wayne county financial report

8/9/2019 Wayne County Financial Report

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Project Myers

Confidential Draft Document

Work in process for discussion purposes only

January 2015


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Page 1

EY Disclaimer

Information contained herein has not been independently verified and is subject to material change based on continuing review.Accordingly, the information contained herein is not intended to be and should not be relied upon as legal, auditing or accountingadvice.

The assumptions and underlying data were produced by the Charter County of Wayne (the County) and its management(Management) and consist of information obtained solely from the County or publicly available resources. With respect to prospectivefinancial information received from the County, this information was not examined, compiled and agreed upon procedures were notapplied to such information in accordance with attestation standards established by the AICPA and no assurance of any kind isexpressed on the information presented. It is the Countys responsibility to make its own decision based on the information available toit.

Management has the knowledge, experience and ability to form its own conclusions. There will usually be differences between projected

and actual results because events and circumstances frequently do not occur as expected and those differences may be material. Noresponsibility is taken for the achievement of projected results. Accordingly, reliance on this report is prohibited by any third party asthe projected financial information contained herein is subject to material change and may not reflect actual results.

Pension results are highly sensitive to underlying assumptions. To the extent the assumptions change and/or the experience differsfrom the assumptions the projection will change. Pension projections are illustrative and should not be used or relied upon WayneCounty or any other party for budgeting or any other financial purpose.


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Page 2WORKING DRAFTSubject to Material Change

Table of contents

Item Page(s) index

Executive Summary 3

Financial Outlook 12

Long-Term Obligations 16

Appendix 18


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Executive Summary


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Wayne Countys General Fund (GF) generated an average annual deficit of ~$50m (before DTRF transfers)during the last 3 years. The accumulated unassigned deficit balance is projected to be ($161m) in FY15 and($230m) in FY16 (absent transfers from DTRF) and continues to grow thereafter.

The operating deficits have primarily been caused by:

21% reduction in property tax revenues between FY 2009 and FY 2014, for an average annual decline of 4.5%

Significant legacy expenditures, approaching $100m annually driven by an unsustainable defined benefit pension plan and continuedhealthcare inflation

Historical and forecasted budget overruns in the Sheriff and Prosecutors Office

The County has attempted to address the deficits through the implementation of cost cutting initiatives including salary reductions,healthcare benefits changes, and headcount reductions, but this has not been sufficient to prevent continued deficit growth

Recently, the GF has relied more heavily on transfers from the Delinquent Tax Revolving Fund (DTRF) to fund operating deficits, which hasseen increased activity/surplus as a result of the unusually high volume of foreclosure activity in recent years.

Wayne Countys current financial condition is not sustainable in the long-term given thesizeable General Fund structural fiscal deficit

Historical and forecasted revenues, expenses, and general fund balance

Note: FY12A and FY13A balances areper respective year CAFR, FY14-FY16per Department of Management andBudget monthly cash flow forecastmodel, FY17-FY19 based on historicaltrends.


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The Countys liquidity is seasonal, with the majority of property taxes being collected in the fall of each year (high point inSeptember). During the Spring, liquidity is usually at its low point, and the County issues TANs to shore up liquidity.

Declining pooled cash balance: The lowest liquidity point for FY14 pooled cash was $22m in February 2014.

FY15 pooled cash is expected to reach a risk adjusted low point in August 2015 of $35m, breach a 5% cash contingencybalance in May 2016, and reach negative liquidity by June 2016.

Declining General Fund cash position: The GF position in pooled cash was ($49m) as of September 2014. The GF positionin pooled cash is expected to decline to as low as ($147m) in 2015 and ($143m) in 2016 if potential identified risks arerealized.

Despite transfers from DTRF to eliminate the GF deficit, the Countys liquidity position will continue to deteriorate in thenext 12 to 24 months without further action.

Historical and forecasted General Fund and general pooled cash position

The GF cash position is expected to be negative in the next 2 years. Pooled cash is expectedto decline and a liquidity crisis could materialize as early as August 2015

Note: Risk adjustments are preliminary and require further review.


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Historical FY15-FY19

$ in millions 2014A 2015P 2016P 2017P 2018P 2019P Cumulative

General Fund revenues 539.5 495.4 488.4 488.6 496.7 508.3 2,477.4

General Fund expenditures (478.5) (476.1) (464.7) (474.8) (485.1) (495.7) (2,396.5)GF Operating surplus/(deficit) 60.9 19.3 23.7 13.8 11.6 12.6 80.9

Legacy expenditures

Pension (44.1) (41.2) (41.7) (42.0) (42.8) (43.7) (211.3)

Hospitalization - Retiree (25.4) (29.2) (32.0) (33.6) (35.3) (37.0) (167.0)

Total Debt Service (12.2) (21.5) (19.8) (19.8) (19.8) (19.8) (100.6)

GF legacy expenditures (81.7) (91.9) (93.4) (95.3) (97.8) (100.5) (479.0)

Potential risk adjustments - (12.9) (14.8) (15.0) (15.3) (15.5) (73.5)

Issue/(Repayment) of TANs and other cash activity (9.9) (35.3) - - - - (35.3)

GF cashflow before DTRF (30.6) (120.8) (84.5) (96.6) (101.5) (103.4) (506.8)Delinquent Tax Revolving Fund transfer1 92.1 152.7 39.5 33.3 30.9 29.7 286.1

General fund cash flow after DTRF transfer 61.5 31.9 (45.1) (63.3) (70.6) (73.7) (220.7)

Non-general fund cash activity - Sources/(Uses)

Non-General Fund cash activity (22.8) (34.4) (34.2) (20.7) (20.7) (20.7) (130.7)

Delinquent Tax Revolving Fund 101.3 (78.2) - - - - (78.2)

Other 9.1 (18.5) - - - - (18.5)

Mental Health withdrawal from pool % (16.4) 10.0 (16.0) (16.0) - - (22.0)

Non-General Fund cash activity2 71.2 (121.1) (50.2) (36.7) (20.7) (20.7) (249.4)

All funds cash flow 132.7 (89.2) (95.3) (100.0) (91.3) (94.4) (470.1)

General pooled cash - beginning balance2 113.3 246.0 156.8 61.6 (38.4) (129.7) 246.0

Remaining General Pooled Cash $246.0 $156.8 $61.6 ($38.4) ($129.7) ($224.1) ($224.1)

County Projections Illustrative Trends

Note: (1) $78m in DTRF transfers pending approval to be effective Mar15, (2) Excludes Trust and Agency cash activity and balance.

Risk adjusted net cash flow is forecasted to be negative each year during the forecast period, causing general pooled cash afterTrust and Agency balance to be negative in FY16 through FY19. Restructuring alternatives should be evaluated and implemented to right-size forecasted expenditures to a level appropriate for

forecasted revenues.

Legacy liabilities/expenses shouldbe restructured tohelp mitigate apotential negativecash position

5 year cash flow forecast summary

Preliminary 5 year cash flow projections based on current trends indicate significant cashburn absent drastic budget cuts or significant changes to legacy liabilities


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$276

$495

($29)

$72

$147($121)

($92)

($64)

($131)

($68)

($41)

($21)

$153 ($13)

($200)

($100)

$0

$100

$200

$300

$400

$500

$600

The General Funds FY15 projected deficit before transfers from DTRF is $73m. Legacy expenditures for the year areprojected to be $92m

Total General Fund operating revenues are forecasted to be $495 million in FY15. These revenues are appropriated for the followingdepartmental and non-departmental uses, totaling $568 million.

Revenues Tax revenues Grants and

contracts Other

operating andfinancingrevenues

Key businessunits: County Jail Court

Services Executive

Division Roads

Circuit Court Attorney fees Grant to

circuit courtthroughGeneral Fund

Other operating expenditures Juvenile Justice - $64m Other departmental - $131m

(includes: Management andBudget, County Clerk, Health andHuman Services, among others)

Other non-departmental - $68m(Includes: building rentalsexcluding jail related, MentalHealth Authority, OperatingTransfers Out to primaryoperating funds)

Legacy expenditures (for GF and GFsubsidized funds)Pension Normal cost and UAAL amortizationRetiree Medical Benefits Pay as you go disbursements onlyDebt Service Includes jail debt service of $14m*Note: legacy expenditures also includecertain expenditures of non-GFs which aresubsidized by the GF through operatingtransfers.

DTRF transfer Transfer to General Fund to

address annual deficitPotential risks Increased expenditures:

Increased pension contribution($5m), 1% expenditurecontingency ($6m), otheroperating variances ($2m)

Legacy Expenditures ($92m)

GF revenues are sufficient to cover operating expenditures. However, a significant level oflegacy expenses result in annual GF deficits of $50-100m

Requires Additional Review


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The Countys defined benefit pension plan is severely underfunded, and could continue to bede-funded absent major changes to accrued benefits

The Countys defined benefit pension plan is severelyunderfunded and are a significant burden on the Countysfinancial condition.

The funding level is 44% for County retirees and 58% for

airport Total UAAL was $896M as of the 9/30/2013 valuation

This valuation results in the Countys required pensioncontributions to be very significant as a percentage of activewages

County contribution is 48.6% of payroll, mostly driven by ahigh UAAL amortization (41.3%)

On average, for each active employee, the County has to

contribute $30k to the pension plan Average member contribution rate is ~4.3% of pay which is

on the low side compared to other plans.

The County is considering changes to future accrued benefits.

These changes require bargaining with the unions, which insome cases have language protecting them from any pensionchanges until 2020.

The likelihood of success for changes to future accrued

benefits is very low given the bargaining requirement toimplement them.

Wayne County Defined Benefit Plans(1)

(9/30/2013)

County(2) Airport Total

Participants

Active employees 2,055 366 2,421Retirees 5,308 186 5,494

Total 7,363 552 7,915

Ratio Active/Retiree 0.39 1.97 0.44

Active payroll ($m) 125.5$ 26.4$ 151.9$

Average pay/EE ($k) 61.1$ 72.2$ 62.7$

Retiree benefits paid ($m) 123.7$ 7.7$ 131.4$

Average pay/retiree ($k) 23.3$ 41.5$ 23.9$

Balance sheet

Actuarial asset value ($m) 672.3$ 76.2$ 748.5$

Actuarial accrued liab ($m) (1,512.8) (132.0) (1,644.8)

UAAL ($m) (840.6)$ (55.8)$ (896.3)$

Percent Funded 44.4% 57.8% 45.5%

FY 2014 Contribution

Normal 11.6% 6.7% 10.8%

UAAL 41.3% 18.8% 37.3%

POAM Member Rate Adj.

EE Contrib -4.3% -0.7% -3.6%

Total % 48.6% 24.7% 44.5%

County contribution1($m) 61.7$ 7.2$ 68.9$

County contribution/active ($k) 30.0$ 19.8$ 28.5$

Notes:

1.

2.

Information based on the Sept 2013 Gabriel Roeder Smith actuarial valuation for

Wayne County

The MHA separated in 2013 but members continue to accrue service to 10/1/2014.

The analysis above for the County includes the MHA.


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Pension underfunding has deteriorated and illustrative projections (*) indicate funding coulddrop to 39% by 2023 under reasonable assumptions and current contribution levels

The plans funded status has deteriorated from 95% to 45% from2004 to 2013. Key reasons for this decline include:

Ability to purchase years of unearned service at a discount forsome plan members

Retirement incentives which waived the retirement agerequirement

Plans were reopened and had an influx of members beginning in2002 for Plan 5 members and 2008 for Plan 6 members

Retiree payroll increased by 48% from $88.7m in 2004 to$131.4 in 2013

Average pension increased 51% from $15,851 per year in 2004to $23,914 in 2013

County used an offset from the Inflation Equity Fund in lieu of itscontributions in 2011 and 2012

Plan did not achieve investment returns for multiple periods

Plan funding could drop to 39% by 2023 under the followingassumptions:

Assumed rate of return and discount rate of 6.75% (1% lowerthan current valuation rate)

2% payroll growth and 2% benefit payment growth

Employer contributions maintained at 48.9% of payroll

Based on Market Value of Assets

No other actuarial gains or losses or design changes

These results are high level illustrative projections and shouldnot be used by or relied upon Wayne County or any other partyfor budgeting or any other financial purpose

Illustrative projections assuming 49%contributions and 6.75% rate of return

Illustrative projections assuming 49%contributions plus $40m a year for 10 yearsand 6.75% rate of return

(*)These are high level illustrative projections based on the 2013 valuation report and should not be used by or relied upon Wayne County or any other party for budgetingor any other financial purpose. Funding levels as of 2013 differ from the Gabriel Roeder Smith Report due to the use of a lower rate of return and discount rate.

In order to restore funding levels to 70% by 2023, the County would need to contribute an additional $40m annually for thenext 10 years, assuming a 6.75% rate of return.


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Current Situation Observations

StructuralGF Deficit

Ending FY13 General Fund accumulated deficit of$159 million

General Fund liquidity is negative and highly

dependent on DTRF transfers-in Recent use of TANs to generate necessary liquidity

for operations General Fund generates annual structural deficit of

$50m to $70m

Potential for further deficits despite significant expenditure cuts Property taxes likely to have limited to no growth given Detroit

reassessment process OPEB payments likely to grow in the future absent further actions Potential additional debt service from jail project needs to be

considered

Pension UAAL currently at $850m based on Market Value Downward trending funded status of pension plan

around 50% funding level, declining every year since2001

Contributions as a percentage of wages are

approximately 50% Certain bargaining units have language protecting

them from further changes

Pension assets will become insufficient to cover retiree benefitsabsent an acceleration of UAAL amortization, which would result insignificant additional contributions (currently at 50% of wages)

Changes to future accruals need to be achieved through bargainingand therefore the probability of success is low

Changes to future accruals, even if achieved, will not addresssignificant plan underfunding

DTRF The County transferred a total of $92 million fromthe DTRF into the General Fund in FY 2014: $82m of equity $10m of excess auction proceeds

DTRF available transfers projected to decrease: $74.5m in FY15 (additional $78m pending approval) $39.5m in FY16 and declining transfer amounts to $29.7m in

FY19 DTRF transfers should be used only as a bridge to financial

sustainability, not as a fix to the General Fund structural deficit

JailProject

The County has spent approximately $150m of the$200m raised in bonds to fund the construction ofthe jail project

Currently contemplating the issuance of anadditional $170m to address cost overruns

Additional debt expected to increase debt service burden byapproximately $20m annually

Alternative of repairing existing facilities would require significantfunding that the County cannot afford

Sheriffsbudget

Sheriffs department operating variances, primarilyrelated to additional headcount requirements at the

jail, had an operating variance of $29.5m in FY13.

Sheriffs department operating variances are projected to be$12m - $15m annually, absent efficiencies gained from the jailproject

The County faces significant issues that will need to be addressed in the short term toensure the long-term financial stability of the County


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Financial Outlook


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The Countys budget may not reflect the most conservative scenario ofcash flow activity. Accordingly, the following key risks were identifiedto reflect a more conservative view of liquidity for FY15 and FY16:

Increased pension contribution from 48.62% to 56.17% due to anaccelerated amortization period of 20 years ~$5m annually

Increase incremental pension contribution to avoid defundingTBD

Anticipated budget overruns increased overtime and wagesrelated to the Prosecutor and other departments of $2m to $4mannually(Note: $15m of risk related to Sheriff overtime andincreased salaries and wages have been included in projections)

No new issue of TANs, which affects timing of cash flows, as theCounty is projecting to issue $75m in TANs from March throughMay and repay $75m from April through September

General pooled cash could reach a low of $35m in August 2015 andreach a negative cash position by June 2016 if the aforementionedrisks are realized. Should any additional risks be realized in FY15 (e.g.delay in property tax receipts, additional departmental overages,etc.), then cash may reach a negative balance in FY15 or earlier inFY16.

Near-term liquidity risks

24 month forecast cash pool risks overview


$ in millions FY15 FY16

Property Tax $275.7 $268.5

Other revenues 219.7 219.9

General Fund Revenue 495.4 488.4

Operating expenditures (476.1) (464.7)Legacy expenditures (91.9) (93.4)

General Fund expenditures (568.0) (558.1)

Receipt of TANs 75.0 75.0

Other Sources/(Uses) 6.0 -

Property Tax TAN Repayment Reserve (116.3) (75.0)

Issue/Repayment of TANs and other cash activity (35.3) -

Revenues less expenditures and other cash activity (107.9) (69.7)

Potential risks to General Fund: 1

Increased pension contribution per actuaries (5.2) (5.3)

Incremental pension contribution to avoid def unding [TBD] [TBD]

Anticipated operating variances (2.0) (3.9)

Contingency (1% of expenditures) (5.7) (5.6)

No new TANs issued - -

Potential Adjustments to General Fund (12.9) (14.8)

General fund cash flow before DTRF (120.8) (84.5)

DTRF transfer 152.7 39.5

Potential General Fund cash flow activity 31.9 (45.1)

Cash (Us e) / Source - Non-General Fund (34.4) (34.2)

Delinquent Tax - net (use)/source (78.2) -

Other (Uses )/Sources (18.5) -

Mental Health withdrawal from pool % 10.0 (16.0)

Non-General Fund and other cash activity2 (121.1) (50.2)

Potential net cash flow activity ($89.2) ($95.3)

Beginning pooled cash with risks 246.0 156.8

Ending pooled cash before risks2 169.7 89.2

Risk adjusted ending pooled cash 2 156.8 61.6

Negative cash position period (month) n/a Jun - Aug

Cash low point $35.1 ($20.3)

Note: (1) $15m in risk related to Sheriff overtime and increased salaries and wages included in

forecast, (2) Excludes Trust and Agency activity and balance.

G i d d fi it h b fit d f t f li i j ti


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Actual

$ in millions 2014 2015 2016 2017 2018 2019

Revenues1 $539.5 $495.4 $488.4 $488.6 $496.7 $508.3 $2,477.4

Expenditures and other fund activity2 (560.2) (568.0) (558.1) (570.1) (583.0) (596.2) (2,875.4)

Ending surplus/(deficit) before adjustments (20.8) (72.6) (69.7) (81.6) (86.2) (87.9) (398.0)

Adjustments to budget

Increased pension contribution per actuaries - (5.2) (5.3) (5.4) (5.5) (5.6) (26.9)

Incremental pension contribution to avoid defunding - [TBD] [TBD] [TBD] [TBD] [TBD] [TBD]

Anticipated operating variances - (2.0) (3.9) (3.9) (3.9) (3.9) (17.8)Contingency (1% of expenditures) - (5.7) (5.6) (5.7) (5.8) (6.0) (28.8)

Subtotal Adjustments to budget 0.0 (12.9) (14.8) (15.0) (15.3) (15.5) (73.5)

General Fund surplus/(deficit) before DTRF (20.8) (85.5) (84.5) (96.6) (101.5) (103.4) (471.5)

DTRF operating transfer 92.1 152.7 39.5 33.3 30.9 29.7 286.1

Potential GF surplus/(defict) 71.4 67.2 (45.1) (63.3) (70.6) (73.7) (185.4)

Beginning unassigned deficit3 (159.5) (88.1) (20.9) (65.9) (129.2) (199.8) (88.1)

GF surplus/(deficit) 71.4 67.2 (45.1) (63.3) (70.6) (73.7) (185.4)

Risk adjusted ending unassigned deficit ($88.1) ($20.9) ($65.9) ($129.2) ($199.8) ($273.5) ($273.5)

Projected Illustrative trends Total

FY15-FY19

Note: (1) Includes GF transfers in, and (2) includes GF transfers out and special items, (3) FY14 beginning unassigned deficit per FY13 CAFR.

The GF structural deficit before consideration of risk adjustments could reach $398m for the FY15-FY19 5-year period.

The General Fund unassigned deficit may continue to grow if significant changes are not made to the Countys cost

structure.

The risk adjusted GF unassigned deficit could reach ($274m) by 2019.

GF unassigned deficit has benefited from DTRF transfers. However, preliminary projectionsbased on current trends indicate a potential shortfall of $274 million in the next 5 years



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Long-Term Obligations


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Governmental ActivitiesDebt25%

Business Type ActivitiesDebt5%

Pension - County30%

OPEB40%

Total Primary Government Long Term Obligations

Summary of Long Term Obligations

Primary Government long-term obligations have decreased in 2014 as a result of the changes in retiree healthbenefits, which resulted in a reduction of the OPEB UAAL.

Summary of Long Term Obligations

$ in millions 2013 2014

YoY

change

Governmental Activities Debt $718 $732 $14

Business Type Activities Debt $165 $153 ($12)

Total Primary Government Debt $883 $885 $3

Pension - County $825 $854 $29

OPEB $1,569 $1,334 ($235)

Total Primary Government Long Term Obligations $3,277 $3,074 ($203)

Component Unit Debt $2,268 $2,311 $43

Pension - Airport $53 $56 $3

Total Component Unit Long Term Obl igations $2,321 $2,367 $46

Total Wayne County Long Term Obligations $5,598 $5,441 ($157)

Source: Debt Rollforwards, 2013 Annual Actuarial Valuation Report, 2014 GASB 45 Ac tuarial Valuation.

Note: 2014 Pension valuation was not available. County Pension value includes the Mental Health Authority.


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Appendix


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FY14 cash flow detail

$ in millions Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Total

Revenues

Property Tax Collection $34.3 $7.1 $1.7 $30.4 $23.2 $21.1 $10.4 $6.1 $16.1 $12.3 $20.4 $99.5 $282.5

Grants and Contracts 10.1 8.2 11.4 5.9 9.5 4.1 12.6 0.2 6.9 3.7 10.5 2.4 85.6

Other Revenue 6.9 9.5 9.1 13.1 8.7 11.9 14.0 10.6 11.2 11.6 21.6 43.2 171.4

GF Operating Revenue 51.3 24.8 22.1 49.4 41.4 37.0 37.0 17.0 34.2 27.6 52.6 145.0 539.5

Revenue growth % -69.4% -51.6% -11.0% 123.4% -16.1% -10.6% -0.1% -54.2% 101.7% -19.2% 90.3% 175.9% 0.5%

Operating Expenditures

Personnel

Salaries and Wages 10.8 8.8 9.0 10.1 7.8 9.1 8.4 10.4 8.1 10.6 8.0 6.7 107.9

Overtime 1.8 1.0 0.7 1.8 1.0 1.2 1.4 1.3 1.5 1.7 1.6 1.4 16.5

Total Personnel 12.6 9.9 9.8 11.8 8.8 10.3 9.8 11.8 9.6 12.3 9.6 8.1 124.4

Fringe Benefits

Hospitalization - Active 1.8 1.1 1.9 1.7 1.6 1.7 1.7 0.2 1.8 1.7 1.7 4.1 20.8

Other Fringe Benefits 1.1 0.9 0.9 1.1 0.9 0.9 1.0 1.1 0.9 1.1 0.9 0.6 11.3

Total Fringe Benefits 2.9 2.0 2.8 2.8 2.4 2.7 2.6 1.2 2.7 2.8 2.6 4.7 32.2

Operating T ransfers Out

Juvenile Justice 4.4 4.4 4.4 4.4 4.4 4.4 4.4 11.7 5.3 5.3 5.3 5.3 63.7

Grant To Circuit Court 9.8 4.6 4.6 9.8 4.6 4.6 9.8 4.6 4.6 9.8 4.6 4.6 76.0

Other Operating Transfers Out 0.0 0.4 (0.0) 0.1 6.1 0.0 1.2 2.0 1.2 1.3 1.2 17.2 30.7

Operating Transfers Out - Total 14.2 9.4 9.0 14.2 15.1 9.0 15.4 18.3 11.1 16.4 11.2 27.1 170.4

Other Operating Expenditures

Services and Contractual Serv 4.7 4.8 5.1 7.3 5.9 4.4 9.5 4.0 4.2 4.7 3.6 11.8 70.0

Other operating expenses 6.6 4.1 6.6 5.1 7.2 9.6 5.2 5.0 5.7 4.7 7.8 13.9 81.6

Total Other Operating Expenditures 11.3 8.9 11.7 12.4 13.2 14.0 14.7 9.0 9.9 9.4 11.4 25.7 151.6

Total operating expenditures 41.0 30.2 33.2 41.3 39.5 35.9 42.5 40.3 33.3 40.9 34.8 65.5 478.5

% of revenue 79.9% 121.4% 150.4% 83.6% 95.5% 97.1% 115.0% 237.8% 97.4% 148.0% 66.1% 45.2% 88.7%

Legacy Expenditures

Pension 4.3 3.5 3.5 4.2 3.1 3.7 3.5 3.6 3.6 3.7 3.6 3.7 44.1

Hospitalization - Retiree 2.2 1.4 2.4 2.2 2.0 2.1 2.1 0.2 2.3 2.1 2.1 4.3 25.4

Total Debt Service 0.1 0.0 - - - 3.5 0.4 5.5 - 0.8 0.1 1.8 12.2

Total Legacy Expenditures 6.6 4.9 5.9 6.4 5.1 9.3 6.0 9.4 5.9 6.7 5.8 9.7 81.7

GF Expenditures 47.6 35.1 39.1 47.7 44.6 45.3 48.6 49.7 39.2 47.5 40.6 75.3 560.2

GF Surplus / (Deficit) before DTRF and risks 3.8 (10.2) (17.0) 1.7 (3.2) (8.3) (11.6) (32.8) (5.0) (19.9) 12.0 69.7 (20.8)

GF cumulative unassigned deficit before DTRF transfer and risks (155.7) (165.9) (183.0) (181.3) (184.5) (192.7) (204.3) (237.1) (242.1) (262.0) (250.0) (180.3) (180.3)

Actual


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Non P&L Cash activity

Receipt of TANs - - - - - - - 25.0 - 25.0 25.0 - 75.0

Other Sources/(Uses) (0.7) (1.5) 6.1 (13.5) 7.0 (10.5) 17.7 (2.0) (5.9) 6.5 (17.3) 9.3 (4.7)

Property Tax TAN Repayment Reserve (46.5) - - - - - - - - (1.7) (9.5) (22.5) (80.2)

Non P&L Net cash flow (47.2) (1.5) 6.1 (13.5) 7.0 (10.5) 17.7 23.0 (5.9) 29.8 (1.8) (13.2) (9.9)

Potential risks

Increased pension contribution per actuaries - - - - - - - - - - - - -

Incremental pension contribution to avoid defunding - - - - - - - - - - - - -

Anticipated operating variances - - - - - - - - - - - - -

Contingency (1% of expenditures) - - - - - - - - - - - - -

No new TANs issued - - - - - - - - - - - - -

Subtotal Potential Risks - - - - - - - - - - - - -

General Fund - Net cash flow before DTRF (43.4) (11.8) (10.9) (11.8) 3.8 (18.8) 6.2 (9.8) (10.9) 9.9 10.2 56.6 (30.6)

Risk adjusted GF position in pooled cash before DTRF (153.7) (165.5) (176.3) (188.1) (184.3) (203.1) (196.9) (206.7) (217.6) (207.7) (197.5) (140.9) (140.9)

DTRF operating transfer to GF - - - - - - - - 82.2 - - 9.9 92.1GF - Net cash flow with DTRF (43.4) (11.8) (10.9) (11.8) 3.8 (18.8) 6.2 (9.8) 71.3 9.9 10.2 66.5 61.5

Risk adjusted cumulative GF unassigned deficit with DTRF (155.7) (165.9) (183.0) (181.3) (184.5) (192.7) (204.3) (237.1) (159.8) (179.8) (167.7) (88.1) (88.1)

Risk adjusted GF balance in pooled cash with DTRF (153.7) (165.5) (176.3) (188.1) (184.3) (203.1) (196.9) (206.7) (135.3) (125.4) (115.2) (48.8) (48.8)

Non-General Fund cash activity

Cash (Use) / Source - Non-General Fund (18.4) (22.6) 0.1 (10.3) (14.5) 14.0 19.6 8.4 3.3 3.5 (9.4) 3.6 (22.8)

Delinquent Tax - net (use)/source 32.4 7.3 2.6 (0.2) 6.4 16.3 1.0 (18.1) 57.1 (13.4) 11.2 (1.3) 101.3

Other (Uses )/Sources 2.8 7.4 10.9 (1.5) (3.4) (10.4) 13.4 (13.9) 13.8 5.8 (13.4) (2.5) 9.1

Mental Health withdrawal from pool % - (16.4) - - - - - - - - - - (16.4)

Non-General Fund - Cash Sources/(Uses) 16.8 (24.3) 13.6 (12.0) (11.5) 19.8 34.0 (23.6) 74.1 (4.1) (11.6) (0.1) 71.2

All funds - Net cash flow (26.7) (36.0) 2.8 (23.8) (7.7) 1.1 40.2 (33.4) 145.5 5.8 (1.4) 66.3 132.7

General pool cash - beginning balance 113.3 86.6 50.6 53.3 29.5 21.8 22.9 63.1 29.8 175.2 181.1 179.7 113.3

Remaining General Pooled Cash $86.6 $50.6 $53.3 $29.5 $21.8 $22.9 $63.1 $29.8 $175.2 $181.1 $179.7 $246.0 $246.0Source: Department of Management & Budget

Actual

FY14 cash flow detail(continued)

Note: excludes Trust and Agency activity and balance.



21/31


FY15P cash flow detail

Actual


Revenues


Grants and Contracts 8.1 5.2 8.8 2.8 8.2 1.0 12.3 0.7 8.5 4.4 12.3 (0.2) 72.3

Other Revenue 8.4 11.4 9.8 13.2 10.4 11.4 13.3 9.3 12.6 13.2 16.0 18.3 147.5


Revenue growth % -72.2% -22.5% -35.0% 131.4% -10.0% -19.8% 6.7% -55.4% 132.3% -19.6% 63.1% 125.3% -21.6%


Personnel


Overtime 1.6 1.4 0.8 2.0 1.3 1.4 1.6 1.5 1.6 1.8 1.7 1.4 18.1

Total Personnel 11.3 11.2 9.8 11.7 9.1 10.4 10.1 10.5 10.2 10.8 10.5 10.8 126.3

Fringe Benefits




Operating Transfers Out



Other Operating Transfers Out 1.2 1.9 1.9 1.9 1.9 1.9 1.9 1.9 1.9 1.9 1.9 1.9 21.9







% of revenue 92.1% 131.5% 190.1% 86.5% 90.9% 115.3% 107.7% 242.0% 89.6% 136.7% 79.5% 44.0% 96.1%

Legacy Expenditures

Pension 3.4 3.7 3.5 3.5 3.1 3.5 3.4 3.5 3.4 3.5 3.5 3.3 41.2


Total Debt Service 2.9 9.0 0.2 0.2 0.2 0.3 0.3 0.2 5.5 0.7 0.7 1.3 21.5


GF Expenditures 44.8 56.0 45.0 47.0 44.3 45.5 45.2 45.4 45.0 47.9 45.9 55.9 568.0

GF Surplus / (Deficit) before DTRF and risks (4.5) (24.7) (24.7) 0.1 (1.9) (11.5) (9.0) (29.3) (7.5) (17.8) 3.3 54.8 (72.6)


Forecast


22/31


Actual




Receipt of TANs - - - - - 25.0 25.0 25.0 - - - - 75.0

Other Sources/(Uses) 6.0 - - - - - - - - - - - 6.0

Property Tax TAN Repayment Reserve (41.3) - - - - - (7.7) (4.5) (11.9) (9.0) (15.1) (26.8) (116.3)

Non P&L Net cash flow (35.3) - - - - 25.0 17.3 20.5 (11.9) (9.0) (15.1) (26.8) (35.3)

Potential risks

Increased pension contribution per actuaries - (0.5) (0.5) (0.5) (0.4) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (5.2)

I ncremental pension contribution to avoid def unding - [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD]

Anticipated operating variances - (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (2.0)

Contingency (1% of expenditures) - (0.6) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (0.6) (5.7)

No new TANs issued - - - - - (25.0) (17.3) (20.5) 11.9 9.0 15.1 26.8 -

Subtotal Potential Risks - (1.3) (1.1) (1.2) (1.1) (26.2) (18.5) (21.7) 10.7 7.9 14.0 25.6 (12.9)

General Fund - Net cash flow before DTRF (39.8) (26.0) (25.8) (1.1) (3.0) (12.7) (10.1) (30.4) (8.6) (19.0) 2.2 53.6 (120.8)


DTRF operating transfer to GF - - - - - 78.2 - - - - - 74.5 152.7GF - Net cash flow with DTRF (39.8) (26.0) (25.8) (1.1) (3.0) 65.5 (10.1) (30.4) (8.6) (19.0) 2.2 128.1 31.9




Cash (Use) / Source - Non-General Fund (0.7) (14.5) (10.2) (0.0) (4.4) (3.4) (1.3) (6.8) (8.5) (2.2) (6.6) 24.3 (34.4)

Delinquent Tax - net (use)/source 30.6 - - - - (78.2) - - - - - (30.6) (78.2)

Other (Uses)/Sources (18.5) - - - - - - - - - - - (18.5)

Mental Health withdrawal from pool % - 10.0 - - - - - - - - - - 10.0

Non-General Fund - Cash Sources/(Uses) 11.4 (4.5) (10.2) (0.0) (4.4) (81.6) (1.3) (6.8) (8.5) (2.2) (6.6) (6.3) (121.1)

All funds - Net cash flow (28.4) (30.6) (36.0) (1.1) (7.4) (16.1) (11.4) (37.2) (17.2) (21.1) (4.4) 121.8 (89.2)

General pool cash - beginning balance 246.0 217.6 187.0 151.1 149.9 142.6 126.5 115.0 77.8 60.7 39.5 35.1 246.0

Remaining General Pooled Cash $217.6 $187.0 $151.1 $149.9 $142.6 $126.5 $115.0 $77.8 $60.7 $39.5 $35.1 $156.8 $156.8

Source: Department of Management & Budget

Forecast

FY15P cash flow detail(continued)


Note: 1. Includes $78.2m of DTRF transfers to the GF which is pending approval, and 2. Excludes Trust and Agency activity and balance.


23/31


FY16P cash flow detail


Revenues


Grants and Contracts 8.3 4.2 8.9 2.7 8.3 1.0 12.2 0.7 8.5 4.2 12.5 0.8 72.3

Other Revenue 8.6 11.5 9.9 13.2 10.5 11.6 13.2 9.4 12.8 13.0 16.3 17.5 147.6


Revenue growth % -63.1% -25.0% -33.8% 125.3% -8.8% -20.2% 7.0% -55.5% 133.6% -21.3% 68.1% 123.1% -1.4%


Personnel


Overtime 0.4 0.4 0.2 0.6 0.4 0.4 0.5 0.5 0.4 0.5 0.4 12.9 17.6

Total Personnel 9.6 8.7 8.8 9.1 8.2 9.0 8.8 9.2 8.7 9.1 9.0 26.5 124.7

Fringe Benefits




Operating Transfers Out



Other Operating Transfers Out 1.3 1.9 1.8 1.8 1.9 1.8 1.9 1.8 1.9 1.8 1.8 1.9 21.8







% of revenue 86.9% 124.8% 180.9% 81.4% 87.6% 110.8% 103.4% 232.1% 84.3% 132.5% 74.9% 58.1% 95.1%

Legacy Expenditures

Pension 3.5 3.8 3.5 3.5 3.2 3.5 3.4 3.5 3.4 3.5 3.5 3.4 41.7


Total Debt Service 2.3 9.0 0.2 0.2 0.2 0.2 0.2 0.2 5.4 0.6 0.6 0.6 19.8


GF Expenditures 42.8 53.5 43.3 43.8 42.5 43.4 43.3 43.4 42.8 45.6 43.7 70.3 558.1

GF Surplus / (Deficit) before DTRF and risks (1.9) (22.8) (23.0) 2.0 (0.7) (10.2) (7.6) (27.5) (5.7) (16.4) 5.3 39.0 (69.7)


Forecast


24/31


FY16P cash flow detail(continued)


Note: Excludes Trust and Agency activity and balance.




Receipt of TANs - - - - - 25.0 25.0 25.0 - - - - 75.0

Other Sources/(Uses) - - - - - - - - - - - - -

Property Tax TAN Repayment Reserve - - - - - - (7.4) (4.4) (11.5) (8.8) (14.6) (28.3) (75.0)

Non P&L Net cash flow - - - - - 25.0 17.6 20.6 (11.5) (8.8) (14.6) (28.3) -

Potential risks

Increased pension contribution per actuaries (0.4) (0.5) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (5.3)

Incremental pension contribution to avoid defunding [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD]

Anticipated operating variances (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.4) (3.9)

Contingency (1% of expenditures) (0.4) (0.5) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.5) (0.4) (0.7) (5.6)


Subtotal Potential Risks (1.2) (1.3) (1.2) (1.2) (1.1) (26.2) (18.8) (21.8) 10.4 7.6 13.4 26.8 (14.8)

General Fund - Net cash flow before DTRF (3.1) (24.1) (24.2) 0.7 (1.9) (11.4) (8.8) (28.7) (6.9) (17.7) 4.1 37.5 (84.5)


DTRF operating transfer to GF - - - - - - - - - - - 39.5 39.5GF - Net cash flow with DTRF (3.1) (24.1) (24.2) 0.7 (1.9) (11.4) (8.8) (28.7) (6.9) (17.7) 4.1 76.9 (45.1)




Cash (Use) / Source - Non-General Fund (3.9) (10.7) (8.2) 2.9 (2.7) (1.6) 0.7 (4.7) (6.5) (0.1) (4.5) 4.9 (34.2)

Delinquent Tax - net (use)/source - - - - - - - - - - - - -

Other (Uses)/Sources - - - - - - - - - - - - -


Non-General Fund - Cash Sources/(Uses) (3.9) (26.7) (8.2) 2.9 (2.7) (1.6) 0.7 (4.7) (6.5) (0.1) (4.5) 4.9 (50.2)

All funds - Net cash flow (7.0) (50.9) (32.4) 3.7 (4.6) (12.9) (8.1) (33.4) (13.4) (17.7) (0.4) 81.9 (95.3)

General pool cash - beginning balance 156.8 149.8 99.0 66.5 70.2 65.7 52.7 44.6 11.2 (2.2) (20.0) (20.3) 156.8

Remaining General Pooled Cash $149.8 $99.0 $66.5 $70.2 $65.7 $52.7 $44.6 $11.2 ($2.2) ($20.0) ($20.3) $61.6 $61.6

Source: Department of Management & Budget

Forecast


25/31


FY15 cash risk detail


Actual

$ in millions Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 FY15

Property Tax $23.8 $14.7 $1.7 $31.0 $23.7 $21.5 $10.6 $6.2 $16.4 $12.5 $20.9 $92.7 $275.7

Other revenues 16.6 16.6 18.7 16.1 18.6 12.4 25.6 10.0 21.1 17.7 28.3 18.1 219.7General Fund Revenue 40.3 31.3 20.3 47.1 42.4 34.0 36.2 16.1 37.5 30.1 49.2 110.8 495.4

Operating expenditures (37.2) (41.1) (38.7) (40.7) (38.5) (39.2) (39.0) (39.1) (33.6) (41.2) (39.1) (48.7) (476.1)

Legacy expenditures (7.7) (14.9) (6.3) (6.3) (5.7) (6.3) (6.2) (6.3) (11.4) (6.8) (6.8) (7.2) (91.9)

General Fund expenditures (44.8) (56.0) (45.0) (47.0) (44.3) (45.5) (45.2) (45.4) (45.0) (47.9) (45.9) (55.9) (568.0)

Receipt of TANs - - - - - 25.0 25.0 25.0 - - - - 75.0

Other Sources/(Uses) 6.0 - - - - - - - - - - - 6.0

Property Tax TAN Repayment Reserve (41.3) - - - - - (7.7) (4.5) (11.9) (9.0) (15.1) (26.8) (116.3)

Issue/Repayment of TANs and other cash activity (35.3) - - - - 25.0 17.3 20.5 (11.9) (9.0) (15.1) (26.8) (35.3)

Revenues less expenditures and other cash activity (39.8) (24.7) (24.7) 0.1 (1.9) 13.5 8.3 (8.7) (19.4) (26.8) (11.8) 28.0 (107.9)

Potential risks to General Fund:

Increased pension contribution per actuaries - (0.5) (0.5) (0.5) (0.4) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (5.2)

Incremental pension contribution to avoid defunding - [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD]Anticipated operating variances - (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (0.2) (2.0)

Contingency (1% of expenditures) - (0.6) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (0.5) (0.6) (5.7)


Potential Adjustments to General Fund - (1.3) (1.1) (1.2) (1.1) (26.2) (18.5) (21.7) 10.7 7.9 14.0 25.6 (12.9)

General fund cash flow before DTRF (39.8) (26.0) (25.8) (1.1) (3.0) (12.7) (10.1) (30.4) (8.6) (19.0) 2.2 53.6 (120.8)

DTRF transfer - - - - - 78.2 - - - - - 74.5 152.7

Potential General Fund cash flow activity (39.8) (26.0) (25.8) (1.1) (3.0) 65.5 (10.1) (30.4) (8.6) (19.0) 2.2 128.1 31.9

Cash (Use) / Source - Non-General Fund (0.7) (14.5) (10.2) (0.0) (4.4) (3.4) (1.3) (6.8) (8.5) (2.2) (6.6) 24.3 (34.4)

Delinquent Tax - net (use)/source 30.6 - - - - (78.2) - - - - - (30.6) (78.2)

Other (Uses)/Sources (18.5) - - - - - - - - - - - (18.5)

Mental Health withdrawal from pool % - 10.0 - - - - - - - - - - 10.0

Non-General Fund and other cash activity1

11.4 (4.5) (10.2) (0.0) (4.4) (81.6) (1.3) (6.8) (8.5) (2.2) (6.6) (6.3) (121.1)Potential net cash flow activity ($28.4) ($30.6) ($36.0) ($1.1) ($7.4) ($16.1) ($11.4) ($37.2) ($17.2) ($21.1) ($4.4) $121.8 ($89.2)

Beginning pooled cash with risks 246.0 217.6 187.0 151.1 149.9 142.6 126.5 115.0 77.8 60.7 39.5 35.1 246.0

Ending pooled cash before risks1 217.6 188.3 153.5 153.6 147.3 157.3 164.4 148.8 120.9 91.9 73.5 169.7 169.7

Risk adjusted ending pooled cash 1 217.6 187.0 151.1 149.9 142.6 126.5 115.0 77.8 60.7 39.5 35.1 156.8 156.8

Note: (1) Excludes Trust and Agency activity and balance.

Forecast


26/31


FY16 cash risk detail


$ in millions Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 FY16

Property Tax $24.0 $14.9 $1.5 $29.9 $22.9 $20.7 $10.2 $5.8 $15.7 $11.9 $20.2 $90.9 $268.5

Other revenues 16.8 15.7 18.8 15.9 18.9 12.6 25.4 10.1 21.4 17.3 28.8 18.3 219.9General Fund Revenue 40.9 30.7 20.3 45.7 41.7 33.3 35.6 15.9 37.0 29.1 49.0 109.2 488.4

Operating expenditures (35.5) (38.3) (36.7) (37.2) (36.5) (36.9) (36.8) (36.8) (31.2) (38.6) (36.7) (63.5) (464.7)

Legacy expenditures (7.3) (15.2) (6.6) (6.6) (5.9) (6.6) (6.4) (6.6) (11.5) (7.0) (7.0) (6.8) (93.4)

General Fund expenditures (42.8) (53.5) (43.3) (43.8) (42.5) (43.4) (43.3) (43.4) (42.8) (45.6) (43.7) (70.3) (558.1)

Receipt of TANs - - - - - 25.0 25.0 25.0 - - - - 75.0

Other Sources/(Uses) - - - - - - - - - - - - -

Property Tax TAN Repayment Reserve - - - - - - (7.4) (4.4) (11.5) (8.8) (14.6) (28.3) (75.0)

Issue/Repayment of TANs and other cash activity - - - - - 25.0 17.6 20.6 (11.5) (8.8) (14.6) (28.3) -

Revenues less expenditures and other cash activity (1.9) (22.8) (23.0) 2.0 (0.7) 14.8 10.0 (6.9) (17.3) (25.2) (9.3) 10.7 (69.7)

Potential risks to General Fund:

Increased pension contribution per actuaries (0.4) (0.5) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (5.3)

Incremental pension contribution to avoid defunding [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD] [TBD]Anticipated operating variances (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.3) (0.4) (3.9)

Contingency (1% of expenditures) (0.4) (0.5) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.4) (0.5) (0.4) (0.7) (5.6)


Potential Adjustments to General Fund (1.2) (1.3) (1.2) (1.2) (1.1) (26.2) (18.8) (21.8) 10.4 7.6 13.4 26.8 (14.8)

General fund cash flow before DTRF (3.1) (24.1) (24.2) 0.7 (1.9) (11.4) (8.8) (28.7) (6.9) (17.7) 4.1 37.5 (84.5)

DTRF transfer - - - - - - - - - - - 39.5 39.5

Potential General Fund cash flow activity (3.1) (24.1) (24.2) 0.7 (1.9) (11.4) (8.8) (28.7) (6.9) (17.7) 4.1 76.9 (45.1)

Cash (Use) / Source - Non-General Fund (3.9) (10.7) (8.2) 2.9 (2.7) (1.6) 0.7 (4.7) (6.5) (0.1) (4.5) 4.9 (34.2)

Delinquent Tax - net (use)/source - - - - - - - - - - - - -

Other (Uses)/Sources - - - - - - - - - - - - -


Non-General Fund and other cash activity1

(3.9) (26.7) (8.2) 2.9 (2.7) (1.6) 0.7 (4.7) (6.5) (0.1) (4.5) 4.9 (50.2)Potential net cash flow activity ($7.0) ($50.9) ($32.4) $3.7 ($4.6) ($12.9) ($8.1) ($33.4) ($13.4) ($17.7) ($0.4) $81.9 ($95.3)

Beginning pooled cash with risks 156.8 149.8 99.0 66.5 70.2 65.7 52.7 44.6 11.2 (2.2) (20.0) (20.3) 156.8

Ending pooled cash before risks1 163.9 114.3 83.1 88.0 84.6 97.9 108.6 97.0 73.2 47.9 34.1 89.2 89.2

Risk adjusted ending pooled cash 1 149.8 99.0 66.5 70.2 65.7 52.7 44.6 11.2 (2.2) (20.0) (20.3) 61.6 61.6

Note: (1) Excludes Trust and Agency activity and balance.

Forecast


27/31


Non-GF cash activity detail

The above cash flow activity is for non-General funds amajority of which are intended to be self supporting.Accordingly, actual fund activity may have non-cashtransfers such as a use of fund balance to cover deficit

amounts presented in the table to the left.

Non-general Fund cash activity ($ in millions) YoY change

Fund Fund Name FY14 FY15 FY16 FY15 FY16

00201 County Road Fund 6.4 (21.4) (21.4) (27.7) -

00469 Construction - Bldg Authority (17.3) - - 17.3 -

00835 Circuit Court 12.6 (0.4) (0.4) (13.0) 0.0

00590 Downriver Sewage Disp.Sys (10.7) (0.2) (0.2) 10.5 0.0

00266 Law Enforcement 0.4 (3.1) (3.1) (3.5) -

00836 Friend of the Court (2.8) (0.0) (0.0) 2.8 0.0

00221 County Health Fund (3.7) (1.1) (1.1) 2.6 (0.0)

00401 Capital Programs (5.2) (2.8) (2.8) 2.5 -

00265 Drug Enforcement Program Fund 1.9 (0.3) (0.3) (2.2) -

00676 Health Fund (1.9) (0.0) - 1.9 0.0

00677 Worker Compensation Self Insur 1.9 (0.0) - (1.9) 0.0

00821 Chapter 20 Drains - O & M 1.3 - - (1.3) -

00598 Rouge Val Sewage Disp Sys (1.3) (0.0) - 1.3 0.0

00599 N.E. Sewage Disposal Sys (1.2) - - 1.2 -

00516 Parking Lots Fund 1.2 0.0 - (1.2) (0.0)00297 Youth Services (1.2) (0.1) (0.1) 1.2 -

00801 Regular Drain Fund-Maint. (1.0) - - 1.0 -

Other (1.9) (5.0) (4.9) ($3.1) $0.2

Total source/(use) (22.8) (34.4) (34.2) ($11.5) $0.2

Source: D epartment of Management & Budget


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Historical operating variances

The schedules to the left are excerpts from theCountys CAFR for 2012 and 2013, which list totalexpenditures in excess of 2.5% of the final amendedbudget the General Fund. General fund operating variances from Public

Safety (Jail and Sheriff) decreased from $30m inFY12 to $27m in FY13.

Prosecuting Attorney operating variancesincreased from $2.7m in FY12 to $11.5m in FY13.

FY12 operating variances - General Fund

$ in 000's

Final Amended

Budget

Actual

Expenditures

Amount Over

Budget

Prosecuting Attorney 38,038 40,759 2,721

Office of the County Executive 1,975 2,393 418

Register of Deeds remonumentat 410 588 178

Public safety:

County jai l 85,227 110,544 25,317

Sheriff 29,560 31,567 2,007

Health and welfare:

Indigent Health Care 26,304 36,310 10,006

Medical examiner 5,471 6,377 906

Senior Citizen Services 128 284 156

Cooperative extensi on 303 369 66

Non Departmental:

General Fund Transfersincluding Special Item 99,908 134,101 34,193

Economic Development 693 892 199

Total General Fund $288,017 $364,184 $76,167

Source: FY12 CAFR page 66

FY13 operating variances - General Fund

$ in 000's

Final Amended

Budget

Actual

Expenditures

Amount Over

Budget

Adult Probation 2,039 2,105 66

County Elections 1,917 2,032 115

Office of the County Executive 5,435 5,733 298

Health and welfare 335 360 25

Prosecuting Attorney 31,029 42,518 11,489

Public safety:

County jail 89,131 118,723 29,592

Sheriff 30,950 32,205 1,255

Total General Fund $160,836 $203,676 $42,840

Source: FY13 CAFR page 60


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Sources and Assumptions

FY14A-FY16F FY17F-FY19F

Revenues (primary source: 2014 15 Cashflow model 11-18-14 vs. 3.xlsx)

PropertyTaxes

Per File: 2014 12 22 - Property Tax Revenue Projection revised 12-22-14 toinclude 2020 by PZ.xlsx, Adjusted from primary source to take into accountrevised taxable values after impact of PPT legislation and lower reappraisalvalues, assuming Oct14 and Nov14 of primarysource were actual, withconsistent seasonality of model for remaining months of FY15-FY16 perupdated tax projections

Per new source file

Non-Taxrevenues

Growth assumptions per Department of Management and Budget model Long-term growth assumption of2.0%

DTRFTransfers-in

DTRF transfers in Mar15 of $78.2m to be approved by commission, and$74.5m and $39.5m in transfers effective Sep15 and Sep16, respectively tobe approved by commission.

FY17 FY19 per Treasurers officefile Estimated General FundTransfers 2015.01.14.xlsx

OtherFinancingSources

Consists primarily of Cobo Hall liquor tax, which is expected to stay atcurrent level if not grow larger

Assumed flat growth with FY16 at$6.6m

Expenditures(primary source: 2014 15 Cashflow model 11-18-14 vs. 3.xlsx)

Personnel Takes into account $15m related to excess Sheriff overtime and otherpremium/differential pay

2.0% growth in Salaries andWages and Overtime

FringeBenefits

Split of Active and Legacy Hospitalization insurance: Active: 56% Retiree: 44%

5.0% growth for Hospitalization 2.0% growth for Other Fringe

Benefits

The preliminary financial projections (the Financial Projections) contained herein, its assumptions and underlying data arethe product of theClient and its management (Management) and consist of information obtained solely from the Client.

FY14A is unaudited and is subject to change.

The following are significant assumptions included in the FY15 and FY16 monthly forecast and FY17-FY19 Financial Projections:


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Sources and Assumptions (cont.)

The following are significant assumptions included in the FY15 and FY16 monthly forecast and FY17-FY19 illustrative trends:

FY14A-FY16F FY17F-FY19F

Expenditures (continued)(primary source: 2014 15 Cashflow model 11-18-14 vs. 3.xlsx)

Operating TransfersOut Operating Transfers Out in the amount of the respective funds payments forHospitalization Insurance, and Debt Service transfers adjusted back intoOperating Transfers Out and reflected in Legacy expenditures for thefollowing funds: County Park; County Health; Comm Dev Blk Grant (CDBG); Juv Justice

and Abuse/Neglect; Circuit Count; Friend of Circuit Court; Probate Court;HCS Nutrition; Community & Economic Development

2.0% growth

Other OperatingExpenditures

Rental related to Jail debt service adjusted out of Rental and included inLegacy Expenditures Debt Service

2.0% growth

Legacy Expenditures(primary source: 2014 15 Cashflow model 11-18-14 vs. 3.xlsx)

Pension Includes Retirement and Retirement Ct Reorg; DB pension contributionof 48.6% based on same% of relevant Salariesand Wages from FY16

Hospitalization Retiree

Includes assumed retiree portion of Hospitalization costs and insurance asnoted in Fringe Benefits assumptions

5% growth

Debt Service Includes: Jail debt service included in rentals; Transfers to the General DebtService Account; Principal, and Interest Payments from the GF

Flat with FY16

Other Cashflow activity(primary source: 2014 15 Cashflow model 11-18-14 vs. 3.xlsx)

General Fund FY14 includes actuals in October; additional analysis to be conducted byCounty for remainder of FY15 FY16

Flat with FY16

Non- General Fund Includes Non-GF, Mental Health withdrawal from pool and other additionalanalysis to be conducted by Department of Management and Budget forFY15-FY17

Flat with FY16

DTRF Activity Per Treasurers office file Estimated General Fund Transfers 2015.01.14.xlsx


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