In the “TAXABILITY OF INTEREST” Iowa Valley CC... · New Issue Investment Rating: . Moody’s...

New Issue Investment Rating: Moody’s Investors Service … Aa3

FINAL OFFICIAL STATEMENT DATED OCTOBER 9, 2019

In the opinion of Ahlers & Cooney, P.C., Bond Counsel, under present law interest on the Certificates is includable in gross income of the owners thereof for purposes of present federal income taxation as more fully discussed under the heading “TAXABILITY OF INTEREST” herein.

$4,790,000 IOWA VALLEY COMMUNITY COLLEGE DISTRICT, IOWA

(Merged Area VI)

Taxable Industrial New Jobs Training Certificates, Series 2019-2 Dated Date of Delivery Book-Entry Due as Detailed Below

The $4,790,000 Taxable Industrial New Jobs Training Certificates, Series 2019-2 (the “Certificates”) are being issued by Iowa Valley Community College District, Iowa (Merged Area VI) (the “District”). Interest is payable semiannually on June 1 and December 1 of each year, commencing June 1, 2020. Interest is calculated based on a 360-day year of twelve 30-day months. The Certificates will be issued using a book-entry system. The Depository Trust Company (“DTC”), New York, New York, will act as securities depository for the Certificates. The ownership of one fully registered Certificate for each maturity will be registered in the name of Cede & Co., as nominee for DTC and no physical delivery of Certificates will be made to purchasers. The Certificates will mature on June 1 in the following years and amounts.

AMOUNTS, MATURITIES, INTEREST RATES, YIELDS AND CUSIP NUMBERS Principal Due Interest CUSIP Principal Due Interest CUSIP Amount June 1 Rate Yield Number(1) Amount June 1 Rate Yield Number(1) $625,000 .............. 2020 1.800% 1.800% 462602 NU3 $985,000 .............. 2023 1.800% 1.800% 462602 NX7 985,000 .............. 2021 1.800% 1.700% 462602 NV1 985,000 .............. 2024 1.850% 1.850% 462602 NY5 985,000 .............. 2022 1.800% 1.750% 462602 NW9

$225,000 .................. 2.350% Term Certificates due June 1, 2029 Yield ..................... 2.350% 462602 PD9

For further details see “MANDATORY REDEMPTION” herein.

OPTIONAL REDEMPTION

Certificates due June 1, 2020 - 2025, inclusive, are not subject to optional redemption. Certificates due June 1, 2026 - 2029, inclusive, are callable in whole or in part on any date on or after June 1, 2025, at a price of par and accrued interest. If less than all the Certificates are called, they shall be redeemed in such principal amounts and from such maturities as determined by the District and within any maturity by lot. See “OPTIONAL REDEMPTION” herein.

PURPOSE, LEGALITY AND SECURITY

The Certificate proceeds will be used to: (i) fund new jobs training projects (the “Projects”) pursuant to certain Industrial New Jobs Training Agreements, (ii) fund a Debt Service Reserve Fund in the amount of approximately $562,848 and (iii) pay certain Certificate issuance costs and administrative expenses. See “DESCRIPTION OF THE CERTIFICATES - Projects” and “DESCRIPTION OF THE CERTIFICATES – Use of Proceeds” herein.

In the opinion of Bond Counsel, Ahlers & Cooney, P.C., Des Moines, Iowa, the Certificates will constitute valid and legally binding obligations of the District and the Certificates are payable from the Net Revenues as more fully described herein under “DESCRIPTION OF THE CERTIFICATES - Security”. In the event such Net Revenues are insufficient, the Certificates are payable from a special standby tax levied upon all taxable property within the Merged Area without limitation as to rate or amount, all except as limited by bankruptcy, insolvency, moratorium, reorganization and other similar laws relating to the enforcement of creditors’ rights generally and except that enforcement by equitable and similar remedies, such as mandamus, is subject to the exercise of judicial discretion. Additional security for the Certificates is provided by a Debt Service Reserve Fund (the “Reserve Fund”) to be applied, until depleted, to pay interest and principal payments due on the Certificates.

The Certificates are offered when, as and if issued and received by the Underwriter, subject to the approving legal opinion of Ahlers & Cooney, P.C., Des Moines, Iowa, Bond Counsel, and certain other conditions. It is expected that the Certificates will be made available for delivery on or about November 5, 2019. (1) CUSIP numbers appearing in this Final Official Statement have been provided by the CUSIP Service Bureau, which is managed on behalf of the American Bankers Association by S&P Capital IQ, a part of McGraw Hill

Financial Inc. The District is not responsible for the selection of CUSIP numbers and makes no representation as to their correctness on the Certificates or as set forth on the cover of this Final Official Statement.

No dealer, broker, salesman or other person has been authorized by the District to give any information or to make any representations with respect to the Certificates other than as contained in the Official Statement or the Final Official Statement and, if given or made, such other information or representations must not be relied upon as having been authorized by the District. Certain information contained in the Official Statement and the Final Official Statement may have been obtained from sources other than records of the District and, while believed to be reliable, is not guaranteed as to completeness. THE INFORMATION AND EXPRESSIONS OF OPINION IN THE OFFICIAL STATEMENT AND THE FINAL OFFICIAL STATEMENT ARE SUBJECT TO CHANGE, AND NEITHER THE DELIVERY OF THE OFFICIAL STATEMENT OR THE FINAL OFFICIAL STATEMENT NOR ANY SALE MADE UNDER EITHER SUCH DOCUMENT SHALL CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE DISTRICT SINCE THE RESPECTIVE DATES THEREOF.

References herein to laws, rules, regulations, ordinances, resolutions, agreements, reports and other documents do

not purport to be comprehensive or definitive. All references to such documents are qualified in their entirety by reference to the particular document, the full text of which may contain qualifications of and exceptions to statements made herein. Where full texts have not been included as appendices to the Official Statement or the Final Official Statement, they will be furnished on request. This Official Statement does not constitute an offer to sell, or solicitation of an offer to buy, any securities to any person in any jurisdiction where such offer or solicitation of such offer would be unlawful.

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TABLE OF CONTENTS

Page CERTIFICATE ISSUE SUMMARY ..................................................................................................................................... 1 CERTIFICATE HOLDERS’ RISKS ...................................................................................................................................... 2

Secondary Market ............................................................................................................................................................... 2 Ratings Loss ........................................................................................................................................................................ 2 Forward-Looking Statements .............................................................................................................................................. 3 DTC-Beneficial Owners ..................................................................................................................................................... 3 Continuing Disclosure ........................................................................................................................................................ 3 Cybersecurity ...................................................................................................................................................................... 4 Suitability of Investment ..................................................................................................................................................... 4 Bankruptcy and Insolvency ................................................................................................................................................. 4 Federal Tax Legislation ...................................................................................................................................................... 4 Tax Levy Procedures .......................................................................................................................................................... 5 Other Factors ....................................................................................................................................................................... 5

DESCRIPTION OF THE CERTIFICATES ........................................................................................................................... 5 Introduction ......................................................................................................................................................................... 5 Description of Certificates .................................................................................................................................................. 5 Authority ............................................................................................................................................................................. 6 Projects ................................................................................................................................................................................ 6 Security ............................................................................................................................................................................... 6 Optional Redemption .......................................................................................................................................................... 6 Sources and Use of Proceeds .............................................................................................................................................. 7 Summary of the Resolution and Parity Certificates ............................................................................................................ 7

THE COMPANIES ................................................................................................................................................................. 8 THE DISTRICT ...................................................................................................................................................................... 8

District Organization and Services ..................................................................................................................................... 9 Enrollment History .............................................................................................................................................................. 9 Educational Facilities ........................................................................................................................................................ 10

SOCIOECONOMIC INFORMATION ................................................................................................................................ 10 Population ......................................................................................................................................................................... 10 Employment ...................................................................................................................................................................... 11 Income Statistics ............................................................................................................................................................... 11 Agriculture ........................................................................................................................................................................ 12 Retail Sales ........................................................................................................................................................................ 12

DEFAULT RECORD ........................................................................................................................................................... 13 SHORT-TERM BORROWING ........................................................................................................................................... 13 DEBT INFORMATION ....................................................................................................................................................... 13 PROPERTY ASSESSMENT AND TAX INFORMATION ................................................................................................ 14

Property Tax Assessment .................................................................................................................................................. 14 Property Tax Collection .................................................................................................................................................... 15 Levy Limits ....................................................................................................................................................................... 17 Tax Levy Procedures ........................................................................................................................................................ 18 Utility Property Tax Replacement .................................................................................................................................... 18 Tax Increment Financing .................................................................................................................................................. 18 Legislation ......................................................................................................................................................................... 19

FINANCIAL INFORMATION ............................................................................................................................................ 20 Financial Reports .............................................................................................................................................................. 20 No Consent or Updated Information Requested of the Auditor........................................................................................ 20 Summary Financial Information ....................................................................................................................................... 20

EMPLOYEE RETIREMENT AND OTHER POST EMPLOYMENT BENEFIT OBLIGATIONS................................... 24 Pensions ............................................................................................................................................................................ 24 Other Post-Employment Benefits (OPEB)........................................................................................................................ 25

REGISTRATION, TRANSFER AND EXCHANGE........................................................................................................... 27

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TAXABILITY OF INTEREST ............................................................................................................................................ 27

General .............................................................................................................................................................................. 27 Interest Income Taxable .................................................................................................................................................... 28 Sale, Exchange, or Other Disposition ............................................................................................................................... 28 Backup Withholding and Information Reporting ............................................................................................................. 28 Enforcement ...................................................................................................................................................................... 28 Opinion ............................................................................................................................................................................. 29

CONTINUING DISCLOSURE ............................................................................................................................................ 29 OPTIONAL REDEMPTION ................................................................................................................................................ 29 MANDATORY REDEMPTION .......................................................................................................................................... 30 LITIGATION ........................................................................................................................................................................ 30 LEGAL MATTERS .............................................................................................................................................................. 30 FINAL OFFICIAL STATEMENT AUTHORIZATION ..................................................................................................... 31 INVESTMENT RATING ..................................................................................................................................................... 31 UNDERWRITING ............................................................................................................................................................... 31 MUNICIPAL ADVISOR ...................................................................................................................................................... 32 CERTIFICATION ................................................................................................................................................................ 32 APPENDIX A - FISCAL YEAR 2018 AUDITED FINANCIAL STATEMENTS APPENDIX B - DESCRIBING BOOK-ENTRY-ONLY ISSUANCE APPENDIX C - DRAFT FORM OF LEGAL OPINION APPENDIX D - DRAFT FORM OF CONTINUING DISCLOSURE CERTIFICATE APPENDIX E - MAP OF IOWA COMMUNITY COLLEGES

Iowa Valley Community College District (Merged Area VI), Iowa $4,790,000 Taxable Industrial New Jobs Training Certificates, Series 2019-2

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CERTIFICATE ISSUE SUMMARY

This Certificate Issue Summary is expressly qualified by the entire Final Official Statement which is provided for the convenience of potential investors and should be reviewed in its entirety by potential investors. Issuer: Iowa Valley Community College District, (Merged Area VI), Iowa. Issue: $4,790,000 Taxable Industrial New Jobs Training Certificates, Series 2019-2. Dated Date: Date of delivery (expected to be on or about November 5, 2019). Interest Due: Each June 1 and December 1, commencing June 1, 2020. Principal Due: June 1, as detailed on the cover page of this Final Official Statement. Optional Redemption: Certificates maturing on or after June 1, 2026, are callable at the option of the District on

any date on or after June 1, 2025, at a price of par plus accrued interest. See “OPTIONAL REDEMPTION” herein.

Mandatory Redemption: The Certificates are subject to mandatory redemption. See “MANDATORY REDEMPTION” herein.

Authorization: The Certificates are being issued pursuant to authority established in Code of Iowa, 2019

as amended, Chapter 260E (the “Act”), and all laws amendatory thereof and supplementary thereto, and in conformity with a resolution (the “Resolution” or the “Certificate Resolution”) of the District duly passed and approved.

Security: The Certificates will constitute valid and legally binding obligations of the District payable

from the Net Revenues as more fully described herein under “DESCRIPTION OF THE CERTIFICATES - Security”. In the event such Net Revenues are insufficient, the Certificates are payable from a special standby tax levied upon all taxable property within the Merged Area without limitation as to rate or amount, all except as limited by bankruptcy, insolvency, moratorium, reorganization and other similar laws relating to the enforcement of creditors’ rights generally and except that enforcement by equitable and similar remedies, such as mandamus, is subject to the exercise of judicial discretion. Additional security is provided by a Debt Service Reserve Fund (the “Reserve Fund”) to be applied, until depleted, to pay interest and principal payments due on the Certificates.

Investment Rating: The Certificates have been rated “Aa3” by Moody’s Investors Service, New York, New

York. See “INVESTMENT RATING” herein. Purpose: The proceeds of the Certificates will be used to: (i) fund new jobs training projects (the

“Projects”) pursuant to certain Industrial New Jobs Training Agreements, (ii) fund a Debt Service Reserve Fund in the amount of approximately $562,848, and (iii) pay certain Certificate issuance costs and administrative expenses. See “DESCRIPTION OF THE CERTIFICATES - Projects” and “DESCRIPTION OF THE CERTIFICATES – Use of Proceeds” herein.

Taxability: The interest to be paid on the Certificates is subject to federal and Iowa state income taxes

as discussed under “TAXABILITY OF INTEREST” in this Final Official Statement. See APPENDIX C for a draft form of legal opinion for the Certificates.

Registrar/Paying Agent: UMB Bank, n.a., West Des Moines, Iowa. Delivery: The Certificates are expected to be delivered on or about November 5, 2019. Book-Entry Form: The Certificates will be registered in the name of Cede & Co. as nominee for The

Depository Trust Company (“DTC”), New York, New York. DTC will act as securities depository of the Certificates. See APPENDIX B herein.

Denomination: $5,000 or integral multiples thereof. Municipal Advisor: Speer Financial, Inc., Waterloo, Iowa and Chicago, Illinois.


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IOWA VALLEY COMMUNITY COLLEGE DISTRICT, IOWA

(Merged Area VI)

Board of Directors Larry W. Johnson, President Paul William Pohlson, Vice President Chris Brodin Deb Crosser Joanna Hofer Deborah Jones Delbert Kellogg

__________________________________ Officials Kristie Fisher, Ph.D. ............................................................................... Chancellor Kathleen Pink ........... Vice Chancellor of District Finance/Chief Financial Officer Jacque Goodman. ............. Vice Chancellor of Continuing Education and Training Barbara Jennings ......................... Assistant to the Chancellor and Board Secretary

______________________________________

CERTIFICATE HOLDERS’ RISKS Secondary Market There can be no guarantee that there will be a secondary market for the Certificates or, if a secondary market exists, that such Certificates can be sold for any particular price. Occasionally, because of general market conditions or because of adverse history of economic prospects connected with a particular issue, secondary marketing practices in connection with a particular bond or note issue are suspended or terminated. Additionally, prices of bond or note issues for which a market is being made will depend upon then prevailing circumstances. Such prices could be substantially different from the original purchase price of the Certificates. EACH PROSPECTIVE PURCHASER IS RESPONSIBLE FOR ASSESSING THE MERITS AND RISKS OF AN INVESTMENT IN THE CERTIFICATES AND MUST BE ABLE TO BEAR THE ECONOMIC RISK OF SUCH INVESTMENT. THE SECONDARY MARKET FOR THE CERTIFICATES, IF ANY, COULD BE LIMITED. Ratings Loss

Moody’s Investors Service, Inc. (“Moody’s”) has assigned a rating of “Aa3” to the Certificates. Generally, a rating agency bases its rating on the information and materials furnished to it and on investigations, studies and assumptions of its own. There is no assurance that the rating will continue for any given period of time, or that such rating will not be revised, suspended or withdrawn, if, in the judgment of Moody’s, circumstances so warrant. A revision, suspension or withdrawal of a rating may have an adverse effect on the market price of the Certificates.


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Various factors, including additional regulation of rating agencies could materially alter the methodology, rating

levels, and types of ratings available, for example, and these changes, if ever, could materially affect the market value of the Certificates. Forward-Looking Statements

This Final Official Statement contains statements relating to future results that are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. When used in this Final Official Statement, the words “estimate,” “forecast,” “intend,” “expect” and similar expressions identify forward-looking statements. Any forward-looking statement is subject to uncertainty. Accordingly, such statements are subject to risks that could cause actual results to differ, possibly materially, from those contemplated in such forward-looking statements. Inevitably, some assumptions used to develop forward-looking statements will not be realized or unanticipated events and circumstances may occur. Therefore, investors should be aware that there are likely to be differences between forward-looking statements and the actual results. These differences could be material and could impact the availability of funds of the District to pay debt service when due on the Certificates. DTC-Beneficial Owners

Beneficial Owners of the Certificates may experience some delay in the receipt of distributions of principal of and interest on the Certificates since such distributions will be forwarded by the Paying Agent to DTC and DTC will credit such distributions to the accounts of the Participants which will thereafter credit them to the accounts of the Beneficial Owner either directly or indirectly through indirect Participants. Neither the District nor the Paying Agent will have any responsibility or obligation to assure that any such notice or payment is forwarded by DTC to any Participants or by any Participant to any Beneficial Owner.

In addition, since transactions in the Certificates can be effected only through DTC Participants, indirect participants and certain banks, the ability of a Beneficial Owner to pledge the Certificates to persons or entities that do not participate in the DTC system, or otherwise to take actions in respect of such Certificates, may be limited due to lack of a physical certificate. Beneficial Owners will be permitted to exercise the rights of registered Owners only indirectly through DTC and the Participants. See APPENDIX B – Describing Book-Entry Only Issuance. Continuing Disclosure

A failure by the District to comply with continuing disclosure obligations (see “CONTINUING DISCLOSURE” herein) will not constitute an event of default on the Certificates. Any such failure must be disclosed in accordance with Rule 15c2-12 (the “Rule”) adopted by the Securities and Exchange Commission (the “Commission”) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and may adversely affect the transferability and liquidity of the Certificates and their market price. The District will covenant in a Continuing Disclosure Certificate for the benefit of the Owners and Beneficial Owners of the Certificates to provide annually certain financial information and operating data relating to the District (the “Annual Report”), and to provide notices of the occurrence of certain enumerated events. The Annual Report is to be filed by the District no later than two hundred seventy (270) days after the close of each fiscal year, commencing with the fiscal year ending June 30, 2019, with the Municipal Securities Rulemaking Board, at its internet repository named “Electronic Municipal Market Access” (“EMMA”). The notices of events, if any, are also to be filed with EMMA. See “APPENDIX D – FORM OF CONTINUING DISCLOSURE CERTIFICATE.” The specific nature of the information to be contained in the Annual Report or the notices of events, and the manner in which such materials are to be filed, are summarized in “APPENDIX D – FORM OF CONTINUING DISCLOSURE CERTIFICATE.” These covenants have been made in order to assist the Underwriter in complying with SEC Rule 15c2-12(b)(5) (the “Rule”).


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Cybersecurity The District, like many other public and private entities, relies on a large and complex technology environment to conduct its operations. As such, it may face multiple cybersecurity threats including but not limited to, hacking, viruses, malware and other attacks on computer or other sensitive digital systems and networks. There can be no assurances that any security and operational control measures implemented by the District will be completely successful to guard against and prevent cyber threats and attacks. Failure to properly maintain functionality, control, security, and integrity of the District’s information systems could impact business operations and/or digital networks and systems and the costs of remedying any such damage could be significant. Along with significant liability claims or regulatory penalties, any security breach could have a material adverse impact on the District’s operations and financial condition. The District has a $1,000,000 Cyber-Liability Policy. The District cannot predict whether this policy will be sufficient in the event of a cyberattack. However, the Certificates are secured by an unlimited ad valorem property tax as described herein. Suitability of Investment The interest rate borne by the Certificates is intended to compensate the investor for assuming the risk of investing in the Certificates. Each prospective investor should carefully examine this Final Official Statement and its own financial condition to make a judgment as to its ability to bear the economic risk of such an investment, and whether or not the Certificates are an appropriate investment for such investor. Bankruptcy and Insolvency The rights and remedies of the owners of the Certificates may be limited by and are subject to the provisions of federal bankruptcy laws, to other laws or equitable principles that may affect the enforcement of creditors’ rights, to the exercise of judicial discretion in appropriate cases and to limitations on legal remedies against local governments. The various opinions of counsel to be delivered with respect to the Certificates will be similarly qualified. Federal Tax Legislation

From time to time, there are Presidential proposals, proposals of various federal committees, and legislative proposals pending in Congress that could, if enacted, alter or amend one or more of the federal tax matters described herein in certain respects or would adversely affect the market value of the Certificates. Further such proposals may impact the marketability or market value of the Certificates simply by being proposed. It cannot be predicted whether or in what forms any of such proposals, either pending or that may be introduced, may be enacted and there can be no assurance that such proposals will not apply to the Certificates. In addition regulatory actions are from time to time announced or proposed, and litigation threatened or commenced, which if implemented or concluded in a particular manner, could adversely affect the market value, marketability or tax status of the Certificates. 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 Certificates would be impacted thereby.


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Tax Levy Procedures

The Certificates are general obligations of the District, payable from and secured by a continuing ad valorem tax levied against all of the taxable property valuation within Merged Area VI. See “PROPERTY ASSESSMENT AND TAX INFORMATION” herein for more details. As part of the budgetary process each fiscal year, Merged Area VI will have an obligation to request a debt service levy to be applied against all of the taxable property within the District. A failure on the part of the District to make a timely levy request or a levy request by the District that is inaccurate or is insufficient to make full payments of the debt service of the Certificates for a particular fiscal year may cause Certificate holders to experience delay in the receipt of distributions of principal of and/or interest on the Certificates. In the event of a default in the payment of principal of or interest on the Certificates, there is no provision for acceleration of maturity of the principal of the Certificates. Consequently, the remedies of the owners of the Certificates (consisting primarily of an action in the nature of mandamus requiring the District and certain other public officials to perform the terms of the resolution for the Certificates) may have to be enforced from year to year. Other Factors

An investment in the Certificates involves an element of risk. The foregoing is intended only as a summary of certain risk factors attendant to an investment in the Certificates. In order for potential investors to identify risk factors and make an informed investment decision, potential investors should become thoroughly familiar with this entire Final Official Statement and the Appendices hereto.

DESCRIPTION OF THE CERTIFICATES Introduction This Final Official Statement, including the cover page and all appendices, is provided to set forth certain information with respect to the District, the Certificates, and the companies involved. None of the references to or summaries of the laws of the State of Iowa or any documents referred to in this Final Official Statement purport to be complete, and all such references are qualified in their entirety by reference to the complete provisions thereof. Description of Certificates The Certificates are dated the date of delivery (expected to be on or about November 5, 2019) and will be issued as fully registered certificates in the denomination of $5,000 or any integral multiple thereof and, when issued, will be registered in the name of Cede & Co., as Certificate holder and nominee of the Depository Trust Company, New York, New York (“DTC”). DTC will act as securities depository for the Certificates. Purchases of the Certificates will be made in book-entry form. Purchasers of the Certificates will not receive certificates representing their interest in the Certificates purchased. So long as DTC or its nominee, Cede & Co., is the Certificate holder, the principal and interest on the Certificates will be paid to DTC, which will in turn remit such principal and interest to its participants for subsequent dispersal to the beneficial owners of the Certificates as described herein. Disbursement of such payments to the Beneficial Owners is the responsibility of the DTC Participants as more fully described in APPENDIX B. The Certificates will bear interest from their dated date at such rates and mature on the dates and in the amounts set forth herein, with interest being payable June 1, 2020 and semiannually thereafter on the first day of June and December in each year until maturity or earlier redemption. Interest will be computed on the basis of a 360-day year of twelve 30-day months. Payments of principal and interest shall be made to the registered holders thereof or to their designated agents as the same appear on the books of the Certificate Registrar.


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Authority The Certificates are issued pursuant to the provisions of Chapter 260E of the Code of Iowa, as amended (the “Act”), and in conformity with a resolution of the Board of Directors of the District authorizing the issuance of the Certificates (the “Resolution”). Projects The Certificates are issued for the purpose of paying a portion of the costs of training arrangements and new jobs training programs (the “Projects”) which are the subject of and in conformity with certain Industrial New Jobs Training Agreements (the “Agreements”) between the District and the Companies described under “THE COMPANIES” herein. Security The Certificates constitute a valid and binding obligation of the District, payable from the Net Revenues. The “Net Revenues” are the revenues and funds derived from the Agreements, held in a special fund (the “Revenue Fund”) and pledged to the payment of the Certificates. The sources of Net Revenues include new jobs credit from withholding to be received or derived from new employment resulting from the Projects (1½% of the wages paid on the new jobs created); supplemental new jobs credit from withholding to be received or derived from new employment resulting from the Projects (an additional 1½% of the wages paid on those jobs for which the employer has agreed to pay wages of at least the Laborshed wage); and tuition, student fees or special charges, if any, fixed by the Board of Directors of the District to defray program costs. The Projects are sized in order that the anticipated Net Revenues are sufficient to meet the debt service requirements of the Certificates as the same become due. Additional security is provided by a Reserve Fund to be applied, until depleted, to pay interest and principal payments due on the Certificates. In the event such Net Revenues are not available and appropriated in any year as provided by the Act and in the Agreement, all the taxable property in the Merged Area is subject to ad valorem taxation without limitation as to rate or amount (the “Standby Tax”) to pay the Certificates, all except as limited by bankruptcy, insolvency, moratorium, reorganization and other similar laws relating to the enforcement of creditors’ rights generally and except that enforcement by equitable and similar remedies, such as mandamus, is subject to the exercise of judicial discretion. The Standby Tax has been levied by the Resolution for the payment of debt service on the Certificates and the District is required by law to include in its annual tax levy the principal and interest coming due on the Certificates to the extent the necessary funds are not provided from other sources. Optional Redemption

The Certificates due June 1, 2020 - 2025, inclusive, are not subject to optional redemption prior to maturity. The Certificates due June 1, 2026 - 2029, inclusive, are subject to optional redemption prior to maturity in whole or in part on any date on or after June 1, 2025 at a price of par and accrued interest. If less than all the Certificates are called, they shall be redeemed in any order of maturity as determined by the District and within any maturity by lot. So long as Certificates are held by DTC, the District will notify DTC of the particular amount of such maturity to be redeemed prior to maturity. DTC will determine by lot the amount of each participant’s interest in each maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed.

The Registrar will give notice of redemption, identifying the Certificates (or portions thereof) to be redeemed not less than thirty (30) days prior to the date fixed for redemption to the registered owner of each Certificate (or portion thereof) to be redeemed. Failure to give such written notice to any registered owner of the Certificates (or portions thereof) or any defect therein shall not affect the validity of any proceedings for the redemption of other Certificates (or portions thereof). Written notice will be deemed completed upon transmission to the owner of record of the Certificate. All Certificates (or portions thereof) so called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment at that time.


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Sources and Use of Proceeds The proceeds of the Certificates, other than any accrued interest and except as may be provided below, shall be credited to the Project Fund and used to pay the costs of the Projects and the costs of issuance of the Certificates including, but not limited to, underwriting fees, municipal advisor fees, printing costs, and bond counsel fees and expenses. Proceeds of the Certificates shall also be used to fund the Reserve Fund and to pay all District expenses relating to the administration of the new jobs training projects. The estimated sources and use of proceeds of the Certificates is as follows: SOURCES: The Certificates ................................................................... $4,790,000.00 Reoffering Premium ............................................................ 2,738.30 Total .................................................................................. $4,792,738.30 USES: New Jobs Training Project .................................................. $3,182,955.00 College Administration Expense .......................................... 934,050.00 Underwriter’s Discount ........................................................ 18,250.00 Legal and Issuance Costs ................................................... 46,735.00 State Administration Expense ............................................. 47,900.00 Reserve Fund ..................................................................... 562,848.30 Total .................................................................................. $4,792,738.30 Summary of the Resolution and Parity Certificates The Board of Directors of the District is expected to adopt the Resolution on October 9, 2019. Under the Resolution, the District pledges the Net Revenues to the payment of the Certificates (as described previously under “DESCRIPTION OF THE CERTIFICATES - Security” herein). A copy of the Resolution shall be filed in the office of the County Auditors of each county contained within the Merged Area. For the purpose of further securing and providing funds to pay the principal and interest of the Certificates, there has been levied and appropriated to the Revenue Fund for each future year the following direct annual tax, the Standby Tax, on all of the taxable property in the Merged Area: Fiscal Year (July 1 to June 30) Amount of Collection(1) $ 675,327 .............................................................................. 2019/20 1,061,700 .............................................................................. 2020/21 1,043,970 .............................................................................. 2021/22 1,026,240 .............................................................................. 2022/23 1,008,510 .............................................................................. 2023/24 50,288 .............................................................................. 2024/25 49,230 .............................................................................. 2025/26 48,173 .............................................................................. 2026/27 47,115 .............................................................................. 2027/28 46,058 .............................................................................. 2028/29 Note: (1) For example, a levy made and certified against the

taxable valuations of January 1, 2018, will be collected during the fiscal year commencing July 1, 2019.

Provided, however, that the District may direct the adjustment and corresponding reduction of any levy of taxes made whenever funds on hand from any source other than taxation and which may be appropriated to the payment of the Certificates are available in the Revenue Fund. The District does not currently anticipate levying the Standby Tax to pay debt service on the Certificates. Additional certificates (the “Parity Certificates”) may be issued on a parity and equality of rank with the Certificates with respect to the lien and claim of such Parity Certificates to the Net Revenues, for the following purposes and under the following conditions, but not otherwise:


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(a) For the purpose of refunding any of the Certificates or Parity Certificates which shall have matured or which

shall mature not later than three months after the date of delivery of refunding certificates and for the payment of which there shall be insufficient money in the Sinking Fund and the Reserve Fund; and

(b) For the purpose of the Projects or additional projects, so long as Net Revenues are sufficient to secure the

Certificates and the Parity Certificates. Parity Certificates must be payable as to principal and as to interest on the same month and date as the Certificates.

THE COMPANIES JBS or Swift Pork Company Certificate Amount: $430,000 Number of New Jobs: 93

JBS USA includes the U.S., Mexico, Canada and Australia operations. A diversified platform includes beef, pork, poultry, lamb, further processed and consumer ready protein offerings, hides, leather, variety meats and rendered products. The jobs will be located at the Marshalltown, Iowa location. Lennox Industries Certificate Amount: $4,360,000 Number of New Jobs: 750 Lennox Industries is a provider of climate control solutions for heating, air conditioning and refrigeration markets around the world. The jobs will be located at the Marshalltown, Iowa location.

THE DISTRICT

Iowa Valley Community College District (Merged Area VI) was organized in 1966 as one of 15 community college districts in Iowa. The District operates Ellsworth Community College in Iowa Falls, Iowa (founded in 1890), Marshalltown Community College in Marshalltown, Iowa (founded in 1927), and Iowa Valley Continuing Education, as well as a satellite center (Iowa Valley Grinnell, in Grinnell, Iowa established in 1993).

Ellsworth Community College and Marshalltown Community College offer one-year and two-year career-technical programs as well as Associate in Arts (AA) and Associate in Science (AS) transfer degrees. Iowa Valley Continuing Education offers training for business and industry as well as thousands of adult education programs and services throughout the Central Iowa service area. Iowa Valley Grinnell offers both college credit and adult education programs and services in Poweshiek County. Marshalltown Community College was founded in 1927 as Marshalltown Junior College, a part of the Marshalltown Community School District. Marshalltown Community College now serves as a primary attendance center for more than 100,000 persons who live in the Area VI District. Important to the District is its location in the City of Marshalltown (the “City”), one of Iowa’s principal centers of commerce and industry. The District continues to develop its permanent campus on a 277-acre tract on the far south side of the City. Marshalltown Community College is fully accredited by the Higher Learning Commission, North Central Association of Colleges and Schools and is approved by the State Department of Public Education. In addition, many of the District’s vocational and technical programs are accredited by accrediting bodies of their professional organizations.


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Ellsworth Community College began in 1890 as an academy with business training and normal courses supplementing the usual secondary school curriculum. Within nine years the school had developed into a college institution. Situated in Iowa Falls, which overlooks the beautiful Iowa River, Ellsworth has the advantages of being in a city that has become a leading trade center of the most highly mechanized farm area of the Midwest. Ellsworth’s facilities and curricula are modern and varied, striving to provide a good education in an innovative atmosphere. Ellsworth Community College is fully accredited by the Higher Learning Commission, North Central Association of Colleges and Schools and is also approved by the State Department of Public Education. District Organization and Services

The District is governed by a seven member Board of Directors. The board members are elected from the seven districts in the ten-county service area. The District employs approximately 209 full and 589 part-time employees including student employment. The full-time faculty of the District are represented by the Iowa Valley Community College Education Association under a one-year contract which expires on June 30, 2020. Enrollment History

District Credit Enrollment(1) Eligible Total Full-Time Unduplicated Total Fiscal Contact Contact Equivalent Credit Credit Year Hours Hours Enrollment Enrollments Hours

2009/2010 .............................. 1,398,264 1,820,597 3,553 4,460 73,990 2010/2011 .............................. 1,778,212 1,805,746 3,524 4,363 74,486 2011/2012 .............................. 1,706,011 1,771,284 3,393 4,279 69,329 2012/2013 .............................. 1,679,847 1,759,592 3,351 4,232 69,889 2013/2014 .............................. 1,748,812 1,794,765 3,122 4,320 66,073 2014/2015 .............................. 1,503,865 1,565,213 2,965 3,990 62,117 2015/2016 .............................. 1,406,366 1,543,217 n/a 3,622 57,094 2016/2017 .............................. 1,351,989 1,423,081 n/a 3,598 57,226 2017/2018 .............................. 1,278,255 1,325,382 n/a 3,556 55,830

Note: (1) Source: the Iowa Department of Education and the District.

Public School Districts Enrollment by Grades (1) Year K-5 6-8 9-12 Total 2009/10 ........................ 6,563 3,302 4,775 14,640 2010/11 ........................ 6,224 3,057 4,498 13,779 2011/12 ........................ 6,188 3,159 4,499 13,846 2012/13 ........................ 6,191 3,194 4,349 13,734 2013/14 ........................ 6,291 3,167 4,263 13,721 2014/15 ........................ 6,805 3,296 4,521 14,622 2015/16 ........................ 6,887 3,252 4,525 14,664 2016/17 ........................ 6,921 3,312 4,574 14,807 2017/18 ........................ 6,815 3,420 4,543 14,778 2018/19 ........................ 6,653 3,488 4,481 14,622 Note: (1) Source: the Iowa Department of Education.


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Educational Facilities

Located within the Iowa Valley Community College District are 14 public school districts. The public school districts and their total student enrollments and population are listed below. Certified School Enrollment District School District October 2018(1) Population(2) AGWSR ........................................................... 647 4,513 Alden ............................................................... 274 1,572 BCLUW ............................................................ 520 3,416 Brooklyn-Guernsey-Malcom ............................. 552 3,347 East Marshall ................................................... 558 3,886 Eldora-New Providence.................................... 631 3,990 GMG ................................................................ 276 1,888 Grinnell-Newburg ............................................. 1,613 12,151 Hubbard-Radcliffe ............................................ 438 2,654 Iowa Falls ......................................................... 1,053 6,941 Marshalltown .................................................... 5,365 30,561 Montezuma ...................................................... 487 3,499 South Tama County ......................................... 1,541 9,011 West Marshall .................................................. 870 4,766 Total ............................................................... 14,825 92,195 Notes: (1) Source: the Iowa Department of Education. (2) Source: National Center for Education Statistics as of the 2010

Census.

SOCIOECONOMIC INFORMATION Population

The District has an estimated 2010 population of 92,195. The Counties in the Merged Area VI are listed below.

These figures are for the entire respective counties, even though only a portion of each county may be within the boundaries of the Merged Area VI.

Population(1) 2010 2000 1990 1980 Butler ..................................... 14,867 15,305 15,731 17,668 Franklin .................................. 10,680 10,704 11,364 13,036 Grundy ................................... 12,453 12,369 12,029 14,366 Hamilton................................. 15,673 16,438 16,071 17,862 Hardin .................................... 17,534 18,812 19,094 21,776 Jasper .................................... 36,842 37,213 34,795 36,425 Marshall ................................. 40,648 39,311 38,276 41,652 Poweshiek ............................. 18,914 18,815 19,033 19,306 Story ...................................... 89,542 79,981 74,252 72,326 Tama ..................................... 17,767 18,103 17,419 19,533 Note: (1) Source: U.S. Census.


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Employment

Following are lists of certain major employers located in the Merged Area VI Counties. Major Area Employers(1)

Approximate County Name Product/Service Employment(2) Marshall ................. JBS USA, LLC. a/k/a Swift Company ......................... Pork Processing and Packing ....................................................... 2,300 Marshall ................. Emerson Process Management, LLC ......................... Relays and Industrial Controls ...................................................... 1,135 Jasper .................... TPI Composites, LLC ................................................. Turbines ........................................................................................ 1,100 Marshall ................. Marshalltown Community School District ................... Public School District .................................................................... 980 Marshall ................. Iowa Veterans Home ................................................. Nursing Care Facility ..................................................................... 945 Marshall ................. Lennox Industries, Inc. ............................................... Heating and Refrigeration Equipment............................................ 915 Marshall ................. Iowa Valley Community College District ..................... Higher Learning Institute ............................................................... 835 Poweshiek .............. JELD-WEN Door Systems ......................................... Wood Products ............................................................................. 725 Hamilton ................. Van Diest Supply Co. ................................................. Fertilizers ...................................................................................... 700 Marshall ................. Central Iowa Health Care ........................................... Healthcare Facility ........................................................................ 595 Marshall ................. Hy-Vee ...................................................................... Grocery Store ............................................................................... 395 Poweshiek .............. Grinnell-Newburg Community Schools ....................... Public Education ........................................................................... 350 Poweshiek .............. Brownells, Inc. ........................................................... Firearm Accessories ..................................................................... 375 Poweshiek .............. Montezuma Manufacturing, COSMA .......................... Motor Vehicle Parts ....................................................................... 350 Hardin .................... WinField Solutions, LLC. ............................................ Fertilizers ...................................................................................... 350 Poweshiek .............. Sinclair International .................................................. Firearm Accessories ..................................................................... 340 Marshall ................. Walmart Supercenter ................................................. Retail Store ................................................................................... 300 Jasper .................... Trinity Structural Towers, Inc...................................... Turbines ........................................................................................ 270 Tama ...................... South Tama County Community Schools ................... Public Education ........................................................................... 245 Marshall ................. McFarland Clinic ........................................................ Healthcare .................................................................................... 230 Notes: (1) Source: 2018 Iowa Manufacturers database and a selected telephone survey. (2) Includes part-time employees.

The following table shows the annual average unemployment rates for certain Counties, the State and the United States. These figures are for the entire respective counties, even though only a portion of each county may be within the boundaries of the Merged Area VI.

Annual Average Unemployment Rates(1)

Calendar Hardin Marshall Poweshiek Tama State of United Year County County County County Iowa States 2010 .................................... 6.5% 6.8% 5.8% 6.4% 6.0% 9.6% 2011 .................................... 5.9% 6.6% 5.6% 6.1% 5.5% 8.9% 2012 .................................... 5.3% 6.4% 4.9% 6.0% 5.0% 8.1% 2013 .................................... 5.1% 6.0% 4.6% 5.6% 4.7% 7.4% 2014 .................................... 4.3% 5.4% 4.2% 5.3% 4.2% 6.2% 2015 .................................... 4.0% 5.1% 3.6% 4.4% 3.8% 5.3% 2016 .................................... 3.9% 4.9% 3.4% 4.2% 3.6% 4.9% 2017 .................................... 3.2% 4.6% 3.1% 3.5% 3.1% 4.4% 2018 .................................... 2.8% 4.4% 2.3% 3.0% 2.5% 3.9% 2019(2) ................................ 2.9% 3.6% 2.5% 2.5% 2.5% 3.7%

Notes: (1) Source: Iowa Workforce Development. Not seasonally adjusted. (2) For the month ending July 2019.

Income Statistics There are 14 school districts within the boundaries of the District. The following is the average adjusted gross income (AGI) per state income tax returns filed by residents of each of the school districts for the year ending December 31, 2017.


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Adjusted Gross Income (AGI) By School District in 2017(1)

Average AGI School District Adjusted Gross Income Number of Returns Per Return AGWSR ................................................. $ 88,308,953 2,635 $33,514 Alden ..................................................... 27,967,708 853 32,787 BCLUW ................................................. 77,639,797 1,933 40,165 Brooklyn-Guernsey-Malcom ................... 72,762,927 2,085 34,898 East Marshall ......................................... 77,116,760 2,108 36,583 Eldora-New Providence ......................... 74,571,255 2,155 34,604 GMG ...................................................... 38,263,852 1,013 37,773 Grinnell-Newburg ................................... 280,287,897 6,606 42,429 Hubbard-Radcliffe .................................. 62,279,362 1,607 38,755 Iowa Falls .............................................. 151,350,515 4,106 36,861 Marshalltown ......................................... 653,853,191 16,754 39,027 Montezuma ............................................ 79,364,746 1,950 40,700 South Tama County ............................... 156,917,072 4,793 32,739 West Marshall ........................................ 114,127,604 2,732 41,774 Note: (1) Source: Iowa Department of Revenue. Agriculture

Shown below are agricultural statistics of the Counties in the Merged Area VI and certain data comparing the Counties with statewide averages:

Average Value Per Acre(1) County 2014 2015 2016 2017 2018 Butler .................................................. $8,769 $8,101 $7,596 $7,806 $7,867 Franklin ............................................... 8,517 7,993 7,538 7,750 7,599 Grundy ................................................ 9,876 9,183 8,552 8,816 8,708 Hamilton ............................................. 9,779 9,193 8,589 8,861 8,576 Hardin ................................................. 8,976 8,438 7,883 8,133 7,871 Jasper................................................. 8,402 7,867 7,441 7,583 7,438 Marshall .............................................. 8,550 7,995 7,474 7,676 7,471 Poweshiek .......................................... 8,123 7,581 7,134 7,287 7,125 Story ................................................... 9,628 9,021 8,376 8,652 8,382 Tama .................................................. 8,560 7,985 7,455 7,667 7,510 State of Iowa ...................................... 7,943 7,633 7,183 7,326 7,264 Note: (1) Source: Cooperative Extension Service - Iowa State University. Retail Sales

The Department of Revenue of the State of Iowa provides retail sales figures based on sales tax reports for years ending June 30. The Department of Revenue figures provide recent data to confirm trends in retail sales activity in the Counties.

Retail Taxable Sales(1)

Year Ended June 30 County 2014 2015 2016 2017 2018 Butler ......................................... $ 59,628,005 $ 61,209,960 $ 60,623,470 $ 62,469,512 $ 60,375,801 Franklin ..................................... 71,919,245 72,839,091 69,695,118 79,968,064 84,706,477 Grundy ...................................... 68,102,884 67,682,620 68,115,548 68,117,318 67,665,441 Hamilton .................................... 102,403,175 107,536,724 108,302,165 109,568,448 111,402,344 Hardin ........................................ 156,789,230 161,802,993 162,672,301 164,757,026 171,589,735 Jasper ....................................... 317,465,229 322,564,049 320,266,647 314,856,591 326,926,218 Marshall ..................................... 353,314,461 359,189,894 380,364,703 385,858,935 388,604,364 Poweshiek ................................. 153,579,969 163,507,140 167,265,667 173,563,597 180,720,250 Story .......................................... 957,715,675 1,029,421,215 1,045,772,687 1,086,907,249 1,084,814,125 Tama ......................................... 75,690,855 78,065,747 77,983,284 76,622,455 74,794,291 Total ........................................ $2,316,608,728 $2,423,819,433 $2,461,061,590 $2,519,689,195 $2,551,599,046 Note: (1) Source: Iowa Department of Revenue.


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DEFAULT RECORD

The District has no record of default and has met its debt repayment obligations promptly.

SHORT-TERM BORROWING The District has not issued tax anticipation warrants or revenue anticipation notes during the last five years to meet its short-term current year cash flow requirements.

DEBT INFORMATION

After issuance of the Certificates, the District will have outstanding $8,120,000 principal amount of general obligation debt.

The District has a general obligation legal debt limit equal to 5% of Actual Valuation. For the January 1, 2018 Actual Valuation of $9,284,127,397 (including tax increment valuation and excluding military exemption valuation) applied to fiscal year 2019/20 the total limit is $464,206,370. Including the Certificates, the estimated principal amount of bonded and non-bonded debt applicable to this limit is $8,120,000, resulting in a net legal debt margin of $456,086,370.

The District does not expect to issue any additional general obligation debt in fiscal year 2020. However, a Bond

Referendum vote is scheduled for November 5, 2019. If approved by the voters, the District may issue additional general obligation debt in fiscal year 2020, but the amount has not been determined.

Summary of Outstanding General Obligation Bonded Debt(1) (Principal Only)

Industrial New Jobs Training Certificates: Taxable Series 2014-1 ..................................................................................... $2,350,000

Taxable Series 2015-1 ..................................................................................... 465,000 Taxable Series 2017-1 ..................................................................................... 185,000 Taxable Series 2019-1 ..................................................................................... 330,000 The Certificates ................................................................................................ 4,790,000

Total ................................................................................................................ $8,120,000

Note: (1) Source: the District.

General Obligation Debt(1) (Principal Only)

Fiscal Year Total Total General

Ending Series Series Series Series Outstanding The Obligation Cumulative Retirement June 30 2014-1 2015-1 2017-1 2019-1 GO Debt Certificates Debt Amount Percent

2020 ........... $ 470,000 $ 80,000 $ 25,000 $ 55,000 $ 630,000 $ 625,000 $1,255,000 $1,255,000 15.46% 2021 ........... 470,000 80,000 25,000 35,000 610,000 985,000 1,595,000 2,850,000 35.10% 2022 ........... 470,000 80,000 25,000 30,000 605,000 985,000 1,590,000 4,440,000 54.68% 2023 ........... 470,000 75,000 25,000 30,000 600,000 985,000 1,585,000 6,025,000 74.20% 2024 ........... 470,000 75,000 25,000 30,000 600,000 985,000 1,585,000 7,610,000 93.72% 2025 ........... 0 75,000 25,000 30,000 130,000 45,000 175,000 7,785,000 95.87% 2026 ........... 0 0 20,000 30,000 50,000 45,000 95,000 7,880,000 97.04% 2027 ........... 0 0 15,000 30,000 45,000 45,000 90,000 7,970,000 98.15% 2028 ........... 0 0 0 30,000 30,000 45,000 75,000 8,045,000 99.08% 2029 ........... 0 0 0 30,000 30,000 45,000 75,000 8,120,000 100.00% Total ......... $2,350,000 $465,000 $185,000 $330,000 $3,330,000 $4,790,000 $8,120,000

Note: (1) Source: the District. For term bonds, mandatory redemption amounts are shown.


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Statement of General Obligation Bonded Indebtedness(1)(2)

District Actual Value, January 1, 2018 .............................................................................................................................................. $9,284,127,397 District Taxable Value, January 1, 2018............................................................................................................................................ $5,342,107,547

Total Ratio to Ratio to Per Capita Applicable District Actual District Taxable (2010 Pop.

G.O. Debt Valuation Valuation Est. 92,195) Direct General Obligation Debt(3) ...................... $ 8,120,000 0.09% 0.15% $ 88.07 Less: Direct Debt Paid From Non Property Tax Sources(3) .................................. (8,120,000) (0.09%) (0.15%) (88.07) Net Direct General Obligation Debt ................. $ 0 0.00% 0.00% $ 0 Overlapping Debt: Schools ............................................................ $ 44,125,000 0.48% 0.83% $ 478.61 Cities ................................................................ 84,032,575 0.91% 1.57% 911.47 Counties ........................................................... 35,693,725 0.38% 0.67% 387.15 Total Overlapping Debt .................................... $163,851,300 1.76% 3.07% $1,777.23 Total Net Direct General Obligation and Overlapping Debt ..................................... $163,851,300 1.76% 3.07% $1,777.23

District Actual Value, January 1, 2018 Per Capita ................................................................................................................................... $100,700.99 District Taxable Value, January 1, 2018 Per Capita ................................................................................................................................ $ 57,943.57

Notes: (1) Source: the District, Audited Financial Statements and EMMA for the Cities, School Districts and Counties. (2) As of the date of issuance for the Direct Bonded Debt and August 1, 2019 for Overlapping Debt. (3) Includes all Industrial New Jobs Training Certificates which are retired by proceeds from anticipated job credits from withholding

taxes, budgeted reserves, and in the case of an insufficiency of such sources, from standby property taxes.

PROPERTY ASSESSMENT AND TAX INFORMATION Property Tax Assessment

In compliance with Section 441.21 of the Code of Iowa, as amended, the State Director of Revenue annually directs all county auditors to apply prescribed statutory percentages to the assessments of certain categories of real property. The final values, called Actual Valuation, are then adjusted by the County Auditor. Taxable Valuation subject to tax levy is then determined by the application of State determined rollback percentages, principally to residential property.

Beginning in 1978, the State required a reduction in Actual Valuation to reduce the impact of inflation on its residents. The resulting value is defined as the Taxable Valuation. Such rollback percentages may be changed in future years. Certain historical rollback percentages for residential, multi-residential, agricultural and commercial valuations are as follows:

Percentages for Taxable Valuation After Rollbacks(1)

Multi- Ag Land Fiscal Year Residential Residential(2) & Buildings Commercial

2010/11 ................ 46.9094% N/A 66.2715% 100.0000% 2011/12 ................ 48.5299% N/A 69.0152% 100.0000% 2012/13 ................ 50.7518% N/A 57.5411% 100.0000% 2013/14 ................ 52.8166% N/A 59.9334% 100.0000% 2014/15 ................ 54.4002% N/A 43.3997% 95.0000% 2015/16 ................ 55.7335% N/A 44.7021% 90.0000% 2016/17 ................ 55.6259% 86.2500% 46.1068% 90.0000% 2017/18 ................ 56.9391% 82.5000% 47.4996% 90.0000% 2018/19 ................ 55.6209% 78.7500% 54.4480% 90.0000% 2019/20 ................ 56.9180% 75.0000% 56.1324% 90.0000%

Notes: (1) Source: the Iowa Department of Revenue. (2) New category beginning with fiscal year 2017.

Property is assessed on a calendar year basis. The assessments finalized as of January 1 of each year are applied to the following tax year. For example, the assessments finalized on January 1, 2018, are used to calculate tax liability for the tax year starting July 1, 2019 through June 30, 2020.


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Property Tax Collection

Each county is required by State law to collect all tax levies within its jurisdiction and remit, before the fifteenth of each month, the amount collected through the last day of the preceding month to underlying units of government, including the District. Property tax payments are made at the office of each county treasurer in full or one-half by September 30 and March 31, pursuant to the Code of Iowa, Sections 445.36 and 445.37. Where the first half of any property tax has not been paid by October 1, such installment becomes delinquent. If the second installment is not paid, it becomes delinquent on April 1. Delinquent taxes and special assessments are subject to a penalty at the rate of one and one-half percent per month, to a maximum of eighteen percent per annum.

If taxes are not paid when due, the property may be offered at the regular tax sale on the third Tuesday of June following the delinquency date. Purchasers at the tax sale must pay an amount equal to the taxes, special assessments, interest and penalties due on the property, and funds so received are applied to the payment of taxes. A property owner may redeem from the regular tax sale, but failing redemption within two years, the tax sale purchaser is entitled to a deed which in general conveys the title free and clear of all liens except future installments of taxes.

Actual (100%) Valuations for the District(1)(2) Fiscal Year: 2015/16 2016/17 2017/18 2018/19 2019/20 Property Class Levy Year January 1: 2014 2015 2016 2017 2018 Residential .......................................................... $3,304,624,151 $3,346,375,574 $3,387,910,889 $3,564,825,656 $3,594,035,349 Agricultural .......................................................... 3,381,667,632 3,357,692,241 3,361,436,760 3,011,311,636 3,017,577,137 Commercial ......................................................... 636,314,718 583,471,486 602,824,762 617,163,970 636,029,563 Industrial ............................................................. 321,447,256 381,919,572 437,035,559 475,470,537 518,310,866 Multi-Residential(3).............................................. 0 85,454,547 87,670,948 93,773,199 102,378,083 Railroad ............................................................... 89,321,332 101,358,005 120,422,216 119,892,737 127,138,318 Utilities without Gas and Electric(4) ..................... 142,173,194 131,150,976 127,390,934 128,258,365 128,680,088 Gas and Electric Utilities(4) ................................. 584,423,314 708,547,546 882,386,832 1,017,424,086 1,168,606,442 Less: Military Exemption ..................................... (10,011,177) (9,722,689) (9,391,445) (8,991,460) (8,628,449) Total .................................................................. $8,449,960,420 $8,686,247,258 $8,997,687,455 $9,019,128,726 $9,284,127,397 Percent Change +(-) .......................................... 2.22%(5) 2.80% 3.59% 0.24% 2.94% Notes: (1) Source: the Iowa Department of Management. (2) Includes tax increment finance (TIF) valuations used in the following amounts:

January 1: 2014 2015 2016 2017 2018 TIF Valuation ............................... $317,157,782 $262,510,982 $267,171,676 $295,795,503 $268,766,829 (3) New Class as of January 1, 2015, previously reported as Commercial Property. (4) See “PROPERTY TAX INFORMATION - Utility Property Tax Replacement” herein. (5) Based on 2013 Actual Valuation of $8,266,241,452.

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For the January 1, 2018 levy year, the District’s Taxable Valuation was comprised of approximately 38% residential, 32% agriculture, 11% commercial, 9% industrial, 7% utilities, 2% railroad 1% multi-residential, and less than 1% other and military exemption.

Taxable (“Rollback”) Valuations for the District(1)(2) Fiscal Year: 2015/16 2016/17 2017/18 2018/19 2019/20 Property Class Levy Year January 1: 2014 2015 2016 2017 2018 Residential .......................................................... $1,841,782,677 $1,861,451,421 $1,929,046,079 $1,982,788,177 $2,045,653,048 Agricultural .......................................................... 1,511,676,366 1,548,124,500 1,596,668,085 1,639,598,900 1,693,838,504 Commercial ......................................................... 572,683,255 525,124,358 542,542,302 555,447,599 572,426,631 Industrial ............................................................. 289,302,540 343,727,623 393,332,029 427,923,491 466,479,798 Multi-Residential(3).............................................. 0 73,704,613 72,328,637 73,846,468 76,783,807 Railroad ............................................................... 80,389,201 91,222,209 108,379,998 107,903,463 114,424,489 Utilities without Gas and Electric(4) ..................... 142,173,194 131,150,976 127,390,935 128,881,798 128,680,090 Gas and Electric Utilities(4) ................................. 157,865,790 176,986,373 217,230,265 230,303,410 252,449,629 Less: Military Exemption ..................................... (10,011,177) (9,722,689) (9,391,445) (8,991,399) (8,628,449) Total .................................................................. $4,585,861,846 $4,741,769,384 $4,977,526,885 $5,137,701,907 $5,342,107,547 Percent Change +(-) .......................................... 2.40%(5) 3.40% 4.97% 3.22% 3.98% Notes: (1) Source: the Iowa Department of Management. (2) Includes tax increment finance (TIF) valuations used in the following amounts: January 1: 2014 2015 2016 2017 2018 TIF Valuation ............................... $260,038,117 $255,750,652 $255,957,790 $287,088,015 $261,551,403 (3) New Class as of January 1, 2015, previously reported as Commercial Property. (4) See “PROPERTY TAX INFORMATION - Utility Property Tax Replacement” herein. (5) Based on 2013 Taxable Valuation of $4,478,517,342.

Levy Year January 1, 2018 District Valuation By County(1)(2) Percent Percent 100% Actual Value of Total Taxable Value of Total Butler ................................................. $ 27,687,538 0.30% $ 15,882,791 0.30% Franklin .............................................. 435,779,731 4.69% 280,645,050 5.25% Grundy ............................................... 550,199,443 5.93% 319,125,003 5.97% Hamilton ............................................ 55,671,655 0.60% 30,950,963 0.58% Hardin ................................................ 1,737,797,460 18.72% 1,026,942,902 19.22% Jasper ................................................ 200,595,822 2.16% 111,530,364 2.09% Marshall ............................................. 3,325,064,012 35.81% 1,825,564,853 34.17% Poweshiek ......................................... 1,907,161,767 20.54% 1,128,431,858 21.12% Story .................................................. 7,016,878 0.08% 4,268,586 0.08% Tama ................................................. 1,037,153,091 11.17% 598,765,177 11.21% Total ................................................ $9,284,127,397 $5,342,107,547 Notes: (1) Source: the Iowa Department of Management. (2) Net of Military Exemption.

The following shows the trend in the District’s tax extensions and collections.

Tax Extensions and Collections(1)

Levy Collection Amount Amount Percent Year Year Levied Collected(2) Collected 2009 ............................... 2010-11 ........................ $8,058,384 $8,158,905 101.25% 2010 ............................... 2011-12 ........................ 8,025,332 7,819,243 97.43% 2011 ............................... 2012-13 ........................ 7,966,038 7,940,965 99.69% 2012 ............................... 2013-14 ........................ 7,931,954 7,643,989 96.37% 2013 ............................... 2014-15 ........................ 7,814,007 7,554,817 96.68% 2014 ............................... 2015-16 ........................ 7,944,132 8,955,930 112.74% 2015 ............................... 2016-17 ........................ 8,045,805 7,768,081 96.55% 2016 ............................... 2017-18 ........................ 6,555,216 6,093,284 92.95% 2017 ............................... 2018-19 ........................ 4,862,606 4,869,364 100.14% 2018 ............................... 2019-20 ........................ 4,491,669 --In Collection-- Notes: (1) Source: the District and the Iowa Department of Management. Includes levies and

collections for utility replacement and property taxes. (2) Includes current and delinquent taxes.


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Principal Taxpayers(1)

January 1, 2018

Taxpayer Name Business/Service Taxable Valuation(2) Interstate Power Company ........................................ Utility .............................................................................. $223,578,637 Mid American Energy Company ................................ Utility .............................................................................. 176,413,743 Union Pacific Railroad Company ............................... Railroad .......................................................................... 102,352,979 Northern Border Pipeline Company ........................... Utility .............................................................................. 51,310,328 Garden Wind LLC ...................................................... Wind Energy ................................................................... 49,581,918 Franklin County Wind LLC ......................................... Wind Energy ................................................................... 26,745,840 Monsanto Company .................................................. Agriculture ...................................................................... 26,641,671 ITC Midwest LLC. ...................................................... Utility .............................................................................. 22,644,031 Swift & Company ....................................................... Pork Processing ............................................................. 19,669,208 Fisher Controls International ...................................... Manufacturing ................................................................. 19,371,024 Total ................................................................................................................................................................. $718,309,379 Ten Largest Taxpayers as Percent of District’s 2018 Taxable Valuation $5,342,107,547 .............................................. 13.45%

Notes: (1) Source: Butler, Franklin, Grundy, Hamilton, Hardin, Jasper, Marshall, Poweshiek, Story and Tama Counties. (2) Every effort has been made to seek out and report the largest taxpayers. However, many of the taxpayers listed

contain multiple parcels and it is possible that some parcels and their valuations have been overlooked. Levy Limits

All taxable property within the Merged Area VI is taxed by each county at a rate not to exceed $0.2025 per $1,000 of assessed value on such property for the operation of the area vocational school or the area community college such as the District. In addition to the tax authorized for the operation of a merged area community college, the voters in any merged area may vote a tax not to exceed $0.2025 per $1,000 of assessed value for a period not to exceed ten years for capital improvements to the merged area (plant fund). The voters of the Merged Area VI approved the plant fund levy at elections held on September 10, 2013. The board of directors of a merged area may also certify a levy not to exceed $0.03 per $1,000 of assessed value for equipment replacement and they are authorized to levy to pay certain insurance expenses of the merged area. In addition, upon voter approval, the District can institute a property tax that generates $0.06 per $1,000 of assessed valuation (equipment levy). The voters of the District approved, at an election held in September, 2015, the Equipment Levy for a $0.06 per $1,000 of assessed valuation. The additional $0.06 per $1,000 levy can only be used for Instructional Equipment.

The property tax rates for the District from levy year 2014 through levy year 2018 are shown below:

Property Tax Rates: Levy Years 2014 - 2018(1)(2) (Per $1,000 Actual Valuation)

Fiscal Year: 2015/16 2016/17 2017/18 2018/19 2019/20 Levy Year: 2014 2015 2016 2017 2018 District: Unrestricted General Funds .......................... $0.20250 $0.20250 $0.20250 $0.20250 $0.20250 Unemployment Compensation ...................... 0.00809 0.00780 0.01906 0.00206 0.00098 Tort Liability .................................................. 0.04372 0.04431 0.04170 0.03861 0.04649 Insurance ..................................................... 0.24561 0.27180 0.29328 0.24922 0.23919 Early Retirement ........................................... 0.07860 0.07579 0.15164 0.11176 0.10243 Equipment Replacement .............................. 0.09000 0.09000 0.09000 0.09000 0.09000 Standby ........................................................ 0.00000 0.00000 0.00000 0.00000 0.00000 Plant Funds .................................................. 0.20250 0.20250 0.20250 0.20250 0.20250 Bonds and Interest Funds ............................. 0.91068 0.85035 0.36774 0.10003 0.00000 Total District ............................................... $1.78170 $1.74505 $1.36842 $0.99668 $0.88409 Note: (1) Source: Iowa Department of Management.


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Tax Levy Procedures

The Certificates are general obligations of the District, payable from and secured by a continuing ad valorem tax levied against all of the property valuation within the District. As part of the budgetary process each fiscal year, the District will have an obligation to request a debt service levy to be applied against all of the taxable property within the District. A failure on the part of the District to make a timely levy request or a levy request by the District that is inaccurate or is insufficient to make full payments of the debt service of the Certificates for a particular fiscal year may cause Certificate holders to experience delay in the receipt of distributions of principal of and/or interest on the Certificates. In the event of a default in the payment of principal of or interest on the Certificates, there is no provision for acceleration of maturity of the principal of the Certificates. Consequently, the remedies of the owners of the Certificates (consisting primarily of an action in the nature of mandamus requiring the District and certain other public officials to perform the terms of the resolution for the Certificates) may have to be enforced from year to year.

Notwithstanding the foregoing, Iowa Code section 76.2 provides when an Iowa political subdivision issues bonds, “the governing authority of these political subdivisions before issuing bonds shall, by resolution, provide for the assessment of an annual levy upon all the taxable property in the political subdivision sufficient to pay the interest and principal of the bonds within a period named not exceeding twenty years. A certified copy of this resolution shall be filed with the county auditor or auditors of the counties in which the political subdivision is located; and the filing shall make it a duty of the auditor(s) to enter annually this levy for collection from the taxable property within the boundaries of the political subdivision until funds are realized to pay the bonds in full.” Utility Property Tax Replacement Property owned by entities involved primarily in the production, delivery, service and sale of electricity and natural gas (“Utilities”) pay a replacement tax based upon the delivery of energy by Utilities in lieu of property taxes. All replacement taxes are allocated among local taxing bodies by the State Department of Revenue and the Department of Management. This allocation is made in accordance with a general allocation formula developed by the Department of Management on the basis of general property tax equivalents. Utility properties paying the replacement tax are exempt from the levy of property tax by political subdivisions. In addition to the replacement tax, Utility property will continue to be valued by a special method as provided in the statute and taxed at the rate of three cents per one thousand dollars for the general fund of the State. By statute, the replacement tax collected by the State and allocated among local taxing bodies (including the District) shall be treated as property tax when received and shall be disposed of by the county treasurer as taxes on real estate. It is possible that the general obligation debt capacity of the District could be adjudicated to be proportionately reduced in future years if Utility property were determined to be other than “taxable property” for purposes of computing the District’s debt limit under Article XI of the Constitution of the State of Iowa. There can be no assurance that future legislation will not (i) operate to reduce the amount of debt the District can issue or (ii) adversely affect the District’s ability to levy taxes in the future for the payment of the principal of and interest on its outstanding debt obligations, including the Certificates. Approximately 7% of the District’s levy year 2018 taxable valuation currently is utility property. Tax Increment Financing

The Code of Iowa currently authorizes the use of two types of tax increment financing by local taxing districts in the State of Iowa. The first type allows local governments to establish TIF districts to be established for the purposes of financing designated urban renewal projects which contribute to the urban redevelopment and economic development of the immediate area. The taxable valuation for this type of TIF district in Merged Area VI for levy year 2018 was $261,551,403.


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The second type of tax increment financing was authorized by state legislative action in the mid-1980’s. The area

community colleges can establish TIF districts by contract with specific local businesses and industries to provide jobs training programming for new employees of existing expanding businesses or employees of new businesses. The revenues from these job training TIF districts then retires the debt incurred from the issuance of jobs training certificates which finance the cost of jobs training programming over a maximum of ten years. Upon payment of all jobs training certificates, the district dissolves and the incremental value from the new or expanded business reverts to the general tax base. There is no current valuation for this second type of TIF district. Legislation From time to time, legislative proposals are pending in Congress and the Iowa General Assembly that would, if enacted, alter or amend one or more of the property tax matters described herein. It cannot be predicted whether or in what forms any of such proposals, either pending or that may be introduced, may be enacted, and there can be no assurance that such proposals will not apply to valuation, assessment or levy procedures for taxes levied by the District or have an adverse impact on the future tax collections of the District. Purchasers of the Certificates should consult their tax advisors regarding any pending or proposed federal or state tax legislation. The opinions expressed by Bond Counsel are based upon existing legislation as of the date of issuance and delivery of the Certificates and Bond Counsel has expressed no opinion as of any date subsequent thereto or with respect to any pending federal or state tax legislation.

During the 2013 legislative session, the Iowa General Assembly enacted Senate File 295 (the “2013 Act”), which the Governor signed into law on June 12, 2013. Among other things, the Act (i) reduced the maximum annual taxable value growth percent, due to revaluation of existing residential and agricultural property to 3%, (ii) assigned a “rollback” (the percentage of a property’s value that is subject to tax) to commercial, industrial and railroad property of 90%, (iii) created a new property tax classification for multi-residential properties (apartments, nursing homes, assisted living facilities and certain other rental property) and assigned a declining rollback percentage to such properties for each year until the residential rollback percentage is reached in the 2022 assessment year, after which the rollback percentage for such properties will be equal to the residential rollback percentage each assessment year, and (iv) exempted a specified portion of the assessed value of telecommunication properties.

The Act includes a standing appropriation to replace some of the tax revenues lost by local governments, including tax increment districts, resulting from the new rollback for commercial and industrial property. Beginning in fiscal year 2018 the standing appropriation cannot exceed the actual 2017 appropriation amount. The appropriation does not replace losses to local governments resulting from the Act’s provisions that reduce the annual revaluation growth limit for residential and agricultural properties to 3%, the gradual transition for multi-residential properties from the residential rollback percentage (currently 53% of market value), or the reduction in the percentage of telecommunications property that is subject to taxation.

Given the wide scope of the statutory changes, and the State’s discretion in establishing the annual replacement amount that is appropriated each year commencing in fiscal 2018, the impact of the 2013 Act on the District’s future property tax collections is uncertain and the District has not attempted to quantify the financial impact of the 2013 Act’s provisions on the District’s future operations.

Notwithstanding any decrease in property tax revenues that may result from the 2013 Act or the 2019 Act, Iowa Code section 76.2 provides that when an Iowa political subdivision issues bonds, "[t]he governing authority of these political subdivisions before issuing bonds shall, by resolution, provide for the assessment of an annual levy upon all the taxable property in the political subdivision sufficient to pay the interest and principal of the bonds within a period named not exceeding twenty years. A certified copy of this resolution shall be filed with the county auditor or the auditors of the counties in which the political subdivision is located; and the filing shall make it a duty of the auditors to enter annually this levy for collection from the taxable property within the boundaries of the political subdivision until funds are realized to pay the bonds in full."


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From time to time, other legislative proposals may be considered by the Iowa General Assembly that would, if

enacted, alter or amend one or more of the property tax matters described in this Final Official Statement. It cannot be predicted whether or in what forms any of such proposals may be enacted, and there can be no assurance that such proposals will not apply to valuation, assessment or levy procedures for the levy of taxes by the District.

FINANCIAL INFORMATION Financial Reports

The District’s financial statements are audited annually by certified public accountants. The District’s financial statements are prepared in conformity with U.S. generally accepted accounting principles as prescribed by the Governmental Accounting Standards Board. See APPENDIX A for more detail. No Consent or Updated Information Requested of the Auditor

The tables and excerpts (collectively, the “Excerpted Financial Information”) contained in this “FINANCIAL INFORMATION” section are from the audited financial statements of the District, including the audited financial statements for the fiscal year ended June 30, 2018 (the “2018 Audit”). The 2018 Audit has been prepared by Schnurr & Company, LLP, Certified Public Accountants and Consultants, Fort Dodge, Iowa, (the “Auditor”), and received by the Board of Directors. The District has not requested the Auditor to update information contained in the Excerpted Financial Information and the 2018 Audit; nor has the District requested that the Auditor consent to the use of the Excerpted Financial Information and the 2018 Audit in this Final Official Statement. The inclusion of the Excerpted Financial Information and the 2018 Audit in this Final Official Statement in and of itself is not intended to demonstrate the fiscal condition of the District since the date of the 2018 Audit. Questions or inquiries relating to financial information of the District since the date of the 2018 Audit should be directed to the District. Summary Financial Information The following tables are summaries and do not purport to be the complete audits, copies of which are available upon request. See APPENDIX A for the District’s 2018 Audit. The District expects its Current Funds – Unrestricted Balance for the fiscal year ending June 30, 2019 to increase by approximately $22,830. The District has approved a balanced budget for fiscal year 2020, to date, revenues and expenditures are generally within budgeted amounts.



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Statement of Net Position(1)

Audited as of June 30 2014 2015 2016 2017 2018

ASSETS: Current Assets: Cash and Cash Equivalents................................................ $10,378,006 $10,460,269 $10,382,043 $12,785,897 $11,033,015 Restricted Cash Reserve .................................................... 264,342 264,342 264,342 264,342 264,342 Certificates of Deposit ........................................................ 0 0 0 0 4,775,684 Receivables: Accounts (Net) ................................................................... 2,815,646 2,347,638 2,317,749 1,995,395 2,074,347 Property Tax: Delinquent ....................................................................... 786,190 2,965,734 4,623,104 3,801,493 1,971,421 Succeeding Year ............................................................. 7,814,007 7,934,780 8,036,458 6,545,448 4,161,293 Due from Other Governments ............................................. 1,914,606 1,725,924 1,291,527 1,340,725 1,358,984 Inventories .......................................................................... 402,397 304,314 346,386 405,873 326,289 Prepaid Expenses .............................................................. 481,951 478,791 481,165 455,967 568,253 Total Current Assets ........................................................ $24,857,145 $26,481,792 $27,742,774 $27,595,140 $26,533,628 NONCURRENT ASSETS: Capital Assets (Net) ............................................................ 59,824,928 60,451,482 58,692,533 57,505,173 55,121,929 Total Noncurrent Assets .................................................. 59,824,928 60,451,482 58,692,533 57,505,173 55,121,929 Total Assets ..................................................................... $84,682,073 $86,933,274 $86,435,307 $85,100,313 $81,655,557 DEFERRED OUTFLOWS OF RESOURCES: Pension Related Deferred Outflows: ................................... $ 0 $ 869,619 $ 863,907 $ 1,626,715 $ 1,609,970 OPEB Related Deferred Outflows ....................................... 0 0 0 0 153,873 Total Deferred Outflows of Resources ............................. $ 0 $ 869,619 $ 863,907 $ 1,626,715 $ 1,763,843 LIABILITIES: Current Liabilities: Accounts Payable ............................................................... $ 665,339 $ 408,804 $ 229,144 $ 380,297 $ 546,184 Salaries and Benefits Payable ............................................ 1,428,130 1,668,872 1,653,162 1,457,112 1,478,748 Accrued Interest Payable .................................................... 114,632 80,041 72,691 62,350 52,927 Advances from Grantors ..................................................... 2,725,400 2,204,764 2,034,180 2,359,713 1,958,314 Early Retirement Payable ................................................... 388,228 320,849 579,933 536,947 603,063 Compensated Absences ..................................................... 357,262 372,991 337,040 406,900 342,479 Certificates Payable ............................................................ 270,000 750,000 775,000 820,000 910,000 Notes Payable, Revenue and General Obligation Bonds .... 4,320,055 4,561,134 4,427,500 2,232,500 1,213,750 Deposits Held in Custody for Others ................................... 1,310,044 553,849 507,634 420,456 439,653 Total Current Liabilities .................................................... $11,579,090 $10,921,304 $10,616,284 $ 8,676,275 $ 7,545,118 Noncurrent Liabilities: Early Retirement Payable ................................................... $ 834,299 $ 626,974 $ 1,381,538 $ 913,400 $ 549,741 Net Pension Liability ........................................................... 0 4,212,228 5,166,945 6,324,238 5,731,973 Net OPEB Liability .............................................................. 461,205 460,700 463,347 571,698 1,069,602 Certificates Payable ............................................................ 1,055,000 4,540,000 4,485,000 3,910,000 3,000,000 Notes Payable, Revenue and General Obligation Bonds .... 18,224,884 13,793,750 9,366,250 7,133,750 5,920,000 Deposits ............................................................................. 92,800 0 0 0 0 Total Noncurrent Liabilities .............................................. $20,668,188 $23,633,652 $20,863,080 $18,853,086 $16,271,316 Total Liabilities ................................................................. $32,247,278 $34,554,956 $31,479,364 $27,529,361 $23,816,434 DEFERRED INFLOWS OF RESOURCES: Unavailable Property Tax Revenue .................................... $ 7,814,007 $ 7,934,780 $ 8,036,458 $ 6,545,448 $ 4,161,293 Pension Related Deferred Inflows....................................... 0 1,712,466 516,384 246,569 852,327 OPEB Related Deferred Inflows ......................................... 0 0 0 0 40,803 Total Deferred Inflows of Resources ................................ $ 7,814,007 $ 9,647,246 $ 8,552,842 $ 6,792,017 $ 5,054,423 NET POSITION: Net Invested in Capital Assets ............................................ $37,279,989 $42,096,598 $44,898,783 $48,138,923 $47,988,179 Restricted for: Expendable: Scholarships and Fellowships .......................................... 10,833 2,040 2,648 7,832 22,678 Cash Reserve .................................................................. 264,342 264,342 264,342 264,342 264,342 Loans .............................................................................. (3,500) (3,500) (3,500) (4,000) (3,500) Industrial New Jobs Training Program ............................. 168,096 248,811 176,160 176,160 176,160 Other ............................................................................... 2,127,648 1,760,496 1,920,232 1,831,832 2,088,825 Unrestricted ........................................................................ 4,773,380 (768,096) 8,343 1,990,561 4,011,859 Total Net Position ............................................................ $44,620,788 $43,600,691 $47,267,008 $52,405,650 $54,548,543 Note: (1) Source: Audited financial statements of the District for the fiscal years ended June 30, 2014 through 2018.


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Statement of Revenues, Expenses and Changes In Net Position(1)

Audited Fiscal Years Ended June 30 2014 2015 2016 2017 2018

OPERATING REVENUES: Tuition and Fees (Net) ...................................................... $ 6,795,115 $ 6,632,341 $ 6,846,492 $ 7,145,316 $ 7,332,705 Federal Appropriations ..................................................... 1,874,006 2,128,175 2,024,386 1,948,951 1,480,120 Iowa Industrial New Jobs Training Program ...................... 191,781 2,866,008 1,448,910 227,217 343,828 Auxiliary Enterprises Revenue .......................................... 5,200,291 4,960,778 4,935,545 5,242,913 5,485,887 Miscellaneous ................................................................... 1,870,785 1,875,715 2,261,143 2,356,825 1,623,124 Total Operating Revenues ............................................. $ 15,931,978 $ 18,463,017 $ 17,516,476 $ 16,921,222 $ 16,265,664 OPERATING EXPENSES: Education and Support: Liberal Arts and Sciences ................................................ $ 8,248,314 $ 8,047,681 $ 7,723,365 $ 7,509,562 $ 7,418,110 Career and Technical ...................................................... 3,123,923 3,520,408 3,748,037 3,259,513 3,198,320 Adult Education ............................................................... 3,719,440 3,777,356 3,596,413 2,990,999 2,622,008 Cooperative Services ...................................................... 124,136 2,641,953 1,305,891 65,567 183,849 Administration .................................................................. 3,014,272 2,962,028 4,070,314 3,022,558 3,006,218 Student Services ............................................................. 1,902,310 1,872,598 2,172,111 2,260,760 2,247,231 Learning Resources ........................................................ 344,221 368,144 314,271 324,803 276,815 Physical Plant .................................................................. 3,465,480 2,968,997 3,192,908 3,200,726 3,290,230 General Institution ........................................................... 2,815,296 2,976,277 2,819,916 2,895,738 2,893,009 Auxiliary Enterprises ......................................................... 5,229,251 5,322,457 4,859,821 4,730,310 4,992,285 Loan Cancellations and Bad Debts ................................... 183,260 98,516 111,813 137,953 189,880 Depreciation ..................................................................... 2,675,182 2,747,123 2,842,558 2,769,807 3,245,667 Total Operating Expenses ............................................. $ 34,845,085 $ 37,303,538 $ 36,757,418 $ 33,168,296 $ 33,563,622 Operating (Loss) ............................................................ $(18,913,107) $(18,840,521) $(19,240,942) $(16,247,074) $(17,297,958) NON-OPERATING REVENUES (EXPENSES): State Appropriations ......................................................... $ 10,132,422 $ 11,978,042 $ 10,617,455 $ 10,258,293 $ 10,763,787 Pell Grant ......................................................................... 4,730,249 4,441,469 3,733,454 3,644,915 3,438,958 Property Tax ..................................................................... 7,643,989 7,554,817 8,955,930 7,768,081 6,093,284 Interest Income from Investments ..................................... 7,816 20,420 47,721 75,785 93,830 (Loss) on Disposal of Capital Assets ................................ 0 0 (15,382) 0 (1,865) Interest on Indebtedness .................................................. (1,150,961) (1,020,353) (691,302) (586,872) (481,083) Net Non-Operating Revenues (Expenses) ..................... $ 21,363,515 $ 22,974,395 $ 22,647,876 $ 21,160,202 $ 19,906,911 Total Revenues and Expenses ...................................... $ 2,450,408 $ 4,133,874 $ 3,406,934 $ 4,913,128 $ 2,608,953 Transfer from Agency Fund ............................................... 345,896 248,576 259,383 225,514 133,053 Change in Net Position ...................................................... $ 2,796,304 $ 4,382,450 $ 3,666,317 $ 5,138,642 $ 2,742,006 Net Position Beginning of Year .......................................... 41,824,484 39,218,241(2) 43,600,691 47,267,008 51,806,537(2) Net Position End of Year ................................................... $ 44,620,788 $ 43,600,691 $ 47,267,008 $ 52,405,650 $ 54,548,543 Notes: (1) Source: Audited financial statements of the District for the fiscal years ended June 30, 2014 through 2018. (2) Restated.



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Balance Sheet(1)

Current Funds – Unrestricted

Audited as of June 30 2014 2015 2016 2017 2018

ASSETS AND DEFERRED OUTFLOWS OF RECOURCES: Assets: Cash and Cash Equivalents.............................................. $ 4,399,996 $ 4,699,574 $ 5,109,511 $ 5,783,797 $ 1,618,420 Certificates of Deposit ...................................................... 0 0 0 0 4,775,684 Receivables: Accounts (Net) ................................................................. 1,135,807 1,031,150 794,193 914,146 994,112 Property Tax: Delinquent ...................................................................... 10,110 9,352 9,348 9,768 6,041 Succeeding Year ............................................................ 853,692 866,627 899,072 946,350 976,082 Due from Other Governments ........................................... 56,476 34,391 44,850 84,077 33,411 Inventories ........................................................................ 402,397 304,314 346,386 405,873 326,289 Prepaid Expenses ............................................................ 459,973 457,472 459,139 438,280 551,047 Total Assets ................................................................... $7,318,451 $7,402,880 $7,662,499 $8,582,291 $9,281,086 Deferred Outflows of Resources: OPEB related Deferred Outflows ...................................... $ 0 $ 0 $ 0 $ 0 $ 132,324 Total Deferred Outflows ................................................. $ 0 $ 0 $ 0 $ 0 $ 132,324 Total Assets and Deferred Outflows of Resources ....... $7,318,451 $7,402,880 $7,662,499 $8,582,291 $9,413,410 LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND FUND BALANCES: Liabilities: Accounts Payable ............................................................ $ 140,578 $ 201,314 $ 116,105 $ 170,410 $ 263,666 Salaries and Benefits Payable ......................................... 1,425,103 1,624,664 1,565,048 1,409,165 1,456,492 Advances from Grantors .................................................. 220,540 233,350 194,618 169,106 173,408 Compensated Absences .................................................. 351,653 372,991 337,040 400,840 335,872 Total OPEB Liability ......................................................... 396,676 403,609 380,836 496,015 924,490 Total Liabilities ............................................................... $2,534,550 $2,835,928 $2,593,647 $2,645,536 $3,153,928 Deferred Inflows of Resources: Succeeding Year Property Tax ......................................... $ 853,692 $ 866,627 $ 899,072 $ 946,350 $ 976,082 OPEB related Deferred Outflows ....................................... 0 0 0 0 35,089 Total Deferred Inflows of Resources ................................ $ 853,692 $ 866,627 $ 899,072 $ 946,350 $1,011,171 Fund Balances: Auxiliary Enterprises ......................................................... $1,007,472 $ 753,610 $1,146,590 $1,896,264 $2,313,118 Unrestricted ...................................................................... 2,922,737 2,946,715 3,023,190 3,094,141 2,935,193 Total Fund Balance ....................................................... $3,930,209 $3,700,325 $4,169,780 $4,990,405 $5,248,311 Total Liabilities, Deferred Inflows of Resources and Fund Balances............................................................. $7,318,451 $7,402,880 $7,662,499 $8,582,291 $9,413,410 Note: (1) Source: Audited financial statements of the District for the fiscal years ended June 30, 2014 through 2018.



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Schedule of Revenues, Expenditures and Changes In Fund Balances (1) Current Funds – Unrestricted

Audited Fiscal Years Ended June 30 2014 2015 2016 2017 2018

REVENUES: General: Tuition and Fees .................................................................. $12,072,785 $11,690,583 $11,087,247 $11,300,324 $11,315,482 Federal Appropriations ........................................................ 156,235 142,186 147,321 148,628 116,819 State Appropriations ............................................................ 8,676,687 8,965,780 8,975,910 8,899,820 8,929,567 Property Tax ........................................................................ 865,136 854,276 875,681 908,754 956,105 Interest Income from Investments ........................................ 7,816 20,420 47,721 75,785 93,830 Miscellaneous ...................................................................... 1,083,250 1,218,976 1,266,162 1,071,094 1,025,677 Total General Revenues .................................................... $22,861,909 $22,892,221 $22,400,042 $22,404,405 $22,437,480 Auxiliary Enterprises Revenue ............................................... 5,200,291 4,960,778 4,935,545 5,242,913 5,485,887 Total Revenues .................................................................. $28,062,200 $27,852,999 $27,335,587 $27,647,318 $27,923,367 EXPENDITURES: Education and Support: Liberal Arts and Sciences .................................................... $ 8,179,634 $ 8,137,248 $ 7,720,236 $ 7,462,127 $ 7,396,323 Career and Technical .......................................................... 2,747,552 2,734,674 2,800,000 2,660,222 2,557,938 Adult Education ................................................................... 2,366,988 2,226,136 1,999,891 1,527,614 1,519,175 Administration ...................................................................... 990,365 1,145,919 1,095,674 1,090,518 956,653 Student Services ................................................................. 1,780,158 1,849,333 1,859,023 1,795,758 1,771,363 Learning Resources ............................................................ 343,585 372,912 334,859 311,983 272,540 Physical Plant ...................................................................... 2,320,602 2,289,530 2,269,501 2,076,777 1,996,124 General Institution ............................................................... 2,815,346 2,912,009 2,878,317 2,806,614 2,867,889 Total Education and Support ............................................. $21,544,230 $21,667,761 $20,957,501 $19,731,613 $19,338,005 Auxiliary Enterprises ............................................................. 5,229,251 5,322,457 4,859,821 4,730,310 4,992,285 Total Expenditures ............................................................. $26,773,481 $26,990,218 $25,817,322 $24,461,923 $24,330,290 Transfers Among Funds ........................................................ (1,083,574) (1,092,665) (1,048,810) (2,364,770) (2,805,239) Net Increase (Decrease) for the Year .................................... $ 205,145 $ (229,884) $ 469,455 $ 820,625 $ 787,838 Fund Balance Beginning of Year ........................................... 3,725,064 3,930,209 3,700,325 4,169,780 4,460,473(2) Fund Balance End of Year ..................................................... $ 3,930,209 $ 3,700,325 $ 4,169,780 $ 4,990,405 $ 5,248,311 Notes: (1) Source: Audited financial statements of the District for the fiscal years ended June 30, 2014 through 2018. (2) Restated

EMPLOYEE RETIREMENT AND OTHER POST EMPLOYMENT BENEFIT OBLIGATIONS Pensions The District participates in two public pension systems, Iowa Public Employee’s Retirement System (IPERS) and Teachers Insurance and Annuity Association – College Retirement Equities Fund (“TIAA”). Summary descriptions of each Plan follows, for more detail as to each available plan see APPENDIX A – Notes 7 and 8.

In fiscal year 2018, pursuant to the IPERS’ required rate, the District’s Regular employees contributed 5.95% of pay and the District contributed 8.93% for a total rate of 14.88%. The District’s contributions to IPERS for the year ended June 30, 2018 were $561,392. The District’s share of the contributions, payable from the applicable funds of the District, is provided by a statutorily authorized annual levy of taxes without limit or restriction as to rate or amount. The District has always made its full required contributions to IPERS.

At June 30, 2018, the District reported a liability of $5,731,973 for its proportionate share of the IPERS net pension liability. The net pension liability was measured as of June 30, 2017 and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The discount rate used to measure the total pension liability was 7%. The District’s proportion of the net pension liability was based on the District’s share of contributions to the pension plan relative to the contributions of all IPERS participating employers.


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In fiscal year 2018, pursuant to the TIAA required rate, the District is required to contribute 8.93% of annual salary,

including overtime pay, to an individual employee account. Each employee is required to contribute 5.95%. Contributions made by both the District and employees vest immediately. For the year ended June 30, 2018, employee contribution totaled $390,347 and the District recognized pension expense of $585,867. Other Post-Employment Benefits (OPEB)

The District administers a single-employer benefit plan which provided medical and prescription drug benefits for employees, retirees and their spouses. Group insurance benefits are established under Iowa Code Chapter 509A.13. No assets are accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No. 75.

The following table shows the District’s changes to the total OPEB liability:

Total OPEB Liability Beginning of year, as restated............................... $1,182,487 Changes for the year: Service Cost .......................................................................... 65,167 Interest .................................................................................. 43,423 Changes in Assumptions ....................................................... (45,477) Benefit Payments .................................................................. (175,998) Net Changes ......................................................................................... (112,885) Total OPEB Liability End of Year ........................................................... $1,069,602

See APPENDIX A – Notes (7), (8) and (11) herein for further discussion of the District’s employee retirement

benefit obligations. Defined Contribution Pension Plan – Teachers Insurance and Annuity Association – (TIAA)

The District contributes to the TIAA retirement program, which is a defined contribution pension plan. TIAA administers the retirement plan for the District. The defined contribution retirement plan provides individual annuities for each plan participant. As required by the Code of Iowa, all eligible District employees much participate in a retirement plan form the date they are employed. Defined Benefit Pension Plan – Iowa Public Employee’s Retirement System

The District also contributes to the Iowa Public Employees’ Retirement System (“IPERS”). The District’s employees are provided with pensions through a cost-sharing multiple employer defined pension plan administered by IPERS. IPERS benefits are established under Iowa Code, Chapter 97B and the administrative rules thereunder. The District’s employee who completed seven years of covered service or has reached the age of 65 while in IPERS covered employment becomes vested. If the District’s employee retires before normal retirement age, the employee’s monthly retirement benefit will be permanently reduced by an early retirement reduction. IPERS provides pension benefits as well as disability benefits to District employees and benefits to the employees’ beneficiaries upon the death of the eligible employee. Additionally, copies of IPERS annual financial report may be obtained from www.ipers.org. However, the information presented in such financial reports or on such websites is not incorporated into this Final Official Statement by any reference.

Although the actuarial contribution rates are calculated each year, the contribution rates were set by state law through June 30, 2012 and did not necessarily coincide with the actuarially calculated contribution rate. As a result, from June 30, 2002 through June 30, 2013, the rate allowed by statute was less than the actuarially required rate. Effective July 1, 2012, as a result of a 2010 law change, IPERS contribution rates for the District and its employees are established by IPERS following the annual actuarial valuation (which applies IPERS’ Contribution Rate Funding Policy and Actuarial Amortization method.) State statute, however, limits the amount rates can increase or decrease each year to one (1) percentage point. Therefore, any difference between the actuarial contribution rates and the contributions paid is due entirely to statutorily set contributions that may differ from the actual contribution rates. As a result, while the contribution rate in the fiscal year ended June 30, 2017 equaled the actuarially required rate, there is no guarantee, due to this statutory limitation on rate increases, that the contribution rate will meet or exceed the actuarially required rate in the futures.


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The following table sets forth the contributions made by the District and employees to IPERS for the period indicated.

% of Payroll % of Payroll Fiscal Year Paid by the District Paid by Employee

2015 ........................... 8.93% 5.95% 2016 ........................... 8.93% 5.95% 2017 ........................... 8.93% 5.95% 2018 ........................... 8.93% 5.95% 2019 ........................... 9.44% 6.29%

The District cannot predict the levels of funding that will be required in the future as any IPERS unfunded pension

benefit obligation could be reflected in future years in higher contribution rates. The investment of moneys, assumptions underlying the same and the administration of IPERS is not subject to the direction of the District. Thus, it is not possible to predict, control or prepare for future unfunded accrued actuarial liabilities of IPERS (“UAALs”). The UAAL is the difference between total actuarially accrued liabilities and actuarially calculated assets available for the payment of such benefits. The UAAL is based on assumptions as to retirement age, mortality, projected salary increases attributed to inflation, across-the-board raises and merit raises, adjustments, cost-of-living adjustments, valuation of current assets, investment return and other matters. Such UAAL could be substantial in the future, requiring significantly increased contributions from the District which could affect other budgetary matters.

The following table sets forth certain information about the funding status of IPERS that has been extracted from the comprehensive annual financial reports of IPERS for fiscal years ended June 30, 2014 through, and including, 2018 (collectively, the “IPERS CAFRs (2014-2018)”), and the actuarial valuation reports provided to IPERS by Cavanaugh MacDonald Consulting, LLC (collectively, the “IPERS Actuarial Reports (2014-2018)”). Additional information regarding IPERS and its latest actuarial valuations can be obtained by contacting IPERS administrative staff.

Funded Unfunded Funded UAAL as a

Unfunded Actuarial Ratio Actuarial Ratio Percentage of Accrued Liability (Actuarial Accrued Liability (Market Covered

Valuation Actuarial Value Market Value Actuarial Accrued (Actuarial Value) Value) (Market Value) Value) Covered (Actuarial Value) Date of Assets [a] of Assets [b] Liability [c] [c]-[a] [a]/[c] [c]-[b] [b]/[c] Payroll [d] {[b-a]/[c]} 2014 ..... $26,460,428,085 $28,038,549,893 $32,004,456,088 $5,544,028,003 82.68% $3,965,906,195 87.61% $7,099,277,280 78.09% 2015 ..... 27,915,379,103 28,429,834,829 33,370,318,731 5,454,939,628 83.65% 4,940,483,902 85.19% 7,326,348,141 74.46% 2016 ..... 29,033,696,587 28,326,433,656 34,619,749,147 5,586,052,560 83.86% 6,293,315,491 81.82% 7,556,515,720 73.92% 2017 ..... 30,472,423,914 30,779,116,326 37,440,382,029 6,967,958,115 81.39% 6,661,265,703 82.21% 7,863,160,443 88.62% 2018 ..... 31,827,755,864 32,314,588,595 38,642,833,653 6,815,077,789 82.36% 6,328,245,058 83.62% 7,983,219,527 85.37% Source: IPERS Reports.

According to IPERS, the market value investment return on program assets is as follows: Fiscal Year Ended Investment June 30 Return %

2014 ............................................................ 15.88% 2015 ............................................................ 3.96% 2016 ............................................................ 2.15% 2017 ............................................................ 11.70% 2018 ............................................................ 7.97%

Source: IPERS Reports

Detailed information about the pension plan’s fiduciary net position is available in the separately issue IPERS

financial report which is available on IPERS’ website at www.ipers.org.

Bond Counsel, the District and the Municipal Advisor undertake no responsibility for and make no representations as to the accuracy or completeness of the information available from TIAA or IPERS discussed above or included on the IPERS website, including, but not limited to, updates of such information on the Auditor of State’s website or links to other website site or links to other websites through the IPERS website.


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REGISTRATION, TRANSFER AND EXCHANGE

See also APPENDIX B - BOOK-ENTRY SYSTEM for information on registration, transfer and exchange of

book-entry bonds. The Certificates will be initially issued as book-entry bonds.

The District shall cause books (the “Certificate Register”) for the registration and for the transfer of the Certificates to be kept at the principal office maintained for the purpose by the Certificate Registrar in West Des Moines, Iowa. The District will authorize to be prepared, and the Certificate Registrar shall keep custody of, multiple bond blanks executed by the District for use in the transfer and exchange of Certificates.

Any Certificate may be transferred or exchanged, but only in the manner, subject to the limitations, and upon payment of the charges as set forth in the Certificate Resolution. Upon surrender for transfer or exchange of any Certificate at the principal office maintained for the purpose by the Certificate Registrar, duly endorsed by, or accompanied by a written instrument or instruments of transfer in form satisfactory to the Certificate Registrar and duly executed by the registered owner or such owner’s attorney duly authorized in writing, the District shall execute and the Certificate Registrar shall authenticate, date and deliver in the name of the registered owner, transferee or transferees (as the case may be) a new fully registered Certificate or Certificates of the same maturity and interest rate of authorized denominations, for a like aggregate principal amount.

The execution by the District of any fully registered Certificate shall constitute full and due authorization of such Certificate, and the Certificate Registrar shall thereby be authorized to authenticate, date and deliver such Certificate, provided, however, the principal amount of outstanding Certificates of each maturity authenticated by the Certificate Registrar shall not exceed the authorized principal amount of Certificates for such maturity less Certificates previously paid.

The Certificate Registrar shall not be required to transfer or exchange any Certificate following the close of business on the fifteenth day of the month next preceding an interest payment date on such bond (known as the record date), nor to transfer or exchange any Certificate after notice calling such Certificate for redemption has been mailed, nor during a period of fifteen days next preceding mailing of a notice of redemption of any Certificates.

The person in whose name any Certificate shall be registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of the principal of or interest on any Certificates shall be made only to or upon the order of the registered owner thereof or such owner’s legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Certificate to the extent of the sum or sums so paid.

No service charge shall be made for any transfer or exchange of Certificates, but the District or the Certificate Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any transfer or exchange of Certificates except in the case of the issuance of a Certificate or Certificates for the unredeemed portion of a bond surrendered for redemption.

TAXABILITY OF INTEREST General The following discussion is a summary of certain Federal income tax consequences relating to the purchase, ownership, and disposition of the Certificates. This discussion does not purport to deal with all aspects of Federal income taxation that may affect particular investors in light of their individual circumstances, and is limited to investors who hold the Certificates as capital assets under Section 1221 of the Code, which generally means property held for investment. Prospective investors, particularly those subject to special rules, should consult their tax advisors regarding the consequences of purchasing, owning, and disposing of the Certificates for Federal income tax purposes, and for State and local tax purposes.


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Interest Income Taxable In general, interest on the Certificates is includable in the gross income of the owners thereof as ordinary interest income for Federal income tax purposes. Except for original issue discount, which accrues under special rules, interest income on the Certificates is so included in the gross income of the owners when accrued or received in accordance with the owner’s regular method of Federal tax accounting. Sale, Exchange, or Other Disposition In general, upon the sale, exchange, or redemption of a Certificate, an owner will recognize taxable gain or loss in an amount equal to the difference between the amount realized and the owner’s adjusted tax basis in the Certificate. An owner’s adjusted tax basis in a Certificate generally will equal the owner’s initial cost of the Certificate, plus any accrued original issue discount and accrued market discount previously included in the owner’s taxable income. Such gain or loss generally will be capital gain or loss. Such gain or loss generally will be long-term capital gain or loss if the owner has held the Certificate for more than one year. Subject to various special rules, the Code currently provides preferential treatment for certain net long-term capital gains realized by individuals and generally limits the use by any taxpayer of capital losses to reduce ordinary income. Backup Withholding and Information Reporting In general, information reporting requirements will apply to non-corporate owners of Certificates with respect to payments of the principal of and interest on the Certificates and proceeds of sale of such Certificates before maturity. Backup withholding at a rate of 28% generally will apply to such payments unless the owner: (i) is a corporation or other exempt recipient and, when required, demonstrates that fact, or (ii) provides a correct taxpayer identification number, certifies under penalties of perjury when required that such owner is not subject to backup withholding, and has not been notified by the IRS that it has failed to report all interest and dividends required to be shown on its Federal income tax returns. Purchasers of the Certificates should consult their own tax advisors with respect to impacts of the taxability of interest. Enforcement

Holders of the Certificates shall have and possess all the rights of action and remedies afforded by the common law, the Constitution and statutes of the State of Iowa and of the United States of America for the enforcement of payment of the Certificates, including, but not limited to, the right to a proceeding in law or in equity by suit, action or mandamus to enforce and compel performance of the duties required by Iowa law and the resolutions authorizing issuance of the Certificates (the “Certificates Resolutions”.)

The practical realization of any rights upon any default will depend upon the exercise of various remedies

specified in the Certificates Resolutions. The remedies available to the owners of the Certificates upon an event of default under the Certificates Resolutions, in certain respects, may require judicial action, which is often subject to discretion and delay. Under existing law, including specifically the federal bankruptcy code, certain of the remedies specified in the Certificates Resolutions may not be readily available or may be limited. A court may decide not to order the specific performance of the covenants contained in these documents. The legal opinions to be delivered concurrently with the delivery of the Certificates will be qualified as to the enforceability of the various legal instruments by limitations imposed by general principles of equity and public policy and by bankruptcy, reorganization, insolvency or other similar laws affecting the rights of creditors generally.

No representation is made, and no assurance is given, that the enforcement of any remedies with respect to such

assets will result in sufficient funds to pay all amounts due under the Certificates Resolutions, including principal of and interest on the Certificates.


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Opinion

Bond Counsel’s opinion is not a guarantee of a result, or of the transaction on which the opinion is rendered, or of the future performance of parties to the transaction, but represents its legal judgment based upon its review of existing statutes, regulations, published rulings and court decisions and the representations and covenants of the District described in this section. No ruling has been sought from the Service with respect to the matters addressed in the opinion of Bond Counsel and Bond Counsel’s opinion is not binding on the Service. Bond Counsel assumes no obligation to update its opinion after the issue date to reflect any further action, fact or circumstance, or change in law or interpretation, or otherwise. See “APPENDIX C” for a draft form of legal opinion for the Certificates.

ALL POTENTIAL PURCHASERS OF THE CERTIFICATES SHOULD CONSULT WITH THEIR TAX ADVISORS WITH RESPECT TO FEDERAL, STATE AND LOCAL TAX CONSEQUENCES OF OWNERSHIP OF THE CERTIFICATES (INCLUDING BUT NOT LIMITED TO THOSE LISTED ABOVE).

CONTINUING DISCLOSURE

For the purpose of complying with Rule 15c2-12 of the Securities Exchange Commission, as amended and interpreted from time to time (the “Rule”), the District will covenant and agree, for the benefit of the registered holders or beneficial owners from time to time of the outstanding Certificates to provide reports of specified information and notice of the occurrence of certain events, as hereinafter described (the “Disclosure Covenants”). The information to be provided on an annual basis, and the events as to which notice is to be given, is set forth in “APPENDIX D – Form of Continuing Disclosure Certificate”. This covenant is being made by the District to assist the Underwriter(s) in complying with the Rule.

Breach of the Disclosure Covenants will not constitute a default or an “Event of Default” under the Certificates or Resolution, respectively. A broker or dealer is to consider a known breach of the Disclosure Covenants, however, before recommending the purchase or sale of the Certificates in the secondary market. Thus, a failure on the part of the District to observe the Disclosure Covenants may adversely affect the transferability and liquidity of the Certificates and their market price.

Pursuant to the Rule, in the last five years, the District believes it has complied in all material respects with regard to its prior Disclosure Covenants.

Bond Counsel expresses no opinion as to whether the Undertaking complies with the requirements of Section (b)(5) of the Rule.

OPTIONAL REDEMPTION

Certificates due June 1, 2020 - 2025 inclusive, are not subject to optional redemption. Certificates due June 1, 2026 - 2029, inclusive, are callable in whole or in part on any date on or after June 1, 2025, at a price of par and accrued interest. If selection by lot within a maturity is required, the Registrar shall designate the Certificates to be redeemed by random selection of the names of the registered owners of the entire annual maturity until the total amount of Certificates to be called has been reached.

If less than all of the maturity is called for redemption, the District will notify DTC of the particular amount of such

maturity to be redeemed prior to maturity. DTC will determine by lot the amount of each Participant’s interest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed.


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Thirty days’ written notice of redemption shall be given to the registered owner of the Certificate. Failure to give

written notice to any registered owner of the Certificates or any defect therein shall not affect the validity of any proceedings for the redemption of the Certificates. All Certificates or portions thereof called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment. Written notice will be deemed completed upon transmission to the owner of record.

MANDATORY REDEMPTION The Certificate coming due on June 1, 2029 is a term certificate (the “Term Certificate”) and is subject to mandatory redemption prior to maturity on June 1 of the years and in the amounts as follows: $225,000; 2.350% Term Certificate Due June 1, 2029; Yield 2.350%: Redemption Year Amount 2025 ............... $45,000 2026 ............... 45,000 2027 ............... 45,000 2028 ............... 45,000 2029 ............... 45,000 (stated maturity)

The College covenants that it will redeem Term Certificate pursuant to the mandatory redemption requirement for such Term Certificate. Proper provision for mandatory redemption having been made, the College covenants that the Term Certificate so selected for redemption shall be payable as at maturity.

LITIGATION

There is no litigation of any nature now pending or threatened restraining or enjoining the issuance, sale, execution or delivery of the Certificates, or in any way contesting or affecting the validity of the Certificates or any proceedings of the District taken with respect to the issuance or sale thereof. There is no litigation now pending, or to the knowledge of the District, threatened against the District that is expected to materially impact the financial condition of the District.

LEGAL MATTERS The Certificates are subject to approval as to certain legal matters by Ahlers & Cooney, P.C., Des Moines, Iowa, as Bond Counsel. Bond Counsel has not participated in the preparation of this Final Official Statement except for guidance concerning the sections regarding “DESCRIPTION OF THE CERTIFICATES” and “TAXABILITY OF INTEREST” and will not pass upon its accuracy, completeness, or sufficiency. Bond Counsel has not examined nor attempted to examine or verify any of the financial or statistical statements, or data contained in this Final Official Statement, and will express no opinion with respect thereto. A legal opinion in substantially the form set forth in APPENDIX C to this Final Official Statement will be delivered at closing.

The legal opinion to be delivered concurrently with the delivery of the Certificates expresses the professional judgment of the attorneys rendering the opinion as to legal issues expressly addressed therein. By rendering a legal opinion, the opinion giver does not become an insurer or guarantor of the result indicated by that expression of professional judgment, or of the transaction on which the opinion is rendered, or of the future performance of parties to the transaction. Nor does the rendering of an opinion guarantee the outcome of any legal dispute that may arise out of the transaction.


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In addition, the enforceability of the rights and remedies of owners of the Certificates may be subject to limitation

as set forth in the Bond Counsel’s opinion. The opinion will state, in part, that the obligation of the District with respect to the Certificates may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights heretofore or hereafter enacted to the extent constitutionally applicable, and to the exercise of judicial discretion in appropriate cases.

FINAL OFFICIAL STATEMENT AUTHORIZATION

This Final Official Statement has been authorized for distribution to prospective purchasers of the Certificates. All statements, information, and statistics herein are believed to be correct but are not guaranteed by the consultants or by the District, and all expressions of opinion, whether or not so stated, are intended only as such.

This Final Official Statement is not to be construed as a contract or agreement amongst the District, the Underwriter, or the holders of any of the Certificates. Any statements made in this Final Official Statement involving matters of opinion, whether or not expressly so stated, are intended merely as opinions and not as representations of fact. The information and expressions of opinions contained herein are subject to change without notice and neither the delivery of this Final Official Statement or the sale of the Certificates made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the District since the date hereof. The information contained in this Final Official Statement is not guaranteed.

INVESTMENT RATING

The Certificates have been rated “Aa3” by Moody’s Investors Service. The District has supplied certain information and material concerning the Certificates and the District to the rating service shown on the cover page, including certain information and materials which may not have been included in this Final Official Statement, as part of its application for an investment rating on the Certificates. A rating reflects only the views of the rating agency assigning such rating and an explanation of the significance of such rating may be obtained from such rating agency. Generally, such rating service bases its rating on such information and material, and also on such investigations, studies and assumptions that it may undertake independently. There is no assurance that such rating will continue for any given period of time or that it may not be lowered or withdrawn entirely by such rating service if, in its judgment, circumstances so warrant. Any such downward change in or withdrawal of such rating may have an adverse effect on the secondary market price of the Certificates. An explanation of the significance of the investment rating may be obtained from the rating agency: Moody’s Investors Service, 7 World Trade Center at 250 Greenwich Street, New York, New York 10007, telephone 212-553-1658.

UNDERWRITING

The Certificates were offered for sale by the District at a public, competitive sale on October 9, 2019. The best bid submitted at the sale was submitted by Piper Jaffray & Co., Minneapolis, Minnesota (the “Underwriter”). The District awarded the contract for sale of the Certificates to the Underwriter at a price of $4,774,488.30 (reflecting the par amount of $4,790,000.00, plus a reoffering premium of $2,738.30, and less an Underwriter’s discount of $18,250.00). The Underwriter has represented to the District that the Certificates have been subsequently re-offered to the public initially at the yields or prices set forth in the Final Official Statement.


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MUNICIPAL ADVISOR

The District has engaged Speer Financial, Inc. as municipal advisor (the “Municipal Advisor”) in connection with the issuance and sale of the Certificates. The Municipal Advisor is a Registered Municipal Advisor in accordance with the rules of the MSRB. The Municipal Advisor will not participate in the underwriting of the Certificates. The financial information included in the Final Official Statement has been compiled by the Municipal Advisor. Such information does not purport to be a review, audit or certified forecast of future events and may not conform with accounting principles applicable to compilations of financial information. The Municipal Advisor is not a firm of certified public accountants and does not serve in that capacity or provide accounting services in connection with the Certificates. The Municipal Advisor is not obligated to undertake any independent verification of or to assume any responsibility for the accuracy, completeness or fairness of the information contained in this Final Official Statement, nor is the Municipal Advisor obligated by the District’s continuing disclosure undertaking.

CERTIFICATION

I have examined this Final Official Statement dated October 9, 2019, for the $4,790,000 Taxable Industrial New Jobs Training Certificates, Series 2019-2, believe it to be true and correct and will provide to the purchaser of the Certificates at the time of delivery a certificate confirming to the purchaser that to the best of our knowledge, information and belief, information in the Official Statement was at the time of acceptance of the bid for the Certificates and, including any addenda thereto, was at the time of delivery of the Certificates true and correct in all material respects and does not include any untrue statement of a material fact, nor does it omit the statement of any 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. /s/ KATHLEEN PINK Vice Chancellor of District Finance/Chief Financial Officer IOWA VALLEY COMMUNITY COLLEGE DISTRICT (Merged Area VI) Marshalltown, Iowa


APPENDIX A

IOWA VALLEY COMMUNITY COLLEGE DISTRICT, IOWA (MERGED AREA VI)

FISCAL YEAR 2018 AUDITED FINANCIAL STATEMENTS

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LEFT BLANK

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IOWA VALLEY COMMUNITY COLLEGE DISTRICT

INDEPENDENT AUDITOR’S REPORTS BASIC FINANCIAL STATEMENTS AND

SUPPLEMENTARY INFORMATION SCHEDULE OF FINDINGS AND

QUESTIONED COSTS

June 30, 2018

TABLE OF CONTENTS

Page

Officials 1

Independent Auditor’s Report 2-4

Management’s Discussion and Analysis 5-12

Basic Financial Statements: Exhibit Statement of Net Position A 13-14

Statement of Revenues, Expenses and Changes in Net Position B 15-16 Statement of Cash Flows C 17-18 Component Unit Financial Statements:

Statement of Net Assets D 19 Statement of Revenues, Expenses and Changes in Net Assets E 20

Notes to Financial Statements 21-42

Required Supplementary Information: Schedule of the District’s Proportionate Share of the Net Pension Liability 43 Schedule of District Contributions 44 Notes to Required Supplementary Information – Pension Liability 45 Schedule of Changes in the District’s Total OPEB Liability, Related Ratios and Notes 46

Supplementary Information: Schedule Notes to Supplementary Information 47-48 Budgetary Comparison Schedule of Expenditures – Budget to Actual 1 49 Balance Sheet – All Funds 2 50-51 Schedule of Revenues, Expenditures and Changes in Fund Balances – All Funds 3 52-53 Unrestricted funds:

Schedule of Revenues, Expenditures and Changes in Fund Balances – Education and Support 4 54

Schedule of Revenues, Expenditures and Changes in Fund Balances – Auxiliary Enterprises 5 55

Schedule of Revenues, Expenditures and Changes in Fund Balances – Restricted Fund 6 56 Schedule of Changes in Deposits Held in Custody for Others – Agency Funds 7 57 Schedule of Credit and Contact Hours 8 58 Schedule of Tax and Intergovernmental Revenues 9 59 Schedule of Current Fund Revenues by Source and Expenditures by Function 10 60 Schedule of Expenditures of Federal Awards 11 61-62

TABLE OF CONTENTS (Continued)

Page

Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 63-64 Independent Auditor’s Report on

Compliance for Each Major Federal Program and on Internal Control over Compliance Required by the Uniform Guidance 65-66

Schedule of Findings and Questioned Costs 67-68

1

OFFICIALS

Term Name Title Expires

Board of Directors

Larry Johnson President 2019 Paul Pohlson Vice President 2019 Deborah Crosser Member 2019 Deborah Jones Member 2021 Delbert Kellogg Member 2021 Joanna Hofer Member 2021 Chris Brodin Member 2019

Community College

Dr. Christopher Duree Chancellor Kathleen Pink Chief Financial Officer and Board Treasurer Barbara Jennings Board Secretary

2

SCHNURR & COMPANY, LLP Certified Public Accountants and Consultants

Independent Auditor’s Report

To the Board of Directors of Iowa Valley Community College District Marshalltown, Iowa

Report on the Financial Statements We have audited the accompanying financial statements of Iowa Valley Community College District, Marshalltown, Iowa, as of and for the year ended June 30, 2018, its aggregate discretely presented component units as of and for the year ended December 31, 2017, and the related Notes to Financial Statements, which collectively comprise the District’s basic financial statements listed in the table of contents.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with 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 statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express opinions on these financial statements based on our audit. We did not audit the financial statements of Marshalltown Community College District Foundation, one of the component units of the District discussed in Note 1. Those financial statement were audited by other auditors whose reports have been furnished to us, and our opinion, insofar as it relates to those units, is based solely on the reports of other auditors. We conducted our audit in accordance with U.S. generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. The financial statements of the component units were not audited in accordance with Government Auditing Standards.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the District’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

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Opinion

In our opinion, based on our audit and the reports of the other auditors, the financial statements referred to above present fairly, in all material respects, the respective financial position of Iowa Valley Community College District as of June 30, 2018, its aggregate discretely presented component units as of December 31, 2017, and the respective changes in financial position and, where applicable, its cash flows thereof for the years then ended in accordance with U.S. generally accepted accounting principles.

Emphasis of a Matter

As discussed in Note 15 to the financial statements, Iowa Valley Community College District adopted new accounting guidance related to Governmental Accounting Standards Board (GASB) Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions. Our opinions are not modified with respect to this matter.

Other Matters

Required Supplementary Information

U.S. generally accepted accounting principles require Management’s Discussion and Analysis, the Schedule of the District’s Proportionate Share of the Net Pension Liability, the Schedule of District Contributions and the Schedule of Changes in the District’s Total OPEB Liability, Related Ratios and Notes on pages 5 through 12, 43 through 46, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board which considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. We have applied certain limited procedures to the required supplementary information in accordance with U.S. generally accepted auditing standards, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Supplementary Information

Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise Iowa Valley Community College District’s basic financial statements. We, and other auditors, previously audited, in accordance with the standards referred to in the third paragraph of this report, the financial statements for the nine years ended June 30, 2017 (which are not presented herein) and expressed unmodified opinions on those financial statements. The supplementary information included in Schedules 1 through 11, including the Schedule of Expenditures of Federal Awards required by Title 2, U.S. Code of Federal Regulations, Part 200, Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance), is presented for purposes of additional analysis and is not a required part of the basic financial statements.

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The supplementary information is the responsibility of Iowa Valley Community College District’s management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with U.S. generally accepted auditing standards by us. In our opinion, based on our audit and the procedures performed as described above, the supplementary information is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated December 7, 2018 on our consideration of Iowa Valley Community College District’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing and not to provide an opinion on the effectiveness of the District’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Iowa Valley Community College District’s internal control over financial reporting and compliance.

Fort Dodge, Iowa December 7, 2018

IOWA VALLEY COMMUNITY COLLEGE DISTRICT MANAGEMENT’S DISCUSSION AND ANALYSIS

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Management of Iowa Valley Community College District (the District) provides this Management’s Discussion and Analysis of the District’s annual financial statements. This narrative overview and analysis of the financial activities is for the fiscal year ended June 30, 2018. We encourage readers to consider this information in conjunction with the District’s financial statements, which follow.

2018 FINANCIAL HIGHLIGHTS • The District implemented Governmental Accounting Standards Board Statement No. 75, Accounting and

Financial Reporting for Postemployment Benefits Other Than Pensions, during fiscal year 2018. The beginning net position was restated by $599,113 to retroactively report the increase in the OPEB liability as of July 1, 2017. OPEB expense for fiscal year 2017 and deferred outflows of resources at June 30, 2017 were not restated because the information needed to restate those amounts was not available.

• District operating revenues decreased approximately $656,000 compared to 2017. This occurred as a combination of decreases in federal appropriations and miscellaneous revenue offset by increases to tuition and fees and Iowa Industrial New Jobs Training Program.

• District operating expenses increased 3.9%, or approximately $395,000 compared to fiscal year 2017. The increase was primarily due to increases in physical plant, cooperative services and auxiliary enterprises; and decreases in Liberal Arts, Career and Technical, Adult Education, Administration, Student Services, learning resources and general institution.

• The District’s net position increased 4.09%, or approximately $2,143,000 from fiscal year 2017.

USING THIS ANNUAL REPORT The annual report consists of a series of financial statements and other information, as follows:

Management’s Discussion and Analysis introduces the basic financial statements and provides an analytical overview of the District’s financial activities.

The Basic Financial Statements consist of a Statement of Net Position, a Statement of Revenues, Expenses and Changes in Net Position and a Statement of Cash Flows. These provide information about the activities of the District as a whole and present an overall view of the District’s finances.

Notes to Financial Statements provide additional information essential to a full understanding of the data provided in the basic financial statements.

Required Supplementary Information presents the District’s proportionate share of the net pension liability and related contributions, as well as presenting the Schedule of Changes in the District’s Total OPEB Liability, Related Ratios and Notes.

Supplementary Information provides detailed information about the individual funds. The Budgetary Comparison Schedule of Expenditures – Budget to Actual further explains and supports the financial statements with a comparison of the District’s budget for the year. The Schedule of Expenditures of Federal Awards provides details of various federal programs benefiting the District.

MANAGEMENT’S DISCUSSION AND ANALYSIS

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REPORTING THE DISTRICT’S FINANCIAL ACTIVITIES The Statement of Net Position

The Statement of Net Position presents financial information on all of the District’s assets, deferred outflows of resources, liabilities and deferred inflows of resources, with the difference reported as net position. The Statement of Net Position is a point-in-time financial statement. The purpose of this statement is to present a fiscal snapshot of the District to the readers of the financial statements. The Statement of Net Position includes year-end information concerning current and noncurrent assets, deferred outflows of resources, current and noncurrent liabilities, deferred inflows of resources and net position. Over time, readers of the financial statements will be able to determine the District’s financial position by analyzing the increases and decreases in net position. This statement is also a good source for readers to determine how much the District owes to outside vendors and creditors. The statement also presents the available assets that can be used to satisfy those liabilities.

20182017

(Not Restated)Current and other assets 26,533,628 $ 27,595,140 $ Capital assets, net of accumulated depreciation 55,121,929 57,505,173

Total assets 81,655,557 85,100,313

Deferred outflows of resources 1,763,843 1,626,715

Current liabilities 7,545,118 8,676,275 Noncurrent liabilities 16,271,316 18,853,086

Total liabilities 23,816,434 27,529,361

Deferred inflows of resources 5,054,423 6,792,017

Net position:Net investment in capital assets 47,988,179 48,138,923 Restricted 2,548,505 2,276,166 Unrestricted 4,011,859 1,990,561

Total net position 54,548,543 $ 52,405,650 $

Net Position

June 30,


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REPORTING THE DISTRICT’S FINANCIAL ACTIVITIES (CONTINUED)

Comparison of Net Position

The largest portion of the District’s net position 88.0% is invested in capital assets (e.g., land, buildings, and equipment), less the related debt. The debt related to the capital assets is liquidated with resources other than capital assets. The restricted portion of the net position 4.7% includes resources subject to external restrictions, constitutional provisions or enabling legislation on how they can be used. The remaining net position is the unrestricted net position that can be used to meet the District’s obligations as they come due.

Fiscal Year 2018: The District made principal payments on certificates, bonds and notes payable totaling approximately $3,052,000 during fiscal year 2018 and made no additional borrowings. Fiscal Year 2017: The District made principal payments on certificates, bonds and notes payable totaling approximately $5,200,000 during fiscal year 2017 and made additional borrowings of $245,000 in New Jobs Training bonds.

Statement of Revenues, Expenses and Changes in Net Position

Changes in total net position presented in the Statement of Net Position are based on the activity presented in the Statement of Revenues, Expenses, and Changes in Net Position. The purpose of the statement is to present the revenues of the District, both operating and non-operating, the expenses incurred by the District, both operating and non-operating, and any other revenues, expenses, gains and losses received or spent by the District. In general, a public college, such as Iowa Valley Community College District will report an operating loss since the financial reporting model classifies state appropriations and property tax as non-operating revenues. Operating revenues are received for providing goods and services to the students, customers and constituencies of the District. Operating expenses are those expenses paid to acquire or produce the goods and services provided in return for the operating revenues and to carry out the mission of the District. Non-operating revenues are revenues received for which goods and services are not provided. The utilization of capital assets is reflected in the financial statements as depreciation, which allocates the cost of an asset over its expected useful life.


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Statement of Revenues, Expenses and Changes in Net Position (Continued) The Statement of Revenues, Expenses and Changes in Net Position reflects an increase of 5.29% or approximately $2,742,000, in net position at the end of the fiscal year.

20182017

(Not Restated)Operating revenues:

Tuition and fees 7,332,705 $ 7,145,316 $ Federal appropriations 1,480,120 1,948,951 Iowa Industrial New Jobs Training Program 343,828 227,217 Auxiliary 5,485,887 5,242,913 Miscellaneous 1,623,124 2,356,825

Total operating revenues 16,265,664 16,921,222

Total operating expenses 33,563,622 33,168,296

Operating (loss) (17,297,958) (16,247,074)

Non-operating revenues (expenses):State appropriations 10,763,787 10,258,293 Pell grant 3,438,958 3,644,915 Property tax 6,093,284 7,768,081 Interest income from investments 93,830 75,785 (Loss) on disposal of capital assets (1,865) - Interest on indebtedness (481,083) (586,872)

Net non-operating revenues 19,906,911 21,160,202

Transfers from agency fund 133,053 225,514

Increase in net position 2,742,006 5,138,642

Net position beginning of year, as restated 51,806,537 47,267,008

Net position end of year 54,548,543 $ 52,405,650 $

Changes in Net Position

Year Ended June 30,


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Total Revenue by Source

In fiscal year 2018, operating revenues decreased by approximately $656,000. The following factors represent the significant changes: • Tuition and fees increased approximately $187,000, NJTP increased approximately $117,000, auxiliary

enterprises revenue increased approximately $243,000, federal appropriations decreased approximately $469,000, and miscellaneous revenue decreased approximately $928,000.

2018 2017Education and Support:

Liberal arts and sciences 7,418,110 $ 7,509,562 $ Career and technical 3,198,320 3,259,513 Adult education 2,622,008 2,990,999 Cooperative services 183,849 65,567 Administration 3,006,218 3,022,558 Student services 2,247,231 2,260,760 Learning resources 276,815 324,803 Physical plant 3,290,230 3,200,726 General institution 2,893,009 2,895,738

Auxiliary enterprises 4,992,285 4,730,310 Loan cancellations and bad debt 189,880 137,953 Depreciation 3,245,667 2,769,807

33,563,622 $ 33,168,296 $

Operating Expenses

Year Ended June 30,

Total Expenses

In fiscal year 2018, operating expenses increased by approximately $395,000. The following factors represent the significant changes:

• Cooperative service costs increased approximately $118,000, physical plant increased approximately $90,000 and auxiliary enterprises costs increased approximately $262,000.

Statement of Cash Flows

The Statement of Cash Flows is an important tool in helping users assess the District’s ability to generate future net cash flows, its ability to meet its obligations as they come due, and its need for external financing. The Statement of Cash Flows presents information related to cash inflows and outflows, summarized by operating, non-capital financing, capital and related financing and investing activities.


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Statement of Cash Flows (Continued)

2018 2017Cash provided by (used by):

Operating activities (14,953,761) $ (13,166,007) $ Non-capital financing activities 22,290,027 22,631,236 Capital and related financing activities (4,407,295) (7,137,159) Investing activities (1,109,854) (3,496,215)

Net increase (decrease) in cash 1,819,117 (1,168,145)

Cash beginning of year 9,478,240 10,646,385

Cash end of year 11,297,357 $ 9,478,240 $

Year Ended June 30,

Cash Flows

Cash used by operating activities includes tuition, fees, operating grants and contracts, net of payments to employees and to suppliers. Cash provided by non-capital financing activities includes state appropriations, Pell grant, local property tax received by the District, and the receipt and disbursement of federal direct loan program proceeds. Cash used by capital and related financing activities represents the proceeds from debt, the principal and interest payments on debt and the purchase of capital assets. Cash provided by investing activities includes investment income received.

CAPITAL ASSETS AND DEBT ADMINISTRATION

Capital Assets At June 30, 2018, the District had approximately $55 million invested in capital assets, net of accumulated depreciation of approximately $40 million. Depreciation charges totaled $3,245,667 for fiscal year 2018. Details of the capital assets are shown below:

2018 2017Land 3,463,786 $ 3,463,786 $ Construction in progress 520,830 - Buildings 48,317,416 50,513,234 Improvements other than buildings 921,847 970,685 Equipment and vehicles 1,898,050 2,557,468

Totals 55,121,929 $ 57,505,173 $

Capital Assets, Net, At Year-End

June 30,

More detailed information about the District’s capital assets is presented in Note 4 to the financial statements.


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CAPITAL ASSETS AND DEBT ADMINISTRATION (CONTINUED) Debt At June 30, 2018, the District had approximately $11,044,000 in debt outstanding, a decrease of approximately $3,000,000 from fiscal year 2017. The table below summarizes these amounts by type.

2018 2017Certificates payable 3,910,000 $ 4,730,000 $ Notes payable and revenue bonds 7,133,750 9,366,250

11,043,750 $ 14,096,250 $

June 30,

Outstanding Debt

More detailed information about the District’s outstanding debt is presented in Note 5 to the basic financial statements.

ECONOMIC FACTORS Iowa Valley Community College District experienced an increase in the unrestricted general operating fund net position of approximately $343,000. This is an approximate increase of $272,000 from the previous fiscal year’s increase in unrestricted general operating fund net position of approximately $71,000. Approximately $268,000 of this increase is due to a change in reporting of the GASB 75 liability. Economic factors and trends that continue to draw a great deal of scrutiny by the District are:

• All state appropriations increased approximately $500,000 in fiscal year 2018, an increase of approximately 4.90%.

• Property tax valuations increased approximately $235,550,000 or 5.25% for the 2018 collection year.

• Property tax from the 0.2025 fixed-rate levy comprised 4.20% of general operating fund revenue in fiscal year 2018.

• Tuition and fee revenue collections in the general operating fund were consistent and are the largest source of revenue for the fund, representing 50.00% of the total general operating fund revenues. While it is a significant amount of revenue, it is difficult to predict and budget due to the many variables that impact actual enrollment and the tuition and fees generated. Continued tuition rate increases create hardships for individuals seeking a college education and access to life-long learning opportunities.

• Student enrollment for fiscal year 2018 had a decrease of 2.40% in credit hours as compared to fiscal year 2017. In 2017 there was a decrease in credit hours of approximately 5.5%. The District must continue to be aggressive in recruiting and retaining students. The impact of enrollment on the fiscal condition of the District is significant and immediate.


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ECONOMIC FACTORS (CONTINUED)

• Industrial New Jobs Training (260E) Projects have provided valuable resources for area business and industry for the expansion and training of their labor forces. With the downturn of the economy in recent years, it has become increasingly difficult for area businesses and industries to meet long-term debt obligation commitments for the 260E projects. This is an area of concern that is continually monitored by the District.

• Labor costs to include health insurance represent 71.00% of expenditures in the unrestricted general operating fund. Labor costs increased as a result of the collective bargaining negotiated settlement and increase to non-bargaining employees.

• Utilities, custodial, and maintenance costs continue to rise primarily due to recent construction projects that have added a significant increase in physical plant square footage. Utility costs are funded by the fixed rate Plant Fund levy and transfers from the Unrestricted General Operating Fund. Management is utilizing more of the unrestricted operating fund to pay for utilities, which allows for more of the plant fund levy to be used for necessary maintenance and infrastructure expenditures.

CONTACTING THE DISTRICT’S FINANCIAL MANAGEMENT

This financial report is designed to provide our customers, taxpayers in the community college district and our creditors with a general overview of the District’s finances and to demonstrate the District’s accountability for the resources it receives. If you have questions about the report or need additional financial information, contact Iowa Valley Community College District, 3702 South Center Street, Marshalltown, Iowa 50158.

BASIC FINANCIAL STATEMENTS

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STATEMENT OF NET POSITIONJune 30, 2018

AssetsPrimary

InstitutionCurrent Assets:

Cash and cash equivalents 11,033,015 $ Restricted cash reserve 264,342 Certificates of deposit 4,775,684 Receivables:

Accounts, net of allowance of $6,102,253 2,074,347 Property tax:

Delinquent 1,971,421 Succeeding year 4,161,293

Due from other governments 1,358,984 Inventories 326,289 Prepaid expenses 568,253

Total current assets 26,533,628

Noncurrent Assets:Capital assets, net of accumulated depreciation 55,121,929

Total noncurrent assets 55,121,929

Total assets 81,655,557

Deferred Outflows of ResourcesPension related deferred outflows 1,609,970 OPEB related deferred outflows 153,873

Total deferred outflows of resources 1,763,843

(Continued on next page)

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Exhibit A

LiabilitiesPrimary

InstitutionCurrent Liabilities:

Accounts payable 546,184 $ Salaries and benefits payable 1,478,748 Accrued interest payable 52,927 Advances from grantors 1,958,314 Early retirement payable 603,063 Compensated absences 342,479 Certificates payable 910,000 Notes payable, revenue and general obligation bonds 1,213,750 Deposits held in custody for others 439,653

Total current liabilities 7,545,118

Noncurrent Liabilities:Early retirement payable 549,741 Net pension liability 5,731,973 Total OPEB liability 1,069,602 Certificates payable 3,000,000 Notes payable, revenue and general obligation bonds 5,920,000

Total noncurrent liabilities 16,271,316

Total liabilities 23,816,434

Deferred Inflows of ResourcesUnavailable property tax revenue 4,161,293 Pension related deferred inflows 852,327 OPEB related deferred inflows 40,803

Total deferred inflows of resources 5,054,423

Net Position:Net investment in capital assets 47,988,179 Restricted for:

Expendable:Scholarships and fellowships 22,678 Cash reserve 264,342 Loans (3,500) Iowa Industrial New Jobs Training Program 176,160 Other 2,088,825

Unrestricted 4,011,859

Total net position 54,548,543 $

See Notes to Financial Statements.

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IOWA VALLEY COMMUNITY COLLEGE DISTRICT Exhibit B

Year Ended June 30, 2018

PrimaryInstitution

Operating revenues:Tuition and fees, net of scholarship allowances of $3,982,777 7,332,705 $ Federal appropriations 1,480,120 Iowa Industrial New Jobs Training Program 343,828 Auxiliary enterprises revenue 5,485,887 Miscellaneous 1,623,124

Total operating revenues 16,265,664

Operating expenses:Education and support:

Liberal arts and sciences 7,418,110 Career and technical 3,198,320 Adult education 2,622,008 Cooperative services 183,849 Administration 3,006,218 Student services 2,247,231 Learning resources 276,815 Physical plant 3,290,230 General institution 2,893,009

Auxiliary enterprises 4,992,285 Loan cancellations and bad debt 189,880 Depreciation 3,245,667

Total operating expenses 33,563,622

Operating (loss) (17,297,958)

STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION


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IOWA VALLEY COMMUNITY COLLEGE DISTRICT Exhibit B

(Continued)


PrimaryInstitution

Non-operating revenues (expenses):State appropriations 10,763,787 $ Pell grant 3,438,958 Property tax 6,093,284 Interest income from investments 93,830 (Loss) on disposal of capital assets (1,865) Interest on indebtedness (481,083)

Net non-operating revenues 19,906,911

2,608,953

Transfers from agency fund 133,053

Change in net position 2,742,006

Net position beginning of year, as restated 51,806,537

Net position end of year 54,548,543 $


-

STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION

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IOWA VALLEY COMMUNITY COLLEGE DISTRICT Exhibit C

PrimaryInstitution

Cash Flows from Operating Activities:Cash received from tuition and fees 7,471,959 $ Cash received from federal appropriations 1,569,591 Cash received from Iowa Industrial New Jobs Training Program 343,828 Payments to employees for salaries and benefits (19,957,937) Payments to suppliers for goods and services (10,762,877) Auxiliary enterprises 5,485,887 Other receipts 895,788

Net cash (used by) operating activities (14,953,761)

Cash Flows from Non-Capital Financing Activities: Transfers from agency funds 133,053 State appropriations 10,763,787 Pell grant 3,438,958 Property tax 7,923,356 Federal direct lending receipts 4,935,362 Federal direct lending disbursements (4,935,362) Miscellaneous Agency Fund receipts 1,142,938 Miscellaneous Agency Fund disbursements (1,112,065)

Net cash provided by non-capital financing activities 22,290,027

Cash Flows from Capital and Related Financing Activities:Proceeds from sale of capital assets 1,550 Acquisition of capital assets (865,839) Principal paid on debt (3,052,500) Interest paid on debt (490,506)

Net cash (used by) capital and related financing activities (4,407,295)

Cash Flows from Investing Activities:Purchase of investments (1,203,684) Interest from investments 93,830

Net cash (used by) investing activities (1,109,854)

Net increase in cash 1,819,117

Cash and cash equivalents beginning of year 9,478,240

Cash and cash equivalents end of year 11,297,357 $

STATEMENT OF CASH FLOWSYear Ended June 30, 2018


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IOWA VALLEY COMMUNITY COLLEGE DISTRICT Exhibit C

(Continued)STATEMENT OF CASH FLOWS

PrimaryInstitution

Reconciliation of operating (loss) to net cash (used by) operating activities:

Operating (loss) (17,297,958) $ Adjustments to reconcile operating (loss) to net cash (used by) operating activities:

Depreciation 3,245,667 Provision for doubtful accounts 442,151 Changes in assets and liabilities:

(Increase) in accounts receivable (521,103) (Increase) in due from other governments (18,259) Decrease in inventories 79,584 (Increase) in prepaid expenses (112,287) Increase in accounts payable 165,887 Increase in salaries and benefits payable 21,636 (Decrease) in net pension liability (592,265) Decrease in pension-related deferred outflows of resources 16,745 (Increase) in OPEB-related deferred outflows of resources (153,873) Increase in pension-related deferred inflows of resources 605,758 Increase in OPEB-related deferred inflows of resources 40,803 (Decrease) in early retirement and net OPEB liability (410,427) (Decrease) in compensated absences (64,421) (Decrease) in advances from grantors (401,399)

Total adjustments 2,344,197

Net cash (used by) operating activities (14,953,761) $

Summary of Cash and Cash Equivalents as of June 30, 2018:

Cash and cash equivalents 11,033,015 $ Cash reserve 264,342

11,297,357 $



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IOWA VALLEY COMMUNITY COLLEGE DISTRICT Exhibit D

STATEMENT OF NET ASSETS Component UnitsDecember 31, 2017

Marshalltown Community

College Foundation

Ellsworth Community

College Foundation Total

ASSETSCurrent Assets:

Cash and short-term investments 1,042,510 $ 637,016 $ 1,679,526 $ 1,042,510 637,016 1,679,526

Noncurrent Assets:Investments 4,059,597 5,714,416 9,774,013 Capital assets - 430,500 430,500

4,059,597 6,144,916 10,204,513

Total assets 5,102,107 6,781,932 11,884,039

LIABILITIES AND NET ASSETSLiabilities 191,747 250,000 441,747

Net assets:Restricted for scholarships and fellowships 4,938,860 6,065,744 11,004,604 Unrestricted (28,500) 466,188 437,688

Total net assets 4,910,360 6,531,932 11,442,292

Total liabilities and net assets 5,102,107 $ 6,781,932 $ 11,884,039 $


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IOWA VALLEY COMMUNITY COLLEGE DISTRICT Exhibit E

STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS Component UnitsYear Ended December 31, 2017

Marshalltown Community

College District Foundation

Ellsworth Community

College Foundation Total

Revenues:Operating revenues:

Contributions 355,399 $ 259,382 $ 614,781 $ Special events and grants - 79,538 79,538

Total operating revenues 355,399 338,920 694,319

Expenses:Operating expenses:

Scholarships and grants 412,990 264,315 677,305 Management and general 51,646 176,389 228,035 Fundraising 78,480 17,223 95,703

Total operating expenses 543,116 457,927 1,001,043

Operating income (loss) (187,717) (119,007) (306,724)

Non-operating revenue:Investment income 283,507 803,471 1,086,978 Other 198 1,422 1,620

Total non-operating revenue 283,705 804,893 1,088,598

Increase in net assets 95,988 685,886 781,874

Net assets:Beginning 4,814,372 5,846,046 10,660,418

Ending 4,910,360 $ 6,531,932 $ 11,442,292 $


IOWA VALLEY COMMUNITY COLLEGE DISTRICT NOTES TO FINANCIAL STATEMENTS

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Note 1. Summary of Significant Accounting Policies

Iowa Valley Community College District is a publicly supported school established and operated by Merged Area VI under the provisions of Chapter 260C of the Code of Iowa. The District offers programs of adult and continuing education, lifelong learning, community education, and up to two years of liberal arts, pre-professional or occupational instruction partially fulfilling the requirements for a baccalaureate degree but confers no more than an associate degree. It also offers up to two years of career and technical education, as well as training or retraining to persons who are preparing to enter the labor market. The District maintains campuses in Marshalltown, Iowa Falls and Grinnell, Iowa, and has its administrative offices in Marshalltown. The District is governed by a Board of Directors whose members are elected from each director district within Merged Area VI.

The District’s financial statements are prepared in conformity with U.S. generally accepted accounting principles as prescribed by the Governmental Accounting Standards Board.

A. Reporting Entity

For financial reporting purposes, the District has included all funds, organizations, agencies, boards, commissions and authorities. The District has also considered all potential component units for which it is financially accountable and other organizations for which the nature and significance of their relationship with the District are such that exclusion would cause the District’s financial statements to be misleading or incomplete. The Governmental Accounting Standards Board has set forth criteria to be considered in determining financial accountability. These criteria include appointing a voting majority of an organization’s governing body and (1) the ability of the District to impose its will on that organization or (2) the potential for the organization to provide specific benefits to or impose specific financial burdens on the District.

These financial statements present the District (the primary government) and its component units. The component units discussed below are included in the District’s reporting entity because of the significance of their operational or financial relationships with the District. The component units year end is December 31, 2017. Certain disclosures about the component units are not included because the component units have been audited separately and a report has been issued under separate cover. The audited financial statements are available at the District.

Discrete Component Units

Marshalltown Community College District Foundation is a legally separate, not-for-profit foundation. The Foundation was established for the purpose of providing scholarships to students and other support for the benefit of Marshalltown Community College, a part of Iowa Valley Community College District. The Foundation is governed by a separate Board of Directors. Although the District does not control the timing or amount of receipts from the Foundation, the majority of the resources held are used for the benefit of Marshalltown Community College.

Ellsworth College Foundation is a legally separate, not-for-profit foundation. The Foundation was established for the purpose of providing scholarships to students and other support for the benefit of Ellsworth Community College, a part of Iowa Valley Community College District. The Foundation is governed by a separate Board of Directors. Although the District does not control the timing or amount of receipts from the Foundation, the majority of the resources held are used for the benefit of Ellsworth Community College.

NOTES TO FINANCIAL STATEMENTS

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Note 1. Summary of Significant Accounting Policies (Continued) A. Reporting Entity (continued)

Discrete Component Units (continued)

The Foundations are non-profit organizations, which report under accounting standards established by the Financial Accounting Standards Board (FASB). The Foundations’ financial statements were prepared in accordance with the provisions of ASC Topic 958 – Not-for-Profit Entities. As such, certain revenue recognition criteria and presentation features are different from GASB revenue recognition criteria and presentation features. No modifications have been made to the Foundations’ financial information in the District’s financial reporting for these differences. The Foundations report net assets, which is equivalent to net position reported by the District. Copies of the Foundations’ financial statements may be obtained by contacting the Foundations.

B. Basis of Presentation

GASB Statement No. 35, establishes standards for external financial reporting for public colleges and universities and requires resources to be classified for accounting and reporting purposes into the following net position categories:

Net Investment in Capital Assets: Capital assets, net of accumulated depreciation and outstanding debt obligations attributable to the acquisition, construction or improvement of those assets.

Restricted Net Position:

Nonexpendable – Net position subject to externally-imposed stipulations that they be maintained permanently by the District, including the District’s permanent endowment funds.

Expendable – Net position whose use by the District is subject to externally-imposed stipulations that can be fulfilled by actions of the District, pursuant to those stipulations or that expire by the passage of time.

Unrestricted Net Position: Net position not subject to externally-imposed stipulations. Resources may be designated for specific purposes by action of management or by the Board of Directors or may otherwise be limited by contractual agreements with outside parties. Substantially all unrestricted net position is designated for academic and general programs of the District.

GASB Statement No. 35 also requires the Statements of Net Position, Revenues, Expenses and Changes in Net Position, and Cash Flows be reported on a consolidated basis. These basic financial statements report information on all of the activities of the District. For the most part, the effect of interfund activity has been removed from these statements.


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Note 1. Summary of Significant Accounting Policies (Continued)

C. Measurement Focus and Basis of Accounting

For financial reporting purposes, the District is considered a special-purpose government engaged only in business type activities as defined in GASB Statement No. 34. Accordingly, the basic financial statements of the District have been prepared using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property tax is recognized as revenue in the year for which it is levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.

D. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources and Net Position

Cash, Cash Equivalents and Pooled Investments: Investments are stated at their fair value, except for non-negotiable certificates of deposit which are stated at amortized cost.

For purposes of the Statement of Cash Flows, all short-term cash investments that are highly liquid are considered to be cash equivalents. Cash equivalents are readily convertible to known amounts of cash and, at the date of purchase, have a maturity date no longer than three months.

Due from Other Governments: This represents state aid, grants and reimbursements due from the State of Iowa and grants and reimbursements due from the Federal government.

Inventories: Inventories are valued at lower of cost (first-in, first-out method) or market. The cost is recorded as an expense at the time individual inventory items are consumed.

Property Tax Receivable: Property tax receivable is recognized on the levy or lien date, which is the date the tax asking is certified by the Board of Directors to the appropriate County Auditors. Delinquent property tax receivable represents unpaid taxes from the current and prior years. The succeeding year property tax receivable represents taxes certified by the Board of Directors to be collected in the next fiscal year for the purposes set out in the budget for the next fiscal year. By statute, the Board of Directors is required to certify its budget to the County Auditor by June 1 of each year for the subsequent fiscal year. However, by statute, the tax asking and budget certification for the following fiscal year becomes effective on the first day of that year. Although the succeeding year property tax receivable has been recorded, the related revenue is reported as deferred inflows of resources and will not be recognized as revenue until the year for which it is levied.

Receivable for Iowa Industrial New Jobs Training Program (NJTP): This amount is reflected in accounts receivable and represents the amount to be remitted to the District for training projects entered into between the District and employers under the provisions of Chapter 260E of the Code of Iowa. The receivable amount is based on expenditures incurred through June 30, 2018 on NJTP projects, including interest incurred on NJTP certificates, less revenues received to date.

Capital Assets: Capital assets, which include land, buildings, improvements other than buildings, equipment and vehicles, are recorded at historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value. Acquisition value is the price that would have been paid to acquire a capital asset with equivalent service potential.

The costs of normal maintenance and repair that do not add to the value of the assets or materially extend asset lives are not capitalized.


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D. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources and Net Position (continued)

Capital Assets (continued): Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business type activities is included as part of the capitalized value of the assets constructed. The total interest expense incurred by the District was $481,083 and $2,938 was capitalized in connection with the District’s construction projects.

Capital assets are defined by the District as assets with initial, individual costs in excess of $5,000 and estimated useful lives in excess of two years. Depreciation is computed using the straight-line method over the following estimated useful lives:

Asset Class

EstimatedUseful Lives

(in Years) Buildings 40Improvements other than buildings 20Equipment 5 - 10Vehicles 5

The District does not capitalize or depreciate library books. The value of each book falls below the capital asset threshold and the balance was deemed immaterial to the financial statements. Deferred Outflows of Resources: Deferred outflows of resources represent a consumption of net position applicable to a future years(s) which will not be recognized as an outflow of resources expense until then. Deferred outflows of resources consist of unrecognized items not yet charged to pension and OPEB expense and contributions from the District after the measurement date but before the end of the District’s reporting period. Salaries and Benefits Payable: Payroll and related expenses for teachers with annual contracts corresponding to the current school year, which are payable in July and August, have been accrued as liabilities.

Advances from Grantors: Grant proceeds which have been received by the District but will be spent in a succeeding fiscal year.

Compensated Absences: District employees accumulate a limited amount of earned but unused vacation and sick leave hours for subsequent use or for payment upon termination, death or retirement. Amounts representing the cost of compensated absences are recorded as liabilities. These liabilities have been computed based on rates of pay in effect at June 30, 2018.

Accrued Interest Payable: Interest on long-term indebtedness is recorded as a liability when the interest is incurred.

Deposits Held in Custody for Others: These deposits consist primarily of funds for student organizations and 260F agreements.


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Pensions: For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions and pension expense, information about the fiduciary net position of the Iowa Public Employees’ Retirement System (IPERS) and additions to/deductions from IPERS’ fiduciary net position have been determined on the same basis as they are reported by IPERS. For this purpose, benefit payments, including refunds of employee contributions, are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.

Total OPEB Liability: For purposes of measuring the total OPEB liability, deferred outflows of resources related to OPEB and OPEB expense, information has been determined based on the District’s actuary report. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms.

Deferred Inflows of Resources: Deferred inflows of resources represent an acquisition of net position applicable to a future year(s) which will not be recognized as an inflow of resources (revenue) until that time. Deferred inflows of resources in the Statement of Net Position consists of succeeding year property tax receivable that will not be recognized as revenue until the year for which it is levied, unrecognized items not yet charged to pension and OPEB expense and the unamortized portion of the net difference between projected and actual earnings on pension plan assets.

Auxiliary Enterprise Revenues and Expenses: Auxiliary enterprise revenues and expenses primarily represent revenues generated and expenses associated with the bookstore, cafeteria, athletics and housing. Revenues are recognized when goods or services are provided.

Summer Session: The District operates summer sessions during May, June and July including Internet sessions. Revenues and expenses for the regular and Internet summer sessions are recorded in the appropriate fiscal year. Tuition and fees are allocated based on the load study distributions supplied by the District Registrar.

Tuition and Fees: Tuition and fees revenues are reported net of scholarship allowances, while stipends and other payments made directly to students are presented as scholarship and fellowship expenses.

Income Taxes: The District is exempt from income tax as a local government unit. The Marshalltown Community College District Foundation and the Ellsworth College Foundation have qualified for exemption from income tax under Section 501c (3) of the Internal Revenue Code.

Operating and Non-operating Activities: Operating activities, as reported in the Statement of Revenues, Expenses and Changes in Net Position, are transactions that result from exchange transactions, such as payments received for providing services and payments made for services or goods received. Non-operating activities include state appropriations, Pell grants, property tax and interest income.

Transfers: Transfers from District funds were primarily composed of amounts from student fees used in support of athletics.


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Use of Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

E. Scholarship Allowances and Student Aid Financial aid to students is reported in the financial statements under the alternative method, as prescribed by the National Association of College and University Business Officials (NACUBO). Certain aid (loans, funds provided to students as awarded by third parties and Federal Direct Lending) is accounted for as third-party payments (credited to the student’s account as if the student made the payment). All other aid is reflected in the financial statements as operating expenses or scholarship allowances, which reduce revenues. The amount reported as operating expenses represents the portion of aid that was provided to the student in the form of cash. Scholarship allowances represent the portion of aid provided to the student in the form of reduced tuition. Under the alternative method, these amounts are computed on a total college basis by allocating the cash payments to students, excluding payments for services, on the ratio of all aid to the aid not considered to be third party aid.

F. Subsequent Event

Subsequent events have been evaluated through December 7, 2018 which is the date the financial statements were available to be issued. Events occurring after that date have not been evaluated to determine whether a change in the financial statements would be required.

Note 2. Cash and Cash Equivalents

The District’s deposits in banks at June 30, 2018 were entirely covered by federal depository insurance or by the State Sinking Fund in accordance with Chapter 12C of the Code of Iowa. This chapter provides for additional assessments against the depositories to insure there will be no loss of public funds. The District is authorized by statute to invest public funds in obligations of the United States government, its agencies and instrumentalities; certificates of deposit or other evidences of deposit at federally insured depository institutions approved by the Board of Directors; prime eligible bankers acceptances; certain high rated commercial paper; perfected repurchase agreements; certain registered open-end management investment companies; certain joint investment trusts; and warrants or improvement certificates of a drainage district. The District uses the fair value hierarchy established by generally accepted accounting principles based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets. Level 2 inputs are significant other observable inputs. Level 3 inputs are significant unobservable inputs.


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Note 2. Cash and Cash Equivalents (Continued) The June 30, 2018 fair value measurement of the District’s investment in certificates of deposit of $4,775,684 was determined using Level 2 inputs. Interest Rate Risk: The District’s investment policy limits the investment of operating funds (funds expected to be expended in the current budget year or within 15 months of receipt) to instruments that mature within 397 days. Funds not identified as operating funds may be invested in investments with maturities longer than 397 days, but the maturities shall be consistent with the needs and use of the District. Credit Risk: Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Concentration of Credit Risk: The District’s general investment policy is to apply the prudent-person rule. Investments are made as a prudent person would be expected to act, with discretion and intelligence, to seek reasonable income, preserve capital and, in general, avoid speculative investments. The District’s investment policy seeks to provide safety of the principal, maintain the necessary liquidity to match expected liabilities and obtain a reasonable rate of return. The policy does not allow the District to invest in reverse purchase agreements, futures or options. The District did not have any investments in any one issuer that represents 5% or more of total District investments. Money market funds and mutual funds are excluded from this consideration given that the District does not “hold” the underlying investments. Custodial Credit Risk: Custodial credit risk is the risk that in the event of a bank failure, the government’s deposits may not be returned to it. It is the District’s policy to require that time deposits in excess of FDIC insurable limits be secured by collateral or private insurance to protect public deposits in a single financial institution if it were to default. Component Units: The District categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The component units have the following recurring fair value measurements at June 30, 2018: Investments Fair Value Level 1 Level 2Cash and cash equivalents 91,803 $ 91,803 $ -$ Certificates of deposit 70,201 - 70,201 Exchange traded and close-end funds 803,890 803,890 - Mutual funds 3,233,740 3,233,740 - Equity securities 2,996,178 2,996,178 - Fixed income investments 2,578,201 2,578,201 -

9,774,013 $ 9,703,812 $ 70,201 $


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Note 3. Inventories The District’s inventories at June 30, 2018 are as follows:

Type AmountMerchandise held for resale 326,289 $

Note 4. Capital Assets A summary of the changes in capital assets for the year ended June 30, 2018 is as follows:

BalanceBeginningof Year Additions Deletions

BalanceEnd ofYear

Capital assets not being depreciated:Land 3,463,786 $ -$ -$ 3,463,786 $ Construction in progress - 520,830 - 520,830

3,463,786 520,830 - 3,984,616

Capital assets being depreciated: Buildings 81,517,649 177,030 - 81,694,679 Improvements other than buildings 1,570,625 7,000 - 1,577,625 Equipment and vehicles 8,129,296 160,979 369,780 7,920,495

91,217,570 345,009 369,780 91,192,799

Less accumulated depreciation for: Buildings 31,004,415 2,372,848 - 33,377,263 Improvements other than buildings 599,940 55,838 - 655,778 Equipment and vehicles 5,571,828 816,981 366,364 6,022,445 Total accumulated depreciation 37,176,183 3,245,667 366,364 40,055,486

54,041,387 (2,900,658) 3,416 51,137,313

Capital assets, net 57,505,173 $ (2,379,828) $ 3,416 $ 55,121,929 $

Total capital assets not being depreciated

Total capital assets being depreciated

Total capital assets being depreciated, net


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Note 5. Changes in Noncurrent Liabilities

A summary of changes in noncurrent liabilities for the year ended June 30, 2018 is as follows: Note 4

CompensatedAbsences

EarlyRetirement

Payable

TotalOPEB

Payable

NetPensionLiability

CertificatesPayable

NotesPayable,Revenue

and GeneralObligation

Bonds TotalBalance, beginning

of year, as restated 406,900 $ 1,450,347 $ 1,182,487 $ 6,324,238 $ 4,730,000 $ 9,366,250 $ 23,460,222 $ Additions 342,479 46,437 - - - - 388,916 Reductions 406,900 343,980 112,885 592,265 820,000 2,232,500 4,508,530

Balance, end of year 342,479 $ 1,152,804 $ 1,069,602 $ 5,731,973 $ 3,910,000 $ 7,133,750 $ 19,340,608 $

Due within one year 342,479 $ 603,063 $ -$ -$ 910,000 $ 1,213,750 $ 3,069,292 $

Notes Payable, Revenue and General Obligation Bonds: The District has issued notes payable, revenue and general obligation bonds for the purchase and construction of District properties as allowed by Section 260C.19 of the Code of Iowa. Details of scheduled maturities for the District’s June 30, 2018 notes payable, revenue and general obligation bonds are as follows:

Principal Interest Total2019 1,213,750$ 272,938$ 1,486,688$ 2020 520,000 229,688 749,688 2021 530,000 212,136 742,136 2022 555,000 193,602 748,602 2023 575,000 173,702 748,702 2024-2028 2,850,000 534,492 3,384,492 2029-2030 890,000 62,325 952,325

Total 7,133,750$ 1,678,883$ 8,812,633$

Year Ending June 30

Notes payable, revenue and general obligation bonds consisted of the following principal balances as of June 30, 2018:

General obligation bonds dated April 1, 2009, with interest rates between 2.45% and3.85%. Interest is payable semiannually, while principal payments in varying amountsare due annually, with a maturity date of June 1, 2019. All real estate, personalproperty, revenues, resources and credit of the District are collateral for the debt. 700,000 $

Dormitory revenue bonds dated December 1, 2010, with interest rates between 3.00%and 4.65%. Interest is payable semiannually, while principal payments in varyingamounts are due annually, with a maturity date of May 1, 2030. All real estate, personalproperty, revenues, resources and credit of the District are collateral for the debt. 4,360,000



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Note 5. Changes in Noncurrent Liabilities (Continued) Notes Payable, Revenue and General Obligation Bonds (Continued):

Student housing revenue refund bonds dated January 2015, with an interest rate of3.00%. Interest is payable semiannually, while principal payments in varying amountsare due annually, with a maturity date of May 1, 2027. The real estate, student housingfacilities and related personal property are collateral for the debt. 2,055,000 $

U.S. Department of Agriculture, Rural Economic Development loan dated December2008, with interest rate of 0%. Principal payments in varying amounts are due annually,with a maturity date of May 1, 2019. The revenue stream, real estate, dormitoryfacilities and related personal property are collateral for the debt. 18,750

7,133,750 $

Certificates Payable: Pursuant to agreements dated from May 2008 to May 2017, the District has outstanding certificates totaling $3,910,000 as of June 30, 2018, with net interest rates ranging from 1.70% to 5.00% per annum. The debt was issued to fund the development and training costs incurred relative to implementing Chapter 260E of the Code of Iowa, Iowa Industrial New Jobs Training Program (NJTP). NJTP’s purpose is to provide tax-aided training for employees of industries that are new or are expanding their operations within the State of Iowa. Interest is payable semiannually, while principal payments are due annually. Amounts due will be paid from anticipated job credits from withholding taxes, incremental property taxes, budgeted reserves and in the case of default, from standby property tax. The certificates will mature as follows: Year Ending June 30 Principal Interest Total2019 910,000$ 99,695$ 1,009,695$ 2020 575,000 85,887 660,887 2021 575,000 71,765 646,765 2022 575,000 56,467 631,467 2023 570,000 39,675 609,675 2024-2027 705,000 28,850 733,850

3,910,000$ 382,339$ 4,292,339$

Since inception, the District has administered 122 projects, with 11 currently receiving project funding. Of the remaining projects, 111 have been completed and closed.


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Note 6. Operating Leases The District leases certain property within the area to house different divisions of the District and equipment under operating leases that expire from May 2020 through January 2025 and require various maximum annual rentals. Most of the operating leases provide the District with the option to renew the lease at a fair rental value at the end of the initial lease term. Generally, management expects that the leases will be renewed or replaced by other leases in the normal course of business. Minimum payments for operating leases having initial or remaining noncancelable terms in excess of one year are as follows:

Amount2019 275,851$ 2020 266,617 2021 40,163 2022 40,163 2023 5,850 Thereafter 8,775

637,419$

Year Ending June 30

Total rent expense for all operating leases was $247,060 for the year ended June 30, 2018. Note 7. Iowa Public Employees Retirement System (IPERS) Plan Description: IPERS membership is mandatory for employees of the District, except for those covered by another retirement system. Employees of the District are provided with pensions through a cost-sharing multiple employer defined benefit pension plan administered by IPERS. IPERS issues a stand-alone financial report which is available to the public by mail at P.O. Box 9117, Des Moines, Iowa 50306-9117 or at www.ipers.org. IPERS benefits are established under Iowa Code chapter 97B and the administrative rules thereunder. Chapter 97B and the administrative rules are the official plan documents. The following brief description is provided for general informational purposes only. Refer to the plan documents for more information. Pension Benefits: A regular member may retire at normal retirement age and receive monthly benefits without an early-retirement reduction. Normal retirement age is age 65, any time after reaching age 62 with 20 or more years of covered employment, or when the member’s years of service plus the member’s age at the last birthday equals or exceeds 88, whichever comes first. These qualifications must be met on the member’s first month of entitlement to benefits. Members cannot begin receiving retirement benefits before age 55. The formula used to calculate a Regular member’s monthly IPERS benefit includes:

• A multiplier based on years of service. • The member’s highest five-year average salary, except members with service before June 30, 2012 will use

the highest three-year average salary as of that date if it is greater than the highest five-year average salary.


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Note 7. Iowa Public Employees Retirement System (IPERS) (Continued) If a member retires before normal retirement age, the member’s monthly retirement benefit will be permanently reduced by an early-retirement reduction. The early-retirement reduction is calculated differently for service earned before and after July 1, 2012. For service earned before July 1, 2012, the reduction is 0.25% for each month the member receives benefits before the member’s earliest normal retirement age. For service earned on or after July 1, 2012, the reduction is 0.50% for each month that the member receives benefits before age 65.

Generally, once a member selects a benefit option, a monthly benefit is calculated and remains the same for the rest of the member’s lifetime. However, to combat the effects of inflation, retirees who began receiving benefits prior to July 1990 receive a guaranteed dividend with their regular November benefit payments. Disability and Death Benefits: A vested member who is awarded federal Social Security disability or Railroad Retirement disability benefits is eligible to claim IPERS benefits regardless of age. Disability benefits are not reduced for early retirement. If a member dies before retirement, the member’s beneficiary will receive a lifetime annuity or a lump-sum payment equal to the present actuarial value of the member’s accrued benefit or calculated with a set formula, whichever is greater. When a member dies after retirement, death benefits depend on the benefit option the member selected at retirement. Contributions: Contribution rates are established by IPERS following the annual actuarial valuation which applies IPERS’ Contribution Rate Funding Policy and Actuarial Amortization Method. State statute limits the amount rates can increase or decrease each year to 1 percentage point. IPERS Contribution Rate Funding Policy requires the actuarial contribution rate be determined using the “entry age normal” actuarial cost method and the actuarial assumptions and methods approved by the IPERS Investment Board. The actuarial contribution rate covers normal cost plus the unfunded actuarial liability payment based on a 30-year amortization period. The payment to amortize the unfunded actuarial liability is determined as level percentage of payroll, based on the Actuarial Amortization Method adopted by the Investment Board. In fiscal year 2018, pursuant to the required rate, Regular members contributed 5.95% of covered payroll and the District contributed 8.93% of covered payroll, for a total rate of 14.88%. The District’s contributions to IPERS for the year ended June 30, 2018 were $561,392. Net Pension Liability, Pension Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions: At June 30, 2018, the District reported a liability of $5,731,973 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2017 and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The District’s proportion of the net pension liability was based on the District’s share of contributions to the IPERS relative to the contributions of all IPERS participating employers. At June 30, 2017, the District’s proportion was 0.086049%, which was a decrease of 0.014442% from its proportion measured as of June 30, 2016.


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Note 7. Iowa Public Employees Retirement System (IPERS) (Continued) Net Pension Liability, Pension Expense, Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions (continued): For the year ended June 30, 2018, the District recognized pension expense of $591,891. At June 30, 2018, the District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred Outflows of Resources

Deferred Inflows of Resources

Differences between expected and actual experience 52,625$ 49,663$

Changes of assumptions 995,953 -

Net difference between projected and actual earnings on IPERS' investments - 59,868

Changes in proportion and differences between District contributions and the District's proportionate share of contributions - 742,796

District contributions subsequent to the measurement date 561,392 -

Total 1,609,970$ 852,327$

$561,392 reported as deferred outflows of resources related to pensions resulting from District contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ending June 30, 2019. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: Year Ended June 30,

2019 (57,625)$ 2020 262,731 2021 90,198 2022 (123,362) 2023 24,309

196,251$

There were no non-employer contributing entities at IPERS.


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Note 7. Iowa Public Employees Retirement System (IPERS) (Continued)

Actuarial Assumptions: The total pension liability in the June 30, 2017 actuarial valuation was determined using the following actuarial assumptions applied to all periods included in the measurement. Rate of inflation (effective June 30, 2017) 2.60% per annum.

Rates of salary increase (effective June 30, 2017)

Long-term investment rate of return (effective June 30, 2017)

Wage growth (effective June 30, 2017)

7.00% compounded annually, net of investment expense, including inflation

3.25 to 16.25% average, including inflation. Rates vary by membership group.

3.25% per annum, based on 2.60% inflation and 0.65% real wage inflation.

The actuarial assumptions used in the June 30, 2017 valuation were based on the results of an actuarial experience study dated March 24, 2017. Mortality rates were based on the RP-2000 Mortality Table for Males or Females, as appropriate, with adjustments for mortality improvements based on Scale AA. The long-term expected rate of return on IPERS’ investments was determined using a building-block method in which best-estimate ranges of expected future real rates (expected returns, net of investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:

Asset ClassDomestic equity 24.0 % 6.25 %International equity 16.0 6.71Core plus fixed income 27.0 2.25Public credit 3.5 3.46Public real assets 7.0 3.27Cash 1.0 ( 0.31 )Private equity 11.0 11.15Private real assets 7.5 4.18Private credit 3.0 4.25

Total 100.0 %

Asset AllocationLong-term ExpectedReal Rate of Return


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Note 7. Iowa Public Employees Retirement System (IPERS) (Continued) Discount Rate: The discount rate used to measure the total pension liability was 7.0%. The projection of cash flows used to determine the discount rate assumed that employee contributions will be made at the contractually required rate and contributions from the District will be made at contractually required rates, actuarially determined. Based on those assumptions, IPERS’ fiduciary net position was projected to be available to make all projected future benefit payments to current active and inactive employees. Therefore, the long-term expected rate of return on IPERS’ investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of the District’s Proportionate Share of the Net Pension Liability to Changes in the Discount Rate: The following presents the District’s proportionate share of the net pension liability calculated using the discount rate of 7.00%, as well as what the District’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1% lower (6.00%) or 1% higher (8.00%) than the current rate.

1%Decrease(6.0%)

DiscountRate

(7.0%)

1%Increase(8.0%)

District's proportionate share of the net pension liability 9,443,992$ 5,731,973$ 2,613,164$

IPERS’ Fiduciary Net Position: Detailed information about IPERS’ fiduciary net position is available in the separately issued IPERS financial report which is available on IPERS’ website at www.ipers.org Payables to IPERS: At June 30, 2018, the District reported payables to IPERS of $0 for legally required employer contributions and $0 for legally required employee contributions which had been withheld from employee wages which had not yet been remitted to IPERS. Note 8. Teachers Insurance and Annuity Association – (TIAA) The District contributes to the TIAA retirement program, which is a defined contribution pension plan. TIAA administers the retirement plan for the District. The defined contribution retirement plan provides individual annuities for each plan participant. As required by the Code of Iowa, all eligible District employees must participate in a retirement plan from the date they are employed. Benefit terms, including contribution requirements, for TIAA are established and specified by the plan with TIAA, and in accordance with the Code of Iowa. For each employee in the pension plan, the District is required to contribute 8.93% of annual salary, including overtime pay, to an individual employee account. Each employee is required to contribute 5.95%. Contributions made by both the District and employees vest immediately. For the year ended June 30, 2018, employee contributions totaled $390,347 and the District recognized pension expense of $585,867.

http://www.ipers.org/


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Note 9. Early Retirement The District approved an Early Retirement Incentive Plan (ERIP) effective November 8, 2017. The plan expired on June 30, 2018. To be eligible for ERIP, an employee must be employed at least half-time and be 55 years of age with 10 or more years of continuous service with the District. Retirement is to be effective June 30, 2018. Participation must be approved by the Chancellor. An employee approved for participation in the program will receive the following incentives: 1. Early Retirement Incentive cash severance amount of the employee’s annual salary during the year of the

request, based upon the following schedule:

Years of Service Percentage of

Salary 20 or more 100%15 - 19 90 10-14 80

2. Up to $500 of the employee’s single deductible health insurance premium shall be paid on a monthly basis

until the retiree becomes eligible for Medicare.

The employees receive the cash benefits in 36 equal installments commencing on July 15, 2018. The lump-sum payment liability is $1,106,367 and is recorded as early retirement payable. The current year cost to the District was $267,314 including 27 participants in the health insurance plan. The liability for the participation in the health plan is $46,437 and is recorded as early retirement payable. This portion of the liability will be paid over the next eight years. The liability was calculated using the District’s share of health premiums at the time of retirement to estimate costs. Note 10. Insurance Management Program for Area Community Colleges (IMPACC) The District is a member of the Insurance Management Program for Area Community Colleges (IMPACC), as allowed by Chapter 504A of the Code of Iowa. IMPACC (Program) is a group self-insurance program whose five members are Iowa Community Colleges. The Program was incorporated in May 1988 for the purpose of managing and funding insurance for its members. The Program provides coverage and protection in the following categories: general liability, employee benefits liability, automobile liability, automobile physical damage, property and inland marine, wrongful acts and educators’ legal liability, workers compensation and employer’s liability, crime and employee fidelity, equipment breakdown (boiler and machinery), foreign liability and cyber liability. There have been no reductions in insurance coverage from prior years.

Each member’s annual contributions to the Program fund current operations and provide capital. Annual operating contributions are those amounts necessary to fund, on a cash basis, the Program’s general and administrative expenses, claims, claims expenses and reinsurance expenses due and payable in the current year.


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Note 10. Insurance Management Program for Area Community Colleges (IMPACC) (Continued) The District’s contributions to the Program are recorded as prepaid expense from its operating funds at the time of payment. The District amortizes the expense over the periods for which the Program is expected to provide coverage.

The Program uses reinsurance to reduce its exposure to large losses. The Program has a self-insured retention of $100,000 per occurrence for wrongful acts, employee benefits liability and educators’ legal liability, $250,000 per occurrence for workers’ compensation and employer’s liability and $200,000 per occurrence for most other claims. First layer excess insurance is $800,000 per occurrence for property, general and automobile liability, $900,000 per occurrence for wrongful acts, employee benefits liability and educators’ legal liability and $250,000 per occurrence for workers’ compensation. The Program’s annual aggregate retention (loss fund) is $925,000 with stop gap loss protection is provided above the loss fund. There is additional excess insurance for workers’ compensation to statutory limits and for liability claims to $10,000,000 per occurrence. Property is insured with excess coverage over the self-insured retention and underlying layer of up to $250,000,000 per occurrence. Flood and earthquake exposures are covered in the property program each having $16,000,000 limits. Also covered is employee fidelity up to $2,000,000 having a deductible of $10,000 per member, boiler and machinery coverage up to $100,000,000 with a deductible of $10,000 per member loss, foreign travel coverage with limits of $1,000,000, as well as cyber liability including identity theft protection up to $1,000,000 annual aggregate per member with a deductible of $50,000 per member loss.

The Program’s intergovernmental contract with its members provides that in the event any claim or series of claims exceeds the amount of aggregate excess insurance, then payment of such claims shall be the obligation of the respective individual member. The District does not report a liability for losses in excess of reinsurance unless it is deemed probable such losses have occurred and the amount of such loss can be reasonably estimated. Accordingly, at June 30, 2018, no liability has been recorded in the District’s financial statements. As of June 30, 2018, settled claims have not exceeded the Program’s coverage in any of the past three fiscal years. Members agree to continue membership in the Program for a period of not less than three full years. After such period, a member who has given sufficient notice, in compliance with the By-laws, may withdraw from the Program. Upon withdrawal, payments for all claims and claims expenses for the years of membership continue until all claims for those years are settled.

The District also carries commercial insurance purchased from other insurers for coverage associated with catastrophic, accidental death and dismemberment, and underground storage tanks. The District assumes liability for any deductibles and claims in excess of coverage limits. Settled claims resulting from these risks have not exceeded commercial insurance coverage in any of the past three fiscal years.


38

Note 11. Other Postemployment Benefits (OPEB) Plan Description: The District administers a single-employer benefit plan which provides medical and prescription drug benefits for employees, retirees and their spouses. Group insurance benefits are established under Iowa Code Chapter 509A.13. No assets are accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No. 75.

OPEB Benefits: Individuals who are employed by the District are eligible to participate in the group health plan are eligible to continue healthcare benefits upon retirement. Retirees under age 65 pay the same premiums for medical and prescription drug benefits as active employees, which results in an implicit rate subsidy and an OPEB liability. Retired participants must be age 55 or older at retirement. At June 30, 2018, the following employees were covered by the benefit terms: Inactive employees or beneficiaries currently receiving benefit payments 23 Active employees 213

Total 236

Total OPEB Liability: The District’s total OPEB liability of $1,069,602 was measured as of June 30, 2018, and was determined by an actuarial valuation as of that date. Actuarial Assumptions: The total OPEB liability in the June 30, 2018 actuarial valuation was determined using the following actuarial assumptions and the entry age normal actuarial cost method, applied to all periods included in the measurement. Rate of inflation

(effective June 30, 2018) 3.00% per annum.

Rates of salary increase(effective June 30, 2018) 0.00% per annum.

Discount rate(effective June 30, 2018) 3.72% compounded annually, including inflation.

Healthcare cost trend rate(effective June 30, 2018) 6.00% per annum.

Discount Rate: The discount rate used to measure the total OPEB liability was 3.72% which reflects the index rate for 20-year municipal bonds with an average rating of AA per The Vanguard Group, Municipal Bond Index as of the measurement date.

Mortality rates are from the RP 2014 Annuity Mortality Table (2/3 female, 1/3 male). Annual retirement probabilities are based on varying rates by age and turnover probabilities mirror those used by IPERS. The actuarial assumptions used in the June 30, 2018 valuation were based on the results of an actuarial experience study with dates corresponding to those listed above.


39

Note 11. Other Postemployment Benefits (OPEB) Changes in the Total OPEB Liability:

Total OPEBLiability

Total OPEB liability beginning of year, as restated 1,182,487$ Changes for the year:

Service cost 65,167 Interest 43,423 Changes in assumptions (45,477) Benefit payments (175,998)

Net changes (112,885)

Total OPEB liability end of year 1,069,602$

Sensitivity of the District’s Total OPEB Liability to Changes in the Discount Rate: The following presents the total OPEB liability of the District, as well as what the District’s total OPEB liability would be if it were calculated using a discount rate that is 1% lower (2.72%) or 1% higher (4.72%) than the current discount rate.

1% Decrease(2.72%)

DiscountRate

(3.72%)

1% Increase(4.72%)

Total OPEB liability 1,139,887$ 1,069,602$ 1,011,479$

Sensitivity of the District’s Total OPEB Liability to Changes in the Healthcare Cost Trend Rates: The following presents the total OPEB liability of the District, as well as what the District’s total OPEB liability would be if it were calculated using healthcare cost trend rates that are 1% lower (5.00%) or 1% higher (7.00%) than the current healthcare cost trend rates.

1% Decrease(5.00%)

DiscountRate

(6.00%)

1% Increase(7.00%)

Total OPEB liability 999,236$ 1,069,602$ 1,160,012$

OPEB Expense and Deferred Outflows and Deferred Inflows of Resources Related to OPEB: For the year ended June 30, 2018, the District recognized OPEB expense of $103,916. At June 30, 2018, the District reported deferred outflows and deferred inflows of resources related to OEPB from the following resources:

Deferred Outflows

of Resources

Deferred Inflows

of ResourcesContributions between measurement date and reporting date 153,873$ -$ Changes in assumptions - 40,803

Total 153,873$ 40,803$


40

Note 11. Other Postemployment Benefits (OPEB) OPEB Expense and Deferred Outflows and Deferred Inflows of Resources Rated to OPEB (continued): The amount reported as deferred outflows and deferred inflows of resources related to OPEB will be recognized as OPEB expense as follows:

Year Ending June 30, Total2019 149,199$ 2020 (4,674) 2021 (4,674) 2022 (4,674) 2023 (4,674) Thereafter (17,433)

113,070$

Note 12. Subsequent Events On July 19, 2018, the Orpheum Theatre and Education and Training Center sustained significant structural damage from a tornado that impacted the City of Marshalltown. The District is currently repairing both buildings with estimated costs of $1.9 million dollars to be paid through District insurance coverage. On July 2, 2018, the District issued Dormitory Revenue Refunding Bonds, Series 2018, in the aggregate amount of $3,992,000 to refund the Dormitory Revenue Refunding Bonds, Series 2010 prior to maturity in order to realize debt service savings due to lower interest rates payable on the Refunding Bonds. The debt will mature May 1, 2029. Note 13. Deficit Fund Balance The District has a deficit balance in the fund as listed below as of June 30, 2018. Management believes that future transfers from unrestricted current funds will eliminate the deficit balance.

Loan Fund (3,500) $


41

Note 14. Tax Abatements

Governmental Accounting Standards Statement No. 77 defines tax abatements as a reduction in tax revenues that results from an agreement between one or more governments and an individual or entity in which (a) one or more governments promise to forgo tax revenues to which they are otherwise entitled and (b) the individual or entity promises to take a specific action after the agreement has been entered into that contributes to economic development or otherwise benefits the governments or the citizens of those governments.

District Tax Abatements

The District provides tax abatements for industrial new jobs training projects with the tax increment financing as provided for in section 403.19 of the Code of Iowa and/or state income tax withholding as provided for in section 260E.5 of the Code of Iowa. For these types of projects, the District enters into agreements with employers which require the District, after employers meet the terms of the agreements, to pay the employers for the costs of on-the-job training not to exceed 50% of the annual gross payroll costs for up to one year of the new jobs. No other commitments were made by the District as part of these agreements.

For the year ended June 30, 2018, the District had no abatements of property tax and $343,829 of state income tax withholding under the projects.

Tax Abatements of Other Entities

Property tax revenues of the District were reduced by the following amounts for the year ended June 30, 2018 under agreements entered into by the following entities:

Entity Tax Abatement ProgramAmount of Tax Abated

City of Ackley Urban renewal and economic development projects 95 $

City of Iowa Falls Urban renewal and economic development projects 8,396

City of State Center Urban renewal and economic development projects 237

City of Brooklyn Urban renewal and economic development projects 318

City of Grinnell Urban renewal and economic development projects 69,186

City of Malcom Urban renewal and economic development projects 464

City of Tama Urban renewal and economic development projects 4,214

City of Marshalltown Urban renewal and economic development projects 3,375

City of Montezuma Urban renewal and economic development projects 1,762

Franklin County Urban renewal and economic development projects 65,536

Hardin County Urban renewal and economic development projects 30,813

Marshall County Urban renewal and economic development projects 1,429


42

Note 15. Accounting Change/Restatement Governmental Accounting Standards Board has issued Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions (OPEB) was implemented during fiscal year 2018. The revised requirements establish new financial reporting requirements for state and local governments which provide their employees with OPEB benefits, including additional note disclosure and required supplementary information. In addition, GASB Statement No. 75 requires a state or local government employer to use the entry age normal actuarial cost method, and requires deferred outflows of resources and deferred inflows of resources which arise from other types of events related to OPEB to be recognized. During the transition year, as permitted, beginning balances for deferred outflows of resources and deferred inflows of resources are not reported. Beginning net position was restated to retroactively report the change in valuation of the beginning total OPEB liability, as follows:

NetPosition

Net position June 30, 2017, as previously reported 52,405,650 $

Net OPEB obligation measured under previous standards 571,698

Total OPEB liability at June 30, 2017 (1,182,487)

Agency fund net position restatement reflected in Deposits Held in Custody for Others 11,676

Net position July 1, 2017, as restated 51,806,537 $

REQUIRED SUPPLEMENTARY INFORMATION

43


Iowa Public Employees' Retirement SystemFor the Last Four Fiscal Years*(In Thousands)


District's proportion of the net pension liability 0.086049 % 0.100491 % 0.104584 % 0.106211 %

District's proportionate share of the net pension liability 5,732$ 6,324$ 5,166$ 4,212$

District's covered payroll 6,420$ 7,207$ 7,144$ 6,976$

District's proportionate share of the net pension liability as a percentage of its covered payroll 89.28 % 87.75 % 72.31 % 60.38 %

IPERS' net position as a percentage of the total pension liability 82.21 % 81.82 % 85.19 % 87.61 %

NOTE: GASB Statement No. 68 requires ten years of information to be presented in this table. However, until a full ten-year trend is compiled, the District will present information for those years for which information is available.

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

2018 2016 2015

* In accordance with GASB Statement No. 68, the amounts presented for each fiscal year were determined as of June 30 of the preceding fiscal year.

2017


Iowa Public Employees' Retirement SystemFor the Last Ten Fiscal Years(In Thousands)


Year 2018 2017 2016 2015

Statutorily required contribution 561$ 573$ 643$ 638$

Contributions in relation to the statutorily required contribution (561) (573) (643) (638)

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

District's covered payroll 6,287$ 6,420$ 7,207$ 7,144$

Contributions as a percentage of covered payroll 8.93% 8.93% 8.93% 8.93%

See accompanying Independent Auditor's Report.

SCHEDULE OF DISTRICT CONTRIBUTIONS

44

Ended June 30,2014 2013 2012 2011 2010 2009

623$ 590$ 548$ 432$ 397$ 394$

(623) (590) (548) (432) (397) (394)

-$ -$ -$ -$ -$ -$

6,976$ 6,805$ 6,791$ 6,216$ 5,970$ 6,205$

8.93% 8.67% 8.07% 6.95% 6.65% 6.35%

IOWA VALLEY COMMUNITY COLLEGE DISTRICT Notes to Required Supplementary Information – Pension Liability Year Ended June 30, 2018

45

Changes of benefit terms:

Legislation enacted in 2010 modified benefit terms for Regular members. The definition of final average salary changed from the highest three to the highest five years of covered wages. The vesting requirement changed from four years of service to seven years. The early retirement reduction increased from 3% per year measured from the member’s first unreduced retirement age to a 6% reduction for each year of retirement before age 65. Changes of assumptions:

The 2017 valuation implemented the following refinements as a result of an experience study dated March 24, 2017: • Decreased the inflation assumption from 3.00% to 2.60%. • Decreased the assumed rate of interest on member accounts from 3.75% to 3.50% per year. • Decreased the discount rate from 7.50% to 7.00%. • Decreased the wage growth assumption from 4.00% to 3.25%. • Decreased the payroll growth assumption from 4.00% to 3.25%.

The 2014 valuation implemented the following refinements as a result of a quadrennial experience study: • Decreased the inflation assumption from 3.25% to 3.00%. • Decreased the assumed rate of interest on member accounts from 4.00% to 3.75% per year. • Adjusted male mortality rates for retirees in the Regular membership group. • Moved from an open 30-year amortization period to a closed 30-year amortization period for the UAL

(unfunded actuarial liability) beginning June 30, 2014. Each year thereafter, changes in the UAL from plan experience will be amortized on a separate closed 20-year period.

The 2010 valuation implemented the following refinements as a result of a quadrennial experience study: • Adjusted retiree mortality assumptions. • Modified retirement rates to reflect fewer retirements. • Lowered disability rates at most ages. • Lowered employment termination rates. • Generally increased the probability of terminating members receiving a deferred retirement benefit. • Modified salary increase assumptions based on various service duration.

46


2018Service cost 65,167 $ Interest cost 43,423 Changes in assumptions (45,477) Benefit payments (175,998)

Net change in total OPEB liability (112,885)

Total OPEB liability beginning of year, as restated 1,182,487

Total OPEB liability end of year 1,069,602 $

Covered-employee payroll 11,827,388 $

Total OPEB liability as a percentage of covered payroll 9.04%

SCHEDULE OF CHANGES IN THE DISTRICT'S TOTAL OPEB LIABILITY, RELATED RATIOS AND NOTES


Notes to Schedule of Changes in the District’s Total OPEB Liability and Related Ratios Changes in benefit terms: There were no significant changes in benefit terms. Changes in assumptions: Changes in assumptions and other inputs reflect the effects of changes in the discount rate each period. The following are the discount rates used in each period. Year ended June 30, 2018 3.72% Year ended June 30, 2017 3.72%

SUPPLEMENTARY INFORMATION

IOWA VALLEY COMMUNITY COLLEGE DISTRICT Notes to Supplementary Information Year Ended June 30, 2018

47

Supplementary information of the District is presented on the basis of funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for by providing a separate set of self-balancing accounts which comprise its assets, liabilities, fund balance, revenue and expenditures. The various fund groups and their designated purposes are as follows:

Current Funds – The Current Funds are utilized to account for those economic resources that are expendable for the purpose of performing the primary and supporting missions of the District and consist of the following:

Unrestricted Fund: The Educational and Support subgroup of the Unrestricted Fund accounts for the general operations of the District. The Auxiliary Enterprises subgroup accounts for activities which are intended to provide non-instructional services for sales to students, staff and/or institutional departments, and which are supplemental to the educational and general objectives of the District. Restricted Fund: The Restricted Fund is used to account for resources that are available for the operation and support of the educational program but which are restricted as to their use by donors or outside agencies.

Loan Funds – The Loan Funds are used to account for loans to students, and are financed primarily by the federal government.

Endowment Funds – The Endowment Funds are used to account for resources, the principal of which is maintained inviolate to conform with restrictions by donors or other outside agencies. Generally, only the income from these funds may be used.

Plant Funds – The Plant Funds are used to account for transactions relating to investment in the District properties, and consist of the following self-balancing accounts:

Unexpended: This account is used to account for the unexpended resources derived from various sources for the acquisition or construction of plant assets. Retirement of Indebtedness: This account is used to account for the accumulation of resources for principal and interest payments on plant indebtedness.

Investment in Plant: This account is used to account for the excess of the carrying value of plant assets over the related liabilities.

Agency Funds – The Agency Funds are used to account for assets held by the Agency in a custodial capacity or as an agent for others. Agency Funds’ assets equal liabilities.

The Budgetary Comparison Schedule of Expenditures – Budget to Actual provides a comparison of the budget to actual expenditures for those funds and/or levies required to be budgeted. Since the District uses Business Type Activities reporting, this budgetary comparison information is included as supplementary information.

Notes to Supplementary Information (Continued) Year Ended June 30, 2018

48

Schedules presented in supplementary information are reported using the current financial resources measurement focus and the accrual basis of accounting with modifications for depreciation and other items included in the adjustments column. The schedule of revenues, expenditures and changes in fund balances is a schedule of financial activities related to the current reporting period. It does not purport to present the results of operations or net income or loss for the period as would a statement of income or a statement of revenues and expenses.

49

IOWA VALLEY COMMUNITY COLLEGE DISTRICT Schedule 1


Funds/Levy

Originaland FinalBudget Actual

VarianceBetweenActual

and FinalBudget

Unrestricted 24,070,240 $ 19,338,005 $ 4,732,235 $

Restricted 9,644,000 2,447,995 7,196,005 Unemployment 65,000 17,372 47,628 Tort liability 196,887 520,527 (323,640) Insurance 1,417,695 923,664 494,031 Early retirement 496,939 267,314 229,625 Equipment replacement 471,647 340,200 131,447

Total restricted 12,292,168 4,517,072 7,775,096

Plant 5,392,031 2,119,522 3,272,509 Bonds and interest 2,584,025 343,697 2,240,328

Total 44,338,464 $ 26,318,296 $ 18,020,168 $

BUDGET TO ACTUALBUDGETARY COMPARISON SCHEDULE OF EXPENDITURES -

Note to Budgetary Reporting:

The Board of Directors annually prepares a budget designating the proposed expenditures for operation of the District on a basis consistent with U.S. generally accepted accounting principles. Following required public notice and hearing, and in accordance with Chapter 260C of the Code of Iowa, the Board of Directors certifies the approved budget to the appropriate county auditors and then submits the budget to the State Board of Education for approval. The budget may be amended during the year utilizing similar statutory prescribed procedures. Formal and legal budgetary control is based on total operating expenditures.

Budgets are not required to be adopted for the Auxiliary Enterprises subgroup, Workforce Improvement Act, Iowa Code 260F Jobs Training, Scholarships and Grants account, Loan Funds and Agency Funds. For the year-ended June 30, 2018, the District’s expenditures did not exceed the amount budgeted. See accompanying Independent Auditor’s Report.


BALANCE SHEET - ALL FUNDSJune 30, 2018

Unrestricted RestrictedAssets and Deferred Outflows of Resources Funds Funds Assets

Cash and cash equivalents 1,618,420 $ 5,660,969 $ Restricted cash reserve - 264,342 Certificates of deposit 4,775,684 - Receivables:

Accounts, net of allowance of $6,102,253 994,112 640,734 Property tax:

Delinquent 6,041 1,948,081 Succeeding year 976,082 1,689,226

Due from other governments 33,411 1,027,611 Inventories 326,289 - Prepaid expenses 551,047 12,817 Capital assets:

Nondepreciable:Land - - Construction in progress - -

Depreciable:Buildings - - Improvements other than buildings - - Equipment and vehicles - -

Accumulated depreciation - -

Total assets 9,281,086 11,243,780

Deferred outflows of resources: Pension related deferred outflows - - OPEB related deferred outflows 132,324 18,764

Total deferred outflows 132,324 18,764

Total assets and deferred outflows of resources 9,413,410 $ 11,262,544 $


Current Funds

50

Schedule 2

Loan Plant AgencyFunds Funds Funds Adjustments Total

(301,462) $ 3,738,636 $ 316,452 $ -$ 11,033,015 $ - - - - 264,342 - - - - 4,775,684

- 250,000 189,501 - 2,074,347

- 17,299 - - 1,971,421 - 1,495,985 - - 4,161,293

297,962 - - - 1,358,984 - - - - 326,289 - - 4,389 - 568,253

- 3,463,786 - - 3,463,786 - 520,830 - - 520,830

- 81,694,679 - - 81,694,679 - 1,577,625 - - 1,577,625 - 7,920,495 - - 7,920,495 - - - (40,055,486) (40,055,486)

(3,500) 100,679,335 510,342 (40,055,486) 81,655,557

- - - 1,609,970 1,609,970 - - 2,785 - 153,873

- - 2,785 1,609,970 1,763,843

(3,500) $ 100,679,335 $ 513,127 $ (38,445,516) $ 83,419,400 $

Non-operating Funds


BALANCE SHEET - ALL FUNDSJune 30, 2018

Unrestricted RestrictedLiabilities, Deferred Inflows of Resources and Fund Balances Funds FundsLiabilities:

Accounts payable 263,666 $ 42,688 $ Salaries and benefits payable 1,456,492 21,751 Accrued interest payable - 9,683 Advances from grantors 173,408 1,754,281 Early retirement payable - 1,152,804 Deposits held in custody for others - - Net pension liability - - Compensated absences 335,872 - Total OPEB liability 924,490 125,130 Certificates payable - 3,910,000 Notes payable, revenue and general obligation bonds - -

Total liabilities 3,153,928 7,016,337

Deferred inflows of resources: Succeeding year property tax 976,082 1,689,226 Pension related deferred inflows - - OPEB related deferred inflows 35,089 4,976

1,011,171 1,694,202

Fund balances:Net investment in capital assets - - Restricted:

Expendable:Scholarships and fellowships - 22,678 Cash reserve - 264,342 Loans - - Iowa Industrial New Jobs Training Program - 176,160 Other - 2,088,825

Auxiliary enterprises 2,313,118 - Unrestricted 2,935,193 -

Total fund balances 5,248,311 2,552,005

Total liabilities, deferred inflows of resources and fund balances 9,413,410 $ 11,262,544 $


Current Funds

51

Schedule 2

(Continued)

Loan Plant AgencyFunds Funds Funds Adjustments Total

-$ 224,813 $ 15,017 $ -$ 546,184 $ - - 505 - 1,478,748 - 43,244 - - 52,927 - - 30,625 - 1,958,314 - - - - 1,152,804 - - 439,653 - 439,653 - - - 5,731,973 5,731,973 - - 6,607 - 342,479 - - 19,982 - 1,069,602 - - - - 3,910,000 - 7,133,750 - - 7,133,750 - 7,401,807 512,389 5,731,973 23,816,434

- 1,495,985 - - 4,161,293 - - - 852,327 852,327 - - 738 - 40,803 - 1,495,985 738 852,327 5,054,423

- 88,043,665 - (40,055,486) 47,988,179

- - - - 22,678 - - - - 264,342

(3,500) - - - (3,500) - - - - 176,160 - - - - 2,088,825 - - - - 2,313,118 - 3,737,878 - (4,974,330) 1,698,741

(3,500) 91,781,543 - (45,029,816) 54,548,543

(3,500) $ 100,679,335 $ 513,127 $ (38,445,516) $ 83,419,400 $

Non-operating Funds


ALL FUNDSYear Ended June 30, 2018

Unrestricted RestrictedFunds Funds Total

Revenues:General:

Tuition and fees 11,315,482 $ -$ 11,315,482 $ Federal appropriations 116,819 4,802,259 4,919,078 Iowa Industrial New Jobs Training Program - 343,828 343,828 State appropriations 8,929,567 1,773,245 10,702,812 Property tax 956,105 2,350,569 3,306,674 Interest income from investments 93,830 - 93,830 Increase in plant investment due to plant expenditures, including $345,010 in current fund expenditures - - - Miscellaneous 1,025,677 407,067 1,432,744

22,437,480 9,676,968 32,114,448

Auxiliary enterprises revenue 5,485,887 - 5,485,887

Total revenues 27,923,367 9,676,968 37,600,335

Expenditures:Education and support:

Liberal arts and sciences 7,396,323 19,630 7,415,953 Career and technical 2,557,938 735,762 3,293,700 Adult education 1,519,175 1,101,829 2,621,004 Cooperative services - 183,849 183,849 Administration 956,653 2,111,752 3,068,405 Student services 1,771,363 545,945 2,317,308 Learning resources 272,540 948 273,488 Physical plant 1,996,124 5,372 2,001,496 General institution 2,867,889 177,006 3,044,895 Scholarships and grants - 3,982,777 3,982,777

Total education and support 19,338,005 8,864,870 28,202,875

SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -

Current Funds

52

Schedule 3

Loan PlantFunds Funds Adjustments Total

-$ -$ (3,982,777) $ 7,332,705 $ - - - 4,919,078 - - - 343,828 - 60,975 - 10,763,787 - 2,786,610 - 6,093,284 - - - 93,830

- 865,839 (865,839) - 190,380 - - 1,623,124 190,380 3,713,424 (4,848,616) 31,169,636

- - - 5,485,887

190,380 3,713,424 (4,848,616) 36,655,523

- - 2,157 7,418,110 - - (95,380) 3,198,320 - - 1,004 2,622,008 - - - 183,849 - - (62,187) 3,006,218 - - (70,077) 2,247,231 - - 3,327 276,815 - 1,289,231 (497) 3,290,230 - - (151,886) 2,893,009 - - (3,982,777) -

- 1,289,231 (4,356,316) 25,135,790


Non-operating Funds


ALL FUNDSYear Ended June 30, 2017

Unrestricted RestrictedFunds Funds Total

Expenditures (Continued):Auxiliary enterprises 4,992,285 $ -$ 4,992,285 $ Loan cancellations and bad debt - - - Depreciation - - - Interest on indebtedness - 137,386 137,386 Plant asset acquisitions - - - Disposal of plant assets - - - Loss on disposal of capital assets - - -

Total expenditures 24,330,290 9,002,256 33,332,546

Transfers among funds, including $133,053 from agency funds (2,805,239) (333,692) (3,138,931)

Net increase (decrease) for the year 787,838 341,020 1,128,858

Fund balances beginning of year, as restated 4,460,473 2,210,985 6,671,458

Fund balances end of year 5,248,311 $ 2,552,005 $ 7,800,316 $


SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -

Current Funds

53

Schedule 3

(Continued)

Loan PlantFunds Funds Adjustments Total

-$ -$ -$ 4,992,285 $ 189,880 - - 189,880

- - 3,245,667 3,245,667 - 343,697 - 481,083 - 460,511 (460,511) - - 369,780 (369,780) - - - 1,865 1,865

189,880 2,463,219 (1,939,075) 34,046,570

- 3,271,984 - 133,053

500 4,522,189 (2,909,541) 2,742,006

(4,000) 87,259,354 (42,120,275) 51,806,537

(3,500) $ 91,781,543 $ (45,029,816) $ 54,548,543 $

Non-operating Funds


UNRESTRICTED FUNDEDUCATION AND SUPPORT


LiberalArts and Career and AdultSciences Technical Education

Revenues:Tuition and fees 7,327,020 $ 2,909,738 $ 752,970 $ Federal appropriations - - 116,819 State appropriations - - - Property tax - - - Interest income from investments - - - Sales and services - 1,080 96,703 Miscellaneous 11,545 925 39,863

Total revenues 7,338,565 2,911,743 1,006,355

Expenditures:Salaries and benefits 6,329,343 2,221,298 1,188,847 Services 205,374 55,288 253,160 Materials and supplies 68,545 198,185 58,558 Travel 51,584 18,754 13,176 Plant asset acquisitions - 7,000 - Miscellaneous 741,477 57,413 5,434

Total expenditures 7,396,323 2,557,938 1,519,175

Excess (deficiency) of revenues over (under) expenditures (57,758) 353,805 (512,820)

Transfers, non-mandatory (729,931) - -

Net change in fund balances (787,689) $ 353,805 $ (512,820) $

Fund balance beginning of year, as restated

Fund balance end of year


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

Education

54

Schedule 4

Support EducationGeneral and

Adminis- Student Learning Physical General Supporttration Services Resources Plant Institution Total

-$ 94,186 $ -$ -$ 231,568 $ 11,315,482 $ - - - - - 116,819

8,929,567 - - - - 8,929,567 956,105 - - - - 956,105

93,830 - - - - 93,830 - - - 95,692 - 193,475

760,261 12,967 5,340 500 801 832,202

10,739,763 107,153 5,340 96,192 232,369 22,437,480

863,413 1,588,737 177,008 1,443,601 1,843,062 15,655,309 198,262 64,435 9,631 354,638 884,408 2,025,196

10,107 45,533 85,873 196,134 82,065 745,000 20,566 19,113 28 1,751 22,545 147,517

- - - - - 7,000 (135,695) 53,545 - - 35,809 757,983

956,653 1,771,363 272,540 1,996,124 2,867,889 19,338,005

9,783,110 (1,664,210) (267,200) (1,899,932) (2,635,520) 3,099,475

(40,000) - - (1,984,497) (2,201) (2,756,629)

9,743,110 $ (1,664,210) $ (267,200) $ (3,884,429) $ (2,637,721) $ 342,846

2,592,347

2,935,193 $


UNRESTRICTED FUNDAUXILIARY ENTERPRISES


CafeteriaBookstore Vending Athletics

Revenues:Tuition and fees -$ -$ -$ Sales and services 994,057 1,086,397 32,080 Miscellaneous 3,376 40,726 341,672

Total revenues 997,433 1,127,123 373,752

Expenditures:Salaries and benefits 99,217 - 413,176 Services 40,339 907,041 324,467 Materials and supplies 13,019 17,271 238,372 Travel 816 - 316,376 Plant asset acquisitions - 12,492 - Purchases for resale 792,828 - 17,856 Miscellaneous (3,866) 93,966 19,249

Total expenditures 942,353 1,030,770 1,329,496

Excess (deficiency) of revenues over (under) expenditures 55,080 96,353 (955,744)

Transfers among funds, non-mandatory (102,000) - 1,010,899

Net change in fund balances (46,920) 96,353 55,155

Fund balances beginning of year, as restated 371,931 668,786 216,825

Fund balances end of year 325,011 $ 765,139 $ 271,980 $



55

Schedule 5

Housing Other Total

6,516 $ 179,448 $ 185,964 $

2,205,286 236,337 4,554,157 3,730 356,262 745,766

2,215,532 772,047 5,485,887

286,776 509,225 1,308,394 196,908 132,904 1,601,659 103,804 119,936 492,402

305 4,274 321,771 53,519 7,528 73,539

- 787 811,471 259,063 14,637 383,049 900,375 789,291 4,992,285

1,315,157 (17,244) 493,602

(964,451) 6,942 (48,610)

350,706 (10,302) 444,992

2,217,943 (1,607,359) 1,868,126

2,568,649 $ (1,617,661) $ 2,313,118 $

RESTRICTED FUNDYear Ended June 30, 2018

Unemployment Early EquipmentInsurance Compensation Retirement Replacement

Revenues:Federal appropriations -$ -$ -$ -$

Iowa Industrial New Jobs Training Program - - - - State appropriations 29,337 1,669 13,280 7,882 Property tax 1,581,608 89,991 254,034 424,936 Miscellaneous 15,323 - - -

Total revenues 1,626,268 91,660 267,314 432,818

Expenditures: Salaries and benefits - 17,372 267,314 - Services 1,475,431 - - - Materials and supplies 5,133 - - 277,282 Travel - - - - Plant asset acquisitions 6,300 - - 62,918 Interest on indebtedness - - - - Scholarships and grants - - - - Miscellaneous - - - -

Total expenditures 1,486,864 17,372 267,314 340,200

Excess (deficiency) of revenues over (under) expenditures 139,404 74,288 - 92,618

Transfers:Non-mandatory transfers in - - - - Non-mandatory transfers (out) - - - -

Net change in fund balances 139,404 74,288 - 92,618

Fund balance beginning of year, as restated 187,617 65,179 - 357,693

Fund balance end of year 327,021 $ 139,467 $ -$ 450,311 $




56

Schedule 6

Iowa Industrial WorkforceNew Jobs Investment

Cash Training Act andReserve Program Promise Jobs Scholarships Other Total

-$ -$ 496,340 $ 3,668,927 $ 636,992 $ 4,802,259 $

- 343,828 - - - 343,828 - - 14,604 - 1,706,473 1,773,245 - - - - - 2,350,569 - 128,595 421 167,146 95,582 407,067 - 472,423 511,365 3,836,073 2,439,047 9,676,968

- - 384,251 787 1,307,253 1,976,977 - 206,442 42,482 - 122,417 1,846,772 - - 14,460 - 193,690 490,565 - - 12,008 - 27,227 39,235 - - - - 88,617 157,835 - 137,386 - - - 137,386 - - - 3,863,500 211,491 4,074,991 - - 49,206 118,490 110,799 278,495 - 343,828 502,407 3,982,777 2,061,494 9,002,256

- 128,595 8,958 (146,704) 377,553 674,712

- - - 161,550 154,183 315,733 - (128,595) - - (520,830) (649,425)

- - 8,958 14,846 10,906 341,020

264,342 176,160 1,649 7,832 1,150,513 2,210,985

264,342 $ 176,160 $ 10,607 $ 22,678 $ 1,161,419 $ 2,552,005 $


AGENCY FUNDSYear Ended June 30, 2018

Iowa Small FederalStudent Business New Direct

Clubs and Jobs Training Student LoanOrganizations Program Program

Balances, beginning of year, as restated 305,180 $ 217,422 $ -$

Additions: Tuition and fees 283,538 - - Federal appropriations - - 4,935,362 State appropriations - 133,217 - Sales and service 465 - - Interest income from investments 300 - - Miscellaneous 89,901 - - Transfers in 210,095 - -

Total additions 584,299 133,217 4,935,362

Deductions:Salaries and benefits 674 - - Services 51,512 129,558 4,935,362 Materials and supplies 31,274 - - Travel 64,881 - - Plant asset acquisitions 5,645 - - Scholarships and grants 1,000 - - Miscellaneous 13,891 - - Transfers out 341,548 1,600 -

Total deductions 510,425 131,158 4,935,362

Net additions and deductions 73,874 2,059 -

Balances, end of year 379,054 $ 219,481 $ -$


SCHEDULE OF CHANGES IN DEPOSITS HELD IN CUSTODY FOR OTHERS -

57

Schedule 7

Other Total(113,822) $ 408,780 $

- 283,538 - 4,935,362 - 133,217 - 465

189 489 425,233 515,134

- 210,095

425,422 6,078,300

358,200 358,874 38,299 5,154,731 2,944 34,218 1,188 66,069

- 5,645 53,544 54,544 16,307 30,198

- 343,148

470,482 6,047,427

(45,060) 30,873

(158,882) $ 439,653 $


SCHEDULE OF CREDIT AND CONTACT HOURS *Period Ended August 14, 2018

Eligible Not EligibleCategory for Aid for Aid TotalArts and Sciences 42,694 - 42,694

Career and Technical Education 13,136 - 13,136

Adult/Continuing Education - - -

Relative services and activities - - -

55,830 - 55,830

** Includes 240 hour adjustment of 29,575 hours.


Credit Hours

* The schedule of credit and contact hours is presented on an academic year basis rather than on the fiscal year in accordance with reporting requirements required by the Iowa Department of Education.

58

Schedule 8

Eligible Not Eligiblefor Aid for Aid Total

810,364 - 810,364

316,126 - 316,126

151,765 47,127 ** 198,892

- - -

1,278,255 47,127 1,325,382

Contact Hours


SCHEDULE OF TAX AND INTERGOVERNMENTAL REVENUESFor the Last Ten Years

Year Ended 2018 2017 2016 2015

Local (property tax) 6,093,284 $ 7,768,081 $ 8,955,930 $ 7,554,817 $ State 10,763,787 10,258,293 10,617,455 11,978,042 Federal 4,919,078 5,593,866 5,757,840 6,569,644

Total 21,776,149 $ 23,620,240 $ 25,331,225 $ 26,102,503 $

See accompanying Independent Auditor's report

59

Schedule 9

June 30,2014 2013 2012 2011 2010 2009

7,643,989 $ 7,940,965 $ 7,819,243 $ 8,158,905 $ 8,387,272 $ 8,007,097 $ 10,132,422 9,322,882 8,216,581 8,404,161 8,339,792 9,703,794 6,604,255 7,442,415 8,534,320 10,537,603 9,031,124 5,635,737

24,380,666 $ 24,706,262 $ 24,570,144 $ 27,100,669 $ 25,758,188 $ 23,346,628 $


For the Last Ten Years

2018 2017 2016 2015Revenues:

Tuition and fees 11,315,482 $ 11,300,324 $ 11,087,247 $ 11,690,583 $ Federal appropriations 4,919,078 5,593,866 5,757,840 6,569,644 Iowa Industrial New Jobs Training Program 343,828 227,217 1,448,910 2,866,008 State appropriations 10,702,812 10,151,308 10,508,713 11,732,929 Property tax 3,306,674 2,825,694 3,905,788 2,484,304 Interest income on investments 93,830 75,785 47,721 20,420 Auxiliary enterprises 5,485,887 5,242,913 4,935,545 4,960,778 Sales and services 194,605 - - - Miscellaneous 1,238,138 1,513,256 1,752,641 1,753,319

Total 37,600,334 $ 36,930,363 $ 39,444,405 $ 42,077,985 $

Expenditures:Liberal arts and sciences 7,415,953 $ 7,500,489 $ 7,768,224 $ 8,155,821 $ Vocational technical 3,293,700 3,561,647 3,893,658 4,153,170 Adult education 2,621,004 2,987,789 3,596,413 3,827,531 Cooperative services 183,849 65,567 1,305,891 2,677,046 Administration 3,068,405 3,217,025 4,245,886 3,098,039 Student services 2,317,308 2,309,697 2,352,882 2,252,800 Learning resources 273,488 312,787 335,859 373,034 Physical plant 2,001,496 2,097,443 2,285,758 2,290,254 General institution 3,044,895 2,882,973 2,896,531 2,976,277 Auxiliary enterprises 4,992,285 4,730,310 4,859,821 5,322,457 Scholarships and grants 3,982,777 4,155,008 4,240,755 5,058,242 Interest on indebtedness 137,386 151,464 168,004 178,701

Total 33,332,546 $ 33,972,199 $ 37,949,682 $ 40,363,372 $


SCHEDULE OF CURRENT FUND REVENUES BY SOURCE AND EXPENDITURES BY FUNCTION

60

Schedule 10

2014 2013 2012 2011 2010 2009

12,072,785 $ 12,878,517 $ 12,568,466 $ 12,415,322 $ 11,840,096 $ 10,569,489 $ 6,604,255 7,442,415 8,534,320 10,272,918 9,031,124 5,635,737

191,781 355,490 187,996 734,179 755,284 126,998 9,621,103 8,752,513 7,802,779 7,600,479 7,454,587 9,135,825 2,600,044 2,919,367 2,869,835 3,352,247 3,414,606 3,117,447

7,816 22,903 25,589 29,730 85,802 168,850 5,200,291 5,480,533 4,940,960 5,300,121 4,301,360 3,540,993

- - - - - - 1,672,299 1,724,202 1,968,213 2,017,103 2,334,461 2,586,400

37,970,374 $ 39,575,940 $ 38,898,158 $ 41,722,099 $ 39,217,320 $ 34,881,739 $

8,248,314 $ 8,035,736 $ 7,362,342 $ 7,039,930 $ 6,563,330 $ 6,608,653 $ 3,433,801 3,206,456 3,267,483 4,062,416 3,335,223 3,516,374 3,727,980 3,883,853 3,910,942 4,005,771 4,385,891 4,325,487

124,136 232,393 116,148 139,859 906,370 123,438 3,047,019 2,947,224 3,254,711 3,760,728 4,185,175 3,843,730 2,046,400 1,942,928 2,125,020 1,898,797 2,226,385 2,595,514

344,221 340,683 362,148 308,779 403,881 531,358 2,320,602 2,276,583 2,013,582 2,416,501 2,026,131 1,980,232 2,815,296 2,749,662 2,699,167 3,287,024 3,160,641 2,797,377 5,229,251 5,581,531 5,237,646 5,889,583 5,004,438 3,906,825 5,277,670 5,948,672 6,069,431 6,708,968 5,737,046 3,674,622

88,609 129,520 169,266 213,873 226,201 259,135

36,703,299 $ 37,275,241 $ 36,587,886 $ 39,732,229 $ 38,160,712 $ 34,162,745 $

Year Ended June 30,

61


SCHEDULE OF EXPENDITURES OF FEDERAL AWARDSYear Ended June 30, 2018

Pass-ThroughFederal Entity

Federal Grantor/Pass-Through CFDA Identifying FederalGrantor/Program Name Number Number Expenditures New LoansDirect:

U.S. Department of Education:Student Financial Assistance Cluster:

Federal Supplemental Educational Opportunity Grants 84.007 116,361 $ -$ Federal Direct Student Loans 84.268 - 4,935,362 Federal Work-Study Program 84.033 113,608 - Federal Pell Grant Program 84.063 3,438,958 -

Total Student Financial Assistance Cluster 3,668,927 4,935,362

TRIO Student Support Services 84.042 362,513 -

U.S. Department of Agriculture:NIFA SPECA Advanced Integration of Precision Ag Activities 10.226 2,300 -

Total direct 4,033,740 4,935,362

Indirect:U.S. Department of Education:

Iowa Department of Education:Carl Perkins 84.048 80185 112,008 - Iowa Adult Education and Family Literacy Act (AEFLA) 84.002 FY 18 113,391 - AEFLA: State Leadership Funds 84.002 FY 18 3,358 - AEFLA: Technology Grant 84.002 FY 18 70 - Iowa Vocational Rehabilitation Intermediary 84.126 17-VRIN-07 56,707 -

Total Iowa Department of Education 285,534 -

U.S. Department of Labor:Iowa Workforce Development:

Workforce Investment Act Cluster:Adult Formula and Statewide 17.258 17-W-06-WI-OA 137,389 - Youth and Statewide 17.259 17-W-06-WI-OA 170,147 - National Dislocated Worker Grant 17.278 17-W-06-WI-OA 2,972 - Rapid Response 17.278 17-W-06-WI-OA 7,433 - General Administration 17.278 17-W-06-WI-OA 50,618 - Dislocated Worker 17.278 17-W-06-WI-OA 127,782 -

Total Workforce Investment Act Cluster 496,341 -


62


(Continued)SCHEDULE OF EXPENDITURES OF FEDERAL AWARDSYear Ended June 30, 2017

Pass-ThroughFederal Entity

Federal Grantor/Pass-Through CFDA Identifying FederalGrantor/Program Name Number Number Expenditures New LoansIndirect (Continued):

U.S. Department of Labor (continued):Hawkeye Community College:

Trade Adjustment Assistance Community College and Career Training Program 17.282 FY 18 95,302 $ -$

Total U.S. Department of Labor 591,643 $ -$

U.S. National Science Foundation: Iowa State University: Louis Stokes Alliances for Minority Participation (LSAMP) 47.076 4201809A 8,161 -

Total indirect 885,338 -

Total 4,919,078 $ 4,935,362 $

Basis of Presentation - The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal award activity of Iowa Valley Community College District under programs of the federal government for the year ended June 30, 2018. The information in this Schedule is presented in accordance with the requirements of Title 2, U.S. Code of Federal Regulations, Part 200, Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of Iowa Valley Community College District, it is not intended to and does not present the financial position, changes in financial position or cash flows of Iowa Valley Community College District. Summary of Significant Accounting Policies – Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-87, Cost Principles for State, Local and Indian Tribal Governments, or the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Indirect Cost Rate – Iowa Valley Community College District has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. See accompanying Independent Auditor’s Report.

63


Independent Auditor’s Report

on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with

Government Auditing Standards

To the Board of Directors of Iowa Valley Community College District:

We have audited in accordance with U.S. generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, the financial statements of Iowa Valley Community College District, Marshalltown, Iowa, and the aggregate discretely presented component units as of and for the year ended June 30, 2018, and the related Notes to Financial Statements, which collectively comprise the District’s basic financial statements, and have issued our report thereon dated December 7, 2018.

Internal Control Over Financial Reporting

In planning and performing our audit of the financial statements, we considered Iowa Valley Community College District’s internal control over financial reporting to determine the audit procedures appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of Iowa Valley Community College District’s internal control. Accordingly, we do not express an opinion on the effectiveness of Iowa Valley Community College District’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility a material misstatement of Iowa Valley Community College District’s financial statements will not be prevented or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and, therefore, material weaknesses or significant deficiencies may exist that were not identified.

64

Compliance and Other Matters

As part of obtaining reasonable assurance about whether Iowa Valley Community College District’s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Comments involving statutory and other legal matters about the District’s operations for the year ended June 30, 2018 are based exclusively on knowledge obtained from procedures performed during our audit of the financial statements of the District. Since our audit was based on tests and samples, not all transactions that might have had an impact on the comments were necessarily audited. The comments involving statutory and other legal matters are not intended to constitute legal interpretations of those statutes.

Purpose of this Report

The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the result of that testing and not to provide an opinion on the effectiveness of the District’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.


65


Independent Auditor’s Report on

Compliance for Each Major Federal Program and on Internal Control over Compliance

Required by the Uniform Guidance

To the Board of Directors of Iowa Valley Community College District:

Report on Compliance for Each Major Federal Program

We have audited Iowa Valley Community College District’s compliance with the types of compliance requirements described in U.S. Office of Management and Budget (OMB) Compliance Supplement that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2018. Iowa Valley Community College District’s major federal programs are identified in Part I of the accompanying Schedule of Findings and Questioned Costs.

Management’s Responsibility

Management is responsible for compliance with the requirements of laws, regulations, contracts and grant agreements applicable to its federal programs.

Auditor’s Responsibilities

Our responsibility is to express an opinion on compliance for each of Iowa Valley Community College District’s major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with U.S. generally accepted auditing standards, the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, and the audit requirements of Title 2, U.S. Code of Federal Regulations, Part 200, Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether non-compliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the District’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.

We believe our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination on Iowa Valley Community College District’s compliance.

Opinion on Each Major Federal Program

In our opinion, Iowa Valley Community College District complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2018.

66

Report on Internal Control Over Compliance

The management of Iowa Valley Community College District is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered Iowa Valley Community College District‘s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the audit procedures appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of Iowa Valley Community College District’s internal control over compliance.

A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct non-compliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance such that there is a reasonable possibility material non-compliance with a type of compliance requirement of a federal program will not be prevented or detected and corrected on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.

Our consideration of internal control over compliance was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies and, therefore, material weaknesses or significant deficiencies may exist that were not identified.

The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.


67


Schedule of Findings and Questioned Costs


Part I: Summary of the Independent Auditor’s Results:

(a) An unmodified opinion was issued on the financial statements prepared in accordance with U.S. generally accepted accounting principles.

(b) No material weaknesses in internal control over financial reporting were disclosed by the audit of the financial statements.

(c) The audit did not disclose any non-compliance which is material to the financial statements.

(d) No material weaknesses in internal control over major programs were disclosed by the audit of the financial statements.

(e) An unmodified opinion was issued on compliance with requirements applicable to each major program.

(f) The audit did not disclose audit findings that are required to be reported in accordance with the Uniform Guidance, Section 200.516.

(g) Major programs were as follows:

• Student Financial Assistance Cluster • Workforce Investment Act Cluster

(h) The dollar threshold used to distinguish between Type A and Type B programs was $750,000.

(i) Iowa Valley Community College District qualified as a low-risk auditee.

Part II: Findings Related to the Financial Statements:

Internal Control Deficiencies

No matters were reported.

Instances of Non-compliance


68

Schedule of Findings and Questioned Costs (Continued)

Year Ended June 30, 2018 Part III: Findings and Questioned Costs For Federal Awards:

Internal Control Deficiencies


Instances of Noncompliance


Part IV: Other Findings Related to Required Statutory Reporting:

IV-A-18 Certified Budget – Expenditures for the year ended June 30, 2018 did not exceed the amount budgeted.

IV-B-18 Questionable Disbursements – No expenditures we believe did not meet the requirements of public purpose as defined in an Attorney General’s opinion dated April 25, 1979 were noted.

IV-C-18 Travel Expense – No expenditures of District money for travel expenses of spouses of District officials or employees were noted. No travel advances to District officials or employees were noted.

IV-D-18 Business Transactions – No business transactions between the District and District officials or employees were noted.

IV-E-18 Bond Coverage – Surety bond coverage of District officials and employees is in accordance with statutory provisions. The amount of coverage should be reviewed annually to ensure the coverage is adequate for current operations.

IV-F-18 Board Minutes – No transactions were found that we believe should have been approved in the Board minutes but were not.

IV-G-18 Publication – The District published a statement showing the receipt and disbursement of all funds, including the names of all persons, firms or corporations to which disbursements were made, as required by Section 260C.14(12) of the Code of Iowa.

IV-H-18 Deposits and Investments – No instances of non-compliance with the deposit and investment provisions of Chapters 12B and 12C of the Code of Iowa and the District’s investment policy were noted.

IV-I-18 Credit and Contact Hours – Eligible credit and contact hours reported to the Iowa Department of Education by the District for the period ended August 14, 2018 were supported by detailed records maintained by the District.

Iowa Valley Community College District, (Merged Area VI), Iowa $4,790,000 Taxable Industrial New Jobs Training Certificates, Series 2019-2

B-1

APPENDIX B

DESCRIBING BOOK-ENTRY-ONLY ISSUANCE

1. The Depository Trust Company (“DTC”), New York, New York, will act as securities depository for the

Certificates (the “Securities”). The Securities 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 Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC.

2. DTC, the world’s largest securities 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 issues, 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 S&P Global Ratings 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.

3. Purchases of Securities under the DTC system must be made by or through Direct Participants, which will

receive a credit for the Securities on DTC’s records. The ownership interest of each actual purchaser of each Security (“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 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 Securities 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 Securities, except in the event that use of the book-entry system for the Securities is discontinued.

4. To facilitate subsequent transfers, all Securities 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 Securities 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 Securities; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Securities 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.

http://www.dtcc.com/


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5. 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 Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities 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 registrar and request that copies of notices be provided directly to them.

6. Redemption notices shall be sent to DTC. If less than all of the Securities 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.

7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the District 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 Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy).

8. Redemption proceeds, distributions, and dividend payments on the Securities 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 District 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 securities 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 District, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the District 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.

9. A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through its Participant, to any Tender/Remarketing Agent, and shall effect delivery of such Securities by causing the Direct Participant to transfer the Participant’s interest in the Securities, on DTC’s records, to any Tender/Remarketing Agent. The requirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC’s records and followed by a book-entry credit of tendered Securities to any Tender/Remarketing Agent’s DTC account.

10. DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to the District or the Paying Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered.

11. The District may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC.

12. The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that the District believes to be reliable, but the District takes no responsibility for the accuracy thereof.


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APPENDIX C

DRAFT FORM OF OPINION OF BOND COUNSEL


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APPENDIX D

DRAFT CONTINUING DISCLOSURE CERTIFICATE

This Continuing Disclosure Certificate (the "Disclosure Certificate") is executed and delivered by the Iowa Valley Community College District, State of Iowa (the "Issuer"), in connection with the issuance of $4,790,000 Taxable Industrial New Jobs Training Certificates, Series 2019-2 (the "Certificates") dated November 5, 2019. The Certificates are being issued pursuant to a Resolution of the Issuer approved on October 9, 2019 (the "Resolution"). The Issuer covenants and agrees as follows:

Section 1. Purpose of the Disclosure Certificate; Interpretation. This Disclosure Certificate is being executed and delivered by the Issuer for the benefit of the Holders and Beneficial Owners of the Certificates and in order to assist the Participating Underwriters in complying with S.E.C. Rule 15c2-12(b)(5). This Disclosure Certificate shall be governed by, construed and interpreted in accordance with the Rule, and, to the extent not in conflict with the Rule, the laws of the State. Nothing herein shall be interpreted to require more than required by the Rule.

Section 2. Definitions. In addition to the definitions set forth in the Resolution, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:

"Annual Financial Information" shall mean financial information or operating data of the type included in the final Official Statement, provided at least annually by the Issuer pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.

"Beneficial Owner" shall mean any person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Certificates (including persons holding Certificates through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Certificates for federal income tax purposes.

"Business Day" shall mean a day other than a Saturday or a Sunday or a day on which banks in Iowa are authorized or required by law to close.

"Dissemination Agent" shall mean the Issuer or any Dissemination Agent designated in writing by the Issuer and which has filed with the Issuer a written acceptance of such designation.

"Financial Obligation" shall mean a (i) debt obligation; (ii) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (iii) guarantee of (i) or (ii). The term "Financial Obligation" does not include municipal securities as to which a final official statement has been provided to the MSRB consistent with S.E.C. Rule 15c2-12.

"Holders" shall mean the registered holders of the Certificates, as recorded in the registration books of the Registrar.

"Listed Events" shall mean any of the events listed in Section 5(a) of this Disclosure Certificate.

"Municipal Securities Rulemaking Board" or "MSRB" shall mean the Municipal Securities Rulemaking Board, 1300 I Street NW, Suite 1000, Washington, DC 20005.

"National Repository" shall mean the MSRB's Electronic Municipal Market Access website, a/k/a "EMMA" (emma.msrb.org).

"Official Statement" shall mean the Issuer's Official Statement for the Certificates, dated _______________, 2019.

"Participating Underwriter" shall mean any of the original underwriters of the Certificates required to comply with the Rule in connection with offering of the Certificates.


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"Rule" shall mean Rule 15c2-12 adopted by the Securities and Exchange Commission (S.E.C.) under the Securities Exchange Act of 1934, and any guidance and procedures thereunder published by the S.E.C., as the same may be amended from time to time.

"State" shall mean the State of Iowa.

Section 3. Provision of Annual Financial Information.

a) The Issuer shall, or shall cause the Dissemination Agent to, not later than two hundred seventy (270) days after the end of the Issuer's fiscal year (presently June 30th), commencing with information for the 2018/2019 fiscal year, provide to the National Repository an Annual Financial Information filing consistent with the requirements of Section 4 of this Disclosure Certificate. The Annual Financial Information filing must be submitted in such format as is required by the MSRB (currently in "searchable PDF" format). The Annual Financial Information filing may be submitted as a single document or as separate documents comprising a package. The Annual Financial Information filing may cross-reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the Issuer may be submitted separately from the balance of the Annual Financial Information filing and later than the date required above for the filing of the Annual Financial Information if they are not available by that date. If the Issuer's fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(c).

b) If the Issuer is unable to provide to the National Repository the Annual Financial Information by the date required in subsection (a), the Issuer shall send a notice to the Municipal Securities Rulemaking Board, if any, in substantially the form attached as Exhibit A.

c) The Dissemination Agent shall:

i. each year file Annual Financial Information with the National Repository; and

ii. (if the Dissemination Agent is other than the Issuer), file a report with the Issuer certifying that the Annual Financial Information has been filed pursuant to this Disclosure Certificate, stating the date it was filed.

Section 4. Content of Annual Financial Information. The Issuer's Annual Financial Information filing shall contain or incorporate by reference the following:

a) The last available audited financial statements of the Issuer for the prior fiscal year, prepared in accordance with generally accepted accounting principles promulgated by the Financial Accounting Standards Board as modified in accordance with the governmental accounting standards promulgated by the Governmental Accounting Standards Board or as otherwise provided under State law, as in effect from time to time, or, if and to the extent such financial statements have not been prepared in accordance with generally accepted accounting principles, noting the discrepancies therefrom and the effect thereof. If the Issuer's audited financial statements for the preceding years are not available by the time Annual Financial Information is required to be filed pursuant to Section 3(a), the Annual Financial Information filing shall contain unaudited financial statements of the type included in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Financial Information when they become available.

b) A table, schedule or other information prepared as of the end of the preceding fiscal year, of the type contained in the final Official Statement under the captions "Debt Information", "Property Assessment and Tax Information", and "Financial Information".

Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the Issuer or related public entities, which have been filed with the National Repository. The Issuer shall clearly identify each such other document so included by reference.


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Section 5. Reporting of Significant Events.

a) Pursuant to the provisions of this Section, the Issuer shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Certificates in a timely manner not later than 10 Business Days after the day of the occurrence of the event:

i. Principal and interest payment delinquencies;

ii. Non-payment related defaults, if material;

iii. Unscheduled draws on debt service reserves reflecting financial difficulties;

iv. Unscheduled draws on credit enhancements relating to the Certificates reflecting financial difficulties;

v. Substitution of credit or liquidity providers, or their failure to perform;

vi. 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-exempt status of the Series Certificates, or material events affecting the tax-exempt status of the Certificates;

vii. Modifications to rights of Holders of the Certificates, if material;

viii. Certificate calls (excluding sinking fund mandatory redemptions), if material, and tender offers;

ix. Defeasances of the Certificates;

x. Release, substitution, or sale of property securing repayment of the Certificates, if material;

xi. Rating changes on the Certificates;

xii. Bankruptcy, insolvency, receivership or similar event of the Issuer;

xiii. The consummation of a merger, consolidation, or acquisition involving the Issuer or the sale of all or substantially all of the assets of the Issuer, 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;

xiv. Appointment of a successor or additional trustee or the change of name of a trustee, if material;

xv. Incurrence of a Financial Obligation of the Issuer, if material, or agreement to covenants, events of default, remedies, priority rights, or other terms of a Financial Obligation of the Issuer, any of which affect security holders, if material; and

xvi. Default, event of acceleration, termination event, modification of terms, or other similar events under the terms of a Financial Obligation of the Issuer, any of which reflect financial difficulties.

b) Whenever the Issuer obtains the knowledge of the occurrence of a Listed Event, the Issuer shall determine if the occurrence is subject to notice only if material, and if so shall as soon as possible determine if such event would be material under applicable federal securities laws.


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c) If the Issuer determines that knowledge of the occurrence of a Listed Event is not subject to materiality, or determines such occurrence is subject to materiality and would be material under applicable federal securities laws, the Issuer shall promptly, but not later than 10 Business Days after the occurrence of the event, file a notice of such occurrence with the Municipal Securities Rulemaking Board through the filing with the National Repository.

Section 6. Additional Filing. The Issuer’s audited financial statements for fiscal year ending June 30, 2019 were not available for inclusion in the Final Official Statement. The Issuer agrees to file these audited financial statements in the same manner as the Annual Financial Information when they become available.

Section 7. Termination of Reporting Obligation. The Issuer's obligations under this Disclosure Certificate with respect to each Series of Certificates shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Certificates of that Series or upon the Issuer's receipt of an opinion of nationally recognized bond counsel to the effect that, because of legislative action or final judicial action or administrative actions or proceedings, the failure of the Issuer to comply with the terms hereof will not cause Participating Underwriters to be in violation of the Rule or other applicable requirements of the Securities Exchange Act of 1934, as amended.

Section 8. Dissemination Agent. The Issuer may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent shall not be responsible in any manner for the content of any notice or report prepared by the Issuer pursuant to this Disclosure Certificate. The initial Dissemination Agent shall be the Issuer.

Section 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Issuer may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied:

a) If the amendment or waiver relates to the provisions of Section 3(a), 4, or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of an obligated person with respect to the Certificates, or the type of business conducted;

b) The undertaking, as amended or taking into account such waiver, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the original issuance of the Certificates, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and

c) The amendment or waiver either (i) is approved by the Holders of the Certificates in the same manner as provided in the Resolution for amendments to the Resolution with the consent of Holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the Holders or Beneficial Owners of the Certificates.

In the event of any amendment or waiver of a provision of this Disclosure Certificate, the Issuer shall describe such amendment in the next Annual Financial Information filing, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the Issuer. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (i) notice of such change shall be given in the same manner as for a Listed Event under Section 5(c), and (ii) the Annual Financial Information filing for the year in which the change is made will present a comparison or other discussion in narrative form (and also, if feasible, in quantitative form) describing or illustrating the material differences between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles.


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Section 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Financial Information filing or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the Issuer chooses to include any information in any Annual Financial Information filing or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Issuer shall have no obligation under this Certificate to update such information or include it in any future Annual Financial Information filing or notice of occurrence of a Listed Event.

Section 11. Default. In the event of a failure of the Issuer to comply with any provision of this Disclosure Certificate, any Holder or Beneficial Owner of the Certificates may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Issuer to comply with its obligations under this Disclosure Certificate. Direct, indirect, consequential and punitive damages shall not be recoverable by any person for any default hereunder and are hereby waived to the extent permitted by law. A default under this Disclosure Certificate shall not be deemed an event of default under the Resolution, and the sole remedy under this Disclosure Certificate in the event of any failure of the Issuer to comply with this Disclosure Certificate shall be an action to compel performance.

Section 12. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the Issuer agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys' fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The obligations of the Issuer under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Certificates.

Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the Issuer, the Dissemination Agent, the Participating Underwriters and Holders and Beneficial Owners from time to time of the Certificates, and shall create no rights in any other person or entity.

Section 14. Rescission Rights. The Issuer hereby reserves the right to rescind this Disclosure Certificate without the consent of the Holders in the event the Rule is repealed by the S.E.C. or is ruled invalid by a federal court and the time to appeal from such decision has expired. In the event of a partial repeal or invalidation of the Rule, the Issuer hereby reserves the right to rescind those provisions of this Disclosure Certificate that were required by those parts of the Rule that are so repealed or invalidated.

Date: 9th day of October, 2019. IOWA VALLEY COMMUNITY COLLEGE

DISTRICT, STATE OF IOWA

By: President of the Board of Directors ATTEST:

By: Secretary of the Board of Directors


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EXHIBIT A

NOTICE TO NATIONAL REPOSITORY OF FAILURE TO FILE ANNUAL FINANCIAL INFORMATION Name of Issuer: Iowa Valley Community College District, Iowa. Name of Certificate Issue: $4,790,000 Taxable Industrial New Jobs Training Certificates, Series 2019-2 Dated Date of Issue: November 5, 2019

NOTICE IS HEREBY GIVEN that the Issuer has not provided Annual Financial Information with respect to the above-named Certificates as required by Section 3 of the Continuing Disclosure Certificate delivered by the Issuer in connection with the Certificates. The Issuer anticipates that the Annual Financial Information will be filed by ____________________. Dated: __________ day of _______________, 20___. IOWA VALLEY COMMUNITY COLLEGE

DISTRICT, STATE OF IOWA

By: Its: 01627465-2\10740-218


APPENDIX E

IOWA COMMUNITY COLLEGES

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