Comprehensive Annual Financial Report FY 2015-2016 by City of Edmond

CUSTOMER SERVICE

INNOVATION

INTEGRITY

INCLUSION

2016

COMPREHENSIVE ANNUAL FINANCIAL REPORT

COMMUNICATION

TEAMWORK

PROFESSIONALISM

CORE

ACCOUNTABILITY

8 VA L U ES

E XCEL L ENCE IN REP OR TING

City of Edmond, Oklahoma â&#x20AC;¢ Fiscal Year Ending June 30, 2016

CITY OF EDMOND, OKLAHOMA COMPREHENSIVE ANNUAL FINANCIAL REPORT AND ACCOMPANYING INDEPENDENT AUDITORâ&#x20AC;&#x2122;S REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2016

Prepared by: Financial Services Department Ross VanderHamm Finance Director

CITY OF EDMOND, OKLAHOMA COMPREHENSIVE ANNUAL FINANCIAL REPORT AND ACCOMPANYING INDEPENDENT AUDITOR’S REPORT For the fiscal year ended June 30, 2016 TABLE OF CONTENTS

Page INTRODUCTION SECTION: Letter of Transmittal

1-9

List of Principal Officials

City Governmental Organization Chart

Certificate of Achievement for Excellence in Financial Reporting

FINANCIAL SECTION: INDEPENDENT AUDITOR’S REPORT

13-14

MANAGEMENT DISCUSSION AND ANALYSIS

15-28

BASIC FINANCIAL STATEMENTS: Statement of Net Position

Statement of Activities

Balance Sheet – Governmental Funds

31-32

Statement of Revenues, Expenditures and Changes In Fund Balance – Governmental Funds

33-34

Statement of Net Position – Proprietary Funds

Statement of Revenues, Expenses and Changes In Fund Net Position– Proprietary Funds

Statement of Cash Flows – Proprietary Funds

Statement of Fiduciary Net Position – Fiduciary Funds

Statement of Changes in Fiduciary Net Position – Pension Trust Fund

Notes to Basic Financial Statements

40-88

CITY OF EDMOND, OKLAHOMA COMPREHENSIVE ANNUAL FINANCIAL REPORT AND ACCOMPANYING INDEPENDENT AUDITOR’S REPORT For the fiscal year ended June 30, 2016 TABLE OF CONTENTS Page REQUIRED SUPPLEMENTARY INFORMATION: Budgetary Comparison Schedule –(Non-GAAP Budgetary Basis) - General Fund

90-92

Budgetary Comparison Schedule- (Non-GAAP Budgetary Basis) – Major Special Revenue Funds

93-94

Notes to Budgetary Comparison Schedules

95-96

Schedule of Share of Net Pension Liability – Police Pension & Schedule of City Contributions – Police Pension & Retirement System

Schedule of Share of Net Pension Liability – Firefighter’s System & Schedule of City Contributions – Firefighter’s Pension & Retirement

Single-Employer Defined Benefit Schedule of Changes in Net Pension Liability and Related Ratios

Pension Fund Schedule of City’s Contributions-Last Ten Years

100

Pension Fund Schedule of Investment Returns

101

OPEB Plan Funding Schedule

102

OTHER SUPPLEMENTARY INFORMATION: GENERAL FUND COMBINING SCHEDULES: General Fund Account Descriptions

104

Combining Balance Sheet – General Fund Accounts

105

Combining Schedule of Revenues, Expenditures and Changes in Fund Balance – General Fund Accounts

106

Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual (Non-GAAP Budgetary Basis) – General Fund Accounts

107-108

NONMAJOR GOVERNMENTAL FUNDS: Fund Descriptions

109-110

Combining Balance Sheet – Nonmajor Governmental Funds

111-112

Combining Statement of Revenues, Expenditures and Changes in Fund Balance – Nonmajor Governmental Funds

113-114

CITY OF EDMOND, OKLAHOMA COMPREHENSIVE ANNUAL FINANCIAL REPORT AND ACCOMPANYING INDEPENDENT AUDITOR’S REPORT For the fiscal year ended June 30, 2016 TABLE OF CONTENTS Page Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual (Non-GAAP Budgetary Basis) - Nonmajor Governmental Funds

115-120

Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual (Non-GAAP Budgetary Basis) - Major Governmental Capital Project Funds

121

NONMAJOR ENTERPRISE FUNDS: Fund Descriptions

122

Combining Statement of Net Position – Nonmajor Enterprise Funds

123

Combining Statement of Revenues, Expenses and Changes In Fund Net Position – Nonmajor Enterprise Funds

124

Combining Statement of Cash Flows – Nonmajor Enterprise Funds

125

INTERNAL SERVICE FUNDS: Fund Descriptions

126

Combining Statement of Net Position - Internal Service Funds

127

Combining Statement of Revenues, Expenses and Changes in Fund Net Position – Internal Service Funds

128

Combining Statement of Cash Flows – Internal Service Funds

129

AGENCY FUNDS: Fund Descriptions

130

Combining Statement of Fiduciary Assets and Liabilities - Agency Funds

131

Combining Statement of Changes in Assets and Liabilities - Agency Funds

131

REVENUE BOND/NOTE COVENANT SCHEDULES: Schedule Descriptions

132

Schedule of Revenue Bond/Note Debt Service Coverage

133

Schedule of Reserve Account Balances

134

iii

CITY OF EDMOND, OKLAHOMA COMPREHENSIVE ANNUAL FINANCIAL REPORT AND ACCOMPANYING INDEPENDENT AUDITOR’S REPORT For the fiscal year ended June 30, 2016 TABLE OF CONTENTS Page DISCRETELY PRESENTED COMPONENT UNIT: Fund Description

135

Balance Sheet – Discretely Presented Component Unit

136

Statement of Revenues, Expenditures, and Changes in Fund Balance

137

STATISTICAL SECTION: Statistical Section Narrative

Table 139

Net Position by Component - Last Ten Fiscal Years

140

Changes in Net Position - Last Ten Fiscal Years

141-142

Fund Balances, Governmental Funds – Last Ten Fiscal Years

143

Changes in Fund Balances, Governmental Funds – Last Ten Fiscal Years

144

Governmental Activities Tax Revenues by Source – Last Ten Fiscal Years

145

Electricity Revenue by Customer Type - Last Nine Fiscal Years

146

Top Ten Electric Customers – Last Nine Years

147

Electricity Revenue Rate Structure – Last Nine Fiscal Years

148-152

Sales Tax Rates of Direct and Overlapping Governments – Last Ten Fiscal Years

153

Taxable Sales by Category - Last Ten Fiscal Years

154

Ratio for Outstanding Debt by Type – Last Ten Fiscal Years

155

Ratio of Net General Bonded Debt to Assessed Value and Net Bonded Debt per Capita – Last Ten Fiscal Years

156

Computation of Direct and Overlapping Debt

157

Legal Debt Margin Information – Last Ten Fiscal Years

158

The Edmond Public Works Authority Utility Systems Division Pledged Revenue Coverage – Last Ten Fiscal Years

159

Demographic and Economic Statistics – Last Ten Calendar Years

160

Principal Employers – Current and Ten Years Ago

161

CITY OF EDMOND, OKLAHOMA COMPREHENSIVE ANNUAL FINANCIAL REPORT AND ACCOMPANYING INDEPENDENT AUDITOR’S REPORT For the fiscal year ended June 30, 2016 TABLE OF CONTENTS STATISTICAL SECTION:

Table

Page

Full-Time Equivalent City Government Employees by Function/Program – Last Ten Fiscal Years

162

Capital Asset Statistics by Function/Program – Last Nine Fiscal Years

163

Operating Indicators by Function/Program – Last Nine Fiscal Years

164

Construction Permits – Last Ten Fiscal Years

165

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

THIS PAGE INTENTIONALLY LEFT BLANK

March 27, 2017 Honorable Mayor and City Councilmembers City of Edmond, Oklahoma Dear Mayor and Councilmembers: The Comprehensive Annual Financial Report of the City of Edmond (the ”City”) for the year ended June 30, 2016, is hereby submitted as mandated by the city charter and state statutes. The City is required to publish within six months of the close of each fiscal year a complete set of financial statements presented in conformance with generally accepted accounting principles (GAAP) and audited in accordance with generally accepted auditing standards by a firm of licensed certified public accountants. Responsibility of both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with the Financial Services Department of the City. The City has established a comprehensive internal control framework designed to both protect the City’s assets from loss, theft, or misuse and to compile sufficient reliable information for the preparation of the City of Edmond’s financial statements in conformity with GAAP. Since the cost of internal controls should not outweigh the benefits derived from those controls, the City’s comprehensive framework of internal controls has been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. We believe the information, as presented, is accurate in all material respects and is reported in a manner that presents fairly the financial position and results of operations of the various funds and component units of the City of Edmond. All disclosures necessary to enable the reader to gain an understanding of the City of Edmond’s activities have been included. The City’s financial statements have been audited by Arledge & Associates, P.C., a firm of licensed certified public accountants. The independent audit was conducted to provide reasonable assurance that the financial statements of the City are free of material misstatement. The independent audit examined, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessed the accounting principles used and estimates made by management, and evaluated the overall financial statement presentation. Based upon the results of their audit, Arledge & Associates, P.C. rendered unqualified opinions on all of the City’s opinion units within the financial statements for the year ending June 30, 2016. An unqualified opinion provides objective confirmation that the City’s financial statements are fairly presented in conformity with GAAP and free of material misstatement. The independent auditor’s report is presented as the first component of the financial section of this report.

In addition to the independent audit of the financial statements, the City is required to undergo an annual single audit in conformity with the provisions of the U.S. Office of Management and Budget’s Circular A‐ 133, “Audits of States, Local Governments, and Non‐Profit Organizations.” This audit requires the auditor to report on the government’s internal controls and compliance with legal requirements involved with the administration of major federal grant awards received by the City. These reports are designed to meet the special needs of federal grantor agencies and are available in the City of Edmond’s separately issued Single Audit Report. Generally accepted accounting principles require City management to provide a narrative introduction, overview and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This transmittal letter is designed to complement the MD&A and should be read in conjunction with it. The City’s MD&A can be found immediately following the report of the independent auditors. Edmond is located in the center of Oklahoma and is contiguous with the northern boundary of Oklahoma City, the capital city of the state and the largest city in Oklahoma. Incorporated in 1890, the City covers approximately 87 square miles and according to the July 1, 2015 US Census population estimate, there were 90,062 persons within the City. This is a population increase of 10.7% since 2010. The City features quiet suburban living with a central business district, major shopping and modern office areas, and a variety of and spacious residential developments. Edmond is the sixth‐largest community in Oklahoma but has the third largest public school district in the state. With over 23,900 public school students, Edmond has had 10 nationally recognized Blue Ribbon Schools and its public schools are better than 96% of schools in the rest of the state. There are also eight private schools within the City. Of residents 25‐and‐older, 52.1% have at least a bachelor’s degree, compared to the typical community of 24%. Two universities have a presence within the community, University of Central Oklahoma and Oklahoma Christian University, with a combined Fall 2015 enrollment of 19,497 students. Francis Tuttle Technological College also provides educational and training services in Edmond. Edmond has the lowest crime rate, per thousand population, in the Oklahoma City metro area. Crime rate decreased each year from 2013‐2015. Previous Federal Bureau of Investigation’s (FBI) statistics ranked Edmond as one of the safest cities in the nation and the safest city in Oklahoma with a population of more than 75,000. The FBI’s Uniform Crime Report looks at violent crime numbers including murder, rape, robbery and aggravated assault. In 2013, Edmond ranked in the top 6.31% of the safest reporting cities in the U.S. with a population above 75,000 for 2013, and it is the safest city in Oklahoma when compared to the ten largest cities in Oklahoma. Edmond is the third largest city in the Oklahoma City Metropolitan Statistical Area (MSA). The Oklahoma City MSA is the 41st largest in the U.S. with an estimated 2015 population of 1,459,758. In 2015, the Oklahoma City metro benefited from economic diversity that offset employment losses experienced in the oil and gas sector. Overall, 12,000 jobs were added over prior year, or about 2 percent annual growth. Unemployment for the metro remained low throughout 2015, ending the year near 3.6% (November 2015) and Oklahoma City has consistently been among the 10 lowest unemployment large metros for nearly five years.

As a whole, Oklahoma from November 2014 to November 2015 reveals that nonfarm employment was down 1300 jobs for the state, but up 10,700 jobs in the Oklahoma City metro area. As a whole, Oklahoma lost 13,000 mining (oil and gas) jobs between November 2014 and November 2015, with about 3000 of those jobs from the Oklahoma City metro. In 2015, the Oklahoma City metro finished the year with major employment projects that will affect the future of the region’s economy. These include the acquisition of 158 acres by Tinker Air Force base in Midwest City for a maintenance depot; the initiation of construction by Boeing for a research and development/laboratory facility; and the opening the new General Electric Global Research Center. The City has adopted a charter and operates under a Council‐Manager form of government pursuant to the charter and is recognized by the International City Management Association and the National League of Cities. The legislative authority of the City is vested in a five member elected council, consisting of one council member from each of four wards and the mayor who serves as council member at large. Council members serve four‐year staggered terms with two council members elected every two years. The Mayor is elected to serve a two‐year term. The City Council members are also the Trustees of the Edmond Public Works Authority. The Mayor and Council appoint the City Manager, who as the chief executive officer of the City is responsible to the Mayor and the City Council for the administration of all City services, including budget preparation, and employees under a merit plan. The City provides a wide range of municipal services, including police and fire protection, the construction and maintenance of highways, streets and other infrastructure, and a multitude of recreational and cultural events throughout the year. The City also provides electric, water, wastewater, drainage, and solid waste services to its residents under the legal entity of the Edmond Public Works Authority (EPWA). EPWA is a public trust created under applicable Oklahoma statutes on October 6, 1970, with the City named as the beneficiary thereof. These utility systems operate for the benefit of the City of Edmond and are an integral part of City operations. Electric rates were increased an average of 2.5%, effective November 2015. Water and Wastewater rates also rose in 2016 as part of a long term plan to provide funding for system improvements – including major plant expansion projects for the utilities. EPWA’s financial statements are blended into the City’s financial statements and together they comprise the City’s primary financial presentation. The City is also financially accountable for a legally separate economic development authority and a legally separate historic preservation trust. Both of these operations are reported separately within the City’s financial statements. Additional information on these operations may be found in Note 1.A in the notes to the financial statements. Five‐year strategic business plans and operating budgets developed to support those plans serve as the foundation for the City’s financial planning and control. The City Manager issues corporate guidelines that establish priorities and specific economic factors for the upcoming budget year. Budgets are then developed by departments for all five years. The City Manager’s recommended budget is required to be submitted to the City Council by June 1. The City Council must hold a public hearing on the budget by June 15 and adopt the budget at least seven days prior to July 1, which is the beginning of the new fiscal year. The appropriated budget is prepared by fund, department, and object level/category. Department Heads may make transfers of appropriations within an expenditure object category. Transfers between expenditure object categories of a department or fund and budget supplements must be approved by the City Council. Supplemental appropriations must also be filed with the Office of the State Auditor and Inspector.

Sales Tax and the Local Economy Edmond continued to show annual positive growth in base sales tax collections since FY09‐10. After an increase of 4.3% in collections from FY13‐14 to FY14‐15, the increase in growth was 0.69% in FY15‐16 from the previous budget year sales tax revenue.

3.75 % Sales Tax Split Police, .125 of the 3.75 or 3.3%

Public Safety, 0.50 of the 3.75 or 13.3%

Fire, .25 of the 3.75 or 6.7%

CIP, .75 of the 3.75 or 20%

General Fund, 2.00 of the 3.75 or 53.3%

Park, .125 of the 3.75 or 3.3%

General Fund's FY 16‐17 Budgeted 2% Sales Tax is $34,072,793 General Fund, 33.2%, $11,312,167

Fire, 30 %, $10,221,838 Police, 36.8%, $12,538,788

Typically, sales tax collections account for around 60% of General Fund revenues. However, due to the voter‐approved 2000 Sales Tax initiative, Public Safety (i.e. Fire and Police) Departments receive over 66% of the revenue from the 2% General Fund sales tax. In April 2012, a half‐cent sales tax increase to build a $25.5 million Public Safety Center was approved with 73% of the voters approving the tax for a five year period. Upon expiration of the tax issue on March 30, 2017, the tax will have collected a projected $41 million. Any remaining funds will be utilized for capital projects, as outlined in the approved ballot question.

14.81 12.04

9.68 7.98

9.92 5.48

12.67 7.58 8.68

6.38

6.44

4 63 5.94

3.5

2.7

4.3 0.69

‐5 ‐10 ‐5.49

In April 2016, Edmond voters overwhelmingly approved two sales tax extensions for ten additional years upon expiration of the existing taxes. The one‐cent General Fund sales tax extension won with a vote of 4,894 to 1,214, or 80.1% approval rate. The one‐cent tax rate is for the operations of the city and was originally approved in April 1977. The taxes have been extended by election for an additional ten‐year term and will not expire until April 2027. The half‐cent sales tax originally approved for the Public Safety Center was also extended during the April 2016 election. The renewed half‐cent tax will be utilized for capital improvements. The half‐cent extension won with a vote of 4,363 to 1,621, or 72.9% approval rate. Even with these renewed tax rates, Edmond’s sales tax will remain lower than the sales tax rates of neighboring communities. Edmond continues to experience a growth in both commercial and residential building. Commercial construction increased dramatically in 2016, with 74 permits issued for new commercial facilities, an increase over 42 in 2015 and 50 in 2014. The value of the commercial permits in 2016 was $109,419,000, an increase of over $75 million from the previous year. In fact, the value of commercial permits in 2016 exceeded the combined value of new commercial permits from the previous two years. Recent commercial developments included the construction of Campbell Corner, a 15,584 square foot retail center in downtown Edmond and also a multimillion dollar renovation of Bryant Square Shopping Center at the southeast corner of Bryant and Second Street. The goal is to attract a higher quality tenant to establish business in a higher upscale property.

Single family residential housing permits for new construction dipped again in 2016, down to 415, a decline of 128 in new homes from 2015. The total value of permits for new home construction in 2016 was $142,220,635, with per home value of more than $340,000 per unit.

Single Family Residential BuildingPermits Calendar Year 800 649

700 600

694

545

585

581 465

500 400

379

338

300

238

588

564

543 415

297

200 100 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Capital Improvements This fund is the main source of financing for major capital improvements in Edmond. Voter authorized in 1996 and then extended indefinitely in 2000, this three‐quarter percent tax has raised annually over $12.6 million. Although in excess of $100 million in bond financing has been backed by this fund, at the end of June 2015, the outstanding principal remaining on the 2000 CIP indebtedness had fallen to $62,153,107. The final maturity on the most recent issue is July 1, 2026. During the past 15 years, approximately $170,000,000 in projects have been constructed. Previous projects completed include the development of the Mitch Park YMCA/Edmond Public Schools Competitive Pool, the Kelly Street Widening from Covell to Coffee Creek and Edmond Park 66, an adult softball complex. Recent projects include Phase I on Covell, from Fairfax Boulevard to I‐35, began in 2015 and should be completed in 2017. This project complements interchange work that has facilitated the construction of a Hotel/Conference Center (HCC). Roadway improvements will be completed prior to the opening of the HCC. The anticipated development on the two northern corners of I‐35 and Covell represent the largest investment by the City in an economic development project. Edmond committed a total of $11 million from the CIP Fund for a variety of projects for the development corridor, including the purchase of the land for the HCC on the northwest corner; land on the northeast corner for a proposed indoor sports complex; infrastructure improvements to serve development west of the interchange and provide financial assistance for construction of the Conference Center. The development addresses many needs as identified by the community. The approved development agreement provides for the City to be repaid $9 million of the $11 million investment in 15 years as the developers buy out the City’s interest in the land and the conference center facility. This initiative should stimulate significant visitor traffic to Edmond and the corridor improvements will provide development sites for new commercial and retail opportunities along the I‐35 corridor. 6

Edmond has implemented the most extensive Intelligent Traffic System (ITS) in Oklahoma. The City will continue to develop the network through multi‐year CIP funding to improve traffic flow through the installation of continuous communication devices at high traffic intersections and controlled through a central computer system. The City has received financial assistance from Oklahoma Department of Transportation (ODOT) for the implementation of ITS. Traffic issues are the number one priority for the City, based upon citizen survey results. Many of the CIP selected projects address traffic issues, including the addition of turn lanes at 33rd and Broadway, plus turn lanes on Covell at both Santa Fe and Bryant. Covell improvements will continued to be phased into maximize funding from ODOT and as CIP funding is sufficient to continue improvements. Annually, the City utilizes CIP funding for the Street Overlay Program, which resurfaces and rehabilitates local streets. The annual CIP appropriation for the Overlay Program is approximately $2.1 million per year. With the expiration of the half‐cent Public Safety Center tax in April 2017 and the repurposing of the tax by the voters for ten years, the City will have an additional $8 million annually in sales tax revenues to support capital improvements.

Risk Management Program Safety and accountability are the responsibility of each department and overseen by the Risk Manager. The City is currently contracting with a third party administrator, CCMSI to process the City’s workers’ compensation claims. Alteris Insurance Services provides general liability insurance coverage and the City has CCMSI, a third party administrator, manage the liability claims. The Beckman Insurance Company is the City of Edmond’s insurance broker obtaining and placement of applicable insurance coverage. The City of Edmond is self‐insured for workers’ compensation with excess coverage provided by Midwest Employees Casualty Company. Additional information on Risk Management may be found in Note 4.B in the notes to the financial statements. The City’s actuary has determined that the estimated claim reported losses as of June 30, 2016 for worker’s compensation was $319,214, compared to $1,117,469 for the same period for FY14‐15, or a decrease of $798,255. Reported claims on Automobile and General Liability for FY15‐16 was $217,656, compared to $167,343 for the same period for FY15‐16, or an increase of $50,313.

Edmond's Workers Comp & Tort Claim History $3,000,000

$2,500,000

$2,000,000

$1,500,000

$1,000,000

FY06‐ FY07‐ FY08‐ FY09‐ FY10‐ FY11‐ FY12‐ FY13‐ FY14‐ FY15‐ 07 08 09 10 11 12 13 14 15 16 Tort Claims 632,00 586,00 684,00 638,00 751,00 747,00 771,00 1,120, 1,081, 1,081, Work Comp 631,00 562,00 794,00 926,00 1,336, 1,264, 1,213, 1,325, 1,656, 1,535,

Employee Retirement Plan As of June 30, 2016, the assets of the Employees’ Defined Benefit Pension Plan for non‐uniformed employees posted an investment loss of ($1,214,734) for an ending market value of $62,768,138. The investment returns for the calendar year of 2015 were (‐7.78%) compared to the benchmark of (‐7.76%). The year‐to‐date investment returns as of June 30, 2016 was 6.18% compared to the benchmark of 6.77%. Compared to the previous fiscal year the employee and employer contributions to the Plan increased $245,319 or 7%, the contributions and interest paid to terminated employees increased by approximately $224,210 or 20%, while benefit payments to retirees increased by approximately $275.421 or 14%.

Employees' Retirement Plan Assets History $70,000,000

$66,047,870 $63,695,635 $62,674,976

$60,000,000 $49,848,886 $56,663,891 $42,330,852 $50,874,309 $41,041,307 $34,747,236 $40,004,670 $40,000,000 $31,523,323 $34,598,761 $30,000,000

$50,000,000

$20,000,000 $10,000,000 $0 2005 2006 2007

2008 2009

2010 2011 2012 2013 2014 2015 2016

The City also participates in the Oklahoma Police Pension Retirement Fund and the Oklahoma Firefighters Pension and Retirement Fund on behalf of the City’s police and firefighters. These are statewide plans managed by the State of Oklahoma. Based upon certain wages defined by each plan, the Police contribution rates are 8% employee and 13% employer; the Fire contribution rates are 9% employee and 14% employer. The City has no obligation in connection with employee benefits offered through these plans beyond the stated above. Additional information on these retirement plans may be found in the notes to financial statements 4.A. The City provides retiring employees the opportunity to continue the City’s health and dental insurance coverage at their expense if so elected at time of retirement. At the end of the fiscal year, 49 of the City’s 128 retired employees maintained City coverage. As such, this creates an OPEB obligation to the City since premiums are not adjusted for retirees. GASB Statement 45 – Accounting and Financial Reporting for Employers for Post‐employment Benefits Other than Pensions (OPEB) was implemented in the City’s FY2009 annual financial report. This being the eighth year to recognize the impact this has on the City’s finances, the City’s unfunded liability has increased 18% from $2,670,528 to $3,148.17. This is a growing liability that will need to be addressed on how to continue to fund the recording of benefits over an employee’s working career rather than when the benefits are paid long after an employee retires as required by GASB Statement 45. The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Edmond for its Comprehensive Annual Financial Report (CAFR) for the fiscal year ended June 30, 2014. The Certificate of Achievement is a prestigious national award‐recognizing conformance with the highest standards for preparation of state and local government financial reports and the City of Edmond has been awarded a Certificate of Achievement for the last thirty consecutive years, ending June 30, 1986‐2015. With transparency and accountability critical to the City’s mission, the City also received its third consecutive Award for Outstanding Achievement in Popular Annual Financial Reporting (PAFR) called the “Citizens Report”. We believe the current report conforms to the Certificate of Achievement program requirements, and are submitting it to GFOA.

Sincerely,

Larry Stevens City Manager

Warren Porter Acting Finance Director

CITY OF EDMOND, OKLAHOMA PRINCIPAL OFFICIALS AND FINANCE COMMITTEE MEMBERS JUNE 30, 2016 ELECTED OFFICIALS Charles Lamb Victoria Caldwell Elizabeth Waner Darrell Davis Nick Massey

Mayor Councilmember-Ward 1 Councilmember-Ward 2 Councilmember-Ward 3 Councilmember-Ward 4 FINANCE COMMITTEE MEMBERS

Stephen Schaus Nick Massey Charles Lamb

Chairperson Member Member ADMINISTRATION

Larry Stevens Stephen Murdock Stephen Schaus Steve Commons

City Manager City Attorney City Treasurer Assistant City Manger Administration Assistant City Manager Operations City Clerk Fire Chief Police Chief Human Resource Director Municipal Judge

Jim Smith Kory Atcuson Doug Hall Bob Ricks Lisa Goodpasture Diane L. Slayton

ACCOUNTING AND TREASURER STAFF Ross VanderHamm Kelly Neal Sheila Briesch Terri McKay Brenda Mayer

Finance Director Assistant Finance Director Accounting Manager Payroll Manager Purchasing Manager

Solid Waste

Vehicle Maint.

Public Works Admin

Facility Maint.

Field Services

Public Works

Electric

Planning/Zoning

Engineering

Building & Fire Code Services

Water Resources

DCC

Street

Traffic Control

Water/WW Line Maint

CDBG

Water Wells

Water Plant

ECVB

Asst. to the City Ma nager

Marketing/PR

City Manager

Wastewater Treatment

Public Safety Communications & Emergency Mgmt

Municipal Judges

ACM Operations

Police

Pelican Bay

Festival Mkt Place

Cemetery

Recreation

Park Maint.

Golf

Senior Center

Arcadia Lake

Fire

Meter Services

Utility Field Services

Municipal Court

Utility Customer Service

Budget/Acct.

Administrative Services

Treasury

Purchasing

Payroll

Insurance/Benefits

Training

Oil & Gas

Code Enforcement

Financial Services

Human Resources

Community Image

Parks and Rec

ACM Administration

Boards & Commissions

Urban Forestry

Authorities & Trusts

Customer Service

Risk Management

City Attorney

Animal Welfare

Mayor & City Council

Citizens

INDEPENDENT AUDITORâ&#x20AC;&#x2122;S REPORT

INDEPENDENT AUDITOR’S REPORT

The Honorable Mayor and the Members of the City Council of the City of Edmond, Oklahoma Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City of Edmond, Oklahoma, (the “City”) as of and for the year ended June 30, 2016, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Governmental Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2016, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. 309 N. Bryant Ave. • Edmond, OK 73034 • 405.348.0615 • Fax 405.348.0931 • www.jmacpas.com 13 Member of AICPA and OSCPA

Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, budgetary comparison information, and the pension plan and other post-employment benefit schedules, as listed in the table of contents, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The introductory section, other supplementary information, and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements. The other supplementary information, as listed in the table of contents, is the responsibility of management and was derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the other supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on them. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 22, 2017, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.

March 22, 2017

MANAGEMENTâ&#x20AC;&#x2122;S DISCUSSION AND ANALYSIS

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

Our discussion and analysis of the City of Edmond’s financial performance provides an overview of the City’s financial activities for the fiscal year ended June 30, 2016. Please read it in conjunction with the City’s financial statements, which follow this section. FINANCIAL HIGHLIGHTS  For the fiscal year ended June 30, 2016, the City’s total net position increased by $56.1 million.  The City recorded derivative instruments of $1,774,843 and $680,558 in the governmental and business-type activities, respectively. The derivative instruments are offset by deferred inflows.  The City also recorded combined net pension liabilities of $51,230,280 for the year related to the Oklahoma Police Pension and Retirement System, the Oklahoma Fire Fighters Pension and Retirement System and the City’s Employee Pension and Retirement System.  During the year, the City’s expenses for governmental activities were $82.7 million and were funded by program revenues of $25.7 million and further funded with taxes and other general revenues and transfers that totaled $72.9 million.  In the City’s business-type activities, such as utilities, lake, golf course, and transportation operations; program revenues exceeded expenses by $38.6 million.  Sales and use taxes increased by $2.6 million from the prior fiscal year. This translates into an increase in taxable sales of $69 million from the prior year.  At June 30, 2016, the General Fund reported an unassigned fund balance of $3.143 million.  For budgetary reporting purposes, the General Fund and major special revenue funds reported actual revenues above estimates of $.5 million or .6%, while expenditures were under the final appropriations by $3.2 million or 5.9%. OVERVIEW OF THE FINANCIAL STATEMENTS The financial statements presented herein include all of the activities of the City of Edmond (the “City”) and its component units using the integrated approach as prescribed by GASB Statements No. 14, 34, 39, and 61. Included in this report are governmental-wide statements for each of two categories of activities – governmental and business-type, along with two discretely-presented component units. The government wide financial statements present the complete financial picture of the City from the economic resources measurement focus using the accrual basis of accounting. They present governmental activities and business type activities separately and combined. These statements include all assets of the City (including infrastructure capital assets) and deferred outflows as well as all liabilities (including all long-term debt) and deferred inflows. Reporting the City as a Whole The Statement of Net Position and the Statement of Activities One of the most frequently asked questions about the City’s finances is, “Has the City’s overall financial condition improved, declined or remained steady over the past year?” The Statement of Net Position and the Statement of Activities report information about the City as a whole and about its activities in a way that helps answer this question. These statements include all assets, deferred outflows, liabilities, and deferred inflows using the accrual basis of accounting, which is similar to the accounting used by the private-sector companies. All of the current period’s revenues and expenses are taken into account regardless of when cash is received or paid.

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

These two government-wide statements report the City’s net position and changes in them from the prior year. You can think of the City’s net position – the difference between assets, deferred outflows, liabilities, and deferred inflows – as one way to measure the City’s financial condition. Over time, increases or decreases in the City’s net position are one indicator of whether its financial health is improving, deteriorating, or remaining steady. However, you must consider other nonfinancial factors, such as changes in the City’s sales tax base, the condition of the City’s roads, and the quality of services to assess the overall health and performance of the City. As mentioned above, in the Statement of Net Position and the Statement of Activities, we divide the City into three kinds of activities: 

Governmental activities -- Most of the City’s basic services are reported here, including the police, fire, general administration, streets, and parks. Sales taxes, franchise fees, fines, and state and federal grants finance most of these activities.



Business-type activities -- The City charges a fee to customers to help cover all or most of the cost of certain services it provides. The City’s electric, water, wastewater, sanitation, lake, drainage, and golf course activities are reported here.



Discretely-presented component units – These account for activities of the City’s reporting entity that do not meet the criteria for blending, specifically the Historic Preservation Trust and the Edmond Economic Development Authority.

Reporting the City’s Most Significant Funds Fund Financial Statements The fund financial statements provide detailed information about the most significant funds – not the City as a whole. Some funds are required to be established by State law and by bond covenants. However, management establishes many other funds to help it control and manage money for particular purposes or to show that it is meeting legal responsibilities for using certain taxes, grants and other money. The City’s three fund categories-governmental, and proprietary, and fiduciary use different accounting approaches. Governmental funds - Most of the City’s basic services are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end that are available for spending. These funds are reported using an accounting method called modified accrual accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the City’s general government operations and the basic service it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance the City’s programs. We illustrate the relationship (or differences) between governmental activities (reported in the Statement of Net Position and the Statement of Activities) and the governmental funds with reconciliation at the bottom of the fund financial statements. Proprietary funds - When the City charges customers for the services it provides – whether to outside customers or to other units of the City – these services are generally reported in proprietary funds. Proprietary funds are reported in the same way that all activities are reported in the Statement of Net Position, the Statement of Revenues, Expenses and Changes in Fund Net Position and Statement of Cash

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

Flows. In fact, the City’s enterprise funds are the essentially the same as the business-type activities we report in the government-wide statements but provide more detail and additional information, such as cash flows.

Fiduciary funds - When the City is responsible for assets that – because of a trust arrangement or other fiduciary requirement – can be used only for trust beneficiaries or others parties, these activities are reported as fiduciary funds, such as the Employee Retirement Trust Fund. The City is responsible for ensuring that the assets reported in these funds are used for their intended purpose. All of the City’s fiduciary activities are reported in a separate statement of fiduciary net position and a statement of changes in fiduciary net position. We exclude these activities from the City’s government-wide financial statements because the City cannot use these assets to finance operations. A FINANCIAL ANALYSIS OF THE CITY AS A WHOLE Net Position As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the City, assets and deferred outflows exceeded liabilities and deferred inflows by $600,605,174 at the close of the most recent fiscal year. TABLE 1 NET POSITION (In Thousands)

Governmental Activities 2016

2015

Current assets Capital assets, net Other non‐current assets Total assets

$ 95,399 313,579 9,801 418,779

$ 104,320 299,578 10,871 414,769

Deferred Outflows

9,670

6,690

Current liabilities Non‐current liabilities Total liabilities

27,430 108,194 135,624

28,822 107,666 136,488

Deferred Inflows

5,808

Net position Net investment in capital assets Restricted Unrestricted (deficit) Total net position

% Inc. (Dec.)

Business‐Type Activities 2016

2015

$ 141,103 232,725 4,068 377,896

$ 110,575 224,864 4,109 339,548

2,612

1,578

‐5% 0% ‐1%

20,384 45,830 66,214

16,470 49,625 66,095

13,816

‐58%

706

255,087 62,143 (30,213)

250,996 72,919 (52,759)

2% ‐15% ‐43%

$ 287,017

$ 271,156

‐9% 5% ‐10% 1%

% Inc. (Dec.)

Total 2016

2015

$ 236,502 546,304 13,869 796,675

$ 214,895 524,442 14,980 754,317

12,282

8,268

24% ‐8% 0%

47,814 154,024 201,838

45,292 157,291 202,583

6% ‐2% 0%

1,643

‐57%

6,514

15,459

‐58%

186,486 11,122 115,980

178,129 10,164 85,095

5% 9% 36%

441,573 73,265 85,767

429,125 83,083 32,336

3% ‐12% 165%

$ 313,588

$ 273,388

15%

$ 600,605

$ 544,544

10%

28% 3% ‐1% 11%

10% 4% ‐7% 6%

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

Net Position (in Thousands) $350,000 $313,588 $294,918 $273,388 $273,750 $287,017 $271,156 $248,599 $241,069 $244,283 $229,461 $229,167 $235,828 $221,573 $214,648 $206,411 $202,648 $201,953 $192,594 $184,814 $179,385 $173,245

$300,000 $250,000 $200,000 $150,000

$139,959

$100,000 2006

2007

2008

2009

2010

2011

Governmental

2012

2013

2014

2015

2016

Business Type

The largest portion of the City’s net position reflects its net investment in capital assets (e.g., land, buildings, machinery, and equipment); less any related debt used to acquire those assets that is still outstanding. For 2016, this investment in capital assets, net of related debt amounted to $441,572,979. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. A major portion of the City’s net position, $73,265,628, also represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position, $85,766,580, may be used to meet the government’s ongoing obligations to citizens and creditors. At the end of the current fiscal year, the City is able to report positive balances in all categories of net position, both for the government as a whole, as well as for its separate governmental and business-type activities. Changes in Net Position For the year ended June 30, 2016, net position of the primary government changed as follows:

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

TABLE 2 CHANGES IN NET POSITION (In Thousands)

Governmental Activities 2016

2015

$ 9,504 6,040 10,190

$ 10,588 5,867 10,227

70,528 1,061 933 1,016

Total Revenues

% Inc. (Dec.)

Business‐Type Activities 2016

2015

‐10% 3% 0%

$ 144,829 309 6,493

$ 136,963 259 8,610

70,046 1,158 815 728

1% ‐8% 14% 40%

‐ ‐ 917 ‐

99,272

99,429

Expenses General Government Public Safety Streets & highways Culture, parks and recreation Health and welfare Economic development Interest on long‐term debt Electric Water Wastewater Sanitation Lake Drainage Golf Course Cooperative purchasing service Transportation operations

9,167 47,309 15,152 7,068 1,639 577 1,829 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

6,284 43,371 13,111 8,532 1,510 644 1,527 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

46% 9% 16% ‐17% 9% ‐10% 20%

Total Expenses Excess (deficiency) before transfers Transfers Increase in net position Beginning net position Ending net position

82,741 16,531 (670) 15,861 271,156 $ 287,017

74,979 24,450 501 24,951 246,205 $ 271,156

10% ‐32% ‐234% ‐36%

Revenues Program revenue: Charges for service Operating grants and contributions Capital grants and contributions General Revenue: Taxes Intergovernmental revenue Investment income Miscellaneous

% Inc. (Dec.)

Total 2016

2015

6% 19% ‐25%

$ 154,333 6,349 16,683

$ 147,551 6,126 18,837

5% 4% ‐11%

‐ ‐ 659 171

0% 0% 39% ‐100%

70,528 1,061 1,850 1,016

70,046 1,158 1,474 899

1% ‐8% 26% 13%

152,548

146,662

251,820

246,091

‐ ‐ ‐ ‐ ‐ ‐ ‐ 75,313 17,495 7,224 7,052 1,365 903 2,319 50 1,297

‐ ‐ ‐ ‐ ‐ ‐ ‐ 75,458 19,839 7,139 6,876 1,351 917 2,079 63 1,594

0% ‐12% 1% 3% 1% ‐2% 12% ‐21% ‐19%

9,167 47,309 15,152 7,068 1,639 577 1,829 75,313 17,495 7,224 7,052 1,365 903 2,319 50 1,297

6,284 43,371 13,111 8,532 1,510 644 1,527 75,458 19,839 7,139 6,876 1,351 917 2,079 63 1,594

46% 9% 16% ‐17% 9% ‐10% 20% 0% ‐12% 1% 3% 1% ‐2% 12% ‐21% ‐19%

113,018 39,530 670 40,200 273,388 $ 313,588

115,316 31,346 (501) 30,845 242,543 $ 273,388

195,759 56,061 ‐ 56,061 544,544 $ 600,605

190,295 55,796 ‐ 55,796 488,748 $ 544,544

3% 0%

‐2% 26% ‐234% 30%

‐ 0%

The City’s governmental activities’ increase in net position of $15.9 million represents an 36% decrease from the prior year’s change in net position and is primarily the result of increased expenses related to pension expense. The business-type activities’ increase in net position of $40.2 million represents a 30% increase from the prior year’s change in net position which is largely attributable to the increase increased rates fees and less transfers out along with expenses staying in line with prior year. The results indicate the City, as a whole, increased in total net position of $56.1 million is a combination of overall expenses staying relatively in line with revenue collections. Governmental Activities To aid in the understanding of the Statement of Activities some additional explanation is given. Of particular interest is the format that is significantly different than a typical Statement of Revenues, Expenses, and Changes in Fund Balance. You will notice that expenses are listed in the first column with revenues from that particular program reported to the right. The result is a Net (Expense)/Revenue. The reason for this kind of format is to highlight the relative financial burden of each of the functions on the City’s taxpayers. It also identifies how much each function draws from the general revenues or if it is selffinancing through fees and grants or contributions. All other governmental revenues are reported as general. It is important to note all taxes are classified as general revenue even if restricted for a specific purpose.

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

For the year ended June 30, 2016, the City’s governmental activities were funded as follows:

Governmental Activities Sources 3%

16%

Sales Tax Other Taxes

10%

Charges for Service Grants

68%

Other

Governmental Activities Uses 3% 2% Public Safety General Government

18%

Culture, parks and recreation 9%

57% 11%

Streets and Highways Health and Welfare Interest on Long‐Term Debt

For the year ended June 30, 2016, total expenses for governmental activities amounted to $82.7 million. Of these total expenses, taxes and other general revenues funded $73.5 million, while those directly benefiting from the program funded $16.2 million in grants and other contributions and $9.5 million from charges for services. Besides the aforementioned increase in sales tax other notable changes for governmental activities include an increase in expenses related to pension expense.

Governmental-type Activities

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

TABLE 3 Net Revenue (Expense) of Governmental Activities (In Thousands) Net Revenue (Expense) % Inc. Total Expense of Services of Services (Dec.) 2016 2015 2016 2015 General Government $ 9,167 $ 6,285 46% $ (1,456) $ 1,661 Public Safety 47,309 43,371 9% (41,308) (37,949) Streets & Highways 15,152 13,111 16% (4,214) (1,478) Culture, parks and recreation 7,068 8,532 ‐17% (6,854) (8,051) Health and Welfare 1,639 1,511 8% (769) (593) Economic Development 577 644 ‐10% (577) (360) Interest on long‐term debt 1,829 1,527 20% (1,829) (1,527) TOTAL

$ 82,741

$ 74,981

10%

$ (57,007)

$ (48,297)

% Inc. (Dec.) ‐188% 9% 185% ‐15% 30% 60% 20% 18%

Business-type Activities TABLE 4 Net Revenue (Expense) of Business‐Type Activities (In Thousands) Net Revenue (Expense) of % Inc. Total Expense of Services Services (Dec.) 2016 2015 2016 2015 Electric $ 75,313 $ 75,458 0% $ 16,936 $ 12,311 Water 17,495 19,839 ‐12% 10,737 7,287 Wastewater 7,224 7,139 1% 9,011 9,249 Sanitation 7,052 6,876 3% 2,076 2,080 Lake 1,365 1,351 1% (286) (409) Drainage 903 916 ‐1% 973 1,148 Golf 2,319 2,079 12% (284) (55) Cooperative purchasing services 50 64 ‐22% 14 26 Transportation 1,297 1,594 ‐19% (564) (1,122)

TOTAL

$ 113,018

$ 115,316

‐2%

$ 38,613

$ 30,515

% Inc. (Dec.) 38% 47% ‐3% 0% ‐30% ‐15% 416% ‐46% ‐50%

27%

The City’s business-type activities include utility services, lake and golf course operations, the cooperative purchasing program and operations of the transit system. In reviewing the business-type activities net (expense)/revenue, the following highlights should be noted: 

Total business-type activities reported net revenues of $38.6 million for the year ended June 30, 2016.

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

 

All individual activities reported net revenue for the year ended June 30, 2016 with the exception of lake, golf and transportation operations. Significant increases in net revenue were recognized in the electric, water, and wastewater operations due to increased rates in electric and water, a delay in capital projects, and management of operating expenses.

A FINANCIAL ANALYSIS OF THE CITY’S FUNDS As the City completed its 2016 fiscal year, the governmental funds reported a combined fund balance of $70.27 million or a 9.6% decrease from 2015. The enterprise funds reported combined net position of $305.8 million or a 14.8% increase from 2015. The fund balance constraints and net position restrictions are listed below: Governmental Funds: Fund Balance: Restricted

Committed

62,131,249 8,902

Assigned

6,988,723

Unassigned

1,143,526 Total Fund Balance Constraints

70,272,400

11,122,065

Enterprise Funds: Net Position Restrictions: Restricted for debt service

Restricted for scholarships

11,120,764 1,301

Total Enterprise Fund Net Position Restrictions

Other fund highlights include:  For the year ended June 30, 2016, the General Fund’s total fund balance decreased by $3,966,012 due to increased expenditures associated with street projects and the transfers out to the Police and Fire Fund as required by ordinance.  The 2000 Capital Improvement Tax Fund’s total fund balance decreased by $2,764,571 due to reduced intergovernmental revenues and an increased interfund transfers out.  The Fire Public Safety Limited Tax Fund’s total fund balance increased by $630,129 due to an increase in fire sales tax collections and transfers from the General Fund.  The Police Public Safety Limited Tax Fund’s total fund balance decreased by $202,326 due to an increase in police sales tax collections and transfers from the General Fund.  All enterprise funds reported an increase in net position, after transfers, for the year ended June 30, 2016 with the exception of golf. In each of the funds mentioned above, charges for services did cover operational cost with the exception of Lake, Golf and City Link Operations.  The employee pension trust fund posted a decrease in net position of the fund of $1.0 million. The decrease is due to a decline in the investment yields in the market and increased benefits paid out to retirees.

General Fund Budgetary Highlights

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

Over the course of the year, the City Council revised the General Fund budget various times. The revised budget included an increase in overall revenue projections of 24% or $12,683,815 due to transfers in. Actual revenues and transfers were above final estimates by $21,286 or .03% which was a result of an increase in transfers in, while expenditures were under final appropriations by $886,092 or 1.3% which is mainly due to reduced operating expenses in general and parks. CAPITAL ASSET AND DEBT ADMINISTRATION Capital Assets At the end of June 30, 2016, the City had $546 million invested in capital assets, net of depreciation, including police and fire equipment, buildings, park facilities, water lines and sewer lines. (See table below). This represents a net increase of $21.9 million or 4.17% over last year. TABLE 5 Primary Government Capital Assets (In Thousands) (Net of accumulated depreciation) Governmental Activities

Business‐Type Activities

Total

Land Buildings Imp. Other than buildings Equipment Intangible water rights Utility property Infrastructure Construction in progress

2016 $ 15,208 89,469 12,642 23,895 ‐ ‐ 147,510 24,855

2015 $ 15,208 57,996 13,038 22,282 ‐ ‐ 141,207 49,846

2016 $ 2,351 21,366 5,934 3,679 14,194 166,438 ‐ 18,762

2015 $ 2,351 22,203 5,244 4,212 14,838 167,020 ‐ 8,996

2016 $ 17,559 110,835 18,576 27,574 14,194 166,438 147,510 43,617

2015 $ 17,559 80,199 18,282 26,494 14,838 167,020 141,207 58,842

Totals

$ 313,579

$ 299,577

$ 232,724

$ 224,864

$ 546,303

$ 524,441

This year’s more significant capital asset additions included: $16.0 million in Street improvement projects $1.4 million in Park improvements $3.6 million in Water Utility improvements $2.8 million in Wastewater Utility improvements $3.3 million in Electric Utility improvements $34.2 million Public Safety improvements See Note 3.D. to the financial statements for more detail information on the City’s capital assets and changes therein.

Long- Term Debt

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

At year-end, the City had $104 million in long-term debt outstanding which represents a $9.0 million or 8% decrease from the prior year. The City’s changes in long-term debt by type of debt are as follows: Primary Government Long‐Term Debt (In Thousands)

Governmental Activities

Business‐Type Activities

Total Percentage Change

Total

2016

2015

2016

2015

2016

2015

Accrued absences Revenue bonds Notes payable Capital lease

$ 3,610 55,788 ‐ ‐

$ 3,299 62,153 ‐ ‐

$ 719 28,717 14,999 39

$ 656 30,444 16,275 ‐

$ 4,329 84,505 14,999 39

$ 3,955 92,597 16,275 ‐

9% ‐9% ‐8%

Totals

$ 59,398

$ 65,452

$ 44,474

$ 47,375

$ 103,872

$ 112,827

‐8%

See Note 3.E. to the financial statements for more detail information on the City’s long-term debt and changes therein. ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES State of Oklahoma – Conditions/Projections Oklahoma State Treasurer Ken Miller’s January 2017 Economic Report noted the following:    

Year-to-date allocations to Oklahoma’s General Revenue Fund (GRF) are below the estimate by $66 million, or 2.7%. Through December 2016, two of the GRF’s four major revenue streams – net income tax and gross production tax – exceed the estimate. Combined, these income tax and production tax exceeded estimate by $17.5 million. The primary reason for the underperformance of revenue to the GRF is the sales tax. Allocations for the first six months of the fiscal year are below the estimate by $63 million, or 6.4%. Motor vehicle collections are also below the estimate by $5.1 million, or 5%.

Projections presented to the State Board of Equalization in December 2016 show GRF allocations for the full FY-17 are expected to fail to meet the official estimate by $231.4 million, or 4.4%. December Gross Receipts to the Treasury totaled $901.8 million, while the GRF, as reported by the Office of Management and Enterprise Services, received $419.6 million, or 46.5% of the total. The GRF received between 29.7% and 52.8% of monthly gross receipts during the past 12 months.

From December gross receipts, the GRF received:      

Individual income tax: Sales tax: Gross production – Gas: Gross production – Oil: Motor vehicle tax: Other Sources:

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

66.3% 44.0% 65.8% 10.5% 27.0% 41.4%

December insurance premium taxes totaled $57.7 million, an increase of $6.7 million, or 13.1% over prior year. Tribal gaming fees generated $10.9 million during the month, down by 3.8% from December 2015. Oklahoma unemployment rate shrinks in December 2016 Oklahoma’s seasonally adjusted unemployment rank shrank by 0.1% in December 2016, but still remains above the U.S. jobless rate, according to the Oklahoma Employment Security Commission. The December 2016 rate for unemployment was at its lowest rate since July 2016. Additionally, total employment was higher and the number of unemployed was lower than any month since July 2016. Oklahoma Economic Indicators      

Energy. After dropping in February 2016 to near $26/barrel for crude oil and $2.60/MCF natural gas, benchmark prices on December 28, 2016, had risen to $53 + for crude oil and $3.80 for natural gas. Energy. For eight consecutive months, through January 2017, the active oil rig count has stayed the same or increased. Energy. January 2017 active natural gas rig count is at its highest count in eleven months. Employment. Oklahoma County, home of Edmond, unemployment rate was 4.2% in November 2016. Leading Indicators. Federal Reserve Bank leading index for Oklahoma was at its highest rate since January 2015, at 0.91%. Regional indicator. Mid-America Business Conditions, released December 28, 2016, suggested economic conditions are improving in 9 Midwest/Plains states, including Oklahoma. Overall economic index for region jumped to 53.1 in December 2016; from 46.5 in November 2016 and 43.8 in October 2016. A number greater than 50 suggests economic growth; anything less than 50 suggests a decline.

City of Edmond Economic Highlights: Local Sales Tax The City continued to improve its financial condition in its main general revenue source – sales tax. Although establishing another record high collection year, the City’s collections rose by 0.69% from the previous fiscal year for FY15-16. This was the slowest percentage rise since FY09-10. For FY16-17, the City budgeted 0% increase in sales tax collections.

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

For the first six months of FY16-17, the City is behind the pace for collections from the previous year. July

Aug.

Sept.

Oct.

Nov.

Dec.

FY15-16 Actuals

$2,808,970 3,107,144 2,875,008 2,992,822 2,855,332 2,801,446

FY16-17 Actuals

$2,850,337 2,797,317 2,878,584 2,908,956 2,807,417 2,831,641

FY16-17 Actuals Compared To FY15-16

$41,367 (309,827)

$3,576

(83,866) (47,915)

$30,195

City of Edmond’s FY16-17 Budget The FY16-17 Budget totals $297,708,897, an increase of about 18% ($45 million) which is primarily the result of increased capital expenditures in Water and Wastewater Utility improvements. The City of Edmond begins Phase I of an approximately $300 million in capital improvements to its environmental utilities.

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016

Highlights Include: 

The three sales taxes approved by voters in 2000 continue to provide base revenue for both Public Safety (police and fire) and capital projects. The Fire Department receives a quarter-cent tax, the Police Department, a one-eight cent tax and a three-quarter cent tax is allocated for capital improvements. The net result is almost two-thirds of General Fund revenue is automatically allocated to fire and police operations.



Edmond total sales tax rate remains at 8.25%. This rate is comprised of 3.75% in local taxes and a 4.5% state tax that is charged to all cities. Of the four largest cities in the Oklahoma City metro area, Edmond has the lowest combined sales tax rate.



In April 2016, voters approved two sales tax extensions through March 31, 2027. The one percent General Fund Sales Tax Extension was approved by 80% of the vote. The one-half percent Public Safety Center tax was set to expire March 31, 2017. The voters approved by 73% of the vote an extension of the tax for Capital Improvements. The City Council created a Capital Improvements Advisory Tax Force to examine the funding of major capital projects from this fund.

2000 Capital Improvement Sales Tax Fund 

This fund continues to provide the primary financing for capital improvements in Edmond. This ¾ cent tax was initially approved by voters in 1996 and indefinitely extended in 2000.



Construction began on the Spring Creek Trail from I-35 to Spring Creek Park at Arcadia Lake. This is the first phase of a significant regional trail project that will also receive significant funding from private funding and state grants.



Road improvements on Covell, from Fairfax Boulevard to I-35, should be completed by summer 2017. This project includes funding from Oklahoma Department of Transportation (ODOT). This project complements the interchange improvements as part of a major economic development project associated with the development of a Hotel/Conference Center (HCC).



The development of the two northern corners of I-35 & Covell represents the most significant City involvement in an economic development project. The City has committed $11 million from this fund for the purchase of land for the HCC on the northwest corner ($2.2 million), the purchase of land for a proposed Indoor Sports Complex on the northeast corner ($2 million), infrastructure improvements to serve development on the west side of the interchange ($2 million), and funding assistance for the construction HCC ($4.8 million). The HCC is under construction with an estimated opening in December 2017. The executed development agreements provide for the City to be repaid $9 million of the $11 million investment in 15 years as the developers buy out the City’s interest in the land and the conference center improvements. Additional projects for the area include a proposed entertainment complex, with a preliminary term sheet approved by the Edmond City Council.

CITY OF EDMOND, OKLAHOMA MANAGEMENT’S DISCUSSION & ANALYSIS June 30, 2016



The development of an Intelligent Traffic System (ITS) continues to be an important multi-year capital program, which features improved traffic control equipment at local intersections. The system features continuous communication with a central computer system which allows the traffic signal system to be adjusted in real time to meet specific traffic issues as they arise. The first improvement corridor project completed was along 2nd Street/Edmond Road, from Santa Fe on the west to Boulevard on the east. ODOT funds provided major financial assistance in funding ITS improvements. Design is completed for the next phase, which includes incorporating signals along Broadway.



Results from the previous biennial citizen surveys indicate that traffic issues is the community’s biggest concern. One project has been completed and two additional projects will be completed in 2017. Completed in 2016, with the financial assistance from ODOT, was the turn lane addition at 33rd and Broadway. Construction will be completed in 2017 for additional turn lanes at both Santa Fe and Bryant on Covell.



In FY16-17, Edmond will complete approximately $1.3 million in roadway resurfacing and rehabilitation activities.

CONTACTING THE CITY’S FINANCIAL MANAGEMENT TEAM This financial report is designed to provide our citizens, customers and creditors with a general overview of the City’s finances and to show the City’s accountability for the money it receives. If you have questions about this report or need additional information, contact the Finance office at 7 N. Broadway, P.O. Box 2970, Edmond, OK 73083-2970 or call 405-359-4521.

BASIC FINANCIAL STATEMENTS

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Statement of Net Position June 30, 2016 Primary Government Governmental Activities ASSETS Current Assets: Cash and equivalents Investments Restricted assets: Cash and equivalents Investments Accrued interest receivable Accounts receivable, net of allowance Internal Balances Notes receivable Due from other governments Inventory Total Current Assets Non-current Assets: Restricted assets: Cash and equivalents Investments Derivative instruments Capital Assets: Non-depreciable Depreciable, net of depreciation Total Non-current Assets

9,202,411 69,102,489

Business-type Activities

8,543,812 3,242,517 151,650 1,763,792 (7,813,421) 10,307,559 898,464 95,399,273

Total Assets DEFERRED OUTFLOWS OF RESOURCES Deferred charge on refunding Deferred amounts related to pension Total deferred outflow of resources LIABILITIES Current Liabilities: Accounts payable and other accrued expenses Accrued interest payable Amounts held in escrow Matured revenue bonds payable Meter deposit liability Unearned revenue Current portion: Capital lease obligations Notes payable Revenue bonds payable Compensated absences Estimated liability for claims Total Current Liabilities Non-current Liabilities: Compensated absences Net OPEB obligation Net pension liability Capital lease obligations Revenue bonds payable, net Notes payable Claims and judgments Total Non-current Liabilities Total Liabilities DEFERRED INFLOWS Accumulated increase in fair value of hedging derivatives Deferred amounts related to pensions Total deferred inflow of resources

10,361,841 88,490,303

Component Units Historic Economic Preservation Development Trust Authority

Total

19,564,252 157,592,792

92,010 -

288,734 -

8,145,827 4,299,507 203,390 19,256,448 7,813,421 289,890 2,242,706 141,103,333

16,689,639 7,542,024 355,040 21,020,240 10,597,449 3,141,170 236,502,606

92,010

41,250 1,022 159,905 490,911

1,575,241 6,480,650 1,744,843

1,302,774 2,085,042 680,558

2,878,015 8,565,692 2,425,401

40,062,861 273,516,066 323,379,661

21,112,584 211,611,876 236,792,834

61,175,445 485,127,942 560,172,495

100,450 94,780 195,230

9,928 9,928

418,778,934

377,896,167

796,675,101

287,240

500,839

1,223,183 8,446,478 9,669,661

704,868 1,907,045 2,611,913

1,928,051 10,353,523 12,281,574

78,667 78,667

5,720,763 1,039,441 519,166 6,499,851 5,680,049

9,812,001 598,126 4,138,921 -

15,532,764 1,637,567 519,166 6,499,851 4,138,921 5,680,049

6,541 -

6,529,309 360,951 1,080,140 27,429,670

6,321 1,311,102 4,445,695 71,900 20,384,066

6,321 1,311,102 10,975,004 432,851 1,080,140 47,813,736

3,178 9,719

3,248,555 2,451,730 47,464,225 53,186,299 1,843,046 108,193,855

647,012 696,450 3,766,055 32,692 26,999,547 13,688,263 45,830,019

3,895,567 3,148,180 51,230,280 32,692 80,185,846 13,688,263 1,843,046 154,023,874

28,606 156,709 185,315

135,623,525

66,214,085

201,837,610

195,034

1,744,843 4,063,488 5,808,331

680,558 24,989 705,547

2,425,401 4,088,477 6,513,878

1,193 1,193

255,086,502

186,486,477

441,572,979

195,230

9,928

8,756,752 687,438 52,699,373 (30,213,326) 287,016,739

11,122,065 115,979,906 313,588,448

8,756,752 687,438 63,821,438 85,766,580 600,605,187

92,010 287,240

41,250 332,101 383,279

NET POSITION Net investment in capital assets Restricted by: Enabling legislation Statutory requirements External contracts Unrestricted (deficit) Total Net Position

See accompanying notes to the basic financial statements.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Statement of Activities For the Year Ended June 30, 2016

Functions/Programs Primary government Governmental Activities General government Public safety Streets and highways Cultural, parks and recreation Health and welfare Economic Development Interest on long-term debt Total governmental activities

Business-type activities Electric operations Water operations Wastewater operations Sanitation operations Lake operations Drainage operations Golf course operations Cooperative purchasing services Transportation operations Total business-type activities Total primary government Component Units Cultural, parks and recreation Economic development Total component units

Charges for Services

Expenses

9,167,431 47,309,195 15,151,636 7,067,735 1,639,425 576,728 1,828,757 82,740,907

75,312,602 17,495,184 7,224,538 7,052,119 1,364,701 903,578 2,318,656 50,083 1,296,604 113,018,065

7,259,773 1,188,473 23,422 161,863 869,997 9,503,528

Program Revenue Operating Grants and Contributions

91,957,403 25,066,076 13,377,584 9,128,560 1,078,431 1,876,533 2,018,439 63,524 262,869 144,829,419

376,998 4,812,946 813,389 37,068 6,040,401

Capital Grants and Contributions

Governmental Activities

291,520 1,108 16,315 308,943

75,000 10,100,390 14,220 10,189,610

(57,007,368)

195,758,972

154,332,947

6,349,344

16,682,258

53,089 705,789 758,878

162,305 162,305

(1,455,660) (41,307,776) (4,214,435) (6,854,584) (769,428) (576,728) (1,828,757) (57,007,368)

3,165,827 2,857,339 469,482 6,492,648

$ $

Net (Expense) Revenue and Changes in Net Position Primary Government Component Units Historic Economic Business-type Preservation Development Activities Total Trust Authority

General revenues: Taxes: Sales and use taxes Sales and use taxes - Restricted for public safety Sales and use taxes - Restricted for park and recreation Sales and use taxes - Restricted for capital improvements Hotel/motel taxes Franchise taxes Payment from City of Edmond Grants and contributions not restricted to specific programs Unrestricted investment earnings Miscellaneous Transfers Total general revenues and transfers Change in net position Net position - beginning

38,186,535 6,341,907 2,113,969 21,139,690 464,362 2,281,490 1,060,789 933,373 1,015,926 (669,672) 72,868,369 15,861,001 271,155,738

Net position - ending

287,016,739

See accompanying notes to the basic financial statements.

16,936,321 10,736,719 9,011,493 2,076,441 (286,270) 972,955 (283,902) 13,441 (564,253) 38,612,945

38,612,945

(18,394,423)

917,706 669,672 1,587,378 40,200,323 273,388,125 $

(1,455,660) (41,307,776) (4,214,435) (6,854,584) (769,428) (576,728) (1,828,757) (57,007,368)

313,588,448

600,605,187

38,186,535 6,341,907 2,113,969 21,139,690 464,362 2,281,490 1,060,789 1,851,079 1,015,926 74,455,747 56,061,324 544,543,863 $

(53,089) (53,089)

(543,484) (543,484)

25,005 146 2,500 27,651 (25,438) 312,678

576,728 4,893 581,621 38,137 345,142

287,240

383,279

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Balance Sheet Governmental Funds June 30, 2016

General Fund ASSETS Cash and cash equivalents Investments Due from other funds Due from other governments Accrued interest receivable Other receivables Interfund loan receivable Total assets

LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Due to other funds Interfund loan payable Unearned revenue Matured interest payable Matured revenue bonds payable Amounts held in escrow Total liabilities

DEFERRED INFLOWS OF RESOURCES Unavailable revenue Total deferred inflows of resources Fund balances: Restricted Committed Assigned Unassigned Total fund balances Total liabilities and fund balances

211,034 2,021,539 85,708 5,684,907 4,436 1,132,882 9,140,506

774,098 18,112 197,070 519,166 1,508,446

Police Public Safety Limited Tax Fund

Fire Public Safety Limited Tax Fund $

1,188,591 10,588,174 611,477 23,236 12,411,478

520,005 520,005

769,286 7,105,817 343,624 15,594 1,808 8,236,129

612,582 612,582

2000 Capital Improvement Tax Fund $

12,093,139 27,308,206 1,834,432 38,592 41,274,369

1,616,489 1,039,441 6,499,851 9,155,781

479,070 479,070

13,865 13,865

21,619 21,619

23,027 23,027

2,889,481 1,120,870 3,142,639 7,152,990 9,140,506

11,247,640 629,968 11,877,608 12,411,478

6,771,548 830,380 7,601,928 8,236,129

29,253,300 2,842,261 32,095,561 41,274,369

See accompanying notes to the basic financial statements.

2012 Public Safety Center Tax Fund $

411,692 3,663,344 1,222,955 8,040 5,306,031

418,384 6,881,060 7,299,444

Other Governmental Funds $

4,797 4,797

(1,998,210) (1,998,210) 5,306,031

Total Governmental Funds

1,860,728 4,667,354 392,937 10,243 237,676 6,881,060 14,049,998

413,403 87,961 501,364

6,111 6,111

11,969,280 8,902 1,565,244 (903) 13,542,523 14,049,998

16,534,470 55,354,434 85,708 10,090,332 100,141 1,372,366 6,881,060 90,418,511

4,354,961 106,073 6,881,060 197,070 1,039,441 6,499,851 519,166 19,597,622

548,489 548,489

62,131,249 8,902 6,988,723 1,143,526 70,272,400 90,418,511

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position June 30, 2016 Total fund balance, governmental funds

70,272,400

Amounts reported for governmental activities in the Statement of Net Position are different because: Capital assets used in governmental activities are not current financial resources and therefore are not reported in the funds, net of accumulated depreciation of $211,054,730

295,978,081

Certain other long-term assets are not available to pay current fund liabilities and therefore they, along with deferred outflows, are deferred in the funds: Accrued interest receivable Other receivables, net of allowance Receivable from other governments Pension related deferred outflows

59,751 476,423 12,314 5,140,865

Certain long-term liabilities are not due and payable from current financial resources and therefore they, along with deferred inflows, are not reported in the funds: Revenue bonds payable Accrued compensated absences Deferred amount on refunding Unamortized debt premium Net pension liability Pension related deferred inflows Net OPEB obligation Advance Deferred amount related to derivative instrument

(55,788,256) (2,609,352) 1,223,183 (3,927,352) (40,883,824) (4,052,678) (2,133,215) (5,482,979) 1,744,843

Accumulated increase in fair value of hedging derivatives is a deferred inflow

(1,744,843)

Internal service funds are used by management to charge costs of certain activities that benefit multiple funds, such as self-insurance, vehicle maintenance, and other such costs, to individual funds. The assets and liabilities of certain of these internal service funds are reported in governmental activities in the Statement of Net Position: Internal service funds' net position Internal service fund interfund balance resulting from net revenues reported in business-type activities

Net Position of Governmental Activities in the Statement of Net Assets

36,542,546 (7,811,168)

See accompanying notes to the basic financial statements.

287,016,739

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds For the Year Ended June 30, 2016

General Fund REVENUES Sales and use taxes Franchise and public service taxes Hotel/motel taxes Intergovernmental Charges for services Fines and forfeitures Licenses and permits Investment income Investment earnings on interfund loans Miscellaneous Total revenues

EXPENDITURES Current: General government Public safety Health and sanitation Culture, parks and recreation Economic development Streets and highways Debt Service: Principal Interest and other charges Capital Outlay Total Expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending

38,186,535 2,281,490 1,982,590 5,397,480 1,641,283 1,412,552 73,131 243,355 51,218,416

Fire Public Safety Limited Tax Fund $

4,227,938 3,699,634 12,042 98,539 59,093 8,097,246

Police Public Safety Limited Tax Fund $

2,113,969 1,393,242 69,311 340,558 3,917,080

2000 Capital Improvement Tax Fund $

12,683,814 524,946 496,341 13,705,101

2012 Public Safety Center Tax Fund $

8,455,876 34,579 8,490,455

Other Governmental Funds

Total Governmental Funds

2,113,969 464,362 375,377 901,758 44,800 85,876 349,580 4,335,722

67,782,101 2,281,490 464,362 7,450,843 6,311,280 1,641,283 1,412,552 845,306 85,876 1,488,927 89,764,020

5,252,037 2,988,821 647,276 3,609,872 576,728 6,354,224 937,712 20,366,670

22,087,375 -

22,603,392 -

108,302 -

1,470,796 -

577,196 31,756 737,401 1,086,260 -

5,937,535 49,182,140 1,384,677 4,696,132 576,728 6,354,224

587,226 22,674,601

170,528 22,773,920

6,364,851 2,078,883 12,617,636 21,169,672

85,876 4,263,492 5,820,164

1,347,859 3,780,472

6,364,851 2,164,759 19,924,453 96,585,499

30,851,746

(14,577,355)

(18,856,840)

(7,464,571)

2,670,291

555,250

(6,821,479)

13,765,341 (48,583,099) (34,817,758) (3,966,012)

15,207,484 15,207,484 630,129

18,654,514 18,654,514 (202,326)

4,700,000 4,700,000 (2,764,571)

(4,700,000) (4,700,000) (2,029,709)

346,217 (60,129) 286,088 841,338

52,673,556 (53,343,228) (669,672) (7,491,151)

11,119,002

11,247,479

7,804,254

34,860,132

7,152,990

11,877,608

7,601,928

32,095,561

See accompanying notes to the basic financial statements.

31,499 $

(1,998,210)

12,701,185 $

13,542,523

77,763,551 $

70,272,400

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities For the Year Ended June 30, 2016

Net change in fund balances - total governmental funds:

(7,491,151)

Amounts reported for Governmental Activities in the Statement of Activities are different because: Governmental funds report capital outlays as expenditures while governmental activities report depreciation expense to allocate those expenditures over the life of the assets: Capital asset purchases capitalized Capital assets donated Depreciation expense Disposal of capital assets

19,621,586 9,667,250 (14,934,642) (4,110)

In the Statement of Activities, the cost of pension benefits earned net of employee contributions is reported as an element of pension expense. The fund financial statements report pension contributions as expenditures.

3,374,481

Governmental funds report bond issuance costs as expenditures and bond premiums as revenue while governmental activities report amortization and interest expense to allocate those expenditures over the term of the bonds: Amortization expense Interest expense

(165,454) 501,456

Revenues in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds: Advance Grants Court Interest

311,830 (24,758) 26,792 2,191

Bond proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the Statement of Net Position. Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the Statement of Net Position: Revenue bond principal payment

6,364,851

Some expenses reported in the statement of activities do not require the use of current financial resources and these are not reported as expenditures in governmental funds: Accrued compensated absences change Net OPEB obligation change

(267,955) (204,822)

Internal service fund activity is reported as a proprietary fund in the fund financial statements, but certain net revenues are reported in governmental activities on the statement of Activities: Total change in net position for internal service funds Net revenues of internal service funds reported in business-type activities

(139,123) (777,421)

Change in net position of governmental activities

15,861,001

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Statement of Net Position Proprietary Funds June 30, 2016 Edmond Public Works Authority (EPWA) Enterprise Funds

Electric Fund ASSETS Current assets: Cash and cash equivalents $ Investments Restricted assets: Cash and cash equivalents Investments Receivables: Accrued interest receivable Utility billing, net of allowance for uncollectible accounts Due from other governments Other receivables Due from other funds Inventories Total current assets Non-current assets: Restricted assets: Cash and cash equivalents Investments Derivative instruments Capital Assets: Nondepreciable Depreciable, net of accumulated depreciation Total non-current assets Total assets DEFERRED OUTFLOWS OF RESOURCES Deferred charge on refunding Deferred amounts related to pensions Total deferred outflows of resources LIABILITIES Current Liabilities: Accounts payable Salaries payable Accrued interest payable Due to other funds Current portion: Compensated absences Capital lease obligation Claims and judgments Notes payable Revenue bonds payable Meter deposit liability Total current liabilities Non-current liabilities: Compensated absences Claims and judgments Capital lease obligation Net OPEB obligation Net pension liability Notes payable Revenue bonds payable, net Total non-current liabilities Total liabilities DEFERRED INFLOW OF RESOURCES Accumulated increase in fair value of hedging derivatives Deferred amounts related to pensions Total deferred inflow of resources NET POSITION Net investment in capital assets Restricted for debt service Restricted for scholarships Unrestricted Total net position

1,915,390 14,297,547

Wastewater Fund

Water Fund

4,325,301 37,878,846

Other Enterprise Funds

2,650,979 23,791,407

1,470,171 12,522,503

Total

10,361,841 88,490,303

Internal Service Funds

2,786,994 23,471,222

17,128 2,844,480

7,171,188 802,261

328,547

957,511 324,219

8,145,827 4,299,507

37,445 13,791,269 86,118 115,281 2,167,592 35,272,250

84,581 2,771,980 122 53,034,279

53,217 1,402,137 28,226,287

28,147 1,171,289 289,768 33,655 177,083 75,114 17,049,460

203,390 19,136,675 289,890 119,773 292,364 2,242,706 133,582,276

51,509 217,227 391,426 18,112 898,464 27,834,954

33,936 54,304 -

1,135,794 1,817,510 680,558

133,044 213,228 -

1,302,774 2,085,042 680,558

194,332 45,613,190 45,895,762 81,168,012

7,489,403 99,773,996 110,897,261 163,931,540

12,234,501 53,692,714 65,927,215 94,153,502

1,194,348 12,531,976 14,072,596 31,122,056

21,112,584 211,611,876 236,792,834 370,375,110

787,503 16,813,343 17,600,846 45,435,800

15,499 896,872 912,371

587,151 328,704 915,855

14,869 123,227 138,096

87,349 558,242 645,591

704,868 1,907,045 2,611,913

3,305,613 3,305,613

6,761,509 155,955 11,554 -

258,604 60,578 531,543 141,270

1,924,478 23,139 19,148 131,925

492,494 135,244 35,881 16,916

9,437,085 374,916 598,126 290,111

756,625 609,176 -

34,620 6,321 107,297 2,844,108 9,921,364

10,378 1,311,102 3,706,653 662,827 6,682,955

3,029 131,826 328,547 2,562,092

23,873 499,919 303,439 1,507,766

71,900 6,321 1,311,102 4,445,695 4,138,921 20,674,177

100,016 1,080,140 2,545,957

311,580 32,692 295,446 1,786,622 651,674 3,078,014 12,999,378

93,406 135,239 636,817 13,688,263 22,511,221 37,064,946 43,747,901

27,262 40,632 235,194 800,757 1,103,845 3,665,937

214,764 225,133 1,107,422 3,035,895 4,583,214 6,090,980

647,012 32,692 696,450 3,766,055 13,688,263 26,999,547 45,830,019 66,504,196

900,138 1,843,046 318,515 6,580,401 9,642,100 12,188,057

20,374 20,374

680,558 680,558

4,615 4,615

680,558 24,989 705,547

10,810 10,810

45,025,037 94,186 23,941,408 69,060,631

66,633,311 9,732,383 44,053,242 120,418,936

64,550,270 26,075,391 90,625,661

10,277,859 1,294,195 1,301 14,098,697 25,672,052

186,486,477 11,120,764 1,301 108,168,738 305,777,280

17,600,846 18,941,700 36,542,546

Some amounts reported for business-type activities in the Statement of Net Position are different because certain internal service fund balances are included with business-type activities and reported as interfund balances Total net position per Government-Wide financial statements

7,811,168 $

See accompanying notes to the basic financial statements.

313,588,448

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Statement of Revenues, Expenses and Changes in Fund Net Position Proprietary Funds For the Year Ended June 30, 2016 Edmond Public Works Authority (EPWA) Enterprise Funds

Electric Fund OPERATING REVENUES Charges for services Permits and other fees Operating grants and contributions Miscellaneous Total operating revenues

91,945,112 2,214 12,690 91,960,016

Wastewater Fund

Water Fund $

23,665,147 1,234,939 165,990 25,066,076

12,650,294 720,850 13,371,144

Other Enterprise Funds $

14,032,877 485,797 395,558 14,914,232

Total $

142,293,430 1,955,789 488,011 574,238 145,311,468

Internal Service Funds $

44,819,852 1,435,581 245,664 46,501,097

OPERATING EXPENSES Personal services Materials and supplies Wholesale electricity purchases Maintenance, operations and contractual services Insurance premium expense Claims expense Depreciation Total Operating Expenses Operating income (loss)

4,848,568 766,437 58,235,292 8,398,037 3,034,409 75,282,743 16,677,273

1,823,802 599,185 7,651,097 6,662,355 16,736,439 8,329,637

661,787 504,075 3,859,435 2,380,620 7,405,917 5,965,227

3,643,862 963,347 8,032,280 575,963 13,215,452 1,698,780

10,978,019 2,833,044 58,235,292 27,940,849 12,653,347 112,640,551 32,670,917

18,595,868 3,429,018 13,249,689 1,367,548 7,876,508 2,475,311 46,993,942 (492,845)

NON-OPERATING REVENUES (EXPENSES) Interest and investment revenue Miscellaneous revenue Gain (Loss) on capital asset disposal Interest expense Miscellaneous expenses Total non-operating revenue (expenses) Income (loss) before contributions and transfers Capital contributions Transfers in Transfers out Change in net position Total net position - beginning Total net position - ending

161,689 288,907 (20,826) 429,770 17,107,043 (8,365,297) 8,741,746 60,318,885 69,060,631

401,783 1,108 (1,030,197) (627,306) 7,702,331 3,165,827 20,386,315 (12,747,807) 18,506,666 101,912,270 120,418,936

231,061 6,440 (32,711) 204,790 6,170,017 2,857,339 9,027,356 81,598,305 90,625,661

123,173 (71,201) (79) 51,893 1,750,673 1,751,198 (354,737) 3,147,134 22,524,918 25,672,052

917,706 296,455 (1,154,935) (79) 59,147 32,730,064 6,023,166 22,137,513 (21,467,841) 39,422,902 266,354,378 305,777,280

220,665 187,655 (54,598) 353,722 (139,123) (139,123) 36,681,669 36,542,546

Change in net position, per above Some amounts reported for business-type activities in the Statement of Activities are different because the net revenue of certain internal service funds is reported with business-type activities Change in Business-Type Activities in Net Position per Government-Wide Financial Statements

39,422,902 777,421 $

40,200,323

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Statement of Cash Flows Proprietary Funds For the Year Ended June 30, 2016 Edmond Public Works Authority (EPWA) Enterprise Funds

Electric Fund CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers Payments to employees Receipts of customer meter deposits Payment of customer meter deposits Claims and judgments paid Interfund payments Interfund receipts Net cash provided by operating activities

91,707,820 (66,639,571) (4,679,233) 1,078,467 (607,548) (1,589,638) 19,270,297

24,838,569 (8,648,933) (1,734,008) 943,914 15,399,542

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers from other funds Transfer to other funds Net cash provided by (used in) noncapital financing activities

(8,365,297) (8,365,297)

7,702,500 (63,992) 7,638,508

CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Purchase of capital assets Proceeds from sale of capital assets Proceeds from issuance of capital lease Principal paid on capital debt Interest paid on capital debt Net cash provided by (used in) capital and related financing activities

(3,162,841) (53,115) (27,268) (3,243,224)

(2,074,957) (2,718,539) (1,274,707) (6,068,203)

CASH FLOWS FROM INVESTING ACTIVITIES Purchases of investments Sale of investments Interest and dividends Net cash provided by (used in) investing activities

(7,255,782) 124,242 (7,131,540)

(13,807,195) 314,426 (13,492,769)

Net Increase (decrease) in cash and cash equivalents Balances-beginning of year Balances-end of year

Reconciliation to Combining Statement of Net Position: Cash, including time deposits Restricted cash, including time deposits-current Restricted cash, including time deposits-noncurrent Total cash and cash equivalents, end of year

530,236

3,477,078

1,436,218

9,155,205

13,160,034 (2,865,711) (633,024) 555,120 10,216,419

Other Enterprise Funds

Total Enterprise Funds

Internal Service Funds

14,614,902 (9,732,546) (3,490,339) (222,073) 364,671 1,534,615

144,321,325 (87,886,761) (10,536,604) 1,078,467 (607,548) (1,811,711) 1,863,705 46,420,873

46,676,510 (16,936,712) (19,049,457) (8,056,853) (6,210) 2,627,278

1,751,198 (354,737) 1,396,461

9,453,698 (8,784,026) 669,672

(8,265,245) (82,021) (39,526) (8,386,792)

(944,667) (152,855) (103,838) (1,201,360)

(14,447,710) (3,006,530) (1,445,339) (18,899,579)

(2,198,229) 17,392 (2,180,837)

(2,289,505) 173,399 (2,116,106)

(1,912,127) 307,238 122,727 (1,482,162)

(25,264,609) 307,238 734,794 (24,222,577)

(2,567,052) 1,355,838 158,495 (1,052,719)

(286,479) 2,937,458

247,554

3,968,389

2,313,172

15,842,053

(606,278) 3,393,272

1,966,454

12,632,283

2,650,979

2,560,726

19,810,442

2,786,994

1,915,390 17,128 33,936 1,966,454

2,650,979 2,650,979

10,361,841 8,145,827 1,302,774 19,810,442

1,470,171 957,511 133,044 2,560,726

4,325,301 7,171,188 1,135,794 12,632,283

2,786,994 2,786,994

16,677,273

8,329,637

5,965,227

1,698,780

32,670,917

Reconciliation of Operating Income to Net Cash Provided by Operating Activities: Operating income (loss) $ Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation expense Miscellaneous non-operating revenue (expense) Change in assets and liabilities: Receivables, net Other receivable Inventories Due from other governments Due from other funds Accounts and other payables Due to other funds Customer meter deposits payable Unearned revenue Claims liability Net OPEB obligation Net Pension liability Accrued compensated absences $ Net cash provided by operating activities Non-cash Activities: Capital assets donated Capital assets from capital lease Total Non-cash Activities

Wastewater Fund

Water Fund

$ $

3,034,409 288,907

6,662,355 1,108

2,380,620 6,440

(504,266) (36,837) 441,871 (115,281) 419,528 (1,474,357) 470,919 26,940 29,156 12,035 19,270,297

(228,615) 802,644 (357,114) 141,270 13,860 13,195 21,202 15,399,542

(217,550) 423,195 1,514,150 131,925 4,445 5,189 2,778 10,216,419

3,165,827

2,857,339

3,165,827

2,857,339

42,875 42,875.00

575,963 (79) (9,483) (280) (117,538) 228,937 (650,957) (86,339) (172,230) 21,577 19,856 26,408 1,534,615

$ $

(492,845)

12,653,347 296,376

2,475,311 187,655

(959,914) (36,837) 441,591 (117,538) 1,339,495 925,607 (1,287,501) 470,919 (172,230) 66,822 67,396 62,423 46,420,873

(6,242) 55,881 (6,000) (6,210) 320,278 (180,345) 119,070 118,769 41,956 2,627,278

6,023,166 42,875 6,066,041

$ $

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Statement of Fiduciary Net Position Fiduciary Funds June 30, 2016

Pension Trust Fund ASSETS Cash and cash equivalents Accrued interest Total cash and cash equivalents Investments at fair value: Common stock Preferred stock Pooled equity funds Pooled fixed income funds Alternative-open end mutual funds Other assets Total investments Total assets

LIABILITIES Accounts payable Due to other governments Refunds payable and others Total liabilities NET POSITION Held in trust for benefits and other purposes

726,849 64,154 791,003

Agency Funds $

1,189,840 52,709 36,525,456 15,938,576 8,219,780 21,768 61,948,129 62,739,132

653,862

1,466 1,466

18,534 21,583 613,745 653,862

62,737,666

See accompanying notes to the basic financial statements.

653,862 653,862

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Statement of Changes in Fiduciary Net Position Fiduciary Funds For the Year Ended June 30, 2016

Pension Trust Fund ADDITIONS Contributions: Employer Plan Members Total contributions Investment earnings: Investment income (loss) Investment activity expense Total net investment earnings Total additions

2,292,339 1,400,380 3,692,719 (950,822) (111,096) (1,061,918) 2,630,801

DEDUCTIONS Benefits Refunds of contributions Administrative Miscellaneous expense Total deductions

2,289,885 1,319,648 20,928 6,283 3,636,744

Change in net position

(1,005,943)

Net position - beginning Net position - ending

63,743,609 62,737,666

See accompanying notes to the basic financial statements.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. FINANCIAL REPORTING ENTITY B. BASIS OF PRESENTATION C. MEASUREMENT FOCUS AND BASIS OF ACCOUNTING D. ASSETS, LIABILITIES, DEFERRED OUTFLOWS/INFLOWS OF RESOURCES AND NET POSITION/FUND BALANCE E. INTERNAL AND INTERFUND BALANCES AND ACTIVITIES F. REVENUES, EXPENDITURES AND EXPENSES G. USE OF ESTIMATES H. NEW ACCOUNTING PRONOUNCEMENT

NOTE 2. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY A. DEFICIT FUND BALANCES OR NET POSITION B. DEPOSITS AND INVESTMENTS REQUIREMENTS C. DEBT RESTRICTIONS AND COVENANTS

NOTE 3. DETAIL NOTES - TRANSACTION CLASSES/ACCOUNTS A. DEPOSIT AND INVESTMENT RISKS B. RECEIVABLES C. RESTRICTED ASSETS D. CAPITAL ASSETS E. LONG-TERM DEBT F. INTERFUND BALANCES AND ACTIVITIES G. FUND BALANCES AND NET POSITION

NOTE 4. OTHER NOTES A. EMPLOYEE PENSION AND OTHER BENEFIT PLANS B. RISK MANAGEMENT C. COMMITMENTS AND CONTINGENCIES D. RECENTLY ISSUED ACCOUNTING STANDARDS E. ECONOMIC DEVELOPMENT

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Edmond’s (the City) accounting and financial reporting policies conform to accounting principles generally accepted in the United States of America (GAAP). GAAP includes all relevant Governmental Accounting Standards Board (GASB) pronouncements. The accounting and reporting framework and the more significant accounting policies are discussed in subsequent subsections of this Note. 1.A. FINANCIAL REPORTING ENTITY The City’s financial reporting entity comprises the following: Primary Government:

City of Edmond

Blended Component Unit:

Edmond Public Works Authority

Discretely Presented Component Units: Edmond Economic Development Authority Edmond Historic Preservation Trust In determining the financial reporting entity, the City complies with the provisions of Governmental Accounting Standards Board Statement No. 14, 34, 39, and 61 and includes all component units of which the City is fiscally accountable. Each of these component units are Public Trusts established pursuant to Title 60 of Oklahoma State law. Public Trusts (Authorities) have no taxing power. The Authorities are generally created to finance City services through issuance of revenue bonds or other non-general obligation debt and to enable the City Council to delegate certain functions to the governing body (Trustees) of the Authority. The Authorities generally retain title to assets which are acquired or constructed with Authority debt or other Authority generated resources. In addition, the City has leased certain existing assets at the creation of the Authorities to the Trustees on a long-term basis. The City, as beneficiary of the Public Trusts, receives title to any residual assets when a Public Trust is dissolved. BLENDED COMPONENT UNITS Blended component units are separate legal entities that meet the GASB 14, 39 and 61 component unit criteria and whose governing body is the same or substantially the same as the City Council or the component unit provides services entirely to the City. These component units’ funds are blended into the City’s by appropriate fund type to comprise part of the primary government presentation. One component unit is blended into the primary government’s fund types as presented below: Brief Description/Inclusion Criteria

Component Unit Edmond Public Works Authority

(EPWA)

Created October 6, 1970, to finance, develop and operate the water, sewer, garbage, electric, lake and drainage facilities. Also, the Authority operates and maintains the City’s golf course facility. The current City Council serves as the governing body (Trustees) of the EPWA and the city is responsible for daily operations. The City is able to impose its will on the EPWA because, by state law, all EPWA issuances of debt require a two-thirds approval of the City Council. The EPWA funds are reported as enterprise funds within the primary government presentation.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

DISCRETELY PRESENTED COMPONENT UNITS Discretely presented component units are separate legal entities that meet the GASB 14 component unit criteria but do not meet the criteria for blending. The City has two component units that are discretely presented in the Cityâ&#x20AC;&#x2122;s report as presented below: Edmond Economic Development Authority Created June 17, 1969, to promote and encourage the general (EEDA) economic and social development within or near the City of Edmond, Oklahoma. The Authority provides financing to businesses for the purpose of acquiring facilities for industrial, manufacturing, and charitable enterprises in or near the City. The EEDA governing body is appointed by the full City Council. All issuances of debt require a two-thirds approval of the City Council and the EEDA Trustees. Complete financial statements of the Economic Development Authority component unit can be obtained from: Edmond Economic Development Authority 825 E. 2nd, Suite 200 Edmond, OK 73034 Edmond Historic Preservation Trust (EHPT)

Created November 15, 1982 to preserve the qualities relating to the history of the City in order to promote the economic and general welfare of the people of the City of Edmond and to ensure the harmonious, orderly and efficient growth and development of the municipality. The EHPT governing body is appointed by the current City Council. The City is able to impose its will on the EHPT because, pursuant to state law, all issuance of EHPT debt requires a two-thirds approval of the City Council. The EHPT component unit does not issue separate financial statements.

1.B. BASIS OF PRESENTATION Government-Wide Financial Statements: The statement of net position and statement of activities display information about the City as a whole including component units. They include all financial activities of the reporting entity except for fiduciary activities. Eliminations have been made to minimize the double reporting of transactions involving internal activities. Individual funds are not displayed in these statements. Instead, the statements distinguish between governmental and business-type activities. Governmental activities generally are financed through taxes, intergovernmental revenues, and other non-exchange revenues. Business-type activities are financed in whole or in part by fees charged to external parties for goods or services. The statement of activities presents a comparison between the expenses and program revenues directly associated with the different governmental functions and business-type activities to arrive at the net revenue or expense of the function or activity prior to the use of taxes and other general revenues. Program revenues include (1) fees, fines, and service charges generated by the program or activity, (2) operating grants and contributions that are restricted to meeting the operational requirements of the program or activity, and (3) capital grants and contributions that are restricted to meeting the capital requirements of the program or activity.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Fund Financial Statements: Fund financial statements of the reporting entity are organized into funds, each of which is considered to be separate accounting entities. Each fund is accounted for by providing a separate set of self-balancing accounts which constitute its assets, deferred outflows, liabilities, deferred inflows, fund equity, revenues, and expenditures/expenses. Separate financial statements are presented for the three major fund categories: governmental, proprietary and fiduciary. An emphasis of the fund financial statements is placed on major governmental and enterprise funds. A fund is considered major if it is the primary operating fund of the City or meets the following criteria: a.

Total assets and deferred outflows, liabilities, and deferred inflows, revenues or expenditures/expenses of that individual governmental or enterprise fund are at least 10 percent of the corresponding total for all funds of that category or type, and

Total assets and deferred outflows, liabilities and deferred inflows, revenues or expenditures/expenses of the individual governmental fund or enterprise fund are at least 5 percent of the corresponding total for all governmental and enterprise funds combined.

A fund not meeting the criteria of (a) and (b), however management has elected to report the fund as a major fund due to its significance to users of the financial statements.

All remaining governmental and enterprise funds not meeting the above criteria are aggregated and reported as nonmajor funds. The funds of the financial reporting entity are described below: Governmental Funds The City reports five major governmental funds: General Fund Fire Public Safety Limited Tax Fund Police Public Safety Limited Tax Fund 2000 Capital Improvement Tax Fund 2012 Public Safety Center Tax Fund General Fund The General Fund is the primary operating fund of the City. It is used to account for all activities except those legally or administratively required to be accounted for in other funds. The General Fund is reported as a major governmental fund. The General Fund main sources of revenue include sales tax, franchise and public services taxes, and charge for services related to governmental activities. Due to GASB 54 for financial reporting purposes, the General Fund also includes the activity of the Edmond Electric Economic Development Fund and the Park Special Events Fund. In fiscal year 2016, the Real Property Fund was moved to an account of the General Fund from a special revenue fund because it no longer has a dedicated income stream. Prior to 2014, Citylink (Edmondâ&#x20AC;&#x2122;s public transportation service) was included in the General Fund. Beginning in 2014, Citylink has been moved and is included as a Business Type Activity. Also in 2013â&#x20AC;&#x2122;s report, the Hotel/Motel tax was moved from the General Fund to Special Revenue Fund-CVB as a dedicated income revenue stream. We have continued to report this revenue there. Special Revenue Funds Special Revenue Funds are used to account for and report the proceeds of specific revenue sources that are legally or administratively restricted to expenditures for certain purposes. The reporting entity includes the following special revenue funds:

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Major Funds: Fire Public Safety Limited Tax Fund – used to account for restricted taxes and other dedicated revenues used to finance the operations of the City’s fire department Police Public Safety Limited Tax Fund – used to account for restricted taxes and other dedicated revenues used to finance the operations of the City’s police department and other capital projects Nonmajor Funds: CDBG Entitlement Fund Asset Forfeiture Fund Senior Center Fund Convention & Visitors Bureau Fund Hospital Sale Trust Fund Ambulatory Service Fund Capital Project Funds Capital Project Funds are used to account for resources restricted for the acquisition or construction of specific capital projects or items. The reporting entity includes the following capital project funds: Major Fund: 2000 Capital Improvement Tax Fund – used to account for the proceeds of a voter-restricted limited purpose sales tax to be used for capital improvements 2012 Public Safety Center Tax Fund – used to account for the proceeds of a five year half cent voterrestricted limited purpose sales tax to be used for the development of the City’s Public Safety Center and other capital projects as approved by the voters. Nonmajor Funds: Cemetery Care Fund Park Sales Tax Fund Art in Public Places Fund Capital Improvement Fund Roadway Improvement Fund 1996 Capital Improvement Tax Fund Proprietary Funds Proprietary funds include both enterprise funds and internal service funds. Enterprise funds are used to account for business-like activities provided to the general public. Internal service funds are used to account for business-like activities provided and charged to other funds or entities within the reporting entity. Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Nonoperating revenues of the proprietary funds include such items as investment earnings, interest expense and subsidies. The reporting entity includes the following enterprise funds and internal service funds: Enterprise Funds The City reports three major enterprise funds: Electric Fund – used to account for the operation and maintenance of the City electric utility services Water Fund – used to account for the operation and maintenance of the City water utility services Wastewater Fund - used to account for the operation and maintenance of the City wastewater utility services Nonmajor enterprise funds include: Sanitation Fund 44

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Arcadia Lake Fund Drainage Fund Kickingbird Golf Course Fund YourGovShop Fund Transportation Fund (CityLink) Internal Service Funds Internal service funds include: Employee Group Insurance Fund Vehicle Maintenance Fund Liability/Tort Claim Fund Fleet Management Fund Field Services Fund Administrative Support Services Fund Fiduciary Funds The City’s fiduciary funds are used to report net position and changes therein of assets held by the City in a trustee or fiduciary capacity. This net position is not available for operations of the City. The City reports two types of fiduciary funds: Pension Trust Fund and Agency Funds. Agency funds are custodial in nature (i.e., assets equal liabilities) and do not involve the measurement of changes in net position. Pension Trust Fund – used to account for the net position and changes therein of the Edmond Employee Retirement System Agency Funds – used to account for assets held on behalf of others including the Sidewalk and Driveway Escrow and the C.L.E.E.T. Penalty Assessment Fund 1.C. MEASUREMENT FOCUS AND BASIS OF ACCOUNTING Measurement focus is a term used to describe how transactions are recorded within the financial statements. Basis of accounting refers to when transactions are recorded regardless of the measurement focus applied. Measurement Focus On the government-wide Statement of Net Position and the Statement of Activities both governmental and businesslike activities are presented using the economic resources measurement focus as defined in item b. below. In the fund financial statements, the “current financial resources” measurement focus or the “economic resources” measurement focus is used as appropriate: a.

All governmental funds utilize a “current financial resources” measurement focus. Only current financial assets, liabilities, deferred outflows and inflows are generally included on their balance sheets. Their operating statements present sources and uses of available spendable financial resources during a given period. These funds use fund balance as their measure of available spendable financial resources at the end of the period.

The proprietary fund utilizes an “economic resources” measurement focus. The accounting objectives of this measurement focus are the determination of operating income, changes in net position (or cost recovery), financial position, and cash flows. All assets, liabilities (whether current or noncurrent), deferred outflows and inflows associated with their activities are reported. Proprietary fund equity is classified as net position. 45

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Basis of Accounting Government-wide, Proprietary and Fiduciary Fund Financial Statements In the government-wide Statement of Net Position and Statement of Activities, and the proprietary fund financial statements the accrual basis of accounting is applied. Under the accrual basis of accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred or economic asset used. Revenues, expenses, gains, losses, assets and liabilities resulting from exchange and exchange-like transactions are recognized when the exchange takes place. Governmental Fund Financial Statements In the governmental fund financial statements, the modified accrual basis of accounting is applied. Under this modified accrual basis of accounting, revenues are recognized when “measurable and available”. Measurable means knowing or being able to reasonably estimate the amount. Available means collectible within the current period or soon enough thereafter to pay current liabilities. The City has defined “available” as collected within 60 days after year end. Sales and use taxes, franchise taxes, hotel/motel taxes, court fines and interest are considered susceptible to accrual. Expenditures (including capital outlay) are recorded when the related fund liability is incurred, except for general long-term debt principal and interest, claims and judgments, and accrued compensated absences, which are recorded as expenditures to the extent they have matured. Proceeds of general long-term debt and capital leases are reported as other financial sources. 1.D. ASSETS, LIABILITIES, DEFERRED OUTFLOWS/INFLOWS OF RESOURCES, AND NET POSITION/FUND BALANCE. Cash and Cash Equivalents Cash and cash equivalents include all demand accounts, savings accounts, money market investment in trust accounts, certificates of deposit and short-term investments with an original maturity of three months or less. Investments in open-ended mutual fund shares are also considered cash equivalents and are reported at the funds’ current share prices. Investments Investments are reported at fair value using selected bases. Securities traded on a national or international exchange are valued at the last reported sales price at current exchange rates. Investments that do not have an established market are reported at estimated fair value as estimated by a broker/dealer. Investments of the pension trust fund are also carried at fair value. Securities of the pension trust fund traded on a national or international exchange are valued at the last reported sales price at current exchange rates. All non-negotiable long-term certificates of deposit are carried at cost. Additional cash and investment disclosures are presented in Note 2.B. and Note 3.A. Receivables In the government-wide statements, receivables consist of all revenues earned at period-end and not yet received. Allowances for uncollectible accounts receivable are based upon historical trends and the periodic aging of accounts receivable. Major receivable balances for the governmental activities include sales and use taxes, franchise taxes, grants, police fines, ambulance fees. Business-type activities report utilities as its major receivables. In the fund financial statements, material receivables in governmental funds include revenue accruals such as sales tax, franchise tax, tax increment revenue, and grants and other similar intergovernmental revenues since they are usually both measureable and available. Non-exchange transactions collectible but not available are deferred in the fund financial statements in accordance with modified accrual, but not deferred in the government-wide financial statements in accordance with the accrual basis. Interest and investment earnings are recorded when earned on if paid within 60 days since they would be considered both measurable and available. Proprietary fund material receivables consist of all revenues earned at period-end and not yet received. Utility accounts receivable (such as electric, water, wastewater, sanitation and drainage revenues) comprise the majority of proprietary fund receivables. Allowances for uncollectible accounts receivable are based upon historical trends and the periodic aging of accounts receivable. 46

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Inventories Inventories are valued at average cost. The cost of governmental funds inventories are recorded as expenditures when consumed rather than when purchased because they are immaterial. Restricted Assets Restricted assets include current assets of enterprise funds and business-type activities that are legally restricted as to their use. The primary restricted assets are related to revenue bond and promissory note trustee accounts restricted for debt service and deposits held for refund. Restricted assets of the component unit consist of program income from revolving grants restricted as to use. Capital Assets and Depreciation The accounting treatment of property, plant and equipment (capital assets) depends on whether the assets are used in governmental fund type or proprietary fund operations and whether they are reported in the government-wide or fund financial statements. Government-Wide Statements In the government-wide financial statements, property, plant and equipment are accounted for as capital assets. The Cityâ&#x20AC;&#x2122;s capitalization threshold is $5,000. All capital assets are valued at historical cost, or estimated historical cost if actual is unavailable, except for donated capital assets which are recorded at their estimated fair value at the date of donation. General infrastructure assets (such as roads, bridges, and traffic systems) acquired prior to July 1, 2002, are reported at estimated historical cost using deflated replacement costs. The cost of normal maintenance and repairs to these assets that do not add materially to the value of the asset or materially extend the assetsâ&#x20AC;&#x2122; useful lives are not capitalized. Interest costs, net of interest earned on any invested capital debt proceeds, are capitalized when incurred by proprietary funds. Depreciation of all exhaustible capital assets is recorded as an operating expense in proprietary fund financial statements and an allocated expense in the Statement of Activities, with accumulated depreciation reflected in the Statement of Net Position. Depreciation is provided over the assetsâ&#x20AC;&#x2122; estimated useful lives using the straight-line method of depreciation. The range of estimated useful lives by type of asset is as follows: Buildings Other Improvements Infrastructure Equipment and vehicles Water rights

15 - 50 years 5 - 50 years 50-100 years 2 - 40 years 25-50 years

In the governmental fund financial statements, capital assets acquired are accounted for as capital outlay expenditures. Long-Term Debt Accounting treatment of long-term debt varies depending upon the source of repayment and the measurement focus applied and whether the debt is reported in the government-wide or fund financial statements. All long-term debt to be repaid from governmental activities, business-type activities, proprietary fund and component unit resources are reported as liabilities as incurred. The long-term debt consists primarily of accrued compensated absences, general obligation bonds payable, and revenue bonds payable. This long-term debt is reported net of unamortized premiums and discounts. Amounts deferred from refundings and shown as deferred inflows or outflows. Long-term debt of governmental funds is not reported as liabilities in the fund financial statements. The debt proceeds are reported as other financing sources and payment of principal and interest reported as expenditures. 47

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Compensated Absences Under terms of union contracts and City personnel policies, City employees are granted vacation and sick leave in varying amounts. In the event of termination, a civilian employee is paid for accumulated vacation up to 300 hours earned. Upon retirement, 33-1/3% of accumulated sick leave up to a maximum of 300 hours is converted to vacation time for non-union employees, subject to certain limitations. For firemen, sick leave hours are converted three to one to vacation hours not to exceed 400 hours at retirement plus 480 maximum vacation (suppression) and 288 maximum vacation (non-suppression). For police officers, sick leave hours are converted two to one with a maximum of 400 hours plus maximum of 320 vacation hours at retirement. The estimated liabilities for vested benefits also include salary-related payments such as employment taxes. Compensated absences are reported as accrued in the government-wide, proprietary, fiduciary and component unit financial statements. Governmental funds report only the matured compensated absences payable to currently terminating employees; however, the compensated absences obligation is reported as a fund balance reserve in compliance with the State Constitution. Deferred Outflow/Inflows of Resources In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. At the government fund level, the City does not recognizes any deferred outflows. At the enterprise fund level and government-wide level, the City recognizes deferred outflows related a refunding to and deferred amounts related to pensions. In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period (s) and so will not be recognized as an inflow of resources (revenue) until that time. The government has at the fund level only one type of item, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from two sources: property taxes and special assessments. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available. At the government wide level, deferred inflows are reporting the fair value of hedging a derivative and the amounts related to pensions. Equity Classifications Government-Wide and Proprietary Fund Financial Statements: Equity is classified as net position and displayed in three components: a. b. c.

Net investment in capital assets - Consists of capital assets including restricted capital assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds, mortgages, notes or other borrowings that are attributable to the acquisition, construction, or improvement of those assets. Restricted net position - Consists of net position with constraints placed on the use either by 1) external groups such as creditors, grantors, contributors, or laws or regulations of other governments, or 2) law through constitutional provisions or enabling legislation. Unrestricted net position - All other net position that do not meet the definition of “restricted” or “net investment in capital assets”.

It is the City’s policy to first use restricted net position prior to the use of unrestricted net position when an expense is incurred for purposes for which both restricted and unrestricted net position are available.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Governmental Fund Financial Statements: Governmental fund equity is classified as fund balance. Fund balance is further classified as nonspendable, restricted, committed, assigned and unassigned. These classifications are defined as: a)

Nonspendable-includes amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact. b) Restricted-consists of fund balance with constraints placed on the use of resources either by (1) external groups such as creditors, grantors, contributors, or laws or regulations of other governments, or (2) laws through constitutional provisions or enabling legislation. c) Committed-included amounts that can only be used for specific purposed pursuant to constraints imposed by formal action of the city’s highest level of decision-making authority. The City’s highest level of decision-making authority is made by ordinance. City Council adopts an ordinance that establishes this constraint. d) Assigned-includes amounts that are constrained by the City’s intent to be used for specific purposed but are neither restricted nor committed. Assignments of fund balance may be made by city council action or management decision when the city council has delegated that authority. Assignments for transfers and interest income for governmental funds are made through budgetary process. e) Unassigned-represents fund balance that not been assigned to other funds and has not been restricted, committed, or assigned to specific purposes within the general fund. The general fund is the only fund that reports a positive unassigned fund balance.

It is the City’s policy that expenditures for which more than one category of fund balance could be used, that the order of use is: restricted, committed, assigned and unassigned. The City Council adopted the budget which designates the amount to the specific categories. In an effort to ensure the continuance of sound financial management of public resources, the City of Edmond’s Unassigned Fund Balance within the General Fund will be maintained to provide the City with sufficient working capital and a comfortable margin of safety to address emergencies, sudden loss of revenue or operating needs, and unexpected downturns. This policy established the amounts the City will strive to maintain in its General Fund unassigned balance, the conditions under which fund balance may be spent, and the method by which fund balance will be restored. These amounts are expressed as goals, recognizing that fund balance levels can fluctuate from year to year in the normal course of operations for any local government. The City will strive to maintain an Unassigned Fund Balance in the General Fund of (10%). This is determined by adding all new budgeted revenues, plus the Edmond Public Works Authority’s transfers-in, divided by the Unassigned Fund Balance. It is management’s express intent to identify a “not-to-exceed” amount of $1,000,000 as part of the 10% minimum fund balance for unexpected, large-scale events where damage in excess of $250,000 is incurred and immediate, remedial action must be taken to protect the health and safety of residents (e.g. floods, fires, storm damage). Of the $1,000,000 part of the General Fund’s Unassigned Fund Balance, it is management’s intent to not use any portion of this balance unless such emergencies occur. It is the goal of the City to limit use of any Unassigned Fund balances less than 10% to address non-recurring needs, otherwise approved by the City Council. Unassigned Fund balances of less than the 10% minimum as described above shall not normally be applied to recurring annual operating expenditures. Unassigned balances within the General Fund may, however, be used to allow time for the city to restructure its operations in a deliberate manner, but such use will only take place in the context of long-term financial planning. 1.E. INTERNAL AND INTERFUND BALANCES AND ACTIVITIES In the process of aggregating the financial information for the government-wide financial, some amounts reported as interfund activity and balances in the fund financial statements have been eliminated or reclassified. 49

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Government-Wide Financial Statements: Interfund activity and balances, if any, are eliminated or reclassified in the government-wide financial statement as follows: a. Internal balances - amounts reported in the fund financial statements as interfund receivables and payables are eliminated in the governmental and business-type activities columns of the statement of net position, except for the net residual amounts due between governmental and business-type activities, which are reported as Internal Balances. b.

Internal activities - amounts reported as interfund transfers in the fund financial statements are eliminated in the government-wide statement of activities except for the net amount of transfers between governmental and business-type activities, which are reported as Transfers - Internal Activities. The effects of interfund services between funds are not eliminated in the statement of activities.

Primary government and component unit activity and balances - resource flows between the primary government (the City and EPWA) and the discretely-presented component units (the Historical Preservation Trust and EEDA) are reported as if they were external transactions.

Fund Financial Statements: Interfund activity, if any, within and among the governmental, proprietary fund and fiduciary categories is reported as follows in the fund financial statements: 1.

Interfund loans - amounts provided with a requirement for repayment are reported as interfund receivables and payables.

Interfund services - sales or purchases of goods and services between funds are reported as revenues and expenditures/expenses.

Interfund reimbursements - repayments from funds responsible for certain expenditures/expenses to the funds that initially paid for them are not reported as reimbursements but as adjustments to expenditures/expenses in the respective funds.

Interfund transfers - flow of assets from one fund to another where repayment is not expected are reported as transfers in and out.

1.F. REVENUES, EXPENDITURES AND EXPENSES Sales Tax The City levies a three and three-fourth cent sales tax on taxable sales within the City. The sales tax is collected by the Oklahoma Tax Commission and remitted to the City in the month following receipt by the Tax Commission. The sales tax is recorded as follows: 2 cents recorded as revenue within the General Fund then transfers .75 of one cent to the Water Enterprise Fund as required by the bond indenture for debt service. Any unused portion is transferred back to the General Fund. 1/8 cent recorded as revenue within the Park Sales Tax Fund to account for operations and facility improvement costs of the Cityâ&#x20AC;&#x2122;s park and recreation system. 3/4 cent recorded as revenue within the 2000 Capital Improvement Tax Fund to account for capital improvements as recommended to the City Council by the Capital Financing Task Force. 1/4 cent recorded as revenue within the Fire Public Safety Limited Tax Fund to account for improvements to the fire department per voter approval.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

1/8 cent recorded as revenue within the Police Public Safety Limited Tax Fund to account for improvements to the police department per voter approval. 1/2 cent recorded as revenue within the 2012 Capital Improvement Tax Fund-PSC to account for building the new Public Safety Center and other capital projects per voter approval.

Sales tax resulting from sales occurring prior to year-end and received by the City after year end have been accrued and is included under the caption Due from Other Governments because they represent taxes on sales occurring during the reporting period. Police and Fire Public Safety Funds Revenue An ordinance passed and approved by the citizens of Edmond requires that 30% of General Fund revenues (defined as taxes, licenses and permits, fines and forfeitures, charges for services, interest and miscellaneous revenues) be used for funding fire department operations and that 36.8% of these same General Fund revenues be used for funding police department operations. Effective July 1, 2001 all fire and police expenditures were accounted for in the limited purpose sales tax special revenue funds. The special revenue funds also receive sales tax (approved in the same ordinance referenced above) of one-fourth percent for the fire department and one-eighth percent for the police department. Those sales taxes can only be expended for additional personnel and equipment for additional personnel, additional equipment for firefighting and law enforcement purposes, and also for competitive compensation and benefits for existing and retired firefighters and officers. The ordinance further states that expenditures will not be charged against the sales tax revenues until the General Fund revenues have first been used or encumbered. Hospital Sales Trust Fund Principal and Income In 1981, the City sold the Edmond Memorial Hospital for approximately $7,200,000. The majority of the proceeds are invested in a trust account. According to trust agreement terms, the earnings and interest of the trust funds can be used by the City for capital improvements. The principal of the trust must also be used for capital improvements, but its use must first be approved by a vote of the citizens of the City. Edmond voters approved a half-cent sales tax on October 11, 2011 and allowed the City to loan itself money out of the $7.2 million Hospital Trust Fund, but is contingent upon paying the borrowed funds back with interest. Pension Contributions For purposes of measuring the net pension liability, deferred outflows or resources and deferred inflows of resources related to pensions, and pension expense, amounts and disclosures have been prepared using the accrual basis of accounting. Employee and employer contributions are recognized as System revenues in the period in which they are due to the plan. Benefits and refunds are recognized when due and payable pursuant to plan provisions. Investments are reported at fair value. Property Tax Under State law municipalities are limited in their ability to levy a property tax. Such tax may only be levied to repay principal and interest on general obligation bonded debt approved by voters and any court-assessed judgments. At the present time the City levies a property tax for court-assessed judgments only. Pledge of Future Revenues Sales Tax Pledge - The City has pledged three-fourth cents (or 20%) of future sales tax revenues to repay $84,350,000 of Series 2010, 2012, 2013, 2014, 2014B, and 2015 Sales Tax and Utility System Bonds. Proceeds from the bonds provided financing for capital assets. The bonds are payable from pledged sales tax revenues and further secured by net electric, water, wastewater, and sanitation revenues. The bonds are payable through 2021, 2023, 2023, 2024, 2026, and 2024 respectively. The total principal and interest payable for the remainder of the life of these bonds is $98,689,367. Pledged sales taxes received in the current year were $12,683,814 for the bonds and the net utility revenues were $47,872,340. Debt service payments for the bonds of $11,308,595 for the current fiscal year were 89% of the pledged sales taxes and 24% of both pledged sales taxes and utility revenues. 51

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Utility Net Revenues Pledge – The City has also pledged future net electric, water, wastewater, and sanitation revenues to repay $43,195,000 of 2014 and 2015 Series Utility System Revenue Bonds and $3,726,484 of 2005 OWRB Notes Payable and $16,085,000 on the General Sales Revenue Note with Bank of America . Proceeds from the bonds and notes provided financing for utility system capital assets. The bonds are payable through 2024 while the notes are payable through 2024 and 2026. The total principal and interest payable for the remainder of the life of these bonds and notes is $63,106,446. The bonds are payable from the above-mentioned utility net revenues and are additionally secured with .75 of one cent (or 20%) of future sales tax revenues. If the net utility revenues are sufficient to service the debt, the pledged sales taxes are transferred back to the General Fund. The total pledged sales taxes for the current fiscal year of $12,683,815 were returned to the General Fund. The debt service payments on the bonds and notes this year were $5,313,989 which was 42% of pledged net utility revenues of $56,423,895 and 9% of both pledged utility revenues and pledged sales taxes. Expenditures and Expenses In the government-wide statement of activities, expenses, including depreciation of capital assets, are reported by function or activity. In the governmental fund financial statements, expenditures are reported by class as current (further reported by function), capital outlay and debt service. In proprietary fund financial statements, expenses are reported by object or activity. Fiduciary funds report additions and deductions to net position. 1.G. USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures; accordingly, actual results could differ from those estimates. 1.H. NEW ACCOUNTING PRONOUNCEMENTS Effective July 1, 2015, the City implemented GASB 72, Fair Value Measurement and Application. The statement required the City to use the following techniques that are appropriate to measure fair value: market approach, cost approach, or the income approach. This statement establishes three hierarchy levels of inputs as to the valuation techniques used to measure fair value. These additional disclosures can be found in Note 3.A. NOTE 2. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY By its nature as a local government unit, the City and its component units are subject to various federal, state and local laws and contractual regulations. An analysis of the City’s compliance with significant laws and regulations and demonstrations of its stewardship over City resources follows. 2.A. DEFICIT FUND BALANCES OR NET POSITION Title 11, Section 17-211 of the Oklahoma Statutes prohibits the creation of a deficit fund balance in any individual fund of the City (excluding public trusts). At June 30, 2016, the City reported a deficit in the 2012 Public Safety Center Tax Fund. 2.B. DEPOSITS AND INVESTMENTS REQUIREMENTS The Treasurer is authorized to invest funds in such securities as provided by Oklahoma State Statutes. The City’s General/Operating and Public Works Authority Funds Investment Policy may be more restrictive than that allowed by state statute. The securities authorized by the approval of this policy shall be: a.

Direct obligations of the United States Government, its agencies or instrumentalities to the payment of which the full faith and credit of the Government of the United States is pledged or obligations to the payment of which the full faith and credit of the State of Oklahoma is pledged; or

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Collateralized or insured certificates of deposits of savings and loan associations, banks, savings banks and credit unions located in this state, when the certificates of deposit are secured by acceptable collateral as provided in Oklahoma State Title 62, Section 517.5 or fully insured certificates of deposit at banks, savings banks, savings and loan associations and credit unions located out of state; or

Savings accounts or saving certificates of savings and loan associations, banks, and credit unions, to the extent that the accounts or certificates are fully insured by the Federal Deposit Insurance Corporation; or

Investments as authorized by Oklahoma State Title 62, Section 348.3 which are fully collateralized in investments specified in paragraphs 1 through 3 of this section, and where the collateral has been deposited with a trustee or custodian bank in an irrevocable trust or escrow account established of such purposes; or

County, municipal or school district direct debt obligations for which an ad valorem tax may be levied or bond and revenue anticipation notes, money judgments against such county, municipality or school district ordered by a court of record or bonds or bond and revenue anticipations notes issued by a public trust for which such county, municipality or school district is a beneficiary thereof. All collateral pledged to secure public funds shall be valued at no more than market value. The income received from the investment may be place in the general fund of the governmental subdivision to be used for general governmental operations, the sinking fund, the building fund, or the fund from which the investment was made.

Obligations of the United States government, its agencies and instrumentalities;

Collateralized or insured certificates of deposits and other evidences of deposit at banks, saving banks, savings and loan associations and credit unions located within the state; or full insured certificates of deposit and banks, savings banks, savings and loan associations and credit unions located out of state;

Negotiable certificates of deposit issued by a nationally or state-charted bank, savings bank, a savings and loan association or a state-licensed branch of a foreign bank. Purchases of negotiable certificates of deposits shall not exceed ten percent (10%) of the surplus funds of the city or county which may be invested pursuant to this section. Not more than one-half (1/2) of the ten percent (10%) limit shall be invested in any one financial institution specified in this paragraph;

Prime banker’s acceptances which are eligible for purchase by the Federal Reserve System and which do not exceed two hundred seventy (270) days’ maturity. Purchases of prime banker’s acceptances shall not exceed ten percent (10%) of the surplus funds of the city or county which may be invested pursuant to this section. Not more than one-half (1/2) of the ten percent (10%) limit shall be invested in any one commercial bank pursuant to this paragraph;

Prime commercial paper which shall not have a maturity that exceeds one hundred eighty (180) days nor represent more than ten percent (10%) of the outstanding paper of an issuing corporation. Purchases of prime commercial paper shall not exceed seven and one-half percent (7 ½ %) of the surplus funds of the city or county which many be invested pursuant to this section; and

Repurchase agreements that have underlying collateral consisting of those items specified in paragraphs 1 through 5 of this subsection.

Money market funds regulated by the Securities and Exchange Commission and which investments consist of those items and those restrictions in paragraphs 1 through 6 of this subsection.

Public trusts created under O.S. Title 60 and pension trust funds are not subject to the above noted investment limitations and are primarily governed by any restrictions in their trust or bond indentures.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

2.C. DEBT RESTRICTIONS AND COVENANTS Notes Payable The loan agreement with the Oklahoma Water Resources Board relating to the interim construction note payable of the Edmond Public Works Authority contains a number of financial restrictions or covenants. These include covenants requiring a flow of funds through special accounts and a note payable debt service coverage requirement. The note agreement requires net revenues of the system plus pledged and transferred sales tax to be at least 125% of maximum annual debt service. The Note indenture relating to the 2013 General Sales Tax Revenue note payable of the Edmond Public Works contains a number financial restrictions or covenants. Revenue Bond Debt The bond indentures relating to the revenue and sales tax bond issues of the Edmond Public Works Authority and the City contain a number of financial restrictions or covenants. These include covenants requiring a flow of funds through special accounts, required reserve account balances and revenue bond debt service coverage requirement. The 2010, 2012, 2013, 2014, 2014B, and 2015 series sales tax and utility revenue bond indentures require (1) a reserve account balance $8,335,000 and (2) net revenues plus pledged and transferred sales tax to be at least 100% of the maximum annual debt service requirements. The City complied with these covenants for the fiscal year ended June 30, 2016. NOTE 3. DETAIL NOTES - TRANSACTION CLASSES/ACCOUNTS The following notes present detail information to support the amounts reported in the basic financial statements for its various assets, liabilities, equity, revenues and expenditures/expenses. 3.A. DEPOSIT AND INVESTMENT RISKS Primary Government: The City of Edmond, including its blended component unit held the following deposits and investments at June 30, 2016.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

F a ir Va lue F a ir Va lue

Type De m a nd a c c o unts

R a ting

M a turitie s in Ye a rs

C a te go ry (3)

De m a nd

n/a

60,960,413

n/a

32,510,413

M o ne y m a rke t a c c o unts

31,400,175

n/a

31,400,175

U.S . Tre a s ury Obliga tio ns

12,055,382

(1)

Le ve l I

7,465,862

4,589,520

45,430,380

55,392,158

U.S . Go ve rnm e nt s po ns o re d e nte rpris e s S ub-to ta l

100,822,538

(2)

Le ve l II

15,938,576

Le ve l I

230,151,701

8,974,617

$ 116,806,830

6 - 10

n/a

M utua l F unds -fixe d inc o m e

8,974,617

1- 5

8,974,617

Tim e de po s its

Le s s Tha n One

28,450,000

$ 88,431,678

15,938,576 $ 15,938,576

M utua l F unds : Alte rna tive Equity F unds S ub-to ta l M utua l F unds

n/a

Le ve l I

n/a

Le ve l I

1,242,549

n/a

Le ve l I

21,768

n/a

44,745,236

C o m m o n a nd pre fe rre d s to c k Othe r To ta l Inve s tm e nts

8,219,780 36,525,456

276,161,254

R e c o nc ilia tio n to S ta te m e nt o f Ne t P o s itio n: C a s h a nd c a s h e quiva le nts

Inve s tm e nts

19,564,252 157,592,792

C urre nt re s tric te d c a s h a nd c a s h e quiva le nts

16,689,639

C urre nt re s tric te d inve s tm e nts

7,542,024

No nc urre nt re s tric te d c a s h a nd c a s h e quiva le nts

2,878,015

No nc urre nt re s tric te d inve s tm e nts

8,565,692

P e ns io n re tire m e nt fund a s s e ts

62,674,978

Age nc y fund c a s h a nd inve s tm e nts

653,862 $

276,161,254

** Unra te d

(1) U.S. obligations include Treasury bills, Treasury notes, and Treasury bonds. U.S. obligations are backed by the full power of the United States government and are guaranteed by the full faith and credit of the United States government. (2) U.S. government sponsored enterprise (GSE ) securities are debt issued by a financial intermediary established by the federal government to fund loans for a public purpose. GSE’s lack the explicit backing of the U.S. government, but are federally chartered entities. GSE securities are listed below with the corresponding credit ratings: GSE Name  Federal National Mortgage Association (FNMA or “Fannie Mae”)  Federal Home Loan Mortgage Corporation (FHLMC or “Freddie Mac”)  Federal Home Loan Bank (FHLB)  Federal Farm Credit Banks (FFCB)  Federal Agricultural Mortgage Corporation (FAMC or “Farmer Mac”)

S & P Rating AA+

Moody Rating Aaa

AA+

Aaa

AA+ AA+ not rated

Aaa Aaa Aa1

(3) The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Custodial Credit Risk – Exposure to custodial credit risk related to deposits exists when the City holds deposits that are uninsured and uncollateralized; collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the City’s name; or collateralized without a written or approved collateral agreement. Exposure to custodial credit risk related to investments exists when the City holds investments that are uninsured and unregistered, with securities held by the counterparty or by its trust department or agent but not in the City’s name. The City’s policy as it relates to custodial credit risk is to secure its uninsured deposits with collateral, valued at no more than market value, at least at a level of 102% of the uninsured deposits and accrued interest thereon. The investment policy also limits acceptable collateral to U.S. Treasury securities and direct debt obligations of municipalities, counties, and school districts in the state of Oklahoma. As required by Federal 12 U.S.C. Section 1823(e), all financial institutions pledging collateral to the City must have a written collateral agreement approved by the board of directors or loan committee. At June 30, 2016, the City was not exposed to custodial credit risk as defined above. Investment Credit Risk – The City’s investment policy limits investments to those with a maturity no more than five years from the date of purchase. These investment limitations are described in Note 2B. Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. The City has no formal policy limiting investments based on credit rating, but discloses any such credit risk associated with their investments by reporting the credit quality ratings of investments in debt securities as determined by nationally recognized statistical rating organizations—rating agencies—as of the year end. Unless there is information to the contrary, obligations of the U.S. government or obligations explicitly guaranteed by the U.S. government are not considered to have credit risk and do not require disclosure of credit quality. The credit ratings of other City investments are listed in the schedule above. The fair value of the City’s forward sales agreements are fully exposed to credit risk. The forward sales agreements require the counterparty to notify the trustee, EPWA, and the bond insurer if any of the long-term unsecured outstanding debt of the guarantor falls below A- by S&P and below A3 by Moody’s or is unrated by either rating agency. Upon such notice, the trustee or EPWA may (1) direct the counterparty to either assign the agreements to an acceptable transferee, (2) provide a guaranty issued by an acceptable guarantor, or (3) terminate the agreements without penalty. Investment Interest Rate Risk – Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The City’s investment policy limits investments to those with a maturity no more than five years from the date of purchase, except for reserve funds, as a means of managing exposure to fair value losses arising from increasing interest rates. The City discloses its exposure to interest rate risk by disclosing the maturity dates of its various investments. The derivative instruments mature between 5 and 8 years. Concentration of Investment Credit Risk - Exposure to concentration of credit risk is considered to exist when investments in any one issuer represent a significant percent of total investments of the City (any over 5% are disclosed). Investments issued or explicitly guaranteed by the U.S. government and investments in mutual funds, external investment pools, and other pooled investments are excluded from this consideration. At June 30, 2016, the City had a total portfolio concentration of credit risk in the following investments: FAMC 2.3%, FFCB 8.8%, FHLB 17.8%, FHLMC 10.8%, FNMA 7.2%. Pension Plan Investments: The Plan policy provides that assets be invested to provide for total return. The plan shall be invested in a diversified portfolio, consisting primarily of common stocks, bonds, cash equivalents, and other investments, which may reflect varying rates of return. The overall rate of return objective of the portfolio is a reasonable “real” rate, consistent with the risk levels established by the Pension Board. The minimum acceptable long-term rate of return over a full market cycle (3 to 5 years) is that which equals or exceeds the actuarial assumptions. The Pension Board has also established a annual target return objective, which may be changed from time to time, but is currently 7.25 percent, net of fees. This return objective currently meets the actuarial assumption of 7.25%. 56

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Asset allocation guidelines for the Plan are as follows: Class Fixed Income Large Cap Equities Small Cap Equities International Equities Emerging Market Equities Real Estate Commodities Master Limited Partnerships

Targe t Pe rcent 29% 15% 5% 14% 9% 9% 11%

June 2016 Pre se nt 28% 19% 6% 13% 12% 7% 5%

10%

Rate of return. For the year ended June 30, 2016, the annual money-weighted rate of return on pension plan investments, net of pension plan investment expense, was -1.66 percent. The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested. Component Units: Total bank deposits of the EEDA component unit were $288,734 at June 30, 2016 and were properly collateralized. In addition, deposits of the Historical Preservation Trust of $92,010 were fully collateralized. Derivatives - Investment Securities Forward Sale Contract: The City has entered into multiple forward contracts for the continuous investment of various debt service and reserve funds in “eligible securities”. “Eligible securities” are defined in the various forward contracts as those securities generally allowable as investments by municipalities under Oklahoma law. By entering into these agreements, the City seeks to ensure fixed rates of return while providing cash flow streams to match related principal and interest payments. No cash was paid or received when the contracts were initiated. The notional (or contract) amounts vary over the life of the contracts along with the balances in the funds. With regards to debt service funds, the notional amount at each delivery date is the amount the City is required to maintain on deposit in the Debt Service Fund pursuant to the bond indenture of the associated debt. The notional amount for forward contracts related to reserve funds is the reserve fund balance available for investment; not to exceed the reserve requirement of the associated debt. The change in fair value is reported as deferred inflow of resources.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Effective Date

Associated Debt

T ermination Contract Change in Fair Date Interest Rate Value

Fair Value at June 30, 2016

Credit Rating

Counterparty

Governmental activities: 2010 Sales T ax & Utility Revenue Bonds: Reserve Fund

5/13/2003

7/1/2021

4.570%

(85,651)

558,233 JPMorgan

A+

7/1/2023

4.650%

(30,580)

431,089 JPMorgan

A+

2012 Sales T ax & Utility Revenue Bonds: Reserve Fund

5/13/2003

2014 Sales T ax & Utility Revenue Bonds: Debt Service

8/24/2004

7/1/2024

4.500%

(4,935)

209,441 JPMorgan

A+

Reserve Fund

8/24/2004

7/1/2024

4.876%

(16,317)

546,080 JPMorgan

A+

Total governmental activities:

(137,483) $

1,744,843

Business-type Activities:

2014 Sales T ax & Utility Revenue Bonds: Debt Service

8/24/2004

7/1/2024

4.500%

(4,446)

188,660 JPMorgan

A+

Reserve Fund

8/24/2004

7/1/2024

4.876%

(14,698)

491,898 JPMorgan

A+

(19,144) $

680,558

(156,627) $

2,425,401

Total business-type activitie s:

Total

Fair value was determined using expected cash flows discounted to the treasury curve at June 30, 2016. Credit risk – The counterparty to the forward sale contract derivative agreements is JPMorgan serving as guarantor. At June 30, 2016, the counterparty’s credit ratings were A+. Termination risk – The City or its counterparties are subject to termination risk if the bonds for which the debt service and reserve funds relate are redeemed, refunded, or defeased. If the bonds are redeemed, refunded or defeased in whole, then immediately upon payment of the termination value then the agreement shall terminate. If the bonds are redeemed or defeased in part, then the Termination Value shall be determined based on the portion of the agreement which will terminate and immediately upon payment of the termination value, this agreement shall terminate in part and the balance of this agreement shall remain in effect, the Reserve Requirement shall be amended to reflect that portion of the agreement that has been terminated. 3.B. RECEIVABLES Accounts Receivable Accounts receivable of the business-type activities consist of customers utilities services provided, both billed and unbilled, due at year end, reported net of allowance for uncollectible amounts. The governmental activities receivables include fines, other taxes, and miscellaneous receivables as follows:

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Business-T ype Activities:

Electric Fund Utilities Receivable

Water Fund

$ 14,733,183

Less:allowance for uncollectible accounts

$ 2,921,803

(941,914)

Utilities receivable, net of allowance

Wastewater Fund

Sanitation Fund

$ 1,553,998

$ 1,030,855

(149,823)

$ 13,791,269

(151,861)

$ 2,771,980

$ 1,402,137

Drainage Fund $

250,659

221,892

(81,458) $

949,397

T otal $ 20,490,498

(28,767)

(1,353,823) $ 19,136,675

Other Receivables-Business-T ype Activities

119,773

T otal Accounts Receivable-Business-T ype Activities

$ 19,256,448

Governmental Activities:

Fines Receivable Other receivables

Less: allowance for uncollectible accounts

1,895,093

Other T axes Receivable

Park & Recreation Receivable

Miscellaneous Receivables

610,878

(1,390,516)

Other receivables, net of allowance

504,577

124,500

523,837

610,878

124,500

$ 3,154,308

T otal

(1,390,516)

523,837

$ 1,763,792

3.C. RESTRICTED ASSETS The amounts reported as restricted assets of the business-type activities are comprised of assets held by the trustee bank on behalf of the EPWA related to their required revenue note and bond accounts, deposits held for refund and EEDA restricted accounts related to revolving loan program income. Governmental activity restricted assets are comprised of assets held by a trustee bank on behalf of the City related to required revenue bond accounts. Current Cash and cash equivalents Investments

Noncurrent Cash and cash equivalents Investments

T otal

Primary Government Governmental Activities: Revenue bond trustee accounts

8,543,812

3,242,517

$ 1,575,241

$ 6,480,650

19,842,220

T otal Governmental Activities $

8,543,812

3,242,517

$ 1,575,241

$ 6,480,650

19,842,220

6,121,903

9,509,719

Business-type Activities: Revenue bond trustee accounts

Deposits held for refund Deposits held for construction T otal Business-type Activities $

$ 1,302,774

2,085,042

4,016,642

2,023,924

282,865

2,306,789

4,299,507

$ 1,302,774

$ 2,085,042

8,145,827

15,833,150

Component Unit: The Edmond Economic Development Authority (EEDA) restricted assets at year end included the following: Current Cash and cash equivalents, program income Total

41,250

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

3.D. CAPITAL ASSETS Capital asset activity for the fiscal year ended June 30, 2016 was as follows: B a la nc e a t J uly 1, 2015

Additio ns

De duc tio ns

B a la nc e a t J une 30, 2016

G o v e rn m e n t a l a c t iv it ie s : No n-de pre c ia ble : La nd

C o ns truc tio n-in-pro gre s s

15,207,778

51,778,171

25,782,294

(52,705,382)

24,855,083

66,985,949

25,782,294

(52,705,382)

40,062,861

B uildings

75,515,802

34,350,394

109,866,196

Im pro ve m e nts

32,142,898

2,179,997

34,322,895

M a c hine ry a nd e quipm e nt

47,399,837

6,602,009

292,949,819

15,422,529

448,008,356

58,554,929

To ta l no n-de pre c ia ble a s s e ts a t his to ric a l c o s t De pre c ia ble :

Infra s truc ture To ta l de pre c ia ble a s s e ts a t his to ric a l c o s t

(977,736)

53,024,110

308,372,348

(977,736)

505,585,549

Le s s a c c um ula te d de pre c ia tio n B uildings

(17,294,458)

(3,102,111)

Im pro ve m e nts

(19,582,694)

(2,098,025)

M a c hine ry a nd e quipm e nt

(26,726,863)

(3,159,867)

Infra s truc ture To ta l a c c um ula te d de pre c ia tio n Ne t de pre c ia ble a s s e ts Go ve rnm e nta l a c tivitie s c a pita l a s s e ts , ne t

(20,396,569) (21,680,719)

756,862

(29,129,868)

(151,812,377)

(9,049,950)

(215,416,392)

(17,409,953)

756,862

(232,069,483)

232,591,964

41,144,976

(220,874)

273,516,066

299,577,913

2,350,922

66,927,270

(52,926,256)

(160,862,327)

313,578,927

B u s in e s s - t yp e a c t iv it ie s No n-de pre c ia ble : La nd

C o ns truc tio n-in-pro gre s s To ta l no n-de pre c ia ble a s s e ts a t his to ric a l c o s t

2,350,922

8,995,682

10,816,685

(1,050,705)

18,761,662

11,346,604

10,816,685

(1,050,705)

21,112,584

De pre c ia ble : B uildings

30,782,602

106,966

30,889,568

Im pro ve m e nts

10,962,111

942,971

11,905,082

M a c hine ry a nd e quipm e nt

8,963,410

44,302

(10,488)

8,997,224

30,954,585

Inta ngible wa te r rights

30,954,585

Utility pro pe rty To ta ls de pre c ia ble a s s e ts a t his to ric a l c o s t

304,743,374

9,654,584

314,397,958

386,406,082

10,748,823

(10,488)

397,144,417

Le s s a c c um ula te d de pre c ia tio n B uildings

(8,579,440)

(944,263)

(9,523,703)

Im pro ve m e nts

(5,718,699)

(250,844)

(5,969,543)

M a c hine ry a nd e quipm e nt

(4,751,078)

(576,599)

9,438

(5,318,239)

Inta ngible wa te r rights

(16,116,487)

(644,231)

(16,760,718)

Utility pro pe rty To ta l a c c um ula te d de pre c ia tio n Ne t de pre c ia ble a s s e ts B us ine s s -type c a pita l a s s e ts , ne t

(137,722,928)

(10,237,410)

(147,960,338)

(172,888,632)

(12,653,347)

9,438

(185,532,541)

213,517,450

(1,904,524)

(1,050)

211,611,876

224,864,054

8,912,161

(1,051,755)

232,724,460

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

B a la nc e a t J uly 1, 2015 C o m p o n e n t Un it s : His to ric a l P re s e rva tio n Trus t: No n-de pre c ia ble : La nd C a pita l a s s e ts , no n-de pre c ia ble De pre c ia ble : B uildings To ta ls a t his to ric a l c o s t Le s s a c c um ula te d de pre c ia tio n: M a c hine ry a nd e quipm e nt To ta ls a c c um ula te d de pre c ia tio n C a pita l a s s e ts , de pre c ia ble ne t C a pita l a s s e ts , ne t Edm o nd Ec o no m ic De ve lo pm e nt Autho rity: De pre c ia ble : M a c hine ry a nd e quipm e nt To ta ls a t his to ric a l c o s t Le s s a c c um ula te d de pre c ia tio n: M a c hine ry a nd e quipm e nt

100,450 100,450

De duc tio ns

100,450 100,450

300,495 300,495

(177,212) (177,212) 123,283

(28,503) (28,503) (28,503)

(205,715) (205,715) 94,780

195,230

(7,884) (7,884)

40,775 40,775

223,733

(28,503)

46,399 46,399

2,260 2,260

To ta l a c c um ula te d de pre c ia tio n C a pita l a s s e ts , ne t

Additio ns

B a la nc e a t J une 30, 2016

(36,115)

(2,578)

7,846

(36,115)

(2,578)

7,846

10,284

(318)

(38)

(30,847) (30,847) $

9,928

Â Depreciation expense was charged to functions in the statement of activities as follows: Depreciation expense charged to governmental activities: General government Public safety Streets and highways Culture and recreation Health and welfare

In addition, depreciation on capital assets held by the City's internal service funds is charged to the various functions based on their usage of the assets T otal governmental activities depreciation expense

934,170 2,108,756 9,299,571 2,337,397 254,748 2,475,311

17,409,953

Electric Water Sanitation Wastewater Arcadia Lake Drainage Golf Course

3,034,409 6,662,355 27,318 2,380,620 212,060 66,374 270,211

T otal business-type activities depreciation expense

12,653,347

Depreciation expense charged to business-type activities:

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

3.E. LONG-TERM DEBT The reporting entity's long-term debt is segregated by the amounts involving governmental activities, business-type activities and component units. Governmental Activities Long-Term Debt As of June 30, 2016, the governmental activities long-term debt consisted of the following: Accrued Compensated Absences: Accrued compensated absences reported in the governmental activities are comprised of accrued vacation leave. Current portion Non-current portion Total Accrued Compensated Absences

360,951 3,248,555 3,609,506

Revenue Bonds Payable: 2010 Series Sales Tax and Utility System Bonds, dated December 30, 2010, issued by the Edmond Public Works Authority, secured by utility revenues and pledged sales tax, interest rates at 2.84%, final maturity July 1, 2021. The bond’s debt service is currently paid with the restricted sales tax.

$ 7,150,000

2012 Refunding Series Sales Tax and Utility System Bonds, dated August 16, 2012, issued by the Edmond Public Works Authority, secured by utility revenues and pledged sales tax, interest rates at 2.06%, final maturity July 1, 2023. The bond’s debt service is currently paid with the restricted sales tax.

9,440,000

2013 Series Sales Tax and Utility System Bonds, dated May 14, 2013, issued by the Edmond Public Works Authority, secured by utility revenues and pledged sales tax, interest rates at 1.68%, final maturity July 1, 2023. The bond’s debt service is currently paid with the restricted sales tax.

9,925,000

2014 Refunding Series Sales Tax and Utility System Bonds, dated April 3, 2014, issued by the Edmond Public Works Authority, secured by utility revenues and pledged sales tax, interest rates at 2.47%, final maturity July 1, 2024. The bond’s debt service is currently paid with the restricted sales tax.

10,533,256

2014B Refunding Series Sales Tax and Utility System Bonds, dated December 9, 2014 issued by the Edmond Public Works Authority, secured by utility revenues and pledged sales tax, interest rate at 2.25%, final maturity July 1, 2026. The bond’s debt service is currently paid with restricted sale tax.

18,740,000

Total Revenue Bonds Payable Add: Unamortized Bond Premium Less: Deferred amount on Refunding Total Revenue Bonds Payable (Net)

55,788,256 3,927,352 (1,223,183) $ 58,492,425

Current portion, net Non-current portion, net Deferred Outflow Total Revenues Bonds Payable, net

6,529,309 53,186,299 (1,223,183) $ 58,492,425 62

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Business-type Activities Long-Term Debt As of June 30, 2016, the long-term debt payable from enterprise fund resources consisted of the following: Revenue Bonds Payable: 2014 Refunding Series Sales Tax and Utility System Bonds, dated April 3, 2014, issued by the Edmond Public Works Authority, secured by utility revenues and pledged sales tax, interest rates at 2.47%, final maturity July 1, 2024.

$9,101,894

2015 Refunding Series Sales Tax and Utility System Bonds, dated April 2, 2015, issued by the Edmond Public Works Authority, secured by utility revenues and pledged sales tax, interest rates at 1.87%, final maturity July 1, 2023.

19,615,000

Total Revenues Bonds Payable Plus: Unamortized Premium Deferred amount on refunding Total Revenues Bonds Payable (Net of unamortized discount) Current portion, net Non-current portion, net Deferred Outflow Total Revenues Bonds Payable, net

28,716,894 2,728,348 (704,868) $ 30,740,374 $ 4,445,695 26,999,547 (704,868) $ 30,740,374

Notes Payable: 2005 C Series Construction Drinking Water SRF Promissory Note to Oklahoma Water Resources Board, original issue amount of $3,726,484, secured by utility revenues and pledged sales tax, administrative fee of .5%, final maturity September 15, 2024.

$ 1,624,365

2013 Refunding General Sales Tax Revenue Note to Bank of America, original issue amount of $16,085,000 secured by utility revenues and pledged sales tax, interest rate of 2.86%, final maturity of July 1, 2026.

13,375,000 $ 14,999,365

Current portion Non-current portion Total Note Payable

$ 1,311,102 13,688,263 $ 14,999,365

Capital Lease Obligations Payable: Capital lease with Oklahoma Municipal Power Authority related to Loop Lease Program (Latham), original lease amount of $17,446, payable in monthly installments of $215, interest at 1%, final maturity July 2021.

$ 12,585

Capital lease with Oklahoma Municipal Power Authority related to Loop Lease Program (Addison), original lease amount of $14,903, payable in monthly installments of $184, interest at 1%, final maturity March 2023.

14,217

Capital lease with Oklahoma Municipal Power Authority related to Loop Lease Program (Cox), original lease amount of $12,800, payable in monthly installments of $158, interest at 1%, final maturity March 2023. 63

12,211 $ 39,013

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Current portion Non-current portion Total Note Payable

$ 6,321 32,692 $ 39,013

Accrued Compensated Absences: Accrued compensated absences reported in the business-type activities are comprised of accrued vacation leave: Current portion Non-current portion Total Accrued Compensated Absences

$ 71,900 647,012 $718,912

Component Unit Long-Term Debt Accrued Compensated Absences: Accrued compensated absences reported as a fund liability within the EEDA component unit statement of net position at June 30, 2016, are as follows: Current portion Non-current portion Total Accrued Compensated Absences

$3,178 28,606 $31,784

Changes in Long-Term Debt - Primary Government and Component Units The following is a summary of changes in long-term debt for the year ended June 30, 2016: B a la nce J uly 1, 2015

Additio ns

De duc tio ns

B a la nc e J une 30, 2016

Am o unt due in o ne ye a r

55,788,256

$ 6,529,309

3,609,506

360,951

G o v e rn m e n t a l A c tiv it ie s : R e ve nue B o nds P a ya ble

Ac c rue d C o m pe ns ate d Abs e nce s

62,153,107

3,299,595

2,969,636

$ 65,452,702

2,969,636

6,364,851 2,659,725

9,024,576

59,397,762

$ 6,890,260

1,276,102

14,999,365

B u s in e s s -t yp e A c tiv it ie s : No te P a ya ble C a pita l Le a s e Obliga tio ns P a ya ble

16,275,467

R e ve nue B o nds P a ya ble

42,725

30,443,608

Ac c rue d C o m pe ns ate d Abs e nce s

656,489

590,840

1,311,102

3,712

39,013

6,321

1,726,714

28,716,894

4,445,695

528,417

718,912

71,900 $ 5,835,018

$ 47,375,564

633,565

3,534,945

44,474,184

24,423

25,398

31,784

C o m p o n e n t Un its : Ac c rue d C o m pe ns ate d Abs e nce s

32,759

3,178

Accrued compensated absences liability is liquidated by the General Fund, Police Public Safety Limited Tax Fund, and the Fire Public Safety Limited Tax Fund. 64

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Debt Service Requirements to Maturity - Primary Government The annual debt service requirements to maturity for long-term debt as of June 30, 2016 are as follows: Gove rnme ntal-Type Activitie s Revenue Bonds Payable Year Ending June 30,

Principal

2017

Interest

6,529,309

1,911,533

2018

6,776,301

1,732,913

2019

7,035,351

1,496,060

2020

7,277,835

1,249,816

2021

7,542,508

994,638

2022-2026

20,626,952

2,016,039

T otal

55,788,256

9,400,999

Busine ss-Type Activitie s Notes Payable Year Ending June 30, 2017

Principal $

1,311,102

Revenue Bonds Payable Interest

Principal

Capital Lease Obligations Payable

Interest

Principal

Interest

382,583

4,445,695

1,181,027

6,321

358

2018

1,341,102

349,368

4,588,607

1,038,249

6,382

297

2019

1,381,102

315,223

2,488,367

881,018

6,448

231

2020

1,411,102

280,019

2,680,235

771,200

6,511

168

2021

1,451,102

243,859

2,799,734

653,138

6,579

100

2022-2026

7,568,855

637,780

11,714,256

1,163,736

6,772

535,000

7,651

$ 14,999,365

$ 2,216,483

2027 T otal

28,716,894

$ 5,688,368

39,013

1,214

Defeased Bonds Outstanding The City, through its various public trusts, has in substance defeased a number of outstanding bond issues by placing deposits in irrevocable trusts (escrow accounts) for the purchase of U.S. government securities to pay the principal and interest on the refunded bonds as they become due and payable. For financial reporting purposes, both the defeased bonds outstanding and the escrowed securities have been excluded from the financial statements. At year-end, the remaining outstanding defeased bonds were as follows: Outstanding at June 30, 2016 Primary Government: Utility System Revenue Bonds, Series 1977 $75,000 Utility System Revenue Bonds, Series 2003B 1,055,000 Utility System Revenue Bonds, Series 2004 7,410,000 Sales Tax and Utility Revenue Bonds, Series 2004 10,095,000 Sales Tax and Utility Revenue Bonds, Series 2005 19,880,000 Utility System Revenue Bonds, Series 2005 20,865,000 Total Outstanding Defeased Bonds

$59,380,000

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Line of Credit In August 2013, the City entered into an agreement with a local bank to provide an irrevocable line of credit not to exceed $22,000,000 to the City through March 31, 2017. Interest will be calculated at a floating interest rate equal to the 30 day British Bankers Association London Interbank Offered Rate (LIBOR), plus 150 basis points, provided however, that the interest rate shall not exceed the maximum rate as provided for by the laws of the State of Oklahoma. The line of credit was issued to secure funding for the Public Safety Center project. Borrowing under the credit facility is secured by the pledged sales tax. No advances were made under this credit facility. The City simultaneously authorized the issuance of a Sales Tax Revenue Note to the Hospital Trust Fund not to exceed $7,000,000 as authorized by the voters at the time of approval of a half-cent sales tax in October 2011. This is the first form of funding the City will use to fund the Public Safety Center. The City has borrowed $6.881 million of the $7 million available and will pay the entire note with interest at maturity of March 31, 2017. Further disclosure is explained in Note 3.F. Component Unit - Conduit Debt The Edmond Economic Development Authority (EEDA) has issued bonds for various industrial development projects. The following bonds were outstanding at June 30, 2016: Outstanding Original Issue June 30, 2016 EEDA - Student Housing Revenue Bonds 2001A (UCO Student Housing Foundation) $8,305,000 $6,520,000 EEDA - Revenue Note 2000 (UCO Music Lab Project) (UCO Foundation)

1,135,000 $9,440,000

582,868 $7,102,868

The bonds and notes payable comprising the Authorityâ&#x20AC;&#x2122;s indebtedness are not indebtedness of the State of Oklahoma, nor of the City of Edmond, nor is it a personal obligation of the Edmond Economic Development Authority trustees. These bonds are a limited obligation of the Authority payable solely from a portion of the Trust Estate consisting of the Authority bond and related Financing Agreement and other security outlined in the Mortgage or Loan Indentures. This debt is considered non-commitment (conduit) debt to the City and Authority since the debt payments are made solely from the notes receivable or financing agreement proceeds from Collegiate Foundation and UCO. Payments are made directly by the Collegiate Foundation and UCO to trustee banks who pay the bondholders. In the event of default by the Collegiate Foundation and UCO, the City or Authority has no obligation, in substance, to make any payments on the debt since the notes receivable, financing agreements and mortgages on the property with the industrial occupant are the only security for the debt. As a result of the non-commitment determination, the Authorityâ&#x20AC;&#x2122;s indebtedness and related receivables from industrial occupants are not recorded in the financial statements.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

3.F. INTERFUND BALANCES AND ACTIVITIES Reconciliation to fund financial statements: Primary Government Governmental Activities Other Governmental Funds

General DUE FRO M O THER FUNDS Primary Government Governmental Activities General Police Public Safety Limited Tax 2000 Capital Improvement Fund Other governmental funds Total governmental funds Internal service funds Total Total due from other funds

85,708 85,708 85,708

Total Governmental Funds

Total Governmental Activities

Internal Service Funds

85,708 85,708 85,708

18,112 18,112 18,112

103,820 103,820 103,820

85,708

18,112

103,820

85,708

DUE TO O THER FUNDS Primary Government Governmental Activities General Total governmental funds

Internal service funds

85,708

Total governmental activities

85,708

2,253

Business Type Activities Other enterprise funds Total business-type activities Total due to other funds

Reconciliation to Fund Financial Statements: Governmental Funds

87,961

Net Internal Balances

85,708

106,073

Net Internal Balance

(20,365)

292,364

290,111

2,253

18,112

396,184

2,253

396,184

Reconciliation to Statement of Net Position:

Internal Service Fund Activity report in BTA

Due to Other Funds

Internal Service Funds

Net Internal Balances

Due From Other Funds

Proprietary Funds

Total

87,961

7,811,168 $ 7,813,421

87,961

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Primary Gove rnme nt Business-type Activities Other Enterprise Funds DUE FRO M O THER FUNDS Primary Gove rnme nt Governm ental Activities General Fire Public Safety Limited T ax Police Public Safety Limited T ax 2000 Capital Improvement Fund Other governmental funds T otal governmental funds Internal service funds T otal Business Type Activities PWA-Electric PWA-Water PWA-Wastewater Other enterprise funds T otal business-type activities

2,253 2,253 2,253

T otal

115,281 174,830 290,111

Total due from othe r funds

292,364

2,253 2,253 2,253 115,281 174,830 290,111

292,364

DUE TO O THER FUNDS Business Type Activities PWA-Electric

PWA-Water

141,270

PWA-Wastewater

131,925

16,916

290,111

Other enterprise funds T otal business-type activities Total due to othe r funds

290,111

Interfund Loan The 2012 Public Safety Center Tax Fund executed a request to borrow funds from the Hospital Trust Fund as authorized by the voters not to exceed $7,000,000 to be paid back with the half-cent sales tax collections. This is recorded in the governmental fund financial statements as interfund loan receivable/payable. The first request was for $5,900,000 in February 2015 and the second amount borrowed was $981,060 for a total of $6,881,060. No principal payments have been made and interest earnings and expense at a rate of 1.2% respectfully for the year was $85,876.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Interfund transfers for the year ended June 30, 2016 were as follows: Transfer from * PWA Electric * PWA Water * PWA Water PWA Sanitation * General Fund * General Fund * General Fund * General Fund * General Fund * General Fund * General Fund * General Fund * PWA Water * 2000 Capital Improvement Fund

Transfer to General Fund General Fund General Fund General Fund Fire Public Safety Limited T ax Police Public Safety Limited T ax Capital Improvement Fund Art in Public Places PWA Arcadia Lake Citilink Fund Kickingbird Golf Course * PWA Water * PWA Electric 2012 Public Safety Capital Impr.Fund * * * * * *

Amount 662,797 63,992 12,683,815 354,737 15,207,484 18,654,514 311,000 35,217 491,069 1,200,000 60,129 12,683,815 7,702,500 4,700,000

Nature of Interfund Balance Budgeted annual operating transfer Budgeted annual operating transfer Return of pledged sales tax Budgeted annual operating transfer Dedicated sales tax- ordinance Dedicated sales tax- ordinance Budgeted annual funding Funding for public art Debt service payments Budgeted annual operating transfer Budgeted annual operating transfer Pledged sales tax- bond indenture Budgeted annual operating transfer T o offset negative fund balance

74,811,069

* Denotes major fund

Reconciliation to fund financial statements: Governmental Funds: General Fund Fire Public Safety Limited T ax Fund Police Public Safety Limit T ax Fund 2000 Capital Improvement T ax Fund 2012 Public Safety Center T ax Fund Other Governmental Funds T otal Governmental Funds Proprietary Funds: Enterprise Funds: Electric Water Other Enterprise Funds T otal Enterprise Funds T otals

T ransfer to Other Funds

T ransfers from Other Funds

$ 48,583,099 4,700,000 60,129 53,343,228

$ 13,765,341 15,207,484 18,654,514 4,700,000 346,217 52,673,556

8,365,297 12,747,807 354,737 21,467,841

20,386,315 1,751,198 22,137,513

$ 74,811,069

Re conciliation to Stateme nt of Activities: Net transfers for governmental activities: Governmental Funds T otal Net transfers for governmental activities

T ransfer to Other Funds

T ransfer from Other Funds

Net T ransfers

$ (53,343,228) $ (53,343,228)

$ 52,673,556 $ 52,673,556

$ $

(669,672) (669,672)

Net transfers for business-type activities: Enterprise Funds T otal Net transfers for business-type activities

$ (21,467,841) $ (21,467,841)

$ 22,137,513 $ 22,137,513

$ $

669,672 669,672

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Transfers between the primary government and component units for the year ended June 30, 2016 were as follows: Transfe r From

Transfe r To

General Fund

EEDA

Amount

Nature of Transfe r

576,728

Operating subsidy

3.G. FUND BALANCES AND NET POSITION The following table shows the net position restricted for other purposes shown on the Statement of Net Position:

Fund

Restricted By

Hospital T rust Ambulatory Fund

Enabling legislation Enabling legislation

Amount $ $

Asset Forfeiture Cemetery Care Fund

Statutory requirements Statutory requirements

$ $

General Fund Fire Public Safety Limited T ax Fund Police Public Safety Limited T ax Fund 2000 Capital Improvement T ax Fund Senior Center Fund Park Sales T ax Fund Art in Public Places Fund Roadway Improvement Fund 1996 Capital Improvement Fund Convention and Visitors Bureau Fund

External contracts External contracts External contracts External contracts External contracts External contracts External contracts External contracts External contracts External contracts

8,199,934 556,818 8,756,752 592,818 94,620 687,438 2,889,481 11,247,640 6,783,862 29,253,300 238,743 1,964,251 66,014 10,199 141,718 104,165 52,699,373

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

The following table shows the fund balance classifications as shown on the Governmental Funds Balance Sheet in accordance with GASB Statement 54: M a jo r Go ve rnm e nta l F unds

Ge ne ra l F und

F ire P ublic S a fe ty Ta x

2000 C a pita l P o lic e P ublic Im pro ve m e nt Ta x S a fe ty Ta x

Othe r 2012 P ublic S a fe ty C e nte r Go ve rnm e nta l F und Ta x To ta l

F und B a la nc e R e s tric te d F o r: P o lic e o pe ra tio ns F ire o pe ra tio ns

11,247,640

6,771,548

6,771,548 11,247,640

Ho s pita l s a le trus t

8,199,934

Am bula nc e s e rvic e s

556,818

Ec o no m ic de ve lo pm e nt

104,165

C a pita l im pro ve m e nts

141,718

29,395,018

S tre e t im pro ve m e nts

10,199

Art in public pla c e s

66,014

66,014 1,964,251

29,253,300

C ulture a nd re c pro gra m s

1,964,251

C e m e te ry im pro ve m e nts

94,620

S e nio r c e nte r pro gra m s

238,743

592,818

P o lic e -drug pro gra m s J uve nile c o urt pro gra m s S tre e t a nd a lle y o pe ra tio ns Tra ns po rta tio n R o a dwa y wide ning S ub-to ta l re s tric te d

683,776

592,818

683,776 1,876,686

1,876,686

3,215

325,804

2,889,481

11,247,640

6,771,548

29,253,300

11,969,280

62,131,249

C o m m itte d fo r: S e nio r c e nte r pro gra m s

8,902

S ub-to ta l c o m m itte d

8,902

As s igne d fo r: -

1,241,599

4,083,860

C ulture a nd re c pro gra m s

C a pita l im pro ve m e nts

42,081

239,537

281,618

C e m e te ry im pro ve m e nts

4,256

Art in public pla c e s

7,289

S tre e t im pro ve m e nts

817

P o lic e o pe ra tio ns

830,380

F ire o pe ra tio ns Ec o no m ic de ve lo pm e nt

954,359

2,842,261

830,380

629,968

817

629,968

18,401

972,760 31,383

P o lic e -drug pro gra m s

31,383

S e nio r c e nte r pro gra m s

10,141

Am bula nc e s e rvic e s

11,821

S upple m e nt o f ne xt fis c a l ye a rs budge t S ub-to ta l a s s igne d Una s s igne d (de fic it): TOTAL F UND B ALANC E

124,430 1,120,870 3,142,639 $ 7,152,990

629,968 $ 11,877,608

830,380 $

7,601,928

2,842,261

32,095,561

(1,998,210) $

1,565,244 (903)

(1,998,210) $ 13,542,523

124,430 6,988,723 1,143,526 $ 70,272,400

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Prior Period Adjustments The Asset Forfeiture Fund no longer met the definition of a special revenue fund per GASB Statement 54 and was moved to an account of the General Fund. This resulted in beginning fund balance of the General Fund to increase by $153,553 and beginning fund balance of the non-major governmental funds to decrease by $153,553. NOTE 4. OTHER NOTES 4.A. EMPLOYEE PENSION AND OTHER BENEFIT PLANS The City participates in three employee pension systems as follows: Name of Plan/System

Type of Plan

Oklahoma Police Pension and Retirement Fund

Cost Sharing Multiple Employer - Defined Benefit Plan

Oklahoma Firefighters Pension and Retirement Fund

Cost Sharing Multiple Employer - Defined Benefit Plan

City of Edmond Employees' Retirement System

Single Employer - Defined Benefit Plan

The aggregate net pension liability, deferred inflows, deferred outflows and pension expense for the plans at June 30, 2016: Deferred Outflow Police Pens ion

Fire Pens ion

Deferred Inflow $

1,212,356

2,263,468

Single Employer Plan Totals

1,401,329

2,840,322

6,688,726 $

10,353,523

Net Pens ion Liability $

4,088,477

Pens ion Expens e $

37,851,799

35,799 $

127,846 13,407,344

51,386,989

47,464,225

495,877 3,219,594 2,508,031

6,223,502

Reconciliation to government-wide financials ; Governmental Buss ines s -type

3,766,055

Component unit

156,709 $

51,386,989

Oklahoma Police and Firefighter's Pension and Retirement Systems The City of Edmond, as the employer, participates in two statewide cost-sharing multiple employer defined benefit plans on behalf of the police officers and firefighters. The systems are funded by contributions from participants, employers, insurance premium taxes, and state appropriations, as necessary. The following is a summary of eligibility factors, contribution methods, and benefit provisions.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Oklahoma Police Pension and Retirement System

Oklahoma Firefighter Pension and Retirement System

Obtaining separately issued financial statements

Police Pension and Retirement 1001 N.W. 63rd St., Suite 605 Oklahoma City, OK 73116-7335

Firefighters Pension & Retirement 4545 N. Lincoln Blvd., Suite 265 Oklahoma City, OK 73105-3414

Eligibility to participate

All full-time officers, employed by a participating municipality, not less than 21 years of age or more than 45 years of age when hired.

All full-time or voluntary firefighters of a participating municipality hired before age 45.

Authority establishing contribution obligations and benefits

State Statute

Employee's contribution rate (percent of covered payroll)

City's contribution rate (percent of covered payroll)

13%

14%

State obligation

State appropriation to fund the unfunded actuarial accrued liability

Period required to vest

10 years

Eligibility and benefits for distribution (full-time)

20 years credited service, 2.5% of final average salary multiplied by the years of credited service with a maximum of 30 years considered; if vested, at or after age 50, or after 10 but before 20 years of credited service, with reduced benefits.

20 years credited service 2.5% of final average salary multiplied by the years of credited service with a maximum of 30 years considered; if vested, at or after age 50, or after 10 but before 20 years of credited service, with reduced benefits.

Deferred retirement option

Yes, 20 years credited service with additional option to participate in a Back D.O.P

Yes, 20 years credited service with continued service for a maximum of 30 or more years.

Yes

Yes, if vested by 5/83

Yes

Yes Yes

Provisions for: Cost of living adjustments (normal retirement) Death (duty, non-duty, post retirement) Disability (duty, non-duty) Cost of living allowances

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Trend Information Oklahoma Police Pension and Retirement System: Contributions to the police pension plan from the City were $1,305,813. The State of Oklahoma also made onbehalf contributions to OPPRS in the amount of $1,209,659 that is reported as both a revenue and an expenditure in the General Fund Statement of Revenues, Expenditures, and Changes in Fund Balance. In the government-wide Statement of Activities, revenue is recognized for the state’s on-behalf contributions on an accrual basis of $1,112,774. These on-behalf payments did not meet the criteria of a special funding situation. Oklahoma Firefighters Pension and Retirement System: Contributions to the fire pension plan from the City were $1,474,042. The State of Oklahoma also made on-behalf contributions to OPPRS in the amount of $3,632,498 that is reported as both a revenue and an expenditure in the General Fund Statement of Revenues, Expenditures, and Changes in Fund Balance. In the government-wide Statement of Activities, revenue is recognized for the state’s on-behalf contributions on an accrual basis of $3,253,639. These on-behalf payments did not meet the criteria of a special funding situation. Net Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions Oklahoma Police Pension and Retirement System: At June 30, 2016, the City reported a liability of $127,846 for its proportionate share of the Police net pension liability. The net pension liability was measured as of June 30, 2015, and the total pension liability used to calculate the net pension liability was based on the City’s contributions received by the pension plan relative to the total contributions received by the pension plan for all participating employers as of June 30, 2015. Based upon this information, the City’s proportion was 3.1355 percent. For the year ended June 30, 2016, the City recognized pension expense of $495,877. At June 30, 2016, the City reported deferred outflows of resources and deferred inflows of resources related to pension from the following sources: Deferred Outflows

Deferred Inflows

of Resources

Difference between expected and actual experience

706,938

Net difference between projected and actual earnings on pension plan investments

Changes in proportion City contributions during measurement date

491,945

95,516

13,473

City contributions subsequent to the measure date

1,305,813

Total

1,401,329

$ 1,212,356

The $1,305,813 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2017. Any other amounts reported as deferred outflow of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: 74

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Year ended June 30: 2017

(505,250)

2018

(505,250)

2019

(505,250)

2020

439,073

2021

(40,163) $

(1,116,840)

Oklahoma Firefighters Pension and Retirement System: At June 30, 2016, the City reported a net pension liability of $37,851,799 for its proportionate share of the total net pension liability. The net pension liability was measured as of June 30, 2015, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of July 1, 2015. The City’s proportion of the net pension liability was based on the City’s contributions received by the pension plan relative to the total contributions received by pension plan for all participating employers as of June 30, 2015. Based upon this information, the City’s proportion was 3.5662 percent. For the year ended June 30, 2016, the City recognized pension expense of $3,219,594. At June 30, 2016, the City reported deferred outflows of resources and deferred inflows of resources related to pension from the following sources:

Changes of assumptions

Deferred Outflows

Deferred Inflows

of Resources

747,832

Net difference between projected and actual earnings on pension plan investments

Changes in proportion City contributions during measurement date

2,821,580

41,594

18,742

City contributions subsequent to the measure date

1,474,042

Total

2,263,468

2,840,322

The $1,474,042 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2017. Any other amounts reported as deferred outflow of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Year ended June 30: 2017

(871,273)

2018

(871,273)

2019

(871,273)

2020

516,541

2021

42,903

thereafter

3,479 $

(2,050,896)

Actuarial Assumptions Oklahoma Police Pension and Retirement System: The total pension liability was determined by an actuarial valuation as of July 1, 2015, using the following actuarial assumptions, applied to all prior periods included in the measurement: Inflation:

Salary increases:

4.5% to 17% average, including inflation

Investment rate of return:

7.5% net of pension plan investment expense

M ortality rates:

Active employees (pre-retirement) RP-2000 Blue Collar Healthy Combined table with age set back 4 years with fully generational improvement using Scale AA. Active employees (post-retirement) and nondisabled pensioners: RP-2000 Blue Collar Healthy Combined table with fully generational improvement using Scale AA. Disabled pensioners: RP-2000 Blue Collar Healthy Combined table with age set forward 4 years with fully generational improvement using Scale AA.

The actuarial assumptions used in the July 1, 2015, valuation were based on the results of an actuarial experience study for the period July 1, 2007, to June 30, 2012. The long-term expected rate of return on pension plan investments were determined using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense, and inflation) are developed for each major asset class. These ranges are combined to produce the longterm expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the pension planâ&#x20AC;&#x2122;s target asset allocation as of June 30, 2015, are summarized in the following table: Long-Term Expected Asset Class

Real Rate of Return

Fixed income

2.24%

Domestic equity

4.87%

International equity

7.68%

Real estate

5.47%

Private equity

5.80%

Commodities

2.96%

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

The current allocation policy is that approximately 60% of assets in equity instruments, including public equity, long-short hedge, venture capital, and private equity strategies; approximately 25% of assets in fixed income to include investment grade bonds, high yield and non-dollar denominated bonds, convertible bonds, and low volatility hedge fund strategies; and 15% of assets in real assets to include real estate, commodities, and other strategies.

Oklahoma Firefighters Pension and Retirement System: The total pension liability was determined by an actuarial valuation as of July 1, 2015, using the following actuarial assumptions, applied to all prior periods included in the measurement: Inflation:

Salary increases:

3.5% to 9.0% average, including inflation

Investment rate of return:

7.5% net of pension plan investment expense

Mortality rates were based on the RP2000 combined healthy with blue collar adjustment as appropriate, with adjustments for generational mortality improvement using scale AA for healthy lives and no mortality improvement for disabled lives. The actual assumptions used in the July 1, 2015 valuation were based on the results of an actuarial experience study for the period July 1, 2007, to June 30, 2012. The long-term expected rate of return on pension plan investments were determined using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense, and inflation) are developed for each major asset class. These ranges are combined to produce the longterm expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan’s target asset allocation as of June 30, 2015, are summarized in the following table: Asset Class

Target

Long-Term Expected

Allocation

Real Rate of Return

Fixed income

20%

5.13%

Domestic equity

37%

8.02%

International equity

20%

9.94%

Real estate

10%

7.47%

Other assets

13%

6.25%

Discount Rate Police and Fire Pensions discount rate used to measure the total pension liability was 7.5%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current contribution rate and that contributions from employers will be made at contractually required rates, determined by State statues. Projected cash flows also assume the State of Oklahoma will continue contributing 14% for Police and 36% for Fire of the insurance premium, as established by statute. Based on these assumptions, the pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability of the employers calculated using the discount rate of 7.5%, as well as what the Plan’s net pension liability would be if it were calculated using a discount rate with is 1-percentage point lower (6.5%) or 1-percentage point higher (8.5%) than the current rate:

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

1% Decrease

Current Discount

1% Increase

(6.5%)

Rate (7.5%)

(8.5%)

Police Pension net pension liability (asset)

7,681,910

127,846

(6,240,755)

Fire Pension net pension liability

49,146,591

37,851,799

28,378,805

Pension plan fiduciary net position Detailed information about the pension plan’s fiduciary net position is available in the separately issued financial report of the OPPRS; which can be located at www.ok.gov/OPPRS and the FPRS; which can be located at www.ok.gov/FPRS.

Edmond Employees Retirement System - Single-Employer, Defined Benefit Pension Plan Plan Description, Contribution Information, and Funding Policies The City contributes to the City of Edmond Employees' Retirement System (the "System"), which is a single employer defined benefit pension plan administered by the City of Edmond Administrative Committee. All nonunion full-time City employees are eligible to participate in the System. The City’s retirement ordinance requires that actuarial valuations be performed in each even-numbered year to determine if the City’s fixed contribution rate is adequate to fund the actuarially determined contribution requirement. The System does not issue separate annual financial statements. The System and the City have a June 30th year-end. The City has elected to use the preceding year-end of the System as its measurement date; therefore, net pension liability and related deferred inflows are reported as of June 30, 2015. The System’s pension liability was based on an actuarial valuation as of June 30, 2015. Pension payments made by the City from the measurement date to June 30, 2016 are reported as deferred outflows. Summary of Significant Accounting Policies For purposes of measuring the net pension liability, deferred outflows or resources and deferred inflows of resources related to pensions, and pension expense, amounts and disclosures have been prepared using the accrual basis of accounting. Employee and employer contributions are recognized as System revenues in the period in which they are due to the plan. Benefits and refunds are recognized when due and payable pursuant to plan provisions. Investments are reported at fair value. Method Used to Value Investments - Values of System assets are reported at fair value market. As of June 30, 2016, the System held no related party investments or individual investments (other than U.S. government and U.S. government guaranteed securities) whose market value exceeds five percent or more of the net position available for benefits. Eligibility Factors and Benefit Provisions Year established and governing authority

1966; City Council Ordinance

Determination of Contribution requirements

City Ordinance; actuarially determined

Employer

8.99% - The city used the prior year actuarial determined employer contributions rate of 8.61% in fiscal year 2016

Plan members

5.25% 78

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Funding of administrative costs

Investment earnings

Period required to vest

7 years

Eligibility for distribution

Age 65, or age 55 with seven years credited service

Provisions for: Disability benefits Death benefits

Yes Yes

Benefits paid:

Calculated on the average gross salary of a participantâ&#x20AC;&#x2122;s earnings during the highest 30 consecutive months of the last five years of credited service. Gross salary does not include payment of accumulated sick or annual leave upon termination of employment.

The City is required to contribute 8.99% of covered payroll to the System, however, the City elected to contribute 8.61% which was the actuarial determined contribution rate from the prior year. These amounts were actuarially determined. System participants of the City contributed $1,384,043 during fiscal year 2016, and the City contributed $2,265,553. The Component Unit (EEDA) is also required to contribute 8.99% of covered payroll to the System. These amounts were actuarially determined. System participants of EEDA contributed $16,337 during fiscal year 2016, and EEDA contributed their portion of $26,794. Plan Membership Non-vested active members Fully vested active members

191 270

Total Active members

461

Non-active retired, beneficiaries, disabled and deferred vested participants Total Plan Participants

169 630

Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At June 30, 2016, the City reported a liability of $13,250,635 and the EEDA component unit $156,709 for their proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2015, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of July 1, 2015. There were no changes in assumptions or changes in benefit terms that affected measurement of the total pension liability. There were also no changes between the measurement date of July 1, 2015 and the Cityâ&#x20AC;&#x2122;s report ending date of June 30, 2016, that would have had a significant impact on the net pension liability. The following table reports the components of changes in net pension liability:

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Balances at beginning of year, 7/1/2014

Total Pension

Plan Net

Net Pension

Liability

Position

Liability

71,889,808

66,089,862

5,799,946

Changes for the year: Service cost

2,619,414

Interest expense

5,193,616

Contributions – employer

2,108,839

(2,108,839)

Contributions – employee

1,338,561

(1,338,561)

(2,627,009)

2,627,009

Net investment income

Benefits paid

(3,135,897)

Difference between actual and expected experience

(3,135,897)

584,011

Plan administrative expenses Net changes Balances at end of year, 7/1/2015

584,011

(30,748)

30,748

5,261,144

(2,346,254)

7,607,398

77,150,952

63,743,608

$ 13,407,344

For the year ended June 30, 2016, the City recognized pension expense of $2,508,031 and EEDA recognized pension expense of $29,452. At June 30, 2016, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: City

Component Unit

Deferred Outflows

Deferred Inflows

Deferred Outflows

Deferred Inflows

of Resources

Difference between expected and actual experience

989,506

11,703

Net difference between projected and actual earnings on pension plan investments

3,396,680

Change in proportion

36,987

40,170

35,799

1,193

City contributions subsequent to the measure date

2,265,553

26,794

Total

6,688,726

35,799

78,667

1,193

The City’s $2,265,553 and EEDA’s $26,794 reported as deferred outflows of resources related to pensions resulting from contributions subsequent to the measurement date will be recognized as a decrease of the net pension liability in the year ended June 30, 2017. Other amounts will be reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: Year ended June 30: 2017

City

Component Unit

(825,326)

(9,553)

2018

(825,326)

(9,553)

2019

(825,326)

(9,553)

2020

(1,651,174)

(19,320)

2021

(182,618)

(1,952)

thereafter

(77,604) $ (4,387,374)

(749) $

(50,680)

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Actuarial Assumptions Key assumptions used in the plan actuarial valuation were: Discount Rate

7.25%

Long-term expected rate of return

7.25%

M easurement date

7/1/2015

Inflation

2.50%

Projected salary increase*

Age-related

M ortality

RP 2000 projected with cohort projection

Retirement rates*

Experience

Turnover*

Experience

Actuarial cost method

Entry Age Normal

* In 2011 a detailed study was completed of the Retirement Systemâ&#x20AC;&#x2122;s demographic experience over the proceeding seven years. As a result, the Actuary recommended and the Systemâ&#x20AC;&#x2122;s Administrative Committee approved new assumptions based on actuarial experience. The assumption changes included a revised schedule of age-related retirement rates, age-related assumed pay increases replaced the 5% pay increase assumption and a new turnover assumption based on both age and employee years of service was implemented. These updates represent an ongoing and continuing process of refining prior assumptions. No changes in assumptions were made during fiscal year 2016. The City has adopted a funding method that is designed to fund all benefits payable to participants over the course of their working careers. Any differences between actual and expected experience are funded over a fixed period to ensure all funds necessary to pay benefits have been contributed to the trust before those benefits are payable. Therefore, the sufficiency of pension plan assets was made without a separate projection of cash flows. The long-term expected rate of return on pension plan investments was determined using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense, and inflation) are developed for each major asset class. These ranges are combined to produce the longterm expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation (2.5%) and deducting expenses. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan's target asset allocation as of June 30, 2015, are summarized in the following table: Asset Class Domestic equity

Target

Long-Term Expected

Allocation

Real Rate of Return

20%

6.0%

International equity

23%

6.2%

Fixed income

29%

2.5%

28%

6.3%

Real estate, commodities and partnerships

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Discount Rate The discount rate used to measure the total pension liability was 7.25%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the actuarially determined contribution amounts. Based on the assumption, the pension planâ&#x20AC;&#x2122;s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return was adjusted to all periods of projected benefit payments to determine the total pension liability. Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability of the employers calculated using the discount rate of 7.25%, as well as what the Plan's net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.25%) or 1-percentage-point higher (8.25%) than the current rate: 1%

Current

Decrease

Discount

Increase

(6.25%)

Rate (7.25%)

(8.25%)

Employer's Total Pension Liability Employer's Net Pension Liability - 2015

24,075,571

13,407,344

4,546,913

Employer's Net Pension Liability - 2016

31,333,073

19,919,370

10,438,994

The components of the net pension liability of the City June 30, 2015 and 2016, were as follows: 2015 Total Net Pension Liability

Plan fiduciary Net Position

2016

77,150,952

63,743,608

Net Pension Liability

Plan Fiduciary Net Position as a percentage of

13,407,344 82.62%

82,657,036 62,737,666

19,919,370 75.90%

the total pension liability

Other Post-Employment Benefits Plan Description: City provides post-retirement benefit options for health care, prescription drug, dental and vision benefits for retired employees and their dependents that elect to make required contributions. The benefits are provided in accordance with State law, police and firefighter's union contracts and the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). The relationship for these benefits is not formalized in a contract or plan document, only a few sentences in the administrative policy. These benefits are considered for accounting purposes to be provided in accordance with a single employer substantive plan. A substantive plan is one in which the plan terms are understood by the city and plan members. This understanding is based on communications between the employers and plan member and the historical pattern of practice with regard to the sharing of benefit costs. Substantially all of the government's employees may become eligible for those post-retirement benefits if they reach normal retirement age while working for the City. As of June 30, 2016, approximately 49 retired employees and 17 survivors are receiving benefits under this plan. Funding Policy. The contribution requirement of the City is an implicit subsidy. The implicit subsidy is not a direct payment from the employer on behalf of the member but rather stems from retiree contribution levels that are less than the claims cost at retiree ages. Since claims experience for employees and non-Medicare eligible retirees 82

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

are pooled when determining premiums, these retired members pay a premium based on a pool of members that, on average, are younger and healthier. There is an implicit subsidy from the employee group since the premiums paid by the retirees are lower than they would have been if the retirees were insured separately. The subsidies are valued using the difference between the age-based claims costs and the premium paid by the retiree. The amount required to fund the implicit rate is based on projected pay-as-you-go financing requirements. For fiscal year 2016, the City contributed $162,326 to the plan. Plan members receiving benefits contributed $341,577, or approximately 62% percent of the value of coverage, through their required contribution of $443.89 per month for retiree-only Standard option coverage and $1,095.62 for retiree and family medical Standard option coverage. Retirees have the option to upgrade to the Enhanced option. Retirees who elected Standard option dental coverage contributed $38.70 for retiree only and $94.07 for retiree and family coverage per month. Retirees have the option to Buy Up on their dental plan for an additional $12.00 per month for retiree-only coverage or $46.00 for retiree and family coverage per month. Retirees who elected vision coverage contributed $6.96 for retiree only coverage and $16.87 for retiree and family coverage per month. Annual OPEB Cost and Net OPEB Obligation. The City's annual other postemployment benefit (OPEB) cost (expense) is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years. The following table shows the components of the City's annual OPEB cost, the amount actually contributed to the plan, and changes in the Cityâ&#x20AC;&#x2122;s net OPEB obligation for the year ended June 30, 2016: Annual required contribution

Interest on net OPEB obligation

772,339 101,480

Adjustment to annual required contribution

(320,778)

Annual OPEB cost (expense)

553,041

Contributions made

(162,326)

Increase in net OPEB obligation

390,715

Net OPEB obligation-beginning of year

2,757,465

Net OPEB obligation-end of year

3,148,180

The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net unfunded OPEB obligation for 2016 was as follows: Net Employer Cont ribut ion

Percentage of Annual OPEB Cost Contributed

Net OPEB Obligation

Fiscal Year

Annual OPEB Cost

6/30/2009

445,942

137,552

31%

308,390

6/30/2010

461,362

142,366

31%

627,386

6/30/2011

443,179

144,403

33%

926,162

6/30/2012

520,882

144,402

28%

1,302,641

6/30/2013

597,062

188,856

32%

1,710,847

6/30/2014

600,226

188,858

31%

2,122,215

6/30/2015

740,937

105,686

14%

2,757,465

6/30/2016

553,041

162,326

29%

3,148,180

Funded Status and Funding Progress. As of June 30, 2016, the most recent actuarial valuation date, the plan was 0 percent funded. The actuarial accrued liability for benefits was $5.3 million, and the actuarial value of assets was zero, resulting in an unfunded actuarial accrued liability (UAAL) of $5.3 million. The covered payroll (annual 83

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

payroll of active employees covered by the plan) was $37.5 million, and the ratio of the UAAL to the covered payroll was 14 percent. 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 trend. Amounts determined regarding the funded status of the plan and the annual required 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 about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. The schedule of funding progress, presented at 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 liability for benefits. 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 the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. Actuarial cost method Amortization method Remaining amortization period Inflation rate Asset valuation method Investments return Projected salary increases Cost of living adjustments Healthcare cost trend rate

Entry Age Normal level payments, open 23 years 2.5% 3.0% (discount rate) N/A (unfunded) N/A N/A 6.12% in 2016 graded to 4.87% in 2060

4.B. RISK MANAGEMENT The City is exposed to various risks of loss related to torts, theft of, damage to, or destruction of assets; errors and omissions; injuries to employees; employeeâ&#x20AC;&#x2122;s health and life; and natural disasters. The City manages these various risks of loss as follows: Type of Loss

Method Managed

Risk of Loss Retained

a. General Liability: - Torts - Errors and omissions - Police liability - Vehicle

City has insurance coverage for General Liability coverage. All claims are submitted to a third party administrator for determination of liability. Claims below the self insured retention (SIR) are accounted for within the Liability Tort Claim Fund.

City retains risk of losses up to $100,000 SIR per occurrence with excess coverage up to $5,000,000

b. Physical Property: - Theft - Damage to assets - Natural disasters

City has insurance coverage for Property & Contents and Boiler & Machinery. Claims for losses are submitted to insurance provider for reimbursement of losses.

City retains risk of loss up to the deductible amount of $10,000 for property and $10,000 for B & M. Coverage amounts vary by type of loss.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

c. Workers Compensation: - Employee injuries

Self-insured with third-party administration of the claims process. Liability Tort Claim Fund used to account for activities with participating funds charged through an estimated annual claim cost for each fund. Administered by Cannon Cochran Management Services, Inc.

City retains risk of loss for first $450,000 or $750,000 of damage per occurrence depending on job classification. Stop loss insurance carried for damages above the City deductible up to a maximum aggregate of $2,000,000 per occurrence.

d. Health and Life: - Medical - Dental - Vision - Life and ADD - LTD

Self-insured with City paying a portion of health care premiums, and all of life, ADD and LTD premiums. Administered by Aetna and Unum.

Claims up to $130,000 per individual self-funded with stop-loss insurance up to $1,000,000 per person.

The City maintains a stop-loss policy for plans to limit risk associated with the plans. For insured programs, there have been no significant reductions in insurance coverage. Settlement amounts have not exceeded insurance coverage for the current year or the four prior years. Claims Liability Analysis The claims liabilities related to the above noted risks of loss that are retained are determined in accordance with the requirements of Statement of Financial Accounting Standards No. 5., which requires that a liability for claims be reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated. The City has elected to report its estimated claim liability at the discounted net present value of future payments. For the internal service self-insurance funds, changes in the claims liability for the City from July 1, 2014 to June 30, 2016, are as follows: Workers' Compensation Claim liability, June 30, 2014 Claims and changes in estimates Claims payments Claim liability, June 30, 2015 Claims and changes in estimates Claims payments Claim liability, June 30, 2016

1,325,000 684,568 (928,568) 1,081,000 462,328 (463,328) 1,080,000

Reconciliation to Statement of Net Position: Current portion

Health Care $

431,354 7,901,956 (7,966,779) 366,531 7,275,964 (7,334,309) 308,186

T ort $ 1,120,000 711,951 (175,951) $ 1,656,000 138,216 (259,216) $ 1,535,000

T otal $ 2,876,354 9,298,475 (9,071,298) $ 3,103,531 7,876,508 (8,056,853) $ 2,923,186

$ 1,080,140

Noncurrent portion

1,843,046

T otal

$ 2,923,186

4.C. COMMITMENTS AND CONTINGENCIES Construction Commitments At June 30, 2016, the City had awarded construction contracts totaling $45,505,978 for various City and EPWA projects and of this amount, $11,161,267 was outstanding and payable from various funds. 85

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Contingencies Grant Program Involvement In the normal course of operations, the City participates in various federal or state grant/loan programs from year to year. The grant/loan programs are often subject to additional audits by agents of the granting or loaning agency to ensure compliance with specific provisions of the grant or loan. Any liability or reimbursement which may arise as a result of these audits cannot be reasonably determined at this time, although it is believed the amount, if any, would not be material. Litigation The City is a party to various legal proceedings which normally occur in the course of governmental operations. The financial statements do not include accrual or provisions for loss contingencies that may result from these proceedings. State statutes provide for the levy of an ad valorem tax over a three-year period by a City Sinking Fund for the payment of any court assessed judgment rendered against the City. This statutory taxing ability is not available to the Cityâ&#x20AC;&#x2122;s public trusts (Authorities). While the outcome of the above noted proceedings cannot be predicted, due to the insurance coverage maintained by the City and the State statute relating to judgments, the City feels that any settlement or judgment not covered by insurance would not have a material adverse effect on the financial condition of the City.

4.D. NEW ACCOUNTING PRONOUNCEMENTS The GASB has issued several new accounting pronouncements, which will be effective in subsequent years. A description of the new accounting pronouncements, the fiscal year in which they are effective, and the Cityâ&#x20AC;&#x2122;s consideration of the impact of these pronouncements are described below: Statement No. 73, Accounting and Financial Reporting for Pensions and Related Assets That Are Not Within the Scope of GASB Statement 68, And Amendments To Certain Provisions of GASB Statement 67 and 68. This Statement establishes requirements for defined benefit pensions that are not within the scope of Statement No. 68, Accounting and Financial Reporting for Pensions, as well as for the assets accumulated for purposes of providing those pensions. In addition, it establishes requirements for defined contribution pensions that are not within the scope of Statement 68. It also amends certain provisions of Statement No. 67, Financial Reporting for Pension Plans, and Statement 68 for pension plans and pensions that are within their respective scopes. The Statement is effective for fiscal years beginning after June 15, 2016. The City has not yet determined the impact that implementation of GASB 73 will have on its net position. Statement No. 74, Financial Reporting for Postemployment Benefits Plans Other Than Pension Plans. This Statement replaces Statements No. 43, Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans, as amended, and No. 57, OPEB Measurements by Agent Employers and Agent Multiple-Employer Plans. It also includes requirements for defined contribution OPEB plans that replace the requirements for those OPEB plans in Statement No. 25, Financial Reporting for Defined Benefit Pension Plans and Note Disclosures for Defined Contribution Plans, as amended, Statement 43, and Statement No. 50, Pension Disclosures. This Statement is effective for financial statements for fiscal years beginning after June 15, 2016. The City has not yet determined the impact that implementation of GASB 74 will have on its net position. Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions. This Statement replaces the requirements of Statements No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions, as amended, and No. 57, OPEB Measurements by Agent Employers and Agent Multiple-Employer Plans, for OPEB. Statement No. 74, Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans, establishes new accounting and financial reporting requirements for OPEB plans. This Statement is effective for fiscal years beginning after June 15, 2017. The City has not yet determined the impact that implementation of GASB 75 will have on its net position. 86

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

GASB Statement No. 77, Tax Abatement Disclosures - GASB 77 was issued in August 2015, and establishes financial reporting standards for tax abatement agreements entered into by state and local governments. The disclosures required by this Statement encompass tax abatements resulting from both (a) agreements that are entered into by the reporting government and (b) agreements that are entered into by other governments and that reduce the reporting governmentâ&#x20AC;&#x2122;s tax revenues. The requirements of this Statement are effective for financial statements for periods beginning after December 15, 2015. The City has not yet determined the impact that implementation of GASB 77 will have on its net position. GASB Statement No. 78, Pensions Provided Through Certain Multiple-Employer Defined Benefit Pension Plans - GASB 78 was issued in December 2015, and amends the scope and applicability of Statement 68 to exclude pensions provided to employees of state or local governmental employers through a cost-sharing multiple employer defined benefit pension plan that (1) is not a state or local governmental pension plan, (2) is used to provide defined benefit pensions both to employees of state or local governmental employers and to employees of employers that are not state or local governmental employers, and (3) has no predominant state or local governmental employer (either individually or collectively with other state or local governmental employers that provide pensions through the pension plan). This Statement establishes requirements for recognition and measurement of pension expense, expenditures, and liabilities; note disclosures; and required supplementary information for pensions that have the characteristics described above. The requirements of this Statement are effective for reporting periods beginning after December 15, 2015. At this time, the impact to the City is unknown. GASB Statement No. 79, Certain External Investment Pools and Pool Participants - GASB 79 was issued in December 2015, and addresses accounting and financial reporting for certain external investment pools and pool participants. Specifically, it establishes criteria for an external investment pool to qualify for making the election to measure all of its investments at amortized cost for financial reporting purposes. An external investment pool qualifies for that reporting if it meets all of the applicable criteria established in this Statement. The specific criteria address (1) how the external investment pool transacts with participants; (2) requirements for portfolio maturity, quality, diversification, and liquidity; and (3) calculation and requirements of a shadow price. Significant noncompliance prevents the external investment pool from measuring all of its investments at amortized cost for financial reporting purposes. Professional judgment is required to determine if instances of noncompliance with the criteria established by this Statement during the reporting period, individually or in the aggregate, were significant. The requirements of this Statement are effective for reporting periods beginning after June 15, 2015, except for certain provisions on portfolio quality, custodial credit risk, and shadow pricing. Those provisions are effective for reporting periods beginning after December 15, 2015. At this time, the impact to the City is unknown. GASB Statement No. 80, Blending Requirements for Certain Component Units - An Amendment of GASB Statement No. 14 â&#x20AC;&#x201C; GASB 80 was issued in January 2016, and amends the blending requirements for the financial statement presentation of component units of all state and local governments. The additional criterion requires blending of a component unit incorporated as a not-for profit corporation in which the primary government is the sole corporate member. The additional criterion does not apply to component units included in the financial reporting entity pursuant to the provisions of Statement No. 39, Determining Whether Certain Organizations Are Component Units. The requirements of this Statement are effective for reporting periods beginning after June 15, 2016. At this time, the impact to the City is unknown. GASB Statement No. 81, Irrevocable Split-Interest Agreements - GASB 81 was issued in March 2016, to improve accounting and financial reporting for irrevocable split-interest agreements by providing recognition and measurement guidance for situations in which a government is a beneficiary of the agreement. The City does not believe that GASB No. 81 will have significant impact on its financial statements. GASB Statement No. 83, Certain Asset Retirement Obligations, issued December 2016, will be effective for the City beginning with its fiscal year ending June 30, 2019. Under Statement No. 83, a government that has legal obligations to perform future asset retirement activities related to its tangible capital assets is required to recognize a liability and a corresponding deferred outflow of resources. The Statement identifies the circumstances that trigger the recognition of these transactions. The Statement also requires the measurement of an asset retirement obligation to be based on the best estimate of the current value of outlays expected to be incurred while the deferred outflow of resources associated with the asset retirement obligation will be measured at the amount of the corresponding 87

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

liability upon initial measurement and generally recognized as an expense during the reporting periods that the asset provides service. The Statement requires disclosures including a general description of the asset retirement obligation and associated tangible capital assets; the source of the obligation to retire the assets; the methods and assumptions used to measure the liability; and other relevant information. GASB Statement 84, Fiduciary Activities, issued January 2017, will be effective for the City for the City beginning with its fiscal year ending June 30, 2019. This Statement establishes criteria for identifying fiduciary activities of all state and local governments. The focus of the criteria generally is on (1) whether a government is controlling the assets of the fiduciary activity and (2) the beneficiaries with whom a fiduciary relationship exists. Separate criteria are included to identify fiduciary component units and postemployment benefit arrangements that are fiduciary activities. The City has not yet determined the impact that implementation of GASB 84 will have on its net position. 4.E. ECONOMIC DEVELOPMENT The City is party to multiple agreements for the purpose of developing the Interstate 35 corridor within its city limits. In fiscal 2012, the City purchased land along the corridor for $2.2 million for the development of a hotel and conference center. Subsequently, the City entered into a development agreement and committed to lend $4.8 million towards the cost of constructing the conference center. The developer is responsible for financing the cost of the related hotel and expenditures for the Conference Center that exceed $4.8 million. Rental payments to the City for the use of the underlying land are one dollar a year. The hotel will be privately owned and managed. Based on terms of the contract, the developer may purchase the land and conference center from the City for $7 million at any time. If the developer elects to not purchase the land and conference center, the city will lease the land to the developer at a market based rate, including escalators. Alternatively, the City has a contractual commitment from the developer to begin paying back the loan starting in the 10th year from commencing operations of the facility over a term of 25 years. Management of the conference center has been contracted to a third party. In return, the City will pay the manager a monthly management fee as defined in the agreement. The initial infrastructure improvements were funded by the City up to $2 million with the developer paying the cost which exceeded the $2 million limit. An additional agreement was established which constructed a storm sewer through the property. Pursuant to the agreement the City would pay the expense of the storm sewer not to exceed $1 million. Additionally, the City previously purchased additional land along the corridor in a separate transaction for $2 million for the purpose of developing a sports complex. A ground lease agreement was entered into with a tenant, who will construct the facilities. The tenant agrees to pay the City monthly rentals of $5,000 for the land for thirty years. The tenant has the right to purchase the land for $2 million at any time. Alternatively, the City has the right to require the tenant to purchase the land for $2 million on the fifteenth anniversary date of its opening. Both projects have established timelines and benchmarks for completion that must be met by the various parties, subject to extension by the City and the various parties. These terms are not within the normal and customary practices of the City, and therefore other than normal credit risks are involved, the City will classify these agreements as operating leases and no additional provisions have been recorded in the accompanying financial statements because of these agreements. 4.F. SUBSEQUENT EVENTS In July 2016, the EPWA issued $41,795,000 of Sales Tax and Utility System Revenue Bonds. The bonds mature in principal amounts of $710,000 to $1,605,000 on July 1 of each year with final maturity on July 1, 2036. The bonds have an interest rate of 3.00% to 5.00%. Proceeds of the bonds will be used for water and wastewater improvements.

REQUIRED SUPPLEMENTARY INFORMATION

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

CITY OF EDMOND, OKLAHOMA BUDGETARY COMPARISON SCHEDULE GENERAL FUND For the fiscal year ended June 30, 2016

ORIGINAL BUDGET

FINAL BUDGET

VARIANCE WITH FINAL BUDGET POSITIVE (NEGATIVE)

ACTUAL

REVENUES TAXES: Sales tax

34,132,640

33,823,506

(309,134)

Use tax

3,633,865

4,363,029

729,164

Franchise

2,472,812

2,231,857

(240,955)

Hotel/Motel tax Liquor tax

Total Taxes

42,324

49,633

7,309

40,281,641

40,468,025

186,384

INTERGOVERNMENTAL: Grant revenues

292,523

Alcoholic beverage

131,417

117,601

(13,816)

Cigarette tax

744,085

759,077

14,992

Vehicle tax

620,690

645,760

25,070

Gasoline tax

154,286

167,629

13,343

1,650,478

1,982,590

332,112

Total Intergovernmental

CHARGES FOR SERVICES: Sw imming pool fees Recreational program fees Right-of-Way fees Cemetery fees Curb cut fees

60,347

67,428

(220)

4,962,817

155,590

153,126

(220) 7,081 (2,464)

9,710

10,200

490

Animal w elfare fees

51,830

53,290

1,460

Filing fees

59,608

81,481

21,873

911 fees

46,751

36,088

(10,663)

Transportation fees

5,801

25,166

19,365

5,352,454

5,389,376

36,922

FINES AND FORFEITURES

2,129,109

1,641,283

(487,826)

LICENSES AND PERMITS

1,461,706

1,412,552

(49,154)

70,000

63,954

(6,046)

224,850

233,744

8,894

51,170,238

51,191,524

21,286

1,081,526

13,765,341

1,081,526

13,765,341

Miscellaneous charges

Total Charges for Services

INVESTMENT INCOME

MISCELLANEOUS

TOTAL REVENUES

OTHER FINANCING SOURCES: Transfers from other funds Total Other Financing Sources TOTAL REVENUES AND OTHER FINANCING SOURCES

52,251,764

64,935,579

64,956,865

21,286 (Continued)

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

CITY OF EDMOND, OKLAHOMA BUDGETARY COMPARISON SCHEDULE GENERAL FUND For the fiscal year ended June 30, 2016

ORIGINAL BUDGET

FINAL BUDGET

VARIANCE WITH FINAL BUDGET POSITIVE

ACTUAL

EXPENDITURES General Governm ent: General: Other services and charges

64,000

Capital outlay

Total General

161,545

101,951

59,594

64,000

161,545

101,951

59,594

24,545

25,111

5,450

4,884

2,262

2,622

138,200

188,200

139,668

48,532

168,195

218,195

167,041

51,154

708,347

648,847

59,500

13,645

9,689

3,956

160,820

117,353

43,467

City Council: Personal services Materials and supplies Other services and charges Total City Council

Municipal Court: Personal services Materials and supplies Other services and charges Capital outlay

Total Judicial

882,812

775,889

106,923

100,000

166,017

133,887

32,130

Edmond-Guthrie Regional Airport Other services and charges

Cemetery: Personal services

138,027

143,267

Materials and supplies

12,175

9,182

2,993

Other services and charges

41,510

36,270

35,553

717

Capital outlay Total Cemetery

191,712

188,002

3,710

588,353

595,651

8,850

5,354

3,496

29,715

42,097

35,351

6,746

Planning and Zoning: Personal services Materials and supplies Other services and charges Capital outlay Total Planning and Zoning

626,918

646,598

636,356

10,242

84,414

75,164

9,250

5,481

4,453

1,028

45,525

57,025

43,584

13,441

Dow ntow n Community Center: Personal services Materials and supplies Other services and charges Capital outlay Dow ntow n Community Center TOTAL GENERAL GOVERNMENT

135,420

146,920

123,201

23,719

2,169,057

2,413,799

2,126,327

287,472

752,612

758,814

79,900

73,698

59,204

14,494

129,700

143,700

90,414

53,286

ECONOMIC DEVELOPMENT: Community Image: Personal services Materials and supplies Other services and charges Capital outlay

Total Community Image

962,212

976,212

908,432

TOTAL ECONOMIC DEVELOPMENT

962,212

976,212

908,432

67,780 67,780 (Continued)

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

CITY OF EDMOND, OKLAHOMA BUDGETARY COMPARISON SCHEDULE GENERAL FUND For the fiscal year ended June 30, 2016

ORIGINAL BUDGET

FINAL BUDGET

VARIANCE WITH FINAL BUDGET POSITIVE (NEGATIVE)

ACTUAL

PUBLIC SAFETY: Emergency Management: Personal services

209,323

212,195

212,194

Materials and supplies

16,717

13,845

8,025

5,820

Other services and charges

76,650

32,619

44,031

Capital outlay

50,000

352,690

252,838

99,852

Total Emergency Management

50,000

Building Department: Personal services

1,237,590

1,188,435

49,155

Materials and supplies

51,415

40,532

10,883

Other services and charges

97,801

52,726

45,075

Capital outlay

Total Building Department

1,386,806

1,281,693

105,113

TOTAL PUBLIC SAFETY

1,739,496

1,534,531

204,965

1,045,000

1,465,000

1,407,184

57,816

1,045,000

1,465,000

1,407,184

57,816

Other services and charges

616,500

617,276

617,275

TOTAL OUTSIDE AGENCIES

616,500

617,276

617,275

46,065

STREETS AND HIGHWAYS: Capital outlay TOTAL STREETS AND HIGHWAYS OUTSIDE AGENCIES:

PARKS AND RECREATION: Parks and Recreation: 1,083,052

1,083,052

1,036,987

Material and supplies

185,374

189,315

157,114

32,201

Other services and charges

933,285

998,235

884,502

113,733

Personal services

Capital outlay

Total Parks and Recreation

19,500

2,201,711

2,290,102

2,078,603

19,500 211,499

Senior Center: Personal services

329,479

329,495

329,494

Materials and supplies

21,045

21,029

14,097

6,932

Other services and charges

58,900

41,977

16,923

409,424

385,568

23,856

Personal services

6,459

3,995

2,464

Materials and supplies

1,370

862

508

Other services and charges

31,075

17,856

13,219

Total Festival Marketplace

38,904

22,713

16,191

Total Senior Citizens Festival Marketplace:

Historical Society: Materials and supplies

750

Other services and charges

263,250

276,301

276,300

Total Historical Society

264,000

277,051

276,300

751

2,914,039

3,015,481

2,763,184

252,297

9,446,304

10,227,264

9,356,933

870,331

Transfers to other funds

(44,287,510)

(59,324,875)

(59,309,114)

(15,761)

Total Other Financing Uses

(44,287,510)

(59,324,875)

(59,309,114)

(15,761)

53,733,814

69,552,139

68,666,047

886,092

TOTAL PARKS AND RECREATION TOTAL EXPENDITURES

750

OTHER FINANCING SOURCES (USES)

TOTAL EXPENDITURES AND OTHER FINANCING USES REVENUES AND OTHER SOURCES OVER (UNDER) EXPENDITURES AND OTHER USES

(1,482,050)

(4,616,560)

(3,709,182)

907,378

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Budgetary Comparison Schedule Major Special Revenue Fund - Fire Public Safety Limited Tax Fund For the year ended June 30, 2016

Fire Public Safety Limited Tax Fund

Original Budget REVENUES Taxes Intergovernmental Charges for services Investment income Miscellaneous Total revenues

4,259,494 6,000 65,000 39,124 4,369,618

Final Budget

4,259,494 6,000 6,500 39,124 4,311,118

Actual

4,227,938 67,136 12,042 98,539 59,093 4,464,748

Variance with Final Budget Positive (Negative)

(31,556) 67,136 6,042 92,039 19,969 153,630

EXPENDITURES Current: Public Safety Personal services Materials and supplies Other services and charges Capital outlay Total Expenditures Excess (deficiency) of revenues over expenditures

14,697,721 1,208,250 3,546,543 1,054,000 20,506,514

14,697,721 1,213,036 3,667,221 1,196,660 20,774,638

14,535,787 643,630 3,275,460 587,226 19,042,103

161,934 569,406 391,761 609,434 1,732,535

(16,136,896)

(16,463,520)

(14,577,355)

1,886,165

OTHER FINANCING SOURCES (USES) Transfers in Total other financing sources and uses

14,998,728 14,998,728

15,207,484 15,207,484

Net change in fund balance

(1,138,168)

(1,464,792)

630,129

(208,756) (208,756) $

2,094,921

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Budgetary Comparison Schedule Major Special Revenue Fund -Police Public Safety Limited Tax Fund For the year ended June 30, 2016

Police Public Safety Limited Tax Fund

Original Budget REVENUES Taxes Intergovernmental Charges for services Investment income Miscellaneous Total revenues

2,141,944 150,000 3,000 35,000 25,000 2,354,944

Final Budget

2,141,944 213,000 3,000 35,000 25,000 2,417,944

Actual

2,113,969 183,583 69,311 340,558 2,707,421

Variance with Final Budget Positive (Negative)

(27,975) (29,417) (3,000) 34,311 315,558 289,477

EXPENDITURES Current: Public Safety Personal services Materials and supplies Other services and charges Capital outlay Total Expenditures Excess (deficiency) of revenues over expenditures

16,411,237 1,050,832 4,403,924 32,000 21,897,993

16,563,128 960,598 4,418,484 175,068 22,117,278

16,563,126 696,684 4,133,923 170,528 21,564,261

2 263,914 284,561 4,540 553,017

(19,543,049)

(19,699,334)

(18,856,840)

842,494

OTHER FINANCING SOURCES (USES) Transfers in Total other financing sources and uses

18,398,440 18,398,440

18,654,514 18,654,514

256,074 256,074

Net change in fund balances

(1,144,609)

(1,300,894)

(202,326)

1,098,568

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

NOTES TO BUDGETARY COMPARISON SCHEDULES BUDGETARY ACCOUNTING AND CONTROL Budget Law The City prepares its annual operating budget under the provisions of the Oklahoma Municipal Budget Act of 1979 (the "Budget Act"). In accordance with those provisions, the following process is used to adopt the annual budget: a.

Prior to June 1, the City Manager submits to the City Council a proposed operating budget for the fiscal year commencing the following July 1. The operating budget includes proposed expenditures and the means of financing them.

Public hearings are conducted to obtain taxpayer comments. Public hearings are held no later than 15 days prior to the beginning of the budget year.

Subsequent to the public hearings but no later than seven days prior to July 1, the budget is legally enacted through the passage of a resolution by the City Council.

Subsequent to City Council enactment, the adopted budget is filed with the office of the State Auditor and Inspector.

The legal level of control at which expenditures may not legally exceed appropriations is the department level within a fund. The City Manager may only transfer appropriations within expenditure categories within a department without City council approval. Transfers between expenditure categories of a department or fund and budget supplements made during the year are recommended by the City Manager and must be approved by the City Council. Supplemental appropriations must also be filed with the Office of State Auditor and Inspector. Budgetary Accounting The City prepares its budgets for all governmental fund types on a budgetary basis of accounting which differs from the modified accrual basis of accounting in the following areas: Grants that do not result in cash flow and the related expenditures are not budgeted. Internal service fund charges for services are recorded as transfers in the budgetary basis.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

The following is a reconciliation of those differences: City of Edmond, Oklahoma Notes to Budgetary Comparison Schedule Reconciliation of Budgetary Basis to Modified Accrual Basis For the year ended June 30, 2016

General Fund: Total Revenues Transfers In Total Revenues and Other Financing Sources

Per Statement of Revenues, Expenditures, and Changes in Fund Balance

Internal Service Fund Transfers

Non-Cash Grant Activity

Fund Combined for Reporting Purposes

Per Budgetary Comparison Schedule

Total Expenditures Transfers Out Total Expenditures and Other Financing Uses Net Changes in Fund Balance

Fire Public Safety Limited Tax Fund: Total Revenues Transfers In Total Revenues and Other Financing Sources Total Expenditures Total Expenditures and Other Financing Uses Net Changes in Fund Balance

Police Public Safety Limited Tax Fund: Total Revenues Transfers In Total Revenues and Other Financing Sources Total Expenditures Total Expenditures and Other Financing Uses Net Changes in Fund Balance

51,218,416 13,765,341 64,983,757 20,224,809 48,583,099 68,807,908

(10,726,015) 10,726,015 -

(26,892) (26,892) (141,861) (141,861)

51,191,524 13,765,341 64,956,865 9,356,933 59,309,114 68,666,047

(3,824,151)

114,969

(3,709,182)

8,097,246 15,207,484 23,304,730

(3,632,498) (3,632,498)

4,464,748 15,207,484 19,672,232

22,674,601 22,674,601 630,129

3,917,080 18,654,514 22,571,594 22,773,920 22,773,920 (202,326)

(3,632,498) (3,632,498) -

(1,209,659) (1,209,659) (1,209,659) (1,209,659) -

19,042,103 19,042,103 630,129

2,707,421 18,654,514 21,361,935 21,564,261 21,564,261 (202,326)

All governmental funds of the city are required to have annual budgets. The City prepared and adopted a legal annual budget for all governmental funds except the Roadway Improvement Fund and the 1996 CIP Tax Fund. The City utilized encumbrances accounting under which purchase orders, contracts and other commitments for the expenditure funds are recorded in order to reserve a portion of the applicable appropriation. Encumbered appropriations at year end are lapsed and encumbrances to be honored are re-appropriated in the following budget year.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Schedules of Required Supplementary Information SCHEDULE OF THE CITY OF EDMOND'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY OKLAHOMA POLICE PENSION & RETIREMENT SYSTEM Last 10 Fiscal Years* For the year June 30, 2015

2016

City's proportion of the net pension liability

3.0197%

3.1355%

City's proportionate share of the net pension liability (asset)

$ (1,016,693)

City's covered-employee payroll

$ 8,445,211

$ 8,831,635

City's proportionate share of the net pension liability (asset) as a percentage of its covered-employee payroll

(12.04%)

1.45%

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

101.53%

99.82%

127,846

Notes to Schedule: Only two fiscal years are presented because 10-year data is not yet available.

SCHEDULE OF CITY CONTRIBUTIONS OKLAHOMA POLICE PENSION & RETIREMENT SYSTEM Last 10 Fiscal Years *

2015 Statutorily required contribution

Contributions in relation to the statutorily required contribution Contribution deficiency (excess)

City's covered-employee payroll

2016

1,152,006

$ 1,305,813

1,152,006

1,305,813

8,831,635

$ 9,974,924

13%

Contributions as a percentage of covered-employee payroll

Notes to Schedule: Only two fiscal years are presented because 10-year data is not yet available.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Schedules of Required Supplementary Information SCHEDULE OF THE CITY OF EDMOND'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY OKLAHOMA FIREFIGHTERS PENSION & RETIREMENT SYSTEM Last 10 Fiscal Years* For the year June 30,

City's proportion of the net pension liability

2015

2016

3.5619241%

3.566186%

City's proportionate share of the net pension liability

36,628,970

City's covered-employee payroll

9,729,108

$ 37,851,799 $

9,743,764

City's proportionate share of the net pension liability as a percentage of its covered-employee payroll

376.49%

388.47%

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

68.12%

68.27%

Notes to Schedule: Only two fiscal years are presented because 10-year data is not yet available.

SCHEDULE OF CITY CONTRIBUTIONS OKLAHOMA FIREFIGHTERS PENSION & RETIREMENT SYSTEM Last 10 Fiscal Years

2015

2016

Statutorily required contribution

$ 1,364,114

$ 1,474,042

Contributions in relation to the statutorily required contribution

1,364,114

1,474,042

Contribution deficiency (excess)

City's covered-employee payroll

$ 9,743,764

$ 10,528,981

14%

Contributions as a percentage of covered-employee payroll

Notes to Schedule: Only two fiscal years are presented because 10-year data is not yet available.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

SCHEDULE OF CHANGES IN THE CITY'S NET PENSION LIABILITY AND RELATED RATIOS SINGLE-EMPLOYER DEFINED BENEFIT PENSION PLAN Last 10 Fiscal Years* For the year June 30. 2015 Total pension liability Service cost Interest Changes of benefit terms Difference between expected and actual experience Benefit payments, including refunds of member contributions Net change in total pension liability Total pension liability-beginning Total pension liability-ending (a)

2016

2,465,096 4,803,663 1,229,173 700,579 (2,164,180) 7,034,331 64,855,477 71,889,808

$ 2,619,414 5,193,616 584,011 (3,135,897) 5,261,144 71,889,808 $ 77,150,952

$ 2,108,839 1,338,561 (2,627,009) (3,135,897) (30,748) (2,346,254) 66,089,862 $ 63,743,608

Plan fiduciary net position Contributions-employer Contributions-member Net investment income Benefit payments, including refunds of member contributions Administrative expense Net change in plan fiduciary net position Plan fiduciary net position-beginning Plan fiduciary net position-ending (b)

1,965,953 1,264,678 8,331,083 (2,164,180) (38,377) 9,359,157 56,730,705 66,089,862

City's net pension liability - ending (a)-(b)

5,799,946

$ 13,407,344

91.93%

82.62%

23,801,107

$ 25,382,314

24.37%

52.82%

Plan fiduciary net position as a percentage of the total pension liability Covered-employee payroll

City's net pension liability as a percentage of covered employee payroll

Notes to Schedule: Only two fiscal years are presented because 10-year data is not yet available.

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

SCHEDULE OF EMPLOYER CONTRIBUTIONS SINGLE-EMPLOYER DEFINED BENEFIT PENSION PLAN Last 10 Fiscal Years For the year June 30. 2012 Actuarially determined contribution Contributions in relation to the actuarially determined contribution Contribution deficiency (excess)

Covered-employee payroll

1,803,629 1,886,892 (83,263)

22,630,229

Contributions as a percentage of covered-employee payroll

2013 $

2014 $

1,846,314 1,822,720 23,594

22,598,708

7.97%

2015 $

2,004,213 1,965,953 38,260

24,089,104

8.17%

2016 $

2,195,239 2,108,839 86,400

2,397,984 2,292,339 105,645

25,496,393

26,673,905

8.32%

8.61%

8.99%

Notes to Schedule: Valuation date: Actuarially determined contribution rates are calculated as of June 30, one year prior to the end of the fiscal year in which contributions are reported. Methods and assumptions used to determine contribution rates: Actuarial cost method

Entry Age Normal

Amortization method

Level dollar, rolling

Remaining amortization period

30 years rolling

Asset valuation method

5-year smoothed market (20% annual write up of cumulative gain or loss relative to assumed return)

Inflation

2.5%

Salary Increases

5.0% average including inflation plus age-scale

Investment rate of return

7.25%, net of pension plan investment expense, including inflation

Retirement age

Plan experience as last measured in 2011

Mortality

In the 2016 actuarial valuation, assumed life expectancies utilized the RP-2000 Projected Mortality Table. (Continued)

SCHEDULE OF EMPLOYER CONTRIBUTIONS (Continued) SINGLE-EMPLOYER DEFINED BENEFIT PENSION PLAN Last 10 Fiscal Years For the year June 30. 2007 Actuarially determined contribution Contributions in relation to the actuarially determined contribution Contribution deficiency (excess)

Covered-employee payroll

Contributions as a percentage of covered-employee payroll

1,326,747 1,379,744 (52,997)

18,476,444 7.18%

100

2008 $ $

1,135,240 1,407,776 (272,536)

19,730,579 5.75%

2009 $ $

1,334,008 1,271,783 62,225

21,223,530 6.29%

2010 $

2011

1,879,700 1,866,908 12,792

22,521,201

8.35%

1,803,185 1,811,247 (8,062)

21,588,603 8.35%

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

PENSION FUND - SCHEDULE OF INVESTMENT RETURNS Last 10 Fiscal Years *

Annual money-weighted rate of return, net of investment expense

Year Ended June 30. 2014

Year Ended June 30. 2015

14.55%

-3.97%

Notes to Schedule: Only two fiscal years are presented because 10-year data is not yet available.

101

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Schedules of Required Supplementary Information OPEB ACTUARIAL VALUATION FUNDING SCHEDULES June 30, 2016 The funded status and funding progress of the City's defined benefit OPEB plan for the most recent actuarial valuations is as follows:

July 1, 2010

July 1, 2011

July 1, 2012

July 1, 2013

July 1, 2014

July 1, 2015

Actuarial accrued liability - AAL (a) Actuarial value of plan assets (b) Unfunded actuarial accrued liability-UAAL (funding excess) (a)-(b)

3,770,440 -

$ 4,239,856 -

$ 4,837,346 -

$ 4,854,278 -

$ 4,929,613 -

$ 5,344,565 -

3,770,440

4,239,856

4,837,346

4,854,278

4,929,613

5,344,565

Funded ratio (b)/(a) Covered payroll Â©

0% $ 33,132,000

0% $ 31,860,000

0% $ 31,783,016

0% $ 32,710,000

0% $ 36,200,000

0% $ 37,500,000

11%

13%

15%

14%

UAAL (funding excess) as a % of covered payroll [UAAL/( c)]

102

OTHER SUPPLEMENTARY INFORMATION

103

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

GENERAL FUND Under GASB Statement 54 certain funds no longer met the definition to be presented as Special Revenue Funds. Those funds became accounts of the General Fund for reporting purpose. For reporting purposes, the General Fund contains the following subfund accounts: GENERAL FUND - The primary operating fund of the City. The General Fund is reported as a major governmental fund. It is used to account for all activities except those legally or administratively required to be accounted for in other funds. REAL PROPERTY FUND - The Real Property Fund has been established to accumulate resources for future real property acquisitions of the City. Financing is provided by transfers of investment earnings from the Hospital Sale Trust Fund. EDMOND ELECTRIC ECONOMIC DEVELOPMENT FUND – The Economic Development Fund has been established to stimulate the growth of Edmond's economy by offering services that facilitate the growth and expansion of new and existing businesses and generating opportunities to increase the sales tax base of the City of Edmond. PARK SPECIAL EVENTS – The Park Special Events Fund has been established to account for donations and fees related to culture and recreation events.

104

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Balance Sheet General Fund Accounts June 30, 2016

ASSETS Cash and cash equivalents Investments Due from other funds Due from other governments Accrued interest receivable Other receivables Total assets

LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Due to other funds Deferred revenue Amounts held in escrow Total liabilities DEFERRED INFLOWS OF RESOURCES Unavailable revenue Total deferred inflows of resources Fund balances: Restricted Assigned Unassigned Total fund balances Total liabilities, deferred inflows of resources and fund balances

110,546 1,126,379 85,708 5,684,907 2,472 1,132,882 8,142,894

Edmond Electric Economic Development

Real Property Fund

General Fund $

15,616 139,103 305 155,024

80,628 718,253 1,576 800,457

Park Special Events $

Total General Fund

4,244 37,804 83 42,131

211,034 2,021,539 85,708 5,684,907 4,436 1,132,882 9,140,506

774,098 18,112 197,070 519,166 1,508,446

477,898 477,898

182 182

940 940

50 50

479,070 479,070

2,889,481 124,430 3,142,639 6,156,550 8,142,894

154,842 154,842 155,024

799,517 799,517 800,457

42,081 42,081 42,131

2,889,481 1,120,870 3,142,639 7,152,990 9,140,506

105

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Statement of Revenues, Expenditures and Changes in Fund Balances General Fund Accounts For the Year Ended June 30, 2016

Real Property Fund

General Fund REVENUES Sales and use taxes Franchise and public service taxes Intergovernmental Charges for services Fines and forfeitures Licenses and permits Investment income Miscellaneous Total revenues

EXPENDITURES Current: General government Public safety Health and sanitation Culture, parks and recreation Economic development Streets and highways Capital Outlay Total Expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending

38,186,535 2,281,490 1,982,590 5,389,376 1,641,283 1,412,552 63,954 233,744 51,191,524

5,110,872 2,988,821 647,276 3,609,176 576,728 6,354,224 937,712 20,224,809

25 25

30,966,715

1,289

13,765,341 (48,583,099) (34,817,758) (3,851,043)

1,289

10,007,593 $

1,314 1,314

6,156,550

Edmond Electric Economic Development

Park Special Events

Total General Fund

141,140 141,140

153,553 $

154,842

106

7,736 7,736

8,104 127 9,611 17,842

38,186,535 2,281,490 1,982,590 5,397,480 1,641,283 1,412,552 73,131 243,355 51,218,416

696 696

5,252,037 2,988,821 647,276 3,609,872 576,728 6,354,224 937,712 20,366,670

(133,404)

17,146

30,851,746

(133,404)

17,146

13,765,341 (48,583,099) (34,817,758) (3,966,012)

932,921

24,935

11,119,002

799,517

42,081

7,152,990

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Schedule of Revenues, Expenditures and Changes in Fund Balance-Budgetary Basis Budget and Actual - General Funds Combined For the year ended June 30, 2016

EDMOND ELECTRIC ECONOMIC DEVELOPMENT

Budget

PARKS SPECIAL EVENTS FUND

Variance Positive (Negative)

Actual

Budget

Variance Positive (Negative)

Actual

Revenues: Charges for services

500

8,104

7,604

Investment income

7,736

127

Miscellaneous

5,000

9,611

4,611

Total Revenues

7,736

5,500

17,842

12,342

Expenditures: General Government: Personal services

Materials and supplies Other services and charges

141,141

141,140

Capital outlay

Debt service

Total General Government

141,141

141,140

Other service and charges

Capital outlay

Parks and Recreation: Personal services Materials and supplies

Total Parks and Recreation

Total Expenditures

696

1,804

15,000

17,500

696

16,804

141,141

141,140

17,500

696

16,804

Revenues and other sources over (under) expenditures and other uses

(141,141)

(133,404)

932,921

Fund Balance-beginning of year Fund Balance -end of year

2,500

791,780

7,737

932,921 $

799,517

107

(12,000)

7,737

17,146

24,935 $

12,935

29,146

24,935 $

42,081

29,146

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Schedule of Revenues, Expenditures and Changes in Fund Balance-Budgetary Basis Budget and Actual - General funds Combined For the year ended June 30, 2016 (Continued)

REAL PROPERTY FUND

Budget

Variance Positive (Negative)

Actual

Revenues: Charges for services

Investment income Miscellaneous Total Revenues

1,000

1,313

313

1,000

1,313

313

Expenditures: General Government: Personal services Materials and supplies Other services and charges

Capital outlay

154,163

Debt service

Total General Government

154,238

154,213

Other service and charges

Capital outlay

Parks and Recreation: Personal services Materials and supplies

Total Parks and Recreation

Total Expenditures

154,238

154,213

Revenues and other sources over (under) expenditures and other uses

(153,238) 153,553

Fund Balance-beginning of year Fund Balance -end of year

108

315

1,288

154,526

153,553

154,841

154,526

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

NONMAJOR GOVERNMENTAL FUNDS Special Revenue Funds Special Revenue Funds are used to account for the proceeds of specific revenue sources that are normally restricted to expenditures for specified purposes. CDBG ENTITLEMENT - This fund was established by the City to account for the grants received from the Federal government through the Oklahoma Department of Commerce under various Community Development Block Grant programs. ASSET FORFEITURE FUND - The Asset Forfeiture Fund has been established to account for assets that are equitably distributed by the Drug Enforcement Administration to state and local agencies that directly participate in the law enforcement effort that leads to the seizure of assets used in illegal drug activities. The assets received must be for only law enforcement purposes such as enhancements to future investigations, law enforcement training, equipment, operations and overtime for enforcement activities. SENIOR CITIZENS FUND - This fund was established to account for dedicated revenues received for the benefit of senior citizens, including grants, donations and other resources. The expenditures of the fund are administratively restricted for the benefit of senior citizens' activities or programs. CONVENTION & VISITORS BUREAU – The Convention & Visitors Bureau Fund accounts for the Hotel/Motel tax revenues that the City collects. It is restricted for tourism, conventions, and visitors’ bureau. HOSPITAL SALE TRUST FUND –The Hospital Sale Trust Fund was established in 1981 to account for the proceeds of approximately $7,200,000 received from the sale of the Edmond Memorial Hospital to the Hospital Corporation of America. Use of the trust principal must first be approved by a vote of the citizens of the City. Investment earnings from the trust may be appropriated without voter approval but are restricted to capital improvements. AMBULATORY SERVICE FUND – The Ambulatory Service Fund provides funding of the City of Edmond’s Ambulance Services through the regional Emergency Medical Services Authority (EMSA). It primarily covers those citizens who have elected to participate in the TotalCare Program which is a monthly fee of $3.00 paid through utility billing which began in FY 09-10. (continued)

109

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Capital Project Funds The Capital Project Funds have been established to account for all major capital improvements, except those accounted for in proprietary type funds, which are financed by the City's sales tax revenue bond issues, General Fund transfers, and other designated sources. CEMETERY CARE FUND - The Cemetery Care Fund has been established to account for 12.5% of all monies received from the sale of lots and interments in accordance with state law. Monies received must be used to purchase lands for cemeteries and for making capital improvements. Interest earned may be used for improving, caring for, and embellishing cemetery property. PARK SALES TAX FUND - The Park Sales Tax Fund has been established to account for operations and facility improvement costs of the Cityâ&#x20AC;&#x2122;s park and recreation system. Financing is provided by a permanent one-eighth cent sales tax approved by the voters in September 1992 and expanded in 2000 to include all city parks. ART IN PUBLIC PLACES FUND â&#x20AC;&#x201C; The Art in Public Places Fund has been established to account for art acquisitions by the City. Financing is provided by donations, investment earnings and other City funds as determined by the City Council. CAPITAL IMPROVEMENT FUND - The Capital Improvement Fund was established to account for major capital improvements that are financed by the General Fund and other designated sources which are outlined in the City's five year Capital Improvements program. The fund is funded primarily from General Fund transfers. ROADWAY IMPROVEMENT FUND - The Roadway Improvement Fund has been established to account for street construction and improvement projects as approved by the voters on May 10, 1994. The improvements are financed by a temporary seven-eighths cent sales tax which ended in FY1995. The remainder of funds are planned to be expended on street improvements. 1996 CAPITAL IMPROVEMENT TAX FUND - The 1996 Capital Improvements Tax Fund has been established to account for various capital improvements as recommended by the Citizens Capital Improvements Planning Committee and approved by the voters on August 27, 1996. The improvements are being financed by a three-fourths cent sales tax for a five year period beginning November 1, 1996. Funded from the tax are street improvements, radio communication system and computer aided dispatch, water treatment plant expansion, library expansion, senior citizens center, and a city wide sidewalk project.

110

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Balance Sheet Nonmajor Governmental Funds June 30, 2016

SPECIAL REVENUE FUNDS CDBG Entitlement Fund ASSETS Cash and cash equivalents Investments Due from other governments Accrued interest receivable Other receivable Interfund loan receivable Total assets

LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Due to other funds Total liabilities DEFERRED INFLOWS OF RESOURCES Unavailable revenue Total deferred inflows of resources

87,198 87,198

26,716 237,993 522 265,231

Convention and Visitor's Bureau Fund $

10,229 91,118 200 47,425 148,972

7,134 7,134

26,286 26,286

734 734

311 311

120 120

592,818 31,383 624,201

238,743 8,902 10,141 257,786

104,165 18,401 122,566

(903) (903) $

62,948 560,757 1,230 624,935

Senior Center Fund

3,393 84,708 88,101

Fund balances: Restricted Committed Assigned Unassigned Total fund balances Total liabilities, deferred inflows of resources and fund balances

Asset Forfeiture Fund

87,198

624,935

111

265,231

148,972

Hospital Sale Trust Fund $

Ambulatory Service Fund

1,316,571 3,303 6,881,060 8,200,934

1,000 1,000

2,248 2,248

630 630

8,199,934 8,199,934

556,818 11,821 568,639

54,046 481,443 1,056 34,972 571,517

8,200,934

571,517 (Continued)

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Balance Sheet Nonmajor Governmental Funds June 30, 2016

CAPITAL PROJECT FUNDS

ASSETS Cash and cash equivalents Investments Due from other governments Accrued interest receivable Other receivable Interfund loan receivable Total assets

Cemetery Care

Park Sales Tax Fund

LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Due to other funds Total liabilities DEFERRED INFLOWS OF RESOURCES Unavailable revenue Total deferred inflows of resources

Fund balances: Restricted Committed Assigned Unassigned Total fund balances Total liabilities, deferred inflows of resources and fund balances

9,971 88,826 195 98,992

210,474 1,874,941 305,739 4,115 77,048 2,472,317

Art in Public Places Fund $

26,268 53,908 119 (72) 80,223

Capital Improvement Fund $

123,591 1,100,969 2,416 75,000 1,301,976

Roadway Improvement Fund $

Total Governmental Funds

1996 CIP Tax Fund

1,111 9,896 22 11,029

18,803 167,503 368 186,674

1,860,728 4,667,354 392,937 10,243 237,676 6,881,060 14,049,998

266,074 266,074

6,844 5 6,849

103,672 103,672

413,403 87,961 501,364

116 116

2,455 2,455

71 71

1,442 1,442

13 13

219 219

6,111 6,111

94,620 4,256 98,876

1,964,251 239,537 2,203,788

66,014 7,289 73,303

1,196,862 1,196,862

10,199 817 11,016

141,718 44,737 186,455

98,992

2,472,317

112

80,223

1,301,976

11,029

186,674

11,969,280 8,902 1,565,244 (903) 13,542,523 $

14,049,998

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended June 30, 2016

SPECIAL REVENUE FUNDS CDBG Entitlement Fund REVENUES Sales and use taxes Hotel/motel taxes Intergovernmental Charges for services Investment earnings Investment earnings on interfund loans Miscellaneous Total revenues

EXPENDITURES Current: General government Public Safety Health and welfare Culture, parks and recreation Capital Outlay Total Expenditures Excess (deficiency) of revenues over expenditures

375,377 1 375,378

94,183 282,473 376,656 (1,278)

OTHER FINANCING SOURCES (USES) Transfers in Transfers out

Total other financing sources and uses Net change in fund balances

(1,278)

Fund balances - beginning Fund balances - ending

Asset Forfeiture Fund

375 $

(903)

4,810 110,810 115,620

1,598 2,322 54,587 58,507

464,362 680 22,355 487,397

Hospital Sale Trust Fund $

Ambulatory Service Fund

361 85,876 86,237

869,997 3,702 4 873,703

31,756 31,756

55,808 55,808

474,553 474,553

2,200 2,200

737,401 737,401

83,864

2,699

12,844

84,037

136,302

83,864

2,699

12,844

84,037

136,302

540,337 $

Convention and Visitor's Bureau Fund

Senior Center Fund

624,201

113

255,087 $

257,786

109,722 $

122,566

8,115,897 $

8,199,934

432,337 $

568,639 (Continued)

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended June 30, 2016

CAPITAL PROJECT FUNDS

REVENUES Sales and use taxes Hotel/motel taxes Intergovernmental Charges for services Investment earnings Investment earnings on interfund loans Miscellaneous Total revenues

Cemetery Care

Park Sales Tax Fund

EXPENDITURES Current: General government Public Safety Health and welfare Culture, parks and recreation Capital Outlay Total Expenditures Excess (deficiency) of revenues over expenditures

6,024 77,634 83,658

Total other financing sources and uses Net change in fund balances

(52,136)

Fund balances - beginning

151,012 $

98,876

2,113,969 14,226 77,049 2,205,244

4,466 9,775 14,241

994,184 339,120 1,333,304

(52,136)

OTHER FINANCING SOURCES (USES) Transfers in Transfers out

Fund balances - ending

30,162 1,360 31,522

Art in Public Places Fund

11,139 75,000 86,139

Roadway Improvement Fund $

Total-Other Governmental Funds

1996 CIP Tax Fund

94 94

1,640 1,640

2,113,969 464,362 375,377 901,758 44,800 85,876 349,580 4,335,722

36,268 165,690 201,958

204 482,942 483,146

2 2

30 30

577,196 31,756 737,401 1,086,260 1,347,859 3,780,472

871,940

(187,717)

(397,007)

1,610

555,250

(60,129)

35,217 -

311,000 -

(60,129) 811,811

35,217 (152,500)

311,000 (86,007)

1,610

1,391,977 $

Capital Improvement Fund

2,203,788

225,803 $

73,303

114

1,282,869 $

1,196,862

10,924 $

11,016

346,217 (60,129) 286,088 841,338

184,845 $

186,455

12,701,185 $

13,542,523

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

CITY OF EDMOND, OKLAHOMA SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE-BUDGETARY BASIS BUDGET AND ACTUAL - NONMAJOR GOVERNEMNTAL FUNDS For the fiscal year ended June 30, 2016 SPECIAL REVENUE FUNDS CDBG ENTITLEMENT

Budget

ASSET FORFEITURE FUND Variance Positive (Negative)

Actual

Budget

Variance Positive (Negative)

Actual

Revenues: Taxes

Intergovernmental Charges for services

477,407

375,377

(102,030) 1

Investment income

2,000

4,810

2,810

Miscellaneous

25,000

110,810

85,810

477,407

375,378

27,000

115,620

88,620

Total Revenues

(102,029)

General Government: Personal services

Materials and supplies

Other services and charges

Capital outlay

Debt service

Total General Government Public Safety:

Materials and supplies

37,000

31,665

5,335

Other services and charges

Personal services

7,700

7,609

Capital outlay

19,000

63,700

31,756

31,944

Total Public Safety

Parks and Recreation: Personal services

Material and supplies

Other services and charges

Capital outlay Total Parks and Recreation

Health & Welfare: Personal services

Materials and supplies

Other services and charges

Capital outlay

66,499

49,764

16,735

850

510

340

443,860

326,382

117,478

511,209

376,656

134,553

Total Health & Welfare Economic Development & Opp. Personal services Materials and supplies Other services and charges Capital outlay Total Economic Development & Opp Street: Personal services

Materials and supplies

Other services and charges

Capital outlay

Total Street

511,209

Total Expenditures Revenues over (under) expenditures

(33,802)

376,656 $

(1,278)

134,553 $

32,524

63,700 $

(36,700)

31,756 $

83,864

31,944 $

120,564

Other financing sources (uses): Transfers from other funds

Transfers to other funds

(36,700)

83,864

120,564

540,337

Revenues and other sources over (under) expenditures and other uses

(33,802)

Fund Balance -end of year

(1,278)

375

Fund Balance-beginning of year $

(33,427)

32,524

375 $

(903)

32,524

503,637

624,201

120,564 (continued)

115

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Budget

CONVENTION AND VISITOR'S BUREAU FUND Variance Positive (Negative)

Actual

Budget

Variance Positive (Negative)

Actual

Revenues: Taxes

Intergovernmental

Charges for services

2,981

1,598

Investment income

1,500

2,322

58,616

54,587

(4,029) (4,590)

Miscellaneous

822

63,097

58,507

Personal services

Total Revenues

(1,383)

476,000

464,362

(11,638)

500

680

180

18,000

22,355

4,355

494,500

487,397

(7,103)

224,928

212,080

12,848

General Government: Materials and supplies

13,525

5,578

7,947

Other services and charges

268,605

256,895

11,710

Capital outlay

Debt service

507,058

474,553

32,505

Personal services

Materials and supplies

Total General Government Public Safety:

Other services and charges

Capital outlay

Total Public Safety Parks and Recreation: Personal services

8,150

7,958

192

56,950

47,850

9,100

65,100

55,808

9,292

Personal services

Materials and supplies

Other services and charges

Capital outlay

Material and supplies Other services and charges Capital outlay Total Parks and Recreation Health & Welfare:

Total Health & Welfare Economic Development & Opp. Personal services Materials and supplies

Other services and charges

Capital outlay

Total Economic Development & Opp Street: Personal services Materials and supplies

Other services and charges

Capital outlay

Total Street Total Expenditures Revenues over (under) expenditures

65,100

55,808

9,292

507,058

474,553

32,505

(2,003)

2,699

4,702

(12,558)

12,844

25,402

Other financing sources (uses): Transfers from other funds

Transfers to other funds

2,699

4,702

(12,558)

12,844

25,402

255,087

109,722

Revenues and other sources over (under) expenditures and other uses

(2,003) 255,087

Fund Balance-beginning of year Fund Balance -end of year

253,084

257,786

4,702

97,164

122,566

25,402 (continued)

116

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Budget

AMBULATORY SERVICE FUND Variance Positive (Negative)

Actual

Budget

Variance Positive (Negative)

Actual

Revenues: Taxes

Intergovernmental

Charges for services Investment income Miscellaneous Total Revenues

900,000

869,997

77,000

86,237

9,237

1,200

3,702

77,000

86,237

9,237

901,200

873,703

(30,003) 2,502 4 (27,497)

General Government: Personal services

Materials and supplies Other services and charges

2,200

Capital outlay

Debt service

2,200

Total General Government Public Safety: Personal services

Materials and supplies

Other services and charges

Capital outlay

Total Public Safety Parks and Recreation:

Material and supplies

Other services and charges

Personal services

Capital outlay

Total Parks and Recreation Health & Welfare: Personal services

Materials and supplies

10,000

8,879

1,121

Other services and charges

811,530

728,522

83,008

Capital outlay

821,530

737,401

84,129

Total Health & Welfare Economic Development & Opp. Personal services

Materials and supplies

Other services and charges

Capital outlay

Total Economic Development & Opp Street: Personal services

Materials and supplies

Other services and charges

Capital outlay

Total Street Total Expenditures Revenues over (under) expenditures

Other financing sources (uses): Transfers from other funds Transfers to other funds Revenues and other sources over (under) expenditures and other uses

2,200

821,530

737,401

84,129

74,800

84,037

9,237

79,670

136,302

56,632

74,800

84,037

9,237

79,670

136,302

56,632

8,115,897

Fund Balance-beginning of year Fund Balance -end of year

2,200

8,190,697

8,115,897 $

8,199,934

9,237

432,337 $

512,007

432,337 $

568,639

56,632 (continued)

117

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Budget

PARK SALES TAX FUNDS Variance Positive (Negative)

Actual

Budget

Variance Positive (Negative)

Actual

Revenues: Taxes

Intergovernmental Charges for services Investment income Miscellaneous Total Revenues

2,141,944

2,113,969

(27,975)

19,449

30,162

10,713

600

1,360

760

10,000

14,226

4,226

56,000

77,049

21,049

20,049

31,522

11,473

2,207,944

2,205,244

(2,700)

General Government: Personal services

Capital outlay

133,000

83,634

49,366

Debt service

133,075

83,658

49,417

Personal services

Materials and supplies

Other services and charges

Capital outlay

363,775

356,709

Materials and supplies Other services and charges

Total General Government

Public Safety:

Total Public Safety Parks and Recreation: Personal services

Material and supplies

Other services and charges

Capital outlay

Personal services Materials and supplies Other services and charges Capital outlay

7,066

50,720

45,791

4,929

702,094

591,684

110,410

1,705,795

339,120

1,366,675

2,822,384

1,333,304

1,489,080

Personal services

Materials and supplies

Other services and charges

Capital outlay

Personal services

Materials and supplies

Other services and charges

Capital outlay

Total Parks and Recreation Health & Welfare:

Total Health & Welfare Economic Development & Opp.

Total Economic Development & Opp Street:

Total Street Total Expenditures Revenues over (under) expenditures

133,075

83,658

49,417

2,822,384

1,333,304

1,489,080

(113,026)

(52,136)

60,890

(614,440)

871,940

1,486,380

Other financing sources (uses): Transfers from other funds

Transfers to other funds

Revenues and other sources over (under) expenditures and other uses Fund Balance-beginning of year Fund Balance -end of year

(113,026)

(52,136)

151,012

37,986

98,876

60,890

669,058

48,350

811,811

1,391,977 $

(60,129)

(722,919)

(108,479)

1,534,730

1,391,977 $

2,203,788

1,534,730 (continued)

118

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Budget

CAPITAL IMPROVEMENT FUND Variance Positive (Negative)

Actual

Budget

Variance Positive (Negative)

Actual

Revenues: Taxes

Intergovernmental

Charges for services

Investment income Miscellaneous

350

4,465

4,115

2,500

11,139

8,639

103,000

9,775

(93,225)

75,000

(89,110)

77,500

86,139

8,639

103,350

14,240

Personal services

Materials and supplies

Other services and charges

150

204

Capital outlay

593,931

293,124

Debt service

594,081

293,328

300,753

Total Revenues General Government:

Total General Government

(54) 300,807

Public Safety: Personal services

Materials and supplies

Other services and charges

Capital outlay

Total Public Safety Parks and Recreation: Personal services Material and supplies Other services and charges Capital outlay Total Parks and Recreation

36,268

36,267

314,030

165,690

148,340

199,813

134,147

65,666

350,323

201,958

148,365

199,813

134,147

65,666

Health & Welfare: Personal services

Materials and supplies

Other services and charges

Capital outlay

Total Health & Welfare Economic Development & Opp. Personal services

Materials and supplies

Other services and charges

Capital outlay

Total Economic Development & Opp Street: Personal services

Materials and supplies

Other services and charges

Capital outlay

179,275

55,671

123,604

Total Street

179,275

55,671

123,604

350,323

201,958

148,365

973,169

483,146

490,023

Total Expenditures Revenues over (under) expenditures

(246,973)

(187,718)

59,255

(895,669)

(397,007)

498,662

Other financing sources (uses): Transfers from other funds Transfers to other funds Revenues and other sources over (under) expenditures and other uses Fund Balance-beginning of year Fund Balance -end of year

126,000

35,217

(120,973)

(152,501)

225,804

104,831

73,303

(90,783) -

(31,528)

311,000

(584,669)

311,000

(86,007)

1,282,869 $

698,200

498,662

1,282,869 $

1,196,862

498,662 (continued)

119

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

Budget

1996 CIP TAX FUND

Variance Positive (Negative)

Actual

Budget

Variance Positive (Negative)

Actual

Revenues: Taxes

Intergovernmental

Charges for services

Investment income

1,640

Miscellaneous

1,640

Total Revenues

General Government: Personal services

Materials and supplies

Other services and charges

Capital outlay

Debt service

Total General Government Public Safety: Personal services

Materials and supplies

Other services and charges

Capital outlay

Total Public Safety Parks and Recreation: Personal services

Material and supplies

Other services and charges

Capital outlay

Personal services

Materials and supplies

Total Parks and Recreation Health & Welfare:

Other services and charges

Capital outlay

Personal services

Materials and supplies

Total Health & Welfare Economic Development & Opp.

Other services and charges

Capital outlay

Personal services

Materials and supplies

Total Economic Development & Opp Street:

Other services and charges

Capital outlay

Total Street Total Expenditures Revenues over (under) expenditures

(2)

(30)

1,610

1,640

Other financing sources (uses): Transfers from other funds

Transfers to other funds

1,610

1,640

Revenues and other sources over (under) expenditures and other uses

(2) 10,924

Fund Balance-beginning of year Fund Balance -end of year

10,922

10,924 $

11,016

(30)

184,845 $

184,815

184,845 $

186,455

1,640 (continued)

120

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

CITY OF EDMOND, OKLAHOMA SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE-BUDGETARY BASIS BUDGET AND ACTUAL - MAJOR GOVERNEMNTAL CAPITAL PROJECT FUND For the fiscal year ended June 30, 2016

Capital Project Funds 2000 Capital Improvement Tax Fund

Budget

2012 Public Safety Center Tax Fund Variance Positive Budget Actual (Negative)

Variance Positive (Negative)

Actual

REVENUES Taxes

$ 12,769,448

12,683,814

543,416

496,341

Contributed capital

Investment income

‐ ‐ 13,662,864

‐ ‐ 13,705,101

$ (85,634) ‐ ‐ 174,946 (47,075) ‐ ‐ ‐ 42,237

200

Other services and charges

128,936

Capital outlay

251,215

8,455,876

8,527,800

‐ ‐ 8,490,455

182

108,284

20,652

251,215

8,443,734

8,824,085

8,552,036

272,049

Investment income

350,000

524,946

Miscellaneous

Total revenues

8,512,800

Licenses and permits

Miscellaneous

$ (56,924) ‐ ‐ 19,579 ‐ ‐ ‐ ‐ (37,345)

Intergovernmental

15,000

34,579

EXPENDITURES -

General Government: Materials and supplies

Debt service Total General Government

‐

Public Safety: Materials and supplies

1,207,134

Other services and charges

749,130

263,662

485,468

Capital outlay

10,963,479

4,263,492

6,699,987

Debt service

Total Public Safety

‐

85,876

13,005,619

5,820,164

7,185,455

Parks and Recreation: 3,577,244

514,706

3,062,538

‐

3,577,244

514,706

3,062,538

‐

6,738,901

1,777,133

4,961,768

‐

6,738,901

1,777,133

4,961,768

‐

Capital outlay

18,918,621

10,325,797

8,592,824

‐

Total Street

18,918,621

10,325,797

8,592,824

‐

38,058,851

21,169,672

16,889,179

Capital outlay Total Parks and Recreation

Economic Development & Opp: Capital outlay

Total Economic Development & Opp Street:

Total Expenditures

(24,395,987)

Revenues over (under) expenditures

(7,464,571)

16,931,416

5,820,164

7,185,455

2,670,291

7,148,110

(4,477,819)

Other financing sources (uses): Proceeds from revenue bonds

Premium on revenue bonds

Transfer to escrow agent

Transfers from other funds Transfers to other funds

4,700,000

Total of other financing resources

Revenues and other sources over (under) expenditures and other uses

4,700,000

(19,695,987)

(2,764,571)

34,860,132

Fund Balance-beginning of year Fund Balance -end of year

4,700,000

15,164,145

32,095,561

121

(4,700,000)

(9,177,819)

(2,029,709)

16,931,416

34,860,132 $

16,931,416

31,499 $

(9,146,320)

7,148,110

31,499 $

(1,998,210)

7,148,110

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

NONMAJOR ENTERPRISE FUNDS The City operates eight enterprise funds under the legal entity of the Edmond Public Works Authority ("EPWA"), a public trust created under applicable Oklahoma statutes on October 6, 1970, with the City named as the beneficiary thereof. The Electric, Water and Wastewater enterprise funds are reported as Major funds. The remaining five enterprise funds are reported as nonmajor and include the following: SANITATION - Established to acquire and furnish sanitation services to the citizens, receive all revenues generated, pay debt service requirements on the debt issued related to the sanitation facility, pay all operating expenses, and finance future sanitation improvements. ARCADIA LAKE - Established to account for revenues and expenses related to the operations of the Arcadia Lake and Recreation Facility. DRAINAGE - Established to account for a fee assessed on each customer’s utility bill for construction and further improvements to the City’s drainage system. KICKINGBIRD GOLF COURSE - The Golf Course Fund accounts for the costs of operating and maintaining the City’s 18-hole municipal golf course. Revenues are generated through green fees, cart rentals, driving range fees and restaurant operations. YOURGOVSHOP - The YourGovShop Fund is a cooperative purchasing service, operated by the City, which provides its partners and members the lowest competitive prices for good and services, as well as a reduction in the administrative costs of purchasing. Financing is provided by revenues generated from rebates, membership fees and General Fund transfers. CityLink – The CityLink Fund is for the costs of operating and maintaining Edmond’s public transportation service through a reliable, affordable, customer-friendly transportation service to the residents of Edmond for access to employment, shopping, medical, education and social destinations. The General Fund along with sponsorship funds the operations of this service.

122

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Statement of Net Position Other Enterprise Funds June 30, 2016

PWA Sanitation Fund ASSETS Current assets: Cash and cash equivalents Investments Restricted assets: Cash and cash equivalents Investments Receivables: Accrued interest receivable Utility receivables, net of allowance for uncollectible accounts Due from other governments Other receivables Due from other funds Inventories Total current assets Non-current assets: Restricted assets: Cash and cash equivalents Investments Capital Assets: Nondepreciable Depreciable, net of accumulated depreciation Total non-current assets Total assets

DEFERRED OUTFLOWS OF RESOURCES Deferred charge on refunding Deferred amounts related to pensions Total deferred outflows of resources LIABILITIES Current liabilities: Accounts payable Accrued wages payable Accrued interest payable Due to other funds Compensated absences Meter deposit liability Revenue bonds payable Total current liabilities Non-current liabilities: Compensated absences Net OPEB obligation Net pension liability Revenue bonds payable, net Total non-current liabilities Total liabilities DEFERRED INFLOW OF RESOURCES Deferred amounts related to pensions NET POSITION Invested in capital assets, net of related debt Restricted for debt service Restricted for scholarships Unrestricted Total net position

549,934 4,649,213

PWA Arcadia Lake Fund

25,327 203,233

PWA Drainage Fund

Kickingbird Golf Course Fund

745,757 6,590,593

63,506 559,484

Yourgovshop Fund

CityLink

22,529 200,701

Total

63,118 319,279

1,470,171 12,522,503

249,696

729,848 16,839

52,743

227,663 4,941

957,511 324,219

10,751 949,397 4,500 6,413,491

449 975,696

14,579 221,892 177,083 7,802,647

1,228 2,114 75,114 934,050

440 29,155 252,825

700 287,654 670,751

28,147 1,171,289 289,768 33,655 177,083 75,114 17,049,460

329

100,756 161,231

32,288 51,668

133,044 213,228

387,988 388,317 6,801,808

495,278 3,675,490 4,432,755 5,408,451

120,908 7,309,053 7,429,961 15,232,608

578,162 1,159,445 1,821,563 2,755,613

252,825

670,751

1,194,348 12,531,976 14,072,596 31,122,056

5,240 254,865 260,105

62,182 75,232 137,414

76,281 76,281

19,927 137,487 157,414

6,096 6,096

8,281 8,281

87,349 558,242 645,591

365,839 46,560 5,842 16,916 9,698 249,696 43,211 737,762

7,326 27,876 22,749 3,809 1,000 345,871 408,631

1,291 13,385 3,637 52,743 71,056

101,832 45,306 7,290 6,221 110,837 271,486

1,071 366 1,437

16,206 1,046 142 17,394

492,494 135,244 35,881 16,916 23,873 303,439 499,919 1,507,766

87,278 109,862 507,707 262,467 967,314 1,705,076

34,210 26,345 149,048 2,100,355 2,309,958 2,718,589

32,723 22,049 151,956 206,728 277,784

55,985 63,352 270,074 673,073 1,062,484 1,333,970

3,293 2,192 12,141 17,626 19,063

1,275 1,333 16,496 19,104 36,498

214,764 225,133 1,107,422 3,035,895 4,583,214 6,090,980

878

453

3,284

4,615

87,550 5,268,409 5,355,959

1,786,724 984,925 55,627 2,827,276

7,429,961 7,600,691 15,030,652

973,624 309,270 1,301 294,862 1,579,057

239,858 239,858

639,250 639,250

10,277,859 1,294,195 1,301 14,098,697 25,672,052

123

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Statement of Revenues, Expenses and Changes in Fund Net Position Other Enterprise Funds For the Year Ended June 30, 2016 PWA Sanitation Fund REVENUES Charges for services Operating grants and contributions Miscellaneous Total operating revenues

OPERATING EXPENSES Personal services Materials and supplies Maintenance, operations and contractual services Depreciation Total Operating Expenses Operating income (loss)

NON-OPERATING REVENUES (EXPENSES) Interest and investment revenue Gain on capital asset disposal Interest expense Miscellaneous expenses Total non-operating revenue (expenses) Income (loss) before contributions and transfers Transfers in Transfers out Change in net position Total net position - beginning Total net position - ending

9,128,560 9,128,560

PWA Arcadia Lake Fund $

Kickingbird Golf Course Fund

1,876,612 1,876,612

1,739,705 16,315 278,734 2,034,754

Yourgovshop Fund $

63,524 63,524

CityLink $

Total

262,869 469,482 732,351

1,444,073 330,370 5,541,173 27,318 7,342,934 1,785,626

623,209 92,731 390,426 212,060 1,318,426 (239,995)

413,995 9,620 413,589 66,374 903,578 973,034

1,085,919 448,557 499,140 270,211 2,303,827 (269,073)

32,539 6 17,538 50,083 13,441

38,866 (10,097) 28,769

8,270 (46,275) (38,005)

64,100 (79) 64,021

6,757 (14,829) (8,072)

1,750 1,750

3,430 3,430

(278,000)

1,037,055

(277,145)

15,191

(560,823)

(354,737) 1,459,658

491,069 213,069

1,037,055

60,129 (217,016)

15,191

1,200,000 639,177

5,355,959

2,614,207 $

2,827,276

13,993,597 $

124

15,030,652

1,796,073 $

1,579,057

224,667 $

239,858

44,127 82,063 1,170,414 1,296,604 (564,253)

1,814,395

3,896,301 $

1,025,131 53,300 1,078,431

PWA Drainage Fund

3,643,862 963,347 8,032,280 575,963 13,215,452 1,698,780

123,173 (71,201) (79) 51,893 1,750,673 1,751,198 (354,737) 3,147,134

73 $

639,250

14,032,877 485,797 395,558 14,914,232

22,524,918 $

25,672,052

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Statement of Cash Flows Other Enterprise Funds For the Year Ended June 30, 2016

PWA Sanitation Fund CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers Payments to employees Interfund payments Interfund receipts Net cash provided (used) by operating activities

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers from other funds Transfer to other funds Net cash provided (used) by noncapital financing activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Purchase of capital assets Principal paid on capital debt Interest paid on capital debt Net cash provided (used) by capital and related financing activities CASH FLOWS FROM INVESTING ACTIVITIES Purchases of investments Sale of investments Interest and dividends Net cash provided (used) by investing activities Net Increase (decrease) in cash and cash equivalents Balances-beginning of year Balances-end of year

9,141,646 (5,889,952) (1,388,367) 310,071 2,173,398

PWA Arcadia Lake Fund $

1,078,431 (483,553) (599,312) (4,434)

(354,737) (354,737)

491,069 491,069

(739) (25,015) (12,412) (38,166)

(96,815) (69,238) (166,053)

(1,731,802) 35,978 (1,695,824)

(10,826) 7,700 (3,126)

84,671

317,456

465,263

538,475

PWA Drainage Fund

Kickingbird Golf Course Fund

1,853,964 (1,005,018) (391,797) (222,073) 235,076

2,204,870 (914,059) (1,036,858) 253,953

Yourgovshop Fund $

CityLink

63,524 (34,087) (31,319) (1,882)

Total

272,467 (1,405,877) (42,686) 54,600 (1,121,496)

14,614,902 (9,732,546) (3,490,339) (222,073) 364,671 1,534,615

60,129 60,129

1,200,000 1,200,000

1,751,198 (354,737) 1,396,461

(885,042) (885,042)

(58,886) (31,025) (22,188) (112,099)

(944,667) (152,855) (103,838) (1,201,360)

307,238 69,371 376,609

(107,214) 5,331 (101,883)

(5,872) 1,735 (4,137)

(56,413) 2,612 (53,801)

(1,912,127) 307,238 122,727 (1,482,162)

(273,357)

100,100

(6,019)

24,703

247,554

223,357

28,548

38,415

2,313,172

1,019,114

549,934

855,931

745,757

323,457

22,529

63,118

2,560,726

549,934 549,934

25,327 729,848 100,756 855,931

745,757 745,757

63,506 227,663 32,288 323,457

22,529 22,529

63,118 63,118

1,470,171 957,511 133,044 2,560,726

1,785,626

(239,995)

973,034

(269,073)

13,441

(564,253)

1,698,780

(287,654) 54,600 (153,089) (172,230) 171 (262) 1,221 (1,121,496)

Reconciliation of Operating Income to Net Cash Provided by Operating Activities: Operating income (loss) $ Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation expense Miscellaneous non-operating revenue (expense) Change in assets and liabilities: Receivables, net Inventories Due from other governments Due from other funds Accounts and other payables Due to other funds Unearned revenue OPEB obligation Pension liability Accrued compensated absences $ Net cash provided by operating activities

27,318 -

212,060 -

13,086

293,155 7,976 16,916 10,380 9,134 9,807 2,173,398

125

18,082 2,774 2,796 (151) (4,434)

66,374 (79)

(22,569) (118,818) (572,762) (103,255) 2,059 2,700 8,392 235,076

270,211 -

(280) 170,116 64,660 6,019 5,267 7,033 253,953

(15,824) 174 221 106 (1,882)

575,963 (79) (9,483) (280) (117,538) 228,937 (650,957) (86,339) (172,230) 21,577 19,856 26,408 1,534,615

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

INTERNAL SERVICE FUNDS The Internal Service Funds are used to account for the financing of administrative services provided by one department or function to other departments or functions of the City on a cost reimbursement basis. EMPLOYEE GROUP INSURANCE FUND - The Employee Group Insurance Fund has been established to account for the direct and indirect costs of administering a self-funded group health insurance plan. Financing is provided by the City, the Edmond Public Works Authority, City employees, and interest earnings on fund investments. Costs associated with the plan include the payment of employee and dependent health and dental claims, third party administrative costs, insurance premium payments for catastrophic claims, fully insured life, accidental death and dismemberment, and long term disability insurance. LIABILITY/TORT CLAIM FUND - The Liability/Tort Claim Fund has been established to account for direct and indirect costs for the payment of judgments and settled claims relating to torts and workerâ&#x20AC;&#x2122;s compensation. Financing is provided through billings to user departments. VEHICLE MAINTENANCE FUND - The Vehicle Maintenance Fund has been established to account for expenditures necessary to maintain City vehicles. Financing is provided through billings to user departments. FLEET MANAGEMENT FUND - The Fleet Management Fund has been established to accumulate resources for the replacement of vehicles and other equipment on a systematic basis. Financing is provided by fleet lease assessments to the General Fund, Park Sales Tax Fund, Administrative Support Services Fund, Edmond Public Works Authority, Fire Public Safety Limited Tax Fund and the Police Public Safety Limited Tax Fund. FIELD SERVICES FUND â&#x20AC;&#x201C; The Field Services Fund has been established to provide street maintenance, water/wastewater line maintenance and traffic control systems maintenance. Financing is provided by the General Fund, Water and Wastewater Fund based upon applicable cost accounting methods. ADMINISTRATIVE SUPPORT SERVICES FUND - The Administrative Support Services Fund has been established to account for and allocate administrative overhead costs to user departments of the City. Financing is provided through billings to user departments based upon applicable cost accounting methods.

126

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Statement of Net Position Internal Service Funds June 30, 2016

Group Insurance Fund ASSETS Current assets: Cash and cash equivalents Investments Receivables: Accrued interest Due from other governments Other receivables Due from other funds Inventories Total current assets Non-current assets: Capital Assets: Nondepreciable Depreciable, net of accumulated depreciation Total non-current assets Total assets

DEFERRED OUTFLOWS OF RESOURCES Deferred amounts related to pensions LIABILITIES Current Liabilities: Accounts payable Salaries payable Compensated absences Claims and judgments Total current liabilities Non-current liabilities: Compensated absences Net OPEB obligation Net pension liability Claims and judgments Total non-current liabilities Total liabilities DEFERRED INFLOW OF RESOURCES Deferred amounts related to pensions NET POSITION Invested in capital assets, net of related debt Unrestricted Total Net Position

661,894 5,896,264

Vehicle Maintenance Fund

53,813 479,386

Fleet Management Fund

Liability/Tort Claim Fund

572,270 3,761,655

866,218 7,716,423

Field Services Fund

Administrative Support Services Fund

247,937 2,208,673

384,862 3,408,821

Total

2,786,994 23,471,222

12,939 21,255 6,592,352

1,052 205,320 70,697 810,268

8,256 4,342,181

16,934 158,851 8,758,426

4,847 211,227 765,755 3,438,439

7,481 6,000 6,000 18,112 62,012 3,893,288

51,509 217,227 391,426 18,112 898,464 27,834,954

6,592,352

810,268

4,342,181

13,872,164 13,872,164 22,630,590

3,438,439

787,503 2,941,179 3,728,682 7,621,970

787,503 16,813,343 17,600,846 45,435,800

151,882

45,232

11,954

822,734

2,273,811

3,305,613

287,661 231,140 518,801

40,840 28,167 5,040 74,047

49,877 1,425 849,000 900,302

47,964 165 48,129

192,383 152,447 24,178 369,008

137,900 428,562 69,208 635,670

756,625 609,176 100,016 1,080,140 2,545,957

77,046 77,046 595,847

45,356 15,483 302,558 363,397 437,444

12,821 3,725 90,104 1,766,000 1,872,650 2,772,952

1,482 824 23,711 26,017 74,146

217,602 92,197 1,638,935 1,948,734 2,317,742

622,877 206,286 4,525,093 5,354,256 5,989,926

900,138 318,515 6,580,401 1,843,046 9,642,100 12,188,057

4,040

5,630

1,140

10,810

5,996,505 5,996,505

520,666 520,666

127

1,608,831 1,608,831

13,872,164 8,696,234 22,568,398

1,942,291 1,942,291

3,728,682 177,173 3,905,855

17,600,846 18,941,700 36,542,546

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Statement of Revenues, Expenses and Changes in Fund Net Position Internal Service Funds For the Year Ended June 30, 2016

Group Insurance Fund OPERATING REVENUES Charges for services Operating grants and contributions Miscellaneous Total operating revenues

OPERATING EXPENSES Personal services Materials and supplies Other services and charges Insurance premium expense Claims expense Depreciation Total operating expenses Operating income (loss)

9,176,247 4,647 9,180,894

Vehicle Maintenance Fund $

625 1,356,110 646,831 7,275,964 9,279,530 (98,636)

NON-OPERATING REVENUES (EXPENSES) Interest and investment revenue Loss on sale of capital assets Miscellaneous revenue Total non-operating revenue (expenses)

2,775,572 2,775,572

Liability/Tort Claim Fund $

847,504 1,506,131 502,281 2,855,916 (80,344)

1,769,674 245,664 2,015,338

Fleet Management Fund $

255,175 4,375 284,961 720,717 600,544 1,865,772 149,566

3,231,353 3,231,353

Field Services Fund

Administrative Support Services Fund

62,606 3,256 162,660 1,991,160 2,219,682 1,011,671

11,070,194 1,424,934 12,495,128

4,644,069 1,129,179 5,570,742 11,343,990 1,151,138

Total $

12,786,514 785,452 5,372,935 484,151 19,429,052 (2,626,240)

18,595,868 3,429,018 13,249,689 1,367,548 7,876,508 2,475,311 46,993,942 (492,845)

4,769 1,135 5,904

33,925 33,925

Income (loss) before contributions and transfers

(12,988)

(74,440)

183,491

1,045,559

1,163,531

(2,444,276)

(139,123)

Transfers in Transfers out Change in net position

(12,988)

(74,440)

183,491

1,045,559

1,163,531

(2,444,276)

(139,123)

Total net position - beginning

6,009,493 $

5,996,505

595,106 $

520,666

1,425,340 $

128

1,608,831

12,393 12,393

44,819,852 1,435,581 245,664 46,501,097

54,602 31,046 85,648

Total net position - ending

69,026 (54,598) 19,460 33,888

16,796,812 6,000 16,802,812

21,522,839 $

22,568,398

45,950 136,014 181,964

778,760 $

1,942,291

220,665 (54,598) 187,655 353,722

6,350,131 $

3,905,855

36,681,669 $

36,542,546

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Statement of Cash Flows Internal Service Funds For the Year Ended June 30, 2016

Group Insurance Fund CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers Payments to employees Claims and judgments paid Interfund payments Net cash provided (used) by operating activities

CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Purchase of capital assets Proceeds from sale of capital assets Net cash provided (used) by capital and related financing activities

9,294,453 (1,891,173) (7,334,309) 68,971

Vehicle Maintenance Fund $

2,768,441 (817,777) (1,964,031) (13,367)

CASH FLOWS FROM INVESTING ACTIVITIES Purchases of investments Sale of investments Interest and dividends Net cash provided (used) by investing activities Net Increase (decrease) in cash and cash equivalents Balances-beginning of year

Fleet Management Fund

Liability/Tort Claim Fund $

2,137,720 (990,191) (248,333) (722,544) 176,652

(267,834) 38,336 (229,498)

(5,486) 3,423 (2,063)

(160,527) 822,421

3,091,962 (293,837) (61,356) 2,736,769

Field Services Fund

Administrative Support Services Fund

12,283,901 (6,703,509) (4,462,384) 1,118,008

(1,966,398) 17,392 (1,949,006)

(1,049,931) 10,076 (1,039,855)

17,100,033 (6,240,225) (12,313,353) (6,210) (1,459,755)

Total $

46,676,510 (16,936,712) (19,049,457) (8,056,853) (6,210) 2,627,278

(231,831) (231,831)

(2,198,229) 17,392 (2,180,837)

1,355,838 34,302 1,390,140

(2,567,052) 1,355,838 158,495 (1,052,719)

(285,977) 23,718 (262,259)

(957,824) 48,640 (909,184)

(15,430)

(85,607)

(121,421)

78,153

(301,446)

69,243

657,877

987,639

169,784

686,308

(606,278) 3,393,272

Balances-end of year

661,894

53,813

572,270

866,218

247,937

384,862

2,786,994

Reconciliation to Combining Statement of Net Position: Cash, including time deposits Total cash and cash equivalents, end of year

$ $

661,894 661,894

$ $

53,813 53,813

$ $

572,270 572,270

$ $

866,218 866,218

$ $

247,937 247,937

$ $

384,862 384,862

$ $

2,786,994 2,786,994

(98,636)

(80,344)

149,566

1,011,671

1,151,138

Reconciliation of Operating Income to Net Cash Provided by Operating Activities: Operating income (loss) $ Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation expense Miscellaneous non-operating revenue (expense) Change in assets and liabilities: Receivables, net Other receivable Inventories Deposits with TPA Prepaid expenses Due from other governments Due from other funds Deferred outflows related to pension Accounts and other payables Claims liability Due to other funds Customer meter deposits payable OPEB obligation Pension liability Deferred inflows related to pension Accrued compensated absences $ Net cash provided by operating activities

31,046

1,135

82,513 112,393 (58,345) 68,971

(8,266) 46,868 (88,764) 16,299 6,012 167,503 (73,791) (19) (13,367)

129

122,382 (24,302) 23,448 (122,000) 1,216 45,320 (20,179) 1,201 176,652

1,991,160 19,460

(158,851) (7,121) (126,373) 285 13,370 (5,960) (872) 2,736,769

(211,227) 20,208 (490,741) 76,841 33,579 928,561 (408,243) 17,892 1,118,008

(2,626,240)

484,151 136,014

167,207 (11,195) (6,000) (6,210) (1,360,063) 217,670 77,978 2,569,926 (1,126,747) 23,754 (1,459,755)

(492,845) 2,475,311 187,655

(6,242) 55,881 (6,000) (6,210) (1,970,991) 320,278 (180,345) 119,070 3,724,680 (1,634,920) 41,956.00 2,627,278

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

AGENCY FUNDS Agency Funds are used to account for assets held by the City as an agent for individuals, private organizations, and other governmental funds. Agency Funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. SIDEWALK AND DRIVEWAY ESCROW FUND accounts for contractor performance deposits held by the City on various City construction projects. The deposits are refunded after the projects have been satisfactorily completed. CLEET ASSESSMENT FUND accounts for the receipt of a State mandated penalty assessment on all City fines and forfeitures to be collected by the City and remitted quarterly to the State for its law enforcement training fund.

130

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

City of Edmond, Oklahoma Combining Statement of Fiduciary Assets and Liabilities Agency Funds June 30, 2016 C.L.E.E.T. PENALTY ASSESSMENT FUND

Sidewalk and Driveway Escrow Fund ASSETS Cash and cash equivalents

TOTALS

613,745

40,117

653,862

Total assets

613,745

40,117

653,862

LIABILITIES Accounts payable Refundable deposits

613,745

18,534 21,583

18,534 635,328

613,745

40,117

653,862

Total liabilities

City of Edmond, Oklahoma Combining Statement of Changes in Assets and Liabilities Agency Funds For the fiscal year ended June 30, 2016

BALANCE JUNE 30, 2015 SIDEWALK AND DRIVEWAY ESCROW Assets: Cash and cash equivalents

ADDITIONS

DEDUCTIONS

BALANCE JUNE 30, 2016

1,022,396

1,064,790

1,473,441

613,745

1,022,396

1,064,790

1,473,441

613,745

LIABILITIES Refundable deposits

1,022,396

1,064,790

1,473,441

613,745

Total liabilities

1,022,396

1,064,790

1,473,441

613,745

37,626

162,747

160,256

40,117

37,626

162,747

160,256

40,117

15,963 21,663

151,215 11,532

148,644 11,612

18,534 21,583

37,626

162,747

160,256

40,117

1,060,022

1,227,537

1,633,697

653,862

1,060,022

1,227,537

1,633,697

653,862

15,963 21,663 1,022,396

151,215 11,532 1,064,790

148,644 11,612 1,473,441

18,534 21,583 613,745

1,060,022

1,227,537

1,633,697

653,862

Total assets

C.L.E.E.T. PENALTY ASSESSMENT FUND Assets: Cash and cash equivalents Total assets LIABILITIES Accounts payable Due to other governments Total liabilities

TOTALS-ALL AGENCY FUNDS Assets: Cash and cash equivalents Total assets LIABILITIES Accounts payable Due to other governments Refundable deposits Total liabilities

131

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

REVENUE BOND/NOTE COVENANT SCHEDULES The revenue bond and note agreements and indentures contain certain financial related covenants dealing with minimum requirements for net pledged revenue and minimum reserve account balance requirements. The following schedules are presented to indicate the level of compliance by the City or its public trusts with these covenants. Schedule of Revenue Bond/Note Debt Service Coverage This schedule compares the net revenues generated from revenues sources pledged for the payment of principal and interest of revenue bond and notes to the maximum annual debt service requirements on the debt. Schedule of Reserve Account Balances This schedule compares the amount of assets held in trust as reserve accounts related to revenue bonds and notes to the required balances to be maintained in these accounts as required by the debt covenants.

132

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

CITY OF EDMOND, OKLAHOMA SCHEDULE OF REVENUE BOND/NOTE DEBT SERVICE COVERAGE For the fiscal year ended June 30, 2016 Sales Tax and Utility Revenue Bonds Series 2010, 2012, 2013 2014, and 2014B

OWRB/Bank of America Notes Payable Series 2005C and 2013 General Sales Revenue Note GROSS REVENUES OF THE SYSTEM: Charges for services Intergovernmental Investment income Miscellaneous income

Total Gross Revenues of the System

137,389,113 2,219 833,399 178,680

Utility Revenue Bonds Series 2014 and 2015

137,389,113 2,219 833,399 178,680

138,403,411

8,778,230 2,200,067 83,685,034 -

8,778,230 2,200,067 83,685,034 8,551,554

8,778,230 2,200,067 83,685,034 -

94,663,331

103,214,885

94,663,331

Total Gross Revenues of the System in Excess of Total Operation and Maintenance Expenses

43,740,080

35,188,526

43,740,080

Add: Pledged sales tax revenue

33,612,108

12,683,814

OPERATION AND MAINTENANCE EXPENSES: Personal services Materials and supplies Maintenance, operations and contractual services Debt service on prior lien utility system revenue bonds Total Operation and Maintenance Expenses

Net Revenues of the System plus pledged sales tax revenue

77,352,188

47,872,340

56,423,894

Maximum Debt Service Requirements on Liabilities

6,954,274

7,455,266

6,954,274

Computed Coverage Coverage Requirement

1112%

642%

811%

125%

NOTE: Revenues and expenses include only amounts related to the electric, water, wastewater, and sanitation funds. Operating expenses exclude depreciation, amortization and other non-cash items, in accordance with the terms of the applicable bond indentures. Maximum Debt Service Requirements on Liabilities is based on the following: Sales Tax and Utility System Revenue Bonds total debt service for the 2010, 2012, 2013 and 2014, 2014B series bonds in fiscal year 2021. Utility System Revenue Bonds total debt service for the 2014 and 2015 series bonds and OWRB notes payable in fiscal year 2025.

133

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

CITY OF EDMOND, OKLAHOMA SCHEDULE OF RESERVE ACCOUNT BALANCES JUNE 30, 2016

RESERVE BALANCE JUNE 30, 2016

REQUIRED RESERVES Required Balance: Series 2010 Sales Tax and Utility Revenue Bonds Series 2012 Sales Tax and Utility Revenue Bonds Series 2013 Sales Tax and Utility Revenue Bonds Series 2014 Sales Tax and Utility Revenue Bonds Series 2014B Sales Tax and Utility Revenue Bonds Series 2015 Utility Revenue Bonds

1,390,000 1,325,500 1,434,939 2,496,505 2,245,000 2,269,935

134

1,482,569 1,415,357 1,442,970 2,618,245 2,337,540 2,300,156

EXCESS BALANCE OVER REQUIRED RESERVES

92,569 89,857 8,031 121,740 92,540 30,221

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

DISCRETELY PRESENTED COMPONENT UNIT Additional information for the discretely presented component unit referred to in the notes to the financial statements is provided. HISTORIC PRESERVATION TRUST Created November 15, 1982 to preserve the qualities relating to the history of the City in order to promote the economic and general welfare of the people of the City of Edmond and to ensure the harmonious, orderly and efficient growth and development of the municipality. The EHPT governing body is appointed by the current City Council. The City is able to impose its will on the EHPT because, pursuant to state law, all issuance of EHPT debt requires a two-thirds approval of the City Council. The EHPT component unit does not issue separate financial statements.

135

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

CITY OF EDMOND, OKLAHOMA BALANCE SHEET DISCRETELY PRESENTED COMPONENT UNIT June 30, 2016 HISTORIC PRESERVATION TRUST ASSETS Cash and cash equivalents

92,010

Unreserved

92,010

Total liabilities and fund balances

92,010

Total assets LIABILITIES AND FUND BALANCES Fund Balances:

Reconciliation to Statement of Net Position: Fund balance Amounts reported for the discretely presented component unit 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. Net position of component unit

195,230 $

136

287,240

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

CITY OF EDMOND, OKLAHOMA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE DISCRETELY PRESENTED COMPONENT UNIT FOR THE FISCAL YEAR ENDED June 30, 2016 HISTORIC PRESERVATION TRUST Revenues: Investment income

Miscellaneous Total Revenues

146 2,500 2,646

Expenditures: Current: Culture, parks and recreation Total Expenditures

24,586 24,586

Revenues over (under) expenditures

(21,940)

Other financing sources: Payment from the City of Edmond

25,005

Net change in fund balance Fund balances - beginning Fund balances - ending

3,065 88,944 92,009

3,065

Reconciliation to Statement of Activities: Net Change in fund balance

Amounts reported for the discretely presented component unit in the Statement of Activities are difference because: Governmental funds report capital outlays as expenditures while governmental activities report depreciation expense to allocate those expenditures over the life of the assets: Depreciation expense

(28,503)

Change in net position - component unit

137

(25,438)

CITY OF EDMOND, OKLAHOMA ANNUAL FINANCIAL REPORT June 30, 2016

THIS PAGE INTENTIONALLY LEFT BLANK

138

STATISTICAL SECTION

STATISTICAL SECTION This part of the City of Edmond’s comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the city’s overall financial health Such statistical information includes: FINANCIAL TRENDS – These schedules contain trend information to help the reader understand how the city’s financial performance and well-being have changed over time REVENUE CAPACITY – These schedules contain information to help the reader assess the city’s most significant local revenue sources, gas and sales tax revenues. DEBT CAPACITY –These schedules present information to help the reader assess the affordability of the city’s current levels of outstanding debt and the city’s ability to issue additional debt in the future. DEMOGRAPHIC AND ECONOMIC INFORMATION – These schedules offer demographic and economic indicators to help the reader understand the environment within which the city’s financial activities take place OPERATING INFORMATION – These schedules contain service and infrastructure data to help the reader understand how the information in the city’s financial report relates to the services the city provides and the activities it performs.

139

140

Total primary government net position

Restricted Unrestricted

Invested in capital assets, net of related debt

Primary government

Total business-type activities net position

Restricted Unrestricted

Invested in capital assets, net of related debt

Business-type activities

Total governmental activities net position

Restricted Unrestricted

Invested in capital assets, net of related debt

Governmental activities

$ 406,386,612

77,225,712

73,414,253 $ 379,655,869

74,239,835

$ 254,921,065

70,439,572

$ 235,802,044

$ 184,814,329

55,106,883

51,072,155 $ 173,244,715

10,563,415

$ 119,144,031

10,181,517

$ 111,991,043

$ 221,572,283

22,118,829

22,342,098 $ 206,411,154

63,676,420

$ 135,777,034

2008

60,258,055

$ 123,811,001

2007

$ 443,022,076

66,197,302

77,553,436

$ 299,271,338

$ 201,953,367

61,950,616

10,899,446

$ 129,103,305

$ 241,068,709

4,246,686

66,653,990

$ 170,168,033

2009

$ 459,761,469

61,802,684

77,569,849

$ 320,388,936

$ 209,344,724

63,999,452

11,431,161

$ 133,914,111

$ 250,416,745

(2,196,768)

66,138,688

$ 186,474,825

2010

$ 438,476,679

77,523,268

77,890,093

$ 283,063,318

$ 202,648,441

61,237,819

11,102,953

$ 130,307,669

$ 235,828,238

16,285,449

66,787,140

$ 152,755,649

2011

463,247,233

80,496,896

78,176,478

304,573,859

214,648,289

62,638,338

12,737,861

139,272,090

248,598,944

17,858,558

65,438,617

165,301,769

2012

503,210,169

80,828,706

90,642,782

331,738,681

229,460,550

63,641,836

13,161,823

152,656,891

273,749,619

17,186,870

77,480,959

179,081,790

2013

$ 539,200,463

84,927,162

87,213,643

$ 367,059,658

$ 244,282,733

65,352,440

12,665,793

$ 166,264,500

$ 294,917,730

19,574,722

74,547,850

$ 200,795,158

2014

544,543,865

32,336,370

83,082,862

429,124,633

273,388,125

85,095,133

10,164,237

178,128,755

271,155,740

(52,758,763)

72,918,625

250,995,878

2015

$ 600,605,187

85,766,580

73,265,628

$ 441,572,979

$ 313,588,448

115,979,906

11,122,065

$ 186,486,477

$ 287,016,739

(30,213,326)

62,143,563

$ 255,086,502

2016

CITY OF EDMOND, OKLAHOMA NET POSITION BY COMPONENT Last Ten Fiscal Years TABLE 1

141

Program Revenues Government activities: Charges for services: General government Public Safety Streets and highways Cultural, parks and recreation Health and welfare Operating grants and contributions Capital grants and contributions Total governmental activities program revenues

Expenses Government activities: General government Public safety Streets and highways Cultural, parks and recreation Health and welfare Economic development Interest on long-term debt Total governmental activities expenses Business-type activities: Electric operations Water operations Wastewater operations Sanitation operations Lake operations Drainage operations Golf course operations Cooperative purchasing services Transportation operations Economic development (payment to EEDA) Total business-type activities expenses Total primary government expenses 4,613,635 33,046,090 6,621,593 4,394,149 1,334,982 846,548 3,696,158 54,553,155

6,452,852 1,310,158 9,030 419,224 5,233,942 16,974,830 30,400,036

57,623,476 13,081,626 4,649,588 5,311,871 1,117,566 626,863 1,717,156 67,999 405,305 84,601,450 $ 139,154,605

2007

3,478,447 36,253,944 7,758,419 4,875,902 1,429,278 3,575,609 57,371,599

7,308,113 1,184,312 7,650 538,322 4,902,301 5,968,765 19,909,463

55,694,109 14,909,423 5,554,642 6,100,704 1,194,252 814,071 1,786,557 63,194 417,459 86,534,411 $ 143,906,010

2008

6,481,160 36,973,162 9,037,694 5,108,657 1,788,220 3,446,624 62,835,517

7,108,368 821,340 104,770 538,937 4,036,616 17,642,392 30,252,423

58,763,582 15,248,010 5,744,638 5,999,807 1,251,923 822,836 1,931,136 58,693 430,000 90,250,625 $ 153,086,142

2009

10,973,617 37,861,256 10,628,715 5,460,930 2,568,303 3,303,605 70,796,426

7,370,016 831,720 228,097 514,150 689,333 4,878,847 16,112,303 30,624,466

60,634,285 15,676,576 5,614,980 6,279,124 1,174,818 934,104 1,762,760 41,299 442,900 92,560,846 $ 163,357,272

2010

5,031,798 39,468,587 10,186,548 5,419,709 2,879,900 3,060,764 66,047,306

7,604,193 946,769 7,200 719,757 1,167,687 5,547,074 5,176,962 21,169,642

65,755,607 16,360,858 5,351,923 6,673,527 1,255,232 953,486 1,914,021 64,215 412,000 98,740,869 $ 164,788,175

2011

7,354,958 38,482,564 10,413,380 5,163,602 3,154,842 107,884 2,825,422 67,502,652

7,353,230 1,220,778 84,870 528,606 1,140,753 5,475,330 5,232,894 21,036,461

68,889,466 16,769,702 5,719,033 6,953,312 1,271,935 1,020,667 1,907,157 64,757 440,000 103,036,029 $ 170,538,681

2012

7,931,878 41,599,381 10,787,542 4,742,925 3,173,294 72,066 2,478,720 70,785,806

7,421,872 1,246,610 11,670 536,743 1,135,962 5,682,716 10,668,747 26,704,320

72,308,154 16,804,561 6,495,234 6,797,466 1,289,412 887,642 1,928,258 62,844 470,000 107,043,571 $ 177,829,377

2013

6,356,170 43,468,774 12,768,311 5,986,917 1,629,424 603,679 2,316,938 73,130,213

7,934,422 1,267,798 10,200 518,039 931,947 5,498,584 7,002,940 23,163,930

74,045,803 19,668,782 6,766,403 7,101,930 1,332,453 827,838 1,970,350 62,210 1,568,426 113,344,195 $ 186,474,408

2014

6,284,407 43,371,086 13,111,395 8,532,349 1,510,407 644,296 1,527,392 74,981,332

7,945,577 1,213,991 101,877 410,001 916,854 5,867,612 10,227,919 26,683,831

75,458,152 19,838,405 7,138,969 6,876,040 1,351,272 916,310 2,079,169 63,641 1,594,042 115,316,000 $ 190,297,332

2015

9,167,431 47,309,195 15,151,636 7,067,735 1,639,425 576,728 1,828,757 82,740,907

(Continued)

7,259,773 1,188,473 23,422 161,863 869,997 6,040,401 10,189,610 25,733,539

75,312,602 17,495,184 7,224,538 7,052,119 1,364,701 903,578 2,318,656 50,083 1,296,604 113,018,065 $ 195,758,972

2016

CITY OF EDMOND, OKLAHOMA CHANGES IN NET POSITION Last Ten Fiscal Years TABLE 2

142

$ (24,153,119) 20,971,057 $ (3,182,062)

59,686,400 16,065,410 6,368,712 6,089,940 694,523 841,717 1,634,283 111,752 14,079,770 105,572,507 $ 135,972,543

27,026,149 33,285,506 60,311,655 $

15,161,126 11,569,613 26,730,739

2,829,720 180,998 294,193 (1,604,942) 1,699,969 54,323,231

27,558,790 4,742,710 1,580,904 9,485,420 1,866,394 417,905 761,720 4,229,091 284,237 1,604,942 52,623,262

$ (37,462,136) 9,869,644 $ (27,592,492)

57,936,121 15,876,990 6,887,906 6,221,070 640,316 1,571,298 1,731,594 70,085 107,870 5,360,805 96,404,055 $ 116,313,518

2008

* 2014 Transportation operations was established as a BTA instead of Governmental Activity

Change in Net Position Government activities Business-type activities Total primary government

General Revenues and Other Changes in Net Assets Government activities: Taxes: Sales and use taxes - General government $ 26,208,998 Sales and use taxes - Public safety 4,527,512 Sales and use taxes - Park and recreation 1,509,171 Sales and use taxes - Capital improvements 9,055,024 Franchise and public service taxes 1,699,807 336,159 Hotel/motel taxes Intergovernmental revenue not restricted to specific 749,106 Investment income 4,882,714 Miscellaneous 228,030 Gain (loss) on sale of capital assets Transfers-Internal activity 1,839,066 Total governmental activities 51,179,268 Business-type activities: Investment earnings 2,603,501 Miscellaneous 9,771 Special item - gain on asset impairment 1,130,316 Transfers - Internal activity (1,839,066) Total business-type activities (702,221) Total primary government $ 50,477,047

Government activities Business-type activities Total primary government net expense

Net (Expense)/Revenue

Operating grants and contributions Capital grants and contributions Total business-type activities program revenues Total primary government program revenues

Business-type activities: Charges for services: Electric operations Water operations Wastewater operations Sanitation operations Lake operations Drainage operations Golf course operations Cooperative purchasing service Transportation operationsâ ą

2007

19,496,428 17,139,001 36,635,429

1,925,301 158,658 (64,102) (1,733,927) 285,930 52,365,452

29,572,916 5,014,947 1,671,649 10,029,894 1,961,519 364,232 694,962 2,515,207 216,763 (1,696,494) 1,733,927 52,079,522

(32,583,094) 16,853,071 (15,730,023)

64,787,581 16,132,835 6,562,672 7,005,326 770,288 1,579,935 1,809,868 63,693 82,117 8,309,381 107,103,696 $ 137,356,119

2009

9,348,038 7,391,355 16,739,393

1,113,106 1,029,229 (1,751,799) 390,536 49,910,534

27,484,883 4,748,676 1,582,892 9,497,352 1,886,700 345,208 675,890 1,294,216 252,382 1,751,799 49,519,998

(40,171,960) 7,000,819 (33,171,141)

63,074,399 15,309,866 6,231,244 7,246,382 764,675 1,630,168 1,711,166 53,641 2,717 3,537,407 99,561,665 $ 130,186,131

2010

6,661,245 10,054,242 16,715,487

991,181 176,357 (1,066,444) 101,094 51,640,003

28,917,747 4,914,564 1,638,188 9,829,129 2,304,910 344,968 981,492 1,299,271 242,196 1,066,444 51,538,909

(44,877,664) 9,953,148 (34,924,516)

65,175,715 20,660,467 7,150,976 7,409,205 868,456 1,625,597 1,879,253 49,240 225,488 3,649,620 108,694,017 $ 129,863,659

2011

12,770,676 11,999,845 24,770,521

780,709 506,071 (3,475,226) (2,188,446) 57,048,421

31,299,351 5,366,325 1,788,775 12,798,391 2,106,551 391,664 894,306 822,610 293,668 3,475,226 59,236,867

(46,466,191) 14,188,291 (32,277,900)

71,935,412 22,701,466 8,554,554 7,577,025 880,719 1,758,988 1,997,414 80,190 72,975 1,665,577 117,224,320 $ 138,260,781

2012

25,150,675 14,812,261 39,962,936

481,283 260,120 (2,795,080) (2,053,677) 67,178,484

34,403,578 5,870,777 1,956,926 19,569,255 2,157,871 421,979 1,101,004 608,693 346,998 2,795,080 69,232,161

(44,081,486) 16,865,938 (27,215,548)

70,744,562 22,891,181 9,923,751 7,813,513 846,471 1,684,899 2,012,055 82,326 921,297 6,989,454 123,909,509 $ 150,613,829

2013

21,168,111 14,822,183 35,990,294

797,046 284,533 (1,558,620) (477,041) 70,657,353

36,065,782 6,094,618 2,031,539 20,315,394 2,269,717 443,663 1,078,777 825,927 450,357 1,558,620 71,134,394

(49,966,283) 15,299,224 (34,667,059)

76,674,353 22,931,346 11,423,965 8,065,999 963,845 1,703,753 1,997,086 74,389 290,470 328,568 4,189,645 128,643,419 $ 151,807,349

2014

$ 24,951,181 30,844,894 $ 55,796,075

659,037 171,402 (501,074) 329,365 $ 73,578,047

$ 37,777,579 6,318,872 2,106,291 21,062,907 2,327,317 453,376 1,158,392 815,222 727,652 501,074 73,248,682

$ (49,966,283) 30,515,529 $ (19,450,754)

$ 87,756,233 22,666,769 12,531,903 8,955,701 942,661 1,769,513 2,024,187 89,516 226,136 258,503 8,610,407 145,831,529 $ 172,515,360

2015

$ 15,861,001 40,200,323 $ 56,061,324

917,706 669,672 1,587,378 $ 74,455,747

$ 38,186,535 6,341,907 2,113,969 21,139,690 2,281,490 464,362 1,060,789 933,373 1,015,926 (669,672) 72,868,369

$ (57,007,368) 38,612,945 $ (18,394,423)

$ 91,957,403 25,066,076 13,377,584 9,128,560 1,078,431 1,876,533 2,018,439 63,524 262,869 308,943 6,492,648 151,631,010 $ 177,364,549

2016

CITY OF EDMOND, OKLAHOMA TABLE 2 (Continued)

143

$ 90,704,271

GRAND TOTAL

$ 88,336,986

24,031,157 35,556,974 5,184,515 5,453 2,606,709 $ 80,214,586

$ 7,229,922 -

$ 3,771,989 2,841,745 $ 8,122,400

2008

$ 81,228,464

22,314,064 35,121,329 4,202,565 1,619,906 $ 74,614,730

$ 7,329,922 -

$ 3,573,228 2,005,534 $ 6,613,734

2009

$ 76,166,548

32,566,108 9,733,245 19,253,710 $ 70,587,786

$ 7,314,772 -

$ 1,770,558 4,985,485 $ 5,578,762

2010

65,078,915 2,879 1,617,875 -

$ 75,623,878

$ 68,867,835

1,637,707 2,702,404 5,150,248 $ 6,756,043

2011

NOTE: Beginning in FY 2011 the City implemented GASB Statement 54, changing the categories of Fund Balance

23,989,752 41,902,706 3,454,075 (3,701) 2,371,829 $ 82,265,817

$ 8,499,925 -

$ 3,929,627 4,192,773 $ 8,438,454

All Other Governmental Funds Reserved Restricted Committed Assigned Unassigned Unreserved, reported in: Designated Undesignated Special revenue funds Debt service funds Capital project funds Total all other governmental funds

General Fund Reserved Unreserved Restricted Committed Assigend Unassigned Total general fund

2007

63,331,400 3,613 1,905,771 -

$ 74,731,143

$ 65,240,784

2,107,217 1,643,231 5,904,708 $ 9,490,359

2012

74,827,114 7,352 3,593,792 -

$ 89,665,407

$ 78,428,258

2,644,344 1,822,138 6,770,667 $ 11,237,149

2013

71,339,026 11,733 4,706,939 -

$ 88,643,849

$ 76,057,698

3,197,753 578,249 1,434,645 7,375,504 $ 12,586,151

2014

61,708,614 11,530 5,077,958 -

$ 77,763,551

$ 66,798,102

2,962,254 1,947,137 6,056,058 $ 10,965,449

2015

59,241,768 8,902 5,867,853 (1,999,113)

2,889,481 1,120,870 3,142,639 7,152,990

$ 70,272,400

$ 63,119,410

2016

CITY OF EDMOND, OKLAHOMA FUND BALANCES, GOVERNMENTAL FUNDS Last Ten Fiscal Years TABLE 3

144

Net change in fund balances

Debt service as a percentage of noncapital expenditures

Transfers in Transfers out Transfer to escrow agent Bond premium Bond proceeds Total other financing sources(uses)

Excess of revenues over(under) expenditures

Other financing sources(uses)

General government Public safety Streets and highways Cultural, Parks and Recreation Health and welfare Economic development Capital Outlay Debt service: Principal Interest and fiscal charges Total Expenditures

Expenditures:

Sales and use taxes Franchise and public service taxes Ad valorem taxes Hotel/motel taxes Intergovernmental Charges for services Fines and forfeitures Licenses and permits Investment income Interest earning on interfund loan Miscellaneous Total Revenues

Revenues

14.7%

(2,367,285)

52,520,218 (50,457,115) 2,063,103

(4,430,388)

3,291,203 3,751,922 74,566,808

6,227,383 32,337,759 3,963,803 3,525,388 1,275,167 841,541 19,352,642

41,300,705 1,735,492 107,529 336,159 13,106,317 4,532,811 2,368,946 1,275,103 4,756,318 617,040 70,136,420

2007

5,927,876 35,466,386 4,421,445 3,837,910 1,369,320 18,500,852

(8,900,224)

13.3%

(7,108,523)

$ 54,816,508 (53,024,807) $ 1,791,701

3,411,203 3,632,019 $ 76,567,011

$ 43,367,824 1,865,472 93,730 417,905 8,251,646 5,121,590 2,424,600 1,418,060 4,304,185 401,775 $ 67,666,787

2008

5,380,418 35,183,104 3,333,924 3,777,614 1,549,305 18,312,319

(7,133,881)

12.6%

(5,061,913)

$ 60,118,792 (58,046,824) $ 2,071,968

3,445,000 3,498,724 $ 74,480,408

$ 46,289,406 1,995,831 364,232 7,292,287 4,980,864 2,375,687 1,063,724 2,402,614 581,882 $ 67,346,527

2009

4,839,694 36,047,474 3,098,018 3,684,873 2,313,124 12,507,394

(2,694,471)

13.4%

(542,672)

$ 54,742,916 (52,591,117) $ 2,151,799

3,595,000 3,355,705 $ 69,441,282

$ 43,313,803 1,885,284 345,208 9,707,740 6,209,535 2,097,681 1,083,211 1,641,489 462,860 $ 66,746,811

2010

5,382,504 37,953,732 3,920,453 3,904,840 2,624,963 10,068,623

(2,302,948)

12.0%

566,351

$ 57,700,798 (55,064,383) (13,667,116) 13,900,000 $ 2,869,299

3,370,000 2,797,592 $ 70,022,707

$ 45,299,628 2,341,305 344,968 6,776,753 6,750,908 2,436,202 1,082,107 1,271,330 1,416,558 $ 67,719,759

2011

5,239,393 37,732,090 2,897,088 4,494,049 4,164,797 296,685 19,112,591

(4,684,868)

11.2%

(1,294,086)

$ 62,738,138 (59,347,356) $ 3,390,782

4,095,000 2,852,354 $ 80,884,047

$ 51,252,842 2,106,551 391,664 10,805,328 6,633,164 2,068,170 1,525,110 823,014 593,336 $ 76,199,179

2012

6,339,565 40,600,947 2,909,278 4,858,017 4,350,720 28,076,563

(3,897,300)

8.9%

$ 14,769,464

$ 69,839,503 (66,985,905) (12,477,058) 1,325,224 26,965,000 $ 18,666,764

4,495,000 2,458,647 $ 94,088,737

$ 61,800,536 2,199,488 421,979 14,086,717 6,816,347 2,053,931 1,389,282 675,831 747,326 $ 90,191,437

2013

6,170,708 42,576,993 1,374,487 5,152,798 4,436,186 26,031,528

13.8%

$ (1,021,558)

$ 68,979,432 (67,435,112) (12,376,172) 1,221,619 12,644,906 $ 3,034,673

$ (4,056,231)

5,988,514 2,509,629 $ 94,240,843

$ 64,507,333 2,311,150 443,663 10,904,286 6,801,451 2,099,735 1,608,680 799,873 708,441 $ 90,184,612

2014

6,812,288 45,697,743 1,255,580 5,235,819 4,843,989 33,392,516

9.9%

$ (10,880,298)

$ 75,715,179 (75,214,105) (21,731,628) 2,467,717 20,755,000 $ 1,992,163

$ (12,872,461)

5,328,286 2,363,880 $ 104,930,101

$ 67,265,649 2,371,750 453,376 9,686,171 6,871,742 1,809,016 1,769,355 778,705 30,640 1,021,236 $ 92,057,640

2015

(6,821,479)

6,364,851 2,164,759 96,585,499

5,937,535 49,182,140 6,354,224 4,696,132 1,384,677 576,728 19,924,453

464,362 7,450,843 6,311,280 1,641,283 1,412,552 845,306 85,876 1,488,927 89,764,020

67,782,101 2,281,490

11.1%

(7,491,151)

52,673,556 (53,343,228) $ (669,672)

2016

CITY OF EDMOND, OKLAHOMA CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS Last Ten Fiscal Years TABLE 4

145

42,592,891 48,573,889 58,707,772 60,946,182 63,188,721 63,419,072

2008

2009

2011

2012

2013

2014

2015

2016

41,155,192

43,462,875

41,103,489

92,692

2007

39,238,438

106,031

Sales Tax

2006

Fiscal Year

Ad Valorem Tax

4,363,029

4,076,928

3,561,151

3,092,764

2,678,953

2,706,737

2,158,611

2,826,531

2,264,335

2,062,267

Use Tax

2,231,857

2,282,884

2,228,284

2,116,254

2,066,159

2,301,455

1,848,384

1,924,619

1,836,994

1,699,807

Franchise Tax

49,633

44,433

41,433

41,617

40,392

39,850

36,900

29,400

37,650

Liquor Tax

464,362

453,376

443,663

421,979

391,664

344,968

345,208

364,232

417,905

336,159

Hotel/ Motel Tax

70,527,953

70,046,342

67,220,713

64,380,386

53,751,057

47,985,901

45,544,295

48,615,157

45,744,815

43,480,352

Totals

CITY OF EDMOND, OKLAHOMA GOVERNMENTAL ACTIVITIES TAX REVENUES BY SOURCE Last Ten Fiscal Years TABLE 5

146

57,637,268

34,186,769 17,187,660 974,507 5,288,332

63,703,216

38,174,103 18,854,931 963,824 5,710,357

2009

61,594,388

37,654,681 17,716,150 859,249 5,364,308

2010

2011

$ 63,667,237

$ 39,450,423 17,706,025 846,672 5,664,118

Note: Data is presented only for years including and subsequent to implementation of GASB 44.

Source: City of Edmond Utility Customer Service Department

Totals

Residential Commercial Large Commercial & Industrial Other

2008

$ 71,938,538

$ 44,917,923 20,110,914 879,907 6,029,794

2012

$ 69,154,723

$ 42,678,657 19,814,031 855,677 5,806,358

2013

$ 74,756,122

$ 45,419,073 21,837,857 920,361 6,578,831

2014

$ 78,135,179

$ 49,882,043 20,854,463 779,163 6,619,510

2015

$ 89,935,863

$ 54,344,401 26,186,761 1,136,853 8,267,848

2016

CITY OF EDMOND, OKLAHOMA ELECTRICITY REVENUE BY CUSTOMER TYPE LAST NINE FISCAL YEARS TABLE 6

147

Crest Foods

$ 57,637,268

Total Electric Revenue (see Table 6)

Source: City of Edmond Utility Customer Service Department

5,884,460

257,523

237,446

281,402

334,020

206,106

McCarthy Bldg Co. OSBI Totals

Henderson Hills Baptist Church Target Home Depot UPC Acquisition Corp.

Oak Tree Partners LLC

OU Medical Center

Integris Health Edmond

11.7%

0.0%

0.0% 9

0.5% 10

0.7%

0.0%

0.5%

315,726 7,467,074

299,360

442,393

426,035

337,108

394,957

$ 63,703,216

$ $ $

11.7%

0.0%

0.4%

0.7%

0.6%

0.0%

0.7%

0.5%

1.3%

5 9

7,178,982

271,484

411,060 272,404

395,136

406,365

337,554

827,417

2,072,185

2,185,377

$ 61,594,388

$ $

0.0% 0.0% 10.0%

0.0%

0.5% 0.4%

0.5%

0.0%

0.5%

0.4%

1.2%

2.8%

3.2%

5 10 9

6,340,056

339,516 255,308 255,308

315,069

330,251

281,059

759,208

1,754,771

2,049,567

1,693,712

$ 63,667,237

$ $ $

9.4%

0.0%

0.5% 5 0.4% 10 0.0%

0.5% 6

0.5% 8

0.5% 7

0.4% 9

1.2% 4

2.5% 3

2.9% 1

2.7% 2

6,764,067

375,621 278,929

373,020

349,842

363,185

306,271

851,814

1,789,302

2,076,083

1,957,444

$ 71,938,538

$ $

9.5%

0.0%

0.5% 0.4%

0.5%

0.7%

0.5%

0.4%

1.1%

2.5%

2.9%

2.7%

7 10

6,603,297

359,406 276,202

360,258

479,408

342,856

292,138

779,495

1,719,861

1,993,673

1,847,810

$ 69,154,723

$ $

11.7%

0.0%

0.5% 0.4%

0.6%

0.7%

0.5%

1.1%

1.4%

3.1%

2.9%

7 10

389,113 310,054

438,975

511,748

373,712

363,000

806,165

$ 74,756,124

$ 8,739,630

$ $

$ 1,078,747

$ 2,307,101

$ 2,161,015

13.7%

0.0%

0.6% 0.0%

0.0%

0.6%

1.3%

2.3%

2.9%

3.1%

971,947

3.4%

Lowe's

0.6%

2,194,299

3.5%

2.7%

334,632

2,400,975

2,083,285

Edmond YMCA

1.5%

Value

% of Total

737,862

3.4%

Value

% of Total

2014

Homeland Stores

1,539,092

3.8%

3.4%

Value

% of Total

2013

Walmart

1,956,377

2,127,093

Value

2012

Mercy Health

University of Central Oklahoma

Rank

3.3%

Value

% of Total

Rank

1,608,329

Value

% of Total

2011

Rank

City of Edmond

% of Total

2010

Rank

Value

2009

Rank

Edmond Public Schools

Taxpayer

2008

447,974

494,264

452,313

448,296

491,979

833,125

1,046,622

1,825,544

2,265,985

2,437,296

$ 78,135,179

$ 10,743,399

Value

2015

13.7%

0.0%

0.4%

0.5%

0.9%

1.0%

2.4%

3.2%

3.3%

% of Total

291,105

310,761

355,156

379,453

393,246

674,400

811,535

1,851,218

2,480,011

2,577,853

$ 78,135,179

$ 10,124,738

Value

2016

13.0%

0.4%

0.5%

0.9%

1.0%

2.4%

3.2%

3.3%

% of Total

CITY OF EDMOND, OKLAHOMA TOP TEN ELECTRIC CUSTOMERS LAST NINE YEARS TABLE 7

Rank

148

Rate Code 13

Rate Schedule

LIHEAP-1 Low Income Home Energy Assistance Program Rider Customer Charge Energy Charge Summer (Jun-Sept) First 600 kWh Add'l kWh over 600 Winter (Nov-Apr) First 600 kWh Add'l kWh over 600 Summer & Shoulder (May-Oct) * Acceptance requires quaification by DHS prior to annual participation. GS-1 General Service Customer Charge Energy Charge Summer (Jun-Oct) All kWh Winter (Nov-May) First 1000 kWh Add'l kWh over 1000

Shoulder - May First 600 kWh Add'l kWh over 600 Summer (Jun-Sep) First 1,400 kWh Add'l kWh over 1,400 Shoulder - Oct First 600 kWh Add'l kWh over 600 Winter (Nov-Apr) First 600 kWh Add'l kWh over 600

Energy Charge

Customer Charge

R -1 Residential

11.16

0.0993 0.0897 0.0540

$/kWh $/kWh $/kWh

0.0792 0.0444 same as R-1

$/kWh $/kWh $/kWh

$/mo

0.0795 0.0807

0.0792 0.0444

$/kWh $/kWh

0.0792 0.0569

$/kWh $/kWh

2.06

0.0795 0.0807

$/kWh $/kWh

$/mo

0.0792 0.0569

6.05

$/kWh $/kWh

$/mo

Units

Edm Elec 01/01/2007 01/01/2010

0.0865 0.0481

(Continued)

0.1004

30.00

0.0822 0.0468 same as R-2

0.0822 0.0849

3.08

0.0822 0.0468

0.0822 0.0822

0.0822 0.0849

0.0822 0.0822

13.50

Edm Elec 11/01/201311/1/2014

0.0864 0.0480

0.1003

23.04

0.0806 0.0452 same as R-1

0.0806 0.0833

2.06

0.0806 0.0452

0.0806 0.0806

0.0806 0.0833

0.0806 0.0806

12.48

01/01/2010-11/01/13

Edm Elec

(Continued)

0.0886 0.0493

0.1029

30.00

0.0843 0.048 same as R-2

0.0843 0.0870

3.58

0.0843 0.048

0.0843 0.0843

0.0843 0.0870

0.0843 0.0843

14.00

Edm Elec 11/01/201411/1/2015

(Continued)

0.0908 0.0505

0.1055

30.00

0.0851 0.0485 same as R-2

0.0851 0.0957

3.58

0.0851 0.0485

0.0851 0.0851

0.0851 0.0957

0.0851 0.0851

14.00

Edm Elec 11/01/201511/1/2016

CITY OF EDMOND, OKLAHOMA ELECTRICITY RATES LAST NINE YEARS TABLE 8

149

Rate Code 05

PL-TOU Power & Light Time-of-Use Customer Charge TOU Meter Charge (Summer) Capacity Charge Summer Max Billing Demand On-Peak Hrs Demand Winter Max Billing Demand Energy Charge First 1,000,000 kWh All Add'l kWh

Energy Charge First 1,000,000 kWh All Add'l kWh

PL-1 Power & Light Customer Charge Capacity Charge (new 25% ratchet) Summer (Jn-Oct) Winter (Nov-May)

Energy Charge Summer On-Peak Hours (2p-8p) Summer Off-Peak Hours Winter First 1000 kWh Add'l kWh over 1000

Rate Schedule GS-TOU General Service Time-of-Use Customer Charge TOU Meter Charge (Jun-Oct)

69.35 0

1.15 10.19 5.43 0.0395 0.0365

$/mo $/mo

$/kW $/kW $/kW $/kWh $/kWh

0.0395 0.0365

11.34 5.43

$/kW $/kW

$/kWh $/kWh

69.35

$/mo

0.0897 0.0540

$/kWh $/kWh

$/mo $/mo

0.2899 0.0540

11.16 10.23

Units

$/kWh $/kWh

Edm Elec 01/01/2007 01/01/2010

0.0415 0.0383

(Continued)

6.70

1.52 13.5

100.00 0

0.0403 0.0403

13.04 8.00

80.00

0.0865 0.0481

0.3350 0.0481

35.00 0

Edm Elec 11/01/201311/1/2014

0.0415 0.0383

5.70

1.21 10.71

72.00 0

0.0403 0.0403

11.76 6.10

72.00

0.0864 0.0480

0.2880 0.0480

23.04 0

01/01/2010-11/01/13

Edm Elec

(Continued)

0.0423 0.0391

6.77

1.54 13.64

100.00 0

0.0413 0.0413

13.37 8.20

80.00

0.0882 0.0491

0.3434 0.0491

35.00 0

Edm Elec 11/01/201411/1/2015

(Continued)

0.0428 0.0398

6.80

1.58 13.68

100.00 0

0.0423 0.0423

13.7 8.40

80.00

0.0904 0.0503

0.3520 0.0503

35.00 0

Edm Elec 11/01/201511/1/2016

CITY OF EDMOND, OKLAHOMA ELECTRICITY RATES LAST NINE YEARS TABLE 8

150

GPWR

Rate Code 35

0.42 7.81 4.40 0.0402 0.0365

$/mo $/kW $/kW $/kW $/kWh $/kWh

0.0990 0.0897 0.0537

$/kWh $/kWh $/kWh

OAL-1 Outdoor Security Lighting Base Charge 7,000 Mercury Vapor * (71kWh/mo) 9,500 High Pressure Sodium (41kWh/mo) 14,000 Metal Halide - Directional 15,500 High Pressure Sodium 25,000 High Pressure Sodium *Not available for new installations

8.49 6.86 13.91 9.06 12.62

Existing Wood Pole

5.52 5.66 14.37 8.24 11.64

Monthly KWH

0.0009

11.90

$/mo

$/kWh $/kWh $/kWh

147.98

Units

GPWR Green Power Wind Rider (for all standard rates) Wind Selection Charge $/kWh (Customer selects 100% or fixed 100kWh blocks subject to WSC. This WSC rate is added to, and monthly FCA is subtracted from, the standard rate calculation for customer's selected quantity of wind power kWh.)

PS-ND-1 Public Schools Non Demand Customer Charge Energy Charge Summer (Jun-Oct) All kWh Winter (Nov-May) First 1000 kWh Add'l kWh over 1000

Rate Schedule LPL-TOU Large Power & Light Time-of-Use Customer Charge Capacity Charge (new 25% ratchet) Summer (Jun-Oct) mo. Max. Demand On-Peak 2p-8p (except Sun.*) Winter (Nov-May) Energy Charge First 2,000,000 kWh/month All Additional kWh/month * for OG&E summer On-Peak, all weekends and 3 holidays are exempt. On Peak kWh/mo (June 1-Sept 30, 2-7:00 pm) Off-Peak kWh/mo Winter Season: All kWh

Edm Elec 01/01/2007 01/01/2010

8.49 6.86 13.91 9.06 12.62

(Continued)

Monthly KWH

0.0027

0.0874 0.0577

0.1003

50.00

0.1302 0.0325 0.0325

0 0

6.5 0 6.50

600.00

Edm Elec 11/01/201311/1/2014

7.49 5.86 12.91 8.06 11.62

Monthly KWH

0.0027

0.0874 0.0518

0.1003

12.29

0.1150 0.0343 0.0343

0 0

5.21 0 5.21

73.50

01/01/2010-11/01/13

Edm Elec

(Continued)

8.49 6.86 13.91 9.06 12.62

Monthly KWH

0.0027

0.0896 0.0591

0.1028

55.00

0.1328 0.0332 0.0332

0 0

6.63 0 6.63

650.00

Edm Elec 11/01/201411/1/2015

(Continued)

8.49 6.86 13.91 9.06 12.62

Monthly KWH

0.0027

0.0918 0.0606

0.1054

55.00

0.1361 0.034 0.034

0 0

6.79 0 6.79

650.00

Edm Elec 11/01/201511/1/2016

CITY OF EDMOND, OKLAHOMA ELECTRICITY RATES LAST NINE YEARS TABLE 8

151

LM-1

LM-1 Municipal Roadway & Area Lighting Base Charge 7,000 Lumens-MV Lamps *(71kWh/mo) 20,000 Lumens-MV Lamps *(161kWh/mo) 40,000 Lumens-MV Lamps *(272kWh/mo) 9,500 Lumens-High Pressure Sodium (41kWh/mo) 15,500 Lumens-High Pressure Sodium (71kWh/mo) 25,000 Lumens-HPS (Directional) (107kWh/mo) 25,000 Lumens-High Pressure Sodium (107kWh/mo) 14,000 Lumens-HMLamps (Directional) (71kWh/mo)

TSL-LED-1 Traffic Signal Lights Customer Charge Energy Charge Per intersection (250 kWh/mo) OWD-1 Outdoor Warning Device (7-1-08) Customer Charge Energy Charge

OWD

PM-1 Municipal Water Pumping Customer Charge Energy Charge Summer (Jun-Oct) Winter (Nov-May)

Rate Schedule Additional Charges Extension of Secondary Circuit and Wood Pole 30 foot pole 35 foot pole 40 foot pole 45 foot pole 50 foot pole *with wiring requirement of 150 feet or less Underground wiring additional *If pole has to be hand set additional charge Ornamental Lighting Fixtures Base Charge 9,500 High Pressure Sodium on 24 foot fiberglass pole (41 kWh/mo)

Rate Code

19.98

$/mo

5.53 11.11 13.75 5.14 6.54 11.22 10.42 13.02

11.16 n/c

10.2 Monthly KWH 19.98

0.0565 0.0552

$/kW $/kW

12.5 12.5 41

22.84

10.23

18.84 41

1.52 170

0 0.00

$/mo

3.46 354

2.85 4.32 5.1 5.72 6.18

5.37 7.24 8.01 8.97 9.93

5.76 11.62 14.5 4.90 6.82 10.85 9.89 9.50 (Continued)

11.16 n/c

10.2 Monthly KWH 19.98

0.0634 0.0480

23.04

4.37 6.24 7.01 7.97 8.93

01/01/2010-11/01/13

Units

Edm Elec

Edm Elec 01/01/2007 01/01/2010

5.76 11.62 14.5 4.90 6.82 10.85 9.89 9.50 (Continued)

11.16 n/c

10.2 Monthly KWH 19.98

0.0662 0.0500

50.00

22.84 41

0 0

5.37 7.24 8.01 8.97 9.93

Edm Elec 11/01/201311/1/2014

5.76 11.62 14.5 4.90 6.82 10.85 9.89 9.50 (Continued)

11.16 n/c

10.5 Monthly KWH 21.00

0.0679 0.0513

50.00

22.84 41

0 0

5.37 7.24 8.01 8.97 9.93

Edm Elec 11/01/201411/1/2015

5.76 11.62 14.5 4.9 6.82 10.85 9.89 9.5 (Continued)

11.16 n/c

10.5 Monthly KWH 21.00

0.0696 0.0526

50.00

22.84 41

0 0

5.37 7.24 8.01 8.97 9.93

Edm Elec 11/01/201511/1/2016

CITY OF EDMOND, OKLAHOMA ELECTRICITY RATES LAST NINE YEARS TABLE 8

152

Rate Schedule Sign & Underpass Lighting Fixtures 7,000 Mercury Vapor *** (71 kWh/mo) 9,500 High Pressure Sodium (41 kWh/mo) *Not available for new installations **When installed on High Mast Lighting System ***These are available for new installations only as sign lighting Additional Charges Standard Wood Pole Extention of Secondary Circuit and Wood Pole 30 foot pole 35 foot pole 40 foot pole 45 foot pole 50 foot pole *with wiring requirement of 150 feet or less Each additional 5 feet Standard Pole other than Wood 15 to 19 foot 20 to 24 foot 25 to 27 foot 28 to 32 foot 33 to 37 foot 38 to 42 foot 43 to 47 foot Ornamental Type Fixtures *7,000 Lumen MV w 19' Steel Pole (71 kWh/mo) 9,500 HPS w 19' Steel Pole (41 kWh/mo) 20,000 Lumen MV w 24' Steel Pole (161 kWh/mo) 25,000 Lumen HPS w 24' Steel Pole (107 kWh/mo)

Note: Data is presented only for years including and subsequent to implementation of GASB 44. Source: City of Edmond Utility Customer Service Department

Rate Code

Units

5.09 5.47 6.82 7.58 11.52 16.22 21.31 11.96 11.52 19.26 18.82

4.63 4.94 6.19 7.2 10.82 15.45 20.48 10.96 10.57 18.26 17.56

3.17 4.70 5.47 6.14 6.72

2.85 4.32 5.10 5.72 6.18 3.36

7.01 7.01

10.71 8.75

3.25

01/01/2010-11/01/13

Edm Elec

Edm Elec 01/01/2007 01/01/2010

11.96 11.52 19.26 18.82

5.09 5.47 6.82 7.58 11.52 16.22 21.31

3.36

3.17 4.70 5.47 6.14 6.72

7.01 7.01

Edm Elec 11/01/201311/1/2014

11.96 11.52 19.26 18.82

5.09 5.47 6.82 7.58 11.52 16.22 21.31

3.36

3.17 4.70 5.47 6.14 6.72

7.01 7.01

Edm Elec 11/01/201411/1/2015

11.96 11.52 19.26 18.82

5.09 5.47 6.82 7.58 11.52 16.22 21.31

3.36

3.17 4.70 5.47 6.14 6.72

7.01 7.01

Edm Elec 11/01/201511/1/2016

CITY OF EDMOND, OKLAHOMA ELECTRICITY RATES LAST NINE YEARS TABLE 8

153

3.25% 0.00% 4.50% 7.75%

City Oklahoma County State of Oklahoma

Total

2007

7.75%

3.25% 0.00% 4.50%

2008

7.75%

3.25% 0.00% 4.50%

2009

7.75%

3.25% 0.00% 4.50%

2010

7.75%

3.25% 0.00% 4.50%

2011

8.25%

3.75% 0.00% 4.50%

2012

8.25%

3.75% 0.00% 4.50%

2013

8.25%

3.75% 0.00% 4.50%

2014

8.25%

3.75% 0.00% 4.50%

2015

8.25%

3.75% 0.00% 4.50%

2016

CITY OF EDMOND, OKLAHOMA SALES TAX RATES OF DIRECT AND OVERLAPPING GOVERNMENTS Last Ten Fiscal Years TABLE 9

154 $

163,301 352,794 948,339 376,616 256,191 41,369,153

137,266 282,723 1,014,966 400,294 177,054 39,605,879 $

248,418

260,538

33,001

18,522

8,165,460

7,616,216

2,024,068 15,702 480,483 17,679

2,689,076 4,844,080 2,956,101 5,199,041 4,196,902 806,783 1,347,014

2,668,466 4,738,770 2,865,971 4,726,865 4,036,836 758,260 1,282,690

14,693

2,966,272

3,106,444

1,948,510 15,648 407,089 16,400

8,430,100

395,719

286,862

192,498 43,938,901

163,467 308,276 891,543 392,206

259,991

2,115,513 12,369 533,356 23,696

2,669,621 5,048,412 3,217,337 5,296,659 4,408,032 796,361 1,407,880

4,257,938

318,134

98,379 64,906 2,962,614 36,612

55,375 29,076 2,787,641 28,500

(112,697) 62,285 2,854,686 39,045

2009

2008

2007

323,703 41,463,130

155,084 285,609 786,322 401,687

248,369

2,107,808 9,858 493,928 22,068

59,514

8,427,080

2,394,461 4,676,327 3,391,516 5,306,478 4,515,923 852,484 1,495,670

2,311,014

213,983

42,304 1,736 2,904,097 36,107

2010

530,895 42,987,561

148,431 304,701 804,873 459,313

255,986

2,063,197 7,492 489,984 25,167

69,007

8,509,668

2,584,712 4,417,446 3,801,497 5,613,523 4,697,973 997,628 1,522,093

2,554,821

211,016

31,739 46,492 2,807,077 32,830

2011

677,950 47,925,677

117,573 358,175 929,140 472,940

272,925

2,116,694 11,467 633,883 25,149

62,873

8,974,710

3,105,063 4,967,601 4,475,165 6,193,801 5,197,419 1,085,814 1,631,106

3,149,901

303,993

56,292 66,585 2,969,951 69,507

2012

448,675 476,835 7,718,137 692,889 (13) (20,517) 58,761,128

23,351

764,894 611,217 7,092,658 702,250 (139) 667,328 61,376,116

21,599

214,533 1,094,582 2,972,839 7,228,993 5,680,279 838,136 1,391,971 477,195 2,135,798 1,721,282 12,471,298 2,145,195 179,183 26,904 2,149,341 108,285 951,448 282,425 33,548 36,647

179,414 1,180,533 3,667,788 7,274,378 5,730,617 917,293 1,447,945 316,627 2,213,029 1,751,700 11,359,340 1,975,995 168,612 19,378 2,267,040 51,315 950,089 440,391 39,309 42,272

708,417 2,229,790 228,999 111,759

631,941 1,918,186 224,288 119,956

28,889 6,252 3,609,167 75,608 254,580 1,170,308 568,332 69,034 115,615 199,677

2014

20,050 5,204 2,185,463 50,217 110,738 1,075,374 759,798 62,456 49,323 215,711

2013*

865,127 1,410,566 6,901,495 707,734 138 429,028 63,464,669

15,736

204,729 1,208,563 3,660,727 6,395,382 6,175,940 902,803 1,352,040 640,540 2,138,160 1,777,882 13,097,434 2,054,285 337,113 20,387 2,185,157 23,316 957,366 227,880 40,869 42,600

2,171,456 346,309 113,885

643,930

30,001 4,025 3,844,159 70,085 261,041 1,260,151 568,108 89,854 55,968 232,700

2015

1,009,240 903,853 7,565,202 793,278 562,687 64,162,993

15,840

186,588 1,310,926 3,241,497 6,613,579 6,197,197 982,101 1,529,810 577,858 2,099,602 1,674,319 13,351,178 1,991,553 25,110 15,928 2,128,055 24,089 1,109,411 161,879 62,411 23,418

2,062,887 377,292 125,520

658,976

60,000 23,069 4,303,732 93,837 170,026 1,241,830 472,631 57,888 52,671 306,025

2016

LAST TEN FISCAL YEARS TABLE 10

(1) The source for taxable sales by category is the Oklahoma Tax Commission. This amount is the gross amount before the State retains portion for revolving fund. Note: in FY 2013, the Oklahoma Tax Commission changed their SIC codes and now use NAICS codes. These new codes have more categories than in previous years. We matched previous years as best that we could to match to the new codes descriptions.

Agri, forestry, fishing hunting Mining, oil and gas extraction Utilities Construction Mfg‐foods, textile, tobacco Mfg‐building, books, glass, brick, concrete Mfg‐iron,steel,sign,construction equipment, hardware Wholesale trade‐Automobiles, tires Wholesale trade‐Furniture, home furnishings Wholesale trade‐Lumber, brick, roofing, siding Wholesale trade‐Office & medical equipment, hardware, electrical appliances Wholesale trade‐Heat & Air, plumbing, farm, garden, transportation, industrial equipment Wholesale trade‐Sporting goods, office supplies, drugs, apparel Wholesale trade‐Grocery, meat, fish, fruit, dairy Wholesale trade‐Chemical, plastics, paint, books, florists, farm supplies Retail trade‐cars, boats, tire, parts Retail trade‐furn, household, computer, cameras Retail trade‐hardware, building materials, paint, nursery Retail trade‐grocery Retail trade‐wine, beer, liquor stores Retail trade‐health, pharmacies, Retail trade‐gasoline with conv. Stores Retail trade‐clothing, shoes, jewelry Retail trade‐sporting goods, hobby, sewing, musical Retail trade‐dept stores, gen merchandise Retail trade‐florist, office supplies, pet, art, vending, used merch. Transportation and warehousing‐towing, freight, trucking Transportation and warehousing‐warehousing and storage Information‐newspaper, cable, wireless Finance and insurance Real estate and rental and leasing Professional, scientific, and technical services Adm. & support and waste mangement and remediation services Educational services Health care and social assistance‐doctors, chiropractors, eye, family services Arts, Entertainment, and Recreation‐golf, fitness, bowling, museums Accommodation and Food Services ‐Hotels Accommodation and Food Services ‐Restaurants, Bars Other Services (Auto, Electronic repairs, Salons, funeral Public Administration‐Regulation of Transportation Programs Unclassified

CITY OF EDMOND, OKLAHOMA TAXABLE SALES BY CATEGORY

155

62,153,107 55,788,256

2015

2016

37,895,094 30,443,608 28,716,894

42,400,000

46,625,000

50,695,000

54,590,000

58,685,000

62,620,000

66,060,000

14,999,365

16,275,467

17,521,569

17,891,382

19,010,890

20,096,707

21,156,506

22,186,681

23,188,242

24,130,636

50,761

50,665

123,383

Business-Type Activities Revenue Captial Bonds Notes Leases Payable Payable Payable

* Population is calculated at calender year end prior to fiscal year. See Table 16

67,821,392

2014

66,845,000

2011

73,260,000

69,390,000

2010

2013

72,985,000

2009

62,750,000

76,430,000

2008

2012

79,755,000

2007

Governmental Activities Revenue Capital Fiscal Bonds Leases Year Payable Payable

99,504,515

108,872,182

123,238,055

133,551,382

128,385,890

137,636,707

145,136,506

153,907,442

162,288,907

170,069,019

Total Primary Government

2.91%

3.18%

3.79%

3.97%

3.96%

5.07%

5.13%

6.70%

7.06%

7.40%

% of Personal Income

1,132

1,239

1,447

1,582

1,536

1,691

1,783

1,911

2,047

2,182

Total Debt Per Capita*

CITY OF EDMOND, OKLAHOMA RATIO FOR OUTSTANDING DEBT BY TYPE Last Ten Fiscal Years TABLE 11

156

89,065

2016

(6) (7)

(4) (5)

961,313,411

902,595,017

854,180,987

824,050,837

806,652,399

786,787,845

762,213,816

716,953,613

603,055,867

(7) 1,017,637,106

(7)

(6)

(5)

(4)

(3)

Gross Bonded Debt

Net Bonded Debt

Details regarding the city's outstanding debt can be found in the notes to the financial statements. Oklahoma County Assessor's Report 2014 Oklahoma Department of Commerce Projection 2000 Census City of Edmond GIS Department, based on 2000 Census Avg HH Size for Years 2001-2004 , and the 2007 ACS Avg HH Size for Years 2005-2007 with Occupancy Rate City of Edmond GIS Department, estimate only based on current Building Permits for 2008 City of Edmond, GIS/Planning Department 2001-2010 Based on the Amercian Community Survey Avg HH, and Building Permits since 2000 Census 2010 Census City of Edmond Planning Department, estimate based on the 2010 Census, current Building Permits, the Edmond Economic Development Authority Average House Hold (HH) size, and the American Community Survey Occupancy Rate

87,877

2015

Note: * (1) (2) (3)

85,190

81,405

2011

2014

81,395

2010

84,404

80,535

2009

2013

80,364

2008

83,591

79,270

2007

2012

Population

Fiscal Year

Net * Assessed Value

Less Debt Service Funds

0.00%

Ratio of Net Bonded Debt to Assessed Value

Net Bonded Debt Per Capita

CITY OF EDMOND, OKLAHOMA RATIO OF NET GENERAL BONDED DEBT TO ASSESSED VALUE AND NET BONDED DEBT PER CAPITA Last Ten Fiscal Years TABLE 12

157

55,788,256

$251,288,814

47,175,558

$ 148,325,000

14.38%

57.25%

100.00%

Percentage (2) Applicable to City of Edmond

$147,486,669

6,785,014

84,913,399

$55,788,256

Amount Applicable to City of Edmond

(2) Determined by ratio of assessed valuation of property subject to taxation in overlapping unit to valuation of property subject to taxation in the City of Edmond.

(1) City of Edmond does not have any GO Bonds. Amount shown is direct debt for governmental activities.

Total

Oklahoma County

Overlapping: Edmond School District

Direct - City of Edmond

Jurisdiction

Net (1) Debt Outstanding

CITY OF EDMOND, OKLAHOMA COMPUTATION OF DIRECT AND OVERLAPPING DEBT June 30, 2016 TABLE 13

158

0.00%

6,305,587

0.00%

$ 71,695,361

2008

0.00%

$ 85,418,099

2013

0.00%

$ 96,131,341

2015

0.00%

$ 1,017,637,106

2016

Legal Debt Margin Calculation for Fiscal Year 2016

0.00%

$ 90,259,502

2014

101,763,711

0.00%

$ 82,405,084

2012

Debt limit (10% of total assess value) Debt applicable to limit: General obligation bonds Less: Street bonds outstanding Total net debt applicable to limit Legal debt margin

0.00%

$ 80,665,240

2011

$ 1,017,637,106

0.00%

$ 78,678,785

2010

Net assessed valuation

0.00%

$ 76,221,382

2009

Note: Article 10, Section 26 of the Constitution of the State of Oklahoma limits municipal debt to 10% of net assessed valauation. Article 10, Section 27 of the Constitution of the State of Oklahoma limits municipal debt to non-utility or non-street purposes.

Total net debt applicable to the limit as a percentage of debt limit

Legal debt margin

Total net debt applicable to limit

Debt limit

2007

CITY OF EDMOND, OKLAHOMA LEGAL DEBT MARGIN INFORMATION Last Ten Fiscal Years TABLE 14

159 124,463,512 144,078,716 144,078,716 131,616,376 152,179,138 152,179,138 143,118,338 164,070,328 164,070,328 138,403,411 138,403,411 138,403,411

2013 Sales Tax and Utility Revenue Bonds Series 2004, 2005, 2010, 2012, 2013 Utility Revenue Bonds Series 2003, 2004, 2005 OWRB Series 2005, 2006

2014 Sales Tax and Utility Revenue Bonds Series 2005, 2010, 2012, 2013, 2014 Utility Revenue Bonds Series 2005, 2014 OWRB Series 2005C, 2013 General Sales Revenue Note

2015 Sales Tax and Utility Revenue Bonds Series 2010, 2012, 2013, 2014 and 2014B Utility Revenue Bonds Series 2014 and 2015 OWRB Series 2005C, 2013 General Sales Revenue Note

2016 Sales Tax and Utility Revenue Bonds Series 2010, 2012, 2013, 2014 and 2014B Utility Revenue Bonds Series 2014 and 2015 OWRB Series 2005C, 2013 General Sales Revenue Note

Excludes depreciation and amortization expense.

111,304,738 127,646,147 127,646,147

2012 Sales Tax and Utility Revenue Bonds Series 2001, 2003, 2004, 2005, 2010 Utility Revenue Bonds Series 1998, 1999, 2003, 2004, 2005 OWRB Series 2005, 2006

111,304,738 127,646,147 127,646,147

2011 Sales Tax and Utility Revenue Bonds Series 2001, 2003, 2004, 2005 Utility Revenue Bonds Series 1998, 1999, 2003, 2004, 2005 OWRB Series 2005, 2006

106,361,912 123,109,588 123,109,588

2009 Sales Tax and Utility Revenue Bonds Series 2001, 2003, 2004, 2005 Utility Revenue Bonds Series 1998, 1999, 2003, 2004, 2005 OWRB Series 2005, 2006 102,344,442 118,119,652 118,119,652

98,908,461 114,558,163 114,558,163

2008 Sales Tax and Utility Revenue Bonds Series 2001, 2003, 2004, 2005 Utility Revenue Bonds Series 1998, 1999, 2003, 2004, 2005 OWRB Series 2005, 2006

2010 Sales Tax and Utility Revenue Bonds Series 2001, 2003, 2004, 2005 Utility Revenue Bonds Series 1998, 1999, 2003, 2004, 2005 OWRB Series 2005, 2006

99,735,661 114,845,407 114,845,407

2007 Sales Tax and Utility Revenue Bonds Series 2001, 2003, 2004, 2005 Utility Revenue Bonds Series 1998, 1999, 2003, 2004, 2005 OWRB Series 2005, 2006

Revenues

Eligible

103,214,885 94,663,331 94,663,331

125,701,219 97,069,562 97,069,562

115,686,623 94,999,819 94,999,819

109,885,068 90,796,258 90,795,258

91,610,054 83,031,312 83,031,312

81,867,810 74,845,596 74,845,596

81,058,262 74,052,201 74,052,201

79,729,807 72,725,121 72,725,121

79,826,395 72,731,962 72,731,962

Eligible 1 Expenses

35,188,526 43,740,080 43,740,080

17,417,119 67,000,766 67,000,766

14,578,444 53,282,458 53,282,458

19,694,684 44,614,835 44,614,835

20,476,632 43,274,056 43,274,056

25,303,650 49,057,387 49,057,387

19,178,654 41,833,042 41,833,042

7,455,266 6,594,274 6,594,274

7,455,266 6,954,274 6,954,274

8,552,264 8,399,737 8,399,737

8,552,264 8,443,233 8,443,233

6,990,269 8,443,233 8,443,233

6,822,981 8,682,517 8,682,517

6,822,981 8,443,233 8,443,233

6,882,981 8,443,233 8,443,233

6,822,981 8,443,233 8,443,233

Debt Service

Debt Service 19,909,266 42,113,445 42,113,445

Maximum Annual

Net Revenue Available for

4.72 6.63 6.63

2.34 9.63 9.63

1.70 6.34 6.34

1.70 6.31 6.31

2.82 5.28 5.28

3.00 4.98 4.98

3.71 5.81 5.81

2.79 4.95 4.95

2.92 4.99 4.99

Coverage

Revenue Bond

CITY OF EDMOND, OKLAHOMA THE EDMOND PUBLIC WORKS AUTHORITY UTILITY SYSTEMS DIVISION Last Ten Fiscal Years TABLE 15

160

79,270

80,535

81,395

81,405 *

83,591

84,404

85,190

87,877

88,067

2007

2008

2009

2010

2011

2012

2013

2014

2015

3,715,132,785

3,424,303,059

3,247,783,560

3,360,292,048

3,242,745,663

2,713,228,650

2,828,232,065

2,670,460,065

2,522,054,320

2,335,328,310

40,495

38,967

38,124

39,812

38,793

33,330

34,747

33,159

31,816

29,967

Per Capita Personal Income

(5) Edmond Economic Development Authority (EEDA). Information for previous years not available.

(4) www.bls.gov

(3) Edmond School District

(2) Edmond Economic Development Authority (EEDA)

35.7

34.9

35.0

35.2

34.2

35.0

34.9

34.7

34.8

34.6

Median Age of Population (2)

Sources: (1) City of Edmond, GIS/Planning Department 2001-2011 Based on the American Community Survey Avg HH, and Building Permits to date * Based on 2010 Census Bureau data

Note: Information was unavailable for the cells with N/A .

77,930

Population (1)*

2006

Calendar Year

Personal Income (in thousands) (2)

51.2

49.4

46.5

46.6

47.3

50.1

51.4

48.6

N/A

Percent with College Degree or Higher (5)

24,407

23,965

23,484

23,089

22,472

21,960

21,358

20,786

20,272

19,726

School Enrollment (3)

4.4%

3.5%

3.7%

4.4%

4.0%

4.2%

4.8%

4.6%

4.3%

3.9%

Unemployment Rate (4)

CITY OF EDMOND, OKLAHOMA DEMOGRAPHIC AND ECONOMIC STATISTICS Last Ten Calendar Years TABLE 16

161

Hospital Electronic Distribution

INTEGRIS Health Edmond

Petra Industries

Surgical Treatment Center Auto Parts Manufacturing Traffic, Decorative, & Utility Hardware Food Distribution Communication Services

Summit Medical Center

Remy International2

Pelco Products

Ben E. KeithÂł

Cox Communications

5,565

147

250

107

430

350

250

189

642

1,009

2,191

Rank Employees

100%

2.6%

4.5%

1.9%

7.7%

6.3%

4.5%

3.4%

11.5%

18.1%

39.4%

% of Total

Rank

7,080

225

252

255

356

362

367

444

700

1,372

2,747

Employees

2016

100%

3.2%

3.6%

5.0%

5.1%

5.2%

6.3%

9.9%

19.4%

38.8%

% of Total

Formerly Edmond Medical Center Formerly Unit Parts 3* Ben E. Keith is located out of City of Edmond limits but was included in 2006 data, this company is still in business, we are only including those within the City limit

Source: Edmond Economic Development Authority

Totals

Clinic and Wellness Center

Hospital

Mercy Edmond I-35

OU Medical Center

Local Municipality

City of Edmond

Quality Control for Mortgage Industry

Higher Education

University of Central Oklahoma

Adfitech

Public Education

Product/Business

Edmond Public Schools

Employer

2006

CITY OF EDMOND, OKLHAOMA PRINCIPAL EMPLOYERS Current and Ten Years Ago TABLE 17

CITY OF EDMOND, OKLAHOMA FULL-TIME EQUIVALENT BUDGETED CITY GOVERNMENT EMPLOYEES BY FUNCTION/PROGRAM Last Ten Fiscal Years TABLE 18

Fiscal

Fiscal Fiscal Fiscal Fiscal Fiscal Year Year 2012 2013 2014 2015 2016

2007

2008

2009

2010

2011

6 4 7 2 6 16 7 22 14 6 1 15 7 2 2 117

5 4 8 2 7 16 8 22 14 6 1 15 7 2 2 119

5 4 8 2 7 16 8 24 14 6 1 15 7 2 2 121

5 4 8 2 7 16 8 26 14 6 1 15 5 2 2 121

4 4 8 2 7 16 8 26 14 6 1 15 5 2 2 120

5 4 8 2 7 16 8 26 14 6 1 15 5 2 2 121

5 4 8 2 7 16 8 30 14 7 1 15 6 2 1 126

5 2 8 1 6 17 8 32 17 7 1 15 6 2 1 128

5 2 8 1 5 17 7 32 18 7 1 16 9 3 1 132

6 2 8 1 5 17 6 32 18 7 1 16 10 3 1 133

111 20 10

114 22 10

114 23 9

123 25 9

120 30 7

111 5 2 21 8 288

114 6 2 24 8 300

114 7 2 24 8 301

115 7 2 24 8 302

115 10 2 24 8 305

117 5 2 24 8 313

117 5 2 24 7 312

25 5 12 42

25 5 14 44

25 5 12 42

25 5 13 43

25 6 12 43

25 7 11 43

44 44

40 40

41 41

42 42

Utilities: Electric Water Solid Waste Wastewater Drainage Utility Customer Service Central Warehousing Total Public Works

47 42 21 19 5 36 0 170

48 43 21 21 5 38 0 176

48 42 21 21 5 38 3 178

48 42 21 22 5 38 3 179

49 42 20 22 5 38 3 179

49 42 20 22 5 39 3 180

49 42 20 24 5 39 3 182

50 44 20 22 5 42 3 186

50 44 19 26 5 43 3 190

Total Full-Time Budgeted Employees by Function/Program

661

679

685

686

685

686

693

700

716

720

Function/Program General Government: Managament Services City Clerk/Governmental Relations Finance Treasurer Human Resources IT Legal Other Engineering Planning CDBG Building Community Image Convention & Visitors Bureau Downtown Community Center Total General Government Public Safety and Judiciary: Police: Officers Civilians Animal Welfare Fire: Firefighters & Officers Civilians Emergency Management Central Communications/EM Municipal court Total Public Safety and Judiciary Transportation: Streets Traffic Public Works Administration Cultural, Parks and Recreation: Parks and Recreations Total Cultural, Parks and Recreation

Other includes, Urban Forestry, Vehicle Maintenance, Marketing and Facility Maintenance Source: City of Edmond Human Resource Dept. NOTE: Data is presented only for years including and subsequent to issuance of GASB 44

162

CITY OF EDMOND, OKLAHOMA Capital Asset Statistics by Function/Program Last Ten Fiscal Years TABLE 19

FY 2007 FY 2008

FY 2009

FY 2010

FY 2011

FY 2012 FY 2013

FY 2014

FY 2015

FY 2016

Function/Program Police: Stations Patrol units Fire : Stations Engines Quint Vehicles Refuse Collection: Collection trucks Streets: Street miles1 Streetlights Traffic signals Parks and Recreation: Acreage Playgrounds Baseball/softball diamonds Soccer/football fields Community Center Pool Golf course Disc Golf courses Splash Pad Public Transportation:2 Buses Trolley Cemetery: Plots Maintained3 Vehicles & Machinery Water: Water mains (miles) Fire hydrants Storage capacity (thousands of gallons) Clearwells and Tower Arcadia Lake Wastewater: Sanitary sewers (miles) Force Main Sanitary sewers (miles) Gravity Main Storm sewers (miles) Treatment capacity (thousands of gallons)

1 124

1 126

1 138

1 139

1 144

1 147

1 148

1 152

5 6 1 25

5 6 1 26

5 6 1 29

5 5 2 29

5 5 2 35

5 5 2 44

610 4,162 82

618 4,458 91

625 4,463 95

627 4,954 96

627 5,421 99

487 5,542 99

487 5,652 99

494 6,123 99

484* 6,190 100

485 6,339 99

4,821 22 24 13 1 1 1 3

4,949 23 24 13 1 1 1 3

4,960 23 24 16 1 1 1 3

4,960 23 31 16 1 1 1 3 1

3 3

8 -

12 0

15,165 3

15,165 4

15,599 4

15,654 4

463 3,882

474 3,982

480 4,092

484 4,129

493 4,315

500 4,392

502 4,388

507 4,473

516 4659

523 4827

20,000 11,000

22 399 95 9,000

22 407 100 9,000

22 431 128 9,000

22 438 133 9,000

22 413 105 9,000

22 416 107 9,000

8 0

22 416 111 9,000

20,000 11,000 22 423 115 9,000

20,000 11,000 22 424 118 9,000

20,000 11,000 22 429 118 9,000

Source: City of Edmond Departments (1) Street miles included private roads for years prior to 2012 (2) Edmond's Public Transportation began July, 1, 2009, COTPA owns the buses, Edmond maintains them (3) Amounts have been restated to reflect number of plots maintained * GIS dept updated their way of tracking mileage and counted 1 side of street rather than both sides on a few unmarked streets

163

164

Transit

Wastewater

Water

Parks & Recreation

Other Public Works

Citylink Bus Service-Revenue Mileage Total Route Miles-Trolleys and Broncho2 Passengers3

Average Daily Sewage Treatment (Millions of Gallons)

New Water Connections Water Main Breaks Average Daily Produced (Thousands of Gallons) Peak Daily Produced (Thousands of Gallons)

Community Center-MAC Program Participants MAC-Special Event Participants1 (MAC-Multi-Use Activity Center) Classes⁴ Senior Center-Program Participants -Sr. Center Lunch Program

Athletic Field-Agreements EASI (# of Fields Used) Edmond Soccer Club (# of Fields Used) Miracle League of Edmond (# of Fields Used) YMCA (# of Fields Used) Edmond Round Up Arena Edmond Rugby Club (# of Fields Used) Edmond Lacrosse Club (# of Fields Used) B & B Tennis (# of Courts Used)

Potholes Repaired: Asphalt Patching (Tons) Concrete Patching (Cubic Yards) Asphalt Repairs (Tons) Concrete Repairs (Cubic Yards)

Solid Waste Collected (Tons Per Day) Recyclables Collected (Tons Per Day)

0 261,033 69,622

0 268,759 61,089

7,300

19,950

21,950

7,000

412 60 10,130

69,361 19,726

48,369 22,471 942 97 10,230

844 10,381

20 13 1 7 1 2 5 14

261 91 4,741 477

258 12

5,020 210 883

19,815

2,364 1,086

2008

1,940 n/a

20 13 1 7 1

309 171 1,728 303

238 11

4,518 330 1,080

19,965

Traffic Violations Emergency Responses Fires Extinguished Inspections

2,683 1,533

Physical Arrests Parking Violations

2007

2008, tracking of Progams and Special Events are being tracked separately Source: Various City Departments 2 Transit information provided by Metro Transit 2006-2009 3 Transit Information provided by McDonald Transit & Associates 2010, Edmond's Transit began July 1, 2009 ⁴Starting with 2014, Class participation has its own category instead of being merged with programs as in the past.

Fire

Police

Solid Waste Collection

Function/Program

0 269,059 66,033

6,850

21,910

264 44 10,340

68,034 17,080

1,120 5,419

20 13 1 7 1 2 5 14

345 106 2,364 433

259 11

5,692 260 1,191

18,821

2,071 1,643

2009

228,920 109,000

7,180

22,078

283 57 9,440

60,181 11,266

2,309 6,500

20 16 1 7 1 2 5 14

255 160 2,793 554

255 11

5,745 238 1,057

17,409

2,543 1,462

2010

220,219 179,220

6,900

21,177

330 73 10,709

38,772 9,486

6,525 4,086

20 16 1 7 1 2 5 14

218 117 2,183 510

262 10

5,890 214 937

17,480

2,658 1,547

2011

279,388 235,005

7,400

21,906

491 45 11,409

42,240 9,669

2,332 3,338

20 16 1 7 1 2 4 14

385 140 446 203

242 8

6,793 304 1,096

14,196

2,728 1,230

2012

283,188 265,000

7,000

22,097

598 58 10,712

42,753 9,541

4,332 4,034

20 16 1 7 1 2 4 14

214 128 1,105 298

218 8

5,984 223 904

14,151

2,931 984

2013

283,175 277,475

7,300

19,815

539 53 9,704

1,570 2,348 3,394 45,256 8,618

20 16 1 7 1 2 4 14

320 89 689 281

241 18

6,810 202 1,062

13,311

2,336 747

2014

271,341 290,939

7,300

18,400

589 48 10,400

1,864 915 7,058 48,545 9,686

20 16 1 7 1 2 4 14

279 73 619 400

223 24

7,375 232 3,144

10,751

2,220 1,008

2015

266,060 274,074

7,680

19,889

552 51 11,497

4,596 5,756 1,032 51,091 9,803

20 16 1 7 1 2 4 14

370 432 714 307

196 17

8,101 259 1,577

11,152

2,527 1,063

2016

CITY OF EDMOND, OKLAHOMA Operating Indicators by Function/Program Last Ten Fiscal Years TABLE 20

165

501 601 561 638 506 337 289 218 444 453

175,957,069 192,714,809 174,720,033 193,540,218 147,731,866 68,660,592 75,872,141 68,660,592 144,263,081 144,963,081

Construction Cost

Source: City of Edmond Public Works Department Fiscal building permit reports

2016 2015 2014 2013 2012 2011 2010 2009 2008 2007

Number of Permits

Residential Construction

Commercial

Residential

2016 2015 2014 2013 2012 2011 2010 2009 2008 2007

Fiscal year

20,000,000

40,000,000

60,000,000

80,000,000

100,000,000

120,000,000

140,000,000

160,000,000

180,000,000

200,000,000

5 6 Years

68 45 39 33 64 41 13 40 77 81

Number of Permits

90,524,820 68,355,573 78,136,825 41,123,830 181,906,271 30,497,140 58,412,750 39,639,775 74,341,194 50,307,822

Construction Cost

Commercial Construction

Construction Cost by Fiscal Year

Building Permit by Fiscal Year

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Fiscal year

100

200

300

400

500

600

700

Construction Costs

Number of Permits

Commercial

Residential

CITY OF EDMOND, OKLAHOMA CONSTRUCTION PERMITS Last Ten Fiscal Years TABLE 21