HomeMy WebLinkAboutComprehensive Annual
Comprehensive Annual
Financial Report
Year Ended June 30, 2012
Bernadette Pelissier
Chair, Board of County Commissioners
Frank Clifton Clarence G. Grier, CPA
County Manager Assistant County Manager &
Chief Financial Officer
Prepared by
The Orange County Finance & Administrative Services
Department
Howard A. Fitts, CPA, Accountant
Shari Rasberry, Financial Service Coordinator
Michele Brooks, Accounting Technician
Katina Perry, Accounting Technician
Kimberlee Quatrone, Accounting Technician
and the Budget Office Staff
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OC
RANGE OUNTY
NC
ORTH AROLINA
CAFR
OMPREHENSIVE NNUAL INANCIAL EPORT
FYEJ30,2012
OR THE EARNDEDUNE
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ORANGE COUNTY, NORTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2012
TABLE OF CONTENTS
Page
Introductory Section
Letter of Transmittali-v
Certificate of Achievement for Excellence in Financial Reportingvi
Board of County Commissionersvii
Organizational Chartviii
Financial Section
Independent Auditors' Report1-2
Management's Discussion and Analysis3-15
Exhibit
Basic Financial Statements
Government-Wide Financial Statements:
AStatement of Net Assets16
BStatement of Activities17-18
Fund Financial Statements:
CBalance Sheet - Governmental Funds19-20
DStatement of Revenues, Expenditures, and Changes
in Fund Balances - Governmental Funds21
EReconciliation of the Statement of Revenues, Expenditures,
and Changes in Fund Balances - Governmental Funds to the
Statement of Activities22
FStatement of Revenues, Expenditures, and Changes
in Fund Balances - Budget and Actual- General Fund23
GStatement of Net Assets - Proprietary Funds24
ORANGE COUNTY, NORTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2012
TABLE OF CONTENTS
ExhibitPage
HStatement of Revenues, Expenses, and Changes in
Fund Net Assets - Proprietary Funds25
IStatement of Cash Flows - Proprietary Funds26
JStatement of Fiduciary Net Assets - Fiduciary Funds27
Notes to the Financial Statements
28-70
Schedule
Required Supplemental Financial Data:
A-1Law Enforcement Officers' Special Separation Allowance71
A-2Healthcare Benefits Plan72
Combining and Individual Fund Statements and Schedules:
B-1General Fund Consolidated -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual73
B-2General Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual74-77
B-3Property Revaluation Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual78
Major Funds:
B-4County Capital Improvements Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual79-80
B-5School Capital Improvements Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual81-82
ORANGE COUNTY, NORTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2012
TABLE OF CONTENTS
SchedulePage
Nonmajor Governmental Funds:
C-1Combining Balance Sheet83
C-2Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances84
Nonmajor Capital Projects Funds:
C-3Combining Balance Sheet85
C-4Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances86
C-5School Capital Reserve Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual87
C-6County Capital Reserve Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual88
Nonmajor Special Revenue Funds:
D-1Combining Balance Sheet89-90
D-2Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances91-92
D-3Impact Fee Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual93
D-4Community Development Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual94
D-5Section 8 Housing Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual95
ORANGE COUNTY, NORTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2012
TABLE OF CONTENTS
SchedulePage
D-6Grant Supported Projects Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual96
D-7Grants Project Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual97-98
D-8Emergency Telephone System Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual99
D-9Visitors' Bureau Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual100
D-10Local Fire Districts Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual101
D-11Heusner Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual102
D-12Library Development Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual103
D-13Adoption Enhancement Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual104
D-14Recreation Subdivision Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual105
D-15Articles 46 Sales Tax -
Schedule of Revenues, Expenditures, and Changes106
in Fund Balance - Budget and Actual
ORANGE COUNTY, NORTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2012
TABLE OF CONTENTS
SchedulePage
D-16Piedmont Food and Agricultural Processing Center -
Schedule of Revenues, Expenditures, and Changes107
in Fund Balance - Budget and Actual
D-17Spay Neuter Fund -
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual108
Enterprise Funds:
E-1Solid Waste Landfill Fund -
Schedule of Revenues and Expenditures -
Budget and Actual (Non-GAAP)109
E-2SportsPlex Fund -
Schedule of Revenues and Expenditures -
Budget and Actual (Non-GAAP)110
E-3Efland Sewer Operating Fund -
Schedule of Revenues and Expenditures -
Budget and Actual (Non-GAAP)111
Internal Service Fund:
F-1Dental Insurance Fund -
Schedule of Revenues and Expenditures -
Budget and Actual (Non-GAAP)112
F-2OPC Retiree Health Insurance Fund -
Schedule of Revenues and Expenditures -
Budget and Actual (Non-GAAP)113
Agency Funds:
G-1Combining Statement of Fiduciary Assets and Liabilities114-115
G-2Combining Statement of Changes in Assets and Liabilities116-117
ORANGE COUNTY, NORTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2012
TABLE OF CONTENTS
ExhibitPage
Supplemental Financial Data:
H-1Schedule of Ad Valorem Taxes Receivable 118
H-2Analysis of Current Tax Levy119
Table
Statistical Section
1Net Assets By Component120
2Changes in Net Assets121-122
3Fund Balances of Governmental Funds123
4Changes in Fund Balances of Governmental Funds124
5Assessed Value and Actual Value of Taxable Property125
6Direct and Overlapping Property Tax Rates126
7Principal Property Taxpayers127
8Property Tax Levies and Collections128
9Ratio of Outstanding Debt By Type129
10Ratios of Net General Bonded Debt Outstanding130
11Legal Debt Margin Information131
12Direct and Overlapping Governmental Activities Debt132
13Demographic and Economic Statistics133
14Principal Employers134
15Full-Time Equivalent County Government Employees by Function135
16Operating Indicators By Function136
17Capital Asset Statistics By Function137
ORANGE COUNTY, NORTH CAROLINA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2012
TABLE OF CONTENTS
Page
Compliance Section
Report On Internal Control Over Financial Reporting And
On Compliance And Other Matters Based On An Audit
Of Financial Statements Performed In Accordance
With Government Auditing Standards
138-139
Report On Compliance With Requirements That Could Have
Have A Direct And Material Effect On Each Major Federal
Program And On Internal Control Over Compliance In
Accordance With OMB Circular A-133 And The State
Single Audit Implementation Act140-141
Report On Compliance With Requirements That Could Have
A Direct And Material Effect On Each State Program And
On Internal Control Over Compliance In Accordance With
Applicable Sections of OMB Circular A-133 And The
State Single Audit Implementation Act142-143
Schedule of Findings:
Schedule of Findings and Questioned Costs144-146
Summary Schedule of Prior Year's Audit Findings147
Schedule of Expenditures of Federal and State Awards148-152
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Introductory Section
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ORANGE COUNTY
208 South Cameron Street Tel: 919-245-2453
Post Office Box 8181 Fax: 919 644-3324
Hillsborough, NC 27278
November 20, 2012
The Board of County Commissioners,
Frank Clifton, County Manager
Citizens of Orange County, North Carolina
Laws of the State of North Carolina, along with policies and procedures of the North Carolina Local
Government Commission, require that all local governments in the State publish a complete set of
financial statements annually. The financial statements must be presented in conformity with accounting
principles generally accepted in the United States of America ("GAAP") and audited in accordance with
auditing standards generally accepted in the United States of America by a firm of licensed certified
public accountants. Pursuant to those requirements, I hereby issue the comprehensive annual financial
report ("CAFR") of Orange County for the fiscal year ended June 30, 2012.
This report consists of management's representations concerning the finances of Orange County.
Consequently, management assumes full responsibility for the completeness and reliability of all of the
information presented in this report. To provide a reasonable basis for making these representations,
management of the County has established a comprehensive internal control framework that is designed
both to protect the government's assets from loss, theft, or misuse and to compile sufficient reliable
information for the preparation of the County's financial statements in conformity with GAAP. Since the
cost of internal controls should not outweigh their benefits, the County's internal control structure has
been designed to provide reasonable rather than absolute assurance that the financial statements will be
free from material misstatement. As management, we assert that, to the best of our knowledge and belief,
this financial report is complete and reliable in all material respects.
The County's financial statements have been audited by Martin Starnes & Associates, CPA, PA, a firm of
licensed certified public accountants. The audit involved examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements; assessing the accounting principles used and
significant estimates made by management; and evaluating the overall financial statement presentation.
The independent auditor rendered an unqualified opinion that the County's financial statements for the
fiscal year ended June 30, 2012, are fairly presented in conformity with GAAP. This opinion can be
found at the beginning of the financial section of this document. In addition to the independent audit of
the financial statements, the County is required to undergo an annual "Single Audit" designed to meet the
special needs of federal grantor agencies. Information regarding this audit is submitted in the Compliance
Sections of this report and includes the schedules of financial assistance and findings and questioned costs
and the independent auditors' reports on the internal control structure and on compliance.
GAAP require that management provide a narrative introduction, overview, and analysis to accompany
the basic financial statements in the form of Management's Discussion and Analysis ("MD&A"). This
letter of transmittal is designed to complement MD&A and should be read in conjunction with it. The
County's MD&A can be found immediately following the report of independent auditors.
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COUNTY PROFILE
Orange County, founded in 1752, is located in the north-central portion of North Carolina, approximately
midway between Washington, DC and Atlanta, GA. The County is part of the Raleigh/Durham/Chapel
Hill Metropolitan Statistical Area, which also includes the Research Triangle Park, a major complex of
research and research-oriented manufacturing facilities.
The County operates under a Commissioner-Manager form of government. The governing body of the
County is the Board of County Commissioners, which formulates policies for the administration of the
County. In addition, the Board annually adopts a balanced budget and establishes a tax rate for the support
of the County's programs. The Board consists of seven commissioners, elected on a staggered basis for
terms of four years. The County Manager is appointed by, and serves at the pleasure of the Board as the
County's Chief Executive Officer. He has appointive and removal authority over department heads and
other employees of the County. The County Manager is responsible for the daily operations of the County
Government. In addition the Manager's responsibilities include implementation of policies established by
the Board of Commissioners, as well as the administration of the annual budget adopted by the Board.
The County provides a wide range of services, including public safety, human services (Social Services,
Health and Aging), and funds for education, cultural and recreational activities, general administration
functions and others. This CAFR includes all funds and account groups of the County including all
activities considered to be part of (controlled by or dependent on) the County. In the fiscal year ended
June 30, 1995, the County implemented Governmental Accounting Standards Board ("GASB") Statement
No. 14, The Financial Reporting Entity. As a result, the Orange County ABC Board is reported as a
discretely presented component unit of the County.
The budget serves as the foundation for Orange County's financial planning and control. As required by
the North Carolina Budget and Fiscal Control Act, the County adopts an annual budget for all
governmental funds except those authorized by project ordinance that are multi-year in nature.
Appropriations to the various funds are formally budgeted on a functional basis. The County Manager is
authorized to approve appropriation transfers within all functions. Transfers that alter the total
appropriation of any functional category or fund, including the multi-year project funds, must be approved
by the County Commissioners. However; for expenditure control purposes the budget is monitored and
controlled on a departmental level.
FACTORS AFFECTING FINANCIAL CONDITION
The information presented in the financial statements is perhaps best understood when it is considered
from the broader perspective of the specific environment within which the County operates.
Local economy
Orange County is part of the 13 county Research Triangle Regions. This area continues to
experience growth and is considered among the most desirable areas of the country to live and work. The
region added over 125,000 jobs in the last six years. Research Triangle park was named the #1 High-Tech
Region by the Silicon Valley Leadership Group and the region was named the #1 Region for
Biotechnology by the Milkmen Institute.
The County's economy is characterized by a high degree of institutional and public-sector activity, plus
office, commercial and service-oriented business. Manufacturing and agriculture are smaller portions of
the County's economy.
The County enjoys a consistently low unemployment rate. The unemployment rate estimated by the North
Carolina Employment Security Commission for Calendar year 2011 was 6.3% and for September 2012
was 5.7%, one of the lowest in the State. (State average was 9.6% for September 10.4% for calendar year
2011.)
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The University of North Carolina at Chapel Hill and University Hospitals in the Town of Chapel Hill and
their associated service, teaching and research programs have a reputation for excellence in the
educational and medical fields. The County is also the place of residence for many technical, professional
and executive people who work in the Research Triangle Park and neighboring cities of Durham, Raleigh,
and Burlington.
The Research Triangle refers to an area located among three municipalities: Chapel Hill, Durham and
Raleigh. In addition to the University of North Carolina at Chapel Hill, universities located in these
municipalities include Duke University and North Carolina Central University in the City of Durham and
North Carolina State University in the City of Raleigh. The proximity of these universities makes the
Research Triangle area well suited for many types of research activities.
The Research Triangle Park (the "Park"), located 10 miles east of the County, contains 7,000 acres of land
which has been reserved for research and research-oriented manufacturing. Since its inception in the
1950's, more than 170 private and governmental organizations have located facilities in the Park.
According to the Research Triangle Foundation, the Park represents a capital investment exceeding $4.0
billion. As of July 2012, approximately 53,000 people were employed at the Park with an annual payroll
of approximately $4.5 billion with an average salary of $68,000. Approximately 87% of the employees in
the Park work for multinational corporations. Because of its close proximity to the County and the fact
that many of the Parks' employees reside in the County, the impact of the Park on the County's economy is
significant.
An industrial strip along Interstate Highway 85 in the western portion of the County is the location of
several manufacturing firms. This area is the projected location for future growth of industrial and
commercial concerns. In addition to this area, the County designated over 2,450 acres in three strategically
placed areas along Interstates 85 and 40 as Economic Development Districts. The County's location,
midway between the Piedmont Triad and Research Triangle metropolitan areas, makes these sites
extremely attractive. The districts offer development potential for light industrial, warehouse/flex space,
office, retail and business service. Numerous tracts, ranging in size from 20 to 100 acres or more, are
available.
Utility extension development is another economic development initiative undertaken by the County. This
project encourages economic development in the County by providing funds to finance utility extension
development for commercial entities. Using the monies in this fund, the County provides a portion of the
upfront water/sewer infrastructure costs for businesses. As the various projects are completed, some
portion of the resultant increased property tax revenue is used to repay the fund. These funds then
"revolve" to address water/sewer needs of other commercial development projects.
Fiscal Outlook.
The adopted 2012-13 budget included General Fund appropriation of $180.0 million,
which is an increase of $1.8 million from prior years' original budget, and a$5.2 million reduction from
the final amended budget. Reflective of previous fiscal years, the County continued its
traditional commitment to public schools earmarking nearly one-half of the County's 2010-11 General
Fund Budget of $180.0 million for education. Funding appropriated for education totaled $88.2 in the
fiscal year 2012-13 budget. The Board adopted and maintained aproperty tax rate of .858 cents per
hundred for Fiscal Year 2012-13 which represents the third straight year that the property tax rate was not
increased to balance the budget.The assessed value for the upcoming year is estimated to be nearly $15.9
billion with a tax rate of $0.858 per $100 of value year. There is only a nominal appropriation from fund
balance in the 2012-12 budget that will be used to assist in funding critical needs programs that have been
affected by the slow recovery from the current economic recession. The Board of County Commissioners
remains committed to grow and stabilize the fund balance as the County continues to contend with the flat
and declining revenues which have resulted from the continued recession. The Boards adoption of the
same property tax reflects their continued desire to not increase the burden on the citizens during these
difficult times. The County's financial condition remains strong and stable.
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Additionally the residents of Orange County in November of 2011 approved the Article 46 ¼ cents sales
tax that will be used for school capital projects in both school districts, Orange County Schools and
Chapel Hill Carrboro City Schools, and to foster economic development in the business development
zones of the County. The sales tax revenue is projected to be $2.5 million for fiscal year 2012-13.
For capital improvements, the County issued $25 million in Alternative Financing to fund the construction
th
of an 11elementary school for the Chapel Hill Carrboro School District and fund County equipment
purchases. The County does not plan to have any major capital projects or debt issuances for the 2012-13
fiscal years.
Fiscal Policy.
The County continues to operate within its current financial policies this fiscal year despite
the challenges it has faced during the economic recession and it is anticipated that it will continue to do so
in the upcoming fiscal year. The Board and County Manager acted during the year to hold down
expenditures to reduce the impact of the recession on the County's fiscal position. The actions primarily
took the form of delaying hiring for vacant positions and requesting that departments take action to reduce
operating expenses, fuel usage and travel. Although the 2012-12 budget has increased $2.9 million, the
Board of County Commissioners maintains their desire to have no tax increase in 2012-13. This means
that the County's debt service as a percentage of the budget will remain nearer or slightly above the 15%
of General Fund expenditures limit which is the goal the County strives to maintain. The Board has set an
available fund balance minimum of 8%; however it has a goal of being able to reach 17%. Over the past
several fiscal years the County has steadily moved toward this goal and had nearly reached it in fiscal year
2007-2008; this current fiscal year ended June 30, 2012, we have reversed the trend of reductions in fund
balance from the previous two fiscal years.
AWARDS AND ACKNOWLEDGEMENTS
The Government Finance Officers Association of the United States and Canada ("GFOA") awarded a
Certificate of Achievement for Excellence in Financial Reporting to Orange County for its Comprehensive
Annual Financial Report for the fiscal year ended June 30, 2011. This marks the thirtieth consecutive year
that Orange County has received this prestigious award. In order to be awarded a Certificate of
Achievement, a governmental unit must publish an easily readable and efficiently organized
Comprehensive Annual Financial Report, whose contents conform to program standards. Such reports
must satisfy both accounting principles generally accepted in the United States of America and applicable
legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe our current report
continues to conform to the Certificate of Achievement Program requirements and we are submitting it to
the GFOA to determine its eligibility for another certificate.
The County also received the GFOA's award for Distinguished Budget Presentation for its 2012 annual
budget document. This is the 21th year that the award has been presented to the County. In order to qualify
for this award, the County's budget document was judged to be proficient in several categories including
policy documentation, financial planning and organization. The Budget Department believes the fiscal
year 2012 budget continues to conform to program requirements and is submitting it to the GFOA to
determine eligibility for another award.
Each County department's strong commitment to the goals, vision and mission statements of the County
government is reflected in their provision of services to the residents of Orange County. I appreciate the
cooperation of all County departments in conducting financial activities, including the preparation of this
report. I would like to commend the members of the Finance Services Department, particularly, for their
professional competence and diligence in continuing the progressive financial activities of the County and
iv
the preparation of this informative report. Special recognition is extended to Howard Fitts, Accountant, for
his tireless effort and sense of commitment that he displayed throughout the report preparation process and
to Martin Starnes & Associates, Certified Public Accounts for their assistance.
I thank the Board of County Commissioners and County Manager for their leadership in making Orange County a
fiscally sound, well-governed community.
Respectfully submitted,
Clarence G. Grier, CPA, CITP
Financial Services Director
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vi
FY2011-12 Board of County Commissioners
Bernadette Pelissier - Chair
Valerie P. Foushee Alice M. Gordon
Pam Hemminger - Vice Chair
Barry Jacobs Earl McKee Steve Yuhasz
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Financial Section
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INDEPENDENT AUDITORS' REPORT
To the Board of County Commissioners
Orange County, North Carolina
We have audited the accompanying financial statements of the governmental activities, the
business-type activities, the discretely presented component unit, each major fund, and the
aggregate remaining fund information of Orange County, North Carolina, as of and for the year
ended June 30, 2012
listed in the table of contents. These financial statements are the responsibility of Orange
County's management. Our responsibility is to express an opinion on these basic financial
statements based on our audit. We did not audit the financial statements of the Orange County
ABC Board (the "Board") which represents 100% of the assets, net assets, and revenues of the
discretely presented component unit. Those financial statements were audited by another auditor
whose report thereon has been furnished to us, and our opinion, insofar as it relates to the
amounts included for the Board, is based solely on the report of the other auditor.
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
basic financial statements are free of material misstatement. The Board was not audited in
accordance with Government Auditing Standards. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by management
as well as evaluating the overall financial statement presentation. We believe that our audit and
the report of the other auditor provide a reasonable basis for our opinions.
In our opinion, based on our audit and the report of the other auditor, the financial statements
referred to above present fairly, in all material respects, the financial position of the
governmental activities, the business-type activities, the discretely presented component unit,
each major fund, and the aggregate remaining fund information of Orange County, North
Carolina, as of June 30, 2012, the respective changes in financial position and cash flows, where
appropriate thereof, and the respective budgetary comparison for the General Fund for the year
then ended in conformity with accounting principles generally accepted in the United States of
America.
730 13th Avenue Drive SE Hickory, North Carolina 28602 Phone 828-327-2727 Fax 828-328-2324
13 South Center Street Taylorsville, North Carolina 28681 Phone 828-632-9025 Fax 828-632-9085
Toll Free Both Locations 1-800-948-0585 Website: www.martinstarnes.com
In accordance with Government Auditing Standards, we have also issued our report dated November 20,
2012, on our consideration of Orange County's internal control over financial reporting and 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 the internal
control over financial reporting or on compliance. That report is an integral part of an audit prepared in
accordance with Government Auditing Standards and should be considered in assessing the results of our
audit.
Accounting principles generally accepted in the United States of America require that the Manageme
Discussion and Analysis and the Law Enforcement Officers' Special Separation Allowance and the Other
Post-
supplement the basic financial statements. Such information, although not a part of the basic financial
statements, is required by 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
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 assurance.
Our audit was performed for the purpose of forming opinions on the basic financial statements that
collectively comprise the basic financial statements of Orange County, North Carolina, as a whole. The
introductory section, combining and individual fund financial statements, budget and actual schedules,
supplemental ad valorem tax schedules, and statistical tables are presented for purposes of additional
analysis and are not a required part of the basic financial statements. The accompanying Schedule of
Expenditures of Federal and State Awards is presented for purposes of additional analysis as required by
U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-
Profit Organizations, and the State Single Audit Implementation Act, and is also not a required part of the
basic financial statements. The combining and individual fund financial statements, budget and actual
schedules, supplemental ad valorem tax schedules, and the Schedule of Expenditures of Federal and State
Awards 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. The information has been
subjected to the auditing procedures applied in the audit of the financial statements and certain other
procedures, including comparing and reconciling such information directly to the underlying accounting
and other records used to prepare the financial statements, or to the financial statements themselves, and
other additional procedures in accordance with auditing standards generally accepted in the United States
of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic
financial statements taken as a whole. The introductory section and statistical section have not been
subject to the auditing procedures applied in the audit of the basic financial statements and accordingly,
we express no opinion on them.
Martin Starnes & Associates, CPAs, P.A.
November 20, 2012
2
Orange County, North Carolina
this narrative overview and analysis of the financial activities of the County for the fiscal year ended June
30, 2012. We encourage readers to read the information presented here in conjunction with additional
Financial Highlights
The liabilities of the County exceeded its assets at the close of the fiscal year by $50.3 million (net
assets). In accordance with North Carolina law, liabilities of the County include approximately $149.2
million in long-term debt associated with assets belonging to the Orange County Board of Education and
the Chapel Hill-Carrboro City Board of Education. As these assets are not reflected in the County's
financial statements, and the full amount of the long-term debt is reflected in the County's financial
statements, the County reports a net deficit in net assets.
The government's total net assets increased by $9.85 million. This increase results from a reduction of
County expenditures/expenses to continue to deal with the results of, and the slow recovery from, the
economic recession.
As of the close of the current fiscal year, the County's governmental funds reported combined ending fund
balances of $88.5 million,an increase of $22.5 million in comparison with the prior year. This results
mainly from increased General Fund revenues and proceeds from debt financing and other sources of
capital project financing totaling $27 million in the current year. Approximately 39.1 percent of the
ending fund balance, or $34.6 million, is available for spending at the government's discretion
(unassigned fund balance). Of the total fund balance, approximately $6.1 million has been assigned for
subsequent year's expenditures for programs, grants, and capital purposes. Unassigned fund balance
totals $34.6 million.
At the end of the current fiscal year, unassigned fund balance for the General Fund was $35.1 million, or
21.1 percent of total General Fund expenditures for the fiscal year.
The County maintained its AAA (Fitch IBCA), Aa1 (Moody's Investor Services), and AA+ (Standard &
Poor's) bond rating on general obligation bonds for the 15th consecutive year.During the year, all of the
rating agencies s.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the County's basic financial
statements. The County's basic financial statements consist of three components: 1) government-wide
financial statements, 2) fund financial statements, and 3) notes to basic financial statements. The basic
financial statements present two different views of the County through the use of government-wide
statements and fund financial statements. In addition to the basic financial statements, this report contains
other supplemental information that will enhance the reader's understanding of the financial condition of
the County.
3
Orange County, North Carolina
Required Components of Annual Financial Report
Figure 1
Basic
Financial
Discussion and
Statements
Analysis
Government-Wide FundNotes to the
Financial Financial Financial
StatementsStatementsStatements
Summary Detail
Basic Financial Statements
Government-Wide Financial
The first two statements in the basic financial statements are the
Statements
. They provide both short and long-term information about the County's financial status.
Fund Financial Statements
The next statements are . These statements focus on the activities of the
individual parts of the County's government. These statements provide more detail than the government-
wide statements. There are four parts to the Fund Financial Statements: 1) the governmental funds
statements. 2) the budgetary comparison statements, 3) the proprietary fund statements, and 4) the
fiduciary fund statements.
4
Orange County, North Carolina
notes to the basic financial statements (notes)
The next section of the basic financial statements is the .
The notes explain in detail some of the data contained in those statements. After the notes, supplemental
information is provided to show additional major and nonmajor governmental
funds, proprietary and internal service funds, all of which are added together in one column on the basic
financial statements. Budgetary information required by the General Statutes also can be found in this
part of the statements.
Government-Wide Financial Statements
The government-wide financial statements are designed to provide the reader with a broad overview of
the County's finances, similar in format to a financial statement of a private-sector business. The
government-wide statements provide short and long-term information about the County's financial status
as a whole.
The two government-wide statements report the County's net assets and how they have changed. Net
assets are the difference between the County's total assets and total liabilities. Measuring net assets is one
way to gauge the County's financial condition.
The government-wide statements are divided into three categories: 1) governmental activities, 2)
business-type activities, and 3) component units. The governmental activities include most of the
County's basic services, such as general administration, taxation and records, community planning,
community maintenance, human services, education, public safety, and public works. Property and other
taxes and Federal and State grant funds finance most of these activities. The business-type activities are
those that the County charges customers to provide a related service. These include the sewer and landfill
services and recreational services offered by the County. The final category is the component units.
Although legally separate from the County, the ABC Board is important to the County because the
County exercises control over the Board by appointing its members and because the Board is required to
distribute its profits to the County.
The government-wide financial statements are on pages 16 through 18 of this report.
Fund Financial Statements
The fund financial statements provide a more detailed look at the County's most significant activities. A
fund is a grouping of related accounts that is used to maintain control over resources that have been
segregated for specific activities or objectives. The County, like all other governmental entities in North
Carolina, uses fund accounting to ensure and reflect compliance (or non-compliance) with finance-related
legal requirements, such as the General Statutes or the County's budget ordinance. All of the funds of the
County can be divided into three categories: governmental, proprietary, and fiduciary funds.
Governmental Funds.
Governmental funds are used to account for those functions reported as
governmental activities in the government-wide financial statements. Most of the County's basic services
are accounted for in governmental funds. These funds focus on how assets can readily be converted into
cash flow in and out, and what monies are left at year-end that will be available for spending in the next
year. Governmental funds are reported using an accounting method called modified accrual accounting,
which provides a current financial resources focus. As a result, the governmental fund financial
5
Orange County, North Carolina
statements give the reader a detailed short-term view that helps him or her determine if there are more or
less financial resources available to finance the County's programs. The relationship between
governmental activities (reported in the Statement of Net Assets and the Statement of Activities) and
governmental funds is described in a reconciliation that is a part of the fund financial statements.
The County adopts an annual budget for its General Fund, as required by the General Statutes. The
budget is a legally adopted document that incorporates input from the citizens of the County, the
management of the County, and the decisions of the Board about which services to provide and how to
pay for them. It also authorizes the County to obtain funds from identified sources to finance these
current period activities. The budgetary statements provided for the General Fund demonstrate how well
the County complied with the budget ordinance and whether or not the County succeeded in providing the
services as planned when the budget was adopted. The budgetary comparison statements use the
budgetary basis of accounting and are presented using the same format, language, and classifications as
the Statement of Revenues, Expenditures, and Changes in Fund Balance. The statement shows four
columns: 1) the original budget as adopted by the Board, 2) the final budget as amended by the Board, 3)
the actual resources, charges to appropriations, and ending balances in the General Fund, and 4) the
difference or variance between the final budget and the actual resources and charges.
Proprietary Funds.
The County has three kinds of proprietary funds. Enterprise funds are used to report
the same functions presented as business-type activities in the government-wide financial statements. The
County uses enterprise funds to account for its sewer activity, for its landfill operations, and SportsPlex
operations. These funds are the same as those functions shown in the business-type activities in the
Statement of Net Assets and the Statement of Activities. Internal service funds are an accounting device
used to accumulate and allocate costs internally among the functions of the County. The County uses an
Internal Service Fund to account for one activity - its employee dental insurance program. Because this
operation benefits predominantly governmental rather than business-type activities, the Internal Service
Fund has been included within the governmental activities in the government-wide financial statements.
Fiduciary Funds.
Fiduciary funds are used to account for assets the County holds on behalf of others.
seven agency funds.
Notes to Basic Financial Statements.
The notes provide additional information that is essential to a full
understanding of the data provided in the government-wide and fund financial statements. The notes to
basic financial statements are on pages 28-70 of this report.
Other Information.
In addition to the basic financial statements and accompanying notes, this report
includes certain required supplementary information concerning the County's progress in funding its
obligation to provide pension benefits to its employees. Required supplementary information can be
found beginning on page 71 of this report.
6
Orange County, North Carolina
As noted earlier, net assets may serve, over time, as one useful indicator of a government's financial
condition. The liabilities of the County exceeded assets by $50.3 million as of June 30, 2012. Net assets
are reported in three categories: invested in capital assets, net of related debt, of $39.8 million; restricted
nets assets of $38.7 million; and unrestricted net deficit of $128.7 million.
The invested in capital assets, net of related debt, category is defined as the County's investment in
County-owned capital assets (e.g. land, buildings, automotive equipment, office and other equipment, and
sewer lines), less any related debt still outstanding that was issued to acquire those items. The County
uses these capital assets to provide services to citizens; consequently, these assets are not available for
future spending. Although the County's investment in its capital assets is reported net of the outstanding
related debt, the resources needed to repay that debt must be provided by other sources, since the capital
assets cannot be used to liquidate these liabilities. At June 30, 2012, the investment in capital assets, net
of related debt,decreased by $217,005.
The final category of net assets is unrestricted net assets. This balance may be used to meet the
government's ongoing obligations to citizens and creditors. At June 30, 2012, the total net deficit reported
of $50.3 million is attributable to the unrestricted net deficit balance of ($128.7) million, which results
from the debt financing related to school assets.
As with many counties in the State of North Carolina, the County's deficit in unrestricted net assets is due
primarily to the portion of the County's outstanding debt incurred for the two school systems located
within the County. Under North Carolina law, the County is responsible for providing capital funding for
the school systems. The County has chosen to meet its legal obligation to provide the school systems'
capital funding by using a mixture of County funds and general obligation debt. The assets funded by the
County, however, are owned and utilized by the school systems. Since the County, as the issuing
government, acquires no capital assets, the County has incurred a liability without a corresponding
increase in assets. At the end of the fiscal year, approximately $149.2 million of the outstanding debt on
statements. The majority of this school system related debt is general obligation debt, which is
7
Orange County, North Carolina
collateralized by the full faith credit, and taxing power of the County. Accordingly, the County is
authorized and required by State law to levy ad valorem taxes, without limit as to rate or amount, as may
be necessary to pay the debt service on its general obligation bonds. Principal and interest requirements
will be provided by an appropriation in the year in which such requirements become due. The majority of
the non-general obligation debt is repaid from a combination of school systems impact fees, sales taxes
earmarked for school capital, education lottery proceeds, and ad valorem property taxes allocated to
school capital.
As noted earlier, the government's total net assets increased by $9.85 million. This increase resulted from
a combination of an increase in revenues in governmental activities and adecrease in expenses. This was
in part, offset by an increase in expenses in business activities.In addition, the following positive
operational initiatives and results are noted:
in the collection of property taxes by maintaining a collection
percentage of approximately 99%, higher than the State-wide average of 97%.
Sales taxes exceeded budget by $2.3 million due to the slow, but steady, rec
Recession.
The County continued to lead the State in per pupil funding for education.
th
The County issued limited obligation bonds to finance the construction of an 11 elementary school
for the Chapel HillCarrboro City School District and purchase of EMS vehicles.
The unassigned fund balance in the County's General Fund reflected anincrease of $7.4 million from
the prior year. This increase occurred primarily from increased property and sales tax collections and
acontinued focus on decreasing expenditures.Unassigned fund balance is expected to increase in
future fiscal years as the Board has committed to increasing fund balance with the return of improved
economic conditions.
8
Orange County, North Carolina
Governmental Activities.
Governmental activities increased the County's net assets by $9.6 million.
Key elements of this increase are as follows:
Increased property tax revenue
Increased sales tax and other revenues
Nominal increases in functional expenditures
Decreased expenditures for interest on debt due to refunding and extinguishing debt.
9
Orange County, North Carolina
Business-Type Activities.
Business-type activities increased the County's net assets by only $284,874.
This increase came from increases in operating income in each of the three business activities combined
with increases in operating transfers.
Financial Analysis of the County's Funds
As noted earlier, the County uses fund accounting to ensure and demonstrate compliance with finance-
related legal requirements.
Governmental Funds.
The focus of the County's governmental funds is to provide information on near-
term inflows, outflows, and balances of usable resources. Such information is useful in assessing the
County's financing requirements. Specifically, available fund balance can be a useful measure of a
government's net resources available for spending at the end of the fiscal year.
The General Fund is the chief operating fund of the County. At the end of the current fiscal year,
unassigned balance of the General Fund was $35.1 million, while total fund balance equaled $47.9
million. As a measure of the General Fund's liquidity, it may be useful to compare both unassigned fund
balance and total fund balance to total fund expenditures and transfers. Unassigned fund balance
represents 20 percent of total General Fund expenditures and transfers, while the total fund balance
represents 27.3 percent of General Fund expenditures and transfers. The increase in fund balance resulted
from revenues exceeding expenditures and transfers by $10.6million.
General Fund revenue at $184.5 million was higher than the final amended budget. Property tax revenue
makes up 74% of General Fund budgeted revenue. The General Fund revenue was $4.2 million more
than budget. Property tax increased by $1.8 million from last year, or 1.4% from last year, primarily due
to a 1.1% increase in the property tax base, increased collections of property taxes on registered motor
vehicles and discoveries, which caused property tax revenues to exceed the budget by $3.4 million.
Intergovernmental revenue, the second largest revenue source for the General Fund, decreased marginally
largely reflecting decreases in Federal and State grant revenue related to the continued budgetary issues at
the Federal and State levels due to the slow recovery of the economy.Sales tax revenue, which is the
third largest revenue source, increased by $2.3 million from last year to $17.5 million. This increase was
due largely from receiving more sales tax revenues as the economy recovers from the economic recession.
Charges for services, licenses and permits, investment income, and miscellaneous revenues all came in
either slightly higher or lower than budget.The total amount relative to budget was $87,110 lower than
the amended budget for the year.
General Fund expenditures decreased $8.8 million from last year to $175.5 million.Expenditures,
without financing uses, were $8.6 million, or 5.0% under budget, which is higher than last year which
was 3.0% below budget. This can be attributed, in part, to managemen continued directive to
departments to reduce non-essential expenditures, an extended freeze on capital expenditures, and
continued delay in filling of vacant positions. This step assisted in the increase of unassigned fund
balance of the General Fund.Total expenditures with other financing uses decreased by 6% from the
previous fiscal year, which is less than the increase in the final budget from the prior year of 4.3%.
10
Orange County, North Carolina
Expenditures for debt service decreased the largest this fiscal year due to recent refunding and refinancing
of general obligation and alternative financing debt. Slight increases incurred in other functional
expenditure categories due to efforts to consolidate departments and the increasing staff levels in all
departments.
The County Capital Improvement Fund reflected a decrease in fund balance of $3.1 million; the School
Capital Improvement Fund reflected an increase in fund balance of $14.3 million.The decrease in the
County Capital Project Fund is primarily a result of expending proceeds from the prior year debt
issuances and the expenditures on a variety of County capital projects. The School Capital Project Fund
increase was primarily the result of the receipt of $5.5 million from the transfer of pay-as-you-go revenue
from the General Fund, and $21.5 million of proceeds from Limited Obligation Bonds issued to finance
th
the construction of an 11 elementary school for the Chapel HillCarrboro City School District offset by
project expenditures. Lottery proceeds of $2.2 million were used to pay school related debt service in the
General Fund during the fiscal year.
As of June 30, 2012, the nonmajor governmental funds of the County reported a combined fund balance
of $7.3 million, anincrease of $702,678 from last year. This increase is attributable mainly to receipt of
new grant funds and other sources in the various nonmajor governmental funds netted with reduced
expenditures for older programs being closed during the fiscal year.
Proprietary Funds.
As mentioned previously in business-type activities, the net assets in the enterprise
funds decreased by $284,874. This decrease came primarily from increases in operating losses in each of
the three business activities combined with decreases in operating transfers and the fact that there was no
capital contribution. Revenue decreased slightly in all proprietary funds, but these increases were offset
by increases in all three enterprise funds. The most significant increase in expenses relates to post-closure
costs in the Solid Waste Enterprise Fund which went up by $1.8 million.
General Fund Budgetary Highlights.
During the 2012 budget year, the County had several noteworthy
operational milestones in the area of General Fund operations. Once again, the County's annual
contribution to public schools placed the County at the top of the rankings per pupil in expenditures
among North Carolina's 100 counties.The Orange County and Chapel HillCarrboro City Schools
continued to use these funds very effectively, compiling overall impressive results in student achievement
tests and solidifying the reputations of both systems as excellent learning environments for young people.
In fiscal year 2012, the County's contribution to education funding, including operations, short and long-
range capital needs and debt service obligations, totaled $93.4 million, over 43.2 percent of the total
governmental funds expenditures for the year.
11
Orange County, North Carolina
The County revised the budget on several occasions. Generally, budget amendments fall into one of four
categories: 1) amendments made to adjust the estimates that are used to prepare the original budget
ordinance once exact information is available, 2) carryover of funding for outstanding purchase orders at
year-end related to significant commitments and projects, 3) amendments made to recognize new funding
amounts from external sources, such as Federal and State grants, and 3) increases in appropriations that
become necessary to maintain services. In 2012, an additional appropriation from fund balance during
the year of $2.2 million was provided additional funding for school related capital projects. Total
amendments to the General Fund increased appropriations by approximately $7.0 million.
Proprietary Funds.
The County's proprietary funds provide the same type of information found in the
government-wide statements, but in more detail. Unrestricted net assets in the proprietary funds at the
end of the fiscal year amounted to $2,753,608. As previously indicated, the decrease in net assets for the
proprietary funds was $284,874. The primary factors affecting the decrease in these funds were
addressed in the discussion of the County's business-type activities.
Capital Asset and Debt Administration
Capital Assets.
The County's investment in capital assets for its governmental and business-type
activities as of June 30, 2012 totals $120.9 million (net of accumulated depreciation). These assets
include land, buildings, automotive equipment, office and other equipment, and sewer lines.
The County Capital Assets
(Net of depreciation)
Major capital asset transactions during the year include:
Purchased construction in progress on various County and school projects.
Purchased ambulances.
Purchased various office equipment for day-to-day operations.
Purchased landfill equipment and convenience center upgrades.
12
Orange County, North Carolina
Additional information on the County's capital assets can be found in Note 3 of the Basic Financial
Statements.
Long-Term Debt and Obligations.
As of June 30, 2012, the County had total bonded debt outstanding
of $95.5 million, all of which is debt backed by the full faith credit of the County. In addition, the County
has several capital leases related to equipment financings outstanding of $3.1 million and several
installment notes with a total outstanding balance of $124.6 million. A summary of total long-term debt
and other long-term liabilities is shown in Figure 5.
The County's Long-Term Obligations
The County's totallong-term debt and obligations increased by $19.1 million, or 7.3% during the past
fiscal year. The increase is mainly due to net of proceeds received for limited obligation bonds of $25
million, increases in OPEB liability of $3.5 million, and increases in the post-closure liability for the
landfill of $1.8, net principal payments for the outstanding debt obligations.
The County's most recent bond ratings, received in connection with the general obligation refunding
bonds issued in March 2012, are shown below:
Moody's Investor Services Aa1
Standard & Poor's AA+
Fitch IBCA AAA
These bond ratings are a clear indication of the sound financial condition of the County. The County is
one of the few counties in the country that maintains the highest financial ratings from all major rating
agencies. This achievement is a primary factor in keeping interest costs low on the County's outstanding
debt.
The State of North Carolina limits the amount of general obligation debt that a unit of government can
issue to 8 percent of the total assessed value of taxable property located within that government's
boundaries. The legal debt margin for the County is approximately $1 billion. The County has $223.2
million total net debt applicable to the limit. The County has $23,900,000 in bonds authorized, but
unissued, at June 30, 2012.
13
Orange County, North Carolina
Additional information regarding the County's long-term debt can be found in Note 6 on pages 58-64 of
this report.
Economic Factors and Next Year's Budgets and Rates
The County's economy is characterized by a high degree of institutional and public-sector activity, plus
office, commercial, and service-oriented businesses. Manufacturing and agriculture are smaller portions
of the County's economy.
The County enjoys a consistently low unemployment rate. The unemployment rate estimated by the
North Carolina Employment Security Commission for September 2012 was 6.3%, one of the lowest in the
State.
The University of North Carolina at Chapel Hill and University hospitals in the Town of Chapel Hill and
their associated service, teaching, and research programs have a reputation for excellence in the
educational and medical fields.
The County is also the place of residence for many technical, professional, and executive people who
work in the Research Triangle Park and neighboring cities of Durham, Raleigh, and Burlington.
The Research Triangle refers to an area located among three municipalities: Chapel Hill, Durham, and
Raleigh. In addition to the University of North Carolina at Chapel Hill, universities located in these
municipalities include Duke University, North Carolina Central University in the City of Durham, and
North Carolina State University in the City of Raleigh. The proximity of these universities makes the
Research Triangle area well suited to many types of research activities.
land, which has been reserved for research and research-oriented manufacturing. Since its inception in
the 1950s, over 145 private and governmental organizations have located facilities in the Park.
According to the Research Triangle Foundation, the Park represents a capital investment exceeding $2.8
billion. As of June 2012, approximately 42,000 people were employed at the Park with an annual payroll
of approximately $2.7 billion with an average salary of $57,500. Approximately 82% of the employees in
the Park work for multi-national corporations. Because of its close proximity to the County and the fact
that man
is significant.
Budget Highlights for the Fiscal Year Ending June 30, 2013
Governmental Activities.
The County has approved a $180.0 million General Fund budget for fiscal
year 2013 which represents a $1.8 million, or 1.1%, increase from fiscal year 2012. This budget was
balanced by not increasing the property tax rate for the upcoming fiscal year. This was the fourth time in
twenty years property taxes were not increased. The budgeted per pupil allocation for education was
increased to $3,167, which represents a $65.00 per pupil increase from the previous year allocation of
$3,096.
14
Orange County, North Carolina
Additionally, the residents of Orange County in November of 2011 approved the Article 46 ¼ cents sales
tax that will be used for school capital projects in both school districts, Orange County Schools and
Chapel Hill Carrboro City Schools, and to foster economic development in the business development
zones of the County. The sales tax revenue is projected to be $2.5 million for fiscal year 2012-13.
In reference to business-type activities, those budgets were increasedby $2.8 million. Themajority of the
increase was in the Solid Waste Enterprise Fund. In fiscal year 2013, the County will close the landfill
and will incur approximately $3.1 million of expenditures.
Requests for Information
This report is designed to provide an overview of the County's finances for those with an interest in this
area. Questions concerning any of the information found in this report or requests for additional
information should be directed to the Director of Financial Services for the County, 200 South Cameron
Street, P.O. Box 8181, Hillsborough, North Carolina 27278.
Complete financial statements for the ABC Board may be obtained at its administrative office, Orange
County ABC Board, 122 Highway 70 East, Hillsborough, North Carolina 27278.
15
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Basic Financial Statements
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Exhibit A
ORANGE COUNTY, NORTH CAROLINA
STATEMENT OF NET ASSETS
JUNE 30, 2012
ComponentReporting
Primary Government
UnitUnit
GovernmentalBusiness-TypeOrange County
ActivitiesActivitiesTotalABC BoardTotal
Assets:
Cash and investments53,383,724$ 16,153,965$ 69,537,689$ 1,625,538$ 71,163,227$
Receivables, property taxes, net2,915,769 - 2,915,769 - 2,915,769
Receivables, federal intergovernmental320,318 - 320,318 - 320,318
Receivables, State intergovernmental8,452,561 64,455 8,517,016 - 8,517,016
Receivables, other2,212,149 295,773 2,507,922 2,275 2,510,197
Inventories17,788 - 17,788 1,404,190 1,421,978
Internal balances202,983 (202,983) - - -
Prepaid expenses16,946 16,790 33,736 93,459 127,195
Restricted assets:
Cash and investments33,094,025 3,000,000 36,094,025 - 36,094,025
Other assets871,523 - 871,523 10,747 882,270
Capital assets:
Non-depreciable33,504,038 2,266,733 35,770,771 1,085,776 36,856,547
Depreciable, net72,205,090 12,920,420 85,125,510 1,503,673 86,629,183
34,515,153207,196,914 241,712,067 5,725,658 247,437,725
Total assets
Liabilities:
Accounts payable3,561,065 554,706 4,115,771 474,927 4,590,698
Payroll withholdings2,612,221 192,315 2,804,536 - 2,804,536
Accrued liabilities3,454,945 119,954 3,574,899 434,944 4,009,843
Arbitrage payable39,376 - 39,376 - 39,376
Unearned revenues379,620 180,806 560,426 - 560,426
Long-term liabilities:
Due within one year19,345,126 1,313,186 20,658,312 - 20,658,312
24,995,598235,233,104 260,228,702 - 260,228,702
Due in more than one year
27,356,565264,625,457 291,982,022 909,871 292,891,893
Total liabilities
Net Assets:
Invested in capital assets, net of
related debt35,398,235 4,404,980 39,803,215 2,589,449 42,392,664
Restricted for:
Stabilization by State statute11,153,113 - 11,153,113 - 11,153,113
Education25,359,245 - 25,359,245 - -
Public safety979,080 - 979,080 - -
Community and environment1,164,894 - 1,164,894 - -
2,753,608(131,483,110) (128,729,502) 2,226,338 (126,503,164)
Unrestricted
$ 7,158,588(57,428,543)$$(50,269,955)$ (45,454,168)4,815,787$
Total net assets
The accompanying notes are an integral part of the financial statements.
ORANGE COUNTY, NORTH CAROLINA
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2012
Program Revenues
OperatingCapital
Charges forGrants andGrants and
ExpensesServicesContributionsContributions
Functions/Programs:
Primary Government:
Governmental Activities:
Governing and management$ 23,497,848$ 2,318,029$ 847,520$ -
General Services7,222,7703,123,483577,1533,016,864
Community and environment9,786,774201,9264,964,638
Human services33,431,3091,512,33116,385,082725,402
Education76,639,902-33,7592,333,235
Public safety23,717,8465,331,137476,619-
Cultural and recreational2,168,615279,360118,626-
14,479,651---
Interest on long-term debt
190,944,71512,766,26623,403,3976,075,501
Total governmental activities
Business-Type Activities:
Landfill10,552,4208,346,142419,354-
Sewer316,684146,202--
2,909,1202,785,702--
SportsPlex
13,778,22411,278,046419,354-
Total business-type activities
$ 204,722,939$ 24,044,312$ 23,822,751$ 6,075,501
Total primary government
Component Unit:
$ 15,003,037$ 15,448,930$ -$ -
ABC Board
General Revenues:
Property taxes
Sales tax
Occupancy tax
Unrestricted investment earnings
Total general revenues
Transfers
Total general revenues and transfers
Change in net assets
Net Assets:
Beginning of year - July 1
End of year - June 30
The accompanying notes are an integral part of the financial statements.
17
Exhibit B
Net (Expense) Revenue and Changes in Net Assets
ComponentReporting
Primary Government
UnitUnit
GovernmentalBusiness-TypeOrange County
ActivitiesActivitiesTotalABC BoardTotal
$ (20,332,299)$ -$ (20,332,299)$ -$ (20,332,299)
(505,270)-(505,270)-(505,270)
(4,620,210)-(4,620,210)-(4,620,210)
(14,808,494)-(14,808,494)-(14,808,494)
(74,272,908)-(74,272,908)-(74,272,908)
(17,910,090)-(17,910,090)-(17,910,090)
(1,770,629)-(1,770,629)-(1,770,629)
(14,479,651)-(14,479,651)-(14,479,651)
(148,699,551)-(148,699,551)-(148,699,551)
-(1,786,924)(1,786,924)-(1,786,924)
-(170,482)(170,482)-(170,482)
-(123,418)(123,418)-(123,418)
-(2,080,824)(2,080,824)-(2,080,824)
(148,699,551)(2,080,824)(150,780,375)-(150,780,375)
---445,893445,893
141,596,821-141,596,821-141,596,821
17,233,583-17,233,583-17,233,583
1,038,383-1,038,383-1,038,383
756,38210,067766,4495,076771,525
160,625,16910,067160,635,2365,076160,640,312
(2,355,631)2,355,631---
158,269,5382,365,698160,635,2365,076160,640,312
9,569,987284,8749,854,861450,96910,305,830
(66,998,530)6,873,714(60,124,816)4,364,818(55,759,998)
$ (57,428,543)$ 7,158,588$ (50,269,955)$ 4,815,787$ (45,454,168)
The accompanying notes are an integral part of the financial statements.
18
Exhibit C
Page 1 of 2
ORANGE COUNTY, NORTH CAROLINA
BALANCE SHEET - GOVERNMENTAL FUNDS
JUNE 30, 2012
Nonmajor
Major Funds
Funds
CountySchoolOther Total
CapitalCapitalGovernmentalGovernmental
GeneralImprovementsImprovementsFundsFunds
Assets:
Cash and investments$ 44,800,371$ 23,586$ 1,749,001$ 6,098,981$ 52,671,939
Accounts receivable,
property taxes, net2,820,166--95,6032,915,769
Accounts receivable, federal311,721--8,597320,318
Accounts receivable, State6,634,6471,062,032-755,8828,452,561
Accounts receivable, other338,811--1,873,3382,212,149
Inventories17,788---17,788
Due from other funds366,09666,983--433,079
Prepaids16,946---16,946
1,083,7136,651,06725,359,245-33,094,025
Restricted cash and investments
$ 56,390,259$ 7,803,668$ 27,108,246$ 8,832,401$ 100,134,574
Total assets
Liabilities:
Accounts payable$ 1,853,107$ 272,951$ 1,254,066$ 154,170$ 3,534,294
Accrued payroll and withholdings2,612,221---2,612,221
Accrued liabilities867,115---867,115
Due to other funds---230,096230,096
Arbitrage payable-14,63724,739-39,376
3,198,310--1,160,7384,359,048
Deferred revenue
8,530,753287,5881,278,8051,545,00411,642,150
Total liabilities
Fund Balances:
Non-spendable:
Prepaid items16,946---16,946
Inventories17,788---17,788
Restricted for:
Stabilization for State statute8,399,0621,129,015-1,625,03611,153,113
Restricted, all other921,5256,651,06725,359,2452,143,97435,075,811
Committed145,919-470,196869,6801,485,795
Assigned3,212,872--2,903,6616,116,533
35,145,394(264,002)-(254,954)34,626,438
Unassigned
47,859,5067,516,08025,829,4417,287,39788,492,424
Total fund balances
$ 56,390,259$ 7,803,668$ 27,108,246$ 8,832,401$ 100,134,574
Total liabilities and fund balances
The accompanying notes are an integral part of the financial statements.
19
Exhibit C
Page 2 of 2
ORANGE COUNTY, NORTH CAROLINA
BALANCE SHEET - GOVERNMENTAL FUNDS
JUNE 30, 2012
Total
Governmental
Funds
Amounts reported for governmental activities in the Statement of Net Assets are different because:
Ending fund balance - governmental funds$ 88,492,424
Capital assets used in governmental activities are not financial resources
and, therefore, are not reported in the funds.105,709,128
Other long-term assets are not available to pay for current period expenditures and,
therefore, are deferred in the funds.3,979,428
Accrued liabilities that do not pay for current financial obligations are not recorded in
the governmental funds. This is the amount of accrued interest on long-term debt.(2,587,830)
Governmental funds report the effect of issuance costs, premiums, discounts, and
similar items when debt is first issued; whereas, these amounts are deferred and
amortized in the Statement of Activities. This is the amount of the deferred loan
costs from the cost to issue debt.871,523
Internal service funds are used by management to charge the costs of dental insurance
to individual funds. The assets and liabilities of the internal service funds are included in
governmental activities in the Statement of Net Assets.685,014
Long-term liabilities, including bonds payable and other post-employment benefits, are
(254,578,230)
not due and payable in the current period and, therefore, are not reported in the funds.
$ (57,428,543)
Net assets of governmental activities
The accompanying notes are an integral part of the financial statements.
20
Exhibit D
ORANGE COUNTY, NORTH CAROLINA
STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Nonmajor
Major Funds
Funds
CountySchoolOtherTotal
Capital Capital GovernmentalGovernmental
GeneralImprovementsImprovementsFundsFunds
Revenues:
Property taxes$ 136,485,507$ -$ -$ 4,656,071$ 141,141,578
Sales tax17,562,303--709,66318,271,966
Intergovernmental revenues19,794,0263,016,864-5,778,07228,588,962
Charges for services9,406,210--687,87110,094,081
Investment earnings51,291693,1407,4384,373756,242
Licenses and permits329,265--329,265
-
Impact fees---1,648,2351,648,235
Asset management---63,57563,575
824,545171,78033,759365,0151,395,099
Miscellaneous
184,453,1473,881,78441,19713,912,875202,289,003
Total revenues
Expenditures:
Current:
Governing and management11,946,149---11,946,149
General services5,602,554--953,5106,556,064
Community and environment5,613,530--6,694,76612,308,296
Human services32,276,333--385,25232,661,585
Education63,939,903---63,939,903
Public safety18,875,222--4,188,42323,063,645
Culture and recreation2,078,964---2,078,964
Capital outlay-7,079,94812,699,999-19,779,947
Debt service:
Principal18,718,055---18,718,055
7,745,0707,535,123--15,280,193
Interest and fees
166,795,78014,615,07112,699,99912,221,951206,332,801
Total expenditures
Revenues over (under) expenditures17,657,367(10,733,287)(12,658,802)1,690,924(4,043,798)
Other Financing Sources (Uses):
Bond premium-14,195,360--14,195,360
Refunding bonds-96,693,500--96,693,500
Installment loan issuances531,500-21,500,000-22,031,500
Payment to escrow agent-(104,030,089)--(104,030,089)
Transfers in1,040,000783,2435,453,620386,6487,663,511
(8,654,248)--(1,374,894)(10,029,142)
Transfers out
(7,082,748)7,642,01426,953,620(988,246)26,524,640
Total other financing sources (uses)
Net change in fund balances10,574,619(3,091,273)14,294,818702,67822,480,842
Fund Balances:
37,284,88710,607,35311,534,6236,584,71966,011,582
Beginning of year - July 1
$ 47,859,506$ 7,516,080$ 25,829,441$ 7,287,397$ 88,492,424
End of year - June 30
The accompanying notes are an integral part of the financial statements.
21
Exhibit E
ORANGE COUNTY, NORTH CAROLINA
RECONCILIATION OF THE STATEMENT OF
REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES -
GOVERNMENTAL FUNDS - TO THE STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2012
Amounts reported for governmental activities in the Statement of Activities (Exhibit B)
are different because:
Net change in fund balances - total governmental funds (Exhibit D)$ 22,480,842
Governmental funds report capital outlays as expenditures. However, in the Statement
of Activities, the cost of those assets is allocated over their estimated useful lives and
reported as depreciation expense. The components of the change are as follows:
Capital outlay5,241,065
Depreciation expense(4,369,158)
Other capital adjustments(53,884)
Revenues in the Statement of Activities that do not provide current financial resources
are not reported as revenues in the funds.
Change in deferred revenue455,243
Governmental funds report the effect of issuance costs, premiums, discounts, and similar
items when debt is first issued, whereas, these amounts are deferred and amortized in the
Statement of Activities. This amount is the net effect of these differences in the treatment
of long-term debt and related accounts.(164,369)
Expenses in the Statement of Activities that do not pay for current financial obligations are
not reported as expenditures in the governmental funds. This adjustment is the amount of
accrued interest on long-term debt.501,029
The issuance of long-term debt provides for current financial resources of governmental
funds. This amount is the proceeds on debt issuances recoded in the governmental funds.(28,426,389)
The repayment of the principal of long-term debt consumes the current financial resources
of governmental funds. This amount is the principal payments recorded in the governmental
funds.18,718,055
Expenses related to OPEB liability, compensated absences, and net pension obligation in
the Statement of Activities that do not pay for current financial obligations are not reported
as expenditures in the governmental funds. This adjustment is the amount of change in these
balances in the current year.(5,218,630)
The internal service funds are used by management to charge
406,183
the costs of dental insurance and OPC retiree health insurance.
$ 9,569,987
Change in net assets of governmental activities
The accompanying notes are an integral part of the financial statements.
22
Exhibit F
ORANGE COUNTY, NORTH CAROLINA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance With
Budgeted Amounts
Final Budget
OriginalFinalActualOver/(Under)
Revenues:
Property taxes$ 133,081,175$ 133,081,175$ 136,485,507$ 3,404,332
Sales tax15,283,79015,283,79017,562,3032,278,513
Intergovernmental revenues16,540,40521,156,40119,794,026(1,362,375)
Charges for services9,392,2179,480,6039,406,210(74,393)
Investment earnings140,000140,00051,201(88,799)
Licenses and permits313,000313,000329,26516,265
699,001764,728824,54559,817
Miscellaneous
175,449,588180,219,697184,453,0574,233,360
Total revenues
Expenditures:
Governing and management14,072,86113,929,64911,946,149(1,983,500)
General services6,089,2156,254,7785,602,554(652,224)
Community and environment5,927,0496,095,9325,520,835(575,097)
Human services32,523,91635,300,90432,276,333(3,024,571)
Education63,939,90363,939,90363,939,903-
Public safety19,699,37920,322,96018,875,222(1,447,738)
Cultural and recreational2,093,9952,145,7592,078,964(66,795)
Debt service:
Principal18,668,93518,668,93518,718,05549,120
8,686,7198,686,7197,745,070(941,649)
Interest and fees
171,701,972175,345,539166,703,085(8,642,454)
Total expenditures
Revenues over (under) expenditures 3,747,6164,874,15817,749,97212,875,814
Other Financing Sources (Uses):
Capital lease issuance531,600574,484531,500(42,984)
Transfers in1,064,9171,064,9171,040,000(24,917)
Transfers out(6,475,550)(9,864,248)(8,839,248)1,025,000
1,131,4173,350,689-(3,350,689)
Appropriated fund balance
(3,747,616)(4,874,158)(7,267,748)(2,393,590)
Total other financing sources (uses)
Net change in fund balance$ -$ -10,482,224$ 10,482,224
Fund Balance:
37,231,363
Beginning of year - July 1
$ 47,713,587
End of year - June 30
The accompanying notes are an integral part of the financial statements.
23
Exhibit G
ORANGE COUNTY, NORTH CAROLINA
PROPRIETARY FUNDS
STATEMENT OF NET ASSETS
JUNE 30, 2012
Internal Service Funds
Major
Nonmajor
TotalDentalOPC
Solid WasteSportsPlexEfland SewerEnterpriseInsuranceRetiree Health
FundFundFundFundsFundFund
Assets:
Current assets:
Cash and cash equivalents14,833,852$ 1,156,912$ 163,201$ 16,153,965$ 201,779$ 510,006$
Accounts receivable, state64,455 - - 64,455 - -
Accounts receivable, other214,204 81,569- 295,773 - -
Prepaid expenses
16,790- - 16,790 - -
-3,000,000 - 3,000,000 - -
Restricted cash and investments
1,255,27118,112,511 163,201 19,530,983 201,779 510,006
Total current assets
Non-current assets:
Non-depreciable assets1,617,824 591,792 57,117 2,266,733 - -
5,788,1184,591,050 2,541,252 12,920,420 - -
Capital assets, net of depreciation
6,379,9106,208,874 2,598,369 15,187,153 - -
Total non-current assets
7,635,18124,321,385 2,761,570 34,718,136 201,779 510,006
Total assets
Liabilities and Net Assets:
Liabilities:
Current liabilities:
Accounts payable475,009 46,33133,366554,706 26,771-
Payroll withholdings174,999 17,316- 192,315 - -
Accrued liabilities24,687 - - 24,687 - -
Accrued interest56,61438,653- 95,267 - -
Due to other funds- - 202,983202,983 - -
Unearned revenues- 180,806- 180,806 - -
Current portion of long-term debt494,384 600,937 - 1,095,321 - -
-217,865 - 217,865 - -
Compensated absences, current portion
884,0431,443,558 236,349 2,563,950 26,771 -
Total current liabilities
Non-current liabilities:
Compensated absences 145,243 - - 145,243 - -
Post-closing liability13,741,104 - - 13,741,104 - -
OPEB liability1,422,399 - - 1,422,399 - -
4,814,1474,872,705 - 9,686,852 - -
Long-term debt
4,814,14720,181,451 - 24,995,598 - -
Total non-current liabilities
5,698,19021,625,009 236,349 27,559,548 26,771 -
Total liabilities
Net Assets:
Invested in capital assets,
net of related debt841,785 964,826 2,598,369 4,404,980 - -
972,1651,854,591 (73,148) 2,753,608 175,008 510,006
Unrestricted
$ 1,936,9912,696,376$$2,525,221$7,158,588$ 510,006175,008$
Total net assets
The accompanying notes are an integral part of the financial statements.
Exhibit H
ORANGE COUNTY, NORTH CAROLINA
STATEMENT OF REVENUES, EXPENSES, AND CHANGES
IN FUND NET ASSETS - PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Internal Service Funds
Major
Nonmajor
TotalDentalOPC
Solid WasteSportsPlexEfland SewerEnterpriseInsuranceRetiree Health
FundFundFundFundsFundFund
Operating Revenues:
Landfill fees$ 8,236,087$-$-$8,236,087$-$ -
Service fees -2,785,702146,2022,931,904- -
Other 110,055--110,055- -
----362,899510,006
Employee contributions
8,346,1422,785,702146,20211,278,046362,899510,006
Total operating revenues
Operating Expenses:
Landfill5,982,636--5,982,636- -
General and administrative1,982,0672,432,792184,8504,599,70938,210 -
Repairs and maintenance --44,70044,700- -
Depreciation 786,278259,01087,1341,132,422- -
Post-closing cost
1,774,503--1,774,503- -
----438,652-
Claims expense
10,525,4842,691,802316,68413,533,970476,862-
Total operating expenses
Operating income (loss)(2,179,342)93,900(170,482)(2,255,924)(113,963)510,006
Non-Operating Revenues (Expenses):
Investment earnings10,001-6610,067140 -
Interest and fees (26,936)(217,318)-(244,254)- -
419,354--419,354--
Grant - State
402,419(217,318)66185,167140-
Total non-operating revenues (expenses)
Income (loss) before contributions
and transfers (1,776,923)(123,418)(170,416)(2,070,757)(113,823)510,006
1,617,852649,27988,5002,355,63110,000-
Transfers in
Change in net assets (159,071)525,861(81,916)284,874(103,823)510,006
Net Assets:
2,855,4471,411,1302,607,1376,873,714278,831-
Beginning of year - July 1
End of year - June 30$2,696,376$1,936,991$2,525,221$7,158,588$175,008$510,006
The accompanying notes are an integral part of the financial statements.
25
Exhibit I
ORANGE COUNTY, NORTH CAROLINA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Internal Service Funds
Major
Nonmajor
TotalDentalOPC
Solid WasteSportsPlexEfland SewerEnterpriseInsuranceRetiree Health
FundFundFundFundsFundFund
Cash Flows from Operating Activities:
Cash received from customers$ 8,557,118$ 2,780,440$ -$ 11,337,558$ -$ 510,006
Cash received from assessments-146,202146,202-
--
Cash received from employee contributions----362,899
-
Cash paid to employees365,7415,574-371,315-
-
Cash paid for goods and services(7,921,536)(2,404,612)(231,238)(10,557,386)(38,210)
-
----(422,804)-
Cash paid for claims
1,001,323381,402(85,036)1,297,689(98,115)510,006
Net cash provided (used) by operating activities
Cash Flows from Non-Capital
Financing Activities:
Transfers in1,617,852649,27988,5002,355,63110,000
-
419,354--419,354--
Non-capital grants
Net cash provided (used) by non-capital
2,037,206649,27988,5002,774,98510,000-
financing activities
Cash Flows from Capital and Related
Financing Activities:
Payments related to the acquisition of capital assets(571,244)(184,190)-(755,434)-
-
Interest paid on long-term debt(57,636)(256,620)-(314,256)-
-
Proceeds on debt issuance3,000,000--3,000,000-
-
(527,698)(376,367)-(904,065)--
Payments related to the payment of debt
Net cash provided (used) by
1,843,422(817,177)-1,026,245--
capital and related financing activities
Cash Flows from Investing Activities:
10,001-6610,067140-
Interest on investments
Net increase (decrease) in cash and cash equivalents4,891,952213,5043,5305,108,986(87,975)510,006
Cash and Cash Equivalents:
12,941,900943,408159,67114,044,979289,754-
Beginning of year - July 1
$ 17,833,852$ 1,156,912$ 163,201$ 19,153,965$ 201,779$ 510,006
End of year - June 30
Reconciliation of Operating Income (Loss) to Net
Cash Provided (Used) by Operating Activities:
Operating income (loss)$ (2,179,342)$ 93,900$ (170,482)$ (2,255,924)$ (113,963)$ 510,006
Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:
Depreciation 786,278259,01087,1341,132,422--
Post-closure cost1,774,503--1,774,503--
Changes in assets and liabilities:
(Increase) decrease in accounts receivable210,976(21,157)-189,819--
(Increase) decrease in prepaid expenses-(1,445)-(1,445)--
Increase (decrease) in accounts payable
and accrued liabilities184,29629,625(1,688)212,23315,848-
Increase (decrease) in compensated absences payable
-5,574-5,574--
Increase (decrease) in unearned revenues-15,895-15,895--
224,612--224,612--
Increase (decrease) in other post-employment benefits
$ 1,001,323$ 381,402$ (85,036)$ 1,297,689$ (98,115)$ 510,006
Net cash provided (used) by operating activities
The accompanying notes are an integral part of the financial statements.
26
Exhibit J
ORANGE COUNTY, NORTH CAROLINA
FIDUCIARY FUNDS
STATEMENT OF FIDUCIARY NET ASSETS
JUNE 30, 2012
Agency
Funds
Assets:
Cash and investments$ 467,730
Accounts receivable, property taxes, net201,497
7,259
Accounts receivable, other
$ 676,486
Total assets
Liabilities:
Accounts payable$ 608,677
67,809
Due to cooperative extension
$ 676,486
Total liabilities
The accompanying notes are an integral part of the financial statements.
27
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
1.Summary of Significant Accounting Policies
Orange County, North Carolina (the "County"), was founded in 1752 and is located in the north-
central portion of North Carolina on the Piedmont Plateau. The County has a commissioner/manager
form of government with a seven-member elected Board of Commissioners comprising the governing
body. The County provides the following services to its citizens: public health, public safety, mental
health, social service programs, planning and zoning, cultural and recreational programs, and housing
and community development service programs. In addition, inspections, environmental resources,
land records, and vital statistics information are provided. Elementary and secondary education is
provided by the State through locally elected educational boards with the assistance of the County.
The accounting policies of Orange County and its component units 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 County, which is governed by a seven-member Board of Commissioners, is one of the 100
counties established in North Carolina under North Carolina General Statute 153A-10. As
required by generally accepted accounting principles, these financial statements present the
County and its component units, legally separate entities for which the County is financially
accountable. The Orange County ABC Board, which has a June 30 year-end, is presented as if it
was a separate Proprietary Fund of the County (discrete presentation). The Orange County ABC
Board is presented in a separate column in the County's financial statements to emphasize that it
is legally separate from the County.
Discretely Presented Component Unit
Orange County ABC Board.
The Orange County Board of Alcoholic Beverage Control ("ABC
Board") operates retail liquor stores within the County and investigates violations of laws
pertaining to retail liquor sales. The five members of the ABC Board's governing board are
appointed by the County. The ABC Board is required by State statute to distribute its surpluses
to the General Fund of the County.
Complete financial statements for the ABC Board may be obtained at its administrative office.
Orange County ABC Board
122 Highway 70 East
Hillsborough, North Carolina 27278
Orange County Industrial Facility and Pollution Control Financing Authority
Orange County Industrial Facility and Pollution Control Financing Authority (the "Authority")
exists to issue and service revenue bond debt of private businesses for economic development
purposes. The Authority is governed by a three-member Board of Commissioners, all of who are
28
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
appointed by the County Commissioners. The County can remove any commissioner of the
Authority with or without cause. The Authority has no financial transactions or account balances;
therefore, it is not presented in the financial statements. The Authority does not issue separate
financial statements.
B.Basis of Presentation
Government-Wide Statements. The Statement of Net Assets and the Statement of Activities
report information on all of the non-fiduciary activities of the primary government. The effect of
interfund activity has been removed from these statements in all material areas. Governmental
activities, which normally are supported by taxes and intergovernmental revenues, are reported
separately from business-type activities, which rely, to a significant extent, on fees and charges
for support.
The Statement of Activities demonstrates the degree to which the direct expenses of a given
function or segments are offset by program revenues. Direct expenses are those that are clearly
identifiable with a specific function or segment. Program revenues include (1) charges to
customers or applicants who purchase, use, or directly benefit from goods, services, or privileges
provided by a given function or segment; and (2) grants and contributions that are restricted to
meeting the operational or capital requirements of a particular function or segment. Taxes and
other items not properly included among program revenues are reported instead as general
revenues.
Fund Financial Statements. The fund financial statements provide information about the
-
governmental, proprietary, and fiduciary - 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.
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. Non-operating revenues, such as
subsidies and investment earnings, result from non-exchange transactions or ancillary activities.
The County reports the following major governmental funds:
General Fund.
TheGeneral Fund is the general operating fund of the County. It is used to
account for all financial resources except those required to be accounted for in another fund. The
Property Revaluation Fund is a legally budgeted fund under North Carolina General Statutes;
however, for statement presentation in accordance with GASB Statement No. 54, it is presented
in the General Fund.
County Capital Improvements Capital Project Fund.
This fund accounts for the financial
resources used in the acquisition, renovation, and improvement of public facilities.
School Capital Improvements Capital Project Fund.
This fund accounts for the financial
resources used in the construction, acquisition, and renovation of public school facilities.
29
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
The County reports the following major enterprise funds:
Solid Waste Fund.
This fund is used to account for the revenues and expenses related to the
provision of solid waste disposal and recycling activities for the citizens of Orange County.
SportsPlex Fund.
This fund accounts for the revenues and expenses related to the provision of
the Triangle SportsPlex.
Additionally, the County reports the following fund types:
Other nonmajor governmental funds: Impact Fee, Community Development, School Capital
Reserve, Section 8 Housing, Grant Supported, Grant Projects, Emergency Telephone System,
Visitors' Bureau, Local Fire Districts, Heusner, Library Development, Adoption Enhancement,
Recreation Subdivision, Article 46 Sales Tax, Piedmont Food & Agricultural Processing Center,
Spay Neuter, and County Capital Reserve.
Efland Sewer Fund.
This fund accounts for the revenues and expenses related to the provision
of sewer service.
Dental Insurance Internal Service Fund.
The Dental Self-Insurance Fund accounts for the
dental plan of the County.
Orange Person Chatham (OPC) Health Insurance Internal Service Fund.
The OPC Health
Insurance Fund is used to account for the health insurance contributions and premiums of the
OPC employees that have joined the County's health insurance plan.
Agency Funds.
Agency funds are custodial in nature and do not involve measurement of results
of operations. Agency funds are used to account for assets the County holds on behalf of others.
The County maintains the following agency funds: School District Fund, which accounts for the
collection and disbursement of taxes for the Chapel Hill-Carrboro City School District for which
the County acts as an agent; the Cooperative Extension 4-H Fund, which accounts for the receipts
and disbursement of funds on behalf of the 4-H program advisory board; Hyconeechee Regional
Library Fund, which accounts for the receipt and disbursement of funds on behalf of the
Hyconeechee Library System for which the County acts as an agent; American Stone No Fault
Well Repair Fund, which accounts for funds made available from American Stone and the
Orange Water and Sewer Authority for residents within 3,000 feet of the perimeter of the
American Stone Quarry to repair or replace residential wells that fail for any reason other than as
the probable result of American Stone quarry operation; Communication Tower Trust Fund,
which is used to account for application fees paid to the County by telecommunication
companies, with these fees being used to pay costs associated with determining tower locationand
construction with unused fees being returned to the telecommunication companies; Jail Inmate
Trust Fund, which accounts for the receipts from jail inmates who are incarcerated in the County
jail; the Motor Vehicle Tax Fund, which accounts for registered motor vehicle property taxes that
are billed and collected by the County for various municipalities and special districts within the
County, the DSS Trust Fund that accounts for funds held by the County for subsistence needs of
30
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
specific social service clients; and the Register of Deeds Trust Fee Fund that accounts for the
$6.20 of each fee collected by the Register of Deeds for registering or filing a deed of trust
mortgage that the County is required to submit to the State Treasurer on a monthly basis.
Measurement Focus and Basis of Accounting
In accordance with North Carolina General Statutes, all funds of the County are maintained
during the year using the modified accrual basis of accounting.
Government-Wide, Proprietary, and Fiduciary Fund Financial Statements.
The
government-wide, proprietary, and fiduciary fund financial statements are reported using the
economic resources measurement focus, except for the agency funds which have no measurement
focus. The government-wide, proprietary, and fiduciary fund financial statements are reported
using 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 County gives (or receives) value without directly
receiving or (giving) equal value in exchange, include property taxes, grants, entitlements, and
donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for
which the taxes are levied. Revenue from grants, entitlements, and donations is recognized in the
fiscal year in which all eligibility requirements have been satisfied.
As a general rule, the effect of interfund activity has been eliminated from the government-wide
financial statements. Exceptions to this general rule are payments in-lieu-of taxes, where the
amounts are reasonably equivalent in value to the interfund services provided and other charges
between the County's enterprise funds and various other functions of the County. Elimination of
these charges would distort the direct costs and program revenues reported for the various
functions concerned.
Amounts reported as program revenues include 1) charges to customers or applicants for goods,
services, or privileges provided; 2) operating grants and contributions; and 3) capital grants and
contributions, including special assessments. Internally dedicated resources are reported as
general revenues rather than as program revenues. Likewise, general revenues include all taxes.
Proprietary funds distinguish operating revenues and expenses from non-operating items.
Operating revenues and expenses generally result from providing services and producing and
perations. The
principal operating revenues of the County enterprise funds are charges to customers for sales and
services. The County also recognizes, as operating revenue, the portion of tap fees intended to
recover the cost of connecting new customers to the system. Operating expenses for enterprise
funds include the cost of sales and services, administrative expenses, and depreciation on capital
assets. All revenues and expenses not meeting this definition are reported as non-operating
revenues and expenses.
31
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
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. Expenditures are recorded
when the related fund liability is incurred, except for principal and interest on long-term debt,
claims and judgments, and compensated absences, which are recognized as expenditures to the
extent they have matured. Long-term debt issued and acquisitions under capital leases are
reported as other financing sources. General capital asset acquisitions are reported as
expenditures in governmental funds. Proceeds of general long-term debt and acquisitions under
capital leases are reported as other financing sources.
The County considers all revenues available if they are collected within 90 days after year-end,
except for property taxes. Ad valorem property taxes are not accrued as revenue because the
amount is not susceptible to accrual. At June 30, taxes receivable are materially past due and are
not considered to be an available resource to finance the operations of the current year. Also, as
of January 1, 1993, State law altered the procedures for the assessment and collection of property
taxes on registered motor vehicles in North Carolina. Effective with this change in the law, the
County is responsible for billing and collecting the property taxes on all registered motor vehicles
on behalf of all municipalities and special tax districts in the County. For registered motor
vehicles, property taxes are due the first day of the fourth month after the vehicles are registered.
The billed taxes are applicable to the fiscal year in which they become due. Therefore, taxes for
vehicles registered from March 2011 through February 2012 apply to the fiscal year ended June
30, 2012. Uncollected taxes which were billed during this period are shown as a receivable on
these financial statements.
Sales taxes and certain intergovernmental revenues, such as the utilities franchise tax collected
and held by the State at year-end on behalf of the County, are recognized as revenue.
Intergovernmental revenues and sales and services are not susceptible to accrual because
generally they are not measurable until received in cash. Expenditure-driven grants are
recognized as revenue when the qualifying expenditures have been incurred and all other grant
requirements have been satisfied.
Under the terms of grant agreements, the County funds certain programs by a combination of
specific cost-reimbursement grants, categorical block grants, and general revenues. Thus, when
program expenses are incurred, there are both restricted and unrestricted net assets available to
-reimbursement grant resources
to such programs, followed by categorical block grants, then by general revenues.
All governmental and business-type activities and enterprise funds of the County follow FASB
Statements and Interpretations issued on or before November 30, 1989, Accounting Principles
Board Opinions, and Accounting Research Bulletins, unless those pronouncements conflict with
GASB pronouncements.
32
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
C.Budgetary Data
utes. An annual
budget is adopted for the General Fund, the special revenue funds (except for where project
ordinances are adopted), and the enterprise funds. All annual appropriations lapse at fiscal year-
end. Project ordinances are adopted for the Community Development Special Revenue Fund, the
Grant Projects Special Revenue Fund, the Adoption Enhancement Special Revenue Fund, and the
capital projects funds.
All budgets are prepared using the modified accrual basis of accounting. Expenditures may not
legally exceed appropriations at the functional level for all annually budgeted funds and at the
object level for the multi-year funds. The County Manager is authorized to transfer budget
amounts within the functional categories in any fund; however, any revisions that alter total
expenditures of any functional category or fund must be approved by the Board of County
Commissioners. 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.
The following summarizes the supplementary appropriations made during 2012:
33
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Unencumbered annual appropriations lapse at each fiscal year-end and must be reappropriated in
Open encumbrances are reported as restricted fund balance at June 30, 2012.
D. Assets, Liabilities, and Fund Equity
Deposits and Investments
All deposits of the County are made in Board-designated official depositories and are secured as
required by G.S. 159-31. The County may designate, as an official depository, any bank or
savings association whose principal office is located in North Carolina. Also, the County may
establish time deposit accounts such as NOW and SuperNOW accounts, money market accounts,
and certificates of deposit.
State law [G.S. 159-30(c)] authorizes the County 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; and the North Carolina Capital Management Trust
(NCCMT).
investments are carried at fair value as determined by quoted market prices. The
securities of the NCCMT Cash Portfolio, an SEC-registered (2a-7) money market mutual fund,
securities are valued at fair value.
Cash and Cash Equivalents
The County 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.
Restricted Assets
Unexpended bond and installment purchase proceeds are considered restricted assets because
their use is completely restricted to the purpose for which the bonds and installment purchase
proceeds were originally issued. Total unspent bond and installment purchase proceeds are
$35,931,837 at June 30, 2012. This restricted cash in shown in the General Fund, County Capital
Fund, School Capital Fund, and the Solid Waste Fund. The remaining restricted assets in the
General Fund represent Property Tax Revaluation Fund money of $162,188, which is restricted
per North Carolina General Statute 153A-150.
34
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Ad Valorem Taxes Receivable
In accordance with State law [G.S. 105-347 and G.S. 159-13(a)], the County levies ad valorem
taxes on property other than motor vehicles on July 1, the beginning of the fiscal year. The taxes
are due on September 1 (lien date); however, penalties and interest do not accrue until the
following January 6.
These taxes are based on the assessed values as of January 1, 2010. On June 30, the end of the
fiscal year, property taxes receivable are materially past due and, consequently, cannot be
considered a resource with which to pay liabilities of the current period, although the amount due
is measurable. Therefore, property taxes receivable are recorded net of an allowance for
estimated uncollectible delinquent taxes, with the amount of the net receivable recorded as
deferred revenue until collected. These amounts are recorded as revenue in the government-wide
statements.
A revaluation of all real property is required to be performed no less than every eight years. The
County performs a revaluation every four years. The last revaluation affecting these financial
statements was completed on January 1, 2005.
Property taxes, other than taxes for special districts, are levied under the "single tax levy"
concept; whereby,all tax revenues are recorded as revenues of the General Fund.
As permitted by the North Carolina General Statutes, the County has adopted a policy of treating
all collections of property taxes which are delinquent in excess of two years as revenues of the
General Fund, regardless of the fund for which the property tax was originally levied.
Allowances for Doubtful Accounts
All receivables that historically experience uncollectible accounts are shown net of an allowance
for doubtful accounts. This amount is estimated by analyzing the percentage of receivables that
were written off in prior years.
Concentrations of Credit Risk
The County is engaged primarily in governmental activities. The County performs ongoing credit
evaluations of its customers' financial condition and, generally, requires no collateral from its
customers.
Inventories and Prepaid Items
Inventories of the County are valued at cost (first-in, first-out). The County's General Fund
inventory consists of expendable supplies that are recorded as expenditures when purchased.
Certain payments to vendors reflect costs applicable to future accounting periods and are
recorded as prepaid items in both government-wide and fund financial statements.
35
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Capital Assets
Capital assets are reported in the applicable governmental or business-type activities columns in
the government-wide financial statements. The County defines capital assets as assets with an
individual cost of $5,000 or more. Purchased or constructed capital assets are recorded at original
cost at the time of acquisition. Donated capital assets are recorded at their estimated fair value at
the time received. Public domain (infrastructure) capital assets have been included in the capital
asset balances reported. The cost of normal maintenance and repairs that do not add value to the
asset or materiall
The County holds title to certain Orange County Board of Education and Chapel Hill-Carrboro
City Board of Education properties that have not been included in capital assets. The properties
have been deeded to the County to permit installment purchase financing of acquisition and
construction costs and to permit the County to receive refunds of sales tax paid for construction
costs. Agreements between the County and the Board of Education give the Board of Education
full use of the facilities, full responsibility for maintenance of the facilities, and provide that the
County will convey title to the property back to the Board of Education once all restrictions of the
financing agreements and all sales tax reimbursement requirements have been met. The
properties are reflected as capital assets in the financial statements of the Orange County Board of
Education and Chapel Hill-Carrboro City Board of Education.
Capital assets are depreciated on a straight-line basis over the following estimated useful lives to
the cost of the assets:
Long-Term Obligations
In the government-wide financial statements and in the proprietary fund types in the fund
financial statements, long-term debt and other long-term obligations are reported as liabilities in
the applicable governmental activities, business-type activities, or proprietary fund Statement of
Net Assets.
In the fund financial statements for governmental fund types, the face amount of the debt issued
is reported as an other financing source.
36
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Compensated Absences
Permanent employees of the County can earn vacation leave at the rate of 12 days per year for the
first two years up to a maximum of 24 days per year after 20 years. Vacation leave may be
accumulated with a maximum until January 31 of each year. On that date, any accumulated
vacation leave in excess of 240 hours is converted to sick leave. The maximum amount of
vacation leave that can be carried forward to February 1 is 240 hours. At termination, employees
are paid for any accumulated vacation leave. These amounts are paid from the same fund to
which the employee's salary is charged. Accumulated vacation leave and salary related payments
at June 30, 2012 amounted to $5,097,695 for governmental activities and $363,108 for business-
type activities.
Permanent employees of the County earn sick leave at a rate of 12 days per year. There is no
limit on the accumulation of sick leave for the County. Accumulated sick leave for the County at
June 30, 2012 amounted to $12,557,017 in total, $11,720,856 of which relates to the
governmental funds and $836,161 which relates to the enterprise funds. 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 County has no obligation for
accumulated sick leave until it is actually taken, no accruals for sick leave have been made.
Net Assets/Fund Balances
Net Assets
Net assets in the government-wide and proprietary fund financial statements are classified as
invested in capital assets, net of related debt; restricted; and unrestricted. Restricted net assets
represent constraints on resources that are either externally imposed by creditors, grantors,
contributors, laws or regulations of other governments, or imposed by law through State statute.
As with many counties in the State of North Carolina, the County's deficit in unrestricted net
assets is due primarily to the portion of the County's outstanding general obligation and
installment debt totaling approximately $149.2 million incurred for the Orange County and the
Chapel Hill-Carrboro City Boards of Education (the "school . Under North Carolina
law, the County is responsible for providing school system capital funding and has done so using
a mixture of County funds and general obligation debt. The deficit results because the debt is
recorded on the County's financial statements as the issuing government, while the related assets
are owned, operated, and recorded in the school system's financial statements.
Fund Balances
In the governmental fund financial statements, fund balance is composed of five classifications
designed to disclose the hierarchy of constraints placed on how fund balance can be spent.
37
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
State law [G.S. 159-13(b)(16)] restricts appropriation of fund balance for the subsequent year's
budget to an amount not to exceed the sum of cash and investments minus the sum of liabilities,
encumbrances, and deferred revenues arising from cash receipts as those amounts stand at the
close of the fiscal year preceding the budget year.
The governmental fund types classify fund balances as follows:
Non-Spendable Fund Balance
This classification includes amounts that cannot be spent because they are either (a) not in
spendable form or (b) legally or contractually required to be maintained intact.
Inventories portion of fund balance that is not an available resource because it represents the
year-end balance of ending inventories, which are not spendable resources.
Prepaid Items portion of fund balance that is not an available resource because it represents
prepaid amounts, which are not spendable resources.
Restricted Fund Balance
This classification includes amounts that are restricted to specific purposes externally imposed by
creditors or imposed by law.
Stabilization by State Statute portion of fund balance that is not an available resource for
appropriation in accordance with State law [G.S. 159-8(a)].
Restricted for Education portion of fund balance restricted by revenue source to be used to
support public education.
Restricted for Governing and Management portion of fund balance that is restricted by revenue
source for general government administration.
Restricted for Public Safety portion of fund balance restricted by revenue source for public
safety related activities, such as law enforcement, fire protection, EMS, and E-911
communications.
Restricted for Community and Environment portion of fund balance restricted by revenue
source for use for planning, economic development, and other related activities.
38
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Restricted fund balance at June 30, 2012 is as follows:
Committed Fund Balance
This classification represents the portion of fund balance that can only be used for specific
purposes determined by a formal action of the government's highest level of decision-making
authority. The Board of Commissioners is the highest level of decision-making authority for the
government that can, by adoption of an ordinance prior to the end of the fiscal year, commit fund
balance. Once adopted, the limitation imposed by the ordinance remains in place until a similar
action is taken (the adoption of another ordinance) to remove or revise the limitation.
Committed for Human Services portion of fund balance budgeted by the Board for social
services, mental healthcare, and public health programs.
Committed for Education represents the portion of fund balance committed by the governing
body for future capital related purposes.
Committed for Governing and Management represents the portion of fund balance committed
by the governing body for general government administration.
Committed for General Services represents the portion of fund balance committed by the
governing body for general services related activities.
39
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Committed fund balance at June 30, 2012 is as follows:
Assigned Fund Balance
Assigned fund balance is the portion of fund balance that Orange County intends to use for
specific purposes. The County's governing body has the authority to assign fund balance. The
Manager, as granted in the officially adopted budget ordinance, has been granted limited
authority to assign fund balance.
Subsequent Year's Expenditures portion of fund balance that is appropriated in the next year's
budget that is not already classified in restricted or committed. The governing body approves the
appropriation; however, the budget ordinance authorizes the Manager and Finance Officer to
make certain modifications without requiring Board approval.
Assigned for Community and Environment portion of fund balance budgeted by the Board for
planning, economic development, and other related activities.
Assigned for General Services portion of fund balance that has been budgeted by the Board for
general services related activities.
Assigned for Education portion of fund balance budgeted by the Board to be used to support
public education.
40
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Assigned fund balance at June 30, 2012 is as follows:
Unassigned Fund Balance
Unassigned fund balance represents the portion of fund balance that has not been assigned to
another fund or is not restricted, committed, or assigned to specific purposes within the general
fund.
Orange County has a revenue spending policy that provides guidance for programs with multiple
revenue sources. The Finance Officer will use resources in the following order: bond/debt
proceeds, federal funds, State funds, local non-County funds, and County funds. For purposes of
fund balance classification, expenditures are to be spent from restricted fund balance first,
followed in-order by committed fund balance, 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 County with approval of the Manager and the Board of County Commissioners.
Orange County has also adopted a minimum fund balance policy for the General Fund which
instructs management to conduct the business of the County in such a manner that available fund
balance is at least equal or greater than 17% of budgeted expenditures. Any portion of the
General Fund balance in excess of 17% of budgeted expenditures may be appropriated for one-
time expenditures and may not be used for any purpose that would obligate the County in a future
budget.
The following schedule provides management and citizens with information on the portion of
General Fund balance that is available for appropriation.
41
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
The outstanding encumbrances are amounts needed to pay any commitments related to purchase
orders and contracts that remain unperformed at year-end.At year-end, the General Fund had
outstanding encumbrances of $786,847.
Reconciliation of the Statement of Revenues, Expenditures, and Changes In Fund Balance -
Budget and Actual - General Fund to the Statement of Revenues, Expenditures, and
Changes in Fund Balance - Governmental Funds
A legally budgeted Property Revaluation Fund isconsolidated into the General Fund for reporting
purposes on the Statement of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds (Exhibit D). Fund balance for the General Fund is reconciled as follows:
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally
accepted in the United States of America requires management to make estimates and
assumptions that affect certain reported amounts and disclosures. Accordingly, actual results
could differ from those estimates.
2. Detail Notes OnAll Funds
Assets
Deposits
All deposits of the County 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 County's agents in names. 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 County, these deposits are considered to be held by their agents in the
42
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
entities names. 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 County or with the escrow agent. Because of the inability to measure the exact amount of
collateral pledged for the County under the Pooling Method, the potential exists for
undercollaterization, 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 State Treasurer enforces standards of minimum capitalization for all pooling method financial
institutions. The County relies on the State Treasurer to monitor those financial institutions. The
County analyzes the financial soundness of any other financial institution used by the County. The
County complies with the provisions of G.S. 159-31 when designating official depositories and
verifying that deposits are properly secured.The County does not have a policy regarding custodial
credit risk for deposits.
At June 30, 2012, the County's deposits had a carrying amount of $28,644,696 and a bank balance of
$29,300,268. Of the bank balance, $900,434 was covered by federal depository insurance, and
$28,399,834 was covered bycollateral held under the Pooling Method. Cash on hand was $4,825.
Investments
At June 30, 2012, the County had the following investments and maturities:
Less Than 6-12
Investment Type Fair Value 6 Months Months 1-3 Years
NC Capital Management Trust -
Cash Portfolio
$ 55,484,702N/AN/AN/A
Commercial Paper:
Abbey National LLC 2,995,950 2,995,950N/AN/A
Barclays US Funding 1,997,639 1,997,639N/AN/A
Dealers Cap Access Tr Inc 1,249,728 1,249,728N/AN/A
Dealers Cap Access Tr Inc 3,746,208 3,746,208N/AN/A
Deutsche Bank 1,998,060 1,998,060N/AN/A
Deutsche Bank 1,993,200 1,993,200N/AN/A
FCAR Owner Trust II 1,993,968 1,993,968N/AN/A
FCAR Owner Trust II 1,997,278 1,997,278N/AN/A
FCAR Owner Trust II 1,994,914 1,994,914N/AN/A
FCAR Owner Trust II 1,998,276 1,998,276N/AN/A
$ 77,449,924$ 21,965,222
Total investments
43
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
In addition to the previously noted limitations on appropriate securities, Orange County's investment
activities are further restricted in the following manner:
A.
It is the policy of Orange County to diversify its investment portfolio. Assets held shall be
diversified to eliminate the risk of loss resulting from the over concentration of assets in a specific
maturity, a specific issuer or a specific class of securities. Diversification shall be determined and
revised periodically by the Investment Officer. Portfolio maturities shall be staggered to avoid
undue concentration of assets in a specific maturity sector. Maturities selected shall provide for
stability of income and reasonable liquidity.
B.
Orange County recognizes that investment risks can result from issuer defaults, market price
changes or various technical complications leading to temporary illiquidity. Portfolio
diversification is employed as a way to minimize default risk. No individual investment
transaction shall be undertaken that jeopardizes the capital position of the overall portfolio. In the
event of a default by a specific issuer, the Financial Services Director shall review and, if
appropriate, proceed to liquidate securities having comparable credit risks.
C.
No investments in Repurchase Agreements shall be made unless the underlying collateral shall be
placed in safekeeping in the trust department of a third-party designated by the County.
D.
The combined total investment in commercial paper and bankers' acceptances shall not exceed
thirty five percent (35%) of the total portfolio and the investment in commercial paper or bankers'
acceptances of a single issuer shall not exceed (35%) of the total portfolio at the time of
investment.
E.
No investment shall be made in any security with a maturity greater than five (5) years from the
date of purchase.
carried at fair value as determined by quoted market prices. The
securities of the NCCMT Cash Portfolio, an SEC-registered (2a-7) money market mutual fund, are
are
valued at fair value.
Credit Risk.State law limits investments in commercial paper to the top rating issued by nationally
recognized statistical rating organizations (NRSROs); however, the County has no formal policy on
specifically managing credit risk. Investments in the North Carolina Capital Man
Cash Portfolio carried a credit rating of AAAm by Standard as of June 30, 2012.
Investments in the Abbey National LLC, Barclays US Funding, Dealers Cap Access Tr Inc, Deutche
Bank, and FCAR Owner Trust II all carried credit ratings of P-1 and A-1 by Moody's and Standard &
Poor's, respectively.
Concentration of Credit Risk.The County places no limit on the amount that the County may invest
in any one issuer. More than 40 percent of the County's investments are in commercial paper.
Investments in Commercial paper are allocated as follows: Abbey National LLC 14%, Barclays US
Funding 9%, Dealers CP Acces Tr Inc 23%, Deutche Bank 18%, and FCAR Owner Trust II 36%.
44
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Property Tax Use-Value Assessment on Certain Lands
In accordance with the General Statutes, agriculture, horticulture, and forestland may be taxed by the
County at the present use-value as opposed to market value. When the property loses its eligibility
for use-value taxation, the property tax is recomputed at market value for the current year and the
three preceding fiscal years, along with the accrued interest from the original due date. This tax is
immediately due and payable. The following are property taxes that could become due if present use-
value eligibility is lost. These amounts have not been recorded in the financial statements.
Receivables
The amounts presented in the Balance Sheet and the Statement of Net Assets for the year ended June
30, 2012 is net of the following allowance for doubtful accounts:
45
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
3.Capital Assets
Governmental Capital Assets
assets are as follows:
46
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Depreciation expense was charged to functions/programs of the primary government as follows:
Proprietary Capital Assets
The capital assets of the proprietary funds at June 30, 2012 are as follows:
47
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
48
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
4. Construction Commitments
The government has active construction projects as of June 30, 2012. At June 30, 2012, the
5.Pension Plan Obligations
Local Governmental Employees' Retirement System
Plan Description.
The County contributes to the State-wide Local Governmental Employees
Retirement System ("LGERS"), a cost-sharing, multiple-employer defined benefit pension plan
administered by the State of North Carolina. LGERS provides retirement and disability benefits to
plan members and beneficiaries. Article 3 of G.S. Chapter 128 assigns the authority to establish and
amend benefit provisions to the North Carolina General Assembly. The LGERS 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 LGERS. That report
may be obtained by writing to the Office of the State Controller, 1410 Mail Service Center, North
Carolina 27699-1410, or by calling (919) 981-5454.
Funding Policy.
Plan members are required to contribute six percent of their annual covered salary.
The County is required to contribute at an actuarially determined rate. For the County, the current
rate for employees not engaged in law enforcement and for law enforcement officers is 4.89% and
4.78%, respectively, of annual covered payroll. The contribution requirements of members and of the
County are established and may be amended by the North Carolina General Assembly. The County's
contributions to LGERS for the years ended June 30, 2012, 2011, and 2010 were $2,773,835,
$2,505,559, and $1,943,795, respectively. The contributions made by the County equaled the
required contributions for each year.
49
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Plan Description.
The County administers a public employee retirement system (the "Separation
Allowance"), a single-employer defined benefit pension plan that provides retirement benefits to the
County's qualified sworn law enforcement officers.The Separation Allowance is equal to 0.85% of
the annual equivalent of the base rate of compensation most recently applicable to the officer for each
year of creditable service. The retirement benefits are not subject to any increases in salary or
retirement allowances that may be authorized by the General Assembly. Article 12D of G.S, Chapter
143 assigns the authority to establish and amend benefit provisions to the North Carolina General
Assembly.
The Separation Allowance covers all full-time law enforcement officers of the County. At December
31, 2011, the Separation Allowance's membership consisted of:
A separate report was not issued for the plan.
Summary of Significant Accounting Policies
Basis of Accounting. The County has chosen to fund the Separation Allowance on a pay-as-you-go
basis. Pension expenditures are made from the General Fund, which is maintained on the modified
accrual basis of accounting.
Method Used to Value Investments. No funds are set aside to pay benefits and administration costs.
These expenditures are paid as they come due.
Contributions.
The County is required by Article 12D of G. S. Chapter 143 to provide these
retirement benefits and has chosen to fund the benefit payments on a pay-as-you-go basis through
appropriations made in the General Fund operating budget. The County's obligation to contribute to
this plan is established and may be amended by the North Carolina General Assembly. There were
no contributions made by employees.
Actuarial Assumptions.
The amortization method for the Separation Allowance is alevel percent of
pay closed. The remaining amortization period is 20 years. The annual required contribution for the
current year was determined as part of the December 31, 2010 actuarial valuation using the projected
unit credit actuarial cost method. The actuarial assumptions included (a) 5.00% investment rate of
return (net of administrative expenses) and (b) projected salary, increase ranging from 4.25% to
7.85% per year. Both (a) and (b) included an inflation component of 3.00%. The assumptions did
not include post-retirement benefit increases.
50
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Annual Pension Cost and Net Pension Obligation
The County's annual pension cost and net pension obligation to the Separation Allowance for the
current year were as follows:
Funded Status and Funding Progress.
As of December 31, 2011, the most recent actuarial
valuation date, the plan was not funded. The actuarial accrued liability for benefits and the unfunded
actuarial accrued liability (UAAL) was $2,004,133. The covered payroll (annual payroll of active
employees covered by the plan) was $4,164,888, and the ratio of the UAAL to the covered payroll
was 48.12%.
The Schedule of Funding Progress, presented as required supplementary information following the
notes to the financial statements, presents multi-year trend information about whether the actuarial
value of plan assets are increasing or decreasing, over time, relative to the actuarial accrued liability
for benefits.
51
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Supplemental Retirement Income Plan for Law Enforcement Officers
Plan Description.
The County contributes to the Supplemental Retirement Income Plan (Plan),
a defined contribution pension plan administered by the Department of State Treasurer and a Board of
Trustees. The Plan provides retirement benefits to law enforcement officers employed by the County.
Article 5 of G.S. Chapter 135 assigns the authority to establish and amend benefit provisions to the
North Carolina General Assembly.The Supplemental Retirement Income Plan for Law Enforcement
Officers is included in the Comprehensive Annual Financial Report (CAFR) for the State of North
atements for the Internal
Revenue Code Section 401(k) plan that includes the Supplemental Retirement Income Plan for Law
Enforcement Officers. That report may be obtained by writing to the Office of the State Controller,
1410 Mail Service Center, Raleigh, North Carolina 27699-1410, or by calling (919) 981-5454.
Funding Policy.
Article 12E of G.S. Chapter 143 requires that the County contribute each month an
immediately. Also, the law enforcement officers may make voluntary contributions to the Plan.
Contributions for the year ended June 30, 2012 were $241,985, which consisted of $200,489 from the
County and $41,496 from the law enforcement officers.
Plan Description.
The
Fund (Fund), a non-contributory, defined contribution plan administered by the North Carolina
Department of State Treasurer. The Fund provides supplemental pension benefits to any county
register of deeds that
(LGERS), or an equivalent locally sponsored plan. Article 3 of G.S. Chapter 161 assigns the
authority to establish and amend benefit provisions to the North Carolina General Assembly.The
Report (CAFR) for the State
required supplementary information for the Fund. That report may be obtained by writing to the
Office of the State Controller, 1410 Mail Service Center, Raleigh, North Carolina 27699-1410, or by
calling (919) 981-5454.
Funding Policy.
On a monthly basis, the County remits to the Department of State Treasurer an
amount equal to one and one-half percent (1.5%) of the monthly receipts collected pursuant to Article
3 of G.S. 161. Immediately following January 1 of each year, the Department of State Treasurer
divides ninety-three percent (93%) of the amount in the Fund at the end of the preceding calendar
year into equal shares to be disbursed as monthly benefits. The remaining seven percent (7%) of the
State Treasurer in administering the Fund. For the fiscal year ended
June 30, 2012tual contributions were $18,613.
52
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Other Post-Employment Benefits Healthcare Benefits
Plan Description.
Under the terms of a County Personnel Ordinance, the County administers a
single-employer defined benefit Retiree Healthcare Benefits Plan (the "RHCB Plan"). As of July 1,
2007, this plan provides post-employment healthcare benefits to retirees of the County, provided they
participate in the North Carolina Local Governmental Employees' Retirement System (System) and
have at least ten years of creditable employment with the County, are age 65 with five years of
creditable service with the County, or retiring on a disability retirement with five years of creditable
service with the County. The County provides coverage through its employee health insurance plan
up to age 65. At age 65, the County provides coverage through a Medicare supplement plan. Retirees
can purchase coverage for their dependents who are under age 65 at the County's group rates. The
County Commissioners may change the Plan by amending the Personnel Ordinance. A separate
report was not issued for the Plan.
Membership of the Plan consisted of the following at December 31, 2011, the date of the latest
actuarial valuation:
Funding Policy.
The County pays for the full cost of coverage under its employee healthcare plan
for members with ten years of service and 52% of the cost of coverage for dependents up to age 65.
The County pays 50% of the cost of coverage for eligible members with at least five years of service
and 26% of the costs of coverage for their dependents.At age 65, the County provides a Medicare
supplement plan for members with at least ten years of service at no cost. Members with at least five
years of service pay 50% of the cost of coverage. The County does not cover dependents over 65
years of age. The County does not subsidize dependent coverage for eligible retirees hired after July
1, 2008. The County has chosen to fund the healthcare benefits on a pay-as-you-go basis.
The current annual required contribution ("ARC") rate is 14.45%of annual covered payroll. For the
current year, the County contributed $1,727,365, or 4.48% of annual covered payroll. The County
provides coverage through a self-funded risk financing pool administered by the North Carolina
Association of County Commissioners.
Summary of Significant Accounting Policies.
Post-employment expenditures are made from the
General Fund and the Solid Waste Fund. The General Fund is maintained on the modified accrual
basis of accounting while the Solid Waste Fund is an Enterprise Fund, which is maintained on the full
accrual basis of accounting. No funds are set aside to pay benefits and administration costs. These
expenditures are paid as they come due.
53
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Annual OPEB Cost and Net OPEB Obligation.
ost (expense) is
calculated based on the annual required contribution of the employer (ARC), an amount actuarially
determined in accordance with the parameters of GASB Statement 45. The ARC represents a level of
funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize
any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years.
amount
healthcare benefits:
net OPEB obligation for 2012 were as follows:
Funding Status and Funding Progress.
As of December 31, 2011, the most recent actuarial
valuation date, the plan was not funded. The actuarial accrued liability for benefits and, thus, the
unfunded actuarial accrued liability ("UAAL") was $63,716,142. The covered payroll (annual payroll
of active employees covered by the plan) was $38,572,921, and the ratio of the UAAL to the covered
payroll was 165.2 percent.
54
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and
assumptions about the probability of occurrence of events far into the future. Examples include
assumptions about future employment, mortality, and healthcare trends. Amounts determined
regarding the funded status of the plan and the annual required contributions of the employer are
subject to continual revision as actual results are compared with past expectations and new estimates
are made about the future. The Schedule of Funding Progress, presented as required supplementary
information following the notes to the financial statements, presents multi-year trend information
about whether the actuarial value of plan assets is increasing or decreasing over time relative to the
actuarial accrued liabilities for benefits.
Actuarial Methods and Assumptions.
Projections of benefits for financial reporting purposes are
based on the substantive plan (the plan as understood by the employer and the plan members) and
include the types of benefits provided at the time of each valuation and the historical pattern of
sharing of benefit costs between the employer and plan members at that point. The actuarial methods
and assumptions used include techniques that are designed to reduce the effects of short-term
volatility in actuarial accrued liabilities and the actuarial value assets, consistent with the long-term
perspective of the calculations.
In the December 31, 2011 actuarial valuation, the projected unit credit actuarial cost method was used
for the County's Plan. The actuarial assumptions included a 4.00 percent investment rate of return
(net of administrative expenses), which is the expected long-term investment returns on the
employer's own investments calculated based on the funded level of the plan at the valuation date,
and an annual pre-Medicare trend rate of 9.50 to 5.00 percent annually, and a post-Medicare trend
rate of 7.00 to 5.00 percent annually. Both rates included a 3.00 percent inflation assumption. The
actuarial value of assets, if any, was determined using techniques that spread the effects of short-term
volatility in the market value of investments over a five-year period. The UAAL is being amortized
as a level percentage of projected payroll on an open basis. The remaining amortization period at
December 31, 2011 was 30 years.
As of June 30, 2012, management has decided that OPEB will continue to be funded on a pay-as-you-
go basis. Management will continue their efforts to find a way to fund the annual required
contribution while maintaining the level of service as prioritized by the County Commissioners.
Other Employment Benefits
The County has elected to provide death benefits to employees through the Death Benefit Plan for
members of the Local Governmental Employees' Retirement System (Death Benefit Plan), a multiple-
employer, State-administered, cost-sharing plan funded on a one-year term cost basis. The
beneficiaries of those employees who die in active service after one year of contributing membership
in the System, or who die within 180 days after retirement or termination of service and have at least
one year of contributing membership service in the System at the time of death, are eligible for death
benefits. Lump-sum death benefit payments to beneficiaries are equal to the employee's 12 highest
months salary in a row during the twenty-four months prior to the employee's death, but the benefit
must be between $25,000 and $50,000. All death benefit payments are made from the Death Benefit
Plan. The County has no liability beyond the payment of monthly contributions. Contributions are
55
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
determined as a percentage of monthly payroll, based upon rates established annually by the State.
Separate rates are set for employees not engaged in law enforcement and for law enforcement
officers. Because the benefit payments are made by the Death Benefit Plan and not by the County,
the County does not determine the number of eligible participants. For the fiscal year ended June 30,
2012, the County made contributions to the State for death benefits of $32,912. The County's
required contributions for employees not engaged in law enforcement and for law enforcement
officers represented 0.08% and 0.14% of covered payroll, respectively. The contributions to the
Death Benefit Plan cannot be separated between the post-employment benefit amount and the other
benefit amount.
Other Post-Employment Benefits for County Employees That Participated in the Teachers' and
State Employees' Retirement System
In addition to providing pension benefits, the County provides health benefits, death benefits, and
disability benefits to certain employees in accordance with State statutes. These benefits are provided
through multiple-employer, cost-sharing plans administered by the State. Health benefits are provided
to retirees of the Teachers' and State Employees' Retirement System ("System") who have at least
five years of creditable service under the System. The State pays the full cost of coverage for all
retirees enrolled in the State's self-funded Teachers' and State Employees' Comprehensive Major
Medical Plan and makes similar contributions for retirees enrolled in one of four State health
maintenance organization ("HMO") plans. In addition, persons who became surviving spouses of
retirees prior to October 1, 1986 receive the same coverage as retirees. Retirees and the
aforementioned surviving spouses pay for the additional cost of HMO coverage and for the entire cost
of coverage of their dependents. The number of the County's participants who are eligible for health
benefits cannot be determined. The health benefit plans are funded by the State on a pay-as-you-go
basis.
Other Employment Benefits for County Employees That Participated in the Teachers' and
State Employees' Retirement System
Death benefits are provided through the Death Benefit Plan for Members of the Teachers' and State
Employees' Retirement System ("Death Benefit Plan"), a State-administered plan funded on a one-
year term cost basis. Lump-sum death benefits are provided to employees (1) who die in active
service after one year of contributing membership service in the System, or (2) who die within 180
days after retirement or termination of service and have at least one year of contributing membership
service in the System at the time of death. This payment is equal to the employee's highest 12
consecutive months' salary during the 24 months prior to his/her death, but must be at least $25,000
and no more than $50,000.
Short-term and long-term disability benefits are provided through the Disability Income Plan of North
Carolina ("Disability Income Plan"), a State-administered plan, which also is funded on a one-year
term cost basis.
56
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Long-term disability benefits are payable from the Disability Income Plan 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 provided
the following requirements are met: (1) the employee has five years of contributing membership
service in the System earned within 96 months prior to the end of the short-term disability period; (2)
the employee must have made an application to receive long-term benefits within 180 days after the
conclusion of the short-term disability period or after salary continuation payments cease, 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; and (5) the employee must not
be eligible to receive an unreduced retirement benefit from the System. In addition, recipients of
long-term disability benefits are eligible to receive State-paid health insurance coverage. The number
of the County's participants who are receiving long-term disability benefits cannot be determined.
The monthly long-term disability benefit is equal to 65 percent of one-twelfth of an employee's
annual base rate of compensation. When an employee qualifies for an unreduced service retirement
allowance from the System, the benefits payable from the Disability Income Plan will cease, and the
employee will commence retirement under the Teachers' and State Employees' Retirement System.
57
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
6.Long-Term Obligations
The following is a summary o-term obligations for the year
ended June 30, 2012:
Compensated absences, net pension obligation, and other post-employment benefits liability for
governmental activities typically have been liquidated in the General Fund.
General long-term debt payable at June 30, 2012 is comprised of the following:
General Obligation Bonds.
All general obligation bonds, serviced by the County's General Fund,
are collateralized by the full faith, credit, and taxing power of the County. Principal and interest
payments are appropriated when due.
58
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
The County's general obligation bonds payable, serviced by the County's General Fund, are
comprised of the following individual issues:
Of the amount serviced by the County's General Fund shown above, $69,226,606 is considered to be
school bond debt.
Obligations Under Capital Leases.
The County has entered into agreements to lease certain
equipment. The lease agreements qualify as capital leases for accounting purposes and, therefore,
have been recorded at present value of the future minimum lease payments as the date of their
inception.
59
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Capital Leases Serviced by Governmental Funds:
Capital Leases Serviced by the County's Solid Waste Fund:
60
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Installment Notes Payable and Limited Obligation Bonds:
Serviced by Governmental Funds
:
61
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Serviced by the County's Enterprise Funds:
Of the amount serviced by governmental funds shown above, $79,941,432 is considered to be school
installment debt.
62
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
The annual requirements as of June 30, 2012 to amortize outstanding debt and funds available for
draw under general obligation bonds, installment purchase contracts, capital leases, exclusive of
accrued compensated absences, and the Separation Allowance are as follows:
In accordance with the provisions of the State Constitution and The Local Government Bond Act, as
amended, the County may, with certain exceptions, have outstanding net debt, excluding bonds issued for
water purposes, in principal amounts not exceeding 8% of the appraised value of property subject to
taxation. At June 30, 2012, such statutory limit for the County was approximately $1.3 billion, providing
a legal debt margin of approximately $1 billion.
Bonds authorized, but unissued, at June 30, 2012 were $23,900,000.
63
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Advanced Refundings
On November 15, 2011, the County issued $24,440,000 in 2011 Refunding General Obligation
Bonds. The proceeds were used to advance refund $23,540,000 of outstanding Public Improvement,
Series 2004 A and B and Public Improvement, Series 2005A General Obligation Bonds. The net
proceeds of $23,540,000 were deposited in an irrevocable trust with an escrow agent to provide funds
for the future debt service payment on the refunded bonds. As a result, the Public Improvement
General Obligation Bonds are considered defeased and the respective liability for those bonds has
been removed from the Statement of Net Assets. The reacquisition price exceeded the net carrying
amount of the old debt by $900,000. The County advance refunded the General Obligation bonds to
reduce its total debt service payments over 12 years by $1,652,510 and to obtain an economic gain
(difference between the present values of the debt service payments on the old and new debt) of
$1,436,657.
On September 29, 2011, the County issued $38,305,000 in 2011 Limited Obligation Bonds. The
proceeds were used to advance refund $42,565,192 of outstanding installment notes payable. The net
proceeds of $42,565,192 were deposited in an irrevocable trust with an escrow agent to provide funds
for the future debt service payment on the installment notes payable. As a result, the installment
notes payable are considered defeased and the respective liability have been removed from the
Statement of Net Assets. The County advance refunded the debt to reduce its total debt service
payments over 16 years by $2,007,589 and to obtain an economic gain (difference between the
present values of the debt service payments on the old and new debt) of $2,106,909.
On April 12, 2012, the County issued $58,980,000 in 2012 Limited Obligation Bonds. $25,031,500
of the Limited Obligation Bonds is new debt issuance. $33,948,500 of the proceeds were used to
advance refund $37,924,897 of outstanding installment notes payable and Certificates of
Participation. The net proceeds of $37,924,897 were deposited in an irrevocable trust with an escrow
agent to provide funds for the future debt service payment on the installment notes payable and
Certificates of Participation. As a result, the installment notes payable and Certificates of
Participation are considered defeased and the respective liability have been removed from the
Statement of Net Assets. The County advance refunded the debt to reduce its total debt service
payments over 4 years by $1,639,377 and to obtain an economic gain (difference between the present
values of the debt service payments on the old and new debt) of $1,455,273.
Conduit Debt Obligations.
Orange County Industrial Facility and Pollution Control Financing
Authority have issued industrial revenue bonds to provide financial assistance to Mebane Packaging
Company for economic development purposes. These bonds are secured by the properties financed,
as well as by letters of credit and are payable solely from payments received from the private business
involved. Ownership of the acquired facilities is in the name of the private business served by the
bond issuance. Neither the County, the Authority, the State, nor any political subdivision thereof is
obligated in any manner for the repayment of the bonds. Accordingly, the bonds are not reported as
liabilities in the accompanying financial statements. As of June 30, 2012, there is no balance
outstanding.
64
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
7.Deferred/Unearned Revenues
The balance in deferred revenues on the fund statements and unearned revenues on the government-
wide statements at year-end are composed of the following elements:
8. Capital Assets, Net of Related Debt
Capital assets, net of related debt, at June 30, 2012 are computed as follows:
65
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
9. Interfund Balances and Activity
The following is a schedule of interfund receivable and payable balances as of June 30, 2012:
All interfund balances and activities shown above resulted from loans made to supplement other
funding sources. These balances are not expected to be repaid within a year.
Transfers.
The following is a summary of transfers for the year ended June 30, 2012:
66
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Transfers are used to move unrestricted General Fund revenues to finance various programs that the
government must account for in other funds in accordance with budgetary authorizations, including
amounts provided as subsidies or matching funds for various grant programs.
10. Benefit Payments Issued by the State
The amounts listed below were paid directly to individual recipients by the State from federal and
State monies on behalf of the County. County personnel are involved with certain functions,
primarily eligibility determinations, which cause benefit payments to be issued by the State. These
amounts disclose this additional aid to County recipients, which do not appear in the basic financial
statements because they are not revenues and expenditures of the County.
11.Closure and Post-Closure Care Costs Landfill Facilities
Federal and State laws and regulations have required the County to place a final cover on its landfill
facility when it stopped accepting waste and to perform certain maintenance and monitoring functions
at the site for thirty years after closure. The County continues required monitoring during the post-
closure care period for up to thirty years. Post-closure costs consist of water quality monitoring,
maintenance of the landfill surface, vegetation, mowing, inspections, and recordkeeping. Costs
during the monitoring period are estimated to be $97,000 per year. The $13,741,104 reported as
landfill closure and post-closure care liability at June 30, 2012 represents a cumulative amount
reported to-date based on the use of 90 percent of the total estimated capacity of the landfill. The
County will recognize the remaining estimated cost of closure and post-closure care of $1 million as
the remaining estimated capacity is filled. These amounts are based on what it would cost to perform
all closure and post-closure care in 2012. The County expects to close the landfill in the year 2013.
Actual costs may be higher due to inflation, changes in technology, or changes in regulations.
The Orange Regional Landfill expects that any future inflation costs will be paid from the Landfill's
current enterprise funds or would be covered by charges to future landfill users.
The Orange Regional Landfill was required by federal and State laws and regulations to meet
financial assurance requirements effective April 9, 1994 to guarantee the ability to finance closure
and post-closure care. The financial assurance requirements can be met by meeting one of several
optional financial tests developed and required by the State of North Carolina Department of
Environment, Health, and Natural Resources.
67
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
In complying with these regulations during fiscal year 2012, the County has submitted certified
statements of Bond Indicators and Ratio Indicators of Financial Strength to the State of North
Carolina Department of Environment, Health, and Natural Resources.
Leases.
The County leases ambulances, car, and landfill equipment under lease agreements that are
classified as capital leases. Accordingly, the original present value ($7,079,224) of obligations under
these lease agreements, along with the present value of the remaining lease payments, are included
within the Statement of Activities for governmental activities. The General Fund and the Solid Waste
Fund make all capital lease payments.
At June 30, 2012, future minimum rental payments due under the capital leases are as follows:
The total rental paid for all operating leases was $336,005 for the year ended June 30, 2012. All
operating leases are for terms of one year or less and consist principally of office space rentals for
various County functions.
Federal and State Programs.
The County participates in a number of federal and State of North
Carolina financial assistance programs. For the fiscal year ended June 30, 2012, these programs were
subjected to audit in accordance with generally accepted auditing standards,Government Auditing
Standards, the provisions of OMB Circular A-133, and the State Single Audit Implementation Act.
The amount, if any, of expenditures which may be disallowed by the granting agencies resulting from
this and other audits cannot be determined at this time, although the County expects such amounts, if
any, to be immaterial. No provision has been made in the accompanying financial statements for the
refund of grant monies.
Lawsuits.
The County is involved in several pending lawsuits and claims, which it intends to defend
vigorously. In the opinion of the County's Attorney and management, the disposition of these matters
is not expected to have a material effect on the County's financial position.
12. Risk Management
The County is exposed to various risks of losses related to torts; theft of, damage to, and destruction
of assets; errors and omissions; injuries to employees; and natural disasters. The County participates
in three self-funded risk financing pools administered by the North Carolina Association of County
Commissioners. Through these pools, the County obtains property coverage equal to replacement
cost values of owned property subject to a limit of $125.5 million for any one occurrence, general,
auto, professional, and employment practices liability coverage of $2 million per occurrence, auto
physical damage coverage for owned autos at actual cash value, crime coverage of $250,000 per
occurrence, workers' compensation coverage up to the statutory limits, and health insurance for
68
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
County employees. The pools are audited annually by certified public accountants, and the audited
financial statements are available to the County upon request. Two of the pools are reinsured through
a multi-State public entity captive for single occurrence losses in excess of $500,000 up to a $2
million limit for liability coverage, $600,000 of aggregate annual losses in excess of $50,000 per
occurrence for property, auto physical damage, crime coverage, and single occurrence losses of
$350,000 for workers' compensation. For health and dental insurance, the County is reinsured
through the pool for individual losses in excess of $50,000 and aggregate annual losses in excess of
115% of expected claims. The pool is reinsured through commercial carrier for individual losses in
excess of $100,000.
A limited risk management program is also maintained for employees' dental benefits administered
by a third-party administrator. Premiums are paid into the Dental Internal Service Fund by all other
funds and are available to pay claims and administrative costs of the program. During fiscal year
2012, a total of $466,862 was incurred for benefits and administrative costs.
A summary of the reserve for incurred, but unreported, claims is as follows:
In accordance with G.S. 159-29, the County's employees who have access to $100 or more at any
given time of the County's funds are performance bonded through a commercial surety bond. The
Director of Finance and Tax Collector are each individually bonded for $250,000 and $30,000,
respectively. The remaining employees that have access to funds are bonded under a blanket bond for
$250,000.
The County carries commercial coverage for all other risks of loss. There have been no significant
reductions in insurance coverage from the previous year, and settled claims have not exceeded
coverage in any of the past three fiscal years.
The County carries flood insurance through the North Carolina Association of County
Commissioners Liability and Property Insurance Pool ("NCACC"). The County only has one
building located in an area that has been mapped and designated an "A" area (an area close to a river,
lake, or stream) by the Federal Emergency Management Agency. The County has purchased
coverage of $1,000,000 for the building located in the area designated as "A" above, and an additional
amount of flood insurance coverage of $5,000,000 for all other structures.
69
ORANGE COUNTY, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
13. Jointly Governed Organization
Orange Water and Sewer Authority.
The Orange Water and Sewer Authority is a public authority
created under North Carolina law, which was established for the purpose of providing water and
sewer service in a defined area within the County. The Authority has a nine-member governing body
with two members appointed by the Orange County Board of Commissioners, two members
appointed by the Board of Aldermen of the Town of Carrboro, and five members appointed by the
Mayor and Town Council of the Town of Chapel Hill. The County is not responsible for any debt of
the Authority or any of its deficits. The County is not entitled to surpluses of the Authority, has no
responsibility for the designation of its management, does not have any significant influence over its
operations, and the Authority is not accountable to the County for fiscal matters.
Triangle Transit Authority.
Orange County, in conjunction with other area local governments, is a
member of the Research Triangle Regional Public Transportation Authority. Orange County appoints
one member to the governing board. The Authority possesses final decision making ability and is
solely responsible for the management, budget, and fiscal operations of the Authority.
14. Joint Ventures
Hyconeechee Regional Library.
Public library services with Orange County are provided by a tri-
County regional library system. Person County, Orange County, and Caswell County each appoint
three members to the Regional Library Board. The County is neither responsible for any deficits nor
entitled to any surpluses. Since the Library cannot issue long-term debt under North Carolina law,
any such debt for the Library would be the responsibility of the counties involved. None of the
participating governments have any equity interest in the Library, so no equity interest has been
reflected in the financial statements at June 30. During 1994, the County accepted accountability for
the fiscal matters of the Library. The Library's financial statements are included as an agency fund of
the County. Complete financial statements for the Library can be obtained from the Library's offices
at 300 West Tryon Street, Hillsborough, North Carolina 27278.
Orange-Person-Chatham Area Mental Health, Mental Retardation, and Substance Abuse
Authority.
Mental health, mental retardation, and substance abuse services within the County are
provided by a tri-County regional authority. Each County appoints one Commissioner to the
Authority's sixteen-member Board. The remaining thirteen members are selected by the three
appointed Commissioners. Since the Authority does not have the power to issue debt obligations, any
such obligations would be issued by the counties involved. The County is not responsible for the
Authority's deficits and is not entitled to its surpluses. It also has no responsibility for the designation
of management and does not have significant influence over the operations of the Authority.
The County makes an annual appropriation to the Authority, but the majority of the funding comes
from other sources. During the fiscal year ended June 30, 2012, the County contributed $1,370,973 to
the Authority. None of the participating governments have any equity interest in the Authority, so no
equity interest has been reflected in the financial statements at June 30, 2012. Complete financial
statements for the Authority can be obtained from the Authority's offices at 100 Europe Drive, Suite
490, Chapel Hill, North Carolina 27517.
70
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Required Supplemental Financial Data
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Schedule A-1
ORANGE COUNTY, NORTH CAROLINA
LAW ENFORCEMENT OFFICERS' SPECIAL SEPARATION ALLOWANCE
REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2012
Schedule of Funding Progress
Actuarial
AccruedUAAL as a
ActuarialLiability (AAL)-UnfundedPercentage
ActuarialValue of Projected UnitAALFundedCoveredof Covered
ValuationAssetsCredit (UAAL)RatioPayrollPayroll
Date(a)(b)(b - a)(a/b)(c)((b -a) /c)
12/31/2011$ -$ 2,004,133$ 2,004,1330.00%$ 4,164,88848.12%
12/31/2010-1,931,9991,931,9990.00%4,104,15747.07%
12/31/2009-1,994,8771,994,8770.00%4,021,93649.60%
12/31/2008-1,586,1251,586,1250.00%4,042,49039.24%
12/31/2007-1,503,2421,503,2420.00%3,831,18239.24%
12/31/2006-1,427,9901,427,9900.00%3,721,93738.37%
Schedule of Employer Contributions
Annual
RequiredPercentage
Year EndedContributionof ARC
June 30(ARC)Contributed
$ 200,37676.79%
2012
204,80878.22%
2011
163,990112.55%
2010
2009149,948122.73%
2008148,678117.64%
2007148,779106.44%
Notes to the Required Schedules:
The information presented above was determined as part of the actuarial valuation at the dates indicated.
Additional information as of the latest valuation follows:
Valuation date 12/31/2010
Actuarial cost method Projected unit credit
Amortization method Level percent of pay closed
Remaining amortization period 20 years
Asset valuation method Market value
Actuarial assumptions:
Investment rate of return *5.00%
Projected salary increases *4.25 - 7.85%
Cost of living adjustmentsN/A
* Includes inflation at 3%
71
Schedule A-2
ORANGE COUNTY, NORTH CAROLINA
HEALTH CARE BENEFITS PLAN
REQURIED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2012
Schedule of Funding Progress
Actuarial
AccruedUAAL as a
ActuarialLiability (AAL)-UnfundedPercentage of
ActuarialValue of Projected UnitAALFundedCoveredCovered
ValuationAssetsCredit (UAAL)RatioPayrollPayroll
Date(a)(b)(b - a)(a/b)(c)((b-a)/c)
12/31/2005$ -$ 84,540,825$ 84,540,8250.00%$ 32,914,392256.9%
12/31/2007-54,382,27754,382,2770.00%37,345,503145.6%
12/31/2009-58,020,67458,020,6740.00%37,996,740152.7%
12/31/2010-62,803,09462,803,0940.00%38,421,649163.5%
12/31/2011-63,716,14263,716,1420.00%38,572,921165.2%
Schedule of Employer Contributions
Annual
Percentage
Required
Year Endedof ARC
Contribution
June 30(ARC)Contributed
$ 5,374,42932.14%
2012
5,075,37137.52%
2011
20105,301,17121.24%
20095,109,56219.67%
20088,829,7049.57%
Notes to the Required Schedules:
The information presented above was determined as part of the actuarial valuation at the dates indicated.
Additional information as of the latest valuation follows:
Valuation date12/31/2011
Actuarial cost methodProjected unit credit
Amortization methodLevel percentage of pay, open
Remaining amortization period30 years
Asset valuation methodMarket value of assets
Actuarial assumptions:
Investment rate of return *4.00%* Includes inflation at 3.00%
Medical cost trend rate
Pre-Medicare trend rate9.50%-5.00%
Post-Medicare trend rate7.00%-5.00%
Year of Ultimate trend rate2018
72
General Fund
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Schedule B-1
ORANGE COUNTY, NORTH CAROLINA
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - ACTUAL - GENERAL FUND CONSOLIDATED
FOR THE YEAR ENDED JUNE 30, 2012
Property Total
GeneralRevaluationGeneral
FundFundEliminationsFund
Revenues:
Property taxes$ 136,485,507$ -$ -$ 136,485,507
Sales tax17,562,303--17,562,303
Intergovernmental revenues19,794,026--19,794,026
Charges for services9,406,210--9,406,210
Investment earnings51,20190-51,291
Licenses and permits329,265--329,265
824,545--824,545
Miscellaneous
184,453,05790-184,453,147
Total revenues
Expenditures:
Governing and management11,946,149--11,946,149
General services5,602,554--5,602,554
Community and environment5,520,83592,695-5,613,530
Human services32,276,333--32,276,333
Education63,939,903--63,939,903
Public safety18,875,222--18,875,222
Culture and recreation2,078,964--2,078,964
Debt service:
Principal18,718,055--18,718,055
7,745,070--7,745,070
Interest and fees
166,703,08592,695-166,795,780
Total expenditures
Revenues over (under) expenditures 17,749,972(92,605)-17,657,367
Other Financing Sources (Uses):
Capital lease issuance531,500--531,500
Transfers in1,040,000185,000(185,000)1,040,000
(8,839,248)-185,000(8,654,248)
Transfers out
(7,267,748)185,000-(7,082,748)
Total other financing sources (uses)
Net change in fund balance10,482,22492,395-10,574,619
Fund Balance:
37,231,36353,524-37,284,887
Beginning of year - July 1
$ 47,713,587$ 145,919$ -$ 47,859,506
End of year - June 30
73
Schedule B-2
Page 1 of 4
ORANGE COUNTY, NORTH CAROLINA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
WITH COMPARATIVE ACTUAL AMOUNTS FOR THE YEAR ENDED JUNE 30, 2011
20122011
FinalVariance
BudgetActualOver/Under
Actual
Revenues:
Ad Valorem Taxes:
Property tax$ 132,629,175$ 135,873,089$ 3,243,914$ 134,058,937
Tax penalties and interest410,000552,037142,037533,864
42,00060,38118,38155,526
Gross receipts tax
133,081,175136,485,5073,404,332134,648,327
Total
Sales Tax:
15,283,79017,562,3032,278,51315,115,418
Local option sales tax
15,283,79017,562,3032,278,51315,115,418
Total
Intergovernmental Revenues:
Refunds, gasoline tax---1,562
Animal tax203,605237,05333,448209,422
Beer and wine tax215,000225,88210,882217,536
Federal and State grants19,742,27618,345,267(1,397,009)18,873,982
Local grants435,520453,11717,597439,173
ABC Board law enforcement distribution120,00086,264(33,736)111,096
440,000446,4436,443443,709
ABC Board profit distribution
21,156,40119,794,026(1,362,375)20,296,480
Total
Charges for Services:
Register of Deeds1,342,0621,241,213(100,849)1,361,437
Collection fees221,482308,05686,574296,948
Inspection fees515,450479,918(35,532)473,269
Health service fees1,460,9091,229,328(231,581)1,059,136
Recreation fees231,491279,36047,869234,497
Planning fees182,000113,850(68,150)108,666
Aging fees131,875127,320(4,555)132,078
EMS fees2,040,0002,314,772274,7722,567,951
Sheriff and court charges2,445,7112,453,6127,9012,390,367
909,623858,781(50,842)964,439
Other charges
9,480,6039,406,210(74,393)9,588,788
Total
140,00051,201(88,799)69,164
Investment Earnings
Licenses and Permits:
Privilege licenses13,00011,435(1,565)12,140
300,000317,83017,830390,874
Franchise fees
313,000329,26516,265403,014
Total
74
Schedule B-2
Page 2 of 4
ORANGE COUNTY, NORTH CAROLINA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
WITH COMPARATIVE ACTUAL AMOUNTS FOR THE YEAR ENDED JUNE 30, 2011
20122011
FinalVariance
BudgetActualOver/Under
Actual
Miscellaneous Revenues:
Donations263,400258,807(4,593)247,647
Rent336,001336,0054328,983
165,327229,73364,406191,519
Other
764,728824,54559,817768,149
Total
180,219,697184,453,0574,233,360180,889,340
Total revenues
Expenditures:
Governing and Management:
County commissioners598,091556,39241,699511,073
County manager717,265706,54410,721712,820
Animal services1,661,1221,554,838106,2841,522,940
Human resources698,576634,34264,234672,869
Financial services1,056,609956,515100,094901,036
County Attorney465,216442,08223,134438,142
Asset management and purchasing6,602,4345,280,6251,321,8095,253,505
2,130,3361,814,811315,5251,534,647
Non-departmental
13,929,64911,946,1491,983,50011,547,032
Total
General Services:
Information systems2,245,2862,068,539176,7471,722,470
Register of Deeds876,649835,47741,172831,423
Tax administration2,331,1952,016,180315,0152,164,403
Elections699,099579,953119,146446,756
Sanitation---17,665
102,549102,405144102,327
Non-departmental
6,254,7785,602,554652,2245,285,044
Total
Community and Environment:
Planning2,477,3952,162,186315,2092,396,164
DEAPR2,920,6332,775,044145,5892,878,612
Economic development414,600359,29255,308379,894
283,304224,31358,991179,889
Non-departmental
6,095,9325,520,835575,0975,834,559
Total
75
Schedule B-2
Page 3 of 4
ORANGE COUNTY, NORTH CAROLINA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
WITH COMPARATIVE ACTUAL AMOUNTS FOR THE YEAR ENDED JUNE 30, 2011
20122011
FinalVariance
BudgetActualOver/Under
Actual
Human Services:
Social services20,950,21518,668,1692,282,04618,456,611
Health8,605,1128,168,390436,7228,246,982
Cooperative extension392,184338,32653,858330,625
Aging2,462,8632,268,145194,7182,541,254
Human rights and relations285,227278,2916,936277,285
Child support enforcement1,010,771972,74738,024928,438
Mental health---1,398
1,594,5321,582,26512,2671,676,157
Non-departmental
35,300,90432,276,3333,024,57132,458,750
Total
Education:
Current expense59,912,90359,912,903-59,909,513
Capital outlay3,039,0003,039,000-3,015,000
988,000988,000-988,000
Non-departmental
63,939,90363,939,903-63,912,513
Total
Public Safety:
Sheriff11,581,10210,893,849687,25310,975,035
Emergency services8,212,0737,501,352710,7217,197,276
Courts89,93664,01725,919148,189
439,849416,00423,845338,490
Non-departmental
20,322,96018,875,2221,447,73818,658,990
Total
Cultural and Recreational:
Library services1,675,0361,654,35720,6791,472,311
470,723424,60746,116338,622
Non-departmental
2,145,7592,078,96466,7951,810,933
Total
Debt Service:
Principal On Bonds:
School bond7,452,8508,233,564780,7147,475,585
County bond1,417,1501,456,82539,6751,554,415
Private Placement:
Schools4,790,6534,607,605(183,048)5,068,595
5,008,2824,420,061(588,221)4,617,115
County
18,668,93518,718,05549,12018,715,710
Total
76
Schedule B-2
Page 4 of 4
ORANGE COUNTY, NORTH CAROLINA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
WITH COMPARATIVE ACTUAL AMOUNTS FOR THE YEAR ENDED JUNE 30, 2011
20122011
FinalVariance
BudgetActualOver/Under
Actual
Interest and Fees:
School bond interest3,737,9672,542,1421,195,8253,681,763
County bond interest1,180,335647,389532,946972,551
School private placement interest1,538,0161,402,150135,8661,956,739
2,230,4013,153,389(922,988)3,298,886
County private placement interest
8,686,7197,745,070941,6499,909,939
Total
27,355,65426,463,125892,52928,625,649
Total debt service
175,345,539166,703,0858,642,454168,133,470
Total expenditures
4,874,15817,749,97212,875,81412,755,870
Revenues over (under) expenditures
Other Financing Sources (Uses):
Capital lease issuances574,484531,500(42,984)-
Transfers in1,064,9171,040,000(24,917)1,339,227
Transfers out(9,864,248)(8,839,248)1,025,000(8,305,776)
3,350,689-(3,350,689)-
Appropriated fund balance
(4,874,158)(7,267,748)(2,393,590)(6,966,549)
Total other financing sources (uses)
$ -$ 10,482,224
Net change in fund balance10,482,2245,789,321
Fund Balance:
37,231,36331,442,042
Beginning of year - July 1
$ 47,713,587$ 37,231,363
End of year - June 30
77
Schedule B-3
ORANGE COUNTY, NORTH CAROLINA
PROPERTY REVALUATION FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
$ -$ 90$ 90
Investment earnings
-9090
Total revenues
Expenditures:
Community and Environment:
Property revaluation:
Personnel services148,06537,791110,274
78,98154,90424,077
Operations
227,04692,695134,351
Total expenditures
(227,046)(92,605)134,441
Revenues over (under) expenditures
Other Financing Sources (Uses):
Transfers in185,000185,000-
42,046-(42,046)
Appropriated fund balance
227,046185,000(42,046)
Total other financing sources (uses)
Net change in fund balance$ -$ 92,395
92,395
Fund Balance:
53,524
Beginning of year - July 1
$ 145,919
End of year - June 30
78
Major Governmental Funds
Capital Projects Fund
The Capital Projects Funds account for all resources used by the county for the acquisition and/or
construction of capital facilities, except those financed by Enterprise Funds.
County Capital Improvements Fund -
accounts for financial resources used in the acquisition,
renovation and improvement of public facilities.
School Capital Improvements Fund -
accounts for financial resources used in the construction,
acquisition and renovation of public school facilities.
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Schedule B-4
Page 1 of 2
ORANGE COUNTY, NORTH CAROLINA
COUNTY CAPITAL IMPROVEMENTS FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FROM INCEPTION AND FOR THE YEAR ENDED JUNE 30, 2012
Actual
BudgetReported inClosedCurrentTotal
to DatePrior YearsProjectsYearto Date
Revenues:
Federal grants$3,735,900$ 3,027,152$-$564,573$3,591,725
State grants7,275,242 2,622,563-2,452,2915,074,854
Investment earnings2,624,400 2,638,696-693,1403,331,836
1,472,6653,103,947-171,7803,275,727
Other
15,108,20711,392,358-3,881,78415,274,142
Total revenues
Expenditures:
New Hope Creek Preserve40,000 --- -
Jail1,375,000 111,778--111,778
Justice facility and new courthouse12,229,07312,326,996--12,326,996
New courthouse- 218,797--218,797
Northern Human Services Center714,545 363,931--363,931
Senior Center- Central Orange6,460,533 6,147,769--6,147,769
Southern Human Services Center280,000 --- -
Animal services facility9,168,864 9,098,921-26,6709,125,591
EMS relocation and meadowlands annex3,531,714 3,510,935-17,0503,527,985
County campus, office building, and library26,899,00025,835,795-3,00025,838,795
County other- 271,465-4,219275,684
Blackwood Farm2,437,435 2,276,728-2,4422,279,170
Cedar Grove Park1,848,000 1,847,084-4491,847,533
Twin Creeks Park1,979,457 835,357-9,580844,937
Fairview Park1,615,023 1,577,938-16,0421,593,980
Conservation easement1,697,208 48,035-1,620,6981,668,733
Homestead Aquatics- 83,346--83,346
Lands Legacy - unallocated1,666,909 101,290-10,000111,290
Parkland and recreation facilities103,530 175,011--175,011
Seven Mile Creek Preserve151,000 145,689--145,689
Southern Park- 38,196--38,196
SportsPlex Maintenance Reserve100,000 --- -
West Ten soccer complex4,054,128 4,054,616--4,054,616
Central recreation repairs416,980 412,323--412,323
Millhouse Road Park264,802 256,932-1,780258,712
Roofing projects1,333,100 1,115,204-6,9001,122,104
Affordable housing2,638,804 1,577,095-106,6241,683,719
Information technology4,067,757 1,961,249-728,9832,690,232
Register of Deeds' automation enhancement425,450 42,297-37442,671
Medicaid maximization2,884,809 1,078,263-784,7681,863,031
Loan Pool Reserve275,000 120,000-80,000200,000
Efland sewer extension1,798,240 80,456-93081,386
HVAC projects502,223 617,222--617,222
ADA compliance16,058 16,058--16,058
79
Schedule B-4
Page 2 of 2
ORANGE COUNTY, NORTH CAROLINA
COUNTY CAPITAL IMPROVEMENTS FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FROM INCEPTION AND FOR THE YEAR ENDED JUNE 30, 2012
Actual
BudgetReported inClosedCurrentTotal
to DatePrior YearsProjectsYearto Date
Utilities demand reduction systems130,000 106,055--106,055
Upfit of County Space - Link Center1,727,662 523,711-720,6041,244,315
Telephone system replacement575,000 562,748--562,748
Hillsborough Commons3,790,000 3,780,709--3,780,709
Board of Elections office97,000 32,975-1,77534,750
Piedmont Food and Agriculture Processing 1,343,225 1,131,003-246,8861,377,889
800 MHz Radios700,000 473,436--473,436
Dental equipment100,000 --74,19074,190
Buckhorn EDD Phase 2200,000 66,500-119,890186,390
Payroll Software System329,861 --307,154307,154
129 East King Street145,000 --43,41243,412
Central Efland Buckhorn Sewer4,848,400 --2,064,5662,064,566
Lake Orange Capital Maintenance 116,274-189,647
277,00073,373
Observation Well Network11,330 11,297--11,297
Jail New Campus- --3,4193,419
650,00052,406-4,17056,576
Southwest Branch Library
105,899,12083,203,890-7,079,94890,283,838
Total expenditures
(90,790,913)(71,811,532)-(3,198,164)(75,009,696)
Revenues over (under) expenditures
Other Financing Sources (Uses):
Bond issuance costs and interest expense12,345,79410,037,994-(7,535,123)2,502,871
Refunding bonds135,000,60922,455,000-96,693,500119,148,500
Bond premium18,696,911 1,762,954-14,195,36015,958,314
Installment loan issuance62,490,20257,468,407--57,468,407
Capital lease issuance- 2,540,999--2,540,999
Payment to escrow agent(153,906,103)(24,021,358)-(104,030,089)(128,051,447)
Transfers in18,521,56315,443,409-783,24316,226,652
Transfers out(3,705,000)(3,268,520)--(3,268,520)
1,346,937----
Appropriated fund balance
90,790,91382,418,885-106,89182,525,776
Total other financing sources (uses)
$-$10,607,353$-$7,516,080
Net change in fund balance(3,091,273)
Fund Balance:
10,607,353
Beginning of year - July 1
$7,516,080
End of year - June 30
80
Schedule B-5
Page 1 of 2
ORANGE COUNTY, NORTH CAROLINA
SCHOOL CAPITAL IMPROVEMENTS FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FROM INCEPTION AND FOR THE YEAR ENDED JUNE 30, 2012
Actual
BudgetReported inClosedCurrentTotal
to DatePrior YearsProjectsYearto Date
Revenues:
Investment earnings$ 60,000$ 555,825$ -$ 7,438$ 563,263
Sales tax180,00075,000--75,000
Lottery proceeds2,892,1392,959,057--2,959,057
---33,75933,759
Other
3,132,1393,589,882-41,1973,631,079
Total revenues
Expenditures:
Orange County Schools:
A.L. Stanback Middle School32,000----
Cameron Park Elementary590,600507,402-15,960523,362
Efland Cheeks Elementary423,449238,748-136,985375,733
Grady Brown Elementary54,04054,023--54,023
Hillsborough Elementary365,000241,878--241,878
New Hope Elementary renovations325,000242,740--242,740
Stanford Middle School688,065176,073-164,535340,608
Orange High School559,435508,744-44,437553,181
Orange High Track Repairs495,634495,634--495,634
Alternative School356,720302,111--302,111
Central elementary air174,900136,059-2,542138,601
Classroom improvements3,769,440734,436-1,835,1442,569,580
Electrical Systems245,000--170,685170,685
Window Replacements195,322--158,136158,136
Kitchen renovations project27,785----
Roofing projects1,600,000905,350-690,5931,595,943
Technology plan1,422,668664,224-656,2011,320,425
HVAC Upgrade/Improvements713,850--489,432489,432
District-wide improvements200,000175,869-54,333230,202
Bathroom renovations180,53283,682--83,682
318,569249,042--249,042
Fire/safety upgrades
12,738,0095,716,015-4,418,98310,134,998
Total Orange County Schools
81
Schedule B-5
Page 2 of 2
ORANGE COUNTY, NORTH CAROLINA
SCHOOL CAPITAL IMPROVEMENTS FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FROM INCEPTION AND FOR THE YEAR ENDED JUNE 30, 2012
Actual
BudgetReported inClosedCurrentTotal
to DatePrior YearsProjectsYearto Date
Chapel Hill Carrboro Schools:
Elementary #1123,637,196917,341-3,026,9233,944,264
Morris Grove Elementary40,00038,686-22538,911
Transportation Center309,500289,540--289,540
Carrboro High School75,0006,223-68,77775,000
Carrboro Arts Wing4,066,4344,023,260-23,3874,046,647
Abatement projects343,000237,531-30,005267,536
ADA requirements140,505141,371--141,371
ATH facilities/playgrounds590,00093,572-197,035290,607
Classroom/academic improvements595,00058,259-432,358490,617
Doors, hardware, canopies77,65447,604-2,39650,000
Electrical systems339,740146,805-194,101340,906
Fire, safety, and security385,000104,743-123,683228,426
Indoor air quality451,340199,220-215,340414,560
Mechanical systems1,705,968578,627-576,1701,154,797
Mobile classrooms352,696227,348-107,930335,278
Parking lot improvements320,00011,015-7,40018,415
Planning for future projects150,000----
Roofing projects5,360,0091,228,682-2,037,7153,266,397
Bathroom renovations175,000----
Technology3,977,0032,739,432-1,237,5713,977,003
353,658308,031--308,031
Window replacements
43,444,70311,397,290-8,281,01619,678,306
Total Chapel Hill Carrboro Schools
60,00039,115--39,115
Other expenditures
56,242,71217,152,420-12,699,99929,852,419
Total expenditures
(53,110,573)(13,562,538)-(12,658,802)(26,221,340)
Revenues over (under) expenditures
Other Financing Sources (Uses):
Bonds issuance14,170,87414,170,873--14,170,873
Installment loan insurance22,000,00010,926,288-21,500,00032,426,288
16,939,699--5,453,6205,453,620
Transfers in
53,110,57325,097,161-26,953,62052,050,781
Total other financing sources (uses)
$ -$ 11,534,623$ -$ 25,829,441
Net change in fund balance14,294,818
Fund Balance:
Beginning of year - July 1
11,534,623
$ 25,829,441
End of year - June 30
82
Nonmajor Governmental Funds
Capital Project Funds:
School Capital Reserve Fund -accounts for property tax revenues dedicated to the acquisition of land for future
school and park sites.
County Capital Reserve Fund -accounts for accumulation of funds and revenues dedicated to address future County capital
needs.
Special Revenue Funds:
Special Revenue Funds are used to account for financial resources that are restricted by law or administration action
to finance particular functions or activities.
Impact Fee Fund -accounts for fees assessed on new residential development within the County. These fees are to be
used for the construction of public school facilities throughout the County.
Community Development Fund -accounts for federal funds used for residential rehabilitation, street improvements,
water and sewer, recreational facilities, relocation assistance in low income neighborhoods and affordable housing
initiatives. This multi-year project is accounted for on a federal fiscal year basis.
Section 8 Housing Fund -accounts for HUD-funded programs, Section 8 Vouchers Program.
Grant Supported Fund -accounts for grants awarded for various County departments on the County's fiscal year
basis.
Grant Projects Fund -accounts for grants awarded for various County departments on a federal fiscal year basis.
Emergency Telephone System Fund -accounts for revenues from E-911 subscriber fees and wireless 911 fees and
expenditures associated with the purchase and maintenance of emergency communications equipment for the enhanced
911 computer aided dispatch system.
Visitors' Bureau Fund -accounts for proceeds of a 2% County-wide hotel/motel occupancy tax which is used by the
Visitors' Bureau to maximize the economic benefit derived from visitors to the County.
Local Fire Districts Fund -accounts for the collection of special fire district taxes that are returned quarterly to the fire
districts on a budgeted basis.
Heusner Fund -accounts for donations made by private individuals for use in foster care programs administered by the
Department of Social Services.
Library Development Fund -accounts for donations made by private individuals for use in the County library.
Adoption Enhancement Fund -accounts for monies collected by Social Services from parents for the fees related to the
adoption of a child.
Recreation Subdivision Fund -accounts for payments received from local developers to assist in construction of
recreation projects in and around County subdivisions.
Article 46 Sales Tax Fundaccounts for the revenues received from the Article 46 ¼ cents sales tax and the related project
expenditures for the fund.
Piedmont Food and Agricultural Processing Centeraccounts for the transactions of the Piedmont Food and Agricultural
Processing Center located in Hillsborough and is a collaborative effort to expand agricultural and retail food based enterprise
businesses in the four county area.
Spay/Neuter Fund -accounts for donations and fees received by private individuals to promote pet sterilization throughout
the county.
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Schedule C-1
ORANGE COUNTY, NORTH CAROLINA
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
JUNE 30, 2012
NonmajorNonmajorTotal
CapitalSpecial Nonmajor
ProjectRevenueGovernmental
FundsFundsFunds
Assets:
Cash and investments$ 145,760$ 5,953,221$ 6,098,981
Account receivable:
Property taxes, net-95,60395,603
Federal-8,5978,597
State-755,882755,882
-1,873,3381,873,338
Other
$ 145,760$ 8,686,641$ 8,832,401
Total assets
Liabilities and Fund Balances:
Liabilities:
Accounts payable
and accrued liabilities$ -$ 154,170$ 154,170
Due to other funds-230,096230,096
-1,160,7381,160,738
Deferred revenue
-1,545,0041,545,004
Total liabilities
Fund Balances:
Restricted for:
Stabilization for State statute-1,625,0361,625,036
Restricted, all other-2,143,9742,143,974
Committed:145,760723,920869,680
Assigned-2,903,6612,903,661
-(254,954)(254,954)
Unassigned
145,7607,141,6377,287,397
Total fund balances
$ 145,760$ 8,686,641$ 8,832,401
Total liabilities and fund balances
83
Schedule C-2
ORANGE COUNTY, NORTH CAROLINA
NONMAJOR SPECIAL REVENUE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2012
NonmajorNonmajorTotal
CapitalSpecial Nonmajor
ProjectRevenueGovernmental
FundsFundsFunds
Revenues:
Property taxes$ -$ 4,656,071$ 4,656,071
Article 46 sales tax-709,663709,663
Intergovernmental revenues-5,778,0725,778,072
Charges for services-687,871687,871
Investment earnings1934,1804,373
Impact fees-1,648,2351,648,235
Asset management-63,57563,575
-365,015365,015
Miscellaneous
19313,912,68213,912,875
Total revenues
Expenditures:
Current:
General services-953,510953,510
Community and environment-6,694,7666,694,766
Human services-385,252385,252
-4,188,4234,188,423
Public safety
-12,221,95112,221,951
Total expenditures
1931,690,7311,690,924
Revenues over (under) expenditures
Other Financing Sources (Uses):
Transfers in-386,648386,648
(334,894)(1,040,000)(1,374,894)
Transfer out
(334,894)(653,352)(988,246)
Total other financing sources (uses)
Net change in fund balances(334,701)1,037,379702,678
Fund Balances:
480,4616,104,2586,584,719
Beginning of year - July 1
$ 145,760$ 7,141,637$ 7,287,397
End of year - June 30
84
Schedule C-3
ORANGE COUNTY, NORTH CAROLINA
NONMAJOR CAPITAL PROJECT FUNDS
COMBINING BALANCE SHEET
JUNE 30, 2012
SchoolCounty Total
CapitalCapital Nonmajor
ReserveReserveGovernmental
FundFundFunds
Assets:
Cash and investments$ 113,294$ 32,466$ 145,760
$ 113,294$ 32,466$ 145,760
Total assets
Fund Balances:
Committed:
Education$ 113,294$ -$ 113,294
-32,46632,466
Governing and management
113,29432,466145,760
Total fund balances
$ 113,294$ 32,466$ 145,760
Total liabilities and fund balances
85
Schedule C-4
ORANGE COUNTY, NORTH CAROLINA
NONMAJOR CAPITAL PROJECT FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2012
SchoolCounty Total
CapitalCapital Nonmajor
ReserveReserveGovernmental
FundFundFunds
Revenues:
Investment earnings$ 72$ 121$ 193
72121193
Total revenues
Other Financing Sources (Uses):
-(334,894)(334,894)
Transfers out
-(334,894)(334,894)
Total other financing sources (uses)
Net change in fund balances72(334,773)(334,701)
Fund Balances:
113,222367,239480,461
Beginning of year - July 1
$ 113,294$ 32,466$ 145,760
End of year - June 30
86
Schedule C-5
ORANGE COUNTY, NORTH CAROLINA
SCHOOL CAPITAL RESERVE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Investment earnings$ -$ 72$ 72
-7272
Total revenues
$ -72$ 72
Net change in fund balance
Fund Balance:
113,222
Beginning of year - July 1
$ 113,294
End of year - June 30
87
Schedule C-6
ORANGE COUNTY, NORTH CAROLINA
COUNTY CAPITAL RESERVE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCES - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
$ -$ 121$ 121
Investment earnings
-121121
Total revenues
Other Financing Sources (Uses):
Appropriated Fund Balance334,894-(334,894)
(334,894)(334,894)-
Transfer to County Capital Project Fund
-(334,894)(334,894)
Total other financing sources (uses)
$ -$ (334,773)
Net change in fund balance(334,773)
Fund Balance:
367,239
Beginning of year - July 1
$ 32,466
End of year - June 30
88
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ORANGE COUNTY, NORTH CAROLINA
NONMAJOR SPECIAL REVENUE FUNDS
COMBINING BALANCE SHEET
JUNE 30, 2012
Emergency
ImpactCommunitySection 8GrantGrantTelephoneVisitors'
FeeDevelopmentHousingSupportedProjectsSystemBureau
Assets:
Cash and investments$2,185,090$-$ 594,402$197,507$680,034$516,538$ 519,611
Account receivable:
Property taxes, net -- -- -- -
Federal - -- 8,597- -
State -- -- -46,232 -
338,7471,397,819-12,7819,937- 91,422
Other
$2,523,837$1,397,819$594,402$210,288$698,568$562,770$ 611,033
Total assets
Liabilities and Fund Balances:
Liabilities:
Accounts payable
and accrued liabilities$ -$12,830$ 25,986$35,486$ 17,224$9,953$ 34,279
Due to other funds -199,505 -- -- -
-1,000,000-63,656-- -
Deferred revenue
-1,212,33525,98699,14217,2249,953 34,279
Total liabilities
Fund Balances:
Restricted:
Stabilization by State statute338,747397,819 -- 18,53446,232 91,422
Restricted, all other -- 568,416111,146 -506,585 485,332
Committed
----662,810--
Assigned2,185,090- -- -- -
-(212,335)---- -
Unassigned
2,523,837185,484568,416111,146681,344552,817 576,754
Total fund balances
$2,523,837$1,397,819$594,402$210,288$698,568$562,770$ 611,033
Total liabilities and fund balances
89
Schedule D-1
Piedmont Total
LocalArticle 46 Food andNonmajor
FireLibraryAdoptionRecreationSalesAgricultural SpaySpecial Revenue
DistrictsHeusnerDevelopmentEnhancementSubdivisionTaxProcessing CenterNeuterFunds
$ 472,495$ 9,150$139,005$ 62,620$471,513$-$ -$ 105,256$5,953,221
95,603 -- --- - -95,603
- -- --- - -8,597
- -- --709,650 - -755,882
- -----22,632 -1,873,338
$ 568,098$ 9,150$139,005$62,620$471,513$709,650$22,632$ 105,256$8,686,641
$ -$ -$-$ 31$-$-$12,028$ 6,353$154,170
- -- --19,98710,604 -230,096
95,603 --1,479--- -1,160,738
95,603 --1,510-19,98722,632 6,3531,545,004
- -- --709,65022,632 -1,625,036
472,495 -- --- - -2,143,974
723,920
---61,110----
- 9,150139,005 -471,513- - 98,9032,903,661
- ----(19,987)(22,632) -(254,954)
472,495 9,150139,00561,110471,513689,663- 98,9037,141,637
$ 568,098$ 9,150$139,005$62,620$471,513$709,650$22,632$ 105,256$8,686,641
-
90
ORANGE COUNTY, NORTH CAROLINA
NONMAJOR SPECIAL REVENUE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2012
Emergency
ImpactCommunitySection 8GrantGrantTelephoneVisitors'
FeeDevelopmentHousingSupportedProjectsSystemBureau
Revenues:
Property taxes$ -$-$ -$-$ -$-$1,038,383
Article 46 sales tax -- -- -- -
Intergovernmental revenues -650,752 4,042,427377,306 620,552-29,891
Charges for services -- -35,917 -554,787 -
Investment earnings 1,609- 524- -334 790
Impact fees 1,648,235- -- -- -
Asset Management -- -63,575 -- -
-72,331-15 --150,587
Miscellaneous
1,649,844723,0834,042,951476,813 620,552555,1211,219,651
Total revenues
Expenditures:
Current:
General services -953,510 -- -- -
Community and environment -- 4,745,727548,027 41,654-1,095,499
Human services -- -- 362,666- -
---- 100,692505,930-
Public safety
-953,5104,745,727548,027 505,012505,9301,095,499
Total expenditures
1,649,844(230,427)(702,776)(71,214) 115,54049,191124,152
Revenues over (under) expenditures
Other Financing Sources (Uses):
Transfers in -228,437 86,99771,214 -- -
(1,040,000)--- ---
Transfer out
(1,040,000)228,43786,99771,214 ---
Total other financing sources (uses)
Net change in fund balances 609,844(1,990) (615,779)- 115,54049,191124,152
Fund Balances:
1,913,993187,4741,184,195111,146 565,804503,626452,602
Beginning of year - July 1
$2,523,837$185,484$568,416$111,146$ 681,344$552,817$576,754
End of year - June 30
91
Schedule D-2
Piedmont Total
LocalArticle 46 Food andNonmajor
FireLibraryAdoptionRecreationSalesAgricultural SpaySpecial Revenue
DistrictsHeusnerDevelopmentEnhancementSubdivisionTaxProcessing CenterNeuterFunds
$3,617,688$ -$-$-$-$ -$ -$ -$4,656,071
- ---- 709,663 - -709,663
- ---- -57,144 -5,778,072
- --22,376- -42,449 32,342687,871
369 612540299 -25 594,180
- ---- - - -1,648,235
- ---- - - -63,575
- ---6,678 100,000- 35,404365,015
3,618,057 612522,4166,977 809,66399,618 67,80513,912,682
- ---- - - -953,510
- ---- 120,00099,618 44,2416,694,766
- --22,586- - - -385,252
3,581,801 ---- -- -4,188,423
3,581,801 --22,586- 120,00099,618 44,24112,221,951
36,256 6125(170)6,977 689,663- 23,5641,690,731
- ---386,648
----
- ---- -- -(1,040,000)
- ---- -- -(653,352)
36,256 6125(170)6,977 689,663 - 23,5641,037,379
436,239 9,144138,88061,280464,536 -- 75,3396,104,258
$472,495$ 9,150$139,005$61,110$471,513$ 689,663$-$ 98,903$7,141,637
92
Schedule D-3
ORANGE COUNTY, NORTH CAROLINA
IMPACT FEE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Impact Fees:
Fees - Orange County Schools$ 520,000$ 646,733$ 126,733
520,0001,001,502481,502
Fees - Chapel Hill, Carrboro
1,040,0001,648,235608,235
Total impact fees
Investments Earnings:
Orange County Schools-748748
-861861
Chapel Hill, Carrboro Schools
-1,6091,609
Total investment earnings
1,040,0001,649,844609,844
Total revenues
Other Financing Sources (Uses):
(1,040,000)(1,040,000)-
Transfers out
(1,040,000)(1,040,000)-
Total other financing sources (uses)
$ -$ 609,844
Net change in fund balance609,844
Fund Balance:
1,913,993
Beginning of year - July 1
$ 2,523,837
End of year - June 30
93
Schedule D-4
ORANGE COUNTY, NORTH CAROLINA
COMMUNITY DEVELOPMENT FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FROM INCEPTION AND FOR THE YEAR ENDED JUNE 30, 2012
Actual
BudgetReported inCurrentTotal
to DatePrior YearYearto Date
Revenues:
HUD grants$ 10,365,481$ 9,078,517$ 263,237$ 9,341,754
CDBG grants:
Scattered site1,300,000420,535160,714581,249
HOME partnership803,600803,600-803,600
IDA95,00065,000-65,000
Hookup Grant75,000-53,71853,718
Investment earnings1,0008,394-8,394
Program income - HOME1,762,697914,463173,0831,087,546
185,90241,52872,331113,859
Other
14,588,68011,332,037723,08312,055,120
Total revenues
Expenditures:
General Services:
Administration-1,632,042-1,632,042
Administration - scattered site-78,430-78,430
Administration - IDA170,000192,144-192,144
Rehabilitation2,554,6015,179,900223,8995,403,799
Rehabilitation - HOME partnership291,997613,19568,718681,913
Rehabilitation - scattered site800,000325,455115,512440,967
Affordable housing - impact fee reimbursement990,6533,438,697-3,438,697
Affordable housing - HOME partnership12,323,8822,697,471484,1623,181,633
Public facilities improvement - HOME partnership
803,600197,098-197,098
75,000-61,21961,219
Administration - Hookup
18,009,73314,354,432953,51015,307,942
Total expenditures
Revenues over (under) expenditures(3,421,053)(3,022,395)(230,427)(3,252,822)
Other Financing Sources (Uses):
Transfers in3,407,0873,996,960228,4374,225,397
Transfers out-(787,091)-(787,091)
13,966---
Appropriated fund balance
3,421,0533,209,869228,4373,438,306
Total other financing sources (uses)
$ -$ 187,474$ 185,484
Net change in fund balance(1,990)
Fund Balance:
187,474
Beginning of year - July 1
$ 185,484
End of year - June 30
94
Schedule D-5
ORANGE COUNTY, NORTH CAROLINA
SECTION 8 HOUSING FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Federal grants:
Housing vouchers$ 4,598,183$ 4,042,427$ (555,756)
-524524
Investment earnings
4,598,1834,042,951(555,232)
Total revenues
Expenditures:
Community and Environment:
Housing vouchers:
Administration526,004507,04118,963
4,159,1764,238,686(79,510)
Assistance payments
4,685,1804,745,727(60,547)
Total expenditures
(86,997)(702,776)(615,779)
Revenues over (under) expenditures
Other Financing Sources (Uses):
86,99786,997-
Transfers in (out)
86,99786,997-
Total other financing sources (uses)
$ -$ (615,779)
Net change in fund balance(615,779)
Fund Balance:
1,184,195
Beginning of year - July 1
$ 568,416
End of year - June 30
95
Schedule D-6
ORANGE COUNTY, NORTH CAROLINA
GRANT SUPPORTED PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Health grants$ 158,400$ 133,177$ (25,223)
Aging54,00055,1891,189
Sheriff171,735188,94017,205
Charges for services62,00035,917(26,083)
Asset management84,53063,575(20,955)
16,50015(16,485)
Miscellaneous revenues
547,165476,813(70,352)
Total revenues
Expenditures:
Human Services:
Asset Management:
Operating84,53063,57520,955
Health:
Personnel services37,23024,91512,315
Operating57,57747,28710,290
Aging:
Personnel services124,239103,90920,330
Operating105,16689,79015,376
EMS:
Personnel services53,19553,953(758)
163,650164,598(948)
Operating
625,587548,02777,560
Total expenditures
(78,422)(71,214)7,208
Revenues over (under) expenditures
Other Financing Sources (Uses):
Transfer in71,21471,214-
7,208-(7,208)
Appropriated fund balance
78,42271,214(7,208)
Total other financing sources (uses)
$ -$ -
Net change in fund balance-
Fund Balance:
111,146
Beginning of year - July 1
$ 111,146
End of year - June 30
96
Schedule D-7
Page 1 of 2
ORANGE COUNTY, NORTH CAROLINA
GRANTS PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FROM INCEPTION AND FOR THE YEAR ENDED JUNE 30, 2012
Actual
BudgetReported inCurrentTotal
to DatePrior YearYearto Date
Revenues:
Social Services grants$ 1,306,097$ 866,172$ 335,178$ 1,201,350
Health grants2,844,9362,181,22526,4032,207,628
Cooperative extension361,971112,59370,002182,595
Aging473,526(363)-(363)
Emergency management grants2,915,9881,406,31639,5731,445,889
Sheriff3,015,3472,844,10828,3462,872,454
Planning633,049447,485121,050568,535
96,58414,971-14,971
Library
11,647,4987,872,507620,5528,493,059
Total revenues
Expenditures:
Community and Environment:
Operating-50,873-50,873
Social Services:
Personnel services416,997178,06660,366238,432
Operating812,804552,066225,016777,082
Health:
Personnel services1,961,4551,544,58425,2291,569,813
Operating1,241,914566,09152,055618,146
Cooperative extension:
Personnel services143,669162,470-162,470
Operating218,30297,04941,654138,703
Aging:
Personnel services239,327---
Operating234,19917,806-17,806
EMS:
Personnel services-87,782-87,782
Operating3,254,2783,243,7529013,244,653
Sheriff:
Personnel services2,148,067209,729-209,729
Operating1,373,8591,002,83929,7051,032,544
Planning:
Personnel services471,952245,29760,175305,472
Operating571,024356,5019,911366,412
Library:
15,11315,099-15,099
Operating
13,102,9608,330,004505,0128,835,016
Total expenditures
97
Schedule D-7
Page 2 of 2
ORANGE COUNTY, NORTH CAROLINA
GRANTS PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FROM INCEPTION AND FOR THE YEAR ENDED JUNE 30, 2012
Actual
BudgetReported inCurrentTotal
to DatePrior YearYearto Date
(1,455,462)(457,497)115,540(341,957)
Revenues over (under) expenditures
Other Financing Sources (Uses):
Transfers to General Fund(76,297)(24,917)-(24,917)
1,531,7591,048,218-1,048,218
Transfers in
1,455,4621,023,301-1,023,301
Total other financing sources (uses)
$ -$ 565,804$ 681,344
Net change in fund balance115,540
Fund Balance:
565,804
Beginning of year - July 1
$ 681,344
End of year - June 30
98
Schedule D-8
ORANGE COUNTY, NORTH CAROLINA
EMERGENCY TELEPHONE SYSTEM FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Investment earnings$ -$ 334$ 334
455,396554,78799,391
Subscriber fees
455,396555,12199,725
Total revenues
Expenditures:
Personnel services136,940137,074(134)
Operations342,786275,04967,737
115,83193,80722,024
Capital outlay
595,557505,93089,627
Total expenditures
(140,161)49,19110,098
Revenues over (under) expenditures
Other Financing Sources (Uses):
140,161-(140,161)
Appropriated fund balance
140,161-(140,161)
Total other financing sources (uses)
$ -$ 49,191
Net change in fund balance49,191
Fund Balance:
503,626
Beginning of year - July 1
$ 552,817
End of year - June 30
99
Schedule D-9
ORANGE COUNTY, NORTH CAROLINA
VISITORS' BUREAU FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Occupancy tax$ 841,598$ 1,038,383$ 196,785
State Arts Grant29,89129,891-
Investment earnings2,000790(1,210)
151,000150,587(413)
Other
1,024,4891,219,651195,162
Total revenues
Expenditures:
Community and environment
Operations720,303710,7359,568
380,899384,764(3,865)
Personnel services
1,101,2021,095,4995,703
Total expenditures
(76,713)124,152200,865
Revenues over (under) expenditures
Other Financing Sources (Uses):
76,713-(76,713)
Appropriated fund balance
76,713-(76,713)
Total other financing sources (uses)
$ -$ 124,152
Net change in fund balance124,152
Fund Balance:
452,602
Beginning of year - July 1
$ 576,754
End of year - June 30
100
Schedule D-10
ORANGE COUNTY, NORTH CAROLINA
LOCAL FIRE DISTRICTS FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Property taxes, current$ 3,460,956$ 3,562,625$ 101,669
Property taxes, delinquent39,00555,06316,058
NCDOT Grant25,000-(25,000)
1,651369(1,282)
Investment earnings
3,526,6123,618,05791,445
Total revenues
Expenditures:
Public Safety:
3,606,8013,581,80125,000
Remittance to fire districts
3,606,8013,581,80125,000
Total expenditures
Revenues over (under) expenditures(80,189)36,256116,445
Other Financing Sources (Uses):
80,189-(80,189)
Appropriated fund balance
$ -$ 36,256
Net change in fund balance36,256
Fund Balance:
436,239
Beginning of year - July 1
$ 472,495
End of year - June 30
101
Schedule D-11
ORANGE COUNTY, NORTH CAROLINA
HEUSNER FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
$ -$ 6
Investment earnings$ 6
Fund Balance:
9,144
Beginning of year - July 1
$ 9,150
End of year - June 30
102
Schedule D-12
ORANGE COUNTY, NORTH CAROLINA
LIBRARY DEVELOPMENT FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
$ -$ 125
$ 125
Investment earnings
$ -$ 125
Net change in fund balance125
Fund Balance:
138,880
Beginning of year - July 1
$ 139,005
End of year - June 30
103
Schedule D-13
ORANGE COUNTY, NORTH CAROLINA
ADOPTION ENHANCEMENT FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - BUDGET AND ACTUAL
FROM INCEPTION AND FOR THE YEAR ENDED JUNE 30, 2012
Actual
BudgetReported inCurrentTotal
to DatePrior YearYearto Date
Revenues:
Investment earnings$ -$ 17,141$ 40$ 17,181
452,060430,10622,376452,482
Charges for services
452,060447,24722,416469,663
Total revenues
Expenditures:
529,005462,91222,586485,498
Adoption enhancement
529,005462,91222,586485,498
Total expenditures
Revenues over (under) expenditures(76,945)(15,665)(170)(15,835)
Other Financing Sources (Uses):
76,94576,945-76,945
Transfers from other funds
$ -$ 61,280$ 61,110
Net change in fund balance(170)
Fund Balance:
61,280
Beginning of year - July 1
$ 61,110
End of year - June 30
104
Schedule D-14
ORANGE COUNTY, NORTH CAROLINA
RECREATION SUBDIVISION FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Investment earnings$ -$ 299$ 299
-6,6786,678
Subdivision payments
-6,9776,977
Total revenues
$ -$ 6,977
Net change in fund balance6,977
Fund Balance:
464,536
Beginning of year - July 1
$ 471,513
End of year - June 30
105
Schedule D-15
ORANGE COUNTY, NORTH CAROLINA
ARTICLE 46 SALES TAX
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Article 46 Sales Tax$ 625,000$ 709,663$ 84,663
-100,000100,000
Miscellaneous Revenue
625,000809,663184,663
Total revenues
Expenditures:
Community and Environment
Economic Development312,500120,000192,500
Education:
Renovation - Chapel Hill Carrboro Schools95,000-95,000
Technology - Chapel Hill Carrboro Schools
95,625-95,625
121,875-121,875
Technology - Chapel Hill Orange County Schools
625,000120,000505,000
Total expenditures
$ -$ 689,663
Net change in fund balance689,663
Fund Balance:
-
Beginning of year - July 1
$ 689,663
End of year - June 30
106
Schedule D-16
ORANGE COUNTY, NORTH CAROLINA
PIEDMONT FOOD AND AGRICULTURAL PROCESSING CENTER
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Investment earnings$ -$ 25$ 25
Grants57,14457,144-
47,90042,449(5,451)
Charges for services
105,04499,618(5,426)
Total revenues
Expenditures:
Community and Environment:
Personnel services63,63561,7111,924
Operations
36,06929,4836,586
5,3408,424(3,084)
Capital outlay
105,04499,6185,426
Total expenditures
$ -$ -
Net change in fund balance-
Fund Balance:
-
Beginning of year - July 1
$ -
End of year - June 30
107
Schedule D-17
ORANGE COUNTY, NORTH CAROLINA
SPAY NEUTER FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Investment earnings$ -$ 59$ 59
Animal tax27,00032,3425,342
Donations1,0003,9702,970
10,00031,43421,434
Miscellaneous revenues
38,00067,80529,805
Total revenues
Expenditures:
Community and Environment:
Personnel Services1,9382,095(157)
44,84642,1462,700
Operations
46,78444,2412,543
Total expenditures
(8,784)23,56432,348
Revenues over (under) expenditures
Other Financing Sources (Uses):
8,784-(8,784)
Appropriated fund balance
8,784-(8,784)
Total other financing sources (uses)
$ -$ 23,564
Net change in fund balance23,564
Fund Balance:
75,339
Beginning of year - July 1
$ 98,903
End of year - June 30
108
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Enterprise Funds
The Enterprise Funds are used to account for operations that are intended to be self supporting through
charges made to users of the services provided or where the determination of net income is an important
factor.
Major Enterprise Funds
Solid Waste Landfill Fund accounts for revenues and expenses related to the provision of solid waste
-
disposal and recycling activities for the citizens of Orange County.
SportsPlex Fund accounts for revenues and expenses related to the operation of the Triangle
-
SportsPlex.
Nonmajor Enterprise Fund
Efland Sewer Enterprise Fund - accounts for revenues and expenses related to the Provision of sewer
service. The financial statements that follow present the two main Activities of this fund-operations and
construction separately in detailed schedules.
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Schedule E-1
ORANGE COUNTY, NORTH CAROLINA
SOLID WASTE LANDFILL FUND
SCHEDULE OF REVENUES AND EXPENDITURES -
BUDGET AND ACTUAL (NON-GAAP)
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
Landfill fees$ 2,894,060$ 2,804,460$ (89,600)
Sanitation fees383,843380,777(3,066)
Recycling4,753,2644,910,192156,928
Mulch sales105,000140,65835,658
Grants - State425,590419,354(6,236)
Other10,000110,055100,055
Investment earnings
20,00010,001(9,999)
6,500-(6,500)
Gain on disposal of fixed assets
8,598,2578,775,497177,240
Total revenues
Expenditures:
Administration1,762,7221,737,45525,267
Landfill3,978,5081,905,0482,073,460
Recycling3,199,2283,364,811(165,583)
4,568,3051,302,6583,265,647
Contract services
13,508,7638,309,9725,198,791
Total expenditures
(4,910,506)465,5255,376,031
Revenues over (under) expenditures
Other Financing Sources (Uses):
Debt service, proceeds3,000,0003,000,000-
Debt service - principal(732,706)(527,698)205,008
Debt service - interest-(26,936)(26,936)
Transfers in1,989,5661,617,852(371,714)
Capital contributions(756,747)-756,747
1,410,393-(1,410,393)
Appropriated fund balance
4,910,5064,063,218(847,288)
Total other financing sources (uses)
Revenues and other financing sources over
$ -$ 4,528,743$ 4,528,743
(under) expenditures and other financing sources
Reconciliation of Modified Accrual Basis to Full Accrual Basis:
Revenues and other financing sources over
(under) expenditures and other financing uses$ 4,528,743
Reconciling items:
Depreciation(786,278)
Post-closing cost(1,755,866)
OPEB(244,612)
Capital outlay571,244
Debt service - principal
527,698
Debt service - proceeds(3,000,000)
$ (159,071)
Change in net assets
109
Schedule E-2
ORANGE COUNTY, NORTH CAROLINA
SPORTSPLEX FUND
SCHEDULE OF REVENUES AND EXPENDITURES -
BUDGET AND ACTUAL (NON-GAAP)
FOR THE YEAR ENDED JUNE 30, 2012
Variance
BudgetActualOver/Under
Revenues:
$ 2,541,050$ 2,785,702$ (244,652)
Service fees
2,541,0502,785,702(244,652)
Total revenues
Expenditures:
2,952,0502,432,792519,258
Operations
.
(411,000)352,910(763,910)
Revenues over (under) expenditures
Other Financing Sources (Uses):
Debt service, principal(649,279)(376,367)(272,912)
Debt service, interest-(217,318)217,318
Transfers in649,279649,279-
411,000-411,000
Appropriated fund balance
411,00055,594355,406
Total other financing sources (uses)
Revenues and other financing sources over
$ -$ 408,504$ 408,504
(under) expenditures and other financing sources
Reconciliation of Modified Accrual Basis to Full Accrual Basis:
SportsPlex Operating Fund:
Revenues and other financing sources over
(under) expenditures and other financing uses$ 408,504
Reconciling items:
Depreciation expense(259,010)
376,367
Debt service
117,357
Total reconciling items
$ 525,861
Change in net assets
110
Schedule E-3
ORANGE COUNTY, NORTH CAROLINA
EFLAND SEWER OPERATING FUND
SCHEDULE OF REVENUES AND EXPENDITURES -
BUDGET AND ACTUAL (NON-GAAP)
FOR THE YEAR ENDED JUNE 30, 2012
Actual
Variance
BudgetActualOver/Under
Revenues:
Service fees$ 142,000$ 146,202$ 4,202
-6666
Interest on investments
142,000146,2684,268
Total revenues
Expenditures:
Operations
185,200184,850(350)
45,30044,700(600)
Repairs and maintenance
Total expenditures230,500229,550(950)
Revenues over (under) expenditures(88,500)(83,282)5,218
Other Financing Sources (Uses):
88,50088,500-
Transfers in
88,50088,500-
Total other financing sources (uses)
Revenues and other financing sources over
$ -$ 5,218$ 5,218
(under) expenditures and other financing sources
Reconciliation of Modified Accrual Basis to Full Accrual Basis:
Efland Sewer Operating Fund:
Revenues and other financing sources over
(under) expenditures and other financing uses$ 5,218
Reconciling items:
(87,134)
Depreciation expense
Change in net assets$ (81,916)
111
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Internal Service Funds
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Schedule F-1
ORANGE COUNTY, NORTH CAROLINA
DENTAL INSURANCE FUND
SCHEDULE OF REVENUES AND EXPENDITURES -
FINANCIAL PLAN AND ACTUAL (NON-GAAP)
FOR THE YEAR ENDED JUNE 30, 2012
FinancialVariance
PlanActualOver/Under
Operating Revenues:
$ 370,000$ 362,899$ (7,101)
Employee contributions
Operating Expenditures:
General and administrative30,00028,2101,790
Claims expense
450,000438,65211,348
10,00010,000-
Contract services
490,000476,86213,138
Total operating expenditures
.
(120,000)(113,963)6,037
Operating income (loss)
Non-Operating Revenues:
-140140
Investment earnings
Other Financing Sources (Uses):
Transfers in (out)10,00010,000-
110,000-(110,000)
Appropriated fund balance
120,00010,000(110,000)
Total other financing sources (uses)
$ -$ (103,823)
Change in net assets(103,823)
Net Assets:
278,831
Beginning of year - July 1
$ 175,008
End of year - June 30
112
Schedule F-2
ORANGE COUNTY, NORTH CAROLINA
OPC RETIREE HEALTH INSURANCE FUND
SCHEDULE OF REVENUES AND EXPENDITURES -
FINANCIAL PLAN AND ACTUAL (NON-GAAP)
FOR THE YEAR ENDED JUNE 30, 2012
FinancialVariance
PlanActualOver/Under
Operating Revenues:
$ 520,000$ 510,006$ (9,994)
Employee contributions
Operating Expenditures:
520,000-520,000
Premium expense
520,000-520,000
Total operating expenditures
.
$ -$ 510,006
Change in net assets510,006
Net Assets:
-
Beginning of year - July 1
$ 510,006
End of year - June 30
113
Agency Funds
ORANGE COUNTY, NORTH CAROLINA
AGENCY FUNDS
COMBINING STATEMENT OF FIDUCIARY ASSETS AND LIABILITIES
JUNE 30, 2012
CooperativeHyconeechee
SchoolJail InmateExtensionRegional
DistrictTrust4-HLibrary
Assets:
Cash and investments$ 59,573$ 98,181$ 72,346$ -
Accounts receivable, property taxes201,497---
---7,259
Accounts receivable, other
$ 261,070$ 98,181$ 72,346$ 7,259
Total assets
Liabilities:
Accounts payable and accrued liabilities$ 261,070$ 98,181$ 4,537$ 7,259
--67,809-
Due to cooperative extension
$ 261,070$ 98,181$ 72,346$ 7,259
Total liabilities
114
Schedule G-1
American
StoneRegister of
No FaultCommunicationMotorDSSDeeds Trust
Well RepairTower TrustVehicle TaxTrustFeeTotals
$ 121,093$ 2,118$ 5,052$ 98,219$ 11,148$ 467,730
-----201,497
-----7,259
$ 121,093$ 2,118$ 5,052$ 98,219$ 11,148$ 676,486
$ 121,093$ 2,118$ 5,052$ 98,219$ 11,148$ 608,677
-----67,809
$ 121,093$ 2,118$ 5,052$ 98,219$ 11,148$ 676,486
115
Schedule G-2
Page 1 of 2
ORANGE COUNTY, NORTH CAROLINA
AGENCY FUNDS
COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FOR THE YEAR ENDED JUNE 30, 2012
BalanceBalance
July 1, 2011AdditionsDeductionsJune 30, 2012
School District Fund
Assets:
Cash and investments$ 78,848$ 19,521,218$ 19,540,493$ 59,573
271,87719,450,83919,521,219201,497
Accounts receivable, property taxes
$ 350,725$ 38,972,057$ 39,061,712$ 261,070
Total assets
Liabilities:
$ 350,725$ 38,972,057$ 39,061,712$ 261,070
Accounts payable
Jail Inmate Fund
Assets:
$ 94,607$ 277,116$ 273,542$ 98,181
Cash and investments
Liabilities:
$ 94,607$ 277,116$ 273,542$ 98,181
Accounts payable
Cooperative Extension 4-H Fund
Assets:
$ 67,001$ 108,724$ 103,379$ 72,346
Cash and investments
Liabilities:
Accounts payable$ 3,983$ 30,383$ 29,829$ 4,537
63,01878,34173,55067,809
Due to cooperative extension
$ 67,001$ 108,724$ 103,379$ 72,346
Total assets
Hyconeechee Regional Library Fund
Assets:
Cash and investments$ 3,374$ 468,129$ 471,503$ -
2,7627,2592,7627,259
Accounts receivable, other
$ 6,136$ 475,388$ 474,265$ 7,259
Total assets
Liabilities:
Accounts payable$ 6,136$ 475,388$ 474,265$ 7,259
$ 6,136$ 475,388$ 474,265$ 7,259
Total assets
American Stone No Fault Well Repair
Assets:
$ 120,598$ 15,078$ 14,583$ 121,093
Cash and investments
Liabilities:
$ 120,598$ 15,078$ 14,583$ 121,093
Accounts payable
116
Schedule G-2
Page 2 of 2
ORANGE COUNTY, NORTH CAROLINA
AGENCY FUNDS
COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FOR THE YEAR ENDED JUNE 30, 2012
BalanceBalance
July 1, 2011AdditionsDeductionsJune 30, 2012
Communication Tower Trust Fund
Assets:
$ 6,612$ 722$ 5,216$ 2,118
Cash and investments
Liabilities:
$ 6,612$ 722$ 5,216$ 2,118
Accounts payable
Motor Vehicle Tax
Assets:
$ 6,821$ 77,402$ 79,171$ 5,052
Cash and investments
Liabilities:
$ 6,821$ 77,402$ 79,171$ 5,052
Accounts payable
DSS Trust Fund
Assets:
Cash and investments$ 98,513$ 402,958$ 403,252$ 98,219
Liabilities:
$ 98,513$ 402,958$ 403,252$ 98,219
Accounts payable
Register of Deeds Trust Fee
Assets:
Cash and investments$ 2,220$ 127,664$ 118,736$ 11,148
Liabilities:
$ 2,220$ 127,664$ 118,736$ 11,148
Accounts payable
Totals - All Agency Funds
Assets:
Cash and investments$ 478,594$ 20,999,011$ 21,009,875$ 467,730
Accounts receivable - property taxes271,87719,450,83919,521,219201,497
2,7627,2592,7627,259
Accounts receivable - other
$ 753,233$ 40,457,109$ 40,533,856$ 676,486
Total assets
Liabilities:
Accounts payable$ 690,215$ 40,378,768$ 40,460,306$ 608,677
63,01878,34173,55067,809
Due to cooperative extension
$ 753,233$ 40,457,109$ 40,533,856$ 676,486
Total liabilities
117
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Supplemental Financial Data
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Schedule H-1
ORANGE COUNTY, NORTH CAROLINA
SCHEDULE OF AD VALOREM TAXES RECEIVABLE
GENERAL FUND
JUNE 30, 2012
UncollectedUncollected
BalanceCollectionsBalance
Fiscal YearJuly 1, 2011Additionsand CreditsJune 30, 2012
2011-2012$ -$ 136,779,611$ 134,715,752$ 2,063,859
2010-20111,962,722-1,342,460620,262
2009-2010554,774-245,761309,013
1,032,576-121,152911,424
2008-2009
$ 3,550,072$ 136,779,611$ 136,425,1253,904,558
Total
(1,084,392)
Less: Allowance for uncollectible accounts
$ 2,820,166
Ad valorem taxes receivable, net
Reconciliation with Revenues:
Taxes - Ad Valorem - General Fund$ 135,873,089
Reconciling items:
Interest and penalties552,036
$ 136,425,125
Total collections and credits
118
Schedule H-2
ORANGE COUNTY, NORTH CAROLINA
ANALYSIS OF CURRENT TAX LEVY
COUNTY-WIDE LEVY
FOR THE YEAR ENDED JUNE 30, 2012
Total Levy
Property
TotalExcludingRegistered
PropertyRateAdjustedRegisteredMotor
Valuation**Per $100Levy*Motor VehiclesVehicles
Original Levy:
Property taxed at current year's rate$15,617,126,791$ 0.00858$ 133,994,948$ 128,998,003$ 4,996,945
Motor vehicles taxed at prior year rate318,159,0900.008582,729,805-2,729,805
Late list penalties5,330,30345,73445,734-
-9,1249,124-
Lien advertisement
15,940,616,184
Total136,779,611129,052,8617,726,750
2,063,8591,331,634732,225
Uncollected taxes at June 30, 2012
Current Year's Taxes Collected
$ 134,715,752$ 127,721,227$ 6,994,525
Current Levy Collection Percentage
98.49%98.97%90.52%
* Total adjusted levy includes discoveries and abatements.
**Property tax valuation prior to the discoveries and abatements
119
Statistical Section
The information presented in this section is provided for additional analytical purposes
and reflects certain social and economic data, as well as financial trends and other fiscal
information.
Financial Trends:
These schedules contain trend information to help the reader
understand how the government's financial performance and well-being have changed
over time.
Revenue Capacity:
These schedules contain information to help the reader assess the
government's most significant local revenue source, the property tax.
Debt Capacity:
These schedules present information to help the reader assess the
affordability of the government's current levels of outstanding debt and the government's
ability to issue additional debt in the future.
Demographic and Economic Information:
These schedules offer demographic and
economic indicators to help the reader understand the environment within which the
government's financial activities take place.
Operating Information:
These schedules contain service and infrastructure data to help
the reader understand how the information in the government's financial report relates
to the services the government provides and the activities it performs.
Sources:
Unless otherwise noted, the information in these schedules is derived from the
comprehensive annual financial report for the relevant year.
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120
121
122
123
124
125
126
127
128
129
130
131
Table 12
ORANGE COUNTY, NORTH CAROLINA
Direct and Overlapping Governmental Activities Debt
(Unaudited)
As of June 30, 2012
EstimatedEstimated Share
DebtPercentageof Direct and
Governmental UnitOutstandingApplicableOverlapping Debt
Municipalities:
$ 31,445,000100%$ 31,445,000.00
Town of Chapel Hill
10,444,941100%10,444,941
Town of Hillsborough
8,140,128100%8,140,128
Town of Carrboro
401,385,0003%12,041,550
City of Durham
9,357,14930%2,807,145
Town of Mebane
225,109,130
Total direct debt
$ 289,987,894
Total direct and overlapping debt
Source: Finance Officers of above listed municipalities.
132
133
Table 14
ORANGE COUNTY, NORTH CAROLINA
Principal Employers
Current Year and Ten Years Ago
(Unaudited)
20122003
Percentage ofPercentage of
Total CountyTotal County
EmployerEmployeesRankEmploymentEmployeesRankEmployment
1
UNC-Chapel Hill15,78523.70%16,600126.58%
2
UNC Hospitals8,67513.02%6,819210.92%
3
Chapel Hill-Carrboro City Schools2,2093.31%2,61834.19%
4
Orange County Schools1,0191.53%1,25352.06%
5
Town of Chapel Hill8801.32%76861.23%
6
Orange County Government8581.28%74071.18%
7
Blue Cross/Blue Shield7881.18%1,37542.20%
8
Harris Teeter, Inc.4930.74%52290.83%
9
Aramark Services4440.66%
10
A Southern Season4410.66%
General Electric Corp.52580.84%
Sports Endeavers, Inc.434100.69%
Source: Orange County Economic Development Commission, Employment Security Commission
134
135
136
Table 17
ORANGE COUNTY, NORTH CAROLINA
Capital Asset Statistics By Function
Last Five Fiscal Years
(Unaudited)
For Year Ended June 30
Function/Program2012
2008200920102011
Human Services:
33,638
Public health occupied square footage18,40018,40018,40018,400
59,825
Social services occupied square footage24,58424,58427,59560,181
4,986
Cooperative extension occupied square footage4,9864,9864,9864,986
13
Number of centers12131313
Public Safety:
137
Number of law enforcement vehicles118111125129
28
Number of emergency services vehicles42383833
6
Number of animal control vehicles8888
129
Detention capacity129129129129
Cultural and Recreational:
3
Libraries - branches4453
113,978
Volume of library books253,484278,488271,066195,282
Education:
29
Number of schools29292929
Source: Orange County Finance Department and Orange County School Systems
137
Compliance Section
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Report On Internal Control Over Financial Reporting And On Compliance And Other
Matters Based On An Audit of Financial Statements Performed In Accordance
With
Government Auditing Standards
To the Board of Commissioners
Orange County, North Carolina
We have audited the accompanying financial statements of the governmental activities, the business-type
activities, the discretely presented component unit, each major fund, and the aggregate remaining fund
information of Orange County, North Carolina, as of and for the year ended June 30, 2012, which
collectively comprises and have issued our report thereon dated
November 20, 2012.Our report includes a reference to other auditors. 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. Other auditors audited the financial statements of the Orange County ABC
The financial statements of the
Orange County ABC Board were not audited in accordance with Government Auditing Standards.
Internal Control Over Financial Reporting
Management of Orange County is responsible for establishing and maintaining effective internal control
over financial reporting. In planning and performing our audit, we considered Orange County
control over financial reporting as a basis for designing our auditing procedures for the purpose of
expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on
the effectiveness of Orange County Accordingly, we do not
express an opinion on the effectiveness of Orange County
Adeficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct, misstatements on a timely basis. Amaterial weakness is a deficiency, or a
combination of deficiencies, in internal control, such that there is a reasonable possibility that a material
, on a
timely basis.
Our consideration of internal control over financial reporting was for the limited purpose described in the
first paragraph of this section and was not designed to identify all deficiencies in internal control over
financial reporting that might be deficiencies, significant deficiencies, or material weaknesses. We did
not identify any deficiencies in internal control over financial reporting that we consider to be material
weaknesses, as defined above.
730 13th Avenue Drive SE Hickory, North Carolina 28602 Phone 828-327-2727 Fax 828-328-2324
13 South Center Street Taylorsville, North Carolina 28681 Phone 828-632-9025 Fax 828-632-9085
Toll Free Both Locations 1-800-948-0585Website: www.martinstarnes.com
138
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Orange County
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements, non-compliance with which could have a direct and material effect on
the determination of financial statement amounts. However, providing an opinion on compliance with
those provisions was not an objective of our audit and; accordingly, we do not express such an opinion.
The results of our tests disclosed no instances of non-compliance or other matters that are required to be
reported under Government Auditing Standards.
This report is intended solely for the information and use of management, others within the organization,
members of the Board of Commissioners, federal and State awarding agencies, and pass-through entities,
and is not intended to be, and should not be, used by anyone other than these specified parties.
Martin Starnes & Associates, CPAs, P.A.
November 20, 2012
139
Report On Compliance With Requirements That Could Have A Direct And Material Effect On
Each Major Federal Program And On Internal Control Over Compliance In Accordance With
OMB Circular A-133 And The State Single Audit Implementation Act
Independent Auditors' Report
To the Board of Commissioners
Orange County, North Carolina
Compliance
We have audited Orange County with the types of compliance requirements described in the
U.S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement and the Audit
Manual for Governmental Auditors in North Carolina, issued by the Local Government Commission, that
could have a direct and material effect on each of Orange County
ended June 30, 2012. Orange Countyified in the summary of auditors'
results section of the accompanying Schedule of Findings and Questioned Costs. Compliance with the
requirements of laws, regulations, contracts, and grants applicable to each of its major federal programs is
the responsibility of Orange County Our responsibility is to express an opinion on
Orange County
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America; the standards applicable to financial audits contained in Government Auditing
Standards issued by the Comptroller General of the United States; OMB Circular A-133, Audits of States,
Local Governments, and Non-Profit Organizations, and the State Single Audit Implementation Act.
Those standards, OMB Circular A-133, and the State Single Audit Implementation Act require that we
plan and perform the audit to obtain reasonable assurance about whether non-compliance with the types
of compliance requirements referred to above that could have a direct and material effect on a major
federal program occurred. An audit includes examining, on a test basis, evidence about Orange County
compliance with those requirements and performing such other procedures as we considered necessary in
the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does
not provide a legal determination of Orange County compliance with those requirements.
In our opinion, Orange County complied, in all material respects, with the compliance requirements
referred to above that could have a direct and material effect on each of its major federal programs for the
year ended June 30, 2012.
730 13th Avenue Drive SE Hickory, North Carolina 28602 Phone 828-327-2727 Fax 828-328-2324
13 South Center Street Taylorsville, North Carolina 28681 Phone 828-632-9025 Fax 828-632-9085
Toll Free Both Locations 1-800-948-0585Website: www.martinstarnes.com
140
Internal Control Over Compliance
The management of Orange County is responsible for establishing and maintaining effective internal
control over compliance with the requirements of laws, regulations, contracts, and grants applicable to
federal programs. In planning and performing our audit, we considered Orange County
over compliance with the requirements that could have a direct and material effect on a major federal
program in order to determine our auditing procedures for the purpose of expressing our opinion on
compliance and to test and report on internal control over compliance in accordance with OMB Circular
A-133, but not for the purpose of expressing an opinion on the effectiveness of internal control over
compliance. Accordingly, we do not express an opinion on the effectiveness of Orange County
control over compliance.
Adeficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, non-compliance with a type of compliance requirement of a
federal program on a timely basis. A material weakness in internal control over compliance is a
deficiency, or combination of deficiencies, in internal control over compliance, such that there is a
reasonable possibility that material non-compliance with a type of compliance requirement of a federal
program will not be prevented, or detected and corrected, on a timely basis.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over
compliance that might be deficiencies, significant deficiencies, or material weaknesses. We did not
identify any deficiencies in internal control over compliance that we consider to be material weaknesses,
as defined above.
This report is intended solely for the information and use of management, others within the organization,
members of the Board of Commissioners, federal and State awarding agencies, and pass-through entities,
and is not intended to be, and should not be, used by anyone other than these specified parties.
Martin Starnes & Associates, CPAs, P.A.
November 20, 2012
141
Report On Compliance With Requirements That Could Have A Direct And Material Effect On
Each Major State Program AndOn Internal Control Over Compliance In Accordance With
Applicable Sections Of OMB Circular A-133 And The State Single Audit Implementation Act
Independent Auditors' Report
To the Board of Commissioners
Orange County, North Carolina
Compliance
We have audited Orange County with the types of compliance requirements described in
applicable sections of OMB Circular A-133 and the Audit Manual for Governmental Auditors in North
Carolina, issued by the Local Government Commission that could have a direct and material effect on
each of Orange CountyState programs for the year ended June 30, 2012. Orange County
State programs are identified in the summary of auditors' results section of the accompanying Schedule of
Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts, and
grants applicable to each of its major State programs is the responsibility of Orange County
management. Our responsibility is to express an opinion on Orange County compliance based on our
audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America; the standards applicable to financial audits contained in Government Auditing
Standards issued by the Comptroller General of the United States; applicable sections of OMB Circular
A-133, Audits of State, Local Governments, and Non-Profit Organizations, and the State Single Audit
Implementation Act. Those standards, applicable sections of OMB Circular A-133, and the State Single
Audit Implementation Act require that we plan and perform the audit to obtain reasonable assurance
about whether non-compliance with the types of compliance requirements referred to above that could
have a direct and material effect on a major State program occurred. An audit includes examining, on a
test basis, evidence aboutOrange County compliance with those requirements and performing such
other procedures as we considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion. Our audit does not provide a legal determination of Orange County
compliance with those requirements.
In our opinion, Orange County complied, in all material respects, with the compliance requirements
referred to above that could have a direct and material effect on each of its major State programs for the
year ended June 30, 2012.
730 13th Avenue Drive SE Hickory, North Carolina 28602 Phone 828-327-2727 Fax 828-328-2324
13 South Center Street Taylorsville, North Carolina 28681 Phone 828-632-9025 Fax 828-632-9085
Toll Free Both Locations 1-800-948-0585Website: www.martinstarnes.com
142
Internal Control Over Compliance
The management of Orange County is responsible for establishing and maintaining effective internal
control over compliance with the requirements of laws, regulations, contracts, and grants applicable to
State programs. In planning and performing our audit, we considered Orange County
over compliance with the requirements that could have a direct and material effect on a major State
program in order to determine our auditing procedures for the purpose of expressing our opinion on
compliance and to test and report on internal control over compliance in accordance with applicable
sections of OMB Circular A-133 and the State Single Audit Implementation Act, but not for the purpose
of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do
not express an opinion on the effectiveness of Orange County over compliance.
Adeficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, non-compliance with a type of compliance requirement of a
State program on a timely basis. Amaterial weakness in internal control over compliance is a deficiency,
or combination of deficiencies, in internal control over compliance, such that there is a reasonable
possibility that material non-compliance with a type of compliance requirement of a State program will
not be prevented, or detected and corrected, on a timely basis.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over
compliance that might be deficiencies, significant deficiencies, or material weaknesses. We did not
identify any deficiencies in internal control over compliance that we consider to be material weaknesses,
as defined above.
This report is intended solely for the information and use of management, others within the organization,
members of the Board of Commissioners, federal and State awarding agencies, and pass-through entities,
and is not intended to be, and should not be, used by anyone other than these specified parties.
Martin Starnes & Associates, CPAs, P.A.
November 20, 2012
143
ORANGE COUNTY, NORTH CAROLINA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2012
1.
Financial Statements
Unqualified
Internal control over financial reporting:
Material weaknesses identified? Yes X No
Significant deficiencies identified? Yes X No
Non-compliance material to financial
statements noted? Yes X No
Federal Awards
Internal control over major federal
programs:
Material weaknesses identified? Yes X No
Significant deficiencies identified? Yes X No
compliance for major federal programs: Unqualified
Any audit findings disclosed that are
required to be reported in accordance with
Section 510(a) of Circular A-133? Yes X No
144
ORANGE COUNTY, NORTH CAROLINA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2012
1.
Identification of major federal programs:
Program Name CFDA#
Medicaid Cluster 93.778, 93.720, 93.775, 93.777
Temporary Assistance For Needy Families Cluster 93.558, 93.714, 93.716
Childcare Development Fund Cluster 93.575, 93.596
Housing Voucher Cluster 14.871
Children's Heath Insurance Program 93.767
Adoption Assistance 93.659
Dollar threshold used to distinguish
between Type A and Type B Programs: $2,614,120
Auditee qualified as low-risk auditee? Yes X No
State Awards
Internal control over major State programs:
Material weaknesses identified? Yes X No
Significant deficiencies identified? Yes X No
compliance for major State programs Unqualified
Any findings disclosed that are required to
be reported in accordance with the State
Single Audit Implementation Act? Yes X No
Identification of major State programs:
Medicaid Cluster
Subsidized Childcare Cluster
Public School Capital Building Fund-Lottery Proceeds
Foster Care & Adoption Cluster
145
ORANGE COUNTY, NORTH CAROLINA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2012
2.Findings Related to the Audit of the Basic Financial Statements
None
3.Findings and Questioned Costs Related to the Audit of Federal Awards
None
4.Findings and Questioned Costs Related to the Audit of State Awards
None
146
ORANGE COUNTY, NORTH CAROLINA
SUMMARY SCHEDULE OF PRIOR YEAR'S AUDIT FINDINGS
FOR THE YEAR ENDED JUNE 30, 2012
2011-01:
Corrected.
147
Orange County, NC
Schedule of Expenditures of Federal and State Awards
Year Ended June 30, 2012
CFDA Number/ Grant
NumberFederal ExpendituresState ExpendituresLocal Expenditures
Federal Grantor/Program Title
Federal Awards:
U. S. Department of Agriculture:
Direct Program:
Passed-Through N. C. Department of Health and Human Services:
Division of Public Health:
Special Supplemental Nutrition Program for Women, Infants, & Children (WIC)$ -1,141,288$ -$
10.557
Division of Social Services:
Supplemental Nutrition Assistance Program Cluster:
SNAP Administration -875,621875,621
10.561
SNAP Fraud Admin42,394 -42,394
10.561
Total Supplemental Nutrition Assistance Program Cluster918,014 - 918,014
Total U. S. Department of Agriculture
-2,059,302 918,014
U. S. Department of Housing and Urban Development:
Direct Programs:
Lower Income Housing Assistance:
Home Investment Partnership Program --261,018
14.239
Cooperative Fair Housing Assistance Program --17,524
14.401
Indian CDBG Program Cluster:
Single Family Housing Rehabilitation Grant - Indian CDBG Program61,219 - -
14.862
Total Indian CDBG Program Cluster61,219 - -
Housing Voucher Cluster:
Section 8 Housing Choice Vouchers -4,658,668-
14.871
Total Housing Voucher Cluster4,658,668 - -
Passed-Through N.C. Department of Commerce:
Division of Community Assistance:
Scattered Site Housing Grant -11,511 -
10.417
Economic Recovery Grant -71,673 -
10.417
Total U. S. Department of Housing and Urban Development
-5,081,613 -
U. S. Department of Justice - Office of Justice Programs:
Justice Assistance Grant Cluster:
Justice Assistance Grant -28,347 -
16.738
Total Justice Assistance Grant Cluster -28,347 -
Total U. S. Department of Justice
28,347 - -
U. S. Department of Transportation:
Passed-Through N. C. Department of Transportation:
Rural Capital Program Rural Capital Program --
20.505-167,799
Rural Capital Program Rural Capital Program191,907 51,340 -
20.509
Total U. S. Department of Transportation
259,706 51,340 -
U. S. Department of Health and Human Services:
Passed-Through N. C. Department of Health and Human Services
Administration for Children and Families:
Division of Aging and Adult Services:
National Family Caregiver Support -58,168 -
93.052
Aging Cluster:
Grants for Supportive Services and Senior Centers343,989 - 788,200
93.044
Total Aging Cluster343,989 - 788,200
148
Orange County, NC
Schedule of Expenditures of Federal and State Awards
Year Ended June 30, 2012
CFDA Number/ Grant
NumberFederal ExpendituresState ExpendituresLocal Expenditures
Federal Grantor/Program Title
Subsidized Child Care Cluster:
Child Care Development Fund Cluster:
Division of Social Services:
Child Care Development Fund-Administration -164,300 -
93.596
Division of Child Development:
Child Care and Development Fund - Discretionary93.5751,403,428--
Child Care and Development Fund - Mandatory434,719--
93.596
Child Care and Development Fund - Match1,053,356 505,810 -
93.596
Total Child Care Development Fund Cluster 505,8103,055,803 -
Temporary Assistance for Needy Families -538,898 -
93.558
ARRA - Emergency Contingency Fund for Temporary Assistance for Needy Families93.71417,970
Smart Start 363,818- -
XXXX
State Appropriations 594,818- -
TANF-MOE- 138,634 -
Total Subsidized Child Care Cluster3,612,671 1,603,080 -
Centers for Medicare and Medicaid Services
Passed through NC Department of Health and Human Services
Division of Medical Assistance:
Medicaid Cluster:
Medical Assistance Assistance Program93.77892,44535,666-
Adult Care Home Case Management46,70622,44524,260
93.778
Medicaid Expansion10,15310,153-
93.778
Medical Assistance - Administration1,143,757-1,143,757
93.778
Medical Transportation Services20,24110,781-
93.778
Medical Assistance Program - Direct Benefit Payments93.778 37,491,78564,857,485 923
Total Medicaid Cluster66,170,787 37,570,830 1,168,940
Centers for Disease Control and Prevention
Passed through NC Department of Health and Human Services
Division of Public Health:
Public Health emergency Prepardness -44,917 -
93.069
Prevention Investigations and Technical Assistance93.283136,794 - -
Communicable Disease Expansion Budget -31,000 -
93.940
Statewide Health Promotion Program -15,261 -
93.991
Immunization Cluster:
Immunization Program/Aid to County Funding29,702 - -
93.268
Total Immunization Cluster29,702 - -
Administration on Children and Families
Passed through NC Department of Health and Human Services
Division of Social Services:
Temporary Assistance for Needy Families93.55867,650--
Refuge Health1,583--
93.576
Health Resources and Service Administration
Passed through NC Department of Health and Human Services
Division of Public Health:
Maternal and Child Health Services Block Grant 90,168120,210 -
93.994
Office of Population Affairs
Passed through NC Department of Health and Human Services
Office of Population Affairs:
Family Planning -62,117 -
93.217
149
Orange County, NC
Schedule of Expenditures of Federal and State Awards
Year Ended June 30, 2012
CFDA Number/ Grant
NumberFederal ExpendituresState ExpendituresLocal Expenditures
Federal Grantor/Program Title
Division of Social Services:
Administration:
Social Services Block Grant 35,103259,477 98,193
93.667
Social Services Block Grant - In Home Services -94,225 13,461
93.667
Social Services Block Grant - In Home Services over 60 -28,731 4,104
93.667
Social Services Block Grant - Adult Daycare -2,244 320
93.667
Social Services Block Grant - Adult Daycare over 60 1,811- 259
93.667
TANF to SSBG -68,772 -
93.667
Family Preservation -8,080 -
93.556
Crisis Intervention Payments -370,427 -
93.568
Low Income Energy Administration -82,686 -
93.568
Low Income Energy Assistance158,600
93.568
Permanency Planning - Spec 8,12029,138 12,420
93.645
Family Violence Prevention -4,249 1,416
93.671
Independent Living - LINKS -35,169 -
93.674
Links 6,83727,346 -
93.674
IV-D Administration -1,455,066 749,579
93.563
IV-D Offset Fees - Esc -160 82
93.563
IV-D Offset Fees - Federal -2,582 1,330
93.563
NC Health Choice39,3362,9699,727
93.767
Adoption/Foster Care414,108-24,099
93.659
Direct Benefit Payments:
Refugee Assistance Payment -7,964 -
93.566
Energy Assistance Payment -23 -
93.568
AFDC Payments & Penalties (43)(156) (43)
93.560
Total Division of Social Services 54,7963,088,226 914,947
Temporary Assistance for Needy Families Cluster:
Administration:
TANF-Domestic Violence -16,933 -
93.558
TANF- Work First Admin -249,596 259,167
93.558
TANF- Work First Service -887,458 1,111,754
93.558
Direct Benefit Payments:
TANF- Payments & Penalties618,663 - 1,865
93.558
Total Temporary Assistance for Needy Families Cluster1,772,650 - 1,372,786
Foster Care and Adoption Cluster:
Administration:
IV-E CPS 97,966403,981 306,015
93.658
IV-E Foster Care/OErTm -342 114
93.658
IV-E Foster Care/ Off Trn -445,358 445,358
93.658
IV-E Optional Adoption 181,982678,552 181,982
93.659
IV-E Adoption Training -544 181
93.659
IV-E Adoption Training 50% -54,388 54,388
93.659
Direct Benefit Payments:
IV-E Admin County Paid to CCI 7,56715,134 7,567
93.658
IV-E Family Foster Max -599 345
93.658
IV-E Foster Care 40,662151,291 40,663
93.658
IV-E Foster Care in Excess39,371 10,544 10,544
93.658
Total Foster Care and Adoption Cluster1,789,560 338,722 1,047,157
Total U.S. Department of Health and Human Services
39,657,59677,345,285 5,292,030
Corporation for National and Community Service:
Direct Programs:
Aging Action Retired Senior Volunteer Program -80,370 13,663
94.002
U. S. Department of Homeland Security:
Passed-Through N. C. Department of Crime Control and Public Safety
Emergency Management Performance Grant -21,560 -
97.042
Total U.S. Department of Homeland Security
-21,560 -
150
Orange County, NC
Schedule of Expenditures of Federal and State Awards
Year Ended June 30, 2012
CFDA Number/ Grant
NumberFederal ExpendituresState ExpendituresLocal Expenditures
Federal Grantor/Program Title
Environmental Protection Agency
Pased through NC Dept. of Environment and Natural Resources
Capitalization Grants for Clean Water State
64.458
/
CS370884-01
Revolving Loans (Note 2) -2,250,956 -
Total Environmental Protection Agency -2,250,956 -
U. S. Department of Treasury:
Volunteer Income tax Assistance (VITA) Matching Grant -10,198 4,500
21.009
Total Federal awards
39,708,93687,137,337 6,228,207
State Awards:
N. C. Department of Health and Human Services:
Division of Social Services:
Administration:
AFDC Incent/Prog Integrity 22- -
Direct Benefit Payments:
CWS Adopt Subsidy & Vendor 260,792- 79,025
F/C at risk maximization 409- 217
Foster Care Special Provision 10,644- -
State/County Special Assistance Domiciliary Care Pmt 750,221- 750,221
State County Special Assistance -- 79,075
SFHS Maximization 15,183- 15,183
State Foster Home 59,503- 59,503
Work First Non Reimbursable -- 513,217
County Funded Programs1,416,100
Total Division of Social Services- 1,096,774 2,912,540
Office of Juvenile Justice:
Community Based Alternatives 284,441- -
536920
Division of Child Health:
Smart Start 75,000- -
Division of Public Health:
Food and Lodging Fees-6,704 -
Environmental Health-4,000 -
Mosquito-Public Health Pesticide-4,625 -
General Aid to Counties-112,134 -
General Communicable Disease Control-3,708 -
Risk Reduction/Health Promotion-6,198 -
ESMM Community Grants-500 -
Interpreter Grant II-20,900 -
HWTF-Teen Tobacco-86,220 -
WHSF-3,396 -
TPPI - pregnancy prevention-4 -
Tuberculosis 12,995- -
TB Medical Services1,776 -
-
Total Division of Public Health- 263,160 -
Total N. C. Department of Health and Human Services
- 1,719,374 2,912,540
N.C. Department of Transportation:
Rural Operating Assistance Program
Elderly and Disabled Transportation Assistance Program 80,370- -
Work First Program 33,410- -
Rural General Public Program 67,169- -
Safe Roads Act- (61,078) -
Total N. C. Department of Transportation
- 119,871 -
151
Orange County, NC
Schedule of Expenditures of Federal and State Awards
Year Ended June 30, 2012
CFDA Number/ Grant
NumberFederal ExpendituresState ExpendituresLocal Expenditures
Federal Grantor/Program Title
N. C. Department of Cultural Resources:
State Arts Grant 29,891- -
Division of State Library:
Passed-Through Hyconeechee Regional Library:
State Aid to Public Libraries- 113,726 1,791,776
Total N. C. Department of Cultural Resources
- 143,617 1,791,776
N. C. Department of Corrections
Criminal Justice Partnership- 188,940 29,610
N.C. Department of Environment and Natural Resources
Parks and Recreation Trust Fund- 200,733 -
N. C. Department of Public Instruction:
Public School Capital Building Fund - Lottery Proceeds- 2,161,455 -
N.C. Department of Insurance
SHIIP Funds- 4,266 -
Total State awards
- 4,538,256 4,733,926
Total Federal and State Awards
$ 44,247,19387,137,337$ 10,962,134$
1. Basis of Presentation
The accompanying Schedule of Expenditures of Federal and State Awards includes the federal and State grant activity of Orange
County and is presented on the modified accrual basis of accounting. The information in this schedule is presented in accordance
Audits of States, Local Governments, and Non-Profit Organizations
with the requirements of OMB Circular A-133, and the State
Single Implementation Act. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in
the preparation of the basic financial statements. Benefit payments are paid directly to recipients and are not included in the County's
basic financial statements. However, due to the County's involvement in determining eligibility, they are considered federal awards to the
County and are included on this schedule.
2. Subrecipients
Of the federal and State expenditures presented in the schedule, Carolina County provided federal and State awards to
subrecipients as follows:
Pass-through
Grantor'sFederalState
Program TitleNumberExpendituresExpenditures
$ 2,161,455-$
Public School Building Capital Fund - Lottery Proceeds
3. Clustered Prgrams
The following are clustered by the NC Department of Health and Human Services and are treated separately for state audit
requirement purposes: Subsidized Child Care and Foster Care and Adoption
152
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