dickinson public school district, north dakota...2020/09/11 · bids received until: 11:00 a.m....

NEW ISSUE: BOOK-ENTRY ONLY RATING*: APPLIED FOR (MOODY’S) NORTH DAKOTA CREDIT ENHANCEMENT PROGRAM

In the opinion of Bond Counsel, the interest to be paid on the Bonds is included in gross income of the recipient for United States and State of North Dakota income tax purposes. See “TAX EXEMPTION” contained herein.

OFFICIAL STATEMENT $1,695,000(1)

TAXABLE GENERAL OBLIGATION SCHOOL BUILDING REFUNDING BONDS, SERIES 2020 RICHLAND PUBLIC SCHOOL DISTRICT NO. 44

RICHLAND COUNTY, NORTH DAKOTA

Dated: October 1, 2020 Principal Due: August 1, 2021 through 2033 Minimum Bid: $1,678,050 (99.0% of Par) Good Faith Deposit: $17,000

The $1,695,000(1) Taxable General Obligation School Building Refunding Bonds, Series 2020 (the “Bonds”) are being issued by the Richland Public School District No. 44, North Dakota (the “District”) pursuant to Chapter 21-03 of the North Dakota Century Code for the purpose of (i) refunding on a taxable advance refunding basis the 2024-2033 maturities of the District’s $1,605,000 General Obligation School Building Bonds, Series 2013A, dated September 10, 2013, and (ii) paying the costs associated with the issuance of the Bonds. The Bonds are general obligations of the District payable from ad valorem taxes on all taxable property within the corporate limits of the District. The District is required by law to include in its annual levy the principal and interest payments coming due to the extent the necessary funds are not provided from other sources.

The Bonds will be issued as fully registered bonds without coupons and, when issued, will be registered in the name of Cede & Co., as nominee of The Depository Trust Company (“DTC”), New York, New York. DTC will act as securities depository of the Bonds. Individual purchases may be made in book-entry form only, in the principal amount of $5,000 and integral multiples thereof. Purchasers will not receive certificates representing their interest in the Bonds purchased. Principal of the Bonds, payable annually as set forth below, and interest, payable semiannually on each February 1 and August 1 commencing February 1, 2021, will be paid to DTC, which will in turn remit such principal and interest to its participants for subsequent disbursement to the beneficial owners of the Bonds as described herein.

The Bonds will mature on August 1 in the years and amounts as follows:

Year Principal Interest Rate* Yield* Year Principal Interest Rate* Yield*

2021 $ 40,000 ______% ______% 2028 $ 160,000 ______% ______% 2022 25,000 ______% ______% 2029 160,000 ______% ______% 2023 25,000 ______% ______% 2030 165,000 ______% ______% 2024 150,000 ______% ______% 2031 170,000 ______% ______% 2025 150,000 ______% ______% 2032 170,000 ______% ______% 2026 150,000 ______% ______% 2033 175,000 ______% ______% 2027 155,000 ______% ______%

The Bonds maturing on August 1, 2029 and thereafter are subject to optional redemption on August 1, 2028 and any date thereafter at a price of par plus accrued interest to the redemption date.

PAYING AGENT: U.S. Bank National Association, St. Paul, Minnesota

ESCROW AGENT: BNY Mellon, Dallas, Texas

LEGAL OPINION: Arntson Stewart Wegner PC, Fargo, North Dakota

CREDIT ENHANCEMENT The District will participate in the North Dakota Credit Enhancement Program.

BIDS RECEIVED UNTIL: 11:00 A.M. Central Time on Wednesday, September 16, 2020 In the offices of PFM Financial Advisors LLC, Minneapolis, Minnesota 55402

BID CONSIDERATION: By the School Board on Wednesday, September 16, 2020

DELIVERY: Delivery is anticipated on or about October 1, 2020.

The date of this Official Statement is September 11, 2020. * Interest rates, reoffering yields or prices, and rating will be set forth in the Final Official Statement described herein. (THIS COVER PAGE CONTAINS CERTAIN INFORMATION FOR QUICK REFERENCE ONLY. IT IS NOT A SUMMARY OF THIS ISSUE. INVESTORS MUST READ THE ENTIRE OFFICIAL STATEMENT TO OBTAIN INFORMATION ESSENTIAL TO THE MAKING OF AN INFORMED INVESTMENT DECISION.)

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No dealer, broker, salesman or other person has been authorized by the District, the Municipal Advisor or the Underwriters to give any information or to make any representations other than those contained in this Official Statement or the Final Official Statement and, if given or made, such information and representations must not be relied upon as having been authorized by the District, the Municipal Advisor or the Underwriters. This Official Statement or the Final Official Statement does not constitute an offer to sell or solicitation of an offer to buy, nor shall there by any sale of the Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. The information set forth herein has been obtained from the District and other sources which are believed to be reliable, but it is not to be construed as a representation by the Municipal Advisor or Underwriters. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement or the Final Official Statement nor any sale made thereafter shall, under any circumstances, create any implication that there has been no change in the affairs of the District or in any other information contained herein, since the date hereof. IN CONNECTION WITH THE OFFERING OF THE BONDS, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

TABLE OF CONTENTS

Page Page Introduction to the Official Statement ...................... 1 Description of the Bonds .......................................... 3

Authority and Purpose .......................................... 3 Security and Sources of Payment .......................... 3 North Dakota Credit Enhancement Program......... 3 Interest .................................................................. 4 Redemption Provisions ......................................... 4 Estimated Sources and Uses of Funds................... 4 Bondholder’s Risk ................................................ 5 Book-Entry Only System ...................................... 5 Limited Continuing Disclosure ............................. 7

The District ............................................................... 8 General Information .............................................. 8 Organization and Administration .......................... 8 Enrollment Trends ................................................ 9 Pension Plans ........................................................ 9

Economic and Demographic Information ................. 10 Population ............................................................. 10 Principal Taxpayers............................................... 10 Employment Statistics ........................................... 11 Major Employers .................................................. 11

Financial Summary ................................................... 12 Debt Structure ........................................................... 13

General Obligation Debt ....................................... 13 Short-Term Debt ................................................... 14 Future Financing ................................................... 14 Debt Limit ............................................................. 14 Overlapping Debt .................................................. 14

Financial Information ............................................... 15 Financial Reports .................................................. 15 Results of Operations ............................................ 15

Property Valuations and Taxes ................................. 17 Tax Levies and Collections ................................... 18 Tax Rates Per $1,000 of Taxable Value ................ 18

Ratings ...................................................................... 18 Municipal Advisor .................................................... 18 Not Qualified Tax-Exempt Obligations .................... 19 Legal Matters ............................................................ 19 Litigation .................................................................. 19 Miscellaneous ........................................................... 19

Appendix A - The District’s Audited Financial

Statements for the Fiscal Year Ended June 30, 2019

Appendix B - Form of Legal Opinion Appendix C - Form of Continuing Disclosure Certificate Appendix D - Official Notice of Sale Bid Form

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INTRODUCTION TO THE OFFICIAL STATEMENT

The following information is furnished solely to provide limited introductory information regarding the $1,695,000(1)

Taxable General Obligation School Building Refunding Bonds, Series 2020 (the "Bonds") issued by the Richland Public School District No. 44, North Dakota (the "District") and does not purport to be comprehensive. All such information is qualified in its entirety by reference to the more detailed descriptions appearing in this Official Statement, including the appendices hereto.

Issuer: Richland Public School District No. 44, North Dakota.

Purpose: The proceeds of the Bonds will be used for the purpose of (i) refunding on a taxable advance refunding basis the 2024-2033 maturities of the District’s $1,605,000 General Obligation School Building Bonds, Series 2013A, dated September 10, 2013, and (ii) paying the costs associated with the issuance of the Bonds.

Security: The Bonds are general obligations of the District payable from ad valorem taxes on all taxable property within the corporate limits of the District. The District is required by law to include in its annual levy the principal and interest payments coming due to the extent the necessary funds are not provided from other sources.

Dated Date: October 1, 2020

Principal Payment: Principal is payable annually on August 1, of the years 2021 through 2033.

Interest Payment: Interest is payable on February 1 and August 1, commencing February 1, 2021.

Redemption Provisions: The Bonds maturing on August 1, 2029 and thereafter are subject to optional redemption on August 1, 2028 and any date thereafter at a price of par plus accrued interest to the redemption date.

Credit Enhancement: The District will participate in the North Dakota School District Credit Enhancement Program.

Denominations: $5,000 or integral multiples thereof of a single maturity.

Book-Entry Only: The Bonds will be issued as book-entry only securities through the Depository Trust Company.

Record Date: The 15th day of the month preceding the payment date.

Form: The Bonds will be issued in book-entry form only. See "Book-Entry Only System" herein.

Tax Status: The Bonds are NOT exempt from federal and state income taxes. See “Not Tax-Exempt Obligations” herein.

Professional Consultants: Municipal Advisor: PFM Financial Advisors LLC Fargo, North Dakota Minneapolis, Minnesota

Bond Counsel: Arntson Stewart Wegner PC Fargo, North Dakota

Paying Agent: U.S. Bank National Association St. Paul, Minnesota

Escrow Agent: BNY Mellon Dallas, Texas

Delivery: On or about October 1, 2020

(1) Preliminary, subject to change.

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The Official Statement is in a form deemed final as of its date for purposes of Securities and Exchange Commission Rule 15c2-12(b)(1) (the "Rule"), but is subject to minor revision or amendment in accordance with the Rule. Not later than seven business days following the award of the Bonds, the District shall provide copies of the Final Official Statement, as that term is used in the Rule, to the purchaser of the Bonds. The Final Official Statement will be the Official Statement dated September 23, 2020, which will include the maturity dates and amounts, interest rates and reoffering yields or prices, credit ratings, and any other information required by law. The purchaser will be supplied with Final Official Statements in a quantity sufficient to meet its request. Up to 25 copies of the Final Official Statement will be furnished without cost to the purchaser. The information set forth herein has been obtained from the District and other sources which are believed to be reliable, but it is not to be constructed as a representation by the Municipal Advisor or Underwriter. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement or the Final Official Statement nor any sale made thereafter shall, under any circumstances, create any implication that there has been no change in the affairs of the District or in any other information contained herein, since the date hereof. Questions regarding the Bonds or the Official Statement can be directed to and additional copies of the Official Statement, the District’s audited financial reports and the resolutions awarding the sale of the Bonds may be obtained from PFM Financial Advisors LLC, 50 South Sixth Street, Suite 2250, Minneapolis, Minnesota 55402 (612/338-3535), the District’s Municipal Advisor.

(The remainder of this page has been left blank intentionally.)

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DESCRIPTION OF THE BONDS Authority and Purpose The Bonds are being issued by the District pursuant to Chapter 21-03 of the North Dakota Century Code. The proceeds of the Bonds will be used for the purpose of refunding on a taxable advance refunding basis the 2024-2033 maturities of the District’s $1,605,000 General Obligation School Building Bonds, Series 2013A (the “Refunded Bonds”), dated September 10, 2013 and paying the costs associated with the issuance of the Bonds. The Refunded Bonds were originally issued to finance the expansion of the elementary school including a new library-media center, music room, and gymnasium. Table 1 below provides a list of the outstanding maturities and amount of the Refunded Bonds and the maturities and amounts to be refunded.

Table 1 Plan of Refunding

Series Outstanding Maturities

Amount Outstanding CUSIP Call Date Call Price

Par Amount to be Refunded

2013A 2024 $ 140,000 763612 BL1 08/01/2021 100% $ 140,000 2025 140,000 763612 BM9 08/01/2021 100% 140,000 2026 145,000 763612 BN7 08/01/2021 100% 145,000 2027 150,000 763612 BP2 08/01/2021 100% 150,000 2028 155,000 763612 BQ0 08/01/2021 100% 155,000 2029 160,000 763612 BR8 08/01/2021 100% 160,000 2030 170,000 763612 BS6 08/01/2021 100% 170,000 2031(1) 175,000 763612 BV9 08/01/2021 100% 175,000 2032(1) 180,000 763612 BV9 08/01/2021 100% 180,000 2033(1) 190,000 763612 BV9 08/01/2021 100% 190,000

Total $ 1,605,000 $ 1,605,000

(1) Term bond maturing on August 1, 2033. The District will deposit the proceeds of the Bonds and other funds into an escrow account, in such amount as may be required to be invested in securities authorized for such purpose by North Dakota Century Code maturing on such dates and bearing interest at such rates as are required to provide funds sufficient, along with cash retained in the escrow account, to pay principal of the Refunded Bonds on the redemption date, and to pay interest due on the Refunding Bonds to and including the redemption date. Security and Sources of Payment The Bonds are valid and binding general obligations of the District payable from ad valorem taxes on all taxable property located in the District. The District is required by law to include in its annual tax levy the principal and interest coming due on the Bonds to the extent the necessary funds are not provided from other sources. North Dakota Credit Enhancement Program The District has elected to participate in the North Dakota School District Credit Enhancement Program (the “Program”). Under the Program, if a school district is unable to make a bond payment, upon receipt of a notice of potential default, the State of North Dakota (the “State”) will make the payment three days prior to the bond payment date from funds due, or payable, or appropriated to the school district under Chapter 15.1-27 of the North Dakota Century Code. To participate in the Program, the District’s school board must adopt a resolution (the “Resolution”) wherein the school district elects to participate in the Program, obligates the school district to be bound by the provisions of Section 6-09.4-23 and authorizes the withholding of state funds as required by the Program. The Resolution must further provide that the election to participate in the Program is irrevocable so long as the evidence of indebtedness enhanced by the Program remains

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outstanding and unpaid. The Resolution also must require the school district to deposit a bond payment with the paying agent five days before the payment date to the bondholders; certify that the state funds available to the school district under NDCC Chapter 15.1-27 are at least 2 times the maximum annual debt service on the bonds; and provide for an additional bonds test requiring at least 2 times coverage of the maximum annual debt service for all outstanding bonds and subsequent bonds issued under the Program. The projected maximum annual debt service for all outstanding issues participating in the program, including this issue is $265,245 in the year ending June 30, 2022. The total state aid due to the District for the 2020-21 school year is $2,709,562.87. The state aid provides 10.22 times coverage for the maximum annual debt service of all outstanding bonds in the Program. Interest Interest on the Bonds will be payable annually on each August 1 and February 1, commencing February 1, 2021. Interest will be computed on a 360-day year, 30-day month basis, and paid to the owners of record as of the close of business on the fifteenth day of the immediately preceding month. Payments coming due on a non-business day will be paid on the next business day. Redemption Provisions Optional Redemption The Bonds maturing on August 1, 2029 and thereafter are subject to optional redemption on August 1, 2028 and any date thereafter at a price of par plus accrued interest to the redemption date. Notice of Redemption: Notice of the call for any redemption shall identify the Bonds to be redeemed and shall be given by the Bond Registrar by a mailing of a copy of the redemption notice by first-class mail not less than thirty (30) days not more than sixty (60) days prior to the redemption date to the registered owner of each Bond. The notice shall specify (i) the place where the Bond must be delivered for redemption, (ii) the redemption date, and (iii) that from and after the redemption date interest on the Bond shall cease to accrue; provided, however, that failure to give such notice by mailing, or any defect therein shall not affect the validity of an proceedings for the redemption of the Bonds. Estimated Sources and Uses of Funds Table 2 below presents the estimated sources and uses of funds for the Bonds.

Table 2 Estimated Sources and Uses of Funds

Sources of Funds

Par Amount $ 1,695,000(1)

Total Sources of Funds

Uses of Funds

Refunding Escrow Deposit Cost of Issuance/ Underwriter’s Discount Contingency

Total Uses of Funds

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Bondholder’s Risk Secondary Market There can be no guarantee that there will be a secondary market for the Bonds or, if a secondary market exists, that such Bonds can be sold for any particular price. Such prices could be substantially different from the original purchase price of the Bonds. EACH PROSPECTIVE PURCHASER IS RESPONSIBLE FOR ASSESSING THE MERITS AND RISKS OF AN INVESTMENT IN THE BONDS AND MUST BE ABLE TO BEAR THE ECONOMIC RISK OF SUCH INVESTMENT. THE SECONDARY MARKET FOR THE BONDS, IF ANY, COULD BE LIMITED. Global Health Emergency Risk: On March 11, 2020, the World Health Organization proclaimed the Coronavirus (COVID-19) to be a pandemic. In an effort to lessen the risk of transmission of COVIC-19, the United States government, state governments, local governments, and private industries have taken measures to limit social interactions in an effort to limit the spread of COVID-19, affecting business activities and impacting global, state and local commerce and financial markets. The emergence of COVID-19 and spread thereof is an emerging and evolving issue. On March 13, 2020 the Governor of North Dakota (the “Governor”) declared a state of emergency with respect to the COVID-19 pandemic. Thereafter, by various executive orders, the Governor directed the closure of all schools, most businesses and directed that all non-essential State agency staff members work from home. On April 29, 2020, by executive order, the Governor directed that certain business could reopen on May 1, 2020 following North Dakota Smart Restart: Standards for All Industries. As the federal, state and local governments, continuing efforts to contain and limit the spread of the COVID-19 disease, future tax and other revenue collections may deviate from historical or anticipated collections and may have an adverse impact on the financial position and operations of the School District and its ability to fund debt obligations including the Bonds in accordance with its terms. In addition to tax proceeds received by the State, the State uses the income from the Common Schools Trust Fund and the Foundation Aid Stablization Fund to finance the operation of North Dakota school districts. The School District is not able to predict and makes no representation as to the economic-impact of the COVID-19 pandemic on the School District or its financial position. Book-Entry Only System The information contained in the following paragraphs of this subsection “Book-Entry Only System” has been extracted from a schedule prepared by Depository Trust Company (“DTC”) entitled “SAMPLE OFFERING DOCUMENT LANGUAGE DESCRIBING BOOK-ENTRY ONLY ISSUANCE.” The District makes no representation as to the completeness or the accuracy of such information or as to the absence of material adverse changes in such information subsequent to the date hereof. The Depository Trust Company (“DTC”), New York, NY, will act as securities depository for the Bonds (the “Bonds”). The Bonds will be issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Bond certificate will be issued for each annual maturity of the Bonds, each in the aggregate principal amount of such annual maturity, and will be deposited with DTC. DTC, the world’s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for

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DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com. Purchases of Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Bonds on DTC ’s records. The ownership interest of each actual purchaser of each Bond (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Bonds, except in the event that use of the book-entry system for the Bonds is discontinued. To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Redemption notices shall be sent to DTC. If less than all of the Bonds within an issue are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Bonds unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the District as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy). Redemption proceeds, distributions, and dividend payments on the Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the District or Agent, on payable date in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participant and not of DTC, Agent, or the District, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the District or Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. DTC may discontinue providing its services as depository with respect to the Bonds at any time by giving reasonable notice to the District or Agent. Under such circumstances, in the event that a successor depository is not obtained, Bond certificates are required to be printed and delivered. The District may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Bond certificates will be printed and delivered to DTC. The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that the District believes to be reliable, but the District takes no responsibility for the accuracy thereof.

http://www.dtcc.com/

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NEITHER THE DISTRICT NOR THE UNDERWRITERS WILL HAVE ANY RESPONSIBILITY OR OBLIGATION TO PARTICIPANTS, TO INDIRECT PARTICIPANTS OR TO ANY BENEFICIAL OWNER WITH RESPECT TO (1) THE ACCURACY OF ANY RECORDS MAINTAINED BY DTC, ANY DTC PARTICIPANT OR ANY INDIRECT PARTICIPANT; (2) THE PAYMENT BY DTC, ANY DTC PARTICIPANT OR ANY INDIRECT PARTICIPANT OF ANY AMOUNT WITH RESPECT TO THE PRINCIPAL OF OR INTEREST ON THE BONDS; (3) ANY NOTICE WHICH IS PERMITTED OR REQUIRED TO BE GIVEN TO CERTIFICATEHOLDERS; (4) ANY CONSENT GIVEN BY DTC OR OTHER ACTION TAKEN BY DTC AS CERTIFICATEHOLDER; OR (5) THE SELECTION BY DTC, ANY DTC PARTICIPANT OR ANY INDIRECT PARTICIPANT OF ANY BENEFICIAL OWNER TO RECEIVE PAYMENT IN THE EVENT OF A PARTIAL REDEMPTION OF BONDS. Limited Continuing Disclosure In order to assist the Underwriters in complying with SEC Rule 15c2-12 promulgated by the Securities and Exchange Commission, pursuant to the Securities Exchange Act of 1934 (the “Rule”), the District has agreed for the benefit of the holders and beneficial owners of the Bonds to provide an annual report relating to the District (the “Annual Report”), not later than 365 days after the end of each fiscal year, commencing with the fiscal year ended June 30, 2020, and to provide notices of the occurrence of certain enumerated material events. The Annual Report and material event notices are to be filed with the MSRB through its Electronic Municipal Market Access system (EMMA) at www.emma.msrb.org. The details and terms of the undertaking, as well as the information to be contained in the annual report or the notices of material events are set forth in the Continuing Disclosure Certificate to be executed and delivered by the District at the time the Bonds are delivered. Such undertaking will be in substantially the form attached hereto as Appendix C. In the last five years, the District failed to file its Annual Report for the fiscal years ended June 30, 2016 through 2018. The Annual Reports for the fiscal year ended June 30, 2019 was filed on June 1, 2020. Breach of the Disclosure Covenants will not constitute a default or an “Event of Default” under the Bonds or the Resolution. A broker or dealer is to consider a known breach of the Disclosure Covenants, however, before recommending the purchase or sale of the Bonds in the secondary market. Thus, a failure on the part of the District to observe the Disclosure Covenants may adversely affect the transferability and liquidity of the Bonds and their market price.


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THE DISTRICT General Information The Richland Public School District (the “District”) is located in Richland County in Southeastern North Dakota and covers 222 squares miles. It is approximately 30 miles south of Fargo and includes the cities of Abercrombie, Colfax, and Christine and surrounding townships. The District serves a population of approximately 1,500 with two educational facilities and a vocational and technology center which is a joint venture with Richland County. The District currently operates two buildings, of which Table 3 provides a description.

Table 3 District Facilities

Building Year Built

Additions Grades Estimated Capacity

Junior/Senior High 1962 2000, 2010, 2013 7-12 190 Elementary 1938 1958, 1959, 1972,

2000, 2011 K-6 190

Organization and Administration The District is governed by a seven-member Board of Education.

Members of the Board

Name Position Term Expires

Nathan Berseth Board President 2023 Craig Olson Board Vice President 2021 Scott Hendrickson Member 2022 Amy Lehmann Member 2022 Nicole Holdman Member 2021 Jody Lingen Member 2023 Todd Johnson Member 2022

Administration

Name Position

Britney Gandhi Superintendent Kendra Dockter Business Manager

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Enrollment Trends The District’s enrollment for the 2020/21 school year is 261 K-12 students. Enrollments in the District for the past five school years are set forth in Table 4 below.

Table 4 District Enrollment

School Year Students

2020/21 261 2019/20 240 2018/19 235 2017/18 240 2016/17 252 2015/16 256

Source: The District. Pension Plans Substantially all employees of the District are members of the Teachers’ Fund for Retirement (“TFFR”). Teachers’ Fund for Retirement TFFR is a cost-sharing multiple-employer defined benefit pension plan covering all North Dakota public teachers and certain other teachers who meet various membership requirements. TFFR provides for pension, death and disability benefits. The cost to administer the TFFR plan is financed by investment income and contributions. Member and employer contributions paid to TFFR are set by NDCC Section 15-39.1-09. Every eligible teacher in the State of North Dakota is required to be a member of TFFR and is assessed at a rate of 11.75% of salary as defined by NDCC Section 15-39.1-04. Every governmental body employing a teacher must also pay into TFFR a sum equal to 12.75% of the teacher’s salary. Member and employer contributions will be reduced to 7.75% each when the fund reaches a 100% funded ratio on an actuarial basis. The District’s proportionate share of the net pension liability for the years ending June 30, 2019, 2018, and 2017, were $2,969,035, $3,200,780, and $3,266,307 respectively. North Dakota Public Employees Retirement System The District contributes to the North Dakota Public Employees’ Retirement System (NDPERS); a cost-sharing multiple-employer defined benefit pension plan administered by the State of North Dakota for its non-certified staff. NDPERS provides for retirement, disability and survivor benefits to plan members and beneficiaries. Benefit and contribution provisions are administered in accordance with Chapter 54-52 of the North Dakota Century Code. NDPERS issues a publicly available financial report that includes financial statements and required supplementary information for NDPERS. That report may be obtained by writing to NDPERS, 400 E. Broadway, Suite 505, P.O. Box 1214, Bismarck, North Dakota, 58502-1214. Plan members are required to contribute 7% of their annual salary. The District is required to contribute 8.26% of the employee’s salary which consists of 7.12% for employee retirement and 1.14% for the retiree health benefits fund. The contribution requirements of plan members and the District are established and may be amended by the State Legislature. The District’s contributions to NDPERS for the years ending June 30, 2019, 2018, and 2017 were $34,568, $31,363, and $27,102 respectively. For additional information, see Note 15 of the District’s Audit Report for the Year Ended June 30, 2019.

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ECONOMIC AND DEMOGRAPHIC INFORMATION Population Table 5 shows the population for Richland County for the past four decennial censuses, and the most recent estimate.

Table 5 Population

Census Year Richland County

2019 (Estimate) 16,177 2010 16,321 2000 17,998 1990 18,148 1980 19,207

Source: U.S. Census Bureau, www.census.gov. Principal Taxpayers Table 6 presents a list of the principal taxpaying parcels in the District with the highest taxable valuations for the 2019 assessment, for taxes payable in 2020.

Table 6 Principal Taxpayers

Taxpayer Taxable Value

% of Total Taxable

Valuation(1)

5K Farms LLLP $ 196,069 1.55% Red River Valley & Western RR 100,828 0.79% Individual 97,275 0.77% Individual 96,668 0.76% Individual 89,485 0.71% Individual 85,500 0.67% Individual 84,450 0.67% Colfax Farmers Elevator 84,170 0.66% Individual 82,001 0.65% Richardson Family Farms LLC 78,140 0.62%

Total $ 994,586 7.84%

(1) Based on the 2019/20 Taxable Value of $12,688,830.36.

Source: The District.


http://www.census.gov/

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Employment Statistics Average annual employment figures for the last five years and the most recent figure available, for Richland County, the State of North Dakota, and the United States of America, are listed in Table 7 below.

Table 7 Average Annual Employment Figures

Richland County North Dakota United States

Year

Labor Force Unemployment

Rate Unemployment

Rate Unemployment

Rate

2020(1) 8,341 4.4% 6.3% 10.5%(2) 2019 8,530 2.3% 2.4% 3.7% 2018 8,672 2.6% 2.6% 3.9% 2017 8,791 2.4% 2.7% 4.4% 2016 8,899 2.7% 3.1% 4.9% 2015 8,577 2.7% 2.8% 5.3%

(1) As of June, 2020. Preliminary. (2) Not Preliminary.

Source: Job Service North Dakota. Major Employers Table 8 below presents a listing of major employers within the District.

Table 8 Major Employers

Employer

Business/Service

Number of Employees

Red River Communications Communications 40 Colfax Farmers Elevator Agriculture 15 Northland Truss Systems Building Products 40 CHS-Dakota Ag Coop Agriculture 8 Colfax Express Convenience/Fuel 5

Source: The District. The Wahpeton metro area is about 15 miles southeast of the District, so many of the District’s residents commute for employment. Table 9 below presents a listing of major employers in the Wahpeton metro area.

Table 9 Major Employers

Employer Business/Service Number of Employees

North Dakota State College of Science Education 600 Prime Wood Inc Manufacturers 499 Minndak Farmers Co-Op Manufacturers 450 Heartland Precision Manufacturers 300 Walmart Supercenter Department Stores 160 Comdel Innovation Federal Government Contractors 150 Comstock Construction of North Dakota General Contractors 150 Cargill Inc Agricultural 135 WCCO Belting Inc Belting Supplies 130 WIL-RICH LLC Manufacturers 130

Sources: Reference USA.

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FINANCIAL SUMMARY

(This summary is subject in all respects to more complete information contained in this Official Statement.) 2019/20 Market Value (100%) $ 263,365,415 2019/20 Assessed Value (50%) $ 131,682,707 2019/20 Taxable Value $ 12,688,830 General Obligation Debt (Includes the Bonds) $ 5,156,235 Overlapping General Obligation Debt $ 172,349 Population (District Estimate) 1,500 Debt Ratios: Debt Per Capita % of Amount (1,500) Market Value General Obligation Debt $ 5,156,235 $ 3,437 1.96% Overlapping Debt 172,349 115 0.13% Total $ 5,328,584 $ 3,552 2.09%


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DEBT STRUCTURE General Obligation Debt Table 10 and Table 11 summarize the District’s outstanding general obligation long-term debt as of the issuance of the Bonds.

Table 10 General Obligation Debt by Issue

Date

Issue

Original Issue Size

Interest Range Outstanding

Outstanding Maturities

Principal Outstanding

2013 State School Construction Loan $ 4,292,470 1.00% 06/01/21-33 $ 2,886,235 09/10/13 School Building Bonds 1,605,000 3.00%-4.00% 08/01/24-33 --(1) 08/01/16 School Building Refunding 1,100,000 1.20% - 1.40% 08/01/21-23 575,000 10/01/20 School Building Refunding 1,695,000(2) This Issue 08/01/21-33 1,695,000(2)

Total $ 5,156,235

(1) The 2024-2033 maturities will be refunded by the Series 2020 Bonds and have therefore not been included in the outstanding debt computation.

(2) Preliminary, subject to change Table 11

General Obligation Debt Annual Maturity Schedule(1)

Outstanding This Issue

Fiscal Year Principal Interest Principal(2) Interest(2) Total

2021 $ 209,006 $ 32,702 $ -- $ 11,358 $ 253,067 2022 396,096 33,342 40,000 33,675 503,114 2023 408,207 28,756 25,000 33,025 494,989 2024 410,339 23,894 25,000 32,525 491,759 2025 217,493 20,376 150,000 30,775 418,644 2026 219,668 18,201 150,000 27,775 415,644 2027 221,864 16,004 150,000 24,775 412,644 2028 224,083 13,786 155,000 21,725 414,594 2029 226,324 11,545 160,000 18,575 416,444 2030 228,587 9,282 160,000 15,375 413,244 2031 230,873 6,996 165,000 12,125 414,994 2032 233,182 4,687 170,000 8,775 416,644 2033 235,513 2,355 170,000 5,375 413,244 2034 -- -- 175,000 1,838 176,838

Total $ 3,461,235 $ 221,926 $ 1,695,000 $ 277,696 $ 5,655,857

(1) Totals may not add due to rounding. (2) Estimated.

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Short-Term Debt The District has no short-term debt. Future Financing The District does not expect to issue any new debt in the next six months. Debt Limit According to Article V, Section 15 of the North Dakota Constitution and Section 21-03-04 of the North Dakota Century Code, North Dakota Schools Districts may not become indebted for any purpose in excess of 5% of their assessed value except that a school district by a majority vote of the qualified voters voting upon the question at a general or special election, may increase such limitation of indebtedness five percent on such assessed value beyond the five percent limit. The District’s debt limit has been increased to ten percent. Section 57-02-01(16) of the North Dakota Century Code defines “Assessed Value” as 50% of the true and full value of the property. The table below presents the District’s debt limit computation as of the issuance of the Bonds.

Table 12 Debt Limit Computation

Assessed Value $ 131,682,707 Limit Percentage 10.00%

Authorized Debt Limit (100.00%) $ 13,168,271 Debt Subject to Limit (39.16%) 5,156,235(1)

Debt Margin (60.84%) $ 8,012,035

(1) Subject to change. Overlapping Debt One jurisdiction overlaps the District boundaries that has general obligation debt outstanding as of September 1, 2020. Table 13 sets forth the debt for that jurisdiction and the amount of its debt allocable to the District. General obligation debt includes all debt payable from general tax levies and special assessments.

Table 13 Overlapping Debt

General % of Debt Portion Obligation Allocable to Allocable to Debt the District the District

Richland County Water Resource District $ 1,335,000 12.91% $ 172,349

Total $ 172,349

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FINANCIAL INFORMATION Financial Reports The District’s financial reports are audited annually by an independent auditor. Copies of the District’s audited financial statements for the years ended June 30, 2016 through 2019 are available upon request from the District’s municipal advisor, PFM Financial Advisors LLC. See Appendix A for the District’s financial statements for the fiscal year ended June 30, 2019. Results of Operations Statements of revenues and expenditures of the General Fund of the District have been compiled from the District’s Financial Statements and presented in a format to facilitate year-to-year comparison. Table 14 presents a statement of revenues, expenditures and changes in fund balance for the fiscal years ended June 30, 2017 through 2019. Table 15 on the next page provides a summary of the District’s 2020 general fund budget.

Table 14 Statement of Revenues, Expenditures and

Changes in Fund Balance for the General Fund (Years Ended June 30)

2019 2018 2017 Revenues Local Sources $ 774,744 $ 677,167 $ 674,798 State Sources 2,717,497 2,875,289 2,921,838 Federal Sources 89,129 106,950 118,930 Interest Income 26,693 13,897 3,345 Miscellaneous 3,839 1,935 12,764 Total Revenues $ 3,611,902 $ 3,675,238 $ 3,731,675 Expenditures Current:

Regular Instruction $ 1,969,835 $ 1,976,710 $ 1,904,303 Special Instruction 260,517 243,612 314,993 Vocational Education 204,323 189,398 213,240 Pupil Services 118,252 100,798 98,085 General Administration 244,219 193,653 137,331 School Administration 151,343 288,814 140,506 Operation and Maintenance 393,461 346,716 376,173 Pupil Transportation 173,112 250,744 187,963 Student Activities 127,099 150,766 151,759 Community Services 28,437 38,846 33,607

Capital Outlay -- -- 29,400 Total Expenditures $ 3,670,598 $ 3,780,055 $ 3,587,360 Other Financing Sources (Uses) Operating Transfer In $ 30,000 $ -- $ 29,400 Operating Transfer Out -- (10,000) -- Total Other Financing Sources (Uses) $ 30,000 $ (10,000) $ 29,400 Excess (Deficiency) of Revenues Over (Under) Expenditures $ (58,696) $ (104,817) $ 144,315 Net Change in Fund Balance $ (28,696) $ (114,817) $ 173,715 Fund Balance – July 1 997,940 1,112,757 939,048 Fund Balance – June 30 $ 969,244 $ 997,940 $ 1,112,763

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Table 15 General Fund Budgets

Revenues 2020 Budget

Local Sources $ 865,444 State Revenue 2,707,548 Federal Revenue 95,622 Other --

Total Revenues $ 3,668,614

Expenditures $ 3,660,025


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PROPERTY VALUATIONS AND TAXES The County Assessor's office establishes an estimated market value on all properties. The assessed value is computed at 50% of estimated market value. The taxable value is then computed in the following manner: on residential property the taxable value is 9% of the assessed value; on commercial property the taxable value is 10% of the assessed value. Table 16 shows the market, assessed and taxable values of taxable property in the District for assessment year 2019/collection year 2020. Table 17 shows the trend in property valuations for the previous five years.

Table 16 Property Values

Market Value Assessed Value Taxable Value Real Property:

Residential $ 95,888,068 $ 47,944,034 $ 4,314,963 Agricultural 158,314,100 79,157,050 7,915,705 Commercial 6,160,500 3,080,250 308,025

Utilities:

Railroad 2,016,064 1,008,033 100,803 Other Utilities 986,680 493,340 49,334

Total $ 263,365,412 $ 131,682,707 $ 12,688,830

Table 17 Trend in Valuations

Assessment Market Assessed Taxable

Year Value Value Value

2018 $ 245,219,895 $ 122,609,948 $ 11,835,716 2017 222,662,850 111,331,430 10,799,097 2016 218,205,390 109,102,695 10,594,823 2015 209,269,740 104,634,870 10,183,493 2014 200,714,282 100,357,141 9,758,611

Source: Richland County Auditor. After final equalization by assessing authorities in September of each year, the County Auditor calculates mill rates and spreads taxes. The resulting taxes are payable on the following January 1. Taxes are collected by the County in two semiannual installments, and the receipts are distributed by the County to the local government entities. A discount of five percent is given on the tax bill if the entire payment is made by February 15. Discounts given are subtracted from the levy amount by the County Auditor. If taxes are not paid by March 1, a three percent penalty is charged with the penalty being raised on May 1 to six percent, on July 1 to nine percent, and on October 15 to twelve percent. North Dakota residents over 65 years of age whose income is less than $42,000 receive a homestead property tax credit. The credit is subtracted from their tax bill. Local government entities are reimbursed by the state for all homestead credits. Therefore, the District, as well as other local government entities, has no loss in tax revenues from the credit.

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Tax Levies and Collections Table 18 summarizes the District's tax levies and collections for the past four years and the current levy in Richland County.

Table 18 Tax Levies and Collections

Collected in Collection Year Collected as of 07/31/20

Collection Net % of % of Year Levy Levy Amount Net Levy Amount Net Levy

2020 $ 1,509,971 $ 1,434,472 $ 1,392,034 97.04% $ 1,392,034 97.04% 2019 1,432,003 1,360,403 1,358,137 99.83% 1,361,894 100.11% 2018 1,303,343 1,238,176 1,238,384 100.02% 1,245,852 100.62% 2017 1,121,331 1,065,264 1,041,101 97.73% 1,069,616 100.41% 2016 1,080,843 1,026,801 1,017,058 99.05% 1,030,857 100.40%

Source: Richland County Auditor. Tax Rates Per $1,000 of Taxable Value Table 19 shows the breakdown for the District’s 2016-2019 property tax levy in mills.

Table 19 Property Tax Rate Breakdown (in Mills)

2019 2018 2017 2016

Tax Rate

General Fund 62.00 61.31 60.00 59.79 Miscellaneous 0.00 0.68 0.00 0.00 Sinking and Interest 44.50 46.50 50.19 50.02 Building Fund 10.00 10.00 10.00 9.96 Special Reserve 2.50 2.50 0.50 0.50

Total 119.00 120.99 120.69 120.27 Source: The District.

RATINGS A rating for the Bonds has been requested from Moody’s Investor Service, Inc. (“Moody’s”). A rating is subject to withdrawal at any time; withdrawal of a rating may have an adverse effect on the marketability of the Bonds. For an explanation of the significance of the rating, an investor should communicate with the rating agency.

MUNICIPAL ADVISOR The District has retained PFM Financial Advisors, LLC, of Minneapolis, Minnesota, as Municipal Advisor (the “Municipal Advisor”) in connection with the issuance of the Bonds. In preparing the Official Statement, the Municipal Advisor has relied upon governmental officials, and other sources, who have access to relevant data to provide accurate information for the Official Statement, and the Municipal Advisor has not been engaged, nor has it undertaken, to independently verify the accuracy of such information. The Municipal Advisor is not a public accounting firm and has not been engaged by the

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District to compile, review, examine or audit any information in the Official Statement in accordance with accounting standards. The Municipal Advisor is an independent advisory firm and is not engaged in the business of underwriting, trading or distributing municipal securities or other public securities and therefore will not participate in the underwriting of the Bonds. Requests for information concerning the District should be addressed to PFM Financial Advisors LLC, 50 South Sixth Street, Suite 2250, Minneapolis, Minnesota 55402 (612/338-3535) or 1726 Prairie Lane, Fargo, North Dakota 58103 (701/235-4416).

NOT QUALIFIED TAX-EXEMPT OBLIGATIONS The Bonds will not be designated as “Qualified Tax-Exempt Obligations” for purpose of Section 265 of the Internal Revenue Code of 1986, as amended.

LEGAL MATTERS Legal matters incident to the authorization and issuance of the Bonds are subject to the opinion of Arntson Stewart Wegner PC, Fargo, North Dakota, Bond Counsel, as to validity and tax exemption. Bond Counsel has not participated in the preparation of this Official Statement.

LITIGATION There is no litigation now pending or, to the knowledge of the District officials, threatened which questions the validity of the Bonds or of any proceedings of the District taken with respect to the issuance or sale thereof.

MISCELLANEOUS Any statements made in this Official Statement involving matters of opinion or of estimates, whether or not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that any of the estimates will be realized. The execution and delivery of this Official Statement has been duly authorized by the District. RICHLAND PUBLIC SCHOOL DISTRICT NO. 44 By: /s/ Superintendent

APPENDIX A

The District’s Audited Financial Statements For the Year Ended June 30, 2019

(This page has been left blank intentionally.)

RICHLAND PUBLIC SCHOOL DISTRICT NO. 44Colfax, North Dakota

AUDITED FINANCIAL STATEMENTSYear Ended June 30, 2019


TABLE OF CONTENTSJune 30, 2019

Page(s)

Official Directory 1

INDEPENDENT AUDITOR’S REPORT 2 – 4

Management’s Discussion and Analysis 5 – 10

BASIC FINANCIAL STATEMENTS

Statement of Net Position 11

Statement of Activities 12

Balance Sheet – Governmental Funds 13

Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position 14

Statement of Revenues, Expenditures, and Changes in Fund Balance – Governmental Funds 15

Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balance to the Statement of Activities 16

Statement of Fiduciary Assets and Liabilities – Agency Funds 17

Notes to Financial Statements 18 – 40

REQUIRED SUPPLEMENTARY INFORMATION

Budgetary Comparison Schedule – General Fund 41

Pension Schedules42 – 44

Notes to Required Supplementary Information45

SUPPLEMENTARY INFORMATION

Nonmajor Governmental Funds – Combining Balance Sheet 46

Nonmajor Governmental Funds – Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance 47

Schedule of Receipts and Disbursements – Activity Fund48

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 49 – 50

Schedule of Findings and Questioned Costs 51 – 52

Summary Schedule of Prior Audit Findings 53


OFFICIAL DIRECTORYJune 30, 2019

1

Nathan Berseth President

Craig Olson Vice-President

Nicole Holdman Board Member

Jody Lingen Board Member

Amy Lehmann Board Member

Todd Johnson Board Member

Scott Hendrickson Board Member

Dean Koppelman Superintendent

Kendra Dockter Business Manager

2

Nadine Julson, LLC

506 Dakota Ave. Wahpeton, ND 58075 www.julsoncpa.com T 701.642.8146 F 701.642.8165

INDEPENDENT AUDITOR’S REPORT

School BoardRichland Public School District No. 44Colfax, North Dakota

Report on the Financial Statements

We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Richland Public School District No. 44, as of and for the year ended June 30, 2019, and the related notes tofinancial statements, which collectively comprise Richland Public School District No. 44’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements

Richland Public School District No. 44’s 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 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.

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Nadine Julson, LLC

Opinions

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the Richland Public School District No. 44, as of June 30, 2019 and the respective changes in financial position 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 schedule – general fund, schedules of employer’s proportionate share of net pension liability, schedules of employer contributions, and notes to required supplementary information 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 Richland Public School District No. 44's basic financial statements. The nonmajor governmental funds – combining balance sheet, nonmajor governmental funds – schedule of revenues, expenditures, and changes in fund balance, and schedule of receipts and disbursements – activity fund are presented for purposes of additional analysis and are not a required part of the basic financial statements.

The nonmajor governmental funds – combining balance sheet, nonmajor governmental funds – schedule of revenues, expenditures, and changes in fund balance, and schedule of receipts and disbursements – activity fund are the responsibility of management and were 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 nonmajor governmental funds – combining balance sheet, nonmajor governmental funds – schedule of revenues, expenditures, and changes in fund balance, and schedule of receipts and disbursements – activity fund are fairly stated, in all material respects, in relation to the basic financial statements as a whole.

The official directory has not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on them.

4

Nadine Julson, LLC

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated December 3, 2019 on our consideration of Richland Public School District No. 44’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 Richland Public School District No. 44’s internal control over financial reporting and compliance.

Nadine Julson, LLCWahpeton, North DakotaDecember 3, 2019


MANAGEMENT’S DISCUSSION AND ANALYSISJune 30, 2019

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The Management’s Discussion and Analysis (MD&A) of Richland Public School District No. 44’s financial performance provides an overall review of the District's financial activities for the fiscal year ended June 30, 2019, with comparative data for the fiscal year ended June 30, 2018. The intent of the MD&A is to look at the District’s financial performance as a whole. It should, therefore, be read in conjunction with the basic financial statements and related notes.

Financial Highlights

Key financial highlights for the year ended June 30, 2019 are as follows:

Interest has been a huge help in our budget this past year. With a budget amount of $9,000 we were pleased to see that line exceed by $17,000. In a year that was projected to be deficit spending, this unexpected income helped us tremendously. While there was no account that really stuck out for unencumbered expenses, we were able to save about 1% which also aided our reserve fund balance with $36,000. Within the 1% unspent budget we also accounted for an unexpected early retirement that was approved at a reduced rate and paid out in one payment in June 2019. A large expense that sticks out compared to other years will be the General Administration Services. With a loss of administration in spring of 2018, the board hired a temporary superintendent for the 2018-2019 year at a premium.

Using this Annual Report

This annual financial report consists of a series of statements and related footnotes. These statements are organized so that the reader can understand the Richland Public School District No. 44 as a financial whole. The statements then proceed to provide an increasingly detailed look at specific financial activities.

The Statement of Net Position and Statement of Activities provide information about the activities of the whole District, presentingboth an aggregate view of the District's finances and a longer-term view of those finances. Fund financial statements provide the next level of detail. These statements tell how services were financed in the short-term as well as what remains for future spending. The fund financial statements also look at the District’s general fund with all other governmental funds presented in total in one column.

Reporting on the District as a Whole

Statement of Net Position and Statement of Activities

These statements are summaries of all the funds used by the Richland Public School District No. 44 to provide programs and activities and attempt to answer the question “How did the District do financially during the year ended June 30, 2019?”

The Statement of Net Position presents information on all the District’s assets and liabilities, with the difference between the two reported as net position. Over time, increases and decreases in net position may serve as a useful indicator of whether the financial position of the District is improving or deteriorating.

The Statement of Activities presents information on how the District’s net position changed during the fiscal year. This statement is presented using the accrual basis of accounting, which means that all changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in the statement for some items that will only result in cash flows in future fiscal periods (for example, uncollected taxes).

These two statements report the District’s net position and changes in net position. The change in net position is important because it tells the reader whether, for the District as a whole, the financial position of the District has improved or deteriorated. The causes of this change may be the result of many factors, some financial and some not.

RICHLAND PUBLIC SCHOOL DISTRICT NO. 44Management’s Discussion and Analysis - Continued

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In the Statement of Net Position and the Statement of Activities, the District reports governmental activities. Governmental activities are the activities where most of the District’s programs and services are reported including, but not limited to, regular instruction, federal programs, special education, vocational education, administration, food services, operation and maintenance of buildings and grounds, student transportation, and co-curricular activities.

The government-wide financial statements can be found on pages 11-12 of this report.

Reporting on the District's Most Significant Funds

Balance Sheet - Governmental Funds

The District uses separate funds to account for and manage money dedicated for particular purposes (e.g. taxes collected from special mill levies and funds received from grants and donations). The fund basic financial statements allow the District to demonstrate its stewardship over the accountability for resources provided by taxpayers and other entities. Fund financial statements provide detailed information about the District’s major funds. Using the criteria established by GASB Statement No. 34, the District’s general fund, capital projects, and debt service fund are considered a “major fund."

The District’s other funds, food service, capital projects, and special reserve fund, are used to account for a multitude of financial transactions and is summarized under the heading “Other Governmental Funds”.

The basic governmental fund financial statements can be found on pages 13-16 of this report.

In addition, the District has the following fund type:

Fiduciary Funds

Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds arenot reflected in the government-wide financial statements because the resources of those funds are not available to support the Richland Public School District No. 44’s own programs.

The basic fiduciary fund financial statements can be found on page 17 of this report.

Notes to Financial Statements

The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to financial statements can be found on pages 18-40 of this report.

The combining statements referred to earlier in connection with non-major government funds can be found on pages 46-47 of this report.

Financial Analysis of the District as a Whole

Table I provides a summary of the District’s net position as of June 30, 2019 and 2018. As noted earlier, net position may serve over time as a useful indicator of a government's financial position. In the case of the Richland Public School District No. 44, net position increased by $97,612 for the year ending June 30, 2019.

The District’s net position at June 30, 2019 is segregated into three separate categories. Net position invested in capital assets (net of related debt) are not available for future spending. Restricted net position represents resources that are subject to external restrictions on how they must be spent. The remaining unrestricted net positions are available to meet the District’s ongoing obligations.


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2019 2018

Assets and Deferred Outflows of Resources

Current Assets 1,382,059$ 1,484,070$

Capital Assets, net of depreciation 8,939,924 9,263,366

Deferred Outflows of Resources 760,197 881,649

Total Assets and Deferred Outflows of Resources 11,082,180 11,629,085

Liabilities and Deferred Inflows of Resources

Current Liabilities 495,110 573,966

Long-term Liabilities 8,918,008 9,596,586

Deferred Inflows of Resources 506,452 393,535

Total Liabilities and Deferred Inflows of Resources 9,919,570 10,564,087

Net Position

Net Investment in Capital Assets 3,275,443 3,045,030

Restricted 350,501 337,632

Unrestricted (Deficit) (2,463,334) (2,317,664)

Total Net Position 1,162,610$ 1,064,998$

Table I

Net Position

June 30,

Table II shows the changes in net position for the fiscal years ended June 30, 2019 and 2018.

2019 2018

Revenues

Program Revenues

Charges for Services 137,334$ 136,640$

Operating Grants and Contributions 350,312 385,339

General Revenues

Property Taxes 1,407,480 1,289,449

State Aid-Unrestricted 2,507,091 2,647,463

Interest and Miscellaneous Earnings 30,534 15,834

Total Revenues 4,432,751$ 4,474,725$

Table II

Changes in Net Position

Years Ended June 30,


8

2019 2018

Expenses

Regular Instruction 2,286,808$ 2,360,419$

Special Instruction 261,018 244,237

Vocational Instruction 207,575 193,056

Pupil Services 118,252 100,798

General Administration Services 245,085 191,908

School Administration Services 151,343 291,524

Operation and Maintenance 414,202 370,479

Pupil Transportation 222,376 220,961

Student Activities 141,361 165,134

School Food Services 147,260 169,979

Community Services 28,437 38,846

Interest and Other Charges 111,422 131,401

Total Expenses 4,335,139 4,478,742

Change in Net Position 97,612$ (4,017)$

Table II

Changes in Net Position


Unrestricted state aid constituted 56.6%, property tax 31.8%, operating grants and contributions 7.9%, and charges for services 3.1%of the total revenues of governmental activities of the District for the fiscal year ended June 30, 2019.

Regular instruction constituted 52.8%, operation and maintenance 9.6%, special instruction 6.0%, and general administration 5.7%of total expenses for governmental activities during the fiscal year ended June 30, 2019.

The Statement of Activities shows the cost of program services and the charges for services and grants offsetting those services. Table III shows the total cost of services and the net cost of services. That is, it identifies the cost of these services supported by tax revenue and other unrestricted revenues.

2019 2018 2019 2018

Regular Instruction 2,286,808$ 2,360,419$ 2,162,729$ 2,216,941$

Special Instruction 261,018 244,237 261,018 244,237

Vocational Instruction 207,575 193,056 207,575 183,055

Pupil Services 118,252 100,798 118,252 100,798

General Administration Services 245,085 191,908 245,085 191,908

School Administration Services 151,343 291,524 151,343 291,524

Operation and Maintenance 414,202 370,479 414,202 370,479

Pupil Transportation 222,376 220,961 11,970 3,136

Student Activities 141,361 165,134 141,361 165,134

School Food Services 147,260 169,979 (5,901) 19,304

Community Services 28,437 38,846 28,437 38,846

Interest and Other Charges 111,422 131,401 111,422 131,401

Total Expenses 4,335,139$ 4,478,742$ 3,847,493$ 3,956,763$

Total and Net Cost of Services


Table III

Total Cost Net Cost


9

Financial Analysis of the Governmental Funds

The purpose of the District’s governmental funds is to provide information on the near-term inflows, outflows, and balances of available resources. Unreserved fund balance generally can be used as a measure of the District’s net resources available for spending as of the end of the fiscal year. These funds are accounted for using the modified accrual basis of accounting.

The District’s governmental funds had total revenue of $4,457,701 and expenditures of $4,502,970 for the fiscal year ended June 30, 2019. The unassigned fund balance of the District’s general fund was $969,244.

General Fund Budgetary Highlights

During the year, revenues were more than budgetary estimates by $27,255, expenditures were less than budgetary estimates by$70,402 and ending fund balance was more than budgetary estimates by $127,657.

Additional information on the Richland Public School District No. 44 budget can be found in Note 2 of the audited financial statements that follow this analysis.

Capital Assets

As of June 30, 2019, the Richland Public School District No. 44 had $8,939,924 invested in capital assets. Table IV shows the balances at June 30, 2019 and 2018.

2019 2018

Land 92,000$ 92,000$

Buildings and Improvements 8,732,806 9,012,348

Vehicles 113,164 155,108

Equipment 1,954 3,910

Total Capital Assets 8,939,924$ 9,263,366$

Table IV

(Net of Accumulated Depreciation)


Capital Assets

This total represents a net decrease of $323,442 in capital assets from the prior fiscal year. For a detailed breakdown of the additions and deletions to capital assets, readers are referred to Note 8 of the audited financial statements that follow this analysis.

Debt Administration

As of June 30, 2019, the Richland Public School District No. 44 had $5,664,481 of total debt, a net decrease of $553,855 from the previous fiscal year.


10

2019 2018 2019 2018

General Obligation Bonds Payable 2,570,000$ 2,825,000$ 255,000$ 255,000$

State School Construction Bonds Payable 3,094,481 3,393,336 206,937 251,841

Total 5,664,481$ 6,218,336$ 461,937$ 506,841$

Total Outstanding Due Within One Year

Table V

O utstanding Debt


For additional information regarding the outstanding debt, readers are referred to Note 9 of the audited financial statements that follow this analysis.

For the Future

With 2018-2019 being a year of healing for Richland #44 we are excited to see what the future brings for us. A change in administration that is worth noting will be the combined position of High School Principal and Superintendent. While this will be a cost saving measure, it was also seen as a reasonable combination for a school our size. A few other positions also will see change in the coming year. For the past few years we have been fortunate to have one of our special education positions filled by a resident teacher. However, residency has come to an end and the resident teacher will now be on a teacher contract with our school. We have also added a second, full time counselor, a 40% science teacher at the high school, and a reading interventionist. These positions are all under teacher contracts and will affect our budget. Enrollment appears to be steady for the near future. Several new houses are being built in our communities and this brings hope to our board for increased enrollment. As shared with our patrons, the board will look to keep the mill number the same and stay at 62 general fund mills if at all possible.

Contacting the Districts Financial Management

This financial report is designed to provide our parents, taxpayers and creditors with a general overview of the Richland Public School District No. 44’s finances and to show the District’s accountability for the money it receives to provide the best possible education to all students enrolled in Richland Public School District No. 44. Anyone who has questions about information contained in this report or who is interested in receiving additional information is encouraged to contact Kendra Dockter at 101 Main Street, Colfax, North Dakota, 58018, 701-372-3713.


STATEMENT OF NET POSITIONJune 30, 2019

See Notes to Financial Statements

11

ASSETS

Current Assets

Cash and Cash Equivalents 1,237,424$

Accounts Receivable 2,046

Due from County 7

Due from Federal Government 89,129

Taxes Receivable 53,453

Total Current Assets 1,382,059

Capital Assets

Non-depreciable

Land 92,000

Depreciable, net of accumulated depreciation

Buildings and Improvements 8,732,806

Vehicles 113,164

Equipment 1,954

Total Capital Assets 8,939,924

Total Assets 10,321,983

DEFERRED OUTFLOWS OF RESOURCES

Deferred Outflows Related to Pension and OPEB 760,197

Total Assets and Deferred Outflows of Resources 11,082,180

LIABILITIES

Current Liabilities

Accounts Payable 87

Interest Payable 33,086

Current Potion of Long-term Debt

General Obligation Bonds Payable 255,000

State School Construction Bonds Payable 206,937

Total Current Liabilities 495,110

Due After One Year

General Obligation Bonds Payable 2,315,000

State School Construction Bonds Payable 2,887,544

Compensated Absences 54,069

Pension and OPEB Liability 3,661,395

Total Long-term Liabilities 8,918,008

Total Liabilit ies 9,413,118

DEFERRED INFLOWS OF RESOURCES

Deferred Inflows Related to Pensions and OPEB 506,452

Total Liabilit ies and Deferred Inflows of Resources 9,919,570

NET POSITION

Net Investment in Capital Assets 3,275,443

Restricted 350,501

Unrestricted (Deficit) (2,463,334)

Total Net Position 1,162,610$


STATEMENT OF ACTIVITIESYear Ended June 30, 2019


12

Net (Expense)

Revenue and

Changes in Net

Position

Functions/Programs Expenses

Charges for

Services

Operating Grants

and Contributions

Governmental

Activities

Regular Instruction 2,286,808$ 34,950$ 89,129$ (2,162,729)$

Special Instruction 261,018 - - (261,018)

Vocational Instruction 207,575 - - (207,575)

Pupil Services 118,252 - - (118,252)

General Administration Services 245,085 - - (245,085)

School Administration Services 151,343 - - (151,343)

Operation and Maintenance 414,202 - - (414,202)

Pupil Transportation 222,376 - 210,406 (11,970)

Student Activities 141,361 - - (141,361)

School Food Services 147,260 102,384 50,777 5,901

Community Services 28,437 - - (28,437)

Interest and Other Charges 111,422 - - (111,422)

4,335,139$ 137,334$ 350,312$ (3,847,493)

756,784

535,558

115,138

2,507,091

26,695

3,839

3,945,105

97,612

1,064,998

1,162,610$ Net Position, End of Year

General Revenues

Taxes

Taxes Levied for General Purposes

Total General Revenues

Taxes Levied for Debt Purposes

Program Revenues

Taxes Levied for Building Purposes

State Aid, not restricted for specific purpose

Interest and Investment Earnings

Miscellaneous

Change in Net Position

Net Position, Beginning of Year


BALANCE SHEET – GOVERNMENTAL FUNDSJune 30, 2019


13

General Fund Debt Service Capital Projects

Other

Governmental

Funds

Total

Governmental

Funds

ASSETS

Cash and Cash Equivalents 878,067$ 95,929$ 145,960$ 117,468$ 1,237,424$

Accounts Receivable 2,046 - - - 2,046

Due from County 2 - - 5 7

Due from Federal Government 89,129 - - - 89,129

Taxes Receivable 27,267 20,789 4,420 977 53,453

Total Assets 996,511 116,718 150,380 118,450 1,382,059

LIABILITIES

Accounts Payable - - - 87 87

Total Liabilit ies - - - 87 87


Unavailable Revenue - Property Taxes 27,267 20,789 4,420 977 53,453

Total Deferred Inflows of Resources 27,267 20,789 4,420 977 53,453

FUND BALANCE

Restricted - 95,929 145,960 115,512 357,401

Assigned - - - 1,874 1,874

Unassigned 969,244 - - - 969,244

Fund Balance 969,244 95,929 145,960 117,386 1,328,519

Total Liabilities, Deferred Inflows of

Resources, and Fund Balance 996,511$ 116,718$ 150,380$ 118,450$ 1,382,059$

Major Funds


RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEETTO THE STATEMENT OF NET POSITIONJune 30, 2019


14

1,328,519$

Total net position reported for government activities in the statement of

net position is different because:

Capital assets used in governmental activities are not financial resources

and are not reported in the governmental funds.

Cost of Capital Assets 14,284,322

Less Accumulated Depreciation (5,344,398)

Net Capital Assets 8,939,924

Property taxes receivable will be collected after year-end, but are not

available soon enough to pay for the current period's expenditures and,

therefore, are reported as unavailable revenue in the funds. 53,453

Long-term liabilities applicable to the District 's governmental activities

are not due and payable in the current period and, accordingly, are not

reported as fund liabilit ies. Interest on long-term debt is not accrued in

governmental funds, but rather is recognized as an expenditure when due.

All liabilities, both current and long-term are reported in the statement of

net position. Balances at the end of the year are reported in the

statement of net position.

Interest Payable (33,086)

Compensated Absences (54,069)

General Obligation Bonds Payable (2,570,000)

State School Construction Bonds Payable (3,094,481)

Pension Liability (net of related outflows and inflows) (3,407,650)

Total Long-term Liabilities (9,159,286)

Total Net Position of Governmental Activities 1,162,610$

Total Fund Balance - Governmental Funds


STATEMENT OF REVENUES, EXPENDITURES, AND CHANGESIN FUND BALANCE – GOVERNMENTAL FUNDSYear Ended June 30, 2019


15

General Fund Deb t Service Cap ital Pro jects

Other

Go vernmental

Funds

To tal

Governmental

Funds

REVENUES

Local Sources 774 ,744$ 547,374$ 117,213$ 13 0 ,4 3 3$ 1,569 ,764$

State Sources 2 ,717,497 - - 1,561 2 ,719 ,058

Federal Sources 89 ,129 - - 49 ,216 138 ,3 4 5

Interes t Inco me 2 6 ,6 9 3 - - 2 2 6 ,6 9 5

Miscellaneous Inco me 3 ,8 3 9 - - - 3 ,839

To tal Revenues 3 ,611,9 0 2 547,374 117,213 181,212 4 ,457,701

EXPENDITURES

Current

Regular Ins truct io n 1,9 6 9 ,835 - - - 1,9 6 9 ,8 3 5

Special Ins t ruction 2 6 0 ,517 - - - 260 ,517

Vocat ional Ins t ruct ion 2 0 4 ,3 2 3 - - - 204 ,323

Pup il Services 118 ,252 - - - 118 ,252

General Ad minis t ration Services 244 ,219 - - - 2 4 4 ,2 19

Schoo l Adminis trat io n Services 151,3 4 3 - - - 151,343

Operat io n and Maintenance 393 ,461 - 2 0 ,74 1 - 414 ,202

Pup il Transportation 173 ,112 - - - 173 ,112

Student Activit ies 127,0 99 - - - 127,099

Schoo l Food Services - - - 144 ,194 14 4 ,194

Community Services 28 ,437 - - - 2 8 ,4 3 7

Deb t Service

Principal - 553 ,855 - - 553 ,8 55

Interes t and Other Charg es - 113 ,582 - - 113 ,582

To tal Expend itures 3 ,670 ,598 6 6 7,43 7 2 0 ,74 1 144 ,194 4 ,502 ,970

Exces (Deficiency) o f Revenues

over Exp end itures (58 ,6 9 6 ) (12 0 ,0 6 3 ) 96 ,472 37,018 (45,26 9 )

OTHER FINANCING SOURCES (USES)

Op erat ing Transfer In 3 0 ,0 0 0 - - - 30 ,000

Op erat ing Transfer Out - - - (3 0 ,0 0 0 ) (30 ,0 0 0 )

To tal Other Financing Sources (Uses) 3 0 ,0 0 0 - - (3 0 ,0 0 0 ) -

NET CHANGE IN FUND BALANCE (2 8 ,6 9 6 ) (12 0 ,0 6 3 ) 96 ,472 7,018 (45,26 9 )

FUND BALANCE, BEGINNING OF YEAR 9 9 7,9 40 215,992 49 ,488 110 ,3 68 1,373 ,788

FUND BALANCE, END OF YEAR 9 6 9 ,2 4 4$ 9 5,929$ 145,960$ 117,38 6$ 1,3 2 8 ,519$

Majo r Funds


RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE TO THE STATEMENT OF ACTIVITIESYear Ended June 30, 2019


16

Net Change in Fund Balance - Total Governmental Funds (45,269)$

The change in net position reported for governmental activities in the statement of

activities is different because:

Governmental funds report capital outlays as expenditures. However, in the

statement of activities, the costs of those assets with a cost greater than

$5,000 is allocated over their estimated useful lives and reported as

depreciation expense. This is the amount by which depreciation exceeded

capital outlays in the current year. (323,442)

Some expenses reported in the statement of activities do not require the use of

current financial resources and are not reported as expenditures in governmental

funds.

Net Decrease in Compensated Absences 5,895

Net Increase in Pension Liability (70,637)

Net Decrease in Interest Payable 2,160

(62,582)

Repayment of debt principal and other long-term liabilities is an expenditure in the

governmental fund financial statements, but repayment reduces long-term liabilities

in the statement of net position. 553,855

Some revenues reported on the statement of activities are not reported as

revenues in the governmental funds since they do not represent available

resources to pay current expenditures. This consists of a decrease

in taxes receivable. (24,950)

Change in Net Position of Governmental Activities 97,612$


STATEMENT OF FIDUCIARY ASSETS AND LIABILITIES – AGENCY FUNDSJune 30, 2019


17

Agency Funds

Assets

Cash and Investments 95,898$

Accounts Receivable 2,194

Total Assets 98,092

Liabilities

Due to Groups 98,092

Total Liabilities 98,092$


NOTES TO FINANCIAL STATEMENTSJune 30, 2019

18

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The financial statements of the Richland Public School District No. 44, Colfax, North Dakota (the District) have been prepared in accordance with accounting principles generally accepted in the United States of America as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental accountingand financial reporting principles.

A. Reporting Entity

The accompanying financial statements present the activities of the Richland Public School District No. 44. The District has considered all potential component units for which the District is financially accountable and other organizations for which the nature and significance of their relationships with the District such that exclusion would cause the District’s financial statements to be misleading or incomplete. GASB has set forth criteria to be considered in determining financial accountability. This criterion includes appointing a voting majority of an organization’s governing body and (1) the ability of the Richland Public School District No. 44 to impose its will on that organization or (2) the potential for the organization to provide specific financial benefits to or impose specific financial burdens on Richland Public School District No. 44.

Based on these criteria, there are no component units to be included within the Richland Public School District No. 44 as a reporting entity.

B. Basis of Presentation, Basis of Accounting

Government-wide statements - The statement of net position and the statement of activities display information about the primary government (Richland Public School District No. 44). These statements include the financial activities of the overall government, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. Governmental activities generally are financed through taxes, intergovernmental revenues, fees and other non-exchange transactions. The statement of activities presents a comparison between direct expenses and program revenues for each function of the District’s governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Program revenues include (a) fees and charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.

Fund financial statements - The fund financial statements provide reports on the financial condition and results of operations for two fund categories - governmental and fiduciary. Since the resources in the fiduciary funds cannot be used for District operations, they are not included in the district-wide statements. The District considers some governmental funds major and reports their financial condition and results of operations in a separate column. All remaining governmental funds are aggregated and reported as nonmajor funds.

The District reports the following major governmental funds:

1. General Fund – The General Fund is the District's primary operating fund. It accounts for all financial resources except those required to be accounted for in another fund.

2. Debt Service Fund – Used to account for the accumulation of resources for, and payment of, general obligation bond principal, interest, and related costs.

3. Capital Projects Fund – Used to account for financial resources related to capital outlays made by the District.

RICHLAND PUBLIC SCHOOL DISTRICT NO. 44Notes to Financial Statements – Continued

19

Additionally, the District reports the following governmental fund types that are included in non-major funds:

1. Governmental Funds

a. Special Reserve Fund – Used to account for resources restricted to, or designated for, specific purposes by the District.

b. Food Service Fund – Used to account for food service revenues and expenditures.

2. Fiduciary Funds

a. Agency Funds – Used to account for resources held for others in a custodial capacity, the District's Agency Fund is the Student Activity Fund.

C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation

Government-wide and Fiduciary Fund Financial Statements - The government-wide and fiduciary fund financial statements are reported using the economic resources measurement focus. The government-wide financial statements are reported using the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the District gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, grants, entitlements and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from grants, entitlements and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied.

Government Fund Financial Statements - Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The District considers all revenues reported in the governmental funds to be available if the revenues are collected within sixty days after year-end. All revenues are considered to be susceptible to accrual. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured. General capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term debt and acquisitions under capital leases are reported as other financing sources.

Under the terms of grant agreements, the District funds certain programs by a combination of specific cost-reimbursement grants and general revenues. Thus, when program expenses are incurred, there are both restricted and unrestricted net assets available to finance the program. It is the District’s policy to first apply cost-reimbursement grant resources to such programs, and then by general revenues.

When both restricted and unrestricted resources are available for use, it is the District's policy to use restricted resources first, then unrestricted resources, as they are needed.

D. Cash and Investments

Cash includes amounts in demand deposits and money market accounts. Cash equivalents on the statement of cash flows consist of certificates of deposit with a maturity of three months or less. Deposits must either be deposited with the Bank of North Dakota or in other financial institutions situated and doing business within the state. Deposits, other than with the Bank of North Dakota, must be fully insured or bonded. In lieu of a bond, a financial institution may provide a pledge of securities equal to 110% of the uninsured balance.


20

E. Capital Assets

Capital assets include land, buildings, and equipment. Assets are reported in the governmental activities column in thegovernment-wide financial statements. Capital assets are defined by the District as assets with an initial, individual cost of $5,000 ormore. Such assets are recorded at cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets is not capitalized.

Capital assets are depreciated using the straight-line method over the following estimated useful lives:

Assets Years

Building 50Playground equipment/parking lot 25School busses 10Other vehicles 10Office equipment 8 - 10Other equipment 8

F. Vacation Pay, Sick Pay, Severance

The expenditures for vacation pay are recognized when payment is made. Employees are not allowed to carryover unused vacationdays. Upon termination of employment with the District, a certified employee will be entitled to sick pay reimbursement at the rate of$60 per day, for a maximum of 90 days unused, accumulated sick leave. A certified employee will also be entitled to personal leave reimbursement at the rate of $60 per day, for a maximum of eight days of unused, accumulated personal leave. Sick pay for non-certified employees is $30 per day up to three days unused. There is no personal leave reimbursement for non-certified employees.

G. Long-term Obligations

In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the government activities statement of net position. Bond premiums, discounts and issuance costs are recognized in the current period since the amounts are not material. In the fund financial statements, governmental fund types recognize bond premiums, discounts and issuance costs in the current period. The face amount of the debt is reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs are reported as debt service expenditures.

H. Pension Plans

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 Teachers’ Fund for Retirement (TFFR) and the North Dakota Public Employees Retirement System (NDPERS) additions to/deductions from TFFR and NDPERS fiduciary net position have been determined on the same basis as they are reported by TFFR and NDPERS. 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.


21

I. Fund Balance and Net Position

GASB Statement No. 54 established new fund balance classifications that comprise a hierarchy based on the extent to which the government is bound to honor constraints (restriction or limitations) imposed upon the use of the resources reported in governmental funds.

Fund Balance Spending Policy:

It is the policy of the Richland Public School District No. 44 to spend restricted resources first, followed by unrestricted resources. It is also the policy of the Board to spend unrestricted resources of funds in the following order: committed, assigned and then unassigned.

Budget Stabilization Policy:

Replenishing deficiencies - when fund balance falls below the minimum 10 percent range, the District will replenish shortages/deficiencies using the budget strategies and time frames described as follows:

The following budgetary strategies shall be utilized by the District to replenish funding deficiencies:

- The District will reduce recurring expenditures to eliminate any structural deficit; or- The District will increase revenues or pursue funding sources; or- Some combination of the two operations above.

GASB Statement No. 54 Fund Balance Reporting and Governmental Fund Type Definitions

GASB Statement No. 54 “Fund Balance Reporting and Governmental Fund Type Definitions” provides more clearly defined fund balance categories to make the nature and extent of the constraints placed on a government’s fund balance more transparent. The following classifications describe the relative strength of the spending constraints and the purpose for which resources can be used:

CLASSIFICATION DEFINITION EXAMPLES

Nonspendable Amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact.

Inventories, prepaid amounts (expenses), long-term receivables, endowment funds.

Restricted Fund balance is reported as restricted when constraints are placed on the use of resources that are either (a) externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments or (b) imposed by law through constitutional provisions or enabling legislation.

Funds restricted by State Statute, unspent bond proceeds, grants earned but not spent, debt covenants, taxes raised for a specific purpose.


22

CLASSIFICATION DEFINITION EXAMPLES

Committed A committed fund balance includes amounts that can only be used for specific purposes pursuant to constraints imposed byformal action of the government's highest level of decision-making authority, the School Board. Formal action is required to be taken to establish, modify, or rescind a fund balancecommitment.

By board action, construction claims and judgements, retirements of loans and notes payable, capital expenditures, and self-insurance.

Assigned Assigned fund balances are amounts that are constrained by thegovernment's intent to be used for specific purposes, but are under the direction of the board and the business manager.

By board action, construction claims and judgements, retirements of loans and notes payable, capital expenditures, and self-insurance.

Unassigned Unassigned fund balance is the lowest classification for theGeneral Fund. This is a fund balance that has not been reported in any other classification. The General Fund is the only fund that can report a positive unassigned fund balance. A negative unassigned fund balance may be reported in other governmental funds, if expenditures incurred for specific purposes exceed the amounts restricted, committed, or assigned to those purposes.

Available for any remaining general fund expenditure.

Restricted Fund Balance

1. Special Revenue Funda. Fund used for special uses as restricted by state law. In accordance with NDCC 57-19-01, the ending fund balance is

limited to the amount generated by fifteen (15) mills times the taxable valuation of the District. Restricted by enabling legislation and tax levy.

2. Debt Service Funda. Fund used for the payment of principal and interest. Restricted by enabling legislation, tax levy, and bond indenture.

3. Capital Projects Funda. Fund used for capital asset acquisition or expenditure. Restricted by enabling legislation, tax levy, and bond indenture.

Assigned Fund Balance

1. Food Service Funda. Restricted state and federal resources are spent first and reimbursed by each year-end. Any remaining fund balance is

normally left in the food service fund at each year-end, but may be spent at the discretion of the business manager(authority given from the governing board). Assigned by federal and state reimbursements for free and reduced meals and grants.


23

Unassigned Fund Balance

1. General Funda. Consists of the amount reported in the General Fund at year-end.

Net Position

The District implemented the provisions of GASB Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position during the year ended June 30, 2013.

When both restricted and unrestricted resources are available for use, it is the District's policy to use restricted resources first, then unrestricted resources as they are needed.

Net Investment in capital assets is reported for capital assets less accumulated depreciation and any related debt used to construct them. The resources needed to repay this related debt must be provided from other sources, since capital assets are not used to liquidate these liabilities. These assets are not available for future spending.

Restrictions of net position, shown in the Statement of Net Position, are due to restricted tax levies and bond indenture capital construction requirements for capital projects and special purposes. Unrestricted net position is primarily unrestricted amounts related to the general fund and any negative fund balances. The unrestricted net position is available to meet the District’s ongoingobligations.

J. Interfund Transactions

In the governmental fund statements, transactions that constitute reimbursements to a fund for expenditures initially made from it that are properly applicable to another fund, are recorded as expenditures in the reimbursing fund and as reductions of expenditures in the fund that is reimbursed.

All other interfund transactions, except reimbursements, are reported as transfers. Nonrecurring or nonroutine permanent transfers of equity are reported as residual equity transfers. All other interfund transfers are reported as operating transfers. In thegovernment-wide financial statements, interfund transactions have been eliminated.

NOTE 2 – LEGAL COMPLIANCE – BUDGETS

Expenditures over Appropriations – General fund expenditures were less than appropriations by $70,402 for the year ended June 30, 2019. Expenditures for regular instruction and pupil transportation were less than budgeted amounts during the fiscal year.

NOTE 3 – DEPOSITS AND INVESTMENTS

In accordance with North Dakota Statutes, the District maintains deposits at the depository banks designed by the governing board. All depositories are members of the Federal Reserve System.

Deposits must either be deposited with the Bank of North Dakota or in other financial institutions situated and doing business within the state. Deposits, other than with the Bank of North Dakota, must be fully insured or bonded. In lieu of a bond, a financial institution may provide a pledge of securities equal to 110% of the deposits not covered by insurance or bonds.

Authorized collateral includes bills, notes, or bonds issued by the United States government, its agencies or instrumentalities, all bonds and notes guaranteed by the United States government, Federal land bank bonds, notes, warrants, certificates of indebtedness, insured certificates of deposit, shares of investment companies registered under the Investment Companies Act of 1940, and all other forms of securities issued by the State of North Dakota, its boards, agencies or instrumentalities or by any county, city, township, school district, park district, or other political subdivision of the State of North Dakota whether payable from special revenues or supported by the full faith and credit of the issuing body and bonds issued by another state of the United States or such other securities approved by the banking board. At year end June 30, 2019, the District’s carrying amounts of deposits was $1,333,322 and the bank balances were $1,817,322. Of the bank balances, $250,000 was covered by Federal Depository Insurance. The remaining bank balances were collateralized with an irrevocable standby letter of credit held by the pledging financial institution’s agent in the District’s name.


24

Credit Risk:

The District may invest idle funds as authorized in North Dakota Statues, as follows:

1. Bonds, treasury bills and notes, or other securities that are a direct obligation insured or guaranteed by the Treasury of the United States, or its agencies, instrumentalities, or organizations created by an act of congress.

2. Securities sold under agreements to repurchase written by a financial institution in which the underlying securities for the agreement to repurchase are the type listed above.

3. Certificates of Deposit fully insured by the Federal Deposit Insurance Corporation.

4. Obligations of the state.

As of June 30, 2019, the District held no certificates of deposit.

Interest Rate Risk:

The District does not have a formal deposit policy that limits maturities as a means of managing exposure to fair-value losses arising from increasing interest rates.

Concentration of Credit Risk:

The District does not have a limit on the amount it may invest in any one issuer.

NOTE 4 – TAXES RECEIVABLE

The taxes receivable represents the past five years of uncollected current and delinquent taxes. No allowance has been established for uncollectible taxes receivable.

The county treasurer acts as an agent to collect property taxes levied in the county for all taxing authority. Any material tax collections are distributed after the end of each month.

Property taxes are levied as of January 1. The property taxes attach as an enforceable lien on property on January 1 and may be paid in two installments. The first installment includes one-half of the real estate taxes and all the special assessments and the second installment is the balance of the real estate taxes. The first installment is due by March 1 and the second installment is due by October15. A 5% discount on property taxes is allowed if all taxes and special assessments are paid by February 15. After the due dates, the bill becomes delinquent and penalties are assessed.

Most property owners choose to pay property taxes and special assessments in a single payment on or before February 15 and receive the discount on the property taxes.

NOTE 5 – ACCOUNTS RECEIVABLE

Accounts receivable consists of amounts for accrued interest and amounts on open account from other school districts andorganizations for goods and services furnished by the District. No allowance has been established for uncollectible accounts.

NOTE 6 – DUE FROM COUNTY

Due from county represents the amount of taxes collected prior to year-end that are distributed to the District shortly after June 30, 2019.

NOTE 7 – DUE FROM FEDERAL GOVERNMENT

The amount due from federal government consists of a reimbursement claim for various Title Programs. This claim is passed through the state.


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NOTE 8 – CAPITAL ASSETS

The following is a summary of changes in capital assets for the year ended June 30, 2019:

Balance

July 1, 2018 Additions Retirements

Balance

June 30, 2019

Governmental Activities:

Capital Assets, not being depreciated:

Land 92,000$ -$ -$ 92,000$

Total Capital Assets, not being depreciated 92,000 - - 92,000

Capital Assets, being depreciated

Buildings and Improvements 13,355,361 - - 13,355,361

Vehicles 730,317 - - 730,317

Equipment 106,644 - - 106,644

Total Capital Assets, being depreciated 14,192,322 - - 14,192,322

Less Accumulated Depreciation for:

Buildings and Improvements 4,343,013 279,542 - 4,622,555

Vehicles 575,209 41,944 - 617,153

Equipment 102,734 1,956 - 104,690

Total Accumulated Depreciation 5,020,956 323,442 - 5,344,398

Total Capital Assets Being Depreciated, net 9,171,366 (323,442) - 8,847,924

Governmental Activities Capital Assets, net 9,263,366$ (323,442)$ -$ 8,939,924$

Depreciation expense was charged to functions/programs of the District as follows:

Governmental Activities:

Regular Instruction 252,231$

Special Instruction 501

Vocational Instruction 3,252

General Administration Services 866

Pupil Transportation 49,264

Student Activities 14,262

School Food Services 3,066

Total Depreciation Expense - Governmental Activities 323,442$


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NOTE 9 – LONG-TERM LIABILITIES

During the year ended June 30, 2019, the following changes occurred in liabilities reported in long-term liabilities:

Long-term

Liabilites at

July 1, 2018 Increases Decreases

Long-term

Liabilites at

June 30, 2019

Due Within

One Year

Governmental Activities

General Obligation Bonds Payable 2,825,000$ -$ (255,000)$ 2,570,000$ 255,000$

State School Construction Bonds Payable 3,393,336 - (298,855) 3,094,481 206,937

Compensated Absences* 59,964 - (5,895) 54,069 -

Pension and OPEB Liability* 3,825,127 - (163,732) 3,661,395 -

Total - Governmental Activities 10,103,427$ -$ (723,482)$ 9,379,945$ 461,937$

*The change in compensated absences and pension and OPEB liability is shown as a net change because changes in salary prohibit exact calculations of additions and reductions.

Outstanding debt at June 30, 2019, are comprised of the following individual issues:

1. ND State Construction Bonds, Series 2013 - From an original issuance of $4,292,740 at an interest rate of 1.00%, $3,094,481remains outstanding. The principal and interest are payable through June 1, 2033.

2. General Obligation Refunding Bonds, Series 2013B - From an original issuance of $725,000, at rates of 1.35% - 1.65%,$120,000 remains outstanding. The principal and interest are payable through August 1, 2019.

3. General Obligation Refunding Bonds, Series 2013A - From an original issuance of $1,605,000, at rates of 3.00% - 4.00%,$1,605,000 remains outstanding. The principal and interest are payable through August 1, 2033.

4. General Obligation Refunding Bonds, Series 2016 - From an original issuance of $1,100,000 at rates of 1.40% - 2.00%,$845,000 remains outstanding. Principal and interest are payable through August 1, 2023.

The debt service requirements are as follows:

Year Ending June 30, Rate Principal Interest Payment

2020 1.00% 206,937$ 30,932$ 237,869$

2021 1.00% 209,006 28,862 237,868

2022 1.00% 211,096 26,772 237,868

2023 1.00% 213,207 24,661 237,868

2024 1.00% 215,339 22,529 237,868

2025-2029 1.00% 1,109,432 79,912 1,189,344

2030-2033 1.00% 929,464 23,319 952,783

Totals 3,094,481$ 236,987$ 3,331,468$

ND State Construction Bonds, Series 2013

(Dated August 1, 2013, Due annually to June 1, 2033)

(Interest paid annually on June 1st)

The bonds are subject to prior redemption on any date at a price of par plus accrued interest.


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2020 1.65% 120,000$ 990$ 120,990$

Totals 120,000$ 990$ 120,990$

General Obligation Bonds Payable, Series 2013B

(Dated September 10, 2013, Due serially to August 1, 2019)

(Interest paid semiannually on August and February 1)

The bonds are not subject to redemption prior to their actual maturities.


2020 3.00% -$ 59,237$ 59,237$

2021 3.00% - 59,237 59,237

2022 3.00% - 59,237 59,237

2023 3.00% - 59,237 59,237

2024 3.00% - 59,237 59,237

2025-2029 3.00 - 3.70% 730,000 239,577 969,577

2030-2034 4.00% 875,000 90,297 965,297

Totals 1,605,000$ 626,059$ 2,231,059$


General Obligation Bonds Payable, Series 2013A

(Dated September 10, 2013, Due serially to August 1, 2033)

The bonds are subject to optional redemption on August 2, 2021 and any date thereafter at a price of par plus accrued interest to the redemption date.


2020 2.00% 135,000$ 10,650 145,650$

2021 1.20% 135,000 8,490 143,490

2022 1.20% 185,000 6,570 191,570

2023 1.40% 195,000 4,095 199,095

2024 1.40% 195,000 1,365 196,365

Totals 845,000$ 31,170$ 876,170$

General Obligation Bonds Payable, Series 2016

(Dated August 1, 2016 Due serially to August 1, 2023)


The bonds are subject to optional redemption at a price of par plus accrued interest to the redemption date.


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NOTE 10 – DEFERRED INFLOWS OF RESOURCES

Deferred inflows of resources in the fund financial statements consist of amounts for which asset recognition criteria have been met. Under the modified accrual basis of accounting, such amounts are measurable but not available and include taxes receivables of$53,453. Deferred inflows of resources on the statement of net position consist of related pension expense of $506,452.

NOTE 11 – DEFERRED OUTFLOWS OF RESOURCES

Deferred outflows of resources in the fund financial statements consist of amounts for which liability recognition criteria have been met, but for which expense recognition criteria have not been met. Under the modified accrual basis of accounting, such amounts are measurable but not available. Deferred outflows of resources on the statement of net position consist of related pension expense of$760,197.

NOTE 12 – RISK MANAGEMENT

The District is exposed to various risks of loss relating to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters.

In 1986, state agencies and political subdivisions of the State of North Dakota joined together to form the North Dakota Insurance Reserve Fund (NDIRF), a public entity risk pool currently operating as a common risk management and insurance program for thestate and over 2,000 political subdivisions. The District pays an annual premium to NDIRF for its general liability, auto and public assets insurance coverage. The coverage by NDIRF is limited to losses of $2,000,000 per occurrence for general liability and auto coverage.

The District also participates in the North Dakota Fire and Tornado Fund and the State Bonding Fund. The District pays an annual premium to the Fire and Tornado Fund to cover property damage to buildings and personal property. Replacement cost coverage is provided by estimating replacement cost in consultation with the Fire and Tornado Fund. The Fire and Tornado Fund is reinsured by a third-party insurance carrier for losses in excess of $2,000,000 per occurrence during a twelve-month period. The State Bonding Fund currently provides political subdivision with blanket fidelity bond coverage in the amount of $1,600,000 for its employees. The State Bonding Fund does not currently charge any premium for this coverage.

The District participates in the North Dakota Workforce Safety & Insurance and purchases commercial insurance for employee health and boiler and machinery insurance. Settled claims resulting from these above risks have not exceeded insurance coverage in any of the past three fiscal years.

The District has elected to be self-insured and retain all risk for liabilities resulting from claims of unemployment benefits. During the year ended June 30, 2019, no claims were filed for unemployment benefits.

NOTE 13 – PENSION PLANS

North Dakota Teacher's Fund for Retirement

The following brief description of TFFR is provided for general information purposes only. Participants should refer to NDCC Chapter 15-39.1 for more complete information.

TFFR is a cost-sharing multiple-employer defined benefit pension plan covering all North Dakota public teachers and certain other teachers who meet various membership requirements. TFFR provides for pension, death and disability benefits. The cost to administer the TFFR plan is financed by investment income and contributions.

Responsibility for administration of the TFFR benefits program is assigned to a seven-member Board of Trustees (Board). The Board consists of the State Treasurer, the Superintendent of Public Instruction, and five members appointed by the Governor. The appointed members serve five-year terms which end on June 30 of alternate years. The appointed Board members must include two active teachers, one active school administrator, and two retired members. The TFFR Board submits any necessary or desirable changes in statutes relating to the administration of the fund, including benefit terms, to the Legislative Assembly for consideration. The Legislative Assembly has final authority for changes to benefit terms and contribution rates.


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Pension Benefits

For purposes of determining pension benefits, members are classified within one of three categories. Tier 1 grandfathered and Tier 1 non-grandfathered members are those with service credit on file as of July 1, 2008. Tier 2 members are those newly employed and returning refunded members on or after July 1, 2008.

Tier 1 Grandfathered

A Tier 1 grandfathered member is entitled to receive unreduced benefits when three or more years of credited service as a teacher in North Dakota have accumulated, the member is no longer employed as a teacher and the member has reached age 65, or the sum ofage and years of service credit equals or exceeds 85. TFFR permits early retirement from ages 55 to 64, with benefits actuarially reduced by 6% per year for every year the member’s retirement age is less than 65 years or the date as of which age plus service equal85. In either case, benefits may not exceed the maximum benefits specified in Section 415 of the Internal Revenue Code

Pension benefits paid by TFFR are determined by NDCC Section 15-39.1-10. Monthly benefits under TFFR are equal to the three highest annual salaries earned divided by 36 months and multiplied by 2.00% times the number of service credits earned. Retirees may elect payment of benefits in the form of a single life annuity, 100% or 50% joint and survivor annuity, ten or twenty-year term certain annuity, partial lump-sum option or level income with Social Security benefits. Members may also qualify for benefits calculated under other formulas.

Tier 1 Non-Grandfathered

A Tier 1 non-grandfathered member is entitled to receive unreduced benefits when three or more years of credited service as a teacher in North Dakota have accumulated, the member is no longer employed as a teacher and the member has reached age 65, or has reached age 60 and the sum of age and years of service credit equals or exceeds 90. TFFR permits early retirement from ages 55 to 64, with benefits actuarially reduced by 8% per year from the earlier of age 60/Rule of 90 or age 65. In either case, benefits may not exceed the maximum benefits specified in Section 415 of the Internal Revenue Code.

Pension benefits paid by TFFR are determined by NDCC Section 15-39.1-10. Monthly benefits under TFFR are equal to the three highest annual salaries earned divided by 36 months and multiplied by 2.00% times the number of service credits earned. Retirees may elect payment of benefits in the form of a single life annuity, 100% or 50% joint and survivor annuity, ten or twenty-year term certain annuity, partial lump-sum option or level income with Social Security benefits. Members may also qualify for benefits calculated under other formulas.

Tier 2

A Tier 2 member is entitled to receive unreduced benefits when five or more years of credited service as a teacher in North Dakota have accumulated, the member is no longer employed as a teacher and the member has reached age 65, or has reached age 60 and the sum of age and years of service credit equals or exceeds 90. TFFR permits early retirement from ages 55 to 64, with benefits actuarially reduced by 8% per year from the earlier of age 60/Rule of 90 or age 65. In either case, benefits may not exceed the maximum benefits specified in Section 415 of the Internal Revenue Code.

Pension benefits paid by TFFR are determined by NDCC Section 15-39.1-10. Monthly benefits under TFFR are equal to the five highest annual salaries earned divided by 60 months and multiplied by 2.00% times the number of service credits earned. Retirees may elect payment of benefits in the form of a single life annuity, 100% or 50% joint and survivor annuity, ten or twenty-year term certain annuity, partial lump-sum option or level income with Social Security benefits. Members may also qualify for benefits calculated under other formulas.

Death and Disability Benefits

Death benefits may be paid to a member’s designated beneficiary. If a member’s death occurs before retirement, the benefitoptions available are determined by the member’s vesting status prior to death. If a member’s death occurs after retirement, the death benefit received by the beneficiary (if any) is based on the retirement plan the member selected at retirement.


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An active member is eligible to receive disability benefits when: (a) a total disability lasting 12 months or more does not allow the continuation of teaching, (b) the member has accumulated five years of credited service in North Dakota, and (c) the Board of Trustees of TFFR has determined eligibility based upon medical evidence. The amount of the disability benefit is computed by the retirement formula in NDCC Section 15-39.1-10 without consideration of age and uses the member’s actual years of credited service. There is no actuarial reduction for reason of disability retirement.

Member and Employer Contributions

Member and employer contributions paid to TFFR are set by NDCC Section 15-39.1-09. Every eligible teacher in the State of North Dakota is required to be a member of TFFR and is assessed at a rate of 11.75% of salary as defined by NDCC Section 15-39.1-04. Every governmental body employing a teacher must also pay into TFFR a sum equal to 12.75% of the teacher’s salary. Member andemployer contributions will be reduced to 7.75% each when the fund reaches 100% funded ratio on an actuarial basis.

A vested member who terminates covered employment may elect a refund of contributions paid plus 6% interest or defer payment until eligible for pension benefits. A non-vested member who terminates covered employment must claim a refund of contributions paid before age 70½. Re-funded members forfeit all service credits under TFFR. These service credits may be repurchased upon return to covered employment under certain circumstances, as defined by the NDCC.

Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

At June 30, 2019, the District reported a liability of $2,969,035 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2018 and the total pension liability used to calculate the net pension liability was determined by an actuarial calculation as of that date. The District’s proportion of the net pension liability was based on the Districts share of covered payroll in the pension plan relative to the covered payroll of all participating TFFR employees. At June 30, 2018 the District’s proportion was .222757% which was a decrease of .010276% from its proportion measured as of June 30, 2017.For the year ended June 30, 2019, the District recognized pension expenses of $198,735. At June 30, 2019, the District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred

Outflows of

Resources

Deferred

Inflows of

Resources

Differences between expected and actual experience 8,058$ 80,750$

Changes in assumptions 163,559 -

Net difference between projected and actual investment earnings - 10,265

Changes in proportion and differences between employer contributions

and proportionate share of contributions 87,963 347,482

Employer contributions subsequent to the measurement date 199,328 -

Totals 458,908$ 438,497$

$199,328 reported as deferred outflows of resources related to pensions resulting from the District contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2020.


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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 302020 $ 33,4682021 (8,036)2022 (80,846)2023 (82,708)2024 (13,312)Thereafter (27,483)

Actuarial Assumptions

The total pension liability in the July 1, 2018 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in measurement:

Inflation 2.75%Salary increases 4.25% to 14.50%, varying by service,

including inflation and productivityInvestment rate of return 7.75%, net of investment expensesCost-of-living-adjustments None

For active and inactive members, mortality rates were based on the RP-2014 Employee Mortality Table, projected generationally using Scale MP-2014. For healthy retirees, mortality rates were based on the RP-2014 Healthy Annuitant Mortality Table set back one year, multiplied by 50% for ages under 75 and grading up to 100% by age 80, projected generationally using Scale MP-2014. For disabled retirees, mortality rates were based on the RP-2014 Disabled Mortality Table set forward four years.

The actuarial assumptions used were based on the results of an actuarial experience study dated April 30, 2015. They are the same as the assumptions used in the July 1, 2017, funding actuarial valuation for TFFR.

As a result of the April 30, 2015 actuarial experience study, the TFFR Board adopted several assumption changes, including the following:

• Investment return assumption lowered from 8.00% to 7.75%.• Inflation assumption lowered from 3.00% to 2.75%.• Total salary scales rates lowered by 0.25% due to lower inflation.• Added explicit administrative expense assumption, equal to prior year administrative expense plus inflation.• Rates of turnover and retirement were changed to better reflect anticipated future experience.• Updated mortality assumption to the RP-2014 mortality tables with generational improvement.

The long-term expected rate of return on pension plan investments was determined using a building-block method in whichbest-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 Fund’s target asset allocation are summarized in the following table:

Asset Class Target AllocationLong-term Expected Real Rate of Return

Global Equities 58% 6.70%Global Fixed Income 23% 1.50%Global Real Assets 18% 5.10%Cash Equivalents 1% 0.00%


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Discount Rate

The discount rate used to measure the total pension liability was 7.75% percent as of June 30, 2018. The projection of cash flows used to determine the discount rate assumes that member and employer contributions will be made at rates equal to those based on the July 1, 2018, Actuarial Valuation Report. For this purpose, only employer contributions that are intended to fund benefits of current plan members and their beneficiaries are included. Projected employer contributions that are intended to fund the service costs of future plan members and their beneficiaries, as well as projected contributions from future plan members, are not included. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments for current plan members as of July 1, 2018. 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 as of June 30, 2018.

Sensitivity of the District’s proportionate share of the net pension liability to changes in the discount rate

The following presents the District’s proportionate share of the net pension liability calculated using the discount rate of 7.75%, as well as what the District’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.75%) or 1-percentage-point higher (8.75%) than the current rate.

1% Decrease

(6.75%)

Current Discount

Rate (7.75%)

1% Increase

(8.75%)

District 's proportionate share

of the net pension liability 4,009,057$ 2,969,035$ 2,104,061$

Pension plan fiduciary net position

Detailed information is located in the North Dakota Retirement and Investments Office’s Comprehensive Annual Financial Report the for the fiscal year ended June 30, 2018. Additional financial and actuarial information is available on their website, www.nd.gov/rio,or may be obtained by writing to RIO at ND Retirement and Investment Office, 1930 Burnt Boat Drive, PO Box 7100, Bismarck, North Dakota, 58507-7100 or by calling (701) 328-9885.

North Dakota Public Employees Retirement System

The following brief description of NDPERS is provided for general information purposes only. Participants should refer to NDCC Chapter 54-52 for more complete information.

NDPERS is a cost-sharing multi-employer defined benefit pension plan that covers substantially all employees of the State of North Dakota, its agencies and various participating political subdivisions. NDPERS provides for pension, death, and disability benefits. The cost to administer the plan is financed through the contributions and investment earnings of the plan.

Responsibility for administration of the NDPERS defined benefit pension plan is assigned to a Board comprised of seven members. The Board consists of a Chairman, who is appointed by the Governor; one member appointed by the Attorney General; one member appointed by the State Health Officer; three members elected by the active membership of the NDPERS system; and one member elected by the retired public employees.

Pension Benefits

Benefits are set by statute. NDPERS has no provisions or policies with respect to automatic and ad hoc post-retirement benefit increases. Members of the Main System are entitled to unreduced monthly pension benefits beginning when the sum of age and years of credited service equal or exceed 85 (Rule of 85), or at normal retirement age (65). For members hired on or after January 1, 2016 the Rule of 85 will be replaced with the Rule of 90 with a minimum age of 60. The monthly pension benefit is equal to 2.00% of their average monthly salary, using the highest 36 months out of the last 180 months of service, for each year of service. The plan permits early retirement at ages 55-64 with three or more years of service.


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Members may elect to receive the pension benefits in the form of a single life, joint and survivor, term-certain annuity, or partial lump sum with ongoing annuity. Members may elect to receive the value of their accumulated contributions, plus interest, as a lump sum distribution upon retirement or termination, or they may elect to receive their benefits in the form of an annuity. For each member electing an annuity, total payment will not be less than the member’s accumulated contributions plus interest.

Death and Disability Benefits

Death and disability benefits are set by statute. If an active member dies with less than three years of service for the Main System, a death benefit equal to the value of the member’s accumulated contributions, plus interest, is paid to the member’s beneficiary. If the member has earned more than three years of credited service for the Main System, the surviving spouse will be entitled to a single payment refund, life-time monthly payments in an amount equal to 50% of the member’s accrued normal retirement benefit, or monthly payments in an amount equal to the member’s accrued 100% Joint and Survivor retirement benefit if the member had reached normal retirement age prior to date of death. If the surviving spouse dies before the member’s accumulated pension benefits are paid, the balance will be payable to the surviving spouse’s designated beneficiary.

Eligible members who become totally disabled after a minimum of 180 days of service, receive monthly disability benefits equal to 25% of their final average salary with a minimum benefit of $100. To qualify under this section, the member has to become disabled during the period of eligible employment and apply for benefits within one year of termination. The definition for disabled is set by the NDPERS in the North Dakota Administrative Code.

Refunds of Member Account Balance

Upon termination, if a member of the Main System is not vested (is not 65 or does not have three years of service), they will receive the accumulated member contributions and vested employer contributions, plus interest, or may elect to receive this amount at a later date. If the member has vested, they have the option of applying for a refund or can remain as a terminated vested participant. If a member terminated and withdrew their accumulated member contribution and is subsequently reemployed, they have the option of repurchasing their previous service.

Member and Employer Contributions

Member and employer contributions paid to NDPERS are set by statute and are established as a percent of salaries and ages. Member contribution rates are 7% and employer contribution rates 7.12% of covered compensation.

The member’s account balance includes the vested employer contributions equal to the member’s contributions to an eligible deferred compensation plan. The minimum member contribution is $25, and the maximum may not exceed the following:

1 to 12 months of service Greater of one percent of monthly salary of $2513 to 24 months of service Greater of two percent of monthly salary of $2525 to 36 months of service Greater of three percent of monthly salary of $25Longer than 36 months of service Greater of four percent of monthly salary of $25


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Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions

At June 30, 2019, the District reported a liability of $663,298 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2018, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The District's proportion of the net pension liability was based on the District’s share of covered payroll in the Main System pension plan relative to the covered payroll of all participating Main System employers. At June 30, 2018, the District's proportion was .039304%, which was an increase of .002184% from its proportion measured as of June 30, 2017.

For the year ended June 30, 2019, the District recognized pension expense of $102,433. At June 30, 2019, the District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred

Outflows of

Resources

Deferred

Inflows of

Resources

Differences between expected and actual experience 1,755$ 22,567$

Changes in assumptions 239,437 9,467

Net difference between projected and actual investment earnings - 3,227


and proportionate share of contributions 22,311 31,413


Totals 292,179$ 66,674$

$28,676 reported as deferred outflows of resources related to pensions resulting from the District's contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2020.

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 302020 $ 61,2772021 52,5242022 47,5792023 32,1312024 3,318Thereafter -


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The total pension liability in the July 1, 2018 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement:

Inflation 2.50%

Salary Increases

Services at Beginning of

Year State EmployeeNon-State Employee

0 12.00% 15.00%1 9.50% 10.00%2 7.25% 8.00%

Age*Under 36 7.25% 10.00%

36-40 6.50% 7.50%41-49 6.25% 6.75%50-59 5.75% 6.50%60+ 5.00% 5.25%

* Age-based salary increase rates apply for employee with three or more years of service

Investment Rate of Return 7.75%, net of investment expense

Cost-of-Living-Adjustment None

For active members, inactive members and healthy retirees, morality rates were based on the RP-2000 Combined Healthy Mortality Table set back two years for males and three years for females, projected generationally using the SSA 2014 Intermediate Cost scale from 2014. For disabled retirees, mortality rates were based on the RP-2000 Disabled Mortality Table set back one year for males (no setback for females) multiplied by 125%.

The long-term expected rate of return on pension plan investments was determined using a building-block method in whichbest-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 Fund’s target asset allocation are summarized in the following table:

Asset Class Target AllocationLong-term Expected Real

Rate of ReturnDomestic Equity 30% 6.05%International Equity 21% 6.71%Private Equity 7% 10.20%Domestic Fixed Income 23% 1.45%International Fixed Income 0% 0.00%Global Real Assets 19% 5.11%Cash Equivalents 0% 0.00%


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Discount Rate

For PERS, GASB Statement No. 67 includes a specific requirement for the discount rate that is used for the purpose of the measurement of the Total Pension Liability. This rate considers the ability of the System to meet benefit obligations in the future. To make this determination, employer contributions, employee contributions, benefit payments, expenses and investment returns are projected into the future. The current employer and employee fixed rate contributions are assumed to be made in each future year. The Plan Net Position (assets) in future years can then be determined and compared to its obligation to make benefit payments in those years. In years where assets are not projected to be sufficient to meet benefit payments, which is the case for the PERS plan, the use of a municipal bond rate is required.

The Single Discount Rate (SDR) is equivalent to applying these two rates to the benefits that are projected to be paid during the different time periods. The SDR reflects (1) the long-term expected rate of return on pension plan investments (during the period in which the fiduciary net position is projected to be sufficient to pay benefits) and (2) a tax-exempt municipal bond rate based on an index of 20-year general obligation bonds with an average AA credit rating as of the measurement date (to the extent that the contributions for use with the long-term expected rate of return are not met).

For the purpose of this valuation, the expected rate of return on pension plan investments is 7.75%; the municipal bond rate is 3.62%; and the resulting Single Discount Rate is 6.32%.

Sensitivity of the District's proportionate share of the net pension liability to changes in the discount rate

The following presents the District's proportionate share of the net pension liability calculated using the discount rate of 6.32percent, as well as what the District's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (5.32 percent) or 1-percentage-point higher (7.32 percent) than the current rate:

1% Decrease

(5.32%)

Current Discount

Rate (6.32%)

1% Increase

(7.32%)


of the net pension liability 901,229$ 663,298$ 464,694$

Pension plan fiduciary net position

Detailed information about the pension plan’s fiduciary net position is available in the separately issued NDPERS financial report. It is located in the North Dakota Public Employees Retirement System Comprehensive Annual Financial report for thefiscal year ended June 30, 2018. The supporting actuarial information is included in the June 30, 2018, GASB Statements No. 67 and 68 Accounting and Financial Reporting for Pensions actuarial valuation for each retirement plan. Additional financial andactuarial information is available on their website, www.nd.gov/ndpers, or may be obtained by contacting the agency at North Dakota Public Employees Retirement System, 400 E Broadway Ave Suite 505, P.O. Box 1657, Bismarck, ND, 58502-1657 or by calling (701) 328-3900.

NOTE 14 – OTHER POST EMPLOYMENT BENEFITS

North Dakota Public Employees Retirement System

The following brief description of NDPERS is provided for general information purposes only. Participants should refer to NDAC Chapter 71-06 for more complete information.

NDPERS OPEB plan is a cost-sharing multiple-employer defined benefit OPEB plan that covers members receiving retirement benefits from the PERS, the HPRS, and Judges retired under Chapter 27-17 of the North Dakota Century Code a credit toward their monthly health insurance premium under the state health plan based upon the member's years of credited service. Effective July 1, 2015, the credit is also available to apply towards monthly premiums under the state dental, vision and long-term care plan and any other health insurance plan. The Retiree Health Insurance Credit Fund is advance-funded on an actuarially determined basis.


37

Responsibility for administration of the NDPERS defined benefit OPEB plan is assigned to a Board comprised of nine members. The Board consists of a Chairman, who is appointed by the Governor; one member appointed by the Attorney General; one member appointed by the State Health Officer; three members elected by the active membership of the NDPERS system, one member elected by the retired public employees and two members of the legislative assembly appointed by the chairman of the legislative management.

OPEB Benefits

The employer contribution for the PERS, the HPRS and the Defined Contribution Plan is set by statute at 1.14% of covered compensation. The employer contribution for employees of the state board of career and technical education is 2.99% of covered compensation for a period of eight years ending October 1, 2015. Employees participating in the retirement plan as part-time/temporary members are required to contribute 1.14% of their covered compensation to the Retiree Health Insurance Credit Fund. Employees purchasing previous service credit are also required to make an employee contribution to the Fund. The benefit amount applied each year is shown as "prefunded credit applied" on the Statement of Changes in Plan Net Position for the OPEB trust funds.

Retiree health insurance credit benefits and death and disability benefits are set by statute. There are no provisions or policies with respect to automatic and ad hoc post-retirement benefit increases. Employees who are receiving monthly retirement benefits from the PERS, the HPRS, the Defined Contribution Plan, the Chapter 27-17 judges or an employee receiving disability benefits, or the spouse of a deceased annuitant receiving a surviving spouse benefit or if the member selected a joint and survivor option areeligible to receive a credit toward their monthly health insurance premium under the state health plan.

Effective July 1, 2015, the credit is also available to apply towards monthly premiums under the state dental, vision and long-term care plan and any other health insurance plan. The benefits are equal to $5.00 for each of the employee’s, or deceased employee's years of credited service not to exceed the premium in effect for selected coverage. The retiree health insurance credit is also available for early retirement with reduced benefits.

OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB

At June 30, 2019, the District reported a liability of $29,062 for its proportionate share of the net OPEB liability. The net OPEB liability was measured as of June 30, 2018 and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation as of that date. The District's proportion of the net OPEB liability was based on the District's share of covered payroll in the OPEB plan relative to the covered payroll of all participating OPEB employers. At June 30, 2018, the District's proportion was .035027%, which was an increase of .001874% from its proportion measures as of June 30, 2017.

For the year ended June 30, 2019 the District recognized OPEB expense of $3,782. At June 30, 2019 the District reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

Deferred

Outflows of

Resources

Deferred

Inflows of

Resources

Differences between expected and actual experience 869$ 600$

Changes in assumptions 2,385 -

Net difference between projected and actual investment earnings - 625


and proportionate share of contributions 1,265 56


Totals 9,110$ 1,281$


38

$4,591 reported as deferred outflows of resources related to OPEB resulting from District contributions subsequent to the measurement date will be recognized as a reduction of the net OPEB liability in the year ended June 30, 2020.

Other amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEBs will be recognized in OPEB expense as follows:

Year ended June 30:2020 $ 4352021 4352022 4352023 7112024 660Thereafter 562


The total OPEB liability in the July 1, 2018 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement:

Inflation 2.50%Salary increases Not applicableInvestment rate of return 7.50%, net of investment expensesCost-of-living-adjustments None

For active members, inactive members and healthy retirees, mortality rates were based on the RP-2000 Combined Healthy Mortality Table set back two years for males and three years for females, projected generationally using the SSA 2014 Intermediate Cost scale from 2014. For disabled retirees, mortality rates were based on the RP-2000 Disabled Mortality Table set back one year for males (no setback for females) multiplied by 125%.

The long-term expected investment rate of return assumption for the RHIC fund was determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of RHIC 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. Estimates of arithmetic real rates of return, for each major asset class included in the RHIC’s target asset allocation as of July 1, 2017 are summarized in the following table:

Asset Class Target AllocationLong-term Expected Real

Rate of ReturnLarge Cap Domestic Equities 37% 5.80%Small Cap Domestic Equities 9% 7.05%International Equities 14% 6.20%Core-Plus Fixed Income 40% 1.46%

Discount Rate

The discount rate used to measure the total OPEB liability was 7.50%. The projection of cash flows used to determine the discount rate assumed plan member and statutory/Board approved employer contributions will be made at rates equal to those based on theJuly 1, 2017, and July 1, 2016, HPRS actuarial valuation reports. For this purpose, only employer contributions that are intended to fund benefits of current RHIC members and their beneficiaries are included. Projected employer contributions that are intended to fund the service costs of future plan members and their beneficiaries are not included. Based on those assumptions, the RHIC fiduciary net position was projected to be sufficient to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on RHIC investments was applied to all periods of projected benefit payments to determine the total OPEB liability.


39

Sensitivity of The District’s Proportionate Share of the Net OPEB Liability to Change in the Discount Rate

The following presents the net OPEB liability of the Plans as of June 30, 2018, calculated using the discount rate of 7.50 percent, as well as what the RHIC net OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.50 percent) or 1-percentage-point higher (8.50 percent) than the current rate:

1% Decrease

(6.75%)

Current Discount

Rate (7.75%)

1% Increase

(8.75%)


of the net pension liability 36,770$ 29,062$ 22,454$

NOTE 15 – JOINT VENTURE

The District participates in the following joint ventures:

A. South Valley Multi-District Special Education Unit

Formed for the purpose of providing special education services to the member school districts. The Co-op's governing board is composed of ten representatives from the member school districts, who are superintendents. The Board is responsible for adopting the Co-op's budget and setting service fees at a level adequate to fund the adopted budget. The District retains no equity in the net assets of the Co-op, but does have a responsibility to fund deficits of the Co-op in proportion to the relative participation described above. Separate financial statements for this joint venture are available from South Valley Multi-District Special Education Unit.

B. Southeast Region Career and Technology Center

Formed for the purpose of providing vocational services to the member school districts. The Co-op’s governing board is composed of eight representatives from the member school districts, who are school board members. The Board is responsible for adopting the Co-op’s budget and setting service fees at a level adequate to fund the adopted budget. The District retains no equity in the net assets of the Co-op, but does have a responsibility to fund deficits of the Co-op in proportion to the relative participation. Separate financial statements for this joint venture are available from Southeast Region Career and TechnologyCenter.

NOTE 16 – NONMONETARY TRANSACTIONS

The District receives food commodities from the federal government to subsidize its food service program. The market value ofcommodities received for the year ended June 30, 2019 was $12,529.

NOTE 17 – TRANSFERS

The following is a summary of transfers for the year ended June 30, 2019:

Transfers In Transfers Out

Fund

General Fund 30,000$ -$

Special Reserve - 30,000

Totals 30,000$ 30,000$

The transfer from the special reserve fund to the general fund was made in compliance with NDCC 57-19-01 to not exceed fifteen mills in the special reserve fund.


40

NOTE 18 – CONCENTRATIONS

The District receives a substantial amount of its support from federal and state governments. A significant reduction in this support may have a material effect on the District's programs and its continued operations.

NOTE 19 – SUBSEQUENT EVENTS

The District has evaluated subsequent events through December 3, 2019, the date on which the financial statements were available to be issued.


BUDGETARY COMPARISON SCHEDULE – GENERAL FUNDYear Ended June 30, 2019

41

Original Budget Final Budget Actual

Variance with

Final Budget

Positive

(Negative)

REVENUES

Local Sources 768,790$ 768,790$ 774,744$ 5,954$

State Sources 2,726,403 2,726,403 2,717,497 (8,906)

Federal Sources 80,454 80,454 89,129 8,675

Interest Income 9,000 9,000 26,693 17,693

Miscellaneous Income - - 3,839 3,839

Total Revenues 3,584,647 3,584,647 3,611,902 27,255

EXPENDITURES

Current

Regular Instruction 1,986,634 1,986,634 1,969,835 16,799

Special Instruction 267,149 267,149 260,517 6,632

Vocational Instruction 197,578 197,578 204,323 (6,745)

Pupil Services 120,563 120,563 118,252 2,311

General Administration Services 248,510 248,510 244,219 4,291

School Administration Services 157,125 157,125 151,343 5,782

Operation and Maintenance 379,745 379,745 393,461 (13,716)

Pupil Transportation 214,044 214,044 173,112 40,932

Student Activities 140,418 140,418 127,099 13,319

Community Services 29,234 29,234 28,437 797

Total Expenditures 3,741,000 3,741,000 3,670,598 70,402

Exces (Deficiency) of Revenues

over Expenditures (156,353) (156,353) (58,696) 97,657

OTHER FINANCING SOURCES

Operating Transfer In - - 30,000 30,000

Total Other Financing Sources - - 30,000 30,000

NET CHANGE IN FUND BALANCE (156,353) (156,353) (28,696) 127,657

FUND BALANCE, BEGINNING OF YEAR 997,940

FUND BALANCE, END OF YEAR 969,244$


PENSION SCHEDULESYear Ended June 30, 2019

*Complete data for these schedules is not available prior to 2015**The measurement date of the net pension liability is June 30th of the prior year

42

2019 2018 2017 2016 2015

District 's proportion of the net pension liability (asset) 0.222757% 0.233033% 0.222947% 0.255007% 0.259458%

District 's proportionate share of the net pension liability (asset) 2,969,035 3,200,780 3,266,307 3,335,122 2,718,660

District 's covered-employee payroll 1,514,323 1,572,912 1,448,543 1,568,558 1,504,994

District 's proportionate share of the net pension liability (asset) as a percentage of its

covered-employee payroll 196.06% 203.49% 225.49% 212.62% 180.64%

Plan fiduciary net position as a percentage of the total pension liability 65.50% 63.20% 59.20% 62.10% 66.60%

2019 2018 2017 2016 2015

Statutorily required contribution 193,076 200,546 184,689 199,982 161,785

Contributions in relation to statutorily required contribution (193,076) (200,546) (184,689) (199,982) (161,785)

Contribution deficiency (excess) - - - - -

Employer's covered-employee payroll 1,514,323 1,572,912 1,448,543 1,568,558 1,504,994

Contributions as a percentage of covered-employee payroll 12.75% 12.75% 12.75% 12.75% 10.75%

Last 10 Fiscal Years*


ND Teacher's Fund for Retirement (TFFR)

Schedule of Employer Contributions

Schedule of Employer's Share of Net Pension Liability

ND Teacher's Fund for Retirement (TFFR)

RICHLAND PUBLIC SCHOOL DISTRICT NO. 44Pension Schedules – Continued


43

2019 2018 2017 2016 2015

District 's proportion of the net pension liability (asset) 0.000000% 0.037120% 0.036042% 0.042615% 0.046336%

District 's proportionate share of the net pension liability (asset) 663,298 596,640 351,264 289,775 294,104

District 's covered-employee payroll 403,778 378,939 363,215 379,645 390,326


covered-employee payroll 164.27% 157.45% 96.71% 76.33% 75.35%

Plan fiduciary net position as a percentage of the total pension liability 62.80% 61.98% 70.46% 77.15% 77.70%

2019 2018 2017 2016 2015

Statutorily required contribution 29,740 27,478 26,296 28,837 27,791

Contributions in relation to statutorily required contribution (29,797) (27,034) (27,102) (31,143) (27,791)

Contribution deficiency (excess) (57) 444 (806) (2,306) -

Employer's covered-employee payroll 403,778 378,939 363,215 379,645 390,326

Contributions as a percentage of covered-employee payroll 7.38% 7.13% 7.46% 8.20% 7.12%


ND Public Employees Retirement System (PERS)

Schedule of Employer Contributions


Schedule of Employer's Share of Net Pension Liability


RICHLAND PUBLIC SCHOOL DISTRICT NO. 44Pension Schedules – Continued


44

2019 2018

District 's proportion of the net pension liability (asset) 0.036901% 0.035027%

District 's proportionate share of the net pension liability (asset) 29,062 27,707

District 's covered-employee payroll 403,778 378,939


covered-employee payroll 7.20% 7.31%

Plan fiduciary net position as a percentage of the total pension liability 61.89% 59.78%

2019 2018

Statutorily required contribution 4,736 4,405

Contributions in relation to statutorily required contribution (4,771) (4,329)

Contribution deficiency (excess) (35) 76

Employer's covered-employee payroll 403,778 378,939

Contributions as a percentage of covered-employee payroll 1.18% 1.14%



Schedule of Employer Contributions OPEB


Schedule of Employer's Share of Net OPEB Liability



NOTES TO REQUIRED SUPPLEMENTARY INFORMATIONJune 30, 2019

45

NOTE 1 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY

Budgetary Information

The School Board adopts an annual budget on a basis consistent with accounting principles generally accepted in the United States for the general fund.

The following procedures are followed in establishing the budgetary data reflected in the financial statements:

- The annual budget must be prepared, and District taxes must be levied on or before the 15th day of August of each year.- The taxes levied must be certified to the county auditor by October 10th.- The operating budget includes proposed expenditures and means of financing them.- Each budget is controlled by the Business Manager at the revenue and expenditure function/object level.- The current budget, except for property taxes, may be amended during the year for any revenues and appropriations

not anticipated at the time the budget was prepared.- All appropriations lapse at year-end.

NOTE 2 – NORTH DAKOTA TEACHERS' FUND FOR RETIREMENT CHANGES OF ASSUMPTIONS

Amounts reported in 2016 and later reflect the following actuarial assumption changes based on the results of an actuarial experience study dated April 30, 2015.

- Investment return assumption lowered from 8.00% to 7.75%.

- Inflation assumption lowered from 3.00% to 2.75%.- Total salary scale rates lowered by .25% due to inflation.- Added explicit administrative expense assumption, equal to prior year administrative expense plusinflation.

- Rates of turnover and retirement were changed to better reflect anticipated future experience.- Updated mortality assumption to the RP-2014 mortality tables with generational improvement.

NOTE 3 – NORTH DAKOTA PUBLIC EMPLOYEES RETIREMENT SYSTEM CHANGES OF ASSUMPTIONS

Amounts reported in 2019 reflect actuarial assumption changes effective July 1, 2018 based on the results of an actuarial experience study completed in 2015. This includes changes to the mortality tables, disability incidence rates, retirement rates, administrative expenses, salary scale, and percent married assumption.

NOTE 4 – NORTH DAKOTA PUBLIC EMPLOYEES RETIREMENT SYSTEM CHANGE OF ASSUMPTIONS OPEB

Amounts reported in 2019 reflect actuarial assumption changes effective July 1, 2018 based on the results of an actuarial experience study completed in 2015. This includes changes to the mortality tables, disability incidence rates, retirement rates, administrative expenses, salary scale, and percent married assumption.


NONMAJOR GOVERNMENTAL FUNDS – COMBINING BALANCE SHEETJune 30, 2019

46

Special Reserve Food Service

Total Other

Governmental

Funds

ASSETS

Cash and Cash Equivalents 115,507$ 1,961$ 117,468$

Due from County 5 - 5

Taxes Receivable 977 - 977

Total Assets 116,489 1,961 118,450

LIABILITIES

Accounts Payable - 87 87

Total Liabilit ies - 87 87


Unavailable Revenue - Property Taxes 977 - 977

Total Deferred Inflows of Resources 977 - 977

FUND BALANCE

Restricted 115,512 - 115,512

Assigned - 1,874 1,874

Fund Balance 115,512 1,874 117,386

Total Liabilit ies, Deferred Inflows of

Resources, and Fund Balance 116,489$ 1,961$ 118,450$


NONMAJOR GOVERNMENTAL FUNDS – COMBINING SCHEDULE OF REVENUES, EXPENDITURES,AND CHANGES IN FUND BALANCEJune 30, 2019

47

Special Reserve Food Service

Total Other

Governmental

Funds

REVENUES

Local Sources 28,049$ 102,384$ 130,433$

State Sources - 1,561 1,561

Federal Sources - 49,216 49,216

Interest Income 2 - 2

Total Revenues 28,051 153,161 181,212

EXPENDITURES

Current

School Food Services - 144,194 144,194

Total Expenditures - 144,194 144,194

Excess of Revenues over

Expenditures 28,051 8,967 37,018

OTHER FINANCING SOURCES (USES)

Operating Transfer Out (30,000) - (30,000)

Total Other Financing Sources (Uses) (30,000) - (30,000)

NET CHANGE IN FUND BALANCE (1,949) 8,967 7,018

FUND BALANCE (DEFICIT), BEGINNING OF YEAR 117,461 (7,093) 110,368

FUND BALANCE, END OF YEAR 115,512$ 1,874$ 117,386$


SCHEDULE OF RECEIPTS AND DISBURSEMENTS – ACTIVITY FUNDJune 30, 2019

48

Account

Balance

July 1, 2018

Deposits and

Transfers In

Withdrawals and

Transfers Out

Balance

June 30, 2019

Clay Target League 4,807$ 2,531$ (5,069)$ 2,269$

Coffee Shop (604) 604 - -

Seniors 4,591 1,075 (2,766) 2,900

FCCLA 1,154 5,475 (5,698) 931

Juvenile Justice 1,665 - (59) 1,606

Class of 2022 50 - - 50

Fitness Center 20,008 3,402 (12,038) 11,372

School Paper 2,363 470 (200) 2,633

Student Council 7,046 10,650 (11,493) 6,203

Activity Account (7,849) 6,460 (4,157) (5,546)

Special Music 500 399 (899) -

Close-Up 36,542 46,736 (39,296) 43,982

JHGBB 631 - (631) -

Tournaments - 11,783 (11,758) 25

High School 2,400 1,400 (206) 3,594

Girls Basketball - 1,067 (1,237) (170)

Yearbook 4,783 11,514 (10,967) 5,330

Football 1 75 (60) 16

Athletic Fund 1,144 29,336 (38,481) (8,001)

Elementary 7,845 5,706 (7,395) 6,156

PB&J 1,684 350 (887) 1,147

School Store (8,254) 15,516 (9,451) (2,189)

Freshmen - 50 - 50

Scoreboard (16,991) 28,882 (1,758) 10,133

Juniors 1,609 15,745 (13,240) 4,114

Tech Fee 4,015 3,550 - 7,565

Volleyball 1,435 2,841 (2,290) 1,986

Reserve - 1,250 - 1,250

X-Country 839 2,857 (3,010) 686

District FCCLA 1,129 - (1,129) -

Totals 72,543$ 209,724$ (184,175)$ 98,092$

49

Nadine Julson, LLC

506 Dakota Ave. Wahpeton, ND 58075 www.julsoncpa.com T 701.642.8146 F 701.642.8165

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

School BoardRichland Public School District No. 44Colfax, North Dakota

We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to finance audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Richland Public School District No. 44, as of and for the year ended June 30, 2019, and the related notes to financial statements, which collectively comprise the Richland Public School District No. 44's basic financial statements, and have issued our report thereon dated December 3, 2019.

Internal Control Over Financial Reporting

In planning and performing our audit of the financial statements, we considered Richland Public School District No. 44’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 Richland Public School District No. 44's internal control. Accordingly, we do not express an opinion on the effectiveness of the District’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or 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 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 and therefore, material weaknesses or significant deficiencies may exist that were not identified. We did identify certain deficiencies in internal control, described in the accompanying schedule of findings and questioned costs that we consider to be material weaknesses (2019-001 and 2019-002).

Nadine Julson, LLC

50

Compliance and Other Matters

As part of obtaining reasonable assurance about whether Richland Public School District No. 44’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 these 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.

District's Response to Findings

Richland Public School District No. 44’s response to the findings identified in our audit is described in the accompanying scheduleof findings and questioned costs. Richland Public School District No. 44's response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it.

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 District’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Nadine Julson, LLC Wahpeton, North DakotaDecember 3, 2019


SCHEDULE OF FINDINGS AND QUESTIONED COSTSYear ended June 30, 2019

51

SECTION I - SUMMARY OF AUDITOR'S RESULTS

Financial Statements

Type of Report Issued: Unmodified

Internal Control Over Financial Reporting

Material weakness identified? X Yes NoSignificant deficiencies identified not considered to be material weaknesses? Yes X None reportedNoncompliance material to financial statements noted? Yes X No

SECTION II - FINANCIAL STATEMENT FINDINGS

2019-001 LACK OF SEGREGATION OF DUTIES

Criteria

An appropriate system of internal controls has the proper segregation of duties between authorization, custody, record keeping, and reconciliation functions.

Condition

Proper internal control surrounding custody of assets, the recording of transactions, reconciling bank accounts and preparation of financial statements dictates that there should be sufficient accounting personnel, so duties of employees are properly segregated. More segregation of duties would provide better control over the assets of the District.

Effect

The lack of segregation of duties increases the risk of fraud and the risk of misstatement of the District’s financial condition whether due to error or fraud.

Recommendation

The accounting functions should be reviewed to determine if additional segregation of duties is feasible and to improve the efficiency and effectiveness of financial management and financial statement accuracy for the District. Segregation of authorization, custody of assets, record keeping, and reconciliation functions would assist in mitigating the risk of fraud or misstatements to the financial statements.

Views of Responsible Officials

There is no disagreement with the audit finding and we understand that this will be a repeated recommendation due to the limited amount of resources of the District.

RICHLAND PUBLIC SCHOOL DISTRICT NO. 44Schedule of Findings and Questioned Costs - Continued

52

2019-002 MATERIAL JOURNAL ENTRIES

Criteria

A good system of internal accounting control contemplates an adequate system for the preparation of the financial statements, including recording government wide journal entries in order to reconcile from the fund financials to the government wide financials and ensuring all general ledger accounts are properly reflected on a GAAP basis.

Condition

The District does not have an internal control system designed to provide for the preparation of the financial statements being audited, including recording government wide journal entries. As auditors, we were requested to draft the financial statements, which include proposing government wide journal entries, and drafting the accompanying notes to the financial statements.

Effect

Inadequate controls over financial reporting of the District results in more than a remote likelihood that the District would not be able to draft the financial statements and accompanying notes to financial statements that are materially correct without theassistance of the auditors.

Recommendation

It is the responsibility of management and those charged with governance to make the decision whether to accept the degree of risk associated with this condition because of cost or other considerations.

Views of Responsible Officials

There is no disagreement with the audit finding and we understand that this will be a repeated recommendation due to the limited amount of resources of the District.


SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGSYear ended June 30, 2019

53

Prior Financial Statement Findings:

2018-001A material weakness was reported for a lack of segregation of duties.

Corrective Action Plan

The accounting functions should be reviewed to determine if additional segregation of duties is feasible and to improve the efficiency and effectiveness of financial management and financial statement accuracy for the District. Segregation of authorization, custody of assets, record keeping, and reconciliation functions would assist in mitigating the risk of fraud or misstatements to the financial statements. This material weakness continues to exist under the current audit findings as finding number 2019-001.

2018-002A material weakness was reported for material journal entries.

Corrective Action Plan

The accounting functions should be reviewed to determine if it is feasible for the District to prepare its own financial statements. This material weakness continues to exist under the current audit findings as number 2019-002.

APPENDIX B

Form of Legal Opinion

, 2020

Richland Public School District No. 44101 Main StreetColfax, North Dakota 58018

$1,695,000Richland Public School District No. 44

Richland County, North DakotaTaxable General Obligation School Building Refunding Bonds

Series 2020

We have acted as Bond Counsel to Richland Public School District No. 44, Richland County,North Dakota (the “Issuer”), in connection with the issuance of $1,695,000 Taxable GeneralObligation School Building Refunding Bonds, Series 2020, dated the date hereof (the “Bonds”). Wehave examined the law and such certified proceedings and other papers as we deem necessary torender this opinion.

As to questions of fact material to our opinion, we have relied upon the certified proceedingsand other certifications of public officials furnished to us without undertaking to verify such factsby independent investigation.

We have not been engaged or undertaken to review the accuracy, completeness, orsufficiency of the official statement or other offering material relating to the Bonds (except to theextent, if any, stated in the official statement) and we express no opinion relating thereto (exceptingonly the matters set forth as our opinion in the official statement).

Based on our examination, we are of the opinion, as of the date hereof as follows:

1. The Bonds are valid and binding general obligations of the Issuer.

Richland Public School District No. 44

, 2020Page 2

2. Proceeds of the Bonds will be deposited in escrow with BNY Mellon,Dallas, Texas (the “Escrow Agent”), and will be used to pay and refund the Issuer’s outstanding General Obligation School Building Bonds, Series 2013A on August 1, 2021 (the “Redemption Date”).

3. All taxable property within the corporate limits of the Issuer is subject to advalorem taxation without limitation as to rate or amount to pay the Bonds. The Issuer is required by law to include in its annual tax levy the principal and interest coming due on the Bonds to the extent the necessary funds are not provided from other sources.

4. Prior to the Redemption Date, interest on the Bonds will be paid from escrowfunds held by the Escrow Agent. After the Redemption Date, the Bonds, unless paid from other sources, are payable as to both principal and interest from the 2020 Taxable General Obligation School Building Refunding Bond Fund to which the Issuer has irrevocably pledged the ad valorem tax described in paragraph 3.

5. The Bonds were issued for the purpose of a crossover advance refunding of theoutstanding maturities of the Issuer’s valid outstanding General Obligation School Building Bonds, Series 2013A, thereby reducing the debt service costs of the Issuer.

It is to be understood that the rights of the holders of the Bonds, and the enforceability thereof, may be subject to bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors’ rights heretofore or hereafter enacted to the extent constitutionally applicable and that their enforcement may be subject to the exercise of judicial discretion in appropriate cases.

Sincerely,

ARNTSON STEWART WEGNER PC

APPENDIX C

Form of Continuing Disclosure Agreement

CONTINUING DISCLOSURE CERTIFICATE

THIS CONTINUING DISCLOSURE CERTIFICATE (this “Disclosure Certificate”) ismade and entered into as of , 2020, by Richland Public School District No. 44 ofRichland County, North Dakota (the “District”), in connection with the issuance of the District’s$1,695,000 Taxable General Obligation School Building Refunding Bonds, Series 2020 (the“Bonds”). The Bonds are being issued pursuant to a Resolution adopted September 16, 2020 (the“Resolution”), and the Bonds will be delivered to the Purchaser on the date hereof. Pursuant toSection 6.03 of the Resolution, the District covenants and agrees as follows:

SECTION 1. PURPOSE OF THIS DISCLOSURE CERTIFICATE. This Disclosure Certificateis being executed and delivered by the District for the benefit of the Owners of the Bonds and inorder to assist the Participating Underwriters within the meaning of SEC Rule 15c2-12(b)(5) (the“Rule”) in complying with the Rule. This Disclosure Certificate constitutes the written undertakingrequired by the Rule.

SECTION 2. DEFINITIONS. In addition to the definitions set forth in the Resolution, whichapply to any capitalized term use in this Disclosure Certificate unless otherwise defined in thisSection, the following capitalized terms shall have the following meanings:

“Annual Report” means any Annual Report provided by the District pursuant to and asdescribed in, Sections 3 and 4 of this Disclosure Certificate.

“Disclosure Representative” means the Business Manager of the District or his or herdesignee, or such other person as the District shall designate in writing to the Dissemination Agent,if any, from time to time.

“Dissemination Agent” means any Dissemination Agent appointed hereunder, or anysuccessor Dissemination Agent designated in writing by the District and which has filed with theDistrict a written acceptance of such designation.

“Final Official Statement” means the deemed final official statement dated September ,2020, which constitutes the final official statement delivered in connection with the Bonds, whichis available from the MSRB.

“Financial Obligation” means: (i) a debt obligation; (ii) a derivative instrument entered intoin connection with, or pledged as security or a source of payment for, an existing or planned debtobligation; or (iii) guarantee of a debt obligation or derivative instrument. Financial Obligation shallnot include municipal securities as to which a final official statement has been provided to theMSRB consistent with the Rule.

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“Financial Statements” means audited or, if unavailable, unaudited general purposefinancial statements of the District prepared in accordance with generally accepted accountingprinciples, as in effect from time to time or as required to be modified as a matter of law. Ifunaudited financial statements are provided, audited financial statements will be provided when andif available.

“Fiscal Year” means the fiscal year of the District.

“MSRB” means the Municipal Securities Rulemaking Board located at 1300 I Street NW,Suite 1000, Washington, DC 20005.

“Owner” means the person in whose name the Bond is registered or a beneficial owner ofsuch Bond.

“Participating Underwriter” means any of the original underwriters of the Bonds (includingthe Purchaser) required to comply with the Rule in connection with the offering of the Bonds.

“Repository” means the Municipal Securities Rulemaking Board’s Electronic MunicipalMarket Access (EMMA) system or any other nationally recognized municipal securities informationrepository recognized from time to time by the SEC for purposes of the Rule.

“Rule” means SEC Rule 15c2-12(b)(5) promulgated by the SEC under the SecuritiesExchange Act of 1934, as the same may be amended from time to time, and including writteninterpretations thereof by the SEC.

“SEC” means the Securities and Exchange Commission.

“Specified Event” means any of the events listed in Section 5(a) of this DisclosureCertificate.

SECTION 3. PROVISION OF ANNUAL REPORTS.

(a) The District shall, or shall cause any Dissemination Agent to, not later than365 days after the end of each fiscal year, commencing with the fiscal year ending June 30,2020, provide to the Repository an Annual Report which is consistent with the requirementsof Section 4 of this Disclosure Certificate. Not later than fifteen (15) Business Days priorto said date, the District shall provide the Annual Report to the Dissemination Agent, if any. In each case, the Annual Report may be submitted as a single document or as separatedocuments comprising a package, and may cross-reference other information as provided inSection 4 of this Disclosure Certificate; provided, that the audited Financial Statements ofthe District may be submitted separately from the balance of the Annual Report.

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(b) If by fifteen (15) Business Days prior to the date specified in subsection (a)for providing the Annual Report to the Repositories, the Dissemination Agent, if any, has notreceived a copy of the Annual Report, the Dissemination Agent shall contact the District todetermine if the District is in compliance with subsection (a).

(c) If the Dissemination Agent, if any, is unable to verify that an Annual Reporthas been provided to the Repositories by the date required in subsection (a), theDissemination Agent shall send, in a timely manner, a notice to the Repository insubstantially the form attached as Exhibit A.

(d) The Disclosure Representative or the Dissemination Agent, if any, shall:

(i) determine each year prior to the date for providing the Annual Reportthe name and address of the Repository;

(ii) transmit the Annual Report to the Repository by (A) electronicfacsimile transmissions, confirmed by first class mail, postage prepaid, or (B) firstclass mail, postage prepaid, or any overnight delivery service selected by theDisclosure Representative or the Dissemination Agent; and

(iii) file a report with the District certifying that the Annual Report hasbeen provided pursuant to this Disclosure Certificate, stating the date it was provided,and listing all the Repositories to which it was provided.

SECTION 4. CONTENT OF ANNUAL REPORTS. The District’s Annual Report shall containor incorporate by reference the District’s Financial Statements or Unaudited Financial Statementsand the operating data of the District which is customarily prepared and is publicly available.

In the event that audited Financial Statements are not available by the reporting date, theDistrict shall provide Unaudited Financial Statements as part of the Report and deliver auditedFinancial Statements to the Repository as soon as available thereafter. The failure to file auditedFinancial Statements by the reporting date shall not be a default under this Disclosure Certificate ifthe failure to file is due to the unavailability of the audited Financial Statements.

Any or all of the items listed above may be incorporated by reference from other documents,including official statements of debt issues with respect to which the District is an “obligated person”(as defined by the Rule), which have been filed with each of the Repositories or the Securities andExchange Commission. If the document incorporated by reference is a final official statement, itmust be available from the MSRB. The District shall clearly identify each such other document soincorporated by reference.

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SECTION 5. REPORTING OF SPECIFIED EVENTS.

(a) The District shall also provide in a timely manner not in excess of tenbusiness days after the occurrence of the event, notice of any of the following events orconditions of which any of its Board Members or employees has actual knowledge:

(i) principal and interest payment delinquencies;

(ii) non-payment related defaults;

(iii) unscheduled draws on debt service reserves reflecting financialdifficulties (the Bond issue has no debt service reserve);

(iv) unscheduled draws on credit enhancements reflecting financialdifficulties;

(v) substitution of credit or liquidity providers, or their failure to perform(the Bond issue has no credit or liquidity providers);

(vi) adverse tax opinions the issuance by the Internal Revenue Service ofproposed or final determinations of taxability, Notice of Proposed Issue (IRS Form5701-TEB) or other material notices or determinations with respect to the tax statusof the bonds, or other material events affecting the tax status of the Bonds;

(vii) modifications to rights of Owners of the Bonds, if material;

(viii) bond calls, if material, and tender offers;

(ix) defeasances;

(x) release, substitution, or sale of property securing repayment of theBonds;

(xi) rating changes;

(xii) bankruptcy, insolvency, receivership or similar events of the District;

(xiii) the consummation of a merger, consolidation or acquisition involvingthe District or the sale of all or substantially all of the assets of the District, other thanin the ordinary course of business, the entry into a definitive agreement to undertakesuch an action or the termination of a definitive agreement relating to any suchactions, other than pursuant to its terms, if material;

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(xiv) appointment of a successor or additional trustee or the change of nameof a trustee, if material;

(xv) incurrence of a Financial Obligation of the District, if material, oragreement to covenants, events of default, remedies, priority rights, or other similarterms of a Financial Obligation of the District, any of which affect security holders,if material; and

(xvi) default, event of acceleration, termination event, modification ofterms, or other similar events under the terms of a Financial Obligation of theDistrict, any of which reflect financial difficulties.

(b) Unless otherwise required by law, the District shall provide notices ofSpecified Events required by this Section to the Repository.

(c) Unless otherwise required by law and subject to technical and economicfeasibility, the District shall employ such methods of information transmission as shall berequested or recommended by the designated recipients of the District’s information.

SECTION 6. TERMINATION OF REPORTING OBLIGATION. The District’s obligationsunder this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption orpayment in full of all of the Bonds.

SECTION 7. DISSEMINATION AGENT. The District may, from time to time, appoint orengage a Dissemination Agent to assist it in carrying out its obligations under this DisclosureCertificate, and may discharge any such Agent, with or without appointing a successorDissemination Agent. If at any time there is no other designated Dissemination Agent, the BusinessManager of the District shall be the Dissemination Agent.

SECTION 8. AMENDMENT; WAIVER. Notwithstanding any other provision of thisDisclosure Certificate, the District and the Dissemination Agent may amend this DisclosureCertificate (and the Dissemination Agent shall agree to any amendment so requested by the District)and any provision of this Disclosure Certificate may be waived, if such amendment or waiver issupported by an opinion of nationally recognized bond counsel to the effect that such amendmentor waiver would not, in and of itself, cause the undertakings herein to violate the Rule. ThisDisclosure Certificate, or any provision hereof, shall be null and void in the event that the Districtreceives an opinion of nationally recognized bond counsel to the effect that those portions of theRule which require this Disclosure Certificate are invalid, have been repealed retroactively orotherwise do not apply to the Bonds. The provisions of this Disclosure Certificate may be amendedwithout the consent of the Owners of the Bonds, but only upon the receipt by the District of anopinion of nationally recognized bond counsel to the effect that such amendment, and giving effectthereto, will not adversely affect the compliance of this Disclosure Certificate by the District withthe Rule.

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SECTION 9. ADDITIONAL INFORMATION. Nothing in this Disclosure Certificate shall bedeemed to prevent the District from disseminating any other information, using the means ofdissemination set forth in this Disclosure Certificate or any other means of communication, orincluding any other information in any Annual Report or notice of occurrence of a Specified Event,in addition to that which is required by this Disclosure Certificate. If the District chooses to includeany information in any Annual Report or notice of occurrence of a Specified Event in addition to thatwhich is specifically required by this Disclosure Certificate, the District shall have no obligationunder this Disclosure Certificate to update such information or include it in any future Annual Reportor notice of occurrence of a Specified Event.

SECTION 10. DEFAULT. In the event of a failure of the District or the Dissemination Agentto comply with any provision of this Disclosure Certificate, the Dissemination Agent may (and, atthe request of any Participating Underwriter or the Owners of at least 25% aggregate principalamount of Outstanding Bonds, shall), or any Owner, including beneficial owners, may take suchactions as may be necessary and appropriate, including seeking mandate or specific performance bycourt order, to cause the District or the Dissemination Agent, as the case may be, to comply with itsobligations under this Disclosure Certificate. A default under this Disclosure Certificate shall notbe deemed an Event of Default under the Resolution, and the sole remedy under this DisclosureCertificate in the event of any failure of the District or the Dissemination Agent to comply with thisDisclosure Certificate shall be an action to compel performance.

SECTION 11. DUTIES, IMMUNITIES AND LIABILITIES OF DISSEMINATION AGENT. TheDissemination Agent shall have only such duties as are specifically set forth in this DisclosureCertificate, and the District agrees to indemnify and save the Dissemination Agent, its officers,directors, employees and agents, harmless against any loss, expense and liabilities which it may incurarising out of or in the exercise or performance of its powers and duties hereunder, including thecosts and expenses (including attorneys fees) of defending against any claim of liability, butexcluding liabilities due to the Dissemination Agent’s negligence or willful misconduct. Theobligations of the District under this Section shall survive resignation or removal of theDissemination Agent and payment of the Bonds.

SECTION 12. BENEFICIARIES. This Disclosure Certificate shall inure solely to the benefitof the District, the Dissemination Agent, the Participating Underwriters, and Owners, includingbeneficial owners, from time to time of the Bonds, and shall create no rights in any other person orentity.

SECTION 13. COUNTERPARTS. This Disclosure Certificate may be executed in severalcounterparts, each of which shall be an original and all of which shall constitute but one and thesame instrument.

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IN WITNESS WHEREOF, the District has caused this Disclosure Certificate to beexecuted by its duly authorized officers, all as of the date first above written.

RICHLAND PUBLIC SCHOOLDISTRICT NO. 44

President of the School Board

ATTEST:

Business Manager

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EXHIBIT A

NOTICE TO REPOSITORIESOF FAILURE TO FILE ANNUAL REPORT

Name of Issuer: Richland Public School District No. 44

Name of Bond Issue: Taxable General Obligation School BuildingRefunding Bonds, Series 2020

Name of District: Richland Public School District No. 44

Date of Issuance: , 2020

NOTICE IS HEREBY GIVEN that the District has not provided an Annual Report with respect tothe above-named bonds as required by Section 6.03 of the Resolution adopted September 16, 2020. The District anticipates that the Annual Report will be filed by .

Dated: .

,on behalf of the DISTRICT

cc: District

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APPENDIX D

Official Notice of Sale

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OFFICIAL NOTICE OF SALE

$1,695,000(1) TAXABLE GENERAL OBLIGATION SCHOOL BUILDING REFUNDING BONDS,

SERIES 2020 RICHLAND PUBLIC SCHOOL DISTRICT NO. 44

RICHLAND COUNTY, NORTH DAKOTA

NOTICE IS HEREBY GIVEN that these Bonds will be offered for sale according to the following terms:

TIME AND PLACE Electronic and Sealed bids for the purchase of $1,695,000* Taxable General Obligation School Building Refunding Bonds, Series 2020 (the “Bonds”), will be received by the Richland Public School District No. 44, North Dakota (the “District”) on Wednesday, September 16, 2020, until 11:00 A.M. Central Time, in the offices of PFM Financial Advisors, LLC, 50 South Sixth Street, Suite 2250, Minneapolis, Minnesota 55402. Consideration of the award of the Bonds upon the terms specified herein and most favorable to the District will be at a regular Board Meeting on Wednesday, September 16, 2020.

SECURITY AND PURPOSE

The Bonds are general obligations of the District for the payment of which it pledges its full faith and credit and power to levy ad valorem taxes unlimited as to rate or amount. The proceeds of the Bonds will be used for the purpose of (i) refunding on a taxable advance refunding basis the 2024-2033 maturities of the District’s $1,605,000 General Obligation School Building Bonds, Series 2013A, dated September 10, 2013, and (ii) paying the costs associated with the issuance of the Bonds.

NORTH DAKOTA SCHOOL DISTRICT CREDIT ENHANCEMENT PROGRAM The District will participate in the program.

FORMS OF PROPOSALS

Bids must be submitted on or in substantial compliance with the Official Bid From or through Parity (the “Electronic Bid System”). The District shall not be responsible for any malfunction or mistake made by any person, or as a result of the use of the electronic bidding, facsimile facilities or the means used to deliver or complete a bid. The use of such facilities or means is at the sole risk of the prospective bidder who shall be bound by the terms of the proposal as received. No bids will be received after 11:00 A.M. Central Time on Wednesday, September 16, 2020, as specified in the Official Notice of Sale. The time as maintained by the Electronic Bid System shall constitute the official time with respect to all bids submitted. A bid may be withdrawn before the bid deadline using the same method used to submit the proposal. If more than one bid is received from the bidder, the last bid shall be considered. Sealed Bidding: Sealed bids may be submitted and will be received at the offices of PFM Financial Advisors, LLC, 50 South Sixth Street, Suite 2250, Minneapolis, MN 55402, (612) 338-3535. Electronic Bidding: The District assumes no responsibility or liability for proposals submitted electronically. Notice is hereby given that electronic proposals will be received via Parity, in the manner described below, until 11:00 P.M. Central Time on Wednesday, September 16, 2020, but no bid will be received after that time. If any provisions in this Request for Proposals conflicts with information provided by an electronic bidding service, these terms of Bond Sale shall control. For further information about Parity, potential bidders may contact PFM Financial Advisors, LLC, the District’s Municipal Advisor, or BiDCOMP/Parity, Customer Support, 1359 Broadway, Second Floor, New York, New York 10010, (212) 849-5021.

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Each bidder shall be solely responsible for making necessary arrangements to access the Electronic Bid System for purposes of submitting its electronic bid in a timely manner and in compliance with the requirements of the Official Notice of Sale. The District is permitting proposers to use the services of the Electronic Bid System solely as a communication mechanism to conduct the electronic bidding and the Electronic Bid System is not an agent of the District. Provisions of the Official Notice of Sale and the Official Bid Form shall control in the event of conflict with information provided by the Electronic Bid System. Electronic Facsimile Bidding: Bids may be submitted via facsimile at the offices of PFM Financial Advisors, LLC, Fax number (612) 338-7264. Electronic facsimile bids will be sealed and treated as sealed bids. Neither the District nor its agents will assume liability for the inability of the bidder to reach the above-named fax number prior to the time of sale specified above. Time of receipt shall be the time recorder by the facsimile receiver.

DATE, MATURITIES AND REDEMPTION

The Bonds are dated October 1, 2020, as the date of original issuance and are in denominations of $5,000 and integral multiples thereof, of a single maturity. Principal is payable on August 1 in the following years in the following amounts:

Year Principal Year Principal

2021 $ 40,000 2028 $ 160,000 2022 25,000 2029 160,000 2023 25,000 2030 165,000 2024 150,000 2031 170,000 2025 150,000 2032 170,000 2026 150,000 2033 175,000 2027 155,000

The Bonds maturing on August 1, 2029 and thereafter are subject to optional redemption on August 1, 2028 and any date thereafter at a price of par plus accrued interest to the redemption date.

INTEREST Interest is payable on August 1 and February 1 of each year, commencing February 1, 2021. Interest will be computed on a 360-day year, 30-day month basis, to the owners of record as of the close of business on the fifteenth of the immediately preceding month.

TERM BOND OPTION Bids for the Bonds may contain a maturity schedule providing for any combination of serial bonds and term bonds subject to mandatory redemption, so long as the amount of principal maturing or subject to mandatory redemption in each year conforms to the maturity schedule set forth above. Payments coming due on a non-business day will be paid on the next business day.

BOOK-ENTRY-ONLY SYSTEM The Bonds will be issued as fully registered Bonds without coupons and, when issued will be registered in the name of Cede & Co., as nominee of the Depository Trust Company, New York, New York ("DTC"). DTC will act as securities depository of the Bonds. Individual purchases will be made in book-entry form only, in the principal amount of $5,000 and integral multiples thereof. Purchasers will not receive Bonds representing their interest in the Bonds purchased. Principal and interest will be paid to DTC, which will in turn remit such principal and interest to its participants, for subsequent disbursement to the beneficial owner of the Bonds.

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CUSIP NUMBERS The District will assume no obligation for the assignment of CUSIP numbers to the Bonds or for the correctness of any such numbers printed thereon, but the District will permit such printing to be done at the expense of the purchaser, if the purchaser waives any extension of the time of the delivery of the Bonds caused thereby.

TYPE OF PROPOSAL AND AWARD Bids for not less than $1,678,050 (99.0%) plus accrued interest from the dated date of the Bonds to the date of delivery must be received prior to the time specified above. Each bid must specify the interest rates on the Bonds in multiples of 1/100 or 1/8 of 1%, one rate per maturity. Bids will be compared on the basis of true interest cost (“TIC”). The bid which results in the lowest true interest cost will be deemed the most favorable. The true interest cost is computed as the discount rate which, when used with semiannual compounding to determine the present worth of the principal and interest payments as of the date of the Bonds, produces an amount equal to the purchase price. In the event two or more bids provide the lowest true interest cost, the District shall determine which bid shall be accepted, and such determination shall be final. Upon award of the Bonds, the successful bidder will advise the District of the initial reoffering price to the public of the Bonds. Simultaneously with or before delivery of the Bonds, the successful bidder shall furnish to the District a certificate in form and substance acceptable to bond counsel (a) confirming the initial reoffering prices, (b) certifying that a bona fide initial reoffering of the Bonds has been made to the public (excluding bond houses, brokers, and other intermediaries), and (c) stating the price at which a substantial portion of the Bonds were sold to the public (excluding bond houses, brokers and other intermediaries). The District reserves the right to reject any and all bids, to waive any informality in any bid and to adjourn the sale.

BOND INSURANCE AT THE PURCHASER’S OPTION

If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment thereof at the option of the bidder, the purchase of any such insurance policy or the issuance of any such commitment shall be at the sole option and expense of the purchaser of the Bonds. Any increase cots of issuance of the Bonds resulting from such purchase of insurance shall be paid by the purchaser, except that, if the District has requested and received a rating on the uninsured Bonds from a rating agency, the District will pay that rating fee. Any other rating agency fees shall be the responsibility of the purchaser. Failure of the municipal bond insurer to issue the policy after the Bonds have been awarded to the purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on the Bonds.

GOOD FAITH DEPOSIT A Good Faith Deposit (“Deposit”) in the form of a certified or cashier’s check payable to the District or a wire transfer immediately following the award of the Bonds in the amount of $17,000 is required. The Deposit should be received or wire-transferred not later than 3:30 P.M. Central Time on the next business day following the award. If such Deposit is not received by that time, the District may rescind its award to the winning bidder and award the sale of the Bonds to the next best bidder.

DELIVERY The Bonds will be delivered without cost to the Purchaser at a location mutually agreed upon by the Purchaser and the District. Delivery will be subject to the approving legal opinion of Arntson Stewart Wegner PC, Fargo, North Dakota, Bond Counsel, and customary closing certificates, including a certificate that the Official Statement did not at the date of delivery of the Bonds contain any untrue statement of a material fact or fail to state a material fact necessary in order to make the statements contained therein not misleading, a certificate as to absence of material litigation, and an arbitrage certificate. Bonds will be delivered against payment in immediately available funds at the District's designated depository on the date of delivery. Delivery is expected to occur on or about October 1, 2020.

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LEGAL OPINION An opinion as to the validity of the Bonds will be furnished by Arntson Stewart Wegner PC, Fargo, North Dakota, Bond Counsel. The legal opinion, in substantially the form included as Appendix B herein, will accompany the Bonds and will state that the Bonds are valid and binding general obligations of the District enforceable in accordance with their terms, except to the extent to which enforceability may be limited by principles of equity and by state or United States laws relating to bankruptcy, reorganization, moratorium or creditors’ rights generally. Bond Counsel has not participated in the preparation of this Official Statement.

OFFICIAL STATEMENTS

The District has prepared an Official Statement dated September 11, 2020, which the District deems to be a preliminary or “near-final” Official Statement as that term is defined in Rule 15c2-12 of the Securities and Exchange Commission (the “Rule”). The Official Statement is available to prospective proposers and to others who request copies from the District or its Municipal Advisor, PFM Financial Advisors, LLC. Not later than seven business days following the award of the Bonds, the District shall provide copies of the Final Official Statement, as that term is used in the Rule, to the successful purchaser of the Bonds. The Final Official Statement will be the Official Statement dated September 23, 2020, which includes the maturity date and amount, interest rate and reoffering yield or price, and any other information required by law. The Purchaser will be supplied with Final Official Statements in a quantity sufficient to meet their request. Up to 25 copies of the Final Official Statement will be furnished without cost. ON BEHALF OF THE RICHLAND PUBLIC SCHOOL DISTRICT NO. 44 /s/ Superintendent Further information may be obtained from: PFM Financial Advisors, LLC 50 South Sixth Street, Suite 2250 Minneapolis, Minnesota 55402 Tel: (612) 338-3535 Fax: (612) 338-7264

OFFICIAL BID FORM

(Electronic and Sealed Bids Accepted)

$1,695,000 Taxable General Obligation School Building Refunding Bonds, Series 2020 Richland Public School District No. 44, North Dakota

Members of the Board Sale Date: September 16, 2020 Richland School District No. 44 FAX: (612) 338-7264 c/o PFM Financial Advisors, LLC

For all or none of the principal amount of $1,695,000(1) Taxable General Obligation School Building Refunding Bonds, Series 2020 (the “Bonds”), dated October 1, 2020, legally issued and as described in the Official Notice of Sale, we will pay the District $___________ (not less than $1,678,050) plus accrued interest on the total principal of $1,695,000 to date of delivery, provided the Bonds bear the following interest rates:

Year Principal Interest Rate Year Principal Interest Rate

2021 $ 40,000 ______% 2028 $ 160,000 ______% 2022 25,000 ______% 2029 160,000 ______% 2023 25,000 ______% 2030 165,000 ______% 2024 150,000 ______% 2031 170,000 ______% 2025 150,000 ______% 2032 170,000 ______% 2026 150,000 ______% 2033 175,000 ______% 2027 155,000 ______%

The Bonds mature on August 1 in each of the years as indicated above and interest is payable semiannually on August 1 and February 1 of each year, commencing February 1, 2021. We hereby designate that the following bonds be aggregated into term bonds maturing on August 1 of the following years and in the following amounts (leave blank if no term bonds are specified):

Years Aggregated Maturity Year Amount _________ through _________ _____________ _____________ _________ through _________ _____________ _____________ _________ through _________ _____________ _____________

In making this offer, we accept the terms and conditions as defined in the Official Notice of Sale published in the Official Statement dated September 11, 2020, and certify that we are an Underwriter and have an established industry reputation for underwriting new issuances of municipal bonds. Our good faith deposit of $17,000 will be filed according to the terms outlined in the Official Notice of Sale. All blank spaces of this offer are intentional and are not to be construed as an omission.

NOT PART OF THIS BID:

Explanatory Note: According to our computation, this bid involves the following: $_________________________________ True Interest Cost __________________________________% True Interest Rate (TIC)

Respectfully submitted, ____________________________________ Account Manager By_________________________________ (A list of the firms associated with us in this bid is on the reverse side of this proposal.)

* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * The foregoing offer is hereby accepted by and on behalf of Richland School District No. 44, North Dakota, this 16th day of September, 2020. ________________________________________ __________________________________________ Board President Superintendent

dickinson public school district, north dakota...2020/09/11 · bids received until: 11:00 a.m....

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