NEW ISSUE-Book-Entry Only Ratings: Standard & Poor’s: “AA+”

Moody’s: “Aa1”

(See “RATINGS” herein)

In the opinion of Bond Counsel, under existing laws, regulations, rulings and judicial decisions, interest on the Bonds is excluded

from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative

minimum tax imposed on individuals and corporations, except that interest on the Bonds must be included in the “adjusted current

earnings” of certain corporations for purposes of calculating alternative minimum taxable income. Bond Counsel also is of the

opinion that, under existing laws of the State of Nebraska, interest on the Bonds is exempt from Nebraska state income taxation as

long as it is exempt for purposes of the federal income tax. See “TAX EXEMPTION” herein.

$24,970,000

CITY OF OMAHA, NEBRASKA

Various Purpose and Refunding Bonds

Series 2013A

Dated: Date of Delivery Due: November 15, as shown on inside cover page

The above captioned bonds (the “Bonds”) are issuable in fully registered form in the denominations of $5,000 and integral multiples thereof. Interest on the Bonds is payable semiannually on May 15 and November 15 of each year, commencing May 15, 2014, by check or draft mailed to the registered owner as of the applicable record date at the address shown on the books of registry maintained by First National Bank of Omaha, as Registrar. Principal of the Bonds is payable upon presentation and surrender of the Bonds at the principal corporate office of First National Bank of Omaha, as Paying Agent, in Omaha, Nebraska. The Bonds are subject to optional redemption prior to maturity at the principal amount thereof plus interest to the redemption date all as described in this Official Statement.

The Bonds initially will be registered in the name of Cede & Co., as nominee for The Depository Trust Company, New York, New York (“DTC”), which will act as securities depository for the Bonds. Purchases of the Bonds may be made only in book-entry form in authorized denominations by credit to participating broker-dealers and other institutions on the books of DTC as described herein. Purchasers will not receive certificates evidencing the Bonds. Principal of and interest on the Bonds will be payable by the paying agent directly to DTC as the registered owner thereof. Disbursement of such payments to the DTC Participants is the responsibility of DTC, and disbursement of such payments to the beneficial owners is the responsibility of the DTC Participants and the Indirect Participants, as more fully described herein. Any purchaser of a beneficial interest in the Bonds must maintain an account with a broker or dealer who is, or acts through, a DTC Participant to receive payment of the principal of and interest on such Bonds. See “THE BONDS—Book-Entry Only System” herein.

The proceeds of the Bonds will be used to pay the costs of acquiring equipment and constructing improvements relating to the streets and highways, sewers, public safety and other public facilities and parks and recreation facilities of the City of Omaha (the “City”) and to currently refund certain outstanding indebtedness assumed by the City as a result of its annexations of one Douglas County, Nebraska sanitary and improvement district and certain outstanding general obligation debt previously issued by the City.

THE BONDS ARE PAYABLE FROM AD VALOREM TAXES, UNLIMITED AS TO RATE AND AMOUNT, LEVIED BY THE CITY AGAINST ALL TAXABLE PROPERTY IN THE CITY. THE FULL FAITH AND CREDIT OF THE CITY ARE PLEDGED TO THE PROMPT PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THE BONDS.

MATURITY SCHEDULE

(on inside cover page)

This cover page contains information for convenient reference only. It is not a summary of this issue. Investors must

read the entire Official Statement to obtain information essential and material to the making of an informed investment decision.

The Bonds are being offered when, as and if issued by the City and accepted by the Underwriter, subject to the approval

of legality of the Bonds by Kutak Rock LLP, Bond Counsel, and to certain other conditions. It is expected that delivery of the

Bonds will be made on or about September 26, 2013, at DTC in New York, New York against payment therefor.

Dated: September 17, 2013

MATURITIES, AMOUNTS AND INTEREST RATES

Various Purpose and Refunding Bonds

Series 2013A

Maturity

(November 15) Amount Interest Rate Price

CUSIP

(681712)

2014 $2,720,000 3.000% 103.082% F34 2015 3,460,000 3.000 105.173 F42 2016 2,780,000 3.000 106.478 F59 2017 1,550,000 2.750 106.027 F67 2018 1,245,000 2.000 101.369 F75 2018 250,000 3.000 106.265 F83 2019 1,525,000 3.000 105.568 F91 2020 1,415,000 4.000 110.988 G25 2021 1,445,000 4.000 109.896 G33 2022 715,000 4.000 108.854 G41 2023 715,000 4.000 108.226 G58 2024 715,000 4.000 105.985* G66 2025 715,000 4.000 103.885* G74 2026 715,000 3.500 97.422 G82 2027 715,000 5.000 111.258* G90 2028 715,000 4.500 104.128* H24 2029 715,000 4.500 103.118* H32 2030 715,000 4.625 103.474* H40 2031 715,000 4.750 104.245* H57 2032 715,000 4.750 103.411* H65 2033 715,000 4.250 97.223 H73

The City of Omaha shall not be responsible for the use of the CUSIP numbers selected, nor is any representation made as

to their correctness indicated herein. They are included solely for the convenience of the holders.

* Priced to first call date of November 15, 2023.

CITY OF OMAHA, NEBRASKA

JEAN STOTHERT, MAYOR

CITY COUNCIL

Pete Festersen, President

Chris Jerram Aimee Melton Rich Pahls Franklin Thompson Ben Gray Garry Gernandt

DEPARTMENT DIRECTORS

Allen Herink............................................................................................................. Acting Finance Director Paul D. Kratz ............................................................................................................................. City Attorney James R. Thele ........................................................................................................ Acting Planning Director Todd Schmaderer ....................................................................................................................... Police Chief Bernard Kanger .................................................................................................................. Interim Fire Chief Brook Bench ........................................................................ Parks, Recreation and Public Property Director Robert Stubbe.............................................................................................................. Public Works Director Mikki Frost........................................................................................................... Human Resources Director Gary Wasdin ........................................................................................................................ Library Director Dana Markel.............................................................................................. Convention and Tourism Director Mikki Frost ......................................................................................... Human Rights and Relations Director

Allen Herink, City Comptroller Buster Brown, City Clerk

AUDITOR KPMG LLP

BOND COUNSEL Kutak Rock LLP

UNDERWRITER

[This page left blank intentionally.]

No dealer, broker, salesperson or other person has been authorized by the City or the Underwriter to

give any information or to make any representations in connection with the Bonds or the matters described

herein, other than those contained in this Official Statement, and, if given or made, such other information or

representations must not be relied upon as having been authorized by the City or the Underwriter. This Official

Statement does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of

the Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer,

solicitation or sale. The information and expressions of opinion contained herein are subject to change, without

notice, and neither the delivery of this Official Statement, nor any sale made hereunder, shall, under any

circumstances, create any implication that there has been no change in the matters described herein since the

date hereof. This Official Statement is submitted in connection with the sale of the Bonds referred to herein and

may not be reproduced or used, in whole or in part, for any other purpose. The Underwriter may offer and sell

Bonds to certain dealers and others at prices lower than the offering prices stated on the inside cover page

hereof. The offering prices may be changed from time to time by the Underwriter.

TABLE OF CONTENTS

Page Page

INTRODUCTION ............................................. 1

CITY OF OMAHA GENERAL

INFORMATION .................................. 1 Form of Government ...................................1

City Administration .....................................1

City Financial Management and

Controls .......................................................2

Financial Reporting Systems and

Control Systems ..........................................2

Location and General Background ..............3

Area and Population ....................................3

Transportation .............................................3

Utility Services ............................................4

Education .....................................................4

Health Services ............................................4

Military ........................................................4

Economy .....................................................4

SOURCES OF CITY REVENUES ................... 5 Authority to Levy Property Taxes ...............5

Property Taxes.............................................6

City Sales and Use Taxes ............................6

City Business Taxes ....................................7

Other Revenues ...........................................7

2013 General Fund Forecast ........................7

2014 Budget ................................................7

DISPOSITION OF BOND PROCEEDS ........... 8

SOURCES AND USES ..................................... 8

THE BONDS ..................................................... 8 Description of the Bonds .............................8

Place of Payment .........................................9

Book-Entry Only System ............................9

Optional Redemption ................................ 11

Authority for Issuance ............................... 12

Security ..................................................... 12

Revisions of State Property Tax

System ....................................................... 12

RATINGS ........................................................ 13

CONTINUING DISCLOSURE ....................... 13

UNDERWRITING .......................................... 13

LEGAL OPINION ........................................... 14

TAX EXEMPTION ......................................... 14 Federal and State Tax Exemption .............. 14

Original Issue Discount ............................. 15

Original Issue Premium ............................. 15

Future Legislation ..................................... 16

LITIGATION .................................................. 16 Fire Union Lawsuits .................................. 16

FINANCIAL STATEMENTS ......................... 17

CERTIFICATION AS TO OFFICIAL

STATEMENT .................................... 17

APPENDIX A—CITY OF OMAHA— SELECTED

ECONOMIC INDICATORS

APPENDIX B—CITY OF OMAHA—FINANCIAL

INFORMATION

Part One—Selected City of Omaha Financial

Information

Part Two—Comprehensive Annual Financial Report

APPENDIX C—FORM OF CONTINUING

DISCLOSURE UNDERTAKING

APPENDIX D—FORM OF OPINION OF BOND

COUNSEL

APPENDIX E—SCHEDULE OF REFUNDED

BONDS

[This page left blank intentionally.]

OFFICIAL STATEMENT

$24,970,000

CITY OF OMAHA, NEBRASKA

Various Purpose and Refunding Bonds

Series 2013A

INTRODUCTION

This Official Statement, including the cover page, is furnished in connection with the offering of

$24,970,000 Various Purpose and Refunding Bonds Series 2013A (the “Bonds”) of the City of Omaha,

Nebraska (the “City”).

The Bonds will be issued in strict compliance with the Constitution and laws of the State of

Nebraska, the Home Rule Charter of the City of Omaha, 1956, as amended (the “Charter”) and the

proceedings of the City Council (the “Council”) of the City, including Ordinance No. 39766 (the

“Ordinance”). See “THE BONDS—Authority for Issuance.”

The proceeds of the Bonds will be used to pay the costs of acquiring equipment and constructing

improvements relating to the streets and highways, sewers, public safety and other public facilities and

parks and recreation facilities of the City and to currently refund certain outstanding indebtedness

assumed by the City as a result of its annexations of one Douglas County, Nebraska sanitary and

improvement district and certain outstanding general obligation debt previously issued by the City . See

“DISPOSITION OF BOND PROCEEDS” herein.

This Official Statement contains brief descriptions or summaries of, among other matters, the

Bonds, the City and the Ordinance. Such descriptions and information do not purport to be

comprehensive or definitive. All references herein to the Ordinance are qualified in their entirety by

reference to such document, and references herein to the Bonds are qualified in their entirety by reference

to the form thereof included in the Ordinance. Copies of such documents may be obtained from the City

by writing to the attention of the Finance Director, Tenth Floor, 1819 Farnam Street, Omaha,

Nebraska 68183; telephone: (402) 444-5417.

CITY OF OMAHA GENERAL INFORMATION

Form of Government

Omaha operates with a strong mayor form of government. The Mayor is the City’s full-time

Chief Executive Officer. The City has a seven-member City Council. As a home-rule city, Omaha has

all of the powers available to a home-rule city under the Nebraska Constitution. The Mayor and Council

are elected for four-year terms. The Mayor is elected in a citywide election while the City Council

members are elected by district.

City Administration

The executive and administrative powers of the City are vested in the Mayor, who is popularly

elected for four years on a nonpartisan basis. The Honorable Jean Stothert was elected on May 14, 2013

to a four-year term of office ending in June 2017. A graduate of Seattle Pacific University, Stothert began

her career in nursing. Her 12 years of experience as a critical care nurse and nursing manager included

serving as head nurse and department head of Cardiovascular Surgery at St. Louis University.

2

Stothert was appointed to the Millard School Board in 1997, elected and re-elected for three

terms, including three years as president of the board. In 2009, Stothert was elected to the Omaha City

Council.

The Mayor’s cabinet consists of the chief officers of eleven City Departments. The Mayor

appoints each Department head, except that the Library Board appoints the Public Library Director.

City Financial Management and Controls

City financial management is the responsibility of the Finance Department. In total, the Finance

Department consists of 40 employees and is organized by division. The head of the Finance Department

is the Acting Finance Director of the City, Allen Herink, who also serves as the City Comptroller. Mr.

Herink has 38 years of experience as an accountant with the City of Omaha. He began his career with the

City working in the Grants Accounting Division of the Finance Department. In 1990, he was transferred

to the Budget and Accounting Division. In 1997, Mr. Herink was promoted to Division Manager. He

became Acting City Comptroller in July 2001 and City Comptroller in August 2003. Mr. Herink holds a

Bachelor of Science degree with a major in Accounting from the University of Nebraska at Omaha.

Ms Donna Waller is the City Treasurer. Ms. Waller has eighteen years of experience with the

City. She has spent her career with the City in the Revenue Division of the Finance Department. She was

promoted to Accountant I in 2008 and Accountant II in 2010. She is currently the City Treasurer and

Revenue Manager. The Revenue Division’s activity includes investing, budget implementation, and the

continuous monitoring and internal control of revenue against budget appropriations. It is responsible for

the City’s centralized billing procedures, the collection and deposit of moneys by the Central Cashier and

the Violation Bureau and administration of the Keno game. Ms. Waller holds an Associate Degree in

Professional Studies from Metropolitan Community College and a Bachelor of Science degree with a

major in Business Management from Bellevue University.

Andrew W. Brott, Budget Manager, has eight years of experience with the City of Omaha. He

started as an Accountant in Public Works with his primary responsibility being the maintenance and

calibration of the Combined Sewer Overflow (CSO) Financial Plan Model for the City. Later he

transferred to City Finance, where he continued working with Public Works on budgeting, fund closings,

and the CSO Financial Plan. In January 2010, Mr. Brott became the Budget Manager for the City of

Omaha. Prior to working for the City, Mr. Brott was a Senior Auditor with the State of Nebraska Motor

Fuels Division. He performed tax compliance audits for the State of Nebraska for ten years. Mr. Brott

holds a Bachelor of Science degree with a Major in Accounting and a double Minor in Information

Management and Business Administration from Bellevue University.

Scott Winkler, Accounting Manager, has nine years of experience with the City of Omaha and

nearly 26 years combined experience in accounting, auditing and financial management. Mr. Winkler

began his career with the City as an Accountant I with the Budget and Accounting Division of the

Finance Department. He was promoted to an Accountant II and then in February of 2010, to an

Accountant III and the position of Accounting Manager. Mr. Winkler holds a Bachelor of Science degree

with a major in Accounting and a Master of Arts degree in Information Systems, both from the University

of Nebraska at Lincoln. He is a Certified Public Accountant (CPA) in the State of Nebraska.

Financial Reporting Systems and Control Systems

The Budget and Accounting Division of the Finance Department performs significant and

ongoing monitoring of the financial performance of the operating departments/divisions after budget

adoption. All equipment spending is prioritized, scheduled into semiannual acquisition periods and

submitted by department heads to staff accountants for analysis and review prior to any purchasing

3

activity by the City Purchasing Agent. All purchases and contracts in excess of $20,000 must be

approved by formal City Council action. Department Directors and Division Managers run status reports

detailing actual to budget performance as needed. The City Charter requires quarterly budget status

reporting. These reports forecast year-end revenue and expenditure balances for all operating

departments/divisions. Material variances are investigated promptly as they occur. Remedial actions to

return a division/department to budget might include, but are not limited to, such actions as (i) staff

accountant review and approval of all requisitions prior to receipt by the Purchasing Division,

(ii) postponement or reductions in quantity of materials and equipment purchased, or (iii) deferral of

major budgeted expenditures.

Location and General Background

Omaha, founded in 1854, is the largest city in the State of Nebraska. Omaha is the hub of a vast

transportation network leading to all parts of the nation and thus offers significant advantages to business

and industry competing in regional and national markets. This fact is substantiated by the growth of

population, employment and income during recent years.

Area and Population

The U.S. Census Bureau in the 2010 Census reported the population of the eight–county Omaha

Metropolitan Statistical Area (“MSA”), comprising five Nebraska counties and three Iowa counties,

numbered 865,350 with over 1.1 million within a 60-minute drive. The 2012 population estimate from

the U.S. Census Bureau of the City of Omaha is approximately 419,042 and their estimate for the MSA is

885,624.

Transportation

Over 4.1 million passengers, more than 90 million pounds of cargo and over 48 million pounds of

mail passed through Eppley Airfield, Omaha’s principal airport, in 2012. In the last decade, Eppley

Airfield has made over $110 million in investments in terminal, apron, cargo area and runway expansions.

Eppley Airfield offers between 150 and 170 flights per day and is serviced by six national air carriers

(recent mergers within the industry may change the number), 18 regional airlines, seven air freight

carriers and two full–service general aviation facilities. A total of 63 general aviation aircraft, including

43 executive jets, are based at Eppley Airfield. There are 75-80 departures out of Eppley Airfield daily.

Omaha is general headquarters for the Union Pacific Railroad. The Burlington Northern Santa Fe

and the Canadian National railroads also provide service and combine to make Omaha an important rail

center.

Two interstate highways (Interstate 80 and Interstate 29), five federal highways and seven state

highways provide fast all-weather routes within Nebraska and to and from the rest of the nation. In

addition, Interstate 480 (downtown spur) and Interstate 680 (circumferential route) provide quick access

to all parts of the metropolitan area.

More than 100 motor common carriers haul freight to and from Omaha and all parts of the nation,

making Omaha a major Midwestern trucking center. Several bus lines operate between Omaha and points

in Iowa, Illinois and Nebraska.

4

Utility Services

Residential, commercial and industrial electric service rates in Omaha historically have been

below the national averages, according to reports of the Edison Electric Institute in its Statistical

Yearbook of the Electrical Utility Industry. In addition to low rates, the Omaha Public Power District, a

Nebraska political subdivision, assures its customers ample power with a net generating capability of

3,222.7 megawatts.

The Metropolitan Utilities District (“MUD”), a Nebraska political subdivision, distributes natural

gas and water in the Omaha area. Rates compare favorably with those prevailing in other metropolitan

areas in the nation. Omaha has a plentiful water supply (Missouri River and Platte River wells) and a

water system designed to the standards of the National Board of Fire Underwriters, with a current

capacity of 334 million gallons a day. MUD’s supply of natural gas is purchased wholesale from up to

twenty different suppliers. This supply is supplemented with peak–shaving storage facilities which can

provide up to approximately 30% of peak demand. There have been no interruptions of natural gas

service to firm commercial and residential customers and no interruptions are expected in the foreseeable

future.

Education

Omaha is an important educational center and is the location of Creighton University, the

University of Nebraska at Omaha and the University of Nebraska Medical Center. These institutions,

together with three additional colleges located in Omaha, offer educational programs at the graduate and

undergraduate levels, in law and in the health professions: medicine, dentistry, nursing and pharmacy.

Health Services

There are 13 hospitals within the City of Omaha, six of them classified as acute–care community

hospitals. Of the remaining seven hospitals, two are acute-care hospitals operated by governmental

entities (one by the State of Nebraska and one by Douglas County), four are specialized hospitals

(pediatrics, maternity care, geriatrics and psychiatry) and one is a major hospital of the Veterans

Administration. There are more than 1,200 physicians and more than 300 dentists in Omaha; their

services are utilized both by Omaha residents and by persons within the surrounding region.

Military

The United States Strategic Command (“USSTRATCOM”) is headquartered at Offutt Air Force

Base, just south of Omaha. The missions of U.S. Strategic Command are: to deter attacks on U.S. vital

interests, to ensure U.S. freedom of action in space and cyberspace, to deliver integrated kinetic and non–

kinetic effects to include nuclear and information operations in support of U.S. Joint Force Commander

operations, to synchronize global missile defense plans and operations, to synchronize regional combating

of weapons of mass destruction plans, to provide integrated surveillance and reconnaissance allocation

recommendations to the Secretary of Defense, and to advocate for capabilities as assigned. The estimated

economic impact of Offutt Air Force Base on the Greater Omaha community is more than $1.8 billion.

Economy

From an economy founded on the livestock industry in the late nineteenth century, Omaha is a

major grain exchange market in the United States. Food processing is also an important part of the

economy and is represented by such companies as ConAgra Foods, Inc., Kellogg Company and Omaha

Steaks International.

5

The geographic centrality of Omaha in the United States has encouraged commercial

development, and the City is home to five Fortune 500 companies, which represent a diverse array of

industries: Berkshire Hathaway, ConAgra Foods, Inc., Mutual of Omaha, Peter Kiewit Sons’, Inc. and

Union Pacific Corp. The City’s economy continues to diversify, although it still remains agriculturally

oriented. The Omaha MSA contains more than 650 manufacturing plants, including plants operated by

Lozier Corporation and Valmont Industries Inc. In the early 1980s, Omaha began developing as a major

participant in the reservation, customer service and direct–response center industry. Currently, there are

50 such firms located within the City. In total they employ a labor force in excess of 40,000. Major

employers in this group include First Data Corporation, Oriental Trading Co., Inc., West Corporation,

PayPal, Marriott Worldwide Reservation Center and Omaha Steaks. Omaha is the home of Peter Kiewit

Sons’, Inc., one of the largest construction and mining organizations in North America, TD Ameritrade, a

major discount stock brokerage firm, and 21 insurance companies (with over 50 employees each),

including Mutual of Omaha, the world’s largest mutual health and accident company, and Woodmen of

the World Life Insurance Society, the largest fraternal life insurance company. In December of 2012,

meatpacking employment in the Omaha MSA numbered 6,500. The district offices of the Farm Credit

System for Nebraska, Iowa, South Dakota and Wyoming are headquartered in Omaha.

The City is economically attractive to potential residents. The cost of living in the City in the

first quarter of 2013 across all categories was 87.7% of the national average. Omaha MSA residents

enjoy a median household income of $57,181 — 7% higher than the national average. The

December 2012 seasonally adjusted unemployment rate for the Omaha MSA was 4.2%, compared with

8.2% for the United States.

SOURCES OF CITY REVENUES

Authority to Levy Property Taxes

Under the City Charter, the tax levy of the City in any year for all purposes shall not exceed the

total of (i) $0.6125 per $100 of actual taxable value plus (ii) whatever tax levy is necessary to provide for

principal and interest payments on the indebtedness of the City, for the administrative expenses incurred

in issuing and maintaining bonds, and for the satisfaction of judgments and litigation expenses in

connection therewith, plus (iii) whatever amount is required to finance certain overtime and holiday pay

for members of the police force. In addition, the Omaha Douglas Public Building Commission Act,

pursuant to which the Commission issues bonds, empowers the City to levy a tax on all the taxable

property in the City, except intangible property, of $0.0175 per $100 of actual valuation in excess of the

Charter limitation if and to the extent necessary to make the City’s payments to the Commission.

Effective July 1, 1998, the tax levy of the City (exclusive of levies for preexisting lease purchase

contracts and bonded indebtedness approved according to law and secured by a levy on property) is

limited by state law to 45¢/$100 of taxable valuation. See “THE BONDS—Revision of State Property

Tax System” herein.

The City’s tax levy during its current fiscal year ending December 31, 2013 is 28.447 cents per

$100, plus 19.281 cents per $100 for payment of the City’s general obligation indebtedness, plus 0.600

cents per $100 for satisfaction of judgments and 1.594 cents per $100 for payment on the City’s Special

Redevelopment Levy, for a total levy of 49.922 cents per $100. A detailed summary of the property tax

levied on real and personal property in the City appears in the table entitled “Total Property Tax Levies in

the City of Omaha” in Appendix B.

The City’s tax levy for fiscal year 2014 will remain unchanged at 49.922 cents per $100 of

taxable valuation.

6

Property Taxes

Property taxes on tangible property, real and personal, are levied by the City of Omaha, collected

by the Douglas County Treasurer and remitted to the City. Real property taxes are levied September 1 of

each year and become due December 31. The first half of tax payable becomes delinquent the following

April 1 and the second half August 1. Personal property taxes also are levied September 1 of each year,

become due the following December 31 and become delinquent in halves on the succeeding April 1 and

August 1.

Taxes for Year Shown

Year Ended

December 31 Certified

Amount

Collected

%

Collected

Prior Years’

Taxes

Collected

Total

Collections

% of Total

Collections

to Current

Year Taxes

2001 $ 76,293,126 $ 74,827,346 98.1% $1,529,927 $76,357,273 100.08%

2002 80,926,571 78,176,656 97.1 1,061,170 79,237,826 97.91

2003 82,464,501 80,538,622 97.7 1,479,940 82,018,562 99.46

2004 85,165,599 83,107,249 98.7 1,623,450 84,730,699 99.49

2005 87,170,521 85,897,631 98.5 2,762,734 88,660,364 101.70

2006 93,260,893 91,592,309 98.2 1,572,719 93,165,028 99.90

2007 96,605,427 96,518,640 99.9 1,623,515 98,142,155 101.59

2008 106,888,144 107,891,216 100.9 2,021,689 109,912,905 102.83

2009 115,018,659 113,644,205 98.8 1,708,782 115,586,354 100.49

2010 128,854,709 126,385,602 98.1 1,873,134 128,258,736 99.50

2011 134,239,776 131,111,754 97.7 1,644,917 132,756,671 98.90

2012 137,202,938 136,285,263 99.8 1,456,009 138,341,272 100.80

Source: Records of Finance Department, City of Omaha.

Property Valuations and Property Tax Levies

2009 2010 2011 2012 2013

Actual Valuation $27,077,712,200 $26,889,903,480 $27,483,461,735 $27,913,680,440 $27,803,448,875

Levy (per $100

actual valuation)

47.587¢

49.922¢

49.922¢

49.922¢

49.922¢

Source: Records and Projections of Finance Department, City of Omaha.

City of Omaha taxable property valuations have increased 2.68% from 2009 to 2013, including a 0.4%

decrease in 2013 from 2012. The property tax base has been enhanced through orderly annexation of

developed sanitary and improvement districts contiguous to the City.

City Sales and Use Taxes

The City’s sales tax rate of 1.5%, authorized under the provisions of the Nebraska Revenue Act

of 1967, has remained unchanged since July 1, 1978. Net sales tax collections declined by 1.90% in 2011

and increased by 5.4% in 2012. Through July 2013, actual City sales tax receipts were down 0.4%

compared to the same period in 2012.

7

City Business Taxes

Receipts for telephone occupation tax are projected at $15,375,000 for 2013. The Omaha Public

Power District Occupation Tax rate is 5% of revenues resulting from the sale of electricity within the

corporate limits of the City of Omaha. The 2013 projection of occupation tax of $5,800,000 is based

upon the assumption that weather conditions will be normal. The Cable Television Franchise Fee rate is

5% of gross receipts generated from the operation of cable television within the City of Omaha. The

2013 revenue estimates are $6,153,036. Vehicle Occupation Tax for 2013 is $8 per rental. The 2013

revenues are projected at $2,100,000. Based on the 5.5% per night occupation tax for hotels/motels, the

City estimates that the Hotel/Motel Tax will generate $3,998,590 for the General Fund in 2013.

The new restaurant fee equal to 2.5% of food and beverage sales became effective October 1,

2010 and produced $24.9 million of revenues in 2012. In 2013, the City anticipates the restaurant fee will

generate $25.3 million in revenues.

Other Revenues

The City receives intergovernmental revenues from a number of sources. Federal and state

grants-in-aid and matching funds are received by the City to help fund specific programs and projects.

State tax distributions are appropriated by the Nebraska Legislature according to a formula comparing its

population to the total population of all incorporated municipalities within the State. The Metropolitan

Utilities District pays a payment in lieu of taxes equal to 2% of the annual gross revenue derived from all

retail sales of water and gas sold within the City. The Omaha Public Power District makes payments in

lieu of taxes at the 1957 in-lieu-of-tax levels as dictated by Section 70-651.01, Reissue Revised Statutes

of Nebraska, as amended.

2013 General Fund Forecast

The City formally prepares and makes available a quarterly financial report. For the period

ending June 30, 2013, the City’s quarterly report projects a year-end budget deficit in the City’s General

Fund of $5,211,667. This deficit is primarily due to 2013 unbudgeted costs associated with the labor

dispute between the City and the Omaha Association of Firefighters No. 385 (the “Fire Union”). In

December 2012, the City and the Fire Union reached a labor contract settlement. Prior to reaching the

settlement, the City, in 2011, had set aside $5,297,891 in the Contingent Liability Fund for the expected

costs associated with the labor dispute. Monies in the Contingent Liability Fund will be available and

used to offset the projected deficit in the General Fund in 2013. See the table in APPENDIX B labeled

“SUMMARY OF GENERAL FUND REVENUES AND EXPENDITURES”.

The City continues to monitor purchases and approve only “mission critical” or “public safety”

related items. Hiring is managed through the Job Bank Committee and only essential positions are filled.

2014 Budget

Highlights in connection with the City’s adoption of its 2014 budget, passed on August 28, 2013,

include (2014 budget numbers set forth below are compared to 2013 budgeted numbers):

General Fund appropriations increased to $340.5 million, a 5.8% increase over 2013.

Total health care costs included in the 2014 budget are $59.5 million, of which

approximately $47.7 million is attributable to the General Fund. This is a 7.3% increase

over 2013.

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Overall spending decreased slightly from $793.12 million in 2013 to $792.9 million.

Capital spending for the Public Works Combined Sewer Overflow Program will decrease

by $24 million. This reduction is offset by an increased appropriation for the Fire

Department in the amount of $7.6 million.

Property valuation decreased from $27.9 billion in August 2012 to $27.8 billion in

August 2013, or 0.4%. Property tax levies remain unchanged from 2013.

Several extraordinary items in 2014 are projected to cause overall General Fund revenues

and expenditures to increase by 5.8% over the 2013 amounts. The Elkhorn Fire service

contract was accounted for properly therefore increasing both expenses and revenues by

$4.3 million. The Tobacco Tax Agreement with the University of Nebraska Medical

Center also will increase both expenses and revenues in the amount of $3.7 million. Net

of these extraordinary items, General Fund spending in 2014 is budgeted to increase only

3.3%.

The Restaurant Tax continues to perform well with a budget of $28.0 million in revenues

for 2014, an increase of 9.375% over 2013.

DISPOSITION OF BOND PROCEEDS

The principal and premium of the Bonds will be applied as follows: the amount of approximately

$9,100,000 of the proceeds of such Bonds will be applied to pay the cost of constructing streets and

highways; the amount of approximately $1,200,000 of the proceeds of such Bonds will be applied to pay

the cost of constructing sewers and sewer related infrastructure; approximately $1,100,000 of the

proceeds of such Bonds will be applied to pay for certain public facilities; approximately $1,600,000 of

the proceeds of such Bonds will be used to pay for certain public safety facilities and equipment;

approximately $1,900,000 of the proceeds of such Bonds will be applied to pay for parks and recreation

facilities; and $10,645,000 of the proceeds of such Bonds will be used to currently refund (i) outstanding

debt for which the City became legally liable upon its annexations of Douglas County Sanitary and

Improvement District No. 330 and (ii) certain outstanding general obligation indebtedness previously

issued by the City (collectively, the “Refunded Bonds”). Appendix E identifies the Refunded Bonds.

SOURCES AND USES

Sources:

Bond Proceeds ............................................................................ $24,970,000.00

Net Original Issue Premium ....................................................... 1,318,706.40

Total .............................................................................. $26,288,706.40

Uses:

Redemption of Refunded Bonds ................................................. $11,143,833.63

Deposit into Project Fund ........................................................... 14,905,712.77

Cost of Issuance .......................................................................... 239,160.00

Total .............................................................................. $26,288,706.40

THE BONDS

Description of the Bonds

The Bonds in aggregate principal amount of $24,970,000 will be dated their date of delivery,

which is anticipated to be September 26, 2013, will be issued in fully registered form and will mature as

set forth on the reverse of the cover page of this Official Statement. Interest on the Bonds is payable

semiannually on May 15 and November 15 of each year, commencing May 15, 2014.

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Place of Payment

The principal of the Bonds will be payable in lawful money of the United States of America at the

corporate trust office of First National Bank of Omaha, as paying agent and registrar (the “Paying Agent”

and “Registrar”), in Omaha, Nebraska. Interest on the Bonds will be paid by wire transfer, check or draft

mailed to the person in whose name a Bond is registered as of the May 1 or November 1, as the case may

be, immediately preceding each interest payment date.

Book-Entry Only System

The Bonds initially are being issued solely in book-entry form to be held in the book-entry only

system maintained by The Depository Trust Company (“DTC”), New York, New York. So long as such

book-entry system is used, only DTC will receive or have the right to receive physical delivery of Bonds

and Beneficial Owners (as hereinafter defined) will not be or be considered to be, and will not have any

rights as, owners or holders of the Bonds under the Ordinance. The following information about the

book-entry only system applicable to the Bonds has been supplied by DTC. Neither the City nor the

Paying Agent makes any representations, warranties or guarantees with respect to its accuracy or

completeness.

DTC will act as securities depository for the Bonds. The Bonds will be issued as fully-registered

securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may

be requested by an authorized representative of DTC. One fully-registered Bond certificate will be issued

for each maturity of the Bonds, each in the aggregate principal amount of such maturity and will be

deposited with DTC.

DTC, the world’s largest depository, is a limited-purpose trust company organized under the

New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a

member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York

Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A

of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million

issues of U.S. and non-U.S. equity, corporate and municipal debt issues, and money market instruments

(from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also

facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in

deposited securities, through electronic computerized book-entry transfers and pledges between Direct

Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct

Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies,

clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The

Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National

Securities Clearing Corporation and Fixed Income Clearing Corporation all of which are registered

clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system

is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust

companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct

Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of

“AA+.” The DTC Rules applicable to its Participants are on file with the Securities and Exchange

Commission. More information about DTC can be found at www.dtcc.com.

Purchases of Bonds under the DTC system must be made by or through Direct Participants,

which will receive a credit for the Bonds on DTC’s records. The ownership interest of each actual

purchaser of each Bond (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect

Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their

purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of

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the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant

through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the

Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on

behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership

interests in Bonds, except in the event that use of the book-entry system for the Bonds is discontinued.

To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC are

registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be

requested by an authorized representative of DTC. The deposit of Bonds with DTC and their registration

in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership.

DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC’s records reflect only the

identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be

the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account

of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct

Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial

Owners will be governed by arrangements among them, subject to any statutory or regulatory

requirements as may be in effect from time to time. Beneficial Owners of Bonds may wish to take certain

steps to augment the transmission to them of notices of significant events with respect to the Bonds, such

as redemptions, tenders, defaults, and proposed amendments to the Bond documents. For example,

Beneficial Owners of Bonds may wish to ascertain that the nominee holding the Bonds for their benefit

has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may

wish to provide their names and addresses to the Paying Agent and request that copies of notices be

provided directly to them.

Redemption notices shall be sent to DTC. If less than all of the Bonds within an issue are being

redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in

such issue to be redeemed.

Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to

the Bonds unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under

its usual procedures, DTC mails an Omnibus Proxy to the City, as issuer of the Bonds, as soon as possible

after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those

Direct Participants to whose accounts Bonds are credited on the record date (identified in a listing

attached to the Omnibus Proxy).

Principal and interest payments, redemption proceeds and distributions on the Bonds will be

made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC.

DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding

detail information from the City or the Paying Agent, on payable date in accordance with their respective

holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by

standing instructions and customary practices, as is the case with Bonds held for the accounts of

customers in bearer form or registered in “street name” and will be the responsibility of such Participant

and not of DTC, the Paying Agent or the City, subject to any statutory or regulatory requirements as may

be in effect from time to time. Payment of redemption proceeds, distributions, and interest payments to

Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the

responsibility of the City or the Paying Agent, disbursement of such payments to Direct Participants will

be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the

responsibility of Direct and Indirect Participants.

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DTC may discontinue providing its services as depository with respect to the Bonds at any time

by giving reasonable notice to the City or the Paying Agent. Under such circumstances, in the event that

a successor depository is not obtained, Bond certificates are required to be printed and delivered.

The City may decide to discontinue use of the system of book-entry transfers through DTC (or a

successor securities depository). In that event, Bond certificates will be printed and delivered.

NEITHER THE CITY NOR THE PAYING AGENT WILL HAVE ANY RESPONSIBILITY

OR OBLIGATION TO ANY DIRECT PARTICIPANT, INDIRECT PARTICIPANT OR ANY

BENEFICIAL OWNER OR ANY OTHER PERSON NOT SHOWN ON THE REGISTRATION

BOOKS OF THE PAYING AGENT AS BEING A HOLDER WITH RESPECT TO: (1) THE BONDS;

(2) THE ACCURACY OF ANY RECORDS MAINTAINED BY DTC OR ANY DIRECT

PARTICIPANT OR INDIRECT PARTICIPANT; (3) THE PAYMENT BY DTC OR ANY DIRECT

PARTICIPANT OR INDIRECT PARTICIPANT OF ANY AMOUNT DUE TO ANY BENEFICIAL

OWNER IN RESPECT OF THE PRINCIPAL OR REDEMPTION PRICE OF OR INTEREST ON THE

BONDS; (4) THE DELIVERY BY ANY DIRECT PARTICIPANT OR INDIRECT PARTICIPANT OF

ANY NOTICE TO ANY BENEFICIAL OWNER WHICH IS REQUIRED OR PERMITTED UNDER

THE TERMS OF THE ORDINANCE TO BE GIVEN TO HOLDERS; (5) THE SELECTION OF THE

BENEFICIAL OWNERS TO RECEIVE PAYMENT IN THE EVENT OF ANY PARTIAL

REDEMPTION OF THE BONDS; OR (6) ANY CONSENT GIVEN OR OTHER ACTION TAKEN BY

DTC AS HOLDER.

Each Beneficial Owner for whom a Direct Participant or Indirect Participant acquires an interest

in the Bonds, as nominee, may desire to make arrangements with such Direct Participant or Indirect

Participant to receive a credit balance in the records of such Direct Participant or Indirect Participant, to

have all notices of redemption, elections to tender Bonds or other communications to or by DTC which

may affect such Beneficial Owner forwarded in writing by such Direct Participant or Indirect Participant,

and to have notification made of all debt service payments.

Beneficial Owners may be charged a sum sufficient to cover any tax, fee, or other governmental

charge that may be imposed in relation to any transfer or exchange of their interests in the Bonds.

THE CITY AND PAYING AGENT CANNOT AND DO NOT GIVE ANY ASSURANCES

THAT THE DIRECT PARTICIPANTS OR THE INDIRECT PARTICIPANTS WILL DISTRIBUTE TO

THE BENEFICIAL OWNERS OF THE BONDS (i) PAYMENTS OF PRINCIPAL OF AND

INTEREST ON THE BONDS, (ii) BONDS REPRESENTING AN OWNERSHIP INTEREST OR

OTHER CONFIRMATION OF BENEFICIAL OWNERSHIP INTERESTS IN THE BONDS OR

(iii) REDEMPTION OR OTHER NOTICES SENT TO DTC OR CEDE & CO., ITS NOMINEE, AS

THE REGISTERED OWNERS OF THE BONDS, OR THAT THEY WILL DO SO ON A TIMELY

BASIS OR THAT DTC, DIRECT PARTICIPANTS OR INDIRECT PARTICIPANTS WILL SERVE

AND ACT IN THE MANNER DESCRIBED IN THIS OFFICIAL STATEMENT. THE CURRENT

“RULES” APPLICABLE TO DTC ARE ON FILE WITH THE SECURITIES AND EXCHANGE

COMMISSION, AND THE CURRENT “PROCEDURES” OF DTC TO BE FOLLOWED IN DEALING

WITH DIRECT PARTICIPANTS ARE ON FILE WITH DTC.

Optional Redemption

The Bonds maturing November 15, 2024 and thereafter are subject to redemption at the option of

the City at prior to their stated maturities at any time on or after November 15, 2023, in whole or in part

($5,000 or any multiple thereof) in such order of maturities as determined by the City, and in such manner

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as the Paying Agent deems fair within a maturity, at a price of par, without premium, plus accrued interest

to the date of redemption.

At least 30 days’ notice of redemption will be mailed to the person whose name appears in the

bond registration books as the registered owner of a Bond as of the close of business on the forty-fifth day

immediately preceding the date fixed for redemption.

Authority for Issuance

The Bonds have been authorized in accordance with the Constitution and statutes of the State of

Nebraska, the Charter and proceedings of the Council providing for the issuance thereof, including the

Ordinance. The issuance of the Bonds, except for the portion used to refund the Refunded Bonds, was

approved by the voters of the City at the May 11, 2010 election relating to each such purpose. The

issuance of the portion of the Bonds used for the refunding purposes described under “DISPOSITION OF

BOND PROCEEDS” was approved by the City Council by authority of Sections 10-142, 10-615 and 10-

616, Reissue Revised Statutes of Nebraska, as amended, and applicable provisions of the Charter.

Security

The Bonds are general obligations of the City, and the City is obligated to levy ad valorem taxes

for the payment of said Bonds and the interest thereon upon all property within the City subject to

taxation by the City without limitation as to rate or amount. The full faith and credit of the City shall be

pledged to the prompt payment of the principal of and interest on the Bonds. See “SOURCES OF CITY

REVENUES – Authority to Levy Property Taxes” herein.

Revisions of State Property Tax System

The State of Nebraska’s system of assessing and taxing real and personal property for purposes of

local ad valorem taxation for support of local political subdivisions, including the City, was the subject in

the late 1990’s of constitutional amendment, legislation and litigation the result of which was to

substantially resolve certain challenges to the validity of the tax system.

Governmental units in Nebraska may not adopt budgets for fiscal years in excess of 102.5% of

the prior fiscal year’s budget plus allowable growth (which includes increases in taxable valuation for

such things as new construction and annexations). However, such budgetary limitations do not apply to,

among other things, revenue pledged to retire bonded indebtedness or budgeted for capital improvements.

Governmental units may exceed the budget limit for a given fiscal year by up to an additional 1% upon

the affirmative vote of at least 75% of the governing body or in such amount as is approved by a majority

vote of the electorate. The property tax levies of incorporated cities and villages, such as the City, are

limited to a maximum of 45¢/$100 of taxable valuation (plus an additional 5¢/$100 to pay the

municipality’s share of revenue required under interlocal agreements). The levy limit does not apply to

levies for preexisting lease-purchase contracts approved prior to July 1, 1998, to bonded indebtedness,

such as the Bonds, approved according to law and secured by a levy on property and to pay judgments.

The City’s 2013 General Fund levy, exclusive of such unlimited levies, is 28.447¢/$100 of taxable

valuation. A political subdivision may exceed its levy limitation for a period of up to five years by

majority vote of the electorate.

There can be no assurance that Nebraska’s system of assessing and taxing real and personal

property will remain substantially unchanged, given the possibility of further legislation and litigation.

Such changes could materially and adversely affect the amount of property tax revenues the City and

other local governments could collect in future years. The City does not believe, however, that the

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Nebraska Legislature would leave the City without adequate taxing resources to pay for its programs and

meet its financial obligations, including the repayment of its bonds, lease-purchase obligations and other

obligations. The opinion of Bond Counsel will be rendered based on the law existing as of the date of

issuance of the Bonds and in reliance upon general legal presumptions in favor of the constitutionality of

statutes and upon the holdings of existing case law.

RATINGS

Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. (“S&P”),

has given the Bonds a rating of “AA+” and Moody’s Investors Service (“Moody’s”) has given the Bonds

a rating of “Aa1.” Any desired explanation of the significance of such ratings should be obtained from

S&P and from Moody’s. The City furnished the rating agencies with certain information and materials

relating to the Bonds and the City which have not been included in this Official Statement. Generally, a

rating agency bases its rating on the information and materials so furnished and on investigations, studies

and assumptions made by such rating agency. There is no assurance that a particular rating will be

maintained for any given period of time or that it will not be lowered or withdrawn entirely if, in the

judgment of the agency originally establishing the rating, circumstances so warrant. Neither the City nor

the Underwriter has undertaken any responsibility either to bring to the attention of the owners of the

Bonds any proposed revision or withdrawal of the rating of the Bonds or to oppose any such proposed

revision or withdrawal. Any such change in or withdrawal of such rating could have an adverse effect on

the market price of the Bonds. Any explanation of the significance of such ratings should be obtained

from the rating agency furnishing such rating.

CONTINUING DISCLOSURE

The Ordinance includes the City’s undertaking (the “Undertaking”) for the benefit of the holders

and beneficial owners of the Bonds to send certain financial information and operating data to the

Municipal Securities Rulemaking Board (“MSRB”) annually and to provide notice to the MSRB of

certain events, pursuant to the requirements of Section (b)(5)(i) of Securities and Exchange Commission

Rule 15c2-12 (17 C.F.R. § 240.15c2-12) (the “Rule”). See “APPENDIX C—FORM OF CONTINUING

DISCLOSURE UNDERTAKING.”

A failure by the City to comply with the Undertaking will not constitute an Event of Default

under the Ordinance, although any bondholder will have any available remedy at law or in equity,

including seeking specific performance by court order, to cause the City to comply with its obligations

under the Undertaking. Any such failure must be reported in accordance with the Rule and must be

considered by any broker, dealer or municipal securities dealer before recommending the purchase or sale

of the Bonds in the secondary market. Consequently, such a failure may adversely affect the

transferability and liquidity of the Bonds and their market price. Except for the failure promptly to

provide notice of bond insurance related downgrades by the rating agencies of the ratings on the City’s

Series 2006 Sewerage System Revenue Bonds in 2009 and the failure timely to provide notice of a

downgrade in 2012 by Moody’s of the rating on the City’s general obligation bonds, the City has been in

compliance with its continuing disclosure obligations under its existing undertakings entered into

pursuant to the Rule. The City now is in compliance with its continuing disclosure undertakings.

UNDERWRITING

Under a Bond Purchase Agreement (the “Agreement”) entered into by and between the City and

D.A. Davidson & Co. (the “Underwriter”), the Bonds are being purchased at a price of par plus a net

original issue premium of $1,318,706.40 (from which will be paid $174,790.00 of Underwriter’s

discount) by the Underwriter for public reoffering by the Underwriter at the initial public offering prices

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or yields set forth on the inside of the cover page of this Official Statement. The Agreement provides that

the Underwriter will purchase all of the Bonds if any are purchased. The obligation of the Underwriter to

accept delivery of the Bonds is subject to various conditions contained in the Agreement, including the

absence of pending or threatened litigation questioning the validity of the Bonds or any proceedings in

connection with the issuance thereof and the absence of material adverse changes in the financial or

business condition of the City.

The Underwriter intends to offer the Bonds to the public initially at the offering prices set forth

on the inside of the cover page of this Official Statement, which prices may subsequently change without

any requirement of prior notice. The Underwriter reserves the right to join with dealers and other

underwriters in offering the Bonds to the public. The Underwriter may offer and sell Bonds to certain

dealers (including dealers depositing Bonds into investment trusts) at prices lower than the public offering

price.

LEGAL OPINION

The approving opinion of Kutak Rock LLP (“Bond Counsel”) will affirm, among other things,

that the Bonds have been authorized and issued in accordance with the Constitution and statutes of the

State of Nebraska and the Charter of the City of Omaha, and constitute valid and legally binding

obligations of the City, and that the City has the power and is obligated to levy ad valorem taxes for the

payment of the Bonds and the interest thereon upon all the property within the City subject to taxation by

the City without limitation as to rate or amount. The rights of the holders of the Bonds and the

enforceability thereof may be subject to valid bankruptcy, insolvency, reorganization, moratorium and

other laws for the relief of debtors.

TAX EXEMPTION

Federal and State Tax Exemption

In the opinion of Bond Counsel, to be delivered at the time of original issuance of the Bonds,

under existing laws, regulations, rulings and judicial decisions, interest on the Bonds (including any

original issue discount treated as interest) (a) is excludable from gross income for federal income tax

purposes and (b) is not a specific item of tax preference for purposes of calculating the federal alternative

minimum tax imposed on individuals and corporations. Interest on the Bonds, however, must be included

in the “adjusted current earnings” of certain corporations (i.e., alternative minimum taxable income as

adjusted for certain items, including those items that would be included in the calculation of a

corporation’s earnings and profits under Subchapter C of the Code) and such corporations are required to

include in the calculation of alternative minimum taxable income 75% of the excess of each such

corporation’s adjusted current earnings (which includes tax-exempt interest) over its alternative minimum

taxable income (determined without regard to this adjustment and prior to reduction for certain net

operating losses).

The opinions set forth above are subject to continuing compliance by the City with its covenants

regarding federal tax laws in the Ordinance. Failure to comply with such covenants could cause interest

on the Bonds to be included in gross income retroactive to the date of issue of the Bonds.

The accrual or receipt of interest on the Bonds may otherwise affect the federal income tax

liability of certain recipients, such as banks, thrift institutions, property and casualty insurance companies,

corporations (including S corporations and foreign corporations operating branches in the United States),

Social Security or Railroad Retirement benefit recipients, taxpayers otherwise entitled to claim the earned

income credit or taxpayers who may be deemed to have incurred (or continued) indebtedness to purchase

15

or carry tax-exempt obligations. The nature and extent of these other tax consequences will depend upon

the recipients’ particular tax status or other items of income or deduction. Bond Counsel expresses no

opinion regarding any such consequences, and investors should consult their own tax advisors regarding

the tax consequences of purchasing or holding the Bonds.

In Bond Counsel’s further opinion, under the existing laws of the State of Nebraska, the interest

on the Bonds is exempt from Nebraska state income taxation so long as it is exempt for purposes of the

federal income tax.

Original Issue Discount

The Bonds maturing in the years 2026 and 2033 (collectively, the “Discount Bonds”), are being

sold at an original issue discount. The difference between the initial public offering prices, as set forth on

the inside cover page, of such Discount Bonds and their stated amounts to be paid at maturity constitutes

original issue discount treated as interest which is excluded from gross income for federal income tax

purposes, as described above.

The amount of original issue discount which is treated as having accrued with respect to such

Discount Bonds is added to the cost basis of the owner in determining, for federal income tax purposes,

gain or loss upon disposition of such Discount Bonds (including its sale, redemption or payment at

maturity). Amounts received upon disposition of such Discount Bonds which are attributable to accrued

original issue discount will be treated as tax-exempt interest, rather than as taxable gain, for federal

income tax purposes.

Original issue discount is treated as compounding semiannually, at a rate determined by reference

to the yield to maturity of each individual Discount Bond, on days which are determined by reference to

the maturity date of such Discount Bond. The amount treated as original issue discount on such Discount

Bond for a particular semiannual accrual period is equal to the product of (i) the yield to maturity for such

Discount Bond (determined by compounding at the close of each accrual period) and (ii) the amount

which would have been the tax basis of such Discount Bond at the beginning of the particular accrual

period if held by the original purchaser, less the amount of any interest payable for such Discount Bond

during the accrual period. The tax basis is determined by adding to the initial public offering price on

such Discount Bond the sum of the amounts which have been treated as original issue discount for such

purposes during all prior periods. If such Discount Bond is sold between semiannual compounding dates,

original issue discount which would have been accrued for the semiannual compounding period for

federal income tax purposes is to be apportioned in equal amounts among the days in such compounding

period.

Owners of Discount Bonds should consult their tax advisors with respect to the determination and

treatment of original issue discount accrued as of any date and with respect to the state and local tax

consequences of owning a Discount Bond.

Original Issue Premium

The Bonds maturing in the years 2014 through 2025, inclusive, and in the years 2027 through

2032, inclusive (collectively, the “Premium Bonds”), are being sold at a premium. An amount equal to

the excess of the issue price of a Premium Bond over its stated redemption price at maturity constitutes

premium on such Premium Bond. An initial purchaser of a Premium Bond must amortize any premium

over such Premium Bond’s term using constant yield principles, based on the purchaser’s yield to

maturity (or, in the case of Premium Bonds callable prior to their maturity, by amortizing the premium to

the call date, based on the purchaser’s yield to the call date and giving effect to the call premium, if any).

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As premium is amortized, the purchaser’s basis in such Premium Bond is reduced by a corresponding

amount resulting in an increase in the gain (or decrease in the loss) to be recognized for federal income

tax purposes upon a sale or disposition of such Premium Bond prior to its maturity. Even though the

purchaser’s basis may be reduced, no federal income tax deduction is allowed. Purchasers of Premium

Bonds should consult with their tax advisors with respect to the determination and treatment of

amortizable premium for federal income tax purposes and with respect to the state and local tax

consequences of owning a Premium Bond.

Future Legislation

From time to time, there are legislative proposals in the Congress and in the states that, if enacted,

could alter or amend the federal and state tax matters referred to above or adversely affect the market

value of the Bonds. It cannot be predicted whether or in what form any such proposal might be enacted

or whether if enacted it would apply to bonds issued prior to enactment. In addition, regulatory actions

are from time to time announced or proposed and litigation is threatened or commenced which, if

implemented or concluded in a particular manner, could adversely affect the market value of the Bonds.

It cannot be predicted whether any such regulatory action will be implemented, how any particular

litigation or judicial action will be resolved, or whether the Bonds or their market value would be affected

thereby. Purchasers of the Bonds should consult their tax advisors regarding any pending or proposed

legislation, regulatory initiatives or litigation. The opinions expressed by Bond Counsel are based upon

existing legislation and regulations as interpreted by relevant judicial and regulatory authorities as of the

date of issuance and delivery of the Bonds, and Bond Counsel has expressed no opinion as of any date

subsequent thereto or with respect to any pending legislation, regulatory initiatives or litigation.

LITIGATION

The City is party to legal proceedings which occur in government operations and include claims

for property damage and personal injury, contract disputes, discrimination claims and property

condemnation proceedings. The legal proceedings, in the opinion of the City management, based on the

advice of the City Attorney, are not expected to have a materially adverse effect on the City’s financial

position at June 30, 2013, after giving effect to available funds provided for such contingencies in the

Judgment, Cash Reserve and Contingent Liability Reserve Funds and alternative methods of satisfying

judgments, these being identified as:

—City’s authority to levy under Judgment Fund set by Home Rule Charter.

—State Statute, Section 77-1620 R.R.S. 1943, which authorizes a special levy for

payment of judgments.

—State Statute, Section 13-918 R.R.S. 1943, which authorizes the City to borrow money

from the State to satisfy certain judgments.

In addition to amounts recorded by the City as other accrued liabilities, the City Attorney is of the

opinion that there is a reasonable possibility that the City will incur additional losses on these lawsuits of

approximately $6,526,000.

Fire Union Lawsuits

For a discussion of certain litigation and other developments involving the City and the Fire

Union, see “POLICE AND FIRE RETIREMENT SYSTEM–Current Developments” in Appendix B.

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FINANCIAL STATEMENTS

The comprehensive annual financial report of the City as of and for the year ended December 31,

2012 included as Part Two of Appendix B has been audited by KPMG LLP, independent certified public

accountants, as stated in their report appearing therein.

CERTIFICATION AS TO OFFICIAL STATEMENT

The City of Omaha, Nebraska, will furnish a certificate signed on its behalf by Allen Herink,

Acting Finance Director of the City of Omaha, and delivered concurrently with the delivery of the Bonds,

to the effect that at the date of this Official Statement and at the date of delivery of the Bonds, (i) the

information and statements, including financial statements, of or pertaining to the City, contained in this

Official Statement were and are correct in all material respects; and (ii) insofar as the City and its affairs,

including its financial affairs, are concerned, this Official Statement did not and does not contain an

untrue statement of a material fact or omit to state a material fact required to be stated therein or

necessary to make the statements therein, in the light of the circumstances under which they were made,

not misleading. The City, by such certificate, will further confirm to the effect that insofar as the

descriptions and statements, including financial data, contained in the Official Statement of or pertaining

to nongovernmental bodies or governmental bodies other than the City are concerned, such descriptions,

statements and data have been obtained from sources believed by the City to be reliable, and that the City

has no reason to believe that they are untrue or incomplete in any material respect.

The execution and delivery of this Official Statement have been duly authorized by the City as of

the date shown on the cover hereof.

CITY OF OMAHA, NEBRASKA

By: /s/ Jean Stothert

Mayor

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APPENDIX A

CITY OF OMAHA— SELECTED ECONOMIC INDICATORS

Omaha MSA Population and Employment

Population1

Non-Farm

Employment2

2000 767,140 441,600

2001 775,251 444,500

2002 782,158 439,400

2003 790,252 440,700

2004 800,155 441,900

2005 810,155 448,800

2006 819,073 456,800

2007 827,666 463,600

2008 837,925 469,800

2009 828,855 459,500

2010 865,350 457,300

2011 877,171 461,300

2012 885,624 467,400

______________________ 1 Source: U.S. Census Bureau

2 Source: Greater Omaha Chamber of Commerce; U.S. Bureau of Labor Statistics..

Omaha MSA (Eight Counties) Non-Farm Employment

Industry Average for 2012 Average for 2013*

Number % of Total Number % of Total

Mining, Logging and Construction 21,100 4.5% 21,800 4.7%

Manufacturing 31,300 6.7 31,500 6.7

Trade, Transportation and Utilities 93,800 20.1 92,700 19.8

Information 11,400 2.4 11,300 2.4

Financial Activities 41,600 8.9 41,700 8.9

Professional and Business Services 66,700 14.3 66,400 14.2

Education and Healthcare Services 73,100 15.6 74,000 15.8

Leisure and Hospitality 45,600 9.8 45,800 9.8

Other Services 17,400 3.7 17,400 3.7

Government 65,500 14.0 65,400 14.0

Total Non-Farm Employment 467,400 100.0% 467,900 100.0%

Source: U.S. Bureau of Labor Statistics: State and Area Employment, Hours and Earnings

* For seventh month period ending July 31, 2013

A-2

Omaha MSA Personal Income (per capita)

Year Personal Income

Per Capita

Personal Income

U.S. Per Capita

Personal Income

2000 $24,935,879 $32,414 $26,206

2001 25,905,005 33,376 27,179

2002 26,879,221 34,304 28,127

2003 27,922,390 35,252 29,201

2004 29,683,944 36,956 30,700

2005 31,076,985 38,164 31,763

2006 33,391,162 40,476 33,591

2007 35,244,303 42,231 34,829

2008 37,175,293 43,988 36,104

2009 35,538,239 41,505 35,598

2010 36,986,509 42,606 36,296

2011 39,005,295 44,470 37,776

2012 N/A N/A 38,965

Source: Bureau of Economic Analysis, SA1-3, CA1-3.

Omaha MSA1 Net Taxable Sales

Year

Total Net

Taxable Sales (000)

Net Taxable Sales

of Motor Vehicles (000)

2000 $7,006,016 $970,867

2001 7,241,327 1,133,659

2002 7,331,540 1,164,841

2003 7,667,430 1,171,888

2004 8,365,580 1,124,848

2005 8,669,035 1,055,036

2006 8,796,364 1,013,663

20072 9,116,077 1,092,087

2008 9,235,201 1,093,682

2009 8,974,240 1,093,115

2010 9,242,676 1,152,824

2011 9,639,416 1,224,889

2012 9,813,262 1,317,213

Source: Nebraska Department of Revenue. 1 Includes the five Nebraska Counties in the eight County MSA.

2 Nebraska Counties of MSA (Cass, Douglas, Sarpy, Washington, Saunders (1997-present)) through October 2007.

A-3

Value of Building Permits—City of Omaha

Year Amount Year Amount

2000 $473,849,942 2007 $663,007,432

2001 1,558,867,305 2008 795,783,313

2002 701,502,687 2009 511,966,409

2003 633,542,187 2010 530,331,594

2004 623,481,197 2011 477,008,844

2005 673,153,699 2012 560,651,422

2006 605,536,231 2013 460,016,875*

Source: Division of Permits and Inspections, City of Omaha.

* Through June 30, 2013

Largest Employers—City of Omaha Metro Area

April 2013

Company Product/Service Number of Employees

Offutt Air Force Base* National Security 8,879

Alegent Health Healthcare 8,600

Omaha Public Schools Education 7,239

The Nebraska Medical Center Healthcare 5,600

Methodist Health System Healthcare 5,500

University of Nebraska Medical Center Healthcare 4,974

First Data Corp. Transaction Processing 4,900

Union Pacific Corp. Railroad 4,500

Hy-Vee Inc. Supermarkets 3,963

First National Bank of Omaha Banking 3,707

West Corp. Telemarketing 3,600

Walmart Stores Store 3,500

ConAgra Foods Food products 3,300

Mutual of Omaha Insurance 3,235

Creighton University Education 3,010

University of Nebraska at Omaha Education 3,000

Millard Public Schools Education 2,719

City of Omaha Administration 2,562

PayPal Transaction Processing 2,500

Omaha Public Power District Energy 2,300

Located in Sarpy County (immediately south of Omaha).

Source: Greater Omaha Chamber of Commerce Top 25 Employer List, (Ranked by Number of Employees).

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APPENDIX B

CITY OF OMAHA—FINANCIAL INFORMATION

Part One

Selected City of Omaha Financial Information

Part Two

Comprehensive Annual Financial Report

(December 31, 2012)

[This page left blank intentionally.]

APPENDIX B

CITY OF OMAHA—FINANCIAL INFORMATION

PART ONE

Selected City of Omaha Financial Information

B-2

CITY OF OMAHA, NEBRASKA

GENERAL FUND STATEMENT OF REVENUE,

EXPENDITURES AND CHANGES IN FUND BALANCE

Five Years ended December 31, 2012

Revenue: 2008 2009 2010 2011 2012

General Property Tax $61,795,651 $64,773,742 $70,912,516 $75,955,957 $79,123,615

Motor Vehicle Taxes 9,374,405 9,299,184 9,309,995 9,068,784 9,163,518

City sales & use tax 121,532,796 121,309,926 126,138,188 124,935,836 131,859,046

Business taxes 33,830,794 33,664,179 38,143,460 60,024,570 62,170,182

Taxes in lieu 5,817,788 6,779,901 4,474,712 4,649,772 3,956,031

Licenses & permits 8,155,504 7,125,362 7,935,989 7,532,462 8,417,387

Intergovernmental revenue 3,619,494 3,541,861 3,421,652 1,903,495 (480)

Charges for services 19,842,674 19,946,262 21,961,139 19,862,579 20,613,005

Investment income 3,847,009 1,195,845 646,181 1,149,584 682,977

Rents & royalties 104,961 130,130 1,118,960 1,017,478 965,061

Miscellaneous 1,685,643 1,331,891 469,175 1,198,139 107,663

Total Revenue $269,606,719 $269,098,283 $284,531,967 $307,298,656 $317,058,005

Expenditures

Legislative & Executive $2,540,850 $2,597,111 $2,621,519 $2,729,891 $2,942,295

Law, Personnel & Human Relations 5,824,839 5,661,845 5,892,037 5,988,295 6,118,347

Finance 2,276,814 2,480,074 2,417,849 2,814,410 3,282,205

Planning 6,612,669 6,603,010 6,633,359 7,021,676 7,095,017

Parks, Recreation & Public Property 17,887,259 16,977,290 18,134,827 17,749,191 18,538,311

Fire 74,905,411 74,257,000 71,977,607 80,849,513 78,719,244

Police 93,597,942 93,603,374 100,729,317 110,185,046 115,622,102

Public Works 14,988,397 15,588,063 16,731,652 15,318,718 17,780,113

Public Library 8,173,587 8,098,422 9,874,149 10,420,102 10,660,030

Employee Benefits 19,359,233 22,005,057 20,289,850 19,248,137 19,449,521

Agency &Other Accounts 24,771,326 27,598,496 29,172,082 34,720,357 31,916,831

Total Expenditures $270,938,327 $275,469,742 $284,474,248 $307,045,336 $312,124,016

Excess (deficit) of revenues

over expenditures: (1,331,608) (6,371,459) 57,719 253,320 4,933,989

Other sources:

Operating transfers and

encumbrance adjustments (net) 545,751 2,475,349 1,084,595 2,460,993 1,410,550

Excess (deficiency) of revenues

over expenditures & other sources

(uses) of financial resources* (785,857) (3,896,110) 1,142,314 2,714,313 6,344,539

Fund balance, beginning of year 6,555,432 5,769,575 1,873,465 3,015,779 5,730,092

Fund balance, end of year $5,769,575 $1,873,465 $3,015,779 $5,730,092 $12,074,631

Source: Records of the Finance Department, City of Omaha

*City of Omaha's procedure in General Fund budgeting is as follows: at the end of each fiscal year the excess, if any, of revenues and adjustments over

expenditures and encumbrances is determined. Any such excess, less extraordinary transfers out, if any, is used as the initial credit to the General Fund Budget

for the second year following the year in which the excess has arisen. The year-end fund balance of $12,074,631 is the sum of the 2010 to 2012 carryover of $2,714,313 and the 2012 to 2014 carryover of $9,360,318.

B-3

CITY OF OMAHA, NEBRASKA

DEBT SERVICE FUND* STATEMENT OF REVENUE,

EXPENDITURES AND CHANGES IN FUND BALANCE

Five Years Ended December 31, 2012

2008 2009 2010 2011 2012

REVENUE:

Taxes $44,536,697 $46,832,517 $52,067,867 $51,383,865 $53,660,317

In-lieu-of taxes 74,594 74,607 56,027 197,923 196,169

Interest income 252,097 214,294 437,998 356,304 966,136

Parking fees 1,328,971 945,928 1,398,895 1,312,672 1,099,677

Seat tax 544,927 360,975 457,758 401,049 416,817

State turn back revenue 2,404,735 2,380,069 3,544,079 2,693,907 3,292,609

Contributions from annexed areas 10,568,138 491,410 163,248 3,259,230 2,161,516

Build America Bond Credits - - 227,781 309,704 253,440

Total revenue and contributions $59,710,159 $51,299,800 $58,353,653 $59,914,654 $62,046,680

EXPENDITURES:

Outside services:

Professional fees & liabilities $2,071,744 $1,151,204 $550,778.00 $338,170 $664,677

Collection fees 446,385 342,458 579,338.00 506,057 554,322

Total outside services 2,518,129 1,493,662 1,130,116 844,227 1,218,999

General obligation bonds:

Interest expense 28,463,687 27,786,112 25,072,592 24,262,597 23,226,637

Bonds retired 109,871,890 76,393,269 67,332,307 43,297,591 77,149,260

Total general obligation bonds 138,335,577 104,179,381 92,404,899 67,560,189 100,375,897

Total expenditures $140,853,706 $105,673,043 $93,535,015 $68,404,416 $101,594,896

Deficit of revenues and contributions

under expenditures

(81,143,547) (54,373,243) (35,181,362) (8,489,762) (39,548,216)

Other Financing sources :

Refunding bonds 83,628,251 48,886,711 38,385,126 10,391,684 39,641,871

Excess (deficit) of revenues and

contributions over (under) expenditures

and other financing sources 2,484,704 (5,486,532) 3,203,764 1,901,922 93,655

Fund balance at beginning of year: 16,491,540 18,976,244 13,489,712 16,693,476 18,595,398

Fund balance at end of year: $18,976,244 $13,489,712 $16,693,476 $18,595,398 $18,689,053

*This fund was created by the City Charter and is sustained by a separate debt service fund property tax levy. Its purpose is to accumulate resources for

servicing the general obligation bonded debt of the City. The actual property tax revenues are derived from a levy of 17.581 cents per one hundred dollars of taxable valuation in 2008, 2009 and 19.281 in 2010, 2011 and 2012.

B-4

CITY OF OMAHA SPECIAL TAX REVENUE REDEVELOPMENT AND

SPECIAL OBLIGATION DEBT SERVICE FUND

Five Years Ended December 31, 2012

2008 2009 2010 2011 2012

Revenues:

Property tax revenue (redevelopment levy) $2,266,497 $2,386,049 $4,175,584 $4,258,621 $4,428,183

Tax allocation revenue 2,270,964 1,975,044 1,841,934 1,775,251 1,839,814

State cigarette tax 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000

Douglas County Miller Park contribution 141,177 141,177 141,177 141,177 141,177

Naming rights convention center 825,000 825,000 825,000 825,000 825,000

Land sales 77,500 850,000 - - -

Refunding Bonds\Other Income 40,596,567 75,119 87,548 90,279 126,735

Investment Earnings - - - 192,704 35,135

Sewer Revenue Fees* 1,518,584 1,517,163 1,515,164 1,515,196 1,513,723

Total revenues $49,196,289 $9,269,552 $10,086,406 $10,298,228 $10,409,766

Expenditures:

Agency and other accounts $ 56,122 $ 163,898 $ 52,923 $ 40,918 $ 42,940

Principal payment 35,949,182 3,172,837 3,566,492 3,690,878 51,862,452

Interest 5,454,753 5,733,379 5,892,020 5,763,433 5,744,790

Sewer Special Obligation debt service* 1,518,584 1,517,163 1,515,164 1,515,196 1,513,723

Professional fees 6,330,887 95,027 6,785 24,121 11,488

Total expenditures $49,309,528 $10,682,304 $11,033,384 $11,034,546 $59,175,393

Deficit of revenues under expenditures (113,239) (1,412,752) (946,978) (736,318) (48,765,627)

Other Financing Sources-Refunding Bonds - - - - 48,667,076

Deficit of revenues and contributions under

expenditures and other financing sources (113,239) (1,412,752) (946,978) (736,318) (98,551)

Fund balance, beginning of year: 7,107,528 6,994,289 5,581,537 4,634,559 3,898,242

Fund balance, end of year $6,994,289 $5,581,537 $4,634,559 $3,898,242 $3,799,690

This redevelopment levy is used to pay bond and interest payments on Redevelopment Bonds. The levy for 2008 and 2009 was 0.894 cents per $100 of

taxable valuation. The levy for 2010, 2011 and 2012 is 1.594 cents. The State Development Law authorizes a taxing authority of 2.6 cents on each $100

upon actual value of all taxable property in the City. The Omaha Special Tax Revenue Redevelopment and Special Obligation Debt Service Fund services

the following issuances:

Name Maturity Date

Performing Arts Redevelopment 2004** 2014

Special Tax Revenue Redevelopment 2007 2027

Special Tax & Tax Allocation Revenue Redevelopment 2007 A 2016

2008 Redevelopment Refunding (Stockyards & Downtown) 2013

2008 Special Obligation Refunding ( Riverfront ) 2026

Special Tax Revenue Redevelopment 2008* 2028

Special Tax Revenue Redevelopment 2009 A 2029

2012 Special Obligation Refunding (Riverfront)* 2032

Special Tax Revenue Redevelopment Refunding Series 2012A 2032

Special Tax Revenue Redevelopment Refunding Series 2012B 2018

Performing Arts Refunding Redevelopment 2012 2024

The 2012 Special Obligation Refunding Bonds and the 2008 Special Obligation Refunding Bonds are serviced by a variety of revenue sources including Property Tax Revenue,

Tax Allocation Revenue, State Cigarette Tax, NRD Miller Park Contribution, Douglas County Miller Park Contribution, Sewer Fees and Land Sales.

*The debt service for the sewer-related portion of the 2008 and 2012 Special Obligation Bonds is paid directly from the Sewer Revenue Enterprise Fund.

**The City recently refunded the principal amount of this issue with the Performing Arts Refunding Redevelopment Bonds 2012 listed above. The bonds of this issue maturing

in 2013 and 2014 will be paid at maturity.

B-5

CITY OF OMAHA, NEBRASKA SUMMARY OF GENERAL FUND REVENUES AND EXPENDITURES

THROUGH JUNE 30, 2013

2013 Actual Projected Projected Over

Budgeted 6/30/2013 12/31/2013 (Under) Budget

Revenues:

General Property Tax $79,089,535 $45,565,135 $79,089,535 $ -

Motor Vehicle Taxes 9,408,238 4,328,996 10,189,122 780,884

City Sales and Use Tax 135,461,322 63,891,525 128,144,631 (7,316,691)

Business Taxes 35,893,995 14,964,215 33,997,039 (1,896,956)

Restaurant Tax 25,645,594 9,377,816 25,260,910 (384,684)

Tobacco Tax - 1,164,459 2,498,596 2,498,596

Licenses and Permits 8,393,549 4,955,808 8,674,559 281,010

Intergovernmental Revenues 4,551,742 1,665,675 5,366,412 814,670

Charges for Services 17,004,178 7,632,573 16,990,050 (14,128)

Investment Income 1,175,000 330,789 700,000 (475,000)

Miscellaneous Other Revenue 2,396,075 630,025 2,823,675 427,600

Prior Year General Fund Balance 2,714,312 2,714,312 2,714,312 -

Total General Fund Revenue $321,733,540 $157,221,328 $316,448,841 $(5,284,699)

Expenditures:

Legislative & Executive $2,947,195 $1,400,230 $2,876,048 $(71,147)

Law, Personnel & Human Relations 6,542,841 3,022,528 6,278,902 (263,939)

Finance 3,310,805 1,486,355 3,181,197 (129,608)

Planning 7,277,275 3,309,133 6,916,671 (360,604)

Parks, Recreation & Public Property 18,708,414 8,395,014 18,355,424 (352,990)

Fire 82,392,215 43,233,832 88,900,358 6,508,143

Police 121,272,730 55,531,576 118,836,991 (2,435,739)

Public Works 19,215,341 8,958,605 17,917,210 (1,298,131)

Public Library & Convention & Tourism 9,790,614 5,041,652 9,302,279 (488,335)

Benefits 22,394,480 8,346,060 20,526,764 (1,867,716)

Outside Agency Accounts 20,422,870 5,385,423 21,443,759 1,020,889

Contingency and Other Accounts 7,458,760 1,840,139 7,218,710 (240,050)

Total General Fund Expenditures $321,733,540 $145,950,547 $321,754,313 $20,773

Excess Revenues over Expenditures

(5,305,472)

Projected 2013 General Fund Budget Carryover Reserve $(5,305,472)

Source: Unaudited records and projections of the Finance Department, City of Omaha as of June 30, 2013. These records and projections have not been

reviewed by the City's outside auditors: projections are projections only. Actual results based on the 2013 year-end audit may differ significantly.

B-6

CITY OF OMAHA, NEBRASKA GENERAL FUND

FISCAL YEAR 2013 BUDGET AND 2014 BUDGET

2013 2014

Budget Budget

Revenues:

Property Tax $ 79,089,535 $ 78,934,554

Motor Vehicle Tax 9,408,238 9,750,000

City Sales Tax (netted against LB 775) 135,461,322 135,404,522

Business Tax 35,893,995 39,757,243

Licenses and Permits 8,393,549 8,365,000

Intergovernmental Revenues 4,676,742 4,690,000

Charges for Service 17,129,778 24,778,609

Investment Income 1,175,000 800,000

Rents & Royalties 631,600 166,000

Restaurant Tax 25,645,594 27,677,874

Miscellaneous 1,513,875 833,000

Initial Credit 2,714,312 9,360,317

Total Revenue $ 321,733,540 $ 340,517,119

Expenditures:

Legislative & Executive $ 2,947,195 $ 2,855,491

Law, Human Resources & Human Relations 6,544,474 6,419,514

Finance 3,310,805 3,472,178

Planning 7,277,275 7,431,055

Police 121,272,730 124,148,422

Fire 70,575,115 90,615,765

Parks, Recreation and Public Property 18,708,414 18,625,727

Public Works 19,215,341 18,792,599

Library 9,290,614 10,464,250

Convention and Tourism 500,000 400,000

Other Budgetary Accounts - Benefits 22,394,480 21,843,823

Other Budgetary Accounts - Other 34,289,736 29,225,400

Other Budgetary Accounts - Debt Service 5,407,361 6,222,895

Total Expenditures $ 321,733,540 $ 340,517,119

The major portion of the City's day-to-day operations, some annual Capital Improvements, and various

lease-purchase agreements are financed by the General Fund. Appropriations are also made from the

fund for operating the Public Library System. Further appropriations are provided for the City's

contribution to employee benefit plans including pension systems, hospitalization and life insurance,

and social security taxes.

2014 Budget projections anticipate an increase of $18,783,579 over the 2013 budget, or an increase of

5.84%.

B-7

DEBT SERVICE REQUIREMENTS

The annual debt service requirements on all outstanding City of Omaha general obligation bonds,

as of January 1, 2013, net of the debt service requirements on the Refunded Bonds, are shown below,

together with the annual debt service requirements on the City of Omaha Various Purpose and Refunding

Bonds, Series 2013A.

Debt Service

on

Outstanding

Bonds after

Refunding Plus Debt Service on Various Purpose and

Refunding Bonds, Series 2013A

For Year

Ending

December

31

Total

Principal

and Interest

Principal Interest

Total

Principal

and Interest

Total Debt

Service

2013 $63,336,630 $ 0.00 $ 0.00 $ 0.00 $ 63,336,630

2014 58,384,025 2,720,000 993,962 3,713,962 62,097,987

2015 55,816,391 3,460,000 793,281 4,253,281 60,069,673

2016 54,410,688 2,780,000 689,481 3,469,481 57,880,169

2017 52,514,984 1,550,000 606,081 2,156,081 54,671,065

2018 48,409,979 1,495,000 563,456 2,058,456 50,468,435

2019 45,993,544 1,525,000 531,056 2,056,056 48,049,600

2020 44,252,218 1,415,000 485,306 1,900,306 46,152,524

2021 42,295,188 1,445,000 428,706 1,873,706 44,168,894

2022 40,631,372 715,000 370,906 1,085,906 41,717,279

2023 37,561,085 715,000 342,306 1,057,306 38,618,392

2024 35,713,615 715,000 313,706 1,028,706 36,742,321

2025 33,189,812 715,000 285,106 1,000,106 34,189,918

2026 28,981,380 715,000 256,506 971,506 29,952,886

2027 27,367,698 715,000 231,481 946,481 28,314,180

2028 5,511,436 715,000 195,731 910,731 6,422,167

2029 4,459,937 715,000 163,556 878,556 5,338,493

2030 3,083,825 715,000 131,381 846,381 3,930,206

2031 1,979,119 715,000 98,313 813,313 2,792,431

2032 1,239,088 715,000 64,350 779,350 2,018,438

2033 0.00 715,000 30,388 745,388 745,388

TOTALS $685,132,013 $24,970,000 $7,575,062 $32,545,062 $717,677,075

B-8

PROPERTY VALUATIONS AND DEBT RATIOS

As of December 31, 2012

2009 2010 2011 2012

Actual Valuation $27,077,712,200 $26,889,903,480 $27,483,461,735 $27,913,680,440

Net Direct General

Obligation Bonded

Debt $532,339,481 $509,486,524 $500,154,602 $498,105,711

% of Net Direct General

Obligation Bonded Debt

to Actual Valuation 1.97% 1.89% 1.82% 1.78%

Source: Records of Accounting Department, Office of the Douglas County Clerk.

Population, Net General Bonded Debt and Per Capita Debt

Year Population1

Net Direct

General Obligation

Bonded Debt2,3

Per Capita

Net Direct

General Obligation

Bonded Debt

1950

1960

1970

1980

1990

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

251,117

301,598

346,929

313,911

335,795

390,007

404,516

408,202

412,679

417,702

423,255

428,263

432,791

438,791

454,731

409,850

416,855

419,041

$ 11,100,500

30,697,871

71,586,248

73,939,298

115,435,013

408,103,671

423,338,935

417,421,740

421,869,470

439,551,010

465,864,465

464,368,152

520,334,932

539,312,795

532,339,481

509,486,524

500,154,602

498,105,711

$ 44.00

102.00

206.00

236.00

344.00

1,046.00

1,047.00

1,023.00

1,022.00

1,052.00

1,101.00

1,084.00

1,202.00

1,229.00

1,171.00

1,246.00

1,200.00

1,189.00 1Source: United States Census and Metropolitan Area Planning Agency, City of Omaha. 2Records of the Finance Department, City of Omaha. 3In 1982, the City of Omaha inaugurated a new annexation policy. The current annexation policy is designed to create annual,

balanced annexation packages and establish consistency from year to year. Such annexation packages combine areas with

relatively high outstanding indebtedness in relation to assessed valuation with other areas that have a more positive financial

picture. These balanced packages can then be added to the City without tax increase to cover retirement of the additional debt

assumed by the City. Under this approach, Omaha has grown by approximately 105,130 people and 41 square miles as a result

of annexations since 1980.

B-9

OVERLAPPING DEBT

Listed below are the political subdivisions which have the power to levy taxes and the amount of

net bonded indebtedness of each, as reported to the State of Nebraska Auditor of Public Accounts on

December 17, 2012, applicable to the taxable property within the City of Omaha:

Bonds Outstanding % Applicable to

City of Omaha

Amount

Applicable

Douglas County1 $ 70,185,000 76.25% $ 53,516,062

Omaha-Douglas Public Building Commission2 34,770,000 76.25 26,512,125

School District of Omaha3 264,281,949 85.91 227,044,622

School District of Ralston3 27,449,600 72.78 19,977,818

School District of Millard3 127,665,000 62.65 79,982,122

School District of Elkhorn3 141,895,000 49.24 69,869,098

Westside Community Schools 23,745,000 100.00 23,745,000

Total $689,991,549 $500,646,847

1 Douglas County, under various lease purchase agreements, is obligated to provide for annual rental payments. The annual

payments on those lease purchase agreements, mostly short-term, are in each case $500,000 or less. 2 Payable from certain property tax revenues and payments to be made to it by the City of Omaha and Douglas County under

certain contractual agreements. Actual rental payments by the City for 2012 were $1,583,353. The Act authorizing issuance of

bonds by the Omaha-Douglas Public Building Commission (the “Commission”) permits the Commission to levy a tax of $0.017

per $100 of actual valuation on all the taxable property in Douglas County; the levy for 2012-13 is $0.013 per $100 of actual

valuation. However, although the same Act authorizes the City to levy a tax on all the taxable property in the City, except

intangible property, of $0.017 per $100 of actual valuation in excess of the Charter limitation described under “AUTHORITY TO

LEVY TAXES,” if and to the extent necessary to make the City’s payments to the Commission, no such levy has ever been made

by the City for such purpose. 3 Tax levies for general obligation bond sinking fund purposes are unlimited as to amount. Residents of the City reside in one of

the five school districts and pay taxes only to that school district and the Learning Community. These numbers represent bonds

outstanding as of August 31, 2012.

The City’s ratio of direct and overlapping debt ($1,056,211,230) to its 2012 property valuation

($27,913,680,440) is 3.78%.

LONG-TERM CONTRACTUAL AGREEMENTS

The City of Omaha, under certain existing contractual agreements (including lease purchase

agreements), is obligated to provide for annual payments which are a charge on the General Fund and the

Parking Revenue Fund. From 2013 to 2036, the highest annual payment is $16,640,589 (in 2014), the

lowest is $7,435,015 (in 2036), and the average annual payment is $10,846,645. Such annual payments

are included as General Fund budgetary items for which annual appropriations are required. Under the

Charter of the City of Omaha, the outstanding amount of any lease purchase agreements executed by the

City as vendee or as lessee is not chargeable against the City debt limit.

B-10

City of Omaha and Local Authorities and Districts

Revenue and Special Obligation Bonds Outstanding1

as of December 31, 2012

City of Omaha:

Tax Increment Bonds and Notes $ 305,094,734

Special Tax Revenue Bonds 40,580,000

Highway Allocation Revenue Bonds 1,675,000

Convention Center Hotel Revenue Bonds 145,325,000

Special Obligation Bonds* 76,685,000

Omaha Public Power District 2,052,783,000

Airport Authority of the City of Omaha 23,940,375

Sanitary Sewerage System Revenue Bonds 212,040,000

Nebraska Department of Environmental Control Sewer Revenue Notes 13,071,421

Metropolitan Utilities District 180,601,259 _______________________ 1Revenue bond indebtedness is not general obligation debt of the City. Principal and interest are paid solely from revenues

arising from operations of the respective City facilities or of the Authority or District issuing such revenue bonds. No taxes are

levied for payment of either principal or interest. Nor are the Tax Increment Bonds and Notes and Special Tax Revenue Bonds

referred to above general obligations of the City. Principal and interest are paid (1) either from that portion of the ad valorem tax

on real property in a redevelopment project which is in excess of that portion of the ad valorem tax upon real property in such

redevelopment project produced by the levy at the rate fixed each year by or for each public body levying a tax in such

redevelopment project on the valuation for assessment of the taxable real property as last certified for the year prior to the

providing for division of such taxes pursuant to the redevelopment plan or (2) from special tax revenues collected pursuant to

redevelopment laws. *Including $17,252,935 principal amount payable from sewer revenues.

B-11

TOTAL PROPERTY TAX LEVIES IN THE CITY OF OMAHA

(Levied on Real and Tangible Personal Property)

2008 2009 2010 2011 2012 2013

City of Omaha

Amount per $100 of actual Valuation

(Rounded to four decimals)

General Fund $.2431 $.2431 $.2611 $.2845 $.2845 $.2845

Debt Service Fund .1759 .1759 .1759 .1928 .1928 .1928

Judgment Fund .0060 .0060 .0060 .0060 .0060 .0060

Redevelopment Fund .0089 .0089 .0089 .0159 .0159 .0159

Total for City of Omaha $.4339 $.4339 $.4759 $.4992 $.4992 $.4992

2008-09 2009-10 2010-11 2011-12 2012-13

(Amount per $100 of actual Valuation)

Other Taxing Units

Douglas County $ 0.24519 $ 0.26459 $ 0.26459 $ 0.26459 $ 0.26459

Library-(Unincorporated Areas Only) 0.01807 0.01553 0.01927 0.04791 0.00000

School District of Omaha1 1.20064 0.25572 0.25863 0.25909 0.25465

School District No. 66 of Douglas County1 1.25302 0.29106 0.32890 0.32890 0.35063

School District of Ralston1 1.29738 0.30785 0.32470 0.31280 0.32409

School District of Millard1 1.20997 0.25000 0.26000 0.26000 0.26000

School District of Elkhorn1 1.30499 0.34499 0.36500 0.36499 0.36499

State Educational Service Units2 0.01500 0.01500 0.01500 0.01500 0.01500

Omaha-Douglas Public Building

Commission 0.01300 0.01300 0.01300 0.01300 0.01300

Papio Missouri River Natural Resources

District 0.03375 0.03375 0.03275 0.03275 0.03275

Metropolitan Technical Community College 0.06740 0.08500 0.08500 0.08500 0.08500

Omaha Transit Authority 0.04613 0.04674 0.04872 0.04933 0.05027

Learning Community General3 - 0.96500 0.95125 0.96000 0.95000

Elementary Learning Center - 0.00000 0.00000 0.00000 0.10000

1Residents in Omaha reside in one of the above five school districts and pay taxes only to that school district. 2Residents residing in school districts other than the School District of Omaha pay $0.01606 for years 2012-2013, $0.01609 for years 2011-2012,

$0.01618 for years 2009-10, $0.01642 for years 2008-09 and $0.01629 for years 2007-08. 3Comprised of all 11 school districts within Douglas and Sarpy Counties, the Learning Community implemented a common property tax levy among the 11 school districts with the purpose of helping distribute property tax revenue more evenly throughout the school districts in the area.

B-12

MAJOR TAXPAYERS

The following are firms located within the City of Omaha with real estate valuations in excess of

$25,000,000 as of June 27, 2013.

Taxpayer Value of Real Property

FIRST DATA RESOURCES INC $108,122,000

OAK VIEW MALL LLC 103,206,100

UNITED OF OMAHA LIFE INS 95,101,200

WESTROADS MALL LLC 92,602,800

168TH AND DODGE LP 90,337,700

NEBRASKA FURNITURE MART 66,198,500

IRET-MR9 LLC 54,360,600

COMMERCIAL FED SAV & LOAN 48,357,800

CLF LANDMARK OMAHA LLC 46,177,800

SFI LTD PARTNERSHIP 45,325,000

WAL-MART REAL ESTATE BUS TR 45,146,800

FIRST NATIONAL BANK OMAHA 44,258,000

TARGET CORPORATION 41,888,600

EM OMAHA OWNER LLC 40,368,700

ALEGENT HEALTH 40,098,100

WOODMEN OF THE WORLD LIFE INS 40,000,000

OMAHA PLAZA INVESTMENTS LLC 36,287,300

WACHOVIA DEVELOPMENT CO 35,524,000

CAGR LLC 34,761,700

BISHOP CLARKSON MEMORIAL HOSP 33,396,300

GUARANTEE MUTUAL LIFE 31,132,000

WELLS FARGO BANK NEBRASKA 31,074,300

WEST TELESERVICES CORP 30,500,000

OMAHA MARKETPLACE HOLDINGS LLC 30,451,200

WESTPLEX LIMITED PARTNERSHIP 30,060,300

CONNECTICUT NATL BANK TR 30,000,000

AIRLITE PLASTICS CO 29,921,600

CONAGRA FOODS INC 29,245,000

LOZIER CORP 29,151,000

REGENCY LAKESIDE ASSOC LLC 28,750,800

IRET PROPERTIES 28,652,300

WAL-MART REAL ESTATE BUSINESS 28,398,300

FIRST NATL OF NEBR INC 28,216,300

BUCKS INC 26,690,800

VK BLONDO PROPERTIES LP 25,890,300

WIESMAN DEVELOPMENT LLC 25,508,900

Source: Records of the Tax Control Supervisor, Office of the Douglas County Clerk

B-13

DEBT MANAGEMENT

General Obligation Debt Margin

Article V, Section 5.27, Home Rule Charter of the City of Omaha, 1956, as amended, provides:

The total amount of general obligation indebtedness outstanding at any time, which shall

include bonds issued but shall not include bonds authorized until they are issued, shall

not exceed 3.5 per cent of the actual value of taxable real and personal property in the

city.

Computation of the general obligation debt margin as defined in the Home Rule Charter, based

upon valuations, reflects the following:

Maximum debt limit (3.5% of total assessed valuation) $976,978,815

General obligation bonds outstanding 516,794,764

Less balance in General Obligation Debt

Service Fund December 31, 2012

(18,689,053) (498,105,711)

General obligation debt margin $478,873,104

Revenue bond indebtedness, special obligation bonds, general obligation notes and

lease-purchase agreements are not chargeable against the general obligation debt margin. The City of

Omaha has no general obligation notes outstanding. Revenue and special obligation bond indebtedness

and lease purchase agreement obligations are set forth herein under the captions “OVERLAPPING

DEBT” and “LONG-TERM CONTRACTUAL AGREEMENTS—City of Omaha and Local Authorities

and Districts Revenue and Special Obligation Bonds Outstanding.”

Debt Payment Record

The City of Omaha has never defaulted on its obligations to pay principal of or interest on its

indebtedness.

General Obligation Bonds Authorized But Unissued

Not including the applicable portion of the Bonds, the City has $68,371,000 of general obligation

bonds authorized but unissued which were approved by the City electorate on May 11, 2010. The City

anticipates that these bonds will be issued in varying amounts annually through 2016.

CASH RESERVE FUND

At a special City election held on November 6, 1984, voters of the City approved an amendment

to Section 5.03 of the City Charter to provide in subsection (10) for the establishment of a cash reserve

fund (“Cash Reserve Fund”) for the purpose of meeting emergencies arising from:

(a) the loss or partial loss of a revenue source;

(b) an unanticipated expenditure demand due to a natural disaster, casualty loss or

act of God;

B-14

(c) expenditure demand for the satisfaction of judgments and litigation expenses

when the Judgment Levy Fund balance is inadequate; or

(d) conditions wherein serious loss of life, health or property is threatened or has

occurred.

The 1984 amendment to the City Charter authorized the appropriation at the close of any fiscal

year for credit to the Cash Reserve Fund of any amount, or portion thereof, held as General Fund surplus.

Income earned on amounts credited to the Cash Reserve Fund is retained in the fund. The maximum size

of the Cash Reserve Fund was established at an amount equal to 4% of General Fund appropriations.

The ordinance adopted by the City Council to close Fiscal 1984 Accounts provided that the sum

of $1,600,000 be transferred from 1984 available budgetary balances as the initial credit to the Cash

Reserve Fund to be held as provided in Section 5.03(10) of the City Charter. In 2012, $750,000 was

appropriated from the General Fund, leaving the balance as of December 31, 2012 of $4,044,945.

EMPLOYEE RELATIONS: RETIREMENT SYSTEMS

General

The City of Omaha negotiates with four major unions: The Civilian Management Professional

and Technical Employees Council; The Omaha City Employees, Local No. 251; The Omaha Association

of Firefighters, Local No. 385 (the “Fire Union”); and The Omaha Police Union, Local No. 1 (the “Police

Union”). Current agreements with the four unions expire or expired as follows: The Civilian

Management Professional and Technical Employees Council—December 22, 2012; Fire Union—

December 20, 2014; Omaha City Employees, Local No. 251—December 22, 2012; and Police Union,—

December 21, 2013. See “CITY OF OMAHA EMPLOYEES’ RETIREMENT SYSTEM—Current

Developments” regarding the status of contract negotiations between the City and the civilian bargaining

groups.

The negotiating procedure involves meeting with the designated union representatives and

discussing economic and noneconomic items regarding contractual agreements. At any time, should an

impasse be reached, Nebraska law provides that either party may appeal to the Nebraska Commission of

Industrial Relations. Either party may appeal the decision of such Commission to the Nebraska Supreme

Court, whose decision is final.

Investors should note that (i) the information included in herein relating to the City’s Uniform

Plan and Civilian Plan (each as hereinafter defined) relies on information produced by Cavanaugh

Macdonald Consulting, LLC (the “Actuary”), (ii) actuarial assessments are “forward-looking”

information that reflect the judgment of the fiduciaries of the plans, and (iii) actuarial assessments are

based upon a variety of assumptions, one or more of which may prove to be inaccurate or be changed in

the future, and will change with the future experience of plans. The City engaged Cavanaugh Macdonald

Consulting, LLC in 2011 pursuant to a request for proposal process. Cavanaugh replaced Milliman

Consultants and Actuaries as the City’s actuary as of that date.

Actuarial Methods and Assumptions

Valuations of the plans use the “entry age-normal” cost method. Under this actuarial method, the

value of future costs attributable to future employment of participants is determined. The value of future

costs attributable to past employment of participants, which is called the actuarial liability, is equal to the

present value of benefits less the present value of future normal costs. The unfunded actuarial liability is

B-15

equal to the excess of the actuarial liability over assets. The unfunded actuarial liability is funded as a

level percent of payroll over a 30-year closed period that began—in regards to the Civilian Plan on

January 1, 2002 and in regards to the Uniform Plan on January 1, 2003. The City’s annual Civilian Plan

and Uniform Plan expenses are calculated based on the annual required contribution of the employer

(“ARC”), an amount actuarially determined in accordance with the parameters of GASB 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 30 years.

As experience develops with the plans, actuarial gains and actuarial losses result. These actuarial

gains and losses indicate the extent to which actual experience is deviating from that expected on the

basis of the actuarial assumptions. In each year, as they occur, actuarial gains and losses are recognized

in the unfunded actuarial liability as of the actuarial valuation date.

The plans use an asset-smoothing method in the actuarial valuation process. As a result, each

plan’s funded status and the targeted contribution are based on the actuarial (smoothed) value of assets –

not the actual market value. See the two tables below for a comparison of each plan’s Market Value of

Assets to its Actuarial Value of Assets.

CIVILIAN PLAN

Date Market Value of

Assets (MVA)

Actuarial Value of

Assets (AVA)

AVA /

MVA

1/1/2008 $294,658,022 $283,243,750 96.13%

1/1/2009 204,452,506 245,343,007 120.00%

1/1/2010 213,219,632 240,109,413 112.61%

1/1/2011 232,346,583 240,291,310 103.42%

1/1/2012 215,434,784 236,741,347 109.89%

1/1/2013 223,233,088 235,591,941 105.54%

UNIFORM PLAN

Date Market Value of

Assets (MVA)

Actuarial Value of

Assets (AVA)

AVA /

MVA 1/1/2008 $529,923,390 $530,493,413 100.1%

1/1/2009 365,923,877 439,108,652 120.0%

1/1/2010 405,390,038 440,478,409 108.7%

1/1/2011 452,640,303 456,158,774 100.8%

1/1/2012 440,429,392 467,375,458 106.1%

CITY OF OMAHA EMPLOYEES’ RETIREMENT SYSTEM

The City of Omaha Employees’ Retirement System (the “Civilian Plan”) became effective on

January 1, 1949. Certain of its provisions, which are governed by Chapter 22.21 of the Omaha Municipal

Code, are summarized herein. The Civilian Plan is a single-employer defined benefit plan with a fiscal

year that ends December 31. Under the Civilian Plan, there are 1,152 active members, 1,002 retirees,

272 beneficiaries, 84 disabled members and 75 deferred vested members for a total of 2,585.

B-16

All city employees except the following are covered by the Civilian Plan: police; firefighters;

persons paid on a contractual or fee basis; seasonal, temporary and part-time employees; and elected

officials who do not make written application to the Civilian Plan. Prior service credit is granted for

employment with the City before January 1, 1949, and membership service credit is granted for

employment thereafter. Compulsory military duty and voluntary military duty in time of war count as

service.

Early retirement is permitted at age 50 with five years of service, with the accrued benefit

reduced 8% per year for retirement prior to age 60. For employees whose age plus service equals or

exceeds 80, the 8% per year reduction is eliminated. An employee’s monthly pension is equal to

2.25% of average final monthly compensation for each year of service.

The historical City contributions are as follows:

Fiscal Year

Ending

Annual Required

Contribution

(ARC)

(a)

Total Employer

Contribution

(b)

% of ARC

Contributed

(b/a)

12/31/2005 $6,877,913 $4,500,192 65.43%

12/31/2006 6,213,801 4,145,033 66.71%

12/31/2007 8,883,617 4,975,039 56.00%

12/31/2008 9,212,669 5,374,082 58.33%

12/31/2009 12,893,331 5,310,754 41.19%

12/31/2010 14,149,386 5,717,610 40.41%

12/31/2011 14,564,847 6,618,110 45.44%

12/31/2012 15,658,045 7,216,050 46.09%

Notes Regarding the above table: (1) The actuarial value of assets is determined based on a method that smoothes the effects of

short term volatility in the market value of investments. The actuarial value is equal to the expected value, based on the assumed

rate of return, plus 25% of the difference between market and expected values. A corridor of 80% to 120% of market value is

also applied; (2) Economic assumptions are as follows: (a) Investment return rate: 8.00%, (b) Salary increase rates: from 10% at

1 year of service to 4% at 20 years of service, (c) Inflation rate: 3.5%, (d) Payroll growth: 4.00%, (e) Post-retirement benefit

increases: Applicable after 5 years equal to the lesser of 3% or $50 per month for members (and their beneficiaries) who retired

on or before January 28, 1998; and (3) The amortization method is a closed 30-year period, level percentage of payroll (the

unfunded actuarial liability is amortized over 19 years as of January 1, 2013).

[Remainder of Page Intentionally Left Blank]

B-17

Following is a cash flow analysis of the Civilian Plan for the last five fiscal years:

2008 2009 2010 2011 2012

Receipts

Employee Contributions $ 4,695,162 $ 4,638,593 $ 4,858,097 $5,628,888 $6,201,924

Employer Contributions 5,374,082 5,310,754 5,717,610 6,618,110 7,216,050

Investment Income (74,148,690) 25,385,457 36,420,500 (401,034) 24,485,826

Security Lending Income 131,023 151,792 29,994 16,808 44,131

Total Receipts $(63,948,423) $35,489,596 $47,026,201 $11,862,772 $37,947,931

Disbursements

Retirement Pensions $23,359,337 $24,583,957 $25,956,829 $26,789,295 $28,024,628

Death Benefits 256,610 149,633 175,000 148,333 201,667

Refunds 327,075 514,398 205,017 387,696 557,950

Other Disbursements 1,750,227 1,474,483 1,562,403 1,448,974 1,365,382

Total Disbursements 25,693,249 26,722,470 27,899,249 28,774,572 30,149,626

Excess of Receipts

Over Disbursements $(89,641,672) $ 8,767,126 $ 19,126,952 $(16,911,800) $7,798,304

Source: Records of Finance Department, City of Omaha.

Funding Status

Strong investment performance in 2009 and 2010 has helped reduce the deferred investment loss

from the 2008 fiscal year. However, despite returns in both 2009 and 2010 that were higher than the

expected return of 8%, the actuarial value of assets on January 1, 2012 was $21 million greater than the

market value of assets on the same date. The funded ratio of the Civilian Plan, on a market value basis,

has decreased from 52% in the January 1, 2009 actuarial valuation to 51.0% in the January 1, 2013

valuation. The Civilian Plan faces a significant challenge, as more fully discussed in the second

succeeding paragraph and under “Current Developments”, based on the contribution shortfall between the

actuarial contribution rate and the current fixed member and employer contribution rates.

The actuarial contribution rate of the Civilian Plan is composed of two parts:

(1) The normal cost (which is the allocation of costs attributed to the current year’s

membership service); and

(2) The amortization payment on the Unfunded Actuarial Liability.

The normal cost rate is independent of the Civilian Plan’s funded status and represents the cost,

as a percent of payroll, of the benefits provided by the Civilian Plan which is allocated to the current year

of service. The total normal cost for the Civilian Plan is 13.716% of pay, or about $8.0 million in the

2012 fiscal year. When offset by the expected employee contributions, the City portion of the normal

cost is 3.655% of pay, or about $2.2million. The normal cost represents the long-term cost of the benefit

structure of the Civilian Plan.

B-18

The Civilian Plan’s total actuarially determined contribution rate (payable as a percentage of

member payroll) increased by 2.563% of pay, to 37.561% on January 1, 2013, from 34.998% on

January 1, 2012. The Civilian Plan has an unfunded actuarial liability (“UAL”) of $201 million (actuarial

liability is greater than actuarial assets). The UAL is being funded over a closed 30-year period beginning

January 1, 2002 of which 19 years remain as of the valuation date. The resulting UAL payment is

23.831% of pay. As a result, the total contribution for 2013 is 37.561% of pay (13.730% + 23.831% The

City’s required contribution rate in the city ordinance for 2013 is 11.775% and the employees

contribution rate is 10.075%, which results in a contribution shortfall for 2013 of 15.711% of pay. Based

on the projections in the actuarial study and in light of the City’s and employees’ contribution shortfalls,

the Civilian Plan will not achieve full funding in the absence of negotiated changes to the Civilian Plan’s

funding rates or benefits package. See “CITY OF OMAHA EMPLOYEES’ RETIREMENT SYSTEM –

Current Developments.”

The latest Civilian Plan actuarial study by the Actuary was for the period ended January 1, 2013

and included an 8.0% investment rate of return assumption. The City expects the Actuary to prepare an

annual actuarial study updating the information herein. Summarized below is financial information

concerning the Civilian Plan for the last six fiscal years.

Actuarial

Valuation Date1

Market Value of

Assets2

(a)

Actuarial

Liability (AAL)

(b)

Unfunded AAL

(UAAL)

(b-a)

Funded Ratio

(a / b)

Covered Payroll

(P / R)

(c)

UAAL as a

Percentage of

Covered P / R

[(b-a) / c] 12/31/2008 $204,500,000 $387,700,000 $183,200,000 52.7% $56,400,000 324.8%

12/31/2009 213,200,000 402,800,000 189,600,000 52.9% 55,700,000 340.4%

12/31/2010 232,400,000 414,500,000 182,100,000 56.1% 56,700,000 321.2%

1/1/2011 240,291,310 409,442,601 169,151,291 58.7% 59,235,591 285.6%

1/1/2012 236,741,347 420,810,359 184,069,012 56.3% 62,825,685 293.0%

1/1/2013 235,591,941 436,270,409 200,678,468 54.0% 63,327,394 316.9%

(1) Results prior to 2011 were provided by the City’s prior actuary and were reported at the end of the year rather than the valuation date.

(2) The prior actuary reported the market value of assets in column (a). The Actuary applied the valuation date methodology for GASB calculations to the

extent the methodology complies with GASB 25 parameters. Information reported as of 1/1/2011 and later accordingly reflects the valuation methodology including the actuarial value of assets.

The City’s annual pension cost and net pension obligation to the Civilian Plan for the fiscal year

ended December 31, 2012 are as follows:

City of Omaha Employees’ Retirement System

Annual Pension Cost and Net Pension Obligation

December 31, 2012

Annual required contribution (ARC) $ 15,658,045

Interest on net pension asset 3,322,571

Adjustment to annual required contribution (3,016,754)

Annual pension cost 15,963,862

Contributions made (7,216,050)

Increase in net pension obligation 8,747,812

Net pension obligation, beginning of year 41,532,143

Net pension obligation, end of year $50,279,955

B-19

Three-year trend information is as follows:

Fiscal

Year

Ending

Annual

Required

Contribution

(ARC)

Percentage

of ARC

Contributed

Net

Pension

Obligation

12/31/2012 $15,658,045 46% $50,279,955

12/31/2011 $14,564,847 45% $41,532,143

12/31/2010 $14,149,386 41% $32,263,609

Asset Allocation

The Pension Board of the Civilian Plan with the recommendation from its investment committee

approves fund manager agreements. Such management agreements provide specific investment

requirements. Updated investment guidelines were adopted by the Civilian Plan in February 2011.

Under the Civilian Plan’s investment guidelines the target range for fixed income assets is between 12%

and 28% of the portfolio value; equity investments shall be 25.5 – 54.0% of the portfolio with large cap

domestics (6.5 – 13.5%), small cap domestics (9.6 – 20.0%), and international equities (9.5 – 20.5%).

Domestic real estate securities shall be 9.5 – 20.5% of the portfolio. The investments may be held

individually or commingled in mutual funds and investment pools. There are no individual investments

greater than 5% with a single issuer. See the table below for a breakdown of investment type and

accompanying asset value:

Investment Type

Market Value

12/31/2012 Percent Allocated

Government Securities $20,278,557 8.60%

Municipal Issues 1,409,593 0.63%

Corporate Bonds 21,076,921 9.40%

Domestic Equities 67,886,568 30.27%

International Equities 36,006,318 16.06%

Domestic Real Estate Securities 36,980,630 16.49%

Commodities 22,342,786 9.96%

Private Equity 12,059,269 5.38%

Cash and Cash Equivalents 6,200,110 2.76%

Total $224,240,753 100.0%

[Remainder of Page Intentionally Left Blank]

B-20

Fixed income investments are held in two accounts managed by two different managers:

$34.8 million in managed accounts and $10.7 million in one bond mutual fund. Maturities of the

securities in these commingled funds as of December 31, 2012 are as follows:

Managed Accounts

Maturity Range (Years)

Investment Type Less than 1

year

1-5 6-10 10+

U.S. Treasuries 0.0% 10.0% 7.2% 7.2%

U.S. Agencies 0.4% 14.4% 2.3% 0.3%

Municipal Bonds 0.0% 0.00% 2.2% 1.8%

Corporate Bonds 1.6% 19.2% 22.0% 11.4%

Bond Mutual Funds

Maturity Percent of Total

0-1 years 27.8%

1-5 years 72.2%

6-10 years --

10+ years --

The credit quality ratings of the securities in these two fixed income asset funds as of

December 31, 2012 are as follows:

Managed Accounts

Investment Type Ratings Percent of Total

U.S. Treasuries AAA 9.5%

U.S. Agencies AAA/AA+ 10.0%

Municipal Bonds AAA/A3 2.8%

Corporate Bonds AAA/A3 21.4%

U.S. Agencies BAA1/BBB 1.4%

Corporate Bonds BAA1/BBB 47.9%

Corporate Bonds N/R 7.0%

Bond Mutual Funds

Rating Percent of Total

TSY/AGY 41.5%

AAA/Aaa 39.3%

AA+/A3 15.0%

BBB/Ba2 4.0%

N/R 0.2%

Current Developments

In regard to the Civilian Plan, contribution rates for both the employees and the City were

increased through December 22, 2012. The City and the civilian bargaining groups are continuing to

negotiate solutions to address the Civilian Plan’s unfunded actuarial accrued liability. It is expected that

new contract provisions beginning in 2013 will provide additional funding to the Civilian Plan. The 2014

Budget of the City includes an additional 5% City contribution to the Civilian Plan in 2014.

B-21

POLICE AND FIRE RETIREMENT SYSTEM

The City of Omaha Police and Fire Retirement System (the “Uniform Plan”) became effective on

July 1, 1961. Certain of its provisions, which are governed by Chapter 22.61 of the Omaha Municipal

Code, are summarized herein. The Uniform Plan is a single-employer defined benefit plan with a fiscal

year that ends December 31. Under the Uniform Plan, there are 1,411 active members, 947 retirees,

393 beneficiaries, 237 disabled members and 11 deferred vested members for a total of 2,844.

Membership in the Uniform Plan is limited to and shall include only probationary and regular

uniformed personnel of the Police and Fire Departments. Under the new December 2012 contract

between the City and the Fire Union, the minimum years of service required to qualify for a maximum

pension benefit of 75% of average monthly compensation increased by five years for existing sworn fire

personnel with less than 15 years of service. Additionally, the minimum years of service required for new

hires to qualify for the maximum pension benefit without penalty increased by 10 years from the old

contract and the maximum benefit for such new hires is now capped at 65% of average monthly

compensation. Further, new hires under the contract that retire prior to the age of 55 face a penalty on

their pension benefits. In regards to sworn fire personnel with more than 15 years of services at the time

of the new contract, the retirement qualifications remain as they were—with 25 years of service or more,

an employee can retire at the minimum age of 45 with a lifetime monthly retirement benefit equal to

75% of average final monthly compensation and with a minimum of 20 years of service, an employee can

retire at the age of 50 with a lifetime monthly service retirement benefit equal to 55% of average monthly

compensation. For sworn police personnel, under the September 2010 contract the minimum years of

service for a maximum pension benefit of 75% of average monthly compensation increased from 25 years

to 30 years. Additionally, under the new police contract sworn personnel hired after January 1, 2010, the

minimum age for a normal service retirement is 50. For current sworn police personnel, retirement is

optional at 45 with 20 years of service with a lifetime monthly service retirement benefit equal to 50% of

average monthly compensation. With 30 years of service or more, an employee can retire at the

minimum age of 45 with a lifetime monthly retirement benefit equal to 75% of average final monthly

compensation.

The historical City contributions are as follows:

Fiscal Year

Ending

Annual Required

Contribution

(ARC)

(a)

Total Employer

Contribution

(b)

% of ARC

Contributed

( b/a )

12/31/2005 $26,255,804 $17,762,209 67.65%

12/31/2006 31,102,053 20,171,610 64.86%

12/31/2007 34,842,280 20,699,211 59.41%

12/31/2008 38,073,021 21,700,806 57.00%

12/31/2009 50,507,561 22,701,608 44.95%

12/31/2010 55,488,062 24,183,493 43.58%

12/31/2011 49,945,979 30,775,568 61.62%

12/31/2012 54,310,693 35,302,037 65.00%

Notes Regarding this Schedule: (1) The actuarial value of assets is determined based on a method that smoothes the effects of short term volatility in the market value investments. The actuarial value is equal to the expected value, based on the assumed rate of return, plus 1/3 of the difference

between market and expected values. A corridor of 80% to 120% of market value is also applied; (2) Economic assumptions are as follows:

(a) Investment return rate: 8.00%, (b) Salary increase rates: from 6.5% at 1 year of service to 4% at 30 years of service, (c) Inflation rate: 3.5%, (d) Payroll growth: 4.00%, (e) Post-retirement benefit increases: the lesser of 3% or $50 ($65 for Fire retirements after June 30, 2007. The

increase will be made annually, beginning in the 13th month of retirement); and (3) The amortization method is a closed 30-year period, level

percentage of payroll (the unfunded actuarial liability is amortized over 21 years as of January 1, 2012).

B-22

Following is a cash flow analysis of the system for the last five fiscal years:

2008 2009 2010 2011 2012

Receipts

Employee Contributions $14,858,953 $15,630,476 $ 16,271,773 $16,916,367 $19,641,660

Employer Contributions 20,373,206 21,374,008 22,855,893 29,447,968 33,974,437

Prior Service Contributions 1,327,000 1,327,600 1,327,600 1,327,600 1,327,600

Investment Income (148,242,515) 57,038,628 66,701,848 1,473,016 57,435,625

Security Lending Income 448,804 174,265 187,065 108,677 96,605

($111,234,552) $95,544,975 $107,314,179 $49,273,627 $112,475,927

Disbursements

Retirement Pensions $49,426,367 $52,783,686 $55,911,664 $58,101,622 $59,622,531

Death Benefits 13,000 77,360 156,507 25,500 148,885

Refunds 221,824 296,230 520,997 295,730 585,861

Other Disbursements 3,103,770 2,921,538 3,474,746 3,061,687 2,747,902

52,764,961 56,078,815 60,063,914 61,484,538 63,105,179

Excess of Receipts

Over Disbursements

$(163,999,513) $39,466,161 $47,250,265 $(12,210,911) $49,370,748

Source: Records of Finance Department, City of Omaha.

Funding Status

Significant changes to the benefit structure for police members are reflected in the 2011

valuation. The police contract signed with the Police Union in September 2010 provided for significant

increases to the future contributions of both police members and the City to the Uniform Plan as well as

significant reductions to the benefit provisions for current and future police members which lowered the

cost of the Uniform Plan. The changes in the Uniform Plan provisions for police members resulted in a

decrease in the unfunded actuarial liability of $52 million and a decrease in the normal cost rate of 5.23%

(for police members). The contribution shortfall for 2011 fell to 18.71% from 28.16% in 2010. The

changes in the police contract are expected to produce a significant improvement in the sustainability of

the Uniform Plan over the long term. The full impact of the provisions of the new police contract are not

reflected in the 2011 valuation because some of the benefit changes are effective only for new hires and,

thus, will unfold over time as new hires replace current active members. As discussed above, the Fire

Union signed a new contract with the City in December 2012, which includes a commitment by the City

and the Fire Union to increase their contributions to the Uniform Plan to address the growing unfunded

liability of the Uniform Plan. While the City expects the new Fire Union contract to have similar impacts

as the renegotiated police contract, it is too early to measure the impact of these changes on the unfunded

liability of the Uniform Plan. The City will continue its underfunding of its ARC for the Uniform Plan,

which is funded as a level percent of payroll over a 30-year closed period that began in January 1, 2002.

Based on projections in the actuarial study and in light of the City’s and the police and fire members’

contribution rates, the Uniform Plan is expected to achieve full funding in about 45 years.

During 1977, on the basis of an actuarial balance sheet prepared as of January 1, 1977, the

District Court of Douglas County, Nebraska made a determination relative to the unfunded liability for

past service credits and the method of funding such amount. The City had adopted a policy whereby the

employer contributions each year exceeded the matching requirements and served to amortize in part the

B-23

past service costs. Commencing in 1979, the City contributes to the Uniform Plan the sum of

$1,327,600 per year for 50 years to provide for the amortization of the prior service cost.

The latest actuarial study by the Actuary was for the period ended January 1, 2012 and included

an 8.0% rate of return investment assumption. The City anticipates receiving the updated actuarial study

for the period ended January 1, 2013 at the end of September 2013. Going forward, the City expects the

Actuary to annually prepare an actuarial report updating the information included herein. Summarized

below is financial information concerning the Uniform Plan for the last six fiscal years.

Actuarial

Valuation

Date1

Market Value

of Assets2

(a)

Actuarial

Liability

(AAL)

(b)

Unfunded

AAL (UAAL)3

(b-a)

Funded Ratio

(a / b)

Covered

Payroll (P / R)

(c)

UAAL as a

Percentage of

Covered P / R

[(b-a) / c ] 12/31/2007 $530,800,000 $882,700,000 $351,900,000 60.1% $99,600,000 353.3%

12/31/2008 365,900,000 947,600,000 581,700,000 38.6% 99,500,000 584.6%

12/31/2009 405,400,000 1,026,200,000 620,800,000 39.5% 103,900,000 597.5%

12/31/2010 452,600,000 1,093,300,000 640,700,000 41.4% 111,200,000 576.2%

1/1/2011 456,158,774 1,028,866,353 572,707,579 44.3% 105,025,610 545.3%

1/1/2012 467,375,458 1,07,607,299 610,231,841 43.4% 110,027,537 554.6%

(1) Results prior to 2011 were provided by the City’s prior actuary and were reported at the end of the year rather than the valuation date.

(2) The prior actuary reported the market value of assets in column (a). The Actuary applied the valuation date methodology for GASB

calculations to the extent the methodology complies with GASB 25 parameters. Information reported as of 1/1/2011 and later accordingly

reflects the valuation methodology including the actuarial value of assets.

(3) As of 1/1/2011 the Present Value of Prior Service Payments is not reflected in the Unfunded AAL.

The City’s annual pension cost and net pension obligation to the Uniform Plan for the year ended

December 31, 2012 are as follows:

Police and Firemen’s Retirement System

Annual Pension Cost and Net Pension Obligation

December 31, 2012

Annual required contribution (ARC) $54,310,693

Interest on net pension obligation 11,185,815

Adjustment to annual required contribution (9,833,151)

Annual pension cost 55,663,357

Contributions made (35,302,037)

Increase in net pension obligation 20,361,320

Net pension obligation, beginning of year 139,822,693

Net pension obligation, end of year $160,184,013

Three-year trend information is as follows:

Fiscal

Year

Ending

Annual

Required Contribution

(ARC)

Percentage

of ARC

Contributed

Net

Pension

Obligation

12/31/2012 $54,310,693 65% $160,184,013

12/31/2011 $49,945,979 61% $139,822,693

12/31/2010 $55,488,062 44% $119,249,376

B-24

Asset Allocation

The Pension Board of the Uniform Plan with the recommendation from its investment committee

approves fund manager agreements. Such management agreements outline specific investment policies.

Updated investment guidelines were adopted by the Uniform Plan in February 2011. Under the Uniform

Plan’s investment guidelines the target range for fixed income assets is between 13% and 31% of the

portfolio value; equity investments shall be 33.0 – 71.0% of the portfolio with large cap domestics (13.0 –

27.0%), small cap domestics (6.0 – 14.0%), and international equities (14.0 – 30.0%). Domestic real

estate securities shall be 9.0 – 21.0% of the portfolio. The investments may be held individually or

commingled in mutual funds and investment pools. There are no individual investments greater than 5%

with a single issuer. See the table below for a breakdown of investment type and accompanying asset

value:

Investment Type

Market Value

12/31/2012 Percent Allocated

Government Securities $17,033,908 3.50%

Municipal Issues 2,469,565 0.51%

Corporate Bonds 96,448,882 19.83%

Domestic Equities 159,295,250 32.74%

International Equities 89,163,872 18.33%

Domestic Real Estate Securities 96,127,044 19.76%

International Real Estate 1,503,535 0.31%

Commodities 11,150,579 2.29%

Cash and Cash Equivalents 13,308,611 2.74%

Total $486,501,247 100.0%

Fixed income investments are held in three accounts managed by three separate managers:

$115.9 million in managed accounts. Maturities of the securities in these commingled funds as of

December 31, 2012 are as follows:

Managed Accounts

Maturity Range (Years)

Investment Type Less than 1

year

1-5 6-10 10+

U.S. Treasuries 0.0% 2.6% 1.1% 1.4%

U.S. Agencies 0.3% 3.5% 3.5% 2.3%

Municipal Bonds 0.2% 0.0% 1.0% 0.9%

Corporate Bonds 1.6% 32.0% 43.5% 6.1%

B-25

The credit quality ratings of the aforementioned three fixed income accounts as of December 31, 2012 are

as follows:

Managed Accounts

Investment Type Ratings Percent of Total

U.S. Treasuries AAA 5.1%

U.S. Agencies AAA/AA+ 8.1%

Municipal Bonds AAA/A3 1.9%

Corporate Bonds AAA/A3 16.5%

U.S. Agencies BAA1/BBB 1.5%

Corporate Bonds BAA1/BBB 57.8%

Corporate Bonds N/R 9.1%

Current Developments

The City and the Fire Union executed in 2012 a new contract for payroll years 2011 through

2014. In addition to the changes in benefits and increased contributions to the Uniform Plan, the new

contract increases the Fire Union’s share of health care and sets wages through 2014, with an average

wage increase of 1.6% annually for the term of the contract.

The Fire Union had been negotiating with the City from when its last contract expired at the end

of 2007 until December 2012. The new contract addressed payroll years 2011 and 2012, but did not

address 2008, 2009, and 2010. The Fire Union had filed several lawsuits against the City with the

Nebraska Commission of Industrial Relations (“CIR”) and the District Court of Douglas County,

Nebraska (the “District Court”) since the expiration of the prior contract. The wage cases for 2008, 2009,

and 2010 are complete and have been implemented; however, there is still pending litigation in regards to

implementation of the 2008 case with the same questions also affecting 2009 and 2010 and those are

addressed in the next paragraph.

The District Court issued Orders on two cases before it on January 12, 2012. In the first case,

Professional Firefighters Association of Omaha v. City of Omaha (No. 1095-998), the Fire Union

prevailed on its motion for summary judgment that the City must pay wages in accordance with City

Code 23-148 (relating to levels of wages by rank), a decision that the City estimates will cost between $2

million and $4 million when applied to wages for 2008 to 2011. However, the District Court in the same

Order granted the City’s motion for summary judgment against a Fire Union claim for back pay for

alleged understaffing of fire units. In the second case, Professional Firefighters Association of Omaha v.

City of Omaha (No. 1095-999), the Fire Union requested that the City be held in contempt for an alleged

failure to comply with various CIR orders. The District Court granted the City’s motion for summary

judgment against that request, but allowed the Fire Union to amend its original complaint to request an

accounting of appropriate back pay under CIR's 2008 Wage Order. The Fire Union has amended its

original complaint alleging the City failed to properly comply with the 2008 Wage Order of the CIR. On

March 20, 2013, an order was entered in Professional Firefighters Association of Omaha v. City of

Omaha (No. 1095-999) in which the District Court found in the City’s favor on five of seven counts and

found for the Fire Union on two of seven counts. It is estimated that the decision will result in the City

having to pay between $300,000 and $400,000 when applied to wages for 2008 to 2010. The Fire Union

has filed a third District Court lawsuit alleging the City has failed to make timely payments for 2009 back

pay. The City anticipates that the Fire Union will continue to pursue other remedies with respect to wage

claim matters for years 2008, 2009, and 2010.

B-26

OTHER POST EMPLOYMENT BENEFITS

Implementation of GASB Statements

The Government Accounting Standards Board (“GASB”) has issued Statements No. 43

(“GASB 43”), Financial Reporting for Post Employment Benefit Plans Other Than Pension Plans

(“OPEBs”), and No. 45 (“GASB 45”), Accounting and Financial Reporting by Employers for Post

Employment Benefits Other Than Pensions. GASB 43 was implemented by the City for fiscal year

ending December 31, 2006 and GASB 45 was implemented by the City for fiscal year ending

December 31, 2007.

GASB 45 requires the accounting for the annual cost of OPEB and the related outstanding

liability using an actuarial approach similar to pensions. The City implemented prospectively (zero net

obligation at transition).

Plan Description

The City provides certain postemployment health care benefits to eligible retirees and their

dependents in accordance with provisions established in Chapter 23 of the Omaha Municipal Code. The

plan is a single-employer defined benefit health care plan administered by the City. The plan does not

issue separate financial statements.

Funding Policy

The contribution requirements of plan members and the City are established through labor

negotiations, with the Police Union, the Fire Union, the Omaha City Employees Local No. 251, and other

classified civilian and sworn employees. All agreements are approved and can be amended by the Omaha

City Council. Contributions are made to the plan based on a pay-as-you-go basis and the City self-insures

this benefit. For the year ended December 31, 2012, the City paid $15,642,584 for 916 retirees. Retiree

contribution rates vary from 0% to 10% of an annual estimated premium depending on the bargaining

group date of retirement. Retiree contributions for 2012 were $ 439,174.

Annual OPEB Cost and Net OPEB Obligation

The City’s annual OPEB expense is calculated based on the ARC, an amount actuarially

determined in accordance with the parameters of GASB 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 30 years. The City’s annual

OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation

for 2012 and 2011 are as follows:

Fiscal Year Ended

(December 31) Annual OPEB Cost

% of Annual

OPEB Contribution Net OPEB

2012 $44,454,512 35% $144,918,982

2011 $47,322,593 38% $116,107,053

The following tables show (1) the components of the City’s annual OPEB cost for the year, the

amount actually contributed to the plan, and changes in the City’s net OPEB obligation and (2) the funded

status of the plan:

B-27

(1) Annual required contribution (ARC) $45,752,280

Contributions made (15,642,584)

Increase in OPEB obligation 28,811,928

Net OPEB obligation — beginning of year 116,107,053

Net OPEB obligation — end of year $144,918,981

(2) The funded status of the plan as of January 1, 2012 is as follows:

Actuarial accrued liability (AAL) $449,381,032

Actuarial value of plan assets 0

Unfunded actuarial accrued liability (UAAL) 449,381,032

Funded ratio 0.00%

Covered payroll 164,200,000

UAAL as a percentage of covered payroll 274%

Source: Finance Department, City of Omaha.

Actuarial Methods and Assumptions

Actuarial valuations on an ongoing plan involve estimates of the value-reported amounts and

assumptions about the probability of occurrence of events far into the future. Examples include

assumptions about future employment, mortality and the health care cost trend. Amounts determined

regarding the funded status of the plan and the annual required contributions of the employer are subject

to continual revision as actual results are compared with past expectations and new estimates are

made about the future.

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 benefits provided at the time of each

valuation and the historical pattern of sharing benefit costs between the employer and plan member to that

point. The actuarial methods used include techniques that are designed to reduce the effects of short-term

volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term

perspective of the calculations. In the January 1, 2012 actuarial valuation, the unprojected unit

credit actuarial cost method was used. The actuarial assumptions included a 3% projected

investment rate of return and an annual health care cost trend of 8.10% initially, reduced by decrements

to an ultimate rate of 4.70% after 71 years. Both rates include a 2.50% inflation assumption. The

amortization of the unfunded actuarial accrued liability is calculated assuming 25 annual payments

increasing at 2.75% per year. The amortization method used is the level percentage of projected payroll

method and the amortization period is closed 30-year period beginning in 2007.

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APPENDIX B—CITY OF OMAHA FINANCIAL INFORMATION

PART TWO

Comprehensive Annual Financial Report

(December 31, 2012)

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CITY OF OMAHA, NEBRASKA

COMPREHENSIVE ANNUALFINANCIAL REPORT

FOR

FISCAL YEAR ENDED

•

MAYOR JEAN STOTHERT

DECEMBER 31, 2012

Office of the Mayor— 1819 Farnam Street, Suite 300

Omaha, Nebraska 68183-0300(402) 444-5000

*eo FAX: (402) 444-6059

City of Omaha

Jean Stothert, Mayor

Dear Omaha Citizens and Public Officials:

I am pleased to submit the City of Omaha’s Comprehensive Annuai Financial Report forthe fiscal year that ended December 31, 2012.

A public report from governmental entities of their financial transactions and fundbalances represents the work of those entrusted with public funds on behalf of theirfellow citizens. In Omaha, the work of thousands of dedicated public employees towardtheir department and our community goals are reflected in the pages that follow.Complete and accurate disclosure and explanations of public expenses not only satisf’governmental accounting standards; they provide the transparency citizens expect anddeserve.

Our finance professionals take great pride in their work in developing this report. Iwould like to thank them for their efforts and for working every day to enhance the fiscalstability of our great City.

Sincerely,

Jean StothertMayorCity of Omaha

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CITY OF OMAHA, NEBRASKA

Comprehensive Annual Financial Report

December 31, 2012

Mayor

Jean Stothert

City Council

Pete Festersen District #1

Ben Gray District #2

Chris Jerram District #3

Garrv Gernandt District #4

Rich Pahls District #5

Franklin Thompson District #6

Aimee Melton District #7

City Officials

Buster Brown City Clerk

Allen Herink Acting Finance Director

Michael McDonnell Fire Chief

Steve Kerrigan Acting Human Resources Director

Steve Kerrigan Acting Human Rights and Relation Director

Paul Kratz City Attorney

Gary Wasdin Library Director

Brook Bench Acting Parks, Recreation & Public Property Director

James Thele Acting Planning Director

Todd Schmaderer Police Chief

Robert Stubbe Public Works Director

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CITY OF OMAHA, NEBRASKA

Table of Contents

Page(s)

Introductory Section

Organizational Chart 1Letter of Transmittal 2 — 5Certificate of Achievement for Excellence in Financial Reporting 6

Financial Section

Independent Auditors’ Report 7 _9Management’s Discussion and Analysis (Unaudited) 10—22

Basic Financial Statements:Governmentwide Financial Statements:

Statement of Net Position 23Statement of Activities 24

Fund Financial Statements:Governmental Funds:

Balance Sheet 25Statement of Revenues, Expenditures, and Changes in Fund Balances 26Reconciliation of the Change in Fund Balances of Governmental Funds to the

Statement of Activities 27

Proprietary Funds:Statement of Net Position 28Statement of Revenues, Expenses, and Changes in Fund Net Position 29Statement of Cash Flows 30

Fiduciary Funds:Statement of Fiduciary Net Position 31Statement of Changes in Fiduciary Net Position 32

Discretely Presented Component Units:Combining Statement of Net Position 33Combining Statement of Activities 34

Notes to Basic Financial Statements 35 — 89

Required Supplementary Information (Unaudited):Budgetary Comparison Schedule — General Fund 90Notes to Budgetary Comparison Schedule — General Fund 91 —92Schedules of Funding Progress and Employer Contributions 93 — 94

CITY OF OMAHA, NEBRASKA

Table of Contents

Page(s)

Supplemental Information:

Combining Balance Sheet — Nonmajor Governmental Funds 95Combining Statement of Revenues, Expenditures, and Changes in Fund Balances — Nonmajor

Governmental Funds 96Nonmajor Governmental Funds — Special Revenue Funds:

Combining Balance Sheet — Nonmajor Special Revenue Funds 100— 103Combining Statement of Revenues, Expenditures, and Changes in Fund Balances —

Nonmajor Special Revenue Funds 104— 107Budgetary Comparison Schedule — Judgment Fund (unaudited) 108Budgetary Comparison Schedule — Library Fine and Fees Fund (Unaudited) 109Budgetary Comparison Schedule — Douglas County Library Supplement Fund (Unaudited) 110Budgetary Comparison Schedule — Keno/Lottery Proceeds Fund (Unaudited) 111Budgetary Comparison Schedule — SID Administrative Fees Revenue Fund (Unaudited) 112Budgetary Comparison Schedule — Storm Water Fee Revenue Fund (Unaudited) 113Budgetary Comparison Schedule — City Street Maintenance Fund (Unaudited) 114Budgetary Comparison Schedule — Street and Highway Allocation Fund (Unaudited) 115Budgetary Comparison Schedule — Interceptor Sewer Construction Fund (Unaudited) 116Budgetary Comparison Schedule — Community Park Development Fund (Unaudited) 117Budgetary Comparison Schedule — State Turn Back Revenue Fund (Unaudited) 118Budgetary Comparison Schedule — Keno/Lottery Reserve Fund (Unaudited) 119Budgetary Comparison Schedule — Greater Omaha Convention and Visitors

Bureau Fund (Unaudited) 120Budgetary Comparison Schedule — Household Chemical Disposal Fund (Unaudited) 121

Nonmajor Governmental Funds — Debt Service Funds:Balance Sheet — Nonmajor Debt Service Fund 123Statement of Revenues, Expenditures, and Changes in Fund Balances — Nonmajor Debt

Service Fund 124Budgetary Comparison Schedule — Debt Service Fund (Unaudited) 125Budgetary Comparison Schedule — Riverfront Redevelopment Special Tax Fund (Unaudited) 126

Nonmajor Governmental Funds — Capital Project Funds:Combining Balance Sheet — Nonmajor Capital Project Funds 130 — 132Combining Statement of Revenues, Expenditures, and Changes in Fund Balances —

Nonmajor Capital Project Funds 133 — 135Budgetary Comparison Schedule — Advanced Acquisition Fund (Unaudited) 136Budgetary Comparison Schedule —2010 Environmental Bond Fund (Unaudited) 137Budgetary Comparison Schedule —2006 Transportation Bond Fund (Unaudited) 138Budgetary Comparison Schedule —2010 Transportation Bond Fund (Unaudited) 139Budgetary Comparison Schedule —2006 Public Facilities Bond Fund (Unaudited) 140Budgetary Comparison Schedule —2010 Public Facilities Bond Fund (Unaudited) 141Budgetary Comparison Schedule — 2006 Public Safety Bond Fund (Unaudited) 142

CITY OF OMAHA, NEBRASKA

Table of Contents

Page(s)

Budgetary Comparison Schedule —2010 Public Safety Bond Fund (Unaudited) 143Budgetary Comparison Schedule — 2006 Parks and Recreation Bond Fund (Unaudited) 144Budgetary Comparison Schedule —2010 Parks and Recreation Bond Fund (Unaudited) 145Budgetary Comparison Schedule — Downtown Stadium and Companion

Projects Fund (Unaudited) 146Budgetary Comparison Schedule — Pedestrian Trail Bridge-Joint Use (Unaudited) 147Budgetary Comparison Schedule — Special Assessment Funds (Unaudited) 148

Nonmajor Govemmental Funds — Permanent Funds:Combining Balance Sheet — Nonmajor Permanent Funds 150Combining Statement of Revenues, Expenditures, and Changes in Fund Balances—

Nonmajor Permanent Funds 151Budgetary Comparison Schedule — Western Heritage Permanent Fund (Unaudited) 152

Nonmajor Enterprise Funds:Combining Statement of Net Position — Nonmajor Enterprise Funds 154Combining Statement of Revenues, Expenses, and Changes in Net Position — Nonmajor

Enterprise Funds 155Combining Statement of Cash Flows — Nonmajor Enterprise Funds 156

Pension Trust Funds:Combining Statement of Fiduciary Net Position — Pension Trust Funds 158Combining Statement of Changes in Fiduciary Net Position — Pension Trust Funds 159

Agency Funds:Combining Statement of Fiduciary Assets and Liabilities — Agency Funds 162 — 164Combining Statement of Changes in Assets and Liabilities — Agency Funds 165 — 167

Statistical Section (Unaudited)

Net Position by Component 169Changes in Net Position 170 — 171Fund Balances of Govemmental Funds 172Changes in Fund Balances of Governmental Funds 173Tax Revenues by Source 174Assessed Value and Estimated Actual Value of Taxable Property 175Direct and Overlapping Govemments 176Principal Property Taxpayers 177Property Tax Levies and Collections 178Total City Taxable Sales 179Direct and Overlapping Governments 180Ratios of Outstanding Debt by Type 181Ratios of General Obligation Debt Outstanding 182Direct and Overlapping Governmental Activities Debt 183

CITY OF OMAHA, NEBRASKA

Table of Contents

Page(s)

Legal Debt Margin Information 184Pledged Revenue Coverage 185 — 186Demographic and Economic Statistics 187Principal Employers 188Full-Time Equivalent City Government Employees by FunctionlProgram 189Operating Indicators by Function/Program 190Capital Asset Statistics by FunctionlProgram 191

INTRODUCTORY SECTION

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Finance Department

Omaha/Douglas Civic Center1819 Farnam Street, Suite 1004Omaha Nebraska 68 183-1004

(402) 444-5416Telefax (402) 546-1150

Allen R. Herink

City of Omaha Acting Director

Jean Stothert, Mayor Comptroller

July 31, 2013

To the Honorable Mayor, Members of the City Council,and Citizens of the City of Omaha:

State law requires that all general-purpose local govemments publish within six months of the close ofeach fiscal year a complete set of financial statements presented in conformity with generally acceptedaccounting principles (GAAP) and audited in accordance with generally accepted auditing standards by afirm of licensed certified public accountants. Pursuant to that requirement, we hereby issue thecomprehensive annual financial report of the City of Omaha (the City) for the fiscal year endedDecember 31, 2012.

This report consists of management’s representations conceming the finances of the City of Omaha.Consequently, management assumes full responsibility for the completeness and reliability of all of theinformation presented in this report. To provide a reasonable basis for making these representations,management of the City of Omaha has established a comprehensive internal control framework that isdesigned both to protect the government’s assets from loss, theft, or misuse and to compile sufficientreliable information for the preparation of the City of Omaha’s financial statements in conformity withGAAP. Because the cost of internal controls should not outweigh their benefits, the City of Omaha’scomprehensive framework of internal controls has been designed to provide reasonable rather than absoluteassurance that the financial statements will be free from material misstatement. As management, we assertthat, to the best of our knowledge and belief this financial report is complete and reliable in all materialrespects.

The City of Omaha’s financial statements have been audited by KPMG LLP, a firm of licensed andcertified public accountants. The goal of the independent audit was to provide reasonable assurance that thefinancial statements of the City of Omaha for the fiscal year ended December 31, 2012, are free of materialmisstatement. The independent audit involved examining, on a test basis, evidence supporting the amountsand disclosures in the financial statements; assessing the accounting principles used and significantestimates made by management; and evaluating the overall financial statement presentation. Theindependent auditor concluded, based upon the audit, that there was a reasonable basis for renderingunqualified opinions that the City of Omaha’s financial statements for the fiscal year ended December 31,2012, are fairly presented in conformity with GAAP. The independent auditor’s report is presented as thefirst component of the financial section of this report.

The independent audit of the financial statements of the City of Omaha was part of a broader, federallymandated “Single Audit” designed to meet the special needs of federal grantor agencies. The standardsgoverning Single Audit engagements require the independent auditor to report not only on the fairpresentation of the financial statements, but also on the audited government’s internal controls andcompliance with legal requirements, with special emphasis on internal controls and legal requirements

The Honorable Mayor, Members of the City Council,and Citizens of the City of Omaha

July 31, 2013

involving the administration of federal awards. These reports are available in the City of Omaha’sseparately issued Single Audit Report.

GAAP requires that management provide a narrative introduction, overview, and analysis to accompanythe basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This letterof transmittal is designed to complement MD&A and should be read in conjunction with it. The City ofOmaha’s MD&A can be found immediately following the report of the independent auditors.

Profile of the Government

The City of Omaha, incorporated in 1857, is located in the eastern part of the state of Nebraska, and is the42nd largest city in the nation. The City of Omaha currently occupies a land area of 127 square miles andserves a population of 419,041. The City of Omaha has seen steady upward growth over the past fivedecades and growth of 4.9% between 2000 and 2010. The City of Omaha is empowered to levy a propertytax on both real and personal properties located within its boundaries. It also is empowered by state statuteto extend its corporate limits by annexation, which occurs periodically when deemed appropriate by thegoverning council.

The City of Omaha is operated under the Mayor-Council form of government. The Mayor andseven-member City Council are both elected to four-year terms. The executive and administrative powersof the City of Omaha are vested in the Mayor, who is popularly elected on a non-partisan basis.Agreements with Douglas County provide for the sharing of library, information technology, parks,purchasing, printing, mail, and 911 services between city and county residents.

The City of Omaha provides a full range of services, including police and fire protection, the constructionand maintenance of highways, streets, and other infrastructure, recreational activities and cultural events.The City of Omaha is financially accountable for the Metropolitan Entertainment and ConventionAuthority (MECA) and Heartland Workforce Solutions, Inc. (HWS). MECA is a separate nonprofitcorporation that is responsible for the operation of the Omaha Convention Center/Arena, the CivicAuditorium, and TD Ameritrade Stadium. HWS is a separate 501(c)(3) nonprofit organization thatadministers the Workforce Investment Act activities for adults, youth, and dislocated workers in Douglas,Sarpy and Washington Counties in Nebraska. Additional information regarding both MECA and HWS canbe found in Note 1 (a) in the notes to basic financial statements.

The annual budget serves as the foundation for the City of Omaha’s financial planning and control. Allagencies of the City of Omaha are required to submit requests for appropriation to the Finance Directorduring April of each year. The Finance Director uses these requests as the starting point for developing aproposed budget. The Finance Director then provides the Mayor with a proposed budget. The Mayorreviews all estimates, expenditures, and capital improvements, and makes revisions where necessary. Notlater than 30 days before the tax levy certification date, the Mayor then submits the proposed budget to theCity Council for consideration, at which time the budget becomes a public record and open to inspection.The City Council is required to hold public hearings on the proposed budget and to adopt a final budget nolater than the day prior to the tax levy certification date. The appropriated budget is prepared by fund anddepartment (e.g., police). The Mayor may at any time transfer an unencumbered appropriation balance orportion thereof between appropriations of the same division. Transfers of appropriations between divisionswithin the same department, however, require the special approval of the City Council. Budget-to-actualcomparisons are provided in this report for each individual governmental fund for which an appropriated

The Honorable Mayor, Members of the City Council,and Citizens of the City of Omaha

July 31, 2013

annual budget has been adopted. For the general fund, this comparison is presented on page 90 as part ofthe required supplemental information. For governmental funds, other than the general fund, withappropriated annual budgets, this comparison is presented in the governmental fund subsection of thisreport. which starts on page 95. Also included in the governmental fund subsection are project-lengthbudget-to-actual comparisons for each governmental fund for which a project-length budget has beenadopted (e.g., the CDBG revitalization project special revenue fund and the capital projects funds).

Factors Affecting Financial Condition

The information presented in the financial statements is perhaps best understood when it is consideredfrom the broader perspective of the specific environment within which the City of Omaha operates.

Local Economy. The City of Omaha currently enjoys a favorable economic environment and localindicators point to continued stability. Unemployment in the City of Omaha in 2012 was 4.3%, well belowthe national average. The City of Omaha has a high concentration of its employment in trade,transportation and utilities, professional and business services, education, and healthcare services. The Cityhas a relatively small amount of total employment in manufacturing and government. Over the past decade,Omaha has experienced solid growth, despite two recessions at the national level. The City is the corporateheadquarters for such Fortune 500 companies as: Berkshire Hathaway, Union Pacific, ConAgra Foods,Peter Kiewit, and Mutual of Omaha.

The Greater Omaha Metropolitan Statistical Area (MSA) (which includes the eight-county region ofDouglas, Sarpy, Cass, Saunders and Washington counties in Nebraska and Harrison, Mills andPottawattamie counties in Iowa) has a population of approximately 888,959. The MSA grew by 14.9percent between 2000 and 2011 and is projected to grow another 7.3 percent by 2016. The government’scentral business district is expected to maintain its current occupancy rate with a variety of stores, specialtyshops, commercial businesses, and a rising number of residential living spaces.

Long-Term Financial Planning. The City has a steady capital improvement plan that provides forreinvesting in City streets, public facilities, public safety, libraries, parks, and infrastructure over the nextfive years.

Combined Sewer Overflow (CSO)

Like many communities across the nation, the City of Omaha is addressing its CSO problem byimplementing a CSO Long Term Control Plan. Combined sewer overflow occurs when untreatedwastewater and storm water commingle in a single pipe and spill into Omaha’s rivers and creeks. The totalcost of the program, which the City anticipates will extend over approximately 15 years, is estimated at$1.66 billion in 2009 dollars. Annual borrowing needs for the foreseeable future will be in the range of $75million to $150 million. The City has increased and is increasing its rates and charges for the system on anannual basis for each of the fiscal years 2011 through 2018, primarily for the purpose of paying for the costof the program.

Awards and Acknowledgements

The Government Finance Officers Association of the United States and Canada (GFOA) awarded aCertificate of Achievement for Excellence in Financial Reporting to the City of Omaha for itscomprehensive annual financial report for the fiscal year ended December 31, 2011. In order to be awardeda Certificate of Achievement, a government must publish an easily readable and efficiently organized

The Honorable Mayor, Members of the City Council,and Citizens of the City of Omaha

July 31, 2013

comprehensive annual financial report. This report must satisfy both generally accepted accountingprinciples and applicable legal requirements.

A certificate of Achievement is valid for a period of only one year. We believe that our currentcomprehensive annual financial report continues to meet the Certificate of Achievement Program’srequirements, and we are submitting it to the GFOA to determine its eligibility for another certificate.

In addition, the City also received the GFOA’s Distinguished Budget Presentation Award for its annualbudget document dated December 31, 2011. In order to qualify for the Distinguished Budget PresentationAward, the government’s budget document must be judged as proficient in several categories, including asa policy document, a financial plan, an operations guide, and a communications device.

The preparation of this request would not have been possible without the efficient and dedicated services ofthe entire staff of the Finance and Administration Department. We would like to express our appreciationto all members of the department who assisted and contributed to the preparation of this report. Credit alsomust be given to the Mayor and the City Council for their unfailing support for maintaining the higheststandards of professionalism in the management of the City of Omaha’s finances.

Respectfully submitted,

Allen R. HerinkActing Finance Director

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FINANCIAL SECTION

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KPMG LLPSuite 1501222 South 15th StreetOmaha, NE 68102-1610

Suite 1600233 South 13th StreetLincoln, NE 68508-2041

Independent Auditors’ Report

The Honorable Mayor and Membersof the City Council

City of Omaha, Nebraska:

Report on the Financial Statements

We have audited the accompanying financial statements of the governmental activities, the business-typeactivities, the aggregate discretely presented component units, each major fund, and the aggregateremaining fund information of the City of Omaha, Nebraska (the City), as of and for the year endedDecember 31, 2012, and the related notes to the financial statements, which collectively comprise theCity’s basic financial statements as listed in the table of contents.

Management’s Responsibilityfor the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements inaccordance with U.S. generally accepted accounting principles; this includes the design, implementation,and maintenance of internal control relevant to the preparation and fair presentation of financial statementsthat are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express opinions on these financial statements based on our audit. We did not auditthe financial statements of Metropolitan Entertainment and Convention Authority (MECA) and HeartlandWorkforce Solutions, which statements are included as discretely presented component units and represent100% of the discretely presented component units as of and for the year ended December 31, 2012. Thosestatements were audited by other auditors, whose reports have been fumished to us, and our opinion,insofar as it relates to the amounts included for MECA and Heartland Workforce Solutions, is based solelyon the reports of the other auditors. We conducted our audit in accordance with auditing standardsgenerally accepted in the United States of America and the standards applicable to financial auditscontained 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 whetherthe basic financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in thefinancial statements. The procedures selected depend on the auditors’ judgment, including the assessmentof the risks of material misstatement of the financial statements, whether due to fraud or error. In makingthose risk assessments, the auditors consider internal control relevant to the entity’s preparation and fairpresentation of the financial statements in order to design audit procedures that are appropriate in thecircumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internalcontrol. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of significant accounting estimates made by management,as well as evaluating the overall presentation of the financial statements.

KPMG LLP is a Delaware limited liability partnership,the U.S. member firm of KPMG letereahonal Cooperative(KPMG leternatioeal”), a Swiss entity.

W4

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for ouraudit opinions.

Opinions

In our opinion, based on our audit and the report of the other auditors, the financial statements referred toabove present fairly, in all material respects, the respective financial position of the governmentalactivities, the business-type activities, the aggregate discretely presented component units, each majorfund, and the aggregate remaining fund information of the City of Omaha, Nebraska, as of December 31,2012, and the respective changes in its financial position and, where applicable, cash flows thereof for theyear then ended in accordance with U.S. generally accepted accounting principles.

Other Matters

Required Supplementary Information

U.S. generally accepted accounting principles require that the management’s discussion and analysis onpages 10 to 22, the budgetary comparison schedule — general fund on page 90, the notes to budgetarycomparison schedule — general fund on pages 91 to 92, and schedules of funding progress and employercontributions on pages 93 to 94, be presented to supplement the basic financial statements. Suchinformation, although not a part of the basic financial statements, is required by the GovernmentalAccounting Standards Board who considers it to be an essential part of financial reporting for placing thebasic financial statements in an appropriate operational, economic, or historical context. We have appliedcertain limited procedures to the required supplementary information in accordance with auditing standardsgenerally accepted in the United States of America, which consisted of inquiries of management about themethods of preparing the information and comparing the information for consistency with management’sresponses to our inquiries, the basic financial statements, and other knowledge we obtained during ouraudit of the basic financial statements. We do not express an opinion or provide any assurance on theinformation because the limited procedures do not provide us with sufficient evidence to express anopinion or provide any assurance.

Supplementary and Other Injörmation

Our audit was conducted for the purpose of forming opinions on the financial statements that collectivelycomprise the City’s basic financial statements. The combining and individual nonmajor fund financialstatements and budgetary comparison schedules, and the introductory and statistical sections, are presentedfor purposes of additional analysis and are not a required part of the basic financial statements.

The combining and individual nonmajor fund financial statements are the responsibility of managementand were derived from and relate directly to the underlying accounting and other records used to preparethe basic financial statements. Such information has been subjected to the auditing procedures applied inthe audit of the basic financial statements and certain additional procedures, including comparing andreconciling such information directly to the underlying accounting and other records used to prepare thebasic financial statements or to the basic financial statements themselves, and other additional proceduresin accordance with auditing standards generally accepted in the United States of America. In our opinion,the combining and individual nonmajor fund financial statements are fairly stated in all material respects inrelation to the basic financial statements as a whole.

The introductory section and statistical section and budgetary comparison schedules have not beensubjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly,we do not express an opinion or provide any assurance on them.

8

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Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated July 31, 2013 onour consideration of the City’s internal control over financial reporting and on our tests of its compliancewith certain provisions of laws, regulations, contracts, and grant agreements and other matters. Thepurpose of that report is to describe the scope of our testing of internal control over financial reporting andcompliance and the results of that testing, and not to provide an opinion on internal control over financialreporting or on compliance. That report is an integral part of an audit performed in accordance withGovernment Auditing Standards in considering the City’s internal control over financial reporting andcompliance.

LCP

Omaha, NebraskaJuly 31, 2013

9

CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 3 1, 2012

(Unaudited)

The discussion and analysis of the City of Omaha’s (the City) financial performance provides an overall reviewof the City’s financial activities for the fiscal year ended December 31, 2012. The intent of this discussion andanalysis is to look at the City’s financial performance as a whole. Readers should also review the basic financialstatements to enhance their understanding of the City’s financial performance.

Financial Highlights for Fiscal Year 2012

o The assets of the City, on a governmentwide basis excluding component units, exceeded its liabilities at theclose of fiscal year 2012 by $447.3 million (net position). Of this amount, $110.1 million is an unrestricteddeficit, while $496.6 million is the City’s net investment in capital assets, and $60.8 million is restrictedfor specific purposes.

o The City’s total net position decreased by $23.9 million from the prior year. Of this amount, $32.5 millionwas a decrease in governmental activities and $8.6 million was an increase in business-type activities. Thedecrease in net position related to governmental activities is primarily attributable to current year increasesfor net pension obligations by $27.7 million and postretirement benefits obligations by $27.6 million. Theincrease in business-type activities is primarily attributable to an increase in the Sewer Revenue Fund of$13.5 million. This increase was offset by a decrease in net position of the Convention Center Hotel Fundin the amount of $5.5 million.

• As of December 31, 2012, the City’s governmental funds reported combined ending fund balances of$115.6 million, an increase of $52.4 million in comparison with the prior year. This increase is largely dueto the receipt of $21 million from 2011 flood insurance proceeds; pledged Stadium receipts of $7.0million; City Capital Improvement bonds, $5.4 million; Parks and Recreation bonds, $4.6 million; andincreased Street & Highway revenues of $3.2 million. Of the combined governmental funds ending fundbalances, approximately 48.7%, or $56.2 million, is available for spending at the City’s discretion(unassigned and assigned fund balance).

• The general fund, on a current fiscal resources basis, reported a surplus of revenues over expenditures,lapsed encumbrances, and transfers of $9.4 million. Revenues were above budget in the amount of $5.1million and expenditures under budget, lapsed encumbrances and year-end transfers in the amount of $4.3million account for a 2012 year-end carryover reserve of $9.4 million.

• At the end of the current fiscal year, the unassigned/assigned fund balance for the general fund was$44.8 million, or 14.6% of general fund expenditures.

o As of December 31, 2012, the City’s general obligation bond rating from Standard & Poor’s was AAA andMoody’s Investor Service rated the City’s bonds Aal.

Overview of the Financial Statements

This discussion and analysis is intended to serve as an introduction to the City’s basic financial statements. TheCity’s basic financial statements comprise three components: (1) govemmentwide financial statements, (2) fundfinancial statements, and (3) notes to the financial statements. This report also contains other supplementaryinformation in addition to the basic financial statements themselves.

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CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

The basic financial statements include two kinds of statements that present different views of the City:

• The first two statements are govemmentwide statements that provide both long-tenn and short-terminformation about the City’s overall financial status.

The remaining statements are fund financial statements that focus on individual parts of the City’sgovernment, reporting the City’s operations in more detail than the governmentwide statements.

— Governmental fund statements tell how general government services such as public safety werefinanced in the short term, as well as what amounts remain for future spending.

— Proprietary fund statements offer short-term and long-term financial information about the activitiesthe government operates similar to a business, such as the City’s sewage treatment plants orConvention Center Hotel.

— Fiduciary fund statements provide information about financial relationships in which the City actssolely as a trustee or agent for the benefit of others, to whom the pertaining resources belong, forexample, parking fine receipts which are remitted to the school district.

The financial statements also include notes that explain some of the information in the financial statements andprovide more detailed data. The statements are followed by a section of required supplementary information thatfurther explains and supports the information in the financial statements.

Government-wide Financial Statements

The govemmentwide financial statements are designed to provide readers with a broad overview of the City’sfinances, using accounting methods similar to those used by private sector companies. The statement of netposition and the statement of activities, which are the governmentwide statements, include the City’s assets andliabilities using the accrual basis of accounting, which is similar to the accounting used by most private sectorcompanies. All changes in net position are reported as soon as the underlying event giving rise to the changeoccurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statementfor some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned butunused vacation leave).

These two governrnentwide statements report the City’s net position and how it has changed. Net position — thedifference between the City’s assets and liabilities — is one way of measuring the City’s financial health orfinancial position. Over time, increases or decreases in the City’s net position is an indicator of whether itsfinancial health is improving or deteriorating. Other nonfinancial factors, such as changes in the City’s propertytax base and the condition of the City’s roads and other infrastructure, may need to be considered to assess theoverall health of the City.

In the statement of net position and the statement of activities, the City is divided into three categories:

Governmental Activities — Most of the City’s basic services are included here, such as the police, fire, publicworks, parks and recreation, and general administration departments. Taxes and intergovernmental revenuesprincipally support these functions.

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CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

Business-Type Activities — The City charges fees to customers in order to cover the costs of certain services itprovides. The City’s sewer system, air quality control enforcement, compost operation, marinas, golf courses,tennis operation, parking facilities, printing services, river plaza facility, citywide sports, and hotel are includedhere.

Component Units — The City includes two separate legal entities in its report, the Metropolitan Entertainmentand Convention Authority (MECA), and Heartland Workforce Solutions Inc. Although legally separate, these“component units” are important because the City is financially accountable for them and the City provides debtservice funding for the arena and convention center (see note 1).

The governmentwide financial statements can be found on pages 23 and 24 of this report.

Fund Financial Statements

The fund financial statements provide more detailed information about the City’s most significant funds — not theCity as a whole. Funds are accounting mechanisms that the City uses to keep track of specific sources of fundingand spending for particular purposes. The City Charter, state law, and bond covenants require certain funds. TheCity Council or Administration establishes other funds to control and manage money for particular purposes or toshow that the City is properly using certain taxes and grants.

The City has three kinds of funds:

Governmental Funds — Most of the City’s basic services are included in governmental funds, which focus on(1) the flow in and out of cash and other financial assets that can readily be converted to cash and (2) thebalances remaining at year-end that are available for spending. These funds are reported using the modifiedaccrual accounting basis and a current financial resources measurement focus. Consequently, the governmentalfund statements provide a detailed short-term view that helps the reader determine whether there are more orfewer financial resources that can be spent in the near future to finance the City’s programs. The relationshipbetween governmental activities (reported in the statement of net position and the statement of activities) andgovernmental funds is described in a reconciliation that follows the governmental fund financial statements.

The City maintains 93 governmental funds. Information is presented separately in the governmental fund balancesheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for thegeneral fund and debt service fund, which are considered to be major funds. Data from the other governmentalfunds are combined into a single, aggregated presentation.

The City adopts an annual budget for the general fund, as required by the City Charter. A budgetary comparisonstatement is presented for the general fund using the City’s budgetary basis of accounting. This statement reflectsthe following: (a) the original budget, (b) the final budget as amended, (c) actual results, and (d) the variancebetween the final budget and actual results. Because the budgetary basis of accounting differs from the modifiedaccrual basis used in the funds statements, a reconciliation is provided at the end of the statement.

The governmental fund financial statements can be found on pages 25 through 27 of this report.

Proprietary Funds — Services for which the City charges customers a fee are generally reported in proprietaryfunds. Proprietary funds, like the governmentwide statements, provide both short- and long-term financial

12 (Continued)

CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

information. The City maintains 15 enterprise funds, which are a type of proprietary fund. Enterprise funds areused to report the same functions presented as business-type activities in the governmentwide financialstatements. The City uses enterprise funds to account for its sewer system, air quality control enforcement,compost operation, marina dredge operations, golf course operations, tennis operation, river plaza facility,parking facilities, printing services, citywide sports, and hotel.

The proprietary fund financial statements can be found on pages 28 through 30 of this report.

Fiduciary Funds — The City is the trustee, or fiduciary, for certain donated funds. The City maintains 24fiduciary funds. It is also responsible for other assets that, because of a trust arrangement, can be used only forthe trust beneficiaries. The City is responsible for ensuring that the assets reported in these funds are used fortheir intended purpose. These activities are reported in a separate statement of fiduciary net position. The Cityexcludes this activity from its govemmentwide financial statements because the City cannot use these assets tofinance its operations. The accounting used for fiduciary funds is much like that used for proprietary funds.

The fiduciary fund financial statements can be found on pages 31 and 32 of this report.

Notes to the Basic Financial Statements

The notes provide additional information that is essential to a full understanding of the data provided in thegovemmentwide and fund financial statements. The notes to the basic financial statements can be found on pages35 through 89 of this report.

Other Information

In addition to the basic financial statements and accompanying notes, this report also presents certain requiredsupplementary information concerning the City’s 2012 budget information and the City’s progress in funding itsobligation in both pension and other postemployment benefits. Required supplementary information can be foundon pages 90 through 94 of this report.

City Governmentwide Financial Analysis

As noted earlier, net position (assets over liabilities) may serve over time as a useful indicator of a government’sfinancial position. In the case of the City, assets exceeded liabilities by $447.3 million at the close of fiscal year2012. The City’s net investment in capital assets reflects its investment in capital assets (e.g., land, building,equipment, and infrastructure), less accumulated depreciation, and less any related outstanding debt used toacquire those assets. The City uses these assets to provide services to its citizens, and consequently, these assetsare not available for future spending. The resources needed to repay the debt related to these capital assets mustbe provided from other sources.

13 (Continued)

CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

The following table reflects the condensed summary of net position (in millions):

CITY OF OMAHA

Summary of Net Position

Governmental Business-type Total primaryactivities activities government

2012 2011 2012 2011 2012 2011

Current and other assets $ 339 308 190 138 529 446Capital assets 1,104 1,104 662 595 1,766 1,699

Total assets $ 1,443 1,412 852 733 2,295 2,145

Current and other liabilities $ 128 53 42 15 170 68Long-term liabilities 1,147 1,159 531 447 1,678 1,606

Total liabilities 1,275 1,212 573 462 1,848 1,674

Net position:Net Investment in capital

assets 360 352 137 166 497 518Restricted position 17 7 43 40 60 47Unrestricted position (deficit) (209) (159) 99 65 (110) (94)

Total net position 168 200 279 271 447 471

Total liabilities andnet position $ 1,443 1,412 852 733 2,295 2,145

Governmental Activities

Net position of the City’s governmental activities decreased $32.6 million (16.3%) to $167.6 million. However, asignificant portion of that net position is either restricted as to the purpose it can be used for or the City’s netinvestment in capital assets (building, roads, bridges, etc.). Consequently, unrestricted net position showed a$209 million deficit at the end of this year. This deficit does not mean that the City does not have the resourcesavailable to pay its current liabilities. Rather, it is the result of having long-term commitments that are greaterthan current available resources. Specifically, the City did not included in past annual budgets the full amountsneeded to finance future liabilities arising from worker’s compensation and healthcare claims ($38.7 million),Civilian employees, Policemen’s and Firemen’s net pension obligation ($201.7 million) and postemploymentbenefits ($137.2 million). The City will include these amounts in future years’ budgets as they become due.

Business-Type Activities

The net position of the City’s business-type activities increased approximately $8.7 million to $279.7 million.The City generally can only use this net position to finance the continuing operation of its enterprise operations.A key element of this increase is the $13.5 million increase in net position incurred by the Sewer Fund.

14 (Continued)

CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

The following table shows the revenue and expense of the governmental and business-type activities:

City of Omaha’s Change in Net Position(In millions)

Governmental Business-type Total primaryactivities activities government

2012 2011 2012 2011 2012 2011Revenues:

Program revenues:Charges for services $ 84.2 78.3 94.8 77.0 179.0 155.3Operating grants and

contributions 70.6 81.3 0.9 0.7 71.5 82.0Capital grants and

contributions 2.1 2.0 1.3 3.4 2.0General revenues:

Sales and use tax 128.4 126.6 128.4 126.6Propertytax 141.8 139.6 141.8 139.6Othertaxes 75.7 74.1 75.7 74.1Unrestricted investment

earnings 2.4 2.0 0.4 0.6 2.8 2.6

Total revenues 505.2 503.9 97.4 78.3 602.6 582.2

Expen ses:General government 108.8 102.7 — — 108.8 102.7Public safety 221.1 216.0 — — 221.1 216.0Transportation services 63.8 61.4 — — 63.8 61.4Other public services 30.0 34.2 — — 30.0 34.2Community development 27.3 31.6 — — 27.3 31.6Culture and parks 49.5 60.7 — — 49.5 60.7Interest on long-term debt 34.0 35.2 — — 34.0 35.2Convention Center Hotel — — 16.8 10.1 16.8 10.1Sewage treatment — 62.0 56.7 62.0 56.7Other — — 13.2 13.5 13.2 13.5

Total expenses 534.5 541.8 92.0 80.3 626.5 622.1

Increase (decrease) innet positionbefore transfers (29.3) (37.9) 5.4 (2.0) (23.9) (39.9)

Transfers (3.2) (8.3) 3.2 8.3

Increase (decrease) inin net position (32.5) (46.2) 8.6 6.3 (23.9) (39.9)

Net position at beginning ofyear 200.1 246.3 271.1 264.8 471.2 511.1

Net position at end ofyear $ 167.6 200.1 279.7 271.1 447.3 471.2

15 (Continued)

CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

Governmental Activities

The City’s total revenues from governmental activities were $505.2 million for the fiscal year endedDecember 31, 2012. The largest source of revenue ($141.8 million in 2012) for the City is property tax. Propertytax increased $2.2 million (1.6 %) during 2012. The city property tax rate is 49.922 cents per $100 of assessedvalue. Property tax valuations for 2012 increased by 1.57% when compared with 2011 valuations.

The City’s expenses for governmental activities cover a wide range of services, with 41.4%, or $221.1 million,for fiscal year 2012 related to public safety and 11.9%, or $63.8 million, for fiscal year 2012 for transportationservices. Overall, the expenses for governmental activities decreased by 1.4% or $7.3 million in 2012. This canlargely be attributed to an $11.2 million decrease in expenditures for culture and parks.

Business-Type Activities

The net position of the City’s business-type activities increased by $8.7 million. The change of net position bythe major enterprise funds and the other nonmajor enterprise funds is presented as follows:

Fund Amount(In millions)

Convention Center Hotel $ (5.5)Parking facilities 0.5Sewer revenue 13.5Other nonmajor enterprise funds 0.2

The Convention Center Hotel Fund began operations in April 2004. The City believes that future operations ofthe Hotel will eliminate this deficit. Annual appropriations from the City will subsidize any debt service shortfall.In October 2011, construction was completed on a 150-room expansion project bringing the hotel’s totalinventory to 600 guestrooms. The expansion project also included an additional ballroom.

The Parking Facilities Fund was established as a tool to manage the City’s eight parking structures and varioussurface lots throughout the City. Lease purchase debt has been issued to finance the construction of the parkingstructures. All operating activities of the Parking Facility Fund have been consolidated within Public Works.The completion of a comprehensive parking-fee study may lead to changes in rates based upon location andhours of enforcement.

In May 2009, the City Council enacted an ordinance increasing sewer use fees by twenty to thirty percentannually beginning in 2012 through 2014. The action provides funding for the sewer system’s capitalimprovements.

The City’s enterprise operations are reviewed on an ongoing basis. Revenues and expenses are adjusted asnecessary to maintain an adequate amount of working capital. Annual appropriations may also be used tosubsidize these funds. The City has decided to account for these activities by the use of enterprise accounting tobetter identify the cost of the services and for better management control.

16 (Continued)

CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

Financial Analysis of the Government’s Funds

As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legalrequirements.

Governmental Funds

The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, andbalances of spendable resources. Such information is useful in assessing the City’s financing requirements. Inparticular, unassigned fund balances may serve as a useful measure of a government’s net resources available forspending at the end of the fiscal year.

For the fiscal year ended December 31, 2012, the governmental funds reported combined ending fund balancesof $115.6 million, an increase of $52.4 million in comparison with the prior year. An increase in fund balance inthe amount of $7.3 million for the Downtown Stadium Fund; an increase in the amount of $5.4 million for theStreet and Highway Allocation Fund; an increase in the Capital City improvement Fund of $4.9 million; anincrease of $3.1 million for the 2010 Parks and Recreation Fund and an increase in fund balance in the amountof $19.1 million for the Grant Funds accounted for the majority of the $48.3 million increase in the nonmajorGovernmental Funds fund balance. The fund balance in the General Fund and Debt Service Fund increased$4.0 million and $0.1 million, respectively.

Approximately 48.7% or $56.2 million of the combined fund balance constitutes committed/assigned/unassignedfund balance, which generally is available for spending at the City’s discretion. The remainder of the fundbalance is restricted to indicate that it is not available for new spending, because it has already been committedto:

o pay debt service ($22.5 million)

o public safety purposes ($1.1 million)

o community development ($2.2 million)

• culture and parks purposes ($6.0 million)

o general government purposes ($6.5 million)

o transportation and street system purposes ($13.7 million)

The General Fund is the City’s chief operating fund. The general fund’s assigned/unassigned fund balance atDecember 31, 2012 is $44.8 million, while the total fund balance is $47.9 million. As a measure of the generalfund’s liquidity, it may be useful to compare both the assigned/unassigned fund balance and the total fundbalance to total fund expenditures. The assigned/unassigned fund balance represents 14.6% of the total fundbalance to total fund expenditures, whereas the total fund balance represents 15.6% of that same amount. Thefund balance of the general fund increased by $4.0 million for fiscal year 2012. For budgeting purposes only, the2012 budget surplus of $9.4 million is available for governmental use.

17 (Continued)

CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

Another major governmental fund is the Debt Service Fund. The Debt Service Fund has a total fund balance ofS 18.7 million, all of which will be used either for payment of debt service on the City’s general obligation debt orfor payment of debt issuance costs. The Debt Service Fund increased by £0.1 million for fiscal year 2012.

General Fund Budgetary Highlights

December 31, 2012

(In millions)

Original Finalbudget budget Actual

Revenues:Taxes $ 272.3 272.3 278.0Intergovernmental 4.9 4.9 4.0Other 34.7 34.7 35.1

Total 311.9 311.9 317.1

Expenditures, lapsed encumbrances,and transfers 314.0 314.2 312.1

Changes in fund balance $ (2.1) (2.3) 5.0

Proprietary Funds

The City’s proprietary funds provide the same type of information found in the governmentwide financialstatements, but in more detail.

Net position of the Convention Center Hotel Fund, Parking Facilities Fund, Sewer Revenue Fund, and otherenterprise funds amounted to S(37.6) million, S(4.8) million, S320.5 million, and S1.5 million, respectively, atDecember 31, 2012. Additional discussion concerning the finances of these funds has already been addressed inthe discussion of the City’s business-type activities.

There are three types of budget transfers, each requiring a successive level of authority. First, the Mayor may, atany time, transfer an unencumbered appropriation balance or portion thereof between appropriations of the samedivision. Second, transfers between divisions in the same department may be authorized by resolution of the CityCouncil. Third, transfers between departments/agencies may be authorized by ordinance of the City Council. Atthe end of the year, the City Council passed a budget amendment to transfer $1.2 million from the General Fundto the Contingent Liability Fund.

Significant variances between the general fund’s actual revenues and expenditures and the final amended budgetare summarized as follows:

• Sales tax revenue was £0.4 million above budget

• In Lieu taxes and Licenses and Permits were $1.1 million below budget

18 (Continued)

CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

• Property tax revenue was $0.6 million above budget

o Business Taxes were $0.9 million above budget

• Restaurant Tax revenues were $5.8 million above budget

o Interest earnings were $0.7 million below budget

o Rents and Royalties and Misc. Revenues were 0.8 million below budget

o Charges for services were $1.4 million above budget

o The Mayor’s Office, City Council, Human Resources, Planning, Parks, Public Works and theLibrary collectively were $1.7 million above budget.

o The City Clerk, Law, Human Rights and Relations, Finance, and Police ended the year $0.6 millionunder budget.

o The Fire Department was $7.2 million over budget.

o Retiree Benefits and Other Agencies were under budget $6.8 million and $4.4 million respectively.

Capital Asset and Debt Administration

Capital Assets

The City’s investment in capital assets for its govemmental and business-type activities as of December 31,2012, is $1.8 billion (net of accumulated depreciation). This investment in capital assets includes land, buildings,improvements, machinery and equipment, streets, bridges, storm sewers, sanitary sewers, event facilities, andwastewater treatment plants. The total change in the City’s investment in capital assets for the current year was anet increase of 3.9% (a decrease of 0.1% for governmental activities and an increase of 11.3% for business-typeactivities).

Governmental Business-type

activities activities Total2012 2011 2012 2011 2012 2011

Land $ 140.1 139.2 5.2 5.2 145.3 144.4Cultural assets 5.8 5.8 0.7 0.7 6.5 6.5Construction in progress 38.4 24.6 107.2 51.7 145.6 76.3Buildings 335.4 345.0 121.9 127.5 457.3 472.5Machinery and equipment 24.1 24.4 13.7 16.0 37.8 40.4Infrastructure 559.8 565.3 413.8 393.9 973.6 959.2

Total $ 1,103.6 1,104.3 662.5 595.0 1,766.1 1,699.3

Major capital asset events during 2012 included the following:

• DOT.Comm Projects for Success infrastructure improvements; current year expenditures were$1.9 million.

19 (Continued)

CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

o Construction continued on the City’s sewer system including the Combined Sewer OverflowProgram with capital outlays of $93.6 million.

o Purchases of fire fighting vehicles, aerial ladder truck; current year expenditures were $0.7 million.

o Construction continued on the 144th and Eagle Run Road Project; current year costs were$1.5 million.

• City wide park renovations and construction of City parks; current year expenses were $5.4 million.

o ADA street ramp compliance construction; current year expenditures were $1.7 million.

Construction and repair on lO street bridge over Leahy Mall; current year expenditures were $0.8million.

o Final construction on the Downtown Ballpark Project; current year expenditures were $1.8 million.

o Construction of street improvements on 48th Street from L to Q; current year expenditures were $1.1million.

• Construction in progress citywide totaled $145.6 million.

o Annual citywide depreciation expense for governmental activities totaled $37.9 million.

Additional information on the City’s capital assets can be found in note 11 to the financial statements on pages76 through 80 of this report.

Long-Term Debt

At December 31, 2012, the City had total bonded debt outstanding of $1 .268 billion (including notes payable).Of this amount, $516.8 million is general obligation debt backed by the full faith and credit of the City;$449.8 million of revenue bonds secured solely by specified revenue sources; $57.9 million of special obligationbonds backed by a variety of revenue sources, including sales tax and property tax; $59.4 million of special taxrevenue bonds backed by a redevelopment property tax levy; $167.9 million of lease purchase bonds backed byannual General Fund appropriations; and $16.4 million of notes payable backed by a variety of revenue sources.

Cit) of Omaha’s Outstanding Debt

(In millions)

Governmental Business-typeactivities activities Total

2012 2011 2012 2011 2012 2011

General obligation bonds S 516.8 518.7 — — 51 6.8 518.7Revenuebonds 1.7 1.9 448.1 358.0 449.8 359.9Special obligation bonds 40.6 43.1 17.3 17.6 57.9 60.7Special tax revenue bonds 59.4 60.5 — 59.4 60.5Leasepurchasebonds 131.1 130.6 36.8 39.4 167.9 170.0Notespayable 2.9 2.2 13.5 13.1 16.4 15.3

Total $ 752.5 757.0 515.7 428.1 1,268.2 1,185.1

20 (Continued)

CITY OF OMAHA, NEBRASKA

Management’s biscussion and Analysis

Year ended December 31, 2012

(Unaudited)

During 2012, the City’s total debt increased by $83.1 million (7.0%). In 2012, the City issued $97.7 million forconstruction of the combined sewer separation project. This issue accounts for the increase in outstanding debt.

At December 31, 2012, the City maintained an AAA rating from Standard & Poor’s Corporation and an Aairating from Moody’s Investors Service on general obligation bonds.

Under the City’s Home Rule Charter, the total amount of general obligation indebtedness outstanding at any timeshall not exceed 3.5% of the actual value of taxable real and personal property in the City. The debt margin as ofDecember 31, 2012, is $478.9 million.

Additional information on the City’s long-term debt can be found in notes 6 and 7 to the financial statements onpages 55 through 65 of this report.

Economic Factors and Next Year’s Budgets and Rates

The City’s property tax base for 2013 is $27.9 billion. This is an increase over 2012 of $430.2 million or 1.6%,primarily due to annexations in 2012. This increase also includes revaluations of existing properties and newgrowth within the City. The property tax rate for 2013 remained the same as 2012 at 49.922 cents per $100 ofvaluation.

o Sales tax collections for 2011 and 2012 have changed, respectively, by (0.2) % and 1.4% over eachof the past two years. For 2012, increased sales tax collections were enough to offset an increase inbusiness incentive tax refunds of $0.9 million. Current net collections through June 2013 show anincrease over the same period in 2012 by 3.9%.

• In the fall of 2011, the City enacted a 2.5% restaurant occupation tax charge on food and beverages.in 2013, the City budgeted restaurant tax revenues at $25.6 million. Collections for 2013 are nowprojected at $25.3 million or $0.4 million under budget.

o Effective January 1, 2013, the state legislature prohibits the City from collecting the wheel tax in thethree mile jurisdiction of Douglas County. This results in a loss of revenue of approximately $3.2million.

• The Sewer Use Fee rate for 2013 increases about 26% over 2012. Anticipated future rate increasesare intended to fund the Combine Sewer Overflow Compliance Project.

• Overall general fund revenue collections for 2013 are projected to be $5.3 million under budget(1.7%) due primarily to LB775 and LB312 sales tax refunds to businesses.

All of these factors were considered in preparing the City’s budget for the 2014 fiscal year.

During 2012, the assigned/unassigned fund balance in the general fund was $44.8 million. The City appropriated$9.4 million of this amount for spending in the 2014 fiscal year. This 2014 appropriation represents the 2012budget balance carried forward. The 2012 budget balance carried forward in the amount of $9.4 million will beappropriated for spending in 2014. The City Charter requires that the general fund budget balance, as of the closeof any particular fiscal year, shall be applied as general fund revenue in the budget for the fiscal year two yearssubsequent to that fiscal year.

21 (Continued)

CITY OF OMAHA, NEBRASKA

Management’s Discussion and Analysis

Year ended December 31, 2012

(Unaudited)

Requests for Information

This financial report is designed to provide citizens, taxpayers, customers, investors, and creditors with a generaloverview of the City’s finances and to demonstrate the City’s accountability for the funds it receives. Questionsconcerning any of the information provided in this report or requests for additional financial information shouldbe addressed to the City of Omaha, Finance Department, Suite 1004, 1819 Famam Street, Omaha, Nebraska68183.

22

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BASIC FINANCIAL STATEMENTS

This page intentionally left blank

CITY OF OMAHA, NEBRASKA

Statement of Net Position

December31, 2012

Liabilities and Net Position

Liabilities:Accounts payable and otherAccrued interest payableDue to other governmentsUnearned revenueLong-term liabilities:

Net pension obligation due in more than one yearPostrctirement benefit obligation due in more than one yearOther liabilitiesCompensated absences:

Due within one yearDue in more than one year

Grants payable:Due within one yearDue in more than one year

Claims and judgments:Due within one year

Workers’ compensation and healthcare claims:Due within one yearDue in more than one year

Bonds, notes, and leases payable:Due within one yearDue in more than one year

Total liabilities

Net position:Net investment in capital assetsRestricted for:

Debt serviceCommunity improvementPerpetual care:

ExpendableNonexpendable

Unrestricted

Total net position

Total liabilities and net position

See accompanying notes to basic financial statements.

— 2,250,000— 13,513,750

— 1,950,000

14,555,22026,596,386

66,780,0491,215,724,325

1,847,594,984

Primary government

Assets

Cash and pooled investmentsI rlvestmentsReceivables (net of allowance for uncollectibles)Due from other governmentsInternal balancesAccrued interestInventoriesOther assetsRestricted assets:

InvestmentsDeposits with trustee

Capital assets:NondepreciableDepreciable

Total assets

Governmentalactivities

$ 43,045,58978,718,896

176,493,00839,955,181

(20,000,000)190,925

2,320,1447,413,234

Business-typeactivities

2,334,350110,938,296

1,762,2415,226,409

20,000,00044,466

787,7385,164,184

Total

45,379,939189,657,192178,255,24945,181,590

235,3913,107,882

12,577,418

Aggregatediscretelypresentedcomponent

unitsTotal

15,552,52221,167,800

3,740,879352,491

2,470,246

653,66916,757,407

60,695,014

21,219,508 21,219,50810,879,942 22,219,931 33,099,873

297,458,6611,468,724,236

2,294,896,939

113,117,750549,435,357

852,250,230

20,788,5524,944,903

317,097

63,093,961 24,860,22411,934,935 —

1,013,345 —

4,973,520

184,340,911919,288,879

S 1,442,646,709

$ 42,305,4096,990,0321,013,3454,656,423

201,734,657137,193,594

3,392,99364,466,877

2,250,00013,513,750

1,950,000

13,703,65425,040,342

52,142,184704,731,238

1,275,084,498

8,729,311 210,463,9687,725,388 144,918,982

98,3331,868,340

3,491,32666,335,217

414,716

1,002,2412,805,837

29,083,018

851,5661,556,044

14,637,865510,993,087

572,510,486

359,649,050 136,922,155 496,571,205 13,602,998

10,879,942 43,439,439 54,319,381 133,2503,331,576 — 3,331,576 —

403,938 — 403,938 —

2,775,389 — 2,775,389 —

(209,477,684) 99,378,150 (110,099,534) 17,875,748

167,562,21 1 279,739,744 447,301,955 31,611,996

$ 1,442,646,709 852,250,230 2,294,896,939 60,695,014

23

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565,

512

Net

posi

tion

begi

nnin

gof

year

200,

107,

231

271,

079,

362

471,

186,

593

30,0

46,4

84

Net

posi

tiott

—en

dof

year

$16

7,56

2,21

127

9,73

9,74

444

7,30

1,95

531

,611

,996

See

acco

tnpa

nyin

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tes

Inba

sic

)iua

ttcia

lsl

atet

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s.

24

CITY OF OMAHA, NEBRASKA

Balance Sheet — Governmental Funds

December31. 2012

Debt Nonmajor Totalservice governmental governmental

Assels General fund funds funds

Cash and pooled investments S 560,317 8,251,165 34,234,107 43,045,589Investments 74,153,277 — 4,565,619 78,718,896Receivables (net ofallosvanee for uncollectibles) 92,676,187 55,699.750 28,117,071 176,493.008Dne front nthergovernments 22,994.025 223.942 16,737,214 39,955,181Due from other funds — 10,371,000 — 10,371,000Accnted interest 130,260 — 60.665 190,925Inventories 2.320,144 — — 2,320,144Other assets 10.722 — 498,899 509,621Restricted assets:

Deposits with tmstee — — 10,879,942 10,879.942

Total assets S 192,844,932 74,545,857 95,093,517 362,484,306

Liabilities and Fund Balances

Liabilities:Accounts payable and other S 32,592,307 169,601 9,543,501 42,305,409Due to other governnsents 988,345 — 25,000 1.013,345Due to other funds 30,371,000 — — 30,371.000Unearned revenue 25.360 17,189 4,613,874 4.656,423Advanced revenue 80.959,039 55.670,014 31.903,083 168,532,136

Total liabilities 144,936,051 55,856,804 46.085.458 246,878,313

Fund balances:Nonspendable 2,320,144 — 2,775.389 5,095,533Restricted 747.561 18,689.053 34,824,332 54,260,946Committed — — 18,704,036 18,704,036Assigned 7,233,035 — 6.691,614 13,924,649Unassigned 37.608.141 — (13,987,312) 23,620,829

47,908,881 18.689,053 49,008.059 115,605,993

Total liabilities atid fund balances S 192,844,932 74,545,857 95,093,517

Amounts reported for governmental activilies in the slatementof net position are different because:

Capital assets used in governmental activities arenot linancial resources and, therefore, are notreported in the funds 1,103,629,790

Revenues earned during the current period are notavailable as resources and, therefore, are recognizedas advanced revenue in the funds 168,532,136

Bond costs of issuance are capitalized at the governmentsvide level and amortized over the life of Ilte relatedbonds 6,903,613

Long-term liabilities. including bonds payable and pensionobligations, are not due and payable in the current periodand. therefore, are not reported in the funds (see note 5) (1,227,109,321)

Net position of governmental activities S 167,562,211

See acconspanying notes to basic financial statements.

25

CITY OF OMAHA, NEBRASKA

Statement of Revenues, Expenditures, and Changes in Fund BalancesGovernmental Funds

Year ended December 31, 2012

PropertyMotor vehicleCity sales and uscBusinessIn lieu

Licenses and permitsIntergovernmentalInvestment incomeRevenue from KenoCharges for servicesRents, royalties, and otherContributions and grants

Total revenues

Expenditures:Current:

General governmentPublic safetyTransportation servicesOther public servicesCommunity developmentCulture and parks

Debt service:PrincipalInterestBond issuance costs

Capital outlay

Total expenditures

Excess (deficiency) of revenuesover expenditures

Other financing sources (uses):Transfers inTransfers outSale of capital assetsProceeds from issuance of bondsProceeds from refunding bondsProceeds from bond premiumDiscount on sale of bondsPayment to refunded bond escrow agent

Total other financing sources

Net change in fund balances

Fund balances beginning of year

Fund balances - end of year

$ 79,123,6159,163,518

128,379,32261,614,154

3,956,0318,417,387

(480)722,382554,533

20,613,005965,061107,663

313,616,191

38,505,619206,990,090

1,113,00916,415,1097,233,401

28,841,517

3,984,8733,045,351

257,258

306,386,227

7,229,964

150,000(3,413,203)

53,660,317 7,931,448

717,49222,322

1,536,24939,720,823

444,9886,665,750

31,462,60221,663,716

_______________

49,882,028

_______________

160,047,418

738,724 9,145,101— 6,758,284

47,853,48713,098,52019,010,163

— 4,966,316

4,896,6537,531,931

492,973

_______________

32,562,258

_______________

146,315,686

(579,570) 13,731,732

— 2,176,735— (2,077,007)

658,00042,555,86235,067,0654,073,894

(3,922)

______________

(47,877,188)

______________

34,573,439

48,305,171

140,715,3809,163,518

128,379,32262,331,6464,174,5229,953,636

41,896,0212,133,5067,220,283

54,709,03122,628,77752,404,647

535,710,289

48,389,444213,748,374

48,966,49629,513,62926,243,56433,807,833

47,062,14033,803,919

973,24832,819,516

515,328,163

20,382,126

2,326,735(5,490,210)

658,00077,890,86235,067,065

8,380,765(3,922)

(86,845,834)

31,983,461

52,365,587

See accompanying notes to basic financial statements.

Revenues:Taxes:

General

Debt Nonmajor Totalservice governmental governmentalfund funds funds

196,169

2,175,678966,136

2,633,424

2,414,956

62,046,680

38,180,61423,226,637

480,275

62,626,250

35,335,000

4,306,871

(38,968,646)

673,225

93,655

(3,263,203)

3,966,761

43,942,120 1 8,595,398 702,888 63,240,406

$ 47,908,881 18,689,053 49,008,059 115,605,993

26

CITY OF OMAHA, NEBRASKA j5Reconciliation of the Change in Fund Balances of Governmental Funds

to the Statement of Activities — Governmental Funds

Year ended December 31, 2012

Amounts reported for governmental activities iii the statement of activitiesare different because:

Net change in fund balances — total governmental funds $ 52,365,587Governmental finds report capital outlays as expenditures. However, in the

statement of activities, the cost of those assets is allocated over their estimateduseful lives and reported as depreciation expense. This is the amount by whichcapital outlays exceeded depreciation expense in the current period (see note 5). (5,081,487)

The net effect of various miscellaneous transactions involving capital contributionsand sale of capital assets. 901,969

Revenues in the statement of activities that do not provide current financialresources are not reported as revenues in the funds. (19,604,284)

The issuance of long-term debt (e.g., bonds, leases, etc.) and long-term liabilitiesprovides current financial resources to governmental funds, whereas therepayment of the principal of long-term debt consumes the current financialresources of governmental funds. Neither transaction, however, has any effecton net position. Also, governmental funds report the effect of issuance costs,premiums, discounts, and similar items when debt is first issued, whereas theseamounts are advanced and amortized in the statement of activities. This amountis the net effect of these differences in the treatment of long-term debt andrelated items (see note 5). 1,651,233

Some expenses reported in the statement of activities do not require the use ofcurrent financial resources and, therefore, are not reported as expenditures inthe governmental funds (see note 5). (62,778,038)

Change in net position of governmental activities S (32,545,020)

See accompanying notes to basic financial statements.

27

CITY OF OMAHA, NEBRASKA

Statement of Net Position —

Proprietary Funds

December 3!, 2012

Sewer Nonmajor TotalConvention Parking revenue enterprise proprietary

Assets Center Hotel facilities fund funds funds

Current assets:Cash and casts equivalents S 159 1,088,532 353,076 892,583 2,334,350Investments

— 110,938,296 — 110,938,296Prepaids

— 6,742 — 10,000 16,742Receivables met of allowance for uncottectibles) — 171,726 1,420,249 170,266 1,762,241Due from other governments — — 5,226.409 — 5,226,409Accrued interest receivable 173 — 44,293 — 44,466Inventories —

— 759,374 28,364 787,738Due from other funds — — 20,000000 27,000 20,027,000Restricted assets:

Investments —— 11,960,039 — 11,960,039

Deposits svith trustee 4,324,014

________________

— — 4,324,014

Total current assets 4,324,346 1,267,000 150,701,736 1,128,213 157,421,295

Noncurrent assets:Restricted assets:

Investments —— 9,259,469 — 9,259,469

Deposits svith trustee 17,895,917 — — 17,895,917Advanced charges 2.232,618 275,936 2,636,459 2,429 5,147,442

Capital assets:Land 2,473,344 2,721,046 — 5,194,390Buildings and systems 90,781.991 61,363,255 755,721,784 9,228,130 917,095,160Furniture and fixtures 14,343,347 — — 14,343,347Machinery and cqnipmcnt 3,974,072 — 10,089.056 2,852,482 16,915,610Cullurat assets 718,020 — — 718,020Construction in progress -

— 107,205,340 — 107,205,340

109,817.430 63,836,599 875,737,226 12,080,612 1,061,471.867

Less accumulated depreciation 24,544,708 33.148,427 334,024,784 7,200,841 398,918,760

Capital assets, net 85,272,722 30,688,172 541,712,442 4.879,771 662,553,107

Total noncurrent assets 105,401,257 30,964,108 553,608,370 4,882,200 694,855,935

Total assets S 109,725.603 32,231.108 704,310,106 6,010,413 852,277,230

Liabilities and Net Position

Current liabilities:Acconnts payable and other current liabililies 5 70,032 206,991 20,263,166 248,363 20,788,552Accrned interest payable 3,164,014 540,073 1,237,174 3,642 4,944,903Unearned revenue

— 270,460 46,637 317,097Current installments of long-term debt 1,160,000 2,730,000 10,722,865 25,000 14,637,865Workers’ compensation and healtbcare claims — 5,822 646.317 199,427 851,566Due to other funds 27.000 — — — 27,000Compensated absences — 17 80.963 17,353 98.333

Total current liabilities 4,421,046 3,482,903 33,220,945 540,422 41,665,316

Noncurrent liabililies:Long-term debt, excluding current installments 42,894,053 33,400,162 334,377,171 321,701 510,993,087Pension obligation

— 46,740 7,131,722 1,550,849 8,729,311Postretirement benefit obligation — 41,366 6,311,529 1,372,493 7,725,388Workers’ compensation and henllhcare claims —- 10,640 1,180,998 364,406 1,556,044Compensated absences

— 329 1,538,291 329,720 1,868,340

Total noncurrent liabilities 142,894.053 33,499.237 350.539,711 3,939.169 530,872,170

Total liabilities 147,315,099 36.982,140 383,760,656 4,479,591 572,537,486

Net positionNet investnsent in capital assets (58,781,331) (5,441,990) 196,612,406 4,533,070 136,922,155Restricted for debt service 22,219,931 — 21,219,508 43,439,439Unrestricted (1,028.096) 690,958 102,717.536 (3,002,248) 99,378,150

Total net posilion 137,589,496) (4.751,032) 320.549,450 1,530,822 279,739,744

Total liabilities and net position S 109.725,603 32,231,108 704.310,106 6,010,4t3 852,277,230

See acconspanying notes to basic financial slatements.

28

CITY OF OMAHA, NEBRASKA

Statement of Revenues, Expenses, and Changes in Net PositionProprietary Funds

Year ended December31, 2012

Convention Sewer Nonmajor TotalCenter Parking revenue enterprise proprietaryHotel facilities fund funds funds

Operating revenues:Charges for services S 11,147,600 4,064,700 73,321,440 7,244,940 95,778,689

Total operating revenues 11,147,600 4,064,700 73,321,449 7,244.940 95,778,689

Operating expenses:Personal services — 103.121 17,086,095 3,621,586 20,810,802Outside services 146,498 1,552,660 9,461.741 1,217,276 12,378,175Operation and maintenance 1,360,197 65,411 8,478,241 1,619,674 11,523,523Cost of sales and services — — 276,785 276,785Depreciation and amortization 5,442,663 2,410,197 19,039,886 442,464 27,335,210

Total operating expenses 6,949.358 4,131,389 54,065,963 7.177,785 72,324.495

Operating income (lossl 4,198.242 (66,689) 19,255,486 67,155 23,454,194

Nonoperating revenues (expenses):Investment income 100,405 — 306,156 — 406,561Interest expense (9.810.798) (1,902,040) (7,980,699) (15,587) 119,709,124)Oain on disposal of assets — — 9,000 — 9.000

Total nonoperating revenues (expenses), net (9,710.393) (1.902,040) (7,665,543) (15,587) (19,293,563)

Inconse (loss) before contributions and transfers (5,512,151) (1,968.729) 11,589,943 51,568 4,160,631

Transfers in — 2,446.3 19 913,870 — 3,360,189Transfers out — — (196,712) — (196,712)Cotitrihnted capital — — 1,236,274 100,000 1,336.274

Chaitge ut net position (5,512.151) 477,590 13,543,375 151,568 8,660,382

Net positiott at beginnittg of year (32,077,345) (5,228,622) 307,006,075 1,379.254 271,079.362

Net position at end of year S (37.589,496) (4,751.032) 320,549,450 1,530,822 279,739,744

See accompanying notes to basic titiancial statements.

29

CITY OF OMAHA, NEBRASKA

Statement of Cash Flows — Proprietary Funds

Year ended December 31, 20 2

Cash flows front operating activities:Receipts from customersPayments to suppliersPayments to employees

Net cash provided by operating activities

Cash flosvs from noitcapital financing activities:Transfers in/osttAdvances front (to) otlter fttnds

Net cash provided by (itsed in) ttoncapitalfinancing activities

Cash flows from capital and related financing activities:Capital expenditttresCapital contributedDebt issoance costsPayments Ott long-term debtlsstiance of long-term debtPrentiutti received on issuance

of long-term debtInterest paid

Net cash used in capital and relatedfinancing activities

Cash flows front ittvesting activities:Net sale/pttrcltases of investment securities, netInterest received

Net cash provided by (itsed in) ittvestittg activities

Net increase (decrease) in cash and cash equivalents

Cash and cash eqttivalents, beginning of year

Caslt and cash eqttivalettts, end of year

Recottciliation of operating incoitse (loss) to itet cash provided byoperating activities:

Operating ittcottle (loss)Adjttstmeitts to reconcile operating income (loss) to set cash provided

by (ttsed in) operatittg activities:Depreciation and amortizationCaslt tlosvs intpacted by chattges in:

ReceivablesInventoriesPrepaidsAcconitts payable attd otherClainis payableCompensated absencesPension obligationPostretiremeitt benefit obligatiott

Net cash provided by operating activities

See accottipattying notes to basic flnattcial statetrtents.

2,446,319 717,158(2,296,829) 1,003 (990,657)

(2,296,829) 2.447,322 (273,499)

(1.156,833) — (93,594,034)—

— 1,236,27456,886 58,813 (554,174)

(640.000) (2,635,000) (25,064.847)—

— 115,777,635

S 4,198.242 (66,689) 19,255,486

5,442,663 2,410,197 19,039,886

20,78069,536

(496,254)10,248,192

243,864(64,220)

1,288,035

______________ ______________

1,060.960

________________ ________________

50,666,265

ConventionCenterHotel

S 11,147,600(2,977,781)

8,169.819

Sewer Nonmajor TotalParking revenue enterprise proprietaryfacilities fund funds funds

4,117,336(1,517,900)

(95,955)

2,503,481

73,612,689(8,388,968)

(14,557,456)

50,666,265

7,253.333(2,991,726)(3.393,968)

867,639

96,130,958(15.876,375)(18,047,379)

62,207.204

3,163,477(1,421,050) (4,707,533)

(1,421,050)

(63,585)100,000

(25,000)

(1,544,056)

(94.814.452)1.336.274(438,475)

(28,364,847)115,777,635

—— 9,617,815 — 9.617,815

(7,663,319) (1,927,163) (7,940.477) (15,694) (17,546.653)

(9,403,266) (4,503,350) (521,808) (4.279) (14,432,703)

3.379.467150,968

3.530.435

159

S 159

447,453

641,079

1,088,532

(81,717,492)310,149

(81,407.343)

(31,536,385)

31.889,461

353.076

(557.690)

1.450,273

892,583

(78,338,025)461,117

(77,876,908)

(31.646,463)

33.980,813

2.334.350

67,155 23,454,194

98.709(1,569.795)

S 8.169.819

52,636

27,09173,080

2603.9702,936

2,503,481

442,464

(28.244)(18,505)

(9,934)87.085(8,827)

135,578100,867

867.639

27,335,210

45,17251,031

(380,388)8,938,562

235,297(60,250)

1,426,5491,161.827

62.207,204

30

CITY OF OMAHA, NEBRASKA

Statement of Fiduciary Net Position —

Fiduciary Funds

December 31, 2012

TotalPension Trust Fiduciary

Funds Agency Funds

Assets:Cash and cash equivalents $ 813,226 8,318,297 9,131,523Receivables:

Accounts receivable 1,813,415 33,565 1,846,980Accrued interest 2,067,995 1,325 2,069,320

Due from other governments 1,089 1,089Due from other funds 1,221,300 1,221,300investments, at fair value:

Government securities 37,312,465 1,196,423 38,508,888Municipal issues 3,879,158 — 3,879,158Corporate bonds 117,525,803 117,525,803Domestic equities 227,181,818 — 227,181,818International equities 125,170,190 125,170,190Domestic real estate securities 133,107,674 133,107,674International real estate 1,503,535 1,503,535Commodities 33,493,365 33,493,365Private equity 12,059,269 — 12,059,269Cash and cash equivalents 19,508,721

_______________

19,508,721

Total assets 715,437,723 10,770,910 726,208,633

Liabilities:Accounts payable and other liabilities 2,404,496 10,770,910 13,175,406

Total liabilities 2,404,496 10,770,910 13,175,406

Net position held in trust for pension benefits $ 713,033,227 713,033,227

See accompanying notes to basic financial statements.

31

CITY OF OMAHA, NEBRASKA

Statement of Changes in Fiduciary Net Position —

Pension Trust Funds

Year ended December 31, 2012

Additions:Contributions:

Employer $ 42,518,087Employee 25,843,583

Total contributions 68,361,670

Investment earnings:Dividends and interest 21,004,508Net increase in the fair value of investments 61,057,680

Total investment earnings 82,062,188

Less investment expenses (3,853,291)

Net investment income 78,208,897

Total additions 146,570,567

Deductions:Benefit payments 89,401,515

Change in net position 57,169,052

Net position, beginning of year 655,864,175

Net position, end of year $ 713,033,227

See accompanying notes to basic financial statements.

32

CITY OF OMAHA, NEBRASKA

Discretely Presented Component UnitsCombining Statement of Net Position

December 31, 2012

WorkforceAssets MECA Solutions Total

Cash and pooled investments $ 15,243,146 309,376 15,552,522Investments 21,167,800 21,167,800Receivables (net of allowance for uncollectibles) 3,731,277 9,602 3,740,879Due from other governments 352,491 352,491Other assets 2,470,246 2,470,246Capital assets:

Nondepreciable 653,669 653,669Depreciable 16,648,226 109,181 16,757,407

Total assets $ 59,914,364 780,650 60,695,014

Liabilities and Net Position

Liabilities:Accounts payable and other $ 24,566,810 293,414 24,860,224Long-term liabilities:

Other liabilities 396,105 18,611 414,716Bonds, notes, and leases payable:

Due within one year 1,002,241 1,002,241Due in more than one year 2,805,837 2,805,837

Total liabilities 28,770,993 312,025 29,083,018

Net position:Net investment in capital assets 13,493,817 109,181 13,602,998Restricted 133,250 133,250Unrestricted 17,649,554 226,194 17,875,748

Total net position 31,143,371 468,625 31,611,996

Total liabilities and net position $ 59,914,364 780,650 60,695,014

See accompanying notes to basic financial statements.

33

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34

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(1) Summary of Significant Accounting Policies

(a) Reporting Entity

The City of Omaha, Nebraska (the City) was incorporated on February 2, 1857. The City operatesunder a Home Rule Charter and has a mayor-council form of government with an elected full-timechief executive, the Mayor, and an elected legislative body, the council, composed of sevenmembers. The seven council members each represent one of the City’s seven districts. The Mayorand members of the council are elected through popular vote to four-year terms. The City is apolitical subdivision of the state of Nebraska and is exempt from state and federal income taxes.

The governmental reporting entity consists of the City (the primary government) and its componentunits. Component units are legally separate organizations for which the City is financiallyaccountable or other organizations whose nature and significant relationship with the City are suchthat exclusion would cause the City’s financial statements to be misleading or incomplete. Financialaccountability is defined as the appointment of a voting majority of the component unit’s board and(i) either the City’s ability to impose its will on the organization or (ii) there is potential for theorganization to provide financial benefit to or impose a financial burden on the City.

The basic financial statements include both blended component units and the City’s discretelypresented component units. The blended component units, although legally separate entities, are, insubstance, part of the City’s operations, and data from these units are basic with data of the primarygovernment. The City’s basic financial statements blend the activity of the City of Omaha ParkingFacilities Corporation, the City of Omaha Impound Facilities Corporation, the City of OmahaStadium Facilities Corporation, City of Omaha Northwest Library Facilities Corporation, the City ofOmaha Facilities Corporation, and City of Omaha Convention Hotel Coiporation. The City isfinancially accountable for these organizations and they provide services entirely to the City ofOmaha.

The City reports its respective ownership percentage of the assets, liabilities, net position, andoperating activity of the Omaha-Douglas Public Building Commission (the Commission). Separatefinancial statements are available at 1819 Famam Street, Omaha, Nebraska 68183.

The City has engaged in related-party transactions as defined under Governmental AccountingStandards Board (GASB) Statement No. 56, Codification of Accounting and Financial ReportingGuidance Contained in the AICPA Statements on Auditing Standards, with the Omaha HousingAuthority, Omaha Airport Authority, and Metro Transit Authority where the Mayor or City Councilappoints board members to these organizations. The City’s accountability for these organizationsdoes not extend beyond making the appointments.

The discretely presented component units, on the other hand, are reported in separate columns in thegovernmentwide financial statements to emphasize that they are legally separate from the primarygovernment. The City’s basic financial statements discretely present the financial position andactivities of the Metropolitan Entertainment and Convention Authority (MECA) and HeartlandWorkforce Solutions (HWS).

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Metropolitan Entertainment and Convention Authority

Metropolitan Entertainment and Convention Authority (MECA) is a separate nonprofitcorporation that is responsible for the operation of the Omaha Convention Center/Arena, CivicAuditorium, and Downtown Stadium. Title to the facilities and all related infrastructure assetsare vested with the City. Construction activities were principally funded by private donations andgeneral obligation bonds of the City. Board members of MECA are appointed by the City. Thefinancial statements for MECA included herein are for the year ended June 30, 2012. MECA’sseparate financial statements are available at 1819 Famam Street, Omaha, Nebraska 68183.

Heartland Workforce Solutions

Heartland Workforce Solutions (HWS) is a separate 501(c)(3) nonprofit corporation that wasfonned in October 2010. HWS administers the Workforce Investment Act to expandemployment opportunities for youth, adults, and dislocated workers in Douglas, Sarpy, andWashington Counties in Nebraska. The organization receives the majority of its funding from theCity of Omaha as pass-through federal funds. The Mayor of the City of Omaha is the chiefelected official of the Tn-County workforce area. The Mayor appoints all board members andapproves HWS’s budget. The financial statements for HWS included herein include the periodfor fiscal year ended June 30, 2012. Separate financial statements for HWS are available at 1819Farnarn Street, Omaha, NE 68183.

Related Organizations

The City’s officials are responsible for appointing members of the boards of other organizations, butthe City’s accountability for these organizations does not extend beyond making the appointments.The Mayor or City Council appoints board members of the Omaha Housing Authority, the OmahaAirport Authority, and the Metro Area Transit Authority. The City is not financially accountable forthese organizations.

The Douglas Omaha Technology Commission (DOT.Comm) is a governmental entity formed by aninterlocal agreement between the City and Douglas County (the County). The purpose of this entityis to increase the cooperative efforts of the County and the City in connection with electronicinformation, voice, and data communication services for governmental operations, and publicservices. The Mayor appoints two members of the DOT.Comm Oversight Committee, which has atotal of seven members. The City Finance Director is a permanent member of the OversightCommittee. DOT.Comm has control over its operations and fiscal matters and holds title to its assets.DOT.Comm’s revenues are primarily derived from maintenance fees from the City and County.Separate financial statements can be obtained from its office at 408 South 18th Street, Omaha,Nebraska 68102.

(b) Basis ofPresentation

Governmentwide Financial Statements

The statement of net position and statement of activities display information about the primarygovernment and its component units. These statements include the financial activities of the overallgovernment, except for fiduciary activities. Eliminations have been made to minimize interfund

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Notes to Basic Financial Statements

December 31, 2012

activities. These statements distinguish between the governmental and business-type activities of theCity and between the City and its discretely presented component units. Governmental activities,which normally are supported by taxes and intergovernmental revenues, are reported separately frombusiness-type activities, which rely to a significant extent on fees charged to external parties.

The statement of activities presents a comparison between direct expenses and program revenues forthe business-type activities of the City and for each function of the City’s governmental activities.Direct expenses are those that are specifically associated with a program or function and, therefore,are clearly identifiable to a particular function. Program revenues include (1) charges paid by therecipients of goods or services offered by the programs and (2) grants and contributions that arerestricted to meeting the operation or capital requirements of a particular program. Revenues that arenot classified as program revenues, including all taxes, are presented as general revenues.

Fund Financial Statements

The fund financial statements provide information about the City’s funds, including fiduciary funds.Separate statements for each fund category — governmental, proprietary, and fiduciary — arepresented. 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 separatelyaggregated and reported as nonmajor funds.

Proprietary fund operating revenues, such as charges for services, result from exchange transactionsassociated with the principal activity of the fund. Exchange transactions are those in which eachparty receives and gives up essentially equal values. Nonoperating revenues, such as investmentearnings, result from nonexchange transactions, or ancillary activities.

The City reports the following major governmental funds:

o The general find is used to account for all revenues and expenditures necessary to carry outbasic governmental activities of the City that are not accounted for through other funds.

• The debt service fund is used to account for the resources for, and the payment of, generallong-term debt principal, interest, and related costs.

The City reports the following major proprietary funds:

o The convention center hotel fund is used to account for costs associated with the constructionand operation of the Convention Center Hotel.

e The parking facilities fund accounts for activity from parking revenue and related expendituresfor operation, maintenance, and construction of parking garages.

• The sewer revenue fund accounts for activity from sewer service charges, construction grants,and related expenditures for operation, maintenance, and capital improvements of the sanitarysewerage system and wastewater treatment plants.

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

The City reports the following additional fund types:

o The pension trust funds accumulate contributions from the City and its employees andearnings from the funds’ investments. Disbursements are made from the funds for pensionpayments to City retirees.

o The agency funds account for assets held by the City as an agent for various localgovernments.

o The permanent funds are used to report resources that are legally restricted to the extent thatearnings, and not principal, may be used for purposes that support the City’s programs for thebenefit of the City or its citizenry.

The special revenue funds account for the proceeds from specific revenue sources that arerestricted to expenditures for specified purposes.

• The capital projects funds account for all resources received and used for the acquisition ordevelopment of major capital improvements (other than those financed by proprietary fundsand trust funds).

o The enterprisefinds account for operations that are financed and operated in a manner similarto private business enterprises: (a) where the intent of the governing body is that the costs ofproviding goods or services to the general public on a continuing basis are financed orrecovered primarily through user charges or (b) where the governing body has decided thatperiodic determination of revenues earned, expenses incurred, andlor net income is appropriatefor capital maintenance, public policy, management control, accountability, or other purposes.

(c) Basis ofAccounting

The governmentwide, proprietary, and fiduciary fund financial statements are reported using theeconomic resources measurement focus and the accrual basis of accounting. Revenues are recordedwhen earned and expenses are recorded at the time liabilities are incurred, regardless of when therelated cash flows take place. Nonexchange transactions, in which the City gives (or receives) valuewithout directly receiving (or giving) equal value in exchange, include property and sales taxes,grants, entitlements, and donations. On an accrual basis, revenue from property taxes is recognizedin the fiscal year for which the taxes are levied. Revenues from grants, entitlements, and donationsare recognized in the fiscal year in which all eligible requirements have been met.

Governmental funds are reported using the current financial resources measurement focus and themodified accrual basis of accounting. Under this method, revenues are recognized when measurableand available. Property and sales taxes, interest, certain state and federal grants, and charges forservices are accrued when their receipt occurs within 60 days after the end of the accounting periodso as to be both measurable and available. Expenditures are generally recorded when a liability isincurred, except for debt service expenditures and other long-term liabilities, which are recordedonly when due. General capital assets acquisitions are reported as expenditures in governmentalfunds. Proceeds and issuances of long-term debt are reported as other financing sources and uses.

Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operatingrevenues and expenses generally result from providing services and producing and delivering goods

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

in connection with a proprietary fund’s principal ongoing operations. The principal operatingrevenues of the enterprise funds are charges to customers for goods and services. Operating expensesinclude the cost of sales and service, administrative expenses, and depreciation on capital assets. Allrevenues and expenses not meeting this definition are reported as nonoperating revenues andexpenses.

(d) Pooled Cash and Investments

The City maintains a pooled cash and investment account for all funds. These funds are placed in thecustody of the City Treasurer. Each fund reports its undistributed interest in the principal balance ofthe pooi. Interest earned on the City’s pooled cash and investments is credited to the general fund ofthe City, except for the Don Hayes Memorial Fund, Ralph Anderson Memorial Fund, Cash ReserveFund, Western Heritage/Byron Reed Fund, Asarco Remediation Fund, Sewer Revenue Fund, andSewer Construction Fund, which are credited directly to the respective funds. Interest is imputed andtransferred to the Keno funds, Police Seized Assets funds, Law Enforcement Block Grant funds, andWestern Heritage fund.

(e) Cash and Cash Equivalents

For purposes of the accompanying statement of cash flows, the City’s enterprise funds consider allhighly liquid debt instruments with an original maturity of three months or less when purchased to becash equivalents.

Q9 Investments

Investments are stated at fair value. Securities traded on a national or international exchange arevalued at the last reported sales prices at current exchange rates and where marketable securities arenot listed on an exchange, quotations are obtained from brokerage firms or national pricing services.Income from investments not included in pooled cash and investments that are held by individualfunds is recorded in the respective funds as it is received. Accrued interest is recorded at year-end.

(g) Inventories

Inventories of materials and supplies are stated at the lower of cost or market using the first-in,first-out method. The costs of govemmental fund inventories are recorded as assets when purchasedand expended as used.

(h) Revenue

• Property tax: Nebraska Legislative Bill (LB) 1114 imposes a tax ceiling for general revenuepurposes. The tax levy certified in any year shall not exceed $0.45 per $100 of actual valuation.The 2012 general tax levy ($0.28447 per $100 of assessed valuation) was below the legal limitby $0.16553, or $45,493,374.

The Home Rule Charter of the City imposes a tax ceiling for general revenue purposes. The taxlevy certified in any year shall not exceed $0.6l25 per $100 of actual valuation plus whatevertax levy is necessary to provide for principal and interest payments on the indebtedness of theCity for administrative expenses incurred in issuing and maintaining bonds and for satisfactionof judgments and litigation expenses in connection therewith. The 2012 general tax levy

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

($0.28447 per $100 of assessed valuation) was below the legal limit by $032803, or$90,154,000. The assessed value upon which the 2012 levy was based was $27,483,461,755.

The tax levies for all political subdivisions in Douglas County are certified by the county boardon or before October 15. Real estate taxes are due and become an enforceable lien on propertyon December 31. The first half of real estate taxes becomes delinquent on April 1 and thesecond half becomes delinquent on August 1 following the levy date. Personal property taxesare due on December 31 and become delinquent on April 1 and August 1 following the levydate. Delinquent taxes bear 14% interest.

• Motor vehicle tax: Motor vehicle tax is imposed upon all motor vehicles registered for operationupon the highways of the State of Nebraska. The tax is imposed at the rates authorized by theState and in the manner and for the puose specified. The Motor Vehicle Tax is assessed on avehicle at the time of initial registration and annually thereafter until the vehicle reaches 14years of age or more. It is based upon the Manufacturer’s Suggested Retail Price of the vehicle.

o City sales and use tax: A tax imposed upon the sale transactions within the corporate limits ofthe City on which the State is authorized to impose a tax according to the provisions of theNebraska Revenue Act of 1967. Sales tax collected by the State is remitted to the City twomonths after the month of sale. The tax is 1.5% that is added to the 5.5% State Sales Tax set bythe Nebraska Legislature. (The State Department of Revenue retains a 3% collection charge onall of the City’s sales tax receipts.) This revenue pays the City’s day-to-day operations.

• Business tax: Includes the cable television franchise fee, hotel/motel occupancy tax, kenoadministrative fee, occupation tax—Omaha Public Power District, occupation tax—Metropolitan Utilities District, stadium concessions, vehicle rental occupation tax, and vendingmachines concessions. These fees/taxes were implemented to raise money for the City and tofund special projects.

• License and permits: Includes various licensing fees, permit fees, and other fees related toprofessional/business activities (beer and liquor permits, firearm permits, pawnbroker’s permits,theater permits). A majority of these fees were implemented to raise money for the City;however, some items were implemented to regulate businesses and professionals that require alicense or permit to practice.

o Charges for services: Includes various fees and surcharges related to professional and businessactivities (asbestos removal, parking meters, swimming fees, tree removal). A majority of thesefees were implemented to raise money for the City in order to recover costs of maintenance,upkeep of public property, administration costs, and costs related to the service provided by theCity.

(i) Capital Assets

Within the governmentwide and proprietary fund financial statements, capital assets, includinginfrastructure, are recorded at historical cost or at estimated historical cost if actual historical cost isnot available. Contributed fixed assets are valued at their estimated fair market value on the date ofdonation. Capital assets include public domain infrastructure, including roads and bridges. The City

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

defines capital assets as assets with individual costs of more than $10,000 and estimated useful livesin excess of one year. Capital assets used in operations are depreciated or amortized using thestraight-line method over the lesser of the capital lease period or their estimated useful lives in thegovemmentwide and proprietary fund financial statements. Assets are depreciated using thehalf-year convention in the first and last years of the asset’s useful life.

The estimated useful lives are as follows:

Infrastructure 15 — 50 yearsBuildings and systems 15 — 50 yearsImprovements 5 — 30 yearsMachinery and equipment 5 —20 yearsVehicles 5 — 15 yearsFurniture and Fixtures 5 — 7 years

Net interest costs on funds borrowed to finance the construction are capitalized and depreciated overthe life of the related asset.

(1) Compensated Absences

Employees earn annual vacation and sick leave at various specific rates during their period ofemployment. In the event of termination, an employee is reimbursed for accumulated vacation time.This balance is the total of a yearly carryover, up to a maximum of 280 hours for civilian bargainingand civilian management employees, plus the current year’s leave balance. Civilian management andbargaining employees are reimbursed for a percentage of accumulated sick leave up to a maximumof 2,000 hours (612.5 maximum paid hours). Civilian and nonexempt management employees havethe option of accruing compensatory leave time at a rate of one and one half times the actual hoursworked in lieu of the payment of overtime. Employees may accrue a maximum of 120 hours ofcompensatory time. The compensatory time must be taken within three months after the end of thecalendar year in which it is earned and any remaining amounts are paid out in cash. However, theemployee retains the right to cash out the compensatory leave balance at any time.

In the event of termination, police employees are reimbursed for accumulated vacation time up to amaximum of 320 hours, plus the current year leave balance. Upon retirement, death, or resignationafter 20 years, police employees receive I for 1 for the first 1,200 hours of accumulated sick leaveand 1 for 4 hours thereafter up to a maximum of 3,200 hours (1,700 hours). Police employees mayaccrue a maximum of 360 hours of compensatory time. In the event of termination, Fire Department24-hour shift employees are reimbursed for accumulated vacation time up to a maximum of 432hours, plus current year accumulation. Upon retirement or resignation, Fire Bargaining 24-hour shiftemployees are reimbursed for accumulated sick leave at 65% of actual hours. In the event oftermination, Fire Management employees are reimbursed for accumulated vacation time up to amaximum of 280 hours, plus current year accumulation. Upon retirement, Fire Managementemployees are reimbursed for accumulated sick leave 1 for 1 for the first 1,200 hours and 1 for 4 forall hours greater than 1,201 to 3,200 for a maximum 1,700. In the event of termination, FireDepartment 40-hour shift employees are reimbursed for accumulated vacation time up to a maximumof 291.48 hours, plus current year accumulation. Upon retirement or resignation, 40-hour shift

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

employees are converted to 24-hour shift employees reimbursed for accumulated sick leave asabove.

For the governmentwide, proprietary, and fiduciary fund financial statements, vacation leave andother compensated absences with similar characteristics are accrued as the benefits are earned if theleave is attributable to past service and it is probable that the City will compensate the employees forsuch benefits. Such accruals are based on current salary rates and include salary-related payments,such as the employer’s matching Social Security and Medicare costs, associated with payments madefor compensated absences on termination. In the governmental funds, a liability for these amounts isreported only if they are due as a payable.

(k) Risk Management

The City is exposed to various risk of loss related to torts, theft of, damage to, and destruction ofassets; errors and omissions; injuries to employees; and natural disasters. The City is self-insuredwith respect to its obligation to provide workers’ compensation, general liability, property damage,unemployment benefits, and health and dental coverage.

The City purchases commercial insurance for property damage of City buildings and contents. TheCity purchases commercial insurance for aviation liability for the police aviation unit.

(1) Long- Term Obligations

In the governmentwide financial statements and proprietary fund types in the fund financialstatements, long-term debt and other long-term obligations are reported as liabilities in the applicablegovernmental activities, business-type activities, or proprietary fund type statement of net position.Bond premiums and discounts, as well as issuance costs, are advanced and amortized over the life ofthe bonds using the straight-line method. Bonds payable are reported net of the applicable bondpremium or discount. Bond issuance costs are reported as advanced charges and other assets andamortized over the term of the related debt on a straight-line basis.

In the fund financial statements, governmental fund types recognize bond premiums and discounts,as well as bond issuance costs, during the current period. The face amount of debt issued is reportedas other financing sources. Premiums received on debt issuances are reported as other financingsources, whereas discounts on debt issuances are reported as financing uses. Issuance costs, whetheror not withheld from the actual debt proceeds received, are reported as current expenditures.

(in) Interfund Transactions

Interfund transactions are reflected as either loans, services provided, reimbursements, or transfers.Loans, which are reported as receivables and payables, are subject to elimination upon consolidationand are referred to as either “due to/from other funds” or “advances to/from other funds.”

Services provided, deemed to be at market or near market rates, are treated as revenues andexpenditures/expenses. Reimbursements are when one fund incurs a cost, charges the appropriatebenefiting fund, and reduces its related cost as a reimbursement. All other interfund transactions aretreated as transfers. Transfers between governmental or proprietary funds are netted as part of thereconciliation to the govemmentwide presentation.

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Notes to Basic Financial Statements

December 31, 2012

(n) Restricted Assets

Restricted assets include deposits with trustees of various enterprise funds and capital projects.

(o) Recent Accounting Pronouncements

Adoption of New Accounting Pronouncements

In November 2010, GASB issued Statement No. 60, Accounting and Financial Reportingfor ServiceConcession Arrangements. The objective of this statement is to improve financial reporting byaddressing issues related to service concession arrangements (SCA5), which are a type ofpublic-private or public-public partnership. This guidance was effective for the City for the yearended December 31, 2012. The City does not have SCAs that fall under this guidance.

In December 2010, GASB issued Statement No. 62, Codification of Accounting and FinancialReporting Guidance Contained in Pre-November 30, 1989 Financial Accounting Standards Board(FASB) and American Institute of Certified Public Accountants (AICP4) Pronouncements. Theobjective of this statement is to incorporate into the GASB’s authoritative literature certainaccounting and financial reporting guidance that is included in the following pronouncements issuedon or before November 30, 1989, which does not conflict with or contradict GASB pronouncements:FASB Statements and Interpretations; Accounting Principles Board Opinions; or AccountingResearch Bulletins of the AICPA Committee on Accounting Procedure (collectively referred to asthe FASB and AICPA pronouncements). The guidance was effective and was adopted by the Cityfor the year ended December 31, 2012.

In June 2011, GASB issued Statement No. 63, Financial Reporting of Deferred Ou(fiows ofResources, Deferred Inflows of Resources, and Net Position. This statement provides financialreporting guidance for presentation of certain deferred outflows of resources and deferred inflows ofresources and was effective and was adopted by the City for the year ended December 31, 2012.

In June 2011, GASB issued Statement No. 64, Derivative Instruments: Application of HedgeAccounting Termination Provisions, an amendment of GASB Statement No. 53. The objective of thisstatement is to clarify whether an effective hedging relationship continues after the replacement of aswap counterparty or a swap counterparty’s credit support provider. This statement sets forth criteriathat establish when the effective hedging relationship continues and hedge accounting shouldcontinue to be applied. The requirements of this statement were effective for the City for the yearended December 31, 2012.

New Accounting Pronouncements Not Adopted

In November 2010, GASB issued Statement No. 61, The Financial Reporting Entity: Omnibus, anamendment of GASB Statements No. 14 and No. 34. The objective of this statement is to improvefinancial reporting for a governmental financial reporting entity. The requirements ofGASB Statement No. 14, The Financial Reporting Entity, and the related financial reportingrequirements of GASB Statement No. 34, Basic Financial Statements — and Management’sDiscussion and Analysis —for State and Local Governments, were amended to better meet user needsand to address reporting entity issues that have arisen since the issuance of those statements. Theguidance is effective for the City for the year ending December 31, 2013.

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements3;.

December 31, 2012

In March 2012, GASB issued Statement No. 65, items Previously Reported as Assets andLiabilities,which reclassifies certain items that were previously reported as assets and liabilities as deferredoutflows of resources, deferred inflows of resources, or current period outflows and inflows. Therequirements of this statement are effective for the City for the year ending December 31, 2013.

In March 2012, GASB issued Statement No. 66, Technical Corrections. The objective of thisstatement is to improve accounting and financial reporting for a governmental financial reportingentity by resolving conflicting guidance that resulted from the issuance of previous pronouncements.The provisions of this statement are effective for the City for the year ending December 31, 2013.

In June 2012, GASB issued Statement No. 67, Financial Reportingfor Pension Plans. The objectiveof this statement is to improve financial reporting by state and local governmental pension plans.This Statement results from a comprehensive review of the effectiveness of existing standards ofaccounting and financial reporting for pensions with regard to providing decision-useful information,supporting assessments of accountability and interperiod equity, and creating additionaltransparency. The provisions of this statement are effective for the City for the year endingDecember 31, 2014.

In June 2012, GASB issued Statement No. 68, Accounting and Financial Reportingfor Pension. Theprimary objective of this statement is to improve accounting and financial reporting by state andlocal governments for pensions. The provisions of this statement are effective for the City for theyear ending December 31, 2015.

In January 2013, GASB issued Statement No. 69, Government Combinations and Disposals ofGovernment Operations. This statement establishes accounting and financial reporting standardsrelated to government combinations and disposals of government operations. The provisions of thisstatement are effective for the City for the year ending December 31, 2014.

In April 2013, GASB issued Statement No. 70, Accounting and Financial Reporting forNonexchange Financial Guarantees. The objective of this statement is to improve accounting andfinancial reporting by state and local governments that extend and receive nonexchange financialguarantees. The provisions of this statement are effective for the City for the year endingDecember 31, 2014.

The City has not completed its assessment of the impact of the adoption of these statements.

(p) Use ofEstimates

The preparation of the financial statements in conformity with U.S. Generally Accepted AccountingPrinciples (GAAP) requires management to make estimates and assumptions that affect the reportedamounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of thefinancial statements, and the reported amounts of revenues and expenditures/expenses during thereporting period. Actual results could differ from those estimates.

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(2) Interfund Receivables, Payables, and Transfers

Individual interfund receivables and payables at December 31, 2012 are as follows:

Receivable fund Amount Payable fund

Agency Fund $ 1,221,300 Civilian Retirement Fund - Pension TrustFund

Sewer Revenue Fund - Enterprise Fund 20,000,000 General FundNonmajor Enterprise Funds 27,000 Convention Center Hotel Fund -

Enterprise FundDebt Service Fund 10,371,000 General Fund

All remaining balances result from the time lag between the dates that (1) interfund goods and services areprovided or reimbursable expenditures occur, (2) transactions are recorded in the accounting system, and(3) payments between funds are made. All amounts are expected to be paid within one year.

Transfers are related to funding for capital projects, lease payments, debt service, or reallocations ofspecial revenues. The following schedule briefly summarizes the City’s transfer activity:

Transfer inGeneral Nonmajor Sewer Parking

Transfers out fund governmental revenue facilities Total

Major governmental funds:General ifind $ — 966,884 2,446,319 3,413,203

Major enterpdse funds:Sewer revenue 50,000 146,712 — 196,712

Nonmajor governmental 100,000 1,063,139 913,870 — 2,077,007

Total $ 150,000 2,176,735 913,870 2,446,319 5,686,922

(3) Deposits and Investments

The City has generally pooled the cash resources of the various funds, except the pension trust fund, forinvestment purposes. Interest earned on pooled funds is credited to the City’s general fund in accordancewith Nebraska State Statute Section 77-23 15, R.R.S. 1943.

(a) Deposits

Custodial credit risk is the risk that in the event of a bank failure, the City will not be able to recoverits deposits. As of December 31, 2012, all of the City’s deposits were collateralized with securitiesheld by the City’s agent in the City’s name.

(b) City Investments

Investments are stated at fair value. City funds are invested in conformity with the public fundsSecurity Act, Chapter 77, Article 23, specifically 77-2387, of the Nebraska Revised Statutes.

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Allowable investments include U.S. government bonds, U.S. Treasury bills and notes, U.S. agencybonds and notes, certain state and political subdivision bonds, repurchase agreements, warrants ofthe State of Nebraska and Nebraska political subdivisions, and certain instruments of the FHLM,federal farm credit system, FHLB, FNMA, and the Small Business Administration. The governmentmoney market mutual fund consists of only those securities that are allowed by N.R.S. 77-2387.

Custodial Credit Risk — Custodial credit risk is the risk that, in the event of the failure of thecounterparty, the City would not be able to recover the value of its investments or collateralsecurities that are in the possession of an outside party. The City’s policy requires that all funds ondeposit with any financial institution be secured with securities equal or greater than the deposit lessany amount insured by the FDIC. The City’s investment policy also requires that all investmentsecurities be held in the City’s name in the City’s safekeeping account.

Interest Rate Risk — Interest rate risk is the risk that the fair value of the City’s investments willdecrease as a result of an increase in interest rates. The City’s investment policy related to maturity isas follows: U.S. Treasury securities cannot exceed five years; zero-coupon or stripped couponU.S. Treasury notes or bonds cannot exceed two years; certificates of deposit issued by commercialbanks cannot exceed 30 months; and all other investments not mentioned above cannot exceed afive-year maturity from the date of purchase.

The City had the following maturities for pooled investments:

Investment termLess than

Investment type Fair value 1 year 1 — 5 years

U.S. agencies $ 120,792,279 17,894,398 102,897,881U.S. Treasuries 84,157,982 67,289,348 16,868,634

8 204,950,261

The City had the following maturities for investments held by trustees:

Investment termLess than

Investment type Fair value 1 year 1 —5 years

U.S. agencies 8 4,744,808 2,756,927 1,987,881U.S. Treasuries 132,500 — 132,500

$ 4,877,308

Credit Risk — Credit risk is the risk that the City will not recover its investments due to the inabilityof the counterparty to fulfill their obligation. State statute limits investment options to certainspecific investment vehicles. There is no statutory requirement for investments to meet a certainquality rating.

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December3l,2012

The pooled investment’s quality rating is as follows:

QualityInvestment type Fair value rating AAA

U.S. agencies $ 120,792,279 AAAU.S. Treasuries 84,157,982 AAA

$ 204,950,261

The deposits with trustees’ quality rating are as follows:

QualityInvestment type Fair value rating AAA

U.S. agencies $ 4,744,808 AAAU.S. Treasuries 132,500 AAA

$ 4,877,308

Concentration of Credit Risk — Concentration of credit risk is the risk of loss attributed to themagnitude of the City’s investment in a single issuer. State statute does not restrict the concentrationof investment in any issuer. The City’s policy states that no more than 25% of the total portfolio willbe invested in the issuance of any single institution other than securities of the U.S. government andits agencies.

Concentrations of investment by issuer for pooled investments are displayed in the following table:

Investment type Fair value Percentage

U.S. agencies S 120,792,279 60%U.S. Treasuries 84,157,982 40

$ 204,950,261

Concentrations of investment by issuer for deposits held by trustees are displayed in the followingtable:

Investment type Fair value Percentage

U.S. agencies $ 4,744,808 98%U.S. Treasuries 132,500 2

4,877,308

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CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Foreign Currency Risk — Foreign currency risk is the risk that changes in exchange rates willadversely impact the fair value of an investment. The City does not have a policy related to foreigncurrency risk.

Summary — The following is a complete listing of deposits and investments of the City:

Investment type Fair value

Deposits $ 60,767,021Pooled investments 204,950,261Trustee accounts

Cash and cash equivalents 28,222,565Investments 4,877,308

Imprest funds 54,077

$ 298,871,232

The deposits and investments of the City, excluding the pension trust funds, at December 31, 2012,are reflected in the financial statements as follows:

FiduciaryGovernmentwide funds

statement of statement ofInvestment type net position net position Total

Cash and pooled investments $ 45,379,939 8,318,297 53,698,236Investments 189,657,192 1,196,423 190,853,615Restricted deposits with trustee 33,099,873 33,099,873Restricted investments 21,219,508

________________

21,219,508

$ 289,356,512 9,514,720 298,871,232

(c) Pension Trust Funds

The pension trust funds consist of two funds: the Civilian Plan and the Uniformed Plan. Thesepension programs operate in compliance with Omaha Municipal Code Chapter 22 and NebraskaState Statute 30-3209. City pension funds are invested according to a plan developed and reviewedquarterly by each plan’s Investment Committee. The plans define the purposes of the assets, identifythe parties responsible for managing the investment process, establish both broad and specificguidelines for the investment of the fund’s assets, and establish criteria to monitor and evaluate theperformance of the investment managers. The plan authorizes investments in common and preferredstocks, corporate bonds, cash equivalent securities, certificates of deposits of insured institutions,money market funds, bank short-term investment funds, GICs, BICs, and government bonds. Theycan be in mutual funds or privately managed accounts.

48 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Interest Rate Risk — The Pension Board of each plan with the recommendation from the respectiveInvestment Committee approves fund manager agreements. These management agreements outlinespecific investment policies each manager must adhere to. The Retirement Committees do restrictthe general asset allocation to fixed income. The uniformed plan fund’s target range for fixed incomeassets is between 13% and 31% of the portfolio value and the civilian plan fund’s range is between12% and 28%. Updated Investment Guidelines were adopted by each Pension Board inFebruary 2011. Fixed income investments are held in five accounts managed by four managers:$150.7 million in managed accounts and $10.7 million in one bond mutual fund. Maturities of thesecurities in these commingled funds are as follows:

Managed accountsMaturity range (years)

Less thanInvestment type 1 year 1 —5 6 — 10 10+

U.S. Treasuries —% 4.3% 2.5% 2.7%U.S. agencies 0.3 6.0 3.3 1.8Municipal bonds 0.2 — 1.3 1.1Corporate bonds 1.6 29.1 38.6 7.3

Bond mutual fundsPercentage

Maturity of total

0 — 1 years1 — 5 years

6 — 10 years10+ years

27.8%72.2

49 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Credit Risk — Credit risk involves the potential of loss of fair value due to the quality of the fixedincome investments. The Investment Committees of each plan monitor and select fixed fundmanagers based on an investment policy that diversifies the plan’s risks. Each manager employs avarying type of investment style. Fixed income investments are held in five accounts and aremanaged by four managers: $150.7 million in managed accounts and $10.7 million in one bondmutual fund. The quality ratings of the securities in these commingled funds are as follows:

Managed accountsPercentage

Investment type Ratings of total

U.S. Treasuries AAA 9.5%U.S. agencies AAA!AA+ 10.0Municipal bonds AAAIA3 2.8Corporate bonds AAA!A3 21.4U.S. agencies BAA1/BBB 1.4Corporate bonds BAA1/BBB 47.9Corporate bonds N/R 7.0

Bond mutual fundsPercentage

Rating of total

TSY/AGY 41.5%AAAIAaa 39.3AA+/A3 15.0BBB/Ba2 4.0N/R 0.2

Concentration of Credit Risk — Fixed income securities guidelines are governed by each manager’sindividual management contract. This allows a wide variety of management styles, thus diversifyingeach portfolio. Combined target allocation for fixed income securities shall be 12% to 31% of theportfolio. Equity investments shall be 22% to 77% of the portfolio with large cap domestics (6.5% to27%), small cap domestics (6% to 20%), and international equities (9.5% to 30%). Domestic realestate securities shall be 9.5% to 28% of the portfolio. They may be held individually or commingledin mutual funds and investment poois. There are no individual investments greater than 5% with asingle issuer.

50 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

PercentageInvestment type Fair value allocated

Government securities $ 37,312,465 5.3%Municipal issues 3,879,158 0.6Corporate bonds 117,525,803 16.5Domestic equities 227,181,818 32.0International equities 125,170,190 17.6Domestic real estate securities 133,107,674 18.7International real estate 1,503,535 0.2Commodities 33,493,365 4.7Private equity 12,059,269 1.7Cash and cash equivalents 19,508,721 2.7

Total $ 710,741,998 100.0%

Foreign Currency Risk — The City is exposed to foreign currency risk related to internationalequities. Foreign currency risk is the risk that changes in exchange rates will adversely impact thefair value of an investment. The City does not have policy related to foreign currency risk. Allinternational equities are denominated in U.S. dollars.

(4) Net Position/Fund Balances

The governmentwide and proprietary fund financial statements utilize a net position presentation. Netposition are categorized as net investment in capital assets, restricted, and unrestricted.

• Net Investment in Capital Assets — This category groups all capital assets, including infrastructure,into one component of net position. Accumulated depreciation and outstanding balances of debt that areattributable to the acquisition, construction, or improvement of these assets reduce the balance in thiscategory.

• Restricted Net Position — This category presents external restrictions imposed by creditors, grantors,contributors, or laws or regulations of other govemments and restrictions imposed by law throughconstitutional provisions or enabling legislation.

• Debt Service— This fund is restricted for resources for, and the payment of general long-term debtprincipal, interest, and related costs.

• Community Improvement — These funds are restricted to comply with City ordinances requiring athree million dollar bond reserve for the Convention Center Hotel Revenue Bonds and a reserve offund interest earnings from Keno revenues.

• Perpetual care — These funds are used to report resources that are legally restricted to the extent thatearnings, and not principal, may be used for purposes that support the City’s programs for the benefitof the City or its citizenry.

• Unrestricted Net position — This category represents net position of the City not restricted for anyproject or other purpose.

51 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Under GASB Statement No. 54, the governmental funds report up to five categories of fund balance.Ranging from the most restrictive to the least restrictive, they are: nonspendable, restricted, committed,assigned, and unassigned.

• Nonspendable Fund Balances — Nonspendable fund balances are amounts that cannot be spentbecause they are either not in spendable form or legally or contractually required to be maintainedintact.

o Restricted Fund Balances — Restricted fund balances represent amounts constrained by creditors,grantors, contributors or laws, and regulations of other governments, or limitations are imposed bylaw through constitutional provisions or enabling legislation.

o Committed Fund Balances — Committed funds can only be used for specific purposes pursuant toconstraints imposed by the highest level of decision making, which is the City Council. Only theCity Council, through an ordinance or resolution, can change any fund balance commitment.

o Assigned Fund Balances — Assigned fund balances are intended for specific purposes. Allassignments of contracts and purchase orders over $20,000 are approved by the City Council. Aresolution passed by the City Council would explicitly state the specific purpose for the use of funds.Management can assign funds through the purchasing process in conjunction with the FinanceDepartment.

• Unassigned Fund Balance — Unassigned fund balance is the residual classification for the generalfund. In nonmajor governmental funds, if expenditures incurred for specific purposes exceeded theamounts restricted, committed, or assigned to those purposes, it may be necessary to report anegative unassigned fund balance.

52 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Fund balances are classified as nonspendable, restricted, committed, assigned, or unassigned. The Citygenerally follows the same order in spending resources unless special circumstances apply. The followingprovides details of the aggregate amounts displayed on the face of the governmental funds balance sheet:

Nonmajor Totalgovernmental governmental

General Debt Service funds funds

Fund balances:Nonspendable:

Inventory $ 2,320,144 2,320,144Permanent principal 2,775,389 2,775,389

Total nonspendable 2,320,144 2,775,389 5,095,533

Restricted:General

— 6,493,068 6,493,068Public safety

— 1,063,844 1,063,844Transportation 13,655,232 13,655,232Other public services 2,339,669 2,339,669Community development — — 2,196,606 2,196,606Culture and parks 747,561 5,276,223 6,023,784Debt service

— 18,689,053 3,799,690 22,488,743

Totalrestricted 747,561 18,689,053 34,824,332 54,260,946

Committed:General 6,257,059 6,257,059Transportation

— 3,303,762 3,303,762Other public services 5,227,274 5,227,274Community development

— 422,867 422,867Culture and parks

— 3,493,074 3,493,074Debt service — —

Total committed 18,704,036 18,704,036

Assigned:General 1,153,124 5,655,987 6,809,111Public safety 5,587,995 — 5,587,995Transportation 114,107 114,107Community development 190,714 — 190,714Culture and parks 187,095 — 1,035,627 1,222,722Other public services — —

Total assigned 7,233,035 — 6,691,614 13,924,649

Unassigned 37,608,141 — (13,987,312) 23,620,829

Total unassigned 37,608,141 — (13,987,312) 23,620,829

Total all funds $ 47,908,881 18,689,053 49,008,059 115,605,993

53 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(5) Reconciliation of government-wide and fund financial statements

(a) Explanation of Certain Differences between the Governmental Funds Balance Sheet and theGovernment-Wide Statement of Net Position

The governmental funds balance sheet includes reconciliation between find balance — totalgovernmental funds and net position of governmental activities as reported in the government-widestatement of net position. One element of that reconciliation explains, “Long-term liabilities,including bonds payable and pension obligations, are not due and payable in the current period and,therefore, are not reported in the funds.” The details of the $1,227,109,321 difference are as follows:

Bonds payable $ 618,481,829Less deferred amount for loss on

refunding (34,692,920)Less issuance discounts (398,176)Plus issuance premiums 39,441,231Capital leases payable 120,663,183Notes payable 2,947,275Contracts payable 10,431,000Grant payable 15,763,750Accrued interest payable 6,990,032Workers’ compensation and

healthcare claims 38,743,996Net pension obligation 201,734,657Net OPEB obligation 137,193,594Claims and judgments payable 1,950,000Compensated absences 67,859,870

Net difference $ 1,227,109,321

(b) Explanation of Certain Differences between the Governmental Funds Statement of Revenues,Expenditures, and Changes in Fund Balances and the Government-Wide Statement ofActivities

The governmental funds statement of revenues, expenditures, and changes in fund balances includesreconciliation between net change in fund balances — total governmental funds and change in netposition of governmental activities as reported in the government-wide statement of activities. Oneelement of that reconciliation explains, “Governmental funds report capital outlays as expenditures.However, in the statement of activities, the cost of those assets, which exceeds the capitalizationthreshold, is allocated over their estimated useful lives and reported as depreciation expense.” Thedetails of this ($5,081,487) differences are as follows:

Capital outlay $ 32,819,516Depreciation expense (37,901,003)

Net difference $ (5,081,487)

54 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Another element of that reconciliation states, “The issuance of long-term debt (e.g., bonds, leases,etc.) provides current financial resources to governmental funds, where as the repayment of theprincipal of long-term debt consumes the current financial resources of governmental funds. Neithertransaction, however, has any effect on net position. Also, governmental funds report the effect ofissuance costs, premiums, discounts, and similar items when debt is first issued, whereas theseamounts are advanced and amortized in the statement of activities.” The details of this $1,651,233difference are as follows:

Debt issued or incurred:Issuance of long-term debt $ (112,957,928)Annexed debt (12,285,378)Deferred charge for issuance costs (2,440,965)

Amortization of deferred items (398,360)Principal repayments 47,062,140Current refunding 39,261,724Defeased debt 43,410,000

Net difference $ 1,651,233

Another element of that reconciliation states, “Some expenses reported in the statement of activitiesdo not require the use of current financial resources and, therefore, are not reported as expendituresin governmental funds.” The details of this ($62,778,038) difference are as follows:

Grants payable $ 2,300,000Workers’ compensation and

health claims (4,953,358)Claims and judgments payable 1,445,000Net pension obligation (27,681,550)Postretirement benefits obligation (27,647,165)Accrued interest 221,498Compensated absences (6,462,463)

Net difference $ (62,778,038)

(6) Special Assessment Note Payable

The City did not obtain a note for 2012, as there were sufficient funds available to fund the currentrequirements in the special assessment fund for the purpose of meeting obligations to contractors for workin place that will ultimately be assessed to the benefited property owners.

55 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(7) Bonds Payable and Other Long-Term Obligations

The following is a summary of long-term liability transactions for the year ended December 31, 2012:

Balances at lssuances Retirements Balances at Amount dueJanuary 1, or other or other December 31, within one

2012 additions reductions 2012 year

Governmental activities:Bonds payable:

General obligation bonds S 516,090,000 59,210,000 65,560,000 509,740,000 38,835,000Annexed general obligation

bonds 2,660,000 12,285,378 7,890,614 7,054,764 2,004,764Special tax revenue bonds 43,120,000 23,700,000 26,240,000 40,580,000 3,130,000Special obligation bonds 60,495,488 23,152,065 24,215,488 59,432,065 1,809,870Revenue bonds 1,855,000 180,000 1,675,000 185,000Deferred amounts:

Unamortized premiums 34,843,923 8,380,766 3,783,458 39,441,231 —

Unamortized discounts (413,390) (3,922) (19,136) (398,176) —

Loss on refunding (32,362,159) (4,963,632) (2,632,871) (34,692,920) —

Total bonds payable 626,288,862 121,760,655 125,217,553 622,831,964 45,964,634

Special assessment note 536,000 536,000

Lease-purchase contractspayable 119,240,045 5,265,000 3,841,862 120,663,183 4,870,928

Notes payable 2,190,812 1,094,863 338,400 2,947,275 351,622Contracts payable 11,362,500 — 931,500 10,431,000 955,000Grants payable 18,063,750 — 2,300,000 15,763,750 2,250,000Compensated absences 61,397,407 6,462,463 — 67,859,870 3,392,993Workers’ compensation and

healthcare claims 33,790,638 4,953,358 — 38,743,996 13,703,654Claims and judgments payable 3,395,000 — 1,445,000 1,950,000 1,950,000Net pension obligation 174,053,107 27,681,550 — 201,734,657 —

Postretirement benefit obligation 109,546,429 27,647,165 — 137,193,594 —

Total governmentallong-term

liabilities 1,159,328,550 195,401,054 134,610,315 1,220,119,289 73,438,831

Business—type activities:Convention Center Hotel:

Revenue bonds 145,965,000 640,000 145,325,000 1,160,000Deferred amounts:

Unamortized premium 2,649,573 118,417 2,531,156Unamortized discount (241,956) (8,355) (233,601)Loss on refunding (3,735,450) (166,948) (3,568,502)

144,637,167 583,114 144,054,053 1,160,000

56 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Balances at Issuances Retirements Balances at Amount dueJanuary 1, or other or other December 31, within one

2012 additions reductions 2012 year

Parking Facilities Fund:Lease-purchase contracts

payable S 39,055,000 — 2,635,000 36,420,000 2,730,000Deferred amounts:

Unamortized premium 38,950 — 7,028 31,922 —

Unamortized discount (6,121) — (954) (5,167) —

Loss on refunding (381,481) — (64,888) (316,593) —

Accrued compensated absences 346 346 17Workers’ compensation and

healthcare claims 16,550 88 16,462 5,822Net pension obligation 42,770 3,970 46,740 —

Postretirement benefitobligation 38,429 2,937 — 41,366 —

38,804,097 7,253 2,576,274 36,235,076 2,735,839

Sewer Revenue Fund:Revenue bonds 212.040,000 97,650,000 6.935,000 302,755,000 9,195,000Plus unamortized

premium 2,426,386 9,559,176 408,483 11,577,079 —

Loss on refunding — (178,651) (8,507) (170,144) —

Notes payable 13,071,421 874.700 490,335 13,455,786 592,735Special obligation bonds 17,639,512 17,252,935 17,639,512 17.252,935 935,130Plus unamortized

premium 146,288 237,290 154,198 229,380 —

Compensated absences 1,683,474 — 64,220 1,619,254 80,963Workers’ compensation and

healthcare claims 1,583,451 243,864 — 1,827,315 646,317Net pension obligation 5,843,687 1,288,035 — 7,131,722 —

Postretirement benefitobligation 5,250,569 1,060,960 6,311,529

259,684,788 127,988,309 25,683,241 361,989,856 11,450,145

Nonmajor business-type activities:Lease-purchase contracts

payable 370,000 25,000 345,000 25,000Deferred amounts:

Unamortized premium 1,857 — 156 1,701 —

Compensated absences 396,473 7,246 56,646 347,073 17,353Workers’ compensation and

healthcare claims 523,261 47,292 6,720 563,833 199,427Netpension obligation 1,415.271 149,130 13,552 1,550,849 —

Postretirement benefitobligation 1,271.626 115,867 15,000 1,372,493

3,978,488 319,535 117,074 4,180,949 241,780

Total business-typeactivities 447,104,540 128,315,097 28,959,703 546,459,934 15,587,764

Total all funds S 1,606,433,090 323,716,151 163,570,018 1,766,579,223 89,026,595

57 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(a) Governmental Activities

Bonds payable at December 31, 2012 comprises the following individual issues:

General Obligation Bonds

Effectiveinterest rate First

Original payable Series date December31,Amount issued Issue semiannually due callable 2012

$ 16,000,000 03/01/03 Various purpose 2.75% — 5.00% 2003—2022 2013 $ 840,00030,175,000 03/01/03 GO. — defeasance bonds 1.50% — 4.30% 2003 —2021 2013 12,820,000

205,875,000 04/01/04 GO. — defeasance bonds 5.25% — 5.25% 2004—2027 2014 197,445,00031,660,000 04/01/04 Various purpose — refund

series 2.00% — 4.50% 2004—2024 2014 8,720,00042,800,000 11/15/05 Various purpose— refund

series 4.00%—4.75% 2006—2025 2015 6,420,00026,625,000 10/15/06 Various purpose — refund

series 4.00% — 4.25% 2007—2026 2016 13,595,00046,785,000 10/15/07 Various purpose— refund

series 4.00%—4.75% 2008 —2027 2017 34,490,00075,540,000 7/24/08 Various purpose.- refund

series 3.75% — 5.00% 2009—2025 2018 61,995,00017,880,000 10/30/08 G.O. — defeasance bonds 5.00% — 5.75% 2009—2028 2018 14,305,00037,050,000 04/16/09 GO. — defeasance bonds 3.625% — 5.00% 2010—2025 2019 18,985,000

7,440,000 10/15/09 Various purpose 2.00% — 3.00% 2010—2017 none 4,650,00011,160,000 10/15/09 Various purpose 4.229% — 5.721% 2018— 2029 2019 11,160,0008,510,000 10/15/09 G.O. — defeasance bonds 2.00% — 5.00% 2010—2026 2019 6,180,000

35,950,000 11/10/10 GO. — defeasance bonds 2.00% — 4.50% 2011 —2030 2020 30,200,0008,500,000 11/18/10 Various purpose 0.70% — 5.00% 2011 —2030 2020 7,650,000

13,310,000 10/13/11 Various purpose 1.25% —4.125% 2012— 2031 2020 12,645,0009,525,000 10/13/11 G.O. — defeasance bonds 2.00% — 3.30% 2021 —2025 2020 8,430,000

27,170,000 10/12/12 Various purpose - refundseries 3.00% —4.125% 2013 -2032 2022 27,170,000

32,040,000 10/12/12 GO. — defeasance bonds 3.00% — 4.00% 2013 - 2028 2022 32,040,000

Total general obligation bonds 509,740,000

Annexed General Obligation Bonds

1,245,000 05/01/08 S.l.D. #353 3.10% — 4.20% 2009—2018 2013 50,0001,420,000 01/01/11 S.l.D. #354 1.15% — 4.00% 2012—2022 2016 1,320,0001,200,000 03/15/11 S.l.D. #244 1.50% — 4.10% 2013— 2021 2016 1,200,0001,125,000 10/15/09 S.l.D.#300 2.40%— 4.10% 2012— 2019 2013 425,000

350,000 05/01/11 S.l.D. #300 1.55% — 3.85% 2013— 2021 2016 350,0001,290,000 01/15/03 S.l.D.#330 1.80%— 4.80% 2003— 2017 2007 405,0002,100,000 07/01/09 S.l.D.#330 2.20%— 2.25% 2010— 2017 2013 255,0001,740,000 01/15/11 S.l.D.#370 1.30%— 3.40% 2012— 2019 2016 1,540,000

885,000 10/11/11 S.l.D.#416 1.10%— 3.50% 2012— 2021 2016 815,000500,000 10/15/08 S.l.D. #440 3.15%— 5.30% 2010— 2028 2013 10,000

Various S.l.D. #553 Warrants 7.00% 684,764

Total annexed general obligation bonds 7,054,764

Total general obligation and annexed area bonds $ 516,794,764

58 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Governmental Activities Special Tax Revenue Bonds

Effectiveinterest rate First

Original payable Series date December 31,Amount issued Issue semiannually due callable 2012

$ 20,325,000 09/01/04 Performing Arts complexRedevelopment Bonds 2.50% —5.00% 2005 —2024 2014 $ 2,985,000

1,095,000 12/20/07 1-lorneland RedevelopmentProjectSeries2007A 4.00%—4.25% 2007—2016 None 735,000

4,075,000 12/20/07 Various ProjectsRedevelopment Series 2007 3.60% — 5.13% 2007—2027 2017 4,060,000

2,000,000 03/25/08 Special Tax RevenueRefunding Series 2008 3.03% — 4.32% 2009—2013 None 430,000

4,865,000 11/13/08 Special Tax RevenueRedevelopment Series 2008 4.00% — 5.25% 2009—2028 2018 4,185,000

5,170,000 10/29/09 Special Tax RevenueRedevelopment TaxableSeries 2009A (BAB) 1.159% — 6.022% 2010— 2029 2019 4,970,000

3,225,000 03/01/12 Special Tax RevenueRefunding Series 2012 2.00% — 4.00% 2012—2018 None 2,740,000

8,690,000 03/01/12 Special Tax RevenueRefunding Series 2012A 2.00% — 5.00% 2013—2032 None 8,690,000

11,785,000 10/25/12 Special Tax RevenueRefunding Series 2012 2.00% — 4.00% 2015—2024 None 11,785,000

8 40,580,000

Special Obligation Bonds — Governmental Activities

Effectiveinterest rate First

Original payable Series date December 31,Amount issued Issue semiannually due callable 2012

$ 38,535,000 03/25/08 Riverfront RedevelopmentRefund Series 2008 4.00% — 6.40% 2009—2026 None $ 36,280,000

23,152,065 03/01/13 Riverfront RedevelopmentRefund Series 2012 2.00% — 5.00% 2013 —2032 2022 23,152,065

$ 59,432,065

Governmental Activities Revenue Bonds

Effectiveinterest rate First

Original payable Series date December 31,Amount issued Issue semiannually due callable 2012

$ 760,000 03/01/04 HighwayAllocation 1,20%—3.65% 2004—2014 2009 $ 310,0001,420,000 09/30/06 Highway Allocation 3.85% — 4.45% 2007—2026 2011 1,365,000

$ 1,675,000

59 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(b) Business-Type Activities

Bonds payable at December 31, 2012 comprises the following individual issues:

Business-Type Activities Revenue Bonds

Effectiveinterest rate

payableIssue semiannually

_____________ _____________ _____________

Elkhom Sewer Revenue 1.25% — 3.70%Sanitary Sewer System

Revenue Bonds Series 2006 4.00% — 4.50%Convention Center Hotel

Revenue, Series 2007A 4.00% — 5.00%Convention Center Hotel

Revenue, Series 201 0B (BAB) 3.905% —7.125%Sanitary Sewer System

Revenue Series 2009B (BAB) 1.04% —6.153%Sanitary Sewer System Refunding

Revenue, Series 2010A 2.00% —3.625%Sanitary Sewer System

Revenue, Series 20 lOB (RZDB)3.993% — 5.076%Sanitary Sewer System

Revenue Series 2011 2.00% — 5.00%Sanitary Sewer System

Revenue Series 2012 2.00% - 5.00%

Amount

S 2,010,00053,170,000

109,750,000

37.000,000

29,975,000

33,800,000

34,079,570

69,560,000

97,650,000

Originalissued

05/20/0311/15/06

05/15/07

12/15/10

12/10/09

11/18/10

11/18/10

12/01/Il

12/31/12

Seriesdue

2003 —2013

2006—2036

2010—2035

2016—2040

2010—2039

2011—2026

2011 —2040

2012—2041

2013-2042

Firstdate December 31,

callable 2012

2008 $ 220,000

2016 48,105,000

2017 108,325,000

2010 37,000,000

2019 27,970,000

2010 27,975,000

2010 32,455,000

2021 68,380,000

2022 97,650.000

$ 448,080,000

Firstdate December 31,

callable 2012

Special Obligation Bonds - Business-Type Activities (Sewer Revenue Fund)

Effectiveinterest rate

payable SeriesIssue semiannually due

OriginalAmount issued

$ 17,252,935 03/01/12 Riverfront RedevelopmentProject Series 2012 2.00% - 5.00% 2013 -2032 2022 $ 17,252,935

17,252,935

60 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

As of December 31, 2012, the bonds payable debt service requirements of the City for principal andinterest in future years are as follows:

Governmental activitiesPrincipal Interest Total

Year ending December 31:2013 $ 45,964,634 27,579,433 73,544,0672014 44,337,790 25,657,156 69,994,9462015 42,424,020 23,922,927 66,346,9472016 43,157,615 22,167,172 65,324,7872017 41,757,670 20,328,708 62,086,3782018 —2022 195,090,000 73,769,943 268,859,9432023 —2027 168,300,085 28,803,324 197,103,4092028—2032 37,450,015 3,541,566 40,991,581

$ 618,481,829 225,770,229 844,252,058

Business-type activitiesPrincipal Interest Total

Year ending December 31:2013 $ 11,290,130 20,723,955 32,014,0852014 9,992,210 20,714,130 30,706,3402015 9,730,980 20,429,016 30,159,9962016 10,857,385 20,089,957 30,947,3422017 11,327,330 19,703,616 31,030,9462018 —2022 63,575,000 91,360,364 154,935,3642023—2027 82,294,915 75,335,520 157,630,4352028—2032 103,744,985 53,356,322 157,101,3072033 —2037 106,415,000 26,918,906 133,333,9062038 —2042 56,105,000 6,790,558 62,895,558

$ 465,332,935 355,422,344 820,755,279

General obligation bonds have been approved by the voters and issued by the City for variousmunicipal improvements. These bonds represent indebtedness supported by the full faith and creditof the City.

61 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(c) Notes Payable

Notes payable consist of a loan contract between the City and the U.S. Army Corps of Engineers andthree loan contracts between the City and the Nebraska Department of Environmental Quality(NDEQ) with interest rates ranging from 0% to 3%. Maturities of the notes payable are as follows:

Governmental activitiesPrincipal Interest Total

Year ending December 31:2013 $ 351,622 113,597 465,2192014 367,222 97,997 465,2192015 383,537 81,682 465,2192016 400,600 64,619 465,2192017 292,607 48,077 340,6842018—2022 741,081 123,516 864,5972023—2027 410,606 21,693 432,299

8 2,947,275 551,181 3,498,456

Business-type activitiesPrincipal Interest Total

Year ending December 31:2013 $ 592,735 233,998 826,7332014 603,105 223,628 826,7332015 613,671 213,062 826,7332016 624,430 202,303 826,7332017 635,385 191,348 826,7332018—2022 2,655,142 651,790 3,306,9322023—2027 3,590,532 543,133 4,133,6652028—2032 4,140,786 216,855 4,357,641

$ 13,455,786 2,476,117 15,931,903

(d) Grants Payable

The City has entered into various agreements with not-for-profit organizations to provide grant fundsas follows:

2013 $ 2,250,0002014 1,635,2502015 1,725,2002016 1,820,1002017 1,920,2002018—2020 6,413,000

$ 15,763,750

62 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December3l,2012

(e) Tax Increment Financing Notes and Bonds

At December 31, 2012, $305,156,947 of tax increment financing notes and bonds were outstanding.Tax increment financing allows cities to create special districts and to make public/privateimprovements within those districts that will generate public/private-sector development. For aperiod of 15 years, the tax base is frozen at the predevelopment level, and taxes generated from theincremental increases in assessed value are remitted as payment on the notes and bonds. The loanagreements between the City and developer expressly limit the City’s commitment for debtrepayment to the incremental tax collected during the 15-year period. At the end of the 15-yearperiod, the tax jurisdiction collects on the increased property values. The related tax incrementdistricts are not component units of the City; therefore, the City is not liable for the outstanding debt.The City’s responsibility for this liability is limited only to remittance of paid taxes.

(j9 Debt Margin/Covenants

According to the City Charter, the total amount of general obligation indebtedness (includingannexed area bonds) outstanding at any time, which shall include bonds issued, but shall not includebonds authorized until they are issued, shall not exceed 3.5% of the actual value of taxable real andpersonal property in the City. Debt margin as of December 31, 2012 is calculated as follows:

Debt limit $ 976,978,815

General obligation debt 516,794,764Debt service fund balance 18,689,053

498,105,711

Debt margin S 478,873,104

Revenue bonds and certain other long-term obligations are the obligation of specific enterprise fundsand are payable solely from the revenues of the respective funds. Provisions in the revenue bondordinances contain limitations and restrictions on annual debt service requirements, maintenance ofand flow of moneys through various restricted accounts, and minimum amounts to be maintained invarious accounts. It is management’s opinion the City is in compliance with all such significantprovisions.

(g) In Substance Deftasance

On October 25, 2012, the City issued $11,785,000 of special tax revenue development bonds toprovide resources to purchase investment securities that were placed in an irrevocable trust for thepurpose of generating resources to all future debt service payments of $11,685,000 of special taxrevenue bonds. As a result, the funded bonds are considered to be defeased and the liability has beenremoved from the govemmental activities column of the statement of net position. The reacquisitionprice exceeded the net carrying amount of the old debt by $770,644. This amount is being nettedagainst the new debt and amortized over the shorter life of the refunded debt or original debt. Thisrefunding was undertaken to reduce total debt service payments over the next 12 years by $1,248,180and resulted in an economic gain of$1,207,572.

63 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December3l,2012

On October 12, 2012, the City issued $32,040,000 of general obligation refunding bonds to provideresources to purchase investment securities that were placed in an irrevocable trust for the purpose ofgenerating resources for all future debt service payments of $31,725,000 of general obligation bonds.As a result, the refunded bonds are considered to be defeased and the liability has been removedfrom the governmental activities column of the statement of net position. The reacquisition priceexceeded the net carrying amount of the old debt by $3,082,814. This amount is being netted againstthe new debt and amortized over the shorter life of the refunded debt or original debt. This refundingwas undertaken to reduce total debt service payments over the next 16 years by $2,666,154 andresulted in an economic gain of $2,533,692.

In prior years, the City defeased certain general obligation and other bonds by placing the proceedsof new bonds in an irrevocable trust to provide for all future debt service payments on the old bonds.Accordingly, the trust account assets and the liability for the defeased bonds are not included in theCity’s financial statements. The amount of in substance defeased debt outstanding at December 31,2012 is shown as follows:

64 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

General Obligation Bonds

2000 Convention Center Series A $ 92,175,0002003 Various Purpose 7,560,0002004 Various Purpose & Refunding 2004B 7,430,0002005 Various Purpose & Refunding 2005A 21,400,000

128,565,000

General Obligation Bonds

S.I.D. #250 700,000S.LD. #288 119,567S.I.D. #322 1,315,000S.I.D. #388 850,000S.I.D. #353 A 925,000S.I.D. #353 A 460,000S.I.D. #330 H 1,210,000S.I.D. #300 R 300,000

5,879,567

Total general obligation andannexed area bonds 134,444,567

Special Tax Revenue Bonds

2001 Performing Arts Redevelopment 11,685,000

Lease Purchase Bonds

2006 Rosenblatt Stadium 1,320,0002007 Rosenblatt Stadium 400,000

Total lease purchase bonds 1 ,720,000

Total $ 147,849,567

(8) Leases

The City is leasing libraries and other facilities under noncancelable lease-purchase agreements expiring atvarious times through 2036, at which time title will be conveyed to the City. The net book value of leasedassets is approximately $182.9 million. The rental payments are designed to equal the debt servicerequirements of certain nonprofit organizations that financed the construction of the facilities. The City hasan option to purchase the facilities at any time by paying an amount equal to the total of all remainingunpaid lease obligations to the lessor at that time.

65 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

The following schedule reflects future minimum lease payments under the lease-purchase agreementstogether with the present value of the net minimum lease payments as of December 31, 2012:

Governmental Business-typeactivities activities

Fiscal year ending:2013 $ 11,299,687 4,548,2172014 12,259,554 4,381,0352015 12,230,234 4,397,1782016 9,941,709 3,701,2192017 9,004,215 3,694,8522018—2022 44,439,438 13,534,7542023 — 2027 40,602,573 9,933,8672028—2032 36,069,588 9,116,3602033 —2036 29,335,408 1,829,585

Total minimum lease payments 205,182,406 55,137,067

Less amount representing interest 74,088,223 18,372,067

Total principal obligation under capital leaseswith rates of interest from 1.10% to 6.51% $ 131,094,183 36,765,000

The City leases space in the Omaha Douglas Civic Center and the adjoining Hall of Justice under a leasethat expires only upon payment of all outstanding bonds of the Commission. The annual rental paymentsare determined based upon actual space occupied by the City for operation and maintenance. Actual rentalpayments for 2012 were approximately $1,600,000.

66 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(9) Receivables

Receivables at December 31, 2012 of the City’s major funds and nonmajor funds in the aggregate,including the applicable allowances for uncollectible accounts, are as follows:

Total

Total Parking business

Dabs gos’erooceolal facilities Soaver l5pr

General senior Nonmajor activities fund fund Nonmajor activities Total

Receivables:

Properlylasas S 79,669.535 53.605.859 6.090.852 136,795.226 .— 30,795,226

Tolopisooc occopasios las 2,377,1)22 — — 2,377,022 — — 2,377,022

I ole) cole) 0000pal:oo vs 426.964 — 426.964 — — 426,964

Vol tIe rectal occopaloo las 652,264 — — 652,264 — — 652,264

Roslaerael Tos 3.025,709 — 3.025.709 — —. — — 3,025,789

CoblcTV 000 (101 600011:00 fee 1.367,164 — — 1,367,164 — — — 1,367,103

MU)) is boo alIas 069,511 — — 665,5)) — — 669.511

OPPD is l:eo oflas 43,672 29.736 3,363 76.99) — — — 76,991

Moles vohbU las 745.432 — 745,432 — -‘- — — 745,432

Special aslesoesool -— 2.1164.175 2,464,456 4,526,63) — — — — 4.025,63)

Decor’s Trosl — — I 1,111)0,001) 11,000,000 — — — 11,000,1164

MECA — - 2.066.363 2.008.363 — — — — 2,880,363

Charges for seroices 000 016cr 4.078,634 — 5.661,1117 9.739,65) 171,726 1,420,249 170,266 1,762.241 11.501,092

S 92.676.167 55,699,751) 26,117,071 126,493,000 171,726 1.420.249 170,266 1.762,241 178,255.249

Governmental funds report advanced revenues in connection with receivables for revenues not consideredavailable to liquidate liabilities of the current period. At December 31, 2012, the various components ofadvanced revenue and unearned revenue are as follows:

Advanced Unearned

Property tax receivable (general fund) $ 79,089,535 25,360Property tax receivable (debt service fund) 53,605,839 17,189Special assessments (debt service fund) 2,064,175 —

Property tax receivable (nonmajor governmental funds) 6,099,852 1,957Special assessments (nonmajor governmental funds) 3,585,914Grants (general fund) 1,869,501 —

Grants (nonmajor governmental funds) 19,328,957 4,611,917MECA (nonmajor governmental funds) 2,888,363 —

Charges for services and other (sewer revenue fund) 270,460Charges for services and other (nonmajor enterprise funds)

_______________

46,637

$ 168,532,136 4,973,520

(10) Employees’ Retirement Plans

Substantially all City employees are covered by one of two single-employer contributory defined benefitretirement plans. The City of Omaha Employees’ Retirement System (the Civilian Plan) and the City ofOmaha Police and Firefighters Retirement System (the Uniformed Plan), as described as follows, areaccounted for by the City as pension trust funds.

67 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(a) Civilian Plan

Plan Description — The Civilian Plan is a single-employer contributory defined benefit pension plan.The Civilian Plan provides retirement benefits to plan members and beneficiaries. All eligible Cityemployees, except the following, are covered by the plan: police; firefighters; persons paid on acontractual or fee basis; seasonal, temporary, and part-time employees; and elected officials who donot make written application. Cost-of-living adjustments are provided to members and beneficiariesat the discretion of the City in accordance with plan provisions. A cost-of-living adjustment currentlyis provided for members who retired prior to January 28, 1998 after a five-year waiting period. ThePension Board of the City administers the Civilian Plan. The Pension Board is responsible forestablishing or amending plan provisions. The Civilian Plan does not issue separate financialstatements.

Funding Policy — Effective January 1, 2012, Civilian Plan members are required to contribute, bypayroll deduction, 10.08% of their annual covered salary and the City is required to contribute at arate of 11.78% of annual covered salary. Administrative costs for management of the investmentfunds are financed through investment earnings. Other administrative costs of the Civilian Plan arepaid by the City’s general fund. Contributions to the Civilian Plan totaled $6,201,923 for theemployees and $7,216,050 for the employer for the year ended December 31, 2012.

Participant Data

Membership of the Civilian Plan consists of the following at December 31, 2012:

Number of:Active members 1,152Service retirements 1,002Surviving spouses and children 272Disabled 84Deferred vested 75

Total participants 2,585

The Civilian Plan is not subject to either the minimum funding standards of the EmployeeRetirement Income Security Act of 1974 or the maximum funding standards of the EmployeeRetirement Income Security Act of 1974 or the maximum funding limitations. Funding standards areactuarially determined using the entry age normal cost method.

68 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

The information presented in the notes to financial statements and required supplementaryinformation was determined as part of the actuarial valuation at the date indicated. Additionalinformation as of the latest actuarial valuation follows:

Valuation date January 1, 2012Actuarial cost method Entry age normal methodAmortization method Level percent cost of payRemaining amortization period 20 yearsAsset valuation method Expected + 25%

75% of expected value, plus 25% of market valueActuarial assumptions:

Investment rate of return 8% per yearProjected salary increases Varying 4% to 10% per yearCost-of-living adjustments Lesser of 3% or $50 per monthAmortization period Closed

Annual Pension Cost and Net Pension Obligation — The City’s annual pension cost and net pensionobligation to the Civilian Plan for the fiscal year ended December 31, 2012 are as follows:

Annual required contribution $ 15,658,045Interest on net pension obligation 3,322,571Adjustment to annual required contribution (3,016,754)

Annual pension cost 15,963,862

Contributions made (7,216,050)

Increase in net pension obligation 8,747,812

Net pension obligation, beginning of year (41,532,143)

Net pension obligation, end of year $ (50,279,955)

The annual pension costs, the percentage of annual pension cost contributed, and the net pensionobligation for 2012, 2011, and 2010 are as follows:

Schedule of employer contributionsAnnualrequired Percentage Net

contribution of ARC pension(ARC) contributed obligation

Fiscal year ended:2012 $ 15,658,045 46% $ (50,279,955)2011 14,564,847 45 (41,532,143)2010 14,149,386 41 (33,263,609)

69 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Basis ofAccounting — The Civilian Plan’s financial statements are prepared using the accrual basis ofaccounting and are presented as a pension trust fund in the accompanying basic financial statementsof the City. Plan member and employer contributions are recognized in the period in which thecontributions are due. Benefits are provided based on a percentage of the member’s final averagecompensation and are recognized when due and payable.

Method Used to Value Investments — Civilian Plan assets are carried at fair value. Investments insecurities traded on a national securities exchange are valued at the latest quoted market prices.Unlisted investments are valued at net asset value.

Funding Status and Funding Progress — The funding status and funding progress is as follows(dollars in millions):

Actuarial UAAL as aActuarial accrued Unfunded percentagevalue of liability (AAL) AAL Funded Covered of covered

Actuarial assets entry age (UAAL) ratio payroll payrollvaluation date (a) (b) (b-a) (a/b) (c) ((b-a)/c)

2012 $ 236.7 420.8 184.1 56.3% $ 62.8 293.2%

The schedules of funding progress, presented as required supplementary information (RSI) following the notes to the financial statements,present multiyesr trend information about whether the actuarial values of plan assets are increasing or decreasing over time relativeto the AALs for benefits.

Summary financial information for the Civilian Plan is as follows:

Assets

Cash and cash equivalents $ 984Due from other funds 1,089Receivables:

Accounts receivable 312,293Accrued interest 318,835

Investments 224,240,752

Total assets $ 224,873,953Liabilities

Accounts payable and other current liabilities $ 1,640,865

Total liabilities 1,640,865Net Position

Net position:Held in trust for pension benefits 223,233,088

Total liabilities and net position $ 224,873,953

70 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Additions:Contributions:

Employer $ 7,216,050Employee 6,201,923

Total contributions 13,417,973

Investment income (loss):Dividends and interest 6,075,554Net appreciation in fair value of investments 18,454,403Investment expenses (1,364,199)

Net investment income 23,165,758

Total additions 36,583,73 1

Deductions:Benefit payments 28,785,427

Change in net position 7,798,304

Net position held in trust for pension benefits, beginning of year 215,434,784

Net position held in trust for pension benefits, end of year $ 223,233,088

(b) Uniformed Plan

Plan Description — The Uniformed Plan is a single-employer contributory defined benefit pensionplan. The Uniformed Plan covers all eligible probationary and regular sworn personnel of the Policeand Fire Departments of the City. The Uniformed Plan provides retirement, disability, and deathbenefits to plan members and beneficiaries. Cost-of-living adjustments are provided to members andbeneficiaries at the discretion of the City in accordance with plan provisions. The City Council hasthe authority to negotiate, set, and amend contribution rates for the employer and employees. ThePension Board of the City administers the Uniformed Plan. The Pension Board is responsible forestablishing or amending plan provisions. The Uniformed Plan does not issue separate financialstatements.

The valuation date of January 1, 2012 does not include the renegotiated fire union contract. The fireunion signed a new contract with the City in December 2012, which includes a commitment by theCity and the fire union to increase their contributions to the uniform plan to address the growingunfunded liability of the Plan. Management has yet to quantify the impact of the new contract, butexpects the changes to impact the updated valuation to be prepared on January 1, 2013.

71 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Funding Policy — Uniformed Plan members are required to contribute, by payroll deduction, apercentage of their annual covered salary and the City is also required to contribute as follows:

Bargaining group Employee rate City rate

Fire Sworn 15.40 21.02Fire Management 15.45 21.07Police Sworn 16.35 33.67Police Management 16.35 33.17

In addition, the City will make contributions of $1,327,600 annually through 2028. Administrativecosts for management of the investment funds are financed through investment earnings. Otheradministrative costs of the Uniformed Plan are paid by the City’s general fund. Contributions to theUniformed Plan totaled $19,641,660 for the employees and $35,302,037 for the employer for theyear ended December 31, 2012.

Participant Data

Membership of the Uniformed Plan consists of the following at December 31, 2012:

Number of:Active members 1,411Service retirements 947Surviving spouses and children 282Disabled 237Deferred vested 11

Total participants 2,888

The Uniformed Plan is not subject to either the minimum funding standards of the EmployeeRetirement Income Security Act of 1974 or the maximum funding standards of the EmployeeRetirement Income Security Act of 1974 or the maximum funding limitations. Funding standards areactuarially determined using the entry age normal cost method.

72 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

The information presented in the notes to the basic financial statements and required supplementaryinformation was determined as part of the actuarial valuation at the date indicated. Additionalinformation as of the latest actuarial valuation follows:

Valuation date January 1, 2012Actuarial cost method Entry age normal methodAmortization method Level percent of payRemaining amortization period 21 yearsAsset valuation method Expected Value + 33%

One-third of market value, plustwo-thirds of expected asset value

Actuarial assumptions:Investment rate of return 8% per yearProjected annual salary increases varying 4% through 6.5%Final year wage adjustment 10.0%Cost-of-living adjustments Lesser of 3% or $50 per month ($65 for fire

retirements after June 30, 2007)Amortization period Closed

Annual Pension Cost and Net Pension Obligation — The City’s annual pension cost and net pensionobligation to the Uniformed Plan for the year ended December 31, 2012 are as follows:

Annual required contribution $ 54,310,693Interest on net pension obligation 11,185,815Adjustment to annual required contribution (9,833,151)

Annual pension cost 55,663,357

Contributions made (35,302,037)

Increase in net pension obligation 20,361,320

Net pension obligation, beginning of year (139,822,693)

Net pension obligation, end of year $ (160,184,013)

73 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December3l,2012

The annual pension costs, the percentage of annual pension cost contributed, and the net pensionobligation for 2012, 2011, and 2010 are as follows:

Schedule of employer contributionsAnnualrequired Percentage Net

contribution of ARC pensionARC contributed obligation

Fiscal year ended:2012 $ 54,310,693 65% $ (160,184,013)2011 49,945,979 61 (139,822,693)2010 55,488,062 44 (119,249,376)

Basis of Accounting — The Uniformed Plan’s financial statements are prepared using the accrualbasis of accounting and are presented as a pension trust fund in the accompanying financialstatements of the City. Plan member and employer contributions are recognized in the period inwhich the contributions are due. Benefits are provided based on a percentage of the member’s finalaverage compensation and are recognized when due and payable.

Method Used to Value Investments — Uniformed Plan assets are carried at fair value. Investments insecurities traded on a national securities exchange are valued at the latest quoted market prices.Unlisted investments are valued at net asset value.

Funding Status and Progress — The funding status and funding progress is as follows:(dollars in millions).

Actuarial UAAL as aActuarial accrued Unfunded percentagevalue of liability (AAL) AAL Funded Covered of covered

Actuarial assets entry age (UAAL) ratio payroll payrollvaluation date (a) (b) (b-a) (a/b) (c) ((b-a)/c)

2012 $ 467.4 1,077.6 610.2 43.4% $ 110 554.7%

The schedules of funding progress, presented as required supplementary information (RSI) following the notes to the financial statements,present multiyear trend information about whether the actuarial values of plan assets are increasing or decreasing over time relativeto the AALs for benefits.

74 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Summary financial information for the Uniformed Plan is as follows:

Assets

Cash and cash equivalents S 812,242Receivables:

Accounts receivable 1,501,122Accrued interest 1,749,160

Investments 486,501,246

Total assets S 490,563,770

Liabilities

Accounts payable and other current liabilities 5 763,631

Total liabilities 763,631

Net Position

Net position:Held in trust for pension benefits 489,800,139

Total liabilities and net position $ 490,563,770

Additions:Contributions:

Employer $ 35,302,037Employee 19,641,660

Total contributions 54,943,697

Investment income (loss):Dividends and interest 14,928,954Net appreciation in fair value of investments 42,603,277Investment expenses (2,489,092)

Net investment income 55,043,139

Total additions 109,986,836

Deductions:Benefit payments 60,616,088

Change in net position 49,370,748

Net position held in trust for pension benefits, beginning of year 440,429,391

Net position held in trust for pension benefits, end of year $ 489,800,139

75 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(11) Capital Assets

Capital asset activity for the year ended December 31, 2012 is as follows:

Beginning Endingbalances Increases Decreases balances

Governmental activities:Capital assets, not being

depreciated:Land $ 139,164,334 916,804 140,081,138Cultural assets 5,833,600 — 5,833,600Construction in progress 24,565,872 22,846,149 8,985,848 38,426,173

Total capital assets,not beingdepreciated 169,563,806 23,762,953 8,985,848 184,340,911

Capital assets, being depreciated:Buildings 557,114,585 6,454,378 411,259 563,157,704Machinery and equipment 73,624,161 4,855,168 2,989,349 75,489,980Infrastructure 754,972,918 23,525,200 778,498,118

Total capital assets,being depreciated 1,385,711,664 34,834,746 3,400,608 1,417,145,802

Less accumulated depreciation for:Buildings 212,097,268 15,901,466 280,695 227,718,039Machinery and equipment 49,188,790 4,942,843 2,710,616 51,421,017Infrastructure 189,661,883 29,055,984 218,717,867

Total accumulateddepreciation 450,947,941 49,900,293 2,991,311 497,856,923

Total capital assets,being depreciated,net 934,763,723 (15,065,547) 409,297 919,288,879

Governmentalactivitiescapital assets, net $ 1,104,327,529 8,697,406 9,395,145 1,103,629,790

In 2012, the City annexed SID #244; 300; 330; 370; 414; 416; 440; 447; and 553. As a result, capital assetsrelated to government wide of $16,543,347, net of accumulated depreciation of$1 1,999,290 were acquiredand capital assets related to sewer of $3,256,842, net of accumulated depreciation of $2,806,057, and debtof $12,285,378 was assumed in a noncash transaction. Current year additions to accumulated depreciationwere increased by the amount of existing depreciation on the acquired assets.

76 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Depreciation expense was charged to functions/programs as follows:

Governmental activities:General governmentPublic safetyCommunity developmentOther public servicesCulture and parksTransportation services

Total depreciation expense — governmental

Capital asset activity of each major enterprise fund is as follows:

ii$ 1,123,340

3,720,857853,696

1,060,74116,238,69814,903,671

$ 37,901,003

Convention Center Flotel Fund:Capital assets, not being

depreciated:Cultural assets

Beginningbalances

$ 718,020

Increases DecreasesEnding

balances

718,020

Capital assets, being depreciated:BuildingsMachinery and equipmentFurniture and fixtures

Total capital assets,being depreciated

Less accumulated depreciation for:BuildingsMachinery and equipmentFurniture and fixtures

Total accumulateddepreciation

Total capital assets,being depreciated, net

Convention Center HotelFund capitalassets, net

90,072,145 709,846 — 90,781,9913.587,790 386,282 3,974,072

14,282,642 60,705 14,343,347

107,942,577 1,156,833 109,099,410

13,976,221 2,493,012 16,469,2333,202,746 143,565 3,346,3111,923,078 2,806,086 4,729,164

19,102,045 5,442,663 24,544,708

88,840,532 (4,285,830) 84,554,702

$ 89,558,552 (4,285,830)

______________

85,272,722

77 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Beginning Endingbalances Increases Decreases balances

Parking Facilities Fund:Capital assets, not being

depreciated:Land $ 2,473,344

_____________

— 2,473,344

Total capital assets,not being depreciated 2,473,344 — — 2,473,344

Capital assets, being depreciated:Leased buildings and buildings 61,363,255

_______________ _______________

61,363,255

Total capital assets,being depreciated 61,363,255 — — 61,363,255

Less accumulated depreciation for:Leased buildings and buildings 30,738,230 2,410,197

______________

33,148,427

Total accumulateddepreciation 30,738,230 2,410,197 — 33,148,427

Total capital assets,being depreciated, net 30,625,025 (2,410,197) — 28,214,828

Parking Facilities Fundcapital assets, net $ 33,098,369 (2,410,197) — 30,688,172

78 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December3l,2012

Beginning Endingbalances Increases Decreases balances

Sewer Revenue Fund:Capital assets, not being

depreciated:Land $ 2,705,920 15,126 2,721,046Construction in progress 51,651,576 91,626,603 36,072,839 107,205,340

Total capital assets,not being depreciated 54,357,496 91,641,729 36,072,839 109,926,386

Capital assets, being depreciated:Buildings and systems 715,624,945 40,096,839 — 755,721,784Machinery and equipment 9,575,077 743,362 229,383 10,089,056

Total capital assets,being depreciated 725,200,022 40,840,201 229,383 765,810,840

Less accumulated depreciation for:Infrastructure 268,637,701 20,215,148 288,852,849Buildings and systems 36,902,199 1,098,378 — 38,000,577Machinery and equipment 6,868,324 532,417 229,383 7,171,358

Total accumulateddepreciation 312,408,224 21,845,943 229,383 334,024,784

Total capital assets,being depreciated, net 412,791,798 18,994,258

_____________

431,786,056

Sewer Revenue Fundcapital assets, net $ 467,149,294 110,635,987 36,072,839 541,712,442

79 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

Beginning Endingbalances Increases Decreases balances

Nonmajor Enterprise Funds:Capital assets, not being

depreciated:Construction in progress $

Capital assets, being depreciated:Buildings and systems 9,228,130 — 9,228,130Machinery and equipment 2,813,437 63,585 24,540 2,852,482

Total capital assets,being depreciated 12,041,567 63,585 24,540 12,080,612

Less accumulated depreciation for:Building and systems 4,575,250 311,676 — 4,886,926Machinery and equipment 2,207,667 130,788 24,540 2,313,915

Total accumulateddepreciation 6,782,917 442,464 24,540 7,200,841

Nonmajor Enterprisecapital assets, net $ 5,258,650 (378,879)

______________

4,879,771

(12) Fund Deficits

Fund deficits exist in the following funds as of December 31, 2012:

Major Enterprise Funds:Convention Center Hotel-Enterprise Fund $ (37,589,496)Parking Facilities-Enterprise Fund (4,751,032)

Nonmajor Special Revenue Funds:Keno/Lottery Proceeds (338,192)Community Park Development (2,422,707)Grants (918,431)Household Chemical Disposal (77,060)

Nonmajor Capital Projects Funds:Downtown Stadium and Companion Project (10,130,922)Missouri River Pedestrian Bridge (100,000)

Nonmajor Enterprise Funds:Golf Operations (1,772,000)Air Quality (405,351)Compost (522,971)Printing Services and Graphics (2,248)

80 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(a) Major Enterprise Funds

The Convention Center Hotel began operations in April 2004. The City projects that futureoperations of the hotel will eliminate this deficit. An addition of 150 rooms, a junior ballroom, andadditional meeting space were completed in 2012 and are expected to generate additional revenue toreduce the deficit. Several national-profile events have been secured for the adjoining Century-LinkCenter providing increased revenue stability. Annual appropriations from the City will subsidize anydebt service shortfall.

The Parking Facilities Fund was established as a tool to manage the City’s eight parking structuresand various surface lots throughout the City. Lease-purchase debt has been issued to finance theconstruction of the parking structures. The City recently completed a comprehensive parking study.Among the recommendations implemented to date are: the consolidation of all parking functionsunder one department — Public Works; and, the installation of new parking meters that accept bothcredit cards and coins. Under consideration are changes to parking fees, increased hours ofenforcement, and review of vendor and leasing contracts. The City has also hired a full-time parkingfacilities manager to oversee all parking operations. Annual appropriations from the City’s GeneralFund to subsidize the payment of this debt will eliminate this deficit.

(b) Voninajor Special Revenue Funds

The Community Park Development Fund’s deficit is a result of the acquisition of two large landpurchases. These sites are outside of the City and have been selected as future regional parks. A parkdevelopment fee has been established, which will be collected from neighboring SanitaryImprovement Districts to fund these acquisitions. Both Douglas and Sarpy Counties are contributingpartners to the Household Chemical Disposal Fund, along with the City; they have both agreed tomake one-time contributions to help eliminate this fund deficit. The other Nonmajor SpecialRevenue Fund deficits will be eliminated upon collection of advanced revenues from the sponsoringgrantor agency and reduction of expenses.

(c) Nonmajor Capital Funds

The Downtown Stadium fund deficit is the result of expenditures to complete the City’s newballpark. Pledged gifts will eliminate the deficit. The elimination of the fund deficit in the remainingNonmajor Capital Projects Fund will be accomplished by the receipt of advanced revenues.

(d) Nonmajor Enterprise Funds

The deficit in the Golf Operations, Air Quality Fund, Compost, and Printing Services and Graphicswill be eliminated by fee increases and reduction of expenses.

(13) Postretirement Healthcare Benefits

(a) Plan Description

The City sponsors a single-employer, defined benefit healthcare plan that provides certainpostemployment healthcare benefits to eligible retirees and their dependents up to age 65 when theywould be Medicare eligible in accordance with provisions established in Chapter 23 of the OmahaMunicipal Code. The benefits include medical and prescription coverage. The rates paid by retirees

81 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

Decernber3l,20l2

are substantially lower than they would be under individual health insurance policies. This differenceis an implicit rate subsidy and considered other post employment benefits (OPEB). The plan isadministered by the City. The plan does not issue separate financial statements.

(b) Funding Policy

The contribution requirements of plan members and the City are established through labornegotiations, with the Omaha Police Union Local No. 101, the Professional Firefighters Associationof Omaha Local No. 385, the Omaha City Employees Local No. 251, and other classified civilianand sworn employees. All agreements are approved and can be amended by the City Council.Contributions are made to the plan based on a pay-as-you-go basis and the City self-insures thisbenefit. For the year ended December 31, 2012, the City paid $15,642,584 for 916 retirees. Retireecontribution rates vary from 0% to 10% of an annual estimated premium depending on thebargaining group. Retiree contributions for 2012 were $439,174.

(c) Annual OPEB Cost and Net OPEB Obligation

The City’s annual other OPEB cost (expense) is calculated based on the annual required contributionof the employer (ARC), an amount actuarially determined in accordance with the parameters ofGASB Statement No. 45, Accounting and Financial Reporting by Employers for PostemploymentBenefits Other Than Pensions. The ARC represents a level of funding that, if paid on an ongoingbasis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (orfunding excess) over a period not to exceed 30 years. The amortization method used is the levelpercentage of projected payroll and the periods used on closed. The remaining amortization period is25 years. The unprojected-unit-credit-actuarial-cost method is used. The following table shows thecomponents of the City’s annual OPEB costs for the year, the amount actually contributed to theplan, and the changes in the City’s net OPEB obligation:

Normal cost $ 26,692,833Amortization of unfunded actuarial accrued liability 19,059,447Interest on net OPEB obligation 3,483,212Adjustments to annual required obligation (4,780,980)

Annual OPEB 44,454,512

Contributions made by employer (15,642,583)

Increase in net OPEB obligation 28,811,929

Net OPEB obligation, beginning of year (116,107,053)

Net OPEB obligation, end of year $ (144.918,982)

The net OPEB cost is allocated to governmental activities, sewer enterprise fund, and other nonmajorenterprise funds based on 2012 compensation expense.

82 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

The annual OPEB costs, the percentage of annual OPEB cost contributed, and the net OPEBobligation for 2012, 2011, and 2010 are as follows:

Percentage ofAnnual OPEB annual OPEB

cost contributed Net OPEB

Fiscal year ended:2012 $ 44,454,512 35% $ (144,918,982)2011 47,322,593 38 (116,107,053)2010 47,359,459 39 (86,604,366)

(d) Funded Status and Funding Progress

The funded status of the plan as of January 1, 2012 is as follows:

Actuarial accrued liability (AAL) $ 449,381,032

Actuarial value of plan assetsUnfunded actuarial accrued liability (UAAL) $ 449,381,032

Funded ratio

Covered payroll $ 164,200,000

UAAL as a percentage of covered payroll 274%

(e) Actuarial Methods and Assumptions

Actuarial valuations on an ongoing plan involve estimates of the value of reported amounts andassumptions about the probability of occurrence of events far into the future. Examples includeassumptions about future employment, mortality, and the healthcare cost trend. Amounts determinedregarding the funded status of the plan and the annual required contributions of the employer aresubject to continual revision as actual results are compared with past expectations and new estimatesare made about the future. The schedule of funding progress, presented as required supplementaryinformation following the notes to the financial statements, presents multiyear trend information,which shows the actuarial liability as a percentage of covered payroll.

Projections of benefits for financial reporting purposes are based on the substantive plan (the plan asunderstood by the employer and the plan members) and include benefits provided at the time of eachvaluation and the historical pattern of sharing benefit costs between the employer and plan memberto that point. In the January 1. 2012 actuarial valuation, the unprojected unit-credit-actuarial-costmethod was used. The actuarial assumptions included a 3% projected investment rate of return andan annual healthcare cost trend of 8.10% during 2012, reduced to an ultimate rate of 4.70% after71 years. Both rates include a 2.50% inflation assumption. The amortization of the unfundedactuarial accrued liability is calculated assuming 25 annual payments increasing at 2.75% per year.The amortization method used is the level percentage of projected payroll method and theamortization period is a closed 30-year period beginning in 2007.

83 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(14) Risk Management

The City is exposed to various risk of loss related to torts, theft of damage to, and destruction of assets;errors and omissions; injuries to employees; and natural disasters. The City is self-insured with respect toits obligation to provide workers’ compensation, general liability, property damage, unemploymentbenefits, health and dental coverage, environmental, and antitrust.

The City sets aside assets for claim settlements in the general and individual proprietary funds. These fundsservice all claims for risk of loss to which the City is exposed including general liability, property, andcasualty up to $100,000 per occurrence. The City also services claims including workers’ compensation,employee health and dental, environmental, and antitrust, which are subject to unlimited liability by theCity.

The City maintains a Judgment Fund for the purpose of accumulating funds to satisfy judgments, damageclaims, and related litigation expenses against the City. It is sustained by an unlimited tax levy upontangible property within the City.

The City obtains an annual funding valuation from a claims servicing company managing the appropriatelevel of estimated claims liability for workers’ compensation claims. Liabilities are reported when it isprobable that a loss can be reasonably estimated. Liabilities are based on historical losses paid.

The City maintains a blanket surety bond covering all City employees, including those of the city clerk’soffice and the public libraries, in the amount of $250,000.

The City purchases commercial insurance for property damage of City buildings and contents in excess of$100,000. Settled claims have never exceeded this commercial coverage.

The City purchases commercial insurance for aviation liability for the police aviation unit, in the amount of$1,000,000 per person and $5,000,000 per occurrence for personal injury, and $200,000 for propertydamage. Settled claims have never exceeded this commercial coverage.

Changes in the balance of claims liabilities during the fiscal years 2012 and 2011 for workers’compensation and employee health and dental are as follows:

Beginning Current Endof year year Claim of yearliability claims payments liability

2012 $ 35,913,900 59,868,355 54,630,649 41,151,6062011 31,893,436 59,361,421 55,340,957 35,913,900

(15) Commitments and Contingencies

(a) Judgment Claims

The City is a defendant in a number of lawsuits in its normal course of operations. In addition to the$1,950,000 recorded by the City as claims and judgments payable, the City Attorney is of the

84 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

opinion that there is a possibility that the City will incur additional losses on various lawsuits ofapproximately $6,540,000.

(b) Grants

The City participates in a number of federally assisted grant programs, principally Federal HighwayConstruction Grants, HUD Grants, Office of Justice Prevention Grants, Homeland Security,Department of Energy and Department of Transportation Grants, and other local improvementprograms. The programs are subject to financial and compliance audits. The amount of expenditures,if any that may be disallowed by granting agencies is not determinable at this time; however, Citymanagement does not believe that such amounts, if any, would be significant.

(c) Encumbrances

An encumbrance is the commitment of appropriated funds to purchase goods or services to bedelivered or performed at a future date. On a budget basis, an encumbrance is a reserve of fundbalance. The encumbrances are generally in a requisition form before the end of the budget year. Thepurchasing process must be initiated before year-end. The encumbrances do not lapse at year-end.Department heads are authorized to make or approve encumbrances in their respective departments.Contracts or purchase orders over $20,000 are approved by the City Council. Encumbrances areincluded in restricted, committed, assigned, or unassigned fund balances as appropriate.Encumbrances are detailed in the following table:

Govemmental funds:General $ 7,980,543Special revenue 4,518,062Capital projects 9,423,151

Total encumbrances $ 21,921,756

(d) Construction Commitments

The City has various construction projects; specifically, the sewer fund is used to account for incomefrom sewer service charges, construction grants and related expenditures for operation, maintenanceand capital improvements of the sanitary sewer system and wastewater treatment plants. The City’sobligation under these construction commitments is $96,274,780 as of December 31, 2012.

85 (Continued)

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86(C

ontin

ued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(17) Subsequent Events

The City has evaluated subsequent events from the financial statement date through July 31, 2013, the dateat which the financial statements were issued, and determined there were no items to disclose.

(18) Discretely Presented Component Units

(a) Cash and Investments

As of June 30, 2012, the investment balances of the discretely presented components are as follows:

MECA

Investment Maturities Credit rating Fair value

Certificates of deposit 7/27/12-5/24/13 100% FDIC Insured $ 5,880,000Commercial paper 8/1/12 - 11/13/12 S&P-Al and Moody’s P1 6,892,881U.S. Treasury securities 10/31/12 - 5/15/13 N/A 5,495,905Government agency

discount notes 8/3/12 - 1/3/13 N/A 2,899,014

Totalinvestments $ 21,167,800

HWS had no investments.

(b) Capital Assets

Activity for the year ended June 30, 2012 for both of the component units’ property, equipment, andintangible assets and accumulated depreciation and amortization is as follows:

Additions &July 1, 2011 Reclassifications Dispositions June 30, 2012

Leasehold improvements $ 6,075,157 1,587,763 (3,070) 7,659,850Fumiture, fixtures, and

equipment 10,359,078 1,866,440 (387,351) 11,838,167Building rights 10,079,196

— 10,079,196Construction in progress 386,422 267,247

_____________

653,669

26,899,853 3,721,450 (390,421) 30,230,882

Accumulated depreciationand amortization (11,370,228) (1,839,460) 389,882 (12,819,806)

Total $ 15,529,625 1,881,990 (539) 17,411,076

87 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(c) Long- Term Debt

MECA’s long-term debt activity for the year ended June 30, 2012 is as follows:

Balance Balance,June 30, 2011 Additions Reductions June 30, 2012

City of Omaha $ 4,157,729 — (675,946) 3,481,783Food service contract 652,575 (326,280) 326,295

Total $ 4,810,304 (1,002,226) 3,808,078

Through the amended agreement and lease with the City, MECA agreed to exercise good faith andbest efforts to raise and pay over to the City the sum of $14,000,000 to offset additional fundsprovided by the City for the construction of the facility. Proceeds from the sale of Naming Rightswere specifically identified as a source of repayment. The Naming Rights have been sold to anoutside party under a Convention Center/Arena Naming Rights Agreement, which terminates onSeptember 1, 2018. As a result, the obligation for the repayment of this portion of the constructionfunds has been recorded as long-term debt payable to the City offset by recording intangibleBuilding Rights.

Under a long-term contract for food service operations, MECA received a $4,000,000 interest-freeloan from the contractor for the purchase of food service equipment and leasehold improvements.The loan is to be repaid over the 10-year period of the contract, which began in July 2003.

MECA’s Debt service payments for the City and food service contract debt are as follows:

Principal Interest

Year:2013 $ 1,002,241 149,0542014 675,946 149,0542015 575,946 149,0542016 575,946 149,0542017 575,946 149,054Thereafter 402,053 173,895

$ 3,808,078 919,165

HWS has no long-term debt.

88 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Basic Financial Statements

December 31, 2012

(d) Commitments and Contingencies

MECA — Food Service Contract

MECA entered into a long-term contract for food service operations in November 2001. The termsof the contract commit MECA to a 10-year CPI indexed annual payment to the contractor of$727,226 and $715,493 for the years ended June 30, 2012 and 2011. There are incentive provisionsin the contract that may result in additional payments to the contractor. Such incentives totaled$181,807 for the year ended June 30, 2012. The remaining cost of such commitments as of June 30,2012 is as follows:

Year ending June 30:2013 $ 1,000,000

$ 1,000,000

89

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REQUIRED SUPPLEMENTARY INFORMATION(Unaudited)

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CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — General Fund

(Unaudited)

Year ended December 31, 2013

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Property tax S 78,519,348 78,519,348 79,123,615 604,267Motor vehicle taxes 9,408,238 9,408,238 9,163,518 (244,720)City sales and use tax 131,466,507 131,466,507 131.859,046 392,539Business taxes 20,789,410 20,789,410 21.694,969 905,559Taxes in lieu 4,877,090 4,877,090 3.956,031 (921,059)Licenses and pennits 8,620.323 8,620,323 8.4 17.387 (202,936)Intergovernmental revenues — — (480) (480)Charges for services 19,252,164 19,252,164 20,613,005 1,360.841Revenue for KENO 545,865 545,865 554,533 8,668interest income 1,375,000 1,375,000 682,977 (692,023)Rent and royalties 204,000 204,000 965,061 761,061Miscellaneous 1,639,475 1,639,475 107,663 (1,531,812)Restaurant Tax 19,084,888 19,084,888 24,851,426 5,766,538Business Usage 12,440,078 12,440,078 11,348,853 (1,091,225)Revenue from Stadium 3,631,921 3,631,921 3,720,401 88,480

Total revenues 311,854,307 311,854,307 317,058,005 5,203,698

Expenditures:General government:

Mayor’s office 1.148.254 1,148,254 1,229,177 (80,923)Cityclerks 636,413 643,124 614,917 28,207City council 1,092,322 1,093,598 1.098,201 (4,603)Law 3,708,511 3,721,157 3,586,217 134,940Human Resources 2,098,769 2.100,091 2.191,542 (91,451)Human Rights and Relations 405,874 466,375 340,588 125,787Finance 3,300,346 3,303,506 3,282,205 21,301Planning 6,972,304 6,972,304 7,095,017 (122.713)Employee benefits 26,199,899 26,199,899 19,449,521 6,750.378Other agencies 37,286,409 31,907,651 27.557,329 4,350,322Stadium Expenses 3,552,267 3,552,267 4,359,502 (807,235)

Total general government 86,401,368 81,108,226 70,804,216 10,304,010

Public safety:Fire 66,914,984 71,566,530 78,719,244 (7,152,714)Police 115,920,343 115,931,325 115,622,102 309,223

Total public safety 182,835,327 187,497,855 194,341,346 (6,843,491)

Public works:Environmental 15,864,230 15,717,434 15,151,693 565,741Street and highway 673,927 1,583,997 2,628,420 (1,044,423)

Total public works 16,538,157 17,301,431 17,780,113 (478,682)

Culture and recreation:Parks and recreation 17,688,172 17,688,172 18,538,311 (850,139)Libraries 10.564,133 10,564,133 10,660,030 (95,897)

Total culture and recreation 28,252,305 28,252,305 29,198,341 (946,036)

Total expenditures 314,027,157 314,159,817 312,124,016 (2,035,801)

(Deficiency) exeessofrevenues overexpenditures (2,172,850) (2,305,510) 4,933,989 7,239,499

Net changes in fund balances (2,172,850) (2,305,510) 4,933,989 7,239,499

Fund balances — beginning of year — — 5,730,091 5,730,091Lapsed encumbrances — — 1,480,750 1,480,750Transfers out

— — (70,200) (70,200)Transfers in — — — —

Fund balances — end of year S (2,172,850) (2,305,510) 12,074,630 14,380,140

See accompanying notes to schedule of revenues. expenditures. and changes in fund balances — budget and actual — general fund.

90

CITY OF OMAHA, NEBRASKA

Notes to Budgetary ComparisonSchedule — General Fund

Unaudited

Year ended December 31, 2012

(1) Budget and Budgetary Accounting

The Mayor is required by the City Charter to prepare and submit an annual budget to the City Council. Abudget is prepared for the general fund and all special revenue funds, exclusive of all grant funds and theservice-type special assessments fund. These budgets are prepared primarily on a cash basis for revenuesand modified accrual basis for expenditures. The budget presented reflects the original budget and therevised budget prior to the closing ordinance. In addition, encumbrances are reported as expenditures forbudgetary purposes. Under this system, purchase orders, contracts, and other commitments for theexpenditure of funds are recorded as encumbrances in order to reserve a portion of the applicableappropriation.

Budgetary control is maintained by department/division and by the following category of expenditures:personnel services, nonpersonnel services, capital outlay, and debt service. All budget amendments mustbe approved by the Mayor and/or City Council. Unencumbered appropriations lapse at the end of the fiscalyear. Encumbered funds are carried over to the ensuing fiscal year until utilized or canceled.

The City Charter also requires the City Council each year to make an ad valorem tax levy for a sinkingfund (debt service fund) that shall provide for principal and interest payments on the general obligationbonded indebtedness of the City.

Appropriations for certain special revenue funds and capital projects funds are controlled on a project basisand are carried forward each year until the project is completed or grant funds are expended.

Budgets are also prepared for the proprietary funds as a management control device. The budgets for thesefunds are prepared on a revenue and expenditure basis similar to the budgets for the governmental fundtypes.

(2) Reconciliation of Budget-Basis Revenues and Expenditures to GAAP

Revenue and expenditures presented on a non-GAAP budget basis of accounting differ from the revenuesand expenditures presented in accordance with GAAP because of the different treatment of encumbrancesand accruals (revenue recognition).

In addition, Section 5.14 of the City of Omaha’s Home Rule Charter requires, in relevant part, that theyear-end general fund balance “. . . be applied as general fund revenue in the budget for the fiscal year twoyears subsequent to that fiscal year.” Therefore, the amount of the general fund carryover coming into aparticular fiscal year has already been determined. Any general fund encumbrances at the end of a fiscalyear are not included in the year-end general fund balance because those encumbrances will normally needto be paid in the following fiscal year and cannot be held until the fiscal year two years subsequent to thefiscal year when the encumbrance was incurred.

91 (Continued)

CITY OF OMAHA, NEBRASKA

Notes to Budgetary ComparisonSchedule — General Fund

Unaudited

Year ended December 31, 2012

All general fund encumbrances are charged to the appropriate accounts at the end of the fiscal year. Thisallows those funds to be kept separate from the year-end general fund balance. Therefore, when the actualpayments to the vendors are required in the following fiscal year, there are general fund moneys available.A reconciliation of the differences between the budgetary versus GAAP is presented as follows:

General fund

Budget basis:2ol2carryoverto2ol4 $ 2,714,3132011 carryover to 2013 9,360,317

Total budget basis fundbalance 12,074,630

Basis differences:Cash reserve 4,044,945Contingent liability reserve 7,254,018Taxes accrued 21,031,332Accrued interest 126,301Encumbrances 2,682,705Inventories 694,950

GAAP basis fund balance $ 47,908,881

(3) Expenditures in Excess of Budget

Budgeted expenditures were exceeded in the following departments/divisions:

Department/division Amount

General fund:Mayor’s Office $ (80,923)City Council (4,603)Human Resources (91,451)Planning (122,713)Public safety:

Fire (7,152,714)Public works:

Street and highway (1,044,423)Culture and parks:

Parks and recreation (850,139)Libraries (95,897)

Stadium (807,235)

92

CITY OF OMAHA, NEBRASKA

Schedules of Funding Progress and Employer Contributions

Year ended December 31, 2012

Unaudited

Civilian Plan Schedule of Funding Progress(Dollars in millions)

Actuarial UAAL as aActuarial accrued Unfunded percentagevalue of liability (AAL) AAL Covered of coveredassets entry age (UAAL) Funded ratio payroll payroll

Actuarial valuation date (a) (b) (b-a) (a/b) (c) ((b-a)/c)

2012 $ 236.7 420.8 184.1 56.3% $ 62.8 293.2%2011 240.3 409.4 169.1 58.7 59.2 285.62010 232.4 414.5 182.1 56.1 56.7 321.22009 213.2 402.8 189.6 52.9 55.7 340.42008 204.5 387.7 183.2 52.7 56.4 324.82007 294.7 369.0 74.3 79.9 54.0 137.6

Civilian Plan Schedule of Employer Contributions

Annual required Percentage Netcontribution of ARC pension

Fiscal year ended (ARC) contributed obligation

2012 $ 15,658,045 46% $ (50,279,955)2011 14,564,847 45 (41,532,413)2010 14,149,386 41 (33,263,609)2009 12,893,331 42 (25,052,987)2008 9,212,669 59 (17,626,003)2007 8,883,617 56 (13,910,207)

Uniformed Plan Schedule of Funding Progress(Dollars in millions)

Actuarial UAAL as aActuarial accrued Unfunded percentagevalue of liability (A.AL) AAL Covered of coveredassets entry age (UA.AL) Funded ratio payroll payroll

Actuarial valuation date (a) (b) (b-a) (a/b) (c) ((b-a)/c)

2012 $ 467.4 1,077.6 610.2 43.4% $ 110.0 554.7%2011 456.2 1,028.9 572.7 44.3 105.0 545.42010 452.6 1,093.3 640.7 41.4 111.2 576.22009 405.4 1,026.0 620.6 39.5 104.0 596.72008 365.9 947.6 581.7 38.6 99.5 584.62007 530.8 882.7 351.9 60.1 99.6 353.3

93 (Continued)

CITY OF OMAHA, NEBRASKA

Schedules of Funding Progress and Employer Contributions

Year ended December31, 2012

Unaudited

Uniformed Plan Schedule of Employer Contributions

Annual required Percentage Netcontribution of ARC pension

Fiscal year ended (ARC) contributed obligation

2012 S 54,310,693 65% $ (160,184,013)2011 49,945,979 61 (139,822,693)2010 55,488,062 44 (119,249,376)2009 50,507,561 45 (88,728,048)2008 38,073,021 57 (61,464,670)2007 34,842,280 60 (45,494,051)

Postretirement Obligation Schedule ofFunding Progress

(Dollars in millions)

Schedule of Funding ProgressUAAL as a

Actuarial Actuarial Unfunded percentagevalue of accrued AAL Covered of covered

assets liability (AAL) (UAAL) Funded ratio payroll payrollActuarial valuation date (a) (b) (b-a) (a-b) (c) ((b-a)fc)

January 1,2012 S — 449.4 449.4— $ 164.2 274%

March 1,2010 — 478.1 478.1 167.9 285March 1,2008 — 388.5 388.5 153.6 253

94

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NONMAJOR GOVERNMENTAL FUNDS

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CITY OF OMAHA, NEBRASKA

Combining Balance Sheet

Nonmajor Governmental Funds

December31, 2012

TotalNonmajor

Special Debt Capital Permanent GovernmentalAssets revenue service projects funds Funds

Cash and pooled investments $ 22,500,899 3,387,083 8,248,766 97,359 34,234,107Investments — — 1,500,544 3,065,075 4,565,619Receivables (net of allowance for uncolleetibles) 4,319,092 7,385,023 16,412,956 — 28,117,071Due from other governments 16,004,607 387,060 345,547 — 16,737,214Accrued interest 40,455 — 3,317 16,893 60,665Other assets 498,899 498,899Restricted assets:

Deposits with trustee 2,889,427

_____________

7,990,515

_____________

10,879,942

Total assets S 45,754,480 11,159,166 35,000,544 3,179,327 95,093,517

Liabilities and Fund Balances

Liabilities:Accounts payable and other current liabilities $ 5,738,748 11,946 3,792,807 — 9,543,501Due to other governments — — 25,000 — 25,000Uneamed revenue 4,612,453 1,421 — 4,613,874Advances 8,788,693 7,346,109 15,768,281 — 31,903,083

Total liabilities 19,139,894 7,359,476 19,586,088

______________

46,085,458

Fund balances (deficit):Nonspendable — — — 2,775,389 2,775,389Restricted 17,341,217 3,799,690 13,683,425 — 34,824,332Committed 12,774,962 — 5,525,136 403,938 18,704,036Assigned 254,797 — 6,436,817 — 6,691,614Unassigned (3,756,390) — (10,230,922) — (13,987,312)

Total fund balance 26,614,586 3,799,690 15,414,456 3,179,327 49,008,059

Total liabilities and fund balance $ 45,754,480 11,159,166 35,000,544 3,179,327 95,093,517

Sec accompanying independent auditors’ report.

95

CITY OF OMAHA, NEBRASKA

Combining Statement of Revenues, Expenditures, and Changes in Fund Balances

Nonmajor Governmental Funds

Year ended December31, 2012

TotalNonmajor

Special Debt Capital Permanent Governmentalrevenue service projects funds Funds

Revenues:Taxes:

Property S 1,671,346 6,260,102 — 7,931,448Business 717,492 — — 717,492In lieu 6,104 16,218 — — 22,322

Licenses and grants 1,536,249 — — — 1,536,249Intergovernmental 38,220,823 1,500,000 — — 39,720,823Investment income 37,013 26,813 298,046 83,116 444,988Revenue from Keno 6,665,750 — 6,665,750Charges forservices 30,153,260 — 1,309,342 — 31,462,602Rents, royalties, and other 20,838,523 825,000 193 — 21,663,716Contributions and grants 33,121,915 267,911 16,492,202 — 49,882,028

Total revenues 132,968,475 8,896,044 18,099,783 83,116 160,047,418

Expenditures:Governmental activities:

General government 8,976,031 54,428 114,642 — 9,145,101Public safety 6,472,324 — 285,960 — 6,758,284Transportation services 47,783,487 70,000 — 47,853,487Other public services 13,098,520 — — — 13,098,520Community development 18,868,854 — 141,309 — 19,010,163Culture and parks 4,689,069 203,497 73,750 4,966,316

Debt service:Principal 282,335 3,985,264 629,054 — 4,896,653Interest 2,162,727 5,323,955 45,249 — 7,531,931Bond issuance costs — 420,835 72,138 — 492,973

Capital outlay:Other public services 542,602 866,101 — 1,408,703Public safety — — 3,130,138 — 3,130,138Culture and parks 109,890 — 7,904,145 — 8,014,035General government — — 1,564,289 — 1,564,289Transportation 2,144,733 — 12,438,523 — 14,583,256Community development — — 3,861,837 — 3,861,837

Total expenditures 105,130,572 9,784,482 31,326,882 73,750 146,315,686

Other financing sources (uses):Transfers in 690,088 - 1,486,647 — 2,176,735Transfers Out (1,489,870) — (587,137) — (2,077,007)Sale of capital assets — — 658,000 — 658,000Proceeds from the issuance of bonds —- 11,785,000 30,770,862 — 42,555,862Proceeds of refunding bonds — 35,067,065 — — 35,067,065Proceeds from bond premium — 1,815,011 2,258,883 — 4,073,894Discount on sale of bonds — (3,922) — (3,922)Payment to refunded bond escrow agent — (47,877,188) — — (47,877,188)

Total other financing sources (uses) (799,782) 789,888 34,583,333 — 34,573,439

Net change in fund balance 27,038,121 (98,550) 21,356,234 9,366 48,305,171

Beginning fund balance (423,535) 3,898,240 (5,941,778) 3,169,961 702,888

Ending fund balance $ 26,614,586 3,799,690 15,414,456 3,179,327 49,008,059

See accompanying independent auditors’ report.

96

SPECIAL REVENUE FUNDS

juqqoiLilnuopuow!ohdsp

CITY OF OMAHA, NEBRASKA

Nonmajor Governmental Funds

Special Revenue Funds

Special Revenue Funds account for the proceeds from specific revenue sources that are restricted to expendituresfor specified purposes.

Judgment Fund — To accumulate resources for the purpose of providing a means to satisfy judgments, damageclaims, and related litigation expenses against the City. It is sustained by a Judgment Fund tax levy upon tangibleproperty. The actual and projected revenues are derived from a levy of 0.6 cents per $100 in 2007 —2012.

Public Library Contribution Fund — To accumulate and hold special contributions for the library from outsidesources. Funds are generally restricted for specific purposes to enhance library operations. The trust fundincludes grants, gifts, State Aid, and contributions from Friends of the Library and the Library Foundation.

Library Fines and Fees Fund — To account for the revenues generated through fees and fines collected by theLibrary.

Douglas County Library Supplement Fund — To account for the revenue generated by a property tax levyassessed on Douglas County residents living in unincorporated areas. The Douglas County Board passed thislevy in 1995 for the purpose of providing countywide funding for the Omaha Public Library System.

Miscellaneous Contribution Fund — To account for money collected and encumbered into this ExpendableTrust Fund. These short-term “small funds” are not large enough for the creation of a fund and are established forthe sole purpose of private entity or individual contributions for specific usage of funds. Organizations withcurrent year activity or previous year balances are shown individually on the Organization Sheet.

Keno/Lottery Proceeds Fund — To accumulate resources from the City’s percentage of Keno revenue in theCity and account for activities financed with Keno revenues.

SIB Administrative Fee Revenue Fund — To collect a 1% fee on Sanitary and Improvement District finalconstruction costs. The City ordinance #36247 passed April 29, 2003 authorized the City to collect a 1% fee (1%of final construction costs) from subdivision applications using Sanitary and Improvement District (SID)financing.

Storm Water Fee Revenue Fund — To account for revenues collected from a fee charged to all retailMetropolitan Utilities District customers. The funds are used to implement administrative requirements of theNPDE5 Storm Water Permit issued by the Nebraska Department of Environmental Quality in 2003. Thisfunction is mandated by the Environmental Protection Agency of the Federal Government.

City Street Maintenance Fund — To account for the usage of City motor vehicle registration fees and street cutfees. The City Motor Vehicle Registration Fee was increased to $50.00 per passenger vehicle, with a graduatedschedule for larger vehicles. The street cut fee, derived from local utilities and contractors, is based upon the sizeof the street cut. Use of funds is restricted to street maintenance and repair purposes and their related costs.

Street and Highway Allocation Fund — To account for usage of State shared vehicle user taxes allocated to theCity. Usage of fund proceeds is restricted to street maintenance, improvements, and related purposes. In additionto the state gasoline tax portion, cities and counties divide an additional 2 cents per gallon as authorized by the1985 State Legislature.

97 (Continued)

CITY OF OMAHA, NEBRASKA

Nonmajor Governmental Funds

Special Revenue Funds

Interceptor Sewer Construction Fund — To accumulate resources from the Special Sewer Connection Feescharged to new plats outside the City limits within the Papillion Creek Watershed and existing platted lots asthey are developed. These fees are used to finance the extension and/or relief of existing interceptor sanitarysewers in the Papillion Creek Watershed Basin.

Community Park Development Fund — To account for the costs of community park acquisition, and parkimprovements in suburban Omaha. In addition, subdivision agreements include provisions for revenues to becollected from Sanitary Improvement Districts at appropriate debt to value intervals.

Storm Water Management Plan Program — To account for storm water planning grants received. These fundsare used primarily for implementation.

State Turn Back Revenue Fund — To account for money collected upon adoption of LB 551 by the StateLegislature and amended in 2008 by LB 754 and LB 912. The City receives 70% of the state sales tax collectedthrough the Qwest Center Omaha and the Hiltbn hotel. The majority of these funds are used to repay the QwestCenter debt. The remaining 10% of the City’s revenue from this source is to be distributed for tourism-relatedpurposes in the areas of the City with high concentrations of poverty.

Ballpark Revenue Fund — With the passage of City Ordinance #68123 dated June 1, 2008, the City Councilestablished the Ballpark Revenue Fund. The purpose of this special revenue fund is to accumulate excess CollegeWorld Series revenues for any purpose related to the New Stadium or its operations. The annual excess of PublicFunds that exceed the stadium debt service or the Variable Funds that exceed planned projections are to bedeposited into this fund. The City’s portion of College World Series revenue shall also be deposited into thisfund. The City may retain all Public Surplus Funds in the event the fund balance of this fund exceeds$10,000,000.

Keno Lottery Reserve Fund — To account for the reserve perpetual fund in accordance with OrdinanceNo. 34688 passed in 1998. Twenty-five (25%) of all Keno revenue must be credited to this fund until the fundbalance reaches $2,370,000. After this reserve fund reaches $3,000,000, 25% of the interest earned stays in thefund; 75% is appropriated as permitted.

Grants Fund — To account for costs associated with activities related to various grants received by the City,which are designated for a specific purpose or period of time.

Greater Omaha Convention and Visitors Bureau Fund — To account for the operations of the Greater OmahaConvention and Visitors Bureau, which is a City department established to improve the City’s economy byattracting conventions and visitors.

Household Chemical Disposal Fund — To account for funds related to the collection of household hazardouswaste. In August 2001, an Interlocal Agreement between Omaha, Douglas, and Sarpy counties was executed toestablish a regional collection center for household hazardous waste (HHW).

Development Revenue Fund — To record fees collected on Tax Increment Financing (TIF) projects inaccordance with the City of Omaha Municipal Code, Section 24-150, Fees: Tax Increment FinancingApplications, Processing and Administration. Funds received will be used to fund additional staff required toadminister the processing of TIF applications.

98 (Continued)

CITY OF OMAHA, NEBRASKA

Nonmajor Governmental Funds

Special Revenue Funds

Technology and Training — To account for technology and training fees from any permit, inspection, zoningapproval, subdivision approval, board application, or other item sought from or performed by the PlanningDepartment. Fees collected will be used to defray the costs of enhancing the technological resources and trainingof the Planning Department. This is City Council ordinance number 39121.

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107

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Judgment Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Taxes property S 1,656,119 1,656,119 1,671,346 15,227Taxes in lieu 2,531 2,531 6,104 3,573

Total revenues 1,658,650 1,658,650 1,677,450 18,800

Expenditures:General government 2,007,402 2,007,402 3,237,766 (1,230,364)Culture and parks

_______________

— 2,534 (2,534)

Total expenditures 2,007,402 2,007,402 3,240,300 (1,232,898)

Excess (deficiency) of revenuesover expenditures (348,752) (348,752) (1,562,850) (1,214,098)

Net change in fund balances (348,752) (348,752) (1,562,850) (1,214,098)

Fund balances—beginning 2,645,377 2,645,377 4,203,136 1,557,759

Fund balances—ending $ 2,296,625 2,296,625 2,640,286 343,661

See accompanying independent auditors’ report.

108

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Library Fine and Fees Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Charges for services $ 440,755 440,755 454,880 14,125

Total revenues 440,755 440,755 454,880 14,125

Expenditures:Culture and parks 564,925 564,925 564,925 —

Total expenditures 564,925 564,925 564,925 —

Excess of revenues overexpenditures (124,170) (124,170) (110,045) 14,125

Net change in fund balance (124,170) (124,170) (110,045) 14,125

Fund balances — beginning 125,822 125,822 112,706 (13,116)

Fundbalances—ending $ 1,652 1,652 2,661 1,009

See accompanying independent auditors’ report.

109

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Douglas County Library Supplement Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

____________________________________

positive

________________ ________________ ________________

(negative)

Revenues:Intergovernmental

_________________ _________________ __________________ _________________

Total revenues

Expenditures:Culture and parks

______________ _______________ _______________ _______________

Total expenditures

______________ _______________ _______________ _______________

Excess of revenues overexpenditures

________________ ________________ _________________ ________________

Net change in fund balance

Fund balances— beginning

_______________ _______________ ________________ _______________

Fund balances — ending

See accompanying independent auditors’ report.

Budgeted amountsOriginal Final Actual

5 1,175,000 1,175,000 1,976,851 801,851

1,175,000 1,175,000 1,976,851 801,851

1,300,000 1,300,000 1,300,000

1,300,000 1,300,000 1,300,000 —

(125,000) (125,000) 676,851 801,851

(125,000) (125,000) 676,851 801,851

257,897 257,897 501,389 243,492

$ 132,897 132,897 1,178,240 1,045,343

110

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule Keno/Lottery Proceeds Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Investment income 330 330Revenue from keno $ 5,518,930 5,518,930 6,665,750 1,146,820

Total revenues 5,518,930 5,518,930 6,666,080 1,147,150

Expenditures:General government 120,000 120,000 1,356,938 (1,236,938)Public safety 1,196,000 1,196,000 720,994 475,006Other public services — — 120,000 (120,000)Community development 685,000 685,000 683,405 1,595Culture and parks 1,375,000 1,375,000 1,375,000Debt service:

Interest 2,172,714 2,172,714 2,116,041 56,673

Total expenditures 5,548,714 5,548,714 6,372,378 (823,664)

Excess of revenues overexpenditures (29,784) (29,784) 293,702 323,486

Other financing uses:Transfers out (476,000) (476,000)

Total other financing —— (476,000) (476,000)

Net change in fund balance (29,784) (29,784) (182,298) (152,514)

Fund balances — beginning 23,910 23,910 (155,894) (179,804)

Fund balances — ending $ (5,874) (5,874) (338,192) (332,318)

See accompanying independent auditors’ report.

Ill

CITY OF OMAHA, NEBRASKA

Budgetaiy Comparison Schedule — SID Administrative Fees Revenue Fund

Year ended December 31, 2012

(lJnaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Charges for services $ 70,000 70,000 27,493 (42,507)

Total revenues 70,000 70,000 27,493 (42,507)

Expenditures:Community development 62,000 62,000 27,493 34,507Transportation services 38,000 38,000

_______________

38,000

Total expenditures 100,000 100,000 27,493 72,507

Excess of revenues overexpenditures (30,000) (30,000)

_______________

30,000

Net change in fund balance (30,000) (30,000) 30,000

Fund balances — beginning 30,000 30,000

_______________

(30,000)

Fund balances — ending $ —

See accompanying independent auditors’ report.

112

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Storm Water Fee Revenue Fund

Year ended December 31, 2012

(Unaudited)

Revenues:Charges for services

Total revenues

Expenditures:Other public servicesCapital outlay

Total expenditures

Excess of revenues overexpenditures

Net change in fund balance

Fund balances — beginning

Fund balances — ending

Budgeted amountsOriginal Final

$ 1,200,000 1,200,000

1,200,000 1,200,000

1,212,244 1,212,24451,910 51,910

1,264,154 1,264,154

(64,154) (64,154)

(64,154) (64,154)

872,974 872,974

$ 808,820 808,820

Actual

1,767,151

1,767,151

1,126,80745,732

1,172,539

594,612

594,612

1,287,684

1,882,296

Variance withfinal budget

positive(negative)

567,151

567,151

85,4376,178

91,615

658,766

658,766

414,710

1,073,476

See accompanying independent auditors’ report.

113

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — City Street Maintenance Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Charges for services $ 25,458,376 25,458,376 25,141,864 (316,512)Rents and royalties 26,006 26,006Contributions and grants 300,000 300,000 357,143 57,143

Total revenues 25,758,376 25,758,376 25,525,013 (233,363)

Expenditures:General government 400,000 400,000 459,649 (59,649)Transportation services 23,947,525 23,947,525 24,369,845 (422,320)Culture and parks 286,991 286,991 201,784 85,207

Total expenditures 24,634,516 24,634,516 25,031,278 (396,762)

Deficiency of revenuesover expenditures 1,123,860 1,123,860 493,735 (630,125)

Other financing uses:Transfers out

Total other financing uses — — — —

Net change in fund balances 1,123,860 1,123,860 493,735 (630,125)

Fund balances — beginning (1,123,860) (1,123,860) 2,810,027 3,933,887

Fund balances — ending $ — 3,303,762 3,303,762

See accompanying independent auditors’ report.

114

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Street and Highway Allocation Fund

Year ended December 31 • 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Intergovernmental $ 29,593,405 29,593,405 32,469,853 2,876,448Charges for services 40,000 40,000 1,342,169 1,302,169Rents and royalties

— 671,478 671,478Contributions and grants 619,017 619,017 30,339 (588,678)

Total revenues 30,252,422 30,252,422 34,513,839 4,261,417

Expenditures:General government 1,434,582 1,434,582 3,208,558 (1,773,976)Transportation services 29,996,134 29,996,134 23,413,642 6,582,492Culture and parks 14,595 14,595 14,595Debt service:

Principal 180,000 180,000 180,000Interest 73,578 73,578 43,609 29,969

Capital outlay 2,488,000 2,488,000 2,144,733 343,267

Total expenditures 34,186,889 34,186,889 29,005,137 5,181,752

Excess of revenues overexpenditures (3,934,467) (3,934,467) 5,508,702 9,443,169

Other financing sources (uses):Transfers out (100,000) 100,000

Total other financing sources (uses) — — (100,000) 100,000

Net change in fund balance (3,934,467) (3,934,467) 5,408,702 (9,343,169)

Fund balances — beginning 5,750,651 5,750,651 4,332,615 (1,418,036)

Fundbalances—ending $ 1,816,184 1,816,184 9,741,317 7,925,133

See accompanying independent auditors’ report.

115

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Interceptor Sewer Construction Fund -

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Licenses and permits $ 550,000 550,000 1,114,175 564,175

Total revenues 550,000 550,000 1,114,175 564,175

Expenditures:Other public services 1,700,000 1,700,000 — 1,700,000

Total expenditures 1,700,000 1,700,000 — 1,700,000

Deficiency of revenuesover expenditures (1,150,000) (1,150,000) 1,114,175 2,264,175

Other financing sources (uses):Transfers inTransfers out

— (767,158) 767,158

Total other financing uses —— (767,158) 767,158

Net change in fund balance (1,150,000) (1,150,000) 347,017 1,497,017

Fund balances — beginning 1,714,136 1,714,136 2,998,380 1,284,244

Fundbalances—ending $ 564,136 564,136 3,345,397 2,781,261See accompanying independent auditors’ report.

116

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Community Park Development Fund

Year ended December31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Charges for services $ 160,000 160,000 248,694 88,694

Total revenues 160,000 160,000 248,694 88,694

Expenditures:Debt service:

Principal 98,401 98,401 102,335 (3,934)Interest 7,012 7,012 3,077 3,935

Total expenditures 105,413 105,413 105,412 1

Excess (deficiency) of revenuesover expenditures 54,587 54,587 143,282 88,695

Net change in fund balance 54,587 54,587 143,282 88,695

Fund balances — beginning (2,554,972) (2,554,972) (2,565,989) (11,017)

Fund balances — ending $ (2,500,385) (2,500,385) (2,422,707) 77,678

See accompanying independent auditors’ report.

117

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — State Turn Back Revenue Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Intergovernmental $ 312,000 312,000 241,742 (70,258)

Total revenues 312,000 312,000 241,742 (70,258)

Expenditures:Community development 275,500 275,500 228,665 46,835

Total expenditures 275,500 275,500 228,665 46,835

Excess of revenues overexpenditures 36,500 36,500 13,077 (23,423)

Net change in fund balance 36,500 36,500 13,077 (23,423)

Fund balances — beginning 8,536 8,536 27,265 18,729

Fund balances — ending $ 45,036 45,036 40,342 (4,694)

See accompanying independent auditors’ report.

118

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Keno/Lottery Reserve Fund .

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Investment income S 95,000 95,000 35,778 (59,222)

Total revenues 95,000 95,000 35,778 (59,222)

Expenditures:Culture and parks 100,000 100,000 100,000

______________

Total expenditures 100,000 100,000 100,000 —

Excess of revenues overexpenditures (5,000) (5,000) (64,222) (59,222)

Net change in fund balance (5,000) (5,000) (64,222) (59,222)

Fund balances — beginning 3,366,741 3,366,741 3,395,798 (29,057)

Fundbalances—ending $ 3,361,741 3,361,741 3,331,576 (30,165)

See accompanying independent auditors’ report.

119

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Greater Omaha Convention and Visitors Bureau Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Taxes business $ 650,500 650,500 688,822 38,322Intergovernmental 2,300,000 2,300,000 3,479,164 1,179,164Charges for services 40,000 40,000 153,614 113,614Rents and royalties 20,000 20,000 34,650 14,650

Total revenues 3,010,500 3,010,500 4,356,250 1,345,750

Expenditures:General government 61,862 61,862 61,862Community development 3,113,445 3,113,445 3,274,780 (161,335)

Total expenditures 3,175,307 3,175,307 3,336,642 (161,335)

Excess (deficiency) of revenuesover expenditures (164,807) (164,807) 1,019,608 1,184,415

Net change in fund balance (164,807) (164,807) 1,019,608 1,184,415

Fundbalances—beginning 956,839 956,839 665,600 (291,239)

Fund balances—ending $ 792,032 792,032 1,685,208 893,176

See accompanying independent auditors’ report.

120

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Household Chemical Disposal Fund —

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Intergovernmental $ 277,000 277,000 53,213 (223,787)Rents and royalties — — 256 256Contributions and grants 50,000 50,000 385,029 335,029

Total revenues 327,000 327,000 438,498 111,498

Expenditures:Other public services 448,393 448,393 376,597 71,796

Total expenditures 448,393 448,393 376,597 71,796

DeOciency of revenuesover expenditures (121,393) (121,393) 61,901 183,294

Net change in fund balance (121,393) (121,393) 61,901 183,294

Fund balances — beginning (17,675) (17,675) (138,961) 121,286

Fundbalances—ending $ (139,068) (139,068) (77,060) 62,008

See accompanying independent auditors’ report.

121

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NONMAJOR DEBT SERVICE FUNDS

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CITY OF OMAHA, NEBRASKA

Nonmajor Governmental Funds

Debt Service Fund

The Debt Service Funds are used to account for the resources for, and the payment of, general long-term debtprincipal, interest, and related costs.

Riverfront Redevelopment Special Tax Fund — To accumulate revenues and pay bond and interest obligationson Redevelopment Bonds. The property tax levy for 2006, 2007, 2008, and 2009 is 0.894 cents per $100 oftaxable valuation. It was increased to 1.594 cents per $100 of taxable valuation in 2010 and is the same through2012.

This Redevelopment Debt Service Fund services the following issuances:

Name Date of issue Date retired

Downtown Redevelopment 1999 20192002 Redevelopment (Stockyards & Downtown) 2002 20322002 Special Obligation (Riverfront) 2002 20322004 Performing Arts Redevelopment 2004 2024Special Tax Revenue Redevelopment 2007 2027Special Tax & Tax Allocation Revenue Redevelopment A 2007 20162008 Special Obligation (Riverfront) 2008 2013Riverfront Redevelopment Refunds Series 2008A 2008 2026Special Tax Revenue Redevelopment 2008 2028Special Tax Revenue Redevelopment 2009 2012Special Tax Revenue Redevelopment 2009 2029

These bonds are serviced by a variety of revenues sources including Property Tax Revenue, Tax AllocationRevenue, State Cigarette Tax, NRD Miller Park Contribution, Douglas County Miller Park Contribution, CenturyLink naming rights, and land sales.

122

CITY OF OMAHA, NEBRASKA

Balance Sheet

Nonmajor Debt Service Fund — Riverfront Redevelopment Special Tax Fund

December 31, 2012

Riverfrontredevelopment

specialAssets tax

Cash and pooled investments $ 3,387,083Receivables (net of allowance for uncollectibles) 7,385,023Due from other governments 387,060

Totalassets $ 11,159,166

Liabilities and Fund Balances

Liabilities:Accounts payable and other current liabilities $ 11,946Unearned revenue 1,421Advance revenue 7,346,109

Total liabilities 7,359,476

Fund balances:Restricted 3,799,690

Total fund balance 3,799,690

Total liabilities and fund balance $ 11,159,166

See accompanying independent auditors’ report.

123

CITY OF OMAHA, NEBRASKA

Statement of Revenues, Expenditures, and Changes in Fund Balances

Nonmaj or Debt Service Fund — Riverfront Redevelopment Special Tax Fund

Year ended December 31, 2012

Riverfrontredevelopment

specialtax

Revenues:Taxes:

Property $ 6,260,102In lieu 16,218

Intergovernmental 1,500,000Investment income 26,813Rents, royalties, and other 825,000Contributions and grants 267,9 1 1

Total revenues 8,896,044

Expenditures:Current:

General government 54,428Debt service:

Principal 3,985,264Interest 5,323,955Bond issuance costs 420,835

Total expenditures 9,784,482

Other financing sources:Proceeds from the issuance of bonds 11,785,000Proceeds of refunding bonds 35,067,065Proceeds from bond premium 1,815,011Payment to refunded bond escrow agent (47,877,188)

Total other financing sources 789,888

Net change in fund balances (98,550)

Beginning fund balance 3,898,240

Ending fund balance $ 3,799,690

See accompanying independent auditors’ report.

124

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Debt Service Fund

Year ended December 31, 2012

(Unaudited)

Revenues:Taxes propertyTaxes in lieuIntergovernmentalInvestment incomeCharges for servicesContributions and grants

Total revenues

Expenditures:General governmentDebt service:PrincipalinterestBond issuance costs

Total expenditures

Excess (deficiency) of revenuesover expenditures

Other financing sources (uses):Proceeds from issuance of bondsProceeds from bond premiumPayment to refunded bond escrow agent

Total other financing sources

Net change in fund balance

Fund balances — beginning

Fund balances — ending

S 53,219,37481,334

200,0002,157,5843,019,349

58,677,641

694,766

37,532,33323,850,886

62,077,985

(3,400,344)

Final Actual

53,660,317196,169

2,175,678966,136

2,633,4242,414,956

62,046,680

694,766 738,724

38,180,61423,226,637

480,275

62,626,250

(3,400,344) (579,570)

35,335,0004,306,871

(38,968,646)

_______________

673,225

(3,400,344) 93,655

Variance withfinal budget

positive(negative)

440,943114,835

2,175,678766,136475,840

(604,393)

3,369,039

(43,958)

(648,281)624,249

(480,275)

(548,265)

2,820,774

35,335,0004,306,871

(38,968,646)

673,225

3,493,999

See accompanying independent auditors’ report.

Budgeted amountsOriginal

53,219,37481,334

200,0002,157,5843,019,349

58,677,641

37,532,33323,850,886

62,077,985

(3,400,344)

16,746,784 16,746,784 18,595,398 1,848,614

$ 13,346,440 13,346,440 18,689,053 5,342,613

125

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Riverfront Redevelopment Special Tax Fund

Year ended December 31, 2012

(Unaudited)

Revenues:Taxes propertyTaxes in lieuIntergovernmentalInvestment incomeRents, royalties, and otherContributions and grants

Total revenues

Expenditures:General governmentDebt service principalDebt service interestDebt service bond issuance costs

Total expenditures

Deficiency of revenues overexpenditures

Other financing sources (uses):Proceeds from issuance of bondsProceeds of refunding bondsProceeds from bond premiumPayment to refunded bond escrow agent

Total other financing sources

Net change in fund balance

Fund balances — beginning

Fund balances — ending

S 6,420,7196,724

1,500,000

825,000287,230

9,039,673

58,9503,835,2645,610,594

9,504,808

(465,135)

Final Actual

6,260,10216,218

1,500,00026,813

825,000

_____________

267,911

9,039,673 8,896,044

54,4283,985,2645,323,955

______________

420,835

_______________

9,784,482

(465,135) (888,438)

11,785,00035,067,065

1,815,011(47,877,188)

_______________

789,888

(465,135) (98,550)

Variance withfinal budget

positive(negative)

(160,617)9,494

26,813

(19,319)

(143,629)

4,522(150,000)286,639

(420,835)

(279,674)

(423,303)

11,785,00035,067,065

1,815,011(47,877,188)

789,888

366,585

See accompanying independent auditors’ report.

Budgeted amountsOriginal

6,420,7196,724

1,500,000

825,000287,230

58,9503,835,2645,610,594

9,504,808

(465,135)

3,119,507 3,119,507 3,898,240 (778,733)

S 2,654,372 2,654,372 3,799,690 1,145,318

126

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NONMAJOR CAPITAL PROJECT FUNDS

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CITY OF OMAHA, NEBRASKA

Nonmajor Governmental Funds

Capital Project Funds

The Capital Projects Funds are used to account for and report financial resources that are restricted, committed,or assigned to expenditure for capital outlays, including the acquisition or construction of capital facilities andother capital facilities and other capital assets. Capital projects funds exclude those types of capital relatedoutflows financed by proprietary funds or for assets that will be held in trust for individuals, privateorganizations, or other governments.

ASARCO/Lewis and Clark Remediation Fund — To develop initial public improvements associated with theconversion of the ASARCO property to a public recreational area, along with other improvements along theriverfront. Improvements will include trails, benches, landscaping, roads, parking lots, and similar publicdevelopments. In addition, the agreement requires ASARCO to deposit $1.5 million to be invested by the City tofund long-term remediation costs.

Advanced Acquisition Fund — To account for net proceeds from the sale or exchange of real property. The netproceeds from the sale or exchange of real property not needed for public purposes are to be credited to this find.Section 5.03 of the Municipal Code permits usage of available funds to facilitate the orderly and timelyacquisition of real estate for public purposes as proposed in the master plan.

City Capital Improvement Fund — To account for money supplemented by General Fund appropriations andgrants used to fund various city projects.

2006 Environmental Bond Fund — To account for money received through the issuance of a general obligationbond voted on in the May 2006 primary election. Proceeds from the sale of the bond are used toward the cost ofconstmction and improvement of storm, sanitary, and interceptor sewers throughout the City.

2010 Environmental Bond Fund — To account for money received through the issuance of a general obligationbond voted on in the May 2010 primary election. Proceeds from the sale of the bond are used toward the cost ofconstmction and improvement of storm, sanitary, and interceptor sewers throughout the City.

Airport Business Park Development Fund — To account for contributions received from developers whorequest Tax Increment Financing throughout the Downtown Northeast area. This requirement is incorporated inthe Redevelopment Agreement between the City of Omaha and the developer when sewer connections arerequired within the Airport Industrial Park and/or East Omaha Detention Cells. All sewer connection fees withinthis area are paid by this fund. Other funding is provided by TIF proceeds and the sale of land.

2006 Transportation Bond Fund — To account for money received through the issuance of general obligationbonds in the May 2006 primary elections. Proceeds from the sale of these bonds are used toward the cost ofconstruction and improvement of streets, expressways, freeways, and various bridge improvements throughoutthe City.

2010 Transportation Bond Fund — To account for money received through the issuance of general obligationbonds in the May 2010 primary elections. Proceeds from the sale of these bonds are used toward the cost ofconstruction and improvement of streets, expressways, freeways, and various bridge improvements throughoutthe City.

127 (Continued)

CITY OF OMAHA, NEBRASKA

Nonmajor Governmental Funds3”.

Capital Project Funds

2006 Public Facilities Bond Fund — To account for the construction of projects funded with proceeds from the2006 Public Facility Bond Authorization. The Bond Authorization amount is $16,410,000.

2010 Public Facilities Bond Fund — To account for the construction of projects funded with proceeds from the2010 Public Facility Bond Authorization. The Bond Authorization amount is $8,025,000.

2006 Public Safety Bond Fund — To account for money received through the issuance of general obligationbonds in the May 2006 primary election. Proceeds from the sale of these bonds will be used for various publicsafety capital expenditures, including the purchase of aerials, pumpers, and emergency vehicle preemptionsystem equipment.

2010 Public Safety Bond Fund — To account for money received through the issuance of general obligationbonds in the May 2010 primary election. Proceeds from the sale of these bonds will be used for various publicsafety capital expenditures, including the purchase of aerials, pumpers, and emergency vehicle preemptionsystem equipment.

2000 Park and Recreation Bond 2002 #1 Fund — To account for this Capital Project fund, which was createddue to the November, 2000 Primary Election, the voters authorized the issuance of $10,500,000 of GeneralObligation Bonds. Various smaller projects remain and should complete in 2009 to expend this fund fully.

2006 Parks and Recreation Bond Fund — To account for the City of Omaha 2006 Bond issue. The City ofOmaha citizens voted and approved, in the spring of 2006, to issue $16,930,000 in General Obligation bonds.This money will be used for development and rehabilitation of City of Omaha Parks, and Recreations Centers.

2010 Parks and Recreation Bond Fund — To account for the City of Omaha 2010 Bond issue. The City ofOmaha citizens voted and approved on May 11, 2010 to issuance of $14,410,000 in General Obligation bonds.This money will be used for development and rehabilitation of City of Omaha Parks and Recreations Centers.

Downtown Stadium & Companion Project — To account for the construction of a new City baseball stadium tobe built between 10th and 13th Streets between Cuming and Webster Streets. The City of Omaha FacilitiesCorporation will issue lease purchase bonds to provide funding. On June 10, 2008, the Omaha City Counciladopted Ordinance 38124 approving the Sixth Amendment to the Agreement and Lease regarding the OmahaConvention Center/Arena between the City and MECA (Metropolitan Entertainment & Convention Authority) toprovide for the construction and operation.

Pedestrian Trail Bridge — Joint Use Omaha/Council Bluffs Fund — To account for moneys spent toward theoperation and maintenance of the Missouri River Pedestrian Bridge. Funds received in this fund may be usedtoward inspection, operation and maintenance costs of the crossing bridge.

Missouri River Pedestrian Bridge Fund — To account for the costs associated with the construction of theMissouri River Pedestrian Bridge.

Back to the River Project Fund — To track expenditures associated with the Riverfront Trail — North/NorthOmaha Connector Grant. The City of Omaha received this grant from the Nebraska Department of Roads toconstruct two major trails, the riverfront trail from ASARCO north to NP Dodge Park and the North OmahaConnector, which will connect this to the Keystone Trail.

128 (Continued)

CITY OF OMAHA, NEBRASKA

Nonmajor Governmental Funds

Capital Project Funds

UNMC Infrastructure Improvements Fund — To account for the redevelopment of 42nd Street within theUniversity of Nebraska Medical Center campus. The fund will provide for fully reimbursable expenditures forstreet and other infrastructure development to the site. The project entails a reduction from 4 to 2 lanes of throughtraffic creating a pedestrian friendly streetscape. The project has been expanded to include the study of therelocation of Saddle Creek Road to the west permitting development of the previous roadbed into an urbancampus.

Downtown Development Fund — To account for the redevelopment of the site known as Pinnacle Foods locatedacross 10th Street from the Qwest Center. The fund represents the City’s exercise of its “right of first refusal” toacquire this prime development property.

Library Facilities Capital Fund — To pay off yearly bond obligations for capital projects to improve facilities ofthe Omaha Public Library. Phase II of this project would include purchase of land in west central, southwest, andnorthwest Omaha areas. Other projects include the renovation of W. Dale Clark Library, Swanson Branch, andAbrahams Branch.

Capital Special Assessment Fund — To account for Public Works assessments for sidewalks and sewer repairsdone by the City. This is assessed annually for the homeowner with outstanding bills. S.I.D.’s are also billed forstreet and sewer repairs.

Service Special Assessment Fund — To account for a Parks and Recreation fund to enforce the city codes forweeds, litter, and demolition of buildings. This is assessed annually for the homeowner with outstanding bills.

129

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35

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Advanced Acquisition Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:$

______ ______

Total revenues

Expenditures:Community development 92,242 (92,242)Capital outlay 1,900,000 1,900,000 857,103 1,042,897

Total expenditures 1,900,000 1,900,000 949,345 950,655

Deficiency of revenues underexpenditures (1,900,000) (1,900,000) (949,345) 950,655

Other financing sources:Sale of capital assets 658,000 658,000

Total other financing sources — — 658,000 658,000

Net change in fund balance (1,900,000) (1,900,000) (291,345) 1,608,655

Fund balances — beginning 2,693,657 2,693,657 3,142,039 448,382

Fund balances — ending $ 793,657 793,657 2,850,694 2,057,037

See accompanying independent auditors’ report.

136

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule —2010 Enviromnental Bond Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Contributions and grants $ — — 49,163 49,163

Total revenues — — 49,163 49,163

Expenditures:Capital outlay 3,480,000 3,480,000 208,578 3,271,422

Total expenditures 3,480,000 3,480,000 208,578 3,271,422

Deficiency of revenues underexpenditures (3,480,000) (3,480,000) (159,415) 3,320,585

Other financing sources:Proceeds from issuance of bonds 3,480,000 3,480,000 2,040,000 (1,440,000)Proceeds from bond premium — — 110,000 110,000

Total other financing sources 3,480,000 3,480,000 2,150,000 (1,330,000)

Net change in fund balance — — 1,990,585 1,990,585

Fund balances — beginning

_______________ _______________ _______________

Fund balances — ending $ — 1,990,585 1,990,585

See accompanying independent auditors’ report.

137

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule —2006 Transportation Bond Fund

Year ended December 31, 2012

(Unaudited)

See accompanying independent auditors’ report.

Budgeted amountsOriginal Final

SRevenues:

Contributions and grants

Total revenues

Expenditures:Capital outlay

Total expenditures

Deficiency of revenues underexpenditures

Other financing sources (uses):Proceeds from issuance of bonds

Total other financing sources

Net change in fund balance

Fund balances — beginning

Fund balances — ending

4,714,000

4,714,000

(4,714,000)

4,714,000

4,714,000

4,714,000

4,714,000

(4,714,000)

4,714,000

4,714,000

Actual

1,464,859

1,464,859

9,842,769

9,842,769

(8,377,910)

8,966,000

8,966,000

588,090

3,224,023

3,812,113

Variance withfinal budget

positive(negative)

1,464,859

1,464,859

(5,128,769)

(5,128,769)

(3,663,910)

4,252,000

4,252,000

588,090

3,224,023

3,812,113$ —

138

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule —2010 Transportation Bond Fund

Year ended December 31, 2012

(Unaudited)

See accompanying independent auditors’ report.

139

S

Budgeted amountsOriginal Final Actual

248,195

248,195

Variance withfinal budget

positive(negative)

248,195

248,195

Revenues:Contributions and grants

Total revenues

Expenditures:Capital outlay

Total expenditures

Deficiency of revenues underexpenditures

Other financing sources (uses):Proceeds from issuance of bondsProceeds from bond premiumTransfers inTransfers out

Total other financing sources

Net change in fund balance

Fund balances — beginning

Fund balances — ending

7,326,000 7,326,000 2,595,754 4,730,246

7,326,000 7,326,000 2,595,754 4,730,246

(7,326,000) (7,326,000) (2,347,559) 4,978,441

7,326,000 7,326,000 2,494,000 (4,832,000)—

— 540,000 540,000— 903 903

—

— (585,660) (585,660)

7,326,000 7,326,000 2,449,243 (4,876,757)

—

— 101,684 101,684

$ — 101,684 101,684

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule —2006 Public Facilities Bond Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:$

______ ______ ______ ______

Total revenues — — —

Expenditures:Capital outlay 183,000 183,000 733,859 (550,859)Culture and parks — — 25,725 (25,725)

Total expenditures 183,000 183,000 759,584 (576,584)

Deficiency of revenues underexpenditures (183,000) (183,000) (759,584) (576,584)

Other financing sources:Proceeds from issuance of bonds 183,000 183,000 1,340,000 1,157,000

Total other financing sources 183,000 183,000 1,340,000 1,157,000

Net change in fund balance — — 580,416 580,416

Fund balances — beginning —.— 552,291 552,291

Fund balances— ending $ — — 1,132,707 1,132,707

See accompanying independent auditors’ report.

140

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule —2010 Public Facilities Bond Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Contributions and grants S

_______________ _______________

75,000 75,000

Total revenues — — 75,000 75,000

Expenditures:Capital outlay 3,492,000 3,492,000 845,171 2,646,829Community development 3,044 (3,044)Culture and parks — — 4,718 (4,718)

Total expenditures 3,492,000 3,492,000 852,933 2,639,067

Deficiency of revenues underexpenditures (3,492,000) (3,492,000) (777,933) 2,714,067

Other financing sources:Proceeds from issuance of bonds 3,492,000 3,492,000 2,000,000 (1,492,000)Proceeds from bond premium

_______________

— 260,000 260,000

Total other financing sources 3,492,000 3,492,000 2,260,000 (1,232,000)

Net change in fund balance — — 1,482,067 1,482,067

Fund balances — beginning — — (97,487) (97,487)

Fund balances—ending $ — — 1,384,580 1,384,580

See accompanying independent auditors’ report.

141

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — 2006 Public Safety Bond Fund

Year ended December 3 1, 20 12

(Unaudited)

Revenues:

Budgeted amountsOriginal Final Actual

Variance withfinal budget

positive(negative)

Expenditures:Capital outlay

See accompanying independent auditors’ report.

142

298,066

298,066

298,066

92,000

92,000

390,066

(55,509)

334,557

Total revenues

$

1,068,000 1,068,000 769,934

Total expenditures 1,068,000 1,068,000 769,934

Deficiency of revenues underexpenditures (1,068,000) (1,068,000) (769,934)

Other financing sources (uses):Proceeds from issuance of bonds 1,068,000 1,068,000 1,160,000

Total other financing sources (uses) 1,068,000 1,068,000 1,160,000

Net change in fund balance — 390,066

Fund balances — beginning (55,509)

Fund balances — ending $ —- 334,557

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — 2010 Public Safety Bond Fund

Year ended December 31, 2012

(Unaudited)

See accompanying independent auditors’ report.

143

Variance withfinal budget

positive(negative)

8,676

8,676

8,676

(142,000)405,000

263,000

271,676

271,676

Budgeted amountsOriginal Final Actual

Revenues:S —

Total revenues — —

Expenditures:Capital outlay 177,000 177,000 168,324

Total expenditures 177,000 177,000 168,324

Deficiency of revenues underexpenditures (177,000) (177,000) (168,324)

Other financing sources (uses):Proceeds from issuance of bonds 177,000 177,000 35,000Proceeds from bond premium — — 405,000

Total other financing sources (uses) 177,000 177,000 440,000

Net change in fund balance — — 271,676

Fund balances — beginning — —

Fund balances — ending S — — 271,676

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — 2006 Parks and Recreation Bond Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Contributions and grants $ — — 1,783,768 1,783,768

Total revenues — — 1,783,768 1,783,768

Expenditures:Capital outlay 670,000 670,000 2,506,034 (1,836,034)

Total expenditures 670,000 670,000 2,506,034 (1,836,034)

Deficiency of revenues underexpenditures (670,000) (670,000) (722,266) (52,266)

Other financing sources:Proceeds from issuance of bonds 670,000 670,000 1,130,000 460,000Transfers in — 575 575

Total other financing sources 670,000 670,000 1,130,575 460,575

Net change in fund balance — — 408,309 408,309

Fund balances — beginning — — 707,845 707,845

Fund balances— ending $ —— 1,116,154 1,116,154

See accompanying independent auditors’ report.

144

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule —2010 Parks and Recreation Bond Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Contributions and grants $ —

_______________

1,392,236 1,392,236

Total revenues — 1,392,236 1,392,236

Expenditures:Capital outlay 3,077,000 3,077,000 2,915,271 161,729

Total expenditures 3,077,000 3,077,000 2,915,271 161,729

Deficiency of revenues underexpenditures (3,077,000) (3,077,000) (1,523,035) 1,553,965

Other financing sources:Proceeds from issuance of bonds 3,077,000 3,077,000 4,360,000 1,283,000Proceeds from bond premium — — 310,000 310,000

Total other financing sources 3,077,000 3,077,000 4,670,000 1,593,000

Net change in fund balance — — 3,146,965 3,146,965

Fund balances — beginning — — (747,423) (747,423)

Fund balances — ending $ — — 2,399,542 2,399,542

See accompanying independent auditors’ report.

145

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Downtown Stadium and Companion Projects Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues;Charges for services $ 1,127,441 1,127,441Contributions and grants 7,000,000 7,000,000 7,000,000 —

Total revenues 7,000,000 7,000,000 8,127,441 1,127,441

Expenditures:Debt Service:

Principal 34,366 (34,366)Interest 93,054 (93,054)

Capital outlay 1,768,688 (1,768,688)

Total expenditures 1,896,108 (1,896,108)

Excess (deficiency) of revenuesover (under) expenditures 7,000,000 7,000,000 6,231,333 (768,667)

Other financing sources (uses):Proceeds from issuance of bonds 1,094,862 1,094,862

Total other financing sources (uses) — — 1,094,862 1,094,862

Net change in fund balance 7,000,000 7,000,000 7,326,195 326,195

Fund balances—beginning (18,000,000) (18,000,000) (17,457,117) 542,883

Fund balances — ending $ (11,000,000) (11,000,000) (10,130,922) 869,078

See accompanying independent auditors’ report.

146

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Pedestrian Trail Bridge-Joint Use

Year ended December., 1, 2012 -

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Contributions and grants $ 200,000 200,000 100,000 (100,000)

Total revenues 200,000 200,000 100,000 (100,000)

Expenditures:Culture and parks 86,873 86,873 228,148 (141,275)Capital outlay —

______________

140,084 (140,084)

Total expenditures 86,873 86,873 368,232 (281,359)

Deficiency of revenues underexpenditures 113,127 113,127 (268,232) (381,359)

Other financing sources:Transfers in 100,000 100,000

Total other financing sources — — 100,000 100,000

Net change in fund balance 113,127 113,127 (168,232) (281,359)

Fund balances—beginning 309,548 309,548 355,661 46,113

Fund balances — ending S 422,675 422,675 187,429 (235,246)

See accompanying independent auditors’ report.

147

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Special Assessment Fuids

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Investment income $ 144,000 144,000 311,160 167,160Charges for services 770,000 770,000 163,025 (606,975)Rents and royalties — — 193 193Contributions and grants — — 1,306,986 1,306,986

Total revenues 914,000 914,000 1,781,364 867,364

Expenditures:General government 30,000 30,000 27,976 2,024Transportation services 885.000 885,000 70,000 815,000Culture and parks 25,100 25,100 25,100Debt service:

Principal 536,000 (536,000)Interest 10,883 (10,883)

Capital outlay 1,564,289 (1,564,289)

Total expenditures 940,100 940,100 2,234,248 (1,294,148)

Deficiency of revenues underexpenditures (26,100) (26,100) (452,884) (426,784)

Other financing sources (uses):Transfers in 228,000 228,000 (228,000)Transfers Out (228,000) (228,000) 228,000Proceeds from issuance of bonds — — 536,000 536,000

Total other financing sources — — 536,000 536,000

Net change in fund balance (26,100) (26,100) 83,116 109,216

Fund balances—beginning 98,618 98,618 682,963 584,345

Fund balances — ending S 72,518 72,518 766,079 693,561

See accompanying independent auditors’ report.

148

NONMAJOR PERMANENT FUNDS

This page intentionally left blank

CITY OF OMAHA, NEBRASKA

Nonmajor Governmental Funds :Permanent Funds

Permanent funds are used to report resources that are legally restricted to the extent that only earnings, notprincipal, may be used for purposes that support the reporting government’s programs.

Western Heritage Special Revenue Fund — To account for a Permanent Endowment fund established inaccordance with City Ordinance #33472 passed January 31, 1995, whereby the City will contribute moneystoward the renovation and construction at the Western Heritage Museum. These funds were realized from thesale of a portion of the Byron Reed coin and manuscript collection held in October 1996.

Endowment for Library Fund — To account for funds that are donated to the Public Library from outsidesources. This is a permanent fund for endowment gifts. Tn 1974, Don L. Hayes bequeathed to the Public Librarya permanent memorial endowment with interest to be used to purchase books in honor of his parents. In 1979,Ralph Anderson bequeathed an endowment to the library with interest to be used to benefit the library. Annualinterest from these accounts is used to enhance the library’s collections and operations.

149

CITY OF OMAHA, NEBRASKA

Combining Balance Sheet

Nonmaj or Permanent Funds

December 31, 2012

TotalWestern Endowment Permanent

Assets Heritage for Library Funds

Cash and pooled investments $ 93,467 3,892 97,359Investments 3,005,904 59,171 3,065,075Accrued interest 16,700 193 16,893

Total assets $ 3,116,071 63,256 3,179,327

Liabilities and Fund Balances

Liabilities:Accounts payable and other current liabilities $

________________

Total liabilities

Fund balances:Nonspendable 2,717,918 57,471 2,775,389Committed 398,153 5,785 403,938

Total fund balance 3,1 16,071 63,256 3,179,327

Total liabilities and fund balance $ 3,116,071 63,256 3,179,327

See accompanying independent auditors’ report.

150

CITY OF OMAHA, NEBRASKA

Combining Statement of Revenues, Expenditures, and Changes in Fund Balances

Nonmaj or Permanent Funds

Year ended December 31, 2012

Revenues:Investment income

Total revenues

Expenditures:Current:

Culture and parks

Total expenditures

Other financing sources (uses):Transfers inTransfers out

Total other financing sources

Net change in fund balance

Beginning fund balance

Ending fund balance

WesternHeritage

S 82,509

82,509

73,750

73,750

8,759

3,107,312

S 3,116,071

Endowmentfor Library

607

607

607

62,649

63,256

TotalPermanent

Funds

83,116

83,116

73,750

73,750

9,366

3,169,961

3,179,327

See accompanying independent auditors’ report.

151

CITY OF OMAHA, NEBRASKA

Budgetary Comparison Schedule — Western Heritage Permanent Fund

Year ended December 31, 2012

(Unaudited)

Variance withfinal budget

Budgeted amounts positiveOriginal Final Actual (negative)

Revenues:Investment income $ 87,000 87,000 82,509 (4,491)

Total revenues 87,000 87,000 82,509 (4,491)

Expenditures:Culture and parks 87,000 87,000 73,750 13,250

Total expenditures 87,000 87,000 73,750 13,250

Deficiency of revenuesunder expenditures — — 8,759 8,759

Net change in fund balance — — 8,759 8,759

Fund balances — beginning 31,141,918 31,141,918 3,107,312 (28,034,606)

Fund balances—ending $ 31,141,918 31,141,918 3,116,071 (28,025,847)

See accompanying independent auditors’ report.

152

ENTERPRISE FUNDS

This page intentionally left blank

CITY OF OMAHA, NEBRASKA

Enterprise Funds

The Enterprise Funds account for operations that are financed and operated in a manner similar to privatebusiness enterprises: (a) where the intent of the governing body is that the costs of providing goods or services tothe general public on a continuing basis is financed or recovered primarily through user charges or (b) where thegoverning body has decided that periodic determination of revenues earned, expenses incurred, andJor netincome is appropriate for capital maintenance, public policy, management control, accountability, or otherpurposes.

City Wide Sports Revenue Fund — To account for the moneys received from adult leagues operated by theParks, Recreation, and Public Property Department. Currently, leagues are formed for football, volleyball, andbasketball competition. The fund is self-supported through registration fees charged to participants.

Marinas Fund — To account for activities at the N.P. Dodge Park Marina, the Riverfront Marina, andCunningham Lake Marina. This Enterprise Fund accounts for receipts generated through the leasing of boat stallsat the N.P. Dodge Park Marina.

Dodge Park Marina Dredge Fund — To account for the accumulated reserves for the replacement of the RiverDredge. The Dodge Park Marina Dredge Fund is a special revenue fund created to take care of any contingencies(repairs, etc.) that occur with the dredge. Each year, $4,000 is transferred from the Dodge Park Marina fund tothis fund.

Tennis Operations Fund — To account for the Tennis operations at the City of Omaha Tennis courts. Thisenterprise fund provides for the operation of one 8-court indoor tennis center, one 15-court tennis center, andnumerous neighborhood tennis courts located throughout the City.

Golf Operations Fund — To account for the Golf operations and concessions at the City of Omaha Golf Courses.This enterprise fund was created in 1993 to form a self-supporting enterprise fund for the operations at allMunicipal Golf Courses, which includes maintenance of the City’s four 18-hole golf courses and five 9-hole golfcourses and to fund necessary capital improvements.

Air Quality Fund — To account for the Title V federal funding and the applicable City ordinance authorizedfees. These funds provide the City the necessary resources to monitor the air quality and enforce the health andenvironmental laws relating to clean air.

Compost Fund — To account for the contract between the City of Omaha and the Quality Control Division of theCity of Omaha to operate the compost facility located adjacent to the Papillion Creek Wastewater TreatmentPlant.

Printing Services and Graphics Fund — To account for the charges for printing services for the various Cityand Douglas County departments, agencies, and grant fund projects.

Riverfront Plaza and Marina Fund — To account for the activity at Lewis and Clark landing on the City ofOmaha’s Missouri Riverfront. The plaza is available for private groups to rent.

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156

PENSION TRUST FUNDS

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CITY OF OMAHA, NEBRASKA

Pension Trust Funds IiI1IThe Pension Trust Funds are used to account for assets held by the City in a trustee capacity.

Civilian Retirement Fund — To account for resources that are held in trust for the members and beneficiaries ofthe full-time Civilian employees of the City of Omaha.

Police/Fire Retirement Reserve Fund — To account for resources that are held in trust for the members andbeneficiaries of the Police and Fire Sworn full-time employees of the City of Omaha.

157

CITY OF OMAHA, NEBRASKA

Combining Statement of Fiduciary Net Position

Pension Trust Funds

December 31, 2012

Civilian Police/Fire TotalRetirement Retirement Pension

Assets Fund Reserve Fund Trust

Cash and cash equivalents $ 984 812,242 813,226Receivables:

Accounts receivable 312,293 1,501,122 1,813,415Accrued interest 318,835 1,749,160 2,067,995

Due from other governments 1,089 1,089Investments, at fair value:

Government securities 20,278,557 17,033,908 37,312,465Municipal issues 1,409,593 2,469,565 3,879,158Corporate bonds 21,076,921 96,448,882 117,525,803Domestic equities 67,886,568 159,295,250 227,181,818International equities 36,006,318 89,163,872 125,170,190Domestic real estate securities 36,980,630 96,127,044 133,107,674International real estate 1,503,535 1,503,535Commodities 22,342,786 11,150,579 33,493,365Private equity 12,059,269 — 12,059,269Cash and cash equivalents 6,200,110 13,308,611 19,508,721

Total assets $ 224,873,953 490,563,770 715,437,723

Liabilities and Net Position

Accounts payable and other current liabilities $ 1,640,865 763,631 2,404,496

Total liabilities 1,640,865 763,631 2,404,496

Held in trust for pension benefits 223,233,088 489,800,139 713,033,227

Total liabilities and net position $ 224,873,953 490,563,770 715,437,723

See accompanying independent auditors’ report.

158

CITY OF OMAHA, NEBRASKA

Combining Statement of Changes in Fiduciary Net Position

Pension Trust Funds

Year ended December 3 1, 2012

Civilian Police/Fire TotalRetirement Retirement Pension

Fund Reserve Fund Trust

Additions:Contributions:

Employer $ 7,216,050 35,302,037 42,518,087Employee 6,201,923 19,641,660 25,843,583

Total contributions 13,417,973 54,943,697 68,361,670

Investment income:Dividends and interest 6,075,554 14,928,954 21,004,508Net appreciation in fair value of investments 18,454,403 42,603,277 61,057,680

Total investment earnings 24,529,957 57,532,231 82,062,188

Investment expenses (1,364,199) (2,489,092) (3,853,291)

Net investment income 23,165,758 55,043,139 78,208,897

Total additions 36,583,731 109,986,836 146,570,567

Deductions:Benefit payments 28,785,427 60,616,088 89,401,515

Change in net position 7,798,304 49,370,748 57,169,052

Net position held in trust for pension benefits,beginning of year 215,434,784 440,429,391 655,864,175

Net position held in trust for pension benefits,end of year $ 223,233,088 489,800,139 713,033,227

See accompanying independent auditors’ report.

159

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AGENCY FUNDS

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CITY OF OMAHA, NEBRASKA

Agency Funds

The Agency Funds account for assets held by the City as an agent for various local governments.

RID #126 First National Bank Tower Fund — To account for the tax increment financing revenues collected inregard to the First National Bank Tower TIE project.

RID #132 ConAgra Campus and Parking Fund — To account for the tax increment financing revenuescollected with regard to the ConAgra Campus/Parking TIF project. Property taxes from the increased propertyvalue are collected and used to pay off the TIE debt service requirements.

TIF Bond Debt Service Fund — To account for the tax increment financing revenues collected in regards to theConvention Center Hotel TIF project and account for the debt service reserve required by the issuance of bonds.

TIF Redevelopment Projects Fund — To comply with the Community Development Law of the State ofNebraska (Chapter 18, Article 21, Sections 18-2101) as supplemented and including Sections 18-2147 to18-2153, Reissue Revised Statutes of Nebraska, 1943, as amended. This fiduciary fund is required in accordancewith Section 18-2147 to establish separate funds into which Excess Tax Revenues (provided from special taxprovisions) from the Redevelopment site shall be paid and from which the principal and interest of theRedevelopment Note shall be paid.

RiD #122 First National Child Care Facility - To account for the tax increment financing revenues collected inregards to the First National Bank Day Care TIF project. These funds will be remitted to First National uponrequest.

RID #77 Hammons/Embassy Suites Fund — To account for the tax increment financing revenues collected inregards to the ConAgra Embassy Suites Hotel TIP project.

R/D #87 Aksarben Business and Education Campus Fund — To account for the tax increment financingrevenues collected in regards to the Aksarben Business Park TIP project phase I.

Appeal Bond Deposit Fund — To account for appeal application fees received from citizens whose applicationto build upon or rezone an area of land within the City limits has been denied. Fees are charged for appealapplications to defray the administrative costs incurred by the City Planning Board of Appeals.

Automobile Impounding Deposit Fund — To account for vehicles sold at auction at the police tow lot for morethan the accumulated charges against the vehicle. The amount in excess of the accumulated charges is held inescrow for two years, during which the former owner can claim the money held.

Bid Deposit Fund — To account for moneys collected from vendors based on the required amounts to place a bidwithin the City. Once the bid process is completed and bid is awarded, the bid deposits for those who did notreceive the bid are returned.

Board of Education Liquor Deposit Fund — To account for the collection of fees derived from a wholesalebeer and liquor occupation tax imposed on any person who engages in the manufacture or distribution of beer orliquors, or selling at retail of alcoholic beverages within the City limit. The tax rates are controlled by the State ofNebraska. These license fees are remitted to the Omaha Public Schools Board of Education, through the DouglasCounty Treasurer via wire transfer, on a quarterly basis.

160 (Continued)

CITY OF OMAHA, NEBRASKA

Agency Funds

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Board of Education Tobacco Deposit Fund — To account for license fees from retailers for all tobacco sales,including a separate permit fee for the operation of any machine, which upon insertion of a coin or substituteobject operates or may be operated to dispense tobacco products. These license fees are remitted to the OmahaPublic Schools Board of Education, through the Douglas County Treasurer via wire transfer, on a quarterly basis.

Humane Society Kennel Permits Fund — To account for collection of kennel permits and licenses fromcitizens. Receipts are remitted to the Humane Society on a quarterly basis.

Sales Tax Deposit Fund — To account for all sales tax receipts collected by the City, which are imposed uponsales transactions within the corporate limits of the City in accordance with the Nebraska Tax Revenue Act of1967. The State portion of the sales tax is remitted to the Nebraska Department of Revenue on a monthly basis.

After Hours Dance Deposit Fund — To account for money collected through Section 5-64 of the OmahaMunicipal Code, in which the City requires a $5,000 bond to be posted when a business is granted an after-hoursdance permit.

Board of Education Parking Fines Fund — To account for moneys collected by the City Cashier for parkingviolation fines, which are remitted to the Omaha Public Schools Board of Education through the Douglas CountyTreasurer, via wire transfer, on a quarterly basis.

Park Development Deposits Fund — To account for the receipts received for neighborhood parks to be builtwithin suburban Omaha in the future. In addition, subdivision agreements include provision for deposits to bemade to the fund at appropriate debt to value intervals.

Arterial Street Improvement Program Fund — To collect and distribute funds for the design and constructionof arterial street improvements in the unincorporated portions of Douglas County. These funds are collected onbehalf of Douglas County and are remitted on an as-requested basis to the County.

R/D #102 First National Processing Center — To account for the tax increment financing revenues collected inregards to the First National Bank Data Center TIF project.

Demolition Performance Bond Fund — To hold moneys where citizens post a deposit for the demolition ofdilapidated structures. Before the demolition fee is refunded, a visual inspection is done to insure proper cleanupof the demolition site.

Performance Bond Fund — To hold deposits received in the form of a bond or cashier’s check from vendorswhose bid was accepted to provide services, i.e., professional or construction, to the City of Omaha. Uponsatisfactory completion of the contracted services, the bond deposit is returned to the vendor. If the vendor failsto satisfactorily complete the contracted services, the bonding company is then responsible for finding anothervendor to complete the contracted services.

TJF Projects Contribution Fund — To account for the contributions received from redevelopment projects oncertain locations for the purpose of defraying costs of improvements to those locations. This special revenue fundwas created to record contributions collected on TIE projects in accordance with the existing redevelopmentagreements.

161

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64

CITY OF OMAHA, NEBRASKA

Combining Statement of Changes in Assets and Liabilities

Agency Funds

Year ended December 31, 2012

Balance, Balance,January 1, December31,

RID #126 First National Bank Tower 2012 Additions Deductions 2012

Assets:Cash and pooled investments $ 342,324 2,722,967 2,580,415 484,876

Liabilities:Accounts payable and other liabilities $ 342,324 2,580,415 2,722,967 484,876

RID #132 ConAgra Campus and Parking

Assets:Cash and pooled investments S 1,124,200 790,737 1,490,500 424,437Due from other funds — 1,216,000 — 1,216,000

$ 1,124,200 2,006,737 1,490,500 1,640,437

Liabilities:Accounts payable and other liabilities $ 1,124,200 1,000 517,237 1,640,437

TIF Bond Debt Service

Assets:Cash and pooled investments $ 660,194 2,869,620 2,590,868 938,946Investments 1,196,735 1,199,688 1,200,000 1,196,423Accrued interest — 1,325 — 1,325

$ 1,856,929 4,070,633 3,790,868 2,136,694

Liabilities:Accounts payable and other liabilities $ 1,856,929 1,500 281,265 2,136,694

TIF Redevelopment Projects

Assets:Cash and pooled investments S 709,804 37,085,274 37,557,275 237,803

Liabilities:Accounts payable and other liabilities $ 709,804 18,561,113 18,089,112 237,803

First National Child Care Facility

Assets:Cash and pooled investments S 146,801 145,801 1,000

Liabilities:Accounts payable and other liabilities $ — 77,901 78,901 1,000

RID #77 Hammons/Enibassy Suites

Assets:Cash and pooled investments $ — 638,671 638,671

______________

Liabilities:Accounts payable and other liabilities $ — — — —

R/D #87 Aksarben Bus & Education Campus

Assets:Cash and pooled investments S — 677 677

Liabilities:Accounts payable and other liabilities S — 338 338 —

Appeal Bond Deposit

Assets:Cash and pooled investments $ 1,125 850 50 1,925

Liabilities:Accounts payable and other liabilities $ 1,125 50 850 1,925

165 (Continued)

CITY OF OMAHA, NEBRASKA

Combining Statement of Changes in Assets and Liabilities

Agency Funds

Year ended December 31, 2012

Balance, Balance,January 1, December 31,

Automobile Impounding Deposit 2012 Additions Deductions 2012

Assets:Cash and pooled investments $ 108,522 37,408 53,459 92,471

Liabilities:Accounts payable and other liabilities $ 108,522 53,459 37,408 92,471

Bid Deposit

Assets:Cash and pooled investments $ 86,088 1,395,111 1,383,259 97,940

Liabilities:Accounts payable and other liabilities S 86,088 1,368,480 1,380,332 97,940

Board of Education Liquor Deposit

Assets:Cash and pooled investments S 145,575 548,712 547,600 146,687Accounts receivable 1,200 287,863 289,063 —

$ 146,775 836,575 836,663 146,687

Liabilities:Accounts payable and other liabilities 5 146,775 564,963 564,875 146,687

Board of Education Tobacco Deposit

Assets:Cash and pooled investments $ 9,863 46,712 54,229 2,346Accounts receivable 3,315 17,824 15,371 5,768Due from other funds

_______________

5,300 — 5,300

$ 13,178 69,836 69,600 13,414

Liabilities:Accounts payable and other liabilities 5 13,178 18,294 18,530 13,414

Humane Society Kennel Permits

Assets:Cash and pooled investments $ 72 6,073 6,145Accounts receivable 2,100 2,502 2,502 2,100

S 2,172 8,575 8,647 2,100

Liabilities:Accounts payable and other liabilities 5 2,172 4,272 4,200 2,100

Sales Tax Deposit

Assets:Cash and pooled investments $ 54,736 562,993 617,686 43Accounts receivable 29,355 85,252 88,910 25,697

$ 84,091 648,245 706,596 25,740

Liabilities:Accounts payable and other liabilities $ 84,091 606,207 547,856 25,740

After Hours Dance Deposit

Assets:Cash and pooled investments $ 5,000 — 5,000

Liabilities:Accounts payable and other liabilities $ 5,000 — — 5,000

166 (Continued)

CITY OF OMAHA, NEBRASKA

Combining Statement of Changes in Assets snd Liabilities

Agency Funds

Year ended December 3 2012

Balance, Balance,January 1, December31,

Board of Education Parking Fines 2012 Additions Deductions 2012

Assets:Cash and pooled investments S 67.572 587,617 583.275 71,914

Liabilities:Accounts payable and other liabilities S 67,572 587.833 592,175 71,914

Park Development Deposits

Assets:Cash and pooled investments 5 302,95l 961,091 l,l59,572 104,470

Liabilities:Accounts payable and other liabilities S 302,951 536,690 338,209 104,470

Arterial Street Improvement Program

Assets:Cash and pooled investments S 3,406,185 2,296.535 225,081 5,477,639

Liabilities:Accounts payable and other liabilities S 3.406.185 228.120 2,299,574 5,477,639

RID #102 First National Processing CenterAssets:

Cash and pooled investments S — 902,378 902,378 —

Liabilities:Accounts payable and other liabilities S — 451,189 451,189 —

Demolition Performance Bond

Assets:Cash and pooled investments $ 25,950 132,930 129,880 29,000

Liabilities:Accounts payable and other liabilities S 25.950 29.880 132,930 29,000

Performance Bond

Assets:Cash and pooled investments S 26.000 186.216 132.416 79,800

Liabilities:Accounts payable and oilier liabilities S 26,000 132,416 186,216 79,800

TIF Projects Contribution

Assets:Cash and pooled investments S — 122,000 — 122,000

Liabilities:Accounts payable and other liabilities S — — 122,000 122,000

Total Agency Funds

Assets:Cash and pooled investments S 7.076,161 52.041,373 50.799,237 8.318,297Accounts receivable 35.970 390,939 393.344 33,565Due from other hinds 1.221.300 — 1,221.300Accrued interest

— 1 .325 — I ,325Investments 1,196,735 1,199,688 1,200.000 1,196,423

Total assets S 8,308,866 54.854,625 52,392,581 10.770,9 10

Liabilities:Accounts payable and other liabilities $ 8,308,866 25,904,120 28,366,164 10,770,910

Total liabilities $ 8,308,866 25.904,120 28,366,164 10,770,910

See accompanying independent auditors’ report.

167

STATISTICAL SECTION

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CITY OF OMAHA

Statistical Section (Unaudited) ::December 31, 2012

This part of the City’s comprehensive annual financial report presents detailed information as a context forunderstanding what the information in the financial statements, note disclosures, and required supplementaryinformation says about the City’s overall financial health.

Contents Page

Financial Trends

These schedules contain trend information to help the reader understand how theCity’s financial performance and well-being have changed over time. 169

Revenue Capacity

These schedules control information to help the reader assess the City’s mostsignificant local revenue source, the property tax. 174

Debt Capacity

These schedules present information to help the reader assess the affordability ofthe City’s current levels of outstanding debt and the City’s ability to issueadditional debt in the future. 181

Demographic and Economic Information

These schedules offer demographic and economic indicators to help the readerunderstand how the environment within which the City’s financial activities takeplace. 187

Operating Information

These schedules contain service and infrastructure data to help the readersunderstand how the information in the City’s financial report relates to theservices the City provides and the activities it performs. 190

Sources: Unless otherwise noted, the information in these pages is derived from the comprehensive financialreports for the relevant year.

168

Snltedralo ICliv OFO7tIAlIA, 76BI9RASKA

Nat I’ositiott by Component

Last Ten seal Years(AcCrual Basin oiAesottnttnti)

2003 to 2012

2003 2003 2005 2006 2007 2008 2009 2010 2011 2012

(iosemrnental aetisttnesNeltnsentnnontnnenpttal astern 0 255.7 1.91 201,522.074 213,958,527 237.357.059 261,308.456 295,937,697 309,036,583 327,786.022 352,248.316 359.649,050

Osstttetad 32,067,872 11,696.950 13,163.72 14,612,499 16,814,445 15,109,807 0,238,405 6,380.609 6,565,759 7.390,845

Uotestnictasl 17,1 1,405 (nS,t66.250 80,623.315 60.396,154 49,343,457 (540,888) 24.680,926) (87,779,242) (158,706,840) (209,477,684)

Total getemtttetttalaetisities trot posittott $ 2)4.691.166 278.588.074 307.745.563 3(2,365.692 327,466,355 310,586,616 292,594,062 246.357.389 200.107.230 167.562,211

Bestoens.tyw tettctttet.Net tns.atttttettt tn e.tpttel assets $ 267,653,1 $t( 271.157.076 261,232,464 244,078,865 222,436,144 235,667,494 228,900,267 195,594,307 (66,025,886 136,922,155

llesttteted — — (0.155,739 (2,362,000 6,698,070 4,249,375 8,253,046 31,292,774 40,374,573 43,439,439Untestatetesl 11.656.667) 3.999,636 (2.064,272) 10,157.757 40,306,568 23,937,327 25.401.260 37,903,634 64,670,906 99,378,100

Total bsstnesn’typesettnitten set pastttett 0 285,976,522 275,156,7(4 266,383,951 266,598,622 269,662,802 263.053,196 262,564,575 263,790.7(5 271,079,365 279,739,734

N I I I I 5 4 (00 47 (7895 47 111011 49(4 9 4 183 7(4 (00 31(05191 5 79 60 6 9 803 9 518 74 0 496 571 05llesttteteel 52,067,672 ((.890,950 23.299.46)1 26,974,499 23,7(2,5(5 19,430,182 (6,491.451 37,643,385 46,940,332 60,850,204Ontesttiets’4 (5,454,736 69,165,666 77,659.043 70.553,891 69,652,045 23,396,439 720,334 549.075,606) (94,027,939) (I 10,099.5348

Total ptitltsrnnet positiott 8 570,867.71)) 553,744.765 576.129.514 576.961.3(4 597,129,160 574,439,8(2 555.140,635 511.140.104 471.106.595 447,301.955

((ASO 34 teas aeleptesl itt 20)12.

Sostrse: Ctt5 olOonalts ltnatnstal Ststettnetnts

Sue seeotttpsnstna tttte’ttt(ettt ttttIttttnt’ repson

169

Soh04ols 2CITY OF 0045,11,6. NEBR5,SKA

Chsogos is 7)05 00080s

Los,, Ton F 00) Yosro(Aooroul B,sin olA0005rning)

20035,, 2012

21(03 2004 2005 2006 2007 2008 2009 2010 2011 2082

Expossos

(IonorI go 5,0’O),, 6 51.899.189 82.023.849 43.617.209 40,179.313 93,334.595 95.914,3011 00,443.248 118.7211.1)38 102.6911.207 1118,841.109blsafoo 15’9157’9 1614500184 172.241.11,2 93,31)3.487 82,054.883 205,824,1)14 80.694,998 193,001.551 2)6,023.998 221,081.828

Tnsssponorios,ono,oos, 44.401.009 47.492,991 44,550.196 47.021,969 53.248,665 60,883,765 61)24,356 60,5)84,233 61.355.661 83,844,0360(60, psOl,nor,ioos 4.754.426 14.147.6,24 14.185,023 4.797.970 15,650,815 7,366,093 17.355,052 21,001,115 34.196.504 30.1152,963Cos,o)ydosolog,oos, 32,536,567 29,345,008 27,550,302 9,774,789 19,460,381 25.723,952 27,370.011 3.987,295 31,619,209 27,254,620Co)6,,o 551 noOn 30,376.92)) 1,2.71 3,346 53,992,416 57,818,310 44,894,282 40,9811.158 47,480,680 64.931,722 6(1,697.876 49,472.973

Io,,g.ono lob, 30.5111.243 24.2(13.001 52.326.602 32.457.752 34.691,594 36.519,508 37,443,850 30.360,978 35.225,037 33.961,752

Tool 40004m,0555( uos,,iooo 057055505 385.294,863 401.306.053 368.463.840 380.333.090 444.14(1.715 483,0) (.85(1 479,9(0,807 526,302.932 541,808.45(2 534.509,391

(o,00400ooon,or 60,0) 200.103 11.352.991 12,006,197 11,591,4(4 11.290.566 11,114,095 10.172,470 8.900,205 ((.064,689 16,760.1569400, 32.505.709 35,01,325 58,084.36) 39.502,641, 45,508.2(7 49.553,194 47.080.704 51.029,107 06.781.507 62.037,665

10,49(445 (0,51(2,170 1.807,06 ((.60(1.36’) 11.577.633 12,155.4(13 (2,122,555 (0.744.969 15.505,3(8 (3,226,0(11

To,o( hsns,,oss’,ypo oo6,i,, onponsos 43,252.307 57.446.486 61.900.477 1,2.854.429 68,176.4(8, 72,003,190 69.875.707 71,179.331 50,351,592 92,024.620

To),,) pros,or (5’0fl555505 6 4(18.577.150 450.833.339 430,564,3(7 448,188.019 512,316.631 555.815,040 049,794,594 597.562.263 622,160,054 826,534,011

ML(’is &lioanls,,d (Vo,kl64oo S,,Ioooos S 2.466,77) 2(1,025.073 20,032,090 22,047.661 25,035,904 27,211,194 27,425,186 26.300.147 40.351.582 44,898,851

Chorgon(10006,10,0055555005 S 27,286,77’) 7.606,19’) 8,430,849 8.090,356 5,054,592 5,729,600 8,560.90), 11.432,115 9,452,548 3,639.354l’,,06o s,(On 5.21.3,466 13.696.230 8,869,544 8.011,612 15.205,420 15,812,344 14.756,190 18,373,482 16,902.557 16,269.752Tro,,,p,,r,a,,o,,,or,iooo l0.’122.388 15.746,006 14,022.227 15.1,04.717 15,153.477 (8,045,115 19,0’(2,487 22,167.554 20,495,842 34,946.905l660r p,,060 5055005 5.921.059 5.996.074 5,367.207 3,756.052 9.620.112 1,205.471 3,877.405 2,502.65) 2.968.513 4.106.470l’ooo,,o,,irydo,olop,,,o,,, 6.2)0.800 13.247.956 11,1(5.776 10,757,997 0.540,329 6,397,642 7,465.072 5,748.813 10,555,050 11,036.131(‘,,)6,ros,,d p5,0, 206.580 4,10,7,573 6,595,5(50 I l.55l,l)52 4,789.667 3.545,045 10,177.203 0,772,589 9.094.553 13.412,015

(lO,05,4 0,5,5,55,01 oo,or,),,,60,,, 61.720,15), 50,647.742 58.1545,805 52,095.766 76,4111.775 02,6(5.753 70,638.578 65,624.631 81.334,162 70,615.981Copi,u) 6,0,06,05,1 o,,,,010,,,iooo 29.900.919 20.425.532 32.117.704 17.134,301 29.645(64 30.129,275 27,255.802 51.671,2(7 1,991,113 2,111,413

70,016’0505,,,,01500v,,,05

prog,o,,,,ooo,,,,os 147,525,144 139.45(l.176 44,724.262 128,599.5110 167,955,542 69,784345 161.503,643 66,372,952 161,623,738 158.938,171

B55555055’SflpOOOOSiOOs

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lIpo,a,,,,s, 455’os o,,d o,,,,,nho,,,,,,s 711,166 ‘129.479Cop,,o( 0,s’,,s md oos,rih,,,j,,,,, (.609.9)2 3.0)9.15% 5,795.21,6 9,56) .366 4.486.724 4.565.282 5.491,917

_______________ _______________

1.336.274

To,o18,,n,,,oso.l,poao,,,,Oo,pr,,or,o,o,o,o,,oos. 45,21)1,1125 46.426.423 53.353,955 611.639,673 1,1.388,77)) 64,853,594 66,518,445 68.424,329 77.720.758 97,1(4,963

TI prsoosy o’onssos S (92,735,169 105.871,.593 (98,101,257 l0’1,239.7%3 229.344,3)2 234,137.639 228.322.088 234,797.28) 239,344.496 254,053,134

C,,,,,po,,o,,,os,0,OlE/a & Ho,sla,,d (Vorkfomo 9,4,0,0,,,

500,005 S 1.666.667 19.142.608 21(754,59’) 23,467,351 24.863.872 29.865,01% 30.629,846 28,717,594 39.797,00)) 42,570,050((P06,15,54 srs,,,o 0,1 00,0,10,00,,,,

___________________

2.61,6.667 (.50)1,0)10 1,5)61.00)1 1.50036(0 1.815,000 - 1.023,808 5,5(3,605

5 1.666.61,7 22.7)19.275 22,254.59’) 24,967.355 26.363.072 31.68)15(18 50,629,846 25,717,594 40.820,608 46,383,715

No,o,6pomo:O 1217.769,73’)) )261,936,%83) (223,739,57%) (256.733,684% 1276,104,673) (313,727.805) (518,115,1(841 (380,059,905) (580,154.754) (377,571,220)

5,,si,,os,.mpo 00(15)64, 1.937.718 1)1.02)1.063) 10.546.402) (2.2)4.556) (6,787,14%) (7.949,596) (3,357,3421 (2.755.60) (2.630.034) 0.050.343

Toss,) 9 1215,532,1(2)1 777,956,741,1 (232.286.060) (298.948,236) (282,972,319) (321,1,77,49) (321,472,51(8) (362,714,982) (302.813,0881 (372.400,877)

MEL/a & I lo.,slond IV,,,06,,oo 601,,s,o,,, S (8)6).)04) 2,283.402 I ,7_’2,509 2,3(9,1,92 1,327,880 4.468,024 3,2)9,68)1 2.362.447 551,3(81 (.565,5 12

170 (Continued)

(tteralreverroea asrl other oh soot pOstliOs

Pr potty tooMotortehot,tsSolos arId 5 0,5

Paystrests jO 110110! 0505

Usroarrietad isvossoeitt

Sale ofoapira) assetsTtaasSsa

_____________ _____________ _____________ ______________

Total SilSerOs)e oral oollattres

BOsirseas-tpe aarivitros,CsresoioledhrsaeosaessearssosSale sIC capital CiCeroTrosafets

__________ __________ __________ __________

Total bossresstypo oottt riles

Tool

(‘rtrsrprrsersssttrrta

9)60th & I laoalatsrl Wsok600e SrrllrsrossOrss&tosa sot teatrreted to apoerSe prssesarsss

(‘lsosoe irs trot posrsiort’

llasrsoas’r9pe aorisrsjes

___________ ___________ ___________ ___________

Total

Cssstporsertrartsrrs’MOOT & I leattlasrl Wetkftrtoe Solorrosrs

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Sooroe. OIly 000rsoha ISsossetal Sirirrieiiia

(he cod halasee lit 21101 ft tire Otto does aol oratolt tIre 201(7 Ioegrsttrsg hslasee )oeeorrso it tsos tostoted it rselrrale Ito attseratrrmoflilkhors.

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SalsadIsla 2CITY OF 07113 lIT. NEIIRASK5S 4iaftr3t5

Clta500s io Nor I°ositioo

Last Tort Prsool Yaots(Aeooal Basis ofthoeoarstiso(

2(103 lot 21112

201(3 2004 2)105 2006 2007 2000 2009 201)1 2(11 2012

S 79.254,6(1 l11I.370,(101 94,292,79r1 99,432.280 14,935.2211 110,979.730 l30,016,943 130,320,939 139.574.329 l4l.765,3l99,637,101 9,9)4,977 9,03t),957 0,019,1111 8,829,ftTS 9.374.405 9,299(84 9,3t(ly995 9,(168,784 9.l63,5l8

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4.3)5,478 4.132.903 5.975.592 5.259,34I 5.943.008 5,098.222 4,595.289 4,938,1lI4 4.870,2(6 4)74,5221,619.924 2,725.710 2.298.1I3I1 3,446,775 6,222,915 4,720,079 .663.49) 1,440,959 2,008.l43 2.SftS,086l,I90,261 l.IOS.ft9S l.78l.2l5 163,5341 1143.254) 1,2911.879 (252,223)

471.81)5 Il23.ttSSl (L1I2.967) 54.1010 (l.385.I23) (558.6011 11,729.5871 Id.723.4001 18.345.1471 )3.163.477(

225.325.l75 255,633.5 69 252,Srt7,I(ST 7(4,553,909 201.434,294 296.048.053 3101,)72,6I0 313,773,3117 333.934.593 345.026.2I)0

)tt6.1L2( 74,475 tt57.991 403,227 2,8I0,341) l,58l,389 328,132 267,736 574.337 406.061(.280 5_,(75 7,7ttl 1)3.447) 1345.700) -

(471.816 I (21,699 I,) I2.9t’7 (54,001(1 I,385,l25 550.60) (.720.587 4,773,499 8.345.147 3)63.477

(536,3471 200.205 1.773.719 429.227 4.182.106 2)39.990 2.057.7)9 4.991.144 0,573,784 3,579,038

5 224.708.628 235.833,824 2S4,tt7O.705 76),7%3,036 285,616.310 298.988.1(53 302,180.329 3I8.764,45 I 342,508.377 348.596,238

S 90I.55t. l,)174.565 l.849,1113 2)29,239 2.562,799(9.71(0 616361 229.544 615.691 821.148 984.5)10 506.345

_______________ _______________ _______________

S 9(7,754 l,I34.726 7,l)77,357 2744 rtSO 3.383.437 984.500 506.343 -

S 7,555,43ts (6,3r(3,I 13) 29,157,489 4,52(l,129 5,249.621 I 16,0T9,742( I I7.992,554) (46,230r,673) (46,250,16)1 (32,545.02 0)1.4111.171 I l0,8l9.808) (6.772.TttT) I l,785.32l( (2.609,6301 IS.909.SOtt) 11.798,623) 2,236,142 6.288,ltSO 85t61).382

5 9,956,607 (IT, 22,977) 77,304,771r 2.834,9)10 2,ft4S.991 (77,6%9,349( (19.291.177) (44.0)111.53)) (39.961.5111 (23,884,638)

((7.16)1 3.410,128 3.6101,Ohtt S.lOt$,627 4.7(1,325 9,455,332 3.7(1.1)23 2.367,447 55630) 1,565.512

S 277.335.757 284,801l.I80 276.508,1(74 31(7.745,563 322,2I6.737 327.466.358 3 0658tt,6 (6 292.594,062 246.357.397 200,107.23)261.575.351 205,904,522 275,156.714 268.383.951 772.266.432 269,662,802 26S.OSS.I9tt 262.554,5732fa4.790,71527I,OTS.362

S 561.11)1.11)3 5711,967.7 01 593.744.788 576. (29.5(4 594.485.16S 597.129.160 574.439.0)7 555,48.635 5)1.140.107 47 ),l86.593

S 557(60 874,74)) 4,397,369 5.192.454 3,750406 17.968.381 23.421,7)5 27, lS2.7Stt 29,495383 30,l(46,484

S 794,89), (50 278.588.074 S((T,?4S,SttS 3)2.565,697 327.466.358 3 I0.356.616 297,594,I((t7 246.357,389 20().l()7,231 I67.562.2I295976527 °75,IStsTI4 26838395 I 766.599.622 269.692,042 263.853.196 262 .554.573 2fa4,790,7 IS’ 27I,t(79,3h5 279.739.744

S 57(l,86T,7I11 555,744,769 576)25,5)4 575,9)4.3(4 597.129.)61( 574.435.9)2 559,I48.635 5)1.140,1(4 47I.106.596 447.310.955

S 974.24)1 4.392.56% 8.1112.431 13,257,1156 I7.96S,3%I 23.42).? 3 27,132,739 79,495)91 30.1)46.484 31.6)1.996

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806,3,1,3Cu’S OF OMAHA, (EBRASKA

Chum,,, I, Foud Ruluooo, o(’Govon moulul F,md, 7’’

(ModulAR ol’Aooo,mOuo)

2803(02012

2003 2004 2008 2006 2007 2008 2009 20(0 2011 20(2

Proporly $ 92,696.954 96.380,823 89,341.424 94,917.441 102.681,475 12.354.610 17,561,400 30,625.280 133.175,220 140,715,380Molorool,io)o 8,3,37,101 8,5(4,977 9.030.957 8,516,011 8.825.629 9.374.405 9.299.184 9.309.995 9.068,784 9.163,518Cily ,aIor oud 00 102,413.934 (.007,9 14,184,544 I (3.025,998 I (6.051.364 I 24,470.354 (20,735,362 126,910.238 126,636.793 128.379,322Soujooso 27,423,096 27.000, 2 26,045,997 20,781.000 30,884.535 34,249.57 34,25 .051 38.225.765 60.121.475 82.331,646

4,315,438 4.132,805 5.575,592 5,259.341 5,543.008 5.595.722 4,590,983 4.538,013 4.870,216 4.174.522l,,00u,o, md porl1i1 7,899,272 9.699.324 8.248.962 5.216,566 8,044,824 8,022,731 7.125.382 5.447,524 5.627.653 0.953.636IululOO,Oflu000lu) 69,705,612 49.655,652 47,399,603 43.152.752 49,850.176 41,275.519 37,433,627 39.943,475 39,259.990 41.596.021luoou600uli,00mo 1.610,924 2,004,225 2.298.930 5,446,225 6.722.9(5 4.720,079 (.669.490 (.291,935 1.834,089 2.133.508Rovoooo ho,, K000 6.113.009 6.016,221 1,209.779 6.811,565 7,693.010 7.455,212 6.195,196 6.959.045 7.222,115 7.220.283Charm,, ir ,or100u 41,365,731 41,872,226 38.007,379 39.246.354 45,727.075 45,777,345 61.279,665 49.441,858 53,453,047 54.706.031Soul,’ oml royulliou 5(8,077 3.788.825 2.487.922 2,521,666 5,353.045 2.726,418 1.459.459 2,388,690 2,066,022 22.628.777Couu,hulo,moud groorl (7.066.045 32,664,861 31,790,177 (9,733,628 48.985,045 56.8(5,186 41,657.358 44,964,597 44.972,195 52.404.647

Told ro,00uoo 31,9763690 392,037,962 382.221,266 376.530.355 435.362,104 453,170.451 443.252.060 462,049,415 493,337.632 535.7(0.289

hupoodi hrOO

(,‘ouorul golommOol 47,971,879 35,042,752 30.437,115 35,503.736 40,699.673 52,797.201 44.237.2(7 45,400.158 45,478.299 48,389.444Pohliouu(Sly 142.681.534 154,177,140 164.989,313 174,588,175 (83.747.075 197.108.649 195.927.042 192,681.092 209.5(3.357 2(3,740,374Tr.m,po,Lu,o, uorvi001 37,621.204 39.907.448 37.51 2,546 39,232,879 43,421,768 40,623,732 48.208.708 47,095.967 48,800.535 48.966,496OliorI,oh(io ,or,iooo 14,613,596 (3,957.726 13.920,71,3 4,364,9(6 (4,750.946 (6,929.963 16.403.382 20,0(2.730 33,340.836 29,5(3.629Cornuu,ohy dooIopmool 32,424,252 45.157,257 27,680,503 19,346.165 (8,744,993 25,039.148 26.735.726 27,990.076 26,008.123 26,243,564C,dlorouud pork, 79.399,038 33,900,044 31,431,397 28.751,405 31,551.223 30,321.658 29.906.063 31,916,664 99.392.941 39,807,813

0061 ,Oroioo.

Prioop.,) 54999209 24,261.1,67 25,925,284 28,511,694 42,032,712 72,787.519 36,895,854 35.934,250 40.000,182 47,062,1401110,00 30.044,01,4 21.744.997 31,096,744 31,506,002 33,532,480 34,954,674 76,899.394 38.360.979 35,225,036 3 .9.503.9(9So,,d 6r,u,uo 0040 2,090,2(7 702,799 161.026 303.209 1,346.4611 1.271.689 740,549 303,220 973.240

(‘apilol 001(19 136,739.116 39,033,370 47,748.502 42.654,793 55,734,797 76,697,970 64,595,974 79,279,779 55,701.862 32,019,516

lola) oupoodlor0u 5,32,462,901 409.372,110 41(1,041,566 414.221,413 460.369.676 556.597.920 500,791.049 519.491.902 533,564,991 5(5.928,163

Dolioo,,oyol’rouo,oouo,,doroupood,lorou ((62,719,103) ((7,334,1561 (21,620.3001 (37.691.0301 (32.947,572) (103,422,4691 (57.520.989) (57.442,487) (40.226,759) 20.3 12.I’_h

Olhorloooo,og soor000

Trom6r, (0 8,705,765 4,791(222 750.000 654.000 1.434.525 679.238 5.970,605 6.442,775 (.045,890 2,326.795Tr,mu(broool (7.731,961) (4,92 1,077) ((.062,967) (600.000) (2,619,1,48) (1,237,839) (7.300.192) 311.169.286) (10.191.027) (5,490,210)0,1(01 ol’oupilu( lomb (.243.595 (.759.449 1,577,271 421.700 1,334,919 647,494 12.044,740 658.000Pr000od, (ion, hood, iom,od 47,210.633 36,964,036 47.369,296 (0.521.516 57,565.000 146.483.605 91.392.000 77,485.000 27,995.000 77,890,862(1,0000,1, Son,opooi,,I,o,osuu,ooldohl 1.215,000Prooood, ol’ro6mdog hood, 256,730.785 6,990.000 ((.425,000 45.560.000 - 35.067.065(1r0000)o So,, in,,0,,00 00,0o 2,962,858Prooood,)p,,9m,ool 6,, hood

prouuonu’dioooo,b, 00, 543,236 169.931, 671.695 4.350.806 4,649,445 2,435,125 1,349.912 8.350,765Poymbool hroflbud hood oso,om 00010 (294.759.954) (63(59.000) (11,667.90(1 (17.900.194) (79.064.654) (48.297.153) (17.985.111) (22.768.906) (86,043.834)0000ool 0,150(0 oihood,

_______________ _______________ _______________ _______________ _______________ _______________ _______________

(346.191)

_______________

(3.9221

Tobol othorliouocop10111001 (‘1101) 50.141,033 43.533.5(1 49,631,836 15.501.551 98.951,381 71,632.856 93.109,624 37.506.794 (0,275,599 31.983,461

No, oh0000 6, lOud hdu,,00o 8 (((2.571.770) 26(99,362 20.0(1.556 (19.109.5071 1,003.809 (3(794.6(31 35,580.635 ((9,935.893) (29.931.160) 52.365.587

SohI Soru,oo 0(01COb01b000)

o000m,iSl oupoodiboro, 27.37% 4.93% 5.74% 9.33% 23,05% 29,42% 20,80% 20,55% (8.77% 20,43%

Sooroo (‘ibyol’Omdro F,00ooio( Sl.do,,,o,01

SOC 0CC0Ill0li 0 iiolopo,,do,,Iotidibors’ roporb.

173

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tax

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0.10

282

.018

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25,2

03,9

294,

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329

9,16

7.64

48,

637,

101

4.65

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131,

352

3.35

2,61

7—

-

2004

117,

526,

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84,7

30,7

0025

,889

,143

14,1

36,5

7711

,766

.177

8,81

4,97

75,

104,

462

3,94

6,63

03,

523,

756

2005

120,

873,

521

88,6

60,3

6425

,503

,946

13,7

25,2

1511

,896

,323

8,80

8,67

75,

435,

528

6.36

0,67

23,

589,

703

—

2006

122,

721,

806

93,1

65,0

2824

,790

,938

14,3

52,2

1711

,751

,030

8,81

8,01

15,

989,

404

5,05

6,17

44,

048,

296

2007

128,

625,

275

98,1

42,1

5628

,638

,167

14.9

65,6

9514

,934

,190

8,82

5,62

96,

990,

559

5,22

9,23

34.

312,

349

2008

131,

801,

803

109,

912,

905

29,4

59,9

7515

,932

,992

15,5

25,8

389,

374,

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8,31

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46,0

2615

,638

,431

9,29

9,18

48,

087,

878

4,41

1,08

74,

952,

987

—

2010

131,

455,

524

128,

501,

803

27,6

74,5

3614

,815

,170

18,3

48,7

729,

309,

995

8,16

2,03

14,

356,

585

5,19

8,24

34,

419,

993

2011

133,

278,

455

133,

399,

969

30,3

71,2

6814

,963

,767

23,2

47,3

229,

068,

784

9,31

4,65

34,

362,

256

5,61

7,73

423

,796

,387

2012

128,

379,

322

138,

875,

565

32,4

52,0

1316

,254

,082

22,8

70,9

809,

163,

518

7,54

3,40

13,

666,

563

5,44

9,20

324

,851

,426

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174

Schedule 6CITY OF OMAHA, NEBRASKA

Assessed Value and Estimated Actual Value of Taxable Property

Last Ten Fiscal Years

Real property Other propertyPersonal!

Residential! centrally Total taxable Totalcommercial assessed assessed direct

property property value tax rate

Year ended December 31:2003 $ 17,209,603,450 2,193,041,999 19,402,645,449 43.3872004 18,140,043,695 1,951,348,065 20,091,391,760 43.3872005 19,561,022,580 1,934,101,080 21,495,123,660 43.3872006 20,407,325,900 1,858,658,545 22,265,984,445 43.3872007 23,466,618,660 1,835,621,110 25,302,239,770 43.3872008 24,851,524,870 1,658,411,000 26,509,935,870 43.3872009 25,148,357,122 1,929,355,078 27,077,712,200 47.5872010 24,966,532,305 1,923,371,175 26,889,903,480 49.9222011 25,675,576,785 1,807,884,970 27,483,461,755 49.9222012 26,035,695,300 1,877,985,140 27,913,680,440 49.922

Note: Property is assessed at actual value; therefore, the assessed values are equal to actual value.

Taxes assessed by the County during 2012 are not due and payable until 2013.

Source: Douglas County Assessor’s Office.

See accompanying independent auditors’ report.

175

Schedule 7CITY OF OMAHA, NEBRASKA

Property Tax Rates

Direct and Overlapping Governments

2007 —2012

2012—2013 2011—2012 2010—2011 2009—2010 2008—2009 2007—2008

City of Omaha:General fund 0.28447 0.28447 0.28447 0.26112 0.24312 0.24312Judgment 0.00600 0.00600 0.00600 0.00600 0.00600 0.00600Debtservicc 0.19281 0.19281 0.19281 0.19281 0.17581 0.17581Rcdeveloptnentdcbtservice 0.01594 0.01594 0.01594 0.01594 0.00894 0.00894

Total City of Omaha 0.49922 0.49922 0.49922 0.47587 0.43387 0.43387

Overlapping rates:Douglas County 0.26459 0.26459 0.26459 0.24519 0.24519 0.24519Omaha Douglas Building Commission 0.01300 0.01300 0.01300 0.01300 0.01300 0.01096Papio NRI) 0.03275 0.03275 0.03275 0.03275 0.03375 0.03485Omaha Ptiblie Schools 0.25465 0.25909 0.25863 0.25572 1.20064 1.20059Metro Community College 0.08500 0.08500 0.08500 0.08500 0.06740 0.06740Edtication service units 0.01500 0.01500 0.01500 0.01500 0.01500 0.01500OmahaTransitAuthority 0.05027 0.04872 0.04872 0.04674 0.04613 0.04617Learning community 0.96000 0.96000 0.96000 0.96000 — —

Learning community— capital projects — 0.00125 0.00125 0.00500 — —

Total overlapping rates 1.67526 1.67940 1.67894 1.65840 1.62111 1.62016

Total tax rate 2.17448 2.17862 2.17816 2.13427 2.05498 2.05403

Note: Overlapping rates arc those of local and county governmetsts that apply to property ownerswithin the City of Omaha.

Sources: Douglas County Clerk’s Office and City of Omaha Finance Department.

See utccompanying independent auditors’ report.

176

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87,1

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—88

,660

,365

101.

7188

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93,2

60,8

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,592

,309

—98

.21

1,57

2,71

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,165

,028

99.9

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,165

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96,6

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2796

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,641

—99

.91

1.62

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98,1

42,1

5610

1.59

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115,

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113,

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-98

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1,70

8,78

2—

115,

586,

354

100.

4911

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9,87

897

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1,87

3,13

424

3,06

712

8,06

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899

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128,

501,

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2011

134,

239,

776

131,

111,

754

218,

348

97.6

71,

644,

917

424,

950

132,

756,

671

99.3

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6,88

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326

0,64

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178

Schedule 10CITY OF OMAHA, NEBRASKA

Total City Taxable Sales

Last Ten Fiscal Years

Total City Totaltaxable direct

sales tax rate

Year ended December 3 1:2003 $ 7,605,363,133 0.01502004 8,058,991,867 0.01502005 8,292,560,467 0.01502006 8,413,842,533 0.01502007 8,819,720,867 0.01502008 9,037,369,933 0.01502009 8,736,921,267 0.01502010 9,023,580,333 0.01502011 9,143,290,667 0.01502012 9,630,891,267 0.0150

Source: City of Omaha Revenue Division.

See accompanying independent auditors’ report.

179

Schedule 11CITY OF OMAHA, NEBRASKA

Sales Tax Rates

Direct and Overlapping Governments

Last Ten Fiscal Years

Direct Overlapping’City of State of TotalOmaha Nebraska tax rate

Fiscal year:2003 0.015 0.055 0.0702004 0.0 15 0.055 0.0702005 0.015 0.055 0.0702006 0.015 0.055 0.0702007 0.015 0.055 0.0702008 0.015 0.055 0.0702009 0.015 0.055 0.0702010 0.015 0.055 0.0702011 0.015 0.055 0.0702012 0.015 0.055 0.070

Note: Overlapping rates are those of other governments that apply to consumers within the City of Omaha.

See accompanying independent auditors’ report.

180

CI

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Schedule 13CITY OF OMAHA, NEBRASKA

Ratios of General Obligation Debt Outstanding

Last Ten Fiscal Years

Ratio ofnet debt

Less amounts Net to estimatedGeneral available in bonded valuation

obligation debt debt per of taxablebonds service fund Total capital’ real property2

Fiscal year:2003 $ 432,926,472 11,057,002 421,869,470 1,022 2.172004 463,106,472 23,555,462 439,551,010 1,052 2.192005 484,756,472 18,892,007 465,864,465 1,101 2.172006 476,256,472 11,888,320 464,368,152 1,084 2.092007 536,826,472 16,491,540 520,334,932 1,202 2.062008 558,062,463 18,976,244 539,086,219 1,229 2.032009 545,829,194 13,489,712 532,339,482 1,171 1.972010 526,180,000 16,693,476 509,486,524 1,246 1.892011 518,750,000 18,595,398 500,154,602 1,200 1.822012 516,794,764 18,689,053 498,105,711 1,189 1.78

Note: Details regarding the City’s outstanding debt can be found in the notes to the financial statements.

Population data can be found in table 17, Demographic and Economic Statistics.2 Property value information can be found in table 6, Assessed Value and Actual Value of Taxable Property.

See accompanying independent auditors’ report.

182

Schedule 14CITY OF OMAHA, NEBRASKA

Direct and Overlapping Governmental Activities Debt

December31, 2012

Estimated Direct andDebt percentage overlapping

Governmental units outstanding applicable’ debt to the City

Direct:City4 $ 498,105,711 100.00% $ 498,105,711

Overlapping:Douglas County 70,185,000 76.25 53,516,063Omaha-Douglas Public Bldg. Commission2 34,770,000 76.25 26,512,125School District of Omaha2 264,281,949 85.91 227,044,622School District of Ralston3 27,449,600 72.78 19,977,819School District of Millard3 127,665,000 62.65 79,982,123School District of Elkhorn3 141,895,000 49.24 69,869,098School District No. 66 of Douglas County3 23,745,000 100.00 23,745,000

689,991,549 500,646,850

Total $ 1,188,097,260 $ 998,752,561

Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries ofthe City. This schedule estimates the portion of the outstanding debt of those overlapping governmentsthat is borne by the residents and business of the City. This process recognizes that,when considering the government’s ability to issue and repay long-term debt, the entire debt burdenborne by the residents and businesses should be taken into account. However, this does not implythat every taxpayer is a resident and, therefore, is responsible for repaying the debt, of each overlappinggovernment.

The percentage of overlapping debt applicable is estimated using taxable assessed property values.Applicable percentages were estimated by determining the portion of the City’s taxable assessed valueand dividing it by the corresponding overlapping government unit’s taxable assessed value.

2 Payable from certain property tax revenues and payments to be made to it by the City of Omahaand Douglas County under certain contractual agreements. Actual rental payments by the City for2012 were $1,583,353. The Act authorizing issuance of bonds by the Omaha-Douglas Public BuildingCommission permits them to levy a tax of $0.17 per $100 of actual valuation on all the taxable propertyin Douglas County. However, although the same Act authorizes the City to levy a tax on all the taxableproperty in the City, except intangible property, of $0.17 per $100 of actual valuation in excess of theCharter limitation described under “AUTHORiTY TO LEVY TAXES,” if and to the extent necessaryto make the City’s payments to the Commission, no such levy has ever been made by the City forsuch purpose.

Residents of the City reside in one of the five school districts and pay taxes only to thatschool district. These numbers represent bonds outstanding as of December 30, 2012.

The debt for the City of Omaha is based on the general obligation debt.

Source: The information regarding the bonds outstanding comes from the State of Nebraska Auditor ofPublic Accounts Web site, reported as of December 30, 2012.

See accompanying independent auditors’ report.

183

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184

Schedule 16CITY OF OMAHA, NEBRASKA

Pledged Revenue Coverage —.

Last Ten Fiscal Years

Direct NetGross operating available Debt service requirements

revenue1 expenses2 revenue Principal Interest Total3 CoverageUtility service

chargesSewer System

2003200420052006200720082009201020112012

S 34,232,617 20,084,158 14,148,45932,182,282 22,072,931 10,109,35133,279,697 23,515,095 9,764,60234,759,942 24,434,713 10,325,22940,573,046 26,148,634 14,424,41241,969,126 29,381,293 12,587,83343,704,193 29,341,757 14,362,43649,783,043 32,629,953 17,153,09059,414,374 35,082,144 24,332,23073,636,605 35,026,078 38,610,527

1,614,5061,487,5111,439,0302,475,8542,436,6793,832,6823,968,0394,790,9456,183,6929,819,735

888,373 2,502,8791,745,792 3,233,3031,512,034 2,951,0642,558,781 5,034,6355,078,921 7,515,6005,080,556 8,913,2384,867,190 8,835,2296,246,860 11,037,8057,670,908 13,854,6007,797,934 17,617,669

Generally, gross revenues include sewer use fees and interest on investments.Generally, direct operating expenses iuclttde sewage treatment and pumping, sewer maintenance, administrative and general, and industrial Ivaste control.Excluded from direct operating expense are depreciation and amortization.The numbers reflect tlte total annual fiscal year’s debt service requirements on all the outstanding senior and junior revenue bonds and notes.

Net revenuesConvention Center Hotel from Manager

2004 S 5,197,148 1,111,614 4,085,5342005 5,197,148 l,lll,6l4 4,085,5342006 7,046,759 1,766,738 5,280,0212007 8,414,989 1,835,394 6,579,5952008 9,715,892 1,956,436 7,759,4562009 7,065,949 1,863,396 5,202,5532010 8,274,289 1,569,043 6,705,2462011 6,969,693 1,971,401 4,998,2922012 11,248,005 1,506,695 9,741,310Generally, gross revenues include net revenues from manager and interest on investments.

(2) Generally, direct operating expenses include administrative costs, taxes, and insurance.Excluded from direct operating expense are depreciation and anlortization.Hotel opened April I, 2004.

Dock rentalDodge Park Marina Fund fees

2002 $ 467,548 233,494 234,0542003 407,690 240,315 167,3752004 406,644 219,965 186,6792005 424,648 277,860 146,7882006 444,992 261,985 183,0072007 517,829 300,929 216,9002008 504,623 325,086 179,5372009 498,450 450,812 47,6382010 446,039 283,542 162,4972011 397,344 272,036 125,3082012 603,435 471,743 131,692Generally, gross revenues include net slip rental fees, concessions, and interest on investments.

(2) Generally, direct operating expenses include operating and maintenance costs.Excluded from direct operating expense are depreciation and amortization.

Special tax revenue Redevelopmentredevelopment bonds levy

5.653.133.312.051.921.411.631.551.762.19

0.950.950.991.241.261.001.220.891.18

1.451.011.160.891.161.341.12

N/AN/AN/A

0.660.870.570.580.690.680.620.900.920.94

315,000470,000640,000

120,000130,000130,000140,000140,000150,000155,000

855,000885,000

1,125,0001,360,0001,095,0001,420,0001,730,0002,315,0002,390,0002,625,000

4,280,5274,280,5275,318,6655,299,3076,158,5465,192,2175,185,9175,170,2177,606,435

41,35536,30930,52424,62818,39812,0385,288

1,721,3441,125,0712,082,7621,929,6021,768,3611,889,6802,105,9452,302,7142,228,5702,113,708

4,280,5274,280,5275,318,6655,299,3076,158,5465,192,2175,500,9175,640,2178,246,435

161,355166,309160,524164,628158,398162,038160,288

2,576,3442,010,0713,207,7623,289,6022,863,3613,309,6803,835,9454,617,7144,618,5704,738,708

2003 S 1,698,219 — 1,698,2192004 1,757,854 — 1,757,8542005 1,815,671 — 1,815,6712006 1,924,414 — 1,924,4142007 1,987,825 — 1,987,8252008 2,266,497 — 2,266,4972009 2,386,049 — 2,386,0492010 4,175,584 — 4,175,5842011 4,258,621 — 4,258,6212012 4,436.505 — 4,436,505

Gross revenue include the Special Tax Redevelopment Property Tax Levy.

185 (Continued)

Schedule 16CITY OF OMAHA, NEBRASKA

Pledged Revenue Coverage

Last Ten Fiscal Years

Direct NetGross operating available Debt service requirements

revenue’ expenses2 revenue Principal interest Total3 Coverage

Special Obligation Bonds

2003 S 105,555,834 — 105,555,834 613,217 3,425,480 4,038,697 26.142004 114,508,723 — 114,508,723 596,024 3,401,295 3,997,319 28.652005 119,192,495 .— 119.192,495 621,813 3,376,938 3,998,751 29.812006 116,878,412 — 116,878,4l2 643,542 3,352,007 3,995,549 29.252007 121,702,023 — 121,702,023 670,527 3,325,702 3.996,229 30.452008 128,318,818 — 128,318,818 699,182 2,455,815 3,154,997 40.672009 125,060,406 — 125,060,406 1,442,837 3,645,523 5,088,360 24.582010 130,252,172 — 130,252,172 1,251,492 3,589,306 4,840,798 26.912011 129,912,045 — 129,912,045 1,300,878 3,534,862 4,835,740 26.862012 131,719,136 — 131,719,136 1,360,264 3,210,247 4,570,511 28.82

Gross revenues include state cigarette tax, TIF revenues, land sales, and sales tax.Generally, direct operating expenses include ad,ninistrativc costs, taxes, and insurance.

“ Sewer Revenue portio,, of debt service requ,rernent reported under the Sewer Revenue Fund.

Street & Highway TaxAllocation Bonds

2009 5 27,572,563 — 27,572,563 145,000 91,084 236,084 116.792010 27,674,538 .--- 27,674,538 145,000 84,503 229,503 120.582011 30,371,268 — 30,371,268 65,000 77,645 142,645 212.922012 32,469,853 — 32,469,853 180,000 73,578 253,578 128.05

Gross revenues include state Street and highway allocation taxes.

See accompanying independent auditors’ report.

186

Schedule 17CITY OF OMAHA, NEBRASKA

Demographic and Economic Statistics

Last Ten Fiscal Years .

Per capitaPersonal personal School Unemployment

Population1 income2 income2 enrollment3 rate4

Fiscal year:2003 412,679 $ 18,084,044 38,008 71,325 4.32004 417,702 19,221,889 39,970 72,407 4.32005 423,255 20,283,646 41,693 73,182 4.32006 428,263 21,424,933 43,599 74,288 3.42007 432,791 22,786,541 45,946 75,318 3.32008 438,646 23,941,124 47,588 75,764 3.72009 454,731 23,428,776 45,921 77,096 5.02010 409,850 23,584,222 45,473 77,560 4.72011 416,855 24,672,885 47,008 78,708 5.02012 419,041 N/A N/A 78,796 4.4

Sources: U.S. Census Bureau.2 U.S. Department of Commerce Bureau of Economic Analysis. Personal Income and Per Capita Income

are based on Douglas County figures. The figures for the year 2000 Personal Income and Per CapitaPersonal Income are based on estimates.

Omaha Public Schools, Millard Public Schools, District 66.United States Department of Labor — Bureau of Labor Statistics

The unemployment rates are for the Omaha — Council Bluffs Metropolitan Statistical Area.

See accompanying independent auditors’ report.

187

Schedule 18CITY OF OMAHA, NEBRASKA

Pimcipal Employers

2012Percentageof total City

Employer Employees Rank employment

Offutt Air Force Base 7,500+ 1 1.93%Alegent Health 7,500+ 2 1.93Omaha Public Schools 5,000+ 3 1.93Methodist Health System 5,000+ 4 1.29The Nebraska Medical Center 5,000+ 5 1.29University of Nebraska Medical Center 2,500+ 6 1.29First Data Corp. 2,500+ 7 0.64Union Pacific 2,500+ 8 0.64HyVee Inc. 2,500+ 9 0.64First National Bank of Nebraska 2,500+ 10 0.64West Corp. 2,500+ 11 0.64Walmart Stores 2,500+ 12 0.64ConAgra Foods 2,500+ 13 0.64Mutual of Omaha 2,500+ 14 0.64Creighton University 2,500+ 15 0.64

Total 15.42%

2011Percentageof total City

Employer Employees Rank employment

Alegent Health 7,500± 1 1.99%Offutt Air Force Base 7,500+ 2 1.99Omaha Public Schools 7,500+ 3 1.99The Nebraska Medical Center 5,000± 4 1.33Methodist Health System 5,000+ 5 1.33First Data 5,000+ 6 1.33Union Pacific Corporation 2,500+ 7 0.66University of Nebraska Medical Center 2,500+ 8 0.66West Corp. 2,500+ 9 0.66First National Bank of Omaha 2,500+ 10 0.66Mutual of Omaha 2,500+ 11 0.66Wal-Mart Stores 2,500± 12 0.66City of Omaha 2,500+ 13 0.66ConAgra Foods 2,500+ 14 0.66Creighton University 2,500+ 15 0.66

Total 60,000+ 15.90%

Note: Data not available for employers eight years prior.

Sources: Greater Omaha Economic Development Partnership — Omaha Chamber of Commerce Web site.

See accompanying independent auditors’ report.

188

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[This page left blank intentionally.]

APPENDIX C

FORM OF CONTINUING DISCLOSURE UNDERTAKING

Following is the text of Section 11 of the Ordinance. Such Ordinance provisions comprise the

City’s continuing disclosure undertakings pursuant to Securities and Exchange Commission

Rule 15c2-12(b)(5)(i) with respect to the Bonds.

(a) That the City does hereby covenant and agree and enter into a written

undertaking for the benefit of the holders and beneficial owners of the Bonds in accordance with

Section (b)(5)(i) of Securities and Exchange Commission Rule 15c2-12 under the Securities

Exchange Act of 1934, as amended (17 C.F.R. § 240.15c2-12) (the “Rule”). Capitalized terms

used in this Section 11 and not otherwise defined in this Ordinance shall have the meanings

assigned such terms in subsection (d) hereof. It being the intention of the City that there be full

and complete compliance with the Rule, this Section shall be construed in accordance with the

written interpretative guidance and no-action letters published from time to time by the Securities

and Exchange Commission and its staff with respect to the Rule.

(b) The City undertakes to provide the following information as provided in this

Section 11:

(i) Annual Financial Information;

(ii) Audited Financial Statements, if any; and

(iii) Material Event Notices.

(c) (i) The City shall while any Bonds are outstanding provide the Annual

Financial Information on or before the date which is 270 days after the end of each fiscal year of

the City (the “Report Date”) to the MSRB in an electronic format accompanied by identifying

information as prescribed by the MSRB. The City shall include with each submission of Annual

Financial Information a written representation to the effect that the Annual Financial Information

is the Annual Financial Information required by this Section 11 and that it complies with the

applicable requirements of this Section 11 and that it has been provided to the MSRB. If the City

changes its fiscal year, it shall provide written notice of the change of fiscal year to the MSRB. It

shall be sufficient if the City provides to the MSRB any or all of the Annual Financial

Information by specific reference to documents previously provided to the MSRB or filed with

the Securities and Exchange Commission and, if such a document is a final official statement

within the meaning of the Rule, available from the MSRB.

(ii) If not provided as part of the Annual Financial Information, the City

shall provide the Audited Financial Statements when and if available while any Bonds

are outstanding to the MSRB.

(iii) If a Material Event occurs while any Bonds are Outstanding, the City

shall provide a Material Event Notice in a timely manner, not in excess of 10 business

days after the occurrence of the event, to the MSRB. Each Material Event Notice shall be

so captioned and shall prominently state the date, title and CUSIP numbers of the Bonds.

C-2

(iv) The City shall provide in a timely manner to the MSRB notice of any

failure by the City while any Bonds are outstanding to provide to the MSRB Annual

Financial Information on or before the Report Date.

(v) Any filing or report under this Section 11 may be made solely by

transmitting such filing or report to the MSRB in an electronic format accompanied by

identifying information as prescribed by the MSRB.

(d) The following are the definitions of the capitalized terms used in this Section 11

and not otherwise defined in this Ordinance:

(i) “Annual Financial Information” means the financial information or

operating data with respect to the City, provided at least annually, of the type included in

Appendix B of the final official statement with respect to the Bonds. The financial

statements included in the Annual Financial Information shall be prepared in accordance

with generally accepted accounting principles (“GAAP”) for governmental units as

prescribed by the Government Accounting Standards Board (“GASB”). Such financial

statements may, but are not required to be, Audited Financial Statements.

(ii) “Audited Financial Statements” means the City’s annual financial

statements, prepared in accordance with GAAP for governmental units as prescribed by

GASB, which financial statements shall have been audited by such auditor as shall be

then required or permitted by the laws of the State of Nebraska.

(iii) “Material Event” means any of the following events, with respect to the

Bonds:

(A) Principal and interest payment delinquencies;

(B) Non-payment related defaults, if material;

(C) Unscheduled draws on debt service reserves reflecting financial

difficulties;

(D) Unscheduled draws on credit enhancements reflecting financial

difficulties;

(E) Substitution of credit or liquidity providers, or their failure to

perform;

(F) Adverse tax opinions, the issuance by the Internal Revenue

Service of proposed or final determinations of taxability, Notices of Proposed

Issue (IRS Form 5701–TEB) or other material notices or determinations with

respect to the tax status of the security, or other material events affecting the tax

status of the Bonds;

(G) Modifications to rights of Bondholders, if material;

(H) Bond calls, if material, and tender offers;

C-3

(I) Defeasances;

(J) Release, substitution or sale of property securing repayment of

the Bonds, if material;

(K) Rating changes;

(L) Bankruptcy, insolvency, receivership or similar event of the

City;

(M) The consummation of a merger, consolidation or acquisition

involving the City or the sale of all or substantially all of the assets of the City

other than in the ordinary course of business, the entry into a definitive

agreement to undertake such an action or the termination of a definitive

agreement relating to any such actions, other than pursuant to its terms, if

material; and

(N) Appointment of a successor or additional paying agent or the

change of name of a paying agent, if material.

(iv) “Material Event Notice” means electronic notice of a Material Event.

(v) “MSRB” means the Municipal Securities Rulemaking Board. On July 1,

2009 the MSRB became the sole repository to which the City must electronically submit

Annual Financial Information, Audited Financial Statements, if any, and Material Event

Notices pursuant to this Section 11. Reference is made to Commission Release No.

34-59062, December 8, 2008 (the “Release”) relating to the MSRB’s Electronic

Municipal Market Access (“EMMA”) system for municipal securities disclosure which

became effective on July 1, 2009. To the extent applicable to this Section 11, the City

shall comply with the Release and with EMMA.

(e) (i) The continuing obligation hereunder of the City to provide Annual

Financial Information, Audited Financial Statements, if any, and Material Event Notices shall

terminate immediately once the Bonds no longer are outstanding. This Section 11, or any

provision hereof, shall be null and void in the event that the City obtains an opinion of nationally

recognized bond counsel to the effect that those portions of the Rule which require this

Section 11, or any such provision, are invalid, have been repealed retroactively or otherwise do

not apply to the Bonds, provided that the City shall have provided notice of such delivery and the

cancellation of this Section 11 to the MSRB.

(ii) This Section 11 may be amended, without the consent of the

Bondholders, but only upon the City obtaining an opinion of nationally recognized bond

counsel to the effect that such amendment, and giving effect thereto, will not adversely

affect the compliance of this Section 11 by the City with the Rule, provided that the City

shall have provided notice of such delivery and of the amendment to the MSRB. Any

such amendment shall satisfy, unless otherwise permitted by the Rule, the following

conditions:

(A) The amendment may only be made in connection with a change

in circumstances that arises from a change in legal requirements, change in law

C-4

or change in the identity, nature or status of the issuer or type of business

conducted;

(B) This Section 11, as amended, would have complied with the

requirements of the Rule at the time of the primary offering, after taking into

account any amendments or interpretations of the Rule, as well as any change in

circumstances; and

(C) The amendment does not materially impair the interests of

Bondholders, as determined either by parties unaffiliated with the City (such as

nationally recognized bond counsel), or by approving vote of Bondholders

pursuant to the terms of this Ordinance at the time of the amendment.

The initial Annual Financial Information after the amendment shall explain, in narrative

form, the reasons for the amendment and the effect of the change, if any, in the type of operating

data or financial information being provided.

(f) Any failure by the City to perform in accordance with this Section 11 shall not

constitute an Event of Default with respect to the Bonds. If the City fails to comply herewith, any

Bondholder or Beneficial Owner may take such actions as may be necessary and appropriate,

including seeking specific performance by court order, to cause the City to comply with its

obligations hereunder.

APPENDIX D

FORM OF OPINION OF BOND COUNSEL

[Letterhead of Kutak Rock LLP]

September __, 2013

City Council of the City

of Omaha, Nebraska

Omaha/Douglas Civic Center

1819 Farnam Street

Omaha, NE 68183

$24,970,000 CITY OF OMAHA, NEBRASKA

Various Purpose and Refunding Bonds Series 2013A

Ladies and Gentlemen:

We have acted as Bond Counsel in connection with the issuance and sale by the City of Omaha

(the “City”), a municipal corporation in the State of Nebraska, of $24,970,000 aggregate principal amount

of Various Purpose and Refunding Bonds, Series 2013A (the “Bonds”). The Bonds are issuable as fully

registered Bonds without coupons dated as of their date of delivery in the denomination of $5,000 or any

integral multiple thereof, bearing interest payable semiannually on May 15 and November 15 of each

year, commencing May 15, 2014, at the rates per annum set forth in the schedule below.

The Bonds mature serially in numerical order on November 15, in each of the years and in the

principal amounts as follows:

Various Purpose and Refunding Bonds, Series 2013A

Maturity

Date

(November

15)

Principal

Amount

Interest

Rate

Maturity Date

(November 15)

Principal

Amount

Interest

Rate

2014 $2,720,000 3.000% 2024 $715,000 4.000% 2015 3,460,000 3.000 2025 715,000 4.000 2016 2,780,000 3.000 2026 715,000 3.500 2017 1,550,000 2.750 2027 715,000 5.000 2018 1,245,000 2.000 2028 715,000 4.500 2018 250,000 3.000 2029 715,000 4.500 2019 1,525,000 3.000 2030 715,000 4.625 2020 1,415,000 4.000 2031 715,000 4.750 2021 1,445,000 4.000 2032 715,000 4.750 2022 715,000 4.000 2033 715,000 4.250 2023 715,000 4.000

The Bonds maturing November 15, 2024 and thereafter are subject to redemption at the option of

the City at any time on or after November 15, 2023, upon the terms and at the prices set forth therein.

The Bonds recite that they are issued by the City to provide for payment of the cost of certain streets and

highways, sewers, public facilities, public safety equipment, parks and recreation facilities and to

currently refund certain indebtedness of the City under and pursuant to and in full conformity with the

D-2

Constitution and Statutes of the State of Nebraska and the Charter of the City, and pursuant to and in full

compliance with the proceedings of the City Council of the City duly enacted and adopted.

The City has covenanted in the ordinance pursuant to which the Bonds have been issued to

comply with all necessary provisions of the Internal Revenue Code of 1986, as amended (the “Code”), to

preserve the exclusion of interest on the Bonds from gross income for federal income tax purposes.

Noncompliance by the City with such restrictions may cause the interest on the Bonds to be subject to

federal income taxation retroactive to their date of issue.

We have examined the Constitution and Statutes of the State of Nebraska, the Charter of the City,

certified copies of proceedings of the City Council of the City authorizing the issuance of the Bonds, and

an executed bond of said issue.

In our opinion the Bonds have been authorized and issued in accordance with the Constitution

and Statutes of the State of Nebraska and the Charter of the City, and constitute valid and legally binding

obligations of the City, and the City has the power and is obligated to levy ad valorem taxes for the

payment of the Bonds and the interest thereon upon all the property within the City subject to taxation by

the City without limitation as to rate or amount.

The rights of the owners of the Bonds and the enforceability thereof may be subject to valid

bankruptcy, insolvency, reorganization, moratorium and other laws for the relief of debtors.

It is also our opinion that, assuming compliance by the City with the covenant referred to in the

fourth paragraph of this letter, the interest on the Bonds (including any original issue discount treated as

interest) is excludable from gross income for federal income tax purposes and is not a special preference

item for purposes of the federal alternative minimum tax imposed on individuals and corporations.

Interest on the Bonds, however, must be included in the “adjusted current earnings” of certain

corporations (i.e., alternative minimum taxable income as adjusted for certain items, including those items

that would be included in the calculation of a corporation’s earnings and profits under Subchapter C of

the Code) and such corporations are required to include in the calculation of alternative minimum taxable

income 75% of the excess of each such corporation’s adjusted current earnings (which includes

tax-exempt interest) over its alternative minimum taxable income (determined without regard to this

adjustment and prior to reduction for certain net operating losses).

The accrual or receipt of interest on the Bonds may otherwise affect the federal income tax

liability of the recipient. The extent of these other tax consequences will depend upon the recipient’s

particular tax status or other items of income or deduction. We express no opinion regarding any such

consequences. Purchasers of the Bonds, particularly purchasers that are corporations (including

S corporations and foreign corporations operating branches in the United States), property or casualty

insurance companies, banks, thrifts or other financial institutions, certain recipients of Social Security or

Railroad Retirement benefits, taxpayers otherwise entitled to claim the earned income credit or taxpayers

who may be deemed to have incurred (or continued) indebtedness to purchase or carry tax-exempt

obligations are advised to consult their tax advisors as to the tax consequences of purchasing or holding

the Bonds.

It is further our opinion that, under the existing laws of the State of Nebraska, interest income on

the Bonds is exempt from Nebraska state income taxation as long as it is exempt for purposes of the

federal income tax.

Very truly yours,

[To be signed and delivered at closing by

Kutak Rock LLP]

APPENDIX E

SCHEDULE OF REFUNDED BONDS

Douglas County Sanitary and Improvement District No. 330 (Summergreen Estates)

General Obligation Refunding Bonds, Series 2003

Dated January 15, 2003

Maturity

(January 15) Amount Interest Rate

CUSIP

(259283)

2014 $75,000 4.45% FK0

2015 80,000 4.60 FL8

2016 85,000 4.70 FM6

2017 90,000 4.80 FN4

City of Omaha, Nebraska

General Obligation Refunding Bonds

Series of 2003

Dated March 1, 2003

Maturity

(November 1) Amount Interest Rate

CUSIP

(681712)

2014 $1,880,000 5.00% NV3

2015 2,610,000 5.00 NW1

2016 1,975,000 5.00 NX9

2017 790,000 4.00 NY7

2021 3,310,000 4.30 NZ4