CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR’S REPORTS AS OF AND FOR THE FISCAL YEAR ENDED JUNE 30, 2016 THE CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR’S REPORTS AS OF AND FOR THE FISCAL YEAR ENDED JUNE 30, 2016  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 THIS PAGE INTENTIONALLY LEFT BLANK 2  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 TABLE OF CONTENTS Page Independent Auditor’s Report on Financial Statements…………………………………… 5-6 Management’s Discussion and Analysis……………………………………………………… 7-17 The Basic Financial Statements: Government-Wide Financial Statements: Statement of Net Position …………………………………………………………………… 19 Statement of Activities ……………………………………………………………………… 20 Governmental Funds Financial Statements: Balance Sheet ………………………………………………………………………………… 22 Statement of Changes in Fund Balances……………………………………………………… 23 Reconciliation of Governmental Fund and Government-Wide Financial Statements……… 24-25 Proprietary Funds Financial Statements: Statement of Net Position……………………………………………………………………… 27 Statement of Changes in Net Position………………………………………………………… 28 Statement of Cash Flows……………………………………………………………………… 29 Discretely Presented Component Units Combining Financial Statements: Statement of Net Position……………………………………………………………………… 31 Statement of Changes in Net Position………………………………………………………… 32 Footnotes to the Basic Financial Statements ………………………………………………… 33-68 Required Supplementary Information: Budgetary Comparison Information Budgetary Comparison Schedule (Budgetary Basis) – General Fund………………………… 70 Footnotes to Budgetary Comparison Schedule………………………………………………… 71 Pension Plan Information Schedules of Pension Information…………………………………………………………… 72-75 Schedule of Funding Progress – OPEB……………………………………………………… 76 3  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Supplementary Information: Combining Balance Sheet – General Fund Accounts…………………………………………… 78 Combining Schedule of Revenues, Expenditures and Changes in Fund Balance – General Fund Accounts ………………………………………………………………………………………… 79 Combining Balance Sheet - Non-Major Governmental Funds………………………………… 80-83 Combining Statement of Revenues, Expenditures and Changes in Fund Balance - Non-Major Governmental Funds…………………………………………………………………………… 84-87 Combining Schedule of Net Position – Miami Special Utilities Authority - Enterprise Fund Account…………………………………………………………………………………………… 88 Combining Schedule of Revenues, Expenses and Changes in Net Position– Miami Special Utilities Authority – Enterprise Fund Accounts ………………………………………………………… 89 Combining Schedule of Cash Flows – Miami Special Utilities Authority – Enterprise Fund Accounts………………………………………………………………………………………… 90 Combining Statement of Net Position – Internal Service Funds……………………………….… 91 Combining Statement of Revenues, Expenses and Changes in Net Position– Internal Service Funds…………………………………………………………………………………………….. 92 Combining Statement of Cash Flows – Internal Service Funds………………………………… 93 Combining Statement of Cash Flows – Discretely Presented Component Units ……………… 94 Schedule of Expenditures of Federal Awards………………………………………………… 95 Debt Service Coverage Schedule………………………………………………………………… 96 Internal Control and Compliance Information Independent Auditor’s Report on Internal Control and Compliance Over Financial Reporting in Accordance with Government Auditing Standards…………………………… 99-100 4  INDEPENDENT AUDITOR’S REPORT To the Honorable Mayor and Members of the City Council of the City of Miami, Oklahoma Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City of Miami, Oklahoma, (the “City”) as of and for the year ended June 30, 2016, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as 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 accounting principles generally accepted in the United States of America; 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 the Miami Industrial Development Authority (“MIDA”), which represents 10 percent, 319 percent (due to accumulated deficits of other separate entities), and 17 percent, respectively, of the assets, net position, and revenues of the aggregate discretely presented component units. Those statements were audited by other auditors, whose report has been furnished to us, and our opinions, insofar as it relates to the amounts included for MIDA, are based solely on the report of the other auditors. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. 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 entity’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 entity’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 that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, based on our audit and the report of the other auditors, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the 5 309 N. Bryant Ave. • Edmond, OK 73034 • 405.348.0615 • Fax 405.348.0931 • www.jmacpas.com Member of AICPA and OSCPA business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2016, and the respective changes in financial position, and, where applicable, cash flows thereof, for the year then ended in accordance with accounting principles generally accepted in the United States of America. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, budgetary comparison information, and the pension plan and other post-employment benefits funding schedules, as listed in the table of contents, 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, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information 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. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The other supplemental information, as listed in the table of contents, is presented for purposes of additional analysis and is not a required part of the basic financial statements. The other supplementary information is the responsibility of management and was derived from and relate 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 auditing standards generally accepted in the United States of America. In our opinion, the other supplemental information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 8, 2016, on our consideration of the City’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 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 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 the City’s internal control over financial reporting and compliance. December 8, 2016 6  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016 MANAGEMENT DISCUSSION AND ANALYSIS 7  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016 Our discussion and analysis of the City of Miami’s financial performance provides an overview of the City’s financial activities for the fiscal year ended June 30, 2016. Please read it in conjunction with the City’s financial statements, which follow this section. FINANCIAL HIGHLIGHTS  For the fiscal year ended June 30, 2016, the City’s total net position increased by $2,111,734 or 5.8% from the prior year.  During the year, the City’s expenses for governmental activities were $12.2 million and were funded by program revenues of $1.5 million and further funded with taxes and other general revenues that totaled $7.4 million.  In the City’s business-type activities, such as utilities, program revenues exceeded expenses by $5.4 million.  At June 30, 2016, the General Fund reported an unassigned fund balance of $43,293.  For budgetary reporting purposes, the General Fund reported revenues under estimates of $162,885 or 2.1%, while expenditures were under the final appropriations by $881,451 or 8.3%. OVERVIEW OF THE FINANCIAL STATEMENTS The financial statements presented herein include all of the activities of the City of Miami (the “City”) and its component units using the integrated approach as prescribed by GASB Statements No. 14, 34, 39, and 61. Included in this report are governmental-wide statements for each of three categories of activities – governmental, business-type, and discretely presented component units. The government-wide financial statements present the complete financial picture of the City from the economic resources measurement focus using the accrual basis of accounting. They present governmental activities and business type activities separately and combined. These statements include all assets of the City (including infrastructure capital assets), and deferred outflows of resources, as well as all liabilities (including all long-term debt) and deferred inflows of resources. About the City The City of Miami is an incorporated municipality with a population of approximately 13,570 located in northeastern Oklahoma. The City operates under a council-manager form of government with a charter that provides for three branches of government.  Legislative – the governing body includes an elected five-member City Council and Mayor  Executive – the City Manager is the Chief Executive Officer and is appointed by the City Council  Judicial – the Municipal Judge is a practicing attorney appointed by the City Council The City’s Financial Reporting Entity This annual report includes all activities for which the City Council of the City of Miami is fiscally responsible. These activities are operated within several separate legal entities that are reported together to make up the City’s financial reporting entity. The City’s financial reporting entity includes the City of Miami, two blended component units, and four discretely presented component units. 8  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016 Primary Government: The City of Miami – incorporated municipality that operates the public safety, health and welfare, streets and highways, parks and recreation, and administrative activities as a home rule charter city Blended Component Units: Miami Special Utility Authority (MSUA) – public trust that operates the electric, water, wastewater, and solid waste/sanitation services of the City. Miami Development Authority (MDA) – public trust created to promote the development of housing in Miami. Discretely Presented Component Units (separate legal entities for which the City Council is fiscally responsible, but appoints a separate governing body): Miami Education Facilities Authority (MEFA) – public trust that promotes the development of educational facilities within the city. The trust is currently inactive. Miami Downtown Redevelopment Authority (MDRA) – public trust created to promote the redevelopment of the downtown area. The Authority does not issue separate financial statements. Miami Industrial and Public Facilities Authority (MIPFA) – public trust that promotes the use of facilities in the City of Miami area. The Authority does not issue separate financial statements. Miami Community Facilities Authority (MCFA) – public trust that promotes the development of commerce, housing, recreation, education and public facilities within the city. The Authority does not issue separate financial statements. Miami Industrial Development Authority (MIDA) – public trust that promotes industry in and around the City of Miami. The Authority issues separate financial statements. Using This Annual Report This annual report is presented in a format that substantially meets the presentation requirements of the Governmental Accounting Standards Board (GASB) in accordance with generally accepted accounting principles. The presentation includes financial statements that communicate the City’s financial position and changes therein at two distinct levels:  The City as a Whole (a government-wide presentation)  The City’s Funds (a presentation of the City’s major and aggregate non-major funds) The City’s various government-wide and fund financial statements are presented throughout this annual report and are accompanied by:  Management’s Discussion and Analysis – that provides useful analysis that facilitates a better understanding of the City’s financial condition and changes therein. 9  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016  Footnotes - that elaborate on the City’s accounting principles used in the preparation of the financial statements and further explain financial statement elements.  Supplemental Information – that provide additional information about specified elements of the financial statements, such as budgetary comparison information, and capital assets and long-term debt information. Reporting the City as a Whole The Statement of Net Position and the Statement of Activities One of the most frequently asked questions about the City’s finances is, “Has the City’s overall financial condition improved, declined or remained steady over the past year?” The Statement of Net Position and the Statement of Activities report information about the City as a whole and about its activities in a way that helps answer this question. These statements include all assets, deferred outflows, liabilities and deferred inflows using the accrual basis of accounting. All of the current year’s revenues and expenses are taken into account regardless of when cash is received or paid. These two government-wide statements report the City’s net position and changes in them from the prior year. You can think of the City’s net position – the difference between assets, deferred outflows, liabilities, and deferred inflows – as one way to measure the City’s financial condition, or position. Over time, increases or decreases in the City’s net position are one indicator of whether its financial health is improving, deteriorating, or remaining steady. However, you must consider other nonfinancial factors, such as changes in the City’s tax base, the condition of the City’s roads, and the quality of services to assess the overall health and performance of the City. As mentioned above, in the Statement of Net Position and the Statement of Activities, we divide the City into three kinds of activities:  Governmental activities -- Most of the City’s basic services are reported here, including the police, fire, general administration, streets, and parks. Sales taxes, franchise fees, fines, and state and federal grants finance most of these activities.  Business-type activities -- The City charges a fee to customers to help cover all or most of the cost of certain services it provides. The City’s water, wastewater, electric, airport, and sanitation activities are reported here.  Discretely- presented component units -- Accounts for various activities related to economic development, facility management, facility construction, and downtown development. Reporting the City’s Most Significant Funds Fund Financial Statements The fund financial statements provide detailed information about the most significant funds – not the City as a whole. Some funds are required to be established by State law and by bond covenants. However, the City Council establishes many other funds to help it control and manage money for particular purposes or to show that it is meeting legal responsibilities for using certain taxes, grants and other money. 10  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016 Governmental funds -- Most of the City’s basic services are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end that are available for spending. These funds are reported using an accounting method called modified accrual accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the City’s general government operations and the basic service it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance the City’s programs. The differences of results in the Governmental Fund financial statements to those in the Government-Wide financial statements are explained in a reconciliation following each Governmental und financial statement. Proprietary funds - When the City charges customers for the services it provides – whether to outside customers or to other units of the City – these services are generally reported in proprietary funds. Proprietary funds are reported in the same way that all activities are reported in the Statement of Net Position, the Statement of Revenues, Expenses and Changes in Fund Net Position and Statement of Cash Flows. In fact, the City’s enterprise funds are essentially the same as the business-type activities we report in the government-wide statements but provide more detail and additional information, such as cash flows. A FINANCIAL ANALYSIS OF THE CITY AS A WHOLE Net Position As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the City, assets and deferred outflows exceeded liabilities and deferred inflows by $38,271,970 at the close of the most recent fiscal year. TABLE 1 NET POSITION (In Thousands) Gove rnme ntal % Inc. Busine ss-Type % Inc. % Inc. Activitie s (De c.) Activitie s (De c.) Total (De c.) 2016 2015 2016 2015 2016 2015 Current assets $ 10,381 $ 10,789 -4% $ 13,616 $ 13,096 4% $ 23,997 $ 23,885 0% Capital assets, net 27,338 27,042 1% 18,491 18,581 0% 45,829 45,623 0% Total assets 37,719 37,831 0% 32,107 31,677 1% 69,826 69,508 0% Defe rred outflows 1,404 741 90% 679 314 116% 2,083 1,055 97% Current liabilities 3,494 2,860 22% 2,748 2,694 2% 6,242 5,554 12% Non-current liabilities 16,521 17,173 -4% 9,283 9,797 -5% 25,804 26,970 -4% Total liabilities 20,015 20,033 0% 12,031 12,491 -4% 32,046 32,524 -1% Defe rred inflows 1,337 1,565 -15% 254 313 100% 1,591 1,878 -15% Net position Net investment capital assets 17,689 16,967 4% 11,463 10,621 8% 29,152 27,588 6% Restricted 1,588 2,286 -31% 771 858 -10% 2,359 3,144 -25% Unrestricted (deficit) (1,506) (2,279) -34% 8,267 7,708 7% 6,761 5,429 25% Total ne t positin $ 17,771 $ 16,974 5% $ 20,501 $ 19,187 7% $ 38,272 $ 36,161 6% 11  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016 The largest portion of the City’s net position reflects its net investment capital assets (e.g., land, buildings, machinery, and equipment); less any related debt used to acquire those assets that are still outstanding. For 2016, the net investment in capital assets amounted to $29,151,923. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. A major portion of the City’s net position, $2,358,141 also represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position, $6,761,906, may be used to meet the government’s ongoing obligations to citizens and creditors. At the end of the current fiscal year, the City is able to report positive balances in all three categories of net position for the government as a whole. Explanations of significant changes displayed in Table 1 are as follows: Governmental Activities: Deferred outflows – Increases due to deferral related to fire, police, and non-uniformed employee pension. Net positon restricted – Decrease of $.7 million (31%) due to the use of restricted construction proceeds. Net position unrestricted – Increase of $1.7 million (34%) due to an revenues exceeding expense in the current year and increase in deferred outflows. Business-Type Activities: Deferred outflows – Increases due to deferral related to non-uniformed employee pension. Changes in Net Position For the year ended June 30, 2016, net position of the primary government changed as follows: 12  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016 TABLE 2 CHANGES IN NET POSITION (In Thousands) Governmental % Inc. Business-Type % Inc. % Inc. Activities (Dec.) Activities (Dec.) Total (Dec.) 2016 2015 2016 2015 2016 2015 Revenues Charges for service $ 709 $ 683 4% $ 23,419 $ 25,347 -8% $ 24,128 $ 26,030 -7% Operating grants and contributions 759 724 5% 2 - - 761 724 5% Capital grants and contributions 64 - 100% 532 1,357 -61% 596 1,357 -56% Taxes 7,215 7,204 0% - - - 7,215 7,204 0% Investment income 15 13 15% 12 1 1100% 27 14 93% M iscellaneous 185 200 -8% 1 22 -95% 186 222 -16% Total revenues 8,947 8,824 1% 23,966 26,727 -10% 32,913 35,551 -7% Expenses General government 2,411 2,067 17% - - - 2,411 2,067 17% Public safety 4,990 4,751 5% - - - 4,990 4,751 5% Streets 2,432 3,460 -30% - - - 2,432 3,460 -30% Culture and recreation 1,305 1,289 1% - - - 1,305 1,289 1% Economic development 507 585 -13% - - - 507 585 -13% Interest on debt 593 622 -5% - - - 593 622 -5% Water - - - 1,553 1,597 -3% 1,553 1,597 -3% Wastewater - - - 1,429 1,436 - 1,429 1,436 - Sanitation - - - 1,506 1,513 0% 1,506 1,513 0% Electric - - - 13,660 15,848 -14% 13,660 15,848 -14% Airport - - - 415 235 77% 415 235 77% Total expenses 12,238 12,774 -4% 18,563 20,629 -10% 30,801 33,403 8% Excess (deficiency) before transfers (3,291) (3,950) 17% 5,403 6,098 -11% 2,112 2,148 -2% Transfers 4,088 5,195 -21% (4,088) (5,195) -21% - - - Change in net position $ 797 $ 1,245 -36% $ 1,315 $ 903 46% $ 2,112 $ 2,148 -2% Explanations of significant changes in Table 2 are as follows: Governmental Activities: General Government – Increase of $.4 million (17%) due to an increase in operational cost. Streets – Decrease of $1 million (30%) due to a decrease in operational cost. Transfers – Decease in budgetary subsidy from the MSUA to the governmental funds. Business-Type Activities: Capital grants and contributions – Decrease of $.8 million (61%) due to a decrease in airport grants. Electric – Decrease of $2 million (14%) due to a decrease in operational cost. Transfers – Decrease in budgetary subsidy from the MSUA to the governmental funds. 13  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016 Governmental Activities To aid in the understanding of the Statement of Activities some additional explanation is given. Of particular interest is the format that is significantly different than a typical Statement of Revenues, Expenses, and Changes in Fund Balance. You will notice that expenses are listed in the first column with revenues from that particular program reported to the right. The result is a Net (Expense)/Revenue. The reason for this kind of format is to highlight the relative financial burden of each of the functions on the City’s taxpayers. It also identifies how much each function draws from the general revenues or if it is self-financing through fees and grants or contributions. All other governmental revenues are reported as general. It is important to note all taxes are classified as general revenue even if restricted for a specific purpose. TABLE 3 Net Revenue (Expense) of Governmental Activities (In Thousands) Net Revenue Total Expense % Inc. (Expense) % Inc. of S ervices (Dec.) of S ervices (Dec.) 2016 2015 2016 2015 General government $ 2,411 $ 2,067 17% $ (2,328) $ (1,932) 21% Public safety 4,990 4,751 5% (4,127) (3,978) 4% Streets 2,432 3,460 -30% (2,154) (3,230) -33% Culture, parks and recreation 1,305 1,289 1% (1,029) (1,028) 0% Economic development 507 585 -13% (474) (576) -18% Interest on long-term debt 593 622 5% (593) (622) -5% Total $ 12,238 $ 12,774 -4% ($10,706) $ (11,366) -6% For the year ended June 30, 2016 total expenses for governmental activities amounted to approximately $12.2 million which was a decrease from the prior year of 4%. See Table 2 above for explanations of changes. Business-type Activities TABLE 4 Net Revenue (Expense) of Business-Type Activities (In Thousands) Net Revenue Total Expense % Inc. (Expense) % Inc. of S ervices Dec. of S ervices Dec. 2016 2015 2016 2015 Water $ 1,553 $ 1,597 -3% $ 965 $ 858 12% Wastewater 1,429 1,436 - 672 338 99% Sanitation 1,507 1,513 0% 774 716 8% Electric 13,659 15,848 -14% 3,273 3,036 8% Airport 415 235 77% (295) 1,126 -126% Total $ 18,563 $ 20,629 -10% $ 5,389 $ 6,074 -11% The City’s business-type activities include utility services for water, electric, wastewater, sanitation and airport. 14  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016 In reviewing the business-type activities net (expense)/revenue, the following highlights should be noted:  Total business-type activities reported net revenues of $5,388,721 for the year ended June 30, 2016.  Airport operational cost exceeded revenues due the completion of capital grants for airport construction. A FINANCIAL ANALYSIS OF THE CITY’S FUNDS As the City completed its 2016 fiscal year, the governmental funds reported a combined fund balance of $6.9 million or a 12% decrease of approximately $939,000 mainly due to a decrease in transfers from the enterprise fund for an operational subsidy. The enterprise funds reported combined net position of $19.8 million or a 7.0% increase from 2015 mainly related to an increase in operational revenue and the decrease in operational transfers to the governmental funds. Fund Balance/Net Position Governmental Funds Proprietary Funds Restricted $ 1,843,214 Net investment in capital assets $ 11,463,032 Committed 2,830,627 Restricted for debt service and other 770,622 Assigned 2,163,322 Unrestricted 7,611,870 Unassigned 43,293 Total Fund Balance $ 6,880,456 Total Net Position $ 19,845,524 General Fund Budgetary Highlights For budgetary reporting purposes, the General Fund reported revenues under estimates of $162,885 or 2.1%, while expenditures were under the final appropriations by $881,451 or 8.3%. CAPITAL ASSET AND DEBT ADMINISTRATION Capital Assets At the end of June 30, 2016, the City had $45.8 million invested in capital assets, net of depreciation, including police and fire equipment, buildings, park facilities, electrical infrastructure, water lines and sewer lines. (See table below). This represents a net increase of $.3 million or .4% from last year. TABLE 5 Capital Assets (In Thousands) (Net of accumulated depreciation) Governmental Business-Type Activities Activities Total 2016 2015 2016 2015 2016 2015 Land $ 5,487 $ 5,487 $ 751 $ 751 6,238 $ 6,238 Buildings 4,597 4,932 9,851 7,528 14,448 12,460 M achinery, furniture and equipment 2,532 2,785 3,340 3,801 5,872 6,586 Infrastructure 13,714 11,697 4,004 3,238 17,718 14,935 Construction in progress 1,009 2,141 545 3,263 1,554 5,404 Totals $ 27,339 $ 27,042 $ 18,491 $ 18,581 $ 45,830 $ 45,623 15  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016 This year’s more significant capital asset additions placed into service included: Sewer projects $489,960 Street projects $2,515,074 Airport improvement projects $2,815,298 See Note 6 to the financial statements for more detail information on the City’s capital assets and changes therein. Long- Term Debt At year-end, the City had $17.7 million in long-term debt outstanding which represents a $2.0 million decrease, or 10.3%, from the prior year. The City’s changes in long-term debt by type of debt are as follows: TABLE 6 Long-Term Debt (In Thousands) Governmental Business-Type Activities Activities Total 2016 2015 2016 2015 2016 2015 Accrued absences $ 585 $ 595 $ 183 $ 176 $ 768 $ 771 Revenue Bonds 9,045 9,790 1,190 1,375 10,235 11,165 Bond Premium (Discount) (58) (64) (8) (9) (66) (73) Notes Payable - - 5,306 5,887 5,306 5,887 Capital Leases 947 1,259 539 763 1,486 2,022 Totals $ 10,519 $ 11,580 $ 7,210 $ 8,192 $ 17,729 $ 19,772 See Note 8 to the financial statements for more detail information on the City’s long-term debt and changes therein. The Upcoming Year The City of Miami is expecting a $1.5M dip in FY 2016-2017 utility revenue due to a negative Power Cost Adjustment from our wholesale electric supplier, Grand River Dam Authority, which is passed on to our customers. However, the expected purchase power expense is also projected to be lower by a minimum of $500,000. Spending has been modified to compensate. The City will spend the upcoming year completing projects with an emphasis on facility’s rehabilitation, which includes a large civic center rehabilitation project; implementing the approved comprehensive plan; street and utility improvements; installing a splash pad; and completing our new animal shelter. The FY 2016-2017 budget will remain level. The City expects to continue to be impacted by a struggling economy but by building financial capacity via a reshaping of budget priorities the City will improve budget stabilization for the future. 16  CITY OF MIAMI, OKLAHOMA MANAGEMENT’S DISCUSSION AND ANALYSIS As of and for the Year Ended June 30, 2016 During FY 2016-2017 the City plans to combine the street program bonds with the stadium program bond anticipation notes and refinance into one set of bonds which will be repaid by the .65% sales tax. The City will also continue revenue bond projects on various utility improvements such as completing the well south of town and will start another utility improvement revenue bond project. Utility funds will continue to repay the debts. The primary sources of revenue for the City of Miami are Sales Tax and water and electric revenue. Sales tax requires a vote of the people and cannot be adjusted without the people’s consent. The City continues to look for ways to enhance our revenue base that will assist in the completion of major infrastructure and development projects. Contacting the City’s Financial Management This report is designed to provide our citizens, taxpayers, customers and creditors with an understanding of the City’s finances and to demonstrate the City’s accountability for the resources it receives. If you have questions about this report or need additional financial information, contact: City of Miami PO Box 1288 Miami, OK 74355-1288 17  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 BASIC FINANCIAL STATEMENTS – GOVERNMENT-WIDE 18  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Statement of Net Position– June 30, 2016 Discretely Presented Primary Government Component Units Governmental Business-type Activities Activities Total ASSETS Cash and equivalents $ 8,122,699 $ 5,657,814 $ 13,780,513 $ 689,681 Investments 634,823 2,856,074 3,490,897 - Interest receivable - 809 809 - Accounts receivable, net 151,383 3,497,015 3,648,398 - Due from other governments 876,562 4,731 881,293 - Other receivables 1,223,523 17,678 1,241,201 700 Internal balances (628,433) 628,433 - - Inventory - 953,844 953,844 - Capital Assets Land and construction in progress 6,495,788 1,295,580 7,791,368 247,946 Other capital assets, net of depreciation 20,842,628 17,195,004 38,037,632 9,475,679 Total Assets 37,718,973 32,106,982 69,825,955 10,414,006 DEFERRED OUTFLOWS: Deferred amounts related to pensions 1,404,068 679,012 2,083,080 - LIABILITIES Accounts payable and accrued liabilities 960,502 1,680,042 2,640,544 16,044 Claims liability 1,414,290 - 1,414,290 - Accrued interest payable 27,127 41,818 68,945 2,445 Long-term liabilities Due within one year 1,092,279 1,025,781 2,118,060 9,566,480 Due in more than one year 16,520,902 9,282,844 25,803,746 657,033 Total liabilities 20,015,100 12,030,485 32,045,585 10,242,002 DEFERRED INFLOWS: Deferred amounts related to pensions 1,337,429 254,051 1,591,480 - Total deferred inflows 1,337,429 254,051 1,591,480 - NET POSITION: Net investment in capital assets 17,688,891 11,463,032 29,151,923 (394,671) Net Position: Restricted 1,587,519 770,622 2,358,141 - Unrestricted (deficit) (1,505,898) 8,267,804 6,761,906 566,675 Total net position $ 17,770,512 $ 20,501,458 $ 38,271,970 $ 172,004 See accompanying notes to the basic financial statements. 19  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Statement of Activities –Year Ended June 30, 2016 Net (Expense) Revenue and Changes in Net Position Program Revenue Primary Government Discretely Operating Capital Grants Presented Charges for Grants and and Governmental Business-type Component Functions/Programs Expenses Services Contributions Contributions Activities Activities Total Units Primary government Governmental Activities General Government $ 2,411,358 $ 74,978 $ 7,994 $ - $ (2,328,386) $ - $ (2,328,386) $ - Public Safety 4,990,387 295,683 567,365 - (4,127,339) - (4,127,339) - Public Works and Streets 2,432,057 88,151 125,521 63,905 (2,154,480) - (2,154,480) - Culture and Recreation 1,304,931 217,463 58,222 - (1,029,246) - (1,029,246) - Economic Development 506,839 33,091 - - (473,748) - (473,748) - Interest on long-term Debt 592,820 - - - (592,820) - (592,820) - Total governmental activities 12,238,392 709,366 759,102 63,905 (10,706,019) - (10,706,019) - Business-type activities Water 1,552,682 2,314,954 - 202,535 - 964,807 964,807 - Wastewater 1,429,098 1,775,841 - 324,934 - 671,677 671,677 - Sanitation 1,506,567 2,280,751 - - - 774,184 774,184 - Electric 13,659,504 16,932,905 - - - 3,273,401 3,273,401 - Airport 415,009 113,205 1,725 4,731 - (295,348) (295,348) - Total business-type activities 18,562,860 23,417,656 1,725 532,200 - 5,388,721 5,388,721 - Total primary government $ 30,801,252 $ 24,127,022 $ 760,827 $ 596,105 (10,706,019) 5,388,721 (5,317,298) - Component Units Culture and Recreation $ 790,406 $ 298,608 $ 177,374 $ - (314,424) Economic Development 88,902 115,188 - - 26,286 Total component units $ 879,308 $ 413,796 $ 177,374 $ - (288,138) General revenues: Taxes: Sales and use taxes 6,679,232 - 6,679,232 - Property tax 18,517 - 18,517 - Franchise and public service taxes 306,304 - 306,304 - Hotel/motel taxes 210,624 - 210,624 - Investment income 15,020 12,239 27,259 216 Miscellaneous 185,656 1,440 187,096 - Transfers - internal activity 4,087,574 (4,087,574) - - Total general revenues and transfers 11,502,927 (4,073,895) 7,429,032 216 Change in net position 796,908 1,314,826 2,111,734 (287,922) Net position - beginning 16,973,604 19,186,632 36,160,236 459,926 Net position - ending $ 17,770,512 $ 20,501,458 $ 38,271,970 $ 172,004 See accompanying notes to the basic financial statements. 20  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 BASIC FINANCIAL STATEMENTS - GOVERNMENTAL FUNDS 21  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Governmental Funds Balance Sheet - June 30, 2016 Other Total G.O. Street Governmental Governmental General Fund Project Fund Funds Funds ASSETS Cash and cash equivalents $ 1,130,271 $ 951,767 $ 4,822,096 $ 6,904,134 Investments 18,417 - - 18,417 Receivables: Accounts receivable 117,627 - 33,756 151,383 Due from other funds 95,295 - 43,231 138,526 Due from other governments and entities 674,152 136,585 65,825 876,562 Total assets $ 2,035,762 $ 1,088,352 $ 4,964,908 $ 8,089,022 LIABILITIES, DEFERRED INFLOWS AND FUND BALANCES Liabilities: Accounts payable and accrued liabilities $ 132,162 $ 12,700 $ 579,381 $ 724,243 Wages payable 223,764 - 11,872 235,636 Due to other funds 66,964 - 36,574 103,538 Total liabilities 422,890 12,700 627,827 1,063,417 DEFERRED INFLOWS OF RESOURCES Deferred revenue 89,739 - 55,410 145,149 Fund balances: Restricted 7,639 1,075,652 759,923 1,843,214 Commited - - 2,830,627 2,830,627 Assigned 1,472,201 - 691,121 2,163,322 Unassigned 43,293 - - 43,293 Total fund balances 1,523,133 1,075,652 4,281,671 6,880,456 Total liabilities, deferred inflows and fund balances $ 2,035,762 $ 1,088,352 $ 4,964,908 $ 8,089,022 See accompanying notes to the basic financial statements. 22  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Governmental Funds Statement of Changes in Fund Balances – Year Ended June 30, 2016 Other Total G.O. Street Governmental Governmental General Fund Project Fund Funds Funds REVENUES Taxes $ 5,578,456 $ 1,127,514 $ 366,322 $ 7,072,292 Intergovernmental 765,478 - 210,926 976,404 Charges for services 218,751 - 126,747 345,498 Fines and forfeitures 225,796 - - 225,796 Licenses and permits 65,328 - - 65,328 Investment income 14,679 53 288 15,020 Miscellaneous 188,802 - 73,296 262,098 Total revenues 7,057,290 1,127,567 777,579 8,962,436 EXPENDITURES Current: General government 2,327,098 - 1,768 2,328,866 Public Safety 5,066,228 - 18,025 5,084,253 Public works and streets 1,233,102 16,254 215,955 1,465,311 Culture and recreation 1,086,491 - 73,587 1,160,078 Economic development 433,370 - - 433,370 Capital Outlay 7,488 543,053 1,479,880 2,030,421 Debt Service: Principal 166,593 745,000 145,431 1,057,024 Interest and other charges 36,755 337,028 9,868 383,651 Total expenditures 10,357,125 1,641,335 1,944,514 13,942,974 Excess (deficiency) of revenues over (3,299,835) (513,768) (1,166,935) (4,980,538) OTHER FINANCING SOURCES (USES) Transfers in 9,143,848 1,136,171 1,481,691 11,761,710 Transfers out (6,345,498) (1,130,020) (245,521) (7,721,039) Total other financing sources and uses 2,798,350 6,151 1,236,170 4,040,671 Net change in fund balances (501,485) (507,617) 69,235 (939,867) Fund balances - beginning 2,024,618 1,583,269 4,212,436 7,820,323 Fund balances - ending $ 1,523,133 $ 1,075,652 $ 4,281,671 $ 6,880,456 See accompanying notes to the basic financial statements. 23  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Reconciliation of Governmental Funds and Government-Wide Financial Statements: Fund Balance – Net Position Reconciliation: Total fund balance, governmental funds $ 6,880,456 Amounts reported for governmental activities in the Statement of Net Position are different because: Capital assets used in governmental activities are not current financial resources and therefore are not reported in this fund financial statement, but are reported in the governmental activities of the Statement of Net Position. 27,338,416 Certain long-term assets are not available to pay for current fund liabilities and, therefore, are deferred in the funds. 145,149 Certain other long-term assets are not available to pay current period expenditures and therefore they, along with deferred outflows, are not reported in this fund financial statement, but are reported in the governmental activities of the Statement of Net Position. Pension related deferred outflows 1,404,068 Some liabilities are not due and payable in the current period and, along with deferred inflows, are not included in the fund financial statement, but are included in the governmental activities of the Statement of Net Position: Capital lease obligations (946,768) Interest payable (27,127) Net pension liability (6,731,660) Pension related deferred inflows (1,337,429) Other post employment benefit obligation (362,834) Accrued compensated absences (585,184) Unamortized debt discount 58,265 Note payable (9,045,000) Internal service funds are used by management to charge costs of certain activities that benefit multiple funds, such as self-insurance, to individual funds. The net position of the internal service funds are reported in governmental activities: Internal service fund net position 980,160 Net Position of Governmental Activities in the Statement of Net Position $ 17,770,512 See accompanying notes to the basic financial statements. 24  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Changes in Fund Balances – Changes in Net Position Reconciliation: Net change in fund balances - total governmental funds: $ (939,867) Amounts reported for Governmental Activities in the Statement of Activities are different because: Governmental funds report capital outlays as expenditures while governmental activities report depreciation expense to allocate those expenditures over the life of the assets: Capital asset purchases capitalized 1,879,639 Capital assets donated 46,903 Depreciation expense (1,630,124) In the Statement of Activities, the net cost of pension benefits earned is calculated and reported as pension expense. The fund financial statements report pension contributions as expenditures. This amount represents the difference between pension contributions and calculated pension expense. 504,900 Revenues in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds: Change in deferred revenue 17,756 Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the Statement of Net Position: Capital lease principal payments 312,024 Revenue bond principal payments 745,000 Some expenses reported in the statement of activities do not require the use of current financial resources and these are not reported as expenditures in governmental funds: Change in accrued interest payable 1,334 Change in accrued compensated absences 10,267 Change in other post employment benefits (147,588) Change in amortization of bond discount (6,188) Internal service fund activity is reported as a proprietary fund in fund financial statements, but certain net revenues are reported in governmental activities on the Statement of Activities: Total change in net position for internal service funds 2,852 Change in net position of governmental activities $ 796,908 See accompanying notes to the basic financial statements. 25  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 BASIC FINANCIAL STATEMENTS - PROPRIETARY FUNDS 26  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Proprietary Funds Statement of Net Position - June 30, 2016 Enterprise Funds Miami Special Utility Internal Authority Airport Fund Total Service Funds ASSETS Current assets: Cash and cash equivalents $ 4,458,553 $ 1,969 $ 4,460,522 $ 1,218,565 Cash and cash equivalents, restricted 761,770 - 761,770 - Investments 2,668,606 - 2,668,606 616,406 Accounts receivable, net 3,460,653 36,362 3,497,015 - Other receivable 436 21,973 22,409 1,223,523 Accrued interest receivable 809 - 809 - Inventory 927,789 26,055 953,844 - Due from other funds 30,571 30,128 60,699 - Total current assets 12,309,187 116,487 12,425,674 3,058,494 Non-current assets: Cash and cash equivalents, restricted 435,522 - 435,522 - Investments, restricted 187,468 - 187,468 - Capital assets: Land, construction in progress, and water rights 1,277,719 17,861 1,295,580 - Other capital assets, net of accumulated depreciation 13,686,926 3,508,078 17,195,004 - Total non-current assets 15,587,635 3,525,939 19,113,574 - Total assets 27,896,822 3,642,426 31,539,248 3,058,494 DEFERRED OUTFLOW OF RESOURCES Deferred amounts related to pensions 646,690 32,322 679,012 - LIABILITIES Current liabilities: Accounts payable and accrued liabilities 1,540,576 9,895 1,550,471 623 Claims liability - - - 1,414,290 Wages payable 128,656 915 129,571 - Due to other funds 86,495 1,705 88,200 7,487 Accrued interest payable 41,818 - 41,818 - Accrued compensated absences 18,289 - 18,289 - Refundable deposits 39,958 - 39,958 - Capital lease payable 187,906 - 187,906 - Revenue bond payable 190,000 - 190,000 - Notes payable 589,628 - 589,628 - Total current liabilities 2,823,326 12,515 2,835,841 1,422,400 Non-current liabilities: Accrued compensated absences 164,603 - 164,603 - Net pension liability 2,455,775 46,689 2,502,464 - Net OPEB obligation 196,136 - 196,136 - Refundable deposits 359,622 - 359,622 - Capital lease payable 351,580 - 351,580 - Revenue bond payable 992,002 - 992,002 - Notes payable, net 4,716,437 - 4,716,437 - Total non-current liabilities 9,236,155 46,689 9,282,844 - Total liabilities 12,059,481 59,204 12,118,685 1,422,400 DEFERRED INFLOW OF RESOURCES Deferred amounts related to pensions 249,311 4,740 254,051 - NET POSITION Net investment in capital assets 7,937,093 3,525,939 11,463,032 - Restricted for debt service 770,622 - 770,622 - Unrestricted 7,527,005 84,865 7,611,870 1,636,094 Total net position $ 16,234,720 $ 3,610,804 19,845,524 $ 1,636,094 Some amounts reported for business-type activities in the Statement of Net Position are different because certain internal service fund balances are included with business-type activities and reported as interfund balances 655,934 Total net position per Government-Wide financial statements $ 20,501,458 See accompanying notes to the basic financial statements. 27  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Proprietary Funds Statement of Changes in Net Position - Year Ended June 30, 2016 Enterprise Funds Miami Special Utility Internal Service Authority Airport Fund Total Fund REVENUES Charges for services $ 22,396,293 $ 113,649 $ 22,509,942 $ 2,048,699 Fees, licenses and permits 135,562 - 135,562 - Miscellaneous 765,917 - 765,917 1,150,686 Total operating revenues 23,297,772 113,649 23,411,421 3,199,385 OPERATING EXPENSES Personal services 3,889,924 74,403 3,964,327 - Materials and supplies 10,292,429 83,786 10,376,215 - Other services and charges 2,613,607 43,578 2,657,185 505,936 Insurance claims and expense - - - 2,673,112 Depreciation expense 1,238,851 213,242 1,452,093 - Total operating expenses 18,034,811 415,009 18,449,820 3,179,048 Operating income (loss) 5,262,961 (301,360) 4,961,601 20,337 NON-OPERATING REVENUES (EXPENSES) Investment income 12,239 - 12,239 5,825 Miscellaneous 7,686 1,714 9,400 - Interest expense and fiscal charges (183,253) - (183,253) - Total non-operating revenue (expenses) (163,328) 1,714 (161,614) 5,825 Income (loss) before contrbutions and transfers 5,099,633 (299,646) 4,799,987 26,162 Contributed capital revenue 682,751 30,296 713,047 - Transfers in 6,406,149 - 6,406,149 330,000 Transfers out (10,627,667) - (10,627,667) (330,000) Change in net position 1,560,866 (269,350) 1,291,516 26,162 Total net position - beginning 14,673,854 3,880,154 18,554,008 1,609,932 Total net position - ending $ 16,234,720 $ 3,610,804 $ 19,845,524 $ 1,636,094 Change in net position above 1,291,516 Some amounts reported for business-type activities in the Statement of Activities are difference because the net revenue of certain internal service funds is reported with business-type activities 23,310 Change in Business-Type Activities in Net Position per Government-Wide Financial Statements $ 1,314,826 See accompanying notes to the basic financial statements. 28  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Proprietary Funds Statement of Cash Flows - Year Ended June 30, 2016 Enterprise Funds Miami Special Utility Internal Service Authority Airport Fund Total Fund CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers $ 23,290,366 $ 132,657 $ 23,423,023 $ 2,733,232 Payments to suppliers (12,938,594) (109,961) (13,048,555) (505,936) Payments to employees (3,815,767) (70,214) (3,885,981) - Receipts from other funds 31,992 117 32,109 7,487 Payments to other funds (28,449) - (28,449) - Receipts of customer meter deposits 172,509 - 172,509 - Refunds of customer meter deposits (197,730) - (197,730) - Claims and judgments paid - - - (2,433,418) Net cash provided by (used in) operating activities 6,514,327 (47,401) 6,466,926 (198,635) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers from other funds 6,406,149 - 6,406,149 330,000 Transfers to other funds (10,627,667) - (10,627,667) (330,000) Net cash provided by (used in) noncapital financing activities (4,221,518) - (4,221,518) - CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Capital assets purchased (850,516) (5,000) (855,516) - Principal paid on debt (989,834) - (989,834) - Proceeds of capital grants 202,535 4,731 207,266 - Interest and fiscal agent fees paid on debt (186,895) - (186,895) - Net cash provided by (used in) capital and related financing activities (1,824,710) (269) (1,824,979) - CASH FLOWS FROM INVESTING ACTIVITIES Sale (Purchase) of investments (12,788) - (12,788) (5,825) Interest and dividends 12,240 - 12,240 5,825 Net cash provided by (used in) investing activities (548) - (548) - Net increase (decrease) in cash and cash equivalents 467,551 (47,670) 419,881 (198,635) Balances - beginning of year 5,188,294 49,639 5,237,933 1,417,200 Balances - end of year $ 5,655,845 $ 1,969 $ 5,657,814 $ 1,218,565 Reconciliation to Statement of Net Position: Cash and cash equivalents $ 4,458,553 $ 1,969 $ 4,460,522 $ 1,218,565 Restricted cash and cash equivalents - current 761,770 - 761,770 - Restricted cash and cash equivalents - noncurrent 435,522 - 435,522 - Total cash and cash equivalents, end of year $ 5,655,845 $ 1,969 $ 5,657,814 $ 1,218,565 Reconciliation of operating income (loss) to net cash provided by (used in) operating activities: Operating income (loss) $ 5,262,961 $ (301,360) $ 4,961,601 $ 20,337 Adjustments to reconcile operating income (loss) to net cash provided by (used in) operating activities: Depreciation expense 1,238,851 213,242 1,452,093 - Other nonoperating revenue 7,686 1,714 9,400 - Change in assets and liabilities: Receivables, net (14,988) 1,472 (13,516) (466,153) Other receivable (104) 15,822 15,718 - Due from other funds 7,222 - 7,222 - Inventory (80,582) 10,528 (70,054) - Deferred outflows related to pension (174,954) (30,191) (205,145) - Accounts payable 48,024 6,875 54,899 623 Claims liability - - - 239,071 Due to other funds (3,679) 117 (3,562) 7,487 Due to employees 28,274 (569) 27,705 - Refundable deposits (25,221) - (25,221) - Unfunded OPEB obligation 79,781 - 79,781 - Net pension liability 355,978 32,335 388,313 - Accrued compensated absences 6,829 - 6,829 - Deferred inflows related to pension (221,751) 2,614 (219,137) Net cash provided by (used in) operating activities $ 6,514,327 $ (47,401) $ 6,466,926 $ (198,635) Noncash activities: Asset contributed by others $ 1,102,792 $ 25,565 $ 1,128,357 $ - $ 1,102,792 $ 25,565 $ 1,128,357 $ - See accompanying notes to the basic financial statements. 29  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 BASIC FINANCIAL STATEMENTS – DISCRETELY PRESENTED COMPONENT UNITS 30  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Discretely Presented Component Units Combining Statement of Net Position - June 30, 2016 MCFA MDRA MIDA MIPFA Total ASSETS Current assets: Cash and cash equivalents $ 251,539 $ 30,180 $ 183,790 $ 224,172 $ 689,681 Receivables: Other receivable 700 - - - 700 Total current assets 252,239 30,180 183,790 224,172 690,381 Non-current assets: Capital assets: Land, construction in progress, and water rights - - 103,517 144,429 247,946 Other capital assets, net of accumulated depreciation 8,356,287 15,152 808,541 295,699 9,475,679 Total non-current assets 8,356,287 15,152 912,058 440,128 9,723,625 Total assets 8,608,526 45,332 1,095,848 664,300 10,414,006 LIABILITIES Current liabilities: Accounts payable and accrued liabilities 1,371 11,673 - 3,000 16,044 Interest payable 814 - 1,631 - 2,445 Accrued compensated absences - 2,217 - - 2,217 Notes payable 9,409,785 103,000 51,478 - 9,564,263 Total current liabilities 9,411,970 116,890 53,109 3,000 9,584,969 Non-current liabilities: Notes payable, net 163,845 - 493,188 - 657,033 Total non-current liabilities 163,845 - 493,188 - 657,033 Total liabilities 9,575,815 116,890 546,297 3,000 10,242,002 NET POSITION Net investment in capital assets (1,217,343) 15,152 367,392 440,128 (394,671) Unrestricted (deficit) 250,054 (86,710) 182,159 221,172 566,675 Total net position $ (967,289) $ (71,558) $ 549,551 $ 661,300 $ 172,004 31  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Discretely Presented Component Units Combining Statement of Changes in Net Position - Year Ended June 30, 2016 MCFA MDRA MIDA MIPFA Total REVENUES Charges for services $ 140,625 $ 157,983 $ 72,722 $ 42,466 $ 413,796 Total operating revenues 140,625 157,983 72,722 42,466 413,796 OPERATING EXPENSES Personal services - 118,139 - - 118,139 Materials and supplies 1,710 24,134 3,194 - 29,038 Other services and charges 49,793 186,335 9,108 16,161 261,397 Depreciation expense 177,793 2,526 20,727 19,681 220,727 Total operating expenses 229,296 331,134 33,029 35,842 629,301 Operating income (loss) (88,671) (173,151) 39,693 6,624 (215,505) NON-OPERATING REVENUES (EXPENSES) Investment income - - 1 215 216 Miscellaneous income 1,400 175,974 - - 177,374 Bond issuance cost - - - - - Interest expense and fiscal charges (224,755) (5,221) (20,031) - (250,007) Total non-operating revenue (expenses) (223,355) 170,753 (20,030) 215 (72,417) Change in net position (312,026) (2,398) 19,663 6,839 (287,922) Total net position - beginning (655,263) (69,160) 529,888 654,461 459,926 Total net position - ending $ (967,289) $ (71,558) $ 549,551 $ 661,300 $ 172,004 32  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 FOOTNOTES TO BASIC FINANCIAL STATEMENTS 33  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Footnotes to the Basic Financial Statements: 1. Financial Reporting Entity In determining the financial reporting entity, the City uses the integrated approach as prescribed by Governmental Accounting Standards Board Statements No. 14 “The Financial Reporting Entity”, and Statement No. 61, “The Financial Reporting Entity: Omnibus”, and includes all component units for which the City is financially accountable/fiscally responsible. The City’s financial reporting entity primary government presentation includes the City of Miami and the certain component units as follows: The City of Miami – that operates the public safety, health and welfare, streets and highways, culture and recreation, and administrative activities. The City of Miami is an incorporated municipality with a population of approximately 13,570 located in northeastern Oklahoma. The City operates under a council-manager form of government with a charter that provides for three branches of government:  Legislative – the governing body includes an elected five-member City Council and Mayor  Executive – the City Manager is the Chief Executive Officer and is appointed by the City Council  Judicial – the Municipal Judge is a practicing attorney appointed by the City Council Blended Component Units (separate legal entities for which the City Council is fiscally responsible, and for which the City Council members serve as the trustees/governing body of the entity): Miami Special Utility Authority (MSUA) – public trust that operates the electric, water, wastewater, and solid waste/sanitation services of the City. Miami Development Authority (MDA) – public trust created to promote the development of housing in Miami. Discretely Presented Component Units (separate legal entities for which the City Council is fiscally responsible, but appoints a separate governing body): Miami Education Facilities Authority (MEFA) – public trust that promotes the development of educational facilities within the city. Complete financial statements of the MEFA component unit can be obtained from: Board of Trustees, Miami Educational Facilities Authority, 2 N. Main, Suite 404, Miami, OK 74354. The trust is currently inactive. Miami Downtown Redevelopment Authority (MDRA) – public trust created to promote the redevelopment of the downtown area. The Authority does not issue separate financial statements. Miami Industrial and Public Facilities Authority (MIPFA) – public trust that promotes the use of facilities in the City of Miami area. The Authority does not issue separate financial statements. Miami Community Facilities Authority (MCFA) – public trust that promotes the development of commerce, housing, recreation, education and public facilities within the city. The Authority does not issue separate financial statements. 34  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Miami Industrial Development Authority (MIDA) – public trust that promotes industry in and around the City of Miami. Complete financial statements can be obtained from the office of the City Clerk. MIDA’s fiscal year end is July 31. Each of these component units listed above are Public Trusts established pursuant to Title 60 of Oklahoma State law. Public Trusts (Authorities) have no taxing power. The Authorities are generally created to finance City services through issuance of revenue bonds or other non-general obligation debt and to enable the City Council to delegate certain functions to the governing body (Trustees) of the Authority. In accordance with state law, the City Council must approve, by two-thirds vote, all debt obligations of these public trusts prior to incurring the obligation. The Authorities generally retain title to assets which are acquired or constructed with Authority debt or other Authority generated resources. In addition, the City has leased certain existing assets at the creation for the Authorities to the Trustees on a long-term basis. The City, as beneficiary of the Public Trusts, receives title to any residual assets when a Public Trust is dissolved. 2. Basis of Presentation and Accounting This annual report is presented in a format that substantially meets the presentation requirements of the Governmental Accounting Standards Board (GASB) in accordance with generally accepted accounting principles. The presentation includes financial statements that communicate the City’s financial condition and changes therein at two distinct levels:  The City as a Whole (a government-wide presentation)  The City’s Funds (a presentation of the City’s major and aggregate non-major funds) Government-Wide Financial Statements: In the Statement of Net Position and the Statement of Activities, we divide the City into three kinds of activities: Governmental activities - Most of the City’s basic services are reported here, including the police, fire, general administration, streets, parks and recreation. Sales taxes, franchise fees, fines, and state and federal grants finance most of these activities. Business-type activities – Services where the City charges a fee to customers to help it cover all or most of the cost of these services it provides. The City’s airport, water, sewer, electric and sanitation systems activities are reported here. Discretely presented component units -- Accounts for various activities related to economic development, facility management, facility construction, and downtown development. 35  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 The Statements of Net Position and Activities are reported on the accrual basis of accounting and economic resources measurement focus. Under the accrual basis of accounting, revenues are recognized when earned and expenses (including depreciation and amortization) are recorded when the liability is incurred or economic asset used. Fund Financial Statements: Governmental Funds: Most of the City’s basic services are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end that are available for spending. Governmental funds report their activities on the modified accrual basis of accounting and current financial resources measurement focus that is different from other funds. For example, these funds report the acquisition of capital assets and payments for debt principal as expenditures and not as changes to asset and debt balances. The governmental fund statements provide a detailed short-term view of the City’s general government operations and the basic services it provides. Governmental fund information helps you determine (through a review of changes to fund balance) whether there are more or fewer financial resources that can be spent in the near future to finance the City’s programs. The City’s governmental funds include: Major Funds:  General Fund – accounts for all activities not accounted for in other special-purpose funds. For reporting purposes the General Fund includes the activities of the Municipal Court Account, Drug & Safety Account, and Demolition Account. The General Fund’s major funding source is a three cent sales tax, franchise fees, hotel/motel tax, and miscellaneous charges for services.  G.O. Street Project Fund – is a capital project fund that accounts for a .65 cent sales tax restricted for streets and bond proceeds for street construction. Aggregated Non-Major Funds (reported as Other Governmental Funds): Special Revenue Funds include the Fishing License Fund, Street and Alley, Drug Forfeiture Fund, Summer Recreation Program, Grant Fund, RFC 07-09 Grant, MDA Housing Construction, Housing Infrastructure, Coleman Project, Police Grant, and Cemetery Perpetual Care Interest. Debt Service Funds – accounts for ad-valorem taxes levied by the City for use in retiring court-assessed judgments, general obligation bonds, and their related interest expenses. Capital Project Funds:  Pool Improvements Fund accounts for recreation fees used to rehabilitate the municipal pool.  Parks Department Projects accounts for general obligation bond proceeds used to acquire, construct, and equip city park and recreation facilities.  Main Street Project accounts for projects related to the revitalization of Main Street.  Capital Improvement Fund accounts for use tax used for city capital projects for various departments.  Cemetery Perpetual Care Fund accounts for cemetery fees that are restricted for capital improvements. The governmental funds are reported on the modified accrual basis of accounting. On the modified accrual basis of accounting, revenues are recorded when earned and measurable and available to pay 36  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 current financial obligations, while expenditures are recorded when incurred and normally due and payable from current financial resources. The City defines revenue availability as collected within 60 days of period end. The reconciliation of the governmental funds financial statements to the governmental activities presentation in the government-wide financial statements is the result of the use of the accrual basis of accounting and economic resources measurement focus at the government-wide level. Proprietary Funds: When the City charges customers for the services it provides, these services are generally reported in proprietary funds. Proprietary funds include enterprise funds and internal service funds. Enterprise funds are used to account for business-like activities provided to the general public. Internal service funds are used to account for business-like activities provided to other funds or departments of the City. Proprietary funds are reported on the accrual basis of accounting and economic resources measurement focus. For example, proprietary fund capital assets are capitalized and depreciated and principal payments on long-term debt are recorded as a reduction to the liability. The City’s proprietary funds include the following: Enterprise Funds Major Funds:  Miami Special Utility Authority (MUSA) that accounts for the activities of the public trust in providing water, sewer, electric, and sanitation/solid waste services to the public.  Airport Fund accounts for activities of the municipal airport. Internal Service Funds (combined for reporting purposes)  Group Insurance Fund that accounts for the cost of providing various group health and life insurance services to other funds and departments of the City.  Workers Compensation Fund that accounts for the cost of providing workers compensation insurance to the other funds and departments of the City.  Unemployment Compensation Reimbursement that accounts for the cost of providing unemployment benefits. 37  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 3. Cash and Cash Equivalents, Deposits and Investments Cash and cash equivalents includes all demand and savings accounts, certificates of deposit or short- term investments with an original maturity of three months or less, and money market investments. Trust account investments in open-ended mutual fund shares are also considered cash equivalents. Investments consist of long-term certificates of deposit, U.S. Treasury bonds and notes, U.S. agency securities, government money market funds, and common stock in the employee retirement fund only. Certificates of deposit are reported at cost, while the U.S. Treasury and agency securities and common stock are reported at fair value. Deposits and Investments Risks The City of Miami primary government and component units are governed by the deposit and investment limitations of state law and trust indentures. The deposits and investments held at June 30, 2016 by these entities are as follows: Maturities in Years Fair Credit On Less T ype Value Rating Demand T han One Demand deposits $ 12,205,428 N/A $ 12,205,428 $ - Cash on hand 2,346 N/A 2,346 - T ime deposits 3,490,897 N/A - 3,490,897 Money Market Funds 1,572,739 Not rated - 1,572,739 Sub-T otal $ 17,271,410 $ 12,207,774 $ 5,063,636 Re conciliation to Financial State ments: Cash and cash equivalents $ 13,780,513 Investments 3,490,897 $ 17,271,410 The City implemented GASB Statement No. 72, Fair Value Measurement and Application, during the fiscal year ended June 30, 2016, which among other things, established a hierarchy 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. The City has the following recurring fair value measurements as of June 30, 2016: • Money Market Mutual Funds of $1,572,739 valued using quoted market prices (Level 1 inputs). Custodial Credit Risk – Exposure to custodial credit risk related to deposits exists when the City holds deposits that are uninsured and uncollateralized; collateralized with securities held by the pledging financial institution, or by its trust department or agent but not in the City’s name; or collateralized without a written or approved collateral agreement. Exposure to custodial credit risk related to investments exists when the City holds investments that are uninsured and unregistered, with securities held by the counterparty or by its trust department or agent but not in the City’s name. 38  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 The City’s policy as it relates to custodial credit risk is to secure its uninsured deposits with collateral, valued at no more than market value, at least at a level of 102% of the uninsured deposits and accrued interest thereon. The City’s policy limits acceptable collateral to U.S. Treasury securities, federally insured obligations, or direct debt obligations of municipalities, counties, and school districts in Oklahoma. Also, as required by Federal 12 U.S.C.A., Section 1823(e), all financial institutions pledging collateral to the City must have a written collateral agreement approved by the board of directors or loan committee. At June 30, 2016, the City was not exposed to custodial credit risk. Component Unit: The bank deposit of the MDRA component unit of $30,180 at June 30, 2016 was fully insured by the F.D.I.C. The bank deposits of the MCFA component unit of $251,539 at June 30, 2016 was fully insured by the F.D.I.C. The bank deposits of the MIPFA component unit of $224,172 at June 30, 2016 was fully insured by the F.D.I.C. The bank deposits of the MIDA component unit of $183,790 at June 30, 2016 was fully insured by the F.D.I.C. Investment Credit Risk – The City’s investment policy limits investments, excluding retirement trust fund investments, to the following: a. Obligations of the U. S. Government, its agencies and instrumentalities; b. Collateralized or insured non-negotiable certificates of deposit or other evidences of deposit that are either insured or secured with acceptable collateral with an in-state financial institution, and fully insured deposits in out-of-state institutions; c. Insured or fully collateralized negotiable certificates of deposit; d. Repurchase agreements that have underlying collateral consisting of those items specified in paragraph a above; and e. Money market funds regulated by the SEC and in which investments consist of the investments mentioned in the previous paragraph a. Investment credit risk is the risk that an issuer or other counterpart to an investment will not fulfill its obligations. The City has no formal policy limiting investments based on credit rating, but discloses any such credit risk associated with their investments by reporting the credit quality ratings of investments in debt securities as determined by nationally recognized statistical rating organizations—rating agencies— as of the year end. Unless there is information to the contrary, obligations of the U.S. government or obligations explicitly guaranteed by the U.S. government are not considered to have credit risk and do not require disclosure of credit quality. Investment Interest Rate Risk – Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The City discloses its exposure to interest rate risk by disclosing the maturity dates of its various investments by date range. 39  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 As noted in the schedule of deposits and investments above, at June 30, 2016, the investments held by the City mature between 2016 through 2017. Concentration of Investment Credit Risk - Exposure to concentration of credit risk is considered to exist when investments in any one issuer represent a significant percent of total investments of the City (any over 5% are disclosed). Restricted Cash and Investments The amounts reported as restricted assets of the Enterprise Funds on the Statement of Net Position are comprised of amounts held by the MSUA Enterprise Fund in accounts for the Oklahoma Water Resources Board promissory notes, 2001 Utility Revenue Bond and other accounts with restricted uses. The restricted assets as of June 30, 2016 are as follows: Cash and cash equivalents: Cash Restircted for Refundable deposits $ 49,524 Restricted for Construction 334,133 Money Markets Restricted for Debt Service 378,113 $ 761,770 Cash and cash equivalents, noncurrent: Money Markets Restricted for Debt Service $ 434,327 Cash Restircted for Refundable deposits 1,195 $ 435,522 Investments: Refundable deposits $ 187,468 $ 187,468 4. Receivables Material receivables in the governmental fund types and the governmental activities include revenue accruals such as court fines and economic development loans. These are reported as Due From Other Governments. Non-exchange transactions collectible but not available are deferred in the fund financial statements. Allowances for uncollectible accounts receivable are based upon historical trends and the periodic aging of accounts receivable. Business-type activities and the proprietary type fund consist of revenues earned at year-end and not yet received. Billed and unbilled utility accounts receivable comprise the majority of these receivables. Allowances for uncollectible accounts receivable are based upon historical trends and the periodic aging of accounts receivable. 40  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Less: Allowance Net Accounts for Uncollectible Accounts Receivable Accounts Receivable Governmental Activities: T axes $ 909,288 $ - $ 909,288 Due from other governments 1,030 - 1,030 Court fines 317,682 (213,358) 104,324 Other 1,236,826 - 1,236,826 T otal Governmental Activities $ 2,464,826 $ (213,358) $ 2,251,468 Reconciliation to Statement of Net Position: Accounts receivable, net $ 151,383 Due from other governmental agencies 876,562 Other receivable 1,223,523 T otal $ 2,251,468 Business-T ype Activities: Utilities $ 5,018,389 $ (1,521,374) $ 3,497,015 5. Inventories Inventories are valued at average cost. Inventories in the proprietary funds relate to fuel at the airport and material and supplies for the water, wastewater and electric systems. The cost of proprietary funds inventories are recorded as expenses when consumed rather than when purchased. 6. Capital Assets and Depreciation Capital Assets: For the primary government and component units, capital assets are reported at actual or estimated historical cost, net of accumulated depreciation where applicable. Donated capital assets are reported at their fair value at date of donation. Estimated historical cost was used to value the majority of the capital assets acquired prior to June 30, 1992. The capitalization threshold is capital assets with a cost of $5,000 or more. For the year ended June 30, 2016, capital assets balances changed as follows: 41  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Balance at Balance at July 1, 2015 Additions Deductions June 30, 2016 PRIMARY GOVERNMENT: Governmental activities: Capital assets not being depreciated: Land $ 5,487,269 $ - $ - $ 5,487,269 Construction in progress 2,141,253 1,382,339 2,515,073 1,008,519 Total capital assets not being depreciated 7,628,522 1,382,339 2,515,073 6,495,788 Other capital assets: Buildings 19,899,989 - - 19,899,989 Infrastructure 42,023,489 2,842,465 - 44,865,954 M achinery, furniture and equipment 11,014,388 216,811 - 11,231,199 Total other capital assets at historical cost 72,937,866 3,059,276 - 75,997,142 Less accumulated depreciation for: Buildings 14,968,370 334,459 - 15,302,829 Infrastructure 30,326,970 825,288 - 31,152,258 M achinery, furniture and equipment 8,229,050 470,377 - 8,699,427 Total accumulated depreciation 53,524,390 1,630,124 - 55,154,514 Other capital assets, net 19,413,476 1,429,152 - 20,842,628 Governmental activities capital assets, net $ 27,041,998 $ 2,811,491 $ 2,515,073 $ 27,338,416 Balance at Balance at July 1, 2015 Additions Deductions June 30, 2016 Business-type activities: Capital assets not being depreciated: Land $ 750,530 $ - $ - $ 750,530 Construction in progress 3,263,321 656,123 3,374,394 545,050 Total capital assets not being depreciated 4,013,851 656,123 3,374,394 1,295,580 Other capital assets: Buildings and utility infrastructure 17,538,564 2,815,298 - 20,353,862 M achinery, furniture and equipment 13,672,013 211,712 - 13,883,725 Infrastructure 15,658,858 1,052,556 - 16,711,414 Total other capital assets at historical cost 46,869,435 4,079,566 - 50,949,001 Less accumulated depreciation for: Buildings and utility infrastructure 10,009,256 493,697 - 10,502,953 M achinery, furniture and equipment 9,871,500 672,575 10,544,075 Infrastructure 12,421,149 285,820 - 12,706,969 Total accumulated depreciation 32,301,905 1,452,092 - 33,753,997 Other capital assets, net 14,567,530 2,627,474 - 17,195,004 Business-type activities capital assets, net $ 18,581,381 $ 3,283,597 $ 3,374,394 $ 18,490,584 Depreciation: Depreciable capital assets are depreciated on a straight-line basis over their useful lives. The range of estimated lives by type of assets is as follows:  Buildings 25-50 years  Improvements other than buildings 20-50 years  Utility property and improvements 15-50 years  Infrastructure 15-50 years  Machinery, furniture, and equipment 3–10 years 42  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Depreciation of capital assets is included in total expenses and is charged or allocated to the activities primarily benefiting from the use of the specific asset. Depreciation expense has been allocated as follows: Governmental Activities: General Government $ 38,270 Public Safety 175,369 Streets 904,151 Culture and Recreation 453,390 Economic Development 58,944 Total $ 1,630,124 Business-Type Activities: Airport $ 213,242 Electric 502,425 Water 240,600 Wastewater 465,347 Sanitation 30,478 Total $ 1,452,092 Capital assets of the component units were: M IDA Balance at Balance at July 1, 2015 Additions Deductions June 30, 2016 MIDA - Discreetly Presented Component unit Capital assets not being depreciated: Land $ 103,517 $ - $ - $ 103,517 Total capital assets not being depreciated 103,517 - - 103,517 Other capital assets: Buildings and utility infrastructure 1,036,353 - - 1,036,353 Less accumulated depreciation for: Buildings and utility infrastructure 207,085 20,727 - 227,812 Other capital assets, net 829,268 (20,727) - 808,541 M IDA capital assets, net $ 932,785 $ (20,727) $ - $ 912,058 Balance at Balance at July 1, 2015 Additions Deductions June 30, 2016 MDRA - Discreetly Presented Component unit Other capital assets: Buildings 6,500 - - 6,500 M achinery, furniture and equipment 18,756 - - 18,756 Total other capital assets at historical cost 25,256 - - 25,256 Less accumulated depreciation for: Buildings 1,950 650 - 2,600 M achinery, furniture and equipment 5,628 1,876 7,504 Total accumulated depreciation 7,578 2,526 - 10,104 Other capital assets, net 17,678 (2,526) - 15,152 M DRA capital assets, net $ 17,678 $ (2,526) $ - $ 15,152 43  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Balance at Balance at July 1, 2015 Additions Deductions June 30, 2016 MIPFA - Discreetly Presented Component unit Capital assets not being depreciated: Land $ 144,429 $ - $ - $ 144,429 Total capital assets not being depreciated 144,429 - - 144,429 Other capital assets: Buildings 574,724 - - 574,724 M achinery, furniture and equipment 75,000 - - 75,000 Total other capital assets at historical cost 649,724 - - 649,724 Less accumulated depreciation for: Buildings 259,334 19,691 - 279,025 M achinery, furniture and equipment 75,000 - - 75,000 Total accumulated depreciation 334,334 19,691 - 354,025 Other capital assets, net 315,390 (19,691) - 295,699 M IPFA capital assets, net $ 459,819 $ (19,691) $ - $ 440,128 Balance at Balance at July 1, 2015 Additions Deductions June 30, 2016 MCFA - Discreetly Presented Component unit Construction in p rogress $ 8,528,830 $ 5,250 $ 8,534,080 $ - Total cap ital assets not being dep reciated 8,528,830 5,250 8,534,080 - Other capital assets: Buildings - 8,534,080 - 8,534,080 Less accumulated dep reciation for: Buildings - 177,793 - 177,793 Other capital assets, net - 8,356,287 - 8,356,287 M CFA cap ital assets, net $ 8,528,830 $ 8,361,537 $ 8,534,080 $ 8,356,287 7. Internal and Interfund Balances and Transfers Internal and Interfund Balances: The City’s policy is to eliminate interfund receivable and payables between funds in the Statement of Net Position to avoid the grossing up of balances. Only the residual balances due between governmental and business-type activities are reported as internal balances and then offset in the total column. 44  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Re ce ivable Fund Payable Fund Amount Nature of Inte rfund Balance General Fund * Insurance Fund 7,487 T o cover negative balance in pooled cash General Fund * Airport Fund * 1,313 Payroll reimbursement General Fund * MSUA * 86,495 Payroll reimbursement Street and Alley Capital Improvement Fund 36,574 Expense reimbursement Capital Improvement Fund General Fund * 6,657 Reclassification MSUA Airport Fund 392 Expense reimbursement MSUA * General Fund * 30,179 Expense reimbursement MSUA General Fund 30,128 Posting correction T otal $ 199,225 * Denotes major fund. Due From Due T o Net Internal Reconciliation to Fund Financial Statements: Other Funds Other Funds Balances Governmental Funds $ 138,526 $ (103,538) $ 34,988 Proprietary Funds 60,699 (88,200) (27,501) Internal Service Funds - (7,487) (7,487) T otal $ 199,225 $ (199,225) $ - Reconciliation to Statement of Net Position: Net Internal Balances $ (27,501) Internal Service Fund Activity reported in Business-type Activities 655,934 Net Internal Balance $ 628,433 Internal and Interfund Transfers: The City’s policy is to eliminate interfund transfers between funds in the Statement of Activities to avoid the grossing up of balances. Only the residual balances transferred between governmental and business-type activities are reported as internal transfers and then offset in the total column. Internal activities between funds and activities for the year ended June 30, 2016 were as follows: Transfe r In Transfer O ut Amount Nature of Inte rfund Transfer * General Fund * MSUA $ 8,013,828 Operating subsidy/pledged sales tax * General Fund * Street Project 1,130,020 Pledged sales tax Cemetery Perpetual Care Interest Cemetery Perpetual Care 4,023 A/B Closing of fund Street and alley * MSUA 1,000,000 A Operating subsidy Capital Improvement Fund * MSUA 44,992 A Debt Service payments Capital Improvement Fund * MSUA 432,676 A Operating subsidy Capital Improvement Fund * MSUA 180,847 A Capital project * MSUA Street Project 1,136,171 Pledged sales tax * MSUA Capital Improvement Fund 60,651 B Capital project * MSUA * General Fund 6,345,498 Operating subsidy/pledged sales tax $ 18,348,706 * Denotes Major Fund Subtotal non-major Govermental Funds transfers in $ 1,481,691 A Subtotal non-major Govermental Funds transfers out $ 64,674 B T ransfers to T ransfers from Net Re conciliation to fund financial statements: Other Funds Other Funds T ransfers Governmental Funds $ (7,721,039) $ 11,761,710 $ 4,040,671 Enterprise Funds (10,627,667) 6,406,149 (4,221,518) T otals $ (18,348,706) $ 18,167,859 $ (180,847) Re conciliation to Statement of Activitie s: Net T ransfers T ransfer of capital assets (4,221,518) T ransfer of assets from Governmental Activities to Business T ype Activities 180,847 T ransfer of assets from Business-type activites to Governmental activiteis (46,903) T ransfers - Internal Activity $ (4,087,574) 45  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 8. Long-Term Debt The City’s long term debt consists of revenue bonds and notes, capital lease obligations, accrued compensated absences and long-term deposits subject to refund. For the year ended June 30, 2016, the City’s long-term debt balances changed as follows: Primary Government: Balance Balance Due Within Type of Debt July 1, 2015 Additions Deductions June 30, 2016 One Year Governmental Activities: Revenue Bond Discount $ (64,453) $ - $ (6,187) $ (58,266) $ - Revenue Bonds 9,790,000 - 745,000 9,045,000 770,000 Capital Lease Obligations 1,258,792 - 312,024 946,768 263,761 Accrued Compensated Absences 595,451 - 10,266 585,185 58,518 Total Governmental Activities $ 11,579,790 $ - $ 1,061,103 $ 10,518,687 $ 1,092,279 Plus: Net OPEB obligation 362,834 - Net pension liability 6,731,660 - $ 17,613,181 $ 1,092,279 Reconcilation to Statement of Net Position: Due within one year $ 1,092,279 Due in more than one year 16,520,902 $ 17,613,181 Balance Balance Due Within Type of Debt July 1, 2015 Additions Deductions June 30, 2016 One Year Business-Type Activities: Notes Payable $ 5,887,061 $ - $ 580,995 $ 5,306,066 $ 589,628 Unamortized Bond Discount (9,476) - (1,477) (7,999) - Revenue Bonds 1,375,000 - 185,000 1,190,000 190,000 Capital Lease Obligations 763,325 - 223,838 539,487 187,906 Accrued Compensated Absences 176,063 6,828 - 182,891 18,289 Total Business-Type Activities $ 8,191,973 $ 6,828 $ 988,356 $ 7,210,445 $ 985,823 Plus: OPEB obligation 196,136 - Net pension obligation 2,502,464 - Refundable deposits 399,580 39,958 $ 10,308,625 $ 1,025,781 Reconcilation to Statement of Net Position: Due within one year $ 1,025,781 Due in more than one year 9,282,844 $ 10,308,625 Governmental activities long-term debt payable from property tax levies or other governmental revenues includes the following: Revenue Bond Payable – 2010 Sales Tax Revenue Bond for $12,455,000 with interest from 2.15% to 5.00% Debt service payments are due semi-annually through December 2026. Bonds are Secured with net revenues of the Special Utility Authority and a pledged sales tax. $9,045,000 46  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Current portion $770,000 Non-current portion 8,275,000 $9,045,000 Capital Lease Obligations: $109,380 capital lease obligation for the purchase of a 2013 loader, matures January 2018 with a stated interest rate of 2.79%. $36,220 $100,362 capital lease obligation for the purchase of a dump truck, matures March 2017 with a stated interest rate of 2.79%. 15,942 $86,689 capital lease obligation for the purchase of a boom mower, matures August 2018 with a stated interest rate of 3.77%. 28,123 $95,400 capital lease obligation for the purchase of a backhoe/loader, matures November 2016 with a stated interest rate of 3.24%. 8,516 $42,200 capital lease obligation for the purchase of a caterpillar drum roller, matures September 2016 with a stated interest rate of 3.24%. 2,257 $90,154 capital lease obligation for the purchase of a crowler/dozer, matures September 2021 with a stated interest rate of 3.81%. 51,539 $100,495 capital lease obligation for the purchase of a wheel loader, matures June 2017 with a stated interest rate of 4.45% 16,339 $993,730 capital lease obligation for the purchase of fire trucks, matures July 2020 with a stated interest rate of 5.00% 596,899 $220,000 capital lease obligation for the purchase of the a gradall excavator, matures January 2017 with a stated interest rate of 4.40% 21,026 $94,641 capital lease obligation for the purchase of 2014 police svu’s, matures December 23, 2016 With a stated interest rate of 1.80% 15,914 $158,325 capital lease obligation for the purchase of street sweeper, matures May 29, 2018 with a stated interest rate of 1.94%. 62,511 $113,194 capital lease obligation for the purchase of two Torro mowers, matures July 2020 with a stated interest rate of 2.15% 91,482 Total capital lease obligations $946,768 Current portion $263,761 Non-current portion 683,007 $946,768 Business-type activities long-term debt payable from net revenues generated by and taxes pledged to the City’s business-type activities include the following: 47  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Capital Lease Obligation: $127,450 capital lease obligation for the purchase of a sanitation truck, matures October 2016 with a stated interest rate of 3.24% $9,065 $209,365 capital lease obligation for the purchase of a bucket truck, matures October 2019 with a stated interest rate of 2.300% 141,913 $503,720 capital lease obligation for the purchase of a trash truck, matures July 2019 with a stated interest rate of 1.97% 316,435 $82,210 capital lease obligation for the purchase of a work truck, matures July 2019 with a stated interest rate of 2.13% 51,756 $115,100 capital lease obligation for the purchase of a digger derrick truck, matures April 2017 with a stated interest rate of 2.96%. 20,318 Total Capital Leases $539,487 Current portion $187,906 Non-current portion 351,581 $539,487 Revenue Bond Payable – 2011 SUA Revenue Bond for $1,915,000 with interest from 1.45% to 2.90% Debt service payments are due semi-annually through December 2021. Bonds are secured with net revenues of the Special Utility Authority. $1,190,000 Current portion $190,000 Non-current portion 1,000,000 $1,190,000 Notes Payable – Oklahoma Water Resources Board: Series 2003A for $1,760,000 with no interest charged; however, there is a .5% annual administrative fee. Debt service payments are due semi-annually through March, 2023. Notes are secured by the revenues of the Miami Special Utility Authority’s (the “Authority”), sanitary and pledged revenue of the Utility Fund for water and sewer. $660,000 Series 2003B for $3,020,000 with interest rate of 1.78% and .5% annual administrative fee. Debt service payments are due semi-annually through December 2023. Secured by revenues of the water, sewer, and garbage collection and disposal systems. 1,496,140 Series 2004A for $1,595,538 with no interest rate and .5% annual administrative fee. Debt service payments are due semi-annually through June 2024. Secured by revenues of the water, sewer, and garbage collection and disposal systems. 638,215 Series 2004B for $2,740,000 with interest rate of 1.78% and .5% annual administrative fee. Debt service payments are due semi-annually through June 2025. Secured by revenues of the water, sewer, and garbage collection and disposal systems. 1,373,860 48  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Series 2004C for $1,620,000 with interest rate of 3.0% and .5% annual administrative fee. Debt service payments are due semi-annually through October 2024. Secured by revenues of the water, sewer, and garbage collection and disposal systems. 838,941 Series 2005 for $563,000 with no interest and .5% annual administrative fee. Debt service payments are due semi-annually through September 2025. Secured by revenues of the water, sewer, and garbage collection and disposal systems. 298,910 Total Notes Payable – Oklahoma Water Resources Board $5,306,066 Current portion $589,628 Non-current portion 4,716,438 $5,306,066 Long-term debt service requirements to maturity are as follows: Governmental-Type Activities Revenue Bonds Payable Capital Leases Year Ending June 30, Principal Interest Principal Interest 2017 $ 770,000 $ 316,665 $ 263,761 $ 35,076 2018 785,000 297,213 178,024 27,145 2019 810,000 274,061 127,225 20,974 2020 845,000 247,141 131,654 15,317 2021 880,000 216,936 243,562 1,292 2022-2025 4,955,000 529,319 2,542 17 Total $ 9,045,000 $ 1,881,335 $ 946,768 $ 99,821 Business-Type Activities Notes Payable Revenue Bonds Payable Capital Leases Payable Year Ending June 30, Principal Interest Principal Interest Principal Interest 2017 $ 589,628 $ 140,211 $ 190,000 $ 25,460 $ 187,906 $ 6,804 2018 602,819 120,341 190,000 22,230 161,717 3,508 2019 630,255 100,182 195,000 18,473 164,976 1,010 2020 641,594 85,068 200,000 14,025 24,888 64 2021 658,023 68,507 205,000 8,857 - - 2022-2025 2,183,747 93,031 210,000 3,045 - - Total $ 5,306,066 $ 607,340 $ 1,190,000 $ 92,090 $ 539,487 $ 11,386 MDRA Debt: The MDRA issued the 2010 note payable to First National Bank of Miami, payable in one annual installment, with interest of 4.75%, maturity date of December 2014 $103,000 49  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Balance Balance Due Within Type of Debt July 1, 2015 Additions Deductions June 30, 2016 One Year Component Unit: MDRA notes payable $ 122,650 $ - $ 19,650 $ 103,000 $ 103,000 MCFA: The MCFA issued a bond anticipation note for $8,798,611 in May 2013. The note will mature on December 1, 2018 with a value of $9,870,000. During fiscal 2016 accreted interest added to the value of the note totaled $193,590. The note carries an accretion rate of 2.10%. The note is to be used for the purpose of constructing, equipping and improving a community center and stadium complex to be located on the Northeastern Oklahoma A&M College Campus. The note is an unsecured indebtedness. The MCFA issued a note payable for $403,000 in October 2014 for the purchase of a scoreboard at the football facility. The note matures in June 2019. Balance Balance Due Within Type of Debt July 1, 2015 Additions Deductions June 30, 2016 One Year Component Unit: MCFA Bond Anticipation Note $ 9,174,382 $ 193,590 $ - $ 9,367,972 $ 9,367,972 MCFA Bond Anticipation Note Discount (54,658) - 15,997 (38,661) (38,661) Note payable 321,929 77,610 244,319 80,474 $ 9,441,653 $ 193,590 $ 61,613 $ 9,573,630 $ 9,409,785 Component Unit - MCFA Bond Anticipation Note Note Payable Year Ending June 30, Principal Interest Principal Interest 2017 $ 9,367,972 $ - $ 80,474 $ 9,771 2018 - - 83,981 6,541 2019 - - 79,864 3,182 Total $ 9,367,972 $ - $ 244,319 $ 19,494 MIDA Debt: The MIDA issued the 2005 note payable to the Miami Area Economic Development Services, Inc, payable in monthly Installments of $3,300 with interest at 5.00% maturity date of February 1, 2020 $289,627 The MIDA issued the 2005 note payable to the Miami Area Economic Development Services, Inc, payable in monthly Installments of $1,918, with interest of 1.25%, maturity date of February 1, 2020 199,294 The MIDA issued the 2005 note payable to the Miami Area Economic Development Services, Inc,, payable in monthly Installments of $607, with interest of 4.00%, maturity date of February 1, 2020 55,745 Total debt outstanding – MIDA - current $544,666 50  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Balance Balance Due Within Type of Debt July 1, 2015 Additions Deductions June 30, 2016 One Year Component Unit: MIDA Note payable $ 594,383 $ - $ 49,717 $ 544,666 $ 51,478 Component Unit - MIDA Notes Payable Year Ending June 30, Principal Interest 2017 $ 51,478 $ 18,412 2018 53,261 16,629 2019 55,123 14,766 2020 384,804 7,794 Total $ 544,666 $ 57,601 Pledge of Future Revenues Utility Net Revenues Pledge - The City and Special Utility Authority have pledged net utility revenues of the water, electric and wastewater systems to repay the OWRB Series 2003 B, 2003 A, 2004 A, 2004 B, 2004C, and 2005 promissory notes payable. Proceeds from the notes provided financing for capital assets. The notes are payable from net utility revenues and are payable through 2025. The total principal and interest payable for the remainder of the life of these notes is $5,913,406. Net utility revenues received in the current year were $5,324,958. Debt service payments of $737,569 for the current fiscal year were 13.9% of pledged net utility revenues. Pledged Sales Tax – The City has pledged 3.65 cents (or 100%) of future sales tax revenues to repay $12,455,000 of Series 2010 SUA Sales Tax Revenue Bonds and $1,915,000 of the Series 2011 Revenue Bonds. Three cents of the sales tax was voted by the citizens for general operations and .65 cent is legally restricted by a vote of the citizens for street purposes. The 2010 Sales Tax Revenue Bonds are for the construction and improvements to streets. The 2011 Revenue bonds are for water improvements. The .65 sales tax is used to pay the debt service on the 2010 bonds and the three cents is sent back to the general fund if not needed for debt service. The bonds are payable from pledged sales tax and net utility revenues and are payable through 2026 and 2021, respectively. The total principal and interest payable for the remainder of the life of these bonds is $12,208,425. Pledged sales taxes received in the current year were $6,345,498. Net revenues and sales tax pledged during the year was $11,670,456. Debt service payments of $1,655,101 for the current fiscal year were 14.2% of the pledged revenue. 9. Net Position and Fund Balances Government-wide net position is displayed in three components: a. Net investment in capital assets - Consists of capital assets including restricted capital assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds, mortgages, notes, or other borrowings that are attributable to the acquisition, construction, or improvements of those assets. 51  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 b. Restricted net position - Consists of net position with constraints placed on the use either by 1) external groups such as creditors, grantors, contributors, or laws and regulations of other governments, or 2) law through constitutional provisions or enabling legislation. c. Unrestricted net position - All other net position that does not meet the definition of “restricted” or “net investment in capital assets.” It is the City’s policy to first use restricted net position prior to the use of unrestricted net position when an expense is incurred for purposes for which both restricted and unrestricted net position are available. At June 30, 2016 net position restricted by enabling legislation totaled $137,006. Fund Balance: Governmental fund equity is classified as fund balance. Fund balance is further classified as nonspendable, restricted, committed, assigned and unassigned. These classifications are defined as: a. Nonspendable – includes amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact. b. Restricted – consists of fund balance with constraints placed on the use of resources either by (1) external groups such as creditors, grantors, contributors, or laws or regulations of other governments, or (2) laws through constitutional provisions or enabling legislation. c. Committed – included amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the city’s highest level of decision-making authority. The City’s highest level of decision-making authority is made by ordinance. d. Assigned – includes amounts that are constrained by the city’s intent to be used for specific purposes but are neither restricted nor committed. Assignments of fund balance may be made by city council action or management decision (city manager) when the city council has delegated that authority. Assignments for revenues in other governmental funds are made through budgetary process. e. Unassigned – represents fund balance that has not been assigned to other funds and has not been restricted, committed, or assigned to specific purposes within the General Fund. The City’s policy for the use of fund balance amounts require that committed amounts would be reduced first followed by assigned amounts and then unassigned amounts when expenditures are incurred for purposes for which amounts in any of those unrestricted fund balance classifications could be used. The following table shows the fund balance classifications as shown on the Governmental Funds Balance Sheet: 52  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Major Capital Project Fund Other General 2010 Street Governmental Fund Bond Project Fund Total Fund Balance: Restricted For: Police operations - grants $ - $ - $ 3,385 $ 3,385 General obligation debt service - 463,047 87,988 551,035 Capital improvements - - 325,184 325,184 Street improvements - 612,605 - 612,605 Culture and rec programs 7,639 - 240,341 247,980 Economic development - - 97,911 97,911 Police - drug programs - - 5,114 5,114 Sub-total restricted 7,639 1,075,652 759,923 1,843,214 Committed for: Street operations - - 2,830,627 2,830,627 Assigned for: Capital improvements - - - Demolition 136,888 - 691,121 828,009 Culture and rec programs 13,772 - - 13,772 Supplement next year's budget 1,321,541 - - 1,321,541 Sub-total assigned 1,472,201 - 691,121 2,163,322 Unassigned: 43,293 - - 43,293 TOTAL FUND BALANCE $ 1,523,133 $ 1,075,652 $ 4,281,671 $ 6,880,456 11. Revenues Program Revenues: Program revenues within the statement of activities that are derived directly from each activity or from parties outside of the City’s taxpayers are reported as program revenues. The City has the following program revenues in each activity:  Public Safety – Fire, Police, Emergency Management, Court, Civil Defense, fire run charges, officer’s training charges for services, police sentinel charges for services, restricted operating grants, 911 revenue, court and restricted capital grants  Streets – Commercial vehicle and gasoline excise tax shared by the State  Culture and recreation –pool fees, library fees, fishing permits, softball fees, recreation fees operating and capital grants  General Government – license and permits, fines and forfeitures, cemetery revenue, impact fees, and operating grants  Economic Development – rents, operating grants All other governmental revenues are reported as general. All taxes are classified as general revenue even if restricted for a specific purpose. Sales Tax Revenue: Sales tax revenue represents a 3.65 cents tax on each dollar of taxable sales of which is collected by the Oklahoma Tax Commission and remitted to the City. The sales tax is deposited 3 cents in the general fund and .65 cents in the 2010 Street Bond Project Fund. The entire sales tax initially reported in the General Fund is then transferred to the MSUA per the bond indenture pledge then transferred back to the appropriate funds. The .65 cents is legally restricted for street purposes by a vote of the citizens. 53  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Property Tax Revenue: In accordance with state law, a municipality may only levy a property tax to retire general obligation debt approved by the voters and to pay judgments rendered against the City. The City’s property taxes are billed and collected by the County and remitted to the City. Property taxes levied by the City are billed and collected by the County Treasurer's Office and remitted to the City in the month following collection. Property taxes are levied normally in October and are due in equal installments on December 31 and March 31. Property taxes unpaid for the fiscal year are attached by an enforceable lien on property in the following October. For the year ended June 30, 2016, the City did not assess a property tax. Ad valorem collections related to delinquent taxes collected in the current year. 12. Risk Management The City is exposed to various risks of loss related to torts; theft of, damage to, or destruction of assets; errors and omissions; injuries to employees; employee health and life; and natural disasters. The City manages these various risks of loss as follows:  General Liability – Covered through purchased insurance  Physical Property – Covered through purchased insurance with a $35,000 deductible.  Workers’ Compensation – Workers’ compensation is covered through self-insurance using a third party processor to process claims. The City also has a stop-loss policy which covers individual claims in excess $400,000 for electric, police and firefighters and $350,000 for all other classes of employees per occurrence.  Employee’s Group Medical –Covered through self-insurance using a third party processor to process medical claims. The City uses the third party processor’s estimates to record group insurance claims payable. The City also has a stop-loss policy which covers individual claims in excess of $70,000.  Unemployment – the City is self-insured. Management believes the insurance coverage listed above is sufficient to preclude any significant uninsured losses to the City. Settled claims have not exceeded this insurance coverage in any of the past two fiscal years. Worker's Health Unemployment Compensation Care Fund Total Claim liability, June 30, 2014 $ 1,817,883 $ 82,740 $ 773 $ 1,901,396 Claims and changes in estimates (173,237) 1,689,513 16,205 1,532,481 Claims payments (681,521) (1,565,813) (11,324) (2,258,658) Claim liability, June 30, 2015 963,125 206,440 5,654 1,175,219 Claims and changes in estimates 578,902 2,086,774 7,466 2,673,142 Claims payments (175,687) (2,245,573) (12,811) (2,434,071) Claim liability, June 30, 2016 $ 1,366,340 $ 47,641 $ 309 $ 1,414,290 54  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 13. Retirement Plan Participation Oklahoma Municipal Retirement Plan (OkMRF) – Defined Benefit Plan A. Plan Description The City contributes to the OkMRF for all eligible employees except for those covered by the Police and Firefighter Pension Systems. The plan is an agent multiple employer - defined benefit plan administered by OkMRF. The OkMRF plan issues a separate financial report and can be obtained from OkMRF or from their website: www.okmrf.org/reports.html. Benefits are established or amended by the City Council in accordance with O.S. Title 11, Section 48-101-102. B. Summary of Significant Accounting Policies 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 City’s plan and additions to/deductions from the City’s fiduciary net position have been determined on the same basis as they are reported by OkMRF. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value based on published market prices. Detailed information about the OkMRF plans’ fiduciary net position is available in the separately issued OkMRF financial report. C. Eligibility Factors and Benefit Provisions As of 07/01/15 Provision OkMRF Plan a. Eligible to participate Full-time employees except police, firefighters and other employees who are covered under an approved system. b. Period Required to Vest 10 years of credited service c. Eligibility for Distribution -Normal retirement at age 65 with 10 years of service -Early retirement at age 55 with 10 years of service -Disability retirement upon disability with 10 years of service -Death benefit with 10 years of service for married employees d. Benefit Determination Base Final average salary - the average of the five highest consecutive annual salaries out of the last 10 calendar years of service e. Benefit Determination Methods: Normal Retirement -1.875% of final average salary multiplied by credited years of service 55  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Early Retirement -Actuarially reduced benefit based upon age, final average salary, and years of service at termination Disability Retirement -Same as normal retirement Death Benefit -50% of employees accrued benefit, but terminates upon spouse re-marriage Prior to 10 Years Service -No benefits f. Benefit Authorization -Benefits are established and amended by City Council adoption of an ordinance in accordance with O.S. Title, 11, Section 48-101-102 g. Form of Benefit Payments Normal form is a 60 months certain and life thereafter basis. Employee may elect, with City consent, option form based on actuarial equivalent. D. Employees Covered by Benefit Terms Active Employees 117 Deferred Vested Former Employees 5 Retirees or Retiree Beneficiaries 82 Total 204 E. Contribution Requirements The City Council has the authority to set and amend contribution rates by ordinance for the OkMRF defined benefit plan in accordance with O.S. Title 11, Section 48-102. The contribution rates for the current fiscal year have been made in accordance with an actuarially determined rate. The actuarially determined rate is 13.22% of covered payroll as of 7-1-15. For the year ended June 30, 2016, the City recognized $643,059 of employer contributions to the plan which equals the actuarially determined amount based on covered payroll of $4,849,681. Employees contribute 3.75% to the plan in accordance with the plan provisions adopted by the City Council. Employee contributions for fiscal 2016 were $181,865. F. Actuarial Assumptions Date of Last Actuarial Valuation July 1, 2015 a. Actuarial cost method Entry age normal b. Rate of Return on Investments and Discount Rate 7.75% c. Projected Salary Increase Varies between 7.42% and 4% based on age d. Post Retirement cost-of-Living Increase None 56  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 e. Inflation Rate 3% f. Mortality Table UP 1994, with projected mortality improvement g. Percent of married employees 100% h. Spouse age difference 3 years (female spouses younger) i. Turnover Select and ultimate rates Ultimate rates are age-related as shown Additional rates per thousand are added during the first 5 years: Year 1: 215 Year 2: 140 Year 3: 95 Year 4: 65 Year 5: 40 j. Date of last experience study September 2012 for fiscal years 2007 thru 2011 G. Discount Rate – The discount rate used to value benefits was the long-term expected rate of return on plan investments of 7.75% since the plan’s net fiduciary position is projected to be sufficient to make projected benefit payments. The City has adopted a funding method that is designed to fund all benefits payable to participants over the course of their working careers. Any differences between actual and expected experience are funded over a fixed period to ensure all funds necessary to pay benefits have been contributed to the trust before those benefits are payable. Thus, the sufficiency of pension plan assets was made without a separate projection of cash flows. The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan 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 (3.0%). Best estimates of arithmetic real rates of return for each major asset class included in the pension plan’s target asset allocation as of July 1, 2015 are summarized in the following table: 57  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Target Real Weighted Allocation Return Return Large cap stocks 25% 5.40% 1.35% S&P 500 Small/mid cap stocks 10% 7.50% 0.75% Russell 2500 Long/short equity 10% 6.10% 0.61% MSCI ACWI International stocks 20% 5.10% 1.02% MSCI EAFE Fixed income bonds 30% 2.60% 0.78% Barclay's Capital Aggregate Real estate 5% 4.80% 0.24% NCREIF Cash equivalents 0% 0.00% 0.00% 3 month Treasury TOTAL 100% Average Real Return 4.75% Inflation 3.00% Long-term expected return 7.75% H. Changes in Net Pension Liability – The total pension liability was determined based on an actuarial valuation performed as of July 1, 2015 which is also the measurement date. There were no changes in assumptions or changes in benefit terms that affected measurement of the total pension liability. There were also no changes between the measurement date of July 1, 2015 and the City’s report ending date of June 30, 2016, that would have had a significant impact on the net pension liability. The following table reports the components of changes in net pension liability: 58  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Increase (Decrease) Total Pension Plan Net Net Pension Liability Position Liability (a) (b) (a) - (b) Balances Beginning of Year $ 13,878,678 $ 9,519,259 $ 4,359,419 Changes for the Year: Service cost 308,701 - 308,701 Interest expense 1,037,326 - 1,037,326 Experience losses (gains) - 102,207 - 102,207 (amortized over avg remain svc period of actives & inactive) Changes of assumptions - - - Contributions--City - 618,748 (618,748) Contributions--members - 175,420 (175,420) Net investment income - 261,920 (261,920) Benefits paid (1,006,438) (1,006,438) - Plan administrative expenses - (19,533) 19,533 Net Changes 441,796 30,117 411,679 Balances End of Year $ 14,320,474 $ 9,549,376 $ 4,771,098 Sensitivity of the net pension liability to changes in the discount rate. The following presents the net pension liability of the City, calculated using the discount rate of 7.75 percent, as well as what the City’s net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.75 percent) or 1-percentage-point higher (8.75 percent) than the current rate: 1% Current 1% Decrease Discount Increase (6.75%) Rate (7.75%) (8.75%) Net Pension Liability $ 6,486,464 $ 4,711,098 $ 3,357,578 The City reported $474,894 in pension expense for the year ended June 30, 2016. At June 30, 2016, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Deferred Outflows Deferred Inflows of Resources of Resources Differences between expected and actual experience $ 83,245 $ - Net difference between projected and actual earnings on pension plan investments 310,835 484,363 Changes in proportion and differences between City contributions and proportionate share of contributions 135,027 135,027 City contributions subsequent to the measurement date 643,059 - Total $ 1,172,166 $ 619,390 The $643,059 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2017. Any other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: 59  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Ye ar e nde d June 30: 2017 $ (64,783) 2018 (64,783) 2019 (64,783) 2020 96,668 2021 7,398 $ (90,283) Oklahoma Firefighter’s Pension – Statewide Cost Sharing Plan Plan description - The City of Miami, as the employer, participates in the Firefighters Pension & Retirement—a cost-sharing multiple-employer defined benefit pension plan administered by the Oklahoma Firefighters Pension & Retirement System (FPRS). Title 11 of the Oklahoma State Statutes grants the authority to establish and amend the benefit terms to the FPRS. FPRS issues a publicly available financial report that can be obtained at www.ok.gov/fprs Summary Significant Accounting Policies - 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 Oklahoma Firefighters Pension & Retirement System (FPRS) and additions to/deductions from FPRS’s fiduciary net position have been determined on the same basis as they are reported by FPRS. 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. Benefits provided - FPRS provides retirement, disability, and death benefits to members of the plan. Benefits for members hired prior to November 1, 2013 are determined as 2.5 percent of the employee’s final average compensation times the employee’s years of service and have reached the age of 50 or have complete 20 years of service, whichever is later. For volunteer firefighters, the monthly pension benefit for normal retirement is $150.60 per month. Benefits vest with 10 years or more of service. Benefits for members hired after November 1, 2013 are determined as 2.5 percent of the employee’s final average compensation times the employee’s years of service and have reached the age of 50 or have complete 22 years of service, whichever is later. For volunteer firefighters, the monthly pension benefit for normal retirement is $165.66 per month. Benefits vest with 11 years or more of service. All firefighters are eligible for immediate disability benefits. For paid firefighters, the disability in-the-line-of-duty benefit for firefighters with less than 20 years of service is equal to 50% of final average monthly compensation, based on the most recent 30 months of service. For firefighters with over 20 years of service, a disability in-the-line- of-duty is calculated based on 2.5% of final average monthly compensation, based on the most recent 30 months, per year of service, with a maximum of 30 years of service. For disabilities not-in-the-line-of-duty, the benefit is limited to only those with less than 20 years of service and is 50% of final average monthly compensation, based on the most recent 60-month salary as opposed to 3 0 months. For volunteer firefighters, the not-in-line-of-duty disability is also limited to only those with less than 20 years of service and is $7.53 per year of service. For volunteer firefighters, the in-line-of-duty pension is $150.60 with less than 20 years of service, or $7.53 per year of service, with a maximum of 30 years. A $5,000 lump sum death benefit is payable to the qualified spouse or designated recipient upon the participant's death. The $5,000 death benefit does not apply to members electing the vested benefit. 60  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Contributions - The contributions requirements of the Plan are at an established rate determined by Oklahoma Statute and are not based on actuarial calculations. Employees are required to contribute 9% percent of their annual pay. Participating cities are required to contribute 14% of the employees’ annual pay. Contributions to the pension plan from the City were $162,264. The State of Oklahoma also made on-behalf contributions to FPRS in the amount of $398,704 this is reported as both a revenue and an expenditure in the General Fund Statement of Revenues, Expenditures, and Changes in Fund Balance. In the government-wide Statement of Activities, revenue is recognized for the state’s on-behalf contributions on an accrual basis of $382,236. These on-behalf payments did not meet the criteria of a special funding situation. Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions - At June 30, 2016, the City reported a liability of $4,446,809 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2015, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of July 1, 2015. The City’s proportion of the net pension liability was based on the City’s contributions received by the pension plan relative to the total contributions received by pension plan for all participating employers as of June 30, 2015. Based upon this information, the City’s proportion was .4190%. For the year ended June 30, 2016, the City recognized pension expense of $387,933. At June 30, 2016, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Deferred Outflows of Deferred Inflows of Resources Resources Differences between expected and actual experience $ 87,855 $ - Net difference between projected and actual earnings on pension plan investments 157,641 489,119 Changes in proportion and differences between City contributions and proportionate share of contributions 56,379 - City contributions during the measurement date - 2,202 City contributions subsequent to the measurement date 162,264 - Total $ 464,139 $ 491,321 The $162,264 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2016. 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: 2016 $ (92,659) 2017 (92,659) 2018 (92,659) 2019 70,380 2020 14,738 Thereafter 3,413 Total $ (189,446) 61  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Actuarial Assumptions-The total pension liability was determined by an actuarial valuation as of July 1, 2015, using the following actuarial assumptions, applied to all prior periods included in the measurement: Inflation: 3% Salary increases: 3.5% to 9.0% average, including inflation Investment rate of return: 7 .5% net of pension plan investment expense Mortality rates were based on the RP2000 combined healthy with blue collar adjustment as appropriate, with adjustments for generational mortality improvement using scale AA for healthy lives and no mortality improvement for disabled lives. The actuarial assumptions used in the July 1, 2015, valuation were based on the results of an actuarial experience study for the period July 1, 2007, to June 30, 2012. The long-term expected rate of return on pension plan investments was determined using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan 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. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan's target asset allocation as of June 30, 2015, are summarized in the following table: Target Long-Term Expected Asset Class Allocation Real Rate of Return Fixed income 20% 5.13% Domestic equity 37% 8.02% International equity 20% 9.94% Real estate 10% 7.47% Other assets 13% 6.25% Discount Rate-The discount rate used to measure the total pension liability was 7 .5%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current contribution rate and that contributions from employers will be made at contractually required rates, determined by State statutes. Projected cash flows also assume the State of Oklahoma will continue contributing 36% of the insurance premium, as established by statute. Based on these assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of the Net Pension Liability to Changes in the Discount Rate-The following presents the net pension liability of the employers calculated using the discount rate of 7 .5%, as well as what the Plan's net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.5%) or 1-percentage-point higher (8.5%) than the current rate: 1% Decrease Current Discount 1% Increase (6.5%) Rate (7.5%) (8.5%) Employers' net pension liability $ 5,773,720 $ 4,446,809 $ 3,333,930 62  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Pension plan fiduciary net position - Detailed information about the pension plan’s fiduciary net position is available in the separately issued financial report of the FPRS; which can be located at www.ok.gov/fprs . Oklahoma Police Pension – Statewide Cost Sharing Plan Plan description - The City of Miami, as the employer, participates in the Oklahoma Police Pension and Retirement Plan—a cost-sharing multiple-employer defined benefit pension plan administered by the Oklahoma Police Pension and Retirement System (OPPRS). Title 11 of the Oklahoma State Statutes, through the Oklahoma Legislature, grants the authority to establish and amend the benefit terms to the OPPRS. OPPRS issues a publicly available financial report that can be obtained at www.ok.gov/OPPRS Summary of significant accounting polices - 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 Oklahoma Firefighters Pension & Retirement System (OPPRS) and additions to/deductions from OPPRS’s fiduciary net position have been determined on the same basis as they are reported by OPPRS. 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. Benefits provided - OPPRS provides retirement, disability, and death benefits to members of the plan. The normal retirement date under the Plan is the date upon which the participant completes 20 years of credited service, regardless of age. Participants become vested upon completing 10 years of credited service as a contributing participant of the Plan. No vesting occurs prior to completing 10 years of credited service. Participants’ contributions are refundable, without interest, upon termination prior to normal retirement. Participants who have completed 10 years of credited service may elect a vested benefit in lieu of having their accumulated contributions refunded. If the vested benefit is elected, the participant is entitled to a monthly retirement benefit commencing on the date the participant reaches 50 years of age or the date the participant would have had 20 years of credited service had employment continued uninterrupted, whichever is later. Monthly retirement benefits are calculated at 2.5% of the final average salary (defined as the average paid base salary of the officer over the highest 30 consecutive months of the last 60 months of credited service) multiplied by the years of credited service, with a maximum of 30 years of credited service considered. Monthly benefits for participants due to permanent disability incurred in the line of duty are 2.5% of the participants’ final average salary multiplied by 20 years. This disability benefit is reduced by stated percentages for partial disability based on the percentage of impairment. After 10 years of credited service, participants who retire due to disability incurred from any cause are eligible for a monthly benefit based on 2.5% of their final average salary multiplied by the years of service. This disability benefit is also reduced by stated percentages for partial disability based on the percentage of impairment. Effective July 1, 1998, once a disability benefit is granted to a participant, that participant is no longer allowed to apply for an increase in the dollar amount of the benefit at a subsequent date. Survivor’s benefits are payable in full to the participant’s beneficiary upon the death of a retired participant. The beneficiary of any active participant killed in the line of duty is entitled to a pension benefit. Contributions - The contributions requirements of the Plan are at an established rate determine by Oklahoma Statute and are not based on actuarial calculations. Employees are required to contribute 8% percent of their annual pay. Participating cities are required to contribute 13% of the employees’ annual pay. Contributions to the pension plan from the City were $156,178. The State of Oklahoma also made on-behalf contributions to OPPRS in the amount of $157,143 this is reported as both a revenue and an expenditure in the General Fund Statement of Revenues, Expenditures, and Changes in Fund Balance. In the government-wide Statement of Activities, revenue is recognized for the state’s on-behalf contributions on an accrual basis of $141,144. These on-behalf payments did not meet the criteria of a special funding situation. 63  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions - At June 30, 2016, the City reported a liability of $16,217 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2015, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of July 1, 2015. The City’s proportion of the net pension liability was based on the City’s contributions received by the pension plan relative to the total contributions received by pension plan for all participating employers as of June 30, 2015. Based upon this information, the City’s proportion was .3977%. For the year ended June 30, 2016, the City recognized pension expense of $52,730. At June 30, 2016, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Deferred Outflows of Deferred Inflows of Resources Resources Differences between expected and actual experience $ - $ 89,669 Net difference between projected and actual earnings on pension plan investments 290,597 352,980 Changes in proportion and differences between City contributions and proportionate share of contributions - 36,219 City contributions during measurement date 1,901 City contributions subsequent to the measurement date 156,178 - Total $ 446,775 $ 480,769 The $156,178 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2017. 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: 2016 $ (74,256) 2017 (74,256) 2018 (74,256) 2019 45,521 2020 (12,925) Total $ (190,172) Actuarial Assumptions-The total pension liability was determined by an actuarial valuation as of July 1, 2015, using the following actuarial assumptions, applied to all prior periods included in the measurement: Inflation: 3% Salary increases: 4.5% to 17% average, including inflation Investment rate of return: 7 .5% net of pension plan investment expense Mortality rates: Active employees (pre-retirement) RP-2000 Blue Collar 64  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Healthy Combined table with age set back 4 years with fully generational improvement using Scale AA. Active employees (post-retirement) and nondisabled pensioners: RP-2000 Blue Collar Healthy Combined table with fully generational improvement using scale AA. Disabled pensioners: RP-2000 Blue Collar Healthy Combined table with age set forward 4 years with fully generational improvement using Scale AA. The actuarial assumptions used in the July 1, 2015, valuation were based on the results of an actuarial experience study for the period July 1, 2007, to June 30, 2012. The long-term expected rate of return on pension plan investments was determined using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan 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. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan's target asset allocation as of June 30, 2015, are summarized in the following table: Long-Term Expected Asset Class Real Rate of Return Fixed income 2.24% Domestic equity 4.87% International equity 7.68% Real estate 5.47% Private Equity 5.80% Commodities 2.96% The current allocation policy is that approximately 60% of assets in equity instruments, including public equity, long-short hedge, venture capital, and private equity strategies; approximately 25% of assets in fixed income to include investment grade bonds, high yield and non-dollar denominated bonds, convertible bonds, and low volatility hedge fund strategies; and 15% of assets in real assets to include real estate, commodities, and other strategies. Discount Rate-The discount rate used to measure the total pension liability was 7 .5%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current contribution rate and that contributions from employers will be made at contractually required rates, determined by State statutes. Projected cash flows also assume the State of Oklahoma will continue contributing 14% of the insurance premium, as established by statute. Based on these assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of the Net Pension Liability to Changes in the Discount Rate-The following presents the net pension liability of the employers calculated using the discount rate of 7 .5%, as well as what the Plan's net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.5%) or 1-percentage-point higher (8.5%) than the current rate: 65  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 1% Decrease Current Discount 1% Increase (-6.5%) Rate (7.5%) (-8.5%) Employers' net pension liability (asset) $ 974,417 $ 16,217 $ (791,613) Pension plan fiduciary net position - Detailed information about the pension plan’s fiduciary net position is available in the separately issued financial report of the OPPRS; which can be located at www.ok.gov/OPPRS . City of Miami 457 Deferred Compensation Plan (DC Plan) Plan Description – The City of Miami makes available to all full-time employees two Section 457 deferred compensation plans. The DC Plan was created in accordance with Section 457 of the Internal Revenue Code, and permits the employees to defer a portion of their salary until future years. The deferred compensation is not available to the employee until retirement, termination, death, or unforeseeable emergency. Employees may choose investments offered by International City/County Management Association (ICMA) or the DC Plan. Separate audited financial statements are not available. Funding Policy – DC Plan participants may contribute up to $15,000 of eligible compensation per year. During the year ended June 30, 2016, employees contributed $75,383 and the employer contributed $0 to the DC Plan. ICMA Retirement Deferred Compensation Plan In addition to the above plans, the City of Miami offers a retirement plan through ICMA which is funded 18% by the employer and zero percent by employee contributions. Employee and employer contributions to the plan for the year ended June 30, 2016, there were no contributions to the plan. Separate audited financial statements are not available. 14. Postemployment Healthcare Plan Plan Description. The City sponsors Medical, Rx, and Dental insurance to qualifying retirees and their dependents. Coverage is provided through fully-insured arrangements that collectively operate as a substantive single-employer defined benefit plan. Qualifying retirees are those employees who are eligible for immediate disability or retirement benefits under the Oklahoma Police Pension and Retirement System, Oklahoma Firefighter’s Pension and Retirement System, or the City of Miami Retirement Plan. Retirees may continue coverage with the City by paying the carrier premium rate. Coverage is available for each of the lifetimes of retirees and their spouses. Authority to establish and amend benefit provisions rest with the City Council. Retirees may continue coverage with the City by paying the premium rate. Benefits are paid from general operating assets of the City. Funding Policy. The contribution requirements of plan members and the City are established by the City Council. Annual health insurance premium amounts are established by the city council. The required contribution is based on projected pay-as-you-go financing requirements. For fiscal year 2016, the actuarially expected City contribution in the form of net age adjustment was $206,267 to the Plan. Plan members receiving benefits contributed zero of the total premiums, through their payment of the full determined premium in FY 2016. 66  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Annual OPEB Cost and Net OPEB Obligation. The City's annual other postemployment benefit (OPEB) cost (expense) is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period of thirty years. The following table shows the components of the City's annual OPEB cost the amount actually contributed to the plan, and changes in the City's net OPEB obligation to for the year ended June 30, 2016: Normal Cost $ 459,133 Interest on ARC 12,601 Amortization of Actuarial Accrued Liablity (AAL) (38,098) Annual OPEB cost (expense) 433,636 Employer Contributions (206,267) Increase in net OPEB obligation 227,369 Net OPEB obligation - beginning of year 331,601 Net OPEB obligation - end of year $ 558,970 The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for were as follows: Percentage of Annual OPEB Cost Fiscal Year Annual OPEB Cost Contributed Net OPEB Obligation 6/30/09 $105,076 37% $66,123 6/30/10 108,217 36% 135,639 6/30/11 84,160 30% 194,323 6/30/12 90,722 24% 262,933 6/30/13 90,722 26% 329,965 6/30/14 195,104 100% 330,783 6/30/15 195,104 100% 331,601 6/30/16 433,636 47.5% 558,970 Funded Status and Funding Progress. As of July 1, 2015, the most recent actuarial valuation date, the Plan was not funded. The actuarial accrued liability (AAL) for benefits was $2,718,703, and the actuarial value of assets was zero, resulting in an unfunded actuarial accrued liability (UAAL) of $2,718,703. The covered payroll (annual payroll of active employees covered by the plan) was $7.2 million, and the ratio of the UAAL to the covered payroll was 38 percent. Because the plan is a substantive plan there are no plan assets. Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents multiyear trend information about whether the 67  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. Actuarial Methods and Assumptions. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. In the July 1, 2015, actuarial valuation, the Projected Unit Credit actuarial cost method was used. The actuarial assumptions included a 4.75 percent investment rate of return (net of administrative expenses), which is a blended rate of the expected long-term investment returns on plan assets and on the employer's own investments calculated based on the funded level of the Plan at the valuation date, and an annual healthcare cost trend rate of 7 percent initially, reduced by decrements to an ultimate rate of 5 percent in 2015. The UAAL is being amortized over 30 years based on a level percent-of-pay open-period basis. The remaining amortization period at July 1, 2015, was twenty-six years. As of the date of this valuation, there are no plan assets. Retiree premiums are paid as they come due from general operating assets of the City. 15. Commitments and Contingencies Litigation The City is a party to various legal proceedings which normally occur in the course of governmental operations. The financial statements do not include accruals or provisions for loss contingencies that may result from these proceedings. State statutes provide for the levy of an ad valorem tax over a three-year period by a City Sinking Fund for the payment of any court assessed judgment rendered against the City. While the outcome of the above noted proceedings cannot be predicted, due to the insurance coverage maintained by the City and the State statute relating to judgments, the City feels that any settlement or judgment not covered by insurance would not have a material adverse effect on the financial condition of the City. Grant Programs The City of Miami participates in various federal or state grant/loan programs from year to year. In 2016, the City’s involvement in federal and state award programs is relatively material. The grant/loan programs are often subject to additional audits by agents of the granting or loaning agency, the purpose of which is to ensure compliance with the specific conditions of the grant or loan. The City has not been notified of any noncompliance with federal or state award requirements. Any liability for reimbursement which may arise as a result of these audits cannot be reasonably determined at this time, although it is believed the amount, if any, would not be material. 68  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 REQUIRED SUPPLEMENTARY INFORMATION 69  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Budgetary Comparison Schedules (Budgetary Basis) – Year Ended June 30, 2016 GENERAL FUND Actual Variance with Budgeted Amounts Amounts Final Budget Original Final (Budget basis) Positive (Negative) Beginning Budgetary Fund Balance: $ 1,547,738 $ 1,553,233 $ 1,657,630 $ 104,397 Resources (Inflows): Taxes and assessments 6,662,500 6,857,998 6,862,409 4,411 Fees, licenses and permits 69,550 69,830 57,813 (12,017) Charges for services 168,650 177,874 168,601 (9,273) Fines and forfeitures 215,000 215,000 221,773 6,773 Interest earned 11,000 11,000 14,506 3,506 M iscellaneous 16,000 34,644 162,603 127,959 Intergovernmental 96,699 121,999 163,525 41,526 Total Resources (Inflows) 7,239,399 7,488,345 7,651,230 162,885 Amounts available for appropriation 8,787,137 9,041,578 9,308,860 267,282 Charges to Appropriations (Outflows): General Government M uncipal Court 175,741 175,741 164,920 10,821 General Government 1,336,108 1,615,548 1,424,913 190,635 M CVB 391,633 427,962 432,916 (4,954) Community Development - Human Resources 364,530 344,118 341,450 2,668 Legal 216,661 217,269 215,958 1,311 Economic Development 113,588 113,588 106,619 6,969 Public Safety Police 2,716,102 2,336,316 2,102,019 234,297 Fire 1,944,952 1,944,952 1,862,106 82,846 Emergency M anagement 204,527 103,992 93,156 10,836 Police Communications - 392,936 391,889 1,047 Code Enforecement - 105,280 87,932 17,348 Risk M anagement - 90,434 86,282 4,152 Public Works and Streets Streets 722,771 722,771 676,590 46,181 Cemetery 298,438 320,614 310,337 10,277 M unicipal Building 336,258 336,258 265,277 70,981 Culture and Recreation Parks 483,086 589,284 466,842 122,442 Swimming Pool - 193,802 155,522 38,280 Library 502,038 524,512 489,198 35,314 Total Charges to Appropriations 9,806,433 10,555,377 9,673,926 881,451 Other financing sources (uses) Transfers from other funds 7,469,296 8,013,828 8,013,828 - Transfers to other funds (6,150,000) (6,345,498) (6,345,498) - Total other financing sources (uses) 1,319,296 1,668,330 1,668,330 - Ending Budgetary Fund Balance $ 300,000 $ 154,531 $ 1,303,264 $ 1,148,733 70  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Schedule Footnotes to Budgetary Comparison: 1. The budgetary comparison schedules and budgetary fund balance amounts are reported on a non- GAAP basis that report revenues on a cash basis, and expenditures in the period the invoice is received, except for payroll expenditures that are recorded when paid. In addition, obligations that are required to be funded from ending budgetary fund balances are subtracted from total ending budgetary fund balances to arrive at the unassigned budgetary fund balance. This presentation of unassigned fund balances on a budgetary basis is used to demonstrate compliance with Article 10, § 26 of the Oklahoma State Constitution. 2. The legal level of appropriation control is the department level within a fund. Transfers of appropriation within a fund require the approval of the City Manager. All supplemental appropriations require the approval of the City Council. Supplemental appropriations must be filed with the Office of the State Auditor and Inspector. 3. The budgetary basis differs from the modified accrual (GAAP) basis as shown in the schedule below: Fund Balance Net Change in Fund Balance July 1, 2015 Fund Balance June 30, 2016 Budget to GAAP Reconciliation: Fund Balance - GAAP Basis $2,024,618 ($501,485) $1,523,133 Increases (Decreases): Revenues: Receivable from other governments and entities (809,311) 10,894 (798,417) Accounts receivable (99,931) (17,696) (117,627) State on behalf pension payments (535,363) (20,484) (555,847) Combining accounts (220,154) 83,071 (137,083) Expenditures: Accrued payroll 188,796 34,968 223,764 Other expenditures 573,612 35,882 609,494 State on behalf pension payments 535,363 20,484 555,847 Fund Balance - Budgetary Basis $1,657,630 ($354,366) $1,303,264 71  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Pension Information Schedules of Required Supplementary Information SCHEDULE OF THE CITY OF MIAMI'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY OKLAHOMA FIREFIGHTERS PENSION & RETIREMENT SYSTEM Last 10 Fiscal Years* 2014 2015 City's proportion of the net pension liability 0.413176% 0.418954% City's proportionate share of the net pension liability $ 4,887,039 $ 4,446,809 City's covered-employee payroll $ 1,144,680 $ 1,159,023 City's proprotionate share of the net pension liability as a percentage of its covered-employee payroll 427% 384% Plan fiduciary net position as a percentage of the total pension liability 68.12% 68.27% *The amounts present for each fiscal year were determined as of 6/30 Notes to Schedule: Only the previous two fiscal years are presented because 10-year data is not yet available. SCHEDULE OF CITY CONTRIBUTIONS OKLAHOMA FIREFIGHTERS PENSION & RETIREMENT SYSTEM Last 10 Fiscal Years 2014 2015 Statutorially required contribution $ 160,255 $ 162,264 Contributions in relation to the statutorially required contribution 160,255 162,264 Contribution deficiency (excess) $ - $ - City's covered-employee payroll $ 1,144,680 $ 1,159,023 Contributions as a percentage of covered-employee payroll 14.00% 14.00% Notes to Schedule: Only the previous two fiscal years are presented because 10-year data is not yet available. 72  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Schedules of Required Supplementary Information SCHEDULE OF THE CITY OF MIAMI PORTIONATE SHARE OF THE NET PENSION LIABILITY (ASSET) OKLAHOMA POLICE PENSION & RETIREMENT SYSTEM Last 10 Fiscal Years* 2014 2015 City's proportion of the net pension liability (asset) 0.4416% 0.3977% City's proportionate share of the net pension liability (asset) $ (148,685) $ 16,217 City's covered-employee payroll $ 1,131,472 $ 1,201,369 City's proprotionate share of the net pension liability (asset) as a percentage of its covered-employee payroll 13.14% 1.35% Plan fiduciary net position as a percentage of the total pension liability (asset) 101.53% 99.82% *The amounts present for each fiscal year were determined as of 6/30 Notes to Schedule: Only the previous two fiscal years are presented because 10-year data is not yet available. SCHEDULE OF CITY CONTRIBUTIONS OKLAHOMA POLICE PENSION & RETIREMENT SYSTEM Last 10 Fiscal Years 2014 2015 Statutorially required contribution $ 145,903 $ 156,178 Contributions in relation to the statutorially required contribution 145,903 156,178 Contribution deficiency (excess) $ - $ - City's covered-employee payroll $ 1,131,472 $ 1,201,369 Contributions as a percentage of covered-employee payroll 12.89% 13.00% Note s to Schedule: Only the previous two fiscal years are presented because 10-year data is not yet available. 73  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Required Supplementary Information Oklahoma Municipal Retirement Fund Schedule of Changes in Net Pension Liability and Related Ratios Last Fiscal Year 2014 2015 Total pension liability Service cost $ 276,403 $ 308,701 Interest 1,034,763 1,037,326 Changes of benefit terms - Differences between expected and actual experience - 102,207 Changes of assumptions - Benefit payments, including refunds of member contributions (997,138) (1,006,438) Net change in total pension liability 314,028 441,796 Total pension liability - beginning 13,564,650 13,878,678 Total pension liability - ending (a) $ 13,878,678 $ 14,320,474 Plan fiduciary net position Contributions - employer $ 569,542 $ 618,748 Contributions - member 166,578 175,420 Net investment income 1,363,071 261,920 Benefit payments, including refunds of member contributions (997,138) (1,006,438) Administrative expense (20,151) (19,533) Other - - Net change in plan fiduciary net position 1,081,902 30,117 Plan fiduciary net position - beginning 8,437,357 9,519,259 Plan fiduciary net position - ending (b) $ 9,519,259 $ 9,549,376 Net pension liability - ending (a) - (b) $ 4,359,419 $ 4,771,098 Plan fiduciary net position as a percentage of the total pension liability 68.59% 66.68% Covered employee payroll $ 4,461,027 $ 4,742,831 Net pension liability as a percentage of covered- 97.72% 100.60% employee payroll *The amounts present for each fiscal year were determined as of 6/30 Notes to Schedule: Only the previous two fiscal years are presented because 10-year data is not yet available. 74  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Required Supplementary Information Oklahoma Municipal Retirement Fund Schedule of Employer Contributions Last Fiscal Year 2014 2015 Actuarially determined contribution $ 616,160 $ 643,059 Contributions in relation to the actuarially 616,160 643,059 determined contribution Contribution deficiency (excess) $ - $ - Covered employee payroll $ 4,661,027 $ 4,849,681 Contributions as a percentage of covered-employee payroll 13.22% 13.26% Notes to Schedule: 1. Only the previous two fiscal years are presented because 10-year data is not yet available. 2. Latest Valuation Date: July 1, 2015 3. Actuarially determined contribution rate is calculated as of July 1, 2015 July 2015 through June 2016 contributions were at a rate of 13.26%. 4. Methods and assumptions used to determine contribution rates: Actuarial cost method - Entry age normal Amortization method - Level percent of payroll, closed Remaining amortization period - 29 years Asset valuation method - Actuarial: Smoothing period - 4 years Recognition method - Non-asymptotic Corridor - 70% - 130% Salary increases - 4.00% to 7.42% (varies by attained age) Investment rate of return - 7.50% 75  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Required Supplementary Information – OPEB The funded status and funding progress of the City’s defined benefit OPEB plan for the most recent actuarial valuations is as follows: July 1, 2009 July 1, 2010 July 1, 2012 July 1, 2014 July 1, 2015 Actuarial accrued liability - AAL (a) $ 785,142 $ 723,628 $ 782,605 $ 1,632,033 $ 2,718,703 Actuarial value of plan assets (b) - - - - - Unfunded actuarial accrued liability - UAAL (funding excess) (a) - (b) $ 785,142 $ 723,628 $ 782,605 $ 1,632,033 $ 2,718,703 Funded ratio (b)/(a) 0% 0% 0% 0% 0% Covered payroll (c) $ 6,900,000 $ 6,446,000 $ 7,134,999 $ 6,741,735 $ 7,200,000 UAAL (funding excess) as a % of covered payroll [UAAL/ (c)] 12% 11% 11% 24% 38% 76  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 OTHER SUPPLEMENTARY INFORMATION 77  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Balance Sheet – General Fund Accounts - June 30, 2016 Municipal Court General Fund Account Demolition Account Total General Fund ASSETS Cash and cash equivalents $ 971,556 $ 20,929 $ 137,786 $ 1,130,271 Investments 18,417 - - 18,417 Receivables: Accounts receivable 117,627 - - 117,627 Due from other funds 95,295 - - 95,295 Due from other accounts 10,838 - - 10,838 Receivable from other governments 673,122 - 1,030 674,152 Total assets $ 1,886,855 $ 20,929 $ 138,816 $ 2,046,600 LIABILITIES, DEFERRED INFLOWS AND FUND BALANCES Liabilities: Accounts payable and accrued liabilities $ 120,338 $ 9,896 $ 1,928 $ 132,162 Wages payable 223,764 - - 223,764 Due to other funds 66,964 - - 66,964 Due to other accounts - 10,838 - 10,838 Total liabilities 411,066 20,734 1,928 433,728 DEFERRED INFLOWS OF RESOURCES Deferred revenue 89,739 - - 89,739 Fund balances: Restricted 7,639 - - 7,639 Assigned 1,335,313 - 136,888 1,472,201 Unassigned 43,098 195 - 43,293 Total fund balances 1,386,050 195 136,888 1,523,133 Total liabilities, deferred inflows and fund balances $ 1,886,855 $ 20,929 $ 138,816 $ 2,046,600 78  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance – General Fund Accounts – Year Ended June 30, 2016 Municipal Demolition Total General General Fund Court Account Account Fund REVENUES Taxes $ 5,578,456 $ - $ - $ 5,578,456 Intergovernmental 765,478 - - 765,478 Charges for services 218,751 - - 218,751 Fines and forfeitures 220,755 - 5,041 225,796 Licenses and permits 59,580 - 5,748 65,328 Investment income 14,679 - - 14,679 Miscellaneous 188,802 - - 188,802 Total revenues 7,046,501 - 10,789 7,057,290 EXPENDITURES Current: General government 2,233,238 - 93,860 2,327,098 Public safety 5,066,228 - - 5,066,228 Public works and streets 1,233,102 - - 1,233,102 Culture and recreation 1,086,491 - - 1,086,491 Economic development 433,370 - - 433,370 Capital Outlay 7,488 - - 7,488 Debt Service: Principal 166,593 - - 166,593 Interest and fiscal charges 36,755 - - 36,755 Total expenditures 10,263,265 - 93,860 10,357,125 Excess (deficiency) of revenues over expenditures (3,216,764) - (83,071) (3,299,835) OTHER FINANCING SOURCES (USES) Transfers in 9,143,848 - - 9,143,848 Transfers out (6,345,498) - - (6,345,498) Total other financing sources and uses 2,798,350 - - 2,798,350 Net change in fund balances (418,414) - (83,071) (501,485) Fund balances - beginning 1,804,464 195 219,959 2,024,618 Fund balances - ending $ 1,386,050 $ 195 $ 136,888 $ 1,523,133 79  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Balance Sheet - Non-Major Governmental Funds - June 30, 2016 SPECIAL REVENUE FUNDS FISHING STREET AND DRUG FORFEITURE SUMMER RECREATION LICENSE FUND ALLEY FUND PROGRAM GRANT FUND ASSETS Cash and cash equivalents $ 51,792 $ 2,963,562 $ 5,114 $ 160,449 $ 9,755 Accounts receivable - - - - - Due from other governments - 10,415 - - - Due from other funds - 36,574 - - - Total assets $ 51,792 $ 3,010,551 $ 5,114 $ 160,449 $ 9,755 LIABILITIES, DEFERRED INFLOWS AND FUND BALANCES Liabilities: Accounts payable and accrued liabilities $ - $ 179,924 $ - $ 11,571 $ 253 Wages payable - - - 11,872 - Due to other funds - - - - - Total liabilities - 179,924 - 23,443 253 Deferred Inflows: Deferred revenue - - - - - Fund balances: Restricted 51,792 - 5,114 137,006 9,502 Commited - 2,830,627 - - - Assigned - - - - - Total fund balances 51,792 2,830,627 5,114 137,006 9,502 Total liabilities, deferred inflows and fund balances $ 51,792 $ 3,010,551 $ 5,114 $ 160,449 $ 9,755 (continued) 80  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Balance Sheet - Non-Major Governmental Funds - June 30, 2016, Continued SPECIAL REVENUE FUNDS RFC 07-09 MDA-HOUSING HOUSING COLEMAN POLICE GRANT FUND CONSTRUCTION FUND INFRASTRUCTURE FUND PROJECT GRANTS ASSETS Cash and cash equivalents $ 11,045 $ 91,716 $ - $ 18,850 $ 3,385 Accounts receivable - - - - - Due from other governments - - - - - Due from other funds - - - - - Total assets $ 11,045 $ 91,716 $ - $ 18,850 $ 3,385 LIABILITIES, DEFERRED INFLOWS AND FUND BALANCES Liabilities: Accounts payable and accrued liabilities $ 4,850 $ - $ - $ - $ - Wages payable - - - - - Due to other funds - - - - - Total liabilities 4,850 - - - - Deferred Inflows: Deferred revenue - - - - - Fund balances: Restricted 6,195 91,716 - 18,850 3,385 Commited - - - - - Assigned - - - - - Total fund balances 6,195 91,716 - 18,850 3,385 Total liabilities, deferred inflows and fund balances $ 11,045 $ 91,716 $ - $ 18,850 $ 3,385 81  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Balance Sheet - Non-Major Governmental Funds - June 30, 2016, Continued SPECIAL REVENUE DEBT SERVICE FUNDS FUND CAPITAL PROJECT FUNDS CEMETERY CEMETERY PERPETUAL CARE G.O. BOND PERPETUAL MAIN STREET CAPITAL INTEREST SINKING FUND CARE PROJECT IMPROVEMENT FUND ASSETS Cash and cash equivalents $ - $ 87,988 $ 145,285 $ 67,776 $ 1,070,065 Accounts receivable - - - - 33,756 Due from other governments - 55,410 - - - Due from other funds - - - - 6,657 Total assets $ - $ 143,398 $ 145,285 $ 67,776 $ 1,110,478 LIABILITIES, DEFERRED INFLOWS AND FUND BALANCES Liabilities: Accounts payable and accrued liabilities $ - $ - $ - $ - $ 382,783 Wages payable - - - - - Due to other funds - - - - 36,574 Total liabilities - - - - 419,357 Deferred Inflows: Deferred revenue - 55,410 - - - Fund balances: Restricted - 87,988 145,285 67,776 - Commited - - - - - Assigned - - - - 691,121 Total fund balances - 87,988 145,285 67,776 691,121 Total liabilities, deferred inflows and fund balances $ - $ 143,398 $ 145,285 $ 67,776 $ 1,110,478 82  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Balance Sheet - Non-Major Governmental Funds - June 30, 2016, Continued CAPITAL PROJECT FUNDS PARK POOL DEPARTMENT IMPROVEMENT FUND PROJECTS TOTALS ASSETS Cash and cash equivalents $ 93,273 $ 42,041 $ 4,822,096 Accounts receivable - - 33,756 Due from other governments - - 65,825 Due from other funds - - 43,231 Total assets $ 93,273 $ 42,041 $ 4,964,908 LIABILITIES, DEFERRED INFLOWS AND FUND BALANCES Liabilities: Accounts payable and accrued liabilities $ - $ - $ 579,381 Wages payable - - 11,872 Due to other funds - - 36,574 Total liabilities - - 627,827 Deferred Inflows: Deferred revenue - - 55,410 Fund balances: Restricted 93,273 42,041 759,923 Commited - - 2,830,627 Assigned - - 691,121 Total fund balances 93,273 42,041 4,281,671 Total liabilities, deferred inflows and fund balances $ 93,273 $ 42,041 $ 4,964,908 83  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance – Nonmajor Governmental Funds – Year Ended June 30, 2016 SPECIAL REVENUE FUNDS SUMMER FISHING STREET AND DRUG FORFEITURE RECREATION LICENSE FUND ALLEY FUND PROGRAM GRANT FUND REVENUES Taxes $ - $ - $ - $ - $ - Intergovernmental 5,000 125,521 - - 16,500 Charges for services - - - 55,194 - Investment income - - - - - Miscellaneous - 20,216 2,367 - 10,648 Total revenues 5,000 145,737 2,367 55,194 27,148 EXPENDITURES Current: General government - - - - - Public safety - - 920 - - Public works - 215,955 - - - Culture and recreation 8,760 - - 47,181 17,646 Capital Outlay - 330,294 - - - Debt Service Principal retirement - 102,567 - - - Interest and fiscal charges - 6,841 - - - Total Expenditures 8,760 655,657 920 47,181 17,646 Revenues over (under) expenditures (3,760) (509,920) 1,447 8,013 9,502 OTHER FINANCING SOURCES (USES) Transfers in - 1,000,000 - - - Transfers out - - - - - Total other financing sources (uses) - 1,000,000 - - - Net change in fund balances (3,760) 490,080 1,447 8,013 9,502 Fund balances - beginning 55,552 2,340,547 3,667 128,993 - Fund balances - ending $ 51,792 $ 2,830,627 $ 5,114 $ 137,006 $ 9,502 (continued) 84  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance – Nonmajor Governmental Funds – Year Ended June 30, 2016, Continued SPECIAL REVENUE FUNDS MDA-HOUSING RFC 07-09 CONSTRUCTION HOUSING COLEMAN POLICE GRANT FUND FUND INFRASTRUCTURE FUND PROJECT GRANTS REVENUES Taxes $ - $ - $ - $ - $ - Intergovernmental - 41,421 - - - Charges for services - - - - - Investment earnings - - - - - Miscellaneous 5,607 - - - - Total revenues 5,607 41,421 - - - EXPENDITURES Current: General government - 1,768 - - - Public safety 17,105 - - - - Public works - - - - - Culture and recreation - - - - - Capital Outlay - 28,155 8,345 - - Debt Service Principal retirement - - - - - Interest and fiscal charges - - - - - Total Expenditures 17,105 29,923 8,345 - - Excess (deficiency) of revenues over expenditures (11,498) 11,498 (8,345) - - OTHER FINANCING SOURCES (USES) Transfers in - - - - - Transfers out - - - - - Total other financing sources and uses - - - - - Net change in fund balances (11,498) 11,498 (8,345) - - Fund balances - beginning 17,693 80,218 8,345 18,850 3,385 Fund balances - ending $ 6,195 $ 91,716 $ - $ 18,850 $ 3,385 (continued) 85  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance – Nonmajor Governmental Funds – Year Ended June 30, 2016, Continued SPECIAL DEBT SERVICE REVENUE FUNDS FUND CAPITAL PROJECT FUNDS CEMETERY CEMETERY CAPITAL PERPETUAL G.O. BOND PERPETUAL MAIN STREET IMPROVEMENT CARE INTEREST SINKING FUND CARE PROJECT FUND REVENUES Taxes $ - $ 18,517 $ - $ - $ 347,805 Intergovernmental - - - 22,484 - Charges for services - - 9,313 - - Investment earnings - - - - 288 Miscellaneous - 2,472 - - 31,986 Total revenues - 20,989 9,313 22,484 380,079 EXPENDITURES Current: General government - - - - - Public safety - - - - - Public works - - - - - Culture and recreation - - - - - Capital Outlay - - - - 1,064,086 Debt Service Principal retirement - - - - 42,864 Interest and fiscal charges - 899 - - 2,128 Total Expenditures - 899 - - 1,109,078 Excess (deficiency) of revenues over expenditures - 20,090 9,313 22,484 (728,999) OTHER FINANCING SOURCES (USES) Transfers in 4,023 - - - 477,668 Transfers out - - (4,023) - (241,498) Total other financing sources and uses 4,023 - (4,023) - 236,170 Net change in fund balances 4,023 20,090 5,290 22,484 (492,829) Fund balances - beginning (4,023) 67,898 139,995 45,292 1,183,950 Fund balances - ending $ - $ 87,988 $ 145,285 $ 67,776 $ 691,121 (continued) 86  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance – Nonmajor Governmental Funds – Year Ended June 30, 2016, Continued CAPITAL PROJECT FUNDS POOL PARK IMPROVEMENT DEPARTMENT FUND PROJECTS TOTALS REVENUES Taxes $ - $ - $ 366,322 Intergovernmental - - 210,926 Charges for services 62,240 - 126,747 Investment earnings - - 288 Miscellaneous - - 73,296 Total revenues 62,240 - 777,579 EXPENDITURES Current: General government - - 1,768 Public safety - - 18,025 Public works - - 215,955 Culture and recreation - - 73,587 Capital Outlay 49,000 - 1,479,880 Debt Service Principal retirement - - 145,431 Interest and fiscal charges - - 9,868 Total Expenditures 49,000 - 1,944,514 Excess (deficiency) of revenues over expenditures 13,240 - (1,166,935) OTHER FINANCING SOURCES (USES) Transfers in - - 1,481,691 Transfers out - - (245,521) Total other financing sources and uses - - 1,236,170 Net change in fund balances 13,240 - 69,235 Fund balances - beginning 80,033 42,041 4,212,436 Fund balances - ending $ 93,273 $ 42,041 $ 4,281,671 87  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Schedule of Net Position – Special Utility Authority Accounts – June 30, 2016 Miami Special Utility Authority Accounts Utility Improvement Stormwater Rainy Day Public Utilities Account Account Account Total ASSETS Current assets: Cash and cash equivalents $ 727,044 $ - $ 95,846 $ 3,635,663 $ 4,458,553 Cash and cash equivalents, restricted 314,551 447,219 - - 761,770 Investments - - - 2,668,606 2,668,606 Accounts receivable, net 3,460,653 - - - 3,460,653 Other receivable 436 - - - 436 Accrued interest receivable 809 - - - 809 Inventory 927,789 - - - 927,789 Due from other accounts 31,992 - - - 31,992 Due from other funds 30,571 - - - 30,571 Total current assets 5,493,845 447,219 95,846 6,304,269 12,341,179 Non-current assets: Cash and cash equivalents, restricted 435,522 - - - 435,522 Investments, restricted 187,468 - - - 187,468 Capital assets: Land, construction in progress, and water rights 1,277,719 - - - 1,277,719 Other capital assets, net of accumulated depreciation 13,686,926 - - - 13,686,926 Total non-current assets 15,587,635 - - - 15,587,635 Total assets 21,081,480 447,219 95,846 6,304,269 27,928,814 DEFERRED OUTFLOW OF RESOURCES Deferred amounts related to pension 646,690 - - - 646,690 LIABILITIES Current liabilities: Accounts payable and accrued liabilities 1,489,178 51,398 - - 1,540,576 Wages payable 128,656 - - - 128,656 Due to other accounts - - 31,992 - 31,992 Due to other funds 86,495 - - - 86,495 Accrued interest payable 41,818 - - - 41,818 Accrued compensated absences 18,289 - - - 18,289 Refundable deposits 39,958 - - - 39,958 Capital lease payable 187,906 - - - 187,906 Revenue bond payable - 190,000 - - 190,000 Notes payable 589,628 - - - 589,628 Total current liabilities 2,581,928 241,398 31,992 - 2,855,318 Non-current liabilities: Accrued compensated absences 164,603 - - - 164,603 Net pension liability 2,455,775 - - - 2,455,775 Net OPEB obligation 196,136 - - - 196,136 Refundable deposits 359,622 - - - 359,622 Capital lease payable 351,580 - - - 351,580 Revenue bond payable - 992,002 - - 992,002 Notes payable, net 4,716,437 - - - 4,716,437 Total non-current liabilities 8,244,153 992,002 - - 9,236,155 Total liabilities 10,826,081 1,233,400 31,992 - 12,091,473 DEFERRED INFLOW OF RESOURCES Deferred amounts related to pensions 249,311 - - - 249,311 NET POSITION Net investment in capital assets 9,119,095 (1,182,002) - - 7,937,093 Restricted for debt service 657,536 113,086 - - 770,622 Unrestricted 876,147 282,735 63,854 6,304,269 7,527,005 Total net position $ 10,652,778 $ (786,181) $ 63,854 $ 6,304,269 $ 16,234,720 88  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Schedule of Revenues, Expenses and Changes in Net Position – Special Utility Authority Accounts - Year Ended June 30, 2016 Miami Special Utility Authority Accounts Utility Improvement Stormwater Rainy Day Public Utilities Account Account Account Total REVENUES Charges for services $ 22,396,293 $ - $ - $ - $ 22,396,293 Fees, licenses and permits - - 135,562 - 135,562 Miscellaneous 765,917 - - - 765,917 Total operating revenues 23,162,210 - 135,562 - 23,297,772 OPERATING EXPENSES Personal services 3,856,774 - 33,150 - 3,889,924 Materials and supplies 10,277,587 - 14,842 - 10,292,429 Other services and charges 2,589,891 - 23,716 - 2,613,607 Depreciation expense 1,238,851 - - - 1,238,851 Total operating expenses 17,963,103 - 71,708 - 18,034,811 Operating income 5,199,107 - 63,854 - 5,262,961 NON-OPERATING REVENUES (EXPENSES) Investment income 109 8 - 12,122 12,239 Miscellaneous 7,686 - - - 7,686 Interest expense and fiscal charges (151,455) (31,798) - - (183,253) Total non-operating revenue (expenses) (143,660) (31,790) - 12,122 (163,328) Income (loss) before contrbutions and transfers 5,055,447 (31,790) 63,854 12,122 5,099,633 Transfers in, interaccount 622,575 216,012 - 134,870 973,457 Transfers out, interaccount (350,882) (622,575) - - (973,457) Contributed capital revenue 480,216 202,535 - - 682,751 Transfers in 6,345,498 60,651 - - 6,406,149 Transfers out (10,627,667) - - - (10,627,667) Change in net position 1,525,187 (175,167) 63,854 146,992 1,560,866 Total net position - beginning 9,127,591 (611,014) - 6,157,277 14,673,854 Total net position - ending $ 10,652,778 $ (786,181) $ 63,854 $ 6,304,269 $ 16,234,720 89  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Schedule of Cash Flows – Special Utility Authority Accounts - Year Ended June 30, 2016 Miami Special Utility Authority Accounts Utility Improvement Stormwater Rainy Day Public Utilities Account Account Account Total CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers $ 23,154,804 $ - $ 135,562 $ - $ 23,290,366 Payments to suppliers (12,920,790) 20,754 (38,558) - (12,938,594) Payments to employees (3,782,617) - (33,150) - (3,815,767) Receipts from other funds - - 31,992 - 31,992 Payments to other funds (28,449) - (28,449) Receipts of customer meter deposits 172,509 - - - 172,509 Refunds of customer meter deposits (197,730) - - - (197,730) Net cash provided by operating activities 6,397,727 20,754 95,846 - 6,514,327 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers from other funds 6,345,498 60,651 - - 6,406,149 Transfers to other funds (10,627,667) - - - (10,627,667) Interaccount transfer in - 216,012 - 134,870 350,882 Interaccount transfer out (350,882) - - - (350,882) Net cash provided by (used in) noncapital financing activities (4,633,051) 276,663 - 134,870 (4,221,518) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Capital assets purchased (227,940) (622,576) - - (850,516) Principal paid on debt (804,834) (185,000) - - (989,834) Proceeds of capital grants - 202,535 - - 202,535 Interest and fiscal agent fees paid on debt (156,574) (30,321) - - (186,895) Net cash provided by (used in) capital and related financing activities (1,189,348) (635,362) - - (1,824,710) CASH FLOWS FROM INVESTING ACTIVITIES Sale (Purchase) of investments (839) - - (11,949) (12,788) Interest and dividends 109 9 - 12,122 12,240 Net cash provided by (used in) investing activities (730) 9 - 173 (548) Net increase (decrease) in cash and cash equivalents 574,598 (337,936) 95,846 135,043 467,551 Balances - beginning of year 902,519 785,155 - 3,500,620 5,188,294 Balances - end of year $ 1,477,117 $ 447,219 $ 95,846 $ 3,635,663 $ 5,655,845 Reconciliation to Statement of Net Position: Cash and cash equivalents $ 727,044 $ - $ 95,846 $ 3,635,663 $ 4,458,553 Restricted cash and cash equivalents - current 314,551 447,219 - - 761,770 Restricted cash and cash equivalents - noncurrent 435,522 - - - 435,522 Total cash and cash equivalents, end of year $ 1,477,117 $ 447,219 $ 95,846 $ 3,635,663 $ 5,655,845 Reconciliation of operating income to net cash provided by (used in) operating activities: Operating income $ 5,199,107 $ - $ 63,854 $ - $ 5,262,961 Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation expense 1,238,851 - - - 1,238,851 Other nonoperating revenue 7,686 - - - 7,686 Change in assets and liabilities: Receivables, net (14,988) - - - (14,988) Other receivable (104) - - - (104) Due from other funds (24,770) - 31,992 - 7,222 Inventory (80,582) - - - (80,582) Deferred outflows related to pension (174,954) - - - (174,954) Accounts payable 27,270 20,754 - - 48,024 Due to other funds (3,679) - - - (3,679) Due to employees 28,274 - - - 28,274 Refundable deposits (25,221) - - - (25,221) Unfunded OPEB obligation 79,781 - - - 79,781 Net pension obligation 355,978 - - - 355,978 Accrued compensated absences 6,829 - - - 6,829 Deferred inflows related to pension (221,751) - - - (221,751) Net cash provided by operating activities $ 6,397,727 $ 20,754 $ 95,846 $ - $ 6,514,327 Noncash activities: Asset contributed by others $ 1,102,792 $ - $ - $ - $ 1,102,792 $ 1,102,792 $ - $ - $ - $ 1,102,792 90  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Statement of Net Position – Internal Service Funds – June 30, 2016 Internal Service Funds Worker's Health Compensation Unemployment Insurance Fund Fund Fund Total ASSETS Current assets: Cash and cash equivalents $ 1,065,659 $ 145,863 $ 7,043 $ 1,218,565 Investments 616,406 - - 616,406 Other receivable 1,223,523 - - 1,223,523 Total current assets 2,905,588 145,863 7,043 3,058,494 Total assets 2,905,588 145,863 7,043 3,058,494 LIABILITIES Current liabilities: Accounts payable and accrued liabilities - - 623 623 Claims liability 1,366,340 309 47,641 1,414,290 Due to other funds - - 7,487 7,487 Total liabilities 1,366,340 309 55,751 1,422,400 NET POSITION Unrestricted (deficit) 1,539,248 145,554 (48,708) 1,636,094 Total net position $ 1,539,248 $ 145,554 $ (48,708) $ 1,636,094 91  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Statement of Revenues, Expenses and Changes in Net Position – Internal Service Funds - Year Ended June 30, 2016 Internal Service Funds Worker's Compensation Unemployment Health Insurance Fund Fund Fund Total REVENUES Charges for services $ 383,335 $ 24,752 $ 1,640,612 $ 2,048,699 Miscellaneous 989,570 - 161,116 1,150,686 Total operating revenues 1,372,905 24,752 1,801,728 3,199,385 OPERATING EXPENSES Other services and charges 505,936 - - 505,936 Insurance claims and expense 578,902 7,466 2,086,744 2,673,112 Total operating expenses 1,084,838 7,466 2,086,744 3,179,048 Operating income (loss) 288,067 17,286 (285,016) 20,337 NON-OPERATING REVENUES Investment income 5,825 - - 5,825 Total non-operating revenue 5,825 - - 5,825 Income (loss) before contrbutions and transfers 293,892 17,286 (285,016) 26,162 Transfers in - - 330,000 330,000 Transfers out (330,000) - - (330,000) Change in net position (36,108) 17,286 44,984 26,162 Total net position - beginning 1,575,356 128,268 (93,692) 1,609,932 Total net position - ending $ 1,539,248 $ 145,554 $ (48,708) $ 1,636,094 92  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Statement of Cash Flows – Internal Service Funds - Year Ended June 30, 2016 WORKER'S HEALTH COMPENSATION UNEMPLOYMENT INSURANCE FUND FUND FUND TOTALS CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers $ 906,752 $ 24,752 $ 1,801,728 $ 2,733,232 Payments to suppliers (505,936) - - (505,936) Payments to other funds - - 7,487 7,487 Claims and benefits paid (175,687) (12,811) (2,244,920) (2,433,418) Net Cash Provided by (Used in) Operating Activities 225,129 11,941 (435,705) (198,635) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers from other funds - - 330,000 330,000 Transfers to other funds (330,000) - - (330,000) Net Cash Provided by (Used in) Non-Capital Financing Activities (330,000) - 330,000 - CASH FLOWS FROM INVESTING ACTIVITIES Interest and dividends 5,825 - - 5,825 Sale (Purchase) of investments (5,825) - - (5,825) Net Cash Provided by Investing Activities - - - - Net Increase (Decrease) in Cash and Cash Equivalents (104,871) 11,941 (105,705) (198,635) Balances - beginning of the year 1,170,530 133,922 112,748 1,417,200 Balances - end of the year $ 1,065,659 $ 145,863 $ 7,043 $ 1,218,565 Reconciliation to Statement of Net Position: Cash and cash equivalents $ 1,065,659 $ 145,863 $ 7,043 $ 1,218,565 Total cash and cash equivalents $ 1,065,659 $ 145,863 $ 7,043 $ 1,218,565 Reconciliation of operating income (loss) to net cash provided by (used in) operating activities: Operating income (loss) $ 288,067 $ 17,286 $ (285,016) $ 20,337 Change in assets and liabilities: Receivables, net (466,153) - - (466,153) Accounts payable - - 623 623 Due to other funds - - 7,487 7,487 Claims liability 403,215 (5,345) (158,799) 239,071 Net Cash Provided by (Used in) Operating Activities $ 225,129 $ 11,941 $ (435,705) $ (198,635) 93  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Combining Schedule of Cash Flows – Discretely Presented Component Units - Year Ended June 30, 2016 MCFA MDRA MIPFA Total CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers $ 141,325 $ 333,957 $ 42,466 $ 517,748 Payments to suppliers (89,162) (205,823) (14,661) (309,646) Payments to employees - (115,922) - (115,922) Net Cash Provided by Operating Activities 52,163 12,212 27,805 92,180 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Capital assets purchased (5,250) - - (5,250) Principal paid on capital debt (77,610) (19,650) - (97,260) Proceeds from issuance of long term debt - - - - Interest and fiscal charges paid on capital debt (15,412) (5,221) - (20,633) Net Cash Provided by (Used in) Capital and Related Financing Activities (98,272) (24,871) - (123,143) CASH FLOWS FROM INVESTING ACTIVITIES Interest and dividends - - 215 215 Net Cash Provided by Investing Activities - - 215 215 Net Increase (Decrease) in Cash and Cash Equivalents (46,109) (12,659) 28,020 (30,748) Balances - beginning of the year 297,648 42,839 196,152 536,639 Balances - end of the year $ 251,539 $ 30,180 $ 224,172 $ 505,891 Reconciliation to Statement of Net Position: Cash and cash equivalents $ 251,539 $ 30,180 $ 224,172 505,891 Restricted cash and cash equivalents - - - - Total cash and cash equivalents $ 251,539 $ 30,180 $ 224,172 $ 505,891 Reconciliation of operating income (loss) to net cash provided by operating activities: Operating income (loss) (88,671) (173,151) 6,624 ($255,198) Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation expense 177,793 2,526 19,681 200,000 Other nonoperating revenue 1,400 175,974 - 177,374 Change in assets and liabilities: Other receivable (700) - - (700) Accounts payables (37,659) 4,646 1,500 (31,513) Accrued compensated absences 2,217 - 2,217 Net Cash Provided by Operating Activities $ 52,163 $ 12,212 $ 27,805 $ 92,180 94  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Schedule of Federal Awards: Federal Grantor/ Pass-through Federal C.F.D.A. Grantor/Program Title Number Grant I.D. Number Award Amount Expenditures Institute of Museum and Library Services Pass through Oklahoma Department of Libraries Grants to States 45.310 F-16-165 $ 605 $ 443 Grants to States 45.310 F-16-078 1,000 7,032 Grants to States 45.310 F-16-116 6,500 3,136 Pass through Oklahoma Humanities Council Promotion of the Humanities 45.168 Y-16.013 1,000 1,000 Total Institute of Museum and Library Sciences 9,105 11,611 Department of Homeland Security . Pass through Oklahoma Emergency Management Disaster Grants - Public Assistance 97.036 FEMA 4222 23,058 23,058 Emergency Management Performance Grant 97.042 EMPG 15 26,699 13,350 Emergency Management Performance Grant 97.042 EMPG 16 26,699 13,350 Hazaard Mitigation Grant 97.039 HMPG 1985 110,264 2,000 Total Department of Homeland Security 186,720 51,758 Department of Housing an Urban Development Pass through Oklahoma Department of Commerce Community Development Block Grant 14.228 12989 CD 96 400,000 41,421 Total Department of Housing and Urban Development 400,000 41,421 Total Federal Awards $595,825 $104,790 Notes to Schedule of Expenditures of Federal Awards Note A - Significant Accounting Policies - The accompanying schedule of expenditures of federal awards is prepared on the basis of accounting consistent with the definition of federal awards expended in Uniform Guidance. 95  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 Debt Service Coverage Schedule - Year Ended June 30, 2016 DEBT SERVICE COVERAGE: OWRB Series 2001A, 2003A, 2004A, 2010 Sales Tax 2005 & 2006A and 2011 Promissory Notes Revenue Bonds GROSS REVENUE AVAILABLE: Charges for services (water, electric and wastewater) $21,023,730 $21,023,730 Investment income 12,239 12,239 Pledged sales tax - 6,345,498 Total Gross Revenue Available 21,035,969 27,381,467 OPERATING EXPENSES: Total Operating Expenses (excludes depreciation and amortization) 15,711,011 15,711,011 Net Revenue Available for Debt Service $5,324,958 $11,670,456 Maximum Annual Debt Service on all OWRB Obligations Payable From Revenues of the System $786,377 $786,377 Average Annual Debt Service on 2010 Sales Tax Revenue Bonds - 1,130,278 Average Annual Debt Service on 2011 Sales Tax Revenue Bonds - 214,080 $786,377 $2,130,735 Computed Coverage 677% 548% Coverage Requirement 125% 125% 96  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 INTERNAL CONTROL AND COMPLIANCE INFORMATION 97  CITY OF MIAMI, OKLAHOMA ANNUAL FINANCIAL REPORT As of and for the Year Ended June 30, 2016 THIS PAGE INTENTIONALLY LEFT BLANK 98  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 Honorable Mayor and Members of the City Council of the City of Miami, Oklahoma We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business- type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City of Miami, Oklahoma (the “City”), as of and for the year ended June 30, 2016, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated December 8, 2016. Other auditors audited the financial statements of the Miami Industrial Development Authority (“MIDA”), as described in our report on the City’s financial statements. This report does not include the results of the other auditors’ testing of internal controls over financial reporting or compliance and other matters that are reported on separately by those auditors. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (internal control) to determine the audit procedures that are 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 the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’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 that a material misstatement of the entity’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 first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Compliance and Other Matters As part of obtaining reasonable assurance about whether the City’s financial statements are free from 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. 99 309 N. Bryant Ave. • Edmond, OK 73034 • 405.348.0615 • Fax 405.348.0931 • www.jmacpas.com Member of AICPA and OSCPA 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 results of that testing, and not to provide an opinion on the effectiveness of the entity’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 entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. December 8, 2016 100