.4-5 (d)(4)and 5/11-74.6-22 (d) (4)] Please enclose the Legal Counsel Opinion labeled Attachment C x Werethere any activities undertaken in furtherance of theobjectives of theredevelopmentplan, including any projectimplemented in thepreceding fiscalyearand adescriptionof the activities undertaken? [65 ILCS 5/11-74.4-5 (d) (7) (A and B) and 5/11-74.6-22 (d) (7) (A and B)] If yes, please enclose the Activities Statement labeled Attachment D x Were any agreementsentered into bythe municipalitywith regard to the dispositionor redevelopment of any property within theredevelopmentproject area or the area within the State Sales Tax Boundary? [65 ILCS 5/11-74.4-5 (d) (7) (C) and 5/11-74.6-22 (d) (7) (C)] If yes, please enclose the Agreement(s) labeled Attachment E x Is there additionalinformationon the use of all fundsreceivedunder thisDivision and steps taken bythe municipality to achieve theobjectives of theredevelopmentplan?[65 ILCS 5/11-74.4-5 (d)(7)(D)and 5/11-74.6-22 (d) (7) (D)] If yes, please enclose the Additional Information labeled Attachment F x Did the municipality's TIF advisors or consultantsenter into contracts with entities or persons thathave received or are receivingpaymentsfinancedby tax incrementrevenuesproducedbythe same TIF?[65 ILCS 5/11-74.4-5 (d) (7) (E) and 5/11-74.6-22 (d) (7) (E)] If yes, please enclose the contract(s) or description of the contract(s) labeled Attachment G x Werethere any reports or meetingminutessubmitted to the municipality bythe joint reviewboard?[65 ILCS 5/11-74.4-5 (d) (7) (F) and 5/11-74.6-22 (d) (7) (F)] If yes, please enclose the Joint Review Board Report labeled Attachment H x Were any obligations issued by municipality? [65 ILCS 5/11-74.4-5 (d) (8) (A) and 5/11-74.6-22 (d) (8) (A)] If yes, please enclose the Official Statement labeled Attachment I x Wasanalysis preparedby a financialadvisor or underwritersetting forth thenature and term of obligation and projecteddebt service includingrequiredreserves and debtcoverage?[65 ILCS 5/11-74.4- 5 (d) (8) (B) and 5/11-74.6-22 (d) (8) (B)] If yes, please enclose the Analysis labeled Attachment J x Cumulatively,havedepositsequalorgreaterthan$100,000beenmade into the special tax allocation fund? 65 ILCS 5/11-74.4-5 (d) (2) and 5/11-74.6-22 (d) (2) If yes, please enclose Audited financial statements of the special tax allocation fund labeled Attachment K x Cumulatively,havedepositsofincrementalrevenueequal to orgreaterthan$100,000beenmade into the special tax allocation fund? [65 ILCS 5/11-74.4-5 (d) (9) and 5/11-74.6-22 (d) (9)] If yes,pleaseenclose a certifiedletterstatement reviewing compliance with the Act labeled Attachment L x A list of all intergovernmental agreements in effect in FY 2010, to which the municipality is a part, and an accounting of any money transferred or received by the municipality during that fiscal year pursuant to those intergovernmental agreements. [65 ILCS 5/11-74.4-5 (d) (10)] If yes, please enclose list only of the intergovernmental agreements labeled Attachment M x * Types include: Central Business District, Retail, Other Commercial, Industrial, Residential, and Combination/Mixed. US Rte 34 & IL Rte 47 - Countryside Commercial Under which section of the Illinois Municipal Code was Redevelopment Project Area designated? (check one): Tax Increment Allocation Redevelopment Act __x___ Industrial Jobs Recovery Law _____ 5 FY 2014 Fund Balance at Beginning of Reporting Period 1,572,335$ Revenue/Cash Receipts Deposited in Fund During Reporting FY:Reporting Year Cumulative* % of Total Property Tax Increment -$ 33,219$ 1% State Sales Tax Increment 0% Local Sales Tax Increment 0% State Utility Tax Increment 0% Local Utility Tax Increment 0% Interest 107$ 395,185$ 8% Land/Building Sale Proceeds 0% Bond Proceeds -$ 3,506,099$ 68% Transfers from Municipal Sources 0% Private Sources 0% Bond Refunding Issuance 1,235,000$ 1,235,000$ 24% Total Amount Deposited in Special Tax Allocation Fund During Reporting Period 1,235,107$ Cumulative Total Revenues/Cash Receipts 5,169,503$ 100% Total Expenditures/Cash Disbursements (Carried forward from Section 3.2)3,341,529$ Distribution of Surplus Total Expenditures/Disbursements 3,341,529$ NET INCOME/CASH RECEIPTS OVER/(UNDER) CASH DISBURSEMENTS (2,106,422)$ FUND BALANCE, END OF REPORTING PERIOD*(534,087)$ * if there is a positive fund balance at the end of the reporting period, you must complete Section 3.3 SURPLUS*/(DEFICIT)(Carried forward from Section 3.3)(4,670,066)$ SECTION 3.1 - (65 ILCS 5/11-74.4-5 (d) (5) and 65 ILCS 5/11-74.6-22 (d) (5)) Provide an analysis of the special tax allocation fund. *must be completed where 'Reporting Year' is populated TIF NAME: US Rte 34 & IL Rte 47 - Countryside 6 FY 2014 Amounts Reporting Fiscal Year 1. Costs of studies, administration and professional services—Subsections (q)(1) and (o) (1) Legal Services 2,917 Auditing Services - TIF Compliance Report 250 Reporting Services - Bond Refunding Public Hearing 120 Printing Services 121 Paying Agent Fees 375 JRB Packet Postage 8 3,791$ 2. Cost of marketing sites—Subsections (q)(1.6) and (o)(1.6) -$ -$ -$ -$ -$ SECTION 3.2 A- (65 ILCS 5/11-74.4-5 (d) (5) and 65 ILCS 5/11-74.6-22 (d) (5)) Category of Permissible Redevelopment Cost [65 ILCS 5/11-74.4-3 (q) and 65 ILCS 5/11-74.6- 10 (o)] FOR AMOUNTS >$10,000 SECTION 3.2 B MUST BE COMPLETED ITEMIZED LIST OF ALL EXPENDITURES FROM THE SPECIAL TAX ALLOCATION FUND (by category of permissible redevelopment cost, amounts expended during reporting period) TIF NAME: US Rte 34 & IL Rte 47 - Countryside 3.Propertyassembly,demolition,site preparationandenvironmental site improvement costs. Subsection (q)(2), (o)(2) and (o)(3) 4.Costsofrehabilitation,reconstruction,repairorremodelingofexistingpublicorprivatebuildings. Subsection (q)(3) and (o)(4) 5. Costs of construction of public works and improvements. Subsection (q)(4) and (o)(5) 6.Costsofremovingcontaminantsrequiredbyenvironmental laws orrules (o)(6)-IndustrialJobs Recovery TIFs ONLY 7 -$ Refunding Bond Issuance Costs 37,315 Principal 185,000 Interest 117,738 Refund Bond Discount 9,773 Bond Refunding - Payment to Escrow Agent 1,187,912 1,537,738$ -$ -$ -$ -$ -$ 9. Approved capital costs. Subsection (q)(7) and (o)(9) 10.CostofReimbursingschool districts fortheirincreased costs causedby TIF assisted housing projects. Subsection (q)(7.5) - Tax Increment Allocation Redevelopment TIFs ONLY 11. Relocation costs. Subsection (q)(8) and (o)(10) 12. Payments in lieu of taxes. Subsection (q)(9) and (o)(11) 13.Costsofjobtraining,retrainingadvancedvocationalorcareereducationprovidedbyother taxing bodies. Subsection (q)(10) and (o)(12) 8. Financing costs. Subsection (q) (6) and (o)(8) 7.Costofjobtrainingandretraining,including"welfare to work"programsSubsection (q)(5),(o)(7) and (o)(12) PAGE 2 SECTION 3.2 A 8 Developer Incentive 1,800,000 1,800,000$ -$ -$ 3,341,529$ 15.Costsofconstructionofnewhousingunitsforlowincomeand very low-incomehouseholds. Subsection (q)(11)(F) - Tax Increment Allocation Redevelopment TIFs ONLY 16.Costofday care services andoperational costs ofday care centers.Subsection (q)(11.5)-Tax Increment Allocation Redevelopment TIFs ONLY TOTAL ITEMIZED EXPENDITURES 14.Costsofreimbursingprivatedevelopersforinterestexpensesincurredonapproved redevelopment projects. Subsection (q)(11)(A-E) and (o)(13)(A-E) SECTION 3.2 A PAGE 3 9 FY 2014 ______ There were no vendors, including other municipal funds, paid in excess of $10,000 during the current reporting period. Name Service Amount The Bank of New York Paying Agent 303,112$ James Ratos Developer Incentive 1,800,000$ List all vendors, including other municipal funds, that were paid in excess of $10,000 during the current reporting year. Section 3.2 B TIF NAME: US Rte 34 & IL Rte 47 - Countryside 10 FY 2014 FUND BALANCE, END OF REPORTING PERIOD (534,087)$ Amount of Original Issuance Amount Designated 1. Description of Debt Obligations General Obligation Bonds Series 2005 3,525,000$ 2,189,897$ General Obligation Refunding Bonds Series 2014 1,235,000$ 1,946,082$ Total Amount Designated for Obligations 4,760,000$ 4,135,979$ 2. Description of Project Costs to be Paid Total Amount Designated for Project Costs -$ TOTAL AMOUNT DESIGNATED 4,135,979$ SURPLUS*/(DEFICIT)(4,670,066)$ * NOTE: If a surplus is calculated, the municipality may be required to repay the amount to overlapping taxing SECTION 3.3 - (65 ILCS 5/11-74.4-5 (d) (5) 65 ILCS 11-74.6-22 (d) (5)) Breakdown of the Balance in the Special Tax Allocation Fund At the End of the Reporting Period TIF NAME: US Rte 34 & IL Rte 47 - Countryside 11 FY 2014 __X___ No property was acquired by the Municipality Within the Redevelopment Project Area Property Acquired by the Municipality Within the Redevelopment Project Area Property (1): Street address: Approximate size or description of property: Purchase price: Seller of property: Property (2): Street address: Approximate size or description of property: Purchase price: Seller of property: Property (3): Street address: Approximate size or description of property: Purchase price: Seller of property: Property (4): Street address: Approximate size or description of property: Purchase price: Seller of property: Providea descriptionofallpropertypurchasedbythemunicipalityduringthereporting fiscal year within the redevelopment project area. SECTION 4 [65 ILCS 5/11-74.4-5 (d) (6) and 65 ILCS 5/11-74.6-22 (d) (6)] TIF NAME: US Rte 24 & IL Rte 47 - Countryside 12 FY 2014 ______ ___1___ TOTAL:11/1/99 to Date Estimated Investment for Subsequent Fiscal Year Total Estimated to Complete Project Private Investment Undertaken (See Instructions)8,500,000$ -$ 8,500,000$ Public Investment Undertaken 1,811,065$ 50,000$ 2,000,000$ Ratio of Private/Public Investment 4 52/75 4 1/4 Project 1: *IF PROJECTS ARE LISTED NUMBER MUST BE ENTERED ABOVE Kendall Crossing Private Investment Undertaken (See Instructions)8,500,000$ 8,500,000$ Public Investment Undertaken 1,811,065$ 50,000$ 2,000,000$ Ratio of Private/Public Investment 4 52/75 4 1/4 Project 2: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 3: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 4: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 5: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 6: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 SECTION 5 - 65 ILCS 5/11-74.4-5 (d) (7) (G) and 65 ILCS 5/11-74.6-22 (d) (7) (G) PAGE 1 SECTION 5 PROVIDES PAGES 1-3 TO ACCOMMODATE UP TO 25 PROJECTS. PAGE 1 MUST BE INCLUDED WITH TIF REPORT. PAGES 2-3 SHOULD BE INCLUDED ONLY IF PROJECTS ARE LISTED ON THESE PAGES ENTER total number of projects undertaken by the Municipality Within the Redevelopment Project Area and list them in detail below*. Check here if NO projects were undertaken by the Municipality Within the Redevelopment Project Area: TIF NAME: US Rte 34 & IL Rte 47 - Countryside 13 Project 7: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 8: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 9: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 10: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 11: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 12: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 13: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 14: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 15: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 PAGE 2 14 Project 16: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 17: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 18: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 19: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 20: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 21: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 22: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 23: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 24: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 25: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 PAGE 3 15 SECTION 6 FY 2014 Provide the base EAV (at the time of designation) and the EAV for the year reported for the redevelopment project area Year redevelopment project area was designated Base EAV Reporting Fiscal Year EAV 2/15/2005 1,528,166$ 1,393,239$ SECTION 7 Provide information about job creation and retention Number of Jobs Retained Number of Jobs Created Description and Type (Temporary or Permanent) of Jobs Total Salaries Paid -$ -$ -$ -$ -$ -$ -$ SECTION 8 Provide a general description of the redevelopment project area using only major boundaries: Optional Documents Enclosed Legal description of redevelopment project area previously provided Map of District previously provided Optional:Information in the following sections is not required by law,butwouldbehelpful in evaluating the performance of TIF in Illinois. *even though optional MUST be included as part of complete TIF report List all overlapping tax districts in the redevelopment project area. If overlapping taxing district received a surplus, list the surplus. __X___ The overlapping taxing districts did not receive a surplus. Overlapping Taxing District Surplus Distributed from redevelopment project area to overlapping districts TIF NAME: US Rte 34 & IL Rte 47 - Countryside -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ 16 17 18 Unit Code 047/035/30 Attachment D Activities Statement US Rte 34 & IL Rte 47 Countryside In November of 2013 a new 30,000 square foot multiplex movie theater, called NCG Cinemas, opened within the Countryside TIF district. Pursuant to the development agreement, the developer of the movie theater will receive TIF incentives totaling $2 million. Of this amount, $1.8 million was paid (from remaining 2005 bond proceeds) upon the opening of the new theater. The remaining $200,000 will be paid from amusement tax receipts. In addition, the developer will also receive a 50% rebate of amusement tax receipts for a period of ten years. This development, known as Kendall Crossing, also contains six additional outlots allowing for potential commercial development in the future. In January of 2014 the City completed a partial refunding of the 2005 Countryside bonds, in order to mitigate the fund’s negative equity position and ease cash flow constraints in subsequent fiscal years. As of April 30, 2014, outstanding principal for the 2005 and 2014 bonds was $1.6 million and $1.235 million, respectively. During the current fiscal year the TIF district paid $302,738 in debt service costs, consisting of principal and interest in the amounts of $185,000 and $117,738, respectively. 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 New Issue Investment Rating: Standard & Poor’s … AA- (Stable Outlook) Final Official Statement Dated December 10, 2013 Subject to compliance by the City with certain covenants, in the opinion of Bond Counsel, under present law, interest on the Bonds is excludable from gross income of the owners thereof for federal income tax purposes and is not included as an item of tax preference in computing the federal alternative minimum tax for individuals and corporations, but such interest is taken into account in computing an adjustment used in determining the federal alternative minimum tax for certain corporations. Interest on the Bonds is not exempt from present State of Illinois income taxes. See “TAX MATTERS” herein for a more complete discussion. The Bonds are “qualified tax-exempt obligations” under Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. See “QUALIFIED TAX-EXEMPT OBLIGATIONS” herein. $1,235,000 UNITED CITY OF YORKVILLE Kendall County, Illinois General Obligation (Alternate Revenue Source) Refunding Bonds, Series 2014 Dated Date of Delivery Bank Qualified Book-Entry Due Serially December 1, 2025-2029 The $1,235,000 General Obligation (Alternate Revenue Source) Refunding Bonds, Series 2014 (the “Bonds”), are being issued by the United City of Yorkville, Kendall County, Illinois (the “City”). Interest on the Bonds is payable semiannually on June 1 and December 1 of each year, commencing June 1, 2014. The Bonds will be issued using a book-entry system. The Depository Trust Company (“DTC”), New York, New York, will act as securities depository for the Bonds. The ownership of one fully registered Bond for each maturity will be registered in the name of Cede & Co., as nominee for DTC and no physical delivery of Bonds will be made to purchasers. The Bonds will mature on December 1, in the following years and amounts. Interest is calculated based on a 360-day year of twelve 30-day months. AMOUNTS, MATURITIES, INTEREST RATES, PRICES OR YIELDS AND CUSIP NUMBERS Principal Due Interest Yield or CUSIP Principal Due Interest Yield or CUSIP Amount Dec. 1 Rate Price Number Amount Dec. 1 Rate Price Number $230,000 ..... 2025 4.000% 3.800% 987355 HW7 $255,000 ...... 2028 4.150% 4.150% 987355 HZ0 235,000 ..... 2026 4.000% 3.900% 987355 HX5 270,000 ...... 2029 4.300% 4.300% 987355 JA3 245,000 ..... 2027 4.050% 4.050% 987355 HY3 OPTIONAL REDEMPTION The Bonds are callable in whole or in part on any date on or after December 1, 2023, at a price of par and accrued interest. If less than all the Bonds are called, they shall be redeemed in such principal amounts and from such maturities as determined by the City and within any maturity by lot. See “OPTIONAL REDEMPTION” herein. PURPOSE, LEGALITY AND SECURITY Bond proceeds will be used to defease a portion of and to advance refund a portion of the City’s outstanding General Obligation Bonds (Alternate Revenue Source), Series 2005 (the “Series 2005 Bonds”), to pay capitalized interest through June 1, 2015, and to pay the costs of issuance of the Bonds. See “PLAN OF FINANCING” herein. In the opinion of Shanahan & Shanahan LLP, Chicago, Illinois, Bond Counsel, the Bonds will constitute valid and legally binding obligations of the City payable as to principal and interest ratably and equally with the City’s outstanding Series 2005 Bonds not being refunded by the Bonds from (a) (i) the sales taxes received by the City pursuant to the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailer’s Occupation Tax Act, each as supplemented and amended from time to time by the General Assembly of the State of Illinois, and (ii) certain incremental property taxes to be derived from the Project Area and to be received by the City, and (b) ad valorem taxes levied against all taxable property within the City without limitation as to rate or amount, except that the rights of the owners of the Bonds and the enforceability of the Bonds may be limited by bankruptcy, insolvency, moratorium, reorganization and other similar laws affecting creditors’ rights and by equitable principles, whether considered at law or in equity, including the exercise of judicial discretion. See “DESCRIPTION OF THE BONDS” herein The Bonds are offered when, as and if issued and received by the Underwriter, subject to the approving legal opinion of Shanahan & Shanahan LLP, Chicago, Illinois, Bond Counsel, and certain other conditions. Certain legal matters will be passed upon for the Underwriter by Miller, Canfield, Paddock and Stone, P.L.C., Chicago, Illinois. It is expected that the Bonds will be made available for delivery on or about January 6, 2014. 49 The Underwriter has provided the following sentence for inclusion in the Final Official Statement. The Underwriter has reviewed the information in this Final Official Statement in accordance with, and as part of, its respective responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information. This Final Official Statement does not constitute an offer to sell or the solicitation of an offer to buy any securities other than those described on the cover page hereof, nor shall there be any offer to sell, solicitation of an offer to buy or sale of, the Bonds in any jurisdiction in which it is unlawful to make such offer, solicitation or sale. No dealer, broker, salesman or other person has been authorized by the City to give any information or to make any representations with respect to the Bonds other than as contained in the Official Statement or the Final Official Statement and, if given or made, such other information or representations must not be relied upon as having been authorized by the City. Certain information contained in the Official Statement and the Final Official Statement may have been obtained from sources other than records of the City and, while believed to be reliable, is not guaranteed as to completeness. THE INFORMATION AND EXPRESSIONS OF OPINION IN THE OFFICIAL STATEMENT AND THE FINAL OFFICIAL STATEMENT ARE SUBJECT TO CHANGE, AND NEITHER THE DELIVERY OF THE OFFICIAL STATEMENT OR THE FINAL OFFICIAL STATEMENT NOR ANY SALE MADE UNDER EITHER SUCH DOCUMENT SHALL CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE CITY SINCE THE RESPECTIVE DATES THEREOF. References herein to laws, rules, regulations, ordinances, resolutions, agreements, reports and other documents do not purport to be comprehensive or definitive. All references to such documents are qualified in their entirety by reference to the particular document, the full text of which may contain qualifications of and exceptions to statements made herein. Where full texts have not been included as appendices to the Official Statement or the Final Official Statement they will be furnished on request. This Final Official Statement does not constitute an offer to sell, or solicitation of an offer to buy, any securities to any person in any jurisdiction where such offer or solicitation of such offer would be unlawful. 50 TABLE OF CONTENTS BOND ISSUE SUMMARY ............................................................................................................................ 5 UNITED CITY OF YORKVILLE .................................................................................................................... 6 DESCRIPTION OF THE BONDS .................................................................................................................... 6 Security: Alternate Revenue Sources and Tax Levy ........................................................................................... 6 Highlights of Alternate Bonds ...................................................................................................................... 7 Refunding Alternate Bonds .......................................................................................................................... 7 Abatement of Pledged Taxes ........................................................................................................................ 7 Bond Funds ............................................................................................................................................ 8 Certain Risk Factors ................................................................................................................................. 8 THE CITY ................................................................................................................................................ 8 City Government and Services ..................................................................................................................... 8 Transportation ......................................................................................................................................... 8 Commerce and Industry ............................................................................................................................. 9 Community Life ...................................................................................................................................... 9 Education .............................................................................................................................................. 9 SOCIOECONOMIC INFORMATION .............................................................................................................. 10 Housing ............................................................................................................................................... 12 Income ................................................................................................................................................. 12 Retail Activity ........................................................................................................................................ 14 PLAN OF FINANCING ............................................................................................................................... 15 DEBT INFORMATION ............................................................................................................................... 16 PROPERTY ASSESSMENT AND TAX INFORMATION ..................................................................................... 20 REAL PROPERTY ASSESSMENT, TAX LEVY AND COLLECTION PROCEDURES ................................................ 21 Tax Levy and Collection Procedures ............................................................................................................. 21 Exemptions ........................................................................................................................................... 22 Property Tax Extension Limitation law .......................................................................................................... 23 Truth in Taxation Law .............................................................................................................................. 24 FINANCIAL INFORMATION ....................................................................................................................... 24 Financial Reports .................................................................................................................................... 24 No Consent or Updated Information Requested of the Auditor .............................................................................. 24 Summary Financial Information ................................................................................................................... 24 EMPLOYEE RETIREMENT AND OTHER POSTEMPLOYMENT BENEFITS OBLIGATIONS ..................................... 30 Plan Descriptions, Provisions and Funding Policies ........................................................................................... 30 Illinois Municipal Retirement System ............................................................................................................ 30 Funding Progress .................................................................................................................................... 31 Employer Contributions ............................................................................................................................ 31 Police Pension Plan.................................................................................................................................. 31 Funding Progress .................................................................................................................................... 32 Employer Contributions ............................................................................................................................ 33 Summary of Significant Accounting Policies and Plan Asset Matters ....................................................................... 33 Basis of Accounting ................................................................................................................................. 33 Method Used to Value Investments ............................................................................................................... 33 Significant Investments ............................................................................................................................. 33 Related Party Transactions ......................................................................................................................... 33 Annual Pension Cost and Net Pension Obligation .............................................................................................. 33 Trend Information ................................................................................................................................... 34 Funded Status and Funding Progress ............................................................................................................. 35 Plan Descriptions, Provisions, and Funding Policies .......................................................................................... 35 Annual OPEB Costs and Net OPEB Obligation ................................................................................................ 36 Trend Information ................................................................................................................................... 36 Funded Status and Funding Progress ............................................................................................................. 36 Actuarial Methods and Assumptions .............................................................................................................. 36 Funding Progress .................................................................................................................................... 37 Employer Contributions ............................................................................................................................ 37 51 REGISTRATION, TRANSFER AND EXCHANGE ............................................................................................. 37 TAX MATTERS ........................................................................................................................................ 38 Original Issue Discount ............................................................................................................................. 40 Premium .............................................................................................................................................. 40 QUALIFIED TAX-EXEMPT OBLIGATIONS .................................................................................................... 40 CONTINUING DISCLOSURE ....................................................................................................................... 41 THE UNDERTAKING ................................................................................................................................ 41 Annual Financial Information Disclosure ........................................................................................................ 41 Reportable Events Disclosure ...................................................................................................................... 42 Consequences of Failure of the City to Provide Information ................................................................................. 43 Amendment; Waiver ................................................................................................................................ 43 Termination of Undertaking ....................................................................................................................... 43 Additional Information .............................................................................................................................. 43 Dissemination of Information; Dissemination Agent ........................................................................................... 44 OPTIONAL REDEMPTION ......................................................................................................................... 44 LITIGATION ............................................................................................................................................ 44 FINAL OFFICIAL STATEMENT AUTHORIZATION ......................................................................................... 44 INVESTMENT RATING ............................................................................................................................. 45 CERTAIN LEGAL MATTERS ...................................................................................................................... 45 DEFEASANCE ......................................................................................................................................... 45 UNDERWRITING ..................................................................................................................................... 45 FINANCIAL ADVISOR .............................................................................................................................. 46 CERTIFICATION ...................................................................................................................................... 46 APPENDIX A - EXCERPTS OF FISCAL YEAR 2013 AUDITED FINANCIAL STATEMENTS APPENDIX B - DESCRIBING BOOK-ENTRY-ONLY ISSUANCE APPENDIX C - PROPOSED FORM OF OPINION OF BOND COUNSEL APPENDIX D - EXCERPTS OF FISCAL YEAR 2013 AUDITED FINANCIAL STATEMENTS RELATING TO THE VILLAGE’S PENSION PLANS AND OTHER POSTEMPLOYMENT BENEFITS 52 BOND ISSUE SUMMARY This Bond Issue Summary is expressly qualified by the entire Final Official Statement, which is provided for the convenience of potential investors and which should be reviewed in its entirety by potential investors. Issuer: United City of Yorkville, Kendall County, Illinois (the “City”). Issue: $1,235,000 General Obligation (Alternate Revenue Source) Refunding Bonds, Series 2014. Dated Date: Date of delivery (expected to be on or about January 6, 2014). Interest Due: Each June 1 and December 1, commencing June 1, 2014. Principal Due: Serially each December 1, commencing December 1, 2025 through 2029, as detailed on the front page of this Final Official Statement. Optional Redemption: The Bonds are callable at the option of the City on any date on or after December 1, 2023, at a price of par plus accrued interest. See “OPTIONAL REDEMPTION” herein. Authorization: By vote of the City Council and pursuant to the provisions of the Illinois Municipal Code (the “Municipal Code”) and the Local Government Debt Reform Act (the “Debt Reform Act”) of the State of Illinois. Security: The Bonds are payable both as to principal and interest ratably and equally with the City’s outstanding Series 2005 Bonds not being refunded by the Bonds from (a) (i) the sales taxes received by the City pursuant to the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailer’s Occupation Tax Act, each as supplemented and amended from time to time by the General Assembly of the State of Illinois (the “Sales Taxes”), and (ii) certain incremental property taxes to be derived from the US Route 34 & IL Route 47 (Countryside Shopping Center) Tax Increment Financing Redevelopment Project Area within the City (the “Project Area”) and to be received by the City (the “Incremental Property Taxes), and (b) ad valorem taxes levied against all taxable property within the City without limitation as to rate or amount. See “DESCRIPTION OF THE BONDS” herein Credit Rating: The City’s outstanding general obligation rating is “AA-” (Stable Outlook) from Standard & Poor’s, a Division of the McGraw-Hill Companies, New York, New York. See “INVESTMENT RATING” herein. Purpose: Bond proceeds will be used to defease a portion of and to advance refund a portion of the City’s outstanding General Obligation Bonds (Alternate Revenue Source), Series 2005 (the “Series 2005 Bonds”), to pay capitalized interest through June 1, 2015, and to pay the costs of issuance of the Bonds. See “PLAN OF FINANCING” herein. Tax Exemption: Shanahan & Shanahan LLP, Chicago, Illinois, will provide an opinion as to the tax exemption of the Bonds as discussed under “TAX MATTERS” in this Final Official Statement. Interest on the Bonds is not exempt from present State of Illinois income taxes. Bank Qualified: The Bonds are “qualified tax-exempt obligations” under Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. See “QUALIFIED TAX-EXEMPT OBLIGATIONS” herein. Bond Registrar/Paying Agent Escrow Agent/Tax Escrow: The Bank of New York Mellon Trust Company, N.A., Chicago, Illinois. Verification Agent: Stanley P. Stone & Associates, Inc., New York, New York. Book-Entry Form: The Bonds will be registered in the name of Cede & Co. as nominee for The Depository Trust Company (“DTC”), New York, New York. DTC will act as securities depository of the Bonds. See APPENDIX B herein. Delivery: The Bonds are expected to be delivered on or about January 6, 2014. Denomination: $5,000 or integral multiples thereof. Financial Advisor: Speer Financial, Inc., Chicago, Illinois. Underwriter: Bernardi Securities, Inc., Chicago, Illinois. 53 UNITED CITY OF YORKVILLE Kendall County, Illinois Gary J. Golinski Mayor Aldermen Carlo Colosimo Ken Koch Jacquelyn Milschewski Joel Frieders Larry Kot Rose Ann Spears Chris Funkhouser Diane Teeling _________________________________ Officials Beth Warren City Clerk Bart Olson City Administrator Eric Dhuse Director of Public Works Rob Fredrickson Finance Director/Deputy Treasurer Kathleen Field Orr, Esq. City Attorney DESCRIPTION OF THE BONDS Security: Alternate Revenue Sources and Tax Levy The Bonds are payable both as to principal and interest ratably and equally with the City’s outstanding Series 2005 Bonds not being refunded by the Bonds from (a) (i) the Sales Taxes and the Incremental Property Taxes (the “Pledged Revenues”), and (b) ad valorem taxes levied against all of the taxable property within the City without limitation as to rate or amount (the “Pledged Taxes”). Pursuant to the Debt Reform Act, the City will pledge such monies to the payment of Bonds and shall covenant to provide for and apply such Pledged Revenues to the payment of Bonds and the provision of not less than an additional 0.25 times debt service, which pledge and covenant shall constitute a continuing obligation of the City and continuing appropriation of the amounts received. For the prompt payment of the Bonds, the full faith, credit and resources of the City are irrevocably pledged. In the ordinance authorizing the Bonds (the “Bond Ordinance”), the City covenants and agrees with the purchasers and the owners of the Bonds that so long as any of the Bonds remain outstanding, the City will take no action or fail to take any action which in any way would adversely affect the ability of the City to collect the Pledged Revenues or, except for abatement of tax levies as permitted in the Bond Ordinance, to levy and collect the Pledged Taxes. The City and its officers will comply with all present and future applicable laws in order to assure that the Pledged Revenues will be available and that the Pledged Taxes will be levied, extended and collected as provided in the Bond Ordinance and deposited in the Bond Fund. As provided in the Debt Reform Act, the City’s determination of the sufficiency of the Pledged Revenues will be based on the City’s audited financial statements for its fiscal year ended April 30, 2013, or on reports of the State of Illinois. 54 Highlights of Alternate Bonds Section 15 of the Debt Reform Act provides that whenever revenue bonds have been duly authorized, a local government unit may issue its general obligation bonds in lieu of such revenue bonds as authorized, and such general obligation bonds may be referred to as “alternate bonds.” The Debt Reform Act also provides that whenever there exists an alternate revenue source, a local government unit may issue alternate bonds. Such bonds are general obligation debt payable from the pledged alternate revenues with the general obligation of the issuer acting as back-up security. The Debt Reform Act prescribes several conditions that must be met before alternate bonds may be issued. First, alternate bonds must be issued for a lawful corporate purpose. If issued in lieu of revenue bonds, the alternate bonds must be authorized under applicable law. Alternate bonds may be issued payable from either enterprise revenues or other revenue sources, or both. Second, the question of issuance must be submitted to referendum if, within thirty (30) days after publication of an authorizing ordinance and notice of intent to issue alternate bonds, a petition signed by the greater of (i) 7.5% of the registered voters in the government unit; or (ii) 200 of those registered voters or 15%, whichever is less, is filed. No legally sufficient petition has been filed in connection with the Bonds, and accordingly the City is now authorized to issue the Bonds. Third, the issuer must determine that the pledged revenue source or sources are sufficient in each year to final maturity to provide not less than 1.25 times debt service of the proposed alternate bonds and all other outstanding alternate bonds of the issuer payable from the same revenue source. To the extent payable from enterprise revenues, such revenues shall have been determined by the governing body to be sufficient to provide for or pay in each year to final maturity of such alternate bonds all of the following: (1) costs of operation and maintenance of the utility or enterprise, but not including depreciation, (2) debt service on all outstanding revenue bonds payable from such enterprise revenues, (3) all amounts required to meet any fund or account requirements with respect to such outstanding revenue bonds, (4) other contractual or tort liability obligations, if any, payable from such enterprise revenues, and (5) in each year, an amount not less than 1.25 times debt service of all (i) alternate bonds payable from such enterprise revenues previously issued and outstanding and (ii) alternate bonds proposed to be issued. To the extent payable from one or more revenue sources, such sources shall have been determined by the governing body to provide in each year an amount not less than 1.25 times debt service on all alternate bonds payable from such revenue sources previously issued and outstanding and the alternate bonds proposed to be issued. The issuer must in fact pledge and covenant to provide for, collect and apply the pledged alternate enterprise revenues or revenue source(s). Refunding Alternate Bonds Section 15 of the Debt Reform Act, provides that alternate bonds may be issued to refund or advance refund alternate bonds without meeting any of the conditions set forth in such section, as would have applied to the Prior Bonds (see “Highlights of Alternate Bonds” above), if the term of the refunding bonds is no longer than the term of the refunded bonds and the debt service payable on the refunding bonds in each year is no more than the debt service payable in such year on the refunded bonds. Abatement of Pledged Taxes Whenever funds are available to pay any principal of or interest on the Bonds when due, the City will direct the deposit of such funds into the Bond Fund created solely for such purpose. The City covenants in the Bond Ordinance, as supplemented by Bond Order, to deposit monthly into the appropriate Bond Fund an amount equal to one-sixth (1/6) of the next scheduled interest payment and one-twelfth (1/12) of the next scheduled principal payment. The City pledges to abate the levy for the Bonds only upon full funding of the Bond Fund in the appropriate levy amount. 55 Bond Funds The City will deposit the appropriate Pledged Revenues and the Pledged Taxes into a separate Bond Fund, which is a trust fund established for the purpose of carrying out the covenants, terms and conditions imposed upon the City by the Bond Ordinance. The Bonds are secured by a pledge of all of the monies on deposit in the Bond Fund, and such pledge is irrevocable until the Bonds have been paid in full or until the obligations of the City are discharged under the Bond Ordinance. Certain Risk Factors The ability of the City to pay the Bonds from the Pledged Revenues may be limited by circumstances beyond the control of the City. There is no guarantee that the Pledged Revenues will continue to be available at current levels. To the extent that Pledged Revenues may be insufficient to pay the Bonds, the Bonds are to be paid from the Pledged Taxes. If the Pledged Taxes are ever extended for the payment of the Bonds, the amount of the Bonds then outstanding will be included in the computation of indebtedness of the City for purposes of all statutory provisions or limitations until such time as an audit of the City shows that the Bonds have been paid from the Pledged Revenues for a complete fiscal year. THE CITY The site where the United City of Yorkville (the “City”) is located was first settled in 1833; the City was officially incorporated as a Village on July 8, 1874. On April 16, 1957, the City and the Village of Bristol joined together to form one municipality known as the United City of Yorkville. The City has been the county seat of Kendall County since 1859. It is located in northeastern Illinois on the Fox River approximately 45 miles southwest of Chicago. Nearby communities include Oswego, Bristol, Plano, Millbrook, Helmar, Newark, Plattville, Montgomery, Sugar Grove and Plainfield. According to the 2000 Census, the City had a population of 6,189. A special census in December of 2003 resulted in a population total of more than 8,500; a special census completed in May of 2006 showed an increase in that total of 31.8% when the population increased to 11,204. The special census in 2008 recorded a population of 16,838 which increased to 16,921 at the 2010 Census. City Government and Services The City follows a Mayor/City Council form of government in which the Mayor, Aldermen, City Clerk and City Treasurer are each elected to a four-year term. The City Council is comprised of the Mayor and eight Aldermen (two Aldermen elected from each of the City’s four wards). The City is served by the Bristol/Kendall Fire Protection District which carries a Protection Class 6. It maintains a 24 hour paramedics unit and is a member of the Mutual Aid Box Alarm System. The Police Department employs 26 full-time officers and 5 part-time officers, and emergency medical service is available 24 hours a day. Transportation The City is approximately 15 miles west of Interstate 55 (I-55); almost 20 miles north of Interstate 80 (I-80); and nearly 12 miles south of Interstate 88 (I-88). Illinois Route 47 and U.S. Route 34 intersect the City. O’Hare International Airport is approximately 50 miles northeast of the City and Midway Airport is about 45 miles to the east in Chicago. Aurora Municipal Airport, approximately ten miles to the north provides lighted runways and aircraft tiedowns, hangar, power plant repair, air frame repair and navigator aids. Additionally it offers freight, charter and helicopter services. The Burlington Northern Sante Fe Railroad in nearby Aurora provides commuter rail service. 56 Commerce and Industry Businesses and retailers are attracted to the City because of its location near several major thoroughfares and the Fox River. The City features several shopping centers including Kendall Marketplace and the historic downtown area as well as the retail establishments found on both the north and south ends of the City. There are two tax increment finance (TIF) districts in the City referred to as the Countryside TIF and the Downtown TIF. Major private employers are found in a variety of fields including entertainment, retail, services and light industry. Some of the larger employers are the Raging Waves Water Park (450 employees), Wrigley Manufacturing Company LLC (335 employees), Super Target (180 employees), Menards Mega Store (140 employees), and Jewel/Osco and Newlyweds Foods (each with 130 employees). Community Life The City contains approximately 60 acres of parks with picnic areas, a gazebo and recreational fields. Programs offered include aerobics, basketball, bus trips, bowling, crafts, dance, fishing, golf, soccer, sports club, street hockey, tee ball, tennis and tumbling. Residents also enjoy a golf course and forest preserves which are nearby but outside the City boundaries. Raging Waves, the largest outdoor water park in Illinois, opened in 2009. Among its attractions are the Kangaroo Falls play structure with ladders and water spouts, the Cyclone Bowl and Boomerang Tornado rides as well as the Great Barrier Reef wave that imitates the action of the ocean. Yorkville Public Library (the “Library”) serves the residents of the City and is a member of the Heritage Trail Library System. In addition to its extensive collection of books, Library resources include dial-a-story, local history, newspapers, sheet music, audio books, large print books, paperbacks, magazines, and videos and DVDs. Services available to the community are homebound service, interlibrary loan, kits for brothers and sisters of new babies, kits for sick kids, loft meeting area, photocopier, computers, tax forms, talking books, typewriter and voter registration. The Library offers the following online resources: animals and the environment; arts and crafts; children’s book and screen characters; children’s books and stories online; educational resources; exploration and museums; history and geography; holidays and celebrations; literature online; math and science; music and poetry; reference tools and homework help; space; and sports and recreation. The Library recently completed a $8.75 million expansion program. Medical services are available at Rush/Copley Medical Center in the City and also at the Rush/Copley Medicine Center and Provena-Mercy Center, both located in Aurora. Additional facilities are provided by Sandwich Community Hospital in Sandwich, Illinois. These institutions are about fifteen miles from the City. Education Community Unit School District Number 115 (the “District”) meets the elementary and secondary educational requirements of the City with two elementary schools, one junior high school and one high school. The District has a staff of approximately 425 teachers and administrators and approximately 5,500 students. The District has implemented a new computer curriculum, innovative interdisciplinary projects and advanced team building and support programs for students and staff. Higher education opportunities are offered by Aurora University in nearby Aurora and Northern Illinois University in DeKalb. In addition, Waubonsee Community College District No. 516 (the “College”) offers a wide variety of transfer, vocational, continuing and community education, children’s and corporate development and training classes. It has 24 programs designed for transfer to senior institutions, and also offers occupational-oriented programs ranging in length from one semester to two years. The College recently opened a state-of-the-art academic computing center that houses eight classrooms and a 120 personal computer work station open lab. 57 SOCIOECONOMIC INFORMATION Following are lists of large employers located in the City and in the surrounding area. Major City Employers(1) Approximate Name Product/Service Employment Raging Waves Water Park ...................................... Water Park .............................................. 450 Community Unit School District Number 115 .................... Education ............................................... 425 Kendall County ............................................... County Government ....................................... 345 Wrigley Manufacturing Co., LLC ............................... Sugar Confections, Bubble Gum, and Candy ................. 335 Super Target ................................................. Retail Store ............................................ 180 Menards Mega Store ........................................... Home Improvement Store .................................. 140 United City of Yorkville ..................................... City Government ......................................... 140 Jewel/Osco ................................................... Grocery Store ........................................... 130 Newlyweds Foods .............................................. Food Seasonings, Cures and Binders ....................... 130 Kohl's ....................................................... Retail Store ............................................ 115 United States Postal Service ................................. Postal Service .......................................... 100 Boombah, Inc. ................................................ Sports Equipment and Apparel ............................ 90 Hillside Health Care Center .................................. Healthcare .............................................. 90 Home Depot ................................................... Home Improvement Store .................................. 85 Wheatland Title Guaranty Co. ................................. Title Insurance ......................................... 65 Marshalls .................................................... Retail Store ............................................ 50 Brenart Eye Clinic ........................................... Eyeglasses .............................................. 45 Rush-Copley Medical Center ................................... Medical Center .......................................... 45 Maciano's Pizza & Pastaria ................................... Restaurant .............................................. 40 Panera Bread ................................................. Restaurant and Bakery ................................... 40 Note: (1) Source: 2013 Illinois Manufacturers Directory, 2013 Illinois Services Directory, Yorkville Economic Development Corporation and a selective telephone survey. Major Area Employers(1) Approximate Location Name Business or Product Employment Greater Fox Valley Area ... Rush-Copley Medical Center(2) ................. Medical Center ............................... 2,000 Sugar Grove ............... Waubonsee Community College #516 .............. Education .................................... 1,460 Morris .................... Exelon Nuclear, Dresden Generating Station .... Electric Service ............................. 900 Montgomery ................ Eby-Brown Co. ................................ Wholesale Tobacco and Confectionery ........... 400 Montgomery ................ Lyons Workspace Products, LLC ................. Steel Storage Equipment ...................... 400 Morris .................... LyondellBassell Industries .................... Plastic Materials ............................ 400 Montgomery ................ V V F Illinois Services ....................... Soap and Detergents .......................... 350 Montgomery ................ Fox River Foods Inc. .......................... Wholesale Food ............................... 300 Morris .................... Northfield Block Co. .......................... Architectural Concrete Blocks ................ 300 Plainfield ................ CB&I, Inc. ................................... Storage Tank Insulation Equipment ............. 300 Plainfield ................ Diageo North American, Inc. ................... Gin and Vodka Distilling ..................... 300 Montgomery ................ Aurora Bearing Co. ............................ Ball and Roller Bearings ..................... 250 Oswego .................... Coldwell Banker Primus Realty ................. Residential Real Estate ...................... 225 Montgomery ................ Hormann Gadco LLC ............................. Doors, Sash and Trim Metal ................... 200 Plainfield ................ Plainfield Precision .......................... Custom Metal and Plastic Components ........... 200 Plano ..................... Midwest Mfg., Inc. ............................ Millwork ..................................... 200 Plainfield ................ Walsh Landscape............................... Landscape Construction and Maintenance ........ 185 Montgomery ................ Aurora Metals Div., L.L.C. .................... Copper Foundries ............................. 150 Montgomery ................ International Paper ........................... Corrugated Cartons ........................... 150 Oswego .................... Radiac Abrasives, Inc. ........................ Diamond Grinding Wheels ...................... 150 Plano ..................... Fox Valley Molding, Inc. ...................... Compression Transfer and Injection Molding .... 150 Notes: (1) Source: 2013 Illinois Manufacturers Directory, 2013 Illinois Services Directory and a selective telephone survey. (2) Includes the City. 58 The following tables show employment by industry and by occupation for the City, Kendall County (the “County”) and the State of Illinois as reported by the U.S. Census Bureau 2007-2011 American Community Survey 5- year estimated values. Employment By Industry(1) The City The County State of Illinois Classification Number Percent Number Percent Number Percent Agriculture, Forestry, Fishing and Hunting, and Mining ...... 20 0.2% 333 0.6% 63,960 1.1% Construction ............................................... 626 7.6% 3,912 7.0% 343,232 5.7% Manufacturing .............................................. 1,260 15.3% 7,522 13.5% 775,663 12.8% Wholesale Trade ............................................ 274 3.3% 1,805 3.2% 196,738 3.3% Retail Trade ............................................... 996 12.1% 6,633 11.9% 659,708 10.9% Transportation and Warehousing, and Utilities .............. 408 5.0% 3,555 6.4% 355,486 5.9% Information ................................................ 312 3.8% 1,405 2.5% 135,688 2.2% Finance and Insurance, and Real Estate and Rental and Leasing .................................... 508 6.2% 4,890 8.8% 466,468 7.7% Professional, Scientific, and Management, Administrative, and Waste Management Services ............................. 641 7.8% 5,874 10.5% 662,987 11.0% Educational Services and Health Care and Social Assistance .. 1,910 23.2% 11,398 20.4% 1,337,455 22.1% Arts, Entertainment and Recreation and Accommodation and Food Services ......................................... 502 6.1% 3,878 7.0% 524,925 8.7% Other Services, Except Public Administration ............... 316 3.8% 2,126 3.8% 288,538 4.8% Public Administration ...................................... 447 5.4% 2,467 4.4% 232,923 3.9% Total .................................................... 8,220 100.0% 55,798 100.0% 6,043,771 100.0% Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to 2011. Employment By Occupation(1) The City The County State of Illinois Classification Number Percent Number Percent Number Percent Management, Business, Science, and Art ..................... 3,393 41.3% 21,718 38.9% 2,167,571 35.9% Service .................................................... 1,274 15.5% 7,319 13.1% 1,007,434 16.7% Sales and Office ........................................... 1,947 23.7% 14,863 26.6% 1,550,202 25.6% Natural Resources, Construction, and Maintenance............ 740 9.0% 5,159 9.2% 474,566 7.9% Production, Transportation, and Material Moving ............ 866 10.5% 6,739 12.1% 843,998 14.0% Total .................................................... 8,220 100.0% 55,798 100.0% 6,043,771 100.0% Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to 2011. Annual Average Unemployment Rates(1) Calendar The The The Year City County State 2003 ............. 3.6% 6.0% 6.7% 2004 ............. 3.4% 5.0% 6.2% 2005 ............. 3.2% 5.2% 5.7% 2006 ............. 2.6% 4.0% 4.5% 2007 ............. 3.1% 4.5% 4.6% 2008 ............. 3.8% 5.8% 6.4% 2009 ............. 6.6% 9.9% 10.0% 2010 ............. 6.4% 9.8% 10.3% 2011 ............. 5.9% 8.7% 9.8% 2012 ............. 5.2% 7.8% 8.9% 2013(2) .......... N/A 7.9% 9.0% Notes: (1) Illinois Department of Employment Security. (2) Preliminary rates for the month of August 2013. 59 Housing The U.S. Census Bureau 5-year estimated values reported that the median value of the City’s owner-occupied homes was $248,200. This compares to $239,300 for the County and $198,500 for the State of Illinois. The following table represents the five year average market value of specified owner-occupied units for the City, the County and the State of Illinois at the time of the 2007-2011 American Community Survey. Specified Owner-Occupied Units(1) The City The County State of Illinois Value Number Percent Number Percent Number Percent Under $50,000 ..................... 68 1.5% 302 1.0% 218,208 6.7% $50,000 to $99,999 ................ 141 3.2% 789 2.5% 451,967 13.8% $100,000 to $149,999 .............. 396 8.8% 2,652 8.3% 464,158 14.2% $150,000 to $199,999 .............. 654 14.6% 6,873 21.6% 518,957 15.8% $200,000 to $299,999 .............. 1,909 42.6% 12,198 38.4% 725,004 22.1% $300,000 to $499,999 .............. 1,099 24.6% 7,465 23.5% 613,486 18.7% $500,000 to $999,999 .............. 209 4.7% 1,287 4.1% 234,600 7.2% $1,000,000 or more ................ 0 0.0% 204 0.6% 53,191 1.6% Total ........................... 4,476 100.0% 31,770 100.0% 3,279,571 100.0% Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to 2011. Mortgage Status(1) The City The County State of Illinois Number Percent Number Percent Number Percent Housing Units with a Mortgage ..... 3,802 84.9% 27,085 85.3% 2,272,745 69.3% Housing Units Without a Mortgage .. 674 15.1% 4,685 14.7% 1,006,826 30.7% Total ........................... 4,476 100.0% 31,770 100.0% 3,279,571 100.0% Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to 2011. Income Per Capita Personal Income for the Ten Highest Income Counties in the State(1) Rank 2007-2011 1 .................... Lake County ................. $38,512 2 .................... DuPage County ............... 38,405 3 .................... McHenry County .............. 32,318 4 .................... Monroe County ............... 31,570 5 .................... Kendall County .............. 31,325 6 .................... Will County ................. 30,199 7 .................... Cook County ................. 29,920 8 .................... Woodford County ............. 29,886 9 .................... Kane County ................. 29,864 10 .................... Sangamon County ............. 29,167 Note: (1) Source: U.S. Bureau of the Census. 2007-2011 American Community 5-Year Estimates. 60 The following shows a ranking of median family income for the Chicago metropolitan area from the 2007-2011 American Community Survey. Ranking of Median Family Income(1) Ill. Family Ill. County Income Rank DuPage County .............$94,049 1 Lake County ............... 93,260 2 Kendall County ............ 90,696 3 McHenry County ............ 87,133 4 Will County ............... 86,372 5 Kane County ............... 79,686 7 Cook County ............... 65,842 20 Note: (1) Source: U.S. Bureau of the Census. 2007-2011 American Community 5-Year Estimates. The U.S. Census Bureau 5-year estimated values reported that the City had a median family income of $90,657. This compares to $90,696 for the County and $69,658 for the State of Illinois. The following table represents the distribution of family incomes for the City, the County and the State of Illinois at the time of the 2007- 2011 American Community Survey. Median Family Income(1) The City The County State of Illinois Value Number Percent Number Percent Number Percent Under $10,000 ..................... 8 0.2% 361 1.2% 131,841 4.2% $10,000 to $14,999 ................ 30 0.7% 175 0.6% 86,610 2.7% $15,000 to $24,999 ................ 265 6.3% 926 3.2% 224,421 7.1% $25,000 to $34,999 ................ 198 4.7% 1,379 4.7% 260,262 8.3% $35,000 to $49,999 ................ 415 9.8% 2,617 9.0% 389,862 12.4% $50,000 to $74,999 ................ 735 17.4% 5,659 19.4% 606,737 19.2% $75,000 to $99,999 ................ 762 18.0% 5,386 18.5% 486,151 15.4% $100,000 to $149,999 .............. 1,175 27.8% 8,409 28.9% 547,784 17.4% $150,000 to $199,999 .............. 342 8.1% 2,581 8.9% 212,016 6.7% $200,000 or more .................. 298 7.0% 1,609 5.5% 207,841 6.6% Total ........................... 4,228 100.0% 29,102 100.0% 3,153,525 100.0% Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to 2011. 61 The U.S. Census Bureau 5-year estimated values reported that the City had a median household income of $82,917. This compares to $82,649 for the County and $56,576 for the State of Illinois. The following table represents the distribution of household incomes for the City, the County and the State of Illinois at the time of the 2007-2011 American Community Survey. Household Income(1) The City The County State of Illinois Value Number Percent Number Percent Number Percent Under $10,000 ..................... 47 0.8% 689 1.9% 324,506 6.8% $10,000 to $14,999 ................ 75 1.3% 481 1.3% 225,927 4.7% $15,000 to $24,999 ................ 442 7.7% 1,697 4.6% 480,204 10.1% $25,000 to $34,999 ................ 286 5.0% 1,965 5.3% 462,115 9.7% $35,000 to $49,999 ................ 774 13.5% 3,940 10.7% 628,998 13.2% $50,000 to $74,999 ................ 949 16.6% 7,596 20.6% 884,623 18.5% $75,000 to $99,999 ................ 971 17.0% 6,558 17.8% 627,813 13.2% $100,000 to $149,999 .............. 1,485 26.0% 9,348 25.4% 656,199 13.7% $150,000 to $199,999 .............. 387 6.8% 2,870 7.8% 243,765 5.1% $200,000 or more .................. 305 5.3% 1,712 4.6% 238,852 5.0% Total ........................... 5,721 100.0% 36,856 100.0% 4,773,002 100.0% Note: (1) Source: U.S. Bureau of the Census, American Community Survey 5-year estimates 2007 to 2011. Retail Activity Following is a summary of the City’s sales tax receipts as collected and disbursed by the State. Retailers’ Occupation, Service Occupation and Use Tax(1) State Fiscal Year State Sales Tax Annual Percent Ending June 30 Distributions(2) Change + (-) 2004 .................................. $1,892,287 21.39%(3) 2005 .................................. 2,243,867 18.58% 2006 .................................. 2,548,784 13.59% 2007 .................................. 2,676,261 5.00% 2008 .................................. 2,506,434 (6.35%) 2009 .................................. 2,500,285 (0.25%) 2010 .................................. 2,446,099 (2.17%) 2011 .................................. 2,569,233 5.03% 2012 .................................. 2,552,483 (0.65%) 2013 .................................. 2,490,503 (2.43%) Growth from 2004 to 2013 ................................................... 25.64% Notes: (1) Source: Illinois Department of Revenue and the City. (2) Tax distributions are based on records of the Illinois Department of Revenue relating to the 1% municipal portion of the Retailers’ Occupation, Service Occupation and Use Tax, collected on behalf of the City, less a State administration fee. The municipal 1% includes tax receipts from the sale of food and drugs which are not taxed by the State. (3) The 2004 percentage is based on a 2003 sales tax of $1,558,831. 62 PLAN OF FINANCING Bond proceeds will be used to defease a portion of and to advance refund a portion of the City’s outstanding General Obligation Bonds (Alternate Revenue Source), Series 2005 (the “Defeased/Refunded Bonds”), to pay capitalized interest through June 1, 2015, and to pay the costs of issuance of the Bonds. General Obligation Bonds (Alternate Revenue Source), Series 2005 Outstanding Principal Principal Principal Amount Amount Redemption Redemption Maturities Amount Defeased Refunded Price Date 12/1/2014 ........... $ 195,000 $195,000 $ 0 100.00% 12/1/2014 12/1/2015 ........... 200,000 200,000 0 100.00% 12/1/2015 12/1/2016 ........... 210,000 0 210,000 100.00% 6/1/2015 12/1/2017 ........... 220,000 0 220,000 100.00% 6/1/2015 12/1/2018 ........... 225,000 0 225,000 100.00% 6/1/2015 12/1/2019 ........... 235,000 0 0 NA NA 12/1/2020 ........... 245,000 0 0 NA NA 12/1/2021 ........... 260,000 0 0 NA NA 12/1/2022 ........... 275,000 0 0 NA NA 12/1/2023 ........... 285,000 0 0 NA NA 12/1/2024 ........... 300,000 0 0 NA NA Total ............... $2,650,000 $395,000 $655,000 A portion of the Bond proceeds will be used to purchase direct full faith and credit obligations of the United States of America (the “Government Securities”), the principal of which together with interest to be earned thereon will be sufficient: (i) to pay when due the interest on the Defeased/Refunded Bonds as stated above, and (ii) to pay principal of and call premium, if any, on the Defeased/Refunded Bonds on their respective redemption dates. The Government Securities will be held in an escrow account created pursuant to an escrow agreement (the “Escrow Agreement”) between the City and The Bank of New York Mellon Trust Company, N.A., Chicago, Illinois, as Escrow Agent (the “Escrow Agent”). The mathematical calculations: (a) of the adequacy of the deposit made pursuant to the Escrow Agreement to provide for the payment of certain interest and principal on the Defeased/Refunded Bonds, and (b) supporting the opinion of Bond Counsel that the interest of the Bonds is excludable from gross income of the owners thereof for federal income tax purposes will be verified by Stanley P. Stone & Associates, Inc., Financing Consultants, New York, New York at the time of delivery of the Bonds. All moneys and Government Securities deposited for the payment of Defeased/Refunded Bonds, including interest thereon, are required to be applied solely and irrevocably to the payment of the Defeased/Refunded Bonds. 63 Projected Debt Service Coverage Table Sales Tax Alternate Revenue Source Bonds Revenue Mandatory Available for The Debt Service Coverage Year Debt Service(1) Series 2005(2) Bonds Total Coverage Amounts(3) 2014 ........ $2,490,503 $ 68,073 $ 45,784 $113,857 21.87x $142,321 2015 ........ 2,490,503 69,073 50,715 119,788 20.79x 149,734 2016 ........ 2,490,503 68,073 50,715 118,788 20.97x 148,484 2017 ........ 2,490,503 68,073 50,715 118,788 20.97x 148,484 2018 ........ 2,490,503 68,073 50,715 118,788 20.97x 148,484 2019 ........ 2,490,503 303,073 50,715 353,788 7.04x 442,234 2020 ........ 2,490,503 303,203 50,715 353,918 7.04x 442,397 2021 ........ 2,490,503 307,913 50,715 358,628 6.94x 448,284 2022 ........ 2,490,503 311,923 50,715 362,638 6.87x 453,297 2023 ........ 2,490,503 310,305 50,715 361,020 6.90x 451,275 2024 ........ 2,490,503 313,050 50,715 363,765 6.85x 454,706 2025 ........ 2,490,503 0 280,715 280,715 8.87x 350,894 2026 ........ 2,490,503 0 276,515 276,515 9.01x 345,644 2027 ........ 2,490,503 0 277,115 277,115 8.99x 346,394 2028 ........ 2,490,503 0 277,193 277,193 8.98x 346,491 2029 ........ 2,490,503 0 281,610 281,610 8.84x 352,013 Total ......................... $2,190,828 $1,946,082 Notes: (1) Based on the City's 2013 fiscal year report. (2) Does not include defeased/refunded bonds. (3) Equal to the mandatory 125% rate covenant. DEBT INFORMATION After issuance of the Bonds and the defeasance of a portion of the Series 2005 Bonds, the City will have outstanding $36,155,000 principal amount of general obligation debt and alternate revenue bond debt. For the 2012 tax levy (fiscal year ended April 30, 2014), the City did not abate the property tax levy for the Series 2005A bonds, and partially abated the property tax levies for the Series 2004B and Series 2007A Bonds. For the 2013 levy year, the City fully abated the Series 2004B Bonds, partially abated the Series 2007A Bonds and did not abate the Series 2005A Bonds. Going forward the City expects to gradually eliminate this practice by fiscal year 2019. The City also has outstanding $91,463,000 of special service area (SSA) debt and $2,060,997 for the fiscal year ended April 30, 2013 of IEPA loans. The debt service on the SSA debt is current and is being paid solely from SSA taxes; SSA debt is an obligation solely of the various SSAs and not an obligation of the City. 64 Outstanding General Obligation and Debt Certificate Debt(1) (Principal Only) Series Series Series Series Series Series Series Calendar 2003 2003A 2004A 2004B 2005 2005A 2005C Year Certificates Certificates Certificates (ARS)(2) (ARS)(3) (ARS)(2) (ARS)(4) 2014 .......... $100,000 $ 100,000 $190,000 $ 375,000 $ 195,000 $ 225,000 $ 100,000 2015 .......... 100,000 105,000 0 395,000 200,000 235,000 105,000 2016 .......... 100,000 110,000 0 410,000 210,000 250,000 110,000 2017 .......... 100,000 115,000 0 435,000 220,000 260,000 110,000 2018 .......... 300,000 120,000 0 455,000 225,000 275,000 120,000 2019 .......... 0 130,000 0 0 235,000 290,000 120,000 2020 .......... 0 135,000 0 0 245,000 300,000 130,000 2021 .......... 0 140,000 0 0 260,000 320,000 135,000 2022 .......... 0 150,000 0 0 275,000 335,000 140,000 2023 .......... 0 155,000 0 0 285,000 0 150,000 2024 .......... 0 0 0 0 300,000 0 150,000 2025 .......... 0 0 0 0 0 0 0 Total ....... $700,000 $1,260,000 $190,000 $2,070,000 $2,650,000 $2,490,000 $1,370,000 Series Series Series Series Cumulative Calendar Series 2006A 2007A 2011 2013 Outstanding Principal Retired Year 2006 Certificates (ARS)(2) (ARS)(5) Ref. Bonds Debt Amount Percent 2014 ........... $ 50,000 $ 420,000 $ 15,000 $ 685,000 $ 455,000 $ 2,910,000 $ 2,910,000 8.09% 2015 ........... 50,000 435,000 15,000 715,000 485,000 2,840,000 5,750,000 15.99% 2016 ........... 50,000 460,000 15,000 745,000 500,000 2,960,000 8,710,000 24.21% 2017 ........... 50,000 475,000 15,000 780,000 520,000 3,080,000 11,790,000 32.78% 2018 ........... 50,000 495,000 15,000 810,000 565,000 3,430,000 15,220,000 42.31% 2019 ........... 50,000 850,000 680,000 845,000 585,000 3,785,000 19,005,000 52.84% 2020 ........... 75,000 850,000 695,000 885,000 610,000 3,925,000 22,930,000 63.75% 2021 ........... 75,000 390,000 725,000 920,000 645,000 3,610,000 26,540,000 73.78% 2022 ........... 75,000 255,000 750,000 960,000 675,000 3,615,000 30,155,000 83.83% 2023 ........... 100,000 0 0 1,000,000 700,000 2,390,000 32,545,000 90.48% 2024 ........... 100,000 0 0 1,045,000 730,000 2,325,000 34,870,000 96.94% 2025 ........... 0 0 0 1,100,000 0 1,100,000 35,970,000 100.00% Total ........ $725,000 $4,630,000 $2,925,000 $10,490,000 $6,470,000 $35,970,000 Notes: (1) Source: the City; does not include December 2013 maturities. (2) Currently paid from tax levies. (3) Payable from revenues from Sales Taxes and the incremental taxes if any from the Countryside TIF. (4) Payable from revenues from the Water and Sewer System and State Income Taxes. (5) Payable from Special Sales Taxes. 65 General Obligation Bonded Debt After Refunding(1) (Principal Only) Less: Cumulative Calendar Outstanding The Defeased/Refunded Total Principal Retired Year Debt(2) Bonds Series 2005 Bonds Debt Amount Percent 2014 ......... $ 2,910,000 $ 0 $ (195,000) $ 2,715,000 $ 2,715,000 7.51% 2015 ......... 2,840,000 0 (200,000) 2,640,000 5,355,000 14.81% 2016 ......... 2,960,000 0 (210,000) 2,750,000 8,105,000 22.42% 2017 ......... 3,080,000 0 (220,000) 2,860,000 10,965,000 30.33% 2018 ......... 3,430,000 0 (225,000) 3,205,000 14,170,000 39.19% 2019 ......... 3,785,000 0 0 3,785,000 17,955,000 49.66% 2020 ......... 3,925,000 0 0 3,925,000 21,880,000 60.52% 2021 ......... 3,610,000 0 0 3,610,000 25,490,000 70.50% 2022 ......... 3,615,000 0 0 3,615,000 29,105,000 80.50% 2023 ......... 2,390,000 0 0 2,390,000 31,495,000 87.11% 2024 ......... 2,325,000 0 0 2,325,000 33,820,000 93.54% 2025 ......... 1,100,000 230,000 0 1,330,000 35,150,000 97.22% 2026 ......... 0 235,000 0 235,000 35,385,000 97.87% 2027 ......... 0 245,000 0 245,000 35,630,000 98.55% 2028 ......... 0 255,000 0 255,000 35,885,000 99.25% 2029 ......... 0 270,000 0 270,000 36,155,000 100.00% Total ...... $35,970,000 $1,235,000 $(1,050,000) $36,155,000 Note: (1) Source: the City. (2) See “DEBT INFORMATION - Outstanding General Obligation and Debt Certificate Debt” table for detail. Detailed Overlapping Bonded Debt(1) Outstanding Applicable to City Debt(2) Percent(3) Amount Schools: High School District Number 18 ........................................ $ 0 0.23% $ 0 Grade School District Number 66 ....................................... 1,565,000 0.33% 5,165 Unit School District Number 88 ........................................ 27,605,809 0.37% 102,141 Unit School District Number 115 ....................................... 81,945,267 58.30% 47,774,091 Community College District Number 516 ................................. 84,161,775 5.29% 4,452,158 Total Schools ................................................................................................... $52,333,555 Other(4): Kendall County(5) ..................................................... $39,573,762 16.59% $ 6,565,287 Kendall County Forest Preserve District ............................... 48,071,000 16.59% 7,974,979 Total Other ..................................................................................................... $14,540,266 Total Schools and Other Overlapping Bonded Debt .................................................................. $66,873,821 Notes: (1) Source: Kendall County Clerk. (2) As of May 8, 2013. (3) Percentages are based on 2012 EAVs, the latest available. (4) The United City of Yorkville Special Service Areas (also includes Series 2007 revenue bonds) have $91,463,000 in outstanding debt, which is expected to be paid from sources other than City revenues. (5) Includes Public Building Commission. 66 Statement of Bonded Indebtedness(1) Ratio To Per Capita Amount Equalized Estimated (2010 Census Applicable Assessed Actual 16,921) City EAV of Taxable Property, 2012 ........................... $ 443,122,808 100.00% 33.33% $26,187.74 Estimated Actual Value, 2012 ................................. $1,329,368,424 300.00% 100.00% $78,563.23 Net Direct Bonded Debt(2)(3) ................................. $ 20,410,000 4.61% 1.54% $ 1,206.19 Overlapping Bonded Debt(4): Schools ...................................................... $ 52,333,555 11.81% 3.94% $ 3,092.82 Other ........................................................ 14,530,266 3.28% 1.09% 858.71 Total Overlapping Bonded Debt .............................. $ 66,863,821 15.09% 5.03% $ 3,951.53 Total Net Direct and Overlapping Bonded Debt ................ $ 87,273,821 19.70% 6.57% $ 5,157.72 Notes: (1) Source: Kendall County Clerk. (2) Includes debt certificates and excludes alternate bonds and bonds to be defeased by this issue. (3) Excludes $91,463,000 bonds of the United City of Yorkville Special Service Areas which are expected to be paid from sources other than City revenues. (4) As of May 8, 2013. Legal Debt Margin(1) 2012 City Equalized Assessed Valuation ........................................................... $443,122,808 Statutory Debt Limitation (8.625% of EAV) ........................................................ $ 38,219,342 Series 2003 Certificates ..................................... $ 700,000 Series 2003A Certificates .................................... 1,260,000 Series 2004A Certificates .................................... 190,000 Series 2004B Bonds (ARS)(2) .................................. 2,070,000 Series 2005 Bonds (ARS)(3)(4) ................................ 1,600,000 Series 2005A Bonds (ARS)(2) .................................. 2,490,000 Series 2005C Bonds (ARS)(3) .................................. 1,370,000 Series 2006 Bonds ............................................ 725,000 Series 2006A Certificates .................................... 4,630,000 Series 2007A Bonds (ARS)(2) .................................. 2,925,000 Series 2011 Bonds (ARS)(3) ................................... 10,490,000 Series 2013 Bonds ............................................ 6,470,000 The Bonds(3) ................................................. 1,235,000 Total Debt ................................................. $ 36,155,000 Less: Series 2005 Bonds (ARS)(3) ................................... $ (2,650,000) Series 2005C Bonds (ARS)(3) .................................. (1,370,000) Series 2011 Bonds (ARS)(3) ................................... (10,490,000) The Bonds(3) ................................................. (1,235,000) Total Applicable Debt ......................................................................... $ 20,410,000 Legal Debt Margin ............................................................................. $ 17,809,342 Notes: (1) Source: the City. (2) Alternate bonds which have taxes levied for payment. (3) Series 2005 Bonds, Series 2005C Bonds, Series 2011 Bonds and the Bonds (the "Alternate Bonds") are alternate bonds and do not constitute an indebtedness of the City within the meaning of any constitutional statutory limitation, unless the pledged taxes will have been extended pursuant to the general obligation, full faith and credit promise supporting the Alternate Bonds in which case the amount of the outstanding Alternate Bonds will be included in the computation of indebtedness of the City for purposes of all statutory provisions or limitations until such time as an audit of the City shows that the Alternate Bonds have been paid from their pledged revenues for a complete fiscal year. (4) Does not include bonds being defeased. 67 PROPERTY ASSESSMENT AND TAX INFORMATION For the 2012 levy year, the City’s EAV was comprised of approximately 75% residential, 1% industrial, 23% commercial, and less than 1% farm and railroad property valuations. Equalized Assessed Valuation(1) Levy Years 2008 2009 2010 2011 2012 By Property Class Residential ............... $440,037,839 $444,422,818 $407,528,709 $367,600,683 $332,551,186 Farm ...................... 2,562,106 2,524,355 2,398,027 2,450,231 2,568,351 Commercial ................ 117,707,447 124,381,958 122,304,406 112,753,206 101,264,981 Industrial ................ 6,914,772 6,921,977 6,820,310 7,283,729 6,720,962 Railroad .................. 17,328 17,328 17,328 17,328 17,328 Total ................... $567,239,492 $578,268,436 $539,068,780 $490,105,177 $443,122,808 Percent Change ............ 11.30%(2) 1.94% (6.78%) (9.08%) (9.59%) Notes: (1) Source: Kendall County Clerk. (2) Percentage change based on 2007 EAV of $509,638,009. Representative Tax Rates(1) (Per $100 EAV) Levy Year 2008 2009 2010 2011 2012 The City: Corporate ........................................... $0.1329 $0.1138 $0.1472 $0.2108 $ 0.2354 Bonds and Interest .................................. 0.0000 0.0000 0.4105 0.1477 0.1097 IMRF ................................................ 0.0724 0.0778 0.0804 0.0918 0.1016 Police Protection ................................... 0.0550 0.0584 0.0620 0.0714 0.0790 Police Pension ...................................... 0.0573 0.0583 0.0670 0.0900 0.1229 Audit ............................................... 0.0073 0.0095 0.0098 0.0082 0.0068 Liability Insurance ................................. 0.0387 0.0583 0.0615 0.0082 0.0090 Social Security/IMRF ................................ 0.0541 0.0528 0.0546 0.0612 0.0677 School Cross Guard .................................. 0.0043 0.0042 0.0044 0.0051 0.0057 Unemployment Insurance .............................. 0.0047 0.0043 0.0045 0.0102 0.0113 Total City Rates(2) ............................... $0.4267 $0.4374 $0.9020 $0.7045 $ 0.7490 Kendall County ...................................... 0.5724 0.5734 0.6396 0.6999 0.7446 Kendall County Forest Preserve ...................... 0.0966 0.0944 0.1041 0.1205 0.1495 Bristol Township .................................... 0.2921 0.2963 0.3246 0.3693 0.3935 Bristoll - Kendall Fire District .................... 0.5896 0.6007 0.6734 0.7176 0.7356 Yorkville - Bristol Sanitary District ............... 0.0000 0.0000 0.0000 0.0000 0.0000 Unit School District Number 115 ..................... 4.5923 4.6973 5.2767 5.9101 6.7561 Community College District Number 516 ............... 0.3990 0.4037 0.4115 0.4702 0.5306 Yorkville Library ................................... 0.2099 0.2172 0.2589 0.3042 0.3242 Total Tax Rates(3) ................................ $7.1786 $7.3204 $8.5908 $9.2962 $10.3831 Notes: (1) Source: Kendall County Clerk. (2) Statutory tax rate limits for the City are as follows: Corporate ($0.4375); Police Protection ($0.6000); Garbage ($0.2000); School Crossing Guard ($0.0200). (3) Representative tax rates for other government units are from Bristol Township tax code 005. 68 Tax Extensions and Collections(1) (Excludes Road, Bridge and Library Levies) Levy Coll. Taxes Taxes Collected(3) Year Year Extended(2) Amount Percent 2007 ............ 2008 ............. $2,122,133 $2,101,984 99.05% 2008 ............ 2009 ............. 2,420,411 2,407,483 99.47% 2009 ............ 2010 ............. 2,529,057 2,521,570 99.70% 2010 ............ 2011 ............. 4,862,185 4,849,681 99.74% 2011 ............ 2012 ............. 3,452,742 3,435,616 99.50% 2012 ............ 2013(4) .......... 3,318,990 3,185,693 95.98% Notes: (1) Source: Kendall County Treasurer and the City. (2) Tax extensions have been adjusted for abatements. (3) Total collections include back taxes, taxpayer refunds, interest, etc. (4) As of December 13, 2013. Principal Taxpayers(1) Taxpayer Name Business/Service 2012 EAV(2) Menard, Inc. ................................................. Retail .................................................. $ 7,804,600 Copley Ventures, Inc. ........................................ Real Property ........................................... 7,338,864 Cannonball LLC ............................................... Commercial Real Estate .................................. 4,596,172 Yorkville Shopping Center I .................................. Shopping Center ......................................... 3,884,596 Target Corporation ........................................... Retail .................................................. 3,104,272 Wrigley Manufacturing Co LLC ................................. Gum ..................................................... 2,893,422 Boombah Properties LLC ....................................... Retail .................................................. 2,269,648 Home Depot USA Inc. .......................................... Retail .................................................. 1,832,215 Prime Yorkville LLC .......................................... Office Building Complex ................................. 1,803,983 York Meadows LLC ............................................. Apartments .............................................. 1,686,666 Total ............................................................................................................... $37,214,438 Ten Largest Taxpayers as Percent of City's 2012 EAV ($443,122,808) ................................................... 8.40% Notes: (1) Source: Kendall County Clerk. (2) Every effort has been made to seek out and report the largest taxpayers. However, many taxpayers listed contain multiple parcels and it is possible that some parcels and their valuations have been overlooked. The 2012 EAV by PIN is the most current available. REAL PROPERTY ASSESSMENT, TAX LEVY AND COLLECTION PROCEDURES Tax Levy and Collection Procedures Local assessment officers determine the assessed valuation of taxable real property and railroad property not held or used for railroad operations. The Illinois Department of Revenue (the “Department”) assesses certain other types of taxable property, including railroad property held or used for railroad operations. Local assessment officers’ valuation determinations are subject to review at the county level and then, in general, to equalization by the Department. Such equalization is achieved by applying to each county’s assessments a multiplier determined by the Department. The purpose of equalization is to provide a common basis of assessments among counties by adjusting assessments toward the statutory standard of 33-1/3% of fair cash value. Farmland is assessed according to a statutory formula which takes into account factors such as productivity and crop mix. Taxes are extended against the assessed values after equalization. Property tax levies of each taxing body are filed in the office of the county clerk of each county in which territory of that taxing body is located. The county clerk computes the rates and amount of taxes applicable to taxable property subject to the tax levies of each taxing body and determines the dollar amount of taxes attributable to each respective parcel of taxable property. The county clerk then supplies to the appropriate collecting officials within the county the information needed to bill the taxes attributable to the various parcels therein. After the taxes have been collected, the collecting officials distribute to the various taxing bodies their respective shares of the taxes collected. Taxes levied in one calendar year are due and payable in two installments during the next calendar year. Taxes that are not paid when due, or that are not paid by mail and postmarked on or before the due date, are subject to a penalty of 1-1/2% per month until paid. Unpaid property taxes, together with penalties, interest and costs, constitute a lien against the property subject to the tax. 69 Exemptions An annual General Homestead Exemption (the “General Homestead Exemption”) provides that the Equalized Assessed Valuation (“EAV”) of certain property owned and used for residential purposes (“Residential Property”) may be reduced by the amount of any increase over the 1977 EAV, up to a maximum reduction of $3,500 for assessment years prior to assessment year 2004 in counties with less than 3,000,000 inhabitants, and a maximum reduction of $5,000 for assessment year 2004 through 2007 in all counties. The maximum reduction is $5,500 for assessment year 2008 and the maximum reduction is $6,000 for assessment year 2009 and thereafter in all counties. Additionally, maximum reduction increased to $7,000 for assessment year 2012 for Cook County. The Homestead Improvement Exemption applies to Residential Properties that have been improved or rebuilt in the 2 years following a catastrophic event. The exemption is limited to $45,000 through December 31, 2003, and $75,000 per year beginning January 1, 2004 and thereafter, to the extent the assessed value is attributable solely to such improvements or rebuilding. Additional exemptions exist for senior citizens. The Senior Citizens Homestead Exemption (“Senior Citizens Homestead Exemption”) operates annually to reduce the EAV on a senior citizen’s home for assessment years prior to 2004 by $2,000 in counties with less than 3,000,000 inhabitants. For assessment years 2004 and 2005, the maximum reduction is $3,000 in all counties. For assessment years 2006 and 2007, the maximum reduction is $3,500 in all counties. For assessment year 2008 and thereafter, the maximum reduction is $4,000 for all counties. Beginning with tax year 2012, the maximum reduction increased to $5,000 for Cook County. Beginning with tax year 2013, the maximum reduction increased to $5,000 for all other counties. Furthermore, beginning with assessment year 2003, for taxes payable in 2004, property that is first occupied as a residence after January 1 of any assessment year by a person who is eligible for the Senior Citizens Homestead Exemption must be granted a pro rata exemption for the assessment year based on the number of days during the assessment year that the property is occupied as a residence by a person eligible for the exemption. A Senior Citizens Assessment Freeze Homestead Exemption (“Senior Citizens Assessment Freeze Homestead Exemption”) freezes property tax assessments for homeowners, who are 65 and older and receive a household income not in excess of the maximum income limitation. The maximum income limitation is $35,000 for years prior to 1999, $40,000 for assessment years 1999 through 2003, $45,000 for assessment years 2004 and 2005, $50,000 from assessment years 2006 and 2007 and for assessments year 2008 and after, the maximum income limitation is $55,000. In general, the Senior Citizens Assessment Freeze Homestead Exemption limits the annual real property tax bill of such property by granting to qualifying senior citizens an exemption as to a portion of the valuation of their property. In counties with a population of 3,000,000 or more, the exemption for all assessment years is equal to the EAV of the residence in the assessment year for which application is made less the base amount. Furthermore, for those counties with a population of less than 3,000,000, the Senior Citizens Assessment Freeze Homestead Exemption is as follows: through assessment year 2005 and for assessment year 2007 and later, the exempt amount is the difference between (i) the current EAV of their residence and (ii) the base amount, which is the EAV of a senior citizen’s residence for the year prior to the year in which he or she first qualifies and applies for the Exemption (plus the EAV of improvements since such year). For assessment year 2006, the amount of the Senior Citizens Assessment Freeze Homestead Exemption phases out as the amount of household income increases. The amount of the Senior Citizens Assessment Freeze Homestead Exemption is calculated by using the same formula as above, and then multiplying the resulting value by a ratio that varies according to household income. Another exemption available to disabled veterans operates annually to exempt up to $70,000 of the Assessed Valuation of property owned and used exclusively by such veterans or their spouses for residential purposes. Also, certain property is exempt from taxation on the basis of ownership and/or use, such as public parks, not-for-profit schools and public schools, churches, and not-for-profit hospitals and public hospitals. However, individuals claiming exemption under the Disabled Persons’ Homestead Exemption (“Disabled Persons’ Homestead Exemption”) or the Disabled Veterans Standard Homestead Exemption (“Disabled Veterans Standard Homestead Exemption”) cannot claim the aforementioned exemption. 70 Furthermore, beginning with assessment year 2007, the Disabled Persons’ Homestead Exemption provides an annual homestead exemption in the amount of $2,000 for property that is owned and occupied by certain persons with a disability. However, individuals claiming exemption as a disabled veteran or claiming exemption under the Disabled Veterans Standard Homestead Exemption cannot claim the aforementioned exemption. In addition, the Disabled Veterans Standard Homestead Exemption provides disabled veterans an annual homestead exemption starting with assessment year 2007 and thereafter. Specifically, (i) those veterans with a service- connected disability of 75% are granted an exemption of $5,000 and (ii) those veterans with a service-connected disability of less than 75%, but at least 50% are granted an exemption of $2,500. Furthermore, the veteran’s surviving spouse is entitled to the benefit of the exemption, provided that the spouse has legal or beneficial title of the homestead, resides permanently on the homestead and does not remarry. Moreover, if the property is sold by the surviving spouse, then an exemption amount not to exceed the amount specified by the current property tax roll may be transferred to the spouse’s new residence, provided that it is the spouse’s primary residence and the spouse does not remarry. However, individuals claiming exemption as a disabled veteran or claiming exemption under the Disabled Persons’ Homestead Exemption cannot claim the aforementioned exemption. Beginning with assessment year 2007, the Returning Veterans’ Homestead Exemption (“Returning Veterans’ Homestead Exemption”) is available for property owned and occupied as the principal residence of a veteran in the assessment year the veteran returns from an armed conflict while on active duty in the United States armed forces. This provision grants a homestead exemption of $5,000, which is applicable in all counties. In order to apply for the Returning Veterans’ Homestead Exemption, the individual must pay real estate taxes on the property, own the property or have either a legal or an equitable interest in the property, “or a leasehold interest of land on which a single family residence is located, which is occupied as a principle residence of a veteran returning from an armed conflict involving the armed forces of the United States who has an ownership interest therein, legal, equitable or as a lessee, and on which the veteran is liable for the payment of property taxes.” Those individuals eligible for the Returning Veterans’ Homestead Exemption may claim the Returning Veterans’ Homestead Exemption, in addition to other homestead exemptions, unless otherwise noted. Property Tax Extension Limitation law The Property Tax Extension Limitation Law, as amended (the “Limitation Law”), limits the annual growth in the amount of property taxes to be extended for certain Illinois non-home-rule units, including the City. In general, the annual growth permitted under the Limitation Law is the lesser of 5% or the percentage increase in the Consumer Price Index during the calendar year preceding the levy year. Taxes can also be increased due to new construction, referendum approval of tax rate increases, mergers and consolidations. The effect of the Limitation Law is to limit the amount of property taxes that can be extended for a taxing body. In addition, general obligation bonds, notes and installment contracts payable from ad valorem taxes unlimited as to rate and amount cannot be issued by the affected taxing bodies unless they are approved by referendum, are alternate bonds (such as the Bonds) or are for certain refunding purposes. The City has the authority to levy taxes for many different purposes. See the table entitled Representative Tax Rates under “PROPERTY ASSESSMENT AND TAX INFORMATION” herein. The ceiling at any particular time on the rate at which these taxes may be extended for the City is either (i) unlimited (as provided by statute), (ii) initially set by statute but permitted to be increased by referendum, (iii) capped by statute, or (iv) limited to the rate approved by referendum. Public Act 94-0976, effective June 30, 2006, provides that the only ceiling on a particular tax rate is the ceiling set by statute above, at which the rate is not permitted to be further increased by referendum or otherwise. Therefore, taxing districts (such as the City) will have increased flexibility to levy taxes for the purposes for which they most need the money. The total aggregate tax rate for the various purposes subject to the Limitation Law, however, will not be allowed to exceed the City’s limiting rate computed in accordance with the provisions of the Limitation Law. 71 Local governments, including the City, can issue limited tax bonds in lieu of general obligation bonds that have otherwise been authorized by applicable law. Truth in Taxation Law Legislation known as the Truth in Taxation Law (the “Law”) limits the aggregate amount of certain taxes which can be levied by, and extended for, a taxing district to 105% of the amount of taxes extended in the preceding year unless specified notice, hearing and certification requirements are met by the taxing body. The express purpose of the Law is to require published disclosure of, and hearing upon, an intention to adopt a levy in excess of the specified levels. FINANCIAL INFORMATION Financial Reports The City’s financial statements are audited annually by certified public accountants and are in conformity with accounting principles generally accepted in the United States of America. 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. Government funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. See APPENDIX A for more detail. No Consent or Updated Information Requested of the Auditor The tables and excerpts (collectively, the “Excerpted Financial Information”) contained in this “FINANCIAL INFORMATION” section and in APPENDIX A are from the audited financial statements of the City, including the audited financial statements for the fiscal year ended April 30, 2013 (the “2013 Audit”) which was approved by formal action of the City Council. The City has not requested the Auditor to update information contained in the Excerpted Financial Information; nor has the City requested that the Auditor consent to the use of the Excerpted Financial Information in this Final Official Statement. Other than as expressly set forth in this Final Official Statement, the financial information contained in the Excerpted Financial Information has not been updated since the date of the 2013 Audit. The inclusion of the Excerpted Financial Information in this Final Official Statement in and of itself is not intended to demonstrate the fiscal condition of the City since the date of the 2013 Audit. Questions or inquiries relating to financial information of the City since the date of the 2013 Audit should be directed to the City. Summary Financial Information The following tables are summaries and do not purport to be the complete audits, copies of which are available upon request. See APPENDIX A for excerpts of the City’s 2013 Audit. 72 Statement of Net Assets(1) Governmental Activities Audited as of April 30 2008 2009 2010 2011 2012 ASSETS: Current Assets: Cash and Cash Equivalents ............................... $ 5,440,498 $ 4,744,779 $ 4,185,507 $ 4,379,393 $ 4,395,719 Receivables: Property Taxes Receivable ............................... 3,033,744 2,049,489 3,276,306 4,469,943 4,623,354 Intergovernmental Receivables ........................... 1,741,444 1,575,497 2,054,417 1,923,851 0 Accounts Receivable ..................................... 1,085,875 1,298,559 459,445 494,959 380,675 Utility Taxes Receivable ................................ 0 0 247,659 239,106 0 Other Taxes ............................................. 0 0 0 0 2,577,391 Internal Balances ........................................ (86,307) (2,128,740) (2,482,580) (2,219,599) (1,145,614) Prepaid Items ............................................ 0 0 54,288 145,404 181,683 Other Assets ............................................. 296,722 448,534 0 0 400,000 Total Current Assets ................................... $11,511,976 $ 7,988,118 $ 7,795,042 $ 9,433,057 $11,413,208 Capital Assets (Net of Accumulated Depreciation): Land, Land Improvements and CIP ......................... $33,258,775 $ 30,163,653 $ 30,049,329 $ 30,274,710 $30,224,292 Infrastructure .......................................... 17,502,394 18,243,547 28,050,993 28,580,530 28,726,021 Building and Improvements ............................... 12,514,443 13,003,871 12,713,680 12,486,849 12,195,378 Equipment and Vehicles .................................. 3,678,656 4,351,137 3,602,054 3,055,284 2,665,905 Total Capital Assets ................................... $66,954,268 $65,762,208 $82,211,098 $74,397,373 $73,811,596 Other Assets: Net Pension Benefit ..................................... $ 16,161 $ 16,161 $ 0 $ 0 $ 0 Deferred Charges ........................................ 75,466 66,494 58,060 50,180 42,893 Total Other Assets ..................................... $ 91,627 $ 82,655 $ 58,060 $ 50,180 $ 42,893 Total Assets ........................................... $78,557,871 $73,832,981 $82,269,158 $83,880,610 $85,267,697 LIABILITIES AND NET ASSETS: Liabilities: Current Liabilities: Accounts Payable ........................................ $ 928,628 $ 220,782 $ 335,840 $ 689,702 $ 527,054 Deposits Payable ........................................ 0 0 0 0 66,584 Retainage Payable ....................................... 0 0 0 3,201 0 Accrued Payroll ......................................... 70,457 93,501 117,174 99,928 108,478 Interest Payable ........................................ 244,190 235,790 228,618 218,758 213,875 Unearned Revenue ........................................ 3,244,759 2,183,722 3,315,611 4,514,986 5,671,251 Current Portion of Long-Term Debt ........................ 0 0 0 0 1,098,099 Other Liabilities ....................................... 45,075 145,022 567,031 417,495 356,259 Total Current Liabilities ............................. $ 4,533,109 $ 2,878,817 $ 4,564,274 $ 5,944,070 $ 8,041,600 Noncurrent Liabilities: Long-Term Obligations, Due within One Year: Bonds Payable ........................................... $ 310,000 $ 580,000 $ 650,000 $ 790,000 $ 0 Debt Certificates Payable ............................... 140,000 145,000 95,000 95,000 0 Notes Payable ........................................... 0 124,937 151,544 153,254 0 Loan Installment Purchase ............................... 100,000 0 0 0 0 Compensated Absences .................................... 277,351 320,364 221,316 242,538 292,100 Accrued Claims .......................................... 0 0 60,000 0 0 Long-Term Obligations, Due in more than One Year: Bonds Payable ........................................... 15,945,000 15,365,000 14,715,000 13,925,000 13,025,000 Loans Payable ........................................... 1,890 1,890 1,890 0 0 Debt Certificates Payable ............................... 430,000 285,000 190,000 95,000 0 Notes Payable ........................................... 0 1,152,623 1,001,079 849,715 817,751 Loan Installment Purchase ............................... 350,000 0 0 0 0 Compensated Absences .................................... 190,810 273,047 165,631 299,148 0 Net Pension Obligation .................................. 0 0 133,940 398,325 564,311 Other Post-employment Benefits .......................... 0 2,345 4,676 7,007 9,453 Other Liabilities ....................................... 105,000 105,000 0 0 1,890 Total Noncurrent Liabilities ........................... $17,850,051 $18,355,206 $17,390,076 $16,854,987 $14,710,505 Total Liabilities ...................................... $22,383,160 $21,234,023 $21,954,350 $22,799,057 $22,752,105 Net Assets: Invested in Capital Assets, Net of Related Debt ........... $53,202,922 $51,529,648 $60,971,543 $61,594,404 $58,943,771 Restricted for Capital Projects .......................... 3,630,544 2,821,728 3,042,137 2,736,585 3,478,139(2) Restricted for Debt Service .............................. 0 285,643 426,013 578,443 0 Unrestricted Net Assets .................................. (658,755) (2,038,061) (4,124,885) (3,827,879) 93,682 Total Net Assets ....................................... $56,174,711 $52,598,958 $60,314,808 $61,081,553 $62,515,592 Notes: (1) Changed to Statement of Net Position in 2013. See table on page 26. (2) For fiscal year ending April 30, 2012, consisting of $388,198 for Library Operations, $29,259 for Special Service Areas, $924,857 for Motor Fuel Tax and $2,135,825 for Tax Increment Financing District. 73 Statement of Net Position Governmental Activities Audited as of April 30 2013 ASSETS: Current Assets: Cash and Investments ............................................................... $ 7,752,435 Receivables - Net .................................................................. 7,364,633 Prepaids ........................................................................... 174,571 Internal Balances .................................................................. (259,447) Due from Other Governments .......................................................... 15 Total Current Assets .............................................................. $ 15,032,207 Noncurrent Assets: Capital Assets: Nondepreciable Capital Assets ....................................................... $ 31,020,430 Depreciable Capital Assets .......................................................... 66,528,719 Accumulated Depreciation ............................................................ (21,705,810) Total Capital Assets .............................................................. $ 75,843,339 Total Assets ...................................................................... $ 90,875,546 LIABILITIES: Current Liabilities: Accounts Payable ................................................................... $ 819,023 Deposits Payable ................................................................... 289,418 Accrued Payroll .................................................................... 137,178 Accrued Interest Payable ............................................................ 199,038 Other Liabilities .................................................................. 288,139 Other Payables ..................................................................... 87,015 Current Portion of Long-Term Debt ................................................... 928,122 Total Current Liabilities .......................................................... $ 2,747,933 Noncurrent Liabilities: Compensated Absences Payable ........................................................ $ 244,440 Net Pension Obligation Payable ...................................................... 653,423 Net Other Post-Employment Benefit Payable ........................................... 7,927 Notes Payable ...................................................................... 823,589 General Obligation Bonds Payable .................................................... 12,190,000 Other Liabilities .................................................................. 1,890 Total Noncurrent Liabilities ....................................................... 13,921,269 Total Liabilities ................................................................. $ 16,669,202 DEFERRED INFLOWS OF RESOURCES: Property and State Taxes.............................................................. $ 5,364,612 Total Liabilities and Deferred Inflows of Resources ................................ $ 22,033,814 NET POSITION: Net Investment in Capital Assets ...................................................... $ 61,962,738 Restricted: Library Operations ................................................................. 453,630 Special Service Areas .............................................................. 2 2,864 Motor Fuel Tax ..................................................................... 1,152,348 Land Cash .......................................................................... 121,420 Tax Increment Financing Districts ................................................... 1,787,605 Unrestricted ......................................................................... 3,341,127 Total Net Position ................................................................ $ 68,841,732 74 Statement of Activities Governmental Activities Statement of Net (Expense) Revenue and Changes in Net Assets Year Ended April 30 2009 2010 2011 2012 2013 PRIMARY GOVERNMENT(1): Governmental Activities General Government ....................................... $ (3,790,396) $(2,563,751) $ (2,799,032) $ (3,674,413) $(1,308,913) Public Safety ............................................ (3,097,083) (3,660,914) (3,287,448) (2,905,184) (3,750,318) Public Works ............................................. (502,929) 8,002,542 (1,214,089) (1,275,841) 470,019 Library .................................................. (2,993,925) (1,023,547) (1,104,099) (798,256) (849,831) Parks and Recreation ..................................... 321,319 (1,664,356) (1,217,887) (1,161,266) (1,072,532) Community Development .................................... (2,155,995) (447,491) (394,687) (307,053) (356,689) Unallocated Bad Debt Adjustments ......................... 0 (1,016,132) 0 0 0 Interest on Debt ......................................... (741,303) (757,192) (723,246) (704,213) (691,551) Total Governmental Activities .......................... $(12,960,312) $(3,130,841) $(10,740,488) $(10,826,226) $(7,559,815) GENERAL REVENUES: Taxes: Property Taxes .......................................... $ 3,670,632 $ 4,087,698 $ 4,281,902 $ 4,953,862 $ 4,743,599 Sales Tax ............................................... 2,474,549 2,480,213 2,577,651 2,962,810 4,409,926 Income Tax .............................................. 1,124,204 1,280,519 1,306,325 1,444,426 1,587,324 Utility Taxes ........................................... 1,630,188 1,542,649 1,614,294 1,568,699 1,553,693 Other Taxes ............................................. 861,936 641,360 780,863 963,524 922,439 Development Fees ......................................... 454,822 0 0 0 0 Investment Earnings ...................................... 74,761 73,327 6,762 10,388 16,368 Other General Revenues ................................... 1,336,958 783,999 764,528 667,637 652,606 Transfers ................................................ (2,243,491) 134,209 174,908 0 0 Total General Revenues ................................. $ 9,384,559 $11,023,974 $ 11,507,233 $ 12,571,346 $13,885,955 Change in Net Assets ..................................... $ (3,575,753) $ 7,893,133 $ 766,745 $ 1,745,120 $ 6,326,140 Net Assets Beginning of Year, as Restated .......................... 56,174,711 52,421,675 60,314,808 60,770,472 62,515,592 End of Year ............................................. $ 52,598,958 $60,314,808 $ 61,081,553 $ 62,515,592 $68,841,732 Note: (1) Expenses net of program revenues of Fees, Fines & Charges for Services, Operating Grants and Contributions, and Capital Grants and Contributions. 75 General Fund Balance Sheet Audited as of April 30 2009 2010 2011 2012 2013 ASSETS: Cash and Investments ..................................... $ 0 $ 0 $ 0 $ 0 $3,139,755 Property Taxes Receivable ................................ 1,390,069 2,626,306 2,749,964 2,801,487 2,950,692 Other Governmental Receivables ........................... 1,553,123 1,748,223 1,576,444 0 15 Account Receivable ....................................... 1,298,559 459,445 488,780 369,626 205,599 Other Taxes Receivable ................................... 0 0 0 2,543,802 2,328,040 Utility Taxes Receivable ................................. 0 247,659 239,106 0 0 Interfund Receivable ..................................... 69,220 0 100,000 0 0 Prepaid Items ............................................ 0 39,497 136,917 153,770 139,985 Other Assets ............................................. 164,587 0 0 7,479 0 Total Assets ........................................... $4,475,558 $5,121,130 $5,291,211 $5,876,164 $8,764,086 LIABILITIES AND FUND BALANCE: Liabilities: Accounts Payable ......................................... $ 123,376 $ 258,021 $ 531,957 $ 477,374 $ 586,758 Accrued Payroll .......................................... 69,525 87,832 75,382 78,840 100,025 Deposits Payable ......................................... 0 0 0 54,498 271,365 Retainage Payable ........................................ 32,867 0 0 0 0 Interfund Payable ........................................ 865,218 1,815,685 1,577,286 0 0 Other Payable ............................................ 112,155 401,201 198,074 114,854 0 Due to Other Funds ....................................... 0 0 0 497,989 17,448 Deferred Revenue ......................................... 1,876,877 3,048,330 3,180,412 3,381,986 0 Total Liabilities ...................................... $3,080,018 $5,611,069 $5,563,111 $4,605,541 $ 975,596 DEFERRED INFLOWS OF RESOURCES(1): Property and State Taxes ................................. $ 0 $ 0 $ 0 $ 0 $3,564,670 Total Liabilities and Deferred Inflows of Resources ..... $ 0 $ 0 $ 0 $ 0 $4,540,266 Fund Balances: Unassigned ............................................... $1,230,953 $ (532,436) $ (408,817) $ 784,353 $4,083,835 Nonspendable ............................................. 0 0 0 153,770 139,985 Assigned ................................................. 0 0 0 332,500 0 Reserved for Prepaid Items ............................... 164,587 39,497 136,917 0 0 Total Fund Balance ..................................... $1,395,540 $ (492,939) $ (271,900) $1,270,623 $4,223,820 Total Liabilities, Deferred Inflows of Resources and Fund Balances(1) .................................. $4,475,558 $5,118,130 $5,291,211 $5,876,164 $8,764,086 Note: (1) Change in reporting format. 76 General Fund Revenues and Expenditures Audited Fiscal Year Ending April 30 2009 2010 2011 2012 2013 REVENUES: Property Taxes ................................. $ 2,245,490 $ 2,407,483 $ 2,521,570 $ 2,709,936 $ 2,715,518 Township Road and Bridge Taxes ................. 0 151,196 164,296 166,896 168,477 Sales Tax ...................................... 2,500,285 2,446,099 2,569,233 2,552,483 2,490,503 Non-HR Sales ................................... 0 0 0 410,327 1,919,423 Income Tax ..................................... 1,004,980 1,277,889 1,315,321 1,444,426 1,587,324 Utility Tax .................................... 572,959 833,669 873,999 828,426 835,972 Other Taxes .................................... 1,601,673 1,322,380 1,521,787 1,441,803 1,355,967 Intergovernmental .............................. 0 0 0 277,715 304,937 Charges for Services ........................... 0 1,252,904 1,298,042 1,561,554 1,199,908 Licenses, Permits & Fees ....................... 1,748,512 304,415 241,752 171,921 168,831 Fines .......................................... 130,344 154,575 201,236 175,159 169,144 Interest Revenues .............................. 18,629 62,043 1,760 5,102 7,287 Other Revenue .................................. 435,586 441,908 520,082 433,555 391,519 Grants ......................................... 0 8,209 53,537 50 0 Total Revenues .............................. $10,258,458 $10,662,770 $11,282,615 $12,179,353 $13,314,810 EXPENDITURES: General Government ............................. $ 5,030,274 $ 4,577,468 $ 4,713,073 $ 4,814,105 $ 3,296,379 Streets & Sanitation ........................... 1,752,822 1,800,389 1,788,538 1,703,802 1,647,589 Community Development .......................... 461,182 419,785 395,291 307,053 365,188 Public Safety .................................. 3,160,730 3,260,256 2,883,254 2,846,420 3,550,955 Total Expenditures .......................... $10,405,008 $10,057,898 $ 9,780,156 $ 9,671,380 $ 8,860,111 Excess (Deficiency) of Revenues Over Expenditures .................................. $ (146,550) $ 604,872 $ 1,502,459 $ 2,507,973 $ 4,454,699 Other Financing Sources (Uses): Operating Transfers In ......................... $ 902,485 $ 344,658 $ 235,357 $ 0 $ 0 Operating Transfers Out ........................ (2,312,731)(1) (1,644,594)(2) (1,516,778)(4) (965,450)(5) (1,501,502)(6) Total Other Financing Sources (Uses) ........ $(1,410,246) $(1,299,936) $(1,281,421) $ (965,450) $(1,501,502) SPECIAL ITEM: Adjustment for Bad Debts ....................... $ 0 $(1,016,132) $ 0 $ 0 $ 0 Net Change in Fund Balances .................... $(1,556,796) $(1,711,196) $ 221,038 $ 1,542,523 $ 2,953,197 Fund Balance - Beginning of the Year ........... $ 2,952,336 $ 1,218,257(3) $ (492,939) $ (271,900) $ 1,270,623 Fund Balance - End of the Year ................. $ 1,395,540 $ (492,939) $ (271,900) $ 1,270,623 $ 4,223,820 Notes: (1) $220,000 to City Wide Capital for capital purchases and installment purchase; $1,080,348 to Park and Recreation to supplement operations; $200,000 to Water Improvement for capital purchases; $662,383 to Debt Service Fund; $150,000 to Sewer for capital purchases. (2) $100,000 to City Wide Capital for installment purchase; $969,500 to Park and Recreation to supplement operations; $150,000 to Park and Recreation as a loan to supplement cashflow to be repaid; $425,094 to Debt Service Fund. (3) Adjusted. (4) $951,890 to Park and Recreation to supplement operations; $429,404 to Debt Service Fund; $135,484 to City Wide Capital to cover an installment payment on long-term debt and for sidewalk replacement. (5) $125,000 to City Wide Capital for an installment payment; $103,740 to Debt Service Fund; $736,710 to Park and Recreation to supplement operations. (6) $419,332 to City Wide Capital for ongoing capital projects; $99,465 to Debt Service Fund; $955,886 to Park and Recreation to supplement operations; $26,819 to Library Fund for reimbursement of liability and unemployment insurance. 77 General Fund Budget Financial Information Adopted Adopted Budget Budget Fiscal Year Fiscal Year Ending Ending 4/30/2013 4/30/2014 REVENUES: Taxes .............................................................. $ 8,788,433 $ 9,359,104 Intergovernmental .................................................. 1,759,600 1,998,200 Licenses and Permits ............................................... 169,300 193,000 Fines and Forfeits ................................................. 201,000 180,200 Charges for Services ............................................... 1,178,784 1,181,235 Investment Earnings ................................................ 3,100 6,500 Reimbursements ..................................................... 199,892 75,000 Miscellaneous ...................................................... 11,000 11,000 Other Financing Sources ............................................ 0 5,250 Total Revenues ................................................... $12,311,109 $13,009,489 EXPENDITURES: Salaries ........................................................... $ 3,371,895 $ 3,546,298 Benefits ........................................................... 2,327,040 2,270,039 Contractual Services ............................................... 3,840,120 3,934,440 Supplies ........................................................... 274,151 292,110 Contingencies ...................................................... 50,000 50,000 Other Financing Uses ............................................... 1,516,661 3,798,673 Total Expenditures ............................................... $11,379,867 $13,891,560 Excess (Deficiency) of Revenues Over Expenditures ................... $ 931,242 $ (882,071) EMPLOYEE RETIREMENT AND OTHER POSTEMPLOYMENT BENEFITS OBLIGATIONS The City contributes to two defined benefit pension plans, the Illinois Municipal Retirement Fund, a defined benefit agent multiple-employer public employee retirement system, and the Police Pension Plan which is a single- employer pension plan. A separate report is issued for the Police Pension Plan and may be obtained by writing to the City at 800 Game Farm Road, Yorkville, Illinois 60560. IMRF does issue a publicly available financial report that includes financial statements and required supplementary information for the plan as a whole, but not by individual employer. That report may be obtained on-line at www.imrf.org. The benefit, benefit levels, employee contributions, and employer contributions are governed by Illinois Compiled Statutes and can only be amended by the Illinois General Assembly. Plan Descriptions, Provisions and Funding Policies Illinois Municipal Retirement System(1) All employees (other than those covered by the Police Pension plan) hired in positions that meet or exceed the prescribed annual hourly standard must be enrolled in IMRF as participating members. Participating members hired before January 1, 2011 who retire at or after age 60 with 8 years of service are entitled to an annual retirement benefit, payable monthly for life, in an amount equal to 1-2/3 percent of their final rate (average of the highest 48 consecutive months' earnings during the last 10 years) of earnings, for each year of credited service up to 15 years, and 2 percent for each year thereafter. The monthly pension of a member hired before January 1, 2011, shall be increased annually by 3% of the original pension. Employees with at least 8 years of credited service may retire at or after age 55 and receive a reduced benefit. (1) Source: The City’s Comprehensive Annual Financial Report for the fiscal year ended April 30, 2013. 78 For participating members hired on or after January 1, 2011 who retire at or after age 67 with 10 years of service are entitled to an annual retirement benefit, payable monthly for life in an amount equal to 1- 2/3 percent of their final rate (average of the highest 96 consecutive months’ earnings during the last 10 years) of earnings, for each year of credited service, with a maximum salary cap of $106,800 at January 1, 2011. The maximum salary cap increases each year thereafter. The monthly pension of a member hired on or after January 1, 2011, shall be increased annually, following the later of the first anniversary date of retirement or the month following the attainment of age 62, by the lesser of 3% or ½ of the consumer price index. Employees with at least 10 years of credited service may retire at or after age 62 and receive a reduced benefit. IMRF also provides death and disability benefits. These benefit provisions and all other requirements are established by state statute. Employees participating in the plan are required to contribute 4.50 percent of their annual covered salary to IMRF. The employees’ contribution rate is established by state statute. The City is required to contribute the remaining amount necessary to fund the IMRF plan as specified by statute. For the calendar year 2012 the employer annual required contribution rate was 9.64 percent. Funding Progress(1) (6) Unfunded (Overfunded) (4) Actuarial (2) Unfunded Accrued (1) Actuarial (Overfunded) Liability as a Actuarial Actuarial Accrued (3) Actuarial (5) Percentage Valuation Value Liability Funded Accrued Annual of Covered Date of Plan (AAL) Ratio Liability Covered Payroll Dec. 31, Assets - Entry Age (1) ÷ (2) (2) - (1) Payroll (4) ÷ (5) 2007 ........... $4,137,504 $4,104,243 100.81% $ (33,261) $3,271,273 (1.02%) 2008 ........... 4,165,811 4,949,634 84.16% 783,823 3,694,367 21.22% 2009 ........... 4,322,149 5,008,192 86.30% 686,043 3,638,986 18.85% 2010 ........... 4,671,071 5,408,655 86.36% 737,584 3,235,515 22.80% 2011 ........... 4,416,393 5,169,646 85.43% 753,253 2,663,554 28.28% 2012 ........... 4,215,113 5,247,562 80.33% 1,032,449 2,518,404 41.00% Employer Contributions(1) Annual Fiscal Employer Required Percent Year Contributions Contribution Contributed 2008 ........... $248,944 $248,944 100.00% 2009 ........... 287,422 287,422 100.00% 2010 ........... 302,036 302,036 100.00% 2011 ........... 310,933 295,402 95.01% 2012 ........... 253,304 253,304 100.00% 2013 ........... 267,471 242,774 110.17% Police Pension Plan(1) The Police Pension Plan is a single-employer defined benefit pension plan that covers all sworn police personnel. Although this is a single-employer pension plan, the defined benefits and employee and employer contribution levels are governed by Illinois State Statutes and may be amended only by the Illinois legislature. The City accounts for the plan as a pension trust fund. (1) Source: The City’s Comprehensive Annual Financial Report for the fiscal year ended April 30, 2013. 79 At April 30, 2012, the date of the most recent actuarial valuation, the Police Pension Plan membership consisted of: Retirees and Beneficiaries Currently Receiving Benefits and Terminated Employees Entitled to Benefits but not yet Receiving Them ..................................................... 6 Current Employees Vested ............................................................................................ 13 Nonvested ........................................................................................ 12 31 The following is a summary of the Police Pension Plan as provided for in Illinois State Statutes. The Police Pension Plan provides retirement benefits as well as death and disability benefits. Covered employees hired before January 1, 2011, attaining the age of 50 or more with 20 or more years of creditable service are entitled to receive an annual retirement benefit of ½ of the salary attached to the rank held on the last day of service, or for one year prior to the last day, whichever is greater. The pension shall be increased by 2.5% of such salary for each additional year of service over 20 years up to 30 years, to a maximum of 75% of such salary. Covered employees hired on or after January 1, 2011, attaining the age of 55 with at least 10 years creditable service are entitled to receive an annual retirement benefit of 2.5% of final average salary for each year of service, with a maximum salary cap of $106,800 as of January 1, 2011. The maximum salary cap increases each year thereafter. The monthly benefit of a police officer hired before January 1, 2011, who retired with 20 or more years of service after January 1, 1977 shall be increased annually, following the first anniversary date of retirement and be paid upon reaching the age of at least 55 years, by 3% of the original pension and 3% compounded annually thereafter. The monthly pension of a police officer hired on or after January 1, 2011, shall be increased annually, following the later of the first anniversary date of retirement or the month following the attainment of age 60, but the lesser of 3% or ½ of the consumer price index. Employees with at least 10 years but less than 20 years of creditable service may retire at or after age 60 and receive a reduced benefit. Covered employees are required to contribute 9.91% of their base salary to the Police Pension Plan. If an employee leaves covered employment with less than 20 years of service, accumulated employee contributions may be refunded without accumulated interest. The City is required to contribute the remaining amounts necessary to finance the plan, including administrative costs, as actuarially determined by an enrolled actuary. By the year 2040 the City's contributions must accumulate to the point where the past service cost for the Police Pension Plan is 90% funded. Funding Progress(1) (6) Unfunded (Overfunded) (4) Actuarial (2) Unfunded Accrued (1) Actuarial (Overfunded) Liability as a Actuarial Actuarial Accrued (3) Actuarial (5) Percentage Valuation Value Liability Funded Accrued Annual of Covered Date of Plan (AAL) Ratio Liability Covered Payroll Apr, 30, Assets - Entry Age (1) ÷ (2) (2) - (1) Payroll (4) ÷ (5) 2007 ........... $2,156,875 $ 5,728,722 37.65% $3,571,847 $1,573,832 226.95% 2008 ........... 2,631,594 7,382,023 35.65% 4,750,429 1,789,042 265.53% 2009 ........... 2,759,119 8,272,076 33.35% 5,512,957 1,926,125 286.22% 2010 ........... 3,643,355 9,509,795 38.31% 5,866,440 1,819,957 322.34% 2011 ........... 4,216,855 10,393,520 40.57% 6,176,665 1,890,046 326.80% 2012 ........... 4,481,601 10,463,737 42.83% 5,982,136 1,694,445 353.04% (1) Source: The City’s Comprehensive Annual Financial Report for the fiscal year ended April 30, 2013. 80 Employer Contributions(1) Annual Fiscal Employer Required Percent Year Contributions Contribution Contributed 2008 ........... $275,144 $339,071 81.15% 2009 ........... 297,328 383,502 77.53% 2010 ........... 323,291 429,562 75.26% 2011 ........... 336,075 481,207 69.84% 2012 ........... 360,356 496,952 72.51% 2013 ........... 438,711 542,648 80.85% Summary of Significant Accounting Policies and Plan Asset Matters Basis of Accounting(1) The financial statements are prepared using the accrual basis of accounting. Employee and employer contributions are recognized as revenues when due, pursuant to formal commitments, as well as statutory or contractual requirements. Benefits and refunds are recognized when due and payable in accordance with the terms of the plan. Method Used to Value Investments(1) Investments are reported at fair value. Short-term investments are reported at cost, which approximates fair value. Securities traded on national exchanges are valued at the last reported sales price. Investments that do not have any established market, if any, are reported at estimated fair value. Significant Investments(1) At year-end, the Police Pension Fund has over 5 percent of net plan assets available for retirement benefits (other than U.S. Government guaranteed obligations) invested in Schwab S&P 500 Index Fund ($590,541). Information for IMRF is not available. Related Party Transactions(1) There are no securities of the employer or any other related parties included in plan assets. Annual Pension Cost and Net Pension Obligation(1) The pension liability for IMRF and the Police Pension Plan is as follows: Illinois Retirement Police Municipal Pension Total Annual Required Contribution ..................... $242,774 $542,648 $785,422 Interest on Net Pension Obligation ............... 1,190 42,369 43,559 Adjustment to Annual Required Contribution ....... 7,644 (41,331) (33,687) Annual Pension Cost ............................. 251,608 543,686 795,294 Actual Contribution ............................. 267,471 438,711 706,182 Change in NPO ................................... (15,863) 104,975 89,112 NPO - Beginning of Year ......................... 15,863 548,448 564,311 NPO - End of Year ............................... 0 653,423 653,423 (1) Source: The City’s Comprehensive Annual Financial Report for the fiscal year ended April 30, 2013. 81 The City’s annual pension cost for the current year and related information for each plan is as follows: Illinois Municipal Police Retirement Pension Contribution Rates Employer .................................................... 9.64% 20.23% Employee .................................................... 4.50% 9.91% Actuarial Valuation Date...................................... 12/31/2012 4/30/2012 Actuarial Cost Method ........................................ Entry Age Entry Age Normal Normal Amortization Method .......................................... Level % of Level % of Projected Payroll Projected Payroll Open Basis Closed Basis Remaining Amortization Period ................................. 30 Years 29 Years Asset Valuation Method ....................................... 5-Year Market Smoothed Market Actuarial Assumptions Investment Rate of Return .................................... 7.50% 7.50% Compounded Compounded Annually Annually Projected Salary Increases ................................... .4 to 10.0% 5.50% Inflation Rate Included...................................... 4.00% 3.00% Cost-of-Living Adjustments ................................... 3.00% 3.00% Trend Information(1) Employer annual pension cost (APC), actual contributions and the net pension obligation (NPO) are as follows. The NPO is the cumulative difference between the APC and the contributions actually made. Illinois Fiscal Retirement Police Year Municipal Pension Annual Pension Cost ............................. 2011 $310,933 $489,523 (APC) 2012 253,636 510,479 2013 251,608 543,686 Actual Contributions ............................ 2011 295,402 336,075 2012 253,304 360,356 2013 267,471 438.711 Percentage of APC ............................... 2011 95.01% 68.65% Contributed 2012 99.87% 70.59% 2013 106.30% 80.69% Net Pension Obligation .......................... 2011 15,531 398,325 2012 15,863 548,448 2013 0 653.423 (1) Source: The City’s Comprehensive Annual Financial Report for the fiscal year ended April 30, 2013. 82 Funded Status and Funding Progress(1) The City’s funded status for the current year and related information for each plan is as follows: Illinois Municipal Police Retirement Pension Actuarial Valuation Date...................................... 12/31/2012 4/30/2012 Percent Funded ............................................... 80.33% 42.80% Actuarial Accrued Liability for Benefits ................................................ $5,247,562 $10,463,737 Actuarial Value of Assets ..................................... $4,215,113 $4,481,601 Over (Under) Funded Actuarial Accrued Liability (UAAL) ..................................... ($1,032,449) ($5,982,136) Covered Payroll (Annual Payroll of Active Employees Covered by the Plan) ................................................ $2,518,404 $1,694,445 Ratio of UAAL to Covered Payroll ...................................................... 41.00% 353.04% The schedule of funding progress, presented as Required Supplementary Information (RSI) following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets are increasing or decreasing over time relative to the actuarial accrued liability for benefits. Plan Descriptions, Provisions, and Funding Policies(1) In addition to providing the pension benefits described, the City offers post-employment health care insurance benefits (OPEB) for its eligible retired employees through a single employer defined benefit plan. The benefits, benefit levels, employee contributions and employer contributions are governed by the City and can be amended by the City through its personnel manual and union contracts. The plan is not accounted for as a trust fund, as an irrevocable trust has not been established to account for the plan. The plan does not issue a separate report. The activity of the plan is reported in the City’s General Fund. The City offers post-employment health care benefits to its retirees. To be eligible for benefits, an employee must qualify for retirement under one of the City’s retirement plans. Current elected officials are eligible if they were elected/appointed prior to April, 2013. All health care benefits are provided through the City’s health insurance plan. The benefit levels are the same as those afforded to active employees. Benefits include general inpatient and outpatient medical services; mental, nervous, and substance abuse care; vision care; dental care; and prescriptions. Upon a retiree reaching 65 years of age, Medicare becomes the primary insurer and the City’s plan becomes secondary. All retirees contribute 100% of the actuarially determined premium to the plan, with the exception of two previous employees for which the City has agreed to pay portions of their post-employment health, dental and vision insurance. For the fiscal year ending April 30, 2013, retirees contributed $57,824 to the plan. Active employees do not contribute to the post-employment health care plan until retirement. At April 30, 2013, membership consisted of: Retirees and Beneficiaries Currently Receiving Benefits and Terminated Employees Entitled to Benefits but not yet Receiving Them ..................................................... 8 Active Employees ................................................................................ 78 Total ............................................................................................. 86 Participating Employers ........................................................................ 1 The City does not currently have a funding policy. (1) Source: The City’s Comprehensive Annual Financial Report for the fiscal year ended April 30, 2013. 83 Annual OPEB Costs and Net OPEB Obligation(1) The net OPEB obligation (NOPEBO) as of April 30, 2013, was calculated as follows: Annual Required Contribution ......................... $36,363 Interest on the Net OPEB Obligation .................. 473 Adjustment to the ARC ............................... (316) Annual OPEB Cost ..................................... $36,520 Actual Contribution .................................. 38,046 Increase in the net OPEB Obligation .................. $(1,526) Net OPEB Obligation - Beginning of Year .............. $ 9,453 Net OPEB Obligation - End of Year .................... $ 7,927 Trend Information(1) The City’s annual OPEB cost, actual contributions, the percentage of annual OPEB cost contributed and the net OPEB obligation are as follows: Annual Percentage Net Fiscal OPEB Actual of OPEB Obligation Year Cost Contributions Cost Contributed OPEB 2011 ....... $ 4,145 $ 1,814 43.76% $7,007 2012 ....... 4,260 1,814 42.58% 9,453 2013 ....... 36 250 38,046 104.18% 7,927 Funded Status and Funding Progress(1) Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents multiyear trend information that shows whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. The funded status of the plan as of April 30, 2012, the date of the latest actuarial valuation, was as follows: Actuarial Accrued Liability (AAL) .................... $ 566,488 Actuarial Value of Plan Assets ....................... - Unfunded Actuarial Accrued Liability (UAAL) .......... 566,488 Funded Ratio (Actuarial Value of Plan Assets/AAL) .... 0.00% Covered Payroll (Active Plan Members) ................ 4,553,600 UAAL as a Percentage of Covered Payroll .............. 12.44% Actuarial Methods and Assumptions(1) Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. (1) Source: The City’s Comprehensive Annual Financial Report for the fiscal year ended April 30, 2013. 84 In the April 30, 2012 actuarial valuation the entry age actuarial cost method was used. The actuarial assumptions included a 5.0% investment rate of return (net of administrative expenses) and an annual healthcare cost trend rate of 8.0%, with an ultimate rate of 6.0%. Both rates include a 3.0% inflation assumption. The actuarial value of assets was not determined as the City has not advance funded its obligation. The plan’s unfunded actuarial accrued liability is being amortized as a level percentage of projected payroll on an open basis. The remaining amortization period at April 30, 2013, was 30 years. Funding Progress(1) (6) Unfunded (Overfunded) (4) Actuarial (2) Unfunded Accrued (1) Actuarial (Overfunded) Liability as a Actuarial Actuarial Accrued (3) Actuarial (5) Percentage Valuation Value Liability Funded Accrued Annual of Covered Date of Plan (AAL) Ratio Liability Covered Payroll Apr, 30, Assets - Entry Age (1) ÷ (2) (2) - (1) Payroll (4) ÷ (5) 2008 ........... $N/A $ N/A N/A $ N/A $ N/A N/A 2009 ........... - 46,747 0.00% 46,747 5,483,409 0.85% 2010 ........... N/A N/A N/A N/A N/A N/A 2011 ........... N/A N/A N/A N/A N/A N/A 2012 ........... - 566,488 0.00% 566,488 4,553,600 12.44% Employer Contributions(1) Annual Fiscal Employer Required Percent Year Contributions Contribution Contributed 2008 ........... $ N/A $ N/A N/A 2009 ........... 1,814 4,159 43.62% 2010 ........... 1,814 4,145 43.76% 2011 ........... 1,814 4,145 43.76% 2012 ........... 1,814 4,144 43.77% 2013 ........... 38,046 36,363 104.63% The City implemented GASB Statement No. 45 for the fiscal year ended April 30, 2009, and had a subsequent actuarial valuation performed for the fiscal year ended April 30, 2012. Information for prior years is not available. The City is required to have an actuarial valuation performed triennially. See APPENDIX D herein for a discussion of the City’s employee retirement and other postemployment benefits obligations. REGISTRATION, TRANSFER AND EXCHANGE See also APPENDIX B for information on registration, transfer and exchange of book-entry bonds. The Bonds will be initially issued as book-entry bonds. The City shall cause books (the “Bond Register”) for the registration and for the transfer of the Bonds to be kept at the principal office maintained for the purpose by the Bond Registrar in Chicago, Illinois. The City will authorize to be prepared, and the Bond Registrar shall keep custody of, multiple bond blanks executed by the City for use in the transfer and exchange of Bonds. (1) Source: The City’s Comprehensive Annual Financial Report for the fiscal year ended April 30, 2013. 85 Any Bond may be transferred or exchanged, but only in the manner, subject to the limitations, and upon payment of the charges as set forth in the Bond Ordinance. Upon surrender for transfer or exchange of any Bond at the principal office maintained for the purpose by the Bond Registrar, duly endorsed by, or accompanied by a written instrument or instruments of transfer in form satisfactory to the Bond Registrar and duly executed by the registered owner or such owner’s attorney duly authorized in writing, the City shall execute and the Bond Registrar shall authenticate, date and deliver in the name of the registered owner, transferee or transferees (as the case may be) a new fully registered Bond or Bonds of the same maturity and interest rate of authorized denominations, for a like aggregate principal amount. The execution by the City of any fully registered Bond shall constitute full and due authorization of such Bond, and the Bond Registrar shall thereby be authorized to authenticate, date and deliver such Bond, provided, however, the principal amount of outstanding Bonds of each maturity authenticated by the Bond Registrar shall not exceed the authorized principal amount of Bonds for such maturity less Bonds previously paid. The Bond Registrar shall not be required to transfer or exchange any Bond following the close of business on the 15th day of the month next preceding any interest payment date on such Bond (known as the record date), nor to transfer or exchange any Bond after notice calling such Bond for redemption has been mailed, nor during a period of fifteen days next preceding mailing of a notice of redemption of any Bonds. The person in whose name any Bond shall be registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of the principal of or interest on any Bonds shall be made only to or upon the order of the registered owner thereof or such owner’s legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid. No service charge shall be made for any transfer or exchange of Bonds, but the City or the Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any transfer or exchange of Bonds except in the case of the issuance of a Bond or Bonds for the unredeemed portion of a Bond surrendered for redemption. TAX MATTERS In the opinion of Shanahan & Shanahan LLP, Bond Counsel, based on existing laws, regulations, rulings and court decisions, and assuming, among other matters, compliance with certain covenants, as described herein, interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986, as amended (the “Code”). In the further opinion of Bond Counsel, interest on the Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, but is included in adjusted current earnings in determining federal alternative minimum taxable income of corporations. A copy of the proposed form of the opinion of Shanahan & Shanahan LLP, as Bond Counsel, is set forth in APPENDIX C. Interest on the Bonds is not exempt from present Illinois income taxes. The Code imposes various restrictions, conditions and requirements relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the Bonds. The City has covenanted to comply with certain restrictions and requirements designed to assure that the interest on the Bonds will not be included in gross income for federal income tax purposes. Failure to comply with these covenants may result in such interest being included in gross income for federal income tax purposes, possibly from the original issuance date of the Bonds. The opinion of Shanahan & Shanahan LLP, as Bond Counsel, assumes compliance with these covenants. Bond Counsel has not undertaken to determine (or to inform any person) whether any actions taken (or not taken) or events occurring (or not occurring) after the issuance of the Bonds may adversely affect the tax status of the interest on the Bonds. 86 The opinion of Bond Counsel relies on factual representations made by the City and other persons. Bond Counsel has not verified these representations by independent investigation. Bond Counsel does not purport to be an expert in asset valuation and appraisal, financial analysis, financial projections or similar disciplines. Failure of any of these factual representations to be correct may result in interest on the Bonds being included in gross income for federal income tax purposes, possibly from the original issuance date of the Bonds. Certain requirements and procedures contained or referred to in the Bond Ordinance, the Tax Certificate relating to the Bonds and other relevant documents may be changed and certain actions may be taken or omitted under the circumstances and subject to the terms and conditions set forth in such documents. Bond Counsel expresses no opinion as to any Bond or the interest thereon if any such change occurs or action is taken or omitted upon the advice or approval of counsel other than Shanahan & Shanahan LLP. Although Bond Counsel is of the opinion that interest on the Bonds is excluded from gross income for federal income tax purposes, the ownership or disposition of, or the accrual or receipt of interest on, the Bonds may otherwise affect an owner’s federal tax liability. The nature and extent of these other tax consequences will depend upon the particular tax status of the owner or the owner’s other items of income or deduction. Bond Counsel expresses no opinion regarding any such other tax consequences except as expressly provided in the opinion of Bond Counsel. Bond Counsel gives no assurance that any future legislation or clarifications or amendments to the Code, if enacted into law, will not cause the interest on the Bonds to be subject, directly or indirectly, to federal income taxation, or otherwise prevent the owners from realizing the full current benefit of the tax status of the interest on the Bonds. Prospective purchasers of the Bonds are encouraged to consult their own tax advisors regarding any pending or proposed federal legislation, as to which Bond Counsel expresses no view. The opinion of Bond Counsel is based on current legal authorities, covers certain matters not directly addressed by such authorities, and represents Bond Counsel’s judgment regarding the proper treatment of the Bonds for federal income tax purposes. It is not binding on the IRS or the courts, and it is not a guarantee of result. Furthermore, Bond Counsel cannot give and has not given any opinion or assurance about the future activities of the City or about the effect of changes to the Code, the applicable regulations, the interpretation thereof or the enforcement thereof by the IRS. The City has covenanted, however, to comply with the applicable requirements of the Code. Bond Counsel is not obligated to defend the City regarding the tax-exempt status of the Bonds in the event of an examination by the IRS. Under current IRS procedures, the owners and other parties other than the City would have little, if any, right to participate in an IRS examination of the Bonds. Moreover, because obtaining judicial review in connection with an IRS examination of tax-exempt obligations is difficult, obtaining independent review of IRS positions with which the City legitimately disagrees may not be practicable. Any action of the IRS, including but not limited to selection of the Bonds for examination, or the course or result of such an examination, or an examination of Bonds presenting similar tax issues may affect the market price, or the marketability, of the Bonds, and may cause the City or the owners to incur significant expense. 87 Original Issue Discount To the extent the issue price of any maturity of the Bonds is less than the amount to be paid at maturity of such Bonds (excluding amounts stated to be interest and payable at least annually over the term of such Bonds), the difference constitutes “original issue discount,” the accrual of which, to the extent properly allocable to each owner thereof, is treated as interest on the Bonds which is excluded from gross income for federal income tax purposes. For this purpose, the issue price of a particular maturity of the Bonds is the first price at which a substantial amount of such maturity of Bonds is sold to the public (excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers). The original issue discount with respect to any maturity of the Bonds accrues daily over the term to maturity of such Bonds on the basis of a constant rate compounded on periodic compounding (with straight-line interpolations between compounding dates). In general, the length of the interval between periodic compounding dates cannot exceed the interval between debt service payments on such Bonds and must begin or end on the date of such payments. The accruing original issue discount is added to the adjusted basis of such Bonds to determine taxable gain or loss upon disposition (including sale, redemption, or payment on maturity) of such Bonds. Owners of the Bonds should consult with their own tax advisors with respect to the tax consequences of ownership of Bonds with original issue discount, including the treatment of purchasers who do not purchase such Bonds in the original offering to the public at the first price at which a substantial amount of such Bonds are sold to the public. Premium Bonds purchased, whether at original issuance or otherwise, for an amount greater than their principal amount payable at maturity (or, in some cases, at their earlier call date) (“Premium Bonds”) will be treated as having amortizable bond premium. No deduction is allowable for the amortizable bond premium in the case of Bonds, like the Premium Bonds, the interest on which is excluded from gross income for federal income tax purposes. However, the amount of tax exempt interest received, and an owner’s basis in a Premium Bond, will be reduced by the amount of amortizable bond premium properly allocable to such owner. Owners of Premium Bonds should consult their own tax advisors with respect to the proper treatment of amortizable bond premium in their particular circumstances. QUALIFIED TAX-EXEMPT OBLIGATIONS Subject to the City’s compliance with certain covenants, in the opinion of Bond Counsel, the Bonds are “qualified tax-exempt obligations” under the small issuer exception provided under Section 265(b)(3) of the Code, which affords banks and certain other financial institutions more favorable treatment of their deduction for interest expense than would otherwise be allowed under Section 265(b)(2) of the Code. 88 CONTINUING DISCLOSURE The City will enter into a Continuing Disclosure Undertaking (the “Undertaking”) for the benefit of the beneficial owners of the Bonds to send certain information annually and to provide notice of certain events to the Municipal Securities Rulemaking Board (the “MSRB”) pursuant to the requirements of Section (b)(5) of Rule 15c2-12 (the “Rule”) adopted by the Securities and Exchange Commission (the “Commission”) under the Securities Exchange Act of 1934. No person, other than the City, has undertaken, or is otherwise expected, to provide continuing disclosure with respect to the Bonds. The information to be provided on an annual basis, the events which will be noticed on an occurrence basis and a summary of other terms of the Undertaking, including termination, amendment and remedies, are set forth below under “THE UNDERTAKING.” The City has represented that it has not failed to comply in all material respects with each and every undertaking previously entered into by it pursuant to the Rule. However, the City failed to file its audited financial statements for 2008 and 2010 fiscal years within the time periods specified in prior continuing disclosure undertakings. As of the date of this Final Official Statement, the City has filed such audited financial statements. The City has established procedures to ensure that such audited financial statements will be filed in a timely manner in the future. Also a certain material event disclosure pertaining to bond and certificate insurance rating change required in prior undertakings was not submitted within the time frame required in the prior undertakings. On April 5, 2013, this material event disclosure was filed with the MSRB through EMMA. A failure by the City to comply with the Undertaking will not constitute a default under the Bond Ordinance and beneficial owners of the Bonds are limited to the remedies described in the Undertaking. See “THE UNDERTAKING - Consequences of Failure of the City to Provide Information.” The City must report any failure to comply with the Undertaking in accordance with the Rule. Any broker, dealer or municipal securities dealer must consider such report before recommending the purchase or sale of the Bonds in the secondary market. Consequently, such a failure may adversely affect the transferability and liquidity of the Bonds and their market price. Bond Counsel expresses no opinion as to whether the Undertaking complies with the requirements of Section (b)(5) of the Rule. THE UNDERTAKING The following is a brief summary of certain provisions of the Undertaking of the City and does not purport to be complete. The statements made under this caption are subject to the detailed provisions of the Undertaking, a copy of which is available upon request from the City. Annual Financial Information Disclosure The City covenants that it will disseminate its Annual Financial Information and its Audited Financial Statements, if any (as described below) to the MSRB in such manner and format and accompanied by identifying information as is prescribed by the MSRB or the Commission at the time of delivery of such information within 210 days after the last day of the City’s fiscal year (currently on April 30). If Audited Financial Statements are not available when the Annual Financial Information is filed, the City will file unaudited financial statements. The City will submit Audited Financial Statements to MSRB’s Electronic Municipal Market Access (“EMMA”) system within 30 days after availability to the City. MSRB Rule G-32 requires all EMMA filings to be in word-searchable PDF format. This requirement extends to all documents to be filed with EMMA, including financial statements and other externally prepared reports. 89 “Annual Financial Information” means • The table under the heading of Retailers’ Occupation, Service Occupation and Use Tax within this Final Official Statement; • All of the tables under the heading PROPERTY ASSESSMENT AND TAX INFORMATION within this Final Official Statement; • All of the tables under the heading DEBT INFORMATION within this Final Official Statement; and • All of the tables under the heading FINANCIAL INFORMATION within this Final Official Statement. “Audited Financial Statements” means financial statements of the City as audited annually by independent certified public accountants. Audited Financial Statements are expected to continue to be prepared according to Generally Accepted Accounting Principles as applicable to governmental units (i.e., as subject to the pronouncements of the Governmental Accounting Standards Board and subject to any express requirements of State law). Reportable Events Disclosure The City covenants that it will disseminate in a timely manner (not in excess of ten business days after the occurrence of the Reportable Event) Reportable Events Disclosure to the MSRB in such manner and format and accompanied by identifying information as is prescribed by the MSRB or the Commission at the time of delivery of such information. MSRB Rule G-32 requires all EMMA filings to be in word-searchable PDF format. This requirement extends to all documents to be filed with EMMA, including financial statements and other externally prepared reports. The “Reportable Events” are: 1. Principal and interest payment delinquencies 2. Non-payment related defaults, if material 3. Unscheduled draws on debt service reserves reflecting financial difficulties 4. Unscheduled draws on credit enhancements reflecting financial difficulties 5. Substitution of credit or liquidity providers, or their failure to perform 6. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the security, or other material events affecting the tax status of the security 7. Modifications to the rights of security holders, if material 8. Bond calls, if material, and tender offers 9. Defeasances 10. Release, substitution or sale of property securing repayment of the securities, if material 11. Rating changes 12. Bankruptcy, insolvency, receivership or similar event of the City* 13. The consummation of a merger, consolidation, or acquisition involving the City or the sale of all or substantially all of the assets of the City, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material 14. Appointment of a successor or additional trustee or the change of name of a trustee, if material. * This event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for the City in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the City, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the City. 90 Consequences of Failure of the City to Provide Information The City shall give notice in a timely manner to the MSRB of any failure to provide disclosure of Annual Financial Information and Audited Financial Statements when the same are due under the Undertaking. In the event of a failure of the City to comply with any provision of the Undertaking, the beneficial owner of any Bond may seek mandamus or specific performance by court order, to cause the City to comply with its obligations under the Undertaking. A default under the Undertaking shall not be deemed a default under the Bond Ordinance, and the sole remedy under the Undertaking in the event of any failure of the City to comply with the Undertaking shall be an action to compel performance. Amendment; Waiver Notwithstanding any other provision of the Undertaking, the City by resolution or ordinance authorizing such amendment or waiver, may amend the Undertaking, and any provision of the Undertaking may be waived, if: (a) (i) The amendment or the waiver is made in connection with a change in circumstances that arises from a change in legal requirements, including, without limitation, pursuant to a “no-action” letter issued by the Commission, a change in law, or a change in the identity, nature, or status of the City, or type of business conducted; or (ii) The Undertaking, as amended, or the provision, as waived, would have complied with the requirements of the Rule at the time of the primary offering, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (b) The amendment or waiver does not materially impair the interests of the beneficial owners of the Bonds, as determined by parties unaffiliated with the City (such as Bond Counsel). In the event that the Commission or the MSRB or other regulatory authority approves or requires Annual Financial Information or notices of a Reportable Event to be filed with a central post office, governmental agency or similar entity other than the MSRB or in lieu of the MSRB, the City shall, if required, make such dissemination to such central post office, governmental agency or similar entity without the necessity of amending the Undertaking. Termination of Undertaking The Undertaking shall be terminated if the City shall no longer have any legal liability for any obligation on or relating to repayment of the Bonds under the Bond Ordinance. The City shall give notice to the MSRB in a timely manner if this paragraph is applicable. Additional Information Nothing in the Undertaking shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in the Undertaking or any other means of communication, or including any other information in any Annual Financial Information or Audited Financial Statements or notice of occurrence of a Reportable Event, in addition to that which is required by the Undertaking. If the City chooses to include any information from any document or notice of occurrence of a Reportable Event in addition to that which is specifically required by the Undertaking, the City shall have no obligation under the Undertaking to update such information or include it in any future disclosure or notice of occurrence of a Reportable Event. 91 Dissemination of Information; Dissemination Agent When filings are required to be made with the MSRB in accordance with the Undertaking, such filings are required to be made through its EMMA system for municipal securities disclosure or through any other electronic format or system prescribed by the MSRB for purposes of the Rule. The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under the Undertaking, and may discharge any such Agent, with or without appointing a successor Dissemination Agent. OPTIONAL REDEMPTION The Bonds are callable in whole or in part on any date on or after December 1, 2023, at a price of par and accrued interest. If less than all the Bonds are called, they shall be redeemed in such principal amounts and from such maturities as determined by the City and within any maturity by lot. The Bond Registrar will give notice of redemption, identifying the Bonds (or portions thereof) to be redeemed, by mailing a copy of the redemption notice by first class mail not less than thirty (30) days nor more than sixty (60) days prior to the date fixed for redemption to the registered owner of each Bond (or portion thereof) to be redeemed at the address shown on the registration books maintained by the Bond Registrar. Unless moneys sufficient to pay the redemption price of the Bonds to be redeemed are received by the Bond Registrar prior to the giving of such notice of redemption, such notice may, at the option of the City, state that said redemption will be conditional upon the receipt of such moneys by the Bond Registrar on or prior to the date fixed for redemption. If such moneys are not received, such notice will be of no force and effect, the City will not redeem such Bonds, and the Bond Registrar will give notice, in the same manner in which the notice of redemption has been given, that such moneys were not so received and that such Bonds will not be redeemed. Otherwise, prior to any redemption date, the City will deposit with the Bond Registrar an amount of money sufficient to pay the redemption price of all the Bonds or portions of Bonds which are to be redeemed on the date. Subject to the provisions for a conditional redemption described above, notice of redemption having been given as described above and in the Bond Ordinance, the Bonds or portions of Bonds so to be redeemed will, on the redemption date, become due and payable at the redemption price therein specified, and from and after such date (unless the City shall default in the payment of the redemption price) such Bonds or portions of Bonds shall cease to bear interest. Upon surrender of such Bonds for redemption in accordance with said notice, such Bonds will be paid by the Bond Registrar at the redemption price. LITIGATION There is no litigation of any nature now pending or threatened restraining or enjoining the issuance, sale, execution or delivery of the Bonds, or in any way contesting or affecting the validity of the Bonds or any proceedings of the City taken with respect to the issuance or sale thereof. FINAL OFFICIAL STATEMENT AUTHORIZATION This Final Official Statement has been authorized for distribution to prospective purchasers of the Bonds. All statements, information, and statistics herein are believed to be correct but are not guaranteed by the consultants or by the City, and all expressions of opinion, whether or not so stated, are intended only as such. 92 INVESTMENT RATING The Bonds have been rated “AA-“ (Stable Outlook) from Standard & Poor’s, a Division of the McGraw-Hill Companies. The City has supplied certain information and material concerning the Bonds and the City to the rating service shown on the cover page, including certain information and materials which may not have been included in this Final Official Statement, as part of its application for an investment rating on the Bonds. A rating reflects only the views of the rating agencies assigning such rating and an explanation of the significance of such rating may be obtained from such rating agencies. Generally, each rating service bases its rating on such information and material, and also on such investigations, studies and assumptions that it may undertake independently. There is no assurance that such rating will continue for any given period of time or that it may not be lowered or withdrawn entirely by such rating service if, in its judgment, circumstances so warrant. Any such downward change in or withdrawal of such rating may have an adverse effect on the secondary market price of the Bonds. An explanation of the significance of the investment rating may be obtained from the rating agency: Standard & Poor’s Corporation, 55 Water Street, New York, New York 10041, telephone 212-438-2000. The City will provide appropriate periodic credit information to the rating service to maintain a rating on the Bonds. CERTAIN LEGAL MATTERS Certain legal matters incident to the authorization, issuance and sale of the Bonds are subject to the approving legal opinion of Shanahan & Shanahan LLP, Chicago, Illinois, as Bond Counsel (the “Bond Counsel”) who has been retained by, and acts as, Bond Counsel to the City. Bond Counsel has not been retained or consulted on disclosure matters and has not undertaken to review or verify the accuracy, completeness or sufficiency of this Final Official Statement or other offering material relating to the Bonds and assumes no responsibility for the statements or information contained in or incorporated by reference in this Final Official Statement, except that in its capacity as Bond Counsel, Shanahan & Shanahan LLP, Chicago, Illinois, has, at the request of the City reviewed only those sections of this Final Official Statement involving the description of the Bonds, the security for the Bonds and the description of the federal tax exemption of interest on the Bonds. This review was undertaken solely at the request and for the benefit of the City and did not include any obligation to establish or confirm factual matters set forth herein. Certain legal matters will be passed upon for the Underwriter by Miller, Canfield, Paddock and Stone, P.L.C., Chicago, Illinois. DEFEASANCE The Bonds are subject to legal defeasance by the irrevocable deposit of full faith and credit obligations of the United States of America, obligations the timely payment of which are guaranteed by the United States Treasury, or certificates of participation in a trust comprised solely of full faith and credit obligations of the United States of America (collectively, the “Government Obligations”) with a bank or trust company acting as escrow agent. Any such deposit must be of sufficient amount that the receipts from the Government Obligations plus any cash on deposit will be sufficient to pay debt service on the Bonds when due or as called for redemption. UNDERWRITING Bernardi Securities, Inc., Chicago, Illinois (the “Underwriter”) has agreed to purchase all but not less than all of the Bonds at a price of $1,225,226.55 (reflecting the par amount of $1,235,000, plus a reoffering premium of $5,664.05, and an Underwriter’s Discount of $15,437.50). It is anticipated that delivery of the Bonds will occur on the date shown on the cover page hereof. The Bonds may be offered and sold to certain dealers (including the Underwriter or other dealers depositing Bonds into investment trusts) at prices or yields other than such public offering prices or yields shown on the cover page to this Final Official Statement, and such public offering prices or yields may be changed, from time to time, by the Underwriter. 93 FINANCIAL ADVISOR The City has engaged Speer Financial, Inc. as financial advisor (the “Financial Advisor”) in connection with the issuance and sale of the Bonds. The Financial Advisor will not participate in the underwriting of the Bonds. The financial information included in the Final Official Statement has been compiled by the Financial Advisor. Such information does not purport to be a review, audit or certified forecast of future events and may not conform with accounting principles applicable to compilations of financial information. The Financial Advisor is not a firm of certified public accountants and does not serve in that capacity or provide accounting services in connection with the Bonds. The Financial Advisor is not obligated to undertake any independent verification of or to assume any responsibility for the accuracy, completeness or fairness of the information contained in this Final Official Statement, nor is the Financial Advisor obligated by the City’s continuing disclosure undertaking. CERTIFICATION We have examined this Final Official Statement dated December 10, 2013, for the $1,235,000 General Obligation (Alternate Revenue Source) Refunding Bonds, Series 2014, believe it to be true and correct and will provide to the purchaser of the Bonds at the time of delivery a certificate confirming to the purchaser that to the best of our knowledge and belief information in the Official Statement was at the time of delivery of the Bonds true and correct in all material respects and does not include any untrue statement of a material fact, nor does it omit the statement of any material fact required to be stated therein, or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. /s/ GARY J. GOLINSKI /s/ ROB FREDRICKSON Mayor Finance Director UNITED CITY OF YORKVILLE UNITED CITY OF YORKVILLE Kendall County, Illinois Kendall County, Illinois 94 APPENDIX A UNITED CITY OF YORKVILLE KENDALL COUNTY, ILLINOIS EXCERPTS OF FISCAL YEAR 2013 AUDITED FINANCIAL STATEMENTS 95 Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S St a t e m e n t o f N e t P o s i t i o n Ap r i l 3 0 , 2 0 1 3 Bu s i n e s s - Ty p e Ac t i v i t i e s T o t a l s Cu r r e n t A s s e t s Ca s h a n d I n v e s t m e n t s $ 7 , 7 5 2 , 4 3 5 3 , 4 1 4 , 8 6 6 1 1 , 1 6 7 , 3 0 1 Re c e i v a b l e s - N e t 7 , 3 6 4 , 6 3 3 7 7 7 , 2 8 7 8 , 1 4 1 , 9 2 0 Pr e p a i d s 1 7 4 , 5 7 1 5 6 , 6 3 3 2 3 1 , 2 0 4 In t e r n a l B a l a n c e s ( 2 5 9 , 4 4 7 ) 2 5 9 , 4 4 7 - Du e f r o m O t h e r G o v e r n m e n t s 1 5 - 1 5 To t a l C u r r e n t A s s e t s 1 5 , 0 3 2 , 2 0 7 4 , 5 0 8 , 2 3 3 1 9 , 5 4 0 , 4 4 0 No n c u r r e n t A s s e t s Ca p i t a l A s s e t s No n d e p r e c i a b l e C a p i t a l A s s e t s 3 1 , 0 2 0 , 4 3 0 1 , 5 5 7 , 2 2 7 3 2 , 5 7 7 , 6 5 7 De p r e c i a b l e C a p i t a l A s s e t s 6 6 , 5 2 8 , 7 1 9 6 8 , 4 3 2 , 9 1 6 1 3 4 , 9 6 1 , 6 3 5 Ac c u m u l a t e d D e p r e c i a t i o n ( 2 1 , 7 0 5 , 8 1 0 ) ( 1 0 , 8 4 0 , 0 4 6 ) ( 3 2 , 5 4 5 , 8 5 6 ) To t a l C a p i t a l A s s e t s 7 5 , 8 4 3 , 3 3 9 5 9 , 1 5 0 , 0 9 7 1 3 4 , 9 9 3 , 4 3 6 Ot h e r A s s e t s As s e t s H e l d f o r O t h e r s - 1 1 , 0 9 1 , 0 0 0 1 1 , 0 9 1 , 0 0 0 To t a l N o n c u r r e n t A s s e t s 7 5 , 8 4 3 , 3 3 9 7 0 , 2 4 1 , 0 9 7 1 4 6 , 0 8 4 , 4 3 6 To t a l A s s e t s 9 0 , 8 7 5 , 5 4 6 7 4 , 7 4 9 , 3 3 0 1 6 5 , 6 2 4 , 8 7 6 Un a m o r t i z e d L o s s o n R e f u n d i n g - 3 9 5 , 2 2 5 3 9 5 , 2 2 5 To t a l A s s e t s a n d D e f e r r e d O u t f l o w s o f R e s o u r c e s 9 0 , 8 7 5 , 5 4 6 7 5 , 1 4 4 , 5 5 5 1 6 6 , 0 2 0 , 1 0 1 Go v e r n m e n t a l Ac t i v i t i e s AS S E T S DE F E R R E D O U T F L O W S O F R E S O U R C E S Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . Business-Type ActivitiesTotals Cu r r e n t L i a b i l i t i e s Ac c o u n t s P a y a b l e 8 1 9 , 0 2 3 9 1 , 2 8 5 9 1 0 , 3 0 8 De p o s i t s P a y a b l e 2 8 9 , 4 1 8 1 7 , 9 5 3 3 0 7 , 3 7 1 Ac c r u e d P a y r o l l 1 3 7 , 1 7 8 1 9 , 6 0 3 1 5 6 , 7 8 1 Ac c r u e d I n t e r e s t P a y a b l e 1 9 9 , 0 3 8 3 6 5 , 1 1 3 5 6 4 , 1 5 1 Ot h e r L i a b i l i t i e s 2 8 8 , 1 3 9 - 2 8 8 , 1 3 9 Ot h e r P a y a b l e s 8 7 , 0 1 5 1 , 8 3 6 8 8 , 8 5 1 Cu r r e n t P o r t i o n o f L o n g - T e r m D e b t 9 2 8 , 1 2 2 2 , 0 2 4 , 7 0 4 2 , 9 5 2 , 8 2 6 To t a l C u r r e n t L i a b i l i t i e s 2 , 7 4 7 , 9 3 3 2 , 5 2 0 , 4 9 4 5 , 2 6 8 , 4 2 7 No n c u r r e n t L i a b i l i t i e s Co m p e n s a t e d A b s e n c e s P a y a b l e 2 4 4 , 4 4 0 3 5 , 1 6 6 2 7 9 , 6 0 6 Ne t P e n s i o n O b l i g a t i o n P a y a b l e 6 5 3 , 4 2 3 - 6 5 3 , 4 2 3 Ne t O t h e r P o s t - E m p l o y m e n t B e n e f i t P a y a b l e 7 , 9 2 7 - 7 , 9 2 7 No t e s P a y a b l e 8 2 3 , 5 8 9 - 8 2 3 , 5 8 9 IE P A L o a n s P a y a b l e - 1 , 8 8 0 , 0 8 4 1 , 8 8 0 , 0 8 4 Ge n e r a l O b l i g a t i o n B o n d s P a y a b l e 1 2 , 1 9 0 , 0 0 0 1 6 , 8 5 5 , 0 0 0 2 9 , 0 4 5 , 0 0 0 De b t C e r t i f i c a t e s P a y a b l e - 6 , 6 8 0 , 0 0 0 6 , 6 8 0 , 0 0 0 Ot h e r L i a b i l i t i e s 1 , 8 9 0 1 , 9 5 2 , 5 3 4 1 , 9 5 4 , 4 2 4 To t a l N o n c u r r e n t L i a b i l i t i e s 1 3 , 9 2 1 , 2 6 9 2 7 , 4 0 2 , 7 8 4 4 1 , 3 2 4 , 0 5 3 To t a l L i a b il i t i e s 16,669,20229,923,27846,592,480 Pr o p e r t y a n d S t a t e T a x e s 5 , 3 6 4 , 6 1 2 - 5 , 3 6 4 , 6 1 2 To t a l L i a b i l i t i e s a n d D e f e r r e d I n f l o w s o f R e s o u r c e s 2 2 , 0 3 3 , 8 1 4 2 9 , 9 2 3 , 2 7 8 5 1 , 9 5 7 , 0 9 2 Ne t I n v e s t m e n t i n C a p i t a l A s s e t s 6 1 , 9 6 2 , 7 3 8 3 1 , 7 1 9 , 1 0 0 9 3 , 6 8 1 , 8 3 8 Re s t r i c t e d Li b r a r y O p e r a t i o n s 453,630-453,630 Sp e c i a l S e r v i c e A r e a s 22,864-22,864 Mo t o r F u e l T a x 1,152,348-1,152,348 La n d C a s h 121,420-121,420 Ta x I n c r e m e n t F i n a n c i n g D i s t r i c t s 1,787,605-1,787,605 Un r e s t r i c t e d 3,341,12713,502,17716,843,304 To t a l N e t P o s i t i o n 68,841,73245,221,277114,063,009 LI A B I L I T I E S NE T P O S I T I O N Go v e r n m e n t a l Activities DE F E R R E D I N F L O W S O F R E S O U R C E S 96 Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S St a t e m e n t o f A c t i v i t i e s Ye a r E n d e d A p r i l 3 0 , 2 0 1 3 Ch a r g e s O p e r a t i n g C a p i t a l fo r Gr a n t s / G r a n t s / Se r v i c e s C o n t r i b u ti o n s C o n t r i b u t i o n s Go v e r n m e n t a l A c t i v i t i e s Ge n e r a l G o v e r n m e n t $ 3 , 1 2 1 , 8 5 7 1 , 7 5 1 , 3 0 9 6 1 , 6 3 5 - Li b r a r y 93 2 , 7 4 8 5 8 , 7 9 4 2 4 , 1 2 3 - Pa r k s a n d R e c r e a t i o n 1, 8 1 2 , 4 8 3 2 6 5 , 6 1 4 7 4 , 3 3 7 4 0 0 , 0 0 0 Pu b l i c S a f e t y 3, 7 5 0 , 3 1 8 - - - Co m m u n i t y D e v e l o p m e n t 35 6 , 6 8 9 - - - Pu b l i c W o r k s 2, 9 8 3 , 2 0 0 - 53 5 , 9 6 3 2 , 9 1 7 , 2 5 6 In t e r e s t o n L o n g - T e r m D e b t 69 1 , 5 5 1 - - - To t a l G o v e r n m e n t a l A c t i v i t i e s 1 3 , 6 4 8 , 8 4 6 2 , 0 7 5 , 7 1 7 6 9 6 , 0 5 8 3 , 3 1 7 , 2 5 6 Bu s i n e s s - T y p e A c t i v i t i e s Se w e r 1, 6 3 0 , 0 2 3 1 , 3 5 8 , 4 2 0 - 3, 3 4 3 , 3 5 1 Wa t e r 2, 6 3 8 , 2 5 2 2 , 8 2 3 , 3 5 7 - 1, 4 8 6 , 1 4 0 Re c r e a t i o n C e n t e r 59 2 , 7 0 7 4 9 3 , 6 1 7 - - To t a l B u s i n e s s - T y p e A c t i v i t i e s 4 , 8 6 0 , 9 8 2 4 , 6 7 5 , 3 9 4 - 4, 8 2 9 , 4 9 1 18 , 5 0 9 , 8 2 8 6 , 7 5 1 , 1 1 1 6 9 6 , 0 5 8 8 , 1 4 6 , 7 4 7 Ge n e r a l R e v e n u e s T a x e s P r o p e r t y T a x e s U t i l i t y T a x e s O t h e r T a x e s I n t e r g o v e r n m e n t a l - U n r e s t r i c t e d S a l e s T a x e s I n c o m e T a x e s I n t e r e s t I n c o m e M i s c e l l a n e o u s Ch a n g e i n N e t P o s i t i o n Ne t P o s i t i o n - B e g i n n i n g a s R e s t a t e d Ne t P o s i t i o n - E n d i n g Ex p e n s e s Pr o g r a m R e v e n u e s Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . Bu s i n e s s Go v e r n m e n t a l Ty p e Ac t i v i t i e s Ac t i v i t i e s To t a l s (1 , 3 0 8 , 9 1 3 ) - (1 , 3 0 8 , 9 1 3 ) (8 4 9 , 8 3 1 ) - (8 4 9 , 8 3 1 ) (1 , 0 7 2 , 5 3 2 ) - (1 , 0 7 2 , 5 3 2 ) (3 , 7 5 0 , 3 1 8 ) - (3 , 7 5 0 , 3 1 8 ) (3 5 6 , 6 8 9 ) - (3 5 6 , 6 8 9 ) 47 0 , 0 1 9 - 47 0 , 0 1 9 (6 9 1 , 5 5 1 ) - (6 9 1 , 5 5 1 ) (7 , 5 5 9 , 8 1 5 ) - (7 , 5 5 9 , 8 1 5 ) - 3, 0 7 1 , 7 4 8 3, 0 7 1 , 7 4 8 - 1, 6 7 1 , 2 4 5 1, 6 7 1 , 2 4 5 - (9 9 , 0 9 0 ) (9 9 , 0 9 0 ) - 4, 6 4 3 , 9 0 3 4, 6 4 3 , 9 0 3 (7 , 5 5 9 , 8 1 5 ) 4, 6 4 3 , 9 0 3 (2 , 9 1 5 , 9 1 2 ) 4, 7 4 3 , 5 9 9 15 5 , 9 9 9 4, 8 9 9 , 5 9 8 1, 5 5 3 , 6 9 3 - 1, 5 5 3 , 6 9 3 92 2 , 4 3 9 - 92 2 , 4 3 9 4, 4 0 9 , 9 2 6 - 4, 4 0 9 , 9 2 6 1, 5 8 7 , 3 2 4 - 1, 5 8 7 , 3 2 4 16 , 3 6 8 9, 5 4 2 25 , 9 1 0 65 2 , 6 0 6 10 2 , 8 5 9 75 5 , 4 6 5 13 , 8 8 5 , 9 5 5 26 8 , 4 0 0 14 , 1 5 4 , 3 5 5 6, 3 2 6 , 1 4 0 4, 9 1 2 , 3 0 3 11 , 2 3 8 , 4 4 3 62 , 5 1 5 , 5 9 2 40 , 3 0 8 , 9 7 4 10 2 , 8 2 4 , 5 6 6 68 , 8 4 1 , 7 3 2 45 , 2 2 1 , 2 7 7 11 4 , 0 6 3 , 0 0 9 Pr i m a r y G o v e r n m e n t Ne t E x p e n s e / R e v e n u e 97 Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S Ba l a n c e S h e e t - G o v e r n m e n t a l F u n d s Ap r i l 3 0 , 2 0 1 3 Ca s h a n d I n v e s t m e n t s $ 3 , 1 3 9 , 7 5 5 Re c e i v a b l e s - N e t o f A l l o w a n c e s Pr o p e r t y T a x e s 2, 9 5 0 , 6 9 2 Ac c o u n t s 20 5 , 5 9 9 Ot h e r T a x e s 2, 3 2 8 , 0 4 0 Du e f r o m O t h e r G o v e r n m e n t s 15 Du e f r o m O t h e r F u n d s - Pr e p a i d s 13 9 , 9 8 5 To t a l A s s e t s 8, 7 6 4 , 0 8 6 Ac c o u n t s P a y a b l e 58 6 , 7 5 8 De p o s i t P a y a b l e 27 1 , 3 6 5 Ac c r u e d P a y r o l l 10 0 , 0 2 5 Ot h e r L i a b i l i t i e s Du e t o O t h e r F u n d s 17 , 4 4 8 Ot h e r P a y a b l e s - To t a l L i a b i l i t i e s 97 5 , 5 9 6 Pr o p e r t y a n d S t a t e T a x e s 3, 5 6 4 , 6 7 0 To t a l L i a b i l i t i e s a n d D e f e r r e d I n f l o w s o f R e s o u r c e s 4, 5 4 0 , 2 6 6 No n s p e n d a b l e 13 9 , 9 8 5 Re s t r i c t e d - Co m m i t t e d - As s i g n e d - Un a s s i g n e d 4, 0 8 3 , 8 3 5 To t a l F u n d B a l a n c e s 4, 2 2 3 , 8 2 0 To t a l L i a b i l i t i e s , D e f e r r e d I n f l o w s o f R e s o u r c e s an d F u n d B a l a n c e s 8, 7 6 4 , 0 8 6 FU N D B A L A N C E S LI A B I L I T I E S Ge n e r a l AS S E T S DE F E R R E D I N F L O W S O F R E S O U R C E S Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . Pa r k s a n d Lib r a r y R e c r e a t i o n N o n m a j o r T o t a l s 49 0 , 4 6 8 1 4 8 , 7 6 1 3 , 9 7 3 , 4 5 1 7 , 7 5 2 , 4 3 5 1, 4 7 1 , 7 6 3 - 3 2 8 , 1 7 9 4 , 7 5 0 , 6 3 4 - 5, 5 0 0 44,704255,803 1, 0 5 6 - 2 9 , 1 0 0 2 , 3 5 8 , 1 9 6 -- - 1 5 - 3 1 7 , 2 8 0 3 9 , 0 3 6 3 5 6 , 3 1 6 8, 1 9 5 1 4 , 5 6 6 1 1 , 8 2 5 1 7 4 , 5 7 1 1, 9 7 1 , 4 8 2 48 6 , 1 0 7 4,426,29515,647,970 20 , 9 4 9 36 , 3 9 7 174,919819,023 - 18 , 0 5 3 -289,418 12 , 8 8 1 24 , 2 7 2 -137,178 4, 0 6 4 - 284,075288,139 - - 598,315615,763 - 87 , 0 1 5 -87,015 37 , 8 9 4 16 5 , 7 3 7 1,057,3092,236,536 1, 4 7 1 , 7 6 3 - 328,1795,364,612 1, 5 0 9 , 6 5 7 16 5 , 7 3 7 1,385,4887,601,148 8, 1 9 5 14 , 5 6 6 11,825174,571 45 3 , 6 3 0 - 3,096,2833,549,913 - 30 5 , 8 0 4 -305,804 - - 504,314504,314 - - (571,615)3,512,220 46 1 , 8 2 5 32 0 , 3 7 0 3,040,8078,046,822 1, 9 7 1 , 4 8 2 48 6 , 1 0 7 4,426,29515,647,970 Sp e c i a l R e v e n u e 98 The notes to the financial statements are an integral part of this statement. UNITED CITY OF YORKVILLE, ILLINOIS Reconciliation of Total Governmental Fund Balance to Net Position of Governmental Activities April 30, 2013 Total Governmental Fund Balances $8,046,822 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.75,843,339 Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the funds. Accrued Interest Payable (199,038) Compensated Absences Payable (305,550) Net Pension Obligation Payable (653,423) Net Other Post-Employment Benefit Obligation Payable (7,927) Notes Payable (855,601) General Obligation Bonds Payable (13,025,000) Other Obligations Payable (1,890) Net Position of Governmental Activities 68,841,732 99 Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S St a t e m e n t o f R e v e n u e s , E x p e n d i t u r e s a n d C h a n g e s i n F u n d B a l a n c e s - G o v e r n m e n t a l F u n d s Ye a r E n d e d A p r i l 3 0 , 2 0 1 3 Re v e n u e s Ta x e s $ 9 , 3 1 7 , 3 8 3 In t e r g o v e r n m e n t a l 2, 0 6 0 , 7 3 8 Li c e n s e s , P e r m i t s a n d F e e s 16 8 , 8 3 1 Ch a r g e s f o r S e r v i c e s 1, 1 9 9 , 9 0 8 Fi n e s a n d F o r f e i t s 16 9 , 1 4 4 Gr a n t s a n d D o n a t i o n s - In t e r e s t 7, 2 8 7 Mi s c e l l a n e o u s 39 1 , 5 1 9 To t a l R e v e n u e s 13 , 3 1 4 , 8 1 0 Ex p e n d i t u r e s Cu r r e n t Ge n e r a l G o v e r n m e n t 3, 2 9 6 , 3 7 9 Li b r a r y - Pa r k s a n d R e c r e a t i o n - Pu b l i c S a f e t y 3, 5 5 0 , 9 5 5 Co m m u n i t y D e v e l o p m e n t 36 5 , 1 8 8 Pu b l i c W o r k s 1, 6 4 7 , 5 8 9 Ca p i t a l O u t l a y - De b t S e r v i c e Pr i n c i p a l R e t i r e m e n t - In t e r e s t a n d F i s c a l C h a r g e s - To t a l E x p e n d i t u r e s 8, 8 6 0 , 1 1 1 Ex c e s s ( D e f i c i e n c y ) o f R e v e n u e s Ov e r ( U n d e r ) E x p e n d i t u r e s 4, 4 5 4 , 6 9 9 Ot h e r F i n a n c i n g S o u r c e s ( U s e s ) Di s p o s a l o f C a p i t a l A s s e t s - De b t I s s u a n c e - Tr a n s f e r s I n - Tr a n s f e r s O u t (1 , 5 0 1 , 5 0 2 ) (1 , 5 0 1 , 5 0 2 ) Ne t C h a n g e i n F u n d B a l a n c e s 2, 9 5 3 , 1 9 7 Fu n d B a l a n c e s - B e g i n n i n g 1, 2 7 0 , 6 2 3 Fu n d B a l a n c e s - E n d i n g 4, 2 2 3 , 8 2 0 Ge n e r a l Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . Pa r k s a n d Li b r a r y Re c r e a t i o n NonmajorTotals 1, 4 8 3 , 5 4 5 - 376,05911,176,987 24 , 1 2 3 - 976,8543,061,715 35 , 2 0 0 - 196,687400,718 14 , 1 9 0 26 5 , 6 1 4 -1,479,712 9, 4 0 4 - 16,739195,287 - 5, 5 6 9 68,76874,337 1, 4 6 5 24 4 7,37216,368 21 , 8 8 5 21 1 , 2 4 6 27,956652,606 1, 5 8 9 , 8 1 2 48 2 , 6 7 3 1,670,43517,057,730 - - 201,7253,498,104 75 2 , 3 7 3 - -752,373 - 1, 3 9 8 , 2 5 4 52,5701,450,824 - - 17,7103,568,665 - - -365,188 - - 194,2061,841,795 - - 572,022572,022 44 0 , 0 0 0 - 585,0741,025,074 35 6 , 2 3 7 - 307,258663,495 1, 5 4 8 , 6 1 0 1, 3 9 8 , 2 5 4 1,930,56513,737,540 41 , 2 0 2 (9 1 5 , 5 8 1 ) (260,130)3,320,190 - - 5,2005,200 - - 37,85037,850 26 , 8 1 9 95 5 , 8 8 6 521,2971,504,002 - - (2,500)(1,504,002) 26 , 8 1 9 95 5 , 8 8 6 561,84743,050 68 , 0 2 1 40 , 3 0 5 301,7173,363,240 39 3 , 8 0 4 28 0 , 0 6 5 2,739,0904,683,582 46 1 , 8 2 5 32 0 , 3 7 0 3,040,8078,046,822 Sp e c i a l R e v e n u e 100 The notes to the financial statements are an integral part of this statement. UNITED CITY OF YORKVILLE, ILLINOIS Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities Year Ended April 30, 2013 Net Change in Fund Balances - Total Governmental Funds $3,363,240 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 and reported as depreciation expense. Capital Outlays 3,896,935 Depreciation Expense (1,865,192) Disposals - Net of Accumulated Depreciation - The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal on long-term debt consumes the current financial resources of the governmental funds. Amortization of Bond Issuance Costs (42,893) Issuance of Notes Payable (37,850) Deductions to Compensated Absences Payable 59,575 Additions to Net Pension Obligation Payable (89,112) Deductions to Net Other Post-Employment Benefit Obligation Payable 1,526 Retirement of Debt 1,025,074 Changes to accrued interest on long-term debt in the Statement of Activities does not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds.14,837 Changes in Net Position of Governmental Activities 6,326,140 101 Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t s . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S St a t e m e n t o f N e t P o s i t i o n - P r o p r i e t a r y F u n d s Ap r i l 3 0 , 2 0 1 3 No n m a j o r Re c r e a t i o n Wa t e r C e n t e r T o t a l s Cu r r e n t A s s e t s Ca s h a n d I n v e s t m e n t s $ 2, 3 0 8 , 4 5 1 1 , 1 0 6 , 4 1 5 - 3 , 4 1 4 , 8 6 6 Re c e i v a b l e s - N e t o f A l l o w a n c e s Pr o p e r t y T a x e s 11 4 , 9 4 0 4 3 , 0 2 7 - 1 5 7 , 9 6 7 Ac c o u n t s 12 2 , 8 9 0 4 9 5 , 9 8 0 4 5 0 6 1 9 , 3 2 0 Du e f r o m O t h e r F u n d s 56 8 , 3 1 5 - - 5 6 8 , 3 1 5 Pr e p a i d s 13 , 0 8 1 2 4 , 5 5 2 1 9 , 0 0 0 5 6 , 6 3 3 To t a l C u r r e n t A s s e t s 3, 1 2 7 , 6 7 7 1 , 6 6 9 , 9 7 4 1 9 , 4 5 0 4 , 8 1 7 , 1 0 1 No n c u r r e n t A s s e t s Ca p i t a l A s s e t s No n d e p r e c i a b l e 38 , 9 5 1 1 , 5 1 8 , 2 7 6 - 1 , 5 5 7 , 2 2 7 De p r e c i a b l e 28 , 2 3 6 , 9 4 5 4 0 , 1 9 5 , 9 7 1 - 6 8 , 4 3 2 , 9 1 6 Ac c u m u l a t e d D e p r e c i a t i o n (2 , 5 3 8 , 7 7 4 ) ( 8 , 3 0 1 , 2 7 2 ) - ( 1 0 , 8 4 0 , 0 4 6 ) 25 , 7 3 7 , 1 2 2 3 3 , 4 1 2 , 9 7 5 - 5 9 , 1 5 0 , 0 9 7 Ot h e r A s s e t s As s e t s H e l d f o r O t h e r s 11 , 0 9 1 , 0 0 0 - - 1 1 , 0 9 1 , 0 0 0 To t a l N o n c u r r e n t A s s e t s 36 , 8 2 8 , 1 2 2 3 3 , 4 1 2 , 9 7 5 - 7 0 , 2 4 1 , 0 9 7 To t a l A s s e t s 39 , 9 5 5 , 7 9 9 3 5 , 0 8 2 , 9 4 9 1 9 , 4 5 0 7 5 , 0 5 8 , 1 9 8 Un a m o r t i z e d L o s s o n R e f u n d i n g 41 , 1 2 1 3 5 4 , 1 0 4 - 3 9 5 , 2 2 5 To t a l A s s e t s a n d D e f e r r e d O u t f l o w s of R e s o u r c e s 39 , 9 9 6 , 9 2 0 3 5 , 4 3 7 , 0 5 3 1 9 , 4 5 0 7 5 , 4 5 3 , 4 2 3 Bu s i n e s s - T y p e A c t i v i t i e s - E n t e r p r i s e Se w e r AS S E T S DE F E R R E D O U T F L O W S O F R E S O U R C E S Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t s . Nonmajor Recreation WaterCenterTotals Cu r r e n t L i a b i l i t i e s Ac c o u n t s P a y a b l e 8, 7 9 6 7 5 , 7 6 1 6 , 7 2 8 9 1 , 2 8 5 De p o s i t s P a y a b l e 5, 0 0 0 1 2 , 5 0 9 4 4 4 1 7 , 9 5 3 Ac c r u e d P a y r o l l 5, 6 1 1 1 0 , 1 6 2 3 , 8 3 0 1 9 , 6 0 3 Ac c r u e d I n t e r e s t P a y a b l e 21 1 , 0 6 9 1 5 4 , 0 4 4 - 3 6 5 , 1 1 3 Du e t o O t h e r F u n d s - -308,868308,868 Ot h e r P a y a b l e s - 1,836-1,836 Cu r r e n t P o r t i o n o f L o n g - T e r m D e b t 1, 3 1 3 , 8 6 7 7 1 0 , 5 9 7 2 4 0 2 , 0 2 4 , 7 0 4 To t a l C u r r e n t L i a b i l i t i e s 1, 5 4 4 , 3 4 3 9 6 4 , 9 0 9 3 2 0 , 1 1 0 2 , 8 2 9 , 3 6 2 No n c u r r e n t L i a b i l i t i e s Co m p e n s a t e d A b s e n c e s P a y a b l e 11 , 6 5 8 2 2 , 5 4 4 9 6 4 3 5 , 1 6 6 IE P A L o a n s P a y a b l e 54 4 , 9 3 2 1 , 3 3 5 , 1 5 2 - 1 , 8 8 0 , 0 8 4 Ge n e r a l O b l i g a t i o n B o n d s P a y a b l e 12 , 5 6 0 , 0 0 0 4 , 2 9 5 , 0 0 0 - 1 6 , 8 5 5 , 0 0 0 De b t C e r t i f i c a t e s P a y a b l e 1, 3 5 0 , 0 0 0 5 , 3 3 0 , 0 0 0 - 6 , 6 8 0 , 0 0 0 Ot h e r L i a b i l i t i e s 1, 1 1 2 , 7 3 2 8 3 9 , 8 0 2 - 1 , 9 5 2 , 5 3 4 To t a l N o n c u r r e n t L i a b i l i t i e s 15 , 5 7 9 , 3 2 2 1 1 , 8 2 2 , 4 9 8 9 6 4 2 7 , 4 0 2 , 7 8 4 To t a l L i a b i l i t i e s 17 , 1 2 3 , 6 6 5 1 2 , 7 8 7 , 4 0 7 3 2 1 , 0 7 4 3 0 , 2 3 2 , 1 4 6 Ne t I n v e s t m e n t i n C a p i t a l A s s e t s 9, 9 7 1 , 2 3 8 2 1 , 7 4 7 , 8 6 2 - 3 1 , 7 1 9 , 1 0 0 Un r e s t r i c t e d 12 , 9 0 2 , 0 1 7 9 0 1 , 7 8 4 ( 3 0 1 , 6 2 4 ) 1 3 , 5 0 2 , 1 7 7 To t a l N e t P o s i t i o n 22 , 8 7 3 , 2 5 5 2 2 , 6 4 9 , 6 4 6 ( 3 0 1 , 6 2 4 ) 4 5 , 2 2 1 , 2 7 7 NE T P O S I T I O N LI A B I L I T I E S Se w e r Bu s i n e s s - T y p e A c t i v i t i e s - E n t e r p r i s e 102 Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S St a t e m e n t o f R e v e n u e s , E x p e n s e s a n d C h a n g e s i n N e t P o s i t i o n - P r o p r i e t a r y F u n d s Ye a r E n d e d A p r i l 3 0 , 2 0 1 3 No n m a j o r Re c r e a t i o n Wa t e r C e n t e r T o t a l s Op e r a t i n g R e v e n u e s Ch a r g e s f o r S e r v i c e s $ 7 4 4 , 8 2 0 2 , 6 7 9 , 5 4 7 4 9 3 , 6 1 7 3 , 9 1 7 , 9 8 4 Op e r a t i n g E x p e n s e s Op e r a t i o n s 42 5 , 2 8 7 1 , 2 3 9 , 7 0 2 5 9 2 , 7 0 7 2 , 2 5 7 , 6 9 6 De p r e c i a t i o n a n d A m o r t i z a t i o n 49 6 , 0 7 7 8 7 6 , 3 6 8 - 1 , 3 7 2 , 4 4 5 To t a l O p e r a t i n g E x p e n s e s 92 1 , 3 6 4 2 , 1 1 6 , 0 7 0 5 9 2 , 7 0 7 3 , 6 3 0 , 1 4 1 Op e r a t i n g I n c o m e ( L o s s ) (1 7 6 , 5 4 4 ) 5 6 3 , 4 7 7 ( 9 9 , 0 9 0 ) 2 8 7 , 8 4 3 No n o p e r a t i n g R e v e n u e s ( E x p e n s e s ) In t e r e s t I n c o m e 7, 3 3 9 2, 2 0 3 - 9, 5 4 2 Co n n e c t i o n F e e s 61 3 , 6 0 0 1 4 3 , 8 1 0 - 75 7 , 4 1 0 Ot h e r I n c o m e 13 5 , 3 2 6 1 0 6 , 0 6 5 1 7 , 4 6 7 2 5 8 , 8 5 8 In t e r e s t E x p e n s e (7 0 8 , 6 5 9 ) ( 5 2 2 , 1 8 2 ) - ( 1 , 2 3 0 , 8 4 1 ) 47 , 6 0 6 ( 2 7 0 , 1 0 4 ) 1 7 , 4 6 7 ( 2 0 5 , 0 3 1 ) In c o m e ( L o s s ) B e f o r e C o n t r i b u t i o n s an d T r a n s f e r s (1 2 8 , 9 3 8 ) 2 9 3 , 3 7 3 ( 8 1 , 6 2 3 ) 8 2 , 8 1 2 Ca p i t a l C o n t r i b u t i o n s 3, 3 4 3 , 3 5 1 1 , 4 8 6 , 1 4 0 - 4 , 8 2 9 , 4 9 1 Tr a n s f e r s I n - 82 , 2 8 8 - 82 , 2 8 8 Tr a n s f e r s O u t (8 2 , 2 8 8 ) - - (8 2 , 2 8 8 ) Ch a n g e i n N e t P o s i t i o n 3, 1 3 2 , 1 2 5 1 , 8 6 1 , 8 0 1 ( 8 1 , 6 2 3 ) 4 , 9 1 2 , 3 0 3 Ne t P o s i t i o n - B e g i n n i n g a s R e s t a t e d 1 9 , 7 4 1 , 1 3 0 2 0 , 7 8 7 , 8 4 5 ( 2 2 0 , 0 0 1 ) 4 0 , 3 0 8 , 9 7 4 Ne t P o s i t i o n - E n d i n g 22 , 8 7 3 , 2 5 5 2 2 , 6 4 9 , 6 4 6 ( 3 0 1 , 6 2 4 ) 4 5 , 2 2 1 , 2 7 7 Bu s i n e s s - T y p e A c t i v i t i e s - E n t e r p r i s e Se w e r Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S St a t e m e n t o f C a s h F l o w s - P r o p r i e t a r y F u n d s Ye a r E n d e d A p r i l 3 0 , 2 0 1 3 Nonmajor Recreation WaterCenterTotals Ca s h F l o w s f r o m O p e r a t i n g A c t i v i t i e s Re c e i p t s f r o m C u s t o m e r s a n d U s e r s $ 2 , 4 3 5 , 8 2 7 3 , 0 1 8 , 1 0 2 5 1 0 , 3 4 1 5 , 9 6 4 , 2 7 0 Pa y m e n t s t o E m p l o y e e s (173,474)(310,125)(170,858)(654,457) Pa y m e n t s t o S u p p l i e r s (1 , 0 8 2 , 9 7 3 ) ( 1 , 0 8 7 , 4 4 0 ) ( 3 3 9 , 4 8 3 ) ( 2 , 5 0 9 , 8 9 6 )1,179,3801,620,537-2,799,917 Ca s h F l o w s f r o m N o n c a p i t a l F i n a n c i n g A c t i v i t i e s Tr a n s f e r s I n ( O u t ) (82,288)82,288-- Ch a n g e i n I n t e r f u n d 802,106--802,106 719,81882,288-802,106 Ca s h F l o w s f r o m C a p i t a l a n d R e l a t e d F i n a n c i n g A c t i v i t i e s Pu r c h a s e o f C a p i t a l A s s e t s (13,898)(50,251)-(64,149) De b t R e p a y m e n t (571,568)(907,753)-(1,479,321) In t e r e s t P a y m e n t s (708,659)(522,182)-(1,230,841) (1 , 2 9 4 , 1 2 5 ) ( 1 , 4 8 0 , 1 8 6 ) - ( 2 , 7 7 4 , 3 1 1 ) Ca s h F l o w s f r o m I n v e s t i n g A c t i v i t i e s In t e r e s t R e c e i v e d 7,3392,203-9,542 Ne t C h a n g e i n C a s h a n d C a s h E q u i v a l e n t s 612,412224,842-837,254 Ca s h a n d C a s h E q u i v a l e n t s - B e g i n n i n g 1,696,039881,573-2,577,612 Ca s h a n d C a s h E q u i v a l e n t s - E n d i n g 2,308,4511,106,415-3,414,866 Re c o n c i l i a t i o n o f O p e r a t i n g I n c o m e t o N e t C a s h P r o v i d e d (U s e d ) b y O p e r a t i n g A c t i v i t i e s Op e r a t i n g I n c o m e ( L o s s ) (176,544)563,477(99,090)287,843 Ad j u s t m e n t s t o R e c o n c i l e O p e r a t i n g I n c o m e t o N e t I n c o m e to N e t C a s h P r o v i d e d b y ( U s e d i n ) O p e r a t i n g A c t i v i t i e s : De p r e c i a t i o n a n d A m o r t i z a t i o n E x p e n s e 496,077876,368-1,372,445 Co n n e c t i o n F e e s / O t h e r I n c o m e 748,926249,87517,4671,016,268 (I n c r e a s e ) D e c r e a s e i n C u r r e n t A s s e t s 942,08188,680(743)1,030,018 In c r e a s e ( D e c r e a s e ) i n C u r r e n t L i a b i l i t i e s (831,160)(157,863)82,366(906,657) Ne t C a s h P r o v i d e d b y O p e r a t i n g A c t i v i t i e s 1,179,3801,620,537-2,799,917 No n c a s h A c t i v i t y - C a p i t a l C o n t r i b u t i o n s 3,343,3511,486,140-4,829,491Business-Type Activities - Enterprise Sewer 103 Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S St a t e m e n t o f N e t P o s i t i o n - F i d u c i a r y F u n d s Ap r i l 3 0 , 2 0 1 3 Ag e n c y Ca s h a n d C a s h E q u i v a l e n t s $ 4 3 1 , 7 3 3 3 9 5 , 8 3 4 In v e s t m e n t s U. S . G o v e r n m e n t a n d A g e n c y S e c u r i t i e s 2 , 0 1 6 , 3 2 5 - Mu t u a l F u n d s 2, 2 7 1 , 5 8 9 - Co r p o r a t e B o n d s 31 1 , 9 2 2 - Re c e i v a b l e s - N e t o f A l l o w a n c e s - 55 6 , 2 4 9 Ac c r u e d I n t e r e s t 21 , 5 1 8 - To t a l A s s e t s 5, 0 5 3 , 0 8 7 95 2 , 0 8 3 Ac c o u n t s P a y a b l e 1, 6 4 8 - Ot h e r L i a b i l i t i e s - 95 2 , 0 8 3 To t a l L i a b i l i t i e s 1, 6 4 8 95 2 , 0 8 3 He l d i n T r u s t f o r P e n s i o n B e n e f i t s 5, 0 5 1 , 4 3 9 - NE T P O S I T I O N Tr u s t Pe n s i o n Po l i c e AS S E T S LI A B I L I T I E S Th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t a r e a n i n t e g r a l p a r t o f t h i s s t a t e m e n t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S St a t e m e n t o f C h a n g e s i n N e t P o s i t i o n - F i d u c i a r y F u n d Ye a r E n d e d A p r i l 3 0 , 2 0 1 3 Ad d i t i o n s Co n t r i b u t i o n s - E m p l o y e r $438,711 Co n t r i b u t i o n s - P l a n M e m b e r s 180,395 To t a l C o n t r i b u t i o n s 619,106 In v e s t m e n t I n c o m e In t e r e s t E a r n e d 127,779 Ne t C h a n g e i n F a i r V a l u e 235,550 363,329 Le s s I n v e s t m e n t E x p e n s e s (20,761) Ne t I n v e s t m e n t I n c o m e 342,568 To t a l A d d i t i o n s 961,674 De d u c t i o n s Ad m i n i s t r a t i o n 14,193 Be n e f i t s a n d R e f u n d s 378,075 To t a l D e d u c t i o n s 392,268 Ch a n g e i n N e t P o s i t i o n 569,406 Ne t P o s i t i o n H e l d i n T r u s t f o r P e n s i o n B e n e f i t s Ne t P o s i t i o n - B e g i n n i n g 4,482,033 Ne t P o s i t i o n - E n d i n g 5,051,439PoliceTrustPension 104 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 1 – S U M M A R Y O F S I G N I F I C A N T A C C O U N T I N G P O L I C I E S Th e U n i t e d C i t y o f Y o r k v i l l e ( C i t y ) i s a n I l l i n o i s un i t o f l o c a l g o v e r n m e n t . T h e f i n a n c i a l s t a t e m e n t s in c l u d e a l l f u n c t i o n s , p r o g r a m s a n d a c t i v i t i e s u n d e r c o n t r o l o f t h e C i t y C o u n c i l . T h e C i t y ’ s m a j o r op e r a t i o n s i n c l u d e p u b l i c s a f e t y , p u b l i c w o r k s , l i b r a r y , p a r k s a n d r e c r e a t i o n , c o m m u n i t y d e v e l o p m e n t , wa t e r a n d s e w e r s e r v i c e s , a n d g e n e r a l a d m i n i s t r a t i o n . T h e C i t y C o u n c i l h a s o v e r s i g h t r e s p o n s i b i l i t y f o r th e C i t y , t h e P u b l i c L i b r a r y a n d t h e P a r k a n d R e c r e a t i o n B o a r d . O v e r s i g h t r e s p o n s i b i l i t y i n c l u d e s de s i g n a t i o n o f m a n a g e m e n t an d a l l o t h e r c o n t r o l o v e r o p e r a t i o n s o f t h e s e e n t i t i e s . Th e g o v e r n m e n t - w i d e f i n a n c i a l s t a t e m e n t s a r e pr e p a r e d i n a c c o r d a n c e w i t h g e n e r a l l y a c c e p t e d ac c o u n t i n g p r i n c i p l e s ( G A A P ) . T h e G o v e r n m e n t a l A c c o u n t i n g S t a n d a r d s B o a r d ( G A S B ) i s r e s p o n s i b l e fo r e s t a b l i s h i n g G A A P f o r s t a t e a n d l o c a l g o v e r n m e n t s t h r o u g h i t s p r o n o u n c e m e n t s ( S t a t e m e n t s a n d In t e r p r e t a t i o n s ) . T h e m o r e s i g n i f i c a n t o f t h e C i t y ’ s a c c o u n t i n g p o l i c i e s e s t a b l i s h e d i n G A A P a n d u s e d by t h e C i t y a r e d e s c r i b e d b e l o w . RE P O R T I N G E N T I T Y Th e C i t y ’ s f i n a n c i a l r e p o r t i n g e n t i t y c o m p r i s e s t h e f o l l o w i n g : Pr i m a r y G o v e r n m e n t : Un i t e d C i t y o f Y o r k v i l l e In d e t e r m i n i n g t h e f i n a n c i a l r e p o r t i n g e n t i t y , t h e Ci t y c o m p l i e s w i t h t h e p r o v i s i o n s o f G A S B S t a t e m e n t No . 3 9 , “ D e t e r m i n i n g W h e t h e r C e r t a i n O r g a n i z a t i o n s a r e C o m p o n e n t U n i t s – a n A m e n d m e n t o f G A S B St a t e m e n t N o . 1 4 , ” a n d i n c l u d e s a l l c o m p o n e n t u n i t s t h a t h a v e a s i g n i f i c a n t o p e r a t i o n a l o r f i n a n c i a l re l a t i o n s h i p w i t h t h e C i t y . B a s e d u p o n t h e c r i t e r i a s e t f o r t h i n t h e G A S B S t a t e m e n t N o . 3 9 , t h e r e a r e n o co m p o n e n t u n i t s i n c l u d e d i n t h e r e p o r t i n g e n t i t y . Po l i c e P e n s i o n E m p l o y e e s R e t i r e m e n t S y s t e m Th e C i t y ’ s p o l i c e e m p l o y e e s p a r t i c i p a t e i n t h e P o l i c e P e n s i o n E m p l o y e e s R e t i r e m e n t S y s t e m ( P P E R S ) . PP E R S f u n c t i o n s f o r t h e b e n e f i t o f t h e s e e m p l o y e e s a n d i s g o v e r n e d b y a f i v e - m e m b e r p e n s i o n b o a r d . Tw o m e m b e r s a p p o i n t e d b y t h e C i t y ’ s M a y o r , o n e e l e c t e d p e n s i o n b e n e f i c i a r y a n d t w o e l e c t e d p o l i c e em p l o y e e s c o n s t i t u t e t h e p e n s i o n b o a r d . T h e p a r t i c i p a n t s a r e r e q u i r e d t o c o n t r i b u t e a p e r c e n t a g e o f sa l a r y a s e s t a b l i s h e d b y s t a t e s t a t u t e a n d t h e C i t y i s o b l i g a t e d t o f u n d a l l r e m a i n i n g P P E R S c o s t s b a s e d up o n a c t u a r i a l v a l u a t i o n s . T h e S t a t e o f I l l i n o i s i s a u t h o r i z e d t o e s t a b l i s h b e n e f i t l e v e l s a n d t h e C i t y i s au t h o r i z e d t o a p p r o v e t h e a c t u a r i a l a s s u m p t i o n s u s e d i n t h e d e t e r m i n a t i o n o f c o n t r i b u t i o n l e v e l s . Al t h o u g h i t i s l e g a l l y s e p a r a t e f r o m t h e C i t y , t h e P P E R S i s r e p o r t e d a s i f i t w e r e p a r t o f t h e p r i m a r y Ci t y b e c a u s e i t s s o l e p u r p o s e i s t o p r o v i d e r e t i r e m e n t b e n e f i t s f o r t h e C i t y ’ s p o l i c e e m p l o y e e s . T h e PP E R S i s r e p o r t e d a s a p e n s i o n t r u s t f u n d . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 1 – S U M M A R Y O F S I G N I F I C A N T A C C O U N T I N G P O L I C I E S –Continued BA S I S O F P R E S E N T A T I O N Go v e r n m e n t - W i d e S t a t e m e n t s Th e C i t y ’ s b a s i c f i n a n c i a l s t a t e m e n ts i n c l u d e b o t h g o v e r n m e n t - w i d e ( r e porting the Cityas a whole) and fu n d f i n a n c i a l s t a t e m e n t s ( r e p o r t i n g t h e C i t y ’ s m a j o r f u n d s ) . B o t h t h e g o v e r n m e n t - w i d e a n d f u n d fi n a n c i a l s t a t e m e n t s c a t e g o r i z e p r i m a r y a c t i v i t i e s a s e i t h e r g o v e r n m e n t a l o r b u s i n e s s t y p e . T h e C i t y ’ s po l i c e s a f e t y , h i g h w a y a n d s t r e e t m a i n t e n a n c e a n d r e c o n s t r u c t i o n , b u i l d i n g c o d e e n f o r c e m e n t , p u b l i c im p r o v e m e n t s , e c o n o m i c d e v e l o p m e n t , p a r k s a n d r e c r e a t i o n , p l a n n i n g a n d z o n i n g , a n d g e n e r a l ad m i n i s t r a t i v e s e r v i c e s a r e c l a s s i f i e d a s g o v e r n m e n t a l a c t i v i t i e s . T h e C i t y ’ s s e w e r , w a t e r , a n d r e c r e a t i o n ce n t e r s e r v i c e s a r e c l a s s i f i e d a s b u s i n e s s - t y p e a c t i v i t i e s . In t h e g o v e r n m e n t - w i d e S t a t e m e n t o f N e t P o s i t i o n , bo t h t h e g o v e r n m e n t a l a n d b u s i n e s s - t y p e a c t i v i t i e s co l u m n s a r e : ( a ) p r e s e n t e d o n a c o n s o l i d a t e d b a s i s b y c o l u m n , a n d ( b ) r e p o r t e d o n a f u l l a c c r u a l , ec o n o m i c r e s o u r c e b a si s , w h i c h r e c o g n i z e s a l l l o n g - t e r m a s s e t s / d e f e r r e d o u t f l o w s a n d r e c e i v a b l e s a s we l l a s l o n g - t e r m d e b t / d e f e r r e d i n f l o w s a n d o b l i g a t i o n s . Th e C i t y ’ s n e t p o s i t i o n i s r e p o r t e d i n t h r e e p a r t s : ne t i n v e s t m e n t i n c a p i t a l assets; restricted; and un r e s t r i c t e d . T h e C i t y f i r s t u t i l i z e s r e s t r i c t e d r e s o u r c e s t o f i n a n c e q u a l i f y i n g a c t i v i t i e s . Th e g o v e r n m e n t - w i d e S t a t e m e n t o f A c t i v i t i e s r e p o r t s b o t h t h e g r o s s a n d n e t c o s t o f e a c h o f t h e C i t y ’ s fu n c t i o n s a n d b u s i n e s s - t y p e a c t i v i t i e s ( g e n e r a l g o v e r n m e n t , p u b l i c s a f e t y , h i g h w a y s a n d s t r e e t s , e t c . ) . Th e f u n c t i o n s a r e s u p p o r t e d b y g e n e r a l g o v e r n m e n t r e v e n u e s ( p r o p e r t y , s a l e s a n d u s e t a x e s , c e r t a i n in t e r g o v e r n m e n t a l r e v e n u e s , f i n e s , p e r m i t s a n d c h a r g e s f o r s e r v i c e s , e t c . ) . T h e S t a t e m e n t o f A c t i v i t i e s re d u c e s g r o s s e x p e n s e s ( i n c l u d i n g d e p r e c i a t i o n ) b y r e l a t e d p r o g r a m r e v e n u e s , w h i c h i n c l u d e 1 ) c h a n g e s to c u s t o m e r s o r a p p l i c a n t s w h o p u r c h a s e , u s e o r d i r e c t l y b e n e f i t f r o m g o o d s , s e r v i c e s o r p r i v i l e g e s pr o v i d e d b y a g i v e n f u n c t i o n o r s e g m e n t a n d 2 ) g r a n t s a n d c o n t r i b u t i o n s t h a t a r e r e s t r i c t e d t o m e e t i n g th e o p e r a t i o n a l o r c a p i t a l r e q u i r e m e n t s o f a p a r t i c u l a r f u n c t i o n o r s e g m e n t . Th e n e t c o s t s ( b y f u n c t i o n o r b u s i n e s s - t y p e a c t i v i t y ) a r e n o r m a l l y c o v e r e d b y g e n e r a l r e v e n u e ( p r o p e r t y , sa l e s a n d u s e t a x e s , c e r t a i n i n t e r g o v e r n m e n t a l r e v e n u e s , p e r m i t s a n d c h a r g e s f o r s e r v i c e s , e t c . ) . Th i s g o v e r n m e n t - w i d e f o c u s i s m o r e o n t h e s u s t a i n a b i l i t y o f t h e C i t y a s a n e n t i t y a n d t h e c h a n g e i n t h e Ci t y ’ s n e t p o s i t i o n r e s u l t i n g f r o m t h e c u r r e n t y e a r ’ s a c t i v i t i e s . 105 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 1 – S U M M A R Y O F S I G N I F I C A N T A C C O U N T I N G P O L I C I E S – C o n t i n u e d BA S I S O F P R E S E N T A T I O N – Co n t i n u e d Fu n d F i n a n c i a l S t a t e m e n t s Th e f i n a n c i a l t r a n s a c t i o n s o f t h e C i t y a r e r e p o r t e d i n i n d i v i d u a l f u n d s i n t h e f u n d f i n a n c i a l s t a t e m e n t s . Ea c h f u n d i s a c c o u n t e d f o r b y p r o v i d i n g a s e p a r a t e s e t o f s e l f - b a l a n c i n g a c c o u n t s t h a t c o m p r i s e i t s as s e t s / d e f e r r e d o u t f l o w s , l i a b i l i t i e s / d e f e r r e d i n f l o w s , f u n d e q u i t y , r e v e n u e s a n d e x p e n d i t u r e s / e x p e n s e s . Fu n d s a r e o r g a n i z e d i n t o t h r e e m a j o r c a t e g o r i e s : g o v e r n m e n t a l , p r o p r i e t a r y , a n d f i d u c i a r y . T h e em p h a s i s i n f u n d f i n a n c i a l s t a t e m e n t s i s o n t h e m a j o r f u n d s i n e i t h e r t h e g o v e r n m e n t a l o r b u s i n e s s - t y p e ac t i v i t i e s c a t e g o r i e s . No n m a j o r f u n d s b y c a t e g o r y a r e s u m m a r i z e d i n t o a s i n g l e c o l u m n . G A S B S t a t e m e n t N o . 3 4 s e t s f o r t h mi n i m u m c r i t e r i a ( p e r c e n t a g e o f t h e a s s e t s / d e f e r r e d o u t f l o w s , l i a b i l i t i e s / d e f e r r e d i n f l o w s , r e v e n u e s o r ex p e n d i t u r e s / e x p e n s e s o f e i t h e r f u n d c a t e g o r y o r t h e g o v e r n m e n t a l a n d e n t e r p r i s e c o m b i n e d ) f o r t h e de t e r m i n a t i o n o f m a j o r f u n d s . T h e C i t y e l e c t i v e l y a d d e d f u n d s , a s m a j o r f u n d s , w h i c h e i t h e r h a v e d e b t ou t s t a n d i n g o r a s p e c i f i c c o m m u n i t y f o c u s . T h e n o n m a j o r f u n d s a r e c o m b i n e d i n a c o l u m n i n t h e f u n d fi n a n c i a l s t a t e m e n t s . A f u n d i s c o n s i d e r e d m a j o r i f i t i s t h e p r i m a r y o p e r a t i n g f u n d o f t h e C i t y o r m e e t s th e f o l l o w i n g c r i t e r i a : To t a l a s s e t s / d e f e r r e d o u t f l o w s , l i a b i l i t i e s / d e f e r r e d i n f l o ws , r e v e n u e s , o r ex p e n d i t u r e s / e x p e n s e s o f t h a t i n d i v i d u a l g o v e r n m e n t a l o r e n t e r p r i s e f u n d ar e a t l e a s t 1 0 p e r c e n t o f t h e c o r r e s p o n d i n g t o t a l f o r a l l f u n d s o f t h a t ca t e g o r y o r t y p e ; a n d To t a l a s s e t s / d e f e r r e d o u t f l o w s , l i a b i l i t i e s / d e f e r r e d i n f l o ws , r e v e n u e s , o r ex p e n d i t u r e s / e x p e n s e s o f t h e i n d i v i d u a l g o v e r n m e n t a l f u n d o r e n t e r p r i s e fu n d a r e a t l e a s t 5 p e r c e n t o f t h e c o r r e s p o n d i n g t o t a l f o r a l l g o v e r n m e n t a l an d e n t e r p r i s e f u n d s c o m b i n e d . Th e v a r i o u s f u n d s a r e r e p o r t e d b y g e n e r i c c l a s s i f i c a t i o n w i t h i n t h e f i n a n c i a l s t a t e m e n t s . T h e f o l l o w i n g fu n d t y p e s a r e u s e d b y t h e C i t y : Go v e r n m e n t a l F u n d s Th e f o c u s o f t h e g o v e r n m e n t a l f u n d s ’ m e a s u r e m e n t ( i n t h e f u n d s t a t e m e n t s ) i s u p o n d e t e r m i n a t i o n o f fi n a n c i a l p o s i t i o n a n d c h a n g e s i n f i n a n c i a l p o s i t i o n ( s o u r c e s , u s e s , a n d b a l a n c e s o f f i n a n c i a l r e s o u r c e s ) ra t h e r t h a n u p o n n e t i n c o m e . T h e f o l l o w i n g i s a d e s c r i p t i o n o f t h e g o v e r n m e n t a l f u n d s o f t h e C i t y : Ge n e r a l f u n d is t h e g e n e r a l o p e r a t i n g f u n d o f t h e C i t y . I t i s u s e d t o a c c o u n t f o r a l l f i n a n c i a l r e s o u r c e s ex c e p t t h o s e r e q u i r e d t o b e a c c o u n t e d f o r i n a n o t h e r f u n d . T h e G e n e r a l F u n d i s a m a j o r f u n d . Sp e c i a l r e v e n u e f u n d s ar e u s e d t o a c c o u n t f o r t h e p r o c e e d s o f s p e c i f i c r e v e n u e s o u r c e s t h a t a r e l e g a l l y re s t r i c t e d t o e x p e n d i t u r e s f o r s p e c i f i e d p u r p o s e s . T h e C i t y m a i n t a i n s n i n e s p e c i a l r e v e n u e f u n d s . T h e Li b r a r y F u n d , a m a j o r f u n d , i s u s e d t o a c c o u n t f o r t h e a c t i v i t y r e l a t i n g t o t h e Y o r k v i l l e P u b l i c L i b r a r y . Th e P a r k s a n d R e c r e a t i o n F u n d , a l s o a m a j o r f u n d , i s u s e d t o a c c o u n t f o r t h e r e v e n u e s a n d e x p e n d i t u r e s as s o c i a t e d w i t h Y o r k v i l l e ’ s P a r k s a n d R e c r e a t i o n d e p a r t m e n t s . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 1 – S U M M A R Y O F S I G N I F I C A N T A C C O U N T I N G P O L I C I E S – Continued BA S I S O F P R E S E N T A T I O N – Co n t i n u e d Fu n d F i n a n c i a l S t a t e m e n t s – C o n t i n u e d Go v e r n m e n t a l F u n d s – C o n t i n u e d De b t s e r v i c e f u n d s ar e u s e d t o a c c o u n t f o r t h e a c c u m u l a t i o n o f f u n d s f o r t h e p e r i o d i c p a y m e n t o f pr i n c i p a l a n d i n t e r e s t o n g e n e r a l l o n g - t e r m d e b t . T h e C i t y m a i n t a i n s o n e d e b t s e r v i c e f u n d . Ca p i t a l p r o j e c t s f u n d s ar e u s e d t o a c c o u n t f o r f i n a n c i a l r e s o u r c e s t o b e u s e d f o r t h e a c q u i s i t i o n o r co n s t r u c t i o n o f m a j o r c a p i t a l f a c i l i t i e s ( o t h e r t h a n th o s e f i n a n c e d b y b u s i n e s s - t y p e / p r o p r i e t a r y f u n d s ) . Th e C i t y m a i n t a i n s f i v e c a p i t a l p r o j e c t s f u n d s . Pr o p r i e t a r y F u n d s Th e f o c u s o f p r o p r i e t a r y f u n d m e a s u r e m e n t i s u p o n d e t e r m i n a t i o n o f o p e r a t i n g i n c o m e , c h a n g e s i n n e t po s i t i o n , f i n a n c i a l p o s i t i o n , a n d c a s h f l o w s . T h e g e n e r a l l y a c c e p t e d a c c o u n t i n g p r i n c i p l e s a p p l i c a b l e a r e th o s e s i m i l a r t o b u s i n e s s e s i n t h e p r i v a t e s e c t o r . T h e f o l l o w i n g i s a d e s c r i p t i o n o f t h e p r o p r i e t a r y f u n d s of t h e C i t y : En t e r p r i s e f u n d s ar e r e q u i r e d t o a c c o u n t f o r o p e r a t i o n s f o r w h i c h a f e e i s c h a r g e d t o e x t e r n a l u s e r s f o r go o d s o r s e r v i c e s a n d t h e a c t i v i t y i s ( a ) f i n a n c e d w i t h d e b t t h a t i s s o l e l y s e c u r e d b y a p l e d g e o f t h e n e t re v e n u e s , ( b ) h a s t h i r d p a r t y r e q u i r e m e n t s t h a t t h e c o s t o f p r o v i d i n g s e r v i c e s , i n c l u d i n g c a p i t a l c o s t s , b e re c o v e r e d w i t h f e e s a n d c h a r g e s , o r ( c ) e s t a b l i s h e s f e e s a n d c h a r g e s b a s e d o n a p r i c i n g p o l i c y d e s i g n e d to r e c o v e r s i m i l a r c o s t s . T h e C i t y m a i n t a i n s t h r e e e n t e r p r i s e f u n d s . T h e S e w e r F u n d , a m a j o r f u n d , i s us e d t o a c c o u n t f o r t h e o p e r a t i o n a n d s e w e r i n f r a s t r u c t u r e m a i n t e n a n c e o f t h e C i t y - o w n e d s e w e r sy s t e m , a s w e l l a s t h e c o n s t r u c t i o n o f n e w s e w e r s y s t e m s w i t h i n C i t y l i m i t s . R e v e n u e s a r e g e n e r a t e d th r o u g h a u s e r m a i n t e n a n c e f e e . T h e W a t e r F u n d , a l s o a m a j o r f u n d , i s u s e d t o a c c o u n t f o r t h e o p e r a t i o n an d w a t e r i n f r a s t r u c t u r e m a i n t e n a n c e o f t h e C i t y - o w n e d w a t e r d i s t r i b u t i o n s y s t e m , a s w e l l a s t h e co n s t r u c t i o n o f n e w w a t e r s y s t e m s . R e v e n u e s a r e g e n e r a t e d t h r o u g h c h a r g e s b a s e d o n w a t e r co n s u m p t i o n a n d u s e r m a i n t e n a n c e f e e s . Fi d u c i a r y F u n d s Fi d u c i a r y f u n d s a r e u s e d t o r e p o r t a s s e t s h e l d i n a t r u s t e e o r a g e n c y c a p a c i t y b y t h e C i t y f o r o t h e r s a n d th e r e f o r e a r e n o t a v a i l a b l e t o s u p p o r t C i t y p r o g r a m s . T h e r e p o r t i n g f o c u s i s o n n e t p o s i t i o n a n d c h a n g e s in n e t p o s i t i o n a n d i s r e p o r t e d u s i n g a c c o u n t i n g p r i n c i p l e s s i m i l a r t o p r o p r i e t a r y f u n d s . Pe n s i o n t r u s t f u n d s ar e u s e d t o a c c o u n t f o r a s s e t s h e l d i n a t r u s t e e c a p a c i t y b y t h e C i t y f o r p e n s i o n be n e f i t p a y m e n t s . T h e P o l i c e P e n s i o n F u n d a c c o u n t s f o r t h e a c c u m u l a t i o n o f r e s o u r c e s t o p a y p e n s i o n co s t s . R e s o u r c e s a r e c o n t r i b u t e d b y p o l i c e f o r c e m e m b er s a t r a t e s f i x e d b y s t ate statutes and by the go v e r n m e n t t h r o u g h a n a n n u a l p r o p e r t y t a x l e v y . 106 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 1 – S U M M A R Y O F S I G N I F I C A N T A C C O U N T I N G P O L I C I E S – Co n t i n u e d BA S I S O F P R E S E N T A T I O N – Co n t i n u e d Fu n d F i n a n c i a l S t a t e m e n t s – Co n t i n u e d Fi d u c i a r y F u n d s – Co n t i n u e d Ag e n c y f u n d s ar e u s e d t o a c c o u n t f o r a s s e t s h e l d b y t h e C i t y i n a p u r e l y c u s t o d i a l c a p a c i t y . T h e De v e l o p e r D e p o s i t F u n d i s u s e d t o a c c o u n t f o r d e v e l o p e r d e p o s i t s t h a t a r e u s e d t o r e i m b u r s e t h e C i t y fo r a l l e x p e n s e s i n c u r r e d a s a r e s u l t o f p r o c e s s i n g d e v e l o p e r a p p l i c a t i o n s a n d r e q u e s t s . T h e E s c r o w De p o s i t F u n d i s u s e d t o a c c o u n t f o r v a r i o u s f u n d s c o l l e c t e d o n b e h a l f o f o t h e r g o v e r n m e n t a l a g e n c i e s . Th e C i t y ’ s f i d u c i a r y f u n d s a r e p r e s e n t e d i n t h e f i d u c ia r y f u n d f i n a n c i a l s t a t e m e n t s b y t y p e ( p e n s i o n tr u s t a n d a g e n c y ) . S i n c e b y d e f i n i t i o n t h e s e a s s e t s a r e b e i n g h e l d f o r t h e b e n e f i t o f a t h i r d p a r t y ( o t h e r lo c a l g o v e r n m e n t s , p r i v a t e p a r t i e s , p e n s i o n p a r t i c i p a n t s , e t c . ) a n d c a n n o t b e u s e d t o a d d r e s s a c t i v i t i e s o r ob l i g a t i o n s o f t h e C i t y , t h e s e f u n d s a r e n o t i n c o r p o r a t e d i n t o t h e g o v e r n m e n t - w i d e s t a t e m e n t s . ME A S U R E M E N T F O C U S A N D B A S I S O F A C C O U N T I N G Me a s u r e m e n t f o c u s i s a t e r m u s e d t o d e s c r i b e “ w hi c h ” t r a n s a c t i o n s a r e r e c o r d e d w i t h i n t h e v a r i o u s fi n a n c i a l s t a t e m e n t s . B a s i s o f a c c o u n t i n g r e f e r s t o “ w h e n ” t r a n s a c t i o n s a r e r e c o r d e d r e g a r d l e s s o f t h e me a s u r e m e n t f o c u s a p p l i e d . Me a s u r e m e n t F o c u s On t h e g o v e r n m e n t - w i d e S t a t e m e n t o f N e t P o s i t i o n a n d t h e S t a t e m e n t o f A c t i v i t i e s , b o t h g o v e r n m e n t a l an d b u s i n e s s - l i k e a c t i v i t i e s a r e p r e s e n t e d u s i n g t h e e c o n o m i c r e s o u r c e s m e a s u r e m e n t f o c u s a s d e f i n e d be l o w . In t h e f u n d f i n a n c i a l s t a t e m e n t s , t h e “ c u r r e n t f i n a n c i a l r e s o u r c e s ” m e a s u r e m e n t f o c u s o r t h e “ e c o n o m i c re s o u r c e s ” m e a s u r e m e n t f o c u s i s u s e d a s a p p r o p r i a t e . Al l g o v e r n m e n t a l f u n d s u t i l i z e a “ c u r r e n t f i n a n c i a l r e s o u r c e s ” m e a s u r e m e n t f o c u s . O n l y c u r r e n t fi n a n c i a l a s s e t s / d e f e r r e d o u t f l o w s a n d l i a b i l i t i e s / d e f e r r e d i n f l o w s a re g e n e r a l l y i n c l u d e d o n t h e i r ba l a n c e s h e e t s . T h e i r o p e r a t i n g s t a t e m e n t s p r e s e n t so u r c e s a n d u s e s o f a v a i l a b l e s p e n d a b l e f i n a n c i a l re s o u r c e s d u r i n g a g i v e n p e r i o d . T h e s e f u n d s u s e f u n d b a l a n c e a s t h e i r m e a s u r e o f a v a i l a b l e s p e n d a b l e fi n a n c i a l r e s o u r c e s a t t h e e n d o f t h e p e r i o d . Al l p r o p r i e t a r y a n d p e n s i o n t r u s t f u n d s u t i l i z e a n “ e c o n o m i c r e s o u r c e s ” m e a s u r e m e n t f o c u s . T h e ac c o u n t i n g o b j e c t i v e s o f t h i s m e a s u r e m e n t f o c u s a r e t h e d e t e r m i n a t i o n o f o p e r a t i n g i n c o m e , c h a n g e s i n ne t p o s i t i o n ( o r c o s t r e c o v e r y ) , f i n a n c i a l p o s i t i o n , a n d c a s h f l o w s . A l l a s s e t s / d e f e r r e d o u t f l o w s a n d li a b i l i t i e s / d e f e r r e d i n f l o w s ( w h e t h e r c u r r e n t o r n o n c u r r e n t ) a s s o c i a t e d w i t h t h e i r a c t i v i t i e s a r e r e p o r t e d . Pr o p r i e t a r y a n d p e n s i o n t r u s t f u n d e q u i t y i s c l a s s i f i e d a s n e t p o s i t i o n . Ag e n c y f u n d s a r e n o t i n v o l v e d i n t h e m e a s u r e m e n t o f r e s u l t s o f o p e r a t i o n s ; t h e r e f o r e , m e a s u r e m e n t fo c u s i s n o t a p p l i c a b l e t o t h e m . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 1 – S U M M A R Y O F S I G N I F I C A N T A C C O U N T I N G P O L I C I E S –Continued ME A S U R E M E N T F O C U S A N D B A S I S O F A C C O U N T I N G –Continued Ba s i s o f A c c o u n t i n g In t h e g o v e r n m e n t - w i d e S t a t e m e n t o f N e t P o s i t i o n a nd S t a t e m e n t o f A c t i v i t i e s , both governmental and bu s i n e s s - l i k e a c t i v i t i e s a r e p r e s e n t e d u s i n g t h e a c c r u a l b a s i s o f a c c o u n t i n g . U n d e r t h e a c c r u a l b a s i s o f ac c o u n t i n g , r e v e n u e s a r e r e c o g n i z e d w h e n e a r n e d a n d e x p e n s e s a r e r e c o r d e d w h e n t h e l i a b i l i t y / d e f e r r e d in f l o w s i s i n c u r r e d o r e c o n o m i c a s s e t u s e d . R e v e n u e s , e x p e n s e s , g a i n s , l o s s e s , a s s e t s / d e f e r r e d o u t f l o w s , an d l i a b i l i t i e s / d e f e r r e d i n f l o w s r e s u l t i n g f r o m e x c h a n g e a n d e x c h a n g e - l i k e t r a n s a c t i o n s a r e r e c o g n i z e d wh e n t h e e x c h a n g e t a k e s p l a c e . In t h e f u n d f i n a n c i a l s t a t e m e n t s , g o v e r n m e n t a l f u n d s a r e p r e s e n t e d o n t h e m o d i f i e d a c c r u a l b a s i s o f ac c o u n t i n g . U n d e r t h i s m o d i f i e d a c c r u a l b a s i s o f a c c o u n t i n g , r e v e n u e s a r e r e c o g n i z e d w h e n “m e a s u r a b l e a n d a v a i l a b l e . ” M e a s u r a b l e m e a n s k n o w i n g o r b e i n g a b l e t o r e a s o n a b l y e s t i m a t e t h e am o u n t . A v a i l a b l e m e a n s c o l l e c t i b l e w i t h i n t h e c u r r e n t p e r i o d o r w i t h i n s i x t y d a y s a f t e r y e a r - e n d . T h e Ci t y r e c o g n i z e s p r o p e r t y t a x e s w h e n t h e y b e c o m e b o t h m e a s u r a b l e a n d a v a i l a b l e i n a c c o r d a n c e w i t h GA S B C o d i f i c a t i o n S e c t i o n P 7 0 . A s i x t y d a y a v a i l a b i l i t y i s g e n e r a l l y u s e d f o r r e v e n u e r e c o g n i t i o n f o r a l l o t h e r g o v e r n m e n t a l f u n d re v e n u e s . I n c o m e t a x w i l l e x c e e d t h e s i x t y d a y r e c o g n i t i o n p e r i o d d u e t o t h e S t a t e o f I l l i n o i s a n d t h e lo n g d e l a y w i t h r e l e a s i n g t h e s e f u n d s . E x p e n d i t u r e s ( i n c l u d i n g c a p i t a l o u t l a y ) a r e r e c o r d e d w h e n t h e re l a t e d f u n d l i a b i l i t y i s i n c u r r e d , e x c e p t f o r g e n e r a l o b l i g a t i o n b o n d p r i n c i p a l a n d i n t e r e s t w h i c h a r e re c o g n i z e d w h e n d u e . In a p p l y i n g t h e s u s c e p t i b l e t o a c c r u a l c o n c e p t u n d e r t h e m o d i f i e d a c c r u a l b a s i s , t h o s e r e v e n u e s su s c e p t i b l e t o a c c r u a l a r e p r o p e r t y t a x e s , s t a t e a n d u t i l i t y t a x e s , f r a n c h i s e t a x e s , i n t e r e s t r e v e n u e , a n d ch a r g e s f o r s e r v i c e s . A l l o t h e r r e v e n u e s a r e n o t s u s c e p t i b l e t o a c c r u a l b e c a u s e g e n e r a l l y t h e y a r e n o t me a s u r a b l e u n t i l r e c e i v e d i n c a s h . Al l p r o p r i e t a r y , p e n s i o n t r u s t a n d a g e n c y f u n d s u t i l i z e t h e a c c r u a l b a s i s o f a c c o u n t i n g . U n d e r t h e ac c r u a l b a s i s o f a c c o u n t i n g , r e v e n u e s a r e r e c o g n i z e d w h e n e a r n e d a n d e x p e n s e s a r e r e c o r d e d w h e n t h e li a b i l i t y i s i n c u r r e d o r e c o n o m i c a s s e t u s e d . Pr o p r i e t a r y f u n d s d i s t i n g u i s h o p e r a t i n g r e v e n u e s a n d e x p e n s e s f r o m n o n o p e r a t i n g i t e m s . O p e r a t i n g re v e n u e s a n d e x p e n s e s g e n e r a l l y r e s u l t f r o m p r o v i d i n g s e r v i c e s a n d p r o d u c i n g a n d d e l i v e r i n g g o o d s i n co n n e c t i o n w i t h a p r o p r i e t a r y f u n d ’ s p r i n c i p a l o n g o i n g o p e r a t i o n s . T h e p r i n c i p a l o p e r a t i n g r e v e n u e s o f th e C i t y ’ s e n t e r p r i s e f u n d s a r e c h a r g e s t o c u s t o m e r s f o r s a l e s a n d s e r v i c e s . O p e r a t i n g e x p e n s e s f o r en t e r p r i s e f u n d s i n c l u d e t h e c o s t o f s a l e s a n d s e r v i c e s , a d m i n i s t r a t i v e e x p e n s e s , a n d d e p r e c i a t i o n o n ca p i t a l a s s e t s . A l l r e v e n u e s a n d e x p e n s e s n o t m e e t i n g t h i s d e f i n i t i o n a r e r e p o r t e d a s n o n o p e r a t i n g re v e n u e s a n d e x p e n s e s . 107 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 1 – S U M M A R Y O F S I G N I F I C A N T A C C O U N T I N G P O L I C I E S – C o n t i n u e d AS S E T S / D E F E R R E D O U T F L O W S , L I A B I L IT I E S / D E F E R R E D I N F L O W S , A N D N E T PO S I T I O N O R E Q U I T Y Ca s h a n d I n v e s t m e n t s Ca s h a n d c a s h e q u i v a l e n t s o n t h e S t a t e m e n t o f N e t P o s i t i o n a r e c o n s i d e r e d t o b e c a s h o n h a n d , d e m a n d de p o s i t s , a n d c a s h w i t h f i s c a l a g e n t . F o r t h e p u r p o s e o f t h e p r o p r i e t a r y f u n d s “ S t a t e m e n t o f C a s h Fl o w s , ” c a s h a n d c a s h e q u i v a l e n t s a r e c o n s i d e r e d t o b e c a s h o n h a n d , d e m a n d d e p o s i t s , c a s h w i t h f i s c a l ag e n t , a n d a l l h i g h l y l i q u i d i n v e s t m e n t s w i t h a n o r i g i n a l m a t u r i t y o f t h r e e m o n t h s o r l e s s . In v e s t m e n t s a r e r e p o r t e d a t f a i r va l u e . S h o r t - t e r m i n v e s t m e n t s a r e r e p o r t e d a t c o s t , w h i c h a p p r o x i m a t e s fa i r v a l u e . S e c u r i t i e s t r a d e d o n n a t i o n a l e x c h a n g e s a r e v a l u e d a t t h e l a s t r e p o r t e d s a l e s p r i c e . In v e s t m e n t s t h a t d o n o t h a v e a n y e s t a b l i s h e d m a r k e t , i f a n y , a r e r e p o r t e d a t e s t i m a t e d f a i r v a l u e . In t e r f u n d R e c e i v a b l e s , P a y a b l e s a n d A c t i v i t y In t e r f u n d a c t i v i t y i s r e p o r t e d a s l o a n s , s e r v i c e s p r o v i d e d , r e i m b u r s e m e n t s o r t r a n s f e r s . L o a n s a r e re p o r t e d a s i n t e r f u n d r e c e i v a b l e s a n d p a y a b l e s a s a p p r o p r i a t e a n d a r e s u b j e c t t o e l i m i n a t i o n u p o n co n s o l i d a t i o n . A l l o t h e r i n t e r f u n d t r a n s a c t i o n s a r e t r e a t e d a s t r a n s f e r s . A n y r e s i d u a l b a l a n c e s ou t s t a n d i n g b e t w e e n t h e g o v e r n m e n t a l a c t i v i t i e s a n d b u s i n e s s - t y p e a c t i v i t i e s a r e r e p o r t e d i n t h e go v e r n m e n t - w i d e f i n a n c i a l s t a t e m en t s a s “ i n t e r n a l b a l a n c e s . ” Re c e i v a b l e s In t h e g o v e r n m e n t - w i d e f i n a n c i a l s t at e m e n t s , r e c e i v a b l e s c o n s i s t o f a l l r e v e n u e s e a r n e d a t y e a r - e n d a n d no t y e t r e c e i v e d . M a j o r r e c e i v a b l e s b a l a n c e s f o r g o v e r n m e n t a l a c t i v i t i e s i n c l u d e p r o p e r t y t a x e s , s t a t e an d u t i l i t y t a x e s , f r a n c h i s e t a x e s , a n d g r a n t s . B u s i n es s - t y p e a c t i v i t i e s r e p o r t u t i l i t y c h a r g e s a s t h e i r ma j o r r e c e i v a b l e s . Pr e p a i d s Pr e p a i d s a r e v a l u e d a t c o s t , w h i c h a p p r o x i m a t e s m a r k e t . T h e c o s t o f g o v e r n m e n t a l f u n d - t y p e p r e p a i d s ar e r e c o r d e d a s e x p e n d i t u r e s w h e n c o n s u m e d r a t h e r t h a n w h e n p u r c h a s e d . C e r t a i n p a y m e n t s t o v e n d o r s re f l e c t c o s t s a p p l i c a b l e t o f u t u r e a c c o u n t i n g p e ri o d s a n d a r e r e c o r d e d a s p r e p a i d s i n b o t h t h e go v e r n m e n t - w i d e a n d f u n d f i n a n c i a l s t a t e m e n t s . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 1 – S U M M A R Y O F S I G N I F I C A N T A C C O U N T I N G P O L I C I E S –Continued AS S E T S / D E F E R R E D O U T F L O W S , L I A B I L IT I E S / D E F E R R E D I N F L O W S , A N D N E T PO S I T I O N O R E Q U I T Y – C o n t i n u e d Ca p i t a l A s s e t s Ca p i t a l a s s e t s p u r c h a s e d o r a c q u i r e d w i t h a n o r i g i n a l c o s t o f $ 5 , 0 0 0 t o $ 7 5 , 0 0 0 ( s e e b e l o w c h a r t ) o r mo r e a r e r e p o r t e d a t h i s t o r i c a l c o s t o r e s t i m a t e d h i s t o r i c a l c o s t . C o n t r i b u t e d a s s e t s a r e r e p o r t e d a t es t i m a t e d f a i r m a r k e t v a l u e a s o f t h e d a t e r e c e i v e d . A d d i t i o n s , i m p r o v e m e n t s a n d o t h e r c a p i t a l o u t l a y s th a t s i g n i f i c a n t l y e x t e n d t h e u s e f u l l i f e o f a n a s s e t a r e c a p i t a l i z e d . O t h e r c o s t s i n c u r r e d f o r r e p a i r s a n d ma i n t e n a n c e a r e e x p e n s e d a s i n c u r r e d . Th e a c c o u n t i n g a n d f i n a n c i a l r e p o r t i n g t r e a t m e n t a p p l i e d t o a f u n d i s d e t e r m i n e d b y i t s m e a s u r e m e n t fo c u s . G e n e r a l c a p i t a l a s s e t s a r e l o n g -l i v e d a s s e t s o f t h e C i t y a s a w hole. Infrastructure such as streets, tr a f f i c s i g n a l s a n d s i g n s a r e c a p i t a l i z e d . I n t h e c a s e o f t h e i n i t i a l c a p i t a l i z a t i o n o f g e n e r a l i n f r a s t r u c t u r e as s e t s ( i . e . , t h o s e r e p o r t e d b y t h e g o v e r n m e n t a l a c t i v i t i e s ) t h e g o v e r n m e n t c h o s e t o i n c l u d e a l l s u c h it e m s r e g a r d l e s s o f t h e i r a c q u i s i t i o n d a t e . T h e v a l u a t i o n b a s i s f o r g e n e r a l c a p i t a l a s s e t s a r e h i s t o r i c a l co s t , o r w h e r e h i s t o r i c a l c o s t i s n o t a v a i l a b l e , es t i m a t e d h i s t o r i c a l c o s t b a s e d o n r e p l a c e m e n t c o s t s . Ca p i t a l a s s e t s i n t h e p r o p r i e t a r y f u n d s a r e c a p i t a l i z e d i n t h e f u n d i n w h i c h t h e y a r e u t i l i z e d . T h e va l u a t i o n b a s e s f o r p r o p r i e t a r y f u n d c a p i t a l a s s e t s a r e th e s a m e a s t h o s e u s e d for the general capital as s e t s . D o n a t e d c a p i t a l a s s e t s a r e c a p i t a l i z e d a t e s t i m a t e d f a i r m a r k e t v a l u e o n t h e d a t e d o n a t e d . De p r e c i a t i o n o n a l l a s s e t s i s c o m p u t e d a n d r e c o r d e d u s i n g t h e s t r a i g h t - l i n e m e t h o d o f d e p r e c i a t i o n o v e r th e f o l l o w i n g e s t i m a t e d u s e f u l l i v e s : Estimated Useful Ca p i t a l A s s e t L i f e La n d $ 2 5 , 0 0 0 N / A La n d I m p r o v e m e n t s 2 5 , 0 0 0 N / A Bu i l d i n g s 3 5 , 0 0 0 1 0 - 5 0 Y e a r s Bu i l d i n g I m p r o v e m e n t s 2 5 , 0 0 0 1 0 - 2 0 Y e a r s Ma c h i n e r y a n d E q u i p m e n t 5 , 0 0 0 5 - 7 5 Y e a r s Ve h i c l e s 5 , 0 0 0 5 - 1 5 Y e a r s So f t w a r e 2 5 , 0 0 0 2 - 5 Y e a r s In f r a s t r u c t u r e - S t r e e t a n d S t o r m S e w e r 5 0 , 0 0 0 1 0 - 7 5 Y e a r s In f r a s t r u c t u r e - W a t e r a n d S e w e r 7 5 , 0 0 0 1 0 - 7 5 Y e a r s Capitalized Threshold 108 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 1 – S U M M A R Y O F S I G N I F I C A N T A C C O U N T I N G P O L I C I E S – Co n t i n u e d AS S E T S / D E F E R R E D O U T F L O W S , L I A B I L IT I E S / D E F E R R E D I N F L O W S , A N D N E T PO S I T I O N O R E Q U I T Y – Co n t i n u e d Co m p e n s a t e d A b s e n c e s Th e C i t y a c c r u e s a c c u m u l a t e d u n p a i d v a c a t i o n a n d a s s o c i a t e d e m p l o y e e - r e l a t e d c o s t s w h e n e a r n e d ( o r es t i m a t e d t o b e e a r n e d ) b y t h e e m p l o y e e . I n a c c o r d a n c e w i t h G A S B S t a t e m e n t N o . 1 6 , n o l i a b i l i t y i s re c o r d e d f o r n o n v e s t i n g a c c u m u l a t i o n r i g h t s t o r e c e i v e s i c k p a y b e n e f i t s . H o w e v e r , a l i a b i l i t y i s re c o g n i z e d f o r t h a t p o r t i o n o f a c c u m u l a t e d s i c k l e a v e t h a t i s e s t i m a t e d t o b e t a k e n a s “ t e r m i n a l l e a v e ” pr i o r t o r e t i r e m e n t . A l l v a c a t i o n p a y i s a c c r u e d w h en i n c u r r e d i n t h e g o v e r n m e n t - w i d e a n d p r o p r i e t a r y fu n d f i n a n c i a l s t a t e m e n t s . A l i a b i l i t y f o r t h e s e a m o u n t s i s r e p o r t e d i n t h e g o v e r n m e n t a l f u n d s o n l y i f th e y h a v e m a t u r e d , f o r e x a m p l e , a s a r e s u l t o f e m p l o y e e r e s i g n a t i o n s a n d r e t i r e m e n t s . As s e t s H e l d f o r O t h e r s In J u n e o f 2 0 0 4 , t h e C i t y e n t e r e d i n t o a n i n t e r g o v e r n m e n t a l a g r e e m e n t w i t h Y o r k v i l l e - B r i s t o l S a n i t a r y Di s t r i c t f o r d e s i g n a n d c o n s t r u c t i o n o f t h e R o b R o y C r e e k I n t e r c e p t o r . A t t h e d a t e o f c o m p l e t i o n , t h e Yo r k v i l l e - B r i s t r o l S a n i t a r y D i s t r i c t o w n s a n d m a i n t a in s t h e I n t e r c e p t o r . A l l c o s t s a s s o c i a t e d w i t h t h e co n s t r u c t i o n o f t h e i n f r a s t r u c t u r e a s s e t a r e r e c o r d e d a s A s s e t s H e l d f o r O t h e r s i n t h e C i t y ’ s f i n a n c i a l st a t e m e n t s . A s o f A p r i l 3 0 , 2 0 1 3 , t h e b a l a n c e o f t h i s p r o j e c t w a s $ 1 1 , 0 9 1 , 0 0 0 r e p o r t e d i n t h e S e w e r Fu n d . I n c o n n e c t i o n w i t h t h i s p r o j e c t , t h e C i t y i s s u e d G e n e r a l O b l i g a t i o n A l t e r n a t e R e v e n u e S o u r c e Bo n d s o f 2 0 0 5 D i n t h e f i s c a l y e a r 2 0 0 6 f o r $ 1 1 , 3 0 0 , 0 0 0 , w h i c h w e r e r e f u n d e d i n 2 0 0 8 a n d a g a i n i n 20 1 1 . A t A p r i l 3 0 , 2 0 1 3 , t h e o u t s t a n d i n g b a l a n c e o f t h e 2 0 1 1 r e f u n d i n g b o n d s i s $ 1 1 , 1 5 0 , 0 0 0 . S e e N o t e 3 f o r m o r e i n f o r m a t i o n o n t h i s l o n g - t e r m d e b t i s s u e . Lo n g - T e r m O b l i g a t i o n s In t h e g o v e r n m e n t - w i d e f i n a n c i a l s t a t e m e n t s , a n d p r o p r i e t a r y f u n d t y p e s i n t h e f u n d f i n a n c i a l st a t e m e n t s , l o n g - t e r m d e b t a n d o t h e r l o n g - t e r m o b l i g a t i o n s a r e r e p o r t e d a s l i a b i l i t i e s i n t h e a p p l i c a b l e go v e r n m e n t a l a c t i v i t i e s , b u s i n e s s - t y p e a c t i v i t i e s , o r p r o p r i e t a r y f u n d t y p e S t a t e m e n t o f N e t P o s i t i o n . Bo n d p r e m i u m s a n d d i s c o u n t s a r e d e f e r r e d a n d a m o r t i z e d o v e r t h e l i f e o f t h e b o n d s u s i n g t h e e f f e c t i v e in t e r e s t m e t h o d . B o n d s p a y a b l e a r e r e p o r t e d n e t o f t h e a p p l i c a b l e b o n d p r e m i u m o r d i s c o u n t . B o n d is s u a n c e c o s t s a r e r e p o r t e d a s e x p e n d i t u r e s / e x p e n s e s a t t h e t i m e o f i s s u a n c e . In t h e f u n d f i n a n c i a l s t a t e m e n t s , g o v e r n m e n t a l f u n d t y p e s r e c o g n i z e b o n d p r e m i u m s a n d d i s c o u n t s , a s we l l a s b o n d i s s u a n c e c o s t s , d u r i n g t h e c u r r e n t p e r i o d . T h e f a c e a m o u n t o f d e b t i s s u e d i s r e p o r t e d a s ot h e r f i n a n c i n g s o u r c e s . P r e m i u m s r e c e i v e d o n d e b t is s u a n c e s a r e r e p o r t e d a s o t h e r f i n a n c i n g s o u r c e s wh i l e d i s c o u n t s o n d e b t i s s u a n c e s a r e r e p o r t e d a s o t h e r f i n a n c i n g u s e s . I s s u a n c e c o s t s , w h e t h e r o r n o t wi t h h e l d f r o m t h e a c t u a l d e b t p r o c e e d s r e c e i v e d , a r e r e p o r t e d a s d e b t s e r v i c e e x p e n d i t u r e s . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 1 – S U M M A R Y O F S I G N I F I C A N T A C C O U N T I N G P O L I C I E S – Continued AS S E T S / D E F E R R E D O U T F L O W S , L I A B I L IT I E S / D E F E R R E D I N F L O W S , A N D N E T PO S I T I O N O R E Q U I T Y – Co n t i n u e d Ne t P o s i t i o n In t h e g o v e r n m e n t - w i d e f i n a n c i a l s t a t e m e n t s , e q u i t y is c l a s s i f i e d a s n e t p o s i t i o n a n d d i s p l a y e d i n t h r e e co m p o n e n t s : Ne t i n v e s t m e n t i n c a p i t a l a s s e t s — C o n s i s t s o f c a pital assets including re s t r i c t e d c a p i t a l a s s e t s , n e t o f a c c u m u l a t e d d e p r e c i a t i o n a n d r e d u c e d b y th e o u t s t a n d i n g b a l a n c e s o f a n y b o n d s , m o r t g a g e s , n o t e s o r o t h e r bo r r o w i n g s t h a t a r e a t t r i b u t a b l e t o t h e a c q u i s i t i o n , c o n s t r u c t i o n , o r im p r o v e m e n t o f t h o s e a s s e t s . Re s t r i c t e d — C o n s i s t s o f n e t p o s i t i o n w i t h c o n s t r a i n t s p l a c e d o n t h e u s e ei t h e r b y ( 1 ) e x t e r n a l g r o u p s s u c h a s c r e d i t o r s , g r a n t o r s , c o n t r i b u t o r s , o r la w s o r r e g u l a t i o n s o f o t h e r g o v e r n m e n t s; o r ( 2 ) l a w t h r o u g h c o n s t i t u t i o n a l pr o v i s i o n s o r e n a b l i n g l e g i s l a t i o n s . Un r e s t r i c t e d — A l l o t h e r n e t p o s i t i o n b a l a n c e s t h a t d o n o t m e e t t h e de f i n i t i o n o f “ r e s t r i c t e d ” o r “ n e t i n v e s t m e n t i n c a p i t a l a s s e t s . ” NO T E 2 – S T E W A R D S H I P , C O M P L I A N C E , A N D A C C O U N T A B I L I T Y BU D G E T A R Y I N F O R M A T I O N Bu d g e t s a r e a d o p t e d o n a b a s i s c o n s i s t e n t w i t h g e n e r a l l y a c c e p t e d a c c o u n t i n g p r i n c i p l e s . A n n u a l bu d g e t s a r e a d o p t e d f o r a l l f u n d s . A l l a n n u a l a p p r o p r i a t i o n s l a p s e a t f i s c a l y e a r e n d . D u r i n g t h e y e a r , se v e r a l s u p p l e m e n t a r y a p p r o p r i a t i o n s w e r e n e c e s s a r y . T h e C i t y f o l l o w s t h e s e p r o c e d u r e s i n e s t a b l i s h i n g th e b u d g e t a r y d a t a r e f l e c t e d i n t h e f i n a n c i a l s t a t e m e n t s : x Pr i o r t h e M a y 1 , t h e M a y o r s u b m i t s t o t h e C i t y C o u n c i l t h e p r o p o s e d b u d g e t f o r t h e f i s c a l y e a r co m m e n c i n g t h e f o l l o w i n g M a y 1 . T h e o p e r a t i n g b u d g e t i n c l u d e s p r o p o s e d e x p e n d i t u r e s a n d t h e me a n s o f f i n a n c i n g t h e m . x Pu b l i c h e a r i n g s a r e c o n d u c t e d a t t h e C i t y o f f i c e s t o o b t a i n t a x p a y e r c o m m e n t s . x Pr i o r t o M a y 1 , t h e b u d g e t i s l e g a l l y a d o p t e d b y a v o t e o f t h e C i t y C o u n c i l t h r o u g h p a s s a g e o f an o r d i n a n c e . x Th e b u d g e t o f f i c e r i s a u t h o r i z e d t o t r a n s f e r b u d g e t e d a m o u n t s b e t w e e n d e p a r t m e n t s w i t h i n a n y fu n d ; h o w e v e r , a n y r e v i s i o n s t h a t a l t e r t h e t o t a l e x p e n d i t u r e s o f a n y f u n d m u s t b e a p p r o v e d b y th e C i t y C o u n c i l . DE F I C I T F U N D E Q U I T Y Th e R e c r e a t i o n a n d M u n i c i p a l B u i l d i n g F u n d s h a d d e f i c i t f u n d e q u i t y o f $ 3 0 1 , 6 2 4 a n d $ 5 7 1 , 6 1 5 , re s p e c t i v e l y , a s o f A p r i l 3 0 , 2 0 1 3 . 109 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S DE P O S I T S A N D I N V E S T M E N T S Th e C i t y m a i n t a i n s a c a s h a n d i n v e s t m e n t p o o l t h a t i s a v a i l a b l e f o r u s e b y a l l f u n d s e x c e p t t h e p e n s i o n tr u s t f u n d . E a c h f u n d t y p e ' s p o r t i o n o f t h i s p o o l i s d i s p l a y e d o n t h e f i n a n c i a l s t a t e m e n t s a s " c a s h a n d in v e s t m e n t s . ” I n a d d i t i o n , i n v e s t m e n t s a r e s e p a r a t e l y h e l d b y s e v e r a l o f t h e C i t y ' s f u n d s . T h e d e p o s i t s an d i n v e s t m e n t s o f t h e p e n s i o n t r u s t f u n d a r e h e l d s e p a r a t e l y f r o m t h o s e o f o t h e r f u n d s . Pe r m i t t e d D e p o s i t s a n d I n v e s t m e n t s – S t a t u t e s a u t h o r i z e t h e C i t y t o m a k e d e p o s i t s / i n v e s t i n c o m m e r c i a l ba n k s , s a v i n g s a n d l o a n i n s t i t u t i o n s , o b l i g a t i o n s o f t h e U . S . T r e a s u r y a n d U . S . A g e n c i e s , o b l i g a t i o n s o f St a t e s a n d t h e i r p o l i t i c a l s u b d i v i s i o n s , c r e d i t u n i o n s h a r e s , r e p u r c h a s e a g r e e m e n t s , c o m m e r c i a l p a p e r ra t e d w i t h i n t h e t h r e e h i g h e s t c l a s s i f i c a t i o n s b y a t l e a s t t w o s t a n d a r d r a t i n g s e r v i c e s , I l l i n o i s F u n d s a n d th e I l l i n o i s M e t r o p o l i t a n I n v e s t m e n t F u n d ( I M E T ) . Th e d e p o s i t s a n d i n v e s t m e n t s o f t h e P e n s i o n F u n d a r e h e l d s e p a r a t e l y f r o m t h o s e o f o t h e r C i t y f u n d s . St a t u t e s a u t h o r i z e t h e P e n s i o n F u n d t o m a k e d e p o s i t s / i n v e s t i n i n t e r e s t b e a r i n g d i r e c t o b l i g a t i o n s o f t h e Un i t e d S t a t e s o f A m e r i c a ; o b l i g a t i o n s t h a t a r e f u l l y g u a r a n t e e d o r i n s u r e d a s t o t h e p a y m e n t o f p r i n c i p a l an d i n t e r e s t b y t h e U n i t e d S t a t e s o f A m e r i c a ; b o n d s , n o t e s , d e b e n t u r e s , o r s i m i l a r o b l i g a t i o n s o f ag e n c i e s o f t h e U n i t e d S t a t e s o f A m e r i c a ; s a v i n g s a c c o u n t s o r c e r t i f i c a t e s o f d e p o s i t i s s u e d b y b a n k s o r sa v i n g s a n d l o a n a s s o c i a t i o n s c h a r t e r e d b y t h e U n i t e d S t a t e s o f A m e r i c a o r b y t h e S t a t e o f I l l i n o i s , t o th e e x t e n t t h a t t h e d e p o s i t s a r e i n s u r e d b y t h e a g e n c i e s o r i n s t r u m e n t a l i t i e s o f t h e f e d e r a l g o v e r n m e n t ; St a t e o f I l l i n o i s B o n d s ; p o o l e d a c c o u n t s m a n a g e d b y t h e I l l i n o i s P u b l i c T r e a s u r e r , o r b y b a n k s , t h e i r su b s i d i a r i e s o r h o l d i n g c o m p a n i e s , i n a c c o r d a n c e w i t h t h e l a w s o f t h e S t a t e o f I l l i n o i s ; b o n d s o r t a x an t i c i p a t i o n w a r r a n t s o f a n y c o u n t y , t o w n s h i p , o r m u n i c i p a l c o r p o r a t i o n o f t h e S t a t e o f I l l i n o i s d i r e c t ob l i g a t i o n s o f t h e S t a t e o f I s r a e l ; m o n e y m a r k e t m u t u a l f u n d s m a n a g e d b y i n v e s t m e n t c o m p a n i e s t h a t ar e r e g i s t e r e d u n d e r t h e f e d e r a l I n v e s t m e n t C o m p a n y A c t o f 1 9 4 0 a n d t h e I l l i n o i s S e c u r i t i e s L a w o f 19 5 3 a n d a r e d i v e r s i f i e d , o p e n - e n d e d m a n a g e m e n t i n v e s t m e n t c o m p a n i e s , p r o v i d e d t h e p o r t f o l i o i s li m i t e d t o s p e c i f i e d r e s t r i c t i o n s ; g e n e r a l a c c o u n t s o f l i f e i n s u r a n c e c o m p a n i e s a n d s e p a r a t e a c c o u n t s o f li f e i n s u r a n c e c o m p a n i e s p r o v i d e d t h e i n v e s t m e n t i n s e p a r a t e a c c o u n t s d o e s n o t e x c e e d t e n p e r c e n t o f th e p e n s i o n f u n d ’ s n e t a s s e t s . P e n s i o n f u n d s o f a t l e a s t 5 m i l l i o n t h a t h a v e a p p o i n t e d a n i n v e s t m e n t ad v i s o r m a y , t h r o u g h t h a t i n v e s t m e n t a d v i s o r , i n v e s t u p t o t h i r t y - f i v e p e r c e n t o f t h e p l a n ’ s n e t a s s e t s i n co m m o n a n d p r e f e r r e d s t o c k s t h a t m e e t s p e c i f i c r e s t r i c t i o n s . Il l i n o i s F u n d s a n d I M E T a r e i n v e s t m e n t p o o l s m a n a g e d b y t h e I l l i n o i s p u b l i c T r e a s u r e r ’ s O f f i c e w h i c h al l o w s g o v e r n m e n t s w i t h i n t h e S t a t e t o p o o l t h e i r f u n d s f o r i n v e s t m e n t p u r p o s e s . A l t h o u g h n o t re g i s t e r e d w i t h t h e S E C , I l l i n o i s F u n d s a n d I M E T o p e r a t e i n a m a n n e r c o n s i s t e n t w i t h R u l e 2 a 7 o f t h e In v e s t m e n t C o m p a n y A c t o f 1 9 4 0 . I n v e s t m e n t s i n I l l i n o i s F u n d s a n d I M E T a r e v a l u e d a t t h e s h a r e pr i c e , t h e p r i c e f o r w h i c h t h e i n v e s t m e n t c o u l d b e s o l d . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – C o n t i n u e d DE P O S I T S A N D I N V E S T M E N T S – C o n t i n u e d Ci t y I n t e r e s t R a t e R i s k , C r e d i t R i s k , C u s to d i a l C r e d i t R i s k a n d C o n c e n t r a t i o n R i s k De p o s i t s . At y e a r - e n d , t h e c a r r y i n g a m o u n t o f t h e C i t y ’ s d e p o s i t s f o r g o v e r n m e n t a l a n d b u s i n e s s - t y p e ac t i v i t i e s t o t a l e d $ 1 , 2 3 6 , 2 9 6 a n d t h e b a n k b a l a n c e s t o t a l e d $ 1 , 3 6 6 , 4 3 7 . A d d i t i o n a l l y , t h e C i t y h a s $2 , 1 4 7 , 5 9 7 i n v e s t e d i n t h e I l l i n o i s F u n d a n d $ 7 , 7 8 3 , 4 0 8 i n v e s t e d i n I M E T a t y e a r - e n d . In t e r e s t R a t e R i s k . In t e r e s t r a t e r i s k i s t h e r i s k t h a t c h a n g e s i n i n t e r e s t r a t e s w i l l a d v e r s e l y a f f e c t t h e f a i r va l u e o f a n i n v e s t m e n t . T h e C i t y ’ s i n v e s t m e n t p o l i c y st a t e s t h a t a v a r i e t y o f f i n a n c i a l i n s t r u m e n t s a n d ma t u r i t i e s , p r o p e r l y b a la n c e d , w i l l h e l p t o i n s u r e l i q u i d i t y a n d r e ducerisk or interest rate volatility and lo s s o f p r i n c i p a l . T h e p o l i c y d o e s n o t s t a t e s p e c i f ic l i m i t s i n i n v e s t m e n t m a turities as a means of ma n a g i n g i t s e x p o s u r e t o f a i r v a l u e l o s s e s a r i s i n g f r o m i n c r e a s i n g i n t e r e s t r a t e s . A t y e a r - e n d , t h e C i t y ’ s in v e s t m e n t i n t h e I l l i n o i s F u n d s a n d I M E T h a v e a n a v e r a g e m a t u r i t y o f l e s s t h a n o n e y e a r . Cr e d i t R i s k . Cr e d i t r i s k i s t h e r i s k t h a t a n i s s u e r o r o t h e r c o u n t e r p a r t y t o a n i n v e s t m e n t w i l l n o t f u l f i l l i t s ob l i g a t i o n s . I n v e s t m e n t s s h a l l b e ma d e w i t h j u d g m e n t a n d c a r e , u n d e r c i r c u m s t a n c e s t h e n p r e v a i l i n g , wh i c h p e r s o n s o f p r u d e n c e , d i s c r e t i o n a n d i n t e l l i g e n c e e x e r c i s e i n m a n a g e m e n t o f t h e i r o w n a f f a i r s , n o fo r s p e c u l a t i o n , b u t f o r i n v e s t m e n t , c o n s i d e r i n g t h e s a f e t y o f t h e i r c a p i t a l , a s w e l l a s t h e p r o b a b l e in c o m e t o b e d e r i v e d . T h e s t a n d a r d o f p r u d e n c e t o b e u s e d b y i n v e s t m e n t o f f i c i a l s s h a l l b e t h e ‘ p r u d e n t pe r s o n ’ s t a n d a r d a n d s h a l l b e a p p l i e d i n t h e c o n t e x t o f m a n a g i n g a n o v e r a l l p o r t f o l i o . A t y e a r - e n d , t h e Ci t y ’ s i n v e s t m e n t i n t h e I l l i n o i s F u n d s i s r a t e d A A A m b y S t a n d a r d & P o o r ’ s a n d t h e C i t y ’ s i n v e s t m e n t in t h e I M E T C o n v e n i e n c e F u n d i s r a t e d A A A f b y S t a n d a r d a n d P o o r ’ s . Cu s t o d i a l C r e d i t R i s k . In t h e c a s e o f d e p o s i t s , t h i s i s t h e r i s k that in the event of a bank failure, the Ci t y ’ s d e p o s i t s m a y n o t b e r e t u r n e d t o i t . T h e C i t y ’ s i n v e s t m e n t p o l i c y r e q u i r e s t h a t a l l a m o u n t s i n ex c e s s o f a n y i n s u r a n c e l i m i t s b e c o l l a t e r a l i z e d b y a p p r o v e d s e c u r i t i e s o r s u r e t y b o n d s i s s u e d b y t o p - ra t e d i n s u r e r s , h a v i n g a v a l u e o f a t l e a s t 1 1 0 % o f th e d e p o s i t s . C o l l a t e r a l i s r e q u i r e d a s s e c u r i t y wh e n e v e r d e p o s i t s e x c e e d t h e i n s u r a n c e l i m i t s o f t h e F D I C . R e p u r c h a s e a g r e e m e n t s m u s t a l s o b e co l l a t e r a l i z e d i n t h e a m o u n t o f 1 0 5 % o f t h e m a r k e t v a l u e o f p r i n c i p a l a n d a c c r u e d i n t e r e s t . C o l l a t e r a l sh a l l b e h e l d a t a n i n d e p e n d e n t , t h ir d p a r t y i n s t i t u t i o n i n t h e n a m e o f the City. The third party institution sh a l l c o m p l y w i t h a l l q u a l i f i c a t i o n s a n d r e q u i r e m e n t s a s s e t f o r t h i n t h e I l l i n o i s C o m p l i e d S t a t u t e s 3 0 IL C S 2 3 5 / 6 . A t y e a r e n d , a l l d e p o s i t s a r e c o l l a t e r a l i z e d . Fo r a n i n v e s t m e n t , t h i s i s t h e r i s k t h a t i n t h e e v e n t o f t h e f a i l u r e o f t h e c o u n t e r p a r t y , t h e C i t y w i l l n o t b e ab l e t o r e c o v e r t h e v a l u e o f i t s i n v e s t m e n t s o r c o l l a t e r a l s e c u r i t i e s t h a t a r e i n t h e p o s s e s s i o n o f a n ou t s i d e p a r t y . A t y e a r - e n d , t h e C i t y ’ s i n v e s t m e n t i n t h e I l l i n o i s F u n d a n d I M E T a r e n o n c a t e g o r i z a b l e . 110 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – C o n t i n u e d DE P O S I T S A N D I N V E S T M E N T S – Co n t i n u e d Ci t y I n t e r e s t R a t e R i s k , C r e d i t R i s k , C u s to d i a l C r e d i t R i s k a n d C o n c e n t r a t i o n R i s k – C o n t i n u e d Co n c e n t r a t i o n R i s k . Th i s i s t h e r i s k o f l o s s a t t r i b u t e d t o t h e m a g n i t u d e o f t h e C i t y ’ s i n v e s t m e n t i n a si n g l e i s s u e r . T h e C i t y ’ s i n v e s t m e n t p o l i c y s t a t e s t h at a v a r i e t y o f f i n a n c i a l in s t r u m e n t s a n d m a t u r i t i e s , pr o p e r l y b a l a n c e d , w i l l h e l p t o i n s u r e l i q u i d i t y a n d r e d u c e r i s k o r i n t e r e s t r a t e v o l a t i l i t y a n d l o s s o f pr i n c i p a l . D i v e r s i f y i n g i n s t r u m e nt s a n d m a t u r i t i e s w i l l a v o i d i n c u r r i n g u n r e a s o n a b l e r i s k s i n t h e in v e s t m e n t p o r t f o l i o r e g a r d i n g s p e c i fi c s e c u r i t y t y p e s , i s s u e r s o r i n d i v i d u a l f i n a n c i a l i n s t i t u t i o n s . T h e Ci t y s h a l l d i v e r s i f y t o t h e b e s t o f i t s a b i l i t y b a s e d o n t h e t y p e o f f u n d s i n v e s t e d a n d t h e c a s h f l o w n e e d s of t h o s e f u n d s . T h e C i t y p l a c e s n o l i m i t o n t h e a m o u n t t h e C i t y m a y i n v e s t i n a n y o n e i s s u e r . A t y e a r - en d , t h e C i t y ’ s i n v e s t m e n t i n I l l i n o i s F u n d s a n d i n I M E T r e p r e s e n t m o r e t h a n 5 p e r c e n t o f t h e t o t a l c a s h an d i n v e s t m e n t p o r t f o l i o . Po l i c e P e n s i o n F u n d I n t e r e s t R a t e R i s k , C r e d i t R i s k , C u s t o d i a l C r e d i t R i s k a n d C o n c e n t r a t i o n Ri s k De p o s i t s . At y e a r - e n d , t h e c a r r y i n g a m o u n t o f t h e F u n d ’ s d e p o s i t s t o t a l e d $ 4 3 1 , 7 3 3 a n d t h e b a n k ba l a n c e s t o t a l e d $ 4 3 1 , 7 3 3 . In v e s t m e n t s . At y e a r - e n d , t h e F u n d h a s t h e f o l l o w i n g i n v e s t m e n t s a n d m a t u r i t i e s : Le s s T h a n Mo r e T h a n In v e s t m e n t T y p e 1 1 t o 5 6 t o 1 0 1 0 U. S . T r e a s u r y N o t e s $ 72 4 , 5 5 1 - 4 0 4 , 7 9 6 3 1 9 , 7 5 5 - U. S . T r e a s u r y S t r i p s 16 1 , 3 2 0 7 9 , 9 1 9 - 8 1 , 4 0 1 - U. S . T r e a s u r y B o n d s 10 6 , 5 4 7 - - 1 0 6 , 5 4 7 - Fe d e r a l H o m e L o a n M o r t g a g e C o r p . 2 2 4 , 7 5 5 - 1 0 0 , 0 9 9 1 2 4 , 6 5 6 - Fe d e r a l F a r m C r e d i t B u r e a u 11 0 , 0 0 2 - 1 1 0 , 0 0 2 - - Fe d e r a l N a t i o n a l M o r t g a g e A s s o c . 65 9 , 0 2 1 1 6 1 , 8 1 7 - 3 4 0 , 3 0 6 1 5 6 , 8 9 8 Go v e r n m e n t N a t i o n a l M o r t g a g e A s s o c . 3 0 , 1 2 9 - - - 3 0 , 1 2 9 Co r p o r a t e B o n d s 31 1 , 9 2 2 - 2 8 2 , 7 9 3 2 9 , 1 2 9 - 2, 3 2 8 , 2 4 7 2 4 1 , 7 3 6 8 9 7 , 6 9 0 1 , 0 0 1 , 7 9 4 1 8 7 , 0 2 7 In v e s t m e n t M a t u r i t i e s ( i n Y e a r s ) Fa i r Va l u e UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – C o n t i n u e d DE P O S I T S A N D I N V E S T M E N T S – Co n t i n u e d Po l i c e P e n s i o n F u n d I n t e r e s t R a t e R i s k , C r e d i t R i s k , C u s t o d i a l C r e d i t R i s k a n d C o n c e n t r a t i o n Ri s k – C o n t i n u e d In t e r e s t R a t e R i s k . Th e F u n d ’ s i n v e s t m e n t p o l i c y s t a t e s t h a t n o m o r e t h a n 5 % o f p l a n a s s e t s s h a l l b e in v e s t e d i n l i q u i d , l o n g - t e r m i n v e s t m e n t s . S u c h i n v e s t m e n t m a y i n c l u d e c e r t i f i c a t e s o f d e p o s i t a n d gu a r a n t e e d i n s u r a n c e c o n t r a c t s . A n y o t h e r p l a n h o l d i n g w h i c h w o u l d h a v e a n o t i c e a b l e i m p a c t o n ma r k e t p r i c e i n w h o l e o r i n p a r t i s a l s o d e f i n e d a s l i q u i d . Cr e d i t R i s k . Th e F u n d ’ s i n v e s t m e n t p o l i c y h e l p s l i m i t i t s e x p o s u r e t o c r e d i t r i s k b y p r i m a r i l y i n v e s t i n g in s e c u r i t i e s i s s u e d b y t h e U n i t e d S t a t e s G o v e r n m e n t a n d / o r i t s a g e n c i e s t h a t a r e i m p l i c i t l y g u a r a n t e e d by t h e U n i t e d S t a t e s G o v e r n m e n t . T h e i n v e s t m e n t s i n t h e s e c u r i t i e s o f t h e U n ited States Government ag e n c i e s w e r e a l l r a t e d T r i p l e A o r D o u b l e A b y S t a n d a r d & P o o r ’ s a n d b y M o o d y ’ s I n v e s t o r S e r v i c e s . Th e F u n d ’ s p o l i c y p r e s c r i b e t o t h e “ p r u d e n t p e r s o n ” ru l e w h i c h s t a t e s , “ I n v e s t m e nts shall be made with ju d g m e n t a n d c a r e , u n d e r c i r c u m s t a n c e s t h e n p r e v a i l i n g , w h i c h p e r s o n s o f p r u d e n c e , d i s c r e t i o n a n d in t e l l i g e n c e e x e r c i s e i n t h e m a n a g e m e n t o f t h e i r o w n a f f a i r s , n o t f o r s p e c u l a t i o n , b u t f o r i n v e s t m e n t , co n s i d e r i n g t h e p r i m a r y o b j e c t i v e o f s a f e t y a s w e l l s t h e s e c o n d o b j e c t i v e o f t h e a t t a i n m e n t o f m a r k e t ra t e s o f r e t u r n . Cu s t o d i a l C r e d i t R i s k . Th e F u n d ’ s i n v e s t m e n t p o l i c y d o e s n o t a d d r e s s c u s t o d i a l c r e d i t r i s k . Co n c e n t r a t i o n R i s k . Th e F u n d ’ s i n v e s t m e n t p o l i c y d o e s n o t a d d r e s s c o n c e n t r a t i o n r i s k . I n a d d i t i o n t o th e s e c u r i t i e s a n d f a i r v a l u e s p r e v i o u s l y l i s t e d , t h e F u n d a l s o h a s $ 2 , 2 7 1 , 5 8 9 i n v e s t e d i n m u t u a l f u n d s . At y e a r - e n d , t h e F u n d h a s o v e r 5 p e r c e n t o f n e t p l a n p o s i t i o n a v a i l a b l e f o r r e t i r e m e n t b e n e f i t s ( o t h e r th a n U . S . G o v e r n m e n t g u a r a n t e e d o b l i g a t i o n s ) i n v e s t e d i n S c h w a b S & P 5 0 0 I n d e x F u n d ( $ 5 9 0 , 5 4 1 ) . PR O P E R T Y T A X E S Pr o p e r t y t a x e s f o r 2 0 1 2 a t t a c h a s a n e n f o r c e a b l e l i e n o n J a n u a r y 1 , 2 0 1 3 , o n p r o p e r t y v a l u e s a s s e s s e d a s of t h e s a m e d a t e . T a x e s a r e l e v i e d b y D e c e m b e r o f t h e s u b s e q u e n t f i s c a l y e a r ( b y p a s s a g e o f a T a x L e v y Or d i n a n c e ) . T a x b i l l s a r e p r e p a r e d b y t h e C o u n t y a n d a r e p a y a b l e i n t w o i n s t a l l m e n t s , o n o r a b o u t J u n e 1, 2 0 1 3 , a n d S e p t e m b e r 1 , 2 0 1 3 . T h e C o u n t y c o l l e c t s s u c h t a x e s a n d r e m i t s t h e m p e r i o d i c a l l y . 111 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d CA P I T A L A S S E T S Go v e r n m e n t a l A c t i v i t i e s Go v e r n m e n t a l c a p i t a l a s s e t a c t i v i t y f o r t h e y e a r w a s a s f o l l o w s : En d i n g In c r e a s e s D e c r e a s e s B a l a n c e s No n d e p r e c i a b l e C a p i t a l A s s e t s La n d $ 2 9 , 9 3 3 , 1 7 9 3 3 3 , 0 0 0 - 3 0 , 2 6 6 , 1 7 9 Co n s t r u c t i o n i n P r o g r e s s 2 9 1 , 1 1 3 5 6 4 , 6 5 5 1 0 1 , 5 1 7 7 5 4 , 2 5 1 30 , 2 2 4 , 2 9 2 8 9 7 , 6 5 5 1 0 1 , 5 1 7 3 1 , 0 2 0 , 4 3 0 De p r e c i a b l e C a p i t a l A s s e t s Bu i l d i n g s 1 4 , 5 7 3 , 5 5 6 - - 1 4 , 5 7 3 , 5 5 6 Eq u i p m e n t 5 , 8 0 9 , 1 0 1 4 5 3 , 2 5 1 8 , 5 0 0 6 , 2 5 3 , 8 5 2 Ve h i c l e s 2 , 3 6 4 , 8 0 9 6 0 , 2 9 0 - 2 , 4 2 5 , 0 9 9 In f r a s t r u c t u r e 4 0 , 6 8 8 , 9 5 6 2 , 5 8 7 , 2 5 6 - 4 3 , 2 7 6 , 2 1 2 63 , 4 3 6 , 4 2 2 3 , 1 0 0 , 7 9 7 8 , 5 0 0 6 6 , 5 2 8 , 7 1 9 Le s s A c c u m u l a t e d D e p r e c i a t i o n Bu i l d i n g s 2 , 3 7 8 , 1 7 8 2 9 1 , 4 7 1 - 2 , 6 6 9 , 6 4 9 Eq u i p m e n t 3 , 2 9 4 , 2 9 4 4 2 1 , 6 3 5 8 , 5 0 0 3 , 7 0 7 , 4 2 9 Ve h i c l e s 2 , 2 1 3 , 7 1 1 9 8 , 9 0 8 - 2 , 3 1 2 , 6 1 9 In f r a s t r u c t u r e 1 1 , 9 6 2 , 9 3 5 1 , 0 5 3 , 1 7 8 - 1 3 , 0 1 6 , 1 1 3 19 , 8 4 9 , 1 1 8 1 , 8 6 5 , 1 9 2 8 , 5 0 0 2 1 , 7 0 5 , 8 1 0 To t a l N e t D e p r e c i a b l e C a p i t a l A s s e t s 4 3 , 5 8 7 , 3 0 4 1 , 2 3 5 , 6 0 5 - 4 4 , 8 2 2 , 9 0 9 To t a l N e t C a p i t a l A s s e t s 7 3 , 8 1 1 , 5 9 6 2 , 1 3 3 , 2 6 0 1 0 1 , 5 1 7 7 5 , 8 4 3 , 3 3 9 Be g i n n i n g Ba l a n c e s De p r e c i a t i o n e x p e n s e w a s c h a r g e d t o g o v e r n m e n t a l a c t i v i t i e s a s f o l l o w s : Ge n e r a l G o v e r n m e n t $ 5 8 , 1 9 1 Li b r a r y 1 7 9 , 5 2 5 Pa r k s a n d R e c r e a t i o n 4 0 2 , 2 2 9 Pu b l i c S a f e t y 6 7 , 2 5 0 Pu b l i c W o r k s 1 , 1 5 7 , 9 9 7 1, 8 6 5 , 1 9 2 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d CA P I T A L A S S E T S – Co n t i n u e d Bu s i n e s s - T y p e A c t i v i t i e s Bu s i n e s s - t y p e c a p i t a l a s s e t a c t i v i t y f o r t h e y e a r w a s a s f o l l o w s : Ending In c r e a s e s D e c r e a s e s B a l a n c e s No n d e p r e c i a b l e C a p i t a l A s s e t s La n d $ 6 1 5 , 3 7 6 - - 6 1 5 , 3 7 6 Co n s t r u c t i o n i n P r o g r e s s 8 7 7 , 7 0 3 1 1 4 , 2 5 6 5 0 , 1 0 8 9 4 1 , 8 5 1 1, 4 9 3 , 0 7 9 1 1 4 , 2 5 6 5 0 , 1 0 8 1 , 5 5 7 , 2 2 7 De p r e c i a b l e C a p i t a l A s s e t s Eq u i p m e n t 1 8 , 8 9 1 , 2 9 9 - - 1 8 , 8 9 1 , 2 9 9 In f r a s t r u c t u r e 4 4 , 7 1 2 , 1 2 5 4 , 8 2 9 , 4 9 2 - 4 9 , 5 4 1 , 6 1 7 63 , 6 0 3 , 4 2 4 4 , 8 2 9 , 4 9 2 - 6 8 , 4 3 2 , 9 1 6 Le s s A c c u m u l a t e d D e p r e c i a t i o n Eq u i p m e n t 4 , 7 8 7 , 8 6 3 4 3 2 , 1 0 3 - 5 , 2 1 9 , 9 6 6 In f r a s t r u c t u r e 4 , 7 5 7 , 3 3 6 8 6 2 , 7 4 4 - 5 , 6 2 0 , 0 8 0 9, 5 4 5 , 1 9 9 1 , 2 9 4 , 8 4 7 - 1 0 , 8 4 0 , 0 4 6 To t a l N e t D e p r e c i a b l e C a p i t a l A s s e t s 5 4 , 0 5 8 , 2 2 5 3 , 5 3 4 , 6 4 5 - 5 7 , 5 9 2 , 8 7 0 To t a l N e t C a p i t a l A s s e t s 5 5 , 5 5 1 , 3 0 4 3 , 6 4 8 , 9 0 1 5 0 , 1 0 8 5 9 , 1 5 0 , 0 9 7 Be g i n n i n g Ba l a n c e s De p r e c i a t i o n e x p e n s e w a s c h a r g e d t o b u s i n e s s - t y p e a c t i v i t i e s a s f o l l o w s : Se w e r $ 4 8 9 , 8 3 7 Wa t e r 8 0 5 , 0 1 0 1,294,847 112 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d IN T E R F U N D R E C E I V A B L E S , P A Y A B L E S A N D T R A N S F E R S In t e r f u n d B a l a n c e s Th e c o m p o s i t i o n o f i n t e r f u n d b a l a n c e s a s o f t h e d a t e o f t h i s r e p o r t , i s a s f o l l o w s : Re c e i v a b l e F u n d Pa y a b l e F u n d Am o u n t Pa r k s a n d R e c r e a t i o n Ge n e r a l $ 8 , 4 1 2 Pa r k s a n d R e c r e a t i o n N o n m a j o r B u s i n e s s - T y p e 3 0 8 , 8 6 8 No n m a j o r G o v e r n m e n t a l Ge n e r a l 9, 0 3 6 No n m a j o r G o v e r n m e n t a l N o n m a j o r G o v e r n m e n t a l 30 , 0 0 0 Se w e r No n m a j o r G o v e r n m e n t a l 5 6 8 , 3 1 5 92 4 , 6 3 1 Th e p u r p o s e s o f t h e s i g n i f i c a n t i n t e r f u n d r e c e i v a b l e s / p a y a b l e s a r e a s f o l l o w s : x $3 0 8 , 8 6 8 d u e f r o m t h e R e c r e a t i o n C e n t e r F u n d ( n o n m a j o r b u s i n e s s - t y p e f u n d ) t o t h e P a r k s a n d Re c r e a t i o n F u n d r e p r e s e n t i n g c a s h b o r r o w i n g s w h i c h o c c u r r e d d u r i n g t h e y e a r . x $3 0 , 0 0 0 d u e f r o m t h e M o t o r F u e l T a x F u n d ( n o n m a j o r g o v e r n m e n t a l f u n d ) t o t h e C i t y w i d e Ca p i t a l F u n d ( n o n m a j o r g o v e r n m e n t a l f u n d ) r e p r e s e n t i n g c a s h b o r r o w i n g s w h i c h o c c u r r e d du r i n g t h e y e a r . x $5 6 8 , 3 1 5 d u e f r o m M u n i c i p a l B u i l d i n g F u n d ( n o n m a j o r g o v e r n m e n t a l f u n d ) t o S e w e r F u n d re p r e s e n t i n g c a s h b o r r o w i n g s w h i c h o c c u r r e d d u r i n g t h e y e a r . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d IN T E R F U N D R E C E I V A B L E S , P A Y A B L E S A D T R A N S F E R S –Continued In t e r f u n d T r a n s f e r s In t e r f u n d t r a n s f e r s f o r t h e y e a r c o n s i s t e d o f t h e f o l l o w i n g : Tr a n s f e r s I n Tr a n s f e r s O u t Amount Li b r a r y Ge n e r a l 26,819 Pa r k s a n d R e c r e a t i o n Ge n e r a l 955,886 No n m a j o r G o v e r n m e n t a l Ge n e r a l $518,797 No n m a j o r G o v e r n m e n t a l N o n m a j o r G o v e r n m e n t a l 2,500 Wa t e r Se w e r 82,288 1,586,290 Tr a n s f e r s a r e u s e d t o ( 1 ) m o v e r e v e n u e s f r o m t h e f u n d t h a t s t a t u t e o r b u d g e t r e q u i r e s t o c o l l e c t t h e m t o th e f u n d t h a t s t a t u t e o r b u d g e t r e q u i r e s t o e x p e n d t h e m , ( 2 ) m o v e r e c e i p t s r e s t r i c t e d t o d e b t s e r v i c e f r o m th e f u n d s c o l l e c t i n g t h e r e c e i p t s t o t h e d e b t s e r v i c e f u n d a s d e b t s e r v i c e p a y m e n t s b e c o m e d u e , a n d ( 3 ) us e u n r e s t r i c t e d r e v e n u e s c o l l e c t e d i n t h e g e n e r a l f u n d t o f i n a n c e v a r i o u s p r o g r a m s a c c o u n t e d f o r i n ot h e r f u n d s i n a c c o r d a n c e w i t h b u d g e t a r y a u t h o r i z a t i o n s . LO N G - T E R M D E B T No t e s P a y a b l e Th e C i t y e n t e r s i n t o n o t e s p a y a b l e t o p r o v i d e f u n d s f o r a c q u i s i t i o n o f c a p i t a l a s s e t s . N o t e s p a y a b l e h a v e be e n i s s u e d f o r t h e g o v e r n m e n t a l a c t i v i t i e s . N o t e s p a y a b l e a r e d i r e c t o b l i g a t i o n s a n d p l e d g e t h e f u l l fa i t h a n d c r e d i t o f t h e C i t y . N o t e s p a y a b l e c u r r e n t l y o u t s t a n d i n g a r e a s f o l l o w s : Fu n d D e b t Ending Is s u e Re t i r e d b y IssuancesRetirementsBalances Pu b l i c W o r k s Ca p i t a l $ 8 4 7 , 8 2 5 - 3 0 , 0 7 4 8 1 7 , 7 5 1 Be g i n n i n g Ba l a n c e s Be t z w i s e r D e v e l o p m e n t , L L C Ad j u s t a b l e R a t e N o t e P a y a b l e o f 20 0 8 , d u e i n m o n t h l y i n s t a l l m e n t s o f $6 8 5 8 p l u s i n t e r e s t a t 6 . 2 6 % t o 5 ye a r T - B i l l r a t e p l u s 3 % t h r o u g h Oc t o b e r 1 , 2 0 2 8 . 113 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d LO N G - T E R M D E B T – C o n t i n u e d No t e s P a y a b l e – Co n t i n u e d Fu n d D e b t En d i n g Is s u e Re t i r e d b y Is s u a n c e s R e t i r e m e n t s B a l a n c e s Ci t y w i d e Ca p i t a l $ - 3 7 , 8 5 0 - 3 7 , 8 5 0 84 7 , 8 2 5 3 7 , 8 5 0 3 0 , 0 7 4 8 5 5 , 6 0 1 Ke n d a l l C o u n t y R i v e r R o a d B r i d g e Lo a n P a y a b l e o f 2 0 1 3 , p a y a b l e i n an n u a l i n s t a l l m e n t s e q u a l t o o n e - si x t h o f t h e a m o u n t b o r r o w e d th r o u g h O c t o b e r 3 1 , 2 0 1 8 . Be g i n n i n g Ba l a n c e s Il l i n o i s E n v i r o n m e n t a l P r o t e c t i o n A g e n c y ( I E P A ) L o a n s P a y a b l e Th e C i t y h a s e n t e r e d i n t o l o a n a g r e e m e n t s w i t h t h e I E P A t o p r o v i d e l o w i n t e r e s t f i n a n c i n g f o r s e w e r an d w a t e r i m p r o v e m e n t s . I E P A l o a n s c u r r e n t l y o u t s t a n d i n g a r e a s f o l l o w s : Fu n d D e b t En d i n g Is s u e Re t i r e d b y Is s u a n c e s R e t i r e m e n t s B a l a n c e s Se w e r $ 3 7 , 9 5 8 - 37 , 9 5 8 - Se w e r 7 2 4 , 4 9 4 - 8 8 , 6 1 0 6 3 5 , 8 8 4 Wa t e r 1 , 5 1 2 , 8 6 6 - 8 7 , 7 5 3 1 , 4 2 5 , 1 1 3 2, 2 7 5 , 3 1 8 - 2 1 4 , 3 2 1 2 , 0 6 0 , 9 9 7 IE P A ( L 1 7 - 1 1 5 6 3 0 0 ) L o a n P a y a b l e of 2 0 0 7 , d u e i n s e i m - a n n u a l in s t a l l m e n t s o f $ 2 8 , 2 6 3 t o $ 6 1 , 7 4 4 in c l u d i n g i n t e r e s t a t 2 . 5 0 % t h r o u g h Au g u s t 9 , 2 0 2 6 . IE P A ( L 1 7 - 0 1 3 0 0 0 ) L o a n P a y a b l e o f 19 9 3 , d u e i n s e m i - a n n u a l in s t a l l m e n t s o f $ 7 , 4 7 8 t o $ 1 9 , 1 4 7 in c l u d i n g i n t e r e s t a t 3 . 5 8 % t h r o u g h Ja n u a r y 2 5 , 2 0 1 3 . IE P A ( L 1 7 - 1 1 5 3 0 0 ) L o a n P a y a b l e o f 20 0 0 , d u e i n s e i m - a n n u a l in s t a l l m e n t s o f $ 3 7 , 1 6 6 t o $ 5 2 , 8 3 2 in c l u d i n g i n t e r e s t a t 2 . 6 2 5 % t h r o u g h Se p t e m b e r 6 , 2 0 1 9 . Be g i n n i n g Ba l a n c e s UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d LO N G - T E R M D E B T – C o n t i n u e d Ge n e r a l O b l i g a t i o n B o n d s Th e C i t y i s s u e s g e n e r a l o b l i g a t i o n b o n d s t o p r o v i d e f u n d s f o r t h e a c q u i s i t i o n a n d c o n s t r u c t i o n o f m a j o r ca p i t a l f a c i l i t i e s . G e n e r a l o b l i g a t i o n b o n d s h a v e b e e n i s s u e d f o r b o t h g o v e r n m e n t a l a n d b u s i n e s s - t y p e ac t i v i t i e s . G e n e r a l o b l i g a t i o n b o n d s i s s u e d f o r b u s i n e s s - t y p e a c t i v i t i e s a r e r e p o r t e d i n t h e p r o p r i e t a r y fu n d s a s t h e y a r e e x p e c t e d t o b e r e p a i d f r o m p r o p r i e t a r y r e v e n u e s . G e n e r a l o b l i g a t i o n b o n d s a r e d i r e c t ob l i g a t i o n s a n d p l e d g e t h e f u l l f a i t h a n d c r e d i t o f t h e C i t y . Ge n e r a l o b l i g a t i o n b o n d s c u r r e n t l y o u t s t a n d i n g a r e a s f o l l o w s : Fu n d D e b t Ending Is s u e Re t i r e d b y IssuancesRetirementsBalances Fo x In d u s t r i a l TI F $ 7 5 , 0 0 0 - 7 5 , 0 0 0 - Se w e r 2 , 5 2 0 , 0 0 0 - 1 7 0 , 0 0 0 2 , 3 5 0 , 0 0 0 Co u n t r y s i d e TI F 3 , 0 1 5 , 0 0 0 - 1 8 0 , 0 0 0 2 , 8 3 5 , 0 0 0 De b t Se r v i c e 2 , 9 1 0 , 0 0 0 - 2 0 5 , 0 0 0 2 , 7 0 5 , 0 0 0 Be g i n n i n g Ba l a n c e s Ge n e r a l O b l i g a t i o n A l t e r n a t e Re v e n u e S o u r c e B o n d s o f 2 0 0 2 , d u e in a n n u a l i n s t a l l m e n t s o f $ 5 0 , 0 0 0 t o $7 5 , 0 0 0 p l u s i n t e r e s t a t 3 . 0 0 % t o 4. 7 5 % t h r o u g h D e c e m b e r 1 , 2 0 1 2 . Ge n e r a l O b l i g a t i o n A l t e r n a t e Re v e n u e S o u r c e B o n d s o f 2 0 0 5 , d u e in a n n u a l i n s t a l l m e n t s o f $ 1 6 5 , 0 0 0 t o $3 0 0 , 0 0 0 p l u s i n t e r e s t a t 3 . 5 0 % t o 4. 3 5 % t h r o u g h D e c e m b e r 1 , 2 0 2 4 . Ge n e r a l O b l i g a t i o n A l t e r n a t e Re v e n u e S o u r c e B o n d s o f 2 0 0 4 B , du e i n a n n u a l i n s t a l l m e n t s o f $1 2 0 , 0 0 0 t o $ 4 5 5 , 0 0 0 p l u s i n t e r e s t a t 2. 5 0 % t o 4 . 0 0 % t h r o u g h D e c e m b e r 30 , 2 0 1 8 . Ge n e r a l O b l i g a t i o n A l t e r n a t e Re v e n u e S o u r c e B o n d s o f 2 0 0 5 A , du e i n a n n u a l i n s t a l l m e n t s o f $3 0 , 0 0 0 t o $ 3 3 5 , 0 0 0 p l u s i n t e r e s t a t 4. 0 0 % t o 4 . 3 7 5 % t h r o u g h D e c e m b e r 30 , 2 0 2 2 . 114 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d LO N G - T E R M D E B T – C o n t i n u e d Ge n e r a l O b l i g a t i o n B o n d s – C o n t i n u e d Fu n d D e b t En d i n g Is s u e Re t i r e d b y Is s u a n c e s R e t i r e m e n t s B a l a n c e s Li b r a r y 6 , 9 5 0 , 0 0 0 - 2 9 0 , 0 0 0 6 , 6 6 0 , 0 0 0 Wa t e r $ 1 , 5 5 5 , 0 0 0 - 9 0 , 0 0 0 1 , 4 6 5 , 0 0 0 Li b r a r y 9 7 5 , 0 0 0 - 1 5 0 , 0 0 0 8 2 5 , 0 0 0 Wa t e r 2 , 9 5 0 , 0 0 0 - 1 0 , 0 0 0 2 , 9 4 0 , 0 0 0 Se w e r 1 1 , 1 5 0 , 0 0 0 - - 1 1 , 1 5 0 , 0 0 0 32 , 1 0 0 , 0 0 0 - 1 , 1 7 0 , 0 0 0 3 0 , 9 3 0 , 0 0 0 Be g i n n i n g Ba l a n c e s Ge n e r a l O b l i g a t i o n R e f u n d i n g Al t e r n a t e R e v e n u e S o u r c e B o n d s o f 20 1 1 , d u e i n a n n u a l i n s t a l l m e n t s o f $6 6 0 , 0 0 0 t o $ 1 , 1 0 0 , 0 0 0 p l u s i n t e r e s t at 4 . 2 8 0 % t h r o u g h D e c e m b e r 3 0 , 20 2 5 . Ge n e r a l O b l i g a t i o n L i b r a r y B o n d s o f 20 0 6 , d u e i n a n n u a l i n s t a l l m e n t s o f $5 0 , 0 0 0 t o $ 1 0 0 , 0 0 0 p l u s i n t e r e s t a t 4. 7 5 % t o 4 . 8 0 % t h r o u g h D e c e m b e r 30 , 2 0 2 4 . Ge n e r a l O b l i g a t i o n R e f u n d i n g Al t e r n a t e R e v e n u e S o u r c e B o n d s o f 20 0 7 A , d u e i n a n n u a l i n s t a l l m e n t s o f $1 0 , 0 0 0 t o $ 7 5 0 , 0 0 0 p l u s i n t e r e s t a t 4. 0 0 % t o 4 . 2 5 % t h r o u g h D e c e m b e r 30 , 2 0 2 2 . Ge n e r a l O b l i g a t i o n A l t e r n a t e Re v e n u e S o u r c e B o n d s o f 2 0 0 5 C , du e i n a n n u a l i n s t a l l m e n t s o f $3 5 , 0 0 0 t o $ 1 5 0 , 0 0 0 p l u s i n t e r e s t a t 3. 5 0 % t o 5 . 5 0 % t h r o u g h D e c e m b e r 30 , 2 0 2 4 . Ge n e r a l O b l i g a t i o n L i b r a r y B o n d s o f 20 0 5 B , d u e i n a n n u a l i n s t a l l m e n t s o f $2 5 , 0 0 0 t o $ 7 6 0 , 0 0 0 p l u s i n t e r e s t a t 4. 0 0 % t o 4 . 7 5 % t h r o u g h D e c e m b e r 30 , 2 0 2 4 . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d LO N G - T E R M D E B T – C o n t i n u e d De b t Ce r t i f i c a t e s Th e C i t y i s s u e s d e b t c e r t i f i c a t e s t o p r o v i d e f u n d s f o r t h e a c q u i s i t i o n a n d c o n s t r u c t i o n o f m a j o r c a p i t a l fa c i l i t i e s . D e b t c e r t i f i c a t e s h a v e b e e n i s s u e d f o r b o t h g o v e r n m e n t al and business-type activities. Debt Ce r t i f i c a t e s i s s u e d f o r b u s i n e s s - t y p e a c t i v i t i e s a r e r e p o r t e d i n t h e p r o p r i e t a r y f u n d s a s t h e y a r e e x p e c t e d to b e r e p a i d f r o m p r o p r i e t a r y r e v e n u e s . D e b t c e r t i f i c a t e s c u r r e n t l y o u t s t a n d i n g a r e a s f o l l o w s : Fu n d D e b t Ending Is s u e Re t i r e d b y IssuancesRetirementsBalances Wa t e r $ 3 6 5 , 0 0 0 - 3 6 5 , 0 0 0 - Se w e r 1 , 3 6 0 , 0 0 0 - 1 0 0 , 0 0 0 1 , 2 6 0 , 0 0 0 Wa t e r 8 0 0 , 0 0 0 - -800,000 Se w e r 5 4 5 , 0 0 0 - 1 7 5 , 0 0 0 3 7 0 , 0 0 0 De b t Se r v i c e 95 , 0 0 0 - 9 5 , 0 0 0 - Wa t e r 5 , 3 9 0 , 0 0 0 - 3 5 5 , 0 0 0 5 , 0 3 5 , 0 0 0 8, 5 5 5 , 0 0 0 - 1 , 0 9 0 , 0 0 0 7 , 4 6 5 , 0 0 0 Be g i n n i n g Ba l a n c e s Re f u n d i n g D e b t C e r t i f i c a t e s o f 20 0 6 A , d u e i n a n n u a l i n s t a l l m e n t s o f $5 , 0 0 0 t o $ 8 5 0 , 0 0 0 p l u s i n t e r e s t a t 4. 0 0 % t o 4 . 2 0 % t h r o u g h D e c e m b e r 30 , 2 0 2 2 . Ca p i t a l A p p r e c i a t i o n D e b t Ce r t i f i c a t e s o f 2 0 0 2 , d u e i n a n n u a l in s t a l l m e n t s o f $ 3 5 , 0 0 0 t o $ 3 6 5 , 0 0 0 pl u s i n t e r e s t a t 2 . 5 0 % t o 4 . 5 0 % th r o u g h M a y 1 , 2 0 1 2 . Il l i n o i s R u r a l B o n d B a n k D e b t Ce r t i f i c a t e s o f 2 0 0 3 , d u e i n a n n u a l in s t a l l m e n t s o f $ 8 0 , 0 0 0 t o $ 1 5 5 , 0 0 0 pl u s i n t e r e s t a t 1 . 6 0 % t o 5 . 2 0 % th r o u g h F e b r u a r y 1 , 2 0 2 3 . De b t C e r t i f i c a t e s o f 2 0 0 3 , d u e i n an n u a l i n s t a l l m e n t s o f $ 1 0 0 , 0 0 0 t o $3 0 0 , 0 0 0 p l u s i n t e r e s t a t 3 . 8 0 % t o 5. 0 0 % t h r o u g h D e c e m b e r 1 5 , 2 0 1 8 . De b t C e r t i f i c a t e s o f 2 0 0 4 C , d u e i n an n u a l i n s t a l l m e n t s o f $ 5 0 , 0 0 0 t o $9 5 , 0 0 0 p l u s i n t e r e s t a t 5 . 0 0 % th r o u g h D e c e m b e r 3 0 , 2 0 1 2 . De b t C e r t i f i c a t e s o f 2 0 0 4 A , d u e i n an n u a l i n s t a l l m e n t s o f $ 1 3 5 , 0 0 0 t o $1 9 0 , 0 0 0 p l u s i n t e r e s t a t 1 . 4 0 % t o 3. 6 0 % t h r o u g h D e c e m b e r 3 0 , 2 0 1 4 . 115 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d LO N G - T E R M D E B T – C o n t i n u e d Ot h e r O b l i g a t i o n s Ot h e r O b l i g a t i o n s c u r r e n t l y o u t s t a n d i n g a r e a s f o l l o w s : Fu n d D e b t En d i n g Is s u e Re t i r e d b y Is s u a n c e s R e t i r e m e n t s B a l a n c e s Go v e r n m e n t a l Ac t i v i t i e s $ 1 , 8 9 0 - - 1 , 8 9 0 Be g i n n i n g Ba l a n c e s Co n o v e r S e w e r R e c a p t u r e o w e d t o Jo h n C o n o v e r a s r e i m b u r s e m e n t f o r se w e r e x t e n s i o n , d u e i n o n e l u m p su m p a y m e n t o f $ 1 , 8 9 0 i n f i s c a l y e a r 20 2 3 . Lo n g - T e r m L i a b i l i t y A c t i v i t y Ch a n g e s i n l o n g - t e r m l i a b i l i t i e s d u r i n g t h e f i s c a l y e a r w e r e a s f o l l o w s : Am o u n t s En d i n g D u e w i t h i n Ad d i t i o n s D e d u c t i o n s B a l a n c e s O n e Y e a r Go v e r n m e n t a l A c t i v i t i e s Co m p e n s a t e d A b s e n c e s $ 3 6 5 , 1 2 5 5 9 , 5 7 5 1 1 9 , 1 4 9 3 0 5 , 5 5 0 6 1 , 1 1 0 Ne t P e n s i o n O b l i g a t i o n 5 6 4 , 3 1 1 8 9 , 1 1 2 - 6 5 3 , 4 2 3 - Ne t O t h e r P o s t - E m p l o y m e n t Be n e f i t O b l i g a t i o n 9 , 4 5 3 - 1 , 5 2 6 7 , 9 2 7 - No t e s P a y a b l e 8 4 7 , 8 2 5 3 7 , 8 5 0 3 0 , 0 7 4 8 5 5 , 6 0 1 3 2 , 0 1 2 Ge n e r a l O b l i g a t i o n B o n d s 1 3 , 9 2 5 , 0 0 0 - 9 0 0 , 0 0 0 1 3 , 0 2 5 , 0 0 0 8 3 5 , 0 0 0 De b t C e r t i f i c a t e s 9 5 , 0 0 0 - 9 5 , 0 0 0 - - Ot h e r O b l i g a t i o n s 1 , 8 9 0 - - 1 , 8 9 0 - 15 , 8 0 8 , 6 0 4 1 8 6 , 5 3 7 1 , 1 4 5 , 7 4 9 1 4 , 8 4 9 , 3 9 1 9 2 8 , 1 2 2 Be g i n n i n g Ty p e o f D e b t B a l a n c e s UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – C o n t i n u e d LO N G - T E R M D E B T – Co n t i n u e d Lo n g - T e r m L i a b i l i t y A c t i v i t y – Co n t i n u e d Amounts EndingDue within Ad d i t i o n s D e d u c t i o n s B a l a n c e s O n e Y e a r Bu s i n e s s - T y p e A c t i v i t i e s Co m p e n s a t e d A b s e n c e s $ 9 4 , 0 8 1 5 0 , 1 2 4 1 0 0 , 2 4 7 4 3 , 9 5 7 8 , 7 9 1 IE P A L o a n s P a y a b l e 2 , 2 7 5 , 3 1 8 - 2 1 4 , 3 2 1 2 , 0 6 0 , 9 9 7 1 8 0 , 9 1 3 Ge n e r a l O b l i g a t i o n B o n d s 1 8 , 1 7 5 , 0 0 0 - 2 7 0 , 0 0 0 1 7 , 9 0 5 , 0 0 0 1 , 0 5 0 , 0 0 0 Pl u s : U n a m o r t i z e d I t e m Lo s s o n R e f u n d i n g 4 7 2 , 8 2 3 - 7 7 , 5 9 8 3 9 5 , 2 2 5 - De b t C e r t i f i c a t e s 8 , 4 6 0 , 0 0 0 - 9 9 5 , 0 0 0 7 , 4 6 5 , 0 0 0 7 8 5 , 0 0 0 De v e l o p e r A g r e e m e n t s 2 , 0 6 5 , 9 5 8 - 1 1 3 , 4 2 4 1 , 9 5 2 , 5 3 4 - 31 , 5 4 3 , 1 8 0 5 0 , 1 2 4 1 , 7 7 0 , 5 9 0 2 9 , 8 2 2 , 7 1 3 2 , 0 2 4 , 7 0 4 Be g i n n i n g Ty p e o f D e b t B a l a n c e s Fo r t h e g o v e r n m e n t a l a c t i v i t i e s , t h e c o m p e n s a t e d a b s e n c e s , t h e n e t p e n s i o n o b l i g a t i o n , a n d t h e n e t o t h e r po s t - e m p l o y m e n t b e n e f i t o b l i g a t i o n a r e g e n e r a l l y l i q u i d a t e d b y t h e G e n e r a l F u n d . T h e P u b l i c W o r k s Ca p i t a l F u n d m a k e s p a y m e n t o n t h e n o t e s p a y a b l e . G e n e r a l o b l i g a t i o n b o n d s a r e b e i n g l i q u i d a t e d b y t h e Li b r a r y , C o u n t r y s i d e T I F a n d D e b t S e r v i c e F u n d s . A d d i t i o n a l l y , t h e D e b t S e r v i c e F u n d i s m a k i n g pa y m e n t o n t h e d e b t c e r t i f i c a t e . Fo r t h e b u s i n e s s - t y p e a c t i v i t i e s , t h e S e w e r , W a t e r , a n d R e c r e a t i o n C e n t e r F u n d s l i q u i d a t e c o m p e n s a t e d ab s e n c e s . T h e S e w e r a n d W a t e r F u n d s a r e m a k i n g p a y m e n t s o n t h e I E P A l o a n s p a y a b l e , g e n e r a l ob l i g a t i o n b o n d s , d e b t c e r t i f i c a t e s a n d d e v e l o p e r a g r e e m e n t s . 116 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d LO N G - T E R M D E B T – Co n t i n u e d De b t S e r v i c e R e q u i r e m e n t s t o M a t u r i t y Th e a n n u a l d e b t s e r v i c e r e q u i r e m e n t s t o m a t u r i t y , i n c l u d i n g p r i n c i p a l a n d i n t e r e s t , a r e a s f o l l o w s : In t e r e s t In t e r e s t $ 3 2 , 0 1 2 5 0 , 2 8 3 8 3 5 , 0 0 0 5 6 7 , 6 8 2 34 , 0 7 4 4 8 , 2 2 1 8 7 0 , 0 0 0 5 3 3 , 7 1 4 36 , 2 7 0 4 6 , 0 2 5 9 2 0 , 0 0 0 4 9 8 , 5 3 8 38 , 6 0 7 4 3 , 6 8 9 9 7 0 , 0 0 0 4 6 1 , 3 6 4 41 , 0 9 4 4 1 , 2 0 1 1 , 0 1 5 , 0 0 0 4 2 2 , 1 8 8 43 , 7 4 1 3 8 , 5 5 4 1 , 0 9 0 , 0 0 0 3 8 0 , 9 5 4 46 , 5 6 0 3 5 , 7 3 5 1 , 1 5 0 , 0 0 0 3 3 2 , 7 4 0 49 , 5 5 9 3 2 , 7 3 6 1 , 2 2 5 , 0 0 0 2 8 1 , 5 7 8 52 , 7 5 2 2 9 , 5 4 3 1 , 3 0 5 , 0 0 0 2 2 6 , 6 2 0 56 , 1 5 1 2 6 , 1 4 4 1 , 3 7 5 , 0 0 0 1 6 8 , 0 7 2 59 , 7 6 9 2 2 , 5 2 6 1 , 1 1 0 , 0 0 0 1 0 5 , 3 9 4 63 , 6 1 9 1 8 , 6 7 6 1 , 1 6 0 , 0 0 0 5 3 , 9 5 0 67 , 7 1 8 1 4 , 5 7 7 - - 72 , 0 8 1 1 0 , 2 1 4 - - 76 , 7 2 5 5 , 5 7 0 - - 47 , 0 1 9 9 8 6 - - To t a l 8 1 7 , 7 5 1 4 6 4 , 6 8 0 1 3 , 0 2 5 , 0 0 0 4 , 0 3 2 , 7 9 4 20 2 8 20 2 9 20 2 7 Fi s c a l 20 1 7 20 1 8 20 1 9 20 2 0 20 2 1 20 2 2 20 2 3 20 2 4 20 2 5 20 2 6 20 1 6 Ge n e r a l O b l i g a t i o n Bo n d s Pr i n c i p a l No t e s Pa y a b l e Pr i n c i p a l Go v e r n m e n t a l A c t i v i t i e s 20 1 4 20 1 5 Ye a r UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d LO N G - T E R M D E B T – Co n t i n u e d De b t S e r v i c e R e q u i r e m e n t s t o M a t u r i t y – Co n t i n u e d In t e r e s t InterestInterest $ 1 8 0 , 9 1 3 5 1 , 1 6 8 1 , 0 5 0 , 0 0 0 7 5 9 , 9 8 8 7 8 5 , 0 0 0 3 1 3 , 8 5 4 18 5 , 5 8 0 4 6 , 5 0 1 1 , 1 7 5 , 0 0 0 7 1 7 , 5 2 0 8 1 5 , 0 0 0 2 8 3 , 2 4 4 19 0 , 3 6 5 4 1 , 7 1 4 1 , 2 3 0 , 0 0 0 6 7 0 , 4 4 8 6 4 5 , 0 0 0 2 5 0 , 9 2 6 19 5 , 2 7 5 3 6 , 8 0 5 1 , 2 8 0 , 0 0 0 6 2 1 , 1 9 0 6 7 5 , 0 0 0 2 2 4 , 4 1 2 20 0 , 3 1 3 3 1 , 7 6 7 1 , 3 4 0 , 0 0 0 5 6 7 , 8 6 8 6 9 5 , 0 0 0 1 9 6 , 3 9 8 20 5 , 4 8 0 2 6 , 6 0 1 1 , 4 0 0 , 0 0 0 5 1 2 , 0 4 6 9 2 5 , 0 0 0 1 6 7 , 0 8 8 15 7 , 2 5 5 2 1 , 3 0 0 1 , 6 4 5 , 0 0 0 4 5 3 , 7 4 0 9 8 5 , 0 0 0 1 2 7 , 6 7 4 10 7 , 0 4 9 1 7 , 9 8 1 1 , 7 1 0 , 0 0 0 3 8 2 , 0 7 4 9 9 0 , 0 0 0 8 5 , 1 5 6 10 9 , 7 4 2 1 5 , 2 8 8 1 , 7 8 0 , 0 0 0 3 0 7 , 5 0 8 5 4 0 , 0 0 0 4 2 , 3 1 6 11 2 , 5 0 3 1 2 , 5 2 7 1 , 8 5 0 , 0 0 0 2 2 9 , 8 9 4 4 1 0 , 0 0 0 1 8 , 5 8 0 11 5 , 3 3 4 9 , 6 9 7 1 , 1 5 0 , 0 0 0 1 5 1 , 1 0 6 - - 11 8 , 2 3 5 6 , 7 9 5 1 , 1 9 5 , 0 0 0 1 0 0 , 0 5 6 - - 12 1 , 2 0 9 3 , 8 2 1 1 , 1 0 0 , 0 0 0 4 7 , 0 8 0 - - 61 , 7 4 4 7 7 2 - - -- To t a l 2 , 0 6 0 , 9 9 7 3 2 2 , 7 3 7 1 7 , 9 0 5 , 0 0 0 5 , 5 2 0 , 5 1 8 7 , 4 6 5 , 0 0 0 1 , 7 0 9 , 6 4 8 Bu s i n e s s - T y p e A c t i v i t i e s IE P A Ge n e r a l O b l i g a t i o n Debt Lo a n P a y a b l e Bo n d s Certificates Ye a r P r i n c i p a l Pr i n c i p a l Principal 20 1 4 20 1 5 20 1 6 20 1 7 Fi s c a l 20 1 8 20 1 9 20 2 0 20 2 1 20 2 2 20 2 3 20 2 4 20 2 5 20 2 6 20 2 7 No n - C o m m i t m e n t D e b t Sp e c i a l s e r v i c e a r e a b o n d s o u t s t a n d i n g a s o f t h e d a t e o f t h i s r e p o r t t o t a l e d $ 7 7 , 9 4 3 , 0 0 0 , K e n d a l l Ma r k e t p l a c e b u s i n e s s d i s t r i c t b o n d s t o t a l e d $ 6 , 9 4 0 , 0 0 0 a n d K e n d a l l M a r k e t p l a c e s a l e s t a x b o n d s t o t a l e d $6 , 5 8 0 , 0 0 0 . T h e s e b o n d s a r e n o t a n o b l i g a t i o n o f t h e g o v e r n m e n t a n d a r e s e c u r e d b y t h e l e v y o f a n an n u a l t a x o n t h e r e a l p r o p e r t y w i t h i n t h e s p e c i a l s e r v i c e a r e a , b u s i n e s s d i s t r i c t t a x e s , a n d s a l e s t a x e s , re s p e c t i v e l y . T h e g o v e r n m e n t i s i n n o w a y l i a b l e f o r r e p a y m e n t b u t i s o n l y a c t i n g a s a g e n t f o r t h e pr o p e r t y o w n e r s i n l e v y i n g / a s s e s s i n g a n d c o l l e c t i ng t h e t a x , a n d f o r w a r d i n g t h e c o l l e c t i o n s t o bo n d h o l d e r s . 117 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d LO N G - T E R M D E B T – Co n t i n u e d Le g a l D e b t M a r g i n Ch a p t e r 6 5 , S e c t i o n 5 / 8 - 5 - 1 o f t h e I l l i n o i s C o m p i l e d S t a t u t e s p r o v i d e s , “ … n o m u n i c i p a l i t y h a v i n g a po p u l a t i o n o f l e s s t h a n 5 0 0 , 0 0 0 s h a l l b e c o m e i n d e b t e d i n a n y m a n n e r o r f o r a n y p u r p o s e , t o a n a m o u n t , in c l u d i n g e x i s t i n g i n d e b t e d n e s s i n t h e a g g r e g a t e e x c e e d i n g 8 . 6 2 5 % o n t h e v a l u e o f t h e t a x a b l e p r o p e r t y th e r e i n , t o b e a s c e r t a i n e d b y t h e l a s t a s s e s s m e n t f o r s t a t e a n d c o u n t y p u r p o s e s , p r e v i o u s t o t h e i n c u r r i n g of t h e i n d e b t e d n e s s o r , u n t i l J a n u a r y 1 , 1 9 8 3 , i f g r e a t e r , t h e s u m t h a t i s p r o d u c e d b y m u l t i p l y i n g t h e mu n i c i p a l i t y ’ s 1 9 7 8 e q u a l i z e d a s s e s s e d v a l u a t i o n b y t h e d e b t l i m i t a t i o n p e r c e n t a g e i n e f f e c t o n J a n u a r y 1, 1 9 7 9 . ” As s e s s e d V a l u a t i o n - 2 0 1 2 $ 4 4 3 , 1 2 2 , 8 0 8 Le g a l D e b t L i m i t - 8 . 6 2 5 % o f A s s e s s e d V a l u e 38 , 2 1 9 , 3 4 2 Am o u n t o f D e b t A p p l i c a b l e t o L i m i t Ge n e r a l O b l i g a t i o n B o n d s 22 , 9 4 5 , 0 0 0 Le g a l D e b t M a r g i n 15 , 2 7 4 , 3 4 2 Bo n d D e f e a s a n c e s Du r i n g p r i o r y e a r s , t h e C i t y d e f e a s e d g e n e r a l o b l i g a t i o n a n d r e v e n u e b o n d s b y p l a c i n g t h e p r o c e e d s o f ne w b o n d s i n a n i r r e v o c a b l e t r u s t t o p r o v i d e f o r a l l f u t u r e d e b t s e r v i c e p a y m e n t s o n t h e o l d b o n d s . S i n c e th e r e q u i r e m e n t s w h i c h n o r m a l l y s a t i s f y d e f e a s a n c e h a v e b e e n m e t , t h e f i n a n c i a l s t a t e m e n t s r e f l e c t sa t i s f a c t i o n o f t h e o r i g i n a l l i a b i l i t y t h r o u g h t h e i r r e v o c a b l e t r a n s f e r t o a n e s c r o w a g e n t o f a n a m o u n t co m p u t e d t o b e a d e q u a t e t o m e e t t h e f u t u r e d e b t s e r v i c e r e q u i r e m e n t s o f t h e i s s u e . A c c o r d i n g l y , t h e tr u s t a c c o u n t a s s e t s a n d t h e l i a b i l i t y f o r t h e d e f e a s e d b o n d s a r e n o t i n c l u d e d i n t h e C i t y ’ s g e n e r a l pu r p o s e f i n a n c i a l s t a t e m e n t s . D e f e a s e d b o n d s i n t h e a m o u n t o f $ 1 4 , 5 1 3 , 1 1 6 a r e s t i l l o u t s t a n d i n g a s o f th e d a t e o f t h i s r e p o r t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d NE T P O S I T I O N C L A S S I F I C A T I O N S Ne t i n v e s t m e n t i n c a p i t a l a s s e t s w a s c o m p r i s e d o f t h e f o l l o w i n g a s o f A p r i l 3 0 , 2 0 1 3 : Go v e r n m e n t a l A c t i v i t i e s Ca p i t a l A s s e t s - N e t o f A c c u m u l a t e d D e p r e c i a t i o n $ 7 5 , 8 4 3 , 3 3 9 Le s s C a p i t a l R e l a t e d D e b t : No t e s P a y a b l e o f 2 0 0 8 ( 8 1 7 , 7 5 1 ) Lo a n P a y a b l e o f 2 0 1 3 ( 3 7 , 8 5 0 ) Ge n e r a l O b l i g a t i o n A l t e r n a t e R e v e n u e S o u r c e B o n d s o f 2 0 0 5 ( 2 , 8 3 5 , 0 0 0 ) Ge n e r a l O b l i g a t i o n A l t e r n a t e R e v e n u e S o u r c e B o n d s o f 2 0 0 5 A ( 2 , 7 0 5 , 0 0 0 ) Ge n e r a l O b l i g a t i o n L i b r a r y A l t e r n a t e R e v e n u e S o u r c e B o n d s o f 2 0 0 5 B ( 6 , 6 6 0 , 0 0 0 ) Ge n e r a l O b l i g a t i o n L i b r a r y B o n d s o f 2 0 0 6 ( 8 2 5 , 0 0 0 ) Ne t I n v e s t m e n t i n C a p i t a l A s s e t s 6 1 , 9 6 2 , 7 3 8 Bu s i n e s s - T y p e A c t i v i t i e s Ca p i t a l A s s e t s - N e t o f A c c u m u l a t e d D e p r e c i a t i o n 5 9 , 1 5 0 , 0 9 7 Le s s C a p i t a l R e l a t e d D e b t : IE P A ( L 1 7 - 1 1 5 3 0 0 ) L o a n P a y a b l e o f 2 0 0 0 ( 6 3 5 , 8 8 4 ) IE P A ( L 1 7 - 1 1 5 6 3 0 0 ) L o a n P a y a b l e o f 2 0 0 7 ( 1 , 4 2 5 , 1 1 3 ) Ge n e r a l O b l i g a t i o n A l t e r n a t e R e v e n u e S o u r c e B o n d s o f 2 0 0 4 B ( 2 , 3 5 0 , 0 0 0 ) Ge n e r a l O b l i g a t i o n A l t e r n a t e R e v e n u e S o u r c e B o n d s o f 2 0 0 5 C ( 1 , 4 6 5 , 0 0 0 ) Ge n e r a l O b l i g a t i o n R e f u n d i n g A R S B o n d s o f 2 0 0 7 A ( 2 , 9 4 0 , 0 0 0 ) Ge n e r a l O b l i g a t i o n R e f u n d i n g A R S B o n d s o f 2 0 1 1 ( 1 1 , 1 5 0 , 0 0 0 ) Il l i n o i s R u r a l B o n d B a n k D e b t C e r t i f i c a t e s o f 2 0 0 3 ( 1 , 2 6 0 , 0 0 0 ) De b t C e r t i f i c a t e s o f 2 0 0 3 ( 8 0 0 , 0 0 0 ) De b t C e r t i f i c a t e s o f 2 0 0 4 A ( 3 7 0 , 0 0 0 ) Re f u n d i n g D e b t C e r t i f i c a t e s o f 2 0 0 6 A ( 5 , 0 3 5 , 0 0 0 ) Ne t I n v e s t m e n t i n C a p i t a l A s s e t s 3 1 , 7 1 9 , 1 0 0 118 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – Co n t i n u e d NE T P O S I T I O N R E S T A T E M E N T S Be g i n n i n g n e t p o s i t i o n i n t h e S e w e r a n d W a t e r F u n d s w a s r e s t a t e d d u e t o e l i m i n a t i o n o f b o n d i s s u a n c e co s t s t h r o u g h i m p l e m e n t a t i o n o f G A S B 6 3 / 6 5 . T h e f o l l o w i n g i s a s u m m a r y o f t h e n e t p o s i t i o n a s or i g i n a l l y r e p o r t e d a n d a s r e s t a t e d : In c r e a s e Ne t P o s i t i o n As R e s t a t e d ( D e c r e a s e ) Se w e r $ 2 0 , 0 6 6 , 6 8 0 1 9 , 7 4 1 , 1 3 0 ( 3 2 5 , 5 5 0 ) Wa t e r 2 0 , 8 8 4 , 3 3 8 2 0 , 7 8 7 , 8 4 5 ( 9 6 , 4 9 3 ) As R e p o r t e d FU N D B A L A N C E C L A S S I F I C A T I O N S In t h e g o v e r n m e n t a l f u n d s f i n a n c i a l s t a t e m e n t s , t h e C i t y c o n s i d e r s r e s t r i c t e d a m o u n t s t o h a v e b e e n sp e n t w h e n a n e x p e n d i t u r e i s i n c u r r e d f o r p u r p o s e s f o r w h i c h b o t h r e s t r i c t e d a n d u n r e s t r i c t e d f u n d ba l a n c e i s a v a i l a b l e . T h e C i t y f i r s t u t i l i z e s c o m m i t t e d , t h e n a s s i g n e d a n d t h e n u n a s s i g n e d f u n d b a l a n c e wh e n a n e x p e n d i t u r e i s i n c u r r e d f o r p u r p o s e s f o r w h i c h a l l t h r e e u n r e s t r i c t e d f u n d b a l a n c e s a r e av a i l a b l e . As s i g n e d F u n d B a l a n c e . T h e C i t y r e p o r t s a s s i g n e d f u n d b a l a n c e i n t h e P o l i c e C a p i t a l ( n o n m a j o r ) , Pu b l i c W o r k s C a p i t a l ( n o n m a j o r ) , P a r k s a n d R e c r e a t i o n C a p i t a l ( n o n m a j o r ) a n d i n t h e C i t y w i d e C a p i t a l (n o n m a j o r ) F u n d s . T h e C i t y ’ s C o u n c i l / m a n a g e m e n t h a s a s s i g n e d t h e s e t h r e e f u n d s t o f u t u r e l i b r a r y , po l i c e , p u b l i c w o r k s a n d p a r k s a n d r e c r e a t i o n i m p r o v e m e n t p r o j e c t s a n d e q u i p m e n t a n d v e h i c l e pu r c h a s e s b a s e d o n a p p r o v e d C o u n c i l / m a n a g e m e n t e x p e n d i t u r e s a s d e t e r m i n e d t h r o u g h t h e a n n u a l bu d g e t p r o c e s s . Co m m i t t e d F u n d B a l a n c e . T h e C i t y r e p o r t s c o m m i t t e d f u n d b a l a n c e i n t h e P a r k s a n d R e c r e a t i o n Ca p i t a l F u n d , a m a j o r f u n d . F o r m a l C i t y C o u n c i l a c t i o n , t h r o u g h t h e p a s s a g e o f a n o r d i n a n c e , i s re q u i r e d t o e s t a b l i s h , m o d i f y o r r e s c i n d a f u n d b a l a n c e c o m m i t m e n t . T h e C i t y ’ s C o u n c i l , t h r o u g h fo r m a l b o a r d a c t i o n a s p a r t o f t h e a n n u a l b u d g e t p r o c e s s , h a s c o m m i t t e d t h e s e f u n d s t o f u t u r e r e c r e a t i o n pr o g r a m s , f a c i l i t i e s an d i m p r o v e m e n t s . Mi n i m u m F u n d B a l a n c e P o l i c y . T h e C i t y ’ s p o l i c y s t a t e s t h a t t h e G e n e r a l f u n d s h o u l d m a i n t a i n a mi n i m u m u n r e s t r i c t e d f u n d b a l a n c e o f no l e s s t h a n 1 5 % o f t h e a n n u a l a p p r o p r i a t i o n s b u d g e t . B a l a n c e s in e x c e s s o f 5 0 % o f t h e a p p r o p r i a t i o n s b u d g e t c a n b e t r a n s f e r r e d t o o t h e r f u n d s o r t o c a p i t a l p r o j e c t s a t th e d i s c r e t i o n o f t h e C o u n c i l . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 3 – D E T A I L N O T E S O N A L L F U N D S – C o n t i n u e d FU N D B A L A N C E C L A S S I F I C A T I O N S – C o n t i n u e d Th e f o l l o w i n g i s a s c h e d u l e o f f u n d b a l a n c e c l a s s i f i c a t i o n s f o r t h e g o v e r n m e n t a l f u n d s a s o f t h e d a t e o f th i s r e p o r t : Parks and Li b r a r y R e c r e a t i o n N o n m a j o r T o t a l s Fu n d B a l a n c e s No n s p e n d a b l e Pr e p a i d s $ 1 3 9 , 9 8 5 8 , 1 9 5 1 4 , 5 6 6 1 1 , 8 2 5 1 7 4 , 5 7 1 Re s t r i c t e d Li b r a r y O p e r a t i o n s - 4 5 3 , 6 3 0 - - 4 5 3 , 6 3 0 Sp e c i a l S e r v i c e A r e a s - --22,86422,864 Mo t o r F u e l T a x - --1,152,3481,152,348 La n d C a s h - --121,420121,420 Ta x I n c r e m e n t F i n a n c i n g D i s t r i c t s - --1,787,6051,787,605 De b t S e r v i c e - --12,04612,046 - 4 5 3 , 6 3 0 - 3 , 0 9 6 , 2 8 3 3 , 5 4 9 , 9 1 3 Co m m i t t e d Pa r k s a n d R e c r e a t i o n - -305,804-305,804 As s i g n e d Ca p i t a l P r o j e c t s - --504,314504,314 Un a s s i g n e d 4, 0 8 3 , 8 3 5 - -(571,615)3,512,220 To t a l F u n d B a l a n c e s 4, 2 2 3 , 8 2 0 4 6 1 , 8 2 5 3 2 0 , 3 7 0 3 , 0 4 0 , 8 0 7 8 , 0 4 6 , 8 2 2 Ge n e r a l Special Revenue NO T E 4 – O T H E R I N F O R M A T I O N RI S K M A N A G E M E N T Th e C i t y i s e x p o s e d t o v a r i o u s r i s k s o f l o s s r e l a t e d t o t o r t s ; t h e f t o f , d a m a g e t o a n d d e s t r u c t i o n o f a s s e t s ; er r o r s a n d o m i s s i o n s ; n a t u r a l d i s a s t e r s ; a n d i n j u r i e s t o t h e C i t y ’ s e m p l o y e e s . T h e C i t y h a s p u r c h a s e d in s u r a n c e f r o m p r i v a t e i n s u r a n c e c o m p a n i e s . R i s k s c o v e r e d i n c l u d e d c e r t a i n t y p e s o f l i a b i l i t i e s a n d bo n d s . P r e m i u m s h a v e b e e n d i s p l a y e d a s e x p e n d i t u r e s / e x p e n s e s i n a p p r o p r i a t e f u n d s . T h e r e w e r e n o si g n i f i c a n t c h a n g e s i n i n s u r a n c e c o v e r a g e s f r o m t h e p r i o r y e a r a n d s e t t l e m e n t s d i d n o t e x c e e d i n s u r a n c e co v e r a g e i n a n y o f t h e p a s t t h r e e f i s c a l y e a r s . 119 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d CO N T I N G E N T L I A B I L I T I E S Li t i g a t i o n Th e C i t y i s a d e f e n d a n t i n v a r i o u s l a w s u i t s . A l t h o u g h t h e o u t c o m e o f t h e s e l a w s u i t s i s n o t p r e s e n t l y de t e r m i n a b l e , i n t h e o p i n i o n o f t h e C i t y ' s a t t o r n e y , t h e r e s o l u t i o n o f t h e s e m a t t e r s w i l l n o t h a v e a ma t e r i a l a d v e r s e e f f e c t o n t h e f i n a n c i a l c o n d i t i o n o f t h e C i t y . Gr a n t s Am o u n t s r e c e i v e d o r r e c e i v a b l e f r o m g r a n t o r a g e n c i e s a r e s u b j e c t t o a u d i t a n d a d j u s t m e n t b y g r a n t o r ag e n c i e s , p r i n c i p a l l y t h e f e d e r a l g o v e r n m e n t . A n y d i s a l l o w e d c l a i m s , i n c l u d i n g a m o u n t s a l r e a d y co l l e c t e d , m a y c o n s t i t u t e a l i a b i l i t y o f t h e a p p l i c a b l e f u n d s . T h e a m o u n t , i f a n y , o f e x p e n d i t u r e s w h i c h ma y b e d i s a l l o w e d b y t h e g r a n t o r c a n n o t b e d e t e r m i n e d a t t h i s t i m e a l t h o u g h t h e C i t y e x p e c t s s u c h am o u n t s , i f a n y , t o b e i m m a t e r i a l . CO M M I T T M E N T S Ag r e e m e n t s w i t h D e v e l o p e r s – G o v e r n m e n t a l A c t i v i t i e s Un d e r a D e v e l o p m e n t / E c o n o m i c I n i t i a t i v e A g r e e m e n t e n t e r e d i n t o i n M a r c h o f 2 0 0 0 , t h e C i t y a g r e e d t o re i m b u r s e e l i g i b l e c o s t s a s s o c i a t e d w i t h a d e v e l o p m e n t l o c a t e d a t R o u t e 4 7 a n d R o u t e 3 4 . E l i g i b l e c o s t s o f $2 , 0 7 4 , 8 3 3 a n d a c c r u e d i n t e r e s t a t 5 % a r e t o b e r e i m b u r s e d f r o m 5 0 % o f t h e s a l e s t a x g e n e r a t e d i n t h e de v e l o p m e n t , l i m i t e d t o a p e r i o d o f e i g h t e e n y e a r s . T h r o u g h A p r i l 3 0 , 2 0 1 3 , t h e C i t y h a s r e i m b u r s e d $1 , 7 2 0 , 8 1 1 , i n c l u d i n g $ 1 3 3 , 4 4 1 i n t h e c u r r e n t y e a r . A l l p a y m e n t s h a v e b e e n r e c o r d e d a s a n e x p e n d i t u r e o f th e G e n e r a l F u n d . Un d e r a D e v e l o p m e n t a n d A n n e x a t i o n A g r e e m e n t e n t e r e d i n t o i n J u l y o f 2 0 0 0 , a m e n d e d i n O c t o b e r o f 20 0 1 , t h e C i t y a g r e e d t o r e i m b u r s e e l i g i b l e c o s t s a s s o c i a t e d w i t h a d e v e l o p m e n t l o c a t e d a t R o u t e 4 7 a n d Ke n n e d y R o a d . E l i g i b l e c o s t s o f $ 8 , 6 3 9 , 3 3 4 a r e t o b e r e i m b u r s e d f r o m 5 0 % o f t h e s a l e s t a x g e n e r a t e d i n th e d e v e l o p m e n t , l i m i t e d t o a p e r i o d o f t e n y e a r s . T h r o u g h A p r i l 3 0 , 2 0 1 3 , t h e C i t y h a s r e i m b u r s e d $1 , 6 0 4 , 1 3 6 , i n c l u d i n g $ 1 8 2 , 7 6 4 i n t h e c u r r e n t y e a r . A l l p a y m e n t s h a v e b e e n r e c o r d e d a s a n e x p e n d i t u r e o f th e G e n e r a l F u n d . Un d e r a D e v e l o p m e n t / E c o n o m i c I n i t i a t i v e A g r e e m e n t e n t e r e d i n t o i n J u n e o f 2 0 0 2 , t h e C i t y a g r e e d t o re i m b u r s e e l i g i b l e c o s t s a s s o c i a t e d w i t h a d e v e l o p m e n t l o c a t e d a t R o u t e 3 4 a n d C a n n o n b a l l T r a i l . E l i g i b l e co s t s o f $ 1 6 6 , 0 5 5 a r e t o b e r e i m b u r s e d f r o m 5 0 % o f t h e s a l e s t a x g e n e r a t e d i n t h e d e v e l o p m e n t , l i m i t e d t o a p e r i o d o f f i f t e e n y e a r s . T h r o u g h A p r i l 3 0 , 2 0 1 3 , t h e C i t y h a s r e i m b u r s e d $ 1 2 5 , 3 7 3 , i n c l u d i n g $ 1 7 , 4 8 1 i n th e c u r r e n t y e a r . A l l p a y m e n t s h a v e b e e n r e c o r d e d a s a n e x p e n d i t u r e o f t h e G e n e r a l F u n d . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d CO M M I T T M E N T S – Co n t i n u e d Ag r e e m e n t s w i t h D e v e l o p e r s – G o v e r n m e n t a l A c t i v i t i e s – Continued Un d e r a n A n n e x a t i o n A g r e e m e n t e n t e r e d i n t o i n A p r i l o f 2 0 0 6 , t h e C i t y a g r e e d t o r e i m b u r s e e l i g i b l e c o s t s as s o c i a t e d w i t h a d e v e l o p m e n t l o c a t e d a t R o u t e 4 7 b e tw e e n B a s e L i n e R o a d a n d C o r n e i l s R o a d . E l i g i b l e co s t s a r e t o b e r e i m b u r s e d f r o m 5 5 % o f C i t y A d m i s s i o n s T a x e s c o l l e c t e d , l i m i t e d t o a p e r i o d o f t e n y e a r s . Th r o u g h A p r i l 3 0 , 2 0 1 3 , t h e C i t y h a s r e i m b u r s e d $ 2 0 4 , 8 0 4 , i n c l u d i n g $ 1 1 9 , 1 9 8 i n t h e c u r r e n t y e a r . A l l pa y m e n t s h a v e b e e n r e c o r d e d a s a n e x p e n d i t u r e o f t h e G e n e r a l F u n d . T h e a g r e e m e n t w a s a m e n d e d i n Au g u s t o f 2 0 1 1 t o r e b a t e 1 0 0 % o f a d m i s s i o n s t a x r e c e i v e d b y t h e C i t y f r o m t h e d e v e l o p e r f o r a p e r i o d o f te n y e a r s , a n d t h e a d m i s s i o n s t a x r a t e w a s d e c r e a s e d f r o m 5 % t o 2 . 7 5 % . T h e 1 0 0 % r e b a t e w e n t i n t o e f f e c t be g i n n i n g w i t h t h e c u r r e n t f i s c a l y e a r . Un d e r a D e v e l o p m e n t / E c o n o m i c I n i t i a t i v e A g r e e m e n t e n t e r e d i n t o i n J a n u a r y o f 2 0 0 7 , t h e C i t y a g r e e d t o re i m b u r s e e l i g i b l e c o s t s a s s o c i a t e d w i t h a d e v e l o pm e n t l o c a t e d a t R o u t e 4 7 a n d C o r n e i l s R o a d . E l i g i b l e co s t s o f $ 2 8 7 , 3 9 2 a r e t o b e r e i m b u r s e d f r o m 5 0 % o f t h e s a l e s t a x g e n e r a t e d i n t h e d e v e l o p m e n t , l i m i t e d t o a p e r i o d o f t w e n t y y e a r s . T h r o u g h A p r i l 3 0 , 2 0 1 3 , t h e C i t y h a s r e i m b u r s e d $ 2 3 , 4 0 4 , i n c l u d i n g $ 0 i n t h e cu r r e n t y e a r . A l l p a y m e n t s h a v e b e e n r e c o r d e d a s a n e x p e n d i t u r e o f t h e G e n e r a l F u n d . Un d e r a D e v e l o p m e n t A g r e e m e n t e n t e r e d i n t o i n J u n e o f 2 0 0 7 , t h e C i t y a g r e e d t o c r e a t e a b u s i n e s s di s t r i c t i n t h e a r e a a r o u n d R o u t e 3 4 a n d C a n n o n b a l l T r a i l . U n d e r t h e a g r e e m e n t , 5 0 % o f s a l e s t a x a n d 10 0 % o f t h e b u s i n e s s d i s t r i c t t a x g e n e r a t e d i n t h e d i s t r i c t a r e r e m i t t e d b y t h e C i t y t o a n e s c r o w a g e n t t o pa y t h e d e b t s e r v i c e o n t h e R e v e n u e B o n d s o f 2 0 0 7 . T h e b o n d s a r e s e c u r e d s o l e l y b y t h e p l e d g e d re v e n u e s a n d a r e n o t o b l i g a t i o n s o f t h e C i t y a n d a r e t h e r e f o r e n o t r e c o r d e d o n t h e C i t y ’ s b o o k s . A l l pa y m e n t s h a v e b e e n r e c o r d e d a s a n e x p e n d i t u r e o f t h e G e n e r a l F u n d . E x p e n d i t u r e s i n t h e c u r r e n t y e a r we r e $ 4 0 1 , 4 8 3 f o r s a l e s t a x e s a n d $ 3 1 4 , 3 8 5 i n b u s i n e s s d i s t r i c t t a x e s . In F e b r u a r y o f 2 0 1 1 , t h e C i t y a m e n d e d a D e v e l o p m e n t / E c o n o m i c I n i t i a t i v e A g r e e m e n t d a t e d A p r i l 2 0 0 7 . Un d e r t h e o r i g i n a l a g r e e m e n t , t h e C i t y a g r e e d t o r e i m b u r s e 2 0 % o f e l i g i b l e c o s t s a s s o c i a t e d w i t h a de v e l o p m e n t l o c a t e d a t R o u t e 4 7 a n d F o u n t a i n v i e w D r i v e f r o m 5 0 % o f t h e s a l e s t a x g e n e r a t e d i n t h e de v e l o p m e n t , l i m i t e d t o a p e r i o d o f t w e n t y y e a r s . U n d e r t h e a m e n d e d a g r e e m e n t , t h e C i t y w i l l h o l d t h e sa l e s t a x r e b a t e s i n a n e s c r o w a c c o u n t u n t i l c e r t a i n l a n d i m p r o v e m e n t s h a s b e e n c o m p l e t e d . T h r o u g h Ap r i l 3 0 , 2 0 1 3 , t h e C i t y i s h o l d i n g $ 3 , 1 6 4 i n e s c r o w . N o r e i m b u r s e m e n t s h a v e y e t b e e n m a d e . Un d e r a D e v e l o p m e n t / E c o n o m i c I n i t i a t i v e A g r e e m e n t e n t e r e d i n t o o n D e c e m b e r 2 2 , 2 0 1 1 t h e C i t y a g r e e d to r e i m b u r s e e l i g i b l e c o s t s a s s o c i a t e d w i t h a d e v e l o p m e n t l o c a t e d w e s t o f R o u t e 4 7 a n d n o r t h o f Ca n n o n b a l l T r a i l o n B o o m b a h B o u l e v a r d . E l i g i b l e c o s t s o f $ 2 8 7 , 3 9 2 a r e t o b e r e i m b u r s e d f r o m 5 0 % o f th e s a l e s t a x g e n e r a t e d i n t h e d e v e l o p m e n t , l i m i t e d t o a p e r i o d o f t e n y e a r s . T h r o u g h A p r i l 3 0 , 2 0 1 3 , t h e Ci t y h a s r e i m b u r s e d $ 7 , 8 5 6 . A l l p a y m e n t s h a v e b e e n r e c o r d e d a s a n e x p e n d i t u r e o f t h e G e n e r a l F u n d . Un d e r a D e v e l o p m e n t / E c o n o m i c I n i t i a t i v e A g r e e m e n t e n t e r e d i n t o o n S e p t e m b e r 1 8 , 2 0 1 2 t h e C i t y ag r e e d t o r e i m b u r s e e l i g i b l e c o s t s a s s o c i a t e d w i t h a d e v e l o p m e n t l o c a t e d a t 7 0 4 E a s t V e t e r a n s P a r k w a y . El i g i b l e c o s t s o f $ 3 0 , 7 4 0 a r e t o b e r e i m b u r s e d f r o m 5 0 % o f t h e s a l e s t a x g e n e r a t e d i n t h e d e v e l o p m e n t , li m i t e d t o a p e r i o d o f t e n y e a r s . T h r o u g h A p r i l 3 0 , 2 0 1 3 , t h e C i t y h a s r e i m b u r s e d $ 6 8 6 . A l l p a y m e n t s ha v e b e e n r e c o r d e d a s a n e x p e n d i t u r e o f t h e G e n e r a l F u n d . 120 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d CO M M I T T M E N T S – Co n t i n u e d Ag r e e m e n t s w i t h D e v e l o p e r s – B u s i n e s s - T y p e A c t i v i t i e s Un d e r a n a g r e e m e n t e n t e r e d i n t o i n t h e f i s c a l y e a r e n d i n g A p r i l 2 0 0 3 , t h e C i t y a n d d e v e l o p e r o f t h e Wi n d e t t R i d g e s u b d i v i s i o n a g r e e d u p o n a n a d v a n c e o f u p t o $ 1 7 0 , 0 0 0 f o r s a n i t a r y s e w e r s y s t e m im p r o v e m e n t s . T h e C i t y i s r e q u i r e d t o r e p a y t h e a d v a n c e t o t h e d e v e l o p e r w i t h i n a t e n y e a r p e r i o d o f re c e i p t o f t h e l o a n . U n d e r a n a m e n d m e n t t o t h e a g r e e m e n t s i g n e d i n f i s c a l y e a r e n d i n g A p r i l 2 0 0 5 , t h e Ci t y a n d t h e d e v e l o p e r a g r e e d t o r e d u c e t h e b a l a n c e b y t h e a m o u n t o f o u t s t a n d i n g l o t f e e s d u e t h e C i t y . Pe r t h e a m e n d m e n t , t h e n e w l o a n a m o u n t i s $ 1 1 4 , 6 0 0 w h i c h i s d u e t o t h e d e v e l o p e r b y O c t o b e r 2 1 , 2 0 1 3 . Th i s l o a n i s r e c o r d e d i n t h e S e w e r F u n d a n d i s t o b e p a i d w i t h s e w e r c o n n e c t i o n f e e s . Un d e r a n a g r e e m e n t e n t e r e d i n t o i n D e c e m b e r o f 2 0 0 2 , t h e C i t y a n d d e v e l o p e r o f t h e R a i n t r e e V i l l a g e su b d i v i s i o n a g r e e d t o r e i m b u r s e t h e c o s t s o f s a n i t a r y s e w e r o v e r - s i z i n g w i t h i n t h e d e v e l o p m e n t . T h e am o u n t o f e l i g i b l e e x p e n s e s t o b e r e i m b u r s e d b y t h e C i t y t o t a l s $ 1 , 1 5 4 , 7 1 8 , o f w h i c h $ 9 3 2 , 3 0 9 h a s b e e n pa i d t h r o u g h A p r i l 3 0 , 2 0 1 3 . T h e r e m a i n i n g b a l a n c e , $ 2 2 2 , 9 3 0 , i s s u b j e c t t o i n t e r e s t b a s e d o n t h e t w e l v e mo n t h L I B O R . A n n u a l s e w e r c h a r g e s a s s e s s e d o n t h e r e s i d e n t s o f t h e s u b d i v i s i o n a r e e a r m a r k e d t o r e p a y th i s o b l i g a t i o n . T h e r e l a t e d s a n i t a r y s e w e r i n f r a s t r u c t u r e w a s a c c e p t e d b y t h e C i t y a s a n a s s e t i n D e c e m b e r of 2 0 0 7 . T h i s a m o u n t i s r e c o r d e d i n t h e S e w e r F u n d . Un d e r a p l a n n e d u n i t d e v e l o p m e n t a g r e e m e n t e n t e r e d i n t o i n J u n e o f 2 0 0 3 , t h e C i t y a g r e e d t o r e i m b u r s e th e d e v e l o p e r o f t h e G r a n d R e s e r v e s u b d i v i s i o n f o r r e g i o n a l w a t e r i m p r o v e m e n t s r e q u i r e d t o s u p p o r t t h e su b d i v i s i o n a n d t h e s u r r o u n d i n g a r e a . I n M a y o f 2 0 0 9 , t h e t w o p a r t i e s a g r e e d u p o n t h e r e p a y m e n t o f $8 2 7 , 5 9 6 o f e l i g i b l e c o s t s d u e i n t h i r t y - s i x m o n t h l y i n s t a l l m e n t o f $ 2 2 , 9 8 9 b e g i n n i n g D e c e m b e r 2 0 0 9 . A s of A p r i l 3 0 , 2 0 1 3 , t h e C i t y h a s r e p a i d $ 8 2 7 , 5 9 6 . W a t e r c o n n e c t i o n f e e s g e n e r a t e d w i t h i n s p e c i f i c w a t e r pr e s s u r e z o n e h a v e b e e n e a r m a r k e d t o r e p a y t h e d e v e l o p e r . A s o f A p r i l 3 0 , 2 0 1 3 , t h e C i t y h a d n o t ac c e p t e d t h e w a t e r i n f r a s t r u c t u r e a s s e t s f r o m t h e d e v e l o p e r . T h i s l i a b i l i t y i s r e c o r d e d i n t h e W a t e r F u n d . Th i s c o m m i t m e n t h a s b e e n p a i d i n f u l l a s o f A p r i l 3 0 , 2 0 1 3 . Un d e r a r e i m b u r s e m e n t a g r e e m e n t e n t e r e d i n t o i n A u g u s t o f 2 0 0 3 , t h e C i t y a n d t h e d e v e l o p e r o f t h e F o x Hi l l s u b d i v i s i o n a g r e e d t o r e i m b u r s e e l i g i b l e c o s t s a s s o c i a t e d w i t h t h e c o n s t r u c t i o n a n d o v e r - s i z i n g o f wa t e r a n d s e w e r i n f r a s t r u c t u r e l i n e s w i t h i n t h e a r e a . E l i g i b l e c o s t s a r e t o b e p a i d t o t h e d e v e l o p e r w i t h i n tw e n t y y e a r s o f t h e a g r e e m e n t . T h i s a g r e e m e n t w a s a m e n d e d i n A p r i l 2 0 0 6 t o i n c l u d e a d d i t i o n a l c o s t s . To t a l e l i g i b l e c o s t s r e m a i n a s o f A p r i l 3 0 , 2 0 1 3 a r e $ 8 0 7 , 8 4 7 , w h i c h a c c r u e s c o m p o u n d e d i n t e r e s t o f 5 % an n u a l l y . I n t e r e s t f o r a p o r t i o n o f e l i g i b l e c o s t s w a s c o m p u t e d b a c k t o J a n u a r y 1 , 1 9 9 5 . T o t a l i n t e r e s t t o da t e i s $ 6 5 7 , 0 0 9 . T h e a m o u n t r e c o r d e d a s a l i a b i l i t y , i n c l u d i n g i n t e r e s t , a s o f A p r i l 3 0 , 2 0 1 3 i s $1 , 6 1 5 , 0 0 4 . 5 2 % o f t h i s a m o u n t i s r e c o r d e d i n t h e W a t e r F u n d . T h e r e m a i n i n g 4 8 % o f t h i s a m o u n t i s re c o r d e d i n t h e S e w e r F u n d . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S Th e C i t y c o n t r i b u t e s t o t w o d e f i n e d b e n e f i t p e n s i o n p l a n s , t h e I l l i n o i s M u n i c i p a l R e t i r e m e n t F u n d , a de f i n e d b e n e f i t a g e n t m u l t i p l e - e m p l o y e r p u b l i c e m p l o y e e r e t i r e m e n t s y s t e m a n d t h e P o l i c e P e n s i o n Pl a n w h i c h i s a s i n g l e - e m p l o y e r p e n s i o n p l a n . A s e p a ra t e r e p o r t i s i s s u e d f o r t h e P o l i c e P e n s i o n P l a n an d m a y b e o b t a i n e d b y w r i t i n g t o t h e C i t y a t 8 0 0 G a m e F a r m R o a d , Y o r k v i l l e , I l l i n o i s 6 0 5 6 0 . I M R F do e s i s s u e a p u b l i c l y a v a i l a b l e f i na n c i a l r e p o r t t h a t i n c l u d e s f i n a n c i a l s t a t e m e n t s a n d r e q u i r e d su p p l e m e n t a r y i n f o r m a t i o n f o r t h e p l a n a s a w h o l e , b u t n o t b y i n d i v i d u a l e m p l o y e r . T h a t r e p o r t m a y b e ob t a i n e d o n - l i n e a t ww w . i m r f . o r g . T h e b e n e f i t , b e n e f i t l e v e l s , e m p l o y e e c o n t r i b u t i o n s , a n d e m p l o y e r co n t r i b u t i o n s a r e g o v e r n e d b y I l l i n o i s C o m p i l e d S t a t u t e s a n d c a n o n l y b e a m e n d e d b y t h e I l l i n o i s Ge n e r a l A s s e m b l y . Pl a n D e s c r i p t i o n s , P r o v i s i o n s a n d F u n d i n g P o l i c i e s Il l i n o i s M u n i c i p a l R e t i r e m e n t S y s t e m ( I M R F ) Al l e m p l o y e e s ( o t h e r t h a n t h o s e c o v e r e d b y t h e P o l i c e P e n s i o n p l a n ) h i r e d i n p o s i t i o n s t h a t m e e t o r ex c e e d t h e p r e s c r i b e d a n n u a l h o u r l y s t a n d a r d m u s t b e e n r o l l e d i n I M R F a s p a r t i c i p a t i n g m e m b e r s . Pa r t i c i p a t i n g m e m b e r s h i r e d b e f o r e J a n u a r y 1 , 2 0 1 1 w h o r e t i r e a t o r a f t e r a g e 6 0 w i t h 8 y e a r s o f s e r v i c e ar e e n t i t l e d t o a n a n n u a l r e t i r e m e n t b e n e f i t , p a y a b l e m o n t h l y f o r l i f e , i n a n a m o u n t e q u a l t o 1 - 2 / 3 pe r c e n t o f t h e i r f i n a l r a t e ( a v e r a g e o f t h e h i g h e s t 4 8 c o n s e c u t i v e m o n t h s ' e a r n i n g s d u r i n g t h e l a s t 1 0 ye a r s ) o f e a r n i n g s , f o r e a c h y e a r o f c r e d i t e d s e r v i c e u p t o 1 5 y e a r s , a n d 2 p e r c e n t f o r e a c h y e a r th e r e a f t e r . T h e m o n t h l y p e n s i o n o f a m e m b e r h i r e d b e f o r e J a n u a r y 1 , 2 0 1 1 , s h a l l b e i n c r e a s e d a n n u a l l y by 3 % o f t h e o r i g i n a l p e n s i o n . E m p l o y e e s w i t h a t l e a s t 8 y e a r s o f c r e d i t e d s e r v i c e m a y r e t i r e a t o r a f t e r ag e 5 5 a n d r e c e i v e a r e d u c e d b e n e f i t . Fo r p a r t i c i p a t i n g m e m b e r s h i r e d o n o r a f t e r J a n u a r y 1 , 2 0 1 1 w h o r e t i r e a t o r a f t e r a g e 6 7 w i t h 1 0 y e a r s of s e r v i c e a r e e n t i t l e d t o a n a n n u a l r e t i r e m e n t b e n e f i t , p a y a b l e m o n t h l y f o r l i f e i n a n a m o u n t e q u a l t o 1 - 2/ 3 p e r c e n t o f t h e i r f i n a l r a t e ( a v e r a g e o f t h e h i g h e s t 9 6 c o n s e c u t i v e m o n t h s ’ e a r n i n g s d u r i n g t h e l a s t 1 0 ye a r s ) o f e a r n i n g s , f o r e a c h y e a r o f c r e d i t e d s e r v i c e , w i t h a m a x i m u m s a l a r y c a p o f $ 1 0 6 , 8 0 0 a t J a n u a r y 1, 2 0 1 1 . T h e m a x i m u m s a l a r y c a p i n c r e a s e s e a c h y e a r t h e r e a f t e r . T h e m o n t h l y p e n s i o n o f a m e m b e r hi r e d o n o r a f t e r J a n u a r y 1 , 2 0 1 1 , s h a l l b e i n c r e a s e d a n n u a l l y , f o l l o w i n g t h e l a t e r o f t h e f i r s t a n n i v e r s a r y da t e o f r e t i r e m e n t o r t h e m o n t h f o l l o w i n g t h e a t t a i n m e n t o f a g e 6 2 , b y t h e l e s s e r o f 3 % o r ½ o f t h e co n s u m e r p r i c e i n d e x . E m p l o y e e s w i t h a t l e a s t 1 0 ye a r s o f c r e d i t e d s e r v i c e m a y r e t i r e a t o r a f t e r a g e 6 2 an d r e c e i v e a r e d u c e d b e n e f i t . IM R F a l s o p r o v i d e s d e a t h a n d d i s a b i l i t y b e n e f i t s . Th e s e b e n e f i t p r o v i s i o n s a nd all other requirements ar e e s t a b l i s h e d b y s t a t e s t a t u t e . E m p l o y e e s p a r t i c i p a t i n g i n t h e p l a n a r e r e q u i r e d t o c o n t r i b u t e 4 . 5 0 pe r c e n t o f t h e i r a n n u a l c o v e r e d s a l a r y t o I M R F . T h e e m p l o y e e s ’ c o n t r i b u t i o n r a t e i s e s t a b l i s h e d b y s t a t e st a t u t e . T h e C i t y i s r e q u i r e d t o c o n t r i b u t e t h e r e m a i n i n g a m o u n t n e c e s s a r y t o f u n d t h e I M R F p l a n a s sp e c i f i e d b y s t a t u t e . F o r t h e c a l e n d a r y e a r 2 0 1 2 t h e e m p l o y e r a n n u a l r e q u i r e d c o n t r i b u t i o n r a t e w a s 9 . 6 4 pe r c e n t . 121 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S – Co n t i n u e d Pl a n D e s c r i p t i o n s , P r o v i s i o n s a n d F u n d i n g P o l i c i e s – C o n t i n u e d Po l i c e P e n s i o n P l a n Th e P o l i c e P e n s i o n P l a n i s a s i n g l e - e m p l o y e r d e f i n e d b e n e f i t p e n s i o n p l a n t h a t c o v e r s a l l s w o r n p o l i c e pe r s o n n e l . A l t h o u g h t h i s i s a s i n g l e - e m p l o y e r p e n s i o n p l a n , t h e d e f i n e d b e n e f i t s a n d e m p l o y e e a n d em p l o y e r c o n t r i b u t i o n l e v e l s a r e g o v e r n e d b y I l l i n o i s S t a t e S t a t u t e s a n d m a y b e a m e n d e d o n l y b y t h e Il l i n o i s l e g i s l a t u r e . T h e C i t y a c c o u n t s f o r t h e p l a n a s a p e n s i o n t r u s t f u n d . At A p r i l 3 0 , 2 0 1 2 , t h e d a t e o f t h e m o s t r e c e n t a c t u a r i a l v a l u a t i o n , t h e P o l i c e P e n s i o n P l a n m e m b e r s h i p co n s i s t e d o f : Re t i r e e s a n d B e n e f i c i a r i e s C u r r e n t l y R e c e i v i n g Be n e f i t s a n d T e r m i n a t e d E m p l o y e e s E n t i t l e d to B e n e f i t s b u t n o t y e t R e c e i v i n g T h e m 6 Cu r r e n t E m p l o y e e s Ve s t e d 13 No n v e s t e d 12 31 Th e f o l l o w i n g i s a s u m m a r y o f t h e P o l i c e P e n s i o n P l a n a s p r o v i d e d f o r i n I l l i n o i s S t a t e S t a t u t e s . Th e P o l i c e P e n s i o n P l a n p r o v i d e s r e ti r e m e n t b e n e f i t s a s w e l l a s d e a t h a n d d i s a b i l i t y b e n e f i t s . C o v e r e d em p l o y e e s h i r e d b e f o r e J a n u a r y 1 , 2 0 1 1 , a t t a i n i n g t h e a g e o f 5 0 o r m o r e w i t h 2 0 o r m o r e y e a r s o f cr e d i t a b l e s e r v i c e a r e e n t i t l e d t o r e c e i v e a n a n n u a l r e t i r e m e n t b e n e f i t o f ½ o f t h e s a l a r y a t t a c h e d t o t h e ra n k h e l d o n t h e l a s t d a y o f s e r v i c e , o r f o r o n e y e a r p r i o r t o t h e l a s t d a y , w h i c h e v e r i s g r e a t e r . T h e pe n s i o n s h a l l b e i n c r e a s e d b y 2 . 5 % o f s u c h s a l a r y f o r e a c h a d d i t i o n a l y e a r o f s e r v i c e o v e r 2 0 y e a r s u p t o 30 y e a r s , t o a m a x i m u m o f 7 5 % o f s u c h s a l a r y . C o v e r e d e m p l o y e e s h i r e d o n o r a f t e r J a n u a r y 1 , 2 0 1 1 , at t a i n i n g t h e a g e o f 5 5 w i t h a t l e a s t 1 0 y e a r s c r e d i t a b l e s e r v i c e a r e e n t i t l e d t o r e c e i v e a n a n n u a l re t i r e m e n t b e n e f i t o f 2 . 5 % o f f i n a l a v e r a g e s a l a r y f o r e a c h y e a r o f s e r v i c e , w i t h a m a x i m u m s a l a r y c a p of $ 1 0 6 , 8 0 0 a s o f J a n u a r y 1 , 2 0 1 1 . T h e m a x i m u m s a l a r y c a p i n c r e a s e s e a c h y e a r t h e r e a f t e r . T h e mo n t h l y b e n e f i t o f a p o l i c e o f f i c e r h i r e d b e f o r e J a n u a r y 1 , 2 0 1 1 , w h o r e t i r e d w i t h 2 0 o r m o r e y e a r s o f se r v i c e a f t e r J a n u a r y 1 , 1 9 7 7 s h a l l b e i n c r e a s e d a n n u a l l y , f o l l o w i n g t h e f i r s t a n n i v e r s a r y d a t e o f re t i r e m e n t a n d b e p a i d u p o n r e a c h i n g t h e a g e o f a t l e a s t 5 5 y e a r s , b y 3 % o f t h e o r i g i n a l p e n s i o n a n d 3 % co m p o u n d e d a n n u a l l y t h e r e a f t e r . T h e m o n t h l y p e n s i o n o f a p o l i c e o f f i c e r h i r e d o n o r a f t e r J a n u a r y 1 , 20 1 1 , s h a l l b e i n c r e a s e d a n n u a l l y , f o l l o w i n g t h e l a t e r o f t h e f i r s t a n n i v e r s a r y d a t e o f r e t i r e m e n t o r t h e mo n t h f o l l o w i n g t h e a t t a i n m e n t o f a g e 6 0 , b u t t h e l e s s e r o f 3 % o r ½ o f t h e c o n s u m e r p r i c e i n d e x . Em p l o y e e s w i t h a t l e a s t 1 0 y e a r s b u t l e s s t h a n 2 0 ye a r s o f c r e d i t a b l e s e r v i c e m a y r e t i r e a t o r a f t e r a g e 60 a n d r e c e i v e a r e d u c e d b e n e f i t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – C o n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S –Continued Pl a n D e s c r i p t i o n s , P r o v i s i o n s , a n d F u n d i n g P o l i c i e s – C o n t i n u e d Po l i c e P e n s i o n P l a n – C o n t i n u e d Co v e r e d e m p l o y e e s a r e r e q u i r e d t o c o n t r i b u t e 9 . 9 1 % o f t h e i r b a s e s a l a r y t o t h e P o l i c e P e n s i o n P l a n . I f a n em p l o y e e l e a v e s c o v e r e d e m p l o y m e n t w i t h l e s s t h a n 2 0 y e a r s o f s e r v i c e , a c c u m u l a t e d e m p l o y e e co n t r i b u t i o n s m a y b e r e f u n d e d w i t h o u t a c c u m u l a t e d i n t e r e s t . T h e C i t y i s r e q u i r e d t o c o n t r i b u t e t h e re m a i n i n g a m o u n t s n e c e s s a r y t o f i n a n c e t h e p l a n , i n c l u d i n g a d m i n i s t r a t i v e c o s t s , a s a c t u a r i a l l y d e t e r m i n e d by a n e n r o l l e d a c t u a r y . B y t h e y e a r 2 0 4 0 t h e C i t y ' s c o n t r i b u t i o n s m u s t a c c u m u l a t e t o t h e p o i n t w h e r e t h e pa s t s e r v i c e c o s t f o r t h e P o l i c e P e n s i o n P l a n i s 9 0 % f u n d e d . Su m m a r y o f S i g n i f i c a n t A c c o u n t i n g P o l i c i e s a n d P l a n A s s e t M a t t e r s Ba s i s o f A c c o u n t i n g Th e f i n a n c i a l s t a t e m e n t s a r e p r e p a r e d u s i n g t h e a c c r u a l b a s i s o f a c c o u n t i n g . E m p l o y e e a n d e m p l o y e r co n t r i b u t i o n s a r e r e c o g n i z e d a s re v e n u e s w h e n d u e , p u r s u a n t t o formal commitments, as well as st a t u t o r y o r c o n t r a c t u a l r e q u i r e m e n t s . B e n e f i t s a n d r e f u n d s a r e r e c o g n i z e d w h e n d u e a n d p a y a b l e i n ac c o r d a n c e w i t h t h e t e r m s o f t h e p l a n . Me t h o d U s e d t o V a l u e I n v e s t m e n t s In v e s t m e n t s a r e r e p o r t e d a t f a i r v a l u e . S h o r t - t e r m i n v e s t m e n t s a r e r e p o r t e d a t c o s t , w h i c h a p p r o x i m a t e s fa i r v a l u e . S e c u r i t i e s t r a d e d o n n a t i o n a l e x c h a n g e s a r e v a l u e d a t t h e l a s t r e p o r t e d s a l e s p r i c e . I n v e s t m e n t s th a t d o n o t h a v e a n y e s t a b l i s h e d m a r k e t , i f a n y , a r e r e p o r t e d a t e s t i m a t e d f a i r v a l u e . Si g n i f i c a n t I n v e s t m e n t s At y e a r - e n d , t h e P o l i c e P e n s i o n F u n d h a s o v e r 5 p e r c e n t o f n e t p o s i t i o n a v a i l a b l e f o r r e t i r e m e n t b e n e f i t s (o t h e r t h a n U . S . G o v e r n m e n t g u a r a n t e e d o b l i g a t i o n s ) i n v e s t e d i n S c h w a b S & P 5 0 0 I n d e x F u n d ($ 5 9 0 , 5 4 1 ) . I n f o r m a t i o n f o r I M R F i s n o t a v a i l a b l e . Re l a t e d P a r t y T r a n s a c t i o n s Th e r e a r e n o s e c u r i t i e s o f t h e e m p l o y e r o r a n y o t h e r r e l a t e d p a r t i e s i n c l u d e d i n n e t p o s i t i o n . 122 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – C o n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S – C o n t i n u e d An n u a l P e n s i o n C o s t a n d N e t P e n s i o n O b l i g a t i o n Th e p e n s i o n l i a b i l i t y f o r I M R F a n d t h e P o l i c e P e n s i o n P l a n i s a s f o l l o w s : Po l i c e Pe n s i o n T o t a l s An n u a l R e q u i r e d C o n t r i b u t i o n $ 2 4 2 , 7 7 4 5 4 2 , 6 4 8 7 8 5 , 4 2 2 In t e r e s t o n N e t P e n s i o n O b l i g a t i o n 1 , 1 9 0 4 2 , 3 6 9 4 3 , 5 5 9 Ad j u s t m e n t t o A n n u a l R e q u i r e d C o n t r i b u t i o n 7 , 6 4 4 ( 4 1 , 3 3 1 ) ( 3 3 , 6 8 7 ) An n u a l P e n s i o n C o s t 2 5 1 , 6 0 8 5 4 3 , 6 8 6 7 9 5 , 2 9 4 Ac t u a l C o n t r i b u t i o n 2 6 7 , 4 7 1 4 3 8 , 7 1 1 7 0 6 , 1 8 2 Ch a n g e i n N P O ( 1 5 , 8 6 3 ) 1 0 4 , 9 7 5 8 9 , 1 1 2 NP O - B e g i n n i n g o f Y e a r 1 5 , 8 6 3 5 4 8 , 4 4 8 5 6 4 , 3 1 1 NP O - E n d o f Y e a r - 6 5 3 , 4 2 3 6 5 3 , 4 2 3 IM R F UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S –Continued An n u a l P e n s i o n C o s t a n d N e t P e n s i o n O b l i g a t i o n – C o n t i n u e d Th e C i t y ’ s a n n u a l p e n s i o n c o s t f o r t h e c u r r e n t y e a r a n d r e l a t e d i n f o r m a t i o n f o r e a c h p l a n i s a s f o l l o w s : Police IM R F P e n s i o n Co n t r i b u t i o n R a t e s Em p l o y e r 9 . 6 4 % 2 0 . 2 3 % Em p l o y e e 4 . 5 0 % 9 . 9 1 % Ac t u a r i a l V a l u a t i o n D a t e 1 2 / 3 1 / 2 0 1 2 4 / 3 0 / 2 0 1 2 Ac t u a r i a l C o s t M e t h o d E n t r y A g e E n t r y A g e No r m a l N o r m a l Am o r t i z a t i o n M e t h o d L e v e l % o f L e v e l % o f Pr o j e c t e d P a y r o l l P r o j e c t e d P a y r o l l Op e n B a s i s C l o s e d B a s i s Re m a i n i n g A m o r t i z a t i o n P e r i o d 3 0 Y e a r s 2 9 Y e a r s As s e t V a l u a t i o n M e t h o d 5 - Y e a r M a r k e t Sm o o t h e d M a r k e t Ac t u a r i a l A s s u m p t i o n s In v e s t m e n t R a t e o f R e t u r n 7 . 5 0 % 7 . 5 0 % Co m p o u n d e d C o m p o u n d e d An n u a l l y A n n u a l l y Pr o j e c t e d S a l a r y I n c r e a s e s . 4 t o 1 0 . 0 % 5 . 5 0 % In f l a t i o n R a t e I n c l u d e d 4 . 0 0 % 3 . 0 0 % Co s t - o f - L i v i n g A d j u s t m e n t s 3 . 0 0 % 3 . 0 0 % 123 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S – C o n t i n u e d Tr e n d I n f o r m a t i o n Em p l o y e r a n n u a l p e n s i o n c o s t ( A P C ) , a c t u a l c o n t r i b u t i o n s a n d t h e n e t p e n s i o n o b l i g a t i o n ( N P O ) a r e a s fo l l o w s . T h e N P O i s t h e c u m u l a t i v e d i f f e r e n c e b e t w e e n t h e A P C a n d t h e c o n t r i b u t i o n s a c t u a l l y m a d e . Fi s c a l Ye a r An n u a l P e n s i o n C o s t 2 0 1 1 $ 3 1 0 , 9 3 3 $ 4 8 9 , 5 2 3 (A P C ) 2 0 1 2 2 5 3 , 6 3 6 5 1 0 , 4 7 9 20 1 3 2 5 1 , 6 0 8 5 4 3 , 6 8 6 Ac t u a l C o n t r i b u t i o n s 2 0 1 1 2 9 5 , 4 0 2 3 3 6 , 0 7 5 20 1 2 2 5 3 , 3 0 4 3 6 0 , 3 5 6 20 1 3 2 6 7 , 4 7 1 4 3 8 , 7 1 1 Pe r c e n t a g e o f A P C 2 0 1 1 1 0 0 . 0 0 % 6 8 . 6 5 % Co n t r i b u t e d 2 0 1 2 9 9 . 8 7 % 7 0 . 5 9 % 20 1 3 1 0 6 . 3 0 % 8 0 . 6 9 % Ne t P e n s i o n O b l i g a t i o n 2 0 1 1 1 5 , 5 3 1 3 9 8 , 3 2 5 20 1 2 1 5 , 8 6 3 5 4 8 , 4 4 8 20 1 3 - 65 3 , 4 2 3 IM R F P e n s i o n Po l i c e UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S –Continued Fu n d e d S t a t u s a n d F u n d i n g P r o g r e s s Th e C i t y ’ s f u n d e d s t a t u s f o r t h e c u r r e n t y e a r a n d r e la t e d i n f o r m a t i o n f o r e a c h p l a n i s a s f o l l o w s : Police IMRFPension Ac t u a r i a l V a l u a t i o n D a t e 1 2 / 3 1 / 2 0 1 2 4 / 3 0 / 2 0 1 2 Pe r c e n t F u n d e d 8 0 . 3 3 % 4 2 . 8 0 % Ac c u a r i a l A c c r u e d L i a b i l i t y fo r B e n e f i t s $ 5 , 2 4 7 , 5 6 2 $ 1 0 , 4 6 3 , 7 3 7 Ac t u a r i a l V a l u e o f A s s e t s $ 4 , 2 1 5 , 1 1 3 $ 4 , 4 8 1 , 6 0 1 Ov e r ( U n d e r ) F u n d e d A c t u a r i a l Ac c r u e d L i a b i l i t y ( U A A L ) ( $ 1 , 0 3 2 , 4 4 9 ) ( $ 5 , 9 8 2 , 1 3 6 ) Co v e r e d P a y r o l l ( A n n u a l P a y r o l l of A c t i v e E m p l o y e e s C o v e r e d by t h e P l a n ) $ 2 , 5 1 8 , 4 0 4 $ 1 , 6 9 4 , 4 4 5 Ra t i o o f U A A L t o C o v e r e d Pa y r o l l 4 1 . 0 0 % 3 5 3 . 0 4 % Th e s c h e d u l e o f f u n d i n g p r o g r e s s , p r e s e n t e d a s R e q u i r e d S u p p l e m e n t a r y I n f o r m a t i o n ( R S I ) f o l l o w i n g th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s , p r e s e n t s m u l t i y e a r t r e n d i n f o r m a t i o n a b o u t w h e t h e r t h e a c t u a r i a l va l u e o f p l a n a s s e t s a r e i n c r e a s i n g o r d e c r e a s i n g o v e r t i m e r e l a t i v e t o t h e a c t u a r i a l a c c r u e d l i a b i l i t y f o r be n e f i t s . 124 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d OT H E R P O S T - E M P L O Y M E N T B E N E F I T S Pl a n D e s c r i p t i o n s , P r o v i s i o n s , a n d F u n d i n g P o l i c i e s In a d d i t i o n t o p r o v i d i n g t h e p e n s i o n b e n e f i t s d e s c r i b e d , t h e C i t y o f f e r s p o s t - e m p l o y m e n t h e a l t h c a r e in s u r a n c e b e n e f i t s ( O P E B ) f o r i t s e l i g i b l e r e t i r e d e m p l o y e e s t h r o u g h a s i n g l e e m p l o y e r d e f i n e d b e n e f i t pl a n . T h e b e n e f i t s , b e n e f i t l e v e l s , e m p l o y e e c o n t r i b u t i o n s a n d e m p l o y e r c o n t r i b u t i o n s a r e g o v e r n e d b y th e C i t y a n d c a n b e a m e n d e d b y t h e C i t y t h r o u g h i t s p e r s o n n e l m a n u a l a n d u n i o n c o n t r a c t s . T h e p l a n i s no t a c c o u n t e d f o r a s a t r u s t f u n d , a s a n i r r e v o c a b l e t r u s t h a s n o t b e e n e s t a b l i s h e d t o a c c o u n t f o r t h e p l a n . Th e p l a n d o e s n o t i s s u e a s e p a r a t e r e p o r t . T h e a c t i v i t y o f t h e p l a n i s r e p o r t e d i n t h e C i t y ’ s G e n e r a l Fu n d . Th e C i t y o f f e r s p o s t - e m p l o y m e n t h e a l t h c a r e b e n e f i t s t o i t s r e t i r e e s . T o b e e l ig i b l e f o r b e n e f i t s , a n em p l o y e e m u s t q u a l i f y f o r r e t i r e m e n t u n d e r o n e o f t h e C i t y ’ s r e t i r e m e n t p l a n s . C u r r e n t e l e c t e d o f f i c i a l s ar e e l i g i b l e i f t h e y w e r e e l e c t e d / a p p o i n t e d p r i o r t o A p r i l , 2 0 1 3 . Al l h e a l t h c a r e b e n e f i t s a r e p r o v i d e d t h r o u g h t h e C i t y ’ s he a l t h i n s u r a n c e p l a n . T h e b e n e f i t l e v e l s a r e t h e sa m e a s t h o s e a f f o r d e d t o a c t i v e e m p l o y e e s . B e n e f it s i n c l u d e g e n e r a l i n p a t i e n t a n d o u t p a t i e n t m e d i c a l se r v i c e s ; m e n t a l , n e r v o u s , a n d s u b s t a n c e a b u s e c a r e ; v i s i o n c a r e ; d e n t a l c a r e ; a n d p r e s c r i p t i o n s . U p o n a re t i r e e r e a c h i n g 6 5 y e a r s o f a g e , M e d i c a r e b e c o m e s t h e p r i m a r y i n s u r e r a n d t h e C i t y ’ s p l a n b e c o m e s se c o n d a r y . Al l r e t i r e e s c o n t r i b u t e 1 0 0 % o f t h e a c t u a r i a l l y d e t e r m i n e d p r e m i u m t o t h e p l a n , w i t h t h e e x c e p t i o n o f tw o p r e v i o u s e m p l o y e e s f o r w h i c h t h e C i t y h a s a g r e e d t o p a y p o r t i o n s o f t h e i r p o s t - e m p l o y m e n t h e a l t h , de n t a l a n d v i s i o n i n s u r a n c e . F o r t h e f i s c a l y e a r e n d i n g A p r i l 3 0 , 2 0 1 3 , r e t i r e e s c o n t r i b u t e d $ 5 7 , 8 2 4 t o th e p l a n . A c t i v e e m p l o y e e s d o n o t c o n t r i b u t e t o t h e po s t - e m p l o y m e n t h e a l t h c a r e p l a n u n t i l r e t i r e m e n t . At A p r i l 3 0 , 2 0 1 3 , m e m b e r s h i p c o n s i s t e d o f : Re t i r e e s a n d B e n e f i c i a r i e s C u r r e n t l y R e c e i v i n g Be n e f i t s a n d T e r m i n a t e d E m p l o y e e s E n t i t l e d to B e n e f i t s b u t n o t y e t R e c e i v i n g T h e m 8 Ac t i v e E m p l o y e e s 7 8 To t a l 8 6 Pa r t i c i p a t i n g E m p l o y e r s 1 Th e C i t y d o e s n o t c u r r e n t l y h a v e a f u n d i n g p o l i c y . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d OT H E R P O S T - E M P L O Y M E N T B E N E F I T S – C o n t i n u e d An n u a l O P E B C o s t s a n d N e t O P E B O b l i g a t i o n Th e n e t O P E B o b l i g a t i o n ( N O P E B O ) a s o f A p r i l 3 0 , 2 0 1 3 , w a s c a l c u l a t e d a s f o l l o w s : An n u a l R e q u i r e d C o n t r i b u t i o n $36,363 In t e r e s t o n t h e N e t O P E B O b l i g a t i o n 473 Ad j u s t m e n t t o t h e A R C (316) An n u a l O P E B C o s t 36,520 Ac t u a l C o n t r i b u t i o n 38,046 In c r e a s e i n t h e n e t O P E B O b l i g a t i o n (1,526) Ne t O P E B O b l i g a t i o n - B e g i n n i n g o f Y e a r 9,453 Ne t O P E B O b l i g a t i o n - E n d o f Y e a r 7,927 Tr e n d I n f o r m a t i o n Th e C i t y ’ s a n n u a l O P E B c o s t , a c t u a l c o n t r i b u t i o n s , t h e p e r c e n t a g e o f a n n u a l O P E B c o s t c o n t r i b u t e d an d t h e n e t O P E B o b l i g a t i o n a r e a s f o l l o w s : Percentage Fi s c a l o f O P E B Ye a r C o s t C o n t r i b u t e d 20 1 1 $ 4 , 1 4 5 $ 1 , 8 1 4 4 3 . 7 6 % $ 7 , 0 0 7 20 1 2 4 , 2 6 0 1 , 8 1 4 4 2 . 5 8 % 9 , 4 5 3 20 1 3 3 6 , 5 2 0 3 8 , 0 4 6 1 0 4 . 1 8 % 7 , 9 2 7 Ac t u a l Net Co s t OP E B An n u a l Co n t r i b u t i o n s O b l i g a t i o n OPEB Fu n d e d S t a t u s a n d F u n d i n g P r o g r e s s Ac t u a r i a l v a l u a t i o n s o f a n o n g o i n g p l a n i n v o l v e e s t i m a t e s o f t h e v a l u e o f r e p o r t e d a m o u n t s a n d as s u m p t i o n s a b o u t t h e p r o b a b i l i t y o f o c c u r r e n c e o f e v e n t s f a r i n t o t h e f u t u r e . E x a m p l e s i n c l u d e as s u m p t i o n s a b o u t f u t u r e e m p l o y m e n t , m o r t a l i t y , a n d t h e h e a l t h c a r e c o s t c o n t r i b u t i o n s o f t h e e m p l o y e r ar e s u b j e c t t o c o n t i n u a l r e v i s i o n a s a c t u a l r e s u l t s a r e c o m p a r e d w i t h p a s t e x p e c t a t i o n s a n d n e w es t i m a t e s a r e m a d e a b o u t t h e f u t u r e . T h e s c h e d u l e o f f u n d i n g p r o g r e s s , p r e s e n t e d a s r e q u i r e d su p p l e m e n t a r y i n f o r m a t i o n f o l l o w i n g t h e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s , p r e s e n t s m u l t i y e a r t r e n d in f o r m a t i o n t h a t s h o w s w h e t h e r t h e a c t u a r i a l v a l u e o f p l a n a s s e t s i s i n c r e a s i n g o r d e c r e a s i n g o v e r t i m e re l a t i v e t o t h e a c t u a r i a l a c c r u e d l i a b i l i t i e s f o r b e n e f i t s . 125 UNITED CITY OF YORKVILLE, ILLINOIS Notes to the Financial Statements April 30, 2013 NOTE 4 –OTHER INFORMATION –Continued OTHER POST-EMPLOYMENT BENEFITS –Continued Funded Status and Funding Progress –Continued The funded status of the plan as of April 30, 2012,the date of the latest actuarial valuation, was as follows: Actuarial Accrued Liability (AAL)$566,488 Actuarial Value of Plan Assets - Unfunded Actuarial Accrued Liability (UAAL)566,488 Funded Ratio (Actuarial Value of Plan Assets/AAL)0.00% Covered Payroll (Active Plan Members)4,553,600 UAAL as a Percentage of Covered Payroll 12.44% Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuationand the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. In the April 30, 2012actuarial valuation the entry age actuarial cost method was used. The actuarial assumptions included a 5.0% investment rate of return (net of administrative expenses)and an annual healthcare cost trend rate of 8.0%, with an ultimate rate of 6.0%. Both rates include a 3.0% inflation assumption. The actuarial value of assets was not determined as the Cityhas not advance funded its obligation. The plan’s unfunded actuarial accrued liability is being amortized as a level percentage of projected payroll on an open basis. The remaining amortization period at April 30, 2013, was 30years. SUBSEQUENT EVENT OnMay 9, 2013, the City issued $6,625,000 of General Obligation Library Refunding Bonds of 2013. The bonds bear interest at a rate of 2.00% to 4.00% and are due in annual installments of $155,000 to $730,000 through December 30, 2024. In December of 2012, the City did not extend the Recreation Center lease for an additional five year period.As a result, the City ceased all Recreation Center activities as of June 30, 2013.The Recreation Center Fund will be closed out by an interfund transfer from the Parks and Recreation Fund in the subsequent fiscal year. 126 APPENDIX B DESCRIBING BOOK-ENTRY-ONLY ISSUANCE 1.The Depository Trust Company (“DTC”), New York, New York, will act as securities depository for the Bonds (the “Securities”). The Securities will be issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC. 2.DTC, the world’s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has Standard & Poor’s rating: AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com. 3.Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC’s records. The ownership interest of each actual purchaser of each Security (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book-entry system for the Securities is discontinued. 4.To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Securities are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. 127 5.Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them. 6.Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. 7.Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the City as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). 8.Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the City or the Paying Agent, on payable date in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participant and not of DTC, the Paying Agent, or the City, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the City or the Paying Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. 9.A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through its Participant, to any Tender/Remarketing Agent, and shall effect delivery of such Securities by causing the Direct Participant to transfer the Participant’s interest in the Securities, on DTC’s records, to any Tender/Remarketing Agent. The requirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC’s records and followed by a book-entry credit of tendered Securities to any Tender/Remarketing Agent’s DTC account. 10.DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to the City or the Paying Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered. 11.The City may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC. 12.The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that the City believes to be reliable, but the City takes no responsibility for the accuracy thereof. 128 January 6, 2014 Bernardi Securities, Inc. Chicago, Illinois Re: United City of Yorkville, Kendall County, Illinois General Obligation (Alternate Revenue Source) Refunding Bonds, Series 2014 Total Issue: $1,235,000 Original Date: January 6, 2014 Ladies and Gentlemen: We have acted as bond counsel in connection with the issuance by the United City of Yorkville, Kendall County, Illinois (the “Issuer”), of $1,235,000 of its General Obligation (Alternate Revenue Source) Refunding Bonds, Series 2014, originally dated January 6, 2014 (the “Bonds”). We have examined the law and the certified transcript of proceedings of the Issuer relative to the authorization, issuance and sale of the Bonds and such other papers as we deem necessary to render this opinion. We have relied upon the certified transcript of proceedings and other certificates of public officials, including the Issuer's tax covenants and representations (the “Tax Representations”), and we have not undertaken to verify any facts by independent investigation. We have relied upon the legal opinion of Kathleen Field Orr and Associates, counsel to the Issuer, dated the date hereof, as to the matters stated therein. We have also relied upon a report of Stanley P. Stone & Associates, Inc., Financing Consultants, New York, New York, as to the accuracy of the mathematical computations of the yield on the Bonds and the yield on the direct obligations of the United States of America deposited on the date hereof with The Bank of New York Mellon Trust Company, N.A., Chicago, Illinois, as escrow trustee (the “Escrow Trustee”), pursuant to the Escrow and Defeasance Agreement dated as of the date hereof between the Issuer and the Escrow Trustee. Based upon our examination, we are of the opinion, as of the date hereof, as follows: 1. The Bonds are valid and binding general obligations of the Issuer. 2. The Bonds are payable from (i) the sales taxes received by the Issuer pursuant to the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailer’s Occupation Tax Act (the “Sales Taxes”); (ii) certain incremental property taxes to be derived from the US Route 34 & IL Route 47 (Countryside Shopping Center) Tax Increment Financing Redevelopment Project Area within the Issuer and received by the Issuer (the “TIF Revenue” and together with the Sales Taxes, the “Pledged Revenues”); and (iii) ad valorem taxes levied against all taxable property in the territory of the Issuer without limitation as to rate or amount. The Bonds are payable from the Pledged Revenues on a parity with the outstanding General Obligation Bonds (Alternate Revenue Source), Series 2005. The Issuer is required annually to levy and appropriate an amount sufficient to pay the principal and interest coming due on the 129 Bonds to the extent the Pledged Revenues are not sufficient to pay the principal and interest coming due on the Bonds. 3. Under federal statutes, decisions, regulations and rulings existing on this date, interest on the Bonds is excludable from gross income for purposes of federal income taxation pursuant to Section 103 of the Internal Revenue Code of 1986 (the “Code”), is not a specific preference item for purposes of the alternative minimum tax imposed on corporations or other taxpayers, including individuals, but will be taken into account in determining adjusted current earnings for purposes of computing the alternative minimum tax imposed on certain corporations. This opinion is conditioned on continuing compliance with the Tax Representations. Failure to comply with the Tax Representations could cause interest on the Bonds to lose the exclusion from gross income for federal income tax purposes retroactive to their date of issue. We have not been engaged nor have we undertaken to review the accuracy, completeness or sufficiency of the Official Statement or any other offering material relating to the Bonds, and we express no opinion thereon. It is to be understood that the rights of the owner of the Bonds, and the enforceability thereof, may be subject to (i) bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights heretofore or hereafter enacted and that their enforcement may be subject to the exercise of judicial discretion in accordance with general principles of equity, and (ii) the valid exercise of the constitutional powers of the Issuer, the State of Illinois and the United States of America. Very truly yours, 130 APPENDIX D UNITED CITY OF YORKVILLE KENDALL COUNTY, ILLINOIS EXCERPTS OF FISCAL YEAR 2013 AUDITED FINANCIAL STATEMENTS RELATING TO THE CITY’S PENSION PLANS AND OTHER POSTEMPLOYMENT BENEFITS 131 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S Th e C i t y c o n t r i b u t e s t o t w o d e f i n e d b e n e f i t p e n s i o n p l a n s , t h e I l l i n o i s M u n i c i p a l R e t i r e m e n t F u n d , a de f i n e d b e n e f i t a g e n t m u l t i p l e - e m p l o y e r p u b l i c e m p l o y e e r e t i r e m e n t s y s t e m a n d t h e P o l i c e P e n s i o n Pl a n w h i c h i s a s i n g l e - e m p l o y e r p e n s i o n p l a n . A s e p a ra t e r e p o r t i s i s s u e d f o r t h e P o l i c e P e n s i o n P l a n an d m a y b e o b t a i n e d b y w r i t i n g t o t h e C i t y a t 8 0 0 G a m e F a r m R o a d , Y o r k v i l l e , I l l i n o i s 6 0 5 6 0 . I M R F do e s i s s u e a p u b l i c l y a v a i l a b l e f i na n c i a l r e p o r t t h a t i n c l u d e s f i n a n c i a l s t a t e m e n t s a n d r e q u i r e d su p p l e m e n t a r y i n f o r m a t i o n f o r t h e p l a n a s a w h o l e , b u t n o t b y i n d i v i d u a l e m p l o y e r . T h a t r e p o r t m a y b e ob t a i n e d o n - l i n e a t ww w . i m r f . o r g . T h e b e n e f i t , b e n e f i t l e v e l s , e m p l o y e e c o n t r i b u t i o n s , a n d e m p l o y e r co n t r i b u t i o n s a r e g o v e r n e d b y I l l i n o i s C o m p i l e d S t a t u t e s a n d c a n o n l y b e a m e n d e d b y t h e I l l i n o i s Ge n e r a l A s s e m b l y . Pl a n D e s c r i p t i o n s , P r o v i s i o n s a n d F u n d i n g P o l i c i e s Il l i n o i s M u n i c i p a l R e t i r e m e n t S y s t e m ( I M R F ) Al l e m p l o y e e s ( o t h e r t h a n t h o s e c o v e r e d b y t h e P o l i c e P e n s i o n p l a n ) h i r e d i n p o s i t i o n s t h a t m e e t o r ex c e e d t h e p r e s c r i b e d a n n u a l h o u r l y s t a n d a r d m u s t b e e n r o l l e d i n I M R F a s p a r t i c i p a t i n g m e m b e r s . Pa r t i c i p a t i n g m e m b er s h i r e d b e f o r e J a n u a r y 1 , 2 0 1 1 w h o r e t i r e a t o r a f t e r a g e 6 0 w i t h 8 y e a r s o f s e r v i c e ar e e n t i t l e d t o a n a n n u a l r e t i r e m e n t b e n e f i t , p a y a b l e m o n t h l y f o r l i f e , i n a n a m o u n t e q u a l t o 1 - 2 / 3 pe r c e n t o f t h e i r f i n a l r a t e ( a v e r a g e o f t h e h i g h e s t 4 8 c o n s e c u t i v e m o n t h s ' e a r n i n g s d u r i n g t h e l a s t 1 0 ye a r s ) o f e a r n i n g s , f o r e a c h y e a r o f c r e d i t e d s e r v i c e u p t o 1 5 y e a r s , a n d 2 p e r c e n t f o r e a c h y e a r th e r e a f t e r . T h e m o n t h l y p e n s i o n o f a m e m b e r h i r e d b e f o r e J a n u a r y 1 , 2 0 1 1 , s h a l l b e i n c r e a s e d a n n u a l l y by 3 % o f t h e o r i g i n a l p e n s i o n . E m p l o y e e s w i t h a t l e a s t 8 y e a r s o f c r e d i t e d s e r v i c e m a y r e t i r e a t o r a f t e r ag e 5 5 a n d r e c e i v e a r e d u c e d b e n e f i t . Fo r p a r t i c i p a t i n g m e m b e r s h i r e d o n o r a f t e r J a n u a r y 1 , 2 0 1 1 w h o r e t i r e a t o r a f t e r a g e 6 7 w i t h 1 0 y e a r s of s e r v i c e a r e e n t i t l e d t o a n a n n u a l r e t i r e m e n t b e n e f i t , p a y a b l e m o n t h l y f o r l i f e i n a n a m o u n t e q u a l t o 1 - 2/ 3 p e r c e n t o f t h e i r f i n a l r a t e ( a v e r a g e o f t h e h i g h e s t 9 6 c o n s e c u t i v e m o n t h s ’ e a r n i n g s d u r i n g t h e l a s t 1 0 ye a r s ) o f e a r n i n g s , f o r e a c h y e a r o f c r e d i t e d s e r v i c e , w i t h a m a x i m u m s a l a r y c a p o f $ 1 0 6 , 8 0 0 a t J a n u a r y 1, 2 0 1 1 . T h e m a x i m u m s a l a r y c a p i n c r e a s e s e a c h y e a r t h e r e a f t e r . T h e m o n t h l y p e n s i o n o f a m e m b e r hi r e d o n o r a f t e r J a n u a r y 1 , 2 0 1 1 , s h a l l b e i n c r e a s e d a n n u a l l y , f o l l o w i n g t h e l a t e r o f t h e f i r s t a n n i v e r s a r y da t e o f r e t i r e m e n t o r t h e m o n t h f o l l o w i n g t h e a t t a i n m e n t o f a g e 6 2 , b y t h e l e s s e r o f 3 % o r ½ o f t h e co n s u m e r p r i c e i n d e x . E m p l o y e e s w i t h a t l e a s t 1 0 y e ar s o f c r e d i t e d s e r v i c e m a y r e t i r e a t o r a f t e r a g e 6 2 an d r e c e i v e a r e d u c e d b e n e f i t . IM R F a l s o p r o v i d e s d e a t h a n d d i s a b i l i t y b e n e f i t s . T h e s e b e n e f i t p r o v i si o n s a n d a l l o t h e r r e q u i r e m e n t s ar e e s t a b l i s h e d b y s t a t e s t a t u t e . E m p l o y e e s p a r t i c i p a t i n g i n t h e p l a n a r e r e q u i r e d t o c o n t r i b u t e 4 . 5 0 pe r c e n t o f t h e i r a n n u a l c o v e r e d s a l a r y t o I M R F . T h e e m p l o y e e s ’ c o n t r i b u t i o n r a t e i s e s t a b l i s h e d b y s t a t e st a t u t e . T h e C i t y i s r e q u i r e d t o c o n t r i b u t e t h e r e m a i n i n g a m o u n t n e c e s s a r y t o f u n d t h e I M R F p l a n a s sp e c i f i e d b y s t a t u t e . F o r t h e c a l e n d a r y e a r 2 0 1 2 t h e e m p l o y e r a n n u a l r e q u i r e d c o n t r i b u t i o n r a t e w a s 9 . 6 4 pe r c e n t . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S – Continued Pl a n D e s c r i p t i o n s , P r o v i s i o n s a n d F u n d i n g P o l i c i e s – C o n t i n u e d Po l i c e P e n s i o n P l a n Th e P o l i c e P e n s i o n P l a n i s a s i n g l e - e m p l o y e r d e f i n e d b e n e f i t p e n s i o n p l a n t h a t c o v e r s a l l s w o r n p o l i c e pe r s o n n e l . A l t h o u g h t h i s i s a s i n g l e - e m p l o y e r p e n s i o n p l a n , t h e d e f i n e d b e n e f i t s a n d e m p l o y e e a n d em p l o y e r c o n t r i b u t i o n l e v e l s a r e g o v e r n e d b y I l l i n o i s S t a t e S t a t u t e s a n d m a y b e a m e n d e d o n l y b y t h e Il l i n o i s l e g i s l a t u r e . T h e C i t y a c c o u n t s f o r t h e p l a n a s a p e n s i o n t r u s t f u n d . At A p r i l 3 0 , 2 0 1 2 , t h e d a t e o f t h e m o s t r e c e n t a c t u a r i a l v a l u a t i o n , t h e P o l i c e P e n s i o n P l a n m e m b e r s h i p co n s i s t e d o f : Re t i r e e s a n d B e n e f i c i a r i e s C u r r e n t l y R e c e i v i n g Be n e f i t s a n d T e r m i n a t e d E m p l o y e e s E n t i t l e d to B e n e f i t s b u t n o t y e t R e c e i v i n g T h e m 6 Cu r r e n t E m p l o y e e s Ve s t e d 13 No n v e s t e d 12 31 Th e f o l l o w i n g i s a s u m m a r y o f t h e P o l i c e P e n s i o n P l a n a s p r o v i d e d f o r i n I l l i n o i s S t a t e S t a t u t e s . Th e P o l i c e P e n s i o n P l a n p r o v i d e s r e ti r e m e n t b e n e f i t s a s w e l l a s d e a t h and disability benefits. Covered em p l o y e e s h i r e d b e f o r e J a n u a r y 1 , 2 0 1 1 , a t t a i n i n g t h e a g e o f 5 0 o r m o r e w i t h 2 0 o r m o r e y e a r s o f cr e d i t a b l e s e r v i c e a r e e n t i t l e d t o r e c e i v e a n a n n u a l r e t i r e m e n t b e n e f i t o f ½ o f t h e s a l a r y a t t a c h e d t o t h e ra n k h e l d o n t h e l a s t d a y o f s e r v i c e , o r f o r o n e y e a r p r i o r t o t h e l a s t d a y , w h i c h e v e r i s g r e a t e r . T h e pe n s i o n s h a l l b e i n c r e a s e d b y 2 . 5 % o f s u c h s a l a r y f o r e a c h a d d i t i o n a l y e a r o f s e r v i c e o v e r 2 0 y e a r s u p t o 30 y e a r s , t o a m a x i m u m o f 7 5 % o f s u c h s a l a r y . C o v e r e d e m p l o y e e s h i r e d o n o r a f t e r J a n u a r y 1 , 2 0 1 1 , at t a i n i n g t h e a g e o f 5 5 w i t h a t l e a s t 1 0 y e a r s c r e d i t a b l e s e r v i c e a r e e n t i t l e d t o r e c e i v e a n a n n u a l re t i r e m e n t b e n e f i t o f 2 . 5 % o f f i n a l a v e r a g e s a l a r y f o r e a c h y e a r o f s e r v i c e , w i t h a m a x i m u m s a l a r y c a p of $ 1 0 6 , 8 0 0 a s o f J a n u a r y 1 , 2 0 1 1 . T h e m a x i m u m s a l a r y c a p i n c r e a s e s e a c h y e a r t h e r e a f t e r . T h e mo n t h l y b e n e f i t o f a p o l i c e o f f i c e r h i r e d b e f o r e J a n u a r y 1 , 2 0 1 1 , w h o r e t i r e d w i t h 2 0 o r m o r e y e a r s o f se r v i c e a f t e r J a n u a r y 1 , 1 9 7 7 s h a l l b e i n c r e a s e d a n n u a l l y , f o l l o w i n g t h e f i r s t a n n i v e r s a r y d a t e o f re t i r e m e n t a n d b e p a i d u p o n r e a c h i n g t h e a g e o f a t l e a s t 5 5 y e a r s , b y 3 % o f t h e o r i g i n a l p e n s i o n a n d 3 % co m p o u n d e d a n n u a l l y t h e r e a f t e r . T h e m o n t h l y p e n s i o n o f a p o l i c e o f f i c e r h i r e d o n o r a f t e r J a n u a r y 1 , 20 1 1 , s h a l l b e i n c r e a s e d a n n u a l l y , f o l l o w i n g t h e l a t e r o f t h e f i r s t a n n i v e r s a r y d a t e o f r e t i r e m e n t o r t h e mo n t h f o l l o w i n g t h e a t t a i n m e n t o f a g e 6 0 , b u t t h e l e s s e r o f 3 % o r ½ o f t h e c o n s u m e r p r i c e i n d e x . Em p l o y e e s w i t h a t l e a s t 1 0 y e a r s b u t l e s s t h a n 2 0 ye a r s o f c r e d i t a b l e s e r v i c e m a y r e t i r e a t o r a f t e r a g e 60 a n d r e c e i v e a r e d u c e d b e n e f i t . 132 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – C o n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S – C o n t i n u e d Pl a n D e s c r i p t i o n s , P r o v i s i o n s , a n d F u n d i n g P o l i c i e s – C o n t i n u e d Po l i c e P e n s i o n P l a n – C o n t i n u e d Co v e r e d e m p l o y e e s a r e r e q u i r e d t o c o n t r i b u t e 9 . 9 1 % o f t h e i r b a s e s a l a r y t o t h e P o l i c e P e n s i o n P l a n . I f a n em p l o y e e l e a v e s c o v e r e d e m p l o y m e n t w i t h l e s s t h a n 2 0 y e a r s o f s e r v i c e , a c c u m u l a t e d e m p l o y e e co n t r i b u t i o n s m a y b e r e f u n d e d w i t h o u t a c c u m u l a t e d i n t e r e s t . T h e C i t y i s r e q u i r e d t o c o n t r i b u t e t h e re m a i n i n g a m o u n t s n e c e s s a r y t o f i n a n c e t h e p l a n , i n c l u d i n g a d m i n i s t r a t i v e c o s t s , a s a c t u a r i a l l y d e t e r m i n e d by a n e n r o l l e d a c t u a r y . B y t h e y e a r 2 0 4 0 t h e C i t y ' s c o n t r i b u t i o n s m u s t a c c u m u l a t e t o t h e p o i n t w h e r e t h e pa s t s e r v i c e c o s t f o r t h e P o l i c e P e n s i o n P l a n i s 9 0 % f u n d e d . Su m m a r y o f S i g n i f i c a n t A c c o u n t i n g P o l i c i e s a n d P l a n A s s e t M a t t e r s Ba s i s o f A c c o u n t i n g Th e f i n a n c i a l s t a t e m e n t s a r e p r e p a r e d u s i n g t h e a c c r u a l b a s i s o f a c c o u n t i n g . E m p l o y e e a n d e m p l o y e r co n t r i b u t i o n s a r e r e c o g n i z e d a s r e v e n u e s w h e n du e , p u r s u a n t t o f o r m a l c o m m i t m e n t s , a s w e l l a s st a t u t o r y o r c o n t r a c t u a l r e q u i r e m e n t s . B e n e f i t s a n d r e f u n d s a r e r e c o g n i z e d w h e n d u e a n d p a y a b l e i n ac c o r d a n c e w i t h t h e t e r m s o f t h e p l a n . Me t h o d U s e d t o V a l u e I n v e s t m e n t s In v e s t m e n t s a r e r e p o r t e d a t f a i r v a l u e . S h o r t - t e r m i n v e s t m e n t s a r e r e p o r t e d a t c o s t , w h i c h a p p r o x i m a t e s fa i r v a l u e . S e c u r i t i e s t r a d e d o n n a t i o n a l e x c h a n g e s a r e v a l u e d a t t h e l a s t r e p o r t e d s a l e s p r i c e . I n v e s t m e n t s th a t d o n o t h a v e a n y e s t a b l i s h e d m a r k e t , i f a n y , a r e r e p o r t e d a t e s t i m a t e d f a i r v a l u e . Si g n i f i c a n t I n v e s t m e n t s At y e a r - e n d , t h e P o l i c e P e n s i o n F u n d h a s o v e r 5 p e r c e n t o f n e t p o s i t i o n a v a i l a b l e f o r r e t i r e m e n t b e n e f i t s (o t h e r t h a n U . S . G o v e r n m e n t g u a r a n t e e d o b l i g a t i o n s ) i n v e s t e d i n S c h w a b S & P 5 0 0 I n d e x F u n d ($ 5 9 0 , 5 4 1 ) . I n f o r m a t i o n f o r I M R F i s n o t a v a i l a b l e . Re l a t e d P a r t y T r a n s a c t i o n s Th e r e a r e n o s e c u r i t i e s o f t h e e m p l o y e r o r a n y o t h e r r e l a t e d p a r t i e s i n c l u d e d i n n e t p o s i t i o n . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – C o n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S –Continued An n u a l P e n s i o n C o s t a n d N e t P e n s i o n O b l i g a t i o n Th e p e n s i o n l i a b i l i t y f o r I M R F a n d t h e P o l i c e P e n s i o n P l a n i s a s f o l l o w s : Police PensionTotals An n u a l R e q u i r e d C o n t r i b u t i o n $ 2 4 2 , 7 7 4 5 4 2 , 6 4 8 7 8 5 , 4 2 2 In t e r e s t o n N e t P e n s i o n O b l i g a t i o n 1 , 1 9 0 4 2 , 3 6 9 4 3 , 5 5 9 Ad j u s t m e n t t o A n n u a l R e q u i r e d C o n t r i b u t i o n 7 , 6 4 4 ( 4 1 , 3 3 1 ) ( 3 3 , 6 8 7 ) An n u a l P e n s i o n C o s t 2 5 1 , 6 0 8 5 4 3 , 6 8 6 7 9 5 , 2 9 4 Ac t u a l C o n t r i b u t i o n 2 6 7 , 4 7 1 4 3 8 , 7 1 1 7 0 6 , 1 8 2 Ch a n g e i n N P O ( 1 5 , 8 6 3 ) 1 0 4 , 9 7 5 8 9 , 1 1 2 NP O - B e g i n n i n g o f Y e a r 1 5 , 8 6 3 5 4 8 , 4 4 8 5 6 4 , 3 1 1 NP O - E n d o f Y e a r - 6 5 3 , 4 2 3 6 5 3 , 4 2 3 IM R F 133 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S – C o n t i n u e d An n u a l P e n s i o n C o s t a n d N e t P e n s i o n O b l i g a t i o n – C o n t i n u e d Th e C i t y ’ s a n n u a l p e n s i o n c o s t f o r t h e c u r r e n t y e a r a n d r e l a t e d i n f o r m a t i o n f o r e a c h p l a n i s a s f o l l o w s : Po l i c e IM R F P e n s i o n Co n t r i b u t i o n R a t e s Em p l o y e r 9 . 6 4 % 2 0 . 2 3 % Em p l o y e e 4 . 5 0 % 9 . 9 1 % Ac t u a r i a l V a l u a t i o n D a t e 1 2 / 3 1 / 2 0 1 2 4 / 3 0 / 2 0 1 2 Ac t u a r i a l C o s t M e t h o d E n t r y A g e E n t r y A g e No r m a l N o r m a l Am o r t i z a t i o n M e t h o d L e v e l % o f L e v e l % o f Pr o j e c t e d P a y r o l l P r o j e c t e d P a y r o l l Op e n B a s i s C l o s e d B a s i s Re m a i n i n g A m o r t i z a t i o n P e r i o d 3 0 Y e a r s 2 9 Y e a r s As s e t V a l u a t i o n M e t h o d 5 - Y e a r M a r k e t Sm o o t h e d M a r k e t Ac t u a r i a l A s s u m p t i o n s In v e s t m e n t R a t e o f R e t u r n 7 . 5 0 % 7 . 5 0 % Co m p o u n d e d C o m p o u n d e d An n u a l l y A n n u a l l y Pr o j e c t e d S a l a r y I n c r e a s e s . 4 t o 1 0 . 0 % 5 . 5 0 % In f l a t i o n R a t e I n c l u d e d 4 . 0 0 % 3 . 0 0 % Co s t - o f - L i v i n g A d j u s t m e n t s 3 . 0 0 % 3 . 0 0 % UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S –Continued Tr e n d I n f o r m a t i o n Em p l o y e r a n n u a l p e n s i o n c o s t ( A P C ) , a c t u a l c o n t r i b u t i o n s a n d t h e n e t p e n s i o n o b l i g a t i o n ( N P O ) a r e a s fo l l o w s . T h e N P O i s t h e c u m u l a t i v e d i f f e r e n c e b e t w e e n t h e A P C a n d t h e c o n t r i b u t i o n s a c t u a l l y m a d e . Fi s c a l Ye a r An n u a l P e n s i o n C o s t 2 0 1 1 $ 3 1 0 , 9 3 3 $ 4 8 9 , 5 2 3 (A P C ) 2 0 1 2 2 5 3 , 6 3 6 5 1 0 , 4 7 9 20 1 3 2 5 1 , 6 0 8 5 4 3 , 6 8 6 Ac t u a l C o n t r i b u t i o n s 2 0 1 1 2 9 5 , 4 0 2 3 3 6 , 0 7 5 20 1 2 2 5 3 , 3 0 4 3 6 0 , 3 5 6 20 1 3 2 6 7 , 4 7 1 4 3 8 , 7 1 1 Pe r c e n t a g e o f A P C 2 0 1 1 1 0 0 . 0 0 % 6 8 . 6 5 % Co n t r i b u t e d 2 0 1 2 9 9 . 8 7 % 7 0 . 5 9 % 20 1 3 1 0 6 . 3 0 % 8 0 . 6 9 % Ne t P e n s i o n O b l i g a t i o n 2 0 1 1 1 5 , 5 3 1 3 9 8 , 3 2 5 20 1 2 1 5 , 8 6 3 5 4 8 , 4 4 8 20 1 3 -653,423IMRFPensionPolice 134 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d EM P L O Y E E R E T I R E M E N T S Y S T E M – D E F I N E D B E N E F I T P E N S I O N P L A N S – C o n t i n u e d Fu n d e d S t a t u s a n d F u n d i n g P r o g r e s s Th e C i t y ’ s f u n d e d s t a t u s f o r t h e c u r r e n t y e a r a n d re l a t e d i n f o r m a t i o n f o r e a c h p l a n i s a s f o l l o w s : Po l i c e IM R F P e n s i o n Ac t u a r i a l V a l u a t i o n D a t e 1 2 / 3 1 / 2 0 1 2 4 / 3 0 / 2 0 1 2 Pe r c e n t F u n d e d 8 0 . 3 3 % 4 2 . 8 0 % Ac c u a r i a l A c c r u e d L i a b i l i t y fo r B e n e f i t s $ 5 , 2 4 7 , 5 6 2 $ 1 0 , 4 6 3 , 7 3 7 Ac t u a r i a l V a l u e o f A s s e t s $ 4 , 2 1 5 , 1 1 3 $ 4 , 4 8 1 , 6 0 1 Ov e r ( U n d e r ) F u n d e d A c t u a r i a l Ac c r u e d L i a b i l i t y ( U A A L ) ( $ 1 , 0 3 2 , 4 4 9 ) ( $ 5 , 9 8 2 , 1 3 6 ) Co v e r e d P a y r o l l ( A n n u a l P a y r o l l of A c t i v e E m p l o y e e s C o v e r e d by t h e P l a n ) $ 2 , 5 1 8 , 4 0 4 $ 1 , 6 9 4 , 4 4 5 Ra t i o o f U A A L t o C o v e r e d Pa y r o l l 4 1 . 0 0 % 3 5 3 . 0 4 % Th e s c h e d u l e o f f u n d i n g p r o g r e s s , p r e s e n t e d a s R e q u i r e d S u p p l e m e n t a r y I n f o r m a t i o n ( R S I ) f o l l o w i n g th e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s , p r e s e n t s m u l t i y e a r t r e n d i n f o r m a t i o n a b o u t w h e t h e r t h e a c t u a r i a l va l u e o f p l a n a s s e t s a r e i n c r e a s i n g o r d e c r e a s i n g o v e r t i m e r e l a t i v e t o t h e a c t u a r i a l a c c r u e d l i a b i l i t y f o r be n e f i t s . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d OT H E R P O S T - E M P L O Y M E N T B E N E F I T S Pl a n D e s c r i p t i o n s , P r o v i s i o n s , a n d F u n d i n g P o l i c i e s In a d d i t i o n t o p r o v i d i n g t h e p e n s i o n b e n e f i t s d e s c r i b e d , t h e C i t y o f f e r s p o s t - e m p l o y m e n t h e a l t h c a r e in s u r a n c e b e n e f i t s ( O P E B ) f o r i t s e l i g i b l e r e t i r e d e m p l o y e e s t h r o u g h a s i n g l e e m p l o y e r d e f i n e d b e n e f i t pl a n . T h e b e n e f i t s , b e n e f i t l e v e l s , e m p l o y e e c o n t r i b u t i o n s a n d e m p l o y e r c o n t r i b u t i o n s a r e g o v e r n e d b y th e C i t y a n d c a n b e a m e n d e d b y t h e C i t y t h r o u g h i t s p e r s o n n e l m a n u a l a n d u n i o n c o n t r a c t s . T h e p l a n i s no t a c c o u n t e d f o r a s a t r u s t f u n d , a s a n i r r e v o c a b l e t r u s t h a s n o t b e e n e s t a b l i s h e d t o a c c o u n t f o r t h e p l a n . Th e p l a n d o e s n o t i s s u e a s e p a r a t e r e p o r t . T h e a c t i v i t y o f t h e p l a n i s r e p o r t e d i n t h e C i t y ’ s G e n e r a l Fu n d . Th e C i t y o f f e r s p o s t - e m p l o y m e n t h e a l t h c a r e b e n e f i t s t o its retirees. To be eligible for benefits, an em p l o y e e m u s t q u a l i f y f o r r e t i r e m e n t u n d e r o n e o f t h e C i t y ’ s r e t i r e m e n t p l a n s . C u r r e n t e l e c t e d o f f i c i a l s ar e e l i g i b l e i f t h e y w e r e e l e c t e d / a p p o i n t e d p r i o r t o A p r i l , 2 0 1 3 . Al l h e a l t h c a r e b e n e f i t s a r e p r o v i d e d t h r o u g h t h e C i t y ’ s he a l t h i n s u r a n c e p l a n . T h e benefit levels are the sa m e a s t h o s e a f f o r d e d t o a c t i v e e m p l o y e e s . B e n e f it s i n c l u d e g e n e r a l i n p a t i e n t a n d o u t p a t i e n t m e d i c a l se r v i c e s ; m e n t a l , n e r v o u s , a n d s u b s t a n c e a b u s e c a r e ; v i s i o n c a r e ; d e n t a l c a r e ; a n d p r e s c r i p t i o n s . U p o n a re t i r e e r e a c h i n g 6 5 y e a r s o f a g e , M e d i c a r e b e c o m e s t h e p r i m a r y i n s u r e r a n d t h e C i t y ’ s p l a n b e c o m e s se c o n d a r y . Al l r e t i r e e s c o n t r i b u t e 1 0 0 % o f t h e a c t u a r i a l l y d e t e r m i n e d p r e m i u m t o t h e p l a n , w i t h t h e e x c e p t i o n o f tw o p r e v i o u s e m p l o y e e s f o r w h i c h t h e C i t y h a s a g r e e d t o p a y p o r t i o n s o f t h e i r p o s t - e m p l o y m e n t h e a l t h , de n t a l a n d v i s i o n i n s u r a n c e . F o r t h e f i s c a l y e a r e n d i n g A p r i l 3 0 , 2 0 1 3 , r e t i r e e s c o n t r i b u t e d $ 5 7 , 8 2 4 t o th e p l a n . A c t i v e e m p l o y e e s d o n o t c o n t r i b u t e t o t h e po s t - e m p l o y m e n t h e a l t h c a r e p l a n u n t i l r e t i r e m e n t . At A p r i l 3 0 , 2 0 1 3 , m e m b e r s h i p c o n s i s t e d o f : Re t i r e e s a n d B e n e f i c i a r i e s C u r r e n t l y R e c e i v i n g Be n e f i t s a n d T e r m i n a t e d E m p l o y e e s E n t i t l e d to B e n e f i t s b u t n o t y e t R e c e i v i n g T h e m 8 Ac t i v e E m p l o y e e s 7 8 To t a l 8 6 Pa r t i c i p a t i n g E m p l o y e r s 1 Th e C i t y d o e s n o t c u r r e n t l y h a v e a f u n d i n g p o l i c y . 135 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d OT H E R P O S T - E M P L O Y M E N T B E N E F I T S – C o n t i n u e d An n u a l O P E B C o s t s a n d N e t O P E B O b l i g a t i o n Th e n e t O P E B o b l i g a t i o n ( N O P E B O ) a s o f A p r i l 3 0 , 2 0 1 3 , w a s c a l c u l a t e d a s f o l l o w s : An n u a l R e q u i r e d C o n t r i b u t i o n $ 3 6 , 3 6 3 In t e r e s t o n t h e N e t O P E B O b l i g a t i o n 47 3 Ad j u s t m e n t t o t h e A R C (3 1 6 ) An n u a l O P E B C o s t 36 , 5 2 0 Ac t u a l C o n t r i b u t i o n 38 , 0 4 6 In c r e a s e i n t h e n e t O P E B O b l i g a t i o n (1 , 5 2 6 ) Ne t O P E B O b l i g a t i o n - B e g i n n i n g o f Y e a r 9, 4 5 3 Ne t O P E B O b l i g a t i o n - E n d o f Y e a r 7, 9 2 7 Tr e n d I n f o r m a t i o n Th e C i t y ’ s a n n u a l O P E B c o s t , a c t u a l c o n t r i b u t i o n s , t h e p e r c e n t a g e o f a n n u a l O P E B c o s t c o n t r i b u t e d an d t h e n e t O P E B o b l i g a t i o n a r e a s f o l l o w s : Pe r c e n t a g e Fi s c a l o f O P E B Ye a r C o s t C o n t r i b u t e d 20 1 1 $ 4 , 1 4 5 $ 1 , 8 1 4 4 3 . 7 6 % $ 7 , 0 0 7 20 1 2 4 , 2 6 0 1 , 8 1 4 4 2 . 5 8 % 9 , 4 5 3 20 1 3 3 6 , 5 2 0 3 8 , 0 4 6 1 0 4 . 1 8 % 7 , 9 2 7 Ac t u a l Ne t Co s t OP E B An n u a l Co n t r i b u t i o n s O b l i g a t i o n OP E B Fu n d e d S t a t u s a n d F u n d i n g P r o g r e s s Ac t u a r i a l v a l u a t i o n s o f a n o n g o i n g p l a n i n v o l v e e s t i m a t e s o f t h e v a l u e o f r e p o r t e d a m o u n t s a n d as s u m p t i o n s a b o u t t h e p r o b a b i l i t y o f o c c u r r e n c e o f e v e n t s f a r i n t o t h e f u t u r e . E x a m p l e s i n c l u d e as s u m p t i o n s a b o u t f u t u r e e m p l o y m e n t , m o r t a l i t y , a n d t h e h e a l t h c a r e c o s t c o n t r i b u t i o n s o f t h e e m p l o y e r ar e s u b j e c t t o c o n t i n u a l r e v i s i o n a s a c t u a l r e s u l t s a r e c o m p a r e d w i t h p a s t e x p e c t a t i o n s a n d n e w es t i m a t e s a r e m a d e a b o u t t h e f u t u r e . T h e s c h e d u l e o f f u n d i n g p r o g r e s s , p r e s e n t e d a s r e q u i r e d su p p l e m e n t a r y i n f o r m a t i o n f o l l o w i n g t h e n o t e s t o t h e f i n a n c i a l s t a t e m e n t s , p r e s e n t s m u l t i y e a r t r e n d in f o r m a t i o n t h a t s h o w s w h e t h e r t h e a c tu a r i a l v a l u e o f p l a n a s s e t s i s in c r e a s i n g o r d e c r e a s i n g o v e r t i m e re l a t i v e t o t h e a c t u a r i a l a c c r u e d l i a b i l i t i e s f o r b e n e f i t s . UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S No t e s t o t h e F i n a n c i a l S t a t e m e n t s Ap r i l 3 0 , 2 0 1 3 NO T E 4 – O T H E R I N F O R M A T I O N – Co n t i n u e d OT H E R P O S T - E M P L O Y M E N T B E N E F I T S – C o n t i n u e d Fu n d e d S t a t u s a n d F u n d i n g P r o g r e s s – C o n t i n u e d Th e f u n d e d s t a t u s o f t h e p l a n a s o f A p r i l 3 0 , 2 0 1 2 , t h e d a t e o f t h e l a t e s t a c t u a r i a l v a l u a t i o n , w a s a s fo l l o w s : Ac t u a r i a l A c c r u e d L i a b i l i t y ( A A L ) $566,488 Ac t u a r i a l V a l u e o f P l a n A s s e t s - Un f u n d e d A c t u a r i a l A c c ru e d L i a b i l i t y ( U A A L ) 566,488 Fu n d e d R a t i o ( A c t u a r i a l V a l u e o f P l a n A s s e t s / A A L ) 0.00% Co v e r e d P a y r o l l ( A c t i v e P l a n M e m b e r s ) 4,553,600 UA A L a s a P e r c e n t a g e o f C o v e r e d P a y r o l l 12.44% Ac t u a r i a l M e t h o d s a n d A s s u m p t i o n s Pr o j e c t i o n s o f b e n e f i t s f o r f i n a n c i a l r e p o r t i n g p u r p o s e s a r e b a s e d o n t h e s u b s t a n t i v e p l a n ( t h e p l a n a s un d e r s t o o d b y t h e e m p l o y e r a n d p l a n m e m b e r s ) a n d i n c l u d e t h e t y p e s o f b e n e f i t s p r o v i d e d a t t h e t i m e o f ea c h v a l u a t i o n a n d t h e h i s t o r i c a l p a t t e r n o f s h a r i n g of b e n e f i t c o s t s b e t w e e n t h e e m p l o y e r a n d p l a n me m b e r s t o t h a t p o i n t . T h e a c t u a r i a l m e t h o d s a n d a s s u m p t i o n s u s e d i n c l u d e t e c h n i q u e s t h a t a r e de s i g n e d t o r e d u c e s h o r t - t e r m v o l a t i l i t y i n a c t u a r i a l a c c r u e d l i a b i l i t i e s a n d t h e a c t u a r i a l v a l u e o f a s s e t s , co n s i s t e n t w i t h t h e l o n g - t e r m p e r s p e c t i v e o f t h e c a l c u l a t i o n s . In t h e A p r i l 3 0 , 2 0 1 2 a c t u a r i a l v a l u a t i o n t h e e n t r y a g e a c t u a r i a l c o s t m e t h o d w a s u s e d . T h e a c t u a r i a l as s u m p t i o n s i n c l u d e d a 5 . 0 % i n v e s t m e n t r a t e o f r e t u r n ( n e t o f a d m i n i s t r a t i v e e x p e n s e s ) a n d a n a n n u a l he a l t h c a r e c o s t t r e n d r a t e o f 8 . 0 % , w i t h a n u l t i m a t e r a t e o f 6 . 0 % . B o t h r a t e s i n c l u d e a 3 . 0 % i n f l a t i o n as s u m p t i o n . T h e a c t u a r i a l v a l u e o f a s s e t s w a s n o t d e t e r m i n e d a s t h e C i t y h a s n o t a d v a n c e f u n d e d i t s ob l i g a t i o n . T h e p l a n ’ s u n f u n d e d a c t u a r i a l a c c r u e d l i a b i l i t y i s b e i n g a m o r t i z e d a s a l e v e l p e r c e n t a g e o f pr o j e c t e d p a y r o l l o n a n o p e n b a s i s . T h e r e m a i n i n g a m o r t i z a t i o n p e r i o d a t A p r i l 3 0 , 2 0 1 3 , w a s 3 0 y e a r s . SU B S E Q U E N T E V E N T On M a y 9 , 2 0 1 3 , t h e C i t y i s s u e d $ 6 , 6 2 5 , 0 0 0 o f G e n e r a l O b l i g a t i o n L i b r a r y R e f u n d i n g B o n d s o f 2 0 1 3 . Th e b o n d s b e a r i n t e r e s t a t a r a t e o f 2 . 0 0 % t o 4 . 0 0 % a n d a r e d u e i n a n n u a l i n s t a l l m e n t s o f $ 1 5 5 , 0 0 0 t o $7 3 0 , 0 0 0 t h r o u g h D e c e m b e r 3 0 , 2 0 2 4 . In D e c e m b e r o f 2 0 1 2 , t h e C i t y d i d n o t e x t e n d t h e R e c r e a t i o n C e n t e r l e a s e f o r a n a d d i t i o n a l f i v e y e a r pe r i o d . A s a r e s u l t , t h e C i t y c e a s e d a l l R e c r e a t i o n C e n t e r a c t i v i t i e s a s o f J u n e 3 0 , 2 0 1 3 . T h e R e c r e a t i o n Ce n t e r F u n d w i l l b e c l o s e d o u t b y a n i n t e r f u n d t r a n s f e r f r o m t h e P a r k s a n d R e c r e a t i o n F u n d i n t h e su b s e q u e n t f i s c a l y e a r . 136 UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S Il l i n o i s M u n i c i p a l R e t i r e m e n t F u n d Re q u i r e d S u p p l e m e n t a r y I n f o r m a t i o n Sc h e d u l e o f F u n d i n g P r o g r e s s a n d E m p l o y e r C o n t r i b u t i o n s Ap r i l 3 0 , 2 0 1 3 Fu n d i n g P r o g r e s s (6 ) Un f u n d e d (O v e r f u n d e d ) Ac t u a r i a l Ac c r u e d Li a b i l i t y a s a Ac t u a r i a l ( 3 ) P e r c e n t a g e Va l u a t i o n F u n d e d o f C o v e r e d Da t e R a t i o P a y r o l l De c . 3 1 , ( 1 ) ÷ ( 2 ) ( 4 ) ÷ ( 5 ) 20 0 7 $ 4 , 1 3 7 , 5 0 4 $ 4 , 1 0 4 , 2 4 3 1 0 0 . 8 1 % $ ( 3 3 , 2 6 1 ) $ 3 , 2 7 1 , 2 7 3 - 1 . 0 2 % 20 0 8 4 , 1 6 5 , 8 1 1 4 , 9 4 9 , 6 3 4 8 4 . 1 6 % 7 8 3 , 8 2 3 3 , 6 9 4 , 3 6 7 2 1 . 2 2 % 20 0 9 4 , 3 2 2 , 1 4 9 5 , 0 0 8 , 1 9 2 8 6 . 3 0 % 6 8 6 , 0 4 3 3 , 6 3 8 , 9 8 6 1 8 . 8 5 % 20 1 0 4 , 6 7 1 , 0 7 1 5 , 4 0 8 , 6 5 5 8 6 . 3 6 % 7 3 7 , 5 8 4 3 , 2 3 5 , 5 1 5 2 2 . 8 0 % 20 1 1 4 , 4 1 6 , 3 9 3 5 , 1 6 9 , 6 4 6 8 5 . 4 3 % 7 5 3 , 2 5 3 2 , 6 6 3 , 5 5 4 2 8 . 2 8 % 20 1 2 4 , 2 1 5 , 1 1 3 5 , 2 4 7 , 5 6 2 8 0 . 3 3 % 1 , 0 3 2 , 4 4 9 2 , 5 1 8 , 4 0 4 4 1 . 0 0 % Em p l o y e r C o n t r i b u t i o n s Fi s c a l Pe r c e n t Ye a r Co n t r i b u t e d 20 0 8 $ 2 4 8 , 9 4 4 $ 2 4 8 , 9 4 4 1 0 0 . 0 0 % 20 0 9 2 8 7 , 4 2 2 2 8 7 , 4 2 2 1 0 0 . 0 0 % 20 1 0 3 0 2 , 0 3 6 3 0 2 , 0 3 6 1 0 0 . 0 0 % 20 1 1 3 1 0 , 9 3 3 2 9 5 , 4 0 2 9 5 . 0 1 % 20 1 2 2 5 3 , 3 0 4 2 5 3 , 3 0 4 1 0 0 . 0 0 % 20 1 3 2 6 7 , 4 7 1 2 4 2 , 7 7 4 1 1 0 . 1 7 % Va l u e (2 ) - ( 1 ) of P l a n A s s e t s (A A L ) - E n t r y A g e Li a b i l i t y Co v e r e d Pa y r o l l (5 ) An n u a l Ac c r u e d Li a b i l i t y (4 ) Un f u n d e d (O v e r f u n d e d ) Ac t u a r i a l (1 ) Ac t u a r i a l (2 ) Ac t u a r i a l Ac c r u e d Em p l o y e r Co n t r i b u t i o n s An n u a l Re q u i r e d Co n t r i b u t i o n UN I T E D C I T Y O F Y O R K V I L L E , I L L I N O I S Po l i c e P e n s i o n F u n d Re q u i r e d S u p p l e m e n t a r y I n f o r m a t i o n Sc h e d u l e o f F u n d i n g P r o g r e s s a n d E m p l o y e r C o n t r i b u t i o n s Ap r i l 3 0 , 2 0 1 3 Fu n d i n g P r o g r e s s (6)Unfunded (Overfunded)Actuarial Accrued Liability as a Ac t u a r i a l ( 3 ) P e r c e n t a g e Va l u a t i o n F u n d e d o f C o v e r e d Da t e R a t i o P a y r o l l Ap r . 3 0 , ( 1 ) ÷ ( 2 ) ( 4 ) ÷ ( 5 ) 20 0 7 $ 2 , 1 5 6 , 8 7 5 $ 5 , 7 2 8 , 7 2 2 3 7 . 6 5 % $ 3 , 5 7 1 , 8 4 7 $ 1 , 5 7 3 , 8 3 2 2 2 6 . 9 5 % 20 0 8 2 , 6 3 1 , 5 9 4 7 , 3 8 2 , 0 2 3 3 5 . 6 5 % 4 , 7 5 0 , 4 2 9 1 , 7 8 9 , 0 4 2 2 6 5 . 5 3 % 20 0 9 2 , 7 5 9 , 1 1 9 8 , 2 7 2 , 0 7 6 3 3 . 3 5 % 5 , 5 1 2 , 9 5 7 1 , 9 2 6 , 1 2 5 2 8 6 . 2 2 % 20 1 0 3 , 6 4 3 , 3 5 5 9 , 5 0 9 , 7 9 5 3 8 . 3 1 % 5 , 8 6 6 , 4 4 0 1 , 8 1 9 , 9 5 7 3 2 2 . 3 4 % 20 1 1 4 , 2 1 6 , 8 5 5 1 0 , 3 9 3 , 5 2 0 4 0 . 5 7 % 6 , 1 7 6 , 6 6 5 1 , 8 9 0 , 0 4 6 3 2 6 . 8 0 % 20 1 2 4 , 4 8 1 , 6 0 1 1 0 , 4 6 3 , 7 3 7 4 2 . 8 3 % 5 , 9 8 2 , 1 3 6 1 , 6 9 4 , 4 4 5 3 5 3 . 0 4 % Em p l o y e r C o n t r i b u t i o n s Fi s c a l Percent Ye a r Contributed 20 0 8 $ 2 7 5 , 1 4 4 $ 3 3 9 , 0 7 1 8 1 . 1 5 % 20 0 9 2 9 7 , 3 2 8 3 8 3 , 5 0 2 7 7 . 5 3 % 20 1 0 3 2 3 , 2 9 1 4 2 9 , 5 6 2 7 5 . 2 6 % 20 1 1 3 3 6 , 0 7 5 4 8 1 , 2 0 7 6 9 . 8 4 % 20 1 2 3 6 0 , 3 5 6 4 9 6 , 9 5 2 7 2 . 5 1 % 20 1 3 4 3 8 , 7 1 1 5 4 2 , 6 4 8 8 0 . 8 5 % (4) (2 ) Unfunded (1 ) A c t u a r i a l (Overfunded) Ac t u a r i a l Ac c r u e d Actuarial(5) Va l u e L i a b i l i t y AccruedAnnual of P l a n (A A L ) LiabilityCovered A s s e t s - E n t r y A g e (2) - (1)Payroll Annual Em p l o y e r Required Co n t r i b u t i o n s Contribution 137 UNITED CITY OF YORKVILLE, ILLINOIS Other Post-Employment Benefit Plan Required Supplementary Information Schedule of Funding Progress and Employer Contributions April 30, 2013 Funding Progress (6) Unfunded (Overfunded) Actuarial Accrued Liability as a Actuarial(3)Percentage ValuationFundedof Covered DateRatioPayroll Apr. 30,(1) ÷ (2)(4) ÷ (5) 2008$N/A$N/AN/A$N/A$N/AN/A 2009-46,7470.00%46,7475,483,4090.85% 2010N/AN/AN/AN/AN/AN/A 2011N/AN/AN/AN/AN/AN/A 2012-566,4880.00%566,4884,553,60012.44% 2013N/AN/AN/AN/AN/AN/A Employer Contributions Fiscal Percent Year Contributed 2008$N/A$N/AN/A 20091,8144,15943.62% 20101,8144,14543.76% 20111,8144,14543.76% 20121,8144,14443.77% 201338,04636,363104.63% The City implemented GASB Statement No. 45 for the fiscal year ended April 30, 2009, and had a subsequent actuarial valuation performed for the fiscal year ended April 30, 2012. Information for prior years is not available. The City is required to have an actuarial valuation performed triennially. Annual Employer Required Contributions Contribution of Plan (AAL)Liability Covered Assets- Entry Age (2) - (1)Payroll Actuarial Accrued Actuarial (5) ValueLiability AccruedAnnual (4) (2)Unfunded (1)Actuarial (Overfunded) 138 139 140 141 142 143 144 145 146 147 148 149 150 UNITED CITY OF YORKVILLE, ILLINOIS COUNTRYSIDE AND DOWNTOWN TAX INCREMENTAL FINANCING DISTRICTS FINANCIAL AND COMPLIANCE REPORT FOR THE FISCAL YEAR ENDED APRIL 30, 2014 151 PAGE INDEPENDENT AUDITORS' REPORT ..........................................................................................1 FINANCIAL STATEMENTS Balance Sheet ..........................................................................................................................................2 Statement of Revenues, Expenditures and Changes in Fund Balance ...................................................3 Notes to the Financial Statements ...........................................................................................................4 INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ...........................................................5 152 INDEPENDENT AUDITORS’ REPORT 153 INDEPENDENT AUDITORS' REPORT August 20, 2014 The Honorable City Mayor Members of the City Council United City of Yorkville, Illinois We have audited the accompanying basic financial statements of the governmental activities of the Countryside and Downtown Tax Incremental Financing Districts of the United City of Yorkville, Illinois as of and for the year ended April 30, 2014, which collectively comprise the Countryside and Downtown Tax Incremental Financing Districts as listed in the table of contents. The basic financial statements are the responsibility of the United City of Yorkville, Illinois’ management. Our responsibility is to express an opinion on these basic 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 basic financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the basic financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As described in Note 1 to the basic financial statements, the basic financial statements present only the Countryside and Downtown Tax Incremental Financing Districts of the United City of Yorkville, Illinois, and are not intended to present fairly the financial position or results of operations of the United City of Yorkville, Illinois, in conformity with accounting principles generally accepted in the United States of America. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Countryside and Downtown Tax Incremental Financing Districts of the United City of Yorkville, Illinois as of April 30, 2014, and the results of its operations for the year then ended in conformity with accounting principles generally accepted in the United States of America. We have also issued a report dated August 20, 2014 on our consideration of the Countryside and Downtown Tax Incremental Financing Districts’ compliance with laws, regulations, contracts and grants. LAUTERBACH & AMEN, LLP 154 FINANCIAL STATEMENTS 155 UNITED CITY OF YORKVILLE, ILLINOIS COUNTRYSIDE AND DOWNTOWN TAX INCREMENTAL FINANCING DISTRICTS Balance Sheet April 30, 2014 Downtown TIF Cash and Investments $- 250,835 Receivables - Net of Allowances Other Taxes 1,951 2,834 Prepaids - 618 Total Assets 1,951 254,287 Liabilities Accounts Payable - 12,315 Deposits Payable 2,043 - Other Liabilities - 10,443 Due to Other Funds 533,384 - Total Liabilities 535,427 22,758 Property and State Taxes 611 - Total Liabilities and Deferred Inflows of Resources 536,038 22,758 Fund Balances Nonspendable - 618 Restricted - 230,911 Unassigned (534,087)- Total Fund Balances (534,087)231,529 Total Liabilities and Fund Balances 1,951 254,287 Countryside TIF LIABILITIES DEFERRED INFLOWS OF RESOURCES ASSETS 156 UNITED CITY OF YORKVILLE, ILLINOIS COUNTRYSIDE AND DOWNTOWN TAX INCREMENTAL FINANCING DISTRICTS Statement of Revenues, Expenditures and Changes in Fund Balance For the Fiscal Year Ended April 30, 2014 Downtown TIF Revenues Taxes Property Taxes $- 52,811 Business District Taxes 2,043 9,458 Interest 107 50 Miscellaneous - 184 Total Revenues 2,150 62,503 Expenditures General Government Administration Fees 3,416 5,070 TIF Incentive Payout 1,800,000 12,315 Business District Rebate 2,043 9,458 Capital Outlay - 29,568 Debt Service Principal Retirement 185,000 - Interest and Fiscal Charges 161,116 - Total Expenditures 2,151,575 56,411 Excess (Deficiency) of Revenues Over (Under) Expenditures (2,149,425)6,092 Other Financing Sources (Uses) Disposal of Capital Assets - 8,500 Debt Issuance 1,235,000 - Discount on Debt Issuance (9,773)- Payment to Escrow Agent (1,182,224)- 43,003 8,500 Net Change in Fund Balances (2,106,422)14,592 Fund Balances - Beginning 1,572,335 216,937 Fund Balances - Ending (534,087)231,529 Countryside TIF 157 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The operations of Countryside and Downtown Tax Incremental Financing Districts are accounted for through special revenue funds of the United City of Yorkville, Illinois. It applies the following policies: Basis of Accounting The financial statements are prepared on the modified accrual basis of accounting under which revenue is recognized when it becomes both measurable and available, and expenditures generally are recognized when the liability is incurred. 158 INDEPENDENT AUDITORS' REPORT ON COMPLIANCE BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS August 20, 2014 The Honorable City Mayor Members of the City Council United City of Yorkville, Illinois We have audited the accompanying basic financial statements of the governmental activities of the Countryside and Downtown Tax Incremental Financing Districts of the United City of Yorkville, Illinois, as of and for the year ended April 30, 2014, and have issued our report thereon dated August 20, 2014. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Compliance Compliance with laws, regulations, contracts, and grants applicable to the Financing Districts are the responsibility of the United City of Yorkville’s management. As part of obtaining reasonable assurance about whether basic financial statements are free of material misstatement, we performed tests of the City’s compliance with certain provisions of laws, regulations, contracts and grants applicable to the Financing District, including the City’s compliance with subsection (q) of Section 11-74.4-3 of the State of Illinois Public Act 85-1142, An Act in Relation to Tax Increment Financing, noncompliance with which could have a direct and material effect on the determination of basic financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance with the provisions referred to in the preceding paragraph. This report is intended for the information of the members of the City Council and management, and is not intended to be used and should not be used by anyone other then these specified parties. LAUTERBACH & AMEN, LLP 159 Downtown TIF District 16 0 SECTION 2 [Sections 2 through 5 must be completed for each redevelopment project area listed in Section 1.] FY 2014 Name of Redevelopment Project Area: Primary Use of Redevelopment Project Area*: If "Combination/Mixed" List Component Types: No Yes Werethere any amendments to theredevelopmentplan,theredevelopmentproject area,or the State Sales Tax Boundary? [65 ILCS 5/11-74.4-5 (d) (1) and 5/11-74.6-22 (d) (1)] If yes, please enclose the amendment labeled Attachment A x Certificationof theChiefExecutive Officerof the municipality that the municipality has compliedwith all of therequirements of the Act duringthepreceding fiscalyear.[65 ILCS 5/11-74.4-5 (d)(3)and 5/11-74.6- 22 (d) (3)] Please enclose the CEO Certification labeled Attachment B x Opinionof legalcounsel that municipalityisincompliancewith the Act.[65 ILCS 5/11-74.4-5 (d)(4)and 5/11-74.6-22 (d) (4)] Please enclose the Legal Counsel Opinion labeled Attachment C x Werethere any activities undertaken in furtherance of theobjectives of theredevelopmentplan, including any projectimplemented in thepreceding fiscalyearand adescriptionof the activities undertaken? [65 ILCS 5/11-74.4-5 (d) (7) (A and B) and 5/11-74.6-22 (d) (7) (A and B)] If yes, please enclose the Activities Statement labeled Attachment D x Were any agreementsentered into bythe municipalitywith regard to the dispositionor redevelopment of any property within theredevelopmentproject area or the area within the State Sales Tax Boundary? [65 ILCS 5/11-74.4-5 (d) (7) (C) and 5/11-74.6-22 (d) (7) (C)] If yes, please enclose the Agreement(s) labeled Attachment E x Is there additionalinformationon the use of all fundsreceivedunder thisDivision and steps taken bythe municipality to achieve theobjectives of theredevelopmentplan?[65 ILCS 5/11-74.4-5 (d)(7)(D)and 5/11-74.6-22 (d) (7) (D)] If yes, please enclose the Additional Information labeled Attachment F x Did the municipality's TIF advisors or consultantsenter into contracts with entities or persons thathave received or are receivingpaymentsfinancedby tax incrementrevenuesproducedbythe same TIF?[65 ILCS 5/11-74.4-5 (d) (7) (E) and 5/11-74.6-22 (d) (7) (E)] If yes, please enclose the contract(s) or description of the contract(s) labeled Attachment G x Werethere any reports or meetingminutessubmitted to the municipality bythe joint reviewboard?[65 ILCS 5/11-74.4-5 (d) (7) (F) and 5/11-74.6-22 (d) (7) (F)] If yes, please enclose the Joint Review Board Report labeled Attachment H x Were any obligations issued by municipality? [65 ILCS 5/11-74.4-5 (d) (8) (A) and 5/11-74.6-22 (d) (8) (A)] If yes, please enclose the Official Statement labeled Attachment I x Wasanalysis preparedby a financialadvisor or underwritersetting forth thenature and term of obligation and projecteddebt service includingrequiredreserves and debtcoverage?[65 ILCS 5/11-74.4- 5 (d) (8) (B) and 5/11-74.6-22 (d) (8) (B)] If yes, please enclose the Analysis labeled Attachment J x Cumulatively,havedepositsequalorgreaterthan$100,000beenmade into the special tax allocation fund? 65 ILCS 5/11-74.4-5 (d) (2) and 5/11-74.6-22 (d) (2) If yes, please enclose Audited financial statements of the special tax allocation fund labeled Attachment K x Cumulatively,havedepositsofincrementalrevenueequal to orgreaterthan$100,000beenmade into the special tax allocation fund? [65 ILCS 5/11-74.4-5 (d) (9) and 5/11-74.6-22 (d) (9)] If yes,pleaseenclose a certifiedletterstatement reviewing compliance with the Act labeled Attachment L x A list of all intergovernmental agreements in effect in FY 2010, to which the municipality is a part, and an accounting of any money transferred or received by the municipality during that fiscal year pursuant to those intergovernmental agreements. [65 ILCS 5/11-74.4-5 (d) (10)] If yes, please enclose list only of the intergovernmental agreements labeled Attachment M x * Types include: Central Business District, Retail, Other Commercial, Industrial, Residential, and Combination/Mixed. Downtown Yorkville Commercial Under which section of the Illinois Municipal Code was Redevelopment Project Area designated? (check one): Tax Increment Allocation Redevelopment Act __x___ Industrial Jobs Recovery Law _____ 161 FY 2014 Fund Balance at Beginning of Reporting Period 216,937$ Revenue/Cash Receipts Deposited in Fund During Reporting FY:Reporting Year Cumulative* % of Total Property Tax Increment 52,811$ 430,859$ 99% State Sales Tax Increment 0% Local Sales Tax Increment 0% State Utility Tax Increment 0% Local Utility Tax Increment 0% Interest 50$ 4,155$ 1% Land/Building Sale Proceeds 0% Bond Proceeds 0% Transfers from Municipal Sources 0% Private Sources 0% 2013 TAP Grant 184$ 184$ 0% Total Amount Deposited in Special Tax Allocation Fund During Reporting Period 53,045$ Cumulative Total Revenues/Cash Receipts 435,198$ 100% Total Expenditures/Cash Disbursements (Carried forward from Section 3.2)46,953$ Distribution of Surplus Total Expenditures/Disbursements 46,953$ NET INCOME/CASH RECEIPTS OVER/(UNDER) CASH DISBURSEMENTS 6,092$ FUND BALANCE, END OF REPORTING PERIOD*223,029$ * if there is a positive fund balance at the end of the reporting period, you must complete Section 3.3 SURPLUS*/(DEFICIT)(Carried forward from Section 3.3)(476,971)$ SECTION 3.1 - (65 ILCS 5/11-74.4-5 (d) (5) and 65 ILCS 5/11-74.6-22 (d) (5)) Provide an analysis of the special tax allocation fund. *must be completed where 'Reporting Year' is populated TIF NAME: Downtown Yorkville 162 FY 2014 Amounts Reporting Fiscal Year 1. Costs of studies, administration and professional services—Subsections (q)(1) and (o) (1) Legal Services 4,812 Auditing Services - TIF Compliance Report 250 JRB Packet Postage 8 Engineering Services 7,591 Title Services 151 12,812$ 2. Cost of marketing sites—Subsections (q)(1.6) and (o)(1.6) Yorkville River Night 1,200 AMOY Kayak Event 332 Summer Solstice 294 1,826$ -$ -$ IL Route 47 Expansion 20,000 20,000$ -$ 3.Propertyassembly,demolition,site preparationandenvironmental site improvement costs. Subsection (q)(2), (o)(2) and (o)(3) 4.Costsofrehabilitation,reconstruction,repairorremodelingofexistingpublicorprivatebuildings. Subsection (q)(3) and (o)(4) 5. Costs of construction of public works and improvements. Subsection (q)(4) and (o)(5) 6.Costsofremovingcontaminantsrequiredbyenvironmental laws orrules (o)(6)-IndustrialJobs Recovery TIFs ONLY SECTION 3.2 A- (65 ILCS 5/11-74.4-5 (d) (5) and 65 ILCS 5/11-74.6-22 (d) (5)) Category of Permissible Redevelopment Cost [65 ILCS 5/11-74.4-3 (q) and 65 ILCS 5/11-74.6- 10 (o)] FOR AMOUNTS >$10,000 SECTION 3.2 B MUST BE COMPLETED ITEMIZED LIST OF ALL EXPENDITURES FROM THE SPECIAL TAX ALLOCATION FUND (by category of permissible redevelopment cost, amounts expended during reporting period) TIF NAME: Downtown Yorkville 163 -$ -$ -$ -$ -$ -$ -$ 8. Financing costs. Subsection (q) (6) and (o)(8) 7.Costofjobtrainingandretraining,including"welfare to work"programsSubsection (q)(5),(o)(7) and (o)(12) PAGE 2 SECTION 3.2 A 9. Approved capital costs. Subsection (q)(7) and (o)(9) 10.CostofReimbursingschool districts fortheirincreased costs causedby TIF assisted housing projects. Subsection (q)(7.5) - Tax Increment Allocation Redevelopment TIFs ONLY 11. Relocation costs. Subsection (q)(8) and (o)(10) 12. Payments in lieu of taxes. Subsection (q)(9) and (o)(11) 13.Costsofjobtraining,retrainingadvancedvocationalorcareereducationprovidedbyother taxing bodies. Subsection (q)(10) and (o)(12) 164 Developer Incentive 12,315 12,315$ -$ -$ 46,953$ 15.Costsofconstructionofnewhousingunitsforlowincomeand very low-incomehouseholds. Subsection (q)(11)(F) - Tax Increment Allocation Redevelopment TIFs ONLY 16.Costofday care services andoperational costs ofday care centers.Subsection (q)(11.5)-Tax Increment Allocation Redevelopment TIFs ONLY TOTAL ITEMIZED EXPENDITURES 14.Costsofreimbursingprivatedevelopersforinterestexpensesincurredonapproved redevelopment projects. Subsection (q)(11)(A-E) and (o)(13)(A-E) SECTION 3.2 A PAGE 3 165 FY 2014 ______ There were no vendors, including other municipal funds, paid in excess of $10,000 during the current reporting period. Name Service Amount Imperial Investments Developer Incentive 12,315$ State of Illinois Treasurer - c/o IDOT IL Rte 47 Expansion 20,000$ List all vendors, including other municipal funds, that were paid in excess of $10,000 during the current reporting year. Section 3.2 B TIF NAME: Downtown Yorkville 166 FY 2014 FUND BALANCE, END OF REPORTING PERIOD 223,029$ Amount of Original Issuance Amount Designated 1. Description of Debt Obligations Total Amount Designated for Obligations -$ -$ 2. Description of Project Costs to be Paid IL Rte 47 Expansion Project 200,000$ Imperial Investments Redevelopment Agreement Phase 1 (est.)500,000$ Total Amount Designated for Project Costs 700,000$ TOTAL AMOUNT DESIGNATED 700,000$ SURPLUS*/(DEFICIT)(476,971)$ * NOTE: If a surplus is calculated, the municipality may be required to repay the amount to overlapping taxing SECTION 3.3 - (65 ILCS 5/11-74.4-5 (d) (5) 65 ILCS 11-74.6-22 (d) (5)) Breakdown of the Balance in the Special Tax Allocation Fund At the End of the Reporting Period TIF NAME: Downtown Yorkville 167 FY 2014 __X___ No property was acquired by the Municipality Within the Redevelopment Project Area Property Acquired by the Municipality Within the Redevelopment Project Area Property (1): Street address: Approximate size or description of property: Purchase price: Seller of property: Property (2): Street address: Approximate size or description of property: Purchase price: Seller of property: Property (3): Street address: Approximate size or description of property: Purchase price: Seller of property: Property (4): Street address: Approximate size or description of property: Purchase price: Seller of property: Providea descriptionofallpropertypurchasedbythemunicipalityduringthereporting fiscal year within the redevelopment project area. SECTION 4 [65 ILCS 5/11-74.4-5 (d) (6) and 65 ILCS 5/11-74.6-22 (d) (6)] TIF NAME: Downtown Yorkville 168 FY 2014 ______ ___1___ TOTAL:11/1/99 to Date Estimated Investment for Subsequent Fiscal Year Total Estimated to Complete Project Private Investment Undertaken (See Instructions)8,000,000$ -$ 8,000,000$ Public Investment Undertaken 36,378$ 12,315$ 524,063$ Ratio of Private/Public Investment 219 21/23 15 13/49 Project 1: *IF PROJECTS ARE LISTED NUMBER MUST BE ENTERED ABOVE Landscaping Private Investment Undertaken (See Instructions)-$ -$ -$ Public Investment Undertaken 24,063$ -$ 24,063$ Ratio of Private/Public Investment 0 0 Project 2: Imperial Investments - Phase 1 est. Private Investment Undertaken (See Instructions)8,000,000$ -$ 8,000,000$ Public Investment Undertaken 12,315$ 12,315$ 500,000$ Ratio of Private/Public Investment 649 43/70 16 Project 3: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 4: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 5: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 6: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 SECTION 5 - 65 ILCS 5/11-74.4-5 (d) (7) (G) and 65 ILCS 5/11-74.6-22 (d) (7) (G) PAGE 1 SECTION 5 PROVIDES PAGES 1-3 TO ACCOMMODATE UP TO 25 PROJECTS. PAGE 1 MUST BE INCLUDED WITH TIF REPORT. PAGES 2-3 SHOULD BE INCLUDED ONLY IF PROJECTS ARE LISTED ON THESE PAGES ENTER total number of projects undertaken by the Municipality Within the Redevelopment Project Area and list them in detail below*. Check here if NO projects were undertaken by the Municipality Within the Redevelopment Project Area: TIF NAME: Downtown Yorkville 169 Project 7: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 8: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 9: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 10: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 11: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 12: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 13: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 14: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 15: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 PAGE 2 170 Project 16: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 17: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 18: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 19: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 20: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 21: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 22: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 23: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 24: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 Project 25: Private Investment Undertaken (See Instructions) Public Investment Undertaken Ratio of Private/Public Investment 0 0 PAGE 3 171 SECTION 6 FY 2014 Provide the base EAV (at the time of designation) and the EAV for the year reported for the redevelopment project area Year redevelopment project area was designated Base EAV Reporting Fiscal Year EAV 6/13/2005 5,745,902$ 6,170,819$ SECTION 7 Provide information about job creation and retention Number of Jobs Retained Number of Jobs Created Description and Type (Temporary or Permanent) of Jobs Total Salaries Paid -$ -$ -$ -$ -$ -$ -$ SECTION 8 Provide a general description of the redevelopment project area using only major boundaries: Optional Documents Enclosed Legal description of redevelopment project area previously provided Map of District previously provided -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ Optional:Information in the following sections is not required by law,butwouldbehelpful in evaluating the performance of TIF in Illinois. *even though optional MUST be included as part of complete TIF report List all overlapping tax districts in the redevelopment project area. If overlapping taxing district received a surplus, list the surplus. __X___ The overlapping taxing districts did not receive a surplus. Overlapping Taxing District Surplus Distributed from redevelopment project area to overlapping districts TIF NAME: Downtown Yorkville 172 17 3 174 Unit Code 047/035/30 Attachment D Activities Statement Downtown Yorkville The Downtown TIF district was created in 2006 to help facilitate mixed use development in the downtown area. Over the last three fiscal years, the City has entered into several agreements with Imperial Investments for the redevelopment of several buildings in the downtown area. This proposed mixed use development has resulted in several new store fronts being added to the downtown, including Rowdy’s Bar & Grill, Mongolian 211 and an additional restaurant (Barley Fork) currently under construction. Construction continued in fiscal year 2014 on the IL Route 47 expansion, which is a joint project between the City and the Illinois Department of Transportation. This project will include various roadway and infrastructure (water, sanitary sewer, storm sewer) improvements on Route 47, from just south of Kennedy Road through its intersection with IL Route 71. The cost of the project that is applicable to the Downtown TIF district is approximately $200,000. In addition, the City continued its engineering study regarding the remediation of a brownfield site and neared completion of a new parking lot in the downtown area. 175 17 6 17 7 17 8 17 9 18 0 18 1 18 2 18 3 18 4 18 5 18 6 18 7 18 8 18 9 19 0 19 1 19 2 UNITED CITY OF YORKVILLE, ILLINOIS COUNTRYSIDE AND DOWNTOWN TAX INCREMENTAL FINANCING DISTRICTS FINANCIAL AND COMPLIANCE REPORT FOR THE FISCAL YEAR ENDED APRIL 30, 2014 193 PAGE INDEPENDENT AUDITORS' REPORT ..........................................................................................1 FINANCIAL STATEMENTS Balance Sheet ..........................................................................................................................................2 Statement of Revenues, Expenditures and Changes in Fund Balance ...................................................3 Notes to the Financial Statements ...........................................................................................................4 INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS ...........................................................5 194 INDEPENDENT AUDITORS’ REPORT 195 INDEPENDENT AUDITORS' REPORT August 20, 2014 The Honorable City Mayor Members of the City Council United City of Yorkville, Illinois We have audited the accompanying basic financial statements of the governmental activities of the Countryside and Downtown Tax Incremental Financing Districts of the United City of Yorkville, Illinois as of and for the year ended April 30, 2014, which collectively comprise the Countryside and Downtown Tax Incremental Financing Districts as listed in the table of contents. The basic financial statements are the responsibility of the United City of Yorkville, Illinois’ management. Our responsibility is to express an opinion on these basic 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 basic financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the basic financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As described in Note 1 to the basic financial statements, the basic financial statements present only the Countryside and Downtown Tax Incremental Financing Districts of the United City of Yorkville, Illinois, and are not intended to present fairly the financial position or results of operations of the United City of Yorkville, Illinois, in conformity with accounting principles generally accepted in the United States of America. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Countryside and Downtown Tax Incremental Financing Districts of the United City of Yorkville, Illinois as of April 30, 2014, and the results of its operations for the year then ended in conformity with accounting principles generally accepted in the United States of America. We have also issued a report dated August 20, 2014 on our consideration of the Countryside and Downtown Tax Incremental Financing Districts’ compliance with laws, regulations, contracts and grants. LAUTERBACH & AMEN, LLP 196 FINANCIAL STATEMENTS 197 UNITED CITY OF YORKVILLE, ILLINOIS COUNTRYSIDE AND DOWNTOWN TAX INCREMENTAL FINANCING DISTRICTS Balance Sheet April 30, 2014 Downtown TIF Cash and Investments $- 250,835 Receivables - Net of Allowances Other Taxes 1,951 2,834 Prepaids - 618 Total Assets 1,951 254,287 Liabilities Accounts Payable - 12,315 Deposits Payable 2,043 - Other Liabilities - 10,443 Due to Other Funds 533,384 - Total Liabilities 535,427 22,758 Property and State Taxes 611 - Total Liabilities and Deferred Inflows of Resources 536,038 22,758 Fund Balances Nonspendable - 618 Restricted - 230,911 Unassigned (534,087)- Total Fund Balances (534,087)231,529 Total Liabilities and Fund Balances 1,951 254,287 Countryside TIF LIABILITIES DEFERRED INFLOWS OF RESOURCES ASSETS 198 UNITED CITY OF YORKVILLE, ILLINOIS COUNTRYSIDE AND DOWNTOWN TAX INCREMENTAL FINANCING DISTRICTS Statement of Revenues, Expenditures and Changes in Fund Balance For the Fiscal Year Ended April 30, 2014 Downtown TIF Revenues Taxes Property Taxes $- 52,811 Business District Taxes 2,043 9,458 Interest 107 50 Miscellaneous - 184 Total Revenues 2,150 62,503 Expenditures General Government Administration Fees 3,416 5,070 TIF Incentive Payout 1,800,000 12,315 Business District Rebate 2,043 9,458 Capital Outlay - 29,568 Debt Service Principal Retirement 185,000 - Interest and Fiscal Charges 161,116 - Total Expenditures 2,151,575 56,411 Excess (Deficiency) of Revenues Over (Under) Expenditures (2,149,425)6,092 Other Financing Sources (Uses) Disposal of Capital Assets - 8,500 Debt Issuance 1,235,000 - Discount on Debt Issuance (9,773)- Payment to Escrow Agent (1,182,224)- 43,003 8,500 Net Change in Fund Balances (2,106,422)14,592 Fund Balances - Beginning 1,572,335 216,937 Fund Balances - Ending (534,087)231,529 Countryside TIF 199 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The operations of Countryside and Downtown Tax Incremental Financing Districts are accounted for through special revenue funds of the United City of Yorkville, Illinois. It applies the following policies: Basis of Accounting The financial statements are prepared on the modified accrual basis of accounting under which revenue is recognized when it becomes both measurable and available, and expenditures generally are recognized when the liability is incurred. 200 INDEPENDENT AUDITORS' REPORT ON COMPLIANCE BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS August 20, 2014 The Honorable City Mayor Members of the City Council United City of Yorkville, Illinois We have audited the accompanying basic financial statements of the governmental activities of the Countryside and Downtown Tax Incremental Financing Districts of the United City of Yorkville, Illinois, as of and for the year ended April 30, 2014, and have issued our report thereon dated August 20, 2014. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Compliance Compliance with laws, regulations, contracts, and grants applicable to the Financing Districts are the responsibility of the United City of Yorkville’s management. As part of obtaining reasonable assurance about whether basic financial statements are free of material misstatement, we performed tests of the City’s compliance with certain provisions of laws, regulations, contracts and grants applicable to the Financing District, including the City’s compliance with subsection (q) of Section 11-74.4-3 of the State of Illinois Public Act 85-1142, An Act in Relation to Tax Increment Financing, noncompliance with which could have a direct and material effect on the determination of basic financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance with the provisions referred to in the preceding paragraph. This report is intended for the information of the members of the City Council and management, and is not intended to be used and should not be used by anyone other then these specified parties. LAUTERBACH & AMEN, LLP 201