STATE OF MISSISSIPPI STEVEN A. PATTERSON State Auditor WILLIAM S. JONES, CPA Director, Department of Audit ED P. YARBOROUGH, CPA Director, Division of County Audits_part3 docx

JONES COUNTY Notes to Financial Statements For the Year Ended September 30, 1995 Investments: At year end, the carrying amount of the county's investments was $3,013,797 The county's investments at year end consisted entirely of U S Treasury Bills The investments are registered and are held by the county's agent in the county's name (6) Deferred Compensation Plan The county offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457 The plan, available to all employees of the county, permits participants to defer a portion of their salary until future years, thereby deferring taxation on the portion deferred The deferred compensation is not available to employees until they are separated from service or face an unforeseeable financial emergency All amounts of compensation deferred under the plan, all property rights purchased with those amounts and all income attributable to those amounts, property or rights are (until paid or made available to the employee or his beneficiary) solely the property of the employer (without being restricted to the provisions of benefits under the plan), subject only to the claims of the employer's general creditors Participants' rights under the plan are equal to those of the employer's general creditors in an amount equal to the fair market value of the deferred account for each participant At June 30, 1995, assets held for participants employed by the county and reported in an Agency Fund totaled $469,520 The county believes that it is unlikely that it will use the assets to satisfy the claims of general creditors in the future The county has no liability for losses under the plan, but the Board of Trustees of the Public Employees' Retirement System, as plan administrator, does have the duty of due care that would be required of an ordinary prudent investor (7) Interfund Receivables and Payables Individual fund interfund receivables and payables consisted of the following at September 30, 1995: Interfund Receivables Due from/to Other Funds General Fund $ Special Revenue Funds: Reappraisal maintenance Library Garbage and solid waste Volunteer fire District road maintenance District road maintenance District road maintenance District road maintenance District road maintenance District bridge and culvert District bridge and culvert District bridge and culvert District bridge and culvert District bridge and culvert Total Interfund Payables 257,079 239,285 4,209 3,369 34,701 2,874 18,418 32,643 20,769 44,294 14,883 2,712 4,260 4,649 5,229 2,519 195,529 19 250,000 250,000 JONES COUNTY Notes to Financial Statements For the Year Ended September 30, 1995 Interfund Receivables Interfund Payables 29,035 21,672 3,000 Debt Service Fund: Countywide bond I & S Capital Projects Fund: Community center construction Agency Funds: Jones Junior College maintenance Jones Junior College Support Pat Harrison Waterway Jones Junior College state 11,576 11,576 3,156 Total 26,314 Total Due from/to Other Funds (8) 510,957 $ 510,957 Loans Receivable Loans receivable in the Special Revenue Fund Type on the combined balance sheet at September 30, 1995, consists of the following: Date of Loan Debar Construction community development block grant loan (9) Interest Rate Maturity Date 5-1-95 Styling 5.25 7-1-2006 Balance Payable $ 75,000 Fixed Assets Changes in General Fixed Assets: Balance Oct 1, 1994 Additions Deletions Balance Sept 30, 1995 $ 514,967 4,360,022 1,640,091 2,643,941 765,196 3,456,823 500 3,334,326 1,820,511 370,726 2,559 128,418 87,570 45,089 3,334,326 156,909 59,344 9,360 427,897 7,649,259 126,276 2,857,758 708,411 3,575,881 $ 13,381,040 5,657,040 3,692,598 15,345,482 Governmental Funds: Land Buildings Construction in progress Mobile equipment Other furniture and equipment Leased property under capital leases Total 20 JONES COUNTY Notes to Financial Statements For the Year Ended September 30, 1995 (10) Claims and Judgments Risk Financing The county is exposed to risk of loss related to workers' compensation for injuries to its employees On January 1, 1990, the county decided to stop carrying workers' compensation insurance because of its prohibitive cost and joined the Mississippi Public Entity Workers' Compensation Trust, a public entity risk pool, to cover its exposure to risk of loss The pool was formed on January 1, 1990, by the Mississippi Association of Supervisors, Inc., pursuant to Section 71-3-75, Miss Code Ann (1972), to provide workers' compensation insurance for the benefit of participating counties and various other political subdivisions in the State of Mississippi The county pays premiums to the pool for its workers' compensation insurance coverage and the participation agreement provides that the pool will be self-sustaining through member premiums The retention for the pool is $350,000 for each accident and completely covers all statutory limits set by the Workers' Compensation Commission Risk of loss is remote for claims exceeding the pool's retention liability However, the pool also has catastrophic reinsurance coverage of $1,000,000 per accident, provided by Employers Reinsurance Corporation, effective from January 1, 1995 to January 1, 1996 The pool may make an overall supplemental assessment or declare a refund depending on the loss experience of all the entities it insures The county is exposed to risk of loss relating to employee health coverage On September 1, 1987, the county joined the Mississippi Association of Supervisors Employee Benefit Trust, a public entity risk pool, to account for and finance its uninsured risk of loss The pool was formed by the Mississippi Association of Supervisors, Inc., pursuant to Section 25-15-101, Miss Code Ann (1972), to provide health insurance for the benefit of participating counties in the State of Mississippi Premium payments to the pool are determined on an actuarial basis The pool services all claims for risk of loss to which the county is exposed The county purchases commercial insurance to cover all claims in excess of premium contributions Claims expenses and liabilities are reported when it is probable that a loss has occurred and the amount of that loss can be reasonably estimated Liabilities include an amount for claims that have been incurred but not reported At September 30, 1995, the amount of these liabilities was $87,669 Changes in the reported liability since the fiscal year ended September 30, 1994, resulted from the following: Current Year Claims and Changes in Estimates Beginning of Fiscal Year Liability $ 102,424 $ Balance at Fiscal Year End Claim Payments 593,521 $ 21 608,276 $ 87,669 JONES COUNTY Notes to Financial Statements For the Year Ended September 30, 1995 (11) Lease Obligations Capital As Lessee: The following is an analysis of property leased under capital leases by major classes as of September 30, 1995: General Fixed Assets Group Classes of Property Land and buildings Mobile equipment Other furniture and equipment $ 2,563,695 556,085 456,101 Leased Property Under Capital Leases $ 3,575,881 The following is a schedule by years of future minimum lease payments payable under capital leases together with the present value of the net minimum lease payables as of September 30, 1995: General Long-term Debt Group Year Ending September 30: 1996 1997 1998 1999 2000 Later years $ Total Minimum Lease Payments Less: Amount representing interest 520,477 485,633 419,229 326,285 294,000 1,764,000 3,809,624 1,141,786 Present Value of Net Minimum Lease Payments $ 22 2,667,838 JONES COUNTY Notes to Financial Statements For the Year Ended September 30, 1995 (12) Long-term Debt The following individual liabilities are reported on the combined balance sheet at September 30, 1995: Amount Outstanding Final Maturity Date 80,000 1,320,000 2,730,000 5.9/6 6.4/9 4.3/5.25 3-96 7-98 6-08 570,000 3,540,000 Description and Purpose Interest Rates 5/6.25 4-14 9-09 9-06 7.65 6.45 4.75 4.05 4.75 5.75 5.75 5.25 5.60 7.5 7.5 5.41 6.25 5.38 5.49 6-96 1-96 2-98 2-98 4-99 5-97 4-97 6-98 8-97 9-98 1-97 9-98 7-99 12-96 9-98 10-98 General Long-term Debt Account Group: A General Obligation Bonds: Road and bridge Road and bridge Jail Mississippi Business Investment Act Howard Industries Road and bridge Total $ $ 8,240,000 B Capital Leases: Gibson Building $ IBM AS/400 computer & software for state tag collection interface - Tax Collector Pitney Bowes mail machine IBM AS/400 computer system 12 - '94 Ford cars - Sheriff's Department 1987 Caterpillar rubber tired escavator - Panasonic copiers - Sheriff's Department 1994 Ford F150 truck Durapatcher & storage tank -International 4700 dump trucks Fiat FG85 Allis Chalmers motor grader Panasonic copier Copier and typewriter Komatsu wheel loader Dual tandem trailer Gallion steel wheel roller Used motor grader and Dodge truck Total C Other Loans: State grant - water pollution Mississippi Economic and Community Development loan Superior Manufacturing Citizens National Bank Community Center construction Mississippi Economic and Community Development CDBG loan Debar Construction Total 2,146,215 28,186 1,189 142,702 75,738 38,930 3,052 5,403 28,611 40,012 55,989 5,808 4,785 56,026 3,033 9,159 23,000 $ 2,667,838 $ 353 9-98 114,096 9-04 150,000 5.106 10-99 5.5 7-06 75,000 $ 339,449 23 JONES COUNTY Notes to Financial Statements For the Year Ended September 30, 1995 Annual requirements to amortize outstanding long-term debt reported in the General Long-term Debt Account Group are as follows: Year Ending September 30 1996 1997 1998 1999 2000 Later years Bonds Total Less: Amounts representing interest Total at Present Value $ Loans Total 1,424,105 1,366,780 1,387,610 884,115 893,065 8,707,250 520,477 485,633 419,229 326,285 294,000 1,764,000 45,871 57,507 57,160 56,803 61,434 118,924 1,990,453 1,909,920 1,863,999 1,267,203 1,248,499 10,590,174 14,662,925 6,422,925 $ Leases 3,809,624 1,141,786 397,699 58,250 18,870,248 7,622,961 8,240,000 2,667,838 339,449 11,247,287 Legal Debt Margin - The amount of general obligation bonded debt that can be incurred by the county is limited by state statute Total outstanding general obligation bonded debt during a year can be no greater than 15% of assessed value of the taxable property within the county, according to the then last completed assessment for taxation However, the limitation is increased to 20% whenever a county issues bonds to repair or replace washed out or collapsed bridges on the public roads of the county As of September 30, 1995, the amount of outstanding general obligation bonded debt was equal to 4.6% of the latest property assessments The following changes occurred in liabilities reported at year end: Balance Oct 1, 1994 Additions Reductions Balance Sept 30, 1995 $ 102,424 5,340,000 2,846,504 125,823 593,521 3,700,000 128,418 225,000 608,276 800,000 307,084 11,374 87,669 8,240,000 2,667,838 339,449 $ 8,414,751 4,646,939 1,726,734 11,334,956 Styling General Long-term Debt Account Group: Claims and judgments General obligation bonds Capital leases Other loans Total (13) Contingencies Federal Grants - The county has received federal grants for specific purposes that are subject to audit by the grantor agencies Entitlements to these resources are generally conditional upon compliance with the terms and conditions of grant agreements and applicable federal regulations, including the expenditure of resources for allowable purposes Any disallowance resulting from a grantor audit may become a liability of the county Litigation - The county is party to legal proceedings, many of which occur in the normal course of governmental operations It is not possible at the present time to estimate ultimate outcome or liability, if any, of the county with respect to the various proceedings However, the county's legal counsel believes that ultimate liability resulting from these lawsuits will not have a material adverse effect on the financial condition of the county 24 JONES COUNTY Notes to Financial Statements For the Year Ended September 30, 1995 General Obligation Debt Contingencies - The county issued general obligation bonds for the purpose of providing funds for investment in facilities to be lease purchased by outside enterprise The county maintains title to the property until all debt requirements have been satisfied The industry, as lessee, is required to make lease payments to the county in an amount equal to the debt service requirements as they become due Further, because no income or increase in net worth accrues to the county, the capital lease is not recorded Instead, disclosure is made herewith concerning the county's contingent liability for bonds that the industry repays through lease payments to the county The principal amount of such debt outstanding at year end consists of the following: Balance September 30, 1995 Styling General obligation enterprise bonds (14) $ 7,490,000 No Commitment Debt (Not Included in Financial Statements) No commitment debt is repaid only by the entities for whom the debt was issued and includes debt that either bears the county's name or for which a moral responsibility may exist that is not an enforceable promise to pay No commitment debt explicitly states the absence of obligation by the county other than possibly an agreement to assist creditors in exercising their rights in the event of default Because a default may adversely affect the county's own ability to borrow, the principal amount of such debt outstanding at year end is disclosed as follows: Balance September 30, 1995 Styling Industrial revenue bonds and notes Hospital revenue bonds and notes $ $ Total (15) 80,815,183 18,115,000 98,930,183 Joint Ventures The county participates in the following joint ventures: Jones County is a participant with the Cities of Laurel, Ellisville and Sandersville in a joint venture, authorized by Section 39-3-9, Miss Code Ann (1972), to operate the Laurel-Jones County Library The joint venture was created to provide free public library service to all the people of Jones County and is governed by a four member board, one each appointed by the four member governments By contractual agreement, the county's appropriation to the joint venture amounted to $156,200 Complete financial statements for the Laurel-Jones County Library can be obtained from Laurel-Jones County Library, 530 Commerce Street, Laurel, MS 39440 Jones County is a participant with Forrest County, City of Hattiesburg and City of Laurel in a joint venture, authorized by Section 61-3-5, Miss Code Ann (1972), to operate Hattiesburg/Laurel Regional Airport Authority The joint venture was created to operate a regional airport and is governed by a five member board, one each appointed by the four member governments and one by the Governor of the State of Mississippi By contractual agreement, the county's appropriation from the General Fund to the joint venture amounted to 25 JONES COUNTY Notes to Financial Statements For the Year Ended September 30, 1995 $129,000 Complete financial statements for the Hattiesburg/Laurel Regional Airport Authority can be obtained from Hattiesburg/Laurel Regional Airport Authority, 1002 Terminal, Moselle, MS 39459 Jones County is a participant with Cities of Laurel, Ellisville, Soso and Sandersville in a joint venture, authorized by Section 19-9-11, Miss Code Ann (1972), to operate the Jones County Economic Development Authority The joint venture was created to foster, encourage and facilitate economic development in the county and is governed by a board of trustees composed by 22 members appointed as follows: Jones County Board of Supervisors, six; City of Laurel, three; City of Ellisville, three; City of Sandersville, one; advisory group, nine By contractual agreement, the county's appropriation from the General Fund to the joint venture amounted to $138,400 Complete financial statements for the Jones County Economic Development Authority can be obtained from the Jones County Economic Development Authority, P.O Box 527, Laurel, MS 394410527 (16) Jointly Governed Organizations The county participates in the following jointly governed organizations: Southern Mississippi Planning and Development District operates in a district composed of the Counties of Jones, Jefferson Davis, Covington, Wayne, Marion, Lamar, Forrest, Perry, Greene, Pearl River, Stone, George, Hancock, Harrison and Jackson The Jones County Board of Supervisors appoints one of the 27 members of the district board of directors The county appropriated approximately $64,500 for support of the District in fiscal year 1995 Pine Belt Mental Health Care Resources operates in a district composed of the Counties of Jones, Forrest, Lamar, Perry, Wayne, Greene, Covington, Jefferson Davis and Marion The Jones County Board of Supervisors appoints one of the nine members of the organization's board of commissioners The county appropriated approximately $125,000 for support of the organization in fiscal year 1995 Jones County Junior College operates in a district composed of the Counties of Jones, Clark, Covington, Greene, Jasper, Perry, Smith and Wayne The Jones County Board of Supervisors appoints two of the 20 members of the college board of trustees The county appropriated approximately $1,267,500 for maintenance and support of the college in fiscal year 1995 Pearl River Valley Opportunity, Inc operates in a district composed of the Counties of Jones, Covington, Forrest, Jefferson Davis, Lamar, Marion, Pearl River and Perry The Jones County Board of Supervisors appoints one of the 24 board members The county appropriated approximately $5,960 for support of the organization in fiscal year 1994 Mississippi Regional Housing Authority IV operates in a district composed of the Counties of Jones, Harrison, Hancock, Jackson, Pearl River, Stone, George, Greene, Perry, Forrest, Lamar, Marion, Covington and Wayne The Jones County Board of Supervisors appoints one of the 15 board members The county did not provide any financial support to the organization in fiscal year 1995 (17) Defined Benefit Pension Plan Plan Description Jones County, Mississippi, contributes to the Public Employees' Retirement System of Mississippi (PERS), a cost-sharing, multiple-employer, defined benefit pension plan PERS provides retirement and disability benefits, annual cost-of-living adjustments and death benefits to plan members and beneficiaries Benefit provisions are established by state law and may be amended only by the State of Mississippi Legislature 26 JONES COUNTY Notes to Financial Statements For the Year Ended September 30, 1995 PERS issues a publicly available financial report that includes financial statements and required supplementary information That information may be obtained by writing to Public Employees’ Retirement System, PERS Building, 429 Mississippi Street, Jackson, MS 39201-1005 or by calling 1-800-444-PERS Funding Policy PERS members are required to contribute 7.25% of their annual covered salary and the county is required to contribute at an actuarially determined rate The current rate is 9.75% of annual covered payroll The contribution requirements of PERS members are established and may be amended only by the State of Mississippi Legislature The county's total contributions (both employer and employee shares) to PERS for the years ending September 30, 1995, 1994 and 1993 were $676,882, $602,392 and $601,653, respectively, equal to the required contributions for each year (18) Subsequent Events Subsequent to September 30, 1995, Jones County issued the following debt obligations: Issue Date Interest Rate 1-16-96 3-18-96 4-1-96 5-22-96 6-1-96 6.5 5.34 4.98 5.31 5.43 Issue Amount $ 5,121 15,053 32,000 80,200 26,631 27 Type of Financing Source of Financing Lease purchase Lease purchase Lease purchase Lease purchase Lease purchase Ad valorem tax Ad valorem tax Ad valorem tax Ad valorem tax Ad valorem tax JONES COUNTY (This page left blank intentionally) 28 JONES COUNTY SUPPLEMENTAL INFORMATION 29 ... the county and is governed by a board of trustees composed by 22 members appointed as follows: Jones County Board of Supervisors, six; City of Laurel, three; City of Ellisville, three; City of. .. of Jones, Clark, Covington, Greene, Jasper, Perry, Smith and Wayne The Jones County Board of Supervisors appoints two of the 20 members of the college board of trustees The county appropriated... provisions are established by state law and may be amended only by the State of Mississippi Legislature 26 JONES COUNTY Notes to Financial Statements For the Year Ended September 30, 1995 PERS