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Richmond County Board of Education

Hamlet, North Carolina

and the Finance Department

Comprehensive Annual

Financial Report

For the Fiscal Year Ended

June 30, 2018

Prepared by

Tina Edmonds

RICHMOND COUNTY BOARD OF EDUCATION TABLE OF CONTENTS

INTRODUCTORY SECTION Letter of Transmittal i Board Members and Principal Officers iv Organizational Chart v Certificate of Excellence in Financial Reporting – ASBO vi

FINANCIAL SECTION Exhibit Page No. Independent Auditors’ Report ........................................................................................... 1 Management’s Discussion and Analysis .......................................................................... 3 Basic Financial Statements: Government-wide Financial Statements: 1 Statement of Net Position ........................................................................................... 10 2 Statement of Activities ................................................................................................ 11 Fund Financial Statements: 3 Balance Sheet - Governmental Funds ....................................................................... 12 4 Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds ............................................................................................... 14 5 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities ............... 15 6 Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - General Fund and Annually Budgeted Major Special Revenue Funds........................................................................................... 16 7 Statement of Net Position - Proprietary Fund Type .................................................... 20 8 Statement of Revenues, Expenses, and Changes in Fund Net Position - Proprietary Fund Type ............................................................................................. 21 9 Statement of Cash Flows - Proprietary Fund Type ..................................................... 22 Notes to the Financial Statements ................................................................................. 24

Required Supplementary Information: Schedule of the Board’s Proportionate Share of the Net Pension Liability – Teachers’ and State Employees’ Retirement System ............................................. 47 Schedule of Board Contributions – Teachers’ and State Employees’ Retirement System ............................................. 48 Schedule of the Board’s Proportionate Share of the Net OPEB Liability – Retiree Health Benefit Fund .................................................................................... 49 Schedule of Board Contributions – Retiree Health Benefit Fund .................................................................................... 50 Schedule of the Board’s Proportionate Share of the Net OPEB Asset – Disability Income Plan of North Carolina ................................................................. 51 Schedule of Board Contributions – Disability Income Plan of North Carolina ................................................................. 52 Individual Fund Budgetary Schedules: Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - General Fund .......................................................................... 54 Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - Capital Outlay Fund................................................................. 56 Schedule of Revenues and Expenditures - Budget and Actual (Non-GAAP) School Food Service Fund ...................................................................................... 57

RICHMOND COUNTY BOARD OF EDUCATION TABLE OF CONTENTS (continued)

STATISTICAL SECTION Table Page No.

1 Financial Perspective for Governmental and Business-type Activities ............................ 61 2 Net Position by Component .............................................................................................. 62 3 Changes in Net Position ................................................................................................... 64

4 Governmental Funds – Fund Balances ............................................................................ 66 5 Governmental Funds – Changes in Fund Balances ........................................................ 68 6 Operational Expenditures Per Pupil – Expenditures by Function ..................................... 70 7 Proprietary Fund – Food Services Operations – Revenues by Source ............................ 72 8 Proprietary Fund – Food Services Operations – Expenses by Category ......................... 74 9 Ratios of Outstanding Debt by Type ................................................................................ 76 10 Average Daily Membership .............................................................................................. 77 11 Student Statistics .............................................................................................................. 78 12 Full-time Equivalent Governmental Employees by Function/Program ............................. 80 13 Instructional Personnel ..................................................................................................... 81 14 School Building Data ........................................................................................................ 82 Richmond County, North Carolina 15 Demographic Statistics ................................................................................................. 83 16 Principal Employers ...................................................................................................... 84 17 Ratios of Outstanding Debt by Type ............................................................................. 85 18 Principal Property Taxpayers ........................................................................................ 86 19 Property Tax Levies and Current Collections ............................................................... 87

Introductory Section

i

Richmond County Schools

118 Vance Street

Hamlet, North Carolina 28345

Telephone: (910) 582-5860 • Fax: (910) 582-7921

November 28, 2018 Members of the Richmond County Board of Education and Citizens of Richmond County, North Carolina: In compliance with the Public School Laws of North Carolina, the Comprehensive Annual Financial Report of the Richmond County Board of Education, operating as “Richmond County Schools”, for the fiscal year ended June 30, 2018, is herewith submitted. Responsibility for accuracy, completeness, and clarity of the report rests with the Superintendent and Finance Officer. The report has been prepared by the Finance Department in accordance with generally accepted accounting principles. We believe the data presented is accurate in all material respects and that it is presented in a manner designed to fairly reflect the financial position and results of operations of the Board. All disclosures necessary to enable the reader to gain an understanding of the Board’s financial activity have been included. This letter of transmittal is designed to complement Management’s Discussion and Analysis (MD&A) and should be read in conjunction with it. The MD&A can be found immediately following the report of the independent auditors. REPORTING ENTITY The Richmond County Board of Education (Board) is the level of government having oversight responsibility and control over activities related to public school education in Richmond County, North Carolina. For the 2017-2018 fiscal year, the school system served approximately 7,200 students from kindergarten through 12th grade in 7 elementary schools, 4 middle schools, and 4 secondary schools. The school system provides general, special and vocational education services. The school system receives local, State, and federal government funding and must comply with the legal requirements of each funding source entity. While the Board does receive county funding, the county is not entitled to share in any surplus nor is it required to finance any deficits. The Board, whose members are elected by the citizens of Richmond County, has the authority to designate management, make binding decisions, and significantly influence operations. However, the Board has no tax levying or borrowing authority and is required to maintain accounting records in a uniform State format. The Board has final approval over the budget and primary accountability for fiscal matters. Accordingly, the Richmond County Board of Education is not included in any other reporting entity. FINANCIAL AND BUDGETARY CONTROL In order to meet the challenging learning experiences provided to the students attending Richmond County Schools, the Board must use a variety of funding resources, including local, State, federal and private grants while complying with legal requirements of each funding source entity. In doing so, the Board is unable to summarize all governmental financial transactions and balances in one accounting entity. Instead, the accounting system is divided into two separate entities; each referred to as a “fund”. The Board’s funds are divided into governmental and proprietary. Each fund is a self-balancing set of accounts, which are segregated for the purpose of carrying on specific activities in accordance with legal

Letter of Transmittal (continued)

ii

requirements, generally accepted accounting principles, special regulations or other limitations. Governmental fund types include general, special revenue and capital projects. The enterprise fund is a proprietary fund type. The enterprise fund is presented on a full accrual basis, while the other funds are maintained on a modified accrual basis. Internal accounting controls are given consideration in developing and improving the Board’s accounting system. Internal controls are designed to provide reliability of financial records for preparing financial statements and maintaining accountability for assets. The cost of a control should not exceed the benefits derived, therefore, the objective is to provide reasonable, rather than absolute assurance, that the financial statements are free of any material misstatements. We believe that the Board’s internal accounting controls adequately safeguard assets and provide reasonable assurance of proper recording of financial transactions. North Carolina General Statues requires all governmental units in the state to adopt a balanced budget by July 1 of each year. The Board has the final approval over the budget and primary accountability for fiscal matters (including any deficits). Annual budgets are adopted for all funds, except for the individual schools special revenue funds, as required by the North Carolina General Statutes. No budget is required by State law for individual school funds. The Board’s annual Budget Resolution authorizes expenditures by purpose on a modified accrual basis. For internal management purposes, the budget is detailed and compared to expenditures and encumbrances by line item within each function and project. The budget amounts reflected in the accompanying financial statements represent the final budgets as amended for the fiscal year. The Board also uses a purchase order encumbrance system that records and shows encumbrances outstanding against each line item of expenditures. Outstanding encumbrances at the end of the fiscal year related to normal operations are cancelled and renewed in the following fiscal year.

ECONOMIC CONDITION AND OUTLOOK Richmond County is dedicated to providing a strong and capable workforce for employers. In December 2017 Richmond County announced that Plastek, a Pennsylvania-based maker of packaging for hygiene products, will expand their existing Hamlet site, which will serve its growing East Coast market. The company plans to invest over $4.2 million in the present facility, which will add 63 additional workers. The success we are experiencing in our job growth efforts is the result of a strong spirit of collaboration that exists in Richmond County; to create an industry friendly environment which fosters growth within our county. Richmond County has a population of approximately 45,000 with very little growth experienced over the past ten years. Currently, Richmond County Schools and Perdue Products, Inc. are the two largest employers in the county. Over the previous five years, the Board has experienced a steady decline in student enrollment of, on average, less than 1% per year. The Board expects student enrollment to remain consistent over the next several years, with little change anticipated. MAJOR INITIATIVES We have implemented an extensive professional development program with our elementary and middle school teachers. For three days during the school year, all kindergarten through eighth grade teachers will participate in planning for standards based instruction. All elementary schools consist of kindergarten through grade five, middle schools with grades six through eight, a ninth grade academy, a senior high school serving grades ten through twelve, an alternative high school serving grades seven through twelve and an early college high school serving grades nine through twelve plus a two-year associate degree.

Letter of Transmittal (continued)

iii

INDEPENDENT AUDIT

Anderson Smith & Wike PLLC has audited the financial records and transactions of the Richmond County Board of Education for the year ended June 30, 2018. They are a firm of independent certified public accountants. In addition to meeting the requirements set forth in state statutes, the audit also was designed to meet the requirements of the federal Single Audit Act Amendments of 1996 and related OMB Uniform Guidance and the State Single Audit Implementation Act. The auditors’ report is included in the financial section of this report. FINANCIAL REPORTING AWARDS The Association of School Business Officials (ASBO) awarded a Certificate of Excellence in Financial Reporting to the Board for its comprehensive annual financial report for the year ended June 30, 2017. In order to be awarded a Certificate of Excellence, the Board published an easily readable and efficiently organized comprehensive annual financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Excellence is valid for a period of one year only. We believe that our current comprehensive annual financial report continues to meet the Certificate of Excellence Program’s requirements and we are submitting it to the ASBO to determine its eligibility for another certificate. We will also be submitting the report to the Government Finance Officers Association of the United States and Canada (GFOA) to determine its eligibility for their award program’s Certificate of Achievement for Excellence in Financial Reporting. ACKNOWLEDGMENTS The preparation of this report could not have been accomplished without the dedicated efforts of the finance staff and the Board’s independent certified public accounting firm of Anderson Smith & Wike PLLC. We wish to express appreciation to all employees who assisted in the timely closing of the Richmond County Board of Education’s fiscal records as well as the preparation of this report. We would also like to express appreciation to the members of The Board of Education for their support in planning and conducting the financial affairs of the school system in a responsible and professional manner. Respectfully submitted,

Dr. Cindy S. Goodman Tina Edmonds Superintendent Finance Officer

Principal Officers

Dr. Jeff Maples, Associate Superintendent


Hamlet, North Carolina

Bobbie Sue Ormsby, Vice ChairmanWiley Mabe, Chairman

July 1, 2017 - June 30, 2018

Board Members

Dr. Irene Aiken

Ronald Tillman

Dr. Cindy S. Goodman, Superintendent

Don Greene

Joe RichardsonJerry Ethridge

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The Certificate of Excellence in Financial Reporting

is presented to


for its Comprehensive Annual Financial Report (CAFR)

for the Fiscal Year Ended June 30, 2017.

The CAFR has been reviewed and met or exceeded

ASBO International’s Certificate of Excellence standards.

Charles E. Peterson, Jr., SFO, RSBA, MBA John D. Musso, CAE

President Executive Director

vi

Financial Section

1

Certified Public Accountants

ANDERSON SMITH & WIKE PLLCA S W

INDEPENDENT AUDITORS’ REPORT To the Richmond County Board of Education Hamlet, North Carolina Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the Richmond County Board of Education, as of and for the year ended June 30, 2018 and the related notes to the financial statements, which collectively comprise the Board’s basic financial statements as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors’ Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. 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, each major fund, and the aggregate remaining fund information of the Richmond County Board of Education as of June 30, 2018, and the respective changes in financial position and cash flows, where applicable, thereof and the respective budgetary comparisons for the General, State Public School, Federal Grants and Restricted Revenue funds for the year then ended in conformity with accounting principles generally accepted in the United States of America.

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Emphasis of Matter As discussed in Note 5 to the financial statements, beginning balances were restated due to the implementation of GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions, in 2018. Our opinion is not modified with respect to these changes. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that Management’s Discussion and Analysis on pages 3 through 9 and the Schedules of the Board’s Proportionate Share of the Net Pension Liability, OPEB Liability and OPEB Asset and the Schedules of Board Contributions on pages 47 and 52, respectively, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management 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. Supplementary and Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Richmond County Board of Education’s basic financial statements. The introductory section, individual fund budgetary schedules and the statistical tables are presented for purposes of additional analysis and are not a required part of the basic financial statements. The individual fund budgetary schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the 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 themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the individual fund budgetary schedules are fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. The introductory section and statistical tables have not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we express no opinion on them. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated August 30, 2018 on our consideration of the Richmond County Board of Education’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, 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 Richmond County Board of Education’s internal control over financial reporting and compliance.

August 30, 2018 Rockingham, North Carolina

RICHMOND COUNTY BOARD OF EDUCATION MANAGEMENT’S DISCUSSION AND ANALYSIS

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This section of the Richmond County Board of Education’s (the "Board") financial report represents our discussion and analysis of the financial performance of the Board for the year ended June 30, 2018. This information should be read in conjunction with the audited financial statements included in this report. Financial Highlights

As discussed in Note 5 to the financial statements, the Board implemented Governmental Accounting Standards Board (GASB) statement 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions, in the fiscal year ending June 30, 2018. As a result, net position as previously reported at June 30, 2017 for governmental and business-type activities decreased by $97.1 million and $4.0 million, respectively. For the fiscal year ended June 30, 2018, the Board’s total government-wide net position (not including the decrease in net position due to the GASB 75 restatement) decreased by $5.3 million. Governmental activities net position decreased by $5.2 million and business-type activities net position decreased by $103,000. Total government-wide net investment in capital assets decreased by $1.8 million, or 3.1%, from the

prior year. Governmental activities net investment in capital assets decreased by $1.7 million, or 3.1%, and business-type activities net investment in capital assets decreased by $37,000, or 7.1%.

Total restricted net position increased by $236,000, or 6.4%. Restricted net position is found only in

the governmental activities. The Board’s total government-wide unrestricted net position at June 30, 2018 decreased by $104.9

million from the prior year due largely to the $101.1 million GASB 75 restatement. Net of this restatement, governmental activities unrestricted net position decreased by $3.7 million while business-type activities unrestricted net position decreased by $77,000 over the prior year.

A financial reporting award from the Association of School Business Officials International was

received for the fiscal year ended June 30, 2017. Overview of the Financial Statements The audited financial statements of the Richmond County Board of Education consist of four components. They are as follows: Independent Auditors' Report Management's Discussion and Analysis (required supplementary information) Basic Financial Statements Required supplemental section that presents budgetary schedules for governmental and enterprise

funds. The Basic Financial Statements include two types of statements that present different views of the Board’s finances. The first is the Government-wide Statements. The government-wide statements are presented on the full accrual basis of accounting and include the statement of net position and the statement of activities. The statement of net position includes all of the Board’s assets, deferred outflows of resources, liabilities and deferred inflows of resources. Assets and liabilities are classified in the order of relative liquidity for assets and due date for liabilities. This statement provides a summary of the Board's investment in assets, deferred outflows of resources, deferred inflows of resources and obligations to creditors. Liquidity and financial flexibility can be evaluated using the information contained in this statement. The statement of activities summarizes the Board’s revenues and expenses for the current year. A net (expense) revenue format is used to indicate to what extent each function is self-sufficient. The second set of statements included in the basic financial statements is the Fund Financial Statements, which are presented for the Board’s governmental funds and proprietary funds. These


4

statements present the governmental funds on the modified accrual basis of accounting, measuring the near term inflows and outflows of financial resources and what is available at year-end to spend in the next fiscal year. The proprietary funds are presented on the full accrual basis of accounting. The fund financial statements focus on the Board’s most significant funds. Because a different basis of accounting is used in the government-wide statements, reconciliation from the governmental fund financial statements to the government-wide statements is required. The government-wide statements provide information about the Board as an economic unit while the fund financial statements provide information on each of the financial resources of each of the Board’s major funds. Government-wide Statements The government-wide statements report information about the unit as a whole using accounting methods similar to those used by private-sector companies. The statement of net position includes all of the Board’s assets, deferred outflows of resources, liabilities and deferred inflows of resources. All of the current year’s revenues and expenses are accounted for in the statement of activities regardless of when cash is received or paid. The two government-wide statements report the Board’s net position and how it has changed. Net position is the difference between the Board’s assets plus deferred outflows of resources and liabilities plus deferred inflows of resources. This is one way to measure the unit’s financial health or position.

Over time, increases or decreases in the Board’s net position are an indicator of whether its financial position is improving or deteriorating.

To assess the Board’s overall health, you need to consider additional non-financial factors such

as changes in the County’s property tax base and the condition of its school buildings and other physical assets.

The unit’s activities are divided into two categories in the government-wide statements:

Governmental activities: Most of the Board’s basic services are included here, such as regular and special education, transportation, and administration. County funding and State and federal aid finance most of these activities.

Business-type activities: The Board charges fees to help it cover the costs of certain services it

provides. School food service is included here. The government-wide statements are shown as Exhibits 1 and 2 of this report. Fund Financial Statements The fund financial statements provide more detailed information about the Board’s funds, focusing on its most significant or “major” funds - not the unit as a whole. Funds are accounting devices the Board uses to keep track of specific sources of funding and spending on particular programs.

Some funds are required by State law, such as the State Public School Fund.

The Board has established other funds to control and manage money for a particular purpose or to show that it is properly using certain revenues, such as in the Federal Grants Fund.

Richmond County Board of Education has two types of funds: Governmental funds: Most of the Board’s basic services are included in the governmental funds, which generally focus on two things – 1) how cash and other assets that can readily be converted to cash flow in and out, and 2) the balances left at year-end that are available for spending. As a result of this focus, the governmental funds statements provide a detailed short-term view that helps the reader determine whether there are more or fewer financial resources that can be spent in the coming year to finance the Board’s programs. Because this information does not encompass the additional long-term focus of the


5

government-wide statements, additional information at the bottom of the governmental fund statements, in the form of a reconciliation, explains the relationship (or differences) between the government-wide and the fund financial statements. The Board has several governmental funds: the General Fund, the State Public School Fund, the Individual Schools Fund, the Capital Outlay Fund, the Restricted Revenue Fund and the Federal Grants Fund. The governmental fund statements are shown as Exhibits 3, 4, 5 and 6 of this report. Proprietary fund: Services for which the Board charges a fee are generally reported in the proprietary funds. The proprietary fund statements are reported on the same full accrual basis of accounting as the government-wide statements. The Richmond County Board of Education’s only proprietary fund is an enterprise fund, the School Food Service Fund. The proprietary fund statements are shown as Exhibits 7, 8, and 9 of this report. Financial Analysis of the Board as a Whole Net position is an indicator of the fiscal health of the Board. Liabilities and deferred inflows of resources exceeded assets and deferred outflows of resources by $55.4 million as of June 30, 2018 as compared to assets and deferred outflows exceeding liabilities and deferred inflows by $51.0 million as of June 30, 2017, a decrease of $106.4 million. As previously discussed, this decrease is primarily due to the implementation of GASB 75 during the year which had the effect of reducing beginning of year net position by $101.1 million. Following is a summary of the Statement of Net Position at June 30, 2018 and 2017:

6/30/18 6/30/17 6/30/18 6/30/17 6/30/18 6/30/17

Current assets 9,924,091$ 9,650,323$ 1,414,337$ 1,266,457$ 11,338,428$ 10,916,780$ Capital assets 55,333,542 57,203,351 486,828 523,867 55,820,370 57,727,218

Total assets 65,257,633 66,853,674 1,901,165 1,790,324 67,158,798 68,643,998

Deferred outflows of resources 14,062,506 15,928,593 581,513 650,600 14,644,019 16,579,193

Current liabilities 5,884,128 5,641,733 367,427 347,780 6,251,555 5,989,513 Long-term liabilities 98,245,224 25,810,938 4,025,078 1,016,956 102,270,302 26,827,894

Total liabilities 104,129,352 31,452,671 4,392,505 1,364,736 108,521,857 32,817,407

Deferred inflows of resources 27,508,769 1,311,509 1,137,544 53,568 28,646,313 1,365,077

Net investment in capital assets 54,426,568 56,150,899 486,828 523,867 54,913,396 56,674,766 Restricted net position 3,940,616 3,704,542 10,813 - 3,951,429 3,704,542 Unrestricted net position (deficit) (110,685,166) (9,837,354) (3,545,012) 498,753 (114,230,178) (9,338,601)

Total net position (deficit) (52,317,982)$ 50,018,087$ (3,047,371)$ 1,022,620$ (55,365,353)$ 51,040,707$

Table 1

Condensed Statement of Net Position

As of June 30, 2018 and 2017

Governmental Acitivities Business-type Activities Total Primary Government

The net position of the Board’s governmental activities decreased $102.3 million during the year, from $50.0 million at June 30, 2017 to $(52.3) million at June 30, 2018, indicating a decline in the financial condition of the Board. The GASB 75 restatement accounted for the majority of this decrease, reducing beginning of year governmental activities net position by $97.1 million. Restricted net position increased


6

by $236,000 while unrestricted net position decreased $100.8 million compared to the prior year, due primarily to implementation of GASB 75. Net investment in capital assets decreased $1.7 million due to an excess of depreciation expense over capital additions for the year. Net of a reduction of $4.0 million to beginning of year net position for implementation of GASB 75, the net position of the Board’s business-type activities decreased $103,000 during the year. This decrease is the net loss incurred by our school food service operations during the 2018 fiscal year. The following table shows the revenues and expenses of the Board for the current and prior fiscal years:

6/30/18 6/30/17 6/30/18 6/30/17 6/30/18 6/30/17

Revenues:Program revenues:

Charges for services 2,007,130$ 1,831,979$ 396,597$ 462,551$ 2,403,727$ 2,294,530$ Operating grants and contributions 52,157,896 50,250,660 4,545,598 4,471,329 56,703,494 54,721,989 Capital grants and contributions 576,693 677,346 - - 576,693 677,346

General revenues:County appropriations 10,163,128 9,786,794 - - 10,163,128 9,786,794 State appropriations 4,216,616 4,236,314 - - 4,216,616 4,236,314 Other revenues 766,687 727,595 - - 766,687 727,595

Total revenues 69,888,150 67,510,688 4,942,195 4,933,880 74,830,345 72,444,568

Expenses:Governmental activities:

Instructional services 56,823,832 53,175,057 - - 56,823,832 53,175,057 System-wide support services 16,071,541 14,243,486 - - 16,071,541 14,243,486 Ancillary services 99,100 112,924 - - 99,100 112,924 Payments to other governments 22,631 25,510 - - 22,631 25,510 Unallocated depreciation 2,019,441 2,005,193 - - 2,019,441 2,005,193

Business-type activities:School food service - - 5,090,553 4,876,684 5,090,553 4,876,684

Total expenses 75,036,545 69,562,170 5,090,553 4,876,684 80,127,098 74,438,854

Excess (deficiency) before transfers (5,148,395) (2,051,482) (148,358) 57,196 (5,296,753) (1,994,286) Transfers in (out) (45,000) (73,248) 45,000 73,248 - - Increase (decrease) in net position (5,193,395) (2,124,730) (103,358) 130,444 (5,296,753) (1,994,286)

Beginning net position, as previously reported 50,018,087 52,142,817 1,022,620 892,176 51,040,707 53,034,993 Restatement (97,142,674) - (3,966,633) - (101,109,307) - Beginning net position

(deficit), restated (47,124,587) 52,142,817 (2,944,013) 892,176 (50,068,600) 53,034,993 Ending net position (deficit) (52,317,982)$ 50,018,087$ (3,047,371)$ 1,022,620$ (55,365,353)$ 51,040,707$

Governmental Activities Business-type Activities Total Primary Government

Table 2

Condensed Statement of Activities

For the Fiscal Years Ended June 30, 2018 and 2017


7

Total governmental activities generated revenues of $69.9 million while expenses in this category totaled $75.0 million for the year ended June 30, 2018, resulting in a decrease in net position of $5.2 million (including transfers to business-type activities of $45,000). Comparatively, revenues were $67.5 million, expenses totaled $69.6 million and transfers out were $73,000 for the year ended June 30, 2017, resulting in a decrease in net position of $2.1 million. In comparing the two years, revenues increased $2.4 million, or 3.5%, due primarily to the receipt of an additional $1.6 million in combined SPSF and Federal Grants Fund revenues. Expenses increased by $5.5 million, or 7.9%, over the prior year. The overall increase in expenses is largely attributable to a $1.0 million increase in pension expense and the recording of $4.1 million of OPEB expense due to the implementation of GASB 75. See the footnotes for detailed information regarding pension and OPEB-related amounts and disclosures. The Board’s primary sources of revenues were funding from the State of North Carolina, Richmond County, and the United States Government, which respectively comprised 71.1%, 14.5% and 9.3% of our total revenues. As would be expected, the major component of our expenses was instructional services which accounted for 75.7% of our total expenses during the most recent fiscal year. Of the remaining 24.3% of our total expenses, 21.4% was attributable to system-wide support services. Our business-type activities generated revenues of $4.9 million while expenses in this category totaled $5.1 million for the year ended June 30, 2018. For the year, net position decreased by $103,000 (including transfers in of $45,000). Comparatively, revenues were $4.9 million and expenses were also $4.9 million for the year ended June 30, 2017, resulting in an increase in net position of $130,000 (including transfers in of $73,000). In comparing the two years, revenues were comparable with no significant changes while expenses increased by $214,000, primarily due to the recording of $219,000 in OPEB expense related to the implementation of GASB 75. Financial Analysis of the Board’s Funds

Governmental Funds: The focus of Richmond County Board of Education’s governmental funds is to provide information on near-term inflows, outflows, and balances of usable resources. Such information is useful in assessing the Board’s financing requirements. The Board’s governmental funds reported a combined fund balance of $7.2 million at June 30, 2018, a decrease of $92,000 from the $7.3 million reported at June 30, 2017. The Board’s General and Individual Schools funds each reported decreases in fund balance for the year ended June 30, 2018 of $84,000 and $109,000, respectively, while the Restricted Revenue and Capital Outlay funds reported increases of $40,000 and $61,000, respectively. Overall, total governmental fund revenues increased by $2.4 million, or 3.5%, while total expenditures increased by $1.7 million, or 2.5%, over the prior year. These increases are primarily due to the receipt and disbursement of an additional $1.6 million of SPSF and Federal Grants Fund proceeds for instructional and system-wide support services.


8

Categorization of Expenditures for Governmental Funds

3%20%

76%

1% Instructional Services

System-wide SupportServices

Capital Outlay

Other

Expenditures presented on modified accrual basis of accounting. Proprietary Fund: The Board’s business-type fund, the School Food Service Fund, reported a decrease in net position of $103,000 for the fiscal year ended June 30, 2018 compared to an increase of $130,000 for the same 2017 period. See the section above titled Financial Analysis of the Board as a Whole for more discussion regarding School Food Service Fund operating results for the year. General Fund Budgetary Highlights Over the course of a year, the Board will revise the budget, as necessary, to account for changes in revenue expectations and program allocations. However, during the year ended June 30, 2018, no significant budget revisions were made in the General Fund as revenue and expenditure expectations remained consistent throughout the year. For the year, the Board’s General Fund reported a decrease in fund balance of $84,000 compared to a decrease of $289,000 in the prior year. Overall, revenues and expenditures were comparable to the prior year with no unusual fluctuations. Due to some State and federal revenue sources being uncertain at the start of the year, management budgeted $2.5 million of fund balance in case it was needed to cover instructional or system-wide support service costs that could not be paid from State or federal funds. The district did not have to use all of this appropriated fund balance as State and federal sources were used to pay these budgeted expenditures. This resulted in the General Fund reporting a combined $2.0 million positive budget variance for instructional and system-wide support services expenditures for the year. Capital Assets Total primary government capital assets were $55.8 million at June 30, 2018 compared to $57.7 million at June 30, 2017, a decline of 3.3%. More detailed information about the Board’s capital assets is contained in Note 2 to the financial statements.


9

The following is a summary of the Board’s capital assets, net of depreciation, at June 30, 2018 and 2017:

6/30/18 6/30/17 6/30/18 6/30/17 6/30/18 6/30/17

Land 624,643$ 624,643$ -$ -$ 624,643$ 624,643$ Construction in progress - - - - - - Buildings and

improvements 51,141,484 52,836,134 - - 51,141,484 52,836,134 Equipment and furniture 1,158,807 1,334,459 486,828 523,867 1,645,635 1,858,326 Vehicles 2,408,608 2,408,115 - - 2,408,608 2,408,115

Total 55,333,542$ 57,203,351$ 486,828$ 523,867$ 55,820,370$ 57,727,218$

Table 3

Summary of Capital Assets

As of June 30, 2018 and 2017

Governmental Acitivities Business-type Activities Total Primary Government

Debt Outstanding During the year, the Board’s long-term installment purchase debt decreased by $145,000 from $1.1 million at June 30, 2017 to $907,000 at June 30, 2018. The Board is limited by North Carolina General Statutes with regards to the types of debt it can issue and for what purpose that debt can be used. The County holds virtually all debt issued for school capital construction. More detailed information about the Board’s outstanding debt is contained in Note 2 to the financial statements. Economic Factors County funding is a major source of income for the Board; therefore, the County’s economic outlook directly affects that of the Board’s. The following economic factors must be considered when viewing the County’s ability to provide the required level of funding:

As of June 30, 2018, Richmond County experienced an unemployment rate of approximately

5.8% as compared to an unemployment rate of approximately 5.7% at June 30, 2017. Richmond County is still well above the June 30, 2018 State of N.C. and national unemployment rates which were both 4.2%.

A primary element of the local economy, textiles, has experienced significant losses in recent years. The County administration along with the Richmond County Economic Development team and concerned citizens are actively cultivating new alternatives to offset the dwindling impact of textiles on the local economy. The County is anticipating improvements in industrial growth with the construction of new major highways in the area.

Requests for Information This report is intended to provide a summary of the financial condition of Richmond County Board of Education. Questions or requests for additional information should be addressed to:

Tina Edmonds, Finance Officer Richmond County Board of Education

118 Vance Street Hamlet, NC 28345

RICHMOND COUNTY BOARD OF EDUCATION Exhibit 1

Governmental Activities

Business-type Activities Total

Assets

Cash and cash equivalents 7,064,995$ 1,172,606$ 8,237,601$ Due from other governments 2,681,204 123,304 2,804,508 Receivables 38,473 - 38,473 Net OPEB asset 139,419 5,765 145,184 Inventories - 112,662 112,662 Capital assets:

Land 624,643 - 624,643 Other capital assets, net of depreciation 54,708,899 486,828 55,195,727

Total capital assets 55,333,542 486,828 55,820,370

Total assets 65,257,633 1,901,165 67,158,798

Deferred Outflows of Resources 14,062,506 581,513 14,644,019

Liabilities

Accounts payable and accrued expenses 262,297 - 262,297 Accrued salaries and wages payable 2,304,807 233,374 2,538,181 Unearned revenue - 10,761 10,761 Long-term liabilities:

Due within one year 3,317,024 123,292 3,440,316 Due in more than one year 98,245,224 4,025,078 102,270,302

Total liabilities 104,129,352 4,392,505 108,521,857

Deferred Inflows of Resources 27,508,769 1,137,544 28,646,313

Net position

Net investment in capital assets 54,426,568 486,828 54,913,396 Restricted for:

Stabilization by State statute 71,450 - 71,450 School capital outlay 2,063,192 - 2,063,192 Instructional services 1,089,794 - 1,089,794 Individual schools activities 454,679 - 454,679 DIPNC OPEB plan 261,501 10,813 272,314

Unrestricted (deficit) (110,685,166) (3,545,012) (114,230,178)

Total net position (deficit) (52,317,982)$ (3,047,371)$ (55,365,353)$

STATEMENT OF NET POSITIONJune 30, 2018

Primary Government

The notes to the basic financial statements are an integral part of this statement.

10


STATEMENT OF ACTIVITIESFor the Fiscal Year Ended June 30, 2018

Functions/Programs ExpensesCharges for

Services

Operating Grants and

Contributions

Capital Grants and

ContributionsGovernmental

ActivitiesBusiness-type

Activities TotalPrimary government:

Governmental activities:Instructional services:

Regular instructional 33,484,972$ 80,016$ 28,441,789$ -$ (4,963,167)$ -$ (4,963,167)$ Special populations 7,822,437 - 7,545,429 - (277,008) - (277,008) Alternative programs 4,034,244 - 3,782,107 - (252,137) - (252,137) School leadership 4,495,182 - 2,958,209 - (1,536,973) - (1,536,973) Co-curricular 2,080,552 1,925,839 - - (154,713) - (154,713) School-based support 4,906,445 - 3,431,796 - (1,474,649) - (1,474,649)

System-wide support services: Support and development 1,943,213 - 608,995 - (1,334,218) - (1,334,218) Special population support and development 123,107 - 104,508 - (18,599) - (18,599) Alternative programs and services support and development 244,551 - 233,298 - (11,253) - (11,253) Technology support 86,873 - 86,667 - (206) - (206) Operational support 11,572,033 - 4,178,495 576,693 (6,816,845) - (6,816,845) Financial and human resource services 1,230,724 1,275 258,207 - (971,242) - (971,242) Accountability 40,782 - 26,925 - (13,857) - (13,857) Policy, leadership and public relations 830,258 - 411,387 - (418,871) - (418,871)

Ancillary services 99,100 - - - (99,100) - (99,100) Payments to other governments 22,631 - 90,084 - 67,453 - 67,453 Unallocated depreciation expense** 2,019,441 - - - (2,019,441) - (2,019,441) Total governmental activities 75,036,545 2,007,130 52,157,896 576,693 (20,294,826) - (20,294,826)

Business-type activities:School food service 5,090,553 396,597 4,545,598 - - (148,358) (148,358)

Total primary government 80,127,098$ 2,403,727$ 56,703,494$ 576,693$ (20,294,826) (148,358) (20,443,184)

General revenues:Unrestricted county appropriations - operating 7,763,448 - 7,763,448 Unrestricted county appropriations - capital 2,399,680 - 2,399,680 Unrestricted State appropriations - operating 4,216,616 - 4,216,616 Investment earnings, unrestricted 42,466 - 42,466 Miscellaneous, unrestricted 724,221 - 724,221

Transfers (45,000) 45,000 -

Total general revenues and transfers 15,101,431 45,000 15,146,431 Change in net position (5,193,395) (103,358) (5,296,753)

Net position - beginning, as previously reported 50,018,087 1,022,620 51,040,707 Restatement (Note 5) (97,142,674) (3,966,633) (101,109,307) Net position (deficit) - beginning, as restated (47,124,587) (2,944,013) (50,068,600)

**This amount excludes the depreciation that is included in the Net position (deficit) - ending (52,317,982)$ (3,047,371)$ (55,365,353)$ direct expenses of the various programs.


11

Primary GovernmentProgram Revenues Net (Expense) Revenue and Changes in Net Position


Major Funds Non-major Fund

GeneralState Public

School Federal GrantsRestricted Revenue Capital Outlay

Individual Schools

Total Governmental

FundsAssets

Cash and cash equivalents 3,562,739$ -$ -$ 1,422,980$ 1,624,597$ 454,679$ 7,064,995$ Due from other governments 8,240 2,020,245 214,112 - 438,607 - 2,681,204 Accounts receivable - - - 38,473 - - 38,473 Due from other funds - - - - - 24,737 24,737

Total assets 3,570,979$ 2,020,245$ 214,112$ 1,461,453$ 2,063,204$ 479,416$ 9,809,409$

Liabilities and Fund balances

Liabilities:Accounts payable and accrued liabilities 262,285$ -$ -$ -$ 12$ -$ 262,297$ Accrued salaries and wages payable 5,076 2,020,245 214,112 65,374 - - 2,304,807 Due to other funds 24,737 - - - - - 24,737

Total liabilities 292,098 2,020,245 214,112 65,374 12 - 2,591,841

Fund balances:Restricted: Stabilization by State statute 8,240 - - 38,473 - 24,737 71,450 School capital outlay - - - - 2,063,192 - 2,063,192 Instructional services 28,951 - - 1,060,843 - - 1,089,794 Individual schools - - - - - 454,679 454,679 Assigned:

Subsequent year's expenditures 2,483,542 - - - - - 2,483,542

Special revenues - - - 296,763 - - 296,763 Unassigned 758,148 - - - - - 758,148

Total fund balances 3,278,881 - - 1,396,079 2,063,192 479,416 7,217,568

Total liabilities and fund balances 3,570,979$ 2,020,245$ 214,112$ 1,461,453$ 2,063,204$ 479,416$ 9,809,409$


June 30, 2018

BALANCE SHEET

GOVERNMENTAL FUNDS

12

RICHMOND COUNTY BOARD OF EDUCATION Exhibit 3 (continued)

7,217,568$

139,419

55,333,542

10,429,681

3,632,825

(4,876,091)

(20,459,517)

(76,226,640)

(1,022,380)

(26,486,389)

(52,317,982)$ Net position (deficit) of governmental activities

Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds.

Some liabilities, including those for compensated absences and installment purchases, are not due and payable in the current period and therefore are not reported in the funds.

Deferred outflows of resources related to pensions

Deferred outflows of resources related to OPEB

Net OPEB liability

Net pension liability

Amounts reported for governmental activities in the statement of net position (Exhibit 1) are different because:

Net OPEB asset

Total fund balances of governmental funds

Deferred inflows of resources related to OPEB

Deferred inflows of resources related to pensions

GOVERNMENTAL FUNDS

June 30, 2018


BALANCE SHEET

13


STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES

GOVERNMENTAL FUNDSFor the Fiscal Year Ended June 30, 2018

Major Funds Non-major Fund

GeneralState Public

School Federal GrantsRestricted Revenue Capital Outlay

Individual Schools

Total Governmental

FundsRevenues:

State of North Carolina -$ 47,869,901$ -$ 1,453,954$ 576,693$ -$ 49,900,548$ Richmond County:

Local current expense 7,763,448 - - - - 7,763,448 Other - - - - 2,399,680 - 2,399,680

U.S. Government 90,633 - 6,304,557 119,090 - - 6,514,280 Other 989,251 - - 630,799 14,389 1,925,839 3,560,278 Total revenues 8,843,332 47,869,901 6,304,557 2,203,843 2,990,762 1,925,839 70,138,234

Expenditures:Current:

Instructional services: Regular instructional 1,294,099 28,453,201 379,595 1,205,970 - - 31,332,865 Special populations 110,239 5,464,326 1,757,346 415,535 - - 7,747,446 Alternative programs 56,361 893,647 2,901,924 - - - 3,851,932 School leadership 309,816 3,804,358 - 106,165 - - 4,220,339 Co-curricular 41,157 - - - - 2,034,472 2,075,629 School-based support 278,554 3,842,221 293,937 209,982 - - 4,624,694

System-wide support services: Support and development 1,185,703 214,398 466,712 - - - 1,866,813 Special population support and development - 11,797 92,711 - - - 104,508 Alternative programs and services support and development - - 233,298 - - - 233,298 Technology support - 30,366 56,301 - - - 86,667 Operational support 4,389,368 4,100,846 32,649 202,549 644,925 - 9,370,337 Financial and human resource services 799,288 548,459 - - - - 1,347,747 Accountability 5,490 26,925 - - - - 32,415 Policy, leadership and public relations 362,729 434,357 - - - - 797,086

Ancillary services 71,529 - - 24,000 - - 95,529 Non-programmed charges 22,631 - 90,084 - - - 112,715

Debt service:Principal retirement - - - - 576,693 - 576,693

Capital outlay - - - - 2,139,636 - 2,139,636 Total expenditures 8,926,964 47,824,901 6,304,557 2,164,201 3,361,254 2,034,472 70,616,349

Revenues over (under) expenditures (83,632) 45,000 - 39,642 (370,492) (108,633) (478,115)

Other financing uses:Transfers to other funds - (45,000) - - - - (45,000) Installment purchase obligations issued - - - - 431,215 - 431,215 Total other financing sources (uses) - (45,000) - - 431,215 - 386,215

Net change in fund balance (83,632) - - 39,642 60,723 (108,633) (91,900) Fund balances:

Beginning of year 3,362,513 - - 1,356,437 2,002,469 588,049 7,309,468

End of year 3,278,881$ -$ -$ 1,396,079$ 2,063,192$ 479,416$ 7,217,568$


14


Net changes in fund balances - total governmental funds (91,900)$

Governmental funds report capital outlays as expenditures. However, in the Statement ofActivities, the cost of those assets is allocated over their estimated useful lives andreported as depreciation expense. This is the amount by which depreciation exceededcapital outlays in the current period. (1,863,587)

Contributions to the pension plan in the current fiscal year are not included on thestatement of activities 3,947,171

Contributions to the OPEB plans in the current fiscal year are not included on thestatement of activities 2,266,511

The issuance of long-term debt provides current financial resources to governmental funds,while the repayment of the principal of long-term debt consumes the current financialresources of governmental funds. Neither transaction has any effect on net position. Also,governmental funds report the effect of premiums, discounts and similar items when debtis first issued, whereas these amounts are deferred and amortized in the statement ofactivities. This amount is the net effect of these differences in the treatment of long-termdebt and related items. 145,478

Some expenses reported in the statement of activities do not require the use of currentfinancial resources and therefore are not reported as expenditures in governmental funds.

Pension expense (5,365,658) Net OPEB expense (4,064,621) Compensated absences (160,567) Loss on disposal of capital assets (6,222)

Total changes in net position of governmental activities (5,193,395)$


RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES

IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIESFor the Fiscal Year Ended June 30, 2018

Amounts reported for governmental activities in the statement of activities are differentbecause:

15


BUDGET AND ACTUAL

Variance withFinal Budget

Original Final PositiveBudget Budget Actual (Negative)

Revenues:State of North Carolina -$ -$ -$ -$ Richmond County 7,763,448 7,763,448 7,763,448 - U.S. Government 90,000 90,000 90,633 633 Other 660,000 660,000 989,251 329,251

Total revenues 8,513,448 8,513,448 8,843,332 329,884


Instructional services 3,897,427 3,911,427 2,090,226 1,821,201 System-wide support services 6,961,063 6,947,063 6,742,578 204,485 Ancillary services 109,000 109,000 71,529 37,471 Non-programmed charges 29,500 29,500 22,631 6,869

Total expenditures 10,996,990 10,996,990 8,926,964 2,070,026

Revenues over (under) expenditures (2,483,542) (2,483,542) (83,632) 2,399,910

Other financing uses:Transfers to other funds - - - -

Fund balance appropriated 2,483,542 2,483,542 - (2,483,542)

Net change in fund balance -$ -$ (83,632) (83,632)$

Fund balances:Beginning of year 3,362,513

End of year 3,278,881$


STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES -

General Fund

GENERAL FUND AND ANNUALLY BUDGETED MAJOR SPECIAL REVENUE FUNDSFor the Fiscal Year Ended June 30, 2018

16


BUDGET AND ACTUAL



Revenues:State of North Carolina 47,036,980$ 49,277,368$ 47,869,901$ (1,407,467)$ Richmond County - - - - U.S. Government - - - - Other - - - -

Total revenues 47,036,980 49,277,368 47,869,901 (1,407,467)


Instructional services 42,230,404 43,832,035 42,457,753 1,374,282 System-wide support services 4,761,576 5,400,333 5,367,148 33,185 Ancillary services - - - - Non-programmed charges - - - -

Total expenditures 46,991,980 49,232,368 47,824,901 1,407,467

Revenues over (under) expenditures 45,000 45,000 45,000 -

Other financing uses:Transfers to other funds (45,000) (45,000) (45,000) -

Fund balance appropriated - - - -

Net change in fund balance -$ -$ - -$

Fund balances:Beginning of year -

End of year -$



GENERAL FUND AND ANNUALLY BUDGETED MAJOR SPECIAL REVENUE FUNDS

State Public School Fund

For the Fiscal Year Ended June 30, 2018

17



BUDGET AND ACTUAL



Revenues:State of North Carolina -$ -$ -$ -$ Richmond County - - - - U.S. Government 908,743 7,866,563 6,304,557 (1,562,006) Other - - - -

Total revenues 908,743 7,866,563 6,304,557 (1,562,006)


Instructional services 211,040 6,031,979 5,332,802 699,177 System-wide support services 690,007 1,279,206 881,671 397,535 Ancillary services - - - - Non-programmed charges 7,696 555,378 90,084 465,294

Total expenditures 908,743 7,866,563 6,304,557 1,562,006

Revenues over (under) expenditures - - - -


Fund balance appropriated - - - -

Net change in fund balance -$ -$ - -$

Fund balances:Beginning of year -

End of year -$


GENERAL FUND AND ANNUALLY BUDGETED MAJOR SPECIAL REVENUE FUNDS

Federal Grants Fund


18



BUDGET AND ACTUAL



Revenues:State of North Carolina 1,288,212$ 1,488,212$ 1,453,954$ (34,258)$ Richmond County - - - - U.S. Government 119,347 119,347 119,090 (257) Other 229,095 365,051 630,799 265,748

Total revenues 1,636,654 1,972,610 2,203,843 231,233


Instructional services 2,590,976 2,699,651 1,937,652 761,999 System-wide support services 130,279 330,279 202,549 127,730 Ancillary services - 24,000 24,000 - Non-programmed charges - 3,281 - 3,281

Total expenditures 2,721,255 3,057,211 2,164,201 893,010

Revenues over (under) expenditures (1,084,601) (1,084,601) 39,642 1,124,243


Fund balance appropriated 1,084,601 1,084,601 - (1,084,601)

Net change in fund balance -$ -$ 39,642 39,642$

Fund balances:Beginning of year 1,356,437



GENERAL FUND AND ANNUALLY BUDGETED MAJOR SPECIAL REVENUE FUNDS For the Fiscal Year Ended June 30, 2018

Restricted Revenue Fund

19


STATEMENT OF NET POSITION

PROPRIETARY FUND TYPE

Major FundSchool Food

ServiceAssets

Current assets:Cash and cash equivalents 1,172,606$ Due from other governments 123,304 Net OPEB asset 5,765 Inventories 112,662

Total current assets 1,414,337

Noncurrent assets:Capital assets:

Furniture and office equipment, net 486,828

Total assets 1,901,165

Deferred Outflows of Resources 581,513

Liabilities

Current liabilities:Accrued salaries and wages payable 233,374 Compensated absences 123,292 Unearned revenue 10,761

Total current liabilities 367,427

Noncurrent liabilities:Net pension liability 846,044 Net OPEB liability 3,152,131 Compensated absences 26,903

Total noncurrent liabilities 4,025,078

Total liabilities 4,392,505

Deferred Inflows of Resources 1,137,544

Net position

Net investment in capital assets 486,828 DIPNC OPEB plan 10,813 Unrestricted (deficit) (3,545,012)

Total net position (deficit) (3,047,371)$


Enterprise Fund

June 30, 2018

20



Service

Operating revenues: Food sales 396,597$

Operating expenses:Food cost:

Purchase of food 1,583,105 Donated commodities 316,854

Salaries and benefits 2,704,167 Indirect costs 160,000 Materials and supplies 193,619 Repairs and maintenance 12,486 Depreciation 64,795 Non-capitalized equipment 5,311 Contracted services 18,728 Other 31,488

Total operating expenses 5,090,553

Operating loss (4,693,956)

Nonoperating revenues:Federal reimbursements 4,228,744 Federal commodities 316,854

Total nonoperating revenues 4,545,598

Income (loss) before transfers (148,358)

Transfers from other funds 45,000

Change in net position (103,358)

Net position, beginning of year, as previously reported 1,022,620 Restatement (Note 5) (3,966,633)

Net position (deficit), beginning of year, as restated (2,944,013)

Net position (deficit), end of year (3,047,371)$


Enterprise Fund

PROPRIETARY FUND TYPEFor the Fiscal Year Ended June 30, 2018

STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION

21


STATEMENT OF CASH FLOWS



Service Cash flows from operating activities: Cash received from customers 399,000$ Cash paid for goods and services (1,996,688) Cash paid to employees for services (2,450,609) Net cash used by operating activities (4,048,297)

Cash flows from noncapital financing activities: Federal and State reimbursements and grants 4,252,941

Cash flows from capital and related financing activities: Purchase of capital assets (27,756)

Net increase in cash and cash equivalents 176,888

Cash and cash equivalents, beginning of year 995,718

Cash and cash equivalents, end of year 1,172,606$

Reconciliation of operating loss to net cash used by operating activities: Operating loss (4,693,956)$ Adjustments to reconcile operating loss to net cash used by operating activities: Depreciation 64,795 Donated commodities 316,854 Salaries paid by special revenue fund 45,000 Changes in assets and liabilities: Decrease in accounts receivable 2,527 Decrease in net OPEB asset 228 Decrease in inventories 8,049 Increase in accrued salaries and wages payable 11,683 Decrease in unearned revenue (124) Increase in net pension liability (144,476) Decrease in net OPEB liability (913,716) Decrease in deferred outflows 162,308 Increase in deferred inflows 1,083,976 Increase in compensated absences payable 8,555

Total adjustments 645,659

Net cash used by operating activities (4,048,297)$


Enterprise Fund

22


STATEMENT OF CASH FLOWS



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The School Food Service Fund received donated commodities with a value of $316,854 during the fiscal year.The receipt of these commodities is reflected as a nonoperating revenue on Exhibit 8. The consumption of thesecommodities is recorded as an operating expense.

The State Public School Fund paid salaries and benefits of $45,000 to administrative personnel of the SchoolFood Service Fund during the fiscal year. The payment is reflected as a transfer in and an operating expense onExhibit 8.

NONCASH OPERATING AND NONCAPITAL FINANCING ACTIVITIES:

RICHMOND COUNTY BOARD OF EDUCATION NOTES TO THE FINANCIAL STATEMENTS For the Fiscal Year Ended June 30, 2018

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NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies of Richmond County Board of Education conform to generally accepted accounting principles as applicable to governments. The following is a summary of the more significant accounting policies: A. Reporting Entity The Richmond County Board of Education (Board) is a Local Education Agency empowered by State law [Chapter 115C of the North Carolina General Statutes] with the responsibility to oversee and control all activities related to public school education in Richmond County, North Carolina. The Board receives State, local, and federal government funding and must adhere to the legal requirements of each funding entity. The Board has no component units. B. Basis of Presentation

Government-wide Statements: The statement of net position and the statement of activities display information about the Board. These statements include the financial activities of the overall government. Eliminations have been made to minimize the effect of internal activities upon revenues and expenses. These statements distinguish between the governmental and business-type activities of the Board. Governmental activities generally are financed through intergovernmental revenues and other non-exchange transactions. Business-type activities are financed in whole or in part by fees charged to external parties. The statement of activities presents a comparison between direct expenses and program revenues for the different business-type activities of the Board and for each function of the Board’s governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Indirect expense allocations that have been made in the funds have been reversed for the statement of activities. Program revenues include (a) fees and charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues are presented as general revenues. Fund Financial Statements: The fund financial statements provide information about the Board’s funds. Separate statements for each fund category – governmental and proprietary – are presented. The emphasis of fund financial statements is on major governmental and enterprise funds, each displayed in a separate column. All remaining governmental and enterprise funds are aggregated and reported as nonmajor funds. Interfund services provided and used are not eliminated in the process of consolidation. Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Nonoperating revenues, such as subsidies and investment earnings, result from nonexchange transactions or ancillary activities. All expenses are considered to be operating expenses. The Board reports the following major governmental funds: General Fund. The General Fund is the general operating fund of the Board. The General Fund accounts for all financial resources except those that are required to be accounted for in another fund. This fund is the “Local Current Expense Fund,” which is mandated by State law [G.S. 115C-426]. State Public School Fund. The State Public School Fund includes appropriations from the Department of Public Instruction for the current operating expenditures of the public school system.


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Federal Grants Fund. The Federal Grants Fund includes appropriations from the U.S. Government for the current operating expenditures of the public school system. Restricted Revenue Fund. The Restricted Revenue Fund is used to account for revenues from reimbursements, including indirect costs, fees for actual costs, tuition, sales tax refunds, gifts and grants restricted as to use, federal and State grants restricted as to use, federal and State appropriations made directly to local school administrative units, funds received for prekindergarten programs and special programs. Capital Outlay Fund. The Capital Outlay Fund accounts for financial resources to be used for the acquisition and construction of major capital facilities (other than those financed by proprietary funds and trust funds). It is mandated by State law [G.S.115C-426]. Capital projects are funded by Richmond County appropriations, restricted sales tax moneys, proceeds of county debt issued for public school construction, lottery proceeds as well as certain State assistance. The Board reports the following nonmajor governmental funds: Individual Schools Fund. The Individual Schools Fund includes revenues and expenditures of the activity funds of the individual schools. The primary revenue sources include funds held on the behalf of various clubs and organizations, receipts from athletic events, and proceeds from various fund raising activities. The primary expenditures are for athletic teams, club programs, activity buses, and instructional needs. The Board reports the following major enterprise fund: School Food Service Fund. The School Food Service Fund is used to account for the food service program within the school system. C. Measurement Focus and Basis of Accounting Government-wide and Proprietary Fund Financial Statements. The government-wide and proprietary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Non-exchange transactions, in which the Board gives (or receives) value without directly receiving (or giving) equal value in exchange, include grants and donations. Revenue from grants and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. Governmental Fund Financial Statements. Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The Board considers all revenues reported in the governmental funds to be available if the revenues are collected within sixty days after year-end. These could include federal, State, and county grants, and some charges for services. Expenditures are recorded when the related fund liability is incurred, except for claims and judgments and compensated absences which are recognized as expenditures to the extent they have matured. General capital asset acquisitions are reported as expenditures in governmental funds. Acquisitions under capital leases are reported as other financing sources. Under the terms of grant agreements, the Board funds certain programs by a combination of specific cost-reimbursement grants and general revenues. Thus, when program expenses are incurred, there is both restricted and unrestricted net position available to finance the program. It is the Board’s policy to first apply cost-reimbursement grant resources to such programs and then general revenues.


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D. Budgetary Data The Board’s budgets are adopted as required by the North Carolina General Statutes. Annual budgets are adopted for all funds, except for the individual schools special revenue funds, as required by the North Carolina General Statutes. No budget is required by State law for individual school funds. All appropriations lapse at the fiscal year-end. All budgets are prepared using the modified accrual basis of accounting. Expenditures may not legally exceed appropriations at the purpose level for all annually budgeted funds. The Board has authorized the Superintendent to move moneys (up to $1,000) from one function to another within a fund. Amendments are required for any revisions that alter total expenditures of any fund or that change functional appropriations by more than $1,000. All amendments must be approved by the governing board. During the year, several amendments to the original budget were necessary. The budget ordinance must be adopted by July 1 of the fiscal year or the governing board must adopt an interim budget that covers that time until the annual ordinance can be adopted. E. Assets, Deferred Outflows, Liabilities, Deferred Inflows and Fund Equity

1. Deposits and Investments All deposits of the Board are made in board-designated official depositories and are secured as required by State law [G.S. 115C-444]. The Board may designate, as an official depository, any bank or savings association whose principal office is located in North Carolina. Also, the Board may establish time deposit accounts such as NOW and SuperNOW accounts, money market accounts, and certificates of deposit. The Board also has money credited in its name with the State Treasurer and may issue State warrants against these funds. State law [G.S. 115C-443] authorizes the Board to invest in obligations of the United States or obligations fully guaranteed both as to principal and interest by the United States; obligations of the State of North Carolina; bonds and notes of any North Carolina local government or public authority; obligations of certain non-guaranteed federal agencies; certain high quality issues of commercial paper and bankers' acceptances; the North Carolina Capital Management Trust (NCCMT), an SEC-registered (2a-7) money market mutual fund; and the North Carolina State Treasurer’s Short Term Investment Fund (STIF). The STIF is managed by the staff of the Department of State Treasurer and operated in accordance with State laws and regulations. It is not registered with the SEC. It consists of an internal portion and an external portion in which the Board participates. Investments are restricted to those enumerated in G.S. 147-69.1. The Board’s investments are reported at amortized cost or at fair value determined by either quoted market prices or a matrix pricing model. Bank deposits and the NCCMT are measured at amortized cost, which is the NCCMT’s share price. Ownership interest of the STIF is determined on a fair market valuation basis as of fiscal year end in accordance with the STIF operating procedures. Valuation of the underlying assets is performed by the custodian. Under the authority of G.S. 147-69.3, no unrealized gains or losses of the STIF are distributed to external participants of the fund. 2. Cash and Cash Equivalents The Board pools money from several funds to facilitate disbursement and investment and to maximize investment income. Therefore, all cash and investments are essentially demand deposits and are considered cash and cash equivalents. 3. Inventories The inventories of the Board are valued at cost and the Board uses the first-in, first-out (FIFO) flow assumption in determining cost. Proprietary Fund inventories consist of food and supplies and are recorded as expenses when consumed.


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4. Capital Assets

Donated assets received prior to June 30, 2015 are recorded at their estimated fair value at the date of donation or forfeiture. Donated capital assets received after June 30, 2015 are recorded at acquisition value. All other capital assets are recorded at original cost. Improvements are capitalized and depreciated over the remaining useful lives of the related capital assets. Certain items acquired before July 1, 1995 are recorded at an estimated original historical cost. The total of these estimates is not considered large enough that any errors would be material when capital assets are considered as a whole. For capital assets utilized in governmental activities, it is the policy of the Board to capitalize those assets costing more than $5,000 with an estimated useful life of two or more years, while for capital assets utilized in business-type activities, it is the policy of the Board to capitalize those assets costing more than $500 with an estimated useful life of two or more years. The cost of normal repairs and maintenance that do not add to the value of the asset or materially extend asset lives is not capitalized. Capital assets are depreciated using the straight-line method over the following estimated useful lives: Years Buildings and improvements 15 - 50 Equipment and furniture 3 - 10 Vehicles 6 - 12 Depreciation for assets that serve multiple purposes cannot be allocated ratably and is therefore reported as “unallocated depreciation” on the Statement of Activities. 5. Deferred outflows and 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 and so will not be recognized as an expense or expenditure until then. The Board has two items that meets this criterion – pension and other post-employment benefit-related deferrals. The statement of financial position also reports 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 and so will not be recognized as revenue until then. The Board has two items that meets this criterion – pension and other post-employment benefit-related deferrals. 6. Long-term Obligations In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities. 7. Compensated Absences The Board follows the State’s policy for vacation and sick leave. Employees may accumulate up to thirty

(30) days earned vacation leave with such leave being fully vested when earned. For the Board, the current portion of the accumulated vacation pay is not considered to be material. The Board’s liability for

accumulated earned vacation and the salary-related payments as of June 30, 2018 is recorded in the government-wide and proprietary fund financial statements on a FIFO basis. An estimate has been made based on prior years’ records of the current portion of compensated absences.


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The sick leave policy of the Board provides for an unlimited accumulation of earned sick leave. Sick leave does not vest, but any unused sick leave accumulated at the time of retirement may be used in the determination of length of service for retirement benefit purposes. Since the Board has no obligation for accumulated sick leave until it is actually taken, no accrual for sick leave has been made. 8. Net Position/Fund Balances Net Position Net position in the government-wide and proprietary fund financial statements is classified as net investment in capital assets; restricted; and unrestricted. Restricted net position represents constraints on resources that are either externally imposed by creditors, grantors, contributors, or the laws or regulations of other governments, or imposed by law through State statute. Fund Balances In the governmental fund financial statements, fund balance is composed of four classifications designed to disclose the hierarchy of constraints placed on how fund balance can be spent. The governmental fund types classify fund balances as follows: Restricted fund balance – This classification includes amounts that are restricted to specific purposes externally imposed by creditors or imposed by law.

Restricted for Stabilization by State statute - portion of fund balance that is restricted by State Statute for amounts owed to the district at year end [G.S. 115C-425(a)]. The restriction will be released as of the beginning of the subsequent fiscal year following collection of the amounts owed to the district. Restricted for school capital outlay - portion of fund balance that can only be used for school capital outlay. [G.S. 159-18 through 22] Restricted for instructional services – grant and other revenues restricted for expenditure for various instructional services, as allowable by the funding source. Restricted for individual schools – revenue sources restricted for expenditures for the various clubs and organizations, athletic events, and various fund raising activities for which they were collected.

Assigned fund balance – portion of fund balance that the Board of Education intends to use for specific purposes. The Board of Education is authorized to approve appropriations of fund balance in accordance with restrictions established by NC General Statutes.

Special revenues – portion of fund balance that represents the residual amount of revenues from certain grants, reimbursements, indirect costs and other financial resources in excess of related expenditures that will be used for instructional services, system-wide support services, ancillary services or non-programmed charges, as determined by the Board of Education.

Unassigned fund balance – the portion of fund balance that has not been restricted, committed, or assigned to specific purposes or other funds. A negative unassigned fund balance may be reported in other governmental funds if expenditures incurred for specific purposes exceeded the amounts restricted, committed or assigned to those purposes.


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The Board of Education has a management policy for revenue spending that provides guidance for programs with multiple revenue sources. The Finance Officer will pay expenditures from restricted revenue sources first, followed by assigned fund balance and lastly, unassigned fund balance. The finance officer has the authority to deviate from this policy if it is in the best interest of the Board of Education. 9. Reconciliation of Government-wide and Fund Financial Statements a. Explanation of certain differences between the governmental fund balance sheet and the

government-wide statement of net position The governmental fund balance sheet includes a reconciliation between fund balance - total governmental funds and net position – governmental activities as reported in the government-wide statement of net position. The net adjustment of $(59,535,550) consists of several elements as follows:

Description Amount

Capital assets used in governmental activities are not financial resources andare therefore not reported in the funds (total capital assets on government-wide statement in governmental activities column) 103,159,260$ Less accumulated depreciation (47,825,718) Net capital assets 55,333,542 Net OPEB asset 139,419 Deferred outflows of resources related to pensions 10,429,681 Deferred outflows of resources related to OPEB 3,632,825 Liabilities that, because they are not due and payable in the current period, donot require current resources to pay and are therefore not recorded in the fundstatements: Installment purchases (906,974) Compensated absences (3,969,117) Net pension liability (20,459,517) Net OPEB liability (76,226,640) Deferred inflows of resources related to pensions (1,022,380)

Deferred inflows of resources related to OPEB (26,486,389)

Total adjustment (59,535,550)$


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b. Explanation of certain differences between the governmental fund statement of revenues, expenditures, and changes in fund balance and the government-wide statement of activities

The governmental fund statement of revenues, expenditures, and changes in fund balances includes a reconciliation between net changes in fund balances - total governmental funds and changes in net position of governmental activities as reported in the government-wide statement of activities. There are several elements of that total adjustment of $(5,101,495) as follows:

Description Amount

Capital outlay expenditures recorded in the fund statements but capitalized asassets in the statement of activities 685,014$ Depreciation expense, the allocation of those assets over their useful lives, thatis recorded on the statement of activities but not in the fund statements (2,548,601) New debt issued during the year is recorded as a source of funds on the fundstatements; it has no effect on the statement of activities - it affects only thegovernment-wide statement of net position (431,215) Principal payments on debt owed are recorded as a use of funds on the fundstatements but affect only the statement of net position on the government-widestatements 576,693 Contributions to the pension plan in the current fiscal year are not included onthe Statement of Activities 3,947,171 Contributions to the OPEB plans in the current fiscal year are not included onthe Statement of Activities 2,266,511

Expenses reported in the Statement of Activities that do not require the use ofcurrent resources to pay are not recorded as expenditures in the fundstatements

Pension expense (5,365,658) OPEB expense (4,064,621) Loss on disposal of asset (6,222) Compensated absences are accrued in the government-wide statements but not in the fund statements because they do not use current resources (160,567)

Total adjustment (5,101,495)$

10. Defined Benefit Pension Plan and OPEB Plans For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Teachers’ and State Employees’ Retirement System (TSERS), the Retiree Health Benefit Fund (RHBF), and the Disability Income Plan of NC (DIPNC) and additions to/deductions from TSERS, RHBF, and DIPNC’s fiduciary net position have been determined on the same basis as they are reported by TSERS, RHBF, and DIPNC. For this purpose, plan member contributions are recognized in the period in which the contributions are due. The Board’s employer contributions are recognized when due and the Board has a legal requirement to provide the contributions. Benefits and refunds are recognized when due and payable in accordance with the terms of TSERS, RHBF, and DIPNC. Investments are reported at fair value.


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NOTE 2 - DETAIL NOTES ON ALL FUNDS A. Assets 1. Deposits All of the Board's deposits are either insured or collateralized by using one of two methods. Under the Dedicated Method, all deposits exceeding the federal depository insurance coverage level are collateralized with securities held by the Board's agents in the unit’s name. Under the Pooling Method, which is a collateral pool, all uninsured deposits are collateralized with securities held by the State Treasurer's agent in the name of the State Treasurer. Since the State Treasurer is acting in a fiduciary capacity for the Board, these deposits are considered to be held by the agent in the entity’s name. The amount of the pledged collateral is based on an approved averaging method for non-interest bearing deposits and the actual current balance for interest-bearing deposits. Depositories using the Pooling Method report to the State Treasurer the adequacy of their pooled collateral covering uninsured deposits. The State Treasurer does not confirm this information with the Board or with the escrow agent. Because of the inability to measure the exact amount of collateral pledged for the Board under the Pooling Method, the potential exists for under-collateralization, and this risk may increase in periods of high cash flows. However, the State Treasurer of North Carolina enforces strict standards of financial stability for each depository that collateralizes public deposits under the Pooling Method. The Board has no policy regarding custodial credit risk for deposits. At June 30, 2018, the Board had deposits with banks and savings and loans with a carrying amount of $5,280,684 and with the State Treasurer of $0. The bank balances with the financial institutions and the State Treasurer were $6,296,159 and $825,096, respectively. Of these balances, $1,087,165 was covered by federal depository insurance and $6,034,090 was covered by collateral held by authorized escrow agents in the name of the State Treasurer. 2. Investments At June 30 2018, the Board had $2,956,917 invested with the State Treasurer in the Short Term Investment Fund (STIF). The STIF is unrated and had a weighted average maturity of 1.5 years at June 30, 2018. The Board has no investment balances in the NCCMT as of June 30, 2018. The Board has no policy for managing interest rate risk or credit risk. All investments are measured using the market approach. The STIF is classified in Level 2 of the fair value hierarchy and valued using prices that are either directly or indirectly observable for an asset or liability.


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3. Accounts Receivable Receivables at the government-wide level at June 30, 2018 are as follows:

Due from (to)other funds Due from

(Internal otherbalances) governments Other Total

Governmental activities:General Fund (24,737)$ 8,240$ -$ (16,497)$ Other governmental activities 24,737 2,672,964 38,473 2,736,174

Total governmental activities -$ 2,681,204$ 38,473$ 2,719,677$

Business-type activities:School Food Service Fund -$ 123,304$ -$ 123,304$

Due from other governments consists of the following: Governmental activities: General Fund $ 8,240 Federal grant funds State Public School Fund 2,020,245 Operating funds from DPI Federal Grants Fund 214,112 Federal grant funds Capital Outlay Fund 438,607 Amounts due from County Total $ 2,681,204 Business-type activities: School Food Service Fund $ 123,304 Federal grant funds


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4. Capital Assets Capital asset activity for the year ended June 30, 2018 was as follows:

Beginning EndingBalances Increases Decreases Balances

Governmental activities:Capital assets not being depreciated:

Land 624,643$ -$ -$ 624,643$

Capital assets being depreciated:Buildings and improvements 88,518,642 19,369 - 88,538,011 Equipment and furniture 3,911,844 135,992 97,831 3,950,005 Vehicles 10,028,797 529,653 511,849 10,046,601

Total capital assets being depreciated 102,459,283 685,014 609,680 102,534,617

Less accumulated depreciation for:Buildings and improvements 35,682,508 1,714,019 - 37,396,527 Equipment and furniture 2,577,385 305,422 91,609 2,791,198 Vehicles 7,620,682 529,160 511,849 7,637,993

Total accumulated depreciation 45,880,575 2,548,601 603,458 47,825,718

Total capital assets being depreciated, net 56,578,708 54,708,899

Governmental activity capital assets, net 57,203,351$ 55,333,542$ Beginning EndingBalances Increases Decreases Balances

Business-type activities:School Food Service Fund:

Capital assets being depreciated:Equipment, furniture and vehicles 1,755,027$ 27,756$ -$ 1,782,783$

Less accumulated depreciation for:Equipment, furniture and vehicles 1,231,160 64,795 - 1,295,955

School Food Service capital assets, net 523,867$ 486,828$

Depreciation was charged to governmental functions as follows:

System-wide support services 529,160$ Unallocated depreciation 2,019,441

Total 2,548,601$


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B. Liabilities

1. Pension Plan and Other Postemployment Obligations

a. Teachers’ and State Employees’ Retirement System Plan Description. The Board is a participating employer in the statewide Teachers’ and State Employees’ Retirement System (TSERS), a cost-sharing multiple-employer defined benefit pension plan administered by the State of North Carolina. TSERS membership is comprised of employees of the State (state agencies and institutions), universities, community colleges, and certain proprietary component units along with the employees of Local Education Agencies and charter schools. Article 1 of G.S. Chapter 135 assigns the authority to establish and amend benefit provisions to the North Carolina General Assembly. Management of the plan is vested in the TSERS Board of Trustees, which consists of 13 members – nine appointed by the Governor, one appointed by the state Senate, one appointed by the state House of Representatives, and the State Treasurer and State Superintendent, who serve as ex-officio members. The Teachers’ and State Employees’ Retirement System is included in the Comprehensive Annual Financial Report (CAFR) for the State of North Carolina. The State’s CAFR includes financial statements and required supplementary information for TSERS. That report may be obtained by writing to the Office of the State Controller, 1410 Mail Service Center, Raleigh, North Carolina 27699-1410, by calling (919) 981-5454, or at www.osc.nc.gov. Benefits Provided. TSERS provides retirement and survivor benefits. Retirement benefits are determined as 1.82% of the member’s average final compensation times the member’s years of creditable service. A member’s average final compensation is calculated as the average of a member’s four highest consecutive years of compensation. General employee plan members are eligible to retire with full retirement benefits at age 65 with five years of creditable service, at age 60 with 25 years of creditable service, or at any age with 30 years of creditable service. General employee plan members are eligible to retire with partial retirement benefits at age 50 with 20 years of creditable service or at age 60 with five years of creditable service. Survivor benefits are available to eligible beneficiaries of members who die while in active service or within 180 days of their last day of service and who have either completed 20 years of creditable service regardless of age or have completed five years of service and have reached age 60. Eligible beneficiaries may elect to receive a monthly Survivor’s Alternate Benefit for life or a return of the member’s contributions. The plan does not provide for automatic post-retirement benefit increases. Increases are contingent upon actuarial gains of the plan. TSERS plan members who are LEOs are eligible to retire with full retirement benefits at age 55 with five years of creditable service as an officer, or at any age with 30 years of creditable service. LEO plan members are eligible to retire with partial retirement benefits at age 50 with 15 years of creditable service as an officer. Survivor benefits are available to eligible beneficiaries of LEO members who die while in active service or within 180 days of their last day of service and who also have either completed 20 years of creditable service regardless of age, or have completed 15 years of service as a LEO and have reached age 50, or have completed five years of creditable service as a LEO and have reached age 55, or have completed 15 years of creditable service as a LEO if killed in the line of duty. Eligible beneficiaries may elect to receive a monthly Survivor’s Alternate Benefit for life or a return of the member’s contributions. Contributions. Contribution provisions are established by General Statute 135-8 and may be amended only by the North Carolina General Assembly. Board employees are required to contribute 6% of their compensation. Employer contributions are actuarially determined and set annually by the TSERS Board of Trustees. The Board’s contractually required contribution rate for the year ended June 30, 2018, was 10.78% of covered payroll, actuarially determined as an amount that, when combined with employee contributions, is expected to finance the costs of benefits earned by employees during the year. Contributions to the pension plan from the Board were $4,110,395 for the year ended June 30, 2018.

http://www.osc.nc.gov/


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Refunds of Contributions – Board employees who have terminated service as a contributing member of TSERS, may file an application for a refund of their contributions. By state law, refunds to members with at least five years of service include 4% interest. State law requires a 60 day waiting period after service termination before the refund may be paid. The acceptance of a refund payment cancels the individual’s right to employer contributions or any other benefit provided by TSERS. At June 30, 2018, the Board reported a liability of $21,305,561 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2017. The total pension liability used to calculate the net pension asset was determined by an actuarial valuation as of December 31, 2016. The total pension liability was then rolled forward to the measurement date of June 30, 2017 utilizing update procedures incorporating the actuarial assumptions. The Board’s proportion of the net pension liability was based on a projection of the Board’s long-term share of future payroll covered by the pension plan, relative to the projected future payroll covered by the pension plan of all participating TSERS employers, actuarially determined. At June 30, 2017 and at June 30, 2016, the Board’s proportion was 0.269% and 0.275%, respectively. For the year ended June 30, 2018, the Board recognized pension expense of $5,592,424. At June 30, 2018, the Board reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred Outflows of Resources

Deferred Inflows of Resources

Differences between expected and actual experience 461,865$ 697,016$ Changes of assumptions 3,365,957 -

Net difference between projected and actual earnings on pension plan investments 2,883,365 -

Changes in proportion and differences between Board contributions and proportionate share of contributions 39,388 367,641 Board contributions subsequent to the measurement date 4,110,395 - Total 10,860,970$ 1,064,657$ $4,110,395 reported as deferred outflows of resources related to pensions resulting from Board contributions subsequent to the measurement date will be recognized as a decrease of the net pension liability in the year ended June 30, 2019. Other amounts reported as deferred inflows of resources related to pensions will be recognized in pension expense as follows: Year ended June 30:

2019 1,019,739$ 2020 3,960,646 2021 1,859,488 2022 (1,153,954) Total 5,685,919$

Actuarial Assumptions. The total pension liability in the December 31, 2016 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement:


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Inflation 3.0 percentSalary increases 3.5 to 8.1 percent, including inflation and

productivity factorInvestment rate of return 7.20 percent, net of pension plan investment

expense, including inflation The plan currently uses mortality tables that vary by age, gender, employee group (i.e. general, law enforcement officer) and health status (i.e. disabled and healthy). The current mortality rates are based on published tables and based on studies that cover significant portions of the U.S. population. The healthy mortality rates also contain a provision to reflect future mortality improvements. The actuarial assumptions used in the December 31, 2016 valuation were based on the results of an actuarial experience study for the period January 1, 2010 through December 31, 2014. Future ad hoc COLA amounts are not considered to be substantively automatic and are therefore not included in the measurement. The projected long-term investment returns and inflation assumptions are developed through review of current and historical capital markets data, sell-side investment research, consultant whitepapers, and historical performance of investment strategies. Fixed income return projections reflect current yields across the U.S. Treasury yield curve and market expectations of forward yields projected and interpolated for multiple tenors and over multiple year horizons. Global public equity return projections are established through analysis of the equity risk premium and the fixed income return projections. Other asset categories and strategies’ return projections reflect the foregoing and historical data analysis. These projections are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class as of June 30, 2017 are summarized in the following table:

Asset Class Target AllocationLong-Term Expected Real

Rate of ReturnFixed Income 29.0% 1.4%Global Equity 42.0% 5.3%Real Estate 8.0% 4.3%Alternatives 8.0% 8.9%Credit 7.0% 6.0%Inflation Protection 6.0% 4.0% Total 100%

The information above is based on 30 year expectations developed with the consulting actuary for the 2017 asset liability and investment policy study for the North Carolina Retirement Systems, including TSERS. The long-term nominal rates of return underlying the real rates of return are arithmetic annualized figures. The real rates of return are calculated from nominal rates by multiplicatively subtracting a long-term inflation assumption of 3.05%. All rates of return and inflation are annualized. Discount rate. The discount rate used to measure the total pension liability was 7.20%. 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 statutorily required rates, actuarially determined. Based on these assumptions, the pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of the 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.


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Sensitivity of the County’s proportionate share of the net pension asset to changes in the discount rate. The following presents the Board’s proportionate share of the net pension liability calculated using the discount rate of 7.20 percent, as well as what the Board’s proportionate share of the net pension asset or net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.20 percent) or 1-percentage point higher (8.20 percent) than the current rate:

1% Decrease (6.20%)

Discount Rate (7.20%)

1% Increase (8.20%)

Board's proportionate share of the net pension liability (asset) 43,855,664$ 21,305,561$ 2,411,449$ Pension plan fiduciary net position. Detailed information about the pension plan’s fiduciary net position is available in the separately issued Comprehensive Annual Financial Report (CAFR) for the State of North Carolina. b. Other Postemployment Benefits

1. Healthcare Benefits Plan description. The Retiree Health Benefit Fund (RHBF) has been established as a fund to provide health benefits to retired and disabled employees and their applicable beneficiaries. RHBF is established by General Statute 135-7, Article 1. It is a cost-sharing, multiple-employer, defined benefit healthcare plan, exclusively for the benefit of former employees of the State, the University of North Carolina System, and community colleges. In addition, LEAs, charter schools, and some select local governments also participate. Management of the plan is vested in the State Health Plan Board of Trustees, which consists of 13 members – eight appointed by the Governor, one appointed by the State Senate, one appointed by the State House of Representatives, and the State Treasurer the State Superintendent and the Director of the Office of State Human Resources who serve as ex-officio members. RHBF is supported by a percent of payroll contribution from participating employing units. Each year the percentage is set in legislation, as are the maximum per retiree contributions from RHBF to the State Health Plan. The State Treasurer, with the approval of the State Health Plan Board of Trustees, then sets the employer contributions (subject to the legislative cap) and the premiums to be paid by retirees, as well as the health benefits to be provided through the State Health Plan. The financial statements and other required disclosures for the plan are presented in the State of North Carolina’s CAFR, which can be found at https://www.osc.nc.gov/public-information/reports. Benefits provided. Plan benefits received by retired employees and disabled employees from RHBF are OPEB. The healthcare benefits for retired and disabled employees who are not eligible for Medicare are the same as for active employees. The plan options change when former employees become eligible for Medicare. Medicare retirees have the option of selecting one of two fully-insured Medicare Advantage/Prescription Drug Plan (MA-PDP) options of the self-funded Traditional 70/30 preferred Provider Organization plan option that is also offered to non-Medicare members. If the Traditional 70/30 Plan is selected by a Medicare retiree, the self-funded State Health Plan coverage is secondary to Medicare. Those former employees who are eligible to receive medical benefits from RHBF are long-term disability beneficiaries of the Disability Income Plan of North Carolina (DIPNC) and retirees of the TSERS, the Consolidated Judicial Retirement System (CJRS), the Legislative Retirement System (LRS), the University Employees’ Optional Retirement Program (ORP), and a small number of local governments, with five or more years of contributory membership service in their retirement system prior to disability or


38

retirement, with the following exceptions: for employees first hired on or after October 1, 2006, and members of the General Assembly first taking office on or after February 1, 2007, future coverage as retired employees and retired members of the General Assembly is subject to the requirement that the future retiree have 20 or more years of retirement service credit in order to receive coverage on a noncontributory basis. Employees first hired on or after October 1, 2006 and members of the General Assembly first taking office on or after February 1, 2007 with 10 but less than 20 years of retirement service credit are eligible for coverage on a partially contributory basis. For such future retirees, the State will pay 50% of the State Health Plan’s noncontributory premium. Section 35.21 (c) and (d) of Session Law 2017-57 repeals retiree medical benefits for employees first hired January 1, 2021. The new legislation amends Article 3B of Chapter 135 of the General Statutes to require that retirees must earn contributory retirement service in TSERS (or in an allowed local system unit), CJRS, or LRS prior to January 1, 2021, and not withdraw that service, in order to be eligible for retiree medical benefits under the amended law. Consequently, members first hired on and after January 1, 2021 will not be eligible to receive retiree medical benefits. RHBF’s benefit and contribution provisions are established by Chapter 135-7, Article 1 and Chapter 135, Article 3B of the General Statutes and may be amended only by the North Carolina General Assembly. RHBF does not provide for automatic post-retirement benefit increases. Contributions. By General Statute, accumulated contributions from employers to RHBF and any earnings on those contributions shall be used to provide health benefits to retired and disabled employees and their applicable beneficiaries. By statute, contributions to RHBF are irrevocable. Also by law, fund assets are dedicated to providing benefits to retired and disabled employees and their applicable beneficiaries and are not subject to the claims of creditors of the employers making contributions to RHBF. However, RHBF assets may be used for reasonable expenses to administer the RHBF, including costs to conduct required actuarial valuations of state—supported retired employees’ health benefits. Contribution rates to RHBF, which are intended to finance benefits and administrative expenses on a pay-as-you-go basis are determined by the General Assembly in the Appropriations Bill. For the current fiscal year, the Board contributed 6.05% of covered payroll which amounted to $2,306,854. At June 30, 2018, the Board reported a liability of $79,378,771 for its proportionate share of the RHBF net OPEB liability. The net OPEB liability was measured as of June 30, 2017, and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation as of December 31, 2016. The total OPEB liability was then rolled forward to the measurement date of June 30, 2017 utilizing update procedures incorporating the actuarial assumptions. The Board’s proportion of the net OPEB liability was based on a projection of the Board’s present value of future salary, actuarially determined. At June 30, 2017 and 2016, the Board’s proportion was 0.242% and 0.238%, respectively. $2,306,854 reported as deferred outflows of resources related to OPEB resulting from Board contributions subsequent to the measurement date will be recognized as a decrease of the net OPEB liability in the year ending June 30, 2019. Other amounts reported as deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: Year ended June 30:

2019 (5,247,993)$ 2020 (5,247,993) 2021 (5,247,993) 2022 (5,247,993) 2023 (5,240,618) Total (26,232,590)$


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Actuarial assumptions. Common actuarial assumptions for both OPEB plans follow individual note disclosures for each OPEB plan. Inflation 2.75%Salary increases

Investment rate of return

Healthcare cost trend rate - medical 5.00-6.50%Healthcare cost trend rate - prescription drug 5.00-7.25%Healthcare cost trend rate -Medicare advantage 4.00-5.00%Healthcare cost trend rate - administrative 3.00%

7.20%, net of OPEB plan investment expense, including inflation

3.50-8.10%, include 3.5% inflation and productivity factor

Discount rate. The discount rate used to measure the total OPEB liability for the RHBF was 3.58%. The projection of cash flow used to determine the discount rate assumed that contributions from employers would be made at the current statutorily determined contribution rate. Based on the above assumptions, the plan’s fiduciary net position was not projected to be available to make projected future benefit payments of current plan members. As a result, a municipal bond rate of 3.58% was used as the discount rate used to measure the total OPEB liability. The 3.58% rate is based on the Bond Buyer 20-year General Obligation Index as of June 30, 2017. Sensitivity of the Board’s proportionate share of the net OPEB liability to changes in the discount rate. The following presents the Board’s proportionate share of the net OPEB liability, as well as what the District’s proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage point lower (2.58 percent) or 1-percentage point higher (4.58 percent) than the current discount rate:

1% decrease Discount Rate 1% Increase (2.58%) (3.58%) (4.58%)

Net OPEB liability 94,694,314$ 79,378,771$ 67,231,371$ Sensitivity of the Board’s proportionate share of the net OPEB liability to changes in the healthcare trend rates. The following presents the Board’s proportionate share of the net OPEB liability, as well as what the District’s proportionate share of the net OPEB liability would be if it were calculated using a discount rate that is 1-percentage point lower (2.58 percent) or 1-percentage point higher (4.58 percent) than the current discount rate:

1% Decrease (Medical - 4.00-5.50%, Pharmacy - 4.00-6.25%, Medicare

Advantage - 3.00-4.00%, Administrative - 2.00%)

Healthcare Trend Rates (Medical -5.00-6.50%,

Pharmacy - 5.00-7.25%, Medicare Advantage - 4.00-

5.00%, Administrative - 3.00%)

1% increase (Medical -6.00-7.50%, Pharmacy - 6.00-

8.25%, Medicare Advantage - 5.00-6.00%, Administrative - 4.00%)

Net OPEB liability $ 64,845,145 79,378,771$ 98,695,817$ OPEB plan fiduciary net position. Detailed information about the OPEB plan’s fiduciary net position is available in the separately issued CAFR for the State of North Carolina.


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2. Disability Benefits Plan description. Short-term and long-term disability benefits are provided through the Disability Income Plan of North Carolina (DIPNC), a cost-sharing, multiple-employer defined benefit plan, to the eligible members of TSERS which includes employees of the State, the University of North Carolina System, community colleges, certain Local Education Agencies, and ORP. Management of the plan is vested in the State Health Plan Board of Trustees, which consists of 13 members – eight appointed by the Governor, one appointed by the State Senate, one appointed by the State House of Representatives, and the State Treasurer the State Superintendent and the Director of the Office of State Human Resources who serve as ex-officio members. Management of the plan is vested in the State Health Plan Board of Trustees, which consists of 13 members – eight appointed by the Governor, one appointed by the State Senate, one appointed by the State House of Representatives, and the State Treasurer the State Superintendent and the Director of the Office of State Human Resources who serve as ex-officio members. The financial statements and other required disclosures for the plan are presented in the State of North Carolina’s CAFR, which can be found at https://www.osc.nc.gov/public-information/reports. Benefits Provided. Long-term disability benefits are payable as an OPEB from DIPNC after the conclusion of the short-term disability period or after salary continuation payments cease, whichever is later, for as long as an employee is disabled. An employee is eligible to receive long-term disability benefits provide the following requirements are met: (1) the employee has five or more years of contributing membership service in TSERS or ORP, earned within 96 months prior to the end of the short-term disability period or cessation of salary continuation payments, whichever is later; (2) the employee must make application to receive long-term benefits within 180 days after the conclusion of the short-term disability period or after salary continuation payments cease or after monthly payments for Workers’ Compensation cease (excluding monthly payments for permanent partial benefits), whichever is later; (3) the employee must be certified by the Medical Board to be mentally or physically disabled for the further performance of his/her usual occupation; (4) the disability must have been continuous, likely to be permanent, and incurred at the time of active employment; (5) the employee must not be eligible to receive an unreduced retirement benefit from TSERS after (1) reaching the age of 65 and completing 5 years of membership service, or (2) reaching the age of 60 and completing 25 years of creditable service, or (3) completing 30 years of service at any age. Contributions. Benefit and contribution provisions are established by Chapter 135, Article 6, of the General Statutes and may be amended only by the North Carolina General Assembly. The plan does not provide for automatic post-retirement benefit increases. Disability income benefits are funded by actuarially determined employer contributions that are established in the Appropriations Bill by the General Assembly and coincide with the State fiscal year. For the fiscal year ended June 30, 2018, employers made a statutory contribution of 0.14% of covered payroll which was equal to the actuarially required contribution. Board contributions to the plan were $53,382 for the year ended June 30, 2018. The contributions cannot be separated between the amounts that relate to other postemployment benefits and employment benefits for active employees. Those individuals who are receiving extended short-term disability benefit payments cannot be separated from the number of members currently eligible to receive disability benefits as an other postemployment benefit. At June 30, 2018, the Board reported an asset of $145,184 for its proportionate share of the DIPNC net OPEB asset. The net OPEB asset was measured as of June 30, 2017, and the total OPEB liability used to calculate the net OPEB asset was determined by an actuarial valuation as of December 31, 2016. The total OPEB liability was then rolled forward to the measurement date of June 30, 2017 utilizing update procedures incorporating the actuarial assumptions. The Board’s proportion of the net OPEB


41

asset was based on a projection of the Board’s present value of future salary, actuarially determined. At June 30, 2017 and 2016, the Board’s proportion was 0.238% and 0.246%, respectively. $53,382 reported as deferred outflows of resources related to OPEB resulting from Board contributions subsequent to the measurement date will be recognized as an increase of the net OPEB asset in the year ending June 30, 2019. Other amounts reported as deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: Year ended June 30:

2019 21,935$ 2020 21,935 2021 21,928 2022 7,950 Total 73,748$

Actuarial assumptions. Common actuarial assumptions for both OPEB plans follow individual note disclosures for each OPEB plan. Inflation 3.00%Salary increases 3.5%-8.10%, include 3.5% inflation and productivity factorInvestment rate of return 3.75%, net of OPEB plan expense, including inflation

Sensitivity of the Board’s proportionate share of the net OPEB asset to changes in the discount rate. The following presents the Board’s proportionate share of the net OPEB asset, as well as what the District’s proportionate share of the net OPEB asset would be if it were calculated using a discount rate that is 1-percentage point lower (2.75 percent) or 1-percentage point higher (4.75 percent) than the current discount rate:

1% Decrease Discount Rate 1% Increase (2.75%) (3.75%) (4.75%)

Net OPEB asset 123,428$ 145,184$ 166,991$ Common actuarial assumptions for both OPEB plans. The total OPEB liability was determined by an actuarial valuation performed as of December 31, 2016 using the following actuarial assumptions, applied to all periods in the measurement, unless otherwise specified. The total OPEB liability was calculated through the use of update procedures to roll forward from the actuarial valuation date to the measurement date of June 30, 2017. The update procedures incorporated the actuarial assumptions used in the valuation. The entry age normal cost method was utilized. The plan currently uses mortality tables that vary by age, gender, employee group (i.e. teacher, general, law enforcement officer), and health status (i.e. disabled and healthy). The current mortality rates are based on published tables and based on studies that cover significant portions of the U.S. population. The mortality rates also contain a provision to reflect future mortality improvements. The actuarial assumptions were based on the results of an actuarial experience review for the period January 1, 2010 through December 31, 2014. The long-term expected rate of return on OPEB plan investments was determined using a building-block method in which best estimate ranges of expected future real rates of return are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation and by adding expected


42

inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset Class Target AllocationLong-Term Expected Real

Rate of ReturnFixed Income 29% 1.4%Global Equity 42% 5.3%Real Estate 8% 4.3%Alternatives 8% 8.9%Opportunistic Fixed Income 7% 6.0%Inflation Sensitive 6% 4.0%Total 100% Following is information related to OPEB expense, proportionate share, assets, liabilities, deferred outflows of resources and deferred inflows of resources reported by the Board as of and for the year ended June 30, 2018:

RHBF DIPNC TotalOPEB expense 4,205,280$ 77,842$ 4,283,122$ OPEB liability (asset) 79,378,771 (145,184) 79,233,587 Proportionate share of the net OPEB liability (asset) 0.24210% 0.23750%

Deferred Outflows of Resources:Differences between expected and actual experience - 39,807 39,807 Net difference between projected and actual earnings on plan investments - 31,823 31,823 Changes in proportion and differences between Board contributions and proportionate share of contributions 1,349,065 2,118 1,351,183 Board contributions subsequent to the measurement date 2,306,854 53,382 2,360,236

Deferred Inflows of Resources:Differences between expected and actual experience 5,691,604 - 5,691,604 Changes of assumptions 21,860,551 - 21,860,551 Net difference between projected and actual earnings on plan investments 29,501 - 29,501


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2. Accounts Payable Accounts payable as of June 30, 2018 are as follows:

Vendorsand Other

Governmental activities:General Fund 262,285$ Other governmental activities 12

Total governmental activities 262,297$

3. Unearned Revenues The balance in unearned revenues at year-end is composed of the following elements: Business-type activities: Prepayments of meals (School Food Service Fund) $ 10,761 4. Deferred Outflows and Inflows of Resources The balances in deferred outflows and inflows of resources at year-end are composed of the following:

Deferred Outflows of Resources

Deferred Inflows of Resources

Differences between expected and actual experience 501,672$ 6,388,620$ Changes of assumptions 3,365,957 21,860,551

Net difference between projected and actual earnings on pension and OPEB plan investments 2,915,188 29,501

Changes in proportion and differences between Board contributions and proportionate share of contributions 1,390,571 367,641 Board contributions subsequent to the measurement date 6,470,631 - Total 14,644,019$ 28,646,313$ 5. Risk Management

The Board is exposed to various risks of losses related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. Through commercial companies, the Board maintains general liability and errors and omissions insurance coverage of $1 million per claim and an aggregate limit of $2 million. Statutory workers’ compensation coverage is

purchased through a private insurer for employees to the extent they are paid from Federal and local funds. Workers’ compensation coverage is provided by the State of North Carolina through a self-insured fund, to the extent employees are paid from State funds. Business property insurance is also purchased through commercial companies. The policy coverage insures the tangible property assets of the Board. Buildings and contents are insured on an agreed value basis. The Board carries additional flood insurance coverage of $5 million purchased through commercial companies.


44

The Board also participates in the Teachers’ and State Employees’ Comprehensive Major Medical Plan,

a self-funded risk financing pool of the State administered by Blue Cross and Blue Shield of North Carolina. Through the Plan, permanent full-time employees of the Board are eligible to receive health care benefits. The Board pays the full cost of coverage for employees enrolled in the Comprehensive Major Medical Plan. In accordance with G.S. 115C-442, the Board’s employees who have custody of the Board’s monies at

any given time are performance bonded through a commercial surety bond. The finance officer is bonded for $100,000. The remaining employees that have access to funds are bonded under a blanket bond for $100,000. The Board carries commercial coverage for all other risks of loss. There have been no significant reductions in insurance coverage in the prior year, and claims have not exceeded coverage in any of the past three fiscal years. 6. Long-Term Obligations a. Installment Purchases The Board is authorized to finance the purchase of school buses under G.S. 115C-528(a). Session law 2003-284, section 7.25 authorized the State Board of Education to allot monies for the payments on financing contracts entered into pursuant to G.S. 115C-528. The State has accepted the bid to purchase Thomas Built Buses through special third party financing arrangements. The Board entered into such financing contracts for the purchase of school buses during the 2014-2015 through 2017-2018 fiscal years. The original amount of the installment purchase contracts outstanding at June 30, 2018 totaled $1,809,981. The contracts require four equal principal-only payments with the first payment due within 10 days of receipt of the buses and the following 3 payments due on the next 3 immediately following November 15th dates. The future minimum payments of the installment purchases as of June 30, 2018 are as follows: Governmental Activities Year Ending June 30: Principal 2019 $ 452,495 2020 346,676 2021 107,803 Total $ 906,974


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b. Long-Term Obligation Activity

The following is a summary of changes in the Board’s long-term obligations for the fiscal year ended June 30, 2018:

CurrentJuly 1, 2017 Increases Decreases June 30, 2018 Portion

Governmental activities:Installment purchases 1,052,452$ 431,215$ 576,693$ 906,974$ 452,495$ Net pension liability 24,250,814 - 3,791,297 20,459,517 - Net OPEB liability 99,543,738 - 23,317,098 76,226,640 - Compensated absences 3,808,550 2,909,214 2,748,647 3,969,117 2,864,529

Total 128,655,554$ 3,340,429$ 30,433,735$ 101,562,248$ 3,317,024$

Business-type activities:Net pension liability 990,520$ -$ 144,476$ 846,044$ -$ Net OPEB liability 4,065,847 - 913,716 3,152,131 - Compensated absences 141,640 124,824 116,269 150,195 123,292

Total 5,198,007$ 124,824$ 1,174,461$ 4,148,370$ 123,292$ Compensated absences, net pension and net OPEB liabilities related to governmental activities are typically liquidated by the General and other governmental funds. Installment purchases are typically liquidated by the Capital Outlay Fund. C. Interfund Balances and Activity 1. Transfers to/from other Funds Transfers to/from other funds during the year ended June 30, 2018 consisted of the following: From the State Public School Fund to the School Food Service Fund for administrative costs $ 45,000

2. Interfund Balances The composition of interfund balances as of June 30, 2018 is as follows: Receivable Fund Payable Fund Amount Individual Schools Fund General Fund $ 24,737 The amount due to the Individual Schools Fund from the General Fund is for STIF deposits held. These balances are expected to be repaid by June 30, 2019.


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D. Fund Balance The following schedule provides management and citizens with information on the portion of General fund balance that is available for appropriation.

Total fund balance - General Fund 3,278,881$ Less:

Stabilization by State statute (8,240) Restricted for instructional services (28,951) Appropriated fund balance in 2018-2019 budget (2,483,542)

Remaining fund balance 758,148$

NOTE 3 – RESTRICTED REVENUE FUND – OTHER REVENUES

Other revenues for the fiscal year ended June 30, 2018 in the Restricted Revenue Fund consists of the following:

Private grants and programs 161,829$ Medicaid reimbursement program 328,175 Other 140,795

Total other revenues 630,799$

NOTE 4 - SUMMARY DISCLOSURE OF SIGNIFICANT CONTINGENCIES Federal and State Assisted Programs The Board has received proceeds from several federal and State grants. Periodic audits of these grants are required and certain costs may be questioned as not being appropriate expenditures under the grant agreements. Such audits could result in the refund of grant moneys to the grantor agencies. Management believes that any required refunds will be immaterial. No provision has been made in the accompanying financial statements for the refund of grant moneys.

NOTE 5 – CHANGE IN ACCOUNTING PRINCIPLES/RESTATEMENT

The Board implemented Governmental Accounting Standards Board (GASB) statement 75, Accounting

and Financial Reporting for Postemployment Benefits Other Than Pensions, in the fiscal year ending June 30, 2018. The implementation of the statement required the Board to record beginning net OPEB liability and Net OPEB asset and the effects on net position from contributions made by the Board during the measurement period (fiscal year end June 30, 2017). As a result, net position for the governmental and business-type activities decreased by $97,142,674 and $3,966,633, respectively.

RICHMOND COUNTY BOARD OF EDUCATION

SCHEDULE OF THE BOARD'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY

TEACHERS' AND STATE EMPLOYEES' RETIREMENT SYSTEM

2018 2017 2016 2015 2014

Board's proportion of the net pension liability (asset) 0.269% 0.275% 0.270% 0.271% 0.276%

21,305,561$ 25,241,334$ 9,964,775$ 3,178,433$ 16,768,154$

Board's covered payroll 38,072,480$ 35,175,224$ 37,313,093$ 35,729,298$ 37,050,126$

55.96% 71.76% 26.71% 8.90% 45.26%

89.51% 87.32% 94.64% 98.24% 90.60%

* The amounts presented for each fiscal year were determined as of the prior fiscal year ending June 30.

SCHEDULE OF REQUIRED SUPPLEMENTARY INFORMATION

LAST FIVE FISCAL YEARS*

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

Plan fiduciary net position as a percentage of the totalpension liability

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

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Note: This is a ten year schedule. However, GASB 68 was not adopted until the fiscal year ended June 30, 2015. Therefore, there are only five yearsof data presented.


TEACHERS' AND STATE EMPLOYEES' RETIREMENT SYSTEM

2018 2017 2016 2015 2014

Contractually required contribution 4,110,395$ 3,799,634$ 3,218,533$ 3,414,148$ 3,104,876$

4,110,395 3,799,634 3,218,533 3,414,148 3,104,876

Contribution deficiency (excess) -$ -$ -$ -$ -$


10.78% 9.98% 9.15% 9.15% 8.69%

SCHEDULE OF BOARD CONTRIBUTIONS

LAST FIVE FISCAL YEARS

Contributions in relation to the contractually required contribution

Contributions as a percentage of covered payroll


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Note: This is a ten year schedule. However, GASB 68 was not adopted until the fiscal year ended June 30, 2015. Therefore, there are only five yearsof data presented.


SCHEDULE OF THE BOARD'S PROPORTIONATE SHARE OF THE NET OPEB LIABILITY

RETIREE HEALTH BENEFIT FUND

2018 2017

Board's proportion of the net OPEB liability (asset) 0.242% 0.238%

79,378,771$ 103,609,585$

Board's covered payroll 38,072,480$ 35,175,224$

208.49% 294.55%

3.52% 2.41%


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LAST TWO FISCAL YEARS*

Board's proportionate share of the net OPEB liability(asset)

Board's proportionate share of the net OPEB liability(asset) as a percentage of its covered payroll

Plan fiduciary net position as a percentage of the totalOPEB liability

Note: This is a ten year schedule. However, GASB 75 was not adopted until the fiscal year ended June 30, 2018. Therefore, there are only two yearsof data presented.


RETIREE HEALTH BENEFIT FUND

2018 2017 2016 2015 2014


2,306,854 2,202,889 2,063,968 2,031,141 1,914,153



6.05% 5.81% 5.60% 5.49% 5.40%

2013 2012 2011 2010 2009


1,959,771 1,834,550 1,879,523 1,805,779 1,734,501



5.30% 5.00% 4.90% 4.50% 4.10%Contributions as a percentage of covered payroll

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LAST TEN FISCAL YEARS





SCHEDULE OF THE BOARD'S PROPORTIONATE SHARE OF THE NET OPEB ASSET

DISABILITY INCOME PLAN OF NORTH CAROLINA

2018 2017

Board's proportion of the net OPEB asset 0.238% 0.246%

145,184$ 152,716$

Board's covered payroll 38,072,480$ 35,175,224$

0.38% 0.43%

116.23% 116.06%


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LAST TWO FISCAL YEARS*

Board's proportionate share of the net OPEB asset

Board's proportionate share of the net OPEB asset as apercentage of its covered payroll

Plan fiduciary net position as a percentage of the totalOPEB asset

Note: This is a ten year schedule. However, GASB 75 was not adopted until the fiscal year ended June 30, 2018. Therefore, there are only two yearsof data presented.


DISABILITY INCOME PLAN OF NORTH CAROLINA

2018 2017 2016 2015 2014

Contractually required contribution 53,382$ 144,079$ 151,112$ 151,688$ 155,968$

53,382 144,079 151,112 151,688 155,968



0.14% 0.38% 0.41% 0.41% 0.44%

2013 2012 2011 2010 2009

Contractually required contribution 162,698$ 190,793$ 199,460$ 208,668$ 219,986$

162,698 190,793 199,460 208,668 219,986



0.44% 0.52% 0.52% 0.52% 0.52%

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LAST TEN FISCAL YEARS





GENERAL FUND

VarianceFinal Positive

Budget Actual (Negative)

Revenues:Richmond County:

County appropriation 7,763,448$ 7,763,448$ -$

U.S. Government:ROTC 90,000 90,633 633

Other:Fines and forfeitures 175,000 162,228 (12,772) Interest earned on investment 20,000 32,074 12,074 Indirect costs allocated 325,000 250,085 (74,915) Rental of school property 20,000 1,275 (18,725) Refunds and reimbursements 120,000 532,010 412,010 Miscellaneous - 11,579 11,579

Total other 660,000 989,251 329,251

Total revenues 8,513,448 8,843,332 329,884

Expenditures: Current:

Instructional services:Regular instructional 1,294,099 Special populations 110,239 Alternative programs 56,361 School leadership 309,816 Co-curricular 41,157 School-based support 278,554

Total instructional services 3,911,427 2,090,226 1,821,201

System-wide support services:Support and development 1,185,703 Operational support 4,389,368 Financial and human resource services 799,288 Accountability 5,490 Policy, leadership and public relations 362,729

Total system-wide support services 6,947,063 6,742,578 204,485

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE -

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BUDGET AND ACTUAL


GENERAL FUND



Expenditures: (Continued) Current:

Ancillary services:Community 109,000 71,529 37,471

Non-programmed charges:Payments to other governments 29,500 22,631 6,869

Total expenditures 10,996,990 8,926,964 2,070,026

Revenues over (under) expenditures (2,483,542) (83,632) 2,399,910

Fund balance appropriated 2,483,542 - (2,483,542)

Net change in fund balance -$ (83,632) (83,632)$

Fund balance:Beginning of year 3,362,513



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BUDGET AND ACTUAL (Continued)




Revenues:State of North Carolina:

State Buses Appropriation 576,693$ 576,693$ -$

Richmond County:Restricted portion of sales tax 2,005,500 1,976,180 (29,320) General county revenues 423,500 423,500 -

Total Richmond County 2,429,000 2,399,680 (29,320) Other:

Interest earned on investments - 10,392 10,392 Miscellaneous - 3,997 3,997

Total other - 14,389 14,389

Total revenues 3,005,693 2,990,762 (14,931)

Expenditures:Debt service:

Principal retirement 576,693 576,693 -

Current:System-wide support services:

Operational support 678,215 644,925 33,290

Capital outlay:Real property, buildings and improvements 2,062,030 Furnishings and equipment 77,606

Total capital outlay 2,182,000 2,139,636 42,364

Total expenditures 3,436,908 3,361,254 75,654

Revenues over (under) expenditures (431,215) (370,492) 60,723 Other financing sources:

Installment purchase obligations issued 431,215 431,215 -

Net change in fund balance -$ 60,723 60,723$

Fund balance:Beginning of year 2,002,469



CAPITAL OUTLAY FUND


BUDGET AND ACTUAL

56




Operating revenues - food sales 457,812$ 396,597$ (61,215)$

Operating expenditures:Business support services:Purchase of food 1,575,056 Donated commodities 316,854 Salaries and benefits 2,507,292 Indirect costs 160,000 Materials and supplies 193,619 Repairs and maintenance 12,486 Non-capitalized equipment 5,311 Contracted services 18,728 Other 31,488

Capital outlay 27,756

Total operating expenditures 5,038,681 4,848,590 190,091

Operating loss (4,580,869) (4,451,993) 128,876

Nonoperating revenues:Federal reimbursements and grants 4,238,869 4,228,744 (10,125) Federal commodities 297,000 316,854 19,854

Total nonoperating revenues 4,535,869 4,545,598 9,729

Excess of revenues over expendituresExcess of revenues over (under) expendituresbefore other financing sources (45,000) 93,605 138,605

Other financing sources:Transfers from other funds 45,000 45,000 -

Net change in fund balance -$ 138,605 138,605$

Reconciliation of modified accrual to fullaccrual basis:Reconciling items:Depreciation (64,795) Net OPEB asset (228) Net pension liability 144,476 Net OPEB liability 913,716 Deferred outflows - pension (162,308) Deferred inflows - pension (1,083,976) Equipment purchases 27,756 Increase in compensated absences payable (8,555) Decrease in inventories (8,049)

(103,358)$ Change in net position (full accrual)


SCHOOL FOOD SERVICE FUNDFor the Fiscal Year Ended June 30, 2018

SCHEDULE OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL (NON-GAAP)

57

Statistical Section

Page 59

STATISTICAL SECTION (Unaudited)

The Statistical Section of the District’s Comprehensive Annual Financial Report (CAFR)

presents detailed information as a context for understanding what the information in the financial

statements, note disclosures, and required supplementary information say about the District’s

overall financial outlook.

Sections

Financial Trends

These schedules contain trend information to help the reader understand how the

District’s financial performance and operations have changed over time.

Operating Information

These schedules contain service data to help the reader understand how the information

in the District’s financial report relates to the services the District provides and the

activities it performs.

Demographic and Economic Information

These schedules offer demographic and economic indicators to help the reader

understand the environment within which the District’s financial activities take place.

County information is included.

Debt Capacity

Since the District has no tax-levying or debt-issuing authority, the County of Richmond

provides significant funding to the school system. Selected fiscal data from the County

of Richmond has been included to help the reader better understand the school system

and its financial operations.

Revenue Capacity

Since the District’s local revenues are primarily provided by Richmond County, these

schedules on the county’s revenue sources are relevant to an understanding of Richmond

County’s most significant local revenue source, the property tax.

Table 1

State of North Carolina 49,900,548$ Instructional services 56,823,832$ Richmond County 10,163,128 System-wide support services 16,071,541 Federal 6,514,280 Ancillary services 99,100 School food service 4,942,195 Payments to other governments 22,631 Other 3,310,194 Unallocated depreciation 2,019,441

School food service 5,090,553

Total revenue sources 74,830,345$ Total expenses 80,127,098$

Financial Perspective

Governmental and Business-type Activities

For Year Ended June 30, 2018


State of NorthCarolina

RichmondCounty

Federal

School foodservice

Other

Revenue Sources

Instructionalservices

System-widesupport services

Ancillary services

Payments to othergovernmentsUnallocated

depreciationSchool foodservice

Expenses

Page 61

Table 2

Year Ended June 30 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Governmental activities:Net investment in capital assets 56,271,886$ 65,137,937$ 63,716,109$ 62,503,032$ 61,758,314$ 60,548,916$ 59,071,879$ 57,396,188$ 56,150,899$ 54,426,568$ Restricted 618,884 655,975 2,772,148 3,397,800 2,571,027 2,284,979 2,916,128 3,857,716 3,704,542 3,940,616 Unrestricted (deficit) 1,168,744 2,250,452 2,252,246 2,179,947 1,201,039 1,218,893 (10,593,163) (9,111,087) (9,837,354) (110,685,166)

58,059,514$ 68,044,364$ 68,740,503$ 68,080,779$ 65,530,380$ 64,052,788$ 51,394,844$ 52,142,817$ 50,018,087$ (52,317,982)$

Business-type activities:Invested in capital assets 137,050$ 134,118$ 115,829$ 169,239$ 183,744$ 234,446$ 235,130$ 409,812$ 523,867$ 486,828$ Restricted - - - - - - - - - 10,813 Unrestricted (deficit) 183,996 592,989 810,693 806,188 525,978 781,898 446,865 482,364 498,753 (3,545,012)

321,046$ 727,107$ 926,522$ 975,427$ 709,722$ 1,016,344$ 681,995$ 892,176$ 1,022,620$ (3,047,371)$

District-wide:Net investment in capital assets 56,408,936$ 65,272,055$ 63,831,938$ 62,672,271$ 61,942,058$ 60,783,362$ 59,307,009$ 57,806,000$ 56,674,766$ 54,913,396$ Restricted 618,884 655,975 2,772,148 3,397,800 2,571,027 2,284,979 2,916,128 3,857,716 3,704,542 3,951,429 Unrestricted (deficit) 1,352,740 2,843,441 3,062,939 2,986,135 1,727,017 2,000,791 (10,146,298) (8,628,723) (9,338,601) (114,230,178)

58,380,560$ 68,771,471$ 69,667,025$ 69,056,206$ 66,240,102$ 65,069,132$ 52,076,839$ 53,034,993$ 51,040,707$ (55,365,353)$

Source: Richmond County Board of Education, North Carolina, Annual Financial Reports.

Note: Net position for 2014 and before are not comparable to 2015 (and after) net position due to the implementation of GASB 68 for the year endedJune 30, 2015. The standard requires the Board to record its proportionate share of the net pension liability associated with its participation in the statewide Teachers’ and State Employees’ Retirement System (TSERS).

Note: Net position for 2017 and before are not comparable to 2018 (and after) net position due to the implementation of GASB 75 for the year endedJune 30, 2018. The standard requires the Board to record its proportionate share of the net OPEB liability and net OPEB asset associated with itsparticipation in the statewide Teachers’ and State Employees’ Retirement System (TSERS).

RICHMOND COUNTY BOARD OF EDUCATIONNet Position by Component

Last Ten Fiscal Years

Page 62

Table 2

Page 63

-$120

-$100

-$80

-$60

-$40

-$20

$0

$20

$40

$60

$80

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Ne

t P

osit

ion

(m

illi

on

s)

Fiscal Year Ended June 30

Net Position by Component District-wide

Net investment in capital assets Restricted Unrestricted (deficit)

Table 3

Year Ended June 30 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Expenses

Governmental activities:Instructional services 56,518,707$ 52,441,046$ 51,011,002$ 49,812,816$ 51,878,916$ 49,164,237$ 49,868,111$ 50,564,776$ 53,175,057$ 56,823,832$ System-wide support services 13,410,250 13,147,048 15,265,944 13,419,237 13,987,340 13,570,389 12,961,369 13,494,088 14,243,486 16,071,541 Ancillary services 54,919 181,815 140,066 153,736 106,409 108,248 118,713 216,458 112,924 99,100 Payments to other governments 122,286 42,989 81,995 19,629 20,593 20,336 9,020 23,283 25,510 22,631 Unallocated depreciation expense 1,471,334 1,564,030 1,896,449 1,917,366 1,944,329 1,840,217 1,980,622 1,976,608 2,005,193 2,019,441

Total governmental activities expenses 71,577,496 67,376,928 68,395,456 65,322,784 67,937,587 64,703,427 64,937,835 66,275,213 69,562,170 75,036,545

Business-type activities:School food service 4,634,189 4,190,516 4,318,386 4,490,112 4,809,731 4,471,062 4,845,146 4,916,148 4,876,684 5,090,553

Total district-wide expenses 76,211,685$ 71,567,444$ 72,713,842$ 69,812,896$ 72,747,318$ 69,174,489$ 69,782,981$ 71,191,361$ 74,438,854$ 80,127,098$

Program Revenues

Governmental activities:Charges for services:

Regular instructional -$ -$ -$ -$ -$ -$ 18,915$ 48,239$ 55,039$ 80,016$ Co-curricular services 1,677,862 1,596,942 1,676,643 1,479,652 1,489,981 1,475,802 1,716,506 1,691,827 1,775,790 1,925,839 Financial and human resource services 1,080 22,554 27,007 22,550 1,446 1,767 1,270 1,260 1,150 1,275

Operating grants and contributions 54,341,049 51,887,005 50,863,269 48,161,858 48,853,476 47,868,600 49,891,996 50,912,489 50,250,660 52,157,896 Capital grants and contributions 325,697 161,621 830,643 122,393 390,055 165,141 452,182 248,394 677,346 576,693

Total governmental activities program revenues 56,345,688 53,668,122 53,397,562 49,786,453 50,734,958 49,511,310 52,080,869 52,902,209 52,759,985 54,741,719

Business-type activities:Charges for services:

Student meal services 1,306,154 1,361,105 1,193,366 1,006,591 956,572 863,776 593,968 576,957 462,551 396,597 Operating grants and contributions 3,445,094 3,157,591 3,277,810 3,446,313 3,531,582 3,868,891 4,373,341 4,361,015 4,471,329 4,545,598 Capital grants and contributions - 31,552 - 36,301 - - - 98,929 - -

Total business-type activities program revenues 4,751,248 4,550,248 4,471,176 4,489,205 4,488,154 4,732,667 4,967,309 5,036,901 4,933,880 4,942,195 Total district-wide program revenues 61,096,936$ 58,218,370$ 57,868,738$ 54,275,658$ 55,223,112$ 54,243,977$ 57,048,178$ 57,939,110$ 57,693,865$ 59,683,914$

Net (Expense) Revenue

Governmental activities (15,231,808)$ (13,708,806)$ (14,997,894)$ (15,536,331)$ (17,202,629)$ (15,192,117)$ (12,856,966)$ (13,373,004)$ (16,802,185)$ (20,294,826)$ Business-type activities 117,059 359,732 152,790 (907) (321,577) 261,605 122,163 120,753 57,196 (148,358)

Total district-wide net (expense) revenue (15,114,749)$ (13,349,074)$ (14,845,104)$ (15,537,238)$ (17,524,206)$ (14,930,512)$ (12,734,803)$ (13,252,251)$ (16,744,989)$ (20,443,184)$

RICHMOND COUNTY BOARD OF EDUCATIONChanges in Net Position


Page 64

Table 3 (continued)

Year Ended June 30 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

General Revenues and Other Changes in Net Position

Governmental activities:Unrestricted county appropriations - operating 7,100,000$ 6,925,002$ 6,925,000$ 6,925,000$ 6,925,000$ 6,924,932$ 6,925,000$ 7,175,000$ 7,485,000$ 7,763,448$ Unrestricted county appropriations - capital 8,489,396 11,549,153 2,649,874 2,313,100 2,428,579 1,655,680 1,357,967 1,954,089 2,301,794 2,399,680 Unrestricted State appropriations - operating 4,238,011 4,136,702 4,804,239 4,550,809 4,546,444 4,441,181 4,296,464 4,164,923 4,236,314 4,216,616 Unrestricted State appropriations - capital - - - 237,649 128,551 - - - - - Unrestricted Federal appropriations - capital - - - 92,604 - - - - - - Investment earnings, unrestricted 71,445 40,987 24,639 31,846 21,709 17,508 19,420 21,653 27,444 42,466 Miscellaneous, unrestricted 1,091,772 1,087,548 1,195,177 771,918 650,516 720,241 806,937 851,007 700,151 724,221 Transfers - (45,736) (46,203) (46,319) (48,569) (45,017) (45,572) (45,695) (73,248) (45,000)

Total governmental activities 20,990,624 23,693,656 15,552,726 14,876,607 14,652,230 13,714,525 13,360,216 14,120,977 14,677,455 15,101,431

Business-type activities:Investment earnings, unrestricted 1,531 593 422 - - - - - - - Miscellaneous, unrestricted - - - 3,493 7,303 - - - - - Transfers - 45,736 46,203 46,319 48,569 45,017 45,572 45,695 73,248 45,000

Total business-type activities 1,531 46,329 46,625 49,812 55,872 45,017 45,572 45,695 73,248 45,000 Total district-wide 20,992,155$ 23,739,985$ 15,599,351$ 14,926,419$ 14,708,102$ 13,759,542$ 13,405,788$ 14,166,672$ 14,750,703$ 15,146,431$

Change in Net Position

Governmental activities 5,758,816$ 9,984,850$ 554,832$ (659,724)$ (2,550,399)$ (1,477,592)$ 503,250$ 747,973$ (2,124,730)$ (5,193,395)$ Business-type activities 118,590 406,061 199,415 48,905 (265,705) 306,622 167,735 166,448 130,444 (103,358)

Total district-wide change in net position 5,877,406$ 10,390,911$ 754,247$ (610,819)$ (2,816,104)$ (1,170,970)$ 670,985$ 914,421$ (1,994,286)$ (5,296,753)$


RICHMOND COUNTY BOARD OF EDUCATIONChanges in Net Position (continued)


Page 65

Table 4

Year Ended June 30 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

General Fund:Reserved 237,250$ 273,096$ -$ -$ -$ -$ -$ -$ -$ -$ Unreserved 2,926,189 3,633,096 - - - - - - - - Nonspendable - - 167,110 120,361 123,681 89,398 57,441 - - - Restricted - - 95,455 98,207 114,361 26,366 26,252 25,841 36,775 37,191 Assigned - - 2,189,396 2,486,667 2,486,667 2,577,530 - - - 2,483,542Unassigned - - 2,905,380 2,851,051 2,027,662 1,845,221 4,029,497 3,626,044 3,325,738 758,148

Total General Fund 3,163,439$ 3,906,192$ 5,357,341$ 5,556,286$ 4,752,371$ 4,538,515$ 4,113,190$ 3,651,885$ 3,362,513$ 3,278,881$

All other governmental funds:Reserved 1,210,923$ 378,650$ -$ -$ -$ -$ -$ -$ -$ -$ Unreserved, reported in:

Special Revenue Funds 564,518 622,139 - - - - - - - - Capital Outlay Fund 751,557 1,703,594 - - - - - - - -

Restricted - - 2,676,693 3,299,593 2,456,666 2,258,613 2,889,876 3,831,875 3,667,767 3,641,924Assigned, reported in:

Restricted Revenue Fund - - 256,837 225,399 517,883 661,823 392,972 74,670 279,188 296,763Unassigned - - 87,265 - - - - - - -

Total all other governmental funds 2,526,998$ 2,704,383$ 3,020,795$ 3,524,992$ 2,974,549$ 2,920,436$ 3,282,848$ 3,906,545$ 3,946,955$ 3,938,687$


Note: Fund balances for 2010 and before are not comparable to 2011 (and after) fund balances due to the implementation of GASB 54 for the year endedJune 30, 2011. The standard replaces the previous reserved and unreserved fund balance categories with the following five fund balance classifications:nonspendable, restricted, committed, assigned, and unassigned fund balance.

RICHMOND COUNTY BOARD OF EDUCATIONGovernmental Funds

Fund Balances


Page 66

Table 4

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

$4.0

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Fu

nd

Ba

lan

ce

(mil

lio

ns

)


Governmental Funds Fund Balances - Before GASB 54 Implementation

Reserved, General Unreserved, GeneralUnreserved, Special Revenue Funds Unreserved, Capital Outlay Fund

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

$4.0

$4.5

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Fu

nd

Ba

lan

ce

(mil

lio

ns

)


Governmental Funds Fund Balances - After GASB 54 Implementation

Restricted, General Assigned, GeneralUnassigned, General Assigned, Restricted Revenue Fund

Page 67

Table 5

Year Ended June 30 2009 2010 2011 2012 2013

Revenues

State of North Carolina 51,246,730$ 45,411,216$ 45,440,505$ 45,504,428$ 46,495,647$ Richmond County 15,589,396 18,474,155 9,574,874 9,238,100 9,353,579 U.S. Government 7,527,393 10,497,531 10,951,038 7,025,799 6,883,825 Other 3,122,036 3,124,806 3,070,952 3,186,513 2,886,622

Total revenues 77,485,555 77,507,708 69,037,369 64,954,840 65,619,673

Expenditures

Instructional services 56,441,411 52,628,526 51,342,272 49,691,409 51,512,004 System-wide support services 11,893,209 11,927,802 12,038,007 11,616,675 11,850,652 Ancillary services 54,919 181,815 140,066 153,736 106,409 Non-programmed charges 271,530 143,183 122,873 82,200 62,970 Debt service:

Principal retirement 325,697 161,621 151,674 122,393 390,055 Capital outlay 8,118,216 11,688,289 3,498,656 2,659,384 3,500,090

Total expenditures 77,104,982 76,731,236 67,293,548 64,325,797 67,422,180

Revenues over (under) expenditures 380,573 776,472 1,743,821 629,043 (1,802,507)

Other financing sources (uses)

Transfers to other funds - (45,736) (46,203) (46,319) (48,569) Installment purchase obligations 302,515 243,132 79,454 167,167 493,398

Total other financing sources (uses) 302,515 197,396 33,251 120,848 444,829

Net change in fund balances 683,088$ 973,868$ 1,777,072$ 749,891$ (1,357,678)$

Ratio of debt service expenditures tototal non-capital expenditures 0.47% 0.25% 0.24% 0.20% 0.61%

Year Ended June 30 2014 2015 2016 2017 2018

Revenues

State of North Carolina 45,818,507$ 47,902,781$ 48,364,803$ 48,992,842$ 49,900,548$ Richmond County 8,580,612 8,282,967 9,129,089 9,786,794 10,163,128 U.S. Government 6,223,613 6,335,647 6,014,966 5,774,613 6,514,280 Other 2,736,685 3,185,409 3,812,093 3,214,070 3,560,278

Total revenues 63,359,417 65,706,804 67,320,951 67,768,319 70,138,234

Expenditures

Instructional services 49,164,056 51,674,759 52,559,799 52,608,753 53,852,905 System-wide support services 12,310,710 12,255,489 12,325,483 13,355,986 13,838,871 Ancillary services 108,248 120,991 218,912 112,108 95,529 Non-programmed charges 108,901 115,465 135,353 126,072 112,715 Debt service:

Principal retirement 165,141 452,182 248,394 677,346 576,693 Capital outlay 1,691,030 1,894,405 2,076,993 2,047,492 2,139,636

Total expenditures 63,548,086 66,513,291 67,564,934 68,927,757 70,616,349

Revenues over (under) expenditures (188,669) (806,487) (243,983) (1,159,438) (478,115)

Other financing sources (uses)

Transfers to other funds (45,017) (45,572) (45,695) (45,015) (45,000) Installment purchase obligations - 821,103 509,511 955,491 431,215

Total other financing sources (uses) (45,017) 775,531 463,816 910,476 386,215

Net change in fund balances (233,686)$ (30,956)$ 219,833$ (248,962)$ (91,900)$

Ratio of debt service expenditures tototal non-capital expenditures 0.27% 0.70% 0.38% 1.02% 0.85%


RICHMOND COUNTY BOARD OF EDUCATIONGovernmental Funds

Changes in Fund Balances


Page 68

Table 5

$0$5

$10$15$20$25$30$35$40$45$50$55

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Re

ve

nu

es

(mil

lio

ns

)


Governmental Funds Revenues by Source

State of North Carolina Richmond County U.S. Government Other

$0$5

$10$15$20$25$30$35$40$45$50$55$60

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Ex

pe

nd

itu

res

(mil

lio

ns

)


Governmental Funds Expenditures by Function

Instructional services System-wide support services Ancillary services Capital outlay

Page 69

Table 6

EXPRESSED IN NOMINAL DOLLARS

Year Ended June 30 2009 2010 2011 2012 2013

Average Daily Membership 7,717 7,604 7,546 7,555 7,527Instructional 7,314$ 6,921$ 6,804$ 6,577$ 6,844$ System-wide support 1,541 1,569 1,595 1,538 1,574 Ancillary 7 24 19 20 14

Total expenditures per pupil 8,862$ 8,514$ 8,418$ 8,135$ 8,432$

Year Ended June 30 2014 2015 2016 2017 2018

Average Daily Membership 7,510 7,494 7,343 7,265 7,159Instructional 6,546$ 6,895$ 7,158$ 7,241$ 7,522$ System-wide support 1,639 1,635 1,679 1,838 1,933 Ancillary 14 16 30 15 13


Year Ended June 30 2009 2010 2011 2012 2013

Instructional 3,391$ 3,175$ 3,014$ 2,866$ 2,931$ System-wide support 714 720 707 670 674 Ancillary 3 11 8 9 6


Year Ended June 30 2014 2015 2016 2017 2018

Instructional 2,746$ 2,889$ 2,970$ 2,956$ 2,985$ System-wide support 688 685 697 750 767 Ancillary 6 7 12 6 5


Source: Richmond County Board of Education, North Carolina, Annual Financial Reports.Note: The above operational expenditures per pupil include all governmental funds.

Note: Nominal dollars reflect actual dollars of the period of the transaction. Constant dollars reflect dollars having a constant generalpurchasing power as shown by the Consumer Price Index for All Urban Consumers (CPI-U) (Calendar years 1982-1984=100).

EXPRESSED IN CONSTANT DOLLARS


RICHMOND COUNTY BOARD OF EDUCATIONOperational Expenditures Per Pupil

Expenditures by Function



Page 70

Table 6

Page 71

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Pe

r P

up

il E

xp

en

dit

ure

s

(no

min

al d

oll

ars

)


Operational Expenditures Per Pupil Expenditures by Function

Instructional System-wide support Ancillary

Table 7

Year Ended June 30 2009 2010 2011 2012 2013

Food sales 1,306,154$ 1,361,105$ 1,193,366$ 1,006,591$ 956,572$Federal reimbursements 2,605,435 2,925,338 2,956,508 3,213,483 3,285,555Federal commodities 193,752 223,501 304,030 228,384 238,004Other 647,438 9,345 17,694 7,939 15,326

Total revenues 4,752,779$ 4,519,289$ 4,471,598$ 4,456,397$ 4,495,457$

Year Ended June 30 2014 2015 2016 2017 2018

Food sales 863,776$ 593,968$ 576,957$ 462,551$ 396,597$Federal reimbursements 3,589,629 4,106,270 4,059,163 4,166,624 4,228,744Federal commodities 270,116 263,724 299,644 304,011 316,854Other 9,146 3,347 2,208 694 -

Total revenues 4,732,667$ 4,967,309$ 4,937,972$ 4,933,880$ 4,942,195$

Year Ended June 30 2009 2010 2011 2012 2013

Food sales 605,562$ 624,460$ 528,688$ 438,644$ 409,660$Federal reimbursements 1,207,937 1,342,114 1,309,801 1,400,345 1,407,066Federal commodities 89,828 102,540 134,692 99,523 101,927Other 300,166 4,287 7,839 3,460 6,563

Total revenues 2,203,493$ 2,073,401$ 1,981,020$ 1,941,972$ 1,925,216$

Year Ended June 30 2014 2015 2016 2017 2018

Food sales 362,409$ 248,899$ 239,364$ 188,831$ 157,387$Federal reimbursements 1,506,077 1,720,711 1,684,034 1,700,975 1,678,146Federal commodities 113,331 110,512 124,314 124,109 125,741Other 3,837 1,403 916 283 -

Total revenues 1,985,654$ 2,081,525$ 2,048,628$ 2,014,198$ 1,961,274$


Note: Other revenue includes interest earned, State reimbursements, and other revenue.

Note: Nominal dollars reflect actual dollars of the period of the transaction. Constant dollars reflect dollars having a constant generalpurchasing power as shown by the Consumer Price Index for All Urban Consumers (CPI-U) (Calendar years 1982-1984 = 100).




RICHMOND COUNTY BOARD OF EDUCATIONProprietary Fund - Food Services Operations

Revenues by Source



Page 72

Table 7

Page 73

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

$4.0

$4.5

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Re

ve

nu

es

(no

min

al d

oll

ars

in

mil

lio

ns

)


Proprietary Fund - Food Service Operations Revenues by Source

Food sales Federal reimbursements Federal commodities Other

Table 8

Year Ended June 30 2009 2010 2011 2012 2013

Purchase of food 1,412,251$ 1,112,855$ 1,222,967$ 1,599,946$ 1,703,799$Donated commodities 258,104 223,501 304,030 228,384 238,004Salaries and benefits 2,406,192 2,608,001 2,372,801 2,251,292 2,400,211Other 557,642 246,159 418,588 410,490 467,717

Total expenses 4,634,189$ 4,190,516$ 4,318,386$ 4,490,112$ 4,809,731$

Year Ended June 30 2014 2015 2016 2017 2018

Purchase of food 1,592,105$ 1,828,136$ 1,766,724$ 1,605,668$ 1,583,105$Donated commodities 270,116 263,724 299,644 304,011 316,854Salaries and benefits 2,301,644 2,212,771 2,250,213 2,503,754 2,704,167Other 307,197 540,515 599,567 463,251 486,427

Total expenses 4,471,062$ 4,845,146$ 4,916,148$ 4,876,684$ 5,090,553$

Year Ended June 30 2009 2010 2011 2012 2013

Purchase of food 654,751$ 510,566$ 541,802$ 697,211$ 729,666$Donated commodities 119,663 102,540 134,692 99,523 101,927Salaries and benefits 1,115,563 1,196,523 1,051,205 981,049 1,027,910Other 258,535 112,935 185,444 178,880 200,304

Total expenses 2,148,512$ 1,922,564$ 1,913,143$ 1,956,663$ 2,059,807$

Year Ended June 30 2014 2015 2016 2017 2018

Purchase of food 667,989$ 766,071$ 732,965$ 655,495$ 628,244$Donated commodities 113,331 110,512 124,314 124,109 125,741Salaries and benefits 965,686 927,250 933,551 1,022,128 1,073,129Other 128,889 226,500 248,744 189,117 193,035

Total expenses 1,875,895$ 2,030,333$ 2,039,574$ 1,990,849$ 2,020,149$


Note: Other expense includes indirect costs, materials and supplies, repairs and maintenance, depreciation, and other expenses.

Note: Nominal dollars reflect actual dollars of the period of the transaction. Constant dollars reflect dollars having a constant generalpurchasing power as shown by the Consumer Price Index for All Urban Consumers (CPI-U) (Calendar years 1982-1984 = 100).


RICHMOND COUNTY BOARD OF EDUCATIONProprietary Fund - Food Services Operations

Expenses by Category





Page 74

Table 8

Page 75

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

$3.0

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Ex

pe

ns

es

(n

om

inal d

oll

ars

in

mil

lio

ns

)


Proprietary Fund - Food Services Operations Expenses by Category

Purchase of food Donated commodities Salaries and benefits Other

Table 9

Percentage of

Year Ended Installment Total Primary Personal Per

June 30 Purchases Government Income Capita

2018 906,974$ 906,974$ N/A N/A

2017 1,052,452 1,052,452 N/A 23$

2016 774,307 774,307 0.052% 17

2015 513,190 513,190 0.036% 11

2014 144,269 144,269 0.011% 3

2013 309,410 309,410 0.023% 7

2012 206,067 206,067 0.015% 4

2011 161,293 161,293 0.013% 3

2010 233,513 233,513 0.018% 5

2009 152,002 152,002 0.012% 3

N/A = Not available


Note: Richmond County School System cannot incur debt without obtaining prior approval from the Board.

Note: This table is a ten year schedule. However, current year county level annual population estimates are not released by the U.S. Census Bureauuntil the spring of the following year. Therefore, June 30, 2018 population based information will be shown above as "N/A", and the information willbe reported for the year ended June 30, 2019, if applicable.

Note: This table is a ten year schedule. However, county level annual income data is not released by the U.S. Bureau of Economic Analysis until themonth of April, and is always two years behind. Therefore, June 30, 2017 and June 30, 2018 income based information will be shown above as "N/A",and the June 30, 2017 information will be reported for the year ended June 30, 2019, if applicable.

RICHMOND COUNTY BOARD OF EDUCATIONRatios of Outstanding Debt by Type


Page 76

Table 10

Page 77

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Avg Daily Membership 7,717 7,604 7,546 7,555 7,527 7,510 7,494 7,343 7,265 7,159

7,000

7,100

7,200

7,300

7,400

7,500

7,600

7,700

7,800

7,900

8,000

8,100

8,200

RICHMOND COUNTY BOARD OF EDUCATION Average Daily Membership


Table 11

Year Ended Teaching Teacher/ Student Attendance Percentage of Students

June 30 Staff Students Pupil Ratio Percentage(1)

Receiving Free/Reduced Lunch(2)

2018 492 7,159 1/15 N/A 100%2017 469 7,265 1/16 95.04% 74%2016 485 7,343 1/15 95.11% 65%2015 494 7,494 1/15 94.42% 66%2014 460 7,510 1/16 92.93% 76%2013 515 7,527 1/15 94.03% 75%2012 468 7,555 1/16 94.52% 76%2011 485 7,546 1/16 93.59% 73%2010 559 7,604 1/14 93.50% 74%2009 641 7,717 1/12 94.39% 71%

RICHMOND COUNTY BOARD OF EDUCATIONStudent Statistics


Page 78

Table 11 (continued)

Year Ended Percentage of Graduates

June 30 White Black Hispanic Other Graduates(3)

Continuing Education(3)

2018 44% 35% 12% 9% N/A N/A2017 44% 36% 12% 8% 489 69%2016 45% 36% 11% 8% 499 78%2015 45% 37% 10% 8% 549 79%2014 45% 37% 9% 9% 499 83%2013 46% 37% 9% 8% 482 82%2012 46% 38% 8% 8% 456 85%2011 46% 38% 8% 8% 434 80%2010 46% 41% 7% 6% 471 76%2009 46% 42% 6% 6% 470 78%

N/A = Not Available

Sources:(1) NC Department of Public Instruction Average Daily Attendance(ADA):Average Daily Membership(ADM) Ratio Reports.(2) NC Department of Public Instruction Free & Reduced Meals Application Data Reports. Information for 2018 obtained from Richmond County Board of Education Student Data.(3) North Carolina Public Schools Statistical Profile (2009-2018 Editions).

Note: This table is a ten year schedule. However, the graduate data for the year ended June 30, 2018 could not be obtained from the North CarolinaDepartment of Public Instruction prior to this report being issued. Therefore, there are only nine years of comparative data noted above.

Note: Percentage of students receiving free/reduced lunch for 2014 and before are not comparable to 2015 - 2017 due to theimplementation of the Community Eligibility Program, which provides free lunch to all students in grades kindergarten thru eighth.

Note: Percentage of students receiving free/reduced lunch for 2017 and before are not comparable to 2018 (and after) due to theimplementation of the Community Eligibility Program, which provides free lunch to all students.

RICHMOND COUNTY BOARD OF EDUCATIONStudent Statistics (continued)


Ethnic Distribution Percentage(3)

Page 79

Table 12

Year Ended June 30 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Officials, admins, mgrs 15 17 17 18 15 15 16 18 18 19Principals 18 18 17 17 17 16 16 16 16 15Asst. Principals, non-teaching 17 17 18 19 19 19 18 18 18 15

Total administrators 50 52 52 54 51 50 50 52 52 49

Elementary teachers 298 397 331 337 362 301 353 347 333 360Secondary teachers 343 162 154 131 153 159 141 138 136 132

Total teachers 641 559 485 468 515 460 494 485 469 492

Guidance 22 22 19 18 18 20 18 18 19 17Psychological - - - - - - - 1 1 1Librarian, audiovisual 17 15 15 12 12 13 13 13 12 13Other professionals - 16 13 10 14 16 16 14 30 30

Total professionals 730 664 584 562 610 559 591 583 583 602

Teacher Assistants 217 207 171 170 165 157 153 151 141 142Technicians 5 5 5 5 5 5 4 6 6 5Clerical, secretarial 61 69 60 59 62 63 62 61 60 55Service workers 208 189 189 171 181 186 179 165 156 182

Total employees 1,221 1,134 1,009 967 1,023 970 989 966 946 986

Source: North Carolina Public Schools Statistical Profile (2009-2018 Editions)

RICHMOND COUNTY BOARD OF EDUCATIONFull-time Equivalent Governmental Employees by Function/Program


Page 80

Table 13

Year Ended Bachelors Masters Advanced Doctorate

June 30 Minimum Maximum Average Degree(2)

Degree(2)

Degree(2)

Degree(2)

2018 35,000$ 62,590$ 48,795$ 357 114 3 22017 35,000 62,220 48,610 385 98 2 -2016 35,000 61,000 48,000 382 140 7 12015 33,000 61,000 47,000 339 152 2 12014 30,800 65,520 48,160 344 137 3 -2013 30,800 65,520 48,160 337 118 1 -2012 30,430 64,750 47,590 381 95 1 -2011 30,430 64,750 47,590 391 97 1 -2010 30,430 64,750 47,590 427 118 2 12009 30,430 64,750 47,590 428 103 2 -

The above tabulation represents state base salaries, but does not include the following:

(a) Longevity payments, ranging from 1 1/2% to 4 1/2% of the annual salary, made to each teacher for 10 or more years of service.(b) Payments of varying amounts for performing extra duties.(c) Bonus payments(d) Local salary supplements

Sources:(1) Richmond County Board of Education Payroll Data.(2) North Carolina Public Schools Statistical Profile (2009-2017 Editions). Information for 2018 obtained from Richmond County Board of Education Personnel Data.

RICHMOND COUNTY BOARD OF EDUCATIONInstructional Personnel


Teacher Salaries(1)

Page 81

Table 14

Year Current Over/(Under)

Site Built Capacity Membership Capacity Condition

East Rockingham Elementary 2010 736 578 -21% Excellent

Fairview Heights Elementary 1950 834 507 -39% Poor

LJ Bell Elementary 1952 746 558 -25% Poor

Mineral Springs Elementary 1951 471 416 -12% Poor

Monroe Avenue Elementary 1953 770 416 -46% Poor

Washington Street Elementary 1990 688 522 -24% Good

West Rockingham Elementary 1970 506 299 -41% Excellent

Ellerbe Middle 1950 696 235 -66% Poor

Hamlet Middle 1976 899 476 -47% Good

Rockingham Middle 1956 1,421 682 -52% Excellent

Cordova Middle 1950 256 272 6% Excellent

Ashley Chapel Educational Center 1952 220 68 -69% Poor

Ninth Grade Academy 2000 870 494 -43% Excellent

Richmond Senior High 1972 2,233 1,365 -39% Good

Richmond Early College(1) N/A N/A 271 N/A N/A

N/A = Not Applicable

Source: Richmond County Board of Education N. C. Public Schools Facility Needs Report; 2018

Note:(1) Early College is located at Richmond Community College

RICHMOND COUNTY BOARD OF EDUCATIONSchool Building Data

June 30, 2018

Page 72

Table 15

Year Ended June 30 2009 2010 2011 2012 2013

Population estimate (1) 45,970 46,654 46,611 46,627 46,405Personal income (2) $1,239,292,000 $1,294,250,000 $1,284,617,000 $1,343,781,000 $1,353,118,000Per capita income (2) $26,959 $27,741 $27,560 $28,820 $29,159

Median age (3) 36.24 36.27 37.91 38.13 38.36

School enrollment (4) 7,717 7,604 7,546 7,555 7,527

Unemployment rate (5) 13.8% 13.8% 14.0% 13.0% 12.2%

Year Ended June 30 2014 2015 2016 2017 2018

Population estimate (1) 45,733 45,437 44,939 44,798 N/APersonal income (2) $1,371,600,000 $1,424,950,000 $1,476,163,000 N/A N/APer capita income (2) $29,991 $31,361 $32,848 N/A N/A

Median age (3) 38.52 38.61 39.99 40.14 40.40

School enrollment (4) 7,510 7,494 7,343 7,265 7,159

Unemployment rate (5) 8.2% 8.4% 7.0% 5.7% 5.8%

N/A = Not Available

Sources:(1) Based upon estimates issued by the U.S. Census Bureau as of July 1(2) Bureau of Economic Analysis(3) Office of State Budget and Management(4) North Carolina Department of Public Instruction(5) North Carolina Employment Security Commission



RICHMOND COUNTY, NORTH CAROLINADemographic Statistics


Page 83

Table 16

Approximate Approximate

Percentage of Percentage of

Total County Total County

Employer Employees (1)

Rank Employment Employees (1)

Rank Employment

Richmond County Schools 1,000+ 1 6%+ 1,000+ 1 6%

Perdue Products Incorporated 1,000+ 2 6%+ 1,000+ 2 6%

First Health Moore Regional Hospital 500 - 999 3 5% 500 - 999 3 5%

County of Richmond 250 - 499 4 2% 250 - 499 4 2%

Richmond Community College 250 - 499 5 2% 250 - 499 5 2%

Wal-Mart Associates, Inc. 250 - 499 6 2% 250 - 499 7 2%

Department of Public Safety 250 - 499 7 2% 250 - 499 6 2%

Burlington Industries, LLC 250 - 499 8 2% 250 - 499 8 2%

Plastek Industries, Inc. 250 - 499 9 2%

Cascades Holding US Inc. 100 - 249 10 1%

Sandhills Regional Medical Center 250 - 499 9 2%

Trident Management Inc. 100 - 249 10 1%30%+ 30%+

Total County Employment (2) 15,796 18,322

Sources:(1) North Carolina Chamber of Commerce - current year data is as of March 31st(2) North Carolina Employment Security Commission

2018 2009

RICHMOND COUNTY, NORTH CAROLINAPrincipal Employers

For Years Ended June 30, 2018 and 2009

Page 84

Table 17

General General Percentage of

Year Ended Installment Obligation Installment Obligation Total Primary Personal Per

June 30 Purchases Bonds Purchases Bonds Government Income Capita

2018 N/A N/A N/A N/A N/A N/A N/A

2017 14,953,291$ 17,115,752$ 1,621,790$ 5,876,000$ 39,566,833$ N/A 883$

2016 3,200,958 29,661,000 2,054,156 1,511,000 36,427,114 2.47% 811

2015 2,177,035 31,865,000 2,287,235 1,896,000 38,225,270 2.68% 841

2014 1,050,864 34,424,000 1,261,009 2,301,000 39,036,873 2.85% 854

2013 859,266 36,998,000 1,157,711 2,837,000 41,851,977 3.09% 902

2012 647,749 39,800,000 884,719 3,255,000 44,587,468 3.32% 956

2011 278,551 42,300,000 417,050 3,760,000 46,755,601 3.64% 1,003

2010 83,027 44,800,000 819,555 4,340,000 50,042,582 3.87% 1,073

2009 154,127 33,600,000 1,312,397 4,945,000 40,011,524 3.23% 870

N/A = Not Available

Source: Richmond County, North Carolina, Annual Financial Reports.

Note: This table is a ten year schedule. However, the annual financial report for the year ended June 30, 2018 could not be obtained fromRichmond County nor their auditors prior to this report being issued. Therefore, there are only nine years of comparative data noted above.



RICHMOND COUNTY, NORTH CAROLINARatios of Outstanding Debt by Type


Business -Type ActivitiesGovernmental Activities

Page 85

Table 18

Percentage of Percentage of

Type of Taxable Total Taxable Taxable Total Taxable

Taxpayer Business Assessed Value Rank Assessed Value Assessed Value Rank Assessed Value

Duke Energy Progress Utility 538,749,413$ 1 18.15% 352,442,411$ 1 12.18%

NC Electric Membership Corp. Utility 119,538,758 2 4.03% 120,214,296 2 4.15%

Piedmont Natural Gas Co. Inc. Utility 39,346,143 3 1.33% 25,311,353 5 0.87%

CSX Transportation Inc. Railroad 33,723,685 4 1.14% 22,217,835 6 0.77%

Trans Carolina Products LLC Manufacturing 33,375,575 5 1.12% 46,145,404 3 1.59%

Perdue Foods LLC Poultry Processing 26,638,254 6 0.90% - -

Pee Dee Electric Membership Corp. Utility 24,171,388 7 0.81% 18,736,725 10 0.65%

Plastek Industies, Inc. Manufacturing 23,415,920 8 0.79% - -

Phase II of NC, LLC Solar Farm 17,711,967 9 0.60% - -

Eden Solar, LLC Solar Farm 17,515,676 10 0.59% - -

Owens Illinois Closure Inc. Plastics - - 32,281,777 4 1.12%

Perdue Farms Inc. Poultry Processing - - 22,056,965 7 0.76%

Von Drehle Cordova, LLC Paper Products - - 20,664,424 8 0.71%

Hospital Management Association Health Care - - 20,447,772 9 0.71%874,186,779$ 29.46% 680,518,962$ 23.51%

Total Assessed Valuation 2,968,330,815$ 2,894,678,472$

Source: Richmond County, North Carolina, Annual Financial Report for the years ended June 30, 2009 and June 30, 2017.

Note: This table is a ten year schedule. However, the annual financial report for the year ended June 30, 2018 could not be obtained fromRichmond County nor their auditors prior to this report being issued. Therefore, there are only nine years of comparative data noted above.

20082016

RICHMOND COUNTY, NORTH CAROLINAPrincipal Property Taxpayers

December 31, 2016 and December 31, 2008

Page 86

Table 19

Total Current Tax Percent of Levy

Year Ended June 30 Tax Levy Collections Collected

2018 N/A N/A N/A2017 26,011,157$ 25,202,623$ 96.89%2016 26,132,950 25,345,960 96.99%2015 24,847,672 23,993,456 96.56%2014 25,525,270 24,321,927 95.29%2013 24,453,470 22,975,649 93.96%2012 24,452,120 23,063,215 94.32%2011 23,583,663 22,384,481 94.92%2010 22,817,014 21,665,934 94.96%2009 23,584,966 22,455,421 95.21%

Total Current Tax

Year Ended June 30 Tax Levy Collections

2018 N/A N/A2017 10,618,749$ 10,288,675$ 2016 10,841,838 10,515,338 2015 10,412,286 10,054,332 2014 10,709,469 10,204,590 2013 10,472,399 9,839,510 2012 10,655,540 10,050,295 2011 10,448,101 9,916,836 2010 10,468,201 9,940,098 2009 10,934,507 10,410,825

N/A = Not Available

Source: Richmond County, North Carolina, Annual Financial Reports.

Note: Nominal dollars reflect actual dollars of the period of the transaction. Constant dollars reflect dollars having aconstant general purchasing power as shown by the Consumer Price Index for All Urban Consumers (CPI-U)(Calendar years 1982-1984=100).

Note: This table is a ten year schedule. However, the annual financial report for the year ended June 30, 2018could not be obtained from Richmond County nor their auditors prior to this report being issued. Therefore,there are only nine years of comparative data noted above.

RICHMOND COUNTY, NORTH CAROLINAProperty Tax Levies and Current Collections




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